SECURITY AGREEMENT

EXHIBIT 4.6

 

EXECUTION VERSION

 

 

 

 

 

SECURITY AGREEMENT

 

among

 

ACCO BRANDS CORPORATION,

 

CERTAIN OTHER SUBSIDIARIES OF ACCO BRANDS CORPORATION

FROM TIME TO TIME PARTY HERETO

 

and

 

U.S. BANK NATIONAL ASSOCIATION,

as COLLATERAL TRUSTEE

 

________________________________

 

Dated as of September 30, 2009

________________________________

 

 

 

 

 

 

 

SECURITY AGREEMENT

 

SECURITY AGREEMENT (as amended, modified, restated and/or supplemented from time to time, this “ Agreement ”), dated as of September 30, 2009, made by each of the undersigned assignors (each, an “ Assignor ” and, together with any other Person that becomes an assignor hereunder pursuant to Section 10.12, the “ Assignors ”) in favor of U.S. Bank National Association, as collateral trustee (together with any successor collateral trustee, the “ Collateral Trustee ”), for the benefit of the Secured Parties.  Certain capitalized terms as used herein are defined in Article IX.  Except as otherwise defined herein, all capitalized terms used herein and defined in the Collateral Trust Agreement (as defined below) shall be used herein as therein defined.

 

 

W I T N E S S E T H :

 

WHEREAS, ACCO Brands Corporation (the “ Issuer ”), the other Assignors and U.S. Bank National Association, as trustee (together with any successor trustee, the “ Indenture Trustee ”), have entered into an Indenture, dated as of September 30, 2009 (as amended, modified, restated and/or supplemented from time to time, the “ Indenture ”), relating to the Issuer’s 10.625% Senior Secured Notes due 2015 (the “ Senior Secured Notes ”);

 

WHEREAS, the Issuer, the other Assignors, the Trustee, the other representatives and agents from time to time party thereto and the Collateral Trustee have entered into a Collateral Trust Agreement, dated as of September 30, 2009 (as amended, modified, restated and/or supplemented from time to time, the “ Collateral Trust Agreement ”);

 

WHEREAS, pursuant to the Indenture, each Guarantor party thereto has guaranteed to the Secured Parties the payment when due of all Secured Debt Obligations;

 

WHEREAS, it is a condition precedent to the issuance of any Senior Secured Notes and any other Series of Priority Lien Debt pursuant to the Priority Lien Documents that each Assignor shall have secured its obligations under the Indenture and the other Secured Debt Documents as set forth herein and executed and delivered to the Pledgee this Agreement; and

 

 

 

WHEREAS, each Assignor will obtain benefits from the issuance of Senior Secured Notes and the other transactions contemplated by the Priority Lien Documents and, accordingly, desires to execute this Agreement in order to satisfy the condition described in the preceding paragraph;

 

NOW, THEREFORE, in consideration of the benefits accruing to each Assignor, the receipt and sufficiency of which are hereby acknowledged, each Assignor hereby makes the following representations and warranties to the Collateral Trustee for the benefit of the Secured Parties and hereby covenants and agrees with the Collateral Trustee for the benefit of the Secured Parties as follows:

 

ARTICLE I

 

SECURITY INTERESTS

 

1.1   Grant of Security Interests .  (a)  As security for the prompt and complete payment and performance when due of all of the Secured Debt Obligations, each Assignor does hereby assign and transfer unto the Collateral Trustee, and does hereby pledge and grant to the Collateral Trustee, for the benefit of the Secured Parties, a continuing security interest in all of the right, title and interest of such Assignor in, to and under all of the following personal property and fixtures (and all rights therein) of such Assignor, or in which or to which such Assignor has any rights, in each case whether now existing or hereafter from time to time acquired:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

provided that, notwithstanding anything to the contrary in this Agreement, this Agreement shall not constitute a grant of a security interest in, and “Collateral” shall not include, any Excluded Asset.

 

 

 

(b)           The security interest of the Collateral Trustee under this Agreement extends to all Collateral which any Assignor may acquire, or with respect to which any Assignor may obtain rights, at any time during the term of this Agreement.

 

(c)           Notwithstanding anything to the contrary contained in this Section 1.1 or elsewhere in this Agreement, each Assignor and the Collateral Trustee (on behalf of the Secured Parties) acknowledges and agrees that:

 

 

 

 

1.2   Power of Attorney .  Each Assignor hereby constitutes and appoints the Collateral Trustee and any officer or agent thereof (such appointment being coupled with an interest) its true and lawful attorney, irrevocably, with full power (in the name of such Assignor or otherwise) to, in each case subject to the Intercreditor Agreement:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Each Assignor hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue hereof.

 

ARTICLE II

 

GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS

 

Each Assignor represents, warrants and covenants, which representations, warranties and covenants shall survive execution and delivery of this Agreement, as follows:

 

2.1   Necessary Filings .  All filings, registrations, recordings and other actions necessary or appro­priate to create, preserve and perfect the security interest granted by such

 

 

 

Assignor to the Collateral Trustee hereby in respect of the Collateral have been, or will within two Business Days of the Issue Date (or such later date as provided in the Indenture or other Secured Debt Documents) be, accomplished and the security interest granted to the Collateral Trustee pursuant to this Agreement in and to the Collateral creates a valid and, together with all such filings, registrations, recordings and other actions, a perfected security interest therein and such security interest is, in the case of the Notes Collateral, first priority, and in the case of the ABL Collateral, second priority, prior to the rights of all other Persons therein and subject to no other Liens (other than Permitted Liens) and is entitled to all the rights, priorities and benefits afforded by the UCC or other relevant law as enacted in any relevant jurisdic­tion to per­fected security interests, in each case to the extent that the Collateral consists of the type of prop­erty in which a security interest may be perfected by possession or control (within the meaning of the UCC as in effect on the date hereof in the State of New York), (i) by filing a financing statement under the UCC as enacted in any relevant jurisdiction or, (ii) in addition to the filing of such financing statements, by a filing of an Intellectual Property Security Agreement in the respective form attached hereto in the United States Patent and Trademark Office or in the United States Copyright Office or any foreign equivalent office reasonably requested by the Collateral Trustee (such filings of Intellectual Property Security Agreements under this clause (ii), the “ IP Filings ”); provided that with respect to such IP Filings, the requirements in the foregoing sentence shall apply (a) as of the Issue Date, with respect to all United States registrations and applications for material Intellectual Property and all other United States Intellectual Property for which all IP Recordals (as defined below) are complete, including the Intellectual Property set forth in Schedule 2.1(a), (b) as of 30 days after the Issue Date, with respect to all other United States registrations and applications for Intellectual Property, including the Intellectual Property set forth in Schedule 2.1(b), and (c) as of 90 days after the Issue Date, with respect to all material Intellectual Property that is subject to a registration or application in foreign jurisdictions, including the Intellectual Property set forth in Schedule 2.1(c).  For purposes of clarification and without limitation to the foregoing, prior to each applicable date set forth in clause (ii) of the preceding sentence, each Assignor shall, at such Assignor’s expense, effect the necessary corrective change of ownership and recordals with all patent, trademark and copyright offices, domain name registrars and other similar authorities (i) where Intellectual Property of any Assignor is still recorded in the name of legal predecessors of such Assignor or any party other than such Assignor or (ii) where the relevant recordals of the patent, copyright and trademark offices, domain name registrars and other similar authorities are incorrect for any other reason with respect to such Intellectual Property of any Assignor (such corrective change of ownership and recordals in clauses (i) and (ii), the “ IP Recordals ”).  No authorization, approval or other action by, and no notice to or filing with, any Governmental Authority or regulatory body is required for either (i) the pledge or grant by any Assignor of the security interests purported to be created in favor of the Collateral Trustee hereunder or (ii) the exercise by the Collateral Trustee of any rights or remedies in respect of any Collateral (whether specifically granted or created hereunder or created or provided for by applicable law), except (A) for the filings contemplated pursuant to this Section 2.1 and (B) as may be required, in connection with the disposition of any Investment Property, by laws generally affecting the offering and sale of securities and as may be required under federal laws pertaining to Intellectual Property.

 

2.2   No Liens .  Such Assignor is, and as to all Collateral acquired by it from time to time after the date hereof such Assignor will be, the owner of all Collateral free from any Lien or other right, title or interest of any Person (other than Permitted Liens), and, subject to the

 

 

Intercreditor Agreement, such Assignor shall defend the Collateral against all claims and demands of all Persons at any time claiming the same or any interest therein adverse to the Collateral Trustee.

 

2.3   Other Financing Statements .  As of the date hereof, there is no financ­ing state­ment (or similar statement or instrument of registration under the law of any juris­diction) covering or purporting to cover any interest of any kind in the Collateral (other than financing state­ments filed in respect of Permitted Liens), and so long as the Discharge of Priority Lien Obligations has not occurred or any other Secured Debt Obligations remain outstanding, such Assignor will not execute or authorize to be filed in any public office any financing state­ment (or similar statement or instrument of registra­tion under the law of any jurisdiction) or state­ments relating to the Collateral, except financ­ing statements filed or to be filed in respect of and covering the security interests granted hereby by such Assignor or in connection with Permitted Liens.

 

2.4   Chief Executive Office, Record Locations .  The chief executive office of such Assignor is, on the date of this Agreement, located at the address indicated in paragraph 1 of the Perfection Certificate for such Assignor.  During the period of the four calendar months preceding the date of this Agreement, the chief executive office of such Assignor has not been located at any address other than that indicated in paragraph 1 of the Perfection Certificate in accordance with the immediately preceding sentence, in each case unless each such other address is also indicated in paragraph 1 of the Perfection Certificate for such Assignor.

 

2.5   Location of Inventory and Equipment .  All Inventory and Equipment held on the date hereof, or held at any time during the four calendar months prior to the date hereof, by each Assignor is located at one of the locations shown in paragraph 1 of the Perfection Certificate for such Assignor.  Each Assignor shall keep all Equipment and Inventory in the locations specified in paragraph 1 of the Perfection Certificate; provided that Equipment and Inventory may be moved to another location in the United States as long as such location is in the United States and listed in paragraph 1 of the Perfection Certificate or such Assignor shall have provided the Collateral Trustee with prior written notice of such new location.

 

2.6   Legal Names; Type of Organization (and Whether a Registered Organization and/or a Transmitting Utility); Jurisdiction of Organization; Location; Organizational Identification Numbers; Federal Employer Identification Number; Changes Thereto; etc .  The exact legal name of each Assignor, the type of organization of such Assignor, whether or not such Assignor is a Registered Organization, the jurisdiction of organization of such Assignor, such Assignor’s Location, the organizational identification number (if any) of such Assignor, the Federal Employer Identification Number (if any), and whether or not such Assignor is a Transmitting Utility, is listed in paragraph 2 of the Perfection Certificate for such Assignor.  Such Assignor shall not change its legal name, its type of organization, its status as a Registered Organization (in the case of a Registered Organization), its status as a Transmitting Utility or as a Person which is not a Transmitting Utility, as the case may be, its jurisdiction of organization, its Location, its organizational identification number (if any), or its Federal Employer Identification Number (if any) from that listed in paragraph 2 of the Perfection Certificate, except that any such changes shall be permitted (so long as not in violation of the applicable requirements of the Secured Debt Documents and so long as same do not involve (x) a

 

 

Registered Organization ceasing to constitute same or (y) such Assignor changing its jurisdiction of organization or Location from the United States or a State thereof to a jurisdiction of organization or Location, as the case may be, outside the United States or a State thereof) if (i) it shall have given to the Collateral Trustee not less than 15 days’ prior written notice of each change to the information listed in paragraph 2 of the Perfection Certificate (as adjusted for any subsequent changes thereto previously made in accordance with this sentence), and (ii) in connection with the respective such change or changes, it shall have taken all action reasonably requested by the Collateral Trustee (or as directed by an Act of Required Debtholders) to maintain the security interests of the Collateral Trustee in the Collateral intended to be granted hereby at all times fully perfected and in full force and effect.  In addition, to the extent that such Assignor does not have an organizational identification number on the date hereof and later obtains one, such Assignor shall promptly thereafter notify the Collateral Trustee of such organizational identification number and shall take all actions reasonably satisfactory to the Collateral Trustee to the extent necessary to maintain the security interest of the Collateral Trustee in the Collateral intended to be granted hereby fully perfected and in full force and effect.

 

2.7   Trade Names; Etc.   Such Assignor has or operates in any jurisdiction under, or in the preceding five years has had or has operated in any jurisdiction under, no trade names, fictitious names or other names except its legal name as specified in paragraph 2(a) of the Perfection Certificate and such other trade or fictitious names as are listed in paragraph 3 of the Perfection Certificate for such Assignor.  Such Assignor has not changed its legal name as specified in paragraph 2(a) of the Perfection Certificate since August 17, 2005.  Such Assignor shall not assume or operate in any jurisdiction under any new trade, fictitious or other name until (i) it shall have given to the Collateral Trustee not less than 15 days’ written notice of its intention so to do, clearly describing such new name and the jurisdictions in which such new name will be used and providing such other information in connection therewith as the Collateral Trustee may reasonably request and (ii) with respect to such new name, it shall have taken all action reasonably requested by the Collateral Trustee (or as directed by an Act of Required Debtholders) to maintain the security interest of the Collateral Trustee in the Collateral intended to be granted hereby at all times fully perfected and in full force and effect.

 

2.8   Certain Significant Transactions . Since August 17, 2005, no Person shall have merged or consolidated with or into any Assignor, and no Person shall have liquidated into, or transferred all or substantially all of its assets to, any Assignor, in each case except as described in paragraph 4 of the Perfection Certificate.  With respect to any transactions so described in paragraph 4 of the Perfection Certificate, the respective Assignor shall have furnished such information with respect to the Person (and the assets of the Person and locations thereof) which merged with or into or consolidated with such Assignor, or was liquidated into or transferred all or substantially all of its assets to such Assignor, and shall have furnished to the Collateral Trustee such UCC lien searches as reasonably requested or as set forth in an Act of Required Debtholders with respect to such Person and its assets, to establish that no security interest (excluding Permitted Liens) continues perfected on the date hereof with respect to any Person described above (or the assets transferred to the respective Assignor by such Person), including without limitation pursuant to Section 9-316(a)(3) of the UCC.

 

 

 

2.9   Non-UCC Property .  The aggregate fair market value (as determined by the Assignors in good faith) of all property of the Assignors of the types described in clauses (1), (2) and (3) of Section 9-311(a) of the UCC (but excluding any Intellectual Property) does not exceed $1,000,000.  If the aggregate value of all such property at any time owned by all Assignors exceeds $1,000,000, the Assignors shall provide prompt written notice thereof to the Collateral Trustee and, upon the request of the Collateral Trustee, the Assignors shall promptly (and in any event within 30 days) take such actions (at their own cost and expense) as may be required under the respective United States, State or other laws referenced in Section 9-311(a) of the UCC to perfect the security interests granted herein in any Collateral where the filing of a financing statement does not perfect the security interest in such property in accordance with the provisions of Section 9-311(a) of the UCC; provided , however , that notwithstanding anything in this Section 2.9, the Assignors shall take such actions necessary to perfect the security interests granted herein in (x) Marks consistent with Article IV of this Agreement and (y) Copyrights and Patents consistent with Article V of this Agreement.

 

2.10   As-Extracted Collateral; Timber-to-be-Cut .  On the date hereof, such Assignor does not own, or expect to acquire, any property which constitutes, or would constitute, As-Extracted Collateral or Timber-to-be-Cut.  If at any time after the date of this Agreement such Assignor owns, acquires or obtains rights to any As-Extracted Collateral or Timber-to-be-Cut, such Assignor shall furnish the Collateral Trustee with prompt written notice thereof (which notice shall describe in reasonable detail the As-Extracted Collateral and/or Timber-to-be-Cut and the locations thereof) and shall take all actions as may be deemed reasonably necessary or desirable by the Collateral Trustee to perfect the security interest of the Collateral Trustee therein.

 

2.11   Collateral in the Possession of a Warehouseman, Bailee or Agent .  If any Inventory or other Goods are at any time in the possession of a warehouseman, bailee or agent, or is located at leased premises or mortgaged property such Assignor shall promptly notify the Collateral Trustee thereof and shall (i) notify any such warehouseman, bailee, agent or landlord of the security interest created hereunder, (ii) instruct any such warehouseman, bailee or agent to hold all such Collateral solely for the Collateral Trustee’s account subject only to the Collateral Trustee’s instructions (or the ABL Collateral Agent’s account subject only to the ABL Collateral Agent’s instructions with respect to ABL Collateral), and (iii) if requested by the Collateral Trustee, use its commercially reasonable efforts to (A) cause such warehouseman, bailee or agent to authenticate a record acknowledging that it holds possession of such Collateral for the Collateral Trustee’s benefit and shall act solely on the instructions of the Collateral Trustee (or for the ABL Collateral Agent’s benefit and shall act solely on the instructions of the ABL Collateral Agent with respect to ABL Collateral) without the further consent of the Assignor or any other Person and make such authenticated record available to the Collateral Trustee, and (B) obtain a landlord waiver and/or bailee agreement, in each case in form and substance reasonably satisfactory to the Collateral Trustee, from such warehouseman, bailee or agent or the applicable landlord or mortgagee. The Collateral Trustee agrees with such Assignor that the Collateral Trustee shall not give any such instructions unless an Event of Default has occurred and is continuing or would occur after taking into account any action by the respective Assignor with respect to any such bailee.

 

 

 

2.12   Inventory and Equipment .  The Inventory that has been produced or distributed by such Assignor has been produced in compliance with all requirements of applicable law in all material respects, including, without limitation, the Fair Labor Standards Act of 1938.  No Assignor shall knowingly produce, use or permit any Collateral to be used unlawfully or in violation of any provision of this Agreement or any applicable statute, regulation or ordinance or any policy of insurance covering the Collateral.  Each Assignor will cause its Equipment to be maintained and preserved in the same condition, repair and working order as when new, ordinary wear and tear excepted together with insured losses, and will forthwith, or in the case of any loss or damage to any of such Equipment as soon as practicable after the occurrence thereof, make or cause to be made all repairs, replacements and other improvements in connection therewith that are necessary or desirable to such end.  Each Assignor will promptly furnish to the Collateral Trustee a statement respecting any loss or damage exceeding $250,000 to any of its Equipment or Inventory.

 

2.13   Perfection Certificate .  The Perfection Certificate has been duly prepared, completed and executed by the Assignors and the information set forth therein, including the exact legal name of each Assignor, its jurisdiction of organization and its organizational number (if any), is true, accurate and complete as of the Effective Date and as of each delivery of a Perfection Certificate Supplement required pursuant to Section 6.3 or any other section of this Agreement.

 

2.14   Recourse .  This Agreement is made with full recourse to each Assignor and pursuant to and upon all the warranties, representations, covenants and agreements on the part of such Assignor contained herein, in the Secured Debt Documents and otherwise in writing in connection herewith or therewith.

 

ARTICLE III

 

SPECIAL PROVISIONS CONCERNING ACCOUNTS; CONTRACT RIGHTS; INSTRUMENTS; CHATTEL PAPER AND CERTAIN OTHER COLLATERAL

 

3.1   Additional Representations and Warranties .  As of the time when each of its Accounts arises, each Assignor shall be deemed to have represented and warranted that each such Account, and all records, papers and documents relating thereto (if any) are genuine and what they purport to be, and that all papers and documents (if any) relating thereto (i) will, to the knowledge of such Assignor, repre­sent the genuine, legal, valid and binding obligation of the account debtor evidencing indebt­ed­ness unpaid and owed by the respective account debtor arising out of the performance of labor or services or the sale or lease and delivery of the merchandise listed therein, or both, (ii) will be the only papers and documents evidencing and embodying such obligation of the account debtor named therein (other than copies created for general accounting purposes), (iii) will, to the knowledge of such Assignor, evidence true and valid obligations, enforceable in accordance with their respective terms, and (iv) will be in compli­ance and will conform in all material respects with all applicable federal, state and local laws and applicable laws of any relevant foreign jurisdiction.

 

3.2   Maintenance of Records .  Each Assignor will keep and maintain at its own cost and expense accurate records of its Accounts and Contracts, including, but not limited to,

 

 

 

originals of all documentation (including each Contract) with respect thereto, records of all pay­ments received, all credits granted thereon, all merchandise returned and all other dealings there­with, and such Assignor will make the same available on such Assignor’s premises to the Collateral Trustee for inspection, at such Assignor’s own cost and expense, at any and all reason­able times upon prior notice to such Assignor and otherwise in accordance with the Indenture and the Collateral Trust Agreement.  Upon the occurrence and during the continuance of an Event of Default and at the request of the Collateral Trustee, such Assignor shall, promptly, at its own cost and expense, deliver all tangible evidence of its Accounts and Contract Rights (including, without limitation, all documents evidencing the Accounts and all Contracts) and such books and records to the Collateral Trustee or to its representatives (copies of which evidence and books and records may be retained by such Assignor).  Upon the occurrence and during the continuance of an Event of Default and if the Collateral Trustee so directs, such Assignor shall legend, in form and manner satisfactory to the Collateral Trustee, the Accounts and the Contracts, as well as books, records and documents (if any) of such Assignor evidencing or pertaining to such Accounts and Contracts with an appropriate reference to the fact that such Accounts and Contracts have been assigned to the Collateral Trustee and that the Collateral Trustee has a security interest therein.

 

3.3   Direction to Account Debtors; Contracting Parties; etc.   Subject to the Intercreditor Agreement, upon notice to the Issuer of the occurrence and during the continuance of an Event of Default, if the Collateral Trustee so directs any Assignor, such Assignor agrees (x) to cause all payments on account of the Accounts, Receivables, Related Contracts and Contracts to be made directly to the Collateral Proceeds Account, (y) that the Collateral Trustee may, at its option, directly notify the obligors with respect to any Accounts, Receivables, Related Contracts and/or under any Contracts to make payments with respect thereto as provided in the preceding clause (x), and (z) that the Collateral Trustee may enforce collection of any such Accounts, Receivables, Related Contracts and Contracts and may adjust, settle or compromise the amount of payment thereof, in the same manner and to otherwise exercise all rights with respect to such Accounts, Receivables, Assigned Agreements and Related Contracts, including, without limitation, those set forth set forth in Section 9-607 of the UCC.  Subject to the Intercreditor Agreement, upon the occurrence and during the continuation of an Event of Default and upon demand of the Collateral Trustee, all amounts and proceeds (including, without limitation, Instruments) received by such Assignor in respect of the Accounts, Receivables, Related Contracts and Contracts of such Assignor shall be received in trust for the benefit of the Collateral Trustee hereunder, shall be segregated from other funds of such Assignor and shall be transferred to the Collateral Proceeds Account for application to the Secured Debt Obligations as provided in Section 3.4 of the Collateral Trust Agreement.  The reasonable costs and expenses of collection (includ­ing reasonable attorneys’ fees), whether incurred by an Assignor or the Collateral Trustee, shall be borne by the relevant Assignor.  The Collateral Trustee shall deliver a copy of each notice referred to in the preceding clause (y) to the relevant Assignor, provided that (x) the failure by the Collateral Trustee to so notify such Assignor shall not affect the effectiveness of such notice or the other rights of the Collateral Trustee created by this Section 3.3 and (y) no such notice shall be required if an Event of Default of the type described in Section 6.01(g) or Section 6.01(h) of the Indenture has occurred and is continuing.

 

3.4   Modification of Terms; etc .  Except in accordance with such Assignor’s ordinary course of business and consistent with reasonable business judgment or as permitted by

 

 

Section 3.5, no Assignor shall rescind or cancel any indebtedness evidenced by any Account or under any Contract, or modify any material term thereof or make any material adjustment with respect thereto, or extend or renew the same, or compromise or settle any material dispute, claim, suit or legal proceeding relating thereto, or sell any Account or Contract, or interest therein, without the prior written consent of the Collateral Trustee (or as directed by an Act of Required Debtholders).  Other than as provided in this Section 3.4, no Assignor will do anything to materially impair the rights of the Collateral Trustee in the Accounts or Contracts.

 

3.5   Collection .  Each Assignor shall endeavor in accordance with reasonable busi­ness practices to cause to be collected from the account debtor named in each of its Accounts and Receivables or obligor under any Contract or Related Contract, as and when due (including, without limitation, amounts which are delinquent, such amounts to be collected in accordance with generally accepted lawful collection procedures) any and all amounts owing under or on account of such Account, Receivable, Contract or Related Contract, and apply forthwith upon receipt thereof all such amounts as are so collected to the outstanding balance of such Account or Receivable or under such Contract or Related Contract.  Except as otherwise directed by the Collateral Trustee after the occurrence and during the continuation of an Event of Default, any Assignor may allow in the ordinary course of business as adjustments to amounts owing under its Accounts, Receivables, Contracts and Related Contracts (i) an extension or renewal of the time or times of payment, or settlement for less than the total unpaid balance, which such Assignor finds appropriate in accordance with reason­able business judgment and (ii) a refund or credit due as a result of returned or damaged merchan­dise or improperly performed services or for other reasons which such Assignor finds appropriate in accordance with reasonable business judgment.  Except in the ordinary course of business and consistent with past practice, no Assignor will permit or consent to the subordination of its right to payment under any of the Accounts, Receivables, Contracts or Related Contracts to any other indebtedness or obligations of the Account Debtor or obligor thereof.  The reasonable costs and expenses (including, without limitation, reasonable attorneys’ fees) of collection, whether incurred by an Assignor or the Collateral Trustee, shall be borne by the relevant Assignor.

 

3.6   Instruments .  If any Assignor owns or acquires any Instrument in excess of $1,000,000 constituting Collateral (other than (x) checks and other payment instruments received and collected in the ordinary course of business and (y) any Instrument subject to pledge pursuant to the Pledge Agreement), such Assignor will within 10 Business Days notify the Collateral Trustee thereof, and upon request by the Collateral Trustee will promptly deliver such Instru­ment to the Collateral Trustee appropriately endorsed to the order of the Collateral Trustee (unless the ABL Collateral Agent is granted a prior security interest in such Instrument and the same is required to be delivered (and are delivered) to the ABL Collateral Agent for the benefit of the holders of ABL Debt Obligations pursuant to the Intercreditor Agreement).

 

3.7   Assignors Remain Liable Under Accounts .  Anything herein to the contrary notwithstanding, the Assignors shall remain liable under each of the Accounts and Receivables to observe and perform all of the conditions and obligations to be observed and performed by it thereunder, all in accordance with the terms of any agreement giving rise to such Accounts or Receivables, as applicable.  Neither the Collateral Trustee nor any other Secured Party shall have any obligation or liability under any Account (or any agreement giving rise thereto) by reason of or arising out of this Agreement or the receipt by the Collateral Trustee or any other Secured

 

 

Party of any payment relating to such Account or Receivable pursuant hereto, nor shall the Collateral Trustee or any other Secured Party be obli­gated in any manner to perform any of the obligations of any Assignor under or pursuant to any Account or Receivable (or, in each case, any agreement giving rise thereto), to make any payment, to make any inquiry as to the nature or the sufficiency of any payment received by them or as to the sufficiency of any performance by any party under any Account or Receivable (or, in each case, any agreement giving rise thereto), to present or file any claim, to take any action to enforce any performance or to collect the payment of any amounts which may have been assigned to them or to which they may be entitled at any time or times.

 

3.8   Assignors Remain Liable Under Contracts .  Anything herein to the contrary notwithstanding, the Assignors shall remain liable under each of the Contracts or Related Contracts to observe and per­form all of the conditions and obligations to be observed and performed by them thereunder, all in accordance with and pursuant to the terms and provisions of each Contract or Related Contract, as applicable.  Neither the Collateral Trustee nor any other Secured Party shall have any obligation or liability under any Contract or Related Contract by reason of or arising out of this Agreement or the receipt by the Collateral Trustee or any other Secured Party of any payment relating to such Contract or Related Contract, as the case may be, pursuant hereto, nor shall the Collateral Trustee or any other Secured Party be obligated in any manner to perform any of the obligations of any Assignor under or pursuant to any Contract or Related Contract, as the case may be, to make any payment, to make any inquiry as to the nature or the sufficiency of any performance by any party under any Contract or Related Contract, as the case may be, to present or file any claim, to take any action to enforce any performance or to collect the payment of any amounts which may have been assigned to them or to which they may be entitled at any time or times.

 

3.9   Deposit Accounts; Etc.   (a) Each Assignor hereby represents and warrants that, as of the date hereof, it does not maintain any Deposit Accounts, Securities Accounts or Commodity Accounts other than the Deposit Accounts, Securities Accounts and Commodity Accounts listed on Schedule 15 to the Perfection Certificate.  Each of the Assignors will, within 60 days of the Issue Date (or, except for the Collateral Proceeds Account, such later date as determined by the ABL Collateral Agent in its sole discretion), deliver to the Collateral Trustee fully executed control agreements in form and substance reasonably satisfactory to the Collateral Trustee (or as directed by an Act of Required Debtholders) with respect to each of the Deposit Accounts, Securities Accounts and Commodity Accounts, other than Excluded Accounts, owned or maintained by such Assignor.  From and after 60 days following the Issue date, no Assignor shall hereafter establish and maintain any Deposit Account, Securities Account or Commodity Account, other than an Excluded Account, unless (1) the applicable Assignor shall have given the Collateral Trustee prior written notice of its intention to establish such new Deposit Account, Securities Account or Commodity Account and (2) such Assignor shall have delivered to the Collateral Trustee a fully executed control agreement with respect to such Deposit Account, Securities Account or Commodity Account.  No Assignor shall grant control of any Deposit Account, Securities Account or Commodity Account to any Person other than the Collateral Trustee and, subject to the terms of the Intercreditor Agreement, the ABL Collateral Agent.

 

(b)           Subject to the Intercreditor Agreement, the Collateral Trustee may, at any time and upon notice to, but without consent from, any applicable Assignor, take control of,

 

 

 

transfer, or direct the transfer of, funds from any Deposit Account, Securities Account or Commodity Account, other than an Excluded Account, owned or maintained by such Assignor to satisfy such Assignor’s obligations under the Secured Debt Documents if an Event of Default shall have occurred and be continuing.

 

(c)           All amounts received in respect of any Account of an Account Debtor of any Assignor, in addition to all other cash received by any Assignor from any other source, shall upon receipt be promptly deposited into a Deposit Account, Securities Account or Commodity Account that is not, in each case, an Excluded Account.

 

3.10   Letter-of-Credit Rights .  If any Assignor is at any time a beneficiary under a letter of credit with a stated amount of $1,000,000 or more, such Assignor shall promptly notify the Collateral Trustee thereof and, at the request of the Collateral Trustee, such Assignor shall, pursuant to an agreement in form and substance reasonably satisfactory to the Collateral Trustee (or as directed by an Act of Required Debtholders), use its reasonable best efforts to (i) arrange for the issuer and any confirmer of such letter of credit to consent to an assignment to the Collateral Trustee of the proceeds of any drawing under such letter of credit or (ii) arrange for the Collateral Trustee to become the transferee beneficiary of such letter of credit (unless the ABL Collateral Agent is granted a prior security interest in such letter of credit and the issuer or confirmer of such letter of credit is required to consent to an assignment to the ABL Collateral Agent or the ABL Collateral Agent is required to become the transferee beneficiary of such letter of credit pursuant to the Intercreditor Agreement), with the Collateral Trustee agreeing, in each case, that the proceeds of any drawing under the letter of credit are to be applied as provided in this Agreement after the occurrence and during the continuance of an Event of Default.

 

3.11   Commercial Tort Claims .  All Commercial Tort Claims of each Assignor in existence on the date of this Agreement are described in paragraph 5 of the Perfection Certificate.  If any Assignor shall at any time after the date of this Agreement acquire a Commercial Tort Claim in an amount (taking the greater of the aggregate claimed damages thereunder or the reasonably estimated value thereof) of $1,000,000 or more, such Assignor shall promptly notify the Collateral Trustee thereof in a writing signed by such Assignor and describing the details thereof and shall grant to the Collateral Trustee in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to the Collateral Trustee (or as directed by an Act of Required Debtholders).

 

3.12   Chattel Paper .  Upon the request of the Collateral Trustee made at any time or from time to time, each Assignor shall promptly furnish to the Collateral Trustee a list of all Electronic Chattel Paper held or owned by such Assignor.  Furthermore, if requested by the Collateral Trustee, each Assignor shall promptly take all actions which are reasonably practicable so that the Collateral Trustee has “control” of all Electronic Chattel Paper in accordance with the requirements of Section 9-105 of the UCC (unless the ABL Collateral Agent is granted a prior security interest in such Electronic Chattel Paper and the same is required to be subject to the “control” (in accordance with the requirements of Section 9-105 of the UCC) of the ABL Collateral Agent pursuant to the Intercreditor Agreement).  Each Assignor will promptly (and in any event within 10 days) following any request by the Collateral Trustee, deliver all of its Tangible Chattel Paper to the Collateral Trustee (unless the ABL Collateral

 

 

Agent is granted a prior security interest in such Tangible Chattel Paper and the same are required to be delivered (and are delivered) to the ABL Collateral Agent for the benefit of the holders of ABL Debt Obligations pursuant to the Intercreditor Agreement).

 

3.13   Further Actions .  Each Assignor will, at its own expense, make, execute, endorse, acknowledge, file and/or deliver to the Collateral Trustee from time to time such vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, certificates, reports and other assurances or instruments (unless the ABL Collateral Agent is granted a prior security interest in such certificates and instruments and the same are required to be delivered (and are delivered) to the ABL Collateral Agent for the benefit of the holders of ABL Debt Obligations pursuant to the Intercreditor Agreement) and take such further steps, including any and all actions as may be necessary or required under the Federal Assignment of Claims Act, relating to its Accounts, Contracts, Instruments and other property or rights covered by the security interest hereby granted, as the Collateral Trustee may reasonably require.

 

ARTICLE IV

 

SPECIAL PROVISIONS CONCERNING TRADEMARKS AND DOMAIN NAMES

 

Each Assignor represents, warrants and covenants, which representations, warranties and covenants shall survive execution and delivery of this Agreement, as follows:

 

4.1   Additional Representations and Warranties .  (a) Schedule 6A of the Perfection Certificate sets forth a true, complete and accurate list of all (i) United States, state and foreign registrations of and applications for registration of Marks and Domain Names owned by an Assignor, and (ii) Mark Licenses that are material to the business of any Assignor;

 

(b)           It is the sole, exclusive, true and lawful beneficial and record owner of the Marks and Domain Names listed in Schedule 6A of the Perfection Certificate for such Assignor, free and clear of all Liens (other than, in the case of Marks and Domain Names that are not material, Permitted Liens);

 

(c)           It owns or otherwise has the valid right to use all Marks and Domain Names used in or necessary to conduct the business of such Assignor, free and clear of all Liens (other than, in the case of Marks and Domain Names that are not material, Permitted Liens);

 

(d)           Except as set forth on Schedule 4.1(d), to such Assignor’s knowledge, the conduct of such Assignor’s business as currently conducted and contemplated to be conducted does not infringe upon, dilute, misappropriate or otherwise violate any Mark or Domain Name rights of any third party, in any material respect, and no such unresolved claim has been made or is pending against such Assignor that the use of any Mark or Domain Name owned or used by such Assignor infringes upon, dilutes, misappropriates or otherwise violates the Mark or Domain Name rights of any third party, and to the best of such Assignor’s knowledge, no such claim is threatened against such Assignor;

 

 

 

(e)           Except as set forth on Schedule 4.1(e), all registrations and applications for Marks and Domain Names listed in Schedule 6A of the Perfection Certificate are subsisting, have not been canceled (in whole or in part) and, to such Assignor’s knowledge, are valid; such Assignor has not received and is not aware of any third party claim that any of such registrations or applications is invalid or unenforceable; and such Assignor not aware of any reason for any such claim or that any of such applications material to the business of an Assignor will not mature into registrations;

 

(f)           It has performed all acts and has paid all renewal, maintenance, and other fees and taxes required to maintain each registration and application for the Marks and Domain Names listed in Schedule 6A of the Perfection Certificate in full force and effect (other than any such Marks and Domain Names which are, in such Assignor’s reasonable good faith opinion, no longer used or useful in its business or operations);

 

(g)           The Marks and Domain Names included in the Collateral are valid and enforceable; no holding, decision, or judgment has been rendered in any action or proceeding before any court or administrative authority challenging the validity of such Assignor’s right to register, or such Assignor’s rights to own or use, any such Marks or Domain Names; and no such action or proceeding is pending or, to such Assignor’s knowledge, threatened;

 

(h)           It uses (1) appropriate statutory notice of registration in connection with its use of registered Marks material to the business of an Assignor, and (2) consistent standards of quality in the manufacture, distribution, and sale of all products sold and in the provision of all services rendered under or in connection with any Mark included in the Collateral and has taken all actions necessary to ensure that all licensees of such Marks which are owned by such Assignor adhere to such Assignor’s standards of quality;

 

(i)           Except as set forth on Schedule 4.1(i), to such Assignor’s knowledge, no third party is materially infringing upon, diluting or otherwise violating any Marks or Domain Names owned or used by an Assignor;

 

(j)           Except as set forth on Schedule 4.1(j), there are no Mark Licenses, settlements or consents, covenants not to sue, non-assertion assurances, or releases to which any Assignor is a party or otherwise bound, that materially and adversely affects Assignor’s rights to own or use any Mark or Domain Name included in the Collateral; and

 

(k)           There is no effective financing statement or other document or instrument now executed, or on file or recorded in any public office, granting a security interest in or otherwise encumbering any part of the Marks or Domain Names included in the Collateral, other than Permitted Liens and those in favor of the Collateral Trustee.

 

4.2   Licenses and Assignments .  (a)  Except as otherwise permitted by the Secured Debt Documents, such Assignor shall not (i) divest itself of any right under any Mark or Domain Name included in the Collateral that is material to the Assignor’s business absent prior written approval of the Collateral Trustee (or as directed by an Act of Required Debtholders), (ii) grant a license to any Mark or Domain Name included in the Collateral without written consent of Collateral Trustee (or as directed by an Act of Required Debtholders), which shall not be unreasonably withheld, conditioned or delayed, other than licenses which are Permitted Liens, nor (iii) consent to amend, without written consent of Collateral Trustee (or as directed by an Act of Required Debtholders), which shall not be

 

 

unreasonably withheld, conditioned or delayed, any Mark License in a manner that materially and adversely affects the right of such Assignor to receive payments thereunder, or in any manner that would materially impair the value of any Mark or Domain Name included in the Collateral or the security interest in any such Mark or Domain Name created hereby.  Such Assignor shall secure all consents and approvals necessary for the grant of a security interest therein to the Collateral Trustee of any material Mark License entered into after the Closing Date (and the exercise of Collateral Trustee’s rights hereunder with respect thereto).

 

(b)           To the knowledge of such Assignor, each material Mark License is valid, binding and in full force and effect, and such Assignor is not in material breach or default and no event has occurred that, with notice and/or lapse of time, would constitute such a breach or default or permit termination, modification or acceleration under any such Mark License.  No party to any such Mark License has given such Assignor notice of a material breach or default under any such Mark License, which breach or default has not been cured, or of its intention to terminate or cancel any such Mark License.  None of the material Mark Licenses set forth on Schedule 6A of the Perfection Certificate constitute Excluded Assets or require any consent for the grant of the security interest in the Assignor’s rights under such Mark License granted hereunder (and the exercise of Collateral Trustee’s rights hereunder with respect thereto).

 

4.3   Infringements .  Such Assignor shall, at its own cost and expense, promptly upon learning thereof, notify the Collateral Trustee in writing of the name and address of, and furnish such pertinent information that may be available with respect to, any party who such Assignor believes is, or may be, infringing, diluting or otherwise violating any of such Assignor’s rights in and to any Mark or Domain Name in any material respect, or with respect to any party claiming that such Assignor’s use of any Mark or Domain Name used in such Assignor’s business violates in any material respect any property right of that party.  Such Assignor shall, at its own cost and expense, (1) prosecute diligently in accordance with reasonable business practices any Person infringing, diluting or otherwise violating any Mark or Domain Name that is material to an Assignor’s business, including but not limited to commencement of a suit, and (2) not settle or compromise any pending or future litigation or administrative proceeding with respect to any Mark or Domain Name that is material to an Assignor’s business, except as shall be consistent with reasonable business practices.

 

4.4   Preservation of Marks and Domain Names .  Such Assignor shall, at its own cost and expense, use its Marks and Domain Names which are material to an Assignor’s business in interstate commerce during the time in which this Agreement is in effect and to take all such other actions as are reasonably necessary to preserve such Marks as trademarks or service marks under the laws of the United States (other than any such Marks and Domain Names which are, in such Assignor’s reasonable good faith opinion, no longer used or useful in its business or operations).  Such Assignor shall, at its own cost and expense, maintain the level of quality of products sold and services rendered under any Marks owned by such Assignor at a level at least consistent with the quality of such products and services as of the date hereof, and adequately control the quality of goods and services offered by any licensees of its Marks to maintain such

 

 

standards.  Such Assignor shall use appropriate statutory notice of registration in connection with its use of registered Marks owned by an Assignor.

 

4.5   Maintenance of Registration .  At its own cost and expense, such Assignor shall diligently process all documents and take all other steps reasonably necessary to maintain all Mark and Domain Name registrations (other than any such Marks which are, in such Assignor’s reasonable good faith opinion, no longer used or useful in its business or operations) included in the Collateral (and to maintain and pursue all applications for registrations of all such Marks and Domain Names), including but not limited to submitting affidavits of use and applications for renewals of registration in the United States Patent and Trademark Office (or any similar office or agency in any other country or political subdivision thereof) for all registrations and applications for Marks, and shall pay all fees and disbursements in connection therewith and shall not abandon any such filing of affidavit of use or any such application of renewal prior to the exhaustion of all administrative and judicial remedies without prior written consent of the Collateral Trustee, or as directed by an Act of Required Debtholders (other than with respect to registrations and applications which are no longer used or useful in its business or operations in any material respect).  Such Assignor shall not knowingly do any act or omit to do any act that results in any of the Marks or Domain Names it owns that are material to an Assignor’s business lapsing, or becoming abandoned, dedicated to the public, forfeited or unenforceable, or which would materially adversely affect the validity, grant, or enforceability of the security interest therein granted to Collateral Trustee hereunder.

 

4.6   Notice of Proceedings .  Promptly following its becoming aware thereof, such Assignor shall, at its own cost and expense, notify the Collateral Trustee of (a) the institution of any proceeding in any court or administrative body or in the United States Patent and Trademark Office (or any similar office or agency in any other country or political subdivision thereof), or any adverse determination in any such proceeding (other than routine office actions or other determinations in the ordinary course of prosecution before the United States Patent and Trademark Office (or any similar office or agency in any other country or political subdivision thereof), regarding the validity or enforceability of any material Mark or Domain Name included in Collateral, or such Assignor’s right to register, own or use such Mark or Domain Name; or (b) any event which may be reasonably expected to materially and adversely affect the rights and remedies of the Collateral Trustee in relation thereto.

 

4.7   Prosecution of Mark Applications .  At its own cost and expense, such Assignor shall reasonably and diligently prosecute all material applications for Marks listed in Schedule 6A of the Perfection Certificate for such Assignor and shall not abandon any such application prior to exhaustion of all administrative and judicial remedies without prior written consent of the Collateral Trustee (other than applications that are deemed by such Assignor in its reasonable business judgment to no longer be necessary or advisable in the conduct of such Assignor’s business).

 

4.8   Future Acquired Marks and Domain Names .  If any Assignor shall, at any time after the date hereof, obtain any ownership or other rights in and to any additional Marks or Domain Names, then the provisions of this Agreement shall automatically apply thereto and any such Marks and Domain Names (other than any Excluded Assets) shall automatically constitute Collateral and shall be subject to the security interest created by this Agreement, without further

 

 

action by any party.  Such Assignor shall, at its own cost and expense, promptly, but in no event later than ninety (90) days from such Assignor obtaining such ownership or other rights, provide to the Collateral Trustee written notice of any such additional Marks or Domain Names which are the subject of a registration or application (including Marks and Domain Names which were theretofore unregistered and become the subject of a registration or application) and deliver to the Collateral Trustee the applicable Intellectual Property Security Agreement, or such other instrument in form and substance reasonably acceptable to the Collateral Trustee, and undertake the filing of any instruments or statements as shall be reasonably necessary to create, record, preserve, protect or perfect the Collateral Trustee’s security interest in such Collateral in the United States and any foreign jurisdiction reasonably requested by the Collateral Trustee.  Further, such Assignor authorizes the Collateral Trustee to deliver a Perfection Certificate Supplement amending Schedule 6A of the Perfection Certificate to include any such applications or registrations for Marks or Domain Names (but the failure to so deliver a Perfection Certificate Supplement shall not be deemed to affect the Collateral Trustee’s security interest in such Collateral).

 

4.9   Remedies .  (a)  Subject to the Intercreditor Agreement, the Collateral Trust Agreement and the other Secured Debt Documents, if an Event of Default shall occur and be continuing, the Collateral Trustee shall have the right, but shall in no way be obligated, to take any or all of the following actions: (i) declare the entire right, title and interest of such Assignor in and to each of the Marks and Domain Names included in the Collateral, together with all trademark rights and rights of protection to the same, vested in the Collateral Trustee for the benefit of the Secured Parties, in which event such rights, title and interest shall immediately vest, in the Collateral Trustee for the benefit of the Secured Parties, and the Collateral Trustee shall be entitled to exercise the power of attorney referred to in Section 1.2 to execute, cause to be acknowledged and notarized and record such absolute assignment with the applicable agency or registrar; (ii) take and use or sell the Marks or Domain Names and the goodwill of such Assignor’s business connected with the use of or symbolized by the Marks or Domain Names and the right to carry on the business and use the assets of such Assignor in connection with which the Marks or Domain Names have been used; and (iii) direct such Assignor to refrain, in which event such Assignor shall refrain, from using the Marks or Domain Names in any manner whatsoever, directly or indirectly, and such Assignor shall execute such further documents that the Collateral Trustee may reasonably request to further confirm this and to transfer ownership of the Marks or Domain Names and registrations and any pending trademark applications in the United States Patent and Trademark Office (or any similar office or agency in any other country or political subdivision thereof) or applicable Domain Name registrar to the Collateral Trustee, and record the same.

 

(b)           If an Event of Default shall occur and be continuing, the Collateral Trustee shall have the right, but shall in no way be obligated, to file applications for protection of the Intellectual Property included in the Collateral and/or bring suit in the name of any Assignor, the Collateral Trustee or the Secured Parties, to enforce the Marks and Domain Names included in the  Collateral.  In the event of such suit, such Assignor shall, at the request of the Collateral Trustee, do any and all lawful acts, including joinder as a party, and execute any and all documents requested by the Collateral Trustee in aid of such enforcement, and the Assignors shall promptly reimburse and indemnify the Collateral Trustee for all reasonable out-of-pocket costs and expenses (including reasonable attorney’s fees and expenses) incurred by the Collateral

 

 

Trustee in the exercise of its rights under this Section 4.9(b).  In the event that the Collateral Trustee shall elect not to bring suit to enforce any such Marks or Domain Names, such Assignor shall, at the request of the Collateral Trustee and at its own cost and expense, take all actions reasonably necessary, whether by suit, proceeding or other action, to prevent and/or obtain a recovery for the infringement, dilution or other violation of rights in, diminution in value of, or other damage to any of such Marks or Domain Names by any person.

 

ARTICLE V

 

SPECIAL PROVISIONS CONCERNING PATENTS, COPYRIGHTS AND TRADE SECRETS

 

5.1   Additional Representations and Warranties .  Each Assignor represents, warrants and covenants, which representations, warranties and covenants shall survive execution and delivery of this Agreement, as follows:

 

(a)           Schedule 6B and Schedule 6C of the Perfection Certificate sets forth a true, complete and accurate list of all (i) United States and foreign issued Patents, Patent applications, and Copyright registrations owned by an Assignor, (ii) Patent Licenses and Copyright Licenses that are material to the business of any Assignor;

 

(b)           It is the sole, exclusive, true and lawful beneficial and record owner of the Patents and Copyrights listed in Schedule 6B and Schedule 6C of the Perfection Certificate for such Assignor, free and clear of all Liens (other than, in the case of Patents and Copyrights that are not material, Permitted Liens);

 

(c)           It owns or otherwise has the valid right to use all Patents, Copyrights, Trade Secrets and other Intellectual Property used in or necessary to conduct the business of such Assignor, free and clear of all Liens (other than Permitted Liens);

 

(d)           Except as set forth on Schedule 5.1(d), to such Assignor’s knowledge, the conduct of such Assignor’s business as currently conducted and contemplated to be conducted does not infringe upon, misappropriate or otherwise violate any Intellectual Property rights of any third party, in any material respect, and no such unresolved claim has been made or is pending against such Assignor that the use of any Patents, Copyrights, Trade Secrets or other Intellectual Property owned or used by such Assignor infringes upon, misappropriates or otherwise violates the Intellectual Property rights of any third party, and to the best of such Assignor’s knowledge, no such claim is threatened against such Assignor;

 

(e)           Except as set forth on Schedule 5.1(e), all Copyright registrations, issued Patents and Patent applications listed in Schedule 6B and Schedule 6C of the Perfection Certificate are subsisting, have not been canceled (in whole or in part) and, to such Assignor’s knowledge, are valid; such Assignor has not received and is not aware of any third party claim that any of such registrations or applications is invalid or unenforceable; and such Assignor is not aware of any reason for any such claim or that any of such applications material to the business of an Assignor will not mature into registrations;

 

(f)           It has performed all acts and has paid all renewal, maintenance, and other fees and taxes required to maintain each Copyright registration, issued Patent and Patent

 

 

application listed in Schedule 6B and Schedule 6C of the Perfection Certificate in full force and effect (other than any such Copyrights, Patents and Patent applications which are, in such Assignor’s reasonable good faith opinion, no longer used or useful in its business or operations);

 

(g)           The Patents, Copyrights and Trade Secrets included in the Collateral are valid and enforceable; no holding, decision, or judgment has been rendered in any action or proceeding before any court or administrative authority challenging the validity of, such Assignor’s right to register, or such Assignor’s rights to own or use, any such Patents, Copyrights or Trade Secrets; and no such action or proceeding is pending or, to such Assignor’s knowledge, threatened;

 

(h)           It uses proper marking practices in connection with the use of Patents material to the business of an Assignor, and appropriate notice of copyright in connection with the publication of Copyrights material to the business of an Assignor;

 

(i)           It uses commercially reasonable steps to protect the confidentiality of its Trade Secrets;

 

(j)           Except as set forth on Schedule 5.1(j), to such Assignor’s knowledge, no third party is materially infringing upon, misappropriating or otherwise violating any Intellectual Property owned or used by an Assignor;

 

(k)           Except as set forth on Schedule 5.1(k), there are no Patent Licenses, Copyright Licenses, Trade Secret Licenses or consents, covenants not to sue, non-assertion assurances, or releases to which any Assignor is a party or otherwise bound that materially and adversely affects Assignor’s rights to own or use any Intellectual Property included in the Collateral; and

 

(l)           There is no effective financing statement or other document or instrument now executed, or on file or recorded in any public office, granting a security interest in or otherwise encumbering any part of the Intellectual Property included in the Collateral, other than Permitted Liens and those in favor of the Collateral Trustee.

 

5.2   Licenses and Assignments .  (a)  Except as otherwise permitted by the Secured Debt Documents, such Assignor shall not (i) divest itself of any right under any Patent or Copyright included in the Collateral that is material to such Assignor’s business absent prior written approval of the Collateral Trustee, (ii) grant a license to any Intellectual Property included in the Collateral without written consent of Collateral Trustee (or as directed by an Act of Required Debtholders), which shall not be unreasonably withheld, conditioned or delayed, other than licenses which are Permitted Liens, nor (iii) consent to amend, without consent of Collateral Trustee (or as directed by an Act of Required Debtholders), which shall not be unreasonably withheld, conditioned or delayed, any Patent License, Copyright License or Trade Secret License in a manner that materially and adversely affects the right of such Assignor to receive payments thereunder, or in any manner that would materially impair the value of any Intellectual Property included in the Collateral or the security interest in any such Intellectual Property created hereby.  Such Assignor shal