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EXHIBIT 10.46
SECURITY AGREEMENT
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This SECURITY AGREEMENT, dated as of August 11, 2000 (this
"Agreement"), is made among CENTRAL CONSUMER FINANCE COMPANY, a Delaware
corporation, ("Borrower"), CENTRAL CHECK CASHING, INC., a California corporation
("CCCI"), and CENTRAL CONSUMER COMPANY OF NEVADA, a Nevada corporation ("CCCN"),
(Borrower, CCCI and CCCN are each a "Grantor" and collectively and severally
"Grantors") and UNION BANK OF CALIFORNIA, N.A., as agent (in such capacity, and
together with its successors, the "Agent") for the Lenders (as hereafter
defined) under that certain Credit Agreement, dated as of August 11, 2000 (as
amended, restated, modified, renewed, supplemented or extended from time to
time, the "Credit Agreement"), among the Borrowers, and the lenders party
thereto (collectively, "Lenders" and individually, a "Lender"), and the Agent.
The parties hereto agree as follows:
25. Definitions; Interpretation.
(a) Terms Defined in Credit Agreement. All capitalized terms used in
this Agreement and not otherwise defined herein have the
meanings specified in the Credit Agreement.
(b) Certain Defined Terms. As used in this Agreement, the following
terms have the following meanings:
"Accounts" means any and all accounts of any or all Grantors,
whether now existing or hereafter acquired or arising, and in any event includes
all accounts receivable, contract rights, rights to payment, and other
obligations of any kind owed to any or all Grantors arising out of or in
connection with the sale or lease of merchandise, goods, or commodities or the
rendering of services or arising from any other transaction, however evidenced,
and whether or not earned by performance, all guaranties, indemnities, and
security with respect to the foregoing, and all letters of credit relating
thereto, in each case whether now existing or hereafter acquired or arising.
"Assigned Benefits" means all of any Grantor's right, title and
interest in and to: (i) all payments and/or distributions of revenue, income,
profits, property and other sums now or hereafter due from any other Grantor in
respect of any Equity Interest in such other Grantor; (ii) all other monies owed
and payable to any Grantor by any other Grantor, whether owed in connection with
loans, management agreements, marketing agreements, other contracts, or
otherwise, each in effect as of the Closing Date or any amendments thereto
permitted under the Credit Agreement; (iii) the right of any Grantor to receive
any of the foregoing; and (iv) all Proceeds of the foregoing.
"Books" means all books, records and other written, electronic or
other documentation in whatever form maintained now or hereafter by or for any
or all Grantors in connection with the ownership of their assets or the conduct
of their business or evidencing or containing information relating to the
Collateral, including: (i) ledgers; (ii) records indicating, summarizing, or
evidencing Grantors' assets (including Inventory and Rights to Payment),
business operations, or financial condition; (iii) computer programs and
software; (iv) computer discs, tapes, files, manuals, and spreadsheets; (v)
computer printouts and output of whatever
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kind; (vi) any other computer prepared or electronically stored, collected, or
reported information and equipment of any kind; and (vii) any and all other
rights now or hereafter arising out of any contract or agreement between any or
all Grantors and any service bureau, computer, or data processing company or
other Person charged with preparing or maintaining any of any or all Grantors'
books or records or with credit reporting, including with regard to any or all
Grantors' Accounts, Consumer Contracts, or other Rights to Payment.
"Chattel Paper" means all writings of whatever sort which
evidence a monetary obligation and a security interest in or lease of specific
goods, whether now existing or hereafter arising.
"Collateral" has the meaning specified in Section 2.
"Consumer Contracts" has the meaning set forth in the Credit
Agreement.
"Copyright Security Agreement" means the Copyright Security
Agreement executed and delivered by Grantors in favor of Agent, substantially in
the form of Exhibit "A" hereto, as the same may be amended from time to time.
"Deposit Account" means any demand, time, savings, passbook or
like account now or hereafter maintained by or for the benefit of any or all
Grantors with a bank, savings and loan association, credit union or like
organization (including Agent)) and all funds and amounts therein, whether or
not restricted or designated for a particular purpose.
"Documents" means any and all documents of title, bills of
lading, dock warrants, dock receipts, warehouse receipts and other documents of
any or all Grantors, whether or not negotiable, and includes all other documents
which purport to be issued by a bailee or agent and purport to cover goods in
any bailee's or agent's possession which are either identified or are fungible
portions of an identified mass, including such documents of title made available
to any or all Grantors for the purpose of ultimate sale or exchange of goods or
for the purpose of loading, unloading, storing, shipping, transshipping,
manufacturing, processing, or otherwise dealing with goods in a manner
preliminary to their sale or exchange, in each case whether now existing or
hereafter acquired or arising.
"Equipment" means all now existing or hereafter acquired
equipment of any or all Grantors in all of its forms, wherever located (other
than certificated motor vehicles, registered aircraft, and documented or
certificated vessels), and in any event includes any and all machinery,
furniture, equipment, furnishings, and fixtures in which any or all Grantors now
or hereafter acquire any right, and all other goods and tangible personal
property (other than Inventory), including tools, parts and supplies,
automobiles, trucks, tractors and other vehicles, computer and other electronic
data processing equipment, and other office equipment, computer programs, and
related data processing software, and all additions, substitutions,
replacements, parts, accessories, and accessions to and for the foregoing, now
owned or hereafter acquired, and including any of the foregoing which are or are
to become fixtures on real property.
"Equity Interest" means (a) with respect to any corporation, a
capital interest therein, including, without limitation, any interest therein
which entitles the holder thereof to share in the revenue, income, earnings or
losses thereof or to vote or otherwise participate in any
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election of one or more directors thereof, (b) with respect to any general
partnership, limited partnership or limited liability partnership, a partnership
interest therein, including, without limitation, any interest therein which
entitles the holder thereof to share in the revenue, income, earnings or losses
thereof or to vote or otherwise participate in any election of one or more
members of the managing body thereof (c) with respect to any limited liability
company, a membership interest therein, including without limitation, any
interest therein which entitles the holder thereof to share in the revenue,
income earnings or losses thereof to share in the revenue, income, earnings or
losses thereof or to vote or otherwise participate in any election of one or
more members of the managing body thereof, (d) with respect to any trust, a
beneficial interest therein, including, without limitation, any interest therein
which entitles the holder thereof to share in the corpus of such trust or in any
of the revenue income, earnings or losses thereof or to vote or otherwise
participate in any designation of one or more trustees thereof, (e) with respect
to any other Person that is a business entity, an equity interest therein,
including, without limitation, any interest therein which entitles the holder
thereof to share in the revenue, income, earnings or losses thereof or to vote
or otherwise participate in the election of one or more members of the managing
body thereof, and (f) all warrants and options in respect of any of the
foregoing and all other securities which are convertible or exchangeable
therefor.
"Financing Statements" has the meaning specified in Section 3.
"General Intangibles" means all general intangibles of any or all
Grantors, now existing or hereafter acquired or arising, and in any event
includes: (i) all tax and other refunds, rebates or credits of every kind and
nature to which any or all Grantors are now or hereafter may become entitled;
(ii) all goodwill, choses in action and causes of action, whether legal or
equitable, whether in contract or tort and however arising; (iii) all
Intellectual Property Collateral; (iv) all uncertificated securities and
interests in limited and general partnerships; (v) all rights of stoppage in
transit, replevin and reclamation; (vi) all licenses, permits, consents,
indulgences and rights of whatever kind issued in favor of or otherwise
recognized as belonging to any or all Grantors by any Governmental Authority;
and (vii) all indemnity agreements, guaranties, insurance policies and other
contractual, equitable and legal rights of whatever kind or nature; in each case
whether now existing or hereafter acquired or arising; provided, that the term
"General Intangibles" shall not include Equity Interests.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory, or administrative functions of or pertaining
to government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
"Grantor" and "Grantors" means the Grantors named in the
introduction to this Agreement and any party executing and delivering a Guaranty
Joinder Letter to the Agent pursuant to Section 4.4 of the Guaranty.
"Instruments" means any and all negotiable instruments,
certificated securities (including those representing an Equity Interest), and
every other writing which evidences a right to the payment of money, in each
case whether now existing or hereafter acquired (including the
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stock in any Subsidiary of any Grantor which is hereafter acquired by such
Grantor), all of such which is now existing being as described in Schedule 2.
