EXHIBIT 10.44
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Security Agreement") is entered into as
of December 31, 2001 among THE PROFIT RECOVERY GROUP USA, INC., a Georgia
corporation (the "Borrower"), THE PROFIT RECOVERY GROUP INTERNATIONAL, INC., a
Georgia corporation (the "Parent"), certain of the Domestic Subsidiaries of the
Parent (such Domestic Subsidiaries, together with the Parent, individually a
"Guarantor" and collectively the "Guarantors"; the Guarantors together with the
Borrower, individually an "Obligor", and collectively the "Obligors") and BANK
OF AMERICA, N.A., in its capacity as administrative agent (in such capacity, the
"Administrative Agent") for the lenders from time to time party to the Credit
Agreement described below (the "Lenders").
RECITALS
WHEREAS, pursuant to that certain Credit Agreement, dated as of the
date hereof (as amended, modified, extended, renewed or replaced from time to
time, the "Credit Agreement"), among the Borrower, the Guarantors, the Lenders
and the Administrative Agent, the Lenders have agreed to make Loans and issue
Letters of Credit upon the terms and subject to the conditions set forth
therein; and
WHEREAS, it is a condition precedent to the effectiveness of the Credit
Agreement and the obligations of the Lenders to make their respective Loans and
to issue Letters of Credit under the Credit Agreement that the Obligors shall
have executed and delivered this Security Agreement to the Administrative Agent
for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Definitions.
(a) Unless otherwise defined herein, capitalized terms
used herein shall have the meanings ascribed to such terms in the
Credit Agreement, and the following terms which are defined in the
Uniform Commercial Code in effect in the State of Georgia on the date
hereof are used herein as so defined: Accession, Account, As-Extracted
Collateral, Chattel Paper, Commercial Tort Claim, Commingled Goods,
Consumer Goods, Deposit Account, Document, Equipment, Farm Products,
Fixtures, General Intangible, Goods, Instrument, Inventory, Investment
Property, Letter-of-Credit Right, Proceeds, Software, Supporting
Obligation and Tangible Chattel Paper. For purposes of this Security
Agreement, the term "Lender" shall include any Affiliate of any Lender
which has entered into a Hedging Agreement with any Credit Party in
connection with the Loans.
(b) In addition, the following terms shall have the
following meanings:
"Copyright Licenses": any written agreement, naming any
Obligor as licensor, granting any right under any Copyright including,
without limitation, any thereof referred to in Schedule 6.17 to the
Credit Agreement.
"Copyrights": (a) all registered United States copyrights in
all Works, now existing or hereafter created or acquired, all
registrations and recordings thereof, and all applications in
connection therewith, including, without limitation, registrations,
recordings and applications in the United States Copyright office
including, without limitation, any thereof referred to in Schedule 6.17
to the Credit Agreement, and (b) all renewals thereof including,
without limitation, any thereof referred to in Schedule 6.17 of the
Credit Agreement.
"Patent License": all agreements, whether written or oral,
providing for the grant by or to an Obligor of any right to
manufacture, use or sell any invention covered by a Patent, including,
without limitation, any thereof referred to in Schedule 6.17 of the
Credit Agreement.
"Patents": (a) all letters patent of the United States or any
other country and all reissues and extensions thereof, including,
without limitation, any thereof referred to in Schedule 6.17 of the
Credit Agreement, and (b) all applications for letters patent of the
United States or any other country and all divisions, continuations and
continuations-in-part thereof, including, without limitation, any
thereof referred to in Schedule 6.17 of the Credit Agreement.
"Secured Obligations": the collective reference to all of the
Credit Party Obligations, now existing or hereafter arising pursuant to
the Credit Documents, owing from the Borrower or any other Credit Party
to any Lender or the Administrative Agent, howsoever evidenced,
created, incurred or acquired, whether primary, secondary, direct,
contingent, or joint and several, including, without limitation, all
obligations and liabilities incurred in connection with collecting and
enforcing the foregoing.
"Trademark License": means any agreement, written or oral,
providing for the grant by or to an Obligor of any right to use any
Trademark, including, without limitation, any thereof referred to in
Schedule 6.17 of the Credit Agreement.
"Trademarks": (a) all trademarks, trade names, corporate
names, company names, business names, fictitious business names, trade
styles, service marks, logos and other source or business identifiers,
and the goodwill associated therewith, now existing or hereafter
adopted or acquired, all registrations and recordings thereof, and all
applications in connection therewith, whether in the United States
Patent and Trademark Office or in any similar office or agency of the
United States, any State thereof or any other country or any political
subdivision thereof, or otherwise, including, without limitation, any
thereof referred to in Schedule 6.17 to the Credit Agreement, and (b)
all renewals thereof.
"Work": any work which is subject to copyright protection
pursuant to Title 17 of the United States Code.
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2. Grant of Security Interest in the Collateral. To secure the
prompt payment and performance in full when due, whether by lapse of time,
acceleration, mandatory prepayment or otherwise, of the Secured Obligations,
each Obligor hereby grants to the Administrative Agent, for the benefit of the
Lenders, a continuing security interest in, and a right to set off against, any
and all right, title and interest of such Obligor in and to all personal
property of such Obligor of whatever type or description, whether now owned or
existing or owned, acquired, or arising hereafter, including, without
limitation, the following (collectively, the "Collateral"):
(a) all Accounts;
(b) all cash and currency;
(c) all Chattel Paper;
(d) all Commercial Tort Claims identified on Schedule
2(d) attached hereto;
(e) all Copyrights;
(f) all Copyright Licenses;
(g) all Deposit Accounts;
(h) all Documents;
(i) all Equipment;
(j) all Fixtures;
(k) all General Intangibles;
(l) all Instruments;
(m) all Inventory;
(n) all Investment Property;
(o) all Letter-of-Credit Rights;
(p) all Patents;
(q) all Patent Licenses;
(r) all Software;
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(s) all Supporting Obligations;
(t) all Trademarks;
(u) all Trademark Licenses; and
(v) to the extent not otherwise included, all Accessions
and all Proceeds of any and all of the foregoing.
The Obligors and the Administrative Agent, on behalf of the Lenders,
hereby acknowledge and agree that the security interest created hereby in the
Collateral (i) constitutes continuing collateral security for all of the Secured
Obligations, whether now existing or hereafter arising and (ii) is not to be
construed as an assignment of any Copyrights, Copyright Licenses, Patents,
Patent Licenses, Trademarks or Trademark Licenses.
3. Provisions Relating to Accounts.
(a) Anything herein to the contrary notwithstanding, each
of the Obligors shall remain liable under each of the Accounts to
observe and perform all the conditions and obligations to be observed
and performed by it thereunder, all in accordance with the terms of any
agreement giving rise to each such Account. Neither the Administrative
Agent nor any Lender shall have any obligation or liability under any
Account (or any agreement giving rise thereto) by reason of or arising
out of this Security Agreement or the receipt by the Administrative
Agent or any Lender of any payment relating to such Account pursuant
hereto, nor shall the Administrative Agent or any Lender be obligated
in any manner to perform any of the obligations of an Obligor under or
pursuant to any Account (or any agreement giving rise thereto), to make
any payment, to make any inquiry as to the nature or the sufficiency of
any payment received by it or as to the sufficiency of any performance
by any party under any Account (or any agreement giving rise thereto),
to present or file any claim, to take any action to enforce any
performance or to collect the payment of any amounts which may have
been assigned to it or to which it may be entitled at any time or
times.
