EXHIBIT A
DOLLAR NOTE
$______________ ________________, 20___
FOR VALUE RECEIVED, the undersigned, [BORROWER], a
_______________ corporation (the "Borrower"), promises to
pay to the order of _________________ (the "Lender") on
[February __, 2005] [December 31, 2004] the principal sum of
_____________________________ DOLLARS ($___________) as such
amount may be increased or decreased in accordance with
Section 2.2.4 of the Credit Agreement (as defined below), or
the aggregate unpaid principal amount of all _____________
Loans shown on the schedule attached hereto (and any
continuation thereof) or in the records of the Lender as
made by the Lender pursuant to the Credit Agreement;
provided, however, that the failure of the Lender to make
any notation on the attached schedule or in the Lender's
records shall not limit or otherwise affect the Obligations
of the Borrower hereunder or under the Credit Agreement.
The Borrower also promises to pay interest on the unpaid
principal amount hereof from time to time outstanding from
the date hereof until maturity (whether by acceleration or
otherwise) and, after maturity, until paid, at the rates per
annum and on the dates specified in that certain Second
Amended and Restated Credit Agreement dated as of February
___, 2000 (together with all further amendments and other
modifications, if any, from time to time thereafter made
thereto, the "Credit Agreement"), among the Borrower,
[Bairnco Corporation, a Delaware corporation ("Bairnco"),]
certain [other] subsidiaries of [Bairnco] [the Borrower],
BANK OF AMERICA, N.A., as Agent, SUNTRUST BANK, as
Syndication Agent and the various financial institutions
(including the Lender) as are, or may from time to time
become, parties thereto.
Payments of both principal and interest are to be made in
lawful money of the United States of America in same day or
immediately available funds to the account designated by the
Agent pursuant to the Credit Agreement.
This Note is one of the _____________ Notes referred to in,
and evidences Indebtedness incurred under, the Credit
Agreement, to which reference is made for a description of
the security for this Note and for a statement of the terms
and conditions on which the Borrower is permitted and
required to make prepayments and repayments of principal of
the Indebtedness evidenced by this Note and on which such
Indebtedness may be declared to be immediately due and
payable [and is issued, together with the other
_____________ Notes, to amend and restate without
interruption or novation, all indebtedness evidenced by the
_____________ Notes (as defined in the Original Credit
Agreement)]. Unless otherwise defined, terms used herein
have the meanings provided in the Credit Agreement.
All parties hereto, whether as makers, endorsers, or
otherwise, severally waive presentment for payment, demand,
protest and notice of dishonor.
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF THE BORROWER
AND LENDER HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL
LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW
OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES.
[BORROWER]
By:
Title:
_______ LOANS AND PRINCIPAL PAYMENTS
Amount of Amount of Unpaid
_________ Principal Principal
Repaid Balance
Loan Made
Alternate Interest Alternate Alternate
Reference Interbank Period (if Refernceate Interbank Reference Interbank Notation
Date Rate Rate Applicable Rate Rate Rate Rate Made By
EXHIBIT B
FOREIGN NOTE
$________________ ________________, 20___
FOR VALUE RECEIVED, the undersigned, [BORROWER], a
___________ corporation (the "Borrower"), promises to pay
to the order of Bank of America, N.A.. (the "Lender") on
February ___, 2005 the principal sum of the equivalent
amount in [FOREIGN CURRENCY] or Euro of __________________
or the aggregate principal amount of the loans made in
[FOREIGN CURRENCY] or Euro of all ___________ Loans shown
on the schedule attached hereto (and any continuation
thereof) or in the records of the Lender as made by the
Lender pursuant to the Credit Agreement (as defined below);
provided, however, that the failure of the Lender to make
any notation on the attached schedule or in the Lender's
records shall not limit or otherwise affect the Obligations
of the Borrower hereunder or under the Credit Agreement.
The Borrower also promises to pay interest on the unpaid
principal amount hereof from time to time outstanding from
the date hereof until maturity (whether by acceleration or
otherwise) and, after maturity, until paid, at the rates
per annum and on the dates specified in the that certain
Second Amended and Restated Credit Agreement dated as of
February ___, 2000 (together with all further amendments
and other modifications, if any, from time to time
thereafter made thereto, the "Credit Agreement"), among the
Borrower, Bairnco Corporation, a Delaware corporation
("Bairnco"), certain [other] subsidiaries of Bairnco, BANK
OF AMERICA, N.A., as Agent, SUNTRUST BANK, as Syndication
Agent, and the various financial institutions (including
the Lender) as are, or may from time to time become,
parties thereto.
Payments of both principal and interest are to be made
in lawful money of [SPECIFY APPLICABLE COUNTRY] in same day
or immediately available funds to the account designated by
the Agent pursuant to the Credit Agreement.
This Note is one of the ______________ Notes referred to
in, and evidences Indebtedness incurred under, the Credit
Agreement, to which reference is made for a description of
the security for this Note and for a statement of the terms
and conditions on which the Borrower is permitted and
required to make prepayments and repayments of principal of
the Indebtedness evidenced by this Note and on which such
Indebtedness may be declared to be immediately due and
payable and is issued, together with the other
_____________ Notes, to amend and restate without
interruption or novation, all indebtedness evidenced by the
_____________ Notes (as defined in the Original Credit
Agreement). Unless otherwise defined, terms used herein
have the meanings provided in the Credit Agreement.
All parties hereto, whether as makers, endorsers, or
other wise, severally waive presentment for payment,
demand, protest and notice of dishonor.
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF THE
BORROWER AND LENDER HEREUNDER SHALL BE GOVERNED BY, AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES.
[BORROWER]
By:
Title:
________ LOANS AND PRINCIPAL PAYMENTS
Amount of Amount of Unpaid
Loan Made Principal Repaid Principal Balance
Interest Notation
Date Period Total Made By
EXHIBIT C
LETTER OF CREDIT NOTE
$______________ ________________, 20___
FOR VALUE RECEIVED, the undersigned, BAIRNCO
CORPORATION, a Delaware corporation (the
"Borrower"), promises to pay to the order of (the
"Lender") on February ___, 2005 the principal sum of
____________________________DOLLARS ($___________) as
such amount may be increased or decreased in
accordance with Section 2.2.4 of the Credit Agreement
(as defined below), or the aggregate unpaid principal
amount of all Letter of Credit Loans shown on the
schedule attached hereto (and any continuation
thereof) or in the records of the Lender as made by
the Lender pursuant to the Credit Agreement;
provided, however, that the failure of the Lender to
make any notation on the attached schedule or in the
Lender's records shall not limit or otherwise affect
the Obligations of the Borrower hereunder or under
the Credit Agreement.
The Borrower also promises to pay interest on the
unpaid principal amount hereof from time to time
outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after
maturity, until paid, at the rates per annum and on
the dates specified in that certain Second Amended
and Restated Credit Agreement dated as of February
___, 2000 (together with all further amendments and
other modifications, if any, from time to time
thereafter made thereto, the "Credit Agreement"),
among the Borrower, [Bairnco Corporation, a Delaware
corporation ("Bairnco"),] certain [other]
subsidiaries of [Bairnco] [the Borrower], BANK OF
AMERICA, N.A., as Agent, SUNTRUST BANK, as
Syndication Agent and the various financial
institutions (including the Lender) as are, or may
from time to time become, parties thereto.
Payments of both principal and interest are to
be made in lawful money of the United States of
America in same day or immediately available funds to
the account designated by the Agent pursuant to the
Credit Agreement.
This Note is one of the Letter of Credit Notes
referred to in, and evidences Indebtedness incurred
under, the Credit Agreement, to which reference is
made for a description of the security for this Note
and for a statement of the terms and conditions on
which the Borrower is permitted and required to make
prepayments and repayments of principal of the
Indebtedness evidenced by this Note and on which such
Indebtedness may be declared to be immediately due
and payable and is issued, together with the other
Letter of Credit Notes, to amend and restate without
interruption or novation, all indebtedness evidenced
by the Letter of Credit Notes (as defined in the
Original Credit Agreement). Unless otherwise defined,
terms used herein have the meanings provided in the
Credit Agreement.
.All parties hereto, whether as makers,
endorsers, or
otherwise, severally waive presentment for payment,
demand, protest and notice of dishonor.
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF THE
BORROWER AND LENDER HEREUNDER SHALL BE GOVERNED BY,
AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF
THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES.
[BORROWER]
By:
Title
LETTER OF CREDIT LOANS AND PRINCIPAL PAYMENTS
Amount of
Letter of Credit Amount of Unpaid
Loan Made Principal Repaid Principle Balance
Alternate Interest Alternate Alternate
Reference Interbank Period (if Reference Interbank Reference Interbank Notation
Date Rate Rate applicable) Rate Rate Rate Rate Made By
EXHIBIT D
BORROWING REQUEST
Bank of America, N.A., as Agent
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: (Name]
[Title]
[Xxxxxxxx's Name]
Ladies and Gentlemen:
This Borrowing Request is delivered to you pursuant to
Section 2.3 of the Second Amended and Restated Credit
Agreement, dated as of February ___, 2000 (together
with all amendments, if any, from time to time made
thereto, the "Credit Agreement"), among Bairnco
Corporation and certain of its Subsidiaries as the
Borrowers, certain commercial lending institutions as
the Lenders, Bank of America, N.A., as Agent (the
"Agent") and SunTrust Bank, as Syndication Agent.
Unless otherwise defined herein or the context
otherwise requires, terms used herein have the
meanings provided in the Credit Agreement.
The Borrower hereby requests that a
__________________ Loan be made in the aggregate
principal amount of ___________________ [specify
currency] on _________________, 200__ as a [Euro Rate
Loan [specify type] having an Interest Period of ____
months] [Reference Rate Loan].
The Borrower hereby acknowledges that, pursuant
to Section 5.2.2 of the Credit Agreement, each of the
delivery of this Borrowing Request and the acceptance
by the Borrower of the proceeds of the Loans
requested hereby constitute a representation and
warranty by the Borrower that, on the date of such
Loans, and before and after giving effect thereto and
to the application of the proceeds therefrom, all
statements set forth in Section 5.2.1 are true and
correct in all material respects.
The Borrower agrees that if prior to the time of
the
Borrowing requested hereby any matter certified to
herein by it will not be true and correct at such
time as if then made, it will immediately so notify
the Agent. Except to the extent, if
any, that prior to the time of the Borrowing
requested hereby the Agent shall receive written
notice to the contrary from the Borrower, each matter
certified to herein shall be deemed once again to be
certified as true and correct at the date of such
Borrowing as if then made.
Please wire transfer the proceeds of the
Borrowing to the accounts of the following persons at
the financial institutions indicated respectively:
Amount to be Person to be Paid Name, Address, etc.
Transferred Name Account No. of Transferee Bank
$
Attention:
$
Attention:
Balance of such The Borrower
proceeds Attention:
The Borrower has caused this Borrowing Request
to be executed and delivered, and the certification
and warranties contained herein to be made, by its
duly Authorized Officer this ___ day of
___________________, 200__.
[Xxxxxxxx's Name]
By:
EXHIBIT E
CONTINUATION/CONVERSION NOTICE
Bank of America, N.A., as Agent
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: [Name]
[Title]
[Xxxxxxxx's Name]
Ladies and Gentlemen:
This Continuation/Conversion Notice is delivered
to you pursuant to Section 2.4 of the Second Amended
and Restated Credit Agreement, dated as of February
___, 2000 (together with all amendments, if any, from
time to time made thereto, the "Credit Agreement"),
among Bairnco Corporation and certain of its
Subsidiaries as the Borrowers, certain commercial
lending institutions as the Lenders, Bank of America,
N.A., as Agent (the "Agent") and SunTrust Bank, as
Syndication Agent. Unless otherwise defined herein or
the context otherwise requires, terms used herein
have the meanings provided in the Credit Agreement.
The Borrower hereby requests that on _______________,
200___,
(1) ___________ [specify currency] of the
presently outstanding principal amount of the
____ Loans originally made on ________________,
[19][20]___ [and ____________________ [specify
currency] of the presently outstanding
principal amount of the ______ Loans originally
made on ____________, [19][20]___],
(2) and all presently being maintained as
[Reference Rate Loans] [Interbank Rate Loans]
[Sterling Loans] [FF
Loans] [DM Loans],
(3) be [converted into] [contained as ],
(4) [____________ Loans having an
Interest Period of ____ months] [Reference
Rate Loans].
The Borrower hereby:
(a) certifies and warrants that no
Default has occurred and is continuing; and
(b) agrees that if prior to the time of
such continuation or conversion any matter
certified to herein by it will not be true and
correct at such time as if then made, it will
immediately so notify the Agent.
Except to the extent, if any, that prior to the time
of the continuation or conversion requested hereby
the Agent shall receive written notice to the
contrary from the Borrower, each matter certified to
herein shall be deemed to be certified at the date of
such continuation or conversion as if then made.
The Borrower has caused this
Continuation/Conversion Notice to be executed and
delivered, and the certification and warranties
contained herein to be made, by its Authorized
Officer this ____day of ___________, 200__.
[XXXXXXXX'S NAME]
By:
Title:
EXHIBIT G
BAIRNCO CORPORATION
Compliance Certificate
Quarter Ended [ ]
Reference is made to that certain Second Amended and
Restated Credit Agreement dated as of
, 2000, among Bairnco
Corporation, certain of its subsidiaries as
Borrowers, certain financial institutions as Lenders,
Bank of America, N.A., as Agent, and SunTrust Bank,
as Syndication Agent, as amended, supplemented or
otherwise modified from time to time (the "Credit
Agreement"). Capitalized terms used herein without
definition shall have the same respective meanings
ascribed thereto in the Credit Agreement.
Pursuant to Section 7.1.1(c) of the Credit
Agreement, the Borrowers HEREBY CERTIFY THAT:
No Default. As of the date hereof, no Default under
the
Credit Agreement has occurred and is continuing,
except as set forth below (If no exceptions, state
"None"):
Net Worth (Section 7.2.3(a))
A. Net Worth
(a) Aggregate Par Value of Outstanding Shares $
(b) Paid-in-Capital (excluding cumulative
translation adjustment since 12/31/96) $
(c) Retained Earnings $
(d) Treasury Stock $
(e) Subordinated Debt with No Put Option $
Sum of (a) + (b) + (c) + (e) less (d) $
B. Cumulative Net Income since 12/31/99 $
X. Xxxxxxxx of Bairnco Stock (other than the
proceeds of the issuance of stock to
directors or employees pursuant to the
exercise of stock options) since 12/31/99 $
D. Credit Agreement Requirements:
Net Worth (A) not to be less than:
(a) $40,000,000 plus
(b) 60% of Cumulative Net Income since
12/31/99 (B) plus
(c) 60% of net cash proceeds of Bairnco
stock sold since 12/31/99 (C) $
Compliance Indicated
Debt to Capital Ratio (Section 7.2.3(b))
E. Consolidated Funded Debt $
F. Stockholders' Investment $
G. Sum of A + B $
H. Ratio of A to C
I. Credit Agreement Requirement requires, for
any fiscal quarter ending on or before
12/31/01, not Greater Than: 65.0%
J. Credit Agreement Requirement requires, for
any fiscal quarter ending after
12/31/01, not Greater Than: 60.0%
Compliance Indicated
Interest Coverage Ratio (Section 7.2.3(c))
K. Consolidated Earnings Before Interest $
Expense and Taxes for the fiscal
quarter ended [ ], excluding
non-recurring gains and charges
L. Consolidated Interest Expense for $
Indebtedness for the fiscal
quarter ended [ ]
M. Ratio of A to B
N. Credit Agreement Requires Not Less Than: 2.50:1.00
Compliance Indicated
IN WITNESS WHEREOF, the undersigned has executed this
certificate on behalf of the Borrowers as of the
______ day of __________, ____.
BAIRNCO
CORPORATION
By:
Name:
Title:
EXHIBIT H
FORM OF ASSIGNMENT AND ACCEPTANCE
TO: Bairnco Corporation and certain of its Subsidiaries
000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxx Xxxx, Xxxxxxx 00000
TO: Bank of America, N.A.
as the Agent
Re: Bairnco Corporation and certain of its
subsidiaries
Gentlemen and Ladies:
We refer to Section 10.11.1 of the Second Amended and
Restated Credit Agreement, dated as of February 22,
2000 (together with all amendments and other
modifications, if any, from time to time thereafter
made thereto, the "Credit Agreement") among Bairnco
Corporation and certain of its Subsidiaries, as the
Borrowers (collectively referred to herein as the
"Borrower"), the various financial institutions (the
"Lenders") as are, or shall from time to time become,
parties thereto, Bank of America, N.A., as agent (the
"Agent") for the Lenders and SunTrust Bank, as
syndication agent. Unless otherwise defined herein or
the context otherwise requires, terms used herein
have the meanings provided in the Credit Agreement.
This agreement is delivered to you pursuant to
clause (B) of Section 10.11.1(b) of the Credit
Agreement and also constitutes
notice to each of you, pursuant to clause (A) of
Section 10.11.1(b) of the Credit Agreement, of the
assignment and delegation to ______________________
(the "Assignee") of _____% of [the Loans and
Commitment] [the ______________ Loans and
_____________ Commitment] of
______________________________ (the "Assignor")
outstanding under the Credit Agreement on the date
hereof. After giving effect to the foregoing
assignment and delegation, the Assignor's and the
Assignee's Percentage for the purposes of the Credit
Agreement are set forth opposite such Person's name
on the signature pages hereof.
[Add paragraph dealing with accrued interest
and fees with respect to Loans assigned.]
The Assignee hereby acknowledges and confirms
that it has received a copy of the Credit Agreement
and the exhibits related thereto, together with
copies of the documents which were required to be
delivered under the Credit Agreement as a condition
to the making of the Loans thereunder. The Assignee
further confirms and agrees that in becoming a Lender
and in making its Commitment and Loans under the
Credit Agreement, such actions have and will be made
without recourse or representation to or warranty by
the Agent.
