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Exhibit 4.5
EXECUTION VERSION
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U.S. GUARANTEE AND COLLATERAL AGREEMENT
made by
RSC HOLDINGS II, LLC,
RSC HOLDINGS III, LLC,
RENTAL SERVICE CORPORATION,
and
CERTAIN DOMESTIC SUBSIDIARIES OF RSC HOLDINGS III, LLC,
in favor of
DEUTSCHE BANK AG, NEW YORK BRANCH,
as U.S. Administrative Agent and U.S. Collateral Agent,
Dated as of November 27, 2006
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Table of Contents
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ARTICLE I Defined
Terms..................................................
2
Section 1.1.
Definitions.............................................
2
Section 1.2.
Other Definitional
Provisions........................... 10
ARTICLE II
Guarantee.....................................................
11
Section 2.1.
Guarantee...............................................
11
Section 2.2.
Right of
Contribution................................... 12
Section 2.3.
No
Subrogation.......................................... 12
Section 2.4.
Amendments, etc. with
respect to the Obligations........ 13
Section 2.5.
Guarantee Absolute and
Unconditional.................... 13
Section 2.6.
Reinstatement...........................................
15
Section 2.7.
Payments................................................
15
ARTICLE III Grant of Security
Interest................................... 15
Section 3.1.
Grant...................................................
15
Section 3.2.
Pledged
Collateral...................................... 17
Section 3.3.
Certain Limited
Exceptions.............................. 17
Section 3.4.
Intercreditor
Relations................................. 18
ARTICLE IV Representations and
Warranties................................ 18
Section 4.1.
Representations and
Warranties of Each Guarantor........ 18
Section 4.2.
Representations and
Warranties of Each Grantor.......... 19
Section 4.3.
Representations and
Warranties of Each Pledgor.......... 22
ARTICLE V
Covenants......................................................
23
Section 5.1.
Covenants of Each
Guarantor............................. 23
Section 5.2.
Covenants of Each
Grantor............................... 23
Section 5.3.
Covenants of Each
Pledgor............................... 27
ARTICLE VI Remedial
Provisions........................................... 28
Section 6.1.
Certain Matters
Relating to Accounts.................... 29
Section 6.2.
Communications with
Obligors; Grantors Remain Liable.... 30
Section 6.3.
Pledged
Stock........................................... 30
Section 6.4.
Proceeds to be Turned
Over To U.S. Collateral Agent..... 31
Section 6.5.
Application of
Proceeds................................. 32
Section 6.6.
Code and Other
Remedies................................. 35
Section 6.7.
Registration
Rights..................................... 36
Section 6.8.
Waiver;
Deficiency...................................... 37
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ARTICLE VII The Collateral
Agent......................................... 37
Section 7.1.
U.S. Collateral
Agent's Appointment as
Attorney-in-Fact, etc...................................
37
Section 7.2.
Duty of U.S.
Collateral Agent........................... 39
Section 7.3.
Financing
Statements.................................... 39
Section 7.4.
Authority of U.S.
Collateral Agent...................... 40
Section 7.5.
Right of
Inspection..................................... 40
ARTICLE VIII Non-Lender Secured
Parties.................................. 40
Section 8.1.
Rights to
Collateral.................................... 40
Section 8.2.
Appointment of
Agent.................................... 42
Section 8.3.
Waiver of
Claims........................................ 42
ARTICLE IX
Miscellaneous.................................................
42
Section 9.1.
Amendments in
Writing................................... 42
Section 9.2.
Notices.................................................
43
Section 9.3.
No Waiver by Course of
Conduct; Cumulative Remedies..... 43
Section 9.4.
Enforcement Expenses;
Indemnification................... 43
Section 9.5.
Successors and
Assigns.................................. 44
Section 9.6.
Set-Off.................................................
44
Section 9.7.
Counterparts............................................
44
Section 9.8.
Severability............................................
44
Section 9.9.
Section
Headings........................................ 45
Section 9.10.
Integration.............................................
45
Section 9.11.
GOVERNING LAW...........................................
45
Section 9.12.
Submission To Jurisdiction; Waivers.....................
45
Section 9.13.
Acknowledgments.........................................
45
Section 9.14.
WAIVER OF JURY TRIAL....................................
46
Section 9.15.
Additional Granting Parties.............................
46
Section 9.16.
Releases................................................
46
Section 9.17.
Judgment................................................
47
SCHEDULES
Schedule 1 --
Notice Addresses of Guarantors
Schedule 2 --
Pledged Securities
Schedule 3 --
Perfection Matters
Schedule 4 --
Location of Jurisdiction of Organization
Schedule 5 --
Intellectual Property
Schedule 6 --
Contracts
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Schedule 7 --
Commercial Tort Claims
ANNEXES
Annex 1 --
Acknowledgement and Consent of Issuers who are not
Granting Parties
Annex 2 --
Assumption Agreement
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U.S. GUARANTEE AND COLLATERAL AGREEMENT
U.S. GUARANTEE AND COLLATERAL AGREEMENT, dated as of November
27,
2006, made by RSC HOLDINGS II, LLC, a Delaware limited liability
company
("Holdings"), RSC HOLDINGS III, LLC, a Delaware limited liability
company (in
its specific capacity as Parent Borrower, together with its
successors and
assigns, the "Parent Borrower"), RENTAL SERVICE CORPORATION, an
Arizona
corporation ("RSC") and certain of the Parent Borrower's
Subsidiaries that may
become party hereto from time to time pursuant to Section 9.15 in
favor of
DEUTSCHE BANK AG, NEW YORK BRANCH ("DBNY"), as collateral agent (in
such
capacity, the "U.S. Collateral Agent") and administrative agent (in
such
capacity, the "U.S. Administrative Agent") for the banks and other
financial
institutions (collectively, the "Lenders"; individually, a
"Lender") from time
to time parties to the Credit Agreement described below and for the
other
Secured Parties (as defined below).
WITNESSETH:
WHEREAS, pursuant to that certain Credit Agreement, dated as of
the
date hereof (as amended, amended and restated, waived, supplemented
or otherwise
modified from time to time, together with any agreement extending
the maturity
of, or restructuring, refunding, refinancing or increasing the
Indebtedness
under such agreement or successor agreements, the "Credit
Agreement"), among
Holdings, the Parent Borrower and RSC (together with the Parent
Borrower and any
other entity that becomes a borrower thereunder pursuant to
subsection 7.9(b) of
the Credit Agreement, the "U.S. Borrowers"), Rental Service
Corporation of
Canada Ltd. (together with any other entity that becomes a borrower
pursuant to
subsection 7.9(c) of the Credit Agreement, the "Canadian
Borrowers"), the U.S.
Collateral Agent, the U.S. Administrative Agent, Deutsche Bank AG,
Canada
Branch, as Canadian administrative agent and Canadian collateral
agent (in such
capacities, the "Canadian Administrative Agent" and "Canadian
Collateral
Agent"), and the other parties party thereto, the Lenders have
severally agreed
to make extensions of credit to the Borrowers upon the terms and
subject to the
conditions set forth therein (the Lenders, each Issuing Lender,
the
Administrative Agents, the Collateral Agents and each other Agent
are herein
called the "Lender Creditors");
WHEREAS, the Borrowers are members of an affiliated group of
companies
that includes Holdings, the Borrowers, and any other Domestic
Subsidiary of the
Parent Borrower that becomes a party hereto from time to time after
the date
hereof (all of the foregoing (other than the Canadian Borrowers and
Canadian
Finco) collectively, the "Granting Parties");
WHEREAS, the proceeds of the extensions of credit under the
Credit
Agreement will be used in part to enable the Borrowers to make
valuable
transfers to one or more of the other Granting Parties in
connection with the
operation of their respective businesses;
WHEREAS, the Borrowers and the other Granting Parties are engaged
in
related businesses, and each such Granting Party will derive
substantial direct
and indirect benefit from the making of the extensions of credit
under the
Credit Agreement;
WHEREAS, it is a condition to the obligation of the Lenders to
make
their respective extensions of credit under the Credit Agreement
that the
Granting Parties shall
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execute and deliver this Agreement to the U.S. Collateral Agent for
the benefit
of the Secured Parties (as defined below);
WHEREAS, each Borrower and/or one or more of their respective
Subsidiaries may at any time and from time to time enter into one
or more
Interest Rate Protection Agreements or Permitted Hedging
Arrangements with one
or more Lenders or any affiliate thereof (each such Lender or
affiliate, even if
the respective Lender subsequently ceases to be a Lender under the
Credit
Agreement for any reason, together with such Lender's or
affiliate's successors
and assigns, if any, collectively, the "Other Creditors" and,
together with the
Lender Creditors, the "Secured Parties");
WHEREAS, the U.S. Collateral Agent and the Collateral Agent under,
and
as defined in, the Second Lien Term Loan Credit Agreement have
entered into an
Intercreditor Agreement with Holdings and certain of the Borrowers
and the other
Granting Parties, dated as of the date hereof (as amended, amended
and restated,
waived, supplemented or otherwise modified from time to time, the
"Intercreditor
Agreement").
