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Exhibit 10.2
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Security Agreement") is entered into as
of May 26, 1998 among STEEL HEDDLE MFG. CO., a Pennsylvania corporation (the
"Borrower"), certain Subsidiaries of the Borrower (individually a "Guarantor"
and collectively the "Guarantors"; together with the Borrower, individually an
"Obligor", and collectively the "Obligors"), and NATIONSBANK, N.A., in its
capacity as agent (in such capacity, the "Agent") for the lenders from time to
time party to the Credit Agreement described below (the "Lenders").
RECITALS
WHEREAS, pursuant to that certain Credit Agreement, dated as of the
date hereof (as amended, modified, extended, renewed or replaced from time to
time, the "Credit Agreement"), among the Borrower, the Guarantors, the Lenders,
the Agent and DLJ Capital Funding, Inc. as Syndication Agent, the Lenders have
agreed to make Loans and issue Letters of Credit upon the terms and subject to
the conditions set forth therein; and
WHEREAS, it is a condition precedent to the effectiveness of the
Credit Agreement and the obligations of the Lenders to make their respective
Loans and to issue Letters of Credit under the Credit Agreement that the
Obligors shall have executed and delivered this Security Agreement to the Agent
for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Definitions.
(a) Unless otherwise defined herein, capitalized terms
used herein shall have the meanings ascribed to such terms in the
Credit Agreement, and the following terms which are defined in the
Uniform Commercial Code in effect in the State of New York on the date
hereof are used herein as so defined: Accounts, Chattel Paper,
Deposit Accounts, Documents, Equipment, Farm Products, Fixtures,
General Intangibles, Instruments, Inventory, Investment Property and
Proceeds. For purposes of this Security Agreement, the term "Lender"
shall include any Affiliate of any Lender to which Hedging Obligations
are owed by an Obligor.
(b) In addition, the following terms shall have the
following meanings:
"Copyright Licenses": any written agreement, naming any
Obligor as licensor, granting any right under any Copyright including,
without limitation, any thereof referred to in Schedule 1(b) hereto.
"Copyrights": (a) all registered United States copyrights in
all Works, now existing or hereafter created or acquired, all
registrations and recordings thereof, and all applications in
connection therewith, including, without limitation, registrations,
recordings and
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applications in the United States Copyright office including, without
limitation, any thereof referred to in Schedule 1(b) hereto, and (b)
all renewals thereof including, without limitation, any thereof
referred to in Schedule 1(b) hereto.
"Patent License": all agreements, whether written or oral,
providing for the grant by or to an Obligor of any right to
manufacture, use or sell any invention covered by a Patent, including,
without limitation, any thereof referred to in Schedule 1(b) hereto.
"Patents": (a) all letters patent of the United States or any
other country and all reissues and extensions thereof, including,
without limitation, any thereof referred to in Schedule 1(b) hereto,
and (b) all applications for letters patent of the United States or
any other country and all divisions, continuations and continuations
in-part thereof, including, without limitation, any thereof referred
to in Schedule 1(b) hereto.
"Secured Obligations": the collective reference to all of the
Credit Party Obligations, now existing or hereafter arising pursuant
to the Credit Documents, owing from the Borrower or any other Credit
Party to any Lender or the Agent, howsoever evidenced, created,
incurred or acquired, whether primary, secondary, direct, contingent,
or joint and several, including, without limitation, all liabilities
arising under Hedging Agreements and all obligations and liabilities
incurred in connection with collecting and enforcing the foregoing.
"Trademark License": means any agreement, written or oral,
providing for the grant by or to an Obligor of any right to use any
Trademark, including, without limitation, any thereof referred to in
Schedule 1(b) hereto.
"Trademarks": (a) all trademarks, trade names, corporate
names, company names, business names, fictitious business names, trade
styles, service marks, logos and other source or business identifiers,
and the goodwill associated therewith, now existing or hereafter
adopted or acquired, all registrations and recordings thereof, and all
applications in connection therewith, whether in the United States
Patent and Trademark Office or in any similar office or agency of the
United States, any State thereof or any other country or any political
subdivision thereof, or otherwise, including, without limitation, any
thereof referred to in Schedule 1(b) hereto, and (b) all renewals
thereof.
"Work": any work which is subject to copyright protection
pursuant to Title 17 of the United States Code.
2. Grant of Security Interest in the Collateral. To secure the
prompt payment and performance in full when due, whether by lapse of time,
acceleration or otherwise, of the Secured Obligations, each Obligor hereby
grants to the Agent, for the benefit of the Lenders, a continuing security
interest in, and a right to set off against, any and all right, title and
interest of such Obligor in and to the following, whether now owned or existing
or owned, acquired, or arising hereafter (collectively, the "Collateral"):
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(a) all Accounts;
(b) all Chattel Paper;
(c) all Copyrights;
(d) all Copyright Licenses;
(e) all Deposit Accounts;
(f) all Documents;
(g) all Equipment;
(h) all Fixtures;
(i) all General Intangibles;
(j) all Instruments, including, without
limitation, the Intercompany Notes;
(k) all Inventory;
(l) all Investment Property (other than
in respect of Foreign Subidiaries);
(m) all Patents;
(n) all Patent Licenses;
(o) all Trademarks;
(p) all Trademark Licenses;
(q) all books, records, ledger cards, files,
correspondence, computer programs, tapes, disks, and related data
processing software (owned by such Obligor or in which it has an
interest) that at any time evidence or contain information relating to
any Collateral or are otherwise necessary or helpful in the collection
thereof or realization thereupon; and
(r) to the extent not otherwise included, all Proceeds
and products of any and all of the foregoing.
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The Obligors and the Agent, on behalf of the Lenders, hereby
acknowledge and agree that the security interest created hereby in the
Collateral (i) constitutes continuing collateral security for all of the
Secured Obligations, whether now existing or hereafter arising and (ii) is not
to be construed as an assignment of any Copyrights, Copyright Licenses,
Patents, Patent Licenses, Trademarks or Trademark Licenses. Moreover, the
Collateral shall not include any licenses or leases to the extent (but only to
the extent and only for so long as) such licenses and leases contain legally
enforceable restrictions on the granting of a security interest therein.
3. Provisions Relating to Accounts.
(a) Anything herein to the contrary notwithstanding, each
of the Obligors shall remain liable under each of the Accounts to
observe and perform all the conditions and obligations to be observed
and performed by it thereunder, all in accordance with the terms of
any agreement giving rise to each such Account. Neither the Agent nor
any Lender shall have any obligation or liability under any Account
(or any agreement giving rise thereto) by reason of or arising out of
this Security Agreement or the receipt by the Agent or any Lender of
any payment relating to such Account pursuant hereto, nor shall the
Agent or any Lender be obligated in any manner to perform any of the
obligations of an Obligor under or pursuant to any Account (or any
agreement giving rise thereto), to make any payment, to make any
inquiry as to the nature or the sufficiency of any payment received by
it or as to the sufficiency of any performance by any party under any
Account (or any agreement giving rise thereto), to present or file any
claim, to take any action to enforce any performance or to collect the
payment of any amounts which may have been assigned to it or to which
it may be entitled at any time or times.
