Exhibit 10.2
PLEDGE AND SECURITY AGREEMENT
DATED AS OF January 24, 2002
AMONG
WASHINGTON GROUP INTERNATIONAL, INC.
AS A GRANTOR
AND
EACH OTHER GRANTOR
FROM TIME TO TIME PARTY HERETO
AND
CREDIT SUISSE FIRST BOSTON
AS ADMINISTRATIVE AGENT
WEIL, GOTSHAL & XXXXXX LLP
000 XXXXX XXXXXX
XXX XXXX, XXX XXXX 00000-0000
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINED TERMS........................................................................1
Section 1.1 Definitions..................................................................1
Section 1.2 Certain Other Terms..........................................................5
ARTICLE II GRANT OF A SECURITY INTEREST.........................................................6
Section 2.1 Collateral...................................................................6
Section 2.2 Grant of Security Interest in Collateral.....................................7
Section 2.3 Cash Collateral Accounts.....................................................7
ARTICLE III REPRESENTATIONS AND WARRANTIES.......................................................8
Section 3.1 Title; No Other Liens........................................................8
Section 3.2 Perfection and Priority......................................................8
Section 3.3 Name; Jurisdiction of Organization; Chief Executive Office...................8
Section 3.4 Inventory and Equipment......................................................8
Section 3.5 Pledged Collateral...........................................................9
Section 3.6 Accounts.....................................................................9
Section 3.7 Intellectual Property........................................................9
Section 3.8 Deposit Accounts; Control Accounts..........................................10
Section 3.9 Government Contracts........................................................10
ARTICLE IV COVENANTS...........................................................................10
Section 4.1 Generally...................................................................10
Section 4.2 Maintenance of Perfected Security Interest; Further Documentation...........11
Section 4.3 Changes in Locations, Name, Etc.............................................11
Section 4.4 Pledged Collateral..........................................................11
Section 4.5 Control Accounts; Approved Deposit Accounts.................................13
Section 4.6 Accounts....................................................................13
Section 4.7 Delivery of Instruments and Chattel Paper...................................14
Section 4.8 Intellectual Property.......................................................14
Section 4.9 Vehicles....................................................................15
Section 4.10 Payment of Obligations......................................................16
Section 4.11 Assignable Government Contracts.............................................16
Section 4.12 Representations and Warranties; Covenants...................................17
ARTICLE V REMEDIAL PROVISIONS.................................................................17
Section 5.1 Code and Other Remedies.....................................................17
Section 5.2 Accounts and Payments in Respect of General Intangibles.....................18
Section 5.3 Pledged Collateral..........................................................19
Section 5.4 Proceeds to be Turned Over To Administrative Agent..........................20
Section 5.5 Registration Rights.........................................................20
Section 5.6 Deficiency..................................................................21
ARTICLE VI THE ADMINISTRATIVE AGENT............................................................21
Section 6.1 Administrative Agent's Appointment as Attorney-in-Fact......................21
Section 6.2 Duty of Administrative Agent................................................23
Section 6.3 Execution of Financing Statements...........................................23
Section 6.4 Authority of Administrative Agent...........................................24
ARTICLE VII MISCELLANEOUS.......................................................................24
Section 7.1 Amendments in Writing.......................................................24
Section 7.2 Notices.....................................................................24
Section 7.3 No Waiver by Course of Conduct; Cumulative Remedies.........................24
Section 7.4 Successors and Assigns......................................................24
Section 7.5 Counterparts................................................................25
Section 7.6 Severability................................................................25
Section 7.7 Section Headings............................................................25
Section 7.8 Entire Agreement............................................................25
Section 7.9 Governing Law...............................................................25
Section 7.10 Additional Grantors.........................................................25
Section 7.11 Release of Collateral.......................................................26
Section 7.12 Reinstatement...............................................................26
ANNEXES AND SCHEDULES(1)
Annex 1 Form of Deposit Account Control Agreement
Annex 2 Form of Control Account Agreement
Annex 3 Form of Pledge Amendment
Annex 4 Form of Joinder Agreement
Annex 5 Form of Short Form Copyright Security Agreement
Annex 6 Form of Short Form Patent Security Agreement
Annex 7 Form of Short Form Trademark Security Agreement
Annex 8 Form of Notice of Assignment of Government
Contract
Annex 9 Form of Assignment of Government Contract
Schedule 1 State of Incorporation; Principal Executive
Office
Schedule 2 Pledged Collateral
Schedule 3 Filings
Schedule 4 Location of Inventory and Equipment
Schedule 5 Intellectual Property
Schedule 6 Bank Accounts; Control Accounts
Schedule 7 Government Contracts
----------------------
(1) If you are using automatic cross-references, modify numbering and title of
the annexes and schedules on this page only.
PLEDGE AND SECURITY AGREEMENT, dated as of January 24, 2002, by
WASHINGTON GROUP INTERNATIONAL, INC. (the "BORROWER") and each of the other
entities listed on the signature pages hereof or that becomes a party hereto
pursuant to SECTION 7.10 (ADDITIONAL GRANTORS) (each a "GRANTOR" and,
collectively, the "GRANTORS"), in favor of Credit Suisse First Boston ("CSFB"),
as agent for the Secured Parties (as defined in the Credit Agreement referred to
below) (in such capacity, the "ADMINISTRATIVE AGENT").
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, dated as of January 24,
2002 (as the same may be amended, restated, supplemented or otherwise modified
from time to time, the "CREDIT AGREEMENT"), among the Borrower, the Lenders and
Issuers party thereto and CSFB, as agent for the Lenders and Issuers, the
Lenders and the Issuers have severally agreed to make extensions of credit to
the Borrower upon the terms and subject to the conditions set forth therein;
WHEREAS, the Grantors other than the Borrower are party to the
Guaranty pursuant to which they have guaranteed the Obligations; and
WHEREAS, a condition precedent to the obligation of the Lenders and
the Issuers to make their respective extensions of credit to the Borrower under
the Credit Agreement is that the Grantors shall have executed and delivered this
Agreement to the Administrative Agent;
NOW, THEREFORE, in consideration of the premises and to induce the
Lenders, the Issuers and the Administrative Agent to enter into the Credit
Agreement and to induce the Lenders and the Issuers to make their respective
extensions of credit to the Borrower thereunder, each Grantor hereby agrees with
the Administrative Agent as follows:
ARTICLE I DEFINED TERMS
SECTION 1.1 DEFINITIONS
(a) Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein have the meanings given to them in the Credit
Agreement.
(b) Terms used herein that are defined in the UCC have the meanings
given to them in the UCC, including the following terms (which are capitalized
herein):
"ACCOUNT DEBTOR"
"ACCOUNTS"
"CHATTEL PAPER"
"COMMODITY ACCOUNT"
"COMMODITY INTERMEDIARY"
"DEPOSIT ACCOUNT"
"DOCUMENTS"
"ENTITLEMENT HOLDER"
"ENTITLEMENT ORDER"
"EQUIPMENT"
"FINANCIAL ASSET"
"GENERAL INTANGIBLES"
"INSTRUMENTS"
"INVENTORY"
"INVESTMENT PROPERTY"
"LETTER OF CREDIT RIGHT"
"PROCEEDS"
"SECURITIES ACCOUNT"
"SECURITIES INTERMEDIARY"
"SECURITY"
"SECURITY ENTITLEMENT"
(c) The following terms shall have the following meanings:
"ADDITIONAL PLEDGED COLLATERAL" means all shares of, limited or
general partnership interests in, and limited liability company interests in,
and all securities convertible into, and warrants, options and other rights to
purchase or otherwise acquire, stock of, either (i) any Person that, after the
date of this Agreement, as a result of any occurrence, becomes a direct
Subsidiary of any Grantor or (ii) any issuer of Pledged Stock, any Partnership
or any LLC that are acquired by any Grantor after the date hereof (PROVIDED,
HOWEVER, that "ADDITIONAL PLEDGED COLLATERAL" shall in no event include 65% of
the outstanding Stock of any Subsidiary of a Grantor that is not a Domestic
Subsidiary); all certificates or other instruments representing any of the
foregoing; all Security Entitlements of any Grantor in respect of any of the
foregoing; all additional indebtedness from time to time owed to any Grantor by
any obligor on the Pledged Notes and the instruments evidencing such
indebtedness; and all interest, cash, instruments and other property or Proceeds
from time to time received, receivable or otherwise distributed in respect of or
in exchange for any of the foregoing. Additional Pledged Collateral may be
General Intangibles or Investment Property.
"AGREEMENT" means this
Pledge and Security Agreement.
"APPROVED DEPOSIT ACCOUNT" means a Deposit Account subject to an
effective Deposit Account Control Agreement and maintained by any Grantor with a
Deposit Account Bank. "APPROVED DEPOSIT ACCOUNT" includes all monies on deposit
in such Deposit Account and all certificates and instruments, if any,
representing or evidencing such Deposit Account.
"APPROVED SECURITIES INTERMEDIARY" means a Securities Intermediary
or Commodity Intermediary selected or approved by the Administrative Agent and
with respect to which a Grantor has delivered to the Administrative Agent an
executed Control Account Agreement.
"ASSIGNABLE GOVERNMENT CONTRACT" means an effective Government
Contract that (a) the Grantor party thereto has the present right to assign to a
third party (other than a Subsidiary of the Borrower) pursuant to the terms
thereof, (b) pursuant to the terms of such Government Contract, can then be
reassigned by such assignee to another third party and (c) together with the
assignment thereof, meets all applicable requirements for assignments under the
Assignment of Claims Act.
"ASSIGNMENT OF GOVERNMENT CONTRACT" means an assignment,
substantially in the form of ANNEX 9 (FORM OF ASSIGNMENT OF GOVERNMENT CONTRACT)
(with such changes as may be agreed to by the Administrative Agent) and executed
by the Grantor.
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"CASH COLLATERAL ACCOUNT" means any Deposit Account or Securities
Account established by the Administrative Agent as provided in SECTION 2.3 (CASH
COLLATERAL ACCOUNTS) in which cash and Cash Equivalents may from time to time be
on deposit or held therein as provided in SECTION 5.2 (ACCOUNTS AND PAYMENTS IN
RESPECT OF GENERAL INTANGIBLES) or 5.4 (PROCEEDS TO BE TURNED OVER TO
ADMINISTRATIVE AGENT) or the Credit Agreement.
