Exhibit 10.8
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AMENDED AND RESTATED SECURITY AGREEMENT
among
REYNOLDS AMERICAN INC.,
R.J. REYNOLDS TOBACCO HOLDINGS, INC.,
VARIOUS SUBSIDIARIES OF
REYNOLDS AMERICAN INC.
and
JPMORGAN CHASE BANK,
as Collateral Agent
Dated as of July 30, 2004
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EXHIBIT 1
AMENDED AND RESTATED SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of July 15, 2003 and amended and
restated as of July 30, 2004 (as so amended and restated and as the same may be
further amended, restated, supplemented and/or otherwise modified from time to
time, this "Agreement"), among each of the undersigned (together with any other
entity that becomes a party hereto pursuant to Section 10.12 hereof, each, an
"Assignor" and, collectively, the "Assignors") and JPMORGAN CHASE BANK, as
Collateral Agent (in such capacity, together with any successor collateral
agent, the "Collateral Agent") for the Secured Creditors (as defined below).
Capitalized terms used herein shall have the meaning specified in Article IX
herein or, if not defined therein, as specified in the Credit Agreement referred
to below.
W I T N E S S E T H:
WHEREAS, Reynolds American Inc. ("Parent"), R.J. Reynolds Tobacco
Holdings, Inc. (the "Borrower"), the various lending institutions from time to
time party thereto (the "Lenders"), and JPMORGAN CHASE BANK, as Administrative
Agent (the "Administrative Agent"), have entered into a Credit Agreement, dated
as of May 7, 1999, as amended and restated as of November 17, 2000, as further
amended and restated as of May 10, 2002 and as further amended and restated as
of July 30, 2004, providing for the making of Loans to the Borrower and the
issuance of, and participation in, Letters of Credit for the account of the
Borrower, all as contemplated therein (with (i) the Lenders, each Letter of
Credit Issuer, the Administrative Agent, the Senior Managing Agents, the Pledgee
and the Collateral Agent being herein called the "Lender Creditors" and (ii) the
term "Credit Agreement" as used herein to mean the Credit Agreement described
above in this paragraph, as the same may be further amended, modified, extended,
renewed, replaced, restated, supplemented and/or refinanced from time to time,
and including any agreement extending the maturity of, or refinancing or
restructuring (including, but not limited to, the inclusion of additional
borrowers or guarantors thereunder or any increase in the amount borrowed) all
or any portion of, the indebtedness under such agreement or any successor
agreement, whether or not with the same agent, trustee, representative, lenders
or holders; provided that, with respect to any agreement providing for the
refinancing or replacement of indebtedness under the Credit Agreement, such
agreement shall only be treated as, or as part of, the Credit Agreement
hereunder if (x) either (A) all obligations under the Credit Agreement being
refinanced or replaced shall be paid in full at the time of such refinancing or
replacement, and all commitments and letters of credit issued pursuant to the
refinanced or replaced Credit Agreement shall have terminated in accordance with
their terms or (B) the Required Lenders shall have consented in writing to the
refinancing or replacement indebtedness being treated as indebtedness pursuant
to the Credit Agreement, and (y) a notice to the effect that the refinancing or
replacement indebtedness shall be treated as issued under the Credit Agreement
shall be delivered by the Borrower to the Collateral Agent);
WHEREAS, Parent and/or one or more of its Subsidiaries has from time
to time entered into, and/or may in the future from time to time enter into, one
or more agreements or
Exhibit I
Page 2
arrangements with JPMCB or any of its affiliates (even if JPMCB ceases to be a
Lender under the Credit Agreement for any reason (JPMCB and any such affiliate
and their respective successors and assigns, each, a "Credit Card Issuer"))
providing for credit card loans to be made available to certain employees of
Parent and/or one or more of its Subsidiaries (each such agreement or
arrangement with a Credit Card Issuer, a "Secured Credit Card Agreement").
WHEREAS, Parent and/or one or more of its Subsidiaries has from time
to time entered into, and/or may in the future from time to time enter into, one
or more (i) interest rate protection agreements (including, without limitation,
interest rate swaps, caps, floors, collars and similar agreements), (ii) foreign
exchange contracts, currency swap agreements, commodity agreements or other
similar agreements or arrangements designed to protect against the fluctuations
in currency values and/or (iii) other types of hedging agreements from time to
time (each such agreement or arrangement with a Hedging Creditor (as hereinafter
defined), together with the Existing Interest Rate Swap Agreement, a "Secured
Hedging Agreement"), with any Lender, or any affiliate thereof or a syndicate of
financial institutions organized by a Lender or an affiliate of a Lender (even
if any such Lender ceases to be a Lender under the Credit Agreement for any
reason) (any such Lender, affiliate or other such financial institution that
participates therein, together with Calyon (as counterparty to the Existing
Interest Rate Swap Agreement), and in each case their subsequent successors and
assigns, collectively, the "Hedging Creditors", and together with the Lender
Creditors and each Credit Card Issuer, the "Lender Secured Creditors");
WHEREAS, the Borrower and the trustee thereunder (the "Existing
Senior Notes Trustee"), on behalf of the holders of the Existing Senior Notes
(such holders, together with the Existing Senior Notes Trustee, the "Existing
Senior Notes Creditors"), have from time to time entered into, and may in the
future from time to time enter into, one or more Indentures (collectively, as
amended, modified or supplemented from time to time, the "Existing Senior Notes
Indenture" and, together with the Existing Senior Notes, the "Existing Senior
Notes Documents") providing for the issuance of Existing Senior Notes by the
Borrower;
WHEREAS, the Borrower and the trustee or trustees thereunder
(collectively, the "Refinancing Senior Notes Trustee"), on behalf of the holders
of the Refinancing Senior Notes (such holders, together with the Refinancing
Senior Notes Trustee, the "Refinancing Senior Notes Creditors", with the Lender
Secured Creditors, the Existing Senior Notes Creditors and the Refinancing
Senior Notes Creditors being herein called the "Secured Creditors"), may from
time to time enter into one or more Indentures (collectively, as amended,
modified or supplemented from time to time, the "Refinancing Senior Notes
Indenture" and, together with the Refinancing Senior Notes, the "Refinancing
Senior Notes Documents") providing for the issuance of Refinancing Senior Notes
by the Borrower;
WHEREAS, pursuant to the Subsidiary Guaranty, each Assignor (other
than the Borrower) has jointly and severally guaranteed to the Lender Secured
Creditors the payment when due of the Guaranteed Obligations (as defined in the
Subsidiary Guaranty);
WHEREAS, pursuant to the Credit Agreement Party Guaranty, each
Credit Agreement Party has guaranteed to the Hedging Creditors and each Credit
Card Issuer the payment when due of the Relevant Guaranteed Obligations;
Exhibit I
Page 3
WHEREAS, each Specified Assignor (other than the Borrower) has
jointly and severally guaranteed to the Existing Senior Notes Creditors the
payment when due of principal and interest on the Existing Senior Notes;
WHEREAS, each Specified Assignor (other than the Borrower) has
jointly and severally guaranteed to the Refinancing Senior Notes Creditors the
payment when due of principal and interest on the Refinancing Senior Notes;
WHEREAS, certain of the Assignors have heretofore entered into a
Security Agreement, dated as of July 15, 2003 (as amended, restated, modified
and/or supplemented from time to time, but not including, the date hereof, the
"Original Security Agreement");
WHEREAS, the Assignors desire to amend and restate the Original
Security Agreement in the form of this Agreement;
WHEREAS, the Credit Agreement requires this Agreement be executed
and delivered to the Collateral Agent by the Assignors and the Secured Hedging
Agreements, the Existing Senior Notes Indenture and the Refinancing Senior Notes
Indenture, require that this Agreement secure the respective Obligations as
provided herein;
WHEREAS, each Assignor desires to execute this Agreement to satisfy
the conditions 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 and hereby
covenants and agrees 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 its Applicable Obligations,
each Assignor does hereby sell, assign and transfer unto the Collateral Agent,
and does hereby grant to the Collateral Agent for the benefit