MASTER SECURITY AGREEMENT,
COLLATERAL ASSIGNMENT AND EQUITY PLEDGE
-- NBG RADIO NETWORK, INC. --
THIS MASTER SECURITY AGREEMENT, COLLATERAL ASSIGNMENT AND EQUITY PLEDGE
(as defined in Article 6 hereof, along with all other defined terms, this
"Security Agreement") is made and effective as of June 29, 2001, by EACH
"GRANTOR" THAT IS FROM TIME TO TIME LISTED ON SCHEDULE 1 HERETO OR OTHERWISE
ADDED AS A SIGNATORY HERETO (each, as more fully defined below, a "Grantor";
collectively, the "Grantors"), in favor of MCG FINANCE CORPORATION (including
any successor, participant, assignee, pledgee or transferee thereof,
"Administrative Agent"), as Administrative Agent for itself and the Lenders (as
defined in the Credit Agreement referred to below).
R E C I T A L S
WHEREAS, pursuant to that certain Credit Facility Agreement by and
among Borrowers, Lenders and Administrative Agent dated as of June 29, 2001 (as
may be amended from time to time, "Credit Agreement"), each Grantor is required
to have executed and delivered this Security Agreement encumbering all of each
Grantor's tangible and intangible personal property assets in favor of
Administrative Agent; and
WHEREAS, each Grantor has determined that it is in its best interest to
execute this Security Agreement inasmuch as each Grantor will derive substantial
direct and indirect benefits from the funding of the Advances by Lenders
pursuant to the Credit Agreement;
NOW, THEREFORE, for good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged) and intending to be legally bound
hereby, each Grantor and Administrative Agent hereby agree as follows:
ARTICLE 1: SECURITY INTEREST, COLLATERAL ASSIGNMENT AND PLEDGE
1.1. Grant of Security. Each Grantor (as of the effective date of
becoming a signatory hereto) hereby collaterally assigns and pledges to
Administrative Agent, and hereby grants to Administrative Agent a present,
absolute, unconditional and continuing security interest in, all of the
following property, assets and equity interests, whether or not such property
and assets are covered by Article 9 of the applicable UCC (collectively, and
including all Pledged Collateral, "Collateral"):
a. Fixtures and Improvements -- All of such Grantor's fixtures
and improvements to real property in all of its forms, including the following:
all buildings, structures, furnishings, and all heating, electrical, lighting,
power and air conditioning equipment, and all antennas, transmitters,
receivers and related equipment, and all other equipment that under applicable
law constitutes a fixture, and all parts thereof and all accessions, additions,
attachments, improvements, substitutions and replacements thereto and therefor
(any and all of the foregoing being the "Fixtures"); and
b. Equipment (and Computer Hardware) -- All of such Grantor's
equipment in all of its forms, including the following: all machinery, tools,
motor vehicles, furniture and furnishings, and all antennas, transmitters,
receivers and related equipment, all communications, telecommunications,
switches and related equipment, and all computer and other electronic data
processing hardware, integrated computer systems, central processing units,
memory units, display terminals, printers, features, computer elements, card
readers, tape drives, hard and soft disk drives, cables, electrical supply
hardware, generators, power equalizers, accessories and all peripheral devices
and other related computer hardware, and all documentation manuals and materials
with respect to such hardware, and all rights with respect to all of the
foregoing, including any and all licenses, options, warranties, service
contracts, program services, test rights, maintenance rights, support rights,
improvement rights, renewal rights and indemnifications, and any model
conversions of any of the foregoing, and all parts thereof and all accessions,
additions, parts (including replacement parts), attachments, improvements,
substitutions and replacements thereto and therefor (any and all of the
foregoing being the "Equipment"); and
c. Inventory -- All of such Grantor's inventory in all of its
forms, including the following: (1) all raw materials and work in process
therefor, finished goods thereof, and materials used or consumed in the
preparation, manufacture, creation or production thereof, and (2) all goods in
which any Grantor has an interest in mass or a joint or other interest or right
of any kind (including goods in which any Grantor has an interest or right as
consignee), and (3) all goods which are returned to or repossessed by any
Grantor, and in each instance all accessions thereto, products thereof and
documents therefor (any and all of the foregoing being the "Inventory"); and
d. Receivables, Accounts, Contracts, Money, Instruments,
Chattel Paper and Related Documents -- All of such Grantor's accounts,
receivables, cash collateral accounts, lock box accounts, other deposit
accounts, security deposits, advance payments, contracts, contract rights,
leases, licenses, insurance policies, chattel paper, documents, instruments
(whether or not negotiable), money, general intangibles and other obligations of
any kind, and whether or not arising out of or in connection with the sale or
lease of goods or the rendering of services (any and all of the foregoing being
the "Contract Rights"), and all rights of any Grantor in and to all agreements,
security agreements, guaranties, leases and other contracts securing or
otherwise relating to any such Contract Rights (any and all such security
agreements, guaranties, leases and other contracts being the "Related
Contracts"); and
e. Intellectual Property -- Without limiting any of the
foregoing, all of such Grantor's intellectual and information related property,
rights and assets, including the following (collectively, "Intellectual Property
Collateral"):
1. Computer Software and Data -- (a) All software
programs and data bases (including source code, object code and all related
applications and data files) owned, licensed or
leased by any Grantor, and (b) all firmware associated therewith or with any of
the Equipment, and (c) all documentation and materials (including all flow
charts, logic diagrams, algorithms, manuals, guides, instructions, indices,
abstracts and specifications) with respect to such software and firmware, and
(d) all rights with respect to all of the foregoing, including any and all
copyrights, trademarks, licenses, options, warranties, service contracts,
program services, test rights, maintenance rights, support rights, improvement
rights, renewal rights and indemnifications, and any substitutions,
replacements, additions or model conversions of any of the foregoing
(collectively, "Computer Software Collateral"), and
2. Copyrights -- All copyrights of such Grantor in
each work or authorship and derivative works thereof, whether published or
unpublished and whether or not the same also constitutes a trade secret, whether
statutory or common law, registered or unregistered, throughout the world,
including all of such Grantor's right, title and interest in and to all
copyrights registered in the United States Copyright Office or anywhere else in
the world, and all applications for registration thereof, whether pending or in
preparation, and all copyright licenses, and further including the right to xxx
for past, present and future infringements of any thereof, all rights
corresponding thereto throughout the world, and all goodwill associated
therewith, all extensions, continuations and renewals of any thereof, and all
proceeds of the foregoing, including licenses, fees, royalties, income,
payments, claims, damages and proceeds of suit (collectively, "Copyright
Collateral"), and
3. Patents -- All patents and like protections,
including all improvements, divisions, continuations, renewals, reissues,
extensions and continuations-in-part of the same, and all applications for
registration thereof, whether pending or in preparation, all patent licenses,
the right to xxx for past, present and future infringements of any thereof, all
rights corresponding thereto throughout the world, and all goodwill associated
therewith, all extensions, continuations and renewals of any thereof, and all
proceeds of the foregoing, including licenses, fees, royalties, income,
payments, claims, damages and proceeds of suit (collectively, "Patent
Collateral"), and
4. Trademarks -- (a) All trademarks, service marks,
trade names, corporate names, company names, business names, operating names,
domain names, fictitious business names, trade styles, certification marks,
collective marks, call signs, logos, other source of business identifiers,
prints, labels and goods on which any of the foregoing appear or have appeared,
designs (including product designs) and general intangibles of a like nature
except for the trademarks "NBG SOLUTIONS" - work xxxx stylized, serial number
7804029, "KiMon" - work xxxx stylized, serial number 78043339, and "KiNet" -
word xxxx stylized, serial number 78043329, and the domain names
XXXxxxxxxxxx.xxx and XXXxxxxxxxxx.xxx, and all other trademarks, service marks,
trade names, corporate names, company names, business names, operating names,
domain names, fictitious business names, trade styles, certification marks,
collective marks, call signs, logos, other source of business identifiers,
prints, labels and goods on which any of the foregoing appear or have appeared,
designs (including product designs) and general intangibles of a like nature
that is owned by a Grantor but used exclusively by NBG Solutions, Inc., (any and
all of the foregoing being the "Trademarks"), anywhere in the world, whether
registered or not and whether currently in use or not, all registrations and
recordings thereof and all applications to register the same, whether pending or
in preparation for filing, including registrations, recordings and applications
in the United States Patent and Trademark
Office (except for "intent to use" applications for trademark or service xxxx
applications filed pursuant to Section 1(b) of the Xxxxxx Act, unless and until
an Amendment to Allege Use or a Statement of Use under Section 1(c) or 1(d) of
said Act has been filed), or in any office or agency of the United States of
America or any State thereof or any foreign country, and (b) all Trademark
licenses, and (c) all reissues, extensions or renewals of any of the foregoing,
and (d) all of the goodwill of the business connected with the use of, and
symbolized by, the items described in the foregoing, and (e) all proceeds, fees,
royalties, income or payments of, and rights associated with, the foregoing,
including any claim by any Grantor against third parties for past, present or
future infringement or dilution of any Trademark, Trademark registration or
Trademark license, or for any injury to the goodwill associated with the use of
any such Trademark or for breach or enforcement of any Trademark license
(collectively, "Trademark Collateral"), and
5. Trade Secrets -- All common law and statutory
trade secrets and all other confidential or proprietary or useful information
and all know-how obtained by or used in or contemplated at any time for use in
any Grantor's business (any and all of the foregoing being the "Trade Secrets"),
whether or not such Trade Secret has been reduced to a writing or other tangible
form, including all documents and things embodying, incorporating or referring
in any way to such Trade Secrets, all Trade Secret licenses, and including the
right to xxx for and to enjoin and to collect damages for the actual or
threatened misappropriation of any Trade Secret and for the breach or
enforcement of any such Trade Secret license (collectively, "Trade Secret
Collateral"); and
f. Publication, Programming and Production-Related Property --
Without limiting any of the foregoing, all of such Grantor's right, title,
interest and benefits in, to and under (a) all books, writings, journals,
articles and publications, and (b) all customer, subscriber, prospect, inquiry,
circulation, marketing, advertising, publicity, promotional and programming
files, lists, records, documents, contracts and agreements, including all files,
lists and records of active, expired, prospective, trial and conditional
customers and subscribers, and all files, lists and records of current, former
and prospective advertisers, and all internally generated, purchased and rented
mailing lists (but only to the extent of any Grantor's rights therein), and all
promotional letters, catalogues, flyers, reply cards, sales materials,
promotional materials, sample mailing pieces, artwork, drawings, advertising
materials, space advertising and any similar materials, and (c) all publication
rights, programming rights, editorial rights, promotional rights, advertising
rights, licensing rights, distribution and redistribution rights, and printing
and reprinting rights (and any and all agreements, contracts, documents and
materials in any way governing or relating to any of the foregoing rights), and
(d) all editorial, publishing, programming, manufacturing, prepublication and
post-publication, royalty, sales, pricing, cost and promotional files, lists,
records and documents, and (e) all indices, abstracts, compilations, summaries,
glossaries and archives of or for any of the foregoing items, and (f) all other
information and property relating to, used or useful in connection with,
evidencing, embodying, incorporating or referring to, any of the foregoing
property identified in this clause or elsewhere in this Section 1.1 and
regardless of whether such property is embodied in a tangible or intangible
medium; and
g. Licenses and Authorizations -- Without limiting any of the
foregoing, all of such Grantor's right, title, interest and benefits in, to and
under all present and future Licenses,
Authorizations and other rights for the construction, development, operation and
ownership of its business and properties and all proceeds of such Licenses,
Authorizations and other rights, and all rights of such Grantor in and to all
agreements, security agreements, guaranties, leases and other contracts securing
or otherwise relating to any such Licenses, Authorizations and other rights; and
h. Other General Intangibles -- Without limiting any of the
foregoing, all of such Grantor's right, title, interest and benefits in, to and
under all other general intangibles, wherever arising, including the following:
(a) all corporate, partnership, limited liability company and joint venture
investments and other interests in and to any other entity (including all
ownership rights and interests in such Grantor's subsidiaries, whether or not
such rights and interests are certificated), and the proceeds and general
intangibles related thereto (including all dividends, distributions, capital
accounts and proceeds thereof), and (b) all leasehold interests (whether as
lessee or as lessor) and all related rights thereunder and proceeds thereof, and
(c) all tax refunds and other refunds or rights to receive payment from U.S.
federal, state, or local governments or from foreign governments, whether or not
arising out of or in connection with the sale or lease of goods or the rendering
of services, and (d) all settlements, judgments and other awards (whether or not
resulting from judicial or arbitration proceedings) and all tort and contract
claims and causes of action; and all rights of such Grantor in and to all
security agreements, guaranties, leases and other contracts securing or
otherwise relating to any such general intangibles; and
i. Securities and Investment Property -- Without limiting any
of the foregoing, all of such Grantor's right, title, interest and benefits in,
to and under all stocks, options, warrants, bonds, and other securities,
security entitlements, securities accounts, financial assets and other
investment property (including all such securities representing ownership in
such Grantor's subsidiaries), and the proceeds and general intangibles related
thereto (including all dividends and distributions); and
j. Other General Property -- All of such Grantor's other
property and rights of every kind and description and interests therein; and
k. Products and Proceeds -- All products, offspring, rents,
issues, profits, returns, refunds, income and proceeds of and from any and all
of the foregoing Collateral, including the following: all proceeds of the
Licenses and Authorizations, all proceeds that constitute property of the types
described in this Section 1.1, all proceeds deposited from time to time in any
lock boxes of any Grantor, and, to the extent not otherwise included, all
payments, unearned premiums and cash or surrender value under insurance policies
(whether or not Administrative Agent or any Lender is a loss payee or additional
insured thereof), and any indemnity, warranty or guaranty payable by reason of
loss or damage to or otherwise with respect to any of the foregoing Collateral;
in each instance (whether or not expressly specified above), wherever located,
and whether now existing, owned, leased or licensed or hereafter acquired ,
leased, licensed, arising, developed, generated, adopted or created for or by
any Grantor, and howsoever any Grantor's interest therein may arise or appear
(whether by ownership, security interest, claim or otherwise).
1.2. Security for Secured Obligations. This Security Agreement secures
the payment and performance in full of (a) all obligations (monetary or
otherwise) of each Borrower and each other Obligor now or hereafter existing
under the Credit Agreement or any other Loan Document as well as under any other
agreement with Administrative Agent or any Lender to extend credit to any
Obligor or to any Affiliate of any such Obligor (whether for principal,
interest, costs, fees, expenses, protective advances or otherwise), and (b) all
obligations (monetary or otherwise) of any Grantor now or hereafter existing
under this Security Agreement or any other Loan Document (all such obligations
under Clauses "(a)" and "(b)" being referred to collectively as the "Secured
Obligations").
1.3. Continuing Security Interest; Assignment; Termination. This
Security Agreement creates a continuing security interest in and collateral
assignment and pledge of the Collateral and will remain in full force and effect
until terminated as described below in this Section. This Security Agreement is
binding upon each Grantor and its successors, transferees and assignees, and
(together with the rights and remedies of Administrative Agent hereunder) inures
to the benefit of Administrative Agent and its successors, transferees,
participants and assignees. Without limiting the generality of the foregoing,
except to the extent restricted under the Credit Agreement, Administrative Agent
and each Lender may assign, syndicate, participate or otherwise transfer (in
whole or in part, and without any Grantor's consent) any Loan Document and any
indebtedness thereunder to any other Person, and such other Person or entity
will thereupon become vested with all the rights and benefits in respect thereof
granted to Administrative Agent or such Lender under any such Loan Document
(including this Security Agreement) or otherwise, subject, however, to any
contrary provisions in such assignment or transfer. The security interest,
collateral assignment and pledge granted herein will terminate (and all rights
to the Collateral will revert to Grantors) upon satisfaction of the following
conditions: (a) payment and performance in full of all Secured Obligations
(unconditionally and indefeasibly) and (b) the termination of the Credit
Agreement (and the Facilities thereunder). Upon any such termination,
Administrative Agent (at Grantors' request and sole expense) (a) will execute
and deliver to a Grantor (without any representation, warranty or recourse of
any kind whatsoever) such documents as such Grantor may reasonably request and
provide to Administrative Agent to evidence such termination, and (b) will
deliver to a Grantor or to another Person that Administrative Agent reasonably
believes may be entitled thereto (without any representation, warranty or
recourse of any kind whatsoever) all stock certificates and instruments
representing or evidencing Collateral being physically held by Administrative
Agent hereunder.
1.4. Security Interest Absolute. All rights of Administrative Agent and
Lenders and the security interests, collateral assignments and pledges granted,
assigned and pledged to Administrative Agent hereunder, and all obligations of
each Grantor hereunder, are absolute and unconditional, irrespective of the
occurrence of any one or more of the following:
a. Any lack of validity or enforceability of any Loan
Document; or
b. The failure of Administrative Agent or any Lender or
any holder of any Note:
1. To assert any claim or demand or to enforce any
right or remedy under the provisions of any Loan
Document or otherwise, or
2. To exercise any right or remedy against any
other Obligor of, or any collateral securing,
any obligations of any Borrower owing to any
Lender; or --
c. Any change in the time, manner or place of payment
of, or in any other term of, any Secured Obligation;
or
d. Any other extension, increase, refinancing,
restructuring, compromise or renewal of any Secured
Obligation; or
e. Any reduction, limitation, impairment or termination
of any Secured Obligation for any reason, including
any waiver, release, surrender, alteration or
compromise; or --
f. Any amendment to, rescission, waiver, or other
modification of, or any consent to departure from,
the terms of any Loan Document; or --
g. Any addition, exchange, release, surrender or
nonperfection of any collateral (including the
Collateral), or any amendment to or waiver or release
of or addition to or consent to departure from any
guaranty, for any Secured Obligation; or --
h. Any other circumstances which might otherwise
constitute a defense available to, or a legal or
equitable discharge of, any Grantor or its
obligations hereunder, including, without limitation,
any and all suretyship defenses.
Each Grantor hereby waives any right to or any claim of any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of any invalidity,
illegality, nongenuineness, irregularity, compromise, unenforceability of, or
any other event or occurrence affecting, any Secured Obligation.
1.5. Equity Pledge.
x. Xxxxx of Security Interest. Pursuant to Section 1.1,
without limiting the generality thereof, each Grantor pledges, hypothecates,
assigns, charges, mortgages, delivers, and transfers to Administrative Agent and
grants to Administrative Agent a present, absolute, unconditional and continuing
security interest in all of the following property (collectively, "Pledged
Equity Collateral"):
1. All Pledged Equity currently owned by such
Grantor; and
2. All Pledged Equity issued from time to time
hereafter to such Grantor; and
3. All other Pledged Equity Property (including,
all options and warrants for Pledged Equity)
owned by such Grantor, whether now or hereafter
delivered to Administrative Agent in connection
with this Security Agreement; and
4. All Dividends, Distributions, capital accounts,
and other payments and rights with respect to
any Pledged Equity Property received or
receivable by such Grantor; and
5. All proceeds of any of the foregoing; and
in each case, whether now existing or owned or hereafter acquired by such
Grantor and howsoever such Grantor's interest therein may arise or appear
(whether by ownership, security interest, claim or otherwise).
b. Delivery of Pledged Equity Property. To the extent that any
of the Collateral is evidenced by a certificate or instrument, then all such
certificates or instruments (a) must be delivered to and held by or on behalf of
Administrative Agent pursuant hereto, and (b) must be in suitable form for
transfer by delivery, and (c) must be accompanied by all necessary powers,
appointments and instruments of transfer or assignment, duly executed in blank.
c. Dividends and Distributions on Pledged Shares. Except as
otherwise provided in the Credit Agreement, all Dividends, Distributions,
non-Dividend cash payments, and proceeds thereof paid or payable to any Grantor
must be paid directly to Administrative Agent (properly endorsed if required
hereby or requested by Administrative Agent) as additional Collateral hereunder,
unless and until Administrative Agent has terminated this Security Agreement as
provided in Section 1.3. All Dividends, Distributions, cash payments, and
proceeds that at any time and from time to time may be delivered to any Grantor
but which such Grantor is then obligated to deliver to Administrative Agent,
until delivery to Administrative Agent, must be held by such Grantor (a) in
trust for Administrative Agent and (b) separate, segregated and apart from its
other property.
1.6. Collateral Assignment of Contracts.
x. Xxxxx of Security Interest. Pursuant to Section 1.1,
without limiting the generality thereof, each Grantor collaterally assigns to
Administrative Agent all of such Grantor's right, title and interest in and to
all of such Grantor's contracts, licenses, leases and other agreements and all
rights, interests, powers, privileges and other benefits thereunder (including
the rights to receive all proceeds and payments under each such contract,
license, lease and other agreement). This assignment of each contract, license,
lease and other agreement constitutes a fully perfected, absolute, unconditional
and present assignment, provided, however, that prior to the occurrence of an
Event of Default, such Grantor may exercise any rights and powers under and may
receive all payments and
enjoy all other benefits of each such contract, license, lease and other
agreement, subject to the terms and provisions of this Security Agreement and
the other Loan Documents.
b. Administrative Agent's Right to Cure. Administrative Agent
shall have the right (but not the obligation) to cure or remedy any breach or
default under any contract, license, lease or other agreement on the part of any
Grantor. The exercise by Administrative Agent of any of its rights hereunder
will not release any Grantor from any of its duties or obligations under any
such contracts, licenses, leases or other agreements included in the Collateral.
Neither Administrative Agent nor any Lender has any obligation or liability
under any such contracts, licenses, leases or other agreements included in the
Collateral by reason of this Security Agreement, nor is Administrative Agent or
any Lender obligated to perform any of the obligations or duties of any Grantor
thereunder or to take any action to collect or enforce any claim for payment
assigned hereunder.
1.7. Collateral Interest in Certain Intellectual Property.
Notwithstanding the language of Section 1.1, Administrative Agent's interest in
Copyrights, Patents and Trademarks (and any applications therefor) is as a
security interest and pledge and not as an absolute assignment.
1.8. Agreements Containing Non-Assignment Provisions. Notwithstanding
any terms of this Security Agreement to the contrary, the collateral assignment
of and security interest in a Grantor's interest in contracts, contract rights,
licenses (including Licenses), leases and other agreements with unrelated third
parties shall not apply to any contract, Contract Rights, license or License,
lease or other agreement with an unrelated third party if such Grantor has
entered into such contract, Contract Rights, license (including Licenses), lease
or other agreement prior to the date hereof, or, if after the date hereof, in
compliance with Section 5.16 of the Credit Agreement to the extent that it
expressly prohibits the granting of a security interest in or the assignment or
a collateral assignment of such Grantor's interest therein, and such prohibition
is legally enforceable under applicable law, provided, however, that the
foregoing shall not prohibit security interests or collateral assignments
created by this Security Agreement from extending to the proceeds arising form
such contracts, Contract Rights, licenses, Licenses, leases or other agreements
or to the monetary value of the goodwill and other general intangibles of such
Grantor relating thereto. Notwithstanding any terms of this Security Agreement
to the contrary, the collateral assignment of and security interest in a
Grantor's interest in fixtures and equipment shall not include fixtures and
equipment to the extent a collateral assignment of or grant of a security
interest in such fixtures or equipment would be prohibited by any contract
relating to such fixtures and equipment and such contract has been entered into
in accordance with the terms of the Loan Documents.
ARTICLE 2: REPRESENTATIONS AND WARRANTIES
Each Grantor hereby represents and warrants to Administrative Agent as
set forth in this Article.
2.1. Location of Collateral. Except as identified on Schedule 2.1, all
of the Equipment and Inventory of each Grantor is located at the address set
forth below the name of such Grantor on the signature page hereof. Except as
identified on Schedule 2.1, within the four months preceding the date
of this Security Agreement, none of the Equipment or Inventory has been located
at any place other than at such address. The principal places of business and
chief executive office of each Grantor and the offices where each Grantor keeps
its records concerning the Contract Rights and Related Contracts are located at
the address identified on Schedule 2.1.
2.2. Operating Names. Except as identified on Schedule 2.2, during the
preceding 12 years, no Grantor has been (a) operating under or known by any
legal or trade name different from the one set forth on the signature page
hereto or (b) the subject of any merger or other corporate reorganization.
2.3. Ownership; No Liens. Except as identified on Schedule 2.3,
Grantors are the sole and exclusive owners of or have the irrevocable, exclusive
and transferable right to possess and use the Collateral, and Grantors have full
authority to pledge, assign and grant a security interest in the Collateral. The
Collateral is free and clear of any Lien except (a) the security interest,
collateral assignment and pledge created by this Security Agreement and (b) as
otherwise permitted by the Credit Agreement. No effective financing statement or
other instrument similar in effect covering all or any part of the Collateral is
on file in any recording office, except (1) financing statements and
intellectual property security agreements filed in favor of Administrative Agent
relating to this Security Agreement and (2) such other financing statements and
instruments as identified on Schedule 2.3.
2.4. Government Contracts. Except as identified on Schedule 2.4, no
Grantor is a party to any Federal, state or local government contract (either
domestic or foreign).
2.5. Negotiable Documents, Instruments, Certificated Securities and
Chattel Paper. Contemporaneously with the execution hereof, each Grantor has
delivered to Administrative Agent possession of all originals of all negotiable
documents, certificated securities, instruments and chattel paper (other than
checks received in the ordinary course of business) currently owned or held by
such Grantor (duly endorsed in blank, if requested by Administrative Agent).
2.6. Intellectual Property Collateral. With respect to each item of
Intellectual Property Collateral:
a. Such Intellectual Property Collateral is subsisting, valid
and enforceable, and to each Grantor's knowledge (after due inquiry), such
Intellectual Property Collateral has not been adjudged invalid or unenforceable,
in whole or in part.
b. To each Grantor's knowledge (after due inquiry), no claim
has been made that the use of any Intellectual Property Collateral does or may
violate the asserted rights of any third party.
c. Each Grantor has performed all acts and has paid all
required fees and taxes to maintain each and every item of its Intellectual
Property Collateral in full force and effect throughout the world, as
applicable, except where such fees and taxes are being contested in good faith
with diligent prosecution.
d. Each Grantor owns directly, or is entitled to use by
license or otherwise, all Patents, Trademarks, Trade Secrets, Copyrights,
licenses, technology, know-how, processes and rights with respect to any of the
foregoing used in, necessary for or of importance to the conduct of such
Grantor's business. To the extent any such Intellectual Property Collateral was
developed or created for or on behalf of any Grantor as a "work for hire," then
such Grantor has obtained a waiver of any rights herein by the author or creator
hereof.
2.7. As to Pledged Shares. With respect to any Pledged Equity
constituting Collateral, all of such Pledged Equity is duly authorized and
validly issued, fully paid, and non-assessable. The Pledged Equity constitutes
all of the issued and outstanding shares (and other rights) of equity ownership
of each Pledged Equity Issuer owned by any Grantor.
2.8. Valid and Perfected Security Interest. This Security Agreement
creates a valid security interest in and collateral assignment and pledge of the
Collateral and proceeds thereof securing the payment of the Secured Obligations.
All filings and other actions necessary or desirable to perfect and protect such
security interest, collateral assignment and pledge have been duly taken or will
be duly taken as of the effective date hereof. Schedule 2.8 (a) lists each
filing (including filing locations and "debtor" names) that is necessary or
appropriate to perfect the security interests, collateral assignments and
pledges created hereby (including with respect to Intellectual Property
Collateral), and (b) identifies the items of Collateral that must be delivered
to or possessed by Administrative Agent to perfect Administrative Agent's
interest hereunder. Upon perfection (as described in this Section), such
security interest, collateral assignment and pledge will be of a first priority
ranking except as and to the extent noted in Section 2.3 (or on the
corresponding schedule thereto).
2.9. Authorization and Approval. Except as noted in Section 2.8 (or on
the corresponding schedule thereto), no authorization, approval or other action
by (and no notice to or filing with) any Official Body or other Person is
required either (a) for the grant by any Grantor of the security interest,
collateral assignment and pledge granted hereby, or (b) for the execution,
delivery and performance of this Security Agreement by any Grantor, or (c) for
the perfection by Administrative Agent of its rights and interests hereunder, or
(d) for the exercise by Administrative Agent of its rights and remedies
hereunder.
2.10. Compliance with Laws and Contracts. Each Grantor is (and after
execution and delivery of the Loan Documents to which such Grantor is a party,
such Grantor will be) in compliance in all material respects with the
requirements of all applicable laws, rules, regulations, policies, orders and
decrees of every Official Body and with all contractual restrictions, in either
instance the non-compliance with which individually or in the aggregate could
reasonably be expected to have or cause a Material Adverse Effect.
2.11. Validity of Obligations. This Security Agreement constitutes the
legal, valid and binding obligation of each Grantor and is enforceable against
each Grantor in accordance with the terms hereof.
2.12. Solvency; Fraudulent Transfers. No Grantor is "insolvent," as
such term is defined in Section 101(32) of the Bankruptcy Code (11 U.S.C. ss.
101(32)). No Grantor, by virtue of its obligations and actions in connection
with the Loan Documents, has engaged or is engaging in any transaction that
constitutes a fraudulent transfer or fraudulent conveyance under applicable
federal or state law (including under Section 548 of the Bankruptcy Code or
under the Uniform Fraudulent Transfer Act or the Uniform Fraudulent Conveyance
Act).
ARTICLE 3: COVENANTS
Each Grantor covenants and agrees that, so long as this Security
Agreement remains effective, each Grantor will comply with the covenants set
forth in this Article, unless Administrative Agent otherwise consents in
writing.
3.1. As to Equipment and Inventory.
a. Except as permitted by Section 5.14 of the Credit
Agreement, each Grantor will keep all the Equipment and Inventory (other than
Inventory and Equipment sold in the ordinary course of business or as otherwise
permitted by the Credit Agreement) at the places therefor specified in Section
2.1 or (upon prior written notice to Administrative Agent of at least 30
calendar days) at such other places in a jurisdiction where all of the
representations and warranties in Article 2 at that time will be true and
correct. Each Grantor will take all actions necessary to ensure the continued
perfection of Administrative Agent's interest in such Equipment and Inventory.
b. Each Grantor will maintain and preserve the Equipment in
the same condition, repair and working order as when new (ordinary wear and tear
excepted) and in all material respects in accordance with all manufacturer's
manuals. Each Grantor will forthwith (or, in the case of any loss or damage to
any Equipment, as quickly as practicable after the occurrence thereof) make or
cause to be made all repairs, replacements and other improvements in connection
with the Equipment that are necessary or desirable to maintain the Equipment in
accordance with the standard set forth in this Section. Each Grantor will
promptly furnish to Administrative Agent a statement respecting any loss or
damage to any of the Equipment.
c. Each Grantor will pay promptly before delinquent all
property and other taxes, assessments and governmental charges or levies imposed
upon, and all claims (whether for labor, materials or supplies) against, the
Equipment and Inventory, except to the extent the validity thereof is being
contested in good faith by appropriate proceedings diligently prosecuted and for
which adequate reserves in accordance with GAAP have been set aside.
