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Exhibit 4.4
SECURITY AGREEMENT
between
ANCHOR GLASS ACQUISITION CORPORATION
and
BANKERS TRUST COMPANY,
as Collateral Agent
Dated as of February 5, 1997
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TABLE OF CONTENTS
Page
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ARTICLE I SECURITY INTEREST...................................................................................... 2
1.1 Grant of Security Interest......................................................................... 2
1.2 Power of Attorney.................................................................................. 2
ARTICLE II GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS..................................................... 2
2.1 Necessary Filings.................................................................................. 2
2.2 No Liens........................................................................................... 3
2.3 Other Financing Statements......................................................................... 3
2.4 Chief Executive Office; Records.................................................................... 3
2.5 Location of Equipment.............................................................................. 4
2.6 Trade Names; Change of Name........................................................................ 4
2.7 Recourse........................................................................................... 4
ARTICLE III SPECIAL PROVISIONS CONCERNING CONTRACTS, CONTRACT RIGHTS; INSTRUMENTS; ETC........................... 5
3.1 Additional Representations and Warranties.......................................................... 5
3.2 Maintenance of Records............................................................................. 5
3.3 Inspection......................................................................................... 5
3.4 Modification of Terms; etc......................................................................... 5
3.5 Collection......................................................................................... 6
3.6 Direction to Account Debtors; etc.................................................................. 6
3.7 Instruments........................................................................................ 7
3.8 Collateral Accounts................................................................................ 7
3.9 Receipt of Payments................................................................................ 7
3.10 Account Inspection................................................................................ 7
ARTICLE IV SPECIAL PROVISIONS CONCERNING TRADEMARKS.............................................................. 7
4.1 Additional Representations and Warranties.......................................................... 7
4.2 Licenses and Assignments........................................................................... 8
4.3 Infringements...................................................................................... 8
4.4 Preservation of Trademarks......................................................................... 8
4.5 Maintenance of Registration........................................................................ 8
4.6 Remedies........................................................................................... 9
ARTICLE V SPECIAL PROVISIONS CONCERNING TRADE SECRETS, PATENTS AND COPYRIGHTS.................................... 9
5.1 Additional Representations and Warranties.......................................................... 9
5.2 Licenses and Assignments........................................................................... 10
5.3 Infringements...................................................................................... 10
5.4 Maintenance of Patents............................................................................. 10
5.5 Prosecution of Patent Application.................................................................. 11
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5.6 Remedies........................................................................................... 11
ARTICLE VI PROVISIONS CONCERNING ALL COLLATERAL.................................................................. 11
6.1 General Representations and Warranties............................................................. 11
6.2 Protection of Collateral Agent's Security.......................................................... 11
6.3 Further Actions.................................................................................... 12
6.4 Financing and Continuation Statements.............................................................. 12
ARTICLE VII REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT AND CERTAIN DEFAULTS.................................... 12
7.1 Remedies; Obtaining Collateral Upon Default........................................................ 12
7.2 Remedies; Disposition of Collateral................................................................ 14
7.3 Waiver of Claims................................................................................... 15
7.4 Application of Proceeds............................................................................ 16
7.5 Remedies Cumulative................................................................................ 17
7.6 Discontinuance of Proceedings...................................................................... 17
ARTICLE VIII INDEMNITY........................................................................................... 17
8.1 Indemnity.......................................................................................... 17
8.2 Indemnity Obligations Secured by Collateral; Survival.............................................. 18
ARTICLE IX DEFINITIONS........................................................................................... 19
ARTICLE X MISCELLANEOUS.......................................................................................... 24
10.1 Notices........................................................................................... 24
10.2 Waiver; Amendment................................................................................. 24
10.3 Obligations Absolute.............................................................................. 25
10.4 Successors and Assigns............................................................................ 25
10.5 Headings Descriptive.............................................................................. 25
10.6 Severability...................................................................................... 25
10.7 Waiver of Jury Trial; Consent to Jurisdiction..................................................... 26
10.8 Governing Law..................................................................................... 27
10.9 Assignor's Duties................................................................................. 27
10.10 Termination; Release............................................................................. 27
10.11 Collateral Agent................................................................................. 28
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ANNEX A Location of Chief Executive Office; Record Locations
ANNEX B Schedule of Equipment Locations
ANNEX C Schedule of Trade and Fictitious Names
ANNEX D Schedule of Trademarks
ANNEX E Schedule of Patents and Applications
ANNEX F Schedule of Copyrights and Applications
ANNEX G Assignment of Security Interest in United States Trademarks and Patents
ANNEX H Assignment of Security Interest in United States Copyrights
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SECURITY AGREEMENT
SECURITY AGREEMENT (the "Agreement"), dated as of February 5,
1997 between ANCHOR GLASS ACQUISITION CORPORATION, a Delaware corporation (the
"Assignor"), and Bankers Trust Company, as Collateral Agent (the "Collateral
Agent") for the Secured Creditors (as defined below). Capitalized terms used
herein shall have the meaning specified in Article IX herein or, if not defined
therein, as specified in the Credit Agreement referred to below.
W I T N E S S E T H :
WHEREAS, the Assignor, the financial institutions from time to
time party thereto (the "Lenders"), and Bankers Trust Company, as Agent (the
"Agent"), have entered into a Credit Agreement, dated as of February 5, 1997 (as
amended, modified or supplemented from time to time, the "Credit Agreement"),
providing for the making of Loans (the Lenders from time to time party to the
Credit Agreement, the Collateral Agent and the Agent herein called the "Bank
Creditors");
WHEREAS, the Assignor may from time to time be party to one or
more interest rate agreements (including, without limitation, interest rate
swaps, caps, floors, collars, and similar agreements permitted by the Credit
Agreement) (collectively, the "Interest Rate Agreements," and each such Interest
Rate Agreement with an Interest Rate Creditor (as defined below), a "Secured
Interest Rate Agreement") with Bankers Trust Company, in its individual capacity
("BTCo"), any Lender or a syndicate of financial institutions organized by BTCo
or an affiliate of BTCo (even if BTCo or any such Lender ceases to be a Lender
under the Credit Agreement for any reason), and any institution that
participates, and in each case their subsequent assigns, in such Secured
Interest Rate Agreement (collectively, the "Interest Rate Creditors," and the
Interest Rate Creditors together with the Bank Creditors, collectively, the
"Secured Creditors");
WHEREAS, it is a condition to the making of Loans under the
Credit Agreement that the Assignor shall have executed and delivered to the
Collateral Agent this Agreement; and
WHEREAS, the Assignor desires to execute this Agreement to
satisfy the condition described in the preceding paragraph;
NOW, THEREFORE, in consideration of the foregoing and other
benefits accruing to the Assignor, the receipt and sufficiency of which are
hereby acknowledged, the Assignor hereby makes the following representations and
warranties to the Collateral Agent and hereby covenants and agrees with the
Collateral Agent as follows:
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ARTICLE I
SECURITY INTEREST
1.1 Grant of Security Interest. (a) The Assignor, as security
for the prompt and complete payment and performance when due of all of the
Obligations of the Assignor, does hereby sell, assign and transfer unto the
Collateral Agent, and does hereby grant to the Collateral Agent for the benefit
of the Secured Creditors a continuing security interest in, all of the right,
title and interest of the Assignor in, to and under all of the Collateral.
(b) The security interest of the Collateral Agent under this
Agreement extends to all Collateral of the kind which is the subject of this
Agreement which the Assignor may acquire at any time during the continuation of
this Agreement.
(c) This Agreement constitutes a security agreement with
respect to personal property (including, without limitation, the Intellectual
Property Collateral) under Article 9 of the UCC.
1.2 Power of Attorney. The Assignor hereby constitutes and
appoints the Collateral Agent its true and lawful attorney, irrevocably, with
full power after the occurrence of and during the continuance of an Event of
Default (in the name of the Assignor or otherwise) to act, require, demand,
receive, compound and give acquittance for any and all monies and claims for
monies due or to become due to the Assignor under or arising out of the
Collateral, to endorse any checks or other instruments or orders in connection
therewith and to file any claims or take any action or institute any proceedings
which the Collateral Agent may deem to be necessary or advisable in the
premises, which appointment as attorney is coupled with an interest.
ARTICLE II
GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS
The Assignor represents, warrants and covenants, which
representations, warranties and covenants shall survive execution and delivery
of this Agreement, as follows:
2.1 Necessary Filings. Except as set forth in Section 4.27 of
the Credit Agreement (and on Schedule D to the Credit Agreement), all things,
registrations and recordings necessary or appropriate to create, preserve,
protect, and perfect the security interest granted by the Assignor to the
Collateral Agent hereby in respect of the Collateral will have been accomplished
no later than five days following the Closing Date and the security interest
granted to the Collateral Agent pursuant to this Agreement in and to the
Collateral constitutes a perfected security interest therein prior to the rights
of all other Persons therein, other than the holders of Liens set forth on
Exhibit D to the Credit Agreement, and subject to no other Liens (except Liens
set forth on Exhibit D to the Credit Agreement, Liens which may arise with
respect to the Shared Collateral and Liens which may arise after the date hereof
which pursuant to the operation of law are prior to the perfected security
interests created hereunder ("Future Liens")) and is entitled to
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all the rights, priorities and benefits afforded by the Uniform Commercial Code
or other relevant law as enacted in any relevant jurisdiction to perfected
security interests.
2.2 No Liens. The Assignor is, and as to Collateral acquired
by it from time to time after the date hereof the Assignor will be, the owner of
all Collateral free from any Lien, security interest, encumbrance or other
right, title or interest of any Person (other than Permitted Liens, Liens
created under this Agreement, Liens with respect to the Shared Collateral, and
Future Liens), and the Assignor shall defend the Collateral against all claims
and demands of all Persons at any time claiming the same or any interest therein
adverse to the Collateral Agent.
2.3 Other Financing Statements. On or prior to the 45th day
following the Closing Date, the Assignor shall have caused the termination and
release of any and all financing statements (or similar statement or instrument
of registration under the law of any jurisdiction) on file or of record in any
relevant jurisdiction covering or purporting to cover any interest of any kind
in the Collateral of the Assignor (other than Permitted Liens, Liens created
under this Agreement, Liens with respect to the Shared Collateral, and Future
Liens), and so long as the Total Commitments have not been terminated or any
Note remains outstanding or any of the Obligations remain unpaid or any Interest
Rate Agreement remains in effect or any Obligations are owed with respect
thereto, the Assignor will not execute, authorize or permit to be filed in any
public office any financing statement (or similar statement or instrument of
registration under the law of any jurisdiction) or statements relating to the
Collateral, except financing statements filed or to be filed in respect of and
covering the security interests granted hereby by the Assignor or as permitted
by the Credit Agreement.
