Exhibit 2.8
EXECUTION COPY
GUARANTY AND SECURITY AGREEMENT
GUARANTY AND SECURITY AGREEMENT (this "AGREEMENT"), dated as of April
27th, 2005 by and between MITEL NETWORKS, INC., a Delaware corporation, having
its principal office at Suite 400, 000 Xxx Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx,
Xxxxxx Xxxxxx 00000-0000 (the "GUARANTOR") and HIGHBRIDGE INTERNATIONAL LLC, a
limited liability company formed under the laws of the Cayman Islands having an
office at c/o Highbridge Capital Management, LLC, 9 West 57th Street, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx, X.X.X. 00000, as collateral agent (in such capacity,
the "COLLATERAL AGENT") for itself as a holder and the other holders (each a
"SECURED PARTY" and collectively, the "SECURED PARTIES"), from time to time of
senior secured convertible notes initially issued as of the date hereof, (as
amended, restated or supplemented from time to time the "NOTES"), issued by
Mitel Networks Corporation, a corporation incorporated under the laws of Canada
(the "ISSUER") pursuant to a Securities Purchase Agreement dated the date hereof
(the "SECURITIES PURCHASE AGREEMENT") by and among the Issuer and the buyers
party thereto.
WITNESETH
WHEREAS, the Guarantor is an indirect wholly-owned subsidiary of the
Issuer; and
WHEREAS, the Guarantor will benefit from the arrangements under the
issuance of the Notes and the receipt of proceeds therefrom by the Issuer.
NOW THEREFORE, in consideration of the covenants contained herein, and
other good and valuable consideration the receipt of which is acknowledged by
each party hereto, the Guarantor and the Collateral Agent hereby agree as
follows:
1. GUARANTY
For value received, and in order to induce the Secured Parties to
purchase the Notes, the Guarantor unconditionally and irrevocably guaranties to
the Collateral Agent and the other Secured Parties and their respective
successors and assigns the complete and punctual payment when due (whether at
the stated maturity or earlier by acceleration or otherwise) of all
indebtedness, liabilities and obligations (whether direct, indirect, absolute,
contingent or otherwise) of the Issuer to the Collateral Agent or any other
Secured Party existing, from time to time, and arising pursuant to the Notes,
the Securities Purchase Agreement, the Security Documents and the Registration
Rights Agreement (each as defined in the Securities Purchase Agreement), or the
Collateral Agency Agreement among, among others, Mitel Networks Corporation and
the buyers party thereto dated the date hereof (the "Collateral Agency
Agreement") (the "LIABILITIES"), whether characterized as principal, premium,
interest, additional interest, special interest, fees, expenses or otherwise.
2. CERTAIN RIGHTS OF SECURED PARTY
At any time and from time to time (and whether once or more than
once), without the necessity of any reservation of rights against the Guarantor
and without notice to, demand on or further assent by the Guarantor or any other
person: (a) any of the Liabilities or the obligations
Portions of this document marked with "***" are subject to a pending
Confidential Treatment Request filed with the Secretary of the Securities and
Exchange Commission and have been filed separately with the Securities and
Exchange Commission.
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of any other guarantor of the Liabilities may be changed, renewed, extended,
continued, accelerated, surrendered, compromised, subordinated, waived or
released, in whole or in part, or any default with respect thereto waived or any
demand for payment with respect thereto rescinded; (b) the Collateral Agent and
the other Secured Parties may set off, refrain from setting off or release, in
whole or in part, may take or refrain from taking or perfecting any security
interest in any collateral security and may exercise or refrain from exercising
any right against the Issuer or any other person; (c) the Collateral Agent and
the other Secured Parties may extend or refrain from extending further credit or
financial accommodations in any manner whatsoever to, may accept compositions
from and may otherwise generally deal with the Issuer and any other person and
with any collateral security as the Collateral Agent or the applicable Secured
Party may see fit; and (d) the Collateral Agent may apply all moneys at any time
received from the Issuer or any other person or from any collateral security in
such manner) in such amounts and against such part of the Liabilities as the
Collateral Agent considers best and change any such application in whole or in
part as the Collateral Agent may see fit. All of these actions may be taken
without in any way limiting, diminishing or affecting the Guarantor's liability
under this Agreement and without imposing any obligation of trust on the
Collateral Agent or any Secured Party, and no loss of or in respect of any
collateral security, whether caused by the fault of the Collateral Agent, any
Secured Party or otherwise, shall in any way limit, diminish or affect the
Guarantor's liability under this Agreement.