"COLLATERAL" has the meaning specified in SECTION 2.1 (COLLATERAL).
"CONTROL ACCOUNT" means a Securities Account or Commodity Account
subject of an effective Control Account Agreement and maintained by any Grantor
with an Approved Securities Intermediary. "CONTROL ACCOUNT" includes all
Financial Assets held in such Securities Account or Commodity Account and all
certificates and instruments, if any, representing or evidencing the Financial
Assets contained therein.
"CONTROL ACCOUNT AGREEMENT" means a letter agreement, substantially
in the form of ANNEX 2 (FORM OF CONTROL ACCOUNT AGREEMENT) (with such changes as
may be agreed to by the Administrative Agent), executed by the relevant Grantor,
the Administrative Agent and the relevant Approved Securities Intermediary.
"COPYRIGHT LICENSES" means any written agreement naming any Grantor
as licensor or licensee granting any right under any Copyright, including the
grant of any right to copy, publicly perform, create derivative works,
manufacture, distribute, exploit or sell materials derived from any Copyright.
"COPYRIGHTS" means (a) all copyrights arising under the laws of the
United States, any other country or any political subdivision thereof, whether
registered or unregistered and whether published or unpublished, all
registrations and recordings thereof and all applications in connection
therewith, including all registrations, recordings and applications in the
United States Copyright Office or in any foreign counterparts thereof, and (b)
the right to obtain all renewals thereof.
"DEPOSIT ACCOUNT BANK" means a financial institution selected or
approved by the Administrative Agent and with respect to which a Grantor has
delivered to the Administrative Agent an executed Deposit Account Control
Agreement.
"DEPOSIT ACCOUNT CONTROL AGREEMENT" means a letter agreement,
substantially in the form of ANNEX 1 (FORM OF DEPOSIT ACCOUNT CONTROL AGREEMENT)
(with such changes as may be agreed to by the Administrative Agent) and executed
by the Grantor, the Administrative Agent and the relevant Deposit Account Bank.
"FOREIGN INVENTORY AND EQUIPMENT" means Inventory and Equipment
located outside of the fifty states of the United States of America, other than
Inventory and Equipment in transit and other than mobile goods.
"GOVERNMENT CONTRACT" means all written Contractual Obligations
between any Loan Party and any federal Governmental Authority of the United
States of America.
"INTELLECTUAL PROPERTY" means, collectively, all rights, priorities
and privileges of any Grantor relating to intellectual property, whether arising
under United States, multinational or foreign laws or otherwise, including
Copyrights, Copyright Licenses, Patents, Patent Licenses,
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Trademarks, Trademark Licenses and trade secrets, and all rights to xxx at
law or in equity for any infringement or other impairment thereof, including
the right to receive all proceeds and damages therefrom.
"INTERCOMPANY NOTE" means any promissory note evidencing loans made
by any Grantor to any of its Subsidiaries or another Grantor.
"LLC" means each limited liability company in which a Grantor has an
interest, including those set forth on SCHEDULE 2 (PLEDGED COLLATERAL).
"LLC AGREEMENT" means each operating agreement with respect to an
LLC, as each agreement has heretofore been, and may hereafter be, amended,
restated, supplemented or otherwise modified from time to time.
"MATERIAL INTELLECTUAL PROPERTY" means Intellectual Property owned
by or licensed to a Grantor and material to such Grantor's business.
"NOTICE OF ASSIGNMENT OF GOVERNMENT CONTRACT" means a notice of
assignment, substantially in the form of ANNEX 8 (FORM OF NOTICE OF ASSIGNMENT
OF GOVERNMENT CONTRACT) (with such changes as may be agreed to by the
Administrative Agent) prepared by the Grantor and executed by the Administrative
Agent.
"PARTNERSHIP" means each partnership in which a Grantor has an
interest, including those set forth on SCHEDULE 2 (PLEDGED COLLATERAL).
"PARTNERSHIP AGREEMENT" means each partnership agreement governing a
Partnership, as each such agreement has heretofore been, and may hereafter be,
amended, restated, supplemented or otherwise modified.
"PATENTS" means (a) all letters patent of the United States, any
other country or any political subdivision thereof and all reissues and
extensions thereof, (b) all applications for letters patent of the United States
or any other country and all divisions, continuations and continuations-in-part
thereof and (c) all rights to obtain any reissues or extensions of the
foregoing.
"PATENT LICENSE" means all agreements, whether written or oral,
providing for the grant by or to any Grantor of any right to manufacture, use,
import, sell or offer for sale any invention covered in whole or in part by a
Patent.
"PLEDGED COLLATERAL" means, collectively, the Pledged Notes, the
Pledged Stock, the Pledged Partnership Interests, the Pledged LLC Interests, any
other Investment Property of any Grantor in excess of $1,000,000, all
certificates or other instruments representing any of the foregoing and all
Security Entitlements of any Grantor in respect of any of the foregoing. Pledged
Collateral may be General Intangibles or Investment Property.
"PLEDGED LLC INTERESTS" means all right, title and interest of any
Grantor as a member of any LLC and all right, title and interest of any Grantor
in, to and under any LLC Agreement to which it is a party; PROVIDED, HOWEVER,
that in no event shall "PLEDGED LLC INTEREST" include more than 65% of the
outstanding Stock of any Subsidiary of any Grantor that is not a Domestic
Subsidiary.
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"PLEDGED NOTES" means all right, title and interest of any Grantor
in the Instruments evidencing all Indebtedness owed to such Grantor, issued by
the obligors named therein.
"PLEDGED PARTNERSHIP INTERESTS" means all right, title and interest
of any Grantor as a limited or general partner in all Partnerships and all
right, title and interest of any Grantor in, to and under any Partnership
Agreements to which it is a party; PROVIDED, HOWEVER, that in no event shall
"PLEDGED PARTNERSHIP INTERESTS" included more than 65% of the outstanding Stock
of any Subsidiary of any Grantor that is not a Domestic Subsidiary.
"PLEDGED STOCK" means the shares of capital stock owned by each
Grantor, including all shares of capital stock listed on SCHEDULE 2 (PLEDGED
COLLATERAL); PROVIDED, HOWEVER, that in no event shall the Borrower or any
Grantor be required to pledge in excess of 65% of the outstanding Stock of any
Subsidiary that is not a Domestic Subsidiary or any of the stock of any
Subsidiary of such Subsidiary.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SURETY COLLATERAL" means Collateral in which the Surety has been
granted a valid, first priority security interest in accordance with the Surety
Facility.
"TRADEMARK LICENSE" means any agreement, whether written or oral,
providing for the grant by or to any Grantor of any right to use any Trademark.
"TRADEMARKS" means (a) all trademarks, trade names, corporate names,
company names, business names, fictitious business names, trade styles, service
marks, logos and other source or business identifiers, and, in each case, all
goodwill associated therewith, whether now existing or hereafter adopted or
acquired, all registrations and recordings thereof and all applications in
connection therewith, in each case whether in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
State thereof or any other country or any political subdivision thereof, or
otherwise, and all common-law rights related thereto, and (b) the right to
obtain all renewals thereof.
"UCC" means the Uniform Commercial Code as from time to time in
effect in the State of
New York; PROVIDED, HOWEVER, that, in the event that, by
reason of mandatory provisions of law, any of the attachment, perfection or
priority of the Administrative Agent's and the Secured Parties' security
interest in any Collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than the State of
New York, the term "UCC" shall
mean the Uniform Commercial Code as in effect in such other jurisdiction for
purposes of the provisions hereof relating to such attachment, perfection or
priority and for purposes of definitions related to such provisions.
"VEHICLES" means all vehicles covered by a certificate of title law
of any state.
SECTION 1.2 CERTAIN OTHER TERMS
(a) In this Agreement, in the computation of periods of time from a
specified date to a later specified date, the word "FROM" means "from and
including" and the words "TO" and "UNTIL" each mean "to but excluding" and the
word "THROUGH" means "to and including."
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(b) The terms "HEREIN," "HEREOF," "HERETO" and "HEREUNDER" and
similar terms refer to this Agreement as a whole and not to any particular
Article, Section, subsection or clause in this Agreement.
(c) References herein to an Annex, Schedule, Article, Section,
subsection or clause refer to the appropriate Annex or Schedule to, or Article,
Section, subsection or clause in this Agreement.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(e) Where the context requires, provisions relating to any
Collateral, when used in relation to a Grantor, shall refer to such Grantor's
Collateral or any relevant part thereof.
(f) Any reference in this Agreement to a Loan Document shall include
all appendices, exhibits and schedules thereto, and, unless specifically stated
otherwise all amendments, restatements, supplements or other modifications
thereto, and as the same may be in effect at any time such reference becomes
operative.
(g) The term "INCLUDING" means "INCLUDING WITHOUT LIMITATION" except
when used in the computation of time periods.
(h) The terms "LENDER," "ISSUER," "ADMINISTRATIVE AGENT" and
"SECURED PARTY" include their respective successors.
(i) References in this Agreement to any statute shall be to such
statute as amended or modified and in effect from time to time.
ARTICLE II GRANT OF A SECURITY INTEREST
SECTION 2.1 COLLATERAL
For the purposes of this Agreement, all of the following property
now owned or at any time hereafter acquired by a Grantor or in which a Grantor
now has or at any time in the future may acquire any right, title or interests
is collectively referred to as the "COLLATERAL":
(a) all Accounts;
(b) all Chattel Paper;
(c) all Deposit Accounts;
(d) all Documents;
(e) all Equipment;
(f) all General Intangibles;
(g) all Instruments;
(h) all Inventory;
(i) all Investment Property;
(j) all Letter of Credit Rights;
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(k) all Vehicles;
(l) all books and records pertaining to the other property
described in this SECTION 2.1;
(m) all other goods and personal property of such Grantor,
whether tangible or intangible and wherever located;
(n) all property of any Grantor held by the Administrative Agent or
any other Secured Party, including all property of every description, in the
possession or custody of or in transit to the Administrative Agent or such
Secured Party for any purpose, including safekeeping, collection or pledge, for
the account of such Grantor or as to which such Grantor may have any right or
power; and
(o) to the extent not otherwise included, all Proceeds.
SECTION 2.2 GRANT OF SECURITY INTEREST IN COLLATERAL
Each Grantor, as collateral security for the full, prompt and
complete payment and performance when due (whether at stated maturity, by
acceleration or otherwise) of the Secured Obligations of such Grantor, hereby
collaterally assigns, mortgages, pledges and hypothecates to the Administrative
Agent for the benefit of the Secured Parties, and grants to the Administrative
Agent for the benefit of the Secured Parties a lien on and security interest in,
all of its right, title and interest in, to and under the Collateral of such
Grantor.
SECTION 2.3 CASH COLLATERAL ACCOUNTS
The Administrative Agent has established a Deposit Account at Bank
of
New York, designated as "CSFB/Washington Group Loan Account". The
Administrative Agent may establish one or more other Deposit Accounts and one or
more Securities Accounts with such depositaries and Securities Intermediaries as
it in its sole discretion shall determine. Each such account shall be for the
benefit of the Administrative Agent (but may also have words referring to the
Borrower and the account's purpose). The Borrower agrees that each such account
shall be under the sole dominion and control of the Administrative Agent. The
Administrative Agent shall be the Entitlement Holder with respect to each such
Securities Account and the only Person authorized to give Entitlement Orders
with respect thereto. Without limiting the foregoing, funds on deposit in any
Cash Collateral Account may be invested in Cash Equivalents at the direction of
the Administrative Agent and, except during the continuance of an Event of
Default, the Administrative Agent agrees with the Borrower to issue Entitlement
Orders for such investments in Cash Equivalents as requested by the Borrower;
PROVIDED, HOWEVER, that the Administrative Agent shall not have any
responsibility for, or bear any risk of loss of, any such investment or income
thereon. Neither the Borrower nor any other Loan Party or Person claiming on
behalf of or through the Borrower or any other Loan Party shall have any right
to demand payment of any funds held in any Cash Collateral Account at any time
prior to the termination of all outstanding Letters of Credit and the payment in
full of all then outstanding and payable monetary Obligations. The
Administrative Agent shall apply all funds on deposit in a Cash Collateral
Account as provided in the Credit Agreement and except during the continuance of
an Event of Default agrees to cause any funds remaining on deposit therein after
all Obligations then due and payable have been satisfied and all Letter of
Credit Obligations have been cash collateralized at 105% to be paid at the
written direction of the Borrower.
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ARTICLE III REPRESENTATIONS AND WARRANTIES
To induce the Lenders, the Issuers and the Administrative Agent to
enter into the Credit Agreement, each Grantor hereby represents and warrants
each of the following to the Administrative Agent, the Lenders, the Issuers and
the other Secured Parties:
SECTION 3.1 TITLE; NO OTHER LIENS
Except for the Lien granted to the Administrative Agent pursuant to
this Agreement and the other Liens permitted to exist on the Collateral under
the Credit Agreement, such Grantor is the record and beneficial owner of the
Pledged Collateral pledged by it hereunder constituting Instruments or
certificated securities, is the Entitlement Holder of all such Pledged
Collateral constituting Investment Property held in a Securities Account and has
rights in or the power to transfer each other item of Collateral in which a Lien
is granted by it hereunder, free and clear of any Lien.
SECTION 3.2 PERFECTION AND PRIORITY
The security interest granted pursuant to this Agreement shall
constitute a valid and continuing perfected security interest in favor of the
Administrative Agent in the Collateral for which perfection is governed by the
UCC or filing with the United States Copyright Office upon (i) the completion of
the filings and other actions specified on SCHEDULE 3 (FILINGS) (which, in the
case of all filings and other documents referred to on such schedule, have been
delivered to the Administrative Agent in completed and duly executed form), (ii)
the delivery to the Administrative Agent of all Collateral consisting of
Instruments and certificated securities, in each case properly endorsed for
transfer to the Administrative Agent or in blank, (iii) the execution of Control
Account Agreements with respect to Investment Property not in certificated form
and (iv) the execution of Deposit Account Control Agreements with respect to all
Deposit Accounts (other than the Cash Collateral Account). Such security
interest shall be prior to all other Liens on the Collateral except for
Customary Permitted Liens having priority over the Administrative Agent's Lien
by operation of law or otherwise as permitted under the Credit Agreement.
SECTION 3.3 NAME; JURISDICTION OF ORGANIZATION; CHIEF EXECUTIVE
OFFICE
(a) Except as set forth on SCHEDULE 1 (STATE OF INCORPORATION;
PRINCIPAL EXECUTIVE OFFICE), within the five-year period preceding the date
hereof such Grantor has not had, or operated in any jurisdiction, under any
trade name, fictitious name or other name other than its legal name.
(b) On the date hereof such Grantor's jurisdiction of organization,
organizational identification number, if any, and the location of such Grantor's
chief executive office or sole place of business is specified on SCHEDULE 1
(STATE OF INCORPORATION; PRINCIPAL EXECUTIVE OFFICE).
SECTION 3.4 INVENTORY AND EQUIPMENT
SCHEDULE 4 (LOCATION OF INVENTORY AND EQUIPMENT) sets forth
separately the aggregate net book value of (i) all Foreign Inventory and
Equipment of each Grantor and (ii) all Inventory and Equipment of a Grantor
that, on the Closing Date, is not in the possession of any Grantor, including
Inventory or Equipment in the possession of a bailee or consignee.
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SECTION 3.5 PLEDGED COLLATERAL
(a) The Pledged Stock, Pledged Partnership Interests and Pledged LLC
Interests pledged hereunder by such Grantor are listed on SCHEDULE 2 (PLEDGED
COLLATERAL) and constitute that percentage of the issued and outstanding equity
of all classes of each issuer thereof as set forth on SCHEDULE 2 (PLEDGED
COLLATERAL).
(b) All of the Pledged Stock, Pledged Partnership Interests and
Pledged LLC Interests have been duly and validly issued and are fully paid and
nonassessable.
(c) Each of the Pledged Notes constitutes the legal, valid and
binding obligation of the obligor with respect thereto, enforceable in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, and general equitable
principles (whether considered in a proceeding in equity or at law).
(d) All Pledged Collateral and, if applicable, any Additional
Pledged Collateral, consisting of certificated securities or Instruments has
been delivered to the Administrative Agent in accordance with SECTION 4.4(a)
(PLEDGED COLLATERAL).
(e) All Pledged Collateral held by a Securities Intermediary in a
Securities Account is in a Control Account.
(f) Other than the Pledged Partnership Interests and the Pledged LLC
Interests that constitute General Intangibles, there is no Pledged Collateral
other than that represented by certificated securities or Instruments in the
possession of the Administrative Agent or that consisting of Financial Assets
held in a Control Account.
SECTION 3.6 ACCOUNTS
No amount payable to such Grantor under or in connection with any
Account is evidenced by any Instrument or Chattel Paper that has not been
delivered to the Administrative Agent, properly endorsed for transfer, to the
extent delivery is required by SECTION 4.4 (PLEDGED COLLATERAL).
SECTION 3.7 INTELLECTUAL PROPERTY
(a) SCHEDULE 5 (INTELLECTUAL PROPERTY) lists all Material
Intellectual Property of such Grantor on the date hereof, separately identifying
that owned by such Grantor and that licensed to such Grantor. The Material
Intellectual Property set forth on SCHEDULE 5 (INTELLECTUAL PROPERTY) for such
Grantor constitutes all of the intellectual property rights necessary to conduct
its business.
(b) On the date hereof, all Material Intellectual Property owned by
such Grantor is valid, subsisting, unexpired and enforceable, has not been
adjudged invalid and has not been abandoned and the use thereof in the business
of such Grantor does not infringe the intellectual property rights of any other
Person.
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(c) Except as set forth in SCHEDULE 5 (INTELLECTUAL PROPERTY), on
the date hereof, none of the Material Intellectual Property owned by such
Grantor is the subject of any licensing or franchise agreement pursuant to which
such Grantor is the licensor or franchisor.
(d) No holding, decision or judgment has been rendered by any
Governmental Authority that would limit, cancel or question the validity of, or
such Grantor's rights in, any Material Intellectual Property.
(e) No action or proceeding seeking to limit, cancel or question the
validity of any Material Intellectual Property owned by such Grantor or such
Grantor's ownership interest therein is on the date hereof pending or, to the
knowledge of such Grantor, threatened. There are no claims, judgments or
settlements to be paid by such Grantor relating to the Material Intellectual
Property.
SECTION 3.8 DEPOSIT ACCOUNTS; CONTROL ACCOUNTS
The only Deposit Accounts or Securities Accounts maintained by any
Grantor on the date hereof are those listed on SCHEDULE 6 (BANK ACCOUNTS;
CONTROL ACCOUNTS), which sets forth such information separately for each
Grantor.
SECTION 3.9 GOVERNMENT CONTRACTS
The only Government Contracts to which the Borrower or any
Subsidiary is party that as of the date hereof have a value in excess of
$5,000,000 are listed on SCHEDULE 7 (GOVERNMENT CONTRACTS), and all
documentation necessary for compliance with the Assignment of Claims Act has
been executed and delivered by the Borrower and each Subsidiary, as applicable,
to the Administrative Agent with respect to each Government Contract.
ARTICLE IV COVENANTS
Each Grantor agrees with the Administrative Agent to the following,
as long as any Obligation or Commitment remains outstanding and unless the
Requisite Lenders otherwise consent in writing:
SECTION 4.1 GENERALLY
Such Grantor shall (a) except for the security interest created by
this Agreement, not create or suffer to exist any Lien upon or with respect to
any Collateral, except Liens permitted under SECTION 8.2 (LIENS, ETC.) of the
Credit Agreement, (b) not use or permit any Collateral to be used unlawfully or
in violation of any provision of this Agreement, any other Loan Document, any
Requirement of Law or any policy of insurance covering the Collateral, (c) not
sell, transfer or assign (by operation of law or otherwise) any Collateral
except as permitted under the Credit Agreement, (d) not enter into any agreement
or undertaking that lawfully restricts the right or ability of such Grantor or
the Administrative Agent to sell, assign or transfer any Collateral if such
restriction would have a Material Adverse Effect and (e) promptly notify the
Administrative Agent of its entry into any agreement or assumption of
undertaking that lawfully restricts the ability to sell, assign or transfer any
Collateral regardless of whether or not it has a Material Adverse Effect.
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SECTION 4.2 MAINTENANCE OF PERFECTED SECURITY INTEREST; FURTHER
DOCUMENTATION
Such Grantor shall maintain the security interest created by this
Agreement as a perfected security interest having at least the priority
described in SECTION 3.2 (PERFECTION AND PRIORITY) and shall defend such
security interest against the claims and demands of all Persons.
