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Exhibit 4(e)
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GUARANTEE AND COLLATERAL AGREEMENT
made by
EV INTERNATIONAL, INC.
and its parent
EVI AUDIO HOLDING, INC.
in favor of
THE CHASE MANHATTAN BANK,
as Administrative Agent
Dated as of February 10, 1997
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TABLE OF CONTENTS
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SECTION 1. DEFINED TERMS....................................................................................... 2
1.1 Definitions....................................................................................... 2
1.2 Other Definitional Provisions..................................................................... 8
SECTION 2. GUARANTEE........................................................................................... 8
2.1 Guarantee......................................................................................... 8
2.2 Right of Contribution............................................................................. 9
2.3 No Subrogation.................................................................................... 9
2.4 Amendments, etc. with respect to the Borrower Obligations......................................... 10
2.5 Guarantee Absolute and Unconditional.............................................................. 10
2.6 Reinstatement..................................................................................... 11
2.7 Payments.......................................................................................... 12
SECTION 3. GRANT OF SECURITY INTEREST.......................................................................... 12
SECTION 4. REPRESENTATIONS AND WARRANTIES...................................................................... 13
4.1 Representations and Warranties of Each Guarantor................................................ 13
4.2 Representations and Warranties of Each Grantor.................................................. 13
4.2.1 Title; No Other Liens........................................................................... 13
4.2.2 Perfected First Priority Liens.................................................................. 14
4.2.3 Chief Executive Office.......................................................................... 15
4.2.4 Inventory and Equipment......................................................................... 15
4.2.5 Farm Products................................................................................... 15
4.2.6 Accounts........................................................................................ 15
4.2.7 Intellectual Property........................................................................... 15
4.3 Representations and Warranties of Each Pledgor.................................................. 15
SECTION 5. COVENANTS........................................................................................... 16
5.1 Covenants of Each Guarantor..................................................................... 16
5.2 Covenants of Each Grantor....................................................................... 16
5.2.1 Delivery of Instruments and Chattel Paper....................................................... 17
5.2.2 Maintenance of Insurance........................................................................ 17
5.2.3 Payment of Obligations.......................................................................... 17
5.2.4 Maintenance of Perfected Security Interest; Further Documentation............................... 17
5.2.5 Changes in Locations, Name, etc................................................................. 18
5.2.6 Notices......................................................................................... 18
5.2.7 Pledged Securities.............................................................................. 19
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5.2.8 Accounts....................................................................................... 19
5.2.9 Maintenance of Records......................................................................... 19
5.2.10 Acquisition of Intellectual Property........................................................... 19
5.2.11 Protection of Trade Secrets.................................................................... 20
5.3 Covenants of Each Pledgor...................................................................... 20
5.4 Covenants of Holdings.......................................................................... 21
SECTION 6. REMEDIAL PROVISIONS................................................................................. 22
6.1 Certain Matters Relating to Accounts.............................................................. 22
6.2 Communications with Obligors; Grantors Remain Liable.............................................. 25
6.3 Pledged Stock..................................................................................... 25
6.4 Proceeds to be Turned Over To Administrative Agent................................................ 26
6.5 Application of Proceeds........................................................................... 27
6.6 Code and Other Remedies........................................................................... 27
6.7 Registration Rights............................................................................... 28
6.8 Waiver; Deficiency................................................................................ 29
SECTION 7. THE ADMINISTRATIVE AGENT............................................................................ 29
7.1 Administrative Agent's Appointment as Attorney-in-Fact, etc....................................... 29
7.2 Duty of Administrative Agent...................................................................... 31
7.3 Execution of Financing Statements................................................................. 32
7.4 Authority of Administrative Agent................................................................. 32
7.5 Right Of Inspection............................................................................... 32
SECTION 8. MISCELLANEOUS....................................................................................... 33
8.1 Amendments in Writing............................................................................. 33
8.2 Notices........................................................................................... 33
8.3 No Waiver by Course of Conduct; Cumulative Remedies............................................... 33
8.4 Enforcement Expenses; Indemnification............................................................. 33
8.5 Successors and Assigns............................................................................ 34
8.6 Set-Off........................................................................................... 34
8.7 Counterparts...................................................................................... 34
8.8 Severability...................................................................................... 34
8.9 Section Headings.................................................................................. 35
8.10 Integration....................................................................................... 35
8.11 GOVERNING LAW..................................................................................... 35
8.12 Submission To Jurisdiction; Waivers............................................................... 35
8.13 Acknowledgements.................................................................................. 36
8.14 WAIVER OF JURY TRIAL.............................................................................. 36
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8.15 Additional Granting Parties...................................................................... 36
8.16 Releases......................................................................................... 36
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SCHEDULES
1 Notice Addresses of Guarantors
2 Description of Pledged Securities
3 Location of Jurisdiction of Organization and Chief Executive Office or Sole Place of
Business
4 Location of Inventory and Equipment
5 Copyrights and Copyright Licenses; Patents and Patent Licenses; Trademarks and
Trademark Licenses
6 Existing Prior Liens
7 Accounts
8 Contracts
ANNEXES
1 Assumption Agreement
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GUARANTEE AND COLLATERAL AGREEMENT
GUARANTEE AND COLLATERAL AGREEMENT, dated as of February 10,
1997, made by EVI Audio Holding, Inc. a Delaware corporation formerly named
Gulton Holding Corp. ("Holdings"), EV International, Inc., a Delaware
corporation formerly named Electro-Voice, Incorporated (the "Borrower") and
successor by merger to the Merged Companies referred to below (Holdings and the
Borrower, together with any other Subsidiary of the Borrower that becomes a
party hereto from time to time after the date hereof, the ("Granting Parties"),
in favor of The Chase Manhattan Bank, as administrative agent (in such capacity,
the "Administrative Agent") for the banks and other financial institutions (the
"Lenders") from time to time parties to the Credit Agreement, dated as of
February 10, 1997 (as amended, waived, supplemented or otherwise modified from
time to time, the "Senior Secured Credit Agreement"), among the Borrower (as
successor by merger to Gulton Acquisition Corp.), the Lenders and the
Administrative Agent.
W I T N E S S E T H:
WHEREAS, pursuant to the Senior Secured Credit Agreement, the
Lenders have severally agreed to make extensions of credit to the Borrower upon
the terms and subject to the conditions set forth therein;
WHEREAS, on the date hereof, the following transactions have
occurred or are occurring:
(i) Holdings through its subsidiary Gulton Acquisition Corp.,
a Delaware corporation ("Acquisition Co."), is acquiring the capital
stock of Gulton Industries, Inc., a Delaware corporation ("GII"), the
parent of each of LFE Corporation, Xxxx XX Audio, Inc. and Xxxx XX
Audio Magnetic, Inc., each a Delaware corporation (together with
Acquisition Co. and GII, the "Merged Companies"), and the parent of the
Borrower,
(ii) Acquisition Co. is merging with and into GII, with GII
surviving, and GII and the other Merged Companies are merging with and
into the Borrower, with the Borrower surviving and being renamed EV
International, Inc., and succeeding by operation of such mergers to all
the rights and obligations of Acquisition Co. under the Senior Secured
Credit Agreement and becoming the Borrower thereunder, and
(iii) the Borrower is contributing, assigning and transferring
to its wholly owned subsidiary EVI Audio International Holding
Corporation, Inc., a Delaware corporation ("EVI Audio"), all of the
capital stock of the Borrower's other subsidiaries held by the Borrower
on the date hereof, other than the Excluded Foreign Subsidiary Stock
(as defined herein);
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WHEREAS, the Borrower is a member of an affiliated group of
companies that includes or will include each other Granting Party;
WHEREAS, the proceeds of the extensions of credit will be used
in part to enable the Borrower to make valuable transfers to one or more of the
other Granting Party in connection with the operation of their respective
businesses;
WHEREAS, the Borrower and the other Granting Parties are
engaged in related businesses, and each such Granting Party will derive
substantial direct and indirect benefit from the making of the extensions of
credit under the Senior Secured Credit Agreement; and
WHEREAS, it is a condition to the obligation of the Lenders to
make their respective extensions of credit to the Borrower under the Senior
Secured Credit Agreement that the Granting Parties shall execute and deliver
this Agreement to the Administrative Agent for the benefit of the Lenders;
NOW, THEREFORE, in consideration of the premises and to induce
the Administrative Agent and the Lenders to enter into the Senior Secured Credit
Agreement and to induce the Lenders to make their respective extensions of
credit to the Borrower thereunder, each Granting Party hereby agrees with the
Administrative Agent, for the ratable benefit of the Secured Parties, as
follows:
SECTION 1. DEFINED TERMS
1.1 Definitions. (a) Unless otherwise defined herein, terms
defined in the Senior Secured Credit Agreement and used herein shall have the
meanings given to them in the Senior Secured Credit Agreement, and the following
terms which are defined in the Code (as defined below) are used herein as so
defined: Chattel Paper, Documents, Equipment, Farm Products, Fixtures,
Instruments and Inventory.
(b) The following terms shall have the following meanings:
"Accounts": all accounts (as defined in the Code) of the
Borrower, including, without limitation all Accounts (as defined in the
Senior Secured Credit Agreement) of the Borrower.
"Agreement": this Guarantee and Collateral Agreement, as the
same may be amended, supplemented or otherwise modified from time to
time.
"Borrower Obligations": the collective reference to the unpaid
principal of and interest on the Loans and Reimbursement Obligations
and all other obligations and liabilities of the Borrower (including,
without limitation, interest accruing at the then applicable rate
provided in the Senior Secured Credit Agreement after the maturity of
the Loans and Reimbursement Obligations and interest accruing at the
then applicable
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rate provided in the Senior Secured Credit Agreement after the filing
of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Borrower, whether or
not a claim for post-filing or post-petition interest is allowed in
such proceeding) to the Administrative Agent or any Lender (or, in the
case of any Hedge Agreement referred to below, any Affiliate of any
Lender), whether direct or indirect, absolute or contingent, due or to
become due, or now existing or hereafter incurred, which may arise
under, out of, or in connection with, the Senior Secured Credit
Agreement, this Agreement, the other Loan Documents and any Letter of
Credit or any Hedge Agreement entered into by the Borrower with any
Lender (or, in the case of any Hedge Agreement, any Affiliate of any
Lender) or any other document made, delivered or given in connection
therewith, in each case whether on account of principal, interest,
reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of
counsel to the Administrative Agent or to the Lenders that are required
to be paid by the Borrower pursuant to the terms of any of the
foregoing agreements).
"Code": the Uniform Commercial Code as from time to time in
effect in the State of New York.
"Collateral": as defined in Section 3.
"Collateral Account Bank": The Chase Manhattan Bank or another
bank which at all times is a Lender as selected by the Borrower and
notified to the Administrative Agent in writing promptly following such
selection.
"Collateral Proceeds Account": the cash collateral account
established by the relevant Grantor at an office of the Collateral
Account Bank in the name of the Administrative Agent.
"Commitments": the collective reference to the Revolving
Credit Commitments, the Swing Line Commitment, the Term Loan
Commitments and the L/C Commitment; individually, a "Commitment".
"Contracts" with respect to any Grantor, all contracts,
agreements, instruments and indentures in any form, and portions
thereof (except for the contracts listed on Schedule 8), to which such
Grantor is a party or under which such Grantor has any right, title or
interest or to which such Grantor or any property of such Grantor is
subject, as the same may from time to time be amended, supplemented or
otherwise modified, including, without limitation, (i) all rights of
such Grantor to receive moneys due and to become due to it thereunder
or in connection therewith, (ii) all rights of such Grantor to damages
arising thereunder and (iii) all rights of such Grantor to perform and
to exercise all remedies thereunder.
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"Copyright Licenses": with respect to any Grantor, all United
States written license agreements of such Grantor providing for the
grant by or to such Grantor of any right to use any Copyright of such
Grantor, other than intercompany agreements, including, without
limitation, any license agreements listed on Schedule 5 hereto subject,
in each case, to the terms of such license agreements, and the right to
prepare for sale, sell and advertise for sale, all Inventory now or
hereafter covered by such licenses.
"Copyrights": with respect to any Grantor, all of such
Grantor's right, title and interest in and to all United States
copyrights, whether or not the underlying works of authorship have been
published or registered, United States copyright registrations and
copyright applications, and (a) all renewals thereof, (b) all income,
royalties, damages and payments now and hereafter due and/or payable
with respect thereto, including, without limitation, payments under all
licenses entered into in connection therewith, and damages and payments
for past or future infringements thereof and (c) the right to xxx or
otherwise recover for past, present and future infringements and
misappropriations thereof.
"Default": a "Default" as defined in the Senior Secured Credit
Agreement.