2.4 Chief Executive Office; Records. The chief executive
office of the Assignor is located at the address indicated under the name of the
Assignor on Annex A hereto. The Assignor will not move its chief executive
office except to such new location as the Assignor may establish in accordance
with the last sentence of this Section 2.4. The originals of all documents
evidencing Contract Rights and Trade Secrets of the Assignor and the original
books of account and records of the Assignor relating thereto are, and will
continue to be, kept at such chief executive office and/or one or more of the
locations shown on Annex A, or at such new locations as the Assignor may
establish in accordance with the last sentence of this Section 2.4. All Contract
Rights and Trade Secrets are, and will continue to be, maintained at, and
controlled and directed (including, without limitation, for general accounting
purposes) from, the office locations described above, or such new locations as
the Assignor may establish in accordance with the last sentence of this Section
2.4. The Assignor shall not establish new locations for such offices until (i)
it shall have given to the Collateral Agent not less than 45 days' prior written
notice (or such lesser notice as shall be acceptable to the Collateral Agent in
the case of a new record location to be established in connection with newly
acquired Contracts) of its intention to do so, clearly describing such new
location and providing such other information in connection therewith as the
Collateral Agent may reasonably request, and (ii) with respect to such new
location, it shall have taken all action, reasonably satisfactory to the
Collateral Agent, to maintain the perfection and priority of the security
interest of the Collateral Agent in the Collateral intended to be granted hereby
at all times in full force and effect.
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2.5 Location of Equipment. All Equipment held on the date
hereof by the Assignor is located at one of the locations shown on Annex B
attached hereto. The Assignor agrees that all Equipment now held or subsequently
acquired by it shall be kept at (or shall be in transport to or from) any one of
the locations shown on Annex B hereto, or such new location as the Assignor may
establish in accordance with the last sentence of this Section 2.5. The Assignor
may establish a new location for Equipment only if (i) it shall have given to
the Collateral Agent not less than 30 days prior written notice of its intention
so to do, clearly describing such new location and providing such other
information in connection therewith as the Collateral Agent may reasonably
request, and (ii) with respect to such new location, it shall have taken all
action reasonably satisfactory to the Collateral Agent to maintain the
perfection and priority of the security interest of the Collateral Agent in the
Collateral intended to be granted hereby at all times in full force and effect.
2.6 Trade Names; Change of Name. The Assignor does not have or
operate in any jurisdiction under, or in the preceding 12 months has not had and
has not operated in any jurisdiction under, any trade names, fictitious names or
other names (including, without limitation, any names of divisions or
operations) except its legal name and such other trade, fictitious or other
names as are listed under the name of the Assignor on Annex C hereto. The
Assignor has only operated under each name set forth in Annex C in the
jurisdiction or jurisdictions set forth opposite each such name on Annex C. The
Assignor shall not change its legal name or assume or operate in any
jurisdiction under any trade, fictitious or other name except those names listed
on Annex C hereto in the jurisdictions listed with respect to such names and new
names (including, without limitation, any names of divisions or operations)
and/or jurisdictions established in accordance with the last sentence of this
Section 2.5. The Assignor shall not assume or operate in any jurisdiction under
any new trade, fictitious or other name or operate under any existing name in
any additional jurisdiction until (i) it shall have given to the Collateral
Agent not less than 45 days' prior written notice of its intention so to do,
clearly describing such new name and/or jurisdiction and, in the case of a new
name, the jurisdictions in which such new name shall be used and providing such
other information in connection therewith as the Collateral Agent may reasonably
request, and (ii) with respect to such new name and/or new jurisdiction, it
shall have taken all action reasonably required to maintain the perfection and
priority of the security interest of the Collateral Agent in the Collateral
intended to be granted hereby at all times fully perfected and in full force and
effect.
2.7 Recourse. This Agreement is made with full recourse to the
Assignor and pursuant to and upon all the warranties, representations,
covenants, and agreements on the part of the Assignor contained herein, in the
other Loan Documents, in the Interest Rate Agreements and otherwise in writing
in connection herewith or therewith.
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ARTICLE III
SPECIAL PROVISIONS CONCERNING CONTRACTS,
CONTRACT RIGHTS; INSTRUMENTS; ETC.
3.1 Additional Representations and Warranties. The Assignor
shall be deemed to have represented and warranted that any Contracts to which
the Assignor is a party, and all records, papers and documents relating thereto
(if any), are genuine and in all respects what they purport to be, and that all
papers and documents (if any) relating thereto (i) will represent the genuine,
legal, valid and binding obligation of the parties thereto, enforceable in
accordance with their respective terms, subject to adjustments customary in the
business of the Assignor, and evidencing indebtedness unpaid and owed, if any,
to the Assignor arising out of the performance of such Contract, or both, (ii)
will be the only original writings evidencing and embodying such obligation of
the parties named therein (other than copies created for general accounting
purposes), and (iii) will be in compliance and will conform with all applicable
federal, state and local laws and applicable laws of any relevant foreign
jurisdiction.
3.2 Maintenance of Records. The Assignor will keep and
maintain at its own cost and expense satisfactory and complete records of its
Contracts, including, but not limited to, the originals of all documentation
(including each Contract) with respect thereto, records of all payments
received, all credits granted thereon, all merchandise returned and all other
dealings therewith. Upon the occurrence and during the continuance of an Event
of Default, the Assignor shall, upon request of the Collateral Agent and at the
Assignor's own cost and expense, deliver all tangible evidence of its Contract
Rights (including, without limitation, copies of all documents evidencing all
Contracts, such copies to be certified as true and complete by an appropriate
officer of the Assignor) and such books and records to the Collateral Agent or
to its representatives (copies of which evidence and books and records may be
retained by the Assignor) at any time upon its demand. If, upon the occurrence
and during the continuance of an Event of Default, the Collateral Agent so
directs, the Assignor shall legend, in form and manner reasonably satisfactory
to the Collateral Agent, the Contracts, as well as books, records and documents
of the Assignor evidencing or pertaining to the Contracts, with an appropriate
reference to the fact that the Contracts have been assigned to the Collateral
Agent and that the Collateral Agent has a security interest therein.
3.3 Inspection. The Assignor shall permit the Collateral
Agent, and the Collateral Agent's agents, representatives and employees, during
normal business hours and upon reasonable prior notice to Assignor, to inspect
the Collateral and the books and records maintained by the Assignor, or any of
its agents, representatives, and employees in respect of the Collateral and to
make copies of and to take extracts from such records as are reasonably
necessary for Collateral Agent's evaluation of the Collateral, provided that
such inspections shall not materially interfere with the use and operation of
the Collateral.
3.4 Modification of Terms; etc. The Assignor shall not rescind
or cancel any indebtedness evidenced under any Contract of the Assignor, or
modify any term thereof or make any adjustment with respect thereto, or extend
or renew the same, or compromise or settle any
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material dispute, claim, suit or legal proceeding relating thereto, or sell any
Contract of the Assignor, or interest therein, without the prior written consent
of the Collateral Agent (which consent shall not be unreasonably withheld),
except (i) as permitted by Section 3.5 hereof and (ii) so long as no Event of
Default is then in existence in respect of which the Collateral Agent has given
notice that this exception is no longer applicable, the Assignor may modify,
make adjustments with respect to, extend, renew, rescind or cancel any Contracts
or any indebtedness thereunder or compromise or settle any dispute, claim, suit
or legal proceeding relating to any Contract or sell any Contract or interest
therein in the ordinary course of business. Except as set forth in the preceding
sentence, the Assignor will duly fulfill all obligations on its part to be
fulfilled under or in connection with the Contracts of the Assignor and will do
nothing to impair the rights of the Collateral Agent in such Contracts.
3.5 Collection. The Assignor shall, in accordance with its
ordinary business practices, endeavor to cause to be collected from the obligor
under any Contract of the Assignor, as and when due (including, without
limitation, amounts which are delinquent, such amounts to be collected in
accordance with generally accepted lawful collection procedures) any and all
amounts owing under or on account of such Contract, and apply forthwith upon
receipt thereof all such amounts as are so collected to the outstanding balance
under such Contract, except that, so long as no Event of Default is then in
existence in respect of which the Collateral Agent has given notice that this
exception is no longer applicable, the Assignor may allow in the ordinary course
of business as adjustments to amounts owing under its Contracts (i) an extension
or renewal of the time or times of payment, or settlement for less than the
total unpaid balance, which the Assignor finds appropriate in accordance with
reasonable business judgment and (ii) a refund or credit due as a result of
returned or damaged merchandise or improperly performed services or such other
adjustments which the Assignor deems appropriate in the exercise of its
commercially reasonable business judgment. The reasonable costs and expenses
(including, without limitation, reasonable attorneys' fees) of collection,
whether incurred by the Assignor or the Collateral Agent, shall be borne by the
Assignor.
3.6 Direction to Account Debtors; etc. Upon the occurrence and
during the continuance of an Event of Default, and if the Collateral Agent so
directs the Assignor, to the extent permitted by applicable law, the Assignor
agrees (x) to cause all payments otherwise payable to an Indemnity Account or
Loss Proceeds Account to be made directly to the Cash Collateral Account, (y)
that the Collateral Agent may, at its option, directly notify the obligors with
respect to any payments otherwise payable to an Indemnity Account or Loss
Proceeds Account to make payments with respect thereto as provided in preceding
clause (x), and (z) that the Collateral Agent may enforce collection of any such
payments and may adjust, settle or compromise the amount of payment thereof as
though the Collateral Agent were the outright owner thereof. The Collateral
Agent may apply any or all amounts then in, or thereafter deposited in, the Cash
Collateral Account in the manner provided in Section 7.4 of this Agreement. The
reasonable costs and expenses (including reasonable attorneys' fees) of
collection, whether incurred by the Assignor or the Collateral Agent, shall be
borne by the Assignor.
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3.7 Instruments. If the Assignor owns or acquires any
Instrument, the Assignor will within ten Business Days notify the Collateral
Agent thereof, and upon request by the Collateral Agent promptly deliver such
Instrument to the Collateral Agent appropriately endorsed to the order of the
Collateral Agent as further security hereunder.
3.8 Collateral Accounts. (a) The Assignor, pursuant to
Section 5.4(ix) of the Credit Agreement, has established with the Collateral
Agent an Indemnity Account in the sole dominion and control of the Collateral
Agent, which shall be subject to a perfected first priority security interest in
favor of the Collateral Agent.
(b) Loss Proceeds Account. The Assignor, pursuant to Section
5.4(vi) of the Credit Agreement, has established with the Collateral Agent a
Loss Proceeds Account in the sole dominion and control of the Collateral Agent,
which shall be subject to a perfected first priority security interest in favor
of the Collateral Agent.
3.9 Receipt of Payments. In the event the Assignor shall
receive Insurance Proceeds or Condemnation Proceeds from any Casualty or
Condemnation in excess of $500,000, or Indemnity Payments relating to any
circumstance or series of related circumstances in excess of $500,000, then such
Insurance Proceeds or Condemnation Proceeds or Indemnity Payments, as the case
may be, shall be deposited upon receipt thereof, to the Indemnity Account or
Loss Proceeds Account as provided for in the Credit Agreement. Any other
Proceeds received by the Assignor shall be held in trust by the Assignor for the
benefit of the Collateral Agent, and the Assignor shall turn over such Proceeds
to the Collateral Agent within one Business Day of receipt thereof.
3.10 Account Inspection. The Assignor will permit the
Collateral Agent or its agents to verify from time to time the balances of any
and all of the accounts of the Assignor (including, without limitation, the
Collateral Accounts).
ARTICLE IV
SPECIAL PROVISIONS CONCERNING TRADEMARKS
4.1 Additional Representations and Warranties. Annex D hereto
lists all Trademarks owned by the Assignor and all Trademark Licenses as of the
date hereof. No modifications are required to be made to render Annex D accurate
as of the date hereof other than modifications that do not constitute a Material
Adverse Effect. To the best of Assignor's knowledge, except as set forth in
Annex D, (i) each Trademark is valid, subsisting, unexpired, enforceable and has
not been abandoned; (ii) each application for the federal registration of a
Trademark (including, without limitation, any renewals thereof) has been duly
and properly filed; (iii) no holding, decision or judgment has been rendered by
any court agency, board or other governmental authority which would limit,
cancel or question the validity of any Trademark; (iv) no action or proceeding
is pending seeking to limit, cancel or question the validity of any Trademark;
and (v) no written claim has been made that the use of any Trademark does or may
violate the rights of any third person. The Assignor further represents and
warrants that upon the recordation in the United States Patent and Trademark
Office of an Assignment of Security
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Interest in United States Trademarks and Patents substantially in the form of
Annex G hereto, together with filings on Form UCC-1 pursuant to this Agreement,
all filings, registrations and recordings necessary or appropriate, to the
extent permitted by applicable law, to cause the security interest granted to
the Collateral Agent in the United States Trademarks covered by this Agreement
to be a perfected first-priority security interest under applicable law will
have been accomplished. The Assignor agrees to execute such Assignment of
Security Interest in United States Trademarks and Patents covering all right,
title and interest in each United States Trademark, and the associated goodwill,
of the Assignor, and to record the same. Without limitation on Section 1.2, the
Assignor hereby grants to the Collateral Agent an absolute power of attorney to
sign, upon the occurrence and during the continuance of an Event of Default, any
document which may be required by the U.S. Patent and Trademark Office or
secretary of state or equivalent governmental agency of any state of the United
States in order to effect an absolute assignment of all right, title and
interest in each Trademark, and record the same. Such power of attorney, coupled
with an interest shall be irrevocable.
4.2 Licenses and Assignments. The Assignor hereby agrees not
to divest itself of any right under a Trademark of the Assignor other than in
the ordinary course of business or to the extent permitted under Section 6.1 of
the Credit Agreement absent prior written approval of the Collateral Agent.
4.3 Infringements. The Assignor agrees, promptly upon learning
thereof, to notify the Collateral Agent in writing of the name and address of,
and to furnish such pertinent information that may be available with respect to,
any party who may be infringing or otherwise violating in any respect any of the
Assignor's rights in and to any Trademark of the Assignor, or with respect to
any party claiming that the Assignor's use of any Trademark of the Assignor
violates any right of that party, to the extent that such infringement or
violation is reasonably likely to have a Material Adverse Effect. The Assignor
further agrees, unless otherwise directed by the Collateral Agent, diligently to
prosecute any person infringing any Trademark of the Assignor at the expense of
the Assignor in accordance with reasonable business practices.
4.4 Preservation of Trademarks. The Assignor agrees to use its
Trademarks in interstate commerce during the time in which this Agreement is in
effect, sufficiently to preserve such Trademarks registered under the laws of
the United States; provided that, the Assignor shall not be obligated to
preserve any Trademark (a) to the extent the Assignor determines, in its
reasonable business judgment, that the preservation of such Trademark is no
longer desirable in the conduct of its business or (b) if any injunction,
restraining order or similar order is in effect which prevents the Assignor from
using any such Trademarks.
4.5 Maintenance of Registration. The Assignor shall, at its
own expense, diligently process all documents required by the Trademark Act of
1946, 15 U.S.C. Sections 1051 et seq., to maintain trademark registration to the
extent that the Assignor's failure to do so would be reasonably likely to have a
Material Adverse Effect, including but not limited to affidavits or declarations
of use and applications for renewals of registration in the United States Patent
and Trademark Office for all of its Trademarks pursuant to 15 U.S.C. Sections
1058(a), 1059 and 1065, and shall pay all fees and disbursements in connection
therewith, and shall not abandon any such
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filing of affidavit or declaration of use or any such application of renewal
prior to the exhaustion of all administrative and judicial remedies without
prior written consent of the Collateral Agent, and, upon the written request of
the Collateral Agent, shall provide the Collateral Agent with written
verification that such actions have been taken; provided that, the Assignor
shall not be obligated to preserve any Trademark to the extent the Assignor
determines, in its reasonable business judgment, that the preservation of such
Trademark is no longer desirable in the conduct of its business.
4.6 Remedies. If an Event of Default shall occur and be
continuing, the Collateral Agent may, by written notice to the Assignor, take
any or all of the following actions: (i) declare the entire right, title and
interest of the Assignor in and to each of the Trademarks, together with all
trademark rights and rights of protection to the same, vested, in which event
such rights, title and interest shall immediately vest in the Collateral Agent
for the benefit of the Secured Creditors and the Collateral Agent shall be
entitled to exercise the power of attorney referred to in Section 4.1 to
execute, cause to be acknowledged and notarized, and record said absolute
assignment with the applicable agency; (ii) take and use or sell the Trademarks
of the Assignor and the goodwill of the Assignor's business symbolized by the
Trademarks of the Assignor and the right to carry on the business and use the
assets of the Assignor in connection with which the Trademarks of the Assignor
have been used; and (iii) direct the Assignor to refrain, in which event the
Assignor shall refrain, from using the Trademarks of the Assignor in any manner
whatsoever, directly or indirectly, and, if requested by the Collateral Agent,
change the Assignor's corporate name to eliminate therefrom any use of any
Trademark of the Assignor and execute such other and further documents that the
Collateral Agent may request to further confirm this and to transfer ownership
of the Trademarks and registrations and any pending trademark application in the
United States Patent and Trademark Office to the Collateral Agent.
ARTICLE V
SPECIAL PROVISIONS CONCERNING TRADE SECRETS,
PATENTS AND COPYRIGHTS
5.1 Additional Representations and Warranties. Annex E hereto
lists all Patents owned by the Assignor as of the date hereof and any known
defects in title to such Patents. Annex F hereto lists all Copyrights owned by
the Assignor in its own name as of the date hereof. No modifications are
required to be made to render Annex E or Annex F accurate as of the date hereof
other than modifications that do not constitute a Material Adverse Effect. To
the best of the Assignor's knowledge, except as set forth in Annex E, (i) each
Patent and Copyright is valid, subsisting, unexpired, enforceable and has not
been abandoned; (ii) each application for a Patent or Copyright (including,
without limitation, any reissues, divisions, continuations, renewals, extensions
and continuations-in-part thereof) has been duly and properly filed; (iii)
except as set forth in Annex E or Annex F, no holding, decision or judgment has
been rendered by any court agency, board or other governmental authority which
would limit, cancel or question the validity of any Patent or Copyright; (iv) no
action or proceeding is pending seeking to limit, cancel or question the
validity of any Patent or Copyright; and (v) no written claim has been made that
the
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use of any Patent or Copyright does or may violate the rights of any third
person. The Assignor further represents and warrants that it is the true and
lawful owner of all rights in (i) all trade secrets and proprietary information
necessary to operate the business of the Assignor (the "Trade Secret Rights").
The Assignor further represents and warrants that, except as set forth in Annex
E, it has the exclusive right to use all Patents and Copyrights that it owns and
to the best knowledge of the Assignor has the exclusive right to exclude others
from using any Patents and Copyrights it owns. The Assignor agrees to execute an
Assignment of Security Interest in United States Trademarks and Patents
substantially in the form of Annex G hereto covering all right, title and
interest in each United States Patent of the Assignor and to record the same,
and to execute an Assignment of Security Interest in United States Copyrights
substantially in the form of Annex H hereto covering all right, title and
interest in each United States Copyright of the Assignor and to record the same.
The Assignor further represents and warrants that upon the recordation of each
of the Assignment of Security Interest in United States Trademarks and Patents
and the Assignment of Security Interest in United States Copyrights, together
with filings on Form UCC-1 pursuant to this Agreement, all filings,
registrations and recordings necessary or appropriate, to the extent permitted
by applicable law, to cause the security interest granted to the Collateral
Agent in the United States Patents and Copyrights covered by this Agreement to
be a perfected first priority security interest under applicable law will have
been accomplished. The Assignor hereby grants to the Collateral Agent an
absolute power of attorney to sign, upon the occurrence and during the
continuance of any Event of Default, any document which may be required by the
U.S. Patent and Trademark Office, the U.S. Copyright Office or secretary of
state or equivalent governmental agency of any state of the United States in
order to effect an absolute assignment of all right, title and interest in each
Patent and Copyright, and to record the same. Such power of attorney, coupled
with an interest, shall be irrevocable.
5.2 Licenses and Assignments. The Assignor hereby agrees not
to divest itself of any right under a Patent or Copyright other than in the
ordinary course of business or to the extent permitted under Section 6.1 of the
Credit Agreement absent prior written approval of the Collateral Agent.
5.3 Infringements. The Assignor agrees, promptly upon learning
thereof, to furnish the Collateral Agent in writing with all pertinent
information available to the Assignor with respect to any infringement or other
violation in any respect of the Assignor's rights in any significant Patent or
Copyright, or with respect to any claim that practice of any significant Patent
or Copyright of the Assignor violates any property right of a third party, to
the extent that such infringement or violation is reasonably likely to have a
Material Adverse Effect. The Assignor further agrees, absent direction of the
Collateral Agent to the contrary, diligently to prosecute any person infringing
any significant Patent or Copyright at the expense of the Assignor in accordance
with ordinary business practices to the extent that such infringement or
violation is reasonably likely to have a Material Adverse Effect.
5.4 Maintenance of Patents. At its own expense, the Assignor
shall make timely payment of all post-issuance fees required pursuant to 35
U.S.C. Section 41 to maintain in force rights under each of its Patents.
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5.5 Prosecution of Patent Application. At its own expense, the
Assignor shall diligently prosecute all applications for United States patents
listed under the Assignor's name on Annex E hereto, and shall not abandon any
such application prior to exhaustion of all commercially reasonable
administrative and judicial remedies, absent written consent of the Collateral
Agent; provided that, the Assignor shall not be obligated to preserve any
application to the extent the Assignor determines, in its reasonable business
judgment, that (a) the preservation of such application is no longer desirable
in the conduct of its business or (b) having regard to applicable legal and
ethical principles, that the prosecution or maintenance of an application should
not be pursued or continued.
5.6 Remedies. If an Event of Default shall occur and be
continuing, the Collateral Agent may by written notice to the Assignor take any
or all of the following actions: (i) declare the entire right, title and
interest of the Assignor in each of the Patents and Copyrights vested, in which
event such right, title and interest shall immediately vest in the Collateral
Agent for the benefit of the Secured Creditors, in which case the Collateral
Agent shall be entitled to exercise the power of attorney referred to in Section
5.1 to execute, cause to be acknowledged and notarized, and record said absolute
assignment with the applicable agency; (ii) take and practice or sell the
Patents and Copyrights of the Assignor; (iii) direct the Assignor to refrain, in
which event the Assignor shall refrain, from practicing the Patents and
Copyrights of the Assignor directly or indirectly, and the Assignor shall
execute such other and further documents as the Collateral Agent may request
further to confirm this and to transfer ownership of the Patents and Copyrights
of the Assignor to the Collateral Agent for the benefit of the Secured
Creditors.