SECTION 4.3 CHANGES IN LOCATIONS, NAME, ETC.
(a) Except upon 15 days' prior written notice to the Administrative
Agent and delivery to the Administrative Agent of all additional executed
financing statements and other documents reasonably requested by the
Administrative Agent to maintain the validity, perfection and priority of the
security interests provided for herein, such Grantor shall not do any of the
following:
(i) change its jurisdiction of organization or the location of its
chief executive office or sole place of business from that referred to in
SECTION 3.3 (NAME; JURISDICTION OF ORGANIZATION; CHIEF EXECUTIVE OFFICE);
or
(ii) change its name, identity or corporate structure to such an
extent that any financing statement filed in connection with this
Agreement would become misleading.
(b) Promptly after request by the Administrative Agent (and in no
event later than 15 Business Days after receipt thereof), each Grantor shall
provide to the Administrative Agent a list, in form and substance reasonably
satisfactory to the Administrative Agent and certified by a Responsible Officer
of such Grantor as true, correct and complete, of all locations of Inventory and
Equipment, other than Inventory and Equipment in transit and other than mobile
goods.
(c) Such Grantor shall keep and maintain at its own cost and expense
satisfactory and complete records of the Collateral, including a record of all
payments received and all credits granted with respect to the Collateral and all
other dealings with the Collateral. If requested by the Administrative Agent,
the security interest of the Administrative Agent shall be noted on the
certificate of title of each Vehicle.
SECTION 4.4 PLEDGED COLLATERAL
(a) Subject to SECTION 4.4(d), such Grantor shall (i) deliver to the
Administrative Agent, all certificates and Instruments representing or
evidencing any Pledged Collateral (including Additional Pledged Collateral),
and, at the Collateral Agent's reasonable request, all Instruments, whether now
existing or hereafter acquired, in suitable form for transfer by delivery or, as
applicable, accompanied by such Grantor's endorsement, where necessary, or duly
executed instruments of transfer or assignment in blank, all in form and
substance satisfactory to the Administrative Agent, together, in respect of any
Additional Pledged Collateral, with a Pledge Amendment, duly executed by the
Grantor, in substantially the form of ANNEX 3 (FORM OF PLEDGE AMENDMENT) or such
other documentation acceptable to the Administrative Agent and (ii) maintain all
other Pledged Collateral constituting Investment Property in a Control Account.
Such Grantor authorizes the Administrative Agent to attach each Pledge Amendment
to this Agreement. The Administrative Agent shall have the right, at any time in
its discretion and without notice to the Grantor, to transfer to or to register
in its name or
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in the name of its nominees any Pledged Collateral. The Administrative Agent
shall have the right at any time to exchange any certificate or instrument
representing or evidencing any Pledged Collateral for certificates or
instruments of smaller or larger denominations.
(b) Except as provided in ARTICLE V (REMEDIAL PROVISIONS), such
Grantor shall be entitled to receive all cash dividends paid in respect of the
Pledged Collateral (other than liquidating or distributing dividends) with
respect to the Pledged Collateral. Any sums paid upon or in respect of any
Pledged Collateral upon the liquidation or dissolution of any issuer of any
Pledged Collateral, any distribution of capital made on or in respect of any
Pledged Collateral or any property distributed upon or with respect to any
Pledged Collateral pursuant to the recapitalization or reclassification of the
capital of any issuer of Pledged Collateral or pursuant to the reorganization
thereof shall, unless otherwise subject to a perfected security interest in
favor of the Administrative Agent, be delivered to the Administrative Agent to
be held by it hereunder as additional collateral security for the Secured
Obligations. If any sum of money or property so paid or distributed in respect
of any Pledged Collateral shall be received by such Grantor, such Grantor shall,
until such money or property is paid or delivered to the Administrative Agent,
hold such money or property in trust for the Administrative Agent, segregated
from other funds of such Grantor, as additional security for the Secured
Obligations.
(c) Except as provided in ARTICLE V (REMEDIAL PROVISIONS), such
Grantor shall be entitled to exercise all voting, consent and corporate rights
with respect to the Pledged Collateral; PROVIDED, HOWEVER, that no vote shall be
cast, consent given or right exercised or other action taken by such Grantor
that would impair the Collateral, be inconsistent with or result in any
violation of any provision of the Credit Agreement, this Agreement or any other
Loan Document or, without prior notice to the Administrative Agent, enable or
permit any issuer of Pledged Collateral to issue any stock or other equity
securities of any nature or to issue any other securities convertible into or
granting the right to purchase or exchange for any stock or other equity
securities of any nature of any issuer of Pledged Collateral.
(d) Such Grantor shall not grant control over any Investment
Property to any Person other than the Administrative Agent, other than, as long
as the Surety shall have a first-priority security interest therein in
accordance with the Surety Facility and the Surety Intercreditor Agreement, the
Surety Collateral.
(e) In the case of each Grantor that is an issuer of Pledged
Collateral, such Grantor agrees to be bound by the terms of this Agreement
relating to the Pledged Collateral issued by it and shall comply with such terms
insofar as such terms are applicable to it. In the case of each Grantor that is
a partner in a Partnership, such Grantor hereby consents to the extent required
by the applicable Partnership Agreement to the pledge by each other Grantor,
pursuant to the terms hereof, of the Pledged Partnership Interests in such
Partnership and to the transfer of such Pledged Partnership Interests to the
Administrative Agent or its nominee and to the substitution of the
Administrative Agent or its nominee as a substituted partner in such Partnership
with all the rights, powers and duties of a general partner or a limited
partner, as the case may be. In the case of each Grantor member of an LLC, such
Grantor hereby consents to the extent required by the applicable LLC Agreement
to the pledge by each other Grantor, pursuant to the terms hereof, of the
Pledged LLC Interests in such LLC and to the transfer of such Pledged LLC
Interests to the Administrative Agent or its nominee and to the substitution of
the Administrative Agent or its nominee as a substituted member of the LLC with
all the rights, powers and duties of a member of the LLC in question.
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(f) Such Grantor shall not agree to any amendment of an LLC
Agreement or Partnership Agreement that in any way adversely affects the
perfection of the security interest of the Administrative Agent in the Pledged
Partnership Interests or Pledged LLC Interests pledged by such Grantor
hereunder, including any amendment electing to treat the membership interest or
partnership interest of such Grantor as a security under Section 8-103 of the
UCC.
SECTION 4.5 CONTROL ACCOUNTS; APPROVED DEPOSIT ACCOUNTS
(a) Such Grantor shall (i) transfer every Business Day to an
Approved Deposit Account all cash received by such Grantor (except, as long as
the Surety shall have a first-priority security interest therein under the
Surety Facility and the Surety Intercreditor Agreement, the Surety Collateral),
(ii) not establish or maintain any Securities Account that is not a Control
Account (except, so long as such Securities Account shall be permitted under the
Surety Facility, in connection with the Surety Facility and in accordance with
the Surety Intercreditor Agreement) and (iii) not establish or maintain any
Deposit Account other than Approved Deposit Accounts and those of a Lender or an
Affiliate and Deposit Accounts whose entire balances are transferred daily to an
Approved Deposit Account in accordance with CLAUSE (i) above; PROVIDED, HOWEVER,
that any Grantor may maintain (x) payroll, withholding tax and other fiduciary
accounts and (y) other accounts so long as the aggregate balance in all such
accounts does not exceed $30,000,000.
(b) In the event (i) such Grantor or any Approved Securities
Intermediary or Deposit Account Bank shall, after the date hereof, terminate an
agreement with respect to the maintenance of a Control Account or Approved
Deposit Account for any reason or (ii) the Administrative Agent shall demand
such termination as a result of the failure of an Approved Securities
Intermediary or Deposit Account Bank to comply with the terms of the applicable
Control Account Agreement or Deposit Account Control Agreement, such Grantor
agrees to notify all of its obligors that were making payments to such
terminated Control Account or Approved Deposit Account, as the case may be, to
make all future payments to another Control Account or Approved Deposit Account,
as the case may be.
SECTION 4.6 ACCOUNTS
(a) Such Grantor shall not, other than in the ordinary course of
business consistent with its past practice, (i) grant any extension of the time
of payment of any Account, (ii) compromise or settle any Account for less than
the full amount thereof, (iii) release, wholly or partially, any Person liable
for the payment of any Account, (iv) allow any credit or discount on any Account
or (v) amend, supplement or modify any Account in any manner that could
materially adversely affect the value thereof.
(b) The Administrative Agent shall have the right to make test
verifications of the Accounts in any manner and through any medium that it
reasonably considers advisable, and such Grantor shall furnish all such
reasonable assistance and information as the Administrative Agent may reasonably
require in connection therewith. At any time and from time to time, upon the
Administrative Agent's request and at the expense of the relevant Grantor, such
Grantor shall cause independent public accountants or others satisfactory to the
Administrative Agent to furnish to the Administrative Agent reports showing
reconciliations, aging and test verifications of, and trial balances for, the
Accounts; PROVIDED, HOWEVER, that unless a Default or Event of Default shall be
continuing, the Administrative Agent shall request no more than four such
reports during any calendar year.
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SECTION 4.7 DELIVERY OF INSTRUMENTS AND CHATTEL PAPER
If any amount in excess of $1,000,000 payable under or in connection
with any Collateral owned by such Grantor shall be or become evidenced by an
Instrument or Chattel Paper, such Grantor shall immediately deliver such
Instrument or Chattel Paper to the Administrative Agent, duly indorsed in a
manner satisfactory to the Administrative Agent, or, if consented to by the
Administrative Agent, shall xxxx all such Instruments and Chattel Paper with the
following legend: "This writing and the obligations evidenced or secured hereby
are subject to the security interest of Credit Suisse First Boston, as
Administrative Agent".
SECTION 4.8 INTELLECTUAL PROPERTY
(a) Such Grantor (either itself or through licensees) shall, subject
to past practices in the Grantor's sound business judgment, (i) continue to use
each Trademark that is Material Intellectual Property in order to maintain such
Trademark in full force and effect with respect to each class of goods for which
such Trademark is currently used, free from any claim of abandonment for
non-use, (ii) maintain as in the past the quality of products and services
offered under such Trademark, (iii) use such Trademark with the appropriate
notice of registration and all other notices and legends required by applicable
Requirements of Law, (iv) not adopt or use any xxxx that is confusingly similar
or a colorable imitation of such Trademark unless the Administrative Agent shall
obtain a perfected security interest in such xxxx pursuant to this Agreement and
(v) not (and not permit any licensee or sublicensee thereof to) do any act or
knowingly omit to do any act whereby such Trademark may become invalidated or
impaired in any way.
