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EXHIBIT 10.4
AMENDED AND RESTATED
SECURITY AGREEMENT
dated as of
June 30, 1992
and amended and restated
as of August 5, 1997
among
ORBITAL SCIENCES CORPORATION,
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as Collateral Agent
and
NATIONSBANK, N.A.,
as Designated Lockbox Bank
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AMENDED AND RESTATED SECURITY AGREEMENT
AMENDED AND RESTATED SECURITY AGREEMENT dated as of June 30, 1992 and
amended and restated as of August 5, 1997 among ORBITAL SCIENCES CORPORATION
(with its successors, the "DEBTOR"), XXXXXX GUARANTY TRUST COMPANY OF NEW YORK
(as successor by merger to X.X. Xxxxxx Delaware), as Collateral Agent (with its
successors, the "COLLATERAL AGENT") and NATIONSBANK, N.A., as Designated Lockbox
Bank.
W I T N E S S E T H :
WHEREAS, the Debtor and certain of its wholly-owned subsidiaries, certain
banks (with their respective successors and assigns, the "BANKS"), Xxxxxx
Guaranty Trust Company of New York, as administrative agent (the "ADMINISTRATIVE
AGENT") and X.X. Xxxxxx Delaware, as collateral agent (the "ORIGINAL COLLATERAL
AGENT") have entered into a Credit and Reimbursement Agreement dated as of June
30, 1992 (as amended from time to time prior to the Effective Date (as defined
in the Credit Agreement referred to below), including without limitation by the
Amended and Restated Credit Agreement dated as of September 27, 1994 among the
Debtor and such wholly-owned subsidiaries, the Banks, the Administrative Agent
and the Original Collateral Agent, the "ORIGINAL CREDIT AGREEMENT"); and
WHEREAS, pursuant to a Security Agreement dated as of June 30, 1992
between the Debtor and the Original Collateral Agent (as amended from time to
time prior to the Effective Date, the "ORIGINAL COMPANY SECURITY AGREEMENT"),
the obligations of the Debtor under the Financing Documents (as defined in the
Original Credit Agreement) are secured by Liens (as so defined) on the
Collateral (as so defined); and
WHEREAS, the Original Collateral Agent has merged with and into Xxxxxx
Guaranty Trust Company of New York, and Xxxxxx Guaranty Trust Company of New
York as the survivor to such merger has assumed all of the obligations of the
Original Collateral Agent (Xxxxxx Guaranty Trust Company of New York in its
capacity as successor by merger to the Original Collateral Agent, the
"COLLATERAL AGENT"); and
WHEREAS, the Debtor and the Banks wish to restructure the obligations of
the Debtor under the Financing Documents; and
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WHEREAS, in order to effect such restructuring, the Debtor, Magellan
Corporation, a subsidiary of the Debtor, the Banks, the Administrative Agent and
the Collateral Agent have entered into a Second Amended and Restated Credit
Agreement dated as of August 5, 1997 (the "SECOND AMENDED CREDIT AGREEMENT")
pursuant to which the Original Credit Agreement has been amended and restated in
its entirety as set forth therein (the Original Credit Agreement, as amended and
restated by the Second Amended Credit Agreement and as the same may be further
amended or amended and restated from time to time, the "CREDIT AGREEMENT");
WHEREAS, it is a condition to the effectiveness of the Second Amended
Credit Agreement that the Debtor and the Collateral Agent enter into an Amended
and Restated Company Security Agreement substantially in the form hereof;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Original Company Security Agreement is amended and restated in
its entirety as follows:
SECTION 1. Definitions.
Terms defined in the Credit Agreement and not otherwise defined herein
have, as used herein, the respective meanings provided for therein. The
following additional terms, as used herein, have the following respective
meanings:
"ANCILLARY RIGHTS" means rights incidental or ancillary to the Receivables
and the administration, servicing and collection thereof, including, without
limitation, all collateral security and guarantees of any kind (including
without limitation letters of credit or other forms of credit enhancement) given
by any Person to the Debtor with respect to any Receivable.
"COLLATERAL" has the meaning set forth in Section 3.
"COLLATERAL ACCOUNT" has the meaning set forth in Section 6.
"DESIGNATED LOCKBOX BANK" means NationsBank, N.A.
"INSURANCE ACCOUNT" has the meaning set forth in Section 7.
"INSURANCE PAYMENTS" means all proceeds payable to the Collateral Agent as
loss payee under, or unearned premiums with respect to, the Insurance Policies.
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"INSURANCE POLICIES" means the insurance policies evidencing the insurance
the Debtor is maintaining at any time pursuant to Section 5.03 of the Credit
Agreement other than any such policy solely with respect to equipment.
"LETTER OF CREDIT OBLIGATION" means at any time any Reimbursement
Obligations of the Debtor or other obligation of the Debtor to make a payment in
connection with a Letter of Credit issued for the account of the Debtor,
including contingent obligations with respect to amounts which are then, or may
thereafter become, available for drawing under Letters of Credit issued for the
account of the Debtor then outstanding.
"LIQUID INVESTMENTS" means Temporary Cash Investments; provided that (i)
each Liquid Investment shall mature within 30 days after it is acquired by the
Collateral Agent and (ii) in order to provide the Collateral Agent, for the
benefit of the Secured Parties, with a perfected security interest therein, each
Liquid Investment shall be either:
(i) evidenced by negotiable certificates or instruments, or if
non-negotiable then issued in the name of the Debtor, which (together with
any appropriate instruments of transfer) are delivered to, and held by,
the Collateral Agent or an agent thereof (which shall not be the Debtor or
any of its Affiliates) in the State of New York; or
(ii) in book-entry form and issued by the United States and subject
to pledge under applicable state law and Treasury regulations and as to
which (in the reasonable opinion of counsel to the Collateral Agent)
appropriate measures shall have been taken for perfection of the Security
Interests.
"PERFECTION CERTIFICATE" means the certificate, substantially in the form
of Exhibit A, completed and supplemented with the schedules and attachments
contemplated thereby to the satisfaction of the Collateral Agent, and duly
executed by the Debtor.
