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EXHIBIT 10.67
PLEDGE AND SECURITY AGREEMENT
PLEDGE AND SECURITY AGREEMENT dated as of March 15, 2001 (this
"Agreement") made by CAREMARK RX, INC., a Delaware corporation (the "COMPANY"),
the SUBSIDIARIES of the Company listed on the signature pages hereof (the
"SUBSIDIARIES") and the ADDITIONAL GRANTORS (as defined in Section 19) (the
Company, the Subsidiaries and the Additional Grantors being, collectively, the
"GRANTORS"), to LASALLE BANK NATIONAL ASSOCIATION, as trustee ("TRUSTEE") for
holders of the Secured Obligations (as defined below) under the Trust Agreement
(as defined below).
PRELIMINARY STATEMENTS.
(1) The Company entered into a $1,000,000,000 Amended and
Restated Credit Agreement dated as of June 9, 1998, as amended (the "EXISTING
CREDIT AGREEMENT") with the financial institutions party thereto as lenders,
swing line banks and issuing banks, Credit Lyonnais New York Branch, The First
National Bank of Chicago and Xxxxxx Guaranty Trust Company of New York, as
syndication agents, Banc of America Securities LLC (formerly known as
NationsBanc Xxxxxxxxxx Securities LLC), as arranger and Bank of America, N.A.
(formerly known as NationsBank, N.A.) as administrative agent.
(2) The Company has issued $450,000,000 of its 7 3/8%
Senior Notes due 2006 (the "SENIOR PUBLIC NOTES") pursuant to an Indenture dated
as of October 8, 1996 (as supplemented from time to time, the "INDENTURE") among
the Company, as issuer and U.S. Bank National Association, as successor trustee
for the holders of the Senior Public Notes.
(3) To replace the Existing Credit Agreement, the Company
concurrently herewith is entering into a Credit Agreement dated as of March 15,
2001 (as hereafter amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT" and, together with the Indenture, the "DEBT
INSTRUMENTS") with the financial institutions party thereto from time to time as
lenders, swing line banks, and issuing banks and as agents thereunder, including
Bank of America, N.A., as administrative agent (the "ADMINISTRATIVE AGENT")
(such lenders, swing line banks, issuing banks and agents, collectively, the
"PRIVATE LENDERS" and in connection therewith, the Subsidiaries have entered
into a Guarantee dated the date hereof (as hereafter restated, amended,
supplemented or otherwise modified from time to time the, "GUARANTEE") pursuant
to which the Subsidiaries guaranteed the obligations of the Company under the
Credit Agreement.
(4) The Company, the Subsidiaries and the Trustee have
entered into a Trust Agreement dated as of the date hereof (as hereafter
restated, amended, supplemented or otherwise modified from time to time the,
"TRUST AGREEMENT").
(5) The Company from time to time may enter into interest
rate hedge agreements (the "HEDGE AGREEMENTS") with financial institutions (the
"HEDGE BANKS") party to the Credit Agreement to the extent permitted therein,
and the obligations of the Company thereunder will be guaranteed by the
Subsidiaries pursuant to the Guarantee.
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(6) Pursuant to the Credit Agreement and the Indenture,
the Grantors are entering into this Agreement in order to grant to the Trustee,
for the equal and ratable benefit of the Private Lenders, the holders of the
Senior Public Notes and the Hedge Banks (the "SECURED PARTIES"), a security
interest in the personal property and fixtures of the Grantors as provided
herein now owned or hereafter acquired to secure, subject to the terms and
conditions of this Agreement and the Trust Agreement, the payment of all of the
Company's obligations owing under the Credit Agreement and the documents
delivered in connection therewith, the Subsidiaries' and Additional Grantors'
obligations owing under the Guarantee and the payment of all of the Company's
obligations owing under the Senior Public Notes.
(7) Pursuant to the Trust Agreement, the Grantors have
opened a trust account (the "TRUST ACCOUNT"), which may consist from time to
time of one or more sub-accounts (as provided in the Trust Agreement) with the
Trustee at its office at Chicago, Illinois, Account No. 60-8373-00-7, in the
name of "CAREMARK RX, INC. TRUST ACCOUNT" and a L/C Cash Collateral Account (the
"L/C CASH COLLATERAL ACCOUNT") with the Trustee at its office at Chicago,
Illinois, Account No. 60-8373-01-5, in the name of "Caremark Rx, Inc. Cash
Collateral Account," but in each case under the sole control and dominion of the
Trustee and subject to the terms of this Agreement.
(8) Unless otherwise defined in this Agreement or in the
Trust Agreement, terms defined in Article 8 or 9 of the Uniform Commercial Code
in effect in the State of New York ("N.Y. UNIFORM COMMERCIAL CODE") are used
herein as so defined.
NOW, THEREFORE, in consideration of the premises and in order
to fulfill their obligations under the Debt Instruments, each Grantor hereby
agrees with the Trustee for the equal and ratable benefit of the Secured Parties
as follows:
Section 1. Grant of Security.