(b) Subject to past practices in the Grantor's sound business
judgment, such Grantor (either itself or through licensees) shall not do any
act, or omit to do any act, whereby any Patent that is Material Intellectual
Property may become forfeited, abandoned or dedicated to the public.
(c) Subject to past practices in the Grantor's sound business
judgment, such Grantor (either itself or through licensees) (i) shall not (and
shall not permit any licensee or sublicensee thereof to) do any act or omit to
do any act whereby any portion of the Copyrights that is Material Intellectual
Property may become invalidated or otherwise impaired and (ii) shall not (either
itself or through licensees) do any act whereby any portion of the Copyrights
that is Material Intellectual Property may fall into the public domain.
(d) Subject to past practices in the Grantor's sound business
judgment, such Grantor (either itself or through licensees) shall not do any
act, or omit to do any act, whereby any trade secret that is Material
Intellectual Property may become publicly available or otherwise unprotectable.
(e) Subject to past practices in the Grantor's sound business
judgment, such Grantor (either itself or through licensees) shall not do any act
that knowingly uses any Material Intellectual Property to infringe the
intellectual property rights of any other Person.
(f) Such Grantor shall notify the Administrative Agent within 10
Business Days if it knows, or has reason to know, that any application or
registration relating to any Material Intellectual Property may become
forfeited, abandoned or dedicated to the public, or of any adverse determination
or development (including the institution of, or any such determination
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or development in, any proceeding in the United States Patent and Trademark
Office, the United States Copyright Office or any court or tribunal in any
country) regarding such Grantor's ownership of, right to use, interest in, or
the validity of, any Material Intellectual Property or such Grantor's right
to register the same or to own and maintain the same.
(g) Whenever such Grantor, either by itself or through any agent,
licensee or designee, shall file an application for the registration of any
Material Intellectual Property with the United States Patent and Trademark
Office, the United States Copyright Office or any similar office or agency
within or outside the United States, such Grantor shall report such filing to
the Administrative Agent within five Business Days after the last day of the
fiscal quarter in which such filing occurs. Upon request of the
Administrative Agent, such Grantor shall execute and deliver, and have
recorded, all agreements, instruments, documents and papers as the
Administrative Agent may request to evidence the Administrative Agent's
security interest in any Material Intellectual Property and the goodwill and
general intangibles of such Grantor relating thereto or represented thereby.
(h) Subject to past practices in the Grantor's sound business
judgment, such Grantor shall take all reasonable actions necessary or
requested by the Administrative Agent, including in any proceeding before the
United States Patent and Trademark Office, the United States Copyright Office
or any similar office or agency, to maintain and pursue each application (and
to obtain the relevant registration) and to maintain each registration of any
Copyright, Trademark or Patent that is Material Intellectual Property,
including filing of applications for renewal, affidavits of use, affidavits
of incontestability and opposition and interference and cancellation
proceedings.
(i) In the event that any Material Intellectual Property is
infringed upon or misappropriated or diluted by a third party, such Grantor
shall notify the Administrative Agent promptly after such Grantor learns
thereof. Subject to past practices in the Grantor's sound business judgment,
such Grantor shall take appropriate action in response to such infringement,
misappropriation of dilution, including promptly bringing suit for
infringement, misappropriation or dilution and to recover any damage for such
infringement, misappropriation of dilution, and shall take such other actions
may be appropriate in its reasonable judgment under the circumstances to
protect such Material Intellectual Property.
(j) Unless otherwise agreed to by the Administrative Agent, such
Grantor shall execute and deliver to the Administrative Agent for filing in
(i) the United States Copyright Office a short-form copyright security
agreement in the form attached hereto as ANNEX 5 (FORM OF SHORT FORM
COPYRIGHT SECURITY AGREEMENT), (ii) in the United States Patent and Trademark
Office a short-form patent security agreement in the form attached hereto as
ANNEX 6 (FORM OF SHORT FORM PATENT SECURITY AGREEMENT) and (iii) the United
States Patent and Trademark Office a short-form trademark security agreement
in form attached hereto as ANNEX 7 (FORM OF SHORT FORM TRADEMARK SECURITY
AGREEMENT).
SECTION 4.9 VEHICLES
Upon the request of the Administrative Agent, within 15 days after
the date of such request and, with respect to any Vehicle acquired by such
Grantor subsequent to the date of any such request, within 15 days after the
date of acquisition thereof, such Grantor shall file all applications for
certificates of title or ownership indicating the Administrative Agent's first
priority security interest in the Vehicle covered by such certificate and any
other necessary
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documentation, in each office in each jurisdiction that the Administrative
Agent shall deem advisable to perfect its security interests in the Vehicles.
SECTION 4.10 PAYMENT OF OBLIGATIONS
Such Grantor shall pay and discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all taxes,
assessments and governmental charges or levies imposed upon the Collateral or in
respect of income or profits therefrom, as well as all claims of any kind
(including claims for labor, materials and supplies) against or with respect to
the Collateral, except that no such charge need be paid if the amount or
validity thereof is currently being contested in good faith by appropriate
proceedings, reserves in conformity with GAAP with respect thereto have been
provided on the books of such Grantor and such proceedings could not reasonably
be expected to result in the sale, forfeiture or loss of any material portion of
the Collateral or any interest therein.
SECTION 4.11 ASSIGNABLE GOVERNMENT CONTRACTS
(a) On or before the Closing Date, each Grantor shall have executed
and delivered to the Administrative Agent Notices of Assignment of Government
Contracts and three (3) original Assignments of Government Contracts
substantially in the form of ANNEX 8 (FORM OF NOTICE OF ASSIGNMENT OF GOVERNMENT
CONTRACT) and ANNEX 9 (FORM OF ASSIGNMENT OF GOVERNMENT CONTRACT) for each
Assignable Government Contract in effect on the Closing Date and having an
initial stated contract value to such Grantor in excess of $1,000,000. Upon the
filing by the Administrative Agent with (i) the proper contracting officer or
the proper agency head, as applicable, (ii) the proper disbursing officer
designated in the applicable Assignable Government Contract and (iii) where
applicable, the proper surety on any bond applicable to the Assignable
Government Contract (in each case, as specified by the Grantor with respect to
each Assignable Government Contract in accordance with this SECTION 4.11
(ASSIGNABLE GOVERNMENT CONTRACTS)), of one original and three copies of a notice
of assignment substantially in the form of ANNEX 8 (FORM OF ASSIGNMENT OF
GOVERNMENT CONTRACT) and one true copy of the instrument of assignment
substantially in the form of ANNEX 9 (FORM OF ASSIGNMENT OF GOVERNMENT CONTRACT)
with respect to each Assignable Government Contract, this Agreement shall
constitute a valid assignment of such Assignable Government Contract to the
extent that such validity and assignment are governed by the Assignment of
Claims Act.
(b) Within 90 days after any Government Contract becomes an
Assignable Government Contract having an initial stated contract value to any
Grantor in excess of $1,000,000, such Grantor shall execute and deliver to the
Administrative Agent (i) a notice of assignment substantially in the form of
ANNEX 8 (FORM OF ASSIGNMENT OF GOVERNMENT CONTRACT) and (ii) instrument of
assignment substantially in the form of ANNEX 9 (FORM OF ASSIGNMENT OF
GOVERNMENT CONTRACT) with respect to such Assignable Government Contract. The
notices of assignment required by this CLAUSE (b) shall include with respect to
each Assignable Government Contract a notice of assignment addressed to (i) the
proper disbursing officer or the proper agency head, as applicable, (ii) the
proper disbursing officer designated in the applicable Assignable Government
Contract and (iii) where applicable, the proper surety on any bond applicable to
the Assignable Government Contract.
(c) If an Event of Default shall have occurred and be continuing
(or, if the Obligations or the maturity thereof shall have been accelerated
pursuant to this agreement) then, the Administrative Agent may and, at the
request of the Requisite Lenders, shall, at the Grantors'
19
expense, file, deliver and record with the applicable Government Authority,
in accordance with the Assignment of Claims Act, any statement, notice,
assignment, agreement or other document executed or delivered pursuant to
this SECTION 4.11 (ASSIGNABLE GOVERNMENT CONTRACTS) with respect to
Assignable Government Contracts.
(d) Consistent with the foregoing, each Grantor agrees to execute
such other documents and agreements and to take such other action as may be
reasonably necessary or appropriate to implement this CLAUSE (a) and the
consummation of the transactions contemplated hereby, including the assignment
of the Assignable Government Contracts and the assignment of any other
Contractual Obligation with any Governmental Authority.
SECTION 4.12 REPRESENTATIONS AND WARRANTIES; COVENANTS
Each Grantor hereby (a) represents and warrants, on each date as
required by SECTION 3.2(b)(i) (CONDITIONS PRECEDENT TO EACH LOAN AND LETTER OF
CREDIT) of the Credit Agreement, that the representations and warranties as to
it or Collateral held by it made in ARTICLE IV (REPRESENTATIONS AND WARRANTIES)
of the Credit Agreement are true and correct as of such date, (b) agrees to
take, or refrain from taking, as the case may be, each action necessary to be
taken or not taken, as the case may be, so that no Default or Event of Default
is caused by the Grantor's failure to take such action or to refrain from taking
such action and (c) agrees to be bound by all of the provisions of the Credit
Agreement applying to Loan Parties or to Collateral held by it.
