CONFORMED COPY
GUARANTEE AND COLLATERAL AGREEMENT
made by
AUDIOVOX CORPORATION
and certain of its Subsidiaries
in favor of
JPMORGAN CHASE BANK,
as Administrative Agent
Dated as of July 15, 2004
Exhibit 99.2
Table of Contents
Page
Section 1. DEFINED TERMS...................................................................................1
1.1 Definitions.....................................................................................1
1.2 Other Definitional Provisions...................................................................3
Section 2. Guarantee.......................................................................................3
2.1 Guarantee.......................................................................................3
2.2 Right of Contribution...........................................................................4
2.3 No Subrogation..................................................................................4
2.4 Amendments, etc. with respect to the Borrower Obligations.......................................5
2.5 Guarantee Absolute and Unconditional............................................................5
2.6 Reinstatement...................................................................................6
2.7 Payments........................................................................................6
Section 3. GRANT OF SECURITY INTEREST......................................................................6
Section 4. REPRESENTATIONS AND WARRANTIES..................................................................7
4.1 Title; No Other Liens...........................................................................7
4.2 Perfected First Priority Liens..................................................................7
4.3 Jurisdiction of Organization; Chief Executive Office............................................7
4.4 Inventory.......................................................................................7
4.5 Farm Products...................................................................................7
4.6 Pledged Stock...................................................................................8
4.7 Accounts........................................................................................8
Section 5. COVENANTS.......................................................................................8
5.1 Delivery of Instruments, Certificated Securities and Chattel Paper..............................8
5.2 Maintenance of Insurance........................................................................8
5.3 Payment of Obligations..........................................................................9
5.4 Maintenance of Perfected Security Interest; Further Documentation...............................9
5.5 Changes in Name, etc............................................................................9
5.6 Notices.......................................................................................10
5.7 Pledged Stock..................................................................................10
Section 6. REMEDIAL PROVISIONS............................................................................11
6.1 Certain Matters Relating to Accounts...........................................................11
6.2 Communications with Obligors; Grantors Remain Liable...........................................11
6.3 Pledged Stock..................................................................................12
6.4 Proceeds to be Turned Over To Administrative Agent.............................................13
6.5 Application of Proceeds........................................................................13
6.6 Code and Other Remedies........................................................................14
6.7 Registration Rights............................................................................14
6.8 Deficiency.....................................................................................15
Section 7. THE ADMINISTRATIVE AGENT.......................................................................15
7.1 Administrative Agent's Appointment as Attorney-in-Fact, etc....................................15
7.2 Duty of Administrative Agent...................................................................17
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7.3 Execution of Financing Statements..............................................................17
7.4 Authority of Administrative Agent..............................................................17
Section 8. MISCELLANEOUS..................................................................................18
8.1 Amendments in Writing..........................................................................18
8.2 Notices........................................................................................18
8.3 No Waiver by Course of Conduct; Cumulative Remedies............................................18
8.4 Enforcement Expenses; Indemnification..........................................................18
8.5 Successors and Assigns.........................................................................19
8.6 Set-Off........................................................................................19
8.7 Counterparts...................................................................................19
8.8 Severability...................................................................................19
8.9 Section Headings...............................................................................19
8.10 Integration....................................................................................20
8.11 GOVERNING LAW..................................................................................20
8.12 Submission To Jurisdiction; Waivers............................................................20
8.13 Acknowledgements...............................................................................20
8.14 Additional Grantors............................................................................21
8.15 Releases.......................................................................................21
8.16 WAIVER OF JURY TRIAL...........................................................................21
8.17 Continuing Effect..............................................................................21
SCHEDULES
Schedule 1........Notice Addresses
Schedule 2........Pledged Stock
Schedule 3........Jurisdictions of Organization and Chief Executive Offices
Schedule 4........Inventory
ANNEXES
Annex 1 Assumption Agreement
Annex 2 Acknowledgement and Consent
ii
GUARANTEE AND COLLATERAL AGREEMENT
GUARANTEE AND COLLATERAL AGREEMENT, dated as of July 15, 2004, made by each
of the signatories hereto (together with any other entity that may become a
party hereto as provided herein, the "Grantors"), in favor of JPMorgan Chase
Bank, as Administrative Agent (in such capacity, the "Administrative Agent") for
the banks and other financial institutions or entities (the "Lenders") from time
to time parties to the Fifth Amended and Restated Credit Agreement, dated as of
July 15, 2004 (as amended, supplemented or otherwise modified from time to time,
the "Credit Agreement"), among Audiovox Corporation (the "Borrower"), the
Lenders and the Administrative Agent.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make extensions of credit to the Borrower upon the terms and subject
to the conditions set forth therein;
WHEREAS, the Borrower is a member of an affiliated group of companies that
includes each other Grantor;
WHEREAS, the proceeds of the extensions of credit under the Credit
Agreement will be used in part to enable the Borrower to make valuable transfers
to one or more of the other Grantors in connection with the operation of their
respective businesses;
WHEREAS, the Borrower and the other Grantors are engaged in related
businesses, and each Grantor will derive substantial direct and indirect benefit
from the making of the extensions of credit under the Credit Agreement; and
WHEREAS, it is a condition precedent to the amendment and restatement of
the Existing Credit Agreement (as defined in the Credit Agreement) and the
obligation of the Lenders to make their respective extensions of credit to the
Borrower under the Credit Agreement that the Grantors shall have executed and
delivered this Agreement to the Administrative Agent for the ratable benefit of
the Lenders pursuant to which the Security Documents (as defined in the Existing
Credit Agreement) which secure the Existing Credit Agreement will be amended and
restated and the Liens created thereby will continue to secure the Credit
Agreement;
NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the Borrower
thereunder, each Grantor hereby agrees with the Administrative Agent, for the
ratable benefit of the Lenders, as follows:
Section 1......... DEFINED TERMS
1.1 Definitions. (a) Unless otherwise defined herein, terms defined in the
Credit Agreement and used herein shall have the meanings given to them in the
Credit Agreement, and the following terms are used herein as defined in the New
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York UCC: Accounts, Certificated Security, Chattel Paper, Documents, Farm
Products, Instruments, Inventory and Supporting Obligations.
(b) The following terms shall have the following meanings:
"Agreement": this Guarantee and Collateral Agreement, as the same may be
amended, supplemented or otherwise modified from time to time.
"Borrower Obligations": the collective reference to the unpaid principal of
and interest on the Loans and Reimbursement Obligations and all other
obligations and liabilities of the Borrower (including, without limitation,
interest accruing at the then applicable rate provided in the Credit Agreement
after the maturity of the Loans and Reimbursement Obligations and interest
accruing at the then applicable rate provided in the Credit Agreement after the
filing of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Borrower, whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding)
to the Administrative Agent or any Lender (or, in the case of any Specified Swap
Agreement, any Affiliate of any Lender), whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, out of, or in connection with, the Credit Agreement, this
Agreement, the other Loan Documents, any Acceptance, any Letter of Credit, any
Specified Swap Agreement or any other document made, delivered or given in
connection with any of the foregoing, in each case whether on account of
principal, interest, reimbursement obligations, fees, indemnities, costs,
expenses or otherwise (including, without limitation, all fees and disbursements
of counsel to the Administrative Agent or to the Lenders that are required to be
paid by the Borrower pursuant to the terms of any of the foregoing agreements).
"Collateral": as defined in Section 3.
"Collateral Account": any collateral account established by the
Administrative Agent as provided in Section 6.1 or 6.4.
"Guarantor Obligations": with respect to any Guarantor, all obligations and
liabilities of such Guarantor which may arise under or in connection with this
Agreement (including, without limitation, Section 2) or any other Loan Document
to which such Guarantor is a party, in each case whether on account of guarantee
obligations, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of counsel
to the Administrative Agent or to the Lenders that are required to be paid by
such Guarantor pursuant to the terms of this Agreement or any other Loan
Document).
"Guarantors": the collective reference to each Grantor other than the
Borrower.
"Inventory Documents": as to any Person at any time, all Documents relating
to or evidencing the right to any Inventory of such Person at such time.
"Issuers": the collective reference to each issuer of any Pledged Stock.
"New York UCC": the Uniform Commercial Code as from time to time in effect
in the State of New York.
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"Obligations": (i) in the case of the Borrower, the Borrower Obligations,
and (ii) in the case of each Guarantor, its Guarantor Obligations.
"Pledged Stock": the shares of Capital Stock listed on Schedule 2, together
with any other shares of Capital Stock of any Wholly Owned Foreign Subsidiary
that is not a Grantor.