3. LIABILITY OF GUARANTOR UNCONDITIONAL
This Agreement is a guaranty of payment and not merely of collection.
The Guarantor's liability under this Agreement and the grant of the security
interest in the Collateral (as defined in Section 11 hereof) are absolute and
unconditional and shall not be limited, diminished or affected by the happening
from time to time of any event, including (but not limited to) any event
described in Section 2 of this Agreement or any of the following events, whether
or not any such event occurs with notice to or with the consent of the Guarantor
or once or more than once:
(a) the waiver, surrender, compromise, settlement, discharge, release or
termination of any or all of the Liabilities;
(b) the failure to give any notice to the Issuer;
(c) the extension of the time for payment or performance of any of the
Liabilities;
(d) the change (whether or not material) of the terms of the Notes, the
Securities Purchase Agreement, the Security Documents, the
Registration Rights Agreement (as defined in the Securities Purchase
Agreement), the Collateral Agency Agreement or any other document or
instrument relating to the Liabilities (a "CREDIT DOCUMENT");
(e) the taking of or failure to take any action referred to in any Credit
Document;
(f) the illegality, invalidity, unenforceability (including, but not
limited to, by reason of any statute of limitations or automatic stay)
or irregularity of any of the Liabilities or any Credit Document;
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(g) any failure, omission, delay or lack of diligence on the part of the
Collateral Agent or any other Secured Party in the enforcement,
assertion or exercise of any right, power or remedy conferred on the
Collateral Agent or any other Secured Party under any Credit Document,
or the inability of the Collateral Agent or any other Secured Party to
enforce any provision of any Credit Document for any reason, including
(but not limited to) failure by the Collateral Agent or any other
Secured Party to perfect or protect any lien or security interest
granted to the Collateral Agent or any other Secured Party, to
commence and prosecute any action to collect the Liabilities or to
enforce or collect any judgment obtained by the Collateral Agent or
any other Secured Party or any other act or omission on the part of
the Collateral Agent or any other Secured Party;
(h) the dissolution or liquidation of the Issuer, the sale or other
disposition of all or substantially all of the assets of the Issuer,
the marshalling of assets and liabilities of the Issuer or the
existence of receivership, insolvency, assignment for the benefit of
creditors, bankruptcy, reorganization, arrangement, adjustment,
composition or other similar proceedings affecting the Issuer; and
(i) any other event, action or circumstance that could otherwise result in
the release or discharge of the Guarantor from the performance or
observance of any obligation, covenant or agreement contained in this
Agreement.
4. WAIVER OF NOTICE
The Guarantor waives all notices of the creation, renewal, extension
or accrual of any of the Liabilities and notice or proof of reliance by the
Collateral Agent or any other Secured Party on this Agreement or acceptance of
this Agreement. The Liabilities shall conclusively be considered to have been
created, contracted, and incurred in reliance on this Agreement, and all
dealings between the Issuer and the Collateral Agent and/or the other Secured
Parties shall likewise be conclusively presumed to have been had or consummated
in reliance on this Agreement. Except as otherwise provided herein and in the
Credit Documents, the Guarantor also waives (to the extent permitted by
applicable law) all requirements of notice, presentment, protest or demand on
it, the Issuer or any other person, all other notices and demands whatsoever
relating to the Liabilities and any requirement that the Collateral Agent or any
other Secured Party file a claim with a court in any bankruptcy, insolvency or
similar proceedings of the Issuer or first proceed against the Issuer or any
other person or first realize on any collateral security held by it or otherwise
exhaust any right, power or remedy under any Credit Document or against the
Issuer or any other person before proceeding against the Guarantor under this
Agreement. Neither the Collateral Agent nor any other Secured Party shall have
any responsibility to notify the Guarantor of the Issuer's financial condition
or the Issuer's incurrence or performance of the Liabilities.