ARTICLE V REMEDIAL PROVISIONS
SECTION 5.1 CODE AND OTHER REMEDIES
During the continuance of an Event of Default, the Administrative
Agent may exercise, in addition to all other rights and remedies granted to it
in this Agreement and in any other instrument or agreement securing, evidencing
or relating to the Secured Obligations, all rights and remedies of a secured
party under the UCC or any other applicable law. Without limiting the generality
of the foregoing, the Administrative Agent, without demand of performance or
other demand, presentment, protest, advertisement or notice of any kind (except
any notice required by law referred to below) to or upon any Grantor or any
other Person (all and each of which demands, defenses, advertisements and
notices are hereby waived), may in such circumstances forthwith collect,
receive, appropriate and realize upon any Collateral, and may forthwith sell,
lease, assign, give option or options to purchase, or otherwise dispose of and
deliver any Collateral (or contract to do any of the foregoing), in one or more
parcels at public or private sale or sales, at any exchange, broker's board or
office of the Administrative Agent or any Lender or elsewhere upon such terms
and conditions as it may deem advisable and at such prices as it may deem best,
for cash or on credit or for future delivery without assumption of any credit
risk. The Administrative Agent shall have the right upon any such public sale or
sales, and, to the extent permitted by law, upon any such private sale or sales,
to purchase the whole or any part of the Collateral so sold, free of any right
or equity of redemption in any Grantor, which right or equity is hereby waived
and released. Each Grantor further agrees, at the Administrative Agent's
request, to assemble the Collateral and make it available to the Administrative
Agent at places that the Administrative Agent shall reasonably select, whether
at such Grantor's premises or elsewhere. The Administrative Agent shall apply
the net proceeds of any action taken by it pursuant to this SECTION 5.1, after
deducting all reasonable costs and expenses of every kind incurred in connection
therewith or incidental to the care or safekeeping of any Collateral or in
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any way relating to the Collateral or the rights of the Administrative Agent
and any other Secured Party hereunder, including reasonable attorneys' fees
and disbursements, to the payment in whole or in part of the Secured
Obligations, in such order as the Credit Agreement shall prescribe, and only
after such application and after the payment by the Administrative Agent of
any other amount required by any provision of law, need the Administrative
Agent account for the surplus, if any, to any Grantor. To the extent
permitted by applicable law, each Grantor waives all claims, damages and
demands it may acquire against the Administrative Agent or any other Secured
Party arising out of the exercise by them of any rights hereunder. If any
notice of a proposed sale or other disposition of Collateral shall be
required by law, such notice shall be deemed reasonable and proper if given
at least 15 days before such sale or other disposition.
SECTION 5.2 ACCOUNTS AND PAYMENTS IN RESPECT OF GENERAL
INTANGIBLES
(a) If required by the Administrative Agent at any time during the
continuance of an Event of Default, any payment of Accounts (except for those
Accounts that are part of the Surety Collateral, as long as the Surety shall
have a first-priority security interest therein under the Surety Facility and
the Surety Intercreditor Agreement) or payment in respect of General Intangibles
(except for General Intangibles that are part of the Surety Collateral, as long
as the Surety shall have a first-priority security interest therein under the
Surety Facility and the Surety Intercreditor Agreement), when collected by any
Grantor, shall be forthwith (and, in any event, within five Business Days)
deposited by such Grantor in the exact form received, duly indorsed by such
Grantor to the Administrative Agent if required, in a Cash Collateral Account,
subject to withdrawal by the Administrative Agent as provided in SECTION 5.4
(PROCEEDS TO BE TURNED OVER TO ADMINISTRATIVE AGENT). Until so turned over, such
payment shall be held by such Grantor in trust for the Administrative Agent,
segregated from other funds of such Grantor. Each such deposit of Proceeds of
Accounts and payments in respect of General Intangibles shall be accompanied by
a report identifying in reasonable detail the nature and source of the payments
included in the deposit.
(b) At the Administrative Agent's request, during the continuance of
an Event of Default, each Grantor shall deliver to the Administrative Agent all
original and other documents evidencing, and relating to, the agreements and
transactions that gave rise to the Accounts or payments in respect of General
Intangibles, including all original orders, invoices and shipping receipts.
(c) The Administrative Agent may, without notice, at any time during
the continuance of an Event of Default, limit or terminate the authority of a
Grantor to collect its Accounts (except for those Accounts that are part of the
Surety Collateral, as long as the Surety shall have a first-priority security
interest therein under the Surety Facility and the Surety Intercreditor
Agreement) or amounts due under General Intangibles (except for General
Intangibles that are part of the Surety Collateral, as long as the Surety shall
have a first-priority security interest therein under the Surety Facility and
the Surety Intercreditor Agreement) or any thereof.
(d) The Administrative Agent in its own name or in the name of
others may at any time during the continuance of an Event of Default communicate
with Account Debtors to verify with them to the Administrative Agent's
satisfaction the existence, amount and terms of any Account or amounts due under
any General Intangible, other than Accounts or General Intangibles in which the
Surety has been granted a security interest under the Surety Facility and the
Surety Intercreditor Agreement.
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(e) Upon the request of the Administrative Agent at any time during
the continuance of an Event of Default, each Grantor shall notify Account
Debtors that the Accounts (other than Accounts in which the Surety has been
granted a security interest under the Surety Facility and the Surety
Intercreditor Agreement) or General Intangibles (other than General Intangibles
in which the Surety has been granted a security interest under the Surety
Facility and the Surety Intercreditor Agreement) have been collaterally assigned
to the Administrative Agent and that payments in respect thereof shall be made
directly to the Administrative Agent. In addition, the Administrative Agent may
at any time during the continuance of an Event of Default enforce such Grantor's
rights against such Account Debtors and obligors of General Intangibles.
(f) Anything herein to the contrary notwithstanding, each Grantor
shall remain liable under each of the Accounts and payments in respect of
General Intangibles to observe and perform all the conditions and obligations to
be observed and performed by it thereunder, all in accordance with the terms of
any agreement giving rise thereto. Neither the Administrative Agent nor any
other Secured Party shall have any obligation or liability under any agreement
giving rise to an Account or a payment in respect of a General Intangible by
reason of or arising out of this Agreement or the receipt by the Administrative
Agent nor any other Secured Party of any payment relating thereto, nor shall the
Administrative Agent nor any other Secured Party be obligated in any manner to
perform any obligation of any Grantor under or pursuant to any agreement giving
rise to an Account or a payment in respect of a General Intangible, to make any
payment, to make any inquiry as to the nature or the sufficiency of any payment
received by it or as to the sufficiency of any performance by any party
thereunder, to present or file any claim, to take any action to enforce any
performance or to collect the payment of any amounts that may have been assigned
to it or to which it may be entitled at any time or times.
SECTION 5.3 PLEDGED COLLATERAL
(a) During the continuance of an Event of Default, upon notice by
the Administrative Agent to the relevant Grantor or Grantors, (i) the
Administrative Agent shall have the right to receive any Proceeds of the Pledged
Collateral and make application thereof to the Obligations in the order set
forth in the Credit Agreement and (ii) the Administrative Agent or its nominee
may exercise (A) any voting, consent, corporate and other right pertaining to
the Pledged Collateral at any meeting of shareholders, partners or members, as
the case may be, of the relevant issuer or issuers of Pledged Collateral or
otherwise and (B) any right of conversion, exchange and subscription and any
other right, privilege or option pertaining to the Pledged Collateral as if it
were the absolute owner thereof (including the right to exchange at its
discretion any of the Pledged Collateral upon the merger, consolidation,
reorganization, recapitalization or other fundamental change in the corporate
structure of any issuer of Pledged Securities, the right to deposit and deliver
any Pledged Collateral with any committee, depositary, transfer agent, registrar
or other designated agency upon such terms and conditions as the Administrative
Agent may determine), all without liability except to account for property
actually received by it; PROVIDED, HOWEVER, that the Administrative Agent shall
have no duty to any Grantor to exercise any such right, privilege or option and
shall not be responsible for any failure to do so or delay in so doing.
(b) In order to permit the Administrative Agent to exercise the
voting and other consensual rights that it may be entitled to exercise pursuant
hereto and to receive all dividends and other distributions that it may be
entitled to receive hereunder, (i) each Grantor shall promptly execute and
deliver (or cause to be executed and delivered) to the Administrative Agent all
such proxies, dividend payment orders and other instruments as the
Administrative Agent may
22
from time to time reasonably request and (ii) without limiting the effect of
CLAUSE (i) above, such Grantor hereby grants to the Administrative Agent an
irrevocable proxy to vote all or any part of the Pledged Collateral and to
exercise all other rights, powers, privileges and remedies to which a holder
of the Pledged Collateral would be entitled (including giving or withholding
written consents of shareholders, partners or members, as the case may be,
calling special meetings of shareholders, partners or members, as the case
may be, and voting at such meetings), which proxy shall be effective,
automatically and without the necessity of any action (including any transfer
of any Pledged Collateral on the record books of the issuer thereof) by any
other person (including the issuer of such Pledged Collateral or any officer
or agent thereof) during the continuance of an Event of Default and which
proxy shall only terminate upon the payment in full of the Secured
Obligations.
(c) Each Grantor hereby expressly authorizes and instructs each
issuer of any Pledged Collateral pledged hereunder by such Grantor to (i) comply
with any instruction received by it from the Administrative Agent in writing
that (A) states that an Event of Default has occurred and is continuing and (B)
is otherwise in accordance with the terms of this Agreement, without any other
or further instructions from such Grantor, and each Grantor agrees that such
issuer shall be fully protected in so complying and (ii) unless otherwise
expressly permitted hereby, pay any dividend or other payment with respect to
the Pledged Collateral directly to the Administrative Agent
SECTION 5.4 PROCEEDS TO BE TURNED OVER TO ADMINISTRATIVE AGENT
All Proceeds received by the Administrative Agent hereunder shall be
held by the Administrative Agent in a Cash Collateral Account. All Proceeds
while held by the Administrative Agent in a Cash Collateral Account (or by such
Grantor in trust for the Administrative Agent) shall continue to be held as
collateral security for the Secured Obligations and shall not constitute payment
thereof until applied as provided in the Credit Agreement.
SECTION 5.5 REGISTRATION RIGHTS
(a) If the Administrative Agent shall determine to exercise its
right to sell any the Pledged Collateral pursuant to SECTION 5.1 (CODE AND OTHER
REMEDIES), and if in the opinion of the Administrative Agent it is necessary or
advisable to have the Pledged Collateral, or any portion thereof to be
registered under the provisions of the Securities Act, the relevant Grantor
shall cause the issuer thereof to (i) execute and deliver, and cause the
directors and officers of such issuer to execute and deliver, all such
instruments and documents, and do or cause to be done all such other acts as may
be, in the opinion of the Administrative Agent, necessary or advisable to
register the Pledged Collateral, or that portion thereof to be sold, under the
provisions of the Securities Act, (ii) use its best efforts to cause the
registration statement relating thereto to become effective and to remain
effective for a period of one year from the date of the first public offering of
the Pledged Collateral, or that portion thereof to be sold and (iii) make all
amendments thereto or to the related prospectus that, in the opinion of the
Administrative Agent, are necessary or advisable, all in conformity with the
requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto. Each Grantor agrees to
cause such issuer to comply with the provisions of the securities or "Blue Sky"
laws of any jurisdiction that the Administrative Agent shall designate and to
make available to its security holders, as soon as practicable, an earnings
statement (which need not be audited) satisfying the provisions of Section 11(a)
of the Securities Act.
