Exhibit 10.2
SECURITY AGREEMENT
Dated as of July 11, 2003
among
MERISANT COMPANY,
as Borrower,
and Each Other Grantor
From Time to Time Party Hereto
and
CREDIT SUISSE FIRST BOSTON
as Administrative Agent
TABLE OF CONTENTS
ARTICLE I. DEFINED TERMS..........................................................................................3
Section 1.1 Definitions...................................................................................3
Section 1.2 Certain Other Terms...........................................................................7
ARTICLE II GRANT OF SECURITY INTEREST.............................................................................8
Section 2.1 Collateral....................................................................................8
Section 2.2 Grant of Security Interest in Collateral......................................................9
Section 2.3 Cash Collateral Accounts......................................................................9
ARTICLE III REPRESENTATIONS AND WARRANTIES.......................................................................10
Section 3.1 Title; No Other Liens........................................................................10
Section 3.2 Perfection and Priority......................................................................10
Section 3.3 State of Incorporation; Chief Executive Office...............................................11
Section 3.4 Inventory and Equipment......................................................................11
Section 3.5 Pledged Collateral...........................................................................11
Section 3.6 Accounts.....................................................................................12
Section 3.7 Intellectual Property........................................................................12
Section 3.8 Deposit Accounts; Control Accounts; Commercial Tort Claims...................................13
ARTICLE IV COVENANTS.............................................................................................13
Section 4.1 Generally....................................................................................13
Section 4.2 Maintenance of Perfected Security Interest; Further Documentation............................13
Section 4.3 Changes in Locations, Name, Etc..............................................................14
Section 4.4 Pledged Collateral...........................................................................14
Section 4.5 Control Accounts; Eligible Deposit Accounts..................................................16
Section 4.6 Accounts.....................................................................................17
Section 4.7 Delivery of Instruments and Chattel Paper....................................................17
Section 4.8 Intellectual Property........................................................................18
Section 4.9 Vehicles.....................................................................................19
Section 4.10 Payment of Obligations.......................................................................19
Section 4.11 Commercial Tort Claims.......................................................................20
ARTICLE V REMEDIAL PROVISIONS....................................................................................20
Section 5.1 Code and Other Remedies......................................................................20
Section 5.2 Accounts and Payments in Respect of General Intangibles......................................21
Section 5.3 Pledged Collateral...........................................................................22
Section 5.4 Proceeds to be Turned Over To Administrative Agent...........................................23
Section 5.5 Registration Rights..........................................................................23
Section 5.6 Deficiency...................................................................................24
ARTICLE VI THE ADMINISTRATIVE AGENT..............................................................................24
Section 6.1 Administrative Agent's Appointment as Attorney-in-Fact.......................................24
Section 6.2 Duty of Administrative Agent.................................................................26
Section 6.3 Execution of Financing Statements............................................................26
Section 6.4 Authority of Administrative Agent............................................................27
ARTICLE VII MISCELLANEOUS........................................................................................27
Section 7.1 Amendments in Writing........................................................................27
Section 7.2 Notices......................................................................................27
Section 7.3 No Waiver by Course of Conduct; Cumulative Remedies..........................................27
Section 7.4 Successors and Assigns.......................................................................28
Section 7.5 Counterparts.................................................................................28
Section 7.6 Severability.................................................................................28
Section 7.7 Section Headings.............................................................................28
Section 7.8 Entire Agreement.............................................................................28
Section 7.9 Governing Law................................................................................28
Section 7.10 Additional Grantors..........................................................................28
Section 7.11 Release of Collateral........................................................................28
Section 7.12 Reinstatement................................................................................29
SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of July 11, 2003, by MERISANT COMPANY, a
Delaware corporation (the "BORROWER") and each of the other entities listed on
the signature pages hereof or which becomes a party hereto pursuant to SECTION
7.10 (each a "GRANTOR" and, collectively, the "GRANTORS"), in favor of CREDIT
SUISSE FIRST BOSTON, a bank organized under the laws of Switzerland ("CSFB"), as
agent for the Secured Parties (as defined in the Credit Agreement referred to
below) (in such capacity, the "ADMINISTRATIVE AGENT").
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, dated as of July 11, 2003 (as
the same may be amended, restated, supplemented or otherwise modified from time
to time, the "CREDIT AGREEMENT") among the Borrower, Tabletop Holdings, Inc.,
the Lenders and Issuers party thereto, CSFB, as administrative agent for the
Lenders and Issuers, and as sole arranger and book manager, and the other agents
party thereto, the Lenders and the Issuers have severally agreed to make
extensions of credit to the Borrower upon the terms and subject to the
conditions set forth therein; and
WHEREAS, the Grantors other than the Borrower are party to the Guaranty
pursuant to which they have guaranteed the Obligations; and
WHEREAS, a condition precedent to the obligation of the Lenders and the
Issuers to make their respective extensions of credit to the Borrower under the
Credit Agreement that the Grantors shall have executed and delivered this
Agreement to the Administrative Agent;
NOW, THEREFORE, in consideration of the premises and to induce the Lenders,
the Issuers and the Administrative Agent to enter into the Credit Agreement and
to induce the Lenders and the Issuers to make their respective extensions of
credit to the Borrower thereunder, each Grantor hereby agrees with the
Administrative Agent as follows:
ARTICLE I.
DEFINED TERMS
SECTION 1.1 DEFINITIONS.
(a) Unless otherwise defined herein, terms defined in the Credit Agreement
and used herein have the meanings given to them in the Credit Agreement.
(b) Terms used herein that are defined in the UCC have the meanings given
to them in the UCC, including the following terms (which are capitalized
herein):
"ACCOUNT DEBTOR"
"ACCOUNTS"
"CHATTEL PAPER"
"COMMERCIAL TORT CLAIM"
"COMMODITY ACCOUNT"
"COMMODITY INTERMEDIARY"
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"CONTROL"
"DEPOSIT ACCOUNT"
"DOCUMENTS"
"ENTITLEMENT HOLDER"
"ENTITLEMENT ORDER"
"EQUIPMENT"
"FINANCIAL ASSET"
"GENERAL INTANGIBLES"
"INSTRUMENTS"
"INVENTORY"
"INVESTMENT PROPERTY"
"LETTER-OF-CREDIT RIGHTS"
"PAYMENT INTANGIBLE"
"PROCEEDS"
"SECURITY"
"SECURITIES ACCOUNT"
"SECURITIES INTERMEDIARY"
"SECURITY ENTITLEMENT"
"SUPPORTING OBLIGATION"
(c) The following terms shall have the following meanings:
"ADDITIONAL PLEDGED COLLATERAL" means all shares of, limited and/or general
partnership interests in, and limited liability company interests in, and all
securities convertible into, and warrants, options and other rights to purchase
or otherwise acquire, stock of, either (i) any Person that, after the date of
this Agreement, as a result of any occurrence, becomes a direct Subsidiary of
any Grantor or (ii) any issuer of Pledged Stock, any Partnership or any LLC that
are acquired by any Grantor after the date hereof; all certificates or other
instruments representing any of the foregoing; all Security Entitlements of any
Grantor in respect of any of the foregoing; all additional indebtedness from
time to time owed to any Grantor by any obligor on the Pledged Notes and the
instruments evidencing such indebtedness; and all interest, cash, instruments
and other property or Proceeds from time to time received, receivable or
otherwise distributed in respect of or in exchange for any of the foregoing.
Additional Pledged Collateral may be General Intangibles or Investment Property.
"AGREEMENT" means this
Security Agreement.
"CASH COLLATERAL ACCOUNT" means any Deposit Account or Securities Account
established by the Administrative Agent as provided in SECTION 2.3 in which cash
and Cash Equivalents may from time to time be on deposit or held therein as
provided in SECTION 5.2 or SECTION 5.4 or the Credit Agreement.
"COLLATERAL" has the meaning specified in SECTION 2.1.
"CONTROL ACCOUNT" means a Securities Account or Commodity Account subject
of an effective Securities Account Control Agreement maintained by any Grantor
with an Eligible
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Securities Intermediary, and includes all Financial Assets held therein and all
certificates and instruments, if any, representing or evidencing the Financial
Assets contained therein.
"COPYRIGHTS" means (a) all copyrights arising under the laws of the United
States, any other country or any political subdivision thereof, whether
registered or unregistered and whether published or unpublished, all
registrations and recordings thereof, and all applications in connection
therewith, including all registrations, recordings and applications in the
United States Copyright Office or in any foreign counterparts thereof and (b)
the right to obtain all renewals thereof.
"COPYRIGHT LICENSES" means any written agreement naming any Grantor as
licensor or licensee granting any right under any Copyright, including the grant
of rights to copy, publicly perform, create derivative works, manufacture,
distribute, exploit and sell materials derived from any Copyright.
"DEPOSIT ACCOUNT BANK" means a financial institution selected or approved
by the Administrative Deposit Agent and with respect to which a Grantor has
delivered to the Administrative Agent an executed Deposit Account Agreement.
"DEPOSIT ACCOUNT CONTROL AGREEMENT" means a letter agreement, substantially
in the form of Annex 1 (with such changes as may be agreed to by the
Administrative Agent), executed by the Grantor and the Administrative Agent and
acknowledged and agreed to by the relevant Deposit Account Bank.
"ELIGIBLE DEPOSIT ACCOUNT" means a Deposit Account maintained by any
Grantor with an Deposit Account Bank which Deposit Account is the subject of an
effective Deposit Account Control Agreement, and includes all monies on deposit
therein and all certificates and instruments, if any, representing or evidencing
such Deposit Account.