"Intellectual Property Collateral" means the following properties
and assets owned or held by any or all Grantors or in which any or all Grantors
otherwise have any interest, now existing or hereafter acquired or arising:
(i) all patents and patent applications, domestic or foreign, all
licenses relating to any of the foregoing, and all income and
royalties with respect to any licenses (including such patents,
patent applications, and patent licenses as described in
Schedule 1), all rights to xxx for past, present or future
infringement thereof, all rights arising therefrom and
pertaining thereto and all reissues, divisions, continuations,
renewals, extensions, and continuations-in-part thereof
(collectively, the "Patents");
(ii) all copyrights and applications for copyright, domestic or
foreign, together with the underlying works of authorship
(including titles), whether or not the underlying works of
authorship have been published and whether said copyrights are
statutory or arise under the common law, and all other rights
and works of authorship, all rights, claims, and demands in any
way relating to any such copyrights or works, including
royalties and rights to xxx for past, present, or future
infringement, and all rights of renewal and extension of
copyright (collectively, the "Copyrights");
(iii) all state (including common law), federal and foreign
trademarks, service marks, and trade names, and applications for
registration of such trademarks, service marks and trade names,
all licenses relating to any of the foregoing and all income and
royalties with respect to any licenses (including such marks,
names, applications and licenses as described in Schedule 1),
whether registered or unregistered and wherever registered, all
rights to xxx for past, present, or future infringement or
unconsented use thereof, all rights arising therefrom and
pertaining thereto and all reissues, extensions and renewals
thereof (collectively, the "Trademarks");
(iv) all trade secrets, confidential information, customer lists,
license rights, advertising materials, operating manuals,
methods, processes, know-how, sales literature, drawings,
specifications, blue prints, descriptions, inventions, name
plates, and catalogs; and
(v) the entire goodwill of or associated with the businesses now or
hereafter conducted by any or all Grantors connected with and
symbolized by any of the aforementioned properties and assets.
"Inventory" means any and all of any or all Grantors' inventory
in all of its forms, wherever located, whether now owned or hereafter acquired,
and in any event includes all goods (including goods in transit) which are held
for sale, lease, or other disposition, including those held for display or
demonstration or out on lease, or consignment or to be furnished under a
contract of service, or which are raw materials, work in process, finished
goods, or materials used or consumed in any or all Grantors' business, and the
resulting product or mass, and all repossessed, returned, rejected, reclaimed,
and replevied goods, together with all parts, components, supplies, packing, and
other materials used or usable in connection with the
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manufacture, production, packing, shipping, advertising, selling, or furnishing
of such goods; and all other items hereafter acquired by any or all Grantors by
way of substitution, replacement, return, repossession, or otherwise, and all
additions and accessions thereto, and any Document representing or relating to
any of the foregoing at any time.
"Investment Property" means (i) a security, whether certificated
or uncertificated, (ii) a security entitlement, (iii) a securities account, (iv)
a commodities contract, (v) any other investment property (as defined in the
UCC), (vi) all rights to delivery of any security, commodity contract, or other
financial asset and all other entitlements with respect thereto, and (vii) all
claims, demands and causes of action (whether arising under state or federal
securities laws or otherwise) relating to the offering, purchase, sale, or
holding of any of the foregoing.
"Lender Party" means, as the context may require, any Lender or
the Agent and each of their respective successors, transferees, and assigns.
"Patent Security Agreement" means the Patent Security Agreement
executed and delivered by Grantors in favor of the Agent, substantially in the
form of Exhibit "B" hereto, as the same may be amended from time to time.
"Payment Account" means a bank account maintained with Agent or other
depositary acceptable to Agent and to which the proceeds of Accounts, Consumer
Contracts, or other Rights to Payment are deposited or credited, and which is
maintained in the name of Agent or Borrower, as Agent may determine, on terms
acceptable to the Agent and in which Agent has a first priority, perfected
security interest.
"Proceeds" means whatever is receivable or received from or upon
the sale, lease, license, collection, use, exchange, or other disposition,
whether voluntary or involuntary, of any Collateral or other assets of any or
all Grantors, including "proceeds" as defined at UCC Section 9306, any and all
proceeds of any insurance, indemnity, warranty, or guaranty payable to or for
the account of any or all Grantors from time to time with respect to any of the
Collateral, any and all payments (in any form whatsoever) made or due and
payable to any or all Grantors 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), any and all other amounts from time to time
paid or payable under or in connection with any of the Collateral or for or on
account of any damage or injury to or conversion of any Collateral by any
Person, any and all other tangible or intangible property received upon the sale
or disposition of Collateral, and all proceeds of proceeds.
"Rights to Payment" means all Accounts, all Consumer Contracts,
and any and all rights and claims to the payment or receipt of money or other
forms of consideration of any kind in, to and under all Chattel Paper,
Documents, General Intangibles, Instruments, and Proceeds.
"Secured Obligations" means (a) the "Obligations" as defined in
the Credit Agreement and includes all obligations, liabilities and indebtedness
of every kind and character, whether now existing or hereafter arising, whether
absolute or contingent, and whether direct or indirect, arising directly or
indirectly under or pursuant to any one or more of the Loan Documents, whether
for principal, interest (including, without limitation, interest that, but for
the filing of a petition in bankruptcy, would accrue on such obligations,
liabilities or indebtedness),
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fees (including, without limitation, reasonable attorneys' fees of outside
counsel and the reasonable allocated fees of internal counsel) or expenses, (b)
all obligations, liabilities and indebtedness of Borrower to Union Bank of
California, N.A. of every kind and character, whether now existing or hereafter
arising, whether absolute or contingent, and whether direct or indirect, arising
directly or indirectly under or pursuant to any and all transactions, agreements
or documents now existing or hereafter entered into, which provides for an
interest rate, credit, commodity or equity swap, cap, floor, collar, forward
foreign exchange transaction, currency swap, cross currency rate swap, currency
option, or any combination of, or option with respect to, these or similar
transactions, for the purpose of hedging Borrower's exposure to fluctuations in
interest or exchange rates, loan, credit exchange, security or currency
valuations or commodity prices, whether for principal, interest (including,
without limitation, interest that, but for the filing of a petition in
bankruptcy, would accrue on such obligations, liabilities or indebtedness), fees
(including, without limitation, reasonable attorneys' fees of outside counsel
and the reasonable allocated fees of internal counsel) or expenses, and (c) all
obligations, liabilities and indebtedness of Borrower to Union Bank of
California, N.A. of every kind and character, whether now existing or hereafter
arising, whether absolute or contingent, and whether direct or indirect, arising
directly or indirectly under or pursuant to any cash management or related
services including the automatic clearing house transfer of funds by the Bank
for the account of Borrower pursuant to agreement or overdrafts, whether for
principal, interest (including, without limitation, interest that, but for the
filing of a petition in bankruptcy, would accrue on such obligations,
liabilities or indebtedness), fees (including, without limitation, reasonable
attorneys' fees of outside counsel and the reasonable allocated fees of internal
counsel) or expenses.
"Trademark Security Agreement" means the Trademark Security
Agreement executed and delivered by Grantors in favor of the Agent,
substantially in the form of Exhibit "C" attached hereto, as the same be amended
from time to time.
"UCC" means the Uniform Commercial Code as the same may, from
time to time, be in effect in the State of California; provided in the event
that, by reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of the security interest in any Collateral is governed by
the Uniform Commercial Code as in effect in a jurisdiction other than the State
of California, the term "UCC" shall mean the Uniform Commercial Code as in
effect in such other jurisdiction for purposes of the provisions hereof relating
to such attachment, perfection or priority and for purposes of definitions
related to such provisions.
(c) Certain Rules of Construction. For purposes of this Agreement
and unless otherwise specified herein:
(i) Computation of Time Periods. For purposes of computing periods
of time: (A) the word "from" means "from and including" and the
words "to" and "until" each mean "to but excluding"; and (B)
periods measured in days shall be measured in calendar days.
(ii) Construction. References to the plural include the singular and
to the singular include the plural, references to any gender
include any other gender, the part includes the whole, the term
"including" is not limiting, and the term "or" has, except where
otherwise indicated, the inclusive meaning represented by the
phrase "and/or."
