ARTICLE I Definitions.......................................................... ............................................................................... .................................................... 1 Section 1.01. Credit Agr...
Exhibit
10.26
EXECUTION
VERSION
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AMENDED
AND RESTATED
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dated
as of
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December
15, 2006,
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among
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DENNY’S,
INC.,
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DENNY’S
REALTY, LLC,
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XXXXX’X
CORPORATION,
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DENNY’S
HOLDINGS, INC.,
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DFO,
LLC,
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each
other Subsidiary Loan Party
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and
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BANK
OF AMERICA, N.A.,
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as
Collateral Agent
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Table
of Contents
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Page
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ARTICLE
I
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Definitions.............................................................................................................................................................................................
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1
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Section
1.01.
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Credit
Agreement..........................................................................................................................................................................
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1
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Section
1.02.
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Other
Defined
Terms....................................................................................................................................................................
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2
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ARTICLE
II
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Guarantee...............................................................................................................................................................................................
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5
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Section
2.01.
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Guarantee.......................................................................................................................................................................................
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5
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Section
2.02.
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Guarantee
of
Payment..................................................................................................................................................................
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5
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Section
2.03.
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No
Limitations,
Etc.......................................................................................................................................................................
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6
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Section
2.04.
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Reinstatement...............................................................................................................................................................................
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8
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Section
2.05.
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Agreement
To Pay;
Subrogation...............................................................................................................................................
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8
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Section
2.06.
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Information....................................................................................................................................................................................
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8
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ARTICLE
III
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Pledge
of
Securities..............................................................................................................................................................................
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8
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Section
3.01.
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Pledge.............................................................................................................................................................................................
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8
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Section
3.02.
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Delivery
of the Pledged
Collateral..............................................................................................................................................
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9
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Section
3.03.
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Representations,
Warranties and
Covenants..........................................................................................................................
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10
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Section
3.04.
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Certification
of Limited Liability Company and Limited Partnership
Interests....................................................................
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11
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Section
3.05.
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Registration
in Nominee Name;
Denominations......................................................................................................................
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11
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Section
3.06.
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Voting
Rights; Dividends and Interest,
etc..............................................................................................................................
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11
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ARTICLE
IV
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Security
Interests in Personal
Property.............................................................................................................................................
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12
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Section
4.01.
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Security
Interest............................................................................................................................................................................
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12
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Section
4.02.
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Representations
and
Warranties................................................................................................................................................
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14
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Section
4.03.
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Covenants......................................................................................................................................................................................
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15
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Section
4.04.
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Other
Actions................................................................................................................................................................................
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19
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Section
4.05.
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Covenants
Regarding Patent, Trademark and Copyright
Collateral.....................................................................................
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21
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ARTICLE
V
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Remedies................................................................................................................................................................................................
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23
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Section
5.01.
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Remedies
Upon
Default...............................................................................................................................................................
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23
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Section
5.02.
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Application
of
Proceeds..............................................................................................................................................................
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24
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Section
5.03.
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Grant
of License to Use Intellectual
Property..........................................................................................................................
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25
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Section
5.04.
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Securities
Act,
etc.........................................................................................................................................................................
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25
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Section
5.05.
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Registration,
etc............................................................................................................................................................................
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26
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ARTICLE
VI
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Indemnity,
Subrogation and
Subordination.....................................................................................................................................
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26
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Section
6.01.
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Indemnity
and
Subrogation........................................................................................................................................................
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26
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Section
6.02.
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Contribution
and
Subrogation....................................................................................................................................................
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26
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Section
6.03.
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Subordination................................................................................................................................................................................
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27
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ARTICLE
VII
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Miscellaneous.......................................................................................................................................................................................
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27
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Section
7.01.
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Notices...........................................................................................................................................................................................
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27
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Section
7.02.
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Security
Interest
Absolute..........................................................................................................................................................
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27
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Section
7.03.
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Survival
of
Agreement.................................................................................................................................................................
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27
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i
Table
of Contents
(continued)
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Section
7.04.
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Binding
Effect; Several
Agreement............................................................................................................................................
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28
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Section
7.05.
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Successors
and
Assigns.............................................................................................................................................................
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28
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Section
7.06.
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Collateral
Agent’s Fees and Expenses;
Indemnification........................................................................................................
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28
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Section
7.07.
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Collateral
Agent Appointed
Attorney-in-Fact.........................................................................................................................
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29
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Section
7.08.
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GOVERNING
LAW.......................................................................................................................................................................
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29
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Section
7.09.
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Waivers;
Amendment..................................................................................................................................................................
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29
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Section
7.10.
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WAIVER
OF JURY
TRIAL..........................................................................................................................................................
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30
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Section
7.11.
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Severability....................................................................................................................................................................................
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30
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Section
7.12.
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Counterparts..................................................................................................................................................................................
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30
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Section
7.13.
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Headings........................................................................................................................................................................................
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31
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Section
7.14.
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Jurisdiction;
Consent to Service of
Process.............................................................................................................................
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31
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Section
7.15.
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Termination
or
Release................................................................................................................................................................
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31
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Section
7.16.
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Additional
Subsidiaries...............................................................................................................................................................
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32
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Section
7.17.
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Right
of
Setoff...............................................................................................................................................................................
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32
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Section
7.18.
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Effect
on Existing Guarantee and Collateral
Agreement.........................................................................................................
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32
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ii
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Schedules
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Schedule
I
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Subsidiary
Loan Parties
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Schedule
II
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Pledged
Equity Securities; Pledged Debt Securities
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Schedule
III
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Intellectual
Property
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Schedule
IV
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Insurance
Requirements
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Exhibits
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Exhibit
I
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Form
of Supplement to the Guarantee and Collateral Agreement
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Exhibit
II
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Form
of Perfection Certificate
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Exhibit
III
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Form
Of Deposit Account Control
Agreement
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iii
AMENDED
AND RESTATED GUARANTEE AND COLLATERAL AGREEMENT dated as of December 15,
2006
(this “Agreement”),
among
Denny’s, Inc., a California corporation, Xxxxx’x Realty, LLC, a Delaware limited
liability company (each of the foregoing individually, a “Borrower”
and
collectively, the “Borrowers”),
Xxxxx’x Corporation, a Delaware corporation (“Parent”),
Denny’s Holdings, Inc., a New York corporation (“Denny’s
Holdings”),
DFO,
LLC, a Delaware limited liability company (“DFO”),
each
other Subsidiary Loan Party (as defined in the Credit Agreement) and Bank
of
America, N.A. (“Bank
of America”),
as
Collateral Agent (in such capacity, the “Collateral
Agent”)
for
the Secured Parties (as defined below).
Reference
is made to (a) the Guarantee and Collateral Agreement dated as of September
21,
2004 (as amended, supplemented, waived or otherwise modified from time
to time,
the “Existing
Guarantee and Collateral Agreement”),
among
the Denny’s, Inc., Denny’s Realty, LLC (formerly known as Denny’s Realty, Inc.),
Parent, Denny's Holdings, DFO (formerly known as DFO, Inc.), the Collateral
Agent and such other parties from time to time party thereto and (b) the
Amended
and Restated Credit Agreement dated as of December 15, 2006 (as amended,
supplemented, waived or otherwise modified from time to time, the “Credit
Agreement”),
among
the Borrowers, Parent, Denny’s Holdings, and DFO, as Guarantors, the Lenders
party thereto (the “Lenders”),
and
Bank of America, as Administrative Agent.
WHEREAS,
the Borrowers have requested, among other things, to amend and restate
the
Existing Credit Agreement (as defined in the Credit Agreement) on the terms
and
conditions set forth in the Credit Agreement and the Administrative Agent,
the
Lenders and the other parties thereto are willing to amend and restate
the
Existing Credit Agreement on the terms and conditions set forth in the
Credit
Agreement;
WHEREAS,
the obligations of the Lenders to enter into the Credit Agreement and to
extend
credit to the Borrowers thereunder are conditioned upon, among other things,
the
amendment and restatement of the Existing Guarantee and Collateral Agreement
in
the form of this Agreement and the execution and delivery of this Agreement
by
the parties hereto; and
WHEREAS,
Parent and the Subsidiary Loan Parties are affiliates of the Borrowers,
will
derive substantial benefits from the extension of credit to the Borrowers
pursuant to the Credit Agreement and are willing to execute and deliver
this
Agreement in order to induce the Lenders to extend such credit.
NOW
THEREFORE, the parties hereto agree that the Existing Guarantee and Collateral
Agreement is hereby amended and restated as follows:
ARTICLE
I
Definitions
Section
1.01. Credit
Agreement.
(a)
Capitalized terms used in this Agreement and not otherwise defined herein
have
the meanings specified in the Credit Agreement. All terms defined in the
New
York UCC (as defined herein) and not defined in this Agreement have the
meanings
specified therein; the term “instrument” shall have the meaning specified in
Article 9 of the New York UCC.
(b) The
rules
of construction specified in Section 1.03 of the Credit Agreement also
apply to
this Agreement.
Section
1.02. Other
Defined Terms.
As used
in this Agreement, the following terms have the meanings specified
below:
“Account
Debtor”
means
any Person who is or who may become obligated to any Grantor under, with
respect
to or on account of an Account.
“Article
9 Collateral”
has
the
meaning assigned to such term in Section 4.01.
“Cash
Management Agreement”
means
any agreement or arrangement to provide cash management services, including
treasury, depository, overdraft, credit or debit card, electronic funds
transfer
and other cash management arrangements.
“Claiming
Guarantor”
has
the
meaning assigned to such term in Section 6.02.
“Collateral”
means
Article 9 Collateral and Pledged Collateral.
“Collateral
Agent”
has
the
meaning assigned to such term in the preamble of this Agreement.
“Contributing
Guarantor”
has
the
meaning assigned to such term in Section 6.02.
“Copyright
License”
means
any written agreement, now or hereafter in effect, granting any right to
any
third party under any copyright now or hereafter owned by any Grantor or
that
any Grantor otherwise has the right to license, or granting any right to
any
Grantor under any copyright now or hereafter owned by any third party,
and all
rights of any Grantor under any such agreement.
“Copyrights”
means
all of the following now owned or hereafter acquired by any Grantor: (a)
all
copyright rights in any work subject to the copyright laws of the United
States
or any other country, whether as author, assignee, transferee or otherwise;
and
(b) all registrations and applications for registration of any such copyright
in
the United States or any other country, including registrations, recordings,
supplemental registrations and pending applications for registration in
the
United States Copyright Office, including those listed on Schedule
III.
“Credit
Agreement”
has
the
meaning assigned to such term in the preliminary statement of this
Agreement.
“Deposit
Account Bank”
has
the
meaning assigned to such term in Section 4.04(b).
“Deposit
Account Control Agreement”
means
an agreement substantially in the form of Exhibit III, or any other form
approved by the Collateral Agent, among a Grantor, the Collateral Agent
and a
Sub-Agent.
“Equity
Interests”
means
shares of capital stock, partnership interests, membership interests in
a
limited liability company, beneficial interests in a trust or other equity
ownership interests in a Person of whatever nature and rights, warrants
or
options to acquire any of the foregoing.
“Federal
Securities Laws”
has
the
meaning assigned to such term in Section 5.04.
“General
Intangibles”
means
all “General Intangibles” as defined in the New York UCC, including payment
intangibles, all choses in action and causes of action and all other intangible
personal property of any Grantor of every kind and nature (other than Accounts)
now owned or hereafter acquired by any Grantor, including corporate or
other
business records, indemnification claims, contract rights (including rights
under leases, whether entered into as lessor or lessee, Hedging Agreements,
franchise agreements and other agreements) and rights to payment, Intellectual
Property, goodwill, registrations, franchises, tax refund claims and any
letter
of credit, guarantee, claim, security interest or other security held by
or
granted to any Grantor to secure payment by an Account Debtor of any of
the
Accounts.
5
“Grantors”
means
Parent, the Borrowers and the Subsidiary Loan Parties.
“Guarantors”
means
Parent, the Borrowers and the Subsidiary Loan Parties.
“Intellectual
Property”
means
all intellectual and similar property of every kind and nature now owned
or
hereafter acquired by any Grantor, including inventions, designs, Patents,
Copyrights, Licenses, Trademarks, trade secrets, domain names, confidential
or
proprietary technical and business information, know-how, show-how or other
data
or information, software and databases and all embodiments or fixations
thereof
and related documentation, registrations and franchises, and all additions,
improvements and accessions to, and books and records describing or used
in
connection with, any of the foregoing.
“Investment
Property”
means
a
security, whether certificated or uncertificated, security entitlement,
securities account, commodity contract or commodity account; provided
that for
purposes of this Agreement, the capital stock of Xxxxxx Holdings, Inc.
owned by
Denny’s Holdings and scheduled on Schedule 6.04 to the Credit Agreement shall
not be Investment Property.
