EXHIBIT 2.13
GUARANTEE AND SECURITY AGREEMENT
THIS GUARANTEE AND SECURITY AGREEMENT is made as of the 30th day of June,
2005.
BETWEEN: MITEL NETWORKS OVERSEAS LIMITED, an international business
company formed under the laws of Barbados with registered
office at The Corporate Secretary Limited, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇. ▇▇▇▇▇▇▇ (hereinafter referred to as the
"Company") (hereinafter referred to as the "Company")
AND: HIGHBRIDGE INTERNATIONAL LLC, a limited liability company
formed under the laws of the Cayman Islands having an office
at c/o Highbridge Capital Management, LLC, 9 West 57th Street,
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇.▇.▇. ▇▇▇▇▇, as collateral
agent (in such capacity, the "Collateral Agent") for itself as
a holder and the other holders existing from time to time
(each a "Secured Party" and collectively, the "Secured
Parties"), from time to time of senior secured convertible
notes initially issued as of April 27, 2005, (as amended,
restated or supplemented from time to time the "Notes"),
issued by Mitel Networks Corporation, a corporation
incorporated under the laws of Canada (the "Issuer") pursuant
to a Securities Purchase Agreement dated April 27, 2005 (the
"Securities Purchase Agreement") by and among the Issuer and
the buyers party thereto.
RECITALS:
A. Pursuant to the Notes issued by the Issuer pursuant to the Securities
Purchase Agreement, the Issuer is indebted to the Secured Parties as
holders from time to time of the Notes.
B. The Company is a direct wholly-owned subsidiary of the Issuer; and the
Company will benefit from the arrangements under the issuance of the Notes
and the receipt of proceeds therefrom by the Issuer.
IT IS HEREBY AGREED AS FOLLOWS:
1. DEFINITIONS AND INTERPRETATION
1.1 In this Guarantee and Security Agreement unless the context otherwise
requires the following expressions shall bear the following respective
meanings:
GENERAL SECURITY AGREEMENT
(a) "APPLICABLE LAW" means the law of any one or more jurisdictions which is
applicable to the interpretation of the security
interests created herein, or to the exercise of any
power or discretion by the Company, the Collateral Agent
or the Receiver hereunder, whether by reason of the
domicile of the Company, the domicile of the Collateral
Agent, the domicile of the Receiver, the situs of the
whole or any part of the Collateral, or other connecting
factor (which is admissible under general principles of
law, including relevant principles of conflicts of laws)
and includes the Governing Law. Each of the parties
hereto shall determine the Applicable Law by reference
to the Governing Law, except where that party has actual
notice of the applicability hereto of another system or,
and each of the parties hereto shall obey the court
orders of a court validly claiming jurisdiction in
respect hereof;
(b) "COLLATERAL" means subject to the exclusions specifically provided
herein, any and all real and personal property in which
a security interest or floating charge can be taken,
reserved, created or granted, under any Applicable Law
and which is now or hereafter owned by the Company or in
which the Company now has or hereafter acquires any
interest of any nature whatsoever, as charged pursuant
to section 4 of this Guarantee and Security Agreement,
and including, without in any way limiting the
generality of the foregoing, all equipment, fixtures,
computer hardware and software, inventory, goods,
instruments, negotiable collateral, securities,
documents of title, chattel paper, accounts, money,
contract rights, intangibles, credits, claims, demands,
debts, chooses in action, trade-marks, patents, and all
other intellectual property, and all proceeds, products
and accessions from, of and to any thereof;
(c) "COMPANY" means any entity with corporate capacity (of whatsoever
kind) incorporated or otherwise brought into existence
in any part of the world and includes companies, limited
liability companies and societies with restricted
liability which have liability hereunder;
(d) "COUNTRY OF means any one of the country of residence, nationality
DOMICILE" or domicile (as appropriate);
(e) "DEED" means any instrument in writing whether in one or more
counterparts, in the form appropriate under Applicable
Law, and includes deeds, documents under seal,
contracts, declarations in writing, memoranda, written
resolutions of the Trustee and other instruments in
writing;
(f) "EVENT OF DEFAULT" means an event which constitutes an Event of Default as
described in the Notes, committed by the Company;
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GENERAL SECURITY AGREEMENT
(g) "IP LICENCE RIGHTS" means all rights of the Company as licensee under the
Intellectual Property Licence Agreement, dated May 29,
2001 between Mitel Knowledge Corporation and the
Company;
(h) "IP SUB-LICENCE means all rights of the Company as licensor under the
RIGHTS" Intellectual Property Licence Agreement, effective April
28, 2001 between the Company and Networks International
Limited;
(i) "PERSON" means any individual or any body of persons corporate or
unincorporate, and includes individuals, companies,
bodies corporate, limited liability companies, societies
with restricted liability, partnerships (whether limited
or general), firms, syndicates, joint ventures, trusts,
unincorporated associations, governmental authorities
and agencies, and any legal entity or any other
association of persons;
(j) "PROPER LAW" means the law, as determined in accordance with this
Guarantee and Security Agreement, to the exclusive
jurisdiction of which the rights of all parties and the
construction and effect of each and every provision of
this Guarantee and Security Agreement shall be subject
and by which such rights, construction and effect shall
be construed and regulated;
(k) "PROPERTY ACT" means the Property Act, Cap. 236 of the laws of Barbados
as from time to time amended and every statute
substituted therefor; and in the case of such amendment
or substitution, any references in the by-laws of the
Company to provisions of the Act or to specific
provisions of the Act, shall be read as references to
the provisions as amended or substituted therefor in the
amendment or the new statute or statutes.