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References in this Agreement to any determination by the Agent
include good faith estimates (in the case of quantitative
determinations) by and good faith beliefs (in the case of
qualitative determinations) of the Agent. The words "hereof,"
"herein," "hereby," and "hereunder," and any other similar
words, refer to this Agreement as a whole and not to any
particular provision of this Agreement. Article, section,
subsection, clause, exhibit, and schedule references are to this
Agreement. Any reference to this Agreement or any other Loan
Document includes all permitted alterations, amendments,
changes, extensions, modifications, renewals, or supplements
thereto or thereof, as applicable.
(iii) Exhibits and Schedules. All of the exhibits and schedules
attached are incorporated herein by this reference.
(iv) Terms Defined in the UCC. All terms used herein which are not
otherwise specifically defined (including the term "good faith")
shall have the meaning set forth in the UCC if defined therein.
(v) No Presumption Against Any Party. Neither this Agreement nor any
other Loan Document nor any uncertainty or ambiguity herein or
therein shall be construed or resolved using any presumption
against any party hereto or thereto, whether under any rule of
construction or otherwise. On the contrary, this Agreement and
the other Loan Documents have been reviewed by each of the
parties and their counsel and, in the case of any ambiguity or
uncertainty, shall be construed and interpreted according to the
ordinary meaning of the words used so as to fairly accomplish
the purposes and intentions of all parties.
(vi) Independence of Provisions. All agreements and covenants
hereunder and under the other Loan Documents shall be given
independent effect such that if a particular action or condition
is prohibited by the terms of any such agreement or covenant,
the fact that such action or condition would be permitted within
the limitations of another agreement or covenant shall not be
construed as allowing such action to be taken or condition to
exist.
26. Security Interest.
(a) Grant of Security Interest. As security for the payment and
performance of the Secured Obligations, Grantors hereby pledge,
assign, transfer, hypothecate, and set over to the Agent for its
benefit and for the ratable benefit of the other Lender Parties,
and hereby grant to the Agent for its benefit and for the
ratable benefit of the other Lender Parties, a security interest
in, all of any or all Grantors' right, title, and interest in,
to, and under the following property, wherever located and
whether now existing or owned or hereafter acquired or arising
(collectively, the "Collateral"): (i) all Accounts, Consumer
Contracts, and other Rights to Payment; (ii) all Chattel Paper;
(iii) all Deposit Accounts; (iv) all Documents; (v) all
Equipment; (vi) all General Intangibles; (vii) all Investment
Property; (viii) all Instruments; (ix) all Inventory; (x) all
Intellectual Property Collateral; (xi) all Books; (xii) all of
any Grantor's rights with respect to the Assigned Benefits and
the right to receive the
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Assigned Benefits, whether now existing or hereafter arising,
including any Equity Interest in any Guarantor, and (xiii) the
all products and Proceeds of any and all of the foregoing.
(b) Grantors Remain Liable. Anything herein to the contrary
notwithstanding, prior to a foreclosure or other action which
results in none of Grantors maintaining any title or interest in
such Collateral and subject to the terms of this Agreement, (i)
Grantors shall remain liable under any contracts, agreements,
and other documents included in the Collateral, to the extent
set forth therein, to perform all of their respective (or joint
and several) duties and obligations thereunder to the same
extent as if this Agreement had not been executed, (ii) the
exercise by the Agent of any of the rights hereunder shall not
release Grantors from any of their respective (or joint and
several) duties or obligations under such contracts, agreements,
and other documents included in the Collateral, and (iii)
neither the Agent nor any other Lender Party shall have any
obligation or liability under any contracts, agreements, and
other documents included in the Collateral by reason of this
Agreement, nor shall the Agent or any other Lender Party be
obligated to perform any of the obligations or duties of any or
all Grantors thereunder or to take any action to collect or
enforce any such contract, agreement, or other document included
in the Collateral hereunder.
(c) Continuing Security Interest. Grantors agree that this Agreement
shall create a continuing security interest in the Collateral
which shall remain in effect until terminated in accordance with
Section 22.
(d) Intellectual Property. Contemporaneously with the execution and
delivery of this Agreement, and in furtherance of the pledging,
assignment, transfer, hypothecation, set over, and grant by
Grantors to the Agent of a security interest in the Collateral,
Grantors shall execute and deliver the Copyright Security
Agreement, the Patent Security Agreement, and the Trademark
Security Agreement to the Agent.
(e) Payment of Assigned Benefits; Voting and Other Rights. So long
as no Event of Default is continuing, Grantors may receive the
Assigned Benefits and may exercise any voting and other rights
to which each is entitled as the holder of an Equity Interest in
any other Grantor; provided that no vote shall be cast or any
consent, waiver, or ratification given or any action taken which
would violate the terms of this Agreement, the other Loan
Documents, or any other instrument or agreement referred to
therein or herein. During the continuance of an Event of
Default, the provisions of Section 10 hereof shall apply.
(f) Grantors to Cooperate. Grantors each hereby covenant and agree
that it shall take any and all actions within its power to cause
all other Grantors in which it holds an Equity Interest to
comply with all terms and conditions of this Agreement, and
shall, as the holder of an Equity Interest in such other
Grantors, execute all checks, documents, agreements, and
instruments of assignments as the Agent may reasonably require
to effectuate the terms of this Agreement, and deliver all sums
and other property required to be paid and/or delivered to the
Agent under the terms of this Agreement.
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(g) Affected Foreign Shares. Agent acknowledges that Borrower, as a
Grantor, may deliver to Agent stock certificates, together with
undated stock powers, representing less than 66-2/3%, but not
less than 66%, of the outstanding shares of stock of the
Excluded Subsidiaries (as defined in the Credit Agreement); all
outstanding shares of the Excluded Subsidiaries being referred
to herein as the "Affected Foreign Shares"). Because the intent
of Borrower and Agent is to grant a security interest in a
percentage of the Affected Foreign Shares equal to the maximum
percentage of the Affected Foreign Shares that can be pledged to
Agent by Borrower without constituting an investment of earnings
in U.S. property under Section 956 (or any successor provision)
of the IRC that would trigger an increase in the gross income of
Borrower pursuant to Section 951 (or any successor provision) of
the IRC (such percentage being the "Maximum Percentage"), Agent
hereby confirms that the Pledged Shares of each Affected Foreign
Subsidiary shall refer only to, and the grants of security
interests created hereby shall extend only to, the Maximum
Percentage of the Affected Foreign Shares. If Agent shall take
any action to foreclose on the Affected Foreign Shares, Agent
hereby agrees to act only with regard to the Maximum Percentage
of the Affected Foreign Shares; provided that nothing herein
shall preclude Agent from exercising the stock -------- powers
with respect to all outstanding Affected Foreign Shares to take
such action as may be necessary to transfer the Affected Foreign
Shares other than the Maximum Percentage of the Affected Foreign
Shares (the "Remaining Shares") to Borrower or to such other
person or entity as Borrower designates. The parties hereto
agree that Agent has no fiduciary or other responsibilities or
duties with regard to the Remaining Shares and that Agent is
serving only as custodian with respect to the Remaining Shares.
27. Financing Statements, Etc.
(a) Perfection. Grantors shall execute and deliver to the Agent
concurrently with the execution of this Agreement, and at any
time and from time to time thereafter, all financing statements,
continuation financing statements, termination statements,
security agreements, chattel mortgages, assignments, patent,
copyright and trademark collateral assignments, fixture filings,
warehouse receipts, documents of title, affidavits, reports,
notices, schedules of account, letters of authority, and all
other documents and instruments, in form satisfactory to the
Agent (the "Financing Statements"), and take all other action,
as the Agent may reasonably request, to perfect and continue
perfected, maintain the priority of or provide notice of the
Agent's security interest in the Collateral and to accomplish
the purposes of this Agreement.
(b) Notice of Security Interest. In accordance with Section
9302(1)(g) of the UCC, written notice of the security interest
of the Agent in each Deposit Account maintained with a Lender is
hereby given to such Lender.
28. Representations and Warranties. In addition to the representations
and warranties of Grantors set forth in the Credit Agreement, which are
incorporated herein by this reference, Grantors represent and warrant to the
Agent that:
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(a) Location of Chief Executive Office and Collateral. Each
Grantor's chief executive office and principal place of business
is located at the address set forth in Schedule 1, and all other
locations where any or all Grantors conduct business are set
forth in Schedule 1.
(b) Locations of Books. All locations where Books pertaining to the
Rights to Payment are kept, including all equipment necessary
for accessing such Books and the names and addresses of all
service bureaus, computer or data processing companies and other
Persons keeping any Books or collecting Rights to Payment for
any or all Grantors, are set forth in Schedule 1.
(c) Trade Names and Trade Styles. All trade names and trade styles
under which any or all Grantors presently conducts its business
operations are set forth in Schedule 1, and, except as set forth
in Schedule 1, none of Grantors has, at any time during the
preceding five years: (i) been known as or used any other
corporate, trade, or fictitious name; (ii) changed its name;
(iii) been the surviving or resulting corporation in a merger or
consolidation; or (iv) acquired through asset purchase or
otherwise any business of any Person.
(d) Ownership of Collateral. Each Grantor is, and, except as
permitted by Section 5(j) hereof and except for dispositions of
Collateral in compliance with Section 7.04 of the Credit
Agreement, will continue to be, the sole and complete owner of
the Collateral owned by it, except for Collateral co-owned by
two or more Grantors, as to which such Grantors are and will
continue to be the sole and complete owners thereof (or, in the
case of after-acquired Collateral, at the time such Grantor
acquires rights in such Collateral, will be the sole and
complete owner thereof, except for Collateral co-owned by two or
more Grantors, as to which such Grantors will be the sole and
complete owners thereof), free from any Lien other than
Permitted Liens;
(e) Enforceability; Priority of Security Interest. (i) This
Agreement creates a security interest which is enforceable
against the Collateral in which any or all Grantors now have
rights and will create a security interest which is enforceable
against the Collateral in which any or all Grantors hereafter
acquire rights at the time any or all Grantors, as the case may
be, acquire any such rights; and (ii) the Agent has a perfected
and first priority (except for Permitted Liens) security
interest in the Collateral, in which any or all Grantors now
have rights, and will have a perfected and first priority
(except for Permitted Liens) security interest in the Collateral
in which any or all Grantors hereafter acquire rights at the
time such Grantor or Grantors, as the case may be, acquire any
such rights, in each case for the Agent's own benefit and for
the ratable benefit of the other Lender Parties, and in each
case securing the payment and performance of the Secured
Obligations.
(f) Other Financing Statements. Other than financing statements or
similar filings under the UCC or any comparable law ("UCC
Financing Statements") related to Permitted Liens, no effective
UCC Financing Statement naming any or all Grantors as debtor,
assignor, grantor, mortgagor, pledgor, or the like and covering
all or any part of the Collateral is on file in any filing or
recording office in any jurisdiction.
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(g) Rights to Payment. (i) The Rights to Payment represent valid,
binding and enforceable obligations of the account debtors or
other Persons obligated thereon, representing undisputed, bona
fide transactions completed in accordance with the terms and
provisions contained in any documents related thereto, and are
and will be genuine, free from Liens, and not subject to any
adverse claims, counterclaims, setoffs, defaults, disputes,
defenses, discounts, retainages, holdbacks or conditions
precedent of any kind of character, except to the extent
reflected by Grantors' respective reserves for uncollectible
Rights to Payment or to the extent, if any, that such account
debtors or other Persons may be entitled to normal and ordinary
course trade discounts, returns, adjustments and allowances in
accordance with Section 5(m), or as otherwise disclosed to the
Agent in writing;
(i) to Grantors' knowledge, all account debtors and other obligors
on the Rights to Payment are solvent and generally paying their
debts as they come due (except for Rights to Payment of account
debtors or other obligors for which Grantors have taken adequate
reserves in accordance with GAAP).
(ii) to Grantors' knowledge, all Rights to Payment comply in all
material respects with all applicable laws concerning form,
content, and manner of preparation and execution, including
where applicable any federal or state consumer credit laws;
(iii) none of Grantors have assigned any of its rights under the
Rights to Payment except as provided in this Agreement or as set
forth in or permitted by the other Loan Documents;
(iv) all statements made, all unpaid balances and all other
information in the Books and other documentation relating to the
Rights to Payment are in all material respects true and correct
and what they purport to be; and
(v) Grantors have no knowledge of any fact or circumstance which
would in any material respect impair the validity or
collectibility of any material part of the Rights to Payment.
(h) Inventory. No Inventory is stored with any bailee, warehouseman,
or similar Person or on any premises leased to any or all
Grantors, nor has any Inventory been consigned to any or all
Grantors or consigned by any or all Grantors to any Person or is
held by any or all Grantors for any Person under any "xxxx and
hold" or other arrangement, except as set forth in Schedule 1.
(i) Intellectual Property. (i) Except as set forth in Schedule 1,
none of Grantors (directly or through any Subsidiary) owns,
possesses, or uses under any licensing arrangement any patents,
copyrights, trademarks, service marks, or trade names, nor is
there currently pending before any Governmental Authority any
application for registration of any Intellectual Property
Collateral;
(i) all Intellectual Property Collateral are subsisting and none
have been adjudged invalid or unenforceable in whole or in part;
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(ii) all maintenance fees required to be paid on account of any
Patents have been timely paid for maintaining such patents in
force, and, to Grantors' knowledge, each of the Patents is valid
and enforceable and Grantors have notified the Agent in writing
of all material prior art (including public uses and sales) of
which it is aware;
(iii) to Grantors' knowledge after due inquiry, no material
infringement or unauthorized use presently is being made of any
Intellectual Property Collateral by any Person;
(iv) each Grantor is the sole and exclusive owner of its respective
Intellectual Property Collateral and if any Intellectual
Property Collateral is co-owned by two or more Grantors, such
Grantors are the sole and exclusive co-owners of such
Intellectual Property Collateral; and the past, present, and
contemplated future use of such Intellectual Property Collateral
by such Grantor or Grantors, as the case may be, has not, does
not, and will not infringe or violate any right, privilege, or
license agreement of or with any other Person; and
(v) each Grantor owns, has material rights under, is a party to, or
an assignee of a party to all of its material licenses, Patents,
Copyrights, Trademarks, and all other of its Intellectual
Property Collateral necessary to continue to conduct its
business as heretofore conducted.
(j) Equipment. (i) None of the material Equipment or other material
Collateral is affixed to real property, except Collateral with
respect to which Grantors have supplied the Agent with all
information and documentation necessary to make all fixture
filings required to perfect and protect the priority of the
Agent's security interest in all such Collateral which may be
fixtures as against all Persons having an interest in the
premises to which such property may be affixed; and
(k) Deposit Accounts. The names and addresses of all financial
institutions at which Grantors maintain their respective Deposit
Accounts, and the account numbers and account names of such
Deposit Accounts, are set forth in Schedule 1. None of Grantors
will establish or maintain any Deposit Account with any
financial intermediary unless Grantors shall first obtain the
written undertaking and acknowledgement from such financial
intermediary with respect to Lenders' security interest therein,
all such undertakings and acknowledgements to be satisfactory in
form and substance to the Agent in the exercise of its
reasonable discretion.
(l) Compliance with Federal Fair Labor Standards Act. All Collateral
has been and will be produced in compliance with the Federal
Fair Labor Standards Act.
29. Covenants. In addition to the covenants of Grantors set forth in the
Credit Agreement, which are incorporated herein by this reference, until this
Agreement has been terminated in accordance with Section 22 hereof, Grantors
agree that:
(a) Defense of Collateral. Grantors will appear in and defend any
action, suit, or proceeding which may affect to a material
extent any or all Grantors' title to, or right or interest in,
or the Agent's right to or interest in, any material Collateral.
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(b) Preservation of Collateral. Grantors will do and perform all
reasonable acts that may be necessary and appropriate to
maintain, preserve and protect the Collateral.
(c) Compliance with Laws, Etc. Grantors will comply in all material
respects with all laws, regulations, and ordinances, and all
policies of insurance, relating in a material way to the
possession, operation, maintenance, and control of the
Collateral.
(d) Location of Books and Chief Executive Office. Grantors will: (i)
keep all Books pertaining to the Rights to Payment at the
locations set forth in Schedule 1; and (ii) give at least 30
days' prior written notice to the Agent of (A) any changes in
any such location where Books pertaining to the Rights to
Payment are kept, including any change of name or address of any
service bureau, computer or data processing company or other
Person preparing or maintaining any Books or collecting Rights
to Payment for any or all Grantors or (B) any changes in the
location of Grantors' respective chief executive offices or
principal places of business.
(e) Location of Collateral. Grantors will: (i) keep all material
Collateral at the locations set forth in Schedule 1 and not
remove any material Collateral from such locations (other than
disposals of Collateral permitted by subsection (i)) except upon
at least 30 days' prior written notice of any removal to the
Agent; and (ii) give the Agent at least 30 days' prior written
notice of any change in the locations set forth in Schedule 1.
