SECURITY AGREEMENT among RCN CORPORATION, CERTAIN SUBSIDIARIES OF RCN CORPORATION and DEUTSCHE BANK TRUST COMPANY AMERICAS, as FIRST-LIEN COLLATERAL AGENT
among
RCN
CORPORATION,
CERTAIN
SUBSIDIARIES OF RCN CORPORATION
and
DEUTSCHE
BANK TRUST COMPANY AMERICAS,
as
FIRST-LIEN COLLATERAL AGENT
Dated
as
of May 30, 2006
SECURITY
AGREEMENT, dated as of May 30, 2006, made by each of the undersigned assignors
(each, an “Assignor”
and,
together with any other entity that becomes an assignor hereunder pursuant
to
Section 10.12 hereof, the “Assignors”)
in
favor of Deutsche Bank Trust Company Americas, as collateral agent (together
with any successor collateral agent, the “First-Lien
Collateral Agent”),
for
the benefit of the Secured Creditors (as defined below). Certain capitalized
terms as used herein are defined in Article IX hereof. Except as otherwise
defined herein, all capitalized terms used herein and defined in the Credit
Agreement (as defined below) shall be used herein as therein
defined.
W
I T N E S
S E T H:
WHEREAS,
RCN Corporation (the “Borrower”),
the
lenders from time to time party thereto (the “Lenders”)
and
Deutsche Bank Trust Company Americas, as administrative agent (together with
any
successor Administrative Agent, the “Administrative
Agent”),
have
entered into a First-Lien Credit Agreement, dated as of May 30, 2006 (as
amended, modified, restated and/or supplemented from time to time, the
“Credit
Agreement”),
providing for the making of Loans to, and the issuance of, and participation
in,
Letters of Credit for the account of the Borrower, all as contemplated therein
(the Lenders, each Issuing Lender, the Administrative Agent, the First-Lien
Collateral Agent and each other Agent are herein called the “Lender
Creditors”);
WHEREAS,
the Borrower and/or one or more of its Subsidiaries may at any time and from
time to time enter into one or more Interest Rate Protection Agreements or
Other
Hedging Agreements with one or more Lenders or any affiliate thereof (each
such
Lender or affiliate, even if the respective Lender subsequently ceases to be
a
Lender under the Credit Agreement for any reason, together with such Lender’s or
affiliate’s successors and assigns, if any, collectively, the “Other
Creditors”
and,
together with the Lender Creditors, the “Secured
Creditors”);
WHEREAS,
pursuant to the Subsidiaries Guaranty, each Subsidiary Guarantor has jointly
and
severally guaranteed to the Secured Creditors the payment when due of all
Guaranteed Obligations as described therein;
WHEREAS,
it is a condition precedent to the making of Loans to the Borrower and the
issuance of, and participation in, Letters of Credit for the account of the
Borrower under the Credit Agreement and to the Other Creditors entering into
Interest Rate Protection Agreements and Other Hedging Agreements that each
Assignor shall have executed and delivered to the First-Lien Collateral Agent
this Agreement; and
WHEREAS,
each Assignor will obtain benefits from the incurrence of Loans by the Borrower
and the issuance of, and participation in, Letters of Credit for the account
of
the Borrower under the Credit Agreement and the entering into by the Borrower
and/or one or more of its Subsidiaries of Interest Rate Protection Agreements
or
Other Hedging Agreements and, accordingly, desires to execute this Agreement
in
order to satisfy the condition described in the preceding paragraph and to
induce the Lenders to make Loans to the Borrower and issue, and/or participate
in, Letters of Credit for the account of the Borrower and the Other Creditors
to
enter into Interest Rate Protection Agreements or Other Hedging Agreements
with
the Borrower and/or one or more of its Subsidiaries;
NOW,
THEREFORE, in consideration of the benefits accruing to each Assignor, the
receipt and sufficiency of which are hereby acknowledged, each Assignor hereby
makes the following representations and warranties to the First-Lien Collateral
Agent for the benefit of the Secured Creditors and hereby covenants and agrees
with the First-Lien Collateral Agent for the benefit of the Secured Creditors
as
follows:
ARTICLE
I
SECURITY
INTERESTS
1.1
Grant
of Security Interests.
(a) As
security for the prompt and complete payment and performance when due of all
of
its Obligations, each Assignor does hereby assign and transfer unto the
First-Lien Collateral Agent, and does hereby pledge and grant to the First-Lien
Collateral Agent, for the benefit of the Secured Creditors, a continuing
security interest in all of the right, title and interest of such Assignor
in,
to and under all of the following personal property and fixtures (and all rights
therein) of such Assignor, or in which or to which such Assignor has any rights,
in each case whether now existing or hereafter from time to time acquired:
| (i) |
each
and every Account;
|
| (ii) |
all
cash and Cash Equivalents;
|
| (iii) |
the
Cash Collateral Account and all monies, securities, Instruments and
other
investments deposited in the Cash Collateral
Account;
|
| (iv) |
all
Chattel Paper (including, without limitation, all Tangible Chattel
Paper
and all Electronic Chattel Paper);
|
| (v) |
all
Commercial Tort Claims;
|
| (vi) |
all
computer programs of such Assignor and all intellectual property
rights
therein and all other proprietary information of such Assignor, including
but not limited to all Software, and all Software licensing rights,
all
writings, plans, specifications and schematics, all engineering drawings,
customer lists, goodwill and licenses, and all recorded data of any
kind
or nature, regardless of the medium of
recording;
|
| (vii) |
Contracts,
together with all Contract Rights arising
thereunder;
|
| (viii) |
all
Copyrights;
|
-2-
| (ix) |
all
Deposit Accounts and all other demand, deposit, time, savings, cash
management and passbook accounts maintained by such Assignor with
any
Person and all monies, securities, Instruments and other investments
deposited in any of the foregoing;
|
| (x) |
all
Documents;
|
| (xi) |
all
Domain Names;
|
| (xii) |
all
Equipment;
|
| (xiii) |
all
General Intangibles;
|
| (xiv) |
all
Goods;
|
| (xv) |
all
Instruments;
|
| (xvi) |
all
Inventory;
|
| (xvii) |
all
Investment Property;
|
| (xviii) |
all
Letter-of-Credit Rights (whether or not the respective letter of
credit is
evidenced by a writing);
|
| (xix) |
all
Marks;
|
| (xx) |
all
Patents;
|
| (xxi) |
all
Permits;
|
| (xxii) |
all
Supporting Obligations;
|
| (xxiii) |
all
Trade Secret Rights; and
|
| (xxiv) |
all
Proceeds and products of any and all of the foregoing and any item
excluded pursuant to the next succeeding sentence (except to the
extent
such proceeds would independently be excluded pursuant to said sentence)
(all of the above, the “Collateral”).
|
Notwithstanding
anything to the contrary contained above, in no event shall the Collateral
include, and no Assignor shall be deemed to have granted a security interest
(unless and until as further provided below) in (a) any lease, license,
contract, property rights or agreement to which any Assignor is a party or
any
of its rights or interests thereunder or property subject thereto if and for
so
long as the grant of such security interest shall constitute or result in (i)
the abandonment, invalidation or unenforceability of same or (ii) in a breach
or
termination pursuant to the terms of, or a default under, any such lease,
license, contract, property rights or agreement (other than to the extent that
any such term in the case of preceding clause (i) or (ii), as applicable) would
be rendered ineffective pursuant to Sections 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
the security interests hereunder shall attach (x) immediately to any portion
of
such lease, license, contract, property rights or agreement that does not result
in any of the consequences specified in (i) or (ii) and (y) to any property
or
assets described above in this clause (a) on the first date upon which the
circumstances described in preceding clauses (i) and/or (ii) (as relevant)
no
longer exist with respect thereto, or (b) more than 65% of the Voting Equity
Interests of any Foreign Corporation; provided
that
each Assignor shall be required to pledge hereunder 100% of any Non-Voting
Equity Interests at any time and from time to time acquired by such Assignor
of
any Foreign Corporation.
-3-
(b) The
security interest of the First-Lien Collateral Agent under this Agreement
extends to all Collateral which any Assignor may acquire, or with respect to
which any Assignor may obtain rights, at any time during the term of this
Agreement.
(c) Notwithstanding
anything herein to the contrary, the relative rights and remedies of First-Lien
Collateral Agent shall be subject to and governed by the terms of the
Intercreditor Agreement at any time the Intercreditor Agreement is in effect.
In
the event of any inconsistency between the terms hereof and the Intercreditor
Agreement, the Intercreditor Agreement shall control at any time the
Intercreditor Agreement is in effect.
1.2
Power
of Attorney.
Each
Assignor hereby constitutes and appoints the First-Lien Collateral Agent its
true and lawful attorney, irrevocably, with full power after the occurrence
of
and during the continuance of an Event of Default (in the name of such Assignor
or otherwise) to act, require, demand, receive, compound and give acquittance
for any and all moneys and claims for moneys due or to become due to such
Assignor under or arising out of the Collateral, to endorse any checks or other
instruments or orders in connection therewith and to file any claims or take
any
action or institute any pro-ceed-ings which the First-Lien Collateral Agent
may
deem to be neces-sary or advisable to protect the interests of the Secured
Creditors, which appointment as attorney is coupled with an
interest.
ARTICLE
II
GENERAL
REPRESENTATIONS, WARRANTIES AND COVENANTS
Each
Assignor represents, warrants and covenants, which representations, warranties
and covenants shall survive execution and delivery of this Agreement, as
follows:
2.1
Necessary
Filings.
All
filings, registrations, recordings and other actions necessary or appropriate
to
create, preserve and perfect the security interest granted by such Assignor
to
the First-Lien Collateral Agent hereby in respect of the Collateral have been
accomplished (or will be accomplished within ten days after the Initial
Borrowing Date or, with respect to Marks, Patents and Copyrights, within 30
days
of the date of the Initial Borrowing Date) and the security interest granted
to
the First-Lien Collateral Agent pursuant to this Agreement in and to the
Collateral creates a valid and, together with all such filings, registrations,
recordings and other actions, a perfected security interest therein subject
to
no Liens (other than Permitted Liens) and is entitled to all the rights,
priorities and benefits afforded by the Uniform Commercial Code or other
relevant law as enacted in any relevant jurisdic-tion to per-fected security
interests, in each case to the extent that the Collateral consists of the type
of prop-erty in which a security interest may be perfected by possession or
control (within the meaning of the UCC as in effect on the date hereof in the
State of New York), by filing a financing statement under the Uniform Commercial
Code as enacted in any relevant jurisdiction or by a filing of a Grant of
Security Interest in the respective form attached hereto in the United States
Patent and Trademark Office or in the United States Copyright Office. Each
Assignor hereby authorizes the First-Lien Collateral Agent to make duplicate
filings as if such Assignor is a Transmitting Utility, or alternatively, as
if
such Assignor is a Person which is not a Transmitting Utility.
-4-
2.2
No
Liens.
Such
Assignor is, and as to all Collateral acquired by it from time to time after
the
date hereof such Assignor will be, the owner of all Collateral free from any
Lien or other right, title or interest of any Person (other than Permitted
Liens), and such Assignor shall defend the Collateral against all claims and
demands of all Persons at any time claiming the same or any interest therein
adverse to the First-Lien Collateral Agent.
2.3
Other
Financing Statements.
As of
the date hereof, there is no financ-ing state-ment (or similar statement or
instrument of registration under the law of any juris-diction) covering or
purporting to cover any interest of any kind in the Collateral (other than
financing state-ments filed in respect of Permitted Liens), and so long as
the
Termination Date has not occurred, such Assignor will not execute or authorize
to be filed in any public office any financing state-ment (or similar statement
or instrument of registra-tion under the law of any jurisdiction) or state-ments
relating to the Collateral, except financ-ing statements filed or to be filed
in
respect of and covering the security interests granted hereby by such Assignor
or in connection with Permitted Liens.
2.4
Chief
Executive Office, Record Locations.
The
chief executive office of such Assignor is, on the date of this Agreement,
located at the address indicated on Annex A hereto for such Assignor. During
the
period of the four calendar months preceding the date of this Agreement, the
chief executive office of such Assignor has not been located at any address
other than that indicated on Annex A in accordance with the immediately
preceding sentence, in each case unless each such other address is also
indicated on Annex A hereto for such Assignor.
2.5
Location
of Inventory and Equipment.
All
Inventory and Equipment held on the date hereof, or held at any time during
the
four calendar months prior to the date hereof, by each Assignor is located
at
one of the locations shown on Annex B hereto for such Assignor.
2.6
Legal
Names; Type of Organization (and Whether a Registered Organization);
Jurisdiction of Organization; Location; Organizational Identification Numbers;
Changes Thereto; etc. The
exact
legal name of each Assignor, the type of organization of such Assignor, whether
or not such Assignor is a Registered Organization, the jurisdiction of
organization of such Assignor, such Assignor’s Location and the organizational
identification number (if any) of such Assignor is listed on Annex C hereto
for
such Assignor. Such Assignor shall not change its legal name, its type of
organization, its status as a Registered Organization (in the case of a
Registered Organization), its jurisdiction of organization, its Location, or
its
organizational identification number (if any) from that used on Annex C hereto,
except that any such changes shall be permitted (so long as not in violation
of
the applicable requirements of the Secured Debt Agreements and so long as same
do not involve (x) a Registered Organization ceasing to constitute same or
(y)
such Assignor changing its jurisdiction of organization or Location from the
United States or a State thereof to a jurisdiction of organization or Location,
as the case may be, outside the United States or a State thereof) if (i) it
shall have given to the First-Lien Collateral Agent not less than 15 days’ prior
written notice of each change to the information listed on Annex C (as adjusted
for any subsequent changes thereto previously made in accordance with this
sentence), together with a supplement to Annex C which shall correct all
information contained therein for such Assignor, and (ii) in connection with
the
respective such change or changes, it shall have taken all action reasonably
requested by the First-Lien Collateral Agent to maintain the security interests
of the First-Lien Collateral Agent in the Collateral intended to be granted
hereby at all times fully perfected and in full force and effect. In addition,
to the extent that such Assignor does not have an organizational identification
number on the date hereof and later obtains one, such Assignor shall promptly
thereafter notify the First-Lien Collateral Agent of such organizational
identification number and shall take all actions reasonably satisfactory to
the
First-Lien Collateral Agent to the extent necessary to maintain the security
interest of the First-Lien Collateral Agent in the Collateral intended to be
granted hereby fully perfected and in full force and effect.
-5-
2.7
Trade
Names; Etc. Such
Assignor does not have or operate in any jurisdiction under, and in the
preceding five years has not had or operated in any jurisdiction under, any
trade names, fictitious names or other names except its legal name as specified
in Annex C and such other trade or fictitious names as are listed on Annex
D
hereto for such Assignor. Such Assignor shall not assume or operate in any
jurisdiction under any new trade, fictitious or other name until (i) it shall
have given to the First-Lien Collateral Agent not less than 15 days’ written
notice of its intention so to do, clearly describing such new name and the
jurisdictions in which such new name will be used and providing such other
information in connection therewith as the First-Lien Collateral Agent may
reasonably request and (ii) with respect to such new name, it shall have taken
all action reasonably requested by the First-Lien Collateral Agent to maintain
the security interest of the First-Lien Collateral Agent in the Collateral
intended to be granted hereby at all times fully perfected and in full force
and
effect.
2.8
Certain
Significant Transactions. During
the one year period preceding the date of this Agreement, no Person shall have
merged or consolidated with or into any Assignor, and no Person shall have
liquidated into, or transferred all or substantially all of its assets to,
any
Assignor, in each case except as described in Annex E hereto. With respect
to
any transactions so described in Annex E hereto, the respective Assignor shall
have furnished such information with respect to the Person (and the assets
of
the Person and locations thereof) which merged with or into or consolidated
with
such Assignor, or was liquidated into or transferred all or substantially all
of
its assets to such Assignor, and shall have furnished to the First-Lien
Collateral Agent such UCC lien searches as may have been requested with respect
to such Person and its assets, to establish that no security interest (excluding
Permitted Liens) continues perfected on the date hereof with respect to any
Person described above (or the assets transferred to the respective Assignor
by
such Person), including without limitation pursuant to Section 9-316(a)(3)
of
the UCC.
-6-
2.9
Non-UCC
Property.
At any
time and from time to time, promptly (and in any event within 15 days) following
the request of the First-Lien Collateral Agent or the Required Secured
Creditors, the Assignors shall provide the First-Lien Collateral Agent a
reasonably detailed list (which includes reasonable estimates of the fair market
value (as determined by the Assignors in good faith)) of all property owned
by
all of the Assignors of the types described in clauses (1), (2) and (3) of
Section 9-311(a) of the UCC. At any time that the fair market value (as
determined by the Borrower or First-Lien Collateral Agent in good faith or
as
shown in any list delivered pursuant to the immediately preceding sentence)
of
the property owned by all of the Assignors of the types described in clauses
(1), (2) and (3) of Section 9-311(a) of the UCC exceeds $2,000,000, the
Assignors shall, but only upon the written request of the Required Secured
Creditors or the First-Lien Collateral Agent, within 60 days of such request
(or
such longer period as the Required Secured Creditors or the First-Lien
Collateral Agent may agree to in writing) take such actions (at their own cost
and expense) as may be required under the respective United States, State or
other laws referenced in Section 9-311(a) of the UCC to perfect the security
interests granted herein in any Collateral where the filing of a financing
statement does not perfect the security interest in such property in accordance
with the provisions of Section 9-311(a) of the UCC.
2.10
As-Extracted
Collateral; Timber-to-be-Cut.
On the
date hereof, such Assignor does not own, or expect to acquire, any property
which constitutes, or would constitute, As-Extracted Collateral or
Timber-to-be-Cut. If at any time after the date of this Agreement such Assignor
owns, acquires or obtains rights to any As-Extracted Collateral or
Timber-to-be-Cut, such Assignor shall furnish the First-Lien Collateral Agent
with prompt written notice thereof (which notice shall describe in reasonable
detail the As-Extracted Collateral and/or Timber-to-be-Cut and the locations
thereof) and shall take all actions as may be deemed reasonably necessary or
desirable by the First-Lien Collateral Agent to perfect the security interest
of
the First-Lien Collateral Agent therein.
2.11
Collateral
in the Possession of a Bailee.
If any
Inventory or other Goods are at any time in the possession of a bailee, such
Assignor shall promptly notify the First-Lien Collateral Agent thereof and,
if
requested by the First-Lien Collateral Agent, shall use its commercially
reasonable efforts to promptly obtain an acknowledgment from such bailee, in
form and substance reasonably satisfactory to the First-Lien Collateral Agent,
that the bailee holds such Collateral for the benefit of the First-Lien
Collateral Agent and shall act upon the instructions of the First-Lien
Collateral Agent, without the further consent of such Assignor. The First-Lien
Collateral Agent agrees with such Assignor that the First-Lien Collateral Agent
shall not give any such instructions unless an Event of Default has occurred
and
is continuing or would occur after taking into account any action by the
respective Assignor with respect to any such bailee.
2.12
Recourse.
This
Agreement is made with full recourse to each Assignor and pursuant to and upon
all the warranties, representations, covenants and agreements on the part of
such Assignor contained herein, in the Secured Debt Agreements and otherwise
in
writing in connection herewith or therewith.
-7-
ARTICLE
III
SPECIAL
PROVISIONS CONCERNING ACCOUNTS; CONTRACT RIGHTS;
INSTRUMENTS;
CHATTEL PAPER AND CERTAIN OTHER COLLATERAL
3.1
Additional
Representations and Warranties.
As of
the time when each of its material Accounts arises, each Assignor shall be
deemed to have represented and warranted that each such Account, and all
records, papers and documents relating thereto (if any) are genuine and what
they purport to be, and that all papers and documents (if any) relating thereto
(i) will, to the knowledge of such Assignor, repre-sent the genuine, legal,
valid and binding obligation of the account debtor evidencing indebt-xx-xxxx
unpaid and owed by the respective account debtor arising out of the performance
of labor or services or the sale or lease and delivery of the merchandise listed
therein, or both, (ii) will be the only original writings evidencing and
embodying such obligation of the account debtor named therein (other than copies
created for general accounting purposes), (iii) will, to the knowledge of such
Assignor, evidence true and valid obligations, enforceable in accordance with
their respective terms, and (iv) will be in compli-ance and will conform in
all
material respects with all applicable federal, state and local laws and
applicable laws of any relevant foreign jurisdiction.
3.2
Maintenance
of Records.
Each
Assignor will keep and maintain at its own cost and expense accurate records
of
its Accounts and Contracts, including, but not limited to, originals of all
documentation (including each Contract) with respect thereto, records of all
pay-ments received, all credits granted thereon, all merchandise returned and
all other dealings there-with, and such Assignor will make the same available
on
such Assignor’s premises to the First-Lien Collateral Agent for inspection, at
such Assignor’s own cost and expense, at any and all reason-able times upon
prior notice to such Assignor and otherwise in accordance with the Credit
Agreement. Upon the occurrence and during the continuance of an Event of Default
and at the request of the First-Lien Collateral Agent, such Assignor shall,
at
its own cost and expense, deliver all tangible evidence of its Accounts and
Contract Rights (including, without limitation, all documents evidencing the
Accounts and all Contracts) and such books and records to the First-Lien
Collateral Agent or to its representatives (copies of which evidence and books
and records may be retained by such Assignor). Upon the occurrence and during
the continuance of an Event of Default and if the First-Lien Collateral Agent
so
directs, such Assignor shall legend, in form and manner satisfactory to the
First-Lien Collateral Agent, the Accounts and the Contracts, as well as books,
records and documents (if any) of such Assignor evidencing or pertaining to
such
Accounts and Contracts with an appropriate reference to the fact that such
Accounts and Contracts have been assigned to the First-Lien Collateral Agent
and
that the First-Lien Collateral Agent has a security interest
therein.
3.3
Direction
to Account Debtors; Contracting Parties; etc. Upon
the
occurrence and during the continuance of an Event of Default, if the First-Lien
Collateral Agent so directs any Assignor, such Assignor agrees (x) to cause
all
payments on account of the Accounts and Contracts to be made directly to the
Cash Collateral Account, (y) that the First-Lien Collateral Agent may, at its
option, directly notify the obligors with respect to any Accounts and/or under
any Contracts to make payments with respect thereto as provided in the preceding
clause (x), and (z) that the First-Lien Collateral Agent may enforce collection
of any such Accounts and Contracts and may adjust, settle or compromise the
amount of payment thereof, in the same manner and to the same extent as such
Assignor. Without notice to or assent by any Assignor, the First-Lien Collateral
Agent may, upon the occurrence and during the continuance of an Event of
Default, apply any or all amounts then in, or thereafter deposited in, the
Cash
Collateral Account toward the payment of the Obligations in the manner provided
in Section 7.4 of this Agreement. The reasonable costs and expenses of
collection (includ-ing reasonable attorneys’ fees), whether incurred by an
Assignor or the First-Lien Collateral Agent, shall be borne by the relevant
Assignor. The First-Lien Collateral Agent shall deliver a copy of each notice
referred to in the preceding clause (y) to the relevant Assignor, provided
that (x)
the failure by the First-Lien Collateral Agent to so notify such Assignor shall
not affect the effectiveness of such notice or the other rights of the
First-Lien Collateral Agent created by this Section 3.3 and (y) no such notice
shall be required if an Event of Default of the type described in Section 10.05
of the Credit Agreement has occurred and is continuing.
-8-
3.4
Modification
of Terms; etc. Except
in
accordance with such Assignor’s ordinary course of business and consistent with
reasonable business judgment or as permitted by Section 3.5, no Assignor shall
rescind or cancel any indebtedness evidenced by any Account or under any
Contract, or modify any material term thereof or make any material adjustment
with respect thereto, or extend or renew the same, or compromise or settle
any
material dispute, claim, suit or legal proceeding relating thereto, or sell
any
Account or Contract, or interest therein, without the prior written consent
of
the First-Lien Collateral Agent. No Assignor will do anything to impair the
rights of the First-Lien Collateral Agent in the Accounts or
Contracts.
3.5
Collection.
Each
Assignor shall endeavor in accordance with reasonable busi-ness practices to
cause to be collected from the account debtor named in each of its Accounts
or
obligor under any Contract, as and when due (including, without limitation,
amounts which are delinquent, such amounts to be collected in accordance with
generally accepted lawful collection procedures) any and all amounts owing
under
or on account of such Account or Contract, and apply forthwith upon receipt
thereof all such amounts as are so collected to the outstanding balance of
such
Account or under such Contract. Except as otherwise directed by the First-Lien
Collateral Agent after the occurrence and during the continuation of an Event
of
Default, any Assignor may allow in the ordinary course of business as
adjustments to amounts owing under its Accounts and Contracts (i) an
extension or renewal of the time or times of payment, or settlement for less
than the total unpaid balance, which such Assignor finds appropriate in
accordance with reason-able business judgment and (ii) a refund or credit
due as a result of returned or damaged xxxxxxx-xxxx or improperly performed
services or for other reasons which such Assignor finds appropriate in
accordance with reasonable business judgment. The reasonable costs and expenses
(including, without limitation, reasonable attorneys’ fees) of collection,
whether incurred by an Assignor or the First-Lien Collateral Agent, shall be
borne by the relevant Assignor.
3.6
Instruments.
If any
Assignor owns or acquires any Instrument in excess of $100,000 constituting
Collateral (other than checks and other payment instruments received and
collected in the ordinary course of business), such Assignor will within 10
Business Days notify the First-Lien Collateral Agent thereof, and upon request
by the First-Lien Collateral Agent will promptly deliver such Instru-ment to
the
First-Lien Collateral Agent appropriately endorsed to the order of the
First-Lien Collateral Agent.
3.7
Assignors
Remain Liable Under Accounts.