"Proceeds": all "proceeds" as such term is defined in Section 9-102(a)(64)
of the New York UCC and, in any event, shall include, without limitation, all
dividends or other income from the Pledged Stock, collections thereon or
distributions or payments with respect thereto.
"Securities Act": the Securities Act of 1933, as amended.
"Specified Swap Agreement": any Swap Agreement entered into by the Borrower
and any Lender or affiliate thereof in respect of interest rates or currency
exchange rates.
"Swap Agreement": any agreement with respect to any swap, forward, future
or derivative transaction or option or similar agreement involving, or settled
by reference to, one or more rates or currencies.
1.2 Other Definitional Provisions. (a) The words "hereof," "herein",
"hereto" and "hereunder" and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Section and Schedule references are to this Agreement unless
otherwise specified.
(b) The meanings given to terms defined herein shall be equally applicable
to both the singular and plural forms of such terms.
(c) Where the context requires, (i) terms relating to the Collateral or any
part thereof, when used in relation to a Grantor, shall refer to such Grantor's
Collateral or the relevant part thereof and (ii) the term "Lender" shall include
(A) any Affiliate of any Lender that is the holder of Borrower Obligations and
(B) the Administrative Agent.
Section 2......... Guarantee
2.1 Guarantee. (a) Each of the Guarantors hereby, jointly and severally,
unconditionally and irrevocably, guarantees to the Administrative Agent, for the
ratable benefit of the Lenders and their respective successors, indorsees,
transferees and assigns, the prompt and complete payment and performance by the
Borrower when due (whether at the stated maturity, by acceleration or otherwise)
of the Borrower Obligations.
(b) Anything herein or in any other Loan Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under the
other Loan Documents shall in no event exceed the amount which can be guaranteed
by such Guarantor under applicable federal and state laws relating to the
insolvency of debtors (after giving effect to the right of contribution
established in Section 2.2).
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(c) Each Guarantor agrees that the Borrower Obligations may at any time and
from time to time exceed the amount of the liability of such Guarantor hereunder
without impairing the guarantee contained in this Section 2 or affecting the
rights and remedies of the Administrative Agent or any Lender hereunder.
(d) The guarantee contained in this Section 2 shall remain in full force
and effect until all the Borrower Obligations and the obligations of each
Guarantor under the guarantee contained in this Section 2 shall have been
satisfied by payment in full, no Letter of Credit or Acceptance shall be
outstanding and the Commitments shall be terminated, notwithstanding that from
time to time during the term of the Credit Agreement the Borrower may be free
from any Borrower Obligations.
(e) No payment made by the Borrower, any of the Guarantors, any other
guarantor or any other Person or received or collected by the Administrative
Agent or any Lender from the Borrower, any of the Guarantors, any other
guarantor or any other Person by virtue of any action or proceeding or any
set-off or appropriation or application at any time or from time to time in
reduction of or in payment of the Borrower Obligations shall be deemed to
modify, reduce, release or otherwise affect the liability of any Guarantor
hereunder which shall, notwithstanding any such payment (other than any payment
made by such Guarantor in respect of the Borrower Obligations or any payment
received or collected from such Guarantor in respect of the Borrower
Obligations), remain liable for the Borrower Obligations up to the maximum
liability of such Guarantor hereunder until the Borrower Obligations are paid in
full, no Letter of Credit or Acceptance shall be outstanding and the Commitments
are terminated.
2.2 Right of Contribution. Each Guarantor hereby agrees that to the extent
that a Guarantor shall have paid more than its proportionate share of any
payment made hereunder, such Guarantor shall be entitled to seek and receive
contribution from and against any other Guarantor hereunder which has not paid
its proportionate share of such payment. Each Guarantor's right of contribution
shall be subject to the terms and conditions of Section 2.3. The provisions of
this Section 2.2 shall in no respect limit the obligations and liabilities of
any Guarantor to the Administrative Agent and the Lenders, and each Guarantor
shall remain liable to the Administrative Agent and the Lenders for the full
amount guaranteed by such Guarantor hereunder.
2.3 No Subrogation. Notwithstanding any payment made by any Guarantor
hereunder or any set-off or application of funds of any Guarantor by the
Administrative Agent or any Lender, no Guarantor shall be entitled to be
subrogated to any of the rights of the Administrative Agent or any Lender
against the Borrower or any other Guarantor or any collateral security or
guarantee or right of offset held by the Administrative Agent or any Lender for
the payment of the Borrower Obligations, nor shall any Guarantor seek or be
entitled to seek any contribution or reimbursement from the Borrower or any
other Guarantor in respect of payments made by such Guarantor hereunder, until
all amounts owing to the Administrative Agent and the Lenders by the Borrower on
account of the Borrower Obligations are paid in full, no Letter of Credit or
Acceptance shall be outstanding and the Commitments are terminated. If any
amount shall be paid to any Guarantor on account of such subrogation rights at
any time when all of the Borrower Obligations shall not have been paid in full,
such amount shall be held by such Guarantor in trust for the Administrative
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Agent and the Lenders, segregated from other funds of such Guarantor, and shall,
forthwith upon receipt by such Guarantor, be turned over to the Administrative
Agent in the exact form received by such Guarantor (duly indorsed by such
Guarantor to the Administrative Agent, if required), to be applied against the
Borrower Obligations, whether matured or unmatured, in such order as the
Administrative Agent may determine.
2.4 Amendments, etc. with respect to the Borrower Obligations . Each
Guarantor shall remain obligated hereunder notwithstanding that, without any
reservation of rights against any Guarantor and without notice to or further
assent by any Guarantor, any demand for payment of any of the Borrower
Obligations made by the Administrative Agent or any Lender may be rescinded by
the Administrative Agent or such Lender and any of the Borrower Obligations
continued, and the Borrower Obligations, or the liability of any other Person
upon or for any part thereof, or any collateral security or guarantee therefor
or right of offset with respect thereto, may, from time to time, in whole or in
part, be renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by the Administrative Agent or any Lender, and the
Credit Agreement and the other Loan Documents and any other documents executed
and delivered in connection therewith may be amended, modified, supplemented or
terminated, in whole or in part, as the Administrative Agent (or the Required
Lenders or all Lenders, as the case may be) may deem advisable from time to
time, and any collateral security, guarantee or right of offset at any time held
by the Administrative Agent or any Lender for the payment of the Borrower
Obligations may be sold, exchanged, waived, surrendered or released. Neither the
Administrative Agent nor any Lender shall have any obligation to protect,
secure, perfect or insure any Lien at any time held by it as security for the
Borrower Obligations or for the guarantee contained in this Section 2 or any
property subject thereto.
2.5 Guarantee Absolute and Unconditional. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of any of the Borrower
Obligations and notice of or proof of reliance by the Administrative Agent or
any Lender upon the guarantee contained in this Section 2 or acceptance of the
guarantee contained in this Section 2; the Borrower Obligations, and any of
them, shall conclusively be deemed to have been created, contracted or incurred,
or renewed, extended, amended or waived, in reliance upon the guarantee
contained in this Section 2; and all dealings between the Borrower and any of
the Guarantors, on the one hand, and the Administrative Agent and the Lenders,
on the other hand, likewise shall be conclusively presumed to have been had or
consummated in reliance upon the guarantee contained in this Section 2. Each
Guarantor waives diligence, presentment, protest, demand for payment and notice
of default or nonpayment to or upon the Borrower or any of the Guarantors with
respect to the Borrower Obligations. Each Guarantor understands and agrees that
the guarantee contained in this Section 2 shall be construed as a continuing,
absolute and unconditional guarantee of payment without regard to (a) the
validity or enforceability of the Credit Agreement or any other Loan Document,
any of the Borrower Obligations or any other collateral security therefor or
guarantee or right of offset with respect thereto at any time or from time to
time held by the Administrative Agent or any Lender, (b) any defense, set-off or
counterclaim (other than a defense of payment or performance) which may at any
time be available to or be asserted by the Borrower or any other Person against
the Administrative Agent or any Lender, or (c) any other circumstance whatsoever
(with or without notice to or knowledge of the Borrower or such Guarantor) which
constitutes, or might be construed to constitute, an equitable or legal
discharge of the Borrower for the Borrower Obligations, or of such Guarantor
under the guarantee contained in this Section 2, in bankruptcy or in any other
instance. When making any demand hereunder or otherwise pursuing its rights and
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remedies hereunder against any Guarantor, the Administrative Agent or any Lender
may, but shall be under no obligation to, make a similar demand on or otherwise
pursue such rights and remedies as it may have against the Borrower, any other
Guarantor or any other Person or against any collateral security or guarantee
for the Borrower Obligations or any right of offset with respect thereto, and
any failure by the Administrative Agent or any Lender to make any such demand,
to pursue such other rights or remedies or to collect any payments from the
Borrower, any other Guarantor or any other Person or to realize upon any such
collateral security or guarantee or to exercise any such right of offset, or any
release of the Borrower, any other Guarantor or any other Person or any such
collateral security, guarantee or right of offset, shall not relieve any
Guarantor of any obligation or liability hereunder, and shall not impair or
affect the rights and remedies, whether express, implied or available as a
matter of law, of the Administrative Agent or any Lender against any Guarantor.
For the purposes hereof "demand" shall include the commencement and continuance
of any legal proceedings.
2.6 Reinstatement. The guarantee contained in this Section 2 shall continue
to be effective, or be reinstated, as the case may be, if at any time payment,
or any part thereof, of any of the Borrower Obligations is rescinded or must
otherwise be restored or returned by the Administrative Agent or any Lender upon
the insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Borrower or any Guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, the
Borrower or any Guarantor or any substantial part of its property, or otherwise,
all as though such payments had not been made.
2.7 Payments. Each Guarantor hereby guarantees that payments hereunder will
be paid to the Administrative Agent without set-off or counterclaim in Dollars
at the Funding Office.
Section 3......... GRANT OF SECURITY INTEREST
Each Grantor hereby assigns and transfers to the Administrative Agent, and
hereby grants to the Administrative Agent, for the ratable benefit of the
Lenders, a security interest in, all of the following property now owned or at
any time hereafter acquired by such Grantor or in which such Grantor now has or
at any time in the future may acquire any right, title or interest
(collectively, the "Collateral"), as collateral security for the prompt and
complete payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of such Grantor's Obligations,:
(a) all Accounts;
(b) all Inventory;
(c) all Inventory Documents;
(d) all Pledged Stock;
(e) all books and records pertaining to the Collateral; and
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(f) to the extent not otherwise included, all Proceeds, Supporting
Obligations and products of any and all of the foregoing and all collateral
security and guarantees given by any Person with respect to any of the
foregoing;
provided, however, that notwithstanding any of the other provisions set
forth in this Section 3, this Agreement shall not constitute a grant of a
security interest in any property to the extent that such grant of a security
interest is prohibited by any Requirements of Law of a Governmental Authority,
requires a consent not obtained of any Governmental Authority pursuant to such
Requirement of Law, except to the extent that such Requirement of Law is
ineffective under applicable law.
Section 4......... REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into the Credit
Agreement and to induce the Lenders to make their respective extensions of
credit to the Borrower thereunder, each Grantor hereby represents and warrants
to the Administrative Agent and each Lender that:
4.1 Title; No Other Liens. Except for the security interest granted to the
Administrative Agent for the ratable benefit of the Lenders pursuant to this
Agreement and the other Liens permitted to exist on the Collateral by the Credit
Agreement, such Grantor owns each item of the Collateral free and clear of any
and all Liens or claims of others. No financing statement or other public notice
with respect to all or any part of the Collateral is on file or of record in any
public office, except such as have been filed in favor of the Administrative
Agent, for the ratable benefit of the Lenders, pursuant to this Agreement or as
are permitted by the Credit Agreement.
4.2 Perfected First Priority Liens . The security interests granted
pursuant to this Agreement (a) constitute valid perfected security interests in
all of the Collateral in favor of the Administrative Agent, for the ratable
benefit of the Lenders, as collateral security for such Grantor's Obligations,
enforceable in accordance with the terms hereof against all creditors of such
Grantor and any Persons purporting to purchase any Collateral from such Grantor
and (b) are prior to all other Liens on the Collateral in existence on the date
hereof except for unrecorded Liens permitted by the Credit Agreement which have
priority over the Liens on the Collateral by operation of law.
4.3 Jurisdiction of Organization; Chief Executive Office. On the date
hereof, such Grantor's jurisdiction of organization, identification number from
the jurisdiction of organization (if any), and the location of such Grantor's
chief executive office or sole place of business, as the case may be, are
specified on Schedule 3. Such Grantor has furnished to the Administrative Agent
a certified charter, certificate of incorporation or other organization document
and short-form good standing certificate as of a date which is recent to the
date hereof.
4.4 Inventory. On the date hereof, such Grantor's Inventory is kept at the
locations listed on Schedule 4.
4.5 Farm Products. None of such Grantor's Collateral constitutes, or is the
Proceeds of, Farm Products.
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4.6 Pledged Stock. (a) The shares of Pledged Stock pledged by such Grantor
hereunder constitute all the issued and outstanding shares of all classes of the
Capital Stock of each Issuer owned by such Grantor.
(b) All the shares of the Pledged Stock have been duly and validly issued
and are fully paid and nonassessable.
(c) Such Grantor is the record and beneficial owner of, and has good and
marketable title to, the Pledged Stock pledged by it hereunder, free of any and
all Liens or options in favor of, or claims of, any other Person, except the
security interest created by this Agreement.
4.7 Accounts. (a) No amount payable to such Grantor under or in connection
with any Account is evidenced by any Instrument or Chattel Paper which has not
been delivered to the Administrative Agent.
(b) None of the obligors on any Accounts is a Governmental Authority.
(c) The amounts represented by such Grantor to the Lenders from time to
time as owing to such Grantor in respect of the Accounts will at such times be
accurate.
Section 5......... COVENANTS
Each Grantor covenants and agrees with the Administrative Agent and the
Lenders that, from and after the date of this Agreement until the Obligations
shall have been paid in full, no Letter of Credit or Acceptance shall be
outstanding and the Commitments shall have terminated:
5.1 Delivery of Instruments, Certificated Securities and Chattel Paper. If
any amount payable under or in connection with any of the Collateral shall be or
become evidenced by any Instrument, Certificated Security or Chattel Paper, such
Instrument, Certificated Security or Chattel Paper shall be immediately
delivered to the Administrative Agent, duly indorsed in a manner satisfactory to
the Administrative Agent, to be held as Collateral pursuant to this Agreement.
5.2......Maintenance of Insurance. (a) Such Grantor will maintain, with
financially sound and reputable companies, insurance policies (i) insuring the
Inventory against loss by fire, explosion, theft and such other casualties as
may be reasonably satisfactory to the Administrative Agent and (ii) to the
extent requested by the Administrative Agent, insuring such Grantor, the
Administrative Agent and the Lenders against liability for personal injury and
property damage relating to such Inventory, such policies to be in such form and
amounts and having such coverage as may be reasonably satisfactory to the
Administrative Agent and the Lenders.
(b) All such insurance shall (i) provide that no cancellation, material
reduction in amount or material change in coverage thereof shall be effective
until at least 30 days after receipt by the Administrative Agent of written
notice thereof, (ii) name the Administrative Agent as insured party or loss
payee, (iii) if reasonably requested by the Administrative Agent, include a
breach of warranty clause and (iv) be reasonably satisfactory in all other
respects to the Administrative Agent.
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(c) The Borrower shall deliver to the Administrative Agent and the Lenders
a report of a reputable insurance broker with respect to such insurance
substantially concurrently with each delivery of the Borrower's audited annual
financial statements and such supplemental reports with respect thereto as the
Administrative Agent may from time to time reasonably request.
5.3......Payment of Obligations. Such Grantor will pay and discharge or
otherwise satisfy at or before maturity or before they become delinquent, as the
case may be, all taxes, assessments and governmental charges or levies imposed
upon the Collateral or in respect of income or profits therefrom, as well as all
claims of any kind (including, without limitation, claims for labor, materials
and supplies) against or with respect to the Collateral, except that no such
charge need be paid if the amount or validity thereof is currently being
contested in good faith by appropriate proceedings, reserves in conformity with
GAAP with respect thereto have been provided on the books of such Grantor and
such proceedings could not reasonably be expected to result in the sale,
forfeiture or loss of any material portion of the Collateral or any interest
therein.
5.4 Maintenance of Perfected Security Interest; Further Documentation. (a)
Such Grantor shall maintain the security interest created by this Agreement as a
perfected security interest having at least the priority described in Section
4.2 and shall defend such security interest against the claims and demands of
all Persons whomsoever, subject to the rights of such Grantor under the Loan
Documents to dispose of the Collateral.
(b) Such Grantor will furnish to the Administrative Agent and the Lenders
from time to time statements and schedules further identifying and describing
the assets and property of such Grantor and such other reports in connection
therewith as the Administrative Agent may reasonably request, all in reasonable
detail.
(c) At any time and from time to time, upon the written request of the
Administrative Agent, and at the sole expense of such Grantor, such Grantor will
promptly and duly execute and deliver, and have recorded, such further
instruments and documents and take such further actions as the Administrative
Agent may reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted,
including, without limitation, (i) filing any financing or continuation
statements under the Uniform Commercial Code (or other similar laws) in effect
in any jurisdiction with respect to the security interests created hereby and
(ii) in the case of Pledged Stock and any other relevant Collateral, taking any
actions necessary to enable the Administrative Agent to obtain "control" (within
the meaning of the applicable Uniform Commercial Code) with respect thereto.
5.5 Changes in Name, etc. Such Grantor will not, except upon 15 days' prior
written notice to the Administrative Agent and delivery to the Administrative
Agent of all additional executed financing statements and other documents
reasonably requested by the Administrative Agent to maintain the validity,
perfection and priority of the security interests provided for herein, (i)
change its jurisdiction of organization or the location of its chief executive
office or sole place of business or principal residence from that referred to in
Section 4.3 or (ii) change its name.
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5.6 .........Notices. Such Grantor will advise the Administrative Agent and
the Lenders promptly, in reasonable detail, of:
(a) any Lien (other than security interests created hereby or Liens
permitted under the Credit Agreement) on any of the Collateral which would
adversely affect the ability of the Administrative Agent to exercise any of its
remedies hereunder; and
(b) of the occurrence of any other event which could reasonably be expected
to have a material adverse effect on the aggregate value of the Collateral or on
the security interests created hereby.
5.7 Pledged Stock. (a) If such Grantor shall become entitled to receive or
shall receive any certificate (including, without limitation, any certificate
representing a dividend or a distribution in connection with any
reclassification, increase or reduction of capital or any certificate issued in
connection with any reorganization), option or rights in respect of the Capital
Stock of any Issuer, whether in addition to, in substitution of, as a conversion
of, or in exchange for, any shares of the Pledged Stock, or otherwise in respect
thereof, such Grantor shall accept the same as the agent of the Administrative
Agent and the Lenders, hold the same in trust for the Administrative Agent and
the Lenders and deliver the same forthwith to the Administrative Agent in the
exact form received, duly indorsed by such Grantor to the Administrative Agent,
if required, together with an undated stock power covering such certificate duly
executed in blank by such Grantor and with, if the Administrative Agent so
requests, signature guaranteed, to be held by the Administrative Agent, subject
to the terms hereof, as additional collateral security for the Obligations. Any
sums paid upon or in respect of the Pledged Stock upon the liquidation or
dissolution of any Issuer shall be paid over to the Administrative Agent to be
held by it hereunder as additional collateral security for the Obligations, and
in case any distribution of capital shall be made on or in respect of the
Pledged Stock or any property shall be distributed upon or with respect to the
Pledged Stock pursuant to the recapitalization or reclassification of the
capital of any Issuer or pursuant to the reorganization thereof, the property so
distributed shall, unless otherwise subject to a perfected security interest in
favor of the Administrative Agent, be delivered to the Administrative Agent to
be held by it hereunder as additional collateral security for the Obligations.
If any sums of money or property so paid or distributed in respect of the
Pledged Stock shall be received by such Grantor, such Grantor shall, until such
money or property is paid or delivered to the Administrative Agent, hold such
money or property in trust for the Administrative Agent and the Lenders,
segregated from other funds of such Grantor, as additional collateral security
for the Obligations.
(b) Without the prior written consent of the Administrative Agent, such
Grantor will not (i) vote to enable, or take any other action to permit, any
Issuer to issue any Capital Stock of any nature or to issue any other securities
convertible into or granting the right to purchase or exchange for any Capital
Stock of any nature of any Issuer, (ii) sell, assign, transfer, exchange, or
otherwise dispose of, or grant any option with respect to, the Pledged Stock or
Proceeds thereof (except pursuant to a transaction expressly permitted by the
Credit Agreement), (iii) create, incur or permit to exist any Lien or option in
favor of, or any claim of any Person with respect to, any of the Pledged Stock
or Proceeds thereof, or any interest therein, except for the security interests
created by this Agreement or (iv) enter into any agreement or undertaking
restricting the right or ability of such Grantor or the Administrative Agent to
sell, assign or transfer any of the Pledged Stock or Proceeds thereof.
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(c) In the case of each Grantor which is an Issuer, such Issuer agrees that
(i) it will be bound by the terms of this Agreement relating to the Pledged
Stock issued by it and will comply with such terms insofar as such terms are
applicable to it, (ii) it will notify the Administrative Agent promptly in
writing of the occurrence of any of the events described in Section 5.7(a) with
respect to the Pledged Stock issued by it and (iii) the terms of Sections 6.3(c)
and 6.7 shall apply to it, mutatis mutandis, with respect to all actions that
may be required of it pursuant to Section 6.3(c) or 6.7 with respect to the
Pledged Stock issued by it.
Section 6......... REMEDIAL PROVISIONS
6.1 Certain Matters Relating to Accounts. (a) The Administrative Agent
shall have the right to make test verifications of the Accounts in any manner
and through any medium that it reasonably considers advisable, and each Grantor
shall furnish all such assistance and information as the Administrative Agent
may require in connection with such test verifications. At any time and from
time to time, upon the Administrative Agent's request and at the expense of the
relevant Grantor, such Grantor shall cause independent public accountants or
others satisfactory to the Administrative Agent to furnish to the Administrative
Agent reports showing reconciliations, aging and test verifications of, and
trial balances for, the Accounts.
(b) The Administrative Agent hereby authorizes each Grantor to collect such
Grantor's Accounts, subject to the Administrative Agent's direction and control,
and the Administrative Agent may curtail or terminate said authority at any time
after the occurrence and during the continuance of an Event of Default. If
required by the Administrative Agent at any time after the occurrence and during
the continuance of an Event of Default, any payments of Accounts, when collected
by any Grantor, (i) shall be forthwith (and, in any event, within two Business
Days) deposited by such Grantor in the exact form received, duly indorsed by
such Grantor to the Administrative Agent if required, in a Collateral Account
maintained under the sole dominion and control of the Administrative Agent,
subject to withdrawal by the Administrative Agent for the account of the Lenders
only as provided in Section 6.5, and (ii) until so turned over, shall be held by
such Grantor in trust for the Administrative Agent and the Lenders, segregated
from other funds of such Grantor. Each such deposit of Proceeds of Accounts
shall be accompanied by a report identifying in reasonable detail the nature and
source of the payments included in the deposit.
(c) At the Administrative Agent's request, each Grantor shall deliver to
the Administrative Agent all original and other documents evidencing, and
relating to, the agreements and transactions which gave rise to the Accounts,
including, without limitation, all original orders, invoices and shipping
receipts.
6.2 Communications with Obligors; Grantors Remain Liable. (a) The
Administrative Agent in its own name or in the name of others may at any time
communicate with obligors under the Accounts to verify with them to the
Administrative Agent's satisfaction the existence, amount and terms of any
Accounts.
(b) Upon the request of the Administrative Agent at any time after the
occurrence and during the continuance of an Event of Default, each Grantor shall
notify obligors on the Accounts that the Accounts have been assigned to the
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Administrative Agent for the ratable benefit of the Lenders and that payments in
respect thereof shall be made directly to the Administrative Agent.
(c) Anything herein to the contrary notwithstanding, each Grantor shall
remain liable under each of the Accounts to observe and perform all the
conditions and obligations to be observed and performed by it thereunder, all in
accordance with the terms of any agreement giving rise thereto. Neither the
Administrative Agent nor any Lender shall have any obligation or liability under
any Account (or any agreement giving rise thereto) by reason of or arising out
of this Agreement or the receipt by the Administrative Agent or any Lender of
any payment relating thereto, nor shall the Administrative Agent or any Lender
be obligated in any manner to perform any of the obligations of any Grantor
under or pursuant to any Account (or any agreement giving rise thereto), to make
any payment, to make any inquiry as to the nature or the sufficiency of any
payment received by it or as to the sufficiency of any performance by any party
thereunder, to present or file any claim, to take any action to enforce any
performance or to collect the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.
6.3 Pledged Stock. (a) Unless an Event of Default shall have occurred and
be continuing and the Administrative Agent shall have given notice to the
relevant Grantor of the Administrative Agent's intent to exercise its
corresponding rights pursuant to Section 6.3(b), each Grantor shall be permitted
to receive all cash dividends paid in respect of the Pledged Stock, paid in the
normal course of business of the relevant Issuer and consistent with past
practice, to the extent permitted in the Credit Agreement, and to exercise all
voting and corporate or other organizational rights with respect to the Pledged
Stock; provided, however, that no vote shall be cast or corporate or other
organizational right exercised or other action taken which, in the
Administrative Agent's reasonable judgment, would impair the Collateral or which
would be inconsistent with or result in any violation of any provision of the
Credit Agreement, this Agreement or any other Loan Document.
(b) If an Event of Default shall occur and be continuing and the
Administrative Agent shall give notice of its intent to exercise such rights to
the relevant Grantor or Grantors, (i) the Administrative Agent shall have the
right to receive any and all cash dividends, payments or other Proceeds paid in
respect of the Pledged Stock and make application thereof to the Obligations in
such order as the Administrative Agent may determine, and (ii) any or all of the
Pledged Stock shall be registered in the name of the Administrative Agent or its
nominee, and the Administrative Agent or its nominee may thereafter exercise (x)
all voting, corporate and other rights pertaining to such Pledged Stock at any
meeting of shareholders of the relevant Issuer or Issuers or otherwise and (y)
any and all rights of conversion, exchange and subscription and any other
rights, privileges or options pertaining to such Pledged Stock as if it were the
absolute owner thereof (including, without limitation, the right to exchange at
its discretion any and all of the Pledged Stock upon the merger, consolidation,
reorganization, recapitalization or other fundamental change in the corporate or
other organizational structure of any Issuer, or upon the exercise by any
Grantor or the Administrative Agent of any right, privilege or option pertaining
to such Pledged Stock, and in connection therewith, the right to deposit and
deliver any and all of the Pledged Stock with any committee, depositary,
transfer agent, registrar or other designated agency upon such terms and
conditions as the Administrative Agent may determine), all without liability
except to account for property actually received by it, but the Administrative
Agent shall have no duty to any Grantor to exercise any such right, privilege or
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option and shall not be responsible for any failure to do so or delay in so
doing.
(c) Each Grantor hereby authorizes and instructs each Issuer of any Pledged
Stock pledged by such Grantor hereunder to (i) comply with any instruction
received by it from the Administrative Agent in writing that (x) states that an
Event of Default has occurred and is continuing and (y) is otherwise in
accordance with the terms of this Agreement, without any other or further
instructions from such Grantor, and each Grantor agrees that each Issuer shall
be fully protected in so complying, and (ii) unless otherwise expressly
permitted hereby, pay any dividends or other payments with respect to the
Pledged Stock directly to the Administrative Agent.
6.4 Proceeds to be Turned Over To Administrative Agent. In addition to the
rights of the Administrative Agent and the Lenders specified in Section 6.1 with
respect to payments of Accounts, if an Event of Default shall occur and be
continuing, all Proceeds received by any Grantor consisting of cash, checks and
other near-cash items shall be held by such Grantor in trust for the
Administrative Agent and the Lenders, segregated from other funds of such
Grantor, and shall, forthwith upon receipt by such Grantor, be turned over to
the Administrative Agent in the exact form received by such Grantor (duly
indorsed by such Grantor to the Administrative Agent, if required). All Proceeds
received by the Administrative Agent hereunder shall be held by the
Administrative Agent in a Collateral Account maintained under its sole dominion
and control. All Proceeds while held by the Administrative Agent in a Collateral
Account (or by such Grantor in trust for the Administrative Agent and the
Lenders) shall continue to be held as collateral security for all the
Obligations and shall not constitute payment thereof until applied as provided
in Section 6.5.
6.5 Application of Proceeds. At such intervals as may be agreed upon by the
Borrower and the Administrative Agent, or, if an Event of Default shall have
occurred and be continuing, at any time at the Administrative Agent's election,
the Administrative Agent may apply all or any part of Proceeds constituting
Collateral, whether or not held in any Collateral Account, and any proceeds of
the guarantee set forth in Section 2, in payment of the Obligations in the
following order:
First, to pay incurred and unpaid fees and expenses of the
Administrative Agent under the Loan Documents;
Second, to the Administrative Agent, for application by it towards
payment of amounts then due and owing and remaining unpaid in respect of
the Obligations, pro rata among the Lenders according to the amounts of the
Obligations then due and owing and remaining unpaid to the Lenders;
Third, to the Administrative Agent, for application by it towards
prepayment of the Obligations, pro rata among the Lenders according to the
amounts of the Obligations then held by the Lenders; and
Fourth, any balance remaining after the Obligations shall have been
paid in full, no Letters of Credit or Acceptances shall be outstanding and
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the Commitments shall have terminated shall be paid over to the Borrower or
to whomsoever may be lawfully entitled to receive the same.
6.6 Code and Other Remedies. If an Event of Default shall occur and be
continuing, the Administrative Agent, on behalf of the Lenders, may exercise, in
addition to all other rights and remedies granted to them in this Agreement and
in any other instrument or agreement securing, evidencing or relating to the
Obligations, all rights and remedies of a secured party under the New York UCC
or any other applicable law. Without limiting the generality of the foregoing,
the Administrative Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon any Grantor or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith sell,
lease, assign, give option or options to purchase, or otherwise dispose of and
deliver the Collateral or any part thereof (or contract to do any of the
foregoing), in one or more parcels at public or private sale or sales, at any
exchange, broker's board or office of the Administrative Agent or any Lender or
elsewhere upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for cash or on credit or for future delivery without
assumption of any credit risk. The Administrative Agent or any Lender shall have
the right upon any such public sale or sales, and, to the extent permitted by
law, upon any such private sale or sales, to purchase the whole or any part of
the Collateral so sold, free of any right or equity of redemption in any
Grantor, which right or equity is hereby waived and released. Each Grantor
further agrees, at the Administrative Agent's request, to assemble the
Collateral and make it available to the Administrative Agent at places which the
Administrative Agent shall reasonably select, whether at such Grantor's premises
or elsewhere. The Administrative Agent shall apply the net proceeds of any
action taken by it pursuant to this Section 6.6, after deducting all reasonable
costs and expenses of every kind incurred in connection therewith or incidental
to the care or safekeeping of any of the Collateral or in any way relating to
the Collateral or the rights of the Administrative Agent and the Lenders
hereunder, including, without limitation, reasonable attorneys' fees and
disbursements, to the payment in whole or in part of the Obligations, in such
order as the Administrative Agent may elect, and only after such application and
after the payment by the Administrative Agent of any other amount required by
any provision of law, including, without limitation, Section 9-615(a)(3) of the
New York UCC, need the Administrative Agent account for the surplus, if any, to
any Grantor. To the extent permitted by applicable law, each Grantor waives all
claims, damages and demands it may acquire against the Administrative Agent or
any Lender arising out of the exercise by them of any rights hereunder. If any
notice of a proposed sale or other disposition of Collateral shall be required
by law, such notice shall be deemed reasonable and proper if given at least 10
days before such sale or other disposition.
6.7 Registration Rights. (a) If the Administrative Agent shall determine to
exercise its right to sell any or all of the Pledged Stock pursuant to Section
6.6, and if in the opinion of the Administrative Agent it is necessary or
advisable to have the Pledged Stock, or that portion thereof to be sold,
registered under the provisions of the Securities Act, the relevant Grantor will
cause the Issuer thereof to (i) execute and deliver, and cause the directors and
officers of such Issuer to execute and deliver, all such instruments and
documents, and do or cause to be done all such other acts as may be, in the
opinion of the Administrative Agent, necessary or advisable to register the
Pledged Stock, or that portion thereof to be sold, under the provisions of the
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Securities Act, (ii) use its best efforts to cause the registration statement
relating thereto to become effective and to remain effective for a period of one
year from the date of the first public offering of the Pledged Stock, or that
portion thereof to be sold, and (iii) make all amendments thereto and/or to the
related prospectus which, in the opinion of the Administrative Agent, are
necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and Exchange
Commission applicable thereto. Each Grantor agrees to cause such Issuer to
comply with the provisions of the securities or "Blue Sky" laws of any and all
jurisdictions which the Administrative Agent shall designate and to make
available to its security holders, as soon as practicable, an earnings statement
(which need not be audited) which will satisfy the provisions of Section 11(a)
of the Securities Act. (b) Each Grantor recognizes that the Administrative Agent
may be unable to effect a public sale of any or all the Pledged Stock, by reason
of certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers which will be obliged
to agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof. Each
Grantor acknowledges and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The Administrative
Agent shall be under no obligation to delay a sale of any of the Pledged Stock
for the period of time necessary to permit the Issuer thereof to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if such Issuer would agree to do so.