(b) Once during each calendar year or at any time after
the occurrence and during the continuation of an Event of Default, the
Agent shall have the right, but not the obligation, to make test
verifications of the Accounts in any manner and through any medium
that it reasonably considers advisable, and the Obligors shall furnish
all such assistance and information as the Agent may require in
connection with such test verifications. At any time and from time to
time, upon the Agent's request and at the expense of the Obligors, the
Obligors shall cause independent public accountants or others
satisfactory to the Agent to furnish to the Agent reports showing
reconciliations, aging and test verifications of, and trial balances
for, the Accounts. The Agent in its own name or in the name of others
may communicate with account debtors on the Accounts to verify with
them to the Agent's satisfaction the existence, amount and terms of
any Accounts.
4. Representations and Warranties. Each Obligor hereby represents
and warrants to the Agent, for the benefit of the Lenders, that so long as any
of the Secured Obligations remain outstanding (other than any such obligations
which by the terms thereof are stated to survive termination of the Credit
Documents) or any Credit Document is in effect or any Letter of Credit shall
remain outstanding, and until all of the Commitments shall have been
terminated:
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(a) Chief Executive Office; Books & Records. Each
Obligor's chief executive office and chief place of business is (and
for the prior four months have been) located at the locations set
forth on Schedule 4(a) hereto, and each Obligor keeps its books and
records at such locations.
(b) Location of Collateral. The location of all
Collateral owned by each Obligor is as shown on Schedule 4(b) hereto.
(c) Ownership. Each Obligor is the legal and beneficial
owner of the Collateral which it purports to own and has a valid right
to use all of its other Collateral. Each Obligor has the right to
pledge, sell, assign or transfer its Collateral. Each Obligor's legal
name is as shown in this Security Agreement and no Obligor has in the
past four months changed its name, been party to a merger,
consolidation or other change in structure or used any tradename
except as set forth in Schedule 4(c) attached hereto.
(d) Security Interest/Priority. This Security Agreement
creates a valid security interest in favor of the Agent, for the
benefit of the Lenders, in the Collateral of such Obligor and, when
properly perfected by filing, shall constitute a valid perfected
security interest in such Collateral, to the extent such security can
be perfected by filing under the UCC, free and clear of all Liens
except for Permitted Liens.
(e) Farm Products. None of the Collateral constitutes,
or is the Proceeds of, Farm Products.
(f) Accounts. (i) Each Account of the Obligors and the
papers and documents relating thereto are genuine and in all material
respects what they purport to be, (ii) each Account arises out of (A)
a bona fide sale of goods sold and delivered by such Obligor (or is in
the process of being delivered) or (B) services theretofore actually
rendered by such Obligor to, the account debtor named therein, (iii)
no Account of an Obligor is evidenced by any Instrument or Chattel
Paper unless such Instrument or Chattel Paper has been theretofore
endorsed over and delivered to the Agent and (iv) no surety bond was
required or given in connection with any Account of an Obligor or the
contracts or purchase orders out of which they arose.
(g) Inventory. No Inventory is held by an Obligor
pursuant to consignment, sale or return, sale on approval or similar
arrangement.
(h) Copyrights, Patents and Trademarks.
(i) Schedule 1(b) hereto includes all
Copyrights, Copyright Licenses, Patents, Patent Licenses,
Trademarks and Trademark Licenses owned by the Obligors in
their own names as of the date hereof.
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(ii) To the best of each Obligor's
knowledge, each Copyright, Patent and Trademark of such
Obligor is valid, subsisting, unexpired, enforceable and has
not been abandoned.
(iii) Except as set forth in Schedule 1(b)
hereto, none of such Copyrights, Patents and Trademarks is the
subject of any licensing or franchise agreement.
(iv) Except as could not reasonably be
expected to have a Material Adverse Effect, no holding,
decision or judgment has been rendered by any Governmental
Authority which would limit, cancel or question the validity
of any Copyright, Patent or Trademark.
(v) Except as could not reasonably be
expected to have a Material Adverse Effect, no action or
proceeding is pending seeking to limit, cancel or question the
validity of any Copyright, Patent or Trademark, or which, if
adversely determined, would have a Material Adverse Effect on
the value of any Copyright, Patent or Trademark.
(vi) All applications pertaining to the
Copyrights, Patents and Trademarks of each Obligor have been
duly and properly filed, and all registrations or letters
pertaining to such Copyrights, Patents and Trademarks have
been duly and properly filed and issued, and all of such
Copyrights, Patents and Trademarks are valid and enforceable,
except as could not reasonably be expected to have a Material
Adverse Effect.
(vii) Except for licenses to third parties
in the ordinary course of business, no Obligor has made any
assignment or agreement in conflict with the security interest
in the Copyrights, Patents or Trademarks of each Obligor
hereunder.
5. Covenants. Each Obligor covenants that, so long as any of the
Secured Obligations remain outstanding (other than any such obligations which
by the terms thereof are stated to survive termination of the Credit Documents)
or any Credit Document is in effect or any Letter of Credit shall remain
outstanding, and until all of the Commitments shall have been terminated, such
Obligor shall:
(a) Other Liens. Defend the Collateral against the
claims and demands of all other parties claiming an interest therein,
keep the Collateral free from all Liens, except for Permitted Liens,
and not sell, exchange, transfer, assign, lease or otherwise dispose
of the Collateral or any interest therein, except as permitted under
the Credit Agreement.
(b) Preservation of Collateral. Keep the Collateral in
good order, condition and repair and not use the Collateral in
violation of the provisions of this Security Agreement or
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any other agreement relating to the Collateral or any policy insuring
the Collateral or any applicable statute, law, bylaw, rule, regulation
or ordinance.
(c) Instruments/Chattel Paper. If any amount payable
under or in connection with any of the Collateral shall be or become
evidenced by any Instrument or Chattel Paper, immediately deliver such
Instrument or Chattel Paper to the Agent, duly indorsed in a manner
satisfactory to the Agent, to be held as Collateral pursuant to this
Security Agreement.
(d) Change in Location. Not, without providing 30 days
prior written notice to the Agent and without filing such amendments
to any previously filed financing statements as the Agent may require,
(a) change the location of its chief executive office and chief place
of business (as well as its books and records) from the locations set
forth on Schedule 4(a) hereto, (b) change the location of its
Collateral from the locations set forth for such Obligor on Schedule
4(b) hereto, or (c) change its name, be party to a merger,
consolidation or other change in structure or use any tradename other
than as set forth on Schedule 4(c) attached hereto.
(e) Inspection. Allow the Agent or its representatives
to visit and inspect the Collateral as set forth in Section 7.11 of
the Credit Agreement.
(f) Perfection of Security Interest. Execute and deliver
to the Agent such agreements, assignments or instruments (including
affidavits, notices, reaffirmations and amendments and restatements of
existing documents, as the Agent may reasonably request) and do all
such other things as the Agent may reasonably deem necessary or
appropriate (i) to assure to the Agent its security interests
hereunder, including (A) such financing statements (including renewal
statements) or amendments thereof or supplements thereto or other
instruments as the Agent may from time to time reasonably request in
order to perfect and maintain the security interests granted hereunder
in accordance with the UCC, (B) with regard to Copyrights, a Notice of
Grant of Security Interest in Copyrights in the form of Schedule
5(f)(i), (C) with regard to Patents, a Notice of Grant of Security
Interest in Patents for filing with the United States Patent and
Trademark Office in the form of Schedule 5(f)(ii) attached hereto and
(D) with regard to Trademarks, a Notice of Grant of Security Interest
in Trademarks for filing with the United States Patent and Trademark
Office in the form of Schedule 5(f)(iii) attached hereto, (ii) to
consummate the transactions contemplated hereby and (iii) to otherwise
protect and assure the Agent of its rights and interests hereunder.
To that end, each Obligor agrees that the Agent may file one or more
financing statements disclosing the Agent's security interest in any
or all of the Collateral of such Obligor without, to the extent
permitted by law, such Obligor's signature thereon, and further each
Obligor also hereby irrevocably makes, constitutes and appoints the
Agent, its nominee or any other person whom the Agent may designate,
as such Obligor's attorney in fact with full power and for the limited
purpose to sign in the name of such Obligor any such financing
statements, or amendments and supplements to financing statements,
renewal financing statements, notices or any similar documents which
in the Agent's reasonable discretion would be necessary,
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appropriate or convenient in order to perfect and maintain perfection
of the security interests granted hereunder, such power, being coupled
with an interest, being and remaining irrevocable so long as the
Credit Agreement is in effect or any amounts payable thereunder or
under any other Credit Document, any Letter of Credit shall remain
outstanding, and until all of the Commitments thereunder shall have
terminated. Each Obligor hereby agrees that a carbon, photographic or
other reproduction of this Security Agreement or any such financing
statement is sufficient for filing as a financing statement by the
Agent without notice thereof to such Obligor wherever the Agent may in
its sole discretion desire to file the same. In the event for any
reason the law of any jurisdiction other than New York becomes or is
applicable to the Collateral of any Obligor or any part thereof, or to
any of the Secured Obligations, such Obligor agrees to execute and
deliver all such instruments and to do all such other things as the
Agent in its sole discretion reasonably deems necessary or appropriate
to preserve, protect and enforce the security interests of the Agent
under the law of such other jurisdiction (and, if an Obligor shall
fail to do so promptly upon the request of the Agent, then the Agent
may execute any and all such requested documents on behalf of such
Obligor pursuant to the power of attorney granted hereinabove). If
any Collateral is in the possession or control of an Obligor's agents
and the Agent so requests, such Obligor agrees to notify such agents
in writing of the Agent's security interest therein and, upon the
Agent's request, instruct them to hold all such Collateral for the
Lenders' account and subject to the Agent's instructions. Each
Obligor agrees to xxxx its books and records to reflect the security
interest of the Agent in the Collateral.
(g) Treatment of Accounts. Not grant or extend the time
for payment of any Account, or compromise or settle any Account for
less than the full amount thereof, or release any person or property,
in whole or in part, from payment thereof, or allow any credit or
discount thereon, other than as normal and customary in the ordinary
course of an Obligor's business.
(h) Covenants Relating to Copyrights.
(i) With respect to each material
Copyright, employ such Copyright for each Work with such
notice of copyright as may be required by law to secure
copyright protection.
(ii) Not do any act or knowingly omit to
do any act whereby any material Copyright may become
invalidated and (A) not do any act, or knowingly omit to do
any act, whereby any material Copyright may become injected
into the public domain; (B) notify the Agent immediately if it
knows, or has reason to know, that any material Copyright may
become injected into the public domain or of any adverse
determination or development (including, without limitation,
the institution of, or any such determination or development
in, any court or tribunal in the United States or any other
country) regarding an Obligor's ownership of any such
Copyright or its validity; (C) take all necessary steps as it
shall deem appropriate under the
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circumstances, to maintain and pursue each application (and to
obtain the relevant registration) and to maintain each
registration of each material Copyright owned by an Obligor
including, without limitation, filing of applications for
renewal where necessary; and (D) promptly notify the Agent of
any material infringement of any material Copyright of an
Obligor of which it becomes aware and take such actions as it
shall reasonably deem appropriate under the circumstances to
protect such Copyright, including, where appropriate, the
bringing of suit for infringement, seeking injunctive relief
and seeking to recover any and all damages for such
infringement.
(iii) Not make any assignment or agreement
in conflict with the security interest in the Copyrights of
each Obligor hereunder other than in the ordinary course of
business.
(i) Covenants Relating to Patents and Trademarks.
(i) (A) Continue to use each material
Trademark on each and every trademark class of goods
applicable to its current line as reflected in its current
catalogs, brochures and price lists in order to maintain such
Trademark in full force free from any claim of abandonment for
non-use, (B) maintain as in the past the quality of products
and services offered under such Trademark, (C) employ such
Trademark with the appropriate notice of registration, (D) not
adopt or use any xxxx which is confusingly similar or a
colorable imitation of such Trademark unless the Agent, for
the ratable benefit of the Lenders, shall obtain a perfected
security interest in such xxxx pursuant to this Security
Agreement, and (E) not (and not permit any licensee or
sublicensee thereof to) do any act or knowingly omit to do any
act whereby any Trademark may become invalidated.
(ii) Not do any act, or omit to do any
act, whereby any material Patent may become abandoned or
dedicated.
(iii) Notify the Agent and the Lenders
promptly if it knows, or has reason to know, that any
application or registration relating to any material Patent or
material Trademark may become abandoned or dedicated, or of
any adverse determination or development (including, without
limitation, the institution of, or any such determination or
development in, any proceeding in the United States Patent and
Trademark Office or any court or tribunal in any country)
regarding an Obligor's ownership of any such Patent or
Trademark or its right to register the same or to keep and
maintain the same.
