Exhibit 10.4
INTELLECTUAL PROPERTY SECURITY AGREEMENT
THIS INTELLECTUAL PROPERTY SECURITY AGREEMENT (this "IP Security
Agreement") is made and entered into as of May 15, 2002 by BLOCK COMMUNICATIONS,
INC., an Ohio corporation (herein referred to as a "Grantor" and the
"Borrower"), and EACH OF THE UNDERSIGNED SUBSIDIARIES OF THE BORROWER AND EACH
OTHER PERSON WHO SHALL BECOME A PARTY HERETO BY EXECUTION OF AN IP SECURITY
JOINDER AGREEMENT (each a "Guarantor" and a "Grantor", and collectively with the
Borrower, the "Grantors"), and BANK OF AMERICA, N.A., a national banking
association, as Administrative Agent (in such capacity, the "Administrative
Agent") for each of the Lenders (as defined in the Credit Agreement (as defined
below), and together with the Administrative Agent, the "Secured Parties") now
or hereafter party to the Credit Agreement. All capitalized terms used but not
otherwise defined herein shall have the respective meanings assigned thereto in
the Credit Agreement.
W I T N E S S E T H:
WHEREAS, pursuant to that certain Credit Agreement dated as of May 15,
2002 by and among the Borrower, the Administrative Agent and the Lenders (as
from time to time amended, revised, modified, supplemented, amended and restated
or replaced, renewed, refunded or refinanced, the "Credit Agreement"), the
Lenders have made available to the Borrower certain term loan facilities and a
revolving credit facility with a letter of credit sublimit and a swing line
facility; and
WHEREAS, as collateral security for payment and performance of the
Borrower's Obligations, the Borrower is willing to grant to the Administrative
Agent for the benefit of the Secured Parties a security interest in the
Collateral (as defined below) pursuant to the terms of this IP Security
Agreement; and
WHEREAS, each Guarantor will materially benefit from the Loans to be made,
and the Letters of Credit to be issued, under the Credit Agreement and each
Guarantor is a party (as signatory hereto or to an IP Security Joinder
Agreement) to a Guaranty pursuant to which each Guarantor guarantees the
Obligations of the Borrower; and
WHEREAS, as collateral security for payment and performance by each
Guarantor of its Guarantor's Obligations (as defined in the Guaranty to which
such Guarantor is a party) and for payment and performance of its obligations
and liabilities (whether now existing or hereafter arising) hereunder or under
any of the other Loan Documents to which it is now or hereafter becomes a party,
each Guarantor is willing to grant to the Administrative Agent for the benefit
of the Secured Parties a security interest in the Collateral pursuant to the
terms of this IP Security Agreement; and
WHEREAS, the Secured Parties are unwilling to enter into the Loan
Documents unless the Borrower and the Guarantors enter into this IP Security
Agreement;
NOW, THEREFORE, in order to induce the Secured Parties to enter into the
Loan Documents and to make Loans and issue Letters of Credit, and in further
consideration of the premises and the mutual covenants contained herein, the
parties hereto agree as follows:
1. GRANT OF SECURITY INTEREST. The Borrower hereby grants as collateral
security for the payment, performance and satisfaction of all of the Borrower's
Obligations, and each Guarantor hereby grants as collateral security for the
payment, performance and satisfaction of all of its Guarantor's Obligations (as
defined in the Guaranty), and each of them hereby grants as collateral security
for the payment and performance of its obligations and liabilities (whether now
existing or hereafter arising) hereunder or under any of the other Loan
Documents to which it is now or hereafter becomes a party (such Borrower's
Obligations, Guarantor's Obligations and all other obligations and liabilities
of the Borrower and the other Grantors referred to collectively as the "Secured
Obligations"), to the Administrative Agent for the benefit of the Secured
Parties a continuing first priority security interest in and to, and
collaterally assigns to the Administrative Agent for the benefit of the Secured
Parties, the following property of such Grantor or in which such Grantor has or
may have or acquire an interest or the power to transfer rights therein, whether
now owned or existing or hereafter created, acquired or arising and wheresoever
located:
(a) all of such Grantor's right, title and interest, whether now
owned or hereafter acquired, in and to all United States and foreign
patents and patent applications (including without limitation the patents
and patent applications identified on Schedule I attached hereto and
incorporated herein by reference) and including the right to recover for
all past, present and future infringements thereof and all reissues,
divisions, continuations, continuations in part, substitutes, renewals,
and extensions thereof, all improvements thereon, and all other rights of
any kind whatsoever of such Grantor accruing thereunder or pertaining
thereto (collectively, the "Patents");
(b) all of such Grantor's right, title and interest, whether now
owned or hereafter acquired, in and to all United States and foreign
trademarks, trade names, domain names, trade dress, service marks,
trademark and service xxxx registrations, and applications for trademark
or service xxxx registration and any renewals thereof (including without
limitation each trademark, trade name, domain name and service xxxx
registration and application identified in Schedule II attached hereto and
incorporated herein by reference) and including all income, royalties,
damages and payments now and hereafter due and/or payable with respect
thereto (including without limitation damages for past or future
infringements thereof), the right to xxx or otherwise recover for all
past, present and future infringements thereof, all rights corresponding
thereto throughout the world (but only such rights as now exist or may
come to exist under applicable local law) and all other rights of any kind
whatsoever of each Grantor accruing thereunder or pertaining thereto,
together in each case with the goodwill of the business connected with the
use of, and symbolized by, each such trademark and service xxxx
(collectively, the "Trademarks");
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(c) all of such Grantor's right, title and interest, whether now
owned or hereafter acquired, in and to all United States and foreign
copyrights and copyright applications (including without limitation the
copyright registrations identified on Schedule III attached hereto and
incorporated herein by reference) and including the right to recover for
all past, present and future infringements thereof and all supplemental
registrations, renewals, and extensions thereof, and all other rights of
any kind whatsoever of such Grantor accruing thereunder or pertaining
thereto (collectively, the "Copyrights"); and
(d) all proceeds of any of the foregoing.
All of the property and interests in property described in clauses (a)
through (d) are herein collectively referred to as the "Collateral." The
security interests granted under this IP Security Agreement are herein referred
to as the "Security Interests."
2. PERFECTION. As of the date of execution of this IP Security Agreement
or an IP Security Joinder Agreement by each Grantor, as applicable (with respect
to each Grantor, its "Applicable Date"), such Grantor shall have furnished the
Administrative Agent with properly executed financing statements in form, number
and substance suitable for filing, sufficient under applicable law, and
satisfactory to the Administrative Agent in order that upon the filing of the
same the Administrative Agent, for the benefit of the Secured Parties, shall
have a duly perfected security interest in all Collateral in which a security
interest can be perfected by the filing of financing statements, subject only to
Liens allowed to exist under Section 7.01 of the Credit Agreement ("Permitted
Liens") with the effect that the Liens conferred in favor of the Administrative
Agent shall be and remain duly perfected and of first priority. All financing
statements (including all amendments thereto and continuations thereof),
certificates, acknowledgments, instruments and other documents furnished in
connection with the creation, enforcement, protection, perfection or priority of
the Administrative Agent's security interest in or collateral assignment of
Collateral, including such items as are described above in this Section 2 or in
Sections 3 and 4 below, are referred to herein as "Perfection Documents." The
delivery of possession of items of or evidencing Collateral, causing other
Persons to execute and deliver Perfection Documents as appropriate, the filing
or recordation of Perfection Documents, the establishment of control over items
of Collateral, and the taking of such other actions as may be necessary or
advisable in the determination of the Administrative Agent to create, enforce,
protect, perfect, or establish or maintain the priority of, the security
interest of or collateral assignment to, the Administrative Agent for the
benefit of the Secured Parties in the Collateral is referred to herein as
"Perfection Action."
3. SECURITY FOR SECURED OBLIGATIONS. The Security Interests granted under
this IP Security Agreement by (a) the Borrower secure the payment, performance
and satisfaction of all of the Secured Obligations now or hereafter owing by the
Borrower and (b) each Guarantor to secure the payment, performance and
satisfaction of all of the Secured Obligations now or hereafter owing by such
Guarantor.
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The Security Interests granted by this IP Security Agreement are granted
in conjunction with the security interests granted to the Administrative Agent,
for the benefit of the Secured Parties, in other assets of each Grantor pursuant
to the other Loan Documents.
4. COLLATERAL ASSIGNMENT. In addition to, and not in limitation of, the
grant of the Security Interests in the Patents, Trademarks and Copyrights in
Section 1 above, each Grantor hereby grants, assigns, transfers, conveys and
sets over to the Administrative Agent, for the benefit of the Secured Parties,
the Grantor's entire right, title and interest in and to the Patents, Trademarks
and Copyrights; provided, that such grant, assignment, transfer, conveyance and
set over shall become effective only at the election of the Administrative Agent
following the occurrence of an Event of Default that is continuing at the time
of such election. Each Grantor hereby agrees that after the effectiveness of
such grant, assignment, transfer, conveyance and set over of any of the Patents,
Trademarks and Copyrights, the use by the Administrative Agent of any of such
Patents, Trademarks and Copyrights shall be without any liability for royalties
or other related charges from the Administrative Agent to any Grantor. In
furtherance of the foregoing, each Grantor has executed in blank and delivered
to the Administrative Agent an assignment of federally registered patents,
trademarks and copyrights (the "IP Assignment") owned by it in the form of
Exhibit A hereto. Each Grantor hereby authorizes the Administrative Agent to
complete as assignee, execute, and record with the United States Patent and
Trademark Office (the "Patent and Trademark Office") and the United States
Copyright Office (the "Copyright Office") and with other applicable state and
federal agencies and authorities, each IP Assignment upon the occurrence of an
Event of Default that is continuing at the time of filing.
5. FURTHER ASSURANCES.
(a) Each Grantor agrees that from time to time, at the expense of
such Grantor, such Grantor will promptly execute and deliver all further
instruments and documents, including such other Perfection Documents and
take all further action and such other or additional Perfection Action, as
may be required by the terms of the Loan Documents or as the
Administrative Agent may reasonably request, in order to (i) continue,
perfect and protect any Security Interest or collateral assignment granted
or purported to be granted hereby, and (ii) enable the Administrative
Agent, for the benefit of the Secured Parties, to exercise and enforce its
rights and remedies hereunder with respect to any part of the Collateral.
Without limiting the generality of the foregoing, each Grantor will
execute and file (with the appropriate governmental offices, authorities,
agencies and regulatory bodies) such joinders or supplements to this IP
Security Agreement and such financing or continuation statements, or
amendments thereto, and such other instruments or notices, including
executed IP Assignments (but the filing of such IP Assignments shall be
effected only in accordance with Section 4 above), with the Patent and
Trademark Office and the Copyright Office, as may be necessary or
desirable, or as the Administrative Agent, on behalf of the Secured
Parties, may reasonably request, in order to perfect and preserve the
Security Interests and collateral assignments granted hereby.
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(b) Each Grantor hereby authorizes the Administrative Agent, on
behalf of the Secured Parties, to file, where permitted by law, 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. A carbon, photographic or other reproduction of this IP
Security Agreement or any financing statement covering the Collateral or
any part thereof shall be sufficient as a financing statement where
permitted by law.
(c) Each Grantor will furnish to the Administrative Agent, on behalf
of the Secured Parties, from time to time statements and schedules further
identifying and describing the Collateral and such other reports in
connection with the Collateral as the Administrative Agent, on behalf of
the Secured Parties, may reasonably request, all in reasonable detail.
(d) Each Grantor agrees to maintain among its books and records
appropriate notations or evidence of, and to make or cause to be made
appropriate disclosure upon its financial statements or, the Security
Interests granted hereunder to the Administrative Agent for the benefit of
the Secured Parties.
(e) Each Grantor agrees that, should it have or obtain an ownership
interest in any material United States patent or patent application that
is not now identified on Schedule I, any material trademark or trademark
application that is not now identified on Schedule II or any material
copyright registration or copyright application that is not now identified
on Schedule III: (i) the provisions of this IP Security Agreement shall
automatically apply to such item, and such item shall automatically become
part of the Collateral; (ii) such Grantor shall, within one month after
acquiring or becoming aware of such ownership interest, (A) give written
notice thereof to the Administrative Agent, (B) take all reasonable and
appropriate steps to protect Patents, Trademarks and Copyrights, as, for
example, by filing applications for their registration with the Patent and
Trademark Office or the Copyright Office, as applicable, and (C) with
respect to Patents, Trademarks and Copyrights, prepare, execute and file
in the Patent and Trademark Office or the Copyright Office, as applicable,
within the requisite time period, all documents that are known by such
Grantor to be necessary or that the Administrative Agent, on behalf of the
Secured Parties, reasonably requests in order to perfect the Security
Interest of the Administrative Agent, on behalf of the Secured Parties,
therein, including delivery to the Administrative Agent of an executed IP
Assignment. Each Grantor authorizes the Administrative Agent, on behalf of
the Secured Parties, to execute and file (subject in the case of the
filing of IP Assignments, to the limitation contained in Section 4 above)
such a document in the name of such Grantor if such Grantor fails to do
so.
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(e) Without limiting Article IIA or Section 6.14 of the Credit
Agreement, each Grantor agrees that should any of its Subsidiaries (other
than a Subsidiary which is a party hereto and whether now or hereafter
existing) obtain any ownership interest in any intellectual property of a
nature that would be Collateral hereunder if owned by such Grantor, such
Grantor shall either cause such Subsidiary (i) to become a party hereto by
executing an IP Security Joinder Agreement and a party to the Guaranty by
executing a Guaranty Joinder Agreement and other Security Instruments in
accordance with Section 6.14 of the Credit Agreement, or (ii) to transfer
and assign, all such Subsidiary's ownership interests therein to such
Grantor, whereupon the provisions of subsection (d) of this Section 5
shall be applicable thereto.
(f) Each Grantor agrees: (i) to take all necessary steps in any
proceeding before the Patent and Trademark Office, the Copyright Office or
any similar office or agency in any other country or any political
subdivision thereof or in any court, to maintain and pursue each patent
application now or hereafter included in the Collateral which the Grantor
determines to be material or otherwise useful to the conduct of its
business, and to maintain each such Patent, and each Trademark or
Copyright now or hereafter included in the Collateral, including the
filing of divisional, continuation, continuation-in-part and substitute
applications, the filing of applications for reissue, renewal or
extensions, the payment of fees, and the participation in interference,
reexamination, opposition and infringement proceedings; (ii) to take
corresponding steps with respect to unpatented inventions which the
Grantor determines to be material or otherwise useful to the conduct of
its business and on which such Grantor is now or hereafter becomes
entitled to seek protection, including maintaining the confidentiality of
such inventions if filing a patent application is not justified in the
reasonable judgment of such Grantor; and (iii) to bear any expenses
incurred in connection with such activities.
(g) No Grantor shall do any act or omit to do any act whereby any of
the Collateral may become dedicated or abandoned, except where such
dedication or abandonment either (i) is of an immaterial portion of the
Collateral, or (ii) is permitted under the Credit Agreement.
(h) Each Grantor agrees that in the event that any of the Collateral
which is material to the operation of its business and as to which it has
granted the Security Interests is infringed or misappropriated by a third
party, such Grantor shall take all reasonable steps to terminate the
infringement or misappropriation, and take such other actions as such
Grantor shall deem appropriate under the circumstances to protect such
Collateral. Any expense incurred in connection with such activities shall
be borne by such Grantor.
6. GENERAL REPRESENTATIONS AND WARRANTIES. Each Grantor represents
and warrants as follows:
(a) It has full power, legal right and lawful authority to enter
into this Security Agreement (and any IP Joinder Security Agreement
applicable to it) and to perform its terms, including the grant of the
Security Interests herein provided for.
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(b) No authorization, consent, approval or other action by, and no
notice to or filing with, any Governmental Authority or other regulatory
body or any other Person is required either (i) for the grant by such
Grantor of the Security Interests granted hereby, or the collateral
assignment hereunder, or for the execution, delivery or performance of
this IP Security Agreement (or any IP Joinder Security Agreement
applicable to it) by such Grantor, or (ii) for the perfection of or the
exercise by the Administrative Agent, on behalf of the Secured Parties, of
its rights and remedies hereunder, except (x) with respect to the Security
Interests, the filing of this IP Security Agreement with the Patent and
Trademark Office and the Copyright Office, as applicable, and the filings
required by the Uniform Commercial Code of the State in which such Grantor
is formed, (y) with respect to the consummation of assignment pursuant to
Section 4 above, the filing in the Patent and Trademark Office or the
Copyright Office, as applicable, of the IP Assignments, and (z) to the
extent that the exercise of rights and remedies may be limited by any
applicable bankruptcy, insolvency, reorganization, moratorium or similar
law affecting creditors rights generally or by general principles of
equity.
(c) No action or proceeding is pending or, to such Grantor's
knowledge, threatened seeking to limit, cancel or question the validity of
any part of the Collateral.
(d) It has not granted any release, covenant not to xxx, or
non-assertion assurance to any third person with respect to any part of
the Collateral.
(e) The actions contemplated under or in connection with the Loan
Documents will not impair the legal right of such Grantor to use any of
the Collateral.
(f) Such Grantor has no knowledge of the existence of any right
under any patent, trademark, license agreement, trade name, trade secret,
know-how, confidential research, development and commercial information,
or other proprietary information held by any other Person that would
materially interfere with the ability of such Grantor to carry on its
business as currently carried on, and such Grantor has no knowledge of any
claim to the contrary that is likely to be made.
(g) None of such Grantor's Domestic Subsidiaries (except to the
extent that such Subsidiaries are also Grantors hereunder or grantors
under any other Security Instrument relating to such property) has an
ownership interest in any patents, patent applications, copyrights,
copyright applications, trademark, trade name, trade dress, service marks,
trademark or service xxxx registrations or any applications for trademark
or service xxxx registration or any other intellectual property of a
nature that would be Collateral hereunder if owned by such Grantor.
(h) No claim has been, and such Grantor has no knowledge of any
claim that is likely to be made, that the use by such Grantor of any
Collateral does or may violate the rights of any Person.
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7. PATENT REPRESENTATIONS AND WARRANTIES. Each Grantor represents
and warrants as follows:
(a) It is the sole, legal and beneficial owner of the entire right,
title and interest in and to the Patents purported to be granted by it
hereunder, free and clear of any Lien, security interest, option, charge,
pledge, registered user agreement, assignment (whether conditional or
not), or covenant, or any other encumbrance, except for non-exclusive
licenses as to which such Grantor is the licensor, Permitted Liens, and
the Security Interests created by this IP Security Agreement. No financing
statement or other instrument similar in effect covering all or any part
of the Patents purported to be granted by such Grantor hereunder is on
file in any recording office, including, without limitation, the Patent
and Trademark Office, except such as may have been filed in favor of the
Administrative Agent, for the benefit of the Secured Parties.
(b) Set forth on Schedule I is a list of all of the Patents owned by
such Grantor and utilized in the conduct of its business as currently
conducted and material in such Grantor's operations or used in the selling
or marketing of such Grantor's products or services.
(c) Each Patent of such Grantor identified on Schedule I hereto is
validly subsisting and has not been adjudged unpatentable, invalid or
unenforceable, in whole or in part, and to the knowledge of such Grantor
is patentable, valid and enforceable, and each of such Patent applications
has been filed in conformity with applicable rules and procedures of the
Patent and Trademark Office and will be prosecuted in conformity therewith
so as not to become improperly abandoned.
8. TRADEMARK REPRESENTATIONS AND WARRANTIES. Each Grantor
represents and warrants as follows:
(d) It is the sole, legal and beneficial owner of the entire right,
title and interest in and to the Trademarks purported to be granted by it
hereunder, free and clear of any Lien, security interest, option, charge,
pledge, registered user agreement, assignment (whether conditional or
not), or covenant, or any other encumbrance, except for non-exclusive
licenses as to which such Grantor is the licensor, Permitted Liens, and
the Security Interests created by this IP Security Agreement. No financing
statement or other instrument similar in effect covering all or any part
of the Trademarks purported to be granted by such Grantor hereunder is on
file in any recording office, including, without limitation, the Patent
and Trademark Office, except such as may have been filed in favor of the
Administrative Agent, for the benefit of the Secured Parties.
(e) Set forth on Schedule II is a list of all of the Trademarks
owned by such Grantor and utilized in the conduct of its business as
currently conducted and material in such Grantor's operations or used in
the selling or marketing of such Grantor's products or services.
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(f) Each Trademark of such Grantor identified on Schedule II, is
validly subsisting and has not been abandoned or adjudged invalid,
unregistrable or unenforceable, in whole or in part, and is, to such
Grantor's knowledge, valid, registrable and enforceable, and each of such
Trademark applications has been filed in conformity with applicable rules
and procedures of the Patent and Trademark Office and will be prosecuted
in conformity therewith so as not to become improperly abandoned.
9. COPYRIGHT REPRESENTATIONS AND WARRANTIES. Each Grantor
represents and warrants as follows:
(g) It is the sole, legal and beneficial owner of the entire right,
title and interest in and to the Copyrights purported to be granted by it
hereunder, free and clear of any Lien, security interest, option, charge,
pledge, registered user agreement, assignment (whether conditional or
not), or covenant, or any other encumbrance, except for the Permitted
Liens, Security Interests created or permitted by this IP Security
Agreement or the Credit Agreement. No financing statement or other
instrument similar in effect covering all or any part of the Copyrights
purported to be granted by such Grantor hereunder is on file in any
recording office, including, without limitation, the Copyright Office,
except such as may have been filed in favor of the Administrative Agent,
for the benefit of the Secured Parties.
(h) Set forth on Schedule III is a list of all of the federally
registered Copyrights owned by such Grantor and utilized in the conduct of
its business as currently conducted and material in such Grantor's
operations or used in the selling or marketing of such Grantor's products
or services.
(i) Each Copyright of such Grantor identified on Schedule III is
validly subsisting and has not been abandoned or adjudged invalid,
unregistrable or unenforceable, in whole or in part, and is, to such
Grantor's knowledge, valid, registrable and enforceable, and each of such
Copyright applications has been filed in conformity with applicable rules
and procedures of the Copyright Office and will be prosecuted in
conformity therewith so as not to become improperly abandoned.
10. TRANSFERS AND OTHER LIENS. No Grantor shall:
(j) sell, assign (by operation of law or otherwise) or otherwise
dispose of any of, or grant any option with respect to, the Collateral,
except as permitted by the Credit Agreement, except that any Grantor may
license the Collateral either on an exclusive or a non-exclusive basis (i)
in the ordinary course of such Grantor's business, provided that such
license is necessary or desirable in the conduct of such Grantor's
business, or (ii) in connection with a sale of assets in compliance with
Section 7.05 of the Credit Agreement. The Administrative Agent, for the
benefit of the Secured Parties, shall execute any documents that such
Grantor may reasonably request in order to permit the Grantor to exercise
its right hereunder to license the Collateral, provided that the
Administrative Agent shall not be required to do anything that may, in the
sole judgment of the Administrative Agent, adversely affect the validity
of the Security Interests;
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(k) create or suffer to exist any Lien, security interest or other
charge or encumbrance upon or with respect to any of the Collateral except
for Permitted Liens or the Security Interests created by this IP Security
Agreement; or
(l) take any other action in connection with any of the Collateral
that would impair the value of the interest or rights of such Grantor in
the Collateral taken as a whole or that would impair the interest or
rights of the Administrative Agent for the benefit of the Secured Parties.
11. ADMINISTRATIVE AGENT APPOINTED ATTORNEY-IN-FACT. Each Grantor hereby
appoints the Administrative Agent as the Grantor's attorney-in-fact for the
purposes of carrying out the provisions of this IP Security Agreement and taking
any action and executing any instrument which the Administrative Agent may deem
necessary or advisable to accomplish the purposes hereof, which appointment is
irrevocable and coupled with an interest; provided, that the Administrative
Agent shall have and may exercise rights under this power of attorney only upon
the occurrence and during the continuance of an Event of Default. Without
limiting the generality of the foregoing, upon the occurrence and during the
continuance of an Event of Default, the Administrative Agent shall have the
right and power
(a) to ask, demand, collect, xxx for, recover, compromise, receive
and give acquittance and receipts for moneys due and to become due under
or in respect of any of the Collateral;
(b) to receive, endorse and collect any drafts or other
instruments, documents and chattel paper in connection with clause (a)
above;
(c) to endorse such Grantor's name on any checks, notes, drafts or
any other payment relating to or constituting proceeds of the Collateral
which comes into the Administrative Agent's possession or the
Administrative Agent's control, and deposit the same to the account of the
Administrative Agent, for the benefit of the Secured Parties, on account
and for payment of the Secured Obligations.
(d) to file any claims or take any action or institute any
proceedings that the Administrative Agent may deem necessary or desirable
for the collection of any of the Collateral or otherwise to enforce the
rights of the Administrative Agent, for the benefit of the Secured
Parties, with respect to any of the Collateral; and
(e) to execute, in connection with any sale or other disposition of
Collateral provided for herein, any endorsement, assignments, or other
instruments of conveyance or transfer with respect thereto.
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12. ADMINISTRATIVE AGENT MAY PERFORM.
(a) If any Grantor fails to perform any agreement contained herein,
the Administrative Agent may itself perform, or cause performance of, such
agreement, and the expenses of the Administrative Agent incurred in
connection therewith shall be payable by such Grantor under Section 16
hereof to the fullest extent permitted by applicable law.
(b) The Administrative Agent or its designated representatives shall
have the right to the extent reasonably requested and upon reasonable
prior written notice, at any reasonable time during normal business hours
of such Grantors and from time to time, to inspect the Grantors' premises
and to examine the Grantors' books, records and operations relating to the
Collateral.
13. THE ADMINISTRATIVE AGENT'S DUTIES.
(a) Except for the exercise of reasonable care in the custody and
preservation of any Collateral in its possession and accounting for monies
received by it pursuant to this Security Agreement, the Administrative
Agent shall be under no duty or liability with respect to the collection,
protection or preservation of the Collateral.
(b) Each Grantor agrees to pay when due all taxes, charges, Liens
and assessments against the Collateral in which it has an interest, unless
being contested in good faith by appropriate proceedings diligently
conducted and against which adequate reserves have been established in
accordance with GAAP and evidenced to the satisfaction of the
Administrative Agent and provided that all enforcement proceedings in the
nature of levy or foreclosure are effectively stayed. Upon the failure of
any Grantor to so pay or contest such taxes, charges, Liens or
assessments, or upon the failure of any Grantor to pay any amount pursuant
to this IP Security Agreement, the Administrative Agent at its option may
pay or contest any of them (the Administrative Agent having the sole right
to determine the legality or validity and the amount necessary to
discharge such taxes, charges, Liens or assessments) but shall not have
any obligation to make any such payment or contest. All sums so disbursed
by the Administrative Agent, including reasonable Attorneys' Costs, court
costs, expenses and other charges related thereto, shall be payable on
demand by the applicable Grantor to the Administrative Agent and shall be
additional Secured Obligations secured by the Collateral, and any amounts
not so paid on demand (in addition to other rights and remedies resulting
from such nonpayment) shall bear interest from the date of demand until
paid in full at the Default Rate.
(c) Each Grantor hereby irrevocably authorizes the Administrative
Agent to file (with, or to the extent permitted by applicable law, without
the signature of the Grantor appearing thereon) financing statements
(including amendments thereto and continuations and copies thereof)
showing such Grantor as "debtor" at such time or times and in all filing
offices as the Administrative Agent may from time to time determine to be
necessary or advisable to perfect or protect the rights of the
Administrative Agent and
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the Secured Parties hereunder, or otherwise to give effect to the
transactions herein contemplated.
14. REINSTATEMENT. The granting of a security interest in the Collateral
and the other provisions hereof shall continue to be effective or be reinstated,
as the case may be, if at any time any payment of any of the Secured Obligations
is rescinded or must otherwise be returned by any Secured Party or is repaid by
any Secured Party in whole or in part in good faith settlement of a pending or
threatened avoidance claim, whether upon the insolvency, bankruptcy or
reorganization of any Grantor or any other Loan Party or otherwise, all as
though such payment had not been made. The provisions of this Section 14 shall
survive repayment of all of the Secured Obligations, the termination of the
Aggregate Commitments and the termination or expiration of this IP Security
Agreement in any manner, including but not limited to termination upon
occurrence of the Facility Termination Date (as defined in Section 29 hereof).
15. REMEDIES UPON AN EVENT OF DEFAULT. If an Event of Default shall
have occurred and be continuing:
(a) The Administrative Agent, for the benefit of the Secured
Parties, may exercise in respect of the Collateral of any defaulting
Grantor, in addition to other rights and remedies provided for herein or
otherwise available to it, all the rights and remedies of a secured party
upon default under the Uniform Commercial Code as in effect in the State
of New York (the "UCC") and also may (i) exercise any and all rights and
remedies of such Grantor under, in connection with, or otherwise in
respect of, such Collateral, including the completion and filing of the IP
Assignment, (ii) require such Grantor to, and each Grantor hereby agrees
that it will at its expense and upon request of the Administrative Agent
forthwith, assemble all or part of the documents embodying such Collateral
as directed by the Administrative Agent and make it available to the
Administrative Agent, for the benefit of the Secured Parties, at a place
to be designated by the Administrative Agent that is reasonably convenient
to both the Administrative Agent and such Grantor, (iii) occupy any
premises owned or leased by such Grantor where documents embodying such
Collateral or any part thereof are assembled for a reasonable period in
order to effectuate the Administrative Agent's rights and remedies
hereunder or under applicable law, without obligation to such Grantor in
respect of such occupation, (iv) license such Collateral or any part
thereof, and (v) without notice except as specified below, sell such
Collateral or any part thereof at public or private sale, at any of the
Administrative Agent's offices or elsewhere, for cash, on credit or for
future delivery, and upon such other terms as the Administrative Agent may
deem commercially reasonable. Each Grantor agrees that at least ten days'
notice to such Grantor of the time and place of any public sale or the
time after which any private sale is to be made shall constitute
reasonable notification. The Administrative Agent shall not be obligated
to make any sale of the Collateral regardless of notice of sale having
been given. The Administrative Agent may adjourn any public or private
sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time
and place to which it was so adjourned.
12
(b) All payments received by any defaulting Grantor under or in
connection with any of such Collateral shall be received in trust for the
benefit of the Secured Parties, shall be segregated from other funds of
such Grantor and shall be immediately paid over to the Administrative
Agent, for the benefit of the Secured Parties, in the same form as so
received (with any necessary endorsement).
(c) The net cash proceeds resulting from the collection,
liquidation, sale, or other disposition of the Collateral of any
defaulting Grantor shall be applied first to the expenses (including all
Attorneys' Costs) owing pursuant to Section 16 hereof, of retaking,
holding, storing, processing and preparing for sale, selling, collecting,
liquidating and the like, and then to the satisfaction of all Secured
Obligations in accordance with the terms of Section 2.14 of the Credit
Agreement. Each Grantor shall be liable to the Administrative Agent, for
the benefit of the Secured Parties, and shall pay to the Administrative
Agent, for the benefit of the Secured Parties, on demand any deficiency
which may remain after such sale, disposition, collection or liquidation
of the Collateral.
The Administrative Agent shall provide prompt notice to the Borrower of
its exercise of remedies under this Section 15, provided that such notice may be
general in nature and neither the failure to give, nor any delay in giving, such
notice shall have any effect on the validity or effectiveness of any action
taken hereunder.
16. EXPENSES. Each Grantor will upon demand pay to the Administrative
Agent the amount of any and all reasonable expenses, including Attorneys' Costs
and the reasonable fees and disbursements of any experts and agents, that the
Administrative Agent, for the benefit of the Secured Parties, may incur in
connection with (i) the administration of this IP Security Agreement, (ii) the
custody, preservation, use or operation of, or the sale of, collection from or
other realization upon, any of the Collateral, (iii) the exercise or enforcement
of any of the rights of the Secured Parties, or (iv) the failure by any Grantor
to perform or observe any of the provisions hereof.
17. WAIVER. Each Grantor waives to the extent permitted by applicable law
(a) any right to require any Secured Party or any other obligee of the Secured
Obligations to (x) proceed against any Person or entity, including without
limitation any Loan Party, (y) proceed against or exhaust any Collateral or
other collateral for the Secured Obligations, or (z) pursue any other remedy in
its power; (b) any defense arising by reason of any disability or other defense
of any other Person, or by reason of the cessation from any cause whatsoever of
the liability of any other Person or entity, (c) any right of subrogation, (d)
any right to enforce any remedy which any Secured Party or any other obligee of
the Secured Obligations now has or may hereafter have against any other person
and any benefit of and any right to participate in any collateral or security
whatsoever now or hereafter held by the Administrative Agent for the benefit of
the Secured Parties. Each Grantor authorizes each Secured Party and each other
obligee of the Secured Obligations without notice (except notice required by
applicable law) or demand and without affecting its liability hereunder or under
the Loan Documents from time to time to: (i) take and hold security, other than
the Collateral herein described, for the payment of such Secured Obligations or
any part thereof, and exchange, enforce, waive and release the Collateral
13
herein described or any part thereof or any such other security; and (ii) apply
such Collateral or other security and direct the order or manner of sale thereof
as such Secured Party or obligee in its discretion may determine.
18. AMENDMENTS. No amendment, modification, or termination or waiver of
any provision of this IP Security Agreement nor consent to any departure by any
Grantor therefrom shall in any event be effective unless effected in accordance
with Section 10.01 of the Credit Agreement, then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.
19. CONTINUING SECURITY INTEREST; ASSIGNMENTS UNDER THE CREDIT
AGREEMENT
(a) This IP Security Agreement shall create a continuing Security
Interest in the Collateral and shall remain in full force and effect until
terminated in accordance with the provisions of Section 29 hereof.
(b) Except as permitted by this IP Security Agreement or the Credit
Agreement, no Grantor shall sell, lease, transfer or otherwise dispose of
any item of Collateral during the term of this IP Security Agreement
without the prior written consent of the Required Lenders to such sale,
lease, transfer or other disposition.
(c) Upon the termination of this IP Security Agreement in accordance
with Section 29 hereof, the Collateral shall be automatically released
from the Liens created hereby, all rights to the Collateral shall
automatically revert to the Grantors, and this IP Security Agreement and
all obligations of the Grantors hereunder shall terminate without delivery
of any instrument or performance of any act by any party. Upon such
termination of this IP Security Agreement, the Administrative Agent shall
reassign and redeliver such Collateral then held by or for the Secured
Parties and execute and deliver to each Grantor such documents as it shall
reasonably request to evidence such termination.
20. ADDITIONAL COLLATERAL. If any Grantor shall acquire or hold any
additional material Patents, Trademarks or Copyrights not listed on Schedules I,
II, or III hereto (any such Patents, Trademarks or Copyrights being referred to
herein as the "Additional Collateral"), such Grantor shall promptly deliver to
the Administrative Agent for the benefit of the Secured Parties a revised
Schedule I, II, or III hereto, as applicable, reflecting the ownership and
pledge of such Additional Collateral. Each Grantor shall comply with the
requirements of this Section 20 and Section 5 hereof concurrently with the
acquisition of any such Additional Collateral.
21. JOINDER. Each Person who shall at any time execute and deliver to the
Administrative Agent an IP Security Joinder Agreement substantially in the form
attached as Exhibit A hereto shall thereupon irrevocably, absolutely and
unconditionally become a party hereto and obligated hereunder as a Grantor and
shall have thereupon pursuant to Section 1 hereof granted a security interest in
and collaterally assigned to the Administrative Agent for the benefit of the
Secured Parties all Collateral in which it has at its Applicable Date or
thereafter acquires any interest or the power to transfer, and all references
herein and in the other Loan
14
Documents to the Grantors or to the parties to this IP Security Agreement shall
be deemed to include such Person as a Grantor hereunder. Each IP Security
Joinder Agreement shall be accompanied by the Supplemental Schedules referred to
therein, appropriately completed with information relating to the Grantor
executing such IP Security Joinder Agreement and its property. Each of the
applicable Schedules attached hereto shall be deemed amended and supplemented
without further action by such information reflected on the Supplemental
Schedules.
22. DEFINITIONS. All terms used herein unless otherwise defined herein
shall be defined in accordance with the appropriate definitions appearing in the
Uniform Commercial Code in effect in New York, and such definitions are hereby
incorporated herein by reference and made a part hereof.
23. ENTIRE AGREEMENT. This IP Security Agreement and each IP Security
Joinder Agreement, together with the Credit Agreement and the other Loan
Documents, constitutes and expresses the entire understanding between the
parties hereto with respect to the subject matter hereof, and supersedes all
prior agreements and understandings, inducements, commitments or conditions,
express or implied, oral or written, except as contained in the Loan Documents.
The express terms hereof and of the IP Security Joinder Agreements control and
supersede any course of performance or usage of the trade inconsistent with any
of the terms hereof or thereof. Neither this IP Security Agreement or any IP
Security Joinder Agreement nor any portion or provision hereof or thereof may be
changed, altered, modified, supplemented, discharged, canceled, terminated, or
amended orally or in any manner other than as provided in the Credit Agreement.
24. EVIDENCE OF LIEN. Each Grantor hereby consents and agrees that the
issuers of or obligors in respect of the Collateral shall be entitled to accept
the provisions hereof and of the IP Security Joinder Agreements as conclusive
evidence of the right of the Administrative Agent, on behalf of the Secured
Parties, to exercise its rights hereunder or thereunder with respect to the
Collateral, notwithstanding any other notice or direction to the contrary
heretofore or hereafter given by any Grantor or any other Person to any of such
issuers or obligors.
25. BINDING AGREEMENT; ASSIGNMENT. This IP Security Agreement and each IP
Security Joinder Agreement, and the terms, covenants, conditions, rights and
remedies hereof, shall be binding upon and inure to the benefit of the parties
hereto, and to their respective successors and assigns; provided, however, that
no Grantor shall be permitted to assign this IP Security Agreement, any IP
Security Joinder Agreement or any interest herein or therein or in the
Collateral. Without limiting the generality of the foregoing sentence of this
Section 25, any Lender may assign to one or more Persons, or grant to one or
more Persons participations in or to, all or any part of its rights and
obligations under the Credit Agreement (to the extent permitted by the Credit
Agreement); and to the extent of any such assignment or participation such other
Person shall, to the fullest extent permitted by law, thereupon become vested
with all the benefits in respect thereof granted to such Lender herein or
otherwise, subject however, to the provisions of the Credit Agreement, including
Article IX thereof (concerning the Administrative Agent) and Section 10.7
thereof (concerning assignments and participations.) All references herein to
the Administrative Agent and to the Secured Parties shall include any
15
successor thereof or permitted assignee, and any other obligees from time to
time of the Secured Obligations.
26. RELATED SWAP CONTRACTS. All obligations of each Grantor under or in
respect of Related Swap Contracts (which are not prohibited under the terms of
the Credit Agreement) to which any Lender or any Affiliate of any Lender is a
party, shall be deemed to be Secured Obligations secured hereby, and each Lender
or Affiliate of a Lender party to any such Related Swap Contract shall be deemed
to be a Secured Party hereunder with respect to such Secured Obligations;
provided, however, that such obligations shall cease to be Secured Obligations
at such time as such Person (or Affiliate of such Person) shall cease to be a
"Lender" under the Credit Agreement.
No Person who obtains the benefit of any Lien by virtue of the provisions
of this Section shall have any right to notice of any action or to consent to,
direct or object to any action hereunder or under any other Loan Document or
otherwise in respect of the Collateral (including the release or impairment of
any Collateral) other than in its capacity as a Lender and only to the extent
expressly provided in the Loan Documents.
27. SEVERABILITY. The provisions of this IP Security Agreement are
independent of and separable from each other. If any provision hereof shall for
any reason be held invalid or unenforceable, such invalidity or unenforceability
shall not affect the validity or enforceability of any other provision hereof,
but this IP Security Agreement shall be construed as if such invalid or
unenforceable provision had never been contained herein.
28. COUNTERPARTS. This IP Security Agreement may be executed in any number
of counterparts each of which when so executed and delivered shall be deemed an
original, and all of which together shall constitute one and the same
instrument, and it shall not be necessary in making proof of this IP Security
Agreement to produce or account for more than one such counterpart executed by
the Grantor against whom enforcement is sought. Without limiting the foregoing
provisions of this Section 28, the provisions of Section 10.02(b) of the Credit
Agreement shall be applicable to this IP Security Agreement.
29. TERMINATION.
(a) Subject to the provisions of Section 14, this IP Security Agreement
and each IP Security Joinder Agreement, and all obligations of the Grantors
hereunder (excluding those obligations and liabilities that expressly survive
such termination) shall terminate without delivery of any instrument or
performance of any act by any party on the Facility Termination Date. For
purposes of this IP Security Agreement, "Facility Termination Date" means the
date as of which all of the following shall have occurred: (a) the Borrower
shall have permanently terminated the credit facilities under the Loan Documents
by final payment in full of all Outstanding Amounts, together with all accrued
and unpaid interest and fees thereon, other than (i) the undrawn portion of
Letters of Credit and (ii) all letter of credit fees relating thereto accruing
after such date (which fees shall be payable solely for the account of the
Issuing Bank and shall be computed (based on interest rates then in effect) on
such undrawn amounts to the respective expiry dates of the Letters of Credit),
in each case as have been fully Cash
16
Collateralized or as to which other arrangements with respect thereto
satisfactory to the Administrative Agent and the L/C Issuer shall have been
made; (b) all Related Swap Contracts shall have been terminated, expired or Cash
Collateralized; (c) all Aggregate Commitments shall have terminated or expired;
and (d) the Borrower shall have fully, finally and irrevocably paid and
satisfied in full all other Obligations (except for Obligations consisting of
continuing indemnities and other contingent Obligations of the Borrower or any
Loan Party that may be owing to any Agent-Related Person or any Lender pursuant
to the Loan Documents and expressly survive termination of this IP Security
Agreement). Upon such termination of this IP Security Agreement, the
Administrative Agent shall, at the request and sole expense of the Grantors,
promptly deliver to the Grantors such termination statements and take such
further actions as the Grantors may reasonably request to terminate of record,
or otherwise to give appropriate notice of the termination of, any Lien
conferred hereunder.
(b) In the event that all of the Subsidiary Securities issued by any
Grantor are Disposed of by the Borrower and/or any Grantor, and such Disposition
is expressly permitted by the Credit Agreement, then all obligations of such
disposed Grantor hereunder (excluding those obligations and liabilities that
expressly survive such termination) shall terminate without delivery of any
instrument or performance of any act by any party, and the Administrative Agent
shall, at the request and sole expense of the Grantors, promptly deliver to the
Grantors such termination statements and take such further actions as the
Grantors may reasonably request to terminate of record, or otherwise to give
appropriate notice of the termination of, any Lien conferred hereunder.
30. NOTICES. Any notice required or permitted hereunder shall be given (a)
with respect to the Borrower, at the address for the giving of notice then in
effect under the Credit Agreement, (b) with respect to any Grantor, at the
address then in effect for the giving of notices to such Grantor under the
Guaranty to which it is a party, and (c) with respect to the Administrative
Agent or a Lender, at the Administrative Agent's address for the giving of
notice then in effect under the Credit Agreement. All such addresses may be
modified, and all such notices shall be given and shall be effective, as
provided in Section 10.02 of the Credit Agreement for the giving and
effectiveness of notices and modifications of addresses thereunder
31. RULES OF INTERPRETATION. The rules of interpretation contained in
Sections 1.02 and 1.05 of the Credit Agreement shall be applicable to this IP
Security Agreement and each IP Security Joinder Agreement and are hereby
incorporated by reference All representations and warranties contained herein
shall survive the delivery of documents and any Credit Extensions referred to
herein or secured hereby.
32. RELEASE. Upon the Disposition of any item of Collateral, so long
as such Disposition is permitted under Section 7.05 of the Credit Agreement
and all conditions to such Disposition contained therein have been satisfied:
(a) the Lien of the Administrative Agent for the benefit of the
Secured Parties in such disposed Collateral shall, subject to the
provision at the end of this subsection (a), be deemed to be released
without any further action on the part of the Administrative Agent or the
relevant Grantor, provided that in the event following any such
Disposition
17
any Grantor shall thereafter acquire any interest in (or the power to
transfer rights in) any asset that constituted Collateral hereunder prior
to its Disposition and release from the security interests hereunder, the
pledge, assignment and security interest granted hereunder shall be deemed
to automatically apply and attach to such asset and it shall from such
time forward continue to constitute Collateral hereunder notwithstanding
any prior release; and
(b) the Administrative Agent will (other than in connection with
sales of Inventory in the ordinary course of business), at the Grantors'
expense, execute and deliver to each Grantor such documents as such
Grantor shall reasonably request on reasonable advance notice to evidence
the release of such item of Collateral from the pledge, assignment and
security interest granted hereunder, provided that such Grantor shall have
delivered to the Collateral Agent a written request for release describing
the item of Collateral and the terms of the Disposition thereof in
reasonable detail, including the price thereof and any expenses in
connection therewith.
33. GOVERNING LAW; WAIVERS.
(a) THIS IP SECURITY AGREEMENT AND EACH IP SECURITY JOINDER
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY
PERFORMED, IN SUCH STATE (i) WITH RESPECT TO THOSE INSTANCES IN WHICH THE
APPLICABLE CHOICE OF LAWS RULES OF SUCH STATE, INCLUDING SECTION 9-301 OF
THE UCC, REQUIRE THAT THE MANNER OF CREATION OF A SECURITY INTEREST IN
SPECIFIC COLLATERAL OR THE MANNER OR EFFECT OF PERFECTION OR NONPERFECTION
OR THE RULES GOVERNING PRIORITY OR SECURITY INTERESTS ARE TO BE GOVERNED
BY THE LAWS OF ANOTHER JURISDICTION, THEN THE LAWS OF SUCH OTHER
JURISDICTION SHALL GOVERN SUCH MATTERS, AND (ii) IN THOSE INSTANCES IN
WHICH THE LAWS OF THE JURISDICTION IN WHICH COLLATERAL IS LOCATED GOVERN
MATTERS PERTAINING TO THE METHODS AND EFFECT OF REALIZING ON COLLATERAL,
SUCH LAWS SHALL BE GIVEN EFFECT WITH RESPECT TO SUCH MATTERS.
EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND CONSENTS
THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS IP
SECURITY AGREEMENT OR ANY IP SECURITY JOINDER AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREIN OR THEREIN MAY BE INSTITUTED IN ANY STATE
OR FEDERAL COURT SITTING IN THE XXXXXX XX XXX XXXX, XXXXX XX XXX XXXX,
XXXXXX XXXXXX OF AMERICA AND, BY THE EXECUTION AND DELIVERY OF THIS IP
SECURITY AGREEMENT OR AN IP SECURITY JOINDER AGREEMENT, EXPRESSLY WAIVES
ANY OBJECTION THAT IT MAY HAVE NOW OR HEREAFTER TO THE LAYING
18
OF THE VENUE OR TO THE JURISDICTION OF ANY SUCH SUIT, ACTION OR
PROCEEDING, AND IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO THE
JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.
(c) EACH GRANTOR AGREES THAT SERVICE OF PROCESS MAY BE MADE BY
PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL
PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED OR
CERTIFIED MAIL (POSTAGE PREPAID) TO THE ADDRESS OF SUCH PARTY PROVIDED IN
SECTION 30 OR BY ANY OTHER METHOD OF SERVICE PROVIDED FOR UNDER THE
APPLICABLE LAWS IN EFFECT IN THE STATE OF NEW YORK.
(d) NOTHING CONTAINED IN SUBSECTIONS (b) OR (c) HEREOF SHALL
PRECLUDE THE ADMINISTRATIVE AGENT FROM BRINGING ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS IP SECURITY AGREEMENT OR ANY
IP SECURITY JOINDER AGREEMENT OR THE OTHER LOAN DOCUMENTS IN THE COURTS OF
ANY PLACE WHERE ANY OTHER PARTY OR ANY OF SUCH PARTY'S PROPERTY OR ASSETS
MAY BE FOUND OR LOCATED. TO THE EXTENT PERMITTED BY THE APPLICABLE LAWS OF
ANY SUCH JURISDICTION, EACH GRANTOR HEREBY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF ANY SUCH COURT AND EXPRESSLY WAIVES, IN RESPECT OF ANY
SUCH SUIT, ACTION OR PROCEEDING, THE JURISDICTION OF ANY OTHER COURT OR
COURTS WHICH NOW OR HEREAFTER, BY REASON OF ITS PRESENT OR FUTURE
DOMICILE, OR OTHERWISE, MAY BE AVAILABLE UNDER APPLICABLE LAW.
(e) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR
REMEDIES UNDER OR RELATED TO THIS IP SECURITY AGREEMENT OR ANY IP SECURITY
JOINDER AGREEMENT OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT
DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN CONNECTION WITH THE
FOREGOING, EACH PARTY HEREBY AGREES, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND
NOT BEFORE A JURY AND HEREBY EXPRESSLY WAIVES, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT SUCH PERSON MAY HAVE TO TRIAL BY JURY IN ANY
SUCH ACTION, SUIT OR PROCEEDING.
(f) EACH GRANTOR HEREBY EXPRESSLY WAIVES ANY OBJECTION IT MAY HAVE
THAT ANY COURT TO WHOSE JURISDICTION IT HAS SUBMITTED PURSUANT TO THE
TERMS HEREOF IS AN INCONVENIENT FORUM.
19
IN WITNESS WHEREOF, the parties have duly executed this Intellectual
Property Security Agreement on the day and year first written above.
GRANTORS:
BLOCK COMMUNICATIONS, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Managing Director
-------------------------------------------
BUCKEYE CABLEVISION, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Chairman
-------------------------------------------
ERIE COUNTY CABLEVISION, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Chairman
-------------------------------------------
BUCKEYE TELESYSTEMS, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Chairman
-------------------------------------------
CORPORATE PROTECTION SERVICES, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Chairman
-------------------------------------------
COMMUNITY COMMUNICATION SERVICES, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Vice President
-------------------------------------------
PG PUBLISHING COMPANY
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Vice President
-------------------------------------------
MONROE CABLEVISION, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Chairman
-------------------------------------------
LIMA COMMUNICATIONS CORPORATION
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Chairman
-------------------------------------------
WLFI-TV, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: President
-------------------------------------------
INDEPENDENCE TELEVISION COMPANY
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Chairman
-------------------------------------------
Intellectual Property Security Agreement
Signature Page 2
TOLEDO AREA TELECOMMUNICATIONS SERVICES, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Vice President
-------------------------------------------
METRO FIBER & CABLE CONSTRUCTION COMPANY
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Vice President
-------------------------------------------
IDAHO INDEPENDENT TELEVISION, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Chairman
-------------------------------------------
CARS HOLDING, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: President
-------------------------------------------
ACCESS TOLEDO, LTD.
By: BLOCK COMMUNICATIONS, INC.
By: /s/ Xxxxx X. Block
-------------------------------------------
Name: Xxxxx X. Block
-------------------------------------------
Title: Vice President
-------------------------------------------
Intellectual Property Security Agreement
Signature Page 3
ADMINISTRATIVE AGENT:
BANK OF AMERICA, N.A.,
as Administrative Agent for the Lenders
By: /s/ Xxxxxxx X. Xxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxx
-------------------------------------------
Title: Principal
-------------------------------------------
Intellectual Property Security Agreement
Signature Page 4
EXHIBIT A
ASSIGNMENT OF PATENTS, TRADEMARKS AND COPYRIGHTS
THIS ASSIGNMENT OF PATENTS, TRADEMARKS AND COPYRIGHTS (this "Agreement")
is made as of ______________ ___, 20__ by BLOCK COMMUNICATIONS, INC., an Ohio
corporation (herein referred to as the "Borrower" and a "Grantor"), and EACH OF
THE UNDERSIGNED SUBSIDIARIES OF THE BORROWER (each a "Guarantor" and a
"Grantor," and collectively with the Borrower, the "Grantors") in favor of BANK
OF AMERICA, N.A., as Administrative Agent (in such capacity, the "Administrative
Agent") for each of the Lenders (as defined in the Credit Agreement (as defined
below)) (the "Secured Parties"). All capitalized terms used but not otherwise
defined herein shall have the respective meanings assigned thereto in the Credit
Agreement.
W I T N E S S E T H:
WHEREAS, pursuant to that certain Credit Agreement dated as of May 15,
2002 by and among the Borrower, the Administrative Agent and the Lenders (as
from time to time amended, revised, modified, supplemented, amended and
restated, or replaced, renewed, refunded or refinanced, the "Credit Agreement"),
the Lenders have made available to the Borrower certain term loan facilities and
a revolving credit facility with a letter of credit sublimit and a swing line
facility sublimit; and
WHEREAS, the Borrower and each Guarantor will materially benefit from the
Loans to be made, and the Letters of Credit to be issued, under the Credit
Agreement and each Guarantor is a party to a Guaranty pursuant to which each
Guarantor guarantees the Obligations of the Borrower; and
WHEREAS, each Grantor has entered into that certain Intellectual Property
Security Agreement (by joinder or otherwise) (the "IP Security Agreement") dated
as of May 15, 2002 pursuant to which each Grantor has granted to the
Administrative Agent for the benefit of the Secured Parties a security interest
in the Trademarks, Copyrights, and Patents defined below in order to secure the
Secured Obligations (as defined in the IP Security Agreement).
WHEREAS, each Grantor (a) has adopted, registered and used and is using
the trademarks and service marks (the "Trademarks") identified on Annex I
hereto, and is the owner of the registrations of and pending registration
applications for such Trademarks in the United States Patent and Trademark
Office identified on Annex I hereto, (b) is the owner of and uses the copyright
registrations set forth on Annex II hereto (the "Copyrights"), and (c) is the
owner of and uses the patents, patent registrations and pending registration
applications set forth on Annex III hereto (the "Patents" and together with the
Trademarks and the Copyrights, the "Collateral"); and
WHEREAS, the Administrative Agent for the benefit of the Secured Parties
desires to acquire the Trademarks, the Copyrights, and the Patents and the
registrations thereof and applications therefor, as applicable, in connection
with the exercise of its remedies after the occurrence of an Event of Default
and pursuant to the terms of the IP Security Agreement;
NOW, THEREFORE, for good and valuable consideration, receipt of which is
hereby acknowledged, each Grantor does hereby assign, sell and transfer unto the
Administrative Agent all right, title and interest in and to the Trademarks,
Copyrights, and Patents, together with (i) the registrations of and applications
therefor, as applicable, (ii) all reissues, divisions, continuations,
continuations in part, substitutes, renewals, and extensions thereof, all
improvements thereon, and all other rights of any kind whatsoever of such
Grantor accruing thereunder or pertaining thereto, (iii) the goodwill of the
business symbolized by and associated with the Trademarks and the registrations
thereof, and (iv) the right to xxx and recover for, and the right to profits or
damages due or accrued arising out of or in connection with, any and all past,
present or future infringements or dilution of or damage or injury to the
Trademarks, Copyrights, Patents or the registrations thereof or such associated
goodwill.
Each Grantor hereby grants to the Administrative Agent, for the benefit of
the Secured Parties, and notice is hereby given that each Grantor has granted to
the Administrative Agent, for the benefit of the Secured Parties, a first
priority security interest in the Collateral to secure the payment and
performance in full of all Secured Obligations (as defined in the IP Security
Agreement) and all obligations of each Grantor under its respective Guaranty (if
applicable) and any other Loan Documents to which it is a party.
This Agreement is intended to and shall take effect as a sealed instrument
at such time as the Administrative Agent shall complete this instrument by
signing its acceptance of this IP Security Agreement below.
[SIGNATURE PAGES FOLLOW.]
A-2
IN WITNESS WHEREOF, the parties have duly executed this Assignment of
Patents, Trademarks and Copyrights on the day and year first written above.
GRANTORS:
By: /s/ Xxxxx X. Block
----------------------------------------
Xxxxx X. Block
As Managing Director of:
Block Communications, Inc.
As Chairman of:
Buckeye Cablevision, Inc.
Buckeye Telesystems, Inc.
Corporate Protection Services, Inc.
Erie County Cablevision, Inc.
Idaho Independent Television, Inc.
Independence Television Company
Lima Communications Corporation
Monroe Cablevision, Inc.
As President of:
CARS Holding, Inc.
WLFI-TV, Inc.
As Vice President of:
Community Communications Services, Inc.
Metro Fiber & Cable Construction Company
PG Publishing Company
Toledo Area Telecommunications Services, Inc.
Access Toledo, Ltd.
The foregoing Assignment of the Patents, Trademarks and Copyrights and the
registrations thereof and registration applications therefor by the Grantors is
hereby accepted as of the --- day of ------------, 20--.
BANK OF AMERICA, N.A., as Administrative Agent
By: /s/ Xxxxxxx X. Xxxx
----------------------------------------
Name: Xxxxxxx X. Xxxx
----------------------------------------
Title: Principal
----------------------------------------
A-3
EXHIBIT B
FORM OF IP SECURITY JOINDER AGREEMENT
THIS INTELLECTUAL PROPERTY SECURITY JOINDER AGREEMENT (this "IP Security
Joinder Agreement"), dated as of ______________, 2___ is made by and between
___________________________, _____________________________ (the "Joining
Grantor"), and BANK OF AMERICA, N.A., in its capacity as Administrative Agent
(in such capacity, the "Administrative Agent"), under that certain Credit
Agreement (as from time to time amended, revised, modified, supplemented,
amended and restated, or replaced, renewed, refunded or refinanced, the "Credit
Agreement"), dated as of May 15, 2002, by and among Block Communications, Inc.
(the "Borrower"), the Lenders (as defined in the Credit Agreement) party thereto
and the Administrative Agent. All capitalized terms not otherwise defined herein
shall have the meanings given to such terms in the Credit Agreement or the IP
Security Agreement, as applicable.
WHEREAS, the Joining Grantor is a Subsidiary and required by the terms of
the Credit Agreement to become a "Guarantor" under the Credit Agreement and be
joined as a party to the IP Security Agreement as a Grantor (as defined in the
IP Security Agreement); and
WHEREAS, the Joining Grantor will materially benefit directly and
indirectly from the credit facilities made available and to be made available to
the Borrower by the Lenders under the Credit Agreement; and
NOW, THEREFORE, the Joining Grantor hereby agrees as follows with the
Administrative Agent, for the benefit of the Secured Parties (as defined in the
IP Security Agreement):
1. JOINDER. The Joining Grantor hereby irrevocably, absolutely and
unconditionally becomes a party to the IP Security Agreement as a Grantor and is
bound by all the terms, conditions, obligations, liabilities, covenants and
undertakings of each Grantor or to which each Grantor is subject thereunder,
including without limitation the grant pursuant to Section 1 of the IP Security
Agreement of a Security Interest to the Administrative Agent for the benefit of
the Secured Parties in the property and property rights constituting Collateral
(as defined in Section 1 of the IP Security Agreement) of such Grantor or in
which such Grantor has or may have or acquire an interest or the power to
transfer rights therein, whether now owned or existing or hereafter created,
acquired or arising and wheresoever located, and the collateral assignment of
the Collateral pursuant to Section 4 of the IP Security Agreement, all as
security for the payment and performance of the Secured Obligations (as defined
in the IP Security Agreement), all with the same force and effect as if the
Joining Grantor were a signatory to the IP Security Agreement.
2. AFFIRMATIONS. The Joining Grantor hereby acknowledges and
reaffirms as of the date hereof with respect to itself, its properties and
its affairs each of the waivers,
representations, warranties, acknowledgements and certifications applicable to
any Grantor contained in the IP Security Agreement.
3. SUPPLEMENTAL SCHEDULES. Attached to this IP Security Joinder Agreement
are duly completed schedules (the "Supplemental Schedules") supplementing as
thereon indicated the respective Schedules to the IP Security Agreement. The
Joining Grantor represents and warrants that the information contained on each
of the Supplemental Schedules with respect to such Joining Grantor and its
Collateral, properties and affairs is true, complete and accurate as of the date
hereof.
4. IP ASSIGNMENT. Attached to this IP Security Joinder agreement is a duly
executed IP Assignment in which the Joining Grantor grants, assigns, transfers,
conveys and sets over the Administrative Agent, for the benefit of the Secured
Parties, the Grantor's entire right, title and interest in and to the Collateral
described in the Supplemental Schedules.
5. SEVERABILITY. The provisions of this IP Security Joinder Agreement are
independent of and separable from each other. If any provision hereof shall for
any reason be held invalid or unenforceable, such invalidity or unenforceability
shall not affect the validity or enforceability of any other provision hereof,
but this IP Security Joinder Agreement shall be construed as if such invalid or
unenforceable provision had never been contained herein.
6. COUNTERPARTS. This IP Security Joinder Agreement may be executed in any
number of counterparts each of which when so executed and delivered shall be
deemed an original, and all of which together shall constitute one and the same
instrument, and it shall not be necessary in making proof of this IP Security
Joinder Agreement to produce or account for more than one such counterpart
executed by the Joining Grantor against whom enforcement is sought. Without
limiting the foregoing provisions of this Section 6, the provisions of Section
10.02(b) of the Credit Agreement shall be applicable to this IP Security Joinder
Agreement.
7. DELIVERY. Joining Grantor hereby irrevocably waives notice of
acceptance of this IP Security Joinder Agreement and acknowledges that the
Secured Obligations are and shall be deemed to be incurred, and credit
extensions under the Loan Documents made, in reliance on this IP Security
Joinder Agreement and the Grantor's joinder as a party to the IP Security
Agreement as herein provided.
8. GOVERNING LAW; VENUE; WAIVER OF JURY TRIAL. The provisions of
Section 32 of the IP Security Agreement are hereby incorporated by reference
as if fully set forth herein.
[SIGNATURE PAGE FOLLOWS.]
B-2
IN WITNESS WHEREOF, the Joining Grantor has duly executed and delivered
this IP Security Joinder Agreement as of the day and year first written above.
JOINING GRANTOR:
------------------------------------------
By:
----------------------------------
Name:
----------------------------------
Title:
----------------------------------
ADMINISTRATIVE AGENT:
BANK OF AMERICA, N.A.,
as Administrative Agent
By:
----------------------------------
Name:
----------------------------------
Title:
----------------------------------
B-3
