EXHIBIT 10.1.2
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SECURITY AGREEMENT
Dated as of February 9, 2004
made by
CENTENNIAL CELLULAR OPERATING CO. LLC,
as Borrower,
CENTENNIAL PUERTO RICO OPERATIONS CORP.,
as PR Borrower,
and
EACH OF THE GUARANTORS LISTED ON THE SIGNATURE PAGES HERETO OR FROM TIME TO TIME
PARTY HERETO BY EXECUTION OF A JOINDER
AGREEMENT,
as Guarantors
in favor of
CREDIT SUISSE FIRST BOSTON
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TABLE OF CONTENTS
Page
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SECTION 1. Pledge................................................................................ 2
SECTION 2. Secured Obligations................................................................... 9
SECTION 3. FCC Approvals and Municipal Approvals................................................. 9
SECTION 4. No Release............................................................................ 10
SECTION 5. Perfection; Supplements; Further Assurances; Use of Pledged Collateral................ 10
SECTION 6. Representations, Warranties and Covenants............................................. 13
SECTION 7. Special Provisions Concerning General Collateral...................................... 18
SECTION 8. Special Provisions Concerning Securities Collateral................................... 19
SECTION 9. Special Provisions Concerning Intellectual Property Collateral........................ 21
SECTION 10. Special Provisions Concerning Financial Accounts...................................... 24
SECTION 11. Transfers and Other Liens............................................................. 27
SECTION 12. Reasonable Care....................................................................... 27
SECTION 13. Remedies upon Default; Obtaining the Pledged Collateral upon Event of Default......... 27
SECTION 14. Application of Proceeds............................................................... 33
SECTION 15. Expenses.............................................................................. 33
SECTION 16. No Waiver; Cumulative Remedies........................................................ 34
SECTION 17. Administrative Agent.................................................................. 34
SECTION 18. Administrative Agent May Perform; Administrative Agent Appointed Attorney-in-Fact..... 35
SECTION 19. Indemnity............................................................................. 35
SECTION 20. Modification in Writing............................................................... 36
SECTION 21. Termination; Release.................................................................. 36
SECTION 22. Notices............................................................................... 37
SECTION 23. Continuing Security Interest; Assignment.............................................. 37
SECTION 24. Governing Law......................................................................... 37
SECTION 25. Waiver of Jury Trial.................................................................. 38
SECTION 26. Severability of Provisions............................................................ 38
SECTION 27. Execution in Counterparts............................................................. 38
SECTION 28. Headings.............................................................................. 00
-x-
XXXXXXX 00. Obligations Absolute.................................................................. 38
SECTION 30. Future Advances....................................................................... 39
Annexes
A-1 Prior Liens
A-2 Guarantors
Exhibits
1. Form of Issuer Acknowledgment
2. Form of Deposit Account Control Agreement
3. Form of Securities Pledge Amendment
4. Form of Joinder Agreement
Schedules
I-A Guarantors that Own Capital Stock of Subsidiaries
I-B Guarantors that Own Uncertificated Equity Interests in Subsidiaries that
are Partnerships or Limited Liability Companies
II Intercompany Notes
III Patents
IV Trademarks
V Copyrights
VI Licenses
VII Financial Accounts
-ii-
SCHEDULE VII
SECURITY AGREEMENT (this
"Agreement"), dated as of February 9, 2004,
made by CENTENNIAL CELLULAR OPERATING CO.
LLC, a Delaware limited liability company
having an office at 0000 Xxxxx 000, Xxxx,
Xxx Xxxxxx 00000 ("Borrower"), CENTENNIAL
PUERTO RICO OPERATIONS CORP., a Delaware
corporation having an office at 0000 Xxxxx
000, Xxxx, Xxx Xxxxxx 00000 ("PR Borrower";
together with Borrower, the "Borrowers"),
and EACH OF THE GUARANTORS LISTED ON THE
SIGNATURE PAGES HERETO OR FROM TIME TO TIME
PARTY HERETO BY EXECUTION OF A JOINDER
AGREEMENT (collectively, the "Guarantors";
together with Borrower and the PR Borrower,
the "Pledgors", and each, a "Pledgor"), as
pledgors, assignors and debtors, in favor of
CREDIT SUISSE FIRST BOSTON, having an xxxxxx
xx Xxxxxx Xxxxxxx Xxxxxx, Xxx Xxxx, XX
00000, in its capacity as administrative
agent, as pledgee, assignee and secured
party (in such capacity and together with
any successors in such capacity,
"Administrative Agent") for the lending
institutions (the "Lenders") from time to
time party to the Credit Agreement (as
hereinafter defined).
RECITALS:
A. Pursuant to a certain credit agreement, dated as of
February 9, 2004 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the "Credit Agreement"; capitalized terms used
herein and not defined herein shall have the meanings assigned to them in the
Credit Agreement), among Borrower, PR Borrower, Centennial Communications Corp.,
a Delaware corporation ("Parent"), as a Guarantor, each of the other Guarantors,
the Lenders, Credit Suisse First Boston, as Joint Lead Arranger, Joint
Bookrunner and Administrative Agent, and Xxxxxx Brothers Inc., as Joint Lead
Arranger, Joint Bookrunner and Syndication Agent, the Lenders have agreed (i) to
make to or for the account of either Borrower a Term Loan up to an aggregate
principal amount of $600,000,000, (ii) to make to or for the account of either
Borrower certain Revolving Credit Loans up to an aggregate principal amount of
$150,000,000 and (iii) to issue certain Letters of Credit for the account of
either Borrower.
B. It is contemplated that one or more of the Pledgors
may enter into one or more Interest Rate Protection Agreements and Swap
Contracts with one or more of the Lenders or their respective Affiliates
(collectively, the "Interest Rate Agreements") fixing the interest rates with
respect to Loans under the Credit Agreement (all obligations of the Pledgors now
existing or hereafter arising under such Interest Rate Agreements, collectively,
the "Interest Rate Obligations").
C. Each Pledgor is or will be the legal and beneficial
owner of the Pledged Collateral (as hereinafter defined) to be pledged by it
hereunder.
AGREEMENT:
NOW, THEREFORE, in consideration of the foregoing premises and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Pledgors and Administrative Agent hereby agree as
follows:
SECTION 1. Pledge. As collateral security for the payment and
performance when due of all the Secured Obligations, each Pledgor hereby
pledges, assigns, transfers and grants to the Administrative Agent for its
benefit and the benefit of the Lenders and the other Creditors (the "Secured
Parties"), a continuing security interest in and to all of the right, title and
interest of such Pledgor in, to and under the personal property and fixtures,
wherever located, whether now existing or hereafter arising or acquired from
time to time (collectively, the "Pledged Collateral"), comprised of the
following (subject to Permitted Liens and Prior Liens):
(a) all "accounts", as such term is defined in the
Uniform Commercial Code as in effect from time to time in any applicable
jurisdiction, including, without limitation, Puerto Rico (the "UCC"), and in any
event including, without limitation, all health-care-insurance receivables and
all of such Pledgor's rights to payment for goods sold or leased or services
performed by such Pledgor or any other party, and all rights evidenced by an
account, contract, security agreement, chattel paper (whether tangible or
electronic), guarantee (including a letter of credit) or other evidence of
indebtedness or security together with (i) all security pledged, assigned,
hypothecated or granted to or held by such Pledgor to secure the foregoing, (ii)
general intangibles arising out of such Pledgor's rights in any goods, the sale
of which gave rise thereto, (iii) all guarantees, endorsements and
indemnifications on, or of, any of the foregoing, (iv) all powers of attorney
for the execution of any evidence of indebtedness or security or other writing
in connection therewith and (v) all evidences of the filing of financing
statements and other statements and the registration of other instruments in
connection therewith and amendments thereto, notices to other creditors or
secured parties and certificates from filing or other registration offices
(collectively, the "Receivables");
(b) all "inventory", as such term is defined in the UCC,
and in any event including, without limitation, all raw materials, work in
process, returned goods, finished goods, samples and consigned goods to the
extent of the consignee's interest therein, materials and supplies of any kind
or nature which are or might be used in connection with the manufacture,
printing, publication, packing, shipping, advertising, selling or finishing of
any such goods and all other products, goods, materials and supplies
(collectively, the "Inventory");
(c) all books, records, ledgers, printouts, file
materials and other papers containing information relating to Receivables and
any account debtors in respect thereof;
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(d) any and all sale, service, performance and equipment
or real property lease contracts (including, without limitation, all leases for
cell sites to which Pledgor is a party), agreements and grants (whether written
or oral), and any other contract (whether written or oral) between such Pledgor
and third parties, but excluding any of the foregoing (i) which would be
terminable by the counterparty thereto if such Pledgor's interest therein were
subject to the security interest created hereby and (ii) for which such Pledgor
has not received a consent from such counterparty to the grant of a security
interest therein (collectively, the "Contracts");
(e) all "equipment", as such term is defined in the UCC,
and in any event including, without limitation, all machinery, equipment, office
machinery, furniture, conveyors, tools, materials, storage and handling
equipment and all other equipment of every kind and nature owned by such Pledgor
or in which such Pledgor may have any interest (to the extent of such interest),
all modifications, alterations, repairs, substitutions, additions and accessions
thereto, all replacements and all parts therefor and together with all
substitutes for any of the foregoing, except for automotive equipment, motor
vehicles, tractors, trailers and other like property, to the extent title
thereto is governed by a certificate of title (collectively, the "Equipment");
(f) all "general intangibles", as such term is defined in
the UCC, and in any event including, without limitation, all manuals,
blueprints, know-how, warranties and records in connection with the Equipment;
all documents of title or documents representing the Inventory and all records,
files and writings with respect thereto; any and all other rights, claims and
causes of action of such Pledgor against any other Person and the benefits of
any and all collateral or other security given by any other Person in connection
therewith, including, without limitation, all rights under any Contracts; all
information, customer lists, identification of suppliers, data, plans,
blueprints, specification designs, drawings, recorded knowledge, surveys,
engineering reports, test reports, manuals, materials, standards, processing
standards, performance standards, catalogs, research data, computer and
automatic machinery software and programs and the like pertaining to operations
by such Pledgor, all field repair data, sales data and other information
relating to sales of products now or hereafter manufactured, distributed or
franchised by such Pledgor; all accounting information pertaining to such
Pledgor's operations or any of the Equipment, Inventory, Receivables or
Intangibles and all media in which or on which any of the information or
knowledge or data or records relating to such operations or any of the
Equipment, Inventory, Receivables, Contracts or Intangibles may be recorded or
stored and all computer programs used for the compilation or printout of such
information, knowledge, records or data; all rights and goodwill of such
Pledgor; all licenses, consents, permits, variances, certifications and
approvals of governmental agencies now or hereafter held by such Pledgor
pertaining to operations now or hereafter conducted by such Pledgor or assets
now or hereafter held by such Pledgor (other than FCC Licenses, as hereinafter
defined); all causes of action, claims and warranties now or hereafter owned or
acquired by such Pledgor, and any other property consisting of a general
intangible under the UCC applicable in such other location where such Pledgor
maintains its records relating to such property (collectively, the
"Intangibles");
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(g) all present and future authorizations, permits,
licenses and franchises (collectively, the "FCC Licenses") heretofore or
hereafter granted or assigned to such Pledgor by the Federal Communications
Commission (the "FCC") or any present and future authorizations, permits,
licenses and franchises (collectively, the "Governmental Licenses") heretofore
or hereafter granted or assigned to such Pledgor by any other public or
governmental agency or regulatory body for the operation or ownership of a
wireless telecommunications system; excluding, however, any such FCC Licenses or
Governmental Licenses to the extent, and only to the extent, that it is unlawful
to grant a security interest in the same, but including, to the maximum extent
permitted by law, all rights incident or appurtenant to such FCC Licenses or
Governmental Licenses (including, without limitation, the right to receive all
proceeds derived or arising from or in connection with the sale, assignment or
transfer of such FCC Licenses), whether now owned or hereafter acquired by such
Pledgor, or in which such Pledgor may now have or hereafter acquire an interest;
(h) all insurance policies held by such Pledgor or naming
such Pledgor as insured, additional insured or loss payee (including, without
limitation, casualty insurance, general liability insurance (but not director's
and officer's liability insurance or other fiduciary liability insurance),
property insurance and business interruption insurance), all such insurance
policies entered into after the date hereof other than insurance policies (or
certificates of insurance evidencing such insurance policies) relating to health
and welfare insurance and life insurance policies in which such Pledgor is not
named as beneficiary (i.e., insurance policies that are not "Key Man" insurance
policies) and all rights, claims and recoveries relating thereto (including all
dividends, returned premiums and other rights to receive money in respect of any
of the foregoing) (collectively, the "Insurance Policies");
(i) such Pledgor's right to receive the surplus funds, if
any, which are payable to such Pledgor following the termination of any employee
pension plan and the satisfaction of all liabilities of participants and
beneficiaries under such plan in accordance with applicable law (collectively,
the "Pension Plan Reversions");
(j) the issued and outstanding shares of capital stock of
each Person described in Schedule I-A hereto and each other corporation
hereafter acquired or formed by such Pledgor (the "Pledged Shares") (which are
and shall remain at all times until this Agreement terminates, certificated
shares), including the certificates representing the Pledged Shares and any
interest of such Pledgor in the entries on the books of any financial
intermediary pertaining to the Pledged Shares; provided that such Pledgor shall
not be required to pledge, and the term "Pledged Shares" shall not include, (A)
shares in Unrestricted Subsidiaries or (B) shares possessing more than 65% of
the voting power of all classes of capital stock entitled to vote of any
Subsidiary which is (i) a controlled foreign corporation (as defined in Section
957(a) of the Internal Revenue Code of 1986, as amended (the "Tax Code")) or
(ii) a domestic corporation all of the assets of which (other than de minimis
administrative assets) are stock of one or more controlled foreign corporations,
with such limitation effective beginning on the last day of the first year for
which the financial projections in effect on such date (as generally used by
management for business purposes and based on assumptions reasonably
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acceptable to the Lenders) for such domestic corporation show that any of its
controlled foreign corporation subsidiaries will have earnings and profits in
excess of $5,000 in the following year and, in any event, shall not be required
to pledge the shares of stock of any Subsidiary otherwise required to be pledged
pursuant to this Section 1(j) to the extent that such pledge would constitute an
investment of earnings in United States property under Section 956 (or a
successor provision) of the Tax Code, which investment would trigger an increase
in the gross income of a United States shareholder of such Pledgor pursuant to
Section 951 (or a successor provision) of the Tax Code; provided further, that
if following a change in the relevant sections of the Tax Code or the
regulations, rules, rulings, notices or other official pronouncements issued or
promulgated thereunder which would permit a pledge of 66-2/3% or more of the
total combined voting power of all classes of capital stock of any Foreign
Subsidiary entitled to vote without causing the undistributed earnings of such
Foreign Subsidiary as determined for United States Federal income taxes to be
treated as a deemed dividend to the Pledgors for United States Federal income
tax purposes, then the 65% limitation set forth above shall no longer be
applicable and the Pledgors shall duly pledge and deliver to the Administrative
Agent such maximum additional percentage of the capital stock not theretofore
required to be pledged hereunder as will not cause such a deemed dividend to
have been made;
(k) subject to the provisos set forth in Section 1(j)
above, all additional shares of capital stock of whatever class of any issuer of
the Pledged Shares from time to time acquired by such Pledgor in any manner
(which are and shall remain at all times until this Agreement terminates,
certificated shares) (which shares shall be deemed to be part of the Pledged
Shares), including the certificates representing such additional shares and any
interest of such Pledgor in the entries on the books of any financial
intermediary pertaining to such additional shares;
(l) all membership interests and/or partnership
interests, as applicable, of each Person described in Schedule I-B hereto and
each other limited liability company or limited partnership hereafter acquired
or formed by such Pledgor, together with all rights, privileges, authority and
powers of such Pledgor in and to each such Person or under the membership or
partnership agreement of each such Person (the "Operative Agreements")
(collectively, the "Initial Pledged Interests"), and the certificates,
instruments and agreements, if any, representing the Initial Pledged Interests;
(m) all options, warrants, rights, agreements, additional
membership or partnership interests or other interests relating to each such
Person described in Section 1(l) above or any interest in any such Person,
including, without limitation, any right relating to the equity or membership or
partnership interests in any such Person or under the Operative Agreement of any
such Person (collectively, the "Additional Interests"; together with the Initial
Pledged Interests, the "Pledged Interests"; the Pledged Interests and the
Pledged Shares, collectively, the "Pledged Securities") from time to time
acquired by such Pledgor in any manner and the certificates, instruments and
agreements, if any, representing the Additional Interests;
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(n) all intercompany notes described on Schedule II
hereto (the "Intercompany Notes") and all certificates or instruments evidencing
such Intercompany Notes and all proceeds thereof, all accessions thereto and all
substitutions therefor;
(o) all dividends, cash, options, warrants, rights,
instruments, distributions, returns of capital or principal, income, interest,
profits and other property, interests (debt or equity) or proceeds, including as
a result of a split, revision, reclassification or other like change of the
Pledged Securities, from time to time received, receivable or otherwise
distributed to such Pledgor in respect of or in exchange for any or all of the
Pledged Securities or Intercompany Notes (collectively, the "Distributions");
(p) without affecting the obligations of such Pledgor
under any provision prohibiting such action hereunder or under the Credit
Agreement, in the event of any consolidation or merger in which any Person
listed on Schedule I-A or Schedule I-B hereto is not the surviving entity, all
shares of each class of the capital stock of the successor corporation or
interests or certificates of the successor limited liability company or
partnership owned by such Pledgor (unless such successor is such Pledgor itself)
formed by or resulting from such consolidation or merger;
(q) patents issued or assigned to, and all patent
applications made by, such Pledgor, including, without limitation, the patents
and patent applications listed on Schedule III hereto, along with any and all
(i) inventions and improvements described and claimed therein, (ii) reissues,
divisions, continuations, extensions and continuations-in-part thereof, (iii)
income, royalties, damages, claims and payments now and hereafter due and/or
payable thereunder and with respect thereto, including, without limitation,
damages and payments for past or future infringements thereof and (iv) rights to
xxx for past, present and future infringements thereof (collectively, the
"Patents");
(r) trademarks (including service marks), logos, federal
and state trademark registrations and applications made by such Pledgor, common
law trademarks and trade names owned by or assigned to such Pledgor and all
registrations and applications for the foregoing, including, without limitation,
the registrations and applications listed on Schedule IV hereto, along with any
and all (i) renewals thereof, (ii) income, royalties, damages and payments now
and hereafter due and/or payable thereunder and with respect thereto, including,
without limitation, damages, claims and payments for past or future
infringements thereof and (iii) rights to xxx for past, present and future
infringements thereof (collectively, the "Trademarks");
(s) copyrights owned by or assigned to such Pledgor,
including, without limitation, the registrations and applications listed on
Schedule V hereto, along with any and all (i) renewals and extensions thereof,
(ii) income, royalties, damages, claims and payments now and hereafter due
and/or payable thereunder and with respect thereto, including, without
limitation, damages and payments for past, present or future infringements
thereof and (iii) rights to xxx for past, present and future infringements
thereof (collectively, the "Copyrights");
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(t) license agreements and covenants not to xxx with any
other party with respect to any Patent, Trademark, or Copyright listed on
Schedule VI hereto, along with any and all (i) renewals, extensions, supplements
and continuations thereof, (ii) income, royalties, damages, claims and payments
now and hereafter due and/or payable thereunder and with respect thereto,
including, without limitation, damages and payments for past, present or future
breaches thereof, (iii) rights to xxx for past, present and future breaches
thereof and (iv) any other rights to use, exploit or practice any or all of the
Patents, Trademarks or Copyrights (collectively, the "Licenses");
(u) the entire goodwill and all product lines of such
Pledgor's business and other general intangibles, including, without limitation,
know-how, trade secrets, customer lists, proprietary information, inventions,
methods, procedures and formulae connected with the use of and symbolized by the
Trademarks of such Pledgor (collectively, the "Goodwill");
(v) all "securities accounts", "commodity accounts",
"investment property" (each as defined in the UCC) and financial accounts of
such Pledgor, including, without limitation, (i) the financial accounts,
securities accounts and commodity accounts maintained with the financial
institutions, securities intermediaries and commodity intermediaries (each as
defined in the UCC and each, a "Financial Intermediary") identified on Schedule
VII hereto, (ii) all moneys, financial assets (as defined in the UCC), checks,
drafts, securities and instruments deposited or required to be deposited in such
accounts, (iii) all investments and all certificates and instruments, if any,
from time to time representing or evidencing any other property from time to
time received, receivable or otherwise distributed in respect of or in exchange
for any or all of the foregoing items listed under clauses (i) and (ii) and (iv)
each consent or other agreement from time to time entered into by such Pledgor
with any financial institution at which any of the above accounts is maintained
and all rights of such Pledgor under each such consent or agreement;
(w) all "deposit accounts", as such term is defined in
the UCC;
(x) all "documents", as such term is defined in the UCC,
including, without limitation, all receipts of such Pledgor covering, evidencing
or representing Inventory or Equipment (collectively, the "Documents");
(y) all "instruments", as such term is defined in the
UCC, including, without limitation, all promissory notes, drafts, bills of
exchange or acceptances (collectively, the "Instruments");
(z) all "commercial tort claims", as such term is defined
in the UCC. The Administrative Agent acknowledges that the attachment of its
security interest in any commercial tort claim as original collateral is subject
to the applicable Pledgor's compliance with Section 5(i) hereof;
(aa) all "letter-of-credit rights", as such term is
defined in the UCC; and
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(bb) all "proceeds", as such term is defined in the UCC or
under other relevant law, and in any event including, without limitation, any
and all (i) proceeds of any insurance (except payments made to a Person which is
not a party to this Agreement), indemnity, warranty or guaranty payable to the
Administrative Agent or to such Pledgor from time to time with respect to any of
the Pledged Collateral, (ii) payments (in any form whatsoever) made or due and
payable to such Pledgor from time to time in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the
Pledged Collateral by any federal, state, local, foreign or other governmental
or administrative (including self-regulatory) body, instrumentality, department
or agency or any court, tribunal, administrative hearing body, arbitration
panel, commission or other similar dispute-resolving body including, without
limitation, those governing the regulation and protection of the environment
(each, a "Governmental Authority") (or any person acting on behalf of a
Governmental Authority), (iii) instruments representing obligations to pay
amounts in respect of the Pledged Collateral, (iv) products of the Pledged
Collateral and (v) other amounts from time to time paid or payable under or in
connection with any of the Pledged Collateral (collectively, the "Proceeds").
Notwithstanding the foregoing, (i) to the extent that the
provisions of any agreement binding on any Pledgor that governs any personal
property referred to in any of Section 1(a) through (bb) above (including any
agreement relating to Indebtedness incurred to finance the acquisition of such
property (whether as purchase money debt, as a capital lease or otherwise))
expressly prohibits the pledge, assignment or transfer thereof, or the grant of
a security interest therein, such Pledgor's right, title and interest in such
property shall be excluded from the foregoing pledge, assignment, transfer and
grant for so long as such prohibition continues, it being understood that, upon
request of the Administrative Agent, such Pledgor will in good faith use
reasonable efforts to obtain consent for the pledge, assignment, transfer and
creation of a security interest in favor of the Administrative Agent in such
Pledgor's right, title and interest in such property; provided, however, that,
for purposes of this paragraph, "reasonable efforts" shall not include any
obligation to expend money (other than nominal amounts) or commence any action
or proceeding against any other Person; and (ii) the "Pledged Collateral" shall
not include cash pledged pursuant to Sections 9.07(z) and (aa) of the Credit
Agreement, in each case only to the extent such cash is actually pledged to
secure outstanding and unpaid obligations under the letters of credit or
Indebtedness, as the case may be, secured thereby.
The Pledged Securities, the Intercompany Notes, the
Distributions and the Proceeds relating thereto are collectively referred to as
the "Securities Collateral". The Patents, Trademarks, Copyrights, Licenses,
Goodwill and the Proceeds relating thereto are collectively referred to as the
"Intellectual Property Collateral". The property described in Section 1(v) above
and the Proceeds relating thereto are collectively referred to as the "Financial
Account Collateral". Any account containing Financial Account Collateral shall
be referred to as a "financial account"; provided that "financial account" shall
not include any "deposit account" (as defined in the UCC). The Pledged
Collateral other than the Securities Collateral, the Intellectual Property
Collateral and the Financial Account Collateral is collectively referred to as
the "General Collateral".
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SECTION 2. Secured Obligations. This Agreement secures, and
the Pledged Collateral is collateral security for, the payment and performance
in full when due, whether at stated maturity, by acceleration or otherwise
(including, without limitation, the payment of interest and other amounts which
would accrue and become due but for the filing of a petition in bankruptcy or
the operation of the automatic stay under Section 362(a) of the Bankruptcy Code,
11 U.S.C. Section 362(a)), of (i) all Obligations of the Pledgors now existing
or hereafter arising under or in respect of the Credit Agreement and all
Interest Rate Obligations of the Pledgors now existing or hereafter arising
under or in respect of any Interest Rate Agreement (including, without
limitation, the obligations of the Pledgors to pay principal, interest and all
other charges, fees, expenses, commissions, reimbursements, premiums,
indemnities and other payments related to or in respect of the Obligations
contained in the Credit Agreement and the obligations contained in any Interest
Rate Agreement), and (ii) without duplication of the amounts described in clause
(i), all obligations of the Pledgors now existing or hereafter arising under or
in respect of this Agreement or any other Credit Document, including, without
limitation, all charges, fees, expenses, commissions, reimbursements, premiums,
indemnities and other payments related to or in respect of the obligations
contained in this Agreement or in any other Credit Document, in each case
whether in the regular course of business or otherwise (the obligations
described in clauses (i) and (ii), collectively, the "Secured Obligations").
SECTION 3. FCC Approvals and Municipal Approvals. The
provisions of this Agreement shall be subject to this Section 3. The rights of
the Administrative Agent and the Secured Parties under this Agreement are
subject to all applicable rules and regulations of the FCC. Notwithstanding
anything to the contrary contained herein, neither the Administrative Agent nor
any Secured Party will take any action pursuant to this Agreement which would
constitute or result in any assignment of any FCC License or any direct or
indirect change of control of Borrower or any other Pledgor, any FCC License or
any Government License, whether de jure or de facto, if such assignment or
change of control would require the prior approval of the FCC under the
Communications Act of 1934, as amended (including the written rules and
regulations promulgated by the FCC with respect thereto) or any other
Governmental Authority unless and until each such approval has been obtained.
During any time when an Event of Default shall have occurred and be continuing,
Borrower and each other Pledgor agrees to take any action which the
Administrative Agent may reasonably request in order to obtain and enjoy to the
fullest possible extent the rights and benefits granted to the Administrative
Agent and the Secured Parties by this Agreement and each other agreement,
instrument and document delivered to the Administrative Agent for the benefit of
the Secured Parties in connection herewith or in any document evidencing or
securing any of the Pledged Collateral, including specifically, at the cost and
expense of such Pledgor, the use of such Pledgor's reasonable best efforts to
assist in obtaining approval of the FCC or any other Governmental Authority for
any action or transaction contemplated by, and consistent with the terms of,
this Agreement which is then required by law, and specifically, without
limitation, upon request, to prepare, sign and file (or cause to be filed) with
the FCC or any other Governmental Authority the assignor's or transferor's
portion of any application or applications for consent to the assignment of any
license, permit or franchise or change of control necessary or appropriate under
the
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rules and regulations of the FCC or any Governmental Authority for approval of
(a) the assignment of any FCC license or transfer of control thereof or of such
Pledgor, (b) any sale or sales of property constituting Pledged Collateral by
the Administrative Agent or (c) any assumption by the Administrative Agent or
the Secured Parties of voting rights or management rights in property
constituting Pledged Collateral which are being effected in accordance with the
terms of this Agreement. Furthermore, notwithstanding anything to the contrary
contained in this Agreement, the Administrative Agent agrees on behalf of the
Secured Parties that (aa) voting rights in any Pledged Securities shall remain
with the issuer thereof even upon an Event of Default unless all required prior
approvals of the FCC to the transfer of such voting rights shall have been
obtained and (bb) upon an Event of Default, and only if so permitted by this
Agreement, the Administrative Agent or the Secured Parties may dispose of such
Pledged Securities, but only after all consents required by the FCC or any other
Governmental Authority with respect to such sale have been obtained.
SECTION 4. No Release. Nothing set forth in this Agreement
shall relieve any Pledgor from the performance of any term, covenant, condition
or agreement on such Pledgor's part to be performed or observed under or in
respect of any of the Pledged Collateral or from any liability to any Person
under or in respect of any of the Pledged Collateral or shall impose any
obligation on the Administrative Agent or any Secured Party to perform or
observe any such term, covenant, condition or agreement on such Pledgor's part
to be so performed or observed or shall impose any liability on the
Administrative Agent or any Secured Party for any act or omission on the part of
such Pledgor relating thereto or for any breach of any representation or
warranty on the part of such Pledgor contained in this Agreement, any Interest
Rate Agreement or any other Credit Document, or under or in respect of the
Pledged Collateral or made in connection herewith or therewith. The obligations
of each Pledgor contained in this Section 4 shall survive the termination of
this Agreement and the discharge of such Pledgor's other obligations under this
Agreement, any Interest Rate Agreement and the other Credit Documents.
SECTION 5. Perfection; Supplements; Further Assurances; Use of
Pledged Collateral. (a) Delivery of Certificated Securities Collateral. Subject
to the limitations set forth in Section 8(a), all certificates, agreements or
instruments representing or evidencing the Securities Collateral shall promptly
upon receipt thereof by any Pledgor be delivered to and held by or on behalf of
the Administrative Agent pursuant hereto. All certificated Securities Collateral
shall be in suitable form for transfer by delivery or shall be accompanied by
duly executed instruments of transfer or assignment in blank, all in form and
substance reasonably satisfactory to the Administrative Agent. The
Administrative Agent shall have the right, at any time upon the occurrence and
during the continuance of any Event of Default and without notice to any
Pledgor, to endorse, assign or otherwise transfer to or to register in the name
of the Administrative Agent or any of its nominees or endorse for negotiation
any or all of the Securities Collateral, without any indication that such
Securities Collateral is subject to the security interest hereunder. In
addition, at any time during which an Event of Default has occurred and is
continuing, the Administrative Agent shall have the right at any time to
exchange certificates representing or evidencing Pledged Securities for
certificates of
10
smaller or larger denominations.
(b) Perfection of Uncertificated Securities Collateral.
If any Pledged Securities constitute "uncertificated securities" (as defined in
the UCC), then each applicable Pledgor shall, to the extent required by
applicable law to perfect, continue and maintain a valid, enforceable, first
priority security interest in the Pledged Securities, record such pledge on the
equity holder register or the books of the issuer, cause the issuer to execute
and deliver to the Administrative Agent an acknowledgment of the pledge of such
Pledged Securities substantially in the form of Exhibit 1 hereto, execute any
customary pledge forms or other documents necessary or appropriate to complete
the pledge and give the Administrative Agent the right to transfer such Pledged
Securities under the terms hereof and, to the extent provided in the Credit
Agreement, provide to the Administrative Agent an opinion of counsel, in form
and substance satisfactory to the Administrative Agent, as to the perfection of
such pledge.
(c) Financing Statements and Other Filings. (i) Each
Pledgor agrees that at any time and from time to time it will, at the sole cost
and expense of the Pledgors, file and refile, or authorize the Administrative
Agent to file and refile, such financing statements, continuation statements and
other documents (including, without limitation, this Agreement), in form
acceptable to the Administrative Agent, in such offices (including, without
limitation, the United States Patent and Trademark Office and the United States
Copyright Office) as the Administrative Agent may reasonably deem necessary or
appropriate, wherever required or permitted by law in order to perfect, continue
and maintain a valid, enforceable, first priority security interest in the
Pledged Collateral as provided herein and to preserve the other rights and
interests granted to the Administrative Agent hereunder, as against third
parties, with respect to any Pledged Collateral. Each Pledgor authorizes the
Administrative Agent to file any such financing or continuation statement or
other document without the signature of such Pledgor where permitted by law.
(ii) Each Pledgor irrevocably authorizes the
Administrative Agent at any time and from time to time to file in any
jurisdiction in which the UCC has been adopted any initial financing statements
and amendments thereto that (A) indicate the Pledged Collateral (I) as all
assets of such Pledgor or words of similar effect, regardless of whether any
particular asset comprised in the Collateral falls within the scope of Article 9
of the UCC, or (II) as being of an equal or lesser scope or with greater detail,
and (B) contain any other information required by part 5 of Article 9 of the UCC
for the sufficiency or filing office acceptance of any initial financing
statement or amendment, including (I) whether such Pledgor is an organization,
the type of organization and any organization identification number issued to
such Pledgor and (II) in the case of a financing statement filed as a fixture
filing, a sufficient description of real property to which such Pledged
Collateral relates. Each Pledgor agrees to furnish any such information to the
Administrative Agent promptly upon request. Each Pledgor also ratifies its
authorization for the Administrative Agent to have filed in any UCC jurisdiction
any like initial financing statements or amendments thereto if filed prior to
the date hereof.
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(d) Perfection in Financial Accounts and Deposit
Accounts. In addition to any other actions required herein to be taken by any
Pledgor, each applicable Pledgor shall take the steps required by Section 10
with respect to all deposit and financial accounts maintained by such Pledgor.
(e) Use and Pledge of Pledged Collateral. Unless an Event
of Default shall have occurred and be continuing, the Administrative Agent shall
from time to time execute and deliver, upon written request of any Pledgor and
at the sole cost and expense of the Pledgors, any and all instruments,
certificates or other documents, in a form reasonably requested by such Pledgor,
necessary or appropriate in the reasonable judgment of such Pledgor to enable
such Pledgor to continue to exploit, license, use, enjoy and protect the Pledged
Collateral in accordance with the terms of this Agreement. The Pledgors and the
Administrative Agent acknowledge that this Agreement is intended to grant to the
Administrative Agent for the benefit of the Secured Parties a security interest
in and Lien upon the Pledged Collateral and shall not constitute or create a
present assignment of any of the Pledged Collateral.
(f) Pledged Collateral in the Possession of a Bailee. If
any goods in an amount in excess of $3,000,000 in the aggregate are at any one
time in the possession of a bailee, the applicable Pledgor shall promptly notify
the Administrative Agent thereof and, if requested by the Administrative Agent,
shall promptly obtain an acknowledgement from such bailee, in form and substance
satisfactory to the Administrative Agent, that such bailee holds such Pledged
Collateral for the benefit of the Administrative Agent and shall act upon the
instructions of the Administrative Agent, without the further consent of the
Pledgor.
(g) Electronic Chattel Paper. If any Pledgor at any time
holds or acquires an interest in any electronic chattel paper in an amount in
excess of $3,000,000, such Pledgor shall promptly notify the Administrative
Agent thereof and, at the request of the Administrative Agent, shall take such
action as the Administrative Agent may reasonably request to vest in the
Administrative Agent control, under Section 9-105 of the UCC, of such electronic
chattel paper.
(h) Letter of Credit Rights. If any Pledgor is at any one
time a beneficiary under one or more letters of credit in an amount in excess of
$3,000,000 in the aggregate now or hereafter issued in favor of such Pledgor,
such Pledgor shall promptly notify the Administrative Agent thereof and, at the
reasonable request and option of the Administrative Agent, such Pledgor shall
either (i) arrange for the issuer and any nominated person with respect to such
letter of credit to consent, pursuant to an agreement or other authenticated
record with and in form and substance satisfactory to the Administrative Agent,
to an assignment to the Administrative Agent of the proceeds of any drawing
under the letter of credit or (ii) arrange for the Administrative Agent to
become the transferee beneficiary of the letter of credit.
(i) Commercial Tort Claims. If any Pledgor shall at any
time hold or acquire a commercial tort claim in an amount in excess of
$3,000,000, such Pledgor shall promptly notify the Administrative Agent in a
writing signed by such Pledgor of
12
the brief details thereof and grant to the Administrative 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 satisfactory to
the Administrative Agent.
(j) Supplements; Further Assurances. Each Pledgor agrees to do
such further acts and things, and to execute and deliver to the Administrative
Agent such additional assignments, agreements, supplements, powers and
instruments, as the Administrative Agent may reasonably deem necessary or
appropriate, wherever required or permitted by law, in order to perfect,
preserve and protect the security interest in the Pledged Collateral as provided
herein and the rights and interests granted to the Administrative Agent
hereunder, to carry into effect the purposes of this Agreement or better to
assure and confirm unto the Administrative Agent or permit the Administrative
Agent to exercise and enforce its respective rights, powers and remedies
hereunder with respect to any Pledged Collateral. Without limiting the
foregoing, each Pledgor shall make, execute, endorse, acknowledge, file or
refile and/or deliver to the Administrative Agent from time to time such lists,
descriptions and designations of the Pledged Collateral, copies of warehouse
receipts, receipts in the nature of warehouse receipts, bills of lading,
documents of title, vouchers, invoices, schedules, confirmatory assignments,
supplements, additional security agreements, conveyances, financing statements,
transfer endorsements, powers of attorney, certificates, reports and other
assurances or instruments, as the Administrative Agent shall reasonably request.
At any time during which an Event of Default has occurred and is continuing, the
Administrative Agent may institute and maintain, in its own name or in the name
of any Pledgor, such suits and proceedings as the Administrative Agent may be
advised by counsel shall be reasonably necessary or expedient to prevent any
impairment of the security interest in or perfection of the Pledged Collateral.
All of the foregoing shall be at the sole cost and expense of the Pledgors.
Notwithstanding the foregoing, (i) the actions required to be taken in Sections
5(f) through (i) shall only be required to be taken in the event the Pledged
Collateral of the type described therein exceeds the monetary thresholds therein
and (ii) Administrative Agent agrees that this Section 5(j) shall not require
any Pledgor to certificate any Pledged Securities that are not certificated or
represented by an instrument on the Closing Date.
SECTION 6. Representations, Warranties and Covenants. Each
Pledgor represents, warrants and covenants as follows:
(a) Perfection Actions; Prior Liens. Upon the completion of
the deliveries, filings and other actions contemplated in Section 5 hereof (to
the extent such deliveries, filings and other actions are required to be taken
pursuant to Section 5), the security interest granted to the Administrative
Agent for the benefit of the Secured Parties pursuant to this Agreement in and
to the Pledged Collateral will constitute a perfected security interest therein
(to the extent that the actions required by Section 5 are sufficient under the
UCC and applicable law to perfect the security interest granted hereby with
respect to such Pledged Collateral), superior and prior to the rights of all
other Persons therein other than with respect to the Liens identified on Annex
A-1 hereto relating to the items of Pledged Collateral identified thereon (the
"Prior Liens") and Permitted Liens.
13
(b) No Liens. Such Pledgor does as of the date hereof and, as
to Pledged Collateral acquired by it from time to time after the date hereof,
such Pledgor shall have, all rights under applicable law, including the UCC,
with respect to the Pledged Collateral necessary in order to pledge such Pledged
Collateral as provided hereunder, and all such Pledged Collateral is or will be
at the time pledged hereunder free from any Lien or other right, title or
interest of any Person, other than Prior Liens and Permitted Liens, and such
Pledgor shall defend the Pledged Collateral pledged by it hereunder against all
claims and demands of all Persons at any time claiming any interest therein
adverse to the Administrative Agent or any Secured Party other than the holders
of such Liens. There is no agreement, and no Pledgor shall enter into any
agreement or take any other action, that would result in the imposition of any
other Lien, restrict the transferability of any of the Pledged Collateral or
otherwise impair or conflict with such Pledgors' obligations or the rights of
the Administrative Agent hereunder except to the extent permitted by Credit
Documents and with respect to restrictions that are not enforceable under the
UCC or other applicable law.
(c) Other Financing Statements. There is no financing
statement (or similar statement or instrument of registration under the law of
any jurisdiction) covering or purporting to cover any interest of any kind in
the Pledged Collateral other than financing statements relating to Prior Liens
and Permitted Liens, and so long as any of the Secured Obligations remain unpaid
or the Commitments of the Lenders to make any Loan or to issue any Letter of
Credit shall not have expired or been sooner terminated, no Pledgor shall
execute, authorize or permit to be filed in any public office any financing
statement (or similar statement or instrument of registration under the law of
any jurisdiction) or statements relating to any Pledged Collateral, except, in
each case, financing statements filed or to be filed in respect of and covering
the security interests granted by such Pledgor pursuant to this Agreement and
financing statements relating to Prior Liens and Permitted Liens.
(d) Legal Status; Legal Name; Locations; Chief Executive
Office. The perfection certificate (in the form attached as Exhibit L to the
Credit Agreement, as such certificate is updated from time to time pursuant to
Section 6(q), the "Perfection Certificate") (i) sets forth each Pledgor's
organizational identification number or Federal tax identification number or
states that such Pledgor has none, (ii) sets forth the type and jurisdiction of
organization of each Pledgor, (iii) sets forth the exact legal name of each
Pledgor and (iv) sets forth each Pledgor's chief executive office, as well as
its mailing address if different, in each case except to the extent such
information has been provided to the Administrative Agent pursuant to Section
9.12 of the Credit Agreement prior to the delivery of any updated Perfection
Certificate. Each Pledgor is incorporated in a jurisdiction that has adopted the
UCC.
(e) Due Authorization and Issuance. All of the Pledged Shares
have been, and to the extent hereafter issued will be upon such issuance, duly
authorized, validly issued and fully paid and nonassessable. All of the Initial
Pledged Interests have been fully paid for, and there is no amount or other
obligation due and owing by any Pledgor to any issuer of the Initial Pledged
Interests in exchange for or in connection
14
with the issuance of the Initial Pledged Interests or any Pledgor's status as a
partner or a member of any issuer of the Initial Pledged Interests.
(f) No Violations, etc. The pledge of the Pledged Securities
pursuant to this Agreement does not violate Regulation T, U or X promulgated by
the Board of Governors of the Federal Reserve Board.
(g) No Options, Warrants, etc. Except for restrictions and
limitations permitted by the Credit Documents or imposed by securities laws
generally, the Pledged Securities are and will continue to be freely
transferable and assignable, and none of the Pledged Securities are or will be
subject to any option, right of first refusal, shareholders agreement, charter
or by-law provisions or contractual restriction of any nature that might
prohibit, impair, delay or otherwise affect the pledge of such Pledged
Securities hereunder, the sale or disposition thereof pursuant hereto or the
exercise by the Administrative Agent of rights and remedies hereunder.
(h) No Claims. Each Pledgor has good and valid rights in the
Pledged Collateral with respect to which it has purported to grant a security
interest hereunder and has full power and authority to grant to the
Administrative Agent the security interest in such Pledged Collateral (except
Intellectual Property) pursuant hereto. The use by such Pledgor of such Pledged
Collateral and all such rights with respect to the foregoing do not materially
infringe on the rights of any Person. No claim has been made and remains
outstanding that such Pledgor's use of any Pledged Collateral (except
Intellectual Property) does or may materially violate the rights of any third
person.
(i) Authorization, Enforceability. Such Pledgor has the
requisite organizational power, authority and legal right to pledge and grant a
security interest in all the Pledged Collateral pledged by it pursuant to this
Agreement, and each other Credit Document to which such Pledgor is, or is
specified to be, a party constitutes the legal, valid and binding obligation of
such Pledgor, enforceable against such Pledgor in accordance with its terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting creditors'
rights generally or by equitable principles relating to enforceability.
(j) No Conflicts, Consents, etc. Neither the execution and
delivery of this Agreement or any other Credit Document to which such Pledgor is
a party by such Pledgor nor the consummation of the transactions herein or
therein contemplated nor the fulfillment of the terms hereof or thereof (i)
violates any charter or by-laws or other organizational document of such Pledgor
or any issuer of Pledged Securities, (ii) violates the terms of any agreement,
indenture, mortgage, deed of trust, equipment lease, instrument or other
document to which such Pledgor is a party, or by which it may be bound or to
which any of its properties or assets may be subject, (iii) conflicts with any
law, order, rule or regulation applicable to any such Pledgor of any
Governmental Authority having jurisdiction over such Pledgor or its property or
(iv) results in or requires the creation or imposition of any Lien (other than
the Lien contemplated hereby) upon or with respect to any of the property now
owned or hereafter acquired by such Pledgor, except with respect to each of the
foregoing which is not reasonably likely
15
to have a Material Adverse Effect, a material adverse effect on the value of the
Pledged Collateral taken as a whole or an adverse effect on the security
interests hereunder taken as a whole. No consent of any party (including,
without limitation, equityholders or creditors of such Pledgor or any account
debtor under a Receivable) and no consent, authorization, approval, license or
other action by, and no notice to or filing with, any Governmental Authority or
regulatory body or other Person is required for (x) the pledge by such Pledgor
of the Pledged Collateral pledged by it pursuant to this Agreement or for the
execution, delivery or performance of this Agreement by such Pledgor, (y) except
as expressly recognized in Section 3 hereof, the exercise by the Administrative
Agent of the rights provided for in this Agreement or (z) except as expressly
recognized in Section 3 hereof, the exercise by the Administrative Agent of the
remedies in respect of the Pledged Collateral pursuant to this Agreement.
(k) Pledged Collateral. All information set forth herein,
including the schedules and annexes attached hereto, and all information
contained in any documents, schedules and lists heretofore delivered to any
Secured Party in connection with this Agreement, in each case, relating to the
Pledged Collateral, is accurate and complete in all material respects. As of the
date hereof, the Pledged Collateral described on the schedules attached hereto
constitutes all of the property of such type of Pledged Collateral required to
be pledged hereunder.
(l) Insurance. No Pledgor shall take any action that impairs
the rights of the Administrative Agent or any Secured Party in the Pledged
Collateral. The Pledgors, at their own expense, shall maintain or cause to be
maintained insurance covering physical loss or damage to the Inventory and
Equipment in accordance with the requirements set forth in Section 9.04 of the
Credit Agreement. Each Pledgor irrevocably makes, constitutes and appoints the
Administrative Agent (and all officers, employees or agents designated by the
Administrative Agent) as such Pledgor's true and lawful agent (and
attorney-in-fact) for the purpose, during the continuance of an Event of
Default, of making, settling and adjusting claims in respect of Pledged
Collateral under policies of insurance, endorsing the name of such Pledgor on
any check, draft, instrument or other item of payment for the proceeds of such
policies of insurance and for making all determinations and decisions with
respect thereto. In the event that any Pledgor at any time or times shall fail
to obtain or maintain any of the policies of insurance required hereby or to pay
any premium in whole or part relating thereto, the Administrative Agent may,
without waiving or releasing any obligation or liability of the Pledgors
hereunder or any Event of Default, in its sole discretion, obtain and maintain
such policies of insurance and pay such premium and take any other actions with
respect thereto as the Administrative Agent deems advisable; provided, however,
that the Administrative Agent shall be required to provide the applicable
Pledgor with not less than five (5) Business Days' notice of its intent to take
any such actions at any time when no other Default has occurred and is
continuing. All sums disbursed by the Administrative Agent in connection with
this paragraph, including reasonable attorneys' fees, court costs, expenses and
other charges relating thereto, shall be payable, upon demand, by the Pledgors
to the Administrative Agent and shall be additional Secured Obligations.
16
(m) Insurance Proceeds. Any proceeds of insurance received by
any Pledgor shall be applied by it as provided in Section 2.10(a)(i) of the
Credit Agreement. In the event that any Pledgor is permitted to and elects to
apply such proceeds to the repair or replacement of any item of Pledged
Collateral, such Pledgor shall upon its receipt of such proceeds from the
Administrative Agent promptly commence and diligently continue to perform such
repair or promptly effect such replacement. Upon the occurrence and during the
continuance of any Event of Default, the Administrative Agent shall have the
option to apply any proceeds of insurance received by any Pledgor in respect of
the Pledged Collateral toward the payment of the Secured Obligations in
accordance with Section 14 hereof or to continue to hold such proceeds as
additional collateral to secure the performance by the Pledgors of the Secured
Obligations.
(n) Payment of Taxes; Compliance with Laws; Claims. At its
option, the Administrative Agent may discharge past due taxes, assessments,
charges, fees, Liens, security interests or other encumbrances at any time
levied or placed on the Pledged Collateral and not permitted pursuant to Section
9.07 of the Credit Agreement, and may pay for the maintenance and preservation
of the Pledged Collateral to the extent any Pledgor fails to do so as required
by the Credit Agreement or this Agreement, and each Pledgor jointly and
severally agrees to reimburse the Administrative Agent on demand for any payment
made or any expense incurred by the Administrative Agent pursuant to the
foregoing authorization; provided; however, that the Administrative Agent shall
be required to provide the applicable Pledgor with not less than five (5)
Business Days' notice of its intent to take any such actions at any time when no
other Default has occurred and is continuing; provided, however, that nothing in
this paragraph shall be interpreted as excusing any Pledgor from the performance
of, or imposing any obligation on the Administrative Agent or any Credit Party
to cure or perform, any covenants or other promises of any Pledgor with respect
to taxes, assessments, charges, fees, Liens, security interests or other
encumbrances and maintenance as set forth herein or in the other Credit
Documents.
(o) Inspection and Verification. The Administrative Agent, and
such persons the Administrative Agent may reasonably designate, shall have full
and free access during normal business hours to all of the books, correspondence
and records of such Pledgor relating to the Pledged Collateral (including the
premises upon which any of the Pledged Collateral is located) as provided in
Section 9.03 of the Credit Agreement.
(p) Perfection Certificate. The representations and warranties
set forth in this Agreement relating to the information contained in the
Perfection Certificate shall be true, correct and complete in all respects at
the time made.
(q) Periodic Certification. Upon the request of the
Administrative Agent, but no more than once every 18 months, the Pledgor shall
deliver to the Administrative Agent a supplemental perfection certificate (each,
a "Perfection Supplement") executed by the Pledgors setting forth the
information required pursuant to the Perfection Certificate or confirming that
there has been no change in such information since the date of such certificate
or the date of the most recent Perfection
17
Supplement delivered pursuant to this Section 6(q). Notwithstanding the
foregoing, upon the occurrence of an Event of Default, the Pledgors shall
deliver to the Administrative Agent a Perfection Supplement at any time that a
Perfection Supplement is reasonably requested by the Administrative Agent.
SECTION 7. Special Provisions Concerning General Collateral.
(a) Maintenance of Records. Each Pledgor shall keep and
maintain at its own cost and expense complete records of each Receivable in a
manner consistent with prudent business practice, including, without limitation,
records of all payments received, all credits granted thereon, all merchandise
returned and all other documentation relating thereto. Each Pledgor shall, at
such Pledgor's sole cost and expense, upon the Administrative Agent's demand
made at any time after the occurrence and during the continuance of any Event of
Default, deliver all tangible evidence of Receivables, including, without
limitation, all documents evidencing Receivables and any books and records
relating thereto to the Administrative Agent (copies of which evidence and books
and records may be retained by such Pledgor). Upon the occurrence and during the
continuance of any Event of Default, the Administrative Agent may transfer a
full and complete copy of any Pledgor's books, records, credit information,
reports, memoranda and all other writings relating to the Receivables to and for
the use by any Person that has acquired or is contemplating acquisition of an
interest in the Receivables or the Administrative Agent's security interest
therein without the consent of any Pledgor.
(b) Legend. Each Pledgor shall legend in form and manner
satisfactory to the Administrative Agent, at the request of the Administrative
Agent made at any time after the occurrence and during the continuance of any
Event of Default, the Receivables and the other books, records and documents of
such Pledgor evidencing or pertaining to the Receivables with an appropriate
reference to the fact that the Receivables have been assigned to the
Administrative Agent for the benefit of the Secured Parties and that the
Administrative Agent has a security interest therein.
(c) Instruments. Each Pledgor shall deliver to the
Administrative Agent, within five days after receipt thereof by such Pledgor,
any Instrument evidencing Receivables which is in the principal amount of
$3,000,000 or more. Any Instrument delivered to the Administrative Agent
pursuant to this Section 7(c) shall be appropriately endorsed (if applicable) to
the order of the Administrative Agent, as agent for the Secured Parties, and
shall be held by the Administrative Agent as further security hereunder;
provided, however, that so long as no Default shall have occurred and be
continuing, the Administrative Agent shall, promptly upon request of such
Pledgor, make appropriate arrangements for making any Instrument pledged by such
Pledgor available to such Pledgor for purposes of presentation, collection or
renewal (any such arrangement to be effected, to the extent deemed appropriate
by the Administrative Agent, against trust receipt or like document).
(d) Cash Collateral. Upon the occurrence and during the
continuance of any Event of Default, if the Administrative Agent so directs,
each Pledgor shall cause
18
all payments on account of the Receivables to be held by the Administrative
Agent as cash collateral in accordance with subsection 10(e) hereof. Without
notice to or assent by any Pledgor, the Administrative Agent may apply any or
all amounts then or thereafter held as cash collateral in the manner provided in
Section 14 hereof. The costs and expenses (including, without limitation,
reasonable attorneys' fees) of collection, whether incurred by the
Administrative Agent or any Secured Party, shall be paid by the Pledgors.
(e) Warehouse Receipts Non-Negotiable. If any warehouse
receipt or receipt in the nature of a warehouse receipt is issued with respect
to any of the Inventory, the applicable Pledgor shall not permit such warehouse
receipt or receipt in the nature thereof to be "negotiable" (as such term is
used in Section 7-104 of the UCC or under other relevant law).
(f) Consents to Assignment of Contracts. To the extent that
any contract or other agreement of any Pledgor filed by Parent with the
Commission would constitute a Contract hereunder but for the exclusions
contained in Sections 1(d)(i) and 1(d)(ii), such Pledgor shall in good faith use
its reasonable efforts to cause the counterparty thereto to deliver the consent
contemplated in Section 1(d)(ii); provided, however, that, for purposes of this
Section 7(f), "reasonable efforts" shall not include any requirement of any
Pledgor to expend money (other than nominal amounts) or commence any proceeding.
(g) Fair Labor Standards Act. Any goods now or hereafter
produced by each Pledgor included in the Pledged Collateral have been and will
be produced in material compliance with the requirements of the Fair Labor
Standards Act of 1938, as amended.
SECTION 8. Special Provisions Concerning Securities
Collateral. (a) Pledge of Additional Securities. Each Pledgor shall, upon
obtaining any certificated Pledged Securities or Intercompany Notes of any
Person, in each case in excess of $3,000,000, deliver to the Administrative
Agent a pledge amendment, duly executed by such Pledgor, in substantially the
form of Exhibit 3 hereto (each, a "Pledge Amendment"), and the certificates and
other documents required under Sections 5(a) and 5(b) hereof in respect of the
additional Pledged Securities or Intercompany Notes which are to be pledged
pursuant to this Agreement, and confirming the attachment of the Lien hereby
created on and in respect of such additional property. Each Pledgor hereby
authorizes the Administrative Agent to attach each Pledge Amendment to this
Agreement and agrees that all Pledged Securities or Intercompany Notes listed on
any Pledge Amendment delivered to the Administrative Agent shall for all
purposes hereunder be considered Pledged Collateral.
(b) Voting Rights; Distributions; etc. (i) So long as no Event
of Default shall have occurred and be continuing:
(A) each Pledgor shall be entitled to exercise any and all
voting and other consensual rights pertaining to the Securities
Collateral or any part thereof
19
for any purpose not inconsistent with the terms or purposes of this
Agreement or any other Credit Document;
(B) each Pledgor shall be entitled to receive and retain, and
to utilize free and clear of the Lien granted to the Administrative
Agent on behalf of the Secured Parties pursuant to this Agreement, any
and all Distributions, but only if and to the extent made in accordance
with the provisions of the Credit Agreement; provided, however, that,
except as otherwise permitted under the Credit Agreement, any and all
such Distributions consisting of rights or interests in the form of
securities shall be forthwith delivered to the Administrative Agent to
hold as Pledged Collateral and shall, if received by any Pledgor and be
forthwith delivered to the Administrative Agent as Pledged Collateral
in the same form as so received (with any necessary endorsement);
(C) the Administrative Agent shall be deemed without further
action or formality to have granted to each Pledgor all necessary
consents relating to voting rights and shall, if necessary, upon
written request of any Pledgor and at the sole cost and expense of the
Pledgors, from time to time execute and deliver (or cause to be
executed and delivered) to such Pledgor all such instruments as such
Pledgor may reasonably request in order to permit such Pledgor to
exercise the voting and other rights which it is entitled to exercise
pursuant to Section 8(b)(i)(A) hereof and to receive the Distributions
which it is authorized to receive and retain pursuant to Section
8(b)(i)(B) hereof;
(ii) Upon the occurrence and during the continuance of any
Event of Default and except as expressly recognized in Section 3 hereof:
(A) all rights of each Pledgor to exercise the voting and
other consensual rights it would otherwise be entitled to exercise
pursuant to Section 8(b)(i)(A) hereof shall, upon notice from the
Administrative Agent, cease, and all such rights shall thereupon become
vested in the Administrative Agent, which shall thereupon have the sole
right to exercise such voting and other consensual rights;
(B) all rights of each Pledgor to receive Distributions which
it would otherwise be authorized to receive and retain pursuant to
Section 8(b)(i)(B) hereof shall cease and all such rights shall
thereupon become vested in the Administrative Agent, which shall
thereupon have the sole right to receive and hold as Pledged Collateral
such Distributions.
(iii) Each Pledgor shall, at its sole cost and expense, from
time to time execute and deliver to the Administrative Agent appropriate
instruments as the Administrative Agent may reasonably request in order to
permit the Administrative Agent to exercise the voting and other rights which it
may be entitled to exercise pursuant to Section 8(b)(ii)(A) hereof and to
receive all Distributions which it may be entitled to receive under Section
8(b)(ii)(B) hereof.
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(iv) All Distributions which are received by any Pledgor
contrary to the provisions of Section 8(b)(ii)(B) hereof shall be received in
trust for the benefit of the Administrative Agent, shall be segregated from
other funds of such Pledgor and shall promptly be paid over to the
Administrative Agent as Pledged Collateral in the same form as so received (with
any necessary endorsement).
(c) No New Securities. Except as permitted pursuant to the
Credit Agreement, each Pledgor shall cause each issuer of the Pledged Securities
not to issue any stock or other securities or equity interests in addition to or
in substitution for the Pledged Securities issued by such issuer, except to a
Pledgor.
(d) Defaults, etc. As of the date hereof, to the best
knowledge of such Pledgor, no Pledged Securities pledged by such Pledgor is
subject to any defense, offset or counterclaim, nor have any of the foregoing
been asserted or alleged against such Pledgor by any Person with respect
thereto, and as of the date hereof, there are no certificates or instruments
(other than the Operative Agreements, certificates and instruments, if any,
delivered to the Administrative Agent and certificates representing Equity
Interests in the Foreign Subsidiaries set forth on Schedule 9.26 to the Credit
Agreement) which evidence any Pledged Securities of such Debtor.
SECTION 9. Special Provisions Concerning Intellectual Property
Collateral. (a) Grant of License. For the purpose of enabling the Administrative
Agent, during the continuance of an Event of Default, to exercise rights and
remedies under this Agreement at such time as the Administrative Agent shall be
lawfully entitled to exercise such rights and remedies, and for no other
purpose, each Pledgor hereby grants to the Administrative Agent, to the extent
assignable, an irrevocable, non-exclusive license (exercisable without payment
of royalty or other compensation to such Pledgor) to use, assign, license or
sublicense any of the Intellectual Property Collateral now owned or hereafter
acquired by such Pledgor, wherever the same may be located, including in such
license reasonable access to all media in which any of the licensed items may be
recorded or stored and to all computer programs used for the compilation or
printout hereof.
(b) Registrations. Except pursuant to licenses and other user
agreements entered into by any Pledgor in the ordinary course of business that
are listed in Schedule VI hereto, (i) on and as of the date hereof each Pledgor
owns and possesses the right to use each, and has done nothing to authorize or
enable any other Person to use any, Copyright, Patent or Trademark listed in
said Schedules III, IV and V and (ii) as of the Closing Date, to the knowledge
of such Pledgor, such registration listed in said Schedules III, IV and V is
valid and in full force and effect.
(c) No Violations or Proceedings. On and as of the date
hereof, (i) to each Pledgor's knowledge, except as set forth in Schedule VI
hereto, there is no violation by others of any right of such Pledgor with
respect to any Copyright, Patent or Trademark listed in Schedules III, IV and V
hereto, respectively, and pledged by it under the name of such Pledgor, (ii) to
the knowledge of such Pledgor, such Pledgor is not infringing in any material
respect upon any Copyright, Patent or Trademark of any other Person and (iii) no
proceedings have been instituted or are pending or, to the
21
knowledge of such Pledgor, are threatened against such Pledgor or, to such
Pledgor's knowledge, threatened, and no claim against such Pledgor has been
received by such Pledgor alleging any such violation, except as may be set forth
in said Schedule VI.
(d) Protection of Administrative Agent's Security. On a
continuing basis, each Pledgor shall, at its sole cost and expense, (i) promptly
following its becoming aware thereof, notify the Administrative Agent of (A) any
material adverse determination in any proceeding in the United States Patent and
Trademark Office or the United States Copyright Office with respect to any
material Patent, Trademark or Copyright or (B) the institution of any proceeding
or any adverse determination in any federal, state or local court or other
Governmental Authority regarding such Pledgor's claim of ownership in or right
to use any of the material Intellectual Property Collateral, its right to
register such Intellectual Property Collateral or its right to keep and maintain
such registration in full force and effect, (ii) maintain and protect the
material Intellectual Property Collateral necessary for the operation of such
Pledgor's business, (iii) not permit to lapse or become abandoned, lost or
dedicated to the public any Intellectual Property Collateral necessary for the
operation of such Pledgor's business, (iv) not license the material Intellectual
Property Collateral other than licenses entered into by such Pledgor in, or
incidental to, the ordinary course of business, or amend or permit the amendment
of any of the licenses in a manner that materially adversely affects the right
to receive payments thereunder, or in any manner that would materially impair
the value of the Intellectual Property Collateral or the Lien (in either case
when viewed in the aggregate) on the Intellectual Property Collateral granted to
the Administrative Agent for the benefit of the Secured Parties, without the
consent of the Administrative Agent, (v) until the Administrative Agent
exercises its rights to make collection, diligently keep adequate records
respecting the material Intellectual Property Collateral in a manner and to the
extent such records are customarily maintained by Pledgor in the ordinary course
of business, and (vi) furnish to the Administrative Agent from time to time
statements and amended schedules further identifying and describing the
Intellectual Property Collateral and such other materials evidencing or reports
pertaining to the Intellectual Property Collateral as the Administrative Agent
may from time to time reasonably request, all in reasonable detail.
(e) After-Acquired Property. If any Pledgor shall, at any time
before the Secured Obligations have been paid or the Commitments of the Lenders
to make any Loan or to issue any Letter of Credit have expired or been sooner
terminated (i) obtain any rights to any additional Intellectual Property
Collateral or (ii) become entitled to the benefit of any additional Intellectual
Property Collateral or any renewal or extension thereof, including any reissue,
division, continuation, or continuation-in-part of any Patent, or any
improvement on any Patent, the provisions of this Agreement shall automatically
apply thereto and any such item enumerated in clause (i) or (ii) with respect to
such Pledgor shall automatically constitute Intellectual Property Collateral if
such would have constituted Intellectual Property Collateral at the time of
execution of this Agreement and be subject to the Lien created by this Agreement
without further action by any party other than actions required to perfect such
Lien. Each Pledgor shall promptly provide to the Administrative Agent written
notice of any of the foregoing involving Intellectual Property Collateral with a
value in excess of $3,000,000.
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(f) Modifications. Each Pledgor authorizes the Administrative
Agent to modify this Agreement by amending Schedules III, IV, V and VI hereto to
include any future Intellectual Property Collateral of such Pledgor, including,
without limitation, any of the items listed in Section 9(e) hereof.
(g) Applications. Each Pledgor shall use commercially
reasonable efforts to file and prosecute diligently all applications for the
Patents, the Trademarks or the Copyrights now or hereafter pending that would be
necessary to the business of such Pledgor to which any such applications
pertain, except to the extent that a failure to do so could not reasonably be
expected to result in a Material Adverse Effect, and shall use commercially
reasonable efforts to do all acts necessary to preserve and maintain all rights
in the Intellectual Property Collateral necessary for the operation of such
Pledgor's business, except to the extent that a failure to do so could not
reasonably be expected to result in a Material Adverse Effect. Any and all costs
and expenses incurred in connection with any such actions shall be borne by the
Pledgors. No Pledgor shall abandon any right to file a material Patent,
Trademark or Copyright application, or any pending material Patent, Trademark or
Copyright application or any Patent, Trademark or Copyright necessary for the
operation of such Pledgor's business without the consent of the Administrative
Agent, which consent shall not be unreasonably withheld; delayed or conditioned.
(h) Litigation. (i) Unless there shall occur and be continuing
any Event of Default, each Pledgor shall have the right to commence and
prosecute in its own name, as the party in interest, for its own benefit and at
the sole cost and expense of the Pledgors, such applications for protection of
the Intellectual Property Collateral and suits, proceedings or other actions for
infringement, counterfeiting, unfair competition, dilution or other damage as
are in its reasonable business judgment necessary to protect the Intellectual
Property Collateral. Each Pledgor shall promptly notify the Administrative Agent
in writing as to the commencement and prosecution of any such actions, or threat
thereof (except where such action is not reasonably likely to have a Material
Adverse Effect) relating to the Intellectual Property Collateral, and shall
provide to the Administrative Agent such information with respect thereto as may
be reasonably requested by the Administrative Agent. Each Pledgor shall
indemnify and hold harmless each Secured Party for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, expenses or
disbursements (including attorneys' fees and expenses) of any kind whatsoever
which may be imposed on, incurred by or asserted against such Secured Party in
connection with or in any way arising out of such suits, proceedings or other
actions.
(ii) Upon the occurrence and during the continuance of any
Event of Default, the Administrative Agent shall have the right but shall in no
way be obligated to file applications for protection of the Intellectual
Property Collateral and/or bring suit in the name of any Pledgor, the
Administrative Agent or the Secured Parties to enforce the Intellectual Property
Collateral and any license thereunder. In the event of such suit, each Pledgor
shall, at the request of the Administrative Agent, do any and all lawful acts
and execute any and all documents requested by the Administrative Agent in aid
of such enforcement and the Pledgors shall promptly, upon demand, reimburse and
indemnify the
23
Administrative Agent, as the case may be, for all costs and expenses (including
fees and expenses of counsel) incurred by the Administrative Agent in the
exercise of its rights under this Section 9(h). In the event that the
Administrative Agent shall elect not to bring suit to enforce the Intellectual
Property Collateral, each Pledgor agrees, at the request of the Administrative
Agent, to use all reasonable measures, whether by action, suit, proceeding or
otherwise, to prevent the infringement, counterfeiting or other diminution in
value of any of the Intellectual Property Collateral by others and for that
purpose agrees to diligently maintain any action, suit or proceeding against any
person so infringing necessary to prevent such infringement unless such Pledgor
has determined that such Intellectual Property Collateral that is the subject of
any pending or contemplated infringement or enforcement action or proceeding
does not contain or represent any value or utility (other than of an immaterial
nature), consistent with prudent business practice.
SECTION 10. Special Provisions Concerning Financial Accounts.
Each Pledgor shall comply with the following covenants and makes the following
representations and warranties.
(a) Financial Accounts. Each financial account with amounts
therein in excess of $1,000,000 shall be subject to a financial account control
agreement in a form acceptable to the Administrative Agent and each
Concentration Account referred to in subsection (b) below shall be subject to a
deposit account control agreement substantially in the form of Exhibit 2 (or
such other form acceptable to the Administrative Agent). If any Pledgor is
unable to obtain such an agreement from any Financial Intermediary, then such
Pledgor shall terminate all financial accounts maintained with such Financial
Intermediary and transfer all moneys, instruments, securities, proceeds and
other property deposited therein to another financial account maintained with
the Administrative Agent or a Financial Intermediary that has executed such an
agreement. Each Pledgor hereby represents and warrants that it does not now
maintain, and will not in the future maintain, (i) any other financial account
with any Financial Intermediary or any other banking or financial institution
other than the accounts set forth on Schedule VII or (ii) any other
concentration accounts with any banking or financial institution other than the
accounts set forth on Schedule VII; provided, however, that (I) any Pledgor may
establish and maintain additional financial accounts with any Financial
Intermediary or any new Financial Intermediary if (x) in the case of an existing
Financial Intermediary, such Pledgor, the Financial Intermediary and the
Administrative Agent shall have entered into an amendment to the relevant
financial account control agreement to include such new financial account under
such financial account control agreement, such amendment to be in form and
substance satisfactory to the Administrative Agent, and (y) in the case of a new
Financial intermediary such new Financial Intermediary shall enter into a
financial account control agreement in a form acceptable to the Administrative
Agent and (II) any Pledgor may establish and maintain any additional
concentration account with any banking or financial institution if (x) the
Pledgor, such banking or financial institution and the Administrative Agent
shall have entered into an amendment to the relevant deposit account control
agreement to include such new account under such control agreement, such
amendment to be in form and substance satisfactory to the Administrative Agent,
and (y) in the case of a deposit
24
account maintained with a banking or financial institution not then party to a
deposit account control agreement with the Administrative Agent, such new
banking or financial institution shall enter into a deposit account control
agreement substantially in the form of Exhibit 2 hereto (or such other form
acceptable to the Administrative Agent) with respect to such new concentration
account.
(b) Concentration Accounts. The Pledgors will maintain one or
more concentration accounts or subaccounts (the "Concentration Accounts") with
Bank of America, N.A. or another banking or financial institution reasonably
acceptable to the Administrative Agent into which all cash held in any deposit
account of the Pledgors in excess of $1,000,000 (as determined with respect to
all deposit accounts in the aggregate) shall be deposited by 12:00 p.m. New York
time on each Business Day, subject to the provisions of subsection (c) below.
The Administrative Agent shall be permitted to designate a Lender that agrees to
be a collateral sub-agent for the Administrative Agent to be the Financial
Intermediary for the Concentration Accounts.
(c) Dispositions from the Accounts. Until an Event of Default
shall have occurred and be continuing, each Pledgor is hereby permitted to give
instructions and entitlement orders with respect to all financial accounts and
Concentration Accounts and use all monies and Financial Account Collateral in a
manner permitted by the Credit Agreement.
(d) Revocation of Withdrawal Right. Upon the occurrence and
during the continuance of any Event of Default, the authority of the Pledgors
under subsection (c) above shall be revoked by the Administrative Agent and all
deposits maintained in the Concentration Accounts or with a Financial
Intermediary, and any additional moneys, instruments, securities, proceeds and
other property subsequently maintained with a Financial Intermediary, shall, at
the request of the Administrative Agent, be transferred to a collateral account
or sub-account maintained by the Administrative Agent (or a Lender that agrees
to be a collateral sub-agent for the Administrative Agent) in its name as
collateral agent for the Secured Parties (the "Collateral Account"); provided,
however, that following the cure or other end of an Event of Default, the
Administrative Agent shall promptly transfer all amounts previously transferred
by operation of this Section 10(d) to the respective accounts from which such
amounts were transferred (less any amounts determined by Administrative Agent to
be due and payable to Administrative Agent). All such deposits in any such
Collateral Account shall constitute "Pledged Collateral" for all purposes of
this Agreement and shall be held by the Administrative Agent as Pledged
Collateral for the Secured Obligations or applied to the payment of the Secured
Obligations in accordance with Section 14 hereof. The costs and expenses
(including attorney's fees) of collection, whether incurred by any Pledgor or
the Administrative Agent (or any sub-agent), shall be borne by the Pledgors.
(e) Deposits to Collateral Account. Each Pledgor shall deposit
into the Collateral Account from time to time (i) any cash in respect of any
Pledged Collateral which the Administrative Agent is entitled to pursuant to
Section 7(d) or Section 8(b)(ii)(B) hereof or otherwise under the Credit
Documents and (ii) any
25
additional amounts that such Pledgor desires to pledge to the Administrative
Agent for the benefit of the Secured Parties as additional collateral security
hereunder or which such Pledgor is required to pledge as additional collateral
security hereunder pursuant to the Credit Documents.
(f) Application of Amounts in Collateral Account. The balance
from time to time in the Collateral Account shall constitute part of the Pledged
Collateral hereunder and shall not constitute payment of the Secured Obligations
until applied as hereinafter provided. So long as no Event of Default has
occurred and is continuing or will result therefrom, the Administrative Agent
shall remit the collected balance outstanding to the credit of the Collateral
Account to or upon the order of the respective Pledgor, in periodic
installments, if applicable, upon submission of reasonable evidence that such
amount is to be applied as permitted by Section 2.10(a) of the Credit Agreement;
provided that any amounts deposited in the Collateral Account in respect of
prepayments or reductions of Loans or Commitments under Section 2.10(a) of the
Credit Agreement which are to be applied to LIBOR Loans as provided in Section
2.10(b) of the Credit Agreement shall be held by the Administrative Agent until
the end of the respective Interest Periods of such LIBOR Loans at which time,
whether or not an Event of Default has occurred, the Administrative Agent shall
cause such monies to be applied to such LIBOR Loans. However, at any time
following the occurrence and during the continuance of an Event of Default, the
Administrative Agent may (and, if instructed by the Lenders as specified in the
Credit Agreement, shall) in its (or their) discretion apply or cause to be
applied (subject to collection) the balance from time to time in the Collateral
Account to the payment of the Secured Obligations in the manner specified in
Section 14 hereof. The balance from time to time in the Collateral Account shall
be subject to withdrawal only as provided herein.
(g) Investment of Balance in Collateral Account. Amounts on
deposit in the Collateral Account shall be invested from time to time in such
Permitted Investments as the respective Pledgor (or, after the occurrence and
during the continuance of an Event of Default, the Administrative Agent) shall
determine which Permitted Investments shall be held in the name and be under the
control of the Administrative Agent (or any sub-agent); provided, however, that
at any time after the occurrence and during the continuance of an Event of
Default, the Administrative Agent may (and, if instructed by the Lenders as
specified in the Credit Agreement, shall) in its (or their) discretion at any
time and from time to time elect to liquidate any such Permitted Investments and
to apply or cause to be applied the proceeds thereof to the payment of the
Secured Obligations in the manner specified in Section 14 hereof.
(h) Cover for Letter of Credit Liabilities. Amounts deposited
into the Collateral Account as cover for liabilities in respect of Letters of
Credit under the Credit Agreement pursuant to Section 10 thereof shall be held
by the Administrative Agent in a separate sub-account (designated "Letter of
Credit Liabilities Sub-Account") and, notwithstanding any other provision of
this Agreement to the contrary, all amounts held in such sub-account shall
constitute collateral security first, for the liabilities in respect of Letters
of Credit outstanding from time to time and second, as collateral security for
the other Secured Obligations hereunder until such time as all Letters of Credit
shall
26
have been terminated and all of the liabilities in respect of Letters of Credit
have been paid in full.
SECTION 11. Transfers and Other Liens. No Pledgor shall (a)
sell, convey, assign or otherwise dispose of, or grant any option with respect
to, any of the Pledged Collateral pledged by it hereunder except as permitted by
the Credit Agreement, (b) create or permit to exist any Lien upon or with
respect to any of the Pledged Collateral pledged by it hereunder other than as
provided by the Credit Agreement or (c) except to the extent otherwise permitted
under the Credit Agreement, permit any issuer of the Pledged Securities to
merge, consolidate or change its legal form other than as provided by the Credit
Agreement.
SECTION 12. Reasonable Care. The Administrative Agent's sole
duty with respect to the custody, safe keeping and physical preservation of the
Pledged Collateral in its possession, under Section 9-207 of the UCC or
otherwise, shall be to deal with such Pledged Collateral in the same manner as
the Administrative Agent deals with similar property for its own account, it
being understood that neither the Administrative Agent nor any of the Secured
Parties shall have responsibility for (i) ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relating to any Securities Collateral, whether or not the Administrative Agent
or any other Secured Party has or is deemed to have knowledge of such matters or
(ii) taking any necessary steps to preserve rights against any Person with
respect to any Pledged Collateral.
SECTION 13. Remedies upon Default; Obtaining the Pledged
Collateral upon Event of Default. (a) If any Event of Default shall have
occurred and be continuing, the Pledgors shall, at the request of the
Administrative Agent, notify account debtors and other persons obligated on any
of the Pledged Collateral of the security interest of the Administrative Agent
in any account, chattel paper, general intangible, instrument or other Pledged
Collateral and that payment thereof is to be made directly to the Administrative
Agent or to any financial institution designated by the Administrative Agent as
the Administrative Agent's agent therefor, and the Administrative Agent may
itself, if an Event of Default shall have occurred and be continuing, without
notice to or demand upon the Pledgors, so notify account debtors and other
persons obligated on Pledged Collateral. After the making of such a request or
the giving of any such notification, each Pledgor shall hold any proceeds of
collection of accounts, chattel paper, general intangibles, instruments and
other Pledged Collateral received by such Pledgor as trustee for the
Administrative Agent without commingling the same with other funds of such
Pledgor and shall turn the same over to the Administrative Agent in the
identical form received, together with any necessary endorsements or
assignments. The Administrative Agent may apply the proceeds of collection of
accounts, chattel paper, general intangibles, instruments and other Pledged
Collateral received by the Administrative Agent to the Secured Obligations or
hold such proceeds as additional Pledged Collateral, at the option of the
Administrative Agent.
(b) If any Event of Default shall have occurred and be
continuing, then and in every such case, the Administrative Agent may:
27
(i) personally, or by agents or attorneys, immediately take
possession of the Pledged Collateral or any part thereof, from any Pledgor 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 without liability for
trespass enter upon any Pledgor's premises where any of the Pledged Collateral
is located, remove such Pledged Collateral, remain present at such premises to
receive copies of all communications and remittances relating to the Pledged
Collateral and use in connection with such removal and possession any and all
services, supplies, aids and other facilities of any Pledgor;
(ii) demand, xxx for, collect or receive any money or property
at any time payable or receivable in respect of the Pledged Collateral,
including, without limitation, instructing the obligor or obligors on any
agreement, instrument or other obligation (including, without limitation, the
Receivables and Contracts) constituting part of the Pledged Collateral to make
any payment required by the terms of such instrument or agreement directly to
the Administrative Agent, and in connection with any of the foregoing,
compromising, settling, extending the time for payment and making other
modifications with respect thereto; provided, however, that in the event that
any such payments are made directly to any Pledgor, prior to receipt by any such
obligor of such instruction, such Pledgor shall pay the same promptly to the
Administrative Agent;
(iii) sell, assign or otherwise liquidate, or direct any
Pledgor to sell, assign or otherwise liquidate, any or all investments made in
whole or in part with the Pledged Collateral or any part thereof, and take
possession of the proceeds of any such sale, assignment or liquidation;
(iv) take possession of the Pledged Collateral or any part
thereof, by directing any Pledgor in writing to deliver the same to the
Administrative Agent at any place or places so designated by the Administrative
Agent, in which event such Pledgor shall at its own expense: (A) forthwith cause
the same to be moved to the place or places designated by the Administrative
Agent and there delivered to the Administrative Agent, (B) store and keep any
Pledged Collateral so delivered to the Administrative Agent at such place or
places pending further action by the Administrative Agent; and (C) while the
Pledged Collateral shall be so stored and kept, provide such security and
maintenance services as shall be necessary to protect the same and to preserve
and maintain them in good condition. Each Pledgor's obligation to deliver the
Pledged Collateral is of the essence of this Agreement;
(v) withdraw all moneys, instruments, securities and other
property in any financial or deposit account of any Pledgor for application to
the Secured Obligations as provided in Section 14 hereof;
(vi) retain and apply the Distributions to the Secured
Obligations as provided in Section 14 hereof; and
(vii) exercise any and all rights as beneficial and legal
owner of the Pledged Collateral, including, without limitation, perfecting
assignment of and exercising
28
any and all voting, consensual and other rights and powers with respect to any
Pledged Collateral.
Upon application to a court of equity having jurisdiction, the
Administrative Agent shall be entitled to a decree requiring specific
performance by any Pledgor of such obligation.
(c) Remedies; Disposition of the Pledged Collateral. (i) Upon
the occurrence and during the continuance of any Event of Default, the
Administrative Agent may from time to time exercise in respect of the Pledged
Collateral, in addition to the other rights and remedies provided for herein or
otherwise available to it, all the rights and remedies of a secured party on
default under the UCC, and the Administrative Agent may also in its sole
discretion, without notice except as specified below, sell, assign or grant a
license to use the Pledged Collateral or any part thereof in one or more parcels
at public or private sale, at any exchange, broker's board or at any of the
Administrative Agent's offices or elsewhere, for cash, on credit or for future
delivery, and at such price or prices and upon such other terms as the
Administrative Agent may deem commercially reasonable. The Administrative Agent
or any other Secured Party or any of their respective Affiliates may, if
permitted by Applicable Law, be the purchaser, licensee, assignee or recipient
of any or all of the Pledged Collateral at any such sale and shall be entitled,
for the purpose of bidding and making settlement or payment of the purchase
price for all or any portion of the Pledged Collateral sold, assigned or
licensed at such sale, to use and apply any of the Secured Obligations owed to
such Person as a credit on account of the purchase price of any Pledged
Collateral payable by such Person at such sale. Each purchaser, assignee,
licensee or recipient at any such sale shall acquire the property sold, assigned
or licensed absolutely free from any claim or right on the part of any Pledgor,
and each Pledgor hereby waives, to the fullest extent permitted by law, all
rights of redemption, stay and/or appraisal which it now has or may at any time
in the future have under any rule of law or statute now existing or hereafter
enacted. The Administrative Agent shall not be obligated to make any sale of
Pledged Collateral regardless of notice of sale having been given. The
Administrative Agent may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was so adjourned. Each
Pledgor hereby waives, to the fullest extent permitted by law, any claims
against the Administrative Agent arising by reason of the fact that the price at
which any Pledged Collateral may have been sold, assigned or licensed at such a
private sale was less than the price which might have been obtained at a public
sale, even if the Administrative Agent accepts the first offer received and does
not offer such Pledged Collateral to more than one offeree.
(ii) The Administrative Agent shall give the applicable
Pledgor ten days' notice (which each Pledgor agrees is reasonable notice within
the meaning of Section 9-611 of the New York UCC or its equivalent in other
jurisdictions) of the time and place of any public sale or of the time after
which any private sale or other intended disposition is to take place. No
notification need be given to any Pledgor if it has signed,
29
after the occurrence of an Event of Default, a statement renouncing or modifying
any right to notification of sale or other intended disposition.
(iii) Notwithstanding anything contained to the contrary
herein, the Administrative Agent hereby agrees that, consistent with the
provisions of Section 22.937(f) of the FCC's Rules (47 C.F.R. 22.937(f)), and to
the extent then required by such rule or any successor regulation, the
Administrative Agent shall provide the applicable Pledgor and the FCC with at
least ten (10) days' prior written notification before any Pledged Collateral
constituting equipment utilized in any cellular system operated by a Pledgor
will be repossessed, transferred or disposed of by the Administrative Agent.
(d) Waiver of Notice and Claims. Except as contemplated by
Section 13(c)(ii), each Pledgor hereby waives, to the fullest extent permitted
by applicable law, notice or judicial hearing in connection with the
Administrative Agent's taking possession at such time as an Event of Default
shall have occurred and be continuing or the Administrative Agent's disposition
of any of the Pledged Collateral, including, without limitation, any and all
prior notice and hearing for any prejudgment remedy or remedies and any such
right which such Pledgor would otherwise have under law, and each Pledgor hereby
further waives, to the fullest extent permitted by applicable law: (i) all
damages occasioned by such taking of possession, (ii) all other requirements as
to the time, place and terms of sale or other requirements with respect to the
enforcement of the Administrative Agent's rights hereunder and (iii) all rights
of redemption, appraisal, valuation, stay, extension or moratorium now or
hereafter in force under any applicable law. The Administrative Agent shall not
be liable for any incorrect or improper payment made pursuant to this Section 13
in the absence of gross negligence or willful misconduct. At such time as an
Event of Default shall have occurred and be continuing, any sale of, or the
grant of options to purchase, or any other realization upon, any Pledged
Collateral shall operate to divest all right, title, interest, claim and demand,
either at law or in equity, of the applicable Pledgor therein and thereto, and
shall be a perpetual bar both at law and in equity against such Pledgor and
against any and all Persons claiming or attempting to claim the Pledged
Collateral so sold, optioned or realized upon, or any part thereof, from,
through or under such Pledgor.
(e) Certain Sales of Pledged Collateral. Each Pledgor
recognizes that: (i) by reason of certain prohibitions contained in law, rules,
regulations or orders of any foreign Governmental Authority, the Administrative
Agent may be compelled, with respect to any sale of all or any part of the
Pledged Collateral, to limit purchasers to those who meet the requirements of
such foreign Governmental Authority. Each Pledgor acknowledges that any such
sales may be at prices and on terms less favorable to the Administrative Agent
than those obtainable through a public sale without such restrictions, and,
notwithstanding such circumstances, agrees that any such restricted sale shall
be deemed to have been made in a commercially reasonable manner and that, except
as may be required by applicable law, the Administrative Agent shall have no
obligation to engage in public sales;
30
(ii) at any public or private sale, the Pledged Collateral, or
portion thereof, to be sold may be sold in one lot as an entirety or in separate
parcels, as the Administrative Agent may (in its sole and absolute discretion)
determine. The Administrative Agent shall not be obligated to make any sale of
any Pledged Collateral if it shall determine not to do so, regardless of the
fact that notice of sale of such Pledged Collateral shall have been given. The
Administrative Agent may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for sale, and such sale may, without further notice,
be made at the time and place to which the same was so adjourned. In case any
sale of all or any part of the Pledged Collateral is made on credit or for
future delivery, the Pledged Collateral so sold may be retained by the
Administrative Agent until the sale price is paid by the purchaser or purchasers
thereof, but the Administrative Agent shall not incur any liability in case any
such purchaser or purchasers shall fail to take up and pay for the Pledged
Collateral so sold and, in case of any such failure, such Pledged Collateral may
be sold again upon like notice. At any public (or, to the extent permitted by
law, private) sale made pursuant to this Section, any Secured Party may bid for
or purchase, free (to the extent permitted by law) from any right of redemption,
stay, valuation or appraisal on the part of any Pledgor (all said rights being
also hereby waived and released to the extent permitted by law), the Pledged
Collateral or any part thereof offered for sale and may make payment on account
thereof by using any claim then due and payable to such Secured Party from any
Pledgor as a credit against the purchase price, and such Secured Party may, upon
compliance with the terms of sale, hold, retain and dispose of such property
without further accountability to any Pledgor therefor. For purposes hereof, a
written agreement to purchase the Pledged Collateral or any portion thereof
shall be treated as a sale thereof; the Administrative Agent shall be free to
carry out such sale pursuant to such agreement and no Pledgor shall be entitled
to the return of the Pledged Collateral or any portion thereof subject thereto,
notwithstanding the fact that after the Administrative Agent shall have entered
into such an agreement all Events of Default shall have been remedied and the
Secured Obligations paid in full. As an alternative to exercising the power of
sale herein conferred upon it, the Administrative Agent may proceed by a suit or
suits at law or in equity to foreclose this Agreement and to sell the Pledged
Collateral or any portion thereof pursuant to a judgment or decree of a court or
courts having competent jurisdiction or pursuant to a proceeding by a
court-appointed receiver. To the extent permitted pursuant to applicable law,
any sale pursuant to the provisions of this Section 13(e) shall be deemed to
conform to the commercially reasonable standards as provided in Section 9-610(b)
of the New York UCC or its equivalent in other jurisdictions;
(iii) by reason of certain prohibitions contained in the
Securities Act of 1933, as amended (the "Securities Act"), and applicable state
securities laws, the Administrative Agent may be compelled, with respect to any
sale of all or any part of the Securities Collateral, to limit purchasers to
Persons who will agree, among other things, to acquire such Securities
Collateral for their own account, for investment and not with a view to the
distribution or resale thereof. Each Pledgor acknowledges and agrees that in
light of such restrictions and limitations, the Administrative Agent, in its
sole and absolute discretion (I) may proceed to make such a sale whether or not
a registration statement for the purpose of registering such Pledged Collateral
or part thereof shall have
31
been filed under the Securities Act, or any similar statute hereafter enacted
analogous in purpose or effect, and (II) may approach and negotiate with a
single potential purchaser to effect such sale. Each Pledgor acknowledges and
agrees that any such sale might result in prices and other terms less favorable
to the seller than if such sale were a public sale without such restrictions. In
the event of any such sale, the Administrative Agent shall incur no
responsibility or liability for selling all or any part of the Pledged
Collateral at a price that the Administrative Agent, in its sole and absolute
discretion, may in good xxxxx xxxx reasonable under the circumstances,
notwithstanding the possibility that a substantially higher price might have
been realized if the sale were deferred until after registration under the
Securities Act or if more than a single purchaser were approached. The
provisions of this Section 13(e)(iii) will apply notwithstanding the existence
of a public or private market upon which the quotations or sales prices may
exceed substantially the price at which the Administrative Agent sells.
Notwithstanding the foregoing, each Pledgor shall, upon the
occurrence and during the continuance of any Event of Default, at the request of
the Administrative Agent, for the benefit of the Administrative Agent, cause any
registration, qualification under or compliance with any federal or state
securities law or laws to be effected with respect to all or any part of the
Securities Collateral as soon as practicable and at the sole cost and expense of
the Pledgors. Each Pledgor will use its best efforts to cause such registration
to be effected (and be kept effective) and will use its best efforts to cause
such qualification and compliance to be effected (and be kept effective) as may
be so requested and as would permit or facilitate the sale and distribution of
such Securities Collateral, including, without limitation, registration under
the Securities Act (or any similar statute then in effect), appropriate
qualifications under applicable blue sky or other state securities laws and
appropriate compliance with any other government requirements. Each Pledgor
shall cause the Administrative Agent to be kept advised in writing as to the
progress of each such registration, qualification or compliance and as to the
completion thereof, shall furnish to the Administrative Agent such number of
prospectuses, offering circulars or other documents incident thereto as the
Administrative Agent from time to time may request, and shall indemnify and
shall cause the issuer of the Securities Collateral to indemnify the
Administrative Agent and all others participating in the distribution of such
Securities Collateral against all claims, losses, damages and liabilities caused
by any untrue statement (or alleged untrue statement) of a material fact
contained therein (or in any related registration statement, notification or the
like) or by any omission (or alleged omission) to state therein (or in any
related registration statement, notification or the like) a material fact
required to be stated therein or necessary to make the statements therein not
misleading.
If the Administrative Agent determines to exercise its right
to sell any or all of the Securities Collateral, upon written request, the
applicable Pledgor shall from time to time furnish to the Administrative Agent
all such information as the Administrative Agent may request in order to
determine the number of securities included in the Securities Collateral which
may be sold by the Administrative Agent as exempt transactions under the
Securities Act and the rules of the Securities and Exchange Commission
thereunder, as the same are from time to time in effect.
32
SECTION 14. Application of Proceeds. The proceeds received by
the Administrative Agent in respect of any sale of, collection from or other
realization upon all or any part of the Pledged Collateral pursuant to the
exercise by the Administrative Agent of its remedies as a secured creditor as
provided in Section 13 hereof shall be applied, together with any other sums
then held by the Administrative Agent pursuant to this Agreement, promptly by
the Administrative Agent as follows:
first, to the payment of all costs and expenses,
court costs, fees, commissions and taxes of such sale,
collection or other realization, including, without
limitation, compensation to the Administrative Agent and its
agents and counsel, and all expenses, liabilities and advances
made or incurred by the Administrative Agent in connection
therewith, together with interest on each such amount at the
highest rate then in effect under the Credit Agreement from
and after the date such amount is due, owing or unpaid until
paid in full;
second, to the payment of all other costs and
expenses of such sale, collection or other realization,
including, without limitation, compensation to the Lenders and
their agents and counsel and all costs, liabilities and
advances made or incurred by the Lenders in connection
therewith, together with interest on each such amount at the
highest rate then in effect under the Credit Agreement from
and after the date such amount is due, owing or unpaid until
paid in full;
third, without duplication of amounts applied
pursuant to clauses first and second above, to the
indefeasible payment in full in cash, pro rata, of (i)
interest, principal and other amounts constituting Secured
Obligations (other than Interest Rate Obligations) in
accordance with the terms of the Credit Agreement and (ii) the
Interest Rate Obligations in accordance with the terms of the
Interest Rate Agreements; and
fourth, the balance, if any, to the Person lawfully
entitled thereto (including the Pledgors or their respective
successors or assigns).
In the event that any such proceeds are insufficient to pay in
full the items described in clauses first through third of this Section 14, the
Pledgors shall remain liable for any deficiency.
SECTION 15. Expenses. Each Pledgor will upon demand pay to the
Administrative Agent the amount of any and all reasonable expenses, including
the reasonable fees and expenses of its counsel and the reasonable fees and
reasonable expenses of any experts and agents which the Administrative Agent may
incur in connection with (a) the collection of the Secured Obligations, (b) the
enforcement and administration of this Agreement, (c) the custody or
preservation of, or the sale of,
33
collection from, or other realization upon, any of the Pledged Collateral, (d)
the exercise or enforcement of any of the rights of the Administrative Agent or
any Secured Party hereunder or (e) the failure by any Pledgor to perform or
observe any of the provisions hereof. All amounts payable by any Pledgor under
this Section 15 shall be due within five (5) Business Days following demand
thereof and shall be part of the Secured Obligations. Each Pledgor's obligations
under this Section 15 shall survive the termination of this Agreement and the
discharge of such Pledgor's other obligations hereunder.
SECTION 16. No Waiver; Cumulative Remedies. (a) No failure on
the part of the Administrative Agent to exercise, no course of dealing with
respect to, and no delay on the part of the Administrative Agent in exercising,
any right, power or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any such right, power or remedy
hereunder preclude any other or further exercise thereof or the exercise of any
other right, power or remedy; nor shall the Administrative Agent be required to
look first to, enforce or exhaust any other security, collateral or guaranties.
The remedies herein provided are cumulative and are not exclusive of any
remedies provided by law.
(b) In the event that the Administrative Agent shall have
instituted 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 Administrative Agent, then and in every such case, the
Pledgors, the Administrative Agent and each Secured Party shall be restored to
their respective former positions and rights hereunder with respect to the
Pledged Collateral, and all rights, remedies and powers of the Administrative
Agent and the Secured Parties shall continue as if no such proceeding had been
instituted.
SECTION 17. Administrative Agent. The Administrative Agent has
been appointed as collateral agent pursuant to the Credit Agreement. The actions
of the Administrative Agent hereunder are subject to the provisions of the
Credit Agreement. The Administrative Agent shall have the right hereunder to
make demands, to give notices, to exercise or refrain from exercising any
rights, and to take or refrain from taking action (including, without
limitation, the release or substitution of Pledged Collateral), in accordance
with this Agreement and the Credit Agreement. The Administrative Agent may
employ agents and attorneys-in-fact in connection herewith and shall not be
liable for the negligence or misconduct of any such agents or attorneys-in-fact
selected by it in good faith. The Administrative Agent may resign and a
successor Administrative Agent may be appointed in the manner provided for in
the Credit Agreement. Upon the acceptance of any appointment as Administrative
Agent by a successor Administrative Agent, that successor Administrative Agent
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent under this Agreement,
and the retiring Administrative Agent shall thereupon be discharged from its
duties and obligations under this Agreement. After any retiring Administrative
Agent's resignation, the provisions of this Agreement shall inure to its benefit
as to any actions taken or omitted to be taken by it
34
under this Agreement while it was the Administrative Agent.
SECTION 18. Administrative Agent May Perform; Administrative
Agent Appointed Attorney-in-Fact. If any Pledgor shall fail to do any act or
thing that it has covenanted to do hereunder or if any warranty on the part of
any Pledgor contained herein shall be breached, the Administrative Agent may
(but shall not be obligated to) do the same or cause it to be done or remedy any
such breach, and may expend funds for such purpose. Any and all amounts so
expended by the Administrative Agent shall be paid by the Pledgors promptly upon
demand therefor, with interest at the highest rate then in effect under the
Credit Agreement during the period from and including the date on which such
funds were so expended to the date of repayment. Each Pledgor's obligations
under this Section 18 shall survive the termination of this Agreement and the
discharge of such Pledgor's other obligations under this Agreement, the Credit
Agreement, any Interest Rate Agreement and the other Credit Documents. Each
Pledgor hereby appoints the Administrative Agent its attorney-in-fact, with full
authority in the place and stead of such Pledgor and in the name of such
Pledgor, or otherwise, from time to time in the Administrative Agent's
discretion to take any action and to execute any instrument consistent with the
terms of this Agreement and the other Credit Documents which the Administrative
Agent may deem necessary or advisable to accomplish the purposes of this
Agreement. The foregoing grant of authority is a power of attorney coupled with
an interest and such appointment shall be irrevocable for the term of this
Agreement. Each Pledgor hereby ratifies all that such attorney shall lawfully do
or cause to be done by virtue hereof.
SECTION 19. Indemnity. (a) Indemnity. Each Pledgor agrees to
indemnify, pay and hold harmless the Administrative Agent and each of the other
Secured Parties and the officers, directors, employees, agents and Affiliates of
the Administrative Agent and each of the other Secured Parties (collectively,
the "Indemnitees") from and against any and all other liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, claims, costs (including,
without limitation, settlement costs), reasonable expenses or disbursements of
any kind or nature whatsoever (including, without limitation, the fees and
reasonable disbursements of counsel for such indemnitees in connection with any
investigative, administrative or judicial proceeding commenced or threatened,
whether or not such Indemnitee shall be designated a party thereto) which may be
imposed on, incurred by, or asserted against that Indemnitee, in any manner
relating to or arising out of this Agreement, any Interest Rate Agreement or any
other Credit Document (including, without limitation, any misrepresentation by
any Pledgor in this Agreement, any Interest Rate Agreement or any other Credit
Document) (the "indemnified liabilities"); provided that no Pledgor shall have
any obligation to an Indemnitee hereunder with respect to indemnified
liabilities if it has been determined by a final decision (after all appeals and
the expiration of time to appeal) of a court of competent jurisdiction that such
indemnified liability arose from the gross negligence or willful misconduct of
that Indemnitee. To the extent that the undertaking to indemnify, pay and hold
harmless set forth in the preceding sentence may be unenforceable because it is
violative of any law or public policy, each Pledgor shall contribute the maximum
portion which it is permitted to pay and satisfy under applicable law to the
payment and satisfaction of all indemnified liabilities incurred by the
Indemnitees or any of them.
35
(b) Survival. The obligations of the Pledgors contained in
this Section 19 shall survive the termination of this Agreement and the
discharge of the Pledgors' other obligations under this Agreement, any Interest
Rate Agreement and under the other Credit Documents.
(c) Reimbursement. Any amounts paid by any Indemnitee as to
which such Indemnitee has the right to reimbursement shall constitute Secured
Obligations secured by the Pledged Collateral.
SECTION 20. Modification in Writing. No amendment,
modification, supplement, termination or waiver of or to any provision of this
Agreement, nor consent to any departure by any Pledgor therefrom, shall be
effective unless the same shall be made in accordance with the terms of the
Credit Agreement and unless in writing and signed by the Administrative Agent.
Any amendment, modification or supplement of or to any provision of this
Agreement, any waiver of any provision of this Agreement and any consent to any
departure by any Pledgor from the terms of any provision of this Agreement shall
be effective only in the specific instance and for the specific purpose for
which made or given. Except where notice is specifically required by this
Agreement or any other Credit Document, no notice to or demand on any Pledgor in
any case shall entitle any Pledgor to any other or further notice or demand in
similar or other circumstances.
SECTION 21. Termination; Release. (a) This Agreement, the
Guarantees, and the security interests granted hereby shall terminate when all
the Secured Obligations have been indefeasibly paid in full in cash, or if
applicable, the Guaranteed Obligations have been fulfilled, and the Lenders have
no further commitment to lend under the Credit Agreement, the Letter of Credit
Liability has been reduced to zero and the Issuing Lender has no further
obligations to issue Letters of Credit under the Credit Agreement.
(b) A Pledgor shall automatically be released from its
obligations hereunder and under Section 6 of the Credit Agreement and the
security interests in the Pledged Collateral owned or held by such Pledgor shall
be automatically released upon the consummation of any transaction permitted by
the Credit Agreement as a result of which such Pledgor ceases to be a Subsidiary
of the Borrower; provided that the Creditors shall have consented to such
transaction (to the extent required by the Credit Agreement) and the terms of
such consent did not provide otherwise.
(c) Upon any sale or other transfer by any Pledgor of any
Pledged Collateral that is permitted under the Credit Agreement to any Person
that is not Parent or a Subsidiary or, upon the effectiveness of any written
consent to the release of the security interest granted hereby in any Pledged
Collateral pursuant to Section 12.04 of the Credit Agreement, the security
interest in such Pledged Collateral granted hereunder shall be automatically
released.
(d) In connection with any termination or release pursuant to
this Section 21, the Administrative Agent shall execute and deliver to the
applicable Pledgor,
36
at such Pledgor's expense, all documents that such Pledgor shall reasonably
request to evidence such termination or release.
SECTION 22. Notices. Unless otherwise provided herein or in
the Credit Agreement, any notice or other communication herein required or
permitted to be given shall be given in the manner set forth in the Credit
Agreement, as to any Pledgor, addressed to it at the address of Borrower set
forth in the Credit Agreement and as to the Administrative Agent, addressed to
it at the address set forth in the Credit Agreement, or in each case at such
other address as shall be designated by such party in a written notice to the
other party complying as to delivery with the terms of this Section 22; provided
that notices to the Administrative Agent shall not be effective until received
by the Administrative Agent.
SECTION 23. Continuing Security Interest; Assignment. This
Agreement shall create a continuing security interest in the Pledged Collateral
and shall (i) be binding upon the Pledgors, their respective successors and
assigns and (ii) inure, together with the rights and remedies of the
Administrative Agent hereunder, to the benefit of the Administrative Agent and
the other Secured Parties and each of their respective successors, transferees
and assigns; no other Persons (including, without limitation, any other creditor
of any Pledgor) shall have any interest herein or any right or benefit with
respect hereto. Without limiting the generality of the foregoing clause (ii),
any Lender may assign or otherwise transfer any indebtedness held by it secured
by this Agreement to any other Person, and such other Person shall thereupon
become vested with all the benefits in respect thereof granted to such Lender,
herein or otherwise, subject however, to the provisions of the Credit Agreement
and any applicable Interest Rate Agreement. Each Affiliate of Borrower which
from time to time after the initial date of this Agreement is required under the
Credit Agreement to pledge any assets to the Administrative Agent for the
benefit of the Secured Parties may become a party hereto upon execution and
delivery to the Administrative Agent of a joinder agreement substantially in the
form attached hereto as Exhibit 4, and upon such execution and delivery shall be
deemed to be a "Guarantor" and a "Pledgor" for all purposes hereunder.
SECTION 24. Governing Law. (a) This Agreement shall be
construed in accordance with and governed by the laws of the State of New York.
(b) Jurisdiction; Consent to Service of Process. Each Pledgor
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or Federal court of
the United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such New
York State or, to the extent permitted by law, in such Federal court. Each of
the parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement shall
affect any right that the Administrative Agent, the Issuing Lender or any Lender
may otherwise
37
have to bring any action or proceeding relating to this Agreement the against
the Pledgors or their respective properties in the courts of any jurisdiction.
(c) Each the Pledgor hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement in any New
York State or Federal court. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
SECTION 25. Waiver of Jury Trial. Each party hereto hereby
waives, to the fullest extent permitted by applicable law, any right it may have
to a trial by jury in any legal proceeding directly or indirectly arising out of
or relating to this Agreement, or the transactions contemplated hereby (whether
based on contract, tort or any other theory). Each party hereto (i) certifies
that no representative, agent or attorney of any other party has represented,
expressly or otherwise, that such other party would not, in the event of
litigation, seek to enforce the foregoing waiver and (ii) acknowledges that it
and the other parties hereto have been induced to enter into this agreement by,
among other things, the mutual waivers and certifications in this Section 25.
SECTION 26. Severability of Provisions. Any provision of this
Agreement which is invalid, illegal or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such invalidity,
illegality or unenforceability without invalidating the remaining provisions
hereof or affecting the validity or enforceability of such provision in any
other jurisdiction. The parties shall endeavor in good-faith negotiations to
replace the invalid, illegal or unenforceable provisions with valid provisions
the economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.
SECTION 27. Execution in Counterparts. This Agreement and any
amendments, waiver, consents or supplements hereto may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed and delivered shall be deemed to be an original, but
all such counterparts together shall constitute one and the same agreement.
SECTION 28. Headings. The Section headings used in this
Agreement are for convenience of reference only and shall not affect the
construction of this Agreement.
SECTION 29. Obligations Absolute. All obligations of each
Pledgor hereunder shall be absolute and unconditional irrespective of:
(i) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of any Pledgor or any other
Credit Party;
38
(ii) any lack of validity or enforceability of the Credit
Agreement, any Interest Rate Agreement, any Letter of Credit or any other Credit
Document, or any other agreement or instrument relating thereto;
(iii) any change in the time, manner or place of payment of,
or in any other term of, all or any of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from the Credit
Agreement, any Interest Rate Agreement, any Letter of Credit or any other Credit
Document, or any other agreement or instrument relating thereto;
(iv) any pledge, exchange, release or non-perfection of any
other collateral, or any release or amendment or waiver of or consent to any
departure from any guarantee, for all or any of the Secured Obligations;
(v) any exercise, non-exercise or waiver of any right, remedy,
power or privilege under or in respect of this Agreement, any Interest Rate
Agreement or any other Credit Document except as specifically set forth in a
waiver granted pursuant to the provisions of Section 20 hereof; or
(vi) any other circumstances which might otherwise constitute
a defense available to, or a discharge of, any Pledgor other than the defense
that no Event of Default has occurred and is continuing.
SECTION 30. Future Advances. This Agreement shall secure the
payment of any amounts advanced from time to time pursuant to the Credit
Agreement.
39
IN WITNESS WHEREOF, the Pledgors and the Administrative Agent
have caused this Agreement to be duly executed and delivered by their duly
authorized officers as of the date first above written.
CREDIT SUISSE FIRST BOSTON, acting through
its cayman islands branch, as administrative
agent,
by
/s/ SOVONNA DAY-XXXXX
---------------------------------------
Name: Sovonna Day-Xxxxx
Title: Vice President
by
/s/ XXX XXXXX
---------------------------------------
Name: Xxx Xxxxx
Title: Director
CENTENNIAL CELLULAR OPERATING CO. LLC,
by
/s/ XXXX XXXX
---------------------------------------
Name: Xxxx Xxxx
Title: Senior Vice President,
General Counsel
CENTENNIAL PUERTO RICO OPERATIONS CORP.,
by
/s/ XXXX XXXX
---------------------------------------
Name: Xxxx Xxxx
Title: Senior Vice President,
General Counsel
40
EACH OF THE OTHER GUARANTORS LISTED ON ANNEX
A-2 ATTACHED HERETO,
by
/s/ XXXX XXXX
---------------------------------------
Name: Xxxx Xxxx
Title: Senior Vice President,
General Counsel
CENTENNIAL COMMUNICATIONS CORP.,
by
/s/ XXXX XXXX
---------------------------------------
Name: Xxxx Xxxx
Title: Senior Vice President,
General Counsel
00
XXXXX X-0
XXXXXXXXXX
Xxxxx Communications, Inc.
Bauce Communications of Beaumont, Inc.
Centennial Xxxxxxxxxx Cellular LLC
Centennial Xxxxxxxxxx Holding Corp.
Centennial Xxxxxx Harbor Cellular Corp.
Centennial Xxxxxx Harbor Holding Corp.
Centennial Xxxxxxxx Cellular Corp.
Centennial Caribbean Holding Corp.
Centennial Cellular Operating Co. LLC
Centennial Cellular Telephone Company of Del Norte
Centennial Cellular Telephone Company of Xxxxxxxx
Centennial Cellular Telephone Company of Sacramento Valley
Centennial Cellular Telephone Company of San Francisco
Centennial Cellular Tri-State Operating Partnership
Centennial Claiborne Cellular Corp.
Centennial Clinton Cellular Corp.
Centennial Communications Corp.
Centennial Dominican Republic Holding Corp.
Centennial Florida Switch Corp.
Centennial Xxxxxxx Cellular LLC
Centennial Iberia Holding Corp.
Centennial Xxxxxxx Cellular Corp.
Centennial Jamaica Infochannel Holding Corp.
Centennial Lafayette Cellular Corp.
Centennial Lafayette Communications LLC
Centennial Louisiana Holding Corp.
Centennial Mega Comm Holding Corp.
Centennial Michiana License Co. LLC
Centennial Michigan RSA 6 Cellular Corp.
Centennial Michigan RSA 7 Cellular Corp.
Centennial Microwave Corp.
Centennial Xxxxxxxxx Cellular LLC
Centennial Puerto Rico Cable TV Corp.
Centennial Puerto Rico Holding Corp. II
Centennial Puerto Rico License Corp.
Centennial Puerto Rico Operations Corp.
Centennial Xxxxxxxx Cellular LLC
Centennial Xxxxxxxx Holding Corp.
Centennial Southeast License Co. LLC
Centennial SVLP LLC
Centennial USVI Operations Corp.
Century Beaumont Cellular Corp.
Century Cellular Realty Corp.
Century Elkhart Cellular Corp.
Century Indiana Cellular Corp.
Century Michiana Cellular Corp.
Century Michigan Cellular Corp.
Century South Bend Cellular Corp.
Elkhart Cellular Telephone Company
Elkhart Metronet Inc.
Lafayette Cellular Telephone Company
Mega Comm LLC
Michigan Metronet Inc.
San Francisco Subsidiary Corp.
South Bend Metronet, Inc.
