Exhibit 99.2
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SECOND AMENDED AND RESTATED SECURITY AGREEMENT
Dated as of April 23, 2001
as amended and restated as of October 15, 2002
and as further amended and restated as of September 24, 2004
made by
WILTEL COMMUNICATIONS, LLC,
WILTEL COMMUNICATIONS GROUP, INC.,
and
THE OTHER GRANTORS referred to herein
in favor of
CREDIT SUISSE FIRST BOSTON,
acting through its Cayman Islands branch,
as Administrative Agent, as First Lien Administrative Agent
and as Second Lien Administrative Agent
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Table of Contents
Page
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Section 1. DEFINED TERMS...................................................................................2
1.1 Definitions.....................................................................................2
1.2 Other Definitional Provisions...................................................................4
Section 2. GRANT OF SECURITY INTEREST TO THE FIRST LIEN ADMINISTRATIVE AGENT...............................5
Section 3. GRANT OF SECURITY INTEREST TO THE SECOND LIEN ADMINISTRATIVE AGENT..............................6
Section 4. REPRESENTATIONS AND WARRANTIES..................................................................7
4.1 Title; No Other Liens...........................................................................8
4.2 Perfected Liens.................................................................................8
4.3 Jurisdiction of Organization; Chief Executive Office............................................8
4.4 Inventory and Equipment.........................................................................9
4.5 Farm Products...................................................................................9
4.6 Investment Property.............................................................................9
4.7 Investment Accounts.............................................................................9
4.8 Receivables....................................................................................10
4.9 Intellectual Property..........................................................................10
Section 5. FIRST LIEN COVENANTS...........................................................................10
5.1 Delivery of Instruments, Certificated Securities and Chattel Paper.............................10
5.2 Maintenance of Insurance.......................................................................10
5.3 Payment of Obligations.........................................................................11
5.4 Maintenance of Perfected Security Interest; Further Documentation..............................11
5.5 Changes in Locations, Name, etc................................................................12
5.6 Notices........................................................................................12
5.7 Investment Property............................................................................12
5.8 Investment Accounts............................................................................13
5.9 Receivables....................................................................................13
5.10 Intellectual Property..........................................................................14
5.11 Section 5 for the Exclusive Benefit of the First Lien Administrative Agent
and the other First Lien Secured Parties.......................................................15
Section 6. SECOND LIEN COVENANTS..........................................................................15
6.1 Delivery of Instruments, Certificated Securities and Chattel Paper.............................15
6.2 Maintenance of Insurance.......................................................................15
6.3 Payment of Obligations.........................................................................15
6.4 Maintenance of Perfected Security Interest; Further Documentation..............................16
6.5 Changes in Locations, Name, etc................................................................16
6.6 Notices........................................................................................16
6.7 Investment Property............................................................................17
6.8 Investment Accounts............................................................................18
6.9 Receivables....................................................................................18
6.10 Intellectual Property..........................................................................18
6.11 Section 6 for the Exclusive Benefit of the Second Lien Administrative
Agent and the other Second Lien Secured Parties................................................19
6.12 Delivery of Collateral.........................................................................19
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Section 7. FIRST LIEN ADMINISTRATIVE AGENT REMEDIAL PROVISIONS............................................19
7.1 Certain Matters Relating to Receivables........................................................19
7.2 Communications with Obligors; Grantors Remain Liable...........................................20
7.3 Investment Property............................................................................20
7.4 Proceeds to be Turned Over To First Lien Administrative Agent..................................21
7.5 Application of Proceeds........................................................................22
7.6 Code and Other Remedies........................................................................22
7.7 Registration Rights............................................................................23
7.8 Deficiency.....................................................................................24
7.9 Section 7 for the Exclusive Benefit of the First Lien Administrative
Agent and the other First Lien Secured Parties.................................................24
Section 8. SECOND LIEN ADMINISTRATIVE AGENT REMEDIAL PROVISIONS...........................................24
8.1 Certain Matters Relating to Receivables........................................................24
8.2 Communications with Obligors; Grantors Remain Liable...........................................25
8.3 Investment Property............................................................................25
8.4 Proceeds to be Turned Over To Second Lien Administrative Agent.................................26
8.5 Application of Proceeds........................................................................27
8.6 Code and Other Remedies........................................................................27
8.7 Registration Rights............................................................................28
8.8 Deficiency.....................................................................................29
8.9 Section 8 for the Exclusive Benefit of the Second Lien Administrative
Agent and the other Second Lien Secured Parties................................................29
Section 9. THE FIRST LIEN ADMINISTRATIVE AGENT............................................................29
9.1 First Lien Administrative Agent's Appointment as Attorney-in-Fact, etc.........................29
9.2 Duty of First Lien Administrative Agent........................................................31
9.3 Execution of Financing Statements..............................................................31
9.4 Authority of First Lien Administrative Agent...................................................31
9.5 Intercreditor Provisions.......................................................................31
Section 10. THE SECOND LIEN ADMINISTRATIVE AGENT...........................................................32
10.1 Second Lien Administrative Agent's Appointment as Attorney-in-Fact, etc........................32
10.2 Duty of Second Lien Administrative Agent.......................................................33
10.3 Execution of Financing Statements..............................................................34
10.4 Authority of Second Lien Administrative Agent..................................................34
10.5 Intercreditor Provisions.......................................................................34
Section 11. MISCELLANEOUS..................................................................................34
11.1 Amendments in Writing..........................................................................34
11.2 Notices........................................................................................34
11.3 No Waiver by Course of Conduct; Cumulative Remedies............................................34
11.4 Enforcement Expenses; Indemnification..........................................................35
11.5 Successors and Assigns.........................................................................35
11.6 Set-Off........................................................................................35
11.7 Counterparts...................................................................................36
11.8 Severability...................................................................................36
11.9 Section Headings...............................................................................36
11.10 Integration....................................................................................36
11.11 GOVERNING LAW..................................................................................36
11.12 Submission To Jurisdiction; Waivers............................................................36
11.13 Acknowledgements...............................................................................36
11.14 Additional Grantors............................................................................37
11.15 Releases.......................................................................................37
11.16 WAIVER OF JURY TRIAL...........................................................................38
11.17 No Novation....................................................................................38
SCHEDULES
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Schedule 1 Notice Addresses
Schedule 2 Investment Property
Schedule 3 Perfection Matters
Schedule 4 Jurisdictions of Organization and Chief Executive Offices
Schedule 5 Equipment and Material Inventory Locations
Schedule 6 Intellectual Property
Schedule 7 Excluded Deposit Accounts
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SECOND AMENDED AND RESTATED SECURITY AGREEMENT (this "Agreement"),
dated as of April 23, 2001, as amended and restated as of October 15, 2002, and
as further amended and restated as of September 24, 2004, made by each of the
signatories hereto (together with any other entity that may become a party
hereto as provided herein, the "Grantors"), in favor of CREDIT SUISSE FIRST
BOSTON, acting through its Cayman Islands branch, as Administrative Agent, as
First Lien Administrative Agent and as Second Lien Administrative Agent
(collectively, and together with its successors, in such capacities, the
"Agent") for the banks and other financial institutions or entities (the
"Lenders") from time to time parties to the Third Amended and Restated Credit
Agreement, dated as of September 8, 1999, as amended and restated as of April
25, 2001, as further amended and restated as of October 15, 2002, and as further
amended and restated as of September 24, 2004 (as further amended, amended and
restated, supplemented, restructured or otherwise modified, renewed or replaced
from time to time, the "Credit Agreement"), among WILTEL COMMUNICATIONS, LLC, a
Delaware limited liability company (the "Borrower"), the other Grantors party
thereto, the Lenders, CREDIT SUISSE FIRST BOSTON, acting through its Cayman
Islands branch, as Administrative Agent, as First Lien Administrative Agent and
as Second Lien Administrative Agent and XXXXX FARGO FOOTHILL, LLC, as
Syndication Agent.
INTRODUCTORY STATEMENT
WHEREAS, the Grantors and certain other signatories thereto have
entered into an Amended and Restated Security Agreement, dated as of April 23,
2001, as amended and restated as of October 15, 2002 (the "Existing Security
Agreement"), in favor of Bank of America, N.A., as administrative agent (in such
capacity, the "Predecessor Administrative Agent");
WHEREAS, pursuant to the Credit Agreement the Predecessor
Administrative Agent under the Existing Security Agreement has been replaced by
the Agent as agent for the applicable Secured Parties under this Agreement and
the other Loan Documents;
WHEREAS, the Borrower is a member of an affiliated group of companies
that includes each other Grantor;
WHEREAS, the proceeds of the extensions of credit under the Credit
Agreement have been and will continue to be used in part to enable the Borrower
to make valuable transfers to one or more of the other Grantors in connection
with the operation of their respective businesses;
WHEREAS, certain of the Qualified Counterparties may enter into
Specified Swap Agreements with the Borrower;
WHEREAS, the Borrower and the other Grantors are engaged in related
businesses, and each Grantor derives substantial direct and indirect benefit
from the extensions of credit under the Credit Agreement and from the Specified
Swap Agreements;
WHEREAS, it is a condition precedent to the Restatement Effective
Date that the Grantors shall have executed and delivered this Agreement (a) to
the First Lien Administrative Agent for the ratable benefit of the First Lien
Secured Parties and (b) to the Second Lien Administrative Agent for the ratable
benefit of the Second Lien Secured Parties;
WHEREAS, the parties hereto have agreed to amend and restate the
Existing Security Agreement as provided in this Agreement; and
WHEREAS, it is the intent of the parties hereto that this Agreement
not constitute a novation of the obligations and liabilities of the Grantors
existing under the Existing Security Agreement or evidence satisfaction of any
of such obligations and that this Agreement amend and restate in its entirety
the Existing Security Agreement and re-evidence the obligations of the Grantors
outstanding thereunder.
NOW, THEREFORE, in consideration of the above premises, the parties
hereto hereby agree that on the Restatement Effective Date, the Existing
Security Agreement shall be amended and restated in its entirety as follows:
Section 1. DEFINED TERMS
1.1 Definitions. (a). Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement, and the following terms are used herein as defined in the
New York UCC: Accounts, Certificated Security, Chattel Paper, Commercial Tort
Claims, Commodities Accounts, Documents, Equipment, Farm Products, General
Intangibles, Goods, Instruments, Inventory, Letter-of-Credit Rights and
Securities Accounts and Supporting Obligations.
(b) The following terms shall have the following meanings:
"Agreement": as defined in the preamble hereto.
"Borrower Obligations": the collective reference to the First Lien
Obligations of the Borrower and the Second Lien Obligations of the Borrower.
"CG Austria": CG Austria, Inc., a Delaware corporation.
"Collateral": the collective reference to the First Lien Collateral
and the Second Lien Collateral.
"Collateral Account": any collateral account established by the
Administrative Agent as provided in Section 7.1, 7.4, 8.1 or 8.4.
"Collateral Documents": the reference to Security Documents as
defined in the Credit Agreement.
"Copyright Licenses": any written agreement naming any Grantor as
licensor or licensee (including, without limitation, those listed on Schedule
6), granting any right under any Copyright, including, without limitation, the
grant of rights to manufacture, distribute, exploit and sell materials derived
from any Copyright.
"Copyrights": (i) all copyrights arising under the laws of the United
States, any other country or any political subdivision thereof, whether
registered or unregistered and whether published or unpublished (including,
without limitation, those listed on Schedule 6), all registrations and
recordings thereof, and all applications in connection therewith, including,
without limitation, all registrations, recordings and applications in the United
States Copyright Office, and (ii) the right to obtain all renewals thereof.
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"Deposit Account": as defined in the Uniform Commercial Code of any
applicable jurisdiction and, in any event, including, without limitation, any
demand, time, savings, passbook or like account maintained with a depositary
institution.
"Excluded Capital Stock": Capital Stock of Lucent Technologies, Inc.
and Interland, Inc. owned by any Grantor to the extent constituting "margin
stock" within the meaning of such quoted term under Regulation U as now and from
time to time hereafter in effect.
"Existing Security Agreement": as defined in the Introductory
Statement of this Agreement.
"First Lien Collateral": as defined in Section 2.
"Foreign Subsidiary": any direct Subsidiary of any Grantor organized
under the laws of any jurisdiction outside the United States of America.
"Foreign Subsidiary Voting Stock": the voting Capital Stock of any
Foreign Subsidiary.
"Guarantor Obligations": the collective reference to the First Lien
Obligations of Guarantors and the Second Lien Obligations of the Guarantors.
"Intellectual Property": the collective reference to all rights,
priorities and privileges relating to intellectual property of any Grantor,
whether arising under United States, multinational or foreign laws or otherwise,
including, without limitation, the Copyrights, the Copyright Licenses, the
Patents, the Patent Licenses, the Trademarks and the Trademark Licenses, and all
rights to xxx at law or in equity for any infringement or other impairment
thereof, including the right to receive all proceeds and damages therefrom.
"Intercompany Note": any promissory note evidencing loans made by any
Grantor to Holdings or any of its Subsidiaries.
"Investment Accounts": the collective reference to the Securities
Accounts, Commodities Accounts and Deposit Accounts.
"Investment Property": the collective reference to (i) all
"investment property" as such term is defined in Section 9-102(a)(49) of the New
York UCC (other than any Foreign Subsidiary Voting Stock excluded from the
definition of "Pledged Stock") and (ii) whether or not constituting "investment
property" as so defined, all Pledged Notes and all Pledged Stock.
"Issuers": the collective reference to each issuer of any Investment
Property.
"New York UCC": the Uniform Commercial Code as from time to time in
effect in the State of New York.
"Obligations": (i) in the case of the Borrower, the Borrower
Obligations, and (ii) in the case of each Guarantor, its Guarantor Obligations.
"Patent License": all agreements, whether written or oral, providing
for the grant by or to any Grantor of any right to manufacture, use or sell any
invention covered in whole or in part by a Patent, including, without
limitation, any of the foregoing referred to on Schedule 6.
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"Patents": (i) all letters patent of the United States, any other
country or any political subdivision thereof, all reissues and extensions
thereof and all goodwill associated therewith, including, without limitation,
any of the foregoing referred to on Schedule 6, (ii) 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 of the foregoing referred to on Schedule 6, and (iii) all rights to obtain
any reissues or extensions of the foregoing.
"Pledged Notes": all promissory notes listed on Schedule 2, all
Intercompany Notes at any time issued to any Grantor and all other promissory
notes issued to or held by any Grantor.
"Pledged Stock": the shares of Capital Stock listed on Schedule 2,
together with any other shares, stock certificates, options, interests or rights
of any nature whatsoever in respect of the Capital Stock of any Person that may
be issued or granted to, or held by, any Grantor while this Agreement is in
effect; provided that in no event shall more than 65% of the total outstanding
Foreign Subsidiary Voting Stock of any Foreign Subsidiary be required to be
pledged hereunder.
"Predecessor Administrative Agent": as defined in the Introductory
Statement of this Agreement.
"Proceeds": all "proceeds" as such term is defined in Section
9-102(a)(64) of the New York UCC and, in any event, shall include, without
limitation, all dividends or other income from the Investment Property,
collections thereon or distributions or payments with respect thereto.
"Receivable": any right to payment for goods sold or leased or for
services rendered, whether or not such right is evidenced by an Instrument or
Chattel Paper and whether or not it has been earned by performance (including,
without limitation, any Account).
"Second Lien Collateral": as defined in Section 3.
"Securities Act": the Securities Act of 1933, as amended.
"Trademark License": any agreement, whether written or oral,
providing for the grant by or to any Grantor of any right to use any Trademark,
including, without limitation, any of the foregoing referred to on Schedule 6.
"Trademarks": (i) 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 all 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, and all common-law
rights related thereto, including, without limitation, any of the foregoing
referred to on Schedule 6, and (ii) the right to obtain all renewals thereof.
1.2 Other Definitional Provisions. (a) The words "hereof," "herein",
"hereto" and "hereunder" and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Section and Schedule references are to the Sections and
Schedules of this Agreement unless otherwise specified.
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
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(c) Where the context requires, terms relating to the Collateral or
any part thereof, when used in relation to a Grantor, shall refer to such
Grantor's Collateral or the relevant part thereof.
