EXHIBIT 9
SECOND PRIORITY NOTES SECURITY AGREEMENT
Dated as of September 30, 2004
From
The Grantors referred to herein
as Grantors
-----------
to
HSBC BANK USA, NATIONAL ASSOCIATION
as Trustee and Collateral Agent,
--------------------------------
and the other Second Priority Secured Parties referred to herein
TABLE OF CONTENTS
SECTION PAGE
Section 1. Grant of Security.....................................................................3
Section 2. Security for Obligations..............................................................3
Section 3. Grantors Remain Liable................................................................3
Section 4. Delivery and Control of Security Collateral...........................................4
Section 5. Maintaining the Account Collateral....................................................6
Section 6. Investing of Amounts in the Collateral Accounts.......................................7
Section 7. Maintaining Electronic Chattel Paper and Transferable Records.........................8
Section 8. Representations and Warranties........................................................8
Section 9. Further Assurances...................................................................10
Section 10. Post-Closing Changes; Bailees; Collections on Support Agreement; Receivables
and Related Contracts................................................................12
Section 11. Voting Rights; Dividends; Etc........................................................13
Section 12. As to the Support Agreement..........................................................15
Section 13. Transfers and Other Liens; Additional Shares.........................................16
Section 14. Second Priority Notes Collateral Agent Appointed Attorney-in-Fact....................16
Section 15. Second Priority Notes Collateral Agent May Perform...................................17
Section 16. The Second Priority Notes Collateral Agent's Duties..................................17
Section 17. Remedies.............................................................................18
Section 18. Indemnity and Expenses...............................................................22
Section 19. Amendments; Waivers; Additional Grantors; Etc........................................23
Section 20. Notices, Etc.........................................................................23
Section 21. Continuing Security Interest.........................................................24
Section 22. Release of Collateral; Termination...................................................24
Section 23. Security Interest Absolute...........................................................24
Section 24. Execution in Counterparts............................................................26
Section 25. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc...............................26
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Schedule I - Location, Chief Executive Office, Place Where Agreements
Are Maintained, Type of Organization, Jurisdiction Of
Organization And Organizational Identification Number
Schedule II - Pledged Equity and Pledged Debt
Schedule III - Assigned Agreement Schedule
Schedule IV - Changes in Name, Location, Etc.
Exhibits
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Exhibit A - Form of Security Agreement Supplement
Exhibit B - Form of Account Control Agreement
Exhibit C - Form of Consent and Agreement of RMI
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SECOND PRIORITY NOTES SECURITY AGREEMENT
SECOND PRIORITY NOTES SECURITY AGREEMENT dated as of September
30, 2004 made by ▇▇▇▇▇▇▇▇▇ INC., a Canadian corporation (the "COMPANY"),
RAVELSTON MANAGEMENT INC., an Ontario corporation ("RMI"), and 504468 N.B. INC.,
a New Brunswick corporation ("NBI"), and the Additional Grantors (as defined in
Section 19) (the Company, RMI, NBI, and the Additional Grantors being,
collectively, the "GRANTORS"), to HSBC BANK USA, NATIONAL ASSOCIATION, as
Trustee and Collateral Agent under the Second Priority Notes Indenture (as
hereinafter defined) (in such capacity, together with any successor appointed
pursuant to the Second Priority Notes Indenture, the "SECOND PRIORITY NOTES
COLLATERAL AGENT") for itself, each of the Holders (as defined in the Second
Priority Notes Indenture), and each other secured party specified in any of the
other Second Priority Note Documents (as hereinafter defined) (collectively, the
"SECOND PRIORITY SECURED PARTIES"). Terms used herein but not otherwise defined
herein shall have the meanings ascribed thereto in the Second Priority Notes
Indenture (as defined herein).
PRELIMINARY STATEMENTS
(1) The Company, as issuer, and RMI and NBI, as guarantors,
entered into an indenture dated as of March 10, 2003 (said indenture, as it may
hereafter be amended, amended and restated, supplemented or otherwise modified
from time to time, being the "FIRST PRIORITY NOTES Indenture") with The
Ravelston Corporation Limited, Sugra Limited and Wachovia Trust Company,
National Association (the "FIRST PRIORITY NOTES COLLATERAL AGENT").
(2) Pursuant to the First Priority Notes Indenture, the
Grantors entered into a security agreement, dated as of March 10, 2003 (said
security agreement, as it may hereafter be amended, amended and restated,
supplemented or otherwise modified from time to time, being the "FIRST PRIORITY
NOTES SECURITY AGREEMENT"), in order to grant to the First Priority Notes
Collateral Agent for the ratable benefit of itself and the other First Priority
Secured Parties (as defined in the intercreditor agreement, dated as of the date
hereof, between the First Priority Notes Collateral Agent, the Second Priority
Notes Collateral Agent and the Company (the "FIRST PRIORITY NOTES INTERCREDITOR
AGREEMENT")) a first priority security interest in the Collateral (as defined in
the First Priority Notes Security Agreement).
(3) The Company, as issuer, and RMI and NBI, as guarantors,
have entered into an indenture dated as of September 30, 2004 (said indenture,
as it may hereafter be amended, amended and restated, supplemented or otherwise
modified from time to time, being the "SECOND PRIORITY NOTES INDENTURE") with
The Ravelston Corporation Limited, Sugra Limited and the Second Priority Notes
Collateral Agent.
(4) The Grantors are entering into this Agreement in order to
grant to the Second Priority Notes Collateral Agent for the ratable benefit of
itself and the other Second Priority Secured Parties (as defined in the First
Priority Notes Intercreditor Agreement) a second priority security interest in
the Collateral.
(5) Each of the Company and NBI is the owner of the shares of
stock or other equity interests (the "INITIAL PLEDGED EQUITY") set forth on and
described in Schedule II hereto and issued by the Persons named therein.
(6) The Company is a party to the Support Agreement, between
▇▇▇▇▇▇▇▇▇ Inc. and Ravelston Management Inc. dated as of March 10, 2003 (as
amended, amended and restated, or otherwise modified or supplemented from time
to time, the "SUPPORT AGREEMENT").
(7) RMI was a party to the Services Agreements (as defined in
the First Priority Notes Indenture) (the Services Agreements and the Support
Agreement hereinafter referred to as the "ASSIGNED AGREEMENTS").
(8) It is a condition precedent to the purchase of the Second
Priority Notes by the Holders and the performance by the Second Priority Secured
Parties of their respective obligations under this Agreement, the Second
Priority Notes Indenture, the Second Priority Notes, the First Priority Notes
Intercreditor Agreement, the other Security Documents or any other document or
agreement related thereto or delivered in connection therewith (collectively,
the "SECOND PRIORITY NOTE DOCUMENTS") that the Grantors shall have granted the
second priority assignment and security interest and made the pledge and
assignment contemplated by this Agreement.
(9) Each Grantor will derive substantial direct and indirect
benefit from the transactions contemplated by the Second Priority Note
Documents.
(10) Unless otherwise defined in this Agreement or the other
Second Priority Note Documents, terms defined in Article 8 or 9 of the UCC (as
defined below) and/or in the Federal Book Entry Regulations (as defined below)
are used in this Agreement as such terms are defined in such Article 8 or 9
and/or the Federal Book Entry Regulations. "UCC" means the Uniform Commercial
Code as in effect, from time to time, in the State of New York; provided that,
if perfection or the effect of perfection or non-perfection or the priority of
any security interest in any Collateral is governed by the Uniform Commercial
Code as in effect in a jurisdiction other than the State of New York, "UCC"`
means the Uniform Commercial Code as in effect from time to time in such other
jurisdiction for purposes of the provisions hereof relating to such perfection,
effect of perfection or non-perfection or priority. The term "FEDERAL BOOK ENTRY
REGULATIONS" means (a) the federal regulations contained in Subpart B
("TREASURY/RESERVE AUTOMATED DEBT ENTRY SYSTEM (TRADES)") governing book-entry
securities consisting of U.S. Treasury bonds, notes and bills and Subpart D
("ADDITIONAL PROVISIONS") of 31 C.F.R. Part 357, 31 C.F.R. ss. 357.2, ss. 357.10
through ss. 357.14 and ss. 357.41 through ss. 357.44 and (b) to the extent
substantially identical to, the federal regulations referred to in clause (a)
above (as in effect from time to time), the federal regulations governing other
book-entry securities. The term "PPSA(ON)" shall mean the Personal Property
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Security Act (Ontario) (or any successor statute} and the term "PPSA(NB)" shall
mean the Personal Property Security Act (New Brunswick) (or any successor
statute).
NOW, THEREFORE, in consideration of the premises and in order
to induce the Holders to purchase the Second Priority Notes, and each Second
Priority Secured Party to perform their respective obligations under the Second
Priority Note Documents, each Grantor hereby agrees with the Second Priority
Notes Collateral Agent and the other Second Priority Secured Parties as follows:
Section 1. Grant of Security. Each Grantor hereby grants,
assigns and transfers to the Second Priority Notes Collateral Agent and the
other Second Priority Secured Parties, a security interest in, such Grantor's
right, title and interest in and to the Collateral (as defined in the First
Priority Notes Security Agreement). Notwithstanding anything to the contrary
contained in this Agreement, the security interest granted pursuant to this
Agreement (including pursuant to this Section 1), shall be a "second" priority
security interest in the Collateral, fully junior, subordinated and subject to
the security interest granted pursuant to the First Priority Notes Security
Agreement to the holders of notes issued under the First Priority Notes
Indenture, and all other rights and benefits afforded hereunder to the Second
Priority Secured Parties are expressly subject to the terms and conditions of
the Second Priority Note Documents.
Section 2. Security for Obligations. This Agreement secures,
in the case of each Grantor, the payment of all obligations of such Grantor now
or hereafter existing under the Second Priority Note Documents, whether direct
or indirect, absolute or contingent, and whether for principal, reimbursement
obligations, interest, fees, premiums, penalties, indemnifications, contract
causes of action, costs, expenses or otherwise (all such obligations being the
"SECURED OBLIGATIONS"). Without limiting the generality of the foregoing, this
Agreement secures, as to each Grantor, the payment of all amounts that
constitute part of the Secured Obligations and would be owed by such Grantor,
whether incurred alone or with another or others and whether as principal,
guarantor or surety, to any Second Priority Secured Party under the Second
Priority Note Documents but for the fact that they are unenforceable or not
allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving a Grantor.
Section 3. Grantors Remain Liable. Anything herein to the
contrary notwithstanding, (a) each Grantor shall remain liable under the
contracts and agreements included in such Grantor's Collateral to the extent set
forth therein to perform all of its duties and obligations thereunder to the
same extent as if this Agreement had not been executed, (b) the exercise by the
Second Priority Notes Collateral Agent or any other Second Priority Secured
Party of any of the rights hereunder shall not release any Grantor from any of
its duties or obligations under the contracts and agreements included in the
Collateral and (c) neither the Second Priority Notes Collateral Agent nor any
other Second Priority Secured Party shall have any obligation or liability under
the contracts and agreements included in the Collateral by reason of this
Agreement or any other Second Priority Note Documents, nor shall the Second
Priority Notes Collateral Agent or any other Second Priority Secured Party be
obligated to perform any of the obligations or duties of any Grantor thereunder
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or to take any action to collect or enforce any claim for payment assigned
hereunder. Furthermore, the Second Priority Notes Collateral Agent shall not be
liable or accountable for any failure to seize, collect, realize, dispose of,
enforce or otherwise deal with the Collateral, shall not be bound to institute
proceedings for any such purposes or for the purpose of preserving any rights of
the Second Priority Notes Collateral Agent, the Grantor or any other person,
firm or corporation in respect of the Collateral and shall not be liable or
responsible for any loss, cost or damage whatsoever which may arise in respect
of any such failure including, without limitation, resulting from the negligence
of the Second Priority Notes Collateral Agent or any of its officers, servants,
agents, solicitors, attorneys, Receivers (as hereinafter defined) or otherwise.
Neither the Second Priority Notes Collateral Agent nor its officers, servants,
agents or Receivers shall be liable by reason of any entry into possession of
the Collateral or any part thereof, to account as a mortgagee in possession, for
anything except actual receipts, for any loss on realization, for any act or
omission for which a mortgagee in possession might be liable for any loss, cost,
damage or expense whatsoever which may arise in respect of any such actions,
omissions or negligence.
Section 4. Delivery and Control of Security Collateral.
(a) Prior to any Collateral Transfer (as defined below), the
Company's obligations with respect to delivery and control of the
Collateral shall be solely to comply with the provisions of Section 4
of the First Priority Security Agreement. Pursuant to the First
Priority Notes Intercreditor Agreement, in the event that (i) all of
the Collateral is released from the Lien under the First Priority Notes
Indenture, or (ii) the First Priority Notes Collateral Agent, acting on
behalf of the First Priority Note Secured Parties (as defined in the
First Priority Notes Intercreditor Agreement), has foreclosed or
otherwise realized upon any or all of the Collateral, the First
Priority Notes Collateral Agent is required to transfer and deliver to
the Second Priority Notes Collateral Agent such portion of the
Collateral remaining after satisfaction of all Secured Obligations (as
defined in the First Priority Notes Indenture) then outstanding (the
"TRANSFERRED COLLATERAL") and the making of such other payments as the
First Priority Notes Collateral Agent is required to make pursuant to
Section 14.05 of the First Priority Notes Indenture (such transfer and
delivery, a "COLLATERAL TRANSFER"). The Second Priority Notes
Collateral Agent shall thereafter have the right, at any time in its
discretion and with notice to each Grantor, to transfer to or to
register in the name of the Second Priority Notes Collateral Agent or
any of its nominees any or all of the Security Collateral (as defined
in the First Priority Security Agreement) included in the Transferred
Collateral, provided, however, that in, the case of Security Collateral
included in the Transferred Collateral consisting of Class B Shares of
▇▇▇▇▇▇▇▇▇ International Inc., such rights to register Security
Collateral in the name of the Second Priority Notes Collateral Agent or
any of its nominees shall only be exercised only after the occurrence
and during the continuance of an Event of Default. In addition, the
Second Priority Notes Collateral Agent shall have the right at any time
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to exchange certificates or instruments representing or evidencing
Security Collateral included in the Transferred Collateral for
certificates or instruments of smaller or larger denominations. Also,
the Second Priority Notes Collateral Agent shall have the right at any
time to convert Security Collateral included in the Transferred
Collateral consisting of financial assets credited to the Collateral
Account (as defined in the First Priority Notes Security Agreement) to
Security Collateral consisting of financial assets held directly by the
Second Priority Notes Collateral Agent, and to convert Security
Collateral included in the Transferred Collateral consisting of
financial assets held directly by the Second Priority Notes Collateral
Agent, to Security Collateral consisting of financial assets credited
to the Collateral Accounts.
(b) From and after a Collateral Transfer, with respect to any
Security Collateral included in the Transferred Collateral in which any
Grantor has any right, title or interest and that constitutes an
uncertificated security, such Grantor will cause the issuer thereof
either (i) to register the Second Priority Notes Collateral Agent as
the registered owner of such security or (ii) to agree in an
authenticated record with such Grantor and the Second Priority Notes
Collateral Agent that such issuer will comply with instructions with
respect to such security originated by the Second Priority Notes
Collateral Agent without further consent of such Grantor, such
authenticated record to be in form and substance satisfactory to the
Second Priority Notes Collateral Agent. From and after a Collateral
Transfer, with respect to any Security Collateral included in the
Collateral, other than any Class B Shares of ▇▇▇▇▇▇▇▇▇ International
Inc., in which any Grantor has any right, title or interest and that is
not an uncertificated security, upon the request of the Second Priority
Notes Collateral Agent, such Grantor will notify each such issuer of
Pledged Equity (as defined in the First Priority Notes Security
Agreement) that such Pledged Equity is subject to the second priority
security interest granted hereunder.
(c) From and after a Collateral Transfer, with respect to any
Security Collateral included in the Transferred Collateral, in which
any Grantor has any right, title or interest and that constitutes a
security entitlement in which the Second Priority Notes Collateral
Agent is not the entitlement holder, such Grantor will cause the
securities intermediary with respect to such security entitlement
either (i) to identify in its records the Second Priority Notes
Collateral Agent as the entitlement holder of such security entitlement
against such securities intermediary or (ii) to agree in an
authenticated record with such Grantor and the Second Priority Notes
Collateral Agent that such securities intermediary will comply with
entitlement orders (that is, notifications communicated to such
securities intermediary directing transfer or redemption of the
financial asset to which such Grantor has a security entitlement)
originated by the Second Priority Notes Collateral Agent without
further consent of such Grantor, such authenticated record to be in
substantially the form of Exhibit B hereto or otherwise in form and
substance satisfactory to the Second Priority Notes Collateral Agent
(such agreement being an "ACCOUNT CONTROL AGREEMENT").
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(d) From and after a Collateral Transfer, no Grantor will
change or add any securities intermediary that maintains any securities
account in which any of the Transferred Collateral, other than any
Class B Shares of ▇▇▇▇▇▇▇▇▇ International Inc., is credited or carried,
or change or add any such securities account, in each case without
first complying with the above provisions of this Section 4 in order to
perfect the second priority security interest granted hereunder in such
Transferred Collateral.
(e) Not later than 10 business days after any Collateral
Transfer, each Grantor with respect to Security Collateral included in
the Transferred Collateral shall (i) take and complete any and all
action necessary in order to ensure that all beneficial and registered
ownership interests in each item of such Security Collateral are held
by a single or two Grantors; (ii) provide the Second Priority Notes
Collateral Agent and/or any other Secured Party requesting the same
with evidence satisfactory to the Second Priority Notes Collateral
Agent and/or such other Secured Party that all such action described in
clause (i) above has been taken; and (iii) deliver to or in accordance
with the instructions of the Second Priority Notes Collateral Agent
original stock certificates and stock powers originally executed in
blank, all in form and substance satisfactory to the Second Priority
Notes Collateral Agent, reflecting any changes in ownership with
respect to any Security Collateral included in the Transferred
Collateral resulting from the actions described in clause (i) above.
Section 5. Maintaining the Account Collateral. So long as any
Secured Obligations remain outstanding:
(a) Each Grantor will maintain all Account Collateral only
with (i) prior to a Collateral Transfer, (A) the First Priority Notes
Collateral Agent or (B) in accordance with the First Priority Notes
Indenture or the First Priority Notes Security Agreement, or (ii) after
a Collateral Transfer, (A) the Second Priority Notes Collateral Agent
or (B) banks (the "PLEDGED ACCOUNT BANKS") that have agreed, in an
Account Control Agreement authenticated by the Grantor, the Second
Priority Notes Collateral Agent and the Pledged Account Banks, to (x)
comply with instructions originated by the Second Priority Notes
Collateral Agent directing the disposition of funds in the Account
Collateral without the further consent of the Grantor and (y) waive or
subordinate in favor of the Second Priority Notes Collateral Agent all
claims of the Pledged Account Banks (including, without limitation,
claims by way of a security interest, lien or right of setoff or right
of recoupment) to the Account Collateral, which authenticated record
shall be substantially in the form of Exhibit B hereto, or shall
otherwise be in form and substance satisfactory to the Second Priority
Notes Collateral Agent.
(b) Each Grantor agrees that it will not terminate any bank as
a Pledged Account Bank that, (i) at any time, has entered into an
Account Control Agreement with the First Priority Notes Collateral
Agent with respect to the Collateral or terminate any Account
Collateral included in the Collateral or (ii) after a Collateral
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Transfer, has entered into an Account Control Agreement with the Second
Priority Notes Collateral Agent with respect to the Transferred
Collateral or terminate any Account Collateral included in the
Transferred Collateral.
(c) After any Collateral Transfer, the Second Priority Notes
Collateral Agent shall have sole right to direct the disposition of
funds with respect to the Collateral Accounts included in the
Transferred Collateral, and it shall be a term and condition of the
Collateral Accounts included in the Transferred Collateral,
notwithstanding any term or condition to the contrary in any other
agreement relating to the Collateral Accounts, that no amount
(including, without limitation, interest on Cash Equivalents (as
defined in the First Priority Notes Security Agreement) credited
thereto) will be paid or released to or for the account of, or
withdrawn by or for the account of, any Grantor or any other Person
from the Collateral Accounts included in the Transferred Collateral.
(d) After any Collateral Transfer, the Second Priority Notes
Collateral Agent may, at any time and without notice to, or consent
from, the Grantor, transfer, or direct the transfer of, funds from the
Account Collateral included in the Transferred Collateral to satisfy
the Grantor's obligations under the Second Priority Note Documents if
an Event of Default shall have occurred and be continuing.
Section 6. Investing of Amounts in the Collateral Accounts.
From and after any Collateral Transfer:
(a) The Second Priority Notes Collateral Agent will, subject
to the provisions of Sections 5, 17 and 22, from time to time, at the
direction of the Company, (a) invest, or direct the applicable Pledged
Account Bank to invest, amounts received with respect to the Collateral
Accounts included in the Transferred Collateral in such Cash
Equivalents credited to (A) the Collateral Accounts included in the
Transferred Collateral or (B) in the case of Cash Equivalents
consisting of Securities Collateral included in the Transferred
Collateral, a securities account in which the Second Priority Notes
Collateral Agent is the securities intermediary or a securities account
subject to an Account Control Agreement, and (b) invest interest paid
on the Cash Equivalents referred to in clause (a) above, and reinvest
other proceeds of any such Cash Equivalents that may mature or be sold,
in each case in such Cash Equivalents credited in the same manner.
(b) Interest and proceeds that are not invested or reinvested
in Cash Equivalents as provided above shall be deposited and held in
the Collateral Accounts included in the Transferred Collateral; and the
Second Priority Notes Collateral Agent and other Second Priority
Secured Parties shall not be liable for any losses resulting from such
investments.
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(c) In addition, the Second Priority Notes Collateral Agent
shall have the right at any time to exchange, or direct the applicable
Pledged Account Bank to exchange, such Cash Equivalents for similar
Cash Equivalents of smaller or larger determinations, or for other Cash
Equivalents, credited to the Collateral Accounts included in the
Transferred Collateral.
Section 7. Maintaining Electronic Chattel Paper and
Transferable Records. From and after a Collateral Transfer, so long as any
Secured Obligation of any Grantor under any Second Priority Note Documents shall
remain unpaid, each Grantor will maintain all (i) electronic chattel paper
included in the Transferred Collateral so that the Second Priority Notes
Collateral Agent has control of the electronic chattel paper in the manner
specified in Section 9-105 of the UCC or pursuant to similar laws in Canada, as
applicable, and (ii) all transferable records included in the Transferred
Collateral so that the Second Priority Notes Collateral Agent has control of the
transferable records in the manner specified in Section 16 of the Uniform
Electronic Transactions Act, as in effect in the jurisdiction governing such
transferable record ("UETA") or pursuant to similar laws in Canada, as
applicable.
Section 8. Representations and Warranties. Each Grantor
represents and warrants as follows:
(a) Such Grantor's exact legal name, as defined in Section
9-503(a) of the UCC, and as evidenced pursuant to its Articles of
Incorporation/ Amalgamation in the jurisdiction of incorporation, is
correctly set forth in Schedule I hereto. Such Grantor has only the
trade names listed on Schedule IV hereto. Such Grantor is located
(within the meaning of Section 9-307 of the UCC) and has its chief
executive office and the office in which it maintains the original copy
of the Support Agreement to which such Grantor is a party and all
originals of all chattel paper that evidence Receivables (as defined in
the First Priority Notes Security Agreement) of such Grantor, in the
state or provincial jurisdiction set forth in Schedule I hereto. The
information set forth in Schedule I hereto with respect to such Grantor
is true and accurate in all respects. Such Grantor has not, within five
years prior to the date hereof, previously changed its name, location,
chief executive office, place where it maintains its agreements, type
of organization, jurisdiction of organization or organizational
identification number from those set forth in Schedule I hereto except
as disclosed in Schedule IV hereto.
(b) All Security Collateral consisting of certificated
securities and instruments have been delivered to the First Priority
Notes Collateral Agent. Original or certified copies of each Assigned
Agreement and all originals of all chattel paper that evidence
Receivables have been delivered to the First Priority Notes Collateral
Agent. None of the Receivables or Agreement Collateral (as defined in
the First Priority Notes Security Agreement) is evidenced by a
promissory note or other instrument that has not been delivered to the
First Priority Notes Collateral Agent.
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(c) Such Grantor is the legal and beneficial owner of the
Collateral of such Grantor free and clear of any Lien, claim, option or
right of others, except for the Liens of the First Priority Notes
Indenture and the Second Priority Notes Indenture and the related first
and second priority security interests created thereunder and pursuant
to the First Priority Notes Security Agreement and this Agreement. No
effective financing statement or other instrument similar in effect
covering all or any part of such Collateral or listing such Grantor or
any trade name of such Grantor as debtor is on file in any recording
office, except such as may have been filed in favor of the Second
Priority Notes Collateral Agent relating to the Second Priority Note
Documents and except in connection with or pursuant to the First
Priority Notes Indenture or the First Priority Notes Security
Agreement.
(d) The Pledged Equity pledged by such Grantor hereunder has
been duly authorized and validly issued and is fully paid and
non-assessable. With respect to the Pledged Equity that is an
uncertificated security, such Grantor has caused the issuer thereof
either (i) to register the First Priority Notes Collateral Agent as the
registered owner of such security or (ii) to agree in an authenticated
record with such Grantor and the First Priority Notes Collateral Agent
that such issuer will comply with instructions with respect to such
security originated by the First Priority Notes Collateral Agent
without further consent of such Grantor. If such Grantor is an issuer
of Pledged Equity, such Grantor confirms that it has received notice of
such security interest.
(e) The Initial Pledged Equity pledged by such Grantor
constitutes the percentage of the issued and outstanding equity
interests of the issuers thereof indicated on Schedule II hereto.
(f) The Support Agreement, a true and complete copy of which
has been furnished to the Second Priority Notes Collateral Agent, has
been duly authorized, executed and delivered by all parties thereto,
has not been amended, amended and restated, supplemented or otherwise
modified, is in full force and effect and is binding upon and
enforceable against all parties thereto in accordance with its terms.
Each party to the Support Agreement listed on Schedule III hereto other
than the Grantor has executed and delivered to such Grantor a consent,
in substantially the form of Exhibit C hereto or otherwise in form and
substance satisfactory to the Second Priority Notes Collateral Agent,
to the assignment of the Agreement Collateral to the Second Priority
Notes Collateral Agent pursuant to this Agreement.
(g) All filings and other actions (including, without
limitation, actions necessary to perfect the second priority security
interest in the Collateral of such Grantor created under this
Agreement) have been duly made or taken and are in full force and
effect, and this Agreement creates in favor of the Second Priority
Notes Collateral Agent for the benefit of itself and the other Second
Priority Secured Parties a valid and, together with such filings and
other actions, perfected second priority security interest in the
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Collateral of such Grantor, securing the payment of the Secured
Obligations.
(h) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for (i) the grant by such Grantor
of the second priority security interest granted hereunder or for the
execution, delivery or performance of this Agreement by such Grantor,
(ii) the perfection or maintenance of the second priority security
interest created hereunder (including the second priority nature of
such security interest), except for the filing of financing and
continuation statements under the UCC, the PPSA(ON) and the PPSA(NB),
which financing statements have been duly filed and are in full force
and effect, and the actions described in Section 4 with respect to
Security Collateral, which actions have been taken and are in full
force and effect, or (iii) the exercise by the Second Priority Notes
Collateral Agent of its rights provided for in this Agreement or the
remedies in respect of the Collateral pursuant to this Agreement,
except as may be required in connection with the disposition of any
portion of the Security Collateral by laws affecting the offering and
sale of securities generally.
Section 9. Further Assurances. (a) Each Grantor agrees that,
subject to the terms and conditions of the First Priority Notes Security
Agreement, from time to time, at the expense of such Grantor, such Grantor will
promptly execute and deliver, or otherwise authenticate, all, further
instruments and documents, and take all further action that may be necessary or
desirable, or that the Second Priority Notes Collateral Agent may request, in
order to perfect and protect any pledge or second priority security interest
granted or purported to be granted by such Grantor hereunder or to enable the
Second Priority Notes Collateral Agent to exercise and enforce its rights and
remedies hereunder with respect to any Collateral of such Grantor. Without
limiting the generality of the foregoing, except to the extent prohibited by
applicable law, the First Priority Notes Indenture or the First Priority Notes
Security Agreement, each Grantor will promptly with respect to Collateral of
such Grantor: (i) at the request of the Second Priority Notes Collateral Agent,
▇▇▇▇ conspicuously each chattel paper included in Receivables, the Support
Agreement and, at the request of the Second Priority Notes Collateral Agent,
each of its records pertaining to such Collateral with a legend, in form and
substance satisfactory to the Second Priority Notes Collateral Agent, indicating
that such chattel paper, Support Agreement or Collateral is subject to the
second priority security interest granted hereby; (ii) execute or authenticate
and file such financing, financing change or continuation statements, or
amendments thereto, and such other instruments or notices, as may be necessary
or desirable, or as the Second Priority Notes Collateral Agent may request, in
order to perfect and preserve the second priority security interest granted or
purported to be granted by such Grantor hereunder; (iii) take all action to
ensure that the Second Priority Notes Collateral Agent's second priority
security interest is noted on any certificate of ownership related to any
Collateral evidenced by a certificate of ownership (other than the Class B
Shares of ▇▇▇▇▇▇▇▇▇ International Inc.); and (iv) deliver to the Second Priority
Notes Collateral Agent evidence that all other action, except such actions in
10
each case that are prohibited by the First Priority Notes Indenture or the First
Priority Notes Security Agreement, that may be reasonably necessary or desirable
in order to perfect and protect the second priority security interest created by
such Grantor under this Agreement has been taken. From time to time upon request
by the Second Priority Notes Collateral Agent, each Grantor will, at such
Grantor's expense, cause to be delivered to the Second Priority Notes Collateral
Agent, for the benefit of the Second Priority Secured Parties, an Opinion of
Independent Counsel, from outside counsel reasonably satisfactory to the Second
Priority Notes Collateral Agent, as to such matters relating to the transactions
contemplated hereby as the Second Priority Notes Collateral Agent may reasonably
request.
(b) Each Grantor hereby authorizes the Second Priority Notes
Collateral Agent to file one or more financing, financing change or continuation
statements, and amendments thereto, including, without limitation, one or more
financing statements indicating that such financing statements cover all assets
or all personal property (or words of similar effect) of such Grantor, in each
case without the signature of such Grantor, and regardless of whether any
particular asset described in such financing statements falls within the scope
of the UCC, PPSA(ON) or PPSA(NB) or the granting clause of this Agreement. A
photocopy or other reproduction of this Agreement or any financing statement
covering the Collateral or any part thereof shall be sufficient as a financing
statement where permitted by law. Each Grantor ratifies its authorization for
the Second Priority Notes Collateral Agent to have filed such financing
statements, continuation statements, financing change statements or amendments
filed prior to the date hereof. In no event, however, will the Second Priority
Notes Collateral Agent have any duty, responsibility or obligation to file any
financing statement, continuation statement, financing change statement or
amendment.
(c) Each Grantor will furnish to the Second Priority Notes
Collateral Agent from time to time statements and schedules further identifying
and describing the Collateral of such Grantor and such other reports in
connection with such Collateral as the Second Priority Notes Collateral Agent
may reasonably request, all in reasonable detail.
(d) The Company will furnish to the Second Priority Notes
Collateral Agent, at any time upon the reasonable request of the Second Priority
Notes Collateral Agent, an opinion of counsel, from outside counsel reasonably
satisfactory to the Second Priority Notes Collateral Agent, to the effect that
all financing, financing change or continuation statements have been filed, and
all other action has been taken (including, without limitation, action necessary
to (i) give the First Priority Notes Collateral Agent control over the
Collateral as provided in Sections 9-104, 9-105, 9-106 and 9-107 of the UGC, in
Section 16 of UETA, in the PPSA(ON) and in the PPSA(NB) and (ii) cause the
second priority security interest in any Collateral evidenced by a certificate
of ownership, other than the Class B Shares of ▇▇▇▇▇▇▇▇▇ International Inc., to
be noted on such certificate of ownership) to perfect continuously from the date
hereof the second priority security interest granted hereunder.
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Section 10. Post-Closing Changes; Bailees; Collections on
Support Agreement; Receivables and Related Contracts. (a) Except to the extent
required by the First Priority Notes Indenture or the First Priority Notes
Security Agreement, no Grantor will change its name, type of organization,
jurisdiction of organization, organizational identification number or location
from those set forth in Section 5(a) of this Agreement without first giving at
least 30 days' prior written notice to the Second Priority Notes Collateral
Agent and taking all action required by the Second Priority Notes Collateral
Agent for the purpose of perfecting or protecting the second priority security
interest granted by this Agreement. Except to the extent required by the First
Priority Notes Indenture or the First Priority Notes Security Agreement, no
Grantor will change the place where it keeps the original of the Support
Agreement and all originals of all chattel paper that evidence Receivables of
such Grantor from the locations therefor specified in Sections 5(a) without
first giving the Second Priority Notes Collateral Agent 30 days' prior written
notice of such change. Except to the extent required by the First Priority Notes
Indenture or the First Priority Notes Security Agreement, no Grantor will become
bound by a security agreement authenticated by another Person which by its terms
may pertain to the Collateral (including, without limitation, a security
agreement authenticated as provided in Section 9-203(d) of the UCC) without
giving the Second Priority Notes Collateral Agent 30 days' prior written notice
thereof and taking all action required by the Second Priority Notes Collateral
Agent to ensure that the perfection and second priority nature of the Second
Priority Notes Collateral Agent's security interest in the Collateral will be
maintained. Except to the extent required by the First Priority Notes Indenture
or the First Priority Notes Security Agreement, each Grantor will hold and
preserve its records relating to the Collateral, including, without limitation,
the Support Agreement, and will permit representatives of the Second Priority
Notes Collateral Agent at any time during normal business hours to inspect and
make abstracts from such records and other documents. If the Grantor does not
have an organizational identification number and later obtains one, it will
forthwith notify the Second Priority Notes Collateral Agent of such
organizational identification number.
(b) If any Collateral of any Grantor is at any time in the
possession or control of a warehouseman, bailee, processor or agent, other than
the First Priority Notes Collateral Agent or its designee, or if the Second
Priority Notes Collateral Agent so requests, such Grantor will (i) at any time,
notify such warehouseman, bailee, processor or agent of the second priority
security interest created hereunder and (ii) after a Collateral Transfer, (A)
instruct such warehouseman, bailee, processor or agent to hold all, such
Transferred Collateral solely for the Second Priority Notes Collateral Agent's
account subject only to the Second Priority Notes Collateral Agent's
instructions (which shall permit such Transferred Collateral to be removed by
such Grantor in the ordinary course of business until the Second Priority Notes
Collateral Agent notifies such warehouseman, bailee, processor or agent that an
Event of Default has occurred and is continuing), (B) use best efforts, to cause
such warehouseman, bailee, processor or agent to authenticate a record
acknowledging that it holds possession of such Transferred Collateral for the
Second Priority Notes Collateral Agent's benefit and shall act solely on the
instructions of the Second Priority Notes Collateral Agent without the further
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consent of the Grantor or any other Person, and (C) make such authenticated
record available to the Second Priority Notes Collateral Agent.
(c) Except as otherwise provided in this subsection (c), each
Grantor will continue to collect, at its own expense, all amounts due or to
become due such Grantor under the Support Agreement and Receivables. In
connection with such collections, such Grantor may take (and, at the Second
Priority Notes Collateral Agent's direction after the occurrence of a Collateral
Transfer and an Event of Default which is continuing, will take) such action as
such Grantor or, if applicable, the Second Priority Notes Collateral Agent, may
deem necessary or advisable to enforce collection of the Support Agreement and
Receivables; provided, however, that in the event that a Collateral Transfer has
occurred and an Event of Default has occurred and is continuing and the Second
Priority Notes Collateral Agent has given written notice thereof to the
applicable Grantor(s) in respect thereof and to the obligors thereunder, the
Second Priority Notes Collateral Agent shall have the right to make payment of
100% of all amounts payable under the Support Agreement directly to the Second
Priority Notes Collateral Agent for so long as such Event of Default shall
continue, and, upon any such notification and at the expense of such Grantor, to
enforce collection of the Support Agreement and any such Receivables, to adjust,
settle or compromise the amount or payment thereof, in the same manner and to
the same extent as such Grantor might have done, and to otherwise exercise all
rights with respect to the Support Agreement and such Receivables, including,
without limitation, those set forth set forth in Section 9-607 of the UCC or
pursuant to the PPSA(ON) or PPSA(NB). After receipt by any Grantor of the notice
from the Second Priority Notes Collateral Agent referred to in the proviso to
the preceding sentence, (i) all amounts and proceeds (including, without
limitation, instruments) that may be received by such Grantor in respect of the
Support Agreement and Receivables of such Grantor shall be received in trust for
the benefit of the Second Priority Notes Collateral Agent hereunder, shall be
segregated from other funds of such Grantor and shall be forthwith paid over to
the Second Priority Notes Collateral Agent in the same form as so received (with
any necessary indorsement) and for so long as the Event of Default giving rise
to such notice be continuing, applied as provided in Section 17(b) and (ii) such
Grantor will not adjust, settle or compromise the amount or payment of any
Receivable or amount due on the Support Agreement, release wholly or partly any
obligor thereof, or allow any credit or discount thereon. No Grantor will permit
or consent to the subordination of its right to payment under the Support
Agreement and any of the Receivables to any other indebtedness or obligations of
the obligor thereof.
Section 11. Voting Rights; Dividends; Etc. (a) Subject to the
terms and conditions of the First Priority Notes Indenture, the First Priority
Notes Security Agreement and the First Priority Notes Intercreditor Agreement,
so long as no Event of Default shall have occurred and be continuing:
(i) Each Grantor shall be entitled to exercise any
and all voting and other consensual rights pertaining to the
Security Collateral of such Grantor or any part thereof for
any purpose; provided, however, that such Grantor will not
exercise or refrain from exercising any such right with
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respect to the Security Collateral included in the Transferred
Collateral if such action would have a material adverse effect
on the value of the Security Collateral included in the
Transferred Collateral or any part thereof.
(ii) Each Grantor shall be entitled to receive and
retain any and all dividends, interest and other distributions
paid in respect of the Security Collateral of such Grantor if
and to the extent that the payment thereof is not otherwise
prohibited by the terms of the Second Priority Note Documents;
provided however, that any and all
(A) dividends, interest and other
distributions paid or payable other than in cash in
respect of, and instruments and other property
received, receivable or otherwise distributed in
respect of, or in exchange for, any Security
Collateral included in the Transferred Collateral,
(B) dividends and other distributions paid
or payable in cash in respect of any Security
Collateral included in the Transferred Collateral in
connection with partial or total liquidation or
dissolution or in connection with a reduction of
capital, capital surplus or paid-in-surplus, and
(C) cash paid, payable or otherwise
distributed in respect of principal of, or in
redemption of, or in exchange for, any Security
Collateral included in the Transferred Collateral
shall be, and shall be forthwith delivered to the Second Priority Notes
Collateral Agent to hold as, Security Collateral and shall, if received by such
Grantor, be received in trust for the benefit of the Second Priority Notes
Collateral Agent, be segregated from the other property or funds of such Grantor
and be forthwith delivered to the Second Priority Notes Collateral Agent as
Security Collateral in the same form as so received (with any necessary
indorsement).
(iii) The Second Priority Notes Collateral Agent will
execute and deliver (or cause to be executed and delivered) to
each Grantor all such proxies and other instruments as such
Grantor may reasonably request for the purpose of enabling
such Grantor to exercise the voting and other rights that it
is entitled to exercise pursuant to paragraph (i) above and to
receive the dividends or interest payments that it is
authorized to receive and retain pursuant to paragraph (ii)
above.
(b) Upon the occurrence and during the continuance of an Event
of Default, subject to the terms and conditions of the First Priority Notes
Indenture, the First Priority Notes Security Agreement and the First Priority
Notes Intercreditor Agreement, and after the occurrence of a Collateral
Transfer:
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(i) All rights of each Grantor (x) to exercise or
refrain from exercising the voting and other consensual rights
that it would otherwise be entitled to exercise pursuant to
Section 11(a)(i) shall, upon notice to such Grantor by the
Second Priority Notes Collateral Agent, cease and (y) to
receive the dividends, interest and other distributions that
it would otherwise be authorized to receive and retain
pursuant to Section 11(a)(ii) shall automatically cease, and
all such rights shall thereupon become vested in the Second
Priority Notes Collateral Agent, which shall thereupon have
the sole right to exercise or refrain from exercising such
voting and other consensual rights and to receive and hold as
Security Collateral such dividends, interest and other
distributions.
(ii) All dividends, interest and other distributions
that are received by any Grantor contrary to the provisions of
paragraph (i) of this Section 11(b) shall be received in trust
for the benefit of the Second Priority Notes Collateral Agent,
shall be segregated from other funds of such Grantor and shall
be forthwith paid over to the Second Priority Notes Collateral
Agent as Security Collateral in the same form as so received
(with any necessary indorsement).
Section 12. As to the Support Agreement. (a) The Company and
RMI will at their respective expense, except to the extent prohibited under
applicable law, the First Priority Notes Indenture or the First Priority Notes
Security Agreement:
(i) perform and observe all terms and provisions of
the Support Agreement to be performed or observed by it,
maintain the Support Agreement in full force and effect,
enforce the Support Agreement in accordance with the terms
thereof; and
(ii) furnish to the Second Priority Notes Second
Priority Notes Collateral Agent promptly upon receipt thereof
copies of all notices, requests and other documents received
by such Grantor, and notify the Second Priority Notes
Collateral Agent immediately of any claims, litigation or
default, under or pursuant to the Support Agreement, and from
time to time furnish to the Second Priority Notes Collateral
Agent such information and reports regarding the Support
Agreement and such other Collateral of such Grantor as the
Second Priority Notes Collateral Agent may reasonably request.
(b) Each of the Company and RMI agrees that it will not,
except to the extent otherwise permitted under the Second Priority Notes
Indenture or as otherwise required by applicable law or pursuant to the First
Priority Notes Indenture or the First Priority Notes Security Agreement:
15
(i) cancel or terminate the Support Agreement or
consent to or accept any cancellation or termination (other
than regularly scheduled termination by the terms of the
Support Agreement) thereof;
(ii) amend, amend and restate, supplement or
otherwise modify the Support Agreement or give any consent,
waiver (including, without limitation, any waiver of rights,
privileges, remedies or powers) or approval thereunder (except
for periodic renewals under identical terms);
(iii) take any action to waive any default under or
breach of any the Support Agreement; or
(iv) take any other action in connection with the
Support Agreement that would materially impair the value of
the interests or rights of such Grantor thereunder or that
would materially impair the interests or rights of the Second
Priority Notes Collateral Agent or any other Second Priority
Secured Party.
Section 13. Transfers and Other Liens; Additional Shares. (a)
Except pursuant to the First Priority Notes Indenture or the First Priority
Notes Security Agreement, each Grantor agrees that it will not (i) sell, assign
or otherwise dispose of, or grant any option with respect to, any of the
Collateral, other than sales, assignments and other dispositions of Collateral,
and options relating to Collateral, permitted under the terms of the Second
Priority Notes indenture, or (ii) create or suffer to exist any Lien upon or
with respect to any of the Collateral of such Grantor except for the pledge,
assignment and second priority security interest created under this Agreement.
(b) Each Grantor agrees that it will take any action within
its power to (i) cause each issuer of the Pledged Equity pledged by such Grantor
not to issue any equity interests or other securities in substitution for the
Pledged Equity issued by such issuer, except to such Grantor, and (ii) pledge
hereunder, immediately upon its acquisition (directly or indirectly) thereof,
any and all additional equity interests or other securities representing Pledged
Equity.
Section 14. Second Priority Notes Collateral Agent Appointed
Attorney-in-Fact. Each Grantor hereby irrevocably appoints the Second Priority
Notes Collateral Agent such Grantor's attorney-in-fact, with full authority in
the place and stead of such Grantor and in the name of such Grantor or
otherwise, from time to time, in the Second Priority Notes Collateral Agent's
discretion after the occurrence of an Event of Default which is continuing and
after the occurrence of a Collateral Transfer, to take any action and to execute
any instrument that may be necessary or advisable to accomplish the purposes of
this Agreement, including, without limitation:
(a) to ask for, demand, collect, ▇▇▇ for, recover, compromise,
receive and give acquittance and receipts for moneys due and to become
due under or in respect of any of the Transferred Collateral,
16
(b) to receive, indorse and collect any drafts or other
instruments, documents and chattel paper, in connection with clause (a)
above, and
(c) to file any claims or take any action or institute any
proceedings that maybe necessary or desirable for the collection of any
of the Transferred Collateral or otherwise to enforce compliance with
the terms and conditions of the Support Agreement or the rights of the
Second Priority Notes Collateral Agent with respect to any of the
Transferred Collateral.
Section 15. Second Priority Notes Collateral Agent May
Perform. If any Grantor fails to perform any agreement contained herein, the
Second Priority Notes Collateral Agent may, as is necessary to protect the
second priority security interest granted hereunder in the Collateral or to
protect the value thereof, but without any obligation to do so and without
notice, itself perform, or cause performance of, such agreement, and the
expenses of the Second Priority Notes Collateral Agent incurred in connection
therewith shall be payable by such Grantor under Section 18; provided that the
Second Priority Notes Collateral Agent shall not take any action that would
cause the Company to violate any provision of the First Priority Notes Security
Agreement, the First Priority Notes Indenture or the First Priority Notes
Intercreditor Agreement.
Section 16. The Second Priority Notes Collateral Agent's
Duties. (a) The powers conferred on the Second Priority Notes Collateral Agent
hereunder are solely to protect the Second Priority Secured Parties' interest in
the Collateral and shall not impose any duty upon it to exercise any such
powers. Except for the safe custody of any Transferred Collateral in its
possession and the accounting for moneys actually received by it hereunder, the
Second Priority Notes Collateral Agent shall have no duty as to any Collateral,
as to ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Collateral,
whether or not any Second Priority Secured Party has or is deemed to have
knowledge of such matters, or as to the taking of any necessary steps to
preserve rights against any parties or any other rights pertaining to any
Collateral. The Second Priority Notes Collateral Agent shall be deemed to have
exercised reasonable care in the custody and preservation of any Transferred
Collateral in its possession if such Transferred Collateral is accorded
treatment substantially equal to that which it accords its own property.
(b) Anything contained herein to the contrary notwithstanding,
the Second Priority Notes Collateral Agent may from time to time, when the
Second Priority Notes Collateral Agent deems it to be necessary, appoint one or
more agents (each a "SUBAGENT") for the Second Priority Notes Collateral Agent
hereunder with respect to all or any part of the Collateral. In the event that
the Second Priority Notes Collateral Agent so appoints any Subagent with respect
to any Collateral, (i) the assignment and pledge of such Collateral and the
second priority security interest granted in such Collateral by each Grantor
hereunder shall be deemed for purposes of this Second Priority Notes Security
Agreement to have been made to such Subagent, in addition to the Second Priority
Notes Collateral Agent, for the ratable benefit of the Second Priority Notes
Collateral Agent and the other Second Priority Secured Parties, as security for
the Secured Obligations of such Grantor, (ii) such Subagent shall automatically
17
be vested, in addition to the Second Priority Notes Collateral Agent, with all
rights, powers, privileges, interests and remedies of the Second Priority Notes
Collateral Agent hereunder with respect to such Collateral, and (iii) the term
"Second Priority Notes Collateral Agent," when used herein in relation to any
rights, powers, privileges, interests and remedies of the Second Priority Notes
Collateral Agent with respect to such Collateral, shall include such Subagent;
provided, however, that no such Subagent shall be authorized to take any action
with respect to any such Collateral unless and except to the extent expressly
authorized in writing by the Second Priority Notes Collateral Agent.
Section 17. Remedies. If any Event of Default shall have
occurred and be continuing:
(a) The Second Priority Notes Collateral Agent may exercise in
respect of the Transferred Collateral, in addition to other rights and
remedies provided for herein or otherwise available to it, all the
rights and remedies of a secured party upon default under the UCC,
PPSA(ON) or PPSA(NB), as applicable (whether or not the UCC, PPSA(ON)
or PPSA(NB), as applicable, apply to the affected Transferred
Collateral), and also may: (i) require each Grantor to, and each
Grantor hereby agrees that it will at its expense and upon request of
the Second Priority Notes Collateral Agent forthwith, assemble all or
part of the Transferred Collateral as directed by the Second Priority
Notes Collateral Agent (to the extent such Transferred Collateral was
not delivered to the Second Priority Notes Collateral Agent by the
First Priority Notes Collateral Agent in connection with a Collateral
Transfer) and make it available to the Second Priority Notes Collateral
Agent at a place and time to be designated by the Second Priority Notes
Collateral Agent that is reasonably convenient to both parties; (ii)
without notice except as specified below, sell the Transferred
Collateral or any part thereof in one or more parcels at public or
private sale, at any of the Second Priority Notes Collateral Agent's
offices or elsewhere, for cash, on credit or for future delivery, and
upon such other terms as the Second Priority Notes Collateral Agent may
deem commercially reasonable; (iii) occupy any premises owned or leased
by any of the Grantors where the Transferred Collateral or any part
thereof is assembled or located for a reasonable period in order to
effectuate its rights and remedies hereunder or under law, without
obligation to such Grantor in respect of such occupation; and (iv)
exercise any and all rights and remedies of any of the Grantors under
or in connection with the Transferred Collateral, or otherwise in
respect of the Transferred Collateral, including, without limitation,
(A) any and all rights of such Grantor to demand or otherwise require
payment of any amount under, or performance of any provision of, the
Support Agreement, the Receivables and the other Collateral, (B)
withdraw, or cause or direct the withdrawal, of all funds with respect
to the Account Collateral and (C) exercise all other rights and
remedies with respect to the Support Agreement, the Receivables and the
other Collateral, including, without limitation, those set forth in
Section 9-607 of the UCC and those set forth in the PPSA(ON) and
18
PPSA(NB). Each Grantor agrees that, to the extent notice of sale shall
be required by law, at least ten days' notice to such Grantor of the
time and place of any public sale or the time after which any private
sale is to be made shall constitute reasonable notification. The Second
Priority Notes Collateral Agent shall not be obligated to make any sale
of Transferred Collateral regardless of notice of sale having been
given. The Second Priority Notes Collateral Agent may adjourn any
public or private sale from time to time by announcement at the time
and place fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was so adjourned. No person
dealing with the Second Priority Notes Collateral Agent or its servants
or agents shall be concerned to inquire whether the security hereby
constituted has become enforceable, whether the powers which the Second
Priority Notes Collateral Agent is purporting to exercise have become
exercisable, whether any money remains due on the security of the
Collateral, as to the necessity or expedience of the stipulations and
conditions subject to which any sale, lease or disposition shall be
made, otherwise as to the propriety or regularity of any sate or any
other dealing by the Second Priority Notes Collateral Agent with the
Collateral or to see to the application of any money paid to the Second
Priority Notes Collateral Agent. In the absence of fraud on the part of
such persons, such dealings shall be deemed, so far as regards the
safety and protection of such person, to be within the powers hereby
conferred and to be valid and effective accordingly.
(b) All cash proceeds received by or on behalf of the Second
Priority Notes Collateral Agent in respect of any sale of, collection
from, or other realization upon all or any part of the Transferred
Collateral may be held by the Second Priority Notes Collateral Agent as
collateral for, and/or then or at any time thereafter applied (after
payment of any amounts payable to the Second Priority Notes Collateral
Agent pursuant to Section 18) in whole or in part by the Second
Priority Notes Collateral Agent for the ratable benefit of the Second
Priority Secured Parties against, all or any part of the Secured
Obligations, in the following manner:
(i) first, paid to the Second Priority Notes
Collateral Agent for any amounts then owing to the Second
Priority Notes Collateral Agent under the Second Priority Note
Documents; and
(ii) second, ratably paid to the Holders and any
other Second Priority Secured Parties, for any amounts then
owing to them, in their capacities as such, under the Second
Priority Note Documents ratably in accordance with such
respective amounts then owing to such Second Priority Secured
Parties.
Any surplus of such cash or cash proceeds held by or on the behalf of
the Second Priority Notes Collateral Agent and remaining after payment
in full of all the Secured Obligations shall be paid over to the
applicable Grantor or to whomsoever may be lawfully entitled to receive
such surplus.
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(c) From and after any Collateral Transfer, all payments
received by any Grantor under or in connection with the Support
Agreement or otherwise in respect of the Transferred Collateral shall
be received in trust for the benefit of the Second Priority Notes
Collateral Agent, shall be segregated from other funds of such Grantor
and shall be forthwith paid over to the Second Priority Notes
Collateral Agent in the same form as so received (with any necessary
indorsement).
(d) From and after any Collateral Transfer, the Second
Priority Notes Collateral Agent may, without notice to any Grantor
except as required by law and at any time or from time to time, charge,
set-off and otherwise apply all or any part of the Secured Obligations
against any funds held with respect to the Account Collateral included
in the Transferred Collateral or in any other deposit account.
(e) From and after a Collateral Transfer, if the Second
Priority Notes Collateral Agent shall determine to exercise its right
to sell all or any of the Security Collateral included in the
Transferred Collateral of any Grantor pursuant to this Section 17, each
Grantor agrees that, upon request of the Second Priority Notes
Collateral Agent, such Grantor will, at its own expense, to the extent
the Company then has the present ability to complete and have declared
effect a registration statement under the United States securities
laws:
(i) execute and deliver, and cause each issuer of
such Security Collateral contemplated to be sold and the
directors and officers thereof to execute and deliver, all
such instruments and documents, and do or cause to be done all
such other acts and things, as may be necessary or advisable
to register for resale such Security Collateral under the
provisions of the Securities Act of 1933 (as amended from time
to time, the "SECURITIES ACT"), to cause the registration
statement relating thereto (the "COLLATERAL SHELF REGISTRATION
STATEMENT") to become effective and to remain effective for
such period as prospectuses are required by law to be
furnished and in any event for so long as is necessary to
enable the Holders to dispose of the Security Collateral in
the manner of sale provided for in the registration statement
and to make all amendments and supplements thereto and to the
related prospectus that are necessary or advisable, all in
conformity with the requirements of the Securities Act and the
rules and regulations of the Securities and Exchange
Commission applicable thereto;
(ii) use its best efforts to qualify the Security
Collateral under the state securities or "Blue Sky" laws and
to obtain all necessary governmental approvals for the sale of
such Security Collateral, as requested by the Second Priority
Notes Collateral Agent or any other Second Priority Secured
Party;
20
(iii) cause each such issuer of such Security
Collateral to make available to its security holders, as soon
as practicable, an earnings statement that will satisfy the
provisions of Section 11(a) of the Securities Act;
(iv) provide the Second Priority Notes Collateral
Agent and each other Second Priority Secured Party with such
other information and projections as may be necessary or
advisable to enable the Second Priority Second Priority Notes
Collateral Agent or any other Second Priority Secured Party to
effect the sale of such Security Collateral;
(v) take such other actions in furtherance of the
resale of the Security Collateral pursuant to the Collateral
Shelf Registration Statement as are comparable to those
described in Section 5 (Registration Procedures) of the
Registration Rights Agreement with respect to the Shelf
Registration Statement (as defined therein) mutatis mutandis;
and
(vi) do or cause to be done all such other acts and
things as may be necessary to make such sale of such Security
Collateral or any part thereof valid and binding and in
compliance with applicable law.
(f) The Second Priority Notes Collateral Agent is authorized,
in connection with any sale of the Security Collateral pursuant to this
Section 17, to deliver or otherwise disclose to any prospective
purchaser of the Security Collateral: (i) any registration statement or
prospectus, and all supplements and amendments thereto, prepared
pursuant to subsection (e)(i) above; (ii) any information and
projections provided to it pursuant to subsection (e)(iv) above; and
(iii) any other information in its possession relating to such Security
Collateral.
(g) Each Grantor acknowledges the impossibility of
ascertaining the amount of damages that would be suffered by the Second
Priority Secured Parties by reason of the failure by such Grantor to
perform any of the covenants contained in subsection (e) above and,
consequently, agrees that, if such Grantor shall fail to perform any of
such covenants, it will pay, as liquidated damages and not as a
penalty, an amount equal to the value of the Security Collateral on the
date the Second Priority Collateral Agent shall demand compliance with
subsection (e) above.
(h) The Second Priority Notes Collateral Agent may, in
addition to any other rights it may have, appoint by instrument in
writing a receiver or receiver and manager (both of which are herein
called a "RECEIVER") of all or any part of any Transferred Collateral
or may institute proceedings in any court of competent jurisdiction for
the appointment of such a Receiver. Any such Receiver is hereby given,
and shall have the same powers and rights and exclusions and
limitations of liability as the Second Priority Notes Collateral Agent
21
has under this Agreement, at law or in equity. In exercising any such
powers, any such Receiver shall, to the extent permitted by law, act as
and for all purposes shall be deemed to be the agent of the Grantor and
the Second Priority Notes Collateral Agent shall not be responsible for
any act or default of any such Receiver. The Second Priority Notes
Collateral Agent may appoint one or more Receivers hereunder and may
remove any such Receiver or Receivers and appoint another or others in
his or their stead from time to time. Any Receiver so appointed may be
an officer or employee of the Second Priority Notes Collateral Agent. A
court need not appoint, ratify the appointment by the Second Priority
Notes Collateral Agent of or otherwise supervise in any manner the
actions of any Receiver. Upon a Grantor receiving notice from the
Second Priority Notes Collateral Agent of the taking of possession of
any Transferred Collateral or the appointment of a Receiver, all
powers, functions, rights and privileges of each of the directors and
officers of such Grantor with respect to any Transferred Collateral
shall cease, unless specifically continued by the written consent of
the Second Priority Notes Collateral Agent.
Section 18. Indemnity and Expenses. (a) Each Grantor agrees to
indemnify, defend and save and hold harmless each Second Priority Secured Party
and each of their Affiliates and their respective officers, directors,
employees, agents and advisors (each, an "INDEMNIFIED PARTY") from and against,
and shall pay on demand, any and all claims, damages, losses, liabilities and
expenses (including, without limitation, reasonable fees and expenses of
counsel) that may be incurred by or asserted or awarded against any Indemnified
Party, in each case arising out of or in connection with or resulting from this
Agreement (including, without limitation, enforcement of this Agreement), except
to the extent such claim, damage, loss, liability or expense is found in a final
judgment by a court of competent jurisdiction to have resulted from such
Indemnified Party's gross negligence or willful misconduct.
(b) Each Grantor will upon demand pay to the Second Priority
Notes Collateral Agent the amount of any and all reasonable fees and expenses,
including, without limitation, the reasonable fees and expenses of its counsel
and of any experts and agents, that the Second Priority Notes Collateral Agent
may incur in connection with (i) the administration of this Agreement, (ii) the
custody, preservation, use or operation of, or the sale of, collection from or
other realization upon, any Transferred Collateral, (iii) the exercise or
enforcement of any of the rights of the Second Priority Notes Collateral Agent
or the other Second Priority Secured Parties hereunder or (iv) the failure by
such Grantor to perform or observe any of the provisions hereof.
(c) In each case that the Second Priority Notes Collateral
Agent may or is required hereunder to take any action, including without
limitation to make any determination or judgment, to give consents, to exercise
rights, powers or remedies or otherwise to act hereunder, the Second Priority
Notes Collateral Agent may seek instruction from the Holders with respect to any
such action of the Second Priority Notes Collateral Agent on which Holders are
entitled to give instruction under the Second Priority Notes Indenture. The
Second Priority Notes Collateral Agent shall not be liable with respect to any
22
action taken or omitted to be taken by it in good faith in accordance with such
instruction from the Holders.
Section 19. Amendments; Waivers; Additional Grantors; Etc. (a)
No amendment or waiver of any provision of this Agreement, and no consent to any
departure by any Grantor herefrom, shall in any event be effective unless the
same shall be in writing and signed by the Second Priority Notes Collateral
Agent, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given. No failure on the part of
the Second Priority Notes Collateral Agent or any other Second Priority Secured
Party to exercise, and no delay in exercising any right hereunder, shall operate
as a waiver thereof, nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right.
(b) Upon the execution and delivery, or authentication, by any
Person of a second priority notes security agreement supplement in substantially
the form of Exhibit A hereto (each a "SECOND PRIORITY NOTES SECURITY AGREEMENT
SUPPLEMENT"), such Person shall be referred to as an "ADDITIONAL GRANTOR" and
shall be and become a Grantor hereunder, and each reference in this Agreement
and the other Second Priority Note Documents to "Grantor" shall also mean and be
a reference to such Additional Grantor, and each reference in this Agreement and
the other Second Priority Note Documents to "Collateral" and "Transferred
Collateral" shall also mean and be a reference to the Collateral and/or
Transferred Collateral of such Additional Grantor, and the supplemental
Schedules I-III attached to each Second Priority Notes Security Agreement
Supplement shall be incorporated into and become a part of and supplement
Schedules I-III, respectively, hereto, and the Second Priority Notes Collateral
Agent may attach such supplemental schedules to such Schedules; and each
reference to such Schedules shall mean and be a reference to such Schedules as
supplemented pursuant to each Second Priority Notes Security Agreement
Supplement.
Section 20. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including facsimile communication)
and mailed or faxed in the case of the Second Priority Notes Collateral Agent,
addressed to it at the Corporate Trust Office specified in the Second Priority
Notes Indenture and, in the case of each Grantor, addressed to it at its address
set forth opposite such Grantor's name on the signature pages hereto or on the
signature page to the Second Priority Notes Security Agreement Supplement
pursuant to which it became a party hereto; or, as to any party, at such other
address as shall be designated by such party in a written notice to the other
parties. All such notices and other communications shall, when mailed or faxed,
be effective when deposited in the mails, faxed or otherwise delivered (or
confirmed by a signed receipt), respectively, addressed as aforesaid; except
that notices and other communications to the Second Priority Notes Collateral
Agent shall not be effective until received by the Second Priority Notes
Collateral Agent. Delivery by facsimile of an executed counterpart of any
amendment or waiver of any provision of this Agreement or of any Second Priority
Notes Security Agreement Supplement or Schedule hereto shall be effective as
delivery of an original executed counterpart thereof.
23
Section 21. Continuing Security Interest. This Agreement shall
create a continuing second priority security interest in the Collateral and
shall (a) remain in full force and effect until the payment in full in cash of
the Secured Obligations, (b) be binding upon each Grantor, its successors and
assigns and (c) inure, together with the rights and remedies of the Second
Priority Notes Collateral Agent hereunder, to the benefit of the Second Priority
Secured Parties and their respective successors, transferees and assigns.
Section 22. Release of Collateral; Termination. (a) From and
after any Collateral Transfer, so long as no Default or Event of Default shall
have occurred and be continuing, the Second Priority Notes Collateral Agent will
release to the Company or at its order (or, at the request of the Company, to
the Second Priority Notes Collateral Agent to be applied to the Secured
Obligations of the Company under the Second Priority Note Documents), the
Transferred Collateral to the extent permitted to be released under the terms of
the Second Priority Note Documents and will, at such Grantor's expense, execute
and deliver to such Grantor such documents as such Grantor shall reasonably
request to evidence the release of any Collateral from the second priority
security interest granted hereby to the extent permitted to be released under
the terms of the Second Priority Note Documents; provided, however, that (i) at
the time of such request and such release no Default shall have occurred and be
continuing, (ii) all conditions required to be satisfied under the Second
Priority Notes Indenture shall have been complied with, and (iii) the Grantor
shall have delivered to the Second Priority Notes Collateral Agent a form of
release for execution by the Second Priority Notes Collateral Agent and a
certificate of such Grantor to the effect that the transaction is in compliance
with the Second Priority Note Documents and as to such other matters as the
Second Priority Notes Collateral Agent may request.
(b) Upon the payment in full in cash of the Secured
Obligations, the pledge and second priority security interest granted hereby
shall terminate and all rights to the Collateral shall revert to the applicable
Grantor, except as otherwise provided in the First Priority Notes Indenture or
the First Priority Notes Security Agreement. Upon any such termination, the
Second Priority Notes Collateral Agent will, at the applicable Grantor's
expense, execute and deliver to such Grantor such documents as such Grantor
shall reasonably request to evidence such termination.
Section 23. Security Interest Absolute. The obligations of
each Grantor under this Agreement are independent of the Secured Obligations or
any other obligations of any Grantor, or any Affiliate of any Grantor under or
in respect of the Second Priority Note Documents, and a separate action or
actions may be brought and prosecuted against each Grantor to enforce this
Agreement, irrespective of whether any action is brought against such Grantor or
any other Affiliate of any Grantor or whether such Grantor or any other
Affiliate of any Grantor is joined in any such action or actions. All rights of
the Second Priority Notes Collateral Agent and the other Second Priority Secured
Parties and the pledge, assignment and second priority security interest
hereunder, and all obligations of each Grantor hereunder, shall be irrevocable,
absolute and unconditional irrespective of, and each Grantor hereby irrevocably
waives (to the maximum extent permitted by applicable law) any defenses it may
24
now have or may hereafter acquire in any way relating to, any or all of the
following:
(a) any lack of validity or enforceability of any Second
Priority Note Document or any other agreement or instrument relating
thereto;
(b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Secured Obligations or any
other obligations of any other Affiliate of a Grantor under or in
respect of the Second Priority Note Documents or any other amendment or
waiver of or any consent to any departure from any Note Document,
including, without limitation, any increase in the Secured Obligations
to any Grantor or any of its Affiliates or otherwise;
(c) any taking, exchange, release or non-perfection of any
Transferred Collateral or any other collateral, or any taking, release
or amendment or waiver of or consent to departure from any guaranty,
for all or any of the Secured Obligations;
(d) any manner of application of any Transferred Collateral or
any other collateral, or proceeds thereof, to all or, any of the
Secured Obligations, or any mariner of sale or other disposition of any
Transferred Collateral or any other collateral for all or any of the
Secured Obligations or any other obligations of any other Affiliate of
any Grantor under or in respect of the Note Documents or any other
assets of any Affiliate of any Grantor;
(e) any change, restructuring or termination of the corporate
structure or existence of any Grantor, or any Affiliate of any Grantor;
(f) any failure of any Second Priority Secured Party to
disclose to any Grantor or any Affiliate of any Grantor any information
relating to the business, condition (financial or otherwise),
operations, performance, assets, nature of assets, liabilities or
prospects of any other Grantor or Affiliate of any Grantor now or
hereafter known to such Second Priority Secured Party (each Grantor
waiving any duty on the part of the Second Priority Secured Parties to
disclose such information);
(g) the failure of any other Person to execute this Agreement
or any other Second Priority Note Document, guaranty or agreement or
the release or reduction of liability of any Grantor or other grantor
or surety with respect to the Secured Obligations; or
(h) any other circumstance (including, without limitation, any
statute of limitations) or any existence of or reliance on any
representation by any Second Priority Secured Party that might
otherwise constitute a defense available to, or a discharge of, such
Grantor or any other Grantor or a third party grantor of a security
interest.
25
This Agreement shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Secured Obligations is rescinded or
must otherwise be returned by any Second Priority Secured Party or by any other
Person upon the insolvency, bankruptcy or reorganization of any Grantor or any
Affiliate of any Grantor or otherwise, all as though such payment had not been
made.
Section 24. Execution in Counterparts. This Agreement may be
executed in any number of counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement. Delivery of an executed counterpart of a signature page
to this Agreement by facsimile shall be effective as delivery of an original
executed counterpart of this Agreement.
Section 25. Governing Law; Jurisdiction; Waiver of Jury Trial,
Etc. (a) This Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York.
(b) Each Grantor hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of any
New York State court or federal court of the United States of America sitting in
New York City, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement or any of the other
Second Priority Note Documents to which it is or is to be a party, or for
recognition or enforcement of any judgment, and each Grantor hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such New York State court or, to
the extent permitted by taw, in such federal court. Each Grantor agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Second Priority Note
Document shall affect any right that any party may otherwise have to bring any
action or proceeding relating to this Agreement or any other Second Priority
Note Document in the courts of any jurisdiction.
(c) Each Grantor irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any of the other
Second Priority Note Documents to which it is or is to be a party in any New
York State or federal court. Each Grantor hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such suit, action or proceeding in any such court.
(d) Each Grantor represents, warrants and agrees that, within
30 days after the date hereof, it will have appointed Corporation Service
Company as its authorized agent (the "AUTHORIZED AGENT," which terra, as used
herein, includes any successor in such capacity) upon whom process may be served
in any such action, suit or proceeding arising out of, based on or relating to
this Agreement or any of the transactions contemplated hereby. Such appointment
shall, to the fullest extent it may effectively do so under applicable law, be
26
irrevocable. Each Grantor represents, warrants and agrees that, prior to the
Closing Date, the Authorized Agent will have agreed to act as such agent for
service of process and such Grantor agrees, to the fullest extent it may
effectively do so under applicable law, to take any and all action, including
the filing of any and all documents and instruments and the payment of all fees,
that may be necessary to effect and to continue such appointment in full force
and effect as aforesaid for so long as any of the Secured Obligations shall be
outstanding and until the principal of, premium, if any and interest on, and any
and all other amounts payable under or with respect to the Secured Obligations
shall have been, paid in full. Each Grantor agrees, to the fullest extent it may
effectively do so under applicable law, that service of process upon the
Authorized Agent and written notice for such service to such Grantor (mailed or
delivered to its Secretary at the Address shown next to its name on the
signature page of this Agreement) shall be deemed, in every respect, effective
service of process upon such Grantor in any such action, suit or proceeding.
(e) In respect of any judgment or order given or made against
a Grantor for any amount due hereunder that is expressed and paid in a currency
(the "JUDGMENT CURRENCY") other than United States dollars, such Grantor will
indemnify the Second Priority Notes Collateral Agent and each other Second
Priority Secured Party, from and against any and all loss incurred by such
Secured Party as a result of any variation as between (i) the rate of exchange
at which the United States dollar amount is converted into the judgment currency
for the purpose of such judgment or order and (ii) the rate of exchange at which
such Secured Party is able to purchase United States dollars with the amount of
judgment currency actually received by such Secured Party. Each Grantor agrees,
to the fullest extent it may effectively do so under applicable law, that the
foregoing indemnity shall constitute a separate and independent obligation of
such Grantor and shall continue in full force and effect notwithstanding any
such judgment or order as aforesaid. The term "rate of exchange" shall include
any premiums and costs of exchange payable in connection with the purchase of or
conversion into United States dollars.
(f) To the extent that a Grantor or any of its properties,
assets or revenues may have or may hereafter become entitled to, or have
attributed to it, any right of immunity, on the grounds of sovereignty or
otherwise, from (i) any legal action, suit or proceeding, (ii) setoff or
counterclaim, (iii) the jurisdiction of any court, (iv) service process, (v)
attachment upon or prior to judgment, (vi) attachment in aid of execution of
judgment, (vii) execution of judgment, or (viii) other legal process or
proceeding for the giving of any relief or for the enforcement of any judgment,
in any jurisdiction in which any action, suit or proceeding may at any time be
commenced with respect to its obligations, liabilities or any other matter under
or arising out of or in connection with this Agreement, such Grantor, to the
fullest extent it may effectively do so under applicable law, hereby irrevocably
and unconditionally waives, and agrees not to plead or claim, any such immunity
and consents to such relief and enforcement.
(g) EACH GRANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT,
27
TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE SECOND PRIORITY NOTE
DOCUMENTS, THE ADVANCES OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
28
IN WITNESS WHEREOF, each Grantor has caused this Agreement to
be duty executed and delivered by its officer thereunto duly authorized as of
the date first above written.
Address for Notices: ▇▇▇▇▇▇▇▇▇ INC.
-------------------
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ -----------------------------
Attention: Chief Financial Officer Title: Co-COO
Address for Notices: RAVELSTON MANAGEMENT INC.
-------------------
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ -----------------------------
Attention: Chief Financial Officer Title: Executive VP
Address for Notices: 504468 N.B. INC.
-------------------
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ -----------------------------
Attention: Chief Financial Officer Title: Executive VP
29
SCHEDULE I TO THE
SECOND PRIORITY NOTES SECURITY AGREEMENT
LOCATION, CHIEF EXECUTIVE OFFICE, PLACE WHERE AGREEMENTS
ARE MAINTAINED, TYPE OF ORGANIZATION, JURISDICTION OF
ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION NUMBER
LOCATION, CHIEF EXECUTIVE JURISDICTION
OFFICE, AND PLACE WHERE TYPE OF OF ORGANIZATIONAL
GRANTOR AGREEMENTS ARE MAINTAINED ORGANIZATION ORGANIZATION I.D. NO.
------- ------------------------- ------------ ------------ --------
▇▇▇▇▇▇▇▇▇ Inc. ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇-▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ Corporation
Ravelston ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 1517107
Management Inc. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ Corporation
504468 N.B. Inc. ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ New Brunswick, 504468
Toronto, Canada ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
(Registered office
and agent at the following
address:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Stirling
Scales
10th Floor, Brunswick House
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Correspondence:
P.O. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇)
SCHEDULE II TO THE
SECOND PRIORITY NOTES SECURITY AGREEMENT
PLEDGED EQUITY
---------------------------- --------------- ---------- ----------------- ----------------- -----------------
PERCENTAGE
CLASS OF OF CLASS OF
EQUITY CERTIFICATE NUMBER OUTSTANDING
ISSUER INTEREST PAR VALUE NO(S) OF SHARES SHARES
---------------------------- --------------- ---------- ----------------- ----------------- -----------------
▇▇▇▇▇▇▇▇▇ International Class B $0.01 B0005 12,990,000 86.66%
Inc. Common Stock
---------------------------- --------------- ---------- ----------------- ----------------- -----------------
▇▇▇▇▇▇▇▇▇ International Class B $0.01 B0006 2,000,000 13.34%
Inc. Common Stock
---------------------------- --------------- ---------- ----------------- ----------------- -----------------
SCHEDULE III TO THE
SECOND PRIORITY NOTES SECURITY AGREEMENT
ASSIGNED AGREEMENTS
GRANTOR ASSIGNED AGREEMENT
------- ------------------
RMI Services Agreement between ▇▇▇▇▇▇▇▇▇ International Inc. and
The Ravelston Corporation Limited, dated as of January 1, 1998
as assigned by The Ravelston Corporation, Limited to Ravelston
Management Inc. pursuant to a Transfer and Consent Agreement
dated July 5, 2002 (as amended, amended and restated, or
otherwise modified or supplemented from time to time).
(Agreement has been terminated).
RMI Amended and Restated Services Agreement between ▇▇▇▇▇▇▇▇▇
Canadian Publishing Holdings Co. and The Ravelston Corporation
Limited, dated as of December 1, 1999 as assigned by The
Ravelston Corporation Limited to Ravelston Management Inc.
pursuant to a Transfer and Consent Agreement dated July 5,
2002 (as amended, amended and restated, or otherwise modified
or supplemented from time to time). (Agreement has been
terminated).
HI Support Agreement between ▇▇▇▇▇▇▇▇▇ Inc. and Ravelston
Management Inc. dated as of March 10, 2003 (as amended,
amended and restated, or otherwise modified or supplemented
from time to time).
SCHEDULE IV TO THE
SECOND PRIORITY NOTES SECURITY AGREEMENT
CHANGES IN NAME, LOCATION, ETC.
None.
EXHIBIT A TO THE
SECOND PRIORITY NOTES SECURITY AGREEMENT
FORM OF SECOND PRIORITY NOTES SECURITY AGREEMENT
SUPPLEMENT
[Date]
HSBC Bank USA, National Association,
as Trustee and Collateral Agent
under the Indenture referred to below
Attn: Corporate Trust
▇▇▇▇▇▇▇▇▇ Inc.
Ladies and Gentlemen:
Reference is made to (i) the Indenture dated as of September
30, 2004 (as amended, amended and restated, supplemented or otherwise modified
from time to time, the "SECOND PRIORITY NOTES INDENTURE"), among ▇▇▇▇▇▇▇▇▇ Inc.,
(the "COMPANY"), as the issuer of Second Priority Notes thereunder, Ravelston
Management Inc. ("RMI"), 504468 N.B. Inc. ("NBI"), The Ravelston Corporation
Limited, Sugra Limited, and HSBC Bank USA, National Association, as trustee and
collateral agent (together with any successor appointed pursuant to the Second
Priority Notes Indenture, the "SECOND PRIORITY NOTES COLLATERAL AGENT"), and
(ii) the Second Priority Notes Security Agreement dated as of September 30, 2004
(as amended, amended and restated, supplemented or otherwise modified from time
to time, the "SECOND PRIORITY NOTES SECURITY AGREEMENT") made by the Grantors
from time to time party thereto in favor of the Second Priority Notes Collateral
Agent for the Second Priority Secured Parties (as defined therein). Terms
defined in the Second Priority Notes Indenture or the Second Priority Notes
Security Agreement and not otherwise defined herein are used herein as defined
in the Second Priority Notes Indenture or the Second Priority Notes Security
Agreement.
SECTION 1. Grant of Security. The undersigned hereby grants,
assigns and transfers to the Second Priority Notes Collateral Agent, for the
ratable benefit of the Second Priority Secured Parties, a second priority
security interest in, all of its right, title and interest in and to all of the
Collateral of the undersigned, whether now owned or hereafter acquired by the
undersigned, wherever located and whether now or hereafter existing or arising,
including, without limitation, the property and assets of the undersigned set
forth on the attached supplemental schedules to the Schedules to the Second
Priority Notes Security Agreement.
SECTION 2. Security for Obligations. The grant of a second
priority security interest in, the Collateral by the undersigned under this
Agreement Supplement and the Second Priority Notes Security Agreement secures
the payment of all obligations of the undersigned now or hereafter existing
under or in respect of the Second Priority Note Documents, whether direct or
indirect, absolute or contingent, and whether for principal, reimbursement
obligations, interest, premiums, penalties, fees, indemnifications, contract
causes of action, costs, expenses or otherwise. Without limiting the generality
of the foregoing, this Second Priority Notes Security Agreement Supplement and
the Second Priority Notes Security Agreement secures the payment of all amounts
that constitute part of the Secured Obligations and that would be owed by the
undersigned, whether incurred alone or with another or others and whether as
principal, guarantor or surety, to any Secured Party under the Second Priority
Note Documents but for the fact that such Secured Obligations are unenforceable
or not allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving a Grantor or any Affiliate of a Grantor.
SECTION 3. Supplements to Second Priority Notes Security
Agreement Schedules. The undersigned has attached hereto supplemental Schedules
I through III to Schedules I through III, respectively, to the Second Priority
Notes Security Agreement, and the undersigned hereby certifies, as of the date
first above written, that such supplemental schedules have been prepared by the
undersigned in substantially the form of the equivalent Schedules to the Second
Priority Notes Security Agreement and are complete and correct.
SECTION 4. Representations and Warranties. The undersigned
hereby makes each representation and warranty set forth in Section 8 of the
Second Priority Notes Security Agreement (as supplemented by the attached
supplemental schedules) to the same extent as each other Grantor.
SECTION 5. Obligations Under the Second Priority Notes
Security Agreement. The undersigned hereby agrees, as of the date first above
written, to be bound as a Grantor by all of the terms and provisions of the
Second Priority Notes Security Agreement to the same extent as each of the other
Grantors. The undersigned further agrees, as of the date first above written,
that each reference in the Second Priority Notes Security Agreement to an
"Additional Grantor" or a "Grantor" shall also mean and be a reference to the
undersigned.
SECTION 6. Governing Law; Jurisdiction; Waiver of Jury Trial,
Etc. This Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York.
(a) The undersigned hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of any
New York State court or federal court of the United States of America sitting in
New York City, and any appellate court from any thereof; in any action or
proceeding arising out of or relating to this Agreement or any of the other
Second Priority Note Documents to which it is or is to be a party, or for
recognition or enforcement of any judgment, and the undersigned hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such federal court. The undersigned
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement or any other
Second Priority Note Document shall affect any right that any party may
otherwise have to bring any action or proceeding relating to this Agreement or
any other Second Priority Note Document in the courts of airy jurisdiction.
(b) The undersigned irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any of the other
Second Priority Note Documents to which it is or is to be a party in any New
York State or federal court. The undersigned hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such suit, action or proceeding in any such court.
(c) The undersigned represents, warrants and agrees that,
prior to the Closing Date, it will have appointed Corporation Service Company as
its authorized agent (the "AUTHORIZED Agent", which term, as used herein,
includes any successor in such capacity) upon whom process may be served in any
such action, suit or proceeding arising out of, based on or relating to this
Agreement or any of the transactions contemplated hereby. Such appointment
shall, to the fullest extent it may effectively do so under applicable law, be
irrevocable. The undersigned represents, warrants and agrees that, prior to the
Closing Date, the Authorized Agent will have agreed to act as such agent for
service of process and the undersigned agrees, to the fullest extent it may
effectively do so under applicable law, to take any and all action, including
the filing of any and all documents and instruments and the payment of all fees,
that may be necessary to effect and to continue such appointment in full force
and effect as aforesaid for so long as any of the Secured Obligations shall be
outstanding and until the principal of, premium, if any and interest on, and any
and all other amounts payable under or with respect to the Secured Obligations
shall have been paid in full. The undersigned agrees, to the fullest extent it
may effectively do so under applicable law, that service of process upon the
Authorized Agent and written notice for such service to the undersigned (mailed
or delivered to its Secretary at the address shown next to its name on the
signature page of this Agreement) shall be deemed, in every respect, effective
service of process upon the undersigned in any such action, suit or proceeding.
(d) In respect of any judgment or order given or made against
the undersigned for any amount due hereunder that is expressed and paid in a
currency (the "JUDGMENT CURRENCY") other than United States dollars, the
undersigned will indemnify the Second Priority Notes Collateral Agent and each
other Secured Party, from and against any and all loss incurred by such Secured
Party as a result of any variation as between (i) the rate of exchange at which
the United States dollar amount is converted into the judgment currency for the
purpose of such judgment or order and (ii) the rate of exchange at which such
Second Priority Secured Party is able to purchase United States dollars with the
amount of judgment currency actually received by such Secured Party. The
undersigned agrees, to the fullest extent it may effectively do so under
applicable law, that the foregoing indemnity shall constitute a separate and
independent obligation of the undersigned and shall continue in full force and
effect notwithstanding any such judgment or order as aforesaid. The term "rate
of exchange" shall include any premiums and costs of exchange payable in
connection with the purchase of or conversion into United States dollars.
(e) To the extent that the undersigned or any of its
properties, assets or revenues may have, or may hereafter become entitled to, or
have attributed to it, any right of immunity, on the grounds of sovereignty or
otherwise, from (i) any legal action, suit or proceeding, (ii) setoff or
counterclaim, (iii) the jurisdiction of any court, (iv) service process, (v)
attachment upon or prior to judgment, (vi) attachment in aid of execution of
judgment, (vii) execution of judgment, or (viii) other legal process or
proceeding for the giving of any relief or for the enforcement of any judgment,
in any jurisdiction in which any action, suit or proceeding may at any time be
commenced with respect to its obligations, liabilities or any other matter under
or arising out of or in connection with this Agreement, the undersigned, to the
fullest extent it may effectively do so under applicable law, hereby irrevocably
and unconditionally waives, and agrees not to plead or claim, any such immunity
and consents to such relief and enforcement.
(f) THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE SECOND
PRIORITY NOTE DOCUMENTS, THE ADVANCES OR THE ACTIONS OF ANY SECURED PARTY IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
Very truly yours,
[NAME OF ADDITIONAL GRANTOR]
By
--------------------------------
Title:
Address for notices:
--------------------------------
--------------------------------
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EXHIBIT B TO THE
SECOND PRIORITY NOTES SECURITY AGREEMENT
FORM OF ACCOUNT CONTROL AGREEMENT
(DEPOSIT ACCOUNT/SECURITIES ACCOUNT)
ACCOUNT CONTROL AGREEMENT (this "AGREEMENT") dated as of
________________ among ____________, a _______________ (the "GRANTOR"), HSBC
Bank USA., National Association, as Trustee and Collateral Agent (the "SECURED
PARTY"), _______________ and ________________, a (_____________ as securities
intermediary and depository bank (the "ACCOUNT HOLDER")).
PRELIMINARY STATEMENTS:
(1) The Grantor has granted the Secured Party a second
priority security interest (the "SECURITY INTEREST") in the following accounts
maintained by the Account Holder for the Grantor (each, an "ACCOUNT" and
collectively, the "ACCOUNTS"):
[Insert account numbers and other identifying information.]
(2) Terms defined in Article 8 or 9 of the Uniform Commercial
Code in effect in the State of New York ("N.Y. UNIFORM COMMERCIAL CODE") are
used in this Agreement as such terms are defined in such Article 8 or 9.
NOW, THEREFORE, in consideration of the premises and of the
mutual agreements contained herein, the parties hereto hereby agree as follows:
SECTION 1. The Accounts. The Grantor and Account Holder
represent and warrant to, and agrees with, the Secured Party that:
(a) The Account Holder maintains each Account for the Grantor,
and all property (including, without limitation, all funds and financial assets)
held by the Account Holder for the account, of the Grantor are, and will
continue to be, credited to an Account in accordance with instructions given by
the Grantor (unless otherwise provided herein).
(b) To the extent that funds are credited to any Account, such
Account is a deposit account; and to the extent that financial assets are
credited to any Account, such Account is a securities account. The Account
Holder is (i) the bank with which each Account that is a deposit account is
maintained and (ii) the securities intermediary with respect to financial assets
held in any Account that is a securities account. The Grantor is (x) the Account
Holder's customer with respect to the Accounts and (y) the entitlement holder
with respect to financial assets credited from time to time to any Account.
(c) Notwithstanding any other agreement to the contrary, the
Account Holder's jurisdiction with respect to each Account for purposes of the
N.Y. Uniform Commercial Code is, and will continue to be for so long as the
Security Interest shall be in effect, the State of New York.
(d) Attached as Exhibit A hereto are statements of the
respective Accounts as of the date hereof showing the property credited to each
Account.
(e) The Grantor and Account Holder do not know of any claim to
or interest in any Account or any property (including, without limitation, funds
and financial assets) credited to any Account, except for claims and interests
of the parties referred to in this Agreement.
SECTION 2. Confirmation of Grant of Security Interest. The
Grantor hereby confirms that it has granted to the Secured Party a second
priority security interest in the Accounts, all property credited thereto and
all proceeds thereof, pursuant to the Second Priority Notes Security Agreement
(the "SECURITY AGREEMENT") dated September 30, 2004 among the Grantor, the
Secured Party, and certain other parties thereto. To the extent (and only to the
extent) that such grant is for any reason found to be invalid, the Grantor
hereby grants to the Secured Party a second priority security interest in the
Accounts, all property credited thereto from time to time, all proceeds thereof,
and all other property related thereto as more fully described in the Security
Agreement, as security for the Secured Obligations (as defined in the Security
Agreement).
SECTION 3. Control by Secured Party. The Account Holder will
comply with (i) all instructions directing disposition of the funds in any and
all of the Accounts, (ii) all notifications and entitlement orders that the
Account Holder receives directing it to transfer or redeem any financial asset
in any and all of the Accounts, and (iii) all other directions concerning any
and all of the Accounts, including, without limitation, directions to distribute
to the Secured Party proceeds of any such transfer or redemption or interest or
dividends on property in any and all of the Accounts (any such instruction,
notification or direction referred to in clause (i), (ii) or (iii) above being
an "ACCOUNT DIRECTION"), in each case of clauses (i), (ii) and (iii) above
originated by the Secured Party without further consent by the Grantor or any
other person or entity.
SECTION 4. Grantor's Rights in Accounts.
(a) The Account Holder will comply with Account Directions and
other directions concerning each Account originated by, and only by, the Secured
Party.
(b) Until the Account Holder receives a notice from the
Secured Party that the Secured Party will exercise exclusive control over any
Account (a "NOTICE OF EXCLUSIVE CONTROL" with respect to such Account), the
Account Holder may distribute to the Grantor all interest and regular cash
dividends on property (including, without limitation, funds and financial
assets) in such Account.
(c) If the Account Molder receives from the Secured Party a
Notice of Exclusive Control with respect to any Account, the Account Holder will
cease distributing to the Grantor all interest and dividends on property
(including, without limitation, funds and financial assets) in such Account.
SECTION 5. Priority of Secured Party's Security Interest. (a)
The Account Holder (i) subordinates to the Security Interest and in favor of the
Secured Party any security interest, lien, or right of recoupment or setoff that
the Account Holder may have, now or in the future, against any Account or
property (including, without limitation, any funds and financial assets)
credited to any Account, and (ii) agrees that it will not exercise any right in
respect of any such security interest or lien or any such right of recoupment or
setoff until the Security Interest is terminated, except that the Account Holder
(A) will retain its prior security interest and lien on property credited to any
Account, (B) may exercise any right in respect of such security interest or
lien, and (C) may exercise any right of recoupment or setoff against any
Account, in the case of clauses (A), (B) and (C) above, to secure or to satisfy,
and only to secure or to satisfy, payment (x) for such property, (y) for its
customary fees and expenses for the routine maintenance and operation of such
Account, and (z) if such Account is a deposit account, for the face amount of
any items that have been credited to such Account but are subsequently returned
unpaid because of uncollected or insufficient funds.
(b) The Account Holder will not enter into any other agreement
with any person or entity relating to Account Directions or other directions
with respect to any Account.
SECTION 6. Statements, Confirmations and Notices of Adverse
Claims. (a) The Account Holder will send copies of all statements and
confirmations for each Account simultaneously to the Secured Party and the
Grantor.
(b) When the Account Holder knows of any claim or interest in
any Account or any property (including, without limitation, funds and financial
assets) credited to any Account other than the claims and interests of the
parties referred to in this Agreement, the Account Holder will promptly notify
the Secured Party and the Grantor of such claim or interest.
SECTION 7. The Account Holder's Responsibility. (a) Except for
permitting a withdrawal, delivery, or payment in violation of Section 4, the
Account Holder will not be liable to the Secured Party for complying with
Account Directions or other directions concerning any Account from the Grantor
that are received by the Account Holder before the Account Holder receives and
has a reasonable opportunity to act on a Notice of Exclusive Control.
(b) The Account Holder will not be liable to the Grantor or
the Secured Party for complying with a Notice of Exclusive Control or with an
Account Direction or other direction concerning any Account originated by the
Secured Party, even if the Grantor notifies the Account Holder that the Secured
Party is not legally entitled to issue the Notice of Exclusive Control or
Account Direction or such other direction unless the Account Holder takes the
action after it is served with an injunction, restraining order, or other legal
process enjoining it from doing so, issued by a court of competent jurisdiction,
and had a reasonable opportunity to act on the injunction, restraining order or
other legal process.
(c) This Agreement does not create any obligation of the
Account Holder except for those expressly set forth in this Agreement and, in
the case of any Account that is a securities account, in Part 5 of Article 8 of
the N.Y. Uniform Commercial Code and, in the case of any Account that is a
deposit account, in Article 4 of the N.Y. Uniform Commercial Code. In
particular, the Account Holder need not investigate whether the Secured Party is
entitled tinder the Secured Party's agreements with the Grantor to give an
Account Direction or other direction concerning any Account or a Notice of
Exclusive Control. The Account Holder may rely on notices and communications it
believes given by the appropriate party.
SECTION 8. Indemnity. The Grantor will indemnify the Account
Holder, its officers, directors, employees and agents against claims,
liabilities and expenses arising out of this Agreement (including, without
limitation, reasonable attorney's fees and disbursements), except to the extent
the claims, liabilities or expenses are caused by the Account Holder's gross
negligence or willful misconduct as found by a court of competent jurisdiction
in a final, non-appealable judgment.
SECTION 9. Termination; Survival. (a) The Secured Party may
terminate this Agreement by notice to the Account Holder and the Grantor. If the
Secured Party notifies the Account Holder that the Security Interest has
terminated, this Agreement will immediately terminate.
(b) The Account Holder may terminate this Agreement on 60
days' prior notice to the Secured Party and the Grantor, provided that before
such termination the Account Holder and the Grantor shall make arrangements to
transfer the property (including, without limitation, all funds and financial
assets) credited to each Account to another Account Holder that shall have
executed, together with the Grantor, a control agreement in favor of the Secured
Party in respect of such property in substantially the form of this Agreement or
otherwise in form and substance satisfactory to the Secured Party.
(c) Sections 7 and 8 will survive termination of this
Agreement.
SECTION 10. Governing Law. This Agreement and each Account
will be governed by the law of the State of New York. The Account Holder and the
Grantor may not change the law governing any Account without the Secured Party's
express prior written agreement.
SECTION 11. Entire Agreement. This Agreement is the entire
agreement, and supersedes any prior agreements, and contemporaneous oral
agreements, of the parties concerning its subject matter.
SECTION 12. Amendments. No amendment of, or waiver of a right
under, this Agreement will be binding unless it is in writing and signed by the
party to be charged.
SECTION 13. Financial Assets. The Account Holder agrees with
the Secured Party and the Grantor that, to the fullest extent permitted by
applicable law, all property (other than funds) credited from time to time to
any Account will be treated as financial assets under Article 8 of the N.Y.
Uniform Commercial Code.
SECTION 14. Notices. A notice or other communication to a
party under this Agreement will be in writing (except that Account Directions
may be given orally), will be sent to the party's address set forth under its
name below or to such other address as the party may notify the other parties
and will be effective on receipt.
SECTION 15. Binding Effect. This Agreement shall become
effective when it shall have been executed by the Grantor, the Secured Party and
the Account Holder, and thereafter shall be binding upon and inure to the
benefit of the Grantor, the Secured Party and the Account Holder and their
respective successors and assigns.
SECTION 16. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of an original executed
counterpart of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
[NAME OF GRANTOR]
By:
---------------------------------------
Name:
Title:
Address:
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HSBC Bank USA, National Association,
as Trustee and Collateral Agent
By:
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Name:
Title:
Address:
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[NAME OF ACCOUNT HOLDER]
By:
---------------------------------------
Name:
Title:
Address:
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EXHIBIT C TO THE
SECOND PRIORITY NOTES SECURITY AGREEMENT
CONSENT AND AGREEMENT OF
RAVELSTON MANAGEMENT INC.
The undersigned hereby (a) acknowledges notice of, and
consents to the terms and provision of, the Second Priority Notes Security
Agreement dated as of September 30, 2004 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the "SECOND PRIORITY NOTES
SECURITY AGREEMENT", the terms defined therein being used herein as therein
defined) among ▇▇▇▇▇▇▇▇▇ Inc. and certain other grantors from time to time party
thereto and HSBC Bank USA, National Association, as Trustee and Collateral Agent
(the "SECOND PRIORITY NOTES COLLATERAL AGENT") for the Second Priority Secured
Parties referred to therein, (b) consents in all respects to the pledge and
assignment to the Second Priority Notes Collateral Agent of all of the Grantor's
(as defined below) right, title and interest in, to and under the Assigned
Agreement (as defined below) pursuant to the Second Priority Notes Security
Agreement, (c) acknowledges that the Grantor has provided it with notice of the
right of the Second Priority Notes Collateral Agent in the exercise of its
rights and remedies under the Second Priority Notes Security Agreement to make
all demands, give all notices, take all actions and exercise all rights of the
Grantor under the Assigned Agreement, and (d) agrees with the Second Priority
Notes Collateral Agent that:
(1) A true copy of the Support Agreement between the
undersigned and ▇▇▇▇▇▇▇▇▇ Inc. (the "GRANTOR") dated as of March 10,
2003 (the "ASSIGNED AGREEMENT), including, without limitation, all
amendments, modifications, restatements and supplements is attached
hereto as Schedule I. The Assigned Agreement is in full force and
effect and enforceable against the undersigned, and the undersigned is
not aware of any default under the Assigned Agreement or any event that
would give any party the right to terminate or rescind the Assigned
Agreement. No prepayments have been made of any amounts to become due
under the Assigned Agreement.
(2) The undersigned will make all payments to be made by it
under or in connection with the Assigned Agreement provided that in the
event that an Event of Default has occurred and is continuing, the
undersigned will make payment of 100% of all amounts payable thereunder
directly to the First Priority Notes Collateral Agent (as defined in
the Second Priority Notes Security Agreement).
(3) All payments referred to in paragraph 2 above shall be
made by the undersigned irrespective of, and without deduction for, any
counterclaim, defense, recoupment or set-off and shall be final, and
the undersigned will not seek to recover from any Secured Party for any
reason any such payment once made.
(4) After the occurrence of an Event of Default which is
continuing, the First Priority Notes Collateral Agent (as defined in
the Second Priority Notes Security Agreement) or its designee shall be
entitled to exercise any and all rights and remedies of the Grantor
under the Assigned Agreement in accordance with the terms of the First
Priority Notes Security Agreement (as defined in the Second Priority
Notes Security Agreement), and the undersigned shall comply in all
respects with such exercise.
(5) The undersigned will not, without the prior written
consent of the Second Priority Notes Collateral Agent, except as
required pursuant to the First Priority Notes Indenture (as defined in
the Second Priority Note's Security Agreement) or the First Priority
Notes Security Agreement (i) cancel or terminate the Assigned Agreement
or consent to or accept any cancellation or termination thereof, or
(ii) amend, amend and restate, supplement or otherwise modify the
Assigned Agreement, except, in each case, to the extent otherwise
permitted under the Second Priority Note Documents referred to in the
Second Priority Notes Security Agreement.
(6) Except as required pursuant to the First Priority Notes
Indenture or the First Priority Notes Security Agreement, in the event
of a default by the Grantor in the performance of any of its
obligations under the Assigned Agreement, or upon the occurrence or
non-occurrence of any event or condition under the Assigned Agreement
which would immediately or with the passage of any applicable grace
period or the giving of notice, or both, enable the undersigned to
terminate or suspend its obligations under the Assigned Agreement, the
undersigned shall not terminate the Assigned Agreement until it first
gives the First Priority Notes Collateral Agent written notice of the
default and permits the First Priority Notes Collateral Agent to cure
the default within a period of 30 days after the later of (i) notice of
default having been given to the First Priority Notes Collateral Agent
by the undersigned and (ii) the expiration of the applicable cure
period provided in the Assigned Agreement for the Grantor to cure the
default.
(7) The undersigned shall deliver to the Second Priority Notes
Collateral Agent, concurrently with the delivery thereof to the
Grantor, a copy of each notice, request or demand given by the
undersigned pursuant to the Assigned Agreement.
(8) Except as specifically provided in this Consent and
Agreement, neither the Second Priority Notes Collateral Agent nor any
other Second Priority Secured Party shall have any liability or
obligation under the Assigned Agreement as a result of this Consent and
Agreement, the Second Priority Notes Security Agreement or otherwise.
(9) Upon the enforcement of the First Priority Notes Security
Agreement by the First Priority Notes Collateral Agent and the transfer
of the Assigned Agreement to a transferee, the undersigned will
recognize the transferee as the counterparty to the Assigned Agreement
in the place and stead of the Grantor.
This Consent and Agreement shall be binding upon the
undersigned and its successors and assigns, and shall inure, together with the
rights and remedies of the Second Priority Notes Collateral Agent hereunder, to
the benefit of the Second Priority Secured Parties and their successors,
transferees and assigns. This Consent and Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the undersigned has duly executed this
Consent and Agreement as of the date set opposite its name below.
Dated: September ___, 2004 RAVELSTON MANAGEMENT INC.
By:
-----------------------------
Name:
Title:
SCHEDULE I