5. CONTINUING AGREEMENT
This Agreement is a continuing agreement, and shall not terminate or
be discharged until the earlier of (a) performance and indefeasible payment in
full of all of the Liabilities and (b) the date on which a Qualified IPO (as
defined in the Notes) is consummated. If demand for, or acceleration of the time
for, payment by the Issuer to the Collateral Agent or
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any other Secured Party of any of the Liabilities is stayed upon the insolvency,
bankruptcy, reorganization or proposed compromise or arrangement with creditors
of the Issuer, all Liabilities of which payment or performance is stayed that
would otherwise be subject to the demand for payment or acceleration shall
nonetheless be payable by the Guarantor immediately on demand by the Collateral
Agent or the applicable Secured Parties. Upon termination of this Agreement, in
accordance with the first sentence of this Section 5, the Collateral Agent shall
reassign and deliver to the Guarantor, or to such person or persons as the
Guarantor shall designate, against receipt, such of the Collateral (if any) as
shall not have been sold or otherwise applied by the Collateral Agent pursuant
to the terms hereof and shall still be held by it hereunder, together with
appropriate instruments of reassignment and release. Any such reassignment shall
be without recourse to or warranty by the Collateral Agent and at the expense of
the Guarantor. Upon such termination, the Guarantor or its agents are authorized
to file all appropriate termination statements.
6. REINSTATEMENT
This Agreement shall continue to be effective, or shall be reinstated,
if at any time payment, or any part thereof of any of the Liabilities is
rescinded or must otherwise be returned by the Collateral Agent or any other
Secured Party for any reason whatsoever (including, but not limited to, the
bankruptcy, insolvency, dissolution, liquidation or reorganization of the Issuer
or any other person), all as though such payment had not been received by the
Collateral Agent or any other Secured Party.
7. SUBORDINATION
All indebtedness, obligations, liabilities and other amounts due, of
whatever nature, of the Issuer to the Guarantor (the "SUBORDINATED DEBT"),
whether now existing or hereafter incurred, whether created directly or acquired
by the Guarantor by assignment or otherwise, whether matured or unmatured,
whether absolute or contingent, whether characterized as principal, premium,
interest, additional interest, special interest, fees, expenses or otherwise and
whether the Issuer is bound alone or with any others or as principal or as
surety, shall be subject and subordinate to the Liabilities, and, upon the
occurrence of an Event of Default, all moneys received by the Guarantor in
respect of the Subordinated Debt shall immediately on the Collateral Agent's
demand be paid over to the Collateral Agent. This subordination is independent
of the guaranty provided in this Agreement and shall remain in full force and
effect notwithstanding any decrease in the Guarantor's liability under this
Agreement. The Guarantor hereby undertakes to execute such additional documents
and instruments and to do such additional acts as may be necessary or desirable
(in the sole discretion of the Collateral Agent, reasonably exercised) in order
to carry out, complete or perfect this subordination.
8. LIMIT ON SUBROGATION
Until termination of this Agreement in accordance with the first
sentence of Section 5 hereof, no payment by the Guarantor pursuant to any
provision of this Agreement or other satisfaction of the Guarantor's liability
under this Agreement shall entitle the Guarantor, by subrogation or otherwise,
to any right or remedy against the Issuer and the Guarantor waives any such
right it may have.
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9. COSTS, EXPENSES, ETC.
The Guarantor agrees to pay on demand all losses, costs, expenses
(including, but not limited to, reasonable attorneys' fees) and damages incurred
by the Collateral Agent or any other Secured Party in connection with any
amendment, waiver or consent with respect to this Agreement, in connection with
any rescission, reinstatement or return referred to in Section 6 of this
Agreement, in enforcing or attempting to enforce this Agreement or any other
guaranty of the Liabilities or in protecting the Collateral Agent's or any other
Secured Party's rights under this Agreement or any other guaranty of the
Liabilities following any default by the Guarantor under this Agreement, whether
the Collateral Agent's or any other Secured Party's rights are enforced by suit
or otherwise.
10. LIABILITIES ADDITIONAL
This Agreement and the Guarantor's liability under this Agreement are
in addition to and not in substitution for (a) any other collateral security, by
whomsoever given, at any time held by the Collateral Agent or any other Secured
Party and (b) any present or future obligation of the Guarantor or any other
obligor to the Collateral Agent or any other Secured Party incurred otherwise
than under this Agreement, whether the Guarantor or such, other obligor is bound
with or apart from the Issuer.