Section 2. GRANT OF SECURITY INTEREST TO THE FIRST LIEN ADMINISTRATIVE AGENT
Each Grantor hereby grants to the First Lien Administrative Agent,
for the ratable benefit of the First Lien Secured Parties, a security interest
in, and assigns and transfers to the First Lien Administrative Agent all of the
following property now owned or at any time hereafter acquired by such Grantor
or in which such Grantor now has or at any time in the future may acquire any
right, title or interest (collectively, the "First Lien Collateral"), as
collateral security for the prompt and complete payment and performance when due
(whether at the stated maturity, by acceleration or otherwise) of such Grantor's
First Lien Obligations:
(a) all Accounts;
(b) all Chattel Paper;
(c) all Contracts;
(d) all Deposit Accounts;
(e) all Documents; (f) all Equipment;
(g) all General Intangibles;
(h) all Goods;
(i) all Instruments;
(j) all Intellectual Property;
(k) all Inventory;
(l) all Investment Property;
(m) all Letter-of-Credit Rights;
(n) all other property not otherwise described above;
(o) all books and records pertaining to the First Lien Collateral;
and
(p) to the extent not otherwise included, all Proceeds, Supporting
Obligations and products of any and all of the foregoing and all collateral
security and guarantees given by any Person with respect to any of the
foregoing;
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provided, however, that notwithstanding any of the other provisions
set forth in this Section 2, this Agreement shall not constitute a grant of a
security interest in (a) any Excluded Capital Stock (to the extent the pledge
thereof would require "nonbank lenders" to file a "Form FRG-1" or a "Form FRG-4"
(as such quoted terms are used in Regulation U as now and from time to time
hereafter in effect)) or (b) any property to the extent that such grant of a
security interest is prohibited by any Requirement of Law of a Governmental
Authority, requires a consent not obtained of any Governmental Authority
pursuant to such Requirement of Law or is prohibited by, or constitutes a breach
or default under or results in the termination of or requires any consent not
obtained under, any contract, license, agreement, instrument or other document
evidencing or giving rise to such property, except (i) to the extent that the
terms in such contract, license, instrument or other document providing for such
prohibition, breach, default or termination, or requiring such consent are not
permitted under Section 8.14 of the Credit Agreement or (ii) to the extent that
such Requirement of Law or the term in such contract, license, agreement,
instrument or other document providing for such prohibition, breach, default or
termination or requiring such consent is ineffective under Section 9-406, 9-407,
9-408 or 9-409 of the UCC (or any successor provision or provisions) of any
relevant jurisdiction or any other applicable law (including the Bankruptcy
Code) or principles of equity; provided, however, that such security interest
shall attach immediately at such time as such Requirement of Law is not
effective or applicable, or any such consent is obtained, or such prohibition,
breach, default or termination is no longer applicable or is waived, and to the
extent severable, shall attach immediately to any portion of the First Lien
Collateral that does not result in such consequences; and provided, further,
that no United States intent-to-use trademark or service xxxx application shall
be included in the First Lien Collateral to the extent that, and solely during
the period in which, the grant of a security interest therein would impair the
validity or enforceability of such intent-to-use trademark or service xxxx
application under Federal law. After such period, each Grantor acknowledges that
such interest in such trademark or service xxxx application shall be subject to
a security interest in favor of the First Lien Administrative Agent and shall be
included in the First Lien Collateral.
Section 3. GRANT OF SECURITY INTEREST TO THE SECOND LIEN ADMINISTRATIVE AGENT
Each Grantor hereby grants to the Second Lien Administrative Agent,
for the ratable benefit of the Second Lien Secured Parties, a security interest
in, and assigns and transfers to the Second Lien Administrative Agent all of the
following property now owned or at any time hereafter acquired by such Grantor
or in which such Grantor now has or at any time in the future may acquire any
right, title or interest (collectively, the "Second Lien Collateral"), as
collateral security for the prompt and complete payment and performance when due
(whether at the stated maturity, by acceleration or otherwise) of such Grantor's
Second Lien Obligations:
(a) all Accounts;
(b) all Chattel Paper;
(c) all Contracts;
(d) all Deposit Accounts;
(e) all Documents;
(f) all Equipment;
(g) all General Intangibles;
(h) all Goods;
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(i) all Instruments;
(j) all Intellectual Property;
(k) all Inventory;
(l) all Investment Property;
(m) all Letter-of-Credit Rights;
(n) all other property not otherwise described above;
(o) all books and records pertaining to the Second Lien Collateral;
and
(p) to the extent not otherwise included, all Proceeds, Supporting
Obligations and products of any and all of the foregoing and all collateral
security and guarantees given by any Person with respect to any of the
foregoing;
provided, however, that notwithstanding any of the other provisions
set forth in this Section 3, this Agreement shall not constitute a grant of a
security interest in (a) any Excluded Capital Stock (to the extent the pledge
thereof would require "nonbank lenders" to file a "Form FRG-1" or a "Form FRG-4"
(as such quoted terms are used in Regulation U as now and from time to time
hereafter in effect)) or (b) any property to the extent that such grant of a
security interest is prohibited by any Requirement of Law of a Governmental
Authority, requires a consent not obtained of any Governmental Authority
pursuant to such Requirement of Law or is prohibited by, or constitutes a breach
or default under or results in the termination of or requires any consent not
obtained under, any contract, license, agreement, instrument or other document
evidencing or giving rise to such property, except (i) to the extent that the
terms in such contract, license, instrument or other document providing for such
prohibition, breach, default or termination, or requiring such consent are not
permitted under Section 8.14 of the Credit Agreement or (ii) to the extent that
such Requirement of Law or the term in such contract, license, agreement,
instrument or other document providing for such prohibition, breach, default or
termination or requiring such consent is ineffective under Section 9-406, 9-407,
9-408 or 9-409 of the UCC (or any successor provision or provisions) of any
relevant jurisdiction or any other applicable law (including the Bankruptcy
Code) or principles of equity; provided, however, that such security interest
shall attach immediately at such time as such Requirement of Law is not
effective or applicable, or any such consent is obtained, or such prohibition,
breach, default or termination is no longer applicable or is waived, and to the
extent severable, shall attach immediately to any portion of the Second Lien
Collateral that does not result in such consequences; and provided, further,
that no United States intent-to-use trademark or service xxxx application shall
be included in the Second Lien Collateral to the extent that, and solely during
the period in which, the grant of a security interest therein would impair the
validity or enforceability of such intent-to-use trademark or service xxxx
application under Federal law. After such period, each Grantor acknowledges that
such interest in such trademark or service xxxx application shall be subject to
a security interest in favor of the Second Lien Administrative Agent and shall
be included in the Second Lien Collateral.
Section 4. REPRESENTATIONS AND WARRANTIES
To induce each Agent and the Lenders to enter into the Credit
Agreement and to induce the Lenders to make their respective extensions of
credit to the Borrower thereunder, each Grantor hereby represents and warrants
to each Agent and each other Secured Party that:
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4.1 Title; No Other Liens. Except for (a) the security interests
granted to the First Lien Administrative Agent for the ratable benefit of the
First Lien Secured Parties, (b) the security interests granted to the Second
Lien Administrative Agent for the ratable benefit of the Second Lien Secured
Parties pursuant to this Agreement and (c) the other Liens permitted to exist on
the Collateral by the Credit Agreement, such Grantor owns each item of the
Collateral free and clear of any and all Liens or claims of others. No financing
statement or other public notice with respect to all or any part of the
Collateral is on file or of record or will be filed in any public office, except
such as have been filed (i) in favor of the Administrative Agent, for the
ratable benefit of the Secured Parties, (ii) in favor of the First Lien
Administrative Agent, for the ratable benefit of the First Lien Secured Parties,
(iii) in favor of the Second Lien Administrative Agent, for the ratable benefit
of the Second Lien Secured Parties, pursuant to this Agreement, (iv) in favor of
the Predecessor Administrative Agent, or (v) as are permitted by the Credit
Agreement. For the avoidance of doubt, it is understood and agreed that any
Grantor may, as part of its business, grant licenses to third parties to use
Intellectual Property owned or developed by a Grantor. For purposes of this
Agreement and the other Loan Documents, such licensing activity shall not
constitute a "Lien" on such Intellectual Property. Each Agent and each other
Secured Party understands that any such licenses may be exclusive to the
applicable licensees, and such exclusivity provisions may limit the ability of
any Agent to utilize, sell, lease or transfer the related Intellectual Property
or otherwise realize value from such Intellectual Property pursuant hereto.
4.2 Perfected Liens. (a) The security interests granted to the First
Lien Administrative Agent pursuant to this Agreement (i) upon completion of the
filings and other actions specified on Schedule 3 (which, in the case of all
filings and other documents referred to on said Schedule, have been delivered to
the Administrative Agent in completed and duly executed form) will constitute
valid perfected security interests (to the extent perfection may be effected by
filing a financing statement) in all of the First Lien Collateral in favor of
the First Lien Administrative Agent, for the ratable benefit of the First Lien
Secured Parties, as collateral security for such Grantor's First Lien
Obligations, enforceable in accordance with the terms hereof against all
creditors of such Grantor and any Persons purporting to purchase any First Lien
Collateral from such Grantor and (ii) are prior to all other Liens on the First
Lien Collateral in existence on the date hereof except for unrecorded Liens
permitted by the Credit Agreement which have priority over the Liens on the
First Lien Collateral by operation of law, and in the case of Collateral other
than Pledged Stock, Liens permitted by Section 8.3 and Section 9.3 of the Credit
Agreement.
(b) The security interests granted to the Second Lien Administrative
Agent pursuant to this Agreement (i) upon completion of the filings and other
actions specified on Schedule 3 (which, in the case of all filings and other
documents referred to on said Schedule, have been delivered to the
Administrative Agent in completed and duly executed form) will constitute valid
perfected security interests (to the extent perfection may be effected by filing
a financing statement) in all of the Second Lien Collateral in favor of the
Second Lien Administrative Agent, for the ratable benefit of the Second Lien
Secured Parties, as collateral security for such Grantor's Second Lien
Obligations, enforceable in accordance with the terms hereof against all
creditors of such Grantor and any Persons purporting to purchase any Second Lien
Collateral from such Grantor and (ii) are prior to all other Liens on the Second
Lien Collateral in existence on the date hereof except for (x) Liens securing
the First Lien Obligations and (y) unrecorded Liens permitted by the Credit
Agreement which have priority over the Liens on the Second Lien Collateral by
operation of law, and in the case of Collateral other than Pledged Stock, Liens
permitted by Section 8.3 and Section 9.3 of the Credit Agreement.
4.3 Jurisdiction of Organization; Chief Executive Office. On the date
hereof, such Grantor's jurisdiction of organization, identification number from
the jurisdiction of organization (if any), and the location of such Grantor's
chief executive office or sole place of business, as the case may be, are
specified on Schedule 4. Such Grantor has furnished to the Administrative Agent
a certified charter, certificate of incorporation or other organization document
and long-form good standing certificate as of a date which is recent to the date
hereof.
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4.4 Inventory and Equipment. On the date hereof (a) no Grantor owns
any material Inventory, other than dark fiber located on the fiber optic
communications networks of the Grantors and (b) the Equipment (other than mobile
goods and goods leased or held by third parties) is kept at the locations listed
on Schedule 5.
4.5 Farm Products. None of the Collateral constitutes, or is the
Proceeds of, Farm Products.
4.6 Investment Property. (a) The shares of Pledged Stock pledged by
such Grantor hereunder constitute all the issued and outstanding shares of all
classes of the Capital Stock of each Issuer owned by such Grantor or, in the
case of Foreign Subsidiary Voting Stock, if less, 65% of the outstanding Foreign
Subsidiary Voting Stock of each relevant Issuer.
(b) All the shares of the Pledged Stock of each Subsidiary of such
Grantor have been duly and validly issued and are fully paid and nonassessable.
(c) Such Grantor is the record and beneficial owner of, and has title
to, the Pledged Stock and Pledged Notes pledged by it hereunder, free of any and
all Liens or options in favor of, or adverse claims of, any other Person, except
the security interests created by this Agreement.
4.7 Investment Accounts. (a) Schedule 2 sets forth under the headings
"Securities Accounts" and "Commodities Accounts", respectively, all of the
Securities Accounts and Commodities Accounts (each as defined in the UCC) in
which each Grantor has an interest. Each Grantor, as applicable, is the sole
entitlement holder of each such Securities Account and Commodities Account, and
such Grantor has not consented to, and is not otherwise aware of, any Person
(other than the First Lien Administrative Agent and the Second Lien
Administrative Agent pursuant hereto) having "control" (within the meanings of
Sections 8-106 and 9-106 of the UCC) over, or any other interest in (other than
Liens permitted under Sections 8.3(l) and 9.3(l) of the Credit Agreement), any
such Securities Account or Commodity Account or any securities or other property
credited thereto;
(b) Schedule 2 sets forth under the heading "Deposit Accounts" all of
the Deposit Accounts in which each Grantor has an interest and each Grantor is
the sole account holder of each such Deposit Account and such Grantor has not
consented to, and is not otherwise aware of, any Person (other than the First
Lien Administrative Agent and the Second Lien Administrative Agent pursuant
hereto) having either sole dominion and control (within the meaning of common
law) or "control" (within the meaning of Section 9-104 of the UCC) over, or any
other interest in (other than Liens permitted under Sections 8.3(l) and 9.3(l)
of the Credit Agreement), any such Deposit Account or any money or other
property deposited therein; and
(c) Each Grantor has taken all actions necessary or desirable to: (i)
establish the First Lien Administrative Agent's "control" (within the meanings
of Sections 8-106 and 9-106 of the UCC) over any Certificated Securities (as
defined in the UCC); (ii) establish each of the First Lien Administrative
Agent's and the Second Lien Administrative Agent's "control" (within the
meanings of Sections 8-106 and 9-106 of the UCC) over any portion of the
Investment Accounts constituting Securities Accounts, Commodities Accounts,
Securities Entitlements or Uncertificated Securities (each as defined in the
UCC); (iii) establish the Agent's "control" (within the meaning of Section 9-104
of the UCC) over all Deposit Accounts, other than Deposit Accounts that are used
solely for the purpose of holding amounts necessary to fund payroll and related
payroll taxes in the ordinary course of business and consistent with past
practices (in an amount necessary to fund payroll and related payroll taxes
which are becoming due within the two (2) Business Days immediately succeeding a
deposit) and other amounts not to exceed $1,000,000 in the aggregate for all
such Deposit Accounts (such Deposit Accounts as of the Restatement Effective
Date are listed on Schedule 7); and (iv) to deliver all Instruments (as defined
in the UCC) to the First Lien Administrative Agent to the extent required
hereunder.
4.8 Receivables. No amount payable to such Grantor under or in
connection with any Receivable is evidenced by any Instrument (other than
checks, drafts or other Instruments that will be promptly deposited in an
Investment Account) or Chattel Paper which has not been delivered to the
Administrative Agent.
9
4.9 Intellectual Property. (a) Schedule 6 lists all registrations and
applications for Intellectual Property (including, without limitation,
registered Copyrights, Patents, Trademarks and all applications therefor) as
well as all Copyright Licenses, Patent Licenses and Trademark Licenses, in each
case owned by such Grantor in its own name on the date hereof.
(b) Each Grantor owns, is licensed to use, or otherwise has valid
rights to use all Intellectual Property necessary for the conduct of its
business as currently conducted. The use of such Intellectual Property by each
Grantor does not, to the knowledge of the Grantors, infringe on the rights of
any Person in any material respect. No material claim has been asserted and is
pending by any Person challenging or questioning the use of any Intellectual
Property or the validity or effectiveness of any Intellectual Property, nor does
any Grantor know of any valid basis for any such claim.
(c) Except as set forth in Schedule 6, on the date hereof, none of
the Intellectual Property is the subject of any licensing or franchise agreement
pursuant to which such Grantor is the licensor or franchisor.
(d) No holding, decision or judgment has been rendered by any
Governmental Authority which would limit, cancel or question the validity of, or
such Grantor's rights in, any Intellectual Property in any respect that could
reasonably be expected to have a Material Adverse Effect.
(e) No action or proceeding is pending, or, to the knowledge of such
Grantor, threatened, on the date hereof (i) seeking to limit, cancel or question
the validity of any material Intellectual Property or such Grantor's ownership
interest therein, or (ii) which, if adversely determined, would have a material
adverse effect on the value of any material Intellectual Property.
Section 5. FIRST LIEN COVENANTS
Subject, in each case, to the provisions of Section 14 of the Credit
Agreement, each Grantor covenants and agrees with the First Lien Administrative
Agent, the Administrative Agent and the other First Lien Secured Lenders that,
from and after the date of this Agreement until the Discharge of First Lien
Obligations:
5.1 Delivery of Instruments, Certificated Securities and Chattel
Paper. If any amount payable under or in connection with any of the First Lien
Collateral shall be or become evidenced by any Instrument (other than checks,
drafts or other Instruments that will be promptly deposited in an Investment
Account), Certificated Security or Chattel Paper evidencing an amount in excess
of $150,000, such Instrument, Certificated Security or Chattel Paper shall be
promptly delivered to the First Lien Administrative Agent, duly indorsed in a
manner satisfactory to the First Lien Administrative Agent, to be held as First
Lien Collateral pursuant to this Agreement.
