SECURITY AGREEMENT
EXHIBIT
99.4
SECURITY
AGREEMENT,
dated
as of January 24, 2007 (this "Agreement")
made
by FP Technology, Inc., a Delaware Corporation (the "Company"),
in
favor of, THE BANK OF NEW YORK, a New York banking corporation, in its capacity
as collateral agent for the Holders (as defined below) (in such capacity and
together with its successors in such capacity, the "Collateral
Agent").
W I T N E S S E T H:
WHEREAS,
the Company and The Bank of New York, as Trustee (the "Trustee")
are
parties to an Indenture dated as of January 24, 2007 (as amended, restated,
supplemented or otherwise modified from time to time, the "Indenture"),
providing, subject to the terms and conditions thereof, for the issuance by
the
Company of the "Notes" (as defined in the Indenture) (as such Notes may be
amended, restated, replaced or otherwise modified from time to time in
accordance with the terms thereof, collectively, the "Notes");
WHEREAS,
each of the "Holders" (as defined in the Indenture) (each a "Holder"
and
collectively, the "Holders")
has
entered into a Master Exchange Agreement of even date herewith (as amended,
restated or otherwise modified from time to time, the "Exchange
Agreement")
with
the Company providing, subject to the terms and conditions thereof, for the
exchange of the Nonconvertible Notes (as defined therein) for the Notes and
"Warrants" (as defined therein) from the Company; and
WHEREAS,
it is a condition precedent to the purchase by the Holders of the Notes under
the Indenture, that the Company shall have executed and delivered to the
Collateral Agent this Agreement providing for the grant to the Collateral Agent
for the benefit of the Holders of a security interest in all personal property
of the Company to secure all of the Company's obligations under the Indenture
and the Notes;
NOW,
THEREFORE, in consideration of the premises and the agreements herein and in
order to induce the Trustee to enter into the Indenture and the Holders to
purchase the Securities (as defined in the Exchange Agreement) pursuant to
the
Exchange Agreement, the Company agrees with the Collateral Agent, for the
benefit of the Trustee and the Holders, as follows:
SECTION
1. Definitions.
(a) Reference
is hereby made to the Indenture, the Exchange Agreement and the Notes for a
statement of the terms thereof. All terms used in this Agreement and the
recitals hereto which are defined in the Indenture, the Exchange Agreement,
the
Notes or in Articles 8 or 9 of the Uniform Commercial Code (the "Code")
as in
effect from time to time in the State of New York, and which are not otherwise
defined herein shall have the same meanings herein as set forth therein;
provided
that
terms used herein which are defined in the Code as in effect
in
the State of New York on the date hereof shall continue to have the same meaning
notwithstanding any replacement or amendment of such statute except as the
Collateral Agent may otherwise determine.
(b) The
following terms shall have the respective meanings provided for in the Code:
"Accounts", "Cash Proceeds", "Chattel Paper", "Commercial Tort Claim",
"Commodity Account", "Commodity Contracts", "Deposit Account", "Documents",
"Equipment", "Fixtures", "General Intangibles", "Goods", "Instruments",
"Inventory", "Investment Property", "Letter-of-Credit Rights", "Noncash
Proceeds", "Payment Intangibles", "Proceeds", "Promissory Notes", "Security",
"Record", "Security Account", "Software", and "Supporting
Obligations".
(c) As
used
in this Agreement, the following terms shall have the respective meanings
indicated below, such meanings to be applicable equally to both the singular
and
plural forms of such terms:
"Copyright
Licenses"
means
all licenses, contracts or other agreements, whether written or oral, naming
the
Company as licensee or licensor and providing for the grant of any right to
use
or sell any works covered by any copyright (including, without limitation,
all
Copyright Licenses set forth in Schedule
II
hereto).
"Copyrights"
means
all domestic and foreign copyrights, whether registered or not, including,
without limitation, all copyright rights throughout the universe (whether now
or
hereafter arising) in any and all media (whether now or hereafter developed),
in
and to all original works of authorship fixed in any tangible medium of
expression, acquired or used by the Company, all applications, registrations
and
recordings thereof (including, without limitation, applications, registrations
and recordings in the United States Copyright Office or in any similar office
or
agency of the United States or any other country or any political subdivision
thereof), and all reissues, divisions, continuations, continuations in part
and
extensions or renewals thereof.
"Event
of Default"
shall
have the meaning set forth in the Indenture.
"Insolvency
Proceeding"
means
any proceeding commenced by or against any Person under any provision of the
Bankruptcy Code (Chapter 11 of Title 11 of the United States Code) or under
any other bankruptcy or insolvency law, assignments for the benefit of
creditors, formal or informal moratoria, compositions, or extensions generally
with creditors, or proceedings seeking reorganization, arrangement, or other
similar relief.
"Intellectual
Property"
means
the Copyrights, Trademarks and Patents.
"Licenses"
means
the Copyright Licenses, the Trademark Licenses and the Patent
Licenses.
"Lien"
means
any mortgage, deed of trust, pledge, lien (statutory or otherwise), security
interest, charge or other encumbrance or security or preferential arrangement
of
any nature, including, without limitation, any conditional sale or title
retention arrangement, any capitalized lease and any assignment, deposit
arrangement or financing lease intended as, or having the effect of,
security.
"Patent
Licenses"
means
all licenses, contracts or other agreements, whether written or oral, naming
the
Company as licensee or licensor and providing for the grant of any right to
manufacture, use or sell any invention covered by any Patent (including, without
limitation, all Patent Licenses set forth in Schedule
II
hereto).
"Patents"
means
all domestic and foreign letters patent, design patents, utility patents,
industrial designs, inventions, trade secrets, ideas, concepts, methods,
techniques, processes, proprietary information, technology, know-how, formulae,
rights of publicity and other general intangibles of like nature, now existing
or hereafter acquired (including, without limitation, all domestic and foreign
letters patent, design patents, utility patents, industrial designs, inventions,
trade secrets, ideas, concepts, methods, techniques, processes, proprietary
information, technology, know-how and formulae described in Schedule
II hereto),
all applications, registrations and recordings thereof (including, without
limitation, applications, registrations and recordings in the United States
Patent and Trademark Office, or in any similar office or agency of the United
States or any other country or any political subdivision thereof), and all
reissues, divisions, continuations, continuations in part and extensions or
renewals thereof.
"Permitted
Liens"
shall
have the meaning provided to such term in the Indenture.
"Reserve
Account"
shall
have the meaning provided to such term in the Indenture.
"Special
Purpose Acquisition Subsidiary"
means
any Subsidiary that has been acquired by the Company, or any Subsidiary of
the
Company that is formed for the purpose of making an acquisition.
"Subsidiary"
shall
have the meaning provided to such term in the Indenture.
"Trademark
Licenses"
means
all licenses, contracts or other agreements, whether written or oral, naming
the
Company as licensor or licensee and providing for the grant of any right
concerning any Trademark, together with any goodwill connected with and
symbolized by any such trademark licenses, contracts or agreements and the
right
to prepare for sale or lease and sell or lease any and all Inventory now or
hereafter owned by the Company and now or hereafter covered by such licenses
(including, without limitation, all Trademark Licenses described in Schedule
II
hereto).
"Trademarks"
means
all domestic and foreign trademarks, service marks, collective marks,
certification marks, trade names, business names, d/b/a's, Internet domain
names, trade styles, designs, logos and other source or business identifiers
and
all general intangibles of like nature, now or hereafter owned, adopted,
acquired or used by the Company (including, without limitation, all domestic
and
foreign trademarks, service marks, collective marks, certification marks, trade
names, business names, d/b/a's, Internet domain names, trade styles, designs,
logos and other source or business identifiers described in Schedule
II
hereto),
all applications, registrations and recordings thereof (including, without
limitation, applications, registrations and recordings 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), and all reissues, extensions or renewals thereof, together with all
goodwill of the business symbolized by such marks and all customer lists,
formulae and other Records of the Company relating to the distribution of
products and services in connection with which any of such marks are
used.
"Transaction
Documents"
shall
have the meaning provided to such term in the Exchange Agreement.
SECTION
2. Grant
of Security Interest.
