Exhibit 4.6
Conformed Copy
SECURITY AGREEMENT
This SECURITY AGREEMENT (this "Agreement"), dated as
of April 18, 1997, is among DEL MONTE CORPORATION, a New York
corporation (the "Company"); DEL MONTE FOODS COMPANY, a Maryland
corporation (the "Parent") (the Company and the Parent
collectively, the "Debtors" and individually each a "Debtor");
and BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, in
its capacity as administrative agent for the Lender Parties
referred to below (in such capacity, together with its successors
in such capacity, the "Administrative Agent").
W I T N E S S E T H
WHEREAS, the Company has entered into a Credit
Agreement, dated as of April 18, 1997 (as amended, supplemented,
restated or otherwise modified from time to time, the "Credit
Agreement"), with the several financial institutions from time to
time party to the Credit Agreement, the Administrative Agent,
Bankers Trust Company, as documentation agent, and The First
National Bank of Boston, Citicorp USA, Inc., General Electric
Capital Corporation and The Long-Term Credit Bank of Japan, Ltd.,
Los Angeles Agency, as co-agents, pursuant to which such
financial institutions have agreed to make available to the
Company term loans and a revolving credit facility with a letter
of credit subfacility;
WHEREAS, the Parent has executed and delivered that
certain Parent Guaranty of even date herewith (as amended,
supplemented, restated or otherwise modified from time to time,
the "Parent Guaranty") covering the obligations of the Company
under the Credit Agreement;
WHEREAS, the obligations of the Company and the other
Obligors under the Credit Agreement and the other Loan Documents
and the obligations of the Parent under the Parent Guaranty and
the other Loan Documents are to be secured pursuant to this
Agreement;
WHEREAS, as a condition to the making of extensions of
credit under the Credit Agreement, each of the Debtors has duly
authorized the execution, delivery and performance of this
Agreement; and
WHEREAS, it is in the best interests of the Parent to
execute this Agreement inasmuch as the Parent will derive
substantial direct and indirect benefits from the making of the
Loans and the issuance of the Letters of Credit.
NOW, THEREFORE, for and in consideration of any loan,
advance or other financial accommodation heretofore or hereafter
made to the Company under or in connection with the Credit
Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Definitions. When used herein, (a) the terms Account,
Certificated Security, Chattel Paper, Deposit Account, Document,
Equipment, Fixture, General Intangible, Goods, Inventory,
Instrument, Money, Security and Uncertificated Security have the
respective meanings assigned to such terms in the Uniform
Commercial Code (as defined below), (b) the terms Commodity
Account, Commodity Contract, Investment Property, Security
Entitlement and Securities Account have the respective meanings
assigned thereto in the 1994 Amendments to Articles 8 and 9 of
the Uniform Commercial Code promulgated by the American Law
Institute and the National Conference of Commissioners for
Uniform State Laws and (c) the following terms have the following
meanings (such definitions to be applicable to both the singular
and plural forms of such terms):
Account Debtor means the party who is obligated on or
under any Non-Tangible Collateral.
Assignee Deposit Account - see Section 4.
Benefits - see Section 6.
Cash Instruments means all cash, checks, drafts and
other instruments or writings for the payment of money.
Collateral means, with respect to any Debtor, all
property and rights of such Debtor in which a security interest
is granted hereunder.
Computer Hardware and Software means, with respect to
any Debtor, all of such Debtor's rights (including without
limitation rights as licensee and lessee) with respect to: (i)
all computer and other electronic data processing hardware,
including without limitation all integrated computer systems,
central processing units, memory units, display terminals,
printers, computer elements, card readers, tape drives, hard and
soft disk drives, cables, electrical supply hardware, generators,
power equalizers, accessories, peripheral devices and other
related computer hardware; (ii) all operating system software,
utilities and application programs in whatsoever form (source
code and object code in magnetic tape, disk or hard copy format
or any other listings whatsoever) designed for use on the
computers and electronic data processing hardware described in
clause (i) above; (iii) all firmware associated with any of the
foregoing; and (iv) any documentation for hardware, software and
firmware described in clauses (i), (ii) and (iii) above,
including without limitation flow charts, logic diagrams,
manuals, specifications, training materials, charts and pseudo
codes.
Concentration Account - see Section 7(a).
Concentration Bank means First Chicago NBD
Corporation, in its capacity as bank at which the Concentration
Account is maintained, or any successor thereto appointed
pursuant to Section 7.
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Contract Right means, with respect to any Debtor, any
right of such Debtor to payment under a contract for the sale or
lease of goods or the rendering of services, which right is at
the time not yet earned by performance.
Default means the occurrence of: (a) any Unmatured
Event of Default under subsection 9.1(f) or (g) of the Credit
Agreement; or (b) any Event of Default.
Disbursement Account - see Section 7(a).
Disbursement Bank means any of the banks or other
financial institutions listed as a "Disbursement Bank" on
Schedule V hereto, as amended from time to time in accordance
with Section 7(c).
Intellectual Property means, with respect to any
Debtor, all of such Debtor's rights now or hereafter acquired
(including without limitation rights as licensor, licensee,
lessor or lessee) in all: trade secrets and other proprietary
information; trademarks, service marks, business names, designs,
logos, indicia and other source and/or business identifiers, and
the goodwill of the business relating thereto and all
registrations or applications for registrations which have
heretofore been or may hereafter be issued or filed thereon and
all renewals thereof throughout the world; copyrights (including
without limitation copyrights for computer programs) and
copyright registrations or applications for registrations which
have heretofore been or may hereafter be issued or filed,
including all renewals thereof, throughout the world and all
tangible property embodying the copyrights; unpatented inventions
(whether or not patentable); patent applications and patents; and
all reissues, divisions, continuations, extensions, renewals and
continuations-in-part of any of the foregoing; industrial
designs, industrial design applications and registered industrial
designs; license agreements related to any of the foregoing and
income therefrom; books, records, writings, computer tapes or
disks, flow diagrams, specification sheets, source codes, object
codes and other physical manifestations, embodiments or
incorporations of any of the foregoing; the right to xxx for all
past, present and future infringements of any of the foregoing;
and all common law and other rights throughout the world in and
to all of the foregoing.
Intercreditor Agreement means that certain Amended and
Restated Intercreditor Agreement, dated as of December 5, 1989,
among The First National Bank of Chicago, as administrative
agent, and the Creditors (as defined therein) which are now or
hereafter become parties thereto.
Lender Party means each Agent and each Lender under
and as defined in the Credit Agreement and any Affiliate of such
a Lender which is a party to a Swap Contract with the Company.