“License”
means
any Patent License, Trademark License, Copyright License or other license
or
sublicense agreement to which any Grantor is a party, other than those
license
or sublicense agreements (a) in existence on the date hereof and (b) entered
into after the date hereof, in each case that by their terms prohibit a
grant of
a security interest by such Grantor as licensee thereunder; provided
that (i)
in the case of clause (b), such Grantor has used commercially reasonable
efforts
to prevent the inclusion of such a prohibition over such license or sublicense
and (ii) in the case of any licenses or sublicenses excluded pursuant to
clauses
(a) and (b), such licenses or sublicenses, individually or in the aggregate,
are
not material to the business of such Grantor. For the avoidance of doubt,
any
money or property received in respect of any license that is not a License
shall
not be excluded from the Collateral solely as a result of the exclusion
of such
license from the Collateral.
“Loan
Document Obligations”
means
(a) the due and punctual payment by the Borrowers of (i) the principal
of and
interest (including interest accruing during the pendency of any bankruptcy,
insolvency, receivership or other similar proceeding, regardless of whether
allowed or allowable in such proceeding) on the Loans, when and as due,
whether
at maturity, by acceleration, upon one or more dates set for prepayment
or
otherwise, (ii) each payment required to be made by the Borrowers under
the
Credit Agreement in respect of any Letter of Credit or any Credit-Linked
Deposits, when and as due, including payments in respect of reimbursement
of
disbursements, interest and fees thereon and obligations to provide cash
collateral in respect of such Letters of Credit, and (iii) all other monetary
obligations of the Borrowers to any of the Secured Parties under the Credit
Agreement and each of the other Loan Documents, including obligations to
pay
fees, expense and reimbursement obligations and indemnification obligations,
whether primary, secondary, direct, contingent, fixed or otherwise (including
monetary obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed
or
allowable in such proceeding), (b) the due and punctual performance of
all other
obligations of the Borrowers under or pursuant to the Credit Agreement
and each
of the other Loan Documents and (c) the due and punctual payment and performance
of all the obligations of each other Loan Party under or pursuant to this
Agreement and each of the other Loan Documents.
6
“New
York UCC”
means
the Uniform Commercial Code as from time to time in effect in the State
of New
York.
“Obligations”
means
(a) Loan Document Obligations, (b) the due and punctual payment and performance
of all obligations of each Loan Party under each Hedging Agreement that,
in
either case, if and to the extent permitted by the Credit Agreement (i)
is in
effect on the Closing Date with a counterparty that is a Lender or an Affiliate
of a Lender as of the Closing Date or (ii) is entered into after the Closing
Date with any counterparty that is a Lender or an Affiliate of a Lender
at the
time such Hedging Agreement is entered into and (c) the due and punctual
payment
and performance of all obligations in respect of overdrafts and other
liabilities owed to the Administrative Agent or any of its Affiliates or
any
Lender arising from treasury, depositary and cash management services in
connection with any automated clearinghouse transfers of funds (including,
without limitation, any Cash Management Agreements).
“Patent
License”
means
any written agreement, now or hereafter in effect, granting to any third
party
any right to make, use or sell any invention on which a patent, now or
hereafter
owned by any Grantor or that any Grantor otherwise has the right to license,
is
in existence, or granting to any Grantor any right to make, use or sell
any
invention on which a patent, now or hereafter owned by any third party,
is in
existence, and all rights of any Grantor under any such agreement.
“Patents”
means
all of the following now owned or hereafter acquired by any Grantor: (a)
all
letters patent of the United States or the equivalent thereof in any other
country, all registrations and recordings thereof, and all applications
for
letters patent of the United States or the equivalent thereof in any other
country, including registrations, recordings and pending applications in
the
United States Patent and Trademark Office or any similar offices in any
other
country, including those listed on Schedule III; and (b) all reissues,
continuations, divisions, continuations-in-part, renewals or extensions
thereof,
and the inventions disclosed or claimed therein, including the right to
make,
use and/or sell the inventions disclosed or claimed therein.
“Perfection
Certificate”
means
a
certificate substantially in the form of Exhibit II, completed and supplemented
with the schedules and attachments contemplated thereby, and duly executed
by a
Financial Officer and a legal officer of the Borrowers.
“Pledged
Collateral”
has
the
meaning assigned to such term in Section 3.01.
“Pledged
Debt Securities”
has
the
meaning assigned to such term in Section 3.01.
“Pledged
Securities”
means
any promissory notes, stock certificates or other securities now or hereafter
included in the Pledged Collateral, including all certificates, instruments
or
other documents representing or evidencing any Pledged Collateral.
“Pledged
Stock”
has
the
meaning assigned to such term in Section 3.01.
“Secured
Parties”
means
(a) the Lenders (and any Affiliate of any Lender to which any obligation
referred to in clause (c) of the definition of the term “Obligations” is owed),
(b) the Administrative Agent (and any Affiliate of the Administrative Agent
to
which any obligation referred to in clause (c) of the definition of the
term
“Obligations” is owed), (c) the Collateral Agent, (d) each Issuing Bank, (e)
each counterparty to any Hedging Agreement entered into with a Loan Party
the
obligations under which constitute Obligations, (f) the beneficiaries of
each
indemnification obligation undertaken by any Loan Party under any Loan
Document
and (g) the successors and assigns of each of the foregoing.
7
“Security
Interest”
has
the
meaning assigned to such term in Section 4.01.
“Sub-Agent”
means
a
financial institution that has delivered to the Collateral Agent an executed
Deposit Account Control Agreement.
“Trademark
License”
means
any written agreement, now or hereafter in effect, granting to any third
party
any right to use any trademark now or hereafter owned by any Grantor or
that any
Grantor otherwise has the right to license, or granting to any Grantor
any right
to use any trademark now or hereafter owned by any third party, and all
rights
of any Grantor under any such agreement.
“Trademarks”
means
all of the following now owned or hereafter acquired by any Grantor: (a)
all
trademarks, service marks, trade names, corporate names, company names,
business
names, fictitious business names, trade styles, trade dress, logos, other
source
or business identifiers, designs and general intangibles of like nature,
now
existing or hereafter adopted or acquired, all registrations and recordings
thereof, and all registration and recording applications filed in connection
therewith, including registrations and registration applications in the
United
States Patent and Trademark Office or any similar offices in any State
of the
United States or any other country or any political subdivision thereof,
and all
extensions or renewals thereof, including those listed on Schedule III;
(b) all
goodwill associated therewith or symbolized thereby; and (c) all other
assets,
rights and interests that uniquely reflect or embody such goodwill.
ARTICLE
II
Guarantee
Section
2.01. Guarantee.
Each
Guarantor hereby ratifies and affirms its unconditional guarantee made
under
Section 2.01 of the Existing Guarantee and Collateral Agreement and, for
the
avoidance of doubt, hereby unconditionally guarantees, jointly with the
other
Guarantors and severally, as a primary obligor and not merely as a surety,
the
due and punctual payment and performance of the Obligations. Each Guarantor
further agrees that the Obligations may be extended or renewed, in whole
or in
part, without notice to or further assent from it, and that it will remain
bound
upon its guarantee notwithstanding any extension or renewal of any Obligation.
Each Guarantor waives presentment to, demand of payment from and protest
to the
Borrowers or any other Loan Party of any of the Obligations, and also waives
notice of acceptance of its guarantee and notice of protest for
nonpayment.
Section
2.02. Guarantee
of Payment.
Each
Guarantor further agrees that its guarantee hereunder constitutes a guarantee
of
payment when due and not of collection, and waives any right to require
that any
resort be had by the Collateral Agent or any other Secured Party to any
security
held for the payment of the Obligations or to any balance of any deposit
account
or credit on the books of the Collateral Agent or any other Secured Party
in
favor of the Borrowers or any other Person.
Section
2.03. No
Limitations, Etc.
(a)
Except
for termination of a Guarantor’s obligations hereunder as expressly provided in
Section 7.15, the obligations of each Guarantor hereunder shall not be
subject
to any reduction, limitation, impairment or termination for any reason,
including any claim of waiver, release, surrender, alteration or compromise,
and
shall not be subject to any defense or setoff, counterclaim, recoupment
or
termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Obligations or otherwise. Without limiting the
generality of the foregoing, the obligations of each Guarantor hereunder
shall
not be discharged or impaired or otherwise affected by (i) the failure
of the
Administrative Agent, the Collateral Agent or any other Secured Party to
assert
any claim or demand or to exercise or enforce any right or remedy under
the
provisions of any Loan Document or otherwise; (ii) any rescission, waiver,
amendment or modification of, or any release from any of the terms or provisions
of, any Loan Document or any other agreement, including with respect to
any
other Guarantor under this Agreement; (iii) the failure to perfect any
security
interest in, or the release of, any security held by the Collateral Agent
or any
other Secured Party for the Obligations; (iv) any default, failure or delay,
wilful or otherwise, in the performance of the Obligations; (v) any other
act or
omission that may or might in any manner or to any extent vary the risk
of any
Guarantor or otherwise operate as a discharge of any Guarantor as a matter
of
law or equity (other than the indefeasible payment in full in cash of all
the
Obligations) or (vi) any law or regulation of any jurisdiction or any other
event affecting any term of a guaranteed obligation. Each Guarantor expressly
authorizes the Secured Parties to take and hold security for the payment
and
performance of the Obligations, to exchange, waive or release any or all
such
security (with or without consideration), to enforce or apply such security
and
direct the order and manner of any sale thereof in their sole discretion
or to
release or substitute any one or more other guarantors or obligors upon
or in
respect of the Obligations, all without affecting the obligations of any
Guarantor hereunder.
8
(b) (i)
To
the
fullest extent permitted by applicable law, each Guarantor waives any defense
based on or arising out of any defense of the Borrowers or any other Loan
Party
or the unenforceability of the Obligations or any part thereof from any
cause,
or the cessation from any cause of the liability of the Borrowers or any
other
Loan Party, other than the indefeasible payment in full in cash of all
the
Obligations. The Collateral Agent may, at its election, foreclose on any
security held by it by one or more judicial or nonjudicial sales, accept
an
assignment of any such security in lieu of foreclosure, compromise or adjust
any
part of the Obligations, make any other accommodation with the Borrowers
or any
other Loan Party or exercise any other right or remedy available to them
against
the Borrowers or any other Loan Party, without affecting or impairing in
any way
the liability of any Guarantor hereunder except to the extent the Obligations
have been fully and indefeasibly paid in full in cash. To the fullest extent
permitted by applicable law, each Guarantor waives any defense arising
out of
any such election even though such election operates, pursuant to applicable
law, to impair or to extinguish any right of reimbursement or subrogation
or
other right or remedy of such Guarantor against the Borrowers or any other
Loan
Party, as the case may be, or any security.
(ii)
Each
Guarantor waives any right it may have to require the Collateral Agent
or the
Lenders to proceed against any Borrower or any other Guarantor, proceed
against
or exhaust any security held from any Borrower or any other Guarantor,
or pursue
any other remedy in their respective power to pursue, as well as any defense
based on any claim that Guarantor’s obligations exceed or are more burdensome
than those of any Borrower. To the extent that the laws of the State of
California may be deemed to apply to the Guarantees, the rights which each
Guarantor hereby waives include all rights of subordination, reimbursement,
indemnification and contribution and any other rights and defenses that
are or
may become available to such Guarantor by reason of Section 2787 to 2855,
inclusive, of the California Civil Code; provided
that
these waivers shall not limit the express rights of the Guarantors that
are set
forth in Sections 6.01 and 6.02 hereof.
(iii)
Each
Guarantor understands and acknowledges that if the Collateral Agent forecloses
judicially or nonjudicially against any real property security for the
Obligations, such foreclosure could impair or destroy any right or ability
that
any Guarantor may have to seek reimbursement, contribution or indemnification
for any amounts paid by such Guarantor under its Guarantee. To the extent
that
the laws of the State of California may be deemed to apply to the Guarantees,
each Guarantor further understands and acknowledges that, in the absence
of this
waiver, such potential impairment or destruction of the Guarantor’s rights, if
any, may entitle the Guarantor to assert a defense to its Guarantee based
on
California Code of Civil Procedure §580d as interpreted in Union
Bank x. Xxxxxxx,
(1968)
265 CA 2d 40, 71 CR 64, on the grounds, among others, that a lender should
be
estopped from pursuing a guarantor when the lender’s election to foreclose has
impaired or destroyed the guarantor’s rights of subrogation, reimbursement,
contribution or indemnification rights. By execution of this Agreement,
each
Guarantor intentionally, freely, irrevocably, and unconditionally: (A)
waives
and relinquishes that defense and agrees that such Guarantor will be liable
under its Guarantee even though the Collateral Agent had foreclosed judicially
or nonjudicially against any real or personal property collateral for the
Obligations or any of the Guarantees; and (B) agrees that such Guarantor
will
not assert that defense in any action or proceeding which the Collateral
Agent
or the Lenders may commence to enforce its Guarantee. Without limiting
the
foregoing, each Guarantor waives all rights and defenses arising out of
an
election of remedies by the Collateral Agent or the Lenders, even though
that
election of remedies, such as nonjudicial foreclosure with respect to security
for a guaranteed obligation, has destroyed such Guarantor’s rights of
subrogation and reimbursement against the principal or another Guarantor
by the
operation of Section 580d of the California Code of Civil
Procedure.