As
collateral security for all of the "Obligations" (as defined in Section
3
hereof),
the Company hereby pledges and assigns to the Collateral Agent for the benefit
of the Holders, and grants to the Collateral Agent for the benefit of the
Holders a continuing security interest in, all personal property of the Company,
wherever located and whether now or hereafter existing and whether now owned
or
hereafter acquired, of every kind and description, tangible or intangible
(collectively, the "Collateral"),
including, without limitation, the following:
(a) all
Accounts, except as otherwise provided for in this Agreement;
(b) subject
to Section 15.01(b) of the Indenture, all equity interests in Subsidiaries
of
the Company after the date hereof;
(c) all
Chattel Paper (whether tangible or electronic);
(d) the
Commercial Tort Claims specified on Schedule
VI
hereto;
(e) all
Deposit Accounts (including, without limitation, the Reserve Account), all
cash,
and all other property from time to time deposited therein and the monies and
property in the possession or under the control of the Collateral Agent or
any
Holder or any affiliate, representative, agent or correspondent of the
Collateral Agent or Holder;
(f) all
Documents;
(g) all
Equipment;
(h) all
Fixtures;
(i) all
General Intangibles (including, without limitation, all Payment
Intangibles);
(j) all
Goods;
(k) all
Instruments (including, without limitation, Promissory Notes and each
certificated Security);
(l) all
Inventory;
(m) all
Investment Property;
(n) all
Copyrights, Patents and Trademarks, and all Licenses;
(o) all
Letter-of-Credit Rights;
(p) all
Supporting Obligations;
(q) all
other
tangible and intangible personal property of the Company (whether or not subject
to the Code), including, without limitation, all bank and other accounts and
all
cash and all investments therein, all proceeds, products, offspring, accessions,
rents, profits, income, benefits, substitutions and replacements of and to
any
of the property of the Company described in the preceding clauses of this
Section
2
(including, without limitation, any proceeds of insurance thereon and all causes
of action, claims and warranties now or hereafter held by the Company in respect
of any of the items listed above), and all books, correspondence, files and
other Records, including, without limitation, all tapes, desks, cards, Software,
data and computer programs in the possession or under the control of the Company
or any other Person from time to time acting for the Company that at any time
evidence or contain information relating to any of the property described in
the
preceding clauses of this Section
2
or are
otherwise necessary or helpful in the collection or realization
thereof;
and
(r) all
Proceeds, including all Cash Proceeds and Noncash Proceeds, and products of
any
and all of the foregoing Collateral;
in
each
case howsoever the Company's interest therein may arise or appear (whether
by
ownership, security interest, claim or otherwise).
Notwithstanding
the foregoing, the parties agree that the cash in the initial amount of
US$1,414,736 deposited in account number 00000000 in the name of the Company
with Xxxxx Fargo Bank, NA is not part of the Collateral hereunder. Such amount
serves as collateral to secure the Company’s obligation under a certain letter
of credit issued by Xxxxx Fargo Bank, NA in favor of The Bank of New
York.
SECTION
3. Security
for Obligations.
The
security interest created hereby in the Collateral constitutes continuing
collateral security for all of the following obligations, whether now existing
or hereafter incurred (collectively, the "Obligations"):
(a) the
payment by the Company, as and when due and payable (by scheduled maturity,
required prepayment, acceleration, demand or otherwise), of all amounts from
time to time owing by it in respect of the Indenture, the Notes and the other
Transaction Documents, and; and
(b) the
due
performance and observance by the Company of all of its other obligations from
time to time existing in respect of any of the Transaction Documents, including
without limitation, with respect to any conversion or redemption rights of
the
Holders under the Notes, for so long as the Notes are outstanding.
SECTION
4. Representations
and Warranties.
The
Company represents and warrants as follows:
(a) Schedule
I
hereto
sets forth (i) the exact legal name of the Company, and (ii) the organizational
identification number of the Company or states that no such organizational
identification number exists.
(b) There
is
no pending or notice threatening any action, suit, proceeding or claim affecting
the Company before any governmental authority or any arbitrator, or any order,
judgment or award by any governmental authority or arbitrator, that may
adversely affect the grant by the Company, or the perfection, of the security
interest purported to be created hereby in the Collateral, or the exercise
by
the Collateral Agent of any of its rights or remedies hereunder.
(c) All
Federal, state and local tax returns and other reports required by applicable
law to be filed by the Company have been filed, or extensions have been
obtained, and all taxes, assessments and other governmental charges imposed
upon
the Company or any property of the Company (including, without limitation,
all
federal income and social security taxes on employees' wages) and which have
become due and payable on or prior to the date hereof have been paid, except
to
the extent contested in good faith by proper proceedings which stay the
imposition of any penalty, fine or Lien resulting from the non-payment thereof
and with respect to which adequate reserves have been set aside for the payment
thereof in accordance with generally accepted accounting principles consistently
applied ("GAAP").
(d) All
Equipment, Fixtures, Goods and Inventory of the Company now existing are, and
all Equipment, Fixtures, Goods and Inventory of the Company hereafter existing
will be, located and/or based at the addresses specified therefor in
Schedule
III
hereto,
except that the Company will give the Collateral Agent not less than 30 days'
prior written notice of any change of the location of any such Collateral,
other
than to locations set forth on Schedule
III
and with
respect to which the Collateral Agent has filed financing statements and
otherwise fully perfected its Liens thereon. The Company 's chief place of
business and chief executive office, the place where the Company keeps its
Records concerning Accounts and all originals of all Chattel Paper are located
at the addresses specified therefor in Schedule
III
hereto.
None of the Accounts is evidenced by Promissory Notes or other Instruments.
Set
forth in Schedule
IV
hereto
is a complete and accurate list, as of the date of this Agreement, of (i) each
Promissory Note, Company Security and other Instrument owned by the Company
and
(ii) each Deposit Account, Securities Account and Commodities Account of the
Company, together with the name and address of each institution at which each
such Account is maintained, the account number for each such Account and a
description of the purpose of each such Account. Set forth in Schedule
II hereto
is
a complete and correct list of each trade name used by the Company and the
name
of, and each trade name used by, each person from which the Company has acquired
any substantial part of the Collateral.
(e) The
Company has delivered to the Collateral Agent complete and correct copies of
each License described in Schedule
II
hereto,
including all schedules and exhibits thereto, which represents all of the
Licenses existing on the date of this Agreement. Each such License sets forth
the entire agreement and understanding of the parties thereto relating to the
subject matter thereof, and there are no other agreements, arrangements or
understandings, written or oral, relating to the matters covered thereby or
the
rights of the Company or any of its affiliates in respect thereof. Each material
License now existing is, and any material License entered into in the future
will be, the legal, valid and binding obligation of the parties thereto,
enforceable against such parties in accordance with its terms. No default under
any material License by any such party has occurred, nor does any defense,
offset, deduction or counterclaim exist thereunder in favor of any such
party.
(f) The
Company owns and controls, or otherwise possesses adequate rights to use, all
Trademarks, Patents and Copyrights, which are the only trademarks, patents,
copyrights, inventions, trade secrets, proprietary information and technology,
know-how, formulae, rights of publicity necessary to conduct its business in
substantially the same manner as conducted as of the date hereof. Schedule
II
hereto
sets forth a true and complete list of all registered copyrights, issued
Patents, Trademarks, and Licenses annually owned or used by the Company as
of
the date hereof. To the best knowledge of the Company except as otherwise
disclosed on Schedule
II hereto,
all such Intellectual Property of the Company is subsisting and in full force
and effect, has not been adjudged invalid or unenforceable, is valid and
enforceable and has not been abandoned in whole or in part. Except as set forth
in Schedule II, no such Intellectual Property is the subject of any licensing or
franchising agreement. The Company has no knowledge of any conflict with the
rights of others to any Intellectual Property and, to the best knowledge of
the
Company, the Company is not now infringing or in conflict with any such rights
of others in any material respect, and to the best knowledge of the Company,
no
other Person is now infringing or in conflict in any material respect with
any
such properties, assets and rights owned or used by the Company. The Company
has
not received any notice that it is violating or has violated the trademarks,
patents, copyrights, inventions, trade secrets, proprietary information and
technology, know-how, formulae, rights of publicity or other intellectual
property rights of any third party.
(g) The
Company is and will be at all times the sole and exclusive owner of, or
otherwise has and will have adequate rights in, the Collateral free and clear
of
any Liens, except for Permitted Liens on any Collateral. No effective financing
statement or other instrument similar in effect covering all or any part of
the
Collateral is on file in any recording or filing office except such as may
have
been filed in favor of the Collateral Agent relating to this Agreement or with
respect to Permitted Liens.
(h) The
exercise by the Collateral Agent of any of its rights and remedies hereunder
will not contravene any law or any contractual restriction binding on or
otherwise affecting the Company or any of its properties and will not result
in
or require the creation of any Lien, upon or with respect to any of its
properties.
(i) The
Perfection Certificate has been duly prepared, completed and executed and the
information set forth therein is correct and complete.
(j) No
authorization or approval or other action by, and no notice to or filing with,
any governmental authority or other regulatory body, or any other Person, is
required for (i) the grant by the Company, or the perfection, of the
security interest purported to be created hereby in the Collateral, or
(ii) the exercise by the Collateral Agent of any of its rights and remedies
hereunder, except (A) for the filing under the Uniform Commercial Code as
in effect in the applicable jurisdiction of the financing statements, all of
which financing statements, have been duly filed and are in full force and
effect, (B) with respect to the perfection of the security interest created
hereby in the Intellectual Property, for the recording of the appropriate
Assignment for Security, substantially in the form of Exhibit
A
hereto,
as applicable, in the United States Patent and Trademark Office or the United
States Copyright Office, as applicable, and (C) with respect to the
perfection of the security interest created hereby in foreign Intellectual
Property and Licenses, for registrations and filings in jurisdictions located
outside of the United States and covering rights in such jurisdictions relating
to the Intellectual Property and Licenses.
(k) This
Agreement creates in favor of the Collateral Agent a legal, valid and
enforceable security interest in the Collateral, as security for the
Obligations. The Collateral Agent's having possession of all Instruments and
cash (or entering into appropriate control documents) constituting Collateral
from time to time, the recording of the appropriate Assignment for Security
executed pursuant hereto in the United States Patent and Trademark Office and
the United States Copyright Office, as applicable, and the filing of the
financing statements and the other filings and recordings, as applicable,
described in Schedule
V
hereto
and, with respect to the Intellectual Property hereafter existing and not
covered by an appropriate Assignment for Security, the recording in the United
States Patent and Trademark Office or the United States Copyright Office, as
applicable, of appropriate instruments of assignment, result in the perfection
of such security interests. Such security interests are, or in the case of
Collateral in which the Company obtains rights after the date hereof, will
be,
perfected, first priority security interests, subject only to Permitted Liens
and the recording of such instruments of assignment. Such recordings and filings
and all other action necessary or desirable to perfect and protect such security
interest have been duly taken, except for the Collateral Agent's having
possession of Instruments and cash constituting Collateral after the date hereof
and the other filings and recordations described in Section
4(l)
hereof.
(l) As
of the
date hereof, the Company does not hold any Commercial Tort Claims nor is aware
of any such pending claims, except for such claims described in Schedule
VI.
SECTION
5. Covenants
as to the Collateral.
So long
as any of the Obligations shall remain outstanding, unless the Collateral Agent
shall otherwise consent in writing, after the approval of the Majority Holders
as contemplated in the Indenture:
(a) Further
Assurances.
The
Company will at its expense, at any time and from time to time, promptly execute
and deliver all further instruments and documents and take all further action
as
is necessary or otherwise as the Collateral Agent may reasonably request in
order to: (i) perfect and protect the security interest purported to be
created hereby; (ii) enable the Collateral Agent to exercise and enforce
its rights and remedies hereunder in respect of the Collateral; or
(iii) otherwise effect the purposes of this Agreement, including, without
limitation: (A) marking conspicuously all Chattel Paper and each License
and each of its Records pertaining to the Collateral with a legend, indicating
that such Chattel Paper, License or Collateral is subject to the security
interest created hereby, (B) delivering and pledging to the Collateral
Agent hereunder each Promissory Note, Security, Chattel Paper or other
Instrument, now or hereafter owned by the Company, duly endorsed and accompanied
by executed instruments of transfer or assignment, (C) executing and filing
(to the extent, if any, that the Company 's signature is required thereon)
or
authenticating the filing of, such financing or continuation statements, or
amendments thereto, as may be necessary or desirable or that the Collateral
Agent may request in order to perfect and preserve the security interest
purported to be created hereby, (D) furnishing to the Collateral Agent from
time to time statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral in each
case
as the Collateral Agent may reasonably request, all in reasonable detail,
(E) if any Collateral shall be in the possession of a third party,
notifying such Person of the Collateral Agent's security interest created hereby
and obtaining a written acknowledgment from such Person that such Person holds
possession of the Collateral for
the
benefit of the Collateral Agent, (F) if at any time after the date hereof,
the Company acquires or holds any Commercial Tort Claim, promptly notifying
the
Collateral Agent in a writing signed by the Company setting forth a brief
description of such Commercial Tort Claim and granting to the Collateral Agent
a
security interest therein and in the proceeds thereof, which writing shall
incorporate the provisions hereof, (G) upon the acquisition after the date
hereof by the Company of any motor vehicle or other Equipment subject to a
certificate of title or ownership (other than a motor vehicle or Equipment
that
is subject to a purchase money security interest), causing the Collateral Agent
to be listed as the lienholder on such certificate of title or ownership and
delivering evidence of the same to the Collateral Agent; and (H) taking all
actions required by any earlier versions of the Code or by other law, as
applicable, in any relevant Code jurisdiction, or by other law as applicable
in
any foreign jurisdiction.
(b) Location
of Equipment and Inventory.
The
Company will keep the Equipment and Inventory at the locations specified
therefor in Section 4(g)
hereof
or, at such other locations in the United States;
provided that the Company shall provide the Collateral Agent with a new
Schedule
V
hereto
indicating each new location of the Equipment and Inventory within five (5)
business days of any such change in location.
(c) Condition
of Equipment.
The
Company will maintain or cause the Equipment (necessary or useful to its
business) to be maintained and preserved in good condition, repair and working
order, ordinary wear and tear excepted, and will forthwith, or in the case
of
any loss or damage to any Equipment of the Company within a commercially
reasonable time after the occurrence thereof, make or cause to be made all
repairs, replacements and other improvements in connection therewith which
are
necessary or desirable, consistent with past practice, or which the Collateral
Agent may request to such end. The Company will promptly furnish to the
Collateral Agent a statement describing in reasonable detail any such loss
or
damage in excess of $150,000 to
any
Equipment.
(d) Taxes,
Etc.
The
Company agrees to pay promptly when due all property and other taxes,
assessments and governmental charges or levies imposed upon, and all claims
(including claims for labor, materials and supplies) against, the Equipment
and
Inventory, except to the extent the validity thereof is being contested in
good
faith by proper proceedings which stay the imposition of any penalty, fine
or
Lien resulting from the non-payment thereof and with respect to which adequate
reserves in accordance with GAAP have been set aside for the payment
thereof.
(e) Insurance.
(i) The
Company will, at its own expense, maintain insurance (including, without
limitation, commercial general liability and property insurance) with respect
to
the Equipment and Inventory in such amounts, against such risks, in such form
and with responsible and reputable insurance companies or associations as is
required by any governmental authority having jurisdiction with respect thereto
or as is carried generally in accordance with sound business practice by
companies in similar businesses similarly situated. Each such policy for
liability insurance shall provide for all losses to be paid on behalf of the
Collateral Agent and the Company as their respective interests may appear,
and
each policy for property damage insurance shall provide for all losses to be
adjusted with, and paid directly to, the Collateral Agent. Each such policy
shall in addition (A) name the Collateral Agent as an additional insured party
thereunder (without any representation or warranty by or obligation upon the
Collateral Agent) as their interests may appear, (B) contain an agreement by
the
insurer that any loss thereunder shall be payable to the Collateral Agent on
its
own account notwithstanding any action, inaction or breach of representation
or
warranty by the Company, (C) provide that there shall be no recourse against
the
Collateral Agent for payment of premiums or other amounts with respect thereto,
and (D) provide that at least 30 days' prior written notice of cancellation,
lapse, expiration or other adverse change shall be given to the Collateral
Agent
by the insurer. The Company will, if so requested by the Collateral Agent,
deliver to the Collateral Agent original or duplicate policies of such insurance
and, as often as the Collateral Agent may reasonably request, a report of a
reputable insurance broker with respect to such insurance. The Company will
also, at the request of the Collateral Agent, following a request to the
Collateral Agent by the Majority Holders, execute and deliver instruments of
assignment of such insurance policies and cause the respective insurers to
acknowledge notice of such assignment.
(ii) Reimbursement
under any liability insurance maintained by the Company pursuant to this
Section
5(e)
may be
paid directly to the Person who shall have incurred liability covered by such
insurance. In the case of any loss involving damage to Equipment or Inventory,
any proceeds of insurance maintained by the Company pursuant to this
Section
5(e)
shall be
paid to the Collateral Agent (except as to which paragraph (iii) of this
Section
5(e)
is not
applicable), the Company will make or cause to be made the necessary repairs
to
or replacements of such Equipment or Inventory, and any proceeds of insurance
maintained by the Company pursuant to this Section
5(e)
shall be
paid by the Collateral Agent to the Company as reimbursement for the costs
of
such repairs or replacements.
(iii) All
insurance payments in respect of such Equipment or Inventory shall be paid
to
the Collateral Agent and applied as specified in Section
7(b)
hereof.
(f) Provisions
Concerning the Accounts and the Licenses.