1.2 Capitalised terms not defined in this Guarantee and Security Agreement,
unless otherwise indicated, shall have the meanings assigned to such terms
in the Notes.
1.3 Terms defined elsewhere in this Guarantee and Security Agreement, unless
otherwise indicated, shall have such meaning in every section herein.
1.4 Where the context permits, any reference to "Collateral" in this Guarantee
and Security Agreement, shall be deemed to be a reference to "Collateral
or any part thereof."
1.5 Unless the context clearly requires otherwise, the words "hereof "herein"
and "hereunder" and words of similar import, when used in this Guarantee
and Security Agreement, shall refer to this Guarantee and Security
Agreement as a whole and not to any particular section; wherever the word
"include" "includes" or "including" is used in any provision of this
Guarantee and Security Agreement, it shall be deemed to be followed by the
words "without limitation" unless clearly indicated otherwise.
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GENERAL SECURITY AGREEMENT
1.6 The singular includes the plural and the plural includes the singular; and
the masculine gender includes the feminine and neuter genders.
1.7 The division of this Guarantee and Security Agreement into sections,
articles and paragraphs, the provision of a table of contents and the
insertion of headings are for convenience of reference only and shall not
affect the construction or interpretation hereof.
2. GUARANTEE OF OBLIGATIONS OF ISSUER
2.1 The Company hereby unconditionally GUARANTEES to the Collateral Agent and
each of the Secured Parties payment of all present and future
indebtedness, liabilities and obligations, whether direct or indirect,
absolute or contingent, now or hereafter owing by the Issuer to the
Secured Parties (collectively, the "Obligations"). The Company shall pay
to the Collateral Agent for itself and the Secured Parties, on demand by
the Collateral Agent, all amounts owing by the Company to the Collateral
Agent for itself and the Secured Parties hereunder and the Company shall
pay to the Collateral Agent for itself and the Secured Parties interest
thereon after demand at the highest rate of interest payable on the
Obligations or any part or parts thereof.
2.2 No change in the name, objects, capital or constitution of the Issuer or
any other matter relating to the Issuer, shall in any way affect the
liability of the Company, either with respect to transactions occurring
before or after any such change.
2.3 The Collateral Agent, without consent of the Company and without
exonerating in whole or in part the Company may grant time, renewals,
extensions, indulgences, releases and discharges to the Issuer and all
other persons (including the Company, and any other guarantor), may take
securities from and give the same and any or all existing securities up to
the Issuer and all other persons (including the Company, and any other
guarantor), may abstain from taking securities from the Issuer and all
other persons (including the Company, and any other guarantor), or from
perfecting securities of the Issuer and all other persons (including the
Company, and any other guarantor), may accept compositions from the Issuer
and all other persons (including the Company, and any other guarantor),
and may otherwise change the terms of any of the debts and liabilities
hereby guaranteed and otherwise deal with the Issuer and all other persons
(including the Company, and any other guarantor), as the Collateral Agent
may see fit, and that all dividends, compositions, and moneys received by
the Collateral Agent from the Issuer or from any other persons or estates
capable of being applied by the Collateral Agent in reduction of the
Obligations hereby guaranteed, shall be regarded for all purposes as
payments in gross, and the Collateral Agent shall be entitled to prove
against the estate of the Issuer upon any insolvency or winding-up in
respect of the whole of said debts and liabilities, and the Company shall
have no right to be subrogated to the Collateral Agent in respect of any
such proof or otherwise until the Collateral Agent shall have received
from such estate or from the Company, payment in full of its claim with
interest.