Except as otherwise provided in the Credit
Agreement, effective as of the date of acceptance
hereof by the Agent
(a) the Assignee
(i) shall be deemed automatically to
have become
a party to the Credit Agreement, have all
the rights and obligations of a "Lender"
under the Credit Agreement and the other
Loan Documents as if it were
an original signatory thereto to the
extent specified in the second paragraph
hereof; and
(ii) agrees to be bound by the terms
and conditions set forth in the Credit
Agreement and the other Loan Documents as
if it were an original signatory thereto;
and
(b) the Assignor shall be released from its
obligations under the Credit Agreement and the
other Loan Documents to the extent specified in
the second paragraph hereof.
The Assignor and the Assignee hereby agree that
the [Assignor] [Assignee] will pay to the Agent the
processing fee referred to in Section 10.1.1 of the
Credit Agreement upon the delivery thereof.
The Assignee hereby advises each of you of the
following administrative details with respect to the
assigned Loans and Commitment and requests the Agent
to acknowledge receipt of this document:
(A) Address for Notices:
Institution Name:
Attention:
Domestic Office:
Telephone:
Facsimile:
Telex (Answerback):
LIBOR Office:
IN WITNESS WHEREOF, the undersigned has executed this
Assignment Agreement as of the ____ day of
_________________, 2000.
[NAME OF ASSIGNEE]
By:
Name:
Title:
[NAME OF ASSIGNOR]
By:
Name:
Title:
EXHIBIT I
AMENDED AND RESTATED GUARANTY
THIS AMENDED AND RESTATED GUARANTY (this
"Guaranty") dated as of February 22, 2000 is
executed by Bairnco Corporation, a Delaware
corporation ("Bairnco"), each of its undersigned
Subsidiaries and each other Subsidiary of Bairnco
that may become a party hereto in accordance with
Section 13 hereof (Bairnco and each such Subsidiary
of Bairnco collectively hereinafter referred to as
the "Guarantors" and individually as a "Guarantor")
in favor of BANK OF AMERICA, N.A., ("Bank of
America"; the successor by merger to Bank of America
Illinois, formerly known as Continental Bank, N.A.),
as Agent (as hereinafter defined in the first recital
below) and amends and restates in its entirety that
certain Guaranty dated as of September 27, 1990 (as
amended, restated, supplemented or otherwise modified
as of the date hereof, the "Existing Guaranty"), by
Bairnco, Xxxxx, Inc., a Delaware corporation
("Xxxxx") , Kasco Corporation, a Delaware corporation
("Kasco"), Shielding Systems Corporation, a Delaware
corporation and other subsidiaries of Bairnco party
thereto as of the date hereof in favor of Bank of
America, as agent.
RECITALS
WHEREAS, Bairnco Corporation ("Bairnco"), certain of its
Subsidiaries, certain lenders (the "Lenders") and
Bank of America, as agent for the Lenders (the
"Agent"), have entered into that certain Second
Amended and Restated Credit Agreement dated as of
February 22, 2000 (as the same may be amended,
restated, supplemented or otherwise modified from
time to time, hereinafter referred to as the "Credit
Agreement") pursuant to which the Lenders have
extended credit to Bairnco and certain of its
Subsidiaries (each capitalized term used but not
defined herein shall have the meaning assigned
thereto in the Credit Agreement);
WHEREAS, it is a condition precedent to the
Lenders amending and restating the Credit Agreement
on the date hereof that the Existing Guaranty be
amended and restated as herein provided; and
WHEREAS, each Guarantor has received and will
receive substantial benefits from the extension of
credit pursuant to the Credit Agreement;
NOW, THEREFORE, in order to induce the Lenders
to enter into the Credit Agreement, each Guarantor
hereby covenants as follows:
1. Guaranty.
(a) Subject to Section 1(b), each
Guarantor hereby unconditionally guarantees the
performance and the full and prompt payment when due,
whether by acceleration or otherwise, and at all
times thereafter, of all Obligations (except such
Guarantor's Obligations as a Borrower) under and in
connection with the Loan Documents (all such
obligations being hereinafter collectively called the
"Guaranteed Liabilities").
(b) The liability of each of the Guarantors under this
Guaranty shall not exceed the maximum amount of
liability that such Guarantor can hereby incur
without rendering this Guaranty voidable under
applicable law relating to fraudulent conveyance or
fraudulent transfer, and not for any greater amount.
For purposes of determining such liability of each of
the Guarantors, due consideration shall be given to
the direct and indirect benefits received by each of
the Guarantors as a result of the extension of credit
under the Credit Agreement.
(c) This Guaranty shall in all respects be a continuing,
absolute and unconditional guaranty, and shall remain
in full force and effect notwithstanding the
dissolution of any Guarantor or that at any time or
from time to time all Guaranteed Liabilities may have
been paid in full.
2. Disgorged Payments. Each Guarantor further
agrees that, if at any time all or any part of any
payment theretofore applied by the Agent or the
Lenders to any of the Guaranteed Liabilities is or
must be rescinded or returned by the Agent or the
Lenders for any reason whatsoever (including, without
limitation, the insolvency, bankruptcy or
reorganization of any Company), such Guaranteed
Liabilities shall, for the purposes of this Guaranty,
to the extent that such payment is or must be
rescinded or returned, be deemed to have continued in
existence, notwithstanding such application by the
Agent or the Lenders, and this Guaranty shall
continue to be effective or be reinstated, as the
case may be, as to such Guaranteed Liabilities, all
as though such application by the Agent or the
Lenders had not been made.
3. Certain Permitted Actions. To the extent permitted
by law, each of the Agent and any Lender each may,
from time to time, whether before or after any
discontinuance of this Guaranty, at its sole
discretion and without notice to any Guarantor or any
other Person, take any or all of the following
actions without impairing its rights arising hereunder: (a) retain
or obtain a lien upon or a security interest in any
property to secure any of the Guaranteed Liabilities,
(b) retain or obtain the primary or secondary
obligation of any obligor or obligors, in addition to
such Guarantors' obligations, with respect to any of
the Guaranteed Liabilities, (c) extend or renew for
one or more periods (whether or not longer than the
original period), alter or exchange any of the
Guaranteed Liabilities, or release or compromise any
obligation of any Borrower under any Loan Document or
any obligation of any nature of any other obligor
with respect to any of the Guaranteed Liabilities,
(d) release or fail to perfect its lien upon or
security interest in, or impair, surrender, release
or permit any substitution or exchange for, all or
any part of any property securing any of the
Guaranteed Liabilities, or extend or renew for one or
more periods (whether or not longer than the original
period) or release, compromise, alter or exchange any
obligations of any nature of any obligor with respect
to any such property, and (e) resort to any Guarantor
for payment of any of the Guaranteed Liabilities,
whether or not the Agent or the Lenders (i) shall
have resorted to any property securing any of the
Guaranteed Liabilities or (ii) shall have proceeded
against any other obligor primarily or secondarily
obligated with respect to any of' the Guaranteed
Liabilities (all of the actions referred to in
preceding
clauses (i) and (ii) being hereby expressly waived by
each Guarantor).
4. Application of Funds. Any amounts received by the
Agent or the Lenders from whatsoever source on
account of the Guaranteed Liabilities may be applied
by it toward the payment of such of the Guaranteed
Liabilities, and in such order of application, as the
Agent and the Lenders may from time to time elect.
5. Limit on Subrogation; Waivers.
(a) No payment made
by or for the account of any Guarantor pursuant to this
Guaranty shall entitle any Guarantor by subrogation
or otherwise to any payment by any Borrower or by any
Guarantor or from or out of any property of any
Borrower or any Guarantor, and no Guarantor shall
exercise any right or remedy against any Borrower or
any Guarantor or any property of any Borrower or any
Guarantor by reason of any performance by such
Guarantor of this Guaranty, all of which rights and
remedies are hereby waived by such Guarantor to the
fullest extent permitted by law.
(b) To the extent permitted by law, each Guarantor hereby
expressly waives (i) notice of the acceptance by the
Agent or the Lenders of this Guaranty, (ii) notice of
the existence or creation or non-payment of all or
any of the Guaranteed Liabilities, (iii) presentment,
demand, notice of dishonor, protest, and all other
notices whatsoever, and (iv) all diligence in
collection or protection of or realization upon the
Guaranteed Liabilities or any security for or
guaranty of any of the foregoing.
6. Transfer of Obligations.
Subject to Section 10.11
of the Credit Agreement, the Agent and
the Lenders may, from time to time,
without notice to any Guarantor,
assign or transfer, or cause to be
assigned or transferred, any or all of
the Guaranteed Liabilities or any
interest therein and, notwithstanding
any such assignment or transfer or any
subsequent assignment or transfer
thereof, such Guaranteed Liabilities
shall be and remain Guaranteed
Liabilities for the purposes of this
Guaranty, and each and every immediate
and successive assignee or transferee
of any of the
Guaranteed Liabilities or of any
interest therein shall, to the extent
of the interest of such assignee or
transferee in the Guaranteed
Liabilities, be entitled to the
benefits of this Guaranty to the same
extent as if such assignee or
transferee were the Agent or a Lender.
7. No Conditions to Effectiveness.
No claim or defense by any Person as to the invalidity or
unenforceability of any obligation under the Loan
Documents shall affect or impair the obligations of
the Guarantors under this Guaranty. The obligation
of the Guarantors under this Guaranty shall be
absolute and unconditional irrespective of any
circumstance whatsoever which might constitute a
legal or equitable discharge or defense of any
Guarantor or any Borrower. Each Guarantor hereby
acknowledges that there are no conditions to the
effectiveness of this Guaranty.
8. Warranties.
Each Guarantor hereby warrants and
represents to the Agent and the Lenders that (i) it
now has and will continue to have independent means
of obtaining information concerning the affairs,
financial condition and business of each Borrower,
and the Agent and the Lenders shall not have any duty
or responsibility to provide such Guarantor with any
credit or other information concerning the affairs,
financial condition or business of any Borrower which
may come into such Person's possession; (ii) all
things necessary to make this Guaranty the legal,
valid and binding obligation of such Guarantor,
enforceable in accordance with its terms, have been
done and performed; (iii) the execution, delivery and
performance of this Guaranty by such Guarantor are
within its powers and do not
(a) contravene any law, rule or regulation presently
in effect which affects or binds it or any of its
properties, or
(b) conflict with or result in a breach of any
guaranty or loan or credit agreement or any other
agreement or instrument to which it is a party in
respect of indebtedness for money borrowed, except
for such contraventions, conflicts and breaches that,
in the aggregate, will not have a material adverse
effect on Bairnco and its Subsidiaries on a
consolidated basis; and (iv) any and all information
heretofore or hereafter provided by such Guarantor to
the Agent and the Lenders hereunder and certified by
an Authorized Officer of such Guarantor is and shall
be true and accurate in all respects as of the date
furnished and does not and shall not omit any
material fact necessary to make the information not
misleading.
9. Modification of Guaranty.
This Guaranty shall not
be amended, supplemented or otherwise modified
without the written consent of the Agent and the
Required Lenders and the Guarantors.
10. Notices.
All notices or other communications given
hereunder shall be in writing (including telex and
facsimile communication) and mailed, telexed,
telecopied or delivered:
(a) if to a Guarantor, to it at its address set forth
on the signature pages hereof or at such other address
as shall have been or be designated by it in a
written notice to the Agent;
(b) if to the Agent or any Lender, to such Person at its
address set forth in the Credit Agreement or at such other address
as shall have been or be designated by it in a written
notice to the Guarantors.
All such notices and communications shall be
deemed to have been duly made or given (i) when
delivered by hand, (ii) five (5) Business Days after
being deposited in the mail, postage prepaid, (iii)
when telexed, answer back received, or (iv) when by
facsimile communication, receipt acknowledged.
11. GOVERNING LAW; CONSENT TO JURISDICTION AND
SERVICE OF PROCESS; WAIVER OF JURY TRIAL.
(a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE
STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES. ALL JUDICIAL PROCEEDINGS BROUGHT
AGAINST ANY COMPANY ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY
OBLIGATIONS THEREUNDER, MAY BE BROUGHT IN ANY STATE
OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE
STATE, COUNTY AND CITY OF NEW YORK; PROVIDED,
HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST
ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT
THE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION
WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND.
BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH
BORROWER, FOR ITSELF AND IN CONNECTION WITH ITS
PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH
COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREES THAT SERVICE OF ALL PROCESS IN
ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO IT AT ITS ADDRESS PROVIDED
IN ACCORDANCE WITH THIS SECTION 11;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE
(III) ABOVE IS SUFFICIENT TO CONFER PERSONAL
JURISDICTION OVER ITSELF IN ANY SUCH PROCEEDING
IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT;
(V) AGREES THAT XXXXXXX RETAIN THE RIGHT TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR TO BRING PROCEEDINGS AGAINST COMPANY IN
THE COURTS OF ANY OTHER JURISDICTION; AND
(VI) AGREES THAT THE PROVISIONS OF THIS SECTION
11 RELATING TO JURISDICTION AND VENUE SHALL BE
BINDING AND ENFORCEABLE TO THE FULLEST EXTENT
PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS
LAW SECTION 5-1402 OR OTHERWISE.
(b) EACH GUARANTOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS
IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS GUARANTY OR
ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF THE AGENT, THE
LENDERS, THE GUARANTORS OR THE BORROWERS. EACH
GUARANTOR ACKNOWLEDGES AND AGREES THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR
THIS PROVISION (AND EACH OTHER PROVISION OF EACH
OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR
THE AGENT AND THE LENDERS ENTERING INTO THE
CREDIT AGREEMENT AND EACH SUCH OTHER LOAN
DOCUMENT.
12. Resolution of Drafting Ambiguities.
Each of the parties hereto acknowledge that it was represented by
counsel in connection with the preparation, execution
and delivery of this Guaranty, that its counsel
reviewed the foregoing and participated in the
negotiation thereof and any rule of construction
under any applicable law to the effect that
ambiguities are to be resolved against the drafting
party shall not be employed in the interpretation
of this Guaranty.
13. Additional Guarantors.
The initial Guarantors hereunder shall be Bairnco and such of the
Subsidiaries of Bairnco as are signatories hereto on
the date hereof. From time to time subsequent to the
date hereof, additional Subsidiaries of Bairnco may
become parties hereto, as additional Guarantors (each
an "Additional Guarantor"), by executing a
counterpart of this Guaranty. Upon delivery of any
such counterpart to Agent, notice of which is hereby
waived by Guarantors, each such Additional Guarantor
shall be a Guarantor and shall be as fully a party
hereto as if such Additional Guarantor were an
original signatory hereof. Each Guarantor expressly
agrees that its obligations arising hereunder shall
not be affected or diminished by the addition or
release of any other Guarantor hereunder, nor by any
election of Agent not to cause any Subsidiary of
Bairnco to become an Additional Guarantor hereunder.
This Guaranty shall be fully effective as to any
Guarantor that is or becomes a party hereto
regardless of whether any other Person becomes or
fails to become or ceases to be a Guarantor
hereunder.
14, Reaffirmation and Modification of Original Loan Documents.
It is the intention of each of the parties
hereto that the Existing Guaranty be amended and
restated so as to preserve the perfection and
priority of all security interests securing
indebtedness under the Original Credit Agreement, the
Existing Guaranty and the other Loan Documents (as
defined in the Original Credit Agreement) and that
all indebtedness and obligations of the Borrowers and
the guarantors under the Original Credit Agreement,
the Existing Guaranty and the other Loan Documents
(as defined in the Original Credit Agreement) shall
be secured by the Loan Documents and that this
Agreement shall not constitute a novation of the
obligations and liabilities existing under the
Existing Guaranty. The parties hereto further
acknowledge and agree that this Agreement constitutes
an amendment of the Existing Guaranty made under the
terms thereof.
IN WITNESS WHEREOF, the parties hereto have
caused this Guaranty to be executed by their
respective officers thereunder duly authorized as of
the day and year first above written.
BAIRNCO CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
Name Xxxxx X. Xxxxxxx
Title: VP Finance
Address: 000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxx Xxxx, Xxxxxxx 00000
Fax No.: (000) 000-0000
Telephone: (000) 000-0000
KASCO CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title VP
Address: 000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxx Xxxx, Xxxxxxx 00000
Fax No.: (000) 000-0000
Telephone: (000) 000-0000
XXXXX, INC.
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: VP
Address: 000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxx Xxxx, Xxxxxxx 00000
Fax No.: (000) 000-0000
Telephone: (000) 000-0000
MII INTERNATIONAL, INC.
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: VP
Address: 000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxx Xxxx, Xxxxxxx 00000
Fax No.: (000) 000-0000
Telephone: (000) 000-0000
IN WITNESS WHEREOF, the undersigned Additional
Guarantor has caused this Guaranty to be duly
executed and delivered by its officer thereunto duly
authorized as of ______________, [1999][200_].
_______________________
____________ _____
(Name of Additional
Guarantor)
By:
__________________
________ Name:
Title:
Address:
__________________
________
__________________________
__________________________
Fax No.:
Telephone:
EXHIBIT J
AMENDED AND RESTATED PLEDGE AGREEMENT
THIS AMENDED AND RESTATED PLEDGE AGREEMENT dated as of
February 22, 2000, (hereinafter, as the same may at
any time be amended or modified and in effect,
referred to as this "Agreement"), is by and among
BAIRNCO CORPORATION, a Delaware corporation
(hereinafter called "Bairnco"), XXXXX, INC., a
Delaware corporation (hereinafter called "Xxxxx"),
KASCO CORPORATION, a Delaware corporation
(hereinafter called "Kasco"), MII INTERNATIONAL,
INC., a Delaware corporation ("MII") and each
additional Subsidiary of Bairnco that may become a
party hereto after the date hereof in accordance with
Section 10.3 hereof (together with Bairnco, Xxxxx and
Kasco, sometimes hereinafter collectively called the
"Companies" and individually a "Company") and BANK OF
AMERICA, N.A ("Bank of America"; the successor by
merger to Bank of America Illinois, formerly known as
Continental Bank, N.A.), as Agent (as defined in the
first recital hereto) and amends and restates in its
entirety that certain Pledge Agreement dated as of
September 27, 1990 (as amended, restated,
supplemented or otherwise modified as of the date
hereof, the "Existing Pledge Agreement"), by and
among Bairnco, Xxxxx, Kasco, Shielding Systems
Corporation, a Delaware corporation, other
subsidiaries of Bairnco party thereto and Bank of
America, as agent.
RECITALS
WHEREAS, Bairnco, Xxxxx and Kasco and certain of
Bairnco's other subsidiaries (each of Bairnco, Xxxxx,
Kasco and such other subsidiaries, individually a
"Borrower" and collectively, the "Borrowers") are
parties to that certain Second Amended and Restated
Credit Agreement dated as of February 22, 2000 (as
the same may be amended, restated, supplemented or
otherwise modified from time to time, hereinafter
referred to as the "Credit Agreement"), with the
banks and other financial institutions which are, or
may become, parties thereto (hereinafter collectively
called the "Lenders" and individually called a
"Lender"), SunTrust Bank, as syndication agent and
Bank of America, as agent for the Lenders (in such
capacity, together with any successors thereto in
such capacity, hereinafter referred to as the
"Agent"), pursuant to which the Lenders have agreed
to make credit available to the Companies and certain
of Bairnco's other Subsidiaries;
WHEREAS, certain or all of the Companies have
entered into or may from time to time enter into or
obtain Hedging Obligations (as defined in the Credit
Agreement) with one or more of the Lenders;
WHEREAS, the Companies have executed and
delivered that certain Guaranty dated as of September
27, 1990, as amended, restated, supplemented or
otherwise modified as of the date hereof (as the same
may be further amended, restated, supplemented or
otherwise modified, the "Guaranty"), in favor of
Agent for the benefit of Lenders, pursuant to which
each Company has guarantied the prompt payment and
performance when due of all Obligations of the
Borrowers under the Credit Agreement, including
without limitation the obligation of the Borrowers to
make payments thereunder in the event of early
termination thereof;
WHEREAS, it is in the best interests of each
Company to execute and deliver this Agreement
inasmuch as each Company will derive substantial
direct and indirect benefits from the financial
accommodations to be made under the Credit Agreement
and the Hedging Obligations;
WHEREAS, the Companies wish to secure the
Companies', the Borrowers' and certain other Persons'
obligations with respect to (i) the Credit Agreement,
(ii) the Guaranty, and (iii) the Hedging Obligations,
all with the collateral provided pursuant to this
Agreement;
WHEREAS, each Company described in Schedule I
hereto is the owner of the shares of stock,
partnership interests, limited liability company
interests and other equity interests (collectively,
the "Equity Interests") and promissory notes
described opposite its name in Schedule I hereto and
may from time to time become the owner of additional
Equity Interests, promissory notes or other
securities evidencing an ownership interest in or
debt of another Person;
WHEREAS, it is a condition precedent to the
Lenders amending and restating the Credit Agreement
on the date hereof that the Existing Pledge Agreement
be amended and restated as provided herein to support
the obligations of the Borrowers and the Companies
under the Credit Agreement and the other Loan
Documents;
NOW, THEREFORE, in consideration of the premises
and of the mutual covenants herein contained, and
other good and valuable consideration (receipt of
which is hereby acknowledged), the parties hereto,
intending to be legally bound, agree as follows:
1. Definitions.
(A) When used herein, unless
the context shall otherwise require, the following
terms shall have the following meanings:
Collateral means the Debt Collateral and the Equity
Collateral.
Debt Collateral - see Section 2.2 hereof.
Domestic Subsidiary shall mean Xxxxx, Kasco,
[MII] or any other Subsidiary organized under the
laws of a U.S. jurisdiction.
Equity Collateral - see Section 2.1 hereof.
Foreign Subsidiary means Xxxxxxx & Xxxx GmbH, a
Gesellschaft mit beschraenkter Haftung organized
under the laws of the Federal Republic of Germany,
EuroKasco S.A., a societe anonyme organized under the
laws of France, Atlantic Service Company (U.K.) Ltd.,
an English company, or any other Subsidiary organized
under the laws of a jurisdiction not part of the U.S.
Issuer means the issuer of any of the shares of
stock, promissory notes or other securities
representing all or any of the Collateral.
Permitted Action - see Section 9(b) hereof.
Pledged Notes - see Section 2.2 hereof.
Pledged Equity Interests - see Section 2.1
hereof.
Security Interest shall, when used
with respect to any
Person, mean any interest in any real or personal
property, asset or other right owned or being purchased or
acquired by such Person for its own use, consumption or
enjoyment in its business which secures payment or
performance of any obligation and shall include any
mortgage, lien, pledge, encumbrance, charge or other
security interest of any kind, whether arising under a
security agreement, mortgage, deed of trust, chattel
mortgage, assignment, pledge, financing or similar
statement or notice or as a matter of law, judicial
process or otherwise.
(B) Unless otherwise defined herein, terms defined
in the Credit Agreement shall have the same meaning
used therein notwithstanding any termination thereof.
Terms not otherwise defined herein or in the Credit
Agreement shall have the meaning, if any, ascribed to
them under the Uniform Commercial Code, as it may be
in effect in the State of New York.
2. Grant of Security Interests.
2.1 Equity Collateral. As collateral security for the
prompt and complete payment and performance of all Obligations,
each Company hereby pledges to the Agent and hereby grants
to the Agent a continuing Security Interest in, and hereby
affirms all prior Security Interests granted by it under
the Existing Pledge Agreement in, all of its right, title
and interest in the following, whether now existing or
hereafter arising or acquired (hereinafter collectively
referred to as the "Equity Collateral"):
(A) all of the Equity Interests described in
Schedule I (hereinafter collectively called the "Pledged Equity
Interests"), all of the certificates and/or instruments
representing the Pledged Equity Interests, and all cash,
securities, dividends, distributions, rights to vote or
manage the business of such Person pursuant to
organizational documents governing the rights and
obligations of stockholders, partners, members or other
owners thereof and other rights and other property at any
time and from time to time received, receivable or
otherwise distributed in respect of or in exchange for any
or all of the Pledged Equity Interests;
(B) all additional Equity Interests of any Subsidiary
which such Company acquires at any time and from time to
time in any manner,
all of the certificates representing such additional
Equity Interests, all options to purchase, warrants
and rights with respect to any such additional Equity
Interests, all securities convertible into such
additional Equity Interests and all cash, securities,
dividends, distributions, rights to vote or manage
the business of such Person pursuant to
organizational documents governing the rights and
obligations of stockholders, partners, members or
other owners thereof and other rights and other
property at any time and from time to time received,
receivable or otherwise distributed in respect of or
in exchange for any or all of such additional Equity
Interests; provided, however, that to the extent, and
only to the extent, that the Equity Interests of any
Foreign Subsidiary included in the Collateral shall
exceed 65% of all outstanding Equity Interests of
such Foreign Subsidiary, such excess Equity Interests
shall automatically be deemed released from the
Security Interest created hereby;
(C) all other property hereafter delivered to the
Agent in substitution for or in addition to any of
the foregoing, all certificates, promissory notes and
instruments representing or evidencing any such
property and all cash, securities, interest,
dividends, rights and other property at any time and
from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or
all thereof; and
(D) all proceeds, products, profits and returns of
and from any of the foregoing.
TO HAVE AND TO HOLD the Equity Collateral, together
with all rights, titles, interests, privileges and
preferences appertaining or incidental thereto, unto
the Agent, its successors and assigns, forever,
subject, however, to the terms, covenants and
conditions hereinafter set forth.
2.2 Debt Collateral. As collateral security for
the prompt and complete payment and performance of
all Obligations, each Company hereby pledges to Agent
and hereby grants to the Agent a continuing Security
Interest in, and hereby affirms all the prior
Security Interests granted by it under the Existing
Pledge Agreement in, all of its right, title and
interest in the following, whether now existing or
hereafter arising or acquired (hereinafter
collectively referred to as the "Debt Collateral"):
(A) all of the promissory notes described in
Schedule I and all Intercompany Notes (hereinafter
collectively called the "Pledged Notes"), and all of
the indebtedness evidenced thereby, together with
all cash, securities, rights and other property at
any time and from time to time received, receivable
or otherwise distributed in respect of or in
exchange for any or all of the Pledged Notes;
(B) any and all extensions, renewals, replacements or
substitutions of or for any of the foregoing items;
(C) all other property hereafter delivered to the
Agent in substitution for or in addition to any of
the foregoing, all promissory notes, certificates and
instruments representing or evidencing any such
property and all cash, securities, interests, rights
and other property at any time and from time to time
received, receivable or otherwise distributed in
respect of or in exchange for any or all thereof; and
(D) all proceeds, products, profits and returns of
and from any of the foregoing.
TO HAVE AND TO HOLD the Debt Collateral, together
with all rights, titles, interests, privileges and
preferences appertaining or incidental thereto, unto
the Agent, its successors and assigns, forever,
subject, however, to the terms, covenants and
conditions hereinafter set forth.
3. Warranties and Covenants. Each Company warrants
and covenants to the Agent that:
(A) each Company listed in Schedule I hereto owns
the Equity Interests and promissory notes described
as being owned by it in such schedule, free and clear
of all claims and Security Interests of every
description whatsoever, with full right to deliver,
pledge, assign and transfer such Equity Interests and
promissory notes to the Agent as Collateral
hereunder; and each Company is (or at the time of any
future delivery, pledge, assignment or transfer of
other Collateral will be) the legal and equitable
owner of its other Collateral free and clear of all
claims and Security Interests of every description
whatsoever, with full right to deliver, pledge,
assign and transfer such Collateral to the Agent as
Collateral hereunder;
(B) the Agent has and at all times will have as security
for the prompt and complete payment and performance of the
Obligations, a valid perfected Security Interest in the
Pledged Equity Interests, the Pledged Notes and the other
Collateral, subject only to Permitted Liens;
(C) the certificates representing the Equity
Collateral are and at all times will be duly
authorized, validly issued, fully paid and non-
assessable;
(D) all documentary, stamp or other similar taxes or
fees owing in connection with the issuance, transfer
and/or pledge of the Collateral have been paid in
full, and the Companies will hereafter pay all such
taxes or fees as such become due and payable;
(E) the Equity Collateral includes on the date
hereof, and will continue to include at all times not
less than 100% of each Domestic Subsidiary's and 65%
of each Foreign Subsidiary's total shares (preferred,
common or otherwise) of issued and outstanding
capital stock, partnership interests, or limited
liability company interests, as applicable, and any
and all options to purchase, warrants and rights with
respect to any shares of any such stock, partnership
interests, or limited liability company interests, as
applicable, or any securities convertible into shares
of any such stock, partnership interests, or limited
liability company interests, as applicable;
(F) each of the Pledged Notes has been duly
authorized, executed, endorsed, issued and delivered,
and is the legal, valid, and binding obligation of
the maker thereof, enforceable in accordance with its
terms, and is not in default; and each promissory
note pledged to the Agent in the future pursuant
hereto will be duly authorized, executed, endorsed,
issued and delivered, and will be the legal, valid,
and binding obligation of the maker thereof,
enforceable in accordance with its terms, and will
not be in default;
(G) the information contained in Schedule I hereto
is true and accurate in all respects;
(H) each Company shall deliver to the Agent,
promptly upon receipt and in due form for transfer
(e.g., endorsed in blank or accompanied by stock or
bond powers executed in blank), any Collateral
(including, without limitation, additional
certificated Equity Interests of the type referred to
in Section 2.1(b) and additional notes of the type
referred to in Section 2.2(b) hereof, but excluding
dividends or distributions to such Company permitted
under Section 7 of this Agreement) which may at any
time or from time to time be in or come into the
possession or control of such Company; prior to the
delivery thereof to Agent, such Company shall hold
such Collateral separate and apart from its other
property and in express trust for Agent;
(I) each Company that has granted a security
interest in Equity Interests in a partnership or
limited liability company shall deliver to such
partnership or limited liability company an order,
satisfactory in form and substance to Agent,
requesting that the pledge of such Company's Equity
Interest in such partnership or limited liability
company be registered on the books of such limited
liability company or partnership;
(J) so long as any of the Obligations remain
outstanding, each Company, shall, unless the Agent
shall otherwise consent in writing: (A) at its
expense, promptly deliver to the Agent from time to
time, upon the Agent's request, such stock powers and
other documents with respect to the Collateral (which
documents shall be satisfactory in form and substance
to the Agent) as the Agent may reasonably request to
preserve and protect, and to enable the Agent to
enforce, its rights and remedies hereunder; (B) not
sell, assign, exchange or otherwise transfer any of
its right to any of the Collateral, except as
permitted by Section 7.2.8 of the Credit Agreement;
(C) not create or suffer to exist any claim or
Security Interest or encumbrance against, on or with
respect to any of the Collateral except for the
pledge hereunder and the Security Interest created
hereby; (D) not make or consent to any amendment,
modification or waiver with respect to any of the
Collateral, nor enter into any agreement or permit to
exist any restriction with respect to any of the
Collateral other than pursuant hereto; and (E)
neither take nor fail to take any action which would
in any way materially impair the value or
enforceability of the Agent's Security Interest in
any of the Collateral; provided, however, that the
foregoing clauses (A) through (E) shall not apply to
payments, dividends or distributions to any Company
permitted under Section 7 of this Agreement; and
(K) all other information provided herein is true
and correct in all material respects as of the date
hereof and all information with respect to the
Collateral set forth in any schedule, certificate, or
other writing heretofore or hereafter furnished by
any Company to the Agent hereunder and certified by
an Authorized Officer of such Company is and will be
true and correct in all material respects as of the
date furnished and does not and will not omit any
material fact necessary to make the statements not
misleading.
Each representation and warranty made or to be
made herein by each Company shall be deemed remade as
of and at the date of each Loan made from time to
time under or in connection with the Credit Agreement
and at the date of the issuance of any Letter of
Credit under or in connection with the Credit
Agreement with the same affect as if made
contemporaneously with the making of each such Loan
or the issuance of each such Letter of Credit.
4. Processing, Sale, Collections, etc.
(A) Until notice from the Agent to the contrary, given
at any time after the occurrence and during the
continuance of any Default, each Company:
(i) shall, at its own expense, endeavor to collect,
as and when due, all amounts due with respect to any of
the Collateral,
including the taking of such action with respect to such
collection as the Agent may reasonably request or, in
the absence of such request, as such Company may deem
advisable, and
(ii) may grant, until such time as the Agent shall notify
it of the revocation of such power and authority, in the
ordinary course of business, to any Person obligated on any of the
Debt Collateral, any rebate, refund or allowance to which
such Person may be lawfully entitled, and may accept, in
connection therewith, the return of goods, the sale or
lease of which shall have given rise to such Debt
Collateral.
The Agent, however, may at any time, whether before
or after the maturity of any of the Obligations, so long
as a Default shall have occurred and be continuing, (1)
notify any Person obligated on any of the Collateral to
make payment to the Agent of any amounts due or to become
due thereunder; (2) enforce collection of any of the
Collateral by suit or otherwise;
(3) surrender, release or exchange all or any part of the
Collateral, or compromise or extend or renew for any
period (whether or not longer than the original period)
any indebtedness thereunder or evidenced thereby; (4)
notify any Company (and upon receipt of such notice such
Company agrees to notify, at its sole expense, any
parties obligated on any of the Collateral) to make
payment to Agent of any amount due or to become due under
the Collateral; (5) transfer all or any part of the
Collateral into the name of Agent or its nominee, with or
without disclosing that such Collateral is subject to the
Security Interest hereunder; and (6) take control of any
proceeds of the Collateral.
(B) If and to the extent that a perfected Security
Interest hereunder in any Collateral shall cease to be perfected
for any reason whatsoever (including, without limitation,
release of all or any balance in any account of any
Company or use or disposition by any Company of any
proceeds of Collateral), then such Collateral (referred
to in this paragraph as "released Collateral") shall be
deemed thereby released from the Security
Interest hereunder in exchange, as of the time of
such release, for any other Collateral of equivalent
value in which a perfected Security Interest is being
obtained contemporaneously or has been most recently
obtained hereunder, but only to the extent such other
Collateral does not represent either (x) Collateral
in exchange for which any previously released
Collateral shall have been deemed released, or (y)
Collateral of equivalent value to any loan or
financial accommodation (otherwise than by renewal or
extension) from any Lender or the Agent to any
Company in which Collateral a perfected Security
Interest hereunder shall have been obtained
contemporaneously with or most recently prior to such
loan or advance.
(C) Upon the written request of the Agent, to be given at
the Agent's discretion at any time after the occurrence
and during, the continuance of any Default, each
Company will, forthwith upon receipt, transmit and
deliver to the Agent in the form received, all cash,
checks, drafts and other instruments or writings for
the payment of money (properly endorsed, where
required, so that such items may be collected by the
Agent, but excluding payments, dividends or
distribution; to any Company permitted under Section
7 of this Agreement) which may be received by such
Company at any time in full or partial payment or
other proceeds of any Collateral. Except as the
Agent may otherwise consent in writing, after the
occurrence and during the continuance of a Default,
any such items which may be so received by such
Company will not be commingled by such Company with
any of its other funds or property, but, until
delivery to the Agent, will be held separate and
apart from such other funds and property and in trust
for the Agent.
(D) Once a Default shall have occurred and be
continuing, all items or amounts which are delivered
by any Company to the Agent (or collected directly by
the Agent, as the case may be) on account of partial
or full payment or otherwise as proceeds of any of
the Collateral shall be deposited to the credit of a
deposit account (hereinafter referred to as the
"Restricted Account") of the Companies with the
Agent, as security for performance and payment of the
Obligations. Such Company shall have no right to
withdraw any funds deposited in the Restricted
Account. Once a Default shall have occurred and be
continuing, the Agent may, from time to time, in its
discretion, apply all or any of the then balance in
the Restricted Account toward payment of the
Obligations, in such order of application as the
Agent may determine, and the Agent may (but will not
be required to), from time to, time, in its
discretion, release all or any of such balance
representing collected funds to Bairnco (for
distribution to the Companies according to their
interests) by deposit thereof to the aforementioned
general deposit account.
(E) The Agent is authorized to endorse, in the name
of each Company, any item, howsoever received by the
Agent, representing any Collateral or any payment on
or other proceeds of any of the Collateral.
5. Agreements of the Companies. Each Company shall:
(A) furnish the Agent such information concerning
each Company and the Collateral as the Agent may
from time to time reasonably request.
(B) defend each Company's title to the Collateral
against all Persons and against all Liens, claims and
demands whatsoever.
(C) upon request of the Agent, stamp on its records
concerning the Collateral (and/or enter into its
computer records concerning the Collateral), a
notation, in form satisfactory to the Agent, of the
Security Interest created hereby.
(D) reimburse the Agent for all reasonable expenses,
including reasonable attorneys' fees and legal
expenses, incurred by the
Agent in seeking to collect or enforce any rights
under or with respect to the Collateral, in seeking
to collect the Notes and all other Obligations, and
in enforcing its rights hereunder, together with
interest thereon from the date incurred until
reimbursed by the Companies at a rate per annum equal
to the Alternate Reference Rate plus a margin of
2.5%.
(E) at the Agent's request, after the occurrence and
during the continuance of a Default, transfer all or
any part of the Collateral into the name of the Agent
or its nominee, with or without disclosing that such
Collateral is subject to the Security Interest
hereunder.
(F) not make or consent to any amendment, other
modification or waiver with respect to any of the
Collateral.
(G) not take or fail to take any action which would
in any manner impair (i) any obligation of the Issuer
of any Pledged Equity Interests or the Pledged Notes
or any other obligor with respect to an instrument
constituting Collateral, or (ii) the enforceability
of the Agent's Security Interest in any of the
Collateral.
(H) comply in all material respects with all laws,
rules and regulations relating to, and promptly pay
when due all fees, taxes, assessments and other
charges which may be levied upon or assessed against,
the ownership of the Collateral; provided, however,
that such Company shall not be required to comply
with any such law, rule or regulation, or to pay any
such fee, tax, assessment or other charge, the
validity of which is being contested by such Company
in good faith by appropriate proceedings so long as
forfeiture of any part of the Collateral will not
result from the failure of such Company to comply
with any such law, rule or regulation, or to pay any
such fee, tax, assessment or other charge; during the
period of such contest and such Company maintains
adequate reserves in accordance with GAAP in
connection with such contest.
(I) permit the Agent and designees of the Agent, at
reasonable times, to inspect, audit and make copies
of and extracts from all records and all other papers
which pertain to the Collateral in the possession of
such Company and shall, upon request of the Agent,
deliver to the Agent all of such records and papers
which pertain to the Collateral and all Persons
obligated with respect thereto.
6. Certain Rights of Agent.
(A) The Agent may, from time to time, after the
occurrence and during the continuance of any Default,
without notice to any Company, take all or any of the
following actions: (i) transfer all or any part of
the Collateral into the name of the Agent or any
nominee or agent for the Agent, with or without
disclosing that such Collateral is subject to the
Security Interest hereunder, (ii) appoint one or more
agents or nominees for the purpose of retaining
physical possession of the Collateral, (iii) notify
the parties obligated on any of the Collateral to
make payment to the Agent of any amounts due or to
become due thereunder, (iv) enforce collection of any
of the Collateral by suit or otherwise, and
surrender, release or exchange all or any part
thereof, or compromise or extend or renew for any
period (whether or not longer than the original
period) any obligations of any nature of any party
with respect thereto, (v) endorse any checks, drafts
or other writings in the name of any Company to
enable the Agent to collect the Collateral and (vi)
take control of the Collateral.
(B) The Agent shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral if
it takes such action for that purpose as any Company
shall request in writing, but failure of the Agent to
comply with any such request shall not of itself be
deemed a failure to exercise reasonable
care, and any failure of the Agent to preserve or
protect any rights with respect to the Collateral
against prior parties, or to do any act which any
Company does not so request with respect to
preservation of the Collateral shall not be deemed a
failure to exercise reasonable care in the custody or
preservation of any Collateral.
(C) No delay on the part of the Agent or any Lender
in exercising any right, power or remedy shall
operate as a waiver thereof, nor shall the single or
partial exercise of any such right, power or remedy
preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. No
amendment, modification or waiver of, or any consent
with respect to, any provision of this Agreement
shall in any event be effective unless the same shall
be in writing, and signed and delivered by the party
to be bound thereby, and then such amendment,
modification, waiver or consent shall be effective
only in the specific instance and for the purpose for
which given.
(D) All of each Company's obligations and all of the
Agent's rights, powers and remedies specified herein
are in addition to all other obligations, rights,
powers and remedies required of or possessed by them,
including, without limitation, those provided by
applicable law or in any other written instrument or
agreement relating to any of the Obligations or any
security therefor.
Each Company agrees that, if at any time all or any
part of any payment theretofore applied by the Agent
to any of the Obligations is or must be rescinded or
returned by the Agent for any reason whatsoever
(including, without limitation, the insolvency,
bankruptcy or reorganization of any Company) such
obligations shall, for the purposes of this
Agreement, to the extent that such payment is or must
be rescinded or returned, be deemed to have continued
in existence, notwithstanding such application by the
Agent, and this Agreement shall continue to be
effective or be reinstated, as the case may be, as to
such Obligations all as though the Agent had not made
such application.
(E) After the occurrence and during the continuance
of a Default, the Agent may from time to time,
without notice to any Company, at its option, perform
any material obligation to be performed by any
Company hereunder, under the Credit Agreement or
under the Loan Documents which shall not have been
performed and take any other action which the Agent
deems necessary for the maintenance or preservation
of any of the Collateral or its Security Interest in
the Collateral. All moneys advanced by the Agent in
connection with the foregoing shall, whether or not
there are then outstanding any credit extensions made
under the Credit Agreement or the Credit Agreement is
in effect, bear interest at the Alternate Reference
Rate plus a margin of 2.5% (or such lower maximum
rate as shall be legal under applicable law), and
shall be repaid together with such interest by the
Companies to the Agent, upon the latter's demand, and
shall be secured hereby prior to any other
indebtedness or obligation secured hereby, but the
making of any such advance by the Agent shall not
relieve any Company of any default hereunder or
thereunder.
(F) The powers conferred on the Agent hereunder are
solely to protect its interest (on behalf of the
holders of the Obligations) in the Collateral and
shall not impose any duty on it to exercise any such
powers. Except for the safe custody of any Collateral
in its possession and the accounting for moneys
actually received by it hereunder, the Agent shall
have no duty as to any Collateral or responsibility
for (i) ascertaining or taking action with respect to
calls, conversions, exchanges, maturities, tenders or
other matters relative to any Collateral, whether or
not the Agent has or is deemed to have knowledge of
such matters, or (ii) taking any necessary steps to
preserve
rights against prior parties or any other rights
pertaining to
the Collateral.
7. Voting Rights, Dividends, etc.
(A) Notwithstanding certain provisions of Sections 4
and 6 and hereof, unless and until a Default shall
have occurred and be continuing:
(i) Each Company shall be entitled to exercise
any and all voting or consensual rights and powers
and stock purchase or subscription rights (but any
such exercise by such Company of stock purchase or
subscription rights may be made only from such
Company's funds which do not comprise part of the
Collateral and in compliance with the Credit
Agreement) relating or pertaining to the Collateral
or any part thereof for any purpose; provided,
however, that each Company agrees that it will not
exercise any such right or power in any manner which
would have a material adverse effect on the value of
the Collateral or any part thereof or would approve
or cause a Default under the Credit Agreement.
(ii) Each Company shall be entitled to receive and retain
any and all payments of principal, interest, distributions and
dividends in respect of the Collateral which are paid in
cash. All payments, dividends and distributions in respect
of the Collateral or any part thereof made in promissory
notes, shares of stock, other Equity Interests or other
property other than cash, or representing any non-cash
return of capital, whether resulting from a subdivision,
combination or reclassification of the Collateral or any
part thereof or received in exchange for the Collateral or
any part thereof or as a result of any merger,
consolidation, acquisition or other exchange of assets to
which any Issuer may be a party or otherwise or as a
result of any exercise of any stock purchase or
subscription right, shall become and be part of the
Collateral and shall be Collateral hereunder and, if
received by or on behalf of any Company, shall be
forthwith delivered to the Agent in due form for transfer
(e.g., endorsed in blank or accompanied by stock or bond
powers executed in blank) to be held for the purposes of
this Agreement.
(iii) The Agent shall execute and deliver,
or cause to be executed and delivered, to each Company,
all such proxies, powers of attorney and other instruments
as such Company may request for the purpose of enabling
such Company to exercise the rights and powers which it is
entitled to exercise pursuant to clause (i) or (ii) above.
(B) Upon the occurrence of a Default, and so long as
the same shall be continuing (but only for so long as
the same shall be continuing), all rights and powers
of each Company to receive and retain payments
pursuant to Section 7(a)(ii) hereof shall cease
forthwith upon notice from the Agent to such Company,
and all such rights and powers shall thereupon become
vested in the Agent. During the continuance of a
Default and following the giving of such notice from
the Agent to such company, the Agent shall have the
sole and exclusive authority to exercise such rights
and powers to receive such payments. The Agent shall
retain any and all money and other property paid over
to or received by the Agent pursuant to this
paragraph (b) as additional Collateral hereunder and
shall apply such money or other property in
accordance with the provisions hereof.
8. Remedies.
(A) Whenever a Default shall occur and be
continuing, (i) all obligations may or shall, as the case
may be, become immediately due and payable, as provided in
Section 8.2 or 8.3 of the Credit Agreement, as the case may be, (ii)
the Agent may exercise, from time to time, any rights
or remedies available to it under applicable law or
otherwise available to it, (iii) the Agent shall have
the right, for and in the name, place and
stead of each Company, to execute endorsements,
assignments, stock powers and other instruments of
conveyance or transfer with respect to all or any of
the Collateral and (iv) the Agent may, without demand
or notice of any kind, appropriate and apply any
balances, credits, deposits, accounts or moneys of
each Company which constitute Collateral or proceeds
of Collateral and are with any of the Lenders toward
the payment of such of the Obligations, and in such
order of application, as the Agent, in its sole
discretion, may from time to time elect. Without
limiting the foregoing, upon Default, the Agent may,
to the fullest extent permitted by applicable law,
without notice, advertisement, hearing or process of
law of any kind, (i) sell any or all of the
Collateral at any public or private sale or brokers'
board, free and clear of all rights and claims
therein and thereto of any Company or of any other
Person claiming by, through or under any Company and
(ii) bid for and purchase any or all of the
Collateral at any such sale.
(B) Each Company hereby expressly waives, to the
fullest extent permitted by applicable law, any and
all notices, advertisements, hearings or process of
law in connection with the Agent's exercise of any of
its rights or remedies after Default occurs. If any
notification of intended disposition of any of the
Collateral is required by law, such notification, if
mailed, shall be deemed reasonably and properly given
if mailed at least five (5) days before such
disposition, postage prepaid, and addressed to
Bairnco (for distribution by Bairnco to each Company)
either at the address of Bairnco shown in the Credit
Agreement or at any other address of Bairnco which
appears on the Agent's records. The Agent may apply
any proceeds of any of the Collateral to the payment
of expenses which the Agent incurs in connection with
the enforcement of this Agreement, including, without
limitation, reasonable attorneys' fees and legal
expenses. The Agent may apply any balance of such
proceeds toward the payment of such of the
Obligations, and in such order of application, as the
Agent may, in its sole discretion, elect from time to time.
(C) Each Company agrees that in any sale of any of the
Collateral, the Agent is hereby authorized to comply
with any limitation or restriction in connection with
such sale as the Agent's counsel may advise the Agent
is necessary in order to avoid any violation of
applicable law (including, without limitation,
compliance with such procedures as may restrict the
number of prospective bidders and purchasers and/or
further restrict such prospective bidders or
purchasers to Persons who will represent and agree
that they are purchasing for their own account for
investment and not with a view to the distribution or
resale of such Collateral) or in order to obtain any
required approval by any governmental or regulatory
authority or official of such sale or purchase. Each
Company further agrees that such compliance shall not
result in such sale being considered or deemed not to
have been made in a commercially reasonable manner,
nor shall the Agent be liable or accountable to any
Company for any discount allowed by reason of the
fact that such Collateral shall have been sold in
compliance with any such limitation or restriction.
(D) If sufficient sums are not realized upon any
disposition of the Collateral to pay all Obligations
and any expenses of such disposition, including,
without limitation, attorneys' fees and expenses, the
Companies jointly and severally hereby promise to pay
immediately any resulting deficiency.
(E) No right or remedy herein conferred is intended
to be exclusive of any other right or remedy, but
every such right or remedy shall be cumulative and
shall be in addition to every other right or remedy
herein conferred, or conferred upon the
Agent and the Lenders by any other agreement or
instrument or security, or now or hereafter existing at
law or in equity or by statute.
9. Authority of the Agent and Lenders.
(A) The Agent shall have and be entitled to exercise, all such
powers hereunder as are specifically delegated to the Agent by the terms
hereof, together with such powers as are incidental
thereto. The Agent may execute any of its duties hereunder
by or through agents, or employees and shall be entitled
to retain counsel and to act in reliance upon the advice
of such counsel concerning all matters pertaining to its
duties hereunder. Neither the Agent nor any director,
officer, employee, or agent of the Agent shall be liable
for any action taken or omitted to be taken by it or them
hereunder or in connection herewith, except for its or
their own gross negligence or willful misconduct. Each
Company hereby agrees to reimburse the Agent, on demand,
for all reasonable costs and expenses which the Agent may
incur in connection with the administration or enforcement
of this Agreement (including costs and expenses incurred
by any sub-agent employed by the Agent) and agrees to
indemnify and hold harmless the Agent and any such sub-
agent from and against any and all liability which the
Agent or such sub-agent may incur hereunder or in
connection herewith, unless such liability shall be due to
willful misconduct or gross negligence on the part of the
Agent or such sub-agent.
(B) If at any time, whether before or after any of the
Obligations shall be due and payable, the Agent or any
Lender takes any or all of the Permitted Actions (as
hereinafter defined), then such actions shall not affect
the enforceability of this Agreement, the Credit
Agreement, or any of the other Related Documents or the
Obligations. The Agent or a Lender, as the case may be,
shall have taken a Permitted Action if it shall: (i)
retain or obtain a security interest in any property to
secure any of the Obligations; (ii) retain or obtain the
primary or secondary obligation of any obligor or
obligors, in addition to the Companies', with respect to
any of the Obligations; (iii) extend or renew any of the
Obligations for one or more periods (whether or not longer
than the original period), alter or exchange any of the
Obligations, or release or compromise any obligation of
any nature of any obligor with respect to any of the
Obligations; (iv) release or fail to perfect its Security
Interest in, or impair, surrender, release or permit any
substitution or exchange for, all or any part of any
property securing any of the Obligations or any
obligations hereunder, or extend or renew for one or more
periods (whether or not longer than the original period)
or release, compromise, alter or exchange any obligations
of any nature of any obligor with respect to any such
property; and (v) resort to the Collateral (or any
thereof) for payment of any of the Obligations when due,
whether or not Agent or the Lenders shall have resorted to
any property securing any of the Obligations or shall have
proceeded against any Company or against any other obligor
primarily or secondarily obligated with respect to any of
the Obligations (all of the actions referred to in this
clause (v) being hereby expressly waived by each Company).
(C) The Agent, in its sole discretion, may apply any amounts
which it receives from whatever source on account of the
Obligations toward the payment of the
Obligations in such order of application as the
Agent, in its sole discretion, may from time to
time elect, subject to the terms and provisions
of the Credit Agreement. Notwithstanding any
payments made by or for any Company's account
pursuant to this Agreement, no Company shall be
subrogated to any rights of the Agent until such
time as the Commitments and the Letters of
Credit shall have expired or
terminated and the Agent and the Lenders shall
have received final payment and full performance
of all obligations.
(D) No release from the Security Interest created by
this Agreement of any part of the Collateral by the
Agent shall in any way alter, vary or diminish the
force or effect of any Security Interest created by
this Agreement against the balance or remainder of
the Collateral.
(E) The Agent and any of the officers, employees,
agents or auditors of the Agent shall have the right
at reasonable intervals after the date hereof to make
reasonable inquiries by mail, telephone, telegraph or
otherwise to any Person with respect to the validity
and amount or any other matter (including, without
limitation, the assertion by any Person of claims or
offsets and counterclaims) concerning any of the
Collateral.
10. General.
10.1 Companies Waive Certain Rights; Subrogation.
(A) Each Company hereby expressly waives: (i) notice
of the Agent's acceptance of this Agreement, (ii)
notice of the existence or creation or nonpayment of
all or any of the Obligations, (iii) to the fullest
extent permitted by law, presentment, demand, notice
of dishonor, protest, and all other notices
whatsoever, and (iv) all diligence in collection or
protection of or realization upon the Obligations or
any part thereof, any obligation hereunder or any
security for or guaranty of any of the foregoing.
(B) Each Company hereby irrevocably waives
any claim or other rights which it may now or
hereafter acquire against any other
Company or any Obligor that arise from the existence,
payment, performance or enforcement of any Company's
or Obligor's obligation under this Agreement or any
other Loan Document, including any right of
subrogation, reimbursement, exoneration, or
indemnification, any right to participate in any
claim or remedy of the Lenders against any Company or
Obligor or any collateral which the Agent now has or
hereafter acquires, whether or not such claim, remedy
or right arises in equity, or under contract, statute
or common law, including the right to take or receive
from any Company or any Obligor, directly or
indirectly, in cash or other property or by set-off
or in any manner, payment or security on account of
such claim or other rights. If any amount shall be
paid to any Company in violation of the preceding
sentence and the Obligations shall not have been paid
in cash in full and the Commitments have not been
terminated, such amount shall be deemed to have been
paid to such Company for the benefit of, and held in
trust for, the Lenders, and shall forthwith be paid
to the Lenders to be credited and applied to the
Obligations, whether matured or unmatured.
10.2 Authorization of Additional Obligations. The
creation or existence from time to time of additional
Obligations is hereby authorized, without notice to
any Company, and shall in no way affect or impair the
Agent's rights and each Company's obligations under
this Agreement or any other Loan Document.
10.3 Additional Companies. From time to time
subsequent to the date hereof, additional
Subsidiaries of Bairnco may become parties hereto as
additional Companies (each an "Additional Company"),
by executing a Counterpart substantially in the form
of Exhibit I annexed hereto. Upon delivery of any
such Counterpart to Agent, notice of which is hereby
waived by Companies, each such Additional Company
shall be a Company and shall be as fully a party
hereto as if such Company were an original signatory
hereto. Each Company expressly agrees that its
obligations arising hereunder shall not be affected or
diminished by the addition or release of any other
Company hereunder, nor by any election of Agent not
to cause any Subsidiary of Bairnco to become an
Additional Company hereunder. This Agreement shall be
fully effective as to any Company that is or becomes
a party hereto regardless of whether any other Person
becomes or fails to become or ceases to be a Company
hereunder.
10.4 Assignment of Obligations. The Agent
or any Lender may, from time to time, whether before
or after any of the obligations shall be due, in its
sole discretion and without notice to any Company
(but subject to the terms and provisions of the
Credit Agreement), assign or transfer any or all of
its interest in the Obligations; and, notwithstanding
any such assignment or transfer or any subsequent
assignment or transfer thereof, such Obligations
shall be and remain Obligations for purposes of this
Agreement, and each and every immediate and
successive assignee or transferee of any of the
Obligations or of any interest therein shall, to the
extent of such assignee's or transferee's interest in
the Obligations, be entitled to the benefits of this
Agreement to the same extent as if such assignee or
transferee were the Agent or such Lender (as the case
may be).
10.5 Notices. Notices shall be given in the manner
provided for in, and shall be subject to the terms
of, Section 10.2 of the Credit Agreement.
10.6 Captions. Section captions used in this
Agreement are for convenience of reference only, and
shall not affect the construction of this Agreement.
10.7 Counterpart. This Agreement may be executed in
any number of counterparts and by the different
parties on separate counterparts and each such
counterpart shall be deemed to be an original, but
all such counterparts shall together constitute but
one and the same Agreement.
10.8 Continuing Agreement; Reassignment. This
Agreement shall in all respects be a continuing
Agreement and shall remain in full force and effect
until expiration or termination of the Commitments
and the Letters of Credit and final payment and
performance in full of all Obligations. Upon the
expiration or termination of the Commitments and the
Letters of Credit, the Agent, upon the Companies
request and at the Companies' expense, shall reassign
and redeliver (or cause to be reassigned and
redelivered) to the Companies, or to such Person or
Persons as any Company shall designate, such of the
Collateral, (if any), as the Agent shall not have
sold or otherwise applied pursuant to the terms
hereof and shall still be holding hereunder, together
with appropriate instruments of reassignment and
release. Any such reassignment shall be without
recourse upon or representation or warranty by the
Agent except a warranty that the Agent has not
encumbered or otherwise reassigned such Collateral,
and shall be at the Companies' sole cost and expense.
10.9 Governing Law. THIS AGREEMENT AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES. WHEREVER
POSSIBLE, EACH PROVISION OF THIS AGREEMENT SHALL BE
INTERPRETED IN SUCH MANNER AS TO BE EFFECTIVE AND
VALID UNDER APPLICABLE LAW, BUT IF ANY PROVISION OF
THIS AGREEMENT SHALL BE PROHIBITED BY OR INVALID
UNDER SUCH LAW, SUCH PROVISION SHALL BE INEFFECTIVE
ONLY TO THE EXTENT OF SUCH PROHIBITION OR INVALIDITY,
WITHOUT INVALIDATING THE REMAINDER OF SUCH PROVISION
OR THE REMAINING PROVISIONS OF THIS AGREEMENT.
Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be
effective and valid under applicable law, but if any
provision of this Agreement shall be prohibited by of
invalid under such law, such provision shall be
ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of
such provision or the remaining provisions of the
Agreement.
10.10 Consent to Jurisdiction and Service of Process.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY COMPANY
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS THEREUNDER,
MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY
OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY
MAY BE BROUGHT, AT THE AGENT'S OPTION, IN THE COURTS
OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER
PROPERTY MAY BE FOUND. BY EXECUTING AND DELIVERING
THIS AGREEMENT, EACH BORROWER, FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH
COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREES THAT SERVICE OF ALL PROCESS IN
ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO IT AT ITS ADDRESS PROVIDED
IN ACCORDANCE WITH SECTION 10.4;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE
(III) ABOVE IS SUFFICIENT TO CONFER PERSONAL
JURISDICTION OVER ITSELF IN ANY SUCH PROCEEDING
IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT;
(V) AGREES THAT XXXXXXX RETAIN THE RIGHT TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR TO BRING PROCEEDINGS AGAINST COMPANY IN
THE COURTS OF ANY OTHER JURISDICTION; AND
(VI) AGREES THAT THE PROVISIONS OF THIS SECTION
10.9 RELATING TO JURISDICTION AND VENUE SHALL BE
BINDING AND ENFORCEABLE TO THE FULLEST EXTENT
PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS
LAW SECTION 5-1402 OR OTHERWISE.
10.11 Waiver of Jury Trial.
THE AGENT, THE LENDERS AND THE
BORROWERS HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION
WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DELAING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE AGENT,
THE LENDERS OR THE BORROWERS. EACH BORROWER
ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH
OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH
IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE AGENT AND THE LENDERS ENTERING
INTO THIS AGREEMENT AND EACH SUCH OTHER LOAN
DOCUMENT.
10.12 Successors and Assigns. This Agreement
shall be binding upon each Company and the Agent and their
respective successors and assigns, and shall inure to
the benefit of each Company and the Agent and their
respective successors and assigns.
10.13 Entire Agreement.
Subject to Section 10.17, this
Agreement and related documents as specifically
described supersede any prior agreement or
understanding of the parties hereto, and constitute
the entire agreement of the parties hereto, with
respect to the matters covered hereby.
10.14 Joint and Several Obligations; Security
Interest Absolute.
(A) All obligations of the Companies
hereunder are joint and several obligations and
failure by one Company to perform its obligations
under or relating to this Agreement shall
not relieve any other Company of any obligation under or
relating to this Agreement, the Credit Agreement or any other Loan
Document.
(B) All rights of the Agent and the Security
Interest granted to the Agent hereunder, and all
obligations of the Companies hereunder, shall be
absolute and unconditional, irrespective of (i) any
lack of validity or enforceability of the Credit
Agreement, the Notes, the Letters of Credit or any
other Loan Document or any instrument relating
thereto, or (ii) any other circumstance which might
otherwise constitute a defense available to, or a
discharge of, a guarantor or a third party grantor of
a security interest.
10.15 Agent as Attorney In Fact. Each Company hereby
appoints Agent, with full power of substitution, as
such Company's attorney in fact for the purpose of
carrying out the provisions of this Agreement and
taking any action and executing any instrument which
Agent may deem necessary or advisable to accomplish
the purposes hereof, which appointment is irrevocable
and coupled with an interest.
10.16 No Conditions to Effectiveness. Each
Company hereby acknowledges that there are no
conditions to the effectiveness of this Agreement.
10.17 The Companies to Remain Liable. Each of the
Companies hereby expressly agrees that, anything
herein to the contrary notwithstanding, it shall
remain liable under any contract, agreement, interest
or obligation assigned to the Agent hereunder to
observe and perform all of the conditions and
obligations to be observed and performed by such
Company thereunder, all in accordance with and
pursuant to the terms and provisions thereof. The
exercise by the Agent of any of the rights assigned
hereunder shall not release the Companies from any of
their duties or obligations under any such contract,
agreement, interest or obligation. The Agent shall
not have any duty, responsibility, obligation or
liability under any such contract, agreement,
interest or obligation by reason of or arising out of
the assignment thereof to the Agent or the granting
to the Agent of a Security Interest therein or the
receipt by the Agent of any payment relating to any
such contract, agreement, interest or obligation
pursuant hereto, nor shall the Agent be required or
obligated in any manner to perform or fulfill any of
the obligations of the Companies thereunder or
pursuant thereto, or to make any payment, or to make
any inquiry as to the nature or sufficiency of any
payment received by it or the sufficiency of any
performance of any party under any such contract,
agreement, interest or obligation, or to present or
file any claim, or to take any action to collect or
enforce any performance or the payment of any amounts
which may have been assigned to it, in which it may
have been granted a Security Interest or to which it
may be entitled at any time or times.
10.18 Reaffirmation and Modification of Original
Loan Documents. It is the intention of each of the
parties hereto that the Existing Pledge Agreement be
amended and restated to confirm and continue the
security interests granted thereby and so as to
preserve the perfection and priority of all security
interests securing indebtedness under the Original
Credit Agreement and the other Loan Documents (as
defined in the Original Credit Agreement) and that
all indebtedness and obligations of the Borrowers and
the guarantors under the Original Credit Agreement
and the other Loan Documents (as defined in the
Original Credit Agreement) shall be secured by this
Agreement and the other Loan Documents and that this
Agreement shall not constitute a novation of the
obligations and liabilities existing under the
Existing Pledge Agreement. The parties hereto
further acknowledge and agree that this Agreement
constitutes an amendment of the Existing Pledge
Agreement made under the terms thereof.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be executed as of the above date.
BAIRNCO CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: VP Finance
XXXXX, INC.
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: VP
KASCO CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: VP
MII INTERNATIONAL, INC.
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: VP
BANK OF AMERICA,
N.A., as Agent
By:
Name:
Title:
EXHIBIT I TO PLEDGE AGREEMENT
[FORM OF COUNTERPART]
COUNTERPART (this "Counterpart"), dated
_______, is delivered pursuant to Section 10.3
of the Pledge Agreement
referred to below. The undersigned hereby agrees
that this Counterpart may be attached to the
Amended and Restated Pledge Agreement, dated as of
February 22, 2000 (as it may be from time to time
amended, modified or supplemented, the "Pledge
Agreement"; capitalized terms used herein not
otherwise defined herein shall have the meanings
ascribed therein), among Bairnco Corporation, a
Delaware corporation, the other Companies named
therein, and Bank of America, N.A., as Agent. The
undersigned by executing and delivering this
Counterpart hereby becomes a Company under the
Pledge Agreement in accordance with Section 10.3
thereof and agrees to be bound by all of the terms
thereof.
[Without limiting the generality of the
foregoing, the
undersigned hereby:
(i) authorizes the Agent to add the
information set forth on the Schedules
to this Agreement to the correlative
Schedules attached to the Security
Agreement ;
(ii) agrees that all Collateral of the
undersigned,
including the items of property
described on the Schedules hereto, shall
become part of the Collateral and shall
secure all Obligations; and
(iii) makes the representations and
warranties set forth in the Pledge
Agreement, as amended hereby, to the
extent relating to the undersigned.]
[NAME OF ADDITIONAL COMPANY]
By:
_______________________
____
Name:
Title:
EXHIBIT K
AMENDED AND RESTATED SECURITY AGREEMENT
dated as of February 22, 2000 by and among
BAIRNCO CORPORATION,
KASCO CORPORATION,
XXXXX, INC.,
MII INTERNATIONAL, INC.
Other U.S.
Subsidiaries
of Bairnco Corporation
and
BANK OF AMERICA, N.A.,
as Agent
AMENDED AND RESTATED SECURITY AGREEMENT
THIS AMENDED AND RESTATED SECURITY AGREEMENT dated as
of February 22, 2000 (hereinafter, as the same may
at any time be amended or modified and in effect,
referred to as this "Agreement") is entered into by
and among BAIRNCO CORPORATION, a Delaware corporation
("Bairnco"), XXXXX, INC., a Delaware corporation
("Xxxxx"), KASCO CORPORATION, a Delaware corporation
("Kasco"), MII International, Inc., a Delaware
corporation ("MII") and the other Subsidiaries of
Bairnco that may become a party hereto in accordance
with Section 16(q) hereof (together with Bairnco,
Xxxxx and Kasco are hereinafter sometimes
collectively referred to as the "Companies" and
individually as a "Company"), and BANK OF AMERICA,
N.A., ("Bank of America"; the successor by merger to
Bank of America Illinois, formerly known as
Continental Bank, N.A.), as Agent (as defined in the
first recital hereto) and amends and restates in its
entirety that certain Security Agreement dated as of
September 27, 1990 (as amended, restated,
supplemented or otherwise modified as of the date
hereof, the "Existing Security Agreement"), by and
among Bairnco, Xxxxx, Kasco, Shielding Systems
Corporation, a Delaware corporation, other
subsidiaries of Bairnco party thereto and Bank of
America, as agent.
RECITALS
WHEREAS, Bairnco, Xxxxx and Kasco and certain of
Bairnco's subsidiaries (each of Bairnco, Xxxxx, Kasco
and such other subsidiaries, individually a
"Borrower" and collectively, the "Borrowers") are
party to that certain Second Amended and Restated
Credit Agreement dated as of February ___, 2000 (as
the same may be amended, restated, supplemented or
otherwise modified from time to time, hereinafter
referred to as the "Credit Agreement") with the banks
and other financial institutions which are, or may
become, parties thereto (hereinafter collectively
called the "Lenders" and individually called a
"Lender"), Sun Trust Bank, as syndication agent, and
Bank of America, N.A., as agent for the Lenders (in
such capacity, together with any successors thereto
in such capacity, hereinafter referred to as the
"Agent"), pursuant to which the Lenders have agreed
to make credit available to the Companies and certain
of Xxxxxxx's other Subsidiaries;
WHEREAS, certain or all of the Companies have entered
into or may from time to time enter into or obtain
Hedging Obligations (as defined in the Credit
Agreement) with one or more of the Lenders; WHEREAS,
the Companies have executed and delivered that
certain Guaranty dated as of September 27, 1990, as
amended, restated, supplemented or otherwise modified
as of the date hereof, (as the same may be further
amended, restated, supplemented or otherwise
modified, the "Guaranty") in favor of Agent for the
benefit of Lenders, pursuant to which each Company
has guarantied the prompt payment and performance
when due of all Obligations of the Borrowers under
the Credit Agreement, including without limitation
the obligation of the Borrowers to make payments
thereunder in the event of early termination thereof;
WHEREAS, it is in the best interests of each Company
to execute and deliver this Agreement inasmuch as
each Company will derive substantial direct and
indirect benefits from the financial accommodations
to be made under the Credit Agreement and the Hedging
Obligations;
WHEREAS, the Companies wish to secure the Companies',
the Borrowers' and certain other Persons' obligations
with respect to (i) the Credit Agreement, (ii) the
Guaranty, and (iii) the Hedging Obligations, all with
the collateral provided pursuant to this Agreement;
WHEREAS, it is a condition precedent to the Lenders
amending and restating the Credit Agreement on the
date hereof that the Existing Security Agreement be
amended and restated as provided herein to support
the obligations of the Borrowers and the Companies
under the Credit Agreement and the other Loan
Documents;
NOW, THEREFORE, in consideration of the premises and
of the mutual covenants herein contained, and other
good and valuable consideration (the receipt and
sufficiency of which are hereby
acknowledged), the parties hereto, intending to be
legally bound, agree as follows:
1. Definitions.
(a) When used herein, unless the
context shall otherwise require, the following terms,
shall have the following meanings:
"Account" shall mean (i) any account receivable,
and (ii) any other amount payable to a Company for any reason
whatsoever. "Benefits" shall have the meaning
assigned to such term in Section 17 hereof.
"Certificated Security" shall have the meaning
assigned to such term in the Uniform Commercial Code.
"Chattel Paper" shall have the meaning assigned
to such term in the Uniform Commercial Code.
"Computer Hardware and Software" shall mean (i)
all computer and other electronic data processing
hardware, integrated computer systems, central
processing units, memory units, display terminals,
printers, features, computer elements, card readers,
tape drives, hard and soft disk drives, cables,
electrical supply hardware, generators, power
equalizers, accessories and all peripheral devices
and other related computer hardware, whether now
owned, licensed or leased or hereafter acquired by
any Company; (ii) all software programs, whether now
owned, licensed or leased or hereafter acquired by
any Company, designed for use on the computers and
electronic data processing hardware described in
clause (i) above, including, without limitation,
operating system software, utilities and application
programs in whatever form (source code and object
code in magnetic tape, disk or hard copy format or
any other listings whatsoever); (iii) all firmware
associated therewith, whether now owned, licensed or
leased or hereafter acquired by any Company; and (iv)
all documentation for such hardware, software and
firmware described in the preceding clauses (i), (ii)
and (iii), whether now owned, licensed or leased or
hereafter acquired by any Company, including, without
limitation, flow charts, logic diagrams, manuals,
specifications, training materials, charts and pseudo
codes.
"Default Rate" shall mean the Alternate Reference
Rate plus a margin of 2.5%.
"Document" shall have the meaning assigned to such
term in the Uniform Commercial Code.
"Equipment" shall mean all furniture,
furnishings, fixtures, machinery and equipment of any
of the Companies of every description used or useful
in the conduct of such Company's business, and all
accessories, accessions, additions, attachments,
substitutions, replacements, improvements, parts and
other property now or hereafter affixed thereto or
used in connection therewith.
"Fixture" shall have the meaning assigned to such
term in the Uniform Commercial Code.
"General Intangibles" shall have the meaning assigned
to such term in the Uniform Commercial Code.
"Goods" shall have the meaning assigned to such term
in the Uniform Commercial Code.
"Instrument" shall have the meaning assigned to
such term in the Uniform Commercial Code.
"Intangible Collateral" shall mean all Collateral
other than Inventory, Equipment, Fixtures and the
Collateral described in clause (i) of the definition
of Computer Hardware and Software.
"Inventory" shall mean goods, merchandise and
other personal property furnished or to be furnished under any
contract of service or intended for sale or lease,
including, without limitation, all raw materials,
work in process, finished goods, materials and
supplies, of any kind, nature or description, that
are used or consumed by any Company's business, or
are or might be used in connection with the
manufacture, packing, shipping, advertising, selling
or finishing of such goods, merchandise and other
personal property, and all returned or repossessed
goods now or at any time or times hereafter in the
possession or under the control of any Company or the
Agent.
"Patents" shall have the meaning assigned to such
term in Section 2 hereof.
"Person" shall mean any natural person,
corporation, firm, association, government,
governmental agency or any other entity, whether
acting in an individual, fiduciary or other capacity.
"Restricted Account" shall have the meaning
assigned to such term in Section 5(d) hereof.
"Security" shall have the meaning assigned to such
term in the Uniform Commercial Code.
"Security Interest" shall, when used with
respect to any Person, mean any interest in any real
or personal property, asset or other right owned or
being purchased or acquired by such Person for its
own use, consumption or enjoyment in its business
which secures payment or performance of any
obligation and shall include any mortgage, lien,
pledge, encumbrance, charge or other security
interest of any kind, whether arising under a
security agreement, mortgage, deed of trust, chattel
mortgage, assignment, pledge, financing or similar
statement or notice or as a matter of law, judicial
process or otherwise.
"Significant Patents and Trademarks" shall mean
any group of Patents and Trademarks having an aggregate fair
market value of $5,000,000 or more, or any
individual Patent or Trademark having a fair market
value of $500,000 or more.
"Trademarks" shall have the meaning assigned to such
term in Section 2 hereof.
"Uncertificated Security" shall have the meaning
assigned to such term in the Uniform Commercial Code.
"Uniform Commercial Code" shall mean the
Uniform Commercial Code as in effect in the State of
New York on the date of this Agreement.
(b) Unless otherwise defined herein, terms defined
in the Credit Agreement shall have the same meaning
when used herein notwithstanding any termination
thereof. Terms not otherwise defined herein or in
the Credit Agreement shall have the meanings, if
any, ascribed to them under the Uniform Commercial
Code, as it may be in effect in the State of New York.
2. Grant of Security Interest.
(a) As collateral security for the prompt and complete
payment and performance of all
Obligations, each Company hereby
mortgages, pledges and collaterally
assigns to the Agent, and grants to the
Agent a continuing Security Interest in,
and hereby affirms all prior mortgages,
pledges, collateral assignments and
grants made by it under the Existing
Security Agreement in, all property of
such Company wherever located, whether
now or hereafter existing, owned,
licensed, leased, consigned, arising or
acquired, including, without limitation,
all of such Company's:
(i) Accounts;
(ii) Goods (including, without limitation, all of such Company's
Equipment, Fixtures and Inventory);
(iii) General Intangibles, including, without limitation,
(a) All tax refunds (except such tax refunds
attributable to Xxxxx Corporation pursuant to the
Tax Sharing and Disaffiliation Agreement between
Bairnco and Xxxxx Corporation),
(b) All foreign, United States and state trademarks
and trademark registrations, tradenames and tradename
registrations and service marks and service mark
registrations now or hereafter owned by such Company,
including, without limitation, those listed on
Schedule I hereto, and all of the goodwill of the
business connected with the use of, and symbolized
by, each trademark and trademark registration,
tradename and tradename registration, service mark
and service mark registration and all continuations
and extensions thereof, the right to sue for past,
present, and future infringements or dilutions
thereof or for injury to the goodwill associated
therewith, all rights corresponding thereto
throughout the world, and all proceeds of the
foregoing (including, without limitation, licenses,
royalties and proceeds of suit) (all of the foregoing
being collectively hereinafter referred to as the
"Trademarks"),
(c) All foreign and United States patents and
applications for patents, including, without
limitation, those listed on Schedule II hereto, and
any and all, and all applications for, reissues,
divisions, continuations, renewals, extensions and
continuations-in-part thereof, the right to sue for
past, present and future infringements thereof, all
rights corresponding thereto throughout the world,
and all proceeds of the foregoing (including, without
limitation, license royalties and proceeds of
infringement suits) (all of the foregoing being
collectively hereinafter referred to as the
"Patents"),
(d) Rights arising from time to time to receive
payment under a billing to a Person representing such
Xxxxxx's obligation to reimburse such Company for
indebtedness paid or to be paid by such Company for
such Person's account, and
(e) Rights arising out of leases, licenses and
contracts which are not Accounts;
(iv) Chattel Paper, Documents, Instruments, Certificated
Securities and Uncertificated Securities (other than
the Pledged Notes and Pledged Shares pledged under
the Pledge Agreement and any other shares of stock
of Subsidiaries organized under the laws of
jurisdictions outside the United States);
(v) Money and property now or at any time in the possession or
under the control of, or in transit to, the Agent,
any Lender, any Company or any bailee, agent or
custodian of the Agent, any Lender, or any Company;
(vi) Right, title and interest (if any) in and to the
accounts of such Company, all funds on deposit
therein, all investments arising out of such funds,
all claims thereunder or in connection therewith, and
all cash, securities, rights and other property at
any time and from time to time received, receivable
or otherwise distributed in respect of such accounts,
such funds or such investments;
(vii) Computer Hardware and Software and all rights
with respect thereto, including, without limitation,
any and all licenses, options, warranties, service
contracts, program services, test rights, maintenance
rights, support rights, improvement rights, renewal
rights and indemnifications and any substitutions,
replacements, additions or model conversions of any
of the foregoing;
(viii) Insurance policies, including claims or rights
to payment thereunder; and
(ix) Liens, guaranties and other rights and
privileges pertaining to any of the Collateral;
together with: (x) all books, ledgers, books of
account, records, writings, data bases, information
and other property relating to, used or useful in
connection with, evidencing, embodying, incorporating
or referring to, any of the foregoing; and (y) all
proceeds, products, rents, issues, profits and
returns of and from any of the foregoing.
TO HAVE AND TO HOLD the Collateral, together with all
rights, titles, interests, privileges and preferences
appertaining or incidental thereto, unto the Agent,
its successors and assigns, forever, subject,
however, to the terms, covenants and conditions
hereinafter set forth.
(b) The amount of Obligations secured by the
Collateral of any Company hereunder shall not exceed
the maximum amount of such liability that can be
hereby incurred without rendering this Agreement, as
it relates to such Company, voidable under
applicable law relating to fraudulent conveyance or
fraudulent transfer, and not for any greater amount.
For purposes of determining such liability of such
Company, due consideration shall be given to the
amount of the credit received, directly or
indirectly, by such Company and its Subsidiaries
(whether or not borrowed by or extended directly to
such Company) and the benefits to each Company of
maintaining an integrated cash management system for
Bairnco and its Subsidiaries.
(c) In addition to, and not by way of limitation of, the grant
of Security Interests in Trademarks and Patents set
forth above, each Company hereby, effective upon the
occurrence of a Default and upon the written demand
of the Agent, assigns, grants, sells, conveys,
transfers title to and sets over to the Agent for the
benefit of the Lenders all of such Company's right,
title and interest, whether now or hereafter existing
or acquired, in and to the Trademarks and Patents, it
being understood that the Agent upon the
effectiveness of such assignment may in its
discretion grant a limited license to such Company
with respect to all or any of the Trademarks and
Patents.
3. The Companies to Remain Liable.
Each of the Companies hereby expressly agrees that, anything
herein to the contrary notwithstanding, it shall
remain liable under each contract, agreement,
interest or obligation collaterally assigned to the
Agent hereunder to observe and perform all of the
conditions and obligations to be observed and
performed by the Companies thereunder, all in
accordance with and pursuant to the terms and
provisions thereof. The exercise by the Agent of any
of the rights assigned hereunder shall not release
the Companies from any of their duties or obligations
under any such contract, agreement, interest or
obligation. The Agent shall not have any duty,
responsibility, obligation or liability under any
such contract, agreement, interest or obligation by
reason of or arising out of the assignment thereof to
the Agent or the granting to the Agent of a Security
Interest therein or the receipt by the Agent of any
payment relating to any such contract, agreement,
interest or obligation pursuant hereto, nor shall the
Agent be required or obligated in any manner to
perform or fulfill any of the obligations of the
Companies thereunder or pursuant thereto, or to make
any payment, or to make any inquiry as to the nature
or sufficiency of any payment received by it or the
sufficiency of any performance of any party under any
such contract, agreement, interest or obligation, or
to present or file any claim, or to take any action
to collect or enforce any performance or the payment
of any amounts which may have been assigned to it, in
which it may have been granted a Security Interest or
to which it may be entitled at any time or times.
4. Representations and Warranties.
Each Company warrants and covenants to the Agent that:
(a) no Uniform Commercial Code financing statement
(other than any which may have been filed on behalf
of the Agent) covering any of the Collateral is on
file in any public office except as permitted under
Section 7.2.2 of the Credit Agreement;
(b) each Company has and will continue to have a valid
leasehold interest in all Collateral it leases and good and
marketable title (subject to any defect in title
asserted by Xxxxx Creditors Trust in certain patents
of Bairnco and Xxxxx and the real property located at
0000 Xxxxxxxx Xxx Xxxxxxxxx, Xxxx, Xxxxxxxx in the
"Properties Lawsuit" as defined and described in
Bairnco's Annual Report on Form 10-k for the year
ended December 31, 1998) to all its other Collateral,
real and personal, of any nature whatsoever (which,
with respect to any licenses, means that such Company
is the lawful owner of its rights under such
licenses) free of all Security Interests whatsoever,
other than the Security Interest created hereby and
except as permitted under Section 7.2.2 of the Credit
Agreement, with full power and authority to execute
this Agreement, to perform such Company's obligations
hereunder, and to subject the Collateral to the
assignment and Security Interest created hereby;
(c) all of each Company's books and records are now
located at one or more of the premises shown for such
Company on Schedule III hereto, and all of each
Company's Equipment and Inventory is located either
at one or more of the premises shown for such Company
on Schedule III hereto or at one or more of the
premises shown for such Company on Schedule IV hereto
except for no more than $12,000,000 of Equipment and
Inventory that is in transit and $2,000,000 of
Equipment and Inventory located at third party
warehouses leased by Kasco territory managers;
(d) all information with respect to the Collateral
and the Persons obligated on the Accounts set forth
in any schedule, certificate, or other writing at any
time heretofore or hereafter furnished by any Company
to the Agent hereunder and certified by an Authorized
Officer of such Company is and will be true and
correct in all material respects as of the date
furnished and does not and will not omit any material
fact necessary to make the statements not misleading;
(e) each Company will at all times maintain its
chief executive office as identified in Schedule III
hereto unless the Agent shall otherwise consent in
writing; provided, however, that so long as no
Default shall have occurred and be continuing, each
Company may move its chief executive office to some
other location within the United States upon (30)
days' advance written notice to the Agent, and, in
furtherance of the foregoing, each Company shall: (i)
manage the main part of such Company's business
operations from such Company's chief executive office
or at its other locations listed in Schedule III;
(ii) maintain all credit information in which an
investor, creditor or other Person having business
relations with such Company would reasonably have an
interest at its chief executive office or at its
other locations listed in Schedule III; (iii) prepare
Federal and State tax returns and all financial
statements and reports at such chief executive office
or at its other locations listed in Schedule III;
(iv) designate such chief executive office as such on
all tax returns, financial statements and reports,
reports to credit bureaus and rating agencies and
other similar returns, statements and reports; (v)
maintain its bookkeeping and accounting departments
at its chief executive office or at its other
locations listed in Schedule III; (vi) cause its
President, chief operating officer, treasurer and
other senior day-to-day supervisory management to
maintain their offices at the chief executive office
or at its other locations listed in Schedule III;
(vii) maintain its corporate minute books and records
(including stock transfer records) at its chief
executive office; and (viii) take such other action
from time to time as is required so that a creditor
of such Company would reasonably expect the chief
executive office identified on Schedule III to be its
chief executive office for purposes of Article 9 of
the Uniform Commercial Code;
(f) with respect to those Patents and Trademarks
which are necessary for the conduct of such Company's
business as now
conducted or presently proposed to be conducted
without any infringement upon rights of others which
might have a materially adverse effect on the
financial condition, business, assets, operations or
prospects of such Company to perform its obligations
under this Agreement, the Credit Agreement, or any
Loan Document: (i) to such Company's knowledge, each
of such material Patents and Trademarks is subsisting
and has not been adjudged invalid or unenforceable,
in whole or in part, (ii) to such Company's
knowledge, such Company is the sole and exclusive
owner of the entire and unencumbered right, title and
interest in and to each of such Patents and
Trademarks, free and clear of any liens, charges and
encumbrances, including, without limitation,
licenses, shop rights and covenants by such Company
not to sue third Persons, no claim has been made that
the use of any Trademark or Patent does or may
violate the rights of any third Person (other than
the claim asserted by Xxxxx Creditors Trust to
certain patents of Bairnco and Xxxxx in the
"Properties Lawsuit" as defined and described in
Bairnco's Annual Report on Form 10-k for the year
ended December 31, 1998), (iii) such Company has the
unqualified right to enter into this Agreement and
perform its terms and will take all reasonable steps
necessary to cause its present and future employees,
agents and consultants to comply with the
representations and warranties herein contained, and
(iv) no litigation is pending or, to the best
knowledge of such Company, threatened which contains
allegations respecting the validity of any of such
material Patents and Trademarks;
(g) none of the Collateral (other than Intangible
Collateral or Collateral acquired in the ordinary
course of business within the previous four (4)
months) has, within the four (4) months preceding the
date of this Agreement, been located at any place
other than such Company's own premises at the address
shown on the signature page hereto or at one or more
of the premises listed on Schedules III and IV hereto
and no more than $12,000,000 of Equipment and
Inventory is in transit and no more than $2,000,000
of Equipment and Inventory is located at third party
warehouses leased by Kasco territory managers;
(h) Schedule V hereto lists all trade names by which
such Company is now known;
(i) such Company's legal name is that set forth on
the signature page of this Agreement; and
(j) all other information provided herein is true
and correct in all material respects as of the date hereof.
Each representation and warranty made or to be
made herein by each Company shall be deemed remade as
of and at the date of each Loan made or Letter of
Credit issued from time to time under or in
connection with the Credit Agreement with the same
effect as if made contemporaneously with the making
of such Loan or issuance of such Letter of Credit,
with such exceptions which any Company shall have
given the Agent prior written notice of and which
have been approved by the Agent in writing with the
consent of the Required Lenders.
5. Processing, Sale, Collections, etc.
(a) Until notice from the Agent to the contrary, given at
any time after the occurrence and during the continuance
of any Default, each Company:
(i) may, in the ordinary course of its business, at its own
expense, sell, lease or furnish under contracts of service any of
the Inventory normally held by such Company for such purpose, and
use and consume, in the ordinary course of its business, any raw
materials, work in process or materials normally held by such
Company for such purpose, and make sales, in or out of the ordinary
course of business permitted by Section 7.2.9 of the Credit
Agreement, such permitted sales to be free and clear of the Security
Interest hereunder (but no such sale or-use shall
limit or impair the Agent's Security Interest in
any proceeds thereof, including, without
limitation, any Account),
(ii) will, at its own expense, endeavor to collect, as and when
due, all amounts due with respect to any of the Intangible
Collateral, including the taking of such action with
respect to such collection as the Agent may
reasonably request or, in the absence of such
request, as such Company may deem advisable, and
(iii) may grant, in the ordinary course of business, to any
Person obligated on any of the Intangible Collateral,
any rebate, refund or allowance to which such Person
may be lawfully entitled, and may accept, in
connection therewith, the return of goods, the sale
or lease of which shall have given rise to such
Intangible Collateral.
The Agent, however, may at any time, whether before
or after the maturity of any of the Obligations, so
long as a Default shall have occurred and be
continuing, (1) notify any Person obligated on any of
the Intangible Collateral to make payment to the
Agent of any amounts due or to become due thereunder;
(2) enforce collection of any of the Intangible
Collateral by suit or otherwise; (3) surrender,
release or exchange all or any part thereof, or
compromise or extend or renew for any period (whether
or not longer than the original period) any
indebtedness thereunder or evidenced thereby; and (4)
notify such Company (and upon receipt of such notice
such Company agrees to notify, at its sole expense,
any parties obligated on any of the Collateral) to
make payment to the Agent of any amount due or to
become due under the Collateral.
(b) If and to the extent that a perfected Security
Interest hereunder in any Collateral shall cease to
be perfected for any reason whatsoever (including,
without limitation, sale of Inventory or release of
all or any balance in any other account of any
Company or use or disposition by any Company of any
proceeds of Collateral), then such Collateral
(referred to in this paragraph as "Released
Collateral") shall be deemed thereby released from
the Security Interest hereunder in exchange, as of
the time of such release, for any other Collateral
(of the same or different type) of equivalent value
in which a perfected Security Interest is being
obtained contemporaneously or has been most recently
obtained hereunder, but only to the extent such other
Collateral does not represent either (x) Collateral
in exchange for which any previously Released
Collateral shall have been deemed released, or (y)
Collateral of equivalent value to any loan or
financial accommodation (otherwise than by renewal or
extension) from any Lender or the Agent to such
Company in which Collateral a perfected Security
Interest hereunder shall have been obtained
contemporaneously with or most recently prior to such
loan or financial accommodation.
(c) Upon the written request of the Agent, to be given at the
Agent's discretion at any time after the occurrence
and during the continuance of any Default, each
Company will, forthwith upon receipt, transmit and
deliver to the Agent in the form received, all cash,
checks, drafts and other instruments or writings for
the payment of money (properly endorsed, where
required, so that such items may be collected by the
Agent) which may be received by such Company at any
time in full or partial payment or otherwise as
proceeds of any Collateral. Except as the Agent may
otherwise consent in writing, after the occurrence
and during the continuance of a Default, any such
items which may be so received by such Company will
not be commingled by such Company with any of its
other funds or property, but, until delivery to the
Agent, will be held separate and apart from such
other funds and property and in trust for the Agent.
(d) Once a Default shall have occurred and be
continuing, all items or amounts which are delivered
by any Company to the Agent
(or collected directly by the Agent, as the case may
be) on account of partial or full payment or
otherwise as proceeds of any of the Collateral shall
be deposited to the credit of a deposit account
(herein referred to as the "Restricted Account") of
the Companies with the Agent, as security for
performance and payment of the Obligations. Such
Company shall have no right to withdraw any funds
deposited in the Restricted Account. Once a Default
shall have occurred and be continuing, the Agent may,
from time to time, in its discretion, apply all or
any of the then balance in the Restricted Account
toward payment of the Obligations, in such order of
application as the Agent may determine, and the Agent
may (but will not be required to), from time to time,
in its discretion, release all or any of such balance
representing collected funds to Bairnco (for
distribution to the Companies according to their
interests) by deposit thereof to the aforementioned
general deposit account.
(e) The Agent is authorized to endorse, in the name
of any Company, any item, howsoever received by the
Agent representing any Collateral or any payment on
or other proceeds of any of the Collateral.
6. Agreements of the Companies. Each Company shall:
(a) keep all its Inventory and other Goods, except for
no more than $12,000,000 of Equipment and Inventory
in transit and no more than $2,000,000 of Equipment
and Inventory located at third party warehouses leased by Kasco
territory managers or unless the Agent shall otherwise consent
in writing, at one or more of its own premises (as
shown on Schedule III hereto) or at one or more of
the premises listed on Schedule IV hereto; provided,
however, that (i) so long as no Default shall have
occurred and be continuing, each Company may
designate additional premises for inclusion on
Schedule IV hereto upon thirty (30) days' advance
written notice to the Agent and (ii) in the case of
the premises listed on Schedule IV hereto from time
to time, such Company's Inventory and other Goods
shall be kept separate from the Inventory and other
Goods of those Persons (other than another Company)
using such premises and shall be clearly and
conspicuously designated as being such Company's sole
property (for example, by posting signs or by
affixing such Company's name on its Inventory and
other Goods);
(b) furnish the Agent such information concerning each Company,
the Collateral and the Persons obligated on the Accounts as the
Agent may from time to time reasonably request;
(c) defend each Company's title to the Collateral against all
Persons and against all claims and demands whatsoever;
(d) do all acts reasonably necessary to maintain, preserve and
protect all Collateral, keep all Collateral in good condition and
repair (subject to normal wear and tear), and prevent any waste
or unusual or unreasonable depreciation thereof;
(e) comply in all material respects with all laws, rules and
regulations relating to, and promptly pay when due all license
fees, registration fees, taxes, assessments and other charges
which may be levied upon or assessed against, the ownership,
operation, possession, maintenance or use of the Collateral;
provided, however, that such Company shall not be required to
comply with any such law, rule or regulation, or to pay any such
fee, tax, assessment or other charge, the validity of which is
being contested by such Company in good faith by appropriate
proceedings so long as forfeiture of any part of the Collateral
will not result from the failure of such Company to comply with
any such law, rule or regulation, or to pay any such fee, tax,
assessment or other charge, during the period of such contest and
such Company maintains adequate reserves in accordance with GAAP
in connection with such contest;
(f) permit the Agent and designees of the Agent, from time to
time, (to the extent not prohibited by law) to inspect at
reasonable times the Inventory and Equipment, and to, at
reasonable times, inspect, audit and make copies of and extracts
from all records and all other papers in the possession of such
Company and will, upon request of the Agent, deliver to the Agent
all of such records and papers which pertain to the Collateral
and all Persons obligated with respect thereto;
(g) upon request of the Agent, stamp on its records concerning
the Collateral (and/or enter into its computer records concerning
the Collateral), a notation, in form satisfactory to the Agent,
of the Security Interests created hereby, and give all
appropriate notices of assignment and take all other appropriate
actions in accordance with the Federal Assignment of Claims Act
(31 U.S.C. 3727), as amended from time to time, with respect to
Collateral subject thereto;
(h) not sell, lease, assign, license, sublicense, abandon or
otherwise dispose of, or create or permit to exist any Security
Interest on any Collateral to or in favor of anyone other than
the Agent; provided, however, that, if no Default shall have
occurred and be continuing, such Company may engage in
transactions permitted under Sections 7.2.1(f), 7.2.2 and 7.2.9
of the Credit Agreement;
(i) at all times keep all Inventory and Equipment insured
against loss, damage, theft and other risks in the manner
required by Section 7.1.4 of the Credit Agreement and, if the
Agent so requests, deposit with the Agent originals or certified
copies of the relevant policies and certificates of insurance;
(j) furnish to the Agent notice in writing as soon as possible
and in any event not later than thirty (30) days prior to the
occurrence from time to time of (i) any change in the locations
of any part of the Collateral from the locations shown in
Schedules III and IV hereto, except for no more than $12,000,000
of Equipment and Inventory in transit and $2,000,000 of Equipment
and Inventory located at third party warehouses leased by Kasco territory
managers, (ii) any change in the location of such Company's chief executive
office, and (iii) any change in the name of such Company or the name
under or by which it conducts its business, each of such notices
also to contain evidence that such Company has taken all action
required or reasonably desirable to maintain and preserve the
Security Interest in favor of the Agent on the Collateral, free
and clear of any other Security Interest or encumbrance
whatsoever;
(k) reimburse the Agent for all reasonable expenses, including
attorneys' fees and legal expenses and reasonable expenses of any
repairs to realty or other property to which any Collateral may
be affixed or be a part, incurred by the Agent in seeking to
collect or enforce any rights under or with respect to the
Collateral, in seeking to collect the Notes and all other
Obligations, and in enforcing its rights hereunder, together with
interest thereon from the date incurred until reimbursed by such
Company at a rate per annum equal to the Default Rate;
(l) either itself or through licensees, unless such Company
shall reasonably determine that a Trademark is of negligible
economic value to such Company, (i) continue to use each
Trademark on each and every trademark class of goods with which
it is associated (as reflected in its catalogs, brochures and
price lists) in order to maintain each Trademark in full force
free from any claim of abandonment for non-use, (ii) maintain the
quality of products and services offered under each Trademark,
(iii) employ each Trademark with the appropriate notice of
application or registration, (iv) not adopt or use any mark which
is confusingly similar or a colorable imitation of any Trademark,
(v) not use any Trademark except for the uses for which
registration or application for registration of such Trademark
has been made, and (vi) not (and not permit any licensee or
sublicensee thereto to) do any act or knowingly omit to do any
act whereby any Trademark may become invalidated;
(m) at its sole expense, (i) without any request by the Agent,
immediately deliver or cause to be delivered to the Agent, in due
form for transfer (i.e., endorsed in blank or accompanied by duly
executed undated blank stock or bond powers in form and substance
satisfactory to the Agent), all Securities, Chattel Paper with a
face amount of or requiring payment in the aggregate amount of
$1,000,000 or more, Instruments with a face amount in excess of
$500,000 (other than checks received in payment for such
Company's goods or services in the ordinary course of business
that are collected or converted to cash within two weeks after
the receipt thereof) and Documents (other than Documents with a
value of less than $1,000,000 or that are not held by such
Company for more than 30 days), if any, at any time representing
all or any of the Collateral, (ii) at the Agent's request, cause
the Agent's Security Interest hereunder and under the other
Collateral Documents to be at all times duly noted on any
certificate of title issuable with respect to any of the
Collateral and forthwith deliver or cause to be delivered to the
Agent each such certificate of title, and (iii) forthwith,
execute and deliver or cause to be executed and delivered to the
Agent, in due form for filing or recording (and pay the cost of
filing or recording the same in all public offices deemed
necessary or advisable by the Agent) such assignments (including,
without limitation, assignments of life insurance with a cash
value of $1,000,000 or more), security agreements, mortgages,
deeds of trust, pledge agreements, consents, waivers, financing
statements, stock or bond powers, and other documents, and do
such other acts and things, all as may from time to time be
necessary or desirable to establish and maintain to the
satisfaction of the Agent a valid perfected lien on and security
interest in all assets of such Company now or hereafter existing
or acquired (free of all other liens, claims and rights of third
parties whatsoever other than Permitted Liens) to secure payment
and performance of the Obligations; and
(n) at the Agent's request after the occurrence and during the
continuance of a Default, transfer all or any part of the
Collateral into the name of the Agent or its nominee, with or
without disclosing that such Collateral is subject to the
Security Interest hereunder.
7. Renewals, Amendments and Other Security; Partial Releases.
(a) If at any time, whether before or after any of the
Obligations shall be due and payable, the Agent or any Lender
takes any or all of the Permitted Actions (as hereinafter
defined), such actions shall not affect the enforceability of
this Agreement, the Credit Agreement, or any of the other Loan
Documents or the Obligations. The Agent or a Lender, as the case
may be, shall have taken a Permitted Action if it shall: (i)
retain or obtain a Security Interest in any property to secure
payment and performance of any of the Obligations, (ii) retain or
obtain the primary or secondary obligation of any obligor or
obligors, in addition to the Companies', with respect to any of
the Obligations, (iii) extend or renew any of the Obligations for
one or more periods (whether or not longer than the original
period), alter or exchange any of the Obligations, or release or
compromise any obligation of any nature of any obligor with
respect to any of the Obligations, (iv) release or fail to
perfect its lien on and Security Interest in, or impair,
surrender, release or permit any substitution or exchange for,
all or any part of any property securing payment and performance
of any of the Obligations or any obligations hereunder, or extend
or renew for one or more periods (whether or not longer than the
original period) or release, compromise, alter or exchange any
obligations of any nature of any obligor with respect to any such
property, and (v) resort to the Collateral (or any thereof) for
payment of any of the Obligations when due, whether or not the
Agent or the Lenders shall have resorted to any
property securing any of the Obligations or shall
have proceeded against any Company or against any
other obligor primarily or secondarily obligated with
respect to any of the Obligations (all of the actions
referred to in this clause (v) being hereby expressly
waived by each Company).
(b) No release from the Security Interest created by this
Agreement of any part of the Collateral by the Agent
shall in any way alter, vary or diminish the force or
effect of any Security Interest created by this
Agreement against the balance or remainder of the
Collateral.
8. Grant of License to Use Intangibles.
Solely for the purpose of enabling the Agent to exercise rights
and remedies hereunder at such time as the Agent,
without regard to this Section 8, shall be lawfully
entitled to exercise such rights and remedies, each
Company hereby grants to the Agent an irrevocable,
nonexclusive license (exercisable without payment of
royalty or other compensation to any Company) to use,
assign, license or sublicense any of such Company's
General Intangibles, now owned or hereafter acquired
by such Company, and wherever the same may be
located, including in such license reasonable access
as to all media in which any of the licensed items
may be recorded or stored and to all computer
programs used for the compilation or printout
thereof; provided, however, that the Agent shall not
make any assignment of any General Intangible
hereunder which constitutes an assignment in gross.
No agreements hereafter acquired or agreed to or
entered into by such Company shall prohibit, restrict
or impair the Security Interest granted hereunder.
9. Information.
The Agent and any of the officers, employees, agents or auditors of
the Agent shall have the right at reasonable intervals after the date
hereof to make reasonable inquiries by mail,
telephone, telegraph or otherwise to any Person with
respect to validity and amount or any other matter
(including, without limitation, the assertion by any
Person of claims, offsets and counterclaims)
concerning any of the Collateral.
10. Default.
(a) (i) Whenever a Default shall be existing, the
Agent may exercise from time to time any rights and
remedies available to it hereunder, under the Credit
Agreement and under the Uniform Commercial Code as in
effect from time to time in New York or otherwise
available to it under applicable law. Each Company
agrees, upon the occurrence and continuance of such a
Default and upon the request of the Agent, to
assemble, at such Company's expense, all Inventory
and Equipment at convenient locations acceptable to
the Agent.
(ii) Each Company hereby expressly waives, to the fullest extent
permitted by applicable law, any and all notices, advertisements,
hearings or process of law in connection with the
Agent's exercise of any of its rights or remedies
upon a Default. If any notification of intended
disposition of any of the Collateral is required by
law, such notification, if mailed, shall be deemed
reasonably and properly given if mailed at least five
(5) days before such disposition, postage prepaid,
and addressed to Bairnco (for distribution by Bairnco
to each Company) either at the address of Bairnco
shown in the Credit Agreement or at any other address
of Bairnco which appears on the Agent's records. The
Agent may apply any proceeds of any of the Collateral
to the payment of all reasonable expenses which the
Agent incurs in connection with the enforcement of
this Agreement, including,
without limitation, reasonable attorneys' fees and
legal expenses. The Agent may apply any balance of
such proceeds toward the payment of such of the
Obligations, and in such order of application, as the
Agent may, in its sole discretion, elect from time to
time.
(b) Without limiting any other provision of this
Agreement: whenever a Default shall be existing, the
Agent may enter upon any premises where the
Collateral or any part thereof may be, and take
possession of all or any part thereof with or without
process of law; and the Agent may, without being
responsible for loss or damage, hold, store, keep
idle, use, lease, operate or otherwise use or permit
the use of the same or any part thereof or render all
or part thereof unusable for such time and upon such
terms as the Agent may deem to be commercially
reasonable, and may demand, collect and retain all
earnings and all other sums due and to become due in
respect of the same from any Person whomsoever,
accounting only for net earnings, if any, arising
from such use after charging against all receipts
from the use of the same or from the sale thereof, by
court proceedings or pursuant to Section 10(c) hereof
or otherwise, all costs and expenses of, and damages
or losses by reason of, such use or sale.
(c) The Companies jointly and severally hereby agree to
reimburse the Agent for any and all reasonable
expenses, including reasonable attorneys' fees and
legal expenses incurred by the Agent in seeking to
collect or enforce any rights under or with respect
to the Collateral, in seeking to collect the Notes
and all other Obligations, and in enforcing its
rights hereunder, together with interest thereon from
the date incurred until reimbursed by the Companies
at a rate per annum equal to the Default Rate.
(d) Each Company agrees that in any sale of any of
the Collateral, the Agent is authorized to comply
with any limitation or restriction in connection with
such sale as counsel may advise the Agent is
necessary in order to avoid any violation of
applicable law (including, without limitation,
compliance with such procedures as may restrict the
number of prospective bidders or purchasers, require
that such prospective bidders and purchasers have
certain qualifications, and restrict such prospective
bidders and purchasers to Persons who will represent
and agree that they are purchasing for their own
account or investment and not with a view to the
distribution or resale of such Collateral), or in
order to obtain any required approval of the sale or
of the purchaser by any governmental or regulatory
authority or official. Each Company further agrees
that such compliance shall not result in such sale
being considered or deemed not to have been made in a
commercially reasonable manner, nor shall the Agent
be liable or accountable to such Company for any
discount allowed by reason of the fact that such
Collateral was sold in compliance with any such
limitation or restriction.
(e) If sufficient sums are not realized upon any disposition of the
Collateral to pay all Obligations and any expenses of
such disposition, including, without limitation,
attorneys' fees, the Companies jointly and severally
hereby promise to pay immediately any resulting
deficiency.
(f) No right or remedy herein conferred is intended
to be exclusive of any other right or remedy, but
every such right or remedy shall be cumulative and
shall be in addition to every other right or remedy
herein conferred, or conferred upon the Agent by any
other agreement or instrument or security, or now or
hereafter existing at law or in equity or by statute.
11. Waiver of Subrogation.
Each Company hereby irrevocably waives any claim or other rights which it
may now or hereafter acquire against any other
Company or any Obligor that arise from
the existence, payment, performance or enforcement of
any Company's or Obligor's obligation under this
Agreement or any other Loan Document, including any
right of subrogation, reimbursement, exoneration, or
indemnification, any right to Participate in any
claim or remedy of the Lenders against any Company or
Obligor or any collateral which the Agent now has or
hereafter acquires, whether or not such claim, remedy
or right arises in equity, or under contract, statute
or common law, including the right to take or receive
from any Company or any Obligor, directly or
indirectly, in cash or other property or by set-off
or in any manner, payment or security on account of
such claim or other rights. If any amount shall be
paid to any Company in violation of the preceding
sentence and the Obligations shall not have been paid
in cash in full and the Commitments have not been
terminated, such amount shall be deemed to have been
paid to such Company for the benefit of, and held in
trust for, the Lenders, and shall forthwith be paid
to the Lenders to be credited and applied to the
Obligations, whether matured or unmatured.
12. Authority of the Agent.
(a) The Agent shall have, and be entitled to exercise, all such powers
hereunder as are specifically delegated to the Agent
by the terms hereof, together with such powers as are
incidental thereto. The Agent may execute any of its
duties hereunder by or through agents or employees
and shall be entitled to retain counsel and to act in
reliance upon the advice of such counsel concerning
all matters pertaining to its duties hereunder.
Neither the Agent, nor any director, officer,
employee or agent of the Agent, shall be liable for
any action taken or omitted to be taken by it
hereunder or in connection herewith, except for its
own gross negligence or willful misconduct. Each
Company agrees to reimburse the Agent, on demand, for
all reasonable costs and expenses incurred by the
Agent in connection with the administration and
enforcement of this Agreement (including costs and
expenses incurred by any agent employed by the Agent)
and agrees to indemnify (which indemnification shall
survive any termination of this Agreement) and hold
harmless the Agent and any such agent from and
against any and all liability incurred by the Agent
or such agent hereunder or in connection herewith,
unless such liability shall be due to gross
negligence or willful misconduct on the part of the
Agent or such agent, as the case may be.
(b) The Agent may from time to time, without notice to
any Company, at its option, perform any material
obligation to be performed by any Company hereunder,
under the Credit Agreement or under the Loan
Documents which shall not have been performed and
take any other action which the Agent deems necessary
for the maintenance or preservation of any of the
Collateral or its security interest in the
Collateral. All moneys advanced by the Agent in
connection with the foregoing shall, whether or not
there are then outstanding any credit extensions made
under the Credit Agreement or the Credit Agreement is
in effect, bear interest at the Default Rate (or such
lower maximum rate as shall be legal under applicable
law), and shall be repaid together with such interest
by the Companies to the Agent, upon the latter's
demand, and shall be secured hereby prior to any
other indebtedness or obligation secured hereby, but
the making of any such advance by the Agent shall not
relieve any Company of any default hereunder or
thereunder.
(c) The Agent, in its sole discretion, may apply any amounts
which it receives from whatever source on account of the
Obligations toward the payment of the Obligations in
such order of application as the Agent, in its sole
discretion, may from time to time elect, subject to
the terms and provisions of the
Credit Agreement.
13. Termination.
This Agreement shall terminate when
the Commitments shall be terminated and all the
Obligations have been fully paid and performed, at
which time the Agent shall reassign and redeliver (or
cause to be reassigned and redelivered) to each
Company or to such Person as each Company shall
designate, against receipt, such of the Collateral
(if any) assigned by each Company to the Agent as
shall not have been sold or otherwise applied by the
Agent pursuant to the terms hereof and shall still be
held by it hereunder, together with appropriate
instruments of reassignment and release. Any such
reassignment shall be without recourse upon or
representation or warranty by the Agent except a
warranty that the Agent has not encumbered or
otherwise reassigned such Collateral and shall be at
the sole cost and expense of such Company.
14. Protection of Patents and Trademarks.
(a) Each Company shall have the duty to protect,
preserve and maintain all rights in each of the
Significant Patents and Trademarks, including,
without limitation, the duty to prosecute and/or
defend against any and all suits contesting
infringement or dilution of the Significant Patents
and Trademarks, any other suits containing
allegations respecting the validity of the
Significant Patents and Trademarks, and any suits
claiming injury to the goodwill associated with any
of such Trademarks. Any expenses incurred in
protecting, preserving and maintaining the
Significant Patents and Trademarks shall be borne by
such Company. To the maximum extent permitted by law,
if a Company has failed to take a material action
requested by the Agent to so protect, preserve and
maintain the Significant Patents and Trademarks, the
Agent shall have the right, without taking title to
any such Patent or Trademark, to bring suit to
enforce any or all Significant Patents and
Trademarks, or licenses thereunder or its Security
Interest in any or all of the Significant Patents or
Trademarks or licenses thereunder, in which event
each Company shall, at the request of the Agent, do
any and all lawful acts and execute any and all
proper documents required by the Agent in aid of such
enforcement. All costs, expenses and other moneys
advanced by the Agent in connection with the
foregoing, shall, whether or not there are then
outstanding any Loans or Letters of Credit under the
Credit Agreement or the Credit Agreement is in
effect, bear interest at the Default Rate and shall
be repaid together with such interest by the
Companies to the Agent, upon the latter's demand, and
shall be secured hereby prior to any other
indebtedness or obligation secured hereby except
those incurred pursuant to Section 12(b) above, but
the making of any such advance by the Agent shall not
relieve such Company of any default hereunder. In
addition, the Companies jointly and severally hereby
indemnify (which indemnification shall survive any
termination of this Agreement) and hold harmless the
Agent from any and all liabilities, obligations,
losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements (including
reasonable attorneys' fees) of any kind whatsoever
which may be imposed on, incurred by or asserted
against the Agent in connection with or in any way
arising out of such suits, proceedings or other
actions. Notwithstanding the foregoing, the Agent
shall have no obligations or liabilities regarding
the Patents and Trademarks or any of them by reason
of, or arising out of, this Agreement.
(b) If any Default shall have occurred and be continuing, upon
the written demand of the Agent, each Company shall
execute and deliver to the Agent an assignment or
assignments of the Trademarks and Patents, and
licenses in favor of, or otherwise of value to, such
Company, and such other documents as are necessary
or appropriate to carry out the intent and purposes
of this Agreement; provided that the failure of such
Company to comply with such demand will not impair or
affect the validity of Section 2 hereof. Each Company
agrees that such an assignment shall be applied to
reduce the Obligations then due only to the extent
that the Agent receives cash proceeds in respect of
the sale of, or other realization upon, the
Trademarks, Patents and such other Collateral; such
cash proceeds to be applied to the payment of
expenses incurred in connection with the Trademarks,
Patents and such other Collateral, including
reasonable attorneys' fees and legal expenses, and
any balance of such proceeds shall be applied by the
Agent as provided in Section 10(a)(ii). Without
limiting any other rights and remedies of the Agent,
within five (5) Business Days of written notice from
the Agent, each Company shall make available to the
Agent, to the extent within such Company's power and
authority, such personnel in such Company's employ on
the date of the Default as the Agent may reasonably
designate, by name, title or job responsibility, to
permit such Company to continue, directly or
indirectly, to produce, advertise and sell the
products sold by such Company under the Trademarks,
such persons to be available to perform their prior
functions on the Agent's behalf and to be compensated
by the Agent on a per diem, pro-rata basis consistent
with the salary and benefit structure applicable to
each as of the date of such Default.
15. Governing Law; Consent to Jurisdiction and Service of Process.
(a) THIS AGREEMENT AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES. ALL JUDICIAL
PROCEEDINGS BROUGHT AGAINST ANY COMPANY ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR ANY OBLIGATIONS THEREUNDER, MAY BE
BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW
YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY
MAY BE BROUGHT, AT THE AGENT'S OPTION, IN THE COURTS
OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER
PROPERTY MAY BE FOUND. BY EXECUTING AND DELIVERING
THIS AGREEMENT, EACH BORROWER, FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH
COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREES THAT SERVICE OF ALL PROCESS IN
ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO IT AT ITS ADDRESS PROVIDED
IN ACCORDANCE WITH SECTION 10.4;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE
(III) ABOVE IS SUFFICIENT TO CONFER PERSONAL
JURISDICTION OVER ITSELF IN ANY SUCH PROCEEDING
IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT;
(V) AGREES THAT XXXXXXX RETAIN THE RIGHT TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR TO BRING PROCEEDINGS AGAINST COMPANY IN
THE COURTS OF ANY OTHER JURISDICTION; AND
(VI) AGREES THAT THE PROVISIONS OF THIS SECTION
15 RELATING TO JURISDICTION AND VENUE SHALL BE
BINDING AND ENFORCEABLE TO THE FULLEST EXTENT
PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS
LAW SECTION 5-1402 OR OTHERWISE.
(b) Each Company agrees not to institute any legal
action or proceeding against the Agent, any Lender
or the directors, officers, employees, agents or
property of any thereof, arising out of or relating
to this Agreement or any other Loan Document, in any
court other than the one hereinabove specified in
this Section 15. Nothing in this Section 15 shall
affect the right of the Agent or any Lender to serve
legal process in any other manner permitted by law
or affect the right of the Agent or any Lender to
bring any action or proceeding against any Company
or its property in the courts of any other
jurisdictions.
(c) Whenever possible, each provision of this Agreement shall
be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this
Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision
or the remaining provisions of this Agreement. All
obligations of each Company or any related Person and
rights of the Agent and any other holder of a note or
liability expressed in this Agreement shall be in
addition to and not in limitation of those provided
in applicable law or in any other written instrument
or agreement relating to any of the Obligations.
16. Miscellaneous Provisions.
(a) The Agent shall be deemed to have exercised
reasonable care in the custody and preservation of
any of the Collateral if it takes such action for
that purpose as any Company requests in
writing, but failure of the Agent to comply with any such request
shall not of itself be deemed a failure to exercise reasonable
care, and no failure of the Agent to preserve or protect any
rights with respect to Collateral against prior parties, or to do
any act with respect to the preservation of Collateral not so
requested by such Company, shall be deemed a failure to exercise
reasonable care in the custody or preservation of such
Collateral.
(b) Each Company hereby appoints the Agent, with full power of
substitution, as such Company's attorney-in-fact for
the purpose of carrying out the provisions of this
Agreement and taking any action and executing any
instrument which the 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, each Company agrees that the Agent shall
have the right and authority to make claim for, and
receive and give acquittances for payment on account
of, loss under any insurance policy covering the
Collateral, or any part thereof, and to receive,
endorse and collect all checks, drafts and other
orders for the payment of money representing the
proceeds of such insurance.
(c) No delay on the part of the Agent or any Lender
in exercising any right, power or remedy shall
operate as a waiver thereof, nor shall the single or
partial exercise of any such right, power or remedy
preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. No
amendment, modification or waiver of, or any consent
with respect to, any provision of this Agreement
shall in any event be effective unless the same shall
be in writing, and signed and delivered by the party
to be bound thereby, and then such amendment,
modification, waiver or consent shall be effective
only in the specific instance and for the purpose for
which given.
(d) All of each Company's obligations and all of the
Agent's rights, powers and remedies specified herein
are in addition to all other obligations, rights,
powers and remedies required of or
possessed by them, including, without limitation,
those provided by applicable law or in any other
written instrument or agreement relating to any of
the Obligations or any security therefor. Each
Company agrees that, if at any time all or any part
of any payment theretofore applied by the Agent to
any of the Obligations is or must be rescinded or
returned by the Agent for any reason whatsoever
(including, without limitation, the insolvency,
Bankruptcy or reorganization of any Company) such
Obligations shall, for the purposes of this
Agreement, to the extent that such payment is or must
be rescinded or returned, be deemed to have continued
in existence, notwithstanding such application by the
Agent, and this Agreement shall continue to be
effective or be reinstated, as the case may be, as to
such Obligations, all as though the Agent had not
made such application.
(e) The powers conferred on the Agent hereunder are
solely to protect its interest (on behalf of the
holders of the Obligations) in the Collateral and
shall not impose any duty on it to exercise any such
powers. Except for the safe custody of any Collateral
in its possession and the accounting for moneys
actually received by it hereunder, the Agent shall
have no duty as to any Collateral or responsibility
for (i) ascertaining or taking action with respect to
calls, conversions, exchanges, maturities, tenders or
other matters relative to any Collateral, whether or
not the Agent has or is deemed to have knowledge of
such matters, or (ii) taking any necessary steps to
preserve rights against prior parties or any other
rights pertaining to the Collateral.
(f) All notices or other communications hereunder
shall be given in the manner specified under Section
10.2 of the Credit Agreement.
(g) The rights and privileges of the Agent hereunder
shall inure to the benefit of its successors and
assigns. This Agreement shall be binding upon each
Company and its successors and assigns.
(h) At the option of the Agent, this Agreement, or a
carbon, photographic or other reproduction of this
Agreement or of any Uniform Commercial Code financing
statement covering the Collateral or any portion
thereof, shall be sufficient as a Uniform Commercial
Code financing statement and may be filed as such.
(i) The section headings in this Agreement are
inserted for convenience of reference and shall not
be considered a part of this Agreement or used in its
interpretation.
(j) This Agreement may be executed in any number of
counterparts and by the different parties on separate
counterparts and each such counterpart shall for all
purposes be deemed an original, but all such
counterparts shall together constitute but one and
the same Agreement. Each Company hereby acknowledges
receipt of a true, correct and complete counterpart
of this Agreement.
(k) THE COMPANIES HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION
WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE AGENT,
THE LENDERS OR THE COMPANIES. EACH COMPANY
ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH
OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH
IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE AGENT AND THE LENDERS ENTERING
INTO THE CREDIT AGREEMENT AND EACH SUCH OTHER LOAN
DOCUMENT.
(l) Each Company hereby expressly waives: (i) notice
of the acceptance by the Agent of this Agreement,
(ii) notice of the existence or creation or non-
payment of all or any of the Obligations, (iii) to
the fullest extent permitted by law,
presentment, demand, notice of dishonor, protest, and
all other notices whatsoever, and (iv) all diligence
in collection or protection of or realization upon
the Obligations or any thereof, any obligation
hereunder, or any security for or guaranty of any of
the foregoing.
(m) The Agent or any Lender may, from time to time,
whether before or after any of the Obligations shall
be due, in its sole discretion and without notice to
any Company (but subject to the terms and provisions
of the Credit Agreement), assign or transfer any or
all of its interest in the Obligations; and,
notwithstanding any such assignment or transfer or
any subsequent assignment or transfer thereof, such
Obligations shall be and remain Obligations for
purposes of this Agreement, and each and every
immediate and successive assignee or transferee of
any of the Obligations or of any interest therein
shall, to the extent of the interest of such assignee
or transferee in the Obligations, be entitled to the
benefits of this Agreement to the same extent as if
such assignee or transferee were the Agent or such
Lender (as the case may be).
(n) The Agent acts herein as agent for itself
and any and all present and future holders of the Obligations.
(o) Each Company hereby acknowledges that there are no
conditions to the effectiveness of this Agreement.
(p) If any item of Collateral hereunder also
constitutes collateral granted to the Agent under any other
mortgage, agreement or instrument, in the event of
any conflict between the provisions under this
Agreement and those under such other mortgage,
agreement or instrument relating to such Collateral,
the provision or provisions selected by the Agent
shall control with respect to such Collateral.
(q) The initial Companies hereunder shall be
the Bairnco and such Subsidiaries of Bairnco as are signatories
hereto on the date hereof. From time to time
subsequent to the date hereof, additional
Subsidiaries of Bairnco may become parties hereto as
additional Companies (each an "Additional Company"),
by executing a Counterpart substantially in the form
of Exhibit I annexed hereto. Upon delivery of any
such Counterpart to Agent, notice of which is hereby
waived by Companies, each such Additional Company
shall be a Company and shall be as fully a party
hereto as if such Company were an original signatory
hereto. Each Company expressly agrees that its
obligations arising hereunder shall not be affected
or diminished by the addition or release of any other
Company hereunder, nor by any election of Agent not
to cause any Subsidiary of Bairnco to become an
Additional Company hereunder. This Agreement shall
be fully effective as to any Company that is or
becomes a party hereto regardless of whether any
other Person becomes or fails to become or ceases to
be a Company hereunder.
(r) All obligations of the Companies hereunder
are joint and several obligations and failure by one Company to
perform its obligations under or relating to this
Agreement shall not relieve any other Company of any
obligation under or relating to this Agreement, the
Credit Agreement or any other Loan Document.
(s) All rights of the Agent and the Security
Interest granted to the Agent hereunder, and all obligations
of the Companies hereunder, shall be absolute and
unconditional, irrespective of (i) any lack of
validity or enforceability of the Credit Agreement,
the Notes, the Letters of Credit or any other Loan
Document or any instrument relating thereto, or (ii)
any other circumstance which might otherwise
constitute a defense available to, or a discharge of,
a guarantor or a third party grantor of a Security
Interest.
(t) The creation or existence from time to time
of additional Obligations is hereby authorized, without
notice to any Company, and shall in no way affect or
impair the Agent's rights and each Company's
obligations under this Agreement or any
other Loan Document.
17. Application of Insurance Proceeds.
Any loss benefits ("Benefits") under any of the insurance
policies maintained by each Company shall be
applied as follows:
(a) If no Default has occurred and is continuing
then such Benefits, together with any interest
thereon, shall be held by the Agent as additional
Collateral hereunder, but, so long as no Default has
occurred and is continuing, such Benefits may, at
such Company's discretion, be either:
(i) applied by the Agent to the repayment of the
Obligations under the Credit Agreement, subject to all of
the terms and conditions of the Credit Agreement, or
(ii) at any time used by such Company to repair or replace the
damaged or destroyed Collateral giving rise to such Benefits.
(b) If a Default occurs or is continuing while
the Agent is holding any Benefits pursuant to this
Section 17, the Agent may apply such Benefits as
provided in Section 10(a)(ii).
18. Reaffirmation and Modification of Original Loan Documents.
It is the intention of each of the parties hereto that the Existing Security
Agreement be amended and restated to confirm
and continue the security interests granted
thereby and so as to preserve the perfection
and priority of all security interests
securing indebtedness under the Original
Credit Agreement and the other Loan Documents
(as defined in the Original Credit Agreement)
and that all indebtedness and obligations of
the Borrowers and the guarantors under the
Original Credit Agreement and the other Loan
Documents (as defined in the Original Credit
Agreement) shall be secured by this Agreement
and the other Loan Documents and that this
Agreement shall not constitute a novation of
the obligations and liabilities existing
under the Existing Security Agreement. The
parties hereto further acknowledge and agree
that this Agreement constitutes an amendment
of the Existing Security Agreement made under
the terms thereof.
IN WITNESS WHEREOF, this Agreement has been
duly executed as of the day and year first
above written.
BAIRNCO CORPORATION
By. /s/ Xxxxx X. Xxxxxxx
Name Xxxxx X. Xxxxxxx
Title: VP Finance
XXXXX, INC.
By. /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: VP
KASCO CORPORATION
By. /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: VP
MII INTERNATIONAL, INC.
By. /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: VP
BANK OF AMERICA, N.A., as Agent
By.
Name:
Title:
EXHIBIT I TO SECURITY AGREEMENT
[FORM OF COUNTERPART]
COUNTERPART (this "Counterpart"), dated
_______, is delivered pursuant to Section 16(q) of
the Security Agreement referred to below. The
undersigned hereby agrees that this Counterpart
may be attached to the Amended and Restated Security
Agreement, dated as of February 22, 2000 (as it may
be from time to time amended, modified or
supplemented, the "Security Agreement";
capitalized terms used herein not otherwise defined
herein shall have the meanings ascribed therein),
among Bairnco Corporation, a Delaware corporation,
the other Companies named therein, and Bank of
America, N.A., as Agent. The undersigned by
executing and delivering this Counterpart hereby
becomes a Company under the Security Agreement in
accordance with Section 16(q) thereof and agrees to
be bound by all of the terms thereof.
Without limiting the generality of the foregoing, the
undersigned hereby:
(i) authorizes the Agent to add the
information set forth on the Schedules
to this Agreement to the correlative
Schedules attached to the Security
Agreement ;
(ii) agrees that all Collateral of the
undersigned, including the items of
property described on the Schedules
hereto, shall become part of the
Collateral and shall secure all
Obligations; and
(iii) makes the representations and
warranties set forth in the Security
Agreement, as amended hereby, to the
extent relating to the undersigned.
[NAME OF
ADDITIONAL COMPANY]
By:
_______________________
____
Name:
Title:
_______________________________
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Insert appropriate interest rate option.