"Event of Default": an "Event of Default" as defined in the
Senior Secured Credit Agreement.
"Excluded Foreign Subsidiary Stock": one share of EVI Audio
GmbH, a German company; three shares of Xxxx XX Audio (Europe) AG, a
Swiss company; seven shares of Xxxx XX France S.A., a French company;
seven shares of Dynacord France S.A., a French company; one share of
Xxxx XX (Hong Kong) Limited, a Hong Kong company; and one share of
Audio Consultants Co., Limited, a Hong Kong company.
"General Fund Account": the general fund account of the
relevant Grantor established at the same office of the Collateral
Account Bank as the Collateral Proceeds Account.
"General Intangibles": all "general intangibles" as such term
is defined in Section 9-106 of the Uniform Commercial Code in effect in
the State of New York on the date hereof.
"Granting Parties": as defined in the initial paragraph
hereof.
"Grantor": the Borrower and each Domestic Subsidiary of the
Borrower that from time to time becomes a party hereto.
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"Guarantor Obligations": with respect to any Guarantor, the
collective reference to (i) the Borrower Obligations and (ii) all
obligations and liabilities of such Guarantor which may arise under or
in connection with this Agreement or any other Loan Document to which
such Guarantor is a party, in each case whether on account of guarantee
obligations, reimbursement obligations, fees, indemnities, costs,
expenses or otherwise (including, without limitation, all fees and
disbursements of counsel to the Administrative Agent or to the Lenders
that are required to be paid by such Guarantor pursuant to the terms of
this Agreement or any other Loan Document).
"Guarantors": the collective reference to each Granting Party
other than the Borrower.
"Hedge Agreements": as to any Grantor, all interest rate
swaps, caps or collar agreements or similar arrangements entered into
by such Person providing for protection against fluctuations in
interest rates or currency exchange rates or the exchange of nominal
interest obligations, either generally or under specific contingencies,
including, without limitation, all Interest Rate Protection Agreements
and Permitted Hedging Arrangements with respect to currency exchange
rates.
"Intellectual Property": with respect to any Grantor, the
collective reference to such Grantor's Copyrights, Copyright Licenses,
Patents, Patent Licenses, Trade Secrets, Trademarks and Trademark
Licenses.
"Intercompany Note": with respect to any Grantor, any
promissory note evidencing loans made by such Grantor to the Borrower
or any of its Subsidiaries.
"Issuers": the collective reference to the Persons identified
on Schedule 2 as the issuers of the Pledged Stock.
"Inventory": with respect to any Grantor, all inventory (as
defined in the Code) of such Grantor, including, without limitation,
all Inventory (as defined in the Senior Secured Credit Agreement) of
the Borrower.
"Loan Documents": the collective reference to the "Loan
Documents" as defined in the Senior Secured Credit Agreement.
"Loans": the collective reference to the "Loans" as defined in
the Senior Secured Credit Agreement.
"Lockbox System": the system, if any, of lockboxes and related
deposit accounts established and maintained pursuant to Section 6.1(d)
of this Agreement.
"Notes": the collective reference to the "Notes" as defined in
the Senior Secured Credit Agreement.
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"Obligations": (i) in the case of the Borrower, the Borrower
Obligations, and (ii) in the case of each Guarantor, its Guarantor
Obligations.
"Patent Licenses": with respect to any Grantor, all United
States written license agreements of such Grantor with any Person who
is not an Affiliate or a Subsidiary in connection with any of the
Patents of such Grantor or such other Person's patents, whether such
Grantor is a licensor or a licensee under any such agreement,
including, without limitation, the license agreements listed on
Schedule 5, subject, in each case, to the terms of such license
agreements, and the right to prepare for sale, sell and advertise for
sale, all Inventory now or hereafter covered by such licenses.
"Patents": with respect to any Grantor, all of such Grantor's
right, title and interest in and to all United States patents, patent
applications and patentable inventions and all reissues and extensions
thereof, including, without limitation, all patents and patent
applications identified in Schedule 5, and including, without
limitation, (a) all inventions and improvements described and claimed
therein, and patentable inventions, (b) the right to xxx or otherwise
recover for any and all past, present and future infringements and
misappropriations thereof, (c) all income, royalties, damages and other
payments now and hereafter due and/or payable with respect thereto
(including, without limitation, payments under all licenses entered
into in connection therewith, and damages and payments for past or
future infringements thereof), and (d) all other rights corresponding
thereto in the United States and all reissues, divisions,
continuations, continuations-in-part, substitutes, renewals, and
extensions thereof, all improvements thereon, and all other rights of
any kind whatsoever of such Grantor accruing thereunder or pertaining
thereto.
"Pledged Collateral": as defined in Section 3.
"Pledged Notes": with respect to any Pledgor, all Intercompany
Notes at any time issued to such Pledgor and all other promissory notes
issued to or held by such Pledgor (other than promissory notes issued
in connection with extensions of trade credit by any Pledgor in the
ordinary course of business).
"Pledged Securities": the collective reference to the Pledged
Notes and the Pledged Stock.
"Pledged Stock": with respect to any Pledgor, the shares of
Capital Stock listed on Schedule 2 as held by such Pledgor, together
with any other shares, stock certificates, options or rights of any
nature whatsoever in respect of the Capital Stock of any Issuer that
may be issued or granted to, or held by, such Pledgor while this
Agreement is in effect (provided that in no event shall there be
pledged, nor shall any Pledgor be required to pledge, directly or
indirectly, (x) more than 65% of any series of the outstanding Capital
Stock of any Foreign Subsidiary pursuant to this Agreement) or (y) any
Excluded Foreign Subsidiary Stock).
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"Pledgor": Holdings (with respect to Pledged Stock of the
Borrower), the Borrower (with respect to Pledged Stock of EVI Audio and
any other Subsidiary of the Borrower and any other Pledged Securities
held by the Borrower) and any other Granting Party (with respect to
Pledged Securities held by such Granting Party).
"Proceeds": all "proceeds" as such term is defined in Section
9-306(1) of the Uniform Commercial Code in effect in the State of New
York on the date hereof and, in any event, Proceeds of Pledged
Securities shall include, without limitation, all dividends or other
income from the Pledged Securities, collections thereon or
distributions or payments with respect thereto.
"Revolving Credit Commitments": the collective reference to
the "Revolving Credit Commitments" as defined in the Senior Secured
Credit Agreement.
"Secured Parties": the collective reference to the
Administrative Agent, the Lenders (including, without limitation the
Issuing Lender and the Swing Line Lender) and any Affiliate of any
Lender which has entered into any Interest Rate Protection Agreement or
Permitted Hedging Arrangement with the Borrower or any of its
Subsidiaries, and their respective successors and assigns.
"Securities Act": the Securities Act of 1933, as amended from
time to time.
"Security Collateral": as defined in Section 3.
"Trade Secrets": with respect to any Grantor, all of such
Grantor's right, title and interest in and to all United States trade
secrets, including, without limitation, know-how, processes, formulae,
compositions, designs, and confidential business and technical
information, and all rights of any kind whatsoever accruing thereunder
or pertaining thereto, including, without limitation, (a) all income,
royalties, damages and payments now and hereafter due and/or payable
with respect thereto, including, without limitation, payments under all
licenses, non-disclosure agreements and memoranda of understanding
entered into in connection therewith, and damages and payments for past
or future misappropriations thereof, and (b) the right to xxx or
otherwise recover for past, present or future misappropriations
thereof.
"Trademark Licenses": with respect to any Grantor, all United
States written license agreements of such Grantor with any Person who
is not an Affiliate or a Subsidiary in connection with any of the
Trademarks of such Grantor or such other Person's names or trademarks,
whether such Grantor is a licensor or a licensee under any such
agreement, including, without limitation, the license agreements listed
on Schedule 5, subject, in each case, to the terms of such license
agreements, and the right to prepare for sale, sell and advertise for
sale, all Inventory now or hereafter covered by such licenses.
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"Trademarks": with respect to any Grantor, all of such
Grantor's right, title and interest in and to all United States
trademarks, service marks, trade names, trade dress or other indicia of
trade origin or business identifiers, trademark and service xxxx
registrations, and applications for trademark or service xxxx
registrations (except for "intent to use" applications for trademark or
service xxxx registrations filed pursuant to Section 1(b) of the Xxxxxx
Act, 15 U.S.C. Section 1051, unless and until an Amendment to Allege
Use or a Statement of Use under Sections 1(c) and 1(d) of said Act has
been filed), and any renewals thereof, including, without limitation,
each registration and application identified in Schedule 5, and
including, without limitation, (a) the right to xxx or otherwise
recover for any and all past, present and future infringements and
misappropriations thereof, (b) all income, royalties, damages and other
payments now and hereafter due and/or payable with respect thereto
(including, without limitation, payments under all licenses entered
into in connection therewith, and damages and payments for past or
future infringements thereof), and (c) all other rights corresponding
thereto in the United States and all other rights of any kind
whatsoever of such Grantor accruing thereunder or pertaining thereto,
together in each case with the goodwill of the business connected with
the use of, and symbolized by, each such trademark, service xxxx, trade
name, trade dress or other indicia of trade origin or business
identifiers.
"Vehicles": all cars, trucks, trailers, construction and earth
moving equipment and other vehicles covered by a certificate of title
law of any state and all tires and other appurtenances to any of the
foregoing.
1.2 Other Definitional Provisions. (a) The words "hereof,"
"herein", "hereto" and "hereunder" and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement, and Section , Schedule and Annex references are to
this Agreement unless otherwise specified.
(b) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.
(c) Where the context requires, terms relating to the
Collateral, Pledged Collateral or Security Collateral, or any part thereof, when
used in relation to a Granting Party shall refer to such Granting Party's
Collateral, Pledged Collateral or Security Collateral or the relevant part
thereof.
SECTION 2. GUARANTEE
2.1 Guarantee. (a) Each of the Guarantors hereby, jointly and
severally, unconditionally and irrevocably, guarantees to the Administrative
Agent, for the ratable benefit of the Secured Parties and their respective
successors, indorsees, transferees and assigns, the
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prompt and complete payment and performance by the Borrower when due and payable
(whether at the stated maturity, by acceleration or otherwise) of the Borrower
Obligations.
(b) Anything herein or in any other Loan Document to the
contrary notwithstanding, the maximum liability of each Guarantor hereunder and
under the other Loan Documents shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable law, including applicable federal
and state laws relating to the insolvency of debtors.
(c) Each Guarantor agrees that the Borrower Obligations may at
any time and from time to time exceed the amount of the liability of such
Guarantor hereunder without impairing the guarantee contained in this Section 2
or affecting the rights and remedies of the Administrative Agent or any other
Secured Party hereunder.
(d) The guarantee contained in this Section 2 shall remain in
full force and effect until the earlier to occur of (i) the first date on which
all the Loans, any Reimbursement Obligations, all other Borrower Obligations
then due and owing, and the obligations of each Guarantor under the guarantee
contained in this Section 2 then due and owing shall have been satisfied by
payment in full, no Letter of Credit shall be outstanding and the Commitments
shall be terminated, notwithstanding that from time to time during the term of
the Senior Secured Credit Agreement the Borrower may be free from any Borrower
Obligations or (ii) as to any Guarantor, the sale or other disposition of all of
the Capital Stock of such Guarantor permitted under the Senior Secured Credit
Agreement.
(e) No payment made by the Borrower, any of the Guarantors,
any other guarantor or any other Person or received or collected by the
Administrative Agent or any other Secured Party from the Borrower, any of the
Guarantors, any other guarantor or any other Person by virtue of any action or
proceeding or any set-off or appropriation or application at any time or from
time to time in reduction of or in payment of the Borrower Obligations shall be
deemed to modify, reduce, release or otherwise affect the liability of any
Guarantor hereunder which shall, notwithstanding any such payment (other than
any payment made by such Guarantor in respect of the Borrower Obligations or any
payment received or collected from such Guarantor in respect of the Borrower
Obligations), remain liable for the Borrower Obligations up to the maximum
liability of such Guarantor hereunder until the earlier to occur of (i) the
first date on which the Loans, any Reimbursement Obligations, and all other
Borrower Obligations then due and owing, are paid in full, no Letter of Credit
shall be outstanding and the Commitments are terminated or (ii) the sale or
other disposition of all of the Capital Stock of such Guarantor permitted under
the Senior Secured Credit Agreement.
2.2 Right of Contribution. Each Guarantor hereby agrees that
to the extent that a Guarantor shall have paid more than its proportionate share
of any payment made hereunder, such Guarantor shall be entitled to seek and
receive contribution from and against any other Guarantor hereunder which has
not paid its proportionate share of such payment. Each Guarantor's right of
contribution shall be subject to the terms and conditions of Section 2.3.