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GENERAL SECURITY AGREEMENT
2.4 This shall be a continuing guarantee, and shall cover and secure any
ultimate balance owing to the Secured Parties, including all costs,
charges and expenses which any Secured Party or the Collateral Agent may
incur in enforcing or obtaining payment of the sums of money due to the
Secured Parties from the Issuer either alone or in conjunction with any
other corporation, person or persons, or otherwise howsoever, or
attempting to do so. The Collateral Agent shall not be obliged to seek any
recourse against the Issuer or other persons or the securities it may hold
before being entitled to payment from the Company of all and every
Obligations hereby guaranteed. The Company hereby renounces the benefits
of discussion and division. The Company renounces to claim against, or set
up against, the Collateral Agent any right which the Company may have to
be subrogated in any of the rights, hypothecs, privileges and other
security held from time to time by the Collateral Agent. Every certificate
issued under the hand of a duly authorised officer of the Collateral
Agent, purporting to show the amount at any particular time due and
payable to the Collateral Agent, and covered by this guarantee, shall be
received as conclusive evidence (in the absence of manifest error) as
against the Company that such amount is at such time so due and payable to
the Collateral Agent and is covered hereby.
2.5 All payments made by the Company under this guarantee shall be made free
and clear and without deduction for any and all present and future taxes,
levies and withholdings, including without limitation stamp and
documentary taxes (collectively, the "Taxes"), but excluding taxes imposed
on the net income of the Collateral Agent. If the Company is required by
law to deduct any Taxes from or in respect of any amount paid or payable
hereunder, including without limitation any additional amount or amounts
payable pursuant to this paragraph, such amount shall be increased as
necessary so that the Collateral Agent receives an amount or amounts which
are, in the aggregate, equal to the sum it would have received had no such
deduction been made and the Company shall pay same to the relevant taxing
authority and, upon request by the Collateral Agent, shall give to the
Collateral Agent acceptable evidence of such payments. The Company
covenants and agrees to indemnify and save harmless the Collateral Agent
from and against any and all Taxes paid or payable by the Collateral Agent
in respect of any amounts paid or payable under this guarantee.
3. COVENANT TO PAY AND OBLIGATIONS SECURED
3.1 The Company hereby covenants that it will on demand, pay to the Collateral
Agent for itself and the Secured Parties, all moneys, and discharge all
Obligations. Without limitation, the Obligations include:
(a) all of the indebtedness, liabilities and obligations of the Issuer
under the Securities Purchase Agreement and the Notes as guaranteed
hereunder; and
(b) all interest due to the date of payment, all commissions, fees, and
other charges, and all legal and other costs and expenses incurred
by the Collateral Agent in relation to the Company or the
Collateral.
3.2 The Company executes this Guarantee and Security Agreement for valuable
consideration and as security for the payment of all Obligations of the
Company to the Collateral Agent
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GENERAL SECURITY AGREEMENT
4. GRANT OF MORTGAGES, CHARGES AND SECURITY INTERESTS
4.1.1 The Company hereby mortgages and charges to and in favour of the
Collateral Agent as and by way of a fixed and specific mortgage and
charge, and grants to the Collateral Agent a security interest in:
(a) the IP Licence Rights ;
(b) the IP Sub-Licence Rights; and
(c) all income, royalties and other payments now or hereafter due and/or
payable with respect to the IP Sub-Licence Rights.
4.1.2 The Company shall give notice to Mitel Networks International
Limited (as licensee in respect of IP Sub-Licence Rights), of the
assignment of its payment obligations to the Collateral Agent For the
purpose of ensuring performance of its obligations hereunder, the Company
shall execute a notice of assignment in the form annexed hereto as Exhibit
A (the "Assignment Notice I"). The Company hereby irrevocably and by way
of further security appoints the Collateral Agent (and the persons
deriving title under the Collateral Agent), to be its true and lawful
attorney, with full power and authority in the name of and on behalf of
the Company, and as the true act and deed or otherwise of the Company (a)
to deliver the Assignment Notice I on its behalf in accordance with this
section 4.1.2, (b) to execute any other notices of assignment, seal, do
and deliver and otherwise perfect any deeds, transfers or other documents
which the Company may require for perfecting title to that part of the
Collateral charged under section 4.1.1 (c) or for vesting or enabling the
Collateral Agent to vest the same in itself, its nominee or any purchaser
or to redeliver the same thereafter, (c) to execute, seal, do and deliver
and otherwise perfect all such deeds, assurances, agreements,
instructions, instruments, acts and things which may be required for the
full exercise of all or any of the rights of the Collateral Agent in the
Collateral charged under section 4.1.l(c), and the Company hereby ratifies
and confirms and agrees to ratify and confirm any instrument, act or thing
which the Collateral Agent as such attorney may properly execute or do
under this section 4.1.2.
