Page 77 of 108 Pages
SECURITY AND PLEDGE AGREEMENT
dated as of June 29, 1998
between
GEOTEK COMMUNICATIONS, INC.,
GEOTEK USA, INC. and SUBSIDIARIES, as
Debtors and Debtors-in-Possession
and
S-C RIG INVESTMENTS III, L.P.
Page 78 of 108 Pages
Table of Contents
Page
ARTICLE 1 DEFINITIONS.........................................................1
Section 1.1 Definitions........................................1
ARTICLE 2 COLLATERAL..........................................................4
Section 2.1 Security Interest in the Collateral................4
ARTICLE 3 REPRESENTATIONS AND WARRANTIES......................................7
Section 3.1 Representations and Warranties.....................7
ARTICLE 4 CASH PROCEEDS OF COLLATERAL.........................................8
Section 4.1 Collateral Account.................................8
Section 4.2 Proceeds of Collateral.............................8
ARTICLE 5 FURTHER ASSURANCES; REMEDIES................................9
Section 5.1 Further Assurances; Remedies.......................9
(a) Delivery and Other Perfection......................9
(b) Preservation of Rights............................10
(c) Special Provisions Relating to Certain Collateral.10
(d) Events of Default, Etc............................11
(e) FCC Approval......................................12
Section 5.2 Deficiency........................................12
Section 5.3 Removals, Etc.....................................12
Section 5.4 Application of Proceeds...........................13
Section 5.5 Attorney-in-Fact..................................13
Section 5.6 Perfection........................................13
Section 5.7 Termination.......................................13
Section 5.8 Expenses and Indemnities..........................13
Section 5.9 Further Assurances................................14
Section 5.10 Releases..........................................14
Section 5.11 Other Financing Statements and Liens..............14
ARTICLE 6 MISCELLANEOUS..............................................15
Section 6.1 No Waiver.........................................15
Section 6.2 Notices...........................................15
Section 6.3 Amendments, Etc...................................15
Section 6.4 Successors and Assigns............................15
Section 6.5 Captions..........................................15
Section 6.6 Counterparts......................................15
Section 6.7 Governing Law.....................................15
Section 6.8 Severability......................................15
i
Page 79 of 108 Pages
ANNEXES
Annex 1 List of SMR Licenses
Annex 2A Pledged Issuer Interests
Annex 2B Pledged Investment Interests
Annex 3 Locations
ii
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SECURITY AND PLEDGE AGREEMENT
SECURITY AND PLEDGE AGREEMENT, dated as of June 29, 1998 by and among
GEOTEK COMMUNICATIONS, INC., a Delaware corporation and a debtor and
debtor-in-possession, GEOTEK USA, INC., a Delaware corporation and a debtor and
debtor-in-possession (together the "Borrowers") and their direct and indirect
wholly-owned SUBSIDIARIES signatories hereto, who are also debtors and
debtors-in-possession (the "Subsidiaries;" collectively with the Borrowers, the
"Pledgors") and S-C RIG INVESTMENTS III, L.P., a Delaware limited partnership
(the "Lender").
W I T N E S S E T H:
WHEREAS, the Borrowers and the Lender have entered into a Credit
Agreement (as amended and in effect from time to time, the "Credit Agreement"),
dated as of June 29, 1998, pursuant to which the Lender has agreed to provide
the Borrowers with a $10,000,000 working capital loan facility available in two
tranches, upon the terms and subject to the conditions set forth therein;
WHEREAS, it is a condition precedent to the effectiveness of the
Credit Agreement that the Pledgors shall have executed and delivered to the
Lender a Security and Pledge Agreement in substantially the form hereof;
NOW THEREFORE, in consideration of the premises and the agreements
herein and in order to induce the Lender to make the Loan, the Pledgors hereby
agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.1 Definitions. All terms used in this Agreement that are not
otherwise defined shall have the meanings assigned to such terms in the Credit
Agreement. As used in this Agreement, the following terms shall have the
respective meanings indicated below, such meanings to be applicable equally to
both the singular and plural forms of the terms defined:
"Account" shall mean any "account" as such term is defined in section
9-106 of the UCC, now owned or hereafter acquired by any Pledgor and, in any
event, includes, without limitation, (i) all accounts receivable, book debts and
other forms of obligations (other than forms of obligations evidenced by Chattel
Paper, Documents or Instruments) now owned or hereafter received or acquired by
or belonging or owing to any Pledgor (including, without limitation, under any
Page 81 of 108 Pages
trade name, style or division thereof) whether arising out of goods sold or
services rendered by any Pledgor or from any other transaction, whether or not
the same involves the sale of goods or services by a Pledgor (including, without
limitation, any such obligation which might be characterized as an account or
contract right under the UCC), (ii) all of the rights of any Pledgor in, to and
under all purchase orders or receipts now owned or hereafter acquired by it for
goods or services, and all rights of any Pledgor to any goods represented by any
of the foregoing (including, without limitation, unpaid seller's rights of
rescission, replevin, reclamation and stoppage in transit and rights to
returned, reclaimed or repossessed goods), (iii) all moneys due or to become due
to any Pledgor under all contracts for the sale of goods or the performance of
services or both by any Pledgor (whether or not yet earned by performance on the
part of any Pledgor or in connection with any other transaction), now in
existence or hereafter occurring, including, without limitation, the right to
receive the proceeds of said purchase orders and contracts, and (iv) all
collateral security and guarantees of any kind given by any Person with respect
to any of the foregoing.
"Agreement" shall mean this Security and Pledge Agreement, as the same
may be modified, supplemented or amended from time to time in accordance with
its terms.
"Chattel Paper" means any "chattel paper," as such term is defined in
section 9-105(1)(b) of the UCC, now owned or hereafter acquired by any Pledgor.
"Collateral" shall have the meaning assigned to that term under
Section 2.1 hereof.
"Collateral Account" shall have the meaning assigned to that term in
Section 4.1 hereof.
"Contracts" shall mean all contracts, undertakings or other agreements
(other than Chattel Paper, Documents or Instruments) in or under which any
Pledgor may now or hereafter have any right, title or interest, any agreement
relating to the terms of payment or the terms of performance thereof.
"Documents" shall mean any "document," as such term is defined in
section 9-105(1)(f) of the UCC, now owned or hereafter acquired by any Pledgor.
"Domestic Issuers" shall mean, collectively, the direct and indirect
Subsidiaries of the Borrowers so identified on Annex 2A hereto and any other
corporation that becomes a direct or indirect Subsidiary of the Borrowers at any
time after the date of this Agreement.
"Equipment" shall mean any "equipment," as such term is defined in
section 9-109(2) of the UCC, now owned or hereafter acquired by any Pledgor and,
Page 82 of 108 Pages
in any event, includes, without limitation, all machinery, equipment,
furnishings, fixtures, vehicles, computers and other electronic data-processing
and office equipment now owned or hereafter acquired by any Pledgor and any and
all additions, substitutions and replacements of any of the foregoing, wherever
located, together with all attachments, components, parts, equipment and
accessories installed thereon or affixed thereto.
"FCC" shall mean the U.S. Federal Communications Commission.
"Foreign Issuers" shall mean, collectively, the direct and indirect
Subsidiaries of the Borrowers so identified on Annex 2B hereto.
"General Intangibles" means any "general intangibles," as such term is
defined in section 9-106 of the UCC, now owned or hereafter acquired by any
Pledgor and, in any event, includes, without limitation, to the extent grantable
by applicable law, any SMR Licenses granted to a Pledgor or under which any
Pledgor has any rights, as the same may from time to time be amended,
supplemented, or otherwise modified, including, without limitation, (i) all
rights of any Pledgor to receive moneys due and to become due to it thereunder
or in connection therewith, (ii) all right of any Pledgor to damages arising
thereunder and (iii) all rights of any Pledgor to perform and to exercise all
remedies thereunder, all customer lists, trademarks, patents, rights in
intellectual property, licenses, permits, copyrights, trade secrets, proprietary
or confidential information, inventions (whether patented or patentable or not)
and technical information, procedures, designs, knowledge, know-how, software,
data bases, data, skill, expertise, experience, processes, models, drawings,
materials and records, goodwill, rights of indemnification and all right, title
and interest which any Pledgor may now or hereafter have in or under any
Contract, now owned or hereafter acquired by any Pledgor.
"Governmental Authority" shall mean (i) any government or political
subdivision thereof, whether foreign or domestic, national, state, county,
municipal or regional or any other government authority, (ii) any agency or
other instrumentality of any such government, political subdivision or other
governmental entity (including any central bank or comparable agency), (iii) any
court, arbitral tribunal or arbitrator and (iv) any non-governmental regulating
body, to the extent that the rules, regulations or orders of such body have the
force of law.
"Instrument" means any "instrument," as such term is defined in
section 9-105(1)(i) of the UCC, now owned or hereafter acquired by any Pledgor
other than instruments that constitute, or are a part of a group of writings
that constitute, Chattel Paper.
"Interests Collateral" shall have the meaning assigned to such term in
Section 2.1(e) hereof.
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"Inventory" means any "inventory," as such term is defined in section
9-109(4) of the UCC, now owned or hereafter acquired by any Pledgor, and
wherever located, and, in any event, includes, without limitation, all
inventory, merchandise, goods and other personal property now owned or hereafter
acquired by any Pledgor which are held for sale or lease or are furnished or are
to be furnished under a contract of service or which constitute raw materials,
work in process or materials used or consumed or to be used or consumed in the
business of any Pledgor, or the processing, packaging, delivery or shipping of
the same, and all finished goods.
"Issuers" shall mean, collectively, the Subsidiaries of the Borrowers
identified on Annex 2A and B hereto and any other corporation that becomes a
direct or indirect Subsidiary of the Borrowers at any time after the date of
this Agreement.
"Pledged Interests" shall have the meaning assigned to such term in
Section 2.1(c) hereof.
"SMR Licenses" shall have the meaning assigned to such term under
Section 2.1(a) hereof.
"UCC" shall mean the Uniform Commercial Code as in effect from time to
time in the State of New York; provided, however, in the event that, by reason
of mandatory provisions of law, any or all of the attachment, perfection or
priority of the Lender's Lien and security interest in any Collateral is
governed by the Uniform Commercial Code as in effect in a jurisdiction other
than the State of New York, the term "UCC" shall mean the Uniform Commercial
Code as in effect in such other jurisdiction for purposes of the provisions
hereof relating to such attachment, perfection or priority and for purposes of
definition related to such provisions.
ARTICLE 2
COLLATERAL
Section 2.1 Security Interest in the Collateral. As collateral
security for the prompt payment in full when due (whether at stated maturity, by
acceleration or otherwise) of the Obligations, the Pledgors hereby pledge, grant
and assign to the Lender a Lien and security interest in all right, title and
interest of the Pledgors in the following property, whether now owned by the
Pledgors or hereafter acquired, and whether now existing or hereafter coming
into existence (all being collectively referred to herein as "Collateral"):
(a) all grantable rights of the Pledgors in and to the special
mobile radio licenses identified in Annex 1 hereto (the "SMR Licenses"),
including any replacement licenses under the PageNet Agreement described in
clause (f) hereto;
Page 84 of 108 Pages
(b) the shares of capital stock or equity or ownership interests
of each Issuer represented by the certificates identified in Annex 2A hereto and
all other shares of capital stock or equity or ownership interests of whatever
class of each Issuer, now or hereafter owned by the Pledgors, in each case,
together with the certificates representing the same (collectively, the "Issuer
Interests");
(c) the shares of capital stock or equity or ownership interests
of Anam Telecommunications, Geotek Argentina, S.A. and, to the extent grantable,
GMSI, Inc. represented by the certificates identified in Annex 2B hereto and all
other shares of capital stock or equity or ownership interests of whatever class
of each of those entities, now or hereafter owned by the Pledgors, in each case,
together with the certificates representing the same (collectively, the
"Investment Interests;" together with the Issuer Interests, the "Pledged
Interests");
(d) all shares, securities, moneys or property representing a
dividend on any of the Pledged Interests, or representing a distribution or
return of capital upon or in respect of the Pledged Interests, or resulting from
a split-up, revision, reclassification or other like change of the Pledged
Interests or otherwise received in exchange therefor, and any subscription
warrants, rights or options issued to the holders of, or otherwise in respect
of, the Pledged Interests;
(e) without affecting the obligations of the Pledgors under any
provision prohibiting such action hereunder or under the Credit Agreement, in
the event of any consolidation or merger in which an Issuer is not the surviving
business entity, all shares of each class of the capital stock or equity or
ownership interests of the successor business entity (unless such successor
business entity is one of the Borrowers) formed by or resulting from such
consolidation or merger (the Pledged Interests, together with all other
certificates, shares, securities, properties or moneys as may from time to time
be pledged hereunder pursuant to clause (a) or (b) above and this clause (e)
being herein collectively called the "Interests Collateral");
(f) all rights of any of the Borrowers under and/or to the
proceeds of (a) that certain SMR Frequency Exchange Agreement dated March 14,
1997 by and between Paging Network of America, Inc. ("PageNet") and Geotek
Communications, Inc. (the "PageNet Agreement") with the exception of the New
York MTA license assigned by PageNet to Geotek US Networks, Inc. and (b) that
certain Purchase Agreement dated April 3, 1998 by and between Geotek
Communications, Inc., Gelico, Inc. and Industrial Wireless Technologies, Inc.;
(g) the balance from time to time in the Collateral Account;
(h) to the extent grantable all assets of the Pledgors not
subject to any existing Lien, including, without limitation:
(i) all Accounts;
Page 85 of 108 Pages
(ii) all Chattel Paper;
(iii) all Contracts, including each Contract and other
agreement of the Subsidiaries relating to the sale or other
disposition of Inventory or Equipment, with the exception of
the May Industrial Wireless Agreement, as defined in the
Credit Agreement;
(iv) all Documents;
(v) all Equipment;
(vi) all Instruments;
(vii) all Inventory; and
(viii) all proceeds, products, offspring, accessions, rents,
profits, income, benefits, substitutions and replacements of
and to any of the property of the Pledgors described in the
preceding clauses of this Section 2 (including, without
limitation, any proceeds of insurance thereon and all causes
of action, claims and warranties now or hereafter held by
the Pledgors in respect of any of the items listed above)
and, to the extent related to any property described in said
clauses or such proceeds, products and accessions, all
books, correspondence, credit files, records, invoices and
other papers, including without limitation all tapes, cards,
computer runs and other papers and documents in the
possession or under the control of the Pledgors or any
computer bureau or service company from time to time acting
for the Pledgors;
but excluding any right, title and interest of the Pledgors
in, to or under any Collateral (the "Excluded Property"), to
the extent the security interest created hereby or an
assignment as security of all or part of the Pledgors'
right, title or interest in, to or under such Excluded
Property would breach, violate or cause a default (which
would not be excused or permissible under the relevant
provisions of the Bankruptcy Code or by entry of the Final
Order or Interim Order, as the case may be) under any
agreement or Contract, to which any of the Pledgors is a
party or by which it is bound relating to such Excluded
Property (it being understood, however, that the proceeds of
Excluded Property shall not be excluded from the Collateral
except to the extent such a breach, violation or default
would arise from the inclusion of such proceeds in the
Collateral (which would not be excused or permissible under
the relevant provision of the Bankruptcy Code)). Without
limiting the Borrowers' obligations under the Credit
Agreement with respect to such matters, the foregoing grant
of a security interest in and of itself shall not be deemed
(i) to constitute, require or prevent the assumption of any
obligation in the Chapter 11 Cases or (ii) to prohibit the
rejection of any obligation in the Chapter 11 Cases.
Anything herein contained to the contrary notwithstanding,
Page 86 of 108 Pages
the Pledgors shall remain liable under any agreements or
Contracts, referred to in this Section 2 and to perform all
of their respective obligations thereunder, all in
accordance with the respective terms and provisions thereof,
but subject to the relevant provisions of the Bankruptcy
Code, and the Lender shall have no obligation or liability
under any of the aforementioned agreements or Contracts by
reason of or arising out of the foregoing grant, nor shall
Lender be required or obligated in any manner to perform or
fulfill any obligation of the Pledgors pursuant thereto, or
to make any payment, or to present or file any claim, or to
take any action to collect or enforce the payment of any
amounts which may have been assigned to Lender or to which
it may be entitled at any time. However, the Lender shall,
at its option, have the right, but not the obligation, to
cure any defaults under any such agreements or Contracts
being assumed and/or assumed and assigned to the Lender or
its designee in connection with the exercise of its remedies
hereunder and under Section 10.3 of the Credit Agreement.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
Section 3.1 Representations and Warranties. Each of the Pledgors
represents and warrants to the Lender as of the date hereof as follows:
(a) It is (or will be at the time the Lien created hereby
attaches) and will continue to be until all of the Obligations have been
satisfied in full the sole legal, beneficial and record owner of the Collateral
in which it purports to grant a security interest pursuant to Section 2 hereof
and no Lien exists or will exist upon such Collateral at any time (and no right
or option to acquire the same exists in favor of any other Person), except for
the Liens and security interests in favor of the Lender created or provided for
herein, and in the Credit Agreement and the Liens permitted under Section 9.2 of
the Credit Agreement, which Liens and security interests constitute first
priority perfected Liens and security interests in and to all of such
Collateral. There is no financing statement naming any of the Pledgors as debtor
(or similar documents or instrument of registration under the law of any
jurisdiction) now on file or registered in any public office covering any
interest of the Pledgors in any Collateral.
(b) This Agreement creates a valid first priority security
interest in favor of the Lender in the Collateral, as security for the
Obligations. Upon entry of the Interim Order or Final Order, as the case may be,
such security interest is, or in the case of Collateral in which any of the
Pledgors obtains rights after the date hereof, will be, a perfected first
priority security interest. Upon entry of the Interim Order or Final Order, as
the case may be, all action necessary or desirable to perfect and protect such
security interest has been duly taken.
(c) The Pledged Interests represented by the certificates
identified in Annex 2A and B hereto are, and all other Interests Collateral in
Page 87 of 108 Pages
which the Pledgors 8 shall hereafter grant a security interest pursuant to
Section 2 hereof will be, duly authorized, validly issued, fully paid and
non-assessable and none of such Pledged Interests is or will be subject to any
restriction under the charter or by-laws of the Issuer and none of the Pledged
Interests represented by the certificates identified in Annex 2A hereto is or
will be subject to any contractual restriction, including any restrictions upon
the transfer of such Pledged Interests.
(d) Annex 2A and B hereto correctly identify, as at the date
hereof, the Issuers of such Pledged Interests, and, in respect of the Domestic
Issuers, the respective class and par value of the shares or interests
comprising such Pledged Interests, the respective number of shares or interests
(and registered owners thereof) represented by each such certificate and the
percentage represented thereby of the total issued and outstanding shares or
interests of capital stock or interests of such class of stock or interests of
such Issuers, and, in respect of the Foreign Issuers, the respective class of
the shares or interests comprising such Pledged Interests and the percentage
represented thereby of the total issued and outstanding shares or interests of
capital stock or interests of such class of stock or interests of such Issuers.
(e) The chief executive office of the Borrowers is located at ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇.
(f) Each of the Domestic Issuers Identified on Annex 2A hereto
has no Debt other than indebtedness incurred in acquiring the SMR Licenses
identified in Annex 1 hereto (with the exception of such Domestic Issuers'
guaranty of the Senior Secured Notes dated June 30, 1995).
ARTICLE 4
CASH PROCEEDS OF COLLATERAL
Section 4.1 Collateral Account. At Lender's option, there may be
established a cash collateral account (the "Collateral Account") in the name and
under the control of the Lender into which there may be deposited from time to
time the cash proceeds of any of the Collateral (including proceeds of insurance
thereon) and any additional amounts deposited by the Pledgors from time to time
as collateral security for the Obligations. The balance from time to time in the
Collateral Account shall constitute part of the Collateral hereunder and shall
not constitute payment of the Obligations until applied in accordance with the
terms of the Credit Agreement.
Section 4.2 Proceeds of Collateral. Each of the Pledgors agrees that,
at any time after the occurrence and during the continuance of an Event of
Default, if the proceeds of any Collateral hereunder shall be received by it,
the Pledgors shall, upon the request of the Lender, as promptly as possible
deposit such proceeds into the Collateral Account. Until so deposited, all such
proceeds shall be held in trust by the
Page 88 of 108 Pages
Pledgors for and as the property of the Lender and shall not be commingled with
any other funds or property of the Pledgors.
ARTICLE 5
FURTHER ASSURANCES; REMEDIES
Section 5.1 Further Assurances; Remedies. In furtherance of the grant
of the security and pledge interest pursuant to Section 2 hereof, the Pledgors
hereby agree with the Lender as follows:
(a) Delivery and Other Perfection. The Pledgors shall:
(1) if any of the shares, securities, interests, moneys or
property required to be pledged by the Pledgors under Section 2.1 hereof are
received by the Pledgors, forthwith either (i) transfer and deliver to the
Lender such shares or securities or interests so received by the Pledgors
(together with the certificates for any such shares and securities or interests
duly endorsed in blank or accompanied by undated stock powers duly executed in
blank), all of which thereafter shall be held by the Lender, pursuant to the
terms of this Agreement, as part of the Collateral or (ii) take such other
action as the Lender shall deem necessary or reasonably appropriate to duly
record the Lien created hereunder in such shares, securities, interests, moneys
or property in Section 2.1 herein;
(2) deliver and pledge to the Lender any and all
Instruments, endorsed and/or accompanied by such instruments of assignment and
transfer in such form and substance as the Lender may request provided that so
long as no Default shall have occurred and be continuing, the Pledgors may
retain for collection in the ordinary course any Instruments received by the
Pledgors in the ordinary course of business and the Lender shall, promptly upon
request of any of the Pledgors make appropriate arrangements for making any
other Instrument pledged by the Pledgors available to the Pledgors for purposes
of presentation, collection or renewal (any such arrangement to be effected, to
the extent deemed appropriate by the Lender, against trust receipt or like
document);
(3) give, execute, deliver, file and/or record any financing
statement, notice, instrument, document, agreement or other papers that may be
necessary or desirable (in the reasonable judgment of the Lender) to create,
preserve, perfect or validate the security interest granted pursuant hereto or
to enable the Lender to exercise and enforce its rights hereunder with respect
to such security and pledge interest, including, without limitation, causing any
or all of the Interests Collateral to be transferred into the name of the Lender
or its nominee;
Page 89 of 108 Pages
(4) keep full and accurate books and records relating to the
Collateral, and stamp or otherwise ▇▇▇▇ such books and records in such manner as
the Lender may reasonably require in order to reflect the security interests
granted by this Agreement; and
(5) permit representatives of the Lender, upon reasonable
notice, at any time during normal business hours to inspect and make abstracts
from its books and records pertaining to the Collateral, and permit
representatives of the Lender to be present at the Pledgors' place(s) of
business to receive copies of all communications and remittances relating to the
Collateral, and forward copies of any notices or communications received by the
Pledgors with respect to the Collateral, all in such manner as the Lender may
reasonably require without undue disruption to Pledgors' business.
(b) Preservation of Rights. The Lender shall not be required to
take steps necessary to preserve any rights against prior parties to any of the
Collateral.
(c) Special Provisions Relating to Certain Collateral.
(1) Interests Collateral.
(A) The Pledgors will cause the Interests Collateral to
include all of the capital stock or ownership interests of the Pledgors in each
Issuer.
(B) So long as no Event of Default shall have occurred
and be continuing, the Pledgors shall have the right to exercise all voting,
consensual and other powers of ownership pertaining to the Interests Collateral
for all purposes not inconsistent with the terms of this Agreement and the other
Facility Documents, provided that the Pledgors agree that it will not vote the
Interests Collateral in any manner that is inconsistent with the terms of this
Agreement or any other Facility Document, and the Lender shall execute and
deliver to the Pledgors or cause to be executed and delivered to the Pledgors
all such proxies, powers of attorney, dividend and other orders, and all such
instruments, without recourse, as the Pledgors may reasonably request for the
purpose of enabling the Pledgors to exercise the rights and powers which they
are entitled to exercise pursuant to this Section 5.1(c).
(C) The Issuers shall not and Borrowers shall not
permit any Domestic Issuer to incur, create or assume any Debt or incur any
liabilities without the express consent of the Lender.
Page 90 of 108 Pages
(2) Equipment. The Pledgors shall, upon the request of the
Lender, deliver to the Lender originals of the certificates of title or
ownership for all Equipment covered by a certificate of title owned by the
Pledgors with the Lender listed as lienholder, and take such other action as the
Lender shall deem appropriate to perfect the security interest created hereunder
in all such Equipment.
(d) Events of Default, Etc. During any period during which an
Event of Default shall have occurred and be continuing, but subject to the
provisions of Section 5.1(e) hereof and Section 10.3 of the Credit Agreement:
(1) each Pledgor shall, at the request of the Lender,
assemble the Collateral owned by it at such place or places, reasonably
convenient to both the Lender and the Pledgors, designated in the Lender's
request;
(2) the Lender may make any reasonable compromise or
settlement deemed desirable with respect to any of the Collateral and may extend
the time of payment, arrange for payment in installments, or otherwise modify
the terms of, any of the Collateral;
(3) the Lender shall have all of the rights and remedies
with respect to the Collateral of a secured party under the Uniform Commercial
Code (whether or not said Code is in effect in the jurisdiction where the rights
and remedies are asserted) and such additional rights and remedies to which a
secured party is entitled under the laws in effect in any jurisdiction where any
rights and remedies hereunder may be asserted, including, without limitation,
the right, to the maximum extent permitted by law, to exercise all voting,
consensual and other powers of ownership pertaining to the Collateral as if the
Lender were the sole and absolute owner thereof (and the Pledgors agree to take
all such action as may be appropriate to give effect to such right);
(4) the Lender in its discretion may, in its name or in the
name of the Borrowers or otherwise, demand, ▇▇▇ for, collect or receive any
money or property at any time payable or receivable on account of or in exchange
for any of the Collateral, but shall be under no obligation to do so;
(5) foreclose on this Agreement and the security interests
created thereby, and sell, lease, assign or otherwise dispose of all or any part
of the Collateral or any part thereof which shall then be or shall thereafter
come into the possession, custody or control of the Lender or any of its agents
in a public or private sale; and/or
(6) with respect to all unexpired leases and executory
Page 91 of 108 Pages
contracts (within the meaning of the Bankruptcy Code), the Lender shall, without
application to or order of the Bankruptcy Court, have the exclusive right, upon
the occurrence and during the continuance of an Event of Default, to direct the
disposition, subject to the rights and remedies enforceable by or available to
parties, other than the Pledgors (including rights under section 365 of the
Bankruptcy Code), with respect to such property, of the Pledgors' right, title
and interest in and to any such property, including directing the Pledgors to
seek any consent necessary to dispose of such property or assume and assign such
property to the Lender or its designee. The proceeds from any such disposition
shall be applied in accordance with the terms of the Credit Agreement.
(e) FCC Approval. Any action by the Lender permitted pursuant to
Section 5.1(d) hereof that may reasonably result in the transfer to the Lender
or any other entity of direct or indirect ownership or control of any entity
holding any SMR Licenses shall be subject to, and shall not be undertaken
without, the prior approval of the FCC. In the event that the Lender determines,
by notice to the Pledgor holding such SMR Licenses, to take any such action,
such Pledgor shall, in consultation with the Lender, use such Pledgor's best
efforts to obtain timely FCC approval for such transfer of ownership or control,
including, but not limited to, preparing, executing and filing all necessary FCC
applications, defending such applications against any petitions to deny or other
adverse pleadings filed with the FCC, and promptly providing any documents or
other information requested by the FCC in connection with such applications. The
Lender shall have the right to prepare and file, on behalf of any such Pledgor,
all applications and documents necessary to obtain FCC approval of such
transfer, and in the event that the Lender chooses to exercise this right, the
Pledgor holding the relevant SMR Licenses shall timely provide the Lender with
all information and assistance requested by the Lender that is, in the sole
discretion of the Lender, necessary for the Lender to make such filings, and
shall reimburse the Lender for all legal and administrative costs incurred in
the filing of such applications and in the diligent prosecution of such
applications at the FCC.
Section 5.2 Deficiency. If the proceeds of sale, collection or other
realization of or upon the Collateral pursuant to Section 5.1(d) hereof are
insufficient to cover the costs and expenses of such realization and the payment
in full of the Obligations, the Pledgors shall remain liable for any deficiency.