"ELIGIBLE SECURITIES INTERMEDIARY" means a Securities Intermediary or
Commodity Intermediary selected or approved by the Administrative Agent and with
respect to which a Grantor has delivered to the Administrative Agent an executed
Securities Account Control Agreement.
"INTELLECTUAL PROPERTY" means, collectively, all rights, priorities and
privileges of any Grantor relating to intellectual property, whether arising
under United States, multinational or foreign laws or otherwise, including
Copyrights, Copyright Licenses, Patents, Patent Licenses, Trademarks, Trademark
Licenses and trade secrets, and all rights to xxx at law or in equity for any
infringement or other impairment thereof, including the right to receive all
proceeds and damages therefrom.
"INTERCOMPANY NOTE" means any promissory note evidencing loans made by any
Grantor to any of its Subsidiaries or another Grantor.
"LLC" means each limited liability company in which a Grantor has an
interest, including those set forth on Schedule 2.
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"LLC AGREEMENT" means each operating agreement with respect to an LLC, as
each agreement has heretofore been and may hereafter be amended, restated,
supplemented or otherwise modified from time to time.
"MATERIAL INTELLECTUAL PROPERTY" means Intellectual Property owned by or
licensed to a Grantor which is material to its business.
"PARTNERSHIP" means each partnership in which a Grantor has an interest,
including those set forth on Schedule 2.
"PARTNERSHIP AGREEMENT" means each partnership agreement governing a
Partnership, as each such agreement has heretofore been and may hereafter be
amended, restated, supplemented or otherwise modified.
"PATENTS" means (a) all letters patent of the United States, any other
country or any political subdivision thereof and all reissues and extensions
thereof, (b) all provisional and non-provisional applications for letters patent
of the United States or any other country and all divisions, continuations and
continuations-in-part thereof, and (c) all rights to obtain any reissues or
extensions of the foregoing.
"PATENT LICENSE" means all agreements, whether written or oral, providing
for the grant by or to any Grantor of any right to manufacture, use, import,
sell or offer for sale any invention covered in whole or in part by a Patent.
"PLEDGED COLLATERAL" means, collectively, the Pledged Notes, the Pledged
Equity Collateral, all certificates or other instruments representing any of the
foregoing, and all Security Entitlements of any Grantor in respect of any of the
foregoing. Pledged Collateral may be General Intangibles or Investment Property.
"PLEDGED EQUITY COLLATERAL" means, collectively, the Pledged Stock, the
Pledged Partnership Interests, the Pledged LLC Interests, any other Investment
Property of any Grantor, all certificates or other instruments representing any
of the foregoing and all Security Entitlements of any Grantor in respect of any
of the foregoing.
"PLEDGED LLC INTERESTS" means all of any Grantor's right, title and
interest as a member of any LLCs and all of such Grantor's right, title and
interest in, to and under any LLC Agreement to which it is a party.
"PLEDGED NOTES" means all right, title and interest of any Grantor, in the
Instruments evidencing all Indebtedness owed to such Grantor, including the
SwissCo Intercompany Note and all other Indebtedness described on Schedule 2,
issued by the obligors named therein.
"PLEDGED PARTNERSHIP INTERESTS" shall mean all right, title and interest of
any Grantor as a limited or general partner in all Partnerships and all right,
title and interest of any Grantor in, to and under any Partnership Agreements to
which it is a party.
"PLEDGED STOCK" means the shares of Stock owned by each Grantor, including
all shares of Stock listed on Schedule 2; PROVIDED, HOWEVER, that only the
outstanding Stock of an Excluded
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Foreign Subsidiary possessing up to but not exceeding 65% of the voting power of
all classes of Stock of such Excluded Foreign Subsidiary entitled to vote shall
be deemed to be pledged hereunder.
"RELATED CONTRACT" means each
security agreement, lease and other contract
securing or otherwise relating to any Account.
"SECURITIES ACCOUNT CONTROL AGREEMENT" means a letter agreement,
substantially in the form of Annex 2 (with such changes as may be agreed to by
the Administrative Agent), executed by the relevant Grantor and the
Administrative Agent and acknowledged and agreed to by the relevant Eligible
Securities Intermediary.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"TRADEMARKS" means (a) all trademarks, trade names, corporate names,
company names, business names, fictitious business names, trade styles, service
marks, logos and other source or business identifiers, and all goodwill
associated therewith, now existing or hereafter adopted or acquired, all
registrations and recordings thereof, and all applications in connection
therewith, whether in the United States Patent and Trademark Office or in any
similar office or agency of the United States, any State thereof or any other
country or any political subdivision thereof, or otherwise, and all common-law
rights related thereto, and (b) the right to obtain all renewals thereof.
"TRADEMARK LICENSE" means any agreement, whether written or oral, providing
for the grant by or to any Grantor of any right to use any Trademark.
"TRIGGER DATE" has the meaning specified in SECTION 4.5.
"UCC" means the Uniform Commercial Code as from time to time in effect in
the State of
New York; provided, however, that in the event that, by reason of
mandatory provisions of law, any or all of the attachment, perfection or
priority of the Administrative Agent's and the Secured Parties' security
interest in any Collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than the State of
New York, the term "UCC' shall
mean the Uniform Commercial Code as in effect in such other jurisdiction for
purposes of the provisions hereof relating to such attachment, perfection or
priority and for purposes of definitions related to such provisions; provided,
further, that if the UCC is amended after the date hereof, such amendment will
not be given effect for the purposes of this Agreement if and to the extent the
result of such amendment would be to limit or eliminate any item of Collateral.
"VEHICLES" means all vehicles covered by a certificate of title law of any
state.
SECTION 1.2 CERTAIN OTHER TERMS.
(a) In this Agreement, in the computation of periods of time from a
specified date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each mean "to but excluding" and the
word "through" means "to and including."
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(b) The words "herein," "hereof," "hereto" and "hereunder" and similar
words refer to this Agreement as a whole and not to any particular Article,
Section, subsection or clause in this Agreement.
(c) References herein to an Annex, Schedule, Article, Section, subsection
or clause refer to the appropriate Annex or Schedule to, or Article, Section,
subsection or clause in this Agreement.
(d) The meanings given to terms defined herein shall be equally applicable
to both the singular and plural forms of such terms.
(e) Where the context requires, provisions relating to the Collateral or
any part thereof, when used in relation to a Grantor, shall refer to such
Grantor's Collateral or the relevant part thereof.
(f) Any reference in this Agreement to a Loan Document shall include all
appendices, exhibits and schedules thereto, and, unless specifically stated
otherwise all amendments, restatements, supplements or other modifications
thereto, and as the same may be in effect at any and all times such reference
becomes operative.
(g) The term "including" means "including without limitation" except when
used in the computation of time periods.
(h) The term "or" has, except where otherwise indicated, the inclusive
meaning represented by the phrase "and/or".
(i) The terms "Lender," "Issuer," "Administrative Agent" and "Secured
Party" include their respective successors.
(j) References in this Agreement to any statute shall be to such statute
as amended or modified and in effect from time to time.
ARTICLE II
GRANT OF SECURITY INTEREST
SECTION 2.1 COLLATERAL. For the purposes of this Agreement, all of the
following property now owned or at any time hereafter acquired by a Grantor or
in which a Grantor now has or at any time in the future may acquire any right,
title or interests is collectively referred to as the "Collateral":
(a) all Accounts;
(b) all Inventory;
(c) all Equipment;
(d) all General Intangibles, including all Payment Intangibles;
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(e) all Investment Property, including all Control Accounts, Securities
Accounts and Commodities Accounts;
(f) all Documents, Instruments, Chattel Paper and Letter-of-Credit Rights;
(g) all Deposit Accounts (including any Eligible Deposit Accounts);
(h) all Intellectual Property;
(i) all Cash Collateral Accounts;
(j) all Pledged Collateral;
(k) all Vehicles;
(l) all Supporting Obligations;
(m) all books and records pertaining to the other property described in
this SECTION 2.1;
(n) all other goods and personal property of such Grantor whether tangible
or intangible wherever located;
(o) all property of any Grantor held by the Administrative Agent or any
other Secured Party, including all property of every description, in the
possession or custody of or in transit to Administrative Agent or such Secured
Party for any purpose, including safekeeping, collection or pledge, for the
account of such Grantor, or as to which such Grantor may have any right or
power; and
(p) to the extent not otherwise included, all Proceeds and products of
each of the foregoing and all accessions to, substitutions and replacements for,
and rents, profits and products of, each of the foregoing, any and all proceeds
of any insurance, indemnity, warranty or guaranty payable to the Grantor from
time to time with respect to any of the foregoing.
SECTION 2.2 GRANT OF SECURITY INTEREST IN COLLATERAL. Each Grantor, as
collateral security for the full, prompt and complete payment and performance
when due (whether at stated maturity, by acceleration or otherwise) of the
Secured Obligations of such Grantor, hereby collaterally assigns, mortgages,
pledges and hypothecates to the Administrative Agent for the benefit of the
Secured Parties, and grants to the Administrative Agent for the benefit of the
Secured Parties a lien on and security interest in, all of its right, title and
interest in, to and under the Collateral of such Grantor.
