<PAGE>
Exhibit 4.7
EXECUTION VERSION
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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 Administrative Agent and 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.....................................................
10
Section 2.1.
Guarantee...............................................
10
Section 2.2.
Right of
Contribution................................... 11
Section 2.3.
No
Subrogation.......................................... 11
Section 2.4.
Amendments, etc. with
respect to the Obligations........ 12
Section 2.5.
Guarantee Absolute and
Unconditional.................... 12
Section 2.6.
Reinstatement...........................................
14
Section 2.7.
Payments................................................
14
ARTICLE III Grant of Security
Interest................................... 14
Section 3.1.
Grant...................................................
14
Section 3.2.
Pledged
Collateral...................................... 15
Section 3.3.
Certain Limited
Exceptions.............................. 16
Section 3.4.
Intercreditor
Relations................................. 17
ARTICLE IV Representations and
Warranties................................ 17
Section 4.1.
Representations and
Warranties of Each Guarantor........ 17
Section 4.2.
Representations and
Warranties of Each Grantor.......... 17
Section 4.3.
Representations and
Warranties of Each Pledgor.......... 21
ARTICLE V
Covenants......................................................
22
Section 5.1.
Covenants of Each
Guarantor............................. 22
Section 5.2.
Covenants of Each
Grantor............................... 22
Section 5.3.
Covenants of Each
Pledgor............................... 26
ARTICLE VI Remedial
Provisions........................................... 27
Section 6.1.
Certain Matters
Relating to Accounts.................... 27
Section 6.2.
Communications with
Obligors; Grantors Remain Liable.... 29
Section 6.3.
Pledged
Stock........................................... 29
Section 6.4.
Proceeds to be Turned
Over To Collateral Agent.......... 31
Section 6.5.
Application of
Proceeds................................. 31
Section 6.6.
Code and Other
Remedies................................. 33
Section 6.7.
Registration
Rights..................................... 34
Section 6.8.
Waiver;
Deficiency...................................... 35
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ARTICLE VII The Collateral
Agent......................................... 35
Section 7.1.
Collateral Agent's
Appointment as Attorney-in-Fact,
etc.....................................................
35
Section 7.2.
Duty of Collateral
Agent................................ 37
Section 7.3.
Financing
Statements.................................... 37
Section 7.4.
Authority of
Collateral Agent........................... 37
Section 7.5.
Right of
Inspection..................................... 38
ARTICLE VIII Non-Lender Secured
Parties.................................. 38
Section 8.1.
Rights to
Collateral.................................... 38
Section 8.2.
Appointment of
Agent.................................... 39
Section 8.3. Waiver of
Claims........................................ 39
ARTICLE IX
Miscellaneous.................................................
40
Section 9.1.
Amendments in
Writing................................... 40
Section 9.2.
Notices.................................................
40
Section 9.3.
No Waiver by Course of
Conduct; Cumulative Remedies..... 40
Section 9.4.
Enforcement Expenses;
Indemnification................... 41
Section 9.5.
Successors and
Assigns.................................. 41
Section 9.6.
Set-Off.................................................
41
Section 9.7.
Counterparts............................................
42
Section 9.8.
Severability............................................
42
Section 9.9.
Section
Headings........................................ 42
Section 9.10.
Integration.............................................
42
Section 9.11.
GOVERNING LAW...........................................
42
Section 9.12.
Submission To Jurisdiction; Waivers.....................
43
Section 9.13.
Acknowledgments.........................................
43
Section 9.14.
WAIVER OF JURY TRIAL....................................
44
Section 9.15. Additional Granting
Parties............................. 44
Section 9.16.
Releases................................................
44
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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
Schedule 7 --
Commercial Tort Claims
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ANNEXES
Annex 1 --
Acknowledgement and Consent of Issuers who are not Granting
Parties
Annex 2 --
Assumption Agreement
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(iii)
<PAGE>
GUARANTEE AND COLLATERAL AGREEMENT
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
"Collateral
Agent") and administrative agent (in such capacity, the
"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 Second-Lien Term Loan 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 6.9(b) of the Credit Agreement, the
"Borrowers"), the
Collateral Agent, the Administrative 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, the
Administrative Agent and the Collateral 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 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 execute and deliver this Agreement to the
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
<PAGE>
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"); and
WHEREAS, the Collateral Agent and the U.S. Collateral Agent
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
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
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:
"ABL Guarantee and Collateral Agreement": that certain U.S.
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.
"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 liabilities, but
without
giving effect to any of its obligations under this Agreement or any
other
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Loan Document, or pursuant to its guarantee with respect to any
Indebtedness
then outstanding pursuant to clauses (b) and (d) of subsection 7.1
of the Credit
Agreement) on such date.
"Administrative Agent": as defined in the recitals hereto.
"Agreement": this 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 Term Loans 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 Term Loans 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 Term Loans,
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 or a termination of any transaction entered into pursuant
to any such
Interest Rate Protection Agreement or Permitted Hedging
Arrangement, fees,
indemnities, costs, expenses or otherwise (including, without
limitation, all
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<PAGE>
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": as defined in the recitals hereto.
"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 the Term Loan
Commitments.
"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
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
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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.
"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 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, fees,
indemnities, costs, expenses or otherwise (including, without
limitation, all
fees and disbursements of counsel to the 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).
"Guarantors": the collective reference to each Granting Party
other
than Holdings.
"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.
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<PAGE>
"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 7.4 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.
"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.
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"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 7.16 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.
"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 6.9 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) more than 65% of any series of the outstanding Capital Stock of
any Foreign
Subsidiary, (ii) any of the Capital Stock of a Subsidiary of a
Foreign
Subsidiary and (iii) de minimis shares of a Foreign Subsidiary held
by any
Pledgor as a nominee or in a similar capacity).
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"Pledgor": Holdings (with respect to the Pledged Stock of the
Parent
Borrower and all other Pledged Collateral of the Parent Borrower),
the 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 Obligations": as defined in subsection 6.5.2.
"Primary 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 6.5.3.
"Restrictive Agreements": as defined in subsection 3.3(a).
"RSC": as defined in the recitals hereto.
"Secondary Obligations": as defined in subsection 6.5.2.
"Secondary 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
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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 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.
"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 Collateral
Agent (such
consent not to be unreasonably withheld or delayed).
"U.S. Collateral Agent": the U.S. Collateral Agent as defined in
the
ABL Guarantee and Collateral Agreement.
"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
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Account Bank in the name, and in the sole dominion and control of,
the
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.
(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) Each of the Guarantors hereby,
jointly and severally, unconditionally and irrevocably, guarantees
to the
Administrative Agent, for the ratable benefit of the applicable
Secured Parties,
the prompt and complete payment and performance by each Borrower
when due and
payable (whether at the stated maturity, by acceleration or
otherwise) of the
Borrower Obligations of such 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 7.1
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
Administrative
Agent or any other Secured Party hereunder.
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<PAGE>
(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 Term Loans, 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 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 (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
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 Term Loans and other Borrower Obligations then due and
owing, are paid
in full in cash 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 Administrative Agent and the other Secured
Parties, and
each Guarantor shall remain liable to the 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 Administrative Agent or any other Secured Party, no
Guarantor shall be
entitled to be subrogated to any of the rights of the
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
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
Administrative
Agent and the other Secured Parties by the
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<PAGE>
Borrowers on account of the Borrower Obligations are paid in full
in cash. 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 of the Commitments shall remain in effect, such
amount shall
be held by such Guarantor in trust for the 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
Administrative
Agent in the exact form received by such Guarantor (duly indorsed
by such
Guarantor to the 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 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
Collateral Agent, the
Administrative Agent or any other Secured Party may be rescinded by
the
Collateral Agent, the 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 Collateral Agent, the 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
Collateral
Agent or the 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
Collateral Agent, the 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 Collateral Agent, the
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 Collateral Agent, the
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 Collateral Agent, the 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
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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, 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 Collateral Agent, the 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 Collateral Agent,
the
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 Collateral Agent, the
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 Collateral Agent, the 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
Collateral Agent, the Administrative Agent or any other Secured
Party to make
any such demand, to pursue such other
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<PAGE>
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
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
Collateral Agent, the 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 Collateral Agent, the
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 Administrative Agent without
set-off or
counterclaim, in Dollars, at the Administrative Agent's office
specified in
subsection 10.2 of the Credit Agreement or such other address as
may be
designated in writing by the Administrative Agent to such Guarantor
from time to
time in accordance with subsection 10.2 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
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, Collateral shall not
include any
Pledged Collateral, or any property or assets specifically excluded
from Pledged
Collateral (including any Capital Stock of any Foreign Subsidiary
in excess of
65% of any series of such stock).
Section 3.2. Pledged Collateral. Each Granting Party that is a
Pledgor, hereby grants to the 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
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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 7.2(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 7.10 of the Credit Agreement, or is subject to any
Liens
permitted under subsection 7.2(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; or
(f) Capital Stock issued by Canadian Finco; or
(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
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<PAGE>
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
are second to the Liens granted to the First-Lien Collateral Agent
(as defined
in the Intercreditor Agreement) for the benefit of the holders of
the First-Lien
Obligations (as defined in the Intercreditor Agreement) to secure
the First-Lien
Obligations (as defined in the Intercreditor Agreement) pursuant to
the U.S.
Guarantee and Collateral Agreement. Notwithstanding anything herein
to the
contrary, the Liens and security interest granted to the Collateral
Agent
pursuant to this Agreement and the exercise of any right or remedy
by the
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. Notwithstanding any other provision hereof, for
so long as
any First-Lien Obligations (as defined in the Intercreditor
Agreement) remain
outstanding, any obligation hereunder to physically deliver to the
Collateral
Agent any Security Collateral constituting First-Lien Collateral
(as defined in
the Intercreditor Agreement) shall be satisfied by causing such
First-Lien
Collateral to be physically delivered to the U.S. Collateral Agent
to be held in
accordance with the Intercreditor Agreement.
ARTICLE IV
Representations and Warranties
Section 4.1. Representations and Warranties of Each Guarantor.
To
induce the 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
Collateral Agent and each other Secured Party that the
representations and
warranties set forth in Section 4 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 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 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 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
Collateral Agent and each other Secured Party that, in each case
after giving
effect to the Transactions:
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4.2.1 Title; No Other Liens. Except for the security interests
granted
to
the 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 7.3 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 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 7.3
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 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 Collateral Agent or
the
U.S.
Collateral Agent, as applicable, in accordance with the
Intercreditor
Agreement, 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 Collateral Agent or the 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 Collateral Agent for the
benefit of the
Secured Parties, and 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
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
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<PAGE>
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 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
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 7.2 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,
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;
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<PAGE>
(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
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
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
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 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.
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<PAGE>
Section 4.3. Representations and Warranties of Each Pledgor. To
induce the Collateral Agent, the 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 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 (i) in the case
of
shares of a Domestic Subsidiary, all the issued and outstanding
shares of
all
classes of the Capital Stock of such Domestic Subsidiary owned by
such
Pledgor and (ii) in the case of any Pledged Stock constituting
Capital
Stock of any Foreign Subsidiary, such percentage (not more than
65%) as is
specified on Schedule 2 of all the issued and outstanding shares of
all
classes of the Capital Stock of each such Foreign 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