9
(iv)
To
the
extent that the laws of the State of California may be deemed to apply
to the
Guarantees, each Guarantor intentionally, freely, irrevocably and
unconditionally waives and relinquishes all rights which may be available
to it
under any provision of California law or under any California judicial
decision,
including Section 580a and 726(b) of the California Code of Civil Procedure,
to
seek to limit the amount of any deficiency judgment or other judgment which
may
be obtained against such Guarantor under its Guarantee to not more than
the
amount by which the unpaid Obligations guaranteed hereby exceed the fair
market
value or fair value of any real or personal property securing said Obligations,
including, without limitation, all rights to an appraisement of, judicial
or
other hearing on, or other determination of the value of said
property.
(v)
To
the
extent that the laws of the State of California may be deemed to apply
to the
Guarantees, and without limiting any of the other waivers and provisions
set
forth herein, if the debt of any Borrower or another Guarantor’s Guarantee is
secured by real property, each Guarantor hereby intentionally, freely,
irrevocably and unconditionally waives all rights and defenses that Guarantor
may have because the debt of such Borrower or another Guarantor’s Guarantee is
secured by real property; this means, among other things: (A) the Collateral
Agent and the Lenders may collect from that Guarantor without first foreclosing
on any real or personal property collateral pledged by any Borrower or
another
Guarantor; (B) the amount of the Obligations may be reduced only by the
price
for which that collateral is sold at the foreclosure sale, even if the
collateral is determined to be worth more than the sale price; and (C)
the
Collateral Agent and the Lenders may collect from that Guarantor even if
the
Collateral Agent, by foreclosing on the real property collateral, has destroyed
any right the Guarantor may have to collect from such Borrower or another
Guarantor. This is an unconditional and irrevocable waiver of any rights
and
defenses that such Guarantor may have under circumstances where the debt
of any
Borrower or another Guarantor’s Guarantee is secured by real property. These
rights and defenses include, but are not limited to, any rights or defenses
based upon Section 580a, 580b, 580d or 726 of the California Code of Civil
Procedure.
Section
2.04. Reinstatement.
Each
Guarantor agrees that its guarantee hereunder shall continue to be effective
or
be reinstated, as the case may be, if at any time payment, or any part
thereof,
of any Obligation is rescinded or must otherwise be restored by the
Administrative Agent or any other Secured Party upon the bankruptcy or
reorganization of the Borrowers, any other Loan Party or otherwise.
10
Section
2.05. Agreement
To Pay; Subrogation.
In
furtherance of the foregoing and not in limitation of any other right that
the
Collateral Agent or any other Secured Party has at law or in equity against
any
Guarantor by virtue hereof, upon the failure of the Borrowers or any other
Loan
Party to pay any Obligation when and as the same shall become due, whether
at
maturity, by acceleration, after notice of prepayment or otherwise, each
Guarantor hereby promises to and will forthwith pay, or cause to be paid,
to the
Collateral Agent for distribution to the applicable Secured Parties in
cash the
amount of such unpaid Obligation. Upon payment by any Guarantor of any
sums to
the Collateral Agent as provided above, all rights of such Guarantor against
the
Borrowers or any other Guarantor arising as a result thereof by way of
right of
subrogation, contribution, reimbursement, indemnity or otherwise shall
in all
respects be subject to Article VI.
Section
2.06. Information.
Each
Guarantor assumes all responsibility for being and keeping itself informed
of
the Borrowers’ and each other Loan Party’s financial condition and assets, and
of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature, scope and extent of the risks that such Guarantor
assumes and incurs hereunder, and agrees that none of the Collateral Agent
or
the other Secured Parties will have any duty to advise such Guarantor of
information known to it or any of them regarding such circumstances or
risks.
ARTICLE
III
Pledge
of Securities
Section
3.01. Pledge.
Each
Grantor hereby ratifies and affirms its pledge, assignment and grant of
security
interests made pursuant to Section 3.01 of the Existing Guarantee and Collateral
Agreement, and, for the avoidance of doubt, as security for the payment
or
performance, as the case may be, in full of the Obligations, each Grantor
hereby
assigns and pledges to the Collateral Agent, its successors and assigns,
for the
benefit of the Secured Parties, and hereby grants to the Collateral Agent,
its
successors and assigns, for the benefit of the Secured Parties, a security
interest in all of such Grantor’s right, title and interest in, to and under (a)
the shares of capital stock and other Equity Interests owned by it and
listed on
Schedule II and any other Equity Interests obtained in the future by such
Grantor and the certificates representing all such Equity Interests (the
“Pledged
Stock”);
provided
that the
Pledged Stock shall not include (i) more than 65% of the issued and outstanding
voting Equity Interests of any Foreign Subsidiary, (ii) to the extent applicable
law requires that a subsidiary of such Grantor issue directors’ qualifying
shares, such qualifying shares or (iii) any Equity Interests received by
Denny’s
Holdings in respect of shares of Series A Cumulative Convertible Preferred
Stock
of Xxxxxx Holdings, Inc. to the extent that, on the date such Equity Interests
are received, the Equity Rights Agreement entered into as of August 30,
2001, by
and among Xxxxxx Holdings, Inc. and Denny’s Holdings restricts the pledge of
such Equity Interests; (b)(i) the debt securities listed opposite the name
of
such Grantor on Schedule II, (ii) any debt securities in the future issued
to
such Grantor and (iii) the promissory notes and any other instruments,
if any,
evidencing such debt securities (the “Pledged
Debt Securities”);
(c)
all other property that may be delivered to and held by the Collateral
Agent
pursuant to the terms of this Section 3.01; (d) subject to Section 3.06,
all
payments of principal or interest, dividends, cash, instruments and other
property from time to time received, receivable or otherwise distributed
in
respect of, in exchange for or upon the conversion of, and all other Proceeds
received in respect of, the securities referred to in clauses (a) and (b)
above
and the property referred to in clause (c) above; (e) subject to Section
3.06,
all rights and privileges of such Grantor with respect to the securities
and
other property referred to in clauses (a), (b), (c) and (d) above; and
(f) all
Proceeds of any of the foregoing (the items referred to in clauses (a)
through
(f) above being collectively referred to as the “Pledged
Collateral”).
11
TO
HAVE
AND TO HOLD the Pledged Collateral, together with all right, title, interest,
powers, privileges and preferences pertaining or incidental thereto, unto
the
Collateral Agent, its successors and assigns, for the benefit of the Secured
Parties, forever; subject,
however,
to the
terms, covenants and conditions hereinafter set forth.
Section
3.02. Delivery
of the Pledged Collateral.
(a) Each
Grantor agrees promptly to deliver or cause to be delivered to the Collateral
Agent certificates, instruments and other documents representing or evidencing
any Pledged Securities having a value in excess of $10,000.
(b) Each
Grantor will cause any Indebtedness for borrowed money (other than trade
debt
incurred in the ordinary course of business) owed to such Grantor by any
Person
in excess of $10,000 in principal amount to be evidenced by a duly executed
promissory note that is pledged and delivered to the Collateral Agent pursuant
to the terms hereof.
(c) Upon
delivery to the Collateral Agent, (i) any Pledged Securities shall be
accompanied by stock powers duly executed in blank or other instruments
of
transfer satisfactory to the Collateral Agent and by such other instruments
and
documents as the Collateral Agent may reasonably request to perfect its
security
interest therein and (ii) all other property composing part of the Pledged
Collateral shall be accompanied by proper instruments of assignment duly
executed by the applicable Grantor and such other instruments or documents
as
the Collateral Agent may reasonably request to perfect its security interest
therein. Each delivery of Pledged Securities shall be accompanied by a
schedule
describing the securities, which schedule shall be attached hereto as Schedule
II and made a part hereof; provided
that
failure to attach any such schedule hereto shall not affect the validity
of such
pledge of such Pledged Securities. Each schedule so delivered shall supplement
any prior schedules so delivered.
Section
3.03. Representations,
Warranties and Covenants.
The
Grantors jointly and severally represent, warrant and covenant to and with
the
Collateral Agent, for the benefit of the Secured Parties, that:
(a) Schedule
II correctly sets forth the percentage of the issued and outstanding shares
of
each class of the Equity Interests of the issuer thereof represented by
such
Pledged Stock and includes all Equity Interests, debt securities and promissory
notes required to be pledged hereunder in order to satisfy the Collateral
and
Guarantee Requirement;
(b) the
Pledged Stock and Pledged Debt Securities have been duly and validly authorized
and issued by the issuers thereof and (i) in the case of Pledged Stock
issued by
a corporation, are fully paid and nonassessable, (ii) in the case of Pledged
Debt Securities other than Pledged Debt Securities issued by Parent, any
Borrower or any other Subsidiary, to the knowledge of the Grantor pledging
any
such Pledged Debt Securities, are legal, valid and binding obligations
of the
issuers thereof and (iii) in the case of Pledged Debt Securities issued
by
Parent, any Borrower or any other Subsidiary, are legal, valid and binding
obligations of the issuer thereof;
(c) except
for the security interests granted hereunder, each Grantor (i) is and,
subject
to any transfers made in compliance with the Credit Agreement, will continue
to
be the direct owner, beneficially and of record, of the Pledged Securities
indicated on Schedule II as owned by such Grantor, (ii) holds the same
free and
clear of all Liens, other than Liens created by this Agreement and Permitted
Liens, (iii) will make no assignment, pledge, hypothecation or transfer
of, or
create or permit to exist any security interest in or other Lien on, the
Pledged
Collateral, other than Liens created by this Agreement and Permitted Liens
and
(iv) will defend its title or interest hereto or therein against any and
all
Liens (other than Liens created by this Agreement and Permitted Liens),
however
arising, of all Persons;
12
(d) except
for restrictions and limitations imposed by the Loan Documents, the Pledged
Collateral is and will continue to be freely transferable and assignable
(subject to restrictions imposed under applicable law), and none of the
Pledged
Collateral is 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 Collateral hereunder, the sale or disposition thereof pursuant
hereto or the exercise by the Collateral Agent of rights and remedies
hereunder;
(e) each
Grantor has the power and authority to pledge the Pledged Collateral pledged
by
it hereunder in the manner hereby done or contemplated;
(f) no
consent or approval of any Governmental Authority, any securities exchange
or
any other Person was or is necessary to the validity of the pledge effected
hereby (other than such as have been obtained and are in full force and
effect);
(g) by
virtue
of the execution and delivery by the Grantors of this Agreement, when any
Pledged Securities are delivered to the Collateral Agent in accordance
with this
Agreement, the Collateral Agent will obtain a legal, valid and perfected
first
priority lien upon and security interest in such Pledged Securities as
security
for the payment and performance of the Obligations; and
(h) the
pledge effected hereby is effective to vest in the Collateral Agent, for
the
benefit of the Secured Parties, the rights of the Collateral Agent in the
Pledged Collateral as set forth herein.
Section
3.04. Certification
of Limited Liability Company and Limited Partnership Interests.
Each
interest in any limited liability company or limited partnership controlled
by
any Grantor and pledged hereunder shall be represented by a certificate,
shall
be a “security” within the meaning of Article 8 of the New York UCC and shall be
governed by Article 8 of the New York UCC.
Section
3.05. Registration
in Nominee Name; Denominations.
The
Collateral Agent, on behalf of the Secured Parties, shall have the right
(in its
sole and absolute discretion) to hold the Pledged Securities in its own
name as
pledgee, the name of its nominee (as pledgee or as sub-agent) or the name
of the
applicable Grantor, endorsed or assigned in blank or in favor of the Collateral
Agent. Upon Collateral Agent’s request, each Grantor will promptly give to the
Collateral Agent copies of any notices or other communications received
by it
with respect to Pledged Securities registered in the name of such Grantor.
The
Collateral Agent shall at all times have the right to exchange the certificates
representing Pledged Securities for certificates of smaller or larger
denominations for any purpose consistent with this Agreement.
Section
3.06. Voting
Rights; Dividends and Interest, etc.
(a)
Unless
and until an Event of Default shall have occurred and be
continuing:
(i)
Each
Grantor shall be entitled to exercise any and all voting and/or other consensual
rights and powers inuring to an owner of Pledged Securities or any part
thereof
for any purpose consistent with the terms of this Agreement, the Credit
Agreement and the other Loan Documents; provided
that
such rights and powers shall not be exercised in any manner that could
materially and adversely affect the rights inuring to a holder of any Pledged
Securities, the rights and remedies of any of the Collateral Agent or the
other
Secured Parties under this Agreement, the Credit Agreement or any other
Loan
Document or the ability of the Secured Parties to exercise the
same.
13
(ii)
Subject
to paragraphs (b) and (c) of this Section 3.06, the Collateral Agent authorizes
each Grantor to exercise the voting and/or consensual rights and powers
it is
entitled to exercise pursuant to subparagraph (i) above and to receive
the cash
dividends it is entitled to receive pursuant to subparagraph (iii) below.