"PROCEEDS" means all proceeds of, and all other profits, rentals or
receipts, in whatever form, arising from the collection, sale, lease, exchange,
assignment, licensing or other disposition of, or realization upon, Collateral,
including without limitation all claims of the Debtor against third parties for
loss of, damage to or destruction of, or for proceeds payable under, or unearned
premiums with respect to, policies of insurance in respect of, any Collateral,
rights to any returned or repossessed goods relating to any Collateral, and any
condemnation or requisition payments with respect to any Collateral, in each
case whether now existing or hereafter arising.
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"RECORDS" means all right, title or interest of Debtor in and to all
documents, books, records and other information (including without limitation
computer programs, tapes, discs, punch cards, data processing software and
related property and rights) maintained with respect to Receivables.
"RECEIVABLES" means all "ACCOUNTS" (as defined in the UCC) now owned or
hereafter acquired by the Debtor, and shall also mean and include all accounts
receivable, contract rights, book debts, chattel paper, notes, drafts and other
obligations or indebtedness owing to the Debtor arising from the sale, lease or
exchange of goods or other property by it and/or performance of services by it
(including, without limitation, any such obligation which might be characterized
as an account, contract right or general intangible under the Uniform Commercial
Code in effect in any jurisdiction) and all of the Debtor's right in, to and
under all purchase orders for goods, services or other property to be provided
or sold by it or any Affiliate, and all monies due to or to become due to the
Debtor under all contracts for the sale (as seller), lease (as lessor) or
exchange of goods or other property and/or performance of services by it
(whether or not yet earned by performance on the part of the Debtor), in each
case whether now in existence or hereafter arising or acquired including,
without limitation, the right to receive the proceeds of said purchase orders
and contracts and all collateral security and guarantees of any kind given by
any Person with respect to any of the foregoing.
"SECURED OBLIGATIONS" means the obligations secured under this Agreement
including (a) all principal of and interest (including, without limitation, any
interest which accrues after the commencement of any case, proceeding or other
action relating to the bankruptcy, insolvency or reorganization of the Debtor,
whether or not allowed or allowable as a claim in any such proceeding) on any
loan to the Debtor under, or any note issued by the Debtor pursuant to, the
Credit Agreement, (b) all other amounts payable by the Debtor hereunder or under
the Credit Agreement (including without limitation any Reimbursement
Obligations) and (c) any renewals or extensions of any of the foregoing.
"SECURED PARTIES" means each of the Banks and the Agents.
"SECURITY EVENT" means any event, occurrence or condition which, in the
sole discretion of the Required Banks acting in good faith, "impairs the
prospect of payment" by the Debtor within the meaning of Section 1-208 of the
UCC.
"SECURITY INTERESTS" means the security interests in the Collateral
granted hereunder securing the Secured Obligations.
"UCC" means the Uniform Commercial Code as in effect on the date hereof in
the State of New York; provided that if by reason of mandatory
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provisions of law, the perfection or the effect of perfection or non-perfection
of the Security Interest in any Collateral is governed by the Uniform Commercial
Code as in effect in a jurisdiction other than New York, "UCC" means the Uniform
Commercial Code as in effect in such other jurisdiction for purposes of the
provisions hereof relating to such perfection or effect of perfection or
non-perfection.
SECTION 2. Representations and Warranties.
The Debtor represents and warrants as follows:
(A) The Debtor has good title to all of the Collateral, free and clear of
any Liens other than the Permitted Liens. The Debtor has taken all actions
necessary under the UCC to perfect its interest in any Receivables purchased or
otherwise acquired by it, as against its assignors and creditors of its
assignors.
(B) Other than financing statements, mortgages, security agreements or
other similar or equivalent documents or instruments with respect to the
Security Interests and the Permitted Liens, no financing statement, mortgage,
security agreement or similar or equivalent document or instrument covering all
or any part of the Collateral is on file or of record in any jurisdiction in
which such filing or recording would be effective to perfect a Lien on such
Collateral. No Collateral is in the possession of any Person (other than the
Debtor) asserting any claim thereto or security interest therein, except that
the Collateral Agent or its designee may have possession of Collateral as
contemplated hereby.
(C) On the Effective Date, the Debtor shall deliver the Perfection
Certificate to the Collateral Agent. The information set forth therein shall be
correct and complete in all material respects. Promptly after the Effective
Date, the Debtor shall furnish to the Collateral Agent acknowledgment copies of
the filings set forth in Schedule 7 to the Perfection Certificate.
(D) The Security Interests constitute valid security interests under the
UCC securing the Secured Obligations to the extent the UCC is applicable
thereto. The Security Interests constitute perfected security interests in the
Collateral to the extent that a security interest therein may be perfected by
filing pursuant to the UCC, subject to no Liens except for the Permitted Liens
and prior to all Liens except for the Permitted Liens (other than the Security
Interests) existing on and as of the Effective Date.
(E) Upon the delivery to the Collateral Agent of assignments and notices of
assignment substantially in the forms of Exhibits G-2 and G-3, respectively, to
the Credit Agreement with respect thereto, and the filing of each such notice
with the governmental authority or agency or other office described therein, the
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Security Interests shall constitute valid assignments of the Receivables due
under Eligible Government Contracts to the extent that such assignment is
governed by the Assignment of Claims Act.
(F) No Person other than the Collateral Agent has been named as a loss
payee on any of the Insurance Policies, except as permitted in the proviso
contained in Section 5.03(e) of the Credit Agreement. No consent of any Person
is required in connection with the pledge of the Insurance Policies hereunder.
SECTION 3. The Security Interests.