23
(b) Each Grantor recognizes that the Administrative Agent may be
unable to effect a public sale of any Pledged Collateral by reason of certain
prohibitions contained in the Securities Act and applicable state securities
laws or otherwise or may determine that a public sale is impracticable or not
commercially reasonable and, accordingly, may resort to one or more private
sales thereof to a restricted group of purchasers that shall be obliged to
agree, among other things, to acquire such securities for their own account for
investment and not with a view to the distribution or resale thereof. Each
Grantor acknowledges and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The Administrative
Agent shall be under no obligation to delay a sale of any Pledged Collateral for
the period of time necessary to permit the issuer thereof to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if such issuer would agree to do so.
(c) Each Grantor agrees to use its best efforts to do or cause to be
done all such other acts as may be necessary to make such sale or sales of all
or any portion of the Pledged Collateral pursuant to this SECTION 5.5 valid and
binding and in compliance with all other applicable Requirements of Law. Each
Grantor further agrees that a breach of any covenant contained in this SECTION
5.5 will cause irreparable injury to the Administrative Agent and other Secured
Parties, that the Administrative Agent and the other Secured Parties have no
adequate remedy at law in respect of such breach and, as a consequence, that
each and every covenant contained in this SECTION 5.5 shall be specifically
enforceable against such Grantor, and such Grantor hereby waives and agrees not
to assert any defense against an action for specific performance of such
covenants except for a defense that no Event of Default has occurred under the
Credit Agreement.
SECTION 5.6 DEFICIENCY
Each Grantor shall remain liable for any deficiency if the proceeds
of any sale or other disposition of the Collateral are insufficient to pay the
Secured Obligations and the fees and disbursements of any attorney employed by
the Administrative Agent or any other Secured Party to collect such deficiency.
ARTICLE VI THE ADMINISTRATIVE AGENT
SECTION 6.1 ADMINISTRATIVE AGENT'S APPOINTMENT AS
ATTORNEY-IN-FACT
(a) Each Grantor hereby irrevocably constitutes and appoints the
Administrative Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of such Grantor and in the name of
such Grantor or in its own name, for the purpose of carrying out the terms of
this Agreement, to take any appropriate action and to execute any document and
instrument that may be necessary or desirable to accomplish the purposes of this
Agreement, and, without limiting the generality of the foregoing, each Grantor
hereby gives the Administrative Agent the power and right, on behalf of such
Grantor, without notice to or assent by such Grantor, to do any of the
following:
(i) in the name of such Grantor or its own name, or otherwise, take
possession of and indorse and collect any check, draft, note, acceptance
or other instrument for the payment of moneys due under any Account or
General Intangible or
24
with respect to any other Collateral and file any claim or take any
other action or proceeding in any court of law or equity or otherwise
deemed appropriate by the Administrative Agent for the purpose of
collecting any such moneys due under any Account or General
Intangible or with respect to any other Collateral whenever payable;
(ii) in the case of any Intellectual Property, execute and deliver,
and have recorded, any agreement, instrument, document and paper as the
Administrative Agent may request to evidence the Administrative Agent's
security interest in such Intellectual Property and the goodwill and
General Intangibles of such Grantor relating thereto or represented
thereby;
(iii) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral, effect any repair or pay or discharge
any insurance called for by the terms of this Agreement (including all or
any part of the premiums therefor and the costs thereof);
(i) execute, in connection with any sale provided for in SECTION 5.1
(CODE AND OTHER REMEDIES) or 5.5 (REGISTRATION RIGHTS), any endorsement,
assignment or other instrument of conveyance or transfer with respect to
the Collateral; or
(ii) (A) direct any party liable for any payment under any
Collateral to make payment of any moneys due or to become due thereunder
directly to the Administrative Agent or as the Administrative Agent shall
direct, (B) ask or demand for, collect, and receive payment of and receipt
for, any moneys, claims and other amounts due or to become due at any time
in respect of or arising out of any Collateral, (C) sign and indorse any
invoice, freight or express xxxx, xxxx of lading, storage or warehouse
receipt, draft against debtors, assignment, verification, notice and other
document in connection with any Collateral, (D) commence and prosecute any
suit, action or proceeding at law or in equity in any court of competent
jurisdiction to collect the Collateral or any portion thereof and to
enforce any other right in respect of any Collateral, (E) defend any suit,
action or proceeding brought against such Grantor with respect to any
Collateral, (F) settle, compromise or adjust any such suit, action or
proceeding and, in connection therewith, give such discharges or releases
as the Administrative Agent may deem appropriate, (G) assign any
Copyright, Patent or Trademark (along with the goodwill of the business to
which any such Trademark pertains) throughout the world for such term or
terms, on such conditions, and in such manner as the Administrative Agent
shall in its sole discretion determine, including the execution and filing
of any document necessary to effectuate or record such assignment and (H)
generally, sell, transfer, pledge and make any agreement with respect to
or otherwise deal with any Collateral as fully and completely as though
the Administrative Agent were the absolute owner thereof for all purposes,
and do, at the Administrative Agent's option and such Grantor's expense,
at any time, or from time to time, all acts and things that the
Administrative Agent deems necessary to protect, preserve or realize upon
the Collateral and the Administrative Agent's and the other Secured
Parties' security interests therein and to effect the intent of this
Agreement, all as fully and effectively as such Grantor might do.
Anything in this CLAUSE (a) to the contrary notwithstanding, the Administrative
Agent may not exercise any right under the power of attorney provided for in
this CLAUSE (a) unless an Event of Default shall be continuing.
25
(b) If any Grantor fails to perform or comply with any of its
agreements contained herein, the Administrative Agent, at its option, but
without any obligation so to do, may perform or comply, or otherwise cause
performance or compliance, with such agreement.
(c) The reasonable expenses of the Administrative Agent incurred in
connection with actions undertaken as provided in this SECTION 6.1, together
with interest thereon at a rate per annum equal to the rate per annum at which
interest would then be payable on past due Revolving Loans that are Base Rate
Loans under the Credit Agreement, from the date of payment by the Administrative
Agent to the date reimbursed by the relevant Grantor, shall be payable by such
Grantor to the Administrative Agent on demand.
(d) Each Grantor hereby ratifies all that said attorneys shall
lawfully do or cause to be done by virtue hereof. All powers, authorizations and
agencies contained in this Agreement are coupled with an interest and are
irrevocable until this Agreement is terminated and the security interests
created hereby are released.
SECTION 6.2 DUTY OF ADMINISTRATIVE AGENT
The Administrative Agent's sole duty with respect to the custody,
safekeeping and physical preservation of the Collateral in its possession shall
be to deal with it in the same manner as the Administrative Agent deals with
similar property for its own account. Neither the Administrative Agent, any
other Secured Party nor any of their respective officers, directors, employees
or agents shall be liable for failure to demand, collect or realize upon any
Collateral or for any delay in doing so or shall be under any obligation to sell
or otherwise dispose of any Collateral upon the request of any Grantor or any
other Person or to take any other action whatsoever with regard to any
Collateral. The powers conferred on the Administrative Agent hereunder are
solely to protect the Administrative Agent's interest in the Collateral and
shall not impose any duty upon the Administrative Agent or any other Secured
Party to exercise any such powers. The Administrative Agent and the other
Secured Parties shall be accountable only for amounts that they actually receive
as a result of the exercise of such powers, and neither they nor any of their
respective officers, directors, employees or agents shall be responsible to any
Grantor for any act or failure to act hereunder, except for their own gross
negligence or willful misconduct.
SECTION 6.3 EXECUTION OF FINANCING STATEMENTS
Each Grantor authorizes the Administrative Agent to file or record
financing statements and other filing or recording documents or instruments with
respect to the Collateral without the signature of such Grantor in such form and
in such offices as the Administrative Agent reasonably determines appropriate to
perfect the security interests of the Administrative Agent under this Agreement.
A photographic or other reproduction of this Agreement shall be sufficient as a
financing statement or other filing or recording document or instrument for
filing or recording in any jurisdiction.
SECTION 6.4 AUTHORITY OF ADMINISTRATIVE AGENT
Each Grantor acknowledges that the rights and responsibilities of
the Administrative Agent under this Agreement with respect to any action taken
by the Administrative Agent or the exercise or non-exercise by the
Administrative Agent of any option, voting right, request, judgment or other
right or remedy provided for herein or resulting or arising
26
out of this Agreement shall, as between the Administrative Agent and the
other Secured Parties, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them,
but, as between the Administrative Agent and the Grantors, the Administrative
Agent shall be conclusively presumed to be acting as agent for the
Administrative Agent and the other Secured Parties with full and valid
authority so to act or refrain from acting, and no Grantor shall be under any
obligation, or entitlement, to make any inquiry respecting such authority.
ARTICLE VII MISCELLANEOUS
SECTION 7.1 AMENDMENTS IN WRITING
None of the terms or provisions of this Agreement may be waived,
amended, supplemented or otherwise modified except in accordance with SECTION
11.1 (AMENDMENTS, WAIVERS, ETC.) of the Credit Agreement.
SECTION 7.2 NOTICES
All notices, requests and demands to or upon the Administrative
Agent or any Grantor hereunder shall be effected in the manner provided for in
SECTION 11.8 (NOTICES, ETC.) of the Credit Agreement; PROVIDED, HOWEVER, that
any such notice, request or demand to or upon any Grantor shall be addressed in
case of the Borrower at the Borrower's notice address set forth in such SECTION
11.8.