(c) Each Grantor agrees to use its best efforts to do or cause to be done
all such other acts as may be necessary to make such sale or sales of all or any
portion of the Pledged Stock pursuant to this Section 6.7 valid and binding and
in compliance with any and all other applicable Requirements of Law. Each
Grantor further agrees that a breach of any of the covenants contained in this
Section 6.7 will cause irreparable injury to the Administrative Agent and the
Lenders, that the Administrative Agent and the Lenders have no adequate remedy
at law in respect of such breach and, as a consequence, that each and every
covenant contained in this Section 6.7 shall be specifically enforceable against
such Grantor, and such Grantor hereby waives and agrees not to assert any
defenses against an action for specific performance of such covenants except for
a defense that no Event of Default has occurred under the Credit Agreement.
6.8 Deficiency. Each Grantor shall remain liable for any deficiency if the
proceeds of any sale or other disposition of the Collateral are insufficient to
pay its Obligations and the fees and disbursements of any attorneys employed by
the Administrative Agent or any Lender to collect such deficiency.
Section 7......... THE ADMINISTRATIVE AGENT
7.1 Administrative Agent's Appointment as Attorney-in-Fact, etc. (a) Each
Grantor hereby irrevocably constitutes and appoints the Administrative Agent and
any officer or agent thereof, with full power of substitution, as its true and
lawful attorney-in-fact with full irrevocable power and authority in the place
and stead of such Grantor and in the name of such Grantor or in its own name,
16
for the purpose of carrying out the terms of this Agreement, to take any and all
appropriate action and to execute any and all documents and instruments which
may be necessary or desirable to accomplish the purposes of this Agreement, and,
without limiting the generality of the foregoing, each Grantor hereby gives the
Administrative Agent the power and right, on behalf of such Grantor, without
notice to or assent by such Grantor, to do any or all of the following:
(i) in the name of such Grantor or its own name, or otherwise, take
possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under any
Account or with respect to any other Collateral and file any claim or take
any other action or proceeding in any court of law or equity or otherwise
deemed appropriate by the Administrative Agent for the purpose of
collecting any and all such moneys due under any Account or with respect to
any other Collateral whenever payable;
(ii) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral, effect any repairs or any insurance
called for by the terms of this Agreement and pay all or any part of the
premiums therefor and the costs thereof;
(iii)execute, in connection with any sale provided for in Section 6.6
or 6.7, any indorsements, assignments or other instruments of conveyance or
transfer with respect to the Collateral; and
(iv) (1) direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Administrative Agent or as the Administrative
Agent shall direct; (2) ask or demand for, collect, and receive payment of
and receipt for, any and all moneys, claims and other amounts due or to
become due at any time in respect of or arising out of any Collateral; (3)
sign and indorse any invoices, freight or express bills, bills of lading,
storage or warehouse receipts, drafts against debtors, assignments,
verifications, notices and other documents in connection with any of the
Collateral; (4) commence and prosecute any suits, actions or proceedings at
law or in equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in respect
of any Collateral; (5) defend any suit, action or proceeding brought
against such Grantor with respect to any Collateral; (6) settle, compromise
or adjust any such suit, action or proceeding and, in connection therewith,
give such discharges or releases as the Administrative Agent may deem
appropriate; and (7) generally, sell, transfer, pledge and make any
agreement with respect to or otherwise deal with any of the Collateral as
fully and completely as though the Administrative Agent were the absolute
owner thereof for all purposes, and do, at the Administrative Agent's
option and such Grantor's expense, at any time, or from time to time, all
acts and things which the Administrative Agent deems necessary to protect,
preserve or realize upon the Collateral and the Administrative Agent's and
the Lenders' security interests therein and to effect the intent of this
Agreement, all as fully and effectively as such Grantor might do.
Anything in this Section 7.1(a) to the contrary notwithstanding, the
Administrative Agent agrees that it will not exercise any rights under the power
of attorney provided for in this Section 7.1(a) unless an Event of Default shall
have occurred and be continuing.
17
(b) If any Grantor fails to perform or comply with any of its agreements
contained herein, the Administrative Agent, at its option, but without any
obligation so to do, may perform or comply, or otherwise cause performance or
compliance, with such agreement.
(c) The expenses of the Administrative Agent incurred in connection with
actions undertaken as provided in this Section 7.1, together with interest
thereon at a rate per annum equal to the highest rate per annum at which
interest would then be payable on any category of past due Base Rate Loans under
the Credit Agreement, from the date of payment by the Administrative Agent to
the date reimbursed by the relevant Grantor, shall be payable by such Grantor to
the Administrative Agent on demand.
(d) Each Grantor hereby ratifies all that said attorneys shall lawfully do
or cause to be done by virtue hereof. All powers, authorizations and agencies
contained in this Agreement are coupled with an interest and are irrevocable
until this Agreement is terminated and the security interests created hereby are
released.
7.2 Duty of Administrative Agent. The Administrative Agent's sole duty with
respect to the custody, safekeeping and physical preservation of the Collateral
in its possession, under Section 9-207 of the New York UCC or otherwise, shall
be to deal with it in the same manner as the Administrative Agent deals with
similar property for its own account. Neither the Administrative Agent, any
Lender nor any of their respective officers, directors, employees or agents
shall be liable for failure to demand, collect or realize upon any of the
Collateral or for any delay in doing so or shall be under any obligation to sell
or otherwise dispose of any Collateral upon the request of any Grantor or any
other Person or to take any other action whatsoever with regard to the
Collateral or any part thereof. The powers conferred on the Administrative Agent
and the Lenders hereunder are solely to protect the Administrative Agent's and
the Lenders' interests in the Collateral and shall not impose any duty upon the
Administrative Agent or any Lender to exercise any such powers. The
Administrative Agent and the Lenders shall be accountable only for amounts that
they actually receive as a result of the exercise of such powers, and neither
they nor any of their officers, directors, employees or agents shall be
responsible to any Grantor for any act or failure to act hereunder, except for
their own gross negligence or willful misconduct.
7.3 Execution of Financing Statements. Pursuant to any applicable law, each
Grantor authorizes the Administrative Agent to file or record financing
statements and other filing or recording documents or instruments with respect
to the Collateral without the signature of such Grantor in such form and in such
offices as the Administrative Agent determines appropriate to perfect the
security interests of the Administrative Agent under this Agreement. Each
Grantor authorizes the Administrative Agent to use the collateral description
"all personal property" in any such financing statements. Each Grantor hereby
ratifies and authorizes the filing by the Administrative Agent of any financing
statement with respect to the Collateral made prior to the date hereof.
7.4 Authority of Administrative Agent. Each Grantor acknowledges that the
rights and responsibilities of the Administrative Agent under this Agreement
with respect to any action taken by the Administrative Agent or the exercise or
non-exercise by the Administrative Agent of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising
out of this Agreement shall, as between the Administrative Agent and the
18
Lenders, be governed by the Credit Agreement and by such other agreements with
respect thereto as may exist from time to time among them, but, as between the
Administrative Agent and the Grantors, the Administrative Agent shall be
conclusively presumed to be acting as agent for the Lenders with full and valid
authority so to act or refrain from acting, and no Grantor shall be under any
obligation, or entitlement, to make any inquiry respecting such authority.
Section 8. MISCELLANEOUS
8.1 Amendments in Writing. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except in
accordance with Section 13.1 of the Credit Agreement.
8.2 Notices. All notices, requests and demands to or upon the
Administrative Agent or any Grantor hereunder shall be effected in the manner
provided for in Section 13.2 of the Credit Agreement; provided that any such
notice, request or demand to or upon any Guarantor shall be addressed to such
Guarantor at its notice address set forth on Schedule 1.
8.3 No Waiver by Course of Conduct; Cumulative Remedies. Neither the
Administrative Agent nor any Lender shall by any act (except by a written
instrument pursuant to Section 8.1), delay, indulgence, omission or otherwise be
deemed to have waived any right or remedy hereunder or to have acquiesced in any
Default or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
power or privilege hereunder shall operate as a waiver thereof. No single or
partial exercise of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Administrative Agent or any Lender of any right or
remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which the Administrative Agent or such Lender would otherwise
have on any future occasion. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other rights or remedies provided by law.
8.4 Enforcement Expenses; Indemnification. (a) Each Guarantor agrees to pay
or reimburse each Lender and the Administrative Agent for all its costs and
expenses incurred in collecting against such Guarantor under the guarantee
contained in Section 2 or otherwise enforcing or preserving any rights under
this Agreement and the other Loan Documents to which such Guarantor is a party,
including, without limitation, the fees and disbursements of counsel (including
the allocated fees and expenses of in-house counsel) to each Lender and of
counsel to the Administrative Agent.
(b) Each Guarantor agrees to pay, and to save the Administrative Agent and
the Lenders harmless from, any and all liabilities with respect to, or resulting
from any delay in paying, any and all stamp, excise, sales or other taxes which
may be payable or determined to be payable with respect to any of the Collateral
or in connection with any of the transactions contemplated by this Agreement.
