EXHIBIT 10.3
EXECUTION COPY
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SECURITY AGREEMENT
Dated as of September 30, 2004
among
ICG, LLC,
as Borrower
and
THE GUARANTORS PARTY HERETO
and
UBS AG, STAMFORD BRANCH,
as Collateral Agent
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
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TABLE OF CONTENTS
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PREAMBLE................................................................................................... 1
RECITALS................................................................................................... 1
AGREEMENT.................................................................................................. 2
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1. DEFINITIONS.............................................................................. 2
SECTION 1.2. INTERPRETATION........................................................................... 11
SECTION 1.3. RESOLUTION OF DRAFTING AMBIGUITIES....................................................... 11
SECTION 1.4. PERFECTION CERTIFICATE................................................................... 11
ARTICLE II
GRANT OF SECURITY AND SECURED OBLIGATIONS
SECTION 2.1. GRANT OF SECURITY INTEREST............................................................... 12
SECTION 2.2. FILINGS.................................................................................. 14
ARTICLE III
PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES;
USE OF PLEDGED COLLATERAL
SECTION 3.1. DELIVERY OF CERTIFICATED SECURITIES COLLATERAL........................................... 14
SECTION 3.2. PERFECTION OF UNCERTIFICATED SECURITIES COLLATERAL....................................... 15
SECTION 3.3. FINANCING STATEMENTS AND OTHER FILINGS; MAINTENANCE OF PERFECTED SECURITY
INTEREST.............................................................................. 15
SECTION 3.4. OTHER ACTIONS............................................................................ 16
SECTION 3.5. FURTHER ASSURANCES....................................................................... 20
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 4.1. TITLE.................................................................................... 21
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SECTION 4.2. VALIDITY OF SECURITY INTEREST............................................................ 21
SECTION 4.3. DEFENSE OF CLAIMS; TRANSFERABILITY OF PLEDGED COLLATERAL................................. 21
SECTION 4.4. OTHER FINANCING STATEMENTS............................................................... 21
SECTION 4.5. CHANGE OF NAME; JURISDICTION OF ORGANIZATION............................................. 22
SECTION 4.6. LOCATION OF INVENTORY AND EQUIPMENT...................................................... 22
SECTION 4.7. DUE AUTHORIZATION AND ISSUANCE........................................................... 22
SECTION 4.8. CONSENTS, ETC............................................................................ 22
SECTION 4.9. PLEDGED COLLATERAL....................................................................... 23
SECTION 4.10. INSURANCE................................................................................ 23
SECTION 4.11. PAYMENT OF TAXES; COMPLIANCE WITH LAWS; CONTESTING LIENS; CLAIMS......................... 23
SECTION 4.12. ACCESS TO PLEDGED COLLATERAL, BOOKS AND RECORDS; OTHER INFORMATION....................... 23
ARTICLE V
CERTAIN PROVISIONS CONCERNING SECURITIES COLLATERAL
SECTION 5.1. PLEDGE OF ADDITIONAL SECURITIES COLLATERAL............................................... 24
SECTION 5.2. VOTING RIGHTS; DISTRIBUTIONS; ETC........................................................ 24
SECTION 5.3. DEFAULTS, ETC............................................................................ 25
SECTION 5.4. CERTAIN AGREEMENTS OF PLEDGORS AS ISSUERS AND HOLDERS OF EQUITY INTERESTS................ 26
ARTICLE VI
CERTAIN PROVISIONS CONCERNING INTELLECTUAL
PROPERTY COLLATERAL
SECTION 6.1. GRANT OF LICENSE......................................................................... 26
SECTION 6.2. PROTECTION OF COLLATERAL AGENT'S SECURITY................................................ 26
SECTION 6.3. AFTER-ACQUIRED PROPERTY.................................................................. 27
SECTION 6.4. LITIGATION............................................................................... 28
ARTICLE VII
CERTAIN PROVISIONS CONCERNING ACCOUNTS
SECTION 7.1. MAINTENANCE OF RECORDS................................................................... 28
SECTION 7.2. LEGEND................................................................................... 29
SECTION 7.3. MODIFICATION OF TERMS, ETC............................................................... 29
SECTION 7.4. COLLECTION............................................................................... 29
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ARTICLE VIII
TRANSFERS
SECTION 8.1. TRANSFERS OF PLEDGED COLLATERAL.......................................................... 30
ARTICLE IX
REMEDIES
SECTION 9.1. REMEDIES................................................................................. 30
SECTION 9.2. NOTICE OF SALE........................................................................... 32
SECTION 9.3. WAIVER OF NOTICE AND CLAIMS.............................................................. 32
SECTION 9.4. CERTAIN SALES OF PLEDGED COLLATERAL...................................................... 32
SECTION 9.5. NO WAIVER; CUMULATIVE REMEDIES........................................................... 33
SECTION 9.6. CERTAIN ADDITIONAL ACTIONS REGARDING INTELLECTUAL PROPERTY............................... 34
ARTICLE X
PROCEEDS OF CASUALTY EVENTS AND COLLATERAL DISPOSITIONS;
APPLICATION OF PROCEEDS
SECTION 10.1. PROCEEDS OF CASUALTY EVENTS AND COLLATERAL DISPOSITIONS.................................. 34
SECTION 10.2. APPLICATION OF PROCEEDS.................................................................. 34
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. CONCERNING COLLATERAL AGENT.............................................................. 35
SECTION 11.2. COLLATERAL AGENT MAY PERFORM; COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT................ 36
SECTION 11.3. CONTINUING SECURITY INTEREST; ASSIGNMENT................................................. 36
SECTION 11.4. TERMINATION; RELEASE..................................................................... 37
SECTION 11.5. MODIFICATION IN WRITING.................................................................. 37
SECTION 11.6. NOTICES.................................................................................. 37
SECTION 11.7. GOVERNING LAW, CONSENT TO JURISDICTION AND SERVICE OF PROCESS; WAIVER OF
JURY TRIAL............................................................................ 37
SECTION 11.8. SEVERABILITY OF PROVISIONS............................................................... 38
SECTION 11.9. EXECUTION IN COUNTERPARTS................................................................ 38
SECTION 11.10. BUSINESS DAYS............................................................................ 39
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SECTION 11.11. WAIVER OF STAY........................................................................... 39
SECTION 11.12. NO CREDIT FOR PAYMENT OF TAXES OR IMPOSITION............................................. 39
SECTION 11.13. NO CLAIMS AGAINST COLLATERAL AGENT....................................................... 39
SECTION 11.14. NO RELEASE............................................................................... 39
SECTION 11.15. OBLIGATIONS ABSOLUTE..................................................................... 40
SIGNATURES................................................................................................. S-1
EXHIBIT 1 Form of Issuer's Acknowledgment
EXHIBIT 2 Form Pledge Amendment
EXHIBIT 3 Form of Joinder Agreement
EXHIBIT 4 Form of Control Agreement Concerning Securities Accounts
EXHIBIT 5 Form of Control Agreement Concerning Deposit Accounts
EXHIBIT 6 Form of Copyright Security Agreement
EXHIBIT 7 Form of Patent Security Agreement
EXHIBIT 8 Form of Trademark Security Agreement
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SECURITY AGREEMENT
SECURITY AGREEMENT dated as of September 30, 2004 (as amended,
amended and restated, supplemented or otherwise modified from time to time in
accordance with the provisions hereof, the "Agreement"), among ICG, LLC, a
Delaware limited liability company (the "Borrower") and THE GUARANTORS LISTED ON
THE SIGNATURE PAGES HERETO (the "Original Guarantors") OR FROM TIME TO TIME
PARTY HERETO BY EXECUTION OF A JOINDER AGREEMENT (the "Additional Guarantors,"
and together with the Original Guarantors, the "Guarantors"), as pledgors,
assignors and debtors (the Borrower, together with the Guarantors, in such
capacities and together with any successors in such capacities, the "Pledgors,"
and each, a "Pledgor"), in favor of UBS AG, STAMFORD BRANCH, in its capacity as
collateral agent pursuant to the Credit Agreement (such term and each other
capitalized term used but not defined herein having the meaning given to it in
Article I), as pledgee, assignee and secured party (in such capacities and
together with any successors in such capacities, the "Collateral Agent").
R E C I T A L S :
A. The Borrower, the Original Guarantors, the lending
institutions listed therein (the "Lenders"), UBS Securities LLC, as lead
arranger and as syndication agent, General Electric Capital Corporation as
documentation agent, UBS Loan Finance LLC, as swingline lender, and UBS AG,
Stamford Branch, as issuing bank, as administrative agent for the Lenders and as
collateral agent for the Secured Parties have, in connection with the execution
and delivery of this Agreement, entered into that certain credit agreement,
dated as of September 30, 2004 (as amended, amended and restated, supplemented
or otherwise modified from time to time, the "Credit Agreement").
B. Each Original Guarantor has, pursuant to the Credit Agreement,
unconditionally guaranteed the Obligations.
C. The Borrower and each Original Guarantor will receive
substantial benefits from the execution, delivery and performance of the
obligations under the Credit Agreement and the other Loan Documents and each is,
therefore, willing to enter into this Agreement.
D. Each Pledgor is or, as to Pledged Collateral acquired by such
Pledgor after the date hereof will be, the legal and/or beneficial owner of the
Pledged Collateral pledged by it hereunder.
E. This Agreement is given by each Pledgor in favor of the
Collateral Agent for the benefit of the Secured Parties to secure the payment
and performance of all of the Obligations.
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F. It is a condition to the obligations of the Lenders to make
the Loans under the Credit Agreement and a condition to the Issuing Bank issuing
Letters of Credit under the Credit Agreement that each Pledgor execute and
deliver the applicable Loan Documents, including this Agreement.
A G R E E M E N T :
NOW THEREFORE, in consideration of the foregoing premises and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each Pledgor and the Collateral Agent hereby agree as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1. Definitions.
(a) Unless otherwise defined herein or in the Credit Agreement,
capitalized terms used herein that are defined in the UCC shall have the
meanings assigned to them in the UCC.
(b) Terms used but not otherwise defined herein that are defined
in the Credit Agreement shall have the meanings given to them in the Credit
Agreement. Sections 1.03 and 1.05 of the Credit Agreement shall apply herein
mutatis mutandis, as if a part hereof.
(c) The following terms shall have the following meanings:
"Acquisition Document Rights" shall mean, with respect to each
Pledgor, collectively, all of such Pledgor's right, title and interest in, to
and under the Acquisition Documents, including (i) all rights and remedies
relating to monetary damages, including indemnification rights and remedies, and
claims for damages or other relief pursuant to or in respect of the Acquisition
Documents, (ii) all rights and remedies relating to monetary damages, including
indemnification rights and remedies, and claims for monetary damages under or in
respect of the agreements, documents and instruments referred to in the
Acquisition Documents or related thereto and (iii) all proceeds, collections,
recoveries and rights of subrogation with respect to the foregoing.
"Additional Guarantors" shall have the meaning assigned to such term
in the Preamble hereof.
"Additional Pledged Interests" shall mean, collectively, with
respect to each Pledgor, all of its right, title and interest in (i) all
options, warrants, rights, agreements, additional
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membership, partnership or other equity interests of whatever class of any
issuer of Initial Pledged Interests or any other equity interest in any such
issuer, together with all rights, privileges, authority and powers of such
Pledgor relating to such equity interests in each such issuer or under any
Organizational Document of any such issuer, and the certificates, instruments
and agreements representing such membership, partnership or other equity
interests and any and all interest of such Pledgor in the entries on the books
of any financial intermediary pertaining to such membership, partnership or
other equity interests from time to time acquired by such Pledgor in any manner
and (ii) all membership, partnership or other equity interests, as applicable,
of each limited liability company, partnership or other entity (other than a
corporation) hereafter acquired or formed by such Pledgor and all options,
warrants, rights, agreements, additional membership, partnership or other equity
interests of whatever class of such limited liability company, partnership or
other entity, together with all rights, privileges, authority and powers of such
Pledgor relating to such equity interests or under any Organizational Document
of any such issuer, and the certificates, instruments and agreements
representing such membership, partnership or other equity interests and any and
all interest of such Pledgor in the entries on the books of any financial
intermediary pertaining to such membership, partnership or other equity
interests, from time to time acquired by such Pledgor in any manner.
"Additional Pledged Shares" shall mean, collectively, with respect
to each Pledgor, all of its right, title and interest in (i) all options,
warrants, rights, agreements, additional shares of capital stock of whatever
class of any issuer of the Initial Pledged Shares or any other equity interest
in any such issuer, together with all rights, privileges, authority and powers
of such Pledgor relating to such equity interests issued by any such issuer
under any Organizational Document of any such issuer, and the certificates,
instruments and agreements representing such equity interests and any and all
interest of such Pledgor in the entries on the books of any financial
intermediary pertaining to such equity interests, from time to time acquired by
such Pledgor in any manner and (ii) all the issued and outstanding shares of
capital stock of each corporation hereafter acquired or formed by such Pledgor
and all options, warrants, rights, agreements or additional shares of capital
stock of whatever class of such corporation, together with all rights,
privileges, authority and powers of such Pledgor relating to such shares or
under any Organizational Document of such corporation, and the certificates,
instruments and agreements representing such shares and any and all interest of
such Pledgor in the entries on the books of any financial intermediary
pertaining to such shares, from time to time acquired by such Pledgor in any
manner.
"Agreement" shall have the meaning assigned to such term in the
Preamble hereof.
"Borrower" shall have the meaning assigned to such term in the
Preamble hereof.
"Claims" shall mean any and all property and other taxes,
assessments and special assessments, levies, fees and all governmental charges
imposed upon or assessed against, and landlords', carriers', mechanics',
workmen's, repairmen's, laborers', materialmen's, suppliers'
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and warehousemen's Liens and other claims arising by operation of law against,
all or any portion of the Pledged Collateral.
"Collateral Agent" shall have the meaning assigned to such term in
the Preamble hereof.
"Commodity Account Control Agreement" shall mean an agreement
establishing the "control" over all commodity contracts credited to a
commodities account in a form that is reasonably satisfactory to the
Administrative Agent.
"Contested Liens" shall mean, collectively, any Liens incurred in
respect of any Claims to the extent that the amounts owing in respect thereof
are not yet delinquent or are being contested and otherwise comply with the
provisions of Section 4.11 hereof; provided, however, that such Liens shall in
all respects be subject and subordinate in priority to the Lien and security
interest created by this Agreement, except if and to the extent that the law or
regulation creating, permitting or authorizing such Lien provides that such Lien
is or is required to be superior to the Lien and security interest created and
evidenced hereby.
"Contracts" shall mean, collectively, with respect to each Pledgor,
all sale, service, performance, equipment or property lease contracts,
agreements or instruments and all other contracts, agreements or instruments (in
each case, whether written, electronic or oral, or third party or intercompany),
between such Pledgor and any other person, and all assignments, amendments,
restatements, supplements, extensions, renewals, replacements or modifications
thereof, and all rights of Pledgor thereunder.
"Control" shall mean (i) in the case of each Deposit Account,
"control," as such term is defined in Section 9-104 of the UCC, (ii) in the case
of any Security Entitlement, "control," as such term is defined in Section
8-106(d) of the UCC and (iii) in the case of any Commodity Contract, "control,"
as such term is defined in Section 9-106(b) of the UCC.
"Control Agreements" shall mean, collectively, any Deposit Account
Control Agreements, any Securities Account Control Agreements and any Commodity
Account Control Agreements.
"Controlled Account" means a Deposit Account, Securities Account or
Commodity Account over which the Collateral Agent has Control.
"Copyrights" shall mean, collectively, with respect to each Pledgor,
all copyrights (whether statutory or common law, whether established or
registered in the United States or any other country or group of countries or
any political subdivision thereof, whether registered or unregistered and
whether published or unpublished) and all copyright registrations and
applications made by such Pledgor, in each case, whether now owned or hereafter
created or acquired by or assigned to such Pledgor, together with any and all
(i) rights and privileges arising under applicable law with respect to such
Pledgor's use of such copyrights, (ii) reissues,
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renewals, continuations and extensions thereof, (iii) income, fees, royalties,
damages, claims and payments now or hereafter due and/or payable with respect
thereto, including damages and payments for past, present or future
infringements thereof, (iv) rights corresponding thereto throughout the world
and (v) rights to ▇▇▇ for past, present or future infringements thereof.
"Copyright Security Agreement" shall mean an agreement substantially
in the form annexed hereto as Exhibit 6.
"Credit Agreement" shall have the meaning assigned to such term in
Recital A hereof.
"Deposit Account Control Agreement" shall mean an agreement
substantially in the form annexed hereto as Exhibit 5 or such other form that is
reasonably satisfactory to the Collateral Agent.
"Deposit Accounts" shall mean, collectively, with respect to each
Pledgor, (i) all "deposit accounts" as such term is defined in the UCC and (ii)
all cash, funds, checks, notes and instruments from time to time on deposit in
any of the accounts or sub-accounts described in clause (i) of this definition.
"Distributions" shall mean, collectively, with respect to each
Pledgor, all dividends, cash, options, warrants, rights, instruments,
distributions, returns of capital or principal, income, interest, profits and
other property, interests (debt or equity) or proceeds, including as a result of
a split, revision, reclassification or other like change of the Pledged
Securities, from time to time received, receivable or otherwise distributed to
such Pledgor in respect of or in exchange for any or all of the Pledged
Securities or Intercompany Notes.
"Excluded Account" shall mean any Deposit Account that has less than
$10,000 of cash on deposit therein so long as the aggregate amount of all such
Deposit Accounts with less than $10,000 on deposit therein that constitute
Excluded Accounts is less than $100,000.
"Excluded Property" shall mean (i) Special Property other than any
Proceeds, substitutions or replacements of any Special Property (unless such
Proceeds, substitutions or replacements would constitute Special Property) and
(ii) Special Equity Interests other than any Proceeds, substitutions or
replacements of any Special Equity Interests (unless such Proceeds,
substitutions or replacements would constitute Special Equity Interests).
"General Intangibles" shall mean, collectively, with respect to each
Pledgor, all "general intangibles," as such term is defined in the UCC, and, in
any event, shall include (i) all of such Pledgor's right, title and interest in,
to and under all insurance policies and Contracts, (ii) all know-how and
warranties relating to any of the Pledged Collateral or the Mortgaged Property,
(iii) any and all other rights, claims, choses-in-action and causes of action of
such Pledgor against any other person (other than any of the foregoing
constituting Accounts, Documents, Chattel Paper, Instruments, Letter of Credit
Rights, Investment Property or other
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types of Pledged Collateral) and the benefits of any and all collateral or other
security given by any other person in connection therewith, (iv) all guarantees,
endorsements and indemnifications on, or of, any of the Pledged Collateral or
any of the Mortgaged Property, (v) all lists, books, records, correspondence,
ledgers, printouts, files (whether in printed form or stored electronically),
tapes and other papers or materials containing information relating to any of
the Pledged Collateral or any of the Mortgaged Property, including all customer
or tenant lists, identification of suppliers, data, plans, blueprints,
specifications, designs, drawings, appraisals, recorded knowledge, surveys,
studies, engineering reports, test reports, manuals, standards, processing
standards, performance standards, catalogs, research data, computer and
automatic machinery software and programs and the like, field repair data,
accounting information pertaining to such Pledgor's operations or any of the
Pledged Collateral or any of the Mortgaged Property and all media in which or on
which any of the information or knowledge or data or records may be recorded or
stored and all computer programs used for the compilation or printout of such
information, knowledge, records or data, (vi) all licenses, consents, permits,
variances, certifications, authorizations and approvals, however characterized,
of any Governmental Authority (or any person acting on behalf of a Governmental
Authority) now or hereafter acquired or held by such Pledgor pertaining to
operations now or hereafter conducted by such Pledgor or any of the Pledged
Collateral or any of the Mortgaged Property including building permits,
certificates of occupancy, environmental certificates, industrial permits or
licenses and certificates of operation and (vii) all rights to reserves,
deferred payments, deposits, refunds, indemnification of claims to the extent
the foregoing relate to any Pledged Collateral or Mortgaged Property and claims
for tax or other refunds against any Governmental Authority relating to any
Pledged Collateral or any of the Mortgaged Property.
"Goodwill" shall mean, collectively, with respect to each Pledgor,
the goodwill connected with such Pledgor's business including (i) all goodwill
connected with the use of and symbolized by any Trademark or Trademark License
in which such Pledgor has any interest, (ii) all know-how, trade secrets,
customer and supplier lists, proprietary information, inventions, methods,
procedures, formulae, descriptions, compositions, technical data, drawings,
specifications, name plates, catalogs, confidential information and the right to
limit the use or disclosure thereof by any person, pricing and cost information,
business and marketing plans and proposals, consulting agreements, engineering
contracts and such other assets which relate to such goodwill and (iii) all
product lines of such Pledgor's business.
"Guarantors" shall have the meaning assigned to such term in the
Preamble hereof.
"Initial Pledged Interests" shall mean, with respect to each
Pledgor, all of its right, title and interest in all membership, partnership or
other equity interests (other than in a corporation), as applicable, of each
issuer described in Schedule 10 annexed to the Perfection Certificate, together
with all rights, privileges, authority and powers of such Pledgor in and to each
such issuer or under any Organizational Document of each such issuer, and the
certificates, instruments and agreements representing such membership,
partnership or other equity interests
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and any and all interest of such Pledgor in the entries on the books of any
financial intermediary pertaining to such membership, partnership or other
equity interests.
"Initial Pledged Shares" shall mean, collectively, with respect to
each Pledgor, all of its right, title and interest in the issued and outstanding
shares of capital stock of each issuer that is a corporation described in
Schedule 10 annexed to the Perfection Certificate together with all rights,
privileges, authority and powers of such Pledgor relating to such shares of
capital stock interests in each such issuer or under any Organizational Document
of each such issuer, and the certificates, instruments and agreements
representing such shares of capital stock and any and all interest of such
Pledgor in the entries on the books of any financial intermediary pertaining to
the Initial Pledged Shares.
"Instruments" shall mean, collectively, with respect to each
Pledgor, all "instruments," as such term is defined in Article 9, rather than
Article 3, of the UCC, and shall include all promissory notes, drafts, bills of
exchange or acceptances.
"Intellectual Property Collateral" shall mean, collectively, the
Patents, Trademarks, Copyrights, Licenses, Goodwill and all other items
designated as Intellectual Property under Section 3.06 of the Credit Agreement.
"Intercompany Notes" shall mean, with respect to each Pledgor, all
intercompany notes described in Schedule 11 annexed to the Perfection
Certificate and all other notes hereafter acquired by such Pledgor from any
other Company and all certificates, instruments or agreements evidencing such
notes payable by any other Company to Pledgor, and all assignments, amendments,
restatements, supplements, extensions, renewals, replacements or modifications
thereof to the extent permitted pursuant to the terms hereof.
"Investment Property" shall mean a security, whether certificated or
uncertificated, Security Entitlement, Securities Account, Commodity Contract or
Commodity Account, excluding, however, the Securities Collateral.
"Joinder Agreement" shall mean an agreement substantially in the
form annexed hereto as Exhibit 3.
"Land Pledgor" shall mean any Pledgor that owns the equity interests
in a Land Company.
"Lenders" shall have the meaning assigned to such term in Recital A
hereof.
"Licenses" shall mean, collectively, with respect to each Pledgor,
all license and distribution agreements with, and covenants not to ▇▇▇, any
other party with respect to any Patent, Trademark or Copyright or any other
patent, trademark or copyright, whether such Pledgor is a licensor or licensee,
distributor or distributee under any such license or distribution agreement,
together with any and all (i) renewals, extensions, supplements and
continuations thereof, (ii) income, fees, royalties, damages, claims and
payments now and hereafter due and/or
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payable thereunder and with respect thereto including damages and payments for
past, present or future infringements or violations thereof, (iii) rights to ▇▇▇
for past, present and future infringements or violations thereof and (iv) other
rights to use, exploit or practice any or all of the Patents, Trademarks or
Copyrights or any other patent, trademark or copyright.
"Original Guarantors" shall have the meaning assigned to such term
in the Preamble hereof.
"Patents" shall mean, collectively, with respect to each Pledgor,
all patents issued or assigned to and all patent applications and registrations
made by such Pledgor (whether established or registered or recorded in the
United States or any other country or group of countries or any political
subdivision thereof), together with any and all (i) rights and privileges
arising under applicable law with respect to such Pledgor's use of any patents,
(ii) inventions and improvements described and claimed therein, (iii) reissues,
divisions, continuations, renewals, extensions and continuations-in-part
thereof, (iv) income, fees, royalties, damages, claims and payments now or
hereafter due and/or payable thereunder and with respect thereto including
damages and payments for past, present or future infringements thereof, (v)
rights corresponding thereto throughout the world and (vi) rights to ▇▇▇ for
past, present or future infringements thereof.
"Patent Security Agreement" shall mean an agreement substantially in
the form annexed hereto as Exhibit 7.
"Perfection Certificate" shall mean, with respect to any Pledgor on
the date hereof, that certain perfection certificate dated as of September 30,
2004, executed and delivered by such Pledgor in favor of the Collateral Agent
for the benefit of the Secured Parties, or, with respect to any Pledgor
executing a Joinder Agreement after the date hereof, the Perfection Certificate
(which shall be in form and substance reasonably acceptable to the Collateral
Agent) executed and delivered by such Pledgor, in favor of the Collateral Agent
for the benefit of the Secured Parties contemporaneously with the execution and
delivery by such Pledgor of its Joinder Agreement executed in accordance with
Section 3.5 hereof, in each case, as such certificate may be amended, amended
and restated, supplemented or otherwise modified from time to time in accordance
with the Credit Agreement.
"Pledge Amendment" shall have the meaning assigned to such term in
Section 5.1 hereof.
"Pledged Collateral" shall have the meaning assigned to such term in
Section 2.1 hereof.
"Pledged Interests" shall mean, collectively, the Initial Pledged
Interests and the Additional Pledged Interests; provided, however, that Pledged
Interests shall not include any equity interest which is not required to be
pledged pursuant to Section 5.12(b) of the Credit Agreement.
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"Pledged Securities" shall mean, collectively, the Pledged
Interests, the Pledged Shares and the Successor Interests.
"Pledged Shares" shall mean, collectively, the Initial Pledged
Shares and the Additional Pledged Shares; provided, however, that Pledged Shares
shall not include any shares which are not required to be pledged pursuant to
Section 5.12(b) of the Credit Agreement.
"Pledgor" shall have the meaning assigned to such term in the
Preamble hereof.
"Securities Account Control Agreement" shall mean an agreement
substantially in the form annexed hereto as Exhibit 4 or such other form that is
reasonably satisfactory to the Collateral Agent.
"Securities Collateral" shall mean, collectively, the Pledged
Securities, the Intercompany Notes and the Distributions.
"Special Equity Interests" shall mean, with respect to each Land
Pledgor, all of such Land Pledgor's right title and interest in all membership
interests of its Land Company, together with all rights, privileges, authority
and powers of such Land Pledgor in and to such Land Company or under any
Organizational Document of such Land Company, and the certificates, instruments
and agreements representing such membership interests and any and all interest
of such Land Pledgor in the entries on the books of any financial intermediary
pertaining to such membership interests; provided, however, that such property
shall constitute "Special Equity Interests" only to the extent and for so long
as any lease or other agreement to which such Land Company is a party validly
prohibits or invalidates, directly or indirectly, the creation, attachment,
perfection or enforcement of a Lien on such property in favor of the Collateral
Agent or provides that the creation, attachment or perfection of such Lien gives
rise to a default, breach, termination, right of termination or other remedy
thereunder, and, upon the termination of such prohibition or invalidating
provision, such property shall cease to constitute "Special Equity Interests."
"Special Property" shall mean:
(a) any permit, lease, sublease, contract, license, sublicense or
other general intangible, in each case pertaining to real or personal
property, held by any Pledgor that validly prohibits the creation by such
Pledgor of a Lien thereon;
(b) any permit, lease, sublease, contract, license, sublicense or
other general intangible, in each case pertaining to real or personal
property, held by any Pledgor to the extent that any Requirement of Law
applicable thereto prohibits the creation of a Lien thereon; and
(c) Equipment owned by any Pledgor on the date hereof or hereafter
acquired that is subject to a Lien securing a Purchase Money Obligation or
Capital Lease Obligation permitted to be incurred pursuant to the
provisions of the Credit Agreement if
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the contract or other agreement in which such Lien is granted (or the
documentation providing for such Purchase Money Obligation or Capital
Lease Obligation) validly prohibits the creation of any other Lien on such
Equipment;
provided, however, that in each case described in clauses (a), (b) and (c) of
this definition, such property shall constitute "Special Property" only to the
extent and for so long as such permit, lease, sublease, contract, license,
sublicense or other general intangible, in each case pertaining to real or
personal property, or Requirement of Law applicable thereto validly prohibits
the creation of a Lien on such property in favor of the Collateral Agent and,
upon the termination of such prohibition (howsoever occurring), such property
shall cease to constitute "Special Property." For the avoidance of doubt, no
permit, lease, sublease, contract, license, sublicense or other general
intangible, in each case pertaining to real or personal property (or any right
under any of the foregoing), shall constitute Special Property to the extent
that any such prohibition or Requirement of Law would be ineffective pursuant to
Sections 9-406, 9-407, 9-408 or 9-409 of the Uniform Commercial Code in any
applicable jurisdiction or under any other applicable law or principle of equity
to (x) impair the creation, attachment or perfection of the security interest of
the Collateral Agent in any such permit, lease, sublease, contract, license,
sublicense or other general intangible, in each case pertaining to real or
personal property (or in any right under any of the foregoing) and (y) provide
that the creation , attachment or perfection of the Lien may give rise to a
default, breach, right of recoupment, claim, defense, termination, right of
termination or remedy under such permit, lease, sublease, contract, license,
sublicense or other general intangible, in each case pertaining to real or
personal property (or in any right under any of the foregoing).
"Successor Interests" shall mean, collectively, with respect to each
Pledgor, all shares of each class of the capital stock of the successor
corporation or equity interests (and any certificates evidencing such equity
interests) of the successor limited liability company, partnership or other
entity owned by such Pledgor (unless such successor is such Pledgor itself)
formed by or resulting from any consolidation or merger in which any person
listed in Schedule 1(a) annexed to the Perfection Certificate is not the
surviving entity; provided, however, that Successor Interest shall not include
any shares or equity interests which are not required to be pledged pursuant to
Section 5.12(b) of the Credit Agreement.
"Termination Date" shall mean, the date on which the Commitments
have been terminated and the principal of and interest on each Loan, all Fees
and all other expenses or amounts payable under any Loan Document shall have
been paid in full, all Letters of Credit have been canceled or have expired or
have been fully cash collateralized on terms reasonably acceptable to the
Administrative Agent and all amounts drawn thereunder have been reimbursed in
full and all Credit-Linked Deposits have been returned in full to the Funded LC
Lenders.
"Trademarks" shall mean, collectively, with respect to each Pledgor,
all trademarks (including service marks), slogans, logos, certification marks,
trade dress, uniform resource locations (URL's), domain names, corporate names
and trade names, whether registered or unregistered, owned by or assigned to
such Pledgor and all registrations and applications for
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the foregoing (whether statutory or common law and whether established or
registered in the United States or any other country or group of countries or
any political subdivision thereof), together with any and all (i) rights and
privileges arising under applicable law with respect to such Pledgor's use of
any trademarks, (ii) reissues, continuations, extensions and renewals thereof,
(iii) income, fees, royalties, damages and payments now and hereafter due and/or
payable thereunder and with respect thereto, including damages, claims and
payments for past, present or future infringements thereof, (iv) rights
corresponding thereto throughout the world and (v) rights to ▇▇▇ for past,
present and future infringements thereof.
"Trademark Security Agreement" shall mean an agreement substantially
in the form annexed hereto as Exhibit 8.
"UCC" shall mean the Uniform Commercial Code as in effect on the
date hereof in the State of New York; provided, however, that if by reason of
mandatory provisions of law, any or all of the attachment, perfection or
priority of the Collateral Agent's and the other Secured Parties' security
interest in any item or portion of the Pledged Collateral is governed by the
Uniform Commercial Code as in effect in a jurisdiction other than the State of
New York, the term "UCC" shall mean the Uniform Commercial Code as in effect on
the date hereof in such other jurisdiction for purposes of the provisions hereof
relating to such attachment, perfection or priority and for purposes of
definitions relating to such provisions.
SECTION 1.2. Interpretation. The rules of interpretation specified
in the Credit Agreement (including Section 1.03 thereof) shall be applicable to
this Agreement. If any conflict or inconsistency exists between this Agreement
and the Credit Agreement, the Credit Agreement shall govern.
SECTION 1.3. Resolution of Drafting Ambiguities. Each Pledgor
acknowledges and agrees that it was represented by counsel in connection with
the execution and delivery hereof, that it and its counsel reviewed and
participated in the preparation and negotiation hereof and that any rule of
construction to the effect that ambiguities are to be resolved against the
drafting party (i.e., the Collateral Agent) shall not be employed in the
interpretation hereof.
SECTION 1.4. Perfection Certificate. The Collateral Agent and each
other Secured Party agree that the Perfection Certificate and all descriptions
of Pledged Collateral and all schedules, and all amendments and supplements
thereto, are and shall at all times remain a part of this Agreement.
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ARTICLE II
GRANT OF SECURITY AND SECURED OBLIGATIONS
SECTION 2.1. Grant of Security Interest. As collateral security for
the payment and performance in full of all the Obligations, each Pledgor hereby
pledges and grants to the Collateral Agent for the benefit of the Secured
Parties, a lien on and security interest in and to all of the right, title and
interest of such Pledgor in, to and under the following property, wherever
located, whether now existing or hereafter arising or acquired from time to time
(collectively, the "Pledged Collateral"):
(i) all Accounts;
(ii) all As-Extracted Collateral;
(iii) all Equipment, Goods, Inventory and Fixtures;
(iv) all Documents, Instruments and Chattel Paper;
(v) all Letters of Credit and Letter-of-Credit Rights;
(vi) all Securities Collateral;
(vii) all Collateral Accounts;
(viii) all Investment Property;
(ix) all Intellectual Property Collateral;
(x) the Commercial Tort Claims described on Schedule 14 to the
Perfection Certificate;
(xi) all General Intangibles;
(xii) all Deposit Accounts and Money;
(xiii) all Acquisition Documents and Acquisition Document Rights;
(xiv) all Supporting Obligations;
(xv) all books and records relating to the Pledged Collateral;
(xvi) to the extent not otherwise included in clause (ii) above,
all coal and other minerals severed or extracted from the
ground of the Grantor (including all severed or extracted
coal purchased, acquired or obtained from other
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persons), and all Accounts, General Intangibles and
products and Proceeds thereof or related thereto,
regardless of whether any such coal or other minerals are
in raw form or processed for sale and regardless of
whether or not any Grantor had an interest in the coal or
other minerals before extraction or severance;
(xvii) to the extent not covered by clauses (i) through (xvi) of
this sentence, all other personal property of such
Pledgor, whether tangible or intangible; and
(xviii) all Proceeds and products of each of the foregoing and all
accessions to, substitutions and replacements for, and
rents, profits and products of, each of the foregoing, and
any and all Proceeds of any insurance, indemnity, warranty
or guaranty payable to such Pledgor from time to time with
respect to any of the foregoing.
Notwithstanding anything to the contrary contained in clauses (i)
through (xviii) above, the security interest created by this Agreement shall not
extend to, and the term "Pledged Collateral" shall not include, any Excluded
Property and (i) the Pledgors shall from time to time at the reasonable request
of the Collateral Agent give written notice to the Collateral Agent identifying
in reasonable detail any material item of Special Property (and stating in such
notice that such Special Property constitutes "Excluded Property") and shall
provide to the Collateral Agent such other information regarding the Special
Property as the Collateral Agent may reasonably request and (ii) from and after
the Closing Date, no Pledgor shall permit to become effective in any document
creating, governing or providing for any permit, lease, contract or license, a
provision that would prohibit the creation or enforcement of a Lien on such
permit, lease, contract or license, or on the equity interests in such Pledgor
or any other Company, in favor of the Collateral Agent; provided that this
clause (ii) shall not apply to any such document if management of such Pledgor
reasonably determines in good faith that eliminating such provision would (x)
have a material adverse effect on such document or on such Pledgor's
relationship with the party or parties to such document, (y) require the payment
of any money or the making by such Pledgor of any material concession under such
document in exchange for not including such provision, or (z) otherwise
materially and adversely effect such Pledgor; provided, however, that,
notwithstanding the foregoing or any other provision in the Loan Documents, (a)
on or prior to the Post Closing Action Completion Date, no Company shall renew
or replace any Lease, contract or other agreement that is not a Subsidiary
Change of Control Agreement with a Lease, contract or other agreement that is a
Subsidiary Change of Control Agreement, (b) after the Post Closing Action
Completion Date, no Company shall enter into any Subsidiary Change of Control
Agreement unless, after giving effect thereto, the aggregate amount (in tons) of
Coal reserves included in the Collateral is at least equal to the Minimum
Secured Reserves and (c) at any time, (x) no Company that is not a Land Company
shall enter into a Subsidiary Change of Control Agreement and (y) no Company
other than Holdings shall enter into a Borrower Change of Control Agreement (and
by making Holdings the party thereto the provisions contained therein that make
such agreement a "Borrower Change of
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Control Agreement" must no longer apply to Borrower) unless consented to in
writing by each of the Lenders.
SECTION 2.2. Filings. (a) Each Pledgor hereby irrevocably authorizes
the Collateral Agent at any time and from time to time to file in any relevant
jurisdiction any initial financing statements (including fixture filings) and
amendments thereto that contain the information required by Article 9 of the
Uniform Commercial Code of each applicable jurisdiction for the filing of any
financing statement or amendment relating to the Pledged Collateral, including
(i) whether such Pledgor is an organization, the type of organization and any
organizational identification number issued to such Pledgor, (ii) any financing
or continuation statements or other documents without the signature of such
Pledgor where permitted or required by applicable Requirements of Law, including
the filing of a financing statement describing the Pledged Collateral as "all
assets in which the Pledgor now owns or hereafter acquires rights" and (iii) in
the case of a financing statement filed as a fixture filing or covering Pledged
Collateral constituting minerals or the like to be extracted or timber to be
cut, a sufficient description of the real property to which such Pledged
Collateral relates. Each Pledgor agrees to provide all information described in
the immediately preceding sentence to the Collateral Agent promptly upon
request.
(b) Each Pledgor hereby ratifies its authorization for the
Collateral Agent to file in any relevant jurisdiction any initial financing
statements or amendments thereto relating to the Pledged Collateral if filed
prior to the date hereof.
(c) Each Pledgor hereby further authorizes the Collateral Agent to
file filings with, if applicable, the United States Patent and Trademark Office
and the United States Copyright Office (or any successor office or any similar
office in any other country or group of countries), including this Agreement,
the Copyright Security Agreement, the Patent Security Agreement and the
Trademark Security Agreement, as applicable, or other documents for the purpose
of perfecting, confirming, continuing, enforcing or protecting the security
interest granted by such Pledgor hereunder, without the signature of such
Pledgor where allowed or required by applicable Requirements of Law, and naming
such Pledgor, as debtor, and the Collateral Agent, as secured party.
ARTICLE III
PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES;
USE OF PLEDGED COLLATERAL
SECTION 3.1. Delivery of Certificated Securities Collateral. Each
Pledgor represents and warrants that all certificates, agreements or instruments
representing or evidencing the Securities Collateral in existence on the date
hereof have been delivered to the
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Collateral Agent in suitable form for transfer by delivery or accompanied by
duly executed instruments of transfer or assignment in blank and that the
Collateral Agent has a perfected, first-priority security interest therein. Each
Pledgor hereby agrees that all certificates, agreements or instruments
representing or evidencing Securities Collateral acquired by such Pledgor after
the date hereof shall promptly (but in any event within 5 Business Days) upon
receipt thereof by such Pledgor be delivered to and held by or on behalf of the
Collateral Agent pursuant hereto. All certificated Securities Collateral shall
be in suitable form for transfer by delivery or shall be accompanied by duly
executed instruments of transfer or assignment in blank, all in form and
substance satisfactory to the Collateral Agent. The Collateral Agent shall have
the right, at any time upon the occurrence and during the continuance of any
Event of Default, to endorse, assign or otherwise transfer to or to register in
the name of the Collateral Agent or any of its nominees or endorse for
negotiation any or all of the Securities Collateral, without any indication that
such Securities Collateral is subject to the security interest hereunder. In
addition, upon the occurrence and during the continuance of an Event of Default,
the Collateral Agent shall have the right at any time to exchange certificates
representing or evidencing Securities Collateral for certificates of smaller or
larger denominations.
SECTION 3.2. Perfection of Uncertificated Securities Collateral.
Each Pledgor represents and warrants that the Collateral Agent has a perfected,
first-priority security interest in all uncertificated Pledged Securities
pledged by it hereunder that are in existence on the date hereof. Each Pledgor
hereby agrees that if any of the Pledged Securities (other than Pledged
Securities held as securities entitlements) are at any time not evidenced by
certificates of ownership, then each applicable Pledgor shall, to the extent
permitted by applicable law (i) if necessary or desirable to perfect a security
interest in such Pledged Securities or establish the priority thereof, cause
such pledge to be recorded on the equityholder register or the books of the
issuer, cause the issuer to execute and deliver to the Collateral Agent an
acknowledgment of the pledge of such Pledged Securities substantially in the
form of Exhibit 1 annexed hereto, execute any customary pledge forms or other
documents necessary or appropriate to complete the pledge and give the
Collateral Agent the right to transfer such Pledged Securities under the terms
hereof and, upon request, provide to the Collateral Agent an opinion of counsel,
in form and substance reasonably satisfactory to the Collateral Agent,
confirming such pledge and perfection thereof and (ii) use its commercially
reasonable efforts to cause such Pledged Securities to become certificated and
delivered to the Collateral Agent in accordance with the provisions of Section
3.1.
SECTION 3.3. Financing Statements and Other Filings; Maintenance of
Perfected Security Interest. Each Pledgor represents and warrants that all
filings necessary to perfect the security interest granted hereunder by it to
the Collateral Agent in respect of the Pledged Collateral (including, without
limitation, As-Extracted Collateral) (other than Pledged Collateral in which a
security interest cannot be perfected under the UCC) have been delivered to the
Collateral Agent in completed and, to the extent necessary or appropriate, duly
executed form for filing in each governmental, municipal or other office
specified in Schedule 6 annexed to the Perfection Certificate. Each Pledgor
agrees that at the sole cost and expense of the Pledgors, (i) such Pledgor,
except as otherwise expressly permitted by the Credit Agreement or other
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provisions hereof, will maintain the security interest created by this Agreement
in the Pledged Collateral as a perfected, first-priority security interest and
shall defend such security interest against the claims and demands of all
persons except Permitted Collateral Liens, (ii) such Pledgor shall furnish to
the Collateral Agent from time to time statements and schedules further
identifying and describing the Pledged Collateral and such other reports in
connection with the Pledged Collateral as the Collateral Agent may reasonably
request, all in reasonable detail and (iii) at any time and from time to time,
upon the written request of the Collateral Agent, such Pledgor shall promptly
and duly execute and deliver, and file and have recorded, such further
instruments and documents and take such further action as the Collateral Agent
may reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and the rights and powers herein granted, including
the filing of any financing statements, continuation statements and other
documents (including this Agreement) under the UCC (or other similar laws) in
effect in any jurisdiction with respect to the security interest created hereby
and the execution and delivery of Control Agreements, all in form reasonably
satisfactory to the Collateral Agent and in such offices (including the United
States Patent and Trademark Office and the United States Copyright Office)
wherever required by law to perfect, continue and maintain a valid, enforceable,
first-priority security interest in the Pledged Collateral as provided herein
and to preserve the other rights and interests granted to the Collateral Agent
hereunder, as against third parties, with respect to the Pledged Collateral
subject to Permitted Collateral Liens.
SECTION 3.4. Other Actions. In order to further insure the
attachment, perfection and priority of, and the ability of the Collateral Agent
to enforce, the Collateral Agent's security interest in the Pledged Collateral,
each Pledgor represents and warrants (as to itself) as follows and agrees, in
each case at such Pledgor's own expense, to take the following actions with
respect to the following Pledged Collateral:
(a) Instruments and Tangible Chattel Paper. As of the date hereof,
(i) no amounts individually or in the aggregate in excess of $500,000
payable under or in connection with any of the Pledged Collateral are
evidenced by any Instrument or Tangible Chattel Paper other than such
Instruments and Tangible Chattel Paper listed in Schedule 11 annexed to
the Perfection Certificate and instruments received for deposit or
presentation for collection in the ordinary course of business and (ii)
each Instrument and each item of Tangible Chattel Paper listed in Schedule
11 annexed to the Perfection Certificate has been properly endorsed,
assigned and delivered to the Collateral Agent, accompanied by instruments
of transfer or assignment duly executed in blank. If any amount then
payable under or in connection with any of the Pledged Collateral shall be
evidenced by any Instrument or Tangible Chattel Paper (other than
instruments received for deposit or presentation for collection in the
ordinary course of business), and such amount, together with all amounts
payable evidenced by any Instrument or Tangible Chattel Paper not
previously delivered to the Collateral Agent, exceeds $500,000 in the
aggregate for all Pledgors, the Pledgor acquiring such Instrument or
Tangible Chattel Paper shall promptly and in any event within 3 Business
Days endorse, assign and deliver the same to the Collateral Agent,
accompanied by such instruments of transfer or assignment duly executed in
blank as the Collateral Agent may from time to time specify.
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(b) Deposit Accounts. (i) As of the date hereof, it has neither
opened nor maintains any Deposit Accounts other than the accounts listed
in Schedule 15 annexed to the Perfection Certificate and (ii) the
Collateral Agent has a perfected, first-priority security interest in each
Deposit Account listed in Schedule 15 annexed to the Perfection
Certificate by Control, other than any Excluded Account. No Pledgor shall
hereafter establish and maintain any Deposit Account other than any
Excluded Account unless (1) the applicable Pledgor shall have given the
Collateral Agent 5 Business Days' prior written notice of its intention to
establish such new Deposit Account with a Bank, (2) such Bank shall be
reasonably acceptable to the Collateral Agent and (3) such Bank and such
Pledgor shall have duly executed and delivered to the Collateral Agent a
Deposit Account Control Agreement with respect to such Deposit Account.
The Collateral Agent agrees with each Pledgor that the Collateral Agent
shall not give any instructions directing the disposition of funds from
time to time credited to any Deposit Account or withhold any withdrawal
rights from such Pledgor with respect to funds from time to time credited
to any Deposit Account unless an Event of Default has occurred and is
continuing. The provisions of this Section 3.4(b) shall not apply to the
Collateral Account or to any other Deposit Accounts for which the
Collateral Agent is the Bank, other than the restrictions on the
Collateral Agent's authority with respect to Depost Accounts other than
the Collateral Account. No Pledgor shall grant Control over any Deposit
Account to any person other than the Collateral Agent and the depositary
bank at which such account is maintained.
(c) Investment Property. (i) As of the date hereof, it (1) has no
Securities Accounts or Commodity Accounts other than those listed in
Schedule 15 annexed to the Perfection Certificate and the Collateral Agent
has a perfected first priority security interest in such Securities
Accounts and Commodity Accounts by Control, (2) does not hold, own or have
any interest in any certificated securities or uncertificated securities
other than those constituting Pledged Securities and those maintained in
Securities Accounts or Commodity Accounts listed in Schedule 15 annexed to
the Perfection Certificate and (3) has entered into a duly authorized,
executed and delivered Securities Account Control Agreement or a Commodity
Account Control Agreement with respect to each Securities Account or
Commodity Account listed in Schedule 15 annexed to the Perfection
Certificate, as applicable.
(ii) If any Pledgor shall at any time hold or acquire any
certificated securities constituting Investment Property, other than any
securities of a Foreign Subsidiary not required to be pledged hereunder or
under the Credit Agreement, such Pledgor shall promptly (A) endorse,
assign and deliver the same to the Collateral Agent, accompanied by such
instruments of transfer or assignment duly executed in blank, all in form
and substance reasonably satisfactory to the Collateral Agent or (B)
deliver such securities into a Securities Account with respect to which a
Control Agreement is in effect in favor of the Collateral Agent. If any
securities now or hereafter acquired by any Pledgor constituting
Investment Property, other than any securities of a Foreign Subsidiary not
required to be pledged hereunder or under the Credit Agreement, are
uncertificated and
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are issued to such Pledgor or its nominee directly by the issuer thereof,
such Pledgor shall promptly notify the Collateral Agent thereof and
pursuant to an agreement in form and substance satisfactory to the
Collateral Agent, either (x) cause the issuer to agree to comply with
instructions from the Collateral Agent as to such securities, without
further consent of any Pledgor or such nominee, (y) cause a Security
Entitlement with respect to such uncertificated security to be held in a
Securities Account with respect to which the Collateral Agent has Control
or (z) arrange for the Collateral Agent to become the registered owner of
the securities. Except as expressly permitted under the Credit Agreement,
no Pledgor shall hereafter establish and maintain any Securities Account
or Commodity Account with any Securities Intermediary or Commodity
Intermediary or enter into any Commodity Contract unless (1) the
applicable Pledgor shall have given the Collateral Agent 5 Business Days'
prior written notice of its intention to establish such new Securities
Account or Commodity Account with such Securities Intermediary or
Commodity Intermediary or to enter into such Commodity Contract, (2) in
the case of a Securities Account or Commodities Account, such Securities
Intermediary or Commodity Intermediary shall be reasonably acceptable to
the Collateral Agent and (3) such Securities Intermediary or Commodity
Intermediary, as the case may be, and such Pledgor shall have duly
executed and delivered a Control Agreement with respect to such Securities
Account or Commodity Account, as the case may be, or in the case of a
Commodity Contract, shall have caused such Commodity Contract to be
credited to a Commodity Account satisfying the requirements of this
Section 3.4(c). Each Pledgor shall accept any cash and Investment Property
that are proceeds of the pledged Investment Property in trust for the
benefit of the Collateral Agent and within 5 Business Days of actual
receipt thereof, deposit any cash or Investment Property and any new
securities, instruments, documents or other property by reason of
ownership of the Investment Property (other than payments of a kind
described in Section 7.4 hereof) received by it into a Controlled Account.
The Collateral Agent agrees with each Pledgor that the Collateral Agent
shall not give any Entitlement Orders or instructions or directions to any
issuer of uncertificated securities, Securities Intermediary or Commodity
Intermediary, and shall not withhold its consent to the exercise of any
investment or withdrawal rights by such Pledgor, unless an Event of
Default has occurred and is continuing, or, in the case of withholding
consent to investment or withdrawal rights after giving effect to any such
investment and withdrawal rights would occur. No Pledgor shall grant
Control over any Investment Property to any person other than the
Collateral Agent and the securities intermediary at which such account is
maintained.
(iii) Subject to Section 11.1(ii), as between the Collateral Agent
and the Pledgors, the Pledgors shall bear the investment risk with respect
to the Investment Property and Pledged Securities, and the risk of loss
of, damage to, or the destruction of the Investment Property and Pledged
Securities, whether in the possession of, or maintained as a security
entitlement or deposit by, or subject to the control of, the Collateral
Agent, a Securities Intermediary, Commodity Intermediary, any Pledgor or
any other person; provided, however, that nothing contained in this
Section 3.4(c) shall release or relieve any Securities Intermediary or
Commodity Intermediary of its duties
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and obligations to the Pledgors or any other person under any Control
Agreement or under applicable law. Each Pledgor shall promptly pay all
Claims and fees of whatever kind or nature with respect to the Investment
Property and Pledged Securities pledged by it under this Agreement except
as otherwise expressly permitted under the Credit Agreement. In the event
any Pledgor shall fail to make such payment contemplated in the
immediately preceding sentence, the Collateral Agent may do so for the
account of such Pledgor and the Pledgors shall promptly reimburse and
indemnify the Collateral Agent from all costs and expenses incurred by the
Collateral Agent under this Section 3.4(c) in accordance with Section
11.03 of the Credit Agreement.
(d) Electronic Chattel Paper and Transferable Records. As of the
date hereof, no amount individually or in the aggregate in excess of
$10,000 payable under or in connection with any of the Pledged Collateral
is evidenced by any Electronic Chattel Paper or any "transferable record"
(as that term is defined in Section 201 of the Federal Electronic
Signatures in Global and National Commerce Act, or in Section 16 of the
Uniform Electronic Transactions Act as in effect in any relevant
jurisdiction) other than such Electronic Chattel Paper and transferable
records listed in Schedule 11 annexed to the Perfection Certificate. If
any amount individually or in the aggregate in excess of $10,000 payable
under or in connection with any of the Pledged Collateral shall be
evidenced by any Electronic Chattel Paper or any transferable record, the
Pledgor acquiring such Electronic Chattel Paper or transferable record
shall promptly notify the Collateral Agent thereof and shall take such
action as the Collateral Agent may reasonably request to vest in the
Collateral Agent control under UCC Section 9-105 of such Electronic
Chattel Paper or control under Section 201 of the Federal Electronic
Signatures in Global and National Commerce Act or, as the case may be,
Section 16 of the Uniform Electronic Transactions Act, as so in effect in
such jurisdiction, of such transferable record. The requirement in the
preceding sentence shall apply to the extent that such amount, together
with all amounts payable evidenced by Electronic Chattel Paper or any
transferable record in which the Collateral Agent has not been vested
control within the meaning of the statutes described in this sentence
exceeds $500,000 in the aggregate for all Pledgors. The Collateral Agent
agrees with such Pledgor that the Collateral Agent will arrange, pursuant
to procedures satisfactory to the Collateral Agent and so long as such
procedures will not result in the Collateral Agent's loss of control, for
the Pledgor to make alterations to the Electronic Chattel Paper or
transferable record permitted under UCC Section 9-105 or, as the case may
be, Section 201 of the Federal Electronic Signatures in Global and
National Commerce Act or Section 16 of the Uniform Electronic Transactions
Act for a party in control to allow without loss of control, unless an
Event of Default has occurred and is continuing or would occur after
taking into account any action by such Pledgor with respect to such
Electronic Chattel Paper or transferable record.
(e) Letter-of-Credit Rights. If any Pledgor is at any time a
beneficiary under a letter of credit now or hereafter issued in favor of
such Pledgor, other than a letter of credit issued pursuant to the Credit
Agreement and other than letter of credit rights
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constituting Supporting Obligations for which the face amount is less than
$25,000, such Pledgor shall promptly notify the Collateral Agent thereof
and such Pledgor shall, at the request of the Collateral Agent, pursuant
to an agreement in form and substance reasonably satisfactory to the
Collateral Agent, either (i) arrange for the issuer and any confirmer of
such letter of credit to consent to an assignment to the Collateral Agent
of the proceeds of any drawing under the letter of credit or (ii) arrange
for the Collateral Agent to become the transferee beneficiary of such
letter of credit, with the Collateral Agent agreeing, in each case, that
the proceeds of any drawing under the letter of credit are to be applied
as provided in the Credit Agreement. The actions in the preceding sentence
shall be taken to the extent that the amount under such letter of credit,
together with all amounts under letters of credit for which the actions
described above in clause (i) and (ii) have not been taken, exceeds
$500,000 in the aggregate for all Pledgors.
(f) Commercial Tort Claims. As of the date hereof, each Pledgor
hereby represents and warrants that it holds no Commercial Tort Claims
other than those listed in Schedule 14 annexed to the Perfection
Certificate. If any Pledgor shall at any time hold or acquire a Commercial
Tort Claim having, together with all other Commercial Tort Claims of all
Pledgors in which Commercial Tort Claims the Collateral Agent does not
have a security interest with an aggregate value in excess of $500,000,
such Pledgor shall promptly (and in any event within 5 Business Days)
notify the Collateral Agent in a writing signed by such Pledgor of the
brief details thereof and grant to the Collateral Agent in such writing a
security interest therein and in the Proceeds thereof, all upon the terms
of this Agreement, with such writing to be in form and substance
reasonably satisfactory to the Collateral Agent.
(g) Motor Vehicles. Upon the reasonable request of the Collateral
Agent, each Pledgor shall deliver to the Collateral Agent originals of the
certificates of title or ownership for the motor vehicles (and any other
Equipment covered by Certificates of Title or ownership) owned by it with
the Collateral Agent listed as lienholder therein. Such requirement only
shall apply to the Pledgors if any such motor vehicle (or any such other
Equipment) is valued at over $50,000, and the value of all such motor
vehicles (and such Equipment) as to which any Pledgor has not delivered a
Certificate of Title or ownership is over $500,000.
(h) As-Extracted Collateral. If any Pledgor shall acquire any
interest in any active mine or well or any preparation plant (in each case
to the extent that such interests constitutes personal property) or any
As-Extracted Collateral, then such Pledgor shall promptly take all such
actions as are reasonably required to ensure the validity, perfection or
priority of the Collateral Agent's security interest therein.
SECTION 3.5. Further Assurances. The Pledgors shall, to the extent
applicable, comply with Sections 5.12 and 5.13 of the Credit Agreement.
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ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
Each Pledgor represents, warrants and covenants as follows:
SECTION 4.1. Title. Except for the security interest granted to the
Collateral Agent for the ratable benefit of the Secured Parties pursuant to this
Agreement, such Pledgor owns and, as to Pledged Collateral acquired by it from
time to time after the date hereof, will own the rights in each item of Pledged
Collateral pledged by it hereunder free and clear of any and all Liens or claims
of others other than Permitted Collateral Liens. In addition, no Liens or claims
exist on the Securities Collateral, other than as permitted by Section 6.02 of
the Credit Agreement. No person other than the Collateral Agent has control or
possession of all or any part of the Pledged Collateral, except as permitted by
the Credit Agreement.
SECTION 4.2. Validity of Security Interest. The security interest in
and Lien on the Pledged Collateral granted to the Collateral Agent for the
benefit of the Secured Parties hereunder constitutes (a) a legal and valid
security interest in all the Pledged Collateral securing the payment and
performance of the Obligations, and (b) subject to the filings and other actions
described in Section 3.20 of the Credit Agreement, a perfected security interest
in all the Pledged Collateral. The security interest and Lien granted to the
Collateral Agent for the benefit of the Secured Parties pursuant to this
Agreement in and on the Pledged Collateral will at all times constitute a
perfected, continuing security interest therein, subject only to Permitted
Collateral Liens.
SECTION 4.3. Defense of Claims; Transferability of Pledged
Collateral. Each Pledgor shall, at its own cost and expense, defend title to the
Pledged Collateral pledged by it hereunder and the security interest therein and
Lien thereon granted to the Collateral Agent and the priority thereof against
all claims and demands of all persons, at its own cost and expense, at any time
claiming any interest therein adverse to the Collateral Agent or any other
Secured Party other than Permitted Collateral Liens and Contested Liens. There
is no agreement, and no Pledgor (subject to clause (ii) of the last sentence of
Section 2.1) shall enter into any agreement or take any other action, that would
restrict the transferability of any of the Pledged Collateral or otherwise
impair or conflict with such Pledgor's obligations or the rights of the
Collateral Agent hereunder.
SECTION 4.4. Other Financing Statements. It has not filed, nor
authorized any third party to file any (nor will there be any) valid or
effective 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 Pledged Collateral other than financing
statements and other statements and instruments relating to Permitted Collateral
Liens. Until the Termination Date, no Pledgor shall execute, authorize or permit
to be filed in any public office any financing statement (or similar statement
or instrument of registration under the law of any jurisdiction)
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relating to any Pledged Collateral, except financing statements and other
statements and instruments filed or to be filed in respect of and covering the
security interests granted by such Pledgor to the holder of the Permitted
Collateral Liens.
SECTION 4.5. Change of Name; Jurisdiction of Organization. (a) It
shall comply with the provisions of Section 5.14(a) of the Credit Agreement.
(b) The Collateral Agent may rely on opinions of counsel as to
whether any or all UCC financing statements of the Pledgors need to be amended
as a result of any of the changes described in Section 5.14(a) of the Credit
Agreement. If any Pledgor fails to provide information to the Collateral Agent
about such changes on a timely basis, the Collateral Agent shall not be liable
or responsible to any party for any failure to maintain a perfected security
interest in such Pledgor's property constituting Pledged Collateral, for which
the Collateral Agent needed to have information relating to such changes. The
Collateral Agent shall have no duty to inquire about such changes if any Pledgor
does not inform the Collateral Agent of such changes, the parties acknowledging
and agreeing that it would not be feasible or practical for the Collateral Agent
to search for information on such changes if such information is not provided by
any Pledgor.
SECTION 4.6. Location of Inventory and Equipment. Other than as
necessary in connection with routine maintenance and repair in the ordinary
course of business, it shall not move any Equipment or Inventory with an
aggregate value in excess of $100,000 to any location other than one within the
continental United States and with respect to any such new location where the
aggregate value of Collateral exceeds $100,000, such Pledgor shall have taken
all action reasonably satisfactory to the Collateral Agent to maintain the
perfection and priority of the security interest of the Collateral Agent for the
benefit of the Secured Parties in the Pledged Collateral intended to be granted
hereby, including using commercially reasonable efforts to obtain waivers of
landlord's or warehousemen's and/or bailee's liens with respect to such new
location, if applicable, and if reasonably requested by the Collateral Agent.
Such Pledgor agrees to provide the Collateral Agent with prompt notice following
the movement of any Equipment or Inventory to any location other than one that
is listed in the relevant Schedules to the Perfection Certificate.
SECTION 4.7. Due Authorization and Issuance. All of the Initial
Pledged Shares have been, and to the extent any Pledged Shares are hereafter
issued, such Pledged Shares will be, upon such issuance, duly authorized,
validly issued and fully paid and non-assessable. All of the Initial Pledged
Interests have been fully paid for, and there is no amount or other obligation
owing by any Pledgor to any issuer of the Initial Pledged Interests in exchange
for or in connection with the issuance of the Initial Pledged Interests or any
Pledgor's status as a partner or a member of any issuer of the Initial Pledged
Interests.
SECTION 4.8. Consents, etc. In the event that the Collateral Agent
desires to exercise any remedies, voting or consensual rights or
attorney-in-fact powers set forth in this Agreement in accordance with the terms
hereof and determines in its reasonable judgment that it
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is necessary to obtain any approvals or consents of any Governmental Authority
or any other person therefor, then, upon the reasonable request of the
Collateral Agent, such Pledgor agrees to use its commercially reasonable efforts
to assist and aid the Collateral Agent to obtain as soon as practicable any
necessary approvals or consents for the exercise of any such remedies, rights
and powers.
SECTION 4.9. Pledged Collateral. All information set forth herein,
including the schedules annexed hereto, and all information contained in any
documents, schedules and lists heretofore delivered to any Secured Party,
including the Perfection Certificate and the schedules thereto, in connection
with this Agreement, in each case, relating to the Pledged Collateral, is
accurate and complete in all material respects. The Pledged Collateral described
on the schedules annexed to the Perfection Certificate constitutes all of the
property of such type of Pledged Collateral owned or held by the Pledgors as of
the date of delivery of such schedules.
SECTION 4.10. Insurance. In the event that the proceeds of any
insurance claim are paid after the Collateral Agent has exercised its right to
foreclose after an Event of Default, such Net Cash Proceeds shall be applied in
accordance with the provisions set forth in the Credit Agreement.
SECTION 4.11. Payment of Taxes; Compliance with Laws; Contesting
Liens; Claims. Each Pledgor represents and warrants that all Claims imposed upon
or assessed against the Pledged Collateral have been paid and discharged except
to the extent such Claims are secured by Contested Liens or Permitted Collateral
Liens. Each Pledgor shall comply with all Requirements of Law applicable to the
Pledged Collateral the failure to comply with which would, individually or in
the aggregate, have a Material Adverse Effect. Each Pledgor may at its own
expense contest the validity, amount or applicability of any Claims so long as
the contest thereof shall be conducted in accordance with, and permitted
pursuant to the provisions of, the Credit Agreement. Notwithstanding the
foregoing provisions of this Section 4.11, (i) no contest of any such obligation
may be pursued by such Pledgor if such contest would expose the Collateral Agent
or any other Secured Party to (A) any possible criminal liability or (B) any
additional civil liability for failure to comply with such obligations unless
such Pledgor shall have furnished a bond or other security therefor satisfactory
to the Collateral Agent or such Secured Party, as the case may be and (ii) any
such contest shall satisfy the Contested Collateral Lien Conditions.
SECTION 4.12. Access to Pledged Collateral, Books and Records; Other
Information. Upon reasonable request to each Pledgor and subject to the terms
and conditions set forth in Section 5.07 of the Credit Agreement, the Collateral
Agent, its agents, accountants and attorneys shall have full and free access to
visit and inspect, as applicable, during normal business hours and such other
reasonable times as may be reasonably requested by the Collateral Agent all of
the Pledged Collateral and Mortgaged Property including all of the books,
correspondence and records of such Pledgor relating thereto. The Collateral
Agent and its representatives may examine the same, take extracts therefrom and
make photocopies thereof, and such Pledgor agrees to render to the Collateral
Agent, at such Pledgor's cost and expense,
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such clerical and other assistance as may be reasonably requested by the
Collateral Agent with regard thereto. Such Pledgor shall, at any and all times,
within a reasonable time after written request by the Collateral Agent, furnish
or cause to be furnished to the Collateral Agent, in such manner and in such
detail as may be reasonably requested by the Collateral Agent, additional
information with respect to the Pledged Collateral.
ARTICLE V
CERTAIN PROVISIONS CONCERNING SECURITIES COLLATERAL
SECTION 5.1. Pledge of Additional Securities Collateral. Each
Pledgor shall, upon obtaining any Pledged Securities or Intercompany Notes
required to be pledged hereunder, accept the same in trust for the benefit of
the Collateral Agent and promptly and in any event within 3 Business Days
deliver to the Collateral Agent a pledge amendment, duly executed by such
Pledgor, in substantially the form of Exhibit 2 annexed hereto (each, a "Pledge
Amendment"), and the certificates and other documents required under Section 3.1
and Section 3.2 hereof in respect of the additional Pledged Securities or
Intercompany Notes which are to be pledged pursuant to this Agreement, and
confirming the attachment of the Lien hereby created on and in respect of such
additional Pledged Securities or Intercompany Notes. Each Pledgor hereby
authorizes the Collateral Agent to attach each Pledge Amendment to this
Agreement and agrees that all Pledged Securities or Intercompany Notes listed on
any Pledge Amendment delivered to the Collateral Agent shall for all purposes
hereunder be considered Pledged Collateral.
SECTION 5.2. Voting Rights; Distributions; etc.
(i) So long as no Event of Default shall have occurred and be
continuing:
(A) Each Pledgor shall be entitled to exercise any and all voting
and other consensual rights pertaining to the Securities Collateral or any
part thereof for any purpose not inconsistent with the terms or purposes
hereof, the Credit Agreement or any other document evidencing the
Obligations; provided, however, that no Pledgor shall in any event
exercise such rights in any manner which would reasonably be expected to
have a Material Adverse Effect.
(B) Each Pledgor shall be entitled to receive and retain, and to
utilize free and clear of the Lien created hereby, any and all
Distributions, but only if and to the extent made in accordance with the
provisions of the Credit Agreement; provided, however, that any and all
such Distributions consisting of rights or interests in the form of
securities shall be promptly and in any event within 3 Business Days
delivered to the Collateral Agent to hold as Pledged Collateral and shall,
if received by any Pledgor, be received in trust for the benefit of the
Collateral Agent, be segregated from the other property or
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funds of such Pledgor and be promptly and in any event within 3 Business
Days delivered to the Collateral Agent as Pledged Collateral in the same
form as so received (with any necessary endorsement).
(ii) The Collateral Agent shall be deemed without further action or
formality to have granted to each Pledgor all necessary consents relating to
voting rights and shall, if necessary, upon written request of any Pledgor and
at the sole cost and expense of the Pledgors, from time to time execute and
deliver (or cause to be executed and delivered) to such Pledgor all such
instruments as such Pledgor may reasonably request in order to permit such
Pledgor to exercise the voting and other rights which it is entitled to exercise
pursuant to Section 5.2(i)(A) hereof and to receive the Distributions which it
is authorized to receive and retain pursuant to Section 5.2(i)(B) hereof.
(iii) Upon the occurrence and during the continuance of any Event of
Default:
(A) All rights of each Pledgor to exercise the voting and other
consensual rights it would otherwise be entitled to exercise pursuant to
Section 5.2(i)(A) hereof shall cease, and all such rights shall thereupon
become vested in the Collateral Agent, which shall thereupon have the sole
right to exercise such voting and other consensual rights.
(B) All rights of each Pledgor to receive Distributions which it
would otherwise be authorized to receive and retain pursuant to Section
5.2(i)(B) hereof shall cease and all such rights shall thereupon become
vested in the Collateral Agent, which shall thereupon have the sole right
to receive and hold as Pledged Collateral such Distributions.
(iv) Each Pledgor shall, at its sole cost and expense, from time to
time execute and deliver to the Collateral Agent appropriate instruments as the
Collateral Agent may request in order to permit the Collateral Agent to exercise
the voting and other rights which it may be entitled to exercise pursuant to
Section 5.2(i)(A) hereof and to receive all Distributions which it may be
entitled to receive under Section 5.2(i)(B) hereof.
(v) All Distributions which are received by any Pledgor contrary to
the provisions of Section 5.2(i)(B) hereof shall be received in trust for the
benefit of the Collateral Agent, shall be segregated from other funds of such
Pledgor and shall promptly, but in no event more than 3 Business Days after
receipt, be paid over to the Collateral Agent as Pledged Collateral in the same
form as so received (with any necessary endorsement).
SECTION 5.3. Defaults, etc. Such Pledgor is not in default in the
payment of any portion of any mandatory capital contribution, if any, required
to be made under any agreement to which such Pledgor is a party relating to the
Pledged Securities pledged by it, and such Pledgor is not in violation in any
material respect of any other provisions of any such agreement to which such
Pledgor is a party, or otherwise in material default or violation thereunder. No
Securities Collateral pledged by such Pledgor is subject to any defense, offset
or
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counterclaim, nor have any of the foregoing been asserted or alleged against
such Pledgor by any person with respect thereto, and as of the date hereof,
there are no certificates, instruments, documents or other writings (other than
the Organizational Documents and certificates, if any, delivered to the
Collateral Agent) which evidence any Pledged Securities of such Pledgor.
SECTION 5.4. Certain Agreements of Pledgors As Issuers and Holders
of equity interests.
(i) In the case of each Pledgor which is an issuer of Securities
Collateral, such Pledgor agrees to be bound by the terms of this Agreement
relating to the Securities Collateral issued by it and will comply with such
terms insofar as such terms are applicable to it.
(ii) In the case of each Pledgor which is a partner in a
partnership, limited liability company or other entity, such Pledgor hereby
consents to the extent required by the applicable Organizational Document to the
pledge by each other Pledgor, pursuant to the terms hereof, of the Pledged
Interests in such partnership, limited liability company or other entity and,
upon the occurrence and during the continuance of an Event of Default, to the
transfer of such Pledged Interests to the Collateral Agent or its nominee and to
the substitution of the Collateral Agent or its nominee as a substituted partner
or member in such partnership, limited liability company or other entity with
all the rights, powers and duties of a general partner or a limited partner or
member, as the case may be.
ARTICLE VI
CERTAIN PROVISIONS CONCERNING INTELLECTUAL
PROPERTY COLLATERAL
SECTION 6.1. Grant of License. For the purpose of enabling the
Collateral Agent, during the continuance of an Event of Default, to exercise
rights and remedies under Article IX hereof at such time as the Collateral Agent
shall be lawfully entitled to exercise such rights and remedies, and for no
other purpose, each Pledgor hereby grants to the Collateral Agent, to the extent
assignable, an irrevocable, non-exclusive license to use, assign, license or
sublicense any of the Intellectual Property Collateral subject, in the case of
Trademarks, to sufficient rights to quality control and inspection in favor of
the Pledgor to avoid the invalidation of such Trademarks, now owned or hereafter
acquired by such Pledgor, wherever the same may be located. Such license shall
include access to all media in which any of the licensed items may be recorded
or stored and to all computer programs used for the compilation or printout
hereof.
SECTION 6.2. Protection of Collateral Agent's Security. On a
continuing basis, each Pledgor shall, at its sole cost and expense, (i) promptly
following its becoming aware thereof, notify the Collateral Agent of (A) any
materially adverse determination in any proceeding in the United States Patent
and Trademark Office or the United States Copyright
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Office with respect to any material Patent, Trademark or Copyright or (B) the
institution of any proceeding or any adverse determination in any federal, state
or local court or administrative body regarding such Pledgor's claim of
ownership in or right to use any of the Intellectual Property Collateral
material to the operation of such Pledgor's business in the ordinary course, its
right to register such Intellectual Property Collateral or its right to keep and
maintain such registration in full force and effect, (ii) maintain and protect
the Intellectual Property Collateral material to the operation of such Pledgor's
business in the ordinary course as presently conducted and as contemplated by
the Credit Agreement, (iii) not permit to lapse or become abandoned any
Intellectual Property Collateral material to the operation of such Pledgor's
business in the ordinary course as presently conducted and as contemplated by
the Credit Agreement, and not settle or compromise any pending or future
litigation or administrative proceeding with respect to such Intellectual
Property Collateral, in each case except as shall be consistent with
commercially reasonable business judgment, (iv) upon such Pledgor obtaining
knowledge thereof, promptly notify the Collateral Agent in writing of any event
which would reasonably be expected to materially and adversely affect the value
or utility of the Intellectual Property Collateral or any portion thereof
material to the ability of such Pledgor or the Collateral Agent to dispose of
the Intellectual Property Collateral or any portion thereof or the rights and
remedies of the Collateral Agent in relation thereto including a levy or threat
of levy or any legal process against the Intellectual Property Collateral or any
portion thereof, (v) not license the Intellectual Property Collateral other than
licenses entered into by such Pledgor in, or incidental to, the ordinary course
of business, or amend or permit the amendment of any of the licenses in a manner
that materially and adversely affects the right to receive payments thereunder,
or in any manner that would materially impair the value of the Intellectual
Property Collateral or the Lien on and security interest in the Intellectual
Property Collateral intended to be granted to the Collateral Agent for the
benefit of the Secured Parties, without the consent of the Collateral Agent,
(vi) diligently keep adequate records respecting the Intellectual Property
Collateral and (vii) furnish to the Collateral Agent from time to time upon the
Collateral Agent's reasonable request therefor reasonably detailed statements
and amended schedules further identifying and describing the Intellectual
Property Collateral and such other materials evidencing or reports pertaining to
the Intellectual Property Collateral as the Collateral Agent may from time to
time reasonable request. Notwithstanding the foregoing nothing herein shall
prevent any Pledgor from selling, disposing of or otherwise using any
Intellectual Property Collateral as expressly permitted under the Credit
Agreement.
SECTION 6.3. After-Acquired Property. If any Pledgor shall, at any
time before the Termination Date (i) obtain any rights to any additional
material Intellectual Property Collateral or (ii) become entitled to the benefit
of any additional material Intellectual Property Collateral or any renewal or
extension thereof, including any reissue, division, continuation, or
continuation-in-part of such Intellectual Property Collateral, or any
improvement on such Intellectual Property Collateral, the provisions hereof
shall automatically apply thereto and any such item enumerated in clause (i) or
(ii) of this Section 6.3 with respect to such Pledgor shall (other than in the
case of any Intellectual Property Collateral that constitutes Excluded Property)
automatically constitute Intellectual Property Collateral if such would have
constituted
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Intellectual Property Collateral at the time of execution hereof and be subject
to the Lien and security interest created by this Agreement without further
action by any party. Each Pledgor shall promptly (i) provide to the Collateral
Agent written notice of any of the foregoing and (ii) confirm the attachment of
the Lien and security interest created by this Agreement to any rights described
in clauses (i) and (ii) of the immediately preceding sentence of this Section
6.3 by execution of an instrument in form reasonably acceptable to the
Collateral Agent and the filing of any instruments or statements as shall be
reasonably necessary to preserve, protect or perfect the Collateral Agent's
security interest in such Intellectual Property Collateral. Further, each
Pledgor authorizes the Collateral Agent to modify this Agreement by amending
Schedules 13(c) and 13(d) annexed to the Perfection Certificate to include any
Intellectual Property Collateral acquired or arising after the date hereof of
such Pledgor.
SECTION 6.4. Litigation. Unless there shall occur and be continuing
any Event of Default, each Pledgor shall have the right to commence and
prosecute in its own name, as the party in interest, for its own benefit and at
the sole cost and expense of the Pledgors, such applications for protection of
the Intellectual Property Collateral and suits, proceedings or other actions to
prevent the infringement, counterfeiting, unfair competition, dilution,
diminution in value or other damage as are necessary to protect the Intellectual
Property Collateral. Upon the occurrence and during the continuance of any Event
of Default, the Collateral Agent shall have the right but shall in no way be
obligated to file applications for protection of the Intellectual Property
Collateral and/or bring suit in the name of any Pledgor, the Collateral Agent or
the Secured Parties to enforce the Intellectual Property Collateral and any
license thereunder. In the event of such suit, each Pledgor shall, at the
reasonable request of the Collateral Agent, do any and all lawful acts and
execute any and all documents requested by the Collateral Agent in aid of such
enforcement and the Pledgors shall promptly reimburse and indemnify the
Collateral Agent for all costs and expenses incurred by the Collateral Agent in
the exercise of its rights under this Section 6.4 in accordance with Section
11.03 of the Credit Agreement. In the event that the Collateral Agent shall
elect not to bring suit to enforce the Intellectual Property Collateral, each
Pledgor agrees, at the reasonable request of the Collateral Agent, to take all
commercially reasonable actions necessary, whether by suit, proceeding or other
action, to prevent the infringement, counterfeiting, unfair competition,
dilution, diminution in value of or other damage to any of the Intellectual
Property Collateral by others and for that purpose agrees to diligently maintain
any suit, proceeding or other action against any person so infringing necessary
to prevent such infringement to the extent commercially reasonable.
ARTICLE VII
CERTAIN PROVISIONS CONCERNING ACCOUNTS
SECTION 7.1. Maintenance of Records. Each Pledgor shall keep and
maintain at its own cost and expense complete records of each Account, in a
manner consistent with
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prudent business practice, including records of all payments received, all
credits granted thereon, all merchandise returned and all other documentation
relating thereto. Each Pledgor shall, at such Pledgor's sole cost and expense,
upon the Collateral Agent's demand made at any time after the occurrence and
during the continuance of any Event of Default, deliver all tangible evidence of
Accounts, including all documents evidencing Accounts and any books and records
relating thereto to the Collateral Agent or to its representatives (copies of
which evidence and books and records may be retained by such Pledgor). Upon the
occurrence and during the continuance of any Event of Default, the Collateral
Agent may transfer a full and complete copy of any Pledgor's books, records,
credit information, reports, memoranda and all other writings relating to the
Accounts to and for the use by any person that has acquired or is contemplating
acquisition of an interest in the Accounts or the Collateral Agent's security
interest therein without the consent of any Pledgor.
SECTION 7.2. Legend. Each Pledgor shall legend, at the request of
the Collateral Agent, upon the occurrence and during the continuation of a
Default, and in form and manner reasonably satisfactory to the Collateral Agent,
the Accounts and the other books, records and documents of such Pledgor
evidencing or pertaining to the Accounts with an appropriate reference to the
fact that the Accounts have been assigned to the Collateral Agent for the
benefit of the Secured Parties and that the Collateral Agent has a security
interest therein.
SECTION 7.3. Modification of Terms, etc. No Pledgor shall rescind or
cancel any obligations evidenced by any Account or modify any term thereof or
make any adjustment with respect thereto except in the ordinary course of
business consistent with prudent business practice, or extend or renew any such
obligations except in the ordinary course of business consistent with prudent
business practice or compromise or settle any dispute, claim, suit or legal
proceeding relating thereto or sell any Account or interest therein except in
the ordinary course of business consistent with prudent business practice
without the prior written consent of the Collateral Agent. Each Pledgor shall
timely fulfill all obligations on its part to be fulfilled under or in
connection with the Accounts in accordance with present business practices.
SECTION 7.4. Collection. Each Pledgor shall cause to be collected
from the Account Debtor of each of the Accounts, as and when due in the ordinary
course of business and consistent with prudent business practice (including
Accounts that are delinquent, such Accounts to be collected in accordance with
generally accepted commercial collection procedures), any and all amounts owing
under or on account of such Account, and apply forthwith upon receipt thereof
all such amounts as are so collected to the outstanding balance of such Account,
except that any Pledgor may, with respect to an Account, allow in the ordinary
course of business (i) a refund or credit due as a result of returned or damaged
or defective merchandise and (ii) such extensions of time to pay amounts due in
respect of Accounts and such other modifications of payment terms or settlements
in respect of Accounts as shall be commercially reasonable in the circumstances,
all in accordance with such Pledgor's ordinary course of business consistent
with its collection practices as in effect from time to time. The costs and
expenses (including attorneys' fees) of collection, in any case, whether
incurred by any Pledgor, the Collateral Agent or any Secured Party, shall be
paid by the Pledgors.
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ARTICLE VIII
TRANSFERS
SECTION 8.1. Transfers of Pledged Collateral. No Pledgor shall sell,
convey, assign or otherwise dispose of, or grant any option with respect to, any
of the Pledged Collateral pledged by it hereunder except as permitted by the
Credit Agreement.
ARTICLE IX
REMEDIES
SECTION 9.1. Remedies. Upon the occurrence and during the
continuance of any Event of Default, the Collateral Agent may from time to time
exercise in respect of the Pledged Collateral, in addition to the other rights
and remedies provided for herein or otherwise available to it, the following
remedies:
(i) Personally, or by agents or attorneys, immediately take
possession of the Pledged Collateral or any part thereof, from any Pledgor or
any other person who then has possession of any part thereof with or without
notice or process of law, and for that purpose may enter upon any Pledgor's
premises where any of the Pledged Collateral is located, remove such Pledged
Collateral, remain present at such premises to receive copies of all
communications and remittances relating to the Pledged Collateral and use in
connection with such removal and possession any and all services, supplies, aids
and other facilities of any Pledgor;
(ii) Demand, ▇▇▇ for, collect or receive any money or property at
any time payable or receivable in respect of the Pledged Collateral including
instructing the obligor or obligors on any agreement, instrument or other
obligation constituting part of the Pledged Collateral to make any payment
required by the terms of such agreement, instrument or other obligation directly
to the Collateral Agent, and in connection with any of the foregoing,
compromise, settle, extend the time for payment and make other modifications
with respect thereto; provided, however, that in the event that any such
payments are made directly to any Pledgor, prior to receipt by any such obligor
of such instruction, such Pledgor shall segregate all amounts received pursuant
thereto in trust for the benefit of the Collateral Agent and shall promptly (but
in no event later than one Business Day after receipt thereof) pay such amounts
to the Collateral Agent;
(iii) Sell, assign, grant a license to use or otherwise liquidate,
or direct any Pledgor to sell, assign, grant a license to use or otherwise
liquidate, any and all investments made in whole or in part with the Pledged
Collateral or any part thereof, and take possession of the proceeds of any such
sale, assignment, license or liquidation;
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(iv) Take possession of the Pledged Collateral or any part thereof,
by directing any Pledgor in writing to deliver the same to the Collateral Agent
at any place or places so designated by the Collateral Agent, in which event
such Pledgor shall at its own expense: (A) promptly and in any event within 3
Business Days cause the same to be moved to the place or places designated by
the Collateral Agent and therewith delivered to the Collateral Agent, (B) store
and keep any Pledged Collateral so delivered to the Collateral Agent at such
place or places pending further action by the Collateral Agent and (C) while the
Pledged Collateral shall be so stored and kept, provide such security and
maintenance services as shall be necessary to protect the same and to preserve
and maintain them in good condition. Each Pledgor's obligation to deliver the
Pledged Collateral as contemplated in this Section 9.1(iv) is of the essence
hereof. Upon application to a court of equity having jurisdiction, the
Collateral Agent shall be entitled to a decree requiring specific performance by
any Pledgor of such obligation;
(v) Withdraw all moneys, instruments, securities and other property
in any bank, financial securities, deposit or other account of any Pledgor
constituting Pledged Collateral for application to the Obligations as provided
in Article X hereof;
(vi) Retain and apply the Distributions to the Obligations as
provided in Article X hereof;
(vii) Exercise any and all rights as beneficial and legal owner of
the Pledged Collateral, including perfecting the assignment of, and exercising
any and all voting, consensual and other rights and powers with respect to, any
Pledged Collateral; and
(viii) Exercise all the rights and remedies of a secured party on
default under the UCC, and the Collateral Agent may also in its sole discretion,
without notice except as specified in Section 9.2 hereof, sell, assign or grant
a license to use the Pledged Collateral or any part thereof in one or more
parcels at public or private sale, at any exchange, broker's board or at any of
the Collateral Agent's offices or elsewhere, for cash, on credit or for future
delivery, and at such price or prices and upon such other terms as the
Collateral Agent may deem commercially reasonable. The Collateral Agent or any
other Secured Party or any of their respective Affiliates may be the purchaser,
licensee, assignee or recipient of any or all of the Pledged Collateral at any
such sale and shall be entitled, for the purpose of bidding and making
settlement or payment of the purchase price for all or any portion of the
Pledged Collateral sold, assigned or licensed at such sale, to use and apply any
of the Obligations owed to such person as a credit on account of the purchase
price of any Pledged Collateral payable by such person at such sale. Each
purchaser, assignee, licensee or recipient at any such sale shall acquire the
property sold, assigned or licensed absolutely free from any claim or right on
the part of any Pledgor, and each Pledgor hereby waives, to the fullest extent
permitted by law, all rights of redemption, stay and/or appraisal which it now
has or may at any time in the future have under any rule of law or statute now
existing or hereafter enacted. The Collateral Agent shall not be obligated to
make any sale of Pledged Collateral regardless of notice of sale having been
given. The Collateral Agent may adjourn any public or private sale from time to
time by announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to
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which it was so adjourned. Each Pledgor hereby waives, to the fullest extent
permitted by law, any claims against the Collateral Agent arising by reason of
the fact that the price at which any Pledged Collateral may have been sold,
assigned or licensed at such a private sale was less than the price which might
have been obtained at a public sale, even if the Collateral Agent accepts the
first offer received and does not offer such Pledged Collateral to more than one
offeree.
SECTION 9.2. Notice of Sale. Each Pledgor acknowledges and agrees
that, to the extent notice of sale or other disposition of Pledged Collateral
shall be required by law, 10 days' prior notice to such Pledgor of the time and
place of any public sale or of the time after which any private sale or other
intended disposition is to take place shall be commercially reasonable
notification of such matters. No notification need be given to any Pledgor if it
has signed, after the occurrence of an Event of Default, a statement renouncing
or modifying any right to notification of sale or other intended disposition.
SECTION 9.3. Waiver of Notice and Claims. Each Pledgor hereby
waives, to the fullest extent permitted by applicable law, notice or judicial
hearing in connection with the Collateral Agent's taking possession or the
Collateral Agent's disposition of any of the Pledged Collateral, including any
and all prior notice and hearing for any prejudgment remedy or remedies and any
such right which such Pledgor would otherwise have under law, and each Pledgor
hereby further waives, to the fullest extent permitted by applicable law: (i)
all damages occasioned by such taking of possession, (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, appraisal, valuation, stay, extension or moratorium now or
hereafter in force under any applicable law. The Collateral Agent shall not be
liable for any incorrect or improper payment made pursuant to this Article IX in
the absence of gross negligence or willful misconduct. To the fullest extent
permitted by law, any sale of, or grant of options to purchase, or any other
realization upon, any Pledged Collateral shall operate to divest all right,
title, interest, claim and demand, either at law or in equity, of the applicable
Pledgor therein and thereto, and shall be a perpetual bar both at law and in
equity against such Pledgor and against any and all persons claiming or
attempting to claim the Pledged Collateral so sold, optioned or realized upon,
or any part thereof, from, through or under such Pledgor.
SECTION 9.4. Certain Sales of Pledged Collateral.
(i) Each Pledgor recognizes that, by reason of certain prohibitions
contained in law, rules, regulations or orders of any Governmental Authority,
the Collateral Agent may be compelled, with respect to any sale of all or any
part of the Pledged Collateral, to limit purchasers to those who meet the
requirements of such Governmental Authority. Each Pledgor acknowledges that any
such sales may be at prices and on terms less favorable to the Collateral Agent
than those obtainable through a public sale without such restrictions, and,
notwithstanding such circumstances, agrees that any such restricted sale shall
be deemed to have been made in a commercially reasonable manner and that, except
as may be required by applicable law, the Collateral Agent shall have no
obligation to engage in public sales.
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(ii) Each Pledgor recognizes that, by reason of certain prohibitions
contained in the Securities Act, and applicable state securities laws, the
Collateral Agent may be compelled, with respect to any sale of all or any part
of the Securities Collateral and Investment Property, to limit purchasers to
persons who will agree, among other things, to acquire such Securities
Collateral or Investment Property for their own account, for investment and not
with a view to the distribution or resale thereof. Each Pledgor acknowledges
that any such private sales may be at prices and on terms less favorable to the
Collateral Agent than those obtainable through a public sale without such
restrictions (including a public offering made pursuant to a registration
statement under the Securities Act), and, notwithstanding such circumstances,
agrees that any such private sale shall be deemed to have been made in a
commercially reasonable manner and that the Collateral Agent shall have no
obligation to engage in public sales and no obligation to delay the sale of any
Securities Collateral or Investment Property for the period of time necessary to
permit the issuer thereof to register it for a form of public sale requiring
registration under the Securities Act or under applicable state securities laws,
even if such issuer would agree to do so.
(iii) If the Collateral Agent determines to exercise its right to
sell any or all of the Securities Collateral or Investment Property, upon
written request, the applicable Pledgor shall from time to time furnish to the
Collateral Agent all such information as the Collateral Agent may request in
order to determine the number of securities included in the Securities
Collateral or Investment Property which may be sold by the Collateral Agent as
exempt transactions under the Securities Act and the rules of the Securities and
Exchange Commission thereunder, as the same are from time to time in effect.
(iv) Each Pledgor further agrees that a breach of any of the
covenants contained in this Section 9.4 will cause irreparable injury to the
Collateral Agent and other Secured Parties, that the Collateral Agent and the
other Secured Parties have no adequate remedy at law in respect of such breach
and, as a consequence, that each and every covenant contained in this Section
9.4 shall be specifically enforceable against such Pledgor, and such Pledgor
hereby waives and agrees not to assert any defenses against an action for
specific performance of such covenants except for a defense that no Event of
Default has occurred and is continuing.
SECTION 9.5. No Waiver; Cumulative Remedies.
(i) No failure on the part of the Collateral Agent to exercise, no
course of dealing with respect to, and no delay on the part of the Collateral
Agent in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right,
power or remedy hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or remedy; nor shall the Collateral Agent be
required to look first to, enforce or exhaust any other security, collateral or
guaranties. The remedies herein provided are cumulative and are not exclusive of
any remedies provided by law.
(ii) To the fullest extent permitted by applicable Requirements of
Law, in the event that the Collateral Agent shall have instituted any proceeding
to enforce any right, power
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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 Pledgors, the Collateral Agent and each other Secured Party shall
be restored to their respective former positions and rights hereunder with
respect to the Pledged Collateral, and all rights, remedies and powers of the
Collateral Agent and the other Secured Parties shall continue as if no such
proceeding had been instituted.
SECTION 9.6. Certain Additional Actions Regarding Intellectual
Property. If any Event of Default shall have occurred and be continuing, upon
the written demand of the Collateral Agent, each Pledgor shall execute and
deliver to the Collateral Agent an assignment or assignments of the registered
Patents, Trademarks and/or Copyrights and Goodwill and such other documents as
are necessary or appropriate to carry out the intent and purposes hereof. Within
five Business Days of written notice thereafter from the Collateral Agent, each
Pledgor shall make available to the Collateral Agent, to the extent within such
Pledgor's power and authority, such personnel in such Pledgor's employ on the
date of the Event of Default as the Collateral Agent may reasonably designate to
permit such Pledgor to continue, directly or indirectly, to produce, advertise
and sell the products and services sold by such Pledgor under the registered
Patents, Trademarks and/or Copyrights, and such persons shall be available to
perform their prior functions on the Collateral Agent's behalf.
ARTICLE X
PROCEEDS OF CASUALTY EVENTS AND COLLATERAL DISPOSITIONS;
APPLICATION OF PROCEEDS
SECTION 10.1. Proceeds of Casualty Events and Collateral
Dispositions. The Pledgors shall take all actions required by the Credit
Agreement with respect to any Net Cash Proceeds of any Casualty Event or any Net
Cash Proceeds from the sale or disposition of any Pledged Collateral.
SECTION 10.2. Application of Proceeds. The proceeds received by the
Collateral Agent in respect of any sale of, collection from or other realization
upon all or any part of the Collateral pursuant to the exercise by the
Collateral Agent of its remedies shall be applied, together with any other sums
then held by the Collateral Agent pursuant to this Agreement, in accordance with
and as set forth in Section 9.03 of the Credit Agreement.
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ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Concerning Collateral Agent.
(i) The Collateral Agent has been appointed as collateral agent
pursuant to the Credit Agreement. The actions of the Collateral Agent hereunder
are subject to the provisions of the Credit Agreement. The Collateral Agent
shall have the right hereunder to make demands, to give notices, to exercise or
refrain from exercising any rights, and to take or refrain from taking action
(including the release or substitution of the Pledged Collateral), in accordance
with this Agreement and the Credit Agreement. The Collateral Agent may employ
agents and attorneys-in-fact in connection herewith and shall not be liable for
the negligence or misconduct of any such agents or attorneys-in-fact selected by
it in good faith. The Collateral Agent may resign and a successor Collateral
Agent may be appointed in the manner provided in the Credit Agreement. Upon the
acceptance of any appointment as the Collateral Agent by a successor Collateral
Agent, that successor Collateral Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Collateral Agent under this Agreement, and the retiring Collateral Agent shall
thereupon be discharged from its duties and obligations under this Agreement.
After any retiring Collateral Agent's resignation, the provisions hereof shall
inure to its benefit as to any actions taken or omitted to be taken by it under
this Agreement while it was the Collateral Agent.
(ii) The Collateral Agent shall be deemed to have exercised
reasonable care in the custody and preservation of the Pledged Collateral in its
possession if such Pledged Collateral is accorded treatment substantially
equivalent to that which the Collateral Agent, in its individual capacity,
accords its own property consisting of similar instruments or interests, it
being understood that neither the Collateral Agent nor any of the Secured
Parties shall have responsibility for (i) ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relating to any Securities Collateral, whether or not the Collateral Agent or
any other Secured Party has or is deemed to have knowledge of such matters or
(ii) taking any necessary steps to preserve rights against any person with
respect to any Pledged Collateral.
(iii) The Collateral Agent shall be entitled to rely upon any
written notice, statement, certificate, order or other document or any telephone
message reasonably believed by it to be genuine and correct and to have been
signed, sent or made by the proper person, and, with respect to all matters
pertaining to this Agreement and its duties hereunder, upon advice of counsel
selected by it.
(iv) If any item of Pledged Collateral also constitutes collateral
granted to the Collateral Agent under any other deed of trust, mortgage,
security agreement, pledge or instrument of any type, in the event of any
conflict between the provisions hereof and the
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provisions of such other deed of trust, mortgage, security agreement, pledge or
instrument of any type in respect of such collateral, the Collateral Agent, in
its sole discretion, shall select which provision or provisions shall control.
SECTION 11.2. Collateral Agent May Perform; Collateral Agent
Appointed Attorney-in-Fact. If any Pledgor shall fail to perform any covenants
contained in this Agreement (including such Pledgor's covenants to (i) pay the
premiums in respect of all required insurance policies hereunder, (ii) pay
Claims, (iii) make repairs, (iv) discharge Liens or (v) pay or perform any
obligations of such Pledgor under any Pledged Collateral, in each case to the
extent required hereunder) or if any representation or warranty on the part of
any Pledgor contained herein shall be breached in any material respect, the
Collateral Agent may (but shall not be obligated to) do the same or cause it to
be done or remedy any such breach, and may expend funds for such purpose;
provided, however, that the Collateral Agent shall in no event be bound to
inquire into the validity of any tax, lien, imposition or other obligation which
such Pledgor fails to pay or perform as and when required hereby and which such
Pledgor does not contest in accordance with the provisions of Section 4.11
hereof. Any and all amounts so expended by the Collateral Agent shall be paid by
the Pledgors in accordance with the provisions of Section 11.03 of the Credit
Agreement. Neither the provisions of this Section 11.2 nor any action taken by
the Collateral Agent pursuant to the provisions of this Section 11.2 shall
prevent any such failure to observe any covenant contained in this Agreement nor
any breach of representation or warranty from constituting an Event of Default.
Each Pledgor hereby appoints the Collateral Agent its attorney-in-fact, with
full authority in the place and stead of such Pledgor and in the name of such
Pledgor, or otherwise, from time to time in the Collateral Agent's discretion to
take any action and to execute any instrument consistent with the terms of the
Credit Agreement, this Agreement and the other Security Documents which the
Collateral Agent may deem necessary or advisable to accomplish the purposes
hereof. The foregoing grant of authority is a power of attorney coupled with an
interest and such appointment shall be irrevocable for the term hereof. Each
Pledgor hereby ratifies all that such attorney shall lawfully do or cause to be
done by virtue hereof.
SECTION 11.3. Continuing Security Interest; Assignment. This
Agreement shall create a continuing security interest in the Pledged Collateral
and shall (i) be binding upon the Pledgors and their respective successors and
assigns and (ii) inure, together with the rights and remedies of the Collateral
Agent hereunder, to the benefit of the Collateral Agent and the other Secured
Parties and each of their respective permitted successors, transferees and
assigns under the Credit Agreement. No other persons (including any other
creditor of any Pledgor) shall have any interest herein or any right or benefit
with respect hereto. Without limiting the generality of the foregoing clause
(ii), any Secured Party may assign or otherwise transfer any indebtedness held
by it secured by this Agreement to any other person, and such other person shall
thereupon become vested with all the benefits in respect thereof granted to such
Secured Party, herein or otherwise, subject however, to the provisions of the
Credit Agreement and any Hedging Agreement.
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SECTION 11.4. Termination; Release. The Pledged Collateral shall be
released from the Lien created by this Agreement on the Termination Date. Upon
termination hereof or any release of Pledged Collateral in accordance with the
provisions of the Credit Agreement, the Collateral Agent shall, upon the request
and at the sole cost and expense of the Pledgors, assign, transfer and deliver
to the Pledgors, against receipt and without recourse to or warranty by the
Collateral Agent except as to the fact that the Collateral Agent has not
encumbered the released assets, such of the Pledged Collateral to be released
(in the case of a release) as may be in possession of the Collateral Agent and
as shall not have been sold or otherwise applied pursuant to the terms hereof,
and, with respect to any other Pledged Collateral, proper documents and
instruments (including UCC-3 termination statements or releases) acknowledging
the termination hereof or the release of such Pledged Collateral, as the case
may be.
SECTION 11.5. Modification in Writing. No amendment, modification,
supplement, termination or waiver of or to any provision hereof, nor consent to
any departure by any Pledgor therefrom, shall be effective unless the same shall
be made in accordance with the terms of the Credit Agreement and unless in
writing and signed by the Collateral Agent. Any amendment, modification or
supplement of or to any provision hereof, any waiver of any provision hereof and
any consent to any departure by any Pledgor from the terms of any provision
hereof shall be effective only in the specific instance and for the specific
purpose for which made or given. Except where notice is specifically required by
this Agreement or any other document evidencing the Obligations, no notice to or
demand on any Pledgor in any case shall entitle any Pledgor to any other or
further notice or demand in similar or other circumstances.
SECTION 11.6. Notices. Unless otherwise provided herein or in the
Credit Agreement, any notice or other communication herein required or permitted
to be given shall be given in the manner and become effective as set forth in
the Credit Agreement, as to any Pledgor, addressed to it at the address of the
Borrower set forth in the Credit Agreement and as to the Collateral Agent,
addressed to it at the address set forth in the Credit Agreement, or in each
case at such other address as shall be designated by such party in a written
notice to the other party complying as to delivery with the terms of this
Section 11.6.
SECTION 11.7. Governing Law, Consent to Jurisdiction and Service of
Process; Waiver of Jury Trial.
(i) This Agreement shall be construed in accordance with and
governed by the law of the State of New York, without regard to conflicts of law
principles that would require the application of the laws of another
jurisdiction.
(ii) Each Pledgor hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of the Supreme
Court of the State of New York sitting in New York County and of the United
States District Court of the Southern District of New York, and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to any Loan Document, or for recognition or enforcement of any judgment, and
each
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of the parties hereto hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in such New York State or, to the extent permitted by law, in such federal
court. Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement or any other Loan Document shall affect any right that
the Administrative Agent, the Issuing Bank or any Lender may otherwise have to
bring any action or proceeding relating to this Agreement or any other Loan
Document against any Loan Party or its properties in the courts of any
jurisdiction.
(iii) Each Pledgor hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection which it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any other Loan
Document in any court referred to in paragraph (ii) of this Section. Each of the
parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
(iv) Each Pledgor hereby irrevocably consents to service of process
in any action or proceeding arising out of or relating to any Loan Document, the
manner provided for notices in Section 11.01 of the Credit Agreement. Nothing in
this Agreement or any other Loan Document will affect the right of any party to
this Agreement to serve process in any other manner permitted by applicable law.
(v) Each Pledgor hereto hereby waives, to the fullest extent
permitted by applicable law, any right it may have to a trial by jury in any
legal proceeding directly or indirectly arising out of or relating to this
Agreement, any other Loan Document or the transactions contemplated hereby
(whether based on contract, tort or any other theory). Each party hereto (a)
certifies that no representative, agent or attorney of any other party has
represented, expressly or otherwise, that such other party would not, in the
event of litigation, seek to enforce the foregoing waiver and (b) acknowledges
that it and the other parties hereto have been induced to enter into this
Agreement by, among other things, the mutual waivers and certifications in this
Section
SECTION 11.8. Severability of Provisions. Any provision hereof 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 or
affecting the validity or enforceability of such provision in any other
jurisdiction.
SECTION 11.9. Execution in Counterparts. This Agreement and any
amendments, waivers, consents or supplements hereto may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed to be an original,
but all such counterparts together shall constitute one and the same agreement.
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SECTION 11.10. Business Days. In the event any time period or any
date provided in this Agreement ends or falls on a day other than a Business
Day, then such time period shall be deemed to end and such date shall be deemed
to fall on the next succeeding Business Day, and performance herein may be made
on such Business Day, with the same force and effect as if made on such other
day.
SECTION 11.11. Waiver of Stay. Each Pledgor covenants (to the extent
it may lawfully do so) that in the event that such Pledgor or any property or
assets of such Pledgor shall hereafter become the subject of a voluntary or
involuntary proceeding under the Code or such Pledgor shall otherwise be a party
to any federal or state bankruptcy, insolvency, moratorium or similar proceeding
to which the provisions relating to the automatic stay under Section 362 of the
Code or any similar provision in any such law is applicable, then, in any such
case, whether or not the Collateral Agent has commenced foreclosure proceedings
under this Agreement, such Pledgor shall not, and each Pledgor hereby expressly
waives its right to (to the extent it may lawfully do so) at any time insist
upon, plead or in any whatsoever, claim or take the benefit or advantage of any
such automatic stay or such similar provision as it relates to the exercise of
any of the rights and remedies (including any foreclosure proceedings) available
to the Collateral Agent as provided in this Agreement, in any other Security
Document or any other document evidencing the Obligations. Each Pledgor further
covenants (to the extent it may lawfully do so) that it will not hinder, delay
or impede the execution of any power granted herein to the Collateral Agent, but
will suffer and permit the execution of every such power as though no law
relating to any stay or similar provision had been enacted.
SECTION 11.12. No Credit for Payment of Taxes or Imposition. Such
Pledgor shall not be entitled to any credit against the principal, premium, if
any, or interest payable under the Credit Agreement, and such Pledgor shall not
be entitled to any credit against any other sums which may become payable under
the terms thereof or hereof, by reason of the payment of any Tax on the Pledged
Collateral or any part thereof.
SECTION 11.13. No Claims Against Collateral Agent. Nothing contained
in this Agreement shall constitute any consent or request by the Collateral
Agent, express or implied, for the performance of any labor or services or the
furnishing of any materials or other property in respect of the Pledged
Collateral or any part thereof, nor as giving any Pledgor any right, power or
authority to contract for or permit the performance of any labor or services or
the furnishing of any materials or other property in such fashion as would
permit the making of any claim against the Collateral Agent in respect thereof
or any claim that any Lien based on the performance of such labor or services or
the furnishing of any such materials or other property is prior to the Lien
hereof, except as expressly permitted by the Credit Agreement.
SECTION 11.14. No Release. Nothing set forth in this Agreement shall
relieve any Pledgor from the performance of any term, covenant, condition or
agreement on such Pledgor's part to be performed or observed under or in respect
of any of the Pledged Collateral or from any liability to any person under or in
respect of any of the Pledged Collateral or shall impose any obligation on the
Collateral Agent or any other Secured Party to perform or observe
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any such term, covenant, condition or agreement on such Pledgor's part to be so
performed or observed or shall impose any liability on the Collateral Agent or
any other Secured Party for any act or omission on the part of such Pledgor
relating thereto or for any breach of any representation or warranty on the part
of such Pledgor contained in this Agreement, the Credit Agreement or the other
Loan Documents, or under or in respect of the Pledged Collateral or made in
connection herewith or therewith. The obligations of each Pledgor contained in
this Section 11.14 shall survive the termination hereof and the discharge of
such Pledgor's other obligations under this Agreement, the Credit Agreement and
the other Loan Documents.
SECTION 11.15. Obligations Absolute. All obligations of each Pledgor
hereunder shall be absolute and unconditional irrespective of:
(i) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of any Pledgor;
(ii) any lack of validity or enforceability of the Credit Agreement,
any Hedging Agreement or any other Loan Document, or any other agreement
or instrument relating thereto;
(iii) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations, or any other amendment
or waiver of or any consent to any departure from the Credit Agreement,
any Hedging Agreement or any other Loan Document or any other agreement or
instrument relating thereto;
(iv) any pledge, exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to any
departure from any guarantee, for all or any of the Obligations;
(v) any exercise, non-exercise or waiver of any right, remedy, power
or privilege under or in respect hereof, the Credit Agreement, any Hedging
Agreement or any other Loan Document except as specifically set forth in a
waiver granted pursuant to the provisions of Section 11.5 hereof; or
(vi) any other circumstances which might otherwise constitute a
defense available to, or a discharge of, any Pledgor.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
IN WITNESS WHEREOF, the Pledgors and the Collateral Agent have
caused this Agreement to be duly executed and delivered by their duly authorized
officers as of the date first above written.
ICG, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
INTERNATIONAL COAL GROUP, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
ICG NATURAL RESOURCES, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
ICG ADDCAR SYSTEMS, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
ICG EAST KENTUCKY, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
-42-
ICG ILLINOIS, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
ICG EASTERN, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
ICG HAZARD, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
ICG ▇▇▇▇▇ COUNTY, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
ICG EASTERN LAND, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
-43-
ICG HAZARD LAND, LLC,
as Pledgor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Secretary
S-1
UBS AG, STAMFORD BRANCH,
as Collateral Agent
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
___________________________________________
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Associate Director, Banking Products
Services, US
By: /s/ ▇▇▇▇▇▇▇ ▇. Saint
___________________________________________
Name: ▇▇▇▇▇▇▇ ▇. Saint
Title: Director, Banking Products Services,
US