EXHIBIT H
[CONFORMED
AS EXECUTED]
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SECURITY AGREEMENT
among
TRISTAR AEROSPACE CO.,
AEROSPACE ACQUISITION CORP.,
TRISTAR AEROSPACE, INC.,
STANDARD PARTS AND EQUIPMENT CORPORATION,
VARIOUS LENDING INSTITUTIONS,
and
BANKERS TRUST COMPANY,
AS AGENT
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Dated as of March 24, 1999
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TABLE OF CONTENTS
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ARTICLE I
SECURITY INTERESTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
1.1. Grant of Security Interests. . . . . . . . . . . . . . . . . . . . .2
1.2. Power of Attorney. . . . . . . . . . . . . . . . . . . . . . . . . .3
ARTICLE II
GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS. . . . . . . . . . . . . . . . . .3
2.1. Necessary Filings. . . . . . . . . . . . . . . . . . . . . . . . . .3
2.2. No Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
2.3. Other Financing Statements . . . . . . . . . . . . . . . . . . . . .4
2.4. Chief Executive Office; Records. . . . . . . . . . . . . . . . . . .4
2.5. Location of Inventory and Equipment. . . . . . . . . . . . . . . . .5
2.6. Recourse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
2.7. Trade Names; Change of Name. . . . . . . . . . . . . . . . . . . . .5
ARTICLE III
SPECIAL PROVISIONS CONCERNING
RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS. . . . . . . . . . . . . . . . . . . . . .6
3.1. Additional Representations and Warranties. . . . . . . . . . . . . .6
3.2. Maintenance of Records . . . . . . . . . . . . . . . . . . . . . . .6
3.3. Direction to Account Debtors; Contracting Parties; etc.. . . . . . .7
3.4. Modification of Terms; etc.. . . . . . . . . . . . . . . . . . . . .7
3.5. Collection . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
3.6. Instruments. . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
3.7. Further Actions. . . . . . . . . . . . . . . . . . . . . . . . . . .7
ARTICLE IV
SPECIAL PROVISIONS CONCERNING TRADEMARKS . . . . . . . . . . . . . . . . . . . . . .8
4.1. Additional Representations and Warranties. . . . . . . . . . . . . .8
4.2. Licenses and Assignments . . . . . . . . . . . . . . . . . . . . . .8
(i)
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4.3. Infringements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
4.4. Preservation of Marks. . . . . . . . . . . . . . . . . . . . . . . .9
4.5. Maintenance of Registration. . . . . . . . . . . . . . . . . . . . . . . . . .9
4.6. Future Registered Marks. . . . . . . . . . . . . . . . . . . . . . .9
4.7. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
ARTICLE V
SPECIAL PROVISIONS CONCERNING
PATENTS, COPYRIGHTS AND TRADE SECRETS. . . . . . . . . . . . . . . . . . 10
5.1. Additional Representations and Warranties. . . . . . . . . . . . . 10
5.2. Licenses and Assignments . . . . . . . . . . . . . . . . . . . . . 11
5.3. Infringements. . . . . . . . . . . . . . . . . . . . . . . . . . . 11
5.4. Maintenance of Patents and Copyrights. . . . . . . . . . . . . . . 11
5.5. Prosecution of Patent or Copyright Application . . . . . . . . . . 11
5.6. Other Patents and Copyrights . . . . . . . . . . . . . . . . . . . 11
5.7. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
ARTICLE VI
PROVISIONS CONCERNING ALL COLLATERAL . . . . . . . . . . . . . . . . . . . . . . . 12
6.1. Protection of Collateral Agent's Security. . . . . . . . . . . . . 12
6.2. Warehouse Receipts Non-negotiable. . . . . . . . . . . . . . . . . 12
6.3. Further Actions. . . . . . . . . . . . . . . . . . . . . . . . . . 12
6.4. Financing Statements . . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE VII
REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT . . . . . . . . . . . . . . . . . . . 13
7.1. Remedies; Obtaining the Collateral Upon Default. . . . . . . . . . 13
7.2. Remedies; Disposition of the Collateral. . . . . . . . . . . . . . 14
7.3. Waiver of Claims . . . . . . . . . . . . . . . . . . . . . . . . . 15
7.4. Application of Proceeds. . . . . . . . . . . . . . . . . . . . . . 15
7.5. Remedies Cumulative. . . . . . . . . . . . . . . . . . . . . . . . 18
7.6. Discontinuance of Proceedings. . . . . . . . . . . . . . . . . . . 18
ARTICLE VIII
INDEMNITY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(ii)
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8.1. Indemnity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
8.2. Indemnity Obligations Secured by Collateral; Survival. . . . . . . 19
ARTICLE IX
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE X
MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
10.1. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
10.2. Waiver; Amendment . . . . . . . . . . . . . . . . . . . . . . . . 25
10.3. Obligations Absolute. . . . . . . . . . . . . . . . . . . . . . . 25
10.4. Successors and Assigns. . . . . . . . . . . . . . . . . . . . . . . . . . . 26
10.5. Headings Descriptive. . . . . . . . . . . . . . . . . . . . . . . 26
10.6. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . 26
10.7. Assignor's Duties . . . . . . . . . . . . . . . . . . . . . . . . 26
10.8. Termination; Release. . . . . . . . . . . . . . . . . . . . . . . 26
10.9. Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . . 27
10.10. The Collateral Agent . . . . . . . . . . . . . . . . . . . . . . 27
10.11. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . 27
10.12. Limited Obligations. . . . . . . . . . . . . . . . . . . . . . . 27
10.13. Additional Assignors . . . . . . . . . . . . . . . . . . . . . . 28
ANNEX A Schedule of Chief Executive Offices/Record Locations
ANNEX B Schedule of Inventory and Equipment Locations
ANNEX C Schedule of Trade, Fictitious and Other Names
ANNEX D Schedule of Marks
ANNEX E Schedule of Patents and Applications
ANNEX F Schedule of Copyrights and Applications
ANNEX G Assignment of Security Interest in Patents and Trademarks
ANNEX H Assignment of Security Interest in Copyrights
(iii)
EXHIBIT H
SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of March 24, 1999 (as amended, modified
or supplemented from time to time, this "Agreement"), among each of the
undersigned assignors (each, an "Assignor" and, together with each other entity
that is required to execute a counterpart hereof pursuant to Section 10.13
hereof, the "Assignors") and BANKERS TRUST COMPANY, as Collateral Agent (the
"Collateral Agent"), for the benefit of the Secured Creditors (as defined
below). Except as otherwise defined herein, terms used herein and defined in
the Agreement (as defined below) shall be used herein as therein defined.
W I T N E S S E T H :
WHEREAS, TriStar Aerospace, Co. ("Parent"), Aerospace Acquisition
Corp. ("Holdings"), TriStar Aerospace Inc. (the "US Borrower"), TriStar
Aerospace SARL (the "French Borrower"and together with the US Borrower, the
"Borrowers), various financial institutions from time to time party thereto (the
"Banks") and Bankers Trust Company, as Agent (the "Agent", and together with the
Banks and the Collateral Agent, the "Bank Creditors"), have entered into an
Amended and Restated Credit Agreement, dated as of March 24, 1999, providing for
the making of Loans to the Borrowers and the issuance of, and participation in,
Letters of Credit for the account of the US Borrower as contemplated therein (as
used herein, the term "Credit Agreement" means the Amended and Restated Credit
Agreement described above in this paragraph as amended, modified, extended,
renewed, replaced, restated, supplemented, restructured or refinanced from time
to time, and including any agreement extending the maturity of, refinancing or
restructuring (including, but not limited to, the inclusion of additional
borrowers thereunder or any increase in the amount borrowed) all, or any portion
of, the Indebtedness under such agreement or any successor agreements);
WHEREAS, any Assignor may from time to time enter into, or guaranty
the obligations of any other Assignor under, one or more (i) interest rate
protection agreements (including, without limitation, interest rate swaps, caps,
floors, collars and similar agreements), (ii) foreign exchange contracts,
currency swap agreements or other similar agreements or arrangements designed to
protect against the fluctuations in currency values and/or (iii) other types of
hedging agreements from time to time (each such agreement or arrangement with an
Other Creditor (as hereinafter defined), an "Interest Rate Protection Agreement
or Other Hedging Agreement"), with any Bank, any affiliate thereof or a
syndicate of financial institutions organized by any such Bank or affiliate (any
such Bank or affiliate (even if any such Bank ceases to be a Bank under the
Credit Agreement for any reason) and any such other institution that
participates in such Interest Rate Protection Agreements or Other Hedging
Agreements and their subsequent successors and assigns collectively, the "Other
Creditors", and together with the Bank Creditors, the "Secured Creditors");
WHEREAS, pursuant to Section 14 of the Credit Agreement, Parent,
Holdings and (with respect to the Obligations of the French Borrower only) the
US Borrower have provided a joint and several guaranty of the payment when due
of all obligations and liabilities of
EXHIBIT H
PAGE 2
the Borrowers under and in connection with the Credit Documents and each
Interest Rate Protection Agreement or Other Hedging Agreement entered into
with one or more Other Creditors;
WHEREAS, pursuant to the Subsidiaries Guaranty, the Subsidiary
Guarantors have jointly and severally guaranteed the payment when due of all
obligations and liabilities of the Borrowers under or with respect to the Credit
Documents and each Interest Rate Protection Agreement or Other Hedging Agreement
entered into with one or more Other Creditors;
WHEREAS, it is a condition precedent to the making of Loans to the
Borrowers and the issuance of, and participation in, Letters of Credit for the
account of the US Borrower under the Amended and Restated Credit Agreement and
to the Other Creditors entering into Interest Rate Protection Agreements or
Other Hedging Agreements that each Assignor shall have executed and delivered to
the Collateral Agent this Agreement; and
WHEREAS, each Assignor desires to execute this Agreement to satisfy
the condition described in the preceding paragraph;
NOW, THEREFORE, in consideration of the benefits accruing to each
Assignor, the receipt and sufficiency of which are hereby acknowledged, each
Assignor hereby makes the following representations and warranties to the
Collateral Agent and hereby covenants and agrees with the Collateral Agent as
follows:
ARTICLE I
SECURITY INTERESTS
1.1. GRANT OF SECURITY INTERESTS. (a) As security for the prompt
and complete payment and performance when due of all Obligations of such
Assignor, each Assignor does hereby assign and transfer unto the Collateral
Agent, and does hereby pledge and grant to the Collateral Agent for the benefit
of the Secured Creditors, a continuing security interest of first priority in,
all of the right, title and interest of such Assignor in, to and under all of
the following, whether now existing or hereafter from time to time acquired:
(i) each and every Receivable;
(ii) all Contracts, together with all Contract Rights arising
thereunder;
(iii) all Inventory;
(iv) the Cash Collateral Account and any other cash collateral
account established for any Assignor and all moneys, securities and
instruments deposited or required to be deposited in such Cash Collateral
Account;
(v) all Equipment;
EXHIBIT H
PAGE 3
(vi) all Marks, together with the registrations and right to all
renewals thereof, and the goodwill of the business of such Assignor
symbolized by the Marks;
(vii) all Patents and Copyrights and all reissues, renewals and
extensions thereof;
(viii) all computer programs of such Assignor and all intellectual
property rights therein and all other proprietary information of such
Assignor, including, but not limited to, trade secrets and Trade Secret
Rights;
(ix) all insurance policies;
(x) all other Goods, General Intangibles, Chattel Paper, Documents
and Instruments and other assets of such Assignor (other than the Pledged
Securities); and
(x) all Proceeds and products of any and all of the foregoing (all
of the above, collectively, the "Collateral").
(b) The security interest of the Collateral Agent under this
Agreement extends to all Collateral of the kind which is the subject of this
Agreement which any Assignor may acquire at any time during the continuation of
this Agreement.
1.2. POWER OF ATTORNEY. Each Assignor hereby constitutes and
appoints the Collateral Agent its true and lawful attorney, irrevocably, with
full power after the occurrence of and during the continuance of an Event of
Default (in the name of such Assignor or otherwise) to act, require, demand,
receive, compound and give acquittance for any and all monies and claims for
monies due or to become due to such Assignor under or arising out of the
Collateral, to endorse any checks or other instruments or orders in connection
therewith and to file any claims or take any action or institute any proceedings
which the Collateral Agent may deem to be necessary or advisable to accomplish
the purposes of this Agreement, which appointment as attorney is coupled with an
interest.
ARTICLE II
GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS
Each Assignor represents, warrants and covenants, which
representations, warranties and covenants shall survive execution and delivery
of this Agreement, as follows:
2.1. NECESSARY FILINGS. All filings, registrations and recordings
necessary or appropriate to create, preserve, protect and perfect the security
interest granted by such Assignor to the Collateral Agent hereby in respect of
the Collateral have been accomplished and the security interest granted to the
Collateral Agent pursuant to this Agreement in and to the Collateral constitutes
a perfected security interest therein prior to the rights of all other Persons
therein and subject to no other Liens (other than Permitted Liens) and is
entitled to all the rights, priorities and benefits afforded by the
EXHIBIT H
PAGE 4
Uniform Commercial Code or other relevant law as enacted in any relevant
jurisdiction to perfected security interests.
2.2. NO LIENS. Such Assignor is, and as to Collateral acquired by it
from time to time after the date hereof such Assignor will be, the owner of all
Collateral free from any Lien, security interest, encumbrance or other right,
title or interest of any Person (other than Permitted Liens and Liens created
under this Agreement) and such Assignor shall defend the Collateral against all
claims and demands of all Persons at any time claiming the same or any interest
therein adverse to the Collateral Agent.
2.3. OTHER FINANCING STATEMENTS. As of the date hereof, there is no
financing statement (or similar statement or instrument of registration under
the law of any jurisdiction) covering or purporting to cover any interest of any
kind in the Collateral (other than (x) those created under this Agreement and
(y) as may be filed in connection with Liens permitted pursuant to Section
9.01(iii) of the Credit Agreement), and so long as the Total Commitment has not
been terminated or any Note or Letter of Credit remains outstanding or any of
the Obligations remain unpaid or any Interest Rate Protection Agreement or Other
Hedging Agreement remains in effect or any Obligations are owed with respect
thereto, such Assignor will not execute or authorize to be filed in any public
office any financing statement (or similar statement or instrument of
registration under the law of any jurisdiction) or statements relating to the
Collateral, except financing statements filed or to be filed in respect of and
covering the security interests granted hereby by such Assignor or as permitted
by the Credit Agreement.
2.4. CHIEF EXECUTIVE OFFICE; RECORDS. The chief executive office of
such Assignor is located at the address or addresses indicated on Annex A
hereto. Such Assignor will not move its chief executive office except to such
new location as such Assignor may establish in accordance with the last sentence
of this Section 2.4. The originals of all documents evidencing all Receivables
and Contract Rights and Trade Secret Rights of such Assignor and the only
original books of account and records of such Assignor relating thereto are, and
will continue to be, kept at such chief executive office or at such new
locations as such Assignor may establish in accordance with the last sentence of
this Section 2.4. All Receivables and Contract Rights and Trade Secret Rights
of such Assignor are, and will continue to be, maintained at, and controlled and
directed (including, without limitation, for general accounting purposes) from,
the office locations described above or such new location established in
accordance with the last sentence of this Section 2.4. No Assignor shall
establish new locations for such offices until (i) it shall have given to the
Collateral Agent not less than 30 days' prior written notice of its intention to
do so, clearly describing such new location and providing such other information
in connection therewith as the Collateral Agent may reasonably request,
(ii) with respect to such new location, it shall have taken all action,
satisfactory to the Collateral Agent, to maintain the security interest of the
Collateral Agent in the Collateral intended to be granted hereby at all times
fully perfected and in full force and effect, (iii) at the request of the
Collateral Agent, it shall have furnished an opinion of counsel acceptable to
the Collateral Agent to the effect that all financing or continuation statements
and amendments or supplements thereto have been filed in the appropriate filing
office or offices, and (iv) the Collateral Agent shall have received evidence
that all other actions (including, without limitation, the payment of all filing
fees and taxes, if any, payable in
EXHIBIT H
PAGE 5
connection with such filings) have been taken, in order to perfect (and
maintain the perfection and priority of) the security interest granted hereby.
2.5. LOCATION OF INVENTORY AND EQUIPMENT. All Inventory and
Equipment held on the date hereof by each Assignor is located at one of the
locations shown on Annex B hereto. Each Assignor agrees that all Inventory and
Equipment now held or subsequently acquired by it shall be kept at (or shall be
in transport to) any one of the locations shown on Annex B hereto, or such new
location as such Assignor may establish in accordance with the last sentence of
this Section 2.5, except as permitted to be sold in accordance with the terms
hereof and in the Credit Agreement. Any Assignor may establish a new location
for Inventory and Equipment only if (i) it shall have given to the Collateral
Agent not less than 30 days prior written notice of its intention so to do,
clearly describing such new location and providing such other information in
connection therewith as the Collateral Agent may reasonably request, (ii) with
respect to such new location, it shall have taken all action satisfactory to the
Collateral Agent to maintain the security interest of the Collateral Agent in
the Collateral intended to be granted hereby at all times fully perfected and in
full force and effect, (iii) at the request of the Collateral Agent, it shall
have furnished an opinion of counsel acceptable to the Collateral Agent to the
effect that all financing or continuation statements and amendments or
supplements thereto have been filed in the appropriate filing office or offices,
and (iv) the Collateral Agent shall have received evidence that all other
actions (including, without limitation, the payment of all filing fees and
taxes, if any, payable in connection with such filings) have been taken, in
order to perfect (and maintain the perfection and priority of) the security
interest granted hereby.
2.6. RECOURSE. This Agreement is made with full recourse to each
Assignor and pursuant to and upon all the warranties, representations, covenants
and agreements on the part of such Assignor contained herein, in the other
Credit Documents, in the Interest Rate Protection Agreements or Other Hedging
Agreements and otherwise in writing in connection herewith or therewith.
2.7. TRADE NAMES; CHANGE OF NAME. No Assignor has or operates in any
jurisdiction under, or previously has had or has operated in any jurisdiction
within the five year period preceding the date of this Agreement under, any
trade names, fictitious names or other names except its legal name and such
other trade or fictitious names as are listed on Annex C hereto. No Assignor
shall change its legal name or assume or operate in any jurisdiction under any
trade, fictitious or other name except those names listed on Annex C hereto in
the jurisdictions listed with respect to such names and new names (including,
without limitation, any names of divisions or operations) and/or jurisdictions
established in accordance with the last sentence of this Section 2.7. No
Assignor shall assume or operate in any jurisdiction under any new trade,
fictitious or other name or operate under any existing name in any additional
jurisdiction until (i) it shall have given to the Collateral Agent not less than
30 days' prior written notice of its intention so to do, clearly describing such
new name and/or jurisdiction and, in the case of a new name, the jurisdictions
in which such new name shall be used and providing such other information in
connection therewith as the Collateral Agent may reasonably request, (ii) with
respect to such new name and/or jurisdiction, it shall have taken all action to
maintain the security interest of the Collateral Agent in the Collateral
intended to be granted hereby at all times fully perfected and in full force and
effect, (iii) at the request of the Collateral Agent, it shall have
EXHIBIT H
PAGE 6
furnished an opinion of counsel acceptable to the Collateral Agent to the
effect that all financing or continuation statements and amendments or
supplements thereto have been filed in the appropriate filing office or
offices, and (iv) the Collateral Agent shall have received evidence that all
other actions (including, without limitation, the payment of all filing fees
and taxes, if any, payable in connection with such filings) have been taken,
in order to perfect (and maintain the perfection and priority of) the
security interest granted hereby.
ARTICLE III
SPECIAL PROVISIONS CONCERNING
RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS
3.1. ADDITIONAL REPRESENTATIONS AND WARRANTIES. As of the time when
each of its Receivables arises, each Assignor shall be deemed to have
represented and warranted that such Receivable, and all records, papers and
documents relating thereto (if any) are genuine and in all respects what they
purport to be, and that all papers and documents (if any) relating thereto
(i) will represent the genuine legal, valid and binding obligation of the
account debtor evidencing indebtedness unpaid and owed by the respective account
debtor arising out of the performance of labor or services or the sale or lease
and delivery of the inventory, materials, equipment or merchandise listed
therein, or both, (ii) will be the only original writings evidencing and
embodying such obligation of the account debtor named therein (other than copies
created for general accounting purposes), (iii) will evidence true and valid
obligations, enforceable in accordance with their respective terms except to the
extent provided in Section 3.5 and (iv) will be in compliance and will conform
in all material respects with all applicable federal, state and local laws and
applicable laws of any relevant foreign jurisdiction.