(c) Each Guarantor agrees to pay, and to save the Administrative Agent and
the Lenders harmless from, any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect to the execution, delivery,
19
enforcement, performance and administration of this Agreement to the extent the
Borrower would be required to do so pursuant to Section 13.5 of the Credit
Agreement.
(d) The agreements in this Section 8.4 shall survive repayment of the
Obligations and all other amounts payable under the Credit Agreement and the
other Loan Documents.
8.5 Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of each Grantor and shall inure to the benefit of the
Administrative Agent and the Lenders and their successors and assigns; provided
that no Grantor may assign, transfer or delegate any of its rights or
obligations under this Agreement without the prior written consent of the
Administrative Agent.
8.6 Set-Off. Each Grantor hereby irrevocably authorizes the Administrative
Agent and each Lender at any time and from time to time while an Event of
Default shall have occurred and be continuing, without notice to such Grantor or
any other Grantor, any such notice being expressly waived by each Grantor, to
set-off and appropriate and apply any and all deposits (general or special, time
or demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by the Administrative Agent or such Lender to or for the credit or the
account of such Grantor, or any part thereof in such amounts as the
Administrative Agent or such Lender may elect, against and on account of the
obligations and liabilities of such Grantor to the Administrative Agent or such
Lender hereunder and claims of every nature and description of the
Administrative Agent or such Lender against such Grantor, in any currency,
whether arising hereunder, under the Credit Agreement, any other Loan Document
or otherwise, as the Administrative Agent or such Lender may elect, whether or
not the Administrative Agent or any Lender has made any demand for payment and
although such obligations, liabilities and claims may be contingent or
unmatured. The Administrative Agent and each Lender shall notify such Grantor
promptly of any such set-off and the application made by the Administrative
Agent or such Lender of the proceeds thereof, provided that the failure to give
such notice shall not affect the validity of such set-off and application. The
rights of the Administrative Agent and each Lender under this Section 8.6 are in
addition to other rights and remedies (including, without limitation, other
rights of set-off) which the Administrative Agent or such Lender may have.
8.7 Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
8.8 Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
8.9 Section Headings. The Section headings used in this Agreement are for
convenience of reference only and are not to affect the construction hereof or
be taken into consideration in the interpretation hereof.
20
8.10 Integration. This Agreement and the other Loan Documents represent the
agreement of the Grantors, the Administrative Agent and the Lenders with respect
to the subject matter hereof and thereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof and thereof not expressly set forth or
referred to herein or in the other Loan Documents.
8.11 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
8.12 Submission To Jurisdiction; Waivers. Each Grantor hereby irrevocably
and unconditionally:
(a) submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Loan Documents to which it is a party,
or for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Grantor at its
address referred to in Section 8.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to xxx in
any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it may
have to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.
8.13 Acknowledgements. Each Grantor hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents to which it is a party;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to any Grantor arising out of or in connection with
this Agreement or any of the other Loan Documents, and the relationship between
the Grantors, on the one hand, and the Administrative Agent and Lenders, on the
other hand, in connection herewith or therewith is solely that of debtor and
creditor; and
21
(c) no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Grantors and the Lenders.
8.14 Additional Grantors. Each Subsidiary of the Borrower that is required
to become a party to this Agreement pursuant to Section 9.7 of the Credit
Agreement shall become a Grantor for all purposes of this Agreement upon
execution and delivery by such Subsidiary of an Assumption Agreement in the form
of Annex 1 hereto.
8.15 Releases. (a) At such time as the Loans, the Reimbursement Obligations
and the other Obligations (other than Obligations in respect of Specified Swap
Agreements) shall have been paid in full, the Commitments have been terminated
and no Letters of Credit or Acceptances shall be outstanding, the Collateral
shall be released from the Liens created hereby, and this Agreement and all
obligations (other than those expressly stated to survive such termination) of
the Administrative Agent and each Grantor hereunder shall terminate, all without
delivery of any instrument or performance of any act by any party, and all
rights to the Collateral shall revert to the Grantors. At the request and sole
expense of any Grantor following any such termination, the Administrative Agent
shall deliver to such Grantor any Collateral held by the Administrative Agent
hereunder, and execute and deliver to such Grantor such documents as such
Grantor shall reasonably request to evidence such termination.
(b) If any of the Collateral shall be sold, transferred or otherwise
disposed of by any Grantor in a transaction permitted by the Credit Agreement,
then the Administrative Agent, at the request and sole expense of such Grantor,
shall execute and deliver to such Grantor all releases or other documents
reasonably necessary or desirable for the release of the Liens created hereby on
such Collateral. At the request and sole expense of the Borrower, a Subsidiary
Guarantor shall be released from its obligations hereunder in the event that all
the Capital Stock of such Subsidiary Guarantor shall be sold, transferred or
otherwise disposed of in a transaction permitted by the Credit Agreement.
8.16 WAIVER OF JURY TRIAL. EACH GRANTOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
8.17 Continuing Effect. This Agreement constitutes an amendment and
restatement of all the existing Security Documents (as defined in the Existing
Credit Agreement) which guarantee and secure the Existing Credit Agreement and
such Security Documents (and the Liens created thereunder) shall continue in
full force and effect (after giving effect to the amendment and restatement
thereof pursuant to this Agreement) and shall not be or be deemed to be released
or terminated as a result of the execution and delivery of this Agreement.
IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee and
Collateral Agreement to be duly executed and delivered as of the date first
above written.
AUDIOVOX CORPORATION
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President/CFO
QUINTEX MOBILE COMMUNICATIONS CORP.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
AMERICAN RADIO CORP.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
AUDIOVOX INTERNATIONAL CORP.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
AUDIOVOX CANADA LIMITED
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
AUDIOVOX HOLDING CORP.
By: /s/ Xxxxx Xxxxxx
-------------------------------------
Name: Xxxxx Xxxxxx
Title: Secretary
AUDIOVOX ASIA INC.
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
AUDIOVOX LATIN AMERICA LTD.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
AUDIOVOX COMMUNICATIONS CORP.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
AUDIOVOX ELECTRONICS CORP.
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
CODE SYSTEMS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
AUDIOVOX COMMUNICATIONS CANADA CO.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
Schedule 1
NOTICE ADDRESSES OF GUARANTORS
Schedule 2
DESCRIPTION OF PLEDGED STOCK
Pledged Stock:
Issuer Class of Stock Stock Certificate No. No. of Shares
-------------- ----------------- ------------------------ -------------
Schedule 3
LOCATION OF JURISDICTION OF ORGANIZATION AND CHIEF EXECUTIVE OFFICE
Grantor Jurisdiction of Location of Chief
Organization Executive Office
Schedule 4
LOCATIONS OF INVENTORY
Grantor Locations
Annex 1 to
Guarantee and Collateral Agreement
ASSUMPTION AGREEMENT, dated as of ________________, 200_, made by
______________________________ (the "Additional Grantor"), in favor of JPMorgan
Chase Bank, as administrative agent (in such capacity, the "Administrative
Agent") for the banks and other financial institutions or entities (the
"Lenders") parties to the Fifth Amended and Restated Credit Agreement referred
to below. All capitalized terms not defined herein shall have the meaning
ascribed to them in such Credit Agreement.
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, Audiovox Corporation (the "Borrower"), the Lenders and the
Administrative Agent have entered into a Fifth Amended and Restated Credit
Agreement, dated as of July 15, 2004 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement");
WHEREAS, in connection with the Credit Agreement, the Borrower and certain
of its Affiliates (other than the Additional Grantor) have entered into the
Guarantee and Collateral Agreement, dated as of July 15, 2004 (as amended,
supplemented or otherwise modified from time to time, the "Guarantee and
Collateral Agreement") in favor of the Administrative Agent for the benefit of
the Lenders;
WHEREAS, the Credit Agreement requires the Additional Grantor to become a
party to the Guarantee and Collateral Agreement; and
WHEREAS, the Additional Grantor has agreed to execute and deliver this
Assumption Agreement in order to become a party to the Guarantee and Collateral
Agreement;
NOW, THEREFORE, IT IS AGREED:
1. Guarantee and Collateral Agreement. By executing and delivering this
Assumption Agreement, the Additional Grantor, as provided in Section 8.14 of the
Guarantee and Collateral Agreement, hereby becomes a party to the Guarantee and
Collateral Agreement as a Grantor thereunder with the same force and effect as
if originally named therein as a Grantor and, without limiting the generality of
the foregoing, hereby expressly assumes all obligations and liabilities of a
Grantor thereunder. The information set forth in Annex 1-A hereto is hereby
added to the information set forth in the Schedules to the Guarantee and
Collateral Agreement. The Additional Grantor hereby represents and warrants that
each of the representations and warranties contained in Section 4 of the
Guarantee and Collateral Agreement is true and correct on and as the date hereof
(after giving effect to this Assumption Agreement) as if made on and as of such
date.