SECTION 7.3 NO WAIVER BY COURSE OF CONDUCT; CUMULATIVE
REMEDIES
Neither the Administrative Agent nor any other Secured Party shall
by any act (except by a written instrument pursuant to SECTION 7.1 (AMENDMENTS
IN WRITING)), delay, indulgence, omission or otherwise be deemed to have waived
any right or remedy hereunder or to have acquiesced in any Default or Event of
Default. No failure to exercise, nor any delay in exercising, on the part of the
Administrative Agent or any other Secured Party, any right, power or privilege
hereunder shall operate as a waiver thereof. No single or partial exercise of
any right, power or privilege hereunder shall preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. A
waiver by the Administrative Agent or any other Secured Party of any right or
remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy that the Administrative Agent or such other Secured Party would
otherwise have on any future occasion. The rights and remedies herein provided
are cumulative, may be exercised singly or concurrently and are not exclusive of
any other rights or remedies provided by law.
SECTION 7.4 SUCCESSORS AND ASSIGNS
This Agreement shall be binding upon the successors and assigns of
each Grantor and shall inure to the benefit of the Administrative Agent and each
other Secured Party and their successors and assigns; PROVIDED, HOWEVER, that no
Grantor may assign, transfer or delegate any of its rights or obligations under
this Agreement without the prior written consent of the Administrative Agent.
27
SECTION 7.5 COUNTERPARTS
This Agreement may be executed by one or more of the parties to this
Agreement on any number of separate counterparts (including by telecopy), each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement. Signature pages may
be detached from multiple counterparts and attached to a single counterpart so
that all signature pages are attached to the same document. Delivery of an
executed counterpart by telecopy shall be effective as delivery of a manually
executed counterpart.
SECTION 7.6 SEVERABILITY
Any provision of this Agreement that 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, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 7.7 SECTION HEADINGS
The Article and Section titles contained in this Agreement are, and
shall be, without substantive meaning or content of any kind whatsoever and are
not part of the agreement of the parties hereto.
SECTION 7.8 ENTIRE AGREEMENT
This Agreement together with the other Loan Documents represents the
entire agreement of the parties and supersedes all prior agreements and
understandings relating to the subject matter hereof.
SECTION 7.9 GOVERNING LAW
This agreement and the rights and obligations of the parties hereto
shall be governed by, and construed and interpreted in accordance with, the law
of the State of
New York.
SECTION 7.10 ADDITIONAL GRANTORS
If, pursuant to SECTION 7.11 (ADDITIONAL COLLATERAL AND GUARANTIES)
of the Credit Agreement, the Borrower shall be required to cause any Subsidiary
that is not a Grantor to become a Grantor hereunder, such Subsidiary shall
execute and deliver to the Administrative Agent a Joinder Agreement in the form
of ANNEX 4 (FORM OF JOINDER AGREEMENT) and shall thereafter for all purposes be
a party hereto and have the same rights, benefits and obligations as a Grantor
party hereto on the Closing Date.
SECTION 7.11 RELEASE OF COLLATERAL
(a) At the time provided in SECTION 10.8(b)(i) (CONCERNING THE
COLLATERAL AND THE COLLATERAL DOCUMENTS) of the Credit Agreement, the Collateral
shall be released from the Lien created hereby and this Agreement and all
obligations (other than those expressly stated to survive such termination) of
the Administrative Agent and each Grantor hereunder shall
28
terminate, all without delivery of any instrument or performance of any act
by any party, and all rights to the Collateral shall revert to the Grantors.
At the request and sole expense of any Grantor following any such
termination, the Administrative Agent shall deliver to such Grantor any
Collateral of such Grantor held by the Administrative Agent hereunder and
execute and deliver to such Grantor such documents as such Grantor shall
reasonably request to evidence such termination.
(b) If any Collateral shall be sold or disposed of by any Grantor in
a transaction permitted by the Credit Agreement, the Collateral so sold or
disposed of shall be released from the Lien created hereby to the extent
provided in SECTION 10.8(b)(ii) or (iii) (CONCERNING THE COLLATERAL AND THE
COLLATERAL DOCUMENTS) of the Credit Agreement and, in connection therewith, the
Administrative Agent, at the request and sole expense of the Borrower, shall
execute and deliver to the Borrower all releases or other documents reasonably
necessary or desirable for the release of the Lien created hereby on such
Collateral. At the request and sole expense of the Borrower, a Grantor shall be
released from its obligations hereunder in the event that all the capital stock
of such Grantor shall be so sold or disposed; PROVIDED, HOWEVER, that the
Borrower shall have delivered to the Administrative Agent, at least ten Business
Days prior to the date of the proposed release or earlier if agreed by the
Administrative Agent in its sole discretion, a written request for release
identifying the relevant Grantor and the terms of the sale or other disposition
in reasonable detail, including the price thereof and any expenses in connection
therewith, together with a certification by the Borrower stating that such
transaction is in compliance with the Credit Agreement and the other Loan
Documents.
SECTION 7.12 REINSTATEMENT
Each Grantor further agrees that, if any payment made by any Loan
Party or other Person and applied to the Obligations is at any time annulled,
avoided, set aside, rescinded, invalidated, declared to be fraudulent or
preferential or otherwise required to be refunded or repaid, or the proceeds of
Collateral are required to be returned by any Secured Party to such Loan Party,
its estate, trustee, receiver or any other party, including any Grantor, under
any bankruptcy law, state or federal law, common law or equitable cause, then,
to the extent of such payment or repayment, any Lien or other Collateral
securing such liability shall be and remain in full force and effect, as fully
as if such payment had never been made or, if prior thereto the Lien granted
hereby or other Collateral securing such liability hereunder shall have been
released or terminated by virtue of such cancellation or surrender), such Lien
or other Collateral shall be reinstated in full force and effect, and such prior
cancellation or surrender shall not diminish, release, discharge, impair or
otherwise affect any Lien or other Collateral securing the obligations of any
Grantor in respect of the amount of such payment.
[SIGNATURE PAGES FOLLOW]
29
IN WITNESS WHEREOF, each of the undersigned has caused this
Pledge
and Security Agreement to be duly executed and delivered as of the date first
above written.
WASHINGTON GROUP INTERNATIONAL, INC.,
AS GRANTOR
/s/ Xxxxx X. Xxxxx
By: _____________________________________
Name: Xxxxx X. Xxxxx
Title: Authorized Officer
EACH OF THE GRANTORS LISTED ON EXHIBIT A,
AS GRANTOR
/s/ Xxxxx X. Xxxxx
By: _____________________________________
Name: Xxxxx X. Xxxxx
Title: Authorized Officer
ACCEPTED AND AGREED
as of the date first above written:
CREDIT SUISSE FIRST BOSTON,
AS ADMINISTRATIVE AGENT
/s/ Xxxxxx Xxxx
By:_____________________________
Name: Xxxxxx Xxxx
Title:
/s/ Xxxx X. Xxxxx
By:_____________________________
Name: Xxxx X. Xxxxx
Title: Associate
[SIGNATURE PAGE TO
PLEDGE AND SECURITY AGREEMENT FOR WASHINGTON GROUP
INTERNATIONAL, INC.'S CREDIT AGREEMENT]
Exhibit A
-------------------------------------------------------------------------------------------------------------------
Company Name Jurisdiction
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Asia Badger, Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Badger America, Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Badger Energy, Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Badger Middle East Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Catalytic Industrial Maintenance Co., Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
CF Environmental Corporation Massachusetts
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Cia. Internacional de Ingenieria, S.A. Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Ebasco International Corporation Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Emkay Capital Investments, Inc. Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Energy Overseas International, Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Gulf Design Corporation Inc. Florida
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Xxxxxxx-Xxxxxxx Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
HCC Holding, Inc. California
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Industrial Constructors Corp. Montana
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
XxXxxxx Xxxxxxxx & Associates Inc. Texas
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Middle East Holdings Limited (f/k/a Raytheon Engineers & Colorado
Constructors Middle East Limited)
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
MK Aviation Services, Inc. Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
MK Capital Company Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
MK Construction, Inc. Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
MK Nevada LLC Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
MK Train Control, Inc. Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
XX-Xxxxxxxx Engineering Company Michigan
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
XX-Xxxxxxxx of Idaho Company Idaho
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
XX-Xxxxxxxx of Oak Ridge Company Tennessee
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxx Corporation of Viet Nam Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxx Leasing Corporation Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Xxxxxxxx-Xxxxxxx Company, Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Xxxxxxxx-Xxxxxxx Engineers, Inc. Nevada
-------------------------------------------------------------------------------------------------------------------
32
-------------------------------------------------------------------------------------------------------------------
Xxxxxxxx-Xxxxxxx Services, Inc. Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
National Projects Southwest, Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
National Projects, Inc. Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Xxxxxxx Corporation California
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon Architects, Ltd. Colorado
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon Engineers & Constructors (Aruba) Ltd. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon Engineers & Constructors (Ireland) Ltd. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon Engineers & Constructors (Russia) Ltd. Massachusetts
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon Engineers & Constructors Midwest LLC Ohio
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon Engineers & Constructors Midwest, Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon Infrastructure, Inc.
New York
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon Nuclear Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon-Ebasco Indonesia Ltd. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon-Ebasco Overseas Ltd. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Raytheon-Ebasco Pakistan Ltd. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Rust Constructors Puerto Rico, Inc. Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Rust Constructors, Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Specialty Technical Services Inc. Pennsylvania
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Xxxxxxx Catalytic Corporation Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
United Engineers Far East, Ltd. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
United Engineers International, Inc. Pennsylvania
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
United Mid-East, Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Architects LLC Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Construction Corporation Montana
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Contractors Group, Inc. Montana
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Demilitarization Company Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Electrical, Inc. Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Engineering Quality Services Corporation Delaware
(formerly Raytheon Engineering Quality Services
Corporation)
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Group International, Inc. Ohio
-------------------------------------------------------------------------------------------------------------------
33
-------------------------------------------------------------------------------------------------------------------
Washington Group Latin America, Inc. (formerly Raytheon Delaware
Engineers & Constructors Latin America, Inc.)
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Infrastructure Services, Inc. Colorado
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington International, Inc. Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Ohio Services LLC Nevada
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Quality Inspection Company (formerly Raytheon Delaware
Quality Inspection Company)
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington Quality Programs Company Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Washington-Catalytic, Inc. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
WCG Holdings, Inc. Montana
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
WCG Leasing, Inc. Montana
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
WGCI, Inc. (formerly Raytheon Constructors International, Delaware
Inc.)
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
WGI Panama Ltd. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
WGI Trinidad & Tobago Ltd. Delaware
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
Yampa Mining Co. Nevada
-------------------------------------------------------------------------------------------------------------------
34