SECTION 2.3 CASH COLLATERAL ACCOUNTS. The Administrative Agent may from
time to time establish one or more other Deposit Accounts and one or more
Securities Accounts with such depositaries and Securities Intermediaries as it
in its sole discretion shall determine for purposes of Sections 2.4(b), 2.9(f)
or 7.3 of the Credit Agreement or otherwise. Each such account shall be in the
name of the Administrative Agent (but may also have words referring to the
Borrower and the account's purpose). The Grantors agree that each such account
shall be
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under the sole dominion and control of the Administrative Agent. The
Administrative Agent shall be the Entitlement Holder with respect to each such
Securities Account and the only Person authorized to give Entitlement Orders
with respect thereto. Without limiting the foregoing, funds on deposit in any
Cash Collateral Account may be invested in Cash Equivalents at the direction of
the Administrative Agent and, except during the continuance of an Event of
Default, the Administrative Agent agrees with the Grantor to issue Entitlement
Orders for such investments in Cash Equivalents as requested by the Borrower;
provided, however, that the Administrative Agent shall not have any
responsibility for, or bear any risk of loss of, any such investment or income
thereon. Neither the Borrower nor any other Loan Party or Person claiming on
behalf of or through the Borrower or any other Loan Party shall have any right
to demand payment of any of the funds held in any Cash Collateral Account at any
time an Event of Default shall have occurred and be continuing. The
Administrative Agent shall apply all funds on deposit in a Cash Collateral
Account as provided in the Credit Agreement and, except during the continuance
of an Event of Default, agrees to cause any funds remaining on deposit therein
after all Obligations then due and payable have been satisfied (other than any
funds deposited in accordance with clause (x)(B)(ii) or clause (y)(B)(ii) of
Section 2.4(b) or Section 2.9(f) of the Credit Agreement) at the written
direction of the Borrower.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
To induce the Lenders, the Issuers and the Administrative Agent to enter
into the Credit Agreement, each Grantor hereby represents and warrants to the
Administrative Agent, the Lenders, the Issuers and the other Secured Parties
that:
SECTION 3.1 TITLE; NO OTHER LIENS. Except for the Lien granted to the
Administrative Agent pursuant to this Agreement and the other Liens permitted to
exist on the Collateral (other than the Pledged Stock or the Pledged Notes)
under Section 6.3 of the Credit Agreement, such Grantor is the record and
beneficial owner of the Pledged Collateral pledged by it hereunder constituting
Instruments or certificated securities and is the Entitlement Holder of all such
Pledged Collateral constituting Investment Property held in a Securities Account
and has rights in and power to transfer each other item of Collateral in which a
Lien is granted by it hereunder, free and clear of any and all Liens. For the
avoidance of doubt, it is understood and agreed that such Grantor may, as part
of its business, grant licenses to third parties to use Intellectual Property
owned or developed by such Grantor. For purposes of this Agreement and the other
Loan Documents, such licensing activity shall not constitute a "Lien" on such
Intellectual Property.
SECTION 3.2 PERFECTION AND PRIORITY. The UCC and Copyright Office filings
having been duly made in the locations specified and in the form attached to
Schedule 3 hereto, the security interest granted pursuant to this Agreement
constitutes (or, solely with respect to (i) any Collateral for which perfection
is not governed by the UCC or filing with the United States Copyright Office,
upon the completion of the filings and other actions specified on Schedule 4
(which, in the case of all filings and other documents referred to on such
Schedule 4, have been delivered to the Administrative Agent in duly completed
and executed form) or (ii) any Deposit Accounts, upon the execution and delivery
of Deposit Account Control Agreements with respect to any Deposit Accounts, will
constitute) a valid and continuing perfected security interest in
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favor of the Administrative Agent in the Collateral. Such security interest is
prior to all other Liens on the Collateral except (other than with respect to
the Pledged Stock or the Pledged Notes) for Liens which have priority over the
Administrative Agent's Lien as permitted under Section 6.3 of the Credit
Agreement.
SECTION 3.3 STATE OF INCORPORATION; CHIEF EXECUTIVE OFFICE.
(a) Except as set forth on Schedule 1, within the five-year period
preceding the Closing Date such Grantor has not had, or operated in any
jurisdiction under, any trade name, fictitious name or other name other than its
legal name.
(b) On the Closing Date such Grantor's jurisdiction of organization,
organizational identification number, if any, and the location of such Grantor's
chief executive office or sole place of business are specified on Schedule 1.
SECTION 3.4 INVENTORY AND EQUIPMENT. On the Closing Date, such Grantor's
Inventory and Equipment (other than mobile goods and Inventory or Equipment in
transit) are kept at the locations listed on Schedule 5.
SECTION 3.5 PLEDGED COLLATERAL.
(a) The Pledged Stock, Pledged Partnership Interests and Pledged LLC
Interests pledged hereunder by such Grantor and listed on Schedule 2 and
constitute that percentage of the issued and outstanding equity of all classes
of each issuer thereof as set forth on Schedule 2.
(b) All of the Pledged Stock, Pledged Partnership Interests and Pledged
LLC Interests held by such Grantor as of the Closing Date are listed on Schedule
2 and have been duly and validly issued and are fully paid and nonassessable.
(c) The Pledged Notes pledged hereunder by such Grantor, being all of the
Pledged Notes held by such Grantor (after giving effect to the consummation of
the Recapitalization and repayment of certain notes owed to the Borrower by
certain equity owners of Holdings with the proceeds of the dividends thereto by
Holdings effected as part of the Recapitalization, which repayment shall have
taken place no later than July 14, 2003), are listed on Schedule 2.
(d) (i) Each of the Pledged Notes, as to which the Borrower or any
Subsidiary is an obligor, constitutes the legal, valid and binding obligation of
the obligor with respect thereto, enforceable in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, and general equitable principles (whether
considered in a proceeding in equity or at law); and (ii) to the best knowledge
of any Grantor that is a holder thereof, each other Pledged Note constitutes the
legal, valid and binding obligation of the obligor with respect thereto,
enforceable in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, and general equitable
principles (whether considered in a proceeding in equity or at law).
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(e) All Pledged Collateral and, if applicable, any Additional Pledged
Collateral, consisting of certificated securities or Instruments (other than as
specified in SECTION 4.7) has been delivered to the Administrative Agent in
accordance with SECTION 4.4(a).
(f) All Pledged Collateral held by a Securities Intermediary in a
Securities Account is (or, at all times after the Trigger Date specified in
SECTION 4.5, will be) in a Control Account.
(g) Other than the Pledged Partnership Interests and the Pledged LLC
Interests that constitute General Intangibles, there is no Pledged Collateral
other than that represented by certificated securities or Instruments in the
possession of the Administrative Agent or that consisting of Financial Assets
that are (or, at all times after the Trigger Date specified in Section 4.5, will
be) held in a Control Account.
(h) No Person other than the Administrative Agent has Control over any
Investment Property of such Grantor.
(i) The LLC Agreement governing any Pledged LLC Interest and the
Partnership Agreement governing any Pledged Partnership Interest provide that,
upon the occurrence and during the continuance of an Event of Default, the
Administrative Agent shall be entitled to exercise all of the rights of the
Grantor granting the security interest therein, and that a transferee or
assignee of a membership interest or partnership interest, as the case may be,
of such LLC or Partnership, as the case may be, shall become a member or
partner, as the case may be, of such LLC or Partnership, as the case may be,
entitled to participate in the management thereof and, upon the transfer of the
entire interest of such Grantor, such Grantor ceases to be a member or partner,
as the case may be.
(j) The shares of Pledged Stock pledged by such Grantor hereunder
constitute all the issued and outstanding shares of all classes of the Capital
Stock of each Subsidiary of Holdings or the Borrower owned by such Grantor or,
solely in the case of any Voting Stock of any Excluded Foreign Subsidiary, at
least 65% of the Voting Stock of such Excluded Foreign Subsidiary.
SECTION 3.6 ACCOUNTS. No amount payable to such Grantor under or in
connection with any Account is evidenced by any Instrument or Chattel Paper
which has not been delivered to the Administrative Agent, properly endorsed for
transfer, to the extent delivery is required by SECTION 4.4.
SECTION 3.7 INTELLECTUAL PROPERTY.
(a) Schedule 6 lists all Material Intellectual Property of such Grantor on
the date hereof, separately identifying that owned by such Grantor and that
licensed to such Grantor. The Material Intellectual Property set forth on
Schedule 6 for such Grantor constitutes all of the intellectual property rights
necessary for such Grantor to conduct its business.
(b) On the date hereof, all Material Intellectual Property owned by such
Grantor is valid, subsisting, unexpired and enforceable, has not been adjudged
invalid and has not been abandoned, opposed or cancelled or otherwise challenged
and the use thereof in the business of such Grantor does not infringe the
intellectual property rights of any other Person.
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(c) Except as set forth in Schedule 6, on the Closing Date, none of the
Material Intellectual Property owned by such Grantor is the subject of any
licensing or franchise agreement pursuant to which such Grantor is the licensor
or franchisor.
(d) No holding, decision or judgment has been rendered by any Governmental
Authority that would limit, cancel or question the validity or enforceability
of, or such Grantor's rights in, any Material Intellectual Property.
(e) No action or proceeding seeking to limit, cancel or question the
validity of any Material Intellectual Property owned by such Grantor or such
Grantor's ownership interest therein is on the date hereof pending or, to the
knowledge of such Grantor, threatened. There are no claims, judgments or
settlements to be paid by such Grantor relating to the Material Intellectual
Property nor any injunctions issued limiting or barring use of any Material
Intellectual Property.
SECTION 3.8 DEPOSIT ACCOUNTS; SECURITIES ACCOUNTS; COMMERCIAL TORT
CLAIMS. The only Deposit Accounts or Securities Accounts maintained by any
Grantor on the Closing Date are those listed on Schedule 7, which sets forth
such information separately for each Grantor. On the Closing Date, no Grantor
holds any Commercial Tort Claims having a value individually or in the aggregate
in excess of $5,000,000 except as specified on Schedule 8.
ARTICLE IV
COVENANTS
As long as any of the Obligations (other than indemnity or reimbursement
obligations not then payable) or the Commitments remain outstanding, unless the
Requisite Lenders otherwise consent in writing, each Grantor agrees with the
Administrative Agent that:
SECTION 4.1 GENERALLY. Such Grantor shall (a) except for the security
interest created by this Agreement, not create or suffer to exist any Lien upon
or with respect to any of the Collateral, except (other than with respect to the
Pledged Stock or the Pledged Notes) Liens permitted under Section 6.3 of the
Credit Agreement; (b) not use or permit any Collateral to be used unlawfully or
in violation of any provision of this Agreement, any other Loan Document, any
Requirement of Law, any Contractual Obligation, any Related Document or any
policy of insurance covering the Collateral; (c) not sell, transfer or assign
(by operation of law or otherwise) any Collateral except as permitted under the
Credit Agreement; (d) except for the Loan Documents, not enter into any
agreement or undertaking restricting the right or ability of such Grantor or the
Administrative Agent to sell, assign or transfer any of the Collateral except as
permitted under the Credit Agreement; and (e) promptly notify the Administrative
Agent of its entry into any agreement or assumption of undertaking that
restricts the ability to sell, assign or transfer any of the Collateral, other
than such agreements or assumptions of undertaking entered into in the ordinary
course of business and consistent with past practices.
SECTION 4.2 MAINTENANCE OF PERFECTED SECURITY INTEREST; FURTHER
DOCUMENTATION.
(a) Such Grantor will maintain the security interest created by this
Agreement as a perfected security interest having at least the priority
described in SECTION 3.2 and shall defend such security interest against the
claims and demands of all Persons (other than Persons holding
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Liens (other than with respect to the Pledged Stock or the Pledged Notes)
expressly permitted by SECTION 6.3 of the Credit Agreement).
(b) Such Grantor will furnish to the Administrative Agent 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 may reasonably request, all in reasonable detail.
At any time and from time to time, upon the written request of the
Administrative Agent, and at the sole expense of such Grantor, such Grantor will
promptly and duly execute and deliver, and have recorded, such further
instruments and documents and take such further action as the Administrative
Agent may reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted,
including the filing of any financing or continuation statement under the UCC
(or other similar laws) in effect in any jurisdiction with respect to the
security interest created hereby and the execution and delivery of Securities
Account Control Agreements and Deposit Account Control Agreements or otherwise
taking any actions necessary to enable the Administrative Agent to obtain
Control with respect to any Collateral.
SECTION 4.3 CHANGES IN LOCATIONS, NAME, ETC.
(a) Except upon 15 days' prior written notice to the Administrative Agent
and delivery to the Administrative Agent of (i) all additional executed
financing statements and other documents reasonably requested by the
Administrative Agent to maintain the validity, perfection and priority of the
security interests provided for herein and (ii) if applicable, a written
supplement to Schedule 5 showing any additional location (or change in location)
at which Inventory or Equipment shall be kept, such Grantor will not:
(i) permit any of the Inventory or Equipment having a Fair Market
Value of more than $5,000,000 to be kept at a location other than those
listed on Schedule 5;
(ii) change its jurisdiction of incorporation or the location of
its chief executive office or sole place of business from that referred to
in SECTION 3.3; or
(iii) change its name, identity or corporate structure to such an
extent that any financing statement filed in connection with this Agreement
would become misleading.
(b) Such Grantor will keep and maintain at its own cost and expense
satisfactory and complete records of the Collateral, including a record of all
payments received and all credits granted with respect to the Collateral and all
other dealings with the Collateral. If requested by the Administrative Agent at
any time after the occurrence and during the continuance of an Event of Default,
the security interest of the Administrative Agent shall be noted on the
certificate of title of each Vehicle.
SECTION 4.4 PLEDGED COLLATERAL.
(a) Such Grantor will (i) deliver to the Administrative Agent, all
certificates or Instruments representing or evidencing any Pledged Collateral
(including Additional Pledged
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Collateral), whether now existing or hereafter acquired, in suitable form for
transfer by delivery or, as applicable, accompanied by such Grantor's
endorsement, where necessary, or duly executed instruments of transfer or
assignment in blank, all in form and substance satisfactory to the
Administrative Agent, together, in respect of any Additional Pledged Collateral,
with a Pledge Amendment, duly executed by the Grantor, in substantially the form
of Annex 3 (a "PLEDGE AMENDMENT") or such other documentation acceptable to the
Administrative Agent, and (ii) from and after the Trigger Date, maintain all
other Pledged Collateral constituting Investment Property in a Control Account.
Such Grantor authorizes the Administrative Agent to attach each Pledge Amendment
to this Agreement. The Administrative Agent shall have the right, at any time in
its discretion and without notice to the Grantor, to transfer to or to register
in its name or in the name of its nominees any or all of the Pledged Collateral.
The Administrative Agent shall have the right at any time after the occurrence
and during the continuance of an Event of Default to exchange any certificate or
instrument representing or evidencing any Pledged Collateral for certificates or
instruments of smaller or larger denominations.
(b) Except as provided in ARTICLE V, such Grantor shall be entitled to
receive all cash dividends paid in respect of the Pledged Equity Collateral
(other than liquidating or distributing dividends). Any other sums paid upon or
in respect of any Pledged Collateral, including any sums paid upon the
liquidation or dissolution of any issuer of any of the Pledged Collateral, any
distribution of capital made on or in respect of any of the Pledged Equity
Collateral or any property distributed upon or with respect to any of the
Pledged Equity Collateral pursuant to the recapitalization or reclassification
of the capital of any issuer of Pledged Collateral or pursuant to the
reorganization thereof shall, unless otherwise subject to a perfected security
interest in favor of the Administrative Agent, be delivered to the
Administrative Agent to be held by it hereunder as additional collateral
security for the Secured Obligations (or, in the case of any payment on or in
respect of the SwissCo Intercompany Note, be applied as specified in SECTION
2.9(c) of the Credit Agreement). If any sum of money or property so paid or
distributed in respect of any of the Pledged Collateral shall be received by
such Grantor, such Grantor shall, until such money or property is paid or
delivered to the Administrative Agent, hold such money or property in trust for
the Administrative Agent, segregated from other funds of such Grantor, as
additional security for the Secured Obligations.
(c) Except as provided in ARTICLE V, such Grantor will be entitled to
exercise all voting, consent, corporate partnership or limited liability company
rights with respect to the Pledged Equity Collateral. Notwithstanding the
foregoing, such Grantor shall not, without the prior written consent of the
Administrative Agent, (a) cast any vote, give any consent, exercise any right or
take any other action which would impair the Collateral or which would be
inconsistent with or result in any violation of any provision of the Credit
Agreement, this Agreement, any other Loan Document or any Contractual Obligation
or (b) (i) enable or permit any issuer of Pledged Equity Collateral to issue any
stock or other equity securities of any nature or to issue any other securities
convertible into or granting the right to purchase or exchange for any stock or
other equity securities of any nature of any issuer of Pledged Equity
Collateral, (ii) sell, assign, transfer, exchange or otherwise dispose of, or
grant any option with respect to the Pledged Equity Collateral or the Proceeds
therefrom (except pursuant to a transaction expressly permitted by the Credit
Agreement), (iii) create, incur or permit to exist any Lien or option in favor
of, or any claim of any Person with respect to, any Pledged Equity Collateral or
Proceeds thereof, or any interest therein, except for the security interest
crested by this Agreement, or (iv)
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enter into any agreement or undertaking restricting the right or ability of the
Administrative Agent or (except for the Senior Subordinated Notes Indenture)
such Grantor to sell, assign or transfer any of the Pledged Equity Collateral or
the Proceeds thereof.
(d) Such Grantor shall not grant to any Person other than the
Administrative Agent, and shall not permit any Person other than the
Administrative Agent to have, Control over any Deposit Account or Investment
Property, except to the extent permitted under Sections 6.3(xii) of the Credit
Agreement.
(e) In the case of each Grantor which is an issuer of Pledged Collateral,
such Grantor agrees to be bound by the terms of this Agreement relating to the
Pledged Collateral issued by it and will comply with such terms insofar as such
terms are applicable to it. In the case of each Grantor which is a partner in a
Partnership, such Grantor hereby consents to the extent required by the
applicable Partnership Agreement to the pledge by each other Grantor, pursuant
to the terms hereof, of the Pledged Partnership Interests in such Partnership
and to the transfer of such Pledged Partnership Interests to the Administrative
Agent or its nominee and to the substitution of the Administrative Agent or its
nominee as a substituted partner in such Partnership with all the rights, powers
and duties of a general partner or a limited partner, as the case may be. In the
case of each Grantor which is a member of an LLC, such Grantor hereby consents
to the extent required by the applicable LLC Agreement to the pledge by each
other Grantor, pursuant to the terms hereof, of the Pledged LLC Interests in
such LLC and to the transfer of such Pledged LLC Interests to the Administrative
Agent or its nominee and to the substitution of the Administrative Agent or its
nominee as a substituted member of the LLC with all the rights, powers and
duties of a member of the LLC in question.
(f) Such Grantor will not agree to any amendment of an LLC Agreement or
Partnership Agreement that in any way adversely affects the perfection of the
security interest of the Administrative Agent in the Pledged Partnership
Interests or Pledged LLC Interests pledged by such Grantor hereunder, including
any amendment electing to treat the membership interest or partnership interest
of such Grantor as a security under Section 8-103 of the UCC.