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The provisions of this Section 2.2 shall in no respect limit the obligations and
liabilities of any Guarantor to the Administrative Agent and the other Secured
Parties, and each Guarantor shall remain liable to the Administrative Agent and
the Lenders for the full amount guaranteed by such Guarantor hereunder.
2.3 No Subrogation. Notwithstanding any payment made by any
Guarantor hereunder or any set-off or application of funds of any Guarantor by
the Administrative Agent or any other Secured Party, no Guarantor shall be
entitled to be subrogated to any of the rights of the Administrative Agent or
any other Secured Party against the Borrower or any other Guarantor or any
collateral security or guarantee or right of offset held by the Administrative
Agent or any other Secured Party for the payment of the Borrower Obligations,
nor shall any Guarantor seek or be entitled to seek any contribution or
reimbursement from the Borrower or any other Guarantor in respect of payments
made by such Guarantor hereunder, until all amounts owing to the Administrative
Agent and the other Secured Parties by the Borrower on account of the Borrower
Obligations are paid in full, no Letter of Credit shall be outstanding and the
Commitments are terminated. If any amount shall be paid to any Guarantor on
account of such subrogation rights at any time when all of the Borrower
Obligations shall not have been paid in full, such amount shall be held by such
Guarantor in trust for the Administrative Agent and the other Secured Parties,
segregated from other funds of such Guarantor, and shall, forthwith upon receipt
by such Guarantor, be turned over to the Administrative Agent in the exact form
received by such Guarantor (duly indorsed by such Guarantor to the
Administrative Agent, if required), to be applied against the Borrower
Obligations, whether matured or unmatured, in such order as the Administrative
Agent may determine.
2.4 Amendments, etc. with respect to the Borrower Obligations.
To the maximum extent permitted by law, each Guarantor shall remain obligated
hereunder notwithstanding that, without any reservation of rights against any
Guarantor and without notice to or further assent by any Guarantor, any demand
for payment of any of the Borrower Obligations made by the Administrative Agent
or any other Secured Party may be rescinded by the Administrative Agent or such
other Secured Party and any of the Borrower Obligations continued, and the
Borrower Obligations, or the liability of any other Person upon or for any part
thereof, or any collateral security or guarantee therefor or right of offset
with respect thereto, may, from time to time, in whole or in part, be renewed,
extended, amended, modified, accelerated, compromised, waived, surrendered or
released by the Administrative Agent or any other Secured Party, and the Senior
Secured Credit Agreement and the other Loan Documents and any other documents
executed and delivered in connection therewith may be amended, modified,
supplemented or terminated, in whole or in part, as the Administrative Agent (or
the Required Lenders, as the case may be) may deem advisable from time to time,
and any collateral security, guarantee or right of offset at any time held by
the Administrative Agent or any other Secured Party for the payment of the
Borrower Obligations may be sold, exchanged, waived, surrendered or released.
Neither the Administrative Agent nor any other Secured Party shall have any
obligation to protect, secure, perfect or insure any Lien at any
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time held by it as security for the Borrower Obligations or for the guarantee
contained in this Section 2 or any property subject thereto, except to the
extent required by applicable law.
2.5 Guarantee Absolute and Unconditional. Each Guarantor
waives, to the maximum extent permitted by applicable law, any and all notice of
the creation, renewal, extension or accrual of any of the Borrower Obligations
and notice of or proof of reliance by the Administrative Agent or any other
Secured Party upon the guarantee contained in this Section 2 or acceptance of
the guarantee contained in this Section 2; the Borrower Obligations, and any of
them, shall conclusively be deemed to have been created, contracted or incurred,
or renewed, extended, amended or waived, in reliance upon the guarantee
contained in this Section 2; and all dealings between the Borrower and any of
the Guarantors, on the one hand, and the Administrative Agent and the other
Secured Parties, on the other hand, likewise shall be conclusively presumed to
have been had or consummated in reliance upon the guarantee contained in this
Section 2. Each Guarantor waives, to the maximum extent permitted by applicable
law, diligence, presentment, protest, demand for payment and notice of default
or nonpayment to or upon the Borrower or any of the other Guarantors with
respect to the Borrower Obligations. Each Guarantor understands and agrees, to
the extent permitted by law, that the guarantee contained in this Section 2
shall be construed as a continuing, absolute and unconditional guarantee of
payment. Each Guarantor hereby waives, to the maximum extent permitted by
applicable law, any and all defenses that it may have arising out of or in
connection with any and all of the following: (a) the validity or enforceability
of the Senior Secured Credit Agreement or any other Loan Document, any of the
Borrower Obligations or any other collateral security therefor or guarantee or
right of offset with respect thereto at any time or from time to time held by
the Administrative Agent or any other Secured Party, (b) any defense, set-off or
counterclaim (other than a defense of payment or performance) which may at any
time be available to or be asserted by the Borrower against the Administrative
Agent or any other Secured Party, (c) any change in the time, place, manner or
place of payment, amendment, or waiver or increase in the Obligations, (d) any
exchange, taking, or release of Collateral, (e) any change in the corporate
structure or existence of the Borrower, (f) any application of Collateral to
Obligations or (g) any other circumstance whatsoever (with or without notice to
or knowledge of the Borrower or such Guarantor) which constitutes, or might be
construed to constitute, an equitable or legal discharge of the Borrower for the
Borrower Obligations, or of such Guarantor under the guarantee contained in this
Section 2, in bankruptcy or in any other instance. When making any demand
hereunder or otherwise pursuing its rights and remedies hereunder against any
Guarantor, the Administrative Agent or any other Secured Party may, but shall be
under no obligation to, make a similar demand on or otherwise pursue such rights
and remedies as it may have against the Borrower, any other Guarantor or any
other Person or against any collateral security or guarantee for the Borrower
Obligations or any right of offset with respect thereto, and any failure by the
Administrative Agent or any other Secured Party to make any such demand, to
pursue such other rights or remedies or to collect any payments from the
Borrower, any other Guarantor or any other Person or to realize upon any such
collateral security or guarantee or to exercise any such right of offset, or any
release of the Borrower, any other Guarantor or any other Person or any such
collateral security, guarantee or right of offset, shall not relieve any
Guarantor of any
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obligation or liability hereunder, and shall not impair or affect the rights and
remedies, whether express, implied or available as a matter of law, of the
Administrative Agent or any other Secured Party against any Guarantor. For the
purposes hereof "demand" shall include the commencement and continuance of any
legal proceedings.
2.6 Reinstatement. The guarantee contained in this Section 2
shall continue to be effective, or be reinstated, as the case may be, if at any
time payment, or any part thereof, of any of the Borrower Obligations is
rescinded or must otherwise be restored or returned by the Administrative Agent
or any other Secured Party upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of the Borrower or any Guarantor, or upon or as a
result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, the Borrower or any Guarantor or any substantial
part of its property, or otherwise, all as though such payments had not been
made.
2.7 Payments. Each Guarantor hereby guarantees that payments
hereunder will be paid to the Administrative Agent without set-off or
counterclaim in Dollars at the office of the Administrative Agent located at 000
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
SECTION 3. GRANT OF SECURITY INTEREST
Each Granting Party (1) that is a Grantor hereby grants to the
Administrative Agent, for the ratable benefit of the Secured Parties, a security
interest in all of the following property now owned or at any time hereafter
acquired by such Grantor or in which such Grantor now has or at any time in the
future may acquire any right, title or interest (collectively, the
"Collateral"), as collateral security for the prompt and complete payment and
performance when due (whether at the stated maturity, by acceleration or
otherwise) of the Obligations of such Grantor:
(a) all Accounts;
(b) all Chattel Paper;
(c) all Contracts;
(d) all Documents;
(e) all Equipment (other than Vehicles);
(f) all General Intangibles;
(g) all Instruments;
(h) all Intellectual Property;
(i) all Inventory;
(j) all books and records pertaining to any of the foregoing;
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(k) the Collateral Proceeds Account; and
(l) to the extent not otherwise included, all Proceeds and
products of any and all of the foregoing and all collateral security
and guarantees given by any Person with respect to any of the
foregoing;
and (2) that is a Pledgor hereby grants to the Administrative Agent, for the
ratable benefit of the Secured Parties, a security interest in all of the
Pledged Securities now owned or at any time hereafter acquired by such Pledgor,
and any Proceeds thereof (the "Pledged Collateral"), as collateral security for
the prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration or otherwise) of the Obligations of such Pledgor (the
Collateral (if any) and the Pledged Collateral (if any) of each Granting Party
being collectively referred to herein as such Granting Party's "Security
Collateral");
provided however, that (x) Collateral shall not include any Pledged Collateral,
or any property or assets specifically excluded from Pledged Collateral
(including any Excluded Foreign Subsidiary Stock, and any Capital Stock of any
Foreign Subsidiary in excess of 65% of any series of such stock); and (y) in the
case of any Instruments, Contracts, Chattel Paper, General Intangibles,
Copyright Licenses, Patent Licenses, Trademark Licenses or other contracts or
agreements with or issued by Persons (other than a Subsidiary of the Borrower)
that would otherwise be included in the Security Collateral, no security
interest in the right, title and interest of any Granting Party thereunder or
therein will be granted pursuant to this Section 2 (and such Instruments,
Contracts, Chattel Paper, General Intangibles, Copyright Licenses, Patent
Licenses, Trademark Licenses or other contracts or agreements shall not be
deemed to constitute a part of the Security Collateral) for so long as, and to
the extent that, the granting of a security interest in the right, title and
interest of such Grantor thereunder or therein pursuant to the terms hereof
would result in a breach, default or termination of such Instruments, Contracts,
Chattel Paper, General Intangibles, Copyright Licenses, Patent Licenses,
Trademark Licenses or other contracts or agreements and (z) in the case of the
Equipment that would otherwise be included in the foregoing Collateral, the
foregoing will not be deemed to grant a security interest therein under this
Agreement (and such Equipment shall not be deemed to constitute a part of the
Collateral) if such Equipment is subject to a Lien permitted by subsection
8.3(h) of the Senior Secured Credit Agreement.
SECTION 4. REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of Each Guarantor. To
induce the Administrative Agent and the Lenders to enter into the Senior Secured
Credit Agreement and to induce the Lenders to make their respective extensions
of credit to the Borrower thereunder, each Guarantor hereby represents and
warrants to the Administrative Agent and each other Secured Party that the
representations and warranties set forth in Section 5 of the Senior Secured
Credit Agreement as they relate to such Guarantor or to the Loan Documents to
which such Guarantor is a party or to the Transaction Documents to which such
Guarantor is a party,
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each of which representations and warranties is hereby incorporated herein by
reference, are true and correct in all material respects, and the Administrative
Agent and each other Secured Party shall be entitled to rely on each of such
representations and warranties as if fully set forth herein; provided that each
reference in each such representation and warranty to the Borrower's knowledge
shall, for the purposes of this Section 4.1, be deemed to be a reference to such
Guarantor's knowledge.
4.2 Representations and Warranties of Each Grantor. To induce
the Administrative Agent and the Lenders to enter into the Senior Secured Credit
Agreement and to induce the Lenders to make their respective extensions of
credit to the Borrower thereunder, each Grantor hereby represents and warrants
to the Administrative Agent and each other Secured Party that:
4.2.1 Title; No Other Liens. Except for the security interest
granted to the Administrative Agent, for the ratable benefit of the Secured
Parties, pursuant to this
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Agreement and the other Liens permitted to exist on such Grantor's Collateral by
the Senior Secured Credit Agreement (including without limitation subsection 8.3
thereof), such Grantor owns each item of such Grantor's Collateral free and
clear of any and all Liens. Except as set forth on Schedule 6, no financing
statement or other similar public notice with respect to all or any part of such
Grantor's Collateral is on file or of record in any public office, except such
as have been filed in favor of the Administrative Agent, for the ratable benefit
of the Secured Parties, pursuant to this Agreement or as are permitted by the
Senior Secured Credit Agreement (including without limitation subsection 8.3
thereof) or any other Loan Document or for which termination statements will be
delivered on the Closing Date.
4.2.2 Perfected First Priority Liens. (i) This Agreement is
effective to create, as collateral security for the Obligations of such Grantor,
valid and enforceable Liens on such Grantor's Collateral in favor of the
Administrative Agent, for the benefit of the Secured Parties, except as
enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditor's rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing.