(iv) Whenever an Obligor, either by
itself or through an agent, employee, licensee or designee,
shall file an application for the registration of any Patent
or Trademark with the United States Patent and Trademark
Office or any similar office or agency in any other country or
any political subdivision thereof, an
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Obligor shall report such filing to the Agent and the Lenders
within five Business Days after the last day of the fiscal
quarter in which such filing occurs. Upon request of the
Agent, an Obligor shall execute and deliver any and all
agreements, instruments, documents and papers as the Agent may
request to evidence the Agent's and the Lenders' security
interest in any Patent or Trademark and the goodwill and
general intangibles of an Obligor relating thereto or
represented thereby.
(v) Take all reasonable and necessary
steps, including, without limitation, in any proceeding before
the United States Patent and Trademark Office, or any similar
office or agency in any other country or any political
subdivision thereof, to maintain and pursue each material
application (and to obtain the relevant registration) and to
maintain each registration of the material Patents and
Trademarks, including, without limitation, filing of
applications for renewal, affidavits of use and affidavits of
incontestability.
(vi) Promptly notify the Agent and the
Lenders after it learns that any material Patent or material
Trademark included in the Collateral is infringed,
misappropriated or diluted by a third party and promptly xxx
for infringement, misappropriation or dilution, to seek
injunctive relief where appropriate and to recover any and all
damages for such infringement, misappropriation or dilution,
or take such other actions as it shall reasonably deem
appropriate under the circumstances to protect such Patent or
Trademark.
(vii) Except for licenses to third parties
in the ordinary course of business, not make any assignment or
agreement in conflict with the security interest in the
Patents or Trademarks of each Obligor hereunder.
(j) New Patents, Copyrights and Trademarks. Promptly
provide the Agent with (i) a listing of all applications, if any, for
new Copyrights, Patents or Trademarks (together with a listing of the
issuance of registrations or letters on present applications), which
new applications and issued registrations or letters shall be subject
to the terms and conditions hereunder, and (ii) (A) with respect to
Copyrights, a duly executed Notice of Security Interest in Copyrights,
(B) with respect to Patents, a duly executed Notice of Security
Interest in Patents, (C) with respect to Trademarks, a duly executed
Notice of Security Interest in Trademarks or (D) such other duly
executed documents as the Agent may request in a form acceptable to
counsel for the Agent and suitable for recording to evidence the
security interest in the Copyright, Patent or Trademark which is the
subject of such new application.
(k) Insurance. Insure the Collateral of such Obligor as
set forth in Section 7.6 of the Credit Agreement. All insurance
proceeds shall be subject to the security interest of the Agent
hereunder.
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6. Advances by Lenders. On failure of any Obligor to perform any
of the covenants and agreements contained herein, the Agent may, at its sole
option and in its sole discretion, perform the same and in so doing may expend
such sums as the Agent may reasonably deem advisable in the performance
thereof, including, without limitation, the payment of any insurance premiums,
the payment of any taxes, a payment to obtain a release of a Lien or potential
Lien, expenditures made in defending against any adverse claim and all other
expenditures which the Agent or the Lenders may make for the protection of the
security hereof or which may be compelled to make by operation of law. All
such sums and amounts so expended shall be repayable by the Obligors on a joint
and several basis promptly upon timely notice thereof and demand therefor,
shall constitute additional Secured Obligations and shall bear interest from
the date said amounts are expended at the default rate specified in Section
3.1(b) of the Credit Agreement for Revolving Loans that are Base Rate Loans.
No such performance of any covenant or agreement by the Agent or the Lenders on
behalf of any Obligor, and no such advance or expenditure therefor, shall
relieve the Obligors of any default under the terms of this Security Agreement
or the other Credit Documents. The Lenders may make any payment hereby
authorized in accordance with any xxxx, statement or estimate procured from the
appropriate public office or holder of the claim to be discharged without
inquiry into the accuracy of such xxxx, statement or estimate or into the
validity of any tax assessment, sale, forfeiture, tax lien, title or claim
except to the extent such payment is being contested in good faith by an
Obligor in appropriate proceedings and against which adequate reserves are
being maintained in accordance with GAAP.
7. Events of Default.
The occurrence of an event (including the expiration of any grace or
cure period applicable thereto) which under the Credit Agreement would
constitute an Event of Default shall be an Event of Default hereunder (an
"Event of Default").
8. Remedies.
(a) General Remedies. Upon the occurrence of an Event of
Default and during continuation thereof, the Lenders shall have, in
addition to the rights and remedies provided herein, in the Credit
Documents or by law (including, but not limited to, the rights and
remedies set forth in the Uniform Commercial Code of the jurisdiction
applicable to the affected Collateral), the rights and remedies of a
secured party under the UCC (regardless of whether the UCC is the law
of the jurisdiction where the rights and remedies are asserted and
regardless of whether the UCC applies to the affected Collateral), and
further, the Agent may, with or without judicial process or the aid
and assistance of others, (i) enter on any premises on which any of
the Collateral may be located and, without resistance or interference
by the Obligors, take possession of the Collateral, (ii) dispose of
any Collateral on any such premises, (iii) require the Obligors to
assemble and make available to the Agent at the expense of the
Obligors any Collateral at any place and time designated by the Agent
which is reasonably convenient to both parties, (iv) remove any
Collateral from any such premises for the purpose of effecting sale OR
other disposition thereof, and/or (v) without demand and
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without advertisement, notice, hearing or process of law, all of which
each of the Obligors hereby waives to the fullest extent permitted by
law, at any place and time or times, sell and deliver any or all
Collateral held by or for it at public or private sale, by one or more
contracts, in one or more parcels, for cash, upon credit or otherwise,
at such prices and upon such terms as the Agent deems advisable, in
its sole discretion (subject to any and all mandatory legal
requirements). In addition to all other sums due the Agent and the
Lenders with respect to the Secured Obligations, the Obligors shall
pay the Agent and each of the Lenders all reasonable documented costs
and expenses incurred by the Agent or any such Lender, including, but
not limited to, reasonable attorneys' fees and court costs, in
obtaining or liquidating the Collateral, in enforcing payment of the
Secured Obligations, or in the prosecution or defense of any action or
proceeding by or against the Agent or the Lenders or the Obligors
concerning any matter arising out of or connected with this Security
Agreement, any Collateral or the Secured Obligations, including,
without limitation, any of the foregoing arising in, arising under or
related to a case under the Bankruptcy Code. To the extent the rights
of notice cannot be legally waived hereunder, each Obligor agrees that
any requirement of reasonable notice shall be met if such notice is
personally served on or mailed, postage prepaid, to the Borrower in
accordance with the notice provisions of Section 11.1 of the Credit
Agreement at least 10 days before the time of sale or other event
giving rise to the requirement of such notice. The Agent and the
Lenders shall not be obligated to make any sale or other disposition
of the Collateral regardless of notice having been given. To the
extent permitted by law, any Lender may be a purchaser at any such
sale. To the extent permitted by applicable law, each of the Obligors
hereby waives all of its rights of redemption with respect to any such
sale. Subject to the provisions of applicable law, the Agent and the
Lenders may postpone or cause the postponement of the sale of all or
any portion of the Collateral by announcement at the time and place of
such sale, and such sale may, without further notice, to the extent
permitted by law, be made at the time and place to which the sale was
postponed, or the Agent and the Lenders may further postpone such sale
by announcement made at such time and place.
(b) Remedies relating to Accounts. Upon the occurrence
of an Event of Default and during the continuation thereof, whether or
not the Agent has exercised any or all of its rights and remedies
hereunder, each Obligor will promptly upon request of the Agent
instruct all account debtors to remit all payments in respect of
Accounts to a mailing location selected by the Agent. In addition,
the Agent or its designee may notify any Obligor's customers and
account debtors that the Accounts of such Obligor have been assigned
to the Agent or of the Agent's security interest therein, and may
(either in its own name or in the name of an Obligor or both) demand,
collect (including without limitation by way of a lockbox
arrangement), receive, take receipt for, sell, xxx for, compound,
settle, compromise and give acquittance for any and all amounts due or
to become due on any Account, and, in the Agent's discretion, file any
claim or take any other action or proceeding to protect and realize
upon the security interest of the Lenders in the Accounts. Each
Obligor acknowledges and agrees that the Proceeds of its Accounts
remitted to or on behalf of the Agent in accordance with the
provisions hereof shall be solely for the Agent's own convenience and
that such
13
Obligor shall not have any right, title or interest in such Accounts
or in any such other amounts except as expressly provided herein. The
Agent and the Lenders shall have no liability or responsibility to any
Obligor for acceptance of a check, draft or other order for payment of
money bearing the legend "payment in full" or words of similar import
or any other restrictive legend or endorsement or be responsible for
determining the correctness of any remittance. Each Obligor hereby
agrees to indemnify the Agent and the Lenders from and against all
liabilities, damages, losses, actions, claims, judgments, costs,
expenses, charges and reasonable attorneys' fees suffered or incurred
by the Agent or the Lenders because of the maintenance of the
foregoing arrangements except as relating to or arising out of the
gross negligence or willful misconduct of the Agent or a Lender or its
officers, employees or agents.
(c) Access. In addition to the rights and remedies
hereunder, upon the occurrence of an Event of Default and during the
continuance thereof, the Agent shall have the right to enter and
remain upon the various premises of the Obligors without cost or
charge to the Agent, and use the same, together with materials,
supplies, books and records of the Obligors for the purpose of
collecting and liquidating the Collateral, or for preparing for sale
and conducting the sale of the Collateral, whether by foreclosure,
auction or otherwise. In addition, the Agent may remove Collateral,
or any part thereof, from such premises and/or any records with
respect thereto, in order to effectively collect or liquidate such
Collateral.
(d) Nonexclusive Nature of Remedies. Failure by the
Agent or the Lenders to exercise any right, remedy or option under
this Security Agreement, any other Credit Document or as provided by
law, or any delay by the Agent or the Lenders in exercising the same,
shall not operate as a waiver of any such right, remedy or option. No
waiver hereunder shall be effective unless it is in writing, signed by
the party against whom such waiver is sought to be enforced and then
only to the extent specifically stated, which in the case of the Agent
or the Lenders shall only be granted as provided herein. To the
extent permitted by law, neither the Agent, the Lenders, nor any party
acting as attorney for the Agent or the Lenders, shall be liable
hereunder for any acts or omissions or for any error of judgment or
mistake of fact or law other than their gross negligence or willful
misconduct hereunder. The rights and remedies of the Agents and the
Lenders under this Security Agreement shall be cumulative and not
exclusive of any other right or remedy which the Agent or the Lenders
may have.
(e) Retention of Collateral. The Agent may, after
providing the notices required by Section 9-505(2) of the UCC or
otherwise complying with the requirements of applicable law of the
relevant jurisdiction, to the extent the Agent is in possession of any
of the Collateral, retain the Collateral in satisfaction of the
Secured Obligations. Unless and until the Agent shall have provided
such notices, however, the Agent shall not be deemed to have retained
any Collateral in satisfaction of any Secured Obligations for any
reason.
14
(f) Deficiency. In the event that the proceeds of any
sale, collection or realization are insufficient to pay all amounts to
which the Agent or the Lenders are legally entitled, the Obligors
shall be jointly and severally liable for the deficiency, together
with interest thereon at the default rate specified in Section 3.1(b)
of the Credit Agreement for Revolving Loans that are Base Rate Loans,
together with the costs of collection and the reasonable fees of any
attorneys employed by the Agent to collect such deficiency. Any
surplus remaining after the full payment and satisfaction of the
Secured Obligations shall be returned to the Obligors or to whomsoever
a court of competent jurisdiction shall determine to be entitled
thereto.
9. Rights of the Agent.
(a) Power of Attorney. In addition to other powers of
attorney contained herein, each Obligor hereby designates and appoints
the Agent, on behalf of the Lenders, and each of its designees or
agents, as attorney-in-fact of such Obligor, irrevocably and with
power of substitution, with authority to take any or all of the
following actions upon the occurrence and during the continuance of an
Event of Default:
(i) to demand, collect, settle, compromise,
adjust, give discharges and releases, all as the Agent may
reasonably determine;
(ii) to commence and prosecute any actions at any
court for the purposes of collecting any Collateral and
enforcing any other right in respect thereof;
(iii) to defend, settle or compromise any action
brought and, in connection therewith, give such discharge or
release as the Agent may deem reasonably appropriate;
(iv) receive, open and dispose of mail addressed
to an Obligor and endorse checks, notes, drafts, acceptances,
money orders, bills of lading, warehouse receipts or other
instruments or documents evidencing payment, shipment or
storage of the goods giving rise to the Collateral of such
Obligor on behalf of and in the name of such Obligor, or
securing, or relating to such Collateral;
(v) sell, assign, transfer, make any agreement in
respect of, or otherwise deal with or exercise rights in
respect of, any Collateral or the goods or services which have
given rise thereto, as fully and completely as though the Bank
were the absolute owner thereof for all purposes;
(vi) adjust and settle claims under any insurance
policy relating thereto;
15
(vii) execute and deliver all assignments,
conveyances, statements, financing statements, renewal
financing statements, security agreements, affidavits, notices
and other agreements, instruments and documents that the Agent
may determine necessary in order to perfect and maintain the
security interests and liens granted in this Security
Agreement and in order to fully consummate all of the
transactions contemplated therein;
(viii) institute any foreclosure proceedings that
the Agent may deem appropriate; and
(ix) do and perform all such other acts and things
as the Agent may reasonably deem to be necessary, proper or
convenient in connection with the Collateral.
This power of attorney is a power coupled with an interest and shall
be irrevocable (i) for so long as any of the Secured Obligations
remain outstanding, any Credit Document is in effect or any Letter of
Credit shall remain outstanding and (ii) until all of the Commitments
shall have been terminated. The Agent shall be under no duty to
exercise or withhold the exercise of any of the rights, powers,
privileges and options expressly or implicitly granted to the Agent in
this Security Agreement, and shall not be liable for any failure to do
so or any delay in doing so. The Agent shall not be liable for any
act or omission or for any error of judgment or any mistake of fact or
law in its individual capacity or its capacity as attorney-in-fact
except acts or omissions resulting from its gross negligence or
willful misconduct. This power of attorney is conferred on the Agent
solely to protect, preserve and realize upon its security interest in
the Collateral.
(b) Performance by the Agent of Obligations. If any
Obligor fails to perform any agreement or obligation contained herein,
the Agent itself may perform, or cause performance of, such agreement
or obligation, and the expenses of the Agent incurred in connection
therewith shall be payable by the Obligors on a joint and several
basis pursuant to Section 11 hereof.
(c) Assignment by the Agent. The Agent may from time to
time assign the Secured Obligations and any portion thereof and/or the
Collateral and any portion thereof, and the assignee shall be entitled
to all of the rights and remedies of the Agent under this Security
Agreement in relation thereto.
(d) The Agent's Duty of Care. Other than the exercise of
reasonable care to assure the safe custody of the Collateral while
being held by the Agent hereunder, the Agent shall have no duty or
liability to preserve rights pertaining thereto, it being understood
and agreed that the Obligors shall be responsible for preservation of
all rights in the Collateral, and the Agent shall be relieved of all
responsibility for the Collateral upon surrendering it or tendering
the surrender of it to the Obligors. The Agent shall be deemed to
have exercised
16
reasonable care in the custody and preservation of the Collateral in
its possession if the Collateral is accorded treatment substantially
equal to that which the Agent accords its own property, which shall be
no less than the treatment employed by a reasonable and prudent agent
in the industry, it being understood that the Agent shall not have
responsibility for taking any necessary steps to preserve rights
against any parties with respect to any of the Collateral.
10. Application of Proceeds. Upon the occurrence and during the
continuance of an Event of Default, any payments in respect of the Secured
Obligations and any proceeds of the Collateral, when received by the Agent or
any of the Lenders in cash or its equivalent, will be applied in reduction of
the Secured Obligations in the order set forth in Section 3.8 of the Credit
Agreement, and each Obligor irrevocably waives the right to direct the
application of such payments and proceeds and acknowledges and agrees that the
Agent shall have the continuing and exclusive right to apply and reapply any
and all such payments and proceeds in the Agent's sole discretion,
notwithstanding any entry to the contrary upon any of its books and records.
11. Costs of Counsel. If at any time hereafter, whether upon the
occurrence of an Event of Default or not, the Agent employs counsel to prepare
or consider amendments, waivers or consents with respect to this Security
Agreement, or to take action or make a response in or with respect to any legal
or arbitral proceeding relating to this Security Agreement or relating to the
Collateral, or to protect the Collateral or exercise any rights or remedies
under this Security Agreement or with respect to the Collateral, then the
Obligors agree to promptly pay upon demand any and all such reasonable
documented costs and reasonable expenses of the Agent or the Lenders, all of
which costs and expenses shall constitute Secured Obligations hereunder.
12. Continuing Agreement.
(a) This Security Agreement shall be a continuing
agreement in every respect and shall remain in full force and effect
so long as any of the Secured Obligations remain outstanding, any
Credit Document is in effect or any Letter of Credit shall remain
outstanding, and until all of the Commitments thereunder shall have
terminated (other than any obligations with respect to the indemnities
and the representations and warranties set forth in the Credit
Documents). Upon such payment and termination, this Security
Agreement shall be automatically terminated and the Agent and the
Lenders shall, upon the request and at the expense of the Obligors,
forthwith release all of its liens and security interests hereunder
and shall execute and deliver all UCC termination statements and/or
other documents reasonably requested by the Obligors evidencing such
termination. Notwithstanding the foregoing all releases and
indemnities provided hereunder shall survive termination of this
Security Agreement.
(b) This Security Agreement shall continue to be
effective or be automatically reinstated, as the case may be, if at
any time payment, in whole or in part, of any of the Secured
Obligations is rescinded or must otherwise be restored or returned by
the Agent or
17
any Lender as a preference, fraudulent conveyance or otherwise under
any bankruptcy, insolvency or similar law, all as though such payment
had not been made; provided that in the event payment of all or any
part of the Secured Obligations is rescinded or must be restored or
returned, all reasonable costs and expenses (including without
limitation any reasonable legal fees and disbursements) incurred by
the Agent or any Lender in defending and enforcing such reinstatement
shall be deemed to be included as a part of the Secured Obligations.
13. Amendments; Waivers; Modifications. This Security Agreement
and the provisions hereof may not be amended, waived, modified, changed,
discharged or terminated except as set forth in Section 11.6 of the Credit
Agreement.
14. Successors in Interest. This Security Agreement shall create
a continuing security interest in the Collateral and shall be binding upon each
Obligor, its successors and assigns and shall inure, together with the rights
and remedies of the Agent and the Lenders hereunder, to the benefit of the
Agent and the Lenders and their successors and permitted assigns; provided,
however, that none of the Obligors may assign its rights or delegate its duties
hereunder without the prior written consent of each Lender or the Required
Lenders, as required by the Credit Agreement. To the fullest extent permitted
by law, each Obligor hereby releases the Agent and each Lender, and its
successors and assigns, from any liability for any act or omission relating to
this Security Agreement or the Collateral, except for any liability arising
from the gross negligence or willful misconduct of the Agent, or such Lender,
or its officers, employees or agents.
15. Notices. All notices required or permitted to be given under
this Security Agreement shall be in conformance with Section 11.1 of the Credit
Agreement.
16. Counterparts. This Security Agreement may be executed in any
number of counterparts, each of which where so executed and delivered shall be
an original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this Security Agreement to produce or
account for more than one such counterpart.
17. Headings. The headings of the sections and subsections hereof
are provided for convenience only and shall not in any way affect the meaning
or construction of any provision of this Security Agreement.
18. Governing Law; Submission to Jurisdiction; Venue.
(a) THIS SECURITY AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK. Any legal action or proceeding with respect to this
Security Agreement may be brought in the courts of the State of New
York, or of the United States for the Southern District of New York,
and, by
18
execution and delivery of this Security Agreement, each Obligor hereby
irrevocably accepts for itself and in respect of its property,
generally and unconditionally, the jurisdiction of such courts. Each
Obligor further irrevocably consents to the service of process out of
any of the aforementioned courts in any such action or proceeding by
the mailing of copies thereof by registered or certified mail, postage
prepaid, to it at the address for notices pursuant to Section 11.1 of
the Credit Agreement, such service to become effective 30 days after
such mailing. Nothing herein shall affect the right of the Agent to
serve process in any other manner permitted by law or to commence
legal proceedings or to otherwise proceed against any Obligor in any
other jurisdiction.
(b) Each Obligor hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of
the aforesaid actions or proceedings arising out of or in connection
with this Security Agreement brought in the courts referred to in
subsection (a) hereof and hereby further irrevocably waives and agrees
not to plead or claim in any such court that any such action or
proceeding brought in any such court has been brought in an
inconvenient forum.
19. Waiver of Jury Trial. TO THE EXTENT PERMITTED BY APPLICABLE
LAW, EACH OF THE PARTIES TO THIS SECURITY AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO THIS SECURITY AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
20. Severability. If any provision of any of the Security
Agreement is determined to be illegal, invalid or unenforceable, such provision
shall be fully severable and the remaining provisions shall remain in full
force and effect and shall be construed without giving effect to the illegal,
invalid or unenforceable provisions.
21. Entirety. This Security Agreement and the other Credit
Documents represent the entire agreement of the parties hereto and thereto, and
supersede all prior agreements and understandings, oral or written, if any,
including any commitment letters or correspondence relating to the Credit
Documents or the transactions contemplated herein and therein.
22. Survival. All representations and warranties of the Obligors
hereunder shall survive the execution and delivery of this Security Agreement
and the other Credit Documents, the delivery of the Notes and the making of the
Loans and the issuance of the Letters of Credit under the Credit Agreement.
23. Other Security. To the extent that any of the Secured
Obligations are now or hereafter secured by property other than the Collateral
(including, without limitation, real property and securities owned by an
Obligor), or by a guarantee, endorsement or property of any other Person, then
the Agent and the Lenders shall have the right to proceed against such other
property, guarantee
19
or endorsement upon the occurrence of any Event of Default, and the Agent and
the Lenders have the right, in their sole discretion, to determine which
rights, security, liens, security interests or remedies the Agent and the
Lenders shall at any time pursue, relinquish, subordinate, modify or take with
respect thereto, without in any way modifying or affecting any of them or any
of the Agent's and the Lenders' rights or the Secured Obligations under this
Security Agreement, under any other of the Credit Documents.
24. Limitation of Liability. Notwithstanding any provision to the
contrary contained herein or in any other of the Credit Documents, to the
extent the obligations of an Obligor shall be adjudicated to be invalid or
unenforceable for any reason (including, without limitation, because of any
applicable state or federal law relating to fraudulent conveyances or
transfers) then the obligations of such Obligor hereunder shall be limited to
the maximum amount that is permissible under applicable law (whether federal or
state and including, without limitation, the Bankruptcy Code).
25. Rights of Required Lenders. All rights of the Agent
hereunder, if not exercised by the Agent, may be exercised by the Required
Lenders.
26. Conflicts with Pledge Agreement. To the extent that any
provisions set forth herein shall conflict with any provisions set forth in the
Pledge Agreement defined in and executed in connection with the Credit
Agreement, the provisions of the Pledge Agreement shall control.
[remainder of page intentionally left blank]
20
Each of the parties hereto has caused a counterpart of this Security
Agreement to be duly executed and delivered as of the date first above written.
BORROWER: STEEL HEDDLE MFG. CO.
By: /s/ Xxxxxxxx X. Team
----------------------------
Name: Xxxxxxxx X. Team
----------------------------
Title: President
----------------------------
GUARANTORS: STEEL HEDDLE INTERNATIONAL, INC.
By: /s/ Xxxxxxxx X. Team
----------------------------
Name: Xxxxxxxx X. Team
----------------------------
Title: President
----------------------------
HEDDLE CAPITAL CORP.
By: /s/ Xxxxx X. Xxxxxx
----------------------------
Name: Xxxxx X. Xxxxxx
----------------------------
Title: President
----------------------------
Accepted and agreed to in Charlotte, North Carolina as of the date
first above written.
NATIONSBANK, N.A., as Agent
By: /s/ Xxxxx X. Xxxxx
----------------------------
Name: Xxxxx X. Xxxxx
----------------------------
Title: Vice President
----------------------------
21
SCHEDULE 1(b)
INTELLECTUAL PROPERTY
U.S. TRADEMARKS OF
STEEL HEDDLE MFG. CO.
Registered Trademarks
--------------------------------------------------------------------------------------------------------
XXXX REGISTRATION NO. REGISTRATION DATE
--------------------------------------------------------------------------------------------------------
JET EYE 2,062,780 5/20/97
--------------------------------------------------------------------------------------------------------
DRAW-O 1,496,549 7/19/88
--------------------------------------------------------------------------------------------------------
DURALITE 1,177,859 11/17/81
--------------------------------------------------------------------------------------------------------
SH 1,168,075 9/8/81
--------------------------------------------------------------------------------------------------------
U.S. PATENTS OF
STEEL HEDDLE MFG. CO.
Issued Patents
-------------------------------------------------------------------------------------------------------------
PATIENT NO. FILING DATE DESCRIPTION
-------------------------------------------------------------------------------------------------------------
5,630,448 3/25/96 Heddle frame with torque locking block center brace assembly
-------------------------------------------------------------------------------------------------------------
5,560,399 1/31/95 Heddle frame with locking clamp block center brace assembly
-------------------------------------------------------------------------------------------------------------
5,477,889 12/16/94 Heddle frame endbrace assembly
-------------------------------------------------------------------------------------------------------------
5,415,205 2/25/94 Double xxxx xxxx with increased separation between front and back
dent rows
-------------------------------------------------------------------------------------------------------------
5,411,061 12/16/93 Heddle frame assembly with releasable end braces
-------------------------------------------------------------------------------------------------------------
5,348,055 5/6/93 Heddle eyelet structure
-------------------------------------------------------------------------------------------------------------
5,275,210 8/11/92 Nose guide for a heddle frame
-------------------------------------------------------------------------------------------------------------
4,924,916 5/19/89 Harness frame with drop-through bolted centerpiece
-------------------------------------------------------------------------------------------------------------
4,913,194 11/18/88 Light weight heddle frame assembly slat
-------------------------------------------------------------------------------------------------------------
4,913,193 2/14/89 Light weight heddle support bar
-------------------------------------------------------------------------------------------------------------
4,706,717 8/25/86 Heddle frame for a high speed weaving machine
-------------------------------------------------------------------------------------------------------------
4,687,030 8/14/86 Heddle frame for a high speed weaving machine
-------------------------------------------------------------------------------------------------------------
4,633,916 6/24/85 Roll-formed shear-resistant frame slat
-------------------------------------------------------------------------------------------------------------
4,596,275 10/12/84 Reinforced heddle frame slat and method
-------------------------------------------------------------------------------------------------------------
4,572,241 11/20/84 Xxxx xxxxxx device
-------------------------------------------------------------------------------------------------------------
4,331,865 10/9/79 Dent counter for loom xxxx
-------------------------------------------------------------------------------------------------------------
22
-------------------------------------------------------------------------------------------------------------
4,298,032 9/7/78 Shuttle grip
-------------------------------------------------------------------------------------------------------------
4,254,802 5/17/79 Apparatus for reinforcing a heddle frame slat of a loom
-------------------------------------------------------------------------------------------------------------
4,252,153 4/23/79 Heddle xxx xxxx device for a loom
-------------------------------------------------------------------------------------------------------------
4,232,713 4/23/79 Heddle frame nose guide
-------------------------------------------------------------------------------------------------------------
23
U.S. COPYRIGHTS
OF
STEEL HEDDLE MFG. CO.
