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SECURITY AGREEMENT
among
TRANSWORLD HOME HEALTHCARE, INC.,
VARIOUS SUBSIDIARIES,
and
BANKERS TRUST COMPANY,
as Collateral Agent
Dated as of July 31, 1996
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TABLE OF CONTENTS
Page
ARTICLE I SECURITY INTERESTS.......................................... 3
1.1. Grant of Security Interests................................. 3
1.2. Power of Attorney........................................... 4
ARTICLE II GENERAL REPRESENTATIONS, WARRANTIES AND
COVENANTS.................................................. 5
2.1. Necessary Filings........................................... 5
2.2. No Liens.................................................... 5
2.3. Other Financing Statements.................................. 5
2.4. Chief Executive Office; Records............................. 6
2.5. Location of Inventory and Equipment......................... 6
2.6. Recourse.................................................... 7
2.7. Trade Names; Change of Name................................. 7
ARTICLE III SPECIAL PROVISIONS CONCERNING
RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS.................. 8
3.1. Additional Representations and Warranties................... 8
3.2. Maintenance of Records...................................... 8
3.3. Direction to Account Debtors; Contracting Parties; etc...... 9
3.4. Modification of Terms; etc.................................. 9
3.5. Collection.................................................. 10
3.6. Instruments................................................. 10
3.7 Further Actions............................................. 10
3.8 Paribas Indemnity........................................... 11
ARTICLE IV SPECIAL PROVISIONS CONCERNING TRADEMARKS.................... 11
4.1. Additional Representations and Warranties................... 11
4.2. Licenses and Assignments.................................... 12
4.3. Infringements............................................... 12
4.4. Preservation of Marks....................................... 12
4.5. Maintenance of Registration................................. 12
4.6. Future Registered Marks..................................... 13
4.7. Remedies.................................................... 13
(i)
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Page
ARTICLE V SPECIAL PROVISIONS CONCERNING
PATENTS, COPYRIGHTS AND TRADE SECRETS................. 14
5.1. Additional Representations and Warranties................... 14
5.2. Licenses and Assignments.................................... 15
5.3. Infringements............................................... 15
5.4. Maintenance of Patents and Copyrights....................... 15
5.5. Prosecution of Patent or Copyright Application.............. 15
5.6. Other Patents and Copyrights................................ 15
5.7. Remedies.................................................... 16
ARTICLE VI PROVISIONS CONCERNING ALL COLLATERAL........................ 16
6.1. Protection of Collateral Agent's Security................... 16
6.2. Warehouse Receipts Non-negotiable........................... 17
6.3. Further Actions............................................. 17
6.4. Financing Statements........................................ 17
ARTICLE VII REMEDIES UPON OCCURRENCE OF EVENT OF
DEFAULT............................................... 18
7.1. Remedies; Obtaining the Collateral Upon Default............. 18
7.2. Remedies; Disposition of the Collateral..................... 19
7.3. Waiver of Claims............................................ 20
7.4. Application of Proceeds..................................... 21
7.5. Remedies Cumulative......................................... 23
7.6. Discontinuance of Proceedings............................... 24
ARTICLE VIII INDEMNITY................................................... 24
8.1. Indemnity................................................... 24
8.2. Indemnity Obligations Secured by Collateral; Survival....... 26
ARTICLE IX DEFINITIONS................................................. 26
ARTICLE X MISCELLANEOUS............................................... 32
10.1. Notices..................................................... 32
10.2. Waiver; Amendment........................................... 32
10.3. Obligations Absolute........................................ 33
10.4. Successors and Assigns...................................... 33
10.5. Headings Descriptive........................................ 34
10.6. Governing Law............................................... 34
10.7. Assignor's Duties........................................... 34
10.8. Termination; Release........................................ 34
(ii)
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10.9. Counterparts................................................ 35
10.10. The Collateral Agent........................................ 35
10.11. Severability................................................ 36
10.12. Limited Obligations......................................... 36
10.13. Additional Assignors........................................ 36
ANNEX A Schedule of Chief Executive Offices/Record Locations
ANNEX B Schedule of Inventory and Equipment Locations
ANNEX C Schedule of Trade, Fictitious and Other Names
ANNEX D Schedule of Marks
ANNEX E Schedule of Patents and Applications
ANNEX F Schedule of Copyrights and Applications
ANNEX G Assignment of Security Interest in Patents and Trademarks
ANNEX H Assignment of Security Interest in Copyrights
(iii)
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SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of July 31, 1996 (as amended,
modified or supplemented from time to time, the "Agreement"), among each of the
undersigned (each, an "Assignor" and, collectively, the "Assignors") and BANKERS
TRUST COMPANY, as Collateral Agent (the "Collateral Agent"), for the benefit of
the Secured Creditors (as defined below). Except as otherwise defined herein,
terms used herein and defined in the Credit Agreement (as defined below) shall
be used herein as therein defined.
W I T N E S S E T H :
WHEREAS, Transworld Home HealthCare, Inc. (the "Borrower"),
various financial institutions from time to time party thereto (the "Banks") and
Bankers Trust Company, as Agent (the "Agent", and together with the Banks and
the Collateral Agent, the "Bank Creditors"), have entered into a Credit
Agreement, dated as of July 31, 1996, providing for the making of Loans to the
Borrower and the issuance of, and participation in, Letters of Credit for the
account of the Borrower as contemplated therein (as used herein, the term
"Credit Agreement" means the Credit Agreement described above in this paragraph
as so amended, modified, extended, renewed, replaced, restated, supplemented,
restructured or refinanced from time to time, and including any agreement
extending the maturity of, refinancing or restructuring (including, but not
limited to, the inclusion of additional borrowers thereunder that are
Subsidiaries of the Borrower and whose obligations are guaranteed by the
Borrower thereunder or any increase in the amount borrowed) all, or any portion
of, the Indebtedness under such agreement or any successor agreements; provided,
that with respect to any agreement providing for the refinancing of Indebtedness
under the Credit Agreement, such agreement shall only be treated as, or as part
of, the Credit Agreement hereunder if (i) either (A) all obligations under the
Credit Agreement being refinanced shall be paid in full at the time of such
refinancing, and all commitments under the refinanced Credit Agreement shall
have terminated in accordance with their terms or (B) the Required Banks shall
have consented in writing to the refinancing Indebtedness being treated, along
with their Indebtedness, as Indebtedness pursuant to the Credit Agreement, (ii)
the refinancing Indebtedness shall be permitted to be incurred under the Credit
Agreement being refinanced (if such Credit Agreement is to remain outstanding)
and (iii) a notice to the effect that the refinancing Indebtedness shall be
treated as issued under the Credit Agreement shall be delivered by the Borrower
to the Collateral Agent);
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WHEREAS, the Borrower may from time to time enter into one or
more (i) interest rate protection agreements (including, without limitation,
interest rate swaps, caps, floors, collars and similar agreements), (ii) foreign
exchange contracts, currency swap agreements or other similar agreements or
arrangements designed to protect against the fluctuations in currency values
and/or (iii) other types of hedging agreements from time to time (each such
agreement or arrangement with an Other Creditor (as hereinafter defined), an
"Interest Rate Protection Agreement or Other Hedging Agreement"), with Bankers
Trust Company in its individual capacity ("BTCo"), any Bank or a syndicate of
financial institutions organized by BTCo or any such Bank, or an affiliate of
BTCo or any such Bank (BTCo, any such Bank or Banks or affiliate or affiliates
of BTCo or such Bank or Banks (even if BTCo or any such Bank ceases to be a Bank
under the Credit Agreement for any reason) and any such institution that
participates in such Interest Rate Protection Agreements or Other Hedging
Agreements and their subsequent successors and assigns collectively, the "Other
Creditors", and together with the Bank Creditors, the "Secured Creditors");
WHEREAS, pursuant to the Subsidiaries Guaranty, each
Subsidiary Guarantor will have, after the execution and delivery thereof,
jointly and severally guaranteed the payment when due of all obligations and
liabilities of the Borrower under or with respect to the Credit Documents and
each Interest Rate Protection Agreement or Other Hedging Agreement with one or
more Other Creditors;
WHEREAS, it is a condition precedent to the making of Loans to
the Borrower and the issuance of, and participation in, Letters of Credit for
the account of the Borrower under the Credit Agreement and to the Other
Creditors entering into Interest Rate Protection Agreements or Other Hedging
Agreements that each Assignor shall have executed and delivered to the
Collateral Agent this Agreement; and
WHEREAS, each Assignor desires to execute this Agreement to
satisfy the condition described in the preceding paragraph;
NOW, THEREFORE, in consideration of the benefits accruing to
each Assignor, the receipt and sufficiency of which are hereby acknowledged,
each Assignor hereby makes the following representations and warranties to the
Collateral Agent and hereby covenants and agrees with the Collateral Agent as
follows:
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ARTICLE I
SECURITY INTERESTS
1.1. Grant of Security Interests. (a) As security for the
prompt and complete payment and performance when due of all of the Obligations,
each Assignor does hereby assign and transfer unto the Collateral Agent, and
does hereby pledge and grant to the Collateral Agent for the benefit of the
Secured Creditors, a continuing security interest of first priority in, all of
the right, title and interest of such Assignor in, to and under all of the
following, whether now existing or hereafter from time to time acquired:
(i) each and every Receivable;
(ii) all Contracts, together with all Contract Rights arising
thereunder;
(iii) all Inventory;
(iv) the Cash Collateral Account and any other cash collateral
account established for any Assignor and all moneys, securities and
instruments deposited or required to be deposited in such Cash
Collateral Account;
(v) all Equipment;
(vi) all Marks, together with the registrations and right to
all renewals thereof, and the goodwill of the business of such Assignor
symbolized by the Marks;
(vii) all Patents and Copyrights and all reissues, renewals
and extensions thereof;
(viii) all computer programs of such Assignor and all
intellectual property rights therein and all other proprietary
information of such Assignor, including, but not limited to, trade
secrets and Trade Secret Rights;
(ix) all insurance policies;
(x) all other Goods, General Intangibles, Chattel Paper,
Documents and Instruments and other assets of such Assignor (other than
the Pledged Securities); and
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(xi) all Proceeds and products of any and all of the foregoing
(all of the above, collectively, the "Collateral").
(b) Notwithstanding anything else in this Agreement to the
contrary, each Secured Creditor (by its acceptance of the benefits provided
hereunder) agrees with each Assignor that no Secured Creditor is purchasing or
acquiring hereunder any Receivable but only taking a security interest therein,
provided, however, this Agreement shall not restrict the Collateral Agent's
ability to exercise its rights hereunder to the extent permitted by law.
Notwithstanding Section 1.1(a), to the extent that any Contract may be
terminated or a default shall be caused thereunder (in accordance with the terms
thereof after giving effect to any applicable laws) in the event of a granting
of a security interest therein, or in the event the granting of a security
interest in any Contract shall violate applicable law, then the security
interest granted hereby shall be limited to the extent necessary so that such
Contract may not be so terminated or no such violation shall exist, as the case
may be, and all rights for money due or to become due under each such Contract
and other proceeds shall be subject to the security interest.
(c) The security interest of the Collateral Agent under this
Agreement extends to all Collateral of the kind which is the subject of this
Agreement which any Assignor may acquire at any time during the continuation of
this Agreement.
1.2. Power of Attorney. Each Assignor hereby constitutes and
appoints the Collateral Agent its true and lawful attorney, irrevocably, with
full power after the occurrence of and during the continuance of an Event of
Default (in the name of such Assignor or otherwise) to act, require, demand,
receive, compound and give acquittance for any and all monies and claims for
monies due or to become due to such Assignor under or arising out of the
Collateral, to endorse any checks or other instruments or orders in connection
therewith and to file any claims or take any action or institute any proceedings
which the Collateral Agent may deem to be necessary or advisable to accomplish
the purposes of this Agreement, which appointment as attorney is coupled with an
interest.
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ARTICLE II
GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS
Each Assignor represents, warrants and covenants, which
representations, warranties and covenants shall survive execution and delivery
of this Agreement, as follows:
2.1. Necessary Filings. All filings, registrations and
recordings necessary or appropriate to create, preserve, protect and perfect the
security interest granted by such Assignor to the Collateral Agent hereby in
respect of the Collateral (other than any steps necessary to comply with the
Federal Assignment of Claims Act of 1940 unless and until such steps are or have
been requested by the Agent or the Required Banks pursuant to Section 3.8) have
been accomplished or will be accomplished within five days of the date hereof
and the security interest granted to the Collateral Agent pursuant to this
Agreement in and to the Collateral constitutes a perfected security interest
therein prior to the rights of all other Persons therein and subject to no other
Liens (other than Permitted Liens) and is entitled to all the rights, priorities
and benefits afforded by the Uniform Commercial Code or other relevant law as
enacted in any relevant jurisdiction to perfected security interests.
2.2. No Liens. Such Assignor is, and as to Collateral acquired
by it from time to time after the date hereof such Assignor will be, the owner
of all Collateral free from any Lien, security interest, encumbrance or other
right, title or interest of any Person (other than Permitted Liens and Liens
created under this Agreement) and such Assignor shall defend the Collateral
against all claims and demands of all Persons at any time claiming the same or
any interest therein adverse to the Collateral Agent.
2.3. Other Financing Statements. As of the date hereof, there
is no financing statement (or similar statement or instrument of registration
under the law of any jurisdiction) covering or purporting to cover any interest
of any kind in the Collateral (other than (x) those created under this Agreement
and (y) as may be filed in connection with Liens permitted pursuant to Section
9.03 of the Credit Agreement), and so long as the Total Commitment has not been
terminated or any Note or Letter of Credit remains outstanding or any of the
Obligations remain unpaid or any Interest Rate Protection Agreement or Other
Hedging Agreement remains in effect or any Obligations are owed with respect
thereto, such Assignor will not execute or authorize to be filed in any public
office any financing statement (or similar statement or instrument of
registration under the law of any jurisdiction) or statements relating to the
Collateral, except financing statements filed or to be filed in respect of and
covering the security interests granted hereby by such Assignor or as permitted
by the Credit Agreement.
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2.4. Chief Executive Office; Records. The chief executive
office of such Assignor is located at the address or addresses indicated on
Annex A hereto. Such Assignor will not move its chief executive office except to
such new location as such Assignor may establish in accordance with the last
sentence of this Section 2.4. The originals of all documents evidencing all
Receivables and Contract Rights and Trade Secret Rights of such Assignor and the
only original books of account and records of such As ▇▇▇▇▇▇ relating thereto
are, and will continue to be, kept at such chief executive office or at such new
locations as such Assignor may establish in accordance with the last sentence of
this Section 2.4. All Receivables and Contract Rights and Trade Secret Rights of
such Assignor are, and will continue to be, maintained at, and controlled and
directed (including, without limitation, for general accounting purposes) from,
the office locations described above or such new location established in
accordance with the last sentence of this Section 2.4. No Assignor shall
establish new locations for such offices until (i) it shall have given to the
Collateral Agent not less than 30 days' prior written notice of its intention to
do so, clearly describing such new location and providing such other information
in connection therewith as the Collateral Agent may reasonably request, (ii)
with respect to such new location, it shall have taken all action, satisfactory
to the Collateral Agent, to maintain the security interest of the Collateral
Agent in the Collateral intended to be granted hereby at all times fully
perfected and in full force and effect, (iii) at the request of the Collateral
Agent, it shall have furnished an opinion of counsel acceptable to the
Collateral Agent to the effect that all financing or continuation statements and
amendments or supplements thereto have been filed in the appropriate filing
office or offices, and (iv) the Collateral Agent shall have received evidence
that all other actions (including, without limitation, the payment of all filing
fees and taxes, if any, payable in connection with such filings) have been
taken, in order to perfect (and maintain the perfection and priority of) the
security interest granted hereby.
2.5. Location of Inventory and Equipment. All Inventory and
Equipment held on the date hereof by each Assignor is located at one of the
locations shown on Annex B hereto. Each Assignor agrees that all Inventory and
Equipment now held or subsequently acquired by it shall be kept at (or shall be
in transport to) any one of the locations shown on Annex B hereto, or such new
location as such Assignor may establish in accordance with the last sentence of
this Section 2.5, except as permitted to be sold in accordance with the terms
hereof and in the Credit Agreement, provided that equipment held by an Assignor
may be repaired or rented to customers, in either case (x) in the ordinary
course of business and (y) so long as proper financing statements and any other
necessary filings exist for such Assignor in the location of such equipment such
that the Collateral Agent retains the perfected security interest granted
hereby. Any Assignor may establish a new location for Inventory and Equipment
only if (i) it shall have given to the Collateral Agent not less than 30 days
prior written notice of its intention so to do, clearly describing such new
location and providing
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such other information in connection therewith as the Collateral Agent may
reasonably request, (ii) with respect to such new location, it shall have taken
all action satisfactory to the Collateral Agent to maintain the security
interest of the Collateral Agent in the Collateral intended to be granted hereby
at all times fully perfected and in full force and effect, (iii) at the request
of the Collateral Agent, it shall have furnished an opinion of counsel
acceptable to the Collateral Agent to the effect that all financing or
continuation statements and amendments or supplements thereto have been filed in
the appropriate filing office or offices, and (iv) the Collateral Agent shall
have received evidence that all other actions (including, without limitation,
the payment of all filing fees and taxes, if any, payable in connection with
such filings) have been taken, in order to perfect (and maintain the perfection
and priority of) the security interest granted hereby.
2.6. Recourse. This Agreement is made with full recourse to
each Assignor and pursuant to and upon all the warranties, representations,
covenants and agreements on the part of such Assignor contained herein, in the
other Credit Documents, in the Interest Rate Protection Agreements or Other
Hedging Agreements and otherwise in writing in connection herewith or therewith.
2.7. Trade Names; Change of Name. No Assignor has or operates in any
jurisdiction under, or previously has had or has operated in any jurisdiction
within the five year period preceding the date of this Agreement under, any
trade names, fictitious names or other names except its legal name and such
other trade or fictitious names as are listed on Annex C hereto. No Assignor
shall change its legal name or assume or operate in any jurisdiction under any
trade, fictitious or other name except those names listed on Annex C hereto in
the jurisdictions listed with respect to such names and new names (including,
without limitation, any names of divisions or operations) and/or jurisdictions
established in accordance with the last sentence of this Section 2.7. No
Assignor shall assume or operate in any jurisdiction under any new trade,
fictitious or other name or operate under any existing name in any additional
jurisdiction until (i) it shall have given to the Collateral Agent not less than
30 days' prior written notice of its intention so to do, clearly describing such
new name and/or jurisdiction and, in the case of a new name, the jurisdictions
in which such new name shall be used and providing such other information in
connection therewith as the Collateral Agent may reasonably request, (ii) with
respect to such new name and/or jurisdiction, it shall have taken all action to
maintain the security interest of the Collateral Agent in the Collateral
intended to be granted hereby at all times fully perfected and in full force and
effect, (iii) at the request of the Collateral Agent, it shall have furnished an
opinion of counsel acceptable to the Collateral Agent to the effect that all
financing or continuation statements and amendments or supplements thereto have
been filed in the appropriate filing office or offices, and (iv) the Collateral
Agent shall have received evidence that all other actions
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(including, without limitation, the payment of all filing fees and taxes, if
any, payable in connection with such filings) have been taken, in order to
perfect (and maintain the perfection and priority of) the security interest
granted hereby.
ARTICLE III
SPECIAL PROVISIONS CONCERNING
RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS
3.1. Additional Representations and Warranties. As of the time
when each of its Receivables arises, each Assignor shall be deemed to have
represented and warranted that such Receivable, and all records, papers and
documents relating thereto (if any) are genuine and in all respects what they
purport to be, and that all papers and documents (if any) relating thereto (i)
will represent the genuine legal, valid and binding obligation of the account
debtor evidencing indebtedness unpaid and owed by the respective account debtor
arising out of the performance of labor or services or the sale or lease and
delivery of the inventory, materials, equipment or merchandise listed therein,
or both, (ii) will be the only original writings evidencing and embodying such
obligation of the account debtor named therein (other than copies created for
general accounting purposes), (iii) will evidence true and valid obligations,
enforceable in accordance with their respective terms subject to credits,
discounts or allowances consistent with historical practice and as otherwise
permitted by Section 3.5 hereof and (iv) will be in compliance and will conform
in all material respects with all applicable federal, state and local laws and
applicable laws of any relevant foreign jurisdiction.