11. SECURITY INTEREST
(a) As security from the Guarantor for the payment and performance in full
of the Liabilities, the Guarantor hereby transfers, grants, bargains,
conveys, hypothecates, pledges, sets over, delivers and confers unto
the Collateral Agent for the benefit of the Secured Parties, and
grants to the Collateral Agent for the benefit of the Secured Parties
a security interest in its right, title and interest in the following
(the "COLLATERAL"), whether now owned or hereinafter acquired:
(i) Accounts (including Health-Care-Insurance Receivables, if any)
howsoever arising in connection with sale or lease of goods or
services by the Guarantor to customers or any other Person (as
defined in the Securities Purchase Agreement);
(ii) Chattel Paper;
(iii) Instruments (including Promissory Notes);
(iv) Documents;
(v) General Intangibles (including, without limitation, Payment
Intangibles, Software, contract rights, credits, claims, demands,
debts, choses in action, trade-marks, patents, and all other
intellectual property including, copyrights, and including in
each case any documentation pertaining thereto);
(vi) Letter-of-Credit Rights;
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(vii) Supporting Obligations;
(viii) Deposit Accounts;
(ix) Investment Property (including without limitation certificated
and uncertificated Securities), Securities Accounts, Security
Entitlements, Commodity Accounts, and Commodity Contracts);
(x) Inventory;
(xi) Equipment (including all software, whether or not the same
constitutes embedded software, used in the operation thereof);
(xii) Money, including, without limitation, amounts deposited into
escrow or with, third parties;
(xiii) Fixtures;
(xiv) All rights to merchandise and other goods (including rights to
returned or repossessed Goods and rights of stoppage in transit)
which is represented by, arises from, or relates to any of the
foregoing;
(xv) All supporting evidence and documents relating to any of the
above-described property, including, without limitation, computer
programs, disks, tapes and related electronic data processing
media and all rights of the Guarantor to retrieve the same from
third parties, written applications, credit information, account
cards, payment records, correspondence, delivery and installation
certificates, invoice copies, delivery receipts, notes, and other
evidences of indebtedness, insurance certificates and the like,
together with all books of account, ledgers, and cabinets in
which the same are reflected or maintained;
(xvi) All Accessions and additions to, and substitutions and
replacements of, any and all of the foregoing; and
(xvii) All Proceeds and products of the foregoing, and all insurance
of the foregoing and proceeds thereof;
all of the foregoing being herein sometimes referred to as the
"COLLATERAL". All terms capitalized in this Section 1l(a) that are
defined in the Uniform Commercial Code as in effect from time to time
in the State of New York (as the same may be amended from time to
time, the "UCC") shall have the same meanings herein as such terms are
defined in the UCC. Where the context permits, any reference to
"COLLATERAL" shall be deemed to be a reference to "Collateral or any
part thereof."
(b) Notwithstanding anything herein to the contrary, in no event shall the
security interest granted under Section 11(a) attach to any lease,
license, Governmental Authorization, instrument, document, contract,
property rights or agreement to which the Guarantor is a party, or any
of its rights or interests thereunder
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(collectively, the "CONTRACTUAL RIGHTS"), if and for so long as the
grant of such security interest shall constitute or result in: (i) the
abandonment, invalidation or unenforceability of any right, title or
interest of the Guarantor therein or (ii) a breach or termination
pursuant to the terms of, or a default under, any such Contractual
Right (other than to the extent that any such term would be rendered
ineffective pursuant to Section 9-406, 9-407, 9-408 or 9-409 of the
UCC (or any successor provision or provisions) of any relevant
jurisdiction or any other applicable law or principles or equity),
provided, however, that such security interest shall attach
immediately at such time as the condition causing such abandonment,
invalidation or unenforceability shall be remedied and, to the extent
severable, shall attach immediately to any portion of such Contractual
Right that does not result in any of the consequences specified in
clauses (i) or (ii) above, including any proceeds of such Contractual
Right, but the Guarantor shall hold its interest therein in trust for
the Collateral Agent, for the benefit of the Secured Parties, and
shall assign such Contractual Rights to the Collateral Agent, for the
benefit of the Secured Parties, forthwith upon obtaining the consent
of the other party thereto. The Guarantor agrees that it shall, upon
the request of the Collateral Agent, use all commercially reasonable
efforts to obtain any consent required to permit any Contractual
Rights to be subjected to the security interests granted herein. For
purposes of this Section 11(b), the term "GOVERNMENTAL AUTHORIZATION"
shall mean any permit, license, authorization, plan, directive,
consent order or consent decree of or form the government of the
United States of America or any other nation, or of any political
subdivision thereof, whether state or local, or any agency, authority,
instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government
(including, without limitation, any supra-national bodies such as the
European Union or the European Central Bank).