10
5.2 Maintenance of Insurance. (a) Such Grantor will maintain, with
financially sound and reputable companies, insurance policies (i) insuring the
Inventory and Equipment against loss by fire, explosion, theft and such other
casualties as may be reasonably satisfactory to the First Lien Administrative
Agent and (ii) insuring such Grantor, the First Lien Administrative Agent, the
Administrative Agent and the First Lien Secured Parties against liability for
personal injury and property damage relating to such Inventory and Equipment,
such policies to be in such form and amounts and having such coverage as may be
reasonably satisfactory to the First Lien Administrative Agent, the
Administrative Agent and the other First Lien Secured Parties.
(b) All such insurance shall (i) provide that no cancellation,
material reduction in amount or material change in coverage thereof shall be
effective until at least 30 days after receipt by the First Lien Administrative
Agent of written notice thereof, (ii) name the First Lien Administrative Agent
as an additional insured party or loss payee, (iii) to the extent available on
commercially reasonable terms, and if reasonably requested by the First Lien
Administrative Agent, include a breach of warranty clause and (iv) be reasonably
satisfactory in all other respects to the First Lien Administrative Agent.
(c) The Borrower shall deliver to the First Lien Administrative Agent
a report of a reputable insurance broker with respect to such insurance
substantially concurrently with each delivery of the Borrower's audited annual
financial statements and such supplemental reports with respect thereto as the
First Lien Administrative Agent may from time to time reasonably request.
5.3 Payment of Obligations. Such Grantor will pay and discharge or
otherwise satisfy at or before maturity or before they become delinquent, as the
case may be, all taxes, assessments and governmental charges or levies imposed
upon the First Lien Collateral or in respect of income or profits therefrom, as
well as all claims of any kind (including, without limitation, claims for labor,
materials and supplies) against or with respect to the First Lien Collateral
(other than Liens permitted under Sections 8.3 and 9.3 of the Credit Agreement),
except that no such tax, assessment, charge, levy or claim need be paid if the
amount or validity thereof is currently being contested in good faith by
appropriate proceedings, reserves in conformity with GAAP with respect thereto
have been provided on the books of such Grantor and such proceedings could not
reasonably be expected to result in the sale, forfeiture or loss of any material
portion of the First Lien Collateral or any interest therein.
5.4 Maintenance of Perfected Security Interest; Further
Documentation. (a) Such Grantor shall maintain the security interests of the
First Lien Secured Parties created by this Agreement as perfected security
interests having at least the priority described in Section 4.2 and shall defend
such security interests against the claims and demands of all Persons
whomsoever, subject to the rights of such Grantor under the Loan Documents to
dispose of the First Lien Collateral.
(b) Such Grantor will furnish to the First Lien Administrative Agent
from time to time statements and schedules further identifying and describing
the assets and property of such Grantor and such other reports in connection
therewith as the First Lien Administrative Agent may reasonably request, all in
reasonable detail.
(c) At any time and from time to time, upon the written request of
the First Lien Administrative Agent, and at the sole expense of such Grantor,
such Grantor will promptly and duly execute and deliver, and have recorded, such
further instruments and documents and take such further actions as the First
Lien Administrative Agent may reasonably request for the purpose of obtaining or
preserving the full benefits of this Agreement and of the rights and powers
herein granted, including, without limitation, (i) filing any financing or
continuation statements under the Uniform Commercial Code (or other similar
laws) in effect in any jurisdiction with respect to the security interests
created hereby and (ii) in the case of Investment Property, Investment Accounts,
Letter-of-Credit Rights and any other relevant First Lien Collateral, taking any
actions necessary to enable the First Lien Administrative Agent to obtain
"control" (within the meaning of the applicable Uniform Commercial Code) with
respect thereto to the extent required hereunder.
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5.5 Changes in Locations, Name, etc. Such Grantor will not, except
upon 15 days' (or such shorter period as may be agreed to by the First Lien
Administrative Agent) prior written notice to the First Lien Administrative
Agent and delivery to the First Lien Administrative Agent of (a) all additional
executed financing statements and other documents reasonably requested by the
First Lien Administrative Agent to maintain the validity, perfection and
priority of the security interests provided for herein and (b) if applicable, a
written supplement to Schedule 4 showing the relevant new jurisdiction of
organization, location of chief executive office or sole place of business, as
appropriate:
(i) change its jurisdiction of organization or the location of its
chief executive office or sole place of business, as appropriate, from that
referred to in Section 4.3; or
(ii) change its name.
5.6 Notices. Such Grantor will advise the First Lien Administrative
Agent promptly, in reasonable detail, of:
(a) any Lien (other than security interests created by this Agreement
or Liens permitted under the Credit Agreement) on any of the First Lien
Collateral which would adversely affect the ability of the First Lien
Administrative Agent to exercise any of its remedies hereunder; and
(b) the occurrence of any other event which could reasonably be
expected to have a material adverse effect on the aggregate value of the First
Lien Collateral or on the security interests created hereby.
5.7 Investment Property. (a) If such Grantor shall become entitled to
receive or shall receive any certificate (including, without limitation, any
certificate representing a dividend or a distribution in connection with any
reclassification, increase or reduction of capital or any certificate issued in
connection with any reorganization), option or rights in respect of the Capital
Stock of any Issuer, whether in addition to, in substitution of, as a conversion
of, or in exchange for, any shares of the Pledged Stock, or otherwise in respect
thereof, such Grantor shall accept the same as the agent of the First Lien
Administrative Agent and the other First Lien Secured Parties, hold the same in
trust for the First Lien Administrative Agent and the other First Lien Secured
Parties and deliver the same forthwith to the First Lien Administrative Agent in
the exact form received, duly indorsed by such Grantor to the First Lien
Administrative Agent, if required, together with an undated stock power covering
such certificate duly executed in blank by such Grantor and with, if the First
Lien Administrative Agent so requests, signature guaranteed, to be held by the
First Lien Administrative Agent, subject to the terms hereof, as additional
collateral security for the First Lien Obligations. Any sums paid upon or in
respect of the Investment Property upon the liquidation or dissolution of any
Issuer shall, unless otherwise subject to a perfected security interest in favor
of the First Lien Administrative Agent, be paid over to the First Lien
Administrative Agent to be held by it hereunder as additional collateral
security for the First Lien Obligations, and in case any distribution of capital
shall be made on or in respect of the Investment Property or any property shall
be distributed upon or with respect to the Investment Property pursuant to the
recapitalization or reclassification of the capital of any Issuer or pursuant to
the reorganization thereof, the property so distributed shall, unless otherwise
subject to a perfected security interest in favor of the First Lien
Administrative Agent, be delivered to the First Lien Administrative Agent to be
held by it hereunder as additional collateral security for the First Lien
Obligations. If any sums of money or property so paid or distributed in respect
of such Investment Property shall be received by such Grantor, such Grantor
shall, until such money or property is paid or delivered to the First Lien
Administrative Agent, unless otherwise subject to a perfected security interest
in favor of the First Lien Administrative Agent, hold such money or property in
trust for the First Lien Administrative Agent and the other First Lien Secured
Parties, segregated from other funds of such Grantor, as additional collateral
security for the First Lien Obligations.
12
(b) Without the prior written consent of the First Lien
Administrative Agent, and except as permitted by the Credit Agreement, such
Grantor will not (i) vote to enable, or take any other action to permit, any
Issuer to issue any Capital Stock of any nature or to issue any other securities
convertible into or granting the right to purchase or exchange for any Capital
Stock of any nature of any Issuer, (ii) sell, assign, transfer, exchange, or
otherwise dispose of, or grant any option with respect to, the Investment
Property or Proceeds thereof, (iii) create, incur or permit to exist any Lien or
option in favor of, or any claim of any Person with respect to, any of the
Investment Property or Proceeds thereof, or any interest therein, except for the
security interests created by this Agreement or (iv) enter into any agreement or
undertaking restricting the right or ability of such Grantor or the First Lien
Administrative Agent to sell, assign or transfer any of the Investment Property
or Proceeds thereof.
(c) In the case of each Grantor which is an Issuer, such Issuer
agrees that (i) it will be bound by the terms of this Agreement relating to the
Capital Stock issued by it and will comply with such terms insofar as such terms
are applicable to it, (ii) it will notify the First Lien Administrative Agent
promptly in writing of the occurrence of any of the events described in Section
5.7(a) with respect to the Capital Stock issued by it and (iii) the terms of
Sections 7.3(c) and 7.7 shall apply to it, mutatis mutandis, with respect to all
actions that may be required of it pursuant to Section 7.3(c) or 7.7 with
respect to the Capital Stock issued by it.
(d) All Excluded Stock shall be held, beneficially or of record, by
Grantors other than the Borrower, Holdings or CG Austria.
5.8 Investment Accounts. With respect to any Investment Accounts
consisting of Securities Accounts or Securities Entitlements, it shall enter
into and shall cause the securities intermediary maintaining such Securities
Account or Securities Entitlement to enter into an agreement in form and
substance reasonably satisfactory to the First Lien Administrative Agent
pursuant to which it shall agree to comply with the Agent's "entitlement orders"
without further consent by such Grantor. With respect to any Investment Account
that is a "Deposit Account," it shall enter into and shall cause the depositary
institution maintaining such account to enter into an agreement in form and
substance reasonably satisfactory to the First Lien Administrative Agent,
pursuant to which the First Lien Administrative Agent shall have "control"
(within the meaning of Section 9-104 of the UCC) over such Deposit Account;
provided that this Section 5.8 shall not apply to Deposit Accounts that are used
solely for the purpose of holding (a) amounts necessary to fund payroll and
related payroll taxes in the ordinary course of business and consistent with
past practices (in an amount necessary to fund payroll and related payroll taxes
which are becoming due within the two (2) Business Days immediately succeeding a
deposit) and (b) other amounts not to exceed $1,000,000 in the aggregate for all
such Deposit Accounts (such Deposit Accounts as of the Restatement Effective
Date are listed on Schedule 7).
5.9 Receivables. Other than in the ordinary course of business
consistent with its past practice, such Grantor will not (i) grant any extension
of the time of payment of any Receivable, (ii) compromise or settle any
Receivable for less than the full amount thereof, (iii) release, wholly or
partially, any Person liable for the payment of any Receivable, (iv) allow any
credit or discount whatsoever on any Receivable or (v) amend, supplement or
modify any Receivable in any manner that could adversely affect the value
thereof.
13
5.10 Intellectual Property. (a) Such Grantor (either itself or
through licensees) will (i) continue to use each material Trademark in order to
maintain such material Trademark in full force free from any claim of
abandonment for non-use, (ii) maintain as in the past the quality of products
and services offered under such material Trademark, (iii) use such material
Trademark with the appropriate notice of registration and all other notices and
legends required by applicable Requirements of Law, (iv) not adopt or use any
xxxx which is confusingly similar or a colorable imitation of such material
Trademark unless the First Lien Administrative Agent, for the ratable benefit of
the First Lien Secured Parties, shall obtain a perfected security interest in
such xxxx pursuant to this Agreement, and (v) not (and not knowingly permit any
licensee or sublicensee thereof to) do any act or knowingly omit to do any act
whereby such Trademark may become invalidated or impaired in any way.
(b) Such Grantor (either itself or through licensees) will not do any
act, or omit to do any act, whereby any material Patent may become forfeited,
abandoned or dedicated to the public.
(c) Such Grantor (either itself or through licensees) will not (and
will not permit any licensee or sublicensee thereof to) do any act or knowingly
omit to do any act whereby any such material Copyrights may become invalidated
or otherwise impaired. Such Grantor will not (either itself or through
licensees) do any act whereby any material portion of such Copyrights may fall
into the public domain.
(d) Such Grantor (either itself or through licensees) will not do any
act that knowingly uses any material Intellectual Property to infringe the
intellectual property rights of any other Person.
(e) Such Grantor will notify the First Lien Administrative Agent
promptly if it knows, or has reason to know, that any application or
registration relating to any material Intellectual Property may become
forfeited, abandoned or dedicated to the public, 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, the United States Copyright Office or any court or tribunal in
any country) regarding such Grantor's ownership of, or the validity of, any
material Intellectual Property or such Grantor's right to register the same or
to own and maintain the same.
(f) Whenever such Grantor, either by itself or through any agent,
employee, licensee or designee, shall file an application for the registration
of any Intellectual Property with the United States Patent and Trademark Office,
the United States Copyright Office or any similar office or agency in any other
country or any political subdivision thereof, such Grantor shall report such
filing to the First Lien Administrative Agent within 45 days after the last day
of the fiscal quarter in which such filing occurs. Upon request of the First
Lien Administrative Agent, such Grantor shall execute and deliver, and have
recorded, any and all agreements, instruments, documents, and papers as the
First Lien Administrative Agent may reasonably request to evidence the First
Lien Administrative Agent's and the other First Lien Secured Parties' security
interest in any Copyright, Patent or Trademark and the goodwill and general
intangibles of such Grantor relating thereto or represented thereby.
(g) Such Grantor will take all reasonable and necessary steps,
including, without limitation, in any proceeding before the United States Patent
and Trademark Office, the United States Copyright 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 Intellectual Property,
including, without limitation, filing of applications for renewal, affidavits of
use and affidavits of incontestability.
(h) In the event that any material Intellectual Property is
infringed, misappropriated or diluted by a third party, such Grantor shall take
such actions as such Grantor shall reasonably deem appropriate under the
circumstances to protect such Intellectual Property.
14
5.11 Section 5 for the Exclusive Benefit of the First Lien
Administrative Agent and the other First Lien Secured Parties. For the avoidance
of doubt, the parties to this Agreement hereby agree and acknowledge that the
provisions of this Section 5 are for the exclusive benefit of the First Lien
Administrative Agent and the other First Lien Secured Parties and that the
provisions of this Section 5 do not apply to the Second Lien Administrative
Agent or the other Second Lien Secured Parties in any manner whatsoever.
Section 6. SECOND LIEN COVENANTS
Subject, in each case, to the provisions of Section 14 of the Credit
Agreement, each Grantor covenants and agrees with the Second Lien Administrative
Agent and the other Second Lien Secured Parties that, from and after the date of
this Agreement until the Discharge of Second Lien Obligations:
6.1 Delivery of Instruments, Certificated Securities and Chattel
Paper. If any amount payable under or in connection with any of the Second Lien
Collateral shall be or become evidenced by any Instrument (other than checks,
drafts or other Instruments that will be promptly deposited in an Investment
Account), Certificated Security or Chattel Paper evidencing an amount in excess
of $150,000, such Instrument, Certificated Security or Chattel Paper shall be
promptly delivered to the Second Lien Administrative Agent, duly indorsed in a
manner satisfactory to the Second Lien Administrative Agent, to be held as
Second Lien Collateral pursuant to this Agreement.
6.2 Maintenance of Insurance. (a) Such Grantor will maintain, with
financially sound and reputable companies, insurance policies (i) insuring the
Inventory and Equipment against loss by fire, explosion, theft and such other
casualties as may be reasonably satisfactory to the Second Lien Administrative
Agent and (ii) insuring such Grantor, the Second Lien Administrative Agent and
the Second Lien Secured Parties against liability for personal injury and
property damage relating to such Inventory and Equipment, such policies to be in
such form and amounts and having such coverage as may be reasonably satisfactory
to the Second Lien Administrative Agent and the other Second Lien Secured
Parties.
(b) All such insurance shall (i) provide that no cancellation,
material reduction in amount or material change in coverage thereof shall be
effective until at least 30 days after receipt by the Second Lien Administrative
Agent of written notice thereof, (ii) name the Second Lien Administrative Agent
as an additional insured party or loss payee, (iii) to the extent available on
commercially reasonable terms, and if reasonably requested by the Second Lien
Administrative Agent, include a breach of warranty clause and (iv) be reasonably
satisfactory in all other respects to the Second Lien Administrative Agent.
(c) The Borrower shall deliver to the Second Lien Administrative
Agent a report of a reputable insurance broker with respect to such insurance
substantially concurrently with each delivery of the Borrower's audited annual
financial statements and such supplemental reports with respect thereto as the
Second Lien Administrative Agent may from time to time reasonably request.
