Exhibit 99.2
EXECUTION COPY
====================================================
====================================================
GUARANTEE AND COLLATERAL AGREEMENT
dated as of December 19, 2006
among
VOLT DELTA RESOURCES, LLC
and
THE OTHER GRANTORS PARTY HERETO FROM TIME TO TIME,
as Grantors,
and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Administrative Agent
====================================================
====================================================
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
-----------------
<S>
<C>
Section 1
Definitions...................................................................2
Section 2
Guarantee.....................................................................2
2.1
Guarantee.....................................................................2
2.2
Right of
Contribution.........................................................2
2.3
No
Subrogation................................................................2
2.4
Amendments, etc. with respect to the Secured
Obligations......................2
2.5
Guarantee Absolute and
Unconditional..........................................2
2.6
Payments......................................................................2
Section 3
Grant of Security
Interest....................................................2
Section 4
Representations and
Warranties................................................2
4.1
Title; No Other
Liens.........................................................2
4.2
Perfected First Priority
Liens................................................2
4.3
Grantor
Information...........................................................2
4.4
Collateral
Locations..........................................................2
4.5
Certain
Property..............................................................2
4.6
Investment
Property...........................................................2
4.7
Receivables...................................................................2
4.8
Intellectual
Property.........................................................2
4.9
Depositary and Other
Accounts.................................................2
4.10
Holdings
4.11
Excluded
Property.............................................................2
4.12
Credit
Agreement..............................................................2
Section 5
Covenants.....................................................................2
5.1
Delivery of Instruments, Certificated Securities and Chattel
Paper............2
5.2
Maintenance of Perfected Security Interest; Further
Documentation.............2
5.3
Changes in Locations, Name,
etc...............................................2
5.4
Notices.......................................................................2
5.5
Investment
Property...........................................................2
5.6
Receivables...................................................................2
5.7
Intellectual
Property.........................................................2
5.8
Seller
Undertakings............................................................
5.9
Depositary and Other Deposit
Accounts.........................................2
5.10
Other
Matters.................................................................2
5.11
Holdings Covenant
5.12
Commercial Tort
Claims........................................................2
5.13
Credit
Agreement...............................................................
Section 6
Remedial
Provisions...........................................................2
6.1
Certain Matters Relating to
Receivables.......................................2
6.2
Communications with Obligors; Grantors Remain
Liable..........................2
</TABLE>
<PAGE>
<TABLE>
<S>
<C>
6.3
Investment
Property...........................................................2
6.4
Proceeds to be Turned Over To Administrative
Agent............................2
6.5
Application of
Proceeds.......................................................2
6.6
Code and Other
Remedies.......................................................2
6.7
Registration
Rights...........................................................2
6.8
Waiver;
Deficiency............................................................2
Section 7
Administrative
Agent..........................................................2
7.1
Administrative Agent's Appointment as Attorney-in-Fact,
etc...................2
7.2
Duty of Administrative
Agent..................................................2
7.3
Photocopy of this
Agreement...................................................2
7.4
Authority of Administrative
Agent.............................................2
Section 8
Miscellaneous.................................................................2
8.1
Amendments in
Writing.........................................................2
8.2
Notices.......................................................................2
8.3
Indemnification by
Grantors...................................................2
8.4
Enforcement
Expenses..........................................................2
8.5
Captions......................................................................2
8.6
Nature of
Remedies............................................................2
8.7
Counterparts..................................................................2
8.8
Severability..................................................................2
8.9
Entire
Agreement..............................................................2
8.10
Successors;
Assigns...........................................................2
8.11
Governing
Law.................................................................2
8.12
Forum Selection; Consent to
Jurisdiction......................................2
8.13
Waiver of Jury
Trial..........................................................2
8.14
Set-off.......................................................................2
8.15
Acknowledgements..............................................................2
8.16
Additional
Grantors...........................................................2
8.17
Releases......................................................................2
8.18
Obligations and Liens Absolute and
Unconditional..............................2
8.19
Reinstatement.................................................................2
</TABLE>
Schedules and Annex
-------------------
Schedule 1
Investment
Property
Schedule 2
Filings and Perfection
Schedule 3
Grantor Information
Schedule 4
Collateral Locations; Collateral in Possession
of Lessor, Bailee, Consignee or Warehouseman
Schedule 5
Intellectual Property
Schedule 6
Depositary and Other Deposit Accounts
Schedule 7
Commercial Tort Claims
Annex I Form of
Joinder to Guarantee and Collateral Agreement
<PAGE>
GUARANTEE AND COLLATERAL AGREEMENT
Guarantee and Collateral Agreement, dated as of December 19, 2006
(this
"Agreement"), made by each grantor signatory hereto (together with
any other
Person that becomes a party hereto as a grantor as provided herein,
"Grantors"),
in favor of Wells Fargo Bank, National Association, as
Administrative Agent for
all Lenders party to the Credit Agreement (as hereafter
defined).
Lenders have severally agreed to extend credit to Company pursuant
to the
Credit Agreement. Company is affiliated with each other Grantor.
Company and the
other Grantors are engaged in interrelated businesses, and each
Grantor will
derive substantial direct and indirect benefit from extensions of
credit under
the Credit Agreement. It is a condition precedent to each Lender's
obligation to
extend credit under the Credit Agreement that Grantors shall have
executed and
delivered this Agreement to Administrative Agent for the ratable
benefit of all
Lenders.
In
consideration of the premises and to induce Administrative Agent
and
Lenders to enter into the Credit Agreement and to induce Lenders to
extend
credit thereunder, each Grantor hereby agrees with Administrative
Agent, for the
ratable benefit of Lenders, as follows:
Section 1
Definitions.
-----------
1.1
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 terms of Section 1.3C of the Credit Agreement shall be
incorporated by
reference herein), and the following terms are used herein as
defined in Section
9-102 of the UCC: Accounts, Certificated Security, Chattel Paper,
Commercial
Tort Claims, Deposit Accounts, Documents, Electronic Chattel Paper,
Equipment,
Farm Products, Fixtures, Goods, Health-Care-Insurance Receivables,
Instruments,
Inventory, Letter-of-Credit Rights and Supporting Obligations.
1.2
When used herein the following terms shall have the following
meanings:
Agreement has the meaning set forth in the preamble hereto.
Collateral means (a) all of the personal property now owned or at
any time
hereafter acquired by any Grantor or in which any Grantor now has
or at any time
in the future may acquire any right, title or interest, including
all of each
Grantor's Accounts, Chattel Paper (including Electronic Chattel
Paper), Deposit
Accounts, Documents, Equipment, Farm Products, Fixtures, General
Intangibles,
Goods, Health-Care-Insurance Receivables, Instruments, Intellectual
Property,
Inventory, Investment Property, Letter-of-Credit Rights, Supporting
Obligations
and Identified Claims, (b) all books and records pertaining to any
of the
foregoing, (c) all Proceeds and products of any of the foregoing
and (d) all
collateral security given by any Person with respect to any of the
foregoing;
provided, that "Collateral" shall not include any Excluded
Property; provided,
further, that "Collateral" shall also not include any equity
interest in any
Person other than an Issuer listed on Part A of Schedule 1 as
amended from time
to time and, except as required by the Credit Agreement, shall not
include more
than 65% of the total outstanding equity interests of any Foreign
Subsidiary.
Where the context requires, terms relating to the Collateral or any
part
thereof, when used in relation to a Grantor, shall refer to such
Grantor's
Collateral or the relevant part thereof.
-1-
<PAGE>
Company Obligations means all Obligations of Company.
Copyrights means all copyrights arising under the laws of the
United
States, any other country or any political subdivision thereof,
whether
registered or unregistered and whether published or unpublished,
including those
listed on Schedule 5, all registrations and recordings thereof, and
all
applications in connection therewith, including all registrations,
recordings
and applications in the United States Copyright Office, and the
right to obtain
all renewals of any of the foregoing.
Copyright Licenses means all written agreements naming any Grantor
as
licensor or licensee, including those listed on Schedule 5,
granting any right
under any Copyright, including the grant of rights to manufacture,
distribute,
exploit and sell materials derived from any Copyright.
Credit Agreement means the Credit Agreement dated as of even date
herewith
among Company, Lenders and Administrative Agent, as amended,
supplemented,
restated or otherwise modified from time to time.
Excluded Property means, with respect to a Grantor, any Excluded
Property
(Customer Deposits), any Excluded Property (IP), and any Excluded
Property
(Other).
Excluded Property (Customer Deposits) means, with respect to a
Grantor, any
security deposit or other advance of monies pursuant to an
agreement, to the
extent held in a segregated account in the name of such Grantor or
customer of
such Grantor or an escrow agent.
Excluded Property (IP) means, with respect to a Grantor, any direct
or
indirect interest of any nature whatsoever, whether as owner,
licensor, licensee
or otherwise, and whether constituting a General Intangible or
otherwise, in any
Intellectual Property; provided, however, that as to any Copyright,
Patent or
Trademark (other than an "intent-to-use" Trademark, until such time
as such
Grantor begins to use such Trademark) owned (rather than licensed)
by such
Grantor, the exclusion shall not include such ownership interest
but the
security interest or other lien granted hereunder thereon shall in
all cases be
subject and subordinate to any and all licenses and other rights of
use, whether
exclusive or nonexclusive: (x) heretofore granted by Grantor (or
any Affiliate),
or any predecessor in interest, to any Person; or (y) hereafter
granted by such
Grantor (or any Affiliate) to any Person to the extent permitted or
not
prohibited by the Credit Agreement. In the case of any agreement
with any
customer, distributor or other Person that includes, but is not
limited to, the
grant of any license, sublicense or other right of use, the entire
agreement
(rather than only the portion directly pertaining to the applicable
Intellectual
Property) shall constitute "Excluded Property (IP)" to the extent
such agreement
contains a contractual nonassignability clause (whether or not such
restriction
is rendered unenforceable by Section 9-406 et seq. of the UCC).
Without limiting
the generality of the foregoing, all assets referenced in clause
(xii) of the
definition of "Permitted Encumbrances" in the Credit Agreement
shall constitute
"Excluded Property (IP)" for all purposes.
-2-
<PAGE>
Excluded Property (Other) means, with respect to a Grantor, any
item of
General Intangibles (other than Excluded Property (IP)) that is now
or hereafter
held by such Grantor but only to the extent that such item of
General
Intangibles (or any agreement evidencing such item of General
Intangibles)
contains a term or is subject to a rule of law, statute or
regulation that
restricts, prohibits, or requires a consent (that has not been
obtained) of a
Person (other than such Grantor) to, the creation, attachment or
perfection of
the security interest granted herein, and any such restriction,
prohibition
and/or requirement of consent is effective and enforceable under
applicable law
and is not rendered ineffective by applicable law (including
pursuant to
Sections 9-406, 9-407, 9-408 or 9-409 of the UCC); provided,
however, that (x)
"Excluded Property (Other)" shall not include any Proceeds of any
item of
General Intangibles, and (y) any item of General Intangibles that
at any time
ceases to satisfy the criteria for "Excluded Property (Other)"
(whether as a
result of the applicable Grantor obtaining any necessary consent,
any change in
any rule of law, statute or regulation, or otherwise), shall no
longer be
Excluded Property.
General Intangibles means all "general intangibles" as such term is
defined
in Section 9-102 of the UCC and, in any event, including with
respect to any
Grantor, all contracts, agreements, instruments and indentures in
any form, and
portions thereof, to which such Grantor is a party or under which
such Grantor
has any right, title or interest or to which such Grantor or any
property of
such Grantor is subject, as the same from time to time may be
amended,
supplemented or otherwise modified, including, without limitation,
(a) all
rights of such Grantor to receive moneys due and to become due to
it thereunder
or in connection therewith, (b) all rights of such Grantor to
damages arising
thereunder and (c) all rights of such Grantor to perform and to
exercise all
remedies thereunder.
Guarantor Obligations means, collectively, with respect to each
Guarantor,
all of such Guarantor's Obligations.
Guarantors means the collective reference to each Grantor other
than
Company.
Identified Claims means the Commercial Tort Claims described on
Schedule 7
as such schedule may be supplemented from time to time.
Intellectual Property means the collective reference to all
rights,
priorities and privileges relating to intellectual property,
whether arising
under United States, multinational or foreign laws or otherwise,
including the
Copyrights, the Copyright Licenses, the Patents, the Patent
Licenses, the
Trademarks and the Trademark Licenses, and all rights to sue at law
or in equity
for any infringement or other impairment thereof, including the
right to receive
all proceeds and damages therefrom.
Intercompany Note means any promissory note evidencing loans made
by (i)
any Grantor to any other Grantor or (ii) any Grantor to any other
direct or
indirect subsidiary of Company (whether or not such subsidiary is a
Grantor).
Investment Property means the collective reference to (a) all
"investment
property" as such term is defined in Section 9-102 of the UCC, (b)
all
"financial assets" as such term is defined in Section 8-102(a)(9)
of the UCC,
and (c) whether or not constituting "investment property" as so
defined, all
Pledged Notes and all Pledged Equity.
-3-
<PAGE>
Issuers means the collective reference to each issuer of any
Investment
Property included as Collateral.
Paid
in Full means (a) the payment in full in cash and performance of
all
Secured Obligations, (b) the termination of all Commitments and (c)
either (i)
the cancellation and return to Administrative Agent of all Letters
of Credit or
(ii) the cash collateralization of all Letters of Credit in
accordance with the
Credit Agreement.
Patents means (a) all letters patent of the United States, any
other
country or any political subdivision thereof, all reissues and
extensions
thereof and all goodwill associated therewith, including any of the
foregoing
referred to in Schedule 5, (b) all applications for letters patent
of the United
States or any other country and all divisions, continuations
and
continuations-in-part thereof, including any of the foregoing
referred to in
Schedule 5, and (c) all rights to obtain any reissues or extensions
of the
foregoing.
Patent Licenses means all agreements, whether written or oral,
providing
for the grant by or to any Grantor of any right to manufacture, use
or sell any
invention covered in whole or in part by a Patent, including any of
the
foregoing referred to in Schedule 5.
Permitted Liens has the meaning set forth in Section 4.1.
Pledged Equity means the equity interests listed on Part A of
Schedule 1
issued by the Issuers referenced thereon, together with any other
equity
interests, certificates, options or rights of any nature whatsoever
in respect
of the equity interests of any such Issuer that may be issued or
granted to, or
held by, any Grantor while this Agreement is in effect, whether in
the form of
Investment Property or a General Intangible.
Pledged Notes means all promissory notes listed on Schedule 1,
all
Intercompany Notes at any time issued to any Grantor and all other
promissory
notes issued to or held by any Grantor (other than (a) promissory
notes issued
in connection with extensions of trade credit by any Grantor in the
ordinary
course of business and (b) any individual promissory note which is
less than
$500,000 in principal amount, up to an aggregate of $1,000,000 for
all such
promissory notes excluded under this clause (b)).
Proceeds means all "proceeds" as such term is defined in Section
9-102 of
the UCC and, in any event, shall include all dividends or other
income from the
Investment Property, collections thereon or distributions or
payments with
respect thereto.
Receivable means any right to payment for goods sold or leased or
for
services rendered, whether or not such right is evidenced by an
Instrument or
Chattel Paper and whether or not it has been earned by performance
(including
any Accounts).
Secured Obligations means, collectively, Company Obligations and
Guarantor
Obligations.
Securities Act means the Securities Act of 1933, as amended.
Trademarks means (a) all
trademarks, trade names, corporate names, company
names, business names, fictitious business names, trade styles,
service marks,
logos and other source or business identifiers, and all goodwill
associated
therewith, now existing or hereafter adopted or acquired, all
registrations and
recordings thereof, and all applications in connection therewith,
whether in the
United States Patent and Trademark Office or in any similar office
or agency of
the United States, any State thereof or any other country or any
political
subdivision thereof, or otherwise, and all common-law rights
related thereto,
including any of the foregoing referred to in Schedule 5, and (b)
the right to
obtain all renewals thereof.
-4-
<PAGE>
Trademark Licenses means, collectively, each agreement, whether
written or
oral, providing for the grant by or to any Grantor of any right to
use any
Trademark, including any of the foregoing referred to in Schedule
5.
UCC
means the Uniform Commercial Code as in effect on the date hereof
and
from time to time in the State of New York, provided that if by
reason of
mandatory provisions of law, the perfection or the effect of
perfection or
non-perfection of the security interests in any Collateral or the
availability
of any remedy hereunder is governed by the Uniform Commercial Code
as in effect
on or after the date hereof in any other jurisdiction, "UCC" means
the Uniform
Commercial Code as in effect in such other jurisdiction for
purposes of the
provisions hereof relating to such perfection or effect of
perfection or
non-perfection or availability of such remedy.
1.3
Credit Agreement Controls. Notwithstanding anything in this
Agreement
to the contrary, in the event any term of this Agreement conflicts
or is
inconsistent with the terms and provisions of the Credit Agreement,
the terms
and provisions of the Credit Agreement shall control.
1.4
Excluded Property. For avoidance of doubt, the exclusion of any
asset
or property as Collateral hereunder by virtue of the definition of
"Excluded
Property" or Section 1.3 hereof shall apply whether or not such
excluded asset
or property is expressly excluded from any otherwise applicable
representation,
warranty, covenant, default or remedy contained in this
Agreement.
Section 2
Guarantee.
---------
2.1
Guarantee.
(a)
Each of the Guarantors hereby, jointly and severally,
unconditionally
and irrevocably, as a primary obligor and not only a surety,
guarantees to
Administrative Agent, for the ratable benefit of Lenders and their
respective
successors, indorsees, transferees and assigns, the prompt and
complete payment
and performance by Company when due (whether at the stated
maturity, by
acceleration or otherwise) of Company Obligations.
(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 which can
be guaranteed
by such Guarantor under applicable federal and state laws relating
to the
insolvency of debtors (after giving effect to the right of
contribution
established in Section 2.2).
-5-
<PAGE>
(c)
Each Guarantor agrees that the Secured Obligations 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 Administrative Agent or any Lender
hereunder.
(d)
The guarantee contained in this Section 2 shall remain in full
force
and effect until all of the Secured Obligations shall have been
Paid in Full.
(e)
No payment made by Company, any of the Guarantors, any other
guarantor
or any other Person or received or collected by Administrative
Agent or any
Lender from Company, 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
the Secured 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
Secured Obligations or any payment received or collected from such
Guarantor in
respect of the Secured Obligations), remain liable for the Secured
Obligations
up to the maximum liability of such Guarantor hereunder until the
Secured
Obligations are Paid in Full.
2.2
Right of Contribution. Each Guarantor hereby agrees that to the
extent
that a Guarantor shall have paid more than its proportionate share
of any
payment made hereunder, such Guarantor shall be entitled to seek
and receive
contribution from and against any other Guarantor hereunder which
has not paid
its proportionate share of such payment. Each Guarantor's right of
contribution
shall be subject to the terms and conditions of Section 2.3. The
provisions of
this Section 2.2 shall in no respect limit the obligations and
liabilities of
any Guarantor to Administrative Agent and Lenders, and each
Guarantor shall
remain liable to Administrative Agent and Lenders for the full
amount guaranteed
by such Guarantor hereunder.
2.3
No Subrogation. Notwithstanding any payment made by any
Guarantor
hereunder or any set-off or application of funds of any Guarantor
by
Administrative Agent or any Lender, no Guarantor shall be entitled
to be
subrogated to any of the rights of Administrative Agent or any
Lender against
Company or any other Guarantor or any collateral security or
guarantee or right
of offset held by Administrative Agent or any Lender for the
payment of the
Secured Obligations, nor shall any Guarantor seek or be entitled to
seek any
contribution or reimbursement from Company or any other Guarantor
in respect of
payments made by such Guarantor hereunder, until all of the Secured
Obligations
are Paid in Full. If any amount shall be paid to any Guarantor on
account of
such subrogation rights at any time when all of the Secured
Obligations shall
not have been Paid in Full, such amount shall be held by such
Guarantor in trust
for Administrative Agent and Lenders, segregated from other funds
of such
Guarantor, and shall, forthwith upon receipt by such Guarantor, be
turned over
to Administrative Agent in the exact form received by such
Guarantor (duly
indorsed by such Guarantor to Administrative Agent, if required),
to be applied
against the Secured Obligations, whether matured or unmatured, in a
manner that
is consistent with the provisions of Section 2.4(A) and 2.4(B) of
the Credit
Agreement.
-6-
<PAGE>
2.4
Amendments, etc. with respect to the Secured Obligations. 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
Secured
Obligations made by Administrative Agent or any Lender may be
rescinded by
Administrative Agent or such Lender and any of the Secured
Obligations
continued, and the Secured 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, modified, accelerated,
compromised, waived,
surrendered or released by Administrative Agent or any Lender, and
the Credit
Agreement and the other Loan Documents and any other documents
executed and
delivered in connection therewith may be amended, modified,
supplemented or
terminated, in whole or in part, as Administrative Agent (or the
Requisite
Lenders or all Lenders, 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 Administrative Agent or any Lender for the payment of the
Secured Obligations
may be sold, exchanged, waived, surrendered or released. Neither
Administrative
Agent nor any Lender shall have any obligation to protect, secure,
perfect or
insure any Lien at any time held by it as security for the Secured
Obligations
or for the guarantee contained in this Section 2 or any property
subject
thereto.
2.5
Guarantee Absolute and Unconditional. Each Guarantor waives any and
all
notice of the creation, renewal, extension or accrual of any of the
Secured
Obligations and notice of or proof of reliance by Administrative
Agent or any
Lender upon the guarantee contained in this Section 2 or acceptance
of the
guarantee contained in this Section 2; the Secured Obligations, and
any of them,
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 Company and any of the
Guarantors,
on the one hand, and Administrative Agent and Lenders, 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
(a) diligence, presentment, protest, demand for payment and notice
of default or
nonpayment to or upon Company or any of the Guarantors with respect
to the
Secured Obligations, (b) notice of the existence or creation or
non-payment of
all or any of the Secured Obligations, and (c) all diligence in
collection or
protection of or realization upon any Secured Obligations or any
security for or
guaranty of any Secured Obligations.
The
Administrative Agent or any Lender may, from time to time, at its
sole
discretion and without notice to any Guarantor (or any of them),
take any or all
of the following actions: (a) retain or obtain a security interest
in any
property to secure any of the Secured Obligations or any obligation
hereunder,
(b) retain or obtain the primary or secondary obligation of any
obligor or
obligors with respect to any of the Secured Obligations, (c) extend
or renew any
of the Secured Obligations for one or more periods (whether or not
longer than
the original period), alter or exchange any of the Secured
Obligations, or
release or compromise any obligation of any Guarantor or any
obligation of any
nature of any other obligor with respect to any of the Secured
Obligations, (d)
release any guaranty or right of offset or its security interest
in, or
surrender, release or permit any substitution or exchange for, all
or any part
of any property securing any of the Secured Obligations or any
obligation
hereunder, or extend or renew for one or more periods (whether or
not longer
than the original period) or release, compromise, alter or exchange
any
obligations of any nature of any obligor with respect to any such
property, and
(e) resort to any Guarantor for payment of any of the Secured
Obligations when
due, whether or not Administrative Agent or such Lender shall have
resorted to
any property securing any of the Secured Obligations or any
obligation hereunder
or shall have proceeded against any other Guarantor or any other
obligor
primarily or secondarily obligated with respect to any of the
Secured
Obligations.
-7-
<PAGE>
2.6
Payments. Each Guarantor hereby guarantees that payments hereunder
will
be paid to Administrative Agent without set-off or counterclaim at
the office of
Administrative Agent specified in the Credit Agreement in the
applicable
currency, as specified in Section 2.4B(i) of the Credit
Agreement.
Section 3 Grant of Security Interest.
Each
Grantor hereby assigns and transfers to Administrative Agent,
and
hereby grants to Administrative Agent, for the ratable benefit of
Lenders and
(to the extent provided herein) their Affiliates, a security
interest in all of
its Collateral, as collateral security for the prompt and complete
payment and
performance when due (whether at the stated maturity, by
acceleration or
otherwise) of the Secured Obligations.
Section 4 Representations and Warranties.
To
induce Administrative Agent and Lenders to enter into the
Credit
Agreement and to induce Lenders to make their respective extensions
of credit to
Company thereunder, each Grantor jointly and severally hereby
represents and
warrants to Administrative Agent and each Lender that:
4.1
Title; No Other Liens. Except for Permitted Encumbrances and,
except
with respect to any Pledged Equity or Pledged Notes, the other
Liens permitted
under subsection 7.2 of the Credit Agreement (collectively,
"Permitted Liens"),
the Grantors in the aggregate own each item of the Collateral free
and clear of
any and all Liens or claims of others. No financing statement or
other public
notice with respect to all or any part of the Collateral is on file
or of record
in any public office, except filings evidencing Permitted Liens and
filings for
which termination statements have been delivered to Administrative
Agent.
4.2
Perfected First Priority Liens. The security interests granted
pursuant
to this Agreement (a) upon completion of the filings and other
actions specified
on Schedule 2 (which, in the case of all filings and other
documents referred to
on Schedule 2, except to the extent set forth herein or in the
Credit Agreement,
have been delivered to Administrative Agent in completed and duly
executed form)
will constitute valid perfected security interests in all of the
Collateral in
favor of Administrative Agent, for the ratable benefit of Lenders,
as collateral
security for each Grantor's Obligations, enforceable in accordance
with the
terms hereof against all creditors of each Grantor and any Persons
purporting to
purchase any Collateral from each Grantor, and (b) are prior to all
other Liens
on the Collateral in existence on the date hereof except for Liens
expressly
permitted by the Credit Agreement. The filings and other actions
specified on
Schedule 2 constitute all of the filings and other actions
necessary to perfect
all security interests granted hereunder.
4.3
Grantor Information. On the date hereof, Schedule 3 sets forth (a)
each
Grantor's jurisdiction of organization, (b) the location of each
Grantor's chief
executive office, (c) each Grantor's exact legal name as it appears
on its
organizational documents, (d) each Grantor's federal employer
identification
number, and (e) each Grantor's organizational identification
number.
-8-
<PAGE>
4.4
Collateral Locations. On the date hereof, Schedule 4 sets forth
(a)
each place of business of each Grantor (including its chief
executive office),
(b) all locations where all Inventory and Equipment owned by each
Grantor is
kept, except with respect to Inventory and Equipment with a fair
market value of
less than $25,000 (in the aggregate for all Grantors) which may be
located at
other locations within the United States, and (c) whether each such
Collateral
location and place of business (including each Grantor's chief
executive office)
is owned or leased (and if leased, specifies the complete name and
notice
address of each lessor). As of the date hereof, no Collateral is
located outside
the United States or in the possession of any lessor, bailee,
warehouseman or
consignee, except as indicated on Schedule 4.
4.5
Certain Property. On the date hereof, none of the Collateral
constitutes, or is the Proceeds of, (a) Farm Products, (b)
Health-Care-Insurance
Receivables or (c) vessels, aircraft or any other property subject
to any
certificate of title or other registration statute of the United
States, any
State or other jurisdiction, except for personal vehicles owned by
the Grantors
and used by employees of the Grantors in the ordinary course of
business with an
aggregate fair market value of less than $100,000 (in the aggregate
for all
Grantors).
4.6
Pledged Equity; Pledged Notes; Investment Property.
(a)
The Pledged Equity pledged by each Grantor hereunder constitutes
all
the issued and outstanding equity interests of each Issuer owned by
such Grantor
or, in the case of any Foreign Subsidiary, 65% of all issued and
outstanding
equity interests of such Foreign Subsidiary, except for the equity
interests of
any Issuer which, pursuant to the Credit Agreement, are not
required to be
pledged hereunder.
(b)
All of the Pledged Equity has been duly and validly issued and is
fully
paid and nonassessable.
(c)
Each of the Pledged Notes which constitutes a material item of
Collateral constitutes the legal, valid and binding obligation of
the obligor
with respect thereto, enforceable in accordance with its terms
(subject to the
effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization,
moratorium and other similar laws relating to or affecting
creditors' 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).
(d)
Schedule 1 lists all Investment Property owned by each Grantor.
Each
Grantor is the record and beneficial owner of, and has good and
marketable title
to, the Investment Property pledged by it hereunder, free of any
and all Liens
or options in favor of, or claims of, any other Person, except the
security
interest created by this Agreement and, in the case of Investment
Property which
does not constitute Pledged Equity or Pledged Notes, for Permitted
Encumbrances.
-9-
<PAGE>
4.7
Receivables.
(a)
No material amount payable to such Grantor under or in connection
with
any Receivable is evidenced by any Instrument or Chattel Paper
which has not
been delivered to Administrative Agent.
(b)
No obligor on any material Receivable is a governmental
authority,
other than Receivables in respect of which the applicable Grantor
has taken all
steps necessary to comply with the Federal Assignment of Claims Act
or other
corresponding law.
(c)
The amounts represented by such Grantor to Lenders from time to
time as
owing to such Grantor in respect of the Receivables (to the extent
such
representations are required by any of the Loan Documents) will at
all such
times be accurate in all material respects.
4.8
Intellectual Property.
(a)
Schedule 5 lists all registered Intellectual Property owned by
each
Grantor in its own name on the date hereof, other than Excluded
Property (IP).
(b)
On the date hereof, all such Intellectual Property owned by any
Guarantor is valid, subsisting, unexpired and enforceable, has not
been
abandoned and, to such Grantor's knowledge, does not materially
infringe upon
the intellectual property rights of any other Person.
(c)
Except as set forth in Schedule 5, as of the date hereof, no
such
Intellectual Property is the subject of any licensing or franchise
agreement
pursuant to which such Grantor is the licensor or franchisor.
(d)
No holding, decision or judgment has been rendered by any
governmental
authority which would limit, cancel or question the validity of, or
any
Grantor's rights in, any Intellectual Property owned by any Grantor
in any
material respect.
(e)
No action or proceeding is pending, or, to the knowledge of
such
Grantor, threatened, on the date hereof (i) seeking to limit,
cancel or question
the validity of any Intellectual Property or any Grantor's
ownership interest
therein, or (ii) which, if adversely determined, would adversely
affect the
value of any Intellectual Property in any material respect.
(f)
Each Grantor owns and possesses or has a license or other right to
use
all Intellectual Property as is necessary for the conduct of the
businesses of
such Grantor, without any infringement upon rights of others which
could
reasonably be expected to have a Material Adverse Effect.
4.9
Depositary and Other Accounts. All Deposit Accounts and all
other
depositary and other accounts maintained by each Grantor as of the
Closing Date,
other than, in each case, Excluded Property (Customer Deposits),
are described
on Schedule 6 hereto, which description includes for each such
account the name
of the Grantor maintaining such account, the name, address,
telephone and fax
numbers of the financial institution at which such account is
maintained, the
account number and the account officer, if any, of such
account.
-10-
<PAGE>
4.10
Excluded Property (Other). Each Grantor represents, warrants
and
covenants that it does not own, and will not own, assets which
satisfy the
definition of Excluded Property (Other), which when aggregated, are
material to
the business of such Grantor.
4.11
Credit Agreement. Each Grantor makes each of the representations
and
warranties made by Company in Section 5 of the Credit Agreement
(which
representations and warranties shall be deemed to have been renewed
upon each
borrowing or issuance of a Letter of Credit under the Credit
Agreement). Such
representations and warranties are incorporated herein by this
reference as if
fully set forth herein.
Section 5 Covenants.
Each
Grantor covenants and agrees with Administrative Agent and
Lenders
that, from and after the date of this Agreement until the Secured
Obligations
shall have been Paid in Full:
5.1
Delivery of Instruments, Certificated Securities and Chattel Paper.
If
any amount payable under or in connection with any of the
Collateral in excess
of $25,000 (in the aggregate for all Grantors) shall be or become
evidenced by
any Instrument, Certificated Security or Chattel Paper, such
Instrument,
Certificated Security or Chattel Paper shall be immediately
delivered to
Administrative Agent, duly indorsed in a manner reasonably
satisfactory to
Administrative Agent, to be held as Collateral pursuant to this
Agreement and in
the case of Electronic Chattel Paper, the applicable Grantor shall
cause
Administrative Agent to have control thereof within the meaning set
forth in
Section 9-105 of the UCC. In the event that an Event of Default
shall have
occurred and be continuing, upon the request of Administrative
Agent, any
Instrument, Certificated Security or Chattel Paper not theretofore
delivered to
Administrative Agent and at such time being held by any Grantor
shall be
immediately delivered to Administrative Agent, duly indorsed in a
manner
reasonably satisfactory to Administrative Agent, to be held as
Collateral
pursuant to this Agreement and in the case of Electronic Chattel
Paper, the
applicable Grantor shall cause Administrative Agent to have control
thereof
within the meaning set forth in Section 9-105 of the UCC.
5.2
Maintenance of Perfected Security Interest; Further
Documentation.
(a)
Such Grantor shall maintain the security interest created by
this
Agreement as a perfected security interest having at least the
priority
described in Section 4.2 and shall defend such security interest
against the
claims and demands of all Persons whomsoever.
(b)
Such Grantor will furnish to Administrative Agent and Lenders from
time
to time statements and schedules further identifying and describing
the assets
and property of such Grantor and such other reports in connection
therewith as
Administrative Agent may reasonably request, all in reasonable
detail.
(c)
Subject to the terms of the Credit Agreement and this Agreement, at
any
time and from time to time, upon the written request of
Administrative Agent,
and at the sole expense of such Grantor, such Grantor will promptly
and duly
execute and deliver, and have recorded, such further instruments
and documents
and take such further actions as Administrative Agent may
reasonably request for
the purpose of obtaining or preserving the full benefits of this
Agreement and
of the rights and powers herein granted, including (i) filing any
financing or
continuation statements under the UCC (or other similar laws) in
effect in any
jurisdiction with respect to the security interests created hereby,
(ii) in the
case of Investment Property, Deposit Accounts, Electronic Chattel
Paper and
Letter of Credit Rights and any other relevant Collateral, taking
any actions
necessary to enable Administrative Agent to obtain "control"
(within the meaning
of the applicable UCC) with respect thereto, in each case pursuant
to documents
in form and substance reasonably satisfactory to Administrative
Agent and (iii)
during the continuance of an Event of Default, if requested by
Administrative
Agent, delivering, to the extent permitted by law, any original
motor vehicle
certificates of title received by such Grantor from the applicable
secretary of
state or other governmental authority after information
reflecting
Administrative Agent's security interest has been recorded
therein.
-11-
<PAGE>
(d) Each Grantor
authorizes Administrative Agent to, at any time and from
time to time, file financing statements, continuation statements,
and amendments
thereto that describe the Collateral (including describing the
Collateral as
"all assets" of each Grantor, or words of similar effect), and
which contain any
other information required pursuant to the UCC for the sufficiency
of filing
office acceptance of any financing statement, continuation
statement, or
amendment, and each Grantor agrees to furnish any such information
to
Administrative Agent promptly upon request. Any such financing
statement,
continuation statement, or amendment may be signed (to the extent
signature of a
Grantor is required under applicable law) by Administrative Agent
on behalf of
any Grantor and may be filed at any time in any jurisdiction.
(e)
Subject to the terms of the Credit Agreement and this Agreement,
each
Grantor shall, at any time and from time and to time, take such
steps as
Administrative Agent may reasonably request for Administrative
Agent (i) to
obtain an acknowledgement, in form and substance reasonably
satisfactory to
Administrative Agent, of any bailee having possession of any of the
Collateral,
stating that the bailee holds such Collateral for Administrative
Agent, (ii) to
obtain "control" of any letter-of-credit rights, or electronic
chattel paper (as
such terms are defined by the UCC with corresponding provisions
thereof defining
what constitutes "control" for such items of Collateral), with any
agreements
establishing control to be in form and substance reasonably
satisfactory to
Administrative Agent, and (iii) otherwise to insure the continued
perfection and
priority of Administrative Agent's security interest in any of the
Collateral
and of the preservation of its rights therein.
(f)
Without limiting the generality of the foregoing, if any Grantor at
any
time holds or acquires an interest in any electronic chattel paper
or any
"transferable record", as that term is defined in Section 201 of
the federal
Electronic Signatures in Global and National Commerce Act, or in
ss.16 of the
Uniform Electronic Transactions Act as in effect in any relevant
jurisdiction,
such Grantor shall promptly notify Administrative Agent thereof
and, at the
request of Administrative Agent, shall take such action as
Administrative Agent
may reasonably request to vest in Administrative Agent "control"
under Section
9-105 of the UCC of such electronic chattel paper or control under
Section 201
of the federal Electronic Signatures in Global and National
Commerce Act or, as
the case may be, ss.16 of the Uniform Electronic Transactions Act,
as so in
effect in such jurisdiction, of such transferable record.
Administrative Agent
agrees with the Grantors that Administrative Agent will arrange,
pursuant to
procedures satisfactory to Administrative Agent and so long as such
procedures
will not result in Administrative Agent's loss of control, for the
Grantors to
make alterations to the electronic chattel paper or transferable
record
permitted under Section 9-105 of the UCC or, as the case may be,
Section 201 of
the federal Electronic Signatures in Global and National Commerce
Act or ss.16
of the Uniform Electronic Transactions Act for a party in control
to make
without loss of control, unless an Event of Default has occurred
and is
continuing or would occur after taking into account any action by
any Grantor
with respect to such electronic chattel paper or transferable
record.
-12-
<PAGE>
5.3
Changes in Locations, Name, etc. Such Grantor shall not, except
upon 30
days' prior written notice to Administrative Agent and delivery
to
Administrative Agent of (a) all additional financing statements and
other
documents reasonably requested by the Administrative Agent as to
the validity,
perfection and priority of the security interests provided for
herein and (b) if
applicable, a written supplement to Schedule 4 showing any
additional location
at which Inventory or Equipment shall be kept:
(i) permit any material portion of the Inventory or Equipment to
be
permanently located at a location other than those