ARTICLE VI
PROVISIONS CONCERNING ALL COLLATERAL
6.1 General Representations and Warranties. (i) The Assignor
has the full right, power and authority to enter into this Agreement and to
grant all of the right, title and interest herein granted by it; (ii) the
execution, delivery and performance by the Assignor of this Agreement do not and
will not contravene the Assignor's charter or by-laws or any contractual
restriction binding on or affecting the Assignor or any of its properties; (iii)
no consent of any third party is required in connection with the Assignor's
execution and delivery of this Agreement; (iv) this Agreement has been duly
executed and delivered by the Assignor and is a legal, valid and binding
obligation of the Assignor, enforceable against the Assignor in accordance with
its terms; and (v) all of the Assignor's representations and warranties in
Sections 4.1 and 5.1 are true and correct.
6.2 Protection of Collateral Agent's Security. The Assignor
will do nothing to impair the rights of the Collateral Agent in the Collateral.
The Assignor will at all times keep the insurable Collateral insured in favor of
the Collateral Agent, at its own expense, to the extent required by the Credit
Agreement against fire, theft and all other risks to which such Collateral may
be subject; all policies or certificates with respect to such insurance shall be
endorsed to the
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Collateral Agent's satisfaction for the benefit of the Collateral Agent
(including, without limitation, by naming the Collateral Agent as loss payee)
and deposited with the Collateral Agent. If the Assignor shall fail to insure
the Collateral to the extent required by the Credit Agreement, or if the
Assignor shall fail to so endorse and deposit all policies or certificates with
respect thereto, the Collateral Agent shall have the right (but shall be under
no obligation) to procure such insurance and the Assignor agrees to reimburse
the Collateral Agent for all reasonable costs and expenses of procuring such
insurance. Upon the occurrence and during the continuance of an Event of
Default, the Collateral Agent may apply any proceeds of such insurance required
to be maintained pursuant to this Section 6.1 in accordance with Section 7.4.
The Assignor assumes all liability and responsibility in connection with the
Collateral acquired by it and the liability of the Assignor to pay its
Obligations shall in no way be affected or diminished by reason of the fact that
such Collateral may be lost, destroyed, stolen, damaged or for any reason
whatsoever unavailable to the Assignor.
6.3 Further Actions. The Assignor will, at its own expense,
make, execute, endorse, acknowledge, file and/or deliver to the Collateral Agent
from time to time such lists, descriptions and designations of its Collateral,
including, without any limitation on the foregoing, any and all warehouse
receipts, receipts in the nature of warehouse receipts, bills of lading,
documents of title, vouchers, invoices, schedules, confirmatory assignments,
conveyances, transfer endorsements, powers of attorney, certificates, reports
and other assurances or instruments, and take such further steps relating to the
Collateral including, without limitation, all Acquired Collateral, and other
property or rights covered by the security interest hereby granted, which the
Collateral Agent deems reasonably appropriate or advisable to protect, perfect,
and preserve the priority of, its security interest in the Collateral.
6.4 Financing and Continuation Statements. Without limitation
on the foregoing, the Assignor agrees to sign and deliver to the Collateral
Agent such financing and continuation statements, in form acceptable to the
Collateral Agent, as the Collateral Agent may from time to time reasonably
request or as are reasonably necessary or desirable in the opinion of the
Collateral Agent to establish and maintain a valid, enforceable, perfected
security interest in the Collateral as provided herein and the other rights and
security contemplated hereby all in accordance with the Uniform Commercial Code
as enacted in any and all relevant jurisdictions or any other relevant law. The
Assignor will pay any applicable filing fees and related expenses. The Assignor
authorizes the Collateral Agent to file any such financing statements without
the signature of the Assignor.
ARTICLE VII
REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT
AND CERTAIN DEFAULTS
7.1 Remedies; Obtaining Collateral Upon Default. For the
purpose of enabling the Collateral Agent to exercise rights and remedies under
this Agreement, the Assignor agrees that if any Event of Default shall have
occurred and be continuing:
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(a) then and in every such case, subject to any mandatory
requirements of applicable law then in effect, the Collateral Agent, in addition
to any rights now or hereafter existing under applicable law, shall have all
rights as a secured creditor under the Uniform Commercial Code in all relevant
jurisdictions and may:
(i) personally, or by agents or attorneys, immediately retake
possession of the Collateral of the Assignor or any part thereof from
the Assignor or any other Person who then has possession of any part
thereof with or without notice or process of law:
(1) by directing the Assignor in writing to deliver the
same to the Collateral Agent at any place or places designated by
the Collateral Agent, in which event the Assignor shall at its own
expense:
(A) forthwith cause the same to be moved to the place
or places so designated by the Collateral Agent and there
delivered to the Collateral Agent,
(B) store and keep any Collateral of the Assignor so
delivered to the Collateral Agent at such place or places
pending further action by the Collateral Agent as provided in
Section 7.2, and
(C) while the Collateral of the Assignor shall be so
stored and kept, provide such guards and maintenance services
as shall be necessary to protect the same and to preserve and
maintain them in good condition; or
(2) by entering upon the Assignor's premises where any
of the Collateral is located and remove the same and use in
connection with such removal any and all services, supplies, aids
and other facilities of the Assignor;
(ii) withdraw all moneys, securities and other instruments in
the Cash Collateral Account for application to the Obligations in
accordance with Section 7.4 hereof;
(iii) sell, assign or otherwise liquidate, or direct the
Assignor to sell, assign or otherwise liquidate, any or all of the
Collateral of the Assignor or any part thereof in accordance with
Section 7.2 hereof, and take possession of the proceeds of any such
sale or liquidation;
(b) the Assignor hereby grants to the Collateral Agent an
irrevocable, non-exclusive license (exercisable without payment of
royalty or other compensation to the Assignor and subject only to the
rights of the third party licensors from whom the Assignor has licensed
copyrights, trademarks and patents that are incorporated in certain of
the Assignor's works) (i), to license or sublicense any part of the
Intellectual Property Collateral to any third party, or to grant to any
such third party any corresponding right of use, (ii) to use, disclose,
reproduce, prepare derivative works based upon, distribute, display
publicly or perform publicly, the Intellectual Property Collateral or
any part thereof, or (iii) to make, use or sell any inventions
contained, disclosed or described in the Intellectual Property
Collateral; in each case, without the prior written consent of the
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Assignor. The license granted herein includes the right of the
Collateral Agent, consistent with the Assignor's confidentiality
obligations to third parties, to have reasonable access to all media in
which, without limitation, any copyrightable work, software, mask work,
invention, process, art, method or trade secret underlying the
Intellectual Property Collateral may be recorded or stored and to all
equipment, computer software and documentation that is used for the
compilation or printout thereof or that is otherwise necessary in the
Collateral Agent's reasonable judgment for the Collateral Agent to
exercise its licensed rights hereunder;
(c) upon the request of the Collateral Agent, the Assignor
shall use its best efforts to obtain all requisite consents or
approvals by the licenser of each license or sublicense pursuant to
which Assignor receives rights with respect to any copyright, trademark
or patent owned by any third party that is used in connection with the
Intellectual Property Collateral to effect the assignment of all of the
Assignor's rights, title and interest thereunder to the Collateral
Agent or its designee;
it being understood that the Assignor's obligation so to deliver the Collateral
is of the essence of this Agreement and that, accordingly, upon application to a
court of equity having jurisdiction, the Collateral Agent shall be entitled to a
decree requiring specific performance by the Assignor of said obligation.
7.2 Remedies; Disposition of Collateral. Upon the occurrence
and during the continuance of an Event of Default, any Collateral repossessed by
the Collateral Agent under or pursuant to Section 7.1 and any other Collateral
whether or not so repossessed by the Collateral Agent, may be sold, assigned,
leased or otherwise disposed of under one or more contracts or as an entirety,
and without the necessity of gathering at the place of sale the property to be
sold, and in general in such manner, at such time or times, at such place or
places and on such terms as the Collateral Agent may, in compliance with any
mandatory requirements of applicable law, determine to be commercially
reasonable. Any of the Collateral may be sold, leased or otherwise disposed of
in the condition in which the same existed when taken by the Collateral Agent or
after any overhaul or repair which the Collateral Agent shall determine to be
commercially reasonable. Any such disposition which shall be a private sale or
other private proceedings permitted by such requirements shall be made upon not
less than ten (10) days' written notice to the Assignor specifying the time at
which such disposition is to be made and the intended sale price or other
consideration therefor, and shall be subject, for the ten (10) days after
receipt of such notice, to the right of the Assignor or any nominee of the
Assignor to acquire the Collateral involved at a price or for such other
consideration at least equal to the intended sale price or other consideration
so specified. Any such disposition which shall be a public sale permitted by
such requirements shall be made upon not less than ten (10) days' written notice
to the Assignor specifying the time and place of such sale and, in the absence
of applicable requirements of law, shall be by public auction (which may, at the
Collateral Agent's option, be subject to reserve), after publication of notice
of such auction not less than ten (10) days prior thereto in two newspapers in
general circulation in the City of New York. The Assignor agrees that the
notices provided for herein are commercially reasonable within the meaning of
the Uniform Commercial Code as in effect in any relevant jurisdiction. To the
extent permitted by any requirement of law,
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the Collateral Agent on behalf of the Secured Creditors (or certain of them) may
bid for and become the purchaser of the Collateral or any item thereof, offered
for sale in accordance with this Section 7.2 without accountability to the
Assignor (except to the extent of surplus money received as provided in Section
7.4). If, under mandatory requirements of applicable law, the Collateral Agent
shall be required to make disposition of the Collateral within a period of time
which does not permit the giving of notice to the Assignor as hereinabove
specified, the Collateral Agent need give the Assignor only such notice of
disposition as shall be reasonably practicable in view of such mandatory
requirements of applicable law. The Assignor agrees to do or cause to be done
all such other acts and things as may be reasonably necessary to make such sale
or sales of all or any portion of the Collateral of the Assignor valid and
binding and in compliance with any and all applicable laws, regulations, orders,
writs, injunctions, decrees or awards of any and all courts, arbitrations or
governmental instrumentalities, domestic or foreign, having jurisdiction over
any such sale or sales, all at the Assignor's expense.
7.3 Waiver of Claims. Except as otherwise provided in this
Agreement, THE ASSIGNOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE COLLATERAL AGENT'S
TAKING POSSESSION OR THE COLLATERAL AGENT'S DISPOSITION OF ANY OF THE COLLATERAL
OF SUCH ASSIGNOR, INCLUDING, WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND
HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH SUCH
ASSIGNOR WOULD OTHERWISE HAVE UNDER THE CONSTITUTION OR ANY STATUTE OF THE
UNITED STATES OR OF ANY STATE, and the Assignor hereby further waives, to the
extent permitted by law:
(i) all damages occasioned by such taking of possession,
except any damages which are the direct result of the Collateral
Agent's gross negligence or willful misconduct;
(ii) all other requirements as to the time, place and terms
of sale or other requirements with respect to the enforcement of the
Collateral Agent's rights hereunder; and
(iii) all rights of redemption, appraisement, valuation, stay,
extension or moratorium now or hereafter in force under any applicable
law in order to prevent or delay the enforcement of this Agreement or
the absolute sale of the Collateral or any portion thereof, and the
Assignor, for itself and all who may claim under it, insofar as it or
they now or hereafter lawfully may, hereby waives the benefit of all
such laws.