Liabilities means (i) all Obligations owing by the
Company, Parent or, any Subsidiary (including post-petition
interest), and (ii) all Permitted Swap Obligations (monetary or
otherwise) of the Company under any Swap Contract with a Lender
Party (other than Swap Contracts that, by their terms, are
unsecured); provided, however, that the term "Liabilities" shall
not include any obligations arising under any Environmental
Indemnity.
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License Agreement means that License Agreement date as
of April 18, 1997, between the Company and the Administrative
Agent, as may be amended, supplemented, restated or otherwise
modified from time to time.
Lockbox Account - see Section 7(a).
Lockbox - see Section 7(a).
Non-Tangible Collateral means, with respect to any
Debtor, collectively, such Debtor's Accounts, Contract Rights and
General Intangibles.
Obligor means the Company, the Parent or any other
Person (other than any Agent or any Lender or their permitted
successors and assigns) obligated under any Loan Document, and
their permitted successors and assigns.
Permitted Senior Security Interest has the meaning set
forth in the Intercreditor Agreement.
Primary Intellectual Property Collateral means that
portion, to the extent subject to the Intercreditor Agreement, of
the Collateral relating to or arising from the Intellectual
Property arising under the laws of or located in the United
States with respect to products produced and sold by the Company
in its business, excluding, however, from the foregoing, as long
as a Prior Arrangement with respect thereto in favor of a third
party remains in effect, any of such Collateral used with respect
to those products covered by the license agreements listed as
items 1, 3, 12 and 15 of Schedule A to the License Agreement.
Prior Arrangements has the meaning set forth in the
License Agreement.
Receiving Account - see Section 7(a).
Receiving Bank means any of the banks or other
financial institutions listed as a "Receiving Bank" on Schedule V
hereto, as amended from time to time in accordance with Section
7(c) which banks are all the Banks that maintain Lockbox Accounts
or Receiving Accounts.
Trademarks means, with respect to any Debtor, all of
such Debtor's rights now or hereafter acquired (including without
limitation rights as licensor, licensee, lessor or lessee) in all
trademarks (including without limitation the trademarks listed on
Schedule IV attached hereto), all designs and logotypes related
to such trademarks, in any and all forms, and all trademark
registrations and applications for registration related to such
trademarks, including the right to xxx for all past, present and
future infringements of any of the foregoing and all common law
and other rights throughout the world in and to all of the
foregoing.
Trade Secrets means, with respect to any Debtor, all
of such Debtor's rights now or hereafter acquired in all trade
secrets (including without limitation the trade secrets listed on
Schedule VI hereto), including the right to xxx for all past,
present and future infringements of
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any of the foregoing and all common law and other rights throughout
the world in and to all of the foregoing.
Uniform Commercial Code means the Uniform Commercial
Code as in effect in the State of New York on the date of this
Agreement; provided, however, as used in Section 8 hereof and in
the definitions of "Commodity Account", "Commodity Contract",
"Investment Property", "Security Entitlement" and "Securities
Account", "Uniform Commercial Code" shall mean the Uniform
Commercial Code as in effect from time to time in the applicable
jurisdiction.
Terms used herein and not otherwise defined herein
shall have the meanings assigned to such terms in the Credit
Agreement.
2. Grant of Security Interest. As security for the
payment of all Liabilities, each Debtor hereby assigns to the
Administrative Agent for the benefit of the Lender Parties, and
grants to the Administrative Agent for the benefit of the Lender
Parties, a continuing security interest in the following, whether
now or hereafter existing or acquired:
All of such Debtor's:
(i) Accounts;
(ii) Certificated Securities;
(iii) Chattel Paper;
(iv)Computer Hardware and Software and all rights
with respect thereto, including without limitation
all licenses, options, warranties, service
contracts, program services, test rights,
maintenance rights, support rights, improvement
rights, renewal rights and indemnifications, and
all substitutions, replacements, additions or
model conversions of any of the foregoing;
(v) Contract Rights;
(vi) Deposit Accounts;
(vii) Documents;
(viii) General Intangibles;
(ix)Goods (including without limitation all of its
Equipment, Fixtures and Inventory), and all
accessions, additions, attachments, improvements,
substitutions and replacements thereto and
therefor;
(x) Instruments;
(xi) Intellectual Property;
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(xii) Money;
(xiii)Commodity Accounts, Commodity Contracts,
Investment Property, Security Entitlements and Securities
Accounts;
(xiv) Uncertificated Securities; and
(xv) to the extent not included in the foregoing, other
personal property of any kind or description;
together with all books, records, writings, data
bases, information and other property relating to,
used or useful in connection with, or evidencing,
embodying, incorporating or referring to any of
the foregoing, and all proceeds, products,
offspring, rents, issues, profits and returns of
and from any of the foregoing.
3. Warranties. Each Debtor warrants to the
Administrative Agent and each Lender Party that: (i) no financing
statement (other than any which may have been filed on behalf of
the Administrative Agent or in connection with Permitted Liens)
covering any of the Collateral is on file in any public office,
except for those relating to the Debt to be Repaid; (ii) such
Debtor is and will be the lawful owner of all of its Collateral,
free of all liens and claims whatsoever, other than the security
interest hereunder and Permitted Liens with full power and
authority to execute this Agreement and perform such Debtor's
obligations hereunder, and to subject the Collateral to the
security interest hereunder; (iii) all information with respect
to Collateral and Account Debtors set forth in any schedule,
certificate or other writing delivered on the Closing Date or
hereafter furnished by such Debtor to the Administrative Agent or
any Lender Party is and will be true and correct in all material
respects as of the date furnished; (iv) such Debtor's chief
executive office and principal place of business are as set forth
on Schedule I hereto (and such Debtor has not maintained its
chief executive office and principal place of business at any
other location at any time after January 1, 1996); (v) each other
location where such Debtor maintains a place of business (or
where Goods of such Debtor are located) is set forth on Schedule
II hereto, and no Goods of any Debtor have been kept at any other
place during the four months preceding the date of this
Agreement; (vi) except as set forth on Schedule III hereto, such
Debtor is not now known and during the five years preceding the
date hereof has not previously been known by any trade name;
(vii) except as set forth on Schedule III hereto, during the five
years preceding the date hereof such Debtor has not been known by
any legal name different from the one set forth on the signature
pages of this Agreement with respect to such Debtor nor has such
Debtor been the subject of any merger or other corporate
reorganization (other than, with respect to the Parent, the
Merger); (viii) Schedule IV hereto contains a complete listing of
all of such Debtor's Intellectual Property which is the subject
of a pending or issued registration statute (including without
limitation registrations and applications therefor), and such
Debtor is the exclusive owner of the entire and unencumbered
right, title and interest in and to such Intellectual Property
but subject to the Intercreditor Agreement and the Prior
Arrangements; (ix) such Debtor is a corporation duly organized,
validly existing and in good standing under the laws of the state
of its incorporation; (x) the execution and delivery of this
Agreement and the
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performance by such Debtor of its obligations hereunder are
within such Debtor's corporate powers, have been duly authorized
by all necessary corporate action, have received all necessary
governmental approval (if any shall be required), and do not and
will not contravene or conflict with any provision of law or of
the charter or by-laws of such Debtor or of any material
agreement, indenture, instrument or other document, or any
material judgment, order or decree, which is binding upon such
Debtor; (xi) this Agreement is a legal, valid and binding
obligation of such Debtor, enforceable in accordance with its
terms, except that the enforceability of this Agreement may be
limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and by equitable principles relating
to enforceability; (xii) such Debtor is in compliance with the
requirements of all applicable laws (including without limitation
the provisions of the Fair Labor Standards Act), rules,
regulations and orders of every governmental authority, the
non-compliance with which would reasonably be expected to result
in a Material Adverse Effect; (xiii) [intentionally omitted];
(xiv) the Parent has no Subsidiary other than the Company, and
the Company has no other Subsidiary except as disclosed in
Schedule 6.15 of the Credit Agreement; (xv) if the Collateral
includes Inventory located in the State of California, such
Debtor is not a "retail merchant" within the meaning of Section
9102 of the Uniform Commercial Code - Secured Transactions of the
State of California; (xvi) the Company has delivered or caused to
be delivered to the Administrative Agent a copy of the most
recent and fully executed Intercreditor Agreement which has been
certified as true, correct and complete by an authorized officer
of the Company and which is in full force and effect; (xvii) the
Intercreditor Agreement has not been amended, supplemented,
restated or otherwise modified in any respect since the date the
certified copy of the Intercreditor Agreement described in clause
(xvi) above was last delivered to the Administrative Agent;
(xviii) the Company has delivered or caused to be delivered to
the Administrative Agent a list identifying all of the Creditors
(as defined in the Intercreditor Agreement) currently party to
the Intercreditor Agreement as of the date hereof; (xix) the
Intellectual Property covered by the Intercreditor Agreement is
truly, correctly and completely described in all material
respects in the License Agreement; (xx) all of (a) the Cash
Instruments in the Lockboxes, Lockbox Accounts, Receiving
Accounts, Concentration Accounts and Disbursement Accounts and
all other Deposit Accounts, (b) the Lockbox Accounts, the
Receiving Accounts, the Concentration Accounts and the
Disbursement Accounts and all other Deposit Accounts, and (c) all
other Money from time to time on deposit in any of the accounts
described in the immediately preceding clause (b) and all
investments thereof and proceeds from such investments, are owned
by the Parent or the Company, or both, and no other Person holds
any right, title or interest to such Cash Instruments, Deposit
Accounts, Money or investments; and (xxi) as of the Closing Date
and upon the execution of the Intercreditor Agreement by the
Administrative Agent and delivery to each of the Creditors (as
defined thereunder): (a) the Liabilities are Eligible Senior
Claims (as defined in the Intercreditor Agreement) and the
security interest granted hereunder in the Primary Intellectual
Property Collateral held by the Administrative Agent for the
benefit of the Lender Parties is a Permitted Senior Security
Interest, (b) such Eligible Senior Claims of a Lender Party
secured by such Permitted Senior Security Interest in clause
(xxi)(a) above have a Value Share (as defined in the
Intercreditor Agreement) greater than zero (as calculated and
determined under the Intercreditor Agreement), (c) there are no
Permitted Non-Lender Licenses (as defined in the Intercreditor
Agreement) with respect to any of the Primary Intellectual
Property Collateral, (d) there are no Eligible Senior Claims
secured by Permitted Senior Security Interests in the Primary
Intellectual Property Collateral
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with a Value Share greater than zero (as calculated and
determined under the Intercreditor Agreement) other than the
Liabilities, (e) there are no Liens on the Primary Intellectual
Property Collateral except the security interests granted
hereunder and under the License Agreement, and the Permitted
Licensee Security Interests (as defined in the Intercreditor
Agreement) securing Eligible Licensee Claims (as defined in the
Intercreditor Agreement) held by licensees under the Prior
Arrangements, (f) the security interest granted hereunder is a
valid and, upon due filings, perfected Lien upon the Primary
Intellectual Property Collateral granted hereunder, and is a
first priority Lien thereon subject only to the Permitted
Licensee Security Interests referenced in clause (xxi)(e) above,
and (g) all of the Creditors (as defined in the Intercreditor
Agreement) are those Persons parties to the Permitted Security
Agreements.
4. Collections, etc. Until such time after the
occurrence and during the continuance of a Default as the
Administrative Agent shall notify such Debtor of the revocation
of such power and authority, each Debtor (a) may, in the ordinary
course of its business, at its own expense, sell, assign, lease,
convey, transfer or otherwise dispose of or furnish under
contracts of service free and clear of the Liens in this
Agreement and all other Collateral Documents any of the Inventory
normally held by such Debtor for such purpose, use and consume,
in the ordinary course of its business, any raw materials, work
in process or materials normally held by such Debtor for such
purpose, and use, in the ordinary course of its business (but
subject to the terms of the Credit Agreement and Section 7 of
this Agreement), the cash proceeds of Collateral and other money
which constitutes Collateral, (b) will, at its own expense,
endeavor to collect, as and when due, all amounts due under any
of the Non-Tangible Collateral, including the taking of such
commercially reasonable action with respect to such collection as
the Administrative Agent may reasonably request or, in the
absence of such request, as such Debtor may deem advisable, and
(c) may grant, in the ordinary course of business, to any party
obligated on any of the Non-Tangible Collateral, any rebate,
refund or allowance to which such party may be lawfully entitled,
and may accept, in connection therewith, the return of Goods, the
sale or lease of which shall have given rise to such Non-Tangible
Collateral and may grant extensions of time to pay amounts due
and such other modifications of payment terms as shall be
commercially reasonable in the circumstances. The Administrative
Agent, however, may, after the occurrence and during the
continuance of a Default, whether before or after any revocation
of such power and authority or the maturity of any of the
Liabilities and, with contemporaneous notice to the Company
(provided that the failure to give such notice shall not give
rise to any liability to the Administrative Agent or any Lender
Party), notify any parties obligated on any of the Non-Tangible
Collateral to make payment to the Administrative Agent of any
amounts due or to become due thereunder and enforce collection of
any of the Non-Tangible Collateral by suit or otherwise and
surrender, release or exchange all or any part thereof, or
compromise or extend or renew for any period (whether or not
longer than the original period) any indebtedness thereunder or
evidenced thereby. Upon request of the Administrative Agent after
the occurrence and during the continuance of a Default, each
Debtor will, at its own expense, notify any or all parties
obligated on any of the Non-Tangible Collateral to make payment
to the Administrative Agent of any amounts due or to become due
thereunder.
Upon request by the Administrative Agent after the
occurrence and during the continuance of a Default, each Debtor
will forthwith, upon receipt, transmit and deliver to the
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Administrative Agent, in the form received, all Cash Instruments
(properly endorsed, where required, so that such items may be
collected by the Administrative Agent) which may be received by
such Debtor at any time in full or partial payment or otherwise
as proceeds of any of the Collateral. Except as the
Administrative Agent may otherwise consent in writing, any such
Cash Instruments which may be so received by any Debtor will not
be commingled with any other of its funds or property, but will
be held separate and apart from its own funds or property and
upon express trust for the Administrative Agent until delivery is
made to the Administrative Agent. Each Debtor will comply with
the terms and conditions of any consent given by the
Administrative Agent pursuant to the foregoing sentence.
After the occurrence and during the continuance of a
Default, all items or amounts which are delivered by any Debtor,
any Receiving Bank, the Concentration Bank or any bank or other
financial institution maintaining a Lockbox or a Lockbox Account
to the Administrative Agent on account of partial or full payment
or otherwise as proceeds of any of the Collateral shall be
deposited to the credit of a deposit account (each, an "Assignee
Deposit Account") of such Debtor with the Administrative Agent,
as security for payment of the Liabilities. No Debtor shall have
any right to withdraw any funds deposited in any Assignee Deposit
Account. Subject to the terms and provisions of the Credit
Agreement (including without limitation, Section 10.11(d)
thereof), the Administrative Agent may, from time to time, in its
discretion, and shall upon request of the applicable Debtor made
not more than once in any week, apply all or any of the then
balance, representing collected funds, in the Assignee Deposit
Account toward payment of the Liabilities, whether or not then
due, in such order of application as the Administrative Agent may
determine, and the Administrative Agent may, from time to time,
in its discretion, release all or any of such balance to the
applicable Debtor.
After the occurrence and during the continuance of a
Default, the Administrative Agent is authorized to endorse, in
the name of the applicable Debtor, any item, howsoever received
by the Administrative Agent, representing any payment on or other
proceeds of any of the Collateral.
5. Certificates, Schedules and Reports. Each Debtor
will deliver to the Administrative Agent such schedules,
certificates and reports respecting all or any of the Collateral
subject to the security interest hereunder, and the items or
amounts received by such Debtor in full or partial payment of any
of the Collateral, as the Administrative Agent may reasonably
request from time to time in connection with the renewal of the
Collateral, or the protection, preservation, maintenance or
enforcement of the security interest granted hereunder or the
Collateral including, without limitation, all documents and
things in such Debtor's possession, or subject to its demand for
possession, related to the production and sale by such Debtor, or
any Affiliate, Subsidiary, licensee or subcontractor thereof, of
products or services sold by or under the authority of such
Debtor in connection with the Trademarks or Trade Secrets,
including by way of example, without limiting the interest
granted by this Agreement: (i) all lists and ancillary documents
which identify and describe any of such Debtor's customers, or
those of its Affiliates, Subsidiaries or licensees, for products
sold or services rendered under or in connection with the
Trademarks or Trade Secrets, including, without limitation, such
existing lists and ancillary documents which contain each
customer's full name and address, the full name
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and address of all of its warehouses and branches, the identity
of the Person or Persons having the principal responsibility on
each customer's behalf for ordering products or services of the
kind supplied by such Debtor, the credit, payment, discount,
delivery and other sale terms applicable to such customer,
together with detailed information setting forth the total
purchases, by brand, product, style and size, and the patterns of
such purchases; (ii) all product and service specification
documents and production and quality control manuals used in the
manufacture of products or provision of services sold under or in
connection with the Trademarks or Trade Secrets; (iii) all
documents which reveal the names and addresses of all sources of
supply, and all terms of purchase and delivery, for all materials
and components used in the production of products or provision of
services, sold under or in connection with the Trademarks or
Trade Secrets; and (iv) all documents constituting or concerning
the then current or proposed advertising and promotion by such
Debtor or its Affiliates, Subsidiaries or licensees of products
or services sold under or in connection with the Trademarks or
Trade Secrets, including, by way of example and not in
limitation, all documents which reveal the media used or to be
used and the cost for all such advertising conducted within the
described period or planned for such products or services. In
connection with its enforcement of the security interest granted
hereunder, the Administrative Agent may use such information or
transfer it to any assignee or sublicensee permitted hereunder
for such assignee's or sublicensee's use.
The parties hereto shall take all reasonable action to
preserve the confidentiality of the Trade Secrets and all other
information disclosed by any Debtor pursuant to this Agreement.
Any schedule, certificate or report delivered
hereunder shall be executed by a duly authorized officer of the
applicable Debtor and shall be in such form and detail as the
Administrative Agent may reasonably specify. Each Debtor shall
immediately notify the Administrative Agent of the occurrence of
any event causing any loss or depreciation in the value of its
Inventory or other Goods which is material to the Company and its
Subsidiaries taken as a whole, and such notice shall specify the
amount of such loss or depreciation.
6. Agreements of the Debtors. Each Debtor: (a) will,
upon request of the Administrative Agent, execute such financing
statements and other documents (and pay the cost of filing or
recording the same in all public offices deemed appropriate by
the Administrative Agent) and do such other acts and things
(including, without limitation, delivery to the Administrative
Agent of any Instruments or Certificated Securities which
constitute Collateral), all as the Administrative Agent may from
time to time reasonably request, to establish and maintain a
valid security interest in the Collateral (free of all other
Liens, claims and rights of third parties whatsoever, other than
Permitted Liens) to secure the payment of the Liabilities; (b)
will keep all its Inventory at, and will not maintain any place
of business at any location other than, its address(es) shown on
Schedules I and II hereto or at such other addresses of which
such Debtor shall have given the Administrative Agent not less
than 30 days' prior written notice, provided that no such notice
shall be required for Inventory which is (i) located in any
jurisdiction in which the Administrative Agent has filed a valid
and effective financing statement covering such Inventory, and
(ii) stored at another address under a temporary arrangement in
the ordinary course of business; (c) will keep its records
concerning the Non-Tangible Collateral in such a manner as will
enable the Administrative Agent or its designees to determine at
any time
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the status of the Non-Tangible Collateral; (d) will furnish the
Administrative Agent such information concerning such Debtor, the
Collateral and the Account Debtors as the Administrative Agent
may from time to time reasonably request; (e) will provide or
cause to be provided the representatives and independent
contractors of the Administrative Agent or any Lender the
inspection rights and other rights and benefits set forth in
Section 7.10 of the Credit Agreement; (f) will, upon the
reasonable request of the Administrative Agent, stamp on its
records concerning the Collateral, and add on all Chattel Paper
constituting a portion of the Collateral, a notation, in form
satisfactory to the Administrative Agent, of the security
interest of the Administrative Agent hereunder; (g) except as
permitted by Section 8.2 of the Credit Agreement, will not, and
will not permit any of its Subsidiaries to, directly or
indirectly, sell, assign, lease, convey, transfer or otherwise
dispose of any Collateral or except as permitted by Section 8.1
of the Credit Agreement, create, incur, assume or suffer to exist
any Lien upon or with respect to any part of the Collateral; (h)
will obtain or cause to be obtained the type of insurance set
forth in Section 7.6 of the Credit Agreement, and cause all such
policies to provide that loss thereunder shall be payable to the
Administrative Agent and the Company such that (1) losses less
than or equal to Five Million Dollars ($5,000,000) per occurrence
shall be payable to the Company only, and (2) losses in excess of
Five Million Dollars ($5,000,000) per occurrence shall be payable
to the Administrative Agent, and such policies or certificates
thereof shall, if the Administrative Agent so requests, be
deposited with or furnished to the Administrative Agent; (i) will
amend and maintain each liability insurance policy insuring such
Debtor, its Inventory or other goods so that each such insurance
policy names the Administrative Agent as an additional insured;
(j) will maintain and preserve its property in the same manner as
set forth in Section 7.5 of the Credit Agreement; (k) will
promptly pay when due all license fees, registration fees, taxes,
assessments and other charges which may be levied upon or
assessed against the ownership, operation, possession,
maintenance or use of its Equipment and other Goods (as
applicable) other than any such items being contested by
appropriate proceedings if such Debtor maintains adequate
reserves therefor in conformity with GAAP; (l) will, upon
reasonable request of the Administrative Agent, (i) cause to be
noted on the applicable certificate, in the event any of its
Equipment is covered by a certificate of title, the security
interest of the Administrative Agent in the Equipment covered
thereby, and (ii) deliver all such certificates covering the
Equipment to the Administrative Agent or its designees; (m) (i)
at any time that the Company, the Parent, any Subsidiary or any
Affiliate of the Company receives any Certificated Security,
intercompany note, other note, Instrument or Chattel Paper with a
face amount or fair market value in excess of $250,000, will
promptly notify the Administrative Agent of such receipt, and
(ii) will take all steps reasonably necessary to protect,
preserve and maintain all of its rights in the Collateral,
including, without limitation, delivery of all Chattel Paper and
Instruments to the Administrative Agent upon request by the
Administrative Agent therefor; (n) during the term hereof, upon
becoming aware of any change in the identity of any of the
parties to the Intercreditor Agreement, such Debtor shall
promptly, but in no event later than fifteen (15) days
thereafter, provide or cause to be provided, notice of the same
to the Administrative Agent and, upon reasonable request of the
Administrative Agent, promptly but in no event later than fifteen
(15) days after such reasonable request, provide or cause to be
provided to the Administrative Agent an updated list of the
Persons then party to the Intercreditor Agreement; and (o) will
reimburse the Administrative Agent for all reasonable, documented
and out-of-pocket expenses, including
11
without limitation Attorney Costs, incurred by the Administrative
Agent in seeking to collect or enforce any rights in respect of
such Debtor's Collateral.
Each Debtor covenants and agrees that it shall not
create or permit to exist any Lien (including license rights)
upon the Primary Intellectual Property Collateral except the
security interest granted hereunder and except those Liens
referenced in Section 3(xxi)(d) and (e) hereof. Each Debtor
covenants and agrees that it shall not enter into or permit to
exist any license agreements other than those in effect on the
Closing Date and other than future license agreements which do
not provide for the licensing of any rights or interests in the
Primary Intellectual Property Collateral and which do not result
in any party (other than those referenced in Section 3(xxi)(d)
and (e) hereof) holding an Eligible Senior Claim (as defined in
the Intercreditor Agreement) secured by a Permitted Senior
Security Interest in the Primary Intellectual Property Collateral
with a Value Share (as defined in the Intercreditor Agreement)
greater than zero (as determined and calculated under the
Intercreditor Agreement).
Without limiting clause (a) of the immediately
preceding paragraph, each Debtor shall, contemporaneously
herewith, execute and deliver to the Administrative Agent a
Patent Security Agreement, a Trademark Security Agreement and a
Copyright Security Agreement in the forms of Exhibits A, B and C
hereto.
Any loss benefits ("Benefits") under any insurance
policy maintained by a Debtor shall be held as additional
Collateral hereunder. So long as no Default shall have occurred
and be continuing, and with respect to such Benefits payable to
the Administrative Agent pursuant to Section 6(h) hereof, the
Administrative Agent shall, upon the Company's instruction and
net of collection expenses, if any, (i) release to the Company
the amount of such Benefits to the extent that the Company has
submitted a written request to use such Benefits for the
financing of the replacement, substitution or restoration of the
assets sustaining the casualty loss giving rise to such Benefits,
and (ii) apply in all other circumstances any Benefits not used
as described in clause (i) toward the payment of the Liabilities
as provided in Section 2.8 of the Credit Agreement and/or toward
reduction of the Commitments as provided in Section 2.6 of the
Credit Agreement. Whenever a Default shall have occurred and be
continuing, all of the Benefits payable to the Administrative
Agent in accordance with Section 6(h) hereof shall be applied by
the Administrative Agent toward the payment of the Liabilities in
such order or form as the Administrative Agent shall determine,
subject to the Credit Agreement (including, without limitation,
Section 10.11(d) thereof).
Any reasonable expenses incurred in protecting,
preserving or maintaining any Collateral shall be borne by the
applicable Debtor. Whenever a Default shall have occurred and be
continuing, the Administrative Agent shall have the right to
bring suit to enforce any or all of the Intellectual Property or
the licenses thereunder, in which event the applicable Debtor
shall at the request of the Administrative Agent do any and all
lawful acts and execute any and all proper documents reasonably
required by the Administrative Agent in aid of such enforcement
and such Debtor shall promptly, upon demand, reimburse and
indemnify the Administrative Agent for all reasonable, documented
and out-of-pocket costs and expenses incurred by the
Administrative Agent in the exercise of its rights under this
Section 6; provided, however, that the
12
Administrative Agent shall have n6 obligation to bring, and will
suffer no liability for any failure to bring, any such suits.
7. Procedures With Respect To Cash.
(a) Subject to the last two sentences of the first
paragraph of Section 4 of this Agreement, each Debtor shall
instruct each Account Debtor obligated to make payments under any
item of Non-Tangible Collateral to make such payments to
lockboxes identified on Schedule V, Item A or a zip code
maintained for the exclusive use of such Debtor by a financial
institution (the "Lockboxes"). Each Debtor shall, with respect to
all Cash Instruments (other than Cash Instruments deposited in a
Lockbox) it holds or receives, transmit, and shall instruct any
financial institution which receives for the account of such
Debtor any Cash Instruments (other than Cash Instruments
deposited in a Lockbox), other than a Disbursement Bank, to
transmit, in the form received, before the close of business on
the Business Day following receipt, all Cash Instruments to a
Receiving Bank for deposit into a deposit account identified on
Schedule V, Item B (a "Receiving Account") or to the
Concentration Bank for deposit into the Concentration Account.
The Company and the Administrative Agent shall instruct each
Receiving Bank maintaining a Lockbox pursuant to this Section to
deposit all Cash Instruments paid into such Lockbox forthwith in
the deposit account associated with such Lockbox (the "Lockbox
Account"), maintained by such Receiving Bank (except that the
Company may otherwise instruct such Receiving Bank with respect
to items which are post-dated or irregular and provided that Cash
Instruments sent to a post office located in a city other than in
which the related Lockbox Account is located may first be
deposited into an account maintained by the Receiving Bank with a
correspondent bank and may then be deposited in a clearing
account maintained by the Receiving Bank before being deposited
in such Lockbox Account) and shall further instruct each
Receiving Bank to transfer all items deposited into such Lockbox
Accounts and Receiving Accounts to the concentration account
identified on Schedule V, Item D (the "Concentration Account")
maintained at the Concentration Bank upon the clearing of such
items in accordance with such Receiving Bank's customary clearing
schedule but not later than ten (10) days after receipt);
provided that whenever a Default has occurred and is continuing
the Administrative Agent may notify the Receiving Banks to
transfer all such items to an Assignee Deposit Account.
Unless a Default has occurred and is continuing, the
Company shall be entitled to instruct the Concentration Bank to
transfer amounts held in the Concentration Account to one or more
disbursement accounts identified on Schedule V, Item C (each
individually, a "Disbursement Account"). On any business day
prior to the occurrence and continuance of a Default, the Company
may transfer (i) to each of the accounts held at First State Bank
Xxxx Xxxxxxx as set forth on Schedule V, an amount not to exceed
$5,000 minus the balance in such account at the beginning of such
business day, (ii) to each of the Company's pension accounts,
payroll accounts, and health and welfare benefit plan accounts,
an amount equal to all accrued pension, payroll, or health and
welfare benefit plan obligations and taxes that are due and
payable, and (iii) to each other Disbursement Account, an
aggregate amount equal to all unpaid checks presented to such
Disbursement Bank and not returned as of the preceding Business
Day. It is understood that each Disbursement Account other than
pension accounts, payroll accounts,
13
health and welfare benefit plan accounts and the accounts
referred to in clause (i) of the preceding sentence will be a
"zero-balance account". Any balance remaining in such "zero
balance" Disbursement Account after all disbursements have been
made with respect to such Disbursement Account on a given
business day shall be returned to the Concentration Account by
wire transfer of funds on or before 12:00 a.m., midnight, New
York time, on such business day.
After receiving notice from the Administrative Agent
that a Default has occurred and is continuing, the Concentration
Bank shall immediately and from time to time thereafter (unless
it receives notice from the Administrative Agent to the contrary)
transfer all funds held in its Concentration Account to the
Administrative Agent for deposit in an Assignee Deposit Account
and shall notify the Administrative Agent and the Company by
facsimile transmission as to the details of each such transfer.
Each Debtor will use all reasonable efforts to cause
each Account Debtor, Receiving Bank, Disbursement Bank and
Concentration Bank to comply with the foregoing procedures and
instructions.
(b) The Administrative Agent shall be the holder of a
security interest in the Lockboxes (other than Lockboxes that are
zip codes maintained for the exclusive use of a Debtor by a
financial institution), the Lockbox Accounts, the Receiving
Accounts, the Concentration Account and the Disbursement
Accounts, and the Debtors shall identify or name all such
accounts in a manner sufficient or appropriate to reflect the
Administrative Agent as pledgee thereof; provided, however, that
to the extent that any applicable law requires the Administrative
Agent to be the owner of such accounts in order to establish a
valid, first and prior Lien for the benefit of the Administrative
Agent with respect to such accounts, then the Administrative
Agent shall be deemed the owner of such accounts and the Debtors
shall identify or name all such accounts in a manner sufficient
or appropriate to reflect the Administrative Agent as the owner
of such accounts. The Receiving Banks, Concentration Bank and the
Disbursement Banks shall be notified that the items and funds
deposited therein are property of the Debtors subject to the
security interest of the Administrative Agent.
(c) Except as set forth in the following sentence, (i)
not later than thirty (30) days after the Closing Date, as to all
Lockboxes (other than Lockboxes that are zip codes maintained for
the exclusive use of a Debtor by a financial institution),
Lockbox Accounts, Receiving Accounts, Concentration Accounts and
Disbursement Accounts identified on Schedule V, and (ii) prior to
establishing any such lockboxes or accounts with any bank or
other financial institution after the Closing Date, the Debtors
will cause such bank or other financial institution to deliver a
writing to the Administrative Agent, in form and substance
satisfactory to the Administrative Agent, consenting to and
acknowledging the security interest of the Administrative Agent
in such lockboxes or accounts and all Cash Instruments from time
to time therein, and confirming that the bank or other financial
institution in question has established the relevant accounts and
procedures referred to in this Section and has received and
agreed to follow the instructions of the Administrative Agent
with respect to all such Cash Instruments following the
occurrence of any Event of Default or Unmatured Event of Default
of the type
14
specified in Section 9.1(f) or (g) of the Credit Agreement and
waiving all rights of setoff and banker's lien on all items held
in any such lockbox or account. With respect to each of the
Company's accounts at Xxxxx Fargo Bank, Mellon Bank East and The
Northern Trust Company which are listed on Schedule V, the
Company shall have one hundred and twenty (120) days after the
Closing Date (i) to obtain an agreement from the related bank
covering such account and satisfying the requirements of the
prior sentence or (ii) to close such account, and, with respect
to each of the accounts held at First State Bank Xxxx Xxxxxxx and
listed on Schedule V, the Company shall not be obligated to
obtain an agreement from such bank covering such account and
satisfying the requirements of the prior sentence so long as the
amount in such account is less than $5,000; provided, however,
that notwithstanding the foregoing, upon the occurrence of an
Event of Default or Unmatured Event of Default or at the request
of the Administrative Agent, the Company shall have thirty (30)
days to obtain an agreement covering each of the accounts
referred to in this sentence and satisfying the requirements of
the prior sentence. The Company may, from time to time after the
Closing Date, designate a bank or other financial institution to
act as a Concentration Bank, Receiving Bank or a Disbursement
Bank and such bank or other financial institution shall become a
Concentration Bank, Receiving Bank or a Disbursement Bank for
purposes of this Agreement; provided that (i) such bank is
located in the United States, (ii) such bank or other financial
institution has delivered a writing to the Administrative Agent
confirming the matters set forth in the first sentence of this
clause (c), (iii) the Company has delivered to the Administrative
Agent an amended Schedule V, setting forth the then-current list
of Concentration Banks, Receiving Banks and Disbursement Banks,
and (iv) with respect to the designation of a Concentration Bank,
the Administrative Agent and the Required Lenders must approve
such designation.
(d) Each of the Debtors agrees that it and its
Domestic Subsidiaries will not maintain any deposit or similar
accounts with any other financial institution other than the
accounts specifically described in clauses (a) through (c) above
without the prior written consent of the Administrative Agent and
the Required Lenders.
8. Default. Whenever a Default shall have occurred and
be continuing, the Administrative Agent may exercise from time to
time any right or remedy available to it under applicable law.
Each Debtor agrees, in case of the occurrence and during the
continuance of a Default, (i) to assemble, at its expense, all
its Inventory and other Goods (other than Fixtures) at a
convenient place or places reasonably acceptable to the
Administrative Agent, and (ii) at the Administrative Agent's
request, to execute all such documents and do all such other
things which may be necessary or desirable in order to enable the
Administrative Agent or its nominee to be registered as owner of
the Intellectual Property with any and all competent registration
authority. Any notification of intended disposition of any of the
Collateral required by law shall be deemed reasonably and
properly given if given at least ten days before such
disposition. Any proceeds of any disposition by the
Administrative Agent of any of the Collateral may be applied by
the Administrative Agent to payment of reasonable, documented and
out-of-pocket expenses in connection with the Collateral,
including without limitation Attorney Costs, and any balance of
such proceeds may be applied by the Administrative Agent toward
the payment of such of the Liabilities, and in such order of
application, as the Administrative Agent may from time to time
elect.
15
9. General. Each Debtor hereby irrevocably appoints the
Administrative Agent, its attorney-in-fact, with full authority
in the place and stead of such Debtor and in the name of such
Debtor or otherwise, from time to time in the Administrative
Agent's discretion, to take any action and to execute any
instrument which the Administrative Agent may deem necessary or
advisable to accomplish the purposes of this Agreement,
including, without limitation: (a) upon the occurrence of, and
during the continuation of, a Default, to ask, demand, collect,
xxx for, recover, compromise, receive and give acquittance and
receipts for moneys due and to become due under or in respect of
any of the Collateral; (b) upon the occurrence of, and during the
continuation of, a Default, to receive, endorse, and collect any
drafts or other instruments, documents and chattel paper, in
connection with clause (a) above; (c) upon the occurrence of, and
during the continuation of, a Default, to file any claims or take
any action or institute any proceedings which the Administrative
Agent may deem necessary or desirable for the collection of any
of the Collateral or otherwise to enforce the rights of the
Administrative Agent with respect to any of the Collateral; and
(d) upon the occurrence of, and during the continuation of, a
Default, to perform the affirmative obligations of the Debtor
hereunder. Each Debtor hereby acknowledges, consents and agrees
that the power of attorney granted pursuant to this Section is
irrevocable and coupled with an interest. If any Debtor fails to
perform any agreement contained herein, the Administrative Agent
may itself perform, or cause performance of, such agreement, and
the expenses of the Administrative Agent incurred in connection
therewith shall be payable by the Debtors. The powers conferred
on the Administrative Agent hereunder are solely to protect its
interest (on behalf of the Lender Parties) in the Collateral and
shall not impose any duty on it to exercise any such powers.
Except for reasonable care of any Collateral in its possession
and the accounting for moneys actually received by it hereunder,
the Administrative Agent shall have no duty as to any Collateral
or as to the taking of any necessary steps to preserve rights
against prior parties or any other rights pertaining to any
Collateral. The Administrative Agent is required to exercise
reasonable care in the custody and preservation of any of the
Collateral in its possession. If at any time any Debtor requests
in writing that the Administrative Agent take any action with
respect to any of the Collateral, the Administrative Agent shall
be deemed to have exercised reasonable care with respect to such
Collateral if it takes such action; provided, however, that any
failure of the Administrative Agent to comply with any such
request at any time shall not in itself be deemed a failure to
exercise reasonable care.
All notices, requests and other communications
hereunder shall be given in the manners and to the addresses set
forth in Section 11.2 of the Credit Agreement, and shall be
effective as set forth therein if given in any such manner.
Each of the Debtors agrees to pay all reasonable
expenses (including without limitation Attorney Costs) paid or
incurred by the Administrative Agent or any Lender Party in
endeavoring to collect the Liabilities of such Debtor, or any
part thereof, and in enforcing this Agreement against such
Debtor, and such obligations will themselves be Liabilities.
No delay on the part of the Administrative Agent in
the exercise of any right or remedy shall operate as a waiver
thereof, and no single or partial exercise by the Administrative
16
Agent of any right or remedy shall preclude other or further
exercise thereof or the exercise of any other right or remedy.
This Agreement shall remain in full force and effect
until the payment in full of all the Liabilities (other than
Liabilities in the nature of contingent continuing
indemnification obligations), the expiration or termination of
all Letters of Credit and Permitted Swap Obligations (monetary or
otherwise) of the Company under any Swap Contract with a Lender
Party (other than Swap Contracts that, by their terms, are
unsecured) and the termination of all the Commitments under the
Loan Documents. If at any time all or any part of any payment
theretofore applied by the Administrative Agent or any Lender
Party to any of the Liabilities is or must be rescinded or
returned by the Administrative Agent or such Lender Party for any
reason whatsoever (including without limitation the insolvency,
bankruptcy or reorganization of any Debtor or any other Obligor),
such Liabilities shall, for the purposes of this Agreement, to
the extent that such payment is or must be rescinded or returned,
be deemed to have continued in existence, notwithstanding such
application by the Administrative Agent or such Lender Party, and
this Agreement shall continue to be effective or be reinstated,
as the case may be, as to such Liabilities, all as though such
application by the Administrative Agent or such Lender Party had
not been made.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK,
EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE
SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF
ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK. Whenever possible,
each
provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any
provision of this Agreement shall be prohibited by or invalid
under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating
the remainder of such provision or the remaining provisions of
this Agreement.
The rights and privileges of the Administrative Agent
hereunder shall inure to the benefit of its successors and
assigns.
This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate
counterparts, and each such counterpart shall be deemed to be an
original, but all such counterparts shall together constitute one
and the same Agreement. At any time after the date of this
Agreement, one or more additional Persons may become parties
hereto by executing and delivering to the Administrative Agent a
counterpart of this Agreement. Immediately upon such execution
and delivery (and without any further action), each such
additional Person will become a party to, and will be bound by
all the terms of, this Agreement.
ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS
OF THE XXXXX XX XXX XXXX XX XX XXX XXXXXX XXXXXX FOR THE
00
XXXXXXXX XXXXXXXX XX XXX XXXX, AND BY EXECUTION AND DELIVERY OF
THIS AGREEMENT, EACH OF THE DEBTORS, AND BY ACCEPTING THE
BENEFITS HEREOF, THE ADMINISTRATIVE AGENT AND EACH LENDER PARTY,
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF SUCH COURTS; PROVIDED, HOWEVER,
THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER
PROPERTY MAY BE BROUGHT, AT THE ADMINISTRATIVE AGENT'S OPTION, IN
THE COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER
PROPERTY MAY BE FOUND. EACH OF THE DEBTORS, THE ADMINISTRATIVE
AGENT AND EACH LENDER PARTY IRREVOCABLY WAIVES ANY OBJECTION,
INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED
HERETO. THE DEBTORS, THE ADMINISTRATIVE AGENT AND EACH LENDER
PARTY EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR
OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY
NEW YORK LAW.
EACH OF THE DEBTORS, AND (BY ACCEPTING THE BENEFITS
HEREOF) EACH OF THE ADMINISTRATIVE AGENT AND EACH LENDER PARTY,
EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED
TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR
OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES
AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT
OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT
CLAIMS, OR OTHERWISE. THE DEBTORS, THE ADMINISTRATIVE AGENT AND
THE LENDER PARTIES EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF
ACTION SHALL BE TRIED BY A COURT WITHOUT A JURY. WITHOUT LIMITING
THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE
RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION
AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS,
IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY
OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION
HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENT, RENEWAL, SUPPLEMENT OR MODIFICATION TO THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS.
THIS WRITTEN SECURITY AGREEMENT, THE CREDIT
AGREEMENT, THE NOTES, THE OTHER LOAN DOCUMENTS, AND THE
INSTRUMENTS AND DOCUMENTS EXECUTED IN CONNECTION HEREWITH,
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT
18
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS.
10. Limit on Collateral. Notwithstanding the
foregoing, "Collateral" shall not include any General Intangibles
or other rights arising under contracts as to which the grant of
a security interest would constitute a violation of a valid and
enforceable restriction on such grant, unless and until any
required consents shall have been obtained, but shall include all
proceeds of any such contracts (each Debtor agrees to use its
best efforts to obtain any such required consent).
11. Release of Security Interest. Upon the payment in
full of all the Liabilities (other than Liabilities in the nature
of contingent continuing indemnification obligations), the
expiration or termination of all the Letters of Credit and
Permitted Swap Obligations (monetary or otherwise) of the Company
under any Swap Contract with a Lender Party (other than Swap
Contracts that, by their terms, are unsecured) and the
termination of all the Commitments under the Loan Documents, the
security interest granted herein shall terminate and all rights
to the Collateral shall revert to the applicable Debtor. Upon any
such termination, the Administrative Agent will, at the
applicable Debtor's sole expense and reasonable request, promptly
return to such Debtor all certificates and instruments then in
its possession representing and evidencing all pledged shares,
notes or securities pledged hereunder, together with all
Collateral held by the Administrative Agent hereunder, and
execute and deliver to such Debtor such releases and documents,
in each case without recourse, representations or warranties of
any kind, as such Debtor shall reasonably request to evidence
such termination. Upon the occurrence of a permitted disposition
of any Collateral pursuant to Section 8.2 of the Credit Agreement
and receipt by the Administrative Agent of all payments required
to be made under the Credit Agreement on account of such
permitted disposition and so long as no Default or Event of
Default shall have occurred and be continuing, the security
interest granted herein with respect to the Collateral which was
the subject of such permitted disposition shall terminate and the
Administrative Agent will, upon the applicable Debtor's
reasonable request and at such Debtor's sole expense, promptly
take such actions as are reasonably necessary to provide a
release, without recourse, representations or warranties of any
kind, of its security interest in such Collateral.
12. Conflicting Provisions. To the extent that any
provisions of this Agreement conflict with any provisions of the
Credit Agreement, the provisions of the Credit Agreement shall
control.
19
IN WITNESS WHEREOF, this Agreement has been duly
executed as of the day and year first above written.
THE DEBTORS
DEL MONTE CORPORATION
By: /s/ Xxx X. Xxxxxx
Title: Assistant Treasurer
DEL MONTE FOODS COMPANY
By: /s/ Xxx X. Xxxxxx
Title: Assistant Treasurer
THE ADMINISTRATIVE AGENT
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as
Administrative Agent for the Lender Parties
By: /s/ Xxxx X. Xxxxxxxx
Title: Managing Director
S-1
