EXECUTION COPY
SECURITY AGREEMENT
This SECURITY AGREEMENT, dated as of December 22, 2005 (as amended,
restated, amended and restated, supplemented or otherwise modified from time to
time, this "Agreement"), is made by INTEGRA LIFESCIENCES HOLDINGS CORPORATION, a
Delaware corporation (the "Borrower"), and each of the other Persons (such
capitalized term and all other capitalized terms not otherwise defined herein to
have the meanings provided for in Article I) listed on the signature pages
hereof (such other Persons, together with the Additional Grantors (as defined in
Section 7.2(b)) and the Borrower are collectively referred to as the "Grantors"
and individually as a "Grantor"), in favor of BANK OF AMERICA, N.A., as
administrative and collateral agent (in such capacity, the "Administrative
Agent") for each of the Secured Parties (as defined in the Credit Agreement
referred to below).
W I T N E S S E T H:
WHEREAS, pursuant to a Credit Agreement, dated as of the date hereof
(as amended, restated, amended and restated, supplemented or otherwise modified
from time to time, the "Credit Agreement"), among the Borrower, the various
financial institutions as are, or may from time to time become, parties thereto,
the Administrative Agent, Citibank FSB and SunTrust Bank, as Co-Syndication
Agents, Royal Bank of Canada and Wachovia Bank, National Association, as
Co-Documentation Agents and the other Loan Documents referred to therein, the
Secured Parties have agreed to make Credit Extensions and other financial
accommodations available to or for the benefit of the Grantors;
WHEREAS, as a condition precedent to the making of the initial Credit
Extension under the Credit Agreement, each Grantor is required to execute and
deliver this Agreement; and
WHEREAS, each Grantor has duly authorized the execution, delivery and
performance of this Agreement;
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and in order to induce the Lenders
to make Credit Extensions (including the initial Credit Extension) to the
Borrower pursuant to the Credit Agreement, each Grantor agrees, for the benefit
of each Secured Party, as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. The following terms (whether or not underscored) when
used in this Agreement, including its preamble and recitals, shall have the
following meanings (such definitions to be equally applicable to the singular
and plural forms thereof):
"Account" means a right to payment of a monetary obligation, whether or
not earned by performance (and shall include invoices, contracts, rights,
accounts receivable, notes, refunds, indemnities, interest, late charges, fees,
undertakings, and all other obligations and amounts owing to any Grantor from
any Person):
(a) for property that has been or is to be sold, leased,
licensed, assigned or otherwise disposed of;
(b) for services rendered or to be rendered;
(c) for a policy of insurance issued or to be issued;
(d) for a secondary obligation incurred or to be incurred;
(e) for energy provided or to be provided;
(f) for the use or hire of a vessel under a charter or other
contract;
(g) arising out of the use of a credit or charge card or
information contained on or for use with the card; or
(h) as winnings in a lottery or other game of chance operated
or sponsored by a state, governmental unit of a State, or Person licensed or
authorized to operate the game by a State or governmental unit of a State.
"Account Control Agreement" means an account control agreement in
substantially the form of Exhibit A-1 or A-2 hereto, as applicable, or otherwise
in form and substance reasonably satisfactory to the Administrative Agent,
entered into among a Grantor, the Administrative Agent and the bank or
Securities Intermediary where a Deposit Account or Securities Account,
respectively, of such Grantor is maintained, as such agreement may be amended,
restated, amended and restated, supplemented or otherwise modified from time to
time.
"Additional Grantors" is defined in Section 7.2(b).
"Administrative Agent" is defined in the preamble.
"Agreement" is defined in the preamble.
"Authenticate" means:
(a) to sign; or
(b) to execute or otherwise adopt a symbol, or encrypt or
similarly process a record in whole or in part, with the present intent of the
authenticating Person to identify the Person and adopt or accept a record.
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"Borrower" is defined in the preamble.
"Chattel Paper" means a record or records that evidence both a monetary
obligation and a security interest in specific goods, a security interest in
specific goods and software used in the goods, a security interest in specific
goods and license of software used in the goods, a lease of specific goods, or a
lease of specific goods and license of software used in the goods.
"Collateral" is defined in Section 2.1.
"Collateral Account" means, for each Grantor, a deposit account in the
name of the Administrative Agent and subject to the sole dominion and control of
the Administrative Agent.
"Commercial Tort Claim" means a claim arising in tort with respect to
which:
(a) the claimant is an organization; or
(b) the claimant is an individual and the claim:
(i) arose in the course of the claimant's business or
profession; and
(ii) does not include damages arising out of personal
injury to or the death of an individual.
"Commodity Account" means an account maintained by a Commodity
Intermediary in which a Commodity Contract is carried out for a Commodity
Customer.
"Commodity Contract" means a commodity futures contract, an option on a
commodity futures contract, a commodity option or any other contract that, in
each case, is
(a) traded on or subject to the rules of a board of trade that
has been designated as a contract market for such a contract pursuant to the
federal commodities laws; or
(b) traded on a foreign commodity board of trade, exchange or
market, and is carried on the books of a Commodity Intermediary for a Commodity
Customer.
"Commodity Customer" means a Person for whom a Commodity Intermediary
carries a Commodity Contract on its books.
"Commodity Intermediary" means:
(a) a Person who is registered as a futures commission
merchant under the federal commodities laws; or
(b) a Person who in the ordinary course of its business
provides clearance or settlement services for a board of trade that has been
designated as a contract market pursuant to federal commodities laws.
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"Computer Hardware and Software Collateral" means, to the extent
assignable:
(a) all computer and other electronic data processing
hardware, integrated computer systems, central processing units, memory units,
display terminals, printers, features, computer elements, card readers, tape
drives, hard and soft disk drives, cables, electrical supply hardware,
generators, power equalizers, accessories and all peripheral devices and other
related computer hardware;
(b) all software programs (including both source code, object
code and all related applications and data files), whether now owned or
hereafter acquired by each Grantor, designed for use on the computers and
electronic data processing hardware described in clause (a) above;
(c) all licenses and leases of software programs;
(d) all firmware associated therewith;
(e) all documentation (including flow charts, logic diagrams,
manuals, guides and specifications) with respect to such hardware, software and
firmware described in the preceding clauses (a) through (d); and
(f) all rights with respect to all of the foregoing, including
any and all copyrights, licenses, options, warranties, service contracts,
program services, test rights, maintenance rights, support rights, improvement
rights, renewal rights and indemnifications and any substitutions, replacements,
additions, modifications or model conversions of any of the foregoing.
"Control" means the act or condition of gaining or maintaining control
of collateral by any appropriate method under the UCC.
"Credit Agreement" is defined in the first recital.
"Deposit Account" means a demand, time, savings, passbook, or similar
account (including all bank accounts, collection accounts and concentration
accounts, together with all funds held therein and all certificates and
instruments, if any, from time to time representing or evidencing such accounts)
maintained with a bank.
"Documents" means a document of title or a receipt of the type
described in Section 7-201(2) of the UCC.
"Electronic Chattel Paper" means Chattel Paper evidenced by a record or
records consisting of information stored in an electronic medium.
"Entitlement Holder" means a Person identified in the records of a
Securities Intermediary as the Person having a Security Entitlement against the
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Securities Intermediary. If a person acquires a Security Entitlement by virtue
of Section 8-501(b)(2) or (3) of the UCC, such person is the Entitlement Holder.
"Equipment" means all machinery, equipment in all its forms, wherever
located, including all computers, furniture and furnishings, all other property
similar to the foregoing (including tools, parts, rolling stock and supplies of
every kind and description), components, parts and accessories installed thereon
or affixed thereto and all parts thereof, and all fixtures (other than those
which Borrower has no right to remove from the applicable property) and all
accessories, additions, attachments, improvements, substitutions and
replacements thereto and therefor.
"Financial Asset" means:
(a) a Security;
(b) an obligation of a Person or a share, participation or
other interest in a Person or in property or an enterprise of a Person, which
is, or is of a type, dealt with in or traded on financial markets, or which is
recognized in any area in which it is issued or dealt in as a medium for
investment; or
(c) any property that is held by a Securities Intermediary for
another person in a Securities Account if the Securities Intermediary has
expressly agreed with the other Person that the property is to be treated as a
Financial Asset under Article 8 of the UCC As the context requires, the term
Financial Asset shall mean either the interest itself or the means by which a
Person's claim to it is evidenced, including a certificated or uncertificated
Security, a certificate representing a Security or a Security Entitlement.
