Attached files
| file | filename |
|---|---|
| 8-K - EASYLINK SERVICES INTERNATIONAL CORP | v199614_8k.htm |
| EX-10.4 - EX-10.4 - EASYLINK SERVICES INTERNATIONAL CORP | v199614_ex10-4.htm |
| EX-10.3 - EX-10.3 - EASYLINK SERVICES INTERNATIONAL CORP | v199614_ex10-3.htm |
| EX-10.9 - EX-10.9 - EASYLINK SERVICES INTERNATIONAL CORP | v199614_ex10-9.htm |
| EX-10.6 - EX-10.6 - EASYLINK SERVICES INTERNATIONAL CORP | v199614_ex10-6.htm |
| EX-99.1 - EASYLINK SERVICES INTERNATIONAL CORP | v199614_ex99-1.htm |
| EX-10.1 - EX-10.1 - EASYLINK SERVICES INTERNATIONAL CORP | v199614_ex10-1.htm |
| EX-10.7 - EX-10.7 - EASYLINK SERVICES INTERNATIONAL CORP | v199614_ex10-7.htm |
| EX-10.2 - EX-10.2 - EASYLINK SERVICES INTERNATIONAL CORP | v199614_ex10-2.htm |
| EX-10.5 - EX-10.5 - EASYLINK SERVICES INTERNATIONAL CORP | v199614_ex10-5.htm |
EXHIBIT
10.8
Execution
Version
SECURITY
AGREEMENT
THIS
SECURITY AGREEMENT (this “Agreement”), dated as
of October 21, 2010, by and among EASYLINK SERVICES INTERNATIONAL CORPORATION, a
Delaware corporation (the “Borrower”), the
subsidiaries of the Borrower signatory hereto and each other subsidiary of the
Borrower hereafter a party hereto (Borrower, each subsidiary of the Borrower a
party hereto and each other subsidiary hereafter becoming a party hereto shall
be collectively known as the “Grantors”, and
individually as a “Grantor”), in favor
of SUNTRUST BANK, in its capacity as the administrative agent (the “Administrative
Agent”), for the several banks and other financial institutions and
lenders (the “Lenders”) from time
to time party to the Revolving Credit and Term Loan Agreement, dated as of the
date hereof, by and among the Borrower, the Administrative Agent, the Lenders,
and SunTrust Bank, as Issuing Bank and as the Swingline Lender (as amended,
restated, supplemented, or otherwise modified from time to time, the “Credit
Agreement”).
WITNESSETH:
WHEREAS,
pursuant to the Credit Agreement, the Lenders have agreed to establish a
revolving credit facility in favor of and extend term loans to the Borrower;
and
WHEREAS,
it is a condition precedent to the obligations of the Administrative Agent, the
Issuing Bank, the Swingline Lender and the Lenders under the Credit Agreement
that the Grantors enter into this Agreement to secure the Secured Obligations
(as hereinafter defined), and the Grantors desire to satisfy such condition
precedent.
NOW,
THEREFORE, in consideration of the premises and mutual covenants herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
SECTION 1. Definitions. Capitalized terms defined in
the Credit Agreement and not otherwise defined herein, when used in this
Agreement shall have the respective meanings provided for in the Credit
Agreement. The following additional terms, when used in this Agreement, shall
have the following meanings:
“Account Debtor” shall
mean any person or entity that is obligated under an Account.
1
“Accounts” shall mean
all “accounts” (as defined in the UCC) now owned or hereafter acquired by any
Grantor or in which any Grantor has or acquires any rights, and, in any event,
shall mean and include, without limitation, (a) all accounts receivable,
contract rights, book debts, notes, drafts and other obligations or indebtedness
owing to any Grantor arising from the sale or lease of goods or other property
by any Grantor or the performance of services by any Grantor (including, without
limitation, any such obligation which might be characterized as an account,
contract right or general intangible under the UCC in effect in any
jurisdiction), (b) all of each Grantor’s rights in, to and under all
purchase and sales orders for goods, services or other property, and all of each
Grantor’s rights to any goods, services or other property represented by any of
the foregoing (including returned or repossessed goods and unpaid sellers’
rights of rescission, replevin, reclamation and rights to stoppage in transit),
(c) all monies due to or to become due to any Grantor under all contracts
for the sale, lease or exchange of goods or other property or the performance of
services by any Grantor (whether or not yet earned by performance on the part of
such Grantor), and (d) all collateral security and guarantees of any kind
given to any Grantor with respect to any of the foregoing.
“Chattel Paper” shall
mean all “chattel paper” (as defined in the UCC) owned or acquired by any
Grantor or in which any Grantor has or acquires any rights.
“Collateral” shall
mean, collectively, all of the following:
|
|
(i)
|
all
Accounts;
|
|
|
(ii)
|
all
Chattel Paper;
|
|
|
(iii)
|
all
Deposit Accounts;
|
|
|
(iv)
|
all
Documents;
|
|
|
(v)
|
all
Equipment;
|
|
|
(vi)
|
all
Fixtures;
|
|
|
(vii)
|
all
General Intangibles;
|
|
|
(viii)
|
all
Instruments;
|
|
|
(ix)
|
all
Inventory;
|
|
|
(x)
|
all
Investment Property;
|
|
|
(xi)
|
all
money, cash or cash equivalents;
|
|
(xii)
|
all other goods and personal property, whether tangible
orintangible;
|
|
(xiii)
|
all Supporting Obligations and Letter-of-Credit Rights of any
Grantor;
|
|
|
(xiv)
|
all
books and records pertaining to any of the Collateral (including, without
limitation, credit files, Software, computer programs, printouts and other
computer materials and records but excluding customer lists);
and
|
|
|
(xv)
|
All
products and Proceeds of all or any of the Collateral described in clauses
(i) through (xiv) hereof.
|
2
Notwithstanding
the foregoing, the “Collateral” shall expressly exclude all Excluded
Assets.
“Copyright License”
shall mean any and all rights of any Grantor under any written agreement
granting any right to use any Copyright or Copyright registration.
“Copyrights” shall
mean all of the following now owned or hereafter acquired by any Grantor or in
which any Grantor now has or hereafter acquires any rights: (a) all copyrights
and general intangibles of like nature (whether registered or unregistered), all
registrations and recordings thereof, and all applications in connection
therewith, including all registrations, recordings and applications in the
United States Copyright Office or in any similar office or agency of the United
States, any state or territory thereof, or any other country or any political
subdivision thereof, and (b) all reissues, extensions or renewals
thereof.
“Deposit Accounts”
shall mean all “deposit accounts” (as defined in the UCC) now owned or hereafter
acquired by any Grantor or in which any Grantor has or acquires any rights, or
other receipts, of any Grantor covering, evidencing or representing rights or
interest in such deposit accounts.
“Documents” shall mean
all “documents” (as defined in the UCC) now owned or hereafter acquired by any
Grantor or in which any Grantor has or acquires any rights, or other receipts,
of any Grantor covering, evidencing or representing goods.
“Equipment” shall mean
all “equipment” (as defined in the UCC) now owned or hereafter acquired by any
Grantor and wherever located, and, in any event, shall include without
limitation all machinery, furniture, furnishings, processing equipment,
conveyors, machine tools, engineering processing equipment, manufacturing
equipment, materials handling equipment, trade fixtures, trucks, trailers,
forklifts, vehicles, computers and other electronic data processing and other
office equipment of any Grantor, and any and all additions, substitutions and
replacements of any of the foregoing, together with all attachments, components,
parts, equipment and accessories installed thereon or affixed thereto, all fuel
therefore and all manuals, drawings, instructions, warranties and rights with
respect thereto.
“Event of Default”
shall have the meaning set forth for such term in Section 7 hereof.
“Excluded
Accounts” shall mean (i) any Deposit Account maintained exclusively to fund
taxes, payroll obligations, workers’ compensation, employee benefit plans and
other similar fiduciary accounts, and (ii) any Deposit Accounts established
exclusively as escrow accounts.
“Excluded Assets”
shall mean the following assets and properties in which any Grantor has any
right, title or interest:
(i) any
shares of Capital Stock or other equity interests issued by any Subsidiary that
is not a Domestic Subsidiary in excess of 65% of all issued and outstanding
shares of all classes of Capital Stock or other equity interests of such
Subsidiary;
3
(ii) Equipment
that is subject to a “purchase money security interest,” as such term is now or
hereafter defined in the UCC, which (x) constitutes a Permitted Lien under the
Credit Agreement and (y) prohibits the creation by such Grantor of a junior
security interest therein, provided, however, that the foregoing exclusion shall
not apply if (a) such prohibition has been waived or such other person has
otherwise consented to the creation hereunder of a security interest in such
Equipment; or (b) such prohibition would be rendered ineffective pursuant to
Section 9-406 of the UCC or Sections 9-407 or 9-408 of the UCC, as applicable
and as then in effect in any relevant jurisdiction, or any other applicable law
(including applicable bankruptcy and insolvency law or principles of equity)
provided further that immediately upon the ineffectiveness, lapse or termination
of such prohibition, the term “Collateral” shall include, and the applicable
Grantor shall be deemed to have granted a security interest in, all its rights,
title and interests in and to such Equipment as if such prohibition had never
been in effect;
(iii) any
property to the extent that the grant of a security interest therein would
violate applicable law, require a consent not obtained of any governmental
authority, or constitute a breach of or default under, or result in the
termination of or require a consent not obtained under, any contract, lease,
license or other agreement evidencing or giving rise to such property, or result
in the invalidation thereof or provide any party thereto with a right of
termination, provided, however, that the foregoing exclusion shall not apply if
(a) such prohibition has been waived or such other person has otherwise
consented to the creation hereunder of a security interest in such property, or
(b) such prohibition would be rendered ineffective to prevent the attachment of
the security interest granted hereunder pursuant to Section 9-406 of the UCC or
Sections 9-407, 9-408 or 9-409 of the UCC, as applicable and as then in effect
in any relevant jurisdiction, or any other applicable law (including applicable
bankruptcy and insolvency law or principles of equity); provided further that
immediately upon the ineffectiveness, lapse or termination of any such
provision, the term “Collateral” shall include, and the applicable Grantor shall
be deemed to have granted a security interest in, all its rights, title and
interests in and to such property as if such provision had never been in effect;
and provided further that the foregoing exclusion shall in no way be construed
so as to limit, impair or otherwise affect the Secured Party’s unconditional
continuing security interest in and to all rights, title and interests of any
Grantor in or to any payment obligations or other rights to receive monies due
or to become due under any such property and in any such monies and other
Proceeds, including without limitation Accounts, General Intangibles and
proceeds of Proceeds, of such property;
(iv) any
Intellectual Property to the extent the creation of a security interest therein
or the grant of a mortgage thereon would void or invalidate such Intellectual
Property or such Grantor’s interest therein; or
(v) Excluded
Accounts;
(vi) motor
vehicles and other assets subject to certificates of title to the extent that a
Lien therein cannot be perfected by the filing of UCC financing statements in
the jurisdictions of organization of the Grantor with rights in such
asset;
4
provided
that, in the case of clauses (i) through (vi) immediately preceding, all
Proceeds of such property shall always be included in the Collateral and the
Administrative Agent’s security interest granted by the Grantors hereunder shall
attach at all times to such Proceeds.
“Fixtures” shall mean
all “fixtures” (as defined in the UCC) now owned or hereafter acquired by any
Grantor and wherever located.
“General Intangibles”
shall mean all “general intangibles” (as defined in the UCC) now owned or
hereafter acquired by any Grantor or in which any Grantor has or acquires any
rights and, in any event, shall include all right, title and interest in or
under all Purchase Transaction Documents, all contracts, all customer lists,
Licenses, Copyrights, Trademarks, Patents, and all applications therefor and
reissues, extensions or renewals thereof, rights in Intellectual Property,
interests in partnerships, joint ventures and other business associations,
licenses, permits, copyrights, trade secrets, proprietary or confidential
information, inventions (whether or not patented or patentable), technical
information, procedures, designs, knowledge, know-how, software, data bases,
data, skill, expertise, experience, processes, models, drawings, materials and
records, goodwill (including the goodwill associated with any Trademark or
Trademark License), all rights and claims in or under insurance policies
(including insurance for fire, damage, loss and casualty, whether covering
personal property, real property, tangible rights or intangible rights, all
liability, life, key man and business interruption insurance, and all unearned
premiums), uncertificated securities, choses in action, deposits, checking and
other bank accounts, rights to receive tax refunds and other payments, rights of
indemnification or warranty, all books and records, correspondence, credit
files, invoices, tapes, cards, computer runs, domain names, prospect lists,
customer lists and other papers and documents.
“Instruments” shall
mean all “instruments” (as defined in the UCC) now owned or hereafter acquired
by any Grantor or in which any Grantor has or acquires any rights and, in any
event, shall include all promissory notes, all certificates of deposit and all
letters of credit evidencing, representing, arising from or existing in respect
of, relating to, securing or otherwise supporting the payment of, any of the
Accounts or other obligations owed to any Grantor.
“Intellectual
Property” shall mean all of the following now owned or hereafter acquired
by any Grantor or in which any Grantor has or acquires any rights: (a) all
Patents, patent rights and patent applications, Copyrights and copyright
applications, Trademarks, trademark rights, trade names, trade name rights,
service marks, service mark rights, applications for registration of trademarks,
trade names and service marks, fictitious names registrations and trademark,
trade name and service mark registrations, mask works or similar rights, any and
all claims for damages by way of past, present or future infringement of any of
the rights included above, with the right, but not the obligation, to sue for
and collect such damages for said use or infringement and all derivations
thereof (including, without limitation, those Copyrights, Trademarks and Patents
listed on Schedule
IV hereto); and (b) Patent Licenses, Trademark Licenses, Copyright
Licenses and other licenses to use any of the items described in the preceding
clause (a), and any other items necessary to conduct or operate the business of
each Grantor.
“Inventory” shall mean
all “inventory” (as defined in the UCC) now owned or hereafter acquired by any
Grantor or in which any Grantor has or acquires any rights and, in any event,
shall include all goods owned or held for sale or lease to any other
Persons.
5
“Investment Property”
shall mean all “investment property” (as defined in the UCC) now owned or
hereafter acquired by any Grantor or in which any Grantor has or acquires any
rights and, in any event, shall include all “certificated securities”,
“uncertificated securities”, “security entitlements”, “securities accounts”,
“commodity contracts” and “commodity accounts” (as all such terms are defined in
the UCC) of each Grantor.
“Letter-of-Credit
Rights” shall mean “letter-of-credit rights” (as defined in the UCC), now
owned or hereafter acquired by any Grantor, including rights to payment or
performance under a letter of credit, whether or not any Grantor, as
beneficiary, has demanded or is entitled to demand payment or
performance.
“License” shall mean
any Copyright License, Patent License, Trademark License or other license of
rights or interests of each Grantor in Intellectual Property.
“Patent License” shall
mean any written agreement now owned or hereafter acquired by any Grantor or in
which any Grantor has or acquires any rights granting any right with respect to
any property, process or other invention on which a Patent is in
existence.
“Patents” shall mean
all of the following now owned or hereafter acquired by any Grantor or in which
any Grantor has or acquires any rights: (a) all letters patent of the United
States or any other country, all registrations and recordings thereof, and all
applications for letters patent of the United States or any other country,
including registrations, recordings and applications in the United States Patent
and Trademark Office or in any similar office or agency of the United States,
any State or Territory thereof, or any other country; and (b) all reissues,
continuations, continuations-in-part and extensions thereof.
“Permitted Liens”
shall mean Liens expressly permitted under Section 7.2 of the Credit Agreement
or otherwise consented to in writing by the Required Lenders.
“Proceeds” shall mean
all “proceeds” (as defined in the UCC) of, and all other profits, rentals or
receipts, in whatever form, arising from the collection, sale, lease, exchange,
assignment, licensing or other disposition of, or realization upon, the
Collateral, and, in any event, shall mean and include all claims against third
parties for loss of, damage to or destruction of, or for proceeds payable under,
or unearned premiums with respect to, policies of insurance in respect of any
Collateral, and any condemnation or requisition payments with respect to any
Collateral and the following types of property acquired with cash proceeds:
Accounts, Inventory, General Intangibles, Documents, Instruments and
Equipment.
6
“Secured Obligations”
shall mean (i) all Obligations of the Borrower under the Credit Agreement and
the other Loan Documents (whether for principal, interest, fees, expenses,
indemnity or reimbursement payments, or otherwise), (ii) all obligations of the
Borrower, monetary or otherwise, pursuant to any Hedging Transaction incurred to
limit interest rate or fee fluctuation with respect to the Loans and Letters of
Credit entered into with a Specified Hedge Provider, (iii) all Treasury
Management Obligations owing to a Specified Treasury Management
Provider (whether for principal, interest, fees, expenses, indemnity or
reimbursement payments, or otherwise), (iv) all obligations of each other
Grantor under the Subsidiary Guaranty Agreement and all other Loan Documents to
which such other Grantor is a party to (whether for principal, interest, fees,
expenses, indemnity or reimbursement payments, or otherwise), (v) all renewals,
extensions, refinancings and modifications thereof, and (vi) all reasonable and
documented costs and expenses actually incurred by the Administrative Agent in
connection with the exercise of its rights and remedies hereunder (including
reasonable and documented out-of-pocket attorneys’ fees actually incurred).
Where the context requires, (i) any Affiliate of a Lender which is party to a
Hedging Transaction entered into to limit interest rate or fee fluctuations with
respect to the Loans and Letters of Credit shall be deemed to be a “Secured
Party” for purposes of this Agreement and such affiliate shall only be required
to be an Affiliate of a Lender at the time the relevant Hedging Transaction is
entered into in order for such Hedging Transaction to be eligible to be
designated as a “Secured Obligation”, and (ii) any Affiliate of a Lender which
provides Treasury Management Services to a Grantor shall be deemed to be a
“Secured Party” for purposes of this Agreement and such Affiliate shall only be
required to be an Affiliate of a Lender at the time the relevant agreement is
entered into in order for such Treasury Management Obligations to be eligible to
be designated as “Secured Obligations”.
“Secured Parties”
shall mean, collectively, the Administrative Agent, the Lenders, the Specified
Hedge Providers and the Specified Treasury Management Providers.
“Security Interests”
shall mean the security interests granted to the Administrative Agent on its
behalf and on behalf of the Secured Parties pursuant to Section 3, as well as
all other security interests created or assigned as additional security for the
Secured Obligations pursuant to the provisions of this Agreement.
“Software” shall mean
all “software” (as defined in the UCC), now owned or hereafter acquired by any
Grantor, including all computer programs and all supporting information provided
in connection with a transaction related to any program.
“Specified Hedge
Provider” shall mean each party to a Hedging Transaction entered into to
limit interest rate or fee fluctuations with respect to the Loans and Letters of
Credit if at the date of entering into such Hedging Transaction such person was
a Lender or an Affiliate of a Lender and such person executes and delivers to
the Administrative Agent a letter agreement in form and substance acceptable to
the Administrative Agent pursuant to which such person (i) appoints the
Administrative Agent as its agent under the applicable Loan Documents and (ii)
agrees to be bound by the provisions of Article IX and X of the Credit
Agreement.
“Specified Treasury
Management
Provider” shall mean any Lender or any Affiliate of a Lender that
provides to any Loan Party the services described in the definition of Treasury
Management Obligations if at the date of entering
into an agreement to provide such services such person was a Lender or an
Affiliate of a Lender and such person executes and delivers to the
Administrative Agent a letter agreement in form and substance acceptable to the
Administrative Agent pursuant to which such person (i) appoints the
Administrative Agent as its agent under the applicable Loan Documents and (ii)
agrees to be bound by the provisions of Article IX and X of the Credit
Agreement.
7
“Supporting
Obligations” means all “supporting obligations” (as defined in the UCC),
including letters of credit and guaranties issued in support of Accounts,
Chattel Paper, Documents, General Intangibles, Instruments, or Investment
Property.
“Trademark License”
shall mean any written agreement now owned or hereafter acquired by any Grantor
or in which any Grantor has or acquires any such rights granting to any Grantor
any right to use any Trademark.
“Trademarks” shall
mean all of the following now owned or hereafter acquired by any Grantor or in
which any Grantor has or acquires any such rights: (i) all trademarks, trade
names, corporate names, company names, business names, fictitious business
names, trade styles, service marks, logos, other source or business identifiers,
prints and labels on which any of the foregoing have appeared or appear, designs
and general intangibles of like nature (whether registered or unregistered), now
owned or existing or hereafter adopted or acquired, all registrations and
recordings thereof, and all applications in connection therewith, including,
without limitation, registrations, recordings and applications 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, (ii) all reissues, extensions or renewals thereof and (iii)
all goodwill associated with or symbolized by any of the foregoing.
“UCC” shall mean the
Uniform Commercial Code as in effect, from time to time, in the State of
Georgia; 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 is
governed by the Uniform Commercial Code as in effect in a jurisdiction other
than Georgia, “UCC” shall mean 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.
“United States” or
“U.S.” shall
mean the United States of America, any of the fifty states thereof, and the
District of Columbia.
SECTION 2. Representations
and Warranties.
Each Grantor represents and warrants to the Administrative Agent, for the
benefit of Secured Parties, as follows:
(a) Such
Grantor has rights in and the power to transfer each item of the Collateral upon
which it purports to grant a Lien hereunder and has good and marketable title to
all of its Collateral, free and clear of any Liens other than Permitted
Liens.
(b) Other
than financing statements, security agreements, or other similar or equivalent
documents or instruments with respect to Permitted Liens, no authorized and
effective financing statement, mortgage, security agreement or similar or
equivalent document or instrument evidencing a Lien on all or any part of the
Collateral is on file or of record in any jurisdiction. None of the Collateral
is in the possession of a Person (other than any Grantor) asserting any claim
thereto or security interest therein, except with respect to Permitted Liens and
except that the Administrative Agent or its designee may have possession of
Collateral as contemplated hereby.
8
(c) When
the UCC financing statements in appropriate form are filed in the offices
specified on Schedule
I attached hereto, the Security Interests shall constitute valid and
perfected security interests in the Collateral, prior to all other Liens and
rights of others therein except for Permitted Liens, to the extent that a
security interest therein may be perfected by filing pursuant to the UCC,
assuming the proper filing and indexing thereof.
(d) All
Inventory and Equipment is insured in accordance with the requirements of the
Credit Agreement.
(e) None
of the Collateral constitutes, or is the Proceeds of, “farm products” (as
defined in the UCC).
(f) Schedule II correctly
sets forth each Grantor’s state of incorporation, taxpayer identification
number, organizational identification number and correct legal name indicated on
the public record of such Grantor’s jurisdiction of organization which shows
such Grantor to be organized.
(g) The
Perfection Certificate, which is attached hereto as Schedule III,
correctly sets forth, as of the date thereof, (i) all names and tradenames that
each Grantor has used within the five year period ending on the date thereof and
the names of all Persons that have merged into or been acquired by each Grantor
within such five year period, (ii) the chief executive offices of each Grantor,
(iii) all other locations in which tangible assets of each Grantor are located,
(iv) the name of each bank at which each Grantor maintains Deposit Accounts
(other than Excluded Accounts) and the account numbers for each Deposit Account,
(v) all letters of credit under which each Grantor is a beneficiary, (vi) all
third parties with possession of any Inventory or Equipment of any Grantor in an
aggregate value exceeding $100,000 and (vii) each Grantor’s mailing
address.
(h) With
respect to material Accounts, except as specifically disclosed from time to time
to the Administrative Agent, (i) they represent in all material respects bona
fide sales of Inventory or rendering of services to Account Debtors in the
ordinary course of such Grantor’s business; (ii) there are no setoffs, claims or
disputes existing or asserted with respect thereto except as have arisen in the
ordinary course of business and such Grantor has not made any agreement with any
Account Debtor for any extension of time for the payment thereof, any compromise
or settlement for less than the full amount thereof, any release of any Account
Debtor from liability therefor, or any deduction therefrom except a discount or
allowance allowed by such Grantor in the ordinary course of its business for
prompt payment; and (iii) at the time that the account receivable constituting
such Account was originated, such Grantor has no knowledge that any Account
Debtor is unable generally to pay its debts as they become due. Further with
respect to the Accounts, to such Grantor’s knowledge, all Account Debtors have
the capacity to contract.
9
(i) With
respect to any material portion of Inventory, (i) such Inventory is located at
one of the Grantor’s locations set forth on the Perfection Certificate or at
another location identified in writing to the Administrative Agent, (ii) no
Inventory is now, or shall at any time or times hereafter be stored at any other
location without prior notice to the Administrative Agent, and such Grantor will
concurrently therewith obtain, subject to the post-closing periods and
requirements of the Credit Agreement, bailee, landlord and mortgagee agreements,
(iii) such Grantor has good, indefeasible and merchantable title to such
Inventory and such Inventory is not subject to any Lien or security interest or
document whatsoever except for the Lien granted to the Administrative Agent and
except for Permitted Liens, (iv) such Inventory is in all material respects of
good and merchantable quality, free from any defects, (v) such Inventory is not
subject to any licensing, patent, royalty, trademark, trade name or copyright
agreements with any third parties which would require any consent of any third
party upon sale or disposition of that Inventory or the payment of any monies to
any third party upon such sale or other disposition, and (vi) the completion of
manufacture, sale or other disposition of such Inventory by the Administrative
Agent following an Event of Default shall not require the consent of any Person
and shall not constitute a breach or default under any contract or agreement to
which such Grantor is a party or to which such property is subject.
(j) As
of the date hereof, such Grantor does not have any interest in, or title to, any
Patent, Trademark or Copyright except as set forth on Schedule IV hereto.
This Agreement is effective to create a valid and continuing Lien on and, upon
filing of this Agreement or an appropriate short form security instrument with
the United States Copyright Office and and the United States Patent and
Trademark Office, perfected security interests in favor of, the Administrative
Agent in such Grantor’s Patents, Trademarks and Copyrights and such perfected
security interests are enforceable as such as against any and all creditors of
and purchasers from such Grantor. Upon filing of this Agreement with the United
States Copyright Office and the United States Patent and Trademark Office and
the filing of appropriate financing statements listed on Schedule I hereto,
all action necessary or desirable to protect and perfect the Administrative
Agent’s Lien on such Grantor’s Patents, Trademarks or Copyrights shall have been
duly taken.
SECTION 3. The
Security Interests. In order to secure the full
and punctual payment and performance of the Secured Obligations in accordance
with the terms thereof, each Grantor hereby pledges, assigns, hypothecates, sets
over and conveys to the Administrative Agent on its behalf and on behalf of the
Secured Parties and grants to the Administrative Agent on its behalf and on
behalf of the Secured Parties a continuing security interest in and to, all of
its rights in and to all Collateral now or hereafter owned or acquired by such
Grantor or in which such Grantor now has or hereafter has or acquires any
rights, and wherever located. The Security Interests are granted as security
only and shall not subject the Administrative Agent or any other Secured Party
to, or transfer to the Administrative Agent or any other Secured Party, or in
any way affect or modify, any obligation or liability of the Grantor with
respect to any Collateral or any transaction in connection therewith.
Notwithstanding anything contained herein to the contrary, the Excluded Assets
shall be expressly excluded from the grant of security contemplated
herein.
SECTION 4. Further
Assurances; Covenants.
(a) General.
(i) No
Grantor shall change the location of its chief executive office or principal
place of business unless it shall have given the Administrative Agent prior
notice thereof, as well as executed and delivered to the Administrative Agent
all financing statements and financing statement amendments which the
Administrative Agent may reasonably request in connection therewith. No Grantor
shall change the locations, or establish new locations, where it keeps or holds
any material portion of the Collateral or any records relating thereto from the
applicable locations described in the Perfection Certificate attached hereto as
Schedule III
unless such Grantor shall have given the Administrative Agent prior notice of
such change of location. The foregoing covenant shall not apply to any
Collateral (including trucks) perfected by recordation of the Administrative
Agent’s Lien on the appropriate certificate of title.
10
(ii) No
Grantor shall change its name, organizational identification number, type of
entity, jurisdiction of organization or corporate structure in any manner (other
than as permitted under the Credit Agreement) unless it shall have given the
Administrative Agent at least ten (10) days prior written notice thereof, and
executed and delivered to the Administrative Agent all financing statements and
financing statement amendments which the Administrative Agent may reasonably
request in connection therewith. No Grantor shall merge or consolidate into, or
transfer any of the Collateral to, any other Person other than another Grantor,
without the prior written consent of the Required Lenders, other than as
permitted under the Credit Agreement.
(iii) Each
Grantor hereby authorizes the Administrative Agent, its counsel or its
representative, at any time and from time to time, to file financing statements
and amendments that describe the collateral covered by such financing statements
as “all assets of the Grantor”, “all personal property of the Grantor” or words
of similar effect, in such jurisdictions as the Administrative Agent may deem
necessary or desirable in order to perfect the security interests granted by
such Grantor under this Agreement. Each Grantor will, from time to time, at its
expense, execute, deliver, file and record any statement, assignment,
instrument, document, agreement or other paper and take any other action
(including, without limitation, any filings with the United States Patent and
Trademark Office, Copyright or Patent filings and any filings of financing or
continuation statements under the UCC) that from time to time the Administrative
Agent may request, in order to create, preserve, upgrade in rank (to the extent
required hereby), perfect, confirm or validate the Security Interests or to
enable the Administrative Agent to obtain the full benefits of this Agreement,
or to enable the Administrative Agent to exercise and enforce any of its rights,
powers and remedies hereunder with respect to any of its Collateral. Each
Grantor hereby authorizes the Administrative Agent to execute and file financing
statements, financing statement amendments or continuation statements on behalf
of such Grantor. Grantors shall pay the costs of, or incidental to, any
recording or filing of any financing statements, financing statement amendments
or continuation statements necessary in the sole discretion of the
Administrative Agent, to perfect the Administrative Agent and Secured Parties’
security interest in the Collateral. At any Grantor’s request, the
Administrative Agent shall take such actions as may be reasonably necessary to
indicate in such UCC Financing Statements or other filings that the Collateral
does not include any Excluded Assets.
11
(iv) Except
as set forth in the Perfection Certificate attached hereto as Schedule III, no
Grantor shall permit any material portion of its tangible assets, including
without limitation, its Inventory and Equipment, to be in the possession of any
other Person (other than assets in transit to a Grantor’s location or to a
customer and assets in the possession of third parties for repair) unless
pursuant to an agreement in form and substance satisfactory to the
Administrative Agent, pursuant to which (A) such Person has acknowledged that
(1) it holds possession of such Inventory, Equipment and other tangible assets,
as the case may be, for the Administrative Agent’s benefit, subject to the
Administrative Agent’s instructions, and (2) such Person does not have a Lien in
such Inventory, Equipment or other tangible assets, (B) such Person agrees not
to hold such Inventory, Equipment or other tangible assets on behalf of any
other Person and (C) such Person agrees that, after the occurrence and during
the continuance of an Event of Default and upon request by the Administrative
Agent to issue and deliver to the Administrative Agent warehouse receipts, bills
of lading or any similar documents relating to such Collateral in the
Administrative Agent’s name and in form and substance acceptable to the
Administrative Agent.
(v)
No Grantor shall (A) sell, transfer, lease, exchange,
assign or otherwise dispose of, or grant any option, warrant or other right with
respect to, any of its Collateral; or (B) create, incur or suffer to exist any
Lien with respect to any Collateral, in each case other than as permitted by the
Credit Agreement.
(vi) Each
Grantor will, promptly upon request, provide to the Administrative Agent all
information and evidence it may reasonably request concerning the Collateral, to
enable the Administrative Agent to enforce the provisions of this
Agreement.
(vii) Each
Grantor shall take all actions reasonably requested by the Administrative Agent
in order to maintain the perfected status of the Security
Interests.
(viii) No
Grantor shall file any amendment to or termination of a financing statement
naming any Grantor as debtor and the Administrative Agent as secured party, or
any correction statement with respect thereto, in any jurisdiction until such
time as the Secured Obligations have been satisfied and the Administrative Agent
and the Secured Parties have released their security interests granted
hereunder.
(ix) Each
Grantor shall take all steps requested by Administrative Agent to grant the
Administrative Agent control of all electronic chattel paper in accordance with
the UCC and all “transferable records” as defined in each of the Uniform
Electronic Transactions Act and the Electronic Signatures in Global and National
Commerce Act.
12
(b) Accounts,
Etc.
(i) Each
Grantor shall use all reasonable efforts consistent with prudent business
practice to cause to be collected from its Account Debtors, as and when due, any
and all amounts owing under or on account of each Account (including, without
limitation, Accounts which are delinquent, such Accounts to be collected in
accordance with lawful collection procedures) and apply forthwith upon receipt
thereof all such amounts as are so collected to the outstanding balance of such
Account. The costs and expenses (including, without limitation, reasonable
attorneys’ fees actually incurred) of collection of Accounts incurred by such
Grantor (or the Administrative Agent, during the existence of an Event of
Default) shall be borne by the Grantors.
(ii) Upon
the occurrence and during the continuance of any Event of Default, upon request
of the Administrative Agent, each Grantor will promptly notify (and each Grantor
hereby authorizes the Administrative Agent so to notify) each Account Debtor in
respect of any Account or Instrument that such Collateral has been assigned to
the Administrative Agent hereunder, and that any payments due or to become due
in respect of such Collateral are to be made directly to the Administrative
Agent or its designee.
(c) Equipment, Etc. Each
Grantor shall, (i) within ten (10) days after a written request by the
Administrative Agent, in the case of Equipment now owned, and (ii) following a
request by the Administrative Agent pursuant to subclause (i) above, within ten
(10) days after acquiring any other Equipment, deliver to the Administrative
Agent, any and all certificates of title, and applications therefor, if any, of
such Equipment and shall cause the Administrative Agent to be named as
lienholder on any such certificate of title and applications. No Grantor shall
permit any such items to become a fixture to real estate or an accession to
other personal property unless such real estate or personal property is the
subject of a fixture filing (as defined in the UCC) creating a first priority
perfected Lien in favor of the Administrative Agent.
(d) Patents, Trademarks,
Etc. Each Grantor shall notify the Administrative Agent immediately upon
the occurrence of each of the following (i) such Grantor’s acquisition after the
date of this Agreement of any material Intellectual Property and (ii) such
Grantor’s obtaining knowledge, or reason to know, that any application or
registration relating to any Intellectual Property owned by or licensed to such
Grantor is reasonably likely to become abandoned or dedicated, or of any
material adverse determination or development (including, without limitation,
the institution of, or any such determination or development in, any proceeding
in the United States Copyright Office, the United States Patent and Trademark
Office or any court) regarding such Grantor’s ownership of any material
Intellectual Property, its right to register the same, or to keep and maintain
the same; provided that no such notice need be delivered with respect to any
Intellectual Property that such Grantor has determined, in the exercise of its
reasonable judgment, is no longer used or useful in such Grantor’s
business.
13
(e) Deposit Accounts, Chattel
Paper, Investment Property and Letters of Credit.
(i) No
Grantor shall open or maintain any Deposit Accounts other than (1) Excluded
Accounts, (2) those listed on the Perfection Certificate attached hereto as
Schedule III,
and (3) such other Deposit Accounts as such Grantor shall open and maintain with
prior notice to the Administrative Agent subject to control agreements, in form
and substance satisfactory to the Administrative Agent in its sole discretion,
executed by such Grantor, the bank at which the deposit account is located and
the Administrative Agent.
(ii) No
Grantor shall become the beneficiary of any Letters of Credit in an amount in
excess of $250,000 unless, within ten (10) days of the issuance of such Letter
of Credit, the issuer of the Letter of Credit consents to the assignment of the
proceeds of such Letter of Credit to the Administrative Agent which consent
shall not be unreasonably withheld, such assignment to be in form and substance
acceptable to the Administrative Agent.
(iii) Each
Grantor, at any time and from time to time, will take such steps as the
Administrative Agent may reasonably request from time to time (a) for the
Administrative Agent to obtain “control” of any Investment Property (other than
Excluded Accounts) or electronic Chattel Paper, with any agreements establishing
control to be in form and substance reasonably satisfactory to the
Administrative Agent, and (b) otherwise to insure the continued perfection and
priority of the Administrative Agent’s security interest in any of the
Collateral and of the preservation of its rights therein.
(f) Commercial Tort
Claims. If any Grantor shall at any time acquire a “commercial tort
claim” (as such term is defined in the UCC) with a claim for damages that could
reasonably be expected to be in excess of $250,000, such Grantor shall promptly
notify the Administrative Agent thereof in a writing, providing a reasonable
description and summary thereof, and shall execute a supplement to this
Agreement granting a security interest in such commercial tort claim to the
Administrative Agent.
SECTION 5. Reporting
and Recordkeeping.
Each Grantor covenants and agrees with the Administrative Agent that from
and after the date of this Agreement and until the Secured Obligations have been
indefeasibly paid in full in cash:
(a) Maintenance of Records
Generally. Each Grantor will keep and maintain at its own cost and
expense records of its Collateral, complete in all material respects, including,
without limitation, a record of all payments received and all credits granted
with respect to the Collateral and all other dealings with its Collateral,
consistent with past practice. To the extent required by the Administrative
Agent, each Grantor will mark its books and records pertaining to its Collateral
to evidence this Agreement and the Security Interests. All Chattel Paper will be
marked with the following legend: “This writing and the obligations evidenced or
secured hereby are subject to the security interest of SunTrust Bank, as
Administrative Agent.” For the Administrative Agent’s further security, each
Grantor agrees that the Administrative Agent shall have a security interest in
all of such Grantor’s books and records pertaining to its Collateral and, upon
the occurrence and during the continuation of any Event of Default, such Grantor
shall deliver and turn over full and complete copies of any such books and
records to the Administrative Agent or to its representatives at any time on
demand of the Administrative Agent. Upon reasonable notice from the
Administrative Agent, and subject to the limitations set forth in the Credit
Agreement, each Grantor shall permit any representative of the Administrative
Agent, to inspect such books and records and will provide photocopies thereof to
the Administrative Agent.
14
(b) Special Provisions Regarding
Maintenance of Records and Reporting Re: Accounts, Inventory and
Equipment.
(i) Each
Grantor shall keep materially complete and accurate records of its Accounts.
Upon the request of the Administrative Agent, and prior to an Event of Default,
no more frequently than one time per calendar quarter, such Grantor shall
deliver to the Administrative Agent all documents, including, without
limitation, repayment histories and present status reports, relating to its
Accounts so scheduled and such other matters and information relating to the
status of its then existing Accounts as the Administrative Agent shall
reasonably request.
(ii) In
the event any amounts due and owing in excess of $250,000 in the aggregate are
in dispute between any Account Debtor and any Grantor, such Grantor shall
provide the Administrative Agent with written notice thereof promptly after such
Grantor’s learning thereof explaining in detail the reason for the dispute, all
claims related thereto and the amount in controversy.
(iii) Each
Grantor shall maintain itemized records, accurate in all material respects
consistent with past practice, itemizing and describing the kind, type, quality,
quantity, location and book value of its Inventory and Equipment and shall, upon
request by the Administrative Agent, furnish the Administrative Agent with a
current schedule containing the foregoing information.
(iv) Each
Grantor will promptly upon, but in no event later than five (5) Business Days
after:
(A) Such
Grantor’s learning thereof, inform the Administrative Agent, in writing, of any
material delay in such Grantor’s performance of any of its obligations to any
Account Debtor and of any assertion of any claims, offsets or counterclaims by
any Account Debtor and of any allowances, credits or other monies granted by
such Grantor to any Account Debtor, in each case involving amounts in excess of
$250,000 in the aggregate for all Accounts of such Account Debtor;
and
(B) Such
Grantor’s receipt or learning thereof, furnish to and inform the Administrative
Agent of all material adverse information relating to the financial condition of
any Account Debtor with respect to Accounts exceeding $250,000 in the aggregate;
and
(v) Such
Grantor will promptly notify the Administrative Agent in writing if any Account,
the face value of which exceeds $250,000, arises out of a contract with the
United States of America, or any department, agency, subdivision or
instrumentality thereof, or of any state (or department, agency, subdivision or
instrumentality thereof) where such state has a state assignment of claims act
or other law comparable to the Federal Assignment of Claims Act, and will take
any action required or requested by the Administrative Agent to give notice of
the Administrative Agent’s security interest in such Accounts under the
provisions of the Federal Assignment of Claims Act or any comparable law or act
enacted by any state or local governmental authority.
15
(c) Further Identification of
Collateral. Each Grantor will if so requested by the Administrative Agent
furnish to the Administrative Agent, as often as the Administrative Agent
reasonably requests but in no event more frequently than once per calendar
quarter, statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as the
Administrative Agent may reasonably request, all in reasonable
detail.
(d) Notices. In addition
to the notices required by Section 5(b) hereof, each Grantor will advise the
Administrative Agent promptly, but in no event later than fifteen (15) days after the
occurrence thereof, in reasonable detail, (i) of any Lien or claim made or
asserted against any of the Collateral that is not expressly permitted by the
terms of the Credit Agreement, and (ii) of the occurrence of any other event
which would have a material adverse effect on the aggregate value of the
Collateral or on the validity, perfection or priority of the Security
Interests.
SECTION 6. General
Authority. Each
Grantor hereby irrevocably appoints the Administrative Agent its true and lawful
attorney, with full power of substitution, in the name of such Grantor, the
Administrative Agent or otherwise, for the sole use and benefit of the
Administrative Agent on its behalf and on behalf of the Secured Parties, but at
such Grantor’s expense, to exercise, at any time (subject to the proviso below)
all or any of the following powers:
(i)
to file the financing statements,
financing statement amendments and continuation statements referred to in
Section 4(a)(iii),
(ii) to
demand, sue for, collect, receive and give acquittance for any and all monies
due or to become due with respect to any Collateral or by virtue
thereof,
(iii) to
settle, compromise, compound, prosecute or defend any action or proceeding with
respect to any Collateral,
(iv) to
sell, transfer, assign or otherwise deal in or with the Collateral or the
proceeds or avails thereof, as fully and effectually as if the Administrative
Agent were the absolute owner thereof, and
(v) to
extend the time of payment of any or all thereof and to make any allowance and
other adjustments with reference to the Collateral.
provided, however, that the
powers described in clauses (ii), (iii), (iv) and (v) above may be exercised by
the Administrative Agent only if an Event of Default then
exists.
16
SECTION 7. Events of
Default. The existence or occurrence of any “Event of Default” as
provided under the terms of the Credit Agreement shall constitute an Event of
Default under this Agreement..
SECTION
8. Remedies upon
Event of Default.
(a)
If any Event of Default has occurred and is continuing, the
Administrative Agent may, without further notice, exercise all rights and
remedies under this Agreement or any other Loan Document or that are available
to a secured creditor under the UCC or that are otherwise available at law or in
equity, at any time, in any order and in any combination, including to collect
any and all Secured Obligations from the Grantors, and, in addition, the
Administrative Agent may sell the Collateral or any part thereof at public or
private sale, for cash, upon credit or for future delivery, and at such price or
prices as the Administrative Agent may deem satisfactory. The Administrative
Agent shall give the Borrower not less than ten (10) days’ prior written notice
of the time and place of any sale or other intended disposition of Collateral,
except any Collateral which is perishable or threatens to decline speedily in
value or is of a type customarily sold on a recognized market. Each Grantor
agrees that any such notice constitutes “reasonable notification” within the
meaning of Section 9-611 of the UCC (to the extent such Section or any
successor provision under the UCC is applicable).
(b) The
Administrative Agent may be the purchaser of any or all of the Collateral so
sold at any public sale (or, if such Collateral is of a type customarily sold in
a recognized market or is of a type which is the subject of widely distributed
standard price quotations or if otherwise permitted under applicable law, at any
private sale) and thereafter hold the same, absolutely, free from any right or
claim of whatsoever kind. Each Grantor agrees during an Event of Default to
execute and deliver such documents and take such other action as the
Administrative Agent deems necessary or advisable in order that any such sale
may be made in compliance with law. Upon any such sale the Administrative Agent
shall have the right to deliver, assign and transfer to the purchaser thereof
the Collateral so sold. Each purchaser at any such sale shall hold the
Collateral so sold to it absolutely, free from any claim or right of any kind,
including any equity or right of redemption of the Grantors. To the extent
permitted by law, each Grantor hereby specifically waives all rights of
redemption, stay or appraisal which it has or may have under any law now
existing or hereafter adopted. The notice (if any) of such sale shall (1) in
case of a public sale, state the time and place fixed for such sale, and (2) in
the case of a private sale, state the day after which such sale may be
consummated. Any such public sale shall be held at such time or times within
ordinary business hours and at such place or places as the Administrative Agent
may fix in the notice of such sale. At any such sale Collateral may be sold in
one lot as an entirety or in separate parcels, as the Administrative Agent may
determine. The Administrative Agent shall not be obligated to make any such sale
pursuant to any such notice. The Administrative Agent may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for the
sale, and such sale may be made at any time or place to which the same may be so
adjourned. In case of any sale of all or any part of the Collateral on credit or
for future delivery, such Collateral so sold may be retained by the
Administrative Agent until the selling price is paid by the purchaser thereof,
but the Administrative Agent shall not incur any liability in case of the
failure of such purchaser to take up and pay for such Collateral so sold and, in
case of any such failure, such Collateral may again be sold upon like notice.
The Administrative Agent, instead of exercising the power of sale herein
conferred upon it, may proceed by a suit or suits at law or in equity to
foreclose the Security Interests and sell Collateral, or any portion thereof,
under a judgment or decree of a court or courts of competent jurisdiction. The
Grantors shall remain liable for any deficiency.
17
(c) For
the purpose of enforcing any and all rights and remedies under this Agreement
following the occurrence and during the existence of an Event of Default, the
Administrative Agent may (i) require any Grantor to, and each Grantor agrees
that it will, at the joint and several expense of the Grantors, and upon the
request of the Administrative Agent, forthwith assemble all or any part of its
Collateral as directed by the Administrative Agent and make it available at a
place designated by the Administrative Agent which is, in the Administrative
Agent’s opinion, reasonably convenient to the Administrative Agent and such
Grantor, whether at the premises of such Grantor or otherwise, (ii) to the
extent permitted by applicable law, enter, with or without process of law and
without breach of the peace, any premise where any such Collateral is or may be
located and, without charge or liability to the Administrative Agent, seize and
remove such Collateral from such premises, (iii) have access to and use such
Grantor’s books and records, computers and software relating to the Collateral,
and (iv) prior to the disposition of any of the Collateral, store or
transfer such Collateral without charge in or by means of any storage or
transportation facility owned or leased by such Grantor, process, repair or
recondition such Collateral or otherwise prepare it for disposition in any
manner and to the extent the Administrative Agent deems appropriate and, in
connection with such preparation and disposition, use without charge any
trademark, trade name, copyright, patent or technical process used such
Grantor.
(d) Without
limiting the generality of the foregoing, if any Event of Default has occurred
and is continuing:
(i) the
Administrative Agent may (without assuming any obligations or liability
thereunder), at any time and from time to time, enforce (and shall have the
exclusive right to enforce) against any licensee or sublicensee all rights and
remedies of any Grantor in, to and under any Licenses and take or refrain from
taking any action under any thereof, and each Grantor hereby releases the
Administrative Agent from, and agrees to hold the Administrative Agent free and
harmless from and against any claims arising out of, any lawful action so taken
or omitted to be taken with respect thereto except for the
Administrative Agent’s gross negligence or willful misconduct as determined by a
final and nonappealable decision of a court of competent jurisdiction;
and
(ii) upon
request by the Administrative Agent, each Grantor agrees to execute and deliver
to the Administrative Agent powers of attorney, in form and substance
satisfactory to the Administrative Agent, for the implementation of any lease,
assignment, license, sublicense, grant of option, sale or other disposition of
any Intellectual Property. In the event of any such disposition pursuant to this
Section, each Grantor shall supply its know-how and expertise relating to the
manufacture and sale of the products bearing Trademarks or the products or
services made or rendered in connection with Patents or Copyrights, and its
customer lists and other records relating to such Intellectual Property and to
the distribution of said products, to the Administrative
Agent.
18
SECTION 9. Limitation
on Duty of Administrative Agent in Respect of Collateral. Beyond reasonable care in
the custody thereof, the Administrative Agent shall have no duty as to any
Collateral of any Grantor in its possession or control or in the possession or
control of any agent or bailee or any income thereon or as to the preservation
of rights against prior parties or any other rights pertaining thereto. The
Administrative Agent shall be deemed to have exercised reasonable care in the
custody of the Collateral of the Grantors in its possession if such Collateral
is accorded treatment substantially equal to that which it accords its own
property, and the Administrative Agent shall not be liable or responsible for
any loss or damage to any of the Grantors’ Collateral, or for any diminution in
the value thereof, by reason of the act or omission of any warehouseman,
carrier, forwarding agency, consignee or other agent or bailee selected by the
Administrative Agent in good faith.
SECTION 10. Application
of Proceeds. The
proceeds of any sale of, or other realization upon, all or any part of the
Collateral of the Grantors shall be applied by the Administrative Agent in the
manner set forth in Section 2.21(b) of the Credit Agreement, and, after the
application and payment by the Administrative Agent of any other amount required
by any provision of law, including Section 9-615(a)(3) of the UCC, to account
for any surplus, to the applicable Grantor.
SECTION 11. Concerning
the Administrative Agent. The provisions of Article IX
of the Credit Agreement shall inure to the benefit of the Administrative Agent
in respect of this Agreement and shall be binding upon the parties to the Credit
Agreement in such respect. In furtherance and not in derogation of the rights,
privileges and immunities of the Administrative Agent therein set
forth:
(a) The
Administrative Agent is authorized to take all such action as is provided to be
taken by it as the Administrative Agent hereunder or otherwise permitted under
the Credit Agreement and all other action reasonably incidental thereto. As to
any matters not expressly provided for herein or therein, the Administrative
Agent may request instructions from the Lenders and shall act or refrain from
acting in accordance with written instructions from the Required Lenders or, in
the absence of such instructions, in accordance with its
discretion.
(b) The
Administrative Agent shall not be responsible for the existence, genuineness or
value of any of the Grantors’ Collateral or for the validity, perfection,
priority or enforceability of the Security Interests, whether impaired by
operation of law or by reason of any action or omission to act on its part. The
Administrative Agent shall have no duty to ascertain or inquire as to the
performance or observance of any of the terms of this Agreement by the
Grantors.
SECTION 12. Appointment
of Co-Agents. At
any time or times, in order to comply with any legal requirement in any
jurisdiction, the Administrative Agent may appoint another bank or trust company
or one or more other Persons reasonably acceptable to the Required Lenders and,
so long as no Event of Default has occurred or is continuing, the Borrower,
either to act as co-agent or co-agents, jointly with the Administrative Agent,
or to act as separate agent or agents on behalf of the Administrative Agent and
the Secured Parties with such power and authority as may be necessary for the
effectual operation of the provisions hereof and specified in the instrument of
appointment (which may, in the discretion of the Administrative Agent, include
provisions for the protection of such co-agent or separate agent similar to the
provisions of Section 11).
19
SECTION 13. Expenses. In the event that any
Grantor fails to comply with the provisions of the Credit Agreement, this
Agreement or any other Loan Document, such that the value of any of its
Collateral or the validity, perfection, rank or value of the Security Interests
are thereby diminished or potentially diminished or put at risk, the
Administrative Agent may, but shall not be required to, effect such compliance
on behalf of such Grantor, and the Grantors shall jointly and severally
reimburse the Administrative Agent for the reasonable, documented and actual
costs thereof on demand. All insurance expenses and all reasonable, documented
and out-of-pocket expenses of protecting, storing, warehousing, appraising,
insuring, handling, maintaining and shipping such Collateral, any and all
excise, stamp, intangibles, transfer, property, sales, and use taxes imposed by
any state, federal, or local authority or any other governmental authority on
any of such Collateral, or in respect of periodic appraisals and inspections of
such Collateral (subject to any limitations contained in the Credit Agreement),
or in respect of the sale or other disposition thereof, shall be borne and paid
by the Grantors jointly and severally; and if the Grantors fail promptly to pay
any portion thereof when due, the Administrative Agent may, at its option, but
shall not be required to, pay the same and charge the Grantors’ accounts
therefor, and the Grantors agree jointly and severally to reimburse the
Administrative Agent therefor on demand. All sums so paid or incurred by the
Administrative Agent for any of the foregoing and any and all other sums for
which the Grantors may become liable hereunder and all reasonable, documented
out-of-pocket costs and expenses (including reasonable attorneys’ fees, legal
expenses and court costs) actually incurred by the Administrative Agent in
enforcing or protecting the Security Interests or any of its rights or remedies
thereon shall be payable by the Grantors on demand and shall bear interest
(after as well as before judgment) until paid at the default rate of interest
set forth in the Credit Agreement and shall be additional Secured Obligations
hereunder.
SECTION 14. Termination
of Security Interests; Release of Collateral. Upon the repayment in full
in cash of all Secured Obligations (other than indemnification obligations that
survive termination of the Loan Documents and Treasury Management Obligations to
the extent comprised solely of any requirement to maintain or terminate any
deposit accounts with any Lender), termination of all commitments of the Lenders
under the Credit Agreement and the cash collateralization of the LC Exposure, if
any, or termination of any required cash collateralization of any LC Exposure by
the Issuing Bank in its sole discretion, the Security Interests shall terminate
and all rights to the Collateral shall revert to the Grantors. Upon any such
termination of the Security Interests or release of such Collateral, the
Administrative Agent will, at the expense of the Borrower, execute and deliver
to the Borrower such documents as the Grantors shall reasonably request, but
without recourse or warranty to the Administrative Agent, including but not
limited to written authorization to file termination statements to evidence the
termination of the Security Interests in such Collateral.
SECTION 15. Notices. All notices, requests and
other communications to the Grantors or the Administrative Agent hereunder shall
be delivered in the manner required by the Credit Agreement and shall be
sufficiently given to the Administrative Agent or any Grantor if addressed or
delivered to them at, in the case of the Administrative Agent and the Borrower,
its addresses and telecopier numbers specified in the Credit Agreement and in
the case of any other Grantors, at their respective addresses and telecopier
numbers provided in the Subsidiary Guaranty Agreement. All such notices and
communications shall be deemed to have been duly given at the times set forth in
the Credit Agreement.
20
SECTION 16. No
Waiver; Remedies Cumulative.
(a) No
failure or delay of the Administrative Agent of any kind in exercising any
power, right or remedy hereunder and no course of dealing between any Grantor on
the one hand and the Administrative Agent or any holder of any Note on the other
hand shall operate as a waiver thereof, nor shall any single or partial exercise
of any such power, right or remedy hereunder or under any other Loan Document,
or any abandonment or discontinuance of steps to enforce such a power, right or
remedy, preclude any other or further exercise thereof or the exercise of any
other power, right or remedy. The rights of the Administrative Agent hereunder
and of the Lenders under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement or consent to any departure by any Grantor
therefrom shall in any event be effective unless the same shall be permitted by
subsection (b) below, and then such waiver and consent shall be effective
only in the specific instance and for the purpose for which given. No notice or
demand on any Grantor in any case shall entitle such Grantor to any other or
further notice in similar or other circumstances.
(b) Neither
this Agreement nor any provision hereof may be waived, amended or modified
except pursuant to a written agreement entered into between the Grantors with
respect to which such waiver, amendment or modification relates and the
Administrative Agent, with the prior written consent of the Required Lenders
(except as otherwise provided in the Credit Agreement).
SECTION 17. Successors
and Assigns. This
Agreement is for the benefit of the Administrative Agent and the Secured Parties
and their permitted successors and assigns, and in the event of an assignment of
all or any of the Secured Obligations, the rights hereunder, to the extent
applicable to the indebtedness so assigned, may be transferred with such
indebtedness. This Agreement shall be binding on the Grantors and their
successors and assigns; provided, however, that no
Grantor may assign any of its rights or obligations hereunder without the prior
written consent of the Administrative Agent and the Lenders.
SECTION
18. Governing Law; Jurisdiction;
Consent to Service of Process.
(a) This
Agreement shall be construed in accordance with and be governed by the law
(without giving effect to the conflict of law principles thereof) of the State
of Georgia.
(b) Each
Grantor hereby irrevocably and unconditionally submits, for itself and its
property, to the exclusive jurisdiction of the United States courts located
within Northern District in the State of Georgia, and the Business Case Division
of the Fulton County Superior Court located in Atlanta, Georgia and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or any other Loan Document or the transactions
contemplated hereby or thereby, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such Georgia state court or, to the extent permitted by
applicable law, such Federal court. Each Grantor agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement shall affect any right that the Administrative Agent,
the Issuing Bank or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement against any Grantor or its properties in
the courts of any jurisdiction.
21
(c) Each
Grantor irrevocably and unconditionally waives any objection which it
may now or hereafter have to the laying of venue of any such suit, action
or proceeding described in paragraph (b) of this Section and brought in any
court referred to in paragraph (b) of this Section. Each party hereto
irrevocably waives, to the fullest extent permitted by applicable law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.
(d) Each
Grantor irrevocably consents to the service of process in the manner provided
for notices in Section 10.1 of the Credit Agreement. Nothing in this Agreement
will affect the right of the Administrative Agent or any Lender to serve process
in any other manner permitted by law.
SECTION 19. WAIVER OF
JURY TRIAL. EACH
PARTY HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY
OR INDIRECTLY ARISING OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR
ANY OTHER THEORY). EACH PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER, AND (ii) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES
HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.
SECTION 20. Severability. Any provision of this
Agreement held to be illegal, invalid or unenforceable in any jurisdiction,
shall, as to such jurisdiction, be ineffective to the extent of such illegality,
invalidity or unenforceability without affecting the legality, validity or
enforceability of the remaining provisions hereof or thereof; and the
illegality, invalidity or unenforceability of a particular provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
SECTION 21. Counterparts;
Integration. This
Agreement may be executed by one or more of the parties to this Agreement on any
number of separate counterparts (including by telecopy), and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. This Agreement constitutes the entire agreement among the parties
hereto regarding the subject matters hereof and supersedes all prior agreements
and understandings, oral or written, regarding such subject
matter.
22
SECTION 22. Additional
Grantors.
Pursuant to Section 5.11 of the Credit Agreement, each Domestic
Subsidiary that was not in existence on the date of the Credit Agreement is
required to enter into this Agreement as a Grantor upon becoming such a
Subsidiary. Upon execution and delivery after the date hereof by the
Administrative Agent and such Subsidiary of an instrument in the form of Exhibit A, such
Subsidiary shall become a Grantor hereunder with the same force and effect as if
originally named as a Grantor herein. The execution and delivery of any
instrument adding an additional Grantor as a party to this Agreement shall not
require the consent of any other Grantor hereunder. The rights and obligations
of each Grantor hereunder shall remain in full force and effect notwithstanding
the addition of any new Grantor as a party to this Agreement.
(Signatures
on following page)
23
IN
WITNESS WHEREOF, the Grantors have caused this Agreement to be duly executed and
delivered by their duly authorized officers as of the day and year first above
written.
|
EASYLINK
SERVICES INTERNATIONAL CORPORATION, a Delaware
corporation
|
||
|
By:
|
/s/ Thomas J. Stallings
|
|
|
Name:
|
Thomas J.
Stallings
|
|
|
Title:
|
Chief Executive
Officer
|
|
|
[CORPORATE
SEAL]
|
||
|
EASYLINK
SERVICES CORPORATION, a Delaware corporation
|
||
|
By:
|
/s/ Thomas J. Stallings
|
|
|
Name:
|
Thomas J.
Stallings
|
|
|
Title:
|
President
|
|
|
[CORPORATE
SEAL]
|
||
|
EASYLINK
SERVICES USA, INC., a Delaware corporation
|
||
|
By:
|
/s/ Thomas J. Stallings
|
|
|
Name:
|
Thomas J.
Stallings
|
|
|
Title:
|
President
|
|
|
[CORPORATE
SEAL]
|
||
(Signatures
continue on following page)
24
|
XPEDITE
SYSTEMS, LLC, a Delaware limited liability company
|
||
|
By:
|
EasyLink
Services International
Corporation,
a Delaware corporation,
|
|
|
|
its
Sole Member
|
|
|
By:
|
/s/ Thomas J. Stallings
|
|
|
Name:
|
Thomas J.
Stallings
|
|
|
Title:
|
Chief Executive
Officer
|
|
|
[CORPORATE
SEAL]
|
||
|
XPEDITE
SYSTEMS WORLDWIDE, INC., a
Delaware
corporation
|
||
|
By:
|
/s/ Thomas J. Stallings
|
|
|
Name:
|
Thomas J.
Stallings
|
|
|
Title:
|
President
|
|
|
[CORPORATE
SEAL]
|
||
|
XPEDITE
NETWORK SERVICES, INC., a
Georgia
corporation
|
||
|
By:
|
/s/ Thomas J. Stallings
|
|
|
Name:
|
Thomas J.
Stallings
|
|
|
Title:
|
President
|
|
|
[CORPORATE
SEAL]
|
||
|
PTEK
SERVICES, INC., a Delaware corporation
|
||
|
By:
|
/s/ Thomas J. Stallings
|
|
|
Name:
|
Thomas J.
Stallings
|
|
|
Title:
|
President
|
|
|
[CORPORATE
SEAL]
|
||
25