EXHIBIT 10.5
COLLATERAL TRADEMARK SECURITY AGREEMENT
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THIS COLLATERAL TRADEMARK SECURITY AGREEMENT ("Security Agreement") made as
of the 15/th/ day of October, 1999 by XXXXX & XXXXX COMPANY, a Delaware
corporation, having its principal office at 0000 Xxxxxxx Xxxx, Xxxxx 000,
Xxxxxxxxxx, Xxxxxxxx 00000 ("Borrower") in favor of BANK OF AMERICA, N.A., a
national banking association, as administrative agent (in such capacity
"Administrative Agent"), having an office at 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx 00000 for itself and the benefit of the banks and other financial
institutions or entities (the "Lenders") from time to time parties to the Credit
Agreement of even date herewith (as amended, restated, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among Borrower,
Administrative Agent and the Lenders.
W I T N E S S E T H:
WHEREAS, Lenders and Borrower have entered into the Credit Agreement
providing for Lenders to make certain Loans and extend other financial
accommodations to Borrower (Capitalized terms used but not otherwise defined
herein shall have the meaning given such terms in the Credit Agreement.); and
WHEREAS, it is a condition precedent to the making of the Loans under the
Credit Agreement by Lenders that Borrower shall have granted the security
interest and made the collateral assignment contemplated by this Security
Agreement;
NOW, THEREFORE, in consideration of the premises and in order to induce
Lenders to make Loans under the Credit Agreement, Borrower hereby agrees with
Administrative Agent and its successors, transferees and assigns as follows:
1. Grant of Security Interest. To secure the prompt and complete payment,
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observance and performance of all of the Borrower Obligations, Borrower hereby
grants, bargains, assigns, mortgages, pledges, sells and creates a security
interest in and transfers and conveys the same to Administrative Agent, and its
successors, transferees and assigns, for itself and the benefit of the Lenders,
as and by way of a first mortgage and security interest having priority over all
other security interests, with power of sale as hereinafter provided, to the
extent permitted by law, with respect to all of the following property of
Borrower, whether now owned or existing or hereafter acquired or arising
(collectively, the "Collateral"):
(a) all of Borrower's rights, title and interests in its
trademarks and trademark registrations and all rights and interests
under trademark license agreements, trade names and trademark
applications for which registrations have been issued or applied for
in the United States Patent and Trademark Office, or used in the
United States or any state, territory or possession thereof,
including, without limitation, the trademarks, trademark registrations
and applications listed
on Annex A attached hereto and made a part hereof and the trademark
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license agreements (both as licensee and licensor), other than those
trademark license agreements with independently owned and operated
companies with whom Grantor or its Subsidiaries has entered into
commercial real estate brokerage affiliation agreements, listed on
Annex B attached hereto and made a part hereof and (i) all renewals
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thereof, (ii) all income, royalties, damages and payments now or
hereafter due and/or payable under and with respect thereto,
including, without limitation, payments under all licenses entered
into in connection therewith and damages and payments for past or
future infringements thereof but excluding attorneys' fees and court
costs payable to Borrower in respect thereto, (iii) the right to xxx
for past, present and future infringements thereof, and (iv) all
rights corresponding thereto throughout the world (all of the
foregoing trademark, trademark registrations, and interests under
trademark license agreements, trade names and applications, together
with the items described in clauses (i) through (iv) in this
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subparagraph (a), are sometimes hereinafter individually and/or
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collectively referred to as the "Trademarks"); and
(b) the goodwill of Borrower's business connected with the
Trademarks.
2. Collateral Assignment. Notwithstanding the terms and provisions of
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Section 1 above, this grant shall be for collateral purposes only. Unless an
Event of Default shall have occurred and be continuing, Borrower shall retain
the right to use the Collateral, for Borrower's own benefit and account. Upon
the occurrence and during the continuance of any Event of Default, Borrower's
rights to the Collateral as set forth in this paragraph shall terminate
automatically without any requirement of notice to Borrower of such termination,
and the Administrative Agent shall thereupon have, in addition to all other
rights and remedies given it by this Agreement, those allowed by the federal
laws of the United States and the rights and remedies of a secured party under
the Uniform Commercial Code as enacted in any jurisdiction in which any of the
Collateral may be located.
3. Restrictions on Future Agreements. Borrower agrees that during the
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existence and continuation of an Event of Default and until all Borrower
Obligations shall have been satisfied in full and the Credit Agreement shall
have been terminated, Borrower will not, without Administrative Agent's prior
written consent, abandon any Trademark or enter into any agreement, except with
Borrower's Affiliates, including, without limitation, any license agreement,
which is inconsistent with Borrower's obligations under this Security Agreement
if such actions would materially adversely affect the fair market value of the
Collateral or the benefits of this Security Agreement granted to Administrative
Agent including, without limitation, the priority or perfection of the security
interest granted herein or the remedies of Administrative Agent hereunder, and
Borrower further agrees that during the existence and continuation of an Event
of Default it will not take any action, or permit any action to be taken by
others subject to its control, including licensees, or fail to take any action,
which would affect the validity or enforcement of the rights transferred or
granted to Administrative Agent under this Security Agreement and any such
agreement or action if it shall take place shall be null and void and of no
effect whatsoever.
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4. New Trademarks. Borrower represents and warrants that the Trademarks
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listed on Annex A and the license agreements listed on Annex B constitute all of
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the Trademarks and applications now owned by or licensed to or by Borrower for
which registrations have been issued or applied for in the United States Patent
and Trademark Office. If, before the Borrower Obligations have been satisfied
in full and the Credit Agreement terminated, Borrower shall (i) obtain rights to
any new trademarks, trademark registrations or applications or trade names used
in the United States or any state, territory or possession thereof, or (ii)
become entitled to the benefit of any trademark application, trademark,
trademark registration or trade name used in the United States or any state,
territory or possession thereof, the provisions of Section 1 above shall
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automatically apply thereto and Borrower shall give to Administrative Agent
prompt written notice thereof. Borrower hereby authorizes Administrative Agent
to modify this Security Agreement by amending Annex A and Annex B to include any
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future trademarks, trademark registrations, trademark applications, trade names
and license agreements which are Trademarks, as applicable, under Section 1
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above or under this Section 4.
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5. Additional Representations and Warranties. Borrower hereby represents,
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warrants, covenants and agrees that:
(a) Except as otherwise provided herein or in the Credit Agreement,
including, without limitation, dispositions of Collateral in connection
with dispositions of assets permitted under the Credit Agreement, it is and
will continue to be the owner of all right, title and interest in the
Collateral so long as the Trademarks shall continue in force, free from any
lien or security interest in favor of any Person except for the security
interest granted to Administrative Agent.
(b) It has the full right and power to grant the security interest in
the Collateral made hereby.
(c) Except to its Affiliates, it has made no previous assignment,
transfer or agreements in conflict herewith or constituting a present or
future assignment, transfer, or encumbrance on any of the Collateral except
for license agreements to use such Trademarks granted to licensees
described on Annex B hereto.
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(d) (i) There is no financing statement or other document or
instrument now signed or on file in any public office covering any part of
the Collateral, except those showing Administrative Agent as secured party,
and so long as any Borrower Obligations remain outstanding under the Credit
Agreement or the Credit Agreement has not terminated, and (ii) it will not
execute, and it shall not permit there to be on file in any public office,
any such financing statement or other document or instruments, except
financing statements on file or to be filed in favor of Administrative
Agent.
(e) Subject to any limitations stated therein or in connection
therewith, all information furnished to Administrative Agent or the other
Lenders concerning the Collateral and proceeds thereof, for the purpose of
obtaining credit or an extension of
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credit, is, or will be at the time the same is furnished, accurate and
correct in all material respects.
(f) To the best of Borrower's knowledge and belief after due inquiry,
no material infringement or unauthorized use presently is being made of any
of the Trademarks which would materially adversely affect the fair market
value of the Collateral or the benefits of this Security Agreement granted
to Administrative Agent including, without limitation, the priority or
perfection of the security interest granted herein or the remedies of
Administrative Agent hereunder.
6. Royalties; Terms. Borrower hereby agrees that any rights to use
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granted hereunder by Administrative Agent and its successors, transferees and
assigns with respect to all Collateral as described above shall be worldwide (to
the extent Borrower has such rights) and without any liability for royalties or
other related charges from Administrative Agent or Lenders, ratably, to
Borrower. The term of the assignments of security interests granted herein
shall extend until the earlier of (i) the expiration or termination of each of
the Trademarks assigned hereunder or (ii) all Borrower Obligations have been
paid in full and the Credit Agreement has been terminated.
7. Administrative Agent's Right to Inspect. Administrative Agent shall
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have the right, upon reasonable notice and from time to time, to inspect
Borrower's premises and to examine Borrower's books, records and operations.
During the existence and continuation of an Event of Default, Borrower agrees
not to sell or assign its interest in, or grant any license under, any of the
Collateral without the prior written consent of Administrative Agent. Unless
Administrative Agent reasonably determines that to do so would be adverse to its
interests, Administrative Agent will give Borrower reasonable advance notice and
make any inspections during Borrower's normal business hours.
8. Release of Security Interest.
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(a) This Security Agreement is made for collateral purposes only.
Upon payment in full of all Borrower Obligations and termination of the
Credit Agreement, Administrative Agent shall, at Borrower's sole cost and
expense, execute and deliver to Borrower all termination statements,
assignments and other instruments as may be necessary or proper to re-vest
in Borrower full title to the Collateral granted hereby, subject to any
disposition thereof which may have been made by Administrative Agent
pursuant hereto or pursuant to the Credit Agreement.
(b) Upon any sale, assignment, lease or other disposition of all or
any part of the Collateral permitted by the Credit Agreement or in
connection with the sale, assignment, lease or other disposition of assets
permitted by the Credit Agreement, with application of the proceeds thereof
made in accordance with the Credit Agreement, Administrative Agent
acknowledges and agrees that the security interest in the Collateral
granted hereby shall be released and that it shall execute and deliver to
Borrower all termination statements, assignments and other documents and
instruments as may be
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necessary or desirable to fully release the security interest in such
Collateral granted hereby.
9. Duties of Borrower. During the existence and continuation of an Event
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of Default Borrower agrees: (a) Borrower shall have the duty (i) to prosecute
diligently any trademark application that is part of the Trademarks pending as
of the date hereof or thereafter until all Borrower Obligations shall have been
paid in full and the Credit Agreement shall have been terminated, (ii) to make
application on Trademarks as appropriate and (iii) to preserve and maintain all
rights in trademark applications, trademarks, trade names, interests under
trademark license agreements and trademark registrations that are part of the
Trademarks, the fair market value of the Collateral, in each case to the extent
such items are still used or useful in the business of Borrower, or the benefits
of this Security Agreement granted to Administrative Agent including, without
limitation, the priority or perfection of the security interest granted herein
or the remedies of Administrative Agent hereunder; (b) any expenses incurred in
connection with such applications shall be borne by Borrower; (c) Borrower
agrees to retain an experienced trademark attorney approved by Administrative
Agent for the filing and prosecution of all such applications and other
proceedings at the time of such filing of prosecution; and (d) Borrower shall
not abandon any right to file a trademark application or any pending trademark
application without the consent of Administrative Agent.
If Borrower fails to comply with any of the foregoing duties,
Administrative Agent may do so in Borrower's name to the extent permitted by
law, but at Borrower's expense, and Borrower hereby agrees to reimburse
Administrative Agent in full for all expenses, including the reasonable fees and
disbursements of counsel incurred by Administrative Agent in protecting,
defending and maintaining the Collateral, which counsel may be the employee of
the Administrative Agent.
In the event that Borrower shall fail to pay when due any fees required to
be paid by it hereunder, or shall fail to discharge any lien or security
interest prohibited hereby, or shall fail to comply with any other duty
hereunder, Administrative Agent may, but shall not be required to, pay, satisfy,
discharge or bond the same for the account of Borrower, and all moneys so paid
out shall be Borrower Obligations repayable on demand, together with interest at
the rate of interest applicable to Loans under the Credit Agreement.
Borrower further agrees that for so long as no Event of Default exists
Borrower will at all times maintain, preserve and protect the Collateral to the
extent consistent with prudent and reasonable business practices.
10. Remedies; Right to Xxx. Upon the occurrence and during the
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continuance of an Event of Default, Administrative Agent's remedies shall be as
set forth in Section 6.6 of that certain Guaranty and Collateral Agreement of
even date herewith by and among, inter alia, Borrower and Administrative Agent.
In addition to the foregoing, upon the occurrence and during the continuance of
an Event of Default, Administrative Agent and its successors, transferees and
assigns and shall have the right, but shall in no way be obligated, to bring
suit in their own name to enforce the Trademarks, and any licenses thereunder,
and, if Administrative Agent or any such
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other party shall commence any such suit, Borrower shall, at the request of
Administrative Agent or such other party, do any and all lawful acts and execute
any and all proper documents required by Administrative Agent or such other
party in aid of such enforcement and Borrower shall promptly, upon demand,
reimburse and indemnify Administrative Agent or such other party for all costs
and expenses incurred by Administrative Agent or such other party in the
exercise of their rights under this Section 10.
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11. Waivers. No course of dealing between Borrower and Administrative
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Agent or any of their respective successors, transferees and assigns, nor any
failure to exercise, nor any delay in exercising, on the part of Administrative
Agent or any such other party, any right, power or privilege hereunder or under
the Credit Agreement shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder or thereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege.
12. Severability. The provisions of this Security Agreement are
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severable, and if any clause or provision shall be held invalid and
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof, in
such jurisdiction, and shall not in any manner affect such clause or provision
in any other jurisdiction, or any other clause or provision of this Security
Agreement in any jurisdiction.
13. Modification. This Security Agreement cannot be altered, amended or
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modified in any way, except as specifically provided in Section 4 hereof or by a
writing signed by the parties hereto.
14. Cumulative Remedies; Power of Attorney; Effect on Credit Agreement.
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All of the rights and remedies of Administrative Agent, the other Lenders and
their successors, transferees and assigns with respect to the Collateral,
whether established hereby or by the Credit Agreement, or by any other
agreements or by law shall be cumulative and may be exercised singularly or
concurrently. Borrower hereby authorizes Administrative Agent to make,
constitute and appoint any officer or agent of Administrative Agent as
Administrative Agent may select, in its sole discretion, as Borrower's true and
lawful attorney-in-fact, with power (i) at any time after the occurrence of an
Event of Default, to endorse Borrower's name on all applications, documents,
papers and instruments necessary or desirable for Administrative Agent in the
use of the Collateral, or to grant or issue any exclusive or non-exclusive
license under the Collateral to anyone, or to assign, pledge, convey or
otherwise transfer title in or dispose of the Collateral to anyone free and
clear of any encumbrance upon title thereof created after the date of this
Security Agreement, and (ii) at any time and from time to time to take any other
actions with respect to the Collateral as Administrative Agent reasonably deems
in its best interests. Administrative Agent hereby ratifies all that such
attorney-in-fact shall lawfully do or cause to be done by virtue hereof. This
power of attorney, being coupled with an interest, shall be irrevocable until
all Borrower Obligations shall have been paid in full and the Credit Agreement
has been terminated. Borrower acknowledges and agrees that this Security
Agreement is not intended to limit or restrict in any way the rights and
remedies of Administrative Agent, the other Lenders or their successors,
transferees and assigns under the Credit Agreement but rather is intended to
facilitate the exercise of such rights and remedies. Administrative Agent and
such other parties shall have, in addition
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to all other rights and remedies given it or them by the terms of this Security
Agreement, all rights and remedies allowed by law and the rights and remedies of
a secured party under the Uniform Commercial Code as enacted in any jurisdiction
in which the Trademarks may be located. Recourse to security will not be
required at any time.
15. Care of Collateral. Administrative Agent shall be deemed to have
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exercised reasonable care in the custody and preservation of the Collateral if
it takes such action for that purpose as Borrower shall request in writing, but
failure of Administrative Agent to comply with any such request shall not of
itself be deemed a failure to exercise reasonable care, and no failure of
Administrative Agent to preserve or protect any rights with respect to the
Collateral against prior parties, or to do any act with respect to preservation
of the Collateral not so requested by Borrower shall be deemed a failure to
exercise reasonable care in the custody or preservation of the Collateral unless
such failure is the result of gross negligence or willful misconduct.
16. Certain Rights Regarding Collateral and Borrower Obligations.
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Administrative Agent may, upon the occurrence and during the continuance of an
Event of Default, without notice to Borrower, take all or any of the following
actions: (a) transfer all or any part of the Collateral into the name of
Administrative Agent or its nominee, with or without disclosing that such
Collateral is subject to the lien and security interest hereunder, (b) notify
the parties obligated on any of the Collateral to make payment to Administrative
Agent of any amounts due or to become due hereunder, (c) enforce collection of
any of the Collateral by suit or otherwise, and surrender, release or exchange
all or any part thereof, or compromise or extend or renew for any period
(whether or not longer than the original period) any obligations of any nature
of any party with respect thereto and (d) take control of any proceeds of the
Collateral. Administrative Agent may, furthermore, from time to time, whether
before or after any of the Borrower Obligations shall become due and payable,
without notice to Borrower, take all or any of the following actions: (a) retain
or obtain a security interest in any property, in addition to the Collateral, to
secure any of the Borrower Obligations, (b) retain or obtain the primary or
secondary liability of any party or parties, in addition to Borrower with
respect to any of the Borrower Obligations, (c) extend or renew for any period
(whether or not longer than the original period) or exchange any of the Borrower
Obligations or release or compromise any obligation of any nature of any party
with respect thereto, (d) surrender, release or exchange all or any part of any
property, in addition to the Collateral, securing any of the Borrower
Obligations, or compromise or extend or renew for any period (whether or not
longer than the original period) any obligations of any nature of any party with
respect to any such property, and (e) resort to the Collateral for payment of
any of the Borrower Obligations whether or not it shall have resorted to any
other property securing the Borrower Obligations or shall have proceeded against
any party primarily or secondarily liable on any of the Borrower Obligations.
17. Binding Effect; Benefits. This Security Agreement shall be binding
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upon Borrower and its respective successors and assigns, and shall inure to the
benefit of Administrative Agent and its respective successors, transferees and
assigns.
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18. Governing Law. This Security Agreement shall be governed by and
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construed in accordance with the laws of the State of Illinois as further
provided in Section 11.11 of the Credit Agreement.
19. Notice. Whenever it is provided herein that any notice, demand,
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request, consent, approval, declaration or other communication shall or may be
given to or served upon either of the parties by the other, or whenever either
of the parties desires to give or serve upon the other any communication with
respect to this Security Agreement, each such notice, demand, request, consent,
approval, declaration or other communication shall be in writing and shall be
delivered in accordance with the provisions of the Credit Agreement.
20. Consent to Jurisdiction; Waiver of Jury Trial. To induce
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Administrative Agent to accept this Security Agreement, Borrower irrevocably
agrees that this Security Agreement incorporates herein Section 11.12 of the
Credit Agreement, with respect to submission to jurisdiction and Section 11.14
of the Credit Agreement, with respect to waiver of jury trial.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Security Agreement as of the day first above written.
XXXXX & XXXXX COMPANY, a Delaware
corporation
By: /s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
Title: Chief Financial Officer & Executive
Vice President
Address: 0000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: General Counsel
BANK OF AMERICA, N.A., a national banking
association, as Administrative Agent
By: /s/ Xxxxx Xxxxxxx
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Name: Xxxxx Xxxxxxx
Title: Vice President
Address: 000 Xxxxx Xxxxx Xx.,
XX-0-000-00-00
Xxxxxxxxx, XX 00000
Attention: W. Xxxxxx Xxxxxxx
STATE OF Illinois )
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) ss.:
COUNTY OF Xxxx )
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The foregoing Collateral Trademark Security Agreement was executed and
acknowledged before me this 15/th/ day of October, 1999, by Xxxxx Xxxxxx
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personally known to me to be the Executive VP/CFO of Xxxxx & Xxxxx
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Company, a Delaware corporation, on behalf of such corporation.
(SEAL)
/s/ Xxxxxxx X. Xxxxx
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Notary Public
Xxxx County, Illinois
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My Commission expires:
9/28/02
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STATE OF ___________ )
) ss.:
COUNTY OF _________ )
The foregoing Collateral Trademark Security Agreement was executed and
acknowledged before me this 15/th/ day of October, 1999, by Xxxxx Xxxxxxx
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personally known to me to be the Vice President Bank of America, N.A., a
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national banking association, as Administrative Agent, on behalf of such Bank.
(SEAL)
Xxxxxxx X. Xxxxx
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Notary Public
Xxxx County, Illinois
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My Commission expires:
9/28/02
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