Any sale of, or the grant of options to purchase, or any other realization upon,
any Collateral shall operate to divest all right, title, interest, claim and
demand, either at law or in equity, of the Assignor therein and thereto, and
shall be a perpetual bar both at law and in equity against the Assignor and
against any and all Persons claiming or attempting to claim the Collateral so
sold, optioned or realized upon, or any part thereof, from, through and under
the Assignor.
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7.4 Application of Proceeds. (a) Except as otherwise set
forth in the Intercreditor Agreement with respect to Shared Collateral, the
proceeds of any Collateral obtained pursuant to Section 7.1 or disposed of
pursuant to Section 7.2 shall be applied as follows:
(i) first, to the payment of all Obligations to the
Collateral Agent of the type described in clauses (iii) and (iv) of the
definition of "Obligation" contained in Article IX hereof;
(ii) second, to the extent proceeds remain after the
application pursuant to preceding clause (i), an amount equal to the
outstanding Obligations to the Secured Creditors shall be paid to the
Secured Creditors as provided in Section 7.4(c) with each Secured
Creditor receiving an amount equal to its outstanding Obligations or,
if the proceeds are insufficient to pay in full all such Obligations,
its Pro Rata Share of the amount remaining to be distributed to be
applied, with respect to the Credit Agreement Obligations, firstly to
the payment of interest in respect of the unpaid principal amount of
Loans outstanding, secondly to the payment of principal of Loans
outstanding, then to the other Credit Agreement Obligations; and
(iii) third, to the extent remaining after the application
pursuant to the preceding clauses (i) and (ii) and following the
termination of this Agreement pursuant to Section 10.9 hereof, to the
Assignor or to whomever may be lawfully entitled to receive such
payment.
(b) For purposes of this Agreement, "Pro Rata Share" shall
mean, when calculating a Secured Creditor's portion of any distribution or
amount, the amount (expressed as a percentage) equal to a fraction the numerator
of which is the then outstanding amount of the relevant Obligations owed such
Secured Creditor and the denominator of which is the then outstanding amount of
all Obligations.
(c) All payments required to be made to (i) the Bank
Creditors hereunder shall be made to the Agent for the account of the respective
Bank Creditors and (ii) the Interest Rate Creditors hereunder shall be made to
the paying agent under the applicable Secured Interest Rate Agreement or, in the
case of Secured Interest Rate Agreements without a paying agent, directly to the
applicable Interest Rate Creditor.
(d) For purposes of applying payments received in accordance
with this Section 7.4, the Collateral Agent shall be entitled to rely upon (i)
the Agent for a determination (which the Agent agrees to provide upon request to
the Collateral Agent) of the outstanding Credit Agreement Obligations and (ii)
upon any Interest Rate Creditor for a determination (which each Interest Rate
Creditor agrees to provide upon request to the Collateral Agent) of the
outstanding Interest Rate Obligations owed to such Interest Rate Creditor.
Unless it has actual knowledge (including by way of written notice from a
Secured Creditor) to the contrary, the Agent under the Credit Agreement, in
furnishing information pursuant to the preceding sentence, and the Collateral
Agent, in acting hereunder, shall be entitled to assume that (x) no Credit
Agreement Obligations other than principal, interest and regularly accruing fees
are owing to any Bank
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Creditor and (y) no Secured Interest Rate Agreements or Interest Rate
Obligations with respect thereto are in existence.
(e) It is understood that the Assignor shall remain liable to
the extent of any deficiency between the amount of the proceeds of the
Collateral and the aggregate amount of the sums referred to in clauses (i) and
(ii) of Section 7.4(a) with respect to the Assignor.
7.5 Remedies Cumulative. Each and every right, power and
remedy hereby specifically given to the Collateral Agent shall be in addition to
every other right, power and remedy specifically given under any Secured
Interest Rate Agreement or the other Loan Documents or otherwise now or
hereafter existing at law or in equity, or by statute, and each and every right,
power and remedy whether specifically herein given or otherwise existing may be
exercised from time to time or simultaneously and as often and in such order as
may be deemed expedient by the Collateral Agent. All such rights, powers and
remedies shall be cumulative and the exercise or the beginning of exercise of
one shall not be deemed a waiver of the right to exercise of any other or
others. No delay or omission of the Collateral Agent in the exercise of any such
right, power or remedy and no renewal or extension of any of the Obligations
shall impair any such right, power or remedy or shall be construed to be a
waiver of any Default or Event of Default or an acquiescence therein. In the
event that the Collateral Agent shall bring any suit to enforce any of its
rights hereunder and shall be entitled to judgment, then in such suit the
Collateral Agent may recover reasonable expenses, including, without limitation,
reasonable attorneys' fees, and the amounts thereof shall be included in such
judgment.
7.6 Discontinuance of Proceedings. In case the Collateral
Agent shall have instituted any proceeding to enforce any right, power or remedy
under this Agreement by foreclosure, sale, entry or otherwise, and such
proceeding shall have been discontinued or abandoned for any reason or shall
have been determined adversely to the Collateral Agent, then and in every such
case the Assignor, the Collateral Agent and each holder of any of the
Obligations shall be restored to their former positions and rights hereunder
with respect to the Collateral subject to the security interest created under
this Agreement, and all rights, remedies and powers of the Collateral Agent
shall continue as if no such proceeding had been instituted.
ARTICLE VIII
INDEMNITY
8.1 Indemnity. (a) The Assignor agrees to indemnify, reimburse
and hold the Collateral Agent, each Secured Creditor and its respective
successors, assigns, employees, agents and servants (hereinafter in this Section
8.1 referred to individually as "Indemnitee," and collectively as "Indemnitees")
harmless from any and all liabilities, obligations, losses, damages, penalties,
claims, demands, actions, suits, judgments and any and all costs and expenses
(including reasonable attorneys' fees and expenses) (for the purposes of this
Section 8.1 the foregoing are collectively called "Expenses") of whatsoever kind
and nature imposed on, asserted against or incurred by any of the Indemnitees in
any way relating to or arising out of this Agreement, or in any other way
connected with the enforcement of any of the terms of, or the
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preservation of any rights hereunder, or in any way relating to or arising out
of the manufacture, ownership, ordering, purchase, delivery, control,
acceptance, lease, financing, possession, operation, condition, sale, return or
other disposition, or use of the Collateral (including, without limitation,
latent or other defects, whether or not discoverable), the violation of the laws
of any country, state or other governmental body or unit, any tort (including,
without limitation, claims arising or imposed under the doctrine of strict
liability, or for or on account of injury to or the death of any Person
(including any Indemnitee), or property damage), or contract claim; provided
that no Indemnitee shall be indemnified pursuant to this Section 8.1(a) for
losses, damages or liabilities to the extent caused by the gross negligence or
willful misconduct of such Indemnitee. The Assignor agrees that upon written
notice by any Indemnitee of the assertion of such a liability, obligation, loss,
damage, penalty, claim, demand, action, judgment or suit, the Assignor shall
assume full responsibility for the defense thereof. Each Indemnitee agrees to
use its best efforts to promptly notify the Assignor of any such assertion of
which such Indemnitee has knowledge.
(b) Without limiting the application of Section 8.1(a), the
Assignor agrees to pay, or reimburse the Collateral Agent for (if the Collateral
Agent shall have incurred fees, costs or expenses because the Assignor shall
have failed to comply with its obligations under this Agreement or any Credit
Document), any and all reasonable fees, costs and expenses of whatever kind or
nature incurred in connection with the creation, preservation, protection and
enforcement of the Collateral Agent's security interest in the Collateral,
including, without limitation, all reasonable fees and taxes in connection with
the recording or filing of instruments and documents in public offices, payment
or discharge of any taxes or Liens upon or in respect of the Collateral,
premiums for insurance with respect to the Collateral and all other reasonable
fees, costs and expenses in connection with protecting, maintaining or
preserving the Collateral and the Collateral Agent's interest therein, whether
through judicial proceedings or otherwise, or in defending or prosecuting any
actions, suits or proceedings arising out of or relating to the Collateral.
(c) If and to the extent that the obligations of the Assignor
under this Section 8.1 are unenforceable for any reason, the Assignor hereby
agrees to make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law.
8.2 Indemnity Obligations Secured by Collateral; Survival. Any
amounts paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral. The
indemnity obligations of the Assignor contained in this Article VIII shall
continue in full force and effect notwithstanding the full payment of all the
Notes issued under the Credit Agreement and all of the other Obligations and
notwithstanding the discharge thereof.
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ARTICLE IX
DEFINITIONS
The following terms shall have the meanings herein specified
unless the context otherwise requires. Such definitions shall be equally
applicable to the singular and plural forms of the terms defined.
"Accounts" means any "account," as such term is defined in
Section 9-106 of the UCC, now owned or hereafter acquired by the Assignor or in
which the Assignor now has or hereafter acquires any rights, and, in any event,
shall include, without limitation, all book debts and other forms of obligations
(other than forms of obligations evidenced by Chattel Paper, Documents or
Instruments) now owned or hereafter received or acquired by or belonging or
owing to the Assignor arising out of services rendered by the Assignor, whether
or not the same have been earned, and all of the Assignor's rights in, to and
under all purchase orders or receipts now owned or hereafter acquired by it in
connection with any performance or anticipated performance of services, and all
moneys due or to become due to the Assignor under all contracts for the
performance of services by the Assignor (whether or not yet earned by
performance on the part of the Assignor or in connection with any other
transaction), now in existence or hereafter occurring, including, without
limitation, the right to receive the Proceeds of said purchase orders and
contracts, and all collateral security and guarantees of any kind given by any
Person with respect to any of the foregoing.
"Acquire" means, with respect to the Assignor, to become the
owner of any Collateral not owned by Assignor as of the date hereof, whether
such ownership comes by means of: (i) the purchase, assignment or other transfer
of ownership right, title and interest from a third party or (ii) Assignor's
creation, use, invention, discovery or other development of proprietary rights
included in the Intellectual Property Collateral. "Acquisition" and "Acquired"
have corollary meanings.
"Assignor" shall have the meaning specified in the first
paragraph of this Agreement.
"Bank Creditor" shall have the meaning provided in the first
WHEREAS clause of this Agreement.
"Bank Collateral" means the BTCC Credit Agreement Collateral,
as such term is defined in the Intercreditor Agreement.
"Cash Collateral Account" shall mean a non-interest bearing
cash collateral account maintained with, and in the sole dominion and control
of, the Collateral Agent for the benefit of the Secured Creditors.
"Casualty" shall have the meaning provided for such term in
the Credit Agreement.
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"Chattel Paper" means any "chattel paper," as such term is
defined in Section 9-105 (1) (b) of the UCC, now owned or hereafter acquired by
the Assignor or in which the Assignor now has or hereafter acquires any rights
and wherever located.
"Class" shall have the meaning provided in Section 10.2(a).
"Closing Date" shall have the meaning provided to such term in
the Credit Agreement.