3.2. MAINTENANCE OF RECORDS. Each Assignor will keep and maintain at
its own cost and expense satisfactory and complete records of its Receivables
and Contracts, including, but not limited to, originals or copies of all
documentation (including each Contract) with respect thereto, records of all
payments received, all credits granted thereon, all merchandise returned and all
other dealings therewith, and such Assignor will make the same available on such
Assignor's premises to the Collateral Agent for inspection, at such Assignor's
own cost and expense, at any and all reasonable times and intervals as the
Collateral Agent may request. Upon the occurrence and during the continuance of
an Event of Default and at the request of the Collateral Agent, such Assignor
shall, at its own cost and expense, deliver all tangible evidence of its
Receivables and Contract Rights (including, without limitation, all documents
evidencing the Receivables and all Contracts) and such books and records to the
Collateral Agent or to its representatives (copies of which evidence and books
and records may be retained by such Assignor). If the Collateral Agent so
directs, such Assignor shall legend, in form and manner satisfactory to the
Collateral Agent, the Receivables and the Contracts, as well as books, records
and documents of such Assignor evidencing or pertaining to such Receivables and
Contracts with an appropriate reference to the fact that such Receivables and
Contracts have been assigned to the Collateral Agent and that the Collateral
Agent has a security interest therein.
EXHIBIT H
PAGE 7
3.3. DIRECTION TO ACCOUNT DEBTORS; CONTRACTING PARTIES; ETC. Upon
the occurrence and during the continuance of an Event of Default, and if the
Collateral Agent so directs any Assignor, such Assignor agrees (x) to cause all
payments on account of the Receivables and Contracts to be made directly to the
Cash Collateral Account, (y) that the Collateral Agent may, at its option,
directly notify the obligors with respect to any Receivables and/or under any
Contracts to make payments with respect thereto as provided in preceding clause
(x), and (z) that the Collateral Agent may enforce collection of any such
Receivables and Contracts and may adjust, settle or compromise the amount of
payment thereof, in the same manner and to the same extent as such Assignor.
Without notice to or assent by any Assignor, the Collateral Agent may apply any
or all amounts then in, or thereafter deposited in, the Cash Collateral Account
which application shall be effected in the manner provided in Section 7.4 of
this Agreement. The costs and expenses (including attorneys' fees) of
collection, whether incurred by the Assignor or the Collateral Agent, shall be
borne by the relevant Assignor.
3.4. MODIFICATION OF TERMS; ETC. No Assignor shall rescind or cancel
any indebtedness evidenced by any Receivable or under any Contract, or modify
any term thereof or make any adjustment with respect thereto, or extend or renew
the same, or compromise or settle any material dispute, claim, suit or legal
proceeding relating thereto, or sell any Receivable or Contract, or interest
therein, without the prior written consent of the Collateral Agent, except as
permitted by Section 3.5. Each Assignor will duly fulfill all obligations on
its part to be fulfilled under or in connection with the Receivables and
Contracts and will do nothing to impair the rights of the Collateral Agent in
the Receivables or Contracts.
3.5. COLLECTION. Each Assignor shall endeavor to cause to be
collected from the account debtor named in each of its Receivables or obligor
under any Contract, as and when due (including, without limitation, amounts,
services or products which are delinquent, such amounts, services or products to
be collected in accordance with generally accepted lawful collection procedures)
any and all amounts, services or products owing under or on account of such
Receivable or Contract, and apply forthwith upon receipt thereof all such
amounts, services or products as are so collected to the outstanding balance of
such Receivable or under such Contract, except that, prior to the occurrence of
an Event of Default, any Assignor may allow in the ordinary course of business
as adjustments to amounts, services or products owing under its Receivables and
Contracts (i) an extension or renewal of the time or times of payment or
exchange, or settlement for less than the total unpaid balance, which such
Assignor finds appropriate in accordance with reasonable business judgment and
(ii) a refund or credit due as a result of returned or damaged merchandise or
improperly performed services. The costs and expenses (including, without
limitation, attorneys' fees) of collection, whether incurred by an Assignor or
the Collateral Agent, shall be borne by the relevant Assignor.
3.6. INSTRUMENTS. If any Assignor owns or acquires any Instrument
constituting Collateral, such Assignor will within 10 days notify the Collateral
Agent thereof, and upon request by the Collateral Agent will promptly deliver
such Instrument to the Collateral Agent appropriately endorsed to the order of
the Collateral Agent as further security hereunder.
3.7. FURTHER ACTIONS. Each Assignor will, at its own expense, make,
execute, endorse, acknowledge, file and/or deliver to the Collateral Agent from
time to time such
EXHIBIT H
PAGE 8
vouchers, invoices, schedules, confirmatory assignments, conveyances,
financing statements, transfer endorsements, powers of attorney,
certificates, reports and other assurances or instruments and take such
further steps relating to its Receivables, Contracts, Instruments and other
property or rights covered by the security interest hereby granted, as the
Collateral Agent may require.
ARTICLE IV
SPECIAL PROVISIONS CONCERNING TRADEMARKS
4.1. ADDITIONAL REPRESENTATIONS AND WARRANTIES. Each Assignor
represents and warrants that it is the true, lawful, sole and exclusive owner of
the Marks listed in Annex D hereto and that said listed Marks constitute all the
Marks that such Assignor presently owns or uses in connection with its business
and include all the United States federal registrations or applications
registered in the United States Patent and Trademark Office. Each Assignor
represents and warrants that it owns all Marks that it uses. Each Assignor
further warrants that it has no knowledge as of the date hereof, of any third
party claim that any aspect of such Assignor's present or contemplated business
operations infringes or will infringe any rights in any trademark, service ▇▇▇▇
or trade name. Each Assignor represents and warrants that it is the beneficial
and record owner of all trademark registrations and applications listed in Annex
D hereto and that said registrations are valid, subsisting and have not been
cancelled and that such Assignor is not aware of any third-party claim that any
of said registrations is invalid or unenforceable, or that there is any reason
that any of said applications will not pass to registration. Each Assignor
represents and warrants that upon the recordation of an Assignment of Security
Interest in United States Trademarks and Patents in the form of Annex G hereto
in the United States Patent and Trademark Office, together with filings on Form
UCC-1 pursuant to this Agreement, all filings, registrations and recordings
necessary or appropriate to perfect the security interest granted to the
Collateral Agent in the United States Marks covered by this Agreement under
federal law will have been accomplished. Each Assignor agrees to execute such
an Assignment of Security Interest in United States Trademark and Patents
covering all right, title and interest in each United States ▇▇▇▇, and the
associated goodwill, of such Assignor, and to record the same. Each Assignor
hereby grants to the Collateral Agent an absolute power of attorney to sign,
upon the occurrence and during the continuance of an Event of Default, any
document which may be required by the U.S. Patent and Trademark Office or
secretary of state or equivalent governmental agency of any State of the United
States or any foreign jurisdiction in order to effect an absolute assignment of
all right, title and interest in each ▇▇▇▇, and record the same.
4.2. LICENSES AND ASSIGNMENTS. Each Assignor hereby agrees not to
divest itself of any right under any ▇▇▇▇ which, in the good faith judgment of
management, is useful or valuable to its business, absent prior written approval
of the Collateral Agent, except as otherwise permitted by this Agreement or the
Credit Agreement.
4.3. INFRINGEMENTS. Each Assignor agrees, promptly upon learning
thereof, to notify the Collateral Agent in writing of the name and address of,
and to furnish such pertinent information that may be available with respect to,
(i) any party who such Assignor believes is
EXHIBIT H
PAGE 9
infringing or diluting or otherwise violating in any respect any of such
Assignor's rights in and to any ▇▇▇▇, or (ii) with respect to any party
claiming that such Assignor's use of any ▇▇▇▇ violates in any material
respect any property right of that party. Each Assignor further agrees,
unless otherwise agreed by the Collateral Agent, diligently to prosecute any
Person infringing any ▇▇▇▇.
4.4. PRESERVATION OF MARKS. Each Assignor agrees to use all its
Marks which, in the good faith judgment of management, is useful or valuable to
its business, in interstate or foreign commerce, as the case may be, during the
time in which this Agreement is in effect, sufficiently to preserve such Marks
as valid and subsisting trademarks or service marks under the laws of the United
States or the relevant foreign jurisdiction.
4.5. MAINTENANCE OF REGISTRATION. Each Assignor shall, at its own
expense, diligently process all documents required by the Trademark Act of 1946,
as amended, 15 U.S.C. Sections 1051 ET SEQ. to maintain trademark
registrations, including but not limited to affidavits of continued use and
applications for renewals of registration in the United States Patent and
Trademark Office for all of its registered Marks pursuant to 15 U.S.C. Sections
1058, 1059 and 1065 and any foreign equivalent thereof, and shall pay all fees
and disbursements in connection therewith and shall not abandon any such filing
of affidavit of use or any such application of renewal prior to the exhaustion
of all administrative and judicial remedies without prior written consent of the
Collateral Agent. Each Assignor agrees to notify the Collateral Agent at least
two (2) months prior to the dates on which the affidavits of use or the
applications for renewal registration are due with respect to any registered
▇▇▇▇ that the affidavits of use or the renewal is being processed.
4.6. FUTURE REGISTERED MARKS. If any registration for any ▇▇▇▇
issues hereafter to any Assignor as a result of any application now or hereafter
pending before the United States Patent and Trademark Office, within 30 days of
receipt of such certificate, such Assignor shall deliver to the Collateral Agent
a copy of such certificate, and an assignment for security in such ▇▇▇▇, to the
Collateral Agent and at the expense of such Assignor, confirming the assignment
for security in such ▇▇▇▇ to the Collateral Agent hereunder, the form of such
security to be substantially the same as the form hereof or in such other form
as may be satisfactory to the Collateral Agent.
4.7. REMEDIES. If an Event of Default shall occur and be continuing,
the Collateral Agent may, by written notice to the relevant Assignor, take any
or all of the following actions: (i) declare the entire right, title and
interest of such Assignor in and to each of the Marks, together with all
trademark rights and rights of protection to the same and the goodwill of such
Assignor's business symbolized by said Marks and the right to recover for post
infringements thereof, vested in the Collateral Agent for the benefit of the
Secured Creditors, in which event such rights, title and interest shall
immediately vest, in the Collateral Agent for the benefit of the Secured
Creditors, and the Collateral Agent shall be entitled to exercise the power of
attorney referred to in Section 4.1 hereof to execute, cause to be acknowledged
and notarized and to record said absolute assignment with the applicable agency;
(ii) take and use or sell the Marks and the goodwill of such Assignor's business
symbolized by the Marks and the right to carry on the business and use the
assets of such Assignor in connection with which the Marks have been used; and
(iii) direct such Assignor to refrain, in which event such Assignor shall
refrain, from using the
EXHIBIT H
PAGE 10
Marks in any manner whatsoever, directly or indirectly, and, if requested by
the Collateral Agent, change such Assignor's corporate name to eliminate
therefrom any use of any ▇▇▇▇ and execute such other and further documents
that the Collateral Agent may request to further confirm this and to transfer
ownership of the Marks and registrations and any pending trademark
applications therefor in the United States Patent and Trademark Office or any
equivalent government agency or office in any foreign jurisdiction to the
Collateral Agent.
ARTICLE V
SPECIAL PROVISIONS CONCERNING
PATENTS, COPYRIGHTS AND TRADE SECRETS
5.1. ADDITIONAL REPRESENTATIONS AND WARRANTIES. Each Assignor
represents and warrants that it is the true and lawful exclusive owner of all
rights in (i) all trade secrets and proprietary information necessary to operate
the business of such Assignor (the "Trade Secret Rights"), (ii) the Patents
listed in Annex E hereto and (iii) the Copyrights listed in Annex F hereto, that
said Patents constitute all the patents and applications for patents that such
Assignor now owns and that are necessary in the conduct of the business of such
Assignor and that said Copyrights constitute all registrations of copyrights and
applications for copyright registrations that the Assignor now owns and that are
necessary in the conduct of the business of such Assignor. Each Assignor
further represents and warrants that it has the exclusive right to use and
practice under all Patents and Copyrights that it owns, uses or practices under
and has the exclusive right to exclude others from using or practicing under any
Patents its owns, uses or practices under. Each Assignor further warrants that,
as of the date hereof, it has no knowledge of any third party claim that any
aspect of such Assignor's present or contemplated business operations infringes
or will infringe any rights in any patent or copyright or such Assignor has
misappropriated any trade secret or proprietary information. Each Assignor
represents and warrants that upon the recordation of an Assignment of Security
Interest in United States Trademarks and Patents in the form of Annex G hereto
in the United States Patent and Trademark Office and the recordation of an
Assignment of Security Interest in United States Copyrights in the form of Annex
H hereto in the United States Copyright Office, together with filings on
Form UCC-1 pursuant to this Agreement, all filings, registrations and recordings
necessary or appropriate to perfect the security interest granted to the
Collateral Agent in the United States Patents and United States Copyrights
covered by this Agreement under federal law will have been accomplished. Each
Assignor agrees to execute such an Assignment of Security Interest in United
States Trademarks and Patents covering all right, title and interest in each
United States Patent of such Assignor and to record the same, and to execute
such an Assignment of Security Interest in United States Copyrights covering all
right, title and interest in each United States Copyright of such Assignor and
to record the same. Each Assignor hereby grants to the Collateral Agent an
absolute power of attorney to sign, upon the occurrence and during the
continuance of any Event of Default, any document which may be required by the
U.S. Patent and Trademark Office or equivalent governmental agency in any
foreign jurisdiction or the U.S. Copyright Office or equivalent governmental
agency in any foreign jurisdiction in order to effect an absolute assignment of
all right, title and interest in each Patent and Copyright, and to record the
same.
EXHIBIT H
PAGE 11
5.2. LICENSES AND ASSIGNMENTS. Each Assignor hereby agrees not to
divest itself of any right under any Patent or Copyright which, in the good
faith judgment of management, is useful or valuable to its business absent prior
written approval of the Collateral Agent, except as otherwise permitted by this
Agreement or the Credit Agreement.
5.3. INFRINGEMENTS. Each Assignor agrees, promptly upon learning
thereof, to furnish the Collateral Agent in writing with all pertinent
information available to such Assignor with respect to infringement,
contributing infringement or active inducement to infringe in any Patent or
Copyright or to any claim that the practice of any Patent or the use of any
Copyright violates any property right of a third party, or with respect to any
misappropriation of any Trade Secret Right or any claim that practice of any
Trade Secret Right violates any property right of a third party. Each Assignor
further agrees, absent direction of the Collateral Agent to the contrary,
diligently to prosecute any Person infringing any Patent or Copyright or any
Person misappropriating any Trade Secret Right.
5.4. MAINTENANCE OF PATENTS AND COPYRIGHTS. At its own expense, each
Assignor shall make timely payment of all post-issuance fees required pursuant
to 35 U.S.C. Section 41 and any foreign equivalent thereof to maintain in force
rights under each Patent, and to apply as permitted pursuant to applicable law
for any renewal of each Copyright absent prior written consent of the Collateral
Agent.
5.5. PROSECUTION OF PATENT OR COPYRIGHT APPLICATION. At its own
expense, each Assignor shall diligently prosecute all applications for Patents
listed in Annex E hereto and for Copyrights listed in Annex F hereto and shall
not abandon any such application prior to exhaustion of all administrative and
judicial remedies, absent written consent of the Collateral Agent.
5.6. OTHER PATENTS AND COPYRIGHTS. Within 30 days of the acquisition
or issuance of a Patent or of a Copyright registration, or of filing of an
application for a Patent or Copyright registration, the relevant Assignor shall
deliver to the Collateral Agent a copy of said Copyright registration or Patent
or certificate or registration of, or application therefor, as the case may be,
with an assignment for security as to such Patent or Copyright, as the case may
be, to the Collateral Agent and at the expense of such Assignor, confirming the
assignment for security, the form of such assignment for security to be
substantially the same as the form hereof or in such other form as may be
satisfactory to the Collateral Agent.
5.7. REMEDIES. If an Event of Default shall occur and be continuing,
the Collateral Agent may by written notice to the relevant Assignor, take any or
all of the following actions: (i) declare the entire right, title, and interest
of such Assignor in each of the Patents and Copyrights vested in the Collateral
Agent for the benefit of the Secured Creditors, in which event such right,
title, and interest shall immediately vest in the Collateral Agent for the
benefit of the Secured Creditors, in which case the Collateral Agent shall be
entitled to exercise the power of attorney referred to in Section 5.1 hereof to
execute, cause to be acknowledged and notarized and to record said absolute
assignment with the applicable agency; (ii) take and practice or sell the
Patents, Copyrights and Trade Secret Rights; and (iii) direct such Assignor to
refrain, in which event such Assignor shall refrain, from practicing the Patents
and using the Copyrights and/or
EXHIBIT H
PAGE 12
Trade Secret Rights directly or indirectly, and such Assignor shall execute
such other and further documents as the Collateral Agent may request further
to confirm this and to transfer ownership of the Patents, Copyrights and
Trade Secret Rights to the Collateral Agent for the benefit of the Secured
Creditors.
ARTICLE VI
PROVISIONS CONCERNING ALL COLLATERAL
6.1. PROTECTION OF COLLATERAL AGENT'S SECURITY. Each Assignor will
do nothing to impair the rights of the Collateral Agent in the Collateral. Each
Assignor will at all times keep its Inventory and Equipment insured in favor of
the Collateral Agent, at such Assignor's own expense to the extent and in the
manner provided in the Credit Agreement; all policies or certificates with
respect to such insurance (and any other insurance maintained by such Assignor);
(i) shall be endorsed to the Collateral Agent's satisfaction for the benefit of
the Collateral Agent (including, without limitation, by naming the Collateral
Agent as loss payee and naming the Collateral Agent as an additional insured);
(ii) shall state that such insurance policies shall not be cancelled or
materially revised without 30 days' prior written notice thereof by the insurer
to the Collateral Agent; and (iii) certified copies of such policies or
certificates shall be deposited with the Collateral Agent. If any Assignor
shall fail to insure its Inventory and Equipment in accordance with the
preceding sentence, or if any Assignor shall fail to so endorse and deposit all
policies or certificates with respect thereto, the Collateral Agent shall have
the right (but shall be under no obligation) to procure such insurance and such
Assignor agrees to promptly reimburse the Collateral Agent for all costs and
expenses of procuring such insurance. The Collateral Agent shall, at the time
such proceeds of such insurance are distributed to the Secured Creditors, apply
such proceeds in accordance with Section 7.4 hereof. Each Assignor assumes all
liability and responsibility in connection with the Collateral acquired by it
and the liability of such Assignor to pay the Obligations shall in no way be
affected or diminished by reason of the fact that such Collateral may be lost,
destroyed, stolen, damaged or for any reason whatsoever unavailable to such
Assignor.
6.2. WAREHOUSE RECEIPTS NON-NEGOTIABLE. Each Assignor agrees that if
any warehouse receipt or receipt in the nature of a warehouse receipt is issued
with respect to any of its Inventory, such warehouse receipt or receipt in the
nature thereof shall not be "negotiable" (as such term is used in Section 7-104
of the Uniform Commercial Code as in effect in any relevant jurisdiction or
under other relevant law).
6.3. FURTHER ACTIONS. Each Assignor will, at its own expense, make,
execute, endorse, acknowledge, file and/or deliver to the Collateral Agent from
time to time such lists, descriptions and designations of its Collateral,
warehouse receipts, receipts in the nature of warehouse receipts, bills of
lading, documents of title, vouchers, invoices, schedules, confirmatory
assignments, conveyances, financing statements, transfer endorsements, powers of
attorney, certificates, reports and other assurances or instruments and take
such further steps relating to the Collateral and other property or rights
covered by the security interest hereby granted, which the Collateral Agent
deems reasonably appropriate or advisable to perfect, preserve or protect its
EXHIBIT H
PAGE 13
security interest in the Collateral, including, without limitation, any
Collateral which previously constituted Excluded Collateral.
6.4. FINANCING STATEMENTS. Each Assignor agrees to execute and
deliver to the Collateral Agent such financing statements, in form acceptable to
the Collateral Agent, as the Collateral Agent may from time to time request or
as are necessary or desirable in the opinion of the Collateral Agent to
establish and maintain a valid, enforceable, first priority perfected security
interest in the Collateral as provided herein and the other rights and security
contemplated hereby all in accordance with the Uniform Commercial Code as
enacted in any and all relevant jurisdictions or any other relevant law. Each
Assignor will pay any applicable filing fees, recordation taxes and related
expenses relating to its Collateral. Each Assignor hereby authorizes the
Collateral Agent to file any such financing statements without the signature of
such Assignor where permitted by law.
ARTICLE VII
REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT
7.1. REMEDIES; OBTAINING THE COLLATERAL UPON DEFAULT. Each Assignor
agrees that, if any Event of Default shall have occurred and be continuing, then
and in every such case, the Collateral Agent, in addition to any rights now or
hereafter existing under applicable law, shall have all rights as a secured
creditor under the Uniform Commercial Code in all relevant jurisdictions and may
also:
(i) personally, or by agents or attorneys, immediately take
possession of the Collateral or any part thereof, from such Assignor or any
other Person who then has possession of any part thereof with or without
notice or process of law, and for that purpose may enter upon such
Assignor's premises where any of the Collateral is located and remove the
same and use in connection with such removal any and all services,
supplies, aids and other facilities of such Assignor;
(ii) instruct the obligor or obligors on any agreement, instrument
or other obligation (including, without limitation, the Receivables and the
Contracts) constituting the Collateral to make any payment required by the
terms of such agreement, instrument or other obligation directly to the
Collateral Agent;
(iii) withdraw all monies, securities and instruments in the Cash
Collateral Account for application to the Obligations in accordance with
Section 7.4 hereof;
(iv) sell, assign or otherwise liquidate any or all of the
Collateral or any part thereof in accordance with Section 7.2 hereof, or
direct the relevant Assignor to sell, assign or otherwise liquidate any or
all of the Collateral or any part thereof, and, in each case, take
possession of the proceeds of any such sale or liquidation;
(v) take possession of the Collateral or any part thereof, by
directing the relevant Assignor in writing to deliver the same to the
Collateral Agent at any place or
EXHIBIT H
PAGE 14
places designated by the Collateral Agent, in which event such Assignor
shall at its own expense:
(x) forthwith cause the same to be moved to the place or
places so designated by the Collateral Agent and there delivered to
the Collateral Agent;
(y) store and keep any Collateral so delivered to the
Collateral Agent at such place or places pending further action by the
Collateral Agent as provided in Section 7.2 hereof; and
(z) while the Collateral shall be so stored and kept, provide
such guards and maintenance services as shall be necessary to protect
the same and to preserve and maintain them in good condition; and
(vi) license or sublicense, whether on an exclusive or nonexclusive
basis, any Marks, Patents or Copyrights included in the Collateral for such
term and on such conditions and in such manner as the Collateral Agent
shall in its sole judgment determine;
it being understood that each Assignor's obligation so to deliver the Collateral
is of the essence of this Agreement and that, accordingly, upon application to a
court of equity having jurisdiction, the Collateral Agent shall be entitled to a
decree requiring specific performance by such Assignor of said obligation.
7.2. REMEDIES; DISPOSITION OF THE COLLATERAL. Any Collateral
repossessed by the Collateral Agent under or pursuant to Section 7.1 hereof and
any other Collateral whether or not so repossessed by the Collateral Agent, may
be sold, assigned, leased or otherwise disposed of under one or more contracts
or as an entirety, and without the necessity of gathering at the place of sale
the property to be sold, and in general in such manner, at such time or times,
at such place or places and on such terms as the Collateral Agent may, in
compliance with any mandatory requirements of applicable law, determine to be
commercially reasonable. Any of the Collateral may be sold, leased or otherwise
disposed of, in the condition in which the same existed when taken by the
Collateral Agent or after any overhaul or repair at the expense of the relevant
Assignor which the Collateral Agent shall determine to be commercially
reasonable. Any such disposition which shall be a private sale or other private
proceedings permitted by such requirements shall be made upon not less than 10
days' written notice to the relevant Assignor specifying the time at which such
disposition is to be made and the intended sale price or other consideration
therefor, and shall be subject, for the 10 days after the giving of such notice,
to the right of the relevant Assignor or any nominee of such Assignor to acquire
the Collateral involved at a price or for such other consideration at least
equal to the intended sale price or other consideration so specified. Any such
disposition which shall be a public sale permitted by such requirements shall be
made upon not less than 10 days' written notice to the relevant Assignor
specifying the time and place of such sale and, in the absence of applicable
requirements of law, shall be by public auction (which may, at the Collateral
Agent's option, be subject to reserve), after publication of notice of such
auction not less than 10 days prior thereto in two newspapers in general
circulation to be selected by the Collateral Agent. To the extent permitted by
any such requirement of law, the Collateral Agent may bid for and become the
purchaser of the Collateral
EXHIBIT H
PAGE 15
or any item thereof, offered for sale in accordance with this Section without
accountability to the relevant Assignor. If, under mandatory requirements of
applicable law, the Collateral Agent shall be required to make disposition of
the Collateral within a period of time which does not permit the giving of
notice to the relevant Assignor as hereinabove specified, the Collateral
Agent need give such Assignor only such notice of disposition as shall be
reasonably practicable in view of such mandatory requirements of applicable
law. Each Assignor agrees to do or cause to be done all such other acts and
things as may be reasonably necessary to make such sale or sales of all or
any portion of the Collateral of such Assignor valid and binding and in
compliance with any and all applicable laws, regulations, orders, writs,
injunctions, decrees or awards of any and all courts, arbitrations or
governmental instrumentalities, domestic or foreign, having jurisdiction over
any such sale or sales, all at such Assignor's expense.
7.3. WAIVER OF CLAIMS. Except as otherwise provided in this
Agreement, EACH ASSIGNOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE COLLATERAL AGENT'S
TAKING POSSESSION OR THE COLLATERAL AGENT'S DISPOSITION OF ANY OF THE
COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING
FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH SUCH ASSIGNOR
WOULD OTHERWISE HAVE UNDER THE CONSTITUTION OR ANY STATUTE OF THE UNITED STATES
OR OF ANY STATE, and such Assignor hereby further waives, to the extent
permitted by law:
(i) all damages occasioned by such taking of possession except any
damages which are the direct result of the Collateral Agent's gross
negligence or willful misconduct;
(ii) all other requirements as to the time, place and terms of sale
or other requirements with respect to the enforcement of the Collateral
Agent's rights hereunder; and
(iii) all rights of redemption, appraisement, valuation, stay,
extension or moratorium now or hereafter in force under any applicable law
in order to prevent or delay the enforcement of this Agreement or the
absolute sale of the Collateral or any portion thereof, and each Assignor,
for itself and all who may claim under it, insofar as it or they now or
hereafter lawfully may, hereby waives the benefit of all such laws.
Any sale of, or the grant of options to purchase, or any other realization upon,
any Collateral shall operate to divest all right, title, interest, claim and
demand, either at law or in equity, of the relevant Assignor therein and
thereto, and shall be a perpetual bar both at law and in equity against such
Assignor and against any and all Persons claiming or attempting to claim the
Collateral so sold, optioned or realized upon, or any part thereof, from,
through and under such Assignor.
7.4. APPLICATION OF PROCEEDS. (a) All moneys collected by the
Collateral Agent upon any sale or other disposition of the Collateral (or, to
the extent the Pledge Agreement or Mortgages require proceeds of collateral
thereunder to be applied in accordance with the provisions of this Agreement,
the Pledgee or Mortgagee under such other Security Documents),
EXHIBIT H
PAGE 16
together with all other moneys received by the Collateral Agent hereunder,
shall be applied as follows:
(i) first, to the payment of all Obligations owing the Collateral
Agent of the type described in clauses (iii) and (iv) of the definition of
"Obligations";
(ii) second, to the extent proceeds remain after the application
pursuant to the preceding clause (i), an amount equal to the outstanding
Primary Obligations shall be paid to the Secured Creditors as provided in
Section 7.4(e) hereof, with each Secured Creditor receiving an amount equal
to its outstanding Primary Obligations or, if the proceeds are insufficient
to pay in full all such Primary Obligations, its Pro Rata Share of the
amount remaining to be distributed;
(iii) third, to the extent proceeds remain after the application
pursuant to the preceding clauses (i) and (ii), an amount equal to the
outstanding Secondary Obligations shall be paid to the Secured Creditors as
provided in Section 7.4(e) hereof, with each Secured Creditor receiving an
amount equal to its outstanding Secondary Obligations or, if the proceeds
are insufficient to pay in full all such Secondary Obligations, its Pro
Rata Share of the amount remaining to be distributed; and
(iv) fourth, to the extent proceeds remain after the application
pursuant to the preceding clauses (i) through (iii), inclusive, and
following the termination of this Agreement pursuant to Section 10.8(a)
hereof, to the relevant Assignor or to whomever may be lawfully entitled to
receive such surplus.
(b) For purposes of this Agreement (x) "Pro Rata Share" shall mean,
when calculating a Secured Creditor's portion of any distribution or amount,
that amount (expressed as a percentage) equal to a fraction the numerator of
which is the then unpaid amount of such Secured Creditor's Primary Obligations
or Secondary Obligations, as the case may be, and the denominator of which is
the then outstanding amount of all Primary Obligations or Secondary Obligations,
as the case may be, (y) "Primary Obligations" shall mean (i) in the case of the
Credit Document Obligations, all principal of, and interest on, all Loans under
the Credit Agreement, all Unpaid Drawings theretofore made (together with all
interest accrued thereon), the aggregate Stated Amounts of all Letters of Credit
issued (or deemed issued) under the Credit Agreement, and all Fees and (ii) in
the case of the Other Obligations, all amounts due under the Interest Rate
Protection Agreements or Other Hedging Agreements (other than indemnities, fees
(including, without limitation, attorneys' fees) and similar obligations and
liabilities) and (z) "Secondary Obligations" shall mean all Obligations other
than Primary Obligations.
(c) When payments to Secured Creditors are based upon their
respective Pro Rata Shares, the amounts received by such Secured Creditors
hereunder shall be applied (for purposes of making determinations under this
Section 7.4 only) (i) first, to their Primary Obligations and (ii) second, to
their Secondary Obligations. If any payment to any Secured Creditor of its Pro
Rata Share of any distribution would result in overpayment to such Secured
Creditor, such excess amount shall instead be distributed in respect of the
unpaid Primary Obligations or Secondary Obligations, as the case may be, of the
other Secured Creditors, with each Secured Creditor
EXHIBIT H
PAGE 17
whose Primary Obligations or Secondary Obligations, as the case may be, have
not been paid in full to receive an amount equal to such excess amount
multiplied by a fraction the numerator of which is the unpaid Primary
Obligations or Secondary Obligations, as the case may be, of such Secured
Creditor and the denominator of which is the unpaid Primary Obligations or
Secondary Obligations, as the case may be, of all Secured Creditors entitled
to such distribution.
(d) Each of the Secured Creditors agrees and acknowledges that if the
Bank Creditors are to receive a distribution on account of undrawn amounts with
respect to Letters of Credit issued (or deemed issued) under the Credit
Agreement (which shall only occur after all outstanding Loans and Unpaid
Drawings with respect to such Letters of Credit have been paid in full), such
amounts shall be paid to the Agent under the Credit Agreement and held by it,
for the equal and ratable benefit of the Bank Creditors, as cash security for
the repayment of Obligations owing to the Bank Creditors as such. If any
amounts are held as cash security pursuant to the immediately preceding
sentence, then upon the termination of all outstanding Letters of Credit, and
after the application of all such cash security to the repayment of all
Obligations owing to the Bank Creditors after giving effect to the termination
of all such Letters of Credit, if there remains any excess cash, such excess
cash shall be returned by the Agent to the Collateral Agent for distribution in
accordance with Section 7.4(a) hereof.
(e) Except as set forth in Section 7.4(d) hereof, all payments
required to be made hereunder shall be made (x) if to the Bank Creditors, to the
Agent under the Credit Agreement for the account of the Bank Creditors, and (y)
if to the Other Creditors, to the trustee, paying agent or other similar
representative (each, a "Representative") for the Other Creditors or, in the
absence of such a Representative, directly to the Other Creditors.
(f) For purposes of applying payments received in accordance with
this Section 7.4, the Collateral Agent shall be entitled to rely upon (i) the
Agent under the Credit Agreement and (ii) the Representative for the Other
Creditors or, in the absence of such a Representative, upon the Other Creditors
for a determination (which the Agent, each Representative for any Other
Creditors and the Secured Creditors agree (or shall agree) to provide upon
request of the Collateral Agent) of the outstanding Primary Obligations and
Secondary Obligations owed to the Bank Creditors or the Other Creditors, as the
case may be. Unless it has actual knowledge (including by way of written notice
from a Bank Creditor or an Other Creditor) to the contrary, the Agent and each
Representative, in furnishing information pursuant to the preceding sentence,
and the Collateral Agent, in acting hereunder, shall be entitled to assume that
no Secondary Obligations are outstanding. Unless it has actual knowledge
(including by way of written notice from an Other Creditor) to the contrary, the
Collateral Agent, in acting hereunder, shall be entitled to assume that no
Interest Rate Protection Agreements or Other Hedging Agreements are in
existence.
(g) It is understood and agreed that each of the Assignors shall
remain jointly and severally liable to the extent of any deficiency between the
amount of the proceeds of the Collateral hereunder and the aggregate amount of
the sums referred to in clause (a) of this Section with respect to the relevant
Assignor.
EXHIBIT H
PAGE 18
7.5. REMEDIES CUMULATIVE. Each and every right, power and remedy
hereby specifically given to the Collateral Agent shall be in addition to every
other right, power and remedy specifically given under this Agreement, the
Interest Rate Protection Agreements or Other Hedging Agreements or the other
Credit Documents now or hereafter existing at law, in equity or by statute and
each and every right, power and remedy whether specifically herein given or
otherwise existing may be exercised from time to time or simultaneously and as
often and in such order as may be deemed expedient by the Collateral Agent. All
such rights, powers and remedies shall be cumulative and the exercise or the
beginning of the exercise of one shall not be deemed a waiver of the right to
exercise any other or others. No delay or omission of the Collateral Agent in
the exercise of any such right, power or remedy and no renewal or extension of
any of the Obligations shall impair any such right, power or remedy or shall be
construed to be a waiver of any Default or Event of Default or an acquiescence
therein. No notice to or demand on any Assignor in any case shall entitle it to
any other or further notice or demand in similar or other circumstances or
constitute a waiver of any of the rights of the Collateral Agent to any other or
further action in any circumstances without notice or demand. In the event that
the Collateral Agent shall bring any suit to enforce any of its rights hereunder
and shall be entitled to judgment, then in such suit the Collateral Agent may
recover expenses, including attorneys' fees, and the amounts thereof shall be
included in such judgment.
7.6. DISCONTINUANCE OF PROCEEDINGS. In case the Collateral Agent
shall have instituted any proceeding to enforce any right, power or remedy under
this Agreement by foreclosure, sale, entry or otherwise, and such proceeding
shall have been discontinued or abandoned for any reason or shall have been
determined adversely to the Collateral Agent, then and in every such case the
relevant Assignor, the Collateral Agent and each holder of any of the
Obligations shall be restored to their former positions and rights hereunder
with respect to the Collateral subject to the security interest created under
this Agreement, and all rights, remedies and powers of the Collateral Agent
shall continue as if no such proceeding had been instituted.
ARTICLE VIII
INDEMNITY
8.1. INDEMNITY. (a) Each Assignor jointly and severally agrees to
indemnify, reimburse and hold the Collateral Agent, each other Secured Creditor
and their respective successors, permitted assigns, employees, agents and
servants (hereinafter in this Section 8.1 referred to individually as an
"Indemnitee," and, collectively, as "Indemnities") harmless from any and all
liabilities, obligations, damages, injuries, penalties, claims, demands,
actions, suits, judgments and any and all costs, expenses or disbursements
(including attorneys' fees and expenses) (for the purposes of this Section 8.1
the foregoing are collectively called "expenses") of whatsoever kind and nature
imposed on, asserted against or incurred by any of the Indemnities in any way
relating to or arising out of this Agreement, any Interest Rate Protection
Agreement or Other Hedging Agreement, any other Credit Document or any other
document executed in connection herewith or therewith or in any other way
connected with the administration of the transactions contemplated hereby or
thereby or the enforcement of any of the terms of, or the preservation of any
rights under any thereof, or in any way relating to or arising out of the
EXHIBIT H
PAGE 19
manufacture, ownership, ordering, purchase, delivery, control, acceptance,
lease, financing, possession, operation, condition, sale, return or other
disposition, or use of the Collateral (including, without limitation, latent or
other defects, whether or not discoverable), the violation of the laws of any
country, state or other governmental body or unit, any tort (including, without
limitation, claims arising or imposed under the doctrine of strict liability, or
for or on account of injury to or the death of any Person (including any
Indemnitee), or property damage), or contract claim; provided that no Indemnitee
shall be indemnified pursuant to this Section 8.1(a) for losses, damages or
liabilities to the extent caused by the gross negligence or willful misconduct
of such Indemnitee. Each Assignor agrees that upon written notice by any
Indemnitee of the assertion of such a liability, obligation, damage, injury,
penalty, claim, demand, action, suit or judgment, the relevant Assignor shall
assume full responsibility for the defense thereof. Each Indemnitee agrees to
use its best efforts to promptly notify the relevant Assignor of any such
assertion of which such Indemnitee has knowledge.
(b) Without limiting the application of Section 8.1(a) hereof, each
Assignor agrees, jointly and severally, to pay, or reimburse the Collateral
Agent for any and all fees, costs and expenses of whatever kind or nature
incurred in connection with the creation, preservation or protection of the
Collateral Agent's Liens on, and security interest in, the Collateral,
including, without limitation, all fees and taxes in connection with the
recording or filing of instruments and documents in public offices, payment or
discharge of any taxes or Liens upon or in respect of the Collateral, premiums
for insurance with respect to the Collateral and all other fees, costs and
expenses in connection with protecting, maintaining or preserving the Collateral
and the Collateral Agent's interest therein, whether through judicial
proceedings or otherwise, or in defending or prosecuting any actions, suits or
proceedings arising out of or relating to the Collateral.
(c) Without limiting the application of Section 8.1(a) or (b) hereof,
each Assignor agrees, jointly and severally, to pay, indemnify and hold each
Indemnitee harmless from and against any loss, costs, damages and expenses which
such Indemnitee may suffer, expend or incur in consequence of or growing out of
any misrepresentation by any Assignor in this Agreement, any Interest Rate
Protection Agreement or Other Hedging Agreement, any other Credit Document or in
any writing contemplated by or made or delivered pursuant to or in connection
with this Agreement, any Interest Rate Protection Agreement or Other Hedging
Agreement or any other Credit Document.
(d) If and to the extent that the obligations of any Assignor under
this Section 8.1 are unenforceable for any reason, such Assignor hereby agrees
to make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law.
8.2. INDEMNITY OBLIGATIONS SECURED BY COLLATERAL; SURVIVAL. Any
amounts paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral. The
indemnity obligations of each Assignor contained in this Article VIII shall
continue in full force and effect notwithstanding the full payment of all the
Notes issued under the Credit Agreement, the termination of all Interest Rate
Protection Agreements or Other Hedging Agreements and Letters of Credit, and the
payment of all other Obligations and notwithstanding the discharge thereof.
EXHIBIT H
PAGE 20
ARTICLE IX
DEFINITIONS
The following terms shall have the meanings herein specified. Such
definitions shall be equally applicable to the singular and plural forms of the
terms defined.
"Agent" shall have the meaning provided in the recitals to this
Agreement.
"Agreement" shall have the meaning provided in the preamble to this
Agreement.
"Assignor" shall have the meaning provided in the preamble to this
Agreement.
"Bank Creditors" shall have the meaning provided in the recitals to
this Agreement.
"Banks" shall have the meaning provided in the recitals to this
Agreement.
"Borrowers" shall have the meaning provided in the recitals of this
Agreement.
"Cash Collateral Account" shall mean a non-interest bearing cash
collateral account maintained with, and in the sole dominion and control of, the
Collateral Agent for the benefit of the Secured Creditors.
"Chattel Paper" shall have the meaning provided in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.
"Class" shall have the meaning provided in Section 10.2 of this
Agreement.
"Collateral" shall have the meaning provided in Section 1.1(a) of this
Agreement.
"Collateral Agent" shall have the meaning provided in the preamble to
this Agreement.
"Contract Rights" shall mean all rights of any Assignor (including
without limitation all rights to payment) under each Contract.
"Contracts" shall mean all contracts between any Assignor and one or
more additional parties (including, without limitation, any Interest Rate
Protection Agreements or Other Hedging Agreements), but excluding those
Contracts to the extent that the terms thereof expressly prohibit the assignment
of, or granting of a security interest in, such Assignor's rights and
obligations thereunder (it being understood and agreed, however, that
notwithstanding the foregoing, all rights to payment for money due or to become
due pursuant to any excluded contract shall be subject to the security interests
created pursuant to this Agreement).
"Copyrights" shall mean any U.S. or foreign copyright owned by any
Assignor, including any registrations of any Copyrights, in the U.S. Copyright
Office or the equivalent thereof in any foreign country, as well as any
application for a U.S. or foreign copyright
EXHIBIT H
PAGE 21
registration now or hereafter made with the U.S. Copyright Office or the
equivalent thereof in any foreign jurisdiction by any Assignor.
"Credit Agreement" shall have the meaning provided in the recitals to
this Agreement.
"Credit Document Obligations" shall have the meaning provided in the
definition of "Obligations" in this Article IX.
"Default" shall mean any event which, with notice or lapse of time, or
both, would constitute an Event of Default.
"Documents" shall have the meaning provided in the Uniform Commercial
Code as in effect on the date hereof in the State of New York.
"Equipment" shall mean any "equipment," as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York, now or hereafter owned by any Assignor and, in any event, shall include,
but shall not be limited to, all machinery, equipment, furnishings, movable
trade fixtures and vehicles now or hereafter owned by any Assignor and any and
all additions, substitutions and replacements of any of the foregoing, wherever
located, together with all attachments, components, parts, equipment and
accessories installed thereon or affixed thereto.
"Event of Default" shall mean any Event of Default under, and as
defined in, the Credit Agreement or any payment default under any Interest Rate
Protection Agreement or Other Hedging Agreement and shall in any event, without
limitation, include any payment default on any of the Obligations after the
expiration of any applicable grace period.
"French Borrower" shall have the meaning provided in the recitals of
this Agreement.
"General Intangibles" shall have the meaning provided in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.
"Goods" shall have the meaning provided in the Uniform Commercial Code
as in effect on the date hereof in the State of New York.
"Holdings" shall have the meaning provided in the recitals to this
Agreement.
"Indemnitee" shall have the meaning provided in Section 8.1 of this
Agreement.
"Instrument" shall have the meaning provided in the Uniform Commercial
Code as in effect on the date hereof in the State of New York.
"Interest Rate Protection Agreement or Other Hedging Agreement" shall
have the meaning provided in the recitals to this Agreement.
"Inventory" shall mean merchandise, inventory and goods, and all
additions, substitutions and replacements thereof, wherever located, together
with all goods, supplies,
EXHIBIT H
PAGE 22
incidentals, packaging materials, labels, materials and any other items used
or usable in manufacturing, processing, packaging or shipping same; in all
stages of production -- from raw materials through work-in-process to
finished goods -- and all products and proceeds of whatever sort and wherever
located and any portion thereof which may be returned, rejected, reclaimed or
repossessed by the Collateral Agent from any Assignor's customers, and shall
specifically include all "inventory" as such term is defined in the Uniform
Commercial Code as in effect on the date hereof in the State of New York, now
or hereafter owned by any Assignor.
"Liens" shall mean any security interest, mortgage, pledge, lien,
claim, charge, encumbrance, title retention agreement, lessor's interest in a
financing lease or analogous instrument, in, of, or on any Assignor's property.
"Marks" shall mean all right, title and interest in and to any U.S. or
foreign trademarks, service marks and trade names now held or hereafter acquired
by any Assignor, including any registration or application for registration of
any trademarks and service marks in the United States Patent and Trademark
Office, or the equivalent thereof in any State of the United States or in any
foreign country, and any trade dress including logos, designs, trade names,
company names, business names, fictitious business names and other business
identifiers in connection with which any of these registered or unregistered
marks are used.
"Obligations" shall mean (i) the full and prompt payment when due
(whether at the stated maturity, by acceleration or otherwise) of all
obligations and liabilities (including, without limitation, indemnities, fees
and interest thereon) of each Assignor owing to the Bank Creditors, now existing
or hereafter incurred under, arising out of or in connection with any Credit
Document to which such Assignor is a party (including all such obligations and
liability under any Guaranty to which such Assignor is a party) and the due
performance and compliance by each Assignor with the terms, conditions and
agreements of each such Credit Document (all such obligations and liabilities
under this clause (i), except to the extent consisting of obligations or
liabilities with respect to Interest Rate Protection Agreements or Other Hedging
Agreements, being herein collectively called the "Credit Document Obligations");
(ii) the full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of all obligations and liabilities (including,
without limitation, indemnities, fees and interest thereon) of each Assignor
owing to the Other Creditors, now existing or hereafter incurred under, arising
out of or in connection with any Interest Rate Protection Agreement or Other
Hedging Agreement, whether such Interest Rate Protection Agreement or Other
Hedging Agreement is now in existence or hereafter arising), including, all such
obligations under the Parent Guaranty and (y) each Subsidiary Guarantor, all
obligations and liabilities under any Guaranty to which such Assignor is a
party, in each case in respect of Interest Rate Protection Agreements or Other
Hedging Agreements), and the due performance and compliance by such Assignor
with all of the terms, conditions and agreements contained in any such Interest
Rate Protection Agreement or Other Hedging Agreement (all such obligations and
liabilities under this clause (ii) being herein collectively called the "Other
Obligations"); (iii) any and all sums advanced by the Collateral Agent in order
to preserve the Collateral or preserve its security interest in the Collateral;
(iv) in the event of any proceeding for the collection or enforcement of any
indebtedness, obligations, or liabilities of each Assignor referred to in
clauses (i), (ii) and (iii) after an Event of Default shall have occurred and be
continuing, the reasonable expenses of re-taking, holding, preparing for sale
EXHIBIT H
PAGE 23
or lease, selling or otherwise disposing of or realizing on the Collateral,
or of any exercise by the Collateral Agent of its rights hereunder, together
with reasonable attorneys' fees and court costs; and (v) all amounts paid by
any Indemnitee as to which such Indemnitee has the right to reimbursement
under Section 8.1 of this Agreement. It is acknowledged and agreed that the
"Obligations" shall include extensions of credit of the types described
above, whether outstanding on the date of this Agreement or extended from
time to time after the date of this Agreement.
"Other Creditors" shall have the meaning provided in the recitals to
this Agreement.
"Other Obligations" shall have the meaning provided in the definition
of "Obligations" in this Article IX.
"Parent" shall have the meaning provided in the recitals to this
Agreement.
"Patents" shall mean any U.S. or foreign patent to which any Assignor
now or hereafter has title and any divisions or continuations thereof, as well
as any application for a U.S. or foreign patent now or hereafter made by any
Assignor.
"Pledged Securities" shall have the meaning provided in the Pledge
Agreement.
"Primary Obligations" shall have the meaning provided in Section
7.4(b) of this Agreement.
"Proceeds" shall have the meaning provided in the Uniform Commercial
Code as in effect in the State of New York on the date hereof or under other
relevant law and, in any event, shall include, but not be limited to, (i) any
and all proceeds of any insurance, indemnity, warranty or guaranty payable to
the Collateral Agent or any Assignor from time to time with respect to any of
the Collateral, (ii) any and all payments (in any form whatsoever) made or due
and payable to any Assignor from time to time in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of all or any
part of the Collateral by any governmental authority (or any person acting under
color of governmental authority) and (iii) any and all other amounts from time
to time paid or payable under or in connection with any of the Collateral.
"Pro Rata Share" shall have the meaning provided in Section 7.4(b) of
this Agreement.
"Receivables" shall mean any "account" as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York, now or hereafter owned by any Assignor and, in any event, shall include,
but shall not be limited to, all of such Assignor's rights to payment for, or
exchange of, goods sold or leased or services performed or product exchanged by
such Assignor, whether now in existence or arising from time to time hereafter,
including, without limitation, rights evidenced by an account, note, contract,
barter arrangement, security agreement, chattel paper, or other evidence of
indebtedness or security, together with (a) all security pledged, assigned,
hypothecated or granted to or held by such Assignor to secure the foregoing, (b)
all of any Assignor's right, title and interest in and to any goods or services,
the sale or exchange of which gave rise thereto, (c) all guarantees,
EXHIBIT H
PAGE 24
endorsements and indemnifications on, or of, any of the foregoing, (d) all
powers of attorney for the execution of any evidence of indebtedness or security
or other writing in connection therewith, (e) all books, records, ledger cards,
and invoices relating thereto, (f) all evidences of the filing of financing
statements and other statements and the registration of other instruments in
connection therewith and amendments thereto, notices to other creditors or
secured parties, and certificates from filing or other registration officers,
(g) all credit information, reports and memoranda relating thereto and (h) all
other writings related in any way to the foregoing.
"Representative" shall have the meaning provided in Section 7.4(e) of
this Agreement.
"Requisite Creditors" shall have the meaning provided in Section 10.2
of this Agreement.
"Secondary Obligations" shall have the meaning provided in Section
7.4(b) of this Agreement.
"Secured Creditors" shall have the meaning provided in the recitals to
this Agreement.
"Termination Date" shall have the meaning provided in Section 10.8 of
this Agreement.
"Trade Secret Rights" shall have the meaning provided in Section 5.1
of this Agreement.
"US Borrower" shall have the meaning provided in the recitals to this
Agreement.
ARTICLE X
MISCELLANEOUS
10.1. NOTICES. Except as otherwise specified herein, all notices,
requests, demands or other communications to or upon the respective parties
hereto shall be deemed to have been duly given or made when delivered to the
party to which such notice, request, demand or other communication is required
or permitted to be given or made under this Agreement, addressed:
(a) if to any Assignor, at it address set forth opposite its
signature below;
(b) if to the Collateral Agent:
Bankers Trust Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
EXHIBIT H
PAGE 25
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
(c) if to any Bank Creditor (other than the Collateral Agent), at
such address as such Bank Creditor shall have specified in the Credit
Agreement; and
(d) if to any Other Creditor, at such address as such Other Creditor
shall have specified in writing to each Assignor and the Collateral Agent;
or at such other address as shall have been furnished in writing by any Person
described above to the party required to give notice hereunder.
10.2. WAIVER; AMENDMENT. None of the terms and conditions of this
Agreement may be changed, waived, modified or varied in any manner whatsoever
unless in writing duly signed by each Assignor directly and adversely affected
thereby and the Collateral Agent (with the consent of (x) the Required Banks (or
all the Banks if required by Section 13.12 of the Credit Agreement) at all times
prior to the time at which all Credit Document Obligations have been paid in
full and all Commitments under the Credit Agreement have been terminated or (y)
the holders of at least a majority of the outstanding Other Obligations at all
times after the time on which all Credit Document Obligations have been paid in
full and all Commitments under the Credit Agreement have been terminated;
PROVIDED, that any change, waiver, modification or variance affecting the rights
and benefits of a single Class of Secured Creditors (and not all Secured
Creditors in a like or similar manner) shall require the written consent of the
Requisite Creditors of such Class of Secured Creditors. For the purpose of this
Agreement the term "Class" shall mean each class of Secured Creditors, I.E.,
whether (x) the Bank Creditors as holders of the Credit Document Obligations or
(y) the Other Creditors as the holders of the Other Obligations. For the purpose
of this Agreement, the term "Requisite Creditors" of any Class shall mean each
of (x) with respect to the Credit Document Obligations, the Required Banks and
(y) with respect to the Other Obligations, the holders of at least a majority of
all obligations outstanding from time to time under the Interest Rate Protection
Agreements or Other Hedging Agreements.
10.3. OBLIGATIONS ABSOLUTE. The obligations of each Assignor
hereunder shall remain in full force and effect without regard to, and shall not
be impaired by, (a) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of such Assignor; (b) any
exercise or non-exercise, or any waiver of, any right, remedy, power or
privilege under or in respect of this Agreement, any other Credit Document or
any Interest Rate Protection Agreement or Other Hedging Agreement; or (c) any
renewal, extension, amendment or modification of or addition or supplement to or
deletion from any Credit Document or any Interest Rate Protection Agreement or
Other Hedging Agreement or any security for any of the Obligations; (d) any
waiver, consent, extension, indulgence or other action or inaction under or in
respect of any such agreement or instrument including, without limitation, this
Agreement; (e) any furnishing of any additional security to the Collateral
Agent or its assignee or any acceptance thereof or any release of any security
by the Collateral Agent or its assignee; or (f) any limitation on any party's
liability or obligations under any such instrument or agreement or any
invalidity or unenforceability, in whole or in part, of any such instrument or
agreement or any term thereof; whether or not any Assignor shall have notice or
knowledge of any of the foregoing. The rights
EXHIBIT H
PAGE 26
and remedies of the Collateral Agent herein provided are cumulative and not
exclusive of any rights or remedies which the Collateral Agent would
otherwise have.
10.4. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
each Assignor and its successors and assigns and shall inure to the benefit of
the Collateral Agent and its successors and assigns; PROVIDED, that no Assignor
may transfer or assign any or all of its rights or obligations hereunder without
the prior written consent of the Collateral Agent. All agreements, statements,
representations and warranties made by each Assignor herein or in any
certificate or other instrument delivered by such Assignor or on its behalf
under this Agreement shall be considered to have been relied upon by the Secured
Creditors and shall survive the execution and delivery of this Agreement, the
other Credit Documents and the Interest Rate Protection Agreements or Other
Hedging Agreements regardless of any investigation made by the Secured Creditors
or on their behalf.
10.5. HEADINGS DESCRIPTIVE. The headings of the several sections of
this Agreement are inserted for convenience only and shall not in any way affect
the meaning or construction of any provision of this Agreement.
10.6. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED
BY THE LAW OF THE STATE OF NEW YORK.
10.7. ASSIGNOR'S DUTIES. It is expressly agreed, anything herein
contained to the contrary notwithstanding, that each Assignor shall remain
liable to perform all of the obligations, if any, assumed by it with respect to
the Collateral and the Collateral Agent shall not have any obligations or
liabilities with respect to any Collateral by reason of or arising out of this
Agreement, nor shall the Collateral Agent be required or obligated in any manner
to perform or fulfill any of the obligations of each Assignor under or with
respect to any Collateral.
10.8. TERMINATION; RELEASE. (a) After the Termination Date this
Agreement shall terminate (provided that all indemnities set forth herein
including, without limitation, in Section 8.1 hereof shall survive such
termination) and the Collateral Agent, at the request and expense of the
respective Assignor, will promptly execute and deliver to such Assignor a proper
instrument or instruments (including Uniform Commercial Code termination
statements on form UCC-3) acknowledging the satisfaction and termination of this
Agreement, and will duly assign, transfer and deliver to such Assignor (without
recourse and without any representation or warranty) such of the Collateral as
may be in the possession of the Collateral Agent and as has not theretofore been
sold or otherwise applied or released pursuant to this Agreement. As used in
this Agreement, "Termination Date" shall mean the date upon which the Total
Commitment and all Interest Rate Protection Agreements or Other Hedging
Agreements have been terminated, no Note is outstanding (and all Loans have been
paid in full), all Letters of Credit have been terminated and all other
Obligations then owing have been paid in full.
(b) In the event that any part of the Collateral is sold (x) at any
time prior to the time at which all Credit Document Obligations have been paid
in full and all Commitments under
EXHIBIT H
PAGE 27
the Credit Agreement have been terminated, in connection with a sale
permitted by Section 9.02 of the Credit Agreement or is otherwise released at
the direction of the Required Banks (or all the Banks if required by Section
13.12 of the Amended and Restated Credit Agreement) or (y) at any time
thereafter, to the extent permitted by the Interest Rate Protection
Agreements or Other Hedging Agreements, and in the case of clause (x) and
(y), the proceeds of such sale or sales or from such release are applied in
accordance with the terms of the Credit Agreement or such Interest Rate
Protection Agreements or Other Hedging Agreements, as the case may be, to the
extent required to be so applied, the Collateral Agent, at the request and
expense of such Assignor, will duly assign, transfer and deliver to such
Assignor (without recourse and without any representation or warranty) such
of the Collateral as is then being (or has been) so sold or released and as
may be in the possession of the Collateral Agent and has not theretofore been
released pursuant to this Agreement.
(c) At any time that the respective Assignor desires that Collateral
be released as provided in the foregoing Section 10.8(a) or (b), it shall
deliver to the Collateral Agent a certificate signed by its chief financial
officer or another senior officer of such Assignor stating that the release of
the respective Collateral is permitted pursuant to such Section 10.8(a) or (b).
If requested by the Collateral Agent (although the Collateral Agent shall have
no obligation to make any such request), the relevant Assignor shall furnish
appropriate legal opinions (from counsel, which may be in-house counsel,
reasonably acceptable to the Collateral Agent) to the effect set forth in the
immediately preceding sentence. The Collateral Agent shall have no liability
whatsoever to any Secured Creditor as the result of any release of Collateral by
it as permitted by this Section 10.8.
10.9. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Collateral Agent.
10.10. THE COLLATERAL AGENT. The Collateral Agent will hold in
accordance with this Agreement all items of the Collateral at any time received
under this Agreement. It is expressly understood and agreed that the obligations
of the Collateral Agent as holder of the Collateral and interests therein and
with respect to the disposition thereof, and otherwise under this Agreement, are
only those expressly set forth in this Agreement. The Collateral Agent shall
act hereunder on the terms and conditions set forth in Section 12 of the Credit
Agreement.
10.11. 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.
10.12. LIMITED OBLIGATIONS. It is the desire and intent of each
Assignor and the other Secured Creditors that this Agreement shall be enforced
against each Assignor to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which enforcement is sought.
EXHIBIT H
PAGE 28
10.13. ADDITIONAL ASSIGNORS. It is understood and agreed that any
Subsidiary of Parent that is required to execute a counterpart of this Agreement
after the date hereof pursuant to the Credit Agreement shall automatically
become an Assignor hereunder by executing a counterpart hereof and delivering
the same to the Collateral Agent.
* * *
EXHIBIT H
PAGE 29
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed and delivered by their duly authorized officers as of the date first
above written.
Address:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ TRISTAR AEROSPACE, CO., as an
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Assignor
Attention: ▇▇▇▇▇▇▇ Childress
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇▇▇ Childress
-------------------------------
Title: Vice President and
Chief Financial Officer
with copies to:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ AEROSPACE ACQUISITION CORP.,
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ as an Assignor
Attention: ▇▇▇▇▇▇▇ Childress
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇▇▇ Childress
-------------------------------
Title: Vice President and
Chief Financial Officer
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ TRISTAR AEROSPACE, INC.,
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ as an Assignor
Attention: ▇▇▇▇▇▇▇ Childress
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇▇▇ Childress
-------------------------------
Title: Vice President and
Chief Financial Officer
with copies to:
STANDARD PARTS AND EQUIPMENT
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ as an Assignor
Attention: ▇▇▇▇▇▇▇ Childress
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇▇▇ Childress
-------------------------------
Title: Vice President and
Chief Financial Officer
EXHIBIT H
PAGE 30
BANKERS TRUST COMPANY,
as Collateral Agent
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Title: Principal