(i) The
Company will (A) give the Collateral Agent at least 30 days' prior written
notice of any change in the Company's name, identity or organizational
structure, (B) maintain its jurisdiction of incorporation as set forth in
Section
4(b)
hereto,
(C) immediately notify the Collateral Agent upon obtaining an organizational
identification number, if on the date hereof the Company did not have such
identification number, and (D) keep adequate records concerning the Accounts
and
Chattel Paper and permit representatives of the Collateral Agent during normal
business hours on reasonable notice to the Company, to inspect and make
abstracts from such Records and Chattel Paper.
(ii) The
Company will, except as otherwise provided in this subsection (f), continue
to collect, at its own expense, all amounts due or to become due under the
Accounts. In connection with such collections, the Company may (and, at the
Collateral Agent's direction, will) take such action as the Company or the
Collateral Agent may reasonably deem necessary or advisable to enforce
collection or performance of the Accounts; provided,
however,
that
the Collateral Agent shall have the right at any time, upon the occurrence
and
during the continuance of an Event of Default, to notify the account debtors
or
obligors under any Accounts of the assignment of such Accounts to the Collateral
Agent and to direct such account debtors or obligors to make payment of all
amounts due or to become due to the Company thereunder directly to the
Collateral Agent or its designated agent and, upon such notification and at
the
expense of the Company and to the extent permitted by law, to enforce collection
of any such Accounts and to adjust, settle or compromise the amount or payment
thereof, in the same manner and to the same extent as the Company might have
done. After receipt by the Company of a notice from the Collateral Agent that
an
Event of Default has occurred and that the Collateral Agent has notified,
intends to notify, or has enforced or intends to enforce the Company 's rights
against the account debtors or obligors under any Accounts as referred to in
the
proviso to the immediately preceding sentence, (A) all amounts and proceeds
(including Instruments) received by the Company in respect of the Accounts
shall
be received in trust for the benefit of the Collateral Agent hereunder, shall
be
segregated from other funds of the Company and shall be forthwith paid over
to
the Collateral Agent in the same form as so received (with any necessary
endorsement) to be held as cash collateral and applied as specified in
Section
7(b)
hereof,
and (B) the Company will not adjust, settle or compromise the amount or payment
of any Account or release wholly or partly any account debtor or obligor thereof
or allow any credit or discount thereon. In addition, upon the occurrence and
during the continuance of an Event of Default, the Collateral Agent may (in
its
sole and absolute discretion) direct any or all of the banks and financial
institutions with which the Company either maintains a Deposit Account or a
lockbox or deposits the proceeds of any Accounts to send immediately to the
Collateral Agent by wire transfer (to such account as the Collateral Agent
shall
specify, or in such other manner as the Collateral Agent shall direct) all
or a
portion of such securities, cash, investments and other items held by such
institution. Any such securities, cash, investments and other items so received
by the Collateral Agent shall (in the sole and absolute discretion of the
Collateral Agent) be held as additional Collateral for the Obligations or
distributed in accordance with Section
7
hereof.
(iii) Upon
the
occurrence and during the continuance of any breach or default under any
material License referred to in Schedule
II
hereto
by any party thereto other than the Company, the Company will, promptly after
obtaining knowledge thereof, give the Collateral Agent written notice of the
nature and duration thereof, specifying what action, if any, it has taken and
proposes to take with respect thereto and thereafter
will
take reasonable steps to protect and preserve its rights and remedies in respect
of such breach or default, or will obtain or acquire an appropriate substitute
License.
(iv) The
Company will, at its expense, promptly deliver to the Collateral Agent a copy
of
each notice or other communication received by it by which any other party
to
any material License referred to in Schedule
II
hereto
purports to exercise any of its rights or affect any of its obligations
thereunder, together with a copy of any reply by the Company
thereto.
(v) The
Company will exercise promptly and diligently each and every right which it
may
have under each material License (other than any right of termination) and
will
duly perform and observe in all respects all of its obligations under each
material License and will take all action reasonably necessary to maintain
such
Licenses in full force and effect. The Company will not, without the prior
written consent of the Collateral Agent after the approval of the Majority
Holders as contemplated in the Indenture, cancel, terminate, amend or otherwise
modify in any respect, or waive any provision of, any material License referred
to in Schedule
II
hereto.
(g) Transfers
and Other Liens.
(i) The
Company will not sell, assign (by operation of law or otherwise), lease,
license, exchange or otherwise transfer or dispose of any of the
Collateral,
except
(A) Inventory in the ordinary course of business, and (B) worn-out or obsolete
assets not necessary to the business.
(ii) The
Company will not create, suffer to exist or grant any Lien upon or with respect
to any Collateral other than a Permitted Lien.
(h) Intellectual
Property.
(i) If
applicable, the Company shall, upon the Collateral Agent's written request,
following a request to the Collateral Agent by the Majority Holders, duly
execute and deliver the applicable Assignment for Security in the form attached
hereto as Exhibit
A.
The
Company (either itself or through licensees) will, and will cause each licensee
thereof to, take all action necessary to maintain all of the Intellectual
Property in full force and effect, including, without limitation, using the
proper statutory notices and markings and using the Trademarks on each
applicable trademark class of goods in order to so maintain the Trademarks
in
full force and free from any claim of abandonment for non-use, and the
Company
will not
(nor permit any licensee thereof to) do any act or knowingly omit to do any
act
whereby any Intellectual Property may become invalidated; provided,
however,
that so
long as no Event of Default has occurred and is continuing, the
Company
shall
not have an obligation to use or to maintain any Intellectual Property
(A) that relates solely to any product or work, that has been, or is in the
process of being, discontinued, abandoned or terminated, (B) that is being
replaced with Intellectual Property substantially similar to the Intellectual
Property that may be abandoned or otherwise become invalid, so long as the
failure to use or maintain such Intellectual Property does not materially
adversely affect the validity of such replacement Intellectual Property and
so
long as such replacement Intellectual Property is subject to the Lien created
by
this Agreement or (C) that is substantially the same as another Intellectual
Property that is in full force, so long the failure to use or maintain such
Intellectual Property does not materially adversely affect the validity of
such
replacement Intellectual Property and so long as such other Intellectual
Property is subject to the Lien and security interest created by this Agreement.
The
Company
will
cause to be taken all necessary steps in any proceeding before the United States
Patent and Trademark Office and the United States Copyright Office or any
similar office or agency in any other country or political subdivision thereof
to maintain each registration of the Intellectual Property (other than the
Intellectual Property described in the proviso to the immediately preceding
sentence), including, without limitation, filing of renewals, affidavits of
use,
affidavits of incontestability and opposition, interference and cancellation
proceedings and payment of maintenance fees, filing fees, taxes or other
governmental fees. If any Intellectual Property (other than Intellectual
Property described in the proviso to the first sentence of subsection (i) of
this clause (h)) is infringed, misappropriated, diluted or otherwise violated
in
any material respect by a third party, the
Company
shall
(x) upon learning of such infringement, misappropriation, dilution or other
violation, promptly notify the Collateral Agent and (y) to the extent
the
Company
shall
deem appropriate under the circumstances, promptly xxx for infringement,
misappropriation, dilution or other violation, seek injunctive relief where
appropriate and recover any and all damages for such infringement,
misappropriation, dilution or other violation, or take such other actions as
the
Company
shall
deem appropriate under the circumstances to protect such Intellectual Property.
The
Company
shall
furnish to the Collateral Agent from time to time upon its request statements
and schedules further identifying and describing the Intellectual Property
and
Licenses and such other reports in connection with the Intellectual Property
and
Licenses as the Collateral Agent may reasonably request, all in reasonable
detail and promptly upon request of the Collateral Agent, following receipt
by
the Collateral Agent of any such statements, schedules or reports, the
Company
shall
modify this Agreement by amending Schedule
II
hereto,
as the case may be, to include any Intellectual Property and License, as the
case may be, which becomes part of the Collateral under this Agreement and
shall
execute and authenticate such documents and do such acts as shall be necessary
to subject such Intellectual Property and Licenses to the Lien and security
interest created by this Agreement. Notwithstanding anything herein to the
contrary, upon the occurrence and during the continuance of an Event of Default,
the
Company
may not
abandon or otherwise permit any Intellectual Property to become invalid without
the prior written consent of the Collateral Agent, and if any Intellectual
Property is infringed, misappropriated, diluted or otherwise violated in any
material respect by a third party, the
Company
will
take such action as appropriate under the circumstances to protect such
Intellectual Property.
(ii) In
no
event shall the Company, either itself or through any agent, employee, licensee
or designee, file an application for the registration of any Trademark or
Copyright or the issuance of any Patent with the United States Patent and
Trademark Office or the United States Copyright Office, as applicable, or in
any
similar office or agency of the United States or any country or any political
subdivision thereof unless it gives the Collateral Agent prior written notice
thereof. Upon request of the Collateral Agent, the Company shall execute,
authenticate and deliver any and all assignments, agreements, instruments,
documents and papers as the Collateral Agent may reasonably request, following
a
request to the Collateral Agent by the Majority Holders, to evidence the
Collateral Agent's security interest hereunder in such Intellectual Property
and
the General Intangibles of the Company relating thereto or represented thereby,
and the Company hereby appoints the Collateral Agent its attorney-in-fact to
execute and/or authenticate and file all such writings for the foregoing
purposes, all acts of such attorney being hereby ratified and confirmed, and
such power (being coupled with an interest) shall be irrevocable until the
indefeasible payment in full in cash of all of the Obligations in full and
the
termination of each of the Transaction Documents.
(i) Deposit,
Commodities and Securities Accounts.
Upon
the Collateral Agent's written request, following a request to the Collateral
Agent by the Majority Holders, the Company shall cause each bank and other
financial institution with an account referred to in Schedule
IV
hereto
to execute and deliver to the Collateral Agent a control agreement, in form
and
substance reasonably satisfactory to the Collateral Agent, duly executed by
the
Company and such bank or financial institution, or enter into other arrangements
in form and substance satisfactory to the Collateral Agent, pursuant to which
such institution shall irrevocably agree, inter alia,
that
(i) it will comply at any time with the instructions originated by the
Collateral Agent to such bank or financial institution directing the disposition
of cash, Commodity Contracts, Securities, Investment Property and other items
from time to time credited to such account, without further consent of the
Company, which instructions the Collateral Agent will not give to such bank
or
other financial institution in the absence of a continuing Event of Default,
(ii) all cash, Commodity Contracts, securities, Investment Property and
other items of the Company deposited with such institution shall be subject
to a
perfected, first priority security interest in favor of the Collateral Agent,
(iii) any right of set off, banker's Lien or other similar Lien, security
interest or encumbrance shall be fully waived as against the Collateral Agent,
and (iv) upon receipt of written notice from the Collateral Agent during
the continuance of an Event of Default, such bank or financial institution
shall
immediately send to the Collateral Agent by wire transfer (to such account
as
the Collateral Agent shall specify, or in such other manner as the Collateral
Agent shall direct) all such cash, the value of any Commodity Contracts,
Securities, Investment Property and other items held by it. The Company shall
not make or maintain any Deposit Account, Commodity Account or Securities
Account except for the accounts set forth in Schedule
IV
hereto.
The provisions of this paragraph 5(i) shall not apply to (i) Deposit Accounts
for which the Collateral Agent is the depositary and (ii) Deposit Accounts
specially and exclusively used for payroll, payroll taxes and other employee
wage and benefit payments to or for the benefit of the Company 's salaried
employees.
(j) Motor
Vehicles.
(i) Upon
the
Collateral Agent's written request, the Company shall deliver to the Collateral
Agent originals of the certificates of title or ownership for all motor vehicles
owned by it with a blue book value equal or in excess of $50,000, with the
Collateral Agent listed as lienholder, for the benefit of the
Holders.
(ii) The
Company hereby appoints the Collateral Agent as its attorney-in-fact, effective
the date hereof and terminating upon the termination of this Agreement, for
the
purpose of (A) executing on behalf of the Company title or ownership
applications for filing with appropriate state agencies to enable motor vehicles
now owned or hereafter acquired by such the Company to be retitled and the
Collateral Agent listed as lienholder thereof, (B) filing such applications
with
such state agencies, and (C) executing such other documents and instruments
on
behalf of, and taking such other action in the name of, the Company as the
Collateral Agent may deem necessary or advisable to accomplish the purposes
hereof (including, without limitation, for the purpose of creating in favor
of
the Collateral Agent a perfected Lien on the motor vehicles and exercising
the
rights and remedies of the Collateral Agent hereunder). This appointment as
attorney-in-fact is coupled with an interest and is irrevocable until all of
the
Obligations are indefeasibly paid in full in cash and after all Transaction
Documents have been terminated.
(iii) Any
certificates of title or ownership delivered pursuant to the terms hereof shall
be accompanied by odometer statements for each motor vehicle covered
thereby.
(iv) So
long
as no Event of Default shall have occurred and be continuing, upon the request
of the Company, the Collateral Agent shall execute and deliver to the Company
such instruments as the Company shall reasonably request to remove the notation
of the Collateral Agent as lienholder on any certificate of title for any motor
vehicle; provided,
however,
that
any such instruments shall be delivered, and the release effective, only upon
receipt by the Collateral Agent of a certificate from the Company stating that
such motor vehicle is to be sold or has suffered a casualty loss (with title
thereto passing to the casualty insurance company therefor in settlement of
the
claim for such loss) and the amount that the Company will receive as sale
proceeds or insurance proceeds. Any proceeds of such sale or casualty loss
shall
be paid to the Collateral Agent hereunder immediately upon receipt, to be
applied to the Obligations then outstanding.
(k) Control.
The
Company hereby agrees to take any or all action that may be necessary or
desirable or that the Collateral Agent may reasonably request in order for
the
Collateral Agent to obtain control in accordance with Sections 9-105 - 9-107
of
the Code with respect to the following Collateral: (i) Electronic Chattel
Paper, (ii) Investment Property, and (iii) Letter-of-Credit Rights.
(l) Inspection
and Reporting.
The
Company shall permit the Collateral Agent, or any agent or representatives
thereof or such professionals or other Persons as the Collateral Agent may
designate, not more than twice a year in the absence of an Event of Default,
upon prior notice and during regular business hours (i) to examine and make
copies of and abstracts from the Company 's records and books of account, (ii)
to visit and inspect its properties, (iii) to verify materials, leases,
Instruments, Accounts, Inventory and other assets of the Company from time
to
time, (iii) to conduct audits, physical counts, appraisals and/or
valuations, examinations at the locations of the Company. The Company shall
also
permit the Collateral Agent, or any agent or representatives thereof or such
professionals or other Persons as the Collateral Agent may designate to discuss
the Company 's affairs, finances and accounts with any of its directors,
officers, managerial employees, independent accountants or any of its other
representatives.
(m) Future
Subsidiaries.
If the
Company shall hereafter create or acquire any Subsidiary, simultaneously with
the creation or acquisition of such Subsidiary, the Company shall cause such
Subsidiary to become a party to this Agreement as a grantor hereunder, and
to
duly execute and deliver a guaranty of the Obligations in favor of the
Collateral Agent in form and substance reasonably acceptable to the Collateral
Agent and to duly execute and/or deliver such opinions of counsel and other
documents, in form and substance reasonably acceptable to the Collateral Agent,
as the Collateral Agent shall reasonably request with respect thereto;
provided,
however,
that
this subsection (m) shall not apply to any Subsidiary for which the Company
has
provided notice to the Collateral Agent at the time of the formation thereof
that such Subsidiary is a Special Purpose Acquisition Subsidiary and which
complies with the requirements set forth in the Indenture for Special Purpose
Acquisition Subsidiaries. The Company hereby agrees that it shall not make
capital contributions in excess of $[10,000] in cash or property of equivalent
value (or some combination thereof) to any such Special Purpose Acquisition
Subsidiary.
SECTION
6. Additional
Provisions Concerning the Collateral.
(a) The
Company hereby (i) authorizes the Collateral Agent to cause the filing of
one or more Code financing or continuation statements, and amendments thereto,
relating to the Collateral and (ii) ratifies such authorization to the
extent that the Collateral Agent has filed any such financing or continuation
statements, or amendments thereto, prior to the date hereof. 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.
Notwithstanding the foregoing, the Company shall at all times maintain perfected
the Security Interest granted hereunder without further act on the part of
the
Collateral Agent.
(b) The
Company hereby irrevocably appoints the Collateral Agent as its attorney-in-fact
and proxy, with full authority in the place and stead of the Company and in
the
name of the Company or otherwise, from time to time in the Collateral Agent's
discretion, so long as an Event of Default shall have occurred and is
continuing, to take any action and to execute any instrument which is necessary
and which the Collateral Agent may deem necessary or advisable to accomplish
the
purposes of this Agreement (subject to the rights of the Company under
Section
5
hereof),
including, without limitation, (i) to obtain and adjust insurance required
to be
paid to the Collateral Agent pursuant to Section
5(e)
hereof,
(ii) to ask, demand, collect, xxx for, recover, compound, receive and give
acquittance and receipts for moneys due and to become due under or in respect
of
any Collateral, (iii) to receive, endorse, and collect any drafts or other
instruments, documents and chattel paper in connection with clause (i) or (ii)
above, (iv) to file any claims or take any action or institute any proceedings
which the Collateral Agent may deem necessary or desirable for the collection
of
any Collateral or otherwise to enforce the rights of the Collateral Agent and
the Holders with respect to any Collateral, and (v) to execute assignments,
licenses and other documents to enforce the rights of the Collateral Agent
and
the Holders with respect to any Collateral. This power is coupled with an
interest and is irrevocable until all of the Obligations are indefeasibly paid
in full in cash.
(c) For
the
purpose of enabling the Collateral Agent to exercise rights and remedies
hereunder, at such time as the Collateral Agent shall be lawfully entitled
to
exercise such rights and remedies, and for no other purpose, the Company hereby
grants to the Collateral Agent, to the extent assignable, an irrevocable,
non-exclusive license (exercisable without payment of royalty or other
compensation to the Company) to use, assign, license or sublicense any
Intellectual Property now owned or hereafter acquired by the Company, wherever
the same may be located, including in such license reasonable access to all
media in which any of the licensed items may be recorded or stored and to all
computer programs used for the compilation or printout thereof. Notwithstanding
anything contained herein to the contrary, but subject to any provisions of
the
Indenture that limit the right of the Company to dispose of its property and
Section
5(h)
hereof,
so long as no Event of Default shall have occurred and be continuing, the
Company may exploit, use, enjoy, protect, license, sublicense, assign, sell,
dispose of or take other actions with respect to the Intellectual Property
in
the ordinary course of its business. In furtherance of the foregoing, unless
an
Event of Default shall have occurred and be continuing, the Collateral Agent
shall from time to time, upon the request of the Company, execute and deliver
any instruments, certificates or other documents, in the form so requested,
which the Company shall have certified are appropriate (in the Company 's
judgment) to allow it to take any action permitted above (including
relinquishment of the license provided pursuant to this clause (c) as to any
Intellectual Property). Further, upon the indefeasible payment in full in cash
of all of the Obligations, the Collateral Agent (subject to Section
10(e)
hereof)
shall release and reassign to the Company all of the Collateral Agent's right,
title and interest in and to the Intellectual Property, and the Licenses, all
without recourse, representation or warranty whatsoever. The exercise of rights
and remedies hereunder by the Collateral Agent shall not terminate the rights
of
the holders of any licenses or sublicenses theretofore granted by the Company
in
accordance with the second sentence of this clause (c). The Company hereby
releases the Collateral Agent from any claims, causes of action and demands
at
any time arising out of or with respect to any actions taken or omitted to
be
taken by the Collateral Agent under the powers of attorney granted herein other
than actions taken or omitted to be taken through the Collateral Agent's own
gross negligence or willful misconduct, as determined by a final determination
of a court of competent jurisdiction.
(d) If
the
Company fails to perform any agreement contained herein, the Collateral Agent
may (but is under no obligation to) itself perform, or cause performance of,
such agreement or obligation, in the name of the Company or the Collateral
Agent, and the expenses of the Collateral Agent incurred in connection therewith
shall be payable by the Company pursuant to Section
8
hereof
and shall be secured by the Collateral.
(e) The
powers conferred on the Collateral Agent 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 Collateral
Agent shall have no duty as to any Collateral or as to the taking of any
necessary steps to preserve rights against prior parties or any other rights
pertaining to any Collateral.
(f) Anything
herein to the contrary notwithstanding (i) the Company shall remain liable
under the Licenses and otherwise with respect to any of the Collateral to the
extent set forth therein to perform all of its obligations thereunder to the
same extent as if this Agreement had not been executed, (ii) the exercise
by the Collateral Agent of any of its rights hereunder shall not release the
Company from any of its obligations under the Licenses or otherwise in respect
of the Collateral, and (iii) the Collateral Agent shall not have any
obligation or liability by reason of this Agreement under the Licenses or with
respect to any of the other Collateral, nor shall the Collateral Agent be
obligated to perform any of the obligations or duties of the Company thereunder
or to take any action to collect or enforce any claim for payment assigned
hereunder.
(g) Beyond
the exercise of reasonable care in the custody thereof, the Collateral Agent
shall have no duty as to any Collateral in its possession or control or in
the
possession or control of any agent or bailee or any income thereon or as to
preservation of rights against prior parties or any other rights pertaining
thereto and the Collateral Agent shall not be responsible for filing any
financing or continuation statements or recording any documents or instruments
in any public office at any time or times or otherwise perfecting or maintaining
the perfection of any security interest in the Collateral. The Collateral Agent
shall be deemed to have exercised reasonable care in the custody of the
Collateral in its possession if the Collateral is accorded treatment
substantially equal to that which it accords its own property and shall not
be
liable or responsible for any loss or diminution in the value of any of the
Collateral, by reason of the act or omission of any carrier, forwarding agency
or other agent or bailee selected by the Collateral Agent in good
faith.
(h) The
Collateral Agent shall not be responsible for the exercise, genuineness or
value
of any of the Collateral or for the validity, perfection, priority or
enforceability of the Liens in any of the Collateral, whether impaired by
operation of law or by reason of any action or omission to act on its part
hereunder, except to the extent such action or omission constitutes gross
negligence, bad fait or willful misconduct on the part of the Collateral Agent,
for the validity or sufficiency of the Collateral or any agreement or assignment
contained therein, for the validity of the title of the Company to the
Collateral, for insuring the Collateral or for the payment of taxes, charges,
assessments or Liens upon the Collateral or otherwise as to the maintenance
of
the Collateral.
(i) Notwithstanding
anything in t his Agreement to the contrary and for the avoidance of doubt,
the
Collateral Agent shall have no duty to act outside of the United States in
respect of any Collateral located in the jurisdiction other than the United
States.
SECTION
7. Remedies
Upon Event of Default.
If any
Event of Default shall have occurred and be continuing:
(a) The
Collateral Agent may exercise in respect of the Collateral, in addition to
any
other rights and remedies provided for herein or otherwise available to it,
all
of the rights and remedies of a secured party upon default under the Code
(whether or not the Code applies to the affected Collateral), and also may
(i) take absolute control of the Collateral, including, without limitation,
transfer into the Collateral Agent's name or into the name of its nominee or
nominees (to the extent the Collateral Agent has not theretofore done so) and
thereafter receive, for the benefit of the Collateral Agent, all payments made
thereon, give all consents, waivers and ratifications in respect thereof and
otherwise act with respect thereto as though it were the outright owner thereof,
(ii) require the Company to, and the Company hereby agrees that it will at
its expense and upon request of the Collateral Agent forthwith, assemble all
or
part of its respective Collateral as directed by the Collateral Agent and make
it available to the Collateral Agent at a place or places to be designated
by
the Collateral Agent that is reasonably convenient to both parties, and the
Collateral Agent may enter into and occupy any premises owned or leased by
the
Company where the Collateral or any part thereof is located or assembled for
a
reasonable period in order to effectuate the Collateral Agent's rights and
remedies hereunder or under law, without obligation to the Company in respect
of
such occupation, and (iii) without notice except as specified below and
without any obligation to prepare or process the Collateral for sale,
(A) sell the Collateral or any part thereof in one or more parcels at
public or private sale, at any of the Collateral Agent's offices or elsewhere,
for cash, on credit or for future delivery, and at such price or prices and
upon
such other terms as the Collateral Agent may deem commercially reasonable and/or
(B) lease, license or dispose of the Collateral or any part thereof upon
such terms as the Collateral Agent may deem commercially reasonable. The Company
agrees that, to the extent notice of sale or any other disposition of its
respective Collateral shall be required by law, at least ten (10) days' notice
to the Company of the time and place of any public sale or the time after which
any private sale or other disposition of its respective Collateral is to be
made
shall constitute reasonable notification. The Collateral Agent shall not be
obligated to make any sale or other disposition of any Collateral regardless
of
notice of sale having been given. The Collateral Agent 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. The Company hereby waives any claims against
the Collateral Agent and the Holders arising by reason of the fact that the
price at which its respective Collateral may have been sold at a private sale
was less than the price which might have been obtained at a public sale or
was
less than the aggregate amount of the Obligations, even if the Collateral Agent
accepts the first offer received and does not offer such Collateral to more
than
one offeree, and waives all rights that such the Company may have to require
that all or any part of such Collateral be marshalled upon any sale (public
or
private) thereof. The Company hereby acknowledges that (i) any such sale of
its respective Collateral by the Collateral Agent shall be made without
warranty, (ii) the Collateral Agent may specifically disclaim any
warranties of title, possession, quiet enjoyment or the like, and
(iii) such actions set forth in clauses (i) and (ii) above shall not
adversely effect the commercial reasonableness of any such sale of Collateral.
In addition to the foregoing, (1) upon written notice to the Company from
the Collateral Agent, the Company shall cease any use of the Intellectual
Property or any trademark, patent or copyright similar thereto for any purpose
described in such notice; (2) the Collateral Agent may, at any time and from
time to time, upon 10 days' prior notice to the Company, license, whether
general, special or otherwise, and whether on an exclusive or non-exclusive
basis, any of the Intellectual Property, throughout the universe for such term
or terms, on such conditions, and in such manner, as the Collateral Agent shall
in its sole discretion determine; and (3) the Collateral Agent may, at any
time,
pursuant to the authority granted in Section
6
hereof
(such authority being effective upon the occurrence and during the continuance
of an Event of Default), execute and deliver on behalf of the Company, one
or
more instruments of assignment of the Intellectual Property (or any application
or registration thereof), in form suitable for filing, recording or registration
in any country.
(b) Any
cash
held by the Collateral Agent as Collateral and all Cash Proceeds received by
the
Collateral Agent in respect of any sale of or collection from, or other
realization upon, all or any part of the Collateral may, in the discretion
of
the Collateral Agent, be held by the Collateral Agent as collateral for, and/or
then or at any time thereafter applied (after payment of any amounts payable
to
the Collateral Agent pursuant to Section
8
hereof)
in whole or in part by the Collateral Agent against, all or any part of the
Obligations in such order as the Collateral Agent shall elect, consistent with
the provisions of the Indenture. Any surplus of such cash or Cash Proceeds
held
by the Collateral Agent and remaining after the indefeasible payment in full
in
cash of all of the Obligations shall be paid over to whomsoever shall be
lawfully entitled to receive the same or as a court of competent jurisdiction
shall direct.
(c) In
the
event that the proceeds of any such sale, collection or realization are
insufficient to pay all amounts to which the Collateral Agent and the Holders
are legally entitled, the Company shall be liable for the deficiency, together
with interest thereon at the highest rate specified in any of the applicable
Transaction Documents for interest on overdue principal thereof or such other
rate as shall be fixed by applicable law, together with the costs of collection
and the reasonable fees, costs, expenses and other client charges of any
attorneys employed by the Collateral Agent to collect such
deficiency.
(d) The
Company hereby acknowledges that if the Collateral Agent complies with any
applicable state, provincial, or federal law requirements in connection with
a
disposition of the Collateral, such compliance will not adversely affect the
commercial reasonableness of any sale or other disposition of the
Collateral.
(e) The
Collateral Agent shall not be required to marshal any present or future
collateral security (including, but not limited to, this Agreement and the
Collateral) for, or other assurances of payment of, the Obligations or any
of
them or to resort to such collateral security or other assurances of payment
in
any particular order, and all of the Collateral Agent's rights hereunder and
in
respect of such collateral security and other assurances of payment shall be
cumulative and in addition to all other rights, however existing or arising.
To
the extent that the Company lawfully may, the Company hereby agrees that it
will
not invoke any law relating to the marshalling of collateral which might cause
delay in or impede the enforcement of the Collateral Agent's rights under this
Agreement or under any other instrument creating or evidencing any of the
Obligations or under which any of the Obligations is outstanding or by which
any
of the Obligations is secured or payment thereof is otherwise assured, and,
to
the extent that it lawfully may, the Company hereby irrevocably waives the
benefits of all such laws.
SECTION
8. Indemnity
and Expenses.
(a) The
Company agrees, jointly and severally, to defend, protect, indemnify and hold
the Collateral Agent, the Trustee and each of the Holders, jointly and
severally, harmless from and against any and all claims, damages, losses,
liabilities, obligations, penalties, fees, costs and expenses (including,
without limitation, reasonable legal fees, costs, expenses, and disbursements
of
such Person's counsel) to the extent that they arise out of or otherwise result
from this Agreement (including, without limitation, enforcement of this
Agreement), except claims, losses or liabilities resulting solely and directly
from such Person's own gross negligence or willful misconduct, as determined
by
a final judgment of a court of competent jurisdiction.
(b) The
Company agrees, jointly and severally, to upon demand pay to the Collateral
Agent the amount of any and all costs and expenses, including the reasonable
fees, costs, expenses and disbursements of counsel for the Collateral Agent
and
of any experts and agents (including, without limitation, any collateral trustee
which may act as agent of the Collateral Agent), which the Collateral Agent
may
incur in connection with (i) the preparation, negotiation, execution,
delivery, recordation, administration, amendment, waiver or other modification
or termination of this Agreement, (ii) the custody, preservation, use or
operation of, or the sale of, collection from, or other realization upon, any
Collateral, (iii) the exercise or enforcement of any of the rights of the
Collateral Agent hereunder, or (iv) the failure by the Company to perform
or observe any of the provisions hereof.
SECTION
9. Notices,
Etc.
All
notices and other communications provided for hereunder shall be in writing
and
shall be mailed (by certified mail, postage prepaid and return receipt
requested), telecopied or delivered, if to the Company at its address specified
below and if to the Collateral Agent to it, at its address specified below;
or
as to any such Person, at such other address as shall be designated by such
Person in a written notice to such other Person complying as to delivery with
the terms of this Section
9.
All
such notices and other communications shall be effective if sent by certified
mail, return receipt requested, when received.
SECTION
10. Miscellaneous.
(a) No
amendment of any provision of this Agreement shall be effective unless it is
in
writing and signed by the Company and the Collateral Agent, and no waiver of
any
provision of this Agreement, and no consent to any departure by the Company
therefrom, shall be effective unless it is in writing and signed by the
Collateral Agent, and then such waiver or consent shall be effective only in
the
specific instance and for the specific purpose for which given.
(b) No
failure on the part of the Collateral Agent to exercise, and no delay in
exercising, any right hereunder or under any of the other Transaction Documents
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. The rights and remedies of the Collateral Agent or any Holder
provided herein and in the other Transaction Documents are cumulative and are
in
addition to, and not exclusive of, any rights or remedies provided by law.
The
rights of the Collateral Agent or any Holder under any of the other Transaction
Documents against any party thereto are not conditional or contingent on any
attempt by such Person to exercise any of its rights under any of the other
Transaction Documents against such party or against any other Person, including
but not limited to, the Company.
(c) All
rights of the Collateral Agent hereunder, the security interest created hereby
and all obligations of the Company hereunder shall be absolute and unconditional
irrespective of (a) any lack of validity or enforceability of any Transaction
Document, any agreement with respect to any of the Obligations or any other
agreement or instrument relating to any of the foregoing, (b) any change in
the
time, manner or place of payment of, or in any other term of, all or any of
the
Obligations, or any other amendment or waiver of or any consent to any departure
from any Transaction Document or any other agreement or instrument, (c) any
exchange, release or non-perfection of any Lien on other collateral, or any
release or amendment or waiver of or consent under or departure from any
guarantee, securing or guaranteeing all or any of the Obligations, or (d) any
other circumstance that might otherwise constitute a defense available to,
or a
discharge of, the Company in respect of the Obligations or this
Agreement.
(d) Any
provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining portions
hereof or thereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
(e) This
Agreement shall create a continuing security interest in the Collateral and
shall (i) remain in full force and effect until the indefeasible payment in
full
in cash of the Obligations, and (ii) be binding on the Company and all other
Persons who become bound as debtor to this Agreement in accordance with Section
9-203(d) of the Code and shall inure, together with all rights and remedies
of
the Collateral Agent and the Holders hereunder, to the benefit of the Collateral
Agent and the Holders and their respective permitted successors, transferees
and
assigns. Without limiting the generality of clause (ii) of the immediately
preceding sentence, without notice to the Company, the Collateral Agent and
the
Holders may assign or otherwise transfer their rights and obligations under
this
Agreement and any of the other Transaction Documents to any other Person
(subject to the terms of the Indenture and the other Transaction Documents)
and
such other Person shall thereupon become vested with all of the benefits in
respect thereof granted to the Collateral Agent and the Holders herein or
otherwise. Upon any such assignment or transfer, all references in this
Agreement to the Collateral Agent or any such Holder shall mean the assignee
of
the Collateral Agent or such Holder. None of the rights or obligations of the
Company hereunder may be assigned or otherwise transferred and any such
assignment or transfer without the consent of the Collateral
Agent
shall be null and void.
(f) Upon
the
indefeasible payment in full in cash of the Obligations, (i) this Agreement
and
the security interests created hereby shall terminate and all rights to the
Collateral shall revert to the Company that granted such security interests
hereunder, and (ii) the Collateral Agent will, upon the Company's request and
at
the Company's expense, (A) return to the Company such of the Collateral as
shall
not have been sold or otherwise disposed of or applied pursuant to the terms
hereof, and (B) execute and deliver to the Company such documents as the Company
shall reasonably request to evidence such termination, all without any
representation, warranty or recourse whatsoever.
(g) THIS
AGREEMENT SHALL BE GOVERNED BY, CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE
LAWS OF THE STATE OF NEW YORK, EXCEPT AS REQUIRED BY MANDATORY PROVISIONS OF
LAW
AND EXCEPT TO THE EXTENT THAT THE VALIDITY AND PERFECTION OR THE PERFECTION
AND
THE EFFECT OF PERFECTION OR NON-PERFECTION OF THE SECURITY INTEREST CREATED
HEREBY, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE
GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN THE STATE OF NEW
YORK.
(h) ANY
LEGAL
ACTION, SUIT OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY DOCUMENT
RELATED THERETO MAY BE BROUGHT IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX IN THE
COUNTY OF NEW YORK OR THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT
OF
NEW YORK, AND APPELLATE COURTS THEREOF, AND, BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, THE COMPANY HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. THE
COMPANY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY LAW, ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE
LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS,
WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION, SUIT OR
PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS AND CONSENTS TO THE GRANTING OF
SUCH
LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE COURT.
(i) THE
COMPANY AND (BY ITS ACCEPTANCE OF THE BENEFITS OF THIS AGREEMENT) THE COLLATERAL
AGENT WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN RESPECT OF ANY LITIGATION
BASED ON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY
OF
THE OTHER TRANSACTION DOCUMENTS, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
VERBAL OR WRITTEN STATEMENT OR OTHER ACTION OF THE PARTIES HERETO.
(j) The
Company irrevocably consents to the service of process of any of the aforesaid
courts in any such action, suit or proceeding by the mailing of copies thereof
by registered or certified mail (or any substantially similar form of mail),
postage prepaid, to the Company at its address provided herein, such service
to
become effective ten (10) days after such mailing.
(k) Nothing
contained herein shall affect the right of the Collateral Agent to serve process
in any other manner permitted by law or commence legal proceedings or otherwise
proceed against the Company or any property of the Company in any other
jurisdiction.
(l) The
Company irrevocably and unconditionally waives any right it may have to claim
or
recover in any legal action, suit or proceeding referred to in this Section
any
special, exemplary, punitive or consequential damages.
(m) Section
headings herein are included for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.
(n) This
Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which shall be deemed to be an
original, but all of which taken together constitute one in the same
Agreement.
(o) In
connection with its appointment and acting hereunder, the Collateral Agent
is
entitled to all rights, privileges, protections, benefits, immunities and
indemnities provided to it as Trustee under the Indenture. The Holders hereby
authorize and direct the Collateral Agent to enter into this
Agreement.
(p) In
no
event shall the Collateral Agent be responsible or liable for any failure or
delay in the performance of its obligations hereunder arising out of or caused
by, directly or indirectly, forces beyond its control, including without
limitation strikes, work stoppages, accidents, acts of war or terrorism, civil
or military disturbances, nuclear or natural catastrophes or acts of god, and
interruptions, loss or malfunctions of utilities, communications or computer
(software and hardware) services; it being understood that the Collateral Agent
shall use reasonable efforts which are consistent with accepted practices in
the
banking industry to resume performance as soon as practicable under the
circumstances.
[REMAINDER
OF THIS PAGE INTENTIONALLY LEFT BLANK]
ny-726410
v6
IN
WITNESS WHEREOF, the Company has caused this Agreement to be executed and
delivered by its officer thereunto duly authorized, as of the date first above
written.
THE
COMPANY:
By: /s/
Xxxxxxx Xxxxx
Name:
Xxxxxxx Xxxxx
Title:
Chief Financial Officer
ACCEPTED
BY:
THE
BANK
OF NEW YORK, as
Collateral Agent
By: /s/
Xxxxxxxx Xxxxxx
Name:
Xxxxxxxx Xxxxxx
Title:
Vice President
Address:
000 Xxxxxxx Xxxxxx, 0X
Xxx
Xxxx,
XX 00000
SCHEDULE
I
LEGAL
NAME; ORGANIZATIONAL IDENTIFICATION NUMBER; STATE OR JURISDICTION OF
ORGANIZATION
|
Sched.
I-
|
ny-726410
v6
SCHEDULE
II
THE
COMPANY
INTELLECTUAL
PROPERTY AND LICENSES
|
Sched.
II-
|
ny-726410
v6
SCHEDULE
III
LOCATIONS
OF THE COMPANY
LOCATION Description
of Location (State if Location
(i) contains
Rolling Stock, other Equipment, Fixtures,
Goods
or
Inventory,
(ii)
is
chief place of business and
chief
executive office, or
(iii)
contains Records concerning Accounts
and
originals
of
Chattel Paper)
|
Sched.
III-
|
ny-726410
v6
SCHEDULE
IV
PROMISSORY
NOTES, SECURITIES, DEPOSIT
ACCOUNTS, SECURITIES ACCOUNTS AND COMMODITIES ACCOUNTS
THE
COMPANY
Promissory
Notes:
Securities
and Other Instruments:
Name
and
Address
of
Institution
Maintaining
Account Account
Number Type
of Account
|
Sched.
IV-
|
ny-726410
v6
SCHEDULE
V
THE
COMPANY
UCC-1
FINANCING STATEMENTS
|
Sched.
V-
|
ny-726410
v6
SCHEDULE
VI
THE
COMPANY
COMMERCIAL
TORT CLAIMS
|
Sched.
VI-
|
ny-726410
v6
EXHIBIT
A
ASSIGNMENT
FOR SECURITY
[TRADEMARKS]
[PATENTS] [COPYRIGHTS]
WHEREAS,
______________________________
(the
"Assignor")
[has
adopted, used and is using, and holds all right, title and interest in and
to,
the trademarks and service marks listed on the annexed Schedule 1A,
which
trademarks and service marks are registered or applied for in the United States
Patent and Trademark Office (the "Trademarks")]
[holds all right, title and interest in the letter patents, design patents
and
utility patents listed on the annexed Schedule 1A,
which
patents are issued or applied for in the United States Patent and Trademark
Office (the "Patents")]
[holds all right, title and interest in the copyrights listed on the annexed
Schedule
1A,
which
copyrights are registered in the United States Copyright Office (the
"Copyrights")];
WHEREAS,
the Assignor has entered into a Security Agreement, dated as of
________________, 2006 (as amended, restated or otherwise modified from time
to
time the "Security
Agreement"),
in
favor of THE BANK OF NEW YORK, as collateral agent for certain purchasers (the
"Assignee");
WHEREAS,
pursuant to the Security Agreement, the Assignor has assigned to the Assignee
and granted to the Assignee for the benefit of the Holders (as defined in the
Security Agreement) a continuing security interest in all right, title and
interest of the Assignor in, to and under the [Trademarks, together with, among
other things, the good-will of the business symbolized by the Trademarks]
[Patents] [Copyrights] and the applications and registrations thereof, and
all
proceeds thereof, including, without limitation, any and all causes of action
which may exist by reason of infringement thereof and any and all damages
arising from past, present and future violations thereof (the "Collateral"),
to
secure the payment, performance and observance of the "Obligations" (as defined
in the Security Agreement);
NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency
of
which are hereby acknowledged, the Assignor does hereby pledge, convey, sell,
assign, transfer and set over unto the Assignee and grants to the Assignee
for
the benefit of the Holders a continuing security interest in the Collateral
to
secure the prompt payment and performance of the Obligations.
The
Assignor does hereby further acknowledge and affirm that the rights and remedies
of the Assignee with respect to the Collateral are more fully set forth in
the
Security Agreement, the terms and provisions of which are hereby incorporated
herein by reference as if fully set forth herein.
IN
WITNESS WHEREOF, the Assignor has caused this Assignment to be duly executed
by
its officer thereunto duly authorized as of _____________, 20__
[THE
COMPANY]
By:____________________________
Name:
Title:
|
Xxx.
X-
|
xx-000000
v6
STATE
OF
____________
ss.:
COUNTY
OF
__________
On
this
____ day of _______________, 20__, before me personally came ________________,
to me known to be the person who executed the foregoing instrument, and who,
being duly sworn by me, did depose and say that s/he is the ________________
of
_______________________________________, a ____________________, and that s/he
executed the foregoing instrument in the firm name of
_______________________________________, and that s/he had authority to sign
the
same, and s/he acknowledged to me that he executed the same as the act and
deed
of said firm for the uses and purposes therein mentioned.
|
Exh.
A-
|
ny-726410
v6
SCHEDULE
1A TO ASSIGNMENT FOR SECURITY
[Trademarks
and Trademark Applications]
[Patent
and Patent Applications]
[Copyright
and Copyright Applications]
Owned
by
______________________________