6.3 Payment of Obligations. Such Grantor will pay and discharge or
otherwise satisfy at or before maturity or before they become delinquent, as the
case may be, all taxes, assessments and governmental charges or levies imposed
upon the Second Lien Collateral or in respect of income or profits therefrom, as
well as all claims of any kind (including, without limitation, claims for labor,
materials and supplies) against or with respect to the Second Lien Collateral
(other than Liens permitted under Sections 8.3 and 9.3 of the Credit Agreement),
except that no such tax, assessment, charge, levy or claim need be paid if the
amount or validity thereof is currently being contested in good faith by
appropriate proceedings, reserves in conformity with GAAP with respect thereto
have been provided on the books of such Grantor and such proceedings could not
reasonably be expected to result in the sale, forfeiture or loss of any material
portion of the Second Lien Collateral or any interest therein.
15
6.4 Maintenance of Perfected Security Interest; Further
Documentation. (a) Such Grantor shall maintain the security interests of the
Second Lien Secured Parties created by this Agreement as perfected security
interests having at least the priority described in Section 4.2 and shall defend
such security interests against the claims and demands of all Persons
whomsoever, subject to the rights of such Grantor under the Loan Documents to
dispose of the Second Lien Collateral.
(b) Such Grantor will furnish to the Second Lien Administrative Agent
from time to time statements and schedules further identifying and describing
the assets and property of such Grantor and such other reports in connection
therewith as the Second Lien Administrative Agent may reasonably request, all in
reasonable detail.
(c) At any time and from time to time, upon the written request of
the Second Lien Administrative Agent, and at the sole expense of such Grantor,
such Grantor will promptly and duly execute and deliver, and have recorded, such
further instruments and documents and take such further actions as the Second
Lien Administrative Agent may reasonably request for the purpose of obtaining or
preserving the full benefits of this Agreement and of the rights and powers
herein granted, including, without limitation, (i) filing any financing or
continuation statements under the Uniform Commercial Code (or other similar
laws) in effect in any jurisdiction with respect to the security interests
created hereby and (ii) in the case of Investment Property, Investment Accounts,
Letter-of-Credit Rights and any other relevant Second Lien Collateral, taking
any actions necessary to enable the Second Lien Administrative Agent to obtain
"control" (within the meaning of the applicable Uniform Commercial Code) with
respect thereto.
6.5 Changes in Locations, Name, etc. Such Grantor will not, except
upon 15 days' (or such shorter period as may be agreed to by the First Lien
Administrative Agent) prior written notice to the Second Lien Administrative
Agent and delivery to the Second Lien Administrative Agent of (a) all additional
executed financing statements and other documents reasonably requested by the
Second Lien Administrative Agent to maintain the validity, perfection and
priority of the security interests provided for herein and (b) if applicable, a
written supplement to Schedule 4 showing the relevant new jurisdiction of
organization, location of chief executive office or sole place of business, as
appropriate:
(i) change its jurisdiction of organization or the location of its
chief executive office or sole place of business, as appropriate, from that
referred to in Section 4.3; or
(ii) change its name.
6.6 Notices. Such Grantor will advise the Second Lien Administrative
Agent promptly, in reasonable detail, of:
(a) any Lien (other than security interests created by this Agreement
or Liens permitted under the Credit Agreement) on any of the Second Lien
Collateral which would adversely affect the ability of the Second Lien
Administrative Agent to exercise any of its remedies hereunder; and
(b) the occurrence of any other event which could reasonably be
expected to have a material adverse effect on the aggregate value of the Second
Lien Collateral or on the security interests created hereby.
16
6.7 Investment Property. (a) If such Grantor shall become entitled to
receive or shall receive any certificate (including, without limitation, any
certificate representing a dividend or a distribution in connection with any
reclassification, increase or reduction of capital or any certificate issued in
connection with any reorganization), option or rights in respect of the Capital
Stock of any Issuer, whether in addition to, in substitution of, as a conversion
of, or in exchange for, any shares of the Pledged Stock, or otherwise in respect
thereof, such Grantor shall accept the same as the agent of the Second Lien
Administrative Agent and the other Second Lien Secured Parties, hold the same in
trust for the Second Lien Administrative Agent and the other Second Lien Secured
Parties and deliver the same forthwith to the Second Lien Administrative Agent
in the exact form received, duly indorsed by such Grantor to the Second Lien
Administrative Agent, if required, together with an undated stock power covering
such certificate duly executed in blank by such Grantor and with, if the Second
Lien Administrative Agent so requests, signature guaranteed, to be held by the
Second Lien Administrative Agent, subject to the terms hereof, as additional
collateral security for the Second Lien Obligations. Any sums paid upon or in
respect of the Investment Property upon the liquidation or dissolution of any
Issuer shall, unless otherwise subject to a perfected security interest in favor
of the Second Lien Administrative Agent, be paid over to the Second Lien
Administrative Agent to be held by it hereunder as additional collateral
security for the Second Lien Obligations, and in case any distribution of
capital shall be made on or in respect of the Investment Property or any
property shall be distributed upon or with respect to the Investment Property
pursuant to the recapitalization or reclassification of the capital of any
Issuer or pursuant to the reorganization thereof, the property so distributed
shall, unless otherwise subject to a perfected security interest in favor of the
Second Lien Administrative Agent, be delivered to the Second Lien Administrative
Agent to be held by it hereunder as additional collateral security for the
Obligations. If any sums of money or property so paid or distributed in respect
of such Investment Property shall be received by such Grantor, such Grantor
shall, until such money or property is paid or delivered to the Second Lien
Administrative Agent, unless otherwise subject to a perfected security interest
in favor of the Second Lien Administrative Agent, hold such money or property in
trust for the Second Lien Administrative Agent and the other Second Lien Secured
Parties, segregated from other funds of such Grantor, as additional collateral
security for the Second Lien Obligations.
(b) Without the prior written consent of the Second Lien
Administrative Agent, and except as permitted by the Credit Agreement such
Grantor will not (i) vote to enable, or take any other action to permit, any
Issuer to issue any Capital Stock of any nature or to issue any other securities
convertible into or granting the right to purchase or exchange for any Capital
Stock of any nature of any Issuer, (ii) sell, assign, transfer, exchange, or
otherwise dispose of, or grant any option with respect to, the Investment
Property or Proceeds thereof, (iii) create, incur or permit to exist any Lien or
option in favor of, or any claim of any Person with respect to, any of the
Investment Property or Proceeds thereof, or any interest therein, except for the
security interests created by this Agreement or (iv) enter into any agreement or
undertaking restricting the right or ability of such Grantor or the Second Lien
Administrative Agent to sell, assign or transfer any of the Investment Property
or Proceeds thereof.
(c) In the case of each Grantor which is an Issuer, such Issuer
agrees that (i) it will be bound by the terms of this Agreement relating to the
Capital Stock issued by it and will comply with such terms insofar as such terms
are applicable to it, (ii) it will notify the Second Lien Administrative Agent
promptly in writing of the occurrence of any of the events described in Section
6.7(a) with respect to the Capital Stock issued by it and (iii) the terms of
Sections 8.3(c) and 8.7 shall apply to it, mutatis mutandis, with respect to all
actions that may be required of it pursuant to Section 8.3(c) or 8.7 with
respect to the Capital Stock issued by it.
(d) All Excluded Stock shall be held, beneficially or of record, by
Grantors other than the Borrower, Holdings or CG Austria.
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6.8 Investment Accounts. With respect to any Investment Accounts
consisting of Securities Accounts or Securities Entitlements, it shall enter
into and shall cause the securities intermediary maintaining such Securities
Account or Securities Entitlement to enter into an agreement in form and
substance reasonably satisfactory to the Second Lien Administrative Agent
pursuant to which it shall agree to comply with the Agent's "entitlement orders"
without further consent by such Grantor. With respect to any Investment Account
that is a "Deposit Account," it shall enter into and shall cause the depositary
institution maintaining such account to enter into an agreement in form and
substance reasonably satisfactory to the Second Lien Administrative Agent,
pursuant to which the Second Lien Administrative Agent shall have "control"
(within the meaning of Section 9-104 of the UCC) over such Deposit Account;
provided that this Section 6.8 shall not apply to Deposit Accounts that are used
solely for the purpose of holding (a) amounts necessary to fund payroll and
related payroll taxes in the ordinary course of business and consistent with
past practices (in an amount necessary to fund payroll and related payroll taxes
which are becoming due within the two (2) Business Days immediately succeeding a
deposit) and (b) other amounts not to exceed $1,000,000 in the aggregate for all
such Deposit Accounts (such Deposit Accounts as of the Restatement Effective
Date are listed on Schedule 7).
6.9 Receivables. Other than in the ordinary course of business
consistent with its past practice, such Grantor will not (i) grant any extension
of the time of payment of any Receivable, (ii) compromise or settle any
Receivable for less than the full amount thereof, (iii) release, wholly or
partially, any Person liable for the payment of any Receivable, (iv) allow any
credit or discount whatsoever on any Receivable or (v) amend, supplement or
modify any Receivable in any manner that could adversely affect the value
thereof.
6.10 Intellectual Property. (a) Such Grantor (either itself or
through licensees) will (i) continue to use each material Trademark in order to
maintain such material Trademark in full force free from any claim of
abandonment for non-use, (ii) maintain as in the past the quality of products
and services offered under such material Trademark, (iii) use such material
Trademark with the appropriate notice of registration and all other notices and
legends required by applicable Requirements of Law, (iv) not adopt or use any
xxxx which is confusingly similar or a colorable imitation of such material
Trademark unless the Second Lien Administrative Agent, for the ratable benefit
of the Second Lien Secured Parties, shall obtain a perfected security interest
in such xxxx pursuant to this Agreement, and (v) not (and not knowingly permit
any licensee or sublicensee thereof to) do any act or knowingly omit to do any
act whereby such Trademark may become invalidated or impaired in any way.
(b) Such Grantor (either itself or through licensees) will not do any
act, or omit to do any act, whereby any material Patent may become forfeited,
abandoned or dedicated to the public.
(c) Such Grantor (either itself or through licensees) will not (and
will not permit any licensee or sublicensee thereof to) do any act or knowingly
omit to do any act whereby any such material Copyrights may become invalidated
or otherwise impaired. Such Grantor will not (either itself or through
licensees) do any act whereby any material portion of such Copyrights may fall
into the public domain.
(d) Such Grantor (either itself or through licensees) will not do any
act that knowingly uses any material Intellectual Property to infringe the
intellectual property rights of any other Person.
(e) Such Grantor will notify the Second Lien Administrative Agent
promptly if it knows, or has reason to know, that any application or
registration relating to any material Intellectual Property may become
forfeited, abandoned or dedicated to the public, 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, the United States Copyright Office or any court or tribunal in
any country) regarding such Grantor's ownership of, or the validity of, any
material Intellectual Property or such Grantor's right to register the same or
to own and maintain the same.
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(f) Whenever such Grantor, either by itself or through any agent,
employee, licensee or designee, shall file an application for the registration
of any Intellectual Property with the United States Patent and Trademark Office,
the United States Copyright Office or any similar office or agency in any other
country or any political subdivision thereof, such Grantor shall report such
filing to the Second Lien Administrative Agent within 45 days after the last day
of the fiscal quarter in which such filing occurs. Upon request of the Second
Lien Administrative Agent, such Grantor shall execute and deliver, and have
recorded, any and all agreements, instruments, documents, and papers as the
Second Lien Administrative Agent may reasonably request to evidence the Second
Lien Administrative Agent's and the other Second Lien Secured Parties' security
interest in any Copyright, Patent or Trademark and the goodwill and general
intangibles of such Grantor relating thereto or represented thereby.
(g) Such Grantor will take all reasonable and necessary steps,
including, without limitation, in any proceeding before the United States Patent
and Trademark Office, the United States Copyright 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 Intellectual Property,
including, without limitation, filing of applications for renewal, affidavits of
use and affidavits of incontestability.
(h) In the event that any material Intellectual Property is
infringed, misappropriated or diluted by a third party, such Grantor shall take
such actions as such Grantor shall reasonably deem appropriate under the
circumstances to protect such Intellectual Property.
6.11 Section 6 for the Exclusive Benefit of the Second Lien
Administrative Agent and the other Second Lien Secured Parties. For the
avoidance of doubt, the parties to this Agreement hereby agree and acknowledge
that the provisions of this Section 6 are for the exclusive benefit of the
Second Lien Administrative Agent and the other Second Lien Secured Parties and
that the provisions of this Section 6 do not apply to the First Lien
Administrative Agent or the other First Lien Secured Parties in any manner
whatsoever.
6.12 Delivery of Collateral. Notwithstanding anything to the contrary
contained in this Section 6, prior to the Discharge of the First Lien
Obligations, no Grantor shall be required to deliver physical possession of any
Collateral or turn over proceeds of the Collateral (including, but not limited
to any Instrument, Certificated Security or Chattel Paper) to the Second
Administrative Agent, provided that such Grantor has complied with the
requirements regarding delivery or turn over of such Collateral to the First
Lien Administrative Agent in accordance with the provisions contained in Section
5 of this Agreement.
Section 7. FIRST LIEN ADMINISTRATIVE AGENT REMEDIAL PROVISIONS
Subject, in each case, to the provisions of Section 14 of the Credit
Agreement, each Grantor covenants and agrees with the First Lien Administrative
Agent and the other First Lien Secured Parties that, from and after the date of
this Agreement until the Discharge of First Lien Obligations:
7.1 Certain Matters Relating to Receivables. (a) The First Lien
Administrative Agent hereby authorizes each Grantor to collect such Grantor's
Receivables and the First Lien Administrative Agent may curtail or terminate
said authority at any time after the occurrence and during the continuance of a
First Lien Event of Default. If required by the First Lien Administrative Agent
at any time after the occurrence and during the continuance of a First Lien
Event of Default, any payments of Receivables, when collected by any Grantor,
(i) shall be forthwith (and, in any event, within two Business Days) deposited
by such Grantor in the exact form received, duly indorsed by such Grantor to the
First Lien Administrative Agent if required, in a Collateral Account over which
the First Lien Administrative Agent has control, subject to withdrawal by the
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First Lien Administrative Agent for the account of the First Lien Secured
Parties only as provided in Section 7.5, and (ii) until so turned over, shall be
held by such Grantor in trust for the First Lien Administrative Agent and the
other First Lien Secured Parties, segregated from other funds of such Grantor.
After the occurrence of a First Lien Event of Default, each such deposit of
Proceeds of Receivables shall be accompanied by a report identifying in
reasonable detail the nature and source of the payments included in the deposit.
(b) At the First Lien Administrative Agent's request, after the
occurrence of a First Lien Event of Default each Grantor shall deliver to the
First Lien Administrative Agent all original and other documents evidencing, and
relating to, the agreements and transactions which gave rise to the Receivables,
including, without limitation, all original orders, invoices and shipping
receipts.
7.2 Communications with Obligors; Grantors Remain Liable. (a) The
First Lien Administrative Agent in its own name or in the name of others may at
any time after the occurrence and during the continuance of a First Lien Event
of Default communicate with obligors under the Receivables and parties to the
Contracts to verify with them to the First Lien Administrative Agent's
satisfaction the existence, amount and terms of any Receivables or Contracts.
(b) Upon the request of the First Lien Administrative Agent, at any
time after the occurrence and during the continuance of a First Lien Event of
Default, each Grantor shall notify obligors on the Receivables and parties to
the Contracts that the Receivables and the Contracts have been assigned to the
First Lien Administrative Agent for the ratable benefit of the First Lien
Secured Parties and that payments in respect thereof shall be made directly to
the First Lien Administrative Agent.
(c) Anything herein to the contrary notwithstanding, each Grantor
shall remain liable under each of the Receivables and Contracts 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
thereto. Neither the First Lien Administrative Agent nor any other First Lien
Secured Party shall have any obligation or liability under any Receivable (or
any agreement giving rise thereto) or Contract by reason of or arising out of
this Agreement or the receipt by the First Lien Administrative Agent or any
Lender of any payment relating thereto, nor shall the First Lien Administrative
Agent or any other First Lien Secured Party be obligated in any manner to
perform any of the obligations of any Grantor under or pursuant to any
Receivable (or any agreement giving rise thereto) or Contract, 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
thereunder, 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.
7.3 Investment Property. (a) Unless a First Lien Event of Default
shall have occurred and be continuing and the First Lien Administrative Agent
shall have given notice to the relevant Grantor of the First Lien Administrative
Agent's intent to exercise its corresponding rights pursuant to Section 7.3(b),
each Grantor shall be permitted to receive all cash dividends paid in respect of
the Pledged Stock and all payments made in respect of the Pledged Notes, to the
extent permitted in the Credit Agreement, and to exercise all voting and
corporate or other organizational rights with respect to the Investment
Property; provided, however, that no vote shall be cast or corporate or other
organizational right exercised or other action taken which, in the First Lien
Administrative Agent's reasonable judgment, would impair the First Lien
Collateral or which would be inconsistent with or result in any violation of any
provision of the Credit Agreement, this Agreement or any other Loan Document.
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(b) If a First Lien Event of Default shall occur and be continuing
and the First Lien Administrative Agent shall give notice of its intent to
exercise such rights to the relevant Grantor or Grantors, (i) the First Lien
Administrative Agent shall have the right to receive any and all cash dividends,
payments or other Proceeds paid in respect of the Investment Property and make
application thereof to the First Lien Obligations in such order as the First
Lien Administrative Agent may determine, and (ii) any or all of the Investment
Property shall be registered in the name of the First Lien Administrative Agent
or its nominee, and the First Lien Administrative Agent or its nominee may
thereafter exercise (x) all voting, corporate and other rights pertaining to
such Investment Property at any meeting of shareholders of the relevant Issuer
or Issuers or otherwise and (y) any and all rights of conversion, exchange and
subscription and any other rights, privileges or options pertaining to such
Investment Property as if it were the absolute owner thereof (including, without
limitation, the right to exchange at its discretion any and all of the
Investment Property upon the merger, consolidation, reorganization,
recapitalization or other fundamental change in the corporate or other
organizational structure of any Issuer, or upon the exercise by any Grantor or
the First Lien Administrative Agent of any right, privilege or option pertaining
to such Investment Property, and in connection therewith, the right to deposit
and deliver any and all of the Investment Property with any committee,
depositary, transfer agent, registrar or other designated agency upon such terms
and conditions as the First Lien Administrative Agent may determine), all
without liability except to account for property actually received by it, but
the First Lien Administrative Agent shall have no duty to any Grantor to
exercise any such right, privilege or option and shall not be responsible for
any failure to do so or delay in so doing.
(c) Each Grantor hereby authorizes and instructs each Issuer of any
Pledged Stock or Pledged Notes pledged by such Grantor hereunder to (i) comply
with any instruction received by it from the First Lien Administrative Agent in
writing that (x) states that a First Lien Event of Default has occurred and is
continuing and (y) is otherwise in accordance with the terms of this Agreement,
without any other or further instructions from such Grantor, and each Grantor
agrees that each Issuer shall be fully protected in so complying, and (ii)
unless otherwise expressly permitted hereby, pay any dividends or other payments
with respect to the Pledged Stock and Pledged Notes directly to the First Lien
Administrative Agent.
(d) If a First Lien Event of Default shall have occurred and be
continuing, the First Lien Administrative Agent shall have the right to apply
the balance from any Deposit Account or instruct the bank at which any Deposit
Account is maintained to pay the balance of any Deposit Account to or for the
benefit of the First Lien Administrative Agent.
7.4 Proceeds to be Turned Over To First Lien Administrative Agent. In
addition to the rights of the First Lien Administrative Agent and the other
First Lien Secured Parties specified in Section 7.1 with respect to payments of
Receivables, if a First Lien Event of Default shall occur and be continuing, all
Proceeds received by any Grantor consisting of cash, checks, Cash Equivalents
and other near-cash items shall be held by such Grantor in trust for the First
Lien Administrative Agent and the other First Lien Secured Parties, segregated
from other funds of such Grantor, and shall, forthwith upon receipt by such
Grantor, be turned over to the First Lien Administrative Agent in the exact form
received by such Grantor (duly indorsed by such Grantor to the First Lien
Administrative Agent, if required). All Proceeds received by the First Lien
Administrative Agent hereunder shall be held by the First Lien Administrative
Agent in a Collateral Account maintained under its sole dominion and control.
All Proceeds while held by the First Lien Administrative Agent in a Collateral
Account (or by such Grantor in trust for the First Lien Administrative Agent and
the other First Lien Secured Parties) shall continue to be held as collateral
security for all the First Lien Obligations and shall not constitute payment
thereof until applied as provided in Section 7.5.
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7.5 Application of Proceeds. If a First Lien Event of Default shall
have occurred and be continuing, at any time at the First Lien Administrative
Agent's election, the First Lien Administrative Agent may apply all or any part
of Proceeds constituting First Lien Collateral, whether or not held in any
Collateral Account, in payment of the First Lien Obligations in the following
order:
(a) First, to the payment of all costs and expenses of any sale,
collection or other realization on the First Lien Collateral, including
reasonable compensation to the First Lien Administrative Agent, the
Administrative Agent and their agents and counsel, and reimbursement for all
other costs, expenses, liabilities and advances made or incurred by First Lien
Administrative Agent or the Administrative Agent in connection therewith
(including as described in Section 7.6 hereof), and all amounts for which First
Lien Administrative Agent or the Administrative Agent is entitled to
indemnification hereunder and all advances made by First Lien Administrative
Agent or the Administrative Agent hereunder for the account of the applicable
Grantor, and to the payment of all costs and expenses paid or incurred by First
Lien Administrative Agent or the Administrative Agent in connection with the
exercise of any right or remedy hereunder or under the Credit Agreement or any
other Loan Document and to the payment or reimbursement of all indemnification
obligations, fees, costs and expenses owing to the Administrative Agent or the
First Lien Administrative Agent hereunder or under the Credit Agreement or any
other Loan Document, all in accordance with the terms hereof or thereof;
(b) Second, to pay accrued interest on and then principal of any
portion of (without duplication) (x) the Revolving Loans that the Administrative
Agent or the First Lien Administrative Agent may have advanced on behalf of any
First Lien Facility Lender for which the Administrative Agent or the First Lien
Administrative Agent has not then been reimbursed by such First Lien Facility
Lender or Borrower, (y) the amount of drawings honored by any Issuing Lender
under a Letter of Credit for which such Issuing Lender has not then been
reimbursed by any First Lien Facility Lender or Borrower and (z) the amount of
any Swingline Loans for which the Swingline Lender has not been reimbursed by
any First Lien Facility Lender or the Borrower;
(c) Third, to pay accrued and unpaid fees and expenses of the First
Lien Secured Parties under the Loan Documents;
(d) Fourth, for application by it towards payment of amounts then due
and owing and remaining unpaid in respect of the First Lien Obligations, pro
rata among the First Lien Facility Lenders and Qualified Counterparties
according to the amounts of the First Lien Obligations then due and owing and
remaining unpaid to the First Lien Facility Lenders and the Qualified
Counterparties (including obligations with respect to the cash collections of
Letters of Credit);
(e) Fifth, for application by it towards prepayment of the First Lien
Obligations, pro rata among the First Lien Facility Lenders according to the
amounts of the First Lien Obligations then held by the First Lien Facility
Lenders (including obligations with respect to the cash collections of Letters
of Credit); and
(f) Sixth, any balance of such Proceeds remaining after the Discharge
of First Lien Obligations shall be paid over to (a) prior to the Discharge of
Second Lien Obligations, to the Second Lien Administrative Agent and (b)
thereafter, to the Borrower or to whomsoever may be lawfully entitled to receive
the same.
7.6 Code and Other Remedies. If a First Lien Event of Default shall
occur and be continuing, the First Lien Administrative Agent, on behalf of the
First Lien Secured Parties, may exercise, in addition to all other rights and
remedies granted to them in this Agreement and in any other instrument or
agreement securing, evidencing or relating to the First Lien Obligations, all
rights and remedies of a secured party under the New York UCC or any other
applicable law. Without limiting the generality of the foregoing, the First Lien
22
Administrative Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law) to or upon any Grantor or any other Person (all and each of
which demands, defenses, advertisements and notices are hereby waived), may in
such circumstances forthwith collect, receive, appropriate and realize upon the
First Lien Collateral, or any part thereof, and/or may forthwith sell, lease,
assign, give option or options to purchase, or otherwise dispose of and deliver
the First Lien Collateral or any part thereof (or contract to do any of the
foregoing), in one or more parcels at public or private sale or sales, at any
exchange, broker's board or office of the First Lien Administrative Agent or any
other First Lien Secured Party or elsewhere upon such terms and conditions as it
may deem advisable and at such prices as it may deem best, for cash or on credit
or for future delivery without assumption of any credit risk. The First Lien
Administrative Agent or any other First Lien Secured Party shall have the right
upon any such public sale or sales, and, to the extent permitted by law, upon
any such private sale or sales, to purchase the whole or any part of the First
Lien Collateral so sold, free of any right or equity of redemption in any
Grantor, which right or equity is hereby waived and released. Each Grantor
further agrees, at the First Lien Administrative Agent's request, to assemble
the First Lien Collateral and make it available to the First Lien Administrative
Agent at places which the First Lien Administrative Agent shall reasonably
select, whether at such Grantor's premises or elsewhere. The First Lien
Administrative Agent shall apply the net proceeds of any action taken by it
pursuant to this Section 7.6, after deducting all reasonable costs and expenses
of every kind incurred in connection therewith or incidental to the care or
safekeeping of any of the First Lien Collateral or in any way relating to the
First Lien Collateral or the rights of the First Lien Administrative Agent and
the other First Lien Secured Parties hereunder, including, without limitation,
reasonable attorneys' fees and disbursements, to the payment in whole or in part
of the First Lien Obligations, in such order as the First Lien Administrative
Agent may elect, and only after such application and after the payment by the
First Lien Administrative Agent of any other amount required by any provision of
law, including, without limitation, Section 9-615(a)(3) of the New York UCC,
need the First Lien Administrative Agent account for the surplus, if any, to any
Grantor. To the extent permitted by applicable law, each Grantor waives all
claims, damages and demands it may acquire against the First Lien Administrative
Agent or any other First Lien Secured Party arising out of the exercise by them
of any rights hereunder. If any notice of a proposed sale or other disposition
of First Lien Collateral shall be required by law, such notice shall be deemed
reasonable and proper if given at least 10 days before such sale or other
disposition.
7.7 Registration Rights. (a) If the First Lien Administrative Agent
shall determine to exercise its right to sell any or all of the Pledged Stock
pursuant to Section 7.6, and if in the opinion of the First Lien Administrative
Agent it is necessary or advisable to have the Pledged Stock, or that portion
thereof to be sold, registered under the provisions of the Securities Act, the
relevant Grantor will cause the Issuer thereof to (i) execute and deliver, and
cause the directors and officers of such Issuer to execute and deliver, all such
instruments and documents, and do or cause to be done all such other acts as may
be, in the opinion of the First Lien Administrative Agent, necessary or
advisable to register the Pledged Stock, or that portion thereof to be sold,
under the provisions of the Securities Act, (ii) use its best efforts to cause
the registration statement relating thereto to become effective and to remain
effective for a period of one year from the date of the first public offering of
the Pledged Stock, or that portion thereof to be sold, and (iii) make all
amendments thereto and/or to the related prospectus which, in the opinion of the
First Lien Administrative Agent, are necessary or advisable, all in conformity
with the requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto. Each Grantor agrees to
cause such Issuer to comply with the provisions of the securities or "Blue Sky"
laws of any and all jurisdictions which the First Lien Administrative Agent
shall designate and to make available to its security holders, as soon as
practicable, an earnings statement (which need not be audited) which will
satisfy the provisions of Section 11(a) of the Securities Act.
23
(b) Each Grantor recognizes that the First Lien Administrative Agent
may be unable to effect a public sale of any or all the Pledged Stock, by reason
of certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers which will be obliged
to agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof. Each
Grantor acknowledges and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The First Lien
Administrative Agent shall be under no obligation to delay a sale of any of the
Pledged Stock for the period of time necessary to permit the Issuer thereof to
register such securities for public sale under the Securities Act, or under
applicable state securities laws, even if such Issuer would agree to do so.
(c) Each Grantor agrees to use its best efforts to do or cause to be
done all such other acts as may be necessary to make such sale or sales of all
or any portion of the Pledged Stock pursuant to this Section 7.7 valid and
binding and in compliance with any applicable Requirement of Law. Each Grantor
further agrees that a breach of any of the covenants contained in this Section
7.7 will cause irreparable injury to the First Lien Administrative Agent and the
other First Lien Secured Parties, that the First Lien Administrative Agent and
the other First Lien Secured Parties have no adequate remedy at law in respect
of such breach and, as a consequence, that each and every covenant contained in
this Section 7.7 shall be specifically enforceable against such Grantor, and
such Grantor hereby waives and agrees not to assert any defenses against an
action for specific performance of such covenants except for a defense that no
First Lien Event of Default has occurred under the Credit Agreement.
7.8 Deficiency. Each Grantor shall remain liable for any deficiency
if the proceeds of any sale or other disposition of the First Lien Collateral
are insufficient to pay its First Lien Obligations and the fees and
disbursements of any attorneys employed by the First Lien Administrative Agent
or any other First Lien Secured Party to collect such deficiency.
7.9 Section 7 for the Exclusive Benefit of the First Lien
Administrative Agent and the other First Lien Secured Parties. For the avoidance
of doubt, the parties to this Agreement hereby agree and acknowledge that the
provisions of this Section 7 are for the exclusive benefit of the First Lien
Administrative Agent and the other First Lien Secured Parties and that the
provisions of this Section 7 do not apply to the Second Lien Administrative
Agent or the other Second Lien Secured Parties in any manner whatsoever.
Section 8. SECOND LIEN ADMINISTRATIVE AGENT REMEDIAL PROVISIONS
Subject, in each case, to the provisions of Section 14 of the Credit
Agreement, each Grantor covenants and agrees with the Second Lien Administrative
Agent and the other Second Lien Secured Parties that, from and after the date of
this Agreement until the Discharge of Second Lien Obligations:
8.1 Certain Matters Relating to Receivables. (a) The Second Lien
Administrative Agent hereby authorizes each Grantor to collect such Grantor's
Receivables, and the Second Lien Administrative Agent may curtail or terminate
said authority at any time after the occurrence and during the continuance of a
Second Lien Event of Default. If required by the Second Lien Administrative
Agent at any time after the occurrence and during the continuance of a Second
Lien Event of Default, any payments of Receivables, when collected by any
Grantor, (i) shall be forthwith (and, in any event, within two Business Days)
deposited by such Grantor in the exact form received, duly indorsed by such
Grantor to the Second Lien Administrative Agent if required, in a Collateral
Account over which the Second Lien Administrative Agent has control, subject to
withdrawal by the Second Lien Administrative Agent for the account of the Second
Lien Secured Parties only as provided in Section 8.5, and (ii) until so turned
over, shall be held by such Grantor in trust for the Second Lien Administrative
Agent and the other Second Lien Secured Parties, segregated from other funds of
such Grantor. After the occurrence of a Second Lien Event of Default, each such
deposit of Proceeds of Receivables shall be accompanied by a report identifying
in reasonable detail the nature and source of the payments included in the
deposit.
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(b) At the Second Lien Administrative Agent's request, after the
occurrence of a Second Lien Event of Default each Grantor shall deliver to the
Second Lien Administrative Agent all original and other documents evidencing,
and relating to, the agreements and transactions which gave rise to the
Receivables, including, without limitation, all original orders, invoices and
shipping receipts and permit any of the Second Lien Administrative Agent's
officers, employees or agents, at any time or times, in the name of the Second
Lien Administrative Agent, any designee of the Second Lien Administrative Agent
or the Borrower, to confirm the validity, amount or any other matter relating to
Receivables by mail, telephone, electronic communication, personal inspection or
otherwise. The Borrower shall cooperate fully with the Second Lien
Administrative Agent in an effort to facilitate and promptly conclude any such
process.
8.2 Communications with Obligors; Grantors Remain Liable. (a) The
Second Lien Administrative Agent in its own name or in the name of others may at
any time after the occurrence and during the continuance of a Second Lien Event
of Default communicate with obligors under the Receivables and parties to the
Contracts to verify with them to the Second Lien Administrative Agent's
satisfaction the existence, amount and terms of any Receivables or Contracts.
(b) Upon the request of the Second Lien Administrative Agent, at any
time after the occurrence and during the continuance of a Second Lien Event of
Default, each Grantor shall notify obligors on the Receivables and parties to
the Contracts that the Receivables and the Contracts have been assigned to the
Second Lien Administrative Agent for the ratable benefit of the Second Lien
Secured Parties and that payments in respect thereof shall be made directly to
the Second Lien Administrative Agent.
(c) Anything herein to the contrary notwithstanding, each Grantor
shall remain liable under each of the Receivables and Contracts 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
thereto. Neither the Second Lien Administrative Agent nor any other Second Lien
Secured Party shall have any obligation or liability under any Receivable (or
any agreement giving rise thereto) or Contract by reason of or arising out of
this Agreement or the receipt by the Second Lien Administrative Agent or any
Lender of any payment relating thereto, nor shall the Second Lien Administrative
Agent or any other Second Lien Secured Party be obligated in any manner to
perform any of the obligations of any Grantor under or pursuant to any
Receivable (or any agreement giving rise thereto) or Contract, 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
thereunder, 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.