(A) In order to secure the full and punctual payment of the Secured
Obligations in accordance with the terms thereof, and to secure the performance
of all of the obligations of the Debtor hereunder and under the other Financing
Documents, the Debtor hereby grants to the Collateral Agent for the ratable
benefit of the Secured Parties, a continuing security interest in and to all of
the following property of the Debtor, whether now owned or existing or hereafter
acquired or arising and regardless of where located (all being collectively
referred to as the "COLLATERAL"):
(1) Receivables;
(2) Ancillary Rights;
(3) Records;
(4) Insurance Payments;
(5) Insurance Policies;
(6) The Collateral Account, all cash deposited therein from time to
time, the Liquid Investments made pursuant to Section 6(D) and other
monies and property of any kind of the Debtor in the possession or under
the control of the Collateral Agent;
(7) The Insurance Account, all cash deposited therein from time to
time, and the Liquid Investments made pursuant to Section 7(C); and
(8) All Proceeds of all or any of the Collateral described in clauses
1 through 7 hereof.
(B) The Security Interests are granted as security only and shall not
subject the Collateral Agent or any other Secured Party to, or transfer or in
any
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way affect or modify, any obligation or liability of the Debtor with respect
to any of the Collateral or any transaction in connection therewith.
SECTION 4. Further Assurances; Covenants.
(A) The Debtor will not change its name, identity or corporate structure in
any manner or change the location of (i) its chief executive office or chief
place of business, or (ii) the locations where it keeps or holds any Collateral
from the applicable location described in the Perfection Certificate unless it
shall have given the Collateral Agent thirty (30) days prior notice thereof,
shall have taken all such action as the Collateral Agent shall reasonably deem
necessary to maintain at all times the perfection of the Security Interests in
the Collateral granted hereunder and shall have delivered an opinion of counsel
with respect thereto in accordance with Section 4(I).
(B) The Debtor will, from time to time, at its expense, execute, deliver,
file and record any statement, notice, assignment, instrument, document,
agreement or other paper and take any other action, (including, without
limitation, any filings of financing or continuation statements under the UCC,
or any such document or action in respect of the Assignment of Claims Act) that
from time to time may be necessary or desirable, or that the Collateral Agent
may reasonably request, in order to create, preserve, perfect, confirm or
validate the Security Interests or to enable the Collateral Agent and the
Secured Parties to obtain the full benefits of this Agreement, or to enable the
Collateral Agent to exercise and enforce any of its rights, powers and remedies
hereunder with respect to any of the Collateral. To the extent permitted by
applicable law, the Debtor hereby authorizes the Collateral Agent to execute and
file financing statements or continuation statements without the Debtor's
signature appearing thereon. The Debtor agrees that a carbon, photographic,
photostatic or other reproduction of this Agreement or of a financing statement
is sufficient as a financing statement. The Debtor shall pay the costs of, or
incidental to, any recording or filing of any financing or continuation
statements concerning the Collateral.
(C) The Debtor will maintain its qualification to do business and all
necessary licenses, permits and other governmental authorizations necessary in
any jurisdiction to enable the Debtor to perform its obligations in respect of
the Receivables and to administer, service and collect the Receivables.
(D) The Debtor will not, without the consent of the Required Banks, change
its credit or collection policies in a manner that is reasonably likely to
impair the collectibility of the Receivables.
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(E) The Debtor will keep full and accurate books and records relating to
the Collateral, and stamp or otherwise xxxx such books and records in such
manner as the Required Banks may reasonably require in order to reflect the
Security Interests.
(F) The Debtor shall use all commercially reasonable efforts to cause to be
collected from its account debtors, as and when due, any and all amounts owing
under or on account of each Receivable (including, without limitation,
Receivables which are delinquent, such Receivables to be collected in accordance
with lawful collection procedures) and shall apply forthwith upon receipt
thereof all such amounts as are so collected to the outstanding balance of such
Receivables. Subject to the rights of the Collateral Agent and the Secured
Parties hereunder if an Event of Default shall have occurred and be continuing,
the Debtor may allow in the ordinary course of business as adjustments to
amounts owing under the Receivables (i) an extension or renewal of the time or
times of payment, or settlement for less than the total unpaid balance and (ii)
a refund, credit or other adjustment due as a result of returned, damaged, or
non-conforming merchandise, products or services, all in accordance with the
Debtor's sound business judgment. The costs and expenses (including, without
limitation, reasonable attorney's fees) of collection, whether incurred by the
Debtor or the Collateral Agent, shall be borne by the Debtor.
(G) Without the prior written consent of the Required Banks, the Debtor
will not sell, lease, exchange, assign or otherwise dispose of, or grant any
option with respect to, any Collateral except that, subject to the rights of the
Agents and the Banks hereunder if an Event of Default shall have occurred and be
continuing, the Debtor may dispose of Collateral as permitted by the terms of
the Credit Agreement.
(H) The Debtor will, promptly upon request, provide to the Collateral Agent
all information and evidence it may reasonably request concerning the Collateral
to enable the Collateral Agent to enforce the provisions of this Agreement.
(I) Not more than six months nor less than 30 days prior to each date on
which the Debtor proposes to take any action in connection with which an opinion
of counsel is to be delivered pursuant to Section 4(A), the Debtor shall, at its
cost and expense, cause to be delivered to the Secured Parties an opinion of
counsel, reasonably satisfactory to the Collateral Agent, substantially in the
form of Exhibit C to the effect that all financing statements and amendments or
supplements thereto, continuation statements and other documents required to be
recorded or filed in order to continue the perfection of the Security Interests
against all following the proposed action by the Debtor have been filed in each
filing office
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necessary for such purpose and that all filing fees and taxes, if any, payable
in connection with such filings have been paid in full.
SECTION 5. [Reserved].
SECTION 6. Collateral Account.
(A) There is hereby established with the Collateral Agent a cash collateral
account for the Debtor (the "COLLATERAL ACCOUNT") in the name and under the
control of the Collateral Agent into which there shall be deposited from time to
time (i) the cash proceeds of the Collateral (other than any cash proceeds of
the Insurance Payments or the Insurance Policies) required to be delivered to
the Collateral Agent pursuant to subsection (B) of this Section 6 or any other
provision of this Agreement and (ii) the Borrower LC Amount received by the
Administrative Agent pursuant to Section 6.01 of the Credit Agreement. Any
income received by the Collateral Agent with respect to the balance from time to
time standing to the credit of the Collateral Account, including any interest or
capital gains on Liquid Investments, shall remain, or be deposited, in the
Collateral Account. The cash amounts on deposit from time to time in the
Collateral Account together with any Liquid Investments from time to time made
pursuant to subsection (D) of this Section shall constitute part of the
Collateral hereunder and shall not constitute payment of the Secured Obligations
until applied thereto as hereinafter provided.
