EXHIBIT 4.116
Prepared by and mail to:
▇▇▇▇▇▇▇▇ Chance US LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
DAVIDSON COUNTY, NORTH CAROLINA
DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT, FINANCING STATEMENT AND FIXTURE FILING
THIS DEED OF TRUST (this "Instrument") entered into as of the
15th day of May, 2003 but effective as of the 19th day of May, 2003 by MARCONI
COMMUNICATIONS, INC. (formerly known as Reltec Communications, Inc.), a Delaware
corporation ("Trustor"), having an address at c/o Marconi Corporation plc, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, to FIRST AMERICAN TITLE INSURANCE
COMPANY ("Trustee"), having an address at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, for the use and benefit of THE LAW DEBENTURE
TRUST CORPORATION p.l.c., a public limited company organized under the laws of
England and Wales, as Security Trustee for the Secured Creditors (as defined in
the Intercreditor Agreement) (together with any co-trustee, co-agent or other
entity appointed pursuant to clause 16 of the Intercreditor Agreement (as
defined below)) ("Beneficiary") under the Security Trust and Intercreditor Deed
dated the date hereof and made among Marconi Corporation plc as Issuer;
Beneficiary; the persons listed in Schedule 1 thereto as Guarantors; Law
Debenture Trust Company of New York as Senior Note Trustee; JPMorgan Chase Bank
as Junior Note Trustee; HSBC Bank plc as New Bonding Facility Agent; The Bank of
New York as Depositary, Paying Agent and Registrar; the persons listed in Part A
Schedule 2 thereto as Intra-Group Creditors; the persons listed in Part B
Schedule 2 thereto as Intra-Group Borrowers and the persons listed in Schedule 3
thereto as New Bonding Facility Banks (as amended, modified or supplemented from
time to time, the "Intercreditor Agreement"), having an address at ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇. Capitalized terms used herein
without definition shall have the respective meanings assigned to such terms in
the Intercreditor Agreement.
W I T N E S S E T H:
WHEREAS, Trustor is a United States wholly-owned subsidiary of
Marconi Corporation, plc (the "Issuer"), which is the Issuer under the
Indentures, the Notes and the New Bonding Facility Agreement;
WHEREAS, as of the date hereof and in favor of Beneficiary,
Trustor has entered into a Guarantee of the Senior Notes and Senior Note
Indenture, a Guarantee of the Junior Notes and the Junior Note Indenture and a
Composite Guarantee of certain other obligations under the Relevant Documents,
including the New Bonding Facility Agreement (collectively, the "Guarantees"),
pursuant to which Trustor has agreed to guarantee the "Guaranteed Obligations"
(as such term is defined in each of the Guarantees) and has agreed to secure the
Guaranteed Obligations and other obligations;
WHEREAS, Trustor has received substantial benefit from the
loans made under the Indentures, the New Bonding Facility Agreement and the
other Relevant Documents; and
WHEREAS, Beneficiary and the Secured Creditors have required
that Trustor execute and deliver this Instrument (i) in order to secure the
prompt and complete payment, observance and performance of all of the Secured
Obligations (as defined below) and (ii) as a condition precedent to Beneficiary
and the Secured Creditors entering into the Relevant Documents.
NOW, THEREFORE, in consideration of the premises and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
GRANTING CLAUSE
To secure the payment in full of the Secured Obligations (as
hereinafter defined), Trustor has bargained, sold, given, granted and conveyed
and does hereby bargain, sell, grant, remise, release, and convey, mortgage and
warrant to Trustee, its successors and assigns, in trust with power of sale for
the benefit of Beneficiary, its successors and assigns, and grant a security
interest to Beneficiary, its successors and assigns, in and to the following
described real estate in Davidson County, North Carolina (the "State"):
See Exhibit A attached hereto and by this reference made a
part hereof which real estate (the "Land"), together with all right, title and
interest, if any, which Trustor may now have or hereafter acquire in and to all
improvements, buildings and structures thereon of every nature whatsoever, is
herein called the "Premises."
TOGETHER WITH all right, title and interest, if any, including
any after-acquired right, title and interest, and including any right of use or
occupancy, which Trustor may now have or hereafter acquire in and to (a) all
easements, rights of way, gores of land or any lands occupied by streets, ways,
alleys, passages, sewer rights, air rights, development rights, water courses,
water rights and powers, and public places adjoining said Land, and any other
interests in property constituting appurtenances to the Premises, or which
hereafter shall in any way belong, relate or be appurtenant thereto and (b) all
hereditaments, gas, oil, minerals (with the right to extract, sever and remove
such gas, oil and minerals), and easements, of every nature whatsoever, located
in or on the Premises and all other rights and privileges thereunto belonging or
appertaining and all extensions, additions, improvements, betterments,
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renewals, substitutions and replacements to, or of any rights and interests
described in subparagraph (a) above and this subparagraph (b) (hereinafter
collectively called the "Property Rights").
TOGETHER WITH all ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ and development
rights hereafter acquired by Trustor for use in connection with and the
development of the Land, the Premises or the Property Rights and all additional
lands and estates therein which may, from time to time, by supplemental deed of
trust or otherwise, be expressly made subject to the lien of this Instrument.
TOGETHER WITH all right, title and interest, if any, including
any after-acquired right, title and interest which Trustor may now or hereafter
acquire in and to fixtures and appurtenances of every nature whatsoever now or
hereafter located in, on or attached to, and used or intended to be used in
connection with, or with the operation of, the Premises, including, but not
limited to, (a) all apparatus, machinery, and equipment of Trustor; (b) all
extensions, additions, improvements, betterments, renewals, substitutions, and
replacements to or of any of the foregoing (the items described in the foregoing
(a) and (b) being the "Fixtures"); and (c) all personal property and equipment
of every nature whatsoever now or hereafter located in or on the Premises,
including, but not limited to, (i) all screens, window shades, blinds,
wainscoting, storm doors and windows, floor coverings, and awnings of Trustor;
(ii) all apparatus, machinery, equipment and appliances of Trustor not included
as Fixtures; (iii) all items of furniture, furnishings, and personal property of
Trustor; and (iv) all extensions, additions, improvements, betterments,
renewals, substitutions, and replacements to or of any of the foregoing
(i)-(iii) (the items described in the foregoing (i)-(iv) and any other personal
property referred to in this paragraph being the "Personal Property") and in and
to the proceeds of the Personal Property. It is mutually agreed, intended and
declared that the Premises and all of the Property Rights and Fixtures owned by
Trustor (referred to collectively herein as the "Real Property") shall, so far
as permitted by law, be deemed to form a part and parcel of the Land and for the
purpose of this Instrument to be real estate and covered by this Instrument. It
is also agreed that if any of the property herein conveyed is of a nature so
that a security interest therein can be perfected under the Uniform Commercial
Code as enacted by the State ("UCC"), this Instrument shall constitute a
security agreement, fixture filing and financing statement, and Trustor agrees
to execute, deliver and file or refile any financing statement, continuation
statement, or other instruments Beneficiary may require from time to time to
perfect or renew such security interest under the UCC. To the extent permitted
by law, (x) all of the Fixtures are or are to become fixtures on the Land; and
(y) this Instrument, upon recording or registration in the real estate records
of the proper office, shall constitute a "fixture-filing" within the meaning of
Sections 25-9-334 and 25-9-502 of the UCC. Subject to the terms and conditions
of the Intercreditor Agreement, the remedies for any violation of the covenants,
terms and conditions of the agreements herein contained shall be as prescribed
herein or by general law, or, as to that part of the security in which a
security interest may be perfected under the UCC, by the specific statutory
consequences now or hereafter enacted and specified in the UCC, all at the
Beneficiary's sole election.
TOGETHER WITH all the estate, right, title and interest of the
Trustor, in and to all (i) judgments, insurance proceeds, unearned premiums,
awards of damages and settlements, and any interest thereon, resulting from
condemnation proceedings or the taking of the Real Property, or any part
thereof, under the power of eminent domain or for any damage (whether caused by
such taking or otherwise) to the Real Property, the Personal Property or any
part thereof, or to any rights appurtenant thereto, and all proceeds of any
sales or other dispositions of the Real Property, the Personal Property or any
part thereof; and (subject to the terms of the Intercreditor Agreement) the
Beneficiary is hereby authorized to collect and receive said awards and proceeds
and to give proper receipts and acquittances therefor, and to apply the same as
provided in the Intercreditor Agreement; (ii) contract rights, general
intangibles, actions and rights in action, relating to the Real Property or the
Personal Property, including, without limitation, all rights to insurance
proceeds and unearned premiums arising from or relating to damage to the Real
Property or the Personal Property; and (iii) proceeds, products, replacements,
additions, substitutions,
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renewals and accessions of and to the Real Property or the Personal Property.
(The rights and interests described in this paragraph shall hereinafter be
collectively called the "Intangibles.")
As additional security for the Secured Obligations, Trustor
does (i) hereby pledge and assign to Beneficiary from and after the date hereof
(including any period of redemption), primarily and on a parity with said real
estate, and not secondarily, all the rents, issues and profits of the Real
Property and all rents, issues, profits, revenues, royalties, bonuses, rights
and benefits due, payable or accruing (including all deposits of money as
advance rent, for security or as ▇▇▇▇▇▇▇ money or as downpayment for the
purchase of all or any part of the Real Property or the Personal Property) (the
"Rents") under any and all present and future leases, contracts or other
agreements relating to the ownership of the Real Property or the Personal
Property or to the occupancy of all or any portion of the Real Property and,
(ii) except to the extent such a transfer or assignment is not permitted by the
terms thereof (and a consent to the transfer or assignment has not been
obtained), does hereby transfer and assign to Beneficiary all such leases,
contracts and agreements (including all Trustor's rights (x) under any contracts
for the sale of any portion of the Mortgaged Property (as hereinafter defined)
and (y) to all revenues and royalties under any oil, gas and mineral leases
relating to the Real Property) (the "Leases"). Beneficiary hereby grants to
Trustor the right to collect and use the Rents as they become due and payable
under the Leases, but not more than one (1) month in advance thereof, so long as
no Trigger Event shall have occurred, provided that the existence of such right
shall not operate to subordinate this assignment to any subsequent assignment,
in whole or in part, by Trustor, and any such subsequent assignment shall be
subject to the rights of the Trustee and Beneficiary under this Instrument.
Trustor further agrees to execute and deliver such assignments of leases or
assignments of land sale contracts as Beneficiary may from time to time request
solely for the purpose of creating, protecting, perfecting or maintaining an
enforceable lien thereon and an enforceable and valid assignment of Leases and
Rents. Upon the occurrence of a Trigger Event, (i) the Trustor agrees, upon
demand, to deliver to the Beneficiary all of the Leases with such additional
assignments thereof as the Beneficiary may request and agrees that the
Beneficiary may assume the management of the Real Property and collect the Rents
(provided that such assumption of management shall be done solely to the extent
necessary to collect the Rents in the event of a Material Default), applying the
Rents upon the Secured Obligations (as defined below) in the manner provided in
the Intercreditor Agreement, and (ii) the Trustor hereby authorizes and directs
all tenants, purchasers or other persons occupying or otherwise acquiring any
interest in any part of the Real Property to pay the Rents due under the Leases
to the Beneficiary upon request of the Beneficiary. Trustor hereby appoints
Beneficiary as its true and lawful attorney-in-fact to manage said property and
collect the Rents, with full power to bring suit for collection of the Rents and
possession of the Real Property (provided that such possession shall be taken
solely to the extent necessary to collect such Rents in the event of a Material
Default), giving and granting unto said Beneficiary and unto its agent or
attorney full power coupled with an interest and authority to do and perform all
and every act and thing whatsoever requisite and necessary to be done in the
protection of the security hereby conveyed (provided that such acts shall be
limited to those necessary to collect the Rents in the event of a Material
Default); provided, however, that (i) this power of attorney and assignment of
Rents shall not be construed as an obligation upon said Beneficiary to make or
cause to be made any repairs that may be needful or necessary, and (ii)
Beneficiary agrees that so long as no Trigger Event shall have occurred,
Beneficiary shall permit Trustor to perform the aforementioned management
responsibilities. Upon Beneficiary's receipt of the Rents, at Beneficiary's
option, it may: (i) pay charges for collection hereunder, costs of necessary
repairs and other costs requisite and necessary during the continuance of this
power of attorney and assignment of Rents, (ii) pay general and special taxes,
insurance premiums, and, thereafter, (iii) distribute the balance of the Rents
pursuant to the provisions of the Intercreditor Agreement. This power of
attorney and assignment of rents shall be irrevocable until this Instrument
shall have been satisfied and released of record and the releasing or
reconveyance of this Instrument shall act as a revocation of this power of
attorney and assignment of rents. Subject to Beneficiary's grant to Trustor of
the collection and use of the Rents set forth above, Beneficiary shall have and
hereby expressly reserves the right and privilege (but assumes no obligation) to
demand, collect,
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▇▇▇ for, receive and recover the Rents, or any part thereof, now existing or
hereafter made, and apply the same in accordance with the provisions of the
Intercreditor Agreement. For purposes of this Instrument, a "Trigger Event"
shall mean (i) an Enforcement Event or (ii) a "Material Default" which for
purposes of this Instrument shall mean any event that is (A) an Insolvency Event
which is also an Event of Default or (B) any Event of Default that the
Instructing Trustee notifies and instructs the Beneficiary to act in response to
pursuant to the Intercreditor Agreement. Notwithstanding anything herein, upon
an Enforcement Event, Beneficiary shall have the absolute right and option to
exercise any and all rights and remedies provided for in this Instrument and
available at law or in equity.
All of the property described above, and each item of property
herein described, and all other rights of Trustor in and to such items of
property, not limited to, but including, the Land, the Premises, the Property
Rights, the Fixtures, the Real Property, the Personal Property, the Intangibles,
the Rents and the Leases, is herein collectively referred to as the "Mortgaged
Property". As used herein, "Secured Obligations" means all present and future
indebtedness, liabilities and obligations (for the avoidance of doubt, including
any liabilities and obligations that have been cash-collateralized by the
Trustor), at any time of Trustor under the Relevant Documents (including this
Instrument), including any liability in respect of any further advances, if any,
made under the Relevant Documents, both actual and contingent and whether
incurred solely or jointly or in any other capacity together with any of the
following matters relating to or arising in respect of those liabilities and
obligations: (1) any refinancing, novation, deferral or extension; (2) any
obligation relating to any increase in the amount of such obligations; (3) any
claim for damages or restitution; and (4) any claim as a result of any recovery
by Trustor of a payment or discharge, or non-allowability, on the grounds of
preference; and any amounts that would be included in any of the above but for
any discharge, non-provability or unenforceability of those amounts in any
insolvency or other proceedings (including interest accruing after the
commencement of any insolvency or other proceedings).
Nothing herein contained shall be construed as constituting
the Beneficiary or any of its Delegates or any of the other Secured Creditors a
mortgagee-in-possession in the absence of the taking of actual possession of the
Mortgaged Property by the Beneficiary or any of its Delegates or any of the
Secured Creditors. Nothing contained in this Instrument shall be construed as
imposing on Beneficiary any of the obligations of the lessor under any lease of
the Mortgaged Property in the absence of an explicit assumption thereof by
Beneficiary. In the exercise of the powers herein granted to the Beneficiary, no
liability shall be asserted or enforced against the Beneficiary, all such
liability being expressly waived and released by Trustor.
TO HAVE AND TO HOLD the Mortgaged Property, properties, rights
and privileges hereby conveyed or assigned, or intended so to be, unto Trustee,
its successors and assigns, for the benefit of Beneficiary, its successors and
assigns, forever upon the trusts, terms and conditions and for the uses and
purposes herein set forth. The conveyance of the Mortgaged Property provided for
herein is made upon this special trust. If the Secured Obligations are paid and
performed in full and completely as and when due in accordance with their
respective terms, the conveyance provided for herein shall be released upon
satisfaction of the conditions set forth in Section 5.3 of the Intercreditor
Agreement and shall thereafter be null and void and may be canceled of record at
the request and cost of the Trustor and title shall revest as provided by law.
If, however, a Trigger Event shall have occurred, then Beneficiary shall be
entitled to invoke the remedies provided for in the granting clause above in
connection with the assignment of Leases and Rents and if an Enforcement Event
shall have occurred, then Beneficiary shall, in addition to all other rights and
remedies at law or equity provided, be entitled to invoke the remedies provided
for in Section 4.02 below including without limitation the right to foreclose
this Instrument by judicial proceedings or, at Beneficiary's election, the right
to demand that the Trustee foreclose this Instrument through exercise of the
power of sale herein granted to Trustee, and upon such demand by Beneficiary,
the Trustee shall have the right and the duty to foreclose this Instrument as
herein provided.
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Trustor hereby releases and waives all rights under and by virtue of the
homestead exemption laws of the State, if any.
The following provisions shall also constitute an integral
part of this Instrument:
ARTICLE I
[Reserved]
ARTICLE II
COVENANTS OF TRUSTOR
Section 2.01. Reserved.
Section 2.02. Leases Affecting the Real Property. All future
lessees under any Lease of the Real Property, or any part thereof, made after
the date of recording of this Instrument shall, at Beneficiary's option and
without any further documentation, attorn to Beneficiary as lessor if for any
reason Beneficiary becomes lessor thereunder, and, thereafter, upon demand, to
pay Rent to Beneficiary, and Beneficiary shall not be responsible under such
Lease for matters arising prior to Beneficiary becoming lessor thereunder. In
respect of each Lease which may be entered into on or after the date hereof, the
lien and estate, as well as the provisions, terms and conditions of each Lease
shall in all respects be subordinate and junior to the lien of this Instrument.
Section 2.03. Further Assurances. Trustor, at its sole cost and
expense, shall (i) upon request of Beneficiary promptly correct any defect or
error which may be discovered in this Instrument or any financing statement or
other document relating hereto solely to the extent necessary to create,
effectuate, complete, perfect, continue or preserve the lien of this Instrument
on the Mortgaged Property, and (ii) promptly execute, acknowledge, deliver,
record and re-record, register and re-register, and file and re-file this
Instrument, any amendment to this Instrument and any financing statements or
other documents which Beneficiary may request in writing from time to time (all
in form and substance reasonably satisfactory to Beneficiary) in order (A) to
create, effectuate, complete, perfect, continue or preserve the lien of this
Instrument as a first priority lien on the Mortgaged Property, whether now owned
or hereafter acquired, subject only to the matters set forth on Exhibit B
attached hereto and made a part hereof and except for the Permitted Liens (as
defined in the Indentures), or (B) to create, effectuate, complete, perfect,
continue, preserve or validate any right, power or privilege granted or intended
to be granted to the Beneficiary hereunder or otherwise accomplish the purposes
of this Instrument. To the extent permitted by law and to the extent that
Trustor fails to do so as required hereunder, the Trustor hereby authorizes
Beneficiary to file financing statements or continuation statements covering the
Mortgaged Property.
Section 2.04. Casualty Proceeds. Trustor hereby assigns to
Beneficiary, as additional security, all proceeds or awards of damage resulting
from a casualty event or condemnation proceedings or the taking of or injury to
the Real Property for public use. All such proceeds or awards paid to
Beneficiary hereunder shall be applied in accordance with the Indentures.
Section 2.05. Inspections. Trustor hereby authorizes Beneficiary,
its agents, employees and representatives, upon reasonable prior written notice
to Trustor (except in an emergency or following the occurrence of any Trigger
Event, in which case notice shall not be required) to visit and inspect the
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Mortgaged Property or any portion(s) thereof, all at such reasonable times and
as often as Beneficiary may reasonably request.
Section 2.06. Indemnity. Trustor hereby indemnifies Beneficiary or
any person designated by it and keep Beneficiary or such person designated by it
indemnified against any and all costs, claims and liabilities which it may incur
as a result of anything done by it as an attorney-in-fact for Trustor in the
proper exercise of any of the powers conferred, or purported to be conferred,
thereon by this Instrument unless such cost, claim or liability arises as a
result of the negligence or wilful misconduct of Beneficiary or such person
designated by it. For clarification purposes, the indemnity set forth in this
Section 2.06 shall apply solely in those instances where Beneficiary or a
Delegate acts as an attorney-in-fact for Trustor for purposes of this
Instrument.
Section 2.07. After Acquired Property Interests. All right, title
and interest of Trustor in and to all of the Mortgaged Property, hereafter
acquired by Trustor ("After Acquired Property Interests"), immediately upon such
acquisition, without any further mortgage, conveyance, assignment or other act
by Trustor, shall become subject to the lien of this Instrument as fully and
completely, and with the same effect, as though owned by Trustor on the date
hereof and specifically described in the granting clauses hereof. Trustor shall
execute and deliver to Beneficiary all such other deeds of trust or mortgages
and other agreements as Beneficiary may require for the purpose of expressly and
specifically subjecting such After Acquired Property Interests to the lien of
this Instrument. Trustor hereby irrevocably authorizes and appoints Beneficiary
as the agent and attorney-in-fact of Trustor to execute all such documents and
instruments on behalf of Trustor, which appointment shall be irrevocable and
coupled with an interest, if the Trustor fails or refuses to do so within ten
(10) days after written request therefor by Beneficiary.
Section 2.08. Expenses and Costs. Trustor shall, from time to time
and promptly on demand by the Beneficiary reimburse to the Beneficiary all costs
and expenses (including legal fees) on a full indemnity basis incurred by
Beneficiary and any Delegate in connection with:
1. the execution, release and discharge of this Instrument and
the security created hereby or intended to be created hereby
in respect of the Mortgaged Property and the completion of the
transactions and perfection of the security contemplated in
this Instrument or forming part of the security created hereby
or intended to be created hereby in respect of the Mortgaged
Property;
2. the actual or contemplated exercise, preservation and/or
enforcement of any of the rights, powers and remedies of, or
the performance of the duties and obligations of, Beneficiary
or any Delegate, or any amendment or waiver in respect of this
Instrument;
3. the foreclosure (whether judicial or by power of sale) of any
Mortgaged Property; and
4. the preservation and/or enforcement of the security created
hereby or intended to be created hereby in respect of the
Mortgaged Property,
which shall carry interest from the date of such demand until so reimbursed at
the rate and on the basis as mentioned in Clause 18.4 of the Intercreditor
Agreement.
Section 2.09. Taxes. Trustor shall pay, promptly on demand of
Beneficiary all stamp, registration, notarial and other similar taxes or fees
paid or payable by Beneficiary in connection with any action taken or
contemplated by or on behalf of the Beneficiary for perfecting, maintaining,
enforcing, releasing, cancelling, reassigning or resolving any doubt concerning,
or for any other purpose in relation to this Instrument, any amendment thereto,
any transfer and/or assignment of the rights and/or obligations
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under the same or the security created hereby or intended to be created hereby
in respect of the Mortgaged Property and shall, from time to time, indemnify
Beneficiary promptly on demand against any liabilities, costs, claims and
expenses resulting from any failure to pay by Trustor or any delay by Trustor in
paying any such taxes or fees.
ARTICLE III
BENEFICIARY'S RIGHTS
Section 3.01. Performance of Trustor's Obligations. Trustor agrees
that, upon the occurrence of an Enforcement Event, Beneficiary may, but need
not, make any payment or perform any act hereinbefore required of Trustor, in
any form and manner deemed expedient. By way of illustration and not in
limitation of the foregoing, Beneficiary may, but need not, (i) make full or
partial payments of insurance premiums which are unpaid by Trustor, coordinate
liens or encumbrances, if any, (ii) purchase, discharge, compromise or settle
any tax lien or any other lien, encumbrance, suit, proceeding, title or claim
thereof, or (iii) redeem all or any part of the Premises from any tax or
assessment. All moneys paid for any of the purposes herein authorized and all
other moneys advanced by Beneficiary to protect the Mortgaged Property and the
lien hereof shall be additional Secured Obligations and shall become immediately
due and payable without notice and shall bear interest thereon at the rate set
forth in Clause 18.4 of the Intercreditor Agreement until paid to Beneficiary in
full. In making any payment hereby authorized relating to taxes, assessments or
prior or coordinate liens or encumbrances, Beneficiary shall be the sole judge
of the legality, validity and priority thereof and of the amount necessary to be
paid in satisfaction thereof.
ARTICLE IV
REMEDIES & RIGHTS
Section 4.01. Remedies of Beneficiary. Upon the occurrence of an
Enforcement Event, Beneficiary may, without notice to or demand upon Trustor,
declare this Instrument to be in default, and, in addition to all other rights
and remedies at law or in equity available to Beneficiary or as otherwise
provided for in the Intercreditor Agreement or the Indentures, to the extent
permitted by applicable law, the following provisions shall apply:
(a) Beneficiary's Power of Enforcement. It shall be
lawful for Beneficiary to (i) immediately direct the Trustee to sell the
Mortgaged Property, either in whole or in separate parcels, as prescribed by the
State law, under power of sale, which power is hereby granted to Trustee to the
full extent permitted by the State law, or (ii) immediately foreclose this
Instrument by judicial action. The court in which any proceeding is pending for
the purpose of sale under or foreclosure of this Instrument if such remedy is
taken or any court of competent jurisdiction may, at once or at any time
thereafter, either before or after sale, without notice and without requiring
bond, and without regard to the solvency or insolvency of any person liable for
payment of the Secured Obligations, and without regard to the then value of the
Mortgaged Property or the occupancy thereof as a homestead, appoint a receiver
(the provisions for the appointment of a receiver and assignment of rents being
an express condition upon which the Secured Obligations hereby secured are made)
for the benefit of Beneficiary, with power to collect the Rents, due and to
become due, during such foreclosure suit or proceeding for such sale and the
full statutory period of redemption, notwithstanding any redemption. The
receiver, out of the Rents, when collected, may pay costs incurred in the
management and operation of the Real Property, prior and subordinate liens, if
any, and taxes, assessments, water and other utilities and insurance, then due
or thereafter accruing, and may make and pay for any necessary repairs to the
Real Property or the Personal Property, and may pay all or any part of the
Secured Obligations or other sums secured hereby or any
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deficiency decree entered in such foreclosure proceedings. Upon or at any time
after the filing of a suit to foreclose this Instrument, the court in which such
suit is filed shall have full power to enter an order placing Beneficiary in
possession of the Real Property with the same power granted to a receiver
pursuant to this subparagraph and with all other rights and privileges of a
mortgagee-in-possession under applicable law.
(b) Beneficiary's Right to Enter and Take Possession,
Operate and Apply Income. Beneficiary shall, at its option, have the right,
acting through its agents or attorneys, either with or without process of law,
forcibly or otherwise, to enter upon and take possession of the Real Property,
expel and remove any persons, goods, or chattels occupying or upon the same, to
collect or receive all the Rents, and to manage and control the same, and to
lease the same or any part thereof, from time to time, and, after deducting all
reasonable attorneys' fees and expenses, and all reasonable expenses incurred in
the protection, care, maintenance, management and operation of the Real
Property, distribute and apply the remaining net income in accordance with the
terms of the Intercreditor Agreement or upon any deficiency decree entered in
any foreclosure proceedings.
(c) Sale of Mortgaged Property. Beneficiary shall, at its
option, have the right to effect a trustee's sale of the Mortgaged Property in
whole or in part in lieu of judicial foreclosure. Beneficiary may instruct the
Trustee to sell such portion of the Mortgaged Property not theretofore released
from the lien of this Instrument as one parcel in its entirety or in any part
thereof, either in mass or in parcels, at public vendue, to the highest bidder
for cash in the county in which the Mortgaged Property is situated, first giving
notice of the time and place of sale, and a description of the property to be
sold, by advertisement published as provided by the laws of the State. The
Trustee shall deliver to the purchaser at any such trustee's sale its deed,
without warranty, which shall convey to the purchaser the interest in the
property which the Trustor has or has the power to convey at the time of the
execution of this or hereafter. The Trustee's deed shall recite the facts
showing that the sale was conducted in compliance with all the requirements of
law and of this Instrument, which recital shall be prima facie evidence of such
compliance and conclusive evidence thereof in favor of bona fide purchasers and
encumbrances for value.
(d) Additional Provisions Regarding Power of Sale. (i) In
exercising the power of sale herein conferred, after having been instructed by
the Beneficiary to do so, the Trustee shall comply with all applicable laws in
effect with respect to the exercise of powers of sale contained in deeds of
trust as of the date of the commencement of the proceeding. The Trustor agrees
that in the event of a sale under the power of sale hereunder, the Beneficiary
shall have the right to bid thereat. The Trustee may require that the successful
bidder at any sale deposit immediately with the Trustee cash or certified check
in an amount not to exceed ten percent (10%) of the bid, provided notice of such
requirement is contained in the advertisement of sale. The bid may be rejected
if the deposit is not immediately made, and thereupon the next highest bidder
may be declared to be the purchaser. Such deposit shall be refunded in case a
resale is had; otherwise, it shall be applied to the purchase price. If personal
property is sold hereunder, it need not be at the place of sale; the published
notice, however, shall state the time and place where such personal property may
be inspected prior to sale.
(ii) Notwithstanding the provisions of Section
4.02 of this Instrument, the proceeds of any sale of the Mortgaged Property
pursuant to the power of sale contained herein shall be applied first to the
costs and expenses of foreclosure, including, but not limited to a Trustee's
commission equal to five percent (5%) of the highest bid and to all costs,
expenses and reasonable attorneys' fees incurred by the Trustee and by the
Beneficiary in connection with such sale, with the remaining proceeds to be
applied as provided in Section 4.02 of this Instrument. If a proceeding for sale
pursuant to the power of sale contained herein is commenced by Trustee but
terminated prior to its completion or is otherwise not completed, the Trustor
shall pay all expenses incurred by Trustee, including reasonable
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attorneys' fees and a partial Trustee's commission equal to the greater of (A)
the reasonable time and expense charges of such Trustee and (B) an amount
computed on the basis of a percentage of the fair market value of the Mortgaged
Property (as such fair market value shall be agreed upon by Trustor and
Beneficiary, or if not agreed upon, then as determined by the Clerk of the
Superior Court with jurisdiction over such matters, upon evidence submitted by
the parties) in accordance with the following schedule, to wit: one tenth of one
percent (.1%) of such fair market value before the Trustee issues a notice of
hearing on the right to sell; eleven one hundredths of one percent (.11%) of
such fair market value after issuance of said notice; twelve one hundredths of
one percent (.12%) of such fair market value after such hearing; and thirteen
one hundredths of one percent (.13%) of such fair market value after the initial
sale.
Section 4.02. Application of the Rents or Proceeds from Foreclosure
or Sale. The Rents and the proceeds of any sale (whether through a foreclosure
proceeding or Beneficiary's exercise of the power of sale) shall be distributed
and applied in accordance with the terms of the Intercreditor Agreement. Subject
to Section 4.01(d)(ii) of this Instrument in any foreclosure of this Instrument
by judicial action, or any sale of the Mortgaged Property under the power of
sale herein granted, and further subject to the terms and provisions of the
Intercreditor Agreement, there shall be allowed (and included in the decree for
sale in the event of a foreclosure by judicial action) to be paid out of the
Rents or the proceeds of such foreclosure proceeding and/or sale:
(a) Secured Obligations. All of the Secured Obligations
and other sums secured hereby which then remain unpaid;
(b) Other Advances. All other items advanced or paid by
Beneficiary pursuant to this Instrument, with interest thereon at the rate set
forth in Clause 18.4 of the Intercreditor Agreement from the date of
advancement; and
(c) Costs, Fees and Other Expenses. All court costs,
reasonable in-house and outside attorneys' and paralegals' fees and expenses,
costs of environmental surveys and guard or other security services, appraiser's
fees, advertising costs, notice expenses, expenditures for documentary and
expert evidence, stenographer's charges, publication costs, and costs (which may
be estimated as to items to be expended after entry of the decree) of procuring
all abstracts of title, title searches and examinations, title guarantees, title
insurance policies, surveys, and similar data with respect to title which
Beneficiary may deem necessary. All such expenses shall become additional
Secured Obligations and be immediately due and payable, with interest thereon at
the rate set forth in Clause 18.4 of the Intercreditor Agreement, when paid or
incurred by Beneficiary or Trustee in connection with any proceedings,
including, but not limited to, probate and bankruptcy proceedings, to which
Beneficiary or Trustee shall be a party, either as plaintiff, claimant or
defendant, by reason of this Instrument or any indebtedness hereby secured or in
connection with the preparations for the commencement of any suit for the
foreclosure, whether or not actually commenced, or sale under the power of sale
herein granted.
Section 4.03. Cumulative Remedies; Delay or Omission Not a Waiver.
Each remedy or right of Beneficiary shall not be exclusive of, but shall be in
addition to, every other remedy or right now or hereafter existing at law or in
equity. No delay in the exercise or omission to exercise any remedy or right
accruing on the occurrence or existence of any Material Default or Enforcement
Event shall impair any such remedy or right or be construed to be a waiver of
any such Material Default or Enforcement Event or acquiescence therein, nor
shall it affect any subsequent Material Default or Enforcement Event of the same
or different nature. Every such remedy or right may be exercised concurrently or
independently and when and as often as may be deemed expedient by Beneficiary.
The acceptance by Beneficiary, any successor administrative agent or any secured
party of any payment less than the amount of the Secured Obligation in question
shall be deemed to be an acceptance on account only and shall not be construed
as a waiver of any Material Default or Enforcement Event with respect thereto,
and the
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acceptance by Beneficiary, any successor administrative agent or any secured
party of any payment of, or on account of, any Secured Obligation shall not be
deemed to be a waiver of any Material Default or Enforcement Event other
occurrence hereunder or under any Relevant Documents with respect to any other
Secured Obligation. If Beneficiary has proceeded to enforce any remedy or right
hereunder or with respect hereto by foreclosure, sale, entry or otherwise, it
may compromise, discontinue or abandon such proceeding for any reason without
notice to Trustor or any other party (except any other agent, the Secured
Creditors or the other secured parties to the extent required by any Relevant
Documents); and, if any such proceeding shall be discontinued, abandoned or
determined adversely for any reason, Trustor and Beneficiary shall retain and be
restored to their former positions and rights hereunder with respect to the
Mortgaged Property, subject to the lien hereof except to the extent any such
adverse determination specifically provides to the contrary.
Section 4.04. Beneficiary's Remedies against Multiple Parcels. If
more than one property, lot or parcel is covered by this Instrument, and if this
Instrument is foreclosed upon, or judgment is entered upon any Secured
Obligations, or if Trustee effects a trustee's sale under power of sale,
execution may be made upon or Trustee may effect a trustee's sale against any
one or more of the properties, lots or parcels and not upon the others, or upon
all of such properties or parcels, either together or separately, and at
different times or at the same time, and execution sales or trustee's sale
herein granted may likewise be conducted separately or concurrently, in each
case at Beneficiary's election.
Section 4.05. No Merger. In the event of a foreclosure of this
Instrument or any other mortgage or deed of trust securing the Secured
Obligations, the Secured Obligations then due to the Beneficiary shall not be
merged into any decree of foreclosure entered by the court, and Beneficiary may
concurrently or subsequently seek to foreclose one or more other deeds of trust
which also secure said Secured Obligations.
Section 4.06. Waivers by Trustor. To the fullest extent permitted
under applicable law, Trustor shall not assert, and hereby irrevocably waives,
any right or defense Trustor may have under any statute or rule of law or equity
now or hereafter in effect relating to (a) homestead exemption, extension,
moratorium, stay, redemption, marshaling of the Mortgaged Property or the other
assets of Trustor, sale of the Mortgaged Property in any order or notice of
deficiency or intention to accelerate any Secured Obligation, (b) impairment of
any right of subrogation or reimbursement, (c) any requirement that at any time
any action must be taken against any other party, any portion of the Mortgaged
Property or any other asset of Trustor or any other party, (d) any provision
barring or limiting the right of Beneficiary to sell any Mortgaged Property
after any other sale of any other Mortgaged Property or any other action against
Trustor or any other party, (e) any provision barring or limiting the recovery
by Beneficiary of a deficiency after any sale of the Mortgaged Property, (f) any
other provision of applicable law which shall defeat, limit or adversely affect
any right or remedy of Beneficiary or any secured party under or with respect to
this Instrument or any other Relevant Documents as it relates to any Mortgaged
Property, (g) the right of Beneficiary to foreclose this Instrument in its own
name on behalf of all of the secured parties by judicial action as the real
party in interest without the necessity of joining any secured party or (h) the
Guarantees, including, without limitation, notice of existence, creation or
incurring of any new or additional indebtedness or obligation or of any action
or non-action on the part of Trustor or the Issuer, Beneficiary or any Secured
Creditor or on the part of any person whomsoever under the Intercreditor
Agreement, this Instrument or any of the other Relevant Documents in connection
with any obligation or evidence of indebtedness held by Beneficiary, as Security
Trustee for the Secured Creditors, or held by any of the Secured Creditors.
Appraisement of the Premises is hereby expressly waived, at the option of
Beneficiary, which such option shall be executed prior to the time any judgment
is tendered at foreclosure.
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Section 4.07. Jurisdiction and Process. (a) To the extent permitted
under applicable law, in any suit, action or proceeding arising out of or
relating to this Instrument or any other Relevant Documents insofar and only
insofar as it relates to any Mortgaged Property, Trustor (i) irrevocably
consents to the non-exclusive jurisdiction of any state or federal court sitting
in which the Premises is located and irrevocably waives any defense or objection
which it may now or hereafter have to the jurisdiction of such court or the
venue of such court or the convenience of such court as the forum for any such
suit, action or proceeding, and (ii) irrevocably consents to the service of (A)
any process in accordance with applicable law in any such suit, action or
proceeding, or (B) any notice relating to any sale, or the exercise of any other
remedy by Beneficiary hereunder by mailing a copy of such process or notice by
United States registered or certified mail, postage prepaid, return receipt
requested to Trustor at its address specified in or pursuant to Section 5.01;
such service to be effective in accordance with applicable law.
(b) Nothing in this Section shall affect the right of
Beneficiary to bring any suit, action or proceeding arising out of or relating
to this Instrument, or any other Relevant Documents in any court having
jurisdiction under the provisions therein or applicable law or to serve any
process, notice of sale or other notice in any manner permitted by this
Instrument, the other Relevant Documents or applicable law.
Section 4.08. Concerning Beneficiary. (a) Beneficiary is authorized
to take all such action as is provided to be taken by it as Beneficiary
hereunder and all such other action incidental thereto, subject to the terms and
provisions of the Intercreditor Agreement. As to any matters not expressly
provided for herein (including the timing and methods of realization upon the
Mortgaged Property), Beneficiary shall, in addition, act or refrain from acting
in accordance with the terms and provisions of the Intercreditor Agreement.
Beneficiary shall not be responsible for the existence, genuineness or value of
any of the Mortgaged Property or for the validity, perfection, priority or
enforceability of the lien of this Instrument on any of the Mortgaged Property,
whether impaired by operation of law or by reason of any action or omission to
act on its part hereunder. Beneficiary shall have the right, but shall have no
duty, to ascertain or inquire as to the performance or observance of any of the
terms of this Instrument by Trustor.
(b) Beneficiary may, at any time, delegate by power of
attorney or otherwise to any person(s) or entity(ies) the ability to exercise
any or all of the rights, powers and discretions vested in it by this Instrument
or appoint any person or entity to act as additional Beneficiary or as
co-trustee for the purpose of this Instrument, in accordance with and subject to
the terms of Clause 16 of the Intercreditor Agreement.
(c) In the event that Beneficiary acts as Trustor's
attorney in fact or otherwise as its agent as provided for under this
Instrument, Trustor shall ratify and confirm all things done and all documents
executed by Beneficiary in the exercise or purported exercise of all or any of
such powers or acts.
ARTICLE V
MISCELLANEOUS
Section 5.01. Notices. Except as otherwise provided herein, all
communication required or permitted to be given in connection with this
Instrument shall be in writing, and shall be given or served in the manner and
to the address, and deemed received, as provided in clause 20 of the
Intercreditor Agreement. All communications to the Trustee shall be sent to the
Trustee at:
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if to Trustee:
First American Title Insurance Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Trustee shall, from time to time, have the right to specify as the proper
addressee and/or address for the purposes of this Instrument any other party or
address in the United States upon giving five (5) days prior written notice in
the manner herein prescribed.
Section 5.02. Extension of Payments and Other Modifications.
Trustor agrees that, without affecting the liability of any person for payment
of the Secured Obligations or affecting the lien of this Instrument upon the
Mortgaged Property or any part thereof (other than persons or property
explicitly released as a result of the exercise by Beneficiary or Trustee of
their rights and privileges hereunder), Beneficiary may (without obligation), at
any time and from time to time, on request of the Trustor made in accordance
with the terms and provisions of the Intercreditor Agreement, without notice to
any person liable for payment of any Secured Obligations or to any other person
or entity, extend the time, or agree to alter or amend the terms of payment of
such Secured Obligations; provided, however, that such actions of Beneficiary
are expressly limited by the terms and provisions of the Intercreditor
Agreement. Trustor further agrees that any part of the security herein described
may be released with or without consideration without affecting the remainder of
the Secured Obligations, the remainder of the security or the lien of this
Instrument.
Section 5.03. Governing Law. Trustor agrees that this Instrument is
to be construed, governed and enforced in accordance with the laws of the State.
Wherever possible, each provision of this Instrument shall be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this Instrument shall be prohibited by or invalid under applicable
law, such provision shall be ineffective only to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Instrument.
Section 5.04. Satisfaction of Mortgage. Upon satisfaction of the
conditions set forth in Section 5.3 of the Intercreditor Agreement, this
conveyance or lien shall be null and void and, upon demand therefor following
such satisfaction, a satisfaction of mortgage or reconveyance of the Mortgaged
Property and any other documents required to release the lien of this Instrument
shall promptly be provided by Beneficiary to Trustor, at Trustor's sole expense,
without recourse to, or any representation or warranty by, the Beneficiary or
any of its nominees.
Section 5.05. Successors and Assigns Included in Parties. This
Instrument shall be binding upon the Trustor and upon the successors, assigns
and vendees of the Trustor and shall inure to the benefit of the Beneficiary's
successors and assigns and any principals it represents as agent; all references
herein to the Trustor and to the Beneficiary or Trustee shall be deemed to
include their successors and assigns and, as to Beneficiary, any principals it
represents as agent. Trustor's successors and assigns shall include, without
limitation, a receiver, trustee or debtor in possession of or for the Trustor.
Wherever used, the singular number shall include the plural, the plural shall
include the singular, and the use of any gender shall be applicable to all
genders.
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Section 5.06. Waiver of Appraisement, Valuation, Stay, Extension
and Redemption Laws. Trustor agrees, to the full extent permitted by law, that
in case of an Enforcement Event, neither Trustor nor anyone claiming through or
under it shall or will set up, claim or seek to take advantage of any
appraisement, valuation, stay, or extension laws now or hereafter in force, in
order to prevent or hinder the enforcement or foreclosure of this Instrument or
the absolute sale of the Mortgaged Property or the final and absolute putting
into possession thereof, immediately after such sale, of the purchaser thereat,
and Trustor, for itself and all who may at any time claim through or under it,
hereby waives, to the full extent that it may lawfully so do, the benefit of all
such laws, and any and all right to have the assets comprising the Mortgaged
Property marshalled upon any foreclosure of the lien hereof and agrees that
Trustee, or any court having jurisdiction to foreclose such lien may sell the
Mortgaged Property in part or as an entirety. Trustor represents that it has
been authorized to, and Trustor does hereby waive to the full extent permitted
by law any and all statutory or other rights of redemption from sale under power
of sale or from sale under any order or decree of foreclosure of this
Instrument, on its own behalf and on behalf of each and every person acquiring
any interest in or title to the Mortgaged Property subsequent to the date
hereof.
Section 5.07. Interpretation with Other Documents. Notwithstanding
anything in this Instrument to the contrary, (a) in the event of a conflict or
inconsistency between this Instrument and the provisions of the Intercreditor
Agreement, the provisions of the Intercreditor Agreement shall govern, and (b)
the exercise of any right or remedy by Beneficiary under this Instrument shall
be done in accordance with and is subject to the terms and provisions of the
Intercreditor Agreement.
Section 5.08. Future Advances. The parties hereto intend that, in
addition to any other debt or obligation secured hereby, this Instrument shall
secure unpaid balances of loan advances and other extensions of credit made
after this Instrument is delivered to the appropriate recording offices of the
State, whether such advances or extensions of credit made are obligatory or
otherwise, and such future advances or extensions of credit shall be secured to
the same extent as if such advances or extensions of credit were made on the
date hereof, although there may be no advance or extensions of credit made at
the time of the execution hereof and although there may be no indebtedness
outstanding at the time any advance or extension of credit is made. Such unpaid
balances of loan advances and other extensions of credit may or may not be
evidenced by notes executed pursuant to the applicable Relevant Documents.
Section 5.09. Additional Provisions Regarding Future Advances. It
is intended that this Instrument comply with the provisions of Section 45-67 et
seq. of the General Statutes of North Carolina. For purposes of complying with
the provisions of Section 45-68 of said statutes, the Trustor hereby represents
as follows:
(a) That this Instrument is given to secure future
Secured Obligations which may be incurred from time to time under the applicable
Relevant Documents;
(b) That the principal amount of present Secured
Obligations secured by this Instrument is approximately US$1,284,925,000.00 (the
amount funded at closing (not future advance amounts));
(c) That the maximum principal amount, including present
and future Secured Obligations, which may be secured by this Instrument at any
one time is US$1,284,925,000.00 (exclusive of interest and exclusive of advances
as may be made under the terms of the Indenture, or any other Relevant Documents
or any other instrument governing or securing the Secured Obligations for the
protection of collateral, payment of taxes, impositions and assessments,
attorneys' fees and costs and other sums which Trustor is required by the terms
of said instrument to repay), subject to the limitation that at no time shall
the total principal amount of Secured Obligations exceed said maximum principal
sum of
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US$1,284,925,000.00, plus interest, attorneys' fees and costs and other sums for
the protection of collateral, payment of taxes, impositions and assessments and
similar sums advanced by the Beneficiary or the Lenders which the Trustor is
obligated to repay hereunder or under the Relevant Documents or otherwise;
provided that the foregoing limitation shall apply only to the lien upon real
property located in the State of North Carolina created by this Instrument and
shall not in any manner limit, affect or impair any grant of a security interest
in or lien on any other real property or any personal property in favor of the
Secured Creditors, or in favor of the Beneficiary or any other agent for the
benefit of the Secured Creditors, under the provisions of this Instrument, any
other Relevant Documents or any other instruments governing or securing the
Secured Obligations or any other security agreement at any time executed by
Trustor;
(d) That the period within which such future Secured
Obligations may be incurred shall expire on October 31, 2008 and any extension
thereof shall be effective without the recordation of an amendment, modification
or supplement to this Instrument identifying the extended expiration date of
such period; and
(e) It shall not be a requirement for any such future
Secured Obligations to be secured hereby that the Trustor sign an instrument or
other notation stipulating that such Secured Obligations are secured by this
Instrument, as no such future Secured Obligations are required, under any
Relevant Documents or otherwise, to be evidenced by a written instrument or
notation.
Section 5.10. Invalid Provisions to Affect No Others. In the event
that any of the covenants, agreements, terms or provisions contained in this
Instrument shall be invalid, illegal or unenforceable in any respect, the
validity of the remaining covenants, agreements, terms or provisions contained
herein or in any other Relevant Documents shall not be in any way affected,
prejudiced or disturbed thereby. In the event that the application of any of the
covenants, agreements, terms or provisions of this Instrument is held to be
invalid, illegal or unenforceable, those covenants, agreements, terms and
provisions shall not be in any way affected, prejudiced or disturbed when
otherwise applied.
Section 5.11. Changes. Neither this Instrument nor any term hereof
may be changed, waived, discharged or terminated orally, or by any action or
inaction, but only by an instrument in writing signed by the party against which
enforcement of the change, waiver, discharge or termination is sought. To the
extent permitted by law, any agreement hereafter made by Trustor and Trustee or
Beneficiary relating to this Instrument shall be superior to the rights of the
holder of any intervening lien or encumbrance.
Section 5.12. Marshalling of Assets. Notice is hereby given that no
holder of any mortgage, lien or other encumbrance affecting all or a part of the
Mortgaged Property which is inferior to the lien of this Instrument shall have
any right to require the Beneficiary to marshal assets.
Section 5.13. Trustee's Rights Regarding the Mortgaged Property. At
any time or from time to time, without liability therefor and without notice,
upon written request of the Beneficiary, payment of its fees and presentation of
this Instrument without affecting the liability of any person for the payment of
the Secured Obligations, the Trustee may (a) consent to the making of any map or
plot of the Land, (b) join in granting any easement or creating any restriction
thereon, (c) join in any subordination or other agreement, affecting this
Instrument or the lien or charge thereof, or (d) reconvey or release from the
lien of this Instrument, without warranty, all or any part of the Mortgaged
Property.
Section 5.14. Time of Essence. Time is of the essence with respect
to the provisions of this Instrument.
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Section 5.15. Appointment of Successor Trustee. At the option of
the Beneficiary, with or without any reason, and from time to time, a successor
or substitute trustee may be appointed by the Beneficiary or any successor in
ownership of any indebtedness secured hereby, without any formality other than a
designation in writing of a successor or substitute trustee, who shall, without
conveyance from the Trustee predecessor, thereupon become vested with and
succeed to all the title, estate, powers and duties given to the Trustee herein
named, the same as if the successor or substitute trustee had been named
original Trustee herein; and such right to appoint a successor or substitute
trustee shall exist as often and whenever the Beneficiary desires. An
instrument, executed by the Beneficiary and duly acknowledged and recorded in
the office of the recorder of the county or counties where the Mortgaged
Property is situated, shall be conclusive proof of proper substitution of such
successor trustee or trustees. Said instrument should contain the name of the
original Trustor, Trustee and Beneficiary hereunder, the recording information
where this Instrument is recorded and the name and address of the new trustee.
Section 5.16. Additional Provision. Gen. Stat. Section 45-45.1 and
any similar statute enacted in replacement or substitution thereof shall be
inapplicable to this Instrument.
Section 5.17. Intent to Secure Obligations. Trustor intends by the
granting of this Instrument to secure to the fullest extent permitted by law the
payment and performance of all "Secured Obligations". The Intercreditor
Agreement defines "Issuer" to mean Marconi Corporation p.l.c. and any successor
thereto and defines "Guarantors" to include Trustor. The Indenture defines
"Obligor" to include Issuer and Trustor. The Intercreditor Agreement defines
"Secured Obligations" as follows:
"Secured Obligations" means all present and future
indebtedness, liabilities and obligations (for the avoidance of doubt, including
any liabilities and obligations which have been cash-collateralized by the
Obligors) at any time of any Obligor under the Relevant Documents, both actual
and contingent and whether incurred solely or jointly or in any other capacity
together with any of the following matters related to or arising in respect of
those liabilities and obligations: (1) any refinancing, novation, deferral or
extension; (2) any obligation relating to any increase in the amount of such
obligations; (3) any claim for damages or restitution; and (4) any claim as a
result of any recovery by an Obligor of a payment or discharge, or
non-allowability, on the grounds of preference; and any amounts that would be
included in any of the above but for any discharge, non-provability or
unenforceability of those amounts in any insolvency or other proceedings
(including interest accruing after the commencement of any insolvency or other
proceedings).
Section 5.18. Relevant Documents Revisions. In this Instrument,
references to this Instrument or to easement agreements, Leases, the
Intercreditor Agreement, and any other Relevant Documents include all
amendments, supplements, consolidations, replacements, restatements, extensions,
renewals and other modifications, to the extent applicable, and any refinancings
and refundings thereof, in whole or in part.
Section 5.19. WAIVER OF JURY TRIAL. TRUSTOR AND BENEFICIARY
EXPRESSLY AND VOLUNTARILY WAIVE ANY AND ALL RIGHTS, WHETHER ARISING UNDER THE
UNITED STATES OR ANY STATE CONSTITUTION, ANY RULES OF CIVIL PROCEDURE, COMMON
LAW OR OTHERWISE, TO DEMAND A TRIAL BY JURY IN ANY ACTION, LAWSUIT, PROCEEDING,
COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE BASED UPON, OR ARISING OUT OF,
THIS INSTRUMENT OR THE OTHER RELEVANT DOCUMENTS, ANY AGREEMENTS ARISING UNDER OR
RELATING TO THIS INSTRUMENT, ANY MORTGAGED PROPERTY SECURING THE SECURED
OBLIGATIONS, OR THE DEALINGS OR RELATIONSHIPS BETWEEN TRUSTOR AND BENEFICIARY.
NEITHER TRUSTOR NOR BENEFICIARY, INCLUDING ANY ASSIGNEE OR SUCCESSOR OF TRUSTOR
OR BENEFICIARY, SHALL SEEK A JURY TRIAL IN ANY SUCH ACTION. NEITHER TRUSTOR
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NOR BENEFICIARY SHALL SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION
WHEN A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THESE PROVISIONS SHALL BE
SUBJECT TO NO EXCEPTIONS. NEITHER TRUSTOR NOR BENEFICIARY HAS IN ANY WAY AGREED
WITH OR REPRESENTED TO THE OTHER THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT
BE FULLY ENFORCED IN ALL INSTANCES.
Section 5.20. Reduction of Secured Amount. In the event that the
maximum principal amount secured by this Instrument is less than the aggregate
Secured Obligations then the amount secured hereby shall be reduced only by the
last and final sums that the Trustor repays with respect to the Secured
Obligations and shall not be reduced by any intervening repayments of the
Secured Obligations. So long as the balance of the Secured Obligations exceeds
the amount secured hereby, any payments of the Secured Obligations shall not be
deemed to be applied against, or to reduce, the portion of the Secured
Obligations secured by this Instrument. Such payments shall instead be deemed to
reduce only such portions of the Secured Obligations as are secured by deeds of
trust or mortgages encumbering real property located outside the State of North
Carolina which secure the entire Secured Obligations (except to the extent, if
any, that specific deeds of trust or mortgages in such states contain specific
limitations on the amount secured).
Section 5.21. Board Resolution of Trustor. Attached hereto as
Exhibit C is a true and correct copy of the unanimous written consent of the
board of directors of Trustor approving this Instrument and authorizing the
person executing this Instrument to do so on behalf of Trustor.
17
IN WITNESS WHEREOF, this Instrument is executed as of the day
and year first above written by the person or persons identified below on behalf
of Trustor (and said person or persons hereby represent that they possess full
power and authority to execute this Instrument).
THE TRUSTOR HEREBY DECLARES AND ACKNOWLEDGES THAT THE TRUSTOR
HAS RECEIVED, WITHOUT CHARGE, A TRUE COPY OF THIS INSTRUMENT.
TRUSTOR:
MARCONI COMMUNICATIONS, INC.
a Delaware corporation
By: ________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: AUTHORIZED SIGNATORY
18
STATE OF ILLINOIS)
:
COUNTY OF DU PAGE )
I, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, certify that ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
personally came before me this day and acknowledged that she is an Authorized
Signatory of MARCONI COMMUNICATIONS, INC., a Delaware corporation, and that,
she, as a Authorized Signatory being duly authorized to do so, executed the
foregoing on behalf of the corporation.
Witness my hand and official seal, this 15TH day of May, 2003.
Notary Public ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
My commission expires: 5/19/03
[Notarial Seal/Stamp]
(OFFICIAL SEAL ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇)
19
EXHIBIT A
Davidson County, North Carolina
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Legal Description of the Premises
Lying and being in Davidson County, North Carolina, and being more particularly
described as follows:
Being all of Tract 5 as shown on the Plat of Welcome Business Center (Phase
Two), recorded in Plat Book 26, at Page 56 in the Davidson County Registry.
TOGETHER WITH the easement and other rights set forth in that certain
Declaration with Respect to Covenants and Restrictions Affecting the Welcome
Business Center recorded in Book 901, at Page 1290 as amended by an instrument
recorded in Book 982, at Page 1294 of the Davidson County Registry.
ALSO TOGETHER WITH the rights set forth in that certain Private Road Crossing
Agreement recorded in Book 665, at Page 95, re-recorded in Book 672, at Page
155, as amended by an instrument recorded in Book 683, at Page 412, and assigned
by instruments recorded Book 683, at Page 413 and in Book 901, at Page 1326, and
re-recorded in Book 902, at Page 291, all in the Davidson Country Public
Registry.
ALSO TOGETHER WITH, (i) all other rights and easements appurtenant to the
foregoing tract or any part thereof, (ii) all right, title and interest of the
record owner in, to and under the streets, rights-of-way and roads contiguous to
the foregoing tract or any part thereof, and (iii) all improvements, fixtures
and other property located on the foregoing tract.
A-1
EXHIBIT B
Permitted Title Exceptions
1. Taxes for the year 2003 and later years, not yet due and payable.
2. Covenants, Reservations, Easements and Restrictions appearing of record
in Book 901, Page 1290 and Book 982, Page 1294.
3. The following matter(s) affecting the land as shown on the plat
recorded in Plat Book 26, Page 56, Davidson County Registry:
a) 10 X 70 S.E. located at the south-western corner of
the land;
b) 20' Access & Utility Easement crossing the northern
portion of the land; and
c) 20' Permanent & 40' Temporary Sanitary Sewer Esm't
along the eastern property line of the land.
4. Private Road Crossing Agreement recorded in Book 665, Page 95, with a
Corrected Private Road Crossing Agreement recorded at Book 672, Page
155, amended by Amendment to Private Road Crossing Agreement recorded
in Book 683, Page 412 and as affected by those certain Assignments of
Interest recorded in Book 683, Page 413, Book 901, Page 1326 and
re-recorded in Book 902, Page 291.
5. Statement of Dedication of Streets recorded in Book 901, Page 1273,
Davidson County Registry.
6. Right-of-Way Easement recorded by Book 996, Page 1052, Davidson County
Registry.
7. Electric Powerline Easement recorded in Book 984, Page 133, Davidson
County Registry.
8. Deed of Trust in favor of NCNB National Bank recorded in Book 672, Page
157 in the Davidson County Registry.
9. Deed of Trust in favor of ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ recorded in Book 672, Page
159 in the Davidson County Registry.
10. UCC Financing Statement from Marconi Communications, Inc., as debtor,
to The Law Debenture Trust Corporation p.l.c., as security trustee, to
be filed in Davidson County.
B-1
EXHIBIT C
Board Resolution of Trustor
(See Attached)
C-1
ACTION BY THE BOARD OF DIRECTORS OF MARCONI COMMUNICATIONS, INC. BY
UNANIMOUS WRITTEN CONSENT WITHOUT A MEETING UNDER SECTION 141 (f) OF
THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE
The undersigned being all of the directors of Marconi Communications, Inc., a
Delaware corporation (the CORPORATION), unanimously consent in writing to the
adoption of the following resolutions. Capitalized terms used herein but not
defined herein have the meanings assigned to them in the Security Trust and
Intercreditor Deed.
1. US RESTRUCTURING
BACKGROUND:
(1) The Corporation, as an indirect, wholly-owned subsidiary of Marconi
Corporation plc (CORP) and Marconi plc (PLC) (each organized under the
laws of England and Wales), is involved in the restructuring of the
existing financial obligations of Corp and Plc. The restructuring is
designed to place Corp, Plc and their subsidiaries (together, the
MARCONI GROUP) in a more stable financial situation and provide for
their survival as going concerns.
(2) Corp is issuing guaranteed secured notes due 2008 (the NOTES) to its
creditors as part of the financial restructuring. As an absolute
precondition to the issuance of the Notes, the Corporation, as a
subsidiary of Corp, is required by the bank and bondholder committees
overseeing the reorganization to provide upstream guarantees of Corp's
liabilities under the Notes (the GUARANTEES) and a new L50 million
committed revolving bonding facility (the BONDING FACILITY). The
Corporation is required to provide security for its obligations under
the Guarantees and the Bonding Facility (the SECURITY).
(3) As a subsidiary of Corp and Plc, the Corporation will receive indirect
financial benefit from the issuance of the Notes, the provision of the
Guarantees and the Security and the successful completion of the
restructuring and survival of the Marconi Group.
(4) The board of directors of the Corporation has determined that it is in
the best interests of the Corporation to support the proposed
restructuring of the Marconi Group by issuing the Guarantees and the
Security and entering into the following agreements (the AGREEMENTS) as
part of the financial restructuring. Capitalized terms used in this
Section (4) shall have the meanings assigned to them in each respective
agreement. All of the Agreements will be entered into on or about the
date of the issuance of the Notes.
- Stock Pledge Agreement relating to shares in Marconi
Communications Technology, Inc., Marconi
Communications Federal, Inc., Marconi Acquisition,
Corp, Marconi Communications C.A., Inc., Gnome Inc.,
Nemesys Holding Company, ALANTEC International Inc.,
Custom Telecom Contractors, Inc., Marconi Networks
Worldwide, Inc., Gnome, Inc., Inviscid Networks,
Inc., Sphere Communications Inc. and Marconi
Intellectual Property (Ringfence) Inc., between the
Corporation as pledgor and the Security Trustee, as
pledgee;
- Memorandum of Deposit of Shares as Security to be
executed by the Corporation in respect of its
shareholding in Marconi Communications Optical
Networks Limited;
B-2
- Notarial Deed of Pledge of shares among the
Corporation, as pledgor, and Marconi Communications
B.V., as the company, and the Security Trustee as
pledgee;
- Memorandum of Deposit of Shares as Security to be
executed by the Corporation in respect of its
shareholding in RELTEC Mexico S.A. de C.V.;
- Indemnity Leasehold Deed to Secure Debt, Assignment
of Leases and Rents, Security Agreement, Financing
Statement and Fixture Filing over Property located at
▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ between the
Corporation and the Security Trustee dated as of the
15th day of May and effective as of the 19th of May,
2003, together with two UCC fixture filings relating
thereto;
- Leasehold Mortgage, Assignment of Leases and Rents,
Security Agreement, Financing Statement and Fixture
Filing over ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ between the Corporation and the
Security Trustee dated as of the 15th day of May and
effective as of the 19th of May, 2003, together with
two UCC fixture filings relating thereto;
- Deed of Trust Assignment of Leases, Security
Agreement, Financing Statement and Fixture Filing
over property located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ between the Corporation
and the Security dated as of the 15th day of May and
effective as of the 19th of May, 2003, together with
a UCC fixture filing relating thereto;
- Assignment of Rents related to the property located
at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ between the Corporation and the
Security Trustee dated as of the 15th day of May and
effective as of the 19th of May, 2003;
- Deed of Trust, Assignment of Leases and Rents,
Security Agreement, Financing Statement and Fixture
Filing over property located at Evergood, ▇▇ ▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
between the Corporation and the Security Trustee
dated dated as of the 15th day of May and effective
as of the 19th of May, 2003, together with a UCC
fixture filing relating thereto;
- Open-End Mortgage (Leasehold), Assignment of Leases
and Rents, Security Agreement, Financing Statement
and Fixture Filingover property located at ▇▇▇▇▇▇
▇▇▇▇▇ Industrial Park, Phase 3, North ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇ between the Corporation and the Security
Trustee dated as of the 15th day of May and effective
as of the 19th of May, 2003, together with a UCC
fixture filing relating thereto;
- Second Open-End Mortgage, Assignment of Leases and
Rents and Security Agreement over property located at
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
between the Corporation and the Security Trustee
dated as of the 15th day of May and effective as of
the 19th of May, 2003, together with a UCC fixture
filing relating thereto;
B-3
- Deed of Trust, Assignment of Leases, Security
Agreement, Financing Statement and Fixture Filing
over property located at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ between the Corporation and the
Security Trustee dated as of the 15th day of May and
effective as of the 19th of May, 2003, together with
a UCC fixture filing relating thereto;
- Assignment of Rents related to the property located
at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ between the
Corporation and the Security Trustee dated as of the
15th day of May and effective as of the 19th of May,
2003;
- written resolution oL the Corporation in its role as
the sole shareholder of Marconi Communications B.V.,
through which the Corporation approves the
resolutions of the board of managing directors of
Marconi Communications B.V. pursuant to the
requirements of Dutch law;
- Deposit Account Control Agreement between the
Corporation, as pledgor and the Security Trustee, as
pledgee and JPMorgan Chase, as Depository, through
which the Security Trustee's security interest in the
Corporation's various bank accounts will be
perfected;
- Deposit Account Control Agreement between the
Corporation, as pledgor and the Security Trustee, as
pledgee and JPMorgan Chase, as Depository, through
which the Security Trustee's security interest in the
Corporation's various bank accounts will be
perfected;
- Deposit Account Control Agreement among the
Corporation, as pledgor, and the Security Trustee, as
pledgee, and Federated Shareholder Services Company,
as Depository, through which the Security Trustee's
security interest in the Corporation's various bank
accounts will be perfected;
- Security agreement among the Corporation and other
Guarantors, as Pledgors and the Security Trustee, as
secured party, which will take a security interest in
and mortgage on, whether now owned or hereafter
acquired, and all proceeds and products thereof-all
personal property and fixture, including without
limitation all goods (including without limitation
inventory, equipment and any accessions thereto),
instruments (including without limitation promissory
notes), documents, accounts (including without
limitation health-care-insurance receivables),
chattel paper (whether tangible or electronic),
deposit accounts, letter-of-credit rights (whether or
not the letter of credit is evidenced by a writing),
money, tort claims, securities and all other
investment property, supporting obligations, any
other contract rights or rights to the payment of
money, insurance claims and proceeds, and all general
intangibles (including without limitation all
intellectual property, insurance policies and payment
intangibles);
- Senior Note Guarantee among the Corporation, the
parties listed therein as Guarantors, The Law
Debenture Trust Corporation Plc as security trustee,
the note trustee and each noteholder, pursuant to
which the Corporation and the Guarantors agree to
guarantee the punctual payment and performance when
due of all principal, premium, interest, penalties,
fees, indemnifications,
B-4
reimbursements, damages and other liabilities payable
by the Obligors under the Senior Notes and the Senior
Note Indenture;
- Junior Note Guarantee among the Corporation, the
parties listed therein as Guarantors, The Law
Debenture Trust Corporation Plc as security trustee,
the note trustee and each noteholder, pursuant to
which the Corporation and the Guarantors agree to
guarantee the punctual payment and performance when
due of all principal, premium, interest, penalties,
fees, indemnifications, reimbursements, damages and
other liabilities payable by the Obligors under the
Junior Notes and the Junior Note Indenture;
- Composite Guarantee among the Corporation, the
parties listed therein as Guarantors and The Law
Debenture Trust Corporation Plc as security trustee;
pursuant to which the Corporation and the Guarantors
agree to guarantee the punctual payment and
performance when due of all principal, premium,
interest, penalties, fees, indemnifications,
reimbursements, damages and other liabilities payable
by the Obligors under the Guaranteed Documents;
- Security Trust and Intercreditor Deed among, amongst
others, the Corporation, Corp as issuer, the parties
listed therein as Guarantors, The Law Debenture Trust
Corporation p.l.c. as security trustee, Law Debenture
Trust Company of New York as senior note trustee,
JPMorgan Chase Bank as junior note trustee, HSBC Bank
plc as new bonding facility agent, The Bank of New
York as depository, principal paying agent and
registrar and certain intra-group creditors and
borrowers;
- Senior Note Indenture among the Corporation, the
parties listed therein as Guarantors, Plc as issuer
and The Law Debenture Trust Corporation Plc as
trustee, pursuant to which Plc issues its Guaranteed
Senior Secured Notes and the Guarantors agree to
guarantee the punctual payment and performance when
due of all principal, premium, interest, penalties,
fees, indemnifications, reimbursements, damages and
other liabilities payable by the Obligors under the
Senior Notes and the Senior Note Indenture;
- Junior Note Indenture among the Corporation, the
parties listed therein as Guarantors, Plc as issuer
and The Law Debenture Trust Corporation Plc as
trustee, pursuant to which Plc issues its Guaranteed
Junior Secured Notes and the Guarantors agree to
guarantee the punctual payment and performance when
due of all principal, premium, interest, penalties,
fees, indemnifications, reimbursements, damages and
other liabilities payable by the Obligors under the
Junior Notes and the Junior Note Indenture;
- Agency Agreement among The Bank of New York (the
trustee for the Senior Notes and the Junior Notes),
the Corporation, each of the other Guarantors and
Corp, pursuant to which they appoint The Bank of New
York as the Paying Agent and Registrar with respect
to the Senior Notes and the Junior Notes, in
connection with the execution and delivery of the
Senior Note Indenture and the Junior Note Indenture;
B-5
- Patent Assignment Agreement among the Corporation,
Marconi Intellectual Property (Ringfence) Inc. (the
ASSIGNEE), ALANTEC International, Inc. (an ASSIGNOR),
Marconi Communications Technology, Inc. (also an
Assignor, and together with the Corporation and
ALANTEC International, Inc., the Assignors), pursuant
to which the Assignors will assign all of their
rights, title and interest in certain intellectual
property to the Assignee;
- Patent Assignment Agreement among the Corporation and
Marconi Intellectual Property (US), Inc. (the
ASSIGNEE), pursuant to which the Corporation will
assign all of its rights, title and interest in
certain intellectual property to the Assignee;
- Patent License Agreement among the Corporation, Corp
(also a LICENSEE, and together with the Corporation,
Licensees) and Marconi Intellectual Property
(Ringfence) Inc. (the LICENSOR), pursuant to which
the Licensor will license certain intellectual
property and delegate day-to-day management of
certain intellectual property to the Licensees;
- Group License Agreement among the Corporation and
other members of the Marconi Group, under which the
Corporation grants certain rights to the other
companies in the Marconi Group to use certain
intellectual property rights owned by the
Corporation;
- Deed of Variation among the Corporation, Marconi
Communications Limited, Marconi Communications S.p.A.
and Marconi Communications GmbH, pursuant to which
the parties thereto amend the research and
development cost sharing agreement under which they
agreed to share the costs and risks of research and
development services or activities in return for
certain licences to exploit technology that would be
produced by such services or activities; and
- Subordination and Intercreditor Agreement among
Liberty Funding, L.L.C. (as SENIOR LENDER), The Law
Debenture Trust Corporation p.l.c. as Security
Trustee and the Corporation, relating to the Loan
Agreement between the Senior Lender and the
Corporation.
(5) Each of the directors has reviewed the current drafts of the
Agreements.
IT IS THEREFORE:
RESOLVED, that the Agreements, the execution, delivery and performance of the
Agreements by the Corporation and each transaction effected or to be effected
pursuant to the terms and conditions of the Agreements be, and hereby are,
authorized and approved, and that ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and
▇▇▇▇▇ ▇▇▇▇▇ (collectively, the AUTHORIZED SIGNATORIES) be, and each hereby is,
acting individually, authorized and empowered on behalf and in the name of the
Corporation, to negotiate, execute, deliver and perform the Agreements
substantially in the form of the drafts of the Agreements presented to the
directors, with such changes as any Authorized Signatory shall approve, and that
any Authorized Signatory's execution or signing, on the Corporation's behalf, of
the Agreements shall be conclusive evidence of his or her approval of the
Agreements in the form so executed or signed and of any changes they contain and
of the authorization and ratification by this board of directors of the
Agreements in the forms so executed or signed, and that any and all prior acts
done or purported to be done by any Authorized Signatory in
B-6
connection with the Agreements or the transactions contemplated therein are
hereby ratified and confirmed.
RESOLVED, that references to Miranda Communications, Inc. in the resolutions
duly adopted by the board of directors of the Corporation by unanimous written
consent dated March 24, 2003 (the MARCH RESOLUTIONS) (attached as Schedule 1)
shall be read as Marconi Communications, Inc., and that the term Miranda in the
March Resolutions shall be read as Marconi.
RESOLVED, that the Authorized Signatories, in order to carry out and effectuate
the full purposes of the foregoing resolution, be, and each hereby is, acting
individually, authorized to take all such further actions, execute or sign such
additional agreements, certificates, instruments and documents in such form as
the Authorized Signatory executing the same shall approve, and to pay all such
fees and expenses as any Authorized Signatory, acting individually, may deem
necessary or desirable, and that any Authorized Signatory's execution or
signing, on the Corporation's behalf, of any such agreement, certificate,
instrument or other document shall be conclusive evidence of his or her approval
and of its authorization and ratification by this board of directors.
2. US RINGFENCING
BACKGROUND:
(1) An approval paper for the US Ringfencing has been presented to and
considered by the board of directors of the Corporation. The US
Ringfencing is a component of the restructuring of Plc and Corp. The
overall purpose and effect of the US Ringfencing is to contractually
separate or "ringfence" the US Core Businesses (i.e. the BBRS Buisness,
the North American Access Business and the Outside Plant and Power
Business) which are held in subsidiaries of the Corporation from the
rest of the Marconi Group.
(2) The following documents have been presented to and considered by the
board of directors of the Corporation:
(a) a draft Relationship Agreement to be entered into between Corp
and the Corporation (the RELATIONSHIP AGREEMENT) that deals
with services and cost allocations that cross the "ringfence";
(b) various draft Confirmations (the CONFIRMATIONS) as set out in
Schedule 1 to be entered into by the Corporation pursuant to
the Relationship Agreement; and
(c) a draft Inter Company Terms and Conditions for the sale of
equipment and software supply and support services across the
"ringfence" (the INTER COMPANY TS&CS) to be entered into by
the Corporation.
The Relationship Agreement, the Confirmations and the Inter Company ts&cs seek
to ensure that services and cost allocations that cross the "ringfence"
are provided and apportioned on an arm's length basis so as to comply
with the terms of the Notes.
(3) Accordingly, the board of directors of the Corporation has determined
that it is in the best interests of the Corporation to enter into the
Relationship Agreement, the Confirmation and the Inter Company ts&cs
(the Documents) and to carry out the transactions set forth therein.
B-7
(4) Each of the directors has reviewed the current drafts of the Documents.
IT IS THEREFORE:
RESOLVED, that the Documents, the execution, delivery and performance
of the Documents by the Corporation and each transaction effected or to be
effected pursuant to the terms and conditions of the Documents be, and hereby
are, authorized and approved, and that ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇ (collectively, the US
RINGFENCING AUTHORIZED SIGNATORIES) be, and each hereby is, acting individually,
authorized and empowered on behalf and in the name of the Corporation, to
negotiate, execute, deliver and perform the Documents substantially in the form
of the drafts of the Documents presented to the directors, with such changes as
any US Ringfencing Authorized Signatory shall approve, and that any US
Ringfencing Authorized Signatory's execution or signing, on the Corporation's
behalf, of the Documents shall be conclusive evidence of his or her approval of
the Documents in the form so executed or signed and of any changes they contain
and of the authorization and ratification by this board of directors of the
Documents in the forms so executed or signed, and that any and all prior acts
done or purported to be done by any US Ringfencing Authorized Signatory in
connection with the Documents or the transactions contemplated therein are
hereby ratified and confirmed.
RESOLVED, that the US Ringfencing Authorized Signatories, in order to carry out
and effectuate the full purposes of the foregoing resolution, be, and each
hereby is, acting individually, authorized to take all such further actions,
execute or sign such additional agreements, certificates, instruments and
documents in such form as the US Ringfencing Authorized Signatory executing the
same shall approve, and to pay all such fees and expenses as any US Ringfencing
Authorized Signatory, acting individually, may deem necessary or desirable, and
that any US Ringfencing Authorized Signatory's execution or signing, on the
Corporation's behalf, of any such agreement, certificate, instrument or other
document shall be conclusive evidence of his or her approval and of its
authorization and ratification by this board of directors.
RESOLVED, that the Secretary of the Corporation is hereby authorized to certify
to the names of the current officers of this Corporation and other persons
authorized to sign for it (including, without limitation, persons to whom such
officers or authorized persons have delegated their authority) and the offices
respectively held by them, if any, together with specimens of their signatures,
and in case of any change of a holder of an office or of an authorized person,
the fact of such change and the name of the new officer or authorized person,
and the office held by such person, together with a specimen of such person's
signature; and each of the Senior Note Trustee and the Junior Note Trustee be,
and each of them is, authorized to honor any notices, agreements or other
documents signed by a person in respect of whom it has received any such
certificate.
RESOLVED, that the secretary of the Corporation is directed to file this consent
and these resolutions in the minute book of the Corporation.
This consent may be executed in one or more counterparts, all of which taken
together, shall constitute a single executed original.
Dated as of May 15, 2003.
___________________________GLENN ▇. ▇▇▇▇▇▇
___________________________PATRICIA ▇. ▇▇▇▇▇▇▇
B-8
SCHEDULE 1
1. Confirmation between the Company as Service Provider and Receiving
Entity and Marconi Inc, as Service Provider and Receiving Entity.
2. Confirmation between the Company as Service Provider and Receiving
Entity and Greensboro Associates Inc. as Service Provider and Receiving
Entity.
3. Confirmation between the Company as Service Provider and Receiving
Entity and Metapath Software International Inc. as Service Provider and
Receiving Entity.
4. Confirmation between the Company as Service Provider and Marconi
Acquistion Corporation as Receiving Entity.
5. Confirmation between the Company as Service Provider and Regents Place
Inc. as Receiving Entity.
6. Confirmation between the Company as Service Provider and Systems
Management Specialists, Inc. as Receiving Entity.
B-9