(f) Change in Name, Identity or Structure. Grantors will give at
least 30 days' prior written notice of (i) any change in name,
(ii) any changes in, additions to, or other modifications of
their respective trade names and trade styles set forth in
Schedule 1, and (iii) any changes in their respective identities
or structures in any manner which might make any Financing
Statement filed hereunder incorrect or misleading.
(g) Maintenance of Records. Grantors will keep separate, accurate,
and complete Books with respect to all Accounts, Consumer
Contracts, and Chattel Paper.
(h) Disposition of Collateral. Grantors will not surrender or lose
possession of (other than to the Agent), sell, lease, rent, or
otherwise dispose of or transfer any of the Collateral or any
right or interest therein, except to the extent permitted by the
Credit Agreement.
(i) Liens. Other than Permitted Liens, Grantors will keep the
Collateral free of all Liens.
(j) Leased Premises. Upon the Agent's request, Grantors will use
their best efforts to obtain from each Person from whom any or
all Grantors lease any premises at which any Collateral is at
any time present such subordination, waiver, consent, and
estoppel agreements as the Agent may reasonably require, in form
and substance reasonably satisfactory to the Agent.
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(k) Rights to Payment. Grantors will:
(i) if required by the Agent (but not more frequently than annually
or, if an Event of Default has occurred and is continuing and
Requisite Lenders so require, then with such frequency as
Requisite Lenders may require) furnish to the Agent (A) master
customer listings, including all names and addresses, together
with copies or originals (as requested by the Agent) of
documents, customer statements, repayment histories and present
status reports relating to the Accounts and Consumer Contracts;
(B) accurate records and summaries of Accounts and Consumer
Contracts, including detailed agings specifying the name, face
value and date of each invoice, and listings of Accounts and
Consumer Contracts that are disputed or have been cancelled; and
(C) such other matters and information relating to the Accounts
or Consumer Contracts as the Agent shall from time to time
reasonably request;
(ii) give only normal discounts, allowances and credits as to
Accounts, Consumer Contracts and other Rights to Payment, in the
ordinary course of business, according to normal trade practices
utilized by Grantors in the past, and enforce all Accounts,
Consumer Contracts, and other Rights to Payment strictly in
accordance with their terms, and take all such action to such
end as may from time to time be reasonably requested by the
Agent, except that Grantors may grant any extension of the time
for payment or enter into any agreement to reduce the amount
owing on or with respect to, or compromise or settle for less
than the full amount thereof, any Account or other Right to
Payment in the ordinary course of business;
(iii) if any discount, allowance, credit, extension of time for
payment, agreement to make a rebate or otherwise to reduce the
amount owing on, or compromise or settle, an Account or other
Right to Payment exists or occurs, or if, to the knowledge of
any or all Grantors, any dispute, setoff, claim, counterclaim or
defense exists or has been asserted or threatened with respect
to an Account or other Right to Payment, disclose such fact
fully to the Agent in the Books relating to such Account or
other Right to Payment and in connection with any invoice or
report furnished by any or all Grantors to the Agent relating to
such Account or other Right to Payment;
(iv) if any Accounts arise from contracts with the United States or
any department, agency, or instrumentality thereof, immediately
notify the Agent thereof and execute any documents and
instruments and take any other steps requested by the Agent in
order that all monies due and to become due thereunder shall be
assigned to the Agent and notice thereof given to the Federal
authorities under the Federal Assignment of Claims Act;
(v) in accordance with their sound business judgment, perform and
comply in all material respects with their joint and several
obligations in respect of the Accounts, Consumer Contracts and
other Rights to Payment; and
(vi) upon the request of the Agent (A) at any time, notify all or any
designated portion of the account debtors and other obligors on
the Rights to Payment of the security interest hereunder, and
(B) upon the occurrence and during the continuance of an
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Event of Default, notify the account debtors and other obligors
on the Rights to Payment or any designated portion thereof that
payment shall be made directly to the Agent or to such other
Person or location as the Agent shall specify.
(l) Documents, Etc. (i) Upon the request of the Agent, Grantors will
(A) immediately deliver to the Agent, or an agent designated by
it, appropriately endorsed or accompanied by appropriate
instruments of transfer or assignment, all Documents,
Instruments, Investment Property, and Chattel Paper, and all
other Rights to Payment at any time evidenced by promissory
notes, trade acceptances or other instruments, (B) xxxx all
Documents, Instruments, Chattel Paper, and all other Rights to
Payment at any time evidenced by promissory notes, trade
acceptances or other instruments, with the legend "This document
and all rights to payment hereunder are subject to a security
interest held by Union Bank of California, N.A., as agent" and
such other legends as the Agent shall reasonably specify, (C)
cause the issuer with respect to any Equity Interest in any
Subsidiary or in any issuer with respect to a security which is
not a certificated security directly held by any Grantor and not
embodied in a certificated security to duly execute and deliver
to the Agent a written agreement, in form and substance
satisfactory to the Agent, by such issuer to comply with
instructions originated by the Agent without further consent by
any Grantor, and (D) cause the securities intermediary of any
securities account or commodities account to duly execute and
deliver to the Agent a written agreement, in form and substance
satisfactory to the Agent, by such securities intermediary to
comply with instructions originated by the Agent without further
consent by any Grantor.
(ii) Grantors shall not, without the prior written consent of the
Agent:
(1) approve the amendment or termination of the Organization
Documents of any other Grantor in which it holds an Equity
Interest in a manner materially adverse to the rights of the
Agent and the other Lender Parties under this Agreement or the
other Loan Documents; or
(2) permit any Guarantor to issue any additional Equity Interests or
redeem any Equity Interests;
(iii) One or more of Grantors shall own the entire Equity Interest in
any Person that becomes a Grantor as the result of such Person's
execution of a Guaranty Joinder Letter.
(m) Inventory. Grantors will:
(i) if requested by the Agent (but no more frequently than annually,
or if an Event of Default has occurred and is continuing and the
Requisite Lenders so require, then at such times as Requisite
Lenders shall request), prepare and deliver to the Agent a
report of all Inventory, in form and substance satisfactory to
the Agent; and
(ii) not store any Inventory with a bailee, warehouseman, or similar
Person or on premises leased to any or all Grantors, nor dispose
of any Inventory on a xxxx-and-hold, guaranteed sale, sale and
return, sale on approval, consignment or similar basis,
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nor acquire any Inventory from any Person on any such basis,
without in each case giving the Agent prior written notice
thereof.
(n) Equipment. Grantors will, upon the Agent's reasonable request,
which shall be made no more frequently than annually unless an
Event of Default has occurred and is continuing, deliver to the
Agent a physical listing of the Equipment, in form and substance
reasonably satisfactory to the Agent. In addition, Grantors
will, upon the Agent's request made at any time, obtain the
written agreement of the lessor (or other controller) of any
real property upon which any Equipment is located permitting the
Agent to enter upon such real property, and either (at the
election of the Agent) remove such Equipment therefrom or
utilize such Equipment thereon for a period of at least 180 days
(or lesser period, as determined by the Agent, and for a monthly
rental payment no greater than the amount that the applicable
Grantor is obligated to pay with respect thereto), each such
written agreement to be otherwise in form and substance
satisfactory to the Agent.
(o) Intellectual Property Collateral. Grantors will:
(i) except in the ordinary course of business, not enter into any
agreements or transactions (including any license or royalty
agreement) pertaining to any material Intellectual Property
Collateral;
(ii) if reasonably within Grantors' abilities, not allow or suffer
any material Intellectual Property Collateral to become
abandoned, nor any registration thereof to be terminated,
forfeited, expired or dedicated to the public;
(iii) give the Agent, simultaneously with the delivery to the Agent of
the financial information required with respect to each fiscal
quarter pursuant to Section 6.01(b) of the Credit Agreement,
notice of any rights any Grantor may obtain to any material new
patentable inventions, copyrightable works or other material new
Intellectual Property Collateral, prior to the filing of any
application for registration thereof; and
(iv) diligently prosecute all applications for material Patents,
Copyrights, and Trademarks, and file and prosecute any and all
continuations, continuations-in-part, applications for reissue,
applications for certificate of correction and like matters as
shall be reasonable and appropriate in accordance with prudent
business practice, and promptly and timely pay any and all
maintenance, license, registration and other fees, taxes, and
expenses incurred in connection with any material Intellectual
Property Collateral.
If, before the Secured Obligations shall have been paid in full
and this Agreement shall have been terminated in accordance with Section 22
hereof, any or all Grantors shall obtain or become entitled to the benefit of,
as exclusive licensee, any material new Patents, Trademarks, or Copyrights or
any material new rights in any Patents, Trademarks, or Copyrights, Grantors
shall give to the Agent, simultaneously with the delivery to the Agent of the
financial information required with respect to each fiscal quarter pursuant to
Section 6.01(b) of the Credit Agreement, written notice thereof and, together
therewith (unless earlier requested by the Agent), deliver to the Agent a duly
executed Copyright Security Agreement, Patent Security
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Agreement, and/or Trademark Security Agreement adequately describing such new
Patents, Copyrights, and/or Trademarks, as appropriate, for recording or filing
as the Agent sees fit.
(p) Notices, Reports and Information. Grantors will (i) notify the
Agent of any material claim made or asserted against the
Collateral by any Person and of any material change in the
composition of the Collateral or other event which could
materially adversely affect the value of the Collateral or the
Agent's Lien thereon; (ii) furnish to the Agent such statements
and schedules further identifying and describing the Collateral
and such other reports and other information in connection with
the Collateral as the Agent may reasonably request, all in
reasonable detail; and (iii) upon request of the Agent, make
such demands and requests for information and reports as any or
all Grantors are entitled to make in respect of the Collateral.
(q) Collections. Upon receipt of any collections with respect to any
Accounts, Consumer Contracts, or other Rights to Payment,
Borrower shall immediately deliver all payments in their
original form duly endorsed in blank into a Payment Account. If,
notwithstanding such instructions, Borrower receives and retains
any proceeds of Accounts, Consumer Contracts, or other Rights to
Payment, it shall receive such payments as Agent's trustee, and
shall immediately deliver such payments to Agent in their
original form duly endorsed in blank or deposit them into a
Payment Account, as the Agent may direct. All collections
received in any Payment Account or directly by Borrower. So long
as an Event of Default has occurred and is continuing, Borrower,
at Agent's request, shall execute and deliver to Agent such
documents as Agent shall require to grant Agent access to any
post office box in which collections of Accounts, Consumer
Contracts, or other Rights to Payment are received.
(r) Additional Grantors. Upon any Person becoming a Grantor by
virtue of such Person's execution and delivery of a Guarantor
Joinder Letter, the Credit Parties will, simultaneously with the
delivery of such Guaranty Joinder Letter to the Agent, deliver
to the Agent information with respect to such additional Grantor
of the nature set forth in Schedules 1 and 2 hereto as is
required of Grantors in connection with their execution and
delivery of this Agreement. In connection therewith, such Person
shall execute such Financing Statements and other documents and
instruments (including a Copyright Security Agreement, Patent
Security Agreement and Trademark Security Agreement) as shall be
necessary in the judgment of the Agent to perfect the Agent's
security interest in any new Collateral acquired by the Agent as
the result of such Person becoming an additional Grantor.
30. Collection of Rights to Payment. Until the Agent exercises its
rights hereunder to collect Rights to Payment, Grantors shall endeavor in the
first instance diligently to collect all amounts due or to become due on or with
respect to the Rights to Payment. At the request of the Agent, upon and after
the occurrence and during the continuance of any Event of Default, all
remittances received by any or all Grantors shall be held in trust for the Agent
and, in accordance with the Agent's instructions, remitted to the Agent or
deposited to an account with the Agent in the form received (with any necessary
endorsements or instruments of assignment or transfer).
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31. Authorization; Agent Appointed Attorney-in-Fact. The Agent shall
have the right to, in the name of any or all Grantors, or in the name of the
Agent or otherwise, without notice to or assent by Grantors, and Grantors hereby
constitute and appoint the Agent (and any of the Agent's officers, employees, or
agents designated by the Agent) as Grantors' true and lawful attorney-in-fact,
with full power and authority to:
(i) sign any of the Financing Statements which must be executed,
filed, or recorded to perfect or continue perfected, maintain
the priority of or provide notice of the Agent's security
interest in the Collateral;
(ii) take possession of and endorse any notes, acceptances, checks,
drafts, money orders, or other forms of payment or security and
collect any Proceeds of any Collateral;
(iii) sign and endorse any invoice or xxxx of lading relating to any
of the Collateral, warehouse or storage receipts, drafts against
customers or other obligors, assignments, notices of assignment,
verifications, and notices to customers or other obligors;
(iv) notify the Postal Service authorities to change the address for
delivery of mail addressed to any or all Grantors to such
address as the Agent may designate and, without limiting the
generality of the foregoing, establish with any Person lockbox
or similar arrangements for the payment of the Rights to
Payment;
(v) receive, open, and dispose of all mail addressed to any or all
Grantors;
(vi) send requests for verification of Rights to Payment to the
customers or other obligors of any or all Grantors;
(vii) contact, or direct Grantors to contact, all account debtors and
other obligors on the Rights to Payment and instruct such
account debtors and other obligors to make all payments directly
to the Agent;
(viii) assert, adjust, xxx for, compromise, or release any claims under
any policies of insurance;
(ix) exercise dominion and control over, and refuse to permit further
withdrawals from, Deposit Accounts maintained with the Agent;
(x) notify each Person maintaining lockbox or similar arrangements
for the payment of the Rights to Payment to remit all amounts
representing collections on the Rights to Payment directly to
the Agent;
(xi) ask, demand, collect, receive, and give acquittances and
receipts for any and all Rights to Payment, enforce payment or
any other rights in respect of the Rights to Payment and other
Collateral, grant consents, agree to any amendments,
modifications, or waivers of the agreements and documents
governing the Rights to Payment and other Collateral, and
otherwise file any claims, take any action, or institute,
defend, settle, or adjust any actions, suits, or proceedings
with respect to the
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Collateral, as the Agent may deem necessary or desirable to
maintain, preserve, and protect the Collateral, to collect the
Collateral or to enforce the rights of the Agent with respect to
the Collateral;
(xii) execute any and all applications, documents, papers, and
instruments necessary for the Agent to use the Intellectual
Property Collateral and grant or issue any exclusive or
non-exclusive license or sublicense with respect to any
Intellectual Property Collateral;
(xiii) execute any and all endorsements, assignments, or other
documents and instruments necessary to sell, lease, assign,
convey, or otherwise transfer title in or dispose of the
Collateral;
(xiv) assert any and all Rights and Remedies and to collect all
damages, awards, and other monies resulting therefrom; and
(xv) execute any and all such other documents and instruments, and do
any and all acts and things for and on behalf of Grantors, which
the Agent may deem necessary or advisable to maintain, protect,
realize upon, and preserve the Collateral and the Agent's
security interest therein and to accomplish the purposes of this
Agreement.
The Agent agrees that, except upon and after the occurrence of an
Event of Default, it shall not exercise the power of attorney, or any rights
granted to the Agent, pursuant to clauses (ii) through (xv). The foregoing power
of attorney is coupled with an interest and irrevocable so long as any Lender
has any Commitment or the Secured Obligations have not been paid and performed
in full. Grantors hereby ratify, to the extent permitted by law, all that the
Agent shall lawfully and in good faith do or cause to be done by virtue of and
in compliance with this Section 7.
32. Agent Performance of Grantors Obligations. The Agent may perform or
pay any obligation which any or all Grantors have agreed to perform or pay under
or in connection with this Agreement, and Grantors shall reimburse the Agent on
demand for any amounts paid by the Agent pursuant to this Section 8.
33. Agent's Duties. Notwithstanding any provision contained in this
Agreement, the Agent shall have no duty to exercise any of the rights,
privileges or powers afforded to it and shall not be responsible to Grantors or
any other Person for any failure to do so or delay in doing so. Beyond the
exercise of reasonable care to assure the safe custody of Collateral in the
Agent's possession and the accounting for moneys actually received by the Agent
hereunder, the Agent shall have no duty or liability to exercise or preserve any
rights, privileges, or powers pertaining to the Collateral.
34. Remedies. (a)Remedies. Upon the occurrence and during the
continuance of any Event of Default, the Agent shall have, in addition to all
other rights and remedies granted to it in this Agreement, the Credit Agreement
or any other Loan Document, all rights and remedies of a secured party under the
UCC and other applicable laws. Without limiting the generality of the foregoing,
Grantors agree that the Agent may:
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(i) peaceably and without notice enter any premises of any or all
Grantors, take possession of any the Collateral, remove or
dispose of all or part of the Collateral on any premises or
elsewhere, and otherwise collect, receive, appropriate, and
realize upon all or any part of the Collateral, and demand, give
receipt for, settle, renew, extend, exchange, compromise,
adjust, or xxx for all or any part of the Collateral, as the
Agent may determine;
(ii) require Grantors to assemble all or any part of the Collateral
and make it available to the Agent at any place and time
designated by the Agent;
(iii) use or transfer any of Grantors' rights and interests in any
Intellectual Property Collateral, by license, by sublicense (to
the extent permitted by an applicable license) or otherwise, on
such conditions and in such manner as the Agent may determine;
(iv) secure the appointment of a receiver of the Collateral or any
part thereof to the extent and in the manner provided by
applicable law, as more particularly set forth in Section 10(f)
hereof;
(v) withdraw (or cause to be withdrawn) any and all funds from
Deposit Accounts;
(vi) assert any of the Rights and Remedies and receive and collect
all damages, awards, and other monies resulting therefrom; and
(vii) sell, resell, lease, use, assign, transfer, or otherwise dispose
of any or all of the Collateral in its then condition or
following any commercially reasonable preparation or processing
(utilizing in connection therewith any of any or all Grantors'
assets, without charge or liability to the Agent therefor) at
public or private sale, by one or more contracts, in one or more
parcels, at the same or different times, for cash or credit, or
for future delivery without assumption of any credit risk, all
as the Agent deems advisable; provided that Grantors shall be
credited with the net proceeds of sale only when such proceeds
are finally collected by the Agent. The Agent shall have the
right upon any such public sale, and, to the extent permitted by
law, upon any such private sale, to purchase the whole or any
part of the Collateral so sold, free of any right or equity of
redemption, which right or equity of redemption Grantors hereby
release, to the extent permitted by law. Grantors hereby agree
that the sending of notice by ordinary mail, postage prepaid, to
the address of Grantors set forth in the Credit Agreement, of
the place and time of any public sale or of the time after which
any private sale or other intended disposition is to be made,
shall be deemed reasonable notice thereof if such notice is sent
ten days prior to the date of such sale or other disposition or
the date on or after which such sale or other disposition may
occur, provided that the Agent may provide Grantors shorter
notice or no notice, to the extent permitted by the UCC or other
applicable law.
(b) License. For the purpose of enabling the Agent to exercise its
rights and remedies under this Section 10 or otherwise in
connection with this Agreement, Grantors hereby grant to the
Agent an irrevocable, non-exclusive and assignable license
(exercisable without payment or royalty or other compensation to
Grantors) to use, license or sublicense any Intellectual
Property Collateral.
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(c) Proceeds Account. To the extent that any of the Secured
Obligations may be contingent, unmatured, or unliquidated at
such time as there may exist an Event of Default, the Agent may,
at its election, (i) retain the proceeds of any sale,
collection, disposition or other realization upon the Collateral
(or any portion thereof) in a special purpose
non-interest-bearing restricted deposit account (the "Proceeds
Account") created and maintained by the Agent for such purpose
(which shall constitute a Deposit Account included within the
Collateral hereunder) until such time as the Agent may elect to
apply such proceeds to the Secured Obligations, and Grantors
agree that such retention of such proceeds by the Agent shall
not be deemed strict foreclosure with respect thereto; (ii) in
any manner elected by the Agent, estimate the liquidated amount
of any such contingent, unmatured, or unliquidated claims and
apply the proceeds of the Collateral against such amount; or
(iii) otherwise proceed in any manner permitted by applicable
law. Grantors agree that the Proceeds Account shall be a blocked
account and that upon the irrevocable deposit of funds into the
Proceeds Account, Grantors shall not have any right of
withdrawal with respect to such funds. Accordingly, Grantors
irrevocably waive until the termination of the security
interests granted under this Agreement in accordance with
Section 22 the right to make any withdrawal from the Proceeds
Account and the right to instruct the Agent to honor drafts
against the Proceeds Account.
(d) Application of Proceeds. Subject to subsection (c) immediately
above, the cash proceeds actually received from the sale or
other disposition or collection of Collateral, and any other
amounts received in respect of the Collateral the application of
which is not otherwise provided for herein, shall be applied
(after payment of any amounts payable to the Agent pursuant to
Section 8 or Section 14) in whole or in part by the Agent for
the benefit of the Lender Parties against all or any part of the
Secured Obligations in the following order: (i) first, to any
fees, costs, or other expenses due under the Loan Documents;
(ii) next, to any interest (including interest due under
subsection 2.07(c) of the Credit Agreement; (iii) next, to any
principal due under the Loan Documents; and (iv) last, to any
other Secured Obligations. Any surplus thereof which exists
after payment and performance in full of the Secured Obligations
shall be promptly paid over to Grantors or otherwise disposed of
in accordance with the UCC or other applicable law. Grantors
shall remain liable to the Agent for any deficiency which exists
after any sale or other disposition or collection of Collateral.
(e) Agreement to Execute and Deliver Documents. Upon the exercise by
the Agent of any power, right, privilege, or remedy pursuant to
this Agreement which requires any consent, approval,
registration, qualification, or authorization of any
Governmental Authority, Grantors agree to execute and deliver,
or will cause the execution and delivery of, all applications,
certificates, instruments, assignments, and other documents and
papers that the Agent or any purchaser of the Collateral may be
required to obtain for such governmental consent, approval,
registration, qualification, or authorization.
(f) Stipulation re: Receiver. Grantors hereby irrevocably stipulate
and agree that the Agent has the right under this Agreement,
upon the occurrence and during the
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continuance of an Event of Default, to seek the appointment of a
receiver, trustee, or similar official over Grantors to effect
the transactions contemplated by this Agreement. Grantors hereby
irrevocably agree not to object to such appointment on any
grounds.
(g) Particular Remedies re: Equity Interests.
(i) During the continuance of an Event of Default, at the Agent's
option, and in addition to any and all other rights and remedies
available to the Agent pursuant to this Agreement, the other
Loan Documents, at law, or otherwise, Grantors shall cooperate
with the Agent in having Grantors' respective Equity Interests
in all Guarantors transferred to the Agent or its designee in
accordance with the applicable Organization Documents and in
each Guarantor's respective records;
(ii) During the continuance of an Event of Default, the Agent may,
without notice of election and without demand, do any one or
more of the following, all of which Grantors authorize and agree
are commercially reasonable:
(1) notify Grantors that the Agent has the absolute and
unconditional right to receive any and all payments of any kind
whatsoever to be made by or payable by a Grantor to one or more
Guarantors, whether as the holder of an Equity Interest in such
Guarantors or as creditor thereof, including without limitation
the Assigned Benefits;
(2) receive payment of the Assigned Benefits directly from
Guarantors, or otherwise collect the Assigned Benefits, or
transfer the right to receive the Assigned Benefits, without
recourse to the security interest granted hereby. Grantors
hereby authorize and instruct all Guarantors in which they hold
an Equity Interest to pay all of the Assigned Benefits directly
to the Agent from time to time as the same shall become due,
from and after receipt by Guarantors of written demand from the
Agent;
(3) to exercise all of Grantors' respective voting and other rights
as the holder of an Equity Interest in Guarantors (whether or
not transferred to the Agent) and give all consents, waivers,
and ratifications in respect of the Equity Interests and
otherwise act with respect thereto as though it were the
outright owner thereof; GRANTORS HEREBY IRREVOCABLY CONSTITUTE
AND APPOINT THE AGENT THE PROXY AND ATTORNEY-IN-FACT OF
GRANTORS, COUPLED WITH AN INTEREST, WITH FULL POWER OF
SUBSTITUTION FOR ANY AND ALL OF SUCH PURPOSES; WHICH PROXY AND
POWER OF ATTORNEY SHALL CONTINUE IN FULL FORCE AND EFFECT AND
TERMINATE UPON THE EARLIER TO OCCUR OF (A) THE INDEFEASIBLE
PAYMENT IN FULL OF THE SECURED OBLIGATIONS, AND (B) TWELVE (12)
YEARS FROM THE DATE HEREOF.