"General Intangible" means any personal property, including things in
action, Payment Intangibles and software, other than Accounts, Chattel Paper,
Commercial Tort Claims, Deposit Accounts, Documents, Goods,
Health-Care-Insurance Receivables, Instruments, Investment Property,
Letter-of-Credit Rights, letters of credit, money, and oil, gas, or other
minerals before extraction.
"Goods" means all things that are movable when a security interest
attaches, including computer programs embedded in goods and any supporting
information provided in connection with a transaction relating to the program if
(i) the program is associated with the goods in such a manner that is
customarily considered part of the goods, or (ii) by becoming the owner of the
goods, a person acquires a right to use the program in connection with the
goods.
"Grantor" and "Grantors" are defined in the preamble.
"Health-Care-Insurance Receivable" means an interest in or claim under
a policy of insurance which is a right to payment of a monetary obligation for
health-care goods or services provided.
"Indemnitee" is defined in Section 6.2.
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"Instrument" means a negotiable instrument or any other writing that
evidences a right to the payment of a monetary obligation, is not itself a
security agreement or lease, and is of a type that in ordinary course of
business is transferred by delivery with any necessary endorsement or
assignment.
"Inventory" means Goods, other than farm products, which:
(a) are leased by a Person as lessor;
(b) are held by a Person for sale or lease or to be furnished
under a contract of service;
(c) are furnished by a Person under a contract of service; or
(d) consist of raw materials, work in process, or materials
used or consumed in a business,
and includes, without limitation, (i) finished goods, returned goods and
materials and supplies of any kind, nature or description which are or might be
used in connection with the manufacture, packing, shipping, advertising, selling
or finishing of any of the foregoing; (ii) all goods in which a Grantor has an
interest in mass or a joint or other interest or right of any kind (including
goods in which Grantor has an interest or right as consignee); (iii) all goods
which are returned to or repossessed by any Grantor; and (iv) all accessions
thereto, products thereof and documents therefor.
"Investment Property" means all Securities (whether certificated or
uncertificated), Security Entitlements, Securities Accounts, Financial Assets,
Commodity Contracts and Commodity Accounts of each Grantor; provided, however,
that Investment Property shall not include any certificated Securities
constituting Collateral (as defined in the Pledge Agreement) or any Securities
issued by a Foreign Subsidiary.
"Letter-of-Credit Right" means a right to payment or performance under
a letter of credit, whether or not the beneficiary has demanded or is at the
time entitled to demand payment or performance, but excludes the right of a
beneficiary to demand payment or performance under a letter of credit.
"Loan Documents" is defined in the Credit Agreement.
"Material Contract" is defined in the Credit Agreement.
"Material Contract Collateral" means, with respect to each Grantor, all
Material Contracts to which such Grantor is now or may hereafter become a party
and all Accounts thereunder, including (i) all rights of such Grantor to receive
moneys due and to become due under or pursuant to the Material Contracts, (ii)
all rights of such Grantor to receive proceeds of any insurance, indemnity,
warranty or guaranty with respect to the Material Contracts, (iii) claims of
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such Grantor for damages arising out of or for breach of or default under the
Material Contracts and (iv) the right of such Grantor to terminate the Material
Contracts, to perform thereunder and to compel performance and otherwise
exercise all remedies thereunder.
"OFAC" means the U.S. Department of the Treasury's Office of Foreign
Assets Control.
"Payment Intangible" means a general intangible under which the account
debtor's principal obligation is a monetary obligation.
"Pledge Agreement" is defined in the Credit Agreement.
"Proceeds" means the following property:
(a) whatever is acquired upon the sale, lease, license,
exchange, or other disposition of the Collateral;
(b) whatever is collected on, or distributed on account of,
the Collateral;
(c) rights arising out of the Collateral; and
(d) to the extent of the value of the Collateral and to the
extent payable to the debtor or the secured party, insurance payable by reason
of the loss or nonconformity of, defects or infringement of rights in, or damage
to, the Collateral.
"Receivables Collateral" means, collectively, Accounts,
Health-Care-Insurance Receivables, Documents, Instruments and Chattel Paper.
"Sanctioned Entity" means (i) an agency of the government of, (ii) an
organization directly or indirectly controlled by, or (iii) a person resident in
a country that is subject to a sanctions program identified on the list
maintained by OFAC and available at
xxxx://xxx.xxxxx.xxx/xxxxxxx/xxxxxx/xxxx/xxxxxxxxx/xxxxx.xxxx, or as otherwise
published from time to time as such program may be applicable to such agency,
organization or person.
"Sanctioned Person" means a person named on the list of Specially
Designated Nationals or Blocked Persons maintained by OFAC available at
xxxx://xxx.xxxxx.xxx/xxxxxxx/xxxxxx/xxxx/xxx/xxxxx.xxxx, or as otherwise
published from time to time.
"Secured Cash Management Services Agreement" is defined in the Credit
Agreement.
"Secured Obligations" is defined in Section 2.2.
"Secured Party" is defined in the Credit Agreement.
"Secured Swap Contract" is defined in the Credit Agreement.
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"Securities" means any obligations of an issuer or any shares,
participations or other interests in an issuer or in property or an enterprise
of an issuer which
(a) are represented by a certificate representing a security
in bearer or registered form, or the transfer of which may be registered upon
books maintained for that purpose by or on behalf of the issuer;
(b) are one of a class or series or by its terms is divisible
into a class or series of shares, participations, interests or obligations; and
(c) (i) are, or are of a type, dealt with or traded on
securities exchanges or securities markets or (ii) are a medium for investment
and by their terms expressly provide that they are a security governed by
Article 8 of the UCC.
"Securities Account" shall mean an account to which a Financial Asset
is or may be credited in accordance with an agreement under which the Person
maintaining the account undertakes to treat the Person for whom the account is
maintained as entitled to exercise rights that comprise the Financial Asset.
"Security Entitlements" means the rights and property interests of an
Entitlement Holder with respect to a Financial Asset.
"Security Intermediary" means:
(a) a clearing corporation; or
(b) a Person, including a bank or broker, that in the ordinary
course of its business maintains securities accounts for others and is acting in
that capacity.
"Supporting Obligation" means a Letter-of-Credit Right or secondary
obligation that supports the payment or performance of an Account, Chattel
Paper, Document, General Intangible, Instrument or Investment Property,
including, without limitation, all security agreements, guaranties, leases and
other contracts securing or otherwise relating to any such Accounts, Chattel
Paper, Documents, General Intangible, Instruments or Investment Property,
including Goods represented by the sale or lease of delivery which gave rise to
any of the foregoing, returned or repossessed merchandise and rights of stoppage
in transit, replevin, reclamation and other rights and remedies of an unpaid
vendor, lienor or secured party.
"Swap Bank" is defined in the Credit Agreement.
"Swap Contract" is defined in the Credit Agreement.
"Tangible Chattel Paper" means Chattel Paper evidenced by a record or
records consisting of information that is inscribed on a tangible medium.
"Termination Date" means the date on which the latest of the following
events occurs:
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(a) the payment in full in cash of the Secured Obligations,
other than contingent indemnification obligations;
(b) the termination or expiration of the Availability Period;
and
(c) the termination or expiration of all Letters of Credit and
all Secured Swap Contracts to which a Swap Bank is a party.
"UCC" is defined in the Credit Agreement.
1.2 Credit Agreement Definitions. Unless otherwise defined herein or
the context otherwise requires, terms used in this Agreement, including its
preamble and recitals, have the meanings provided in the Credit Agreement.
1.3 UCC Definitions. Unless otherwise defined herein or the context
otherwise requires, terms for which meanings are provided in the UCC are used in
this Agreement, including its preamble and recitals, with such meanings.
1.4 Other Interpretive Provisions. The rules of construction in
Sections 1.02 to 1.06 of the Credit Agreement shall be equally applicable to
this Agreement.
ARTICLE II
SECURITY INTEREST
2.1 Grant of Security. Each Grantor hereby assigns and pledges to the
Administrative Agent for its benefit and the ratable benefit of each of the
Secured Parties, and hereby grants to the Administrative Agent for its benefit
and the ratable benefit of each of the Secured Parties a security interest in,
all of its right, title and interest in and to the following, whether now or
hereafter existing or acquired (collectively, the "Collateral"):
(a) all Equipment of such Grantor;
(b) all Inventory of such Grantor;
(c) all Receivables Collateral forms, including all
Accounts, Documents, Instruments, Health-Care-Insurance Receivables and Chattel
Paper, of such Grantor;
(d) to the extent not included under clause (c) above, all
Material Contract Collateral of such Grantor;
(e) all General Intangibles, including all Payment
Intangibles, of such Grantor;
(f) all Supporting Obligations of such Grantor;
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(g) all Investment Property, including all Securities
Accounts, of such Grantor;
(h) all Deposit Accounts of such Grantor;
(i) all Commercial Tort Claims of such Grantor described in
Part E of Schedule I hereto (as such Schedule may be supplemented from time to
time pursuant to Section 4.14 or otherwise);
(j) all other Goods of such Grantor;
(k) all of such Grantor's books, records, writings, data
bases, information and other property relating to, used or useful in connection
with, evidencing, embodying, incorporating or referring to, any of the foregoing
in this Section 2.1;
(l) all of such Grantor's other property and rights of every
kind and description and interests therein, including all moneys, securities and
other property, now or hereafter held or received by, or in transit to, the
Administrative Agent or any Secured Party from or for such Grantor, whether for
safekeeping, pledge, custody, transmission, collection or otherwise; and
(m) all Proceeds of any and all of the foregoing Collateral.
Notwithstanding the foregoing, (i) no account, instrument, chattel paper or
other obligation or property of any kind due from, owed by, or belonging to, a
Sanctioned Person or Sanctioned Entity, (ii) any lease in which the lessee is a
Sanctioned Person or Sanctioned Entity or (iii) any key man life insurance
policy of which the Borrower or any Guarantor is a beneficiary shall be
Collateral.
2.2 Security for Secured Obligations. The Collateral of each Grantor
under this Agreement secures the prompt and complete payment, performance and
observance of all Obligations of such Grantor and the other Loan Parties under
the Loan Documents (including such Grantor's Obligations in respect of any
Secured Swap Contract and any Secured Cash Management Services Agreement),
whether for principal, interest, costs, fees, expenses, indemnities or otherwise
and whether now or hereafter existing (all of such obligations being the
"Secured Obligations").
2.3 Continuing Security Interest; Transfer of Credit Extensions. This
Agreement shall create a continuing security interest in the Collateral and
shall remain in full force and effect until the Termination Date, be binding
upon each Grantor, its successors, transferees and assigns, and inure, together
with the rights and remedies of the Administrative Agent hereunder, to the
benefit of the Administrative Agent and each other Secured Party. Without
limiting the generality of the foregoing, any Secured Party may assign or
otherwise transfer (in whole or in part) any Commitment or Loan held by it to
any other Person, and such other Person shall thereupon become vested with all
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the rights and benefits in respect thereof granted to such Lender under any Loan
Document (including this Agreement) or otherwise, subject, however, to any
contrary provisions in such assignment or transfer, and to the provisions of
Section 10.07 and Article IX of the Credit Agreement.
2.4 Grantors Remain Liable. Anything herein to the contrary
notwithstanding
(a) each Grantor shall remain liable under the contracts and
agreements included in the Collateral (including the Material Contracts) to the
extent set forth therein, and shall perform all of its duties and obligations
under such contracts and agreements to the same extent as if this Agreement had
not been executed,
(b) each Grantor will comply in all material respects with all
Laws relating to the ownership and operation of the Collateral, including all
registration requirements under applicable Laws, and shall pay when due all
taxes, fees and assessments imposed on or with respect to the Collateral, except
to the extent the same are being contested in good faith by appropriate actions
or proceedings for which adequate reserves in accordance with GAAP have been set
aside by such Grantor,
(c) the exercise by the Administrative Agent of any of its
rights hereunder shall not release any Grantor from any of its duties or
obligations under any such contracts or agreements included in the Collateral,
and
(d) neither the Administrative Agent nor any other Secured
Party shall have any obligation or liability under any such contracts or
agreements included in the Collateral by reason of this Agreement, nor shall the
Administrative Agent or any other Secured Party be obligated to perform any of
the obligations or duties of any Grantor thereunder or to take any action to
collect or enforce any claim for payment assigned hereunder.
2.5 Security Interest Absolute. All rights of the Administrative Agent
and the security interests granted to the Administrative Agent hereunder, and
all obligations of each Grantor hereunder, shall be absolute and unconditional,
irrespective of any of the following conditions, occurrences or events:
(a) any lack of validity or enforceability of any Loan
Document;
(b) the failure of any Secured Party to assert any claim or
demand or to enforce any right or remedy against the Borrower, any other Grantor
or any other Person under the provisions of any Loan Document or otherwise or to
exercise any right or remedy against any other guarantor of, or collateral
securing, any Secured Obligation;
(c) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Secured Obligations or any other
extension, compromise or renewal of any Secured Obligation, including any
increase in the Secured Obligations resulting from the extension of additional
credit to any Grantor or any other obligor or otherwise;
(d) any reduction, limitation, impairment or termination of
any Secured Obligation for any reason, including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to (and each
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Grantor hereby waives any right to or claim of) any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality, nongenuineness, irregularity, compromise, unenforceability of, or
any other event or occurrence affecting, any Secured Obligation or otherwise;
(e) any amendment to, rescission, waiver, or other
modification of, or any consent to departure from, any of the terms of any Loan
Document;
(f) any addition, exchange, release, surrender or
non-perfection of any collateral (including the Collateral), or any amendment to
or waiver or release of or addition to or consent to departure from any
guaranty, for any of the Secured Obligations; or
(g) any other circumstances which might otherwise constitute a
defense available to, or a legal or equitable discharge of, Borrower, any other
Grantor or otherwise.
2.6 Waiver of Subrogation. Until the Termination Date, no Grantor shall
exercise any claim or other rights which it may now or hereafter acquire against
any other Grantor that arises from the existence, payment, performance or
enforcement of such Grantor's Obligations under this Agreement, including any
right of subrogation, reimbursement, exoneration or indemnification, any right
to participate in any claim or remedy against any other Grantor or any
Collateral which the Administrative Agent now has or hereafter acquires, whether
or not such claim, remedy or right arises in equity or under contract, statute
or common law, including the right to take or receive from any other Grantor,
directly or indirectly, in cash or other property or by setoff or in any manner,
payment or security on account of such claim or other rights. If any amount
shall be paid to any Grantor in violation of the preceding sentence, such amount
shall be deemed to have been paid for the benefit of the Secured Parties, and
shall forthwith be paid to the Administrative Agent to be credited and applied
upon the Secured Obligations, whether matured or unmatured. Each Grantor
acknowledges that it will receive direct and indirect benefits for the financing
arrangements contemplated by the Loan Documents and that the agreement set forth
in this Section is knowingly made in contemplation of such benefits.
2.7 Release; Termination.
(a) Upon any sale, transfer or other disposition of any item
of Collateral, whether direct or indirect, of any Grantor in accordance with
Section 7.05 of the Credit Agreement, the Administrative Agent will, at such
Grantor's expense and without any representations, warranties or recourse of any
kind whatsoever, execute and deliver to such Grantor such documents as such
Grantor shall reasonably request to evidence the release of such item of
Collateral from the assignment and security interest granted hereby; provided,
however, that (i) at the time of such request and such release no Event of
Default shall have occurred and be continuing and (ii) such Grantor shall have
delivered to the Administrative Agent, at least ten Business Days prior to the
date of the proposed release, a written request for release describing the item
of Collateral and the terms of the sale, lease, transfer or other disposition in
reasonable detail, including the price thereof and any expenses in connection
therewith, together with a form of release for execution by the Administrative
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Agent (which release shall be in form and substance satisfactory to the
Administrative Agent) and a certificate of such Grantor to the effect that the
transaction is in compliance with the Loan Documents and as to such other
matters as the Administrative Agent (or the Required Lenders through the
Administrative Agent) may reasonably request. The provisions of this Section
2.7(a) shall apply to Dispositions of the capital stock of a Grantor (whether
direct or indirect) in compliance with Section 7.05 of the Credit Agreement.
(b) Upon the Termination Date, the pledge, assignment and
security interest granted hereby shall terminate and all rights to the
Collateral shall revert to the applicable Grantor. Upon any such termination,
the Administrative Agent will, at the applicable Grantor's expense and without
any representations, warranties or recourse of any kind whatsoever, execute and
deliver to such Grantor such documents as such Grantor shall reasonably request
to evidence such termination and deliver to such Grantor all Instruments,
Tangible Chattel Paper and negotiable documents representing or evidencing the
Collateral then held by the Administrative Agent.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each Grantor represents and warrants unto each Secured Party as set
forth in this Article.
3.1 Scheduled Information. Set forth in the Schedules to this Agreement
is the following information for each Grantor, all of which is accurate and
complete as of the Closing Date and as of each date on which such Schedules are
supplemented pursuant to Section 4.15 hereof:
(a) Location of Grantors. Item A of Schedule I hereto
identifies for such Grantor (i) the state in which it is organized, (ii) the
relevant organizational identification number (or states that one does not
exist), and (iii) the principal place of business and chief executive office of
such Grantor and the office where such Grantor keeps its records concerning the
Collateral, and where the original copies of each Material Contract and all
originals of all Tangible Chattel Paper are located.
(b) Owned Properties. Except as disclosed in Item C of
Schedule I hereto (as such Schedule may be supplemented from time to time
pursuant to Section 4.15 hereof), all of the Equipment and Inventory of such
Grantor are located at the places specified in Item B of Schedule I hereto (as
such Schedule may be supplemented from time to time pursuant to Section 4.15
hereof), each of which locations is owned by a Grantor.
(c) Leased Properties; Warehouses; etc. Except as disclosed in
Item C of Schedule I hereto (as such Schedule may be supplemented from time to
time pursuant to Section 4.15 hereof), none of the Collateral is in the
possession of any consignee, bailee, warehouseman, agent or processor, located
on any leased property or subject to the Control of any Person, other than the
Administrative Agent, such Grantor or another Grantor.
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(d) Trade Names. Except as set forth in Item D of Schedule I
hereto, such Grantor has no trade names and has not been known by any legal name
different from the one set forth on the signature page hereto.
(e) Commercial Torts Claims. Item E of Schedule I hereto (as
such Schedule may be supplemented from time to time pursuant to Section 4.15
hereof), describes all Commercial Tort Claims owned by each Grantor as of the
date hereof and as of the date of each supplement to such Schedule delivered
pursuant to Section 4.15 hereof.
(f) Government Contracts. Except as notified by such Grantor
to the Administrative Agent in writing, such Grantor is not a party to any one
or more Federal, state or local government contracts.
3.2 Negotiable Documents, Instruments, Chattel Paper and Material
Contracts. Such Grantor has delivered to the Administrative Agent possession of
all originals of all negotiable Documents, Instruments and Tangible Chattel
Paper currently owned or held by such Grantor (duly endorsed in blank, if
requested by the Administrative Agent), and true and correct copies of each
Material Contract.
3.3 Loan Documents Representations. Each Grantor makes each
representation and warranty made in the Credit Agreement and the other Loan
Documents by the Borrower or any other Loan Party with respect to such Grantor
as if such representation and warranty were expressly set forth herein.
ARTICLE IV
COVENANTS
Each Grantor covenants and agrees that, until the Termination Date,
such Grantor will, unless the Administrative Agent with the consent of the
Required Lenders shall otherwise agree in writing, perform the obligations set
forth in this Section.
4.1 As to Collateral Generally.
(a) Until such time as the Administrative Agent shall notify
the Grantors of the revocation of such power and authority after the occurrence
and continuation of any Event of Default, each Grantor (i) may in the ordinary
course of its business, at its own expense, sell, lease or furnish under its
contracts of service any of the Inventory normally held by such Grantor for such
purpose, and use and consume, in the ordinary course of its business, any raw
materials, work in process or materials normally held by such Grantor for such
purpose, and sell or otherwise dispose of any other Collateral to the extent
permitted by Section 7.05 of the Credit Agreement, (ii) will, at its own
expense, to the extent commercially reasonable or otherwise as Grantor in good
xxxxx xxxxx advisable, endeavor to collect, as and when due, all amounts due
with respect to any of the Collateral, including the taking of such action with
respect to such collection; and (iii) may grant, in the ordinary course of
business, to any party obligated on any of the Collateral, any rebate, refund or
allowance to which such party may be lawfully entitled in such Grantor's
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reasonable determination, and may accept, in connection therewith, the return of
goods, the sale or lease of which shall have given rise to such Collateral. The
Administrative Agent, however, may, at any time following the occurrence and
during the continuance of any Event of Default, whether before or after any
revocation of such power and authority or the maturity of any of the Secured
Obligations, notify any parties obligated on any of the Collateral to make
payment to the Administrative Agent of any amounts due or to become due
thereunder and enforce collection of any of the 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 any
Event of Default, each Grantor will, at its own expense, notify any parties
obligated on any of the Collateral to make payment to the Administrative Agent
of any amounts due or to become due thereunder.
(b) The Administrative Agent is authorized to endorse, in the
name of each Grantor, any item, howsoever received by the Administrative Agent,
representing any payment on or other proceeds of any of the Collateral.
4.2 Insurance. Each Grantor will maintain or cause to be maintained
insurance as provided in Section 6.07 of the Credit Agreement. In the event that
any Grantor at any time or times shall fail to obtain or maintain any of the
policies of insurance required by Section 6.07 of the Credit Agreement or to pay
any premium in whole or part relating thereto, the Administrative Agent may,
without waiving or releasing any obligation or liability of the Grantors
hereunder or any Event of Default, in its sole discretion, obtain and maintain
such policies of insurance and pay such premium and take any other actions with
respect thereto as the Administrative Agent deems advisable. All sums disbursed
by the Administrative Agent in connection with this Section including reasonable
attorneys' fees, court costs, expenses and other charges relating thereto, shall
be payable, upon demand, by the Grantors to the Administrative Agent and shall
be additional Secured Obligations secured hereby.
4.3 Transfers and Other Liens. No Grantor shall:
(a) sell, assign (by operation of Law or otherwise) or
otherwise dispose of any of the Collateral, except as permitted by Section 7.05
of the Credit Agreement; or
(b) create or suffer to exist any Lien upon or with respect to
any of the Collateral, except for the security interest created by this
Agreement and except for Permitted Liens.
4.4 Inspections and Verification. The Administrative Agent shall have
the inspection rights set forth in Section 6.10 of the Credit Agreement.
4.5 As to Equipment and Inventory. Each Grantor hereby agrees that it
shall
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(a) keep all the Equipment and Inventory (other than Inventory
sold in the ordinary course of business) at the places therefor specified in
Section 3.1(b) or (c) unless such Grantor has given at least 10 days' prior
written notice to the Administrative Agent of another location, whether by
delivery of a supplement to Schedule I hereto delivered pursuant to Section 4.15
hereto or otherwise, and all action, if any, necessary to maintain in accordance
with the terms hereof the Administrative Agent's perfected first priority
security interest therein (including any action requested pursuant to Section
4.6) shall have been taken with respect to the Equipment and Inventory;
(b) cause the Equipment to be maintained, preserved and
protected in accordance with Section 6.06 of the Credit Agreement; and
(c) pay promptly when due all property and other taxes,
assessments and governmental charges or levies imposed upon, and all claims
(including claims for labor, materials and supplies) against, the Equipment and
Inventory, except to the extent the same are being contested in good faith by
appropriate actions or proceedings and for which adequate reserves in accordance
with GAAP have been set aside.
4.6 [Intentionally deleted.]
4.7 As to Accounts, Chattel Paper, Documents and Instruments.
(a) Each Grantor shall: (i) keep its principal place of
business and chief executive office and the office where it keeps its records
concerning the Receivables Collateral and all originals of all Tangible Chattel
Paper (until any such Tangible Chattel Paper is delivered to the Administrative
Agent pursuant to Section 4.10), located at the places therefor specified in
Section 3.1 unless the Borrower or such Grantor has given at least 30 days'
prior written notice to the Administrative Agent, and all actions, if any,
necessary to maintain the Administrative Agent's perfected first priority
security interest shall have been taken with respect to such Collateral; (ii)
not change its name or jurisdiction of organization (whether pursuant to a
transaction permitted pursuant to Section 7.04 of the Credit Agreement or
otherwise) unless the Borrower or such Grantor has given at least 30 days' prior
written notice to the Administrative Agent, and all actions necessary to
maintain the Administrative Agent's perfected first priority security interest
shall have taken with respect to the Collateral of such Grantor; and (iii) hold
and preserve such records and Chattel Paper (or copies of any such Chattel Paper
so delivered to the Administrative Agent).
(b) Upon written notice by the Administrative Agent to any
Grantor, all Proceeds of Collateral received by such Grantor shall be delivered
in kind to the Administrative Agent for deposit to the Collateral Account for
such Grantor, and such Grantor shall not commingle any such proceeds, and shall
hold separate and apart from all other property, all such Proceeds in express
trust for the benefit of the Administrative Agent until delivery thereof is made
to the Administrative Agent. The Administrative Agent will not give the notice
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referred to in the preceding sentence unless there shall have occurred and be
continuing any Event of Default. No funds, other than Proceeds of Collateral of
a Grantor, will be deposited in the Collateral Account for such Grantor.
(c) The Administrative Agent shall have the right to apply any
amount in the Collateral Account to the payment of any Secured Obligations which
are due and payable or payable upon demand, or to the payment of any Secured
Obligations at any time that any Event of Default shall exist. Subject to the
rights of the Administrative Agent, the Borrower on behalf of each Grantor shall
have the right on each Business Day, with respect to and to the extent of
collected funds in the Collateral Account, to require the Administrative Agent
to purchase any cash equivalent Investment permitted under Section 7.02 of the
Credit Agreement, provided that, in the case of certificated securities, the
Administrative Agent will retain possession thereof as Collateral and, in the
case of other Investment Property, the Administrative Agent will take such
actions, including registration of such Investment Property in its name, as it
shall determine is necessary to perfect its security interest therein. The
Administrative Agent may at any time and shall promptly following any Grantor's
request therefor, so long as no Event of Default has occurred and is continuing,
transfer to such Grantor's general demand deposit account at the Administrative
Agent or its bank (if not the Administrative Agent) any or all of the collected
funds in the Collateral Account; provided, however, that any such transfer shall
not be deemed to be a waiver or modification of any of the Administrative
Agent's rights under this Section. None of the Grantors will, without the
Administrative Agent's prior written consent, grant any extension of the time of
payment of any Receivables Collateral, compromise, compound or settle the same
for less than the full amount thereof, release, wholly or partly, any Person
liable for the payment thereof or allow any credit or discount whatsoever
thereon, other than extensions, credits, discounts, compromises or settlements
granted or made in the ordinary course of business and consistent with its
current practices and in accordance with such prudent and standard practices
used in industries that are the same as or similar to those in which such
Grantor is engaged.
4.8 As to the Material Contracts. Each Grantor shall at its expense
furnish to the Administrative Agent promptly upon receipt thereof copies of all
material notices, requests and other documents received by such Grantor under or
pursuant to the Material Contracts, and from time to time furnish to the
Administrative Agent such information and reports regarding the Material
Contracts as the Administrative Agent may reasonably request and otherwise
comply with the provisions regarding Material Contracts set forth in Section
6.13 of the Credit Agreement.
4.9 Chattel Paper. Each Grantor will deliver to the Administrative
Agent all Tangible Chattel Paper duly endorsed and accompanied by duly executed
instruments of transfer or assignment, all in form and substance satisfactory to
the Administrative Agent. Each Grantor will provide the Administrative Agent
with Control of all Electronic Chattel Paper, by having the Administrative Agent
identified as the assignee of the records(s) pertaining to the single
authoritative copy thereof and otherwise complying with the applicable elements
of Control set forth in the UCC. Each Grantor will also deliver to the
Administrative Agent all security agreements securing any Chattel Paper and
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execute UCC financing statement amendments assigning to the Administrative Agent
any UCC financing statements filed by such Grantor in connection with such
security agreements. Each Grantor will xxxx conspicuously all Chattel Paper with
a legend, in form and substance satisfactory to the Administrative Agent,
indicating that such Chattel Paper is subject to the Liens created hereunder.
4.10 Letters of Credit. Each Grantor will deliver to the Administrative
Agent all Letters of Credit in which it is the beneficiary thereof, duly
endorsed and accompanied by duly executed instruments of transfer or assignment,
all in form and substance satisfactory to the Administrative Agent. Each Grantor
will take any and all actions necessary (or requested by the Administrative
Agent), from time to time, to cause the Administrative Agent to obtain exclusive
Control of any Letter-of-Credit Rights owned by such Grantor in a manner
acceptable to the Administrative Agent.
4.11 Commercial Tort Claims. Each Grantor shall advise the
Administrative Agent promptly upon such Grantor becoming aware, after the date
hereof, that it owns any additional Commercial Tort Claims in excess of
$1,000,000. With respect to any such Commercial Tort Claims, such Grantor will
execute and deliver such documents as the Administrative Agent deems necessary
to describe, create, perfect and protect the Administrative Agent's first
priority security interest in such Commercial Tort Claim.
4.12 Bank Accounts; Securities Accounts. Upon the occurrence and during
the continuance of an Event of Default and upon request by the Administrative
Agent, each Grantor shall enter into an Account Control Agreement with each
financial institution with which such Grantor maintains from time to time any
Deposit Account or any Securities Account. Each Grantor hereby grants to the
Administrative Agent, for the benefit of the Administrative Agent and the
Secured Parties, a continuing security interest in all such Deposit Accounts and
Securities Accounts and all funds and Investment Property at any time paid,
deposited, credited or held in such Deposit Accounts and Securities Accounts
(whether for collection, provisionally or otherwise) or otherwise in the
possession of such financial institutions, and each such financial institution
shall act as the Administrative Agent's agent in connection therewith.
4.13 Further Assurances, etc.
(a) Each Grantor agrees that, from time to time at its own
expense, such Grantor will promptly execute and deliver all further documents,
financing statements, agreements and instruments, and take all such further
action, which may be required under applicable Law, or which the Administrative
Agent or Required Lenders may reasonably request, in order to perfect, preserve
and protect any security interest granted or purported to be granted hereby or
to enable the Administrative Agent to exercise and enforce its rights and
remedies hereunder with respect to any Collateral. Without limiting the
generality of the foregoing, each Grantor will take each of the following
actions:
(i) [intentionally deleted.]
(ii) if any Account shall be evidenced by a promissory
note or other instrument or negotiable document, deliver and pledge to the
Administrative Agent hereunder such promissory note, instrument or negotiable
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document duly endorsed and accompanied by duly executed instruments of transfer
or assignment, all in form and substance reasonably satisfactory to the
Administrative Agent;
(iii) execute and file such financing or continuation
statements, or amendments thereto, and such other instruments or notices
(including any assignment of claim form under or pursuant to the federal
assignment of claims statute, 31 U.S.C. ss. 3726, any successor or amended
version thereof or any regulation promulgated under or pursuant to any version
thereof), as may be necessary, or as the Administrative Agent may reasonably
request, in order to perfect and preserve the security interests and other
rights granted or purported to be granted to the Administrative Agent hereby;
(iv) furnish to the Administrative Agent, from time to
time at the Administrative Agent's request, statements and schedules further
identifying and describing the Collateral and such other reports in connection
with the Collateral as the Administrative Agent may reasonably request, all in
reasonable detail;
(v) take all actions that the Administrative Agent deems
necessary or advisable to enforce collection of the Receivables Collateral;
(vi) if requested by the Administrative Agent, cause the
landlord, bailee, warehouseman or processor with Control over any Equipment or
Inventory of such Grantor to enter into a waiver agreement or to transfer any
such Equipment or Inventory to warehouses designated by the Administrative
Agent;
(vii) if requested by the Administrative Agent, each
Grantor which owns or leases Equipment which is subject to a certificate of
title statute that requires notation of a lien thereon to perfect a security
interest therein shall deliver to the Administrative Agent all original
certificates of title for such Equipment, shall take all necessary steps to
cause the Administrative Agent's security interest be perfected in accordance
with such statute and deliver to the Administrative Agent a schedule in
reasonable detail describing such Equipment, registration number, license number
and all other information required to comply with such statute; provided,
however, that until the Administrative Agent makes such a request under this
clause, the parties hereto acknowledge that the security interest of the
Administrative Agent in such Collateral has not been perfected and all the
representations and warranties, covenants and Events of Default contained herein
and in the other Loan Documents which would otherwise be violated shall be
deemed modified to reflect the foregoing and not be violated;
(viii) if requested by the Administrative Agent upon the
occurrence and during the continuance of an Event of Default, cause each bank or
Securities Intermediary with which any Grantor maintains a Deposit Account or
Securities Account to enter into an Account Control Agreement with respect
thereto;
(ix) from time to time, promptly following the
Administrative Agent's request, execute and deliver confirmatory written
instruments pledging to the Administrative Agent the Collateral, but any such
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Grantor's failure to do so shall not affect or limit the security interest
granted hereby or the Administrative Agent's other rights in and to the
Collateral; and
(x) notify the Agent promptly of any Collateral which
constitutes a claim against the United States government or any instrumentality
or agent thereof in excess of $1,000,000, the assignment of which is restricted
by federal law. Upon the request of the Agent, Grantor shall take such steps as
may be necessary to comply with any applicable federal assignment of claims laws
or other comparable laws.
(b) With respect to the foregoing and the grant of the
security interest hereunder, each Grantor hereby authorizes the Administrative
Agent to Authenticate and to file one or more financing or continuation
statements, and amendments thereto, for the purpose of perfecting, continuing,
enforcing or protecting the security interest granted by each Grantor, without
the signature of any Grantor, and naming any Grantor or the Grantors as debtors
and the Administrative Agent as secured party. A carbon, photographic,
telecopied or other reproduction of this Agreement or any financing statement
covering the Collateral or any part thereof shall be sufficient as a financing
statement where permitted by Law.
4.14 Supplements to Scheduled Information. Without limiting the
generality of Section 4.14, concurrently with the delivery by the Borrower of
each Compliance Certificate pursuant to Section 6.02(b) of the Credit Agreement,
the Borrower, on behalf of each Grantor, shall deliver to the Administrative
Agent the following applicable supplements to the Schedules hereto in such form
as shall be reasonably satisfactory to the Administrative Agent, together with a
certificate of Responsible Officers certifying that, as of the date thereof and
after giving effect to the supplements to such Schedules delivered therewith,
the representations and warranties in Article III hereof are true and correct in
all material respects:
(a) a supplement to Item B of Schedule I hereto identifying
any new location owned by a Grantor where any Equipment or Inventory of such
Grantor may be located which is not already identified on such Schedule;
(b) a supplement to Item C of Schedule I hereto identifying
any new consignee, warehouseman, agent, bailee, processor, leased property or
other similar location where any Equipment or Inventory of such Grantor is
located which is not already identified on such Schedule; and
(c) a supplement to Item E of Schedule I hereto describing any
new Commercial Tort Claim owned by such Grantor which is not described on such
Schedule in excess of $1,000,000.
4.15 Amendments or Terminations Not Authorized. Grantor acknowledges
that it is not authorized to file any financing statement or amendment or
termination statement with respect to a financing statement filed in favor of
the Agent without the prior written consent of the Agent and agrees that it will
not do so without the prior written consent of the Agent, subject to Grantor's
rights under Section 9-5.13(c) of the UCC.
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4.16 Certain Property. No Grantor owns (a) standing timber that is to
be cut and removed under a conveyance or contract for sale, (b) animals, (c)
crops grown, growing, or to be grown, even if the crops are produced on trees,
vines or bushes, or (d) manufactured homes.
ARTICLE V
THE ADMINISTRATIVE AGENT
5.1 Appointment as Attorney-in-Fact. Each Grantor hereby irrevocably
appoints the Administrative Agent and any officer or agent thereof, with full
power of substitution, as its true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of such Grantor and in
the name of such Grantor or in its own name, for the purpose of carrying out the
terms of this Agreement, to take, upon the occurrence and during the continuance
of any Event of Default, any and all appropriate action and to execute any and
all documents and instruments that may be necessary or desirable to accomplish
the purposes of this Agreement. Without limiting the generality of the
foregoing, each Grantor hereby gives the Administrative Agent the power and
right, on behalf of such Grantor, without notice to or assent by such Grantor,
to do any or all of the following:
(a) (i) demand payment of its Receivables Collateral; (ii)
enforce payments of its Receivables Collateral by legal proceedings or
otherwise; (iii) exercise all of its rights and remedies with respect to
proceedings brought to collect its Receivables Collateral; (iv) sell or assign
its Receivables Collateral upon such terms, for such amount and at such times as
the Administrative Agent deems advisable; (v) settle, adjust, compromise, extend
or renew any of its Receivables Collateral; (vi) discharge and release any of
its Receivables Collateral; (vii) prepare, file and sign such Grantor's name on
any proof of claim in bankruptcy or other similar document against any obligor
of any of its Receivables Collateral; (viii) notify the post office authorities
to change the address for delivery of such Grantor's mail to an address
designated by the Administrative Agent, and open and dispose of all mail
addressed to such Grantor; (ix) endorse such Grantor's name upon any Chattel
Paper, document, instrument, invoice, or similar document or agreement relating
to any Receivables Collateral or any goods pertaining thereto; and (x) endorse
such Grantor's name upon any Chattel Paper, document, instrument, invoice, or
similar document or agreement relating to any Receivables Collateral or any
goods pertaining thereto;
(b) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral, effect any repairs or any insurance called
for by the terms of this Agreement and pay all or any part of the premiums
therefor and the costs thereof;
(c) execute, in connection with any sale or other disposition
provided for in Section 6.1, any endorsements, assignments or other instruments
of conveyance or transfer with respect to the Collateral; and
(d) (i) direct any party liable for any payment under any of
the Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Administrative Agent or as the Administrative Agent
shall direct; (ii) ask or demand for, collect, and receive payment of and give
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receipt for, any and all moneys, claims and other amounts due or to become due
at any time in respect of or arising out of any Collateral; (iii) sign and
indorse any invoices, freight or express bills, bills of lading, storage or
warehouse receipts, drafts against debtors, assignments, verifications, notices
and other documents in connection with any of the Collateral; (iv) commence and
prosecute any suits, actions or proceedings at law or in equity in any court of
competent jurisdiction to collect the Collateral or any portion thereof and to
enforce any other right in respect of any Collateral; (v) defend any suit,
action or proceeding brought against such Grantor with respect to any
Collateral; (vi) settle, compromise or adjust any such suit, action or
proceeding and, in connection therewith, give such discharges or releases as the
Administrative Agent may deem appropriate; (vii) notify, or require any Grantor
to notify, Account Debtors to make payment directly to the Administrative Agent
and change the post office box number or other address to which the Account
Debtors make payments; and (viii) generally, sell, transfer, pledge and make any
agreement with respect to or otherwise deal with any of the Collateral as fully
and completely as though the Administrative Agent were the absolute owner
thereof for all purposes, and do, at the Administrative Agent's option and such
Grantor's expense, at any time, or from time to time, all acts and things that
the Administrative Agent deems necessary to protect, preserve or realize upon
the Collateral and the Secured Parties' security interests therein and to effect
the intent of this Agreement, all as fully and effectively as such Grantor might
do.
Each Grantor hereby acknowledges, consents and agrees that the power of
attorney granted pursuant to this Section is irrevocable and coupled with an
interest.
5.2 Administrative Agent May Perform. If any Grantor fails to perform
any agreement contained herein after any applicable cure period, the
Administrative Agent may itself perform, or cause performance of, such
agreement, and the reasonable expenses of the Administrative Agent incurred in
connection therewith shall be payable by such Grantor pursuant to Section 6.2.
5.3 Administrative Agent Has No Duty.
(a) In addition to, and not in limitation of, Section 2.4, the
powers conferred on the Administrative Agent hereunder are solely to protect its
interest (on behalf of the Secured Parties) in the Collateral and shall not
impose any duty or obligation on it to exercise any such powers. Neither the
Administrative Agent nor any of its officers, directors, employees or agents
shall be liable for failure to demand, collect or realize upon any of the
Collateral or for any delay in doing so or shall be under any obligation to sell
or otherwise dispose of any Collateral upon the request of any Grantor or any
other Person or to take any other action whatsoever with regard to the
Collateral or any part thereof (including the taking of any necessary steps to
preserve rights against prior parties or any other rights pertaining to any
Collateral). Neither the Administrative Agent nor any of its officers,
directors, employees or agents shall be responsible to any Grantor for any act
or failure to act hereunder, except for their own gross negligence or willful
misconduct.
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(b) Each Grantor assumes all responsibility and liability
arising from or relating to the use, sale or other disposition of the
Collateral. The Secured Obligations shall not be affected by any failure of the
Administrative Agent to take any steps to perfect the security interest granted
hereunder or to collect or realize upon the Collateral, nor shall loss of or
damage to the Collateral release any Grantor from any of its Secured
Obligations.
ARTICLE VI
REMEDIES
6.1 Certain Remedies. If any Event of Default shall have
occurred and be continuing:
(a) The Administrative Agent may exercise in respect of the
Collateral, in addition to other rights and remedies provided for herein or
otherwise available to it, all the rights and remedies of a secured party on
default under the UCC and also may take the following actions:
(i) require each Grantor to, and each Grantor hereby
agrees that it will, at its expense and upon the request of the Administrative
Agent forthwith, assemble all or part of the Collateral as directed by the
Administrative Agent and make it available to the Administrative Agent at its
premises or another place designated by the Administrative Agent (whether or not
the UCC applies to the affected Collateral);
(ii) without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by referred to below) to or upon any Grantor or any other Person (all
and each of which demands, defenses, advertisements and notices are hereby
waived), sell, lease, assign, give option or options to purchase, or otherwise
dispose of and deliver the Collateral or any part thereof (or contract to do any
of the foregoing), in one or more parcels at public or private sale, at any of
the Administrative Agent's offices or elsewhere, for cash, on credit or for
future delivery, and upon such other terms as the Administrative Agent may deem
commercially reasonable. Each Grantor agrees that, to the extent notice of sale
shall be required by Law, at least ten days' prior notice to such Grantor of the
time and place of any public sale or the time after which any private sale is to
be made shall constitute reasonable notification. The Administrative Agent shall
not be obligated to make any sale of Collateral regardless of notice of sale
having been given. The Administrative Agent may adjourn any public or private
sale from time to time by announcement at the time and place fixed therefor, and
such sale may, without further notice, be made at the time and place to which it
was so adjourned;
(iii) with or without legal process and with or without
prior notice or demand for performance, to take possession of the Collateral and
without liability for trespass to enter any premises where the Collateral may be
located for the purpose of taking possession of or removing the Collateral.
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(b) All cash proceeds received by the Administrative Agent in
respect of any sale of, collection from, or other realization upon all or any
part of the Collateral may, in the discretion of the Administrative Agent, be
held, to the extent permitted under applicable Law, by the Administrative Agent
as additional collateral security for all or any part of the Secured
Obligations, and/or then or at any time thereafter shall be applied (after
payment of any amounts payable to the Administrative Agent pursuant to Section
10.04 of the Credit Agreement and Section 6.2 below) in whole or in part by the
Administrative Agent for the ratable benefit of the Secured Parties against all
or any part of the Secured Obligations in accordance with Section 8.03 of the
Credit Agreement. Any surplus of such cash or cash proceeds held by the
Administrative Agent and remaining after payment in full of all the Secured
Obligations, and the termination of all Commitments, shall be paid over to the
Grantors or to whomsoever may be lawfully entitled to receive such surplus.
(c) The Administrative Agent may exercise any and all rights
and remedies of each Grantor under or in connection with the Collateral,
including the right to xxx upon or otherwise collect, extend the time for
payment of, modify or amend the terms of, compromise or settle for cash, credit,
or otherwise upon any terms, grant other indulgences, extensions, renewals,
compositions, or releases, and take or omit to take any other action with
respect to the Collateral, any security therefor, any agreement relating
thereto, any insurance applicable thereto, or any Person liable directly or
indirectly in connection with any of the foregoing, without discharging or
otherwise affecting the liability of any Grantor for the Obligations or under
this Agreement or any other Loan Document and the Material Contracts or
otherwise in respect of the Collateral, including any and all rights of such
Grantor to demand or otherwise require payment of any amount under, or
performance of any provision of, any Collateral.
The Administrative Agent shall give the Grantors 10 days' written notice (which
each Grantor agrees is reasonable notice within the meaning of Section 9-612 of
the UCC) of the Administrative Agent's intention to make any sale of Collateral.
Such notice, in the case of a public sale, shall state the time and place for
such sale and, in the case of a sale at a broker's board or on a securities
exchange, shall state the board or exchange at which such sale is to be made and
the day on which the Collateral, or portion thereof, will first be offered for
sale at such board or exchange. Any such public sale shall be held at such time
or times within ordinary business hours and at such place or places as the
Administrative Agent may fix and state in the notice (if any) of such sale. At
any such sale, the Collateral, or portion thereof, to be sold may be sold in one
lot as an entirety or in separate parcels, as the Administrative Agent may (in
its sole and absolute discretion) determine. The Administrative Agent shall not
be obligated to make any sale of any Collateral if it shall determine not to do
so, regardless of the fact that notice of sale of such Collateral shall have
been given. The Administrative Agent may, without notice or publication adjourn
any public or private sale or cause the same to be adjourned from time to time
by announcement at the time and place fixed for sale, and such sale may, without
further notice, be made at the time and place to which the same was so
adjourned. In case any sale of all or any part of the Collateral is made on
credit or for future delivery, the Collateral so sold may be retained by the
Administrative Agent until the sale price is paid by the purchaser or purchasers
thereof, but the Administrative Agent shall not incur any liability in case any
such purchaser or purchasers shall fail to take up and pay for the Collateral so
sold and, in case of any such failure, such Collateral may be sold again upon
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like notice. At any public (or, to the extent permitted by Law, private) sale
made pursuant to this Section, any Secured Party may bid for or purchase, free
(to the extent permitted by Law) from any right of redemption, stay, valuation
or appraisal on the part of any Grantor (all said rights being also hereby
waived and released to the extent permitted by Law), the Collateral or any part
thereof offered for sale and may make payment on account thereof by using any
claim then due and payable to such Secured Party from any Grantor as a credit
against the purchase price, and such Secured Party may upon compliance with the
terms of sale, hold, retain and dispose of such property without further
accountability to any Grantor therefor. The Secured Obligations shall not be
affected by any failure of the Administrative Agent to take any steps to perfect
the security interest granted hereunder or to collect or realize upon the
Collateral, nor shall loss or damage to the Collateral release any Grantor from
any of its Secured Obligations.
6.2 Indemnity and Expenses. Each Grantor agrees to jointly and
severally indemnify and hold harmless the Administrative Agent (and any
sub-agent thereof), each other Secured Party, and each Related Party of any of
the foregoing Persons (each, such Person being called an "Indemnitee") against,
and hold each harmless from, any and all losses, claims, damages, liabilities,
and related expenses (including the fees, charges and disbursements of any
counsel for any Indemnitee) incurred by any Indemnitee or asserted against any
Indemnitee by a third party or by the Borrower or any other Loan Party arising
out of, in connection with, or as a result of, this Agreement and the other Loan
Documents (including enforcement of this Agreement and other Loan Documents;
provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities and related expenses
(x) are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee or (y) result from a claim brought by a Loan Party
against an Indemnitee for breach in bad faith of such Indemnitee's obligations
hereunder or under any other Loan Document, if such Loan Party has obtained a
final and nonappealable judgment in its favor of such claim as determined by a
court of competent jurisdiction. Each Grantor will upon demand pay to the
Administrative Agent the amount of any and all reasonable expenses, including
the reasonable fees and disbursements of any experts and agents, which the
Administrative Agent may incur in connection with the following:
(a) the administration of this Agreement and the other Loan
Documents;
(b) the custody, preservation, use or operation of, or the
sale of, collection from, or other realization upon, any of the Collateral;
(c) the exercise or enforcement of any of the rights of the
Administrative Agent or the Secured Parties hereunder; or
(d) the failure by any Grantor to perform or observe any of
the provisions hereof.
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The agreements in this Section 6.2 shall survive the termination of the
Commitments and the repayment, satisfaction or discharge of the other
Obligations.
6.3 Waivers. Each Grantor hereby waives any right, to the extent
permitted by applicable Law, to receive prior notice of or a judicial or other
hearing with respect to any action or prejudgment remedy or proceeding by the
Administrative Agent to take possession, exercise control over or dispose of any
item of Collateral where such action is permitted under the terms of this
Agreement or any other Loan Document or by applicable Laws or the time, place or
terms of sale in connection with the exercise of the Administrative Agent's
rights hereunder. Each Grantor waives, to the extent permitted by applicable
Laws, any bonds, security or sureties required by the Administrative Agent with
respect to any of the Collateral. Each Grantor also waives any damages (direct,
consequential or otherwise) occasioned by the enforcement of the Administrative
Agent's rights under this Agreement or any other Loan Document, including, the
taking of possession of any Collateral or the giving of notice to any Account
Debtor or the collection of any Receivables Collateral, all to the extent that
such waiver is permitted by applicable Laws. Each Grantor also consents that the
Administrative Agent, in connection with the enforcement of the Administrative
Agent's rights and remedies under this Agreement, may enter upon any premises
owned by or leased to it without obligations to pay rent or for use and
occupancy, through self-help, without judicial process and without having first
obtained an order of any court. These waivers and all other waivers provided for
in this Agreement and the other Loan Documents have been negotiated by the
parties and each Grantor acknowledges that it has been represented by counsel of
its own choice and has consulted such counsel with respect to its rights
hereunder.
ARTICLE VII
MISCELLANEOUS PROVISIONS
7.1 Loan Document.
(a) This Agreement is a Loan Document executed pursuant to the
Credit Agreement and shall (unless otherwise expressly indicated herein) be
construed, administered and applied in accordance with the terms and provisions
thereof.
(b) Concurrently herewith certain of the Grantors are
executing and delivering the Pledge Agreement pursuant to which such Grantor is
pledging all the certificated Investment Property and Instruments of such
Grantor. Such pledges shall be governed by the terms of the Pledge Agreement and
not by this Agreement.
7.2 Amendments, etc.; Additional Grantors; Successors and Assigns.
(a) No amendment to or waiver of any provision of this
Agreement nor consent to any departure by any Grantor herefrom, shall in any
event be effective unless the same shall be in writing and signed by the
Administrative Agent and, with respect to any such amendment, by the Grantors,
and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
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(b) Upon the execution and delivery by any Person of a Joinder
Agreement, (i) such Person shall be referred to as an "Additional Grantor" and
shall be and become a Grantor, and each reference in this Agreement to "Grantor"
shall also mean and be a reference to such Additional Grantor and (ii) the
schedule supplements attached to each Security Agreement shall be incorporated
into and become a part of and supplement Schedules I and II hereto, as
appropriate, and the Administrative Agent may attach such schedule supplements
to such Schedules, and each reference to such Schedules shall mean and be a
reference to such Schedules, as supplemented pursuant hereto.
(c) Upon the delivery by the Borrower of each certificate of
Responsible Officers certifying supplements to the Schedules to this Agreement
pursuant to Section 4.15, the schedule supplements attached to each such
certificate shall be incorporated into and become a part of and supplement
Schedules I and II hereto, as appropriate, and the Administrative Agent may
attach such schedule supplements to such Schedules, and each reference to such
Schedules shall mean and be a reference to such Schedules, as supplemented
pursuant hereto.
(d) This Agreement shall be binding upon each Grantor and its
successors, transferees and assigns and shall inure to the benefit of the
Administrative Agent and each other Secured Party and their respective
successors, transferees and assigns; provided, however, that no Grantor may
assign its obligations hereunder without the prior written consent of the
Administrative Agent.
7.3 Addresses for Notices. All notices and other communications
provided for hereunder shall be in writing and mailed, delivered or transmitted
by telecopier to each party hereto at the address set forth in Section 10.02 of
the Credit Agreement (with any notice to a Grantor other than the Borrower being
delivered to such Grantor in care of the Borrower). All such notices and other
communications shall be deemed to be given or made at the times provided in
Section 10.02 of the Credit Agreement.
7.4 Section Captions. Section captions used in this Agreement are for
convenience of reference only, and shall not affect the construction of this
Agreement.
7.5 Severability. If any provision of this Agreement is held to be
illegal, invalid or unenforceable, (a) the legality, validity and enforceability
of the remaining provisions of this Agreement shall not be affected or impaired
thereby and (b) the parties shall endeavor in good faith negotiations to replace
the illegal, invalid or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the illegal,
invalid or unenforceable provisions. The invalidity of a provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
7.6 Counterparts. This Agreement may be executed in counterparts (and
by different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract.
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7.7 Governing Law, Etc.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND PERFORMED ENTIRELY WITHIN SUCH STATE, 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; PROVIDED THAT THE ADMINISTRATIVE AGENT SHALL
RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) EACH GRANTOR IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR
ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT
COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY
THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
COLLATERAL OR OTHER PROPERTY SHALL 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 PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE
PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING
SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE
JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN
ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT OR
ANY OTHER SECURED PARTY HERETO MAY OTHERWISE HAVE TO BRING ANY ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST ANY
GRANTOR OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.
(c) EACH GRANTOR IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED
TO IN PARAGRAPH (b) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY
-28-
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE
DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT.
(d) EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 7.3. NOTHING IN THIS
AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.
7.8 Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
7.9 Entire Agreement. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES
OR BY PRIOR OR CONTEMPORANEOUS WRITTEN AGREEMENTS. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG THE PARTIES.
[Signature Page Follows]
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IN WITNESS WHEREOF, each Grantor has caused this Agreement to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
INTEGRA LIFESCIENCES HOLDINGS CORPORATION,
a Delaware corporation
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Senior Vice President, Finance
INTEGRA LIFESCIENCES CORPORATION, a
Delaware corporation
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Senior Vice President, Finance
INTEGRA LIFESCIENCES INVESTMENT
CORPORATION, a Delaware corporation
By: Xxxxx X. Xxxxx
------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
INTEGRA OHIO, INC., a Delaware corporation
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
INTEGRA MASSACHUSETTS, INC., a Delaware
corporation
By: Xxxxx X. Xxxxx
------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice Preisdent and Treasurer
INTEGRA CLINICAL EDUCATION INSTITUTE, INC.,
a Delaware corporation
By: Xxxxx X. Xxxxx
------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
INTEGRA HEALTHCARE PRODUCTS LLC , a
Delaware limited liability company
By: Integra LifeSciences Corporation, its
sole member
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
X. XXXXXX SURGICAL INSTRUMENTS, INC., a
Delaware corporation
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
JARIT INSTRUMENTS, INC., a Delaware
corporation
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
INTEGRA SELECTOR CORPORATION, a Delaware
corporation
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
INTEGRA NEUROSCIENCES PR, INC., a Delaware
corporation
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
SPINAL SPECIALTIES, INC., a Delaware
corporation
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
INTEGRA NEUROSCIENCES (IP), INC., a
Delaware corporation
By: Xxxxx X. Xxxxx
------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
INTEGRA NEUROSCIENCES (INTERNATIONAL),
INC., a Delaware corporation
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
INTEGRA LIFESCIENCES (FRANCE) LLC, a
Delaware limited liability company
By: Integra NeuroSciences
(International), Inc., its sole member
By: Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and Treasurer
ACKNOWLEDGED AND ACCEPTED:
BANK OF AMERICA, N.A.,
as Administrative Agent
By: /s/ Xxxx X. Xxxxxxx
-----------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