(b) Once during each calendar year or at any time after
the occurrence and during the continuation of an Event of Default, the
Administrative Agent shall have the right, but not the obligation, to
make test verifications of the Accounts in any manner and through any
medium that it reasonably considers advisable, and the Obligors shall
furnish all such assistance and information as the Administrative Agent
may require in connection with such test verifications. At any time and
from time to time, upon the Administrative Agent's reasonable request
and at the expense of the Obligors, the Obligors shall cause
independent public accountants or others satisfactory to the
Administrative Agent to furnish to the Administrative Agent reports
showing reconciliations, aging and test verifications of, and trial
balances for, the Accounts. The Administrative Agent in its own name or
in the name of others may communicate with account debtors on the
Accounts to verify with them
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to the Administrative Agent's reasonable satisfaction the existence,
amount and terms of any Accounts.
4. Representations and Warranties. Each Obligor hereby represents
and warrants to the Administrative Agent, for the benefit of the Lenders, that
so long as any of the Secured Obligations remain outstanding or any Credit
Document or any Hedging Agreement between any Credit Party and any Lender in
connection with the Loans is in effect or any Letter of Credit shall remain
outstanding, and until all of the Commitments shall have been terminated:
(a) Legal Name; Chief Executive Office.
(i) Each Obligor's exact legal name, state of
incorporation or formation, principal place of business and
chief executive office are (and for the four months prior to
the date hereof has been) as set forth on Schedule 4(a)(i)
attached hereto.
(ii) Other than as set forth on Schedule 4(a)(ii)
attached hereto, no Obligor has been party to a merger,
consolidation or other change in structure or used any
tradename in the four months prior to the date hereof.
(b) Ownership. Each Obligor is the legal and beneficial
owner of its Collateral and has the right to pledge, sell, assign or
transfer the same.
(c) Security Interest/Priority. This Security Agreement
creates a valid security interest in favor of the Administrative Agent,
for the benefit of the Lenders, in the Collateral of such Obligor and,
when properly perfected by filing, shall constitute a valid perfected
security interest in such Collateral, to the extent such security can
be perfected by filing under the UCC, free and clear of all Liens
except for Permitted Liens.
(d) Types of Collateral. None of the Collateral consists
of, or is the Accessions or the Proceeds of, As-Extracted Collateral,
Consumer Goods or Farm Products.
(e) Accounts. (i) Each Account of the Obligors and the
papers and documents relating thereto are genuine and in all material
respects what they purport to be, (ii) each Account arises out of (A) a
bona fide sale of goods sold and delivered by such Obligor (or is in
the process of being delivered) or (B) services theretofore actually
rendered by such Obligor to, the account debtor named therein, (iii) no
Account of an Obligor is evidenced by any Instrument or Chattel Paper
unless such Instrument or Chattel Paper has been theretofore endorsed
over and delivered to, or submitted to the control of, the
Administrative Agent and (iv) no surety bond was required or given in
connection with any Account of an Obligor or the contracts or purchase
orders out of which they arose.
(f) Inventory. No Inventory is held by an Obligor
pursuant to consignment, sale or return, sale on approval or similar
arrangement.
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(g) Copyrights, Patents and Trademarks.
(i) Schedule 6.17 to the Credit Agreement
includes all Copyrights, Copyright Licenses, Patents, Patent
Licenses, Trademarks and Trademark Licenses owned by any
Obligor in its own name, or to which any Obligor is party, as
of the date hereof.
(ii) To the best of each Obligor's knowledge,
each Copyright, Patent and Trademark of such Obligor is valid,
subsisting, unexpired, enforceable and has not been abandoned.
(iii) Except as set forth in Schedule 6.17 to the
Credit Agreement, none of such Copyrights, Patents and
Trademarks is the subject of any licensing or franchise
agreement.
(iv) No holding, decision or judgment has been
rendered by any Governmental Authority which would limit,
cancel or question the validity of any Copyright, Patent or
Trademark.
(v) No action or proceeding is pending seeking
to limit, cancel or question the validity of any Copyright,
Patent or Trademark, or which, if adversely determined, would
have a material adverse effect on the value of any Copyright,
Patent or Trademark.
(vi) All applications pertaining to the
Copyrights, Patents and Trademarks of each Obligor have been
duly and properly filed, and all registrations or letters
pertaining to such Copyrights, Patents and Trademarks have
been duly and properly filed and issued, and all of such
Copyrights, Patents and Trademarks are valid and enforceable.
(vii) No Obligor has made any assignment or
agreement in conflict with the security interest in the
Copyrights, Patents or Trademarks of each Obligor hereunder.
5. Covenants. Each Obligor covenants that, so long as any of the
Secured Obligations remain outstanding or any Credit Document or any Hedging
Agreement between any Credit Party and any Lender in connection with the Loans
is in effect or any Letter of Credit shall remain outstanding, and until all of
the Commitments shall have been terminated, such Obligor shall:
(a) Other Liens. Defend the Collateral against the claims
and demands of all other parties claiming an interest therein, keep the
Collateral free from all Liens, except for Permitted Liens, and not
sell, exchange, transfer, assign, lease or otherwise dispose of the
Collateral or any interest therein, except as permitted under the
Credit Agreement.
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(b) Preservation of Collateral. Keep the Collateral in
good order, condition and repair and not use the Collateral in
violation of the provisions of this Security Agreement or any other
agreement relating to the Collateral or any policy insuring the
Collateral or any applicable statute, law, bylaw, rule, regulation or
ordinance.
(c) Instruments/Tangible Chattel Paper/Documents. If any
amount payable under or in connection with any of the Collateral shall
be or become evidenced by any Instrument or Tangible Chattel Paper, or
if any property constituting Collateral shall be stored or shipped
subject to a Document, such Obligor shall ensure than such Instrument,
Tangible Chattel Paper or Document is either in the possession of such
Obligor at all times or, if requested by the Administrative Agent, is
immediately delivered to the Administrative Agent, duly endorsed in a
manner satisfactory to the Administrative Agent. Such Obligor shall
ensure that any Collateral consisting of Tangible Chattel Paper is
marked with a legend acceptable to the Administrative Agent indicating
the Administrative Agent's security interest in such Tangible Chattel
Paper.
(d) Change in Structure, Location or Type. Not, without
providing 10 days prior written notice to the Administrative Agent and
without filing such financing statements and amendments to any
previously filed financing statements as the Administrative Agent may
require, change its name or state of formation or be party to a merger,
consolidation or other change in structure or use any tradename.
(e) Inspection. Upon reasonable notice, and during
reasonable hours, at all times allow the Administrative Agent or its
representatives to visit and inspect the Collateral as set forth in
Section 7.10 of the Credit Agreement.
(f) Authorization. Authorize the Administrative Agent to
prepare and file such financing statements (including renewal
statements), amendments and supplements or such other instruments as
the Administrative Agent may from time to time reasonably deem
necessary, appropriate or convenient in order to perfect and maintain
the security interests granted hereunder in accordance with the UCC.