12. REPRESENTATIONS, WARRANTIES AND COVENANTS
The Guarantor represents, warrants and covenants to and with the
Collateral Agent and each of the other Secured Parties that:
(a) except for the security interest granted to the Collateral Agent, for
the benefit of the Secured Parties, hereunder and except for Permitted
Liens, the Guarantor (i) holds and will at all times continue to hold
the Collateral free and clear of any and all Liens (as defined in the
Notes), and (ii) without in any way diminishing the foregoing, will
neither cause, permit or suffer to exist any other Lien on the
Collateral;
(b) the Guarantor (i) has good right and legal authority to encumber the
Collateral as provided herein, guaranty the Liabilities and otherwise
enter into and perform its obligations hereunder, and (ii) will defend
its title or interest thereto or therein against any and all other
Liens (providing that nothing in this paragraph (b) shall be deemed to
authorize or permit any Liens, as further described in paragraph (a)
above;
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(c) no consent or approval of any third party, of any governmental body or
regulatory authority or of any securities exchange was, is or shall be
necessary to the validity of the Lien effected hereby (other than any
such consent or approval that shall have been obtained as required);
(d) the Lien created hereby constitutes a valid security interest in favor
of the Collateral Agent in the rights of the Guarantor in the
Collateral as set forth herein and upon the filing of a uniform
commercial code financing statement with the Secretary of the State of
Delaware will constitute a first priority perfected security interest,
subject to the acknowledgement and confirmation with Endurance Trust
dated the date hereof, to the extent that the filing of a financing
statement is effective to perfect such security interest;
(e) the execution, delivery and/or performance hereof by the Guarantor
will not (i) cause the Guarantor to be in violation of, or constitute
a material default under, the provisions of any agreement to which the
Guarantor is a party or by which the Guarantor or its assets are
bound, (ii) conflict with, or result in the breach of, any court
judgment, decree or order of any governmental body to which the
Guarantor or its assets are subject, (iii) result in the creation or
imposition of any Lien of any nature whatsoever upon any of the
property or assets of the Guarantor, except for Liens in favour of the
Collateral Agent and the Secured Parties pursuant to this Agreement,
except for such violations, conflicts, defaults, breaches and Liens
which would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect (as defined in the
Securities Purchase Agreement);
(f) all representations and warranties of the Guarantor contained in this
Agreement shall survive the Closing (as defined in the Securities
Purchase Agreement); and
(g) without the prior written consent of the Collateral Agent, the
Guarantor shall not
(i) maintain any of its books and records with respect to the
Collateral at any location other than either the office listed in
the first paragraph hereof or at its (or the Issuer's) offices in
Ottawa, Canada;
(ii) maintain its principal place of business (or if it has more than
one place of business, its chief executive office or domicile as
defined in the Civil Code of Quebec) at any place other than at
the address set forth in the first paragraph hereof unless it
shall have (A) notified the Collateral Agent in writing as least
thirty (30) days prior to any such change of such address and (B)
taken all actions necessary or advisable to maintain the
continuous validity, perfection and the same or better priority
of the Collateral Agent's security interest in the Collateral
granted or intended to be granted and agreed to hereby;
(iii) (A) acquire any assets outside of the United States (which, for
greater certainty, consists of the District of Columbia and the
50 states and does not include territories and possessions of the
United States), or (B) cause, suffer or permit the movement or
relocation of any Collateral currently
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located in the United States to a location outside of the United
States, other than bona fide sales of inventory, if any, in the
ordinary course of business; provided that (subject to the
provisions of the Notes) the Guarantor shall deposit the proceeds
of all of its sales into an account described in paragraph (v)
below;
(iv) maintain any Securities Accounts; or
(v) open, establish or maintain any deposit or other bank accounts,
other than
(A) the existing deposit account of the Guarantor at Bank One
with account number *** and the existing deposit account of
the Guarantor at Xxxxxx Bank with account number ***, and
(B) such other deposit accounts that are subject to a "control"
agreement in all material respects identical to those to be
entered into with respect to the deposit accounts identified
in clause (A) above;
provided that, with respect to the deposit accounts listed in (A)
and (B) above, if at any time after the date that is thirty (30)
days following the date of Closing (1) the Collateral Agent does
not have a first priority perfected security interest in, and
"control" (as defined in Section 9-104 of the UCC) of, such
account and the contents thereof, or (2) the applicable
depository institution gives notice that it is terminating its
"control agreement" with Collateral Agent, then the Guarantor
shall promptly close such account and deliver the contents
thereof to the Collateral Agent for holding in a cash collateral
account (or other form of collateral reasonably satisfactory to
the Collateral Agent); or
(vi) change its name, or the name under which it does business, or its
organizational structure (i.e., Delaware corporation) from the
name and form indicated in the first paragraph of this Agreement
unless it shall have (A) notified the Collateral Agent in writing
as least thirty (30) days prior to any such change and (B) taken
all actions necessary or advisable to maintain the continuous
validity, perfection and the same or better priority of the
Collateral Agent's security interest in the Collateral granted or
intended to be granted and agreed to hereby; and
(h) all of the accounts receivable included in the Collateral represent
proceeds of transactions conducted in the ordinary course of the
Guarantor's business for which the Guarantor received reasonable
consideration for the goods and services including, without
limitation, all payments from the Issuer to the Guarantor with respect
to goods and/or services provided to the Issuer by the Guarantor.