(B) The Debtor shall instruct all Obligors to make all payments in respect
of the Eligible Receivables either (i) directly to the Collateral Agent (by
instructing that such payments be remitted to a post office box which shall be
in the name and under the control of the Collateral Agent) or (ii) to one or
more other banks in any state in the United States (by instructing that such
payments be remitted to a post office box which shall be in the name and under
the control of such bank) under a Lockbox Letter substantially in the form of
Exhibit B hereto duly executed by the Debtor and such bank or under other
arrangements, in form and substance reasonably satisfactory to the Collateral
Agent, pursuant to which the Debtor shall have irrevocably instructed such other
bank (and such other bank shall have agreed) to remit all proceeds of such
payments directly to the Collateral Agent for deposit into the Collateral
Account or as the Collateral Agent may otherwise instruct such bank. All such
payments made to the Collateral Agent shall be deposited in the Collateral
Account. In addition to the foregoing, the Debtor agrees that if the Proceeds of
any Collateral hereunder (including the payments made in respect of Receivables)
shall be received by it, the Borrower shall as promptly as possible deposit such
Proceeds into the Collateral Account. Until so deposited, all such Proceeds
shall be held in trust by the Debtor for the
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Collateral Agent and the other Secured Parties and shall not be commingled with
any other funds or property of the Debtor.
(C) The balance from time to time standing to the credit of the Collateral
Account shall, except upon the occurrence and continuation of a Security Event
or an Event of Default, be distributed to the Debtor upon the order of the
Debtor. If immediately available cash on deposit in the Collateral Account is
not sufficient to make any distribution to the Debtor referred to in the
previous sentence of this Section 6(C), the Collateral Agent shall liquidate as
promptly as practicable Liquid Investments as required to obtain sufficient cash
to make such distribution and, notwithstanding any other provision of this
Section 6, such distribution shall not be made until such liquidation has taken
place. Upon the occurrence and continuation of an Event of Default, the
Collateral Agent shall, if so instructed by the Required Banks, apply or cause
to be applied (subject to collection) any or all of the balance from time to
time standing to the credit of the Collateral Account in the manner specified in
Section 11.
(D) Amounts on deposit in the Collateral Account aggregating $1,000,000 or
more shall be invested and re-invested from time to time in such Liquid
Investments as the Debtor shall determine, which Liquid Investments shall be
under the control of the Collateral Agent, provided that, if an Event of Default
has occurred and is continuing, the Collateral Agent shall, if instructed by the
Required Banks, liquidate any such Liquid Investment and apply or cause to be
applied the proceeds thereof to the payment of the Secured Obligations in the
manner specified in Section 11.
SECTION 7. Insurance Accounts.
(A) There is hereby established with the Collateral Agent a cash collateral
account for the Debtor (the "INSURANCE ACCOUNT") in the name and under the
control of the Collateral Agent into which there shall be deposited from time to
time any amounts received by the Collateral Agent pursuant to Section 5.03(c) of
the Credit Agreement. Insurance Payments not identified to a particular Borrower
by the payor shall be deposited in the Insurance Account of the Borrower
designated by the Company by notice to the Collateral Agent or, in the absence
of such notice, shall be deposited in the Insurance Account of the Company. Any
income received by the Collateral Agent with respect to the balance from time to
time standing to the credit of the Insurance Account, including any interest or
capital gains on Liquid Investments, shall remain, or be deposited, in the
Insurance Account. The cash amounts on deposit from time to time in the
Insurance Account together with any Liquid Investments from time to time made
pursuant to subsection (C) of this Section shall constitute part of the
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Collateral hereunder and shall not constitute payment of the Secured Obligations
until applied thereto as hereinafter provided.
(B) The balance from time to time standing to the credit of the Insurance
Account shall, except upon the occurrence and continuation of a Default, be
distributed to the Debtor upon the order of the Debtor. If immediately available
cash on deposit in the Insurance Account is not sufficient to make any
distribution to the Debtor referred to in the previous sentence of this Section
7(B), the Collateral Agent shall liquidate as promptly as practicable Liquid
Investments as required to obtain sufficient cash to make such distribution and,
notwithstanding any other provision of this Section 7, such distribution shall
not be made until such liquidation has taken place. Upon the occurrence and
continuation of an Event of Default, the Collateral Agent shall, if so
instructed by the Required Banks, apply or cause to be applied (subject to
collection) any or all of the balance from time to time standing to the credit
of the Insurance Account in the manner specified in Section 11.
(C) Amounts on deposit in the Insurance Account aggregating $1,000,000 or
more shall be invested and re-invested from time to time in such Liquid
Investments as the Debtor shall determine, which Liquid Investments shall be
under the control of the Collateral Agent, provided that, if an Event of Default
has occurred and is continuing, the Collateral Agent shall, if instructed by the
Required Banks, liquidate any such Liquid Investment and apply or cause to be
applied the proceeds thereof to the payment of the Secured Obligations in the
manner specified in Section 11.
SECTION 8. General Authority.
The Debtor hereby irrevocably appoints the Collateral Agent its true and
lawful attorney, with full power of substitution, in the name of the Debtor, the
Agents, any other Secured Parties or otherwise, for the sole use and benefit of
the Collateral Agent and the Secured Parties, but at the Debtor's expense, to
the extent permitted by law (including, without limitation, applicable laws,
rules, regulations and orders) to exercise, at any time and from time to time
while and only after an Event of Default has occurred and is continuing, all or
any of the following powers with respect to all or any of the Collateral:
(i) to demand, xxx for, collect, receive and give acquittance
for any and all monies due or to become due thereon or by virtue
thereof;
(ii) to settle, compromise, compound, prosecute or defend any
action or proceeding with respect thereto;
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(iii) to sell, transfer, assign or otherwise deal in or with
the same or the proceeds or avails thereof, as fully and effectually
as if the Collateral Agent were the absolute owner thereof; and
(iv) to extend the time of payment of any or all thereof and
to make any allowance and other adjustments with reference thereto;
provided that the Collateral Agent shall give the Debtor not less than ten days'
prior written notice of the time and place of any sale or other intended
disposition of any of the Collateral, except any Collateral which is perishable
or threatens to decline speedily in value or is of a type customarily sold on a
recognized market. The Debtor agrees that such notice constitutes "reasonable
notification" within the meaning of Section 9-504(3) of the UCC.