NOW, THEREFORE, in consideration of the premises and to induce
the
U.S. Administrative Agent and the Lenders to enter into the Credit
Agreement and
to induce the Lenders to make their respective extensions of credit
to the
Borrowers thereunder, each Granting Party hereby agrees with the
U.S. Collateral
Agent, for the ratable benefit of the Secured Parties, as
follows:
ARTICLE I
Defined Terms
Section 1.1. Definitions. (a) Unless otherwise defined herein,
terms
defined in the Credit Agreement and used herein shall have the
meanings given to
them in the Credit Agreement, and the following terms that are
defined in the
Code (as in effect on the date hereof) are used herein as so
defined: Chattel
Paper, Commercial Tort Claims, Documents, Electronic Chattel Paper,
Deposit
Accounts, Documents, Equipment, Farm Products, Fixtures, General
Intangibles,
Letter-of-Credit Rights, Money, Promissory Notes, Records,
Securities,
Securities Accounts, Security Entitlements, Supporting Obligations
and Tangible
Chattel Paper.
(b) The following terms shall have the following meanings:
"Accounts": all accounts (as defined in the Code) of each
Grantor,
including, without limitation, all Accounts (as defined in the
Credit Agreement)
and Accounts Receivable of such Grantor.
"Accounts Receivable": any right to payment for goods sold or
leased
or for services rendered, which is not evidenced by an instrument
(as defined in
the Code) or Chattel Paper.
"Adjusted Net Worth": of any Guarantor at any time, shall mean
the
greater of (x) $0 and (y) the amount by which the fair saleable
value of such
Guarantor's assets on the date of the respective payment hereunder
exceeds its
debts and other liabilities (including contingent
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liabilities, but without giving effect to any of its obligations
under this
Agreement or any other Loan Document, or pursuant to its guarantee
with respect
to any Indebtedness then outstanding pursuant to clauses (b) and
(d) of
subsection 8.2 of the Credit Agreement) on such date.
"Agreement": this U.S. Guarantee and Collateral Agreement, as the
same
may be amended, restated, supplemented, waived or otherwise
modified from time
to time.
"Asset Sales Proceeds Account": one or more Deposit Accounts or
Securities Accounts holding only the proceeds of any sale or
disposition of any
Collateral and the proceeds or investment thereof.
"Bankruptcy Case": (i) Holdings or any of its Subsidiaries
commencing
any case, proceeding or other action (A) under any existing or
future law of any
jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency,
reorganization, conservatorship or relief of debtors, seeking to
have an order
for relief entered with respect to it, or seeking to adjudicate it
a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment,
winding-up,
liquidation, dissolution, composition or other relief with respect
to it or its
debts, or (B) seeking appointment of a receiver, trustee,
custodian, conservator
or other similar official for it or for all or any substantial part
of its
assets, or Holdings or any of its Subsidiaries making a general
assignment for
the benefit of its creditors; or (ii) there being commenced against
Holdings or
any of its Subsidiaries any case, proceeding or other action of a
nature
referred to in clause (i) above which (A) results in the entry of
an order for
relief or any such adjudication or appointment or (B) remains
undismissed,
undischarged or unbonded for a period of 60 days.
"Borrower
Loan Document Obligations": as defined in the definition of
"Borrower Obligations" in this subsection 1.1(b).
"Borrower Obligations": with respect to any Borrower, the
collective
reference to: all obligations and liabilities of such Borrower in
respect of (i)
the unpaid principal of and interest on (including, without
limitation, interest
accruing after the maturity of the Loans and Reimbursement
Obligations and
interest accruing after the filing of any petition in bankruptcy,
or the
commencement of any insolvency, reorganization or like proceeding,
relating to
such Borrower, whether or not a claim for post-filing or
post-petition interest
is allowed in such proceeding) the Loans, the Reimbursement
Obligations, and all
other obligations and liabilities of such Borrower to the Secured
Parties,
whether direct or indirect, absolute or contingent, due or to
become due, or now
existing or hereafter incurred, which may arise under, out of, or
in connection
with, the Credit Agreement, the Loans, the Letters of Credit, the
other Loan
Documents (all such obligations, liabilities and indebtedness under
this clause
(i), except to the extent consisting of obligations and
indebtedness with
respect to Interest Rate Protection Agreement or Permitted Hedging
Arrangements,
being herein collectively called the "Borrower Loan Document
Obligations"), and
(ii) any Interest Rate Protection Agreement or Permitted Hedging
Arrangement
entered into with any Person who was at the time of entry into such
agreement a
Lender or an affiliate of any Lender (all such obligations,
liabilities and
indebtedness under this clause (ii) being herein collectively
called the
"Borrower Other Obligations"); in each case whether on account of
principal,
interest, reimbursement obligations, amounts payable in connection
with the
provision of such cash management services or a termination of any
transaction
entered into pursuant to any such Interest Rate Protection
Agreement or
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Permitted Hedging Arrangement, fees, indemnities, costs, expenses
or otherwise
(including, without limitation, all reasonable fees, expenses and
disbursements
of counsel to the Administrative Agent or any other Secured Party
that are
required to be paid by such Borrower pursuant to the terms of the
Credit
Agreement or any other Loan Document).
"Borrower Other Obligations": as defined in the definition of
"Borrower Obligations" in this subsection 1.1(b).
"Borrowers": the U.S. Borrowers, the Canadian Borrower and, from
and
after the date on which it executes and delivers to the U.S.
Administrative
Agent a Borrower Joinder Agreement, Canadian Finco.
"Canadian Borrower Obligations": all Obligations of the
Canadian
Borrowers and any guarantees thereof (including by U.S. Loan
Parties) pursuant
to the Canadian Guarantee Agreement or pursuant to any other Loan
Document.
"Code": the Uniform Commercial Code as from time to time in effect
in
the State of New York.
"Collateral": as defined in Section 3; provided that, for purposes
of
subsection 6.5, Section 8 and subsection 9.16(b), "Collateral"
shall have the
meaning assigned to such term in the Credit Agreement.
"Commercial Tort Action" any action, other than (i) an action
primarily seeking declaratory or injunctive relief with respect to
claims
asserted or expected to be asserted by Persons other than the
Grantors or (ii)
an action arising out of or related to PL/PD Claims, that is
commenced by a
Grantor in the courts of the United States of America, any state or
territory
thereof or any political subdivision of any such state or
territory, in which
any Grantor seeks damages arising out of torts committed against it
that would
reasonably be expected to result in a damage award to it exceeding
$40,000,000.
"Commitments": the collective reference to (i) the Term Loan
Commitments, (ii) the RCF Commitments and (iii) the obligation of
the Issuing
Lenders to issue Letters of Credit to the Borrowers pursuant to
subsection 3.1
of the Credit Agreement.
"Contracts": with respect to any Grantor, all contracts,
agreements,
instruments and indentures in any form and portions thereof (except
for
contracts listed on Schedule 6 hereto), to which such Grantor is a
party or
under which such Grantor or any property of such Grantor is
subject, as the same
may from time to time be amended, supplemented, waived or otherwise
modified,
including, without limitation, (i) all rights of such Grantor to
receive moneys
due and to become due to it thereunder or in connection therewith,
(ii) all
rights of such Grantor to damages arising thereunder and (iii) all
rights of
such Grantor to perform and to exercise all remedies
thereunder.
"Copyright Licenses": with respect to any Grantor, all written
license
agreements of such Grantor providing for the grant by or to such
Grantor of any
right under any copyright of such Grantor, other than agreements
with any Person
who is an Affiliate or a Subsidiary of the Parent Borrower or such
Grantor,
including, without limitation, any material license agreements
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listed on Schedule 5 hereto, subject, in each case, to the terms of
such license
agreements, and the right to prepare for sale, sell and advertise
for sale, all
Inventory now or hereafter covered by such licenses.
"Copyrights": with respect to any Grantor, all of such
Grantor's
right, title and interest in and to all United States and foreign
copyrights,
whether or not the underlying works of authorship have been
published or
registered, all United States and foreign copyright registrations
and copyright
applications, including, without limitation, any copyright
registrations and
copyright applications listed on Schedule 5 hereto, and (i) all
renewals
thereof, (ii) all income, royalties, damages and payments now and
hereafter due
and/or payable with respect thereto, including, without limitation,
payments
under all licenses entered into in connection therewith, and
damages and
payments for past or future infringements thereof and (iii) the
right to sue or
otherwise recover for past, present and future infringements
and
misappropriations thereof.
"Credit Agreement": has the meaning provided in the Preamble
hereto.
"Excess Foreign Subsidiary Capital Stock" as defined in Section
3.1.
"Excluded Assets": as defined in Section 3.3.
"General Fund Account": the general fund account of the
relevant
Grantor established at the same office of the U.S. Collateral
Account Bank as
the U.S. Collateral Proceeds Account.
"Granting Parties": as defined in the recitals hereto.
"Grantor": Holdings, the U.S. Borrowers, and any other Domestic
Subsidiary of the Parent Borrower that becomes a party hereto from
time to time
after the date hereof.
"Guarantor Obligations": with respect to any Guarantor, the
collective
reference to (i) the Obligations guaranteed by such Guarantor
pursuant to
Section 2 and (ii) (A) all obligations and liabilities of such
Guarantor that
may arise under or in connection with this Agreement or any other
Loan Document
to which such Guarantor is a party (all such obligations,
liabilities and
indebtedness under this clause (ii)(A), except to the extent
consisting of
obligations and indebtedness with respect to Interest Rate
Protection Agreement
or Permitted Hedging Arrangements, being herein collectively called
the
"Guarantor Loan Document Obligations," and, together with the
Borrower Loan
Obligations, the "Loan Document Obligations") and (B) any Interest
Rate
Protection Agreement or Permitted Hedging Arrangement entered into
with any
Person who was at the time of entry into such agreement a Lender or
an affiliate
of any Lender (all such obligations, liabilities and indebtedness
under this
clause (ii)(B) being herein collectively called the "Guarantor
Other
Obligations," and, together with the Borrower Other Obligations,
the "Other
Obligations"); in each case whether on account of guarantee
obligations,
reimbursement obligations, fees, indemnities, costs, expenses or
otherwise
(including, without limitation, all fees and disbursements of
counsel to the
U.S. Administrative Agent, to the Lead Arrangers or to the Lenders
that are
required to be paid by such Guarantor pursuant to the terms of this
Agreement or
any other Loan Document).
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"Guarantors": the collective reference to each Granting Party
other
than Holdings; provided, that, when referring to the U.S. Borrowers
as
Guarantors, such reference shall be a reference solely to a
guaranty of the
Obligations of the Canadian Borrowers and Canadian Finco.
"Instruments": has the meaning specified in Article IX of the
Code,
but excluding the Pledged Securities.
"Intellectual Property": with respect to any Grantor, the
collective
reference to such Grantor's Copyrights, Copyright Licenses,
Patents, Patent
Licenses, Trade Secrets, Trademarks and Trademark Licenses.
"Intercompany Note":
with respect to any Grantor, any promissory note
in a principal amount in excess of $3,500,000 evidencing loans made
by such
Grantor to Holdings or any of its Subsidiaries.
"Intercreditor Agreement": as defined in the recitals hereto.
"Inventory": with respect to any Grantor, all inventory (as defined
in
the Code) of such Grantor, including, without limitation, all
Inventory (as
defined in the Credit Agreement) of such Grantor.
"Investment Property": the collective reference to (i) all
"investment
property" as such term is defined in Section 9-102(a)(49) of the
Uniform
Commercial Code in effect in the State of New York on the date
hereof (other
than any Capital Stock of any Foreign Subsidiary excluded from the
definition of
"Pledged Stock") and (ii) whether or not constituting "investment
property" as
so defined, all Pledged Securities.
"Issuers": the collective reference to the Persons identified
on
Schedule 2 as the issuers of Pledged Stock, together with any
successors to such
companies (including, without limitation, any successors
contemplated by
subsection 8.5 of the Credit Agreement).
"Lender Creditors": as defined in the recitals hereto.
"Loan Document Obligations": as defined in the definition of
"Guarantor Obligations" in this subsection 1.1(b).
"Non-Lender Secured Parties": the collective reference to any
person
who, at the time of entering into any Interest Rate Protection
Agreement or
Permitted Hedging Arrangement secured hereby, was a Lender or an
affiliate of
any Lender and their respective successors and assigns.
"Obligations": (i) in the case of each Borrower, its Borrower
Obligations and its Guarantor Obligations and (ii) in the case of
each other
Guarantor, its Guarantor Obligations.
"Other Creditors: as defined in the recitals hereto.
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"Other Obligations": as defined in the definition of "Guarantor
Obligations" in this subsection 1.1(b).
"Parent Borrower": as defined in the Preamble hereto.
"Patent Licenses": with respect to any Grantor, all written
license
agreements of such Grantor providing for the grant by or to such
Grantor of any
right under any patent, patent application, or patentable invention
other than
agreements with any Person who is an Affiliate or a Subsidiary of
the Parent
Borrower or such Grantor, including, without limitation, the
material license
agreements listed on Schedule 5 hereto, subject, in each case, to
the terms of
such license agreements, and the right to prepare for sale, sell
and advertise
for sale, all Inventory now or hereafter covered by such
licenses.
"Patents": with respect to any Grantor, all of such Grantor's
right,
title and interest in and to all United States and foreign patents,
patent
applications and patentable inventions and all reissues and
extensions thereof,
including, without limitation, all patents and patent applications
identified in
Schedule 5 hereto, and including, without limitation, (i) all
inventions and
improvements described and claimed therein, (ii) the right to sue
or otherwise
recover for any and all past, present and future infringements
and
misappropriations thereof, (iii) all income, royalties, damages and
other
payments now and hereafter due and/or payable with respect thereto
(including,
without limitation, payments under all licenses entered into in
connection
therewith, and damages and payments for past, present or future
infringements
thereof), and (iv) all other rights corresponding thereto and all
reissues,
divisions, continuations, continuations-in-part, substitutes,
renewals, and
extensions thereof, all improvements thereon, and all other rights
of any kind
whatsoever of such Grantor accruing thereunder or pertaining
thereto.
"Permitted Hedging Arrangement": as defined in subsection 8.17 of
the
Credit Agreement.
"PL/PD Claims" means all claims that (i) arise out of or are
related
to damage to the property of the Parent Borrower or any of its
Subsidiaries or
out of bodily injury (including death) or damage to the property of
Persons
other than the Parent Borrower and its Subsidiaries and are
classified as
"public liability and property damage" claims for purposes of the
consolidated
financial statements of the Parent Borrower and its Subsidiaries
and (ii) arise
out of or are related to any policy of insurance under which the
Parent Borrower
or any of its Subsidiaries is an insured or otherwise a
beneficiary.
"Pledged Collateral": as to any Pledgor, the Pledged Securities
now
owned or at any time hereafter acquired by such Pledgor, and any
Proceeds
thereof.
"Pledged Notes": with respect to any Pledgor, all promissory
notes
issued to or held by any Grantor in a principal amount in excess of
$3,500,000
(other than promissory notes issued in connection with an extension
of trade
credit by any Grantor in the ordinary course of business) and all
Intercompany
Notes at any time issued to, or held or owned by, such Pledgor.
"Pledged Securities": the collective reference to the Pledged
Notes
and the Pledged Stock.
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"Pledged Stock": with respect to any Pledgor, the shares of
Capital
Stock listed on Schedule 2 as held by such Pledgor, together with
any other
shares of Capital Stock required to be pledged by such Pledgor
pursuant to
subsection 7.9 of the Credit Agreement, as well as any other
shares, stock
certificates, options or rights of any nature whatsoever in respect
of the
Capital Stock of any Person that may be issued or granted to, or
held by, such
Pledgor while this Agreement is in effect (provided that in no
event shall there
be pledged, nor shall any Pledgor be required to pledge, directly
or indirectly,
(i) any of the Capital Stock of Subsidiaries of Foreign
Subsidiaries or (ii) de
minimis shares of a Foreign Subsidiary held by any Pledgor as a
nominee or in a
similar capacity).
"Pledgor": Holdings (with respect to the Pledged Stock of the
Parent
Borrower and all other Pledged Collateral of the Parent Borrower),
the U.S.
Borrowers (with respect to Pledged Stock of the entities listed on
Schedule 2
hereto under the name of such applicable Borrower and all other
Pledged
Collateral of such applicable Borrower) and each other Granting
Party (with
respect to Pledged Securities held by such Granting Party and all
other Pledged
Collateral of such Granting Party).
"Primary Canadian Borrower Obligations": as defined in
subsection
6.5.2.
"Primary Obligations": as defined in subsection 6.5.2.
"Primary U.S. Borrower Obligations": as defined in subsection
6.5.2.
"Pro Rata Share": as defined in subsection 6.5.2.
"Proceeds": all "proceeds" as such term is defined in Section
9-102(a)(64) of the Uniform Commercial Code in effect in the State
of New York
on the date hereof and, in any event, Proceeds of Pledged
Securities shall
include, without limitation, all dividends or other income from the
Pledged
Securities, collections thereon or distributions or payments with
respect
thereto.
"Representative": as defined in subsection 6.5.4.
"Restrictive Agreements": as defined in subsection 3.3(a).
"RSC": as
defined in the recitals hereto.
"Parent Borrower": as defined in the recitals hereto.
"Second-Lien Term Loan Guarantee and Collateral Agreement":
that
certain Guarantee and Collateral Agreement, dated as of the date
hereof, among
Holdings, the Parent Borrower, RSC and DBNY, as collateral agent,
as amended,
amended and restated, waived, supplemented or otherwise modified
from time to
time.
"Secondary Canadian Borrower Obligations": as defined in
subsection
6.5.2.
"Secondary Obligations": as defined in subsection 6.5.2.
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"Secondary U.S. Borrower Obligations": as defined in subsection
6.5.2.
"Secured Parties": as defined in the recitals hereto.
"Security Collateral": with respect to any Granting Party,
means,
collectively, the Collateral (if any) and the Pledged Collateral
(if any) of
such Granting Party.
"Specified Asset": as defined in subsection 4.2.2 hereof.
"Trade Secret Licenses": with respect to any Grantor, all
written
license agreements of such Grantor providing for the grant by or to
such Grantor
of any right under any trade secrets, including, without
limitation, know how,
processes, formulae, compositions, designs, and confidential
business and
technical information, and all rights of any kind whatsoever
accruing thereunder
or pertaining thereto, other than agreements with any Person who is
an Affiliate
or a Subsidiary of the Parent Borrower or such Grantor, subject, in
each case,
to the terms of such license agreements, and the right to prepare
for sale, sell
and advertise for sale, all Inventory now or hereafter covered by
such licenses.
"Trade Secrets": with respect to any Grantor, all of such
Grantor's
right, title and interest in and to all United States and foreign
trade secrets,
including, without limitation, know-how, processes, formulae,
compositions,
designs, and confidential business and technical information, and
all rights of
any kind whatsoever accruing thereunder or pertaining thereto,
including,
without limitation, (i) all income, royalties, damages and payments
now and
hereafter due and/or payable with respect thereto, including,
without
limitation, payments under all licenses, non-disclosure agreements
and memoranda
of understanding entered into in connection therewith, and damages
and payments
for past or future misappropriations thereof, and (ii) the right to
sue or
otherwise recover for past, present or future misappropriations
thereof.
"Trademark Licenses": with respect to any Grantor, all written
license
agreements of such Grantor providing for the grant by or to such
Grantor of any
right under any trademarks, service marks, trade names, trade dress
or other
indicia of trade origin or business identifiers, and all rights of
any kind
whatsoever accruing thereunder or pertaining thereto, other than
agreements with
any Person who is an Affiliate or a Subsidiary of the Parent
Borrower or such
Grantor, including, without limitation, the material license
agreements listed
on Schedule 5 hereto, subject, in each case, to the terms of such
license
agreements, and the right to prepare for sale, sell and advertise
for sale, all
Inventory now or hereafter covered by such licenses.
"Trademarks": with respect to any Grantor, all of such
Grantor's
right, title and interest in and to all United States and foreign
trademarks,
service marks, trade names, trade dress or other indicia of trade
origin or
business identifiers, trademark and service mark registrations, and
applications
for trademark or service mark registrations (except for "intent to
use"
applications for trademark or service mark registrations filed
pursuant to
Section l(b) of the Lanham Act, 15 U.S.C. Section 1051, unless and
until an
Amendment to Allege Use or a Statement of Use under Sections l(c)
and l(d) of
said Act has been filed, it being understood and agreed that the
carve out in
this parenthetical shall be applicable only if and for so long as a
grant of a
security interest in such intent to use application would
invalidate or
otherwise jeopardize Grantor's rights therein), and any renewals
thereof,
including, without limitation, each
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registration and application identified in Schedule 5 hereto, and
including,
without limitation, (i) the right to sue or otherwise recover for
any and all
past, present and future infringements or dilutions thereof, (ii)
all income,
royalties, damages and other payments now and hereafter due and/or
payable with
respect thereto (including, without limitation, payments under all
licenses
entered into in connection therewith, and damages and payments for
past or
future infringements thereof), and (iii) all other rights
corresponding thereto
and all other rights of any kind whatsoever of such Grantor
accruing thereunder
or pertaining thereto in the United States, together in each case
with the
goodwill of the business connected with the use of, and symbolized
by, each such
trademark, service mark, trade name, trade dress or other indicia
of trade
origin or business identifiers.
"ULC Shares": shares in any unlimited company, incorporated or
organized under the laws of Canada or any province or territory
thereof, at any
time owned or otherwise held by the Grantor.
"U.S. Administrative Agent": as defined in the recitals hereto.
"U.S. Borrowers": as defined in the recitals hereto.
"U.S. Borrower Obligations" shall mean all Obligations of the
U.S.
Borrowers (but not as a Guarantor of any Canadian Borrower or any
Canadian
Subsidiary Guarantor) and any guarantees of such Obligations
pursuant to this
Agreement or pursuant to any other Loan Document.
"U.S. Collateral Account Bank": Deutsche Bank AG, New York Branch,
an
Affiliate thereof or another bank which at all times is a Lender as
selected by
the relevant Grantor and consented to in writing by the U.S.
Collateral Agent
(such consent not to be unreasonably withheld or delayed).
"U.S. Collateral Proceeds Account": a non-interest bearing cash
collateral account established and maintained by the relevant
Grantor at an
office of the U.S. Collateral Account Bank in the name, and in the
sole dominion
and control of, the U.S. Collateral Agent for the benefit of the
Secured
Parties.
Section 1.2. Other Definitional Provisions. (a) The words
"hereof,
"herein", "hereto" 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, Schedule and Annex
references are to
this Agreement unless otherwise specified.
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(c) Where the context requires, terms relating to the
Collateral,
Pledged Collateral or Security Collateral, or any part thereof,
when used in
relation to a Granting Party shall refer to such Granting Party's
Collateral,
Pledged Collateral or Security Collateral or the relevant part
thereof.
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(d) All references in this Agreement to any of the property
described
in the definition of the term "Collateral" or "Pledged Collateral",
or to any
Proceeds thereof, shall be deemed to be references thereto only to
the extent
the same constitute Collateral or Pledged Collateral,
respectively.
ARTICLE II
Guarantee
Section 2.1. Guarantee. (a) (i) Each of the Guarantors hereby,
jointly
and severally, unconditionally and irrevocably, guarantees to the
U.S.
Administrative Agent, for the ratable benefit of the applicable
Secured Parties,
the prompt and complete payment and performance by each U.S.
Borrower and
Canadian Finco when due and payable (whether at the stated
maturity, by
acceleration or otherwise) of the Borrower Obligations of such U.S.
Borrower and
Canadian Finco owed to the applicable Secured Parties, and (ii)
each of the
Guarantors hereby, jointly and severally, unconditionally and
irrevocably,
guarantees to the U.S. Administrative Agent, for the ratable
benefit of the
applicable Secured Parties, the prompt and complete payment and
performance by
each Canadian Borrower when due and payable (whether at the stated
maturity, by
acceleration or otherwise) of the Borrower Obligations of such
Canadian Borrower
owed to the applicable Secured Parties.
(b) Anything herein or in any other Loan Document to the
contrary
notwithstanding, the maximum liability of each Guarantor hereunder
and under the
other Loan Documents shall in no event exceed the amount that can
be guaranteed
by such Guarantor under applicable law, including applicable
federal and state
laws relating to the insolvency of debtors; provided that, to the
maximum extent
permitted under applicable law, it is the intent of the parties
hereto that (x)
the amount of the liability of any of the Guarantors or any
guarantee in respect
of Indebtedness permitted pursuant to clause (b) of subsection 8.2
of the Credit
Agreement shall be reduced before the amount of the liability of
the respective
Guarantor is reduced hereunder and (y) the rights of contribution
of each
Guarantor provided in following subsection 2.2 be included as an
asset of the
respective Guarantor in determining the maximum liability of such
Guarantor
hereunder.
(c) Each Guarantor agrees that the Borrower Obligations guaranteed
by
it hereunder may at any time and from time to time exceed the
amount of the
liability of such Guarantor hereunder without impairing the
guarantee contained
in this Section 2 or affecting the rights and remedies of the
U.S.
Administrative Agent or any other Secured Party hereunder.
(d) The guarantee contained in this Section 2 shall remain in
full
force and effect until the earlier to occur of (i) the first date
on which all
the Loans, any Reimbursement Obligations, all other Borrower
Obligations then
due and owing, and the obligations of each Guarantor under the
guarantee
contained in this Section 2 then due and owing shall have been
satisfied by
payment in full in cash, no Letter of Credit shall be outstanding
and the
Commitments shall have been terminated, notwithstanding that from
time to time
during the term of the Credit Agreement any of the Borrowers may be
free from
any Borrower Obligations, or (ii) as to any Guarantor, the sale or
other
disposition of all of the Capital Stock of such Guarantor
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(to a Person other than Holdings, the Parent Borrower or a
Subsidiary of either)
as permitted under the Credit Agreement.
(e) No payment made by any Borrower, any of the Guarantors, any
other
guarantor or any other Person or received or collected by the
U.S.
Administrative Agent or any other Secured Party from any of the
Borrowers, any
of the Guarantors, any other guarantor or any other Person by
virtue of any
action or proceeding or any set-off or appropriation or application
at any time
or from time to time in reduction of or in payment of any of the
Borrower
Obligations shall be deemed to modify, reduce, release or otherwise
affect the
liability of any Guarantor hereunder which shall, notwithstanding
any such
payment (other than any payment made by such Guarantor in respect
of the
Borrower Obligations or any payment received or collected from such
Guarantor in
respect of any of the Borrower Obligations), remain liable for the
Borrower
Obligations of each Borrower guaranteed by it hereunder up to the
maximum
liability of such Guarantor hereunder until the earlier to occur of
(i) the
first date on which all the Loans, any Reimbursement Obligations,
and all other
Borrower Obligations then due and owing, are paid in full in cash,
no Letter of
Credit shall be outstanding (except for Letters of Credit that have
been cash
collateralized in a manner satisfactory to the Issuing Lender) and
the
Commitments are terminated or (ii) the sale or other disposition of
all of the
Capital Stock of such Guarantor (to a Person other than Holdings,
the Parent
Borrower or a Subsidiary of either) as permitted under the Credit
Agreement.
Section 2.2. Right of Contribution. Each Guarantor hereby agrees
that
to the extent that a Guarantor shall have paid more than its
proportionate share
(based, to the maximum extent permitted by law, on the respective
Adjusted Net
Worths of the Guarantors on the date the respective payment is
made) of any
payment made hereunder, such Guarantor shall be entitled to seek
and receive
contribution from and against any other Guarantor hereunder that
has not paid
its proportionate share of such payment. Each Guarantor's right of
contribution
shall be subject to the terms and conditions of subsection 2.3. The
provisions
of this subsection 2.2 shall in no respect limit the obligations
and liabilities
of any Guarantor to the U.S. Administrative Agent and the other
Secured Parties,
and each Guarantor shall remain liable to the U.S. Administrative
Agent and the
other Secured Parties for the full amount guaranteed by such
Guarantor
hereunder.
Section 2.3. No Subrogation. Notwithstanding any payment made by
any
Guarantor hereunder or any set-off or application of funds of any
Guarantor by
the U.S. Administrative Agent or any other Secured Party, no
Guarantor shall be
entitled to be subrogated to any of the rights of the U.S.
Administrative Agent
or any other Secured Party against any Borrower or any other
Guarantor or any
collateral security or guarantee or right of offset held by the
U.S.
Administrative Agent or any other Secured Party for the payment of
the Borrower
Obligations, nor shall any Guarantor seek or be entitled to seek
any
contribution or reimbursement from the Borrower or any other
Guarantor in
respect of payments made by such Guarantor hereunder, until all
amounts owing to
the U.S. Administrative Agent and the other Secured Parties by the
Borrowers on
account of the Borrower Obligations are paid in full in cash, no
Letter of
Credit shall be outstanding and the Commitments are terminated. If
any amount
shall be paid to any Guarantor on account of such subrogation
rights at any time
when all of the Borrower Obligations shall not have been paid in
full in cash or
any Letter of Credit shall remain outstanding (and shall not have
been cash
collateralized in a manner satisfactory to the Issuing Lender) or
any of the
Commitments shall remain in effect, such amount shall be held by
such
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Guarantor in trust for the U.S. Administrative Agent and the other
Secured
Parties, segregated from other funds of such Guarantor, and shall,
forthwith
upon receipt by such Guarantor, be turned over to the U.S.
Administrative Agent
in the exact form received by such Guarantor (duly indorsed by such
Guarantor to
the U.S. Administrative Agent if required), to be held as
collateral security
for all of the Borrower Obligations (whether matured or unmatured)
guaranteed by
such Guarantor and/or then or at any time thereafter may be applied
against any
Borrower Obligations, whether matured or unmatured, in such order
as the U.S.
Administrative Agent may determine.
Section 2.4. Amendments, etc. with respect to the Obligations. To
the
maximum extent permitted by law, each Guarantor shall remain
obligated hereunder
notwithstanding that, without any reservation of rights against any
Guarantor
and without notice to or further assent by any Guarantor, any
demand for payment
of any of the Borrower Obligations made by the U.S. Collateral
Agent, the U.S.
Administrative Agent or any other Secured Party may be rescinded by
the U.S.
Collateral Agent, the U.S. Administrative Agent or such other
Secured Party and
any of the Borrower Obligations continued, and the Borrower
Obligations, or the
liability of any other Person upon or for any part thereof, or any
collateral
security or guarantee therefor or right of offset with respect
thereto, may,
from time to time, in whole or in part, be renewed, extended,
amended, waived,
modified, accelerated, compromised, subordinated, waived,
surrendered or
released by the U.S. Collateral Agent, the U.S. Administrative
Agent or any
other Secured Party, and the Credit Agreement and the other Loan
Documents and
any other documents executed and delivered in connection therewith
may be
amended, waived, modified, supplemented or terminated, in whole or
in part, as
the U.S. Collateral Agent or the U.S. Administrative Agent (or the
Required
Lenders or the applicable Lenders(s), as the case may be) may deem
advisable
from time to time, and any collateral security, guarantee or right
of offset at
any time held by the U.S. Collateral Agent, the U.S. Administrative
Agent or any
other Secured Party for the payment of any of the Borrower
Obligations may be
sold, exchanged, waived, surrendered or released. None of the U.S.
Collateral
Agent, the U.S. Administrative Agent and each other Secured Party
shall have any
obligation to protect, secure, perfect or insure any Lien at any
time held by it
as security for any of the Borrower Obligations or for the
guarantee contained
in this Section 2 or any property subject thereto, except to the
extent required
by applicable law.
Section 2.5. Guarantee Absolute and Unconditional. Each
Guarantor
waives, to the maximum extent permitted by applicable law, any and
all notice of
the creation, renewal, extension or accrual of any of the Borrower
Obligations
and notice of or proof of reliance by the U.S. Collateral Agent,
the U.S.
Administrative Agent or any other Secured Party upon the guarantee
contained in
this Section 2 or acceptance of the guarantee contained in this
Section 2; each
of the Borrower Obligations, and any obligation contained therein,
shall
conclusively be deemed to have been created, contracted or
incurred, or renewed,
extended, amended or waived, in reliance upon the guarantee
contained in this
Section 2; and all dealings between any of the Borrowers and any of
the
Guarantors, on the one hand, and the U.S. Collateral Agent, the
U.S.
Administrative Agent and the other Secured Parties, on the other
hand, likewise
shall be conclusively presumed to have been had or consummated in
reliance upon
the guarantee contained in this Section 2. Each Guarantor waives,
to the maximum
extent permitted by applicable law, diligence, presentment,
protest, demand for
payment and notice of default or nonpayment to or upon any Borrower
or any of
the other Guarantors with respect to any of the Borrower
Obligations. Each
Guarantor understands and agrees, to the extent permitted by
law,
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that the guarantee contained in this Section 2 shall be construed
as a
continuing, absolute and unconditional guarantee of payment and not
of
collection. Each Guarantor hereby waives, to the maximum extent
permitted by
applicable law, any and all defenses (other than any suit for
breach of a
contractual provision of any of the Loan Documents) that it may
have arising out
of or in connection with any and all of the following: (a) the
validity or
enforceability of the Credit Agreement or any other Loan Document,
any of the
Borrower Obligations or any other collateral security therefor or
guarantee or
right of offset with respect thereto at any time or from time to
time held by
the U.S. Collateral Agent, the U.S. Administrative Agent or any
other Secured
Party, (b) any defense, set-off or counterclaim (other than a
defense of payment
or performance) that may at any time be available to or be asserted
by any of
the Borrowers against the U.S. Collateral Agent, the U.S.
Administrative Agent
or any other Secured Party, (c) any change in the time, place,
manner or place
of payment, amendment, or waiver or increase in any of the
Obligations, (d) any
exchange, taking, or release of Security Collateral, (e) any change
in the
structure or existence of any of the Borrowers, (f) any application
of Security
Collateral to any of the Obligations, (g) any law, regulation or
order of any
jurisdiction, or any other event, affecting any term of any
Obligation or the
rights of the U.S. Collateral Agent, the U.S. Administrative Agent
or any other
Secured Party with respect thereto, including, without limitation:
(i) the
application of any such law, regulation, decree or order, including
any prior
approval, which would prevent the exchange of any currency (other
than Dollars)
for Dollars or the remittance of funds outside of such jurisdiction
or the
unavailability of Dollars in any legal exchange market in such
jurisdiction in
accordance with normal commercial practice, (ii) a declaration of
banking
moratorium or any suspension of payments by banks in such
jurisdiction or the
imposition by such jurisdiction or any Governmental Authority
thereof of any
moratorium on, the required rescheduling or restructuring of, or
required
approval of payments on, any indebtedness in such jurisdiction,
(iii) any
expropriation, confiscation, nationalization or requisition by such
country or
any Governmental Authority that directly or indirectly deprives any
Borrower of
any assets or their use, or of the ability to operate its business
or a material
part thereof, or (iv) any war (whether or not declared),
insurrection,
revolution, hostile act, civil strife or similar events occurring
in such
jurisdiction which has the same effect as the events described in
clause (i),
(ii) or (iii) above (in each of the cases contemplated in clauses
(i) through
(iv) above, to the extent occurring or existing on or at any time
after the date
of this Agreement), or (h) any other circumstance whatsoever (other
than payment
in full in cash of the Borrower Obligations guaranteed by it
hereunder) (with or
without notice to or knowledge of any of the Borrowers or such
Guarantor) that
constitutes, or might be construed to constitute, an equitable or
legal
discharge of any of the Borrowers for the Borrower Obligations, or
of such
Guarantor under the guarantee contained in this Section 2, in
bankruptcy or in
any other instance. When making any demand hereunder or otherwise
pursuing its
rights and remedies hereunder against any Guarantor, the U.S.
Collateral Agent,
the U.S. Administrative Agent and any other Secured Party may, but
shall be
under no obligation to, make a similar demand on or otherwise
pursue such rights
and remedies as it may have against any of the Borrowers, any other
Guarantor or
any other Person or against any collateral security or guarantee
for the
Borrower Obligations guaranteed by such Guarantor hereunder or any
right of
offset with respect thereto, and any failure by the U.S. Collateral
Agent, the
U.S. Administrative Agent or any other Secured Party to make any
such demand, to
pursue such other rights or remedies or to collect any payments
from the
Borrower, any other Guarantor or any other Person or to realize
upon any such
collateral security or guarantee or to exercise any such right of
offset, or any
release of any of the
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Borrower, any other Guarantor or any other Person or any such
collateral
security, guarantee or right of offset, shall not relieve any
Guarantor of any
obligation or liability hereunder, and shall not impair or affect
the rights and
remedies, whether express, implied or available as a matter of law,
of the U.S.
Collateral Agent, the U.S. Administrative Agent or any other
Secured Party
against any Guarantor. For the purposes hereof "demand" shall
include the
commencement and continuance of any legal proceedings.
Section 2.6. Reinstatement. The guarantee of any Guarantor
contained
in this Section 2 shall continue to be effective, or be reinstated,
as the case
may be, if at any time payment, or any part thereof, of any of the
Borrower
Obligations guaranteed by such Guarantor hereunder is rescinded or
must
otherwise be restored or returned by the U.S. Collateral Agent, the
U.S.
Administrative Agent or any other Secured Party upon the
insolvency, bankruptcy,
dissolution, liquidation or reorganization of any Borrower or any
Guarantor, or
upon or as a result of the appointment of a receiver, intervenor or
conservator
of, or trustee or similar officer for, any Borrower or any
Guarantor or any
substantial part of its property, or otherwise, all as though such
payments had
not been made.
Section 2.7. Payments. Each Guarantor hereby guarantees that
payments
hereunder will be paid to the U.S. Administrative Agent without
set-off or
counterclaim, in Dollars (or in the case of any amount required to
be paid in
any other currency pursuant to the requirements of the Credit
Agreement or other
agreement relating to the respective Obligations, such other
currency), at the
U.S. Administrative Agent's office specified in subsection 11.2 of
the Credit
Agreement or such other address as may be designated in writing by
the U.S.
Administrative Agent to such Guarantor from time to time in
accordance with
subsection 11.2 of the Credit Agreement.
ARTICLE III
Grant of Security Interest
Section 3.1. Grant. Each Grantor hereby grants, subject to
existing
licenses to use the Copyrights, Patents, Trademarks and Trade
Secrets granted by
such Grantor in the ordinary course of business, to the U.S.
Collateral Agent,
for the ratable benefit of the Secured Parties, a security interest
in all of
the Collateral of such Grantor, as collateral security for the
prompt and
complete payment and performance when due (whether at the stated
maturity, by
acceleration or otherwise) of the Obligations of such Grantor,
except as
provided in subsection 3.3. The term "Collateral", as to any
Grantor, means the
following property (wherever located) now owned or at any time
hereafter
acquired by such Grantor or in which such Grantor now has or at any
time in the
future may acquire any right, title or interest, except as provided
in
subsection 3.3:
(a) all Accounts;
(b) all Accounts Receivable;
(c) all Money (including all cash);
(d) all Cash Equivalents;
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(e) all Chattel Paper;
(f) all Contracts;
(g) all Deposit Accounts (including DDAs);
(h) all Documents;
(i) all Equipment;
(j) all General Intangibles;
(k) all Instruments;
(l) all insurance proceeds;
(m) all Intellectual Property;
(n) all Inventory;
(o) all Investment Property;
(p) all Letter of Credit Rights;
(q) all Rental Fleet;
(r) all Fixtures;
(s) all Commercial Tort Claims constituting Commercial Tort
Actions
described in Schedule 7 (together with any Commercial Tort Actions
subject
to a
further writing provided in accordance with subsection 5.2.12);
(t) all books and records pertaining to any of the foregoing;
(u) the U.S. Collateral Proceeds Account; and
(v) to the extent not otherwise included, all Proceeds and products
of
any
and all of the foregoing and all collateral security and
guarantees
given by any Person with respect to any of the foregoing;
provided that, in the case of each Grantor, (w) Collateral shall
not include any
Pledged Collateral, or any property or assets specifically excluded
from Pledged
Collateral, (x) to the extent any Capital Stock of any Foreign
Subsidiary is
pledged hereunder which represent more than 65% of all classes of
the Capital
Stock of the respective Foreign Subsidiary (with all Capital Stock
of the
respective Foreign Subsidiary in excess of said 65% limit being
herein called
"Excess Foreign Subsidiary Capital Stock"), such Excess Foreign
Subsidiary
Capital Stock shall secure Borrower Obligations of the respective
Grantor only
as a guarantor of the Borrower Obligations of the Canadian
Borrowers, and shall
not secure any direct Obligations of the U.S. Borrowers (or
guarantees of such
Obligations by the respective Grantor) and (y) each Grantor
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shall be required to pledge hereunder 65% of the Capital Stock of
each Foreign
Subsidiary at any time and from time to time acquired by such
Grantor, which
Capital Stock shall not be subject to the limitations described in
preceding
clause (x).
Section 3.2. Pledged Collateral. Each Granting Party that is a
Pledgor, hereby grants to the U.S. Collateral Agent, for the
ratable benefit of
the Secured Parties, a security interest in all of the Pledged
Collateral of
such Pledgor now owned or at any time hereafter acquired by such
Pledgor, and
any Proceeds thereof, as collateral security for the prompt and
complete payment
and performance when due (whether at the stated maturity, by
acceleration or
otherwise) of the Obligations of such Pledgor, except as provided
in subsection
3.3.
Section 3.3. Certain Limited Exceptions. No security interest is
or
will be granted pursuant hereto in any right, title or interest of
any Granting
Party under or in (collectively, the "Excluded Assets"):
(a) any Instruments, Contracts, Chattel Paper, General
Intangibles,
Copyright Licenses, Patent Licenses, Trademark Licenses, Trade
Secret
Licenses or other contracts or agreements with or issued by Persons
other
than
Holdings, a Subsidiary of Holdings or an Affiliate thereof,
(collectively, "Restrictive Agreements") that would otherwise be
included
in
the Security Collateral (and such Restrictive Agreements shall not
be
deemed to constitute a part of the Security Collateral) for so long
as, and
to
the extent that, the granting of such a security interest
pursuant
hereto would result in a breach, default or termination of such
Restrictive
Agreements (in each case, except to the extent that, pursuant to
the Code
or
other applicable law, the granting of security interests therein
can be
made
without resulting in a breach, default or termination of such
Restrictive Agreements);
(b) any Equipment that would otherwise be included in the
Security
Collateral (and such Equipment shall not be deemed to constitute a
part of
the
Security Collateral) if such Equipment is subject to a Lien
permitted
by
subsection 8.3(h) of the Credit Agreement (but only for so long as
such
Liens are in place);
(c) any property that would otherwise be included in the
Security
Collateral (and such
property shall not be deemed to constitute a part of
the
Security Collateral) if such property has been sold or
otherwise
transferred in connection with a Sale and Leaseback Transaction
permitted
under subsection 8.11 of the Credit Agreement, or is subject to any
Liens
permitted under subsection 8.3(n) of the Credit Agreement.
Notwithstanding
the
foregoing, the security interest of the Collateral Agent shall
attach
to
any money, securities or other consideration received by any
Grantor as
consideration for the sale or other disposition of such
property;
(d) any Intellectual Property governed by the laws of a
jurisdiction
in
which a security interest or similar lien of any kind is
prohibited
under that jurisdiction's laws, for so long as the laws of that
jurisdiction so provide;
(e) Capital Stock which is specifically excluded from the
definition
of
Pledged Stock by virtue of the proviso contained in the
parenthetical to
such
definition;
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(f) Capital Stock issued by Canadian Finco and any other ULC
Shares.
If
the Grantor acquires any ULC Shares, it shall promptly notify the
U.S.
Collateral Agent. Upon the request of the U.S. Collateral Agent,
such
Grantor shall execute and deliver all such agreements and deliver
all such
other documents, opinions and certificates (including without
limitation
share certificates evidencing such ULC Shares) as the U.S.
Collateral Agent
may
reasonably require to receive a perfected, first ranking
priority
security interest in the ULC Shares, in each case, in form and
substance
reasonably acceptable to the U.S. Collateral Agent;
(g) Any forward contracts between RSC and RSC Canada entered into
in
connection with the loan made by Canadian Finco to RSC Canada;
or
(h) any Money, cash, checks, other negotiable instrument, funds
and
other evidence of payment held in any Deposit Account of the
Parent
Borrower or any of its Subsidiaries (i) for the benefit of
customers of any
Granting Party or any of its Subsidiaries in the ordinary course
of
business and (ii) in the nature of security deposit with respect
to
obligations for the benefit of the Parent Borrower or any of
its
Subsidiaries, which must be held for or returned to the
applicable
counterparty under applicable law or pursuant to Contractual
Obligations.
Section 3.4. Intercreditor Relations. Notwithstanding anything
herein
to the contrary, it is the understanding of the parties that the
Liens granted
pursuant to this Agreement shall with respect to all Security
Collateral, be
senior to the Liens granted to the Second-Lien Collateral Agent (as
defined in
the Intercreditor Agreement) for the benefit of the holders of the
Second-Lien
Obligations (as defined in the Intercreditor Agreement) to secure
the
Second-Lien Obligations (as defined in the Intercreditor Agreement)
pursuant to
the Second-Lien Term Loan Guarantee and Collateral Agreement.
Notwithstanding
anything herein to the contrary, the Liens and security interest
granted to the
U.S. Collateral Agent pursuant to this Agreement and the exercise
of any right
or remedy by the U.S. Collateral Agent hereunder are subject to the
provisions
of the Intercreditor Agreement. In the event of any conflict
between the terms
of the Intercreditor Agreement and this Agreement, the terms of
the
Intercreditor Agreement shall govern and control.
ARTICLE IV
Representations and Warranties
Section 4.1. Representations and Warranties of Each Guarantor.
To
induce the U.S. Collateral Agent and the Lenders to enter into the
Credit
Agreement and to induce the Lenders to make their respective
extensions of
credit to the Borrowers thereunder, each Guarantor hereby
represents and
warrants to the U.S. Collateral Agent and each other Secured Party
that the
representations and warranties set forth in Section 5 of the Credit
Agreement as
they relate to such Guarantor or to the Loan Documents to which
such Guarantor
is a party, each of which representations and warranties is hereby
incorporated
herein by reference, are true and correct in all material respects,
and the U.S.
Collateral Agent and each other Secured Party shall be entitled to
rely on each
of such representations and warranties as if fully set forth
herein; provided
that each reference in each such representation and warranty to the
Parent
Borrower's knowledge
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shall, for the purposes of this subsection 4.1, be deemed to be a
reference to
such Guarantor's knowledge.
Section 4.2. Representations and Warranties of Each Grantor. To
induce
the U.S. Collateral Agent and the Lenders to enter into the Credit
Agreement and
to induce the Lenders to make their respective extensions of credit
to the
Borrowers thereunder, each Grantor hereby represents and warrants
to the U.S.
Collateral Agent and each other Secured Party that, in each case
after giving
effect to the Transactions:
4.2.1 Title; No Other Liens. Except for the security interests
granted
to
the U.S. Collateral Agent for the ratable benefit of the Secured
Parties
pursuant to this Agreement and the other Liens permitted to exist
on such
Grantor's Collateral by the Credit Agreement (including,
without
limitation, subsection 8.3 thereof), such Grantor owns each item of
such
Grantor's Collateral free and clear of any and all Liens. Except as
set
forth on Schedule 3, no currently effective financing statement or
other
similar public notice with respect to all or any part of such
Grantor's
Collateral is on file or of record in any public office, except
such as
have
been filed in favor of the U.S. Collateral Agent for the
ratable
benefit of the Secured Parties pursuant to this Agreement or as
are
permitted by the Credit Agreement (including without limitation
subsection
8.3
thereof) or any other Loan Document or for which termination
statements
will
be delivered on the Closing Date.
4.2.2 Perfected First Priority Liens. (a) This Agreement is
effective
to
create, as collateral security for the Obligations of such
Grantor,
valid and enforceable Liens on such Grantor's Security Collateral
in favor
of
the U.S. Collateral Agent for the benefit of the Secured Parties,
except
(i)
with respect to all Intellectual Property that is an Excluded Asset
or
(ii)
as enforceability may be affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar
laws
relating to or affecting creditor's rights generally, general
equitable
principles (whether considered in a proceeding in equity or at law)
and an
implied covenant of good faith and fair dealing.
(b) Except with regard to (i) Liens (if any) on Specified Assets
and
(ii)
any rights in favor of the United States government as required by
law
(if
any), upon the completion of the Filings and, with respect to
Instruments, Chattel Paper and Documents upon the earlier of such
Filing or
the
delivery to and continuing possession by the U.S. Collateral Agent,
of
all
Instruments, Chattel Paper and Documents a security interest in
which
is
perfected by possession, and the obtaining and maintenance of
"control"
(as
described in the Code) by the U.S. Collateral Agent, the
Canadian
Collateral Agent, the U.S. Administrative Agent, as applicable (or
their
respective agents appointed for purposes of perfection), in
accordance with
the
Intercreditor Agreement of all Deposit Accounts, the U.S.
Collateral
Proceeds Account, Electronic Chattel Paper and Letter of Credit
Rights a
security interest in which is perfected by "control" and in the
case of
Commercial Tort Actions (other than such Commercial Tort Actions
listed on
Schedule 7 on the date of this Agreement), the taking of the
actions
required by subsection 5.2.12 herein, the Liens created pursuant to
this
Agreement will constitute valid Liens on and (to the extent
provided
herein) perfected security interests in such Grantor's Security
Collateral
in
favor of the U.S. Collateral Agent for the benefit of the
Secured
Parties, and
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will
be prior to all other Liens of all other Persons other than
Permitted
Liens, and enforceable as such as against all other Persons other
than
Ordinary Course Transferees, except to the extent that the
recording of an
assignment or other transfer of title to the U.S. Collateral Agent
or the
recording of other applicable documents in the United States Patent
and
Trademark Office or United States Copyright Office may be necessary
for
perfection or enforceability, and except as enforceability may be
limited
by
applicable bankruptcy, insolvency, reorganization, moratorium or
similar
laws
affecting the enforcement of creditors' rights generally and by
general equitable principles (whether enforcement is sought by
proceedings
in
equity or at law) or by an implied covenant of good faith and
fair
dealing. As used in this subsection 4.2.2(b), the following terms
shall
have
the following meanings:
"Filings": the filing or recording of (i) the Financing
Statements as set forth in Schedule 3, (ii) this Agreement or a
notice
thereof with respect to Intellectual Property as set forth in
Schedule 3,
(iii) the recordation after the Closing Date on the certificate of
title
related thereto of each Lien granted in favor of the U.S.
Collateral Agent
hereunder, subject to certificate of title statutes, and (iv) any
filings
after the Closing Date in any other jurisdiction as may be
necessary under
any
Requirement of Law.
"Financing Statements": the financing statements delivered to
the
U.S.
Collateral Agent by such Grantor on the Closing Date for filing in
the
jurisdictions listed in Schedule 4.
"Ordinary Course Transferees": (i) with respect to goods only,
buyers in the ordinary course of business and lessees in the
ordinary
course of business to the extent provided in Section 9-320(a) and
9-321 of
the
Uniform Commercial Code as in effect from time to time in the
relevant
jurisdiction, (ii) with respect to general intangibles only,
licensees in
the
ordinary course of business to the extent provided in Section 9-321
of
the
Uniform Commercial Code as in effect from time to time in the
relevant
jurisdiction and (iii) any other Person who is entitled to take
free of the
Lien
pursuant to the Uniform Commercial Code as in effect from time to
time
in
the relevant jurisdiction.
"Permitted Liens": Liens permitted pursuant to the Credit
Documents, including without limitation those permitted to exist
pursuant
to
subsection 8.3 of the Credit Agreement.
"Specified Assets": the following property and assets of such
Grantor:
(1) Patents, Patent Licenses, Trademarks and Trademark Licenses
to the extent that (a) Liens thereon cannot be perfected by the
filing
of financing statements under the Uniform Commercial Code or by
the
filing and acceptance thereof in the United States Patent and
Trademark Office (including Liens on such Patents, Patent
Licenses,
Trademarks and Trademark Licenses that are non-U.S. Patents,
Patent
Licenses, Trademarks and Trademark Licenses) or (b) such
Patents,
Patent Licenses, Trademarks and Trademark Licenses are not,
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<PAGE>
individually or in the aggregate, material to the business of
the
Parent Borrower and its Subsidiaries taken as a whole;
(2) Copyrights and Copyright Licenses with respect thereto and
Accounts or receivables arising therefrom to the extent that
the
Uniform Commercial Code as in effect from time to time in the
relevant
jurisdiction is not applicable to the creation or perfection of
Liens
thereon;
(3) Collateral for which the perfection of Liens thereon
requires
filings in or other actions under the laws of jurisdictions outside
of
the United States of America, any State, territory or
dependency
thereof or the District of Columbia;
(4) goods included in Collateral received by any Person from
any
Grantor for "sale or return" within the meaning of Section 2-326
of
the Uniform Commercial Code of the applicable jurisdiction, to
the
extent of
claims of creditors of such Person;
(5) Equipment constituting Fixtures (other than any such
Equipment subject to a Mortgage);
(6) Proceeds of Accounts or Inventory which do not themselves
constitute Collateral or which have not yet been transferred to
or
deposited in the U.S. Collateral Proceeds Account (if any) or to
a
Blocked Account; and
(7) uncertificated securities (to the extent a security
interest
is not perfected by the filing of a financing statement).
4.2.3 Jurisdiction of Organization. On the date hereof, such
Grantor's
jurisdiction of organization is specified on Schedule 4.
4.2.4 Farm Products. None of such Grantor's Collateral constitutes,
or
is
the Proceeds of, Farm Products.
4.2.5 Accounts Receivable. The amounts represented by such Grantor
to
the
U.S. Administrative Agent or the other Secured Parties from time
to
time
as owing by each account debtor or by all account debtors in
respect
of
such Grantor's Accounts Receivable constituting Security Collateral
will
at
such time be the correct amount, in all material respects,
actually
owing by such account debtor or debtors thereunder, except to the
extent
that
appropriate reserves therefor have been established on the books
of
such
Grantor in accordance with GAAP. Unless otherwise indicated in
writing
to
the U.S. Administrative Agent, each Account Receivable of such
Grantor
arises out of a bona fide sale and delivery of goods or rendition
of
services by such Grantor. Such Grantor has not given any account
debtor any
deduction in respect of the amount due under any such Account,
except in
the
ordinary course of business or as such Grantor may otherwise advise
the
U.S.
Administrative Agent in writing.
4.2.6 Patents, Copyrights and Trademarks. Schedule 5 lists all
material Trademarks, material Copyrights and material Patents, in
each
case, registered in the
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United States Patent and Trademark Office or the United States
Copyright
Office or other equivalent foreign office, as applicable, and owned
by such
Grantor in its own
name as of the date hereof, and all material Trademark
Licenses, all material Copyright Licenses and all material Patent
Licenses
(including, without limitation, material Trademark Licenses for
registered
Trademarks, material Copyright Licenses for registered Copyrights
and
material Patent Licenses for registered Patents) owned by such
Grantor in
its
own name as of the date hereof.
Section 4.3. Representations and Warranties of Each Pledgor. To
induce
the U.S. Collateral Agent, the U.S. Administrative Agent and the
Lenders to
enter into the Credit Agreement and to induce the Lenders to make
their
respective extensions of credit to the Borrowers thereunder, each
Pledgor hereby
represents and warrants to the U.S. Collateral Agent and each other
Secured
Party that:
4.3.1 Except as provided in subsection 3.3, the shares of
Pledged
Stock pledged by such Pledgor hereunder constitute all the issued
and
outstanding shares of all classes of the Capital Stock of such
Subsidiary
owned by such Pledgor.
4.3.2 All the shares of the Pledged Stock pledged by such
Pledgor
hereunder have been duly and validly issued and are fully paid
and
nonassessable (or the equivalent, if any, under applicable foreign
law).
4.3.3 Such Pledgor is the record and beneficial owner of, and has
good
title to, the Pledged Securities pledged by it hereunder, free of
any and
all
Liens or options in favor of, or claims of, any other Person,
except
the
security interest created by this Agreement and Liens arising
by
operation of law or permitted by the Credit Agreement.
4.3.4 Upon the delivery to the U.S. Collateral Agent of the
certificates, if any, evidencing