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13. PROCEEDS OF COLLATERAL; DELIVERY OF COLLATERAL
(a) The Guarantor shall, upon the request of the Collateral Agent made
after the occurrence of any Event of Default, instruct all account
debtors and other Persons obligated in respect of all applicable
Collateral (including without limitation Accounts, Instruments,
Investment Property, General Intangibles and Payment Intangibles) to
make all payments in respect thereof directly to the Collateral Agent
(by instructing that such payments be remitted to such address
specified by the Collateral Agent which shall be in the name and under
the control of the Collateral Agent). In addition to the foregoing,
the Guarantor agrees that if the proceeds of any Collateral hereunder
(including the payments made in respect of any of the foregoing
collateral types) shall be received by it after the occurrence of any
Event of Default, the Guarantor shall as promptly as possible deliver
such proceeds to the Collateral Agent for the benefit of the Secured
Parties. Until so delivered, all such proceeds shall be held in trust
by the Guarantor for and as the property of the Collateral Agent for
the benefit of the Secured Parties and shall not be commingled with
any other funds or property of the Guarantor. Upon any delivery of
proceeds of Collateral hereunder, the Collateral Agent, in its sole
discretion, may apply such proceeds (but is not so obligated to do so)
against the amounts outstanding under the Notes in accordance with
Section 15 hereof.
(b) The Guarantor shall cause the delivery to the Collateral Agent of any
Collateral that is certificated Investment Property or is evidenced by
an Instrument or Chattel Paper, with appropriate transfer powers or
endorsements (as applicable).
14. ADDITIONAL RIGHTS
In addition to, and not in diminution of, the immediately preceding
Section 13, after the occurrence of an Event of Default:
(a) The Guarantor shall, at the request of the Collateral Agent, assemble
the Collateral owned, possessed or controlled by it at such place or
places, reasonably convenient to the Collateral Agent, designated in
its request;
(b) The Collateral Agent may make any reasonable compromise or settlement
deemed desirable with respect to any of the Collateral and may extend
the time of payment, arrange for payment in installments, or otherwise
modify the terms of, any of the Collateral;
(c) The Collateral Agent shall have all of the rights and remedies with
respect to the Collateral of a secured party under the UCC (whether or
not said Code is in effect in the jurisdiction where the rights and
remedies are asserted) and such additional rights and remedies to
which a secured party is entitled under the laws in effect in any
jurisdiction where any rights and remedies hereunder may be asserted;
(d) The Collateral Agent in its discretion may, in its name or in the name
of the Guarantor or otherwise, demand, xxx for, collect or receive any
money or property
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at any time payable or receivable on account of or in exchange for any
of the Collateral, but shall be under no obligation to do so; and
(e) (1) The Collateral Agent may, upon ten business days' prior written
notice to the Guarantor (or upon such shorter notice, or without
notice, as may be permitted under the UCC) of the time and place,
with respect to the Collateral or any part thereof that shall
then be or shall thereafter come into the possession, custody or
control of the Collateral Agent or its agent, sell, lease, assign
or otherwise dispose of all or any part of such Collateral, at
such place or places as the Collateral Agent deems best, and for
cash or for credit or for future delivery (without thereby
assuming any credit risk), at public or private sale, without
demand of performance or notice of intention to effect any such
disposition or of the time or place thereof (except such notice
as is required above or by applicable statute and cannot be
waived), and the Collateral Agent or anyone else may be the
purchaser, lessee, assignee or recipient of any or all of the
Collateral so disposed of at any public sale (or, to the extent
permitted by law, at any private sale) and thereafter hold the
same absolutely, free from any claim or right of whatsoever kind,
including any right or equity of redemption (statutory or
otherwise), of the Guarantor, any such demand, notice and right
or equity being hereby expressly waived and released. 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 the
sale, and such sale may be made at any time or place to which the
sale may be so adjourned.
(2) Neither the Collateral Agent nor any other Secured Party shall
incur any liability as a result of the sale of the Collateral, or
any part thereof; at any private sale pursuant to the immediately
preceding paragraph conducted in a commercially reasonable
manner. The Guarantor hereby waives any claims against the
Collateral Agent or any other Secured Party arising by reason of
the fact that the price at which the Collateral may have been
sold at such a private sale was less than the price that might
have been obtained at a public sale or was less than the
aggregate amount of the Liabilities.
15. APPLICATION OF PROCEEDS OF SALE
The proceeds of any sale of the Collateral pursuant to Section 14
hereof, as well as any Collateral consisting of cash, shall be promptly applied
by the Collateral Agent as follows:
(a) FIRST, to payment of all reasonable costs and expenses incurred by the
Collateral Agent on behalf of all other Secured Parties in connection
with such sale or otherwise in connection with this Agreement or any
of the Liabilities or the Credit Documents, including, but not limited
to, all court costs and the reasonable fees and expenses of its agents
and legal counsel, the repayment of all advances made by the
Collateral Agent hereunder on behalf of the Guarantor and
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any other costs or expenses incurred in connection with the exercise
of any right or remedy hereunder;
(b) SECOND, to the payment in full of the Liabilities to the Collateral
Agent and the other Secured Parties in accordance with each Secured
Party's pro rata share of the Liabilities; and
(c) THIRD, to the Guarantor, its successors and assigns, or as a court of
competent jurisdiction may otherwise direct.
If the proceeds of sale, collection or other realization of or upon the
Collateral pursuant to this Section are insufficient to cover the costs and
expenses of such realization and the payment in full of the Liabilities, the
Guarantor shall remain liable for any deficiency.
16. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT
Effective only after an Event of Default, the Guarantor hereby
appoints the Collateral Agent the attorney-in-fact of the Guarantor for the
purpose of carrying out the provisions of this Agreement and taking any action
and executing any instrument which 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 of an Event of
Default, with full power of substitution either in the Collateral Agent's name
or in the name of the Guarantor, to ask for, demand, xxx for, collect, receive,
receipt and give acquittance for any and all moneys due or to become due and
under and by virtue of any Collateral, to endorse checks, drafts, orders and
other instruments for the payment of money payable to the Guarantor representing
any interest or dividend, or other distribution payable in respect of the
Collateral or any part thereof for or on account thereof and to give full
discharge for the same, to settle, compromise, prosecute or defend any action,
claim or proceeding with respect thereto, and to sell, assign, endorse, pledge,
transfer and make any agreement respecting, or otherwise deal with, the same;
provided, however, 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, and no action taken by the Collateral
Agent or omitted to be taken with respect to the Collateral shall give rise to
any cause of action against the Collateral Agent, except in the case of the
gross negligence or willful misconduct of the Collateral Agent.
17. NO WAIVER
No failure on the part of the Collateral Agent or any other Secured
Party to exercise, and no delay in exercising, any right, power or remedy
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise of any such right, power or remedy by the Collateral Agent or any other
Secured Party preclude any other or further exercise thereof or the exercise of
any other right, power or remedy. All remedies hereunder are cumulative and are
not exclusive of any other remedies provided by law. Neither the Collateral
Agent nor any other
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Secured Party shall not be deemed to have waived any rights hereunder or under
any other agreement or instrument unless such waiver shall be in writing and
signed by it.
18. NOTICES
Any notices, demands, certifications, requests, communications or the
like required to be given hereunder shall be in writing and shall be deemed to
have been validly served, given or delivered upon delivery thereof by messenger
or courier service to the respective party at the address first set forth above
or at such other address as such party may for itself designate in writing in a
like manner for the purpose of receiving notices hereunder.
19. FARTHER ASSURANCES
The Guarantor agrees to execute and deliver to Collateral Agent (and
hereby authorizes the Collateral Agent to file, in the case of (i) below, as
described below in this paragraph) such further agreements, assignments,
instruments and documents, and to do all such other things, as the Collateral
Agent may reasonably deem necessary or appropriate to assure the Collateral
Agent of the effectiveness of its Lien hereunder, including without limitation,
(i) such financing statements (including amendments to financing statements) or
other instruments and documents as the Collateral Agent may from time to time
reasonably require to comply with the UCC and any other applicable law, and (ii)
such patent, trademark, and copyright assignment agreements as the Collateral
Agent may from time to time reasonably require to comply with the filing
requirements of the United States Patent and Trademark Office and the United
States Copyright Office, and (iii) such agreements with respect to all Deposit
Accounts, Securities Accounts, Letter-of-Credit Rights, and electronic Chattel
Paper, as are required to perfect security interests and maintain priority under
the UCC, and to use commercially reasonable efforts to cause the relevant
depository institutions, financial intermediaries, and letter of credit issuers
to execute and deliver such control agreements, as the Collateral Agent may from
time to time reasonably require. The Guarantor hereby agrees that a carbon,
photographic, electronic or other reproduction of this Agreement or any such
financing statement or amendment thereto is sufficient for filing as a financing
statement by the Collateral Agent without notice thereof to the Guarantor
wherever the Guarantor in its sole discretion desires to file the same. The
Guarantor hereby authorizes the Collateral Agent to file any and all financing
statements covering the Collateral or any part thereof as the Collateral Agent
may require, including financing statements describing the Collateral as "all
assets" or "all personal property" or words of like meaning. The Collateral
Agent may order lien searches from time to time against the Guarantor and the
Collateral, and the Guarantor shall promptly reimburse Collateral Agent for all
reasonable costs and expenses incurred in connection with such lien searches.
20. BINDING AGREEMENT; ASSIGNMENTS
This Agreement, and the terms, covenants and conditions hereof, shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that the Guarantor shall not be
permitted to assign this Agreement or any interests herein or in the Collateral,
or any part thereof, or any cash or property held by the Collateral Agent as
Collateral under this Agreement without the prior written consent of the
Collateral Agent, which may be withheld in the sole discretion of the Collateral
Agent.
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21. MODIFICATION
No modification, amendment or waiver of any provision of this
Agreement nor any consent to any departure by the Guarantor herefrom, shall in
any event be effective unless the same shall be in writing and signed by the
Collateral Agent and the Guarantor and then such modification, amendment, waiver
or consent shall be effective only in the specific instance and for the purpose
for which it is given.
22. GOVERNING LAW
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, EXCEPT AS REQUIRED BY MANDATORY PROVISION OF
LAW AND EXCEPT TO THE EXTENT THAT THE VALIDITY AND PERFECTION OR THE PERFECTION
AND THE EFFECTIVE PERFECTION OR NON-PERFECTION OF THE SECURITY INTEREST AND LIEN
CREATED HEREBY, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL
ARE GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
23. SEVERABILITY
In case any one or more of the provisions contained in this Agreement
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired.
24. COUNTERPARTS
This Agreement may be executed in two or more counterparts, each of
which shall constitute an original, but all of which, when taken together, shall
constitute but one instrument.
25. SECTION HEADINGS
Section headings used herein are for convenience only and are not to
affect the construction of, or be taken into consideration in interpreting, this
Agreement.
26. DEFINITIONS GENERALLY
Unless otherwise defined herein, each term capitalized herein but not
defined herein shall have the meaning set forth for such term in the Notes or,
if not defined therein, in the Securities Purchase Agreement.
27. RECITALS
The recitals hereto are incorporated herein by reference as if set
forth at length herein.
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28. JURISDICTION; JURY TRIAL
Each party hereby irrevocably submits to the non-exclusive
jurisdiction of the New York State courts or Federal courts sitting in the
borough of Manhattan, State of New York, for the adjudication of any dispute
hereunder or in connection herewith or with any transaction contemplated hereby
or discussed herein, and hereby irrevocably waives, and agrees not to assert in
any suit, action or proceeding, any claim that it is not personally subject to
the jurisdiction of any such court, that such suit, action or proceeding is
brought in an inconvenient forum or that the venue of such suit, action or
proceeding is improper. Each party hereby irrevocably waives personal service of
process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address for such
notices to it under this Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve process in any
manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY
HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY
DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY
TRANSACTION CONTEMPLATED HEREBY.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
MITEL NETWORKS, INC.
By: /s/ Illegible
-------------------------------
Authorized Signing Officer
HIGHBRIDGE INTERNATIONAL LLC
BY: HIGHBRIDGE CAPITAL
MANAGEMENT, LLC
By:
-------------------------------
Name: Xxx X. Xxxxxx
Title: Managing Director
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first above written.
MITEL NETWORKS, INC.
By:
-------------------------------
Authorized Signing Officer
HIGHBRIDGE INTERNATIONAL LLC,
as Collateral Agent
BY: HIGHBRIDGE CAPITAL
MANAGEMENT, LLC
By: /s/ Xxxx X. Chill
-------------------------------
Name: Xxxx X. Chill
Title: Managing Director