2. Governing Law. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to
be duly executed and delivered as of the date first above written.
[ADDITIONAL GRANTOR]
By:___________________________
Name:
Title:
Annex 1-A to
Assumption Agreement
SCHEDULE 1
TO THE GUARANTEE AND COLLATERAL AGREEMENT
NOTICE ADDRESSES OF GUARANTORS
SUBSIDIARY ADDRESS
Quintex Mobile Communications Corp. c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
Audiovox Communications Corp. c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
American Radio Corp. c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
Audiovox International Corp. c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
Audiovox Holding Corp. c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
Audiovox Asia Inc. c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
Audiovox Latin America Ltd. c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
Audiovox Canada Limited c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
Audiovox Electronics Corp. c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
Code Systems, Inc. c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
Audiovox Communications Canada Co. c/o Audiovox Corporation
000 Xxxxxx Xxxx.
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Xx. Vice
President & CFO Tel.
(000) 000-0000 Fax
(000) 000-0000
SCHEDULE 2
TO THE GUARANTEE AND COLLATERAL AGREEMENT
DESCRIPTION OF PLEDGED STOCK
Pledged Stock:
Issuer Class of Stock Stock Certificate No. No. of Shares
--------------- -------------- --------------------- ------------
Audiovox Electronics
Corporation Common 1 100
Audiovox Holding Corp. Common 1 10
SCHEDULE 3
TO THE GUARANTEE AND COLLATERAL AGREEMENT
LOCATION OF JURISDICTION OF ORGANIZATION
AND CHIEF EXECUTIVE OFFICE
Grantor Jurisdiction of Location of Chief
Organization/Registration No. Executive Office
Audiovox Corporation Delaware 150 Marcus Blvd.
No. 2123128 Xxxxxxxxx, XX 00000
Quintex Mobile Communications Corp. Delaware 000 Xxxxxxxx Xxxx.
Xx. 0000000 Xxxxxxxxx, XX 00000
Audiovox Communications Corp. Delaware 555 Wireless Blvd.
No. 2510740 Xxxxxxxxx, XX 00000
American Radio Corp. Georgia 0000 Xxxxxxxxxx Xxxx
Xx. Xxxx Xxxxxxx, XX 00000
Audiovox International Corp. Delaware 000 Xxxxxx Xxxx.
Xx. 0000000 Xxxxxxxxx, XX 00000
Audiovox Holding Corp. New York 000 Xxxxxx Xxxx.
Xx. Xxxx Xxxxxxxxx, XX 00000
Audiovox Asia Inc. Delaware 000 Xxxxxx Xxxx.
0000000 Xxxxxxxxx, XX 00000
Audiovox Latin America Ltd. Delaware 000 Xxxxxx Xxxx.
Xx. 0000000 Xxxxxxxxx, XX 00000
Audiovox Canada Limited Canada 000 Xxxx Xxxxxx
Xx. Xxxx Xx. Xxxxxxxxxx Xxxxxxx
Audiovox Electronics Corp. Delaware 000 Xxxxxx Xxxx.
Xx. 0000000 Xxxxxxxxx, XX 00000
Code Systems, Inc. Delaware 000 Xxxxxxxxx Xxxxxx
Xx. 0000000 Xxxx, XX 00000
Audiovox Communications Nova Scotia 0000 Xxxxxxxx Xxx
Xxxxxx Co. No. 3033489 Xxxxxxxxxxx, Xxxxxxx X0X 0X0
SCHEDULE 4
TO THE GUARANATEE AND COLLATERAL AGREEMENT
LOCATIONS OF INVENTORY
Grantor Locations
Audiovox Corporation 000 Xxxxxx Xxxx., Xxxxxxxxx, Xxx Xxxx
Audiovox Communications Corp. 000 Xxxxxxxx Xxxx., Xxxxxxxxx, Xxx Xxxx
000 Xxxxx Xxxxxxx, Xxxxxxxxxxx, Xxx Xxxx
000 Xxxx Xxxxxxxx Xxxxx, Xxxx Xxxx, Xxx Xxxx
00 Xxxxx Xxxx., Xxxx Xxxx, Xxx Xxxx
000-0 Xxxxxxxxxxxxx Xxx, Xxxxxxx, Xxx Xxxx
00000 X.X. 000xx Xxxx, Xxxxx 0, Xxxxxx, Xxxxxxx
0000 Xxxxxxxx Xxxx, Xxxxx Xxxxxx, Xxx Xxxxxx
000 Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx
00000 Xxxxxxxxx Ave, Cerritos, California
00000 Xxxxx Xxxxxxxxxx, Xxxxxx Xxxxxxxxx,
Xxxxxxxxxx
0000 Xxxxxx Xxxxxx Xxxx, Xxxxxx, Xxxxxxxxxx
Audiovox Electronics Corp. 000 Xxxxxx Xxxx., Xxxxxxxxx, Xxx Xxxx
00-00 00xx Xxxx, Xxxx Xxxxxx Xxxx, Xxx Xxxx
00 Xxxxxxxx Xxxx, Xxxxxxxxx, Xxx Xxxx
0000 Xxxxxxx Xxxx X000, Xxx Xxxx, Xxxxxxxxxx
00000 Industry Circle, La Mirada, California
000 Xxxx Xxxxxxxxx Xxxx., Xxxxx 000, Xxxxxx,
Xxxxxxxxxx
0000 Xxxx XxXxxxxx Xxx., Xxxxx Xxx, Xxxxxxxxxx
0000 000xx Xxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxx
00000 X.X. 000xx Xxxx, Xxxxx 0, Xxxxxx, Xxxxxxx
000 Xxxx Xxxx., Xxxx, Xxxxxx
0000 Xxxxxxxx Xxxx, Xxxxx Xxxxxx, Xxx Xxxxxx
000 Xxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx
0000 Xxxxxxx Xxxxx, Xxxxxx Xxxxxx, Xxxxxxxx
Xxxxxxx Mobile Communications Corp. 000 Xxxxxxxx Xxxx., Xxxxxxxxx, Xxx Xxxx
8004 Staples Mill Road, Richmond,Virginia
00000 Xxxxxxxxxx Xxxxxxxx, Xxxxxxxx, Xxxxxxxx
0000 X. Xxxxxxxx Xxx, Xxxxx Xxxxx Xxxxxxxx Xxx.,
Xxxxxxx, Xxxxxxxx
000 Xxxxxxxx Xxxxxxxx, Xxxxxxx, Xxxxxxxx
American Radio Corp. 0000 Xxxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx
0000 Xxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxx
0000 Xxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxx
0000-X Xxxx Xxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxx
0000 Xxxxxxxxx Xxxxxx Xx., #000, Xxxxxxxxxxxx,
Xxxxxxx
Code Systems, Inc. 000 Xxxx Xxxxxxxx Xxx., Xxxxxxx Xxxxxxx,
Xxxxxxxx
00000 Xxxxxx Xxx., Xxxxxxxxx, Xxxxxxxx
00X. Xxxxxxx Xxxx, Xxxx Xxxx, Xxxxxxxx
000 Xxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx
Audiovox Canada Limited 000 Xxxx Xxxxxx, Xx. Xxxxxxxxxx Xxxxxxx, Xxxxxx
Audiovox Communications 0000 Xxxxxxxx Xxx, Xxxxxxxxxxx, Xxxxxxx X0X
Xxxxxx Xx. Xxxxxx
Annex 2 to
Guarantee and Collateral Agreement
ACKNOWLEDGEMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the Guarantee and
Collateral Agreement dated as of ________, 2004 (the "Agreement"), made by the
Grantors parties thereto for the benefit of JPMorgan Chase Bank, as
Administrative Agent. The undersigned agrees for the benefit of the
Administrative Agent and the Lenders as follows:
1. The undersigned will be bound by the terms of the Agreement and will
comply with such terms insofar as such terms are applicable to the undersigned.
2. The undersigned will notify the Administrative Agent promptly in writing
of the occurrence of any of the events described in Section 5.7(a) of the
Agreement.
3. The terms of Sections 6.3(c) and 6.7 of the Agreement shall apply to it,
mutatis mutandis, with respect to all actions that may be required of it
pursuant to Section 6.3(c) or 6.7 of the Agreement.
[NAME OF ISSUER]
By:_______________________________________
Name:
Title:
Address for Notices:
-----------------------------------------
-----------------------------------------
-----------------------------------------
Fax:
