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Exhibit 10.3
FORM OF SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of July 25, 1997, made by First
New England Dental Centers, Inc., a Delaware corporation and ▇▇▇▇▇▇ & ▇▇▇▇▇▇,
P.C., a Massachusetts professional corporation (each a "Grantor" and
collectively, the "Grantors"), in favor of Imprimis Investors LLC, in its
capacity as Collateral Agent (the "Collateral Agent") for certain Purchasers (as
hereinafter defined).
W I T N E S S E T H :
WHEREAS, certain purchasers (each a "Purchaser" and
collectively, the "Purchasers"), the Grantors and the Collateral Agent are
parties to that certain Note Purchase Agreement, dated as of the date hereof
(such agreement, as amended, restated, supplemented or otherwise modified from
time to time, being hereafter referred to as the "Note Purchase Agreement");
WHEREAS, pursuant to the Note Purchase Agreement, the
Purchasers have agreed to purchase certain debt securities (the "Notes") from
the Grantors, the proceeds of which shall be used (i) to repay existing
indebtedness of the Grantors, (ii) to make acquisitions of dental facilities,
and (iii) to fund working capital of the Grantors;
WHEREAS, it is a condition precedent to the effectiveness of
the Note Purchase Agreement and the Purchasers' purchasing the Notes from the
Grantors that the Grantors shall have executed and delivered to the Collateral
Agent for the benefit of the Purchasers a security agreement providing for the
grant to the Collateral Agent of a security interest in all personal property of
each of the Grantors;
NOW, THEREFORE, in consideration of the premises and the
agreements herein and in order to induce the Purchasers to purchase the Notes
from the Grantors pursuant to the Note Purchase Agreement, each of the Grantors
hereby agrees with the Collateral Agent as follows:
SECTION 1. Definitions. Reference is hereby made to the Note
Purchase Agreement for a statement of the terms thereof. All terms used in this
Agreement which are defined in the Note Purchase Agreement or in Article 9 of
the Uniform Commercial Code (the "Code") currently in effect in the State of New
York, and which are not otherwise defined herein, shall have the same meanings
herein as set forth therein.
SECTION 2 Grant of Security Interest. As collateral security
for all of the Obligations (as defined in Section 3 hereof), the Grantors hereby
pledge and assign to the Collateral Agent for the
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benefit of the Purchasers, and grant to the Collateral Agent for the benefit of
the Purchasers, a continuing security interest in, all personal property and
fixtures of the Grantors, wherever located and whether now or hereafter existing
and whether now owned or hereafter acquired, of every kind and description,
tangible or intangible (the "Collateral"), including, without limitation, all of
each of the Grantors' right, title and interest in and to the following:
(a) all equipment of any kind (including, without limitation,
all furniture, fixtures, machinery and other like property), wherever located
and whether now or hereafter existing and whether now owned or hereafter
acquired, together with all substitutes, replacements, accessions and additions
thereto, and all tools, parts, accessories and attachments used in connection
therewith (hereinafter collectively referred to as the "Equipment");
(b) all inventory of any kind, wherever located and whether
now or hereafter existing and whether now owned or hereafter acquired
(including, without limitation, all types of inventory, merchandise, goods,
property and other assets, raw, in process and finished, and all other
inventory, merchandise, goods and other tangible personal property that are held
for sale or lease by either of the Grantors), all materials used or consumed in
the business of either of the Grantors, goods returned to or repossessed by
either of the Grantors, and goods in which either of the Grantors has an
interest in mass or in joint or other interest or right of any kind, including
consigned goods or goods being processed, all accessions thereto and products
thereof and all packing and shipping materials (hereinafter collectively
referred to as the "Inventory");
(c) (i) all accounts, contract rights, chattel paper,
instruments, documents, general intangibles and other obligations of any kind,
whether now or hereafter existing and whether now owned or hereafter acquired,
arising out of or in connection with the sale or lease of goods or the rendering
of services or otherwise, including, without limitation, (A) all rights relating
to the performance by or for either of the Grantors of management, advisory,
consulting or other similar services, (B) all rights relating to the sale or
other transfer of property to, or the construction, renovation or other
improvement of property by or for, either of the Grantors or any of their
affiliates, (C) all rights relating to any partnership in which either of the
Grantors has any interest as a general or limited partner or otherwise,
including all moneys due from time to time in respect thereof, and (D) all
rights relating to any lease to which either of the Grantors is a party as
lessee or lessor, including all moneys due from time to time in respect thereof;
and (ii) all rights now or hereafter existing in and to all credit insurance,
guaranties, letters of credit, security agreements, leases and other contracts
now or hereafter existing and securing or otherwise relating to any such
accounts, contract rights, chattel paper, instruments, general intangibles or
obligations (including, without limitation, the contracts described in Schedule
I hereto) (any and all such accounts, contract rights, chattel paper,
instruments, general intangibles and obligations being hereinafter referred to
collectively as the "Receivables", and any and all such credit insurance,
guaranties, letters of credit, security agreements, leases and other contracts
being hereinafter referred to collectively as the "Related Contracts");
(d) (i) all trademarks, service marks, tradenames, business
names, trade styles, designs, logos and other source or business identifiers and
all general intangibles of like nature, now or hereafter owned, adopted,
acquired or used by either of the Grantors (including,
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without limitation, all trademarks, service marks, tradenames, business names,
trade styles, designs, logos and other source or business identifiers described
in Schedules II or V hereto), all applications, registrations and recordings
thereof (including, without limitation, applications, registrations and
recordings 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), and all reissues, extensions or renewals
thereof, together with all goodwill of the business symbolized by such marks and
all customer lists, formulae and other records of the Grantors relating to the
distribution of products and services in connection with which any of such marks
are used and all income, royalties, damages and payments now or hereafter due
and/or payable under and with respect thereto, including, without limitation,
payments under all licenses entered into in connection therewith and damages and
payments for past and future infringements or dilutions thereof and the right to
▇▇▇ for past, present and future infringements and dilutions thereof
(hereinafter referred to collectively as the "Trademarks"), and (ii) all
licenses, contracts or other agreements, whether written or oral, naming either
of the Grantors as licensor or licensee and providing for the grant of any right
to use any Trademark, including, without limitation, all trademark licenses
described in Schedule II hereto, together with any goodwill connected with and
symbolized by any such trademark licenses or agreements and the right to prepare
for sale and sell any and all Inventory now or hereafter owned by either of the
Grantors and now or hereafter covered by such licenses (hereinafter referred to
collectively as the "Trademark Licenses");
(e) (i) all letters patent, design patents and utility
patents, and all copyrights, inventions, trade secrets, proprietary information
and technology, know-how, formulae and other general intangibles of like nature,
now existing or hereafter acquired (including, without limitation, all letters
patent, design patents and utility patents described in Schedule III hereto),
all applications, registrations and recordings thereof (including, without
limitation, applications, registrations and recordings in the United States
Patent and Trademark Office or in any similar office or agency of the United
States or any other country or any political subdivision thereof), and all
reissues, divisions, continuations, continuations in part and extensions or
renewals thereof (hereinafter referred to collectively as the "Patents"), and
(ii) all licenses, contracts or other agreements, whether written or oral,
naming either of the Grantors as licensee or licensor and providing for the
grant of any right to manufacture, use or sell any invention covered by any
patent (including, without limitation, all patent licenses set forth in Schedule
III hereto) (hereinafter referred to collectively as the "Patent Licenses" and
together with the Trademark Licenses, the "Licenses");
(f) (i) all moneys, securities and other property, and the
proceeds thereof, now or hereafter held or received by, or in transit to, any
Purchaser or the Collateral Agent from or for the Grantors, whether for
safekeeping, pledge, custody, transmission, collection or otherwise, and all of
the Grantors' claims against any Purchaser or the Collateral Agent at any time
existing; (ii) all rights relating to the sale or other transfer of property to,
or the construction, renovation or other improvement of property by or for,
either of the Grantors; (iii) all rights, interests, choses in action, causes of
action, claims and all other general intangibles of every kind and nature, in
each instance whether now owned or hereafter acquired by either of the Grantors,
including, without limitation, all corporate and other business records, all
loans, royalties, and all
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other forms of obligations receivable whatsoever (other than Receivables); (iv)
all computer programs, software, printouts and other computer materials,
customer lists, credit files, correspondence and advertising materials; (v) all
customer and supplier contracts, sale orders, rights under license and franchise
agreements, and other contracts and contract rights; (vi) all interests in
partnerships and joint ventures, including all moneys due from time to time in
respect thereof; (vii) all federal, state and local tax refunds and federal,
state and local tax refund claims; (viii) all right, title and interest under
leases, subleases, licenses and concessions and other agreements relating to
personal property, including all moneys due from time to time in respect
thereof; (ix) all payments due or made to either of the Grantors in connection
with any requisition, confiscation, condemnation, seizure or forfeiture of any
property by any Person or Governmental Authority or regulatory body; (x) all
deposit accounts (general or special) with any financial institution and all
funds on deposit therein; (xi) all credits with and other claims against third
parties (including carriers and shippers) (other than Receivables); (xii) all
rights to indemnification; (xiii) all reversionary interests in pension and
profit sharing plans and reversionary, beneficial and residual interests in
trusts; (xiv) all letters of credit, guaranties, liens, security interests and
other security held by or granted to either of the Grantors; (xv) all
instruments, files, records, ledger sheets and documents covering or relating to
any of the Collateral; and (xvi) all general intangibles, whether or not similar
to the foregoing in each instance, however and wherever arising;
(g) the books and records of the Grantors relating to any of
the foregoing Collateral, including, without limitation, all customer contracts,
sale orders, minute books, ledgers, records, computer programs, software,
printouts and other computer materials, customer lists, credit files,
correspondence and advertising materials, in each case indicating, summarizing
or evidencing any of the Collateral; and
(h) all cash and non-cash proceeds of any and all of the
foregoing Collateral (including, without limitation, (i) damages and payments
for past or future infringements of the Trademarks or the Patents and (ii) the
right to ▇▇▇ for past, present and future infringements of the Trademarks or the
Patents) and, to the extent not otherwise included, all payments under insurance
(whether or not the Collateral Agent is the loss payee thereof), and any
indemnity, warranty or guaranty, payable by reason of loss or damage to or
otherwise with respect to any of the foregoing Collateral.
SECTION 3. Security for Obligations. The security interest
created hereby in the Collateral constitutes continuing collateral security for
all of the following obligations, whether now existing or hereafter incurred
(the "Obligations"):
(a) the prompt payment by the Grantors, as and when due and
payable, of all amounts from time to time owing by the Grantors to the
Purchasers in respect of the Note Purchase Agreement, the Notes and the other
Note Documents, including, without limitation, principal of and interest on the
Notes (including, without limitation, all interest that accrues after the
commencement of any case, proceeding or other action relating to bankruptcy,
insolvency or reorganization of the either of the Grantors whether or not the
payment of such interest is unenforceable or is not allowable due to the
existence of such case, proceeding or other action),
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all fees, commissions, expense reimbursements, indemnifications and all other
amounts due or to become due under the Note Purchase Agreement, the Notes and
any other Note Document; and
(b) the due performance and observance by the Grantors of all
of their other obligations from time to time existing in respect of the Note
Purchase Agreement and all other Note Documents.
SECTION 4. Representations and Warranties. Each of the
Grantors represents and warrants as follows:
(a) There is no pending or threatened action, suit, proceeding
or claim before any court or other Governmental Authority or any arbitrator, or
any order, judgment or award by any court or other Governmental Authority or
arbitrator, that may adversely affect the grants by the Grantors, or the
perfection or priority, of the security interest purported to be created hereby
in the Collateral, or the exercise by the Collateral Agent of any of its rights
or remedies hereunder.
(b) All taxes, assessments and other governmental charges
imposed upon either of the Grantors or any property of either of the Grantors
(including, without limitation, all federal income and social security taxes on
employees' wages) and which have become due and payable on or prior to the date
hereof have been paid, except to the extent contested in good faith by proper
proceedings which stay the imposition of any penalty, fine or lien resulting
from the non-payment thereof and with respect to which adequate reserves in
accordance with GAAP, have been established for the payment thereof.
(c) All Equipment and Inventory of each of the Grantors now
existing is, and all Equipment and Inventory of the Grantors hereafter existing
will be, located at the addresses specified therefor in Schedule IV hereto. The
chief place of business and chief executive office of each of the Grantors, the
place where each of the Grantors keeps its records concerning Receivables and
all originals of all chattel paper and other documents which constitute
Receivables are located at the addresses specified therefor in Schedule IV
hereto. None of the Receivables is evidenced by a promissory note or other
instrument. Set forth in Schedule V hereto is a complete and correct list of
each tradename used by each of the Grantors.
(d) Each of the Grantors has delivered to the Collateral Agent
complete and correct copies of each Related Contract described in Schedule I
hereto, each Trademark License described in Schedule II hereto, and each Patent
License described in Schedule III hereto, including all schedules and exhibits
thereto. Each such Related Contract and License sets forth the entire agreement
and understanding of the parties thereto relating to the subject matter thereof,
and there are no other agreements, arrangements or understandings, written or
oral, relating to the matters covered thereby or the rights of either of the
Grantors in respect thereof. Each Related Contract now existing is, and each
other Related Contract will be, the legal, valid and binding obligation of the
parties thereto, enforceable against such parties in accordance with its terms.
No default thereunder by any such party has occurred, nor does any defense,
offset, deduction or counterclaim exist thereunder in favor of any such party.
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(e) Each of the Grantors owns and controls, or otherwise
possesses adequate rights to use, all of its Trademarks and Patents, which are
the only trademarks and patents necessary to conduct its business in
substantially the same manner as conducted as of the date hereof. Schedule II
hereto sets forth a true and complete list of all Trademarks and Trademark
Licenses owned or used by each of the Grantors as of the date hereof. Schedule
III hereto sets forth a true and complete list of all Patents and Patent
Licenses owned or used by each of the Grantors as of the date hereof. All of
such Patents and Trademarks are subsisting and in full force and effect, have
not been adjudged invalid or unenforceable, are valid and enforceable and have
not been abandoned in whole or in part. Except as set forth in Schedule II or
III hereto, none of such Patents or Trademarks is the subject of any licensing
or franchising agreement. The Grantors have no knowledge of any conflict with
the rights of others to any Trademark or Patent and, to the best knowledge of
the Grantors, neither of the Grantors is now infringing or in conflict with any
such rights of others in any material respect, and, no other Person is now
infringing or in conflict in any material respect with any such properties,
assets and rights owned or used by either of the Grantors.
(f) Each of the Grantors is and will be at all times the sole
and exclusive owner of the Collateral free and clear of any Lien, claim,
security interest, charge or other encumbrance of any kind with full authority
to sell, transfer and grant a security interest in, each item of Collateral,
except for Liens permitted pursuant to the Note Purchase Agreement. No effective
financing statement or other instrument similar in effect covering all or any
part of the Collateral is on file in any recording or filing office except such
as may have been filed with respect to the Liens permitted pursuant to the Note
Purchase Agreement.
(g) The exercise by the Collateral Agent of any of its rights
and remedies hereunder will not contravene law or any contractual restriction
binding on or otherwise affecting either of the Grantors or any of its
properties and will not result in or require the creation of any Lien, claim,
security interest, charge or other encumbrance upon or with respect to any of
its properties.
(h) No authorization or approval or other action by, and no
notice to or filing with, any Governmental Authority or other regulatory body,
or any other Person, is required for (i) the grant by each of the Grantors, or
the perfection, of the security interest purported to be created hereby in the
Collateral or (ii) the exercise by the Collateral Agent of any of its rights and
remedies hereunder, except (A) with respect to the perfection of the security
interest created hereby in United States Trademarks and Patents, for the
recording of the Assignment for Security (Trademarks) and Assignment for
Security (Patents) referred to in Section 4(i) hereof in the United States
Patent and Trademark Office and the filing under the Uniform Commercial Code as
in effect in the applicable jurisdiction of the financing statements described
in Schedule VI hereto, all of which financing statements have been duly filed
and are in full force and effect, or (B) with respect to the perfection of the
security interest created hereby in foreign Trademarks and Patents, for
registrations and filings in jurisdictions located outside of the United States
and covering rights in such jurisdictions relating to Patents, Trademarks,
Patent Licenses and Trademark Licenses.
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(i) This Agreement creates valid liens on, and security
interests in, the Collateral, in favor of the Collateral Agent as security for
the Obligations, subject only to the Liens permitted pursuant to the Note
Purchase Agreement. The Collateral Agent's having possession of all instruments
and cash constituting Collateral from time to time, the recording of the
Assignment for Security (Patents) and the Assignment for Security (Trademarks)
executed pursuant hereto in the United States Patent and Trademark Office, the
filing of the financing statements described in Schedule VI hereto and, with
respect to Patents and Trademarks hereafter existing and not covered by such
Assignment for Security (Patents) or such Assignment for Security (Trademarks),
the recording in the United States Patent and Trademark Office of appropriate
instruments of assignment, result in the perfection of such security interests.
Such security interests are, or in the case of Collateral in which either of the
Grantors obtains rights after the date hereof, will be, perfected, first
priority security interests, subject only to (i) the security interests and
other encumbrances permitted pursuant to the terms of the Note Purchase
Agreement, and (ii) the recording of such instruments of assignment. Such
recordings and filings and all other action necessary or desirable to perfect
and protect such security interest have been duly taken, except for the
Collateral Agent's having possession of instruments and cash constituting
Collateral after the date hereof and the other filings and recordations
described in Section 4(h) hereof.
SECTION 5. Covenants as to the Collateral. So long as any of
the Obligations shall remain outstanding, unless the Collateral Agent shall
otherwise consent in writing:
(a) Further Assurances. Each of the Grantors will at its
expense, at any time and from time to time, promptly execute and deliver all
further instruments and documents and take all further action that may be
necessary or desirable or that the Collateral Agent may request in order (i) to
perfect and protect the security interest purported to be created hereby; (ii)
to enable the Collateral Agent to exercise and enforce its rights and remedies
hereunder in respect of the Collateral; or (iii) otherwise to effect the
purposes of this Agreement, including, without limitation: (A) marking
conspicuously each chattel paper included in the Receivables and each License
and Related Contract and, at the request of the Collateral Agent, each of its
records pertaining to the Collateral with a legend, in form and substance
satisfactory to the Collateral Agent, indicating that such chattel paper,
License, Related Contract or Collateral is subject to the security interest
created hereby, (B) if any Receivable shall be evidenced by a promissory note or
other instrument or chattel paper, delivering and pledging to the Collateral
Agent hereunder such note, instrument or chattel paper duly endorsed and
accompanied by executed instruments of transfer or assignment, all in form and
substance satisfactory to the Collateral Agent, (C) executing and filing such
financing or continuation statements, or amendments thereto, as may be necessary
or desirable or that the Collateral Agent may request in order to perfect and
preserve the security interest purported to be created hereby, and (D)
furnishing to the Collateral 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 Collateral Agent may reasonably request,
all in reasonable detail.
(b) Location of Equipment and Inventory. Each of the Grantors
will keep the Equipment and Inventory (other than used Equipment and Inventory
sold in the ordinary
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course of business in accordance with Section 5(g)) at the locations specified
therefor in Section 4(c), or, upon not less than 30 Business Days' prior written
notice to the Collateral Agent accompanied by a new Schedule IV indicating each
new location of the Equipment and Inventory, at such other locations in the
continental United States as either of the Grantors may elect, provided that (i)
all action has been taken to grant the Collateral Agent a perfected, first
priority security interest in such Equipment and Inventory, and (ii) the
Collateral Agent's rights in such Equipment and Inventory, including, without
limitation, the existence, perfection and priority of the security interest
created hereby in such Equipment and Inventory are not adversely affected.
(c) Condition of Equipment. Each of the Grantors will, at its
expense, cause the Equipment to be maintained and preserved in good repair,
working order and condition, ordinary wear and tear excepted, and will
forthwith, or in the case of any loss or damage to any Equipment as quickly as
practicable after the occurrence thereof, make or cause to be made all of the
appropriate repairs, renewals, replacements and other improvements in connection
therewith which are necessary or desirable or which the Collateral Agent may
request to such end. Each of the Grantors will promptly furnish to the
Collateral Agent a statement describing in reasonable detail any loss or damage
in excess of $100,000 to any Equipment or Inventory.
(d) Taxes, Etc. Each of the Grantors will pay promptly when
due all property and other taxes, assessments and governmental charges or levies
imposed upon, and all claims (including claims for labor, materials and
supplies) against, the Equipment and Inventory, except to the extent the
validity thereof is being contested in good faith by proper proceedings which
stay the imposition of any penalty, fine or lien resulting from the non-payment
thereof and with respect to which adequate reserves in accordance with GAAP,
have been set aside for the payment thereof.
(e) Insurance. (i) Each of the Grantors will, at its own
expense, maintain or cause to be maintained with responsible and reputable
insurance companies or associations insurance (including, without limitation,
comprehensive general liability and property insurance) with respect to the
Equipment and Inventory, in such amounts and covering such risks, as is required
by any Governmental Authority or other regulatory body having jurisdiction with
respect thereto and as is carried generally in accordance with sound business
practice by companies in similar businesses similarly situated and in such form
and with such insurers as shall be satisfactory to the Collateral Agent. Each
policy covering the Collateral shall provide for all losses to be paid on behalf
of the Collateral Agent and each of the Grantors as their respective interests
may appear, and each policy for property damage insurance shall provide for all
losses (except for losses of less than $100,000 per occurrence) to be adjusted
with, and paid directly to, the Collateral Agent. Each such policy shall in
addition (A) name the Grantor and the Collateral Agent as insured parties
thereunder (without any representation or warranty by or obligation upon the
Collateral Agent) as their interests may appear, (B) in the case of each policy
for property damage insurance, name the Collateral Agent as loss payee
thereunder, (C) contain the agreement by the insurer that any loss thereunder
shall be payable to the Collateral Agent on its own account notwithstanding any
action, inaction or breach of representation or warranty by either of the
Grantors, (D) provide that there shall be no recourse against the Collateral
Agent for
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payment of premiums or other amounts with respect thereto, and (E) provide that
at least 30 days' prior written notice of cancellation or of lapse shall be
given to the Collateral Agent by the insurer. Each of the Grantors will, if so
requested by the Collateral Agent, deliver to the Collateral Agent original or
duplicate policies of such insurance and, as often as the Collateral Agent may
reasonably request, a report of a reputable insurance broker with respect to
such insurance. Each of the Grantors will also, at the request of the Collateral
Agent, execute and deliver instruments of assignment of such insurance policies
and cause the respective insurers to acknowledge notice of such assignment.
(ii) Payment under any liability insurance
maintained by either of the Grantors pursuant to this Section 5(e) may be paid
directly to the Person who shall have incurred liability covered by such
insurance. All insurance payments for losses in excess of $100,000 per
occurrence in respect of such Equipment or Inventory, shall be paid to the
Collateral Agent and applied as specified in Section 7(b) hereof.
(f) Provisions Concerning the Receivables, the Related
Contracts and the Licenses.
(i) Each of the Grantors will (A) give the
Collateral Agent at least 30 days' prior written notice of any change in the
Grantor's name, identity or organizational structure, (B) keep its chief place
of business and chief executive office and all originals of all chattel paper
which constitute its Receivables at the location(s) specified therefor in
Schedule IV hereto, and (C) keep adequate records concerning the Receivables and
such chattel paper and permit representatives of the Collateral Agent at
reasonable times and during normal business hours to inspect and make abstracts
from such records and chattel paper in accordance with Section 8.7(b) of the
Note Purchase Agreement.
(ii) Each of the Grantors will duly perform and
observe all of its obligations under each Related Contract and, except as
otherwise provided in this subsection (f), continue to collect, at its own
expense, all amounts due or to become due under the Receivables. In connection
with such collections, the Grantors may (and, at the Collateral Agent's
direction, will) take such action as either of the Grantors or the Collateral
Agent may deem necessary or advisable to enforce collection or performance of
the Receivables; provided, however, that the Collateral Agent shall have the
right at any time, upon the occurrence and during the continuance of an Event of
Default to notify the account debtors or obligors under any such Receivables of
the assignment of such Receivables to the Collateral Agent and to direct such
account debtors or obligors to make payment of all amounts due or to become due
to either of the Grantors thereunder directly to the Collateral Agent or its
designated agent and, upon such notification and at the expense of the Grantors
and to the extent permitted by law, to enforce collection of any such
Receivables and to adjust, settle or compromise the amount or payment thereof,
in the same manner and to the same extent as either of the Grantors might have
done. After receipt by either of the Grantors of a notice from the Collateral
Agent that the Collateral Agent has notified or intends to notify the account
debtors or obligors under any Receivables as referred to in the proviso to the
immediately preceding sentence, then (A) all amounts and proceeds (including
instruments) received by either of the Grantors in respect of any Receivables
shall be received in
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trust for the benefit of the Collateral Agent hereunder, shall be segregated
from other funds of each of the Grantors and shall be forthwith paid over to the
Collateral Agent in the same form as so received (with any necessary
endorsement) to be applied to the Obligations, and (B) the Grantors will not
adjust, settle or compromise the amount or payment of any Receivable or release
in whole or in part any account debtor or obligor thereof or allow any credit or
discount thereon. In addition, upon the occurrence and during the continuance of
an Event of Default, the Collateral Agent shall have the right to notify the
United States Postal Service authorities to change the address for delivery of
mail addressed to each of the Grantors at such address as the Collateral Agent
may designate and to do all other acts and things necessary or desirable to
effect the purposes of this Agreement.
(iii) Upon the occurrence and during the
continuance of any breach or default under any Related Contract or any License
referred to in Schedule II or III hereto by any party thereto other than either
of the Grantors, the Grantors (A) will, promptly after obtaining knowledge of
such breach or default, give the Collateral Agent written notice of the nature
and duration of such breach or default, specifying what action, if any, it has
taken and proposes to take with respect thereto, (B) will not, without the prior
written consent of the Collateral Agent, declare or waive any such breach or
default or affirmatively consent to the cure thereof or exercise any of its
remedies in respect thereof, and (C) will, upon written instructions from the
Collateral Agent and at the Grantors's expense, take such action as the
Collateral Agent may deem necessary or advisable in respect thereof.
(iv) Each of the Grantors will, at its expense,
promptly deliver to the Collateral Agent a copy of each notice or other
communication received by it by which any other party to any Related Contract or
any License referred to in Schedule II or III hereto purports to exercise any of
its rights or affect any of its obligations thereunder, together with a copy of
any reply by either of the Grantors thereto.
(v) Each of the Grantors will exercise promptly
and diligently each and every right which it may have under each License (other
than any right of termination) and will duly perform and observe in all respects
all of its obligations under each License and will take all action necessary to
maintain the Licenses in full force and effect. The Grantors will not, without
the prior written consent of the Collateral Agent, cancel, terminate, amend or
otherwise modify in any respect, or waive any provision of, any Related Contract
or any License referred to in Schedule II or III hereto.
(vi) If any Receivable includes a charge for any
tax payable to any Governmental Authority, the Collateral Agent is hereby
authorized (but in no event obligated) in its discretion to pay the amount
thereof to the proper taxing authority for the account of either of the Grantors
and to charge the Grantors therefor. Each of the Grantors shall notify the
Collateral Agent if any Receivable includes any taxes due to any Governmental
Authority and, in the absence of such notice, the Collateral Agent shall have
the right to retain any proceeds of such Receivable that the Collateral Agent
receives and shall not be liable for any taxes that may be due from either of
the Grantors by reason of the sale and delivery creating such Receivable.
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(g) Transfers and Other Liens.
(i) The Grantors will not sell, assign (by
operation of law or otherwise), lease, exchange or otherwise transfer or dispose
of any of the Collateral except as provided in Section 9.6 of the Note Purchase
Agreement.
(ii) The Grantors will not create or suffer to
exist any Lien, claim, security interest, charge or other encumbrance upon or
with respect to any Collateral except for the security interests permitted
pursuant to the terms of the Note Purchase Agreement.
(h) Trademarks and Patents.
(i) Each of the Grantors has duly executed and
delivered the Assignment for Security (Trademarks) and the Assignment of
Security (Patents) in the forms attached hereto as Exhibits A and B
respectively. Each of the Grantors (either itself or through licensees) will,
and will cause each licensee thereof to, take all action necessary to maintain
all of its Trademarks and Patents in full force and effect, including, without
limitation, using the proper statutory notices and markings and using such
Trademarks on each applicable trademark class of goods in order to so maintain
such Trademarks in full force free from any claim of abandonment for non-use,
and employing all of its Trademarks and Patents with appropriate notice of
registration, and the Grantors will not (and will not permit any licensee
thereof to) do any act or knowingly omit to do any act whereby any Trademark may
become invalidated; provided, however, that so long as no Event of Default has
occurred and is continuing, neither of the Grantors shall have any obligation to
use or to maintain any Trademark or Patent (A) that relates solely to any
product that has been, or is in the process of being, sold, discontinued,
abandoned or terminated, (B) that is being replaced with a trademark or patent
substantially similar to the Trademark or Patent that may be abandoned or
otherwise become invalid, so long as such replacement Trademark or Patent is
subject to the lien created by this Agreement or (C) that is substantially the
same as another Trademark or Patent that is in full force, so long as such other
Trademark or Patent is subject to the lien created by this Agreement. Each of
the Grantors will cause to be taken all necessary steps in any proceeding before
the United States Patent and Trademark Office to maintain each registration of
its Trademarks and the Patents (other than those Trademarks or Patents described
in the proviso to the immediately preceding sentence), including, without
limitation, filing of renewals, affidavits of use, affidavits of
incontestability and opposition, interference and cancellation proceedings and
payment of taxes. If any Trademark or Patent of either of the Grantors is
infringed, misappropriated or diluted in any material respect by a third party,
the Grantor shall (x) upon learning of such infringement, misappropriation or
dilution, promptly notify the Collateral Agent and (y) to the extent that the
Grantor shall deem appropriate under the circumstances, promptly ▇▇▇ for
infringement, misappropriation or dilution, seek injunctive relief where
appropriate and recover any and all damages for such infringement,
misappropriation or dilution, or take such other actions as the Grantor shall
deem appropriate under the circumstances to protect such Trademark or Patent.
Each of the Grantors shall furnish to the Collateral Agent from time to time
(but, unless an Event of Default has occurred and is continuing, no more
frequently than quarterly) statements and schedules further identifying and
describing the Patents and the Trademarks and such other
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reports in connection with the Patents and the Trademarks as the Collateral
Agent may reasonably request, all in reasonable detail, and promptly upon
request of the Collateral Agent, following receipt by the Collateral Agent of
any such statements, schedules or reports, the Grantors shall modify this
Agreement by amending Schedules II or III hereto, as the case may be, to include
any Patent or Trademark which becomes part of the Collateral under this
Agreement. Notwithstanding anything herein to the contrary, upon the occurrence
of an Event of Default or event which, with the giving of notice or the lapse of
time or both, would constitute an Event of Default, the Grantors may not abandon
or otherwise permit a Trademark or Patent to become invalid without the prior
written consent of the Collateral Agent, and if any Trademark or Patent is
infringed, misappropriated or diluted in any material respect by a third party,
each of the Grantors will take such action as the Collateral Agent shall deem
appropriate under the circumstances to protect such Trademark or Patent.
(ii) In no event shall either of the Grantors,
either itself or through any agent, employee, licensee or designee, file an
application for the registration of any trademark or the issuance of any patent
with the United States Patent and Trademark Office, unless it gives the
Collateral Agent prior written notice thereof. Upon request of the Collateral
Agent, each of the Grantors shall execute and deliver any and all assignments,
agreements, instruments, documents and papers as the Collateral Agent may
reasonably request to evidence the Collateral Agent's security interest
hereunder in such trademark or patent and the general intangibles of either of
the Grantors relating thereto or represented thereby, and each of the Grantors
hereby constitutes the Collateral Agent its attorney-in-fact to execute and file
all such writings for the foregoing purposes, all acts of such attorney being
hereby ratified and confirmed, and such power (being coupled with an interest)
shall be irrevocable until the repayment of all of the Obligations in full and
the termination of each of the Note Documents.
(iii) If either of the Grantors shall at any time
own, use or possess the right to use any registered copyright, each of the
Grantors shall promptly notify the Collateral Agent thereof and shall execute
such documents (including any assignment for security of copyrights to be filed
with the United States Copyright Office) and do such acts as shall be necessary
or, in the judgment of the Collateral Agent, desirable to subject such
copyrights to the lien of this Agreement.
(i) Inspection and Reporting. Each of the Grantors shall
permit the Collateral Agent, or any agents or representatives of the Collateral
Agent or such professionals or other Persons as the Collateral Agent may
designate (i) to examine and inspect the books and records of either of the
Grantors and take copies and extracts therefrom, (ii) to verify materials,
leases, notes, receivables, deposit accounts and other assets of either of the
Grantors from time to time, and (iii) to conduct physical Inventory appraisals
and/or valuations, provided that, in the absence of a continuing Event of
Default, all such actions described in clauses (i) through (iii) above shall be
conducted at reasonable times and during normal business hours. In addition,
each of the Grantors shall forward to the Collateral Agent copies of any notices
or communications received or made by either of the Grantors with respect to the
Collateral, all in such manner as the Collateral Agent may reasonably require.
The Borrower shall cause to be conducted physical inventory counts at the times
required in the Note Purchase Agreement.
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SECTION 6. Additional Provisions Concerning the Collateral.
(a) Each of the Grantors hereby authorizes the Collateral
Agent to file, without the signature of the Grantor where permitted by law, one
or more financing or continuation statements, and amendments thereto, relating
to the Collateral.
(b) Each of the Grantors hereby irrevocably appoints the
Collateral Agent or its designee on behalf of the Collateral Agent the Grantor's
attorney-in-fact and proxy, with full authority in the place and stead of the
Grantor and in the name of the Grantor or otherwise, from time to time in the
Collateral Agent's discretion, to take any action and to execute any instrument
which the Collateral Agent may deem necessary or advisable to accomplish the
purposes of this Agreement (subject to the rights of each of the Grantors under
Section 5(f)) including, without limitation, (i) to obtain and adjust insurance
required to be paid to the Collateral Agent pursuant to Section 5(e), (ii) upon
the occurrence of an Event of Default, to ask, demand, collect, ▇▇▇ for,
recover, compound, receive and give acquittance and receipts for moneys due and
to become due under or in respect of any Collateral, (iii) to receive, endorse,
assign and collect any drafts or other instruments, documents and chattel paper
in connection with clause (i) or (ii) above, and (iv) to file any claims or take
any action or institute any proceedings which the Collateral Agent may deem
necessary or desirable for the collection of any Collateral or otherwise to
enforce the rights of the Collateral Agent with respect to any Collateral. All
acts of said attorney or designee are hereby ratified and approved, and said
attorney or designee shall not be liable for any acts of omission or commission
(other than acts or omissions constituting gross negligence or willful
misconduct as determined by a final judgment or a court of competent
jurisdiction), nor for any error of judgment or mistake of fact or law. This
power is coupled with an interest and is irrevocable until all of the
Obligations are paid in full and the Note Purchase Agreement is terminated.
(c) For the purpose of enabling the Collateral Agent to
exercise rights and remedies under this Agreement at such time as the Collateral
Agent shall be lawfully entitled to exercise such rights and remedies, and for
no other purpose, each of the Grantors hereby grants to the Collateral Agent, to
the extent assignable, an irrevocable, non-exclusive license (exercisable
without payment of royalty or other compensation to the Grantors) to use,
assign, license or sublicense any of the Patents or Trademarks now owned or
hereafter acquired by either of the Grantors, wherever the same may be located,
including in such license reasonable access to all media in which any of the
licensed items may be recorded or stored and to all computer programs used for
the compilation or printout thereof. Notwithstanding anything contained herein
to the contrary, but subject to the provisions of the Note Purchase Agreement
that limit the right of the Grantors to dispose of their property, and Section
5(h) of this Agreement, so long as no Event of Default shall have occurred and
be continuing, the Grantors may exploit, use, enjoy, protect, license,
sublicense, assign, sell, dispose of or take other actions with respect to the
Patents or Trademarks in the ordinary course of the business of either of the
Grantors. In furtherance of the foregoing, unless an Event of Default shall have
occurred and be continuing the Collateral Agent shall from time to time, upon
the request of either of the Grantors, execute and deliver any instruments,
certificates or other documents, in the form so requested, which either of the
Grantors shall have certified are appropriate (in its judgment) to allow it to
take any
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action permitted above (including relinquishment of the license provided
pursuant to this clause (c) as to any Patents or Trademarks). Further, upon the
payment in full of all of the Obligations, the Collateral Agent (subject to
Section 11(e)) shall transfer to the Grantors all of the Collateral Agent's
right, title and interest in and to the Patents and Trademarks, and the
Licenses, all without recourse, representation and warranty. The exercise of
rights and remedies hereunder by the Collateral Agent shall not terminate the
rights of the holders of any licenses or sublicenses theretofore granted by
either of the Grantors or granted by either of the Grantors in accordance with
the second sentence of this clause (c). Each of the Grantors hereby releases the
Collateral Agent from any claims, causes of action and demands at any time
arising out of or with respect to any actions taken or omitted to be taken by
the Collateral Agent under the powers of attorney granted herein other than
actions taken or omitted to be taken through the Collateral Agent's gross
negligence or willful misconduct, as determined by a final determination of a
court of competent jurisdiction.
(d) If either of the Grantors fails to perform any agreement
contained herein, the Collateral Agent may itself perform, or cause performance
of, such agreement or obligation, in the name of each of the Grantors or the
Collateral Agent, and the expenses of the Collateral Agent incurred in
connection therewith shall be payable by the Grantors pursuant to Section 8.
(e) The powers conferred on the Collateral Agent hereunder are
solely to protect its interest in the Collateral and shall not impose any duty
upon it to exercise any such powers. Except for the safe custody of any
Collateral in its possession and the accounting for moneys actually received by
it hereunder, the Collateral Agent shall have no duty as to any Collateral or as
to the taking of any necessary steps to preserve rights against prior parties or
any other rights pertaining to any Collateral.
(f) Anything herein to the contrary notwithstanding (i) the
Grantors shall remain liable under the Related Contracts and Licenses and
otherwise with respect to any of the Collateral to the extent set forth therein
to perform all of its obligations thereunder to the same extent as if this
Agreement had not been executed, (ii) the exercise by the Collateral Agent of
any of its rights hereunder shall not release the Grantors from their
obligations under the Related Contracts and Licenses or otherwise in respect of
the Collateral, and (iii) the Collateral Agent shall not have any obligation or
liability by reason of this Agreement under the Related Contracts and Licenses
or with respect to any of the other Collateral, nor shall the Collateral Agent
be obligated to perform any of the obligations or duties of the Grantors
thereunder or to take any action to collect or enforce any claim for payment
assigned hereunder.
SECTION 7. Remedies Upon Default. If any Event of Default
shall have occurred and be continuing:
(a) The Collateral Agent may exercise in respect of the
Collateral, or any part thereof, in addition to other rights and remedies
provided for herein, in the Note Purchase Agreement, the Notes or in the Note
Documents or otherwise available to it, all of the rights and remedies of a
secured party in default under the Code (whether or not the Code applies to the
affected Collateral), and also may (i) take absolute control of the Collateral,
including without
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limitation transfer into the Collateral Agent's name or into the name of its
nominee or nominees (to the extent the Collateral Agent has not theretofore done
so) and thereafter receive, for the benefit of the Collateral Agent, all
payments made thereon, give all consents, waivers and ratifications in respect
thereof and otherwise act with respect thereto as though it were the outright
owner thereof, (ii) require the Grantors to, and each of the Grantors hereby
agrees that it will at its expense and upon request of the Collateral Agent
forthwith, assemble all or part of the Collateral as directed by the Collateral
Agent and make it available to the Collateral Agent at a place or places to be
designated by the Collateral Agent which is reasonably convenient to both
parties, and the Collateral Agent may enter into and occupy any premises owned
or leased by each of the Grantors where the Collateral of any part thereof is
located or assembled for a reasonable period in order to effectuate the
Collateral Agent's rights and remedies hereunder or under law, without
obligation to the Grantors in respect of such occupation, and (iii) without
notice, except as specified below, sell the Collateral or any part thereof in
one or more parcels at public or private sale, at any of the Collateral Agent's
offices or elsewhere, for cash, on credit or for future delivery, and at such
price or prices and upon such other terms as the Collateral Agent may deem
commercially reasonable. Each of the Grantors agrees that, to the extent notice
of sale shall be required by law, at least 10 days' notice to the Grantors of
the time and place of any public sale or the time after which any private sale
is to be made shall constitute reasonable notification. The Collateral Agent
shall not be obligated to make any sale of Collateral regardless of notice of
sale having been given. The Collateral Agent may adjourn any public or private
sale from time to time by announcement at the time and place fixed therefor, and
such sale may, without further notice, be made at the time and place to which it
was so adjourned. Each of the Grantors hereby waives any claims against the
Collateral Agent arising by reason of the fact that the price at which the
Collateral may have been sold at a private sale was less than the price which
might have been obtained at a public sale or was less than the aggregate amount
of the Obligations, even if the Collateral Agent accepts the first offer
received and does not offer the Collateral to more than one offeree and waives
all rights which the Grantors may have to require that all or any part of the
Collateral be marshalled upon any sale (public or private) thereof. In addition
to the foregoing, (i) upon written notice from the Collateral Agent, the
Grantors shall cease any use of the Trademarks or any ▇▇▇▇ similar thereto for
any purpose described in such notice; (ii) the Collateral Agent may, at any time
and from time to time, upon 10 days' prior notice to either of the Grantors,
license, whether general, special or otherwise, and whether on an exclusive or
non-exclusive basis, any of the Trademarks and Patents of either of the
Grantors, throughout the world for such term or terms, on such conditions, and
in such manner, as the Collateral Agent shall in its sole discretion determine;
and (iii) the Collateral Agent may, at any time, pursuant to the authority
granted in Section 6, execute and deliver on behalf of either of the Grantors,
one or more instruments of assignment of the Trademarks and Patents (or any
application or registration thereof), in form suitable for filing, recording or
registration in any country.
(b) Any cash held by the Collateral Agent as Collateral and
all proceeds received by the Collateral Agent in respect of any sale or
collection from, or other realization upon, all or any part of the Collateral,
after payment from such proceeds of the Collateral Agent's out-of-pocket costs
and expenses in connection with such sale, including, without limitation
reasonable attorneys' fees and expenses, may, in the discretion of the
Collateral Agent, be held by
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the Collateral Agent as collateral for, and/or then or at any time thereafter
applied in whole or in part by the Collateral Agent against, all or any part of
the Obligations in such manner as the Collateral Agent may elect in its sole
discretion.
(c) In the event that the proceeds of any such sale,
collection or realization are insufficient to pay all amounts to which the
Collateral Agent are legally entitled, the Grantors shall be liable for the
deficiency, together with interest thereon at the Default Rate or such other
rate as shall be fixed by applicable law, together with the costs of collection
and the reasonable fees, costs, expenses and other client charges of any
attorneys employed by the Collateral Agent to collect such deficiency.
(d) The Collateral Agent may employ and maintain in the
premises of the Grantors one or more custodians selected by the Collateral Agent
who shall have full authority to do all acts necessary or desirable to protect
the Collateral Agent's interests hereunder. The Grantors hereby agree to
cooperate with any such custodian and to do whatever the Collateral Agent may
reasonably request to preserve the Collateral. All costs and expenses incurred
by the Collateral Agent, by reason of the employment of the custodian, shall be
payable the Grantors pursuant to Section 8.
SECTION 8. Indemnity and Expenses.
(a) The Grantors agrees to indemnify and hold the Collateral
Agent, its Affiliates and each officer, director and agent of the Collateral
Agent or any of its Affiliates (the "Indemnitees") harmless from and against any
and all claims, damages, losses, liabilities, obligations, penalties, costs or
expenses (including, without limitation, reasonable legal fees, costs, expenses
and other client charges) to the extent that they arise out of or otherwise
result from this Agreement (including, without limitation, enforcement of this
Agreement), except claims, losses or liabilities resulting solely and directly
from an Indemnitee's gross negligence or willful misconduct as determined by a
final determination of a court of competent jurisdiction.
(b) Without limiting the generality of the foregoing, the
Grantors will upon demand pay to each Indemnitee (i) the amount of any and all
costs and expenses, including the reasonable fees, costs, expenses and other
client charges of counsel for such Indemnitee and of any experts and agents
(including, without limitation, any Person which may act as agent of such
Indemnitee), which such Indemnitee may incur in connection with (A) the
preparation, negotiation, execution, delivery, recordation, administration,
amendment, waiver or other modification or termination of this Agreement, or (B)
the custody, preservation, use or operation of the Collateral and (ii) the
amount of any and all costs and expenses, including the reasonable fees, costs,
expenses and other client charges of counsel for such Indemnitee and of any
experts and agents (including, without limitation, any Person which may act as
agent of such Indemnitee), which such Indemnitee may incur in connection with
(A) the sale of, collection from, or other realization upon, any Collateral, (B)
the exercise or enforcement of any of the rights of such Indemnitee hereunder,
or (C) the failure by either of the Grantors to perform or observe any of the
provisions hereof.
SECTION 9. Notices, Etc. All notices and other communications
provided for
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hereunder shall be in writing and shall be mailed, telecopied or delivered, if
to the Grantors, to them at the addresses specified in the Note Purchase
Agreement; and if to the Collateral Agent, to it at its address specified in the
Note Purchase Agreement; or as to any such Person at such other address as shall
be designated by such Person in a written notice to such other person complying
as to delivery with the terms of this Section 9. All such notices and other
communications shall be effective (i) if mailed, when received or three Business
Days after deposited in the mail, whichever first occurs (ii) if telecopied,
when transmitted and a confirmation is received, or (iii) if delivered, upon
delivery.
SECTION 10. Miscellaneous.
(a) No amendment of any provision of this Agreement shall be
effective unless it is in writing and signed by the Grantors and the Collateral
Agent, and no waiver of any provision of this Agreement, and no consent to any
departure by the Grantors therefrom, shall be effective unless it is in writing
and signed by the Collateral Agent, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.
(b) No failure on the part of the Collateral Agent to
exercise, and no delay in exercising, any right hereunder or under any other
Note Document shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right preclude any other or further exercise thereof or the
exercise of any other right. The rights and remedies of the Collateral Agent
provided herein and in the other Note Documents are cumulative and are in
addition to, and not exclusive of, any rights or remedies provided by law. The
rights of the Collateral Agent under any Note Document against any party thereto
are not conditional or contingent on any attempt by the Collateral Agent to
exercise any of its rights under any other Note Document against such party or
against any other Person.
(c) 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 portions hereof or thereof or affecting the validity or enforceability
of such provision in any other jurisdiction.
(d) This Agreement shall create a continuing security interest
in the Collateral and shall (i) remain in full force and effect until the
payment in full or release of the Obligations and the termination of the Note
Purchase Agreement; and (ii) be binding on the Grantors, their successors and
assigns, except that the Grantors may not assign or transfer any of their rights
hereunder without the prior written consent of the Collateral Agent, and shall
inure, together with all rights and remedies of the Collateral Agent hereunder,
to the benefit of the Collateral Agent and its permitted successors, transferees
and assigns. Without limiting the generality of clause (ii) of the immediately
preceding sentence, without notice to the Grantors, the Collateral Agent may
assign or otherwise transfer its rights under this Agreement and any other Note
Document, to any other Person pursuant to the terms of the Note Purchase
Agreement and such other Person shall thereupon become vested with all of the
benefits in respect thereof granted to the Collateral Agent herein or otherwise.
Upon any such assignment or transfer, all references in this
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Agreement to the Collateral Agent shall mean the assignee of the Collateral
Agent. None of the rights or obligations of the Grantors hereunder may be
assigned or otherwise transferred without the prior written consent of the
Collateral Agent, and any such assignment or transfer shall be null and void.
(e) Upon the satisfaction in full of the Obligations and the
termination of the Note Purchase Agreement, (i) this Agreement and the security
interests created hereby shall terminate and all rights to the Collateral shall
revert to the Grantors and (ii) the Collateral Agent will, upon either of the
Grantor's request and at the requesting Grantor's cost and expense, (A) return
to the Grantor(s) such of the Collateral as shall not have been sold or
otherwise disposed of or applied pursuant to the terms hereof and (B) execute
and deliver to the Grantors such documents as the Grantors shall reasonably
request to evidence such termination, all without any representation, warranty
or recourse whatsoever.
(f) This Agreement shall be governed by and construed in
accordance with the law of the State of New York, except to the extent that the
validity and perfection or the perfection and the effect of perfection or
non-perfection of the security interest created hereby, or remedies hereunder,
in respect of any particular Collateral are governed by the law of a
jurisdiction other than the State of New York.
(g) This Agreement supersedes all prior understandings and
agreements, whether written or oral, among the parties hereto relating to the
transactions provided for herein.
(h) All representations and warranties of the Grantors
contained herein or made in connection herewith shall survive the making of and
shall not be waived by the execution and delivery of this Agreement, the Note
Purchase Agreement, the Notes or any other Note Document, any investigation by
the Collateral Agent or the purchasing of the Notes. All covenants and
agreements of the Grantors contained herein shall continue in full force and
effect from and after the date hereof until the indefeasible payment in full of
the Obligations.
(i) Section headings in this Agreement are included herein for
the convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
(j) BY ITS EXECUTION AND DELIVERY OF THIS AGREEMENT, THE
GRANTORS HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS EITHER
OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON,
OR ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS AGREEMENT, THE NOTE
PURCHASE AGREEMENT, THE NOTES OR ANY OTHER NOTE DOCUMENT, ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE COLLATERAL
AGENT OR EITHER OF THE GRANTORS IN CONNECTION HEREWITH OR THEREWITH. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE COLLATERAL AGENT TO ENTER INTO THIS
AGREEMENT.
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IN WITNESS WHEREOF, the Grantors have caused this Agreement to
be executed and delivered by its officer thereunto duly authorized as of the
date first above written.
FIRST NEW ENGLAND DENTAL CENTERS, INC.
By: _________________________________
Name:
Title:
▇▇▇▇▇▇ AND ▇▇▇▇▇▇, D.M.D., P.C.
By:__________________________________
Name:
Title:
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Accepted and Agreed:
IMPRIMIS INVESTORS LLC, not in its individual capacity but solely as Collateral
Agent
By: ________________________________
Name:
Title:
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Schedule I
RELATED CONTRACTS
22
Schedule II
TRADEMARKS
AND
TRADEMARK LICENSES
23
Schedule III
PATENTS AND PATENT LICENSES
24
Schedule IV
ADDRESSES OF GRANTORS
Chief Place of Business,
Chief Executive Office
A. and Location of Records
B. Locations of
Equipment and Inventory
25
Schedule V
TRADENAMES
26
Schedule VI
UCC-1 FINANCING STATEMENTS
27
EXHIBIT A
ASSIGNMENT FOR SECURITY
(TRADEMARKS)
WHEREAS, _____________________ (the "Assignor") holds all
right, title and interest in the trademarks listed on the annexed Schedule 1A,
which trademarks are issued or applied for in the United States Patent and
Trademark Office (the "Trademarks");
WHEREAS, the Assignor has entered into a Security Agreement
dated July 24, 1997 (the "Security Agreement") in favor of Imprimis Investors
LLC (the "Assignee");
WHEREAS, pursuant to the Security Agreement, the Assignor has
assigned to the Assignee and granted to the Assignee a security interest in all
right, title and interest of the Assignor in, to and under the Trademarks and
the applications and registrations thereof, and all proceeds thereof, including,
without limitation, any and all causes of action which may exist by reason of
infringement thereof (the "Collateral"), to secure the payment, performance and
observance of the Obligations (as defined in the Security Agreement);
NOW, THEREFORE, for good and valuable consideration, receipt
of which is hereby acknowledged, the Assignor does hereby convey, sell, assign,
transfer and set over unto the Assignee and grants to the Assignee a security
interest in the Collateral to secure the prompt payment, performance and
observance of the Obligations.
The Assignor does hereby further acknowledge and affirm that
the rights and remedies of the Assignee with respect to the Collateral are more
fully set forth in the Security Agreement, the terms and provisions of which are
hereby incorporated herein by reference as if fully set forth herein.
IN WITNESS WHEREOF, the Assignor has caused this Assignment to
be duly executed by its officer thereunto duly authorized as of July 24, 1997.
NAME OF COMPANY
By: _____________________________
Name:________________________
Title:_______________________
28
STATE OF ___________
ss.:
COUNTY OF _________
On this 24th day of July, 1997 before me personally came
________________, to me known to be the person who executed the foregoing
instrument, and who, being duly sworn by me, did depose and say that he is the
________________ of _________________________, a ________ corporation, and that
he executed the foregoing instrument in the name of
________________________________, and that he had authority to sign the same,
and he acknowledged to me that he executed the same as the act and deed of said
company for the uses and purposes therein mentioned.
___________________________________
29
EXHIBIT B
ASSIGNMENT FOR SECURITY
(PATENTS)
WHEREAS, _____________________ (the "Assignor") holds all
right, title and interest in the letter patents, design patents and utility
patents listed on the annexed Schedule 1A, which patents are issued or applied
for in the United States Patent and Trademark Office (the "Patents");
WHEREAS, the Assignor has entered into a Security Agreement
dated July 24, 1997 (the "Security Agreement") in favor of Imprimis Investors
LLC (the "Assignee");
WHEREAS, pursuant to the Security Agreement, the Assignor has
assigned to the Assignee and granted to the Assignee a security interest in all
right, title and interest of the Assignor in, to and under the Patents and the
applications and registrations thereof, and all proceeds thereof, including,
without limitation, any and all causes of action which may exist by reason of
infringement thereof (the "Collateral"), to secure the payment, performance and
observance of the Obligations (as defined in the Security Agreement);
NOW, THEREFORE, for good and valuable consideration, receipt
of which is hereby acknowledged, the Assignor does hereby convey, sell, assign,
transfer and set over unto the Assignee and grants to the Assignee a security
interest in the Collateral to secure the prompt payment, performance and
observance of the Obligations.
The Assignor does hereby further acknowledge and affirm that
the rights and remedies of the Assignee with respect to the Collateral are more
fully set forth in the Security Agreement, the terms and provisions of which are
hereby incorporated herein by reference as if fully set forth herein.
IN WITNESS WHEREOF, the Assignor has caused this Assignment to
be duly executed by its officer thereunto duly authorized as of July 24, 1997.
NAME OF COMPANY
By: ______________________________
Name:_________________________
Title:________________________
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STATE OF ___________
ss.:
COUNTY OF _________
On this 24th day of July, 1997 before me personally came
________________, to me known to be the person who executed the foregoing
instrument, and who, being duly sworn by me, did depose and say that he is the
________________ of _________________________, a ________ corporation, and that
he executed the foregoing instrument in the name of
________________________________, and that he had authority to sign the same,
and he acknowledged to me that he executed the same as the act and deed of said
company for the uses and purposes therein mentioned.
_____________________________________
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SCHEDULE 1A TO ASSIGNMENT FOR SECURITY
(PATENTS AND PATENT APPLICATIONS)