Each Grantor hereby assigns and pledges to the Trustee for its
benefit and the equal and ratable benefit of the Secured Parties, and hereby
grants to the Trustee for its benefit and the equal and ratable benefit of the
Secured Parties a security interest in, such Grantor's right, title and interest
in and to the following, in each case, as to each type of property described
below, whether now owned (except in respect of Pledged Debt as provided for
below) or hereafter acquired by such Grantor, wherever located, and whether now
or hereafter existing or arising (collectively, the "COLLATERAL"):
(a) all equipment in all of its forms, all fixtures
(except to the extent that a grant of a security interest in any such
fixtures located on leased premises would not be permitted by the
respective lease) and all parts thereof and all accessions thereto (any
and all such equipment, fixtures, parts and accessions being the
"EQUIPMENT");
(b) all inventory in all of its forms, and including,
without limitation (i) raw materials and work in process therefor,
finished goods thereof and materials used or consumed in the
manufacture, production, preparation or shipping thereof, (ii) goods in
which such Grantor has an interest in mass or a joint or other interest
or right of any kind (including, without limitation, goods in which
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such Grantor has an interest or right as consignee) and (iii) goods
that are returned to or repossessed or stopped in transit by such
Grantor, and all accessions thereto and products thereof and documents
therefor (any and all such inventory, accessions, products and
documents being the "INVENTORY");
(c) all accounts, chattel paper, instruments, deposit
accounts, general intangibles, contract rights and other obligations of
any kind, whether or not arising out of or in connection with the sale
or lease of goods or the rendering of services and whether or not
earned by performance, and all rights now or hereafter existing in and
to all security agreements, leases and other contracts securing or
otherwise relating to any such accounts, chattel paper, instruments,
deposit accounts, general intangibles, contract rights or obligations
(any and all such accounts, chattel paper, instruments, deposit
accounts, general intangibles, contract rights and obligations, to the
extent not referred to in clause (d), (e) or (f) below, being the
"RECEIVABLES", and any and all such security agreements, leases and
other contracts being the "RELATED CONTRACTS");
(d) the following (the "SECURITY COLLATERAL"):
(i) the shares set forth opposite such Grantor's
name on and as otherwise described in Part I of Schedule I
hereto (the "INITIAL PLEDGED SHARES") and the certificates, if
any, representing the Initial Pledged Shares, and all
dividends, cash, instruments and other property from time to
time received, receivable or otherwise distributed in respect
of or in exchange for any or all of the Initial Pledged
Shares;
(ii) all additional shares of stock from time to
time acquired by such Grantor in any manner (such shares,
together with the Initial Pledged Shares, being the "PLEDGED
SHARES"), and the certificates, if any, representing such
additional shares, and all dividends, cash, instruments and
other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or
all of such shares;
(iii) all indebtedness from time to time hereafter
incurred by a single obligor, maker or payee and payable to
such Grantor in a principal amount in excess of $1,000,000
(such indebtedness being the "PLEDGED DEBT") and the
instruments, if any, evidencing such indebtedness, and all
interest, cash, instruments and other property from time to
time received, receivable or otherwise distributed in respect
of or in exchange for any or all of such indebtedness;
(iv) all other investment property (including any
notes or securities issued by any entity) in which such
Grantor has now, or acquires from time to time hereafter, any
right, title or interest in any manner, and the certificates
or instruments, if any, representing or evidencing such
investment property, and all dividends, interest,
distributions, value, cash, instruments and other property
from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of
such investment property, and all letter of credit rights;
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(e) the following (collectively, the "ACCOUNT
COLLATERAL"):
(i) the Trust Account and the L/C Cash
Collateral Account, all funds held therein and all
certificates and instruments, if any, from time to time
representing or evidencing the Trust Account;
(ii) all Collateral Investments (as hereinafter
defined) from time to time and all certificates and
instruments, if any, from time to time representing or
evidencing the Collateral Investments;
(iii) all notes, certificates of deposit, deposit
accounts, checks and other instruments from time to time
hereafter delivered to or otherwise possessed by the Trustee
for or on behalf of the Grantor in substitution for or in
addition to any or all of the then existing Account
Collateral; and
(iv) all interest, dividends, cash, instruments
and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or
all of the then existing Account Collateral; and
(v) all deposit accounts of such Grantor from
time to time, all funds held therein and all certificates and
instruments, if any, from time to time representing or
evidencing such deposit accounts.
(f) the following (collectively, the "INTELLECTUAL
PROPERTY COLLATERAL"):
(i) all United States, international and foreign
patents, patent applications and statutory invention
registrations, including, without limitation, the patents and
patent applications set forth in Schedule IV hereto (as such
Schedule IV may be supplemented from time to time by
supplements to this Agreement, each such supplement being in
substantially the form of Exhibit C hereto (an "IP SECURITY
AGREEMENT SUPPLEMENT"), executed and delivered by such Grantor
to the Trustee from time to time), together with all reissues,
divisions, continuations, continuations-in-part, extensions
and reexaminations thereof, all inventions therein, all rights
therein provided by international treaties or conventions and
all improvements thereto, and all other rights of any kind
whatsoever of such Grantor accruing thereunder or pertaining
thereto (the "PATENTS");
(ii) all trademarks (including, without
limitation, service marks), certification marks, collective
marks, trade dress, logos, domain names, product
configurations, trade names, business names, corporate names
and other source identifiers, whether or not registered,
whether currently in use or not, including, without
limitation, all common law rights and registrations and
applications for registration thereof, including, without
limitation, the trademark registrations and trademark
applications set forth in Schedule IV hereto (as such Schedule
IV may be supplemented from time to time by IP Security
Agreement Supplements executed and delivered by such Grantor
to the Trustee from time to time), and all other marks
registered in the U.S. Patent and Trademark Office or in any
office or
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agency of any State or Territory of the United States or any
foreign country (but excluding any United States intent-to-use
trademark application prior to the filing and acceptance of a
Statement of Use or an Amendment to allege use in connection
therewith to the extent that a valid security interest may not
be taken in such an intent-to-use trademark application under
applicable law), and all rights therein provided by
international treaties or conventions, all reissues,
extensions and renewals of any of the foregoing, together in
each case with the goodwill of the business connected
therewith and symbolized thereby, and all rights corresponding
thereto throughout the world and all other rights of any kind
whatsoever of such Grantor accruing thereunder or pertaining
thereto (the "TRADEMARKS");
(iii) all copyrights, copyright applications,
copyright registrations and like protections in each work of
authorship, whether statutory or common law, whether published
or unpublished, any renewals or extensions thereof, all
copyrights of works based on, incorporated in, derived from,
or relating to works covered by such copyrights, including,
without limitation, the copyright registrations and copyright
applications set forth in Schedule IV hereto (as such Schedule
IV may be supplemented from time to time by IP Security
Agreement Supplements executed and delivered by such Grantor
to the Trustee from time to time), together with all rights
corresponding thereto throughout the world and all other
rights of any kind whatsoever of such Grantor accruing
thereunder or pertaining thereto (the "COPYRIGHTS");
(iv) all confidential and proprietary
information, including, without limitation, know-how, trade
secrets, manufacturing and production processes and
techniques, inventions, research and development information,
technical data, financial, marketing and business data,
pricing and cost information, business and marketing plans and
customer and supplier lists and information (the "TRADE
SECRETS");
(v) all computer software programs and databases
(including, without limitation, source code, object code and
all related applications and data files), firmware, and
documentation and materials relating thereto, and all rights
with respect to the foregoing, together with any and all
options, warranties, service contracts, program services, test
rights, maintenance rights, improvement rights, renewal rights
and indemnifications and any substitutions, replacements,
additions or model conversions of any of the foregoing, but
excluding any of the foregoing that is the subject of an
agreement incurred in the ordinary course of business
containing customary terms which prohibit the assignment
thereof or the granting of a security interest therein (such
non-excluded property, the "COMPUTER SOFTWARE");
(vi) all license agreements, permits,
authorizations and franchises, whether with respect to the
Patents, Trademarks, Copyrights, Trade Secrets or Computer
Software, or with respect to the patents, trademarks,
copyrights, trade secrets, computer software or other
proprietary right of any other Person,
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including, without limitation, the license agreements set
forth in Schedule IV (excluding shrink wrap, click wrap and
license agreements governing licenses of commercial off the
shelf software, shareware, or freeware, as such Schedule IV
may be supplemented from time to time by IP Security Agreement
Supplements executed and delivered by such Grantor to the
Trustee from time to time or otherwise), and all income,
royalties and other payments now or hereafter due and/or
payable with respect thereto, subject, in each case, to the
terms of such license agreements, permits, authorizations and
franchises, but excluding any of the foregoing that is the
subject of an agreement incurred in the ordinary course of
business containing customary terms which prohibit such
Grantor from assigning its rights thereto or granting a
security interest therein, (such non-excluded property, the
"LICENSES"); and
(vii) any and all claims for damages for past,
present and future infringement, misappropriation or breach
with respect to the Patents, Trademarks, Copyrights, Trade
Secrets, Computer Software or Licenses, with the right, but
not the obligation, to xxx for and collect, or otherwise
recover, such damages; and
(g) all proceeds of any and all of the Collateral
(including, without limitation, proceeds that constitute property of
the types described in clauses (a) through (f) of this Section 1 and
this clause (g)) and, to the extent not otherwise included, all (i)
payments under insurance (whether or not the Trustee is the loss payee
thereof), or any indemnity, warranty or guaranty, payable by reason of
loss or damage to or otherwise with respect to any of the foregoing
Collateral and (ii) cash;
provided, however, that none of the collateral described and none of the terms
defined in clauses (a) - (g) above shall include any rights, assets or property
assigned, sold or transferred, or in which a security interest is granted, by
Caremark Inc. in connection with a Caremark Receivables Securitization as
defined in the Credit Agreement.