(iii)
Each
Grantor shall be entitled to receive and retain any and all dividends,
interest,
principal and other distributions paid on or distributed in respect of
the
Pledged Securities to the extent and only to the extent that such dividends,
interest, principal and other distributions are permitted by, and otherwise
paid
or distributed in accordance with, the terms and conditions of the Credit
Agreement, the other Loan Documents and applicable laws; provided
that any
noncash dividends, interest, principal or other distributions that would
constitute Pledged Stock or Pledged Debt Securities, whether resulting
from a
subdivision, combination or reclassification of the outstanding Equity
Interests
of the issuer of any Pledged Securities or received in exchange for Pledged
Securities or any part thereof, or in redemption thereof, or as a result
of any
merger, consolidation, acquisition or other exchange of assets to which
such
issuer may be a party or otherwise, shall be and become part of the Pledged
Collateral, and, if received by any Grantor, shall not be commingled by
such
Grantor with any of its other funds or property but shall be held separate
and
apart therefrom, shall be held in trust for the benefit of the Collateral
Agent
and shall be forthwith delivered to the Collateral Agent in the same form
as so
received (with any necessary endorsement).
(b) Upon
the
occurrence and during the continuance of an Event of Default, all rights
of any
Grantor to dividends, interest, principal or other distributions that such
Grantor is authorized to receive pursuant to paragraph (a)(iii) of this
Section
3.06 shall cease, and all such rights shall thereupon become vested in
the
Collateral Agent, which shall have the sole and exclusive right and authority
to
receive and retain such dividends, interest, principal or other distributions.
All dividends, interest, principal or other distributions received by any
Grantor contrary to the provisions of this Section 3.06 shall be held in
trust
for the benefit of the Collateral Agent, shall be segregated from other
property
or funds of such Grantor and shall be forthwith delivered to the Collateral
Agent in the same form as so received (with any necessary endorsement).
Any and
all money and other property paid over to or received by the Collateral
Agent
pursuant to the provisions of this paragraph (b) shall be retained by the
Collateral Agent in an account to be established by the Collateral Agent
upon
receipt of such money or other property and shall be applied in accordance
with
the provisions of Section 5.02. After all Events of Default have been cured
or
waived and the Borrowers have delivered to the Collateral Agent a certificate
to
that effect, the Collateral Agent shall promptly repay to each Grantor
(without
interest) all dividends, interest, principal or other distributions that
such
Grantor would otherwise be permitted to retain pursuant to the terms of
paragraph (a)(iii) of this Section 3.06 and that remain in such
account.
(c) Upon
the
occurrence and during the continuance of an Event of Default, all rights
of any
Grantor to exercise the voting and consensual rights and powers it is entitled
to exercise pursuant to paragraph (a)(i) of this Section 3.06, and the
obligations of the Collateral Agent under paragraph (a)(ii) of this Section
3.06, shall cease, and all such rights shall thereupon become vested in
the
Collateral Agent, which shall have the sole and exclusive right and authority
to
exercise such voting and consensual rights and powers; provided
that,
unless otherwise directed by the Required Lenders, the Collateral Agent
shall
have the right, from time to time following and during the continuance
of an
Event of Default to permit the Grantors to exercise such rights. After
all
Events of Default have been cured or waived and the Borrowers have delivered
to
the Collateral Agent a certificate to that effect, each Grantor will have
the
right to exercise the voting and consensual rights and powers that such
Grantor
would otherwise be entitled to exercise pursuant to the terms of paragraph
(a)(i) above.
14
ARTICLE
IV
Security
Interests in Personal Property
Section
4.01. Security
Interest.
(a)
Each Grantor hereby ratifies and affirms its pledge, assignment and grant
of
security interest made pursuant to Section 4.01 of the Existing Guarantee
and
Collateral Agreement, and, for the avoidance of doubt, as security for
the
payment or performance, as the case may be, in full of the Obligations,
each
Grantor hereby assigns and pledges to the Collateral Agent, its successors
and
assigns, for the benefit of the Secured Parties, and hereby grants to the
Collateral Agent, its successors and assigns, for the benefit of the Secured
Parties, a security interest (the “Security
Interest”)
in all
right, title and interest in or to any and all of the following assets
and
properties 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 “Article
9 Collateral”):
(i)
all
Accounts;
(ii)
all
Chattel Paper;
(iii)
all
cash
and Deposit Accounts;
(iv)
all
Documents;
(v)
all
Equipment;
(vi)
all
General Intangibles;
(vii)
all
Instruments;
(viii)
all
Inventory;
(ix)
all
Investment Property;
(x)
all
insurance claims and proceeds;
(xi)
all
Letter-of-credit rights;
(xii)
all
books
and records pertaining to the Article 9 Collateral; and
(xiii)
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.
(b) Each
Grantor hereby irrevocably authorizes the Collateral Agent at any time
and from
time to time to file in any relevant jurisdiction any initial financing
statements (including fixture filings) with respect to the Article 9 Collateral
or any part thereof and amendments thereto that contain the information
required
by Article 9 of the Uniform Commercial Code of each applicable jurisdiction
for
the filing of any financing statement or amendment, including (i) whether
such
Grantor is an organization, the type of organization and any organizational
identification number issued to such Grantor, (ii) in the case of a financing
statement filed as a fixture filing, a sufficient description of the real
property to which such Article 9 Collateral relates and (iii) a description
of
collateral that describes such property in any other manner as the Collateral
Agent may reasonably determine is necessary or advisable to ensure the
perfection of the security interest in the Article 9 Collateral granted
to the
Collateral Agent, including describing such property as “all assets” or “all
property”. Each Grantor agrees to provide such information to the Collateral
Agent promptly upon request.
15
Each
Grantor also ratifies its authorization for the Collateral Agent to file
in any
relevant jurisdiction any initial financing statements or amendments thereto
if
filed prior to the date hereof.
The
Collateral Agent is further authorized to file with the United States Patent
and
Trademark Office or United States Copyright Office (or any successor office
or
any similar office in any other country) such documents as may be necessary
or
advisable for the purpose of perfecting, confirming, continuing, enforcing
or
protecting the Security Interest granted by each Grantor, without the signature
of any Grantor, and naming any Grantor or the Grantors as debtors and the
Collateral Agent as secured party.
(c) The
Security Interest is granted as security only and shall not subject the
Collateral Agent or any other Secured Party to, or in any way alter or
modify,
any obligation or liability of any Grantor with respect to or arising out
of the
Article 9 Collateral.
Section
4.02. Representations
and Warranties.
The
Grantors jointly and severally represent and warrant to the Collateral
Agent and
the Secured Parties that:
(a) Each
Grantor has good and valid rights in and title to the Article 9 Collateral
with
respect to which it has purported to grant a Security Interest hereunder
and has
full power and authority to grant to the Collateral Agent the Security
Interest
in such Article 9 Collateral pursuant hereto and to execute, deliver and
perform
its obligations in accordance with the terms of this Agreement, without
the
consent or approval of any other person other than any consent or approval
that
has been obtained and is in full force and effect.
(b) The
Perfection Certificate has been duly prepared, completed and executed and
the
information set forth therein, including the exact legal name of each Grantor,
is correct and complete as of the Closing Date. Uniform Commercial Code
financing statements (including fixture filings, as applicable) or other
appropriate filings, recordings or registrations containing a description
of the
Article 9 Collateral have been prepared and filed by the Collateral Agent
in
connection with the Existing Guarantee and Collateral Agreement and such
filings, recordings or registrations are consistent with the information
provided to the Collateral Agent in the Perfection Certificate delivered
in
connection with this Agreement and remain appropriate for filing in each
governmental, municipal or other office specified in Schedule 6 to the
Perfection Certificate (or specified by notice from the Borrowers to the
Collateral Agent after the Closing Date in the case of filings, recordings
or
registrations required by Section 5.12 or 5.14 of the Credit Agreement),
and
constitute all the filings, recordings and registrations (other than filings
required to be made in the United States Patent and Trademark Office and
the
United States Copyright Office in order to perfect the Security Interest
in
Article 0 Xxxxxxxxxx xxxxxxxxxx xx Xxxxxx Xxxxxx Patents, Trademarks and
Copyrights) that are necessary to publish notice of and protect the validity
of
and to establish a legal, valid and perfected security interest in favor
of the
Collateral Agent (for the benefit of the Secured Parties) in respect of
all
Article 9 Collateral in which the Security Interest may be perfected by
filing,
recording or registration in the United States (or any political subdivision
thereof) and its territories and possessions, and no further or subsequent
filing, refiling, recording, rerecording, registration or reregistration
is
necessary in any such jurisdiction, except as provided under applicable
law with
respect to the filing of continuation statements or amendments. Each Grantor
represents and warrants that a fully executed agreement in the form hereof
or in
a form reasonably satisfactory to the Collateral Agent containing a description
of all Article 9 Collateral consisting of Intellectual Property with respect
to
United States registered Patents (and Patents for which United States
registration applications are pending), United States registered Trademarks
(and
Trademarks for which United States registration applications are pending)
and
United States registered Copyrights (and Copyrights for which United States
registration applications are pending) has been delivered to the Collateral
Agent for recording with the United States Patent and Trademark Office
and the
United States Copyright Office pursuant to 35 U.S.C. § 261, 15 U.S.C. § 1060 or
17 U.S.C. § 205 and the regulations thereunder, as applicable, and otherwise as
may be required pursuant to the laws of any other applicable jurisdiction
and
reasonably requested by the Collateral Agent, to protect the validity of
and to
establish a legal, valid and perfected security interest in favor of the
Collateral Agent (for the benefit of the Secured Parties) in respect of
all
Article 9 Collateral consisting of such Intellectual Property in which
a
security interest may be perfected by recording with the United States
Patent
and Trademark Office and the United States Copyright Office, and no further
or
subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary (other than such actions as are necessary to
perfect
the Security Interest with respect to any Article 9 Collateral consisting
of
Patents, Trademarks and Copyrights (or registration or application for
registration thereof) acquired or developed after the date hereof).
16
(c) The
Security Interest constitutes (i) a legal and valid security interest in
all the
Article 9 Collateral securing the payment and performance of the Obligations,
(ii) subject to the filings described in Section 4.02(b), a perfected security
interest in all Article 9 Collateral in which a security interest may be
perfected by filing, recording or registering a financing statement or
analogous
document in the United States (or any political subdivision thereof) and
its
territories and possessions pursuant to the Uniform Commercial Code or
other
applicable law in such jurisdictions and (iii) a security interest that
shall be
perfected in all Article 9 Collateral in which a security interest may
be
perfected upon the receipt and recording of this Agreement with the United
States Patent and Trademark Office and the United States Copyright Office,
as
applicable, and otherwise as may be required pursuant to the laws of any
other
applicable jurisdiction. The Security Interest is and shall be prior to
any
other Lien on any of the Article 9 Collateral, other than Liens expressly
permitted to be prior to the Security Interest pursuant to Section 6.02
of the
Credit Agreement.
(d) The
Article 9 Collateral is owned by the Grantors free and clear of any Lien,
other
than Liens expressly permitted pursuant to Section 6.02 of the Credit Agreement.
None of the Grantors has filed or consented to the filing of (i) any financing
statement or analogous document under the Uniform Commercial Code or any
other
applicable laws covering any Article 9 Collateral, (ii) any assignment
in which
any Grantor assigns any Article 9 Collateral or any security agreement
or
similar instrument covering any Article 9 Collateral with the United States
Patent and Trademark Office or the United States Copyright Office or (iii)
any
assignment in which any Grantor assigns any Article 9 Collateral or any
security
agreement or similar instrument covering any Article 9 Collateral with
any
foreign governmental, municipal or other office, which financing statement
or
analogous document, assignment, security agreement or similar instrument
is
still in effect, except, in each case, for Liens expressly permitted pursuant
to
Section 6.02 of the Credit Agreement.
(e) None
of
the Grantors holds any Commercial Tort Claim as of the Closing Date except
as
indicated on the Perfection Certificate.
(f) All
Accounts have been originated by the Grantors and all Inventory has been
acquired by the Grantors in the ordinary course of business.
Section
4.03. Covenants.
(a) Each
Grantor agrees promptly to notify the Collateral Agent in writing of any
change
(i) in its corporate name, (ii) in the location of any office in which
it
maintains books or records relating to Article 9 Collateral owned by it
or any
office or facility at which Article 9 Collateral owned by it is located
(including the establishment of any new such office or facility), (iii)
in its
identity or type of organization or corporate structure, (iv) in its Federal
Taxpayer Identification Number or organizational identification number
or (v) in
its jurisdiction of organization. Each Grantor agrees promptly to provide
the
Collateral Agent with certified organizational documents reflecting any
of the
changes described in clauses (i), (iii) and (v) of the immediately preceding
sentence. Each Grantor agrees not to effect or permit any change referred
to in
the first sentence of this paragraph (a) unless all filings have been made
under
the Uniform Commercial Code or otherwise that are required in order for
the
Collateral Agent to continue at all times following such change to have
a valid,
legal and perfected first priority security interest in all the Article
9
Collateral. Each Grantor agrees promptly to notify the Collateral Agent
if any
material portion of the Article 9 Collateral owned or held by such Grantor
is
damaged or destroyed.