8.3 Investment Property. (a) Unless a Second Lien Event of Default
shall have occurred and be continuing and the Second Lien Administrative Agent
shall have given notice to the relevant Grantor of the Second Lien
Administrative Agent's intent to exercise its corresponding rights pursuant to
Section 8.3(b), each Grantor shall be permitted to receive all cash dividends
paid in respect of the Pledged Stock and all payments made in respect of the
Pledged Notes, to the extent permitted in the Credit Agreement, and to exercise
all voting and corporate or other organizational rights with respect to the
Investment Property; provided, however, that no vote shall be cast or corporate
or other organizational right exercised or other action taken which, in the
Second Lien Administrative Agent's reasonable judgment, would impair the Second
Lien Collateral or which would be inconsistent with or result in any violation
of any provision of the Credit Agreement, this Agreement or any other Loan
Document.
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(b) If a Second Lien Event of Default shall occur and be continuing
and the Second Lien Administrative Agent shall give notice of its intent to
exercise such rights to the relevant Grantor or Grantors, (i) the Second Lien
Administrative Agent shall have the right to receive any and all cash dividends,
payments or other Proceeds paid in respect of the Investment Property and make
application thereof to the Second Lien Obligations in such order as the Second
Lien Administrative Agent may determine, and (ii) any or all of the Investment
Property shall be registered in the name of the Second Lien Administrative Agent
or its nominee, and the Second Lien Administrative Agent or its nominee may
thereafter exercise (x) all voting, corporate and other rights pertaining to
such Investment Property at any meeting of shareholders of the relevant Issuer
or Issuers or otherwise and (y) any and all rights of conversion, exchange and
subscription and any other rights, privileges or options pertaining to such
Investment Property as if it were the absolute owner thereof (including, without
limitation, the right to exchange at its discretion any and all of the
Investment Property upon the merger, consolidation, reorganization,
recapitalization or other fundamental change in the corporate or other
organizational structure of any Issuer, or upon the exercise by any Grantor or
the Second Lien Administrative Agent of any right, privilege or option
pertaining to such Investment Property, and in connection therewith, the right
to deposit and deliver any and all of the Investment Property with any
committee, depositary, transfer agent, registrar or other designated agency upon
such terms and conditions as the Second Lien Administrative Agent may
determine), all without liability except to account for property actually
received by it, but the Second Lien Administrative Agent shall have no duty to
any Grantor to exercise any such right, privilege or option and shall not be
responsible for any failure to do so or delay in so doing.
(c) Each Grantor hereby authorizes and instructs each Issuer of any
Pledged Stock or Pledged Notes pledged by such Grantor hereunder to (i) comply
with any instruction received by it from the Second Lien Administrative Agent in
writing that (x) states that a Second Lien Event of Default has occurred and is
continuing and (y) is otherwise in accordance with the terms of this Agreement,
without any other or further instructions from such Grantor, and each Grantor
agrees that each Issuer shall be fully protected in so complying, and (ii)
unless otherwise expressly permitted hereby, pay any dividends or other payments
with respect to the Pledged Stock and Pledged Notes directly to the Second Lien
Administrative Agent.
(d) If a Second Lien Event of Default shall have occurred and be
continuing, the Second Lien Administrative Agent shall have the right to apply
the balance from any Deposit Account or instruct the bank at which any Deposit
Account is maintained to pay the balance of any Deposit Account to or for the
benefit of the Second Lien Administrative Agent.
8.4 Proceeds to be Turned Over To Second Lien Administrative Agent.
In addition to the rights of the Second Lien Administrative Agent and the other
Second Lien Secured Parties specified in Section 8.1 with respect to payments of
Receivables, if a Second Lien Event of Default shall occur and be continuing,
all Proceeds received by any Grantor consisting of cash, checks, Cash
Equivalents and other near-cash items shall be held by such Grantor in trust for
the Second Lien Administrative Agent and the other Second Lien Secured Parties,
segregated from other funds of such Grantor, and shall, forthwith upon receipt
by such Grantor, be turned over to the Second Lien Administrative Agent in the
exact form received by such Grantor (duly indorsed by such Grantor to the Second
Lien Administrative Agent, if required). All Proceeds received by the Second
Lien Administrative Agent hereunder shall be held by the Second Lien
Administrative Agent in a Collateral Account maintained under its sole dominion
and control. All Proceeds while held by the Second Lien Administrative Agent in
a Collateral Account (or by such Grantor in trust for the Second Lien
Administrative Agent and the other Second Lien Secured Parties) shall continue
to be held as collateral security for all the Second Lien Obligations and shall
not constitute payment thereof until applied as provided in Section 8.5.
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8.5 Application of Proceeds. If a Second Lien Event of Default shall
have occurred and be continuing, at any time at the Second Lien Administrative
Agent's election, the Second Lien Administrative Agent may apply all or any part
of Proceeds constituting Second Lien Collateral, whether or not held in any
Collateral Account, in payment of the Second Lien Obligations in the following
order:
(a) First, to the payment of all costs and expenses of any sale,
collection or other realization on the Second Lien Collateral, including
reasonable compensation to the Second Lien Administrative Agent, the
Administrative Agent and their agents and counsel, and reimbursement for all
other costs, expenses, liabilities and advances made or incurred by Second Lien
Administrative Agent or the Administrative Agent in connection therewith
(including as described in Section 8.6 hereof), and all amounts for which Second
Lien Administrative Agent or the Administrative Agent is entitled to
indemnification hereunder and all advances made by Second Lien Administrative
Agent or the Administrative Agent hereunder for the account of the applicable
Grantor, and to the payment of all costs and expenses paid or incurred by Second
Lien Administrative Agent or the Administrative Agent in connection with the
exercise of any right or remedy hereunder or under the Credit Agreement or any
other Loan Document and to the payment or reimbursement of all indemnification
obligations, fees, costs and expenses owing to the Administrative Agent or the
Second Lien Administrative Agent hereunder or under the Credit Agreement or any
other Loan Document, all in accordance with the terms hereof or thereof;
(b) Second, to pay accrued and unpaid fees and expenses of the Second
Lien Secured Parties under the Loan Documents;
(c) Third, for application by it towards payment of amounts then due
and owing and remaining unpaid in respect of the Second Lien Obligations, pro
rata among the Second Lien Facility Lenders according to the amounts of the
Second Lien Obligations then due and owing and remaining unpaid to the Second
Lien Facility Lenders;
(d) Fourth, for application by it towards prepayment of the Second
Lien Obligations, pro rata among the Second Lien Facility Lenders according to
the amounts of the Second Lien Obligations then held by the Second Lien Facility
Lenders; and
(e) Fifth, any balance of such Proceeds remaining after the Discharge
of Second Lien Obligations shall be paid over to the Borrower or to whomsoever
may be lawfully entitled to receive the same.
8.6 Code and Other Remedies. If a Second Lien Event of Default shall
occur and be continuing, the Second Lien Administrative Agent, on behalf of the
Second Lien Secured Parties, may exercise, in addition to all other rights and
remedies granted to them in this Agreement and in any other instrument or
agreement securing, evidencing or relating to the Second Lien Obligations, all
rights and remedies of a secured party under the New York UCC or any other
applicable law. Without limiting the generality of the foregoing, the Second
Lien Administrative Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law) to or upon any Grantor or any other Person (all and each of
which demands, defenses, advertisements and notices are hereby waived), may in
such circumstances forthwith collect, receive, appropriate and realize upon the
Second Lien Collateral, or any part thereof, and/or may forthwith sell, lease,
assign, give option or options to purchase, or otherwise dispose of and deliver
the Second Lien Collateral or any part thereof (or contract to do any of the
foregoing), in one or more parcels at public or private sale or sales, at any
exchange, broker's board or office of the Second Lien Administrative Agent or
27
any other Second Lien Secured Party or elsewhere upon such terms and conditions
as it may deem advisable and at such prices as it may deem best, for cash or on
credit or for future delivery without assumption of any credit risk. The Second
Lien Administrative Agent or any other Second Lien Secured Party shall have the
right upon any such public sale or sales, and, to the extent permitted by law,
upon any such private sale or sales, to purchase the whole or any part of the
Second Lien Collateral so sold, free of any right or equity of redemption in any
Grantor, which right or equity is hereby waived and released. Each Grantor
further agrees, at the Second Lien Administrative Agent's request, to assemble
the Second Lien Collateral and make it available to the Second Lien
Administrative Agent at places which the Second Lien Administrative Agent shall
reasonably select, whether at such Grantor's premises or elsewhere. The Second
Lien Administrative Agent shall apply the net proceeds of any action taken by it
pursuant to this Section 8.6, after deducting all reasonable costs and expenses
of every kind incurred in connection therewith or incidental to the care or
safekeeping of any of the Second Lien Collateral or in any way relating to the
Second Lien Collateral or the rights of the Second Lien Administrative Agent and
the other Second Lien Secured Parties hereunder, including, without limitation,
reasonable attorneys' fees and disbursements, to the payment in whole or in part
of the Second Lien Obligations, in such order as the Second Lien Administrative
Agent may elect, and only after such application and after the payment by the
Second Lien Administrative Agent of any other amount required by any provision
of law, including, without limitation, Section 9-615(a)(3) of the New York UCC,
need the Second Lien Administrative Agent account for the surplus, if any, to
any Grantor. To the extent permitted by applicable law, each Grantor waives all
claims, damages and demands it may acquire against the Second Lien
Administrative Agent or any other Second Lien Secured Party arising out of the
exercise by them of any rights hereunder. If any notice of a proposed sale or
other disposition of Second Lien Collateral shall be required by law, such
notice shall be deemed reasonable and proper if given at least 10 days before
such sale or other disposition.
8.7 Registration Rights. (a) If the Second Lien Administrative Agent
shall determine to exercise its right to sell any or all of the Pledged Stock
pursuant to Section 8.6, and if in the opinion of the Second Lien Administrative
Agent it is necessary or advisable to have the Pledged Stock, or that portion
thereof to be sold, registered under the provisions of the Securities Act, the
relevant Grantor will cause the Issuer thereof to (i) execute and deliver, and
cause the directors and officers of such Issuer to execute and deliver, all such
instruments and documents, and do or cause to be done all such other acts as may
be, in the opinion of the Second Lien Administrative Agent, necessary or
advisable to register the Pledged Stock, or that portion thereof to be sold,
under the provisions of the Securities Act, (ii) use its best efforts to cause
the registration statement relating thereto to become effective and to remain
effective for a period of one year from the date of the second public offering
of the Pledged Stock, or that portion thereof to be sold, and (iii) make all
amendments thereto and/or to the related prospectus which, in the opinion of the
Second Lien Administrative Agent, are necessary or advisable, all in conformity
with the requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto. Each Grantor agrees to
cause such Issuer to comply with the provisions of the securities or "Blue Sky"
laws of any and all jurisdictions which the Second Lien Administrative Agent
shall designate and to make available to its security holders, as soon as
practicable, an earnings statement (which need not be audited) which will
satisfy the provisions of Section 11(a) of the Securities Act.
(b) Each Grantor recognizes that the Second Lien Administrative Agent
may be unable to effect a public sale of any or all the Pledged Stock, by reason
of certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers which will be obliged
to agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof. Each
Grantor acknowledges and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The Second Lien
Administrative Agent shall be under no obligation to delay a sale of any of the
Pledged Stock for the period of time necessary to permit the Issuer thereof to
register such securities for public sale under the Securities Act, or under
applicable state securities laws, even if such Issuer would agree to do so.
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(c) Each Grantor agrees to use its best efforts to do or cause to be
done all such other acts as may be necessary to make such sale or sales of all
or any portion of the Pledged Stock pursuant to this Section 8.7 valid and
binding and in compliance with any applicable Requirement of Law. Each Grantor
further agrees that a breach of any of the covenants contained in this Section
8.7 will cause irreparable injury to the Second Lien Administrative Agent and
the other Second Lien Secured Parties, that the Second Lien Administrative Agent
and the other Second Lien Secured Parties have no adequate remedy at law in
respect of such breach and, as a consequence, that each and every covenant
contained in this Section 8.7 shall be specifically enforceable against such
Grantor, and such Grantor hereby waives and agrees not to assert any defenses
against an action for specific performance of such covenants except for a
defense that no Second Lien Event of Default has occurred under the Credit
Agreement.
8.8 Deficiency. Each Grantor shall remain liable for any deficiency
if the proceeds of any sale or other disposition of the Second Lien Collateral
are insufficient to pay its Second Lien Obligations and the fees and
disbursements of any attorneys employed by the Second Lien Administrative Agent
or any other Second Lien Secured Party to collect such deficiency.
8.9 Section 8 for the Exclusive Benefit of the Second Lien
Administrative Agent and the other Second Lien Secured Parties. For the
avoidance of doubt, the parties to this Agreement hereby agree and acknowledge
that the provisions of this Section 8 are for the exclusive benefit of the
Second Lien Administrative Agent and the other Second Lien Secured Parties and
that the provisions of this Section 8 do not apply to the First Lien
Administrative Agent or the other First Lien Secured Parties in any manner
whatsoever.
Section 9. THE FIRST LIEN ADMINISTRATIVE AGENT
Subject, in each case, to the provisions of Section 14 of the Credit
Agreement, each Grantor covenants and agrees with the First Lien Administrative
Agent and the other First Lien Secured Parties that:
9.1 First Lien Administrative Agent's Appointment as
Attorney-in-Fact, etc. (a) Each Grantor hereby irrevocably constitutes and
appoints the First Lien Administrative Agent and any officer or agent thereof,
with full power of substitution, as its true and lawful attorney-in-fact with
full irrevocable power and authority in the place and stead of such Grantor and
in the name of such Grantor or in its own name, for the purpose of carrying out
the terms of this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement, and, without limiting
the generality of the foregoing, each Grantor hereby gives the First Lien
Administrative Agent the power and right, on behalf of such Grantor, without
notice to or assent by such Grantor, to do any or all of the following:
(i) in the name of such Grantor or its own name, or otherwise, take
possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under any
Receivable or Contract or with respect to any other First Lien Collateral
and file any claim or take any other action or proceeding in any court of
law or equity or otherwise deemed appropriate by the First Lien
Administrative Agent for the purpose of collecting any and all such moneys
due under any Receivable or Contract or with respect to any other First
Lien Collateral whenever payable;
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(ii) in the case of any Intellectual Property, execute and deliver,
and have recorded, any and all agreements, instruments, documents and
papers as the First Lien Administrative Agent may request to evidence the
First Lien Administrative Agent's and the other First Lien Secured Parties'
security interest in such Intellectual Property and the goodwill and
general intangibles of such Grantor relating thereto or represented
thereby;
(iii) pay or discharge taxes and Liens levied or placed on or
threatened against the First Lien Collateral, effect any repairs or any
insurance called for by the terms of this Agreement and pay all or any part
of the premiums therefor and the costs thereof;
(iv) execute, in connection with any sale provided for in Section 7.6
or 7.7, any indorsements, assignments or other instruments of conveyance or
transfer with respect to the First Lien Collateral; and
(v) (1) direct any party liable for any payment under any of the First
Lien Collateral to make payment of any and all moneys due or to become due
thereunder directly to the First Lien Administrative Agent or as the First
Lien Administrative Agent shall direct; (2) ask or demand for, collect, and
receive payment of and receipt for, any and all moneys, claims and other
amounts due or to become due at any time in respect of or arising out of
any First Lien Collateral; (3) sign and indorse any invoices, freight or
express bills, bills of lading, storage or warehouse receipts, drafts
against debtors, assignments, verifications, notices and other documents in
connection with any of the First Lien Collateral; (4) commence and
prosecute any suits, actions or proceedings at law or in equity in any
court of competent jurisdiction to collect the First Lien Collateral or any
portion thereof and to enforce any other right in respect of any First Lien
Collateral; (5) defend any suit, action or proceeding brought against such
Grantor with respect to any First Lien Collateral; (6) settle, compromise
or adjust any such suit, action or proceeding and, in connection therewith,
give such discharges or releases as the First Lien Administrative Agent may
deem appropriate; (7) assign any Copyright, Patent or Trademark (along with
the goodwill of the business to which any such Copyright, Patent or
Trademark pertains), throughout the world for such term or terms, on such
conditions, and in such manner, as the First Lien Administrative Agent
shall in its sole discretion determine; and (8) generally, sell, transfer,
pledge and make any agreement with respect to or otherwise deal with any of
the First Lien Collateral as fully and completely as though the First Lien
Administrative Agent were the absolute owner thereof for all purposes, and
do, at the First Lien Administrative Agent's option and such Grantor's
expense, at any time, or from time to time, all acts and things which the
First Lien Administrative Agent deems necessary to protect, preserve or
realize upon the First Lien Collateral and the First Lien Administrative
Agent's and the other First Lien Secured Parties' security interests
therein and to effect the intent of this Agreement, all as fully and
effectively as such Grantor might do.
Anything in this Section 9.1(a) to the contrary notwithstanding, the
First Lien Administrative Agent agrees that it will not exercise any rights
under the power of attorney provided for in this Section 9.1(a) unless a First
Lien Event of Default shall have occurred and be continuing.
(b) If any Grantor fails to perform or comply with any of its
agreements contained herein, the First Lien Administrative Agent, at its option,
but without any obligation so to do, may perform or comply, or otherwise cause
performance or compliance, with such agreement.
(c) The expenses of the First Lien Administrative Agent incurred in
connection with actions undertaken as provided in this Section 9.1, together
with interest thereon at a rate per annum equal to the highest rate per annum at
which interest would then be payable on any category of past due ABR Loans under
the Credit Agreement, from the date of payment by the First Lien Administrative
Agent to the date reimbursed by the relevant Grantor, shall be payable by such
Grantor to the First Lien Administrative Agent on demand.
30
(d) Each Grantor hereby ratifies all that said attorneys shall
lawfully do or cause to be done by virtue hereof. All powers, authorizations and
agencies contained in this Agreement are coupled with an interest and are
irrevocable until this Agreement is terminated and the security interests
created hereby are released.
9.2 Duty of First Lien Administrative Agent. The First Lien
Administrative Agent's sole duty with respect to the custody, safekeeping and
physical preservation of the First Lien Collateral in its possession, under
Section 9-207 of the New York UCC or otherwise, shall be to deal with it in the
same manner as the First Lien Administrative Agent deals with similar property
for its own account. Neither the First Lien Administrative Agent, any other
First Lien Secured Party nor any of their respective officers, directors,
employees or agents shall be liable for failure to demand, collect or realize
upon any of the First Lien Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any First Lien Collateral
upon the request of any Grantor or any other Person or to take any other action
whatsoever with regard to the First Lien Collateral or any part thereof. The
powers conferred on the First Lien Administrative Agent and the other First Lien
Secured Parties hereunder are solely to protect the First Lien Administrative
Agent's and the other First Lien Secured Parties' interests in the First Lien
Collateral and shall not impose any duty upon the First Lien Administrative
Agent or any other First Lien Secured Party to exercise any such powers. The
First Lien Administrative Agent and the other First Lien Secured Parties shall
be accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
employees or agents shall be responsible to any Grantor for any act or failure
to act hereunder, except for their own gross negligence or willful misconduct.
9.3 Execution of Financing Statements. Pursuant to any applicable
law, each Grantor authorizes the First Lien Administrative Agent to file or
record financing statements and other filing or recording documents or
instruments with respect to the First Lien Collateral without the signature of
such Grantor in such form and in such offices as the First Lien Administrative
Agent determines appropriate to perfect the security interests of the First Lien
Administrative Agent under this Agreement. Each Grantor authorizes the First
Lien Administrative Agent to use the collateral description "all personal
property, whether now owned or hereafter acquired" in any such financing
statements. Each Grantor hereby ratifies and authorizes the filing by the First
Lien Administrative Agent of any financing statement with respect to the First
Lien Collateral made prior to the date hereof.
9.4 Authority of First Lien Administrative Agent. Each Grantor
acknowledges that the rights and responsibilities of the First Lien
Administrative Agent under this Agreement with respect to any action taken by
the First Lien Administrative Agent or the exercise or non-exercise by the First
Lien Administrative Agent of any option, voting right, request, judgment or
other right or remedy provided for herein or resulting or arising out of this
Agreement shall, as between the First Lien Administrative Agent and the other
First Lien Secured Parties, be governed by the Credit Agreement and by such
other agreements with respect thereto as may exist from time to time among them,
but, as between the First Lien Administrative Agent and the Grantors, the First
Lien Administrative Agent shall be conclusively presumed to be acting as agent
for the First Lien Secured Parties with full and valid authority so to act or
refrain from acting, and no Grantor shall be under any obligation, or
entitlement, to make any inquiry respecting such authority.
9.5 Intercreditor Provisions. For the avoidance of doubt, the First
Lien Administrative Agent expressly agrees and acknowledges that the rights and
obligations of the First Lien Administrative Agent are subject to the terms and
conditions of the intercreditor provisions of Section 14 of the Credit
Agreement.
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Section 10. THE SECOND LIEN ADMINISTRATIVE AGENT
Subject, in each case, to the provisions of Section 14 of the Credit
Agreement, each Grantor covenants and agrees with the Second Lien Administrative
Agent and the other Second Lien Secured Parties that:
10.1 Second Lien Administrative Agent's Appointment as
Attorney-in-Fact, etc. (a) Each Grantor hereby irrevocably constitutes and
appoints the Second Lien Administrative Agent and any officer or agent thereof,
with full power of substitution, as its true and lawful attorney-in-fact with
full irrevocable power and authority in the place and stead of such Grantor and
in the name of such Grantor or in its own name, for the purpose of carrying out
the terms of this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement, and, without limiting
the generality of the foregoing, each Grantor hereby gives the Second Lien
Administrative Agent the power and right, on behalf of such Grantor, without
notice to or assent by such Grantor, to do any or all of the following:
(i) in the name of such Grantor or its own name, or otherwise, take
possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under any
Receivable or Contract or with respect to any other Second Lien Collateral
and file any claim or take any other action or proceeding in any court of
law or equity or otherwise deemed appropriate by the Second Lien
Administrative Agent for the purpose of collecting any and all such moneys
due under any Receivable or Contract or with respect to any other Second
Lien Collateral whenever payable;
(ii) in the case of any Intellectual Property, execute and deliver,
and have recorded, any and all agreements, instruments, documents and
papers as the Second Lien Administrative Agent may request to evidence the
Second Lien Administrative Agent's and the other Second Lien Secured
Parties' security interest in such Intellectual Property and the goodwill
and general intangibles of such Grantor relating thereto or represented
thereby;
(iii)pay or discharge taxes and Liens levied or placed on or
threatened against the Second Lien Collateral, effect any repairs or any
insurance called for by the terms of this Agreement and pay all or any part
of the premiums therefor and the costs thereof;
(iv) execute, in connection with any sale provided for in Section 8.6
or 8.7, any indorsements, assignments or other instruments of conveyance or
transfer with respect to the Second Lien Collateral; and
(v) (1) direct any party liable for any payment under any of the
Second Lien Collateral to make payment of any and all moneys due or to
become due thereunder directly to the Second Lien Administrative Agent or
as the Second Lien Administrative Agent shall direct; (2) ask or demand
for, collect, and receive payment of and receipt for, any and all moneys,
claims and other amounts due or to become due at any time in respect of or
arising out of any Second Lien Collateral; (3) sign and indorse any
invoices, freight or express bills, bills of lading, storage or warehouse
receipts, drafts against debtors, assignments, verifications, notices and
other documents in connection with any of the Second Lien Collateral; (4)
commence and prosecute any suits, actions or proceedings at law or in
equity in any court of competent jurisdiction to collect the Second Lien
Collateral or any portion thereof and to enforce any other right in respect
of any Second Lien Collateral; (5) defend any suit, action or proceeding
32
brought against such Grantor with respect to any Second Lien Collateral;
(6) settle, compromise or adjust any such suit, action or proceeding and,
in connection therewith, give such discharges or releases as the Second
Lien Administrative Agent may deem appropriate; (7) assign any Copyright,
Patent or Trademark (along with the goodwill of the business to which any
such Copyright, Patent or Trademark pertains), throughout the world for
such term or terms, on such conditions, and in such manner, as the Second
Lien Administrative Agent shall in its sole discretion determine; and (8)
generally, sell, transfer, pledge and make any agreement with respect to or
otherwise deal with any of the Second Lien Collateral as fully and
completely as though the Second Lien Administrative Agent were the absolute
owner thereof for all purposes, and do, at the Second Lien Administrative
Agent's option and such Grantor's expense, at any time, or from time to
time, all acts and things which the Second Lien Administrative Agent deems
necessary to protect, preserve or realize upon the Second Lien Collateral
and the Second Lien Administrative Agent's and the other Second Lien
Secured Parties' security interests therein and to effect the intent of
this Agreement, all as fully and effectively as such Grantor might do.
Anything in this Section 10.1(a) to the contrary notwithstanding, the
Second Lien Administrative Agent agrees that it will not exercise any rights
under the power of attorney provided for in this Section 10.1(a) unless a Second
Lien Event of Default shall have occurred and be continuing.
(b) If any Grantor fails to perform or comply with any of its
agreements contained herein, the Second Lien Administrative Agent, at its
option, but without any obligation so to do, may perform or comply, or otherwise
cause performance or compliance, with such agreement.
(c) The expenses of the Second Lien Administrative Agent incurred in
connection with actions undertaken as provided in this Section 10.1, together
with interest thereon at a rate per annum equal to the highest rate per annum at
which interest would then be payable on any category of past due ABR Loans under
the Credit Agreement, from the date of payment by the Second Lien Administrative
Agent to the date reimbursed by the relevant Grantor, shall be payable by such
Grantor to the Second Lien Administrative Agent on demand.
(d) Each Grantor hereby ratifies all that said attorneys shall
lawfully do or cause to be done by virtue hereof. All powers, authorizations and
agencies contained in this Agreement are coupled with an interest and are
irrevocable until this Agreement is terminated and the security interests
created hereby are released.
10.2 Duty of Second Lien Administrative Agent. The Second Lien
Administrative Agent's sole duty with respect to the custody, safekeeping and
physical preservation of the Second Lien Collateral in its possession, under
Section 9-207 of the New York UCC or otherwise, shall be to deal with it in the
same manner as the Second Lien Administrative Agent deals with similar property
for its own account. Neither the Second Lien Administrative Agent, any other
Second Lien Secured Party nor any of their respective officers, directors,
employees or agents shall be liable for failure to demand, collect or realize
upon any of the Second Lien Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any Second Lien Collateral
upon the request of any Grantor or any other Person or to take any other action
whatsoever with regard to the Second Lien Collateral or any part thereof. The
powers conferred on the Second Lien Administrative Agent and the other Second
Lien Secured Parties hereunder are solely to protect the Second Lien
Administrative Agent's and the other Second Lien Secured Parties' interests in
the Second Lien Collateral and shall not impose any duty upon the Second Lien
Administrative Agent or any other Second Lien Secured Party to exercise any such
powers. The Second Lien Administrative Agent and the other Second Lien Secured
Parties shall be accountable only for amounts that they actually receive as a
result of the exercise of such powers, and neither they nor any of their
officers, directors, employees or agents shall be responsible to any Grantor for
any act or failure to act hereunder, except for their own gross negligence or
willful misconduct.
33
10.3 Execution of Financing Statements. Pursuant to any applicable
law, each Grantor authorizes the Second Lien Administrative Agent to file or
record financing statements and other filing or recording documents or
instruments with respect to the Second Lien Collateral without the signature of
such Grantor in such form and in such offices as the Second Lien Administrative
Agent determines appropriate to perfect the security interests of the Second
Lien Administrative Agent under this Agreement. Each Grantor authorizes the
Second Lien Administrative Agent to use the collateral description "all personal
property, whether now owned or hereafter acquired" in any such financing
statements. Each Grantor hereby ratifies and authorizes the filing by the Second
Lien Administrative Agent of any financing statement with respect to the Second
Lien Collateral made prior to the date hereof.
10.4 Authority of Second Lien Administrative Agent. Each Grantor
acknowledges that the rights and responsibilities of the Second Lien
Administrative Agent under this Agreement with respect to any action taken by
the Second Lien Administrative Agent or the exercise or non-exercise by the
Second Lien Administrative Agent of any option, voting right, request, judgment
or other right or remedy provided for herein or resulting or arising out of this
Agreement shall, as between the Second Lien Administrative Agent and the Second
Lien Secured Parties, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Second Lien Administrative Agent and the Grantors, the Second
Lien Administrative Agent shall be conclusively presumed to be acting as agent
for the Second Lien Secured Parties with full and valid authority so to act or
refrain from acting, and no Grantor shall be under any obligation, or
entitlement, to make any inquiry respecting such authority.
10.5 Intercreditor Provisions. For the avoidance of doubt, the Second
Lien Administrative Agent expressly agrees and acknowledges that the rights and
obligations of the Second Lien Administrative Agent are subject to the terms and
conditions intercreditor provisions of Section 14 of the Credit Agreement.
Section 11. MISCELLANEOUS
11.1 Amendments in Writing. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except in
accordance with Section 15.1 of the Credit Agreement.
11.2 Notices. All notices, requests and demands to or upon any Agent
or any Grantor hereunder shall be effected in the manner provided for in Section
15.2 of the Credit Agreement; provided that any such notice, request or demand
to or upon any Guarantor shall be addressed to such Guarantor at its notice
address set forth on Schedule 1.
11.3 No Waiver by Course of Conduct; Cumulative Remedies. Neither any
Agent nor any other Secured Party shall by any act (except by a written
instrument pursuant to Section 11.1), delay, indulgence, omission or otherwise
be deemed to have waived any right or remedy hereunder or to have acquiesced in
any First Lien Default, Second Lien Default, First Lien Event of Default or
Second Lien Event of Default, as applicable. No failure to exercise, nor any
delay in exercising, on the part of any Agent or any other Secured Party, any
right, power or privilege hereunder shall operate as a waiver thereof. No single
or partial exercise of any right, power or privilege hereunder shall preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege. A waiver by any Agent or any other Secured Party of any right or
remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which such Agent or such other Secured Party would otherwise
have on any future occasion. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other rights or remedies provided by law.
34
11.4 Enforcement Expenses; Indemnification. (a) Each Guarantor agrees
to pay or reimburse each Agent and each other Secured Party for all its costs
and expenses incurred in collecting against such Guarantor under the guaranty
contained in Section 12 of the Credit Agreement or otherwise enforcing or
preserving any rights under this Agreement and the other Loan Documents to which
such Guarantor is a party, including, without limitation, the fees and
disbursements of counsel (including the allocated fees and expenses of in-house
counsel) to each Agent and of counsel to each other Secured Party.
(b) Each Guarantor agrees to pay, and to save each Agent and each
other Secured Party harmless from, any and all liabilities with respect to, or
resulting from any delay in paying, any and all stamp, excise, sales or other
taxes which may be payable or determined to be payable with respect to any of
the Collateral or in connection with any of the transactions contemplated by
this Agreement.
(c) Each Guarantor agrees to pay, and to save each Agent and each
other Secured Party harmless from, any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect to the execution, delivery,
enforcement, performance and administration of this Agreement to the extent the
Borrower would be required to do so pursuant to the Credit Agreement.
(d) The agreements in this Section 11.4 shall survive repayment of
the Obligations and any other amounts payable under the Credit Agreement and the
other Loan Documents.
11.5 Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of each Grantor and shall inure to the benefit of each
Agent and each other Secured Party and their respective successors and assigns;
provided that no Grantor may assign, transfer or delegate any of its rights or
obligations under this Agreement without the prior written consent of each
Agent.
11.6 Set-Off. Each Grantor hereby irrevocably authorizes each Agent
and each other Secured Party and any Affiliate thereof at any time and from time
to time after the occurrence and during the continuance of an Event of Default,
without notice to such Grantor or any other Grantor, any such notice being
expressly waived by each Grantor, to set-off and appropriate and apply any and
all deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Agent or such Secured Party or such
Affiliate to or for the credit or the account of such Grantor, or any part
thereof in such amounts as such Agent or such Secured Party may elect, against
and on account of the Obligations and liabilities of such Grantor to such Agent
or such Secured Party hereunder and under the other Loan Documents and claims of
every nature and description of such Agent or such Secured Party against such
Grantor, in any currency, whether arising hereunder, under the Credit Agreement,
any other Loan Document or otherwise, as such Agent or such Secured Party may
elect, whether or not any Agent or any Secured Party has made any demand for
payment and although such obligations, liabilities and claims may be contingent
or unmatured. The applicable Agent or Secured Party shall notify such Grantor
promptly of any such set-off and the application made by such Agent or such
Secured Party of the proceeds thereof, provided that the failure to give such
notice shall not affect the validity of such set-off and application. The rights
of each Agent and each Secured Party under this Section 11.6 are in addition to
other rights and remedies (including, without limitation, other rights of
set-off) which such Agent or such Secured Party may have.
35
11.7 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts (including
by telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
11.8 Severability. Any provision of this Agreement which 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 provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
11.9 Section Headings. The Section headings used in this Agreement
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
11.10 Integration. This Agreement and the other Loan Documents
represent the agreement of the Grantors, each Agent and the other Secured
Parties with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by any Agent or any other
Secured Party relative to subject matter hereof and thereof not expressly set
forth or referred to herein or in the other Loan Documents.
11.11 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
11.12 Submission To Jurisdiction; Waivers. Each Grantor hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to such Grantor at its
address referred to in Section 11.2 or at such other address of which each Agent
shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the right
to xxx in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this Section any special, exemplary, punitive or consequential damages.
11.13 Acknowledgements. Each Grantor hereby acknowledges that:
36
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents to which it is a party;
(b) neither any Agent nor any other Secured Party has any fiduciary
relationship with or duty to any Grantor arising out of or in connection with
this Agreement or any of the other Loan Documents, and the relationship between
the Grantors, on the one hand, and each Agent and the other Secured Parties, on
the other hand, in connection herewith or therewith is solely that of debtor and
creditor; and
(c) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among any
of the Secured Parties or among the Grantors and any of the Secured Parties.
11.14 Additional Grantors. Each Subsidiary of the Borrower that is
required to become a party to this Agreement pursuant to Section 6.9 of the
Credit Agreement shall become a Grantor for all purposes of this Agreement upon
execution and delivery by such Subsidiary of an Assumption Agreement in the form
of Annex 1 hereto.
11.15 Releases. (a) Subject to the provisions of Section 14 of the
Credit Agreement:
(i) Upon the Discharge of First Lien Obligations, the First Lien
Collateral shall be released from the Liens in favor of the First Lien
Administrative Agent and the other First Lien Secured Parties created
hereby, this Agreement shall terminate with respect to the First Lien
Administrative Agent and the other First Lien Secured Parties, and all
obligations (other than those expressly stated to survive such termination)
of each Grantor to the First Lien Administrative Agent or any other First
Lien Secured Party hereunder shall terminate, all without delivery of any
instrument or performance of any act by any party. At the sole expense of
any Grantor following any such termination, the First Lien Administrative
Agent shall deliver (x) prior to the Discharge of Second Lien Obligations,
to the Second Lien Administrative Agent and (y) thereafter, to any Grantor
requesting delivery, any First Lien Collateral constituting Certificated
Securities or other First Lien Collateral in the possession of the First
Lien Administrative Agent hereunder and such documents as the Second Lien
Administrative Agent or such Grantor shall reasonably request to evidence
such termination.
(ii) Upon the Discharge of Second Lien Obligations, the Second Lien
Collateral shall be released from the Liens in favor of the Second Lien
Administrative Agent and the other Second Lien Secured Parties created
hereby, this Agreement shall terminate with respect to the Second Lien
Administrative Agent and the other Second Lien Secured Parties, and all
obligations (other than those expressly stated to survive such termination)
of each Grantor to the Second Lien Administrative Agent or any other Second
Lien Secured Party hereunder shall terminate, all without delivery of any
instrument or performance of any act by any party, and all rights to the
Second Lien Collateral shall revert to the Grantors. At the sole expense of
any Grantor following any such termination, the Second Lien Administrative
Agent shall deliver to any Grantor requesting delivery, any Second Lien
Collateral constituting Certificated Securities or other Second Lien
Collateral in the possession of the Second Lien Administrative Agent
hereunder and such documents as such Grantor shall reasonably request to
evidence such termination.
(b) If any of the Collateral shall be sold, transferred or otherwise
disposed of by any Grantor in a transaction permitted by Section 8 and Section 9
of the Credit Agreement, then each of the First Lien Administrative Agent and
the Second Lien Administrative Agent, as applicable, at the request and sole
expense of such Grantor, shall execute and deliver to such Grantor all releases
or other documents reasonably necessary or desirable for the release of the
Liens created hereby on such Collateral, as applicable. At the request and sole
expense of the Borrower, a Subsidiary Guarantor shall be released from its
37
obligations hereunder in the event that all the Capital Stock of such Subsidiary
Guarantor shall be sold, transferred or otherwise disposed of to a Person other
than a Loan Party in a transaction permitted by Section 8 and Section 9 the
Credit Agreement; provided that the Borrower shall have delivered to each of the
First Lien Administrative Agent and the Second Lien Administrative Agent, as
applicable, at least ten days, or such shorter period as the First Lien
Administrative Agent and the Second Lien Administrative Agent may agree, prior
to the date of the proposed release, a written request for release identifying
the relevant Subsidiary Guarantor and the terms of the sale or other disposition
in reasonable detail, including the price thereof and any expenses in connection
therewith, together with a certification by the Borrower stating that such
transaction is in compliance with Section 8 and Section 9 of the Credit
Agreement and the other Loan Documents.
11.16 WAIVER OF JURY TRIAL. EACH GRANTOR AND EACH AGENT HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
11.17 No Novation. Each of the First Lien Administrative Agent, the
Second Lien Administrative Agent, the First Lien Secured Parties, the Second
Lien Secured Parties and each Grantor acknowledges and agrees that: (a) this
Agreement supercedes the Existing Security Agreement and has been executed and
delivered in renewal, amendment, restatement and modification, but not in
novation or extinguishment of, the obligations under the Existing Security
Agreement; and (b) all obligations under the Existing Security Agreement are
continued and restated hereunder, as set forth herein and in the other Loan
Documents.
38
IN WITNESS WHEREOF, each of the undersigned has caused this SECOND
AMENDED AND RESTATED SECURITY AGREEMENT to be duly executed and delivered as of
the date first above written.
GRANTORS:
WILTEL COMMUNICATIONS, LLC
By: /s/ Mardi Ford xx Xxxxxx
------------------------------------------
Name: Mardi Ford xx Xxxxxx
Title: Vice President and Treasurer
WILTEL COMMUNICATIONS GROUP, INC.
By: /s/ Mardi Ford xx Xxxxxx
------------------------------------------
Name: Mardi Ford xx Xxxxxx
Title: Vice President and Treasurer
CG AUSTRIA, INC.
By: /s/ Mardi Ford xx Xxxxxx
------------------------------------------
Name: Mardi Ford xx Xxxxxx
Title: Vice President and Treasurer
CRITICAL CONNECTIONS, INC.
VYVX, LLC
WCS COMMUNICATIONS SYSTEMS, INC.
WILTEL COMMUNICATIONS MANAGED SERVICES OF
CALIFORNIA, INC.
WILTEL COMMUNICATIONS OF VIRGINIA, INC.
WILTEL COMMUNICATIONS PROCUREMENT, L.L.C.
WILTEL LOCAL NETWORK, LLC
By: /s/ Mardi Ford xx Xxxxxx
------------------------------------------
Name: Mardi Ford xx Xxxxxx
Title: Vice President and Treasurer
[Signature Page to Second Amended and Restated Security Agreement]
WILTEL COMMUNICATIONS PROCUREMENT, LP
By: WilTel Communications, LLC, as General Partner
By: /s/ Mardi Ford xx Xxxxxx
-----------------------------------------------
Name: Mardi Ford xx Xxxxxx
Title: Vice President and Treasurer
WILTEL TECHNOLOGY CENTER, LLC
By: WilTel Communications, LLC, as Sole Member
By: /s/ Mardi Ford xx Xxxxxx
-----------------------------------------------
Name: Mardi Ford xx Xxxxxx
Title: Vice President and Treasurer
FTV COMMUNICATIONS LLC
By: WilTel Communications, LLC, as Sole Member
By: /s/ Mardi Ford xx Xxxxxx
-----------------------------------------------
Name: Mardi Ford xx Xxxxxx
Title: Vice President and Treasurer
[Signature Page to Second Amended and Restated Security Agreement]
CREDIT SUISSE FIRST BOSTON,
acting through its Cayman Islands branch,
as Administrative Agent
By: /s/ Xxxxxx Xxxx
----------------------------------------
Name: Xxxxxx Xxxx
Title: Director
By: /s/ Xxxxxxx Xxxxx
----------------------------------------
Name: Xxxxxxx Xxxxx
Title: Associate
CREDIT SUISSE FIRST BOSTON,
acting through its Cayman Islands branch,
as First Lien Administrative
By: /s/ Xxxxxx Xxxx
----------------------------------------
Name: Xxxxxx Xxxx
Title: Director
By: /s/ Xxxxxxx Xxxxx
----------------------------------------
Name: Xxxxxxx Xxxxx
Title: Associate
CREDIT SUISSE FIRST BOSTON,
acting through its Cayman Islands branch,
as Second Lien Administrative Agent
By: /s/ Xxxxxx Xxxx
----------------------------------------
Name: Xxxxxx Xxxx
Title: Director
By: /s/ Xxxxxxx Xxxxx
----------------------------------------
Name: Xxxxxxx Xxxxx
Title: Associate
[Signature Page to Second Amended and Restated Security Agreement]
AGREED AND ACKNOWLEDGED:
XXXXXXXX COMMUNICATIONS GROUP, INC.
By: /s/ Mardi Ford xx Xxxxxx
-----------------------------------------
Name: Mardi Ford xx Xxxxxx
Title: Sole Director and President
WILTEL AIRCRAFT LEASING, LLC
By: WilTel Communications, LLC, as Sole Member
By: /s/ Mardi Ford xx Xxxxxx
-----------------------------------------
Name: Mardi Ford xx Xxxxxx
Title: Vice President and Treasurer
[Signature Page to Second Amended and Restated Security Agreement]
Schedule 1
----------
NOTICE ADDRESSES OF GUARANTORS
Schedule 2
----------
DESCRIPTION OF INVESTMENT PROPERTY
PLEDGED STOCK:
Issuer Class of Stock Stock Certificate No. No. of Shares
------------------------------- --------------------- ---------------------------- -------------------------------
PLEDGED NOTES:
Issuer Date of Issuance Payee Principal Amount
------------------------------- --------------------- ---------------------------- -------------------------------
SECURITIES ACCOUNTS:
Securities Intermediary Address Account Number(s)
------------------------------- --------------------- -------------------------------
COMMODITIES ACCOUNTS:
Commodities Intermediary Address Account Number(s)
----------------------------------------------------- ----------------------------- -------------------------------
DEPOSIT ACCOUNTS:
Depositary Bank Address Account Number(s)
----------------------------------------------------- ----------------------------- -------------------------------
Schedule 3
----------
FILINGS AND OTHER ACTIONS
REQUIRED TO PERFECT SECURITY INTERESTS
Uniform Commercial Code Filings
-------------------------------
[List each office where a financing statement is to be filed]
Copyright, Patent and Trademark Filings
---------------------------------------
[List all filings]
Actions with respect to Pledged Stock
Other Actions
-------------
[Describe other actions to be taken]
Schedule 4
----------
LOCATION OF JURISDICTION OF ORGANIZATION AND CHIEF EXECUTIVE OFFICE
Grantor Jurisdiction of Organizational Location of Chief
------- --------------- -------------- -----------------
Organization Identification Executive Office
------------ -------------- ----------------
Number
------
Schedule 5
----------
LOCATIONS OF EQUIPMENT AND MATERIAL INVENTORY
Grantor Locations
------- ---------
Schedule 6
----------
COPYRIGHTS AND COPYRIGHT LICENSES
PATENTS AND PATENT LICENSES
TRADEMARKS AND TRADEMARK LICENSES
Schedule 7
----------
EXCLUDED DEPOSIT ACCOUNTS
ACKNOWLEDGEMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the Second
Amended and Restated Security Agreement, dated as of September 24, 2004 (the
"Agreement"), made by the Grantors parties thereto for the benefit of CREDIT
SUISSE FIRST BOSTON, ACTING THROUGH ITS CAYMAN ISLANDS BRANCH, as Administrative
Agent, as First Lien Administrative Agent and as Second Lien Administrative
Agent. The undersigned agrees for the benefit of each of the Administrative
Agent, the First Lien Administrative Agent and the Second Lien Administrative
Agent and each of the Secured Parties as follows:
1. The undersigned will be bound by the terms of the Agreement and
will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify each of the First Lien Administrative
Agent and the Second Lien Administrative Agent promptly in writing of the
occurrence of any of the events described in Section 5.7(a) or 6.7(a) of the
Agreement.
3. The terms of Sections 7.3(c) and 7.7, or 8.3(c) and 8.7, as
applicable, of the Agreement shall apply to it, mutatis mutandis, with respect
to all actions that may be required of it pursuant to Section 7.3(c) and 7.7, or
8.3(c) and 8.7, as applicable, of the Agreement.
[NAME OF ISSUER]
By:_______________________________________
Name:
Title:
Address for Notices:
_________________________________________
_________________________________________
_________________________________________
Fax:
Annex 1 to
Second Amended and Restated Security Agreement
----------------------------------------------
ASSUMPTION AGREEMENT, dated as of ________________, ____, made by
______________________________ (the "Additional Grantor"), in favor of CREDIT
SUISSE FIRST BOSTON, acting through its Cayman Islands branch, as Administrative
Agent, as First Lien Administrative Agent and as Second Lien Administrative
Agent (collectively in such capacities, the "Agent") for the banks and other
financial institutions or entities (the "Lenders") from time to time parties to
the Third Amended and Restated Credit Agreement, dated as of September 8, 1999,
as amended and restated as of April 25, 2001, as further amended and restated as
of October 15, 2002, and as further amended and restated as of September 24,
2004 (as further amended, amended and restated, supplemented, restructured or
otherwise modified, renewed or replaced from time to time, the "Credit
Agreement"), among WILTEL COMMUNICATIONS, LLC, a Delaware limited liability
company (the "Borrower"), the other Grantors party thereto, the Lenders and the
Agent. All capitalized terms not defined herein shall have the meaning ascribed
to them in such Credit Agreement.
W I T N E S S E T H :
WHEREAS, in connection with the Credit Agreement, the Borrower and
certain of its Affiliates (other than the Additional Grantor) have entered into
the Second Amended and Restated Security Agreement, dated as of April 23, 2001,
as amended and restated as of October 15, 2002, and as further amended and
restated as of September 24, 2004, in favor of the Administrative Agent, the
First Lien Administrative Agent and the Second Lien Administrative Agent for the
benefit of the Lenders (the "Security Agreement");
WHEREAS, the Credit Agreement requires the Additional Grantor to
become a party to the Security Agreement; and
WHEREAS, the Additional Grantor has agreed to execute and deliver
this Assumption Agreement in order to become a party to the Security Agreement;
NOW, THEREFORE, IT IS AGREED:
1. Security Agreement. By executing and delivering this Assumption
Agreement, the Additional Grantor, as provided in Section 11.14 of the Security
Agreement, (a) hereby becomes a party to the Security Agreement as a Grantor
thereunder with the same force and effect as if originally named therein as a
Grantor and, without limiting the generality of the foregoing, hereby expressly
assumes all obligations and liabilities of a Grantor thereunder, (b) hereby
grants to the First Lien Administrative Agent, as security for the First Lien
Obligations of such Additional Grantor, a security interest in all of the
Additional Grantor's right, title and interest in any and to all Collateral of
Additional Grantor, in each case whether now owned or hereafter acquired or in
which Additional Grantor now has or hereafter acquires an interest and wherever
the same may be located, but subject in all respects to the terms, conditions
and exclusions set forth in the Security Agreement, and (c) hereby grants to the
Second Lien Administrative Agent, as security for the Second Lien Obligations of
such Additional Grantor, a security interest in all of the Additional Grantor's
right, title and interest in any and to all Collateral of Additional Grantor, in
each case whether now owned or hereafter acquired or in which Additional Grantor
now has or hereafter acquires an interest and wherever the same may be located,
but subject in all respects to the terms, conditions and exclusions set forth in
the Security Agreement. The information set forth in Annex 1-A hereto is hereby
added to the information set forth in the Schedules to the Security Agreement.
The Additional Grantor hereby represents and warrants that each of the
representations and warranties contained in Section 4 of the Security Agreement
is true and correct on and as the date hereof (after giving effect to this
Assumption Agreement) as if made on and as of such date.
2. GOVERNING LAW. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Assumption
Agreement to be duly executed and delivered as of the date first above written.
[ADDITIONAL GRANTOR]
By:___________________________________
Name:
Title:
Annex 1-A to
Assumption Agreement
--------------------
Supplement to Schedule 1
------------------------
Supplement to Schedule 2
------------------------
Supplement to Schedule 3
------------------------
Supplement to Schedule 4
------------------------
Supplement to Schedule 5
------------------------
Supplement to Schedule 6
------------------------