(g) Perfection of Security Interest. Execute and deliver
to the Administrative Agent such agreements, assignments or instruments
(including affidavits, notices, reaffirmations and amendments and
restatements of existing documents, as the Administrative Agent may
reasonably request) and do all such other things as the Administrative
Agent may reasonably deem necessary or appropriate (i) to assure to the
Administrative Agent its security interests hereunder, including (A)
such financing statements (including renewal statements) or amendments
thereof or supplements thereto or other instruments as the
Administrative Agent may from time to time reasonably request in order
to perfect and maintain the security interests granted hereunder in
accordance with the UCC, (B) with regard to Copyrights, a Notice of
Grant of Security Interest in Copyrights for filing with the United
States Copyright Office in the form of Schedule 5(f)(i) attached
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hereto, (C) with regard to Patents, a Notice of Grant of Security
Interest in Patents for filing with the United States Patent and
Trademark Office in the form of Schedule 5(f)(ii) attached hereto and
(D) with regard to Trademarks, a Notice of Grant of Security Interest
in Trademarks for filing with the United States Patent and Trademark
Office in the form of Schedule 5(f)(iii) attached hereto, (ii) to
consummate the transactions contemplated hereby and (iii) to otherwise
protect and reasonably assure the Administrative Agent of its rights
and interests hereunder. To that end, each Obligor agrees that the
Administrative Agent may file one or more financing statements
disclosing the Administrative Agent's security interest in any or all
of the Collateral of such Obligor without, to the extent permitted by
law, such Obligor's signature thereon, and further each Obligor also
hereby irrevocably makes, constitutes and appoints the Administrative
Agent, its nominee or any other person whom the Administrative Agent
may designate, as such Obligor's attorney in fact with full power and
for the limited purpose to sign in the name of such Obligor any such
financing statements, or amendments and supplements to financing
statements, renewal financing statements, notices or any similar
documents which in the Administrative Agent's reasonable discretion
would be necessary, appropriate or convenient in order to perfect and
maintain perfection of the security interests granted hereunder, such
power, being coupled with an interest, being and remaining irrevocable
and in effect so long as the Credit Agreement is in effect or any
amounts payable thereunder or under any other Credit Document, any
Letter of Credit or any Hedging Agreement between any Credit Party and
any Lender in connection with the Loans shall remain outstanding, and
until all of the Commitments thereunder shall have terminated. Each
Obligor hereby agrees that a carbon, photographic or other reproduction
of this Security Agreement or any such financing statement is
sufficient for filing as a financing statement by the Administrative
Agent without notice thereof to such Obligor wherever the
Administrative Agent may in its reasonable discretion desire to file
the same. In the event for any reason the law of any jurisdiction other
than Georgia becomes or is applicable to the Collateral of any Obligor
or any part thereof, or to any of the Secured Obligations, such Obligor
agrees to execute and deliver all such instruments and to do all such
other things as the Administrative Agent in its sole discretion
reasonably deems necessary or appropriate to preserve, protect and
enforce the security interests of the Administrative Agent under the
law of such other jurisdiction (and, if an Obligor shall fail to do so
promptly upon the request of the Administrative Agent, then the
Administrative Agent may execute any and all such requested documents
on behalf of such Obligor pursuant to the power of attorney granted
hereinabove). If any Collateral is in the possession or control of an
Obligor's agents and the Administrative Agent so requests, such Obligor
agrees to notify such agents in writing of the Administrative Agent's
security interest therein and, upon the Administrative Agent's request,
instruct them to hold all such Collateral for the Lenders' account and
subject to the Administrative Agent's instructions. Each Obligor agrees
to xxxx its books and records to reflect the security interest of the
Administrative Agent in the Collateral.
(h) Control. Execute and deliver all agreements,
assignments, instruments or other documents as the Administrative Agent
shall reasonably request for the purpose of obtaining and maintaining
control within the meaning of the UCC with respect to any Collateral
consisting of Deposit Accounts, Investment Property, Letter-of-Credit
Rights and Electronic Chattel Paper.
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(i) Collateral held by Warehouseman, Bailee, etc. If any
Collateral is at any time in the possession or control of a
warehouseman, bailee, agent or processor of such Obligor, (i) notify
the Administrative Agent of such possession or control, (ii) notify
such Person of the Administrative Agent's security interest in such
Collateral, (iii) instruct such Person to hold all such Collateral for
the Administrative Agent's account and subject to the Administrative
Agent's instructions and (iv) use its best efforts to obtain an
acknowledgment from such Person that it is holding such Collateral for
the benefit of the Administrative Agent.
(j) Treatment of Accounts. Not grant or extend the time
for payment of any Account, or compromise or settle any Account for
less than the full amount thereof, or release any person or property,
in whole or in part, from payment thereof, or allow any credit or
discount thereon, other than as normal and customary in the ordinary
course of an Obligor's business.
(k) Covenants Relating to Copyrights.
(i) Employ the Copyright for each Work
with such notice of copyright as may be required by
law to secure copyright protection.
(ii) Not do any act or knowingly omit to
do any act whereby any material Copyright may become
invalidated and (A) not do any act, or knowingly omit
to do any act, whereby any material Copyright may
become injected into the public domain; (B) notify
the Administrative Agent immediately if it knows that
any material Copyright may become injected into the
public domain or of any adverse determination or
development (including, without limitation, the
institution of, or any such determination or
development in, any court or tribunal in the United
States or any other country) regarding an Obligor's
ownership of any such Copyright or its validity; (C)
take all necessary steps as it shall deem appropriate
under the circumstances, to maintain and pursue each
application (and to obtain the relevant registration)
and to maintain each registration of each material
Copyright owned by an Obligor including, without
limitation, filing of applications for renewal where
necessary; and (D) promptly notify the Administrative
Agent of any material infringement of any material
Copyright of an Obligor of which it becomes aware and
take such actions as it shall reasonably deem
appropriate under the circumstances to protect such
Copyright, including, where appropriate, the bringing
of suit for infringement, seeking injunctive relief
and seeking to recover any and all damages for such
infringement.
(iii) Not make any assignment or
agreement in conflict with the security interest in
the Copyrights of each Obligor hereunder.
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(l) Covenants Relating to Patents and Trademarks.
(i) (A) Continue to use each Trademark
on each and every trademark class of goods applicable
to its current line as reflected in its current
catalogs, brochures and price lists in order to
maintain such Trademark in full force free from any
claim of abandonment for non-use, (B) maintain as in
the past the quality of products and services offered
under such Trademark, (C) employ such Trademark with
the appropriate notice of registration, (D) not adopt
or use any xxxx which is confusingly similar or a
colorable imitation of such Trademark unless the
Administrative Agent, for the ratable benefit of the
Lenders, shall obtain a perfected security interest
in such xxxx pursuant to this Security Agreement, and
(E) not (and not permit any licensee or sublicensee
thereof to) do any act or knowingly omit to do any
act whereby any Trademark may become invalidated.
(ii) Not do any act, or omit to do any
act, whereby any Patent may become abandoned or
dedicated.
(iii) Notify the Administrative Agent and
the Lenders immediately if it knows that any
application or registration relating to any Patent or
Trademark may become abandoned or dedicated, or of
any adverse determination or development (including,
without limitation, the institution of, or any such
determination or development in, any proceeding in
the United States Patent and Trademark Office or any
court or tribunal in any country) regarding an
Obligor's ownership of any Patent or Trademark or its
right to register the same or to keep and maintain
the same.
(iv) Whenever an Obligor, either by
itself or through an agent, employee, licensee or
designee, shall file an application for the
registration of any Patent or Trademark with the
United States Patent and Trademark Office or any
similar office or agency in any other country or any
political subdivision thereof, an Obligor shall
report such filing to the Administrative Agent and
the Lenders within five Business Days after the last
day of the fiscal quarter in which such filing
occurs. Upon request of the Administrative Agent, an
Obligor shall execute and deliver any and all
agreements, instruments, documents and papers as the
Administrative Agent may reasonably request to
evidence the Administrative Agent's and the Lenders'
security interest in any Patent or Trademark and the
goodwill and general intangibles of an Obligor
relating thereto or represented thereby.
(v) Take all reasonable and necessary
steps, including, without limitation, in any
proceeding before the United States Patent and
Trademark Office, or any similar office or agency in
any other country or any political subdivision
thereof, to maintain and pursue each application (and
to obtain the relevant registration) and to maintain
each registration of the Patents and
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Trademarks, including, without limitation, filing of
applications for renewal, affidavits of use and
affidavits of incontestability.
(vi) Promptly notify the Administrative
Agent and the Lenders after it learns that any Patent
or Trademark included in the Collateral is infringed,
misappropriated or diluted by a third party and
promptly xxx for infringement, misappropriation or
dilution, to seek injunctive relief where appropriate
and to recover any and all damages for such
infringement, misappropriation or dilution, or take
such other actions as it shall reasonably deem
appropriate under the circumstances to protect such
Patent or Trademark.