SECTION 9. Remedies upon Event of Default.
(A) If any Event of Default has occurred and is continuing, the Collateral
Agent may at the direction of the Required Banks, exercise on behalf of the
Secured Parties all rights of a secured party under the UCC (or, if the Uniform
Commercial Code is not in effect in the jurisdiction where such rights are
exercised, the UCC as in effect in the State of New York to the extent not
prohibited by the laws of such jurisdiction), and, in addition, the Collateral
Agent may, at the direction of the Required Banks, without being required to
give any notice, except as herein provided or as may be required by mandatory
provisions of law, (i) withdraw all cash and Liquid Investments in the
Collateral Account and the Insurance Account and apply such cash and Liquid
Investments and other cash, if any, then held by it as Collateral as specified
in Section 11 and (ii) if there shall be no such cash or Liquid Investments or
if such cash and Liquid Investments shall be insufficient to pay all the Secured
Obligations in full, sell the Collateral (subject to any applicable laws, rules,
regulations and orders) or any part thereof at public or private sale, for cash,
upon credit or for future delivery, and at such price or prices as the
Collateral Agent may reasonably deem satisfactory. The Collateral Agent or any
other Secured Party may be the purchaser of any or all of the Collateral
(subject to any applicable laws, rules, regulations and orders) so sold at any
public sale (or, if the Collateral is of a type customarily sold in a recognized
market or is of a type which is the subject of widely distributed standard price
quotations, at any private sale). The Debtor will execute and deliver such
documents and take such other action as the Collateral Agent reasonably deems
necessary or advisable in order that any such sale may be made in compliance
with law. Upon any such sale the Collateral Agent shall have the right to
deliver, assign and transfer to the purchaser thereof the Collateral so sold
(subject to any applicable laws, rules, regulations and orders). Each purchaser
at any such sale shall (subject to any applicable laws, rules, regulations
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and orders) hold the Collateral so sold to it absolutely and free from any claim
or right of whatsoever kind, including any equity or right of redemption of the
Debtor which may be waived, and the Debtor, to the extent permitted by law,
hereby specifically waives all rights of redemption, stay or appraisal which it
has or may have under any law now existing or hereafter adopted. The notice (if
any) of such sale required by Section 8 shall (1) in the case of a public sale,
state the time and place fixed for such sale, and (2) in the case of a private
sale, state the day after which such sale may be consummated. Any such public
sale shall be held at such time or times within ordinary business hours and at
such place or places as the Collateral Agent may fix in the notice of such sale.
At any such sale the Collateral may be sold in one lot as an entirety or in
separate parcels, as the Collateral Agent may determine. The Collateral Agent
shall not be obligated to make any such sale pursuant to any such notice. 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 same may be so adjourned. In case of any sale of all or
any part of the Collateral on credit or for future delivery, the Collateral so
sold may be retained by the Collateral Agent until the selling price is paid by
the purchaser thereof, but the Collateral Agent shall not incur any liability in
case of the failure of such purchaser to take up and pay for the Collateral so
sold and, in case of any such failure, such Collateral may again be sold upon
like notice. The Collateral Agent, instead of exercising the power of sale
herein conferred upon it (subject to any applicable laws, rules, regulations and
orders) may, at the direction of the Required Banks, proceed by a suit or suits
at law or in equity to foreclose the Security Interests and sell the Collateral,
or any portion thereof, under a judgment or decree of a court or courts of
competent jurisdiction.
(B) For the purpose of enforcing any and all rights and remedies under this
Agreement the Collateral Agent may (i) require the Debtor to, and the Debtor
agrees that it will, at its expense and upon the request of the Collateral
Agent, forthwith assemble all or any part of the Collateral as directed by the
Collateral Agent and make it available at a place reasonably designated by the
Collateral Agent which is, in its opinion, reasonably convenient to the
Collateral Agent and the Debtor, whether at the premises of the Debtor or
otherwise, (ii) to the extent permitted by applicable law, enter, with or
without process of law and without breach of the peace, any premise where any of
the Collateral is or may be located, and without charge or liability to it seize
and remove such Collateral from such premises, (iii) have access to and use the
Debtor's books and records relating to the Collateral and (iv) prior to the
disposition of the Collateral, store or transfer it without charge in or by
means of any storage or transportation facility owned or leased by the Debtor,
process, repair or recondition it or otherwise prepare it for disposition in any
reasonable manner and to the extent the Collateral Agent deems
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reasonable, appropriate and, in connection with such preparation and
disposition, use without charge any trademark, trade name, copyright, patent or
technical process used by the Debtor.
SECTION 10. Limitation on Duty of Collateral Agent in Respect of
Collateral.
Beyond the exercise of reasonable care in the custody thereof, the
Collateral Agent shall have no duty as to any Collateral in its possession or
control or in the possession or control of any agent or bailee or any income
thereon or as to the preservation of rights against prior parties or any other
rights pertaining thereto. The Collateral Agent shall be deemed to have
exercised reasonable care in the custody of the Collateral in its possession if
the Collateral is accorded treatment substantially equal to that which it
accords its own property, and shall not be liable or responsible for any loss or
damage to any of the Collateral, or for any diminution in the value thereof, by
reason of the act or omission of any warehouseman, carrier, forwarding agency,
consignee or other agent or bailee selected by the Collateral Agent in good
faith.
SECTION 11. Application of Proceeds.
Upon the occurrence and during the continuance of an Event of Default, the
proceeds of any sale of, or other realization upon, all or any part of the
Collateral and any cash held in the Collateral Account and Insurance Account
shall be applied by the Collateral Agent in the following order of priorities:
first, to payment of the expenses of such sale or other realization,
including reasonable compensation to agents and counsel for the Collateral
Agent, and all expenses, liabilities and advances incurred or made by the
Collateral Agent in connection therewith, and any other unreimbursed
expenses for which the Collateral Agent or any Bank is to be reimbursed
pursuant to the Credit Agreement, and unpaid fees owing to the Agents
under the Credit Agreement;
second, to the ratable payment of accrued but unpaid interest on the
Secured Obligations;
third, to the ratable payment of unpaid principal of Loans and,
subject to the second sentence of subsection (b), Letter of Credit
Obligations;
fourth, to the ratable payment of all other Secured Obligations,
until all Secured Obligations shall have been paid in full; and
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finally, to payment to the Debtor or its successors or assigns, or
as a court of competent jurisdiction may direct, of any surplus then
remaining from such proceeds.
(b) The Collateral Agent may make distributions hereunder in cash or in
kind or, on a ratable basis, in any combination thereof. If at any time any
monies collected or received by the Collateral Agent are distributable pursuant
to this Section in respect of a Letter of Credit Obligation which is a
contingent obligation at such time, then the Collateral Agent shall invest such
amounts in Liquid Investments selected by it and shall hold all such amounts so
distributable and all such Liquid Investments and the net proceeds thereof in
trust for application to the payment of such Letter of Credit Obligation at such
time as such Letter of Credit Obligation is no longer a contingent obligation.
If the Collateral Agent holds any amounts which were distributable in respect of
any Letter of Credit Obligations after all Letters of Credit have expired and
all amounts payable with respect thereto have been paid, such amounts shall be
applied in the order set forth in subsection (a) above.
(c) In making the determinations and allocations required by this Section,
the Collateral Agent shall have no liability to any of the Banks for actions
taken in reliance on information supplied by the Banks as to the amounts of the
Secured Obligations held by them. All distributions made by the Collateral Agent
pursuant to this Section shall be final, and the Collateral Agent shall have no
duty to inquire as to the application by the Banks of any amount distributed to
them. However, if at any time the Collateral Agent determines that an allocation
or distribution previously made pursuant to this Section was based on a mistake
of fact (including, without limiting the generality of the foregoing, mistakes
based on any assumption that principal or interest has been paid by payments
which are subsequently recovered from the recipient thereof through the
operation of any bankruptcy, reorganization, insolvency or other laws or
otherwise), the Collateral Agent may in its discretion, but shall not be
obligated to, adjust subsequent allocations and distributions hereunder so that,
on a cumulative basis, the Collateral Agent and the Banks receive the
distributions to which they would have been entitled if such mistake of fact had
not been made.
SECTION 12. Appointment of Co-agents.
At any time or times, in order to comply with any legal requirement in any
jurisdiction, the Collateral Agent may appoint another bank or trust company or
one or more other Persons, either to act as collateral co-agent or collateral
co-agents, jointly with the Collateral Agent, or to act as separate collateral
agent or collateral agents on behalf of the Secured Parties with such power and
authority
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as may be necessary for the effectual operation of the provisions hereof and may
be specified in the instrument of appointment (which may, in the discretion of
the Collateral Agent, include provisions for the protection of each such
collateral co-agent or separate collateral agent similar to the provisions of
Article 7 of the Credit Agreement).
SECTION 13. Designated Lockbox Bank. The Designated Lockbox Bank shall
have the rights and obligations of the Collateral Agent in respect of the
Collateral Account specified in Section 6 of this Agreement, provided that if an
Event of Default has occurred and is continuing, the Designated Lockbox Bank
shall exercise such rights and perform such obligations at the direction of the
Collateral Agent. In exercising such rights and performing such obligations the
Designated Lockbox Bank shall have the benefit of all privileges, immunities and
indemnities provided for the Collateral Agent under this Agreement including
without limitation the provisions of Section 14 hereof. The Designated Lockbox
Bank may resign as Designated Lockbox Bank in accordance with the provisions of
Section 7.08 of the Credit Agreement.
SECTION 14. Expenses.
The Debtor agrees that it will, on demand, pay to the Collateral Agent the
amount of any and all reasonable out-of-pocket expenses, including the
reasonable fees and disbursements of counsel and of any other experts, which the
Collateral Agent may incur in connection with (x) the administration or
enforcement of this Agreement, including such expenses as are incurred to
preserve the value of the Collateral and the validity, perfection, rank and
value of any Security Interest, (y) the collection, sale or other disposition of
any of the Collateral or (z) the exercise by the Collateral Agent of any of the
rights conferred upon it hereunder. The obligation to pay any such amount shall
be an additional Secured Obligation hereunder, and each such amount shall bear
interest from the time of demand at the rate applicable to Base Rate Loans.
SECTION 15. Termination of Security Interests; Release of Collateral.
Upon the repayment in full of all Secured Obligations, the termination of
the Commitments under the Credit Agreement and the cancellation or expiration of
all Letters of Credit, the Security Interests and all obligations of the Debtor
under this Agreement shall terminate and all rights to and interests in the
Collateral shall revert to the Debtor.
(b) Unless otherwise instructed by the Required Lenders at a time while an
Event of Default has occurred and is continuing, upon the consummation of any
Asset Sale permitted by the terms of the Credit Agreement, the Collateral Agent
shall release the Collateral (but not any Proceeds thereof) sold pursuant to
such
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Asset Sale. Any such release shall not require the consent of any Bank, and
the Collateral Agent shall be fully protected in relying on a certificate of the
Debtor as to whether an Event of Default has occurred and is continuing at any
relevant time or any particular Asset Sale is permitted by the terms of the
Credit Agreement.
(c) In addition to releases of Collateral permitted pursuant to subsection
(b), at any time and from time to time prior to such termination of the Security
Interests, the Collateral Agent may release any of the Collateral with the prior
written consent of the Required Banks; provided that the Collateral Agent may
release all or substantially all of the Collateral only with the prior written
consent of all of the Banks.
(d) Upon the termination of the Security Interests or any release of any
Collateral permitted by this Section, the Collateral Agent will promptly, at the
expense of the Debtor, execute and deliver to the Debtor such documents as the
Debtor shall reasonably request to evidence the termination of the Security
Interests or the release of such Collateral, as the case may be, including UCC
termination statements, and will duly assign, transfer and deliver to the Debtor
or to whomever lawfully shall be entitled to receive the same, such of the
Collateral as may be in the possession of the Collateral Agent.
SECTION 16. Notices.
All notices, communications and distributions to any party hereunder shall
be given in accordance with Section 10.01 of the Credit Agreement.
SECTION 17. Waivers, Non-Exclusive Remedies.
No failure on the part of the Collateral Agent to exercise, and no delay
in exercising and no course of dealing with respect to, any right under this
Agreement shall operate as a waiver thereof; nor shall any single or partial
exercise by the Collateral Agent of any right under this Agreement preclude any
other or further exercise thereof or the exercise of any other right. The rights
in the Financing Documents are cumulative and are not exclusive of any other
remedies provided by law.
SECTION 18. Successors and Assigns.
This Agreement is for the benefit of the Collateral Agent and the other
Secured Parties and their successors and assigns, and in the event of an
assignment of all or any of the Secured Obligations, the rights hereunder, to
the extent applicable to the indebtedness so assigned, may be transferred with
such indebtedness. This Agreement shall be binding on the Debtor and the
Collateral Agent and their respective successors and assigns.
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SECTION 19. Changes in Writing.
Neither this Agreement nor any provision hereof may be changed, waived,
discharged or terminated orally, but only in writing signed by the Debtor and
the Collateral Agent with the consent of the Required Banks (or in the case of
changes to Section 15 hereof, all of the Banks).
SECTION 20. New York Law.
This Agreement shall be construed in accordance with and governed by the
laws of the State of New York, except as otherwise required by mandatory
provisions of law and except to the extent that remedies provided by the laws of
any jurisdiction other than New York are governed by the laws of such
jurisdiction.
SECTION 21. Severability.
If any provision hereof is invalid or unenforceable in any jurisdiction,
then, to the fullest extent permitted by law, (i) the other provisions hereof
shall remain in full force and effect in such jurisdiction and shall be
liberally construed in favor of the Collateral Agent and the other Secured
Parties in order to carry out the intentions of the parties hereto as nearly as
may be possible; and (ii) the invalidity or unenforceability of any provision
hereof in any jurisdiction shall not affect the validity or enforceability of
such provision in any other jurisdiction.
SECTION 22. Counterparts.
This Agreement may be signed in any number of counterparts, each of which
shall be an original, with the same effect as if the signatures thereto and
hereto were upon the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
ORBITAL SCIENCES CORPORATION
By /s/ Xxxxxxx X. Sunshine
------------------------------------
Title: Vice President and Treasurer
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK, as Collateral Agent
By /s/ Xxxxx X. Xxxxxx
------------------------------------
Title: Vice President
NATIONSBANK N.A., as Designated
Lockbox Bank
By /s/ Xxxxx X. Xxxxxxxx
------------------------------------
Title: Vice President
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EXHIBIT A
PERFECTION CERTIFICATE
The undersigned, the [chief executive officer/chairman] and the chief
legal officer of ORBITAL SCIENCES CORPORATION, a Delaware corporation (the
"DEBTOR"), hereby certify with reference to the Amended and Restated Security
Agreement dated as of June 30, 1992 and amended and restated as of August 5,
1997 between the Debtor and Xxxxxx Guaranty Trust Company of New York, as
Collateral Agent (terms defined therein being used herein as therein defined),
to the Agents and each other Secured Party as follows:
1. Names. (a) The exact corporate name of the Debtor as of the date
hereof:
(b) Set forth below is each other corporate name the Debtor has had since
its organization, together with the period during which such name was used:
(c) Except as set forth in Schedule 1, the Debtor has not changed its
identity or corporate structure in any way within the past five years.
[Changes in identity or corporate structure would include mergers,
consolidations and acquisitions, as well as any change in the form, nature or
jurisdiction of corporate organization. If any such change has occurred, include
in Schedule 1 the information required by paragraphs 1, 2 and 3 of this
certificate as to each acquiree or constituent party to a merger or
consolidation.]
(d) The following is a list of all other names (including trade names or
similar appellations) used by the Debtor or any of its divisions or other
business units at any time during the past five years:
2. Current Locations. (a) The chief executive office of the Debtor is
located at the following address:
MAILING ADDRESS COUNTY STATE
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(b) The following are all the places of business of the Debtor not
identified above in the states identified above:
NAME MAILING ADDRESS COUNTY STATE
3. Prior Locations. (a) Set forth below is the information required by
subparagraphs (a), (b) and (c) of paragraph 2 with respect to each location or
place of business maintained by the Debtor (except as otherwise disclosed in
paragraph 2) at any time during the past five years:
4. Unusual Transactions. Except as set forth in Schedule 4, all
Receivables have been originated by the Debtor and all Equipment has been
acquired by the Debtor in the ordinary course of its business.
5. File Search Reports. Attached hereto as Schedule 5(A) is a true copy of
a file search report from the Debtor in each jurisdiction identified in
paragraph 2 or 3 above with respect to each name set forth in paragraph 1 above.
Attached hereto as Schedule 5(B) is a true copy of each financing statement or
other filing identified in such file search reports.
6. UCC Filings. A duly signed financing statement on Form UCC-1 in
substantially the form of Schedule 6(A) hereto has been duly filed in the
Uniform Commercial Code filing office in each jurisdiction identified in
paragraph 2 hereof.
7. Schedule of Filings. Attached hereto as Schedule 7 is a schedule
setting forth filing information with respect to the filings described in
paragraph 6 above.
8. Filing Fees. All filing fees and taxes payable in connection with the
filings described in paragraph 6 above have been paid.
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IN WITNESS WHEREOF, we have hereunto set our hands this day of August 5,
1997.
Name:
Title:
Name:
Title:
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SCHEDULE 6(A)
DESCRIPTION OF COLLATERAL
All of Debtor's right, title and interest in and to the following, whether
now owned or existing or hereafter acquired or arising and regardless of where
located: (i) All accounts; (ii) All accounts receivable, contract rights, book
debts, chattel paper, notes, drafts and other obligations or indebtedness owing
to the Debtor arising from the sale, lease or exchange of goods or other
property by it and/or performance of services by it (including, without
limitation, any such obligation which might be characterized as an account,
contract right or general intangible under the Uniform Commercial Code in effect
in any jurisdiction) and all of the Debtor's right in, to and under all purchase
orders for goods, services or other property to be provided or sold by it or any
affiliate, and all monies due to or to become due to the Debtor under all
contracts for the sale (as seller), lease (as lessor) or exchange of goods or
other property and/or performance of services by it (whether or not yet earned
by performance on the part of the Debtor), in each case whether now in existence
or hereafter arising or acquired including, without limitation, the right to
receive the proceeds of said purchase orders and contracts and all collateral
security and guarantees of any kind given by any person with respect to any of
the foregoing; (iii) All rights incidental or ancillary to any of the foregoing
and the administration, servicing and collection thereof, including, without
limitation, all collateral security and guarantees of any kind (including
without limitation letters of credit or other forms of credit enhancement) given
by any person to the Debtor with respect to any of the foregoing; (iv) All
documents, books, records and other information (including, without limitation,
computer programs, tapes, discs, punch cards, data processing software and
related property and rights) maintained with respect to any of the foregoing;
(v) All proceeds payable to the loss payee under, or unearned premiums with
respect to, any policy of insurance maintained by or on behalf of the Debtor
except any policy solely with respect to equipment; and (vi) All proceeds of,
and all other profits, rentals, or receipts, in whatever form, arising from the
collection, sale, lease, exchange, assignment, licensing or other disposition
of, or realization upon, any of the foregoing, including without limitation all
claims of the Debtor against third parties for loss of, damage to or destruction
of, any of the foregoing, or for proceeds payable under, or unearned premiums
with respect to, policies of insurance in respect of any of the foregoing,
rights to any returned or repossessed goods relating to any of the foregoing,
and any condemnation or requisition payments with respect to any of the
foregoing.
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SCHEDULE 7
SCHEDULE OF FILINGS
DEBTOR FILING FILE DATE OF
OFFICER NUMBER FILING*
--------
1 Indicate lapse date, of other than fifth anniversary.
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EXHIBIT B
[FORM OF LOCKBOX LETTER]
_______________ __, 19__
[Name and Address of Lockbox Bank]
Re: ORBITAL SCIENCES CORPORATION
Gentlemen:
We hereby notify you that effective _______________, 19__, we have
transferred exclusive control of our lock-box account[s] No.[s]. ____________
(the "LOCKBOX ACCOUNT[S]") maintained with you under the terms of the [Lockbox
Agreement] attached hereto as Exhibit A to Xxxxxx Guaranty Trust Company of New
York, as Collateral Agent (the "COLLATERAL AGENT").
We hereby irrevocably instruct you to make all payments to be made by you
out of or in connection with the Lockbox Account[s] (i) to the Collateral Agent
for credit to account no. ____________ maintained by it at its office at
_______________________________ or (ii) as you may otherwise be instructed by
the Collateral Agent.
We also hereby notify you that the Collateral Agent shall be irrevocably
entitled to exercise any and all rights in respect of or in connection with the
Lockbox Account[s], including, without limitation, the right to specify when
payments are to be made out of or in connection with the Lockbox Account[s] and
the right to exercise sole dominion and control over all the contents in the
lock-box(es), including the right to deny any person access to such contents.
All funds deposited into the Lockbox Account[s] will not be subject to
deductions, set-off, banker's lien or any other right in favor of any other
person than the Collateral Agent, except that you may set-off against the
Lockbox Account[s] the face amount of any check deposited in and credited to
such Lockbox Account[s] which is subsequently returned for any reason. Your
compensation for providing the services contemplated herein shall be as mutually
agreed between you and us from time to time and we will continue to pay such
compensation.
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Please confirm your acknowledgment of and agreement to the foregoing
instructions by signing in the space provided below.
Very truly yours,
ORBITAL SCIENCES CORPORATION
By
Name:
Title:
Acknowledged and agreed to as of
this ____ day of ____________, 19__.
[LOCKBOX BANK]
By
Name:
Title:
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EXHIBIT C
OPINION OF
COUNSEL FOR DEBTOR
* * * *
1. The provisions of the Credit Agreement and the Company Security
Agreements are sufficient to create in favor of the Collateral Agent a security
interest in all right, title and interest of each Debtor in those items and
types of the Collateral described in the Security Agreement to which it is a
party in which a security interest may be created under Article 9 of the Uniform
Commercial Code as in effect in the State of New York.
2. Financing statements on Form UCC-1 have been duly executed by the
Debtor and have been duly filed in each filing office indicated in the
Perfection Certificate of the Debtor under the Uniform Commercial Code in effect
in each state in which said filing offices are located. The description of the
Collateral set forth in said financing statements is sufficient to perfect a
security interest in the items and types of Collateral described therein in
which a security interest may be perfected by the filing of a financing
statement under the Uniform Commercial Code as in effect in such states. Such
filings are sufficient to perfect the security interests created by the Security
Agreement in all right, title and interest of the Debtor party thereto in those
items and types of Collateral described in the Security Agreement in which a
security interest may be perfected by the filing of financing statements under
the Uniform Commercial Code in such states, except that we express no opinion as
to personal property affixed to real property in such a manner as to become a
fixture under the laws of any state in which Collateral may be located, and we
call your attention to the fact that the Collateral Agent's security interest in
certain of such Collateral may not be perfected by the filing of financing
statements under the Uniform Commercial Code.