Section 2. Security for Obligations.
This Agreement secures, in the case of the Company, the
payment of all obligations of the Company now or hereafter existing under the
Debt Instruments and under any Hedge Agreement with a Hedge Bank permitted under
the Credit Agreement, and, in the case of each other Grantor, the payment of all
obligations of the Company now or hereafter existing under the Indenture and the
payment of all obligations of such Grantor now or hereafter existing under the
Guarantee, whether direct or indirect, absolute or contingent, and whether for
principal, reimbursement obligations, interest, fees, premiums, penalties,
indemnifications, contract causes of action, costs, expenses or otherwise (all
such obligations being the "SECURED OBLIGATIONS").
Section 3. Grantors Remain Liable.
Anything herein to the contrary notwithstanding, (a) each
Grantor shall remain liable under the contracts and agreements included in such
Grantor's Collateral to the extent set forth therein to perform all of its
duties and obligations thereunder to the same extent as if this
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Agreement had not been executed, (b) the exercise by the Trustee of any of the
rights hereunder shall not release any Grantor from any of its duties or
obligations under the contracts and agreements included in the Collateral and
(c) no Secured Party shall have any obligation or liability under the contracts
and agreements included in the Collateral by reason of this Agreement or any
other Debt Instrument, nor shall any Secured Party be obligated to perform any
of the obligations or duties of any Grantor thereunder or to take any action to
collect or enforce any claim for payment.
Section 4. Delivery and Control of Security Collateral.
(a) All certificates or instruments representing or
evidencing Security Collateral or Account Collateral shall be delivered
to and held by or on behalf of the Trustee pursuant hereto and shall be
in suitable form for transfer by delivery, or shall be accompanied by
duly executed instruments of transfer or assignment in blank, all in
form and substance satisfactory to the Trustee. For the better
perfection of the Trustee's rights in and to the Security Collateral
and the Account Collateral, each Grantor shall forthwith, upon the
pledge of any Security Collateral or Account Collateral hereunder
(other than deposit accounts), cause such Security Collateral or
Account Collateral to be registered in the name of the Trustee or such
of its nominees as the Trustee shall direct, subject only to the
revocable rights specified in Section 14(a). In addition, the Trustee
shall have the right at any time to exchange certificates or
instruments representing or evidencing Security Collateral or Account
Collateral for certificates or instruments of smaller or larger
denominations.
(b) With respect to any Security Collateral that
constitutes a security and is not represented or evidenced by a
certificate or an instrument, each Grantor, at the request of the
Trustee, shall cause the issuer thereof either (i) to register the
Trustee as the registered owner of such security or (ii) to agree in
writing with such Grantor and the Trustee that such issuer will comply
with instructions with respect to such security originated by the
Trustee without further consent of such Grantor, such agreement to be
in form and substance satisfactory to the Trustee.
(c) With respect to any Security Collateral that
constitutes a security entitlement, each Grantor, at the request of the
Trustee, shall cause the securities intermediary with respect to such
security entitlement either (i) to identify in its records the Trustee
as having such security entitlement against such securities
intermediary or (ii) to agree in writing with such Grantor and the
Trustee that such securities intermediary will comply with entitlement
orders (that is, notifications communicated to such securities
intermediary directing transfer or redemption of the financial asset to
which such Grantor has a security entitlement) originated by the
Trustee without further consent of such Grantor, such agreement to be
in form and substance satisfactory to the Trustee.
(d) With respect to any Security Collateral that
constitutes a securities account, each Grantor, at the request of the
Trustee, will, in the case of a securities account, comply with
subsection (c) of this Section 4 with respect to all security
entitlements carried in such securities account.
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Section 5. Maintaining the Trust Account.
Until the release of the collateral granted herein as provided
in Section 6.1 of the Trust Agreement:
(a) The Grantors will maintain the Trust Account with the
Trustee.
(b) It shall be a term and condition of the Trust
Account, notwithstanding any term or condition to the contrary in any
other agreement relating to the Trust Account (except the Trust
Agreement), and except as otherwise provided by the provisions of
Section 17, that no amount (including interest or dividends on
Collateral Investments) shall be paid or released to or for the account
of, or withdrawn by or for the account of, any Grantor or any other
Person from the Trust Account.
The Trust Account shall be subject to such applicable laws and such applicable
regulations of the Board of Governors of the Federal Reserve System and of any
other appropriate banking or governmental authority, as may now or hereafter be
in effect.
Section 6. Maintaining the L/C Cash Collateral Account.
Until the release of the collateral granted herein as provided
in Section 6.1 of the Trust Agreement:
(a) The Company will maintain the L/C Cash Collateral
Account with the Trustee.
(b) It shall be a term and condition of the L/C Cash
Collateral Account, notwithstanding any term or condition to the
contrary in any other agreement relating to the L/C Cash Collateral
Account (except the Trust Agreement), and except as otherwise provided
by the provisions of Section 17, that no amount (including interest or
dividends on Collateral Investments) shall be paid or released to or
for the account of, or withdrawn by or for the account of, any Grantor
or any other Person from the L/C Cash Collateral Account.
The L/C Cash Collateral Account shall be subject to such applicable laws and
such applicable regulations of the Board of Governors of the Federal Reserve
System and of any other appropriate banking or governmental authority, as may
now or hereafter be in effect.
Section 7. Investing of Amounts in the Trust Account
and the L/C Cash Collateral Account.
The Trustee will, subject to the provisions of Section 17
hereof, from time to time invest amounts on deposit in the Trust Account and the
L/C Cash Collateral Account as permitted by Section 3.3 of the Trust Agreement
(such investments being the "COLLATERAL INVESTMENTS"). Interest and proceeds
thereof that are not invested or reinvested in Collateral Investments as
provided above shall be deposited and held in the Trust Account or L/C Cash
Collateral Account, as the case may be.
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Section 8. Representations and Warranties.
Each Grantor represents and warrants as follows:
(a) All of the Equipment and Inventory of such Grantor
are located at the places specified therefor in Schedule II hereto. The
jurisdiction of formation of such Grantor is as set forth in Schedule
III hereto. The chief executive office of such Grantor is located at
the address specified therefor in Schedule III hereto. Such Grantor's
federal tax identification number is set forth opposite such Grantor's
name in Schedule III hereto. All Security Collateral consisting of
certificated securities and instruments have been delivered to the
Trustee. None of the Receivables is evidenced by a promissory note or
other instrument under the Credit Agreement is required to be delivered
to the Trustee and that has not been delivered to the Trustee.
(b) Such Grantor is the legal and beneficial owner of the
Collateral of such Grantor free and clear of any Lien, claim, option or
right of others, except for the security interest created under this
Agreement and Permitted Liens (as defined in the Credit Agreement). No
effective financing statement or other instrument similar in effect
covering all or any part of such Collateral or listing such Grantor or
any trade name of such Grantor as debtor is on file in any recording
office, except such as may have been filed in favor of the Trustee
relating to this Agreement. Such Grantor has no trade names.
(c) Such Grantor has exclusive possession and control of
the Equipment and Inventory.
(d) The Pledged Shares pledged by such Grantor hereunder
have been duly authorized and validly issued and are fully paid and
non-assessable.
(e) The Initial Pledged Shares constitute the percentage
of the issued and outstanding shares of stock of the issuers thereof
indicated on Schedule I hereto as of the date hereof.
(f) All of the investment property owned by such Grantor
as of the date hereof is listed on Schedule I hereto.
(g) (1) The possession by the Trustee of the certificates
representing the Pledged Shares, together with undated stock powers
executed in blank, and of the instruments representing Pledged Debt
duly indorsed or accompanied by duly executed instruments of transfer
or assignment, creates a valid and perfected first priority security
interest in such Pledged Shares and Pledged Debt, respectively, and (2)
the pledge of the Security Collateral pursuant to this Agreement, the
pledge and assignment of the Account Collateral pursuant hereto, and
the filing of financing statements in respect of the Collateral in
favor of the Trustee with the appropriate filing offices of the
appropriate jurisdictions, create a valid and perfected first priority
security interest in the Collateral to the extent such security
interest can be perfected only by the filling of a financing statement,
in each case securing the payment of the Secured Obligations.
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(h) No authorization or approval or other action by, and
no notice to or filing with, any United States, federal, state or local
governmental authority or regulatory body is required for (i) the grant
by such Grantor of the assignment, pledge and security interest granted
hereunder or for the execution, delivery or performance of this
Agreement by such Grantor, (ii) the perfection or maintenance of the
assignment, pledge and security interest created hereunder (including
the first priority nature of such assignment, pledge or security
interest), except for the filing of financing and continuation
statements under the Uniform Commercial Code, which financing
statements have been or will be duly filed, the recordation of the
Intellectual Property Security Agreements referred to in Section 13(f)
with the U.S. Patent and Trademark Office and the U.S. Copyright
Office, which Agreements have been or will be duly recorded and the
actions described in Section 4 with respect to Security Collateral,
which actions will be taken and the filing or recording of fixture
filings, or (iii) for the exercise by the Trustee of its voting or
other rights provided for in this Agreement or the remedies in respect
of the Collateral pursuant to this Agreement, except as may be required
in connection with the disposition of any portion of the Security
Collateral by laws affecting the offering and sale of securities
generally.
(i) The Inventory that has been produced or distributed
by such Grantor has been produced in compliance with all requirements
of applicable law, including, without limitation, the Fair Labor
Standards Act.
(j) As to itself and its Intellectual Property
Collateral:
(i) To such Grantor's knowledge, the rights of
such Grantor in or to the Intellectual Property Collateral do
not conflict with, misappropriate or infringe upon the
intellectual property rights of any third party, and no claim
has been asserted that the use of such Intellectual Property
Collateral does or may infringe upon the intellectual property
rights of any third party.
(ii) Such Grantor is the exclusive owner of the
entire and unencumbered right, title and interest in and to
the Intellectual Property Collateral and is entitled to use
all such Intellectual Property Collateral without limitation,
subject only to the license terms of the Licenses.
(iii) The Intellectual Property Collateral set
forth on Schedule IV hereto includes all of the patents,
patent applications, trademark registrations and applications,
copyright registrations and applications and Licenses owned by
such Grantor.
(iv) The Intellectual Property Collateral is
subsisting and has not been adjudged invalid or unenforceable,
in whole or part, and to the best of such Grantor's knowledge,
is valid and enforceable. Such Grantor is not aware of any
uses of any item of Intellectual Property Collateral that
could be expected to lead to such item becoming invalid or
unenforceable.
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(v) To such Grantor's knowledge, such Grantor
has made or performed all filings, recordings and other acts
and has paid all required fees and taxes to maintain and
protect its interest in each and every item of Intellectual
Property Collateral in full force and effect in the United
States, and to protect and maintain its interest therein
including, without limitation, recordations of any of its
interests in the Patents and Trademarks with the U.S. Patent
and Trademark Office and recordation of any of its interests
in the Copyrights with the U.S. Copyright Office. Such Grantor
has used proper statutory notice in connection with its use in
the United States of each patent, trademark and copyright of
the Intellectual Property Collateral.
(vi) Except as set forth on Schedule IV hereto,
no action, suit, investigation, litigation or proceeding is
pending or, to the knowledge of such Grantor, overtly
threatened against such Grantor (i) based upon or challenging
or seeking to deny or restrict the use of any of the
Intellectual Property Collateral, or (ii) alleging that any
services provided by, processes used by, or products
manufactured or sold by, such Grantor infringe upon or
misappropriate any patent, trademark, copyright or any other
proprietary right of any third party. To the best of such
Grantor's knowledge except as set forth on Schedule IV hereto,
no Person is engaging in any activity that infringes upon or
misappropriates the Intellectual Property Collateral or upon
the rights of such Grantor therein. Except as set forth on
Schedule IV hereto, such Grantor has not granted any license,
release, covenant not to xxx, non-assertion assurance, or
other right to any Person with respect to any part of the
Intellectual Property Collateral other than in the ordinary
course of business. The consummation of the transactions
contemplated by the Transaction Documents will not result in
the termination or impairment of any of the Intellectual
Property Collateral.
(vii) To such Grantor's knowledge, with respect to
each License: (A) such License will not cease to be valid and
binding and in full force as a result of the rights and
interest granted herein, nor will the grant of such rights and
interest constitute a breach or default under such License or
otherwise give the licensor or licensee a right to terminate
such License; (B) such Grantor has not received any notice of
termination or cancellation under such License; (C) such
Grantor has not received any notice of a breach or default
under such License, which breach or default has not been
cured; and (D) such Grantor has enforced quality control over
the licenses of its Trademarks under the applicable Licenses.
(viii) To the best of such Grantor's acknowledge,
none of the Trade Secrets of such Grantor has been used,
divulged, disclosed or appropriated to the detriment of such
Grantor for the benefit of any other Person other than such
Grantor and its Affiliates (as defined in the Credit
Agreement) and (B) no employee, independent contractor or
agent of such Grantor is in default or breach of any term of
any employment agreement, non-disclosure agreement, assignment
of inventions agreement or similar agreement or contract
relating in any way to the protection, ownership, development,
use or transfer of such Grantor's Intellectual Property
Collateral.
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Section 9. Further Assurances.
(a) Each Grantor agrees that from time to time, at the
expense of the each Grantor, each Grantor will promptly execute and
deliver all further instruments and documents, and take all further
action, that may be necessary or desirable, or that the Trustee, the
Administrative Agent or the Public Trustee may reasonably request, in
order to perfect and protect any pledge, assignment or security
interest granted or purported to be granted hereby or to enable the
Trustee to exercise and enforce its rights and remedies hereunder with
respect to any Collateral, including the filing of any Uniform
Commercial Code or fixture financing statements; provided, however,
that no Grantor shall be required to file or record any fixture
financing statement where such filing or recording would result in a
filing or recording tax or fee (other than nominal fees). Without
limiting the generality of the foregoing, each Grantor will: (i) if any
Collateral shall be evidenced by a promissory note or other instrument,
deliver and pledge to the Trustee hereunder such note or instrument
duly indorsed or accompanied by duly executed instruments of transfer
or assignment, all in form and substance satisfactory to the Trustee;
and (ii) execute and file such financing or continuation statements, or
amendments thereto, and such other instruments or notices, as may be
necessary or desirable, or as the Trustee may request, in order to
perfect and preserve the pledge, assignment and security interest
granted or purported to be granted hereby.
(b) Each Grantor hereby authorizes the Trustee to file
one or more financing or continuation statements, and amendments
thereto, relating to all or any part of the Collateral without the
signature of each Grantor where permitted by law. A photocopy or other
reproduction of this Agreement or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing
statement where permitted by law.
(c) Each Grantor will furnish to the Trustee from time to
time statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as
the Trustee may reasonably request, all in reasonable detail.
(d) Each Grantor shall provide the Trustee not less than
30 days' written notice prior to the effective date of the transfer of
such Grantor's jurisdiction of formation so that all action required by
this Section 9 shall have been taken prior thereto (and upon the taking
of such action in such jurisdiction, Schedule III shall be
automatically amended as appropriate).
Section 10. As to Equipment and Inventory. Each Grantor
will keep the Equipment and Inventory of such Grantor (other than Inventory sold
in the ordinary course of business) at the places therefor specified in Section
8(a) or, upon 30 days' prior written notice to the Trustee, at such other places
in a jurisdiction where all action required by Section 9 shall have been taken
with respect to such Equipment and Inventory (and, upon the taking of such
action in such jurisdiction, Schedule II hereto shall be automatically amended
to include such other places).
Section 11. Insurance.
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(a) Each Grantor will, at its own expense, maintain
insurance with respect to the Equipment and Inventory of such Grantor
in such amounts, against such risks, in such form and with such
insurers, as shall be required under the Indenture and the Credit
Agreement. Except during the continuance of an Actionable Default, each
policy of each Grantor for liability insurance and property damage
insurance shall provide for all losses to be paid on behalf of such
Grantor or to be paid directly to such Grantor, respectively. Each such
policy shall in addition (i) name such Grantor and the Trustee as
insured parties thereunder (without any representation or warranty by
or obligation upon the Trustee) as their interests may appear, (ii)
contain the agreement by the insurer that any loss thereunder shall be
payable to the Trustee notwithstanding any action, inaction or breach
of representation or warranty by such Grantor, (iii) provide that there
shall be no recourse against the Trustee for payment of premiums or
other amounts with respect thereto and (iv) provide that at least 10
days' prior written notice of cancellation or of lapse shall be given
to the Trustee by the insurer. Each Grantor will, if so requested by
the Trustee, deliver to the Trustee original or duplicate policies of
such insurance and, as often as the Trustee may reasonably request, a
report of a reputable insurance broker with respect to such insurance.
(b) Reimbursement under any liability insurance
maintained by any Grantor pursuant to this Section 11 may be paid
directly to the Person who shall have incurred liability covered by
such insurance. In case of any loss involving damage to Equipment or
Inventory when subsection (c) of this Section 11 is not applicable, the
applicable Grantor will make or cause to be made the necessary repairs
to or replacements of such Equipment or Inventory, and any proceeds of
insurance properly received by or released to such Grantor shall be
used by such Grantor, except as otherwise required hereunder or by the
Credit Agreement, to pay or as reimbursement for the costs of such
repairs or replacements.
(c) So long as no Actionable Default shall have occurred
and be continuing, all insurance payments received by the Trustee in
connection with any loss, damage or destruction of any Inventory or
Equipment will be released by the Trustee to the applicable Grantor and
to the extent required under the Credit Agreement or the Indenture,
such Grantor shall use such insurance payments for the repair,
replacement or restoration thereof. Upon the occurrence and during the
continuance of any Actionable Default, all insurance payments in
respect of such Equipment or Inventory shall be paid to the Trustee and
shall, in the Trustee's sole discretion, (i) be released to the
applicable Grantor to be applied as set forth in the first sentence of
this subsection (c) or (ii) be held as additional Collateral hereunder
or applied as specified in Section 17(b).
Section 12. Place of Perfection; Records; Collection of
Receivables.
(a) Each Grantor will keep its chief executive office,
the office where it keeps its records concerning the Collateral and
Related Contracts to which such Grantor is a party and all originals of
all chattel paper that evidence Receivables of such Grantor, at the
location therefor specified in Section 8(a) or, upon 30 days' prior
written notice to the Trustee, the Administrative Agent and the Public
Trustee at such other locations in a jurisdiction where all actions
required by Section 9 shall have been taken with respect to
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the Collateral of such Grantor (and, upon the taking of such action in
such jurisdiction, Schedule III hereto shall be automatically amended
to include such other location). Each Grantor will hold and preserve
its records relating to the Collateral, the Related Contracts and
chattel paper and will permit representatives of the Trustee, the
Administrative Agent and the Public Trustee at any time during normal
business hours to inspect and make abstracts from such records and
other documents.
(b) Except as otherwise provided in this subsection (b),
each Grantor will continue to collect, at its own expense, all amounts
due or to become due such Grantor under the Receivables and the Related
Contracts. In connection with such collections, such Grantor may take
(and, at the direction of the Trustee, the Administrative Agent or the
Public Trustee upon the occurrence and during the continuance of an
Actionable Default, will take) such action as such Grantor or the
Trustee may deem necessary or advisable to enforce collection of the
Receivables and the Related Contracts; provided, however, that the
Trustee shall have the right, upon the occurrence and during the
continuance of an Actionable Default and upon written notice to such
Grantor of its intention to do so, to notify the obligors under any
Receivables or Related Contracts of the assignment of such Receivables
or Related Contracts to the Trustee and to direct such obligors to make
payment of all amounts due or to become due to such Grantor thereunder
directly to the Trustee and, upon such notification and at the expense
of such Grantor, to enforce collection of any such Receivables or
Related Contracts, and to adjust, settle or compromise the amount or
payment thereof, in the same manner and to the same extent as such
Grantor might have done. After receipt by any Grantor of the notice
from the Trustee referred to in the proviso to the preceding sentence,
(i) all amounts and proceeds (including instruments) received by such
Grantor in respect of the Receivables and the Related Contracts of such
Grantor shall be received in trust for the benefit of the Trustee
hereunder, shall be segregated from other funds of such Grantor and
shall be forthwith paid over to the Trustee in the same form as so
received (with any necessary indorsement) to be deposited in the Trust
Account and either (A) released to such Grantor on such terms as
provided in the Trust Agreement so long as no Actionable Default shall
have occurred and be continuing or (B) if any Actionable Default shall
have occurred and be continuing, applied as provided in Section 17(b),
(ii) such Grantor will not adjust, settle or compromise the amount or
payment of any Receivable, release wholly or partly any obligor
thereof, or allow any credit or discount thereon and (iii) such Grantor
will not permit or consent to the subordination of its right to payment
under any of the Receivables or the Related Contracts to any other
indebtedness or obligations of the obligor thereof.
Section 13. As to Intellectual Property Collateral.
(a) With respect to each item of its Intellectual
Property Collateral, each Grantor agrees to take, at its expense, all
necessary steps, including, without limitation, in the U.S. Patent and
Trademark Office, the U.S. Copyright Office and any other governmental
authority, to (i) maintain the validity and enforceability of each such
item of Intellectual Property Collateral and maintain each such item of
Intellectual Property Collateral in full force and effect, and (ii)
pursue the registration and maintenance of each patent, trademark, or
copyright registration or application, now or hereafter included in
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the Intellectual Property Collateral of such Grantor, including,
without limitation, the payment of required fees and taxes, the filing
of responses to office actions issued by the U.S. Patent and Trademark
Office, the U.S. Copyright Office or other governmental authorities,
the filing of applications for renewal or extension, the filing of
affidavits under Sections 8 and 15 of the U.S. Trademark Act, the
filing of divisional, continuation, continuation-in-part, reissue and
renewal applications or extensions, the payment of maintenance fees and
the participation in interference, reexamination, opposition,
cancellation, infringement and misappropriation proceedings, except in
each case to the extent such Grantor has determined that such action is
not appropriate or cost effective in light of costs associated with
such action or the value of the related Intellectual Property
Collateral. No Grantor shall, without the written consent of the
Trustee, discontinue use of or otherwise abandon any Intellectual
Property Collateral, or abandon any right to file an application for
letters patent, trademark, or copyright, unless such Grantor shall have
previously determined that such use or the pursuit or maintenance of
such Intellectual Property Collateral is no longer desirable in the
conduct of such Grantor's business and that the loss thereof would not
be reasonably likely to have a Material Adverse Effect.
(b) Each Grantor shall take all steps which it or the
Trustee, Administrative Agent or Public Trustee deems reasonable and
appropriate under the circumstances and in the case of any of the
Trustee, Administrative Agent or Public Trustee, which it reasonably
requests to preserve and protect each item of its Intellectual Property
Collateral, including, without limitation, maintaining the quality of
any and all products or services used or provided in connection with
any of the Trademarks, consistent with the quality of the products and
services as of the date hereof, and taking all reasonable steps to
ensure that all licensed users of any of the Trademarks use such
consistent standards of quality.
(c) With respect to its Intellectual Property Collateral,
each Grantor agrees to execute an agreement, in substantially the form
set forth in Exhibit B hereto (an "INTELLECTUAL PROPERTY SECURITY
AGREEMENT"), for recording the security interest granted hereunder to
the Trustee in such Intellectual Property Collateral with the U.S.
Patent and Trademark Office, the U.S. Copyright Office and any other
governmental authorities necessary to perfect the security interest
hereunder in such Intellectual Property Collateral.
(d) Each Grantor agrees that, should it obtain an
ownership interest in any item of the type set forth in Section 1(g)
which is not on the date hereof a part of the Intellectual Property
Collateral consisting of United States registered patents, trademarks
and copyrights (the "AFTER-ACQUIRED INTELLECTUAL PROPERTY"), (i) the
provisions of Section 1 shall automatically apply thereto, (ii) any
such After-Acquired Intellectual Property and, in the case of
trademarks, the goodwill of the business connected therewith or
symbolized thereby, shall automatically become part of the Intellectual
Property Collateral subject to the terms and conditions of this
Agreement with respect thereto, (iii) such Grantor shall give written
notice to the Trustee in accordance herewith of any such After-Acquired
Intellectual Property within 30 days following the calendar quarter in
which such ownership interest was obtained and (iv) such Grantor shall
execute and deliver to the Trustee an IP Security Agreement Supplement
in substantially the form of
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Exhibit C hereto covering such After-Acquired Intellectual Property as
"Additional Collateral" thereunder and as defined therein, and shall
record such IP Security Agreement Supplement with the U.S. Patent and
Trademark Office, the U.S. Copyright Office and any other United States
Federal governmental authorities necessary to perfect the security
interest hereunder in such After-Acquired Intellectual Property.
Section 14. Voting Rights; Dividends; Etc.
(a) So long as no Actionable Default shall have occurred
and be continuing:
(i) each Grantor shall be entitled to exercise
any and all voting and other consensual rights pertaining to
the Security Collateral or any part thereof for any purpose
not inconsistent with the terms of this Agreement or the other
Debt Instruments.
(ii) each Grantor shall be entitled to receive
and retain any and all dividends, interest and other
distributions paid in respect of the Security Collateral;
provided, however, that any and all
(A) dividends, interest and other distributions
paid or payable other than in cash in respect of, and
instruments and other property received, receivable or
otherwise distributed in respect of, or in exchange for, any
Security Collateral,
(B) dividends and other distributions paid or
payable in cash in respect of any Security Collateral in
connection with a partial or total liquidation or dissolution,
and
(C) cash paid, payable or otherwise distributed
in exchange for any Security Collateral
shall be, and shall be forthwith delivered to the Trustee to hold as,
Security Collateral and shall, if received by each Grantor, be received
in trust for the benefit of the Trustee, be segregated from the other
property or funds of each Grantor and be forthwith delivered to the
Trustee as Security Collateral in the same form as so received (with
any necessary indorsement).
(iii) The Trustee shall execute and deliver (or
cause to be executed and delivered) to each Grantor all such
proxies and other instruments as each Grantor may reasonably
request for the purpose of enabling each Grantor to exercise
the voting and other rights that it is entitled to exercise
pursuant to paragraph (i) above and to receive the dividends
or interest payments that it is authorized to receive and
retain pursuant to paragraph (ii) above.
(b) Upon the occurrence and during the continuance of an
Actionable Default:
(i) All rights of each Grantor (x) to exercise
or refrain from exercising the voting and other consensual
rights that it would otherwise be entitled to exercise
pursuant to Section 14(a)(i) shall, upon notice to each
Grantor
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by the Trustee, cease and (y) to receive the dividends and
other distributions that it would otherwise be authorized to
receive and retain pursuant to Section 14(a)(ii) shall
automatically cease, and all such rights shall thereupon
become vested in the Trustee, which shall thereupon have the
sole right to exercise or refrain from exercising such voting
and other consensual rights and to receive and hold as
Security Collateral such dividends and other distributions.
(ii) All dividends and other distributions that
are received by each Grantor contrary to the provisions of
paragraph (i) of this Section 14(b) shall be received in trust
for the benefit of the Trustee, shall be segregated from other
funds of each Grantor and shall be forthwith paid over to the
Trustee as Security Collateral in the same form as so received
(with any necessary indorsement).
Section 15. Transfers and Other Liens; Additional
Shares.
(a) Each Grantor agrees that it will not (i) sell, assign
(by operation of law or otherwise) or otherwise dispose of, or grant
any option with respect to, any of the Collateral, other than sales,
assignments and other dispositions of Collateral, and options relating
to Collateral, permitted under the terms of the Debt Instruments, or
(ii) create or suffer to exist any Lien upon or with respect to any of
the Collateral of such Grantor except for the pledge, assignment and
security interest created under this Agreement and Permitted Liens (as
defined in the Credit Agreement).
(b) Each Grantor agrees that it will (i) cause each
issuer of the Pledged Shares pledged by such Grantor not to issue any
stock or other securities in addition to or in substitution for the
Pledged Shares issued by such issuer, except to such Grantor, and (ii)
pledge hereunder, immediately upon its acquisition (directly or
indirectly) thereof, any and all additional shares of stock or other
securities.
Section 16. Trustee May Perform.
If any Grantor fails to perform any agreement contained
herein, the Trustee may, as the Trustee deems necessary to protect the security
interest granted hereunder in the Collateral or to protect the value thereof,
but without any obligation to do so (and upon the occurrence and during the
continuation of an Actionable Default without notice), itself perform, or cause
performance of, such agreement, and the reasonable expenses of the Trustee
incurred in connection therewith shall be payable by such Grantor as provided in
the Trust Agreement.
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(a) The Trustee's Duties.
Without limiting the protections provided the Trustee under
Section 5 of the Trust Agreement (which are hereby incorporated herein by
reference), the powers conferred on the Trustee hereunder are solely to protect
its interest in the Collateral and shall not impose any duty upon 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 Trustee
shall have no duty as to any Collateral, as to ascertaining or taking action
with respect to calls, conversions, exchanges, maturities, tenders or other
matters relative to any Collateral, whether or not any Secured Party has or is
deemed to have knowledge of such matters, or as to the taking of any necessary
steps to preserve rights against any parties or any other rights pertaining to
any Collateral. The Trustee shall be deemed to have exercised reasonable care in
the custody and preservation of any Collateral in its possession if such
Collateral is accorded treatment substantially equal to that which it accords
its own property.
Section 17. Remedies.
If any Actionable Default shall have occurred and be
continuing:
(a) The Trustee may exercise in respect of the
Collateral, in addition to other rights and remedies provided for
herein or otherwise available to it, all the rights and remedies of a
secured party upon default under the N.Y. Uniform Commercial Code
(whether or not the N.Y. Uniform Commercial Code applies to the
affected Collateral) and also may (i) require each Grantor to, and each
Grantor hereby agrees that it will at its expense and upon request of
the Trustee forthwith, assemble all or part of the Collateral as
directed by the Trustee and make it available to the Trustee at a place
to be designated by the Trustee that is reasonably convenient to both
parties, (ii) without notice except as specified below, sell the
Collateral or any part thereof in one or more parcels at public or
private sale, at any of the Trustee's offices or elsewhere, for cash,
on credit or for future delivery, and upon such other terms as the
Trustee may deem commercially reasonable, (iii) occupy any premises
owned or leased by any of the Grantors where the Collateral or any part
thereof is assembled or located for a reasonable period in order to
effectuate its rights and remedies hereunder or under law, without
obligation to such Grantor in respect of such occupation; and (iv)
exercise any and all rights and remedies of any of the Grantors under
or in connection with the Agreements, the Receivables and the Related
Contracts or otherwise in respect of the Collateral, including, without
limitation, any and all rights of such Grantor to demand or otherwise
require payment of any amount under, or performance of any provision
of, the Agreements, the Receivables and the Related Contracts. Each
Grantor agrees that, to the extent notice of sale shall be required by
law, at least ten days' notice to each Grantor of the time and place of
any public sale or of the time after which any private sale is to be
made shall constitute reasonable notification. The Trustee shall not be
obligated to make any sale of Collateral regardless of notice of sale
having been given. The Trustee may adjourn any public or private sale
from time to time by announcement at the time and place fixed therefor,
and such sale may, without further notice, be made at the time and
place to which it was so adjourned.
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(b) All cash proceeds received by the Trustee in respect
of any sale of, collection from, or other realization upon all or any
part of the Collateral shall be deposited into the Trust Account and
may, in the discretion of the Trustee, be held by the Trustee as
collateral for, and/or then or at any time thereafter applied in whole
or in part by the Trustee against the Secured Obligations as provided
in Section 3.4 of the Trust Agreement.
(c) The Trustee may exercise any and all rights and
remedies of each Grantor in respect of the Collateral.
(d) All payments received by each Grantor in respect of
the Collateral shall be received in trust for the benefit of the
Trustee, shall be segregated from other funds of each Grantor and shall
be forthwith paid over to the Trustee in the same form as so received
(with any necessary indorsement).
(e) The Trustee may, without notice to each Grantor
except as required by law and at any time or from time to time, charge,
set-off and otherwise apply all or any part of the Secured Obligations
against the Trust Account, the L/C Cash Collateral Account or any part
thereof.
Section 18. Registration Rights.
If the Trustee shall determine to exercise its right to sell
all or any of the Security Collateral pursuant to Section 17, the Company agrees
that, upon request of the Trustee, the Company will, at its own expense:
(a) execute and deliver, and cause Caremark, Inc. and the
directors and officers of such issuer to execute and deliver, all such
instruments and documents, and do or cause to be done all such other
acts and things, as may be necessary or, in the opinion of the Trustee,
advisable to register the shares thereof pledged hereunder under the
provisions of the Securities Act of 1933, as from time to time amended
(the "SECURITIES ACT"), to cause the registration statement relating
thereto to become effective and to remain effective for such period as
prospectuses are required by law to be furnished and to make all
amendments and supplements thereto and to the related prospectus that,
in the opinion of the Trustee, are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules
and regulations of the Securities and Exchange Commission applicable
thereto;
(b) use its best efforts to qualify such shares under the
state securities or "Blue Sky" laws and to obtain all necessary
governmental approvals for the sale of such shares, as requested by the
Trustee;
(c) cause such issuer to make available, as soon as
practicable, an earnings statement that will satisfy the provisions of
Section 11(a) of the Securities Act;
(d) provide the Trustee with such other information and
projections as may be necessary or, in the opinion of the Trustee,
advisable to enable the Trustee to effect the sale of such shares; and
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(e) do or cause to be done all such other acts and things
as may be necessary to make such sale of such shares or any part
thereof valid and binding and in compliance with applicable law.
The Trustee is authorized, in connection with any sale of such
shares pursuant to Section 17, to deliver or otherwise disclose to any
prospective purchaser of such shares (i) any registration statement or
prospectus, and all supplements and amendments thereto, prepared pursuant to
clause (a) above, (ii) any information and projections provided to it pursuant
to clause (d) above and (iii) any other information in its possession relating
to such shares.
Section 19. Amendments; Waivers; Additional Grantors;
Etc.
(a) No amendment or waiver of any provision of this
Agreement, and no consent to any departure by any Grantor herefrom,
shall in any event be effective unless the same shall be in writing and
signed by the Trustee with the written consent of the Administrative
Agent and the Public Trustee, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose
for which given. No failure on the part of the Trustee or any other
Secured Party to exercise, and no delay in exercising any right
hereunder, shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right.
(b) Upon the execution and delivery by any Person of a
security agreement supplement in substantially the form of Exhibit A
hereto (each a "SECURITY AGREEMENT SUPPLEMENT"), (i) such Person shall
be referred to as an "Additional GRANTOR" and shall be and become a
Grantor hereunder and each reference in this Agreement to "Grantor"
shall also mean and be a reference to such Additional Grantor, and (ii)
the supplemental schedules I, II, III, and IV attached to each Security
Agreement Supplement shall be incorporated into and become a part of
and supplement Schedules I, II, III, and IV, respectively, hereto, and
the Trustee may attach such supplemental schedules to such Schedules;
and each reference to such Schedules shall mean and be a reference to
such Schedules as supplemented pursuant to each Security Agreement
Supplement.
Section 20. Notices; Etc.
All notices and other communications provided for hereunder
shall be in writing (including telecopier communication) and mailed, telecopied,
or delivered to, in the case of a Grantor or the Trustee, addressed to it at its
address specified in the Trust Agreement and, in the case of each Additional
Grantor, addressed to it at its address set forth opposite such Additional
Grantor's name on the signature page to the Security Agreement Supplement
pursuant to which it became a party hereto; or, as to any party, at such other
address as shall be designated by such party in a written notice to the other
parties. All such notices and other communications shall, when mailed or
telecopied, be effective when deposited in the mails or telecopied,
respectively, addressed as aforesaid; provided, however, that any notices and
other communications to the Trustee shall not be effective until received by the
Trustee. Delivery by telecopier of an executed counterpart of any amendment or
waiver of any provision of this Agreement or of any
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Security Agreement Supplement or Schedule hereto shall be effective as delivery
of an original executed counterpart thereof.
Section 21. Continuing Security Interest.
This Agreement shall create a continuing security interest in
the Collateral and shall (a) remain in full force and effect until the release
of all Collateral as provided in Section 6.1 of the Trust Agreement, (b) be
binding upon each Grantor, its successors and assigns and (c) inure, together
with the rights and remedies of the Trustee hereunder, to the benefit of the
Trustee, the Secured Parties and their respective successors, transferees and
assigns.
Section 22. Execution in Counterparts.
This Agreement may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of a signature page to this Agreement by telecopier shall
be effective as delivery of an original executed counterpart of this Agreement.
Section 23. Governing Law.
This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, each Grantor has caused this Agreement to
be duly executed and delivered by its officer thereunto duly authorized as of
the date first above written.
CAREMARK RX, INC.
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Title: SVP & Treasurer
Address for Notices: CAREMARK INTERNATIONAL INC.
-------------------
0000 Xxxxxxxx Xxxxx
Xxxxx 0000 By: /s/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
Xxxxxxxxxx, XX 00000 Title: VP
Telecopier No. (000) 000-0000
Attention: Xxxxx X. Xxxxxxx XX
CAREMARK INC.
By: /s/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
Title: VP
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