NONE
24
SCHEDULE 4(a)
CHIEF EXECUTIVE OFFICE
1. Steel Heddle Mfg. Co.
0000 Xxxxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
2. Heddle Capital Corp.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
3. Steel Heddle International, Inc.
0000 Xxxxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
4. Steel Huddle International de Mexico, S.A. DE C.V.
Privada de la Xxxxxxx Xx. 000
Xxxxxxx Xxxxxx Xxxxxx
Delegacion Azcapotzalco
5. Steel Heddle International Japan (Branch)
Room 905, 1/Otsubashi
Tensho Building, Xx. 0
0-00-00, Xxxxxxxxx, Xxxxx-Xx
Xxxxx 000, Xxxxx
25
SCHEDULE 4(b)
LOCATIONS OF COLLATERAL
OWNED REAL PROPERTY
Location County
-------- ------
0000 Xxxxxxxxxx Xxxx Xxxxxxxxxx
Xxxxxxxxxx, XX 00000
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
000 Xxxx Xxxx Xxxx Xxxxxxxx
Xxxxxxxxxx, XX 00000
(excluding 0.58 acres sold on
March 12, 1998 for $183,392.93)
Xxxxxxx 000, Xxx Xxxx Xxxxxxxxxx
Xxxxxxxxxx, XX 00000
TANGIBLE PERSONAL PROPERTY LOCATED
1. See Schedule 6.22(a)
2. Privada de la Xxxxxxx, Xx. 000, Xxxxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx
Xxxxxxxxxxxx, 00000, Xxxxxx, D. F.
3. Room 905, 1/Otsubashi, Tensho Building, Xx. 0, 0-00-00, Xxxxxxxxx,
Xxxxx-Xx, Xxxxx 000, Xxxxx
26
SCHEDULE 4(c)
MERGERS, CONSOLIDATIONS, CHANGE IN STRUCTURE OR USE OF TRADENAMES
NONE
27
SCHEDULE 5(f)(i)
NOTICE
OF
GRANT OF SECURITY INTEREST
IN
COPYRIGHTS
United States Copyright Office
Gentlemen:
Please be advised that pursuant to the Security Agreement dated as of
May 22, 1998 (as the same may be amended, modified, extended or restated from
time to time, the "Security Agreement") by and among the Obligors party thereto
(each an "Obligor" and collectively, the "Obligors") and NationsBank, N.A., as
Agent (the "Agent") for the lenders referenced therein (the "Lenders"), the
undersigned Obligor has granted a continuing security interest in and
continuing lien upon, the copyrights and copyright applications shown below to
the Agent for the ratable benefit of the Lenders:
COPYRIGHTS
Date of
Copyright No. Description of Copyright Copyright
------------- ------------------------- ---------
Copyright Applications
Copyright Description of Copyright Date of Copyright
Applications No. Applied For Applications
---------------- ------------------------ -----------------
28
The Obligors and the Agent, on behalf of the Lenders, hereby
acknowledge and agree that the security interest in the foregoing copyrights
and copyright applications (i) may only be terminated in accordance with the
terms of the Security Agreement and (ii) is not to be construed as an
assignment of any copyright or copyright application.
Very truly yours,
--------------------------
[Obligor]
By:
Name:
Title:
Acknowledged and Accepted:
NATIONSBANK, N.A., as Agent
By:
Name:
Title:
29
SCHEDULE 5(f)(ii)
NOTICE
OF
GRANT OF SECURITY INTEREST
IN
PATENTS
United States Patent and Trademark Office
Gentlemen:
Please be advised that pursuant to the Security Agreement dated as of
May 22, 1998 (the "Security Agreement") by and among the Obligors party thereto
(each an "Obligor" and collectively, the "Obligors") and NationsBank, N.A., as
Agent (the "Agent") for the lenders referenced therein (the "Lenders"), the
undersigned Obligor has granted a continuing security interest in and
continuing lien upon, the patents and patent applications shown below to the
Agent for the ratable benefit of the Lenders:
PATENTS
Patent Description of Patent Date of
No. Item Patent
---------------- ------------------------ -------
Patent Applications
Patent Description of Patent Date of Patent
Applications No. Applied For Applications
---------------- ------------------------ -----------------
30
The Obligors and the Agent, on behalf of the Lenders, hereby
acknowledge and agree that the security interest in the foregoing patents and
patent applications (i) may only be terminated in accordance with the terms of
the Security Agreement and (ii) is not to be construed as an assignment of any
patent or patent application.
Very truly yours,
------------------------
[Obligor]
By:
Name:
Title:
Acknowledged and Accepted:
NATIONSBANK, N.A., as Agent
By:
Name:
Title:
31
SCHEDULE 5(f)(iii)
NOTICE
OF
GRANT OF SECURITY INTEREST
IN
TRADEMARKS
United States Patent and Trademark Office
Gentlemen:
Please be advised that pursuant to the Security Agreement dated as of
May 22, 1998 (the "Security Agreement") by and among the Obligors party thereto
(each an "Obligor" and collectively, the "Obligors") and NationsBank, N.A., as
Agent (the "Agent") for the lenders referenced therein (the "Lenders"), the
undersigned Obligor has granted a continuing security interest in and
continuing lien upon, the trademarks and trademark applications shown below to
the Agent for the ratable benefit of the Lenders:
TRADEMARKS
Description of Trademark Date of
Trademark No. Item Trademark
------------- ------------------------ ---------
Trademark Applications
Trademark Description of Trademark Date of Trademark
Applications No. Applied For Applications
---------------- ------------------------ -----------------
32
The Obligors and the Agent, on behalf of the Lenders, hereby
acknowledge and agree that the security interest in the foregoing trademarks
and trademark applications (i) may only be terminated in accordance with the
terms of the Security Agreement and (ii) is not to be construed as an
assignment of any trademark or trademark application.
Very truly yours,
-----------------------------------
[Obligor]
By:
Name:
Title:
Acknowledged and Accepted:
NATIONSBANK, N.A., as Agent
By:
Name:
Title:
