Exhibit 10.8
EXECUTION COPY
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GUARANTEE, COLLATERAL AND INTERCREDITOR AGREEMENT
dated as of
November 30, 2005,
among
NETWORK COMMUNICATIONS, INC.,
GALLARUS MEDIA HOLDINGS, INC.,
the Subsidiaries of NETWORK COMMUNICATIONS, INC.,
from time to time party hereto,
CREDIT SUISSE,
as Collateral Agent,
CREDIT SUISSE,
as Revolving Loan Administrative Agent
and
CREDIT SUISSE,
as Term Loan Administrative Agent
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[CS&M Ref No. 5865-363]
TABLE OF CONTENTS
Page
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ARTICLE I
Definitions.............................................................. 2
SECTION 1.01. Credit Agreements...................................... 2
SECTION 1.02. Other Defined Terms.................................... 2
SECTION 1.03. Extensions............................................. 10
ARTICLE II
Guarantee................................................................ 10
SECTION 2.01. Guarantee.............................................. 10
SECTION 2.02. Guarantee of Payment................................... 10
SECTION 2.03. No Limitations, Etc.................................... 11
SECTION 2.04. Reinstatement.......................................... 12
SECTION 2.05. Agreement To Pay; Subrogation.......................... 12
SECTION 2.06. Information............................................ 12
ARTICLE III
Pledge of Securities..................................................... 12
SECTION 3.01. Pledge................................................. 12
SECTION 3.02. Delivery of the Pledged Collateral..................... 13
SECTION 3.03. Representations, Warranties and Covenants.............. 13
SECTION 3.04. Certification of Limited Liability Company Interests
and Limited Partnership Interests...................... 15
SECTION 3.05. Registration in Nominee Name; Denominations............ 15
SECTION 3.06. Voting Rights; Dividends and Interest, Etc............. 15
ARTICLE IV
Security Interests in Personal Property.................................. 17
SECTION 4.01. Security Interest...................................... 17
SECTION 4.02. Representations and Warranties......................... 19
SECTION 4.03. Covenants.............................................. 21
SECTION 4.04. Other Actions.......................................... 25
SECTION 4.05. Covenants Regarding Patent, Trademark and Copyright
Collateral............................................. 28
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ARTICLE V
Remedies................................................................. 29
SECTION 5.01. Remedies Upon Default.................................. 29
SECTION 5.02. Application of Proceeds................................ 31
SECTION 5.03. Grant of License to Use Intellectual Property.......... 32
SECTION 5.04. Securities Act, Etc.................................... 32
SECTION 5.05. Provisions Relating to Cash Collateralization of L/C
Exposure Under Revolving Loan Credit Agreement......... 33
ARTICLE VI
Acts of Secured Parties and Agents; Notices of Default and Acceleration.. 33
SECTION 6.01. Acts of Secured Parties and Agents..................... 33
SECTION 6.02. Determination of Existence of Events of Default and
Acceleration; Notices to Agents........................ 34
ARTICLE VII
Certain Intercreditor Provisions......................................... 35
SECTION 7.01. Actions Under This Agreement........................... 35
SECTION 7.02. Restrictions on Actions................................ 35
SECTION 7.03. Cooperation; Accountings............................... 36
SECTION 7.04. Other Collateral....................................... 36
SECTION 7.05. Preferential Payments and Special Trust Account........ 36
SECTION 7.06. Restoration of Obligations............................. 37
SECTION 7.07. Bankruptcy Preferences................................. 37
SECTION 7.08. Bankruptcy Proceedings................................. 37
ARTICLE VIII
Concerning the Collateral Agent.......................................... 38
SECTION 8.01. Appointment of Collateral Agent........................ 38
SECTION 8.02. Limitations on Responsibility of Collateral Agent...... 38
SECTION 8.03. Reliance by Collateral Agent; Indemnity Against
Liabilities, etc....................................... 39
SECTION 8.04. Resignation of the Collateral Agent.................... 39
SECTION 8.05. Determination of Amounts of Obligations................ 40
SECTION 8.06. Authorized Investments................................. 40
SECTION 8.07. Certain Powers Relating to Collateral.................. 41
ARTICLE IX
Representations and Warranties........................................... 41
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ARTICLE X
Indemnity, Subrogation and Subordination................................. 42
SECTION 10.01. Indemnity and Subrogation.............................. 42
SECTION 10.02. Contribution and Subrogation........................... 42
SECTION 10.03. Subordination.......................................... 42
ARTICLE XI
Miscellaneous............................................................ 43
SECTION 11.01. Notices................................................ 43
SECTION 11.02. Security Interest Absolute............................. 43
SECTION 11.03. Survival of Agreement.................................. 43
SECTION 11.04. Binding Effect; Several Agreement...................... 43
SECTION 11.05. Successors and Assigns................................. 44
SECTION 11.06. Collateral Agent's Fees and Expenses; Indemnification.. 44
SECTION 11.07. Collateral Agent Appointed Attorney-in-Fact............ 45
SECTION 11.08. Applicable Law......................................... 46
SECTION 11.09. Waivers; Amendment..................................... 46
SECTION 11.10. WAIVER OF JURY TRIAL................................... 46
SECTION 11.11. Severability........................................... 47
SECTION 11.12. Counterparts........................................... 47
SECTION 11.13. Headings............................................... 47
SECTION 11.14. Jurisdiction; Consent to Service of Process............ 47
SECTION 11.15. Termination or Release................................. 48
SECTION 11.16. Additional Subsidiaries................................ 48
SECTION 11.17. Right of Setoff........................................ 49
Schedules
Schedule I Guarantors
Schedule II Equity Interests; Pledged Debt Securities
Schedule III Intellectual Property
Exhibits
Exhibit A Form of Supplement
Exhibit B Form of Perfection Certificate
GUARANTEE, COLLATERAL AND INTERCREDITOR AGREEMENT dated as
of November 30, 2005 (this "AGREEMENT"), among NETWORK
COMMUNICATIONS, INC., a Georgia corporation (the "BORROWER"),
GALLARUS MEDIA HOLDINGS, INC., a Delaware corporation
("HOLDINGS"), the Subsidiaries of the Borrower from time to time
party hereto, CREDIT SUISSE, as collateral agent for the Secured
Parties (as defined below) (in such capacity, the "COLLATERAL
AGENT"), CREDIT SUISSE, as administrative agent for the Revolving
Lenders (as defined below) (in such capacity, the "REVOLVING LOAN
ADMINISTRATIVE AGENT") and CREDIT SUISSE, as administrative agent
for the Term Lenders (as defined below) (in such capacity, the
"TERM LOAN ADMINISTRATIVE AGENT" and, together with the Revolving
Loan Administrative Agent, the "ADMINISTRATIVE AGENTS").
PRELIMINARY STATEMENT
Reference is made to (a) the Revolving Loan Credit Agreement dated as
of November 30, 2005 (as amended, restated, supplemented or otherwise modified
from time to time, the "REVOLVING LOAN CREDIT AGREEMENT"), among the Borrower,
Holdings, the lenders from time to time party thereto (the "REVOLVING LENDERS"),
the Revolving Loan Administrative Agent and the Collateral Agent, and (b) the
Term Loan Credit Agreement dated as of November 30, 2005 (as amended, restated,
supplemented or otherwise modified from time to time, the "TERM LOAN CREDIT
AGREEMENT" and, together with the Revolving Loan Credit Agreement, the "CREDIT
AGREEMENTS"), among the Borrower, Holdings, the lenders from time to time party
thereto (the "TERM LENDERS" and, together with the Revolving Lenders, the
"LENDERS"), the Term Loan Administrative Agent and the Collateral Agent.
The Revolving Lenders and the Issuing Bank have agreed to extend
credit to the Borrower subject to the terms and conditions set forth in the
Revolving Loan Credit Agreement, and the Term Lenders have agreed to make term
loans to the Borrower subject to the terms and conditions set forth in the Term
Loan Credit Agreement. The obligations of the Lenders and the Issuing Bank to
extend such credit are conditioned upon, among other things, the execution and
delivery of this Agreement. Each Guarantor is an affiliate of the Borrower, will
derive substantial benefits from the extension of credit to the Borrower
pursuant to the Credit Agreements and is willing to execute and deliver this
Agreement in order to induce the Lenders and the Issuing Bank to extend such
credit. Accordingly, the parties hereto agree as follows:
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ARTICLE I
DEFINITIONS
SECTION 1.01. CREDIT AGREEMENTS. (a) Capitalized terms used in this
Agreement and not otherwise defined herein have the meanings set forth in the
applicable Credit Agreement. All capitalized terms defined in the New York UCC
(as defined herein) and not defined in this Agreement have the meanings
specified therein. All references to the Uniform Commercial Code shall mean the
New York UCC.
(b) The rules of construction specified in Section 1.02 of each Credit
Agreement also apply to this Agreement.
SECTION 1.02. OTHER DEFINED TERMS. As used in this Agreement, the
following terms have the meanings specified below:
"ACCOUNT DEBTOR" shall mean any person who is or who may become
obligated to any Grantor under, with respect to or on account of an Account
Receivable.
"ACCOUNTS RECEIVABLE" shall mean all Accounts and all right, title and
interest in any returned goods, together with all rights, titles, securities and
guarantees with respect thereto, including any rights to stoppage in transit,
replevin, reclamation and resales, and all related security interests, liens and
pledges, whether voluntary or involuntary, in each case whether now existing or
owned or hereafter arising or acquired.
"ACT" shall have the meaning assigned to such term in Section 6.01.
"ADMINISTRATIVE AGENTS" shall have the meaning assigned to such term
in the preamble.
"AGREEMENT" shall have the meaning assigned to such term in the
preamble.
"ARTICLE 9 COLLATERAL" shall have the meaning assigned to such term in
Section 4.01.
"BANKRUPTCY PROCEEDING" shall mean, with respect to any person, a
general assignment by such person for the benefit of its creditors, or the
institution by or against such person of any proceeding seeking relief as
debtor, or seeking to adjudicate such person as bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment or composition of such person or
its debts, under any law relating to bankruptcy, insolvency, reorganization or
relief of debtors generally, or seeking appointment of a receiver, trustee,
custodian or other similar official for such person or for any substantial part
of its property.
"BORROWER" shall have the meaning assigned to such term in the
preamble.
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"CASH EQUIVALENT INVESTMENTS" shall mean (a) direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States of America (or by any agency thereof to the
extent such obligations are backed by the full faith and credit of the United
States of America), in each case maturing within 1 year from the date of
acquisition thereof, (b) investments in tax-exempt obligations of any State of
the United States of America, or any municipality of any such State, maturing
within 30 days from the date of acquisition thereof and having, at such date of
acquisition, one of the two highest credit ratings obtainable from S&P or from
Xxxxx'x, (c) investments in commercial paper maturing within 60 days from the
date of acquisition thereof and having, at such date of acquisition, one of the
two highest credit ratings obtainable from S&P or from Xxxxx'x, (d) investments
in certificates of deposit, banker's acceptances, demand deposit accounts and
time deposits maturing within 60 days from the date of acquisition thereof
issued or guaranteed by or placed with, and money market deposit accounts issued
or offered by, the Collateral Agent or any domestic office of any commercial
bank organized under the laws of the United States of America or any State
thereof that has a combined capital and surplus and undivided profits of not
less than $500,000,000, (e) fully collateralized repurchase agreements with a
term of not more than 30 days for securities described in clause (a) above and
entered into with a financial institution satisfying the criteria of clause (d)
above, (f) investments in "money market funds" within the meaning of Rule 2a-7
of the Investment Company Act of 1940, as amended, substantially all of whose
assets are invested in investments of the type described in clauses (a) through
(e) above, and (g) investments in so-called "auction rate" securities rated AAA
or higher by S&P or Aaa or higher by Xxxxx'x and which have a reset date not
more than 90 days from the date of acquisition thereof.
"CLAIMING GUARANTOR" shall have the meaning assigned to such term in
Section 10.02.
"COLLATERAL" shall mean the Article 9 Collateral, the Pledged
Collateral and all amounts received by any Secured Party pursuant to Section
11.17.
"COLLATERAL AGENT" shall have the meaning assigned to such term in the
preamble.
"CONTRIBUTING GUARANTOR" shall have the meaning assigned to such term
in Section 10.02.
"COPYRIGHT LICENSE" shall mean any written agreement, now or hereafter
in effect, granting any right to any third person under any copyright now or
hereafter owned by any Grantor or that such Grantor otherwise has the right to
license, or granting any right to any Grantor under any copyright now or
hereafter owned by any third person, and all rights of such Grantor under any
such agreement.
"COPYRIGHTS" shall mean all of the following now owned or hereafter
acquired by any Grantor: (a) all copyright rights in any work subject to the
copyright laws of the United States or any other country, whether as author,
assignee, transferee or otherwise, and (b) all registrations and applications
for registration of any such copyright
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in the United States or any other country, including registrations, recordings,
supplemental registrations and pending applications for registration in the
United States Copyright Office (or any successor office or any similar office in
any other country), including those listed on Schedule III.
"CREDIT AGREEMENTS" shall have the meaning assigned to such term in
the preliminary statement.
"EQUITY INTERESTS" shall mean shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity interests in any person.
"EVENT OF DEFAULT" shall mean a Revolving Loan Event of Default or a
Term Loan Event of Default.
"FEDERAL SECURITIES LAWS" shall have the meaning assigned to such term
in Section 5.04.
"GENERAL INTANGIBLES" shall mean all choses in action and causes of
action and all other intangible personal property of any Grantor of every kind
and nature (other than Accounts) now owned or hereafter acquired by any Grantor,
including all rights and interests in partnerships, limited partnerships,
limited liability companies and other unincorporated entities, corporate or
other business records, indemnification claims, contract rights (including
rights under leases, whether entered into as lessor or lessee, Hedging
Agreements and other agreements), Intellectual Property, goodwill,
registrations, franchises, tax refund claims and any letter of credit,
guarantee, claim, security interest or other security held by or granted to any
Grantor to secure payment by an Account Debtor of any of the Accounts.
"GRANTORS" shall mean the Borrower and the Guarantors.
"GUARANTORS" shall mean (a) Holdings and (b) each Subsidiary that
becomes a party to this Agreement as a Guarantor after the Closing Date.
"HOLDINGS" shall have the meaning assigned to such term in the
preamble.
"INTELLECTUAL PROPERTY" shall mean all intellectual and similar
property of any Grantor of every kind and nature now owned or hereafter acquired
by any Grantor, including inventions, designs, Patents, Copyrights, Licenses,
Trademarks, trade secrets, confidential or proprietary technical and business
information, know-how, show-how or other data or information, software and
databases and all embodiments or fixations thereof and related documentation and
registrations, and all additions, improvements and accessions to, and books and
records describing or used in connection with, any of the foregoing.
"ISSUING BANK" shall have the meaning assigned to such term in the
Revolving Loan Credit Agreement.
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"LENDERS" shall have the meaning assigned to such term in the
preliminary statement.
"LICENSE" shall mean any Patent License, Trademark License, Copyright
License or other license or sublicense agreement to which any Grantor is a
party, including those material Licenses listed on Schedule III.
"LOAN DOCUMENTS" shall mean the Revolving Loan Documents and the Term
Loan Documents.
"LOANS" shall mean the Revolving Loans and the Term Loans.
"LOAN DOCUMENT OBLIGATIONS" shall mean the Revolving Loan Document
Obligations and the Term Loan Document Obligations.
"MAJORITY SECURED PARTIES" shall mean Lenders, considered as a single
class, holding more than 50% of the sum of (a) the aggregate amount of the
Revolving Loan Exposures of all Revolving Lenders and (b) the aggregate amount
of the Term Loan Exposures of all Term Lenders; provided that for purposes of
determining the Majority Secured Parties, any Revolving Loan Exposures and any
Term Loan Exposures then owned by the Borrower or its Affiliates shall be
disregarded.
"NEW YORK UCC" shall mean the Uniform Commercial Code as from time to
time in effect in the State of New York.
"NOTICE OF DEFAULT" shall have the meaning assigned to such term in
Section 6.02.
"OBLIGATIONS" shall mean the Revolving Loan Obligations, the Term Loan
Obligations and all monetary obligations of the Grantors to the Collateral Agent
hereunder or under the other Security Documents.
"PATENT LICENSE" shall mean any written agreement, now or hereafter in
effect, granting to any third person any right to make, use or sell any
invention on which a patent, now or hereafter owned by any Grantor or that any
Grantor otherwise has the right to license, is in existence, or granting to any
Grantor any right to make, use or sell any invention on which a patent, now or
hereafter owned by any third person, is in existence, and all rights of any
Grantor under any such agreement.
"PATENTS" shall mean all of the following now owned or hereafter
acquired by any Grantor: (a) all letters patent of the United States or the
equivalent thereof in any other country, all registrations and recordings
thereof, and all applications for letters patent of the United States or the
equivalent thereof in any other country, including registrations, recordings and
pending applications in the United States Patent and Trademark Office (or any
successor or any similar offices in any other country), including those listed
on Schedule III, and (b) all reissues, continuations, divisions,
continuations-in-part, renewals or extensions thereof, and the inventions
claimed therein, including the right to make, use and/or sell the inventions
claimed therein.
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"PERFECTION CERTIFICATE" shall mean a certificate substantially in the
form of Exhibit B, completed and supplemented with the schedules and attachments
contemplated thereby, and duly executed by a Responsible Officer of the
Borrower.
"PLEDGED COLLATERAL" shall have the meaning assigned to such term in
Section 3.01.
"PLEDGED DEBT SECURITIES" shall have the meaning assigned to such term
in Section 3.01.
"PLEDGED EQUITY INTERESTS" shall have the meaning assigned to such
term in Section 3.01.
"PLEDGED SECURITIES" shall mean any promissory notes, stock
certificates or other securities now or hereafter included in the Pledged
Collateral, including all certificates, instruments or other documents
representing or evidencing any Pledged Collateral.
"PREFERENTIAL PAYMENT" shall mean any payment (including any deposit
of cash collateral) obtained by a Secured Party or its Affiliates in respect of
Obligations held by it, whether in cash, securities or property, through the
exercise of any remedy (including the commencement and prosecution of any
litigation and the exercise of any right of setoff or right to demand cash
collateral) available to such Secured Party as a result of the occurrence and
continuance of any Event of Default; provided, that no payment made to a Secured
Party pursuant to Section 5.02 or received by any Secured Party in any
Bankruptcy Proceeding pursuant to a plan of reorganization or other action
approved in writing by the Majority Secured Parties shall constitute a
Preferential Payment.
"REVOLVING LENDERS" shall have the meaning assigned to such term in
the preliminary statement.
"REVOLVING LOAN ADMINISTRATIVE AGENT" shall have the meaning assigned
to such term in the preamble.
"REVOLVING LOAN CREDIT AGREEMENT" shall have the meaning assigned to
such term in the preliminary statement.
"REVOLVING LOAN DEFAULT" shall mean any "Default" as defined in the
Revolving Loan Credit Agreement.
"REVOLVING LOAN DOCUMENTS" shall mean the "Loan Documents" as defined
in the Revolving Loan Credit Agreement.
"REVOLVING LOAN EVENT OF DEFAULT" shall mean any "Event of Default" as
defined in the Revolving Loan Credit Agreement.
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"REVOLVING LOAN EXPOSURE" shall mean, as of any date of determination,
for any Revolving Lender, (a) if no Revolving Loan Default or Revolving Loan
Event of Default shall exist, the sum of (i) such Revolving Lender's Pro Rata
Percentage of the aggregate amount of outstanding Revolving Loans (excluding
Swingline Loans), (ii) such Lender's Pro Rata Percentage of the L/C Exposure,
(iii) such Lender's Pro Rata Percentage of the Swingline Exposure and (iv) such
Lender's Pro Rata Percentage of the aggregate amount of unused Revolving Credit
Commitments, or (b) if a Revolving Loan Default or Revolving Loan Event of
Default shall exist, the sum of (i) such Revolving Lender's Pro Rata Percentage
of the aggregate amount of outstanding Revolving Loans (excluding Swingline
Loans), (ii) such Lender's Pro Rata Percentage of the L/C Exposure and (iii)
such Lender's Pro Rata Percentage of the Swingline Exposure.
"REVOLVING LOAN OBLIGATIONS" shall mean (a) the due and punctual
payment by the Borrower of (i) the principal of and interest (including interest
accruing during the pendency of any Bankruptcy Proceeding, regardless of whether
allowed or allowable in such proceeding) on the Revolving Loans, when and as
due, whether at maturity, by acceleration, upon one or more dates set for
prepayment or otherwise, (ii) each payment required to be made under the
Revolving Loan Credit Agreement in respect of any Letter of Credit, when and as
due, including payments in respect of reimbursement of L/C Disbursements,
interest thereon (including interest accruing during the pendency of any
Bankruptcy Proceeding, regardless of whether allowed or allowable in such
proceeding) and obligations to provide cash collateral, and (iii) all other
monetary obligations of the Borrower to any of the Revolving Loan Secured
Parties under the Revolving Loan Credit Agreement and each of the other
Revolving Loan Documents, including obligations to pay fees, expense
reimbursement obligations and indemnification obligations, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any Bankruptcy Proceeding,
regardless of whether allowed or allowable in such proceeding), (b) the due and
punctual payment of all the monetary obligations of each other Grantor to any
Revolving Loan Secured Party under or pursuant to the Revolving Loan Credit
Agreement and each of the other Revolving Loan Documents, (c) the due and
punctual payment and performance of all monetary obligations of each Grantor
under each Hedging Agreement that (i) is in effect on the Closing Date with a
counterparty that is a Revolving Lender or an Affiliate of a Revolving Lender as
of the Closing Date or (ii) is entered into after the Closing Date with any
counterparty that is a Revolving Lender or an Affiliate of a Revolving Lender at
the time such Hedging Agreement is entered into and (d) the due and punctual
payment and performance of all obligations of the Borrower to a Revolving Lender
or an Affiliate of a Revolving Lender in respect of cash management services
(other than cash management services provided after (i) the principal of and
interest on each Revolving Loan and all fees payable under the Revolving Loan
Credit Agreement have been paid in full, (ii) the Revolving Lenders have no
further commitment to lend under the Revolving Loan Credit Agreement, (iii) the
L/C Exposure has been reduced to zero and (iv) the Issuing Bank under the
Revolving Loan Credit Agreement has no further obligation to issue Letters of
Credit under the Revolving Loan Credit Agreement), including obligations in
respect of overdrafts, temporary advances, interest and fees.
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"REVOLVING LOANS" shall mean the "Loans" as defined in the Revolving
Loan Credit Agreement.
"REVOLVING LOAN SECURED PARTIES" shall mean (a) the Revolving Lenders,
(b) the Revolving Loan Administrative Agent, (c) the Collateral Agent, (d) any
Issuing Bank, (e) each counterparty to any Hedging Agreement with a Grantor that
either (i) is in effect on the Closing Date if such counterparty is a Revolving
Lender or an Affiliate of a Revolving Lender as of the Closing Date or (ii) is
entered into after the Closing Date if such counterparty is a Revolving Lender
or an Affiliate of a Revolving Lender at the time such Hedging Agreement is
entered into, (f) the beneficiaries of each indemnification obligation
undertaken by any Grantor under any Revolving Loan Document and (g) the
successors and assigns of each of the foregoing.
"SECURED PARTIES" shall mean the collective reference to the Revolving
Loan Secured Parties and the Term Loan Secured Parties.
"SECURITY DOCUMENTS" shall mean this Agreement and each of the other
security agreements, mortgages or other instruments and documents pursuant to
which a Lien is granted to secure any Obligations or under which rights or
remedies with respect to any such Lien are governed.
"SECURITY INTEREST" shall have the meaning assigned to such term in
Section 4.01.
"SPECIAL TRUST ACCOUNT" shall mean an interest-bearing restricted
account maintained by the Collateral Agent for the benefit of the Secured
Parties for the purpose of receiving and holding Preferential Payments and
payments under Sections 3.06(b) and 7.05.
"TERM LENDERS" shall have the meaning assigned to such term in the
preliminary statement.
"TERM LOAN ADMINISTRATIVE AGENT" shall have the meaning assigned to
such term in the preamble.
"TERM LOAN CREDIT AGREEMENT" shall have the meaning assigned to such
term in the preliminary statement.
"TERM LOAN DOCUMENTS" shall mean the "Loan Documents" as defined in
the Term Loan Credit Agreement.
"TERM LOAN EVENT OF DEFAULT" shall mean any "Event of Default" as
defined in the Term Loan Credit Agreement.
"TERM LOAN EXPOSURE" shall mean, as of any date of determination, for
any Term Lender, such Term Lender's Pro Rata Percentage of the aggregate amount
of outstanding Term Loans.
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"TERM LOAN OBLIGATIONS" shall mean (a) the due and punctual payment by
the Borrower of (i) the principal of and interest (including interest accruing
during the pendency of any Bankruptcy Proceeding, regardless of whether allowed
or allowable in such proceeding) on the Term Loans, when and as due, whether at
maturity, by acceleration, upon one or more dates set for prepayment or
otherwise and (ii) all other monetary obligations of the Borrower to any of the
Term Loan Secured Parties under the Term Loan Credit Agreement and each of the
other Term Loan Documents, including obligations to pay fees, expense
reimbursement obligations and indemnification obligations, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any Bankruptcy Proceeding,
regardless of whether allowed or allowable in such proceeding), (b) the due and
punctual payment of all the monetary obligations of each other Grantor to any of
the Term Loan Secured Parties under or pursuant to the Term Loan Credit
Agreement and each of the other Term Loan Documents and (c) the due and punctual
payment and performance of all obligations of the Borrower to a Term Lender or
an Affiliate of a Term Lender in respect of cash management services (other than
cash management services provided after (i) the principal of and interest on
each Term Loan and all fees payable under the Term Loan Credit Agreement have
been paid in full and (ii) the Term Lenders have no further commitment to lend
under the Term Loan Credit Agreement), including obligations in respect of
overdrafts, temporary advances, interest and fees.
"TERM LOANS" shall mean the "Loans" as defined in the Term Loan Credit
Agreement.
"TERM LOAN SECURED PARTIES" shall mean (a) the Term Lenders, (b) the
Term Loan Administrative Agent, (c) the Collateral Agent, (d) each counterparty
to any Hedging Agreement with a Grantor that either (i) is in effect on the
Closing Date if such counterparty is a Term Lender or an Affiliate of a Term
Lender as of the Closing Date or (ii) is entered into after the Closing Date if
such counterparty is a Term Lender or an Affiliate of a Term Lender at the time
such Hedging Agreement is entered into, (e) the beneficiaries of each
indemnification obligation undertaken by any Grantor under any Term Loan
Document and (f) the successors and assigns of each of the foregoing.
"TRADEMARK LICENSE" shall mean any written agreement, now or hereafter
in effect, granting to any third person any right to use any trademark now or
hereafter owned by any Grantor or that any Grantor otherwise has the right to
license, or granting to any Grantor any right to use any trademark now or
hereafter owned by any third person, and all rights of any Grantor under any
such agreement.
"TRADEMARKS" shall mean all of the following now owned or hereafter
acquired by any Grantor: (a) all trademarks, service marks, trade names,
corporate names, company names, business names, fictitious business names, trade
styles, trade dress, logos, other source or business identifiers, designs and
general intangibles of like nature, now existing or hereafter adopted or
acquired, all registrations and recordings thereof, and all registration and
recording applications filed in connection therewith, including registrations
and registration applications in the United States Patent and Trademark Office
(or any successor office) or any similar offices in any State of the United
States or
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any other country or any political subdivision thereof, and all extensions or
renewals thereof, including those listed on Schedule III, (b) all goodwill
associated therewith or symbolized thereby and (c) all other assets, rights and
interests that uniquely reflect or embody such goodwill, but excluding in all
cases any intent-to-use United States trademark application for which an
amendment to allege use or statement of use has not been filed under 15 U.S.C
Section 1051(c) or 15 U.S.C Section 1051(d), respectively, or, if filed, has not
been deemed in conformance with 15 U.S.C Section 1051(a) or examined and
accepted, respectively, by the United States Patent and Trademark Office.
"UNFUNDED ADVANCES/PARTICIPATIONS" shall mean (a) with respect to each
Administrative Agent, the aggregate amount, if any (i) made available to the
Borrower on the assumption that each Lender has made its portion of the
applicable Borrowing available to the Administrative Agents (as contemplated by
Section 2.02(d) of each Credit Agreement) and (ii) with respect to which a
corresponding amount shall not in fact have been returned to such Administrative
Agent by the Borrower or made available to such Administrative Agent by any such
Lender, (b) with respect to the Swingline Lender, the aggregate amount, if any,
of participations in respect of any outstanding Swingline Loan that shall not
have been funded by the Revolving Lenders in accordance with Section 2.21(e) of
the Revolving Loan Credit Agreement and (c) with respect to any Issuing Bank,
the aggregate amount, if any, of participations in respect of any outstanding
L/C Disbursement that shall not have been funded by the Revolving Lenders in
accordance with Sections 2.22(d) and 2.02(f) of the Revolving Loan Credit
Agreement.
SECTION 1.03. EXTENSIONS. The Collateral Agent may grant extensions of
time for the perfection of security interests in or the obtaining of title
insurance with respect to particular assets (including extensions beyond the
Closing Date for the perfection of security interests in the assets of the
Grantors on such date) where it determines that perfection cannot be
accomplished without undue effort or expense by the time or times at which it
would otherwise be required by the Loan Documents.
ARTICLE II
GUARANTEE
SECTION 2.01. GUARANTEE. Each Guarantor unconditionally guarantees,
jointly with the other Guarantors and severally, as a primary obligor and not
merely as a surety, the due and punctual payment and performance of the
Obligations. Each Guarantor further agrees that any of the Obligations may be
extended or renewed, in whole or in part, without notice to or further assent
from it, and that it will remain bound upon its guarantee notwithstanding any
extension or renewal of any Obligation. Each Guarantor waives presentment to,
demand of payment from and protest to the Borrower or any other Grantor of any
of the Obligations, and also waives notice of acceptance of its guarantee and
notice of protest for nonpayment.
SECTION 2.02. GUARANTEE OF PAYMENT. Each Guarantor further agrees that
its guarantee hereunder constitutes a guarantee of payment when due and not of
collection, and waives any right to require that any resort be had by the
Collateral Agent
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or any other Secured Party to any security held for the payment of the
Obligations or to any balance of any Deposit Account or credit on the books of
the Collateral Agent or any other Secured Party in favor of the Borrower or any
other person.
SECTION 2.03. NO LIMITATIONS, ETC. (a) Except for termination of a
Guarantor's obligations hereunder as expressly provided in Section 11.15, the
obligations of each Guarantor hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including any claim of
waiver, release, surrender, alteration or compromise, and shall not be subject
to any defense or setoff, counterclaim, recoupment or termination whatsoever by
reason of the invalidity, illegality or unenforceability of the Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations of
each Guarantor hereunder shall not be discharged or impaired or otherwise
affected by (i) the failure of the Collateral Agent or any other Secured Party
to assert any claim or demand or to enforce any right or remedy under the
provisions of any Loan Document or otherwise, (ii) any rescission, waiver,
amendment or modification of, or any release from any of the terms or provisions
of, any Loan Document or any other agreement, including with respect to any
other Guarantor under this Agreement, (iii) the release of, or any impairment of
or failure to perfect any Lien on or security interest in, any security held by
the Collateral Agent or any other Secured Party for the Obligations or any of
them, (iv) any default, failure or delay, willful or otherwise, in the
performance of the Obligations, or (v) any other act or omission that may or
might in any manner or to any extent vary the risk of any Guarantor or otherwise
operate as a discharge of any Guarantor as a matter of law or equity (other than
the indefeasible payment in full in cash of all the Obligations). Each Guarantor
expressly authorizes the Collateral Agent to take and hold security for the
payment and performance of the Obligations, to exchange, waive or release any or
all such security (with or without consideration), to enforce or apply such
security and direct the order and manner of any sale thereof in its sole
discretion or to release or substitute any one or more other guarantors or
obligors upon or in respect of the Obligations, all without affecting the
obligations of any Guarantor hereunder.
(b) To the fullest extent permitted by applicable law, each Guarantor
waives any defense based on or arising out of any defense of the Borrower or any
other Grantor or the unenforceability of the Obligations or any part thereof
from any cause, or the cessation from any cause of the liability of the Borrower
or any other Grantor, other than the indefeasible payment in full in cash of all
the Obligations. The Collateral Agent and the other Secured Parties may, at
their election, foreclose on any security held by one or more of them by one or
more judicial or nonjudicial sales, accept an assignment of any such security in
lieu of foreclosure, compromise or adjust any part of the Obligations, make any
other accommodation with the Borrower or any other Grantor or exercise any other
right or remedy available to them against the Borrower or any other Grantor,
without affecting or impairing in any way the liability of any Guarantor
hereunder except to the extent the Obligations have been fully and indefeasibly
paid in full in cash. To the fullest extent permitted by applicable law, each
Guarantor waives any defense arising out of any such election even though such
election operates, pursuant to applicable law, to impair or to extinguish any
right of reimbursement or subrogation or other right or
12
remedy of such Guarantor against the Borrower or any other Grantor, as the case
may be, or any security.
SECTION 2.04. REINSTATEMENT. Each Guarantor agrees that its guarantee
hereunder shall continue to be effective or be reinstated, as the case may be,
if at any time payment, or any part thereof, of any Obligation is rescinded or
must otherwise be restored by the Collateral Agent or any other Secured Party
upon the bankruptcy or reorganization of the Borrower, any other Grantor or
otherwise.
SECTION 2.05. AGREEMENT TO PAY; SUBROGATION. In furtherance of the
foregoing and not in limitation of any other right that the Collateral Agent or
any other Secured Party has at law or in equity against any Guarantor by virtue
hereof, upon the failure of the Borrower or any other Grantor to pay any
Obligation when and as the same shall become due, whether at maturity, by
acceleration, after notice of prepayment or otherwise, each Guarantor hereby
promises to and will forthwith pay, or cause to be paid, to the Collateral Agent
for distribution to the applicable Secured Parties in cash the amount of such
unpaid Obligation. Upon payment by any Guarantor of any sums to the Collateral
Agent as provided above, all rights of such Guarantor against the Borrower or
any other Guarantor arising as a result thereof by way of right of subrogation,
contribution, reimbursement, indemnity or otherwise shall in all respects be
subject to Article VI.
SECTION 2.06. INFORMATION. Each Guarantor assumes all responsibility
for being and keeping itself informed of the Borrower's and each Guarantor's
financial condition and assets and of all other circumstances bearing upon the
risk of nonpayment of the Obligations and the nature, scope and extent of the
risks that such Guarantor assumes and incurs hereunder, and agrees that neither
the Collateral Agent nor any other Secured Party will have any duty to advise
such Guarantor of information known to it or any of them regarding such
circumstances or risks.
ARTICLE III
Pledge of Securities
SECTION 3.01. PLEDGE. As security for the payment or performance, as
the case may be, in full of the Obligations, each Grantor hereby assigns and
pledges to the Collateral Agent, its successors and assigns, for the ratable
benefit of the Secured Parties, and hereby grants to the Collateral Agent, its
successors and assigns, for the ratable benefit of the Secured Parties, a
security interest in, all of such Grantor's right, title and interest in, to and
under (a)(i) the shares of capital stock and other Equity Interests owned by
such Grantor on the date hereof (including all such shares and other Equity
Interests set forth on Schedule II), (ii) any other Equity Interests obtained in
the future by such Grantor and (iii) the certificates representing all such
Equity Interests (all the foregoing collectively referred to herein as the
"PLEDGED EQUITY INTERESTS"); provided that the Pledged Equity Interests shall
not include more than 66% of the issued and outstanding voting Equity Interests
of any Foreign Subsidiary, (b)(i) the debt securities held by such Grantor on
the date hereof (including all such debt securities set forth on
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Schedule II), (ii) any debt securities in the future issued to such Grantor and
(iii) the promissory notes and any other instruments evidencing such debt
securities (all the foregoing collectively referred to herein as the "PLEDGED
DEBT SECURITIES"), (c) all other property that may be delivered to and held by
the Collateral Agent pursuant to the terms of this Section 3.01, (d) subject to
Section 3.06, all payments of principal or interest, dividends, cash,
instruments and other property from time to time received, receivable or
otherwise distributed in respect of, in exchange for or upon the conversion of,
and all other Proceeds received in respect of, the securities referred to in
clauses (a) and (b) above, (e) subject to Section 3.06, all rights and
privileges of such Grantor with respect to the securities and other property
referred to in clauses (a), (b), (c) and (d) above, and (f) all Proceeds of any
of the foregoing (the items referred to in clauses (a) through (f) above being
collectively referred to as the "PLEDGED COLLATERAL").
TO HAVE AND TO HOLD the Pledged Collateral, together with all right,
title, interest, powers, privileges and preferences pertaining or incidental
thereto, unto the Collateral Agent, its successors and assigns, for the ratable
benefit of the Secured Parties, forever; subject, however, to the terms,
covenants and conditions hereinafter set forth.
SECTION 3.02. DELIVERY OF THE PLEDGED COLLATERAL. (a) Each Grantor
agrees promptly to deliver or cause to be delivered to the Collateral Agent any
and all certificates, instruments or other documents representing or evidencing
Pledged Securities.
(b) Each Grantor agrees promptly to deliver or cause to be delivered
to the Collateral Agent any and all Pledged Debt Securities.
(c) Upon delivery to the Collateral Agent, (i) any certificate,
instrument or document representing or evidencing Pledged Securities shall be
accompanied by undated stock powers duly executed in blank or other undated
instruments of transfer satisfactory to the Collateral Agent and duly executed
in blank and by such other instruments and documents as the Collateral Agent may
request and (ii) all other property comprising part of the Pledged Collateral
shall be accompanied by proper instruments of assignment duly executed by the
applicable Grantor and such other instruments or documents as the Collateral
Agent may request. Each delivery of Pledged Securities shall be accompanied by a
schedule describing the securities, which schedule shall be attached hereto as
Schedule II and made a part hereof; provided that failure to attach any such
schedule hereto shall not affect the validity of the pledge of such Pledged
Securities. Each schedule so delivered shall supplement any prior schedules so
delivered.
SECTION 3.03. REPRESENTATIONS, WARRANTIES AND COVENANTS. The Grantors
jointly and severally represent, warrant and covenant to and with the Collateral
Agent, for the benefit of the Secured Parties, that:
(a) Schedule II correctly sets forth the percentage of the issued
and outstanding shares of each class of the Equity Interests of the
issuer thereof represented by such Pledged Equity Interests and
includes all
14
Equity Interests, debt securities and promissory notes required to be
pledged hereunder;
(b) the Pledged Equity Interests and Pledged Debt Securities have
been duly and validly authorized and issued by the issuers thereof and
(i) in the case of Pledged Equity Interests, are fully paid and
nonassessable and (ii) in the case of Pledged Debt Securities, are
legal, valid and binding obligations of the issuers thereof;
(c) except for the security interests granted hereunder (or
otherwise permitted under the Credit Agreements), each Grantor (i) is
and, subject to any transfers made in compliance with the Credit
Agreements, will continue to be the direct owner, beneficially and of
record, of the Pledged Securities indicated on Schedule II as owned by
such Grantor, (ii) holds the same free and clear of all Liens, (iii)
will make no assignment, pledge, hypothecation or transfer of, or
create or permit to exist any security interest in or other Lien on,
the Pledged Collateral, other than transfers made in compliance with
the Credit Agreements, and (iv) subject to Section 3.06, will cause
any and all Pledged Collateral, whether for value paid by such Grantor
or otherwise, to be forthwith deposited with the Collateral Agent and
pledged or assigned hereunder;
(d) except for restrictions and limitations imposed by the Loan
Documents or securities laws generally, the Pledged Collateral is and
will continue to be freely transferable and assignable, and none of
the Pledged Collateral is or will be subject to any option, right of
first refusal, shareholders agreement, charter or by-law provisions or
contractual restriction of any nature that might prohibit, impair,
delay or otherwise affect the pledge of such Pledged Collateral
hereunder, the sale or disposition thereof pursuant hereto or the
exercise by the Collateral Agent of rights and remedies hereunder;
(e) each Grantor (i) has the power and authority to pledge the
Pledged Collateral pledged by it hereunder in the manner hereby done
or contemplated and (ii) will defend its title or interest thereto or
therein against any and all Liens (other than the Lien created or
permitted by the Loan Documents), however arising, of all persons
whomsoever;
(f) no consent or approval of any Governmental Authority, any
securities exchange or any other person was or is necessary to the
validity of the pledge effected hereby (other than such as have been
obtained and are in full force and effect or as to which the failure
to obtain could not reasonably be expected to result in a Material
Adverse Effect);
(g) by virtue of the execution and delivery by each Grantor of
this Agreement, when any Pledged Securities are delivered to the
Collateral Agent in accordance with this Agreement, the Collateral
Agent will obtain
15
a legal, valid and perfected first-priority lien upon and security
interest in such Pledged Securities as security for the payment and
performance of the Obligations; and
(h) the pledge effected hereby is effective to vest in the
Collateral Agent, for the ratable benefit of the Secured Parties, the
rights of the Collateral Agent in the Pledged Collateral as set forth
herein and all action by any Grantor necessary or desirable to protect
and perfect the Lien on the Pledged Collateral has been duly taken.
SECTION 3.04. CERTIFICATION OF LIMITED LIABILITY COMPANY INTERESTS AND
LIMITED PARTNERSHIP INTERESTS. Each interest in any limited liability company or
limited partnership which is a Subsidiary and pledged hereunder shall be
represented by a certificate, shall be a "security" within the meaning of
Article 8 of the New York UCC and shall be governed by Article 8 of the New York
UCC.
SECTION 3.05. REGISTRATION IN NOMINEE NAME; DENOMINATIONS. The
Collateral Agent, on behalf of the Secured Parties, shall have the right (in its
sole and absolute discretion) to hold the Pledged Securities in its own name as
pledgee, the name of its nominee (as pledgee or as sub-agent) or the name of the
applicable Grantor, endorsed or assigned in blank or in favor of the Collateral
Agent. Each Grantor will promptly give to the Collateral Agent copies of any
notices or other communications received by it with respect to Pledged
Securities in its capacity as the registered owner thereof. The Collateral Agent
shall at all times following the occurrence and during the continuance of an
Event of Default have the right to exchange the certificates representing
Pledged Securities for certificates of smaller or larger denominations for any
purpose consistent with this Agreement.
SECTION 3.06. VOTING RIGHTS; DIVIDENDS AND INTEREST, ETC. (a) Unless
and until an Event of Default shall have occurred and be continuing and the
Collateral Agent shall have given the Grantors notice of its intent to exercise
its rights under this Agreement (which notice shall be deemed to have been given
immediately upon the occurrence of an Event of Default under paragraph (g) or
(h) of Article VII of either Credit Agreement):
(i) Each Grantor shall be entitled to exercise any and all voting
and/or other consensual rights and powers inuring to an owner of
Pledged Securities or any part thereof for any purpose consistent with
the terms of this Agreement, each Credit Agreement and each other Loan
Document; provided, however, that such rights and powers shall not be
exercised in any manner that could materially and adversely affect the
rights inuring to a holder of any Pledged Securities or the rights and
remedies of any of the Collateral Agent or the other Secured Parties
under this Agreement, any Credit Agreement or any other Loan Document
or the ability of the Secured Parties to exercise the same.
16
(ii) The Collateral Agent shall execute and deliver to each
Grantor, or cause to be executed and delivered to each Grantor, all
such proxies, powers of attorney and other instruments as such Grantor
may reasonably request for the purpose of enabling such Grantor to
exercise the voting and/or consensual rights and powers it is entitled
to exercise pursuant to paragraph (i) above.
(iii) Each Grantor shall be entitled to receive and retain any
and all dividends, interest, principal and other distributions paid on
or distributed in respect of the Pledged Securities to the extent and
only to the extent that such dividends, interest, principal and other
distributions are permitted by, and otherwise paid or distributed in
accordance with, the terms and conditions of each Credit Agreement,
each other Loan Document and applicable law; provided, however, that
any noncash dividends, interest, principal or other distributions that
would constitute Pledged Equity Interests or Pledged Debt Securities,
whether resulting from a subdivision, combination or reclassification
of the outstanding Equity Interests of the issuer of any Pledged
Securities or received in exchange for Pledged Securities or any part
thereof, or in redemption thereof, or as a result of any merger,
consolidation, acquisition or other exchange of assets to which such
issuer may be a party or otherwise, shall be and become part of the
Pledged Collateral, and, if received by any Grantor, shall not be
commingled by such Grantor with any of its other funds or property but
shall be held separate and apart therefrom, shall be held in trust for
the ratable benefit of the Collateral Agent and shall be forthwith
delivered to the Collateral Agent in the same form as so received
(with any necessary endorsement, stock power or instrument of
assignment). This paragraph (iii) shall not apply to dividends between
or among the Borrower, the Guarantors and any Subsidiaries only of
property subject to a perfected security interest under this
Agreement; provided that the Borrower notifies the Collateral Agent in
writing, specifically referring to this Section 3.06 at the time of
such dividend and takes any actions the Collateral Agent specifies to
ensure the continuance of its perfected security interest in such
property under this Agreement.
(b) Upon the occurrence and during the continuance of an Event of
Default, after the Collateral Agent shall have notified (or shall be deemed to
have notified pursuant to Section 3.06(a)) the Grantors of the suspension of
their rights under paragraph (a)(iii) of this Section 3.06, then all rights of
any Grantor to dividends, interest, principal or other distributions that such
Grantor is authorized to receive pursuant to paragraph (a)(iii) of this Section
3.06 shall cease, and all such rights shall thereupon become vested in the
Collateral Agent, which shall have the sole and exclusive right and authority to
receive and retain such dividends, interest, principal or other distributions.
All dividends, interest, principal or other distributions received by any
Grantor contrary to the provisions of this Section 3.06 shall be held in trust
for the benefit of the Collateral Agent, shall be segregated from other property
or funds of such Grantor and shall be forthwith delivered to the Collateral
Agent upon demand in the same form as so received
17
(with any necessary endorsement or instrument of assignment). Any and all money
and other property paid over to or received by the Collateral Agent pursuant to
the provisions of this paragraph (b) shall be retained by the Collateral Agent
in the Special Trust Account upon receipt of such money or other property and
shall be applied in accordance with the provisions of Section 5.02. After all
Events of Default have been cured or waived and each applicable Grantor has
delivered to the Administrative Agents certificates to that effect, the
Collateral Agent shall, promptly after all such Events of Default have been
cured or waived, repay to each applicable Grantor (without interest) all
dividends, interest, principal or other distributions that such Grantor would
otherwise be permitted to retain pursuant to the terms of paragraph (a)(iii) of
this Section 3.06 and that remain in the Special Trust Account.
(c) Upon the occurrence and during the continuance of an Event of
Default, after the Collateral Agent shall have notified (or shall be deemed to
have notified pursuant to Section 3.06(a)) the Grantors of the suspension of
their rights under paragraph (a)(i) of this Section 3.06, then all rights of any
Grantor to exercise the voting and consensual rights and powers it is entitled
to exercise pursuant to paragraph (a)(i) of this Section 3.06, and the
obligations of the Collateral Agent under paragraph (a)(ii) of this Section
3.06, shall cease, and all such rights shall thereupon become vested in the
Collateral Agent, which shall have the sole and exclusive right and authority to
exercise such voting and consensual rights and powers; provided that, unless
otherwise directed by the Majority Secured Parties, the Collateral Agent shall
have the right from time to time following and during the continuance of an
Event of Default to permit the Grantors to exercise such rights.
(d) Any notice given by the Collateral Agent to the Grantors
exercising its rights under paragraph (a) of this Section 3.06 (i) may be given
by telephone if promptly confirmed in writing, (ii) may be given to one or more
of the Grantors at the same or different times and (iii) may suspend the rights
of the Grantors under paragraph (a)(i) or paragraph (a)(iii) in part without
suspending all such rights (as specified by the Collateral Agent in its sole and
absolute discretion) and without waiving or otherwise affecting the Collateral
Agent's rights to give additional notices from time to time suspending other
rights so long as an Event of Default has occurred and is continuing.
ARTICLE IV
SECURITY INTERESTS IN PERSONAL PROPERTY
SECTION 4.01. SECURITY INTEREST. (a) As security for the payment or
performance, as the case may be, in full of the Obligations, each Grantor hereby
assigns and pledges to the Collateral Agent, its successors and assigns, for the
ratable benefit of the Secured Parties, and hereby grants to the Collateral
Agent, its successors and assigns, for the ratable benefit of the Secured
Parties, a security interest (the "SECURITY INTEREST"), in all right, title or
interest in or to any and all of the following assets and properties now owned
or at any time hereafter acquired by such Grantor or in which such Grantor now
has or at any time in the future may acquire any right, title or interest
(collectively, the "ARTICLE 9 COLLATERAL"):
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(i) all Accounts;
(ii) all Chattel Paper;
(iii) all cash and Deposit Accounts;
(iv) all Documents;
(v) all Equipment;
(vi) all General Intangibles;
(vii) all Instruments;
(viii) all Inventory;
(ix) all Investment Property;
(x) all Letter-of-Credit Rights;
(xi) all Commercial Tort Claims;
(xii) all books and records pertaining to the Article 9
Collateral; and
(xiii) to the extent not otherwise included, all Proceeds and
products of any and all of the foregoing and all collateral security
and guarantees given by any person with respect to any of the
foregoing.
Notwithstanding anything herein to the contrary, in no event shall the security
interest granted hereunder attach to (A) any contract or agreement to which a
Grantor is a party or any of its rights or interests thereunder if and for so
long as the grant of such security interest shall constitute or result in (x)
the unenforceability of any right of the Grantor therein or (y) in a breach or
termination pursuant to the terms of, or a default under, any such contract or
agreement (other than to the extent that any such term would be rendered
ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the New York
UCC or any other applicable law or principles of equity); provided, however,
that such security interest shall attach immediately at such time as the
condition causing such unenforceability shall be remedied and, to the extent
severable, shall attach immediately to any portion of such contract or agreement
that does not result in any of the consequences specified in clauses (x) or (y)
including, without limitation, any proceeds of such contract or agreement, or
(B) any Intellectual Property to the extent the grant of a security interest
therein by a Grantor would result in the cancellation or invalidity thereof.
(b) Each Grantor hereby irrevocably authorizes the Collateral Agent at
any time and from time to time to file in any relevant jurisdiction any initial
financing statements (including fixture filings) with respect to the Article 9
Collateral or any part thereof and amendments thereto that (i) indicate the
Article 9 Collateral as "all assets" of
19
such Grantor or words of similar effect, and (ii) contain the information
required by Article 9 of the Uniform Commercial Code of each applicable
jurisdiction for the filing of any financing statement or amendment, including
(A) whether such Grantor is an organization, the type of organization and any
organizational identification number issued to such Grantor and, (B) in the case
of a financing statement filed as a fixture filing, a sufficient description of
the real property to which such Article 9 Collateral relates. Each Grantor
agrees to provide such information to the Collateral Agent promptly upon
request.
Each Grantor also ratifies its authorization for the Collateral Agent
to file in any relevant jurisdiction any initial financing statements or
amendments thereto if filed prior to the date hereof.
The Collateral Agent is further authorized to file with the United
States Patent and Trademark Office or United States Copyright Office (or any
successor office or any similar office in any other country) such documents as
may be necessary or reasonably advisable for the purpose of perfecting,
confirming, continuing, enforcing or protecting the Security Interest granted by
each Grantor, without the signature of any Grantor, and naming any Grantor or
the Grantors as debtors and the Collateral Agent as secured party.
(c) The Security Interest is granted as security only and shall not
subject the Collateral Agent or any other Secured Party to, or in any way alter
or modify, any obligation or liability of any Grantor with respect to or arising
out of the Article 9 Collateral.
(d) Notwithstanding anything contained herein or in any of the Loan
Documents to the contrary, in no event shall any Grantor have any obligation to
disclose, schedule or perfect any security interest in any Copyright or License
existing as of the date hereof that such Grantor, in its reasonable business
judgment, does not consider to be material to the conduct of the business of the
Borrower and its Subsidiaries, taken as a whole, or that are subject to the
copyright laws of any country other than the United States.
SECTION 4.02. REPRESENTATIONS AND WARRANTIES. The Grantors jointly and
severally represent and warrant to the Collateral Agent and the Secured Parties
that:
(a) Each Grantor has good and valid rights in and title to the
Article 9 Collateral with respect to which it has purported to grant a
Security Interest hereunder and has full power and authority to grant
to the Collateral Agent, for the ratable benefit of the Secured
Parties, the Security Interest in such Article 9 Collateral pursuant
hereto and to execute, deliver and perform its obligations in
accordance with the terms of this Agreement, without the consent or
approval of any other person other than any consent or approval that
has been obtained.
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(b) The Perfection Certificate has been duly prepared, completed
and executed and the information set forth therein (including (x) the
exact legal name of each Grantor and (y) the jurisdiction of
organization of each Grantor) is correct and complete as of the
Closing Date. Uniform Commercial Code financing statements (including
fixture filings, as applicable) or other appropriate filings,
recordings or registrations containing a description of the Article 9
Collateral have been prepared by the Collateral Agent based upon the
information provided to the Collateral Agent, the Administrative
Agents and the Secured Parties in the Perfection Certificate for
filing in each governmental, municipal or other office specified in
Schedule 2 to the Perfection Certificate (or specified by notice from
the Borrower to the Collateral Agent after the Closing Date in the
case of filings, recordings or registrations required by Sections 5.06
or 5.12 of each Credit Agreement), which are all the filings,
recordings and registrations (other than filings required to be made
in the United States Patent and Trademark Office and the United States
Copyright Office in order to perfect the Security Interest in the
Article 0 Xxxxxxxxxx xxxxxxxxxx xx Xxxxxx Xxxxxx Patents, Trademarks
and Copyrights) that are necessary to publish notice of and protect
the validity of and to establish a legal, valid and perfected security
interest in favor of the Collateral Agent (for the ratable benefit of
the Secured Parties) in respect of all Article 9 Collateral in which
the Security Interest may be perfected by filing, recording or
registration in the United States (or any political subdivision
thereof) and its territories and possessions, and no further or
subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary in any such jurisdiction, except as
provided under applicable law with respect to the filing of
continuation statements. Each Grantor represents and warrants that
fully executed short-form security agreements (in form and substance
satisfactory to the Collateral Agent), collectively containing a
description of all Article 9 Collateral consisting of issued,
registered or pending and otherwise material Intellectual Property
with respect to United States Patents (and applications therefor),
United States Trademarks (and applications therefor) and United States
Copyrights, have been delivered to the Collateral Agent for recording
in the United States Patent and Trademark Office and/or the United
States Copyright Office pursuant to 35 U.S.C. Section 261, 15 U.S.C.
Section 1060 or 17 U.S.C. Section 205 and the regulations thereunder,
as applicable, to protect the validity of and to establish a legal,
valid and perfected security interest in favor of the Collateral Agent
(for the ratable benefit of the Secured Parties) in respect of all
Article 9 Collateral consisting of Patents, Trademarks and Copyrights
in which a security interest may be perfected by filing, recording or
registration in the United States (or any political subdivision
thereof) and its territories and possessions, and no further or
subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary with respect to such Patents, Trademarks
and Copyrights (other than such actions as are necessary to perfect
the Security Interest with
21
respect to any Article 9 Collateral consisting of Patents, Trademarks
and Copyrights (or registration or application for registration
thereof) acquired or developed after the date hereof).
(c) The Security Interest constitutes (i) a legal and valid
security interest in all Article 9 Collateral securing the payment and
performance of the Obligations, (ii) subject to the filing of the
financing statements described in Section 4.02(b), a perfected
security interest in all Article 9 Collateral in which a security
interest may be perfected by filing, recording or registering a
financing statement or analogous document in the United States (or any
political subdivision thereof) and its territories and possessions
pursuant to the Uniform Commercial Code or other applicable law in
such jurisdictions and (iii) a security interest that shall be
perfected in all Article 9 Collateral in which a security interest may
be perfected upon the receipt and recording of the short-form security
agreement referred to in paragraph (b) above with the United States
Patent and Trademark Office and the United States Copyright Office, as
applicable. The Security Interest is and shall be prior to any other
Lien on any of the Article 9 Collateral, other than Liens expressly
permitted pursuant to Section 6.02 of each Credit Agreement that have
priority as a matter of law.
(d) The Article 9 Collateral is owned by the Grantors free and
clear of any Lien, except for Liens expressly permitted pursuant to
Section 6.02 of each Credit Agreement. No Grantor has filed or
consented to the filing of (i) any financing statement or analogous
document under the Uniform Commercial Code or any other applicable
laws covering any Article 9 Collateral, (ii) any assignment in which
any Grantor assigns any Collateral or any security agreement or
similar instrument covering any Article 9 Collateral with the United
States Patent and Trademark Office or the United States Copyright
Office, (iii) any notice under the Assignment of Claims Act, or (iv)
any assignment in which any Grantor assigns any Article 9 Collateral
or any security agreement or similar instrument covering any Article 9
Collateral with any foreign governmental, municipal or other office,
which financing statement or analogous document, assignment, security
agreement or similar instrument is still in effect, except, in each
case, for Liens expressly permitted pursuant to Section 6.02 of each
Credit Agreement. No Grantor holds any Commercial Tort Claims except
as indicated on the Perfection Certificate.
SECTION 4.03. COVENANTS. (a) Each Grantor agrees promptly to notify
the Collateral Agent in writing of any change in (i) its legal name, (ii) its
identity or type of organization or corporate structure, (iii) its Federal
Taxpayer Identification Number or organizational identification number or (iv)
in its jurisdiction of organization. Each Grantor agrees promptly to provide the
Collateral Agent with certified organizational documents reflecting any of the
changes described in the first sentence of this paragraph. Each Grantor agrees
not to effect or permit any change referred to in the preceding
22
sentence unless all filings have been made under the Uniform Commercial Code or
otherwise that are required in order for the Collateral Agent to continue at all
times following such change to have a valid, legal and perfected first priority
security interest in all the Article 9 Collateral. Each Grantor agrees promptly
to notify the Collateral Agent if any material portion of the Article 9
Collateral owned or held by such Grantor is damaged or destroyed.
(b) Each Grantor agrees to (i) maintain, at its own cost and expense,
such complete and accurate records with respect to the Article 9 Collateral
owned by it as is consistent with its current practices and in accordance with
such prudent and standard practices used in industries that are the same as or
similar to those in which such Grantor is engaged and (ii) at such time or times
as the Collateral Agent may reasonably request, promptly to prepare and deliver
to the Collateral Agent a duly certified schedule or schedules in form and
detail satisfactory to the Collateral Agent showing the identity, amount and
location of any and all Article 9 Collateral.
(c) Each year, at the time of delivery of annual financial statements
with respect to the preceding fiscal year pursuant to Section 5.04(a) of each
Credit Agreement, the Borrower shall deliver to the Collateral Agent a
certificate executed by its chief legal officer and a Responsible Officer of the
Borrower certifying that all Uniform Commercial Code financing statements
(including fixture filings, as applicable) or other appropriate filings
recordings or registrations, including all refilings, recordings and
registrations, containing a description of the Article 9 Collateral have been
filed of record in each governmental, municipal or other appropriate office in
each jurisdiction identified pursuant to clause (a) of this Section 4.03 to the
extent necessary to protect and perfect the Security Interest for a period of
not less than 18 months after the date of such certificate (except as noted
therein with respect to any continuation statements to be filed within such
period). Each certificate delivered pursuant to this Section 4.03(c) shall
identify in the format of Schedule III all registered, issued or otherwise
material Intellectual Property (or with respect to which applications for
issuance or registration are pending) of any Grantor in existence on the date
thereof and not then listed on such Schedules or previously so identified to the
Collateral Agent.
(d) Each Grantor shall, at its own expense, take any and all actions
necessary to defend title to the Article 9 Collateral against all persons and to
defend the Security Interest of the Collateral Agent in the Article 9 Collateral
and the priority thereof against any Lien not expressly permitted pursuant to
Section 6.02 of each Credit Agreement.
(e) Each Grantor agrees, at its own expense, promptly to execute,
acknowledge, deliver and cause to be duly filed all such further instruments and
documents and take all such actions as the Collateral Agent may from time to
time reasonably request to better assure, obtain, preserve, protect and perfect
the Security Interest (to the extent the Security Interest may be assured,
obtained, preserved, protected and/or perfected by such filing or other action)
and the rights and remedies created hereby, including the payment of any fees
and Taxes required in connection with the execution and delivery of this
Agreement, the granting of the Security Interest and the
23
filing of any financing or continuation statements (including fixture filings)
or other documents in connection herewith or therewith. If any amount payable to
any Grantor under or in connection with any of the Article 9 Collateral shall be
or become evidenced by any promissory note or other instrument, such note or
instrument shall be promptly pledged and delivered to the Collateral Agent, duly
endorsed in a manner satisfactory to the Collateral Agent.
Without limiting the generality of the foregoing, each Grantor hereby
authorizes the Collateral Agent, with prompt notice thereof to the Grantors, to
supplement this Agreement by supplementing Schedule III or adding additional
schedules hereto to identify specifically any asset or item of a Grantor that
may, in the Collateral Agent's reasonable judgment, constitute Copyrights,
Licenses, Patents or Trademarks; provided that any Grantor shall have the right,
exercisable within 15 days after it has been notified by the Collateral Agent of
the specific identification of such Collateral, to advise the Collateral Agent
in writing of any inaccuracy of the representations and warranties made by such
Grantor hereunder with respect to such Collateral. Each Grantor agrees that it
will use its commercially reasonable best efforts to take such action as shall
be necessary in order that all representations and warranties hereunder shall be
true and correct with respect to such Collateral within 30 days after the date
it has been notified by the Collateral Agent of the specific identification of
such Collateral.
(f) The Collateral Agent and such persons as the Collateral Agent may
designate shall have the right, at the applicable Grantor's own cost and
expense, to inspect the Article 9 Collateral, all records related thereto (and
to make extracts and copies from such records) and the premises upon which any
of the Article 9 Collateral is located, to discuss the applicable Grantor's
affairs with the officers of such Grantor and its independent accountants and to
verify the existence, validity, amount, quality, quantity, value, condition and
status of, or any other matter relating to, the Article 9 Collateral, including,
in the case of Accounts or other Article 9 Collateral in the possession of any
third person, by contacting Account Debtors or the third person possessing such
Article 9 Collateral for the purpose of making such a verification. The
Collateral Agent shall have the absolute right to share any information it gains
from such inspection or verification with any Secured Party (it being understood
that any such information shall be deemed to be "Information" for the purpose of
the confidentiality provisions set forth in Section 9.16 of each Credit
Agreement).
(g) At its option, the Collateral Agent may discharge past due Taxes,
assessments, charges, fees, Liens, security interests or other encumbrances at
any time levied or placed on the Article 9 Collateral and not expressly
permitted pursuant to Section 5.03 or Section 6.02 of each Credit Agreement, and
may pay for the maintenance and preservation of the Article 9 Collateral to the
extent any Grantor fails to do so as required by the Credit Agreements or this
Agreement, and each Grantor jointly and severally agrees to reimburse the
Collateral Agent on demand for any payment made or any expense incurred by the
Collateral Agent pursuant to the foregoing authorization; provided, however,
that nothing in this paragraph shall be interpreted as excusing any Grantor from
the performance of, or imposing any obligation on the Collateral Agent or any
Secured Party to cure or perform, any covenants or other promises of any Grantor
24
with respect to Taxes, assessments, charges, fees, Liens, security interests or
other encumbrances and maintenance as set forth herein or in the other Loan
Documents.
(h) If at any time any Grantor shall take a security interest in any
property of an Account Debtor or any other person to secure payment and
performance of an Account, such Grantor shall promptly assign such security
interest to the Collateral Agent for the ratable benefit of the Secured Parties.
Such assignment need not be filed of public record unless necessary to continue
the perfected status of the security interest against creditors of and
transferees from the Account Debtor or other person granting the security
interest.
(i) As between each Grantor, the Collateral Agent and the Secured
Parties, each Grantor shall remain liable to observe and perform all the
conditions and obligations to be observed and performed by it under each
contract, agreement or instrument relating to the Article 9 Collateral, all in
accordance with the terms and conditions thereof, and each Grantor jointly and
severally agrees to indemnify and hold harmless the Collateral Agent and the
Secured Parties from and against any and all liability for such performance.
(j) No Grantor shall make or permit to be made an assignment, pledge
or hypothecation of the Article 9 Collateral or shall grant any other Lien in
respect of the Article 9 Collateral or permit any notice to be filed under the
Assignment of Claims Act, except, in each case, as expressly permitted by
Section 6.02 of each Credit Agreement. No Grantor shall make or permit to be
made any transfer of the Article 9 Collateral and each Grantor shall remain at
all times in possession or otherwise in control of the Article 9 Collateral
owned by it, except as permitted by the Credit Agreements.
(k) No Grantor will, without the Collateral Agent's prior written
consent, grant any extension of the time of payment of any Accounts included in
the Article 9 Collateral, compromise, compound or settle the same for less than
the full amount thereof, release, wholly or partly, any person liable for the
payment thereof or allow any credit or discount whatsoever thereon, other than
extensions, credits, discounts, compromises, compoundings or settlements granted
or made in the ordinary course of business and consistent with its current
practices and in accordance with such prudent and standard practices used in
industries that are the same as or similar to those in which such Grantor is
engaged.
(l) Each Grantor, at its own expense, shall maintain or cause to be
maintained insurance covering physical loss or damage to the Inventory and
Equipment in accordance with the requirements set forth in Section 5.02 of each
Credit Agreement. Each Grantor irrevocably makes, constitutes and appoints the
Collateral Agent (and all officers, employees or agents designated by the
Collateral Agent) as such Grantor's true and lawful agent (and attorney-in-fact)
for the purpose, upon the occurrence and during the continuance of an Event of
Default, of making, settling and adjusting claims in respect of Article 9
Collateral under policies of insurance, endorsing the name of such Grantor on
any check, draft, instrument or other item of payment for the proceeds of such
policies of insurance and for making all determinations and decisions with
respect
25
thereto. In the event that any Grantor at any time or times shall fail to obtain
or maintain any of the policies of insurance required hereby or under the Credit
Agreements or to pay any premium in whole or part relating thereto, the
Collateral Agent may, without waiving or releasing any obligation or liability
of any Grantor hereunder or any Default or Event of Default, in its sole
discretion, obtain and maintain such policies of insurance and pay such premium
and take any other actions with respect thereto as the Collateral Agent deems
advisable. All sums disbursed by the Collateral Agent in connection with this
paragraph, including attorneys' fees, court costs, expenses and other charges
relating thereto, shall be payable, upon demand, by the Grantors to the
Collateral Agent and shall be additional Obligations secured hereby.
(m) Each Grantor shall maintain, in form and manner satisfactory to
the Collateral Agent, records of its Chattel Paper and its books, records and
documents evidencing or pertaining thereto.
SECTION 4.04. OTHER ACTIONS. In order to further insure the
attachment, perfection and priority of, and the ability of the Collateral Agent
to enforce, the Security Interest in the Article 9 Collateral, each Grantor
agrees, in each case at such Grantor's own expense, to take the following
actions with respect to the following Article 9 Collateral:
(a) INSTRUMENTS. If any Grantor shall at any time hold or acquire
any Instruments having a face amount in excess of $100,000, such
Grantor shall forthwith endorse, assign and deliver the same to the
Collateral Agent, accompanied by such undated instruments of
endorsement, transfer or assignment duly executed in blank as the
Collateral Agent may from time to time specify.
(b) DEPOSIT ACCOUNTS. For each Deposit Account that any Grantor
at any time opens or maintains in which more than $250,000 is held for
more than ten consecutive Business Days, such Grantor shall, upon the
Collateral Agent's request, either (i) cause the depositary bank to
agree to comply at any time with instructions from the Collateral
Agent to such depositary bank directing the disposition of funds from
time to time credited to such Deposit Account, without further consent
of such Grantor or any other person, pursuant to an agreement in form
and substance satisfactory to the Collateral Agent, or (ii) arrange
for the Collateral Agent to become the customer of the depositary bank
with respect to the Deposit Account, with the Grantor being permitted,
only with the consent of the Collateral Agent, to exercise rights to
withdraw funds from such Deposit Account. The Collateral Agent agrees
with each Grantor that the Collateral Agent shall not give any such
instructions or withhold any withdrawal rights from any Grantor,
unless an Event of Default has occurred and is continuing, or, after
giving effect to any withdrawal, would occur. The provisions of this
paragraph shall not apply to any Deposit Account for which any
Grantor, the depositary bank and the Collateral Agent have entered
into a cash collateral agreement specially
26
negotiated among such Grantor, the depositary bank and the Collateral
Agent for the specific purpose set forth therein.
(c) INVESTMENT PROPERTY. Except to the extent otherwise provided
in Article III, if any Grantor shall at any time hold or acquire any
certificated securities, such Grantor shall forthwith endorse, assign
and deliver the same to the Collateral Agent, accompanied by such
undated instruments of transfer or assignment duly executed in blank
as the Collateral Agent may from time to time specify. If any
securities now or hereafter acquired by any Grantor are uncertificated
and are issued to such Grantor or its nominee directly by the issuer
thereof, such Grantor shall promptly notify the Collateral Agent
thereof and, at the Collateral Agent's request and option, pursuant to
an agreement in form and substance satisfactory to the Collateral
Agent, either (i) cause the issuer to agree to comply with
instructions from the Collateral Agent as to such securities, without
further consent of any Grantor or such nominee, or (ii) arrange for
the Collateral Agent to become the registered owner of the securities.
If any securities, whether certificated or uncertificated, or other
Investment Property now or hereafter acquired by any Grantor are held
by such Grantor or its nominee through a Securities Intermediary or
Commodity Intermediary and the aggregate value of such Investment
Property exceeds $250,000 for more than ten consecutive Business Days,
such Grantor shall promptly notify the Collateral Agent thereof and,
at the Collateral Agent's request and option, pursuant to an agreement
in form and substance satisfactory to the Collateral Agent, either (i)
cause such Securities Intermediary or Commodity Intermediary, as the
case may be, to agree to comply with Entitlement Orders or other
instructions from the Collateral Agent to such Securities Intermediary
as to such securities or other Investment Property, or (as the case
may be) to apply any value distributed on account of any commodity
contract as directed by the Collateral Agent to such Commodity
Intermediary, in each case without further consent of any Grantor or
such nominee, or (ii) in the case of Financial Assets (as governed by
Article 8 of the New York UCC) or other Investment Property held
through a Securities Intermediary, arrange for the Collateral Agent to
become the Entitlement Holder with respect to such Investment
Property, with the Grantor being permitted, only with the consent of
the Collateral Agent, to exercise rights to withdraw or otherwise deal
with such Investment Property. The Collateral Agent agrees with each
Grantor that the Collateral Agent shall not give any such Entitlement
Orders or instructions or directions to any such issuer, Securities
Intermediary or Commodity Intermediary, and shall not withhold its
consent to the exercise of any withdrawal or dealing rights by any
Grantor, unless an Event of Default has occurred and is continuing,
or, after giving effect to any such investment and withdrawal rights
would occur. The provisions of this paragraph shall not apply to any
Financial Assets credited to a Securities Account for which the
Collateral Agent is the Securities Intermediary.
27
(d) ELECTRONIC CHATTEL PAPER AND TRANSFERABLE RECORDS. If any
Grantor at any time holds or acquires an interest in any Electronic
Chattel Paper or any "transferable record", as that term is defined in
Section 201 of the Federal Electronic Signatures in Global and
National Commerce Act, or in Section 16 of the Uniform Electronic
Transactions Act as in effect in any relevant jurisdiction, such
Grantor shall promptly notify the Collateral Agent thereof and, at the
request of the Collateral Agent, shall take such action as the
Collateral Agent may request to vest in the Collateral Agent control
under New York UCC Section 9-105 of such Electronic Chattel Paper or
control under Section 201 of the Federal Electronic Signatures in
Global and National Commerce Act or, as the case may be, Section 16 of
the Uniform Electronic Transactions Act, as so in effect in such
jurisdiction, of such transferable record. The Collateral Agent agrees
with such Grantor that the Collateral Agent will arrange, pursuant to
procedures satisfactory to the Collateral Agent and so long as such
procedures will not result in the Collateral Agent's loss of control,
for the Grantor to make alterations to the Electronic Chattel Paper or
transferable record permitted under UCC Section 9-105 or, as the case
may be, Section 201 of the Federal Electronic Signatures in Global and
National Commerce Act or Section 16 of the Uniform Electronic
Transactions Act for a party in control to allow without loss of
control, unless an Event of Default has occurred and is continuing or
would occur after taking into account any action by such Grantor with
respect to such Electronic Chattel Paper or transferable record.
(e) LETTER-OF-CREDIT RIGHTS. If any Grantor is at any time a
beneficiary under a letter of credit with a face amount in excess of
$250,000 now or hereafter issued in favor of such Grantor, such
Grantor shall promptly notify the Collateral Agent thereof and, at the
request and option of the Collateral Agent, such Grantor shall,
pursuant to an agreement in form and substance satisfactory to the
Collateral Agent, either (i) arrange for the issuer and any confirmer
of such letter of credit to consent to an assignment to the Collateral
Agent of the proceeds of any drawing under the letter of credit or
(ii) arrange for the Collateral Agent to become the transferee
beneficiary of the letter of credit, with the Collateral Agent
agreeing, in each case, that the proceeds of any drawing under the
letter of credit are to be paid to the applicable Grantor unless an
Event of Default has occurred or is continuing.
(f) COMMERCIAL TORT CLAIMS. If any Grantor shall at any time hold
or acquire a Commercial Tort Claim in an amount reasonably estimated
to exceed $250,000, the Grantor shall promptly notify the Collateral
Agent thereof in a writing signed by such Grantor including a summary
description of such claim and grant to the Collateral Agent, for the
ratable benefit of the Secured Parties, in such writing a security
interest therein and in the proceeds thereof, all upon the terms of
this Agreement, with
28
such writing to be in form and substance satisfactory to the
Collateral Agent.
SECTION 4.05. COVENANTS REGARDING PATENT, TRADEMARK AND COPYRIGHT
COLLATERAL. (a) Each Grantor agrees that it will not, and will not permit any of
its licensees to, do any act, or omit to do any act, whereby any Patent that is
material to the conduct of the business of the Borrower and its Subsidiaries,
taken as a whole, may become invalidated or dedicated to the public, and agrees
that it shall continue to xxxx any products covered by a Patent with the
relevant patent number to the extent necessary and sufficient, as determined in
such Grantor's reasonable discretion, to establish and preserve its rights under
applicable patent laws.
(b) Each Grantor (either itself or through its licensees or its
sublicensees) will, for each Trademark that is material to the conduct of the
business of the Borrower and its Subsidiaries, taken as a whole, (i) maintain
such Trademark in full force free from any claim of abandonment or invalidity
for non-use, (ii) maintain the quality of products and services offered under
such Trademark, (iii) display such Trademark with notice of Federal or foreign
registration to the extent necessary and sufficient, as determined in such
Grantor's reasonable discretion, to establish and preserve its rights under
applicable law and (iv) not knowingly use or knowingly permit the use of such
Trademark in violation of any third party rights.
(c) Each Grantor (either itself or through its licensees or
sublicensees) will, for each work covered by a Copyright that is material to the
conduct of the business of the Borrower and its Subsidiaries, taken as a whole,
continue to publish, reproduce, display, adopt and distribute the work with
appropriate copyright notice to the extent necessary and sufficient, as
determined in such Grantor's reasonable discretion, to establish and preserve
its rights under applicable copyright laws.
(d) Each Grantor shall notify the Collateral Agent promptly if it
knows or has reason to know that any Patent, Trademark or Copyright that is
material to the conduct of the business of the Borrower and its Subsidiaries,
taken as a whole, may become abandoned, lost or dedicated to the public, or of
any adverse final determination (including any such determination in any
proceeding in the United States Patent and Trademark Office, United States
Copyright Office or any court or similar office of any country) regarding such
Grantor's ownership of any Patent, Trademark or Copyright, its right to register
the same, or its right to keep and maintain the same.
(e) At least quarterly in respect of United States Patents, Trademarks
and Copyrights, and annually in respect of non-United States Patents, Trademarks
and Copyrights, each Grantor shall notify the Collateral Agent of all new
applications filed by such Grantor, either itself or through any agent,
employee, licensee or designee, for any Patent or for the registration of any
Trademark or Copyright with the United States Patent and Trademark Office,
United States Copyright Office or any office or agency in any political
subdivision of the United States or in any other country or any political
subdivision thereof, with respect to any of the same which is material to the
conduct of the business of the Borrower and its Subsidiaries, taken as a whole,
and shall, upon the
29
request of the Collateral Agent, execute and deliver any and all agreements,
instruments, documents and papers as the Collateral Agent may reasonably request
to evidence the Security Interest in such Patent, Trademark or Copyright, and
each Grantor hereby appoints the Collateral Agent as its attorney-in-fact
(pursuant to and in accordance with Section 11.07) to execute and file such
writings for the foregoing purposes.
(f) Each Grantor will take all necessary steps that are consistent
with the practice in any proceeding before the United States Patent and
Trademark Office, United States Copyright Office or any office or agency in any
political subdivision of the United States or in any other country or any
political subdivision thereof, if consistent with good business judgment, to
maintain and pursue each material application relating to the Patents,
Trademarks and/or Copyrights of such Grantor (and to obtain the relevant grant
or registration) and to maintain each issued Patent and each registration of the
Trademarks and Copyrights that is material to the conduct of the business of the
Borrower and its Subsidiaries, taken as a whole, including timely filings of
applications for renewal, affidavits of use, affidavits of incontestability and
payment of maintenance fees, and, if consistent with good business judgment, to
initiate opposition, interference and cancellation proceedings against third
parties.
(g) In the event that any Grantor knows or has reason to believe that
any Article 9 Collateral consisting of a Patent, Trademark or Copyright that is
material to the conduct of the business of the Borrower and its Subsidiaries,
taken as a whole, has been or is about to be infringed, misappropriated or
diluted by a third person, such Grantor shall, if consistent with good business
judgment, promptly xxx for infringement, misappropriation or dilution and to
recover any and all damages for such infringement, misappropriation or dilution,
and take such other actions as are appropriate under the circumstances to
protect such Article 9 Collateral and shall promptly notify the Collateral Agent
of the initiation of such suit and the facts and circumstances relevant thereto.
(h) Upon the occurrence and during the continuance of an Event of
Default, each Grantor shall use its commercially reasonable best efforts to
obtain all requisite consents or approvals by the licensor of each Copyright
License, Patent License or Trademark License to effect the assignment of all
such Grantor's right, title and interest thereunder to the Collateral Agent, for
the ratable benefit of the Secured Parties, or its designee.
ARTICLE V
REMEDIES
SECTION 5.01. REMEDIES UPON DEFAULT. Upon the occurrence and during
the continuance of an Event of Default, each Grantor agrees to deliver each item
of Collateral to the Collateral Agent on demand, and it is agreed that the
Collateral Agent shall have the right to take any of or all the following
actions at the same or different times: (a) with respect to any Article 9
Collateral consisting of Intellectual Property, on demand, to cause the Security
Interest to become an assignment, transfer and conveyance of any of or all such
Article 9 Collateral by the applicable Grantor to the Collateral Agent
30
(for the ratable benefit of the Secured Parties), or to license or sublicense,
whether general, special or otherwise, and whether on an exclusive or
nonexclusive basis, any such Article 9 Collateral throughout the world on such
terms and conditions and in such manner as the Collateral Agent shall determine
(other than in violation of any then-existing licensing arrangements to the
extent that consents and/or waivers cannot be obtained), and (b) with or without
legal process and with or without prior notice or demand for performance, to
take possession of the Article 9 Collateral and without liability for trespass
to enter any premises where the Article 9 Collateral may be located for the
purpose of taking possession of or removing the Article 9 Collateral and,
generally, to exercise any and all rights afforded to a secured party under the
Uniform Commercial Code or other applicable law. Without limiting the generality
of the foregoing, upon the occurrence and during the continuance of an Event of
Default, each Grantor agrees that the Collateral Agent shall have the right,
subject to the mandatory requirements of applicable law, to sell or otherwise
dispose of all or any part of the Collateral at a public or private sale or at
any broker's board or on any securities exchange, for cash, upon credit or for
future delivery as the Collateral Agent shall deem appropriate. The Collateral
Agent shall be authorized at any such sale (if it deems it advisable to do so)
to restrict the prospective bidders or purchasers to persons who will represent
and agree that they are purchasing the Collateral for their own account for
investment and not with a view to the distribution or sale thereof, and upon
consummation of any such sale the Collateral Agent shall have the right to
assign, transfer and deliver to the purchaser or purchasers thereof the
Collateral so sold. Each such purchaser at any such sale shall hold the property
sold absolutely, free from any claim or right on the part of any Grantor, and
each Grantor hereby waives (to the extent permitted by law) all rights of
redemption, stay and appraisal which such Grantor now has or may at any time in
the future have under any rule of law or statute now existing or hereafter
enacted.
The Collateral Agent shall give each applicable Grantor 10 days'
written notice (which each Grantor agrees is reasonable notice within the
meaning of Section 9-611 of the New York UCC or its equivalent in other
jurisdictions) of the Collateral Agent's intention to make any sale of
Collateral. Such notice, in the case of a public sale, shall state the time and
place for such sale and, in the case of a sale at a broker's board or on a
securities exchange, shall state the board or exchange at which such sale is to
be made and the day on which the Collateral, or portion thereof, will first be
offered for sale at such board or exchange. Any such public sale shall be held
at such time or times within ordinary business hours and at such place or places
as the Collateral Agent may fix and state in the notice (if any) of such sale.
At any such sale, the Collateral, or portion thereof, to be sold may be sold in
one lot as an entirety or in separate parcels, as the Collateral Agent may (in
its sole and absolute discretion) determine. The Collateral Agent shall not be
obligated to make any sale of any Collateral if it shall determine not to do so,
regardless of the fact that notice of sale of such Collateral shall have been
given. The Collateral Agent may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned from time to time by
announcement at the time and place fixed for sale, and such sale may, without
further notice, be made at the time and place to which the same was so
adjourned. In case any sale of all or any part of the Collateral is made on
credit or for future delivery, the Collateral so sold may be retained
31
by the Collateral Agent until the sale price is paid by the purchaser or
purchasers thereof, but the Collateral Agent shall not incur any liability in
case any such purchaser or purchasers shall fail to take up and pay for the
Collateral so sold and, in case of any such failure, such Collateral may be sold
again upon like notice. At any public (or, to the extent permitted by law,
private) sale made pursuant to this Agreement, any Secured Party may bid for or
purchase, free (to the extent permitted by applicable law) from any right of
redemption, stay, valuation or appraisal on the part of any Grantor (all said
rights being also hereby waived and released to the extent permitted by
applicable law), the Collateral or any part thereof offered for sale and may
make payment on account thereof by using any claim then due and payable to such
Secured Party from any Grantor as a credit against the purchase price, and such
Secured Party may, upon compliance with the terms of sale, hold, retain and
dispose of such property without further accountability to any Grantor therefor.
For purposes hereof, a written agreement to purchase the Collateral or any
portion thereof shall be treated as a sale thereof; the Collateral Agent shall
be free to carry out such sale pursuant to such agreement and no Grantor shall
be entitled to the return of the Collateral or any portion thereof subject
thereto, notwithstanding the fact that after the Collateral Agent shall have
entered into such an agreement all Events of Default shall have been remedied
and the Obligations paid in full. As an alternative to exercising the power of
sale herein conferred upon it, the Collateral Agent may proceed by a suit or
suits at law or in equity to foreclose this Agreement and to sell the Collateral
or any portion thereof pursuant to a judgment or decree of a court or courts
having competent jurisdiction or pursuant to a proceeding by a court-appointed
receiver. Any sale pursuant to the provisions of this Section 5.01 shall be
deemed to conform to the commercially reasonable standards as provided in
Section 9-610(b) of the New York UCC or its equivalent in other jurisdictions.
SECTION 5.02. APPLICATION OF PROCEEDS. The Collateral Agent shall
apply the proceeds of any collection, sale, foreclosure or other realization
upon any Collateral, including any Collateral consisting of cash, and any
payment under the guarantee contained in this Agreement, as well as at the time
or times provided under Section 7.05, any amounts on deposit in the Special
Trust Account, as follows:
FIRST, to the payment of all costs and expenses incurred by the
Administrative Agents or the Collateral Agent (in their respective
capacities as such hereunder or under any other Loan Document) in
connection with such collection, sale, foreclosure or realization or
otherwise in connection with this Agreement, any other Loan Document or any
of the Obligations, including all court costs and the fees and expenses of
its agents and legal counsel, the repayment of all advances made by the
Collateral Agent or either of the Administrative Agents hereunder or under
any other Loan Document on behalf of any Grantor and any other costs or
expenses incurred in connection with the exercise of any right or remedy
hereunder or under any other Loan Document;
SECOND, to the payment in full of Unfunded Advances/Participations
(the amounts so applied to be distributed between or among the
Administrative Agents, Swingline Lender and any Issuing Bank pro rata in
accordance with the
32
amounts of Unfunded Advances/Participations owed to them on the date of any
such distribution);
THIRD, to the payment in full of all other Obligations (the amounts so
applied to be distributed among the Secured Parties pro rata in accordance
with the amounts of the Obligations owed to them on the date of any such
distribution); and
FOURTH, to the Grantors, their successors or assigns, or as a court of
competent jurisdiction may otherwise direct.
The Collateral Agent shall have absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Agreement. Upon any sale of Collateral by the Collateral Agent (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the Collateral Agent or of the officer making the sale shall be a
sufficient discharge to the purchaser or purchasers of the Collateral so sold
and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Collateral Agent
or such officer or be answerable in any way for the misapplication thereof.
SECTION 5.03. GRANT OF LICENSE TO USE INTELLECTUAL PROPERTY. For the
purpose of enabling the Collateral Agent to exercise rights and remedies under
this Agreement at such time as the Collateral Agent shall be lawfully entitled
to exercise such rights and remedies, each Grantor hereby grants to the
Collateral Agent an irrevocable, nonexclusive license (exercisable without
payment of royalty or other compensation to the Grantors), to use, license or
sublicense any of the Article 9 Collateral consisting of Intellectual Property
now owned or hereafter acquired by such Grantor, and wherever the same may be
located, and including in such license access to all media in which any of the
licensed items may be recorded or stored and to all computer software and
programs used for the compilation or printout thereof. The use of such license
by the Collateral Agent may be exercised, at the option of the Collateral Agent,
only upon the occurrence and during the continuation of an Event of Default;
provided, however, that any license, sublicense or other transaction entered
into by the Collateral Agent in accordance herewith shall be binding upon each
Grantor notwithstanding any subsequent cure of an Event of Default.
SECTION 5.04. SECURITIES ACT, ETC. In view of the position of the
Grantors in relation to the Pledged Collateral, or because of other current or
future circumstances, a question may arise under the U.S. Securities Act of
1933, as now or hereafter in effect, or any similar statute hereafter enacted
analogous in purpose or effect (such Act and any such similar statute as from
time to time in effect being called the "FEDERAL SECURITIES LAWS") with respect
to any disposition of the Pledged Collateral permitted hereunder. Each Grantor
understands that compliance with the Federal Securities Laws might very strictly
limit the course of conduct of the Collateral Agent if the Collateral Agent were
to attempt to dispose of all or any part of the Pledged Collateral, and might
also limit the extent to which or the manner in which any
33
subsequent transferee of any Pledged Collateral could dispose of the same.
Similarly, there may be other legal restrictions or limitations affecting the
Collateral Agent in any attempt to dispose of all or part of the Pledged
Collateral under applicable "blue sky" or other state securities laws or similar
laws analogous in purpose or effect. Each Grantor recognizes that in light of
such restrictions and limitations the Collateral Agent may, with respect to any
sale of the Pledged Collateral, limit the purchasers to those who will agree,
among other things, to acquire such Pledged Collateral for their own account,
for investment, and not with a view to the distribution or resale thereof. Each
Grantor acknowledges and agrees that in light of such restrictions and
limitations, the Collateral Agent, in its sole and absolute discretion (a) may
proceed to make such a sale whether or not a registration statement for the
purpose of registering such Pledged Collateral or part thereof shall have been
filed under the Federal Securities Laws and (b) may approach and negotiate with
a limited number of potential purchasers (including a single potential
purchaser) to effect such sale. Each Grantor acknowledges and agrees that any
such sale might result in prices and other terms less favorable to the seller
than if such sale were a public sale without such restrictions. In the event of
any such sale, the Collateral Agent shall incur no responsibility or liability
for selling all or any part of the Pledged Collateral at a price that the
Collateral Agent, in its sole and absolute discretion, may in good xxxxx xxxx
reasonable under the circumstances, notwithstanding the possibility that a
substantially higher price might have been realized if the sale were deferred
until after registration as aforesaid or if more than a limited number of
purchasers (or a single purchaser) were approached. The provisions of this
Section 5.04 will apply notwithstanding the existence of a public or private
market upon which the quotations or sales prices may exceed substantially the
price at which the Collateral Agent sells.
SECTION 5.05. PROVISIONS RELATING TO CASH COLLATERALIZATION OF L/C
EXPOSURE UNDER REVOLVING LOAN CREDIT AGREEMENT. Each party hereto acknowledges
that the Revolving Loan Credit Agreement contains provisions relating to the
Borrower's obligation, upon the occurrence of a Revolving Loan Event of Default,
to provide cash collateral in respect of the L/C Exposure thereunder at such
time. Notwithstanding anything to the contrary set forth herein, any moneys
deposited as cash collateral in any account established by the Collateral Agent
in accordance with Section 2.22(j) of the Revolving Loan Credit Agreement shall
(a) be applied by the Collateral Agent at the direction of the Revolving Loan
Administrative Agent to reimburse the Issuing Bank for L/C Disbursements for
which it has not been reimbursed, (b) be held for the satisfaction of the
reimbursement obligations of the Borrower for the L/C Exposure at such time and
(c) if the maturity of the any of the Loans has been accelerated (but subject to
the consent of Revolving Lenders holding participations in outstanding Letters
of Credit representing greater than 50% of the aggregate undrawn amount of all
outstanding Letters of Credit), be applied to satisfy the Obligations.
ARTICLE VI
ACTS OF SECURED PARTIES AND AGENTS; NOTICES OF DEFAULT AND ACCELERATION
SECTION 6.01. ACTS OF SECURED PARTIES AND AGENTS. All acts hereunder
(a) on the part of the Revolving Secured Parties shall be taken on their behalf
by the
34
Revolving Loan Administrative Agent and (b) on the part of the Term Loan Secured
Parties shall be taken on their behalf by the Term Loan Administrative Agent.
Any request, demand, authorization, direction, notice, consent, waiver or other
action permitted or required by this Agreement to be given or taken by any
Secured Party or the Majority Secured Parties, by the Revolving Loan
Administrative Agent on behalf of the Revolving Loan Secured Parties or by the
Term Loan Administrative Agent on behalf of the Term Loan Secured Parties may be
(and, at the request of the Collateral Agent, shall be) embodied in and
evidenced by one or more instruments reasonably satisfactory in form to the
Collateral Agent and signed by such Secured Party, the Majority Secured Parties,
the Revolving Loan Administrative Agent on behalf of the Revolving Loan Secured
Parties or the Term Loan Agent on behalf of the Term Loan Secured Parties,
acting individually or on behalf of the applicable Secured Parties, as the case
may be, and, except as otherwise expressly provided in any such instrument, any
such action shall become effective when such instrument or instruments shall
have been delivered to the Collateral Agent as provided herein. The instrument
or instruments evidencing any action (and the action embodied therein and
evidenced thereby) are sometimes referred to herein as an "ACT" of the persons
signing such instrument or instruments. The Collateral Agent shall be entitled
to rely absolutely upon (i) an Act of the Revolving Loan Administrative Agent if
such Act purports to be taken by or on behalf of the Revolving Loan Secured
Parties, (ii) an Act of the Term Loan Administrative Agent if such Act purports
to be taken on behalf of the Term Loan Secured Parties and (iii) an Act of any
Secured Party if given by such Secured Party, and nothing in this Section 6.01
or elsewhere in this Agreement shall be construed to require the Revolving Loan
Administrative Agent or the Term Loan Administrative Agent to demonstrate that
they have been authorized by the applicable Secured Parties to take any action
which they purport to be taking on behalf of such Secured Parties, the
Collateral Agent being entitled to rely conclusively without any independent
investigation whatsoever, and being fully protected in so relying, on any Act of
the Revolving Loan Administrative Agent on behalf of the Revolving Loan Secured
Parties and on any Act of the Term Loan Administrative Agent on behalf of the
Term Loan Secured Parties.
SECTION 6.02. DETERMINATION OF EXISTENCE OF EVENTS OF DEFAULT AND
ACCELERATION; NOTICES TO AGENTS. (a) The Revolving Loan Administrative Agent
shall promptly notify the Collateral Agent of any Revolving Loan Event of
Default of which it shall have been notified by any Revolving Loan Secured Party
or any acceleration of any of the Revolving Loan Obligations, and the Term Loan
Agent shall promptly notify the Collateral Agent of any Term Loan Event of
Default of which it shall have been notified by any Term Loan Secured Party or
any acceleration of any of the Term Loan Obligations; provided that failure to
give any such notice shall not affect any rights or remedies of the Collateral
Agent or any Secured Party hereunder or arising in connection with any such
acceleration.
(b) The Collateral Agent shall promptly (and in any event within three
Business Days after the receipt thereof) notify the Revolving Loan
Administrative Agent and the Term Loan Administrative Agent in the event it
shall receive from the Term Loan Administrative Agent or the Revolving Loan
Administrative Agent, as the case may be, (a) any notice of an Event of Default
(a "NOTICE OF DEFAULT"), (b) any instructions to
35
commence the exercise of remedies pursuant to Section 7.01(b), or (c) any notice
of the acceleration of any Revolving Loan Obligations or Term Loan Obligations.
ARTICLE VII
CERTAIN INTERCREDITOR PROVISIONS
SECTION 7.01. ACTIONS UNDER THIS AGREEMENT. (a) By acceptance of the
benefits of this Agreement, each of the Secured Parties shall be deemed
irrevocably to confirm that the Collateral Agent shall have the authority to act
as the exclusive agent of such Secured Party for enforcement of any provisions
of this Agreement against any Loan Party and of any other Security Document
against any "grantor", "guarantor" or "loan party" thereunder or the exercise of
remedies hereunder or under any other Security Document and to agree that such
Secured Party shall not take any action to enforce any provisions of this
Agreement (including the guarantee contained herein) against any Grantor or of
any of the other Security Documents against any "grantor", "guarantor" or "loan
party" thereunder or to exercise any remedy hereunder or under any other
Security Document.
(b) The Collateral Agent shall not be obligated to take any action
under this Agreement or the other Loan Documents except for the performance of
such duties and obligations as are specifically set forth herein and in the
other Loan Documents. The Collateral Agent shall take such actions and exercise
such remedies hereunder and under the other Security Documents as it is from
time to time instructed, in writing, to take or exercise by the Majority Secured
Parties (or such greater number or percentage of the Secured Parties as shall be
necessary under the circumstances as provided in Section 11.09 hereof), provided
that such actions or such exercise of remedies is not inconsistent with or
contrary to the provisions of this Agreement.
SECTION 7.02. RESTRICTIONS ON ACTIONS. Each Secured Party agrees that,
so long as any Obligations are outstanding, the provisions of this Agreement
shall provide the exclusive method by which any Secured Party may exercise
rights and remedies hereunder and under the other Security Documents in respect
of the guarantees and the Collateral. Therefore, each Secured Party shall, for
the mutual benefit of all Secured Parties, except as permitted under this
Agreement:
(a) refrain from taking or filing any action, judicial or
otherwise, to enforce any rights or pursue any remedy hereunder and
under any other Security Document, except for delivering notices
hereunder;
(b) refrain from (i) selling any Obligations to the Borrower or
any Affiliate of the Borrower and (ii) accepting any other guarantee
of, or any other security for, the Obligations from any Grantor or its
Affiliates, except for any guarantee or security granted to the
Collateral Agent for the benefit of all Secured Parties; and
36
(c) refrain from exercising any rights or remedies hereunder or
under any other Security Document that have or may have arisen or
which may arise as a result of an Event of Default;
provided, however, that nothing contained in this Section 7.02 shall prevent any
Secured Party from (i) imposing a default rate of interest in accordance with
the applicable Loan Documents, (ii) subject to the terms of the applicable
Credit Agreement, accelerating the maturity of any Obligations or terminating
any commitments under any Credit Agreement or, with respect to Revolving Loan
Credit Agreement, exercising any right thereunder to demand cash collateral, in
each case if any amounts received are paid over to the Collateral Agent to the
extent required under Section 7.05 for deposit in the Special Trust Account,
(iii) raising any defenses in any action in which it has been made a party
defendant or has been joined as a third party, except that the Collateral Agent
may direct and control any defense directly relating to the Collateral or any
one or more of the Security Documents, which shall be governed by the provisions
of this Agreement, or (iv) exercising any right of setoff, recoupment or similar
right (provided that such Secured Party shall promptly cause such amounts to be
delivered to the Collateral Agent to the extent required under Section 7.05 for
deposit in the Special Trust Account).
SECTION 7.03. COOPERATION; ACCOUNTINGS. Each of the Secured Parties
will, upon the reasonable request of the Collateral Agent, the Revolving Loan
Administrative Agent or the Term Loan Administrative Agent, from time to time
execute and deliver or cause to be executed and delivered such further
instruments, and do and cause to be done such further acts, as may be necessary
or proper to carry out more effectively the provisions of this Agreement. The
Secured Parties agree to provide to each other upon reasonable request a
statement of all payments received in respect of Obligations.
SECTION 7.04. OTHER COLLATERAL. The Secured Parties agree that all of
the provisions of this Agreement shall apply to any and all properties, assets
and rights of the Grantors and their controlled Affiliates in which the
Collateral Agent at any time acquires a security interest or Lien pursuant
hereto, any other Security Document or any other Loan Document, including real
property or rights in, on or over real property, notwithstanding any provision
to the contrary in any mortgage, leasehold mortgage or other document purporting
to grant or perfect any Lien in favor of the Secured Parties or any of them or
the Collateral Agent for the benefit of the Secured Parties.
SECTION 7.05. PREFERENTIAL PAYMENTS AND SPECIAL TRUST ACCOUNT. (a)
Each Secured Party agrees that if it shall receive a Preferential Payment it
will promptly, and in any event within three Business Days, notify the
Collateral Agent and deliver all amounts received by it as part of such
Preferential Payment to the Collateral Agent, which shall in turn deposit such
amounts in the Special Trust Account.
(b) If all Events of Default shall have been cured or waived, the
Collateral Agent shall return the amounts held in the Special Trust Account with
respect to such Preferential Payments, together with the interest earned
thereon, to each Secured Party initially entitled thereto. No payment returned
to a Secured Party for which such Secured
37
Party has been obligated to make a deposit into the Special Trust Account shall
thereafter ever be characterized as a Preferential Payment.
(c) If any of the Obligations have been accelerated, a Bankruptcy
Proceeding has been commenced by or against the Borrower or the Collateral Agent
has commenced to exercise remedies under this Agreement, then all funds,
together with interest earned thereon, held in the Special Trust Account and all
subsequent Preferential Payments shall be applied in accordance with the
provisions of Section 5.02.
SECTION 7.06. RESTORATION OF OBLIGATIONS. For the purposes of
determining the amount of any outstanding Obligations, if any Secured Party is
required to deposit any Preferential Payment in the Special Trust Account, then
the obligations to which such Preferential Payment related shall be reinstated,
as of the date of the deposit of such amount with the Collateral Agent, in the
amount of such Preferential Payment and such obligations shall continue in full
force and effect (and bear interest from such deposit date at the rate provided
in the underlying document) as if such Secured Party had not received such
payment. All such reinstated obligations shall be included as Obligations for
purposes of allocating any payments under Section 5.02 and for applying the
definition of Majority Secured Parties. If any such reinstated obligation shall
not be allowed as a claim under the Bankruptcy Code due to the fact that the
Preferential Payment has in fact been made or received, the Secured Parties
shall make such other equitable arrangements for the purchase and sale of
participations in the Obligations to effectuate the intent of this Section 7.06.
SECTION 7.07. BANKRUPTCY PREFERENCES. If any payment to a Secured
Party is subsequently invalidated, declared to be fraudulent or preferential or
set aside and is required to be repaid to a trustee, receiver or any other party
under any bankruptcy law, state or federal law, common law or equitable cause,
and such Secured Party has previously made a deposit in respect of such payment
into the Special Trust Account pursuant to Section 7.05, then the Collateral
Agent shall distribute to such Secured Party proceeds from the Special Trust
Account in an amount equal to such deposit or so much thereof as is affected by
such events and if, due to previous disbursements to the Secured Parties
pursuant to Section 7.05(c), the proceeds in the Special Trust Account are
insufficient for such purpose, then each other Secured Party shall pay to such
Secured Party upon demand an amount equal to a ratable portion of such
disbursements of the deposit which was distributed to each such Secured Party
according to the aggregate amounts so distributed to each such Secured Party.
SECTION 7.08. BANKRUPTCY PROCEEDINGS. The following provisions shall
apply during any Bankruptcy Proceeding of Holdings or any Subsidiary:
(a) The Collateral Agent shall represent all Secured Parties in
connection with all matters directly relating to the Collateral,
including, without limitation, any use, sale or lease of Collateral,
use of cash collateral, request for relief from the automatic stay and
request for adequate protection. The Collateral Agent shall act on the
instructions of the Majority Secured Parties; provided that no such
vote by the Majority
38
Secured Parties shall treat the Term Loan Secured Parties differently
with respect to rights in the Collateral from the Revolving Loan
Secured Parties or vice versa.
(b) Each Secured Party shall be free to act independently on any
issue not affecting the Collateral. Each Secured Party shall give
prior notice to the Collateral Agent of any such action that could
materially affect the rights or interests of the Collateral Agent or
the other Secured Parties to the extent that such notice is reasonably
practicable. If such prior notice is not given, such Secured Party
shall give prompt notice following any action taken hereunder.
(c) Any proceeds of the Collateral received by any Secured Party
as a result of, or during, any Bankruptcy Proceeding will be delivered
promptly to the Collateral Agent for distribution in accordance with
Section 5.02.
ARTICLE VIII
CONCERNING THE COLLATERAL AGENT
SECTION 8.01. APPOINTMENT OF COLLATERAL AGENT. Each of the Secured
Parties hereby irrevocably appoints Credit Suisse to act, and Credit Suisse,
agrees to act, as Collateral Agent for the Secured Parties pursuant to the terms
of this Agreement and the other Loan Documents, and authorizes the Collateral
Agent to take such actions on its behalf and to exercise such powers as are
delegated to the Collateral Agent by the terms of this Agreement and the other
Loan Documents, together with such actions and powers as are reasonably
incidental thereto. Without limiting the generality of the foregoing, the
Collateral Agent is hereby expressly authorized to execute any and all documents
(including releases) with respect to the Collateral, and the rights of the
Secured Parties with respect thereto, as contemplated by and in accordance with
the provisions of this Agreement and the other Security Documents.
SECTION 8.02. LIMITATIONS ON RESPONSIBILITY OF COLLATERAL AGENT. The
Collateral Agent shall have no duties or obligations except those expressly set
forth herein and in the other Loan Documents. Without limiting the generality of
the foregoing, (a) the Collateral Agent shall not be subject to any fiduciary or
other implied duties, regardless of whether a default under any Loan Document
has occurred and is continuing, (b) the Collateral Agent shall have no duty to
take any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated hereby that such agent is
instructed in writing to exercise by the Majority Secured Parties (or such
greater number or percentage of the Secured Parties as shall be necessary under
the circumstances as provided in Section 11.09 hereof), and (c) except as
expressly set forth herein and in the other Security Documents, the Collateral
Agent shall have no duty to disclose, nor shall it be liable for the failure to
disclose, any information relating to Holdings, the Borrower or any Subsidiary
that is communicated to or obtained by the bank serving as the Collateral Agent
or any of its Affiliates in any capacity. The
39
Collateral Agent shall not be liable for any action taken or not taken by it
with the consent or at the request of the Majority Secured Parties (or such
greater number or percentage of the Secured Parties as shall be necessary under
the circumstances as provided in Section 11.09 hereof) or in the absence of its
own gross negligence or willful misconduct. The Collateral Agent shall be deemed
to have no knowledge of any default under any Loan Document unless and until
written notice thereof is given to the Collateral Agent by any Secured Party or
any Loan Party, and the Collateral Agent shall not be responsible for or have
any duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with any Loan Document, (ii) the
contents of any certificate, report or other document delivered thereunder or in
connection therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth in any Loan
Document or (iii) the validity, enforceability, effectiveness or genuineness of
any Loan Document or any other agreement, instrument or document, other than to
confirm receipt of items expressly required to be delivered to such agent.
SECTION 8.03. RELIANCE BY COLLATERAL AGENT; INDEMNITY AGAINST
LIABILITIES, ETC. (a) The Collateral Agent shall be entitled to rely upon, and
shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing believed
by it to be genuine and to have been signed or sent by the proper person. The
Collateral Agent may also rely upon any statement made to it orally or by
telephone and believed by it to have been made by the proper person, and shall
not incur any liability for relying thereon. The Collateral Agent may consult
with legal counsel (who may be counsel for the Borrower), independent
accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such
counsel, accountants or experts.
(b) The Collateral Agent may perform any and all its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by it. The Collateral Agent and any such sub-agent may perform any and
all its duties and exercise its rights and powers by or through their respective
Related Parties. The exculpatory provisions of this Article shall apply to any
such sub-agent and to the Related Parties of the Collateral Agent and any such
sub-agent, and shall apply to their respective activities in connection with
activities as such agent.
SECTION 8.04. RESIGNATION OF THE COLLATERAL AGENT. Subject to the
appointment and acceptance of a successor Collateral Agent as provided below,
the Collateral Agent may resign at any time by notifying the Borrower, the
Revolving Loan Administrative Agent and the Term Loan Administrative Agent. Upon
any such resignation, the Majority Secured Parties shall have the right to
appoint a successor. If no successor shall have been so appointed by the
Majority Secured Parties and shall have accepted such appointment within 60 days
after the retiring Collateral Agent gives notice of its resignation, then the
retiring Collateral Agent may, on behalf of the Secured Parties, appoint a
successor agent which shall be a commercial bank with an office in New York, New
York, organized under the laws of the United States of America, any State
thereof or the District of Columbia and having a combined capital and surplus of
at least $500,000,000, or an Affiliate of any such bank. Unless otherwise agreed
to by the
40
Borrower, there shall only be one Collateral Agent at any time. Upon the
acceptance of its appointment as the Collateral Agent by a successor, such
successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Collateral Agent, and the retiring
Collateral Agent shall be discharged from its duties and obligations hereunder.
Such appointment and designation shall be full evidence of the right and
authority of such successor Collateral Agent to act as Collateral Agent
hereunder, and all Collateral, power, trusts, duties, documents, rights and
authority of the retiring Collateral Agent shall rest in the successor
Collateral Agent, without any further deed or conveyance. The retiring
Collateral Agent shall, nevertheless, on the written request of the Majority
Secured Parties or successor Collateral Agent, execute and deliver any other
such instrument transferring to such successor Collateral Agent all the
Collateral, properties, rights, power, trust, duties, authority and title of
such retiring Collateral Agent without any representations or warranties from
the retiring Collateral Agent to the successor Collateral Agent or the Secured
Parties. The Grantors shall execute and deliver any and all documents,
conveyances or instruments requested by the Majority Secured Parties or the
retiring Collateral Agent to reflect such transfer to the successor Collateral
Agent. After the Collateral Agent's resignation hereunder, the provisions of
this Article XIII and Section 11.06 shall continue in effect for the benefit of
such retiring Collateral Agent, its sub-agents and their respective Related
Parties in respect of any actions taken or omitted to be taken by any of them
while acting as Collateral Agent.
SECTION 8.05. DETERMINATION OF AMOUNTS OF OBLIGATIONS. Whenever the
Collateral Agent is required to determine the existence or amount of any of the
Obligations or the existence of any Event of Default for any purposes of this
Agreement, it shall request written certification of such existence or amount
from the Revolving Loan Administrative Agent or the Term Loan Administrative
Agent, as applicable, and shall be entitled to make such determination on the
basis of such certification; provided, however, that if, notwithstanding the
request of the Collateral Agent, the Revolving Loan Administrative Agent or the
Term Loan Administrative Agent, as applicable, shall fail or refuse reasonably
promptly to certify as to the existence or amount of any Obligation or the
existence of any Event of Default, the Collateral Agent shall be entitled to
determine such existence or amount by such method as the Collateral Agent may,
in the exercise of its good faith judgment, determine, including by reliance
upon a certificate of the Borrower. The Collateral Agent may rely conclusively,
and shall be fully protected in so relying, on any determination made by it in
accordance with the provisions of the preceding sentence (or as otherwise
directed by a court of competent jurisdiction) and shall have no liability to
the Borrower, any holder of any Obligation or any other person as a result of
such determination or any action taken pursuant thereto.
SECTION 8.06. AUTHORIZED INVESTMENTS. Any and all funds held by the
Collateral Agent in its capacity as Collateral Agent, whether pursuant to any
provision hereof or of any other Security Document or otherwise, shall to the
extent reasonably practicable be invested by the Collateral Agent within a
reasonable time in Cash Equivalent Investments. Any interest earned on such
funds shall be disbursed in accordance with Section 5.02 or Section 7.05, as
applicable. The Collateral Agent may hold any such funds in a common
interest-bearing account. To the extent that the interest
41
rate payable with respect to any such account varies over time, the Collateral
Agent may use an average interest rate in making the interest allocations among
the respective Secured Parties. The Collateral Agent shall have no duty to
select investments which provide a maximum return. In the absence of gross
negligence or willful misconduct, the Collateral Agent shall not be responsible
for any loss of any funds invested in accordance with this Section 8.06.
SECTION 8.07. CERTAIN POWERS RELATING TO COLLATERAL. Notwithstanding
any other provision set forth herein or any other Loan Document, nothing in this
Agreement or any other Loan Document shall require the creation or perfection of
pledges of or security interests in, or the obtaining of title insurance or
surveys with respect to, particular assets of Grantors if and for so long as, in
the judgment of the Collateral Agent, the cost of creating or perfecting, or
difficulties associated with holding or enforcing, such pledges or security
interests in such assets or obtaining title insurance or surveys in respect of
such assets shall be excessive in view of the benefits to be obtained by the
Secured Parties therefrom. The Collateral Agent may grant extensions of time for
the perfection of security interests in or the obtaining of title insurance with
respect to particular assets (including extensions beyond the Closing Date for
the perfection of security interests in the assets of the Grantors on such date)
where it determines that perfection cannot be accomplished without undue effort
or expense by the time or times at which it would otherwise be required by this
Agreement or the Loan Documents.
ARTICLE IX
REPRESENTATIONS AND WARRANTIES
Each party hereto represents and warrants to the other parties hereto
that (a) the execution, delivery and performance by it of this Agreement (i)
have been duly authorized by all requisite action on its part and (ii) will not
contravene any provision of its organizational documents or any law or
regulation or order of any court or other governmental authority having
applicability to it, and (b) this Agreement has been duly executed and delivered
by it and constitutes its legal, valid, binding and enforceable obligation,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws relating to or affecting generally the
enforcement of creditors' rights and except to the extent that availability of
the remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceeding thereof may be brought. Each
Revolving Lender shall be deemed to have represented to the other parties hereto
that this Agreement has been duly executed and delivered by the Revolving Loan
Administrative Agent on its behalf and constitutes its legal, valid, binding and
enforceable obligation, and each Term Lender shall be deemed to have represented
to the other parties hereto that this Agreement has been duly executed and
delivered by the Term Loan Administrative Agent on its behalf and constitutes
its legal, valid, binding and enforceable obligation.
42
ARTICLE X
INDEMNITY, SUBROGATION AND SUBORDINATION
SECTION 10.01. INDEMNITY AND SUBROGATION. In addition to all such
rights of indemnity and subrogation as the Guarantors may have under applicable
law (but subject to Section 10.03), the Borrower agrees that (a) in the event a
payment shall be made by any Guarantor under this Agreement, the Borrower shall
indemnify such Guarantor for the full amount of such payment and such Guarantor
shall be subrogated to the rights of the person to whom such payment shall have
been made to the extent of such payment and (b) in the event any assets of any
Guarantor shall be sold pursuant to this Agreement or any other Security
Document to satisfy in whole or in part a claim of any Secured Party, the
Borrower shall indemnify such Guarantor in an amount equal to the greater of the
book value or the fair market value of the assets so sold.
SECTION 10.02. CONTRIBUTION AND SUBROGATION. Each Guarantor (a
"CONTRIBUTING GUARANTOR") agrees (subject to Section 10.03) that, in the event a
payment shall be made by any other Guarantor hereunder in respect of any
Obligation, or assets of any other Guarantor shall be sold pursuant to any
Security Document to satisfy any Obligation owed to any Secured Party, and such
other Guarantor (the "CLAIMING GUARANTOR") shall not have been fully indemnified
by the Borrower as provided in Section 10.01, the Contributing Guarantor shall
indemnify the Claiming Guarantor in an amount equal to (i) the amount of such
payment or (ii) the greater of the book value or the fair market value of such
assets, as the case may be, in each case multiplied by a fraction of which the
numerator shall be the net worth of the Contributing Guarantor on the date
hereof and the denominator shall be the aggregate net worth of all the
Guarantors on the date hereof (or, in the case of any Guarantor becoming a party
hereto pursuant to Section 11.16, the date of the supplement hereto executed and
delivered by such Guarantor). Any Contributing Guarantor making any payment to a
Claiming Guarantor pursuant to this Section 10.02 shall be subrogated to the
rights of such Claiming Guarantor under Section 10.01 to the extent of such
payment.
SECTION 10.03. SUBORDINATION. (a) Notwithstanding any provision of
this Agreement to the contrary, all rights of the Guarantors under Sections
10.01 and 10.02 and all other rights of indemnity, contribution or subrogation
under applicable law or otherwise shall be fully subordinated to the
indefeasible payment in full in cash of the Obligations. No failure on the part
of the Borrower or any Guarantor to make the payments required by Sections 10.01
and 10.02 (or any other payments required under applicable law or otherwise)
shall in any respect limit the obligations and liabilities of any Guarantor with
respect to its obligations hereunder, and each Guarantor shall remain liable for
the full amount of its obligations hereunder.
(b) The Borrower and each Guarantor hereby agree that all Indebtedness
and other monetary obligations owed by it to the Borrower, any Subsidiary or any
Guarantor shall be fully subordinated to the indefeasible payment in full in
cash of the Obligations.
43
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. NOTICES. All communications and notices hereunder shall
(except as otherwise expressly permitted herein) be in writing and given as
provided in Section 9.01 of each Credit Agreement. All communications and
notices hereunder to any Guarantor shall be given to it in care of the Borrower
as provided in Section 9.01 of each Credit Agreement.
SECTION 11.02. SECURITY INTEREST ABSOLUTE. All rights of the
Collateral Agent hereunder, the Security Interest, the grant of a security
interest in the Pledged Collateral and all obligations of each Grantor hereunder
shall be absolute and unconditional irrespective of (a) any lack of validity or
enforceability of either Credit Agreement, any other Loan Document, any
agreement with respect to any of the Obligations or any other agreement or
instrument relating to any of the foregoing, (b) any change in the time, manner
or place of payment of, or in any other term of, all or any of the Obligations,
or any other amendment or waiver of or any consent to any departure from the
Agreement, any other Loan Document or any other agreement or instrument relating
to the foregoing, (c) any exchange, release or non-perfection of any Lien on
other collateral, or any release or amendment or waiver of or consent under or
departure from any guarantee, securing or guaranteeing all or any of the
Obligations, or (d) any other circumstance that might otherwise constitute a
defense available to, or a discharge of, any Grantor in respect of the
Obligations or this Agreement.
SECTION 11.03. SURVIVAL OF AGREEMENT. All covenants, agreements,
representations and warranties made by the Grantors in the Loan Documents and in
the certificates or other instruments prepared or delivered in connection with
or pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and the Issuing Bank and shall survive the
execution and delivery of the Loan Documents and the making of any Loans and
issuance of any Letters of Credit, regardless of any investigation made by any
Lender or Issuing Bank or on their behalf and notwithstanding that the
Collateral Agent, any Issuing Bank or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time any
credit is extended under the applicable Credit Agreement, and shall continue in
full force and effect as long as the principal of or any accrued interest on any
Loan or any fee or any other amount payable under any Loan Document is
outstanding and unpaid or the aggregate L/C Exposure does not equal zero and so
long as the Commitments have not expired or terminated.
SECTION 11.04. BINDING EFFECT; SEVERAL AGREEMENT. This Agreement shall
become effective as to any Grantor when a counterpart hereof executed on behalf
of such Grantor shall have been delivered to the Collateral Agent and a
counterpart hereof shall have been executed on behalf of the Collateral Agent,
and thereafter shall be binding upon such Grantor and the Collateral Agent and
their respective permitted successors and assigns, and shall inure to the
benefit of such Grantor, the Collateral Agent and the other Secured Parties and
their respective successors and assigns, except
44
that no Grantor shall have the right to assign or transfer its rights or
obligations hereunder or any interest herein or in the Collateral (and any such
assignment or transfer shall be void) except as expressly contemplated or
permitted by this Agreement or the Credit Agreements. This Agreement shall be
construed as a separate agreement with respect to each Grantor and may be
amended, modified, supplemented, waived or released with respect to any Grantor
without the approval of any other Grantor and without affecting the obligations
of any other Grantor hereunder.
SECTION 11.05. SUCCESSORS AND ASSIGNS. Whenever in this Agreement any
of the parties hereto is referred to, such reference shall be deemed to include
the permitted successors and assigns of such party; and all covenants, promises
and agreements by or on behalf of any Grantor or the Collateral Agent that are
contained in this Agreement shall bind and inure to the benefit of their
respective successors and assigns.
SECTION 11.06. COLLATERAL AGENT'S FEES AND EXPENSES; INDEMNIFICATION.
(a) The parties hereto agree that the Collateral Agent shall be entitled to
reimbursement of its expenses incurred hereunder as provided in Section 9.05 of
each Credit Agreement.
(b) Without limitation of its indemnification obligations under the
other Loan Documents, each Grantor jointly and severally agrees to indemnify the
Collateral Agent and the other indemnitees against, and hold each indemnitee
harmless from, any and all losses, claims, damages, liabilities, and related out
of pocket expenses, including the fees, charges and disbursements of not more
than one counsel in each relevant jurisdiction (unless any indemnitee asserts in
good faith that the nature of its claims requires it to be represented by
separate counsel), reasonably incurred by or asserted against any indemnitee
arising out of, in any way connected with, or as a result of, the execution,
delivery or performance of this Agreement or any agreement or instrument
contemplated hereby or any claim, litigation, investigation or proceeding
relating to any of the foregoing or to the Collateral, regardless of whether any
indemnitee is a party thereto or whether initiated by a third party or by a
Grantor or any Affiliate thereof; provided, however, that such indemnity shall
not, as to any indemnitee, be available for such losses, claims, damages,
liabilities or related expenses (x) to the extent determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted
primarily from the gross negligence or willful misconduct of such indemnitee,
(y) arising from such indemnitee's material breach of this Agreement or any
other Loan Document or (z) arising out of any claim, litigation, investigation
or proceeding that does not involve an act or omission of the Borrower or any of
its Affiliates and that is brought by an indemnitee against any other indemnitee
(other than the Administrative Agents, the Collateral Agent or any bookrunner or
lead arranger for the Credit Facilities, in each case, in its capacity as such).
To the extent permitted by applicable law, no Grantor shall assert, and each
Grantor hereby waives any claim against any indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
Transactions, any Loan or Letter of Credit or the use of proceeds thereof.
45
(c) Any such amounts payable as provided hereunder shall be additional
Obligations secured hereby and by the other Security Documents. The provisions
of this Section 11.06 shall remain operative and in full force and effect
regardless of the termination of this Agreement or any other Loan Document, the
consummation of the transactions contemplated hereby, the repayment of any of
the Obligations, the invalidity or unenforceability of any term or provision of
this Agreement or any other Loan Document, or any investigation made by or on
behalf of the Collateral Agent or any other Secured Party. All amounts due under
this Section 7.06 shall be payable on written demand therefor and shall bear
interest, on and from the date of demand, at the rate specified in Section
2.06(a) of the Term Loan Credit Agreement.
SECTION 11.07. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT. Each
Grantor hereby appoints the Collateral Agent as the attorney-in-fact of such
Grantor for the purpose of carrying out the provisions of this Agreement and
taking any action and executing any instrument that the Collateral Agent may
deem necessary or advisable to accomplish the purposes hereof, which appointment
is irrevocable and coupled with an interest. Without limiting the generality of
the foregoing, the Collateral Agent shall have the right, upon the occurrence
and during the continuance of an Event of Default, with full power of
substitution either in the Collateral Agent's name or in the name of such
Grantor (a) to receive, endorse, assign and/or deliver any and all notes,
acceptances, checks, drafts, money orders or other evidences of payment relating
to the Collateral or any part thereof, (b) to demand, collect, receive payment
of, give receipt for and give discharges and releases of all or any of the
Collateral, (c) to sign the name of any Grantor on any invoice or xxxx of lading
relating to any of the Collateral, (d) to send verifications of Accounts
Receivable to any Account Debtor, (e) to commence and prosecute any and all
suits, actions or proceedings at law or in equity in any court of competent
jurisdiction to collect or otherwise realize on all or any of the Collateral or
to enforce any rights in respect of any Collateral, (f) to settle, compromise,
compound, adjust or defend any actions, suits or proceedings relating to all or
any of the Collateral, (g) to notify, or to require any Grantor to notify,
Account Debtors to make payment directly to the Collateral Agent and (h) to use,
sell, assign, transfer, pledge, make any agreement with respect to or otherwise
deal with all or any of the Collateral, and to do all other acts and things
necessary to carry out the purposes of this Agreement in accordance with its
terms, as fully and completely as though the Collateral Agent were the absolute
owner of the Collateral for all purposes; provided, however, that nothing herein
contained shall be construed as requiring or obligating the Collateral Agent to
make any commitment or to make any inquiry as to the nature or sufficiency of
any payment received by the Collateral Agent, or to present or file any claim or
notice, or to take any action with respect to the Collateral or any part thereof
or the moneys due or to become due in respect thereof or any property covered
thereby. The Collateral Agent and the other Secured Parties shall be accountable
only for amounts actually received as a result of the exercise of the powers
granted to them herein, and neither they nor their officers, directors,
employees or agents shall be responsible to any Grantor for any act or failure
to act hereunder, except for their own gross negligence or willful misconduct.
46
SECTION 11.08. APPLICABLE LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
SECTION 11.09. WAIVERS; AMENDMENT. (a) No failure or delay by the
Collateral Agent in exercising any right or power hereunder or under any other
Loan Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Collateral Agent hereunder and under the other Security Documents are
cumulative and are not exclusive of any rights or remedies that it would
otherwise have. No waiver of any provision of any Security Document or consent
to any departure by any Loan Party therefrom shall in any event be effective
unless the same shall be permitted by paragraph (b) of this Section 11.09, and
then such waiver or consent shall be effective only in the specific instance and
for the purpose for which given. No notice or demand on any Loan Party in any
case shall entitle any Loan Party to any other or further notice or demand in
similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Collateral Agent and the Grantor with respect to which such
waiver, amendment or modification is to apply and consented to by the Majority
Secured Parties; provided, however, that (i) any amendment or waiver of this
Agreement that by its terms adversely affects the rights of the Revolving Loan
Secured Parties differently from those of the Term Loan Secured Parties shall
require the prior written consent of Required Lenders (as defined in the
Revolving Loan Credit Agreement), and any amendment or waiver of this Agreement
that by its terms adversely affects the rights of the Term Loan Secured Parties
differently from those of the Revolving Loan Secured Parties shall require the
prior written consent of the Required Lenders (as defined in the Term Loan
Credit Agreement), (ii) except as expressly provided in Section 11.15, any
amendment or waiver having the effect of a release of any guarantee hereunder or
all or substantially all of the Collateral from the Lien hereunder, and any
termination of this Agreement, in each case, shall require the prior written
consent of each Lender, (iii) any amendment to the Security Documents that
directly or indirectly narrows the description of the Collateral or the
obligations being secured thereby, changes the priority of payments to the
Secured Parties hereunder or under any other Security Document, amends the
definition of "Majority Secured Parties" or amends this Section 11.09 may be not
made without the prior written consent of each Lender and (iv) provisions solely
affecting the rights of the Secured Parties among themselves may be amended or
waived without the consent of any Grantor.
SECTION 11.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO
47
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 11.10.
SECTION 11.11. SEVERABILITY. In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby (it being understood that
the invalidity of a particular provision in a particular jurisdiction shall not
in and of itself affect the validity of such provision in any other
jurisdiction). The parties shall endeavor in good-faith negotiations to replace
the invalid, illegal or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.
SECTION 11.12. COUNTERPARTS. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original but all of which when taken together shall
constitute a single contract, and shall become effective as provided in Section
11.04. Delivery of an executed signature page to this Agreement by facsimile
transmission shall be as effective as delivery of a manually signed counterpart
of this Agreement.
SECTION 11.13. HEADINGS. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
SECTION 11.14. JURISDICTION; CONSENT TO SERVICE OF PROCESS. (a) Each
of the Grantors hereby irrevocably and unconditionally submits, for itself and
its property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America, sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or any other Loan Document, or for recognition or
enforcement of any judgment, and each of the Grantors hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the Grantors agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Loan Document shall
affect any right that the Collateral Agent, the Administrative Agents, Issuing
Bank or any Lender may otherwise have to bring any action or proceeding relating
to this Agreement or any other Loan Document against any Grantor or its
properties in the courts of any jurisdiction.
48
(b) Each of the Grantors hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any other
Loan Document in any court referred to in paragraph (a) of this Section 11.14.
Each of the Grantors hereby irrevocably waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such action
or proceeding in any such court.
(c) Each of the Grantors hereby irrevocably consents to service of
process in the manner provided for notices in Section 11.01. Nothing in this
Agreement or any other Loan Document will affect the right of the Collateral
Agent to serve process in any other manner permitted by law.
SECTION 11.15. TERMINATION OR RELEASE. (a) This Agreement, the
Guarantees, the Security Interest, the pledge of the Pledged Collateral and all
other security interests granted hereby shall terminate when all the Loan
Document Obligations have been indefeasibly paid in full and the Lenders have no
further commitment to lend under the Credit Agreements, the aggregate L/C
Exposure has been reduced to zero and the Issuing Bank has no further obligation
to issue Letters of Credit under the Credit Agreements.
(b) A Subsidiary Guarantor shall automatically be released from its
obligations hereunder and the Security Interests created hereunder in the
Collateral of such Subsidiary Guarantor shall be automatically released upon the
consummation of any transaction permitted by the Credit Agreements as a result
of which such Subsidiary Guarantor ceases to be a Subsidiary.
(c) Upon any sale or other transfer by any Grantor of any Collateral
that is permitted under the Credit Agreements to any person that is not the
Borrower or a Guarantor, or, upon the effectiveness of any written consent to
the release of the Security Interest granted hereby in any Collateral pursuant
to Section 9.08 of each Credit Agreement, the Security Interest in such
Collateral shall be automatically released.
(d) In connection with any termination or release pursuant to
paragraph (a), (b) or (c) above, the Collateral Agent shall promptly execute and
deliver to any Grantor, at such Grantor's expense, all Uniform Commercial Code
termination statements and similar documents that such Grantor shall reasonably
request to evidence such termination or release. Any execution and delivery of
documents pursuant to this Section 11.15 shall be without recourse to or
representation or warranty by the Collateral Agent or any Secured Party. Without
limiting the provisions of Section 11.06, the Borrower shall reimburse the
Collateral Agent upon demand for all costs and out of pocket expenses, including
the fees, charges and expenses of counsel, incurred by it in connection with any
action contemplated by this Section 11.15.
SECTION 11.16. ADDITIONAL SUBSIDIARIES. Pursuant to Section 5.12 of
each Credit Agreement, each Subsidiary (other than an Unrestricted Subsidiary)
that was not in existence or not a Subsidiary on the Closing Date is required to
enter into this
49
Agreement as a Guarantor and a Grantor upon becoming such a Subsidiary. Upon
execution and delivery by the Collateral Agent and such Subsidiary of a
supplement in the form of Exhibit A hereto, such Subsidiary shall become a
Guarantor and a Grantor hereunder with the same force and effect as if
originally named as a Guarantor and a Grantor herein. The execution and delivery
of any such instrument shall not require the consent of any other Grantor
hereunder. The rights and obligations of each Grantor hereunder shall remain in
full force and effect notwithstanding the addition of any new Grantor as a party
to this Agreement.
SECTION 11.17. RIGHT OF SETOFF. If an Event of Default shall have
occurred and is continuing, each Secured Party is hereby authorized at any time
and from time to time, to the fullest extent permitted by law, to set off and
apply any and all Collateral (including any deposits (general or special, time
or demand, provisional or final)) at any time held and other obligations at any
time owing by such Secured Party to or for the credit or the account of any
Grantor against any and all of the obligations of such Grantor now or hereafter
existing under this Agreement and the other Loan Documents held by such Secured
Party, irrespective of whether or not such Secured Party shall have made any
demand under this Agreement or any other Loan Document and although such
obligations may be unmatured. The rights of each Secured Party under this
Section 11.17 are in addition to other rights and remedies (including other
rights of setoff) which such Secured Party may have.
[Remainder of this page intentionally left blank]
50
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
NETWORK COMMUNICATIONS, INC.
by /s/ Xxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxx
----------------------------------
Title: CFO
---------------------------------
GALLARUS MEDIA HOLDINGS, INC.
by /s/ Xxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxx
----------------------------------
Title: CFO
---------------------------------
CREDIT SUISSE, CAYMAN ISLANDS BRANCH, as
Collateral Agent
by /s/ Xxxx X'Xxxx
-------------------------------------
Name: Xxxx X'Xxxx
----------------------------------
Title: Director
---------------------------------
by /s/ Xxxxxxxxx Xxxxxxx
-------------------------------------
Name: Xxxxxxxxx Xxxxxxx
----------------------------------
Title: Associate
---------------------------------
CREDIT SUISSE, CAYMAN ISLANDS BRANCH, as
Revolving Loan Administrative Agent
by /s/ Xxxx X'Xxxx
-------------------------------------
Name: Xxxx X'Xxxx
----------------------------------
Title: Director
---------------------------------
by /s/ Xxxxxxxxx Xxxxxxx
-------------------------------------
Name: Xxxxxxxxx Xxxxxxx
----------------------------------
Title: Associate
---------------------------------
51
CREDIT SUISSE, CAYMAN ISLANDS BRANCH, as
Term Loan Administrative Agent
by /s/ Xxxx X'Xxxx
-------------------------------------
Name: Xxxx X'Xxxx
----------------------------------
Title: Director
---------------------------------
by /s/ Xxxxxxxxx Xxxxxxx
-------------------------------------
Name: Xxxxxxxxx Xxxxxxx
----------------------------------
Title: Associate
---------------------------------
Schedule I to
the Guarantee and
Collateral Agreement
GUARANTORS
[To be provided]
Schedule II to
the Guarantee and
Collateral Agreement
EQUITY INTERESTS
Number and Percentage
Number of Registered Class of of Equity
Issuer Certificate Owner Equity Interest Interests
------ ----------- ---------- --------------- ----------
PLEDGED DEBT SECURITIES
Principal
Issuer Amount Date of Note Maturity Date
------ --------- ------------ -------------
Schedule III to
the Guarantee and
Collateral Agreement
U.S. COPYRIGHTS OWNED BY [NAME OR GRANTOR]
[Make a separate page of Schedule III for each Grantor and state if no
copyrights are owned. List in numerical order by Registration No.]
U.S. Copyright Registrations
Title Reg. No. Author
----- -------- ------
Pending U.S. Copyright Applications for Registration
Title Author Class Date Filed
----- ------ ----- ----------
Non-U.S. Copyright Registrations
[List in alphabetical order by country/numerical order by Registration No.
within each country.]
Country Title Reg. No. Author
------- ----- -------- ------
Non-U.S. Pending Copyright Applications for Registration
[List in alphabetical order by country.]
Country Title Author Class Date Filed
------- ----- ------ ----- ----------
III-2
LICENSES
[Make a separate page of Schedule III for each Grantor, and state if any Grantor
is not a party to a license/sublicense.]
I. Licenses/Sublicenses of [Name of Grantor] as Licensor/Sublicensor on Date
Hereof
A. Copyrights
[List U.S. copyrights in numerical order by Registration No. List non-U.S.
copyrights by country in alphabetical order with Registration Nos. within each
country in numerical order.]
U.S. Copyrights
Title of
Licensee Name Date of License/ U.S.
and Address Sublicense Copyright Author Reg. No.
------------- ---------------- --------- ------ --------
Non-U.S. Copyrights
Date of Title of
Licensee Name License/ Non-U.S.
Country and Address Sublicensee Copyrights Author Reg. No.
------- ------------- ----------- ---------- ------ --------
III-3
B. Patents
[List U.S. patent Nos. and U.S. patent application Nos. in numerical order. List
non-U.S. patent Nos. and non-U.S. application in alphabetical order by country,
with numbers within each country in numerical order.]
U.S. Patents
Licensee Name Date of License/
and Address Sublicense Issue Date Patent No.
------------- ---------------- ---------- ----------
U.S. Patent Applications
Licensee Name Date of License/
and Address Sublicense Date Filed Application No.
------------- ---------------- ---------- ---------------
Non-U.S. Patents
Licensee Name Date of License/ Issue Non-U.S.
Country and Address Sublicense Date Patent No.
------- ------------- ---------------- ----- ----------
Non-U.S. Patent Applications
Licensee Name Date of License/ Date
Country and Address Sublicense Filed Application No.
------- ------------- ---------------- ----- ---------------
III-4
C. Trademarks
[List U.S. trademark Nos. and U.S. trademark application Nos. in numerical
order. List non-U.S. trademark Nos. and non-U.S. application Nos. with trademark
Nos. within each country in numerical order.]
U.S. Trademarks
Licensee Name Date of License/
and Address Sublicense U.S. Xxxx Reg. Date Reg. No.
------------- ---------------- --------- ---------- --------
U.S. Trademark Applications
Licensee Name Date of License/
and Address Sublicense U.S. Xxxx Date Filed Application No.
------------- ---------------- --------- ---------- ---------------
Non-U.S. Trademarks
Licensee Name Date of License/ Non-U.S.
Country and Address Sublicense Xxxx Reg. Date Reg. No.
------- ------------- ---------------- -------- --------- --------
Non-U.S. Trademark Applications
Licensee Name Date of License/ Non-U.S. Date
Country and Address Sublicense Xxxx Filed Application No.
------- ------------- ---------------- -------- ----- ---------------
III-5
D. Others
Licensee Name Date of License/ Subject
and Address Sublicense Matter
------------- ---------------- -------
III-6
II. Licenses/Sublicenses of [Name of Grantor] as Licensee/Sublicensee on Date
Hereof
A. Copyrights
[List U.S. copyrights in numerical order by Registration No. List non-U.S.
copyrights by country in alphabetical order, with Registration Nos. within each
country in numerical order.]
U.S. Copyrights
Licensor Name and Date of License/ Title of
Address Sublicense U.S. Copyright Author Reg. No.
----------------- ---------------- -------------- ------ --------
Non-U.S. Copyrights
Date of Title of
Licensor Name License/ Non-U.S.
Country and Address Sublicensee Copyrights Author Reg. No.
------- ------------- ----------- ---------- ------ --------
III-7
B. Patents
[List U.S. patent Nos. and U.S. patent application Nos. in numerical order. List
non-U.S. patent Nos. and non-U.S. application Nos. in alphabetical order by
country with patent Nos. within each country in numerical order.]
U.S. Patents
Date of
Licensor Name License/
and Address Sublicense Issue Date Patent No.
------------- ---------- ---------- ----------
U.S. Patent Applications
Licensor Name Date of License/
and Address Sublicense Date Filed Application No.
------------- ---------------- ---------- ---------------
Non-U.S. Patents
Licensor Name Date of License/ Issue Non-U.S.
Country and Address Sublicense Date Patent No.
------- ------------- ---------------- ---- ----------
Non-U.S. Patent Applications
Licensor Name Date of License/ Date
Country and Address Sublicense Filed Application No.
------- ------------- ---------------- ----- ---------------
III-8
C. Trademarks
[List U.S. trademark Nos. and U.S. trademark application Nos. in numerical
order. List non-U.S. trademark Nos. and non-U.S. application Nos. with trademark
Nos. within each country in numerical order.]
U.S. Trademarks
Licensor Name Date of License/
and Address Sublicense U.S. Xxxx Reg. Date Reg. No.
------------- ---------------- --------- --------- --------
U.S. Trademark Applications
Licensor Name Date of License/ Date
and Address Sublicense U.S. Xxxx Filed Application No.
------------- ---------------- --------- ----- ---------------
Non-U.S. Trademarks
Licensor Name Date of License/ Non-U.S.
Country and Address Sublicense Xxxx Reg. Date Reg. No.
------- ------------- ---------------- -------- --------- --------
Non-U.S. Trademark Applications
Licensor Name Date of License/ Non-U.S. Date
Country and Address Sublicense Xxxx Filed Application No.
------- ------------- ---------------- -------- ----- ---------------
III-9
D. Others
Date of License/
Licensor Name and Address Sublicense Subject Matter
------------------------- ---------------- --------------
III-10
PATENTS OWNED BY [NAME OF GRANTOR]
[Make a separate page of Schedule III for each Grantor and state if no patents
are owned. List in numerical order by Patent No./Patent Application No.]
U.S. Patent Registrations
Patent No. Issue Date
---------- ----------
U.S. Patent Applications
Patent Application No. Filing Date
---------------------- -----------
Non-U.S. Patent Registrations
[List non-U.S. patents and non-U.S. patent applications by country in
alphabetical order, with patent Nos. and patent application Nos. within each
country in numerical order.]
Country Issue Date Patent No.
------- ---------- ----------
Non-U.S. Patent Applications
Country Filing Date Patent Application No.
------- ----------- ----------------------
III-11
TRADEMARK/TRADE NAMES OWNED BY [NAME OF GRANTOR]
[Make a separate page of Schedule III for each Grantor and state if no
trademarks/trade names are owned. List in numerical order by trademark
registration/application No.]
U.S. Trademark Registrations
Xxxx Reg. Date Reg. No.
---- --------- --------
U.S. Trademark Applications
Xxxx Filing Date Application No.
---- ----------- ---------------
State Trademark Registrations
[List in alphabetical order by state/numerical order by trademark No. within
each state]
State Xxxx Filing Date Application No.
----- ---- ----------- ---------------
Non-U.S. Trademark Registrations
[List non-U.S. trademarks and non-U.S. trademark applications by country in
alphabetical order, with Registration Nos. and application Nos. within each
country in numerical order.]
Country Xxxx Reg. Date Reg. No.
------- ---- --------- --------
III-12
Non-U.S. Trademark Applications
Country Xxxx Application Date Application No.
------- ---- ---------------- ---------------
Trade Names
Country(s) Where Used Trade Names
--------------------- -----------
Exhibit A to the
Guarantee and
Collateral Agreement
SUPPLEMENT NO. [_____] (this "SUPPLEMENT") dated as of
[_____], to the Guarantee, Collateral and Intercreditor Agreement
dated as of November 30, 2005 (the "GUARANTEE, COLLATERAL AND
INTERCREDITOR AGREEMENT"), among NETWORK COMMUNICATIONS, INC., a
Georgia corporation (the "BORROWER"), GALLARUS MEDIA HOLDINGS,
INC.., a Delaware corporation ("HOLDINGS"), each Subsidiary of
the Borrower from time to time party thereto (each such
subsidiary and Holdings individually a "GUARANTOR" and
collectively, the "GUARANTORS"; the Guarantors, Holdings and the
Borrower are referred to collectively herein as the "GRANTORS"),
CREDIT SUISSE ("CREDIT SUISSE"), as collateral agent (in such
capacity, the "COLLATERAL AGENT") for the Secured Parties (as
defined therein), CREDIT SUISSE, as administrative agent for the
Revolving Lenders (in such capacity, the "REVOLVING LOAN
ADMINISTRATIVE AGENT"), and CREDIT SUISSE, as administrative
agent for the Term Lenders (in such capacity, the "TERM LOAN
ADMINISTRATIVE AGENT").
A. Reference is made to (a) the Revolving Loan Credit Agreement dated
as of November 30, 2005 (as amended, restated, supplemented or otherwise
modified from time to time, the "REVOLVING LOAN CREDIT AGREEMENT"), among the
Borrower, Holdings, the lenders from time to time party thereto (the "REVOLVING
LENDERS"), the Revolving Loan Administrative Agent and the Collateral Agent, and
(b) the Term Loan Credit Agreement dated as of November 30, 2005 (as amended,
restated, supplemented or otherwise modified from time to time, the "TERM LOAN
CREDIT AGREEMENT" and, together with the Revolving Loan Credit Agreement, the
"CREDIT AGREEMENTS"), among the Borrower, Holdings, the lenders from time to
time party thereto (the "TERM LENDERS" and, together with the Revolving Lenders,
the "LENDERS"), the Term Loan Administrative Agent and the Collateral Agent.
B. Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to such terms in either Credit Agreement or the
Guarantee, Collateral and Intercreditor Agreement, as applicable.
C. The Grantors have entered into the Guarantee, Collateral and
Intercreditor Agreement in order to induce the Lenders to make Loans and the
Issuing Bank to issue Letters of Credit. Section 11.16 of the Guarantee,
Collateral and Intercreditor Agreement provides that additional Subsidiaries of
the Borrower may become Guarantors and Grantors under the Guarantee, Collateral
and Intercreditor Agreement by execution and delivery of an instrument in the
form of this Supplement. The undersigned Subsidiary (the "NEW SUBSIDIARY") is
executing this Supplement in accordance with the requirements of each Credit
Agreement to become a Guarantor and a
A-2
Grantor under the Guarantee, Collateral and Intercreditor Agreement in order to
induce the Lenders to make additional Loans and the Issuing Bank to issue
additional Letters of Credit and as consideration for Loans previously made and
Letters of Credit previously issued.
Accordingly, the Collateral Agent and the New Subsidiary agree as
follows:
SECTION 1. In accordance with Section 11.16 of the Guarantee,
Collateral and Intercreditor Agreement, the New Subsidiary by its signature
below becomes a Grantor and Guarantor under the Guarantee, Collateral and
Intercreditor Agreement with the same force and effect as if originally named
therein as a Grantor and Guarantor and the New Subsidiary hereby (a) agrees to
all the terms and provisions of the Guarantee and Collateral Agreement
applicable to it as a Grantor and Guarantor thereunder and (b) represents and
warrants that the representations and warranties made by it as a Grantor and
Guarantor thereunder are true and correct on and as of the date hereof. In
furtherance of the foregoing, the New Subsidiary, as security for the payment
and performance in full of the Obligations, does hereby create and grant to the
Collateral Agent, its successors and assigns, for the ratable benefit of the
Secured Parties, their successors and assigns, a security interest in and lien
on all of the New Subsidiary's right, title and interest in and to the
Collateral of the New Subsidiary. Each reference to a "Grantor" or a "Guarantor"
in the Guarantee, Collateral and Intercreditor Agreement shall be deemed to
include the New Subsidiary. The Guarantee, Collateral and Intercreditor
Agreement is hereby incorporated herein by reference.
SECTION 2. The New Subsidiary represents and warrants to the
Collateral Agent and the other Secured Parties that this Supplement has been
duly authorized, executed and delivered by it and constitutes its legal, valid
and binding obligation, enforceable against it in accordance with its terms.
SECTION 3. This Supplement may be executed in counterparts (and by
different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. This Supplement shall become effective when the Collateral
Agent shall have received counterparts of this Supplement that, when taken
together, bear the signatures of the New Subsidiary and the Collateral Agent.
Delivery of an executed signature page to this Supplement by facsimile
transmission shall be as effective as delivery of a manually signed counterpart
of this Supplement.
SECTION 4. The New Subsidiary hereby represents and warrants that (a)
set forth on Schedule I attached hereto is a true and correct schedule of (i)
any and all Equity Interests and Pledged Debt Securities now owned by the New
Subsidiary and (ii) any and all issued, registered, pending and otherwise
material Intellectual Property now owned by the New Subsidiary and (b) set forth
under its signature hereto, is the true and correct legal name of the New
Subsidiary and its jurisdiction of organization.
A-3
SECTION 5. Except as expressly supplemented hereby, the Guarantee and
Collateral Agreement shall remain in full force and effect.
SECTION 6. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 7. In case any one or more of the provisions contained in this
Supplement should be held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein and in the Guarantee and Collateral Agreement shall not in any way be
affected or impaired thereby (it being understood that the invalidity of a
particular provision in a particular jurisdiction shall not in and of itself
affect the validity of such provision in any other jurisdiction). The parties
hereto shall endeavor in good-faith negotiations to replace the invalid, illegal
or unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
SECTION 8. All communications and notices hereunder shall (except as
otherwise expressly permitted by the Guarantee and Collateral Agreement) be in
writing and given as provided in Section 9.01 of each Credit Agreement. All
communications and notices hereunder to the New Subsidiary shall be given to it
in care of the Borrower as provided in Section 9.01 of each Credit Agreement.
SECTION 9. The New Subsidiary agrees to reimburse the Collateral Agent
for its out of pocket expenses in connection with this Supplement, including the
fees, other charges and disbursements of counsel for the Collateral Agent.
[Remainder of this page intentionally left blank]
A-4
IN WITNESS WHEREOF, the New Subsidiary and the Collateral Agent have
duly executed this Supplement to the Guarantee and Collateral Agreement as of
the day and year first above written.
[NAME OF NEW SUBSIDIARY]
by
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Address:
-------------------------------
Legal Name:
----------------------------
Jurisdiction of Formation:
-------------
CREDIT SUISSE, CAYMAN ISLANDS BRANCH,
as Collateral Agent
by
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
by
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Schedule I to
Supplement No. [_____] to the
Guarantee and
Collateral Agreement
Collateral of the New Subsidiary
EQUITY INTERESTS
Number and
Number of Registered Class of Percentage
Issuer Certificate Owner Equity Interest of Equity Interests
------ ----------- ---------- --------------- -------------------
PLEDGED DEBT SECURITIES
Principal
Issuer Amount Date of Note Maturity Date
------ --------- ------------ -------------
INTELLECTUAL PROPERTY
Exhibit B to the
Guarantee and
Collateral Agreement
FORM OF PERFECTION CERTIFICATE
[Provided Separately]