17
(b) Each
Grantor agrees to maintain, at its own cost and expense, such complete
and
accurate records with respect to the Article 9 Collateral owned by it as
is
consistent with its current practices and in accordance with reasonably
prudent
and standard practices used in industries that are the same as or similar
to
those in which such Grantor is engaged, but in any event to include complete
accounting records indicating all payments and proceeds received with respect
to
any part of the Article 9 Collateral, and, at such time or times as the
Collateral Agent may reasonably request, promptly to prepare and deliver
to the
Collateral Agent a duly certified schedule or schedules in form and detail
satisfactory to the Collateral Agent showing the identity, amount and location
of any and all Article 9 Collateral.
(c) Each
year, at the time of delivery of annual financial statements with respect
to the
preceding fiscal year pursuant to Section 5.04(a) of the Credit Agreement,
the
Borrowers shall deliver to the Collateral Agent a certificate executed
by a
Financial Officer and a legal officer of the Borrowers (i) setting forth
the
information required pursuant to Schedule 6 of 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 certificate delivered pursuant
to this Section 4.03(c) and (ii) certifying that all Uniform Commercial
Code
financing statements (including fixture filings, as applicable) or other
appropriate filings, recordings or registrations, including all refilings,
rerecordings and reregistrations, containing a description of the Collateral
have been filed of record in each governmental, municipal or other appropriate
office in each jurisdiction identified pursuant to clause (i) of this Section
4.03(c) to the extent necessary to protect and perfect the Security Interest
for
a period of not less than 18 months after the date of such certificate
(except
as noted therein with respect to any continuation statements to be filed
within
such period). Each certificate delivered pursuant to this Section 4.03(c)
shall
identify in the format of Schedule III to this Agreement all Intellectual
Property of any Grantor in existence on the date thereof and not then listed
on
such Schedules or previously so identified to the Collateral Agent.
(d) Each
Grantor shall, at its own expense, take any and all actions necessary to
defend
title to the Article 9 Collateral against all Persons and to defend the
Security
Interest of the Collateral Agent in the Article 9 Collateral and the priority
thereof against any Lien not expressly permitted to be prior to the Security
Interest pursuant to Section 6.02 of the Credit Agreement.
(e) Each
Grantor agrees, at its own expense, to execute, acknowledge, deliver and
cause
to be duly filed all such further instruments and documents and take all
such
actions as the Collateral Agent may from time to time reasonably request
to
better assure, preserve, protect and perfect the Security Interest and
the
rights and remedies created hereby, including the payment of any fees and
taxes
required in connection with the execution and delivery of this Agreement,
the
granting of the Security Interest and the filing of any financing statements
(including fixture filings) or other documents in connection herewith or
therewith.
18
Without
limiting the generality of the foregoing, each Grantor hereby authorizes
the
Collateral Agent, with prompt notice thereof to the Grantors, to supplement
this
Agreement by supplementing Schedule III or adding additional schedules
hereto to
specifically identify any asset or item that may constitute Copyrights,
Licenses, Patents or Trademarks; provided
that any
Grantor shall have the right, exercisable within 10 days after it has been
notified by the Collateral Agent of the specific identification of such
Article
9 Collateral, to advise the Collateral Agent in writing of any inaccuracy
of the
representations and warranties made by such Grantor hereunder with respect
to
such Article 9 Collateral. Each Grantor agrees that it will use its commercially
reasonable efforts to take such action as shall be necessary in order that
all
representations and warranties hereunder shall be true and correct with
respect
to such Article 9 Collateral within 30 days after the date it has been
notified
by the Collateral Agent of the specific identification of such Article
9
Collateral.
(f) The
Collateral Agent and such Persons as the Collateral Agent may reasonably
designate shall have the right, at the Grantors’ own cost and expense, to
inspect the Article 9 Collateral, all records related thereto (and to make
extracts and copies from such records) and the premises upon which any
of the
Article 9 Collateral is located, at reasonable times and intervals during
normal
business hours upon reasonable advance notice to the respective Grantor,
to
discuss the Grantors’ affairs with the officers of the Grantors and their
independent accountants and to verify under reasonable procedures, in accordance
with Section 5.07 of the Credit Agreement, the validity, amount, quality,
quantity, value, condition and status of, or any other matter relating
to, the
Article 9 Collateral, including, in the case of Accounts or Article 9 Collateral
in the possession of any third person, by contacting Account Debtors or
the
third person possessing such Article 9 Collateral for the purpose of making
such
a verification. Subject to Section 9.12 of the Credit Agreement, the Collateral
Agent shall have the right to share any information it gains from such
inspection or verification with any Secured Party.
(g) At
its
option, the Collateral Agent may discharge past due taxes, assessments,
charges,
fees, Liens, security interests or other encumbrances at any time levied
or
placed on the Article 9 Collateral and not permitted pursuant to Section
6.02 of
the Credit Agreement, and may pay for the maintenance and preservation
of the
Article 9 Collateral to the extent any Grantor fails to do so as required
by the
Credit Agreement or this Agreement, and each Grantor jointly and severally
agrees to reimburse the Collateral Agent on demand for any payment made
or any
expense incurred by the Collateral Agent pursuant to the foregoing
authorization; provided,
however, that nothing in this Section 4.03(g) shall be interpreted as excusing
any Grantor from the performance of, or imposing any obligation on the
Collateral Agent or any Secured Party to cure or perform, any covenants
or other
promises of any Grantor with respect to taxes, assessments, charges, fees,
Liens, security interests or other encumbrances and maintenance as set
forth
herein or in the other Loan Documents.
(h) If
at any
time any Grantor shall take a security interest in any property of an Account
Debtor or any other Person to secure payment and performance of an Account,
such
Grantor shall promptly assign such security interest to the Collateral
Agent to
the extent permitted by any contracts or arrangements to which such property
is
subject. Such assignment need not be filed of public record unless necessary
to
continue the perfected status of the security interest against creditors
of and
transferees from the Account Debtor or other Person granting the security
interest.
(i) Each
Grantor shall remain liable to observe and perform all the conditions and
obligations to be observed and performed by it under each contract, agreement
or
instrument relating to the Article 9 Collateral, all in accordance with
the
terms and conditions thereof, and each Grantor jointly and severally agrees
to
indemnify and hold harmless the Collateral Agent and the Secured Parties
from
and against any and all liability for such performance.
19
(j) None
of
the Grantors shall make or permit to be made an assignment, pledge or
hypothecation of the Article 9 Collateral or shall grant any other Lien
in
respect of the Article 9 Collateral, except as expressly permitted by the
Credit
Agreement. None of the Grantors shall make or permit to be made any transfer
of
the Article 9 Collateral and each Grantor shall remain at all times in
possession of the Article 9 Collateral owned by it, except that (i) Inventory
may be sold in the ordinary course of business and (ii) unless and until
the
Collateral Agent shall notify the Grantors that an Event of Default shall
have
occurred and be continuing and that during the continuance thereof the
Grantors
shall not sell, convey, lease, assign, transfer or otherwise dispose of
any
Article 9 Collateral (which notice may be given by telephone if promptly
confirmed in writing), the Grantors may use and dispose of the Article
9
Collateral in any lawful manner not inconsistent with the provisions of
this
Agreement, the Credit Agreement or any other Loan Document. Without limiting
the
generality of the foregoing, each Grantor agrees that it shall not permit
any
Inventory to be in the possession or control of any warehouseman, bailee,
agent
or processor at any time unless such warehouseman, bailee, agent or processor
shall have been notified of the Security Interest and shall have acknowledged
in
writing, in form and substance reasonably satisfactory to the Collateral
Agent,
that such warehouseman, agent, bailee or processor holds the Inventory
for the
benefit of the Collateral Agent subject to the Security Interest and shall
act
upon the instructions of the Collateral Agent without further consent from
the
Grantor, and that such warehouseman, bailee, agent or processor further
agrees
to waive and release any Lien held by it with respect to such Inventory,
whether
arising by operation of law or otherwise; provided
that
such written acknowledgment shall not be required until the fair market
value of
all Inventory in such possession or under such control exceeds $1,000,000
in
aggregate amount.
(k) None
of
the Grantors will, without the Collateral Agent’s prior written consent, grant
any extension of the time of payment of any Accounts included in the Article
9
Collateral, compromise, compound or settle the same for less than the full
amount thereof, release, wholly or partly, any Person liable for the payment
thereof or allow any credit or discount whatsoever thereon, other than
extensions, credits, discounts, compromises or settlements granted or made
in
the ordinary course of business and consistent with its current practices
and in
accordance with reasonably prudent and standard practice used in industries
that
are the same as or similar to those in which such Grantor is
engaged.
(l) The
Grantors, 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 Schedule IV hereto and Section
5.02 of the Credit Agreement. Each Grantor irrevocably makes, constitutes
and
appoints the Collateral Agent (and all officers, employees or agents designated
by the Collateral Agent) as such Grantor’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 Article
9
Collateral under policies of insurance, endorsing the name of such Grantor
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 Grantor 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 Collateral Agent may,
without
waiving or releasing any obligation or liability of the Grantors 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 Collateral Agent deems advisable. All sums disbursed by
the
Collateral Agent in connection with this Section 4.03(l), including reasonable
attorneys’ fees, court costs, expenses and other charges relating thereto, shall
be payable, upon demand, by the Grantors to the Collateral Agent and shall
be
additional Obligations secured hereby.
(m) Each
Grantor shall maintain, in form and manner reasonably satisfactory to the
Collateral Agent, its Chattel Paper and its books, records and documents
evidencing or pertaining thereto with an appropriate reference to the fact
that
such Chattel Paper has been assigned to the Collateral Agent for the benefit
of
the Secured Parties and that the Collateral Agent has a security interest
therein.
20
Section
4.04. Other
Actions.
In
order to further insure the attachment, perfection and priority of, and
the
ability of the Collateral Agent to enforce, the Collateral Agent’s security
interest in the Article 9 Collateral, each Grantor agrees, in each case
at such
Grantor’s own expense, to take the following actions with respect to the
following Article 9 Collateral:
(a) Instruments
and Tangible Chattel Paper.
If any
Grantor shall at any time hold or acquire any Tangible Chattel Paper having
a
value in excess of $10,000, such Grantor shall forthwith endorse, assign
and
deliver the same to the Collateral Agent, accompanied by such instruments
of
transfer or assignment duly executed in blank as the Collateral Agent may
from
time to time reasonably request.
(b) Deposit
Accounts.
(i)
(x)
For
deposit accounts holding in the aggregate at least 80% of all amounts held
by
all Grantors in all deposit accounts that are maintained as of the Closing
Date,
the applicable Grantors shall execute and deliver, and cause the bank with
which
such Grantor maintains such deposit accounts (each such bank a “Deposit
Account Bank”)
to
execute and deliver Deposit Account Control Agreements as required by Section
5.13 of the Credit Agreement and (y) for any deposit account that any Grantor
at
any time opens after the Closing Date, such Grantor shall execute and deliver,
and use its best efforts to cause the Deposit Account Bank in which any
such
deposit account is maintained to execute and deliver, a Deposit Account
Control
Agreement; provided,
that no
Grantor shall permit the aggregate amount held in any such deposit account
opened after the Closing Date for which the applicable Deposit Account
Bank has
not executed and delivered a Deposit Account Control Agreement to exceed
$25,000
at any one time. The Grantors shall not permit the aggregate amount held
in
accounts for which no Deposit Account Control Agreement has been executed
by a
Deposit Account Bank and delivered to the Administrative Agent to exceed
$500,000 at any time. Grantors will maintain cash management systems reasonably
acceptable to the Collateral Agent (it being understood that the cash management
system as in effect on the Closing Date is acceptable to the Collateral
Agent).
The provisions of this clause (i) shall not apply to any deposit account
for
which the Collateral Agent is the Deposit Account Bank or the customer
of such
bank with respect to such deposit account.
(ii)
Each
Grantor acknowledges and agrees that (x) the funds on deposit in the deposit
accounts shall continue to be collateral security for all the Obligations
and
(y) upon the occurrence and during the continuance of an Event of Default
and if
expressly consented to in writing by the Required Lenders (which consent
may not
be unreasonably withheld), the funds on deposit in such deposit accounts
shall
be applied as provided in Section 5.02. Each Grantor irrevocably authorizes
the
Collateral Agent to (A) notify each Sub-Agent of the occurrence of an Event
of
Default and (B) following the occurrence of an Event of Default and if
expressly
consented to in writing by the Required Lenders (which consent may not
be
unreasonably withheld), instruct each Sub-Agent to apply the funds on deposit
in
such deposit account in accordance with Section 5.02. Each Grantor hereby
agrees
to irrevocably direct each Sub-Agent to comply with the instructions of
the
Collateral Agent with respect to the relevant deposit account without further
consent from the Grantor or any other Person.
(c) Investment
Property.
Except
to the extent otherwise provided in Article III, if any Grantor shall at
any
time hold or acquire any Certificated Security having a value in excess
of
$10,000, such Grantor shall forthwith endorse, assign and deliver the same
to
the Collateral Agent, accompanied by such instruments of transfer or assignment
duly executed in blank as the Collateral Agent may from time to time specify.
If
any securities now or hereafter acquired by any Grantor are uncertificated
and
are issued to such Grantor or its nominee directly by the issuer thereof,
such
Grantor shall immediately notify the Collateral Agent thereof and, at the
Collateral Agent’s request and option, pursuant to an agreement in form and
substance reasonably satisfactory to the Collateral Agent, either (i) cause
the
issuer to agree to comply with instructions from the Collateral Agent as
to such
securities, without further consent of any Grantor or such nominee, or
(ii)
arrange for the Collateral Agent to become the registered owner of the
securities. If any securities, whether certificated or uncertificated,
or other
investment property now or hereafter acquired by any Grantor are held by
such
Grantor or its nominee through a securities intermediary or commodity
intermediary, such Grantor shall immediately notify the Collateral Agent
thereof
and, at the Collateral Agent’s request and option, pursuant to an agreement in
form and substance reasonably satisfactory to the Collateral Agent, either
(A)
cause such securities intermediary or (as the case may be) commodity
intermediary to agree to comply with entitlement orders or other instructions
from the Collateral Agent to such securities intermediary as to such securities
or other investment property or (as the case may be) to apply any value
distributed on account of any commodity contract as directed by the Collateral
Agent to such commodity intermediary, in each case without further consent
of
any Grantor or such nominee, or (B) in the case of Financial Assets or
other
Investment Property held through a securities intermediary, arrange for
the
Collateral Agent to become the entitlement holder with respect to such
investment property, with the Grantor being permitted, only with the consent
of
the Collateral Agent, to exercise rights to withdraw or otherwise deal
with such
investment property. The Collateral Agent agrees with each of the Grantors
that
the Collateral Agent shall not give any such entitlement orders or instructions
or directions to any such issuer, securities intermediary or commodity
intermediary, and shall not withhold its consent to the exercise of any
withdrawal or dealing rights by any Grantor, unless an Event of Default
has
occurred and is continuing or, after giving effect to any such investment
and
withdrawal rights, would occur. The provisions of this paragraph (c) shall
not
apply to any financial assets credited to a securities account for which
the
Collateral Agent is the securities intermediary.
21
(d) Electronic
Chattel Paper and Transferable Records.
If any
Grantor at any time holds or acquires an interest in any Electronic Chattel
Paper or any “transferable record” having a value in excess of $10,000, as that
term is defined in Section 201 of the Federal Electronic Signatures in
Global
and National Commerce Act or in Section 16 of the Uniform Electronic
Transactions Act as in effect in any relevant jurisdiction, such Grantor
shall
promptly notify the Collateral Agent thereof and, at the request of the
Collateral Agent, shall take such action as the Collateral Agent may reasonably
request to vest in the Collateral Agent control under New York UCC Section
9-105
of such Electronic Chattel Paper or control under Section 201 of the Federal
Electronic Signatures in Global and National Commerce Act or, as the case
may
be, Section 16 of the Uniform Electronic Transactions Act, as so in effect in
such jurisdiction, of such transferable record. The Collateral Agent agrees
with
such Grantor that the Collateral Agent will arrange, pursuant to procedures
reasonably satisfactory to the Collateral Agent and so long as such procedures
will not result in the Collateral Agent’s loss of control, for the Grantor to
make alterations to the Electronic Chattel Paper or transferable record
permitted under UCC Section 9-105 or, as the case may be, Section 201 of
the
Federal Electronic Signatures in Global and National Commerce Act or Section
16
of the Uniform Electronic Transactions Act for a party in control to allow
without loss of control, unless an Event of Default has occurred and is
continuing or would occur after taking into account any action by such
Grantor
with respect to such Electronic Chattel Paper or transferable
record.
(e) Letter-of-Credit
Rights.
If any
Grantor is at any time a beneficiary under a letter of credit having a
stated
amount in excess of $10,000 now or hereafter issued in favor of such Grantor,
such Grantor shall promptly notify the Collateral Agent thereof and, at
the
request and option of the Collateral Agent, such Grantor shall, pursuant
to an
agreement in form and substance satisfactory to the Collateral Agent, either
(i)
arrange for the issuer and any confirmer of such letter of credit to consent
to
an assignment to the Collateral Agent of the proceeds of any drawing under
the
letter of credit or (ii) arrange for the Collateral Agent to become the
transferee beneficiary of the letter of credit, with the Collateral Agent
agreeing, in each case, that the proceeds of any drawing under the letter
of
credit are to be paid to the applicable Grantor unless an Event of Default
has
occurred or is continuing.
22
(f) Commercial
Tort Claims.
If any
Grantor shall at any time hold or acquire a Commercial Tort Claim in an
amount
reasonably estimated to exceed $1,000,000, the Grantor shall promptly notify
the
Collateral Agent thereof in a writing signed by such Grantor, including
a
summary description of such claim, and grant to the Collateral Agent in
writing
a security interest therein and in the proceeds thereof, all upon the terms
of
this Agreement, with such writing to be in form and substance reasonably
satisfactory to the Collateral Agent.
Section
4.05. Covenants
Regarding Patent, Trademark and Copyright Collateral.
(a) Each
Grantor agrees that it will not do any act or omit to do any act (and will
exercise commercially reasonable efforts to prevent its licensees from
doing any
act or omitting to do any act) whereby any Patent that is material to the
conduct of such Grantor’s business may become invalidated or dedicated to the
public, and agrees that it shall continue to xxxx any products covered
by a
Patent with the relevant patent number as necessary and sufficient to establish
and preserve its maximum rights under applicable patent laws.
(b) Each
Grantor (either itself or through its licensees or its sublicensees) will,
for
each Trademark material to the conduct of such Grantor’s business, (i) maintain
such Trademark in full force free from any claim of abandonment or invalidity
for non-use, (ii) maintain the quality of products and services offered
under
such Trademark, (iii) display such Trademark with notice of Federal or
foreign
registration to the extent necessary and sufficient to establish and preserve
its maximum rights under applicable law and (iv) not knowingly use or knowingly
permit the use of such Trademark in violation of any third-party
rights.
(c) Each
Grantor (either itself or through its licensees or its sublicensees) will,
for
each work covered by a Copyright material to the conduct of such Grantor’s
business, continue to publish, reproduce, display, adopt and distribute
the work
with appropriate copyright notice as necessary and sufficient to establish
and
preserve its maximum rights under applicable copyright laws.
(d) Each
Grantor shall notify the Collateral Agent immediately if it knows or has
reason
to know that any Patent, Trademark or Copyright material to the conduct
of such
Grantor’s business may become abandoned, lost or dedicated to the public, or of
any materially adverse determination or development (including the institution
of, or any such determination or development in, any proceeding in the
United
States Patent and Trademark Office, United States Copyright Office or any
court
or similar office of any country) regarding such Grantor’s ownership of any such
Patent, Trademark or Copyright, its right to register the same or its right
to
keep and maintain the same.
(e) In
no
event shall any Grantor, either itself or through any agent, employee,
licensee
or designee, file an application for any Patent or for the registration
of any
Trademark or Copyright with the United States Patent and Trademark Office,
the
United States Copyright Office or any office or agency in any political
subdivision of the United States or in any other country or any political
subdivision thereof, unless it promptly informs the Collateral Agent thereof,
and, upon the request of the Collateral Agent, executes and delivers any
and all
agreements, instruments, documents and papers as the Collateral Agent may
reasonably request to evidence the Collateral Agent’s security interest in such
Patent, Trademark or Copyright, and each Grantor hereby appoints the Collateral
Agent as its attorney-in-fact to execute and file such writings for the
foregoing purposes, all acts of such attorney being hereby ratified and
confirmed; such power, being coupled with an interest, is
irrevocable.
23
(f) Each
Grantor will take all necessary steps that are consistent with the practice
in
any proceeding before the United States Patent and Trademark Office, the
United
States Copyright Office or any office or agency in any political subdivision
of
the United States or in any other country or any political subdivision
thereof
to maintain and pursue each material application relating to the Patents,
Trademarks and/or Copyrights (and to obtain the relevant grant or registration)
and to maintain each issued Patent and each registration of the Trademarks
and
Copyrights that is material to the conduct of such Grantor’s business, including
timely filings of applications for renewal, affidavits of use, affidavits
of
incontestability and payment of maintenance fees, and, if consistent with
good
business judgment, to initiate opposition, interference and cancellation
proceedings against third parties.
(g) In
the
event that any Grantor has reason to believe that any Article 9 Collateral
consisting of a material Patent, Trademark or Copyright has been or is
about to
be infringed, misappropriated or diluted by a third party, such Grantor
shall
promptly notify the Collateral Agent and shall, if consistent with good
business
judgment and if it is reasonably determined by the Grantor that there is
a
potential risk of material damage to the Patent, Trademark or Copyright,
promptly xxx for infringement, misappropriation or dilution and to recover
any
and all damages for such infringement, misappropriation or dilution, and
take
such other actions as are appropriate under the circumstances to protect
such
Article 9 Collateral.
(h) Upon
and
during the continuance of an Event of Default, each Grantor shall use
commercially reasonable efforts to obtain all requisite consents or approvals
from the licensor under each Copyright License, Patent License or Trademark
License to effect the assignment of all such Grantor’s right, title and interest
thereunder to the Collateral Agent or its designee.
ARTICLE
V
Remedies
Section
5.01. Remedies
Upon Default.
Upon
the occurrence and during the continuance of an Event of Default, each
Grantor
agrees to deliver each item of Collateral to the Collateral Agent on demand,
and
it is agreed that the Collateral Agent shall have the right to take any
of or
all the following actions at the same or different times: (a) with respect
to
any Article 9 Collateral consisting of Intellectual Property, on demand,
to
cause the Security Interest to become an assignment, transfer and conveyance
of
any of or all such Article 9 Collateral by the applicable Grantors to the
Collateral Agent or to license or sublicense, whether general, special
or
otherwise, and whether on an exclusive or nonexclusive basis, any such
Article 9
Collateral throughout the world on such terms and conditions and in such
manner
as the Collateral Agent shall determine (other than in violation of any
then-existing licensing arrangements to the extent that waivers cannot
be
obtained); and (b) with or without legal process and with or without prior
notice or demand for performance, to take possession of the Article 9 Collateral
and without liability for trespass to enter any premises where the Article
9
Collateral may be located for the purpose of taking possession of or removing
the Article 9 Collateral and, generally, to exercise any and all rights
afforded
to a secured party under the Uniform Commercial Code or other applicable
law.
Without limiting the generality of the foregoing, each Grantor agrees that
the
Collateral Agent shall have the right, subject to the mandatory requirements
of
applicable law, to sell or otherwise dispose of all or any part of the
Collateral at a public or private sale or at any broker’s board or on any
securities exchange, for cash, upon credit or for future delivery as the
Collateral Agent shall deem appropriate. The Collateral Agent shall be
authorized at any such sale of securities (if it deems it advisable to
do so) to
restrict the prospective bidders or purchasers to Persons who will represent
and
agree that they are purchasing the Collateral for their own account for
investment and not with a view to the distribution or sale thereof, and
upon
consummation of any such sale of Collateral the Collateral Agent shall
have the
right to assign, transfer and deliver to the purchaser or purchasers thereof
the
Collateral so sold. Each such purchaser at any such sale shall hold the
property
sold absolutely, free from any claim or right on the part of any Grantor,
and
each Grantor hereby waives and releases (to the extent permitted by law)
all
rights of redemption, stay, valuation and appraisal that such Grantor now
has or
may at any time in the future have under any rule of law or statute now
existing
or hereafter enacted.
24
The
Collateral Agent shall give the applicable Grantors 10 days’ written notice
(which each Grantor agrees is reasonable notice within the meaning of Section
9-611 of the New York UCC or its equivalent in other jurisdictions) of
the
Collateral Agent’s intention to make any sale of Collateral. Such notice, in the
case of a public sale, shall state the time and place for such sale and,
in the
case of a sale at a broker’s board or on a securities exchange, shall state the
board or exchange at which such sale is to be made and the day on which
the
Collateral, or portion thereof, will first be offered for sale at such
board or
exchange. Any such public sale shall be held at such time or times within
ordinary business hours and at such place or places as the Collateral Agent
may
fix and state in the notice (if any) of such sale. At any such sale, the
Collateral, or portion thereof, to be sold may be sold in one lot as an
entirety
or in separate parcels, as the Collateral Agent may (in its sole and absolute
discretion) determine. The Collateral Agent shall not be obligated to make
any
sale of any Collateral if it shall determine not to do so, regardless of
the
fact that notice of sale of such Collateral shall have been given. The
Collateral 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 Collateral is made on credit or for future
delivery, the Collateral so sold may be retained by the Collateral Agent
until
the sale price is paid by the purchaser or purchasers thereof, but the
Collateral Agent shall not incur any liability in case any such purchaser
or
purchasers shall fail to take up and pay for the Collateral so sold and,
in case
of any such failure, such 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 5.01, any Secured Party may bid for or purchase for cash, free
(to the
extent permitted by law) from any right of redemption, stay, valuation
or
appraisal on the part of any Grantor (all said rights being also hereby
waived
and released to the extent permitted by law), the Collateral or any part
thereof
offered for sale and such Secured Party may, upon compliance with the terms
of
sale, hold, retain and dispose of such property without further accountability
to any Grantor therefor. For purposes hereof, a written agreement to purchase
the Collateral or any portion thereof shall be treated as a sale thereof;
the
Collateral Agent shall be free to carry out such sale pursuant to such
agreement
and no Grantor shall be entitled to the return of the Collateral or any
portion
thereof subject thereto, notwithstanding the fact that after the Collateral
Agent shall have entered into such an agreement all Events of Default shall
have
been remedied and the Obligations paid in full. As an alternative to exercising
the power of sale herein conferred upon it, the Collateral Agent may proceed
by
a suit or suits at law or in equity to foreclose this Agreement and to
sell the
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. Any sale pursuant to the provisions of this Section
5.01 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.
Section
5.02. Application
of Proceeds.
The
Collateral Agent shall apply the proceeds of any collection or sale of
Collateral, as well as any Collateral consisting of cash, that it has obtained
as follows:
FIRST,
to
the payment of all costs and expenses incurred by the Administrative Agent
and
the Collateral Agent in connection with such collection or sale or otherwise
in
connection with this Agreement, any other Loan Document or any of the
Obligations, including all court costs and the fees and expenses of its
agents
and legal counsel, the repayment of all advances made by the Administrative
Agent or the Collateral Agent hereunder or under any other Loan Document
on
behalf of any Grantor and any other costs or expenses incurred in connection
with the exercise of any right or remedy hereunder or under any other Loan
Document;
25
SECOND,
to the Collateral Agent for distribution to the Secured Parties as provided
in
Section 2.16(b)(ii) of the Credit Agreement for the payment in full of
the
Obligations owed to the Secured Parties.
THIRD,
to
the Grantors, their successors or assigns, or as a court of competent
jurisdiction may otherwise direct.
The
Collateral Agent shall have absolute discretion as to the time of application
of
any such proceeds, moneys or balances in accordance with this Agreement.
Upon
any sale of Collateral by the Collateral Agent (including pursuant to a
power of
sale granted by statute or under a judicial proceeding), the receipt of
the
purchase money by the Collateral Agent or of the officer making the sale
shall
be a sufficient discharge to the purchaser or purchasers of the Collateral
so
sold and such purchaser or purchasers shall not be obligated to see to
the
application of any part of the purchase money paid over to the Collateral
Agent
or such officer or be answerable in any way for the misapplication
thereof.
Section
5.03. Grant
of License to Use Intellectual Property.
For the
purpose of enabling the Collateral Agent to exercise rights and remedies
under
this Agreement at such time as the Collateral Agent shall be lawfully entitled
to exercise such rights and remedies, each Grantor hereby grants to the
Collateral Agent an irrevocable, nonexclusive license (exercisable without
payment of royalty or other compensation to the Grantors) to use, license
or
sublicense any of the Article 9 Collateral consisting of Intellectual Property
now owned or hereafter acquired by such Grantor, wherever the same may
be
located, and 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
software
and programs used for the compilation or printout thereof. The use of such
license by the Collateral Agent may be exercised, at the option of the
Collateral Agent and, upon the occurrence and during the continuation of
an
Event of Default; provided
that any
license, sublicense or other transaction entered into by the Collateral
Agent in
accordance herewith shall be binding upon the Grantors notwithstanding
any
subsequent cure of an Event of Default.
Section
5.04. Securities
Act, etc.
In view
of the position of the Grantors in relation to the Pledged Collateral,
or
because of other current or future circumstances, a question may arise
under the
Securities Act of 1933, as now or hereafter in effect, or any similar statute
hereafter enacted analogous in purpose or effect (such Act and any such
similar
statute as from time to time in effect being called the “Federal
Securities Laws”)
with
respect to any disposition of the Pledged Collateral permitted hereunder.
Each
Grantor understands that compliance with the Federal Securities Laws might
very
strictly limit the course of conduct of the Collateral Agent if the Collateral
Agent were to attempt to dispose of all or any part of the Pledged Collateral,
and might also limit the extent to which or the manner in which any subsequent
transferee of any Pledged Collateral could dispose of the same. Similarly,
there
may be other legal restrictions or limitations affecting the Collateral
Agent in
any attempt to dispose of all or part of the Pledged Collateral under applicable
Blue Sky or other state securities laws or similar laws analogous in purpose
or
effect. Each Grantor recognizes that in light of such restrictions and
limitations the Collateral Agent may, with respect to any sale of the Pledged
Collateral, limit the purchasers to those who will agree, among other things,
to
acquire such Pledged Collateral for their own account, for investment,
and not
with a view to the distribution or resale thereof. Each Grantor acknowledges
and
agrees that in light of such restrictions and limitations, the Collateral
Agent,
in its sole and absolute discretion, (a) 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 been filed under the Federal Securities
Laws and (b) may approach and negotiate with a single potential purchaser
to
effect such sale. Each Grantor 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
Collateral Agent shall incur no responsibility or liability for selling
all or
any part of the Pledged Collateral at a price that the Collateral 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
as
aforesaid or if more than a single purchaser were approached. The provisions
of
this Section 5.04 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 Collateral Agent sells.
26
ARTICLE
VI
Indemnity,
Subrogation and Subordination
Section
6.01. Indemnity
and Subrogation.
In
addition to all such rights of indemnity and subrogation as the Guarantors
may
have under applicable law (but subject to Section 6.03), the Borrowers
agree
that (a) in the event a payment shall be made by any Guarantor under this
Agreement in respect of any Obligation, the Borrowers shall, jointly and
severally, indemnify such Guarantor for the full amount of such payment
and such
Guarantor shall be subrogated to the rights of the Person to whom such
payment
shall have been made to the extent of such payment and (b) in the event
any
assets of any Guarantor shall be sold pursuant to this Agreement or any
other
Security Document to satisfy in whole or in part an Obligation, the Borrowers
shall, jointly and severally, indemnify such Guarantor in an amount equal
to the
greater of the book value or the fair market value (as reasonably determined
by
the Borrowers) of the assets so sold.
Section
6.02. Contribution
and Subrogation.
Each
Guarantor (a “Contributing
Guarantor”)
agrees
(subject to Section 6.03) that, in the event a payment shall be made by
any
other Guarantor hereunder in respect of any Obligation or assets of any
other
Guarantor shall be sold pursuant to any Security Document to satisfy any
Obligation owed to any Secured Party and such other Guarantor (the “Claiming
Guarantor”)
shall
not have been fully indemnified by the Borrowers as provided in Section
6.01,
the Contributing Guarantor shall indemnify the Claiming Guarantor in an
amount
equal to the amount of such payment or the greater of the book value or
the fair
market value of such assets, as the case may be, in each case multiplied
by a
fraction of which the numerator shall be the net worth of the Contributing
Guarantor on the date hereof and the denominator shall be the aggregate
net
worth of all the Guarantors on the date hereof (or, in the case of any
Guarantor
becoming a party hereto pursuant to Section 7.16, the date of the supplement
hereto executed and delivered by such Guarantor). Any Contributing Guarantor
making any payment to a Claiming Guarantor pursuant to this Section 6.02
shall
be subrogated to the rights of such Claiming Guarantor under Section 6.01
to the
extent of such payment.
Section
6.03. Subordination.
(a) Notwithstanding
any provision of this Agreement to the contrary, all rights of the Guarantors
under Sections 6.01 and 6.02 and all other rights of indemnity, contribution
or
subrogation under applicable law or otherwise shall be fully subordinated
to the
indefeasible payment in full in cash of the Obligations. No failure on
the part
of any Borrower or any Guarantor to make the payments required by Sections
6.01
and 6.02 (or any other payments required under applicable law or otherwise)
shall in any respect limit the obligations and liabilities of any Guarantor
with
respect to its obligations hereunder, and each Guarantor shall remain liable
for
the full amount of the obligations of such Guarantor hereunder.
27
(b) Each
Guarantor hereby agrees that all Indebtedness and other monetary obligations
owed by it to any other Guarantor or any Subsidiary shall be fully subordinated
to the indefeasible payment in full in cash of the Obligations.
ARTICLE
VII
Miscellaneous
Section
7.01. Notices.
All
communications and notices hereunder shall (except as otherwise expressly
permitted herein) be in writing and given as provided in Section 9.01 of
the
Credit Agreement. All communications and notices hereunder to any Subsidiary
Loan Party shall be given to it in care of the Borrowers as provided in
Section
9.01 of the Credit Agreement.
Section
7.02. Security
Interest Absolute.
All
rights of the Collateral Agent hereunder, the Security Interest, the security
interest in the Pledged Collateral and all obligations of each Grantor
and
Guarantor hereunder shall be absolute and unconditional irrespective of
(a) any
lack of validity or enforceability of the Credit Agreement, any other Loan
Document, any agreement with respect to any of the Obligations or any other
agreement or instrument relating to any of the foregoing, (b) any change
in the
time, manner or place of payment of, or in any other term of, all or any
of the
Obligations, or any other amendment or waiver of or any consent to any
departure
from the Credit Agreement, any other Loan Document or any other agreement
or
instrument, (c) any exchange, release or non-perfection of any Lien on
other
collateral, or any release or amendment or waiver of or consent under or
departure from any guarantee, securing or guaranteeing all or any of the
Obligations, (d) any law or regulation of any jurisdiction or any other
event
affecting any term of a guaranteed obligation or (e) any other circumstance
that
might otherwise constitute a defense available to, or a discharge of, any
Grantor or Guarantor in respect of the Obligations or this
Agreement.
Section
7.03. Survival
of Agreement.
All
covenants, agreements, representations and warranties made by the Loan
Parties
in the Loan Documents and in the certificates or other instruments prepared
or
delivered in connection with or pursuant to this Agreement or any other
Loan
Document shall be considered to have been relied upon by the Lenders and
shall
survive the execution and delivery of the Loan Documents and the making
of any
Loans and the issuance of any Letters of Credit, regardless of any investigation
made by any Lender or on its behalf and notwithstanding that the Administrative
Agent, the Collateral Agent, the Issuing Bank or any Lender may have had
notice
or knowledge of any Default or incorrect representation or warranty at
the time
any credit is extended under the Credit Agreement, and shall continue in
full
force and effect as long as the principal of or any accrued interest on
any Loan
or any fee or any other amount payable under any Loan Document is outstanding
and unpaid or any Letter of Credit is outstanding and so long as the Commitments
have not expired or terminated.
Section
7.04. Binding
Effect; Several Agreement.
This
Agreement shall become effective as to any Loan Party when a counterpart
hereof
executed on behalf of such Loan Party shall have been delivered to the
Administrative Agent and a counterpart hereof shall have been executed
on behalf
of the Collateral Agent, and thereafter shall be binding upon such Loan
Party
and the Collateral Agent and their respective permitted successors and
assigns,
and shall inure to the benefit of such Loan Party, the Collateral Agent
and the
other Secured Parties and their respective permitted successors and assigns,
except that no Loan Party shall have the right to assign or transfer its
rights
or obligations hereunder or any interest herein or in the Collateral (and
any
such assignment or transfer shall be void) except as expressly contemplated
by
this Agreement or the Credit Agreement. This Agreement shall be construed
as a
separate agreement with respect to each Loan Party and may be amended,
modified,
supplemented, waived or released with respect to any Loan Party without
the
approval of any other Loan Party and without affecting the obligations
of any
other Loan Party hereunder.
28
Section
7.05. Successors
and Assigns.
Whenever in this Agreement any of the parties hereto is referred to, such
reference shall be deemed to include the permitted successors and assigns
of
such party; and all covenants, promises and agreements by or on behalf
of any
Grantor or the Collateral Agent that are contained in this Agreement shall
bind
and inure to the benefit of their respective permitted successors and
assigns.
Section
7.06. Collateral
Agent’s Fees and Expenses; Indemnification.
(a) The
parties hereto agree that the Collateral Agent shall be entitled to
reimbursement of its expenses incurred hereunder as provided in Section
9.03 of
the Credit Agreement.