(g) No provision hereof shall affect the obligation of the Borrower under
SECTION 2.9(a)(ii) of the Credit Agreement with respect to any payment on or in
respect of the SwissCo Intercompany Note.
SECTION 4.5 CONTROL ACCOUNTS; ELIGIBLE DEPOSIT ACCOUNTS.
At all times after the date (the "TRIGGER DATE") that is the earlier of (i) the
date 10 Business Days after the written request of the Administrative Agent, or
(ii) if on the date of such request an Event of Default has occurred and is
continuing, the date of such request:
(a) Such Grantor will (i) deposit in an Eligible Deposit Account all cash
and all Proceeds received by such Grantor, (ii) not establish or maintain any
Securities Account that is not a Control Account and (iii) not establish or
maintain any account with any financial or other institution other than a
Deposit Account Bank, a Lender or an Affiliate of a Lender; provided, however,
that any Grantor may maintain payroll, withholding tax and other fiduciary
accounts.
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(b) Such Grantor shall instruct each Account Debtor or other Person
obligated to make a payment to such Grantor to make payment, or to continue to
make payment, as the case may be, to an Eligible Deposit Account and will
deposit in an Eligible Deposit Account all Proceeds received by such Grantor
from any other Person immediately upon receipt.
(c) In the event (i) such Grantor or any Eligible Securities Intermediary
or Deposit Account Bank shall, after the date hereof, terminate an agreement
with respect to the maintenance of a Control Account or an Eligible Deposit
Account for any reason, (ii) the Administrative Agent shall demand such
termination as a result of the failure of an Eligible Securities Intermediary or
Deposit Account Bank to comply with the terms of the applicable Deposit Account
Control Agreement or Securities Account Control Agreement, or (iii) the
Administrative Agent determines in its sole discretion that the financial
condition of an Eligible Securities Intermediary or Deposit Account Bank, as the
case may be, has materially deteriorated, such Grantor agrees to notify all of
its obligors that were making payments to such terminated Control Account or
Eligible Deposit Account, as the case may be, to make all future payments to
another Control Account or Eligible Deposit Account, as the case may be.
SECTION 4.6 ACCOUNTS.
(a) Such Grantor will not, other than in the ordinary course of business
consistent with its past practice, (i) grant any extension of the time of
payment of any Account, (ii) compromise or settle any Account for less than the
full amount thereof, (iii) release, wholly or partially, any Person liable for
the payment of any Account, (iv) allow any credit or discount on any Account, or
(v) amend, supplement or modify any Account in any manner that could adversely
affect the value thereof.
(b) The Administrative Agent shall have the right to make test
verifications of the Accounts in any manner and through any medium that it
reasonably considers advisable, and such Grantor shall furnish all such
assistance and information as the Administrative Agent may reasonably require in
connection therewith. At any time and from time to time, upon the Administrative
Agent's request and at the expense of the relevant Grantor, such Grantor shall
cause independent public accountants or others satisfactory to the
Administrative Agent to furnish to the Administrative Agent reports showing
reconciliations, aging and test verifications of, and trial balances for, the
Accounts; provided, however, that unless an Event of Default shall be
continuing, the Administrative Agent shall request no more than four such
reports during any calendar year.
(c) Such Grantor will deliver to the Administrative Agent a copy of each
material demand, notice or document received by it that questions or calls into
the doubt the validity or enforceability of more than 5% of the aggregate amount
of the then outstanding Receivables.
SECTION 4.7 DELIVERY OF INSTRUMENTS AND CHATTEL PAPER. If any amount
payable under or in connection with any of the Collateral owned by such Grantor
shall be or become evidenced by an Instrument or Chattel Paper (other than any
Instrument or Chattel Paper which, together with any other Instruments or
Chattel Paper excluded pursuant to this clause, has an aggregate principal
amount not in excess of $100,000), such Grantor shall promptly deliver such
Instrument or Chattel Paper to the Administrative Agent, duly indorsed in a
manner satisfactory
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to the Administrative Agent, or, if consented to by the Administrative Agent,
shall xxxx all such Instruments and Chattel Paper with the following legend:
"This writing and the obligations evidenced or secured hereby are subject to the
security interest of Credit Suisse First Boston, as Administrative Agent".
SECTION 4.8 INTELLECTUAL PROPERTY.
(a) Such Grantor (either itself or through licensees) will (i) continue to
use each Trademark that is Material Intellectual Property in order to maintain
such Trademark in full force and effect with respect to each class of goods for
which such Trademark is currently used, free from any claim of abandonment for
non-use, (ii) maintain as in the past the quality of products and services
offered under such Trademark, (iii) use such Trademark with the appropriate
notice of registration and all other notices and legends required by applicable
Requirements of Law, (iv) not adopt or use any xxxx which is confusingly similar
or a colorable imitation of such Trademark unless the Administrative Agent shall
obtain a perfected security interest in such xxxx pursuant to this Agreement and
(v) not (and not permit any licensee or sublicensee thereof to) do any act or
knowingly omit to do any act whereby such Trademark may become invalidated or
impaired in any way or destroy or otherwise tarnish the goodwill associated with
any Trademark.
(b) Such Grantor (either itself or through licensees) will not do any act,
or omit to do any act, whereby any Patent which is Material Intellectual
Property may become forfeited, abandoned or dedicated to the public.
(c) Such Grantor (either itself or through licensees) (i) will not (and
will not permit any licensee or sublicensee thereof to) do any act or omit to do
any act whereby any portion of the Copyrights which is Material Intellectual
Property may become invalidated or otherwise impaired and (ii) will not (either
itself or through licensees) do any act or omit to do any act whereby any
portion of the Copyrights that are Material Intellectual Property may fall into
the public domain.
(d) Such Grantor (either itself or through licensees) will not do any act,
or omit to do any act, whereby any trade secret which is Material Intellectual
Property may become publicly available or otherwise unprotectable.
(e) Such Grantor (either itself or through licensees) will not do any act
that knowingly uses any Material Intellectual Property to infringe the
intellectual property rights of any other Person.
(f) Such Grantor will notify the Administrative Agent immediately if it
knows, or has reason to know, that any application or registration relating to
any Material Intellectual Property may become forfeited, abandoned or dedicated
to the public, or of any adverse determination or development (including the
institution of, or any such determination or development in, any proceeding in
the United States Patent and Trademark Office, the United States Copyright
Office or any court or tribunal in any country) regarding such Grantor's
ownership of, right to use, interest in, or the validity of, any Material
Intellectual Property or such Grantor's right to register the same or to own and
maintain the same.
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(g) Whenever such Grantor, either by itself or through any agent, licensee
or designee, shall file an application for the registration of any Intellectual
Property with the United States Patent and Trademark Office, the United States
Copyright Office or any similar office or agency within or outside the United
States, such Grantor shall report such filing to the Administrative Agent within
five Business Days after the last day of the fiscal quarter in which such filing
occurs. Upon request of the Administrative Agent, such Grantor shall execute and
deliver, and have recorded, any and all agreements, instruments, documents, and
papers as the Administrative Agent may request to evidence the Administrative
Agent's security interest in any Copyright, Patent or Trademark and the goodwill
and general intangibles of such Grantor relating thereto or represented thereby.
(h) Such Grantor will take all reasonable actions necessary or requested
by the Administrative Agent, including in any proceeding before the United
States Patent and Trademark Office, the United States Copyright Office or any
similar office or agency, to maintain and pursue each application (and to obtain
the relevant registration) and to maintain each registration of any Copyright,
Trademark or Patent that is Material Intellectual Property, including filing of
applications for renewal, affidavits of use, affidavits of incontestability and
opposition and interference and cancellation proceedings.
(i) In the event that any Material Intellectual Property is infringed upon
or misappropriated or diluted by a third party, such Grantor shall notify the
Administrative Agent promptly after such Grantor learns thereof. Such Grantor
shall take appropriate action in response to such infringement, misappropriation
or dilution, as determined in the exercise of reasonable business judgment,
including promptly bringing suit for infringement, misappropriation or dilution
and to recover any and all damages for such infringement, misappropriation or
dilution, and shall take such other actions may be appropriate in its reasonable
judgment under the circumstances to protect such Material Intellectual Property.
(j) Unless otherwise agreed to by the Administrative Agent, such Grantor
will execute and deliver to the Administrative Agent for filing in (i) the
United States Copyright Office a short-form copyright
security agreement in the
form attached hereto as Annex 5, (ii) in the United States Patent and Trademark
Office a short-form patent
security agreement in the form attached hereto as
Annex 6 and (iii) the United States Patent and Trademark Office a short-form
trademark
security agreement in form attached hereto as Annex 7.
SECTION 4.9 VEHICLES. Upon the request of the Administrative Agent,
within 30 days after the date of such request and, with respect to any Vehicles
acquired by such Grantor subsequent to the date of any such request, within 30
days after the date of acquisition thereof, such Grantor shall file all
applications for certificates of title/ownership indicating the Administrative
Agent's first priority security interest in the Vehicle covered by such
certificate, and any other necessary documentation, in each office in each
jurisdiction which the Administrative Agent shall reasonably deem advisable to
perfect its security interests in the Vehicles.
SECTION 4.10 PAYMENT OF OBLIGATIONS. Such Grantor will pay and discharge
or otherwise satisfy at or before maturity or before they become delinquent, as
the case may be, all lawful governmental claims, taxes, assessments, charges and
levies, imposed upon the Collateral
19
or in respect of income and profits therefrom, as well as all claims of any kind
(including claims for labor, materials and supplies) against or with respect to
the Collateral, except where contested in good faith, by proper proceedings and
adequate reserves therefor have been established on the books of such Grantor in
conformity with GAAP and except to the extent the failure to do so would not, in
the aggregate, be reasonably expected to have a Material Adverse Effect.