"Collateral" means all of the assets, whether now existing or
hereafter from time to time acquired, by the Assignor or any of its present or
future Subsidiaries, including, without limitation, any and all real property
and leasehold interest in real property now or hereafter owned by the Assignor
or its Subsidiaries, all Equipment, Shared Collateral, Collateral Accounts and
all monies, securities and instruments deposited or required to be deposited in
such Collateral Accounts, Cash Collateral Account and all monies, securities and
instruments deposited or required to be deposited in such Cash Collateral
Account, Copyrights (including all reissues and renewals thereof), Patents
(including all reissues and renewals thereof), Trademarks, Trade Secrets, Trade
Secret Rights, Contracts, Contract Rights, General Intangibles, Goods, Chattel
Paper, Instruments, Documents, and all Proceeds and products of any and all of
the foregoing; provided, that, without limitation on any of the foregoing, the
term Collateral shall not include the Bank Collateral.
"Collateral Accounts" means the Indemnity Account and the Loss
Proceeds Account now existing or hereafter established pursuant to the Credit
Agreement.
"Collateral Agent" shall have the meaning specified in the
first paragraph of this Agreement.
"Condemnation" shall have the meaning provided to such term in
the Credit Agreement.
"Contract Rights" shall mean all rights of an Assignor
(including, without limitation, all rights to payment) under each Contract.
"Contracts" means all contracts, undertakings, or other
agreements (but only to the extent that any or all of the foregoing constitute
all or a part of the Collateral, and other than rights evidenced by Chattel
Paper, Documents or Instruments) in or under which the Assignor may now or
hereafter have any right, title or interest and wherever located, including,
without limitation, (a) with respect to an Account, any agreement relating to
the terms of payment or the terms of performance thereof and (b) all interest
rate or currency exchange agreements, including, without limitation, cap,
collar, floor, forward or similar agreements, other rate or currency protection
arrangements or other rate or currency management arrangements.
"Copyrights" means copyrights and copyrightable works
(including, without limitation, rights to computer software) of the Assignor in
any jurisdiction along with any and all (i) registrations and applications for
registration of copyrights, (ii) income, royalties, damages
25
21
and payments now or hereafter due and/or payable to Assignor with respect
thereto, including, without limitation, damages and payments for past or future
infringements or misappropriation thereof, and (iii) rights to xxx for past,
present and future infringements or misappropriation thereof.
"Credit Agreement" shall have the meaning provided in the
first WHEREAS clause of this Agreement.
"Credit Agreement Obligations" shall have the meaning provided
in the definition of "Obligations" in this Article IX.
"Documents" means any "documents," as such term is defined in
Section 9-105 (1) (f) of the UCC, now owned or hereafter acquired by the
Assignor or in which the Assignor now has or hereafter acquires any rights and
wherever located.
"Equipment" means any "equipment," as such term is defined in
Section 9-109 (2) of the UCC, now owned or hereafter acquired by the Assignor or
in which the Assignor now has or hereafter acquires any rights and wherever
located, and, in any event, shall include, without limitation, all machinery,
equipment, furnishings, fixtures, vehicles and computers and other electronic
data-processing and other office equipment now owned or hereafter acquired by
the Assignor or in which the Assignor now has or hereafter acquires any rights
and wherever located, and any and all additions, substitutions and replacements
of any of the foregoing, wherever located, together with all attachments,
components, parts, equipment and accessories installed thereon or affixed
thereto.
"Event of Default" shall have the meaning provided for such
term in the Credit Agreement.
"Existing Credit Agreement" means the Credit Agreement, dated
as of January 12, 1996 among Anchor Glass, Foothill Capital Corporation and
Congress Financial Corporation, as amended, modified or supplemented to and
including the Closing Date.
"General Intangibles" means any "general intangibles" as such
term is defined in Section 9-106 of the UCC, now owned or hereafter acquired by
the Assignor or in which the Assignor now has or hereafter acquires any rights
and wherever located.
"Goods" means any "goods" as such term is defined in Section
9-105 (1) (h) of the UCC now owned or hereafter acquired by the Assignor or in
which the Assignor now has or hereafter acquires any rights and wherever
located.
"Indemnitee" shall have the meaning provided in Section 8.1.
"Indemnity Payments" shall have the meaning provided to such
term in the Credit Agreement.
26
22
"Instrument" means any "instrument," as such term is defined
in Section 9-105 (1) (i) of the UCC, now owned or hereafter acquired by the
Assignor or in which the Assignor now has or hereafter acquires any rights and
wherever located, other than instruments that constitute, or are a part of a
group of writings that constitute, Chattel Paper.
"Intellectual Property Collateral" means the Copyrights,
Patents, Trademarks, Trade Secrets, Trade Secret Rights and Trademark Licenses.
"Interest Rate Agreements" shall have the meaning provided in
the second WHEREAS clause of this Agreement.
"Interest Rate Creditors" shall have the meaning provided in
the second WHEREAS clause of this Agreement.
"Interest Rate Obligations" shall have the meaning provided in
the definition of "Obligations" in this Article IX.
"Liens" shall mean any security interest, mortgage, pledge,
lien, claim, charge, encumbrance, title retention agreement, lessor's interest
in a financing lease or analogous instrument, in, of, or on the Assignor's
property.
"Loan Documents" means this Agreement, all other Security
Documents, the Credit Agreement, the Bridge Notes, the Term Notes, the
Guarantees, the Intercreditor Agreement, the Term Exchange Notes, the
Registration Rights Agreement, the Warrant Agreement, the Warrants, the
Affiliate Transactions Agreement, the Holding Agreement and the OI Assurance
Agreement, all as the foregoing are defined in the Credit Agreement.
"Loans" shall mean the Bridge Loan and Term Loan as those
terms are described in the Credit Agreement.
"Material Adverse Effect" means a material adverse effect upon
(i) the business, operations, properties, assets, financial condition or
prospects of the Assignor and its Subsidiaries taken as a whole, (ii) the value
of the Collateral or the amount which the Collateral Agent and the Secured
Parties would be likely to receive (after giving consideration to delays in
payment and costs of enforcement) in liquidation of the Collateral, or (iii) the
ability of the Assignor to execute, deliver or perform its obligations under any
Transaction Document or (iv) the material rights and remedies of the Collateral
Agent and the Secured Parties under any Loan Document.
"Obligations" shall mean (i) the full and prompt payment when
due (whether at stated maturity, by acceleration or otherwise) of all
obligations and liabilities of the Assignor, now existing or hereafter incurred
under, arising out of or in connection with any Loan Document to which it is a
party and the due performance and compliance by the Assignor with the terms of
each of the Loan Documents (all such obligations and liabilities under this
clause (i), except to the extent consisting of obligations or indebtedness with
respect to Interest Rate Agreements, being herein collectively called the
"Credit Agreement Obligations"); (ii) the full
27
23
and prompt payment when due (whether at the stated maturity, by acceleration or
otherwise) of all obligations and liabilities of the Assignor, now existing or
hereafter incurred under, arising out of or in connection with any Interest Rate
Agreement (all such obligations and indebtedness under this clause (ii) being
herein collectively called the "Interest Rate Obligations"); (iii) any and all
sums advanced by the Collateral Agent in order to preserve the Collateral or
preserve its security interest in the Collateral; (iv) in the event of any
proceeding for the collection or enforcement of any indebtedness, obligations,
or liabilities of the Assignor referred to in clauses (i) and (ii), after an
Event of Default shall have occurred and be continuing, the reasonable expenses
of re-taking, holding, preparing for sale or lease, selling or otherwise
disposing of or realizing on the Collateral, or of any exercise by the
Collateral Agent of its rights hereunder, together with reasonable attorneys'
fees and court costs; and (v) all amounts paid by any Indemnitee as to which
such Indemnitee has the right to reimbursement under Section 8.1 of this
Agreement.
"Patents" means patents and patent applications of the
Assignor in any jurisdiction along with any and all (i) inventions and
improvements described and claimed therein, (ii) reissues, divisions,
continuations, renewals, extensions and continuations-in-part thereof, (iii)
income, royalties, damages and payments now or hereafter due and/or payable to
Assignor with respect thereto, including, without limitation, damages and
payments for past or future infringements or misappropriation thereof, and (iv)
rights to xxx for past, present and future infringements or misappropriation
thereof.
"Proceeds" shall have the meaning assigned that term under the
UCC or under other relevant law and, in any event, shall include, but not be
limited to, (i) any and all proceeds of any insurance, indemnity, warranty or
guaranty payable to the Collateral Agent or the Assignor from time to time with
respect to any of the Collateral, (ii) any and all payments (in any form
whatsoever) made or due and payable to the Assignor from time to time in
connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any part of the Collateral by any governmental authority
(or any person acting under color of governmental authority) and (iii) any and
all other amounts from time to time paid or payable under or in connection with
any of the Collateral.
"Requisite Creditors" shall have the meaning provided in
Section 10.2(a).
"Secured Creditors" shall have the meaning provided in the
second WHEREAS clause of this Agreement.
"Secured Interest Rate Agreement" shall have the meaning
provided in the second WHEREAS clause of this Agreement.
"Total Commitments" means the aggregate of the Bridge Loan
Commitment and Term Loan Commitment.
"Trademark Licenses" means any agreement, written or oral,
providing for the grant by Assignor of any right to use any Trademark, including
without limitation, any Trademark referred to in Annex D hereto but excluding
those agreements that are granted by the
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24
Assignor in the ordinary course of its business, the terms of which were not the
subject of extensive negotiation.
"Trademarks" means trademarks (including service marks, brand
names, certification marks, collective marks, trade dress and trade names,
whether registered or at common law) of the Assignor in any jurisdiction,
registrations and applications in any jurisdiction therefor, the goodwill of
Assignor's business connected therewith and symbolized thereby, along with any
and all, (i) renewals thereof, (ii) income, royalties, damages and payments now
or hereafter due or payable or both with respect thereto, including, without
limitation, damages and payments for past or future infringements or
misappropriations thereof, and (iii) rights to xxx for past, present and future
infringements or misappropriations thereof.
"Trade Secrets" means all of Assignor's right, title and
interest, in any jurisdiction, in and to all proprietary information of
Assignor, whether now owned or hereafter possessed, that Assignor protects as a
trade secret.
"Trade Secret Rights" shall have the meaning provided in
Section 5.1.
"Transaction Documents" means the Loan Documents, the
Acquisition Documents, the Senior Bank Revolving Credit Facility, the Affiliate
Transactions Agreement and any other documents or instruments delivered by the
Assignor or any of its Subsidiaries in connection with any of the foregoing or
the Transactions, all as the foregoing are defined in the Credit Agreement.
"UCC" means the Uniform Commercial Code as in effect on the
date hereof in the State of New York or, if another jurisdiction is specified
herein, the Uniform Commercial Code as in effect from time to time in such
jurisdiction.
ARTICLE X
MISCELLANEOUS
10.1 Notices. Except as otherwise specified herein, all
notices, requests, demands or other communications to or upon the respective
parties hereto shall be deemed to have been duly given or made when delivered to
the party to which such notice, request, demand or other communication is
required or permitted to be given or made under this Agreement, addressed to
such party at its address set forth opposite its signature below, or at such
other address as any of the parties hereto may hereafter notify the others in
writing.
10.2 Waiver; Amendment. (a) None of the terms and conditions
of this Agreement may be changed, waived, modified or varied in any manner
whatsoever unless in writing duly signed by the Assignor and the Collateral
Agent (with the consent of the Required Lenders or, to the extent required by
Section 10.6 of the Credit Agreement, all of the Lenders); provided, however,
that no such change, waiver, modification or variance shall be made to Section
7.4 hereof or this Section 10.2(a) without the consent of each Secured Creditor
adversely
29
25
affected thereby; provided further that any change, waiver, modification or
variance affecting the rights and benefits of a single Class of Secured
Creditors (and not all Secured Creditors in a like or similar manner) shall
require the written consent of the Requisite Creditors of such Class of Secured
Creditors. For the purpose of this Agreement, the term "Class" shall mean each
class of Secured Creditors, i.e., whether (x) the Bank Creditors as holders of
the Credit Agreement Obligations or (y) the Interest Rate Creditors as holders
of the Interest Rate Obligations. For the purpose of this Agreement, the term
"Requisite Creditors" of any Class shall mean each of (x) with respect to the
Credit Agreement Obligations, the Required Lenders and (y) with respect to the
Interest Rate Obligations, the holders of 51% of all obligations outstanding
from time to time under the Secured Interest Rate Agreements.
(b) No notice to or demand on the Assignor in any case shall
entitle it to any other or further notice or demand in similar or other
circumstances or constitute a waiver of any of the rights of the Collateral
Agent to any other or further action in any circumstances without notice or
demand.
10.3 Obligations Absolute. The obligations of the Assignor
hereunder shall remain in full force and effect without regard to, and shall not
be impaired by, (a) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of the Assignor; (b) any
exercise or non-exercise, or any waiver of, any right, remedy, power or
privilege under or in respect of this Agreement or any other Loan Document or
any Secured Interest Rate Agreement except as specifically set forth in a waiver
granted pursuant to the restrictions of Section 10.2 hereof; or (c) any
amendment to or modification of any Loan Document or any Secured Interest Rate
Agreement or any security for any of the Obligations; whether or not the
Assignor shall have notice or knowledge of any of the foregoing. The rights and
remedies of the Collateral Agent herein provided are cumulative and not
exclusive of any rights or remedies which the Collateral Agent would otherwise
have.
10.4 Successors and Assigns. This Agreement shall be binding
upon the Assignor and its successors and assigns and shall inure to the benefit
of the Collateral Agent and its successors and assigns, provided that the
Assignor may not transfer or assign any or all of its rights or obligations
hereunder without the written consent of the Collateral Agent. All agreements,
statements, representations and warranties made by the Assignor herein or in any
certificate or other instrument delivered by the Assignor or on its behalf under
this Agreement shall be considered to have been relied upon by the Secured
Creditors and shall survive the execution and delivery of this Agreement and the
other Loan Documents regardless of any investigation made by the Collateral
Agent.
10.5 Headings Descriptive. The headings of the several
sections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.
10.6 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any
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26
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
10.7 WAIVER OF JURY TRIAL; CONSENT TO JURISDICTION. (a) TO THE
MAXIMUM EXTENT PERMITTED UNDER APPLICABLE LAW, THE ASSIGNOR AND THE COLLATERAL
AGENT HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY AGREE TO WAIVE THEIR
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT, ANY OTHER LOAN DOCUMENT, OR ANY DEALINGS,
CONDUCT, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS BY EITHER OF THEM
RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE RELATIONSHIP BETWEEN
THEM. THE SCOPE OF THIS WAIVER IS INTENDED TO ENCOMPASS ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS
TRANSACTION, INCLUDING WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH
OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. THE ASSIGNOR AND
THE COLLATERAL AGENT EACH ACKNOWLEDGE THAT THIS WAIVER IS A MATERIAL INDUCEMENT
TO ENTER INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER
IN THEIR RELATED FUTURE DEALINGS. THE ASSIGNOR AND THE COLLATERAL AGENT FURTHER
WARRANT AND REPRESENT THAT EACH OF THEM HAS REVIEWED THIS WAIVER WITH ITS LEGAL
COUNSEL, AND THAT EACH OF THEM KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL
RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE,
MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
TO THIS AGREEMENT, OR ANY OTHER LOAN DOCUMENTS OR AGREEMENTS RELATING TO THIS
AGREEMENT. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
(b) THE ASSIGNOR AND THE COLLATERAL AGENT HERETO CONSENT FOR
THEMSELVES AND IN RESPECT OF THEIR PROPERTIES, GENERALLY, UNCONDITIONALLY AND
IRREVOCABLY, TO THE NONEXCLUSIVE JURISDICTION OF THE FEDERAL AND STATE COURTS IN
THE STATE OF NEW YORK WITH RESPECT TO ANY PROCEEDING RELATING TO ANY MATTER,
CLAIM OR DISPUTE ARISING UNDER THIS AGREEMENT, THE LOAN DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. BORROWER FURTHER CONSENTS,
GENERALLY, UNCONDITIONALLY AND IRREVOCABLY, TO THE NONEXCLUSIVE JURISDICTION OF
THE STATE AND FEDERAL COURTS OF THE STATE IN WHICH ANY OF THE COLLATERAL IS
LOCATED IN RESPECT OF ANY PROCEEDING RELATING TO ANY MATTER, CLAIM OR DISPUTE
ARISING WITH RESPECT TO SUCH COLLATERAL. ASSIGNOR FURTHER IRREVOCABLY
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27
CONSENTS TO THE SERVICE OF PROCESS, GENERALLY, UNCONDITIONALLY AND IRREVOCABLY,
AT THE ADDRESSES SET FORTH HEREIN IN CONNECTION WITH ANY OF THE AFORESAID
PROCEEDINGS IN ACCORDANCE WITH THE RULES APPLICABLE TO SUCH PROCEEDINGS. TO THE
EXTENT PERMITTED BY APPLICABLE LAW, ASSIGNOR HEREBY IRREVOCABLY WAIVES ANY
OBJECTION WHICH IT MAY NOW HAVE OR HAVE IN THE FUTURE TO THE LAYING OF VENUE IN
RESPECT OF ANY OF THE AFORESAID PROCEEDINGS BROUGHT IN THE COURTS REFERRED TO
ABOVE AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE COLLATERAL AGENT TO SERVE PROCESS
IN ANY MANNER PERMITTED BY LAW OR TO COMMENCE PROCEEDINGS OR OTHERWISE PROCEED
AGAINST BORROWER IN ANY JURISDICTION.
10.8 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
10.9 Assignor's Duties. It is expressly agreed, anything
herein contained to the contrary notwithstanding, that the Assignor shall remain
liable to perform all of the obligations, if any, assumed by it with respect to
the Collateral and the Collateral Agent shall not have any obligations or
liabilities with respect to any Collateral by reason of or arising out of this
Agreement, nor shall the Collateral Agent be required or obligated in any manner
to perform or fulfill any of the obligations of the Assignor under or with
respect to any Collateral.
10.10 Termination; Release. (a) After the termination of the
Total Commitments, or at such time as no Note is outstanding and all Loans and
other Obligations have been paid in full, this Agreement shall terminate, and
the Collateral Agent, at the request and expense of the Assignor, will execute
and deliver to the Assignor a proper instrument or instruments (including
Uniform Commercial Code termination statements on form UCC-3) acknowledging the
satisfaction and termination of this Agreement, and will duly assign, transfer
and deliver to the Assignor (without recourse and without any representation or
warranty) such of the Collateral as may be in the possession of the Collateral
Agent and as has not theretofore been sold or otherwise applied or released
pursuant to this Agreement.
(b) So long as no payment default on any of the Obligations is
in existence or would exist after the application of proceeds as provided below,
the Collateral Agent shall, at the request of the Assignor, release any or all
of the Collateral, provided that (x) such release is permitted by the terms of
the Credit Agreement or otherwise has been approved in writing by the Required
Lenders and (y) the proceeds of such Collateral are applied as required pursuant
to the Credit Agreement or any consent or waiver with respect thereto.
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28
(c) At any time that the Assignor desires that the Collateral
Agent take any action to give effect to any release of Collateral pursuant to
the foregoing Section 10.10(a) or (b), it shall deliver to the Collateral Agent
a certificate signed by an authorized officer stating that the release of the
respective Collateral is permitted pursuant to Section 10.10(a) or (b). In the
event that any part of the Collateral is released as provided in the preceding
paragraph (b), the Collateral Agent, at the request and expense of the Assignor,
will duly assign, transfer and deliver to the Assignor or its designee (without
recourse and without any representation or warranty) such of the Collateral as
is then being (or has been) so sold and as may be in the possession of the
Collateral Agent and has not theretofore been released pursuant to this
Agreement. The Collateral Agent shall have no liability whatsoever to any
Secured Creditor as the result of any release of Collateral by it as permitted
by this Section 10.10. Upon any release of Collateral pursuant to Section
10.10(a) or (b), none of the Secured Creditors shall have any continuing right
or interest in such Collateral, or the proceeds thereof.
10.11 Collateral Agent. By accepting the benefits of this
Agreement, each Secured Creditor acknowledges and agrees that the rights and
obligations of the Collateral Agent shall be as set forth in Section 8 of the
Credit Agreement. Notwithstanding anything to the contrary contained in Section
10.2 of this Agreement or Section 10.6 of the Credit Agreement, Section 10.10,
and the duties and obligations of the Collateral Agent set forth in Section
10.10, may not be amended or modified without the consent of the Agent.
* * *
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29
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered by their duly authorized officers as of
the date first above written.
One Anchor Plaza ANCHOR GLASS ACQUISITION
0000 Xxxxxx Xxxxx Xxxxxxx CORPORATION, as Assignor
Xxxxx, Xxxxxxx 00000-0000
Attention: Xxxx X. Ghaznaui
Tel: (000) 000-0000
Fax: (000) 000-0000 By /s/ Xxxx X. Xxxxxxxx
------------------------------
with a copy to: X. Xxxx May Name: Xxxx X. Xxxxxxxx
Xxxxxx Xxxxxxx Title: Chief Executive Officer
Xxxxxx & Xxxxxxx
Fax: 000 Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxxx,XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
000 Xxxxxxx Xxxxxx BANKERS TRUST COMPANY,
Xxx Xxxx, Xxx Xxxx 00000 as Collateral Agent
Attention: Xxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000 By /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
34
ANNEX A
To
Security Agreement
------------------
LOCATION OF CHIEF EXECUTIVE OFFICE; RECORD LOCATIONS
----------------------------------------------------
35
ANNEX B
To
Security Agreement
------------------
SCHEDULE OF EQUIPMENT LOCATIONS
-------------------------------
Location Equipment
-------- ---------
36
ANNEX C
To
Security Agreement
------------------
SCHEDULE OF TRADE AND FICTITIOUS NAMES
--------------------------------------
Name Jurisdiction Where Used
---- -----------------------
37
ANNEX D
To
Security Agreement
------------------
SCHEDULE OF TRADEMARKS
----------------------
Expiration
Trademark Name Number Type Date
-------------- ------ ---- ----------
38
ANNEX E
To
Security Agreement
------------------
SCHEDULE OF PATENTS AND APPLICATIONS
------------------------------------
U.S.
Patent No. Description Expiration
---------- ----------- ----------
39
ANNEX F
To
Security Agreement
------------------
SCHEDULE OF COPYRIGHTS AND APPLICATIONS
---------------------------------------
U.S. Copyright
Number Description Expiration
-------------- ----------- ----------
40
ANNEX G
to
SECURITY AGREEMENT
------------------
ASSIGNMENT OF SECURITY INTEREST
IN UNITED STATES TRADEMARKS AND PATENTS
---------------------------------------
FOR GOOD AND VALUABLE CONSIDERATION, receipt and sufficiency of which
are hereby acknowledged, ANCHOR GLASS ACQUISITION CORPORATION, a Delaware
corporation (the "Assignor") with principal offices at One Anchor Plaza, 0000
Xxxxxx Xxxxx Xxxxxxx, Xxxxx, Xxxxxxx 00000-0000 hereby assigns and grants to
BANKERS TRUST COMPANY, as Collateral Agent, with principal offices at 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Assignee"), a security interest
in (i) all of the Assignor's right, title and interest in and to the United
States trademarks, trademark registrations and trademark applications (the
"Trademarks") set forth on Schedule A attached hereto, (ii) all of the
Assignor's rights, title and interest in and to the United States patents and
pending patent applications (the "Patents") set forth on Schedule B attached
hereto, in each case together with (iii) all Proceeds (as such term is defined
in the Security Agreement referred to below) and products of the Trademarks and
Patents, (iv) the goodwill of the businesses with which the Trademarks are
associated and (v) all causes of action arising prior to or after the date
hereof for infringement of any of the Trademarks and Patents or unfair
competition regarding the same.
THIS ASSIGNMENT OF SECURITY INTEREST is made to secure the satisfactory
performance and payment of all the Obligations of the Assignor, as such term is
defined in the Security Agreement between the Assignor and the Assignee, dated
as of February 5, 1997 (as amended from time to time, the "Security Agreement").
After the termination of the
41
ANNEX G
Page 2
Total Commitments, no Note is outstanding and all Loans and other Obligations
have been paid in full, the Assignee shall, upon such satisfaction, execute,
acknowledge, and deliver to the Assignor an instrument in writing releasing the
security interest in the Trademarks and Patents acquired under this Assignment
of Security Interest.
This Assignment of Security Interest has been granted in conjunction
with the security interest granted to the Assignee under the Security Agreement.
The rights and remedies of the Assignee with respect to the security interest
granted herein are without prejudice to, and are in addition to those set forth
in the Security Agreement, all terms and provisions of which are incorporated
herein by reference. In the event that any provisions of this Assignment of
Security Interest are deemed to conflict with the Security Agreement, the
provisions of the Security Agreement shall govern.
IN WITNESS WHEREOF, the undersigned have executed this Assignment of
Security Interest as of the ____ day of ________, _____.
ANCHOR GLASS ACQUISITION
CORPORATION, Assignor
By________________________
Name:
Title:
BANKERS TRUST COMPANY,
as Collateral Agent, Assignee
By_______________________
Name:
Title:
00
XXXXX XX XXX XXXX )
) ss.:
COUNTY OF NEW YORK )
On this ____ day of _________, ____, before me personally came
_________________________ who, being by me duly sworn, did state as follows:
that [s]he is ________________ of ANCHOR GLASS ACQUISITION CORPORATION, that
[s]he is authorized to execute the foregoing Assignment of Security Interest on
behalf of said corporation and that [s]he did so by authority of the Board of
Directors of said corporation.
____________________
Notary Public
00
XXXXX XX XXX XXXX )
) ss.:
COUNTY OF NEW YORK )
On this ____ day of _________, ____, before me personally came
_________________________ who, being by me duly sworn, did state as follows:
that [s]he is ________________ of BANKERS TRUST COMPANY, that [s]he is
authorized to execute the foregoing Assignment of Security Interest on behalf of
said company and that [s]he did so by authority of the Board of Directors of
said corporation.
______________________
Notary Public
44
SCHEDULE A
TRADEMARK REG. NO. REG. DATE
--------- -------- ---------
STELLAR 1,953,772 January 30, 1996
Cornucopia Design 1,265,032 January 24,1984
GOLDEN HARVEST 1,300,589 October 16, 1984
and Cornucopia Design
Anchor Design 1,320,769 February 19, 1985
LINELIGHTS 1,929,484 October 24, 1995
TRADEMARK SERIAL NO. REG. DATE
--------- ---------- ---------
LASTING IMPRESSIONS 75/037,768 December 27, 1995
SPLASH 75/088,093 April 15, 1996
COUNTRY WICKS (not available) December 31, 1996
45
SCHEDULE B
PATENT PATENT NO. ISSUE DATE
------ ---------- ----------
Box Separator 4,144,995 March 20, 1979
Electronic Apparatus and Method for Control of Container 4,149,621 April 17, 1979
Orienting Machinery
Thermoplastic Ink Decorated Polymer Coated Glass Articles 4,265,947 May 5, 1981
Liquid Flask Orienter 4,308,943 January 5, 1982
Container Masking and Coating Apparatus 4,319,543 March 16, 1982
Fuse Assembly 4,467,308 August 21, 1984
Corrosion/Wear-Resistant Metal Alloy Coating Composition 4,833,041 May 23, 1989
Ornamental Design of a Bottle (1) Des. 366,209 January 16, 1996
PATENT SERIAL NO. FILING DATE
------ ---------- -----------
Ornamental Design of a Bottle Des. 29/040,135 June 9, 1995
Ornamental Design of a Bottle Des. 29/051,870 March 8, 1996
Ornamental Design of a Bottle Des. 29/051,289 March 8, 1996
Ornamental Design of a Bottle Des. 29/051,869 March 8, 1996
Beverage Bottle Des. 29/056,085 June 21, 1996
-----------------------------
(1) The Company has an undivided 50% interest in this patent.
46
ANNEX H
to
SECURITY AGREEMENT
------------------
ASSIGNMENT OF SECURITY INTEREST
IN UNITED STATES COPYRIGHTS
---------------------------
WHEREAS, ANCHOR GLASS ACQUISITION CORPORATION, a Delaware corporation
(the "Assignor"), having its chief executive office at One Anchor Plaza, 0000
Xxxxxx Xxxxx Xxxxxxx, Xxxxx, Xxxxxxx 00000-0000 is the owner of all right, title
and interest in and to the United States copyrights and associated United States
copyright registrations and applications for registration set forth in Schedule
A attached hereto;
WHEREAS, BANKERS TRUST COMPANY, as Collateral Agent, having its
principal offices at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the
"Assignee"), desires to acquire a security interest in, and lien upon, all of
Assignor's right, title and interest in and to Assignor's copyrights and
copyright registrations and applications therefor; and
WHEREAS, the Assignor is willing to assign and grant to the Assignee a
security interest in, and lien upon, the copyrights and copyright registrations
and applications therefor described above.
NOW, THEREFORE, for good and valuable consideration, the sufficiency
and receipt of which is hereby acknowledged, and subject to the terms and
conditions of the Security Agreement, dated as of February 5, 1997, between the
Assignor and the Assignee (as amended from time to time, the "Security
Agreement"), the Assignor hereby assigns and grants to the Assignee a security
interest in, and lien upon, all of Assignor's right, title and interest in and
to Assignor's copyrights and copyright registrations and applications therefor
set forth in Schedule
47
ANNEX H
Page 2
A attached hereto (the "Copyrights"), together with (i) all Proceeds (as such
term is defined in the Security Agreement referred to below) of the Copyrights,
and (ii) all causes of action arising prior to or after the date hereof for
infringement of any Copyright.
This Assignment of Security Interest is made to secure the satisfactory
performance and payment of all Obligations (as such term is defined in the
Security Agreement) of the Assignor and shall be effective as of the date of the
Security Agreement. After the termination of the Total Commitments, or at such
time as no Note is outstanding and all Loans and other Obligations have been
paid in full, the Assignee shall, upon such satisfaction, execute, acknowledge,
and deliver to Assignor an instrument in writing releasing the security interest
in the Copyrights acquired under this Assignment of Security Interest.
This Assignment of Security Interest has been granted in conjunction
with the security interest granted to the Assignee under the Security Agreement.
The rights and remedies of the Assignee with respect to the security interest
granted herein are without prejudice to, and are in addition to those set forth
in the Security Agreement, all terms and provisions of which are incorporated
herein by reference. In the event that any provisions of this Assignment are
deemed to conflict with the Security Agreement, the provisions of the Security
Agreement shall govern.
48
ANNEX H
Page 3
IN WITNESS WHEREOF, the undersigned have executed this
Assignment of Security Interest at New York, New York as of the ___day of
__________, 1997.
ANCHOR GLASS ACQUISITION
CORPORATION, Assignor
By______________________
Name:
Title:
BANKERS TRUST COMPANY, as
Collateral Agent, Assignee
By______________________
Name:
Title:
00
XXXXX XX XXX XXXX )
) ss.:
COUNTY OF NEW YORK )
On this __ day of ________, _____ before me personally came
______________, who being duly sworn, did depose and say that [s]he is
___________________ of ANCHOR GLASS ACQUISITION CORPORATION, that [s]he is
authorized to execute the foregoing Assignment of Security Interest on behalf of
said corporation and that [s]he did so by authority of the Board of Directors of
said corporation.
________________________
Notary Public
00
XXXXX XX XXX XXXX )
) ss.:
COUNTY OF NEW YORK )
On this __ day of ________, 199 before me personally came
_______________, who being duly sworn, did depose and say that [s]he is
___________________ of BANKERS TRUST COMPANY, that [s]he is authorized to
execute the foregoing Assignment of Security Interest on behalf of said company
and that [s]he did so by authority of the Board of Directors of said company.
__________________________
Notary Public
51
SCHEDULE A
----------
COPYRIGHTS
----------
REGISTRATION REGISTRATION COPYRIGHT
NUMBERS DATE NAME
------------ ------------- ---------
VA733-169 June 26, 1995 Party Jar
VA733-170 June 26, 1995 Oriental Floral Jar
VA733-171 June 26, 1995 Floral Grid Jar
VA733-172 June 26, 1995 Flower Garden Jar
VA733-173 June 26, 1995 Heart Sampler Jar
VA733-174 June 26, 1995 Hearts Galore Jar
VA733-175 June 26, 1995 Modern Floral Jar
VA733-176 June 26, 1995 Ivy Jar
VA733-177 June 26, 1995 Rose Buds Jar
VA733-178 June 26, 1995 Roosters Jar
VA733-179 June 26, 1995 Plaid Jar
VA733-180 June 26, 1995 Peach Blossom Jar
VA733-181 June 26, 1995 Crocus Jar
VA733-182 June 26, 1995 Cows Jar
VA733-183 June 26, 1995 Contemporary Grid Jar
VA733-184 June 26, 1995 Cherries Jar
VA733-185 June 26, 1995 Checkerboard Scribble Jar
VA733-186 June 26, 1995 Celestial Jar
VA733-187 June 26, 1995 Victorian Rose Jar
VA733-188 June 26, 1995 Wild Iris Jar
VA733-189 June 26, 1995 Assorted Fruit Jar
VA733-190 June 26, 1995 Splatters 1 Jar
VA733-191 June 26, 1995 Splatters 2 Jar
VA733-192 June 26, 1995 Surfing Suntea Jar
VA733-193 June 26, 1995 Sunrise Suntea Jar
VA733-194 June 26, 1995 Scribble Stripes Jar
VA733-195 June 26, 1995 Scribble Fish Jar
VA733-196 June 26, 1995 Tropical Birds Jar
VA733-197 June 26, 1995 Tropical Fish Jar
VA733-198 June 26, 1995 Tulips Jar
VA733-199 June 26, 1995 Sailboats Jar