4.2.1 The Company hereby assigns, transfers and sets over to the Collateral
Agent, and grants to the Collateral Agent a security interest in and by
way of a fixed charge:
(a) all book debts, accounts and other amounts receivable, claims,
demands, moneys and choses in action which now are or which may at
any time hereafter be due or owing to or owned by the Company, which
are due owing or accruing due or which hereafter may become due,
owing or accruing due and all claims of whatsoever nature or kind
which the Company has or may have from any of the debtors identified
on Schedule I hereto;
(b) all other debts, accounts, claims, demands moneys and choses in
action which now are or which may at any time hereafter be due or
owing to, or owned by the Company from any of the debtors identified
on Schedule I hereto,
(c) all contracts, securities, bills, notes, lien notes, judgements,
chattel mortgages, mortgages and all other rights and benefits which
are vested in the Company (or anyone on behalf of the Company), in
respect of any of the debts, accounts, claims, moneys and choses in
action described in (a) and (b) above, or any part
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GENERAL SECURITY AGREEMENT
thereof, or which hereafter may become vested in the Company in
respect of or as security for any of the debts, demands, choses in
action and claims described in (a) and (b) above; and
(d) all books, accounts, invoices, letters, papers and documents in any
way evidencing, recording or relating to any of the debts, demands,
choses in action and claims described in (a) and (b) above, or by
which the same are or may hereafter be secured, evidenced,
acknowledged or made payable.
4.2.2 The Company shall give notice to each debtor identified on Schedule I
hereto of the assignment of its payment obligations to the Collateral
Agent. For the purpose of ensuring performance of its obligations
hereunder, the Company shall execute a notice of assignment in the form
annexed hereto as Exhibit B (the "Assignment Notice II"). The Company
hereby irrevocably and by way of further security appoints the Collateral
Agent (and the persons deriving title under the Collateral Agent), to be
its true and lawful attorney, with full power and authority in the name of
and on behalf of the Company, and as the true act and deed or otherwise of
the Company (a) to deliver the Assignment Notice II on its behalf in
accordance with this section 4.2.2, (b) to execute any other notices of
assignment, seal, do and deliver and otherwise perfect any deeds,
transfers or other documents which the Company may require for perfecting
title to that part of the Collateral charged under section 4.2.1 or for
vesting or enabling the Collateral Agent to vest the same in itself, its
nominee or any purchaser or to redeliver the same thereafter, (c) to
execute, seal, do and deliver and otherwise perfect all such deeds,
assurances, agreements, instructions, instruments, acts and things which
may be required for the full exercise of all or any of the rights of the
Collateral Agent in the Collateral charged under section 4.2.1, and the
Company hereby ratifies and confirms and agrees to ratify and confirm any
instrument, act or thing which the Collateral Agent as such attorney may
properly execute or do under this section 4.2.2.
4.3 The Company hereby mortgages and charges to and in favour of the
Collateral Agent as and by way of a floating charge, and grants to the
Collateral Agent a security interest in, its business and undertaking and
all its property and assets, real and personal, moveable or immovable, of
whatsoever nature and kind, both present and future (other than property
and assets hereby validly assigned or subjected to a specific mortgage,
charge or security interest by section 4.1 or section 4.2 hereof and the
exceptions hereinafter contained).
4.4 The Company hereby assigns, mortgages and charges in favour of the
Collateral Agent and grants to the Collateral Agent a security interest in
the proceeds arising from any of the assets referred to in this section 4.
4.5 In the event that any first fixed charge is deemed or construed as a
floating charge, immediately on the occurrence of an Event of Default,
such floating charge shall automatically crystallise and operate as a
fixed charge.
4.6 The security constituted by this Guarantee and Security Agreement is
continuing, and will extend to the ultimate balance of the Obligations
owing, notwithstanding any intermediate payment or discharge in whole or
in part.
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GENERAL SECURITY AGREEMENT
4.7 The security constituted by this Guarantee and Security Agreement is in
addition to and is not in any way prejudiced by any other security now or
subsequently held by the Collateral Agent.
5. LIMITED EXCEPTIONS TO GRANT OF CHARGE
5.1 The last day of any term reserved by any lease, oral or written, or any
agreement therefor, now held or hereafter acquired by the Company, and
whether falling within the general or particular description of the
Collateral, is hereby and shall be excepted out of the mortgages, charges
and security interests hereby or by any other instrument created, but the
Company shall stand possessed of the reversion of one day remaining in the
Company in respect of any such term for the time being demised, as
aforesaid, upon trust to assign and dispose of the same as any purchaser
of such term shall direct.
6. RIGHTS OF SET-OFF
6.1 The Company grants to the Collateral Agent the right to set off against
any and all accounts, credits or balances maintained by it with the
Collateral Agent, the aggregate amount of any of the Obligations. The
Collateral Agent may at any time (including without limitation upon the
occurrence of an Event of Default, have the right to appropriate and apply
to the payment of the Obligations owing to it (whether or not then due),
and (as security for such Obligations) any and all balances, credits,
deposits, accounts or moneys of the Company then or thereafter maintained
with or otherwise held by such Collateral Agent, and the Company hereby
further grants to the Collateral Agent a continuing security interest in,
by way of fixed charge, any and all balances, credits, deposits, accounts
or moneys of the Company then or thereafter maintained with or otherwise
held by such Collateral Agent.
7. REPRESENTATIONS, COVENANTS AND AGREEMENTS OF COMPANY
7.1 The Company and the Collateral Agent agree that they have not agreed to
postpone the time for attachment of the security interests granted hereby
with respect to the Company's presently existing Collateral and that such
security interests shall attach to the Collateral acquired after the date
hereof as soon as the Company has rights in such Collateral.
7.2 The Company agrees with the Collateral Agent that until the termination of
this Agreement in accordance with section 15 hereof, it shall not without
the prior written consent of the Collateral Agent:
(a) change the location of its registered office, place of business or
principal place of residence without providing the Collateral Agent
with fifteen days' prior written notice;
(b) remove the Schedule I Property from the locations listed herein
unless such removal is a sale of the Schedule I Property in the
ordinary course of the Company's business and for the purposes of
carrying on such business or keep the Schedule I Property at a
location other than the location(s) listed herein; and
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GENERAL SECURITY AGREEMENT
(c) it assign any of its rights or obligations under this Guarantee and
Security Agreement.
7.3 The Company agrees with the Collateral Agent that it shall:
(a) repair according to the nature and description thereof, and the
Collateral Agent may, whenever it deems necessary, either in person
or by agent, enter upon the Company's property and inspect the
Collateral and the reasonable cost of such inspection shall be
payable on demand and added to the Obligations and the Collateral
Agent may make repairs as it deems necessary, and the cost thereof
shall be payable on demand and added to the Obligations; and
(b) promptly effect all registrations, filings, recordings and all
re-registrations, re-filings and re-recordings of or in respect of
this Guarantee and Security Agreement and the security interests
granted herein and hereunder, in such offices of public record and
at such times as may be necessary or of advantage in perfecting,
maintaining and protecting the validity, effectiveness and priority
hereof and/or of such security interests.
7.4 The Company hereby agrees that it will at all times, both before and after
default, do or cause to be done such additional things and execute and
deliver or cause to be executed and delivered all such further acts and
documents as the Collateral Agent may reasonably require for the better
mortgaging, charging, transferring, assigning, confirming and granting of
security interests in the present or future Collateral to the Collateral
Agent.
7.5 The Company represents and warrants to the Collateral Agent, as a
condition of the security interests granted herein that:
(a) no order has been, no resolution passed and no petition filed for
the winding-up of the Company;
(b) it does not appear from any balance sheet of the Company or by a
certificate of or other issuance by the auditors of the Company that
the liabilities of the Company (both secured and unsecured) exceed
its tangible assets;
(c) the Company at the date hereof has not committed or threatened to
commit any act of bankruptcy under the Bankruptcy Act of Barbados,
or made any assignment or proposal in bankruptcy;
(d) no proceedings with respect to the Company have been commenced under
the Companies Act or the Bankruptcy Act of Barbados, and the Company
has not sought relief or consented to the filing of a petition
against it under any law which involves any compromise of any
creditor's rights against the Company; and
(e) no writ of execution or any other process of any court or distress
or analogous process has been levied upon the property of the
Company or any part thereof.
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GENERAL SECURITY AGREEMENT
8. POWER OF ATTORNEY
8.1 The Company, by way of further and additional security, irrevocably
appoints the Collateral Agent, and each receiver appointed hereunder and
any of their delegates and sub-delegates effective only upon the
occurrence of an Event of Default, to be its attorney to take any action
which the Company is obliged to take under this Guarantee and Security
Agreement, and the Company hereby ratifies and confirms whatever any of
the foregoing (in their capacity as attorney hereunder), does or purports
to do pursuant to its appointment under this section.
9. DEFAULT
9.1 Upon and after the occurrence of an Event of Default that has not been
cured or waived in accordance with the provisions of the Notes, the
Obligations shall, at the option of the Collateral Agent, become payable
and the security granted pursuant to this Guarantee and Security Agreement
shall become enforceable.
10. REMEDIES OF COLLATERAL AGENT
10.1 Whenever the security granted pursuant to this Guarantee and Security
Agreement shall have become enforceable, and so long as it shall remain
enforceable, the Collateral Agent may forthwith and without further
notice, proceed to realise such security and to enforce its rights b:
(a) entry;
(b) the appointment by instrument in writing of a receiver or receivers
of the Collateral or any part thereof (which receiver or receivers
may be any person or persons, whether an officer or officers or
employee or employees of the Collateral Agent or not and the
Collateral Agent may remove any receiver or receivers so appointed
and appoint another or others in his or their stead);
(c) proceedings in any court of competent jurisdiction for the
appointment of a receiver or receivers or for sale of the Collateral
or any part thereof; or
(d) any other action, suit, remedy or proceeding authorised or permitted
hereby or by law or by equity.
10.2 In addition, the Collateral Agent may file such proofs of claim and other
documents as may be necessary or advisable in order to have its claim
lodged in any bankruptcy, winding-up or other judicial proceedings
relating to the Company.
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GENERAL SECURITY AGREEMENT
10.3 Whenever the security granted pursuant to this Guarantee and Security
Agreement becomes enforceable, the Collateral Agent may enter upon, use,
occupy and possess the Collateral or any part thereof, free from all
encumbrances, liens and charges, except for Permitted Encumbrances,
without hindrance, interruption or denial of the same by the Company or by
any other person or persons save only a landlord pursuant to its rights of
reversion under any lease of real property on expiry of its term, and may
lease or sell the whole or any part or parts of the Collateral. Any sale
hereunder may be made by public auction, by public tender or by private
contract, with or without notice and with or without advertising and
without any other formality (except as required by law), all of which are
hereby waived by the Company. Such sale shall be on such terms and
conditions as to credit or otherwise and as to upset or reserve bid or
price as to the Collateral Agent in its sole discretion may seem
advantageous. Such sale may take place whether or not the Collateral Agent
has taken possession of the Collateral.
10.4 No remedy for the realisation of the security interests granted herein or
for the enforcement of the rights of the Collateral Agent shall be
exclusive of or dependent on any other such remedy, but any one or more of
such remedies may from time to time be exercised independently or in
combination.
10.5 Any and all payments made in respect of the Obligations from time to time
and moneys realised from any securities held therefor (including moneys
realised on any enforcement of this Guarantee and Security Agreement) may
be applied to such part or parts of the Obligations as the Collateral
Agent may see fit, and the Collateral Agent shall at all times and from
time to time have the right to change any appropriation as the Collateral
Agent may see fit.
10.6 To the fullest extent permitted by law, any right, power or discretion
conferred upon a receiver (either expressly or impliedly) upon a receiver,
may after the security created by this Guarantee and Security Agreement
becomes enforceable, be exercised by the Collateral Agent without first
appointing a receiver and notwithstanding the appointment of a receiver.
10.7 The Collateral Agent may exercise its powers herein, without further
notice and without restrictions contained in section 111 of the Property
Act, and whether or not it shall have appointed a receiver, all the powers
conferred on mortgagees by the Property Act as extended hereunder, and all
powers and discretions conferred expressly or under Applicable Law on a
receiver appointed hereunder.
10.8 Neither section 103 or section 108 of the Property Act, shall apply to the
security interests created by this Guarantee and Security Agreement, or to
any further security given by the Company to the Collateral Agent pursuant
to this Guarantee and Security Agreement.
11. RECEIVER
11.1 The term "Receiver" as used in this Guarantee and Security Agreement
includes a receiver and a receiver-manager, or other similar appointee
under Applicable Law.
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GENERAL SECURITY AGREEMENT
11.2 In addition to any other power, available under Applicable Law (each and
every such power being deemed to be available for exercise by the Receiver
as if expressly stated herein), any Receiver appointed under section 9.1
(b), shall have power to:
(a) take possession of and to use the Collateral or any part thereof;
(b) carry on the business of the Company (including, but not limited to,
the taking or defending of any actions or legal proceedings, and the
doing or refraining from doing all other things as to the receiver
may seem necessary or desirable in connection with the business,
operations and affairs of the Company);
(c) borrow money required for the maintenance, preservation or
protection of the Collateral or any part thereof or the carrying on
of the business of the Company;
(d) further charge the Collateral in priority to the security interests
of this Guarantee and Security Agreement as security for money so
borrowed; and
(e) without the restrictions as to notice or otherwise imposed by
section 111 of the Property Act, or the need to observe any of the
provisions of sections 108 or 109 of the Property Act, sell, lease
or otherwise dispose of the whole or any part of the Collateral on
such terms and conditions and in such manner as the receiver shall
determine.
11.3 The Collateral Agent shall not be responsible for any actions or errors of
omission by the receiver or receivers in exercising any such powers.
11.4 Every receiver appointed under this Agreement, shall give notice of its
appointment as receiver to any regulatory or judicial authority, pursuant
to any Applicable Law.
12. APPLICATION OF PROCEEDS:
12.1 All proceeds of any sale of, or other realisation upon, all or any part of
the Collateral pursuant to the Security Documents, including any
Collateral consisting of cash, shall, subject to section 10.5, be applied
by the receiver as follows:
(a) First, to the payment of all costs and expenses reasonably incurred
by the receiver in connection with such sale or otherwise in
connection with this Guarantee and Security Agreement or any of the
Obligations, including all court costs and the reasonable fees and
expenses of its agents and legal counsel and any other costs and
expenses reasonably incurred in connection with the exercise of any
right or remedy hereunder;
(b) Second, to the payment of the Obligations to the Collateral Agent in
accordance with the amounts of the Obligations owed to the
Collateral Agent for itself and the Secured Parties and outstanding
(whether or not the maturity thereof shall have been accelerated) as
of the date of such payment, until all of the Obligations shall have
been paid in full; and
(c) Third, to whomsoever is entitled by law thereto.
12.2 The Company will remain liable for any amounts remaining unpaid after any
liquidation, set-off and/or application under this Guarantee and Security
Agreement.
13. ADDITIONAL RIGHTS OF COLLATERAL AGENT
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GENERAL SECURITY AGREEMENT
13.1 The Collateral Agent may pay and satisfy the whole or any part of any
liens, taxes, rates, charges or encumbrances now or hereafter existing in
respect of any of the Collateral and such payments together with all
costs, charges and expenses which may be incurred in connection with
making such payments shall form part of the Obligations and shall be
Secured by the security interests granted herein. In the event of the
Collateral Agent satisfying any such lien, charge or encumbrance, it shall
be entitled to all the equities and securities of the person or persons so
paid and is hereby authorised to obtain any discharge thereof and hold
such discharge without registration for so long as it may deem advisable
to do so.
13.2 The Collateral Agent may assign, transfer and deliver to any transferee
any of the Obligations or any security or any documents or instruments
held by the Collateral Agent in respect thereof provided that no such
assignment, transfer or delivery shall release the Company from any of the
Obligations; and thereafter the Collateral Agent shall be fully discharged
from all responsibility with respect to the Obligations and security,
documents and instruments so assigned, transferred or delivered. Such
transferee shall be vested with all powers and rights of the Collateral
Agent under such security, documents or instruments but the Collateral
Agent shall retain all rights and powers with respect to any such
security, documents or instruments not so assigned, transferred or
delivered.
14. COSTS AND EXPENSES
14.1 The Company agrees to pay to the Collateral Agent forthwith on demand all
reasonable expenses incurred by the Collateral Agent in the perfection,
administration and enforcement of this Guarantee and Security Agreement
(including without limitation expenses incurred in considering and
protecting or improving the Collateral Agent's position, or attempting to
do so, whether before or after default), all amounts borrowed by the
receiver from the Collateral Agent as hereinbefore provided and all
reasonable costs, charges, expenses and fees (including, without limiting
the generality of the foregoing, the fees and expenses of any receiver and
legal fees on an Attorney-at-Law and client basis) of or incurred by the
Collateral Agent and by any receiver or receivers or agent or agents
appointed by the Collateral Agent in connection with the recovery or
enforcing of payment of any moneys owing hereunder, whether by
realisation, by taking possession or otherwise. All such sums, together
with interest thereon at the rate applicable to the Obligations, shall
form part of the Obligations and shall be Secured by the security
interests granted herein.
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GENERAL SECURITY AGREEMENT
15. EFFECTIVE DATE AND TERMINATION
15.1 This Agreement shall become effective according to its terms immediately
upon the execution hereof by the Collateral Agent and the Company. This
Agreement and the security interests granted herein and hereunder are in
addition to and not in substitution for any other agreement made between
the Collateral Agent and the Company or any other security granted by the
Company, the Issuer or any other Subsidiary or Guarantor to the Secured
Party, whether before or after the execution of this Agreement.
15.2 This Agreement is a continuing agreement, and shall not terminate or be
discharged until the earlier of (a) performance and indefeasible payment
in full of all of the Obligations and (b) the date on which a Qualified
IPO (as defined in the Notes) is consummated. Upon termination of this
Agreement in accordance with the provisions of this section 15.2, the
Collateral Agent shall, at the request and expense of the Company, make
and do all such acts and things and execute and deliver all such
releases, memoranda of satisfaction, instruments, agreements and
documents as the Company considers necessary or desirable to discharge
the security interests granted herein and hereunder, to release and
discharge the Collateral therefrom and to record such release and
discharge in appropriate offices of public record.
16. GENERAL
16.1.1 Notices: All notices, requests, demands or other communication by the
terms hereof required or permitted to be given by either party to the
other shall, unless otherwise specifically provided for herein, be given
in writing and be delivered by personal delivery or courier delivery and
by transmittal by electronic means of communication addressed to such
other party as follows:
If to the Collateral Agent: If to the Company:
Highbridge International LLC Mitel Networks Overseas Limited
c/o Highbridge Capital Management, LLC c/o Corporate Secretary Limited
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 27th Floor Whitepark House
New York ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇.▇.▇. Barbados
16.1.2 Any party may from time to time by notice to the other party change the
address to which notices are to be given. Any communication shall be
conclusively deemed to have been given on the day of actual delivery
thereof or on the day of actual transmission thereof if such day is a
business day and the communication is delivered or transmitted during the
normal business hours of the recipient and on the business day during
which normal business hours next occur if given after such hours on any
day.
14
GENERAL SECURITY AGREEMENT
16.2 Counterparts: This Guarantee and Security Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all
of which collectively shall constitute one and the same instrument
representing this Guarantee and Security Agreement between the parties
hereto and it shall not be necessary for the proof of this Guarantee and
Security Agreement that any party produce or account for more than one
such counterpart.
16.3 Invalid Provisions: If any provision of this Guarantee and Security
Agreement is held to be illegal or invalid or unenforceable, such
provision shall be fully severable, and this Guarantee and Security
Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a part of this Guarantee and
Security Agreement, and the remaining provisions of this Guarantee and
Security Agreement shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision or by its
severance from this Guarantee and Security Agreement.
16.4 Governing Law: This Guarantee and Security Agreement shall be governed by,
and construed in accordance with, the laws of Barbados and the Courts of
Barbados shall have non-exclusive jurisdiction herein.
15
GENERAL SECURITY AGREEMENT
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first hereinbefore written.
SIGNED by )
and by ) /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
for and on behalf of ) ----------------------------
MITEL NETWORKS OVERSEAS LIMITED ) ▇▇▇▇ ▇▇▇▇▇▇▇, Director
HIGHBRIDGE INTERNATIONAL LLC )
By: Highbridge Capital Management, LLC )
)
)
By: ____________________________________ )
▇▇▇▇ ▇. Chill, Managing Director
16
GENERAL SECURITY AGREEMENT
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first hereinbefore written.
SIGNED by )
and by )
for and on behalf of )
MITEL NETWORKS )
OVERSEAS LIMITED )
in the presence of: ) ______________________________
Witness: ________________________________
Name:
SIGNED by ▇▇▇▇ ▇. Chill, Managing Director )
of Highbridge Capital Management, LLC
for and on behalf of )
HIGHBRIDGE INTERNATIONAL LLC )
in the presence of: ) /s/ ▇▇▇▇ ▇. Chill
-----------------------------
Witness: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
16
COPIES OF SCHEDULE AND EXHIBITS HAVE NOT BEEN PROVIDED AS THE COMPANY HAS
DETERMINED THAT THE INFORMATION CONTAINED THEREIN IS NOT MATERIAL TO INVESTORS.