(ii) Except with respect to (A) Liens on Equipment
constituting Fixtures, (B) any rights reserved in favor of the United States
government as required under law, (C) Liens upon Patents, Patent Licenses,
Trademarks and Trademark Licenses to the extent that (I) such Liens cannot be
perfected by the filing of financing statements under the Uniform Commercial
Code or by the filing and acceptance thereof in the United States Patent and
Trademark Office or (II) such Patents, Patent Licenses, Trademarks and Trademark
Licenses are not, individually or in the aggregate, material to the business of
the Borrower and its Subsidiaries taken as a whole, (D) Liens on uncertificated
securities, (E) Liens on Collateral the perfection of which requires filings in
or other actions under the laws of jurisdictions outside of the United States of
America, any State, territory or dependency thereof or the District of Columbia
(except to the extent that such filings or other actions have been made or
taken), (F) Liens on contracts or receivables on which the United States of
America or any department, agency, or instrumentality thereof is the obligor,
(G) Liens on Proceeds of receivables and Inventory, until transferred to or
deposited in the Collateral Proceeds Account (if any), and (H) claims of
creditors of Persons receiving goods included as Collateral for "sale or return"
within the meaning of Section 2-326 of the Uniform Commercial Code of the
applicable jurisdiction, upon filing of the financing statements delivered to
the Administrative Agent by such Grantor on the Effective Date in the
jurisdictions listed on Schedule 5.14 to the Senior Secured Credit Agreement
(which financing statements are in proper form for filing in such jurisdictions)
and the recording of the Mortgages (and the recording of any Patent and
Trademark Security Agreement, as set forth therein, and the making of filings
after the Effective Date in any other jurisdiction as may be necessary under any
Requirement of Law) and the delivery to, and continuing possession by, the
Administrative Agent of all Instruments, Chattel Paper and Documents a security
interest in which is perfected by possession, the Liens created pursuant to this
Agreement will constitute valid Liens on and, to the extent provided herein,
perfected security interests in such Grantor's Collateral (but as to the
Copyrights and
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Copyright Licenses and accounts arising therefrom, only to the extent the
Uniform Commercial Code of the relevant jurisdiction, from time to time in
effect, is applicable) in favor of the Administrative Agent for the benefit of
the Secured Parties, which Liens will be prior to all other Liens of all other
Persons, except for Liens permitted pursuant to the Loan Documents (including,
without limitation, those permitted to exist pursuant to subsection 8.3 of the
Senior Secured Credit Agreement), and which Liens are enforceable as such as
against all other Persons (except to the extent that the recording of an
assignment or other transfer of title to the Administrative Agent in the United
States Patent and Trademark Office may be necessary for enforceability, and
except, with respect to goods only, buyers in the ordinary course of business to
the extent provided in Section 9-307(1) of the Code), except as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting the enforcement of creditors' rights generally and by
general equitable principles (whether enforcement is sought by proceedings in
equity or at law) or by an implied covenant of good faith and fair dealing.
4.2.3 Chief Executive Office. On the date hereof, such
Grantor's jurisdiction of organization and the location of such Grantor's chief
executive office or sole place of business are specified on Schedule 3.
4.2.4 Inventory and Equipment. On the date hereof, such
Grantor's Inventory and Equipment (other than mobile goods) are kept at the
locations listed on Schedule 4.
4.2.5 Farm Products. None of such Grantor's Collateral
constitutes, or is the Proceeds of, Farm Products.
4.2.6 Accounts. The amount represented by such Grantor to the
Administrative Agent or the other Secured Parties from time to time as owing by
each account debtor or by all account debtors in respect of such Grantor's
Accounts will at such time be the correct amount, in all material respects,
actually owing by such account debtor or debtors thereunder, except to the
extent that appropriate reserves therefor have been established on the books of
such Grantor in accordance with GAAP. The places where such Grantor keeps its
records concerning such Grantor's Accounts are listed on Schedule 7 or such
other location or locations of which such Grantor shall have provided prior
written notice to the Administrative Agent pursuant to Section 5.2.5 hereof.
Unless otherwise indicated in writing to the Administrative Agent, each Account
of such Grantor arises out of a bona fide sale and delivery of goods or
rendition of services by such Grantor. Such Grantor has not given any account
debtor any deduction in respect of the amount due under any such Account, except
as such Grantor may otherwise advise the Administrative Agent in writing.
4.2.7 Intellectual Property. Schedule 5 lists all material
Trademarks and material Patents (including, without limitation, Trademarks and
Patents registered in the United States Patent and Trademark Office) owned by
such Grantor in its own name as of the date hereof and all material Trademark
Licenses and all material Patent Licenses (including,
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without limitation, material Trademark Licenses for registered Trademarks and
material Patent Licenses for registered Patents) owned by such Grantor in its
own name as of the date hereof.
4.3 Representations and Warranties of Each Pledgor. To induce
the Administrative Agent and the Lenders to enter into the Senior Secured Credit
Agreement and to induce the Lenders to make their respective extensions of
credit to the Borrower thereunder, each Pledgor hereby represents and warrants
to the Administrative Agent and each other Secured party that:
4.3.1 The shares of Pledged Stock pledged by such Pledgor
hereunder constitute (i) in the case of each Domestic Subsidiary, all the issued
and outstanding shares of all classes of the Capital Stock of each such Domestic
Subsidiary owned by such Pledgor and (ii) in the case of each Foreign Subsidiary
such percentage (not more than 65%) as is specified on Schedule 2 of all the
issued and outstanding shares of all classes of the Capital Stock of each such
Foreign Subsidiary.
4.3.2 All the shares of the Pledged Stock pledged by such
Pledgor hereunder have been duly and validly issued and are fully paid and
nonassessable.
4.3.3 Such Pledgor is the record and beneficial owner of, and
has good and valid title to, the Pledged Securities pledged by it hereunder,
free of any and all Liens or options in favor of, or claims of, any other
Person, except the security interest created by this Agreement and Liens imposed
by operation of law.
4.3.4 Upon delivery to the Administrative Agent of the
certificates evidencing the Pledged Securities held by such Pledgor, the
security interest created by this Agreement in such Pledged Collateral, assuming
the continuing possession of such Pledged Securities by the Administrative
Agent, will constitute a valid, perfected first priority security interest in
such Pledged Collateral to the extent provided in the Code, enforceable in
accordance with its terms against all creditors of such Pledgor and any persons
purporting to purchase such Pledged Collateral from such Pledgor, except as
enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing.
SECTION 5. COVENANTS
5.1 Covenants of Each Guarantor. Each Guarantor covenants and
agrees with the Administrative Agent and the other Secured Parties that, from
and after the date of this Agreement until the Loans, any Reimbursement
Obligations, and all other Obligations then due and owing, shall have been paid
in full, no Letter of Credit shall be outstanding and the Commitments shall have
terminated, such Guarantor shall take, or shall refrain from taking, as the case
may be, each action that is necessary to be taken or not taken, as the case
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may be, so that no Default or Event of Default is caused by the failure to take
such action or to refrain from taking such action by such Guarantor or any of
its Subsidiaries.
5.2 Covenants of Each Grantor. Each Grantor covenants and
agrees with the Administrative Agent and the other Secured Parties that, from
and after the date of this Agreement until the Loans, any Reimbursement
Obligations, and all other Obligations then due and owing, shall have been paid
in full, no Letter of Credit shall be outstanding and the Commitments shall have
terminated:
5.2.1 Delivery of Instruments and Chattel Paper. If any amount
payable under or in connection with any of such Grantor's Collateral shall be or
become evidenced by any Instrument or Chattel Paper, such Instrument or Chattel
Paper shall be promptly delivered to the Administrative Agent, duly indorsed in
a manner satisfactory to the Administrative Agent, to be held as Collateral
pursuant to this Agreement.
5.2.2 Maintenance of Insurance. (a) Such Grantor will
maintain, with financially sound and reputable companies, insurance policies (i)
insuring such Grantor's Inventory and Equipment against loss by fire, explosion,
theft and such other casualties as may be reasonably satisfactory to the
Administrative Agent and (ii) insuring such Grantor, the Administrative Agent
and the other Secured Parties against liability for personal injury and property
damage relating to such Inventory and Equipment, such policies to be in such
form and amounts and having such coverage as may be reasonably satisfactory to
the Administrative Agent.
(b) All such insurance shall (i) provide that no cancellation,
material reduction in amount or material change in coverage thereof shall be
effective until at least 30 days after receipt by the Administrative Agent of
written notice thereof, (ii) name the Administrative Agent as an additional
insured party or loss payee, (iii) include deductibles consistent with past
practice or otherwise reasonably satisfactory to the Administrative Agent and
(iv) be reasonably satisfactory in all other respects to the Administrative
Agent.
(c) Such Grantor (if the Borrower) shall deliver to the
Administrative Agent and the other Secured Parties reports of one or more
reputable insurance brokers of the individual insurance companies with respect
to such insurance as the Administrative Agent may from time to time reasonably
request.
5.2.3 Payment of Obligations. Such Grantor will pay and
discharge or otherwise satisfy at or before maturity or before they become
delinquent, as the case may be, all taxes, assessments and governmental charges
or levies imposed upon such Grantor's Collateral or in respect of income or
profits therefrom, as well as all claims of any kind (including, without
limitation, claims for labor, materials and supplies) against or with respect to
such Grantor's Collateral, except that no such tax, assessment, charge or levy
need be paid or satisfied if the amount or validity thereof is currently being
contested in good faith by appropriate proceedings, reserves in conformity with
GAAP with respect thereto have been
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provided on the books of such Grantor and such proceedings would not reasonably
be expected to result in the sale, forfeiture or loss of any material portion of
the Collateral or any interest therein.
5.2.4 Maintenance of Perfected Security Interest; Further
Documentation. (a) Such Grantor shall maintain the security interest created by
this Agreement in such Grantor's Collateral as a perfected security interest
having at least the priority described in Section 4.2.2 and shall defend such
security interest against the claims and demands of all Persons whomsoever.
(b) Such Grantor will furnish to the Administrative Agent from
time to time statements and schedules further identifying and describing such
Grantor's Collateral and such other reports in connection with such Grantor's
Collateral as the Administrative Agent may reasonably request in writing, all in
reasonable detail.
(c) At any time and from time to time, upon the written
request of the Administrative Agent, and at the sole expense of such Grantor,
such Grantor will promptly and duly execute and deliver such further instruments
and documents and take such further actions as the Administrative Agent may
reasonably request for the purpose of obtaining or preserving the full benefits
of this Agreement and of the rights and powers herein granted by such Grantor,
including, without limitation, the filing of any financing or continuation
statements under the Uniform Commercial Code (or other similar laws) in effect
in any jurisdiction with respect to the security interests created hereby.
5.2.5 Changes in Locations, Name, etc. Such Grantor will not,
except upon not less than 30 days' prior written notice to the Administrative
Agent and delivery to the Administrative Agent, if applicable, of a written
supplement to Schedule 4 showing any additional location at which such Grantor's
Inventory or Equipment shall be kept:
(i) permit any of such Grantor's Inventory or Equipment to be
kept at a location other than the location(s) applicable to such
Grantor listed on Schedule 4 (other than Inventory or Equipment being
conveyed, sold, leased, assigned, transferred or otherwise disposed of
as permitted by the Senior Secured Credit Agreement);
(ii) change the location of its chief executive office or sole
place of business from that referred to in Section 4.2.3; or
(iii) change its name, identity or corporate structure to such
an extent that any financing statement filed by the Administrative
Agent in connection with this Agreement would become misleading;
provided that, prior to taking any such action, or promptly after receiving a
written request therefor from the Administrative Agent, such Grantor shall
deliver to the Administrative Agent all additional executed financing statements
and other documents reasonably requested by the
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Administrative Agent to maintain the validity, perfection and priority of the
security interests provided for herein.
5.2.6 Notices. Such Grantor will advise the Administrative
Agent promptly, in reasonable detail, of:
(a) any Lien (other than security interests created hereby or
Liens permitted under the Senior Secured Credit Agreement) on any of such
Grantor's Collateral which would adversely affect the ability of the
Administrative Agent to exercise any of its remedies hereunder; and
(b) of the occurrence of any other event which could
reasonably be expected to have a material adverse effect on the aggregate value
of such Grantor's Collateral or on the security interests created hereby.
5.2.7 Pledged Securities. In the case of each Grantor which is
an Issuer, such Issuer agrees that (i) it will be bound by the terms of this
Agreement relating to the Pledged Stock issued by it and will comply with such
terms insofar as such terms are applicable to it, (ii) it will notify the
Administrative Agent promptly in writing of the occurrence of any of the events
described in Section 5.3.1 with respect to the Pledged Stock issued by it and
(iii) the terms of Sections 6.3(c) and 6.7 shall apply to it, mutatis mutandis,
with respect to all actions that may be required of it pursuant to Section
6.3(c) or 6.7 with respect to the Pledged Stock issued by it.
5.2.8 Accounts. (a) Other than in the ordinary course of
business, such Grantor will not (i) grant any extension of the time of payment
of any of such Grantor's Accounts, (ii) compromise or settle any such Account
for less than the full amount thereof, (iii) release, wholly or partially, any
Person liable for the payment of any Account, (iv) allow any credit or discount
whatsoever on any such Account or (v) amend, supplement or modify any Account in
any manner that could adversely affect the value thereof.
(b) Such Grantor will deliver to the Administrative Agent a
copy of each material demand, notice or document received by it that questions
or calls into doubt the validity or enforceability of more than 10% of the
aggregate amount of the then outstanding Accounts.
5.2.9 Maintenance of Records. Such Grantor will keep and
maintain at its own cost and expense reasonably satisfactory and complete
records of its Collateral, including, without limitation, a record of all
payments received and all credits granted with respect to such Collateral, and
shall xxxx such records to evidence this Agreement and the Liens and the
security interests created hereby. For the Administrative Agent's and the other
Secured Parties' further security, the Administrative Agent, for the benefit of
the Secured Parties, shall have a security interest in all of such Grantor's
books and records pertaining to such Grantor's Collateral.
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5.2.10 Acquisition of Intellectual Property. Within 45 days
after the end of each calendar quarter, such Grantor will notify the
Administrative Agent of any acquisition by such Grantor of (i) any material
registration of Copyright, Patent or Trademark or (ii) any exclusive rights
under a material Copyright License, Patent License or Trademark License, and
shall take such actions as may be reasonably requested by the Administrative
Agent (but only to the extent such actions are within such Grantor's control) to
perfect the security interest granted to the Administrative Agent and the other
Secured Parties therein (including, without limitation, (x) the execution and
delivery of a Patent and Trademark Security Agreement (or amendments to any such
agreement previously executed or delivered by such
Grantor) or other comparable agreements with respect to Copyrights or Copyright
Licenses and (y) the making of appropriate filings (I) of financing statements
under the Uniform Commercial Code of any applicable jurisdiction and/or (II) in
the United States Patent and Trademark Office, or with respect to Copyrights and
Copyright Licenses, other applicable office).
5.2.11 Protection of Trade Secrets. Such Grantor shall take
all steps which it deems commercially reasonable to preserve and protect the
secrecy of all material Trade Secrets of such Grantor.
5.3 Covenants of Each Pledgor. Each Pledgor covenants and
agrees with the Administrative Agent and the other Secured Parties that, from
and after the date of this Agreement until the Loans, any Reimbursement
Obligations, and all other Obligations then due and owing shall have been paid
in full, no Letter of Credit shall be outstanding and the Commitments shall have
terminated:
5.3.1 If such Pledgor shall become entitled to receive or
shall receive any stock certificate (including, without limitation, any
certificate representing a stock dividend or a distribution in connection with
any reclassification, increase or reduction of capital or any certificate issued
in connection with any reorganization), option or rights in respect of the
Capital Stock of any Issuer, whether in addition to, in substitution of, as a
conversion of, or in exchange for, any shares of the Pledged Stock, or otherwise
in respect thereof, such Pledgor shall accept the same as the agent of the
Administrative Agent and the other Secured Parties, hold the same in trust for
the Administrative Agent and deliver the same forthwith to the Administrative
Agent in the exact form received, duly indorsed by such Pledgor to the
Administrative Agent, if required, together with an undated stock power covering
such certificate duly executed in blank by such Grantor and with, if the
Administrative Agent so requests, signature guaranteed, to be held by the
Administrative Agent, subject to the terms hereof, as additional collateral
security for the Obligations (provided that in no event shall there be pledged,
nor shall any Pledgor be required to pledge, more than 65% of any series of the
outstanding Capital Stock of any Foreign Subsidiary pursuant to this Agreement).
Any sums paid upon or in respect of the Pledged Securities upon the liquidation
or dissolution of any Issuer or Maker (except any liquidation or dissolution of
any Subsidiary of the Borrower in accordance with the Senior Secured Credit
Agreement) shall be paid over to the Administrative Agent to be held by it
hereunder as additional collateral security for the Obligations, and in case any
distribution of capital shall be made on or in respect of the
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Pledged Stock or any property shall be distributed upon or with respect to the
Pledged Stock pursuant to the recapitalization or reclassification of the
capital of any Issuer or pursuant to the reorganization thereof, the property so
distributed shall, unless otherwise subject to a perfected security interest in
favor of the Administrative Agent, be delivered to the Administrative Agent to
be held by it hereunder as additional collateral security for the Obligations.
If any sums of money or property so paid or distributed in respect of the
Pledged Securities shall be received by such Pledgor, such Pledgor shall, until
such money or property is paid or delivered to the Administrative Agent, hold
such money or property in trust for the Secured Parties, segregated from other
funds of such Pledgor, as additional collateral security for the Obligations.
5.3.2 Without the prior written consent of the Administrative
Agent, such Pledgor will not (except pursuant to a transaction permitted by the
Senior Secured Credit Agreement) (i) vote to enable, or take any other action to
permit, any Issuer to issue any stock or other equity securities of any nature
or to issue any other securities convertible into or granting the right to
purchase or exchange for any stock or other equity securities of any nature of
any Issuer, (ii) sell, assign, transfer, exchange, or otherwise dispose of, or
grant any option with respect to, the Pledged Securities or Proceeds thereof or
(iii) create, incur or permit to exist any Lien or option in favor of, or any
claim of any Person with respect to, any of the Pledged Securities or Proceeds
thereof, or any interest therein, except for the security interests created by
this Agreement or Liens arising by operation of law.
5.3.3 Such Pledgor shall maintain the security interest
created by this Agreement in such Pledgor's Pledged Collateral as a perfected
security interest having at least the priority described in Section 4.3.4 and
shall defend such security interest against the claims and demands of all
Persons whomsoever. At any time and from time to time, upon the written request
of the Administrative Agent, and at the sole expense of such Pledgor, such
Pledgor will promptly and duly execute and deliver such further instruments and
documents and take such further actions as the Administrative Agent may
reasonably request for the purpose of obtaining or preserving the full benefits
of this Agreement and of the rights and powers herein granted by such Pledgor.
5.4 Covenants of Holdings. Holdings covenants and agrees with
the Administrative Agent and the other Secured Parties that, from and after the
date of this Agreement until the Loans, any Reimbursement Obligations, and all
other Obligations then due and owing have been paid in full, no Letter of Credit
shall be outstanding and the Commitments shall have terminated:
5.4.1 Holding shall not conduct or otherwise engage, in any
business or operations other than (i) transactions contemplated by the Loan
Documents or the provision of administrative, legal, accounting and management
services to or on behalf of the Borrower or any of its Subsidiaries, (ii) the
ownership of the Capital Stock of the Borrower (or any successor thereto), and
the exercise of rights and performance of obligations in connection therewith,
(iii) the entry into, and exercise of rights and performance of obligations in
respect of, (A) the Transaction Documents and Senior Subordinated Notes
Documents to which
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Holdings is a party, this Guarantee and Collateral Agreement and the other Loan
Documents to which Holdings is a party, and any other agreement to which
Holdings is a party on the date hereof, in each case as amended, supplemented,
waived or otherwise modified from time to time, and any refinancings,
refundings, renewals or extensions thereof, (B) contracts and agreements with
officers, directors and employees of the Holdings or a Subsidiary thereof
relating to their employment or directorships, (C) insurance policies and
related contracts and agreements, and (D) equity subscription agreements,
registration rights agreements, voting and other stockholder agreements,
engagement letters, underwriting agreements and other agreements in respect of
its equity securities or any offering, issuance or sale thereof, (iv) the
offering, issuance and sale of its equity securities, (v) the filing of
registration statements, and compliance with applicable reporting and other
obligations, under federal, state or other securities laws, (vi) the listing of
its equity securities and compliance with applicable reporting and other
obligations in connection therewith, (vii) the retention of transfer agents,
private placement agents, underwriters, counsel, accountants and other advisors
and consultants, (viii) the performance of obligations under and compliance with
its certificate of incorporation and by-laws, or any applicable law, ordinance,
regulation, rule, order, judgment, decree or permit, including, without
limitation, as a result of or in connection with the activities of the Borrower
and its Subsidiaries, (ix) the incurrence and payment of its operating and
business expenses and any taxes for which it may be liable, and (x) other
activities incidental or related to the foregoing.
5.4.2 Holdings shall not own, lease, manage or otherwise
operate any properties or assets (other than in connection with the activities
described in Section 5.4.1 above), or incur, create, assume or suffer to exist
any Indebtedness or Guarantee Obligations of Holdings (other than such as may be
incurred, created or assumed or exist in connection with the activities
described in Section 5.4.1 above.
SECTION 6. REMEDIAL PROVISIONS
6.1 Certain Matters Relating to Accounts. (a) At any time and
from time to time after the occurrence and during the continuance of an Event of
Default, the Administrative Agent shall have the right to make test
verifications of the Accounts in any manner and through any medium that it
reasonably considers advisable, and the relevant Grantor 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 after the
occurrence and during the continuance of an Event of Default, upon the
Administrative Agent's reasonable request and at the expense of the relevant
Grantor, such Grantor shall cause independent public accountants or others
reasonably 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.
(b) The Administrative Agent hereby authorizes each Grantor to
collect such Grantor's Accounts and the Administrative Agent may curtail or
terminate said authority at any time after the occurrence and during the
continuance of an Event of Default. If required
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by the Administrative Agent at any time after the occurrence and during the
continuance of an Event of Default, any Proceeds constituting collections of
such Accounts, when collected by such Grantor (excluding any such collections
through the Lockbox System), (i) shall be forthwith (and, in any event, within
two Business Days) deposited by such Grantor in the exact form received, duly
indorsed by such Grantor to the Administrative Agent if required, in the
Collateral Proceeds Account established by such Grantor maintained under the
sole dominion and control of the Administrative Agent, subject to withdrawal by
the Administrative Agent for the account of the Secured Parties only as provided
in Section , and (ii) until so turned over, shall be held by such Grantor in
trust for the Administrative Agent and the other Secured Parties, segregated
from other funds of such Grantor. Each such deposit of Proceeds of Accounts
shall be accompanied by a report identifying in reasonable detail the nature and
source of the payments included in the deposit. All Proceeds constituting
collections of Accounts while held by the Collateral Account Bank (or by any
Guarantor in trust for the benefit of the Administrative Agent and the other
Secured Parties) shall continue to be collateral security for all of the
Obligations and shall not constitute payment thereof until applied as
hereinafter provided. At any time when an Event of Default has occurred and is
continuing, at the Administrative Agent's election, the Administrative Agent may
apply all or any part of the funds on deposit in the Collateral Proceeds Account
established by the relevant Grantor to the payment of the Obligations of such
Grantor then due and owing, such application to be made as set forth in Section
6.5 hereof. So long as no Event of Default has occurred and is continuing, the
funds on deposit in the Collateral Proceeds Account shall be remitted as
provided in Section 6.9 hereof. At any time when an Event of Default has
occurred and is continuing, at the Administrative Agent's request, each Grantor
shall deliver to the Administrative Agent all original and other documents
evidencing, and relating to, the agreements and transactions which gave rise to
such Grantor's Accounts, including, without limitation, all statements relating
to such Grantor's Accounts.
(c) At any time and from time to time after the occurrence and
during the continuance of an Event of Default, at the Administrative Agent's
request, each Grantor shall deliver to the Administrative Agent all original and
other documents evidencing, and relating to, the agreements and transactions
which gave rise to such Grantor's Accounts, including, without limitation, all
original orders, invoices and shipping receipts.
(d) Lockbox System; Collateral Proceeds Account. (i) Solely to
the extent required under subsection 8.18(a) of the Senior Secured Credit
Agreement, on or prior to the date required pursuant to such subsection 8.18(a),
each Grantor shall (subject to subsection 8.18(a) of the Senior Secured Credit
Agreement) establish or cause to be established in the name of the
Administrative Agent, and subject to the control of the Administrative Agent
pursuant to such Grantor's Lockbox Agreements, for the benefit of the
Administrative Agent and the other Secured Parties, such Grantor's Lockbox
System into which the Proceeds of all such Grantor's Accounts (except as
permitted under and in accordance with subsection 8.18(a) of the Senior Secured
Credit Agreement) shall be deposited and forwarded to the Collateral Account
Bank in accordance with and to the extent and when required under such Lockbox
Agreements. On and after the date, if any, on which any Grantor is required to
establish any
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Lockbox System for so long as such Grantor is required to maintain such system
(subject to subsection 8.18(a) of the Senior Secured Credit Agreement), (x) such
Grantor shall ensure that all account debtors in respect of such Grantor's
Accounts payable in Dollars shall have been given instructions reasonably
satisfactory to the Administrative Agent directing such account debtors to make
all payments on such Accounts by means of deposits into such Grantor's Lockbox
System, (y) without the prior consent of the Administrative Agent (which consent
shall not be unreasonably withheld), such Grantor shall not, in a manner
materially adverse to the Secured Parties, change the form of any such
instructions given to account debtors, and (z) unless and until the
Administrative Agent shall have advised such Grantor to the contrary, such
Grantor shall, and the Administrative Agent hereby authorizes such Grantor to,
enforce and collect all amounts owing on such Grantor's Accounts, for the
benefit and on behalf of the Administrative Agent and the other Secured Parties
in accordance with and subject to the provisions of such Grantor's Lockbox
Agreements; provided, however, that such privilege shall automatically be
suspended upon the occurrence and during the continuance of an Event of Default
specified in Section 9(f) of the Senior Secured Credit Agreement with respect to
such Grantor and may at the option of the Administrative Agent be terminated
upon the occurrence and during the continuance of any other Event of Default
with respect to such Grantor or any other Grantor.
(ii) All Proceeds of such Grantor's Accounts which have been
received on any Business Day through such Grantor's Lockbox System will be
transferred into such Grantor's Collateral Proceeds Account on such Business Day
to the extent required by the applicable Lockbox Agreement. All of such
Grantor's Proceeds received on any Business Day by the Collateral Account Bank
pursuant to paragraph (b) above will be transferred into such Grantor's
Collateral Proceeds Account on such Business Day. Such Collateral Proceeds
Account is, and shall remain, under the sole dominion and control of the
Administrative Agent. Each Grantor acknowledges and agrees that (A) such Grantor
has no right of withdrawal from its Collateral Proceeds Account, (B) the funds
on deposit in such Grantor's Collateral Proceeds Account shall be collateral
security for all of such Grantor's Obligations and (C) upon the occurrence and
during the continuance of an Event of Default, at the Administrative Agent's
election, the funds on deposit in such Grantor's Collateral Proceeds Account may
be applied by the Administrative Agent to the payment of such Grantor's
Obligations then due and owing, such application to be made in the order of
priority set forth in Section 6.5 hereof.
(e) General Fund Account. So long as no Event of Default has
occurred and is continuing, and whether or not any Lockbox System shall have
been established or maintained, the Administrative Agent shall instruct the
Collateral Account Bank to promptly remit any funds on deposit in each Grantor's
Collateral Proceeds Account to such Grantor's General Fund Account. In the event
that an Event of Default has occurred and is continuing, the Administrative
Agent and the Grantors agree that the Administrative Agent, at its option, may
require that each Collateral Proceeds Account be established at The Chase
Manhattan Bank. Each Grantor shall have the right, at any time and from time to
time, to withdraw such of its
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own funds from its own General Fund Account, and to maintain such balances in
its General Fund Account, as it shall deem to be necessary or desirable.
(f) Restructuring of Deposit Accounts. If (a) any Collateral
Proceeds Account is maintained at a Collateral Account Bank located in a state
within the United States in which Article 9 of the Uniform Commercial Code in
effect in such state has been expressly made applicable to (and only for so long
as it is applicable to) demand deposit accounts and all filings have been made
in such state which are necessary to perfect the Secured Parties' security
interest in such Collateral Proceeds Account or (b) after the Effective Date the
relevant Grantor demonstrates to the Administrative Agent, and the
Administrative Agent in its sole discretion agrees, that the costs associated
with maintaining both a Collateral Proceeds Account and a General Fund Account
outweigh any benefits to the Secured Parties in terms of any additional
protection to their rights in such Grantor's Collateral that could not be
achieved with the use of a single account, then upon the request of such
Grantor, the Administrative Agent may amend this Agreement to delete the
requirement that a separate General Fund Account be maintained and provide that
such Grantor be entitled to withdraw funds on deposit in such Collateral
Proceeds Account at any time so long as no Event of Default has occurred and is
continuing.
6.2 Communications with Obligors; Grantors Remain Liable. (a)
The Administrative Agent in its own name or in the name of others may at any
time and from time to time after the occurrence and during the continuance of an
Event of Default communicate with obligors under the Accounts and parties to the
Contracts (in each case, to the extent constituting Collateral) to verify with
them to the Administrative Agent's satisfaction the existence, amount and terms
of any Receivables or Contracts.
(b) Upon the request of the Administrative Agent at any time
after the occurrence and during the continuance of an Event of Default, each
Grantor shall notify obligors on such Grantor's Accounts and parties to such
Grantor's Contracts (in each case, to the extent constituting Collateral) that
such Accounts and such Contracts have been assigned to the Administrative Agent,
for the ratable benefit of the Secured Parties, and that payments in respect
thereof shall be made directly to the Administrative Agent.
(c) Anything herein to the contrary notwithstanding, each
Grantor shall remain liable under each of such Grantor's 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
thereto. 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 Agreement or the receipt by the
Administrative Agent or any other Secured Party of any payment relating thereto,
nor shall the Administrative Agent or any other Secured Party be obligated in
any manner to perform any of the obligations of any Grantor 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 thereunder, to present or
file any
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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.
6.3 Pledged Stock. (a) Unless an Event of Default shall have
occurred and be continuing and the Administrative Agent shall have given notice
to the relevant Pledgor of the Administrative Agent's intent to exercise its
corresponding rights pursuant to Section 6.3(b), each Pledgor shall be permitted
to receive all cash dividends paid in respect of the Pledged Stock and all
payments made in respect of the Pledged Notes, to the extent permitted in the
Senior Secured Credit Agreement, and to exercise all voting and corporate rights
with respect to the Pledged Stock; provided, however, that no vote shall be cast
or corporate right exercised or such other action taken (other than in
connection with a transaction expressly permitted by the Senior Secured Credit
Agreement) which, in the Administrative Agent's reasonable judgment, would
materially impair the Pledged Collateral or the related rights or remedies of
the Secured Parties or which would be inconsistent with or result in any
violation of any provision of the Senior Secured Credit Agreement, this
Agreement or any other Loan Document.
(b) If an Event of Default shall occur and be continuing and
the Administrative Agent shall give notice of its intent to exercise such rights
to the relevant Pledgor or Pledgors, (i) the Administrative Agent shall have the
right to receive any and all cash dividends, payments or other Proceeds paid in
respect of the Pledged Stock and make application thereof to the Obligations in
such order as the Administrative Agent may determine, and (ii) any or all of the
Pledged Stock shall be registered in the name of the Administrative Agent or its
nominee, and the Administrative Agent or its nominee may thereafter exercise (x)
all voting, corporate and other rights pertaining to such Pledged Stock at any
meeting of shareholders of the relevant Issuer or Issuers or otherwise and (y)
any and all rights of conversion, exchange, subscription and any other rights,
privileges or options pertaining to such Pledged Stock as if it were the
absolute owner thereof (including, without limitation, the right to exchange at
its discretion any and all of the Pledged Stock upon the merger, consolidation,
reorganization, recapitalization or other fundamental change in the corporate
structure of any Issuer, or upon the exercise by the relevant Pledgor or the
Administrative Agent of any right, privilege or option pertaining to such
Pledged Stock, and in connection therewith, the right to deposit and deliver any
and all of the Pledged Stock with any committee, depositary, transfer agent,
registrar or other designated agency upon such terms and conditions as the
Administrative Agent may reasonably determine), all without liability (other
than for its gross negligence or willful misconduct) except to account for
property actually received by it, but the Administrative Agent shall have no
duty to any Pledgor to exercise any such right, privilege or option and shall
not be responsible for any failure to do so or delay in so doing, provided that
the Administrative Agent shall not exercise any voting or other consensual
rights pertaining to the Pledged Stock in any way that would constitute an
exercise of the remedies described in Section 7 other than in accordance with
Section 7.
(c) Each Pledgor hereby authorizes and instructs each Issuer
or Maker of any Pledged Securities pledged by such Pledgor hereunder to (i)
comply with any instruction
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received by it from the Administrative Agent in writing that (x) states that an
Event of Default has occurred and (y) is otherwise in accordance with the terms
of this Agreement, without any other or further instructions from such Pledgor,
and each Pledgor agrees that each Issuer or Maker shall be fully protected in so
complying, and (ii) unless otherwise expressly permitted hereby, pay any
dividends or other payments with respect to the Pledged Securities directly to
the Administrative Agent.
6.4 Proceeds to be Turned Over To Administrative Agent. In
addition to the rights of the Administrative Agent and the other Secured Parties
specified in Section 6.1 with respect to payments of Accounts, if an Event of
Default shall occur and be continuing, and the Administrative Agent shall have
instructed any Grantor to do so, all Proceeds received by such Grantor
consisting of cash, checks and other Cash Equivalent items shall be held by such
Grantor in trust for the Administrative Agent and the other Secured Parties,
segregated from other funds of such Grantor, and shall, forthwith upon receipt
by such Grantor, be turned over to the Administrative Agent in the exact form
received by such Grantor (duly indorsed by such Grantor to the Administrative
Agent, if required). All Proceeds received by the Administrative Agent hereunder
shall be held by the Administrative Agent in the relevant Collateral Proceeds
Account maintained under its sole dominion and control. All Proceeds while held
by the Administrative Agent in such Collateral Proceeds Account (or by such
Grantor in trust for the Administrative Agent and the other Secured Parties)
shall continue to be held as collateral security for all the Obligations and
shall not constitute payment thereof until applied as provided in Section 6.5.
6.5 Application of Proceeds. It is agreed that if an Event of
Default shall occur and be continuing, any and all Proceeds of the relevant
Granting Party's Security Collateral received by the Administrative Agent
(whether from the relevant Granting Party or otherwise) shall be held by the
Administrative Agent for the benefit of the Secured Parties as collateral
security for the Obligations of the relevant Granting Party (whether matured or
unmatured), and/or then or at any time thereafter may, in the sole discretion of
the Administrative Agent, be applied by the Administrative Agent against the
Obligations of the relevant Granting Party then due and owing in the following
order of priority:
FIRST, to the payment of all reasonable costs and expenses
incurred by the Administrative Agent in connection with this Agreement,
the Senior Secured Credit Agreement, any other Loan Document or any of
the Obligations of the relevant Granting Party, including, without
limitation, all court costs and the reasonable fees and expenses of its
agents and legal counsel, and any other reasonable costs or expenses
incurred in connection with the exercise by the Administrative Agent of
any right or remedy under this Agreement, the Senior Secured Credit
Agreement, or any other Loan Document;
SECOND, to the ratable satisfaction of all other Obligations
of the relevant Granting Party; and
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THIRD, to the relevant Granting Party or its successors or
assigns, or to whomsoever may be lawfully entitled to receive the same.
6.6 Code and Other Remedies. If an Event of Default shall
occur and be continuing, the Administrative Agent, on behalf of the Secured
Parties, may exercise, in addition to all other rights and remedies granted to
them in this Agreement and in any other instrument or agreement securing,
evidencing or relating to the Obligations, all rights and remedies of a secured
party under the Code or any other applicable law. Without limiting the
generality of the foregoing, to the extent permitted by applicable law, the
Administrative Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon any Granting Party or any other
Person (all and each of which demands, defenses, advertisements and notices are
hereby waived), may in such circumstances forthwith collect, receive,
appropriate and realize upon the Security Collateral, or any part thereof,
and/or may forthwith sell, lease, assign, give option or options to purchase, or
otherwise dispose of and deliver the Security Collateral or any part thereof (or
contract to do any of the foregoing), in one or more parcels at public or
private sale or sales, at any exchange, broker's board or office of the
Administrative Agent or any other Secured Party or elsewhere upon such terms and
conditions as it may deem advisable and at such prices as it may deem best, for
cash or on credit or for future delivery without assumption of any credit risk.
The Administrative Agent or any other Secured Party shall have the right upon
any such public sale or sales, and, to the extent permitted by law, upon any
such private sale or sales, to purchase the whole or any part of the Security
Collateral so sold, free of any right or equity of redemption in any Granting
Party, which right or equity is hereby waived or released. Each Granting Party
further agrees, at the Administrative Agent's request, to assemble the Security
Collateral and make it available to the Administrative Agent at places which the
Administrative Agent shall reasonably select, whether at such Granting Party's
premises or elsewhere. The Administrative Agent shall apply the net proceeds of
any action taken by it pursuant to this Section 6.6, after deducting all
reasonable costs and expenses of every kind incurred in connection therewith or
incidental to the care or safekeeping of any of the Security Collateral or in
any way relating to the Security Collateral or the rights of the Administrative
Agent and the other Secured Parties hereunder, including, without limitation,
reasonable attorneys' fees and disbursements, to the payment in whole or in part
of the Obligations of the relevant Granting Party, in the order of priority
specified in Section 6.5 above, and only after such application and after the
payment by the Administrative Agent of any other amount required by any
provision of law, including, without limitation, Section 9-504(1)(c) of the
Code, need the Administrative Agent account for the surplus, if any, to any
Granting Party. To the extent permitted by applicable law, each Granting Party
waives all claims, damages and demands it may acquire against the Administrative
Agent or any other Secured Party arising out of the exercise by them of any
rights hereunder, except to the extent arising as a result of the gross
negligence or willful misconduct of the Administrative Agent or such other
Secured Party. If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable and
proper if given at least 10 days before such sale or other disposition.
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6.7 Registration Rights. (a) If the Administrative Agent shall
determine to exercise its right to sell any or all of the Pledged Stock pursuant
to Section 6.6, and if in the reasonable opinion of the Administrative Agent it
is necessary or reasonably advisable to have the Pledged Stock, or that portion
thereof to be sold, registered under the provisions of the Securities Act, the
relevant Pledgor will use its reasonable best efforts to cause the Issuer
thereof to (i) execute and deliver, and use its best efforts to cause the
directors and officers of such Issuer to execute and deliver, all such
instruments and documents, and do or cause to be done all such other acts as may
be, in the opinion of the Administrative Agent, necessary or advisable to
register such Pledged Stock, or that portion thereof to be sold, under the
provisions of the Securities Act, (ii) use its best efforts to cause the
registration statement relating thereto to become effective and to remain
effective for a period of one year from the date of the first public offering of
such Pledged Stock, or that portion thereof to be sold, and (iii) make all
amendments thereto and/or to the related prospectus which, in the reasonable
opinion of the Administrative Agent, are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules and
regulations of the Securities and Exchange Commission applicable thereto. Such
Pledgor agrees to cause such Issuer to comply with the provisions of the
securities or "Blue Sky" laws of any and all jurisdictions which the
Administrative Agent shall reasonably designate and to make available to its
security holders, as soon as practicable, an earnings statement (which need not
be audited) which will satisfy the provisions of Section 11(a) of the Securities
Act.
(b) Such Pledgor recognizes that the Administrative Agent may
be unable to effect a public sale of any or all such Pledged Stock, by reason of
certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers which will be obliged
to agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof. Such
Pledgor acknowledges and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The Administrative
Agent shall be under no obligation to delay a sale of any of the Pledged Stock
for the period of time necessary to permit the Issuer thereof to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if such Issuer would agree to do so.
(c) Such Pledgor agrees to use its best efforts to do or cause
to be done all such other acts as may be necessary to make such sale or sales of
all or any portion of such Pledged Stock pursuant to this Section 6.7 valid and
binding and in compliance with any and all other applicable Requirements of Law.
Such Pledgor further agrees that a breach of any of the covenants contained in
this Section 6.7 will cause irreparable injury to the Administrative Agent and
the Lenders, that the Administrative Agent and the Lenders have no adequate
remedy at law in respect of such breach and, as a consequence, that each and
every covenant contained in this Section 6.7 shall be specifically enforceable
against such Pledgor, and to the extent permitted by applicable law, such
Pledgor hereby waives and agrees not to assert any
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defenses against an action for specific performance of such covenants except for
a defense that no Event of Default has occurred under the Senior Secured Credit
Agreement.
6.8 Waiver; Deficiency. Each Granting Party (other than the
Borrower) waives and agrees not to assert any rights or privileges which it may
acquire under Section 9- 112 of the Code, to the extent permitted by applicable
law. Each Granting Party shall remain liable for any deficiency if the proceeds
of any sale or other disposition of the Security Collateral are insufficient to
pay its Obligations and the fees and disbursements of any attorneys employed by
the Administrative Agent or any other Secured Party to collect such deficiency.
SECTION 7. THE ADMINISTRATIVE AGENT
7.1 Administrative Agent's Appointment as Attorney-in-Fact,
etc. (a) Each Granting Party hereby irrevocably constitutes and 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 Granting Party and in the
name of such Granting Party or in its own name, for the purpose of carrying out
the terms of this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be reasonably necessary
or desirable to accomplish the purposes of this Agreement to the extent
permitted by applicable law. Without limiting the generality of the foregoing,
at any time when an Event of Default has occurred and is continuing (in each
case to the extent permitted by applicable law), (x) each Pledgor hereby gives
the Administrative Agent the power and right, on behalf of such Pledgor, without
notice or assent by such Pledgor, to execute, in connection with any sale
provided for in Section 6.6 or 6.7, any indorsements, assessments or other
instruments of conveyance or transfer with respect to such Pledgor's Pledged
Collateral, and (y) 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:
(i) in the name of such Grantor or its own name, or otherwise,
take possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under
any Account of such Grantor or with respect to any other Collateral of
such Grantor and file any claim or take any other action or proceeding
in any court of law or equity or otherwise deemed appropriate by the
Administrative Agent for the purpose of collecting any and all such
moneys due under any Account of such Grantor or with respect to any
other Collateral of such Grantor whenever payable;
(ii) in the case of any Copyright, Patent or Trademark
constituting Collateral of such Grantor, 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 such Copyright, Patent or
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Trademark and the goodwill and general intangibles of such Grantor
relating thereto or represented thereby;
(iii) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral of such Grantor, 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; and
(iv) (i) direct any party liable for any payment under any of
the Collateral of such Grantor 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, receive payment of and 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 of such Grantor; (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 of
such Grantor; (iv) commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction
to collect the Collateral of such Grantor or any portion thereof and to
enforce any other right in respect of any Collateral of such Grantor;
(v) defend any suit, action or proceeding brought against such Grantor
with respect to any Collateral of such Grantor; (vi) settle, compromise
or adjust any such suit, action or proceeding and, in connection
therewith, to give such discharges or releases as the Administrative
Agent may deem appropriate; (vii) subject to any existing reserved
rights or licenses, assign any Copyright, Patent or Trademark
constituting Collateral of such Grantor (along with the goodwill of the
business to which any such Copyright, Patent or Trademark pertains),
for such term or terms, on such conditions, and in such manner, as the
Administrative Agent shall in its sole discretion determine; and (viii)
generally, sell, transfer, pledge and make any agreement with respect
to or otherwise deal with any of the Collateral of such Grantor 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 which the Administrative Agent deems
necessary to protect, preserve or realize upon the Collateral of such
Grantor and the Administrative Agent's and the other Secured Parties'
security interests therein and to effect the intent of this Agreement,
all as fully and effectively as such Grantor might do.
Anything in this Section 7.1(a) to the contrary notwithstanding, the
Administrative Agent agrees that it will not exercise any rights under the power
of attorney provided for in this Section 7.1(a) unless an Event of Default shall
have occurred and be continuing.
(b) If any Granting Party fails to perform or comply with any
of its agreements contained herein, the Administrative Agent, at its option, but
without any obligation so to do, may perform or comply, or otherwise cause
performance or compliance, with such agreement.
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(c) The reasonable expenses of the Administrative Agent
incurred in connection with actions undertaken as provided in this Section 7.1,
together with interest thereon at a rate per annum equal to the rate per annum
at which interest would then be payable on past due ABR Loans which are Term
Loans under the Senior Secured Credit Agreement, from the date of payment by the
Administrative Agent to the date reimbursed by the relevant Granting Party,
shall be payable by such Granting Party to the Administrative Agent on demand.
(d) Each Granting Party hereby ratifies all that said
attorneys shall lawfully do or cause to be done by virtue hereof. All powers,
authorizations and agencies contained in this Agreement are coupled with an
interest and are irrevocable as to the relevant Granting Party until this
Agreement is terminated as to such Granting Party, and the security interests in
the Security Collateral of such Granting Party created hereby are released.
7.2 Duty of Administrative Agent. The Administrative Agent's
sole duty with respect to the custody, safekeeping and physical preservation of
the Security Collateral in its possession, under Section 9-207 of the Code or
otherwise, shall be to deal with it in the same manner as the Administrative
Agent deals with similar property for its own account. Neither the
Administrative Agent, any other Secured Party nor any of their respective
officers, directors, employees or agents shall be liable for failure to demand,
collect or realize upon any of the Security Collateral or for any delay in doing
so or shall be under any obligation to sell or otherwise dispose of any Security
Collateral upon the request of any Granting Party or any other Person or to take
any other action whatsoever with regard to the Security Collateral or any part
thereof. The powers conferred on the Administrative Agent and the other Secured
Parties hereunder are solely to protect the Administrative Agent's and the other
Secured Parties' interests in the Security Collateral and shall not impose any
duty upon the Administrative Agent or any other Secured Party to exercise any
such powers. The Administrative Agent and the other Secured Parties shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
employees or agents shall be responsible to any Granting Party for any act or
failure to act hereunder, except for their own gross negligence or willful
misconduct.
7.3 Execution of Financing Statements. Pursuant to Section
9-402 of the Code and any other applicable law, each Granting Party authorizes
the Administrative Agent to file or record financing statements and other filing
or recording documents or instruments with respect to such Granting Party's
Security Collateral without the signature of such Granting Party in such form
and in such offices as the Administrative Agent reasonably determines
appropriate to perfect the security interests of the Administrative Agent under
this Agreement. A photographic or other reproduction of this Agreement shall be
sufficient as a financing statement or other filing or recording document or
instrument for filing or recording in any jurisdiction.
7.4 Authority of Administrative Agent. Each Granting Party
acknowledges that the rights and responsibilities of the Administrative Agent
under this Agreement with respect to any action taken by the Administrative
Agent or the exercise or non-exercise by the
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Administrative Agent of any option, voting right, request, judgment or other
right or remedy provided for herein or resulting or arising out of this
Agreement or any amendment, supplement or other modification of this Agreement
shall, as between the Administrative Agent and the Secured Parties, be governed
by the Senior Secured Credit Agreement and by such other agreements with respect
thereto as may exist from time to time among them, but, as between the
Administrative Agent and the Granting Parties the Administrative Agent shall be
conclusively presumed to be acting as agent for the Secured Parties with full
and valid authority so to act or refrain from acting, and no Granting Party
shall be under any obligation, or entitlement, to make any inquiry respecting
such authority.
7.5 Right Of Inspection. Upon reasonable written advance
notice to any Grantor and at reasonable intervals, or at any time and from time
to time after the occurrence and during the continuation of an Event of Default,
the Administrative Agent shall have reasonable access during normal business
hours to all the books, correspondence and records of such Granting Party, and
the Administrative Agent and its representatives may examine the same, and to
the extent reasonable take extracts therefrom and make photocopies thereof, and
such Granting Party agrees to render to the Administrative Agent, at such
Granting Party's reasonable cost and expense, such clerical and other assistance
as may be reasonably requested with regard thereto. The Administrative Agent and
its representatives shall also have the right, upon reasonable advance written
notice to such Granting Party, to enter during normal business hours into and
upon any premises owned, leased or operated by such Granting Party where any of
such Granting Party's Inventory or Equipment is located for the purpose of
inspecting the same, observing its use or otherwise protecting its interests
therein.
SECTION 8. MISCELLANEOUS
8.1 Amendments in Writing. None of the terms or provisions of
this Agreement may be waived, amended, supplemented or otherwise modified except
by a written instrument executed by each affected Granting Party and the
Administrative Agent, provided that any provision of this Agreement imposing
obligations on any Granting Party may be waived by the Administrative Agent in a
written instrument executed by the Administrative Agent.
8.2 Notices. All notices, requests and demands to or upon the
Administrative Agent or any Granting Party hereunder shall be effected in the
manner provided for in subsection 11.2 of the Senior Secured Credit Agreement;
provided that any such notice, request or demand to or upon any Guarantor shall
be addressed to such Guarantor at its notice address set forth on Schedule 1,
unless and until such Guarantor shall change such address by notice to the
Administrative Agent given in accordance with subsection 11.2 of the Senior
Secured Credit Agreement.
8.3 No Waiver by Course of Conduct; Cumulative Remedies.
Neither the Administrative Agent nor any other Secured Party shall by any act
(except by a written
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instrument pursuant to Section 8.1), delay, indulgence, omission or otherwise be
deemed to have waived any right or remedy hereunder or to have acquiesced in any
Default or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Administrative Agent or any other Secured Party,
any right, power or privilege hereunder shall operate as a waiver thereof. No
single or partial exercise of any right, power or privilege hereunder shall
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. A waiver by the Administrative Agent or any other
Secured Party of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy which the Administrative Agent or such
other Secured Party would otherwise have on any future occasion. The rights and
remedies herein provided are cumulative, may be exercised singly or concurrently
and are not exclusive of any other rights or remedies provided by law.
8.4 Enforcement Expenses; Indemnification. (a) Each Guarantor
agrees to pay or reimburse each Secured Party and the Administrative Agent for
all their respective reasonable costs and expenses incurred in collecting
against such Guarantor under the guarantee contained in Section 2 or otherwise
enforcing or preserving any rights under this Agreement against such Guarantor
and the other Loan Documents to which such Guarantor is a party, including,
without limitation, the reasonable fees and disbursements of one firm of counsel
to the Secured Parties and the Administrative Agent.
(b) Each Guarantor agrees to pay, and to save the
Administrative Agent and the Secured Parties harmless from, (x) any and all
liabilities with respect to, or resulting from any delay in paying, any and all
stamp, excise, sales or other similar taxes which may be payable or determined
to be payable with respect to any of the Security Collateral or in connection
with any of the transactions contemplated by this Agreement and (y) any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever with respect
to the execution, delivery, enforcement, performance and administration of this
Agreement (collectively, the "indemnified liabilities"), in each case to the
extent the Borrower would be required to do so pursuant to Section 11.5 of the
Senior Secured Credit Agreement, and in any event excluding any taxes or other
indemnified liabilities arising from gross negligence or willful misconduct of
the Administrative Agent or any Secured Party.
(c) The agreements in this Section 8.4 shall survive repayment
of the Obligations and all other amounts payable under the Senior Secured Credit
Agreement and the other Loan Documents.
8.5 Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the Granting Parties, the Administrative
Agent and the Secured Parties and their respective successors and assigns;
provided that no Granting Party may assign, transfer or delegate any of its
rights or obligations under this Agreement without the prior written consent of
the Administrative Agent.
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8.6 Set-Off. Each Guarantor hereby irrevocably authorizes the
Administrative Agent and each other Secured Party at any time and from time to
time without notice to such Guarantor, any other Guarantor or the Borrower, any
such notice being expressly waived by each Guarantor and by the Borrower, to the
extent permitted by applicable law, upon the occurrence and during the
continuance of an Event of Default under Section 9(a) of the Senior Secured
Credit Agreement and any amount remaining unpaid after it becomes due and
payable by such Guarantor hereunder, to set-off and appropriate and apply
against any such amount any and all deposits (general or special, time or
demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by the Administrative Agent or such other Secured Party to or for the
credit or the account of such Guarantor, or any part thereof in such amounts as
the Administrative Agent or such other Secured Party may elect. The
Administrative Agent and each other Secured Party shall notify such Guarantor
promptly of any such set-off and the application made by the Administrative
Agent or such other Secured Party of the proceeds thereof; provided that the
failure to give such notice shall not affect the validity of such set-off and
application. The rights of the Administrative Agent and each other Secured Party
under this Section 8.6 are in addition to other rights and remedies (including,
without limitation, other rights of set-off) which the Administrative Agent or
such other Secured Party may have.
8.7 Counterparts. This Agreement may be executed by one or
more of the parties to this Agreement on any number of separate counterparts,
and all of said counterparts taken together shall be deemed to constitute one
and the same instrument.
8.8 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
8.9 Section Headings. The Section headings used in this
Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation hereof.
8.10 Integration. This Agreement and the other Loan Documents
represent the entire agreement of the Granting Parties, the Administrative Agent
and the other Secured Parties with respect to the subject matter hereof, and
there are no promises, undertakings, representations or warranties by the
Granting Parties, the Administrative Agent or any other Secured Party relative
to subject matter hereof not expressly set forth or referred to herein or in the
other Loan Documents.
8.11 GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK.
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8.12 Submission To Jurisdiction; Waivers. Each party hereto
hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to
which it is a party, or for recognition and enforcement of any
judgement in respect thereof, to the non-exclusive general jurisdiction
of the courts of the State of New York, the courts of the United States
of America for the Southern District of New York, and appellate courts
from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court or
that such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to such party at its address referred to in Section 8.2 or at
such other address of which the Administrative Agent (in the case of
any other party hereto) or the Borrower (in the case of the
Administrative Agent) shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall
limit the right to xxx in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding
referred to in this Section any punitive damages.
8.13 Acknowledgements. Each Guarantor hereby acknowledges
that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents
to which it is a party;
(b) neither the Administrative Agent nor any other Secured
Party has any fiduciary relationship with or duty to any Guarantor
arising out of or in connection with this Agreement or any of the other
Loan Documents, and the relationship between the Guarantors, on the one
hand, and the Administrative Agent and the Secured Parties, on the
other hand, in connection herewith or therewith is solely that of
debtor and creditor; and
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(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions
contemplated hereby among the Secured Parties or among the Guarantors
and the Secured Parties.
8.14 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
8.15 Additional Granting Parties. Each new Domestic Subsidiary
of the Borrower that is required to become a party to this Agreement pursuant to
Section 8.15 of the Senior Secured Credit Agreement shall become a Granting
Party for all purposes of this Agreement upon execution and delivery by such
Subsidiary of an Assumption Agreement in the form of Annex 1 hereto.
8.16 Releases. (a) At such time as the Loans, the
Reimbursement Obligations and the other Obligations then due and owing shall
have been paid in full, the Commitments have been terminated and no Letters of
Credit shall be outstanding, all Security Collateral shall be released from the
Liens created hereby, and this Agreement and all obligations (other than those
expressly stated to survive such termination) of the Administrative Agent and
each Granting Party hereunder shall terminate, all without delivery of any
instrument or performance of any act by any party, and all rights to the
Security Collateral shall revert to the Granting Parties. At the request and
sole expense of any Granting Party following any such termination, the
Administrative Agent shall deliver to such Granting Party any Security
Collateral held by the Administrative Agent hereunder, and execute and deliver
to such Granting Party such documents (including without limitation UCC
termination statements) as such Granting Party shall reasonably request to
evidence such termination.
(b) In connection with the sale or other disposition of all of
the Capital Stock of any Guarantor or the sale or other disposition of Security
Collateral permitted under the Senior Secured Credit Agreement and the release
of such Guarantor from its Guarantee or the release of the Security Collateral
subject to such sale or other disposition, the Borrower shall deliver to the
Administrative Agent, a written request for release identifying such Guarantor
or the relevant Security Collateral and the terms of the sale or other
disposition in reasonable detail, including the price thereof and any expenses
in connection therewith,
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together with a certification by the Borrower stating that such transaction is
in compliance with the Senior Secured Credit Agreement and the other Loan
Documents. The Administrative Agent shall execute and deliver to the relevant
Granting Party (at the sole cost and expense of such Granting Party) all
releases or other documents (including without limitation UCC termination
statements) necessary or reasonably desirable for the release of the Liens
created hereby on such Security Collateral as such Granting Party may reasonably
request.
IN WITNESS WHEREOF, each of the undersigned has caused this
Guarantee and Collateral Agreement to be duly executed and delivered as of the
date first above written.
EV INTERNATIONAL, INC.
By: /s/ XXXXXXXXX X. VANDEN BEUKEL
--------------------------------
Xxxxxxxxx X. Vanden Beukel
Title: Vice Pres. and Secty
EVI AUDIO HOLDING, INC.
By: /s/ XXXXXXXXX X. VANDEN BEUKEL
------------------------------
Xxxxxxxxx X. Vanden Beukel
Title: Vice Pres. and Secty
Acknowledged and Agreed to as
of the date hereof by:
THE CHASE MANHATTAN BANK, as
Administrative Agent
By: /s/ XXXXXXXX XXXXXXX XX.
------------------------
Title: Vice President
Attorney-in-fact
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Schedule 1
NOTICE ADDRESSES OF GUARANTORS
EVI Audio Holdings, Inc.
c/o EV International, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention:
Telephone:
Telecopy:
with Copies to:
Greenwich Street Capital Partners, Inc.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
re: EVI Audio Holding, Inc.
Attention: Xxxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
and
Debevoise & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
46
Schedule 2
DESCRIPTION OF PLEDGED SECURITIES
PLEDGED STOCK:
Stock Certificate
Issuer Class of Stock No. No. of Shares
----------------- ---------------- -------------------- -------------------
47
Schedule 3
LOCATION OF JURISDICTION OF ORGANIZATION AND CHIEF EXECUTIVE OFFICE
OR SOLE PLACE OF BUSINESS
Granting Party Location
-------------- --------
48
Schedule 4
LOCATION OF INVENTORY AND EQUIPMENT
Granting Party Locations
-------------- ---------
49
Schedule 5
PATENTS AND PATENT LICENSES
TRADEMARKS AND TRADEMARK LICENSES
50
Schedule 6
EXISTING PRIOR LIENS
51
Schedule 7
ACCOUNTS
52
3
Schedule 8
CONTRACTS
53
Annex 1 to
Guarantee and Collateral Agreement
ASSUMPTION AGREEMENT, dated as of _________ __, 199_, made by
______________________________, a ______________ corporation (the "Additional
Granting Party"), in favor of THE CHASE MANHATTAN BANK, as administrative agent
(in such capacity, the "Administrative Agent") for the banks and other financial
institutions (the "Lenders") from time to time parties to the Senior Secured
Credit Agreement referred to below and the other Secured Parties (as defined
below). All capitalized terms not defined herein shall have the meaning ascribed
to them in such the Guarantee and Collateral Agreement referred to below, or if
not defined therein, in Senior Secured Credit Agreement.
W I T N E S S E T H :
WHEREAS, EV International, Inc., a Delaware corporation (the
"Borrower"), the Lenders and the Administrative Agent are parties to a Credit
Agreement, dated as of February 10, 1997 (as amended, supplemented or otherwise
modified from time to time, the "Senior Secured Credit Agreement");
WHEREAS, in connection with the Senior Secured Credit
Agreement, the Borrower and certain of its Affiliates and Subsidiaries are, or
are to become, parties to the Guarantee and Collateral Agreement, dated as of
February 10, 1997 (as amended, supplemented or otherwise modified from time to
time, the "Guarantee and Collateral Agreement") in favor of the Administrative
Agent, for the ratable benefit of the Secured Parties (as defined in the
Guarantee and Collateral Agreement);
WHEREAS, the Additional Grantor is a member of an affiliated
group of companies that includes the Borrower and each other Granting Party to
the Guarantee and Collateral Agreement; the proceeds of the extensions of credit
under the Senior Secured Credit Agreement will be used in part to enable the
Borrower to make valuable transfers to one or more of the other Granting Parties
(including the Additional Grantor) in connection with the operation of their
respective businesses; and the Borrower and the other Granting Parties
(including the Additional Grantor) are engaged in related businesses, and each
such Granting Party (including the Additional Grantor) will derive substantial
direct and indirect benefit from the making of the extensions of credit under
the Senior Secured Credit Agreement;
WHEREAS, the Senior Secured Credit Agreement requires the
Additional Granting Party to become a party to the Guarantee and Collateral
Agreement; and
WHEREAS, the Additional Granting Party has agreed to execute
and deliver this Assumption Agreement in order to become a party to the
Guarantee and Collateral Agreement;
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2
NOW, THEREFORE, IT IS AGREED:
1. Guarantee and Collateral Agreement. By executing and
delivering this Assumption Agreement, the Additional Granting Party, as provided
in Section 8.15 of the Guarantee and Collateral Agreement, hereby becomes a
party to the Guarantee and Collateral Agreement as a Granting Party thereunder
with the same force and effect as if originally named therein as a Guarantor [,
Grantor and Pledgor] [and Grantor] [and Pledgor]1 and, without limiting the
generality of the foregoing, hereby expressly assumes all obligations and
liabilities of a Guarantor [, Grantor and Pledgor] [and Grantor] [and Pledgor]2
thereunder. The information set forth in Annex 1-A hereto is hereby added to the
information set forth in Schedules __________ to the Guarantee and Collateral
Agreement, and such Schedules are hereby amended and modified to include such
information. The Additional Granting Party hereby represents and warrants that
each of the representations and warranties of such Additional Grantor, in its
capacities as a Guarantor [, Grantor and Pledgor] [and Grantor] [and Pledgor],3
contained in Section 4 of the Guarantee and Collateral Agreement is true and
correct in all material respects on and as the date hereof (after giving effect
to this Assumption Agreement) as if made on and as of such date.
2. GOVERNING LAW. THIS ASSUMPTION AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Assumption
Agreement to be duly executed and delivered as of the date first above written.
[ADDITIONAL GRANTING PARTY]
By:
---------------------------
Name:
Title:
--------
1. Indicate the capacities in which the Additional Grantor is becoming a
Granting Party.
2. Indicate the capacities in which the Additional Grantor is becoming a
Granting Party.
3. Indicate the capacities in which the Additional Grantor is becoming a
Granting Party.
55
Annex 1-A to
Assumption Agreement
