EXHIBIT 10.7
DOMESTIC SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of April 22, 1998, as amended and
restated as of November 10, 1998, made by UCAR INTERNATIONAL INC., a
Delaware corporation ("UCAR"), UCAR GLOBAL ENTERPRISES INC., a
Delaware corporation (the "BORROWER"), and the U.S. Subsidiaries
(together with UCAR and the Borrower, the "GRANTORS") in favor of
THE CHASE MANHATTAN BANK, a New York banking corporation, as
collateral agent for the Secured Parties (such term and each other
capitalized term used but not defined herein having the meaning
given it in Article I of the Credit Agreements). Reference is made
to (i) the Credit Agreement dated as of October 19, 1995, as amended
and restated as of March 19, 1997 and November 10, 1998 (as the same
may be amended, supplemented or otherwise modified from time to
time, the "EXISTING CREDIT AGREEMENT"), among UCAR, the Borrower,
the Subsidiary Borrowers party thereto, the Lenders party thereto,
the Fronting Banks party thereto and The Chase Manhattan Bank, as
administrative agent and collateral agent and (ii) the Credit
Agreement dated as of November 10, 1998, among UCAR, the Borrower,
UCAR S.A., the Lenders party thereto, The Chase Manhattan Bank, as
administrative agent and collateral agent, Credit Suisse First
Boston, as syndication agent, and ▇▇▇▇▇▇ Guaranty Trust Company of
New York, as syndication agent (as the same may be amended,
supplemented or otherwise modified from time to time, the "TRANCHE C
FACILITY CREDIT AGREEMENT", and together with the Existing Credit
Agreement, the "CREDIT AGREEMENTS").
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreements, the Lenders have
severally agreed to make Loans and the Fronting Banks have agreed to issue
Letters of Credit, upon the terms and subject to the conditions set forth
therein; and
WHEREAS, it is a condition precedent to the obligations of the
Lenders to make the Loans and the Fronting Banks to issue the Letters of Credit
that the Grantors, other than UCAR and the Borrower, guarantee payment and
performance of the Credit Parties' obligations under the Credit Agreements and
the other Loan Documents, that UCAR guarantee payment and performance of the
Borrower's obligations, including its obligations as a guarantor, under the
Credit Agreements and the other Loan Documents and that the Borrower guarantee
payment and performance of the other Credit Parties' obligations under the
Credit Agreements and the other Loan Documents;
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WHEREAS, in satisfaction of such condition, the Grantors have
entered into certain Guarantee Agreements for the benefit of the Secured
Parties;
WHEREAS, it is a further condition precedent to the obligations of
the Lenders to make the Loans and the Fronting Banks to issue the Letters of
Credit that the Grantors shall have executed and delivered this Security
Agreement; and
NOW, THEREFORE, in consideration of the premises and to induce the
Secured Parties to enter into the Credit Agreements and to induce the Lenders to
make their respective Loans and the Fronting Banks to issue their respective
Letters of Credit, each of the Grantors hereby agree with the Collateral Agent,
for the ratable benefit of the Secured Parties, as follows:
1. DEFINED TERMS.
1.1 DEFINITIONS. (a) Unless otherwise defined herein, terms defined
in the Credit Agreements and used herein shall have the meanings given in the
Credit Agreements, and the following terms which are defined in the Uniform
Commercial Code in effect in the State of New York on the date hereof are used
herein as so defined: Chattel Paper, Farm Products, Instruments and Vehicles.
(b) The following terms shall have the following meanings:
"ACCOUNTS": with respect to each Grantor, any and all right, title
and interest of such Grantor to payment for goods and services sold or
leased, including any such right evidenced by chattel paper, whether due
or to become due, whether or not it has been earned or performed, and
whether now or hereafter acquired or arising in the future, including,
without limitation, accounts receivable from Affiliates of such person,
except to the extent that the grant of a security interest in Accounts
owed by Affiliates not incorporated or otherwise organized in the United
States of America would result in material adverse tax or legal
consequences to such Grantor.
"ACCOUNTS RECEIVABLE": with respect to each Grantor, all right,
title and interest of such Grantor to Accounts and all of its right, title
and interest in any returned goods, together with all rights, titles,
securities and guaranties with respect thereto, including any rights to
stoppage in transit, replevin, reclamation and resales, and all related
security interests, liens and pledges, whether voluntary or involuntary in
each case whether due or become due, whether now or hereafter arising in
the future.
"AGREEMENT": this Security Agreement, as the same may be amended,
modified or otherwise supplemented from time to time.
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"CODE": the Uniform Commercial Code as from time to time in effect
in the State of New York.
"COLLATERAL": as defined in Section 2 of this Agreement.
"COLLATERAL ACCOUNT": any collateral account established by the
Collateral Agent as provided in Section 5.3 or Section 7.2.
"CONTRACTS": with respect to each Grantor, all rights of such
Grantor under contracts and agreements to which such Grantor is a party or
under which such Grantor has any right, title or interest or to which such
Grantor or any property of such Grantor is subject, as the same may from
time to time be amended, supplemented or otherwise modified, including,
without limitation, (a) all rights of such Grantor to receive moneys due
and to become due to it thereunder or in connection therewith, (b) all
rights of such Grantor to damages arising out of, or for, breach or
default in respect thereof and (c) all rights of such Grantor to exercise
all remedies thereunder, in each case to the extent the grant by such
Grantor of a security interest pursuant to this Agreement in its rights
under such contract or agreement is not prohibited without the consent of
any other person, or is permitted with consent if all necessary consents
to such grant of a security interest have been obtained from all such
other persons (it being understood that the foregoing shall not be deemed
to obligate such Grantor to obtain such consents); PROVIDED, that the
foregoing limitation shall not affect, limit, restrict or impair the grant
by such Grantor of a security interest pursuant to this Agreement in any
Account or any money or other amounts due or to become due under any such
contract or agreement to the extent provided in Section 9-318 of the Code
as in effect on the date hereof.
"DOCUMENTS": with respect to each Grantor, all Instruments, files,
records, ledger sheets, and documents covering or relating to any of the
Accounts, Equipment, General Intangibles, Inventory and Proceeds.
"EQUIPMENT": with respect to each Grantor, all equipment, furniture
and furnishings, tools, accessories, parts and supplies of every kind and
description, wherever located, now or hereafter existing, and all
improvements, accessions or appurtenances thereto, including Fixtures, and
all other tangible personal property whether or not similar to any of the
foregoing items which are now or hereafter acquired by such Grantor (it
being understood that "Equipment" does not include Vehicles).
"FIXTURES": with respect to each Grantor, all items that would
otherwise constitute items of Collateral, whether now owned or hereafter
acquired, that become so related to particular real estate that an
interest in them arises under any real estate law applicable thereto.
