EXHIBIT 99.2
SECURITY AGREEMENT
among
SILGAN HOLDINGS INC.,
SILGAN CONTAINERS CORPORATION,
SILGAN PLASTICS CORPORATION,
CERTAIN OTHER SUBSIDIARIES OF SILGAN HOLDINGS INC.
and
BANKERS TRUST COMPANY,
as Collateral Agent
Dated as of July 29, 1997
TABLE OF CONTENTS
Page
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.............................................. 6
3.4. Modification of Terms; etc................................... 7
3.5. Collection................................................... 7
3.6. Instruments.................................................. 7
3.7. Assignors Remain Liable Under Receivables.................... 8
3.8. Assignors Remain Liable Under Contracts...................... 8
3.9. Further Actions.............................................. 8
ARTICLE IV SPECIAL PROVISIONS CONCERNING TRADEMARKS............ 9
4.1. Additional Representations and Warranties.................... 9
4.2. Licenses and Assignments..................................... 9
4.3. Infringements................................................ 9
4.4. Preservation of Marks........................................ 10
4.5. Maintenance of Registration.................................. 10
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Page
4.6. Future Registered Marks...................................... 13
4.7. Remedies..................................................... 13
ARTICLE V SPECIAL PROVISIONS CONCERNING
PATENTS, COPYRIGHTS AND TRADE SECRETS..................... 14
5.1. Additional Representations and Warranties.................... 14
5.2. Licenses and Assignments..................................... 15
5.3. Infringements................................................ 15
5.4. Maintenance of Patents and Copyrights........................ 15
5.5. Prosecution of Patent and Copyright
Applications.............................................. 16
5.6. Other Patents and Copyrights................................. 16
5.7. Remedies..................................................... 16
ARTICLE VI PROVISIONS CONCERNING ALL COLLATERAL................ 17
6.1. Protection of Collateral Agent's Security.................... 17
6.2. Warehouse Receipts Non-negotiable............................ 17
6.3. Further Actions.............................................. 17
6.4. Financing Statements......................................... 18
ARTICLE VII REMEDIES UPON OCCURRENCE OF EVENT OF
DEFAULT................................................. 18
7.1. Remedies; Obtaining the Collateral Upon De-
fault..................................................... 18
7.2. Remedies; Disposition of the Collateral...................... 20
7.3. Waiver of Claims............................................. 21
7.4. Application of Proceeds...................................... 22
7.5. Remedies Cumulative.......................................... 25
7.6. Discontinuance of Proceedings................................ 26
ARTICLE VIII INDEMNITY..................................................... 26
8.1. Indemnity.................................................... 26
8.2. Indemnity Obligations Secured by
Collateral; Survival...................................... 27
ARTICLE IX DEFINITIONS......................................... 28
ARTICLE X MISCELLANEOUS............................................. 34
10.1. Notices..................................................... 34
10.2. Waiver; Amendment........................................... 35
10.3. Obligations Absolute........................................ 35
10.4. Successors and Assigns...................................... 35
10.5. Headings Descriptive........................................ 36
10.6. Governing Law............................................... 36
10.7. Assignor's Duties........................................... 36
10.8. Termination; Release........................................ 36
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Page
10.9. Counterparts................................................ 37
10.10. The Collateral Agent....................................... 37
10.11. Severability............................................... 38
10.12. Additional Assignors....................................... 38
ANNEX A Schedule of Chief Executive Offices and other Record Locations
ANNEX B Schedule of Inventory and Equipment Locations
ANNEX C Trade and Fictitious Names
ANNEX D List of Marks
ANNEX E List of Patents and Applications
ANNEX F List of Copyright Registrations and Applications
ANNEX G Assignment of Security Interest in United States Trademarks and Patents
ANNEX H Assignment of Security Interest in United States Copyrights
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SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of July 29, 1997, among each of
the undersigned assignors (each, an "Assignor" and, together with any other
entity that becomes an assignor hereunder pursuant to Section 10.12 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, capitalized terms used herein and defined in the
Credit Agreement (as defined below) shall be used herein as therein defined.
W I T N E S S E T H :
WHEREAS, Silgan Holdings Inc. ("Silgan"), Silgan Containers
Corporation ("Containers"), Silgan Plastics Corporation ("Plastics"), each other
Revolving Borrower (together with Silgan, Containers and Plastics, the
"Borrowers," and each individually, a "Borrower"), the lenders from time to time
party thereto (each a "Bank" and, collectively, the "Banks"), Bankers Trust
Company, as Administrative Agent (in such capacity and together with any
successor administrative agent, the "Administrative Agent"), Bank of America
National Trust & Savings Association, as Syndication Agent, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Credit
Partners L.P. and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding, Inc., as Co-Documentation
Agents, and Bank of America National Trust & Savings Association, Bankers Trust
Company, ▇▇▇▇▇▇▇ Sachs Credit Partners L.P. and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding,
Inc., as Co-Arrangers (in such capacity, the "Co- Arrangers"), have entered into
a Credit Agreement, dated as of July 29, 1997 (as amended, modified or
supplemented from time to time, the "Credit Agreement"), providing for the
making of Loans to, and the issuance of Letters of Credit for the account of,
the Borrowers as contemplated therein (the Banks, the Administrative Agent, the
Collateral Agent and the Co-Arrangers are collectively referred to herein as the
"Bank Creditors");
WHEREAS, one or more of the Borrowers are, or may from time to
time in the future be, party to one or more Interest Rate Protection Agreements
with any Bank or an
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affiliate of a Bank (each such Bank or affiliate, even if the respective Bank
subsequently ceases to be a Bank under the Credit Agreement for any reason,
together with such Bank's or affiliate's successors and assigns, are herein
called the "Other Creditors", and together with the Bank Creditors, the "Secured
Creditors");
WHEREAS, pursuant to the Borrowers/Subsidiaries Guaranty, each
Assignor has jointly and severally guaranteed to the Secured Creditors the
payment when due of all obligations and liabilities of each Borrower under or
with respect to the Credit Documents and the Interest Rate Protection
Agreements;
WHEREAS, it is a condition precedent to the making of Loans to
each Borrower and the issuance of Letters of Credit for the account of each
Revolving Borrower under the Credit Agreement that the Assignors shall have
executed and delivered to the Collateral Agent this Agreement; and
WHEREAS, each Assignor desires to execute this Agreement to
satisfy the conditions 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 for the benefit of the Secured Creditors and hereby covenants
and agrees with the Collateral Agent for the benefit of the Secured Creditors 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 of its Obligations,
each Assignor does hereby assign and transfer unto the Collateral Agent, and
does hereby pledge and grant to the Collateral Agent, in each case for the
benefit of the Secured Creditors, a continuing security interest of first
priority, subject only to Permitted Liens, 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
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time acquired: (i) each and every Receivable, (ii) all Contracts (other than
Excluded Contracts, except to the extent provided in the definition thereof),
together with all Contract Rights arising thereunder, (iii) all Inventory, (iv)
all Equipment, (v) 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, (vi) all Patents and Copyrights, (vii) all computer programs of
such Assignor and all intellectual property rights therein (to the extent not
constituting Excluded Contracts, except to the extent provided in the definition
thereof) and all other proprietary information of such Assignor, including, but
not limited to, trade secrets and Trade Secret Rights, (viii) all other Goods,
General Intangibles, Chattel Paper, Documents and Instruments (other than
Pledged Securities), (ix) the Cash Collateral Account and all monies, securities
and instruments deposited or required to be deposited in such Cash Collateral
Account, and (x) all Proceeds and products of any and all of the foregoing (all
of the above, collectively, the "Collateral"). Notwithstanding the foregoing,
the term "Collateral" shall not include any Receivable and related asset from
and after the time that same is transferred to the Receivables Subsidiary
pursuant to the Accounts Receivable Facility Documents.
(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 reasonably necessary or advisable to
protect the interests of the Secured Creditors, which appointment as attorney is
coupled with an interest.
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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 and perfect the security
interest granted by such Assignor to the Collateral Agent hereby in respect of
the Collateral have been accomplished or will be accomplished within 10 Business
Days from the date hereof and, upon such filings, registrations or recordations,
the security interest granted to the Collateral Agent pursuant to this Agreement
in and to the Collateral creates 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 Uniform Commercial Code or other relevant law as enacted in any
relevant jurisdiction to perfected security interests, in each case to the
extent that the Collateral consists of the type of property in which a security
interest may be perfected by filing a financing statement under the Uniform
Commercial Code as enacted in any relevant jurisdiction or by the filing of an
Assignment of Security Interest in the form of Annex G or H hereto in the United
States Patent and Trademark Office or the United States Copyright Office, as the
case may be.
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, or has rights in, all Collateral free from any Lien, security interest,
encumbrance or other right, title or interest of any Person (other than
Permitted Liens), and such Assignor shall defend the Collateral to the extent of
its rights therein against all claims and demands of all Persons at any time
claiming the same or any interest therein adverse to the Collateral Agent (other
than in respect of Permitted Liens).
2.3. Other Financing Statements. As of the date hereof, there
is no financing statement (or similar state- ment 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 financing
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statements filed in respect of Permitted Liens), and so long as the Total
Commitment has not been terminated or any Note remains unpaid or any of the
Obligations remain unpaid (other than indemnities described in Section 8.1
hereof and described in Section 12.13 of the Credit Agreement, and any other
indemnities set forth in any other Security Document, in each case which are not
then due and payable) or any Interest Rate Protection Agreement entitled to the
benefits of this Agreement or Letter of Credit 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 for such Assignor. 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 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, at one or
more of the locations set forth on Annex A hereto 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 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 and (ii) with respect to such new
location, it shall have taken all action, reasonably 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.
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2.5. Location of Inventory and Equipment. All Inventory and
Equipment (other than Equipment and Inventory the aggregate fair market value of
which does not exceed $250,000 or Inventory held on consignment) held on the
date hereof by each Assignor is located at one of the locations shown on Annex B
hereto for such Assignor or is in transport thereto. 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. 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 10 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 and (ii)
with respect to such new location, it shall have taken all action reasonably
satisfactory to the Collateral Agent to maintain the secur- ity interest of the
Collateral Agent in the Collateral in- tended to be granted hereby at all times
fully perfected and in full force and effect.
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 entitled to
the benefits of this Agreement 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 in the preceding 12 months has had or has operated
in any jurisdiction 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 and new names 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 until (i) it shall
have given to the Collateral Agent not less than 10 days' prior written notice
of its intention so to do, clearly describing such new name and the
jurisdictions in which such new name shall be used and providing such other
information in connection therewith as
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the Collateral Agent may reasonably request and (ii) with respect to such new
name, it shall have taken all action reasonably requested by 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.
ARTICLE III
SPECIAL PROVISIONS CONCERNING
RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS
3.1. Additional Representations and Warranties. As of the time
when each of its Receivables (other than Receivables in an immaterial aggregate
amount) 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 what they purport to be, and that all papers and documents (if any)
relating thereto 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).
3.2. Maintenance of Records. Each Assignor will keep and
maintain at its own cost and expense accurate records of its Receivables and
Contracts, 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, to the extent permitted by,
and subject to, the conditions set forth in the Credit Agreement. 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). Upon the occurrence and during the continuance of an Event of Default
and 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 (if any) of such Assignor evidencing or
pertaining to such Receivables and Contracts with an appropriate reference to
the fact that
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such Receivables and Contracts have been assigned to the Collateral Agent and
that the Collateral Agent has a security interest therein.
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 the 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 reasonable attorneys' fees) of
collection, whether incurred by the Assignor or the Collateral Agent, shall be
borne by the relevant Assignor. The Collateral Agent shall deliver a copy of
each notice referred to in the preceding clause (y) to the relevant Assignor;
provided, that the failure by the Collateral Agent to so notify such Assignor
shall not affect the effectiveness of such notice or the other rights of the
Collateral Agent created by this Section 3.3.
3.4. Modification of Terms; etc. Except (x) as permitted under
the Credit Agreement, (y) as permitted by Section 3.5 hereof or (z) in the
ordinary course of business and consistent with past practice, no Assignor shall
rescind or cancel any indebtedness evidenced by any Receivable or under any
Contract, or modify in any material respect any term thereof or make any
material 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. Each Assignor will
duly fulfill all of its material obligations on its part to be fulfilled under
or in connection with the Receivables and Contracts and will do nothing to
impair the security
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interest of the Collateral Agent in the Receivables or Contracts.
3.5. Collection. Each Assignor shall endeavor in accordance
with reasonable business practices 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 which are delinquent, such
amounts to be collected in accordance with generally accepted lawful collection
procedures) any and all amounts owing under or on account of such Receivable or
Contract, and apply forthwith upon receipt thereof all such amounts 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 owing under
its Receivables and Contracts (i) an extension or renewal of the time or times
of payment, 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 or for other reasons which such Assignor finds
appropriate in accordance with reasonable business judgment. The reasonable
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 in excess of $100,000 and having a maturity
of longer than 60 days, such Assignor will within 10 Business 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. Assignors Remain Liable Under Receivables. Anything
herein to the contrary notwithstanding, the Assignors shall remain liable under
each of the Receivables to observe and perform all of the conditions and
obligations to be observed and performed by it thereunder, all in accordance
with the terms of any agreement giving rise to such Receivables. Neither the
Collateral Agent nor any other Secured Creditor shall have any obligation or
liability under any Receivable (or any agreement giving rise thereto) by reason
of or arising out of this Agreement or the receipt by the Collateral Agent or
any other Secured
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Creditor of any payment relating to such Receivable pursuant hereto, nor shall
the Collateral Agent or any other Secured Creditor be obligated in any manner to
perform any of the obligations of any Assignor under or pursuant to any
Receivable (or any agreement giving rise thereto), to make any payment, to make
any inquiry as to the nature or the sufficiency of any payment received by them
or as to the sufficiency of any performance by any party under any Receivable
(or any agreement giving rise thereto), to present or file any claim, to take
any action to enforce any performance or to collect the payment of any amounts
which may have been assigned to them or to which they may be entitled at any
time or times.
3.8. Assignors Remain Liable Under Contracts. Anything herein
to the contrary notwithstanding, the Assignors shall remain liable under each of
the Contracts to observe and perform all of the conditions and obligations to be
observed and performed by them thereunder, all in accordance with and pursuant
to the terms and provisions of each Contract. Neither the Collateral Agent nor
any other Secured Creditor shall have any obligation or liability under any
Contract by reason of or arising out of this Agreement or the receipt by the
Collateral Agent or any other Secured Creditor of any payment relating to such
contract pursuant hereto, nor shall the Collateral Agent or any other Secured
Creditor be obligated in any manner to perform any of the obligations of any
Assignor under or pursuant to any Contract, to make any payment, to make any
inquiry as to the nature or the sufficiency of any performance by any party
under any Contract, to present or file any claim, to take any action to enforce
any performance or to collect the payment of any amounts which may have been
assigned to them or to which they may be entitled at any time or times.
3.9. 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 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 reasonably require.
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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
or otherwise has the right to use the material registered Marks listed in Annex
D hereto for such Assignor, and that said listed Marks include all the United
States marks and applications for United States marks registered in the United
States Patent and Trademark Office that such Assignor presently owns or uses in
connection with its business. Each Assignor represents and warrants that it
owns, is licensed to use or otherwise has the right to use all material Marks
that it uses. Each Assignor further warrants that it has no knowledge of any
material third party claim that any aspect of such Assignor's present or
contemplated business operations infringes or will infringe in any material
respect any trademark, service ▇▇▇▇ or trade name. 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 United States Patent and Trademark Office or secretary of state
or equivalent governmental agency of any State of the United States in order to
effect an absolute assignment of all right, title and interest in each ▇▇▇▇, and
record the same.
4.2. Licenses and Assignments. Except as otherwise permitted
by the Credit Agreement or this Agreement, each Assignor hereby agrees not to
divest itself of any right under any ▇▇▇▇ absent prior written approval of the
Collateral Agent.
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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, any party who such Assignor believes is infringing or diluting or
otherwise violating in any material respect any of such Assignor's rights in and
to any material ▇▇▇▇, or with respect to any party claiming that such Assignor's
use of any material ▇▇▇▇ violates in any material respect any property right of
that party. Each Assignor further agrees, unless otherwise agreed by the
Collateral Agent, to prosecute any Person infringing any material ▇▇▇▇ owned by
such Assignor in accordance with reasonable business practices.
4.4. Preservation of Marks. Each Assignor agrees to use its
material Marks in interstate commerce during the time in which this Agreement is
in effect, sufficiently to preserve such Marks as trademarks or service marks
under the laws of the United States; provided, that no Assignor shall be
obligated to preserve, or prosecute any Person infringing, any ▇▇▇▇ in the event
such Assignor determines, in its reasonable business judgment, that the
preservation of such ▇▇▇▇ is no longer desirable in the conduct of its business.
4.5. Maintenance of Registration. Each Assignor shall, at its
own expense, diligently process all documents required by the Trademark Act of
1946, 15 U.S.C. ▇▇.▇▇. 1051 et seq. to maintain trademark registrations,
including but not limited to affidavits of 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. ▇▇.▇▇. 1058(a), 1059 and 1065, 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; provided, that no Assignor shall be obligated
to maintain the registration of any ▇▇▇▇ in the event that such Assignor
determines, in its reasonable business judgment, that the maintenance of such
▇▇▇▇ is no longer necessary or desirable in the conduct of its business. Each
Assignor agrees to notify the Collateral Agent thirty (30) days prior to the
dates on which the affidavits of use or the applications for renewal
registration are due with respect to any registered ▇▇▇▇ which is required to be
maintained pursuant to this Section
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4.5, that the affidavits of use or the renewal is being processed or being
abandoned, as the case may be.
4.6. Future Registered Marks. If any ▇▇▇▇ registration 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 reasonably 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, 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 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 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 application in the United States Patent and Trademark Office or any
equivalent government agency or office in any foreign jurisdiction to the
Collateral Agent.
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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) the material Patents listed in Annex E hereto for such Assignor
and that said listed Patents constitute all the patents and applications for
patents that such Assignor now owns and (ii) the material Copyrights listed in
Annex F hereto for such Assignor and that said listed Copyrights constitute all
material registrations of copyrights and applications for copyright
registrations that such Assignor now owns. Each Assignor further represents and
warrants that it is the true and lawful exclusive owner or licensee of all
rights in all material United States trade secrets and proprietary information
necessary to operate the business of the Assignor (the "Trade Secret Rights").
Each Assignor further represents and warrants that it has the exclusive right to
use and practice under all material Patents and material Copyrights that it
owns, uses or practices under and has the exclusive right to exclude others from
using or practicing under any material Patents it owns, uses or practices under.
Each Assignor further warrants that, as of the date hereof it has no knowledge
of any material third party claim that any aspect of such Assignor's present or
contemplated business operations infringes or will infringe in any material
respect any rights in any patent or copyright or such Assignor has
misappropriated in any material respect 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
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Security Interest in registered United States Copyrights covering all right,
title and interest in each registered 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 the U.S. Copyright Office in order to effect
an absolute assignment of all right, title and interest in each Patent and
registered Copyright, and to record the same.
5.2. Licenses and Assignments. Except as otherwise permitted
by the Credit Agreement or this Agreement, each Assignor hereby agrees not to
divest itself of any right under any Patent or Copyright absent prior written
approval of the Collateral Agent.
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 any infringement,
contributing infringement or active inducement to infringe in any material
Patent or material Copyright or to any claim that the practice of any material
Patent or the use of any material Copyright violates any property right of a
third party, or with respect to any misappropriation of any material Trade
Secret Right or any claim that practice of any material 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 material Patent or material Copyright or any
Person misappropriating any material 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 ▇.▇.▇.▇▇. 41 to maintain in force rights under each
Patent, and to apply as permitted pursuant to applicable law for any renewal of
each Copyright, in any case absent prior written consent of the Collateral
Agent; provided, that no Assignor shall be obligated to maintain, or prosecute
any Person infringing, any Patent or Copyright in the event such Assignor
determines, in its reasonable business judgment, that the maintenance of such
Patent or Copyright is no longer necessary or desirable in the conduct of its
business.
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5.5. Prosecution of Patent and Copyright Applications. 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 for
such Assignor and shall not abandon any such application prior to exhaustion of
all administrative and judicial remedies, absent written consent of the
Collateral Agent; provided, that no Assignor shall be obligated to prosecute any
such application in the event such Assignor determines, in its reasonable
business judgment, that the prosecuting of such application is no longer
necessary or desirable in the conduct of its business.
5.6. Other Patents and Copyrights. Within 30 days of the
acquisition or issuance of a United States Patent, registration of a Copyright,
or acquisition of a registered Copyright, or of filing of an application for a
United States Patent or Copyright, the relevant Assignor shall deliver to the
Collateral Agent a copy of said Copyright or certificate or registration of, or
application therefor, said Patents, 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 reasonably 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, Copyright 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 Trade Secret Rights directly or
indirectly, and such Assignor shall execute such other and further documents as
the Collateral Agent may reasonably request further to
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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. Except as may
be permitted by this Agreement and the Credit Agreement, 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. 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. Except to the extent proceeds of insurance are permitted to be
retained by the relevant Assignor pursuant to the Credit Agreement, 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 As- ▇▇▇▇▇▇ 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
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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 security interest in the
Collateral.
6.4. Financing Statements. Each Assignor agrees to execute and
deliver to the Collateral Agent such financing statements, in form reasonably
acceptable to the Collateral Agent, as the Collateral Agent may from time to
time reasonably 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, as the Collateral Agent shall reasonably deem
necessary or desirable, 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:
(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
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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 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 reasonable working condition; and
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(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 (taking into
account such provisions as may be necessary to protect and preserve
such Marks, Patents or Copyrights);
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. The
Secured Creditors agree that this Agreement may be enforced only by the action
of the Administrative Agent or the Collateral Agent, in each case acting upon
the instructions of the Required Secured Creditors and that no other Secured
Creditor shall have any right individually to seek to enforce or to enforce this
Agreement or to realize upon the security to be granted hereby, it being
understood and agreed that such rights and remedies may be exercised by the
Administrative Agent or the Collateral Agent for the benefit of the Secured
Creditors upon the terms of this Agreement.
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,
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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 in the City of New York. To the extent permitted by any such
requirement of law, the Collateral Agent may bid for and become the purchaser of
the Collateral 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.
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 each Assignor hereby further waives, to the extent
permitted by law:
(i) all damages occasioned by such taking of possession
except to the extent that 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
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(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 (or, to the extent the Pledge Agreement, the Mortgages or the
Additional Security Documents require proceeds of collateral under such Security
Documents to be applied in accordance with the provisions of this Agreement, the
Pledgee or Mortgagee under such other Security Document) upon any sale or other
disposition of the Collateral, together with all other moneys received by the
Collateral Agent hereunder, shall be applied as follows:
(i) first, to the payment of all amounts 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 such 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
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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, all Unpaid Drawings and all Fees and (ii) in the case of the Other
Obligations, all amounts due under the Interest Rate Protection Agreements
entitled to the benefits of this Agreement (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 the 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 whose Primary Obligations or
Secondary Obligations, as the case may be, have not been paid in full to receive
an amount equal to
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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, by their acceptance of the
benefits hereof, 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 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 Administrative 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 Administrative Agent to the Collateral
Agent for distribution in accordance with Section 7.4(a) hereof.
(e) All payments required to be made hereunder shall be made
(x) if to the Bank Creditors, to the Administrative 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 Administrative 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 Administrative 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
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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 Administrative 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 are in existence.
(g) It is understood that the Assignors shall remain jointly
and severally liable to the extent of any deficiency between the amount of the
proceeds of the Collateral and the aggregate amount of the Obligations.
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, the other Credit Documents or 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 reasonable expenses, including attorneys' fees, and the amounts thereof
shall be included in such judgment.
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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
"Indemnitee," and collectively as "Indemni- tees") harmless from any and all
liabilities, obligations, damages, injuries, penalties, claims, demands,
actions, suits, judgments and any and all costs, expenses or disbursements (a)
(including reasonable attorneys' fees and expenses) (for the purposes of this
Section 8.1(a) the foregoing are collectively called "expenses") of whatsoever
kind and nature imposed on, asserted against or incurred by any of the
Indemnitees in any way relating to or arising out of this Agreement, any
Interest Rate Protection Agreement entitled to the benefits of this Agreement,
any other Credit Document or any other document executed in connection herewith
or therewith 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
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
-26-
damage), or contract claim; provided that no Indemnitee shall be indemnified
pursuant to this Section 8.1(a) for any expenses 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 reasonable 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) 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 and Letters of Credit and the payment of all other
Obligations and notwithstanding the discharge thereof.
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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.
"Administrative Agent" shall have the meaning provided in the
recitals to this Agreement.
"Agreement" shall mean this Security Agreement as the same may
be modified, supplemented or amended from time to time in accordance with its
terms.
"Assignor" shall have the meaning provided in the first
paragraph of 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.
"Borrower" shall have the meaning provided in the recitals to
this Agreement.
"Cash Collateral Account" shall mean a 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.
"Co-Arrangers" shall have the meaning provided in the
recitals to 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
first paragraph of this Agreement.
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"Contract Rights" shall mean all rights of any Assignor under
each Contract, including, without limitation, (i) any and all rights to receive
and demand payments under any or all Contracts, (ii) any and all rights to
receive and compel performance under any or all Contracts and (iii) any and all
other rights, interests and claims now existing or in the future arising in
connection with any or all Contracts.
"Contracts" shall mean all contracts between any Assignor and
one or more additional parties (including, without limitation, any Interest Rate
Protection Agreements, any partnership agreements and any limited liability
company agreements).
"Copyrights" shall mean any United States copyright owned by
any Assignor, including any registrations of any Copyrights, in the United
States Copyright Office, as well as any application for a United States
copyright registration now or hereafter made with the United States Copyright
Office 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.
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"Event of Default" shall mean any Event of Default under, and
as defined in, the Credit Agreement, any payment default with any Interest Rate
Protection Agreement entitled to the benefits of this Agreement (after the
expiration of any applicable grace period) and shall in any event, without
limitation, include any payment default on any of the Obligations after the
expiration of any applicable grace period.
"Excluded Contracts" shall mean one or more Contracts which
by their terms would be breached by the grant of the security interests created
therein pursuant to the terms of this Agreement (it being understood and agreed,
however, that notwithstanding the foregoing, all rights to payment for money due
or to become due pursuant to any such excluded contract shall be subject to the
security interests created by 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.
"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.
"Inventory" shall mean merchandise, inventory and goods, and
all additions, substitutions and replacements thereof, wherever located,
together with all goods, supplies, 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.
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"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 United States 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
and any trade dress including logos, trade names, company names, business names,
fictitious names, other business identifiers and/or designs used by any Assignor
in the United States.
"Obligations" shall mean (i) the full and prompt payment when
due (whether at the stated maturity, by acceleration or otherwise) of all
obligations (including obligations which, but for the automatic stay under
Section 362(a) of the Bankruptcy Code, would become due) and liabilities of each
Assignor, whether now existing or hereafter incurred under, arising out of or in
connection with any Credit Document to which each Assignor is a party (including
all such obligations and liabilities under the Borrowers/Subsidiaries Guaranty)
and the due performance and compliance by each Assignor with all of the terms
and conditions of each such Credit Document (all such obligations and
liabilities under this clause (i), except to the extent consisting of
obligations or indebtedness with respect to Interest Rate Protection Agreements
entitled to the benefits of this Agreement, 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 (including obligations which, but for the automatic stay under
Section 362(a) of the Bankruptcy Code, would become due) and liabilities of each
Assignor, whether now existing or hereafter incurred under, arising out of or in
connection with any Interest Rate Protection Agreement entitled to the benefits
of this Agreement (including all such obligations and liabilities of such
Assignor under the Borrowers/Subsidiaries Guaranty in respect of such Interest
Rate Protection Agreements (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
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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) above, after an Event of Default
shall have occurred and be continuing, the reasonable expenses of retaking,
holding, preparing for sale 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.
"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.
"Patents" shall mean any United States patent to which any
Assignor now or hereafter has title and any divisions or continuations thereof,
as well as any application for a United States patent now or hereafter made by
any Assignor.
"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.
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"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 goods sold or leased or services performed by such Assignor, whether now in
existence or arising from time to time hereafter, including, without limitation,
rights evidenced by an account, note, contract, 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, the sale of which gave rise thereto, (c) all guarantees,
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.
"Required Secured Creditors" shall mean (i) the Required
Banks (or, to the extent required by Section 12.12 of the Credit Agreement, each
of the Banks) under the Credit Agreement so long as any Credit Document
Obligations remain outstanding and (ii) in any situation not covered by the
preceding clause (i), the holders of a majority of the outstanding principal
amount of the Other Obligations.
"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.
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"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.
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:
c/o Silgan Holdings Inc.
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
(b) if to the Collateral Agent:
Bankers Trust Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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;
(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.
-34-
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 affected
thereby and the Collateral Agent (with the prior written consent of the Required
Secured Creditors; 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 entitled to the benefits of
this Agreement.
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 such Interest Rate Protection Agreement entitled to the benefits of this
Agreement; or (c) any amendment to or modification of any Credit Document or any
such Interest Rate Protection Agreement or any security for any of the
Obligations; whether or not any Assignor shall have notice or knowledge of any
of the foregoing.
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, except in accordance with the terms of the Credit Agreement. 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
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Creditors and shall survive the execution and delivery of this Agreement, the
other Credit Documents and the Interest Rate Protection Agreements entitled to
the benefits of this Agreement 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 earlier of (i) the date upon
which the Total Commitment and all Interest Rate Protection Agreements entitled
to the benefits of this Agreement have been terminated, no Note or Letter of
Credit is outstanding and all other Obligations (other than indemnities
described in Section 8.1 hereof and described in Section 12.13 of the Credit
Agreement, and any
-36-
other indemnities set forth in any other Security Documents, in each case which
are not then due and payable) have been paid in full and (ii) that date upon
which the conditions described in Section 12.17(b) of the Credit Agreement with
respect to the release of the collateral under all of the Security Documents
shall have been satisfied and Silgan shall have requested the release of such
collateral under such Security Documents.
(b) In the event that any part of the Collateral is sold in
connection with a sale permitted by Section 8.02 of the Credit Agreement or is
otherwise released at the direction of the Required Secured Creditors, the
Collateral Agent, at the request and expense of such Assignor, will duly release
from the security interest created hereby (and will execute and deliver such
documentation, including UCC- 3 termination or partial release statements and
the like in connection therewith) and 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 an authorized
officer of such Assignor stating that the release of the respective Collateral
is permitted pursuant to Section 10.8(a) or (b) hereof.
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
Assignors and the Collateral Agent.
10.10. The Collateral Agent. The Collatera 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
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Collateral Agent shall act hereunder on the terms and conditions set forth in
Section 11 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. Additional Assignors. It is understood and agreed that
any Subsidiary of Silgan 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.
-38-
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.
SILGAN HOLDINGS INC.,
as an Assignor
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------------
Title: Vice President, General Counsel
and Secretary
SILGAN CONTAINERS
CORPORATION, as an
Assignor
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------------
Title: Vice President, General Counsel
and Secretary
SILGAN PLASTICS CORPORATION,
as an Assignor
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------------
Title: Vice President, General Counsel
and Secretary
CALIFORNIA-WASHINGTON CAN
CORPORATION, as an
Assignor
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------------
Title: Vice President, General Counsel
and Secretary
SCCW CAN CORPORATION,
as an Assignor
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------------
Title: Vice President, General Counsel
and Secretary
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BANKERS TRUST COMPANY,
as Collateral Agent
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------
Title: Vice President
-40-