(b) Without
limitation of its indemnification obligations under the other Loan Documents,
each Grantor jointly and severally agrees to indemnify the Collateral Agent
and
the other Indemnitees (as defined in Section 9.03 of the Credit Agreement)
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the reasonable fees,
charges and disbursements of any counsel for any Indemnitee, incurred by
or
asserted against any Indemnitee arising out of, in connection with, or
as a
result of, the execution, delivery or performance of this Agreement or
any
claim, litigation, investigation or proceeding relating hereto, or to the
Collateral, whether or not any Indemnitee is a party thereto; provided
that
such indemnity shall not, as to any Indemnitee, be available to the extent
that
such losses, claims, damages, liabilities or related expenses are determined
by
a court of competent jurisdiction by final and nonappealable judgment to
have
resulted from the gross negligence or wilful misconduct of such
Indemnitee.
(c) Any
such
amounts payable as provided hereunder shall be additional Obligations secured
hereby and by the other Security Documents. The provisions of this Section
7.06
shall remain operative and in full force and effect regardless of the
termination of this Agreement or any other Loan Document, the consummation
of
the transactions contemplated hereby, the repayment of any of the Obligations,
the invalidity or unenforceability of any term or provision of this Agreement
or
any other Loan Document, or any investigation made by or on behalf of the
Collateral Agent or any other Secured Party. All amounts due under this
Section
7.06 shall be payable on written demand therefor.
Section
7.07. Collateral
Agent Appointed Attorney-in-Fact.
Each
Grantor hereby appoints the Collateral Agent the attorney-in-fact of such
Grantor for the purpose of carrying out the provisions of this Agreement
and
taking any action and executing any instrument that the Collateral Agent
may
deem necessary or advisable to accomplish the purposes hereof, which appointment
is irrevocable and coupled with an interest. Without limiting the generality
of
the foregoing, the Collateral Agent shall have the right, upon the occurrence
and during the continuance of an Event of Default, with full power of
substitution either in the Collateral Agent’s name or in the name of such
Grantor: (a) to receive, endorse, assign and/or deliver any and all notes,
acceptances, checks, drafts, money orders or other evidences of payment
relating
to the Collateral or any part thereof; (b) to demand, collect, receive
payment
of, give receipt for and give discharges and releases of all or any of
the
Collateral; (c) to ask for, demand, xxx for, collect, receive and give
acquittance for any and all moneys due or to become due under and by virtue
of
any Collateral; (d) to sign the name of any Grantor on any invoice or xxxx
of
lading relating to any of the Collateral; (e) to send verifications of
Accounts
to any Account Debtor; (f) to commence and prosecute any and all suits,
actions
or proceedings at law or in equity in any court of competent jurisdiction
to
collect or otherwise realize on all or any of the Collateral or to enforce
any
rights in respect of any Collateral; (g) to settle, compromise, compound,
adjust
or defend any actions, suits or proceedings relating to all or any of the
Collateral; (h) to notify, or to require any Grantor to notify, Account
Debtors
to make payment directly to the Collateral Agent; and (i) to use, sell,
assign,
transfer, pledge, make any agreement with respect to or otherwise deal
with all
or any of the Collateral, and to do all other acts and things necessary
to carry
out the purposes of this Agreement, as fully and completely as though the
Collateral Agent were the absolute owner of the Collateral for all purposes;
provided,
that
nothing herein contained shall be construed as requiring or obligating
the
Collateral Agent to make any commitment or to make any inquiry as to the
nature
or sufficiency of any payment received by the Collateral Agent, or to present
or
file any claim or notice, or to take any action with respect to the Collateral
or any part thereof or the moneys due or to become due in respect thereof
or any
property covered thereby. The Collateral Agent and the other Secured Parties
shall be accountable only for amounts actually received as a result of
the
exercise of the powers granted to them herein, and neither they nor 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
wilful misconduct.
29
Section
7.08. GOVERNING
LAW.
THIS
AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE
OF
NEW YORK, WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF RELATING TO CONFLICTS
OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION
WOULD BE REQUIRED THEREBY.
Section
7.09. Waivers;
Amendment.
(a) No
failure or delay by the Administrative Agent, the Collateral Agent, the
Issuing
Bank or any Lender in exercising any right, power or remedy hereunder or
under
any other Loan Document shall operate as a waiver thereof, nor shall any
single
or partial exercise of any such right, power or remedy, or any abandonment
or
discontinuance of steps to enforce such a right, power or remedy, preclude
any
other or further exercise thereof or the exercise of any other right, power
or
remedy. The rights, powers and remedies of the Administrative Agent, the
Collateral Agent, the Issuing Bank and the Lenders hereunder and under
the other
Loan Documents are cumulative and are not exclusive of any rights, powers
or
remedies that they would otherwise have. No waiver of any provision of
this
Agreement or consent to any departure by any Loan Party therefrom shall
in any
event be effective unless the same shall be permitted by paragraph (b)
of this
Section 7.09, and then such waiver or consent shall be effective only in
the
specific instance and for the purpose for which given. Without limiting
the
generality of the foregoing, the making of a Loan or the issuance of a
Letter of
Credit shall not be construed as a waiver of any Default, regardless of
whether
the Administrative Agent, the Collateral Agent, any Lender or the Issuing
Bank
may have had notice or knowledge of such Default at the time. No notice
or
demand on any Loan Party in any case shall entitle any Loan Party to any
other
or further notice or demand in similar or other circumstances.
(b) Neither
this Agreement nor any provision hereof may be waived, amended or modified
except pursuant to an agreement or agreements in writing entered into by
the
Collateral Agent and the Loan Party or Loan Parties with respect to which
such
waiver, amendment or modification is to apply, subject to any consent required
in accordance with Section 9.02 of the Credit Agreement.
Section
7.10. 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, ANY OTHER LOAN
DOCUMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT
OR ANY
OTHER THEORY). EACH PARTY HERETO (A) 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 (B) 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 7.10.
30
Section
7.11. Severability.
Any
provision of this Agreement held to be invalid, illegal or unenforceable
in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of
such invalidity, illegality or unenforceability without affecting the validity,
legality and enforceability in such jurisdiction of the remaining provisions
hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.
The
parties hereto 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
7.12. Counterparts.
This
Agreement may be executed in counterparts (and by different parties hereto
on
different counterparts), each of which shall constitute an original but
all of
which, when taken together, shall constitute a single contract, and shall
become
effective as provided in Section 7.04. Delivery of an executed signature
page to
this Agreement by facsimile transmission shall be as effective as delivery
of a
manually signed counterpart of this Agreement.
Section
7.13. Headings.
Article
and Section headings used herein are for the purpose of reference only,
are not
part of this Agreement and are not to affect the construction of, or to
be taken
into consideration in interpreting, this Agreement.
Section
7.14. Jurisdiction;
Consent to Service of Process.
(a) Each
of
the Loan Parties hereby irrevocably and unconditionally submits, for itself
and
its property, to the nonexclusive jurisdiction of the Supreme Court of
the State
of New York sitting in New York County and of the United States District
Court
of the Southern District of New York, and any appellate court from any
thereof,
in any action or proceeding arising out of or relating to this Agreement
or any
other Loan Document, 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, 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 or any other Loan Document shall affect any right that the
Administrative Agent, the Collateral Agent, the Issuing Bank or any Lender
may
otherwise have to bring any action or proceeding relating to this Agreement
or
any other Loan Document against any Grantor or Guarantor, or its properties,
in
the courts of any jurisdiction.
(b) Each
of
the Loan Parties hereby irrevocably and unconditionally waives, to the
fullest
extent permitted by law, any objection that 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 or any other Loan Document in any court referred to in paragraph
(a) of this Section 7.14. 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.
(c) Each
party to this Agreement irrevocably consents to service of process in the
manner
provided for notices in Section 7.01. Nothing in this Agreement or any
other
Loan Document will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
31
Section
7.15. Termination
or Release.
(a) This
Agreement, the guarantees made herein, the Security Interest and all other
security interests granted hereby shall terminate when all the Loan Document
Obligations have been indefeasibly paid in full and the Lenders have no
further
commitment to lend under the Credit Agreement, the LC Facility LC Obligations
and the Revolving LC Obligations have been reduced to zero and the LC Facility
Issuing Bank and the Revolving Issuing Bank have no further obligations
to issue
Letters of Credit under the Credit Agreement.
(b) A
Subsidiary Loan Party shall automatically be released from its obligations
hereunder and the security interests in the Collateral of such Subsidiary
Loan
Party shall be automatically released upon the consummation of any transaction
permitted by the Credit Agreement as a result of which such Subsidiary
Loan
Party ceases to be a Subsidiary of the Parent; provided
that the
Required Lenders 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 Grantor of any Collateral that is permitted
under
the Credit Agreement to any Person that is not a Grantor, or upon the
effectiveness of any written consent to the release of the security interest
granted hereby in any Collateral pursuant to Section 9.02 of the Credit
Agreement, the security interest in such Collateral shall be automatically
released; provided
that the
Proceeds resulting from such sale or other transfer shall be included in
the
Collateral.
(d) In
connection with any termination or release pursuant to paragraph (a), (b)
or (c)
of this Section 7.15, the Collateral Agent shall execute and deliver to
any
Grantor at such Grantor’s expense all documents that such Grantor shall
reasonably request to evidence such termination or release. Any execution
and
delivery of documents pursuant to this Section 7.15 shall be without recourse
to
or warranty by the Collateral Agent.
Section
7.16. Additional
Subsidiaries.
Pursuant to Section 5.11 of the Credit Agreement, each Subsidiary of a
Loan
Party that was not in existence or not a Subsidiary on the date of the
Credit
Agreement and is not a Foreign Subsidiary is required to enter into this
Agreement as a Subsidiary Loan Party upon becoming such a Subsidiary. Upon
execution and delivery by the Collateral Agent and a Subsidiary of an instrument
in the form of Exhibit I hereto, such Subsidiary shall become a Subsidiary
Loan
Party hereunder with the same force and effect as if originally named as
a
Subsidiary Loan Party herein. The execution and delivery of any such instrument
shall not require the consent of any other Loan Party hereunder. The rights
and
obligations of each Loan Party hereunder shall remain in full force and
effect
notwithstanding the addition of any new Loan Party as a party to this
Agreement.
Section
7.17. Right
of Setoff.
Subject
to Section 9.08 of the Credit Agreement, if an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted
by
law, to set off and apply any and all deposits (general or special, time
or
demand, provisional or final) at any time held and other obligations at
any time
owing by such Lender or Affiliate to or for the credit or the account of
any
Subsidiary Loan Party against any of and all the obligations of such Subsidiary
Loan Party now or hereafter existing under this Agreement owed to such
Lender,
irrespective of whether or not such Lender shall have made any demand under
this
Agreement and although such obligations may be unmatured.
Section
7.18. Effect
on Existing Guarantee and Collateral Agreement.
Upon
the
execution and delivery by the parties hereto of this Agreement and the
satisfaction of the conditions set forth in Sections 4.01 and 4.02 of the
Credit
Agreement, (i) this Agreement shall, except to the extent explicitly provided
herein, be deemed to amend, restate and supersede the Existing Guarantee
and
Collateral Agreement; provided
that the
obligations of the Loan Parties (party hereto) under the Existing Guarantee
and Collateral Agreement
and the
grant of security interest in the Collateral by the relevant Loan Parties
under
the Existing Guarantee
and Collateral Agreement
shall
continue under this Agreement, and shall not in any event be terminated,
extinguished or annulled, but shall hereafter be governed by this Agreement
and
(ii)
all
Obligations under the Existing Guarantee and Collateral Agreement shall
continue
to be outstanding except as expressly modified by this Agreement and shall
be
governed in all respects by this Agreement, it being agreed and understood
that
this Agreement does not constitute a novation or satisfaction of any Obligation
under the Existing Guarantee and Collateral Agreement except as expressly
modified by this Agreement, nor does it operate as a waiver of any right,
power
or remedy of any Lender under any “Loan Documents” (as
defined in the Existing Credit Agreement).
32
IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the
day and year first above written.
DENNY’S,
INC.
By:
/s/
Xxxx Xxxxx
Name:
Xxxx
Xxxxx
Title: Vice
President and Treasurer
XXXXX’X
REALTY,
LLC
By: DFO,
LLC
Its: Sole
Member
By: Denny’s
Inc.
Its: Sole
Member
By:
/s/
Xxxx Xxxxx
Name:
Xxxx
Xxxxx
Title: Vice
President and Treasurer
XXXXX’X
CORPORATION
By:
/s/
Xxxx Xxxxx
Name:
Xxxx
Xxxxx
Title: Vice
President and Treasurer
XXXXX’X
HOLDINGS,
INC.
By:
/s/
Xxxxxxxx Xxxxxxx
Name:
Xxxxxxxx
Xxxxxxx
Title: Vice
President and Secretary
DFO,
LLC
By: Denny’s
Inc.
Its: Sole
Member
By:
/s/
Xxxx Xxxxx
Name:
Xxxx
Xxxxx
Title: Vice
President and Treasurer
BANK
OF AMERICA,
N.A.,
as
Collateral
Agent
By:
/s/
Xxxxxxx X. Xxxxx
Name: Xxxxxxx
X. Xxxxx
Title: Vice
President