Anything herein to the contrary notwithstanding, the Assignors shall remain
liable under each of the Accounts to observe and perform all of the conditions
and obligations to be observed and performed by it thereunder, all in accordance
with the terms of any agreement giving rise to such Accounts. Neither the
First-Lien Collateral Agent nor any other Secured Creditor shall have any
obligation or liability under any Account (or any agreement giving rise thereto)
by reason of or arising out of this Agreement or the receipt by the First-Lien
Collateral Agent or any other Secured Creditor of any payment relating to such
Account pursuant hereto, nor shall the First-Lien Collateral Agent or any other
Secured Creditor be obli-gated in any manner to perform any of the obligations
of any Assignor under or pursuant to any Account (or any agreement giving rise
thereto), to make any payment, to make any inquiry as to the nature or the
sufficiency of any payment received by them or as to the sufficiency of any
performance by any party under any Account (or any agreement giving rise
thereto), to present or file any claim, to take any action to enforce any
performance or to collect the payment of any amounts which may have been
assigned to them or to which they may be entitled at any time or
times.
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3.8
Assignors
Remain Liable Under Contracts.
Anything herein to the contrary notwithstanding, the Assignors shall remain
liable under each of the Contracts to observe and per-form all of the conditions
and obligations to be observed and performed by them thereunder, all in
accordance with and pursuant to the terms and provisions of each Contract.
Neither the First-Lien Collateral Agent nor any other Secured Creditor shall
have any obligation or liability under any Contract by reason of or arising
out
of this Agreement or the receipt by the First-Lien Collateral Agent or any
other
Secured Creditor of any payment relating to such Contract pursuant hereto,
nor
shall the First-Lien Collateral Agent or any other Secured Creditor be obligated
in any manner to perform any of the obligations of any Assignor under or
pursuant to any Contract, to make any payment, to make any inquiry as to the
nature or the sufficiency of any performance by any party under any Contract,
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 them or
to
which they may be entitled at any time or times.
3.9
Deposit
Accounts; Etc. (a)
No
Assignor maintains, or at any time after the date of this Agreement shall
establish or maintain, any demand, time, savings, passbook or similar account,
except for such accounts maintained with a bank (as defined in Section 9-102
of
the UCC) whose jurisdiction (determined in accordance with Section 9-304 of
the
UCC) is within a State of the United States. Annex
F
hereto accurately sets forth, as of the date of this Agreement, for each
Assignor, each Deposit Account maintained by such Assignor (including a
description thereof and the respective account number), the name of the
respective bank with which such Deposit Account is maintained, and the
jurisdiction of the respective bank with respect to such Deposit Account. For
each Deposit Account (other than the Cash Collateral Account, any other Deposit
Account maintained with the First-Lien Collateral Agent and, subject to the
terms contained in the definition thereof, any Designated Account), the
respective Assignor shall cause the bank with which the Deposit Account is
maintained to execute and deliver to the First-Lien Collateral Agent, within
45
days after the date of this Agreement (as such date may be extended by the
First-Lien Collateral Agent) or, if later, at the time of the establishment
of
the respective Deposit Account, a “control agreement” in the form of Annex G
hereto (appropriately completed), with such changes thereto as may be acceptable
to the First-Lien Collateral Agent. If any bank with which a Deposit Account
is
maintained refuses to, or does not, enter into such a “control agreement”, then
the respective Assignor shall promptly (and in any event within 45 days after
the date of this Agreement or, if later, 30 days after the establishment of
such
account) close the respective Deposit Account and transfer all balances therein
to the Cash Collateral Account or another Deposit Account meeting the
requirements of this Section 3.9. If any bank with which a Deposit Account
is
maintained refuses to subordinate all its claims, subject to customary
exceptions, with respect to such Deposit Account to the First-Lien Collateral
Agent’s security interest therein on terms satisfactory to the First-Lien
Collateral Agent, then the First-Lien Collateral Agent, at its option, may
(x)
require that such Deposit Account be terminated in accordance with the
immediately preceding sentence or (y) agree to a “control agreement” without
such subordination, provided that in such event the First-Lien Collateral Agent
may at any time, at its option, subsequently require that such Deposit Account
be terminated (within 30 days after notice from the First-Lien Collateral Agent,
as such date may be extended by the First-Lien Collateral Agent).
-10-
(b) After
the
date of this Agreement, no Assignor shall establish any new demand, time,
savings, passbook or similar account, except for Deposit Accounts established
and maintained with banks and meeting the requirements of preceding clause
(a).
At the time any such Deposit Account is established, the appropriate “control
agreement” shall be entered into in accordance with the requirements of
preceding clause (a) and the respective Assignor shall furnish to the First-Lien
Collateral Agent a supplement to Annex F hereto containing the relevant
information with respect to the respective Deposit Account and the bank with
which same is established.
3.10
Letter-of-Credit
Rights.
If any
Assignor is at any time a beneficiary under a letter of credit with a stated
amount of $1,000,000 or more, such Assignor shall promptly notify the First-Lien
Collateral Agent thereof and, at the request of the First-Lien Collateral Agent,
such Assignor shall, pursuant to an agreement in form and substance reasonably
satisfactory to the First-Lien Collateral Agent, use its reasonable best efforts
to (i) arrange for the issuer and any confirmer of such letter of credit to
consent to an assignment to the First-Lien Collateral Agent of the proceeds
of
any drawing under such letter of credit or (ii) arrange for the First-Lien
Collateral Agent to become the transferee beneficiary of such letter of credit,
with the First-Lien Collateral Agent agreeing, in each case, that the proceeds
of any drawing under the letter of credit are to be applied as provided in
this
Agreement after the occurrence and during the continuance of an Event of
Default.
3.11
Commercial
Tort Claims.
All
Commercial Tort Claims of each Assignor in existence on the date of this
Agreement are described in Annex H hereto. If any Assignor shall at any time
after the date of this Agreement acquire a Commercial Tort Claim in an amount
(taking the greater of the aggregate claimed damages thereunder or the
reasonably estimated value thereof) of $1,000,000 or more, such Assignor shall
promptly notify the First-Lien Collateral Agent thereof in a writing signed
by
such Assignor and describing the details thereof and shall grant to the
First-Lien Collateral Agent in such writing a security interest therein and
in
the proceeds thereof, all upon the terms of this Agreement, with such writing
to
be in form and substance reasonably satisfactory to the First-Lien Collateral
Agent.
3.12
Chattel
Paper.
Upon
the request of the First-Lien Collateral Agent made at any time or from time
to
time, each Assignor shall promptly furnish to the First-Lien Collateral Agent
a
list of all Electronic Chattel Paper held or owned by such Assignor.
Furthermore, if requested by the First-Lien Collateral Agent, each Assignor
shall promptly take all actions which are reasonably practicable so that the
First-Lien Collateral Agent has “control” of all Electronic Chattel Paper in
accordance with the requirements of Section 9-105 of the UCC. Each Assignor
will
promptly (and in any event within 10 days) following any request by the
First-Lien Collateral Agent, deliver all of its Tangible Chattel Paper to the
First-Lien Collateral Agent.
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3.13
Further
Actions.
Each
Assignor will, at its own expense, make, execute, endorse, acknowledge, file
and/or deliver to the First-Lien Collateral Agent from time to time such
vouchers, invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, certificates, reports and other assurances
or
instruments and take such further steps, including any and all actions as may
be
necessary or required under the Federal Assignment of Claims Act, relating
to
its Accounts, Contracts, Instruments and other property or rights covered by
the
security interest hereby granted, as the First-Lien Collateral Agent may
reasonably require.
ARTICLE
IV
SPECIAL
PROVISIONS CONCERNING TRADEMARKS AND DOMAIN NAMES
4.1
Additional
Representations and Warranties.
Each
Assignor represents and warrants that it is the true and lawful owner of all
right, title and interest in and to the registered Marks and Domain Names listed
in Annex I hereto for such Assignor and that said listed Marks and Domain Names
include all United States marks and applications for United States marks owned
or purported to be owned by such Assignor registered in the United States Patent
and Trademark Office, as well as all Domain Names that such Assignor owns or
purports to own as of the date hereof. Each Assignor represents and warrants
that it owns, is licensed to use or otherwise has the right to use any
trademarks, service marks or other indicia of origin, including trade dress,
and
any Internet domain names, that it uses. Each Assignor further warrants that
it
has no knowledge of any third party claim received by it that any aspect of
such
Assignor’s present or contemplated business oper-ations infringes or will
infringe any trademark, service xxxx or trade name of any other Person other
than as could not, either individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. Each Assignor represents and
warrants that the registrations of Marks listed in Annex I hereto are valid,
subsisting, have not been canceled and that such Assignor is not aware of any
third-party claim that any of said registrations is invalid or unenforceable,
and is not aware that there is any reason that any of said registrations is
invalid or unenforceable, and is not aware that there is any reason that any
of
said applications will not mature into registrations, other than as could not,
either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. Each Assignor hereby grants to the First-Lien
Collateral Agent an absolute power of attor-ney to sign, upon the occurrence
and
during the continuance of an Event of Default, any docu-ment which may be
required by the United States Patent and Trademark Office or similar registrar
in order to effect an absolute assignment of all right, title and interest
in
each Xxxx and/or Domain Name, and record the same.
4.2
Licenses
and Assignments.
Except
as otherwise permitted by the Secured Debt Agreements, each Assignor hereby
agrees not to divest itself of any right under any Xxxx or Domain Name absent
prior written approval of the First-Lien Collateral Agent.
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4.3
Infringements.
Each
Assignor agrees, promptly upon learning thereof, to notify the First-Lien
Collateral Agent in writing of the name and address of, and to furnish such
pertinent information that may be available with respect to, any party who
such
Assignor believes is, or is likely to be, infringing or diluting or otherwise
violating any of such Assignor’s rights in and to any Xxxx or Domain Name in any
manner that could reasonably be expected to have a Material Adverse Effect,
or
with respect to any party claiming that such Assignor’s use of any Xxxx or
Domain Name material to such Assignor’s business violates in any material
respect any property right of that party. Each Assignor further agrees to
prosecute diligently in accordance with reasonable business practices any Person
infringing any Xxxx or Domain Name in any manner that could reasonably be
expected to have a Material Adverse Effect.
4.4
Preservation
of Marks and Domain Names.
Each
Assignor agrees to use its Marks and Domain Names which are material to such
Assignor’s business in interstate commerce during the time in which this
Agreement is in effect and to take all such other actions as are reasonably
necessary to preserve such Marks as trademarks or service marks under the laws
of the United States (other than any such Marks which Assignor reasonably
determines are no longer used or useful in its business or
operations).
4.5
Maintenance
of Registration.
Each
Assignor shall, at its own expense, dili-gently process all documents reasonably
required to maintain all Xxxx and/or Domain Name registrations, including but
not limited to affidavits of use and applications for renewals of registration
in the United States Patent and Trademark Office for all of its material
registered Marks, and shall pay all fees and dis-xxxxx-ments in connection
therewith and shall not abandon any such filing of affidavit of use or any
such
application of renewal prior to the exhaustion of all administrative and
judicial remedies with-out prior written consent of the First-Lien Collateral
Agent (other than with respect to registrations and applications deemed by
such
Assignor in its reasonable business judgment to be no longer prudent to
pursue).
4.6
Future
Registered Marks and Domain Names.
If any
Xxxx registration is issued hereafter to any Assignor as a result of any
application now or hereafter pending before the United States Patent and
Trademark Office or any Domain Name is registered by Assignor, within 60 days
of
receipt of such certificate or similar indicia of ownership, such Assignor
shall
deliver to the First-Lien Collateral Agent a copy of such registration
certificate or similar indicia of ownership, and a grant of a security interest
in such Xxxx and/or Domain Name, to the First-Lien Collateral Agent and at
the
expense of such Assignor, confirming the grant of a security interest in such
Xxxx and/or Domain Name to the First-Lien Collateral Agent hereunder, the form
of such security to be substantially in the form of Annex L hereto or in such
other form as may be reasonably satisfactory to the First-Lien Collateral
Agent.
4.7
Remedies.
If an
Event of Default shall occur and be continuing, the First-Lien Collateral Agent
may, by written notice to the relevant Assignor, take any or all of the
following actions: (i) declare the entire right, title and interest of such
Assignor in and to each of the Marks and Domain Names, together with all
trademark rights and rights of protection to the same, vested in the First-Lien
Collateral Agent for the benefit of the Secured Creditors, in which event such
rights, title and interest shall immedi-ately vest, in the First-Lien Collateral
Agent for the benefit of the Secured Creditors, and the First-Lien Collateral
Agent shall be entitled to exercise the power of attorney referred to in Section
4.1 hereof to execute, cause to be acknowledged and notarized and record said
absolute assignment with the applicable agency or registrar; (ii) take and
use
or sell the Marks or Domain Names and the goodwill of such Assignor’s business
symbolized by the Marks or Domain Names and the right to carry on the business
and use the assets of such Assignor in connection with which the Marks or Domain
Names have been used; and (iii) direct such Assignor to refrain, in which event
such Assignor shall refrain, from using the Marks or Domain Names in any manner
whatso-ever, directly or indirectly, and such Assignor shall execute such
further documents that the First-Lien Collateral Agent may reasonably request
to
further confirm this and to transfer ownership of the Marks or Domain Names
and
registrations and any pending trademark applications in the United States Patent
and Trademark Office or applicable Domain Name registrar to the First-Lien
Collateral Agent.
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ARTICLE
V
SPECIAL
PROVISIONS CONCERNING PATENTS, COPYRIGHTS AND TRADE SECRETS
5.1
Additional
Representations and Warranties.
Each
Assignor represents and warrants that it is the true and lawful owner of all
rights in (i) the Trade Secret Rights, (ii) all right, title and interest in
and
to the Patents listed in Annex J hereto for such Assignor and that said Patents
include all the United States patents and applications for United States patents
that such Assignor owns as of the date hereof and (iii) all right, title and
interest in and to the registered Copyrights listed in Annex K hereto for such
Assignor and that said Copyrights include all the United States copyrights
registered with the United States Copyright Office and applications to United
States copyrights that such Assignor owns as of the date hereof. Each Assignor
further warrants that it has no knowledge of any third party claim that any
aspect of such Assignor’s present or contemplated business operations infringes
or will infringe any patent of any other Person or such Assignor has
misappropriated any trade secret or proprietary information which, either
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect. Each Assignor represents and warrants that the Patents
listed in Annex J hereto are valid, subsisting, have not been canceled and
that
such Assignor is not aware of any third-party claim that any of said Patents
are
invalid or unenforceable, and is not aware that there is any reason that any
of
said Patents are invalid or unenforceable, and is not aware that there is any
reason that any of said Patent applications will not mature into issued Patents.
Each Assignor hereby grants to the First-Lien Collateral Agent an absolute
power
of attorney to sign, upon the occurrence and during the continuance of any
Event
of Default, any document which may be required by the United States Patent
and
Trademark Office or the United States Copyright Office in order to effect an
absolute assignment of all right, title and interest in each Patent or
Copyright, and to record the same.
5.2
Licenses
and Assignments.
Except
as otherwise permitted by the Secured Debt Agreements, each Assignor hereby
agrees not to divest itself of any right under any Patent or Copyright absent
prior written approval of the First-Lien Collateral Agent.
5.3
Infringements.
Each
Assignor agrees, promptly upon learning thereof, to furnish the First-Lien
Collateral Agent in writing with all pertinent information available to such
Assignor with respect to any infringement, contributing infringement or active
inducement to infringe or other violation of such Assignor’s rights in any
Patent or Copyright or to any claim that the practice of any Patent or use
of
any Copyright vio-lates any property right of a third party, or with respect
to
any misappropriation of any Trade Secret Right or any claim that practice of
any
Trade Secret Right violates any property right of a third party, in each case,
in any manner which, either individually or in the aggregate, could reasonably
be expected to have a Material Adverse Effect. Each Assignor further agrees,
absent direction of the First-Lien Collateral Agent to the contrary, to
diligently prosecute, in accordance with its reasonable business judgment,
any
Person infringing any Patent or Copy-right or any Person misappropriating any
Trade Secret Right, in each case to the extent that such infringement or
misappropriation, either individually or in the aggregate, could reasonably
be
expected to have a Material Adverse Effect.
-14-
5.4
Maintenance
of Patents or Copyrights.
At its
own expense, each Assignor shall make timely payment of all post-issuance fees
required to maintain in force its rights under each Patent or Copyright, absent
prior written consent of the First-Lien Collateral Agent (other than any such
Patents or Copyrights which are no longer used or are deemed by such Assignor
in
its reasonable business judgment to no longer be useful in its business or
operations).
5.5
Prosecution
of Patent Applications.
At its
own expense, each Assignor shall diligently prosecute all material applications
for the United States Patents listed in Annex J hereto, in each case for
such Assignor and shall not abandon any such application prior to exhaustion
of
all administrative and judicial remedies (other than applications that are
deemed by such Assignor in its reasonable business judgment to no longer be
necessary in the conduct of the Assignor’s business), absent written consent of
the First-Lien Collateral Agent.
5.6
Other
Patents and Copyrights.
Within
30 days of the acquisition or issuance of a United States Patent, registration
of a Copyright, or acquisition of a registered Copyright, or of filing of an
application for a United States Patent or Copyright, the relevant Assignor
shall
deliver to the First-Lien Collateral Agent a copy of said Copyright or Patent,
or certificate or registration of, or appli-cation therefor, as the case may
be,
with a grant of a security interest as to such Patent or Copyright, as the
case
may be, to the First-Lien Collateral Agent and at the expense of such Assignor,
confirming the grant of a security interest, the form of such grant of a
security interest to be substan-tially in the form of Annex M or N hereto,
as
appropriate, or in such other form as may be reason-ably satisfactory to the
First-Lien Collateral Agent.
5.7
Remedies.
If an
Event of Default shall occur and be continuing, the First-Lien Collateral Agent
may, by written notice to the relevant Assignor, take any or all of the
following actions: (i) declare the entire right, title, and interest of such
Assignor in each of the Patents and Copyrights vested in the First-Lien
Collateral Agent for the benefit of the Secured Creditors, in which event such
right, title, and interest shall immediately vest in the First-Lien Collateral
Agent for the benefit of the Secured Creditors, in which case the First-Lien
Collateral Agent shall be entitled to exercise the power of attorney referred
to
in Section 5.1 hereof to execute, cause to be acknowledged and notarized and
to
record said absolute assignment with the applicable agency; (ii) take and
practice or sell the Patents and Copyrights; and (iii) direct such Assignor
to
refrain, in which event such Assignor shall refrain, from practicing the Patents
and using the Copyrights directly or indirectly, and such Assignor shall execute
such further documents as the First-Lien Collateral Agent may reasonably request
further to confirm this and to transfer ownership of the Patents and Copyrights
to the First-Lien Collateral Agent for the benefit of the Secured
Creditors.
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ARTICLE
VI
PROVISIONS
CONCERNING ALL COLLATERAL
6.1
Protection
of First-Lien Collateral Agent’s Security.
Except
as otherwise permitted by the Secured Debt Agreements, each Assignor will do
nothing to impair the rights of the First-Lien Collateral Agent in the
Collateral. Each Assignor will at all times maintain insurance, at such
Assignor’s own expense to the extent and in the manner provided in the Secured
Debt Agreements. Except to the extent otherwise permitted to be retained by
such
Assignor or applied by such Assignor pursuant to the terms of the Secured Debt
Agreements, the First-Lien Collateral Agent shall, at the time any proceeds
of
such insurance are distributed to the Secured Creditors, apply such proceeds
in
accordance with Section 7.4 hereof. Each Assignor assumes all liability and
responsibility in connection with the Collateral acquired by it and the
liability of such Assignor to pay the Obligations shall in no way be affected
or
dimin-ished by reason of the fact that such Collateral may be lost, destroyed,
stolen, damaged or for any reason whatsoever unavailable to such
Assignor.
6.2
Warehouse
Receipts Non-Negotiable.
To the
extent practicable, each Assignor agrees that if any xxxx-house receipt or
receipt in the nature of a warehouse receipt is issued with respect to any
of
its Inventory, such Assignor shall request that such warehouse receipt or
receipt in the nature thereof shall not be “negotiable” (as such term is used in
Section 7-104 of the Uniform Commercial Code as in effect in any relevant
jurisdiction or under other relevant law).
6.3
Additional
Information.Each
Assignor will, at its own expense, from time to time upon the reasonable request
of the First-Lien Collateral Agent, promptly (and in any event within 10 days
after its receipt of the respective request) furnish to the First-Lien
Collateral Agent such information with respect to the Collateral (including
the
identity of the Collateral or such components thereof as may have been requested
by the First-Lien Collateral Agent, the value and location of such Collateral,
etc.) as may be requested by the First-Lien Collateral Agent. Without limiting
the forgoing, each Assignor agrees that it shall promptly (and in any event
within 10 days after its receipt of the respective request) furnish to the
First-Lien Collateral Agent such updated Annexes hereto as may from time to
time
be reasonably requested by the First-Lien Collateral Agent.
6.4
Further
Actions.
Each
Assignor will, at its own expense and upon the reason-able request of the
First-Lien Collateral Agent, make, execute, endorse, acknowledge, file and/or
deliver to the First-Lien Collateral Agent from time to time such lists,
descriptions and designations of its Collateral, warehouse receipts, receipts
in
the nature of warehouse receipts, bills of lading, docu-ments of title,
vouchers, invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorse-ments, certificates, reports and other assurances
or instruments and take such further steps relating to the Collateral and other
property or rights covered by the security interest hereby granted, which the
First-Lien Collateral Agent deems reasonably appropriate or advisable to
perfect, preserve or protect its security interest in the
Collateral.
-16-
6.5
Financing
Statements.
Each
Assignor agrees to authorize and deliver to the First-Lien Collateral Agent
such
financing statements, in form reasonably acceptable to the First-Lien Collateral
Agent, as the First-Lien Collateral Agent may from time to time reasonably
request or as are reasonably necessary or desirable in the opinion of the
First-Lien Collateral Agent to establish and maintain a valid, enforceable,
perfected security interest in the Collateral as provided herein and the other
rights and security contemplated hereby. Each Assignor will pay any applicable
filing fees, recordation taxes and related expenses relating to its Collateral.
Each Assignor hereby authorizes the First-Lien Collateral Agent to file any
such
financing statements without the signature of such Assignor where permitted
by
law (and such authorization includes describing the Collateral as “all assets”
of such Assignor).
ARTICLE
VII
REMEDIES
UPON OCCURRENCE OF AN EVENT OF DEFAULT
7.1
Remedies;
Obtaining the Collateral Upon Default.
Each
Assignor agrees that, if any Event of Default shall have occurred and be
continuing, then and in every such case, the First-Lien Collateral Agent, in
addition to any rights now or hereafter existing under the other provisions
of
this Agreement, shall have all rights as a secured creditor under any UCC,
and
such additional rights and remedies to which a secured creditor is entitled
under the laws in effect in all relevant jurisdictions and may:
(i) personally,
or by agents or attorneys, immediately take possession of the Collateral or
any
part thereof, from such Assignor or any other Person who then has possession
of
any part thereof with or without notice or process of law, and for that purpose
may enter upon such Assignor’s premises where any of the Collateral is located
and remove the same and use in connection with such removal any and all
services, supplies, aids and other facilities of such Assignor;
(ii) instruct
the obligor or obligors on any agreement, instrument or other obligation
(including, without limitation, the Accounts and the Contracts) consti-tuting
the Collateral to make any payment required by the terms of such agreement,
instrument or other obligation directly to the First-Lien Collateral Agent
and
may exercise any and all remedies of such Assignor in respect of such
Collateral;
(iii) instruct
all banks which have entered into a control agreement with the First-Lien
Collateral Agent to transfer all monies, securities and instruments held by
such
depositary bank to the Cash Collateral Account;
(iv) sell,
assign or otherwise liquidate any or all of the Collateral or any part thereof
in accordance with Section 7.2 hereof, or direct such Assignor to sell, assign
or otherwise liquidate any or all of the Collateral or any part thereof, and,
in
each case, take possession of the proceeds of any such sale or
liquidation;
(v) take
possession of the Collateral or any part thereof, by directing such Assignor
in
writing to deliver the same to the First-Lien Collateral Agent at any reasonable
place or places designated by the First-Lien Collateral Agent, in which event
such Assignor shall at its own expense:
-17-
(x) forthwith
cause the same to be moved to the place or places so designated by the
First-Lien Collateral Agent and there delivered to the First-Lien Collateral
Agent;
(y) store
and
keep any Collateral so delivered to the First-Lien Collateral Agent at such
place or places pending further action by the First-Lien Collateral Agent as
provided in Section 7.2 hereof; and
(z) while
the
Collateral shall be so stored and kept, provide such security and maintenance
services as shall be reasonably necessary to protect the same and to preserve
and maintain it in good condition;
(vi) subject
to any exclusive license issued prior to the Event of Default, license or
sublicense, whether on an exclusive or nonexclusive basis, any Marks, Domain
Names, Patents or Copyrights included in the Collateral for such term and on
such conditions and in such manner as the First-Lien Collateral Agent shall
in
its sole judgment determine; provided in the case of Marks to the maintenance
of
quality standards, not less than comparable to the standards in place at the
time of the Event of Default;
(vii) apply
any
monies constituting Collateral or proceeds thereof in accordance with the
provisions of Section 7.4; and
(viii) take
any
other action as specified in clauses (1) through (5), inclusive, of Section
9-607 of the UCC;
it
being
understood that each Assignor’s obligation so to deliver the Collateral is of
the essence of this Agreement and that, accordingly, upon application to a
court
of equity having jurisdiction, the First-Lien Collateral Agent shall be entitled
to a decree requiring specific per-formance by such Assignor of said obligation.
By accepting the benefits of this Agreement and each other Security Document,
the Secured Creditors expressly acknowledge and agree that this Agreement and
each other Security Document may be enforced only by the action of the
First-Lien Collateral Agent acting upon the instruc-tions of the Required
Secured Creditors and that no other Secured Creditor shall have any right
individually to seek to enforce or to enforce this Agreement or to realize
upon
the security to be granted hereby, it being understood and agreed that such
rights and remedies may be exercised by the First-Lien Collateral Agent or
the
holders of at least a majority of the outstanding Other Obligations, as the
case
may be, for the benefit of the Secured Creditors upon the terms of this
Agreement and the other Security Documents. Furthermore, each Assignor agrees
to, upon the occurrence and continuance of an Event of Default, use its
commercially reasonable efforts to assist the First-Lien Collateral Agent in
obtaining any approvals or assignments or licenses from any relevant
Governmental Authority that may be necessary for the exercise of the rights
and
remedies of the First-Lien Collateral Agent with respect to the
Collateral.
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7.2
Remedies;
Disposition of the Collateral.
If any
Event of Default shall have occurred and be continuing, then any Collateral
repossessed by the First-Lien Collateral Agent under or pursuant to Section
7.1
hereof and any other Collateral whether or not so re-possessed by the First-Lien
Collateral Agent, may be sold, assigned, leased or otherwise disposed of under
one or more con-tracts or as an entirety, and without the necessity of gathering
at the place of sale the property to be sold, and in general in such manner,
at
such time or times, at such place or places and on such terms as the First-Lien
Collateral Agent may, in compliance with any mandatory requirements of
applicable law, determine to be commercially reasonable. Any of the Collateral
may be sold, leased or other-wise disposed of, in the condition in which the
same existed when taken by the First-Lien Collateral Agent or after any overhaul
or repair at the expense of the relevant Assignor which the First-Lien
Collateral Agent shall determine to be commercially reasonable. Any such sale,
lease or other disposition may be effected by means of a public disposition
or
private disposition, effected in accordance with the applicable requirements
(in
each case if and to the extent applicable) of Sections 9-610 through 9-613
of
the UCC and/or such other mandatory requirements of applicable law as may apply
to the respective disposition. The First-Lien Collateral Agent may, with-out
notice or publication, adjourn any public or private disposition or cause the
same to be adjourned from time to time by announcement at the time and place
fixed for the disposition, and such disposition may be made at any time or
place
to which the disposition may be so adjourned. To the extent permitted by any
such requirement of law, the First-Lien Collateral Agent may bid for and become
the purchaser (and may pay all or any portion of the purchase price by crediting
Obligations against the purchase price) of the Collateral or any item thereof,
offered for disposition in accordance with this Section 7.2 without
account-ability to the relevant Assignor. If, under applicable law, the
First-Lien Collateral Agent shall be permitted to make disposition of the
Collateral within a period of time which does not permit the giving of notice
to
the relevant Assignor as hereinabove specified, the First-Lien Collateral Agent
need give such Assignor only such notice of disposition as shall be required
by
such applicable law. Each Assignor agrees to do or cause to be done all such
other acts and things as may be reasonably necessary to make such disposition
or
dispositions of all or any portion of the Collateral valid and binding and
in
compliance with any and all applicable laws, regulations, orders, writs,
injunctions, decrees or awards of any and all courts, arbitrators or
governmental instrumentalities, domestic or foreign, having jurisdic-tion over
any such sale or sales, all at such Assignor’s expense.
7.3
Waiver
of Claims.
Except
as otherwise provided in this Agreement, EACH AS-XXXXXX HEREBY WAIVES, TO THE
EXTENT PERMITTED BY APPLICABLE LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION
WITH THE FIRST-LIEN COLLATERAL AGENT’S TAKING POSSESSION OR THE FIRST-LIEN
COLLATERAL AGENT’S DISPOSITION OF ANY OF THE COLLATERAL, INCLUDING, WITHOUT
LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY
OR
REMEDIES, and each Assignor hereby further waives, to the extent permitted
by
law:
(i) all
damages occasioned by such taking of possession or any such disposition except
any damages which are the direct result of the First-Lien Collateral Agent’s
gross negligence or willful misconduct (as determined by a court of competent
jurisdiction in a final and non-appealable decision);
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(ii) all
other
requirements as to the time, place and terms of sale or other require-ments
with
respect to the enforcement of the First-Lien Collateral Agent’s rights
here-under; and
(iii) all
rights of redemption, appraisement, valuation, stay, extension or moratorium
now
or hereafter in force under any applicable law in order to prevent or delay
the
en-forcement of this Agreement or the absolute sale of the Collateral or any
portion thereof, and each Assignor, for itself and all who may claim under
it,
insofar as it or they now or here-after lawfully may, hereby waives the benefit
of all such laws.
Any
sale
of, or the grant of options to purchase, or any other realization upon, any
Collateral shall operate to divest all right, title, interest, claim and demand,
either at law or in equity, of the rele-vant Assignor therein and thereto,
and
shall be a perpetual bar both at law and in equity against such Assignor and
against any and all Persons claiming or at-tempting to claim the Collateral
so
sold, optioned or realized upon, or any part thereof, from, through and under
such Assignor.
7.4
Application
of Proceeds.
(a) All
moneys collected by the First-Lien Collateral Agent (or, to the extent the
Pledge Agreement or any other Security Document requires proceeds of collateral
under such other Security Document to be applied in accordance with the
provisions of this Agreement, the Pledgee or First-Lien Collateral Agent under
such other Security Document) upon any sale or other disposition of the
Collateral, together with all other moneys received by the First-Lien Collateral
Agent hereunder, shall be applied as follows:
(i) first,
to the
payment of all amounts owing the First-Lien Collateral Agent of the type
described in clauses (iii), (iv) and (v) of the definition of
“Obligations”;
(ii) second,
to the
extent proceeds remain after the application pursuant to the preceding clause
(i), to the payment of all amounts owing to any Agent of the type described
in
clauses (v) and (vi) of the definition of “Obligations”;
(iii) third,
to the
extent proceeds remain after the application pursuant to the preceding clauses
(i) and (ii), an amount equal to the outstanding Primary Obligations shall
be
paid to the Secured Creditors as provided in Section 7.4(e) hereof, with each
Secured Creditor receiving an amount equal to its outstanding Primary
Obligations or, if the proceeds are insufficient to pay in full all such Primary
Obligations, its Pro Rata Share of the amount remaining to be
distributed;
(iv) fourth,
to the
extent proceeds remain after the application pursuant to the preceding clauses
(i) through (iii), inclusive, an amount equal to the outstanding Secondary
Obligations shall be paid to the Secured Creditors as provided in Section 7.4(e)
hereof, with each Secured Creditor receiving an amount equal to its outstanding
Secondary Obligations or, if the proceeds are insufficient to pay in full all
such Secondary Obligations, its Pro Rata Share of the amount remaining to be
distributed; and
(v) fifth,
to the
extent proceeds remain after the application pursuant to the preced-ing clauses
(i) through (iv), inclusive, and following the termination of this Agreement
pursuant to Section 10.8(a) hereof, to the relevant Assignor or to whomever
may
be lawfully entitled to receive such surplus.
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(b) For
purposes of this Agreement, (x) “Pro
Rata Share”
shall
mean, when cal-culating a Secured Creditor’s portion of any distribution or
amount, that amount (expressed as a percentage) equal to a fraction the
numerator of which is the then unpaid amount of such Secured Creditor’s Primary
Obligations or Secondary Obligations, as the case may be, and the denominator
of
which is the then outstanding amount of all Primary Obligations or Secondary
Obligations, as the case may be, (y) “Primary
Obligations”
shall
mean (i) in the case of the Credit Document Obligations, all principal of,
premium, fees and interest on, all Loans, all Unpaid Drawings, the Stated Amount
of all outstanding Letters of Credit and all Fees and (ii) in the case of the
Other Obligations, all amounts due under each Interest Rate Protection Agreement
and each Other Hedging Agree-ment with an Other Creditor (other than
indemnities, fees (including, without limita-tion, attorneys’ fees) and similar
obligations and liabilities) and (z) “Secondary
Obligations”
shall
mean all Obligations other than Primary Obligations.
(c) When
payments to Secured Creditors are based upon their respective Pro Rata Shares,
the amounts received by such Secured Creditors hereunder shall be applied (for
purposes of making determinations under this Section 7.4 only) (i) first, to
their Primary Obliga-tions and (ii) second, to their Secondary Obligations.
If
any payment to any Secured Creditor of its Pro Rata Share of any distribution
would result in overpayment to such Secured Creditor, such excess amount shall
instead be distributed in respect of the unpaid Primary Obligations or Secondary
Obligations, as the case may be, of the other Secured Creditors, with each
Secured Creditor whose Primary Obligations or Secondary Obligations, as the
case
may be, have not been paid in full to receive an amount equal to such excess
amount multiplied by a fraction the numer-ator of which is the unpaid Primary
Obligations or Secondary Obligations, as the case may be, of such Secured
Creditor and the denominator of which is the unpaid Primary Obligations or
Secondary Obligations, as the case may be, of all Secured Creditors entitled
to
such distribution.
(d) Each
of
the Secured Creditors, by their acceptance of the benefits hereof and of the
other Security Documents, agrees and acknowledges that if the Lender Creditors
receive a distribution on account of undrawn amounts with respect to Letters
of
Credit issued under the Credit Agreement (which shall only occur after all
outstanding Revolving Loans under the Credit Agreement and Unpaid Drawings
have
been paid in full), such amounts shall be paid to the Administrative Agent
under
the Credit Agreement and held by it, for the equal and ratable benefit of the
Lender Creditors, as cash security for the repayment of Obligations owing to
the
Lender Creditors as such. If any amounts are held as cash security pursuant
to
the immediately preceding sentence, then upon the termina-tion of all
outstanding Letters of Credit under the Credit Agreement, and after the
application of all such cash security to the repayment of all Obligations owing
to the Lender Creditors after giving effect to the termin-ation of all such
Letters of Credit, if there remains any excess cash, such excess cash shall
be
returned by the Administrative Agent to the First-Lien Collateral Agent for
distribution in accordance with Section 7.4(a) hereof.
(e) All
payments required to be made hereunder shall be made (x) if to the Lender
Creditors, to the Administrative Agent for the account of the Lender Creditors
and (y) if to the Other Creditors, to the trustee, paying agent or other similar
representative (each, a “Representative”)
for
the Other Creditors or, in the absence of such a Representative, directly to
the
Other Creditors.
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(f) For
purposes of applying payments received in accordance with this Section 7.4,
the
First-Lien Collateral Agent shall be entitled to rely upon (i) the
Administrative Agent and (ii) the Representative or, in the absence of such
a
Representative, upon the Other Creditors for a determination (which the
Administrative Agent, each Representative and the Other Creditors agree (or
shall agree) to provide upon request of the First-Lien Collateral Agent) of
the
outstanding Primary Obligations and Secondary Obligations owed to the Lender
Creditors or the Other Creditors, as the case may be. Unless it has received
written notice from a Lender Creditor or an Other Creditor to the contrary,
the
Administrative Agent and each Representative, in furnishing information pursuant
to the preceding sentence, and the First-Lien Collateral Agent, in acting
hereunder, shall be entitled to assume that no Secondary Obligations are
outstanding. Unless it has written notice from an Other Creditor to the
contrary, the First-Lien Collateral Agent, in acting hereunder, shall be
entitled to assume that no Interest Rate Protection Agreements or Other Hedging
Agreements are in existence.
(g) It
is
understood that the Assignors shall remain jointly and severally liable to
the
extent of any deficiency between the amount of the proceeds of the Collateral
and the aggregate amount of the Obligations.
7.5
Remedies
Cumulative.
Each
and every right, power and remedy hereby specifically given to the First-Lien
Collateral Agent shall be in addition to every other right, power and remedy
specifically given to the First-Lien Collateral Agent under this Agreement,
the
other Secured Debt Agreements or now or hereafter existing at law, in equity
or
by statute, and each and every right, power and remedy whether specifically
herein given or otherwise existing may be exercised from time to time or
simultaneously and as often and in such order as may be deemed expedient by
the
First-Lien Collateral Agent. All such rights, powers and remedies shall be
cumulative and the exercise or the beginning of the exercise of one shall not
be
deemed a waiver of the right to exercise any other or others. No delay or
omission of the First-Lien Collateral Agent in the exercise of any such right,
power or remedy and no renewal or extension of any of the Obligations shall
impair any such right, power or remedy or shall be construed to be a waiver
of
any Default or Event of Default or an acquiescence thereof. No notice to or
demand on any Assignor in any case shall entitle it to any other or further
notice or demand in similar or other circumstances or constitute a waiver of
any
of the rights of the First-Lien Collateral Agent to any other or further action
in any circumstances without notice or demand. In the event that the First-Lien
Collateral Agent shall bring any suit to enforce any of its rights here-under
and shall be entitled to judgment, then in such suit the First-Lien Collateral
Agent may recover reasonable expenses, including reasonable attorneys’ fees, and
the amounts thereof shall be included in such judgment.
7.6
Discontinuance
of Proceedings.
In case
the First-Lien Collateral Agent shall have insti-tuted any proceeding to enforce
any right, power or remedy under this Agreement by foreclosure, sale, entry
or
otherwise, and such proceeding shall have been discontinued or abandoned for
any
reason or shall have been determined adversely to the First-Lien Collateral
Agent, then and in every such case the relevant Assignor, the First-Lien
Collateral Agent and each holder of any of the Obligations shall be restored
to
their former positions and rights hereunder with respect to the Collateral
subject to the security interest created under this Agreement, and all rights,
remedies and powers of the First-Lien Collateral Agent shall continue as if
no
such proceeding had been instituted.
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ARTICLE
VIII
INDEMNITY
8.1
Indemnity.
(a) Each Assignor jointly and severally agrees to indemni-fy,
xxxx-xxxxx and hold the First-Lien Collateral Agent, each other Secured Creditor
and their respective successors, assigns, employees, affiliates and agents
(hereinafter in this Section 8.1 referred to individually as “Indemnitee,”
and
collectively as “Indemnitees”)
harmless from any and all liabilities, obligations, damages, injuries,
penalties, claims, demands, actions, suits, judgments and any and all costs,
expenses or disbursements (including reasonable attorneys’ fees and expenses)
(for the purposes of this Section 8.1 the foregoing are collectively called
“expenses”) of what-soever kind and nature imposed on, asserted against or
incurred by any of the Indemnitees in any way relating to or arising out of
this
Agreement, any other Secured Debt Agreement or any other document executed
in
connection herewith or therewith or in any other way connected with the
administration of the transactions contemplated hereby or thereby or the
enforcement of any of the terms of, or the preservation of any rights under
any
thereof, or in any way relating to or arising out of the manufacture, ownership,
ordering, purchase, delivery, control, acceptance, lease, financing, possession,
operation, condition, sale, return or other disposition, or use of the
Collateral (including, without limitation, latent or other defects, whether
or
not discov-erable); provided that no Indemnitee shall be indemnified pursuant
to
this Section 8.1(a) for losses, damages or liabilities to the extent caused
by
the gross negligence or willful misconduct of such Indemnitee (as determined
by
a court of competent jurisdiction in a final and non-appealable decision).
Each
Assignor agrees that upon written notice by any Indemnitee of the assertion
of
such a liability, obligation, damage, injury, penalty, claim, demand, action,
suit or judgment, the relevant Assignor shall assume full responsibility for
the
defense thereof. Each Indemnitee agrees to use its best efforts to promptly
notify the relevant Assignor of any such assertion of which such Indemnitee
has
knowledge.
(b) Without
limiting the application of Section 8.1(a) hereof, each Assignor agrees, jointly
and severally, to pay or reimburse the First-Lien Collateral Agent for any
and
all reasonable fees, costs and expenses of whatever kind or nature incurred
in
connection with the creation, preser-va-tion or protection of the First-Lien
Collateral Agent’s Liens on, and security interest in, the Collateral,
including, without limitation, all fees and taxes in connection with the
recording or filing of instruments and documents in public offices, payment
or
discharge of any taxes or Liens upon or in respect of the Collateral, premiums
for insurance with respect to the Collateral and all other fees, costs and
expenses in connection with protecting, maintaining or preserving the Collateral
and the First-Lien Collateral Agent’s interest therein, whether through judicial
proceedings or other-wise, or in defending or prosecuting any actions, suits
or
proceedings arising out of or relating to the Collateral.
(c) Without
limiting the application of Section 8.1(a) or (b) hereof, each Assignor agrees,
jointly and severally, to pay, indemnify and hold each Indemnitee harmless
from
and against any loss, costs, damages and expenses which such Indemnitee may
suffer, expend or incur in consequence of or growing out of any
misrepresentation by any Assignor in this Agreement, any other Secured Debt
Agreement or in any writing con-templated by or made or delivered by any
Assignor pursuant to or in connection with this Agreement or any other Secured
Debt Agreement.
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(d) If
and to
the extent that the obligations of any Assignor under this Section 8.1 are
unenforceable for any reason, such Assignor hereby agrees to make the maximum
contribution to the payment and satisfaction of such obligations which is
permissible under applicable law.
8.2
Indemnity
Obligations Secured by Collateral; Survival.
Any
amounts paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral. The
indemnity obligations of each Assignor contained in this Article VIII shall
continue in full force and effect notwithstanding the full payment of all of
the
other Obligations and notwithstanding the full payment of all the Notes issued,
and Loans made, under the Credit Agreement, the termination of all Letters
of
Credit issued under the Credit Agreement, the termination of all Interest Rate
Protection Agreements and Other Hedging Agreements entered into with the Other
Creditors and the payment of all other Obligations and notwithstanding the
discharge thereof and the occurrence of the Termination Date.
ARTICLE
IX
DEFINITIONS
The
following terms shall have the meanings herein specified. Such defi-nitions
shall be equally applicable to the singular and plural forms of the terms
defined.
“Account”
shall
mean any “account” as such term is defined in the Uniform Commercial Code as in
effect on the date hereof in the State of New York, and in any event shall
include, but shall not be limited to, all rights to payment of any monetary
obligation, whether or not earned by performance, (i) for property that has
been
or is to be sold, leased, licensed, assigned or otherwise disposed of, (ii)
for
services rendered or to be rendered, (iii) for a policy of insurance issued
or
to be issued, (iv) for a secondary obligation incurred or to be incurred, (v)
for energy provided or to be provided, (vi) for the use or hire of a vessel
under a charter or other contract, (vii) arising out of the use of a credit
or
charge card or information contained on or for use with the card, or (viii)
as
winnings in a lottery or other game of chance operated or sponsored by a State,
governmental unit of a State, or person licensed or authorized to operate the
game by a State or governmental unit of a State. Without limiting the foregoing,
the term “account” shall include all Health-Care-Insurance
Receivables.
“Administrative
Agent”
shall
have the meaning provided in the recitals of this Agreement.
“Agreement”
shall
mean this Security Agreement as the same may be amended, modified, restated
and/or supplemented from time to time in accordance with its terms.
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“As-Extracted
Collateral”
shall
mean “as-extracted collateral” as such term is defined in the Uniform Commercial
Code as in effect on the date hereof in the State of New York.
“Assignor”
shall
have the meaning provided in the first paragraph of this Agreement.
“Borrower”
shall
have the meaning provided in the recitals of this Agreement.
“Cash
Collateral Account”
shall
mean a cash collateral account maintained with, and in the sole dominion and
control of, the First-Lien Collateral Agent for the benefit of the Secured
Creditors.
“Chattel
Paper”
shall
mean “chattel paper” as such term is defined in the Uniform Commercial Code as
in effect on the date hereof in the State of New York. Without limiting the
foregoing, the term “Chattel Paper” shall in any event include all Tangible
Chattel Paper and all Electronic Chattel Paper.
“Class”
shall
have the meaning provided in Section 10.2 of this Agreement.
“Collateral”
shall
have the meaning provided in Section 1.1(a) of this Agreement.
“Commercial
Tort Claims”
shall
mean “commercial tort claims” as such term is defined in the Uniform Commercial
Code as in effect on the date hereof in the State of New York.
“Contract
Rights”
shall
mean all rights of any Assignor under each Contract, including, without
limitation, (i) any and all rights to receive and demand payments under any
or
all Contracts, (ii) any and all rights to receive and compel performance under
any or all Contracts and (iii) any and all other rights, interests and claims
now existing or in the future arising in connection with any or all
Contracts.
“Contracts”
shall
mean all contracts between any Assignor and one or more additional parties
(including, without limitation, any Interest Rate Protection Agreements, Other
Hedging Agreements, licensing agreements and any partnership agreements, joint
venture agree-ments and limited liability company agreements).
“Copyrights”
shall
mean any United States or foreign copyright now or hereafter owned by any
Assignor, including any registrations of any copyrights in the United States
Copyright Office or any foreign equivalent office, as well as any application
for a copyright registration now or hereafter made with the United States
Copyright Office or any foreign equivalent office by any Assignor.
“Credit
Agreement”
shall
have the meaning provided in the recitals of this Agreement.
“Credit
Document Obligations”
shall
have the meaning provided in the definition of “Obligations” in this Article
IX.
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“Deposit
Accounts”
shall
mean all “deposit accounts” as such term is defined in the Uniform Commercial
Code as in effect on the date hereof in the State of New York.
“Designated
Accounts”
shall
mean those Deposit Accounts set forth on Part B of Annex F hereto; provided
that at
such time as any Designated Account shall cease to secure exclusively the
obligations described therein with respect to such Designated Account, the
respective Assignor shall promptly (and in any event within three Business
Days)
provide the First-Lien Collateral Agent with written notice thereof, and the
First-Lien Collateral Agent, at its option, may require that such Assignor
cause
the institution with which such Designated Account is maintained to execute
and
deliver to the First-Lien Collateral Agent within 45 days a “control agreement”
as described in Section 3.9 hereof or otherwise to comply with the requirements
of said Section with respect to such Designated Account.
“Documents”
shall
mean “documents” as such term is defined in the Uniform Commercial Code as in
effect on the date hereof in the State of New York.
“Domain
Names”
shall
mean all Internet domain names and associated URL addresses in or to which
any
Assignor now or hereafter has any right, title or interest.
“Electronic
Chattel Paper”
shall
mean “electronic chattel paper” as such term is defined in the Uniform
Commercial Code as in effect on the date hereof in the State of New
York.
“Equipment”
shall
mean any “equipment” as such term is defined in the Uniform Commercial Code as
in effect on the date hereof in the State of New York, and in any event shall
include, but shall not be limited to, all machinery, equipment, furnishings,
fixtures and vehicles now or hereafter owned by any Assignor and any and all
additions, substitutions and replacements of any of the foregoing and all
accessions thereto, wherever located, together with all attachments,
com-ponents, parts, equipment and accessories installed thereon or affixed
thereto.
“Event
of Default”
shall
mean any Event of Default under, and as defined in, the Credit Agreement and
shall in any event include, without limitation, any payment default on any
of
the Obligations after the expiration of any applicable grace
period.
“First-Lien
Collateral Agent”
shall
have the meaning provided in the first paragraph of this Agreement.
“General
Intangibles”
shall
mean “general intangibles” as such term is defined in the Uniform Commercial
Code as in effect on the date hereof in the State of New York.
“Goods”
shall
mean “goods” as such term is defined in the Uniform Commercial Code as in effect
on the date hereof in the State of New York.
“Health-Care-Insurance
Receivable”
shall
mean any “health-care-insurance receivable” as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York.
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“Indemnitee”
shall
have the meaning provided in Section 8.1(a) of this Agreement.
“Instrument”
shall
mean “instruments” as such term is defined in the Uniform Commercial Code as in
effect on the date hereof in the State of New York.
“Inventory”
shall
mean merchandise, inventory and goods, and all additions, substi-tutions and
replacements thereof and all accessions thereto, wherever located, together
with
all goods, supplies, incidentals, packaging materials, labels, materials and
any
other items used or to be used in manu-facturing, processing, packaging or
shipping same, in all stages of production from raw materials through work
in
process to finished goods, and all products and proceeds of whatever sort and
wherever located, any portion thereof which may be returned, rejected, reclaimed
or repossessed by the First-Lien Collateral Agent from any Assignor’s customers,
and shall specifically include all “inventory” as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York.
“Investment
Property”
shall
mean “investment property” as such term is defined in the Uniform Commercial
Code as in effect on the date hereof in the State of New York.
“Lender
Creditors”
shall
have the meaning provided in the recitals of this Agreement.
“Lenders”
shall
have the meaning provided in the recitals of this Agreement.
“Letter-of-Credit
Rights”
shall
mean “letter-of-credit rights” as such term is defined in the Uniform Commercial
Code as in effect on the date hereof in the State of New York.
“Location”
of
any
Assignor, shall mean such Assignor’s “location” as determined pursuant to
Section 9-307 of the UCC.
“Marks”
shall
mean all right, title and interest in and to any trademarks, service marks,
trade names, trade dress, logos, fictitious business names, and other business
identifiers, including the goodwill of the business of such Assignor associated
with each of the foregoing, now held or hereafter acquired by any Assignor,
the
right to xxx for past or future infringement thereof and including any
registration or application for registration or renewals thereof of any
trademarks and service marks now held or hereafter acquired by any Assignor,
which are registered or filed in the United States Patent and Trademark Office
or the equivalent thereof in any state of the United States or any equivalent
foreign office or agency.
“Material
Adverse Effect”
shall
mean a material adverse effect on the business, property, assets, liabilities
(actual or contingent), operations or condition (financial or otherwise) of
the
Borrower and its Subsidiaries taken as a whole.
“Maximum
Hedging Obligations Notional Amount”
shall
mean an aggregate notional amount equal to $325 million.
“Obligations”
shall
mean and include, as to any Assignor, all of the following:
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(i)
the full and prompt payment when due (whether at stated maturity, by
acceleration or otherwise) of all obligations, liabilities and indebtedness
(including, with-out limitation, principal, premium, interest (including,
without limitation, all interest that accrues after the commencement of any
case, proceeding or other action relating to the bankruptcy, insolvency,
reorganization or similar proceeding of any Assignor at the rate provided for
in
the respective documentation, whether or not a claim for post-petition interest
is allowed in any such proceeding), reimbursement obligations under Letters
of
Credit, fees, costs and indemnities) of such Assignor to the Lender Creditors,
whether now existing or hereafter incurred under, arising out of, or in
connection with, the Credit Agreement and the other Credit Documents to which
such Assignor is a party (including, with-out limitation, in the event such
Assignor is a Guarantor, all such obligations, liabilities and indebt-xx-xxxx
of
such Assignor under its Guaranty) and the due per-formance and compli-ance
by
such Assignor with all of the terms, conditions and agreements contained in
the
Credit Agreement and in such other Credit Documents (all such obligations,
liabilities and indebtedness under this clause (i), except to the extent
consisting of obligations or indebtedness with respect to Interest Rate
Protection Agreements or Other Hedging Agreements, being herein collectively
called the “Credit
Document Obligations”);
(ii)
the full and prompt payment when due (whether at stated maturity, by
acceler-ation or otherwise) of all obligations, liabilities and indebtedness
(including, without limitation, all interest that accrues after the commencement
of any case, proceeding or other action relating to the bankruptcy, insolvency,
reorganization or similar proceeding of any Assignor at the rate provided for
in
the respective documentation, whether or not a claim for post-petition interest
is allowed in any such proceeding) owing by such Assignor to the Other
Creditors, now existing or hereafter incurred under, arising out of or in
connection with any Interest Rate Protection Agreement or Other Hedging
Agreement, whether such Interest Rate Protection Agreement or Other Hedging
Agreement is now in existence or hereinafter arising (including, with-out
limitation, in the case of a Assignor that is a Guarantor, all obligations,
liabilities and indebtedness of such Assignor under its Guaranty in respect
of
the Interest Rate Protection Agreements and Other Hedging Agreements), and
the
due performance and compliance by such Assignor with all of the terms,
conditions and agreements contained in each such Interest Rate Protection
Agreement and Other Hedging Agreement (all such obligations, liabilities and
indebtedness under this clause (ii) being herein collectively called the
“Other
Obligations”);
provided
that if
the aggregate notional amount of all then outstanding Interest Rate Protection
Agreements and Other Hedging Agreements would exceed the Maximum Hedging
Obligations Notional Amount, then amounts owing with respect to such excess
shall not constitute Other Obligations hereunder; provided further
that, if
at the time of the entering into of any Interest Rate Protection Agreement
or
Other Hedging Agreement the respective Other Creditors obtained an officer’s
certificate of the Borrower or a representation by the Borrower that the
aggregate notional amount thereof when added to the aggregate notional amount
of
all other then outstanding Interest Rate Protection Agreements and Other Hedging
Agreements which constitute Other Obligations hereunder, shall not or would
not
exceed the Maximum Hedging Obligations Notional Amount, then such Interest
Rate
Protection Agreement or Other Hedging Agreement, as the case may be, (and all
obligations thereunder as described above) shall constitute Other Obligations
for all purposes hereof notwithstanding the fact that the Maximum Hedging
Obligations Notional Amount has actually been exceeded;
-28-
(iii)
any and all sums advanced by the First-Lien Collateral Agent in order to
preserve the Collateral or preserve its security interest in the Collateral;
(iv)
in the event of any proceeding for the collection or enforcement of any
indebtedness, obligations, or liabilities of such Assignor referred to in
clauses (i) and (ii) above, after an Event of Default shall have occurred and
be
continuing, the reasonable expenses of retaking, holding, preparing for sale
or
lease, selling or otherwise disposing of or realizing on the Collateral, or
of
any exercise by the First-Lien Collateral Agent of its rights hereunder,
together with reasonable attorneys’ fees and court costs;
(v)
all amounts paid by any Indemnitee as to which such Indemnitee has the
right to xxxx-xxxxx-ment under Section 8.1 of this Agreement; and
(vi)
all amounts owing to any Agent pursuant to any of the Credit Documents in
its capacity as such;
it
being
acknowledged and agreed that the “Obligations” shall include extensions of
credit of the types described above, whether outstanding on the date of this
Agreement or extended from time to time after the date of this
Agreement.
“Other
Creditors”
shall
have the meaning provided in the recitals of this Agreement.
“Other
Obligations”
shall
have the meaning provided in the definition of “Obligations” in this Article
IX.
“Patents”
shall
mean any patent in or to which any Assignor now or hereafter has any right,
title or interest therein, and any divisions, continuations (including, but
not
limited to, continuations-in-parts) and improvements thereof, including the
right to xxx for any past or future infringement thereof, as well as any
application for a patent now or hereafter made by any Assignor.
“Permits”
shall
mean, to the extent permitted to be assigned by the terms thereof or by
applicable law, all licenses, permits, rights, orders, variances, franchises
or
authorizations of or from any governmental authority or agency.
“Primary
Obligations”
shall
have the meaning provided in Section 7.4(b) of this Agreement.
“Pro
Rata Share”
shall
have the meaning provided in Section 7.4(b) of this Agreement.
“Proceeds”
shall
mean all “proceeds” as such term is defined in the Uniform Commercial Code as in
effect in the State of New York on the date hereof and, in any event, shall
also
include, but not be limited to, (i) any and all proceeds of any insurance,
indemnity, warranty or guaranty payable to the First-Lien Collateral Agent
or
any Assignor from time to time with respect to any of the Collateral, (ii)
any
and all payments (in any form whatsoever) made or due and payable to any
Assignor from time to time in connection with any requisition, confiscation,
condemnation, seizure or forfeiture of all or any part of the Collateral by
any
governmental authority (or any person acting under color of gov-ernmental
authority) and (iii) any and all other amounts from time to time paid or payable
under or in connection with any of the Collateral.
-29-
“Registered
Organization”
shall
have the meaning provided in the Uniform Commercial Code as in effect in the
State of New York.
“Representative”
shall
have the meaning provided in Section 7.4(e) of this Agreement.
“Required
Secured Creditors”
shall
mean (i) at any time when any Credit Document Obligations are outstanding or
any
Commitments under the Credit Agreement exist, the Required Lenders (or, to
the
extent provided in Section 13.12 of the Credit Agreement, each of the Lenders)
and (ii) at any time after all of the Credit Document Obligations have been
paid
in full and all Commitments under the Credit Agreement have been terminated
and
no further Commitments may be provided thereunder, the holders of a majority
of
the Other Obligations.
“Requisite
Creditors”
shall
have the meaning provided in Section 10.2 of this Agreement.
“Secondary
Obligations”
shall
have the meaning provided in Section 7.4(b) of this Agreement.
“Secured
Creditors”
shall
have the meaning provided in the recitals of this Agreement.
“Secured
Debt Agreements”
shall
mean and include this Agreement, the other Credit Documents and the Interest
Rate Protection Agreements and Other Hedging Agreements entered into with an
Other Creditor.
“Software”
shall
mean “software” as such term is defined in the Uniform Commercial Code as in
effect on the date hereof in the State of New York.
“Supporting
Obligations”
shall
mean any “supporting obligation” as such term is defined in the Uniform
Commercial Code as in effect on the date hereof in the State of New York, now
or
hereafter owned by any Assignor, or in which any Assignor has any rights, and,
in any event, shall include, but shall not be limited to, all of such Assignor’s
rights in any Letter-of-Credit Right or secondary obligation that supports
the
payment or performance of, and all security for, any Account, Chattel Paper,
Document, General Intangible, Instrument or Investment Property.
“Tangible
Chattel Paper”
shall
mean “tangible chattel paper” as such term is defined in the Uniform Commercial
Code as in effect on the date hereof in the State of New York.
-30-
“Termination
Date”
shall
have the meaning provided in Section 10.8(a) of this Agreement.
“Timber-to-be-Cut”
shall
mean “timber-to-be-cut” as such term is defined in the Uniform Commercial Code
as in effect on the date hereof in the State of New York.
“Trade
Secrets”
shall
mean any secretly held existing engineering or other data, information,
production procedures and other know-how relating to the design, manufacture,
assembly, installation, use, operation, marketing, sale and/or servicing of
any
products or business of an Assignor worldwide whether written or
not.
“Trade
Secret Rights”
shall
mean the rights of an Assignor in any Trade Secret it holds.
“Transmitting
Utility”
shall
have the meaning given such term in Section 9-102(a)(80) of the
UCC.
“UCC”
shall
mean the Uniform Commercial Code as in effect from time to time in the relevant
jurisdiction.
ARTICLE
X
MISCELLANEOUS
10.1
Notices.
Except
as otherwise specified herein, all notices, requests, demands or other
communications to or upon the respective parties hereto shall be sent or
delivered by mail, telegraph, telex, telecopy, cable or courier service and
all
such notices and communications shall, when mailed, telegraphed, telexed,
telecopied, or cabled or sent by courier, be effective when deposited in the
mails, delivered to the telegraph com-pany, cable company or over-night courier,
as the case may be, or sent by telex or telecopier, except that notices and
communications to the First-Lien Collateral Agent or any Assignor shall not
be
effective until received by the First-Lien Collateral Agent or such Assignor,
as
the case may be. All notices and other communications shall be in writing and
addressed as follows:
| (a) |
if
to any Assignor, c/o:
|
c/o
RCN
Corporation
000
Xxx
Xxxxx Xxxxxx
Xxxxxxx,
XX 00000
Attention:
Xxxxxx X’Xxxx
Telephone
No.: (000) 000-0000
Telecopier
No.: (000) 000-0000
-31-
With
a
copy to:
RCN
Corporation
000
Xxx
Xxxxx Xxxxxx
Xxxxxxx,
XX 00000
Attention:
Xxxxxxxx X. Xxxxxxx
Telephone
No.: (000) 000-0000
Telecopier
No.: (000) 000-0000
| (b) |
if
to the First-Lien Collateral Agent,
at:
|
00
Xxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxx Xxxxxx
Telephone
No.: (000) 000-0000
Telecopier
No.: (000) 000-0000
(c)
if
to any
Lender Creditor (other than the First-Lien Collateral Agent), at such address
as
such Lender Creditor shall have specified in the Credit Agreement;
(d)
if
to any
Other Creditor, at such address as such Other Creditor shall have specified
in
writing to each Assignor and the First-Lien Collateral Agent;
or
at
such other address or addressed to such other individual as shall have been
furnished in writing by any Person described above to the party required to
give
notice hereunder.
10.2
Waiver;
Amendment.
Except
as provided in Sections 10.8 and 10.12, none of the terms and conditions of
this
Agreement may be changed, waived, modified or varied in any manner whatsoever
unless in writing duly signed by each Assignor directly affected thereby (it
being understood that the addition or release of any Assignor hereunder shall
not constitute a change, waiver, discharge or termination affecting any Assignor
other than the Assignor so added or released) and the First-Lien Collateral
Agent (with the written con-sent of the Required Secured Creditors);
provided,
however,
that
any change, waiver, modi-fi-ca-tion or variance affecting the rights and
benefits of a single Class of Secured Creditors (and not all Secured Creditors
in a like or similar manner) also shall require the written consent of the
Requisite Creditors of such affected Class. For the purpose of this Agreement,
the term “Class”
shall
mean each class of Secured Creditors, i.e.,
whether
(x) the Lender Creditors as holders of the Credit Document Obligations or (y)
the Other Creditors as the holders of the Other Obligations. For the purpose
of
this Agreement, the term “Requisite
Creditors”
of
any
Class shall mean each of (x) with respect to the Credit Document Obligations,
the Required Lenders (or, to the extent provided in Section 13.12 of the Credit
Agreement, each of the Lenders), and (y) with respect to the Other Obligations,
the holders of at least a majority of the aggregate notional amount of all
Other
Obligations outstanding from time to time.
10.3
Obligations
Absolute.
The
obligations of each Assignor hereunder shall remain in full force and effect
without regard to, and shall not be impaired by, (a) any bankruptcy, insolvency,
reorganization, arrangement, readjustment, composition, liquidation or the
like
of such Assignor; (b) any exercise or non-exercise, or any waiver of, any right,
remedy, power or privilege under or in respect of this Agreement or any other
Secured Debt Agreement; or (c) any amendment to or modification of any Secured
Debt Agreement or any security for any of the Obligations; whether or not such
Assignor shall have notice or knowledge of any of the foregoing.
-32-
10.4
Successors
and Assigns.
This
Agreement shall create a continuing security interest in the Collateral and
shall (i) remain in full force and effect, subject to release and/or termination
as set forth in Section 10.8, (ii) be binding upon each Assignor, its successors
and assigns; provided,
however,
that no
Assignor shall assign any of its rights or obligations hereunder without the
prior written consent of the First-Lien Collateral Agent (with the prior written
consent of the Required Secured Creditors), and (iii) inure, together with
the
rights and remedies of the First-Lien Collateral Agent hereunder, to the benefit
of the First-Lien Collateral Agent, the other Secured Creditors and their
respective successors, transferees and assigns. All agreements, statements,
representations and warranties made by each Assignor herein or in any
certificate or other instrument delivered by such Assignor or on its behalf
under this Agreement shall be considered to have been relied upon by the Secured
Credi-tors and shall survive the execution and delivery of this Agreement and
the other Secured Debt Agreements regardless of any investigation made by the
Secured Creditors or on their behalf.
10.5
Headings
Descriptive.
The
headings of the several sections of this Agreement are inserted for convenience
only and shall not in any way affect the meaning or construction of any
provision of this Agreement.
10.6
GOVERNING
LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL.(a)
THIS
AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW
YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER
CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF
THE
UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, IN EACH CASE LOCATED IN
THE
COUNTY OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH
ASSIGNOR HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID
COURTS. EACH ASSIGNOR HEREBY FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY
SUCH
COURTS LACK JURISDICTION OVER SUCH ASSIGNOR, AND AGREES NOT TO PLEAD OR CLAIM
IN
ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER
CREDIT DOCUMENT BROUGHT IN ANY OF THE AFORESAID COURTS THAT ANY SUCH COURT
LACKS
JURISDICTION OVER SUCH ASSIGNOR. EACH ASSIGNOR FURTHER IRREVOCABLY CONSENTS
TO
THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH
ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED
MAIL, POSTAGE PREPAID, TO ANY SUCH ASSIGNOR AT ITS ADDRESS FOR NOTICES AS
PROVIDED IN SECTION 10.1 ABOVE, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER
SUCH MAILING. EACH ASSIGNOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO SUCH
SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR
CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER ANY OTHER CREDIT
DOCUMENT THAT SUCH SERVICE OF PROCESS WAS IN ANY WAY INVALID OR INEFFECTIVE.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE FIRST-LIEN COLLATERAL AGENT UNDER
THIS AGREEMENT, OR ANY SECURED CREDITOR, TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST
ANY ASSIGNOR IN ANY OTHER JURISDICTION.
-33-
(b) EACH
ASSIGNOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS
ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT
BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY FURTHER
IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT
ANY
SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
(c) EACH
OF
THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL
BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.
10.7
Assignor’s
Duties.
It is
expressly agreed, anything herein contained to the contrary notwithstanding,
that each Assignor shall remain liable to perform all of the obligations, if
any, assumed by it with respect to the Collateral and the First-Lien Collateral
Agent shall not have any obli-gations or liabilities with respect to any
Collateral by reason of or arising out of this Agreement, nor shall the
First-Lien Collateral Agent be required or obligated in any manner to perform
or
fulfill any of the obligations of any Assignor under or with respect to any
Collateral.
10.8
Termination;
Release.
(a) After the Termination Date, this Agreement shall terminate
(provided that all indemnities set forth herein including, without limitation,
in Section 8.1 hereof, shall survive such termination) and the First-Lien
Collateral Agent, at the request and expense of the respective Assignor, will
promptly execute and deliver to such Assignor a proper instrument or instruments
(including Uniform Commercial Code termination statements on form UCC-3)
acknowledging the satisfaction and termination of this Agreement, and will
duly
assign, trans-fer and deliver to such Assignor (without recourse and without
any
representation or warranty) such of the Collateral as may be in the possession
of the First-Lien Collateral Agent and as has not theretofore been sold or
otherwise applied or released pursuant to this Agreement. As used in this
Agreement, “Termination
Date”
shall
mean the date upon which the Total Commitment under the Credit Agreement has
been terminated and all Interest Rate Protection Agreements and Other Hedging
Agreements entered into with any Other Creditor have been terminated, no Note
under the Credit Agreement is outstanding and all Loans thereunder have been
repaid in full, all Letters of Credit issued under the Credit Agreement have
been terminated and all Obligations then due and payable have been paid in
full.
-34-
(b) In
the
event that any part of the Collateral is sold or otherwise disposed of (to
a
Person other than a Credit Party) (x) at any time prior to the time at which
all
Credit Document Obligations have been paid in full and all Commitments and
Letters of Credit under the Credit Agreement have been terminated, in connection
with a sale or disposition permitted by Section 9.02 of the Credit Agreement
or
is otherwise released at the direction of the Required Lenders (or all the
Lenders if required by Section 13.12 of the Credit Agreement) or (y) at any
time
thereafter, to the extent permitted by the other Secured Debt Agreements, and
in
the case of clauses (x) and (y), the proceeds of such sale or disposition (or
from such release) are applied in accordance with the terms of the Credit
Agreement or such other Secured Debt Agreement, as the case may be, to the
extent required to be so applied, the First-Lien Collateral Agent, at the
request and expense of such Assignor, will duly release from the security
interest created hereby (and will execute and deliver such documentation,
including termination or partial release statements and the like in connection
therewith) and assign, transfer and deliver to such Assignor (without recourse
and without any representation or warranty) such of the Collateral as is then
being (or has been) so sold or otherwise disposed of, or released, and as may
be
in the possession of the First-Lien Collateral Agent and has not theretofore
been released pursuant to this Agreement. Furthermore, upon the release of
any
Subsidiary Guarantor from the Subsidiaries Guaranty in accordance with the
provisions thereof, such Assignor (and the Collateral at such time assigned
by
the respective Assignor pursuant hereto) shall be released from this Agreement.
(c) If
the
Borrower designates any of its Subsidiaries as an Unrestricted Subsidiary in
accordance with Section 8.17 of the Credit Agreement, then, so long as on or
prior to such time such Unrestricted Subsidiary has been released from any
and
all Existing Second-Lien Security Documents or, if applicable, any and all
security documentation related to any Permitted Refinancing Indebtedness in
respect of the Existing Second-Lien Notes, the First-Lien Collateral Agent,
at
the request and expense of the Borrower, shall release from the security
interest created hereby the Collateral owned by such Unrestricted Subsidiary
(and will execute and deliver such documentation, including termination or
partial release statements and the like in connection therewith) and shall
assign, transfer and deliver to such Unrestricted Subsidiary (without recourse
and without any representation or warranty) such Collateral as may be in the
possession of the First-Lien Collateral Agent and has not theretofore been
released pursuant to this Agreement.
(d) At
any
time that an Assignor desires that the First-Lien Collateral Agent take any
action to acknowledge or give effect to any release of Collateral pursuant
to
the foregoing Section 10.8(a),(b) or (c), such Assignor shall deliver to the
First-Lien Collateral Agent a certificate signed by a principal executive
officer of such Assignor stating that the release of the respective Collateral
is permitted pursuant to such Section 10.8(a), (b) or (c). At any time that
the
Borrower or the respective Assignor desires that a Subsidiary of the Borrower
which has been released from the Subsidiaries Guaranty be released hereunder
as
provided in the last sentence of Section 10.8(b), it shall deliver to the
First-Lien Collateral Agent a certificate signed by a principal executive
officer of the Borrower and the respective Assignor stating that the release
of
the respective Assignor (and its Collateral) is permitted pursuant to such
Section 10.8(b). If reasonably requested by the First-Lien Collateral Agent
(although the First-Lien Collateral Agent shall have not obligation to make
such
request), the relevant Assignor shall furnish appropriate legal opinions (from
counsel, reasonably acceptable to the First-Lien Collateral Agent) to the effect
set forth in this Section 10.8(d).
-35-
(e) The
First-Lien Collateral Agent shall have no liability whatsoever to any other
Secured Creditor as the result of any release of Collateral by it in accordance
with (or which the First-Lien Collateral Agent in the absence of gross
negligence and willful misconduct believes to be in accordance with) this
Section 10.8.
10.9
Counterparts. This
Agreement may be executed in any number of counter-parts and by the different
parties hereto on separate counterparts, each of which when so executed and
delivered shall be an original, but all of which shall together constitute
one
and the same instrument. A set of counterparts executed by all the parties
hereto shall be lodged with the Borrower and the First-Lien Collateral
Agent.
10.10
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.
10.11
The
First-Lien Collateral Agent and the other Secured Creditors.
The
First-Lien Collateral Agent will hold in accordance with this Agreement all
items of the Collateral at any time received under this Agreement. It is
expressly understood and agreed that the obligations of the First-Lien
Collateral Agent as holder of the Collateral and interests therein and with
respect to the disposition thereof, and otherwise under this Agreement, are
only
those expressly set forth in this Agreement and in Section 12 of the Credit
Agreement. The First-Lien Collateral Agent shall act hereunder on the terms
and
condi-tions set forth herein and in Section 12 of the Credit
Agreement.
10.12
Additional
Assignors.
It is
understood and agreed that any Subsidiary Guarantor that desires to become
an
Assignor hereunder, or is required to execute a counterpart of this Agreement
after the date hereof pursuant to the requirements of the Credit Agreement
or
any other Credit Document, shall become an Assignor hereunder by executing
a
counterpart hereof and delivering same to the First-Lien Collateral Agent,
or by
executing an assumption agreement in form and substance satisfactory to the
First-Lien Collateral Agent, (y) delivering supplements to Annexes A through
F,
inclusive, and H through K, inclusive, hereto as are necessary to cause such
Annexes to be complete and accurate with respect to such additional Assignor
on
such date and (z) taking all actions as specified in this Agreement as would
have been taken by such Assignor had it been an original party to this
Agreement, in each case with all documents required above to be delivered to
the
First-Lien Collateral Agent and with all documents and actions required above
to
be taken to the reasonable satisfaction of the First-Lien Collateral
Agent.
10.13
Compliance
with Laws.
Each
Assignor agrees, following the occurrence and during the continuance of an
Event
of Default, to use commercially reasonable efforts, including taking any action
which the First-Lien Collateral Agent and the Secured Creditors may reasonably
request, to assist in obtaining any required consent or approval of the
Federal Communications Commission (the “FCC”)
or any
other governmental or other authority for any sale or transfer of control of
the
Collateral contemplated by the Security Documents pursuant to the exercise
of
the rights and remedies of the First-Lien Collateral Agent and the Secured
Creditors thereunder, including, upon request, to prepare, sign and file with
the FCC the assignor's or transferor's and licensee's portions of any
applications required under the rules of the FCC for consent to the assignment
or transfer of control of any FCC construction permit, license or other
authorization.
-36-
Each
Assignor further consents, subject to obtaining any necessary approvals,
following the occurrence and during the continuance of an Event of Default,
to
the assignment or transfer of control of any FCC or other governmental
construction permit, license, or other authorization to operate, to a receiver,
trustee, or similar official or to any purchaser of the Collateral pursuant
to
any public or private sale, judicial sale, foreclosure, or exercise of other
remedies available to First-Lien Collateral Agent and the Secured Creditors
as
permitted by applicable law. Notwithstanding anything herein which may be
construed to the contrary, no action shall be taken by any of the First-Lien
Collateral Agent and the Secured Creditors with respect to any license of the
FCC unless and until any applicable rules and regulations thereunder, requiring
the consent to or approval of such action by the FCC or any governmental or
other authority, have been satisfied.
[Remainder
of this page intentionally left blank; signature page
follows]
-37-
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered by their duly authorized officers as of the date first above
written.
(i)
RCN
CORPORATION
21ST
CENTURY
TELECOM SERVICES, INC.
BRAINSTORM
NETWORKS, INC.
HOT
SPOTS
PRODUCTIONS, INC.
ON
TV,
INC.
RCN-BECOCOM,
INC.
RCN
CABLE
TV OF CHICAGO, INC.
RCN
ENTERTAINMENT, INC.
RCN
FINANCE, LLC
By:
RCN
Corporation, its managing
member
RCN
FINANCIAL MANAGEMENT, INC.
RCN
INTERNATIONAL HOLDINGS, INC.
RCN
INTERNET SERVICES, INC.
RCN
NEW
YORK COMMUNICATIONS HOLDING COMPANY, INC.
RCN
NEW
YORK COMMUNICATIONS,
LLC
By:
RCN
New York Communications Holding Company, Inc., its managing member
RCN
TELECOM SERVICES, INC.
RCN
TELECOM SERVICES OF ILLINOIS, LLC
By:
RCN
Corporation, its managing
member
RCN
TELECOM SERVICES OF MASSACHUSETTS, INC.
RCN
TELECOM SERVICES OF PHILADELPHIA, INC.
RCN
TELECOM SERVICES OF VIRGINIA, INC.
RCN
TELECOM SERVICES OF WASHINGTON D.C., INC.
RFM
2,
LLC
By:
RCN
Corporation, its managing
member
RLH
PROPERTY CORPORATION
STARPOWER
COMMUNICATIONS, LLC
By:
RCN
Telecom Services of Washington D.C., Inc., its managing member
TEC
AIR,
INC.
UNET
HOLDING, INC.,
as
Assignors
|
By:
|
/s/ Xxxxxxx X. Xxxxxx
|
|
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Name:
Xxxxxxx X. Xxxxxx
|
||
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Title:
EVP & Chief Financial Officer
|
||
(ii)
Accepted
and Agreed to:
DEUTSCHE
BANK TRUST COMPANY
AMERICAS,
as
First-Lien Collateral Agent
|
By:
|
Xxxx Xxxxxx
|
|
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Name:
Xxxx Xxxxxx
|
||
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Title:
Director
|
||
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By:
|
/s/ Xxxxx X. Xxxxx
|
|
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Name:
Xxxxx X. Xxxxx
|
||
|
Title:
Director
|
||
(iii)