SECTION 4.11 COMMERCIAL TORT CLAIMS . If such Grantor shall at any time
hold or acquire a Commercial Tort Claim other than or in addition to those set
forth on Schedule 8 relating to any of the Collateral and having a value
individually or in the aggregate in excess of $5,000,000 (each such Commercial
Tort Claim, an "ADDITIONAL COMMERCIAL TORT CLAIM"), such Grantor shall promptly
notify the Administrative Agent in a writing authenticated by such Grantor of
the brief details of such Additional Commercial Tort Claim. Such Grantor shall
grant to the Administrative Agent in such writing a security interest in such
Additional Commercial Tort Claim and in the Proceeds thereof, all in accordance
with and subject to the terms of this Agreement and such writing shall be in
form and substance reasonably satisfactory to the Administrative Agent. Each
Grantor hereby agrees to execute and deliver any additional documents or
instruments, including any financing statements or amendments to any then
existing financing statements, that the Administrative Agent reasonably deems
necessary to create, perfect and protect the Administrative Agent's Lien on and
security interest in such Additional Commercial Tort Claim.
ARTICLE V
REMEDIAL PROVISIONS
SECTION 5.1 CODE AND OTHER REMEDIES. During the continuance of an Event
of Default, the Administrative Agent may exercise, in addition to all other
rights and remedies granted to them in this Agreement and in any other
instrument or agreement securing, evidencing or relating to the Secured
Obligations, all rights and remedies of a secured party under the UCC or any
other applicable law. Without limiting the generality of the foregoing, the
Administrative Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon any Grantor or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith sell,
lease, assign, give option or options to purchase, or otherwise dispose of and
deliver the Collateral or any part thereof (or contract to do any of the
foregoing), in one or more parcels at public or private sale or sales, at any
exchange, broker's board or office of the Administrative Agent or any Lender or
elsewhere upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for cash or on credit or for future delivery without
assumption of any credit risk. The Administrative Agent shall have the right
upon any such public sale or sales, and, to the extent permitted by law, upon
any such private sale or sales, to purchase the whole or any part of the
Collateral so sold, free of any right or equity of redemption in any Grantor,
which right or equity is hereby waived and released. Each Grantor further
agrees, at the Administrative Agent's request, to assemble the Collateral and
make it available to the Administrative Agent at places which the Administrative
Agent shall reasonably select, whether at such Grantor's premises or elsewhere.
The Administrative Agent shall apply the net proceeds of any action taken by it
pursuant to this SECTION 5.1, after deducting all reasonable costs and expenses
of every kind
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incurred in connection therewith or incidental to the care or safekeeping of any
of the Collateral or in any way relating to the Collateral or the rights of the
Administrative Agent and any other Secured Party hereunder, including reasonable
attorneys' fees and disbursements, to the payment in whole or in part of the
Secured Obligations, in such order as the Credit Agreement shall prescribe, and
only after such application and after the payment by the Administrative Agent of
any other amount required by any provision of law, including Section 9-610 of
the UCC, need the Administrative Agent account for the surplus, if any, to any
Grantor. To the extent permitted by applicable law, each Grantor waives all
claims, damages and demands it may acquire against the Administrative Agent or
any other Secured Party arising out of the exercise by them of any rights
hereunder. If any notice of a proposed sale or other disposition of Collateral
shall be required by law, such notice shall be deemed reasonable and proper if
given at least 10 days before such sale or other disposition.
SECTION 5.2 ACCOUNTS AND PAYMENTS IN RESPECT OF GENERAL INTANGIBLES.
(a) If required by the Administrative Agent at any time during the
continuance of an Event of Default, any payments of Accounts or payments in
respect of General Intangibles, when collected by any Grantor, shall be
forthwith (and, in any event, within two Business Days) deposited by such
Grantor in the exact form received, duly indorsed by such Grantor to the
Administrative Agent if required, in a Cash Collateral Account maintained under
the sole dominion and control of the Administrative Agent, subject to withdrawal
by the Administrative Agent as provided in SECTION 5.4. Until so turned over,
such payments shall be held by such Grantor in trust for the Administrative
Agent, segregated from other funds of such Grantor. Each such deposit of
Proceeds of Accounts and payments in respect of General Intangibles shall be
accompanied by a report identifying in reasonable detail the nature and source
of the payments included in the deposit.
(b) At the Administrative Agent's request, during the continuance of an
Event of Default, each Grantor shall deliver to the Administrative Agent all
original and other documents evidencing, and relating to, the agreements and
transactions which gave rise to the Accounts or payments in respect of General
Intangibles, including all original orders, invoices and shipping receipts.
(c) The Administrative Agent may, without notice, at any time during the
continuance of an Event of Default, limit or terminate the authority of a
Grantor to collect its Accounts or amounts due under General Intangibles or any
thereof.
(d) The Administrative Agent in its own name or in the name of others may
at any time during the continuance of an Event of Default communicate with
Account Debtors to verify with them to the Administrative Agent's satisfaction
the existence, amount and terms of any Accounts or amounts due under any General
Intangibles.
(e) Upon the request of the Administrative Agent at any time during the
continuance of an Event of Default, each Grantor shall notify Account Debtors
that the Accounts or payments in respect of General Intangibles have been
collaterally assigned to the Administrative Agent and that payments in respect
thereof shall be made directly to the Administrative Agent. In addition,
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the Administrative Agent may at any time during the continuance of an Event of
Default so enforce such Grantor's rights against Account Debtors and obligors of
General Intangibles.
(f) Anything herein to the contrary notwithstanding, each Grantor shall
remain liable under each of the Accounts and payments in respect of General
Intangibles to observe and perform all the conditions and obligations to be
observed and performed by it thereunder, all in accordance with the terms of any
agreement giving rise thereto. Neither the Administrative Agent nor any other
Secured Party shall have any obligation or liability under any agreement giving
rise to an Account or a payment in respect of a General Intangible by reason of
or arising out of this Agreement or the receipt by Administrative Agent nor any
other Secured Party of any payment relating thereto, nor shall Administrative
Agent nor any other Secured Party be obligated in any manner to perform any of
the obligations of any Grantor under or pursuant to any agreement giving rise to
an Account or a payment in respect of a General Intangible, to make any payment,
to make any inquiry as to the nature or the sufficiency of any payment received
by it or as to the sufficiency of any performance by any party thereunder, to
present or file any claim, to take any action to enforce any performance or to
collect the payment of any amounts which may have been assigned to it or to
which it may be entitled at any time or times.
SECTION 5.3 PLEDGED COLLATERAL.
(a) During the continuance of an Event of Default, upon notice by the
Administrative Agent to the relevant Grantor or Grantors, (i) the Administrative
Agent shall have the right to receive any and all cash dividends, payments or
other Proceeds paid in respect of the Pledged Collateral and make application
thereof to the Obligations in the order set forth in the Credit Agreement, and
(ii) the Administrative Agent or its nominee may exercise (A) all voting,
consent, corporate, partnership or limited liability company and other rights
pertaining to the Pledged Collateral at any meeting of shareholders, partners or
members, as the case may be, of the relevant issuer or issuers of Pledged
Collateral or otherwise and (B) any and all rights of conversion, exchange and
subscription and any other rights, privileges or options pertaining to the
Pledged Collateral as if it were the absolute owner thereof (including the right
to exchange at its discretion any and all of the Pledged Collateral upon the
merger, consolidation, reorganization, recapitalization or other fundamental
change in the corporate structure of any issuer of Pledged Securities, the right
to deposit and deliver any and all of the Pledged Collateral with any committee,
depositary, transfer agent, registrar or other designated agency upon such terms
and conditions as the Administrative Agent may determine), all without liability
except to account for property actually received by it; provided, however, that
the Administrative Agent shall have no duty to any Grantor to exercise any such
right, privilege or option and shall not be responsible for any failure to do so
or delay in so doing.
(b) In order to permit the Administrative Agent to exercise the voting and
other consensual rights which it may be entitled to exercise pursuant hereto and
to receive all dividends and other distributions which it may be entitled to
receive hereunder, (i) each Grantor shall promptly execute and deliver (or cause
to be executed and delivered) to the Administrative Agent all such proxies,
dividend payment orders and other instruments as the Administrative Agent may
from time to time reasonably request and (ii) without limiting the effect of
clause (i) above, such Grantor hereby grants to the Administrative Agent an
irrevocable proxy to vote all or any part of the Pledged Collateral and to
exercise all other rights, powers, privileges and
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remedies to which a holder of the Pledged Collateral would be entitled
(including giving or withholding written consents of shareholders, partners or
members, as the case may be, calling special meetings of shareholders, partners
or members, as the case may be, and voting at such meetings), which proxy shall
be effective, automatically and without the necessity of any action (including
any transfer of any Pledged Collateral on the record books of the issuer
thereof) by any other person (including the issuer of such Pledged Collateral or
any officer or agent thereof) during the continuance of an Event of Default and
which proxy shall only terminate upon the payment in full of the Secured
Obligations.
(c) Each Grantor hereby expressly authorizes and instructs each issuer of
any Pledged Collateral pledged hereunder by such Grantor to (i) comply with any
instruction received by it from the Administrative Agent in writing that (A)
states that an Event of Default has occurred and is continuing and (B) is
otherwise in accordance with the terms of this Agreement, without any other or
further instructions from such Grantor, and each Grantor agrees that such issuer
shall be fully protected in so complying and (ii) unless otherwise expressly
permitted hereby, pay any dividends or other payments with respect to the
Pledged Collateral directly to the Administrative Agent for deposit in a Cash
Collateral Account or, with the consent of the Administrative Agent, an Eligible
Deposit Account.
SECTION 5.4 PROCEEDS TO BE TURNED OVER TO ADMINISTRATIVE AGENT. All
Proceeds received by the Administrative Agent hereunder shall be held by the
Administrative Agent in a Cash Collateral Account maintained under its sole
dominion and control. All Proceeds while held by the Administrative Agent in a
Cash Collateral Account (or by such Grantor in trust for the Administrative
Agent) shall continue to be held as collateral security for the Secured
Obligations and shall not constitute payment thereof until applied as provided
in the Credit Agreement.
SECTION 5.5 REGISTRATION RIGHTS.
(a) If the Administrative Agent shall determine to exercise its right to
sell any or all of the Pledged Equity Collateral pursuant to SECTION 5.1, and if
in the opinion of the Administrative Agent it is necessary or advisable to have
the Pledged Equity Collateral, or any portion thereof to be registered under the
provisions of the Securities Act, the relevant Grantor will cause the issuer
thereof to (i) execute and deliver, and cause the directors and officers of such
issuer to execute and deliver, all such instruments and documents, and do or
cause to be done all such other acts as may be, in the opinion of the
Administrative Agent, necessary or advisable to register the Pledged Equity
Collateral, or that portion thereof to be sold, under the provisions of the
Securities Act, (ii) use its best efforts to cause the registration statement
relating thereto to become effective and to remain effective for a period of one
year from the date of the first public offering of the Pledged Equity
Collateral, or that portion thereof to be sold and (iii) make all amendments
thereto and/or to the related prospectus which, in the opinion of the
Administrative Agent, are necessary or advisable, all in conformity with the
requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto. Each Grantor agrees to
cause such issuer to comply with the provisions of the securities or "Blue Sky"
laws or other comparable law of any jurisdiction which the Administrative Agent
shall designate and to make available to its security holders, as soon as
23
practicable, an earnings statement (which need not be audited) which will
satisfy the provisions of Section 11(a) of the Securities Act.
(b) Each Grantor recognizes that the Administrative Agent may be unable to
effect a public sale of any or all the Pledged Equity Collateral by reason of
certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise or may determine that a public sale is
impracticable or not commercially reasonable and, accordingly, may resort to one
or more private sales thereof to a restricted group of purchasers which will be
obliged to agree, among other things, to acquire such securities for their own
account for investment and not with a view to the distribution or resale
thereof. Each Grantor acknowledges and agrees that any such private sale may
result in prices and other terms less favorable than if such sale were a public
sale and, notwithstanding such circumstances, agrees that any such private sale
shall be deemed to have been made in a commercially reasonable manner. The
Administrative Agent shall be under no obligation to delay a sale of any of the
Pledged Equity Collateral for the period of time necessary to permit the issuer
thereof to register such securities for public sale under the Securities Act, or
under applicable state securities laws, even if such issuer would agree to do
so.
(c) Each Grantor agrees to use its best efforts to do or cause to be done
all such other acts as may be necessary to make such sale or sales of all or any
portion of the Pledged Collateral pursuant to this SECTION 5.5 valid and binding
and in compliance with any and all other applicable Requirements of Law. Each
Grantor further agrees that a breach of any of the covenants contained in this
SECTION 5.5 will cause irreparable injury to the Administrative Agent and other
Secured Parties, that the Administrative Agent and the other Secured Parties
have no adequate remedy at law in respect of such breach and, as a consequence,
that each and every covenant contained in this SECTION 5.5 shall be specifically
enforceable against such Grantor, and such Grantor hereby waives and agrees not
to assert any defenses against an action for specific performance of such
covenants except for a defense that no Event of Default has occurred under the
Credit Agreement.
SECTION 5.6 DEFICIENCY. Each Grantor shall remain liable for any
deficiency if the proceeds of any sale or other disposition of the Collateral
are insufficient to pay its Secured Obligations and the fees and disbursements
of any attorneys employed by the Administrative Agent or any other Secured Party
to collect such deficiency.
ARTICLE VI
THE ADMINISTRATIVE AGENT
SECTION 6.1 ADMINISTRATIVE AGENT'S APPOINTMENT AS ATTORNEY-IN-FACT.
(a) Each Grantor hereby irrevocably constitutes and appoints the
Administrative Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of such Grantor and in the name of
such Grantor or in its own name, for the purpose of carrying out the terms of
this Agreement, to take any and all appropriate action and to execute any and
all documents and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, and, without limiting the generality of the
foregoing, each Grantor hereby gives the
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Administrative Agent the power and right, on behalf of such Grantor, without
notice to or assent by such Grantor, to do any or all of the following:
(i) in the name of such Grantor or its own name, or otherwise,
take possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under any
Account or General Intangible or with respect to any other Collateral and
file any claim or take any other action or proceeding in any court of law
or equity or otherwise deemed appropriate by the Administrative Agent for
the purpose of collecting any and all such moneys due under any Account or
General Intangible or with respect to any other Collateral whenever
payable;
(ii) in the case of any Intellectual Property, execute and
deliver, and have recorded, any and all agreements, instruments, documents
and papers as the Administrative Agent may request to evidence the
Administrative Agent's security interest in such Intellectual Property and
the goodwill and General Intangibles of such Grantor relating thereto or
represented thereby;
(iii) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral, effect any repairs or pay or discharge
any insurance called for by the terms of this Agreement (including all or
any part of the premiums therefor and the costs thereof);
(iv) execute, in connection with any sale provided for in
SECTION 5.1 or SECTION 5.5, any endorsements, assignments or other
instruments of conveyance or transfer with respect to the Collateral; and
(v) (A) direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Administrative Agent or as the Administrative
Agent shall direct; (B) ask or demand for, collect, and receive payment of
and receipt for, any and all moneys, claims and other amounts due or to
become due at any time in respect of or arising out of any Collateral; (C)
sign and indorse any invoices, freight or express bills, bills of lading,
storage or warehouse receipts, drafts against debtors, assignments,
verifications, notices and other documents in connection with any of the
Collateral; (D) commence and prosecute any suits, actions or proceedings at
law or in equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in respect
of any Collateral; (E) defend any suit, action or proceeding brought
against such Grantor with respect to any Collateral; (F) settle, compromise
or adjust any such suit, action or proceeding and, in connection therewith,
give such discharges or releases as the Administrative Agent may deem
appropriate; (G) assign any Copyright, Patent or Trademark (along with the
goodwill of the business to which any such Trademark pertains), throughout
the world for such term or terms, on such conditions, and in such manner,
as the Administrative Agent shall in its sole discretion determine,
including without limitation the execution and filing of any documents
necessary to effectuate and/or record such assignment; and (H) generally,
sell, transfer, pledge and make any agreement with respect to or otherwise
deal with any of the Collateral as fully and
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completely as though the Administrative Agent were the absolute owner
thereof for all purposes, and do, at the Administrative Agent's option and
such Grantor's expense, at any time, or from time to time, all acts and
things which the Administrative Agent deems necessary to protect, preserve
or realize upon the Collateral and the Administrative Agent's and the other
Secured Parties' security interests therein and to effect the intent of
this Agreement, all as fully and effectively as such Grantor might do.
Anything in this SECTION 6.1(a) to the contrary notwithstanding, the
Administrative Agent agrees that it will not exercise any rights under the power
of attorney provided for in this SECTION 6.1(a) unless an Event of Default shall
be continuing.
(b) If any Grantor fails to perform or comply with any of its agreements
contained herein, the Administrative Agent, at its option, but without any
obligation so to do, upon the occurrence and during the continuance of an Event
of Default may perform or comply, or otherwise cause performance or compliance,
with such agreement and shall notify such Grantor of any such performance or
compliance.
(c) The expenses of the Administrative Agent incurred in connection with
actions undertaken as provided in this SECTION 6.1, together with interest
thereon at a rate per annum equal to the rate per annum at which interest would
then be payable on past due Revolving Loans that are Base Rate Loans under the
Credit Agreement, from the date of payment by the Administrative Agent to the
date reimbursed by the relevant Grantor, shall be payable by such Grantor to the
Administrative Agent on demand.
(d) Each Grantor hereby ratifies all that said attorneys shall lawfully do
or cause to be done by virtue hereof. All powers, authorizations and agencies
contained in this Agreement are coupled with an interest and are irrevocable
until this Agreement is terminated and the security interests created hereby are
released.
SECTION 6.2 DUTY OF ADMINISTRATIVE AGENT. The Administrative Agent's sole
duty with respect to the custody, safekeeping and physical preservation of the
Collateral in its possession shall be to deal with it in the same manner as the
Administrative Agent deals with similar property for its own account. Neither
the Administrative Agent, any other Secured Party nor any of their respective
officers, directors, employees or agents shall be liable for failure to demand,
collect or realize upon any of the Collateral or for any delay in doing so or
shall be under any obligation to sell or otherwise dispose of any Collateral
upon the request of any Grantor or any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof. The powers
conferred on the Administrative Agent hereunder are solely to protect the
Administrative Agent's interest in the Collateral and shall not impose any duty
upon the Administrative Agent or any other Secured Party to exercise any such
powers. The Administrative Agent and the other Secured Parties shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
employees or agents shall be responsible to any Grantor for any act or failure
to act hereunder, except for their own gross negligence or willful misconduct.
SECTION 6.3 AUTHORITY TO FILE FINANCING STATEMENTS. Each Grantor
authorizes the Administrative Agent or its representatives to file or record
financing statements (including
26
continuation statements in respect thereof and any financing statement
containing a description of the Collateral granted hereunder as "all assets" or
"all personal property") and other filing or recording documents or instruments
with respect to the Collateral without the signature of such Grantor in such
form and in such offices as the Administrative Agent reasonably determines
appropriate to perfect the security interests of the Administrative Agent under
this Agreement. A photographic or other reproduction of this Agreement shall be
sufficient as a financing statement or other filing or recording document or
instrument for filing or recording in any jurisdiction.
SECTION 6.4 AUTHORITY OF ADMINISTRATIVE AGENT. Each Grantor acknowledges
that the rights and responsibilities of the Administrative Agent under this
Agreement with respect to any action taken by the Administrative Agent or the
exercise or non-exercise by the Administrative Agent of any option, voting
right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement shall, as between the Administrative
Agent and the other Secured Parties, be governed by the Credit Agreement and by
such other agreements with respect thereto as may exist from time to time among
them, but, as between the Administrative Agent and the Grantors, the
Administrative Agent shall be conclusively presumed to be acting as agent for
the Administrative Agent and the other Secured Parties with full and valid
authority so to act or refrain from acting, and no Grantor shall be under any
obligation, or entitlement, to make any inquiry respecting such authority.
ARTICLE VII
MISCELLANEOUS
SECTION 7.1 AMENDMENTS IN WRITING. Other than in connection with the
execution and delivery of a Joinder Agreement in the form of Annex 4 relating to
the addition of Grantors, none of the terms or provisions of this Agreement may
be waived, amended, supplemented or otherwise modified except in accordance with
Section 9.1 of the Credit Agreement.
SECTION 7.2 NOTICES. All notices, requests and demands to or upon the
Administrative Agent or any Grantor hereunder shall be effected in the manner
provided for in Section 9.8 of the Credit Agreement; provided, however, that any
such notice, request or demand to or upon any Grantor other than the Borrower
shall be addressed to such Grantor care in care of the Borrower at the
Borrower's notice address set forth in such Section 9.8.
SECTION 7.3 NO WAIVER BY COURSE OF CONDUCT; CUMULATIVE REMEDIES. Neither
the Administrative Agent nor any other Secured Party shall by any act (except by
a written instrument pursuant to SECTION 7.1), delay, indulgence, omission or
otherwise be deemed to have waived any right or remedy hereunder or to have
acquiesced in any Default or Event of Default. No failure to exercise, nor any
delay in exercising, on the part of the Administrative Agent or any other
Secured Party, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Administrative Agent or
any other Secured Party of any right or remedy hereunder on any one occasion
shall not be construed as a bar to any right or remedy which the Administrative
Agent or such other Secured Party would otherwise have on any future occasion.
The rights and remedies herein provided are cumulative, may be exercised singly
or concurrently and are not exclusive of any other rights or remedies provided
by law.
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SECTION 7.4 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
the successors and assigns of each Grantor and shall inure to the benefit of the
Administrative Agent and each other Secured Party and their successors and
assigns; provided, however, that no Grantor may assign, transfer or delegate any
of its rights or obligations under this Agreement without the prior written
consent of the Administrative Agent.
SECTION 7.5 COUNTERPARTS. This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts
(including by telecopy), and all of said counterparts taken together shall be
deemed to constitute one and the same agreement. Signature pages may be detached
from multiple separate counterparts and attached to a single counterpart so that
all signature pages are attached to the same document. Delivery of an executed
signature page of this Agreement by facsimile transmission shall be as effective
as delivery of a manually executed counterpart hereof.
SECTION 7.6 SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 7.7 SECTION HEADINGS. The Article and Section titles contained in
this Agreement are and shall be without substantive meaning or content of any
kind whatsoever and are not part of the agreement of the parties hereto.
SECTION 7.8 ENTIRE AGREEMENT. This Agreement together with the other Loan
Documents represents the entire agreement of the parties and supersedes all
prior agreements and understandings relating to the subject matter hereof.
SECTION 7.9 GOVERNING LAW. This agreement and the rights and obligations
of the parties hereto, including the interpretation, construction, validity and
enforceability hereof, shall be governed by, and construed and interpreted in
accordance with, the law of the state of
New York.
SECTION 7.10 ADDITIONAL GRANTORS. If, pursuant to Section 5.10(c) of the
Credit Agreement, Holdings or the Borrower shall be required to cause any
Subsidiary of Holdings or the Borrower that is not a Grantor to become a Grantor
hereunder, such Subsidiary shall execute and deliver to the Administrative Agent
a Joinder Agreement in the form of Annex 4 and shall thereafter for all purposes
be a party hereto and have the same rights, benefits and obligations as a
Grantor party hereto on the Closing Date.
SECTION 7.11 RELEASE OF COLLATERAL.
(a) At the time provided in Section 8.7(b)(i) of the Credit Agreement, the
Collateral shall be released from the Lien created hereby and this Agreement and
all obligations (other than those expressly stated to survive such termination)
of the Administrative Agent and each Grantor hereunder shall terminate, all
without delivery of any instrument or performance of any act by any party, and
all rights to the Collateral shall revert to the applicable Grantor. At the
request and sole expense of any Grantor following any such termination, the
Administrative Agent shall
28
promptly deliver to such Grantor any Collateral of such Grantor held by the
Administrative Agent hereunder and execute and deliver to such Grantor such
documents as such Grantor shall reasonably request to evidence such termination.
(a) If any of the Collateral shall be sold or disposed of by any Grantor
in a transaction permitted by the Credit Agreement or if any Collateral is
otherwise permitted to be released pursuant to SECTION 8.7(b) of the Credit
Agreement, the Collateral so sold or disposed of shall be released from the Lien
created hereby to the extent provided in Section 8.7(b)(ii) or (iii) of the
Credit Agreement and, in connection therewith, the Administrative Agent, at the
request and sole expense of the Borrower, shall promptly execute and deliver to
the Borrower all releases or other documents reasonably necessary or desirable
for the release of the Lien created hereby on such Collateral. At the request
and sole expense of the Borrower, a Grantor shall be released from its
obligations hereunder in the event that all the capital stock of such Grantor
shall be so sold or disposed to a Person other than an Included Subsidiary in a
transaction permitted by Article VI of the Credit Agreement; provided, however,
that the Borrower shall have delivered to the Administrative Agent, at least
five Business Days prior to the date of the proposed release, a written request
for release identifying the relevant Grantor and the terms of the sale or other
disposition in reasonable detail, including the price thereof and any expenses
in connection therewith, together with a certification by a Responsible Officer
of the Borrower stating that such transaction is in compliance with the Credit
Agreement and the other Loan Documents.
SECTION 7.12 REINSTATEMENT. Each Grantor further agrees that, if any
payment made by any Loan Party or other Person and applied to the Obligations is
at any time annulled, avoided, set aside, rescinded, invalidated, declared to be
fraudulent or preferential or otherwise required to be refunded or repaid, or
the proceeds of Collateral are required to be returned by any Secured Party to
such Loan Party, its estate, trustee, receiver or any other party, including any
Grantor, under any bankruptcy law, state or federal law, common law or equitable
cause, then, to the extent of such payment or repayment, any Lien or other
Collateral securing such liability shall be and remain in full force and effect,
as fully as if such payment had never been made or, if prior thereto the Lien
granted hereby or other Collateral securing such liability hereunder shall have
been released or terminated by virtue of such cancellation or surrender), such
Lien or other Collateral shall be reinstated in full force and effect, and such
prior cancellation or surrender shall not diminish, release, discharge, impair
or otherwise affect any Lien or other Collateral securing the obligations of any
Grantor in respect of the amount of such payment.
29
IN WITNESS WHEREOF, each of the undersigned has caused this
Security
Agreement to be duly executed and delivered as of the date first above written.
MERISANT COMPANY
TABLETOP HOLDINGS, INC.
MERISANT FOREIGN HOLDINGS I, INC.
MERISANT US, INC.
By: /s/ Xxxxxx X. Xxxxxx XX
---------------------------------------------
Name: Xxxxxx X. Xxxxxx XX
--------------------------------------
Title: VP, General Counsel & Secretary of each of
-------------------------------
the foregoing Grantors
30
ACCEPTED AND AGREED:
CREDIT SUISSE FIRST BOSTON,
as Administrative Agent
By: /s/ S. Xxxxxxx Xxx
------------------------------------
Name: S. Xxxxxxx Xxx
Title: Director
By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
31
ACKNOWLEDGMENT AND CONSENT
Reference is made to that certain
Security Agreement (the "SECURITY
AGREEMENT"), dated July 11, 2003, made by the Grantors party thereto for the
benefit of Credit Suisse First Boston, as Administrative Agent. Capitalized
terms used herein but not defined herein have the meanings given them in the
Security Agreement.
The undersigned hereby acknowledges receipt of a copy of the Security
Agreement and agrees for the benefit of the Administrative Agent and the Lenders
as follows:
1. The undersigned will be bound by the terms of the Security Agreement and
will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify the Administrative Agent promptly in writing
of the occurrence of any of the events described in Section 4.4 of the Security
Agreement and will comply promptly with any requirements thereof.
3. The terms of Sections 5.3(c) and 5.5 of the Security Agreement shall
apply to the undersigned, MUTATIS MUTANDIS, with respect to all actions that may
be required pursuant to Section 5.3(c) or 5.5 of the Security Agreement.
MERISANT SPAIN S.L.
By:
-------------------------
Name:
Title:
Address for Notices:
00 Xxxxx Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Fax: (000) 000-0000
32