35. Certain Waivers. Grantors waive, to the fullest extent permitted by
law, (i) any right of redemption with respect to the Collateral, whether before
or after sale hereunder, and all rights, if any, of marshalling of the
Collateral or other collateral or security for the Secured Obligations; (ii) any
right to require the Agent (A) to proceed against any Person, (B) to exhaust any
other collateral or security for any of the Secured Obligations, (C) to pursue
any remedy in
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the Agent's power, or (D) to make or give any presentments, demands for
performance, notices of nonperformance, protests, notices of protests, or
notices of dishonor in connection with any of the Collateral; and (iii) all
claims, damages, and demands against the Agent arising out of the repossession,
retention, sale, or application of the proceeds of any sale of the Collateral.
36. Notices. All notices or other communications hereunder shall be
given in the manner and to the addresses specified in the Credit Agreement. All
such notices and other communications shall be effective (i) if delivered by
hand or pre-paid courier service, when delivered; (ii) if sent by mail, upon the
earlier of the date of receipt or five Business Days after deposit in the mail,
first class, postage prepaid; (iii) if sent by telex, upon receipt by the sender
of an appropriate answer back; and (iv) if sent by facsimile transmission, when
sent.
37. No Waiver; Cumulative Remedies. No failure on the part of the Agent
to exercise, and no delay in exercising, any right, remedy, power, or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right, remedy, power or privilege preclude any other or
further exercise thereof or the exercise of any other right, remedy, power, or
privilege. The rights and remedies under this Agreement are cumulative and not
exclusive of any rights, remedies, powers, and privileges that may otherwise be
available to the Agent.
38. Costs and Expenses; Indemnification; Other Charges.
(a) Costs and Expenses. Grantors agree to pay on demand:
(i) the reasonable out-of-pocket costs and expenses of the Agent and
any of its Affiliates, and the Agent's reasonable Attorney
Costs, in connection with the negotiation, preparation,
execution, delivery, and administration of this Agreement, and
any amendments, modifications, or waivers of the terms thereof,
and the custody of the Collateral;
(ii) upon the occurrence and during the continuance of an Event of
Default, all title, appraisal (including the allocated costs of
internal appraisal services), survey, audit, consulting, search,
recording, filing, and similar costs, fees, and expenses
incurred or sustained by the Agent or any of its Affiliates in
connection with this Agreement or the Collateral; and
(iii) all reasonable costs and expenses of the Agent and its
Affiliates, including Attorney Costs, in connection with the
enforcement of, and preservation of any rights or interests
under, this Agreement, including in any out-of-court workout or
other refinancing or restructuring or in any bankruptcy case,
and the protection, storing, warehousing, insuring, sale, or
collection of, or other realization upon, any of the Collateral,
including all expenses of taking, collecting, holding, sorting,
handling, preparing for sale, selling, or the like, and other
such expenses of sales and collections of Collateral, and any
and all losses, costs, and expenses sustained by the Agent as a
result of any failure by Grantors to perform or observe their
obligations contained herein.
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(b) Indemnification. Grantors hereby agree to indemnify the Agent,
the other Lender Parties, any Affiliate of any of them, and
their respective directors, officers, employees, agents,
counsel, and other advisors (each an "Indemnified Person")
against, and hold each of them harmless from, any and all
liabilities, obligations, losses, claims, damages, penalties,
actions, judgments, suits, costs, expenses, or disbursements of
any kind or nature whatsoever, including the reasonable fees and
disbursements of counsel to an Indemnified Person (including
reasonable allocated costs of internal counsel), which may be
imposed on, incurred by, or asserted against any Indemnified
Person, in any way relating to or arising out of this Agreement
or the transactions contemplated hereby or any action taken or
omitted to be taken by it hereunder (the "Indemnified
Liabilities"); provided that Grantors shall not be liable to any
Indemnified Person for any portion of such Indemnified
Liabilities arising from such Indemnified Person's gross
negligence or willful misconduct. If and to the extent that the
foregoing indemnification is for any reason held unenforceable,
Grantors agree to make the maximum contribution to the payment
and satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law.
(c) Other Charges. Grantors agree to indemnify the Agent against and
hold it harmless from any and all present and future stamp,
transfer, documentary, and other such taxes, levies, fees,
assessments, and other charges made by any jurisdiction by
reason of the execution, delivery, performance, and enforcement
of this Agreement.
(d) Interest. Any amounts payable to the Agent under this Section 14
or otherwise under this Agreement if not paid upon demand shall
bear interest from the date of such demand until paid in full,
at the rate of interest set forth in subsection 2.07(c) of the
Credit Agreement.
39. Binding Effect. This Agreement shall be binding upon, inure to the
benefit of and be enforceable by Grantors, the Agent, and their respective
successors and assigns.
40. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF CALIFORNIA, EXCEPT AS
REQUIRED BY MANDATORY PROVISIONS OF LAW AND TO THE EXTENT THE VALIDITY OR
PERFECTION OF THE SECURITY INTERESTS HEREUNDER, OR THE REMEDIES HEREUNDER, IN
RESPECT OF ANY COLLATERAL ARE GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN
CALIFORNIA, PROVIDED THAT THE PARTIES SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.
41. Entire Agreement; Amendment. This Agreement contains the entire
agreement of the parties with respect to the subject matter hereof and shall not
be amended except by the written agreement of the parties as provided in the
Credit Agreement.
42. Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under all
applicable laws and regulations. If, however, any provision of this Agreement
shall be prohibited by or invalid under any such law or regulation in any
jurisdiction, it shall, as to such jurisdiction, be deemed modified to
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26
conform to the minimum requirements of such law or regulation, or, if for any
reason it is not deemed so modified, it shall be ineffective and invalid only to
the extent of such prohibition or invalidity without affecting the remaining
provisions of this Agreement, or the validity or effectiveness of such provision
in any other jurisdiction.
43. Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute but one and the same agreement.
44. Incorporation of Provisions of the Credit Agreement. To the extent
the Credit Agreement contains provisions of general applicability to the Loan
Documents, including any such provisions contained in Article XI thereof, such
provisions are incorporated herein by this reference.
45. No Inconsistent Requirements. Grantors acknowledge that this
Agreement and the other Loan Documents may contain covenants and other terms and
provisions variously stated regarding the same or similar matters, and agrees
that all such covenants, terms, and provisions are cumulative and all shall be
performed and satisfied in accordance with their respective terms.
46. Termination. Upon termination of the Commitments of the Lenders
under the Loan Documents and payment in full of all Secured Obligations, the
security interests granted under this Agreement shall terminate and the Agent
shall promptly execute and deliver to Grantors such documents and instruments
reasonably requested by Grantors as shall be necessary to evidence termination
of all security interests given by Grantors to the Agent hereunder; provided
that the obligations of Grantors under Section 14 shall survive such
termination.
47. Additional Grantors. Each Grantor party hereto consents to the
addition of other Persons as Grantors hereunder pursuant to Section 6.13 of the
Credit Agreement. Upon any Person becoming a Grantor hereunder after the Closing
Date, such Person shall forthwith provide to the Agent all information relating
to such Person of the nature set forth in Schedule 1 hereto.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement, as of the date first above written.
GRANTORS: CENTRAL CONSUMER FINANCE COMPANY, a
Delaware corporation
By /S/
---------------------------------------
Name: Xxxx Xxxxxx
Title: President
Address for Notices:
Attn: Xxxx Xxxxxx
0000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Telephone: 000.000.0000
Facsimile: 323.720.8729
CENTRAL CHECK CASHING INC., a
California corporation
By /S/
--------------------------------------
Name: Xxxx Xxxxxx
Title: President
Address for Notices:
Attn: Xxxx Xxxxxx
0000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Telephone: 000.000.0000
Facsimile: 323.720.8729
CENTRAL CONSUMER COMPANY OF NEVADA, a
Nevada corporation
By /S/
--------------------------------------
Name: Xxxx Xxxxxx
Title: President
Address for Notices:
Attn: Xxxx Xxxxxx
0000 Xxxx Xxxxxxxx Xxxxx
-00-
00
Xxxxxxxx, XX 00000
Telephone: 000.000.0000
Facsimile: 323.720.8729
AGENT:
UNION BANK OF CALIFORNIA, N.A.
By /S/
--------------------------------------
Name: Xxxxxx X. Xxxxx
Title: President
Address for Notices:
Notices (other than
Requests for Extensions of
Credit):
Attn: Xxxxxx X. Xxxxx
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Telephone: 000.000.0000
Facsimile: 415.705.5093
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