3.2. Maintenance of Records. Each Assignor will keep and
maintain at its own cost and expense satisfactory and complete records of its
Receivables and Contracts, including, but not limited to, originals or copies of
all documentation (including each Contract) with respect thereto, records of all
payments received, all credits granted thereon, all merchandise returned and all
other dealings therewith, and such Assignor will make the same available on such
Assignor's premises to the Collateral Agent for inspection, at such Assignor's
own cost and expense, at any and all reasonable times and intervals during
normal business hours on reasonable prior notice as the Collateral Agent may
request. Upon the occurrence and during the continuance of an Event of Default
and at the request of the Collateral Agent, such Assignor shall, at its own cost
and expense, deliver all tangible evidence of its Receivables and Contract
Rights (including, without limitation, all documents evidencing the Receivables
and all Contracts) and such books and records to the Collateral Agent or to its
representatives (copies of which evidence and books and records may be
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retained by such Assignor). If the Collateral Agent so directs, such Assignor
shall legend, in form and manner satisfactory to the Collateral Agent, the
Receivables and the Contracts, as well as books, records and documents of such
Assignor evidencing or pertaining to such Receivables and Contracts with an
appropriate reference to the fact that such Receivables and Contracts have been
assigned to the Collateral Agent and that the Collateral Agent has a security
interest therein.
3.3. Direction to Account Debtors; Contracting Parties; etc.
Upon the occurrence and during the continuance of an Event of Default, and if
the Collateral Agent so directs any Assignor, to the extent permitted by
applicable law, such Assignor agrees (x) to cause all payments on account of the
Receivables and Contracts to be made directly to the Cash Collateral Account,
(y) that the Collateral Agent may, at its option, directly notify the obligors
with respect to any Receivables and/or under any Contracts to make payments with
respect thereto as provided in preceding clause (x), and (z) that the Collateral
Agent may enforce collection of any such Receivables and Contracts and may
adjust, settle or compromise the amount of payment thereof, in the same manner
and to the same extent as such Assignor. Without notice to or assent by any
Assignor, the Collateral Agent may apply any or all amounts then in, or
thereafter deposited in, the Cash Collateral Account which application shall be
effected in the manner provided in Section 7.4 of this Agreement. The costs and
expenses (including attorneys' fees) of collection, whether incurred by the
Assignor or the Collateral Agent, shall be borne by the relevant Assignor.
3.4. Modification of Terms; etc. No Assignor shall rescind or
cancel any indebtedness evidenced by any Receivable or under any Contract, or
modify any term thereof or make any adjustment with respect thereto, or extend
or renew the same, or compromise or settle any material dispute, claim, suit or
legal proceeding relating thereto, or sell any Receivable or Contract, or
interest therein, without the prior written consent of the Collateral Agent,
except as permitted by Section 3.5 or in a manner that does not in any way
materially adversely affect the interests of the Banks. Each Assignor will duly
fulfill all obligations on its part to be fulfilled under or in connection with
the Receivables and Contracts and will do nothing to impair the rights of the
Collateral Agent in the Receivables or Contracts.
3.5. Collection. Each Assignor shall endeavor to cause to be
collected from the account debtor named in each of its Receivables or obligor
under any Contract, as and when due (including, without limitation, amounts,
services or products which are delinquent, such amounts, services or products to
be collected in accordance with generally accepted lawful collection procedures)
any and all amounts, services or products owing under or on account of such
Receivable or Contract, and apply forthwith upon receipt thereof all such
amounts, services or products as are so collected to the outstanding balance of
such
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Receivable or under such Contract, except that, prior to the occurrence of an
Event of Default, any Assignor may allow in the ordinary course of business as
adjustments to amounts, services or products owing under its Receivables and
Contracts (i) an extension or renewal of the time or times of payment or
exchange, or settlement for less than the total unpaid balance, which such
Assignor finds appropriate in accordance with reasonable business judgment and
(ii) a refund or credit due as a result of returned or damaged merchandise or
improperly performed services. The costs and expenses (including, without
limitation, attorneys' fees) of collection, whether incurred by an Assignor or
the Collateral Agent, shall be borne by the relevant Assignor.
3.6. Instruments. If any Assignor owns or acquires any
Instrument constituting Collateral, such Assignor will within 10 days notify the
Collateral Agent thereof, and upon request by the Collateral Agent will promptly
deliver such Instrument to the Collateral Agent appropriately endorsed to the
order of the Collateral Agent as further security hereunder.
3.7 Further Actions. Each Assignor will, at its own expense,
make, execute, endorse, acknowledge, file and/or deliver to the Collateral Agent
from time to time such vouchers, invoices, schedules, confirmatory assignments,
conveyances, financing statements, transfer endorsements, powers of attorney,
certificates, reports, notices, requests for acknowledgement and other
assurances or instruments and take such further steps (including any steps
necessary to comply with the Federal Assignment of Claims Act of 1940, but only
if so requested by the Agent or the Required Banks) relating to its Receivables,
Contracts, Instruments and other property or rights covered by the security
interest hereby granted, as the Collateral Agent may reasonably require.
Notwithstanding the foregoing, so long as (x) no Default or Event of Default
then exists and (y) since October 31, 1995, nothing has occurred that has had or
could reasonably be expected to have a Material Adverse Effect, neither the
Agent nor the Required Banks shall be permitted to require the Borrower or any
of its Subsidiaries to give any notice of the Bank's interest in any portion of
the Collateral to any private insurer.
3.8 Paribas Indemnity. Without the consent of the Required
Banks you shall not alter, modify or terminate the Paribas Indemnity. In the
event that the Borrower or any of its Subsidiaries suffers any loss covered by
the Paribas Indemnity, such Credit Party shall fully pursue its claims
thereunder and deliver to the Collateral Agent for the benefit of the Banks any
money recovered thereunder as Collateral hereunder (which monies shall continue
to be held as Collateral hereunder, and shall not be released to the Borrower or
any of its Subsidiaries, except to the extent the Required Banks in their sole
discretion may agree). The Borrower and its Subsidiaries shall direct Banque
Paribas to turn over any and all of the
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Original Instruments which it may subsequently find to the Collateral Agent for
the benefit of the Banks (to be held by it under, and pursuant to the terms of,
the Pledge Agreement) and each Credit Party shall deliver to the Collateral
Agent for the benefit of the Banks (to be held by it under, and pursuant to the
terms of, the Pledge Agreement) any Original Instruments delivered to such
Credit Party; provided that duplicate instruments held by the Collateral Agent
under the Pledge Agreement may be marked "Cancelled" by it and destroyed, in
each case to the satisfaction of the Collateral Agent.
ARTICLE IV
SPECIAL PROVISIONS CONCERNING TRADEMARKS
4.1. Additional Representations and Warranties. Each Assignor
represents and warrants that it is the true, lawful, sole and exclusive owner of
the Marks listed in Annex D hereto and that said listed Marks constitute all the
Marks that such Assignor presently owns or uses in connection with its business
and include all the United States federal registrations or applications
registered in the United States Patent and Trademark Office. Each Assignor
represents and warrants that it owns all Marks that it uses. Each Assignor
further warrants that it has no knowledge as of the date hereof, of any third
party claim that any aspect of such Assignor's present or contemplated business
operations infringes or will infringe any rights in any trademark, service ▇▇▇▇
or trade name. Each Assignor represents and warrants that it is the beneficial
and record owner of all trademark registrations and applications listed in Annex
D hereto and that said registrations are valid, subsisting and have not been
cancelled and that such Assignor is not aware of any third-party claim that any
of said registrations is invalid or unenforceable, or that there is any reason
that any of said applications will not pass to registration. Each Assignor
represents and warrants that upon the recordation of an Assignment of Security
Interest in United States Trademarks and Patents in the form of Annex G hereto
in the United States Patent and Trademark Office, together with filings on Form
UCC-1 pursuant to this Agreement, all filings, registrations and recordings
necessary or appropriate to perfect the security interest granted to the
Collateral Agent in the United States Marks covered by this Agreement under
federal law will have been accomplished. Each Assignor agrees to execute such an
Assignment of Security Interest in United States Trademark and Patents covering
all right, title and interest in each United States ▇▇▇▇, and the associated
goodwill, of such Assignor, and to record the same. Each Assignor hereby grants
to the Collateral Agent an absolute power of attorney to sign, upon the
occurrence and during the continuance of an Event of Default, any document which
may be required by the U.S. Patent and Trademark Office or secretary of state or
equivalent governmental agency of any State of the United States or any foreign
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jurisdiction in order to effect an absolute assignment of all right, title and
interest in each ▇▇▇▇, and record the same.
4.2. Licenses and Assignments. Each Assignor hereby agrees not
to divest itself of any right under any ▇▇▇▇, which is material and/or necessary
to its business, absent prior written approval of the Collateral Agent, except
as otherwise permitted by this Agreement or the Credit Agreement.
4.3. Infringements. Each Assignor agrees, promptly upon
learning thereof, to notify the Collateral Agent in writing of the name and
address of, and to furnish such pertinent information that may be available with
respect to, (i) any party who such Assignor believes is infringing or diluting
or otherwise violating in any respect any of such Assignor's rights in and to
any ▇▇▇▇, or (ii) with respect to any party claiming that such Assignor's use of
any ▇▇▇▇ violates in any material respect any property right of that party. Each
Assignor further agrees, unless otherwise agreed by the Collateral Agent,
diligently to prosecute any Person infringing any ▇▇▇▇.
4.4. Preservation of Marks. Each Assignor agrees to use any of
its Marks which are material and/or necessary to its business in interstate or
foreign commerce, as the case may be, during the time in which this Agreement is
in effect, sufficiently to preserve such Marks as valid and subsisting
trademarks or service marks under the laws of the United States or the relevant
foreign jurisdiction.
4.5. Maintenance of Registration. Each Assignor shall, at its
own expense, diligently process all documents required by the Trademark Act of
1946, as amended, 15 U.S.C. Sections 1051 et seq. to maintain trademark
registrations, including but not limited to affidavits of continued use and
applications for renewals of registration in the United States Patent and
Trademark Office for all of its registered Marks which are material and/or
necessary to its business pursuant to 15 U.S.C. Sections 1058, 1059 and
1065 and any foreign equivalent thereof, and shall pay all fees and
disbursements in connection therewith and shall not abandon any such filing of
affidavit of use or any such application of renewal prior to the exhaustion of
all administrative and judicial remedies without prior written consent of the
Collateral Agent. Each Assignor agrees to notify the Collateral Agent at least
two (2) months prior to the dates on which the affidavits of use or the
applications for renewal registration are due with respect to any registered
▇▇▇▇ that the affidavits of use or the renewal is being processed.
4.6. Future Registered Marks. If any registration for any ▇▇▇▇
which is material and/or necessary to its business issues hereafter to any
Assignor as a result of any
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application now or hereafter pending before the United States Patent and
Trademark Office, within 30 days of receipt of such certificate, such Assignor
shall deliver to the Collateral Agent a copy of such certificate, and an
assignment for security in such ▇▇▇▇, to the Collateral Agent and at the expense
of such Assignor, confirming the assignment for security in such ▇▇▇▇ to the
Collateral Agent hereunder, the form of such security to be substantially the
same as the form hereof or in such other form as may be satisfactory to the
Collateral Agent.
4.7. Remedies. If an Event of Default shall occur and be
continuing, the Collateral Agent may, by written notice to the relevant
Assignor, take any or all of the following actions: (i) declare the entire
right, title and interest of such Assignor in and to each of the Marks, together
with all trademark rights and rights of protection to the same and the goodwill
of such Assignor's business symbolized by said Marks and the right to recover
for post infringements thereof, vested in the Collateral Agent for the benefit
of the Secured Creditors, in which event such rights, title and interest shall
immediately vest, in the Collateral Agent for the benefit of the Secured
Creditors, and the Collateral Agent shall be entitled to exercise the power of
attorney referred to in Section 4.1 to execute, cause to be acknowledged and
notarized and to record said absolute assignment with the applicable agency;
(ii) take and use or sell the Marks and the goodwill of such Assignor's business
symbolized by the Marks and the right to carry on the business and use the
assets of such Assignor in connection with which the Marks have been used; and
(iii) direct such Assignor to refrain, in which event such Assignor shall
refrain, from using the Marks in any manner whatsoever, directly or indirectly,
and, if requested by the Collateral Agent, change such Assignor's corporate name
to eliminate therefrom any use of any ▇▇▇▇ and execute such other and further
documents that the Collateral Agent may request to further confirm this and to
transfer ownership of the Marks and registrations and any pending trademark
applications therefor in the United States Patent and Trademark Office or any
equivalent government agency or office in any foreign jurisdiction to the
Collateral Agent.
ARTICLE V
SPECIAL PROVISIONS CONCERNING
PATENTS, COPYRIGHTS AND TRADE SECRETS
5.1. Additional Representations and Warranties. Each Assignor
represents and warrants that it is the true and lawful exclusive owner of all
rights in (i) all trade secrets and proprietary information necessary to operate
the business of such Assignor (the "Trade Secret Rights"), (ii) the Patents
listed in Annex E hereto and (iii) the Copyrights listed in
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Annex F hereto, that said Patents constitute all the patents and applications
for patents that such Assignor now owns and that are necessary in the conduct of
the business of such Assignor and that such Copyrights constitute all
registrations of copyrights and applications for copyright registrations that
the Assignor now owns and that are necessary in the conduct of the business of
such Assignor. Each Assignor further represents and warrants that it has the
exclusive right to use and practice under all Patents and Copyrights that it
owns, uses or practices under and has the exclusive right to exclude others from
using or practicing under any Patents its owns, uses or practices under. Each
Assignor further warrants that, as of the date hereof it has no knowledge of any
third party claim that any aspect of such Assignor's present or contemplated
business operations infringes or will infringe any rights in any patent or
copyright or such Assignor has misappropriated any trade secret or proprietary
information. Each Assignor represents and warrants that upon the recordation of
an Assignment of Security Interest in United States Trademarks and Patents in
the form of Annex G hereto in the United States Patent and Trademark Office and
the recordation of an Assignment of Security Interest in United States
Copyrights in the form of Annex H hereto in the United States Copyright Office,
together with filings on Form UCC-1 pursuant to this Agreement, all filings,
registrations and recordings necessary or appropriate to perfect the security
interest granted to the Collateral Agent in the United States Patents and United
States Copyrights covered by this Agreement under federal law will have been
accomplished. Each Assignor agrees to execute such an Assignment of Security
Interest in United States Trademarks and Patents covering all right, title and
interest in each United States Patent of such Assignor and to record the same,
and to execute such an Assignment of Security Interest in United States
Copyrights covering all right, title and interest in each United States
Copyright of such Assignor and to record the same. Each Assignor hereby grants
to the Collateral Agent an absolute power of attorney to sign, upon the
occurrence and during the continuance of any Event of Default, any document
which may be required by the U.S. Patent and Trademark Office or equivalent
governmental agency in any foreign jurisdiction or the U.S. Copyright Office or
equivalent governmental agency in any foreign jurisdiction in order to effect an
absolute assignment of all right, title and interest in each Patent and
Copyright, and to record the same.
5.2. Licenses and Assignments. Each Assignor hereby agrees not
to divest itself of any right under any Patent or Copyright which is material
and/or necessary to its business absent prior written approval of the Collateral
Agent, except as otherwise permitted by this Agreement or the Credit Agreement.
5.3. Infringements. Each Assignor agrees, promptly upon
learning thereof, to furnish the Collateral Agent in writing with all pertinent
information available to such Assignor with respect to infringement,
contributing infringement or active inducement to
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infringe in any Patent or Copyright or to any claim that the practice of any
Patent or the use of any Copyright violates any property right of a third party,
or with respect to any misappropriation of any Trade Secret Right or any claim
that practice of any Trade Secret Right violates any property right of a third
party. Each Assignor further agrees, absent direction of the Collateral Agent to
the contrary, diligently to prosecute any Person infringing any Patent or
Copyright or any Person misappropriating any Trade Secret Right.
5.4. Maintenance of Patents and Copyrights. At its own
expense, each Assignor shall make timely payment of all post-issuance fees
required pursuant to 35 U.S.C. Section 41 and any foreign equivalent thereof to
maintain in force rights under each Patent which is material and/or necessary to
its business, and to apply as permitted pursuant to applicable law for any
renewal of each Copyright which is material and/or necessary to its business
absent prior written consent of the Collateral Agent.
5.5. Prosecution of Patent or Copyright Application. At its
own expense, each Assignor shall diligently prosecute all applications for
Patents listed in Annex E hereto which are material and/or necessary to its
business and for Copyrights listed in Annex F hereto which are material and/or
necessary to its business and shall not abandon any such application prior to
exhaustion of all administrative and judicial remedies, absent written consent
of the Collateral Agent.
5.6. Other Patents and Copyrights. Within 30 days of the
acquisition or issuance of a Patent or of a Copyright registration, or of filing
of an application for a Patent or Copyright registration, in each case, which is
material and/or necessary to its business, the relevant Assignor shall deliver
to the Collateral Agent a copy of said Copyright registration or Patent or
certificate or registration of, or application therefor, as the case may be,
with an assignment for security as to such Patent or Copyright, as the case may
be, to the Collateral Agent and at the expense of such Assignor, confirming the
assignment for security, the form of such assignment for security to be
substantially the same as the form hereof or in such other form as may be
satisfactory to the Collateral Agent.
5.7. Remedies. If an Event of Default shall occur and be
continuing, the Collateral Agent may by written notice to the relevant Assignor,
take any or all of the following actions: (i) declare the entire right, title,
and interest of such Assignor in each of the Patents and Copyrights vested in
the Collateral Agent for the benefit of the Secured Creditors, in which event
such right, title, and interest shall immediately vest in the Collateral Agent
for the benefit of the Secured Creditors, in which case the Collateral Agent
shall be entitled to exercise the power of attorney referred to in Section 5.1
to execute, cause to be acknowledged and notarized and to record said absolute
assignment with the applicable
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agency; (ii) take and practice or sell the Patents, Copyrights and Trade Secret
Rights; and (iii) direct such Assignor to refrain, in which event such Assignor
shall refrain, from practicing the Patents and using the Copyrights and/or Trade
Secret Rights directly or indirectly, and such Assignor shall execute such other
and further documents as the Collateral Agent may request further to confirm
this and to transfer ownership of the Patents, Copyrights and Trade Secret
Rights to the Collateral Agent for the benefit of the Secured Creditors.
ARTICLE VI
PROVISIONS CONCERNING ALL COLLATERAL
6.1. Protection of Collateral Agent's Security. Each Assignor
will do nothing to impair the rights of the Collateral Agent in the Collateral.
Each Assignor will at all times keep its Inventory and Equipment insured in
favor of the Collateral Agent, at such Assignor's own expense to the extent and
in the manner provided in the Credit Agreement; all policies or certificates
with respect to such insurance (and any other insurance maintained by such
Assignor); (i) shall be endorsed to the Collateral Agent's satisfaction for the
benefit of the Collateral Agent (including, without limitation, by naming the
Collateral Agent as loss payee and naming each of the Banks, the Agent and the
Collateral Agent as additional insureds); (ii) shall state that such insurance
policies shall not be cancelled or revised without 30 days' prior written notice
thereof by the insurer to the Collateral Agent; and (iii) certified copies of
such policies or certificates shall be deposited with the Collateral Agent. If
any Assignor shall fail to insure its Inventory and Equipment in accordance with
the preceding sentence, or if any Assignor shall fail to so endorse and deposit
all policies or certificates with respect thereto, the Collateral Agent shall
have the right (but shall be under no obligation) to procure such insurance and
such Assignor agrees to promptly reimburse the Collateral Agent for all costs
and expenses of procuring such insurance. The Collateral Agent shall, at the
time such proceeds of such insurance are distributed to the Secured Creditors,
apply such proceeds in accordance with Section 7.4. Each Assignor assumes all
liability and responsibility in connection with the Collateral acquired by it
and the liability of such Assignor to pay the Obligations shall in no way be
affected or diminished by reason of the fact that such Collateral may be lost,
destroyed, stolen, damaged or for any reason whatsoever unavailable to such
Assignor.
6.2. Warehouse Receipts Non-negotiable. Each Assignor agrees
that if any warehouse receipt or receipt in the nature of a warehouse receipt is
issued with respect to any of its Inventory, such warehouse receipt or receipt
in the nature thereof shall not be
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"negotiable" (as such term is used in Section 7-104 of the Uniform Commercial
Code as in effect in any relevant jurisdiction or under other relevant law).
6.3. Further Actions. Each Assignor will, at its own expense,
make, execute, endorse, acknowledge, file and/or deliver to the Collateral Agent
from time to time such lists, descriptions and designations of its Collateral,
warehouse receipts, receipts in the nature of warehouse receipts, bills of
lading, documents of title, vouchers, invoices, schedules, confirmatory
assignments, conveyances, financing statements, transfer endorsements, powers of
attorney, certificates, reports and other assurances or instruments and take
such further steps relating to the Collateral and other property or rights
covered by the security interest hereby granted, which the Collateral Agent
deems reasonably appropriate or advisable to perfect, preserve or protect its
security interest in the Collateral, including, without limitation, any
Collateral which previously constituted Excluded Collateral.
6.4. Financing Statements. Each Assignor agrees to execute and
deliver to the Collateral Agent such financing statements, in form acceptable to
the Collateral Agent, as the Collateral Agent may from time to time request or
as are necessary or desirable in the opinion of the Collateral Agent to
establish and maintain a valid, enforceable, first priority perfected security
interest in the Collateral as provided herein and the other rights and security
contemplated hereby all in accordance with the Uniform Commercial Code as
enacted in any and all relevant jurisdictions or any other relevant law. Each
Assignor will pay any applicable filing fees, recordation taxes and related
expenses relating to its Collateral. Each Assignor hereby authorizes the
Collateral Agent to file any such financing statements without the signature of
such Assignor where permitted by law.
ARTICLE VII
REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT
7.1. Remedies; Obtaining the Collateral Upon Default. Each
Assignor agrees that, if any Event of Default shall have occurred and be
continuing, then and in every such case, the Collateral Agent, in addition to
any rights now or hereafter existing under applicable law, shall have all rights
as a secured creditor under the Uniform Commercial Code in all relevant
jurisdictions and may also:
(i) personally, or by agents or attorneys, immediately take
possession of the Collateral or any part thereof, from such Assignor or
any other Person who
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then has possession of any part thereof with or without notice or
process of law, and for that purpose may enter upon such Assignor's
premises where any of the Collateral is located and remove the same and
use in connection with such removal any and all services, supplies,
aids and other facilities of such Assignor;
(ii) to the extent permitted by applicable law, instruct the
obligor or obligors on any agreement, instrument or other obligation
(including, without limitation, the Receivables and the Contracts)
constituting the Collateral to make any payment required by the terms
of such agreement, instrument or other obligation directly to the
Collateral Agent;
(iii) withdraw all monies, securities and instruments in the
Cash Collateral Account for application to the Obligations in
accordance with Section 7.4;
(iv) sell, assign or otherwise liquidate any or all of the
Collateral or any part thereof in accordance with Section 7.2, or
direct the relevant Assignor to sell, assign or otherwise liquidate any
or all of the Collateral or any part thereof, and, in each case, take
possession of the proceeds of any such sale or liquidation;
(v) take possession of the Collateral or any part thereof,
by directing the relevant Assignor in writing to deliver the same to
the Collateral Agent at any place or places designated by the
Collateral Agent, in which event such Assignor shall at its own
expense:
(x) forthwith cause the same to be moved to the place
or places so designated by the Collateral Agent and there
delivered to the Collateral Agent;
(y) store and keep any Collateral so delivered to the
Collateral Agent at such place or places pending further
action by the Collateral Agent as provided in Section
7.2; and
(z) while the Collateral shall be so stored and kept,
provide such guards and maintenance services as shall be
necessary to protect the same and to preserve and
maintain them in good condition; and
(vi) license or sublicense, whether on an exclusive or
nonexclusive basis, any Marks, Patents or Copyrights included in the
Collateral for such term and on
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such conditions and in such manner as the Collateral Agent shall in its
sole judgment determine;
it being understood that each Assignor's obligation so to deliver the Collateral
is of the essence of this Agreement and that, accordingly, upon application to a
court of equity having jurisdiction, the Collateral Agent shall be entitled to a
decree requiring specific performance by such Assignor of said obligation.
7.2. Remedies; Disposition of the Collateral. Any Collateral
repossessed by the Collateral Agent under or pursuant to Section 7.1 and any
other Collateral whether or not so repossessed by the Collateral Agent, may be
sold, assigned, leased or otherwise disposed of under one or more contracts or
as an entirety, and without the necessity of gathering at the place of sale of
the property to be sold, and in general in such manner, at such time or times,
at such place or places and on such terms as the Collateral Agent may, in
compliance with any mandatory requirements of applicable law, determine to be
commercially reasonable. Any of the Collateral may be sold, leased or otherwise
disposed of, in the condition in which the same existed when taken by the
Collateral Agent or after any overhaul or repair at the expense of the relevant
Assignor which the Collateral Agent shall determine to be commercially
reasonable. Any such disposition which shall be a private sale or other private
proceedings permitted by such requirements shall be made upon not less than 10
days' written notice to the relevant Assignor specifying the time at which such
disposition is to be made and the intended sale price or other consideration
therefor, and shall be subject, for the 10 days after the giving of such notice,
to the right of the relevant Assignor or any nominee of such Assignor to acquire
the Collateral involved at a price or for such other consideration at least
equal to the intended sale price or other consideration so specified. Any such
disposition which shall be a public sale permitted by such requirements shall be
made upon not less than 10 days' written notice to the relevant Assignor
specifying the time and place of such sale and, in the absence of applicable
requirements of law, shall be by public auction (which may, at the Collateral
Agent's option, be subject to reserve), after publication of notice of such
auction not less than 10 days prior thereto in two newspapers in general
circulation to be selected by the Collateral Agent. To the extent permitted by
any such requirement of law, the Collateral Agent may bid for and become the
purchaser of the Collateral or any item thereof, offered for sale in accordance
with this Section without accountability to the relevant Assignor. If, under
mandatory requirements of applicable law, the Collateral Agent shall be required
to make disposition of the Collateral within a period of time which does not
permit the giving of notice to the relevant Assignor as hereinabove specified,
the Collateral Agent need give such Assignor only such notice of disposition as
shall be reasonably practicable in view of such mandatory requirements of
applicable law. Each Assignor agrees to do or cause to be done all such other
acts and things as may be reasonably necessary to make such sale
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or sales of all or any portion of the Collateral of such Assignor valid and
binding and in compliance with any and all applicable laws, regulations, orders,
writs, injunctions, decrees or awards of any and all courts, arbitrations or
governmental instrumentalities, domestic or foreign, having jurisdiction over
any such sale or sales, all at such Assignor's expense.
7.3. Waiver of Claims. Except as otherwise provided in this
Agreement, EACH ASSIGNOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE COLLATERAL AGENT'S
TAKING POSSESSION OR THE COLLATERAL AGENT'S DISPOSITION OF ANY OF THE
COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING
FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH SUCH ASSIGNOR
WOULD OTHERWISE HAVE UNDER THE CONSTITUTION OR ANY STATUTE OF THE UNITED STATES
OR OF ANY STATE, and such Assignor hereby further waives, to the extent
permitted by law:
(i) all damages occasioned by such taking of possession
except any damages which are the direct result of the Collateral
Agent's gross negligence or willful misconduct;
(ii) all other requirements as to the time, place and terms
of sale or other requirements with respect to the enforcement of the
Collateral Agent's rights hereunder; and
(iii) all rights of redemption, appraisement, valuation, stay,
extension or moratorium now or hereafter in force under any applicable
law in order to prevent or delay the enforcement of this Agreement or
the absolute sale of the Collateral or any portion thereof, and each
Assignor, for itself and all who may claim under it,
insofar as it or they now or hereafter lawfully may, hereby waives the
benefit of all such laws.
Any sale of, or the grant of options to purchase, or any other realization upon,
any Collateral shall operate to divest all right, title, interest, claim and
demand, either at law or in equity, of the relevant Assignor therein and
thereto, and shall be a perpetual bar both at law and in equity against such
Assignor and against any and all Persons claiming or attempting to claim the
Collateral so sold, optioned or realized upon, or any part thereof, from,
through and under such Assignor.
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7.4. Application of Proceeds. (a) All moneys collected by the
Collateral Agent upon any sale or other disposition of the Collateral (or, to
the extent the Pledge Agreement or Mortgages require proceeds of collateral
thereunder to be applied in accordance with the provisions of this Agreement,
the Pledgee or Mortgagee under such other Security Documents), together with all
other moneys received by the Collateral Agent hereunder, shall be applied as
follows:
(i) first, to the payment of all Obligations owing the
Collateral Agent of the type described in clauses (iii) and (iv) of the
definition of "Obligations";
(ii) second, to the extent proceeds remain after the
application pursuant to the preceding clause (i), an amount equal to
the outstanding Primary Obligations shall be paid to the Secured
Creditors as provided in Section 7.4(e), with each Secured Creditor
receiving an amount equal to its outstanding Primary Obligations or, if
the proceeds are insufficient to pay in full all such Primary
Obligations, its Pro Rata Share of the amount remaining to be
distributed;
(iii) third, to the extent proceeds remain after the
application pursuant to the preceding clauses (i) and (ii), an amount
equal to the outstanding Secondary Obligations shall be paid to the
Secured Creditors as provided in Section 7.4(e), with each Secured
Creditor receiving an amount equal to its outstanding Secondary
Obligations or, if the proceeds are insufficient to pay in full all
such Secondary Obligations, its Pro Rata Share of the amount remaining
to be distributed; and
(iv) fourth, to the extent proceeds remain after the
application pursuant to the preceding clauses (i) through (iii),
inclusive, and following the termination of this Agreement pursuant to
Section 10.8(a) hereof, to the relevant Assignor or to whomever may be
lawfully entitled to receive such surplus.
(b) For purposes of this Agreement (x) "Pro Rata Share" shall
mean, when calculating a Secured Creditor's portion of any distribution or
amount, that amount (expressed as a percentage) equal to a fraction the
numerator of which is the then unpaid amount of such Secured Creditor's Primary
Obligations or Secondary Obligations, as the case may be, and the denominator of
which is the then outstanding amount of all Primary Obligations or Secondary
Obligations, as the case may be, (y) "Primary Obligations" shall mean (i) in the
case of the Credit Document Obligations, all principal of, and interest on, all
Loans under the Credit Agreement, all Unpaid Drawings theretofore made (together
with all interest accrued thereon), the aggregate Stated Amounts of all Letters
of Credit issued (or deemed issued) under the Credit Agreement, and all Fees and
(ii) in the case of the Other
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Obligations, all amounts due under the Interest Rate Protection Agreements or
Other Hedging Agreements (other than indemnities, fees (including, without
limitation, attorneys' fees) and similar obligations and liabilities) and (z)
"Secondary Obligations" shall mean all Obligations other than Primary
Obligations.
(c) When payments to Secured Creditors are based upon their
respective Pro Rata Shares, the amounts received by such Secured Creditors
hereunder shall be applied (for purposes of making determinations under this
Section 7.4 only) (i) first, to their Primary Obligations and (ii) second, to
their Secondary Obligations. If any payment to any Secured Creditor of its Pro
Rata Share of any distribution would result in overpayment to such Secured
Creditor, such excess amount shall instead be distributed in respect of the
unpaid Primary Obligations or Secondary Obligations, as the case may be, of the
other Secured Creditors, with each Secured Creditor whose Primary Obligations or
Secondary Obligations, as the case may be, have not been paid in full to receive
an amount equal to such excess amount multiplied by a fraction the numerator of
which is the unpaid Primary Obligations or Secondary Obligations, as the case
may be, of such Secured Creditor and the denominator of which is the unpaid
Primary Obligations or Secondary Obligations, as the case may be, of all Secured
Creditors entitled to such distribution.
(d) Each of the Secured Creditors agrees and acknowledges that
if the Bank Creditors are to receive a distribution on account of undrawn
amounts with respect to Letters of Credit issued (or deemed issued) under the
Credit Agreement (which shall only occur after all outstanding Loans and Unpaid
Drawings with respect to such Letters of Credit have been paid in full), such
amounts shall be paid to the Agent under the Credit Agreement and held by it,
for the equal and ratable benefit of the Bank Creditors, as cash security for
the repayment of Obligations owing to the Bank Creditors as such. If any amounts
are held as cash security pursuant to the immediately preceding sentence, then
upon the termination of all outstanding Letters of Credit, and after the
application of all such cash security to the repayment of all Obligations owing
to the Bank Creditors after giving effect to the termination of all such Letters
of Credit, if there remains any excess cash, such excess cash shall be returned
by the Agent to the Collateral Agent for distribution in accordance with Section
7.4(a) hereof.
(e) Except as set forth in Section 7.4(d), all payments
required to be made hereunder shall be made (x) if to the Bank Creditors, to the
Agent under the Credit Agreement for the account of the Bank Creditors, and (y)
if to the Other Creditors, to the trustee, paying agent or other similar
representative (each, a "Representative") for the Other Creditors or, in the
absence of such a Representative, directly to the Other Creditors.
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(f) For purposes of applying payments received in accordance
with this Section 7.4, the Collateral Agent shall be entitled to rely upon (i)
the Agent under the Credit Agreement and (ii) the Representative for the Other
Creditors or, in the absence of such a Representative, upon the Other Creditors
for a determination (which the Agent, each Representative for any Secured
Creditors and the Secured Creditors agree (or shall agree) to provide upon
request of the Collateral Agent) of the outstanding Primary Obligations and
Secondary Obligations owed to the Bank Creditors or the Other Creditors, as the
case may be. Unless it has actual knowledge (including by way of written notice
from a Bank Creditor or an Other Creditor) to the contrary, the Agent and each
Representative, in furnishing information pursuant to the preceding sentence,
and the Collateral Agent, in acting hereunder, shall be entitled to assume that
no Secondary Obligations are outstanding. Unless it has actual knowledge
(including by way of written notice from an Other Creditor) to the contrary, the
Collateral Agent, in acting hereunder, shall be entitled to assume that no
Interest Rate Protection Agreements or Other Hedging Agreements are in
existence.
(g) It is understood and agreed that each of the Assignors
shall remain liable to the extent of any deficiency between the amount of the
proceeds of the Collateral hereunder and the aggregate amount of the sums
referred to in clause (a) of this Section with respect to the relevant Assignor.
7.5. Remedies Cumulative. Each and every right, power and
remedy hereby specifically given to the Collateral Agent shall be in addition to
every other right, power and remedy specifically given under this Agreement, the
Interest Rate Protection Agreements or Other Hedging Agreements or the other
Credit Documents now or hereafter existing at law, in equity or by statute and
each and every right, power and remedy whether specifically herein given or
otherwise existing may be exercised from time to time or simultaneously and as
often and in such order as may be deemed expedient by the Collateral Agent. All
such rights, powers and remedies shall be cumulative and the exercise or the
beginning of the exercise of one shall not be deemed a waiver of the right to
exercise any other or others. No delay or omission of the Collateral Agent in
the exercise of any such right, power or remedy and no renewal or extension of
any of the Obligations shall impair any such right, power or remedy or shall be
construed to be a waiver of any Default or Event of Default or an acquiescence
therein. No notice to or demand on any Assignor in any case shall entitle it to
any other or further notice or demand in similar or other circumstances or
constitute a waiver of any of the rights of the Collateral Agent to any other or
further action in any circumstances without notice or demand. In the event that
the Collateral Agent shall bring any suit to enforce any of its rights hereunder
and shall be entitled to judgment, then in such suit the Collateral Agent may
recover expenses, including attorneys' fees, and the amounts thereof shall be
included in such judgment.
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7.6. Discontinuance of Proceedings. In case the Collateral
Agent shall have instituted any proceeding to enforce any right, power or remedy
under this Agreement by foreclosure, sale, entry or otherwise, and such
proceeding shall have been discontinued or abandoned for any reason or shall
have been determined adversely to the Collateral Agent, then and in every such
case the relevant Assignor, the Collateral Agent and each holder of any of the
Obligations shall be restored to their former positions and rights hereunder
with respect to the Collateral subject to the security interest created under
this Agreement, and all rights, remedies and powers of the Collateral Agent
shall continue as if no such proceeding had been instituted.
ARTICLE VIII
INDEMNITY
8.1. Indemnity. (a) Each Assignor jointly and severally agrees
to indemnify, reimburse and hold the Collateral Agent, each Secured Creditor and
their respective successors, permitted assigns, employees, agents and servants
(hereinafter in this Section 8.1 referred to individually as an "Indemnitee,"
and, collectively, as "Indemnities") harmless from any and all liabilities,
obligations, damages, injuries, penalties, claims, demands, actions, suits,
judgments and any and all costs, expenses or disbursements (including attorneys'
fees and expenses) (for the purposes of this Section 8.1 the foregoing are
collectively called "expenses") of whatsoever kind and nature imposed on,
asserted against or incurred by any of the Indemnities in any way relating to or
arising out of this Agreement, any Interest Rate Protection Agreement or Other
Hedging Agreement, any other Credit Document or any other document executed in
connection herewith or therewith or in any other way connected with the
administration of the transactions contemplated hereby or thereby or the
enforcement of any of the terms of, or the preservation of any rights under any
thereof, or in any way relating to or arising out of the manufacture, ownership,
ordering, purchase, delivery, control, acceptance, lease, financing, possession,
operation, condition, sale, return or other disposition, or use of the
Collateral (including, without limitation, latent or other defects, whether or
not discoverable), the violation of the laws of any country, state or other
governmental body or unit, any tort (including, without limitation, claims
arising or imposed under the doctrine of strict liability, or for or on account
of injury to or the death of any Person (including any Indemnitee), or property
damage), or contract claim; provided that no Indemnitee shall be indemnified
pursuant to this Section 8.1(a) for losses, damages or liabilities to the extent
caused by the gross negligence or willful misconduct of such Indemnitee. Each
Assignor agrees that upon written notice by any Indemnitee of the assertion of
such a liability, obligation, damage, injury, penalty, claim, demand, action,
suit
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or judgment, the relevant Assignor shall assume full responsibility for the
defense thereof. Each Indemnitee agrees to use its best efforts to promptly
notify the relevant Assignor of any such assertion of which such Indemnitee has
knowledge.
(b) Without limiting the application of Section 8.1(a), each
Assignor agrees, jointly and severally, to pay, or reimburse the Collateral
Agent for any and all fees, costs and expenses of whatever kind or nature
incurred in connection with the creation, preservation or protection of the
Collateral Agent's Liens on, and security interest in, the Collateral,
including, without limitation, all fees and taxes in connection with the
recording or filing of instruments and documents in public offices, payment or
discharge of any taxes or Liens upon or in respect of the Collateral, premiums
for insurance with respect to the Collateral and all other fees, costs and
expenses in connection with protecting, maintaining or preserving the Collateral
and the Collateral Agent's interest therein, whether through judicial
proceedings or otherwise, or in defending or prosecuting any actions, suits or
proceedings arising out of or relating to the Collateral.
(c) Without limiting the application of Section 8.1(a) or (b),
each Assignor agrees, jointly and severally, to pay, indemnify and hold each
Indemnitee harmless from and against any loss, costs, damages and expenses which
such Indemnitee may suffer, expend or incur in consequence of or growing out of
any misrepresentation by any Assignor in this Agreement, any Interest Rate
Protection Agreement or Other Hedging Agreement, any other Credit Document or in
any writing contemplated by or made or delivered pursuant to or in connection
with this Agreement, any Interest Rate Protection Agreement or Other Hedging
Agreement or any other Credit Document.
(d) If and to the extent that the obligations of any Assignor
under this Section 8.1 are unenforceable for any reason, such Assignor hereby
agrees to make the maximum contribution to the payment and satisfaction of
such obligations which is permissible under applicable law.
8.2. Indemnity Obligations Secured by Collateral; Survival.
Any amounts paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral. The
indemnity obligations of each Assignor contained in this Article VIII shall
continue in full force and effect notwithstanding the full payment of all the
Notes issued under the Credit Agreement, the termination of all Interest Rate
Protection Agreements or Other Hedging Agreements and Letters of Credit, and the
payment of all other Obligations and notwithstanding the discharge thereof.
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ARTICLE IX
DEFINITIONS
The following terms shall have the meanings herein specified.
Such definitions shall be equally applicable to the singular and plural forms of
the terms defined.
"Agent" shall have the meaning provided in the recitals to
this Agreement.
"Agreement" shall have the meaning provided in the preamble to
this Agreement.
"Assignor" shall have the meaning provided in the preamble to
this Agreement.
"Bank Creditors" shall have the meaning provided in the
recitals to this Agreement.
"Banks" shall have the meaning provided in the recitals to
this Agreement.
"Borrower" shall have the meaning provided in the recitals to
this Agreement.
"Cash Collateral Account" shall mean a non-interest bearing
cash collateral account maintained with, and in the sole dominion and control
of, the Collateral Agent for the benefit of the Secured Creditors.
"Chattel Paper" shall have the meaning provided in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.
"Class" shall have the meaning provided in Section 10.2 of
this Agreement.
"Collateral" shall have the meaning provided in Section 1.1(a)
of this Agreement.
"Collateral Agent" shall have the meaning provided in the
preamble to this Agreement.
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"Contract Rights" shall mean all rights of any Assignor
(including without limitation all rights to payment) under each Contract
(including without limitation all such rights under the Paribas Indemnity).
"Contracts" shall mean all contracts between any Assignor and
one or more additional parties (including, without limitation, (x) any Interest
Rate Protection Agreements or Other Hedging Agreements and (y) the Paribas
Indemnity), but excluding those Contracts to the extent that the terms thereof
expressly prohibit the assignment of, or granting of a security interest in,
such Assignor's rights and obligations thereunder.
"Copyrights" shall mean any U.S. or foreign copyright owned by
any Assignor, including any registrations of any Copyrights, in the U.S.
Copyright Office or the equivalent thereof in any foreign country, as well as
any application for a U.S. or foreign copyright registration now or hereafter
made with the U.S. Copyright Office or the equivalent thereof in any foreign
jurisdiction by any Assignor.
"Credit Agreement" shall have the meaning provided in the
recitals to this Agreement.
"Credit Document Obligations" shall have the meaning provided
in the definition of "Obligations" in this Article IX.
"Default" shall mean any event which, with notice or lapse of
time, or both, would constitute an Event of Default.
"Documents" shall have the meaning provided in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.
"Equipment" shall mean any "equipment," as such term is
defined in the Uniform Commercial Code as in effect on the date hereof in the
State of New York, now or hereafter owned by any Assignor and, in any event,
shall include, but shall not be limited to, all machinery, equipment,
furnishings, movable trade fixtures and vehicles now or hereafter owned by any
Assignor and any and all additions, substitutions and replacements of any of the
foregoing, wherever located, together with all attachments, components, parts,
equipment and accessories installed thereon or affixed thereto.
"Event of Default" shall mean any Event of Default under, and
as defined in, the Credit Agreement or any payment default under any Interest
Rate Protection Agreement
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or Other Hedging Agreement and shall in any event, without limitation, include
any payment default on any of the Obligations after the expiration of any
applicable grace period.
"General Intangibles" shall have the meaning provided in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York.
"Goods" shall have the meaning provided in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.
"Indemnitee" shall have the meaning provided in Section 8.1 of
this Agreement.
"Instrument" shall have the meaning provided in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.
"Interest Rate Protection Agreement or Other Hedging
Agreement" shall have the meaning provided in the recitals to this Agreement.
"Inventory" shall mean merchandise, inventory and goods, and
all additions, substitutions and replacements thereof, wherever located,
together with all goods, supplies, incidentals, packaging materials, labels,
materials and any other items used or usable in manufacturing, processing,
packaging or shipping same; in all stages of production -- from raw materials
through work-in-process to finished goods -- and all products and proceeds of
whatever sort and wherever located and any portion thereof which may be
returned, rejected, reclaimed or repossessed by the Collateral Agent from any
Assignor's customers, and shall specifically include all "inventory" as such
term is defined in the Uniform Commercial Code as in effect on the date hereof
in the State of New York, now or hereafter owned by any Assignor.
"Liens" shall mean any security interest, mortgage, pledge,
lien, claim, charge, encumbrance, title retention agreement, lessor's interest
in a financing lease or analogous instrument, in, of, or on any Assignor's
property.
"Marks" shall mean all right, title and interest in and to any
U.S. or foreign trademarks, service marks and trade names now held or hereafter
acquired by any Assignor, including any registration or application for
registration of any trademarks and service marks in the United States Patent and
Trademark Office, or the equivalent thereof in any State of the United States or
in any foreign country, and any trade dress including logos, designs,
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trade names, company names, business names, fictitious business names and other
business identifiers in connection with which any of these registered or
unregistered marks are used.
"Obligations" shall mean (i) the full and prompt payment when
due (whether at the stated maturity, by acceleration or otherwise) of all
obligations and liabilities (including, without limitation, indemnities, fees
and interest thereon) of each Assignor owing to the Bank Creditors, now existing
or hereafter incurred under, arising out of or in connection with any Credit
Document to which such Assignor is a party (including all such obligations and
indebtedness under the Subsidiaries Guaranty if such Assignor is a party) and
the due performance and compliance by each Assignor with the terms, conditions
and agreements of each such Credit Document (all such obligations or liabilities
under this clause (i), except to the extent consisting of obligations or
indebtedness with respect to Interest Rate Protection Agreements or Other
Hedging Agreements, being herein collectively called the "Credit Document
Obligations"); (ii) the full and prompt payment when due (whether at the stated
maturity, by acceleration or otherwise) of all obligations and liabilities
(including, without limitation, indemnities, fees and interest thereon) of each
Assignor owing to the Other Creditors, now existing or hereafter incurred under,
arising out of or in connection with any Interest Rate Protection Agreement or
Other Hedging Agreement, whether such Interest Rate Protection Agreement or
Other Hedging Agreement is now in existence or hereafter arising, including, in
the case of the Subsidiaries each Subsidiary Guarantor, all obligations under
the Subsidiaries Guaranty, in each case, in respect of Interest Rate Protection
Agreements or Other Hedging Agreements, and the due performance and compliance
by such Assignor with all of the terms, conditions and agreements contained in
any such Interest Rate Protection Agreement or Other Hedging Agreement (all such
obligations and indebtedness under this clause (ii) being herein collectively
called the "Other Obligations"); (iii) any and all sums advanced by the
Collateral Agent in order to preserve the Collateral or preserve its security
interest in the Collateral; (iv) in the event of any proceeding for the
collection or enforcement of any indebtedness, obligations, or liabilities of
each Assignor referred to in clauses (i), (ii) and (iii) after an Event of
Default shall have occurred and be continuing, the reasonable expenses of
retaking, holding, preparing for sale or lease, selling or otherwise disposing
of or realizing on the Collateral, or of any exercise by the Collateral Agent of
its rights hereunder, together with reasonable attorneys' fees and court costs;
and (v) all amounts paid by any Indemnitee as to which such Indemnitee has the
right to reimbursement under Section 8.1 of this Agreement. It is acknowledged
and agreed that the "Obligations" shall include extensions of credit of the
types described above, whether outstanding on the date of this Agreement or
extended from time to time after the date of this Agreement.
"Original Instruments" shall have the meaning contained in the
Paribas Indemnity.
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"Other Creditors" shall have the meaning provided in the
recitals to this Agreement.
"Other Obligations" shall have the meaning provided in the
definition of "Obligations" in this Article IX.
"Paribas Indemnity" shall mean the Lost Collateral Indemnity
Agreement, dated as of July 31, 1996, between Banque Paribas and the Borrower.
"Patents" shall mean any U.S. or foreign patent to which any
Assignor now or hereafter has title and any divisions or continuations thereof,
as well as any application for a U.S. or foreign patent now or hereafter made by
any Assignor.
"Pledged Securities" shall have the meaning provided in the
Pledge Agreement.
"Primary Obligations" shall have the meaning provided in
Section 7.4(b) of this Agreement.
"Proceeds" shall have the meaning provided in the Uniform
Commercial Code as in effect in the State of New York on the date hereof or
under other relevant law and, in any event, shall include, but not be limited
to, (i) any and all proceeds of any insurance, indemnity, warranty or guaranty
payable to the Collateral Agent or any Assignor from time to time with respect
to any of the Collateral, (ii) any and all payments (in any form whatsoever)
made or due and payable to any Assignor from time to time in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of all or any
part of the Collateral by any governmental authority (or any person acting under
color of governmental authority) and (iii) any and all other amounts from time
to time paid or payable under or in connection with any of the Collateral.
"Pro Rata Share" shall have the meaning provided in Section
7.4(b) of this Agreement.
"Receivables" shall mean any "account" as such term is defined
in the Uniform Commercial Code as in effect on the date hereof in the State of
New York, now or hereafter owned by any Assignor and, in any event, shall
include, but shall not be limited to, all of such Assignor's rights to payment
for, or exchange of, goods sold or leased or services performed or product
exchanged by such Assignor, whether now in existence or arising from time to
time hereafter, including, without limitation, rights evidenced by an account,
note,
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contract, barter arrangement, security agreement, chattel paper, or other
evidence of indebtedness or security, together with (a) all security pledged,
assigned, hypothecated or granted to or held by such Assignor to secure the
foregoing, (b) all of any Assignor's right, title and interest in and to any
goods or services, the sale or exchange of which gave rise thereto, (c) all
guarantees, endorsements and indemnifications on, or of, any of the foregoing,
(d) all powers of attorney for the execution of any evidence of indebtedness or
security or other writing in connection therewith, (e) all books, records,
ledger cards, and invoices relating thereto, (f) all evidences of the filing of
financing statements and other statements and the registration of other
instruments in connection therewith and amendments thereto, notices to other
creditors or secured parties, and certificates from filing or other registration
officers, (g) all credit information, reports and memoranda relating thereto and
(h) all other writings related in any way to the foregoing.
"Representative" shall have the meaning provided in Section
7.4(e).
"Requisite Creditors" shall have the meaning provided in
Section 10.2 of this Agreement.
"Secondary Obligations" shall have the meaning provided in
Section 7.4(b) of this Agreement.
"Secured Creditors" shall have the meaning provided in the
recitals to this Agreement.
"Termination Date" shall have the meaning provided in Section
10.8 of this Agreement.
"Trade Secret Rights" shall have the meaning provided in
Section 5.1 of this Agreement.
ARTICLE X
MISCELLANEOUS
10.1. Notices. Except as otherwise specified herein, all
notices, requests, demands or other communications to or upon the respective
parties hereto shall be deemed to have been duly given or made when delivered to
the party to which such notice, request,
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demand or other communication is required or permitted to be given or made under
this Agreement, addressed:
(a) if to any Assignor, at it address set forth opposite its
signature below;
(b) if to the Collateral Agent:
Bankers Trust Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
(c) if to any Bank Creditor (other than the Collateral Agent),
at such address as such Bank Creditor shall have specified in the
Credit Agreement; and
(d) if to any Other Creditor, at such address as such Other
Creditor shall have specified in writing to each Assignor and the
Collateral Agent;
or at such other address as shall have been furnished in writing by any Person
described above to the party required to give notice hereunder.
10.2. Waiver; Amendment. None of the terms and conditions of
this Agreement may be changed, waived, modified or varied in any manner
whatsoever unless in writing duly signed by each Assignor directly and adversely
affected thereby and the Collateral Agent (with the consent of (x) the Required
Banks (or all the Banks if required by Section 13.12 of the Credit Agreement) at
all times prior to the time at which all Credit Document Obligations have been
paid in full and all Commitments under the Credit Agreement have been terminated
or (y) the holders of at least a majority of the outstanding Other Obligations
at all times after the time on which all Credit Document Obligations have been
paid in full and all Commitments under the Credit Agreement have been
terminated; provided, that any change, waiver, modification or variance
affecting the rights and benefits of a single Class (as defined below) of
Secured Creditors (and not all Secured Creditors in a like or similar manner)
shall require the written consent of the Requisite Creditors (as defined below)
of such Class of Secured Creditors. For the purpose of this Agreement the term
"Class" shall mean each class of Secured Creditors, i.e., whether (x) the Bank
Creditors as holders of the Credit Document Obligations or (y) the Other
Creditors as the holders of the Other Obligations. For the purpose of this
Agreement, the term "Requisite Creditors" of any Class
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shall mean each of (x) with respect to the Credit Document Obligations, the
Required Banks and (y) with respect to the Other Obligations, the holders of at
least a majority of all obligations outstanding from time to time under the
Interest Rate Protection Agreements or Other Hedging Agreements.
10.3. Obligations Absolute. The obligations of each Assignor
hereunder shall remain in full force and effect without regard to, and shall not
be impaired by, (a) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of such Assignor; (b) any
exercise or non-exercise, or any waiver of, any right, remedy, power or
privilege under or in respect of this Agreement, any other Credit Document or
any Interest Rate Protection Agreement or Other Hedging Agreement; or (c) any
renewal, extension, amendment or modification of or addition or supplement to or
deletion from any Credit Document or any Interest Rate Protection Agreement or
Other Hedging Agreement or any security for any of the Obligations; (d) any
waiver, consent, extension, indulgence or other action or inaction under or in
respect of any such agreement or instrument including, without limitation, this
Agreement; (e) any furnishing of any additional security to the Collateral Agent
or its assignee or any acceptance thereof or any release of any security by the
Collateral Agent or its assignee; or (f) any limitation on any party's liability
or obligations under any such instrument or agreement or any invalidity or
unenforceability, in whole or in part, of any such instrument or agreement or
any term thereof; whether or not any Assignor shall have notice or knowledge of
any of the foregoing. The rights and remedies of the Collateral Agent herein
provided are cumulative and not exclusive of any rights or remedies which the
Collateral Agent would otherwise have.
10.4. Successors and Assigns. This Agreement shall be binding
upon each Assignor and its successors and assigns and shall inure to the benefit
of the Collateral Agent and its successors and assigns; provided, that no
Assignor may transfer or assign any or all of its rights or obligations
hereunder without the prior written consent of the Collateral Agent. All
agreements, statements, representations and warranties made by each Assignor
herein or in any certificate or other instrument delivered by such Assignor or
on its behalf under this Agreement shall be considered to have been relied upon
by the Secured Creditors and shall survive the execution and delivery of this
Agreement, the other Credit Documents and the Interest Rate Protection
Agreements or Other Hedging Agreements regardless of any investigation made by
the Secured Creditors or on their behalf.
10.5. Headings Descriptive. The headings of the several
sections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.
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10.6. Governing Law. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
10.7. Assignor's Duties. It is expressly agreed, anything
herein contained to the contrary notwithstanding, that each Assignor shall
remain liable to perform all of the obligations, if any, assumed by it with
respect to the Collateral and the Collateral Agent shall not have any
obligations or liabilities with respect to any Collateral by reason of or
arising out of this Agreement, nor shall the Collateral Agent be required or
obligated in any manner to perform or fulfill any of the obligations of each
Assignor under or with respect to any Collateral.
10.8. Termination; Release. (a) After the Termination Date (as
defined below), this Agreement shall terminate (provided that all indemnities
set forth herein including, without limitation, in Section 8.1 hereof shall
survive such termination) and the Collateral Agent, at the request and expense
of the respective Assignor, will promptly execute and deliver to such Assignor a
proper instrument or instruments (including Uniform Commercial Code termination
statements on form UCC-3) acknowledging the satisfaction and termination of this
Agreement, and will duly assign, transfer and deliver to such Assignor (without
recourse and without any representation or warranty) such of the Collateral as
may be in the possession of the Collateral Agent and as has not theretofore been
sold or otherwise applied or released pursuant to this Agreement. As used in
this Agreement, "Termination Date" shall mean the date upon which the Total
Commitment and all Interest Rate Protection Agreements or Other Hedging
Agreements have been terminated, no Note is outstanding (and all Loans have been
paid in full), all Letters of Credit have been terminated and all other
Obligations then owing have been paid in full.
(b) In the event that any part of the Collateral is sold
(other than to another Assignor) (x) at any time prior to the time at which all
Credit Document Obligations have been paid in full and all Commitments under the
Credit Agreement have been terminated, in connection with a sale (other than to
another Assignor) permitted by Section 9.02 of the Credit Agreement or is
otherwise released at the direction of the Required Banks (or all the Banks if
required by Section 13.12 of the Credit Agreement) or (y) at any time
thereafter, to the extent permitted by the Interest Rate Protection Agreements
or Other Hedging Agreements, and in the case of clause (x) and (y), the proceeds
of such sale or sales or from such release are applied in accordance with the
terms of the Credit Agreement or such Interest Rate Protection Agreements or
Other Hedging Agreements, as the case may be, to the extent required to be so
applied, the Collateral Agent, at the request and expense of such
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Assignor, will duly assign, transfer and deliver to such Assignor (without
recourse and without any representation or warranty) such of the Collateral as
is then being (or has been) so sold or released and as may be in the possession
of the Collateral Agent and has not theretofore been released pursuant to this
Agreement.
(c) At any time that the respective Assignor desires that
Collateral be released as provided in the foregoing Section 10.8(a) or (b), it
shall deliver to the Collateral Agent a certificate signed by an Authorized
Officer stating that the release of the respective Collateral is permitted
pursuant to Section 10.8(a) or (b). If requested by the Collateral Agent
(although the Collateral Agent shall have no obligation to make any such
request), the relevant Assignor shall furnish appropriate legal opinions (from
counsel, which may be in-house counsel, reasonably acceptable to the Collateral
Agent) to the effect set forth in the immediately preceding sentence. The
Collateral Agent shall have no liability whatsoever to any Secured Creditor as
the result of any release of Collateral by it as permitted by this Section 10.8.
10.9. Counterparts. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument. A set of
counterparts executed by all the parties hereto shall be lodged with the
Borrower and the Collateral Agent.
10.10. The Collateral Agent. The Collateral Agent will hold in
accordance with this Agreement all items of the Collateral at any time received
under this Agreement. It is expressly understood and agreed that the obligations
of the Collateral Agent as holder of the Collateral and interests therein and
with respect to the disposition thereof, and other- wise under this Agreement,
are only those expressly set forth in this Agreement. The Collateral Agent shall
act hereunder on the terms and conditions set forth in Section 12 of the Credit
Agreement.
10.11. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.12. Limited Obligations. It is the desire and intent of
each Assignor and the Secured Creditors that this Agreement shall be enforced
against each Assignor to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which
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enforcement is sought. Notwithstanding anything to the contrary contained
herein, in furtherance of the foregoing, it is noted that the obligations of
each Subsidiary Guarantor constituting an Assignor have been limited as, and
only to the extent, provided in Section 28 of the Subsidiaries Guaranty.
10.13. Additional Assignors. It is understood and agreed that
any Subsidiary of the Borrower that is required to execute a counterpart of this
Agreement after the date hereof pursuant to the Credit Agreement shall
automatically become an Assignor hereunder by executing a counterpart hereof and
delivering the same to the Collateral Agent.
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* * *
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered by their duly authorized officers as of
the date first above written.
Address
Tri-Parkway Corporate Park TRANSWORLD HOME
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ HEALTHCARE, INC.,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ as a Pledgor
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone No.:(▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.:(▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Title: Senior Vice President
Tri-Parkway Corporate Park DERMAQUEST, INC.,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ as a Pledgor
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ ---------------------------
Title: Vice President
Tri-Parkway Corporate Park MK DIABETIC SUPPORT SERVICES, INC.,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ as a Pledgor
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Title: Vice President
Tri-Parkway Corporate Park THE PROMPTCARE COMPANIES, INC.,
42
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ as a Pledgor
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Title: Vice President
Tri-Parkway Corporate Park THE PROMPTCARE LUNG CENTER, INC.,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ as a Pledgor
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Title: Vice President
Tri-Parkway Corporate Park STERI-PHARM, INC.,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ as a Pledgor
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ --------------------------
Title: Vice President
Tri-Parkway Corporate Park TRANSWORLD NURSES, INC.,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ as a Pledgor
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Title: Vice President
43
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Tri-Parkway Corporate Park RADAMERICA, INC.,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ as a Pledgor
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Title: Vice President
Tri-Parkway Corporate Park RESPIFLOW, INC.,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ as a Pledgor
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ --------------------------
Title: Vice President
BANKERS TRUST COMPANY,
as Pledgee
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Title: Vice President