(vii) Not make any assignment or
agreement in conflict with the security interest in
the Patents or Trademarks of each Obligor hereunder.
(m) New Patents, Copyrights and Trademarks. Promptly
provide the Administrative Agent with (i) a listing of all
applications, if any, for new Copyrights, Patents or Trademarks
(together with a listing of the issuance of registrations or letters on
present applications), which new applications and issued registrations
or letters shall be subject to the terms and conditions hereunder, and
(ii) (A) with respect to Copyrights, a duly executed Notice of Security
Interest in Copyrights, (B) with respect to Patents, a duly executed
Notice of Security Interest in Patents, (C) with respect to Trademarks,
a duly executed Notice of Security Interest in Trademarks or (D) such
other duly executed documents as the Administrative Agent may
reasonably request in a form acceptable to counsel for the
Administrative Agent and suitable for recording to evidence the
security interest in the Copyright, Patent or Trademark which is the
subject of such new application.
(n) Insurance. Insure, repair and replace the Collateral
of such Obligor as set forth in the Credit Agreement. All insurance
proceeds shall be subject to the security interest of the
Administrative Agent hereunder.
(o) Commercial Tort Claims.
(i) Promptly notify the Administrative Agent in
writing of the initiation of any Commercial Tort Claim before
any Governmental Authority by or in favor of such Obligor or
any of its Subsidiaries.
(ii) Execute and deliver such statements,
documents and notices and do and cause to be done all such
things as the Administrative Agent may reasonably deem
necessary, appropriate or convenient, or as are required by
law, to create, perfect and maintain the Administrative
Agent's security interest in any Commercial Tort Claim.
6. Advances by Lenders. On failure of any Obligor to perform any
of the covenants and agreements contained herein, the Administrative Agent may,
at its sole option and in its sole
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discretion, perform the same and in so doing may expend such sums as the
Administrative Agent may reasonably deem advisable in the performance thereof,
including, without limitation, the payment of any insurance premiums, the
payment of any taxes, a payment to obtain a release of a Lien or potential Lien,
expenditures made in defending against any adverse claim and all other
expenditures which the Administrative Agent or the Lenders may make for the
protection of the security hereof or which may be compelled to make by operation
of law. All such sums and amounts so expended shall be repayable by the Obligors
on a joint and several basis promptly upon timely notice thereof and demand
therefor, shall constitute additional Secured Obligations and shall bear
interest from the date said amounts are expended at the default rate specified
in Section 3.1 of the Credit Agreement for Revolving Loans that are Base Rate
Loans. No such performance of any covenant or agreement by the Administrative
Agent or the Lenders on behalf of any Obligor, and no such advance or
expenditure therefor, shall relieve the Obligors of any default under the terms
of this Security Agreement, the other Credit Documents or any Hedging Agreement
between any Credit Party and any Lender in connection with the Loans. The
Lenders may make any payment hereby authorized in accordance with any xxxx,
statement or estimate procured from the appropriate public office or holder of
the claim to be discharged without inquiry into the accuracy of such xxxx,
statement or estimate or into the validity of any tax assessment, sale,
forfeiture, tax lien, title or claim except to the extent such payment is being
contested in good faith by an Obligor in appropriate proceedings and against
which adequate reserves are being maintained in accordance with GAAP.
7. Events of Default.
The occurrence of an event which under the Credit Agreement would
constitute an Event of Default shall be an Event of Default hereunder (an "Event
of Default").
8. Remedies.
(a) General Remedies. Upon the occurrence of an Event of
Default and during continuation thereof, the Lenders shall have, in
addition to the rights and remedies provided herein, in the Credit
Documents, in any Hedging Agreement between any Credit Party and any
Lender in connection with the Loans or by law (including, but not
limited to, levy of attachment, garnishment, and the rights and
remedies set forth in the Uniform Commercial Code of the jurisdiction
applicable to the affected Collateral), the rights and remedies of a
secured party under the UCC (regardless of whether the UCC is the law
of the jurisdiction where the rights and remedies are asserted and
regardless of whether the UCC applies to the affected Collateral), and
further, the Administrative Agent may, with or without judicial process
or the aid and assistance of others, (i) enter on any premises on which
any of the Collateral may be located and, without resistance or
interference by the Obligors, take possession of the Collateral, (ii)
dispose of any Collateral on any such premises, (iii) require the
Obligors to assemble and make available to the Administrative Agent at
the expense of the Obligors any Collateral at any place and time
designated by the Administrative Agent which is reasonably convenient
to both parties, (iv) remove any Collateral from any such premises for
the purpose of effecting sale or other disposition thereof, and/or (v)
without demand and without advertisement, notice, hearing or process of
12
law, all of which each of the Obligors hereby waives to the fullest
extent permitted by law, at any place and time or times, sell and
deliver any or all Collateral held by or for it at public or private
sale, by one or more contracts, in one or more parcels, for cash, upon
credit or otherwise, at such prices and upon such terms as the
Administrative Agent deems advisable, in its sole discretion (subject
to any and all mandatory legal requirements). Neither the
Administrative Agent's compliance with applicable law nor its
disclaimer of warranties relating to the Collateral shall be considered
to adversely affect the commercial reasonableness of any sale. In
addition to all other sums due the Administrative Agent and the Lenders
with respect to the Secured Obligations, the Obligors shall pay the
Administrative Agent and each of the Lenders all reasonable documented
costs and expenses incurred by the Administrative Agent or any such
Lender, including, but not limited to, reasonable attorneys' fees and
court costs, in obtaining or liquidating the Collateral, in enforcing
payment of the Secured Obligations, or in the prosecution or defense of
any action or proceeding by or against the Administrative Agent or the
Lenders or the Obligors concerning any matter arising out of or
connected with this Security Agreement, any Collateral or the Secured
Obligations, including, without limitation, any of the foregoing
arising in, arising under or related to a case under the Bankruptcy
Code. To the extent the rights of notice cannot be legally waived
hereunder, each Obligor agrees that any requirement of reasonable
notice shall be met if such notice is personally served on or mailed,
postage prepaid, to the Borrower in accordance with the notice
provisions of Section 11.1 of the Credit Agreement at least 10 days
before the time of sale or other event giving rise to the requirement
of such notice. The Administrative Agent and the Lenders shall not be
obligated to make any sale or other disposition of the Collateral
regardless of notice having been given. To the extent permitted by law,
any Lender may be a purchaser at any such sale. To the extent permitted
by applicable law, each of the Obligors hereby waives all of its rights
of redemption with respect to any such sale. Subject to the provisions
of applicable law, the Administrative Agent and the Lenders may
postpone or cause the postponement of the sale of all or any portion of
the Collateral by announcement at the time and place of such sale, and
such sale may, without further notice, to the extent permitted by law,
be made at the time and place to which the sale was postponed, or the
Administrative Agent and the Lenders may further postpone such sale by
announcement made at such time and place.
(b) Remedies relating to Accounts. Upon the occurrence of
an Event of Default and during the continuation thereof, whether or not
the Administrative Agent has exercised any or all of its rights and
remedies hereunder, each Obligor will promptly upon request of the
Administrative Agent instruct all account debtors to remit all payments
in respect of Accounts to a mailing location selected by the
Administrative Agent. In addition, the Administrative Agent or its
designee shall have the right to enforce any Obligor's rights against
its customers and account debtors and may notify any Obligor's
customers and account debtors that the Accounts of such Obligor have
been assigned to the Administrative Agent or of the Administrative
Agent's security interest therein, and may (either in its own name or
in the name of an Obligor or both) demand, collect (including without
limitation by way of a lockbox arrangement), receive, take receipt for,
sell, xxx for, compound, settle, compromise and give acquittance for
any and all amounts due or to become due on any
13
Account, and, in the Administrative Agent's discretion, file any claim
or take any other action or proceeding to protect and realize upon the
security interest of the Lenders in the Accounts. Each Obligor
acknowledges and agrees that the Proceeds of its Accounts remitted to
or on behalf of the Administrative Agent in accordance with the
provisions hereof shall be solely for the Administrative Agent's own
convenience and that such Obligor shall not have any right, title or
interest in such Accounts or in any such other amounts except as
expressly provided herein. The Administrative Agent and the Lenders
shall have no liability or responsibility to any Obligor for acceptance
in good faith of a check, draft or other order for payment of money
bearing the legend "payment in full" or words of similar import or any
other restrictive legend or endorsement or be responsible for
determining the correctness of any remittance. Each Obligor hereby
agrees to indemnify the Administrative Agent and the Lenders from and
against all liabilities, damages, losses, actions, claims, judgments,
costs, expenses, charges and reasonable attorneys' fees suffered or
incurred by the Administrative Agent or the Lenders (each, an
"Indemnified Party") because of the maintenance of the foregoing
arrangements except as relating to or arising out of the gross
negligence or willful misconduct of an Indemnified Party or its
officers, employees or agents. In the case of any investigation,
litigation or other proceeding, the foregoing indemnity shall be
effective whether or not such investigation, litigation or proceeding
is brought by an Obligor, its directors, shareholders or creditors or
an Indemnified Party or any other Person or any other Indemnified Party
is otherwise a party thereto.
(c) Access. In addition to the rights and remedies
hereunder, upon the occurrence of an Event of Default and during the
continuance thereof, the Administrative Agent shall have the right to
enter and remain upon the various premises of the Obligors without cost
or charge to the Administrative Agent, and use the same, together with
materials, supplies, books and records of the Obligors for the purpose
of collecting and liquidating the Collateral, or for preparing for sale
and conducting the sale of the Collateral, whether by foreclosure,
auction or otherwise. In addition, the Administrative Agent may remove
Collateral, or any part thereof, from such premises and/or any records
with respect thereto, in order to effectively collect or liquidate such
Collateral.
(d) Nonexclusive Nature of Remedies. Failure by the
Administrative Agent or the Lenders to exercise any right, remedy or
option under this Security Agreement, any other Credit Document, any
Hedging Agreement between any Credit Party and any Lender in connection
with the Loans or as provided by law, or any delay by the
Administrative Agent or the Lenders in exercising the same, shall not
operate as a waiver of any such right, remedy or option. No waiver
hereunder shall be effective unless it is in writing, signed by the
party against whom such waiver is sought to be enforced and then only
to the extent specifically stated, which in the case of the
Administrative Agent or the Lenders shall only be granted as provided
herein. To the extent permitted by law, neither the Administrative
Agent, the Lenders, nor any party acting as attorney for the
Administrative Agent or the Lenders, shall be liable hereunder for any
acts or omissions or for any error of judgment or mistake of fact or
law other than their gross negligence or willful misconduct hereunder.
The rights and remedies of the Administrative Agent and the Lenders
under this Security
14
Agreement shall be cumulative and not exclusive of any other right or
remedy which the Administrative Agent or the Lenders may have.
(e) Retention of Collateral. The Administrative Agent
may, after providing the notices required by Sections 9-620 and 9-621
of the UCC or otherwise complying with the requirements of applicable
law of the relevant jurisdiction, accept or retain all or any portion
of the Collateral in satisfaction of the Secured Obligations. Unless
and until the Administrative Agent shall have provided such notices,
however, the Administrative Agent shall not be deemed to have accepted
or retained any Collateral in satisfaction of any Secured Obligations
for any reason.
(f) Deficiency. In the event that the proceeds of any
sale, collection or realization are insufficient to pay all amounts to
which the Administrative Agent or the Lenders are legally entitled, the
Obligors shall be jointly and severally liable for the deficiency,
together with interest thereon at the default rate specified in Section
3.1 of the Credit Agreement for Revolving Loans that are Base Rate
Loans, together with the costs of collection and the reasonable fees of
any attorneys employed by the Administrative Agent to collect such
deficiency. Any surplus remaining after the full payment and
satisfaction of the Secured Obligations shall be returned to the
Obligors or to whomsoever a court of competent jurisdiction shall
determine to be entitled thereto.
9. Rights of the Administrative Agent.
(a) Power of Attorney. In addition to other powers of
attorney contained herein, each Obligor hereby designates and appoints
the Administrative Agent, on behalf of the Lenders, and each of its
designees or agents, as attorney-in-fact of such Obligor, irrevocably
and with power of substitution, with authority to take any or all of
the following actions upon the occurrence and during the continuance of
an Event of Default:
(i) to demand, collect, settle, compromise,
adjust, give discharges and releases, all as the
Administrative Agent may reasonably determine;
(ii) to commence and prosecute any actions at any
court for the purposes of collecting any Collateral and
enforcing any other right in respect thereof;
(iii) to defend, settle or compromise any action
brought and, in connection therewith, give such discharge or
release as the Administrative Agent may deem reasonably
appropriate;
(iv) to receive, open and dispose of mail
addressed to an Obligor and endorse checks, notes, drafts,
acceptances, money orders, bills of lading, warehouse receipts
or other instruments or documents evidencing payment, shipment
or storage of the goods giving rise to the Collateral of such
Obligor
15
on behalf of and in the name of such Obligor, or securing, or
relating to such Collateral;
(v) to sell, assign, transfer, make any
agreement in respect of, or otherwise deal with or exercise
rights in respect of, any Collateral or the goods or services
which have given rise thereto, as fully and completely as
though the Administrative Agent were the absolute owner
thereof for all purposes;
(vi) to adjust and settle claims under any
insurance policy relating to the Collateral;
(vii) to execute and deliver all assignments,
conveyances, statements, financing statements, renewal
financing statements, security agreements, affidavits, notices
and other agreements, instruments and documents that the
Administrative Agent may reasonably determine necessary in
order to perfect and maintain the security interests and liens
granted in this Security Agreement and in order to fully
consummate all of the transactions contemplated therein;
(viii) to institute any foreclosure proceedings
that the Administrative Agent may deem appropriate; and
(ix) to do and perform all such other acts and
things as the Administrative Agent may reasonably deem to be
necessary, proper or convenient in connection with the
Collateral.
This power of attorney is a power coupled with an interest and shall be
irrevocable (i) for so long as any of the Secured Obligations remain
outstanding, any Credit Document or any Hedging Agreement between any
Credit Party and any Lender in connection with the Loans is in effect
or any Letter of Credit shall remain outstanding and (ii) until all of
the Commitments shall have been terminated. The Administrative Agent
shall be under no duty to exercise or withhold the exercise of any of
the rights, powers, privileges and options expressly or implicitly
granted to the Administrative Agent in this Security Agreement, and
shall not be liable for any failure to do so or any delay in doing so.
The Administrative Agent shall not be liable for any act or omission or
for any error of judgment or any mistake of fact or law in its
individual capacity or its capacity as attorney-in-fact except acts or
omissions resulting from its gross negligence or willful misconduct.
This power of attorney is conferred on the Administrative Agent solely
to protect, preserve and realize upon its security interest in the
Collateral.
(b) Performance by the Administrative Agent of
Obligations. If any Obligor fails to perform any agreement or
obligation contained herein, the Administrative Agent itself may
perform, or cause performance of, such agreement or obligation, and the
16
reasonable expenses of the Administrative Agent incurred in connection
therewith shall be payable by the Obligors on a joint and several basis
pursuant to Section 24 hereof.
(c) Assignment by the Administrative Agent. The
Administrative Agent may from time to time assign the Secured
Obligations and any portion thereof and/or the Collateral and any
portion thereof, and the assignee shall be entitled to all of the
rights and remedies of the Administrative Agent under this Security
Agreement in relation thereto.
(d) The Administrative Agent's Duty of Care. Other than
the exercise of reasonable care to assure the safe custody of the
Collateral while being held by the Administrative Agent hereunder, the
Administrative Agent shall have no duty or liability to preserve rights
pertaining thereto, it being understood and agreed that the Obligors
shall be responsible for preservation of all rights in the Collateral,
and the Administrative Agent shall be relieved of all responsibility
for the Collateral upon surrendering it or tendering the surrender of
it to the Obligors. The Administrative Agent shall be deemed to have
exercised reasonable care in the custody and preservation of the
Collateral in its possession if the Collateral is accorded treatment
substantially equal to that which the Administrative Agent accords its
own property, which shall be no less than the treatment employed by a
reasonable and prudent agent in the industry, it being understood that
the Administrative Agent shall not have responsibility for taking any
necessary steps to preserve rights against any parties with respect to
any of the Collateral.
10. Application of Proceeds. Upon the occurrence and during the
continuance of an Event of Default, any payments in respect of the Secured
Obligations and any proceeds of the Collateral, when received by the
Administrative Agent or any of the Lenders in cash or its equivalent, will be
applied in reduction of the Secured Obligations in the order set forth in
Section 3.15(b) of the Credit Agreement, and each Obligor irrevocably waives the
right to direct the application of such payments and proceeds and acknowledges
and agrees that the Administrative Agent shall have the continuing and exclusive
right to apply and reapply any and all such payments and proceeds in the
Administrative Agent's sole discretion, notwithstanding any entry to the
contrary upon any of its books and records.
11. Costs of Counsel. If at any time hereafter, whether upon the
occurrence of an Event of Default or not, the Administrative Agent employs
counsel to prepare or consider amendments, waivers or consents with respect to
this Security Agreement, or to take action or make a response in or with respect
to any legal or arbitral proceeding relating to this Security Agreement or
relating to the Collateral, or to protect the Collateral or exercise any rights
or remedies under this Security Agreement or with respect to the Collateral,
then the Obligors agree to promptly pay upon demand any and all such reasonable
documented costs and expenses of the Administrative Agent, all of which costs
and expenses shall constitute Secured Obligations hereunder.
12. Continuing Agreement.
(a) This Security Agreement shall be a continuing
agreement in every respect and shall remain in full force and effect so
long as any of the Secured Obligations remain
17
outstanding or any Credit Document or any Hedging Agreement between any
Credit Party and any Lender in connection with the Loans is in effect
or any Letter of Credit shall remain outstanding, and until all of the
Commitments thereunder shall have terminated (other than any
obligations with respect to the indemnities and the representations and
warranties set forth in the Credit Documents). Upon such payment and
termination, this Security Agreement shall be automatically terminated
and the Administrative Agent and the Lenders shall, upon the request
and at the expense of the Obligors, forthwith release all of its liens
and security interests hereunder and shall execute and deliver all UCC
termination statements and/or other documents reasonably requested by
the Obligors evidencing such termination. Notwithstanding the foregoing
all releases and indemnities provided hereunder shall survive
termination of this Security Agreement.
(b) This Security Agreement shall continue to be
effective or be automatically reinstated, as the case may be, if at any
time payment, in whole or in part, of any of the Secured Obligations is
rescinded or must otherwise be restored or returned by the
Administrative Agent or any Lender as a preference, fraudulent
conveyance or otherwise under any bankruptcy, insolvency or similar
law, all as though such payment had not been made; provided that in the
event payment of all or any part of the Secured Obligations is
rescinded or must be restored or returned, all reasonable costs and
expenses (including without limitation any reasonable legal fees and
disbursements) incurred by the Administrative Agent or any Lender in
defending and enforcing such reinstatement shall be deemed to be
included as a part of the Secured Obligations.
13. Amendments; Waivers; Modifications. This Security Agreement
and the provisions hereof may not be amended, waived, modified, changed,
discharged or terminated except as set forth in Section 11.6 of the Credit
Agreement.
14. Successors in Interest. This Security Agreement shall create a
continuing security interest in the Collateral and shall be binding upon each
Obligor, its successors and assigns and shall inure, together with the rights
and remedies of the Administrative Agent and the Lenders hereunder, to the
benefit of the Administrative Agent and the Lenders and their successors and
permitted assigns; provided, however, that none of the Obligors may assign its
rights or delegate its duties hereunder without the prior written consent of
each Lender or the Required Lenders, as required by the Credit Agreement. To the
fullest extent permitted by law, each Obligor hereby releases the Administrative
Agent and each Lender, and its successors and assigns, from any liability for
any act or omission relating to this Security Agreement or the Collateral,
except as set forth in Section 8(d) hereof and except for any liability arising
from the gross negligence or willful misconduct of the Administrative Agent, or
such Lender, or its officers, employees or agents.
15. Notices. All notices required or permitted to be given under
this Security Agreement shall be in conformance with Section 11.1 of the Credit
Agreement.
16. Counterparts. This Security Agreement may be executed in any
number of counterparts, each of which where so executed and delivered shall be
an original, but all of which
18
shall constitute one and the same instrument. It shall not be necessary in
making proof of this Security Agreement to produce or account for more than one
such counterpart.
17. Headings. The headings of the sections and subsections hereof
are provided for convenience only and shall not in any way affect the meaning or
construction of any provision of this Security Agreement.
18. Governing Law; Submission to Jurisdiction; Venue.
(a) THIS SECURITY AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF GEORGIA.
Any legal action or proceeding with respect to this Security Agreement
may be brought in the courts of the State of Georgia, or of the United
States for the Northern District of Georgia, Atlanta Division, and, by
execution and delivery of this Security Agreement, each Obligor hereby
irrevocably accepts for itself and in respect of its property,
generally and unconditionally, the jurisdiction of such courts. Each
Obligor further irrevocably consents to the service of process out of
any of the aforementioned courts in any such action or proceeding by
the mailing of copies thereof by registered or certified mail, postage
prepaid, to it at the address for notices pursuant to Section 11.1 of
the Credit Agreement, such service to become effective 3 Business Days
after such mailing. Nothing herein shall affect the right of the
Administrative Agent to serve process in any other manner permitted by
law or to commence legal proceedings or to otherwise proceed against
any Obligor in any other jurisdiction.
(b) Each Obligor hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with
this Security Agreement brought in the courts referred to in subsection
(a) hereof and hereby further irrevocably waives and agrees not to
plead or claim in any such court that any such action or proceeding
brought in any such court has been brought in an inconvenient forum.
19. Waiver of Jury Trial. TO THE EXTENT PERMITTED BY APPLICABLE
LAW, EACH OF THE PARTIES TO THIS SECURITY AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR RELATING TO THIS SECURITY AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
20. Severability. If any provision of this Security Agreement is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.
19
21. Entirety. This Security Agreement, the other Credit Documents
and any Hedging Agreement between any Credit Party and any Lender in connection
with the Loans represent the entire agreement of the parties hereto and thereto,
and supersede all prior agreements and understandings, oral or written, if any,
including any commitment letters or correspondence relating to the Credit
Documents, any Hedging Agreement between any Credit Party and any Lender in
connection with the Loans or the transactions contemplated herein and therein.
22. Survival. All representations and warranties of the Obligors
hereunder shall survive the execution and delivery of this Security Agreement,
the other Credit Documents and any Hedging Agreement between any Credit Party
and any Lender in connection with the Loans, the delivery of the Notes and the
making of the Loans and the issuance of the Letters of Credit under the Credit
Agreement.
23. Other Security. To the extent that any of the Secured
Obligations are now or hereafter secured by property other than the Collateral
(including, without limitation, real property and securities owned by an
Obligor), or by a guarantee, endorsement or property of any other Person, then
the Administrative Agent and the Lenders shall have the right to proceed against
such other property, guarantee or endorsement upon the occurrence of any Event
of Default, and the Administrative Agent and the Lenders have the right, in
their sole discretion, to determine which rights, security, liens, security
interests or remedies the Administrative Agent and the Lenders shall at any time
pursue, relinquish, subordinate, modify or take with respect thereto, without in
any way modifying or affecting any of them or any of the Administrative Agent's
and the Lenders' rights or the Secured Obligations under this Security
Agreement, under any other of the Credit Documents or under any Hedging
Agreement between any Credit Party and any Lender in connection with the Loans.
24. Joint and Several Obligations of Obligors.
(a) Each of the Obligors is accepting joint and several
liability hereunder in consideration of the financial accommodation to
be provided by the Lenders under the Credit Agreement, for the mutual
benefit, directly and indirectly, of each of the Obligors and in
consideration of the undertakings of each of the Obligors to accept
joint and several liability for the obligations of each of them.
(b) Each of the Obligors jointly and severally hereby
irrevocably and unconditionally accepts, not merely as a surety but
also as a co-debtor, joint and several liability with the other
Obligors with respect to the payment and performance of all of the
Secured Obligations arising under this Security Agreement, the other
Credit Documents and any Hedging Agreement between any Credit Party and
any Lender in connection with the Loans, it being the intention of the
parties hereto that all the Secured Obligations shall be the joint and
several obligations of each of the Obligors without preferences or
distinction among them.
(c) Notwithstanding any provision to the contrary
contained herein or in any other of the Credit Documents, to the extent
the obligations of a Guarantor shall be
20
adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers), then the obligations
of a Guarantor under the Credit Documents shall be limited to an
aggregate amount equal to the largest amount that would not render such
obligation subject to avoidance under applicable law (whether federal
or state and including, without limitation, Section 548 of the
Bankruptcy Code).
25. Rights of Required Lenders. All rights of the Administrative
Agent hereunder, if not exercised by the Administrative Agent, may be exercised
by the Required Lenders.
[remainder of page intentionally left blank]
21
Each of the parties hereto has caused a counterpart of this Security
Agreement to be duly executed and delivered as of the date first above written.
BORROWER: THE PROFIT RECOVERY GROUP USA, INC.,
a Georgia corporation
By: /s/ Xxxxxx X. Xxxxx, Xx.
--------------------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Executive Vice President - Finance,
Chief Financial Officer and Treasurer
GUARANTORS: THE PROFIT RECOVERY GROUP INTERNATIONAL, INC.,
a Georgia corporation
By: /s/ Xxxxxx X. Xxxxx, Xx.
--------------------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Executive Vice President - Finance,
Chief Financial Officer and Treasurer
PRGFS, INC.,
PRGLS, INC.,
PRGRS, INC.,
each a Delaware corporation
By: /s/ Xxxxxx X. Xxxxx, Xx.
--------------------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Executive Vice President - Finance
PRG ACQUISITION, INC.,
a Georgia corporation
By: /s/ Xxxxxx X. Xxxxx, Xx.
--------------------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Executive Vice President - Finance
GUARANTORS: THE PROFIT RECOVERY GROUP U.K., INC.,
THE PROFIT RECOVERY GROUP ASIA, INC.,
THE PROFIT RECOVERY GROUP CANADA, INC.,
THE PROFIT RECOVERY GROUP NEW ZEALAND, INC.,
THE PROFIT RECOVERY GROUP NETHERLANDS, INC.,
THE PROFIT RECOVERY GROUP BELGIUM, INC.,
THE PROFIT RECOVERY GROUP MEXICO, INC.,
THE PROFIT RECOVERY GROUP FRANCE, INC.,
THE PROFIT RECOVERY GROUP AUSTRALIA, INC.,
THE PROFIT RECOVERY GROUP GERMANY, INC.,
PRG INTERNATIONAL, INC.,
THE PROFIT RECOVERY GROUP SWITZERLAND, INC.,
THE PROFIT RECOVERY GROUP SOUTH AFRICA, INC.,
THE PROFIT RECOVERY GROUP SPAIN, INC.,
THE PROFIT RECOVERY GROUP ITALY, INC.,
THE PROFIT RECOVERY GROUP GREECE, INC.,
THE PROFIT RECOVERY GROUP PORTUGAL, INC.,
PAYMENT TECHNOLOGIES, INC.,
THE PROFIT RECOVERY GROUP COSTA RICA, INC.,
each a Georgia corporation
By: /s/ Xxxxxx X. Xxxxx, Xx.
--------------------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Executive Vice President - Finance,
Chief Financial Officer and Treasurer
PRG HOLDING CO. (FRANCE) NO. 1 LLC,
PRG HOLDING CO. (FRANCE) NO. 2 LLC,
each a Delaware limited liability company
By: /s/ Xxxxxx X. Xxxxx, Xx.
--------------------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Executive Vice President - Finance,
Chief Financial Officer and Treasurer
PRG USA, INC.,
a Georgia corporation
By: /s/ Xxxxxx X. Xxxxx, Xx.
--------------------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Executive Vice President - Finance,
Chief Financial Officer and Treasurer
Accepted and Agreed to as of the date first above written:
BANK OF AMERICA, N.A.,
in its capacity as the Administrative Agent
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxx
-----------------------------
Title: Senior Vice President
-----------------------------
SCHEDULE 2(d)
COMMERCIAL TORT CLAIMS
The Profit Recovery Group USA, Inc v. Xxxx Xxxxx de Assoc, et al. U.S. District
Court Central District of California (Western Div.) Case No. 01-CV-6200
SCHEDULE 4(a)(i)
LEGAL NAME, STATE OF FORMATION, PRINCIPAL PLACE OF BUSINESS,
CHIEF EXECUTIVE OFFICE
STATE OF
OBLIGOR / PRINCIPAL PLACE OF BUSINESS FORMATION
------------------------------------- ---------
PAYMENT TECHNOLOGIES. INC. (1) Georgia
THE PROFIT RECOVERY GROUP ASIA, INC, Georgia
00 XXXXXX Xxxx
#00-00 XxxxxXxxx Xxxxxxxxx
XXXXXXXXX 000000
THE PROFIT RECOVERY GROUP AUSTRALIA, INC. Xxxxxxx
Xxxxxxxxx Business Centers
000-000 Xxxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxx 0000
XXXXXXXXX
THE PROFIT RECOVERY GROUP BELGIUM, INC. Georgia
The Profit Recovery Group Belgium, Inc.
000 Xxx Xxxxxxx
00000 Xxxxxxxxx Xxxxx
XXXXXX
THE PROFIT RECOVERY GROUP CANADA, INC. Georgia
The Profit Recovery Group Canada, Inc.
0000 Xxxxxxx Xxxx Xxxx 0 & 4
Xxxxxxxxxxx, XX XXX 0X0
XXXXXX
THE PROFIT RECOVERY GROUP COSTA RICA, INC. Georgia
Edifcio Xxxxxxx, del Mall San Xxxxx 200 metros nortc
altos de POPS Fantasia, tercer piso
San Xxxxx, San Xxxx
XXXXX RICA
THE PROFIT RECOVERY GROUP FRANCE, INC. Georgia
000 Xxx Xxxxxxx
00000 Xxxxxxxxx Xxxxx
XXXXXX
THE PROFIT RECOVERY GROUP GERMANY, INC. Georgia
Xxxxxx-Xxxxx Xxxxxxx 00X
X-00000 Xxxxxx
XXXXXXX
THE PROFIT RECOVERY GROUP GREECE, INC. (1) Georgia
LEGAL NAME, STATE OF FORMATION, PRINCIPAL PLACE OF BUSINESS,
CHIEF EXECUTIVE OFFICE (continued)
STATE OF
OBLIGOR / PRINCIPAL PLACE OF BUSINESS FORMATION
------------------------------------- ---------
THE PROFIT RECOVERY GROUP INTERNATIONAL, INC. (1) Georgia
THE PROFIT RECOVERY GROUP ITALY, INC. Georgia
Xxxxxxxx 00X
Xxxxx 00000
XXXXX
THE PROFIT RECOVERY GROUP MEXICO, INC. Georgia
The Profit Recovery Group Mexico, Inc.
Xxxxxx Xxxxxxx 0X Xxxx 0
Xxx Xxxxxx de Chapultepec 00000
XXXXXX D.F.
THE PROFIT RECOVERY GROUP NETHERLANDS, INC. (1) Georgia
THE PROFIT RECOVERY GROUP NEW ZEALAND, INC. Georgia
The Profit Recovery Group New Zealand, Inc.
Xxxxx 0/00 Xxxx Xxxx
Xxxxxx XXX 0000
XXXXXXXXX
THE PROFIT RECOVERY GROUP PORTUGAL, INC. (1) Georgia
THE PROFIT RECOVERY GROUP SOUTH AFRICA, INC. Georgia
0 Xxxxxx Xxxx
Xxxxxxx Xxxx
Xxxxxxx 0000
XXXXX XXXXXX
THE PROFIT RECOVERY GROUP SPAIN, INC. Xxxxxxx
Xxxxx Xxxxxxxxx 00
00000 Xxxxxx
XXXXX
THE PROFIT RECOVERY GROUP SWITZERLAND, INC. Georgia
c/o KPMG Private
00 Xxxxxx xx Xxxxxxxxx
Xxxxxx
XXXXXXXXXXX
THE PROFIT RECOVERY GROUP UK, INC, Georgia
Meridian House
000-000 Xxxxxxxx Xxxx
Xxxxxx, XX0 0XX
XXXXXXX
LEGAL NAME, STATE OF FORMATION, PRINCIPAL PLACE OF BUSINESS,
CHIEF EXECUTIVE OFFICE (continued)
STATE OF
OBLIGOR / PRINCIPAL PLACE OF BUSINESS FORMATION
------------------------------------- ---------
THE PROFIT RECOVERY GROUP USA, INC. (1) Georgia
PRG INTERNATIONAL, INC. (1) Georgia
PRG USA. INC. (1) Georgia
PRG, INC.(1) Georgia
PRGFS, INC. (2) Delaware
PRGLS, INC. (2) Delaware
PRGRS, INC. (2) Delaware
PRG Holding Company (France) No. 1, LLC (2) Delaware
PRG Holding Company (France) No. 2, LLC (2) Delaware
The Chief Executive Address for each of the above Obligors is:
0000 Xxxxx Xxxxx Xxxxxxx, Xxxxx 000X
Xxxxxxx, Xxxxxxx 00000-0000
(1) The Principal Place of Business for the Obligor is:
0000 Xxxxx Xxxxx Xxxxxxx, Xxxxx 000X
Xxxxxxx, Xxxxxxx 00000-0000
(2) The Principal Place of Business for the Obligor is:
000 Xxxx Xxxxxx, Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
SCHEDULE 4(a (ii)
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MERGERS, CONSOLIDATIONS, CHANGES IN STRUCTURE, USE OF TRADENAMES
No Obligor has been party to a merger, consolidation or other change in
structure or used any tradename in the four (4) months prior to the date hereof.
SCHEDULE 5(f)(i)
NOTICE
OF
GRANT OF SECURITY INTEREST
IN
COPYRIGHTS
United States Copyright Office
Ladies and Gentlemen:
Please be advised that pursuant to the Security Agreement dated as of
December 31, 2001 (as the same may be amended, modified, extended or restated
from time to time, the "Security Agreement") by and among the Obligors party
thereto (each an "Obligor" and collectively, the "Obligors") and Bank of
America, N.A., as Administrative Agent (the "Administrative Agent") for the
Lenders referenced therein (the "Lenders"), the undersigned Obligor has granted
a continuing security interest in and continuing lien upon, the copyrights and
copyright applications shown below to the Administrative Agent for the ratable
benefit of the Lenders:
COPYRIGHTS
Date of
Copyright No. Description of Copyright Copyright
------------- ------------------------ ---------
Copyright Applications
Copyright Description of Copyright Date of Copyright
Applications No. Applied For Applications
---------------- ----------- ------------
The Obligors and the Administrative Agent, on behalf of the Lenders,
hereby acknowledge and agree that the security interest in the foregoing
copyrights and copyright applications (i) may only be terminated in accordance
with the terms of the Security Agreement and (ii) is not to be construed as an
assignment of any copyright or copyright application.
Very truly yours,
----------------------------------,
a corporation
-----------
By:
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Name:
------------------------------
Title:
------------------------------
Obligor's Address:
Acknowledged and Accepted:
BANK OF AMERICA, N.A., as Administrative Agent
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
SCHEDULE 5(f)(ii)
NOTICE
OF
GRANT OF SECURITY INTEREST
IN
PATENTS
United States Patent and Trademark Office
Ladies and Gentlemen:
Please be advised that pursuant to the Security Agreement dated as of
December 31, 2001 (the "Security Agreement") by and among the Obligors party
thereto (each an "Obligor" and collectively, the "Obligors") and Bank of
America, N.A., as Administrative Agent (the "Administrative Agent") for the
Lenders referenced therein (the "Lenders"), the undersigned Obligor has granted
a continuing security interest in and continuing lien upon, the patents and
patent applications shown below to the Administrative Agent for the ratable
benefit of the Lenders:
PATENTS
Description of Patent Date of
Patent No. Item Patent
---------------- --------------------- --------------
Patent Applications
Patent Description of Patent Date of Patent
Applications No. Applied For Applications
---------------- --------------------- --------------
The Obligors and the Administrative Agent, on behalf of the Lenders,
hereby acknowledge and agree that the security interest in the foregoing patents
and patent applications (i) may only be terminated in accordance with the terms
of the Security Agreement and (ii) is not to be construed as an assignment of
any patent or patent application.
Very truly yours,
----------------------------------,
a corporation
-----------
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
Obligor's Address:
Acknowledged and Accepted:
BANK OF AMERICA, N.A., as Administrative Agent
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
SCHEDULE 5(f)(iii)
NOTICE
OF
GRANT OF SECURITY INTEREST
IN
TRADEMARKS
United States Patent and Trademark Office
Ladies and Gentlemen:
Please be advised that pursuant to the Security Agreement dated as of
December 31, 2001 (the "Security Agreement") by and among the Obligors party
thereto (each an "Obligor" and collectively, the "Obligors") and Bank of
America, N.A., as Administrative Agent (the "Administrative Agent") for the
Lenders referenced therein (the "Lenders"), the undersigned Obligor has granted
a continuing security interest in and continuing lien upon, the trademarks and
trademark applications shown below to the Administrative Agent for the ratable
benefit of the Lenders:
TRADEMARKS
Description of Trademark Date of
Trademark No. Item Trademark
------------- ------------------------ ---------
Trademark Applications
Trademark Description of Trademark Date of Trademark
Applications No. Applied For Applications
---------------- ------------------------ -----------------
The Obligors and the Administrative Agent, on behalf of the Lenders,
hereby acknowledge and agree that the security interest in the foregoing
trademarks and trademark applications (i) may only be terminated in accordance
with the terms of the Security Agreement and (ii) is not to be construed as an
assignment of any trademark or trademark application.
Very truly yours,
----------------------------------,
a corporation
-----------
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
Obligor's Address:
Acknowledged and Accepted:
BANK OF AMERICA, N.A., as Administrative Agent
By:
-----------------------------------------
Name:
---------------------------------------
Title:
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