3.2. As to Contracts and Related Rights.
a. Each Grantor will keep its principal place of business and
chief executive office and the office where it keeps its records concerning the
Contract Rights and Related Contracts, and all originals of all chattel paper
which evidence Contract Rights, located at the places therefor specified in
Section 2.1 or (upon prior written notice to Administrative Agent of at least 30
calendar days) at such
other places in a jurisdiction where all of the representations and warranties
in Article 2 at that time will be true and correct. Each Grantor will take all
actions necessary to ensure the continued perfection of Administrative Agent's
interest in the Contract Rights and Related Contracts. No Grantor will change
its name except upon prior written notice to Administrative Agent of at least 30
calendar days. Each Grantor will hold and preserve such records and chattel
paper concerning the Contract Rights and Related Contracts and will permit
representatives of Administrative Agent or any Lender at any time during normal
business hours to inspect and make abstracts from such records and chattel
paper.
b. Each Grantor will remain liable under the contracts,
licenses, leases and other agreements included in the Collateral to the extent
set forth therein. Without limiting the foregoing, unless a Grantor otherwise
receives Administrative Agent's prior written consent (which consent will not be
unreasonably withheld while no Default is occurring), then such Grantor (a) will
faithfully abide by, perform and discharge each and every material obligation,
covenant and agreement under each Material Contract (as such term is defined in
the Credit Agreement) to be performed by such Grantor, and (b) will not
materially amend, modify or otherwise alter the terms of any Material Contract
(including the term or duration thereof or the amount of or methodology for
calculating the compensation due thereunder), and (c) will not assign its rights
under any Material Contract, and (d) will not accept (and will not take any
action to cause) a surrender, termination, revocation or cancellation of any
Material Contract unless replaced by a substantially similar contractual
relationship reasonably acceptable to Administrative Agent, and (e) will enforce
the performance of each and every material obligation, covenant and condition of
each Material Contract to be performed by the other parties thereto, and (f)
will appear in and defend any action or proceeding arising under or in any
manner connected with any Material Contract.
c. Each Grantor will give prompt written notice to
Administrative Agent of the occurrence of any default, breach or other material
event, condition or circumstance relating to any of such Grantor's Material
Contracts (together, if applicable, with a true and complete copy of any related
written notice that such Grantor may have given to or received from any other
party thereto).
3.3. As to Pledged Equity Collateral.
x. Xxxxxx and Appointments. Each Grantor agrees that all
Pledged Equity (and all other equity ownership interests constituting Pledged
Equity Collateral) delivered by any Grantor pursuant to this Security Agreement
will be accompanied by duly executed undated blank powers, appointments or other
equivalent instruments of transfer acceptable to Administrative Agent. From time
to time at Administrative Agent's request, each Grantor will promptly deliver to
Administrative Agent such powers, appointments, instruments and similar
documents (satisfactory in form and substance to Administrative Agent) with
respect to the Collateral. From time to time at Administrative Agent's request
after the occurrence of any Event of Default, each Grantor will promptly
transfer any Pledged Equity or other shares of capital stock or ownership
interests constituting Collateral into the name of any nominee designated by
Administrative Agent.
b. Continuous Pledge; Protect Pledged Equity Collateral. At
all times, each Grantor will keep pledged to Administrative Agent pursuant
hereto all Pledged Equity, all other Pledged Collateral, all Dividends and
Distributions with respect thereto (subject, however, to Section 1.5.c), and all
other securities, instruments, proceeds, capital accounts, and rights from time
to time received by or distributable to any Grantor in respect of any Pledged
Equity Collateral. Each Grantor will warrant and defend the right and title
herein granted to Administrative Agent in and to the Pledged Equity Collateral
(and all right, title, and interest represented by the Pledged Equity
Collateral) against the claims and demands of all persons whomsoever.
c. Delivery of Dividends, Distributions and Other Collateral.
Promptly upon receipt and without any request by Administrative Agent, each
Grantor agrees to deliver to Administrative Agent (properly endorsed if required
hereby or requested by Administrative Agent) all Distributions, all Dividends
(subject, however, to Section 1.5.c), all other non-Dividend cash payments, and
all proceeds thereof, all of which will be held by Administrative Agent as
additional Pledged Equity Collateral. All Dividends, Distributions, cash
payments, and proceeds that at any time and from time to time may be delivered
to any Grantor but which such Grantor is then obligated to deliver to
Administrative Agent, until delivery to Administrative Agent, must be held by
such Grantor (a) in trust for Administrative Agent and (b) separate, segregated
and apart from its other property.
d. Voting Rights.
1. Unless and until an Event of Default has occurred
and is continuing, each Grantor will have the exclusive right to exercise all
voting rights with respect to its Pledged Equity. Upon written request from a
Grantor (and at such Grantor's sole expense), Administrative Agent will promptly
execute and deliver such proxies and other documents, if any, as reasonably
requested in writing by such Grantor (together with a reasonably acceptable form
thereof) that are necessary to allow such Grantor to exercise voting power with
respect to any such Pledged Equity owned by such Grantor constituting Pledged
Equity Collateral; provided, however, that no vote may be cast or other action
taken by any Grantor (including, the giving of any consent, waiver, or
ratification) that could impair any Pledged Equity Collateral or would otherwise
be inconsistent with or violate any provision of any Loan Document (including
this Security Agreement).
2. After any Event of Default has occurred and is
continuing and Administrative Agent has notified any Grantor of Administrative
Agent's intention to exercise its voting power, unless otherwise then expressly
impermissible under applicable law, Administrative Agent may exercise (to the
exclusion of each Grantor) the voting power and all other incidental rights of
ownership with respect to any Pledged Equity or other ownership interests
constituting Pledged Equity Collateral. Each Grantor hereby grants
Administrative Agent an irrevocable proxy, exercisable under such circumstances,
to vote the Pledged Equity and such other Pledged Equity Collateral. Each
Grantor hereby covenants to promptly deliver to Administrative Agent such
additional proxies, appointments and other documents as may be necessary to
allow Administrative Agent to exercise such voting power and other incidental
ownership rights.
3.4. As to Intellectual Property Collateral.
a. No Grantor (1) will fail to maintain (in a manner
consistent with its historical practices) the quality of products and services
offered under all of the Trademark Collateral, or (2) will fail to employ with
all of the Trademark Collateral (whether or not registered with any Official
Body) an appropriate notice of such trademark, or (3) will fail to employ with
all of the material Copyright Collateral an appropriate notice of such
copyright, or (4) will fail to employ with any Patent Collateral registered with
the U.S. Patent and Trademark Office, or in a foreign country, an appropriate
notice of such registration.
b. No Grantor will do or permit any act (or knowingly omit to
do any act) whereby any of the material Intellectual Property Collateral may
lapse or become abandoned, forfeited, invalid, dedicated to the public or
unenforceable (except upon expiration of the end of an unrenewable term of a
registration thereof) without the prior written consent of Administrative Agent
(which consent will not be unreasonably withheld while no Default is occurring).
c. Each Grantor will promptly notify Administrative Agent if
such Grantor believes (or has reason to believe) that (1) any application or
registration relating to any material item of the Intellectual Property
Collateral may become abandoned, dedicated to the public, placed in the public
domain, invalid or unenforceable, or (2) there has been or will be an adverse
determination or development (including the institution of, or any determination
or development in, any proceeding in the United States Patent and Trademark
Office, the United States Copyright Office or any other Official Body) regarding
such Grantor's ownership of any material item of the Intellectual Property
Collateral, its right to register the same, or its right to keep, maintain and
enforce the same.
d. If any Grantor files an application for the registration of
any Intellectual Property Collateral with the United States Patent and Trademark
Office, the United States Copyright Office or any other Official Body, then such
Grantor must notify Administrative Agent thereof within 30 calendar days
thereafter, and upon request of Administrative Agent, must promptly execute and
deliver any and all agreements, instruments, documents and papers that
Administrative Agent may request to evidence Administrative Agent's security
interest in such Intellectual Property Collateral.
e. Each Grantor will perform all acts and will pay all
required fees and taxes (including in any proceeding before the United States
Patent and Trademark Office, the United States Copyright Office or any other
Official Body) to maintain each and every item of Intellectual Property
Collateral (i) that has been registered with the United States Government or any
other Official Body, or (ii) the failure of which to so maintain would be
reasonably likely to have a Material Adverse Effect, in full force and effect
throughout the world and to pursue any application filed with respect to the
Intellectual Property Collateral, including the filing of applications for
renewal, affidavits of use, affidavits of incontestability and opposition, and
interference and cancellation proceedings.
f. Upon any Grantor's acquiring any material Intellectual
Property Collateral the acquisition of which must be recorded in order to
perfect such Grantor's interest therein, then such Grantor will promptly record
its interest therein and will notify Administrative Agent thereof within 30
calendar days thereafter.
g. Each Grantor (1) will protect, defend and maintain the
validity and enforceability of its material Intellectual Property Collateral,
and (2) will use its best efforts to detect infringements of the Intellectual
Property Collateral and promptly notify Administrative Agent in writing of
material infringements detected.
h. Each Grantor, on a continuing basis, will register such
Grantor's Trademarks, pursue patent protection for such Grantor's inventions,
and register the most recent versions of any of such Grantor's material
Copyrights.
i. No Grantor will enter into any agreement that would
materially impair or conflict with such Grantor's obligations hereunder with
respect to its material Intellectual Property Collateral. No Grantor will permit
the inclusion in any material contract to which it becomes a party any
provisions that could in any way prevent the creation of a security interest in
such Grantor's rights and interest in any property included within the
definition of the Intellectual Property Collateral acquired or licensed under
such contracts. No Grantor will arrange for the creation or development of any
Intellectual Property Collateral as a "work for hire" without concurrently
obtaining a waiver of all rights therein by the author or creator thereof.
j. Each Grantor will promptly notify Administrative Agent in
writing upon obtaining knowledge of any event that materially adversely affects
(1) the value of any material Intellectual Property Collateral, or (2) the
ability of such Grantor to dispose of any material Intellectual Property
Collateral, or (3) the rights and remedies of Administrative Agent in relation
thereto, including the levy of any legal process against any of the Intellectual
Property Collateral.
k. Each Grantor, on a continuing basis, will make, execute,
acknowledge and deliver, and will file and record in the proper filing and
recording places in the United States, all such instruments, collateral
agreements and filings (including all appropriate financing and continuation
statements) with the United States Patent and Trademarks Office and the Register
of Copyrights, and will take all such action as Administrative Agent may
reasonably deem to be necessary or advisable to perfect or protect
Administrative Agent's security interest in all Intellectual Property Collateral
and otherwise to carry out the intent and purpose of this Security Agreement, or
for assuring and confirming to Administrative Agent the grant or perfection of a
security interest in all Intellectual Property Collateral.
3.5. As to Customer and Material Business Records and Computer
Software.
a. Upon Administrative Agent's request, each Grantor (at its
cost and expense) will maintain at a separate location a duplicate current copy
of (1) all lists, files and records of active and prospective customers and
subscribers, and (2) all material computer software and data bases (including
all material application and operating system software and all material data
files and operating manuals), and (3) all other material business files, records
and software that Administrative Agent may reasonably request in writing from
time to time. Unless Administrative Agent otherwise consents, such records,
materials and information must be kept (at Grantors' election) either with
Administrative Agent or with an unrelated business that is engaged in the
business of storing such
items and that is reasonably acceptable to Administrative Agent. At
Administrative Agent's request, the location at which such records, materials
and information is stored must be located within the Washington, D.C.
metropolitan area. For purposes of this Clause, such records, materials and
information will be considered "current" if they were accurate and complete
within the immediately preceding 30 calendar days.
b. If any Grantor elects to keep such records, materials and
information with an unrelated business, then (upon Administrative Agent's
request) such Grantor will notify such business at which such records, materials
and information are maintained (1) that Administrative Agent, each Lender and
their representatives are authorized from time to time to inspect, examine,
audit and make copies and abstracts of such records, materials and information
during normal business hours, and (2) that, upon receipt of written notice from
Administrative Agent that an Event of Default has occurred under the Loan
Documents, such business is to release and deliver such records, materials and
information to Administrative Agent in such manner and at such place as
Administrative Agent may direct (in its sole and absolute discretion), and (3)
that such business is not to release or return such records, materials or
information to any Grantor without Administrative Agent's prior written consent
unless (a) such Grantor has delivered a more current version thereof to such
business or (b) this Security Agreement has been terminated in accordance with
Section 1.3.
c. Each Grantor will also otherwise utilize standard industry
precautions to safeguard the utility, value and confidentiality of all such
records, materials and information covered by this Section.
3.6. As to Certain Investment Property (including Margin Stock).
Without obtaining Administrative Agent's prior written consent (which consent
will not be unreasonably withheld while no Default is occurring), no Grantor
will establish or maintain any "securities account" or "financial asset" with
any "securities intermediary" (as such terms are defined in Article 8 of the
UCC), unless a control agreement acceptable in form and substance to
Administrative Agent is first executed by such "securities intermediary"
securing Administrative Agent's first priority interest and rights in and to all
"financial assets" and "security entitlements" associated with such "securities
account". Without obtaining Administrative Agent's prior written consent (which
consent will not be unreasonably withheld while no Default is occurring), no
Grantor will purchase or carry any "Margin Stock" within the meaning of
Regulations T, U or X of the Board of Governors of the Federal Reserve System.
3.7. Insurance. Each Grantor will maintain insurance coverages to the
same extent and subject to the same requirements and conditions as required for
Borrowers under the Credit Agreement. Payments and proceeds in respect of
insurance coverage are to be delivered to Administrative Agent and may be held
by Administrative Agent (at its discretion) as additional Collateral for, and at
any time during the occurrence of an Event of Default may be applied by
Administrative Agent in whole or in part against, all or any part of the Secured
Obligations in such order as Administrative Agent elects.
3.8. Transfers and Other Liens.
a. No Grantor will sell, transfer, assign, lease, license or
otherwise dispose of any of the Collateral, except (1) Inventory sold, leased or
licensed in the ordinary course of business to unrelated third parties for value
received, and (2) Equipment that has become obsolete or worn out, and (3)
Equipment leased or licensed in the ordinary course of business to unrelated
third parties for value received, and (4) Intellectual Property Collateral
licensed to unrelated third parties for value received and subject to at least
commercially reasonable terms and conditions from the perspective of such
Grantor, and (5) as otherwise permitted by the Credit Agreement.
b. Each Grantor will maintain the security interest,
collateral assignment and pledge created hereby as a first priority interest
(except as otherwise permitted by the Credit Agreement), and no Grantor will
create or suffer to exist any Lien upon or with respect to any of the Collateral
to secure any indebtedness or obligations of any Person, (except as otherwise
permitted by the Credit Agreement).
3.9. Further Assurances. Each Grantor (from time to time at its own
expense) will promptly execute and deliver all further instruments and
documents, and will take all further action, that may be necessary or desirable
(or that Administrative Agent may reasonably request) in order to perfect,
preserve and protect any security interest, collateral assignment or pledge
granted or purported to be granted hereby or to enable Administrative Agent to
exercise and enforce its rights and remedies hereunder with respect to any
Collateral. Without limiting the generality of the foregoing, each Grantor:
a. Will xxxx conspicuously each chattel paper included in the
Contract Rights and, at the request of Administrative Agent, each of its records
pertaining to the Collateral with a legend (in form and substance reasonably
satisfactory to Administrative Agent) indicating that such chattel paper is
subject to the security interest, collateral assignment and pledge granted
hereby; and
b. If any Contract Rights shall be evidenced by a promissory
note or other instrument, negotiable document or chattel paper, then will
deliver and pledge to Administrative Agent hereunder such promissory note,
instrument, negotiable document or chattel paper duly endorsed and accompanied
by duly executed instruments of transfer or assignment, all in form and
substance reasonably satisfactory to Administrative Agent; and
c. Will execute and file such financing or continuation
statements, or amendments thereto, and such other instruments or notices as may
be necessary (or as Administrative Agent may reasonably request) in order to
perfect and preserve the security interests, collateral assignments, pledges and
other rights granted or purported to be granted to Administrative Agent hereby;
and
d. Will furnish to Administrative Agent (from time to time at
Administrative Agent's request) statements and schedules further identifying and
describing the Collateral and such other reports in connection with the
Collateral as Administrative Agent may reasonably request, all in reasonable
detail.
With respect to the foregoing and the grant of the security interest, collateral
assignment and pledge hereunder, each Grantor hereby authorizes Administrative
Agent to file one or more financing or continuation statements, and amendments
thereto, relative to all or any part of the Collateral without the signature of
such Grantor where permitted by law. A carbon, photographic or other
reproduction of this Security Agreement or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law.
ARTICLE 4: POWER OF ATTORNEY IN EVENT OF DEFAULT
4.1. Administrative Agent Appointed Attorney-in-Fact. Each Grantor
hereby irrevocably appoints Administrative Agent as such Grantor's
attorney-in-fact, with full authority in the name, place and stead of such
Grantor or otherwise, from time to time in Administrative Agent's reasonable
discretion upon the occurrence and during the continuance of an Event of
Default, to take any action and to execute any instrument which Administrative
Agent may deem reasonably necessary or advisable to accomplish the purposes of
this Security Agreement. This authority includes the following:
a. To ask, demand, collect, xxx for, recover,
compromise, restructure, receive and give acquittance
and receipts for moneys due and to become due under
or in respect of any of the Collateral; and/or
b. To notify the parties obligated on any of the
Collateral to make payment to Administrative Agent of
any amount due or to become due in connection
therewith; and/or
c. To receive, endorse, and collect any drafts, checks
or other instruments, documents and chattel paper in
connection with Clause "a" of this Section; and/or -
d. To file any claims or take any action or institute
any proceedings which Administrative Agent may deem
reasonably necessary or desirable for the collection
of any of the Collateral or otherwise to enforce the
rights of Administrative Agent, any Lender or any
Grantor with respect to any of the Collateral; and/or
e. To execute (in the name, place and stead of any
Grantor) endorsements, assignments, powers and other
instruments of conveyance or transfer with respect to
all or any of the Collateral; and/or
f. To perform any and all of the affirmative obligations
and covenants of such Grantor hereunder (with notice
thereof to be provided to such Grantor by
Administrative Agent within a reasonable time
thereafter).
Each Grantor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section is irrevocable and coupled with an interest,
but that it will terminate upon the termination of this Security Agreement
pursuant to Section 1.3.
4.2. Administrative Agent May Perform. From time to time,
Administrative Agent (at its option) may perform (or may cause the performance
of) any act which any Grantor agrees hereunder to perform and which such Grantor
fails to perform after being requested in writing so to perform (it being
understood that no such request need be given during the continuance of an Event
of Default), and Administrative Agent from time to time may also take any other
action which Administrative Agent reasonably deems necessary for the
maintenance, preservation or protection of any of the Collateral or of its
security interest therein or collateral assignments or pledges thereof. The
costs and expenses of Administrative Agent incurred in connection with any such
performance will be payable by Grantors (jointly and severally) pursuant to
Section 5.3 hereof.
4.3. Administrative Agent Has No Duty. The rights and powers conferred
upon Administrative Agent hereunder are solely to protect Administrative Agent's
and each Lender's interest in the Collateral and do not impose any duty on
Administrative Agent to exercise any such rights or powers. Except for
reasonable care of any Collateral in Administrative Agent's possession and the
accounting for moneys actually received by it hereunder, Administrative Agent
has no duty as to any Collateral or as to the taking of any necessary steps to
preserve rights against prior parties or any other rights pertaining to any
Collateral.
4.4. Reasonable Care. Administrative Agent is required to exercise
reasonable care in the custody and preservation of any of the Collateral in its
possession; provided, however, Administrative Agent will be deemed to have
exercised such reasonable care in the custody and preservation of any of the
Collateral if Administrative Agent takes such action for that purpose as any
Grantor reasonably requests in writing at times other than after the occurrence
or during the continuance of a Default. Notwithstanding the foregoing, any
failure or refusal by Administrative Agent at any time to comply with any such
request by any Grantor will not in itself be deemed a failure to exercise
reasonable care.
ARTICLE 5: DEFAULTS AND REMEDIES
5.1. Events of Default. The occurrence of any "Event of Default" under
and as defined in the Credit Agreement will constitute an independent Event of
Default ("Event of Default") hereunder.
5.2. Certain Remedies. If any Event of Default occurs and is
continuing:
a. In addition to other rights and remedies provided for
herein (including under Article 4) or otherwise available to Administrative
Agent or any Lender (including under the other Loan Documents and/or applicable
law), Administrative Agent may also exercise in respect of the Collateral all
the rights and remedies of a secured party upon default under the UCC (whether
or not the UCC applies to the affected Collateral). Upon the occurrence of any
Event of Default, Administrative Agent will have the immediate right to enforce
and realize upon any and all collateral security granted under the Loan
Documents (including the Collateral hereunder) in any manner or
order that Administrative Agent deems expedient without regard to any equitable
principles of marshalling or otherwise. All rights and remedies available to
Administrative Agent or any Lender are to be considered cumulative in nature.
b. Without notice except as expressly specified herein or
required by applicable law, Administrative Agent may also sell the Collateral or
any part thereof in one or more parcels at public or private sale, at any of
Administrative Agent's offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as Administrative Agent may deem
commercially reasonable. To the extent notice of sale is required by law, each
Grantor agrees that prior notice to a Grantor of at least fifteen (15) calendar
days indicating the time and place of any public sale or the time after which
any private sale is to be made shall constitute reasonable notification.
Administrative Agent shall not be obligated to make any sale of Collateral
regardless of notice of sale having been given. Administrative Agent may adjourn
any public or private sale from time to time by announcement at the time and
place fixed therefor, and such sale (without further notice) may be made at the
time and place to which it was so adjourned.
c. Administrative Agent may require Grantors to, and each
Grantor hereby agrees (at its expense) that it will, forthwith assemble all or
part of the Collateral as directed by Administrative Agent and make it available
to Administrative Agent at a place designated by Administrative Agent that is
reasonably convenient to both Administrative Agent and Grantors.
d. Unless Administrative Agent otherwise consents, each
Grantor will remit to Administrative Agent all cash proceeds received in respect
of any sale of, or collection from, or other realization upon all or any part of
the Collateral. All cash proceeds received by Administrative Agent from any
Grantor or otherwise in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral (in the discretion of
Administrative Agent) may be held by Administrative Agent as additional
Collateral for the Secured Obligations, and/or then or at any time thereafter
may be applied in whole or in part by Administrative Agent against all or any
part of the Secured Obligations in an order consistent with the designated
application of payments provided for in Section 1.5 of the Credit Agreement. Any
surplus of such cash or cash proceeds held by Administrative Agent and remaining
after payment in full of all the Secured Obligations will be paid over to a
Grantor or to whomsoever Administrative Agent reasonably believes may be
lawfully entitled to receive such surplus.
e. To the extent any of the Collateral represents an interest
in a partnership, a limited liability company or other unincorporated
enterprise, in addition to any other rights and remedies available to
Administrative Agent or any Lender under the Loan Documents or applicable law,
Administrative Agent (at its option but with notice to the relevant Grantor) may
also exercise all rights and privileges of the holder of such interest under the
agreements governing such Collateral and the Organic Documents for the related
organization or may instruct such Grantor how to exercise such rights and
privileges (with which instructions each Grantor hereby agrees to comply). Each
Grantor, in addition, covenants and agrees (at Administrative Agent's request)
to amend (and to use its best efforts to cause others to amend) any of the
Organic Documents for such organization in order to authorize Administrative
Agent to so exercise any such rights and privileges associated with such
Collateral (including voting rights and the rights to participate in management
decisions). The rights of Administrative Agent under this Subsection may be
transferred to and exercised by any subsequent acquiror or transferee of the
Collateral pursuant to any sale of or foreclosure on such Collateral. Each
Grantor hereby agrees that the rights of Administrative Agent and each Lender
(or any subsequent acquiror or transferee of the Collateral) under this
Subsection may be enforced by specific performance or otherwise.
5.3. Special Securities-Related Remedies.
a. Additional Rights. If, during the continuance of an Event
of Default, Administrative Agent determines to exercise its right to sell all or
any portion of the Pledged Equity Collateral pursuant to Section 5.2, upon
Administrative Agent's request, then each Grantor (at its own expense):
1. Will execute and deliver, and will use best
efforts to cause each issuer of the Pledged
Equity Collateral contemplated to be sold
(and the directors and officers thereof) to
execute and deliver, all such instruments
and documents, and will do or use best
efforts to cause to be done all such other
acts and things as may be necessary or, in
Administrative Agent's opinion, advisable
(1) to register such Pledged Equity
Collateral under the provisions of the
Securities Act or to comply with the
provisions thereof to obtain or be eligible
for exemption from such registration, and
(2) to cause the registration statement
relating thereto to become effective and to
remain effective for such period as
prospectuses are required by law to be
furnished, and (3) to make all amendments
and supplements thereto and to the related
prospectus which, in Administrative Agent's
opinion, 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; and
2. Will use its best efforts to qualify or
register (or obtain an applicable exemption
from such qualification or registration
requirements) the Pledged Equity Collateral
under the state securities or "Blue Sky"
laws and to obtain all necessary
governmental approvals for the sale of the
Pledged Equity Collateral, as requested by
Administrative Agent; and
3. Will use best efforts to cause each such
issuer to make available to its security
holders, as soon as practicable, an earnings
statement that will satisfy the provisions
of Section 11(a) of the Securities Act; and
4. Will do or use best efforts to cause to be
done all such other acts and things as may
be reasonably necessary, or in
Administrative Agent's opinion, advisable to
make such sale of the Pledged Equity
Collateral or any part thereof valid and
binding and in compliance with applicable
law.
In furtherance of the foregoing (and not in limitation of any other obligations
under the Loan Documents), each Grantor covenants that it will fully cooperate
with each other Grantor and Administrative Agent, and will comply with all
requests of Administrative Agent, in order to permit Administrative Agent to
fully and timely exercise the remedies under this Section.
b. Compliance with Restrictions. Each Grantor agrees that, in
any sale of any of the Pledged Equity Collateral, Administrative Agent is
authorized to comply with any limitation or restriction in connection with the
type of such sale pursued as Administrative Agent may be advised by counsel is
necessary or desirable in order to avoid any violation of applicable law
(including compliance with such procedures as may restrict the number of
prospective bidders and purchasers, require that such prospective bidders and
purchasers have certain qualifications, and restrict such prospective bidders
and purchasers to persons who will represent and agree that they are purchasing
for their own account for investment and not with a view to the distribution or
resale of such Collateral), or in order to obtain any required approval of the
sale or of the purchaser by any Official Body. Each Grantor further agrees that
such compliance will not result in such sale being considered or deemed not to
have been made in a commercially reasonable manner, nor will Administrative
Agent or any Lender be liable or accountable to any Grantor for any discount
allowed by reason of the fact that such Collateral is sold at foreclosure or
otherwise in compliance with any such limitation or restriction or by reason of
the fact that such Pledge Equity Collateral may represent a minority interest in
any Grantor.
5.4. Special IP-Related Remedies (License of Intellectual Property
Collateral). Each Grantor hereby grants Administrative Agent a royalty-free,
non-exclusive, worldwide, irrevocable license (the "Remedies License") to make,
use and sell from time to time after the occurrence and during the continuance
of any Event of Default that is not waived by Administrative Agent and delivery
of notice thereof by Administrative Agent (unless such Event of Default is under
Section 7.1.10 of the Credit Agreement, in which case no such notification shall
be required) all present and future Intellectual Property Collateral of such
Grantor (including the right to sub-license such Intellectual Property
Collateral) in connection with the maintenance, preservation, preparation, sale,
disposition, collection, foreclosure, or other realization of, upon, or with
respect to the Collateral or payment of the Secured Obligations in accordance
with the Loan Documents. The Remedies License shall remain in full force and
effect until this Security Agreement is terminated in accordance with Section
1.3 (but any sub-license or transfer of the Remedies License prior to the
termination of the Remedies License shall survive such termination of the
Remedies Licenses unless otherwise provided on such sub-license or transfer
document). The rights of Administrative Agent under the Remedies License are
assignable by Administrative Agent (without the consent of such Grantor) in
connection with (a) any sale or other disposition of Collateral in accordance
with the Loan Documents to the extent necessary or appropriate to permit the
purchaser of such Collateral to have continuing and royalty-free, worldwide
rights with respect to such Collateral or (b) any assignment or other transfer
by Administrative Agent of all or any part of its rights under and in accordance
with the Loan Documents. Upon or at any time after the occurrence and during the
continuance of any Event of Default, each Grantor will deliver to Administrative
Agent (at Administrative Agent's request but at such Grantor's expense) a copy
of all such Intellectual Property Collateral and all related other Collateral in
a form requested by Administrative Agent. Administrative Agent's rights as a
licensee under this Section constitute a separately enforceable contract from
the balance of this Security
Agreement.
5.5. Indemnity and Expenses.
a. Each Grantor agrees (jointly and severally) to indemnify
and hold Administrative Agent and each Lender harmless from and against any and
all claims, losses and liabilities arising out of or in any manner resulting
from any or all of the following: (1) any Grantor's failure to perform or
otherwise observe any of its obligations hereunder, or (2) Administrative
Agent's enforcement of any of the provisions hereof, or (3) any Grantor's gross
negligence, misrepresentation, willful misconduct or fraud.
b. Upon demand, each Grantor (jointly and severally) will pay
Administrative Agent the amount of any and all costs and expenses that
Administrative Agent or any Lender may incur in connection with any of the
matters described under clause "a" of this Section. Without limitation, each
Grantor's obligation to reimburse Administrative Agent for such fees, costs and
expenses includes all reasonable fees and disbursements of Administrative
Agent's or any Lender's counsel and any other experts and agents that
Administrative Agent or any Lender may retain in connection herewith (whether or
not litigation is commenced).
c. If any Grantor fails or refuses to pay Administrative Agent
any amount due hereunder or to otherwise deliver to Administrative Agent any
property required to be delivered hereunder, then such amount (or, as
appropriate, the fair market value of such property) will accrue interest until
paid or delivered at a per annum rate equal to two percent (2%) per annum in
excess of the highest rate then otherwise applicable to indebtedness under the
Credit Agreement (or the maximum amount permitted by applicable law, whichever
is less).
5.6. Administrative Agent's Rights Upon Occurrence of Liquidation
Events.
a. Right to Certain Payments and Distributions. Upon the
occurrence of any Liquidation Event, any payment or distribution of any kind or
character (whether in cash, securities or other property) that but for this
Security Agreement would be payable or deliverable to a Grantor must instead be
paid or delivered directly to Administrative Agent for application on the
Secured Obligations, whether or not then due or mature.
b. Non-Cash Payments and Distributions. Notwithstanding the
provisions of Clause "a" of this Section, if Administrative Agent receives
delivery of any such payment or distribution in connection with a Liquidation
Event in a form other than cash, then Administrative Agent may hold such
property as additional Collateral for the Secured Obligations, and neither any
Grantor nor any other Obligor of the Secured Obligations will be entitled to a
credit with respect to the Secured Obligations, nor will the Secured Obligations
otherwise be adjusted in any respect, until such time as Administrative Agent
(in its sole and absolute discretion) has sold, discounted or otherwise
liquidated such distribution (at a price considered by Administrative Agent to
be in its sole best interest) and then (subject to the terms of Section 7.8),
such credit or adjustment to the Secured Obligations will be limited only to the
net cash proceeds realized therefrom after the payment of all costs and expenses
associated with such sale or liquidation.
c. Collection of Payments and Distributions. In addition to
any rights otherwise permitted under the Loan Documents or applicable law, each
Grantor hereby irrevocably authorizes and empowers Administrative Agent, upon
the occurrence of a Liquidation Event, to file and/or vote claims and take such
other proceedings, in each instance in Administrative Agent's own name or in the
name of a Grantor, or otherwise, all as Administrative Agent may deem reasonably
necessary or advisable for the enforcement of this Security Agreement. Each
Grantor further agrees duly and promptly (i) to take such action as may be
requested by Administrative Agent to assist in the collection and/or compromise
of any amounts owed to any Grantor, and (ii) to file appropriate proofs of claim
in respect of such amounts, and (iii) to execute and deliver to Administrative
Agent on demand such powers of attorney, proofs of claim, assignments of claim
or other instruments as may be requested by Administrative Agent to enable
Administrative Agent to enforce any and all claims upon or with respect to such
amounts, and (iv) to collect, compromise and receive any and all payments or
distributions which may be payable or deliverable at any time upon or with
respect to such amounts.
5.7. Delivery of Payments and Distributions. If any Grantor receives
any payment, distribution or any other funds or property in contravention of the
provisions hereof or any other Loan Document, then such Grantor must immediately
forthwith deliver such payment, distribution or other funds or property (or
proceeds thereof) to Administrative Agent in precisely the form received (except
for the endorsement or assignment without recourse of such Grantor where
necessary) for application on the Secured Obligations (or, at Administrative
Agent's option, held as additional Collateral therefor), whether or not then due
or mature. Until such funds or property are delivered to Administrative Agent,
such Grantor must hold such payment, distribution or other funds or property (or
proceeds thereof) (a) in trust for the benefit of and as property of
Administrative Agent and (b) separate from (i.e., not commingled with) its other
assets. If a Grantor fails or refuses to make any such endorsement or
assignment, then Administrative Agent (or any of its officers or employees) are
hereby irrevocably authorized by such Grantor to make the endorsement and/or
assignment.
5.8. Cooperation and Assistance. Each Grantor agrees (during the
existence of a Default) to take any actions that Administrative Agent may
reasonably request in order to enable Administrative Agent and each Lender to
receive the full rights and benefits granted to Administrative Agent and each
Lender by the Loan Documents. Each Grantor further agrees that, during the
existence of a Default or an Event of Default, each Grantor will assist and
cooperate with Administrative Agent (and will use its best efforts to cause
others to assist and cooperate with Administrative Agent) to ensure that each
Grantor continues (a) to operate in the normal course of business, and (b) to
fulfill all of its legal, regulatory and contractual obligations and (c) to
otherwise be properly and professionally managed. At Administrative Agent's
request and the expense of Grantors (jointly and severally), at any time during
the existence of an Event of Default, such assistance and cooperation may
include the employment of (and, to the maximum extent not prohibited by the
rules, regulations and orders of any Official Body with jurisdiction, the
delegation of appropriate management authority to) one or more qualified and
independent consultants and professional managers acceptable to Administrative
Agent to assist in the interim operations of Grantors; all of which each Grantor
hereby agrees not to challenge.
ARTICLE 6: DEFINITIONS
6.1. Credit Agreement Definitions. Unless otherwise defined herein or
the context otherwise requires, terms used in this Security Agreement (including
the preamble and recitals hereof) have the meanings provided in the Credit
Agreement.
6.2. Rules of Construction. The rules of interpretation and
construction set forth in Section 9.2 of the Credit Agreement apply to the
interpretation and construction of this Security Agreement.
6.3. Certain Terms. The following terms (whether or not underscored)
when used in this Security Agreement (including the preamble and recitals
hereof) have the following meanings:
a. "Administrative Agent" means MCG Finance Corporation and
any successor, assignee, transferee, pledgee or participant thereof.
b. "Borrower(s)" means, individually and collectively, each
Borrower under and as defined in the Credit Agreement, including any successor
or assignee thereof.
c. "Collateral" is defined in Section 1.1.
d. "Computer Software Collateral" is defined in Section 1.1.
e. "Contract Rights" is defined in Section 1.1.
f. "Copyright Collateral" is defined in Section 1.1.
g. "Credit Agreement" is defined in the Recitals.
h. "Distribution" means all equity dividends, liquidating
dividends, shares or interests of equity resulting from (or in connection with
the exercise of) equity splits, reclassifications, warrants, options, non-cash
dividends, mergers, consolidations, distributions of capital accounts, and all
other distributions (whether similar or dissimilar to the foregoing) on or with
respect to any Pledged Equity or other shares or interests of equity
constituting Pledged Equity Collateral, but such term does not include
Dividends.
i. "Dividend" means cash dividends and cash distributions with
respect to any Pledged Equity or other Pledged Equity Property made in the
ordinary course of business, but such term shall not include a liquidating
dividend.
j. "Equipment" is defined in Section 1.1.
k. "Fixture" is defined in Section 1.1.
l. "Grantor" means each Person that from time to time executes
this Security Agreement (or a counterpart hereof or supplemental addendum
hereto) as a grantor hereunder, and any successor or permitted assignee thereof.
m. "Intellectual Property Collateral" means, collectively, the
Computer Software Collateral, the Copyright Collateral, the Patent Collateral,
the Trademark Collateral and the Trade Secrets Collateral, as defined in Section
1.1.
n. "Inventory" is defined in Section 1.1.
o. "License" means any authorization, permit, call sign,
frequency designation, consent, franchise, ordinance, registration, certificate,
license, agreement or other right filed with, granted by, or entered into by a
federal, state or local Official Body.
p. "Lien" means any security interest, mortgage, pledge,
hypothecation, assignment, deposit arrangement, option, claim, encumbrance, lien
(statutory or otherwise), charge against or interest in property to secure
payment of a debt or performance of an obligation or other priority or
preferential arrangement of any kind or nature whatsoever.
q. "Liquidation Event" means any foreclosure on or any sale of
all or any material part of the assets of any Grantor, or any liquidation,
dissolution or other winding up (partial or complete) of any Grantor or any
Grantor's business, or any sale, receivership, insolvency or bankruptcy
proceeding, any assignment for the benefit of creditors, or any other proceeding
by or against any Grantor or its assets for any relief under any bankruptcy or
insolvency law relating to the relief of debtors, readjustment of indebtedness,
arrangements, reorganizations, compositions or extensions.
r. "Official Body" means any federal, state, local, or other
government (or any political subdivision, agency, authority, bureau, commission,
department or instrumentality thereof) and any court, tribunal, grand jury or
arbitrator, in each instance whether foreign or domestic.
s. "Operating Agreements" means any consulting agreement,
management agreement, employment agreement, cost allocation agreement or other
similar agreement relating to the operation of any Grantor's business.
t. "Patent Collateral" is defined in Section 1.1.
u. "Person" means any natural person, corporation,
partnership, limited liability company, firm, association, trust, government,
governmental agency or any other entity, whether acting in an individual,
fiduciary or other capacity.
v. "Pledged Equity" means all shares of capital stock and all
other forms of equity or ownership rights and interests (whether in the form of
partnership interests, membership interests or otherwise) of or in any
corporation, partnership, limited liability company business trust or other
business entity.
w. "Pledged Equity Collateral" is defined in Section 1.5.
x. "Pledged Equity Issuer" means each Person who is an issuer
of Pledged Equity Collateral.
y. "Pledged Equity Property" means all Pledged Equity and all
other forms of equity interests and rights, all other securities (including,
without limitation, all options, warrants and puts for Pledged Equity), all
assignments of any amounts due or to become due, all other instruments which are
now being delivered by any Pledgor to Administrative Agent or may from time to
time hereafter be delivered by any Pledgor to Administrative Agent for the
purpose of pledge under the Security Agreement, and all proceeds of any of the
foregoing.
z. "Pledgor" means each Person (a) who is a Grantor hereunder
and (b) who pledges Pledged Equity Collateral.
aa. "Related Contracts" is defined in Section 1.1.
bb. "Secured Obligations" is defined in Section 1.2.
cc. "Security Agreement" means this Master Security Agreement,
Collateral Assignment and Pledge and all exhibits, schedules and supplemental
addenda hereto, all as may be amended and otherwise modified from time to time
hereafter.
dd. "Securities Act" means the Securities Act of 1933, as
amended from time to time, and as implemented by the Securities Exchange
Commission.
ee. "Trademark Collateral" is defined in Section 1.1.
ff. "Trade Secrets Collateral" is defined in Section 1.1.
gg. "UCC" means the Uniform Commercial Code as in effect in
the Commonwealth of Virginia or, if the laws of some other jurisdiction
otherwise dictates, then the Uniform Commercial Code as in effect in the
jurisdiction whose laws govern the interpretation of the relevant provisions of
this Security Agreement.
6.4. UCC Definitions. Unless otherwise defined herein or the context
otherwise requires, terms for which meanings are provided in the UCC are used in
this Security Agreement (including in the preamble and recitals hereof) with
such meanings.
ARTICLE 7: MISCELLANEOUS PROVISIONS
7.1. Loan Document. This Security Agreement and each separate
assignment executed in connection herewith are Loan Documents executed pursuant
to the Credit Agreement and (unless otherwise expressly indicated herein) are to
be construed, administered and applied in accordance with the terms and
provisions thereof.
7.2. Amendments. No amendment to or waiver of any provision of this
Security Agreement, nor consent to any departure by any Grantor herefrom, shall
in any event be effective unless such amendment, waiver or consent is in writing
and signed by Administrative Agent. Any such waiver or consent will be effective
only in the specific instance and for the specific purpose for which given.
7.3. Addresses for Notices. Any notice, request, consent, waiver or
other communication required or permitted under or in connection with this
Security Agreement will be deemed satisfactorily given if it is in writing and
is delivered either personally to the addressee thereof, or by prepaid
registered or certified U.S. mail (return receipt requested), or by a nationally
recognized commercial courier service with next-day delivery charges prepaid, or
by telegraph, or by facsimile (voice confirmed), or by any other reasonable
means of personal delivery to the party entitled thereto at its respective
address set forth below its signature to this Security Agreement (or, if blank,
then to such party at its address or facsimile number set forth in the Credit
Agreement). If any Grantor fails to insert an address below (and in the Credit
Agreement), then such failure shall constitute a designation of its last known
address as the address for all notices, including notices of default and sale.
Any party to this Security Agreement may change its address or facsimile number
for notice purposes by giving notice thereof to the other parties hereto in
accordance with this Section, provided that such change shall not be effective
until 2 calendar days after notice of such change. All such notices and other
communications will be deemed given and effective (a) if by mail, then upon
actual receipt or 5 calendar days after mailing as provided above (whichever is
earlier), or (b) if by facsimile, then upon successful transmittal to such
party's designated number, or (c) if by telegraph, then upon actual receipt or 2
Business Days after delivery to the telegraph company (whichever is earlier), or
(d) if by nationally recognized commercial courier service, then upon actual
receipt or 2 Business Days after delivery to the courier service (whichever is
earlier), or (e) if otherwise delivered, then upon actual receipt.
7.4. Severability. Wherever possible, each provision of this Security
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law. If any provision of this Security Agreement shall be prohibited
by or invalid under such law, then such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Security Agreement.
7.5. Governing Law; Entire Agreement. This Security Agreement shall be
governed by and construed in accordance with the internal laws of the
Commonwealth of Virginia, except to the extent that the validity or perfection
of the security interest, collateral assignment or pledge hereunder (or remedies
hereunder) in respect of any particular Collateral are required to be governed
by the laws of a
jurisdiction other than the Commonwealth of Virginia. This Security Agreement
and the other loan documents constitute the entire understanding among the
parties hereto with respect to the subject matter hereof and supersede any prior
agreements (written or oral) with respect thereto.
7.6. Reinstatement. To the maximum extent not prohibited by applicable
law, this Security Agreement shall continue to be effective or be reinstated if
at any time any amount received by Administrative Agent or any Lender in respect
of the Credit Agreement or any other Loan Document is rescinded or must
otherwise be restored or returned by Administrative Agent or such Lender upon
the insolvency, bankruptcy, dissolution, liquidation or reorganization of any
Grantor or upon the appointment of any receiver, intervenor, conservator,
trustee or similar official for any Grantor or any substantial part of any
Grantor's assets, or otherwise, all as though such payments had not been made.
7.7. Conflict Provision. In the event of any irreconcilable conflict
between the terms and conditions of this Security Agreement and the terms and
conditions of the Credit Agreement, the terms and conditions of the Credit
Agreement shall govern.
7.8. Incorporation of Separate IP Security Agreements and Collateral
Assignments of Material Contracts. Each representation, warranty, covenant and
further assurance by any Grantor contained in any separate assignment or
security agreement relating to any Intellectual Property Collateral or any
material contract executed in connection with the Credit Agreement is hereby
incorporated herein by reference.
7.9. Incorporation of Financing Statements and Exhibits Thereto. Each
UCC financing statement (including each exhibit thereto) executed by any Grantor
in connection with this Security Agreement is hereby incorporated herein by
reference.
7.10. Administrative Agent. References in this Security Agreement to
Administrative Agent shall mean either to Administrative Agent in such capacity
or (where appropriate) to Administrative Agent for the benefit of itself and
other Lenders. Unless otherwise indicated in this Security Agreement or the
other Loan Documents, all Collateral held and all payments received by
Administrative Agent are deemed to be held and received, respectively, for the
benefit of Lenders.
7.11. Waiver of Suretyship Defenses. Each Grantor hereby waives any and
all defenses and rights of discharge based on suretyship or impairment of
collateral (including any lack of attachment or perfection with respect thereto)
that it may now have or may hereafter acquire with respect to Administrative
Agent or any Lender or any of such Grantor's obligations hereunder or under any
other agreement that it may have or hereafter enter into with Administrative
Agent or any Lender.
7.12. Waiver of Subrogation. Until this Security Agreement is
terminated in accordance with Section 1.3, each Grantor hereby irrevocably
waives any claim or other rights which it may now have or may hereafter acquire
against any other Obligor that arise from the existence, payment, performance or
enforcement of any Grantor's obligations under this Security Agreement or any
other Loan Document, including any right of subrogation, reimbursement,
contribution, exoneration, or indemnification, any right to participate in any
claim or remedy of Administrative Agent or any Lender
against any other Obligor or any collateral which Administrative Agent or any
Lender now has or hereafter acquires, whether or not such claim, remedy or right
arises in equity, or under contract, statute or common law.
7.13. Waiver of Notice; Waiver of Bond. Each Grantor waives all rights
of notice and hearing of any kind prior to the exercise by Administrative Agent
or any Lender of its rights during the continuance of any Event of Default to
repossess the Collateral with judicial process or to replevy, attach or levy
upon the Collateral. Each Grantor waives the posting of any bond otherwise
required of Administrative Agent or any Lender in connection with any judicial
process or proceeding to obtain possession of, replevy, attach or levy upon
Collateral or other security for the Secured Obligations, to enforce any
judgment or other court order entered in favor of Administrative Agent or any
Lender, or to enforce by specific performance, temporary restraining order or
preliminary or permanent injunction this Security Agreement or any other Loan
Document.
7.14. Waiver of Liability. Each Grantor (a) agrees that neither
Administrative Agent nor any Lender (nor any director, officer, employee or
agent of Administrative Agent or any Lender) shall have any liability to any
Grantor (whether sounding in tort, contract or otherwise) for losses or costs
suffered or incurred by any Grantor in any way related to the transactions
contemplated or the relationship established by any Loan Document, or any act,
omission or event occurring in connection therewith, except for foreseeable
actual losses resulting directly from Administrative Agent or such Lender's own
gross negligence, willful misconduct or fraud, and (b) waives, releases and
agrees not to xxx upon any claim against Administrative Agent or any Lender (or
their directors, officers, employees or agents) whether sounding in tort,
contract or otherwise, except for claims for foreseeable actual losses resulting
directly and exclusively from Administrative Agent's or such Lender's own gross
negligence, willful misconduct or fraud. Moreover, whether or not such damages
are related to a claim that is subject to the waiver effected above and whether
or not such waiver is effective, neither Administrative Agent nor any Lender
(nor any director, officer, employee or agent of Administrative Agent or any
Lender) shall have any liability with respect to (and each Grantor hereby
waives, releases and agrees not to xxx upon any claim for) any special,
indirect, consequential, punitive or non-foreseeable damages suffered by any
Grantor in any way related to the transactions contemplated or the relationship
established by any Loan Document, or any act, omission or event occurring in
connection therewith.
7.15. Forum Selection and Consent to Jurisdiction. Any litigation in
any way related to any Loan Document, or any course of conduct, course of
dealing, statements (whether verbal or written), actions or inactions of
Administrative Agent or any Lender or any Grantor will be brought and maintained
exclusively in the courts of the Commonwealth of Virginia or in the United
States District Court for the Eastern District of Virginia; provided, however,
that any suit seeking enforcement against any Grantor or any Collateral may also
be brought (at Administrative Agent's or such Lender's option) in the courts of
any jurisdiction where such Collateral may be found or where Administrative
Agent or any Lender may otherwise obtain personal jurisdiction over such
Grantor. Each Grantor hereby expressly and irrevocably
submits to the jurisdiction of the courts of the Commonwealth of Virginia and of
the United States District Court for the Eastern District of Virginia for the
purpose of any such litigation as set forth above and irrevocably agrees to be
bound by any final and non-appealable judgment rendered thereby in connection
with such litigation. Each Grantor further irrevocably consents to the service
of process by registered or certified mail, postage prepaid, or by personal
service within or outside the Commonwealth of Virginia. Each Grantor hereby
expressly and irrevocably waives (to the fullest extent permitted by law) any
objection which it may have or hereafter may have to the laying of venue of any
such litigation brought in any such court referred to above and any claim that
any such litigation has been brought in an inconvenient forum. To the extent
that any Grantor has or hereafter may acquire any immunity from jurisdiction of
any court or from any legal process (whether through service or notice,
attachment prior to judgment, attachment in aid of execution or otherwise) with
respect to itself or its property, then such Grantor hereby irrevocably waives
such immunity in respect of its obligations under this Security Agreement.
7.16. Waiver of Jury Trial. Administrative Agent, each Lender and each
Grantor each hereby knowingly, voluntarily and intentionally waives any rights
it may have to a trial by jury in respect of any litigation (whether as claim,
counter-claim, affirmative defense or otherwise) in any way related to any Loan
Document, or any course of conduct, course of dealing, statements (whether
verbal or written), actions or inactions of Administrative Agent, any Lender or
any Grantor. Each Grantor acknowledges and agrees (a) that it has received full
and sufficient consideration for this provision (and each other provision of
each other Loan Document to which it is a party), and (b) that it has been
advised by legal counsel in connection herewith, and (c) that this provision is
a material inducement for Administrative Agent and each Lender entering into the
Loan Documents and funding Advances thereunder.
7.17. Counterparts. This Security Agreement may be executed in any
number of counterparts with the same effect as if all the signatures on such
counterparts appeared on one document. Each counterpart will be deemed to be an
original, but all counterparts together will constitute one and the same
instrument.
[BALANCE OF PAGE INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the parties hereto have executed this
Security Agreement, as an instrument under seal (whether or not any such seals
are physically attached hereto), through their duly authorized officers, as of
the date first written above.
ATTEST: NBG RADIO NETWORK, INC.
(as a Grantor)
By: /s/ Xxxx X. Xxxxxxxxx By: /s/ Xxxx X. Xxxxxx III
----------------------- -------------------------
Name: Xxxx X. Xxxxxxxxx Name: Xxxx X. Xxxxxx III
Title: Secretary Title: President
[CORPORATE SEAL]
Address: The Cascade Building
000 XX Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
ATTEST: XXXXX XXXXXX ENTERTAINMENT CORPORATION
(as a Grantor)
By: /s/ Xxxx X. Xxxxxxxxx By: /s/ Xxxx X. Xxxxxx III
----------------------- -------------------------
Name: Xxxx X. Xxxxxxxxx Name: Xxxx X. Xxxxxx III
Title: Secretary Title: President
[SEAL]
Address: The Cascade Building
000 XX Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
IN WITNESS WHEREOF, the parties hereto have executed this
Security Agreement, as an instrument under seal (whether or not any such seals
are physically attached hereto), through their duly authorized officers, as of
the date first written above.
WITNESS: MCG FINANCE CORPORATION
(as Administrative Agent)
By: /s/ Xxxx Xxxxxx By: /s/ X. Xxxxx Xxxxxxx
----------------------- -------------------------
Name: X. Xxxxx Xxxxxxx
Title: Executive Vice President
0000 Xxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
