EXHIBIT 10(A)(7)
SECOND SUPPLEMENTAL AMENDED AND RESTATED
STOCK PLEDGE AND SECURITY AGREEMENT
THIS SECOND SUPPLEMENTAL AMENDED AND RESTATED STOCK PLEDGE AND SECURITY
AGREEMENT (this "Agreement"), dated as of March 18, 1999, made by SCI HOLDINGS,
INC., a Delaware corporation and INTERAGENCY, INC., a Delaware corporation
(together, the "Pledgor"), each a wholly owned subsidiary of SCI SYSTEMS, INC.,
a Delaware corporation ("Borrower"), to CITIBANK, N.A. (the "Pledgee"), acting
in its capacity as agent for the Pledgee, ABN AMRO Bank N.V. ("ABN AMRO") and
Bank of America Illinois (collectively, the "Co-Agents") and the banks and other
lending institutions (the "Banks") which are signatories to the Amended and
Restated Credit Agreement dated as of August 3, 1995, among Borrower, the
Pledgee, the Co-Agents and the Banks, and acting as Agent for any assignees
which become Banks as provided in such Amended and Restated Credit Agreement.
WITNESSETH:
WHEREAS, pursuant to the Amended and Restated Credit Agreement described
above (as the same may be amended, restated, supplemented or otherwise modified
from time to time, the "Credit Agreement"; the terms defined in the Credit
Agreement and not otherwise defined herein are used herein with the same
meaning), the Pledgee, the Co-Agents and the Banks have committed to loan
certain amounts to, and ABN AMRO, in its capacity as Co-Agent (acting for the
Banks) has amended the Letter of Credit for the benefit of, the Borrower; and
WHEREAS, pursuant to the Credit Agreement, the Pledgor entered into a
certain amended and restated stock pledge and security agreement dated as of
August 3, 1995 (the "1995 Pledge Agreement") and a first supplemental amended
and restated stock pledge and security agreement dated as of March __, 1998 (the
"First Supplemental Pledge Agreement"); and
WHEREAS, it is a condition precedent to the Banks' obligations continue to
make Loans to Borrower under the Credit Agreement that the Pledgor execute and
deliver to the Pledgee this Agreement (which shall supplement the 1995 Pledge
Agreement executed by Pledgor at the initial closing of the Credit Agreement and
also supplement the First Supplemental Pledge Agreement);
WHEREAS, the Pledgor desires to execute this Agreement to satisfy the
condition described in the preceding paragraph;
NOW, THEREFORE, in consideration of the benefits accruing to the Pledgor,
the receipt and sufficiency of which are hereby acknowledged, and in order to
induce the Pledgee, the Co-Agents and the Banks to continue to make Loans to
Borrower under the Credit Agreement the Pledgor hereby makes the following
representations and warranties to the Pledgee and hereby covenants and agrees
with the Pledgee as follows:
0.XXXXXXXX FOR OBLIGATIONS ETC. This Agreement is for
the benefit of the Pledgee to secure the prompt payment in full when due,
whether at stated maturity, by acceleration or otherwise, of (i) the Loans, the
Notes, the Pledgor's reimbursement obligations in respect of the Letter of
Credit and all other Obligations (whether for principal, interest, fees,
expenses or otherwise), (ii) all obligations of the Pledgor now or hereafter
existing under the Credit Agreement or under this Agreement (whether for
principal, interest, fees, expenses or otherwise) or under any Interest Rate
Contracts, and (iii) all costs and expenses incurred by the Pledgee or any Bank
in connection with the exercise of its rights and remedies hereunder (including
reasonable attorneys' fees) (all such obligations collectively being the
"Secured Obligations").
2.PLEDGED STOCK. As used herein, the term
"Pledged Stock" shall mean the number of issued and outstanding shares or
other interests specified on Annex A attached hereto which Pledgor owns of each
class of capital stock of or other interests in the corporations or other
entities identified on Annex A attached hereto (collectively, the
"Subsidiaries"). The Pledgor represents and warrants that on the date hereof (a)
the Pledged Stock consists of the number of shares of the stock or other
interests of the Subsidiaries as described in Annex A attached hereto; (b) the
Pledgor is the holder of record and sole beneficial owner of such Pledged Stock;
and (c) the Pledged Stock constitutes the percentage of the issued and
outstanding stock or other interests of the Subsidiaries indicated on Annex A.
3.PLEDGE OF SECURITIES, ETC.
3.A.Pledge. To secure the Secured Obligations and for the purposes set forth in
Section 1, the Pledgor hereby pledges to the Pledgee (for and on behalf of the
Pledgee, the Co-Agents and the Banks), and grants a security interest in, the
Pledged Stock, together with (i) the certificates representing such Pledged
Stock accompanied by stock powers duly executed in blank by the Pledgor, and
(ii) subject to the rights of the Pledgor set forth in Section 6, all dividends
(whether in cash, stock, warrants, options, or other securities), cash,
instruments or other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any and all of the
Pledged Stock; and hereby assigns, transfers, hypothecates and sets over to the
Pledgee all of the Pledgor's right, title and interest in and to the Pledged
Securities (and in and to the certificates or instruments evidencing the items
described in clauses (i) and (ii) above) to be held by the Pledgee, upon the
terms and conditions set forth in this Agreement. Subject to the terms of the
Intercreditor Agreement, the Pledgor agrees to deliver to the Pledgee all
certificates and instruments evidencing the items described in clause (ii) above
promptly upon the Pledgor's receipt thereof. 3.B.Definition of Pledged
Securities and Collateral. The Pledged Stock and all items described in clause
(ii) of Section 3.1 are hereinafter called the "Pledged Securities," and the
Pledged Securities, together with all other securities and moneys received and
at the time held by the Pledgee hereunder and any proceeds of any of the
foregoing, are hereinafter called the "Collateral."
4.APPOINTMENT OF SUB-AGENTS; ENDORSEMENTS, ETC.
The Pledgee shall have the right to appoint one or more agents for the purpose
of retaining physical possession of the Collateral, which may be held (if
applicable and in the discretion of the Pledgee) in the name of the Pledgor,
endorsed or assigned in blank or in favor of the Pledgee or any nominee or
nominees of the Pledgee or an agent appointed by the Pledgee.
0.XXXXXX, ETC. Unless and until an Event of Default
(such term to mean an Event of Default as defined herein) shall have
occurred and be continuing, the Pledgor shall be entitled to vote any and all
Pledged Stock and to give consents, waivers or ratifications in respect thereof;
provided that no vote shall be cast or any consent, waiver or ratification given
or any action taken which would violate or be inconsistent with any of the terms
of this Agreement, the Credit Documents, or any instrument or agreement relating
to the Obligations; provided, further, that the Pledgor shall give the Pledgee
at least five (5) Business Days, written notice of the manner in which it
intends to exercise, or the reasons for refraining from exercising, any such
right if the exercise or non-exercise of such right potentially may violate or
be inconsistent with the aforementioned agreements. All such rights of the
Pledgor to vote and to give consents, waivers and ratifications shall cease in
case an Event of Default shall occur and be continuing, and Section 7 hereof
shall become applicable.
6.DIVIDENDS AND OTHER DISTRIBUTIONS. A. Unless an
Event of Default shall have occurred and be continuing, all cash dividends
payable in respect of the Pledged Securities shall be paid to the Pledgor, but
only to the extent (if any) permitted by the Credit Agreement. The Pledgee shall
also be entitled to receive directly, and to retain as part of the Collateral:
1.all other or additional stock or securities paid or distributed by way
of dividend in respect of the Pledged Securities;
2.all other or additional stock or other securities paid or distributed
in respect of the Pledged Securities by way
of stock-split, spin-off, split-up, reclassification, combination of
shares or similar rearrangement; and
3.all other or additional stock or other securities which may be paid
in respect of the Pledged Securities by
reason of any consolidation, merger, exchange of stock,
conveyance of assets, liquidation or similar corporate reorganization.
Additional Shares. The Pledgor agrees and covenants
that it will cause the Subsidiaries not to issue any stock or other securities
in addition to or in substitution for the Pledged Securities except stock or
other securities which are either (i) issued to the Pledgor and pledged to the
Pledgee pursuant to this Agreement, to the extent necessary to keep 66% of the
issued and outstanding Pledged Stock pledged to the Pledgee hereunder and
delivered to the Pledgee within two (2) business days from the date of issuance
or (ii) issued in a manner otherwise acceptable to the Required Banks.
0.XXXXXX OF DEFAULT.
7.A.Definition of Events of Default. Any of the following specified events shall
constitute an Event of Default under this Agreement:
4.the existence or occurrence
of any Event of Default as provided under the terms of the Credit
Agreement;
5.any representation, warranty or statement made or deemed to be made
by the Pledgor or any of its officers
under or in connection with this Agreement shall have been incorrect
in any material respect when made or deemed to be made;
6.the Pledgor shall fail to
observe or perform any covenant or agreement set forth in Section 6
(including Section 6.1), Section 15 or Section 17; or
7.the Pledgor shall fail to
observe or perform any covenant or agreement set forth in this
Agreement, other than those referred to in paragraph(c) above, and such
failure remains unremedied until the first to occur of the date
forty-five (45) days after an Executive Officer first obtains
knowledge thereof or the date thirty (30) days after written
notice thereof shall have been given to the Pledgor by any Bank.
7.B.Remedies. In case an Event of Default shall have occurred and be continuing,
and subject to Section 7.3 hereof, the Pledgee shall be entitled to exercise all
of the rights, powers and remedies (whether vested in it by this Agreement, any
other Credit Document or by law and including, without limitation, all rights
and remedies of a secured party of a debtor in default under the Uniform
Commercial Code (the "Code") in effect in the State of New York at that time)
for the protection and enforcement of its rights in respect of the Collateral,
and the Pledgee shall be entitled (subject to the rights of any holders of first
priority pledges and security interests on any portions of the Collateral as
permitted by the terms of this Agreement), without limitation, to exercise any
or all of the following rights, which the Pledgor hereby agrees to be
commercially reasonable: (a)to receive all amounts payable to the Pledgor in
respect of the Collateral otherwise payable under Section 6 and to enforce the
payment of the Pledged Securities and to exercise all of the rights, powers, and
remedies of the Pledgor thereunder; (b)to transfer all or any part of the
Collateral into the Pledgee's name or the name of its nominee or nominees; (c)to
vote all or any part of the Collateral (whether or not transferred into the name
of the Pledgee) and give all consents, waivers and ratifications in respect of
the Collateral and otherwise act with respect thereto as though it were the
outright owner thereof; (d)at any time or from time to time to sell, assign and
deliver, or grant options to purchase, all or any part of the Collateral in one
or more parcels, or any interest therein, at any public or private sale at any
exchange, broker's board or at any of the Pledgee's offices or elsewhere,
without demand of performance, advertisement or notice of intention to sell or
of the time or place of sale or adjournment thereof or to redeem or otherwise
(all of which are hereby expressly and irrevocably waived by the Pledgor), for
cash, on credit or for other property, for immediate or future delivery without
any assumption of credit risk, and for such price or prices and on such terms as
the Pledgee in its sole discretion may determine. The Pledgor agrees that to the
extent that notice of sale shall be required by law that at least 10 days'
written notice to the Pledgor of the time and place of any public sale or the
time after which any private sale is to be made shall constitute reasonable
notification. The Pledgee shall not be obligated to make any sale of
Collateral regardless of notice of sale having been given. The Pledgee may
adjourn any public or private sale from time to time by announcement at the time
and place fixed therefor, and any such sale may, without further notice, be made
at the time and place to which it was so adjourned. The Pledgor hereby waives
and releases to the fullest extent permitted by law any right or equity of
redemption with respect to the Collateral, whether before or after sale
hereunder, and all rights, if any, of marshaling the Collateral and any other
security for the Obligations or otherwise. At any such sale, unless prohibited
by applicable law, the Pledgee may bid for and purchase all or any part of the
Collateral so sold free from any such right or equity of redemption. The Pledgee
shall not be liable for failure to collect or realize upon any or all of the
Collateral or for any delay in so doing nor shall it be under any obligation to
take any action whatsoever with regard thereto; (e)to settle, adjust, compromise
and arrange all accounts, controversies, questions, claims and demands
whatsoever in relation to all or any part of the Collateral; (f)to execute all
contracts, agreements, documents and instruments to bring, defend and abandon
all such actions, suits and
proceedings, and to take all other actions, in relation to all or any part of
the Collateral as the Pledgee in its sole discretion may determine; (g)to
appoint managers, agents and officers for any of the purposes mentioned in the
foregoing provisions of this Section 7 and to dismiss the same, all as the
Pledgee in its sole discretion may determine; and (h)generally, to take all such
other action as the Pledgee may determine as incidental or conducive to any of
the matters or powers mentioned in the foregoing provisions of this Section 7
and which the Pledgee may or can do lawfully and to use the name of the Pledgor
for the purposes aforesaid and in any proceedings arising therefrom.
7.C.Decisions Relating to Exercise of Remedies. Notwithstanding anything in this
Agreement to the contrary, as provided in the Credit Agreement, the Pledgee
shall exercise, or shall refrain from exercising, any remedy provided for in
Section 7.2 in accordance with the terms of Section 11.01 of the Credit
Agreement. Neither the Co-Agents nor any Bank may exercise any remedies provided
for herein.
1.REMEDIES, ETC., CUMULATIVE. Each right, power and
remedy of the Pledgee provided for in this Agreement or any other Credit
Document or now or hereafter existing at law or in equity or by statute shall be
cumulative and concurrent and shall be in addition to every other such right,
power or remedy. The exercise or beginning of the exercise by the Pledgee of any
one or more of the rights, powers or remedies provided for in this Agreement or
any other Credit Document or now or hereafter existing at law or in equity or by
statute or otherwise shall not preclude the simultaneous or later exercise by
the Pledgee of all such other rights, powers or remedies, and no failure or
delay on the part of the Pledgee to exercise any such right, power or remedy
shall operate as a waiver thereof. Any Event of Default, or any event which with
the passing of time or the giving of notice might become an Event of Default,
may be waived by written consent of the Required Banks but any such waiver shall
apply only to the specific occasion which is the subject of such waiver and
shall not apply to the occurrence of the same or any similar event on any future
occasion.
2.APPLICATION OF PROCEEDS.All moneys collected by the
Pledgee upon any sale or other disposition of the Collateral, together with all
other moneys received by the Pledgee hereunder, shall be applied as follows
(subject to the terms and conditions of the Intercreditor Agreement and the
rights of any holders of any first priority pledges and security interests on
any portions of the Collateral as permitted by the terms of this Agreement):
First, to the payment of the reasonable costs and expenses of such sale,
collection or other realization, including, without limitation, reasonable
attorneys' fees and all other
expenses, liabilities and advances made or incurred by the Pledgee in connection
therewith; Second, to the payment of the Secured Obligations then due so that
each Bank shall receive under this Clause Second payment of an amount equal to
the product of (1) the total amount available for payment under this Clause
Second and (ii) a fraction, the numerator of which is the total amount of
Secured Obligations then due to such Bank and the denominator of which is the
total amount of all Secured Obligations then outstanding; and Third, after
payment in full of all Secured Obligations then due, to the Pledgor, or its
successors or assigns, or to whomsoever may be lawfully entitled to receive the
same or as a court of competent jurisdiction may direct any surplus then
remaining from such proceeds.
3.PURCHASERS OF COLLATERAL. Upon any sale of any of
the Collateral hereunder (whether by virtue of the power of sale herein granted
pursuant to judicial process or otherwise), the receipt of the Pledgee or the
officer making the sale shall be a sufficient discharge to the purchaser or
purchasers of the Collateral so sold, and such purchaser or purchasers shall not
be obligated to see to the application of any part of the purchase money paid
over to the Pledgee or such officer or be answerable in any way for the
misapplication or nonapplication thereof.
4.INDEMNITY; EXPENSES. (a) The Pledgor shall pay, and
shall protect, indemnify and save harmless the Pledgee, the Co-Agents and the
Banks and, in their capacity as such, the officers, directors, shareholders,
controlling persons, employees, agents, and servants of the Pledgee, any
Co-Agent or any Bank from and against all liabilities, losses, claim, damages,
penalties, causes of action, suits, costs and expenses (including, without
limitation reasonable attorneys' fees and expenses) or judgments of any nature
arising from (i) the offering and sale of, and payment or non-payment on, the
Commercial Paper Notes or the issuance of the Letter of Credit, (ii) the default
of the Pledgor or any other Credit Party or the Depository in the performance of
its respective agreements, rights or obligations contained in this Agreement,
the Depositary Agreement or any other Credit Document entered into by the
Pledgor or such Credit Party or the Depositary in connection herewith or
therewith, (iii) any actual or proposed use of the proceeds of the Loans or the
Commercial Paper Notes or the Pledgor's or any Credit Party's entering into and
performing any Credit Document or any Commercial Paper Documents, (iv) the
Pledgee's, any Co-Agent's or any Banks' making, holding or administering the
Loans, the Letter of Credit, the Credit Documents or any of the Collateral
pledged in connection with any Credit Document (provided that the right of
payment and indemnification under this clause (iv) shall not apply to any
liabilities, losses, costs and expenses arising out of any successful action by
the Pledgor against the Pledgee, any Co-Agent or any Bank for a breach of its
obligations hereof, but nothing in this proviso shall modify or impair the
Pledgee's, any Co-Agent's or any Bank's rights under Section 11(b) hereof), (v)
allegations of participation or interference by the Pledgee, any Co-Agent or any
Bank in the management, contractual relations or other affairs of the Pledgor
(provided that the right of payment and indemnification under this clause (v)
shall not apply to any liabilities, losses, costs and expenses arising out of
any successful action by the Pledgor against the Pledgee, any Co-Agent or any
Bank for a breach of its obligations
hereof, but nothing in this proviso shall modify or impair the Pledgee's, any
Co-Agent's or any Bank's rights under Section 11(b) hereof), or (vi) allegations
that the Pledgee, any Co-Agent or any Bank has joint liability with Pledgor for
any reason; provided that the Pledgor will not be liable for such liabilities,
losses, claims, damages, penalties, causes of action, suits, costs and expenses
(including, without limitation, attorneys' fees and expenses) or judgments of
any arising from any untrue statement of a material fact in the material
relating to the Pledgee, any Co-Agent or any Bank in any offering circular used
in the sale of the Commercial Paper Notes or omission of a material fact
relating to the Pledgee, any Co-Agent or any Bank required to be stated therein
or necessary in order to make the statements therein relating to the Pledgee,
any Co-Agent or any Bank in the light of the circumstances under which they were
made not misleading if, but only if, such material was specifically approved in
writing by the Pledgee, such Co-Agent or such Bank, as the case may be, prior to
its inclusion in such offering circular; and further provided that the Pledgor
will not be liable for any such liabilities, losses, claims, damages, penalties,
causes or action, suits, costs and expenses or judgments to the extent the same
are the result of or arise out of the gross negligence or willful misconduct of
the Pledgee, any Co-Agent or any Bank or any of the officers, directors,
shareholders, controlling persons, employees, agents and (of any of them) of the
Pledgee, any Co-Agent or any Bank. If any action, suit or proceeding arising
from any of the foregoing is brought against the Pledgee, any Co-Agent or any
Bank or any other person indemnified pursuant to this Section, the Pledgor will,
if requested in writing by the Pledgee, any Co-Agent or any Bank to do so, at
its expense, resist and defend such action, suit or proceeding or cause the same
to be resisted and defended by counsel designated by the Pledgor (which counsel
shall be satisfactory to the Pledgee, the Co-Agent involved and the Bank(s)
involved). Each of the Pledgor's obligations under this Section 11(a) shall
survive the termination of this Agreement.
8.The Pledgor shall pay all reasonable out-of-pocket costs and expenses of
the Pledgee incurred in connection with the administration of, the preservation
of rights under, and enforcement of, and, after an Event of Default, the
renegotiation or restructuring of this Agreement and any amendment, waiver or
consent relating thereto (including, the reasonable fees and disbursements of
counsel for the Pledgee). The Pledgor shall also pay and hold Pledgee harmless
from and against any and all present and future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies which arise from
any payment made hereunder or from the execution, delivery or registration of,
or otherwise with respect to this Agreement and save the Pledgee harmless from
and against any and all liabilities with respect to or resulting from any delay
or omission to pay any such taxes, charges or levies.
1.FURTHER ASSURANCES. The Pledgor agrees that it will
do such acts and things and promptly execute and deliver to the Pledgee such
additional conveyances, assignments, agreements and instruments as the Pledgee
may reasonably require or deem advisable to carry into effect the purposes of
this Agreement or to further assure and confirm unto the Pledgee its rights,
powers and remedies hereunder.
2.THE PLEDGEE AS AGENT.
The Pledgee will hold in accordance with this Agreement and the Credit
Agreement all items of the Collateral at any time received under this Agreement.
It is expressly understood and agreed that the obligations of the Pledgee as
holder of the Collateral and interests therein and with respect to the
disposition thereof, and otherwise under this Agreement, are only those
expressly set forth in this Agreement, the Intercreditor Agreement, and the
Credit Agreement. The Pledgee shall be deemed
to have exercised reasonable care in the custody and preservation of the
Collateral in its possession if the Collateral is accorded treatment
substantially equal to that which the Pledgee accords its own property, it being
understood that the Pledgee shall not have responsibility for (i) ascertaining
or taking action with respect to calls, conversions, exchanges, maturities,
tenders or other matters relative to any Collateral, whether or not the Pledgee
has or is deemed to have knowledge of such matters, or (ii) taking any necessary
steps to preserve rights against any parties with respect to any Collateral.
1.REPRESENTATIONS AND WARRANTIES. The Pledgor
hereby represents and warrants that (i) it is the legal record and beneficial
owner of, and has good and marketable title to, the Pledged Stock described in
Section 2 hereof, subject to no pledge, lien, mortgage, hypothecation, security
interest, charge, option or other encumbrance whatsoever, except Liens and
security interests created by this Agreement or expressly permitted by this
Agreement or the Credit Agreement; (ii) it has full power, authority and legal
right to pledge all the Pledged Stock pursuant to this Agreement; (iii) to the
best of its knowledge, no consent of any other party (including, without
limitation, any stockholder or creditor of the pledgee or any of the
Subsidiaries) and no order, consent, license, permit, approval, validation or
authorization of, exemption by, notice to or registration, recording, filing or
declaration with, any governmental or public body or authority is required to be
obtained by the Pledgor in connection with the execution, delivery or
performance of this Agreement or consummation of the transactions contemplated
hereby, including, without limitation, the exercise by the Pledgee of the voting
or other rights provided for in this Agreement or the remedies in respect of the
Collateral pursuant to this Agreement (except as may be required in connection
with the disposition of the Pledged Securities by laws affecting the offering
and sale of securities generally and except as set forth on Annex B attached
hereto); (iv) all shares of Pledged Stock have been duly and validly issued, are
fully paid and nonassessable; and (v) to the best of its knowledge, except as
set forth on Annex B attached hereto, the pledge and delivery of the Pledged
Securities pursuant to this Agreement creates a valid and perfected first
priority security interest in the Pledged Securities, and the Pledged
Securities, and the proceeds thereof, which security interest is not subject to
any prior Lien or any agreement purporting to grant to any third party a Lien on
the property or assets of the Pledgor which would include the Pledged Securities
(other than the Lien of the Intercreditor Agreement, if any, or any other
intercreditor agreement entered into pursuant to the Credit Agreement and Liens
expressly permitted by the Credit Agreement).
2.COVENANTS OF THE PLEDGOR. The Pledgor covenants
and agrees that (i) the Pledgor will defend the Pledgee's right, title and
security interest in and to the Pledged Securities and the proceeds thereof
against the claims and demands of all Persons whomsoever; (ii) the Pledgor will
have like title to and right to pledge any other property at any time hereafter
pledged to the Pledgee as Collateral hereunder and will likewise defend the
right thereto and security interest therein of the Pledgee; and (iii) the
Pledgor will not, with respect to any Collateral, enter into any shareholder
agreements, voting agreements, voting trusts, trust deeds, irrevocable proxies
or any other similar agreements or instruments.
3.PLEDGOR'S OBLIGATIONS ABSOLUTE, ETC. The
obligations of the Pledgor under this Agreement shall be absolute and
unconditional in accordance with its terms and shall remain in full force and
effect without regard to, and shall not be released, suspended, discharged,
terminated or otherwise affected by, any circumstance or occurrence whatsoever,
including, without limitation: (a) any change in the time, place or manner of
payment of, or in any other term of, all or any of the Secured Obligations, any
waiver, indulgence, renewal, extension, amendment or modification of or
addition, consent or supplement to or deletion from or any other action or
inaction under or in respect of the Credit Agreement, any Note, any other Credit
Document, or any of the other documents, instruments or agreements relating to
the Secured Obligations or any other instrument or agreement referred to therein
or any assignment or transfer of any thereof; (b) any lack of validity or
enforceability of the Credit Agreement, any other Credit Document, or any other
documents, instruments or agreement referred to therein or any assignment or
transfer of any thereof; (c) any furnishing of any additional security to the
Pledgee, or its assignees or any acceptance thereof or any release of any
security by the Pledgee or its assignees; (d) any limitation on any party's
liability or obligations under any such instrument or agreement or any
invalidity or unenforceability, in whole or in part, of any such instrument or
agreement or any term thereof; (e) any bankruptcy, insolvency, reorganization,
composition, adjustment, dissolution, liquidation or other like proceeding
relating to the Pledgor or any of the Subsidiaries, or any action taken with
respect to this Agreement by any trustee or receiver, or by any court, in any
such proceeding, whether or not the Pledgor shall have notice or knowledge of
any of the foregoing; or (f) any exchange, release or nonperfection of any other
collateral, or any release, amendment or waiver of or consent to departure from
any guaranty or security, for all or any of the Secured Obligations.
4.REGISTRATION, ETC.
If an Event of Default shall have occurred and be continuing and the
Pledgor shall have received from the Pledgee a written request or requests that
the Pledgor cause any registration, qualification or compliance under any
Federal or state securities law or laws to be effected with respect to all or
any part of the Pledged Securities, the Pledgor as soon as practicable and at
its own expense will use its best efforts to cause such registration to be
effected (and be kept effective) and will use its best efforts to cause such
qualification and compliance to be effected (and be kept effective) as may be so
requested and as would permit or facilitate the sale and distribution of such
Pledged Securities, including, without limitation, registration under the
Securities Act of 1933 as then in effect (or any similar statute then in
effect), appropriate qualifications under applicable blue sky or other state
securities laws and appropriate compliance with any other government
requirements, and reasonably do or cause to be done all such other acts and
things as may be necessary to permit the sale of the Pledged Securities to be
made in compliance with Federal and applicable State securities laws; provided,
that the Pledgee shall furnish to the Pledgor such information regarding the
Pledgee as the Pledgor may reasonably request in writing and as shall be
required in connection with any such registration, qualification or compliance.
The Pledgor will cause the Pledgee to be kept reasonably advised in writing as
to the progress of each such registration, qualification or compliance and as to
the completion thereof, will furnish to the Pledgee such number of prospectuses,
offering circulars or other documents incident thereto as the Pledgee from time
to time may reasonably request, and will indemnify the Pledgee and all others
participating in the distribution of such Pledged Securities against all claims,
losses, damages and liabilities caused by any untrue statement (or alleged
untrue statement) of a material fact contained therein (or in any related
registration statement, notification or the like) or by any omission (or alleged
omission) to state therein (or in any related transaction statement,
notification or the like) a material fact required to be stated therein or
necessary to make the statements not misleading in light of the circumstances
under which they were made, except insofar as the same may have been caused by
an untrue statement or omission based upon information furnished in writing to
the Pledgor by the Pledgee, or such others participating in the distribution of
such Pledged Securities, expressly for use therein.
If at any time when the Pledgee shall determine to exercise its right to
sell all or any part of the Pledged Securities pursuant to Section 7, such
Pledged Securities or the part thereof to be sold shall not, for any reason
whatsoever, be effectively registered under the Securities Act of 1933, as then
in effect, the Pledgee may sell such Pledged Securities or part thereof by
private sale in such manner and under such circumstances as necessary or
advisable in order that such sale may legally be effected without such
registration. Without limiting the generality of the foregoing, in any such
event the Pledgee, in its sole discretion (i) may proceed to make such private
sale notwithstanding that a registration statement for the purpose of
registering such Pledged Securities or part thereof shall have been filed under
such Securities Act, (ii) may approach and negotiate with a single possible
purchaser to effect such sale, and (iii) may restrict such sale to a purchaser
or purchasers who will represent and agree that such purchaser is purchasing for
its own account, for investment, and not with a view to the distribution or sale
of such Pledged Securities or part thereof. In the event of any such sale, the
Pledgee shall incur no responsibility or liability for selling all or any part
of the Pledged Securities at a price which the Pledgee, in its sole discretion,
may in good xxxxx xxxx reasonable under the circumstances, notwithstanding the
possibility that a substantially higher price might be realized if the sale were
deferred until after registration as aforesaid.
1.NOTICES, ETC. All notices and other communications
shall be given in the manner specified in Section 15.02 of the Credit Agreement
in the case of the Pledgee, and in the case of the Pledgor, at the address
specified in this Agreement.
2.POWER OF ATTORNEY. The Pledgor hereby absolutely
and irrevocably constitutes and appoints the Pledgee the Pledgor's true and
lawful agent and attorney-in-fact, effective upon the occurrence of an Event of
Default, with full power of substitution, in the name of the Pledgor: (a) to
execute and do all such assurances, acts and things which the Pledgor ought to
do but has failed to do under the covenants and provisions contained in this
Agreement; (b) to take any and all such action as the Pledgee may, in its sole
discretion, determine as necessary or advisable for the purpose of maintaining,
preserving or protecting the security constituted by this Agreement or any of
the rights, remedies, powers or privileges of the Pledgee under this Agreement;
and (c) generally, in the name of the Pledgor exercise all or any of the powers,
authorities, and discretions conferred on or reserved to the Pledgee by or
pursuant to this Agreement, and (without prejudice to the generality of any of
the foregoing) to seal and deliver or otherwise perfect any instrument or
document of conveyance, agreement, or act as the Pledgee may deem proper in or
for the purpose of exercising any of such powers, authorities or discretions.
The Pledgor hereby ratifies and confirms, and hereby agrees to ratify and
confirm, whatever lawful acts the Pledgee shall do or purport to do in the
exercise of the power of attorney granted to the Pledgee pursuant to this
Section 19, which power of attorney, being given for security, is irrevocable.
3.TERMINATION, RELEASE. After full indefeasible
payment and performance of all of the Secured Obligations other than
Secured Obligations which by their terms survive the repayment of the Loans and
irrevocable termination of the Total Commitments, this Agreement shall
terminate, and the Pledgee, at the request and expense of the Pledgor, will
execute and deliver to the Pledgor a proper instrument or instruments
acknowledging the satisfaction and termination of this Agreement, and will duly
assign, transfer and deliver to the Pledgor (without recourse and without any
representation or warranty) such of the Collateral as may be in the possession
of the Pledgee and as has not theretofore been sold or otherwise applied or
released pursuant to this Agreement, together with any moneys at the time held
by the Pledgee hereunder.
4.MISCELLANEOUS.
21.A.Independent Obligations. The Pledgor agrees with the Pledgee that each of
the obligations and liabilities of the Pledgor to the Pledgee under this
Agreement may be enforced against the Pledgor without the necessity of joining
the Borrower, any of the Subsidiaries, any other holders of pledges of or
security interests in any of the Collateral, or any other Person as a party.
21.B.Reaffirmation. The Pledgor hereby acknowledges agrees that each of the 1995
Pledge Agreement and the First Supplemental Pledge Agreement is in full force
and effect as of the date hereof and has not been rescinded, terminated or
revoked by the Pledgor prior to the date hereof, and each of the 1995 Pledge
Agreement and the First Supplemental Pledge Agreement shall remain in full force
and effect after giving effect to this Agreement. 21.C. Successors and Assigns.
This Agreement shall create a continuing security interest in the Collateral and
shall be binding upon the successors and assigns of the Pledgor and shall inure
to the benefit of and be enforceable by the Pledgee, and its successors and
permitted assigns. 21.D.Amendments, Etc. This Agreement may be amended or waived
only with the written consent of the Required Banks and, with respect to any
amendment, the Pledgor. 21.E.Other Definitions. Unless otherwise defined herein
or in the Credit Agreement, terms defined in Article 9 of the Code in the State
of New York are used herein as therein defined. 21.F.Headings; Entire Agreement.
The headings in this Agreement are for purposes of reference only and shall not
limit or define the meaning hereof. This Agreement, together with all
instruments, certificates and documents executed or delivered by the parties in
connection herewith or with reference hereto, embodies the entire understanding
and agreement between the parties hereto with respect to the Collateral and
supersedes all prior agreements, understandings and inducements, whether
expressed or implied, or oral or written. 21.G.Counterparts. This Agreement may
be executed in any number of counterparts, each of which shall be an original,
but all of which shall constitute one instrument. 21.H.Severable Provisions. In
the event that any provision of this Agreement shall prove to be invalid or
unenforceable, such provision shall be deemed to be severable from the other
provisions of this Agreement which shall remain binding on all parties hereto.
5.GOVERNING LAW. This Agreement and the rights and
obligations of the parties hereunder shall be construed in accordance with and
be governed by the law of the State of New York (without giving effect to the
conflict of law principles thereof).
6.JURISDICTION; WAIVER OF JURY TRIAL. PLEDGOR
HEREBY (1) AGREES THAT ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR TO ENFORCE ANY JUDGMENT OBTAINED AGAINST PLEDGOR IN CONNECTION WITH
THIS AGREEMENT BE BROUGHT BY THE PLEDGEE, ANY THE CO-AGENT OR ANY BANK IN ANY
COURT SITTING IN THE STATE OF NEW YORK; (2) IRREVOCABLY SUBMITS TO THE
NONEXCLUSIVE JURISDICTION OF UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK AND OF ANY COURT OF THE STATE OF NEW YORK FOR THE PURPOSES
OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT; (3)
AGREES THAT SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAWS OF THE
STATE OF NEW YORK SHALL APPLY TO THIS ASSIGNMENT AND THE CREDIT DOCUMENTS; AND
(4) IRREVOCABLY WAIVES ANY PRESENT OR FUTURE OBJECTION TO VENUE IN ANY SUCH
COURT, AND ANY PRESENT OR FUTURE CLAIM THAT ANY SUCH COURT IS AN INCONVENIENT
FORUM, IN CONNECTION WITH ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT.
IN WITNESS WHEREOF, the Pledgor and the Pledgee have caused this Agreement to be
executed by their duly elected officers duly authorized as of the date first
above written.
Address for Notices:
SCI HOLDINGS, INC.
INTERAGENCY, INC.
c/o SCI Systems (Alabama), Inc.
0000 X. Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
SCI HOLDINGS, INC., as Pledgor Name:
By:
Name:
Title:
INTERAGENCY, INC., as Pledgor
By:
Name:
Title:
CITIBANK, N.A., as Agent, as Pledgee
By:
Name:
Title:
ANNEX A
SCI HOLDINGS, INC.
Name of Entity
Number of Number of Percentage of Percentage of
Shares or Shares or Shares or Shares or
Percentage of Percentage of Percentage of Percentage of
Partnership Partnership Partnership Partnership
Interest Interest Interest Interest
Owned Pledged Owned Pledged
SCI Systems
Sweden AB 1,000 660 100% 66%
SCI Systems
Finland Oy 100 66 100% 66%
SCI Systems
Spain, S.A. 10,000 6,600 100% 66%
AET Xxxxxxx,
X.X. 10% 6.66% 10% 66%
INTERAGENCY, INC.
Name of Entity
Number of Number of Percentage of Percentage of
Shares or Shares or Shares or Shares or
Percentage of Percentage of Percentage of Percentage of
Partnership Partnership Partnership Partnership
Interest Interest Interest Interest
Owned Pledged Owned Pledged
AET Xxxxxxx
X.X. 10% 6.66% 10% 66%
ANNEX B
EXCEPTIONS TO PLEDGE
[NONE]
SECOND SUPPLEMENTAL AMENDED AND RESTATED
ASSIGNMENT OF INTERCOMPANY LOANS
THIS SECOND SUPPLEMENTAL AMENDED AND RESTATED ASSIGNMENT OF INTERCOMPANY LOANS
(the "Assignment") dated as of March 18, 1999 (the "Effective Date"), between
each of the companies listed on the signature pages hereof (individually, an
"Assignor" and collectively, the "Assignors") and CITIBANK, N.A., as Agent for
and representative of (in such capacity herein called the "Agent") the banks and
other lending institutions which are signatories to the Credit Agreement (as
hereinafter defined) and each assignee of any such bank which may become a Bank
as provided in the Credit Agreement (the "Banks"). The Agent, the Co-Agents and
the Banks are hereinafter collectively called the "Secured Parties".
W I T N E S S E T H:
WHEREAS, SCI Systems, Inc. (the "Company"), the Agent, ABN AMRO Bank N.V. ("ABN
AMRO") and Bank of America Illinois (collectively, the "Co-Agents"), and the
Banks are parties to an Amended and Restated Credit Agreement (as the same may
be amended, restated, supplemented or otherwise modified from time to time, the
"Credit Agreement"; the terms defined in the Credit Agreement and not otherwise
defined herein are used herein with the same meaning), dated as of August 3,
1995, pursuant to which the Banks have committed to loan certain amounts to the
Company and ABN AMRO, in its capacity as a Co-Agent (acting for the Commercial
Paper Banks), has issued an amendment to the Letter of Credit for the benefit of
the Company; WHEREAS, in connection with the Credit Agreement, the Agent, the
Company and certain Subsidiaries of the Company entered into a certain
Assignment of Intercompany Loans dated as of August 3, 1995, as amended by the
First Modification of Amended and Restated Assignment of Intercompany Loans,
dated as of June 28, 1996 (the "1995 Assignment"); WHEREAS, in connection with
the Credit Agreement, the Agent, the Company and certain other Subsidiaries of
the Company entered into a certain First Supplemental Amended and Restated
Assignment of Intercompany Loans dated as of March 31, 1998 (the "First
Supplemental Assignment") WHEREAS, it is a condition precedent to the
obligations of the Banks to continue to make Loans to the Borrower under the
Credit Agreement that the Assignors execute and deliver to the Agent and the
Banks this Agreement (which shall supplement the 1995 Assignment and the First
Supplemental Assignment); WHEREAS, each Assignor desires to execute this
Assignment to satisfy the condition precedent described in the preceding
paragraph;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, each Assignor hereby
makes the following representations and warranties to each Secured Party and
hereby covenants and agrees with each Secured Party as follows: SECTION 1.
Assignment. As collateral (collectively, the "Assigned Collateral") to secure
the Secured Obligations (as defined in Section 2) each Assignor hereby:
7.grants to the Agent for the benefit of each Secured Party a
present and continuing security interest in the Intercompany Loans (other than
Intercompany Loans made by a Foreign Subsidiary to or for the benefit of another
Foreign Subsidiary) and all instruments evidencing any Intercompany Loans (other
than any such instrument issued by a Foreign Subsidiary and payable to the order
of, among others, another Foreign Subsidiary) and all renewals and extensions
thereof, accessions thereto and substitutions therefor, now owned or held or
hereafter owned or held by such Assignor; and
8.grants to the Agent for the benefit of each Secured Party, to
the maximum extent permitted by applicable law, a present and continuing
security interest in all Proceeds of the foregoing. Proceeds shall have the
meaning assigned that term under the Uniform Commercial Code as in effect in the
State of New York or under other relevant law and, in any event, shall include,
but not be limited to, any and all (i) proceeds of any insurance (except
payments made to one not a party to this Assignment), indemnity, warranty or
guaranty payable to the Agent or to such Assignor from time to time with respect
to any of the Assigned Collateral, (ii) instruments representing obligations to
pay amounts in respect of Assigned Collateral and (iii) other amounts from time
to time paid or payable under or in connection with any of the Assigned
Collateral. Security title to the Assigned Collateral shall be held by the Agent
for the benefit of the Secured Parties and their successors and assigns. SECTION
2. Secured Obligations. This Assignment secures, and the Assigned Collateral is
collateral security for, the prompt payment or performance in full when due,
whether at stated maturity, by acceleration or otherwise (including, without
limitation, which, but for the filing of a petition in bankruptcy with respect
to the Company would accrue on such Obligations) of all Obligations (as defined
in the Credit Agreement) whether for principal, premium or interest (including,
without limitation, interest which, but for the filing, of a petition in
bankruptcy with respect to the Company would accrue on such obligations) (all
such obligations being the "Secured Obligations"). SECTION 3. No Release.
Nothing set forth in this Assignment shall relieve any Assignor from the
performance of any term, covenant, condition or agreement on such Assignor's
part to be performed or observed under or in respect of any of the Assigned
Collateral or from any liability to any Person under or in respect of any of the
Assigned Collateral or impose any obligation on the Agent or any Secured Party
to perform or observe any such term, covenant, condition or agreement on any
Assignor's part to be so performed or observed or impose any liability on the
Agent or any Secured Party for any act or omission on the part of any Assignor
relating thereto or for any breach of any representation or warranty on the part
of any Assignor contained in this Agreement, or in respect of the Assigned
Collateral or made in connection herewith or therewith. This paragraph shall
survive the termination of this Assignment and the discharge of any Assignor's
other obligations hereunder and under the Credit Documents. SECTION 4. Delivery
of Assigned Collateral. Immediately upon delivery of any certificates or
instruments (except as provided under the terms of Section 7 hereof)
representing or evidencing the Intercompany Loans and in any event within five
(5) Business Days of any such delivery, such certificates or instruments
executed in favor of any Assignor shall be delivered by such Assignor to and
held by or on behalf of the Agent pursuant hereto and shall be in suitable form
for transfer by delivery, in form and substance satisfactory to the Agent;
provided, however, that no Assignor shall be required to deliver any
certificates or instruments representing or evidencing Intercompany Loans if
such certificate or instrument or Intercompany Loans are excluded from the
Assigned Collateral pursuant to Section 1 hereof. SECTION 5. Representations and
Warranties. Each Assignor represents and warrants as follows: (a)Such Assignor,
at the time of the delivery of any Assigned Collateral pursuant to Section 4 of
this Assignment, will be the legal and beneficial owner of such Assigned
Collateral free and clear of any Lien except for Permitted Encumbrances; (b)Such
Assignor has full corporate power and authority and legal right to pledge the
Assigned Collateral pursuant to this Assignment and make the transfers
contemplated by Section 4 hereof; (c)To the best of its knowledge, no consent of
any other Person (including, without limitation, any stockholder or creditor of
the Assignor) and no consent, authorization, approval, or other action by, and
no notice to or filing with, any governmental authority or other Person is
required either (i) for the transfer by such Assignor of the Assigned Collateral
as contemplated by this Assignment or for the execution, delivery or performance
of this Assignment by such Assignor or (ii) for the exercise by the Agent of the
remedies in respect of the Assigned Collateral pursuant to this Assignment,
except as may be required in connection with such disposition by laws affecting
the offering and sale of instruments generally or except as may be required
under the terms of the Intercreditor Agreement or except as set forth on Annex A
hereto; (d)Except as otherwise permitted by the Credit Agreement and this
Assignment, such Assignor at all times will be the sole beneficial owner of the
Assigned Collateral; and (e)All information set forth herein relating to the
Assigned Collateral is accurate and complete in all material respects as of the
date hereof. SECTION 6. Supplements, Further Assurances. At any time and from
time to time, at the expense of such Assignor, each Assignor shall promptly
execute and deliver all further instruments and documents and take all further
action that may be necessary or that the Agent may reasonably request, in order
to protect any security interest granted or purported to be granted hereby or to
enable the Agent to exercise and enforce its rights and remedies hereunder with
respect to any Assigned Collateral. SECTION 7. Payments on Notes. (a)As long as
no Event of Default shall have occurred and be continuing each Assignor shall be
entitled to receive and retain, and to utilize free and clear of the Lien of
this Assignment, any and all payments of current interest and principal in
respect of such Assignor's respective Assigned Collateral; provided, however,
that any and all payments in the form of securities or notes shall be, and shall
be deemed to be forthwith delivered to the Agent to hold as, Assigned
Collateral and shall, if received by such Assignor, be received in trust for the
benefit of the Agent, be segregated from the other property or funds of such
Assignor, and be forthwith delivered to the Agent as Assigned Collateral in the
same form as so received (with any necessary endorsement). (b)Upon the
occurrence and during the continuance of an Event of Default, all rights of each
Assignor to receive payments of current interest which it would otherwise be
authorized to receive and retain pursuant to Section 7(a) above shall cease and
all rights shall thereupon become vested in the Agent which shall thereupon have
the sole right to receive and hold as Assigned Collateral such payments during
the continuance of such Event of Default. (c)All payments which are received by
any Assignor contrary to the provisions of Section 7(b) above shall be received
in trust for the benefit of the Agent, shall be segregated from other funds of
such Assignor and shall be forthwith paid over to the Agent as Assigned
Collateral in the same form as so received (with any necessary endorsement).
SECTION 8. Covenants. Each Assignor hereby covenants and agrees as follows:
(a)Not to encumber the Assigned Collateral with any kind of Lien, other than
Permitted Encumbrances; (b)Not to sell or otherwise dispose of, or grant any
option or warrant with respect to, any of the Assigned Collateral; (c)To assign
hereunder, in accordance with Sections 1 and 7, any and all additional
instruments, agreements and other documents which are to become part of the
Assigned Collateral; (d)Not to make any Intercompany Loan to SCI Manufacturing
(Malaysia) SDN BHD ("SCI Malaysia") if, after giving effect to such Loan, the
aggregate amount of all Intercompany Loans outstanding to SCI Malaysia at such
time would exceed US $100,000 unless and until the Agent, the Co-Agents and the
Banks have received an opinion of counsel qualified to practice law in Malaysia
in form and substance satisfactory to the Agent and the ABN AMRO, in its
capacity as a Co-Agent; and (e)Not to make any Intercompany Loan to SCI U.K.
Limited, a Guernsey corporation ("SCI U.K.") or Newmoor Industries Limited, a
corporation organized under the laws of England (formerly known as Cambridge
Computer Corporation ("Newmoor") unless and until such Companies shall have
become Credit Parties pursuant to Section 8.17 and Section 9.13 of the Credit
Agreement. SECTION 9. Agent Appointed Attorney-in-Fact. Each Assignor hereby
appoints the Agent as such Assignor's attorney-in-fact, effective upon the
occurrence of an Event of Default, with full authority in the place and stead of
such Assignor and in the name of such Assignor or otherwise, from time to time
in the Agent's discretion to take any action and to execute any instrument which
the Agent may deem necessary or advisable to accomplish the purposes of this
Agreement. SECTION 10. Agent May Perform. If any Assignor fails to perform any
agreement contained herein within thirty (30) days after receipt of a written
request to do so from the Agent, the Agent may itself perform, or cause
performance of, such agreement, and the expenses of the Agent, including the
reasonable fees and expenses of its counsel, incurred in connection therewith
shall be payable by such Assignor under Section 14 hereof.
SECTION 11. Reasonable Care. The Agent shall be deemed to have exercised
reasonable care in the custody and preservation of the Assigned Collateral in
its possession if the Assigned Collateral is accorded treatment substantially
equivalent to that which the Agent, in its individual capacity, accords its own
property consisting of negotiable instruments, it being understood that neither
the Agent nor any other Secured Party shall have responsibility for (i)
ascertaining or taking action with respect to demands, maturities, or other
matters relative to any Assigned Collateral, whether or not the Agent or any
other Secured Party has or is deemed to have knowledge of such matters or (ii)
taking any necessary steps to preserve rights against any Person with respect to
any Assigned Collateral. SECTION 12. Events of Defaults; Remedies Upon Default.
A.Definition of Events of Default. Any of the following specified events shall
constitute an Event of Default under this Assignment: (a)the existence or
occurrence of any Event of Default as provided under the terms of the Credit
Agreement; (b)any representation, warranty or statement made or deemed to be
made by any Assignor or any of their respective officers under or in connection
with this Assignment (other than the representation and warranty in Section 5(e)
of this Assignment) shall have been incorrect in any material respect when made
or deemed to be made; (c)any Assignor shall fail to observe or perform any
covenant or agreement set forth in Section 7(c) and in Section 8; or (d)(i) any
Assignor shall fail to observe or perform any covenant or agreement set forth in
this Assignment, other than in Section 5(e) or those referred to in paragraph
(c) above, and any such failure remains unremedied until the first to occur of
the date forty-five (45) days after an Executive Officer first obtains knowledge
thereof or the date thirty (30) days after written notice thereof shall have
been given to the Assignor by the Agent, or (ii) if the representation and
warranty made by the Assignor in Section 5(c) of this Assignment shall have been
incorrect in any material respect when made or deemed to be made, and continues
to be incorrect in any material respect until the first to occur of the date
forty-five (45) days after an Executive Officer first obtains knowledge thereof
or the date thirty (30) days after written notice thereof shall have been given
to the Assignor by any Bank, the Agent or any Co-Agent. B.Remedies Upon Default.
Subject to Section 12.C, if any Event of Default shall have occurred and be
continuing:
The Agent may from time to time exercise in respect of the Assigned
Collateral in addition to other rights and remedies provided for herein or
otherwise available to it, all the rights and remedies of a secured party of a
debtor in default under the Uniform Commercial Code (the "Code") in effect in
the State of New York at that time, and the Agent may also in its sole
discretion, without notice except as specified below, sell the Assigned
Collateral or any part thereof in one or more parcels at public or private sale,
at any exchange, broker's board or at any of the Agent's offices or elsewhere
for cash, on credit or for future delivery, and at such price or prices and upon
such other terms as the Agent may deem commercially reasonable. The Agent or any
other Secured Party may be the purchaser of any or all of the Assigned
Collateral at any such sale and shall be entitled, for the purpose of bidding
and making settlement or payment of the purchase price for all or any portion of
the Assigned Collateral sold at such sale, to use and apply any of the Secured
Obligations owed to such Person as a credit on account of the purchase price of
any Assigned Collateral payable by such Person at such sale. Each purchaser at
any such sale shall acquire the property sold absolutely free from any claim or
right on the part of any Assignor, and each Assignor hereby waives (to the full
extent permitted by law) all rights of redemption, stay and/or appraisal which
it now has or may at any time in the future have under any rule of law or
statute now existing or hereafter enacted. Each Assignor agrees that, to the
extent notice of sale shall be required by law, at least ten (10) days' written
notice to such Assignor of the time and place of any public sale or the times
after which any private sale is to be made shall constitute reasonable
notification. The Agent shall not be obligated to make any sale of Assigned
Collateral regardless of notice of sale having been given. The Agent may adjourn
any public or private sale from time to time by announcement at the time and
place fixed therefor, and such sale may, be made at the time and place to which
it was so adjourned. Each Assignor hereby waives any claims against the Agent
arising by reason of the fact that the price at which any Assigned Collateral
may have been sold at such a private sale was less than the price which might
have been obtained at a public sale, even if the Agent accepts the first offer
received and does not offer such Assigned Collateral to more than one offeree.
Each Assignor recognizes that, by reason of certain prohibitions contained
in law, rules, regulations or orders of any foreign government, authority or
regulatory body, the Agent may be compelled, with respect to any sale of all or
any part of the Assigned Collateral, to limit purchasers to those who meet the
requirements of such foreign government, authority or regulatory body. Each
Assignor acknowledges that any such sales may be at prices and on terms less
favorable to the Agent than those obtainable through a public sale without such
restrictions, and, notwithstanding such circumstances, agrees that any such
restricted sale shall be deemed to have been made in a commercially reasonable
manner and that the Agent shall have no obligation to engage in public sales.
C.Decisions Relating to Exercise of Remedies. Notwithstanding anything in this
Assignment to the contrary, as provided in the Credit Agreement, the Agent shall
exercise, or shall refrain from exercising, any remedy provided for in Section
12.B. in accordance with the terms of Section 11.01 of the Credit Agreement. No
Secured Party other than the Agent may exercise any remedies provided for
herein. SECTION 13. Application of Proceeds. After and during the continuance of
an Event of Default described in Section 12.A., any cash held by the Agent as
Assigned Collateral and all cash proceeds received by the Agent (all such cash
being "Proceeds") in respect of any sale of, collection from, other realization
upon all or any part of the Assigned Collateral pursuant to the exercise by the
Agent of its remedies as a secured creditor as provided in Section 12 of this
Assignment shall be applied promptly from time to time by the Agent, subject to
Annex B attached hereto and incorporated herein by this reference: First, to the
payment of the Agent's reasonable costs and expenses of such sale, collection or
other realization, including all reasonable expenses, liabilities and advances
made or incurred by the Agent in connection therewith; Second, to the payment of
the Secured
Obligations then due so that each Secured Party shall receive under this
subparagraph payment of an amount equal to the product of (i) the total amount
available for payment under this Clause Second and (ii) a fraction, the
numerator of which is the total amount of Secured Obligations then due to such
Secured Party and the denominator of which is the total amount of all Secured
Obligations then outstanding; and Third, after payment in full of all Secured
Obligations, to each Assignor, or its successors or assigns, or to whomsoever
may be lawfully entitled to receive the same or as a court of competent
jurisdiction may direct, of any surplus then remaining from such Proceeds.
SECTION 14. Expenses. Each Assignor will upon demand pay to the Agent the amount
of any and all reasonable expenses, including the reasonable fees and expenses
of its counsel and of any experts and agents, which the Agent may reasonably
incur in connection with the administration of this Assignment, (ii) the custody
or preservation of, or the sale of, collection from, or other realization upon,
any of the Assigned Collateral, (iii) the exercise or enforcement of any of the
rights of the Agent or any other Secured Party hereunder or (iv) the failure by
such Assignor to perform or observe any of the provisions hereof except where
such expenses result solely from the gross negligence or willful misconduct of
the Agent. Each Assignor shall pay all reasonable out-of-pocket costs and
expenses of the Pledgee in connection with the administration of, the
preservation of rights under, and enforcement of, and, after an Event of
Default, the renegotiation or restructuring of this Agreement and any amendment,
waiver or consent relating thereto (including, without limitation, the
reasonable fees and disbursements of counsel for the Pledgee). Each Assignor
shall also pay and hold Assignee harmless from and against any and all present
and future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies which arise from any payment made hereunder or from
the execution, delivery or otherwise with respect to this Agreement and save the
Assignee harmless from and against any and all liabilities with respect to or
resulting from any delay or omission to pay any such taxes, charges or levies.
SECTION 15. No Waiver. (a) No failure on the part of the Agent to exercise, and
no course of dealing with respect to, and no delay in exercising, any right,
power or remedy hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise by the Agent of any right, power or remedy hereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. The remedies herein provided are to the full extent
permitted by law cumulative and are not exclusive of any remedies provided by
law. Any Event of Default, or any event which with the passing of time or the
giving of notice might become an Event of Default, may be waived by written
consent of the Required Banks, but any such waiver shall apply only to the
specific occasion which is the subject of such waiver and shall not apply to the
occurrence of the same or any similar event on any future occasion. (b)In the
event the Agent shall have instituted any proceeding to enforce any right, power
or remedy under this instrument by foreclosure, sale, entry or otherwise, and
such proceeding shall have been discontinued or abandoned for any reason or
shall have been determined adversely to the Agent, then and in every such case
each Assignor, the Agent and each holder of any of the Obligations, to the
extent permitted by applicable law, shall be restored to their respective former
positions and rights hereunder with respect to the Assigned Collateral, and all
rights, remedies and powers of the Agent and the Secured Parties shall continue
as if no such proceeding had been instituted. SECTION 16. Agent. The Agent has
been appointed as Agent hereunder by the Banks pursuant to the Credit Agreement.
The Agent shall have the right hereunder to make demands, to give notices, to
exercise or refrain from exercising any rights, and to take or refrain from
taking action (including, without limitation, the release or substitution of
Assigned Collateral) in accordance with this Assignment and the Credit
Agreement. The Agent may resign and a successor Agent may be appointed in the
manner provided in the Credit Agreement. Upon the acceptance of any appointment
as an Agent by a successor Agent, that successor Agent shall thereupon succeed
to and become vested with all the rights, powers, privileges and duties of the
retiring Agent under this Assignment, and the retiring Agent shall thereupon be
discharged from its duties and obligations under this Assignment. After any
retiring Agent's resignation, the provisions of this Assignment shall inure to
its benefit as to any actions taken or omitted to be taken by it under this
Assignment while it was Agent. SECTION 17. Indemnification. Each Assignor hereby
agrees jointly and severally that it shall pay, and shall protect, indemnify and
save harmless the Agent, the Co-Agents and the Banks and, in their capacity as
such, the officers, directors, shareholders, controlling persons, employees,
agents, and servants of the Agent, any Co-Agent or any Bank from and against all
liabilities, losses, claims, damages, penalties, causes of action, suits, costs
and expenses (including, without limitation, reasonable attorneys' fees and
expenses) or judgments of any nature arising from (i) the offering and sale of,
and payment or nonpayment on, the Commercial Paper Notes or the issuance of the
Letter of Credit, (ii) the default of any Assignor or any other Credit Party or
the Depository in the performance of its respective agreements, rights or
obligations contained in this Agreement, the Depositary Agreement or any other
Credit Document entered into by any Assignor or such Credit Party or the
Depositary in connection herewith or therewith, (iii) any actual or proposed use
of the proceeds of the Loan or the Commercial Paper Notes or any Assignor's or
any Credit Party's entering into and performing any Credit Document or any
Commercial Paper Documents, (iv) the Agent's, any Co-Agent's or any Bank's
making, holding or administering the Loans, the Letter of Credit, the Credit
Documents or any of the Collateral pledged in connection with any Credit
Document (provided that the right of payment and indemnification under this
clause (iv) shall not apply to any liabilities, losses, costs and expenses
arising out of any successful action by any Assignor against the Agent, any
Co-Agent or any Bank for a breach of its obligations hereof, but nothing in this
provision shall modify or impair the Agent's, any Co-Agent's or any Bank's right
under Section 14 hereof), (v) allegations of participation or interference by
the Agent, any Co-Agent or any Bank in the management, contractual relations or
other affairs of any Assignor (provided that the right of payment and
indemnification under this clause (v) shall not apply to any liabilities,
losses, costs and expenses arising out of any successful action by any Assignor
against the Agent, any Co-Agent or any Bank for a breach of its obligations
hereof, but nothing in this provision shall modify or impair the Agent's, any
Co-Agent's or any Bank's rights under Section 14 hereof), or (vi) allegations
that the Agent, any Co-Agent or any Bank has joint liability with any Assignor
for any reason; provided, that no Assignor will be liable for such liabilities,
losses, claims, damages, penalties, causes of action, suits, costs and expenses
(including, without limitation, attorneys, fees and expenses) or judgments of
any nature arising from any untrue statement of a material fact in the material
relating to the Agent, any Co-Agent or any Bank in any offering circular used in
the sale of the Commercial Paper Notes or omission of a material fact relating
to the Agent, any Co-Agent or any Bank required to be stated therein or
necessary in order to make the statements therein relating to the Agent, any
Co-Agent or any Bank in light of these circumstances under which they were made
not misleading if, but only if, such material was specifically approved in
writing by the Agent, such Co-Agent or such Bank as the case may be, prior to
its inclusion in such offering circular; and further provided that no Assignor
will be liable for any such liabilities, losses, claims, damages, penalties,
causes of action, suits, costs and expenses or judgments to the extent the same
are the result of or arise out of the gross negligence or willfulness conduct of
the Agent, any Co-Agent or any Bank or any of the officers, directors,
shareholders, controlling persons, employees, agents and servants (or any of
them) of the Agent, any Co-Agent or any Bank. If any action, suit or proceeding
arising from any of the foregoing is brought against the Agent, any Co-Agent or
any Bank or any other person indemnified pursuant to this Section, each Assignor
will, if requested in writing by the Agent, any Co-Agent or any Bank to do so,
at its expense, resist in defense such action, suit or proceeding or cause the
same to be resisted and defended by counsel designated by such Assignor (which
counsel shall be satisfactory to the Agent, the Co-Agent involved and the
Bank(s) involved). The obligations of each Assignor under this Section 17 shall
survive the termination of this Agreement. SECTION 18. Amendments, Etc. This
Assignment may not be amended, modified or waived except with the written
consent of each of the Assignors and the Required Banks or except as otherwise
provided in the Credit Agreement. Any amendment, modification or supplement of
or to any provision of this Assignment, any termination or waiver of any
provision of this Agreement and any consent to any departure by any Assignor
from the terms of any provision of this Assignment shall be effective only in
the specific instance and for the specific purpose for which made or given. No
notice to or demand upon the Assignors in any instance hereunder shall entitle
the Assignors to any other or further notice or demand in similar or other
circumstances. SECTION 19. Termination. This Assignment shall terminate upon the
indefeasible payment in full in U.S. Dollars of all Secured Obligations and the
irrevocable termination of the Total Commitments, and then the Agent shall, upon
the request and at the expense of the Assignor, forthwith assign, transfer and
deliver, against receipt and without recourse to the Agent, such of each
Assignor's respective Assigned Collateral as shall not have been sold or
otherwise applied pursuant to the terms hereof to or on the order of such
Assignor. SECTION 20. Notices. All notices, demands, instructions and other
communications required or permitted to be given to or made upon any party
hereto shall be given in the manner provided in Section 15.02 of the Credit
Agreement to the addresses indicated below for the Assignors and the Agent.
SECTION 21. Continuing Security Interest; Transfer of Notes. This Assignment
shall create a continuing security interest in the Assigned Collateral and shall
(i) remain in full force and effect until this
Assignment is otherwise terminated pursuant to Section 19, (ii) be binding
upon the Assignors, their respective successors and assigns, and (iii) inure,
together with the rights and remedies of the Agent hereunder, to the benefit of
each Secured Party and each of their respective successors, transferees and
assigns permitted under the Credit Agreement; no other persons (including
without limitation, any other creditor of any Assignor) shall have any interest
herein or any right or benefit with respect hereto. Without limiting the
generality of the foregoing clause (iii), any Secured Party may assign or
otherwise transfer any indebtedness held by it secured by this Agreement to any
other Person or entity as and to the extent permitted under the Credit
Agreement, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such Secured Party herein or otherwise,
subject however, to the provisions of the Credit Agreement. SECTION 22. Security
Interest Absolute. All rights of the Agent and security interests hereunder and
all obligations of each Assignor hereunder, shall be absolute and unconditional
irrespective of: (a)Any lack of validity or enforceability of the Credit
Agreement, the Notes, any Intercompany Loan, the Guaranty, any other Credit
Document or any other agreement or instrument relating thereto; (b)Any change in
the time, manner or place of payment of, or in any other term of, all or any of
the Secured Obligations, or any other amendment or waiver of or any consent to
any departure from the Credit Agreement, the Notes, any Intercompany Loan, the
Guaranty, any other Credit Document or any other agreement or instrument
relating thereto; or (c)Any exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to any departure
from any other guaranty for all or any of the Secured Obligations. SECTION 23.
Severability of Provisions. Any provision of this Assignment which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction. SECTION 24.
Headings; Entire Agreement. Section headings used in this Assignment are for
convenience of reference only and shall not affect the construction of this
Assignment. This Assignment, together with all instruments, agreements and
certificates executed by the parties in connection herewith or with reference
hereto, embodies the entire understanding and agreement between the parties
hereto with respect to the Assigned Collateral and supersedes all prior
agreements, understandings and inducements, whether express or implied, oral or
written. SECTION 25. Execution in Counterparts. This Assignment may be executed
in any number of counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute one and the same Assignment. SECTION 26.
Release. The Agent may release any or all of the Assigned Collateral at any time
or from time to time in accordance with the provisions of the Credit Agreement.
SECTION 27. Acknowledgments by Obligors. Each Assignor which may from time to
time be obligated to Borrower or any Subsidiary of Borrower for payment of
Intercompany Loans, by signing in the space provided at the end of this
Assignment, acknowledges this Assignment and all of the terms and conditions
contained in this Assignment and agrees to pay the amount which it may at any
time owe such party on any Intercompany Loan directly to Agent immediately upon
receipt of demand for such payment by Agent to the extent that the Agent is
entitled to receive such payment in accordance with the terms of this
Assignment. SECTION 28. Governing Law; Jurisdiction; Waiver of Jury Trial;
Terms. (a)THIS ASSIGNMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF
CONFLICTS OF LAWS THEREOF, EXCEPT AS REQUIRED BY MANDATORY PROVISIONS OF LAW AND
EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE SECURITY INTEREST
HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR ASSIGNED
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK. (b)EACH ASSIGNOR HEREBY (1) AGREES THAT ANY LEGAL ACTION OR PROCEEDING
WITH RESPECT TO THIS ASSIGNMENT OR TO ENFORCE ANY JUDGMENT OBTAINED AGAINST SUCH
ASSIGNOR IN CONNECTION WITH THIS ASSIGNMENT MAY BE BROUGHT BY THE AGENT, ANY
CO-AGENT OR ANY BANK IN ANY COURT SITTING IN THE STATE OF NEW YORK; (2)
IRREVOCABLY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF UNITED STATES DISTRICT
COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND OF ANY COURT OF THE STATE OF NEW
YORK FOR THE PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO
THIS ASSIGNMENT; (3) AGREES THAT SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAWS OF THE STATE OF NEW YORK SHALL APPLY TO THIS ASSIGNMENT AND THE
CREDIT DOCUMENTS; AND (4) IRREVOCABLY WAIVES ANY PRESENT OR FUTURE OBJECTION TO
VENUE IN ANY SUCH COURT, AND ANY PRESENT OR FUTURE CLAIM THAT ANY SUCH COURT IS
AN INCONVENIENT FORUM, IN CONNECTION WITH ANY ACTION OR PROCEEDING RELATING TO
THIS ASSIGNMENT. (c)TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH ASSIGNOR
IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THIS ASSIGNMENT OR ANY OTHER
CREDIT DOCUMENT OR ANY MATTER ARISING IN CONNECTION HEREUNDER OR THEREUNDER.
(d)Unless otherwise defined herein or in the Credit Agreement, terms defined in
Article 8 and 9 of the Code in the State of New York are used herein as therein
defined.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, each Assignor and the Agent have caused this Assignment to
be duly executed and delivered by their respective officer thereunto duly
authorized as of the date first above written.
SCI FOREIGN SALES, INC., a company
organized under the laws of Barbados
By:
Name:
Title:
SCI SYSTEMS SWEDEN AB
By: By:
Name: Xxxxxxx Xxxxxxx Name:
Title: Title:
SCI SYSTEMS FINLAND OY
By:
Name:
Title:
AET XXXXXXX X.X.
By:
Name:
Title:
[Signatures continued on following page]
[Signatures continued from previous page]
SCI NETHERLANDS HOLDINGS B.V.
By:
Name:
Title:
SCI NETHERLANDS B.V.
By:
Name:
Title:
SCI SYSTEMS SPAIN, S.A.
By:
Name:
Title:
AGENT:
CITIBANK, N.A., as Agent
By:
Name:
Title:
ACKNOWLEDGEMENT OF
SECOND SUPPLEMENTAL AMENDED AND RESTATED
ASSIGNMENT OF INTERCOMPANY LOANS
Each of the undersigned acknowledges the foregoing Second Supplemental Amended
and Restated Assignment of Intercompany Loans and agrees to make payments on any
Intercompany Loans (other than Intercompany Loans made by a Foreign Subsidiary
to or for the benefit of another Foreign Subsidiary) directly to Agent upon
receipt of demand for payment from Agent to the extent that the Agent is
entitled to receive such payment in accordance with the terms of such
Assignment.
SCI FOREIGN SALES, INC., a company
organized under the laws of Barbados
By:
Name:
Title:
SCI SYSTEMS SWEDEN AB
By: By:
Name: Xxxxxxx Xxxxxxx Name:
Title: Title:
SCI SYSTEMS FINLAND OY
By:
Name:
Title:
[Signatures continued on following page] [Signatures continued from previous
page]
AET XXXXXXX X.X.
By:
Name:
Title:
SCI NETHERLANDS HOLDINGS B.V.
By:
Name:
Title:
SCI NETHERLANDS B.V.
By:
Name:
Title:
SCI SYSTEMS SPAIN, S.A.
By:
Name:
Title:
ANNEX A
EXCEPTIONS TO CONSENT
The Board of Directors of SCI Systems Sweden AB must expressly authorize the
specific Intercompany Loans to be made by SCI Sweden ("SCI Sweden") to any
Subsidiary from time to time, which authorization shall be made in compliance
with and shall be subject to all applicable laws of Sweden then in effect.
ANNEX A
SCI HOLDINGS, INC.
Name of Entity
Number of Number of Percentage of Percentage of
Shares or Shares or Shares or Shares or
Percentage of Percentage of Percentage of Percentage of
Partnership Partnership Partnership Partnership
Interest Interest Interest Interest
Owned Pledged Owned Pledged
SCI Systems
Sweden AB 1,000 666 100% 66.66%
SCI Systems
Finland Oy 100 66 100% 66%
SCI Systems
Spain, S.A. 10,000 6,600 100% 66%
AET Xxxxxxx,
X.X. 10% 6.66% 10% 66%
INTERAGENCY, INC.
Name of Entity
Number of Number of Percentage of Percentage of
Shares or Shares or Shares or Shares or
Percentage of Percentage of Percentage of Percentage of
Partnership Partnership Partnership Partnership
Interest Interest Interest Interest
Owned Pledged Owned Pledged
AET Xxxxxxx
X.X. 10% 6.66% 10% 66%
SECOND SUPPLEMENTAL AMENDED AND RESTATED
SECURITY AGREEMENT
THIS SECOND SUPPLEMENTAL AMENDED AND RESTATED SECURITY AGREEMENT (this
"Agreement"), dated as of _____________, 1999, made by SCI SYSTEMS, INC., a
Delaware corporation (the "SCI"), to CITIBANK, N.A. ("CITIBANK"), acting in its
capacity as agent for CITIBANK, ABN AMRO Bank N.V. ("ABN AMRO") and Bank of
America Illinois (collectively, the "Co-Agents") and the banks and other lending
institutions (the "Banks") which are signatories to the Amended and Restated
Credit Agreement dated as of August 3, 1995, among SCI Systems, Inc. (the
"Borrower"), CITIBANK, the Co-Agents and the Banks, and acting as Agent for any
assignees which become Banks as provided in such Amended and Restated Credit
Agreement. W I T N E S S E T H: WHEREAS, pursuant to the Amended and Restated
Credit Agreement described above (as the same may be amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement";
the terms defined in the Credit Agreement and not otherwise defined herein are
used herein with the same meaning), CITIBANK, the Co-Agents and the Banks have
committed to loan certain amounts to, and ABN AMRO, in its capacity as Co-Agent
(acting for the Banks) has amended the Letter of Credit for the benefit of, the
Borrower; and WHEREAS, pursuant to the Credit Agreement, SCI entered into a
certain amended and restated stock pledge and security agreement dated as of
August 3, 1995 (the "1995 Pledge Agreement") and a first supplemental
amended and restated stock pledge and security agreement dated as of March __,
1998 (the "First Supplemental Pledge Agreement"); and WHEREAS, it is a condition
precedent to the Banks' obligations to continue to make Loans to the Borrower
under the Credit Agreement that SCI execute and deliver to CITIBANK this
Agreement (which shall supplement the 1995 Pledge Agreement executed by SCI at
the initial closing of the Credit Agreement and also supplement the First
Supplemental Pledge Agreement); WHEREAS, SCI desires to execute this Agreement
to satisfy the condition described in the preceding paragraph; NOW, THEREFORE,
in consideration of the benefits accruing to SCI, the receipt and sufficiency of
which are hereby acknowledged, and in order to induce CITIBANK, the Co-Agents
and the Banks to continue to make Loans to the Borrower under the Credit
Agreement SCI hereby makes the following representations and warranties to
CITIBANK and hereby covenants and agrees with CITIBANK as follows:
0.XXXXXXXX FOR OBLIGATIONS ETC. This Agreement is for the benefit of CITIBANK to
secure the prompt payment in full when due, whether at stated maturity, by
acceleration or otherwise, of (i) the Loans, the Notes, SCI's reimbursement
obligations in respect of the Letter of Credit and all other Obligations
(whether for principal, interest, fees, expenses or otherwise), (ii) all
obligations of SCI now or hereafter existing under the Credit Agreement or under
this Agreement (whether for principal, interest, fees, expenses or otherwise) or
under any Interest Rate Contracts, and (iii) all costs and expenses incurred by
CITIBANK or any Bank in connection with the exercise of its rights and remedies
hereunder (including reasonable attorneys' fees) (all such obligations
collectively being the "Secured Obligations"). 2.CHARGED STOCK. As used herein,
the term "Charged Stock" shall mean the number of issued and outstanding shares
specified on Annex A attached hereto which SCI owns of each class of capital
stock of the corporations identified on Annex A attached hereto (collectively,
the "Subsidiaries"). SCI represents and warrants that on the date hereof (a) the
Charged Stock consists of the number of shares of the stock of the Subsidiaries
as described in Annex A attached hereto; (b) SCI is the holder of record and
sole beneficial owner of such Charged Stock; and (c) the Charged Stock
constitutes the percentage of the issued and outstanding stock of the
Subsidiaries indicated on Annex A. CHARGE OF SECURITIES, ETC. 3.A.Charge. To
secure the Secured Obligations and for the purposes set forth in Section 1, SCI
hereby charges to CITIBANK (for and on behalf of CITIBANK, the Co-Agents and the
Banks), and grants a security interest in, the Charged Stock, together with (i)
the certificates representing such Charged Stock accompanied by stock powers
duly executed in blank by SCI, and (ii) subject to the rights of SCI set forth
in Section 6, all dividends (whether in cash, stock, warrants, options, or other
securities), cash, instruments or other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any and all
of the Charged Stock; and hereby assigns, transfers, hypothecates and sets over
to CITIBANK all of SCI's right, title and interest in and to the Charged
Securities (and in and to the certificates or instruments evidencing the items
described in clauses (i) and (ii) above) to be held by CITIBANK, upon the terms
and conditions set forth in this Agreement. Subject to the terms of the
Intercreditor Agreement, SCI agrees to deliver to CITIBANK all certificates and
instruments evidencing the items described in clause (ii) above promptly upon
SCI's receipt thereof. 3.B.Definition of Charged Securities and Collateral. The
Charged Stock and all items described in clause (ii) of Section 3.1 are
hereinafter called the "Charged Securities," and the Charged Securities,
together with all other securities and moneys received and at the time held by
CITIBANK hereunder and any proceeds of any of the foregoing, are hereinafter
called the "Collateral." 4.APPOINTMENT OF SUB-AGENTS; ENDORSEMENTS, ETC.
CITIBANK shall have the right to appoint one or more agents for the purpose of
retaining physical possession of the Collateral, which may be held (if
applicable and in the discretion of CITIBANK) in the name of SCI, endorsed or
assigned in blank or in favor of CITIBANK or any nominee or nominees of CITIBANK
or an agent appointed by CITIBANK. 0.XXXXXX, ETC. Unless and until an Event of
Default (such term to mean an Event of Default as defined herein) shall have
occurred and be continuing, SCI shall be entitled to vote any and all Charged
Stock and to give consents, waivers or ratifications in respect thereof;
provided that no vote shall be cast or any consent, waiver or ratification given
or any action taken which would violate or be inconsistent with any of the terms
of this Agreement, the Credit Documents, or any instrument or agreement relating
to the Obligations; provided, further, that the SCI shall give CITIBANK at least
five (5) Business Days, written notice of the manner in which it intends to
exercise, or the reasons for refraining from exercising, any such right if the
exercise or non-exercise of such right potentially may violate or be
inconsistent with the aforementioned agreements. All such rights of SCI to vote
and to give consents, waivers and ratifications shall cease in case an Event of
Default shall occur and be continuing, and Section 7 hereof shall become
applicable. 6. ADIVIDENDS AND OTHER DISTRIBUTIONS. Unless an Event of Default
shall have occurred and be continuing, all cash dividends payable in respect of
the Charged Securities shall be paid to SCI, but only to the extent (if any)
permitted by the Credit Agreement. CITIBANK shall also be entitled to receive
directly, and to retain as part of the Collateral:
1.(a)all other or additional stock or securities paid or
distributed by way of dividend in respect of the Charged Securities;
2.(b)all other or additional stock or other
securities paid or distributed in respect of the Charged Securities by way of
stock-split, spin-off, split-up, reclassification, combination of shares or
similar rearrangement; and
3.(c)all other or additional stock or other
securities which may be paid in respect of the Charged Securities by reason of
any consolidation, merger, exchange of stock, conveyance of assets, liquidation
or similar corporate reorganization.
6. B Additional Shares. SCI agrees and covenants that it will cause the
Subsidiaries not to issue any stock or other securities in addition to or in
substitution for the Charged Securities except stock or other securities which
are either (i) issued to SCI and pledged to CITIBANK pursuant to this Agreement,
to the extent necessary to keep 66% of the issued and outstanding Charged Stock
pledged to CITIBANK hereunder and delivered to CITIBANK within two (2)
business days from the date of issuance or (ii) issued in a manner otherwise
acceptable to the Required Banks.
EVENTS OF DEFAULT.
7.A.Definition of Events of Default. Any of the following specified events shall
constitute an Event of Default under this Agreement:
1.(a)the existence or occurrence of any Event of
Default as provided under the terms of the Credit Agreement;
2.(b)any representation, warranty or statement
made or deemed to be made by SCI or any of its officers under or in connection
with this Agreement shall have been incorrect in any material respect when made
or deemed to be made;
3.(c)SCI shall fail to observe or perform any
covenant or agreement set forth in Section 6 (including Section 6.1), Section 15
or Section 17; or
4.(d)SCI shall fail to observe or perform any
covenant or agreement set forth in this Agreement, other than those referred to
in paragraph (c) above, and such failure remains unremedied until the first to
occur of the date forty-five (45) days after an Executive Officer first obtains
knowledge thereof or the date thirty (30) days after written notice thereof
shall have been given to SCI by any Bank.
7.B.Remedies. In case an Event of Default shall have occurred and be
continuing, and subject to Section 7.3 hereof, CITIBANK shall be entitled to
exercise all of the rights, powers and remedies (whether vested in it by this
Agreement, any other Credit Document or by law and including, without
limitation, all rights and remedies of a secured party of a debtor in default
under the Uniform Commercial Code (the "Code") in effect in the State of New
York at that time) for the protection and enforcement of its rights in respect
of the Collateral, and CITIBANK shall be entitled (subject to the rights of any
holders of first priority pledges and security interests on any portions of the
Collateral as permitted by the terms of this Agreement), without limitation, to
exercise any or all of the following rights, which SCI hereby agrees to be
commercially reasonable: (a)to receive all amounts payable to SCI in respect of
the Collateral otherwise payable under Section 6 and to enforce the payment of
the Charged Securities and to exercise all of the rights, powers, and remedies
of SCI thereunder; (b)to transfer all or any part of the Collateral into
CITIBANK's name or the name of its nominee or nominees; (c)to vote all or any
part of the Collateral (whether or not transferred into the name of CITIBANK)
and give all consents, waivers and ratifications in respect of the Collateral
and otherwise act with respect thereto as though it were the outright owner
thereof; (d)at any time or from time to time to sell, assign and deliver, or
grant options to purchase, all or any part of the Collateral in one or more
parcels, or any interest therein, at any public or private sale at any exchange,
broker's board or at any of CITIBANK's offices or elsewhere, without demand of
performance, advertisement or notice of intention to sell or of the time or
place of sale or adjournment thereof or to redeem or otherwise (all of which are
hereby expressly and irrevocably waived by SCI), for cash, on credit or for
other property, for immediate or future delivery without any assumption
of credit risk, and for such price or prices and on such terms as CITIBANK in
its sole discretion may determine. SCI agrees that to the extent that notice of
sale shall be required by law that at least 10 days' written notice to SCI of
the time and place of any public sale or the time after which any private sale
is to be made shall constitute reasonable notification. CITIBANK shall not be
obligated to make any sale of Collateral regardless of notice of sale having
been given. CITIBANK may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and any such sale may,
without further notice, be made at the time and place to which it was so
adjourned. SCI hereby waives and releases to the fullest extent permitted by law
any right or equity of redemption with respect to the Collateral, whether before
or after sale hereunder, and all rights, if any, of marshaling the Collateral
and any other security for the Obligations or otherwise. At any such sale,
unless prohibited by applicable law, CITIBANK may bid for and purchase all or
any part of the Collateral so sold free from any such right or equity of
redemption. CITIBANK shall not be liable for failure to collect or realize upon
any or all of the Collateral or for any delay in so doing nor shall it be under
any obligation to take any action whatsoever with regard thereto; (e)to settle,
adjust, compromise and arrange all accounts, controversies, questions, claims
and demands whatsoever in relation to all or any part of the Collateral; (f)to
execute all contracts, agreements, documents and instruments to bring, defend
and abandon all such actions, suits and proceedings, and to take all other
actions, in relation to all or any part of the Collateral as CITIBANK in its
sole discretion may determine; (g)to appoint managers, agents and officers for
any of the purposes mentioned in the foregoing provisions of this Section 7 and
to dismiss the same, all as CITIBANK in its sole discretion may determine; and
(h)generally, to take all such other action as CITIBANK may determine as
incidental or conducive to any of the matters or powers mentioned in the
foregoing provisions of this Section 7 and which CITIBANK may or can do lawfully
and to use the name of SCI for the purposes aforesaid and in any proceedings
arising therefrom. 7.C. Decisions Relating to Exercise of Remedies.
Notwithstanding anything in this Agreement to the contrary, as provided in the
Credit Agreement, CITIBANK shall exercise, or shall refrain from exercising, any
remedy provided for in Section 7B in accordance with the terms of Section 11.01
of the Credit Agreement. Neither the Co-Agents nor any Bank may exercise any
remedies provided for herein. 22.7.DREMEDIES, ETC., CUMULATIVE. Each right,
power and remedy of CITIBANK provided for in this Agreement or any other Credit
Document or now or hereafter existing at law or in equity or by statute shall be
cumulative and concurrent and shall be in addition to every other such right,
power or remedy. The exercise or beginning of the exercise by CITIBANK of any
one or more of the rights, powers or remedies provided for in this Agreement or
any other Credit
Document or now or hereafter existing at law or in equity or by statute or
otherwise shall not preclude the simultaneous or later exercise by CITIBANK of
all such other rights, powers or remedies, and no failure or delay on the part
of CITIBANK to exercise any such right, power or remedy shall operate as a
waiver thereof. Any Event of Default, or any event which with the passing of
time or the giving of notice might become an Event of Default, may be waived by
written consent of the Required Banks but any such waiver shall apply only to
the specific occasion which is the subject of such waiver and shall not apply to
the occurrence of the same or any similar event on any future occasion.
8.APPLICATION OF PROCEEDS. All moneys collected by CITIBANK upon any sale or
other disposition of the Collateral, together with all other moneys received by
CITIBANK hereunder, shall be applied as follows (subject to the terms and
conditions of the Intercreditor Agreement and the rights of any holders of any
first priority pledges and security interests on any portions of the Collateral
as permitted by the terms of this Agreement): First, to the payment of the
reasonable costs and expenses of such sale, collection or other realization,
including, without limitation, reasonable attorneys' fees and all other
expenses, liabilities and advances made or incurred by CITIBANK in connection
therewith; Second, to the payment of the Secured Obligations then due so that
each Bank shall receive under this Clause Second payment of an amount equal to
the product of (1) the total amount available for payment under this Clause
Second and (ii) a fraction, the numerator of which is the total amount of
Secured Obligations then due to such Bank and the denominator of which is the
total amount of all Secured Obligations then outstanding; and Third, after
payment in full of all Secured Obligations then due, to SCI, or its successors
or assigns, or to whomsoever may be lawfully entitled to receive the same or as
a court of competent jurisdiction may direct any surplus then remaining from
such proceeds. 9.PURCHASERS OF COLLATERAL. Upon any sale of any of the
Collateral hereunder (whether by virtue of the power of sale herein granted
pursuant to judicial process or otherwise), the receipt of CITIBANK or the
officer making the sale shall be a sufficient discharge to the purchaser or
purchasers of the Collateral so sold, and such purchaser or purchasers shall not
be obligated to see to the application of any part of the purchase money paid
over to CITIBANK or such officer or be answerable in any way for the
misapplication or non-application thereof. 10.INDEMNITY; EXPENSES. (a) SCI shall
pay, and shall protect, indemnify and save harmless CITIBANK, the Co-Agents and
the Banks and, in their capacity as such, the officers, directors, shareholders,
controlling persons, employees, agents, and servants of CITIBANK, any Co-Agent
or any Bank from and against all liabilities, losses, claim, damages, penalties,
causes of action, suits, costs and expenses (including, without limitation
reasonable attorneys' fees and expenses) or judgments of any nature arising from
(i) the offering and sale of, and payment or non-payment on, the Commercial
Paper Notes or the issuance of the Letter of Credit, (ii) the default of SCI or
any other Credit Party or the Depository in the performance of its respective
agreements, rights or obligations contained in this Agreement, the Depositary
Agreement or any other Credit Document entered into by SCI or such Credit Party
or the Depositary in connection herewith or therewith, (iii) any actual or
proposed use of the proceeds of the Loans or the Commercial Paper Notes or SCI's
or any Credit Party's entering into and performing any Credit Document or any
Commercial Paper Documents, (iv) CITIBANK's, any Co-Agent's or any Banks'
making, holding or administering the Loans, the Letter of Credit, the Credit
Documents or any of the Collateral pledged in connection with any Credit
Document (provided that the right of
payment and indemnification under this clause (iv) shall not apply to any
liabilities, losses, costs and expenses arising out of any successful action by
SCI against CITIBANK, any Co-Agent or any Bank for a breach of its obligations
hereof, but nothing in this proviso shall modify or impair CITIBANK's, any
Co-Agent's or any Bank's rights under Section 11(b) hereof), (v) allegations of
participation or interference by CITIBANK, any Co-Agent or any Bank in the
management, contractual relations or other affairs of SCI (provided that the
right of payment and indemnification under this clause (v) shall not apply to
any liabilities, losses, costs and expenses arising out of any successful action
by SCI against CITIBANK, any Co-Agent or any Bank for a breach of its
obligations hereof, but nothing in this proviso shall modify or impair
CITIBANK's, any Co-Agent's or any Bank's rights under Section 11(b) hereof), or
(vi) allegations that CITIBANK, any Co-Agent or any Bank has joint liability
with SCI for any reason; provided that SCI will not be liable for such
liabilities, losses, claims, damages, penalties, causes of action, suits, costs
and expenses (including, without limitation, attorneys' fees and expenses) or
judgments of any arising from any untrue statement of a material fact in the
material relating to CITIBANK, any Co-Agent or any Bank in any offering circular
used in the sale of the Commercial Paper Notes or omission of a material fact
relating to CITIBANK, any Co-Agent or any Bank required to be stated therein or
necessary in order to make the statements therein relating to CITIBANK, any
Co-Agent or any Bank in the light of the circumstances under which they were
made not misleading if, but only if, such material was specifically approved in
writing by CITIBANK, such Co-Agent or such Bank, as the case may be, prior to
its inclusion in such offering circular; and further provided that SCI will not
be liable for any such liabilities, losses, claims, damages, penalties, causes
or action, suits, costs and expenses or judgments to the extent the same are the
result of or arise out of the gross negligence or willful misconduct of
CITIBANK, any Co-Agent or any Bank or any of the officers, directors,
shareholders, controlling persons, employees, agents and (of any of them) of
CITIBANK, any Co-Agent or any Bank. If any action, suit or proceeding arising
from any of the foregoing is brought against CITIBANK, any Co-Agent or any Bank
or any other person indemnified pursuant to this Section, SCI will, if requested
in writing by CITIBANK, any Co-Agent or any Bank to do so, at its expense,
resist and defend such action, suit or proceeding or cause the same to be
resisted and defended by counsel designated by SCI (which counsel shall be
satisfactory to CITIBANK, the Co-Agent involved and the Bank(s) involved). Each
of SCI's obligations under this Section 11(a) shall survive the termination of
this Agreement.
1.(b)SCI shall pay all reasonable out-of-pocket
costs and expenses of CITIBANK incurred in connection with the administration
of, the preservation of rights under, and enforcement of, and, after an Event of
Default, the re-negotiation or restructuring of this Agreement and any
amendment, waiver or consent relating thereto (including, the reasonable fees
and disbursements of counsel for CITIBANK). SCI shall also pay and hold CITIBANK
harmless from and against any and all present and future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies which
arise from any payment made hereunder or from the execution, delivery or
registration of, or otherwise with respect to this Agreement and save CITIBANK
harmless from and against any and all liabilities with respect to or resulting
from any delay or omission to pay any such taxes, charges or levies.
26. 11.FURTHER ASSURANCES. SCI agrees that it will do such acts and things
and promptly execute and deliver to CITIBANK such additional conveyances,
assignments, agreements and instruments as CITIBANK may reasonably require or
deem advisable to carry into effect the purposes of this Agreement or to further
assure and confirm unto CITIBANK its rights, powers and remedies hereunder.
27. 12.CITIBANK AS AGENT.
1.CITIBANK will hold in accordance with this
Agreement and the Credit Agreement all items of the Collateral at any time
received under this Agreement. It is expressly understood and agreed that the
obligations of CITIBANK as holder of the Collateral and interests therein and
with respect to the disposition thereof, and otherwise under this Agreement, are
only those expressly set forth in this Agreement, the Intercreditor Agreement,
and the Credit Agreement.
2.CITIBANK shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral in its
possession if the Collateral is accorded treatment substantially equal to that
which CITIBANK accords its own property, it being understood that CITIBANK shall
not have responsibility for (i) ascertaining or taking action with respect to
calls, conversions, exchanges, maturities, tenders or other matters relative to
any Collateral, whether or not CITIBANK has or is deemed to have knowledge of
such matters, or (ii) taking any necessary steps to preserve rights against any
parties with respect to any Collateral. 13.REPRESENTATIONS AND WARRANTIES. SCI
hereby represents and warrants that (i) it is the legal record and beneficial
owner of, and has good and marketable title to, the Charged Stock described in
Section 2 hereof, subject to no pledge, lien, mortgage, hypothecation, security
interest, charge, option or other encumbrance whatsoever, except Liens and
security interests created by this Agreement or expressly permitted by this
Agreement or the Credit Agreement; (ii) it has full power, authority and legal
right to pledge all the Charged Stock pursuant to this Agreement; (iii) to the
best of its knowledge, no consent of any other party (including, without
limitation, any stockholder or creditor of CITIBANK or any of the Subsidiaries)
and no order, consent, license, permit, approval, validation or authorization
of, exemption by, notice to or registration, recording, filing or declaration
with, any governmental or public body or authority is required to be obtained by
SCI in connection with the execution, delivery or performance of this Agreement
or consummation of the transactions contemplated hereby, including, without
limitation, the exercise by CITIBANK of the voting or other rights provided for
in this Agreement or the remedies in respect of the Collateral pursuant to this
Agreement (except as may be required in connection with the disposition of the
Pledged Securities by laws affecting the offering and sale of securities
generally and except as set forth on Annex B attached hereto); (iv) all shares
of Charged Stock have been duly and validly issued, are fully paid and
non-assessable; and (v) to the best of its knowledge, except as set forth on
Annex B attached hereto, the pledge and delivery of the Charged Securities
pursuant to this Agreement creates a valid and perfected first priority security
interest in the Charged Securities, and the Charged Securities, and the proceeds
thereof, which security interest is not subject to any prior Lien or any
agreement purporting to grant to any third party a Lien on the property or
assets of SCI which would include the Charged Securities (other than the Lien of
the Intercreditor Agreement, if any, or any other
intercreditor agreement entered into pursuant to the Credit Agreement and Liens
expressly permitted by the Credit Agreement). 14.COVENANTS OF SCI. SCI covenants
and agrees that (i) SCI will defend CITIBANK's right, title and security
interest in and to the Charged Securities and the proceeds thereof against the
claims and demands of all Persons whomsoever; (ii) SCI will have like title to
and right to pledge any other property at any time hereafter pledged to CITIBANK
as Collateral hereunder and will likewise defend the right thereto and security
interest therein of CITIBANK; and (iii) SCI will not, with respect to any
Collateral, enter into any shareholder agreements, voting agreements, voting
trusts, trust deeds, irrevocable proxies or any other similar agreements or
instruments. 15.SCI'S OBLIGATIONS ABSOLUTE, ETC. The obligations of SCI under
this Agreement shall be absolute and unconditional in accordance with its terms
and shall remain in full force and effect without regard to, and shall not be
released, suspended, discharged, terminated or otherwise affected by, any
circumstance or occurrence whatsoever, including, without limitation: (a) any
change in the time, place or manner of payment of, or in any other term of, all
or any of the Secured Obligations, any waiver, indulgence, renewal, extension,
amendment or modification of or addition, consent or supplement to or deletion
from or any other action or inaction under or in respect of the Credit
Agreement, any Note, any other Credit Document, or any of the other documents,
instruments or agreements relating to the Secured Obligations or any other
instrument or agreement referred to therein or any assignment or transfer of any
thereof; (b) any lack of validity or enforceability of the Credit Agreement, any
other Credit Document, or any other documents, instruments or agreement referred
to therein or any assignment or transfer of any thereof; (c) any furnishing of
any additional security to CITIBANK, or its assignees or any acceptance thereof
or any release of any security by CITIBANK or its assignees; (d) any limitation
on any party's liability or obligations under any such instrument or agreement
or any invalidity or unenforceability, in whole or in part, of any such
instrument or agreement or any term thereof; (e) any bankruptcy, insolvency,
reorganization, composition, adjustment, dissolution, liquidation or other like
proceeding relating to SCI or any of the Subsidiaries, or any action taken with
respect to this Agreement by any trustee or receiver, or by any court, in any
such proceeding, whether or not SCI shall have notice or knowledge of any of the
foregoing; or (f) any exchange, release or nonperfection of any other
collateral, or any release, amendment or waiver of or consent to departure from
any guaranty or security, for all or any of the Secured Obligations.
16.REGISTRATION, ETC.
1.If an Event of Default shall have occurred and be
continuing and SCI shall have received from CITIBANK a written request or
requests that SCI cause any registration, qualification or compliance under any
Federal or state securities law or laws to be effected with respect to all or
any part of the Charged Securities, SCI as soon as practicable and at its own
expense will use its best efforts to cause such registration to be effected (and
be kept effective) and will use its best efforts to cause such qualification and
compliance to be effected (and be kept effective) as may be so requested and as
would permit or facilitate the sale and distribution of such Charged Securities,
including, without limitation, registration under the Securities Act of 1933 as
then in effect (or any similar statute then in effect), appropriate
qualifications under applicable blue sky or other state securities laws and
appropriate compliance with any other government requirements, and reasonably do
or cause to be done all such other acts and things as may be necessary to permit
the sale of the Charged Securities to be made in compliance with Federal and
applicable State securities laws; provided, that CITIBANK shall furnish to SCI
such information regarding CITIBANK as SCI may reasonably request in writing and
as shall be required in connection with any such registration, qualification or
compliance. SCI will cause CITIBANK to be kept reasonably advised in writing as
to the progress of each such registration, qualification or compliance and as to
the completion thereof, will furnish to CITIBANK such number of prospectuses,
offering circulars or other documents incident thereto as CITIBANK from time to
time may reasonably request, and will indemnify CITIBANK and all others
participating in the distribution of such Charged Securities against all claims,
losses, damages and liabilities caused by any untrue statement (or alleged
untrue statement) of a material fact contained therein (or in any related
registration statement, notification or the like) or by any omission (or alleged
omission) to state therein (or in any related transaction statement,
notification or the like) a material fact required to be stated therein or
necessary to make the statements not misleading in light of the circumstances
under which they were made, except insofar as the same may have been caused by
an untrue statement or omission based upon information furnished in writing to
SCI by CITIBANK, or such others participating in the distribution of such
Charged Securities, expressly for use therein.
2.If at any time when CITIBANK shall determine to
exercise its right to sell all or any part of the Charged Securities pursuant to
Section 7, such Charged Securities or the part thereof to be sold shall not, for
any reason whatsoever, be effectively registered under the Securities Act of
1933, as then in effect, CITIBANK may sell such Charged Securities or part
thereof by private sale in such manner and under such circumstances as necessary
or advisable in order that such sale may legally be effected without such
registration. Without limiting the generality of the foregoing, in any such
event CITIBANK, in its sole discretion (i) may proceed to make such private sale
notwithstanding that a registration statement for the purpose of registering
such Charged Securities or part thereof shall have been filed under such
Securities Act, (ii) may approach and negotiate with a single possible purchaser
to effect such sale, and (iii) may restrict such sale to a purchaser or
purchasers who will represent and agree that such purchaser is purchasing for
its own account, for investment, and not with a view to the distribution or sale
of such Charged Securities or part thereof. In the event of any such sale,
CITIBANK shall incur no responsibility or liability for selling all or any part
of the Charged Securities at a price which CITIBANK, in its sole discretion, may
in good xxxxx xxxx reasonable under the circumstances, notwithstanding the
possibility that a substantially higher price might be realized if the sale were
deferred until after registration as aforesaid. 17.NOTICES, ETC. All notices and
other communications shall be given in the manner specified in Section 15.02 of
the Credit Agreement in the case of CITIBANK, and in the case of SCI, at the
address specified in this Agreement. 18.POWER OF ATTORNEY. SCI hereby absolutely
and irrevocably constitutes and appoints CITIBANK SCI's true and lawful agent
and attorney-in-fact, effective upon the occurrence of an Event of Default, with
full power of substitution, in the name of
SCI: (a) to execute and do all such assurances, acts and things which SCI ought
to do but has failed to do under the covenants and provisions contained in this
Agreement; (b) to take any and all such action as CITIBANK may, in its sole
discretion, determine as necessary or advisable for the purpose of maintaining,
preserving or protecting the security constituted by this Agreement or any of
the rights, remedies, powers or privileges of CITIBANK under this Agreement; and
(c) generally, in the name of SCI exercise all or any of the powers,
authorities, and discretions conferred on or reserved to CITIBANK by or pursuant
to this Agreement, and (without prejudice to the generality of any of the
foregoing) to seal and deliver or otherwise perfect any instrument or document
of conveyance, agreement, or act as CITIBANK may deem proper in or for the
purpose of exercising any of such powers, authorities or discretions. SCI hereby
ratifies and confirms, and hereby agrees to ratify and confirm, whatever lawful
acts CITIBANK shall do or purport to do in the exercise of the power of attorney
granted to CITIBANK pursuant to this Section 19, which power of attorney, being
given for security, is irrevocable. 19.TERMINATION, RELEASE. After full
indefeasible payment and performance of all of the Secured Obligations other
than Secured Obligations which by their terms survive the repayment of the Loans
and irrevocable termination of the Total Commitments, this Agreement shall
terminate, and CITIBANK, at the request and expense of SCI, will execute and
deliver to SCI a proper instrument or instruments acknowledging the satisfaction
and termination of this Agreement, and will duly assign, transfer and deliver to
SCI (without recourse and without any representation or warranty) such of the
Collateral as may be in the possession of CITIBANK and as has not theretofore
been sold or otherwise applied or released pursuant to this Agreement, together
with any moneys at the time held by CITIBANK hereunder.
MISCELLANEOUS.
21.A.Independent Obligations. SCI agrees with CITIBANK that each of the
obligations and liabilities of SCI to CITIBANK under this Agreement may be
enforced against SCI without the necessity of joining the Borrower, any of the
Subsidiaries, any other holders of pledges of or security interests in any of
the Collateral, or any other Person as a party. 21.B.Reaffirmation. SCI hereby
acknowledges agrees that each of the 1995 Pledge Agreement and the First
Supplemental Pledge Agreement is in full force and effect as of the date hereof
and has not been rescinded, terminated or revoked by SCI prior to the date
hereof, and each of the 1995 Pledge Agreement and the First Supplemental Pledge
Agreement shall remain in full force and effect after giving effect to this
Agreement. 21.C. Successors and Assigns. This Agreement shall create a
continuing security interest in the Collateral and shall be binding upon the
successors and assigns of SCI and shall inure to the benefit of and be
enforceable by CITIBANK, and its successors and permitted assigns.
21.D.Amendments, Etc. This Agreement may be amended or waived only with the
written consent of the Required Banks and, with respect to any amendment, SCI.
21.E.Other Definitions. Unless otherwise defined herein or in the Credit
Agreement, terms defined in Article 9 of the Code in the State of New York are
used herein as therein defined.
21.F.Headings; Entire Agreement. The headings in this Agreement are for purposes
of reference only and shall not limit or define the meaning hereof. This
Agreement, together with all instruments, certificates and documents executed or
delivered by the parties in connection herewith or with reference hereto,
embodies the entire understanding and agreement between the parties hereto with
respect to the Collateral and supersedes all prior agreements, understandings
and inducements, whether expressed or implied, or oral or written.
21.G.Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall be an original, but all of which shall constitute one
instrument. 21.H.Severable Provisions. In the event that any provision of this
Agreement shall prove to be invalid or unenforceable, such provision shall be
deemed to be severable from the other provisions of this Agreement which shall
remain binding on all parties hereto. 22.GOVERNING LAW. This Agreement and the
rights and obligations of the parties hereunder shall be construed in accordance
with and be governed by the law of the State of New York (without giving effect
to the conflict of law principles thereof). JURISDICTION; WAIVER OF JURY TRIAL.
SCI HEREBY (1) AGREES THAT ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR TO ENFORCE ANY JUDGMENT OBTAINED AGAINST SCI IN CONNECTION WITH
THIS AGREEMENT BE BROUGHT BY CITIBANK, ANY THE CO-AGENT OR ANY BANK IN ANY COURT
SITTING IN THE STATE OF NEW YORK; (2) IRREVOCABLY SUBMITS TO THE NONEXCLUSIVE
JURISDICTION OF UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK AND OF ANY COURT OF THE STATE OF NEW YORK FOR THE PURPOSES OF ALL LEGAL
PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT; (3) AGREES THAT
SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAWS OF THE STATE OF NEW
YORK SHALL APPLY TO THIS ASSIGNMENT AND THE CREDIT DOCUMENTS; AND (4)
IRREVOCABLY WAIVES ANY PRESENT OR FUTURE OBJECTION TO VENUE IN ANY SUCH COURT,
AND ANY PRESENT OR FUTURE CLAIM THAT ANY SUCH COURT IS AN INCONVENIENT FORUM, IN
CONNECTION WITH ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT. IN WITNESS
WHEREOF, SCI and CITIBANK have caused this Agreement to be executed by their
duly elected officers duly authorized as of the date first above written.
Address for Notices:
SCI SYSTEMS, INC.
c/o SCI Systems (Alabama), Inc.
0000 X. Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
SCI SYSTEMS, INC., as SCI
By:
Name:
Title:
CITIBANK, N.A., as Agent, as
CITIBANK
By:
Name:
Title:
ANNEX A
Name of Name of Name of Percentage of Percentage of
Corporation Shares Shares Shares Shares
Owned Charged Owned Charged
----------- -------- --------- ------------- 66%
----------- -------- --------- ------------- 66%
----------- -------- --------- ------------- 66%
----------- -------- --------- ------------- 66%
----------- -------- --------- ------------- 66%
----------- -------- --------- ------------- 66%
ANNEX B
EXCEPTIONS TO PLEDGE
CONFIRMATION OF GUARANTY AND
REAFFIRMATION OF PLEDGE AGREEMENT
Reference is hereby made to the Amended and Restated Credit Agreement (the
"Credit Agreement") dated as of August 3, 1995 among SCI SYSTEMS, INC., a
Delaware corporation (the "Borrower"), CITIBANK, N.A., as Agent (the "Agent"),
ABN AMRO BANK, N.V., as Co-Agent (the "Co-Agent"), and the banks who are parties
to such Credit Agreement (collectively, the "Banks"). In order to induce the
Agent, the Co-Agent and the Banks (collectively, the "Guaranteed Parties") to
enter into that certain Fifth Modification of Amended and Restated Credit
Agreement of even date among the Borrower, the Agent, the Co-Agent and the Banks
(the "Fifth Modification"), as well as for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, each
of the undersigned (individually a "Guarantor" and collectively, the
"Guarantors") hereby acknowledges and agrees in favor of the Guaranteed Parties
as follows: 1.SCI Colorado, Inc., a Colorado corporation ("SCI Colorado"), is
indebted to the Guaranteed Parties under the terms of that certain Guaranty
Agreement, dated as of June 28, 1996, executed by SCI Colorado in favor of the
Guaranteed Parties (the "SCI Colorado Guaranty"). 2.Each Guarantor (other than
SCI Colorado) is indebted to the Guaranteed Parties under the terms of that
certain Amended and Restated Guaranty Agreement, dated as of August 3, 1995,
executed by such Guarantors in favor of the Guaranteed Parties (the "1995
Guaranty", the SCI Colorado Guaranty and the 1995 Guaranty are hereinafter
collectively called the "Guaranties").
3.Each of the Guaranties to which a Guarantor is a party is in full force and
effect as of the date hereof, has not been amended, rescinded, revoked or
terminated by any Guarantor a party thereto through the date hereof, and
continues to constitute the legal, valid and binding obligation of such
Guarantor, enforceable against such Guarantor in accordance with its terms, and
each Guarantor hereby confirms and reaffirms all of its obligations and
liabilities to the Guaranteed Parties under the Guaranty executed by it. 4.All
indebtedness, obligations and liabilities of the Borrower to the Guaranteed
Parties which may now or hereafter arise under or by reason of the Credit
Agreement described above, as amended, including without limitation, the
Borrower's obligations arising under the Fifth Modification, constitute part of
the "Guaranteed Obligations" of the Borrower to the Guaranteed Parties which is
guaranteed by each Guarantor under the terms and conditions of the Guaranty
executed by it. 5.Each Guarantor Hereby consents to and approves the execution,
delivery and performance of the Fifth Modification and all of the transactions
contemplated thereby. 6.Each Guarantor which has executed a Pledge Agreement (as
defined in the Credit Agreement) does hereby reaffirm all of its indebtedness,
obligations and liabilities to the Agent, the Co-Agent and the Banks under the
Pledge Agreement executed by it and does hereby reaffirm the grant of any and
all liens in the Collateral under (and as such term is defined in) such Pledge
Agreement); provided, however, that nothing in this Confirmation is intended or
shall be construed, to constitute a novation of any such indebtedness,
obligations or liabilities or to modify, effect, release or otherwise impair the
continuity or perfection of such liens. 7.Each Guarantor which executed a Pledge
Agreement also confirms and agrees that the Pledge Agreement executed by it
remains in full force and effect after giving effect to the execution, delivery
and performance of the Fifth Modification and continues to secure all Secured
Obligations (as defined in such Pledge Agreement). 8.THIS CONFIRMATION SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE. IN WITNESS
WHEREOF, each Guarantor has caused its duly authorized officers to execute this
Confirmation, all as of this __________ of September, 1998.
SCI SYSTEMS (ALABAMA), INC.
By:
Name:
Title:
SCIMEX, INC.
By:
Name:
Title:
SCI TECHNOLOGY, INC.
By:
Name:
Title:
(Signatures continued on next page)
(Signatures continued from preceding page)
INTERAGENCY, INC.
By:
Name:
Title:
SCI HOLDINGS, INC.
By:
Name:
Title:
SCI FOREIGN SALES, INC.
By:
Name:
Title:
NEWPORT, INC.
By:
Name:
Title:
SCI COLORADO, INC.
By:
Name:
Title:
SUBSIDIARY (INTERCOMPANY) NOTE
$410,000,000 March 18, 1999
FOR VALUE RECEIVED, the undersigned promises to pay to the order of SCI
Systems, Inc., a Delaware corporation (the "Parent"), or any subsidiary thereof
(a "Subsidiary", and together with the Parent or any other holder hereof, the
"Holder") at its registered office in Wilmington, Delaware (or at such other
place as the Holder may designate in writing to the undersigned) the principal
amount of FOUR HUNDRED TEN MILLION AND NO/100 U.S. DOLLARS ($410,000,000) or so
much thereof as has been advanced to the undersigned by each payee hereunder,
plus interest as hereinafter provided. The principal amount of this Subsidiary
Note shall be due and payable in the amounts and at the times determined by the
Holder to be necessary to allow the Parent to make any payment of principal due
and payable under the Notes (as such term is defined in the Amended and Restated
Credit Agreement (as amended, extended, modified or supplemented from time to
time, the "Credit Agreement"), dated as of August 3, 1995, by and among the
Parent, Citibank, N.A., as agent (the "Agent"), ABN AMRO Bank N.V. and Bank of
America (Illinois), as Co-Agents, and the Banks (the "Banks") which are
signatories to such Credit Agreement, and any assignees which become Banks under
such Credit Agreement). The undersigned shall pay interest on the principal
amount outstanding hereunder from time to time at the effective rate of interest
being paid by the Parent under the Notes and the Credit Agreement. Interest
hereunder shall be due and payable as and when interest from the Parent is due
under the Credit Agreement in an amount determined by the Holder, based on the
ratio of the amount outstanding hereunder at
the time of any interest payment, to the total amount outstanding under the
Credit Agreement from the Parent. Any payment of principal or interest which is
not timely made shall bear interest at a per annum rate equal to the interest
rate for overdue advances provided in the Credit Agreement. It is contemplated
that the original principal sum evidenced by this Subsidiary Note may be reduced
from time to time and that additional advances may be made from time to time. In
no event shall the amount of interest due or payable hereunder exceed the
maximum rate of interest allowed by applicable law, and in the event any such
payment is inadvertently paid by the undersigned or inadvertently received by
the Holder, then such excess sum shall be credited as a payment of principal,
unless the undersigned shall notify the Holder, in writing, that the undersigned
elects to have such excess sum returned to it forthwith. It is the express
intent hereof that the undersigned not pay and the Holder not receive, directly
or indirectly, in any manner whatsoever, interest in excess of that which may be
lawfully paid by the undersigned under applicable law. Should any payment of
principal and interest not be paid when due under this Subsidiary Note, or
should an Event of Default occur under the Credit Agreement or any other
document or agreement executed and delivered in connection herewith or
therewith, then, and at any time thereafter, the Holder shall have the right and
option, in its sole discretion, to declare the principal and interest
outstanding hereunder to be forthwith due and payable. All parties now or
hereafter liable with respect to this Subsidiary Note, whether the undersigned,
any guarantor, endorser or any other person or entity, hereby expressly waive
presentation, demand of payment, protest, notice of demand of payment, protest
and notice of non-payment, or any other notice of any kind with respect hereto.
No delay or failure on the part of the Holder in the exercise of any right or
remedy hereunder, under any loan agreement or security agreement, or at law or
in equity, shall operate as a waiver thereof, and no single or partial exercise
by the Holder of any right or remedy hereunder, under any loan agreement or
security agreement, or at law or in equity shall preclude or estop another or
further exercise thereof or the exercise of any other right or remedy. Principal
and interest on this Subsidiary Note shall be payable and paid in lawful money
of the United States of America. Time is of the essence of this Subsidiary Note
and, in case this Subsidiary Note is collected by or through an attorney at law,
or under advice therefrom, the undersigned agrees to pay all costs of collection
including reasonable attorneys' fees. The provisions of this Subsidiary Note
shall be construed and interpreted and all rights and obligations of the parties
hereunder determined in accordance with the laws of the State of New York. THIS
SUBSIDIARY NOTE IS SUBJECT TO THE TERMS AND CONDITIONS OF THAT CERTAIN AMENDED
AND RESTATED ASSIGNMENT OF INTERCOMPANY LOANS DATED AS OF AUGUST 3, 1995, AS
AMENDED AND SUPPLEMENTED FROM TIME TO TIME, BY AND AMONG THE AGENT, THE
UNDERSIGNED AND ITS AFFILIATES.
SECOND SUPPLEMENTAL AMENDED AND RESTATED
SECURITY AGREEMENT
THIS SECOND SUPPLEMENTAL AMENDED AND RESTATED SECURITY AGREEMENT (this
"Agreement"), dated as of _____________, 1999, made by SCI SYSTEMS, INC., a
Delaware corporation (the "SCI"), to CITIBANK, N.A. ("CITIBANK"), acting in its
capacity as agent for CITIBANK, ABN AMRO Bank N.V. ("ABN AMRO") and Bank of
America Illinois (collectively, the "Co-Agents") and the banks and other lending
institutions (the "Banks") which are signatories to the Amended and Restated
Credit Agreement dated as of August 3, 1995, among SCI Systems, Inc. (the
"Borrower"), CITIBANK, the Co-Agents and the Banks, and acting as Agent for any
assignees which become Banks as provided in such Amended and Restated Credit
Agreement. W I T N E S S E T H: WHEREAS, pursuant to the Amended and Restated
Credit Agreement described above (as the same may be amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement";
the terms defined in the Credit Agreement and not otherwise defined herein are
used herein with the same meaning), CITIBANK, the Co-Agents and the Banks have
committed to loan certain amounts to, and ABN AMRO, in its capacity as Co-Agent
(acting for the Banks) has amended the Letter of Credit for the benefit of, the
Borrower; and WHEREAS, pursuant to the Credit Agreement, SCI entered into a
certain amended and restated stock pledge and security agreement dated as of
August 3, 1995 (the "1995 Pledge Agreement") and a first supplemental amended
and restated stock pledge and security agreement dated as of March __, 1998 (the
"First Supplemental Pledge Agreement"); and WHEREAS, it is a condition precedent
to the Banks' obligations to continue to make Loans to the Borrower under the
Credit Agreement that SCI execute and deliver to CITIBANK this Agreement (which
shall supplement the 1995 Pledge Agreement executed by SCI at the initial
closing of the Credit Agreement and also supplement the First Supplemental
Pledge Agreement); WHEREAS, SCI desires to execute this Agreement to satisfy the
condition described in the preceding paragraph; NOW, THEREFORE, in consideration
of the benefits accruing to SCI, the receipt and sufficiency of which are hereby
acknowledged, and in order to induce CITIBANK, the Co-Agents and the Banks to
continue to make Loans to the Borrower under the Credit Agreement SCI hereby
makes the following representations and warranties to CITIBANK and hereby
covenants and agrees with CITIBANK as follows:
0.XXXXXXXX FOR OBLIGATIONS ETC. This Agreement is for the benefit of CITIBANK to
secure the prompt payment in full when due, whether at stated maturity, by
acceleration or otherwise, of (i) the Loans, the Notes, SCI's reimbursement
obligations in respect of the Letter of Credit and all other Obligations
(whether for principal, interest, fees, expenses or otherwise), (ii) all
obligations of SCI now or hereafter existing under the Credit Agreement or under
this Agreement (whether for principal, interest, fees, expenses or otherwise) or
under any Interest Rate Contracts, and (iii) all costs and expenses incurred by
CITIBANK or any Bank in connection with the exercise of its rights and remedies
hereunder (including reasonable attorneys' fees) (all such obligations
collectively being the "Secured Obligations"). 2.CHARGED STOCK. As used herein,
the term "Charged Stock" shall mean the number of issued and outstanding shares
specified on Annex A attached hereto which SCI owns of each class of capital
stock of the corporations identified on Annex A attached hereto (collectively,
the "Subsidiaries"). SCI represents and warrants that on the date hereof (a) the
Charged Stock consists of the number of shares of the stock of the Subsidiaries
as described in Annex A attached hereto; (b) SCI is the holder of record and
sole beneficial owner of such Charged Stock; and (c) the Charged Stock
constitutes the percentage of the issued and outstanding stock of the
Subsidiaries indicated on Annex A. CHARGE OF SECURITIES, ETC. 3.A.Charge. To
secure the Secured Obligations and for the purposes set forth in Section 1, SCI
hereby charges to CITIBANK (for and on behalf of CITIBANK, the Co-Agents and the
Banks), and grants a security interest in, the Charged Stock, together with (i)
the certificates representing such Charged Stock accompanied by stock powers
duly executed in blank by SCI, and (ii) subject to the rights of SCI set forth
in Section 6, all dividends (whether in cash, stock, warrants, options, or other
securities), cash, instruments or other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any and all
of the Charged Stock; and hereby assigns, transfers, hypothecates and sets over
to CITIBANK all of SCI's right, title and interest in and to the Charged
Securities (and in and to the certificates or instruments evidencing the items
described in clauses (i) and (ii) above) to be held by CITIBANK, upon the terms
and conditions set forth in this Agreement. Subject to the terms of the
Intercreditor Agreement, SCI agrees to deliver to CITIBANK all certificates and
instruments evidencing the items described in clause (ii) above promptly upon
SCI's receipt thereof. 3.B.Definition of Charged Securities and Collateral. The
Charged Stock and all items described in clause (ii) of Section 3.1 are
hereinafter called the "Charged Securities," and the Charged Securities,
together with all other securities and moneys received and at the time held by
CITIBANK hereunder and any proceeds of any of the foregoing, are hereinafter
called the "Collateral." 4.APPOINTMENT OF SUB-AGENTS; ENDORSEMENTS, ETC.
CITIBANK shall have the right to appoint one or more agents for the purpose of
retaining physical possession of the Collateral, which may be held (if
applicable and in the discretion of CITIBANK) in the name of SCI, endorsed or
assigned in blank or in favor of CITIBANK or any nominee or nominees of CITIBANK
or an agent appointed by CITIBANK. 0.XXXXXX, ETC. Unless and until an Event of
Default (such term to mean an Event of Default as defined herein) shall have
occurred and be continuing, SCI shall be entitled to vote any and all Charged
Stock and to give consents, waivers or ratifications in respect thereof;
provided that no vote shall be cast or any consent, waiver or ratification given
or any action taken which would violate or be inconsistent with any of the terms
of this Agreement, the Credit Documents, or any instrument or agreement relating
to the Obligations; provided, further, that the SCI shall give CITIBANK at least
five (5) Business Days, written notice of the manner in which it intends to
exercise, or the reasons for refraining from exercising, any such right if the
exercise or non-exercise of such right potentially may violate or be
inconsistent with the aforementioned agreements. All such rights of SCI to vote
and to give consents, waivers and ratifications shall cease in case an Event of
Default shall occur and be continuing, and Section 7 hereof shall become
applicable. 6. A DIVIDENDS AND OTHER DISTRIBUTIONS. Unless an Event of Default
shall have occurred and be continuing, all cash dividends payable in respect of
the Charged Securities shall be paid to SCI, but only to the extent (if any)
permitted by the Credit Agreement. CITIBANK shall also be entitled to receive
directly, and to retain as part of the Collateral:
1.(a)all other or additional stock or securities paid or
distributed by way of dividend in respect of the Charged Securities;
2.(b)all other or additional stock or other
securities paid or distributed in respect of the Charged Securities by way of
stock-split, spin-off, split-up, reclassification, combination of shares or
similar rearrangement; and
3.(c)all other or additional stock or other
securities which may be paid in respect of the Charged Securities by reason of
any consolidation, merger, exchange of stock, conveyance of assets, liquidation
or similar corporate reorganization.
1. 6.B Additional Shares. SCI agrees and covenants that it will cause the
Subsidiaries not to issue any stock or other securities in addition to or in
substitution for the Charged Securities except stock or other securities which
are either (i) issued to SCI and pledged to CITIBANK pursuant to this Agreement,
to the extent necessary to keep 66% of the issued and outstanding Charged Stock
pledged to CITIBANK hereunder and delivered to CITIBANK within two (2) business
days from the date of issuance or (ii) issued in a manner otherwise acceptable
to the Required Banks.
EVENTS OF DEFAULT.
7.A.Definition of Events of Default. Any of the following specified events shall
constitute an Event of Default under this Agreement:
1.(a)the existence or occurrence of any Event of
Default as provided under the terms of the Credit Agreement;
2.(b)any representation, warranty or statement
made or deemed to be made by SCI or any of its officers under or in connection
with this Agreement shall have been incorrect in any material respect when made
or deemed to be made;
3.(c)SCI shall fail to observe or perform any
covenant or agreement set forth in Section 6 (including Section 6.1), Section 1
or Section 17; or
4.(d)SCI shall fail to observe or perform any
covenant or agreement set forth in this Agreement, other than those referred to
in paragraph (c) above, and such failure remains unremedied until the first to
occur of the date forty-five (45) days after an Executive Officer first obtains
knowledge thereof or the date thirty (30) days after written notice thereof
shall have been given to SCI by any Bank. 7.B.Remedies. In case an Event of
Default shall have occurred and be continuing,
and subject to Section 7.3 hereof, CITIBANK shall be entitled to exercise all of
the rights, powers and remedies (whether vested in it by this Agreement, any
other Credit Document or by law and including, without limitation, all rights
and remedies of a secured party of a debtor in default under the Uniform
Commercial Code (the "Code") in effect in the State of New York at that time)
for the protection and enforcement of its rights in respect of the Collateral,
and CITIBANK shall be entitled (subject to the rights of any holders of first
priority pledges and security interests on any portions of the Collateral as
permitted by the terms of this Agreement), without limitation, to exercise any
or all of the following rights, which SCI hereby agrees to be commercially
reasonable: (a)to receive all amounts payable to SCI in respect of the
Collateral otherwise payable under Section 6 and to enforce the payment of the
Charged Securities and to exercise all of the rights, powers, and remedies of
SCI thereunder; (b)to transfer all or any part of the Collateral into CITIBANK's
name or the name of its nominee or nominees; (c)to vote all or any part of the
Collateral (whether or not transferred into the name of CITIBANK) and give all
consents, waivers and ratifications in respect of the Collateral and otherwise
act with respect thereto as though it were the outright owner thereof; (d)at any
time or from time to time to sell, assign and deliver, or grant options to
purchase, all or any part of the Collateral in one or more parcels, or any
interest therein, at any public or private sale at any exchange, broker's board
or at any of CITIBANK's offices or elsewhere, without demand of performance,
advertisement or notice of intention to sell or of the time or place of sale or
adjournment thereof or to redeem or otherwise (all of which are hereby expressly
and irrevocably waived by SCI), for cash, on credit or for other property, for
immediate or future delivery without any assumption of credit risk, and for such
price or prices and on such terms as CITIBANK in its sole discretion may
determine. SCI agrees that to the extent that notice of sale shall be required
by law that at least 10 days' written notice to SCI of the time and place of any
public sale or the time after which any private sale is to be made shall
constitute reasonable notification. CITIBANK shall not be obligated to make any
sale of Collateral regardless of notice of sale having been given. CITIBANK may
adjourn any public or private sale from time to time by announcement at the time
and place fixed therefor, and any such sale may, without further notice, be made
at the time and place to which it was so adjourned. SCI hereby waives and
releases to the fullest extent permitted by law any right or equity of
redemption with respect to the Collateral, whether before or after sale
hereunder, and all rights, if any, of marshaling the Collateral and any other
security for the Obligations or otherwise. At any such sale, unless prohibited
by applicable law, CITIBANK may bid for and purchase all or any part of the
Collateral so sold free from any such right or equity of redemption. CITIBANK
shall not be liable for failure to collect or realize upon any or all of the
Collateral or for any delay in so doing nor shall it be under any obligation to
take any action whatsoever with regard thereto; (e)to settle, adjust, compromise
and arrange all accounts, controversies, questions, claims and demands
whatsoever in relation to all or any part of the Collateral; (f)to execute all
contracts, agreements, documents and instruments to bring, defend and abandon
all such actions, suits and proceedings, and to take all other actions, in
relation to all or any part of the Collateral as CITIBANK in its sole discretion
may determine;
(g)to appoint managers, agents and officers for any of the purposes mentioned in
the foregoing provisions of this Section 7 and to dismiss the same, all as
CITIBANK in its sole discretion may determine; and (h)generally, to take all
such other action as CITIBANK may determine as incidental or conducive to any of
the matters or powers mentioned in the foregoing provisions of this Section 7
and which CITIBANK may or can do lawfully and to use the name of SCI for the
purposes aforesaid and in any proceedings arising therefrom. 7.C.Decisions
Relating to Exercise of Remedies. Notwithstanding anything in this Agreement to
the contrary, as provided in the Credit Agreement, CITIBANK shall exercise, or
shall refrain from exercising, any remedy provided for in Section 7B in
accordance with the terms of Section 11.01 of the Credit Agreement. Neither the
Co-Agents nor any Bank may exercise any remedies provided for herein.
7.DREMEDIES, ETC., CUMULATIVE. Each right, power and remedy of CITIBANK provided
for in this Agreement or any other Credit Document or now or hereafter existing
at law or in equity or by statute shall be cumulative and concurrent and shall
be in addition to every other such right, power or remedy. The exercise or
beginning of the exercise by CITIBANK of any one or more of the rights, powers
or remedies provided for in this Agreement or any other Credit Document or now
or hereafter existing at law or in equity or by statute or otherwise shall not
preclude the simultaneous or later exercise by CITIBANK of all such other
rights, powers or remedies, and no failure or delay on the part of CITIBANK to
exercise any such right, power or remedy shall operate as a waiver thereof. Any
Event of Default, or any event which with the passing of time or the giving of
notice might become an Event of Default, may be waived by written consent of the
Required Banks but any such waiver shall apply only to the specific occasion
which is the subject of such waiver and shall not apply to the occurrence of the
same or any similar event on any future occasion. 8.APPLICATION OF PROCEEDS. All
moneys collected by CITIBANK upon any sale or other disposition of the
Collateral, together with all other moneys received by CITIBANK hereunder, shall
be applied as follows (subject to the terms and conditions of the Intercreditor
Agreement and the rights of any holders of any first priority pledges and
security interests on any portions of the Collateral as permitted by the terms
of this Agreement): First, to the payment of the reasonable costs and expenses
of such sale, collection or other realization, including, without limitation,
reasonable attorneys' fees and all other expenses, liabilities and advances made
or incurred by CITIBANK in connection therewith; Second, to the payment of the
Secured Obligations then due so that each Bank shall receive under this Clause
Second payment of an amount equal to the product of (1) the total amount
available for payment under this Clause Second and (ii) a fraction, the
numerator of which is the total amount of Secured Obligations then due to such
Bank and the denominator of which is the total amount of all Secured Obligations
then outstanding; and Third, after payment in full of all Secured Obligations
then due, to SCI, or its successors or assigns, or to whomsoever may be lawfully
entitled to receive the same or as a court of competent jurisdiction may direct
any surplus then remaining from such proceeds.
9.PURCHASERS OF COLLATERAL. Upon any sale of any of the Collateral hereunder
(whether by virtue of the power of sale herein granted pursuant to judicial
process or otherwise), the receipt of CITIBANK or the officer making the sale
shall be a sufficient discharge to the purchaser or purchasers of the Collateral
so sold, and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to CITIBANK or such
officer or be answerable in any way for the misapplication or non-application
thereof. 10.INDEMNITY; EXPENSES. (a) SCI shall pay, and shall protect, indemnify
and save harmless CITIBANK, the Co-Agents and the Banks and, in their capacity
as such, the officers, directors, shareholders, controlling persons, employees,
agents, and servants of CITIBANK, any Co-Agent or any Bank from and against all
liabilities, losses, claim, damages, penalties, causes of action, suits, costs
and expenses (including, without limitation reasonable attorneys' fees and
expenses) or judgments of any nature arising from (i) the offering and sale of,
and payment or non-payment on, the Commercial Paper Notes or the issuance of the
Letter of Credit, (ii) the default of SCI or any other Credit Party or the
Depository in the performance of its respective agreements, rights or
obligations contained in this Agreement, the Depositary Agreement or any other
Credit Document entered into by SCI or such Credit Party or the Depositary in
connection herewith or therewith, (iii) any actual or proposed use of the
proceeds of the Loans or the Commercial Paper Notes or SCI's or any Credit
Party's entering into and performing any Credit Document or any Commercial Paper
Documents, (iv) CITIBANK's, any Co-Agent's or any Banks' making, holding or
administering the Loans, the Letter of Credit, the Credit Documents or any of
the Collateral pledged in connection with any Credit Document (provided that the
right of payment and indemnification under this clause (iv) shall not apply to
any liabilities, losses, costs and expenses arising out of any successful action
by SCI against CITIBANK, any Co-Agent or any Bank for a breach of its
obligations hereof, but nothing in this proviso shall modify or impair
CITIBANK's, any Co-Agent's or any Bank's rights under Section 11(b) hereof), (v)
allegations of participation or interference by CITIBANK, any Co-Agent or any
Bank in the management, contractual relations or other affairs of SCI (provided
that the right of payment and indemnification under this clause (v) shall not
apply to any liabilities, losses, costs and expenses arising out of any
successful action by SCI against CITIBANK, any Co-Agent or any Bank for a breach
of its obligations hereof, but nothing in this proviso shall modify or impair
CITIBANK's, any Co-Agent's or any Bank's rights under Section 11(b) hereof), or
(vi) allegations that CITIBANK, any Co-Agent or any Bank has joint liability
with SCI for any reason; provided that SCI will not be liable for such
liabilities, losses, claims, damages, penalties, causes of action, suits, costs
and expenses (including, without limitation, attorneys' fees and expenses) or
judgments of any arising from any untrue statement of a material fact in the
material relating to CITIBANK, any Co-Agent or any Bank in any offering circular
used in the sale of the Commercial Paper Notes or omission of a material fact
relating to CITIBANK, any Co-Agent or any Bank required to be stated therein or
necessary in order to make the statements therein relating to CITIBANK, any
Co-Agent or any Bank in the light of the circumstances under which they were
made not misleading if, but only if, such material was specifically approved in
writing by
CITIBANK, such Co-Agent or such Bank, as the case may be, prior to its inclusion
in such offering circular; and further provided that SCI will not be liable for
any such liabilities, losses, claims, damages, penalties, causes or action,
suits, costs and expenses or judgments to the extent the same are the result of
or arise out of the gross negligence or willful misconduct of CITIBANK, any
Co-Agent or any Bank or any of the officers, directors, shareholders,
controlling persons, employees, agents and (of any of them) of CITIBANK, any
Co-Agent or any Bank. If any action, suit or proceeding arising from any of the
foregoing is brought against CITIBANK, any Co-Agent or any Bank or any other
person indemnified pursuant to this Section, SCI will, if requested in writing
by CITIBANK, any Co-Agent or any Bank to do so, at its expense, resist and
defend such action, suit or proceeding or cause the same to be resisted and
defended by counsel designated by SCI (which counsel shall be satisfactory to
CITIBANK, the Co-Agent involved and the Bank(s) involved). Each of SCI's
obligations under this Section 11(a) shall survive the termination of this
Agreement.
1.(b)SCI shall pay all reasonable out-of-pocket
costs and expenses of CITIBANK incurred in connection with the administration
of, the preservation of rights under, and enforcement of, and, after an Event of
Default, the re-negotiation or restructuring of this Agreement and any
amendment, waiver or consent relating thereto (including, the reasonable fees
and disbursements of counsel for CITIBANK). SCI shall also pay and hold CITIBANK
harmless from and against any and all present and future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies which
arise from any payment made hereunder or from the execution, delivery or
registration of, or otherwise with respect to this Agreement and save CITIBANK
harmless from and against any and all liabilities with respect to or resulting
from any delay or omission to pay any such taxes, charges or levies. 11.FURTHER
ASSURANCES. SCI agrees that it will do such acts and things and promptly execute
and deliver to CITIBANK such additional conveyances, assignments, agreements and
instruments as CITIBANK may reasonably require or deem advisable to carry into
effect the purposes of this Agreement or to further assure and confirm unto
CITIBANK its rights, powers and remedies hereunder. 12.CITIBANK AS AGENT.
1.CITIBANK will hold in accordance with this
Agreement and the Credit Agreement all items of the Collateral at any time
received under this Agreement. It is expressly understood and agreed that the
obligations of CITIBANK as holder of the Collateral and interests therein and
with respect to the disposition thereof, and otherwise under this Agreement, are
only those expressly set forth in this Agreement, the Intercreditor Agreement,
and the Credit Agreement.
2.CITIBANK shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral in its
possession if the Collateral is accorded treatment substantially equal to that
which CITIBANK accords its own property, it being understood that CITIBANK shall
not have responsibility for (i) ascertaining or taking action with respect to
calls, conversions, exchanges, maturities, tenders or other matters relative to
any Collateral, whether or not CITIBANK has or is deemed to have knowledge of
such matters, or (ii) taking any necessary steps to preserve rights against any
parties with respect to any Collateral. 13.REPRESENTATIONS AND WARRANTIES. SCI
hereby represents and
warrants that (i) it is the legal record and beneficial owner of, and has good
and marketable title to, the Charged Stock described in Section 2 hereof,
subject to no pledge, lien, mortgage, hypothecation, security interest, charge,
option or other encumbrance whatsoever, except Liens and security interests
created by this Agreement or expressly permitted by this Agreement or the Credit
Agreement; (ii) it has full power, authority and legal right to pledge all the
Charged Stock pursuant to this Agreement; (iii) to the best of its knowledge, no
consent of any other party (including, without limitation, any stockholder or
creditor of CITIBANK or any of the Subsidiaries) and no order, consent, license,
permit, approval, validation or authorization of, exemption by, notice to or
registration, recording, filing or declaration with, any governmental or public
body or authority is required to be obtained by SCI in connection with the
execution, delivery or performance of this Agreement or consummation of the
transactions contemplated hereby, including, without limitation, the exercise by
CITIBANK of the voting or other rights provided for in this Agreement or the
remedies in respect of the Collateral pursuant to this Agreement (except as may
be required in connection with the disposition of the Pledged Securities by laws
affecting the offering and sale of securities generally and except as set forth
on Annex B attached hereto); (iv) all shares of Charged Stock have been duly and
validly issued, are fully paid and non-assessable; and (v) to the best of its
knowledge, except as set forth on Annex B attached hereto, the pledge and
delivery of the Charged Securities pursuant to this Agreement creates a valid
and perfected first priority security interest in the Charged Securities, and
the Charged Securities, and the proceeds thereof, which security interest is not
subject to any prior Lien or any agreement purporting to grant to any third
party a Lien on the property or assets of SCI which would include the Charged
Securities (other than the Lien of the Intercreditor Agreement, if any, or any
other intercreditor agreement entered into pursuant to the Credit Agreement and
Liens expressly permitted by the Credit Agreement). 14.COVENANTS OF SCI. SCI
covenants and agrees that (i) SCI will defend CITIBANK's right, title and
security interest in and to the Charged Securities and the proceeds thereof
against the claims and demands of all Persons whomsoever; (ii) SCI will have
like title to and right to pledge any other property at any time hereafter
pledged to CITIBANK as Collateral hereunder and will likewise defend the right
thereto and security interest therein of CITIBANK; and (iii) SCI will not, with
respect to any Collateral, enter into any shareholder agreements, voting
agreements, voting trusts, trust deeds, irrevocable proxies or any other similar
agreements or instruments. 15.SCI'S OBLIGATIONS ABSOLUTE, ETC. The obligations
of SCI under this Agreement shall be absolute and unconditional in accordance
with its terms and shall remain in full force and effect without regard to, and
shall not be released, suspended, discharged, terminated or otherwise affected
by, any circumstance or occurrence whatsoever, including, without limitation:
(a) any change in the time, place or manner of payment of, or in any other term
of, all or any of the Secured Obligations, any waiver, indulgence, renewal,
extension, amendment or modification of or addition, consent or supplement to or
deletion from or any other action or inaction under or in respect of the Credit
Agreement, any Note, any other Credit Document, or any of the other documents,
instruments or agreements relating to the Secured Obligations or any other
instrument or agreement referred to therein or any assignment or transfer of any
thereof; (b) any lack of validity or enforceability of the Credit Agreement, any
other Credit Document, or any other documents, instruments or agreement referred
to therein or any assignment or transfer of any thereof; (c) any furnishing of
any additional security to CITIBANK, or its assignees or any acceptance thereof
or any release of any security by CITIBANK or its assignees; (d) any limitation
on any party's liability or obligations under any such instrument or agreement
or any invalidity or unenforceability, in whole or in part, of any such
instrument or agreement or any term thereof; (e) any bankruptcy, insolvency,
reorganization, composition, adjustment, dissolution, liquidation or other like
proceeding relating to SCI or any of the Subsidiaries, or any action taken with
respect to this Agreement by any trustee or receiver, or by any court, in any
such proceeding, whether or not SCI shall have notice or knowledge of any of the
foregoing; or (f) any exchange, release or nonperfection of any other
collateral, or any release, amendment or waiver of or consent to departure from
any guaranty or security, for all or any of the Secured Obligations.
16.REGISTRATION, ETC.
1.If an Event of Default shall have occurred and be
continuing and SCI shall have received from CITIBANK a written request or
requests that SCI cause any registration, qualification or compliance under any
Federal or state securities law or laws to be effected with respect to all or
any part of the Charged Securities, SCI as soon as practicable and at its own
expense will use its best efforts to cause such registration to be effected (and
be kept effective) and will use its best efforts to cause such qualification and
compliance to be effected (and be kept effective) as may be so requested and as
would permit or facilitate the sale and distribution of such Charged Securities,
including, without limitation, registration under the Securities Act of 1933 as
then in effect (or any similar statute then in effect), appropriate
qualifications under applicable blue sky or other state securities laws and
appropriate compliance with any other government requirements, and reasonably do
or cause to be done all such other acts and things as may be necessary to permit
the sale of the Charged Securities to be made in compliance with Federal and
applicable State securities laws; provided, that CITIBANK shall furnish to SCI
such information regarding CITIBANK as SCI may reasonably request in writing and
as shall be required in connection with any such registration, qualification or
compliance. SCI will cause CITIBANK to be kept reasonably advised in writing as
to the progress of each such registration, qualification or compliance and as to
the completion thereof, will furnish to CITIBANK such number of prospectuses,
offering circulars or other documents incident thereto as CITIBANK from time to
time may reasonably request, and will indemnify CITIBANK and all others
participating in the distribution of such Charged Securities against all claims,
losses, damages and liabilities caused by any untrue statement (or alleged
untrue statement) of a material fact contained therein (or in any related
registration statement, notification or the like) or by any omission (or alleged
omission) to state therein (or in any related transaction statement,
notification or the like) a material fact required to be stated therein or
necessary to make the statements not misleading in light of the circumstances
under which they were made, except insofar as the same may have been caused by
an untrue statement or omission based upon information furnished in writing to
SCI by CITIBANK, or such others participating in the distribution of such
Charged Securities, expressly for use therein.
2.If at any time when CITIBANK shall determine to
exercise its right to sell all or any part of the Charged Securities pursuant to
Section 7, such Charged Securities or the part thereof to be sold shall not, for
any reason whatsoever, be effectively registered under the Securities Act of
1933, as then in effect, CITIBANK may sell such Charged Securities or part
thereof by private sale in such manner and under such circumstances as necessary
or advisable in order that such sale may legally be effected without such
registration. Without limiting the generality of the foregoing, in any such
event CITIBANK, in its sole discretion (i) may proceed to make such private sale
notwithstanding that a registration statement for the purpose of registering
such Charged Securities or part thereof shall have been filed under such
Securities Act, (ii) may approach and negotiate with a single possible purchaser
to effect such sale, and (iii) may restrict such sale to a purchaser or
purchasers who will represent and agree that such purchaser is purchasing for
its own account, for investment, and not with a view to the distribution or sale
of such Charged Securities or part thereof. In the event of any such sale,
CITIBANK shall incur no responsibility or liability for selling all or any part
of the Charged Securities at a price which CITIBANK, in its sole discretion, may
in good xxxxx xxxx reasonable under the circumstances, notwithstanding the
possibility that a substantially higher price might be realized if the sale were
deferred until after registration as aforesaid. 17.NOTICES, ETC. All notices and
other communications shall be given in the manner specified in Section 15.02 of
the Credit Agreement in the case of CITIBANK, and in the case of SCI, at the
address specified in this Agreement. 18.POWER OF ATTORNEY. SCI hereby absolutely
and irrevocably constitutes and appoints CITIBANK SCI's true and lawful agent
and attorney-in-fact, effective upon the occurrence of an Event of Default, with
full power of substitution, in the name of SCI: (a) to execute and do all such
assurances, acts and things which SCI ought to do but has failed to do under the
covenants and provisions contained in this Agreement; (b) to take any and all
such action as CITIBANK may, in its sole discretion, determine as necessary or
advisable for the purpose of maintaining, preserving or protecting the security
constituted by this Agreement or any of the rights, remedies, powers or
privileges of CITIBANK under this Agreement; and (c) generally, in the name of
SCI exercise all or any of the powers, authorities, and discretions conferred on
or reserved to CITIBANK by or pursuant to this Agreement, and (without prejudice
to the generality of any of the foregoing) to seal and deliver or otherwise
perfect any instrument or document of conveyance, agreement, or act as CITIBANK
may deem proper in or for the purpose of exercising any of such powers,
authorities or discretions. SCI hereby ratifies and confirms, and hereby agrees
to ratify and confirm, whatever lawful acts CITIBANK shall do or purport to do
in the exercise of the power of attorney granted to CITIBANK pursuant to this
Section 19, which power of attorney, being given for security, is irrevocable.
19.TERMINATION, RELEASE. After full indefeasible payment and performance of all
of the Secured Obligations other than Secured Obligations which by their terms
survive the repayment of the Loans and irrevocable termination of the Total
Commitments, this Agreement shall terminate, and CITIBANK, at the request and
expense of SCI, will execute and deliver to SCI a proper instrument or
instruments acknowledging the satisfaction and termination of this Agreement,
and will duly assign,
transfer and deliver to SCI (without recourse and without any representation or
warranty) such of the Collateral as may be in the possession of CITIBANK and as
has not theretofore been sold or otherwise applied or released pursuant to this
Agreement, together with any moneys at the time held by CITIBANK hereunder.
MISCELLANEOUS.
21.A.Independent Obligations. SCI agrees with CITIBANK that each of the
obligations and liabilities of SCI to CITIBANK under this Agreement may be
enforced against SCI without the necessity of joining the Borrower, any of the
Subsidiaries, any other holders of pledges of or security interests in any of
the Collateral, or any other Person as a party. 21.B.Reaffirmation. SCI hereby
acknowledges agrees that each of the 1995 Pledge Agreement and the First
Supplemental Pledge Agreement is in full force and effect as of the date hereof
and has not been rescinded, terminated or revoked by SCI prior to the date
hereof, and each of the 1995 Pledge Agreement and the First Supplemental Pledge
Agreement shall remain in full force and effect after giving effect to this
Agreement. 21.C. Successors and Assigns. This Agreement shall create a
continuing security interest in the Collateral and shall be binding upon the
successors and assigns of SCI and shall inure to the benefit of and be
enforceable by CITIBANK, and its successors and permitted assigns.
21.D.Amendments, Etc. This Agreement may be amended or waived only with the
written consent of the Required Banks and, with respect to any amendment, SCI.
21.E.Other Definitions. Unless otherwise defined herein or in the Credit
Agreement, terms defined in Article 9 of the Code in the State of New York are
used herein as therein defined. 21.F.Headings; Entire Agreement. The headings in
this Agreement are for purposes of reference only and shall not limit or define
the meaning hereof. This Agreement, together with all instruments, certificates
and documents executed or delivered by the parties in connection herewith or
with reference hereto, embodies the entire understanding and agreement between
the parties hereto with respect to the Collateral and supersedes all prior
agreements, understandings and inducements, whether expressed or implied, or
oral or written. 21.G.Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be an original, but all of which shall
constitute one instrument. 21.H.Severable Provisions. In the event that any
provision of this Agreement shall prove to be invalid or unenforceable, such
provision shall be deemed to be severable from the other provisions of this
Agreement which shall remain binding on all parties hereto. 22.GOVERNING LAW.
This Agreement and the rights and obligations of the parties hereunder shall be
construed in accordance with and be governed by the law of the State of New York
(without giving effect to the conflict of law principles thereof). JURISDICTION;
WAIVER OF JURY TRIAL. SCI HEREBY (1) AGREES THAT ANY LEGAL ACTION OR PROCEEDING
WITH RESPECT TO THIS AGREEMENT OR TO ENFORCE ANY JUDGMENT OBTAINED AGAINST SCI
IN CONNECTION WITH THIS AGREEMENT BE BROUGHT BY CITIBANK, ANY THE CO-AGENT OR
ANY BANK IN ANY COURT SITTING IN THE STATE OF NEW YORK; (2) IRREVOCABLY SUBMITS
TO THE NONEXCLUSIVE JURISDICTION OF UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK AND OF ANY COURT OF THE STATE OF NEW YORK FOR THE
PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT;
(3) AGREES THAT SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAWS OF
THE STATE OF NEW YORK SHALL APPLY TO THIS ASSIGNMENT AND THE CREDIT DOCUMENTS;
AND (4) IRREVOCABLY WAIVES ANY PRESENT OR FUTURE OBJECTION TO VENUE IN ANY SUCH
COURT, AND ANY PRESENT OR FUTURE CLAIM THAT ANY SUCH COURT IS AN INCONVENIENT
FORUM, IN CONNECTION WITH ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT.
IN WITNESS WHEREOF, SCI and CITIBANK have caused this Agreement to be executed
by their duly elected officers duly authorized as of the date first above
written.
Address for Notices:
SCI SYSTEMS, INC.
c/o SCI Systems (Alabama), Inc.
0000 X. Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
SCI SYSTEMS, INC., as SCI
By:
Name:
Title:
CITIBANK, N.A., as Agent, as
CITIBANK
By:
Name:
Title:
ANNEX A
Name of Name of Name of Percentage of Percentage of
Corporation Shares Shares Shares Shares
Owned Charged Owned Charged
----------- -------- --------- ------------- 66%
----------- -------- --------- ------------- 66%
----------- -------- --------- ------------- 66%
----------- -------- --------- ------------- 66%
----------- -------- --------- ------------- 66%
----------- -------- --------- ------------- 66%
ANNEX B
EXCEPTIONS TO PLEDGE
IN WITNESS WHEREOF, the undersigned has caused this Subsidiary
Note to be executed, sealed and delivered by and through its duly authorized
representatives, as of the day and year first above written.
SCI SYSTEMS SWEDEN AB
By:
Name: Xxxxxxx Xxxxxxx
Title:
By:
Name:
Title:
REAFFIRMATION OF PLEDGE AGREEMENT
Reference is hereby made to the Amended and Restated Credit Agreement (the
"Credit Agreement") dated as of August 3, 1995 among SCI SYSTEMS, INC., a
Delaware corporation (the "Borrower"), CITIBANK, N.A., as Agent (the "Agent"),
ABN AMRO BANK, N.V., as Co-Agent (the "Co-Agent"), and the banks who are parties
to such Credit Agreement (collectively, the "Banks"). In order to induce the
Agent, the Co-Agent and the Banks to enter into that certain Fifth Modification
of Amended and Restated Credit Agreement of even date among the Borrower, the
Agent, the Co-Agent and the Banks (the "Fifth Modification"), as well as for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the Borrower hereby acknowledges and agrees in favor of the
Agent, the Co-Agent and the Banks as follows: 1.All capitalized terms used
herein and not otherwise defined herein shall have the meanings given such terms
in the Credit Agreement. 2.The Borrower does hereby reaffirm all of its
indebtedness, obligations and liabilities to the Agent, the Co-Agent and the
Banks under each Pledge Agreement executed by it and does hereby reaffirm the
grant of any and all liens in the collateral pledged by the Borrower under any
Pledge Agreement executed by it; provided, however, that nothing in this
Reaffirmation is intended or shall be construed, to constitute a novation of any
such indebtedness, obligations or liabilities or to modify, effect, release or
otherwise impair the continuity or perfection of such liens. 3.The Borrower also
confirms and agrees that each Pledge Agreement executed by it remains in full
force and effect after giving effect to the execution, delivery and performance
of the Fifth Modification and continues to secure all Secured Obligations (as
defined in each such Pledge Agreement). 4.THIS REAFFIRMATION SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK
APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE. IN WITNESS WHEREOF,
the Borrower has caused its duly authorized officers to execute this
Reaffirmation, all as of this _______ day of September, 1998.
SCI SYSTEMS, INC.
By:
Name:
Title:
