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EXHIBIT 10.62
EXECUTION VERSION
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FIRST LIEN GUARANTEE AND COLLATERAL AGREEMENT
dated as of August 24, 2007,
among
PACIFIC ENERGY ALASKA OPERATING LLC,
as the Borrower,
PACIFIC ENERGY ALASKA HOLDINGS, LLC,
as Holdings,
the Subsidiaries of the Borrower from time to time party hereto
and
SILVER POINT FINANCE, LLC,
as Collateral Agent
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
SECTION 1.01 CREDIT
AGREEMENT...........................................................................1
SECTION 1.02 OTHER DEFINED
TERMS........................................................................2
ARTICLE II
GUARANTEE
SECTION 2.01
GUARANTEE..................................................................................6
SECTION 2.02 GUARANTEE OF PAYMENT;
CONTINUING
GUARANTEE.................................................6
SECTION 2.03 NO LIMITATIONS,
ETC........................................................................6
SECTION 2.04
REINSTATEMENT..............................................................................7
SECTION 2.05 AGREEMENT TO PAY;
SUBROGATION..............................................................7
SECTION 2.06
INFORMATION................................................................................8
SECTION 2.07
TAXES......................................................................................8
ARTICLE III
PLEDGE OF SECURITIES
SECTION 3.01
PLEDGE.....................................................................................8
SECTION 3.02 DELIVERY OF THE
PLEDGED
COLLATERAL.........................................................9
SECTION 3.03 REPRESENTATIONS,
WARRANTIES AND
COVENANTS..................................................9
SECTION 3.04 CERTIFICATION OF
LIMITED LIABILITY COMPANY INTERESTS AND LIMITED PARTNERSHIP
INTERESTS.................................................................................10
SECTION 3.05 REGISTRATION IN
NOMINEE NAME;
DENOMINATIONS...............................................11
SECTION 3.06 VOTING RIGHTS;
DIVIDENDS AND INTEREST,
ETC................................................11
ARTICLE IV
SECURITY INTERESTS IN PERSONAL PROPERTY
SECTION 4.01 SECURITY
INTEREST.........................................................................13
SECTION 4.02 REPRESENTATIONS AND
WARRANTIES............................................................15
SECTION 4.03
COVENANTS.................................................................................17
SECTION 4.04 OTHER
ACTIONS.............................................................................20
SECTION 4.05 COVENANTS REGARDING
PATENT, TRADEMARK AND COPYRIGHT
COLLATERAL............................22
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ARTICLE V
REMEDIES
SECTION 5.01 REMEDIES UPON
DEFAULT.....................................................................24
SECTION 5.02 APPLICATION OF
PROCEEDS...................................................................26
SECTION 5.03 GRANT OF LICENSE TO
USE INTELLECTUAL
PROPERTY.............................................26
SECTION 5.04 SECURITIES ACT,
ETC.......................................................................27
ARTICLE VI
INDEMNITY, SUBROGATION AND SUBORDINATION
SECTION 6.01 INDEMNITY AND
SUBROGATION.................................................................28
SECTION 6.02 CONTRIBUTION AND
SUBROGATION..............................................................28
SECTION 6.03
SUBORDINATION.............................................................................28
ARTICLE VII
MISCELLANEOUS
SECTION 7.01
NOTICES...................................................................................29
SECTION 7.02 SECURITY INTEREST
ABSOLUTE................................................................29
SECTION 7.03 SURVIVAL OF
AGREEMENT.....................................................................29
SECTION 7.04 BINDING EFFECT;
SEVERAL
AGREEMENT.........................................................29
SECTION 7.05 SUCCESSORS AND
ASSIGNS....................................................................30
SECTION 7.06 COLLATERAL AGENT'S
FEES AND EXPENSES;
INDEMNIFICATION.....................................30
SECTION 7.07 COLLATERAL AGENT
APPOINTED
ATTORNEY-IN-FACT...............................................31
SECTION 7.08 APPLICABLE
LAW............................................................................31
SECTION 7.09 WAIVERS;
AMENDMENT........................................................................32
SECTION 7.10 WAIVER OF JURY
TRIAL......................................................................32
SECTION 7.11
SEVERABILITY..............................................................................32
SECTION 7.12
COUNTERPARTS..............................................................................33
SECTION 7.13
HEADINGS..................................................................................33
SECTION 7.14 JURISDICTION; CONSENT
TO SERVICE OF
PROCESS...............................................33
SECTION 7.15 TERMINATION OR
RELEASE....................................................................33
SECTION 7.16 ADDITIONAL
SUBSIDIARIES...................................................................34
SECTION 7.17 RIGHT OF
SETOFF...........................................................................34
SECTION 7.18 SUBSIDIARY LOAN PARTY
ACKNOWLEDGMENT......................................................34
SECTION 7.19 INTERCREDITOR
AGREEMENT...................................................................34
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Schedules
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Schedule I Subsidiary
Guarantors
Schedule II Equity
Interests; Pledged Debt Securities
Schedule III Intellectual
Property
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Exhibits
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Exhibit A Form
of Supplement
Exhibit B Form
of Perfection Certificate
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FIRST LIEN GUARANTEE AND COLLATERAL
AGREEMENT dated as of August 24, 2007 (this
"AGREEMENT"), among PACIFIC ENERGY ALASKA
OPERATING LLC, a limited liability company
organized under the laws of the State of
Delaware (the "BORROWER"), PACIFIC ENERGY
ALASKA HOLDINGS, LLC, a limited liability
company organized under the laws of the
State of Delaware ("HOLDINGS"), the
Subsidiaries of the Borrower from time to
time party hereto and SILVER POINT FINANCE,
LLC ("SILVER POINT"), as collateral agent
for the Secured Parties (in such capacity,
the "COLLATERAL AGENT").
PRELIMINARY STATEMENT
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Reference is made to the First Lien Credit Agreement dated as
of August 24, 2007 (as amended, supplemented or otherwise modified
from time to
time, the "CREDIT AGREEMENT"), among the Borrower, Holdings, the
lenders from
time to time party thereto (the "LENDERS") and Silver Point, as
administrative
agent for the Lenders and collateral agent for the Secured Parties
(such term
and each other capitalized term used but not defined in this
preliminary
statement being defined as provided in Article I).
The Lenders have agreed to extend credit to the Borrower
pursuant to, and upon the terms and conditions specified in, the
Credit
Agreement. The obligations of the Lenders to extend credit to the
Borrower are
conditioned upon, among other things, the execution and delivery of
this
Agreement by the Borrower and each Guarantor. Each Guarantor is an
affiliate of
the Borrower, will derive substantial benefits from the extension
of credit to
the Borrower pursuant to the Credit Agreement and is willing to
execute and
deliver this Agreement in order to induce the Lenders to extend
such credit.
Accordingly, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 CREDIT AGREEMENT. (a) Each capitalized term used
but not defined herein shall have the meaning assigned to it in the
Credit
Agreement. Each capitalized term defined in the New York UCC (as
such term is
defined herein) and not defined in this Agreement shall have the
meaning
assigned to it in the New York UCC. All references to the Uniform
Commercial
Code shall mean the New York UCC.
(b) The rules of construction specified in Section 1.02 of the
Credit Agreement also apply to this Agreement.
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SECTION 1.02 OTHER DEFINED TERMS. As used in this Agreement,
the following terms have the meanings specified below:
"ACCOUNTS RECEIVABLE" shall mean all Accounts and all right,
title and interest in any returned goods, together with all rights,
titles,
securities and guarantees with respect thereto, including any
rights to stoppage
in transit, replevin, reclamation and resales, and all related
security
interests, liens and pledges, whether voluntary or involuntary, in
each case
whether now existing or owned or hereafter arising or acquired.
"AGREEMENT" shall have the meaning assigned to such term in
the introductory paragraph.
"ARTICLE 9 COLLATERAL" shall have the meaning assigned to such
term in Section 4.01.
"BORROWER" shall have the meaning assigned to such term in
introductory paragraph to this Agreement.
"CLAIMING PARTY" has the meaning assigned to such term in
Section 6.02.
"COLLATERAL" shall mean the Article 9 Collateral and the
Pledged Collateral.
"COLLATERAL AGENT" shall have the meaning assigned to such
term in the introductory paragraph to this Agreement.
"CONTRIBUTING PARTY" has the meaning assigned to such term in
Section 6.02.
"COPYRIGHT LICENSE" shall mean any written agreement, now or
hereafter in effect, granting any right to any third person under
any copyright
now or hereafter owned by any Grantor or that such Grantor
otherwise has the
right to license, or granting any right to any Grantor under any
copyright now
or hereafter owned by any third person, and all rights of such
Grantor under any
such agreement.
"COPYRIGHTS" shall mean all of the following now owned or
hereafter acquired by any Grantor: (a) all copyright rights in any
work subject
to the copyright laws of the United States or any other country,
whether as
author, assignee, transferee or otherwise and (b) all registrations
and
applications for registration of any such copyright in the United
States or any
other country, including registrations, recordings, supplemental
registrations
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and pending applications for registration in the United States
Copyright Office
(or any successor office or any similar office in any other
country), including
those listed on SCHEDULE III.
"CREDIT AGREEMENT" shall have the meaning assigned to such
term in the preliminary statement to this Agreement.
"FEDERAL SECURITIES LAWS" shall have the meaning assigned to
such term in Section 5.04.
"GENERAL INTANGIBLES" shall mean all choses in action and
causes of action and all other intangible personal property of
every kind and
nature (other than Accounts) and other general intangibles now
owned or
hereafter acquired by any Grantor, including all rights and
interests in
partnerships, limited partnerships, limited liability companies and
other
unincorporated entities, corporate or other business records,
indemnification
claims, contract rights (including rights under Oil and Gas
Properties, Leases,
other leases, Hedging Agreements, the Intercompany Services
Agreement, the Tax
Sharing Agreements, the Master Conveyance and other agreements),
Intellectual
Property, goodwill, registrations, franchises, tax refund claims
and any letter
of credit, guarantee, claim, security interest or other security
held by or
granted to any Grantor to secure payment by an Account Debtor of
any of the
Accounts.
"GRANTORS" shall mean Holdings, the Borrower and the
Subsidiary Loan Parties.
"GUARANTORS" shall mean Holdings and the Subsidiary Loan
Parties.
"HOLDINGS" shall have the meaning assigned to such term in the
introductory paragraph to this Agreement.
"INTELLECTUAL PROPERTY" shall mean all intellectual and
similar property of every kind and nature now owned or hereafter
acquired by any
Grantor, including inventions, designs, Patents, Copyrights,
Licenses,
Trademarks, trade secrets, confidential or proprietary technical
and business
information, know-how, show-how or other data or information,
software and
databases and all embodiments or fixations thereof and related
documentation,
registrations and franchises, and all additions, improvements and
accessions to,
and books and records describing or used in connection with, any of
the
foregoing.
"LENDERS" shall have the meaning assigned to such term in the
preliminary statements to this Agreement.
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"LICENSE" shall mean any Patent License, Trademark License,
Copyright License or other license or sublicense agreement relating
to
Intellectual Property to which any Grantor is a party, including
those listed on
Schedule III.
"NEW YORK UCC' shall mean the Uniform Commercial Code as from
time to time in effect in the State of New York.
"PATENT LICENSE" shall mean any written agreement, now or
hereafter in effect, granting to any third person any right to
make, use or sell
any invention on which a patent, now or hereafter owned by any
Grantor or that
any Grantor otherwise has the right to license, is in existence, or
granting to
any Grantor any right to make, use or sell any invention on which a
patent, now
or hereafter owned by any third person, is in existence, and all
rights of any
Grantor under any such agreement.
"PATENTS" shall mean all of the following now owned or
hereafter acquired by any Grantor: (a) all letters patent of the
United States
or the equivalent thereof in any other country, all registrations
and recordings
thereof, and all applications for letters patent of the United
States or the
equivalent thereof in any other country, including registrations,
recordings and
pending applications in the United States Patent and Trademark
Office (or any
successor or any similar offices in any other country), including
those listed
on Schedule III and (b) all reissues, continuations, divisions,
continuations-in-part, renewals or extensions thereof, and the
inventions
disclosed or claimed therein, including the right to make, use
and/or sell the
inventions disclosed or claimed therein.
"PERFECTION CERTIFICATE" shall mean a certificate
substantially in the form of Exhibit B, completed and supplemented
with the
schedules and attachments contemplated thereby.
"PLEDGED COLLATERAL" shall have the meaning assigned to such
term in Section 3.01.
"PLEDGED DEBT SECURITIES" shall have the meaning assigned to
such term in Section 3.01.
"PLEDGED EQUITY INTERESTS" shall have the meaning assigned to
such term in Section 3.01.
"PLEDGED SECURITIES" shall mean any promissory notes, unit
certificates, stock certificates or other securities (as defined in
Article 8 of
the New York UCC) now or hereafter included in the Pledged
Collateral, including
all certificates, instruments or other documents representing or
evidencing any
Pledged Collateral.
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"SECOND LIEN COLLATERAL AGENT" shall mean the "Collateral
Agent" as defined in the Second Lien Collateral Agreement.
"SECOND LIEN COLLATERAL AGREEMENT" shall mean the "Collateral
Agreement" as defined in the Second Lien Credit Agreement.
"SECOND LIEN CREDIT AGREEMENT" shall mean the Second Lien
Credit Agreement dated as of August 24, 2007, among the Borrower,
Holdings, the
lenders from time to time party thereto and Silver Point, as
administrative
agent and collateral agent thereunder.
"SECOND LIEN LOAN DOCUMENTS" shall mean the "Loan Documents"
as defined in the Second Lien Credit Agreement.
"SECOND LIEN SECURED PARTIES" shall mean the "Secured Parties"
as defined in the Second Lien Credit Agreement.
"SECURITY INTEREST" shall have the meaning assigned to such
term in Section 4.01.
"SILVER POINT" shall have the meaning assigned to such term in
introductory paragraph to this Agreement.
"SUBSIDIARY LOAN PARTIES" shall mean (a) the Subsidiaries
identified on Schedule I hereto as Subsidiary Loan Parties and (b)
each other
Subsidiary that becomes a party to this Agreement pursuant to
Section 7.16 after
the Closing Date.
"TRADEMARK LICENSE" shall mean any written agreement, now or
hereafter in effect, granting to any third person any right to use
any trademark
now or hereafter owned by any Grantor or that any Grantor otherwise
has the
right to license, or granting to any Grantor any right to use any
trademark now
or hereafter owned by any third person, and all rights of any
Grantor under any
such agreement.
"TRADEMARKS" shall mean all of the following now owned or
hereafter acquired by any Grantor: (a) all trademarks, service
marks, trade
names, corporate names, company names, business names, fictitious
business
names, trade styles, trade dress, logos, other source or business
identifiers,
designs and general intangibles of like nature, now existing or
hereafter
adopted or acquired, all registrations and recordings thereof, and
all
registration and recording applications filed in connection
therewith, including
registrations and registration applications in the United States
Patent and
Trademark Office (or any successor office) or any similar offices
in any State
of the United States or any other country or any political
subdivision thereof,
and all extensions or renewals thereof, including those listed on
Schedule III,
(b) all goodwill associated therewith or symbolized thereby and (c)
all other
assets, rights and interests that uniquely reflect or embody such
goodwill.
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"UNFUNDED ADVANCES/PARTICIPATIONS" shall mean the aggregate
amount, if any, made available to the Borrower on the assumption
that each
Lender has made its portion of the applicable Borrowing available
to the
Collateral Agent as contemplated by Section 2.02(d) of the Credit
Agreement and
with respect to which a corresponding amount shall not in fact have
been
returned to the Collateral Agent by the Borrower or made available
to the
Collateral Agent by the applicable Lender.
ARTICLE II
GUARANTEE
SECTION 2.01 GUARANTEE. Each Guarantor irrevocably and
unconditionally guarantees, jointly with the other Guarantors and
severally, as
a primary obligor and not merely as a surety, the due and punctual
payment and
performance of the Obligations. Each Guarantor further agrees that
the
Obligations may be extended or renewed, in whole or in part,
without notice to
or further assent from it, and that it will remain bound upon its
guarantee
hereunder notwithstanding any such extension or renewal of any
Obligation. Each
Guarantor waives presentment to, demand of payment from and protest
to the
Borrower or any other Loan Party of any Obligation, and also waives
notice of
acceptance of its guarantee and notice of protest for
nonpayment.
SECTION 2.02 GUARANTEE OF PAYMENT; CONTINUING GUARANTEE. Each
Guarantor further agrees that its guarantee hereunder constitutes a
guarantee of
payment when due (whether or not any bankruptcy or similar
proceeding shall have
stayed the accrual or collection of any of the Obligations or
operated as a
discharge thereof) and not of collection, and waives any right to
require that
any resort be had by the Collateral Agent or any other Secured
Party to any
security held for the payment of the Obligations or to any balance
of any
Deposit Account or credit on the books of the Collateral Agent or
any other
Secured Party in favor of the Borrower, any other Loan Party or any
other
person. Each Guarantor agrees that its guarantee hereunder is
continuing in
nature and applies to all Obligations, whether currently existing
or hereafter
incurred.
SECTION 2.03 NO LIMITATIONS, ETC. (a) Except for termination
of a Guarantor's obligations hereunder as expressly provided in
Section 7.15,
the obligations of each Guarantor hereunder shall not be subject to
any
reduction, limitation, impairment or termination for any reason,
including any
claim of waiver, release, surrender, alteration or compromise, and
shall not be
subject to any defense or setoff, counterclaim, recoupment or
termination
whatsoever by reason of the invalidity, illegality or
unenforceability of the
Obligations, any impossibility in the performance of the
Obligations or
otherwise. Without limiting the generality of the foregoing, the
obligations of
each Guarantor hereunder shall not be discharged, impaired or
otherwise affected
by (i) the failure of the Collateral Agent or any other Secured
Party to assert
any claim or demand or to enforce or exercise any right or remedy
under the
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provisions of any Loan Document or otherwise, (ii) any extension or
renewal of
any of the Obligations, (iii) any rescission, waiver, amendment or
modification
of, or any release from any of the terms or provisions of, any Loan
Document or
any other agreement, including with respect to any other Guarantor
under this
Agreement, (iv) the release of, or any impairment of or failure to
perfect any
Lien on or security interest in, any security held by the
Collateral Agent or
any other Secured Party for the Obligations or any of them, (v) any
default,
failure or delay, wilful or otherwise, in the performance of the
Obligations or
(vi) any other act, omission or delay to do any other act that may
or might in
any manner or to any extent vary the risk of any Guarantor or
otherwise operate
as a discharge of any Guarantor as a matter of law or equity (other
than the
indefeasible payment in full in cash of all the Obligations) or
which would
impair or eliminate the right of any Guarantor to subrogation. Each
Guarantor
expressly authorizes the Collateral Agent and the other Secured
Parties to take
and hold security for the payment and performance of the
Obligations, to
exchange, waive or release any or all such security (with or
without
consideration), to enforce or apply such security and direct the
order and
manner of any sale thereof in their sole discretion or to release
or substitute
any one or more other guarantors or obligors upon or in respect of
the
Obligations, all without affecting the obligations of any Guarantor
hereunder.
Each Guarantor acknowledges that it will receive substantial direct
and indirect
benefits from the financing arrangements contemplated by the Loan
Documents.
(b) To the fullest extent permitted by applicable law, each
Guarantor waives any defense based on or arising out of any defense
of
the Borrower or any other Loan Party or the unenforceability of
the
Obligations or any part thereof from any cause, or the cessation
from
any cause of the liability of the Borrower or any other Loan
Party,
other than the indefeasible payment in full in cash of all the
Obligations. The Collateral Agent and the other Secured Parties
may, at
their election, foreclose on any security held by one or more of
them
by one or more judicial or nonjudicial sales, accept an assignment
of
any such
security in lieu of foreclosure, compromise or adjust any part
of the Obligations, make any other accommodation with the Borrower
or
any other Loan Party or exercise any other right or remedy
available to
them against the Borrower or any other Loan Party, without
affecting or
impairing in any way the liability of any Guarantor hereunder
except to
the extent the Obligations have been fully and indefeasibly paid
in
full in cash. To the fullest extent permitted by applicable law,
each
Guarantor waives any defense arising out of any such election
even
though such election operates, pursuant to applicable law, to
impair or
to extinguish any right of reimbursement or subrogation or other
right
or remedy of such Guarantor against the Borrower or any other
Loan
Party, as the case may be, or any security.
SECTION 2.04 REINSTATEMENT. Each Guarantor agrees that its
guarantee hereunder shall continue to be effective or be
reinstated, as the case
may be, if at any time payment, or any part thereof, of any
Obligation is
rescinded or must otherwise be restored by the Collateral Agent or
any other
Secured Party upon the bankruptcy or reorganization of the
Borrower, any other
Loan Party or otherwise.
SECTION 2.05 AGREEMENT TO PAY; SUBROGATION. In furtherance of
the foregoing and not in limitation of any other right that the
Collateral Agent
or any other Secured Party has at law or in equity against any
Guarantor by
virtue hereof, upon the failure of the Borrower or any other Loan
Party to pay
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any Obligation when and as the same shall become due, whether at
maturity, by
acceleration, after notice of prepayment or otherwise, each
Guarantor hereby
promises to and will forthwith pay, or cause to be paid, to the
Collateral Agent
for distribution to the applicable Secured Parties in cash the
amount of such
unpaid Obligation. Upon payment by any Guarantor of any sums to the
Collateral
Agent as provided above, all rights of such Guarantor against the
Borrower or
any other Loan Party arising as a result thereof by way of right of
subrogation,
contribution, reimbursement, indemnity or otherwise shall in all
respects be
subject to Article VI. If any amount shall erroneously be paid to
any Guarantor
on account of any such Indebtedness of the Borrower or any other
Loan Party,
such amount shall be held in trust for the benefit of the Secured
Parties and
shall forthwith be paid to the Collateral Agent to be credited
against the
payment of the Obligations, whether matured or unmatured, in
accordance with the
terms of the Credit Agreement and any other Loan Document.
SECTION 2.06 INFORMATION. Each Guarantor assumes all
responsibility for being and keeping itself informed of the
Borrower's and each
other Loan Party's financial condition and assets and of all other
circumstances
bearing upon the risk of nonpayment of the Obligations and the
nature, scope and
extent of the risks that such Guarantor assumes and incurs
hereunder, and agrees
that neither the Collateral Agent nor any other Secured Party will
have any duty
to advise such Guarantor of information known to it or any of them
regarding
such circumstances or risks.
SECTION 2.07 TAXES. Each Guarantor agrees that the provisions
of Section 2.19 of the Credit Agreement shall apply equally to such
Guarantor
with respect to payments made by it hereunder.
ARTICLE III
PLEDGE OF SECURITIES
SECTION 3.01 PLEDGE. As security for the payment or
performance, as the case may be, in full of the Obligations, each
Grantor hereby
assigns and pledges to the Collateral Agent, its successors and
assigns, for the
ratable benefit of the Secured Parties, and hereby grants to the
Collateral
Agent, its successors and assigns, for the ratable benefit of the
Secured
Parties, a security interest in, all of such Grantor's right, title
and interest
in, to and under (a)(i) the Equity Interests owned by such Grantor
on the date
hereof (including all such Equity Interests listed on Schedule II),
(ii) any
other Equity Interests obtained in the future by such Grantor and
(iii) all
certificates, if any, representing any such Equity Interests (all
the foregoing
collectively referred to herein as the "PLEDGED EQUITY INTERESTS"),
(b)(i) the
debt securities held by such Grantor on the date hereof (including
all such debt
securities listed opposite the name of such Grantor on Schedule
II), (ii) any
debt securities obtained in the future by such Grantor and (iii)
all promissory
notes and other instruments evidencing any such debt securities
(all the
foregoing collectively referred to herein as the "PLEDGED DEBT
SECURITIES"), (c)
all other property that may be delivered to and held by the
Collateral Agent
pursuant to the terms of this Section 3.01, (d) subject to Section
3.06, all
payments of principal or interest, dividends, cash, instruments and
other
property from time to time received, receivable or otherwise
distributed in
respect of, in exchange for or upon the conversion of, and all
other Proceeds
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received in respect of, the securities referred to in clauses (a)
and (b) above,
(e) subject to Section 3.06, all rights and privileges of such
Grantor with
respect to the securities and other property referred to in clauses
(a), (b),
(c) and (d) above, and (f) all Proceeds of any of the foregoing
(the items
referred to in clauses (a) through (f) above being collectively
referred to as
the "PLEDGED COLLATERAL").
TO HAVE AND TO HOLD the Pledged Collateral, together with all
right, title, interest, powers, privileges and preferences
pertaining or
incidental thereto, unto the Collateral Agent, its successors and
assigns, for
the ratable benefit of the Secured Parties, forever; subject,
however, to the
terms, covenants and conditions hereinafter set forth.
SECTION 3.02 DELIVERY OF THE PLEDGED COLLATERAL. (a) To the
extent required in order for the Collateral and Guarantee
Requirement to remain
satisfied at all times, each Grantor agrees promptly to deliver or
cause to be
delivered to the Collateral Agent any and all certificates,
instruments or other
documents representing or evidencing Pledged Securities.
(b) Upon delivery to the Collateral Agent, (i) any
certificate, instrument or document representing or evidencing
Pledged
Securities constituting a "security" shall be accompanied by
undated
stock or unit powers duly executed in blank or other undated
instruments of transfer satisfactory to the Collateral Agent and
duly
executed in blank and by such other instruments and documents as
the
Collateral Agent may reasonably request and (ii) all other
property
composing part of the Pledged Collateral shall be accompanied by
proper
instruments of assignment duly executed by the applicable Grantor
and
such other instruments or documents as the Collateral Agent may
reasonably request. Each delivery of Pledged Securities shall
be
accompanied by a schedule describing the applicable securities,
which
schedule shall be attached hereto as SCHEDULE II and made a
part
hereof; PROVIDED that failure to attach any such schedule hereto
shall
not affect the validity of the pledge of such Pledged Securities.
Each
schedule so delivered shall supplement any prior schedules so
delivered.
SECTION 3.03 REPRESENTATIONS, WARRANTIES AND COVENANTS. Each
Grantor, jointly with the other Grantors and severally, represents
and warrants,
as of the Effective Date, that, and covenants to and with the
Collateral Agent,
for the benefit of the Secured Parties, that:
(a) Schedule II correctly sets forth the percentage of the
issued and outstanding units of each class of the Equity Interests
of
the issuer thereof represented by such Pledged Equity Interests
and
includes all Equity Interests, debt securities and promissory
notes
required to be pledged hereunder in order to satisfy the Collateral
and
Guarantee Requirement;
(b) the Pledged Equity Interests and Pledged Debt Securities
have been duly and validly authorized and issued by the issuers
thereof
and (i) in the case of Pledged Equity Interests, are fully paid
and
(ii) in the case of Pledged Debt Securities, are legal, valid
and
binding obligations of the issuers thereof;
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(c) except for the security interests granted hereunder (or
otherwise permitted under the Credit Agreement), each Grantor (i)
is
and, subject to any transfers made in compliance with the
Credit
Agreement, will continue to be the direct owner, beneficially and
of
record, of the Pledged Securities indicated on Schedule II as owned
by
such Grantor, (ii) holds the same free and clear of all Liens and
(iii)
will make no assignment, pledge, hypothecation or transfer of,
or
create or permit to exist any security interest in or other Lien
on,
the Pledged Collateral, other than transfers made in compliance
with
the Credit Agreement;
(d) except for restrictions and limitations imposed by the
Loan Documents, the Second Lien Loan Documents or securities
laws
generally, the Pledged Collateral is and will continue to be
freely
transferable and assignable, and none of the Pledged Collateral is
or
will be subject to any option, right of first refusal,
shareholders
agreement, charter or by-law provisions or contractual restriction
of
any nature that might prohibit, impair, delay or otherwise affect
the
pledge of such Pledged Collateral hereunder, the sale or
disposition
thereof pursuant hereto or the exercise by the Collateral Agent
of
rights and remedies hereunder;
(e) each Grantor (i) has the power and authority to pledge the
Pledged Collateral pledged by it hereunder in the manner hereby
done or
contemplated and (ii) will defend its title or interest thereto
or
therein against any and all Liens (other than any Lien created
or
permitted by the Loan Documents), however arising, of all
persons
whomsoever;
(f) no consent or approval of any Governmental Authority, any
securities exchange or any other person was or is necessary to
the
validity of the pledge effected hereby (other than such as have
been
obtained and are in
full force and effect);
(g) by virtue of the execution and delivery by each Grantor of
this Agreement, when any Pledged Securities are delivered to
the
Collateral Agent in accordance with this Agreement, the
Collateral
Agent will obtain a legal, valid and perfected first priority lien
upon
and security interest in such Pledged Securities as security for
the
payment and performance of the Obligations; and
(h) the pledge effected hereby is effective to vest in the
Collateral Agent, for the ratable benefit of the Secured Parties,
the
rights of the Collateral Agent in the Pledged Collateral as set
forth
herein and all action by any Grantor necessary or desirable to
protect
and perfect the Lien on the Pledged Collateral has been duly
taken.
SECTION 3.04 CERTIFICATION OF LIMITED LIABILITY COMPANY
INTERESTS AND LIMITED PARTNERSHIP INTERESTS. As of the Effective
Date, each
interest in the Borrower or any limited liability company or
limited partnership
which is a Subsidiary is represented by a certificate and is a
"security" within
the meaning of Article 8 of the New York UCC or governed by Article
8 of the New
York UCC and such certificates have been delivered to the
Collateral Agent.
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SECTION 3.05 REGISTRATION IN NOMINEE NAME; DENOMINATIONS. The
Collateral Agent, on behalf of the Secured Parties, shall have the
right (in its
sole and absolute discretion) to hold the Pledged Securities in its
own name as
pledgee, the name of its nominee (as pledgee or as sub-agent) or
the name of the
applicable Grantor, endorsed or assigned in blank or in favor of
the Collateral
Agent. Each Grantor will promptly give to the Collateral Agent
copies of any
notices or other communications received by it with respect to
Pledged
Securities in its capacity as the registered owner thereof. The
Collateral Agent
shall at all times have the right to exchange the certificates
representing
Pledged Securities for certificates of smaller or larger
denominations for any
purpose consistent with this Agreement.
SECTION 3.06 VOTING RIGHTS; DIVIDENDS AND INTEREST, ETC. (a)
Unless and until an Event of Default shall have occurred and be
continuing and,
subject to the terms of the Intercreditor Agreement and applicable
law, the
Collateral Agent shall have given the Grantors notice of its intent
to exercise
its rights under this Agreement (which notice shall be deemed to
have been given
immediately upon the occurrence of an Event of Default under
paragraph (g) or
(h) of Article VII of the Credit Agreement):
(i) Each Grantor shall be entitled to exercise any
and all voting and/or other consensual rights and powers
inuring to an owner of Pledged Securities or any part thereof
for any purpose consistent with the terms of this Agreement,
the Credit Agreement and the other Loan Documents; PROVIDED,
HOWEVER, that such rights and powers shall not be exercised in
any manner that could materially and adversely affect the
rights inuring to a holder of any Pledged Securities or the
rights and remedies of the Collateral Agent or the other
Secured Parties under this Agreement or the Credit Agreement
or any other Loan Document or the ability of the Secured
Parties to exercise the same.
(ii) The Collateral Agent shall execute and deliver
to each Grantor, or cause to be executed and delivered to each
Grantor, all such proxies, powers of attorney and other
instruments as such Grantor may reasonably request for the
purpose of enabling such Grantor to exercise the voting and/or
consensual rights and powers it is entitled to exercise
pursuant to subparagraph (i) above.
(iii) Each Grantor shall be entitled to receive and
retain any and all dividends, interest, principal and other
distributions paid on or distributed in respect of the Pledged
Securities to the extent and only to the extent that such
dividends, interest, principal and other distributions are
permitted by, and otherwise paid or distributed in accordance
with, the terms and conditions of the Credit Agreement, the
other Loan Documents and applicable law; PROVIDED, HOWEVER,
that any noncash dividends, interest, principal or other
distributions that would constitute Pledged Equity Interests
or Pledged Debt Securities, whether resulting from a
subdivision, combination or reclassification of the
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outstanding Equity Interests in the issuer of any Pledged
Securities or received in exchange for Pledged Securities or
any part thereof, or in redemption thereof, or as a result of
any merger, consolidation, acquisition or other exchange of
assets to which such issuer may be a party or otherwise, shall
be and become part of the Pledged Collateral, and, if received
by any Grantor, shall not be commingled by such Grantor with
any of its other funds or property but shall be held separate
and apart therefrom, shall be held in trust for the ratable
benefit of the Secured Parties and shall be forthwith
delivered to the Collateral Agent in the same form as so
received (with any necessary endorsement or instrument of
assignment).
(b) Subject to the terms of the Intercreditor Agreement, upon
the occurrence and during the continuance of an Event of Default,
after
the Collateral Agent shall have notified (or shall be deemed to
have
notified pursuant to Section 3.06(a)) the Grantors of the
suspension of
their rights under paragraph (a)(iii) of this Section 3.06, then
all
rights of any Grantor to dividends, interest, principal or
other
distributions that such Grantor is authorized to receive pursuant
to
paragraph (a)(iii) of this Section 3.06 shall cease, and all
such
rights shall thereupon become vested in the Collateral Agent, for
the
ratable benefit of the Secured Parties, and in the Second Lien
Collateral Agent, for the ratable benefit of the Second Lien
Secured
Parties. The Collateral Agent shall have the sole and exclusive
right
and authority to receive and retain such dividends, interest,
principal
or other distributions. All dividends, interest, principal or
other
distributions received by any Grantor contrary to the provisions
of
this Section 3.06 shall be held in trust for the benefit of the
Collateral Agent, for the ratable benefit of the Secured Parties,
and
the Second Lien Collateral Agent, for the ratable benefit of the
Second
Lien Secured Parties, shall be segregated from other property or
funds
of such Grantor and shall be forthwith delivered to the
Collateral
Agent upon demand in the same form as so received (with any
necessary
endorsement or instrument of assignment). Any and all money and
other
property paid over to or received by the Collateral Agent pursuant
to
the provisions of this paragraph (b) shall be retained by the
Collateral Agent in an account to be established by the
Collateral
Agent upon receipt of such money or other property and shall be
applied
in accordance with the provisions of Section 5.02. After all Events
of
Default have been cured or waived and each applicable Grantor
has
delivered to the Collateral Agent certificates to that effect,
the
Collateral Agent shall, promptly after all such Events of Default
have
been cured or waived, repay to each applicable Grantor (without
interest) all dividends, interest, principal or other
distributions
that such Grantor would otherwise be permitted to retain pursuant
to
the terms of paragraph (a)(iii) of this Section 3.06 and that
remain in
such account.
(c) Subject to the terms of the Intercreditor Agreement, upon
the occurrence and during the continuance of an Event of Default,
after
the Collateral Agent shall have notified (or shall be deemed to
have
notified pursuant to Section 3.06(a)) the Grantors of the
suspension of
their rights under paragraph (a)(i) of this Section 3.06, then
all
rights of any Grantor to exercise the voting and consensual rights
and
powers it is entitled to exercise pursuant to paragraph (a)(i) of
this
Section 3.06, and the obligations of the Collateral Agent under
paragraph (a)(ii) of this Section 3.06, shall cease, and all
such
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rights shall thereupon become vested in the Collateral Agent, for
the
ratable benefit of the Secured Parties, and in the Second Lien
Collateral Agent, for the ratable benefit of the Second Lien
Secured
Parties. The Collateral Agent shall have the sole and exclusive
right
and authority to exercise such voting and consensual rights and
powers;
PROVIDED that, unless otherwise directed by the Required Lenders,
the
Collateral Agent shall have the right from time to time following
and
during the continuance of an Event of Default to permit the
Grantors to
exercise such rights.
(d) Any notice given by the Collateral Agent to the Grantors
exercising its rights under paragraph (a) of this Section 3.06 (i)
may
be given by telephone if promptly confirmed in writing, (ii) may
be
given to one or more of the Grantors at the same or different times
and
(iii) may suspend the rights of the Grantors under paragraph (a)(i)
or
paragraph (a)(iii) in part without suspending all such rights
(as
specified by the Collateral Agent in its sole and absolute
discretion)
and without waiving or otherwise affecting the Collateral
Agent's
rights to give additional notices from time to time suspending
other
rights so long as an Event of Default has occurred and is
continuing.
ARTICLE IV
SECURITY INTERESTS IN PERSONAL PROPERTY
SECTION 4.01 SECURITY INTEREST. (a) As security for the
payment or performance, as the case may be, in full of the
Obligations, each
Grantor hereby assigns and pledges to the Collateral Agent, its
successors and
assigns, for the ratable benefit of the Secured Parties, and hereby
grants to
the Collateral Agent, its successors and assigns, for the ratable
benefit of the
Secured Parties, a security interest (the "SECURITY INTEREST"), in
all right,
title or interest in or to any and all of the following assets and
properties
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 (collectively, the "ARTICLE 9 COLLATERAL"):
(i) all Accounts;
(ii) all As-Extracted Collateral;
(iii) all Chattel Paper;
(iv) all cash and Deposit Accounts;
(v) all Documents;
(vi) all Equipment;
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(vii) all Fixtures;
(viii) all General Intangibles;
(ix) all Instruments;
(x) all Inventory;
(xi) all Investment Property;
(xii) all Letter-of-Credit Rights;
(xiii) all Commercial Tort Claims;
(xiv) all Securities Accounts;
(xv) all books and records pertaining to the Article 9
Collateral; and
(xvi) 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.
(b) Each Grantor hereby irrevocably authorizes the Collateral
Agent at any time and from time to time to file in any relevant
jurisdiction any
initial financing statements (including fixture
filings) with respect to the Article 9 Collateral or any part
thereof
and amendments thereto that (i) indicate the Article 9 Collateral
as
"all assets" of such Grantor or words of similar effect and
(ii)
contain the information required by Article 9 of the Uniform
Commercial
Code of each applicable jurisdiction for the filing of any
financing
statement or amendment, including whether such Grantor is an
organization, the type of organization and any organizational
identification number issued to such Grantor. Each Grantor agrees
to
provide such information to the Collateral Agent promptly upon
request.
Each Grantor also ratifies its authorization for the
Collateral Agent to file in any relevant jurisdiction any
initial
financing statements or amendments thereto if filed prior to
the
Closing Date.
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The Collateral Agent is further authorized to file with the
United States Patent and Trademark Office or United States
Copyright
Office (or any successor office or any similar office in any
other
country) such documents as may be necessary or advisable for
the
purpose of perfecting, confirming, continuing, enforcing or
protecting
the Security Interest granted by each Grantor, without the
signature of
such Grantor, and naming such Grantor or the Grantors as debtors
and
the Collateral Agent as secured party.
(c) The Security Interest is granted as security only and
shall not subject the Collateral Agent or any other Secured Party
to,
or in any way alter or modify, any obligation or liability of
any
Grantor with respect to or arising out of the Article 9
Collateral.
(d) Notwithstanding anything herein to the contrary, in no
event shall the Security Interest attach to (A) any contract or
agreement (other than any Lease or other contract or agreement
relating
to a Hydrocarbon Interest) to which any Grantor is a party or any
of
its rights or interests thereunder to the extent and for so long as
the
grant of the Security Interest shall constitute or result in (I)
the
unenforceability of any right of such Grantor therein or (II) a
breach
or termination pursuant to the terms of, or a default under, any
such
contract or agreement (other than to the extent t