Section 5.3 Removals, Etc. Without at least 30 days' prior written
notice to the Lender, the Pledgors shall not maintain any of their books and
records with respect to the Collateral at any office or maintain its principal
place of business at any place, to be located anywhere, other than at one of the
locations identified in Annex 3 hereto under its name or in transit from one of
such locations to another or (ii) change its name, or the name under which it
does business, from the name shown on the signature pages hereto.
Page 92 of 108 Pages
Section 5.4 Application of Proceeds. Except as otherwise herein
expressly provided, the proceeds of any collection, sale or other realization of
all or any part of the Collateral of the Pledgors under Section 5.1(d) hereof,
and any other cash of the Pledgors at the time held by the Lender under and in
accordance with Section 4 hereof or this Section 5, shall be applied by the
Lender to reduce the Obligation then outstanding in accordance with the terms of
the Credit Agreement.
As used in this Section 5, "proceeds" of Collateral shall mean cash,
securities and other property realized in respect of, and distributions in kind
of, Collateral, including any thereof received under any reorganization,
liquidation or adjustment of debt of the Borrowers or any Issuer of any of the
Collateral.
Section 5.5 Attorney-in-Fact. Without limiting any rights or powers
granted by this Agreement to the Lender while no Event of Default has occurred
and is continuing, upon the occurrence and during the continuance of any Event
of Default, the Lender is hereby appointed the attorney-in-fact of the Pledgors
for the purpose of carrying out the provisions of this Section 5 and taking any
action and executing any instruments which the Lender may deem necessary or
reasonably advisable to accomplish the purposes hereof, which appointment as
attorney-in-fact is irrevocable and coupled with an interest.
Section 5.6 Perfection. Prior to or concurrently with the execution
and delivery of this Agreement, the Pledgors shall (a) file such financing
statements and other documents in such offices as the Lender may request to
perfect the security interests granted by Section 2.1 hereof and (b) deliver to
the Lender all certificates identified in Annex 2A and B hereto, accompanied by
undated stock powers duly executed in blank.
Section 5.7 Termination. When all the Obligations shall have been paid
in full and the Commitments of the Lender under the Credit Agreement shall have
expired or been terminated, this Agreement shall terminate, and the Lender shall
forthwith cause to be assigned, transferred and delivered, against receipt but
without any recourse, warranty or representation whatsoever, any remaining
Collateral and money received in respect thereof, to or on the order of the
Pledgors and to be released and canceled all licenses and rights referred to in
Section 5.6(b) hereof. The Lender shall also execute and deliver to the Pledgors
upon such termination such Uniform Commercial Code termination statements and
such other documentation as shall be reasonably requested by the Pledgors to
effect the termination and release of the Lien of this Agreement on the
Collateral.
Section 5.8 Expenses and Indemnities.
(a) The Pledgors agree to reimburse the Lender for all reasonable
out-of-pocket expenses of the Lender (including, without limitation, the
reasonable fees and expenses of outside and internal legal counsel) of, or
Page 93 of 108 Pages
incident to (i) any Event of Default and (ii) any enforcement or collection
proceeding resulting therefrom, including, without limitation, (A) performance
by the Lender of any obligations of the Pledgors in respect of the Collateral
that the Pledgors have failed or refused to perform, (B) any actual or attempted
sale, or any exchange, enforcement, collection, compromise or settlement in
respect of any of the Collateral, and for the care of the Collateral and
defending or asserting rights and claims of the Lender in respect thereof, by
litigation or otherwise, including expenses of insurance, (C) judicial or
regulatory proceedings and (D) the enforcement of this Section 5, and all such
expenses shall be Obligations to the Lender secured under Section 2 hereof.
(b) The Pledgors agree to indemnify the Lender from and against
any and all claims, losses and liabilities (including, without limitation, the
reasonable fees, client charges and other expenses of the Lender's outside and
internal counsel) growing out of or resulting from this Agreement or the
enforcement of any of the terms hereof (including, without limitation, the sale
of Collateral pursuant to a public or private offering and each and every
document produced in furtherance thereof), except claims, losses or liabilities
resulting solely and directly from the Lender's gross negligence or willful
misconduct.
Section 5.9 Further Assurances. The Pledgors agree that, from time to
time upon the written request of the Lender, the Pledgors will execute and
deliver such further documents and do such other acts and things as the Lender
may reasonably request in order fully to effect the purposes of this Agreement.
Section 5.10 Releases. Without limiting the obligations of the
Pledgors hereunder and under the Credit Agreement, upon the sale, assignment,
transfer or other disposition of any property effected in accordance with the
Credit Agreement, the Lender shall, at the Borrowers' expense, execute and
deliver to the Pledgors such Uniform Commercial Code termination statements and
such other documentation as shall be reasonably requested by the Pledgors to
effect the termination and release of the Lien of this Agreement on such
property.
Section 5.11 Other Financing Statements and Liens. Except as otherwise
permitted under Section 9.2 of the Credit Agreement and except for precautionary
financing statements filed with respect to operating leases (as defined in
accordance with GAAP) entered into by the Pledgors, the Pledgors shall not file
or suffer to be on file, or authorize or permit to be filed or to be on file, in
any jurisdiction, any financing statement or like instrument with respect to the
Collateral in which the Lender is not named as the sole secured party.
Page 94 of 108 Pages
ARTICLE 6
MISCELLANEOUS
Section 6.1 No Waiver. No failure on the part of the Lender or any
agent of the Lender to exercise, and no course of dealing with respect to, and
no delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise by the Lender or any
agent of the Lender of any right, power or remedy hereunder preclude any other
or further exercise thereof or the exercise of any other right, power or remedy.
The remedies herein are cumulative and are not exclusive of any remedies
provided by law.
Section 6.2 Notices. All notices, requests, consents and demands
hereunder shall be made in the manner and at the addresses set forth in Section
11.6 of the Credit Agreement.
Section 6.3 Amendments, Etc. The terms of this Agreement may be
waived, altered or amended only by an instrument in writing duly executed by the
Pledgors and the Lender. Any such amendment or waiver shall be binding upon the
Lender and the Pledgors.
Section 6.4 Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the respective successors and assigns of the
Pledgors and the Lender (provided that the Pledgors shall not assign or transfer
its rights hereunder without the prior written consent of the Lender).
Section 6.5 Captions. The captions and section headings appearing
herein are included solely for convenience of reference and are not intended to
affect the interpretation of any provision of this Agreement.
Section 6.6 Counterparts. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
Section 6.7 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the internal law of the State of New York, without
regard to choice of law principles thereof.
Section 6.8 Severability. If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in favor of the Lender order to
carry out the intentions of the parties hereto as nearly as may be possible and
Page 95 of 108 Pages
(ii) the invalidity or unenforceability of any provision hereof in any
jurisdiction shall not affect the validity or enforceability of such provision
in any other jurisdiction.
IN WITNESS WHEREOF, the parties hereto have caused this Security and
Pledge Agreement to be duly executed and delivered as of the day and year first
above written.
GEOTEK COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK USA, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
ANSA COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
CLW COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
CUMULOUS HOLDING CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 96 of 108 Pages
GELICO, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GELICO OF CHICAGO, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GENERAL PHOTONICS HOLDING
CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOPOWER, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK ACQUISITION CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK AMERICA, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 97 of 108 Pages
GEOTEK ASIA, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK DATA, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK FINANCING
CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK GMBH HOLDING
CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK INTERNATIONAL
NETWORKS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK HOLDINGS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 98 of 108 Pages
GEOTEK OF ATLANTA, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK OF BOSTON, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK OF CHICAGO, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK OF DALLAS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK OF HOUSTON, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK OF MIAMI, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 99 of 108 Pages
GEOTEK OF NEW YORK, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK OF ORLANDO, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK OF PHILADELPHIA,INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK OF TAMPA, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK OF WASHINGTON, D.C.,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK SERVICES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 100 of 108 Pages
GEOTEK SUBSIDIARY
INDUSTRIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
GEOTEK TECHNOLOGIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
LASER ACQUISITION
CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
METRO NET SYSTEMS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
M.I.S. HOLDINGS ACQUISITION
CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
MOBILE MESSAGE SERVICE OF
TEXAS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title:CFO
Page 101 of 108 Pages
OAKHILL COMMUNICATIONS,INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
▇▇▇▇ USA, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
PATLEX INTERNATIONAL
CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
PATLEX OF DELAWARE, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM MICROWAVE,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF ATLANTA,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 102 of 108 Pages
POWERSPECTRUM OF BOSTON,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF BUFFALO,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF CHARLOTTE,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF CHICAGO,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF
CINCINNATI, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------
Title: CFO
POWERSPECTRUM OF D.C., INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 103 of 108 Pages
POWERSPECTRUM OF DALLAS,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF DENVER,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF
GREENSBORO, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF HARTFORD,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF
INDIANAPOLIS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 104 of 108 Pages
POWERSPECTRUM OF
JACKSONVILLE, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF KANSAS
CITY, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF MEMPHIS,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF MIAMI,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF
MINNEAPOLIS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF NASHVILLE,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 105 of 108 Pages
POWERSPECTRUM OF NEW YORK
CITY, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF ORLANDO,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF
PHILADELPHIA, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF PHOENIX,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF ROCHESTER,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 106 of 108 Pages
POWERSPECTRUM OF SALT LAKE
CITY, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF
SAN FRANCISCO, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF SEATTLE,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
POWERSPECTRUM OF TAMPA,
INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
RESHEF USA, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
U.S.I. VENTURE CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
Page 107 of 108 Pages
POWERSPECTRUM OF
NEW ORLEANS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title: CFO
[This page intentionally left blank]
Page 108 of 108 Pages
S-C RIG INVESTMENTS III,
L.P., by S-C Rig Co.,
its general partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------
Title: Vice President