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"GENERAL INTANGIBLES": with respect to each Grantor, as defined in
the Uniform Commercial Code in effect in the State of New York on the date
hereof to the extent, in the case of any General Intangibles arising under
any contract or agreement, that the grant by such Grantor of a security
interest pursuant to this Agreement in its rights under such contract or
agreement is not prohibited without the consent of any other person, or is
permitted with consent if all necessary consents to such grant of a
security interest have been obtained from all such other persons (it being
understood that the foregoing shall not be deemed to obligate such Grantor
to obtain such consents), PROVIDED, that the foregoing limitation shall
not affect, limit, restrict or impair the grant by such Grantor of a
security interest pursuant to this Agreement in any Account or General
Intangible or any money or other amounts due or to become due under any
such contract or agreement to the extent provided in Section 9-318 of the
Code as in effect on the date hereof, and PROVIDED, FURTHER, that "General
Intangibles" shall not include any of the items within Section 2(h)
herein, except to the extent that the grant of a security interest in
General Intangibles owed by Affiliates not incorporated or otherwise
organized in the United States of America would result in material adverse
tax or legal consequences to such Grantor.
"INDEMNITEE": the Secured Parties and their respective officers,
directors, trustees, affiliates and controlling persons.
"INVENTORY": with respect to each Grantor, all right, title and
interest of such Grantor in and to goods intended for sale or lease by
such person, or consumed in such person's business (including, without
limitation, all operating parts and supplies), together with all raw
materials and finished goods, whether now owned or hereafter acquired or
arising.
"OBLIGATIONS": with respect to each Grantor, the collective
reference to its obligations as obligor or guarantor in respect of (i) the
unpaid principal of and premium, if any, and interest (including interest
accruing at the then applicable rate provided in the Existing Credit
Agreement after the maturity of the Loans thereunder and interest accruing
at the then applicable rate provided in the Existing Credit Agreement
after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to any Credit
Party thereunder whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding) on the Loans made under the
Existing Credit Agreement, when and as due, whether at maturity, by
acceleration, upon one or more dates set for prepayment or otherwise, (ii)
the unpaid principal of and premium, if any, and interest (including
interest accruing at the then applicable rate provided in the Tranche C
Facility Credit Agreement after the maturity of the Loans thereunder and
interest accruing at the applicable rate provided in the Tranche C
Facility Credit Agreement after the
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filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to any Credit
Party thereunder whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding) on the Loans made under the
Tranche C Facility Credit Agreement, when and as due, whether at maturity,
by acceleration, upon one or more dates set for prepayment or otherwise,
(iii) each payment required to be made by any Credit Party under the
Existing Credit Agreement, when and as due, including payments in respect
of reimbursements of L/C Disbursements, interest thereon and obligations
to provide cash collateral, (iv) each payment required to be made by any
Credit Party under the Tranche C Facility Credit Agreement, when and as
due, and (v) all other obligations and liabilities of every nature of the
Credit Parties under the Credit Agreements from time to time owed to the
Secured Parties or any of them, whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred
(including monetary obligations incurred during the pendency of any
bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding), which may
arise under, out of, or in connection with, the Existing Credit Agreement,
the Tranche C Facility Credit Agreement, any Guarantee Agreement, any
Security Document or any other Loan Document and any obligation of the
Borrower or any Credit Party under either of the Credit Agreements to a
Lender under either Credit Agreement pursuant to an Interest/Exchange Rate
Protection Agreement or under any other document made, delivered or given
in connection with any of the foregoing, in each case whether on account
of principal, interest, reimbursement obligations, fees, indemnities,
costs, expenses or otherwise (including all fees and disbursements of
counsel to the Collateral Agent or to the Secured Parties that are
required to be paid by the Borrower or any Credit Party pursuant to the
terms of the Existing Credit Agreement, the Tranche C Facility Credit
Agreement, any Guarantee Agreement, any Security Document, any other Loan
Document or any Interest/Exchange Rate Protection Agreement with a Lender.
"PROCEEDS": with respect to each Grantor, any consideration received
from the sale, exchange or other disposition of any asset or property
which constitutes Collateral owned by it, any value received as a
consequence of the possession of any such Collateral and any payment
received from any insurer or other person or entity as a result of the
destruction, loss, theft, damage or other involuntary conversion of
whatever nature of any asset or property which constitutes such
Collateral, and shall include, without limitation, (a) all cash and
negotiable instruments received or held on behalf of the Collateral Agent
pursuant to Section 5.3 and (b) any claim of such Grantor against a third
party for (and the right to ▇▇▇ and recover for and the rights to damages
or profits due or accrued arising out of or in connection with) any and
all amounts from time to time paid or payable under or in connection with
any of the Collateral.
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"U.S. SUBSIDIARY": a Subsidiary incorporated o rotherwise organized
in the United States of America.
1.2 OTHER DEFINITIONAL PROVISIONS. (a) The words "hereof," "herein"
and "hereunder" and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement, and Section references are to this Agreement unless otherwise
specified. The words "include", "includes" and "including" shall be deemed to be
followed by the phrase "without limitation".
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. GRANT OF SECURITY INTEREST. As collateral security for the prompt
and complete payment and performance when due, whether at the stated maturity,
by acceleration, upon one or more dates set for prepayment or otherwise of the
Obligations, each Grantor hereby grants to the Collateral Agent, for the ratable
benefit of the Secured Parties, a first priority security interest in all of the
following property now owned or at any time hereafter acquired by such Grantor,
subject to Permitted Liens (as defined below) (collectively, with respect to
each Grantor, the "COLLATERAL"):
(a) all Accounts Receivable;
(b) all Contracts;
(c) all Documents;
(d) all Equipment;
(e) all General Intangibles;
(f) all Instruments;
(g) all Inventory;
(h) all books and records pertaining to the Collateral; and
(i) to the extent not otherwise included, all Proceeds and products
of any and all of the foregoing.
Notwithstanding anything contained in this Agreement or any Loan Document to the
contrary, "Collateral" shall not include any property of the type specified in
Sections 2(b), (d) (to the extent such Equipment constitutes Fixtures), (e), (f)
and (g) if the granting of a Lien by such Grantor hereunder would violate the
terms of, or otherwise constitute a default under, any document or instrument to
which any Loan Party is a party (other than those documents or instruments
between or among the Loan Parties and/or their Affiliates only) relating to the
ownership of, or pertaining to any rights or interests held in such property,
provided that the terms to be violated or default that would result in the event
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of the granting of the Lien hereunder are typical or customary in connection
with the document or instrument to which they relate.
Such security interests are granted as security only and shall not
subject any Secured Party to, or in anyway alter or modify, any obligation or
liability of any Grantor with respect to or arising out of the Collateral.
3. REPRESENTATIONS AND WARRANTIES. Each Grantor hereby represents
and warrants, as to itself and the Collateral in which the security interest is
created by it hereunder, that:
3.1 TITLE; NO OTHER LIENS. Except for the security interest granted
to the Collateral Agent for the ratable benefit of the Secured Parties pursuant
to this Agreement and the other Liens permitted to exist pursuant to the Credit
Agreements (the "PERMITTED LIENS"), such Grantor owns each item of the
Collateral free and clear of any and all Liens or claims of others. No security
agreement, financing statement or other public notice with respect to all or any
part of such Collateral is on file or of record in any public office, except
such as have been filed, pursuant to this Agreement, in favor of the Collateral
Agent, for the ratable benefit of the Secured Parties, or in respect of
Permitted Liens.
3.2 AUTHORITY. Such Grantor has full power and authority to grant to
the Collateral Agent the security interest in such Collateral pursuant hereto
and to execute, deliver and perform its obligations in accordance with the terms
of this Agreement, without the consent or approval of any other person other
than any consent or approval that has been obtained.
3.3 ENFORCEABLE OBLIGATION; PERFECTED, FIRST PRIORITY SECURITY
INTERESTS. This Agreement constitutes a legal, valid and binding obligation of
such Grantor, enforceable against such Grantor in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency, moratorium,
reorganization or other similar laws affecting creditors' rights generally and
except as enforceability may be limited by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law), and the security interests granted pursuant to this Agreement
(a) upon completion of the filings and other actions specified in SCHEDULE I
attached hereto shall constitute perfected security interests in such Collateral
in favor of the Collateral Agent for the ratable benefit of the Secured Parties,
and (b) are prior to all other Liens (other than Permitted Liens) on such
Collateral in existence on the date hereof.
3.4 INVENTORY AND EQUIPMENT. The Inventory and the Equipment owned
by such Grantor are kept at the locations listed in SCHEDULE II hereto, which
shall be updated from time to time in accordance with Section 4.5 of this
Agreement, or at such other locations as shall be permitted by Section 4.4,
provided that in the case of any Equipment that in the ordinary course of a
Grantor's business is moved to a Vehicle, such Equipment may also be kept on or
near such Vehicle as is usual in the ordinary course of business.
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3.5 CHIEF EXECUTIVE OFFICE. As of the date hereof, such Grantor's
chief executive office and chief place of business is located at the location
listed in Section 9.01 of the Credit Agreements or under its signature set forth
below.
3.6 FARM PRODUCTS. None of such Collateral constitutes, or is the
Proceeds of, Farm Products.
4. COVENANTS. Each Grantor covenants and agrees with the Secured
Parties that, from and after the date of this Agreement until this Agreement is
terminated and the security interests created hereby are released:
4.1 DELIVERY OF INSTRUMENTS AND CHATTEL PAPER. If an Event of
Default shall have occurred and be continuing and if any amount payable under or
in connection with any of the Collateral owned by such Grantor shall be or
become evidenced by any promissory note, other instrument or chattel paper, upon
the request of the Collateral Agent, such promissory note, instrument or Chattel
Paper shall be immediately delivered to the Collateral Agent, duly indorsed in a
manner reasonably satisfactory to the Collateral Agent, to be held as Collateral
pursuant to this Agreement.
4.2 MAINTENANCE OF INSURANCE. Such Grantor shall maintain insurance
policies in accordance with the requirements of Section 5.02 of the Credit
Agreements.
4.3 MAINTENANCE OF PERFECTED SECURITY INTEREST; FURTHER
DOCUMENTATION. (a) Such Grantor shall cause all filings and other actions listed
in SCHEDULE I to be taken. Such Grantor shall maintain the security interests
created by this Agreement as first, perfected security interests subject only to
Permitted Liens and shall defend such security interests against all claims and
demands of all persons whomsoever (other than those pursuant to Permitted
Liens).
(b) At any time and from time to time, upon the written request of
the Collateral Agent, and at the sole expense of such Grantor, such Grantor
shall promptly and duly execute and deliver 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 of the rights and powers herein granted, including, without
limitation, the filing of any financing or continuation statements under the
Uniform Commercial Code in effect in any jurisdiction with respect to the
security interests created hereby.
4.4 CHANGES IN LOCATIONS, NAME, ETC. Such Grantor shall not, except
(x) upon prior written notice to the Collateral Agent and delivery to the
Collateral Agent of a written supplement to SCHEDULE II showing the additional
location or locations at which Inventory or Equipment shall be kept, and (y) if
filings under the UCC or otherwise have been made which maintain in favor of the
Collateral Agent a valid, legal and perfected security interest in such
Collateral subject to no liens, other than Permitted Liens,
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(a) permit any of the Inventory or Equipment owned by it to be kept
at a location other than those listed in SCHEDULE II hereto or Vehicles as
described in Section 3.4, except for Inventory and Equipment in transit
between locations described in this paragraph (a) or transferred to a
foreign Subsidiary in a transaction permitted by the Credit Agreements;
(b) change the location of its chief executive office and chief
place of business from that specified in Section 3.5; or
(c) change its (i) corporate name or any trade name used to identify
it in its conduct of business or in the ownership of its properties, (ii)
identity or (iii) corporate structure to such an extent that any financing
statement filed in favor of the Collateral Agent in connection with this
Agreement would become seriously misleading.
4.5 FURTHER IDENTIFICATION OF COLLATERAL. Such Grantor shall furnish
to the Collateral Agent from time to time statements and schedules further
identifying and describing the Collateral owned by it and such other reports in
connection with such Collateral as the Collateral Agent may reasonably request,
all in reasonable detail.
4.6 NOTICES. Such Grantor shall advise the Collateral Agent
promptly, in reasonable detail, at its address set forth in Section 9.01 of the
Credit Agreements of:
(a) any Lien (other than security interests created hereby or
Permitted Liens) on, any material portion of the Collateral; and
(b) of the occurrence of any other event which could reasonably be
expected to have a material adverse effect on the security interests
created hereby or on the aggregate value of (i) the Collateral owned by it
and (ii) all other Collateral (as such term is defined in the other
Security Documents) of the Borrower and its U.S. Subsidiaries taken as a
whole.
4.8 COLLATERAL AGENT'S LIABILITIES AND EXPENSES; INDEMNIFICATION.
(a) Notwithstanding anything to the contrary provided herein, the Collateral
Agent assumes no liabilities with respect to any claims regarding each Grantor's
ownership (or purported ownership) of, or rights or obligations (or purported
rights or obligations) arising from, the Collateral or any use (or actual or
alleged misuse) whether arising out of any past, current or future event,
circumstance, act or omission or otherwise, or any claim, suit, loss, damage,
expense or liability of any kind or nature arising out of or in connection with
the Collateral or the production, marketing, delivery, sale or provision of
goods or services under or in connection with any of the Collateral. All of such
liabilities shall, as between the Collateral Agent and the Grantors, be borne
exclusively by the Grantors.
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(b) Each Grantor hereby agrees to pay all expenses of the Collateral
Agent and to indemnify the Collateral Agent with respect to any and all losses,
claims, damages, liabilities and related expenses in respect of this Agreement
or the Collateral in each case to the extent the Borrower is required to do so
pursuant to Section 9.05 of the Credit Agreements.
(c) Any amounts payable by a Grantor as provided hereunder shall be
additional Obligations of it secured hereby and by the other Security Documents.
Without prejudice to the survival of any other agreements contained herein, all
indemnification and reimbursement obligations contained herein shall survive the
payment in full of the principal and interest under the Credit Agreements, the
expiration of the Letters of Credit and the termination of the Commitments or
this Agreement.
4.9 USE AND DISPOSITION OF COLLATERAL. A Grantor shall not (i) make
or permit to be made an assignment, pledge or hypothecation of the Collateral
owned by it, and shall grant no other security interest in such Collateral
(other than pursuant hereto or except for any Permitted Liens) or (ii) make or
permit to be made any transfer of such Collateral, and shall remain at all times
in possession thereof other than transfers to the Collateral Agent pursuant to
the provisions hereof; notwithstanding the foregoing, such Grantor may use and
dispose of such Collateral in any lawful manner not in violation of the
provisions of this Agreement, the Credit Agreements or any other Loan Document
to which it is a party, unless the Collateral Agent shall, after an Event of
Default shall have occurred and during the continuance thereof, notify such
Grantor not to sell, convey, lease, assign, transfer or otherwise dispose of any
such Collateral other than Inventory in the ordinary course of business,
Permitted Foreign Transfers and other than any other transfers between the
Borrower or a Wholly Owned Subsidiary that is a Grantor and a Borrower or a
Wholly Owned Subsidiary that is a Grantor.
5. PROVISIONS RELATING TO ACCOUNTS.
5.1 GRANTORS REMAIN LIABLE UNDER ACCOUNTS. Anything herein to the
contrary notwithstanding, a Grantor shall remain liable under each of the
Accounts to observe and perform all the conditions and obligations to be
observed and performed by it thereunder, all in accordance with the terms of any
agreement giving rise to each such Account. No Secured Party shall have any
obligation or liability under any Account (or any agreement giving rise thereto)
by reason of or arising out of this Agreement or the receipt by the Collateral
Agent or any Secured Party of any payment relating to such Account pursuant
hereto, nor shall any Secured Party be obligated in any manner to perform any of
the obligations of a Grantor under or pursuant to any Account (or any agreement
giving rise thereto), to make any payment, to make any inquiry as to the nature
or the sufficiency of any payment received by it or as to the sufficiency of any
performance by any party under any Account (or any agreement giving rise
thereto), to present or file any claim, to take any action to enforce any
performance or to collect the payment of any amounts which may
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have been assigned to it or to which it may be entitled at any time or times.
5.2 ANALYSIS OF ACCOUNTS. The Collateral Agent shall have the right
upon the occurrence and during the continuance of an Event of Default to make
test verifications of the Accounts in any manner and through any medium that it
considers reasonably advisable, and each Grantor shall furnish all such
assistance and information as the Collateral Agent may reasonably require in
connection with such test verifications. At any time and from time to time upon
the occurrence and during the continuance of an Event of Default, upon the
Collateral Agent's reasonable request and at the expense of each Grantor, each
Grantor shall cause independent public accountants or others reasonably
satisfactory to the Collateral Agent to furnish to the Collateral Agent reports
showing reconciliations, aging and test verifications of, and trial balances
for, the Accounts. Upon the occurrence and during the continuance of an Event of
Default, the Collateral Agent in its own name or in the name of others may
communicate with account debtors on the Accounts to verify with them to the
Collateral Agent's reasonable satisfaction the existence, amount and terms of
any Accounts.
5.3 COLLECTIONS ON ACCOUNTS. (a) The Collateral Agent hereby
authorizes each Grantor to collect the Accounts, and the Collateral Agent may
curtail or terminate said authority at any time after the occurrence and during
the continuance of an Event of Default. If required by the Collateral Agent at
any time after the occurrence and during the continuance of an Event of Default,
any payments of Accounts, when collected by a Grantor during the continuance of
such an Event of Default, (i) shall be forthwith (and, in any event, within two
Business Days) deposited by such Grantor in the exact form received, duly
indorsed by such Grantor to the Collateral Agent if required, in a Collateral
Account maintained under the sole dominion and control of and on terms and
conditions reasonably satisfactory to the Collateral Agent, subject to
withdrawal by the Collateral Agent as provided in Section 7.3, and (ii) until so
turned over, shall be held by such Grantor in trust for the Secured Parties,
segregated from other funds of such Grantor.
(b) At the Collateral Agent's reasonable request after the
occurrence and during the continuance of an Event of Default, each Grantor shall
deliver to the Collateral Agent all original and other documents evidencing, and
relating to, the agreements and transactions which gave rise to the Accounts,
including, without limitation, all original orders, invoices and shipping
receipts.
5.4 REPRESENTATIONS AND WARRANTIES. (a) As of the date hereof,
the place where each Grantor keeps its records concerning the Accounts is at
the location listed in SCHEDULE III hereto.
(b) As of the date hereof, the amounts owing with respect to
Accounts of obligors which are Governmental Authorities do not constitute more
than 15% of the average aggregate amount owing on the Accounts owing to UCAR,
the Borrower, and any
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Subsidiaries, taken as a whole, during the most recently ended period of twelve
consecutive calendar months.
5.5 COVENANTS. (a) The amount represented by each Grantor to the
Secured Parties from time to time as owing by each account debtor or by all
account debtors in respect of the Accounts shall at such time be in all material
respects the correct amount actually owing by such account debtor or debtors
thereunder.
(b) Upon the occurrence and during the continuance of an Event of
Default, a Grantor shall not grant any extension of the time of payment of any
of the Accounts Receivable, compromise, compound or settle the same for less
than the full amount thereof, release, wholly or partly, any person liable for
the payment thereof, or allow any credit or discount whatsoever thereon other
than extensions, credits, discounts, compromises or settlements granted or made
in the ordinary course of business if the Collateral Agent shall have instructed
the Grantors not to grant or make any such extension, credit, discount,
compromise, or settlement under any circumstances during the continuance of such
Event of Default.
(c) Unless a Grantor shall deliver prior written notice, identifying
the change of location for its books and records, such Grantor shall not remove
its books and records from the location specified in Section 5.4(a).
6. PROVISIONS RELATING TO CONTRACTS.
6.1 GRANTORS REMAIN LIABLE UNDER CONTRACTS. Anything herein to the
contrary notwithstanding, each Grantor shall remain liable under each Contract
to observe and perform all the conditions and obligations to be observed and
performed by it thereunder, all in accordance with and pursuant to the terms and
provisions of such Contract. No Secured Party shall have any obligation or
liability under any Contract by reason of or arising out of this Agreement or
the receipt by any such Secured Party of any payment relating to such Contract
pursuant hereto, nor shall any Secured Party be obligated in any manner to
perform any of the obligations of a Grantor under or pursuant to any Contract,
to make any payment, to make any inquiry as to the nature or the sufficiency of
any payment received by it or as to the sufficiency of any performance by any
party under any Contract, to present or file any claim, to take any action to
enforce any performance or to collect the payment of any amounts which may have
been assigned to it or to which it may be entitled at any time or times.
6.2 COMMUNICATION WITH CONTRACTING PARTIES. Upon the occurrence and
during the continuance of an Event of Default, the Collateral Agent in its own
name or in the name of others may communicate with parties to the Contracts to
verify with them to the Collateral Agent's satisfaction the existence, amount
and terms of any Contracts.
7. REMEDIES.
13
7.1 NOTICE TO ACCOUNT DEBTORS AND CONTRACT PARTIES. Upon the request
of the Collateral Agent at any time after the occurrence and during the
continuance of an Event of Default, a Grantor shall notify account debtors on
the Accounts and parties to the Contracts that the Accounts and the Contracts
have been assigned to the Collateral Agent for the ratable benefit of the
Secured Parties and that payments in respect thereof during the continuance of
such an Event of Default shall be made directly to the Collateral Agent.
7.2 PROCEEDS TO BE TURNED OVER TO COLLATERAL AGENT. In addition to
the rights of the Collateral Agent and the Secured Parties specified in Section
5.3 with respect to payments of Accounts, if an Event of Default shall occur and
be continuing, all Proceeds received by a Grantor consisting of cash, checks and
other near-cash items shall upon the Collateral Agent's request be held by such
Grantor in trust for the Secured Parties, segregated from other funds of such
Grantor, and shall, upon the Collateral Agent's request (it being understood
that the exercise of remedies by the Secured Parties in connection with an Event
of Default under Sections VII(g) and VII(h) of the Credit Agreements shall be
deemed to constitute a request by the Collateral Agent for the purposes of this
sentence) forthwith upon receipt by such Grantor, be turned over to the
Collateral Agent in the exact form received by such Grantor (duly indorsed by
such Grantor to the Collateral Agent, if required) and held by the Collateral
Agent in a Collateral Account maintained under the sole dominion and control of
the Collateral Agent and on terms and conditions reasonably satisfactory to the
Collateral Agent. All Proceeds while held by the Collateral Agent in a
Collateral Account (or by such Grantor in trust for the Collateral Agent and the
Secured Parties) shall subject to Section 7.3 continue to be held as collateral
security for all the Obligations and shall not constitute payment thereof until
applied as provided in Section 7.3.
7.3 APPLICATION OF PROCEEDS. If an Event of Default shall have
occurred and be continuing, and the Collateral Agent shall have requested a
Grantor to take any action set forth in Section 5.3(a) or 7.2 or the Collateral
Agent shall have taken any action pursuant to Section 7.4, the Collateral Agent
shall apply the proceeds as follows:
FIRST, to the payment of the reasonable costs and expenses of the
Collateral Agent as set forth in Sections 7.4 and 15;
SECOND, to the payment of all amounts of the Obligations owed to the
Secured Parties in respect of Loans made by them and outstanding and
amounts owing in respect of any L/C Disbursement or Letter of Credit or
under any Interest/Exchange Rate Protection Agreement, pro rata as among
the Secured Parties in accordance with the amount of such Obligations owed
to them;
THIRD, to the payment and discharge in full of the Obligations
(other than those referred to above), pro rata as among the Secured
Parties in accordance with the amount of such Obligations owed to them;
and
14
FOURTH, after payment in full of all Obligations, to the applicable
Grantor, or its successors or assigns, or to whomsoever may be lawfully
entitled to receive the same or as a court of competent jurisdiction may
direct, any Collateral then remaining.
7.4 CODE REMEDIES. If an Event of Default shall have occurred and be
continuing, the Collateral Agent, on behalf of the Secured Parties may exercise,
in addition to all other rights and remedies granted to them in this Agreement
and in any other instrument or agreement securing, evidencing or relating to the
Obligations, all rights and remedies of a secured party under the Code. Without
limiting the generality of the foregoing, the Collateral Agent, without demand
of performance or other demand, presentment, protest, advertisement or notice of
any kind (except any notice required by law referred to below) to or upon a
Grantor or any other person (all and each of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Collateral, or any
part thereof, and/or may forthwith sell, lease, assign, give option or options
to purchase, or otherwise dispose of and deliver the Collateral or any part
thereof (or contract to do any of the foregoing), in one or more parcels at
public or private sale or sales, at any exchange, broker's board or office of
any Secured Party or elsewhere upon such terms and conditions as it may deem
advisable and at such prices as it may deem best, for cash or on credit or for
future delivery without assumption of any credit risk. Any Secured Party shall
have the right upon any such public sale or sales, and, to the extent permitted
by law, upon any such private sale or sales, to purchase the whole or any part
of the Collateral so sold, free of (to the extent permitted by law) any right or
equity of redemption in a Grantor, which right or equity is hereby, to the
extent permitted by law, waived or released. Each Grantor further agrees, at the
Collateral Agent's request, to assemble the Collateral and make it available to
the Collateral Agent at places which the Collateral Agent shall reasonably
select, whether at such Grantor's premises or elsewhere. The Collateral Agent
shall apply the net proceeds of any such collection, recovery, receipt,
appropriation, realization or sale, after deducting all reasonable costs and
expenses incurred therein or incidental to the care or safekeeping of any of
such Collateral or reasonably relating to such Collateral or the rights of the
Collateral Agent and the Secured Parties hereunder, including, without
limitation, reasonable attorneys' fees and disbursements, to the payment in
whole or in part of the Obligations, in accordance with Section 7.3, and only
after such application and after the payment by the Collateral Agent of any
other amount required by any provision of law, including, without limitation,
Section 9-504(1)(c) of the Code, need the Collateral Agent account for the
surplus, if any, to such Grantor. If any notice of a proposed sale or other
disposition of such Collateral shall be required by law, such notice shall be in
writing and deemed reasonable and proper if given at least 10 days before such
sale or other disposition.
The Collateral Agent shall have absolute discretion as to the time
of application of any such proceeds, moneys or
15
balances in accordance with this Agreement. Upon any sale of the Collateral by
the Collateral Agent (including pursuant to a power of sale granted by statute
or under a judicial proceeding), the receipt of the Collateral Agent or of the
officer making the sale shall be a sufficient discharge to the purchaser or
purchasers of the Collateral so sold and such purchaser or purchasers shall not
be obligated to see to the application of any part of the purchase money paid
over to the Collateral Agent or such officer or be answerable in any way for the
misapplication thereof.
7.5 WAIVER; DEFICIENCY. Each Grantor waives and agrees not to assert
any rights or privileges it may acquire under Section 9-112 of the Code. Each
Grantor shall remain liable for any deficiency if the proceeds of any sale or
other disposition of the Collateral are insufficient to pay (i) in the case of
UCAR, its Obligations or those of the Borrower (including as guarantor) and (ii)
in the case of each other Grantor, the Obligations and the reasonable fees and
disbursements of any attorneys employed by any Secured Party to collect such
deficiency.
8. COLLATERAL AGENT'S APPOINTMENT AS ATTORNEY-IN-FACT; COLLATERAL
AGENT'S PERFORMANCE OF GRANTORS' OBLIGATIONS.
8.1 POWERS. Each Grantor hereby irrevocably constitutes and appoints
the Collateral Agent and any officer or agent thereof, with full power of
substitution, during the continuance of an Event of Default, as its true and
lawful attorney-in-fact, with full irrevocable power and authority in the place
and stead of such Grantor and in the name of such Grantor or in its own name
from time to time in the Collateral Agent's discretion, for the purpose of
carrying out the terms of this Agreement, to take any and all appropriate action
and to execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement, and, without limiting
the generality of the foregoing, such Grantor hereby gives the Collateral Agent
the power and right, on behalf of such Grantor, without notice to or assent by
such Grantor, to do the following upon the occurrence and during the continuance
of an Event of Default:
(a) in the name of such Grantor or its own name, or otherwise, to
take possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under any
Account, Instrument, General Intangible or Contract or with respect to any
other Collateral and to file any claim or to take any other action or
proceeding in any court of law or equity or otherwise deemed appropriate
by the Collateral Agent for the purpose of collecting any and all such
moneys due under any Account, Instrument, General Intangible or Contract
or with respect to any other Collateral whenever payable;
(b) to pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral (other than Permitted Liens), to effect
any repairs or any insurance called for by the terms of this Agreement and
to pay all or any part of the premiums therefor and the costs thereof,
16
(c) to execute, in connection with any sale provided for in Section
7.4 hereof, any endorsements, assignments or other instruments of
conveyance or transfer with respect to the Collateral; and
(d)(i) to direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Collateral Agent or as the Collateral Agent
shall direct; (ii) to ask or demand for, collect, receive payment of and
receipt for, any and all moneys, claims and other amounts due or to become
due at any time in respect of or arising out of any Collateral; (iii) to
sign and indorse any invoices, freight or express bills, bills of lading,
storage or warehouse receipts, drafts against debtors, assignments,
verifications, notices and other documents in connection with any of the
Collateral; (iv) to commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction to
collect the Collateral or any thereof and to enforce any other right in
respect of any Collateral; (v) to defend any suit, action or proceeding
brought against any Grantor with respect to any Collateral; (vi) to
settle, compromise or adjust any such suit, action or proceeding and, in
connection therewith, to give such discharges or releases as the
Collateral Agent may deem appropriate; and (vii) generally, to use, sell,
transfer, pledge and make any agreement with respect to or otherwise deal
with any of the Collateral as fully and completely as though the
Collateral Agent were the absolute owner thereof for all purposes, and to
do, at the Collateral Agent's option and at the expense of such Grantor,
at any time, or from time to time, all acts and things which the
Collateral Agent reasonably deems necessary to protect, preserve or
realize upon such Collateral and the Collateral Agent's and the Secured
Parties' security interests therein and to effect the intent of this
Agreement, all as fully and effectively as such Grantor might do.
8.2 PERFORMANCE BY COLLATERAL AGENT OF GRANTOR'S OBLIGATIONS. If any
Grantor fails to perform or comply with any of its agreements contained herein,
the Collateral Agent, at its option, but without any obligation so to do, may
perform or comply, or otherwise cause performance or compliance, with such
agreement.
8.3 GRANTOR'S REIMBURSEMENT OBLIGATION. The expenses of the
Collateral Agent reasonably incurred in connection with actions undertaken as
provided in this Section 8, together with interest thereon at a rate per annum
equal to the default rate of interest set forth in Section 2.07 of the Credit
Agreements, from the date payment is demanded by the Collateral Agent to the
date reimbursed by a Grantor, shall be payable by the Borrower to the Collateral
Agent on demand.
8.4 RATIFICATION; POWER COUPLED WITH AN INTEREST. Each Grantor
hereby ratifies all that said attorneys shall lawfully do or cause to be done by
virtue hereof. All powers, authorizations and agencies contained in this
Agreement are coupled with an interest and are irrevocable until this Agreement
17
is terminated and the security interests created hereby are released.
9. DUTY OF COLLATERAL AGENT. The Collateral Agent's sole duty with
respect to the custody, safekeeping and physical preservation of the Collateral
in its possession, under Section 9-207 of the Code or otherwise, shall be to
deal with it in the same manner as the Collateral Agent deals with similar
property for its own account. No Secured Party nor any of its respective
directors, officers, employees or agents shall be liable for failure to demand,
collect or realize upon any of the Collateral or for any delay in doing so or
shall be under any obligation to sell or otherwise dispose of any Collateral
upon the request of a Grantor or any other person or to take any other action
whatsoever with regard to the Collateral or any part thereof. The powers
conferred on the Secured Parties hereunder are solely to protect the Secured
Parties' interests in the Collateral and shall not impose any duty upon any
Secured Party to exercise any such powers. The Secured Parties shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
employees or agents shall be responsible to any Grantor for any act or failure
to act hereunder, except for their own gross negligence or willful misconduct.
10. EXECUTION OF FINANCING STATEMENTS. Pursuant to Section 9-402 of
the Code, each Grantor authorizes the Collateral Agent to file financing
statements with respect to the Collateral without the signature of such Grantor
in such form and in such filing offices as the Collateral Agent reasonably
determines appropriate to perfect the security interests of the Collateral Agent
under this Agreement. A carbon, photographic or other reproduction of this
Agreement shall be sufficient as a financing statement for filing in any
jurisdiction.
11. AUTHORITY OF COLLATERAL AGENT. Each Grantor acknowledges that
the rights and responsibilities of the Collateral Agent under this Agreement
with respect to any action taken by the Collateral Agent or the exercise or
non-exercise by the Collateral Agent of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising
out of this Agreement shall, as between the Collateral Agent and the other
Secured Parties, be governed by the Credit Agreements and by such other
agreements with respect thereto as may exist from time to time among them but,
as between the Collateral Agent and the Grantors, the Collateral Agent shall be
conclusively presumed to be acting as agent for the other Secured Parties with
full and valid authority so to act or refrain from acting.
12. NOTICES. All notices, requests and demands to or upon the
Secured Parties or the Grantors under this Agreement shall be given or made in
accordance with Section 9.01 of the Credit Agreements and addressed as follows:
(a) if to any Secured Party or any Credit Party, in accordance with
Section 9.01 of the Credit Agreements;
18
(b) if to any Grantor that is not a Credit Party, at its address
set forth under its signature below.
13. SECURITY INTEREST ABSOLUTE. All rights of the Collateral Agent
hereunder, the security interest and all obligations of the Grantors hereunder
shall be absolute and unconditional.
14. SURVIVAL OF AGREEMENT. All covenants, agreements,
representations and warranties made by any Grantor herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Secured Parties and shall survive the making by the
Lenders of the Loans, the execution and delivery to the Lenders of the Loan
Documents and the issuance of any Letters of Credit, regardless of any
investigation made by the Secured Parties or on their behalf, and shall continue
in full force and effect as long as the principal of or any accrued interest on
any Loan or L/C Disbursement, or any Fee or any other amount payable under or in
respect of this Agreement or any other Loan Document is outstanding and unpaid
and so long as any Letter of Credit is outstanding and so long as the
Commitments have not been terminated.
15. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS. 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 AND THE OTHER LOAN DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 15.
16. JURISDICTION; CONSENT TO SERVICE OF PROCESS. (a) Each Grantor
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or Federal court of
the United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement or the other Loan Documents, or for recognition or enforcement of any
judgment, and each 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 shall affect any right that any Loan Party or any
Secured Party may otherwise have to bring any action or proceeding relating to
this Agreement or the other Loan Documents against any Grantor or any Secured
Party or its properties in the courts of any jurisdiction.
19
(b) Each Grantor and each Secured Party hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection that it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement or
the other Loan Documents in any New York State or Federal court. 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.
(c) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 12. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
17. RELEASE. (a) This Agreement and the security interest created
hereunder shall terminate when all Obligations have been fully and indefeasibly
paid and when the Secured Parties have no further Commitments under the Credit
Agreements and no Letters of Credit are outstanding, at which time the
Collateral Agent shall execute and deliver to each Grantor, or to such person or
persons as such Grantor shall reasonably designate, all Uniform Commercial Code
termination statements and similar documents prepared by such Grantor at its
expense which such Grantor shall reasonably request to evidence such
termination. Any execution and delivery of termination statements or documents
pursuant to this Section 17(a) shall be without recourse to or warranty by the
Collateral Agent.
(b) All Collateral used, sold, transferred or otherwise disposed of,
in accordance with the terms of the Credit Agreements (including pursuant to a
waiver or amendment of the terms thereof) shall be used, sold, transferred or
otherwise disposed of free and clear of the Lien and the security interest
created hereunder. In connection with the foregoing, (i) the Collateral Agent
shall execute and deliver to each Grantor, or to such person or persons as such
Grantor shall reasonably designate, all Uniform Commercial Code termination
statements and similar documents prepared by such Grantor at its expense which
such Grantor shall reasonably request to evidence the release of the Lien and
security interest created hereunder with respect to such Collateral and (ii) any
representation, warranty or covenant contained herein relating to such
Collateral shall no longer be deemed to be made with respect to such used, sold,
transferred or otherwise disposed Collateral.
18. SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. The parties hereunder
shall endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions, the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
20
19. AMENDMENTS IN WRITING; NO WAIVER; CUMULATIVE REMEDIES.
19.1 AMENDMENTS IN WRITING. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except by a
written instrument executed by the Grantors and the Collateral Agent, PROVIDED
that any provision of this Agreement may be waived by the Required Secured
Parties pursuant to a letter or agreement executed by the Collateral Agent or by
telecopy transmission from the Collateral Agent.
19.2 NO WAIVER BY COURSE OF CONDUCT. No Secured Party shall by any
act (except by a written instrument pursuant to Section 19.1 hereof) or delay be
deemed to have waived any right or remedy hereunder or to have acquiesced in any
Default or Event of Default or in any breach of any of the terms and conditions
hereof. No failure to exercise, nor any delay in exercising, on the part of any
Secured Party, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by any Secured Party of any
right or remedy hereunder on any one occasion shall not be construed as a bar to
any right or remedy which such Secured Party would otherwise have on any future
occasion.
20. REMEDIES CUMULATIVE. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other rights or remedies provided by law.
21. SECTION HEADINGS. The section and Section headings used in this
Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation hereof.
22. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
successors and assigns of each Grantor and shall inure to the benefit of each
Grantor and the Secured Parties and their successors and assigns, PROVIDED that
this Agreement may not be assigned by any Grantor without the prior written
consent of the Collateral Agent.
21
23. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
24. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original but all of which when
taken together shall constitute but one contract.
25. ADDITIONAL GRANTORS. Pursuant to Section 5.11 of the Credit
Agreements, each U.S. Subsidiary that was not in existence or not a U.S.
Subsidiary on the date thereof is required to enter into this Agreement as a
Grantor upon becoming a U.S. Subsidiary. Upon execution and delivery, after the
date hereof, by the Collateral Agent and such U.S. Subsidiary of an instrument
in the form of Exhibit A-1, such U.S. Subsidiary shall become a Grantor
hereunder with the same force and effect as if originally named as a Grantor
hereunder. The execution and delivery of any such instrument shall not require
the consent of any Grantor hereunder. The rights and obligations of each Grantor
hereunder shall remain in full force and effect notwithstanding the addition of
any new Grantor as a party to this Agreement.
22
IN WITNESS WHEREOF, the undersigned has caused this Security
Agreement to be duly executed and delivered as of the date first above written.
UCAR INTERNATIONAL INC.
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Controller
UCAR GLOBAL ENTERPRISES INC.
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Controller
EACH OF THE SUBSIDIARY GRANTORS
LISTED ON SCHEDULE IV HERETO
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Attorney-in-Fact
THE CHASE MANHATTAN BANK,
as Collateral Agent,
by /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
23
SCHEDULES:
Schedule I Filings and Other Actions Required to Perfect
Security Interests
Schedule II Inventory and Equipment
Schedule III Records of Accounts
Schedule IV Subsidiary Grantors
SCHEDULE I
TO SECURITY AGREEMENT
FILINGS AND OTHER ACTIONS
REQUIRED TO PERFECT SECURITY INTERESTS
Filings
I. Filing Offices for: UCAR Carbon Company Inc.
UCAR Carbon Technology Corporation
a. California:
(i) Orange County Clerk and Recorder
▇▇▇▇▇ ▇▇▇, ▇▇ ▇▇▇▇▇
(ii) Secretary of State, California
b. Connecticut:
(i) Town Clerk Danbury
(ii) Secretary of State, Connecticut
c. Illinois:
(i) ▇▇▇▇▇▇▇▇ County Recorder
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(ii) Secretary of State, Illinois
d. New York:
(i) Niagara County Clerk
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(ii) Secretary of State, New York
e. Ohio:
(i) Cuyahoga County Recorder
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(ii) Secretary of State, Ohio
f. Tennessee: (UCAR Carbon Company Inc. Only)
(i) ▇▇▇▇▇▇▇▇ County Register of Deeds
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(ii) Maury County Register of Deeds
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(iii) ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(iv) Secretary of State, Tennessee
g. West Virginia:
(i) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(ii) Secretary of State, West Virginia
II. Filing Offices for: UCAR Holdings Inc.
UCAR Holdings II, Inc.
UCAR Holdings III, Inc.
UCAR Carbon Foreign Sales Corporation
UCAR Composites Inc.
UCAR International Trading Inc.
a. Connecticut:
(i) Town Clerk Danbury
(ii) Secretary of State, Connecticut
b. Ohio:
(i) Cuyahoga County Recorder
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(ii) Secretary of State, Ohio
c. California (UCAR International Trading Inc.
Only):
(i) Orange County Clerk and Recorder
▇▇▇▇▇ ▇▇▇, ▇▇ ▇▇▇▇▇
(ii) Secretary of State, California
III. Filing Offices for UCAR International Inc. and UCAR
Global Enterprises Inc.:
a. Connecticut
(i) Town Clerk Danbury
(ii) Secretary of State, Connecticut
b. New York:
(i) County Clerk, New York County
(ii) Secretary of State, New York
c. Ohio:
(i) Cuyahoga County Recorder
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(ii) Secretary of State, Ohio
IV. Filing Offices for Mortgages of UCAR Carbon Company
Inc.:
a. Ohio:
(i) Cuyahoga County Recorder
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(ii) Secretary of State, Ohio
b. Tennessee:
(i) ▇▇▇▇▇▇▇▇ County Register of Deeds
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(ii) Maury County Register of Deeds
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(iii) ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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(iv) Secretary of State, Tennessee
c. West Virginia:
(i) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
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(ii) Secretary of State, West Virginia
d. New York:
(i) Niagara County Clerk
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(ii) Secretary of State, New York
e. Illinois:
(i) ▇▇▇▇▇▇▇▇ County Clerk
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(ii) Secretary of State, Illinois
SCHEDULE II
TO SECURITY AGREEMENT
INVENTORY AND EQUIPMENT LOCATIONS
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Anmoore, WV 26323
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Hwy 79N @
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SCHEDULE III
TO SECURITY AGREEMENT
RECORDS OF ACCOUNTS
Description
All records concerning the accounts of UCAR International Inc., UCAR
International Acquisitions Inc., UCAR Global Enterprises Inc. and the U.S.
Subsidiaries are located at:
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SCHEDULE IV
TO THE SECURITY AGREEMENT
SUBSIDIARY GRANTORS
UCAR Carbon Company Inc.
UCAR Carbon Technology Corporation
UCAR Holdings Inc.
UCAR Holdings II Inc.
UCAR Holdings III Inc.
UCAR International Trading Inc.
Union Carbide Grafito, Inc.
UCAR Composites Inc.
1
EXHIBIT A-1 TO
SECURITY AGREEMENT
SUPPLEMENT NO. dated as of [ ], to the Security
Agreement dated as of April 22, 1998, as amended and
restated as of November 10, 1998 (the "SECURITY AGREEMENT"),
among UCAR INTERNATIONAL INC., a Delaware corporation
("UCAR"), UCAR GLOBAL ENTERPRISES INC., a Delaware
corporation as borrower (the "BORROWER"), each of the U.S.
Subsidiaries (such term and each other capitalized term used
but not defined having the meaning given it in the Security
Agreement, and if not defined therein, having the meaning
given it in Article I of the Credit Agreements), party
thereto (together with the Borrower, the "GRANTORS") and THE
CHASE MANHATTAN BANK, a New York banking corporation, as
collateral agent (the "COLLATERAL AGENT") for the Secured
Parties.
A. Reference is made to (i) the Credit Agreement dated as of October
19, 1995, as amended and restated as of March 19, 1997 and November 10, 1998 (as
the same may be amended, supplemented or otherwise modified from time to time,
the "EXISTING CREDIT AGREEMENT"), among UCAR, the Borrower, the Subsidiary
Borrowers party thereto, the Lenders party thereto, the Fronting Banks party
thereto and The Chase Manhattan Bank, as administrative agent and collateral
agent and (ii) the Credit Agreement dated as of November 10, 1998, among UCAR,
the Borrower, UCAR S.A., the Lenders party thereto, The Chase Manhattan Bank, as
administrative agent and collateral agent, Credit Suisse First Boston, as
syndication agent, and ▇▇▇▇▇▇ Guaranty Trust Company of New York, as syndication
agent (as the same may be amended, supplemented or otherwise modified from time
to time, the "TRANCHE C FACILITY CREDIT AGREEMENT", and together with the
Existing Credit Agreement, the "CREDIT AGREEMENTS").
B. The Grantors have entered into the Security Agreement in order to
induce the Lenders to make Loans and the Fronting Banks to issue Letters of
Credit pursuant to, and upon the terms and subject to the conditions specified
in, the Credit Agreements. Pursuant to Section 5.11 of the Credit Agreements,
each U.S. Subsidiary that was not in existence or not a U.S. Subsidiary on the
date thereof is required to enter into the Security Agreement as a Grantor upon
becoming a U.S. Subsidiary. Section 25 of the Security Agreement provides that
additional U.S. Subsidiaries may become Grantors under the Security Agreement by
execution and delivery of an instrument in the form of this Supplement. The
undersigned (the "NEW GRANTOR") is a U.S. Subsidiary and is executing this
Supplement in accordance with the requirements of the Credit Agreements to
become a Grantor under the Security Agreement in order to induce the Lenders to
make additional Loans and the Fronting Banks to issue additional
2
Letters of Credit and as consideration for Loans previously made and Letters of
Credit previously issued.
Accordingly, the Collateral Agent and the New Grantor agree as
follows:
SECTION 1. In accordance with Section 25 of the Security Agreement,
the New Grantor by its signature below becomes a Grantor under the Security
Agreement with the same force and effect as if originally named therein as a
Grantor and the New Grantor hereby agrees to all the terms and provisions of the
Security Agreement applicable to it as a Grantor thereunder. Each reference to a
"Grantor" in the Security Agreement shall be deemed to include the New Grantor.
The Security Agreement is hereby incorporated herein by reference.
SECTION 2. The New Grantor represents and warrants to the Secured
Parties that this Supplement has been duly authorized, executed and delivered by
it and constitutes its legal, valid and binding obligation, enforceable against
it in accordance with its terms, subject to the effects of applicable
bankruptcy, insolvency or similar laws effecting creditors' rights generally and
equitable principles of general applicability.
SECTION 3. This Supplement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument. This Supplement shall
become effective when the Collateral Agent shall have received counterparts of
this Supplement that, when taken together, bear the signatures of the New
Grantor and the Collateral Agent.
SECTION 4. Except as expressly supplemented hereby, the Security
Agreement shall remain in full force and effect.
SECTION 5. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 6. In case any one or more of the provisions contained in
this Supplement should be held invalid, illegal or unenforceable in any respect,
neither party hereto shall be required to comply with such provision for so long
as such provision is held to be invalid, illegal or unenforceable, but the
validity, legality and enforceability of the remaining provisions contained
herein and in the Security Agreement shall not in any way be affected or
impaired. The parties hereto shall endeavor in good-faith negotiations to
replace the invalid, illegal or unenforceable provisions with valid provisions
the economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.
SECTION 7. All communications and notices hereunder shall be in
writing and given as provided in the Credit Agreements. All communications and
notices hereunder to the New Grantor shall be given to it at the address set
forth under its signature, with a copy to the Borrower.
3
IN WITNESS WHEREOF, the New Grantor and the Collateral Agent have
duly executed this Supplement to the Security Agreement as of the day and year
first above written.
[NAME OF NEW GRANTOR],
by
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Name:
Title:
Address:
THE CHASE MANHATTAN BANK, as
Collateral Agent,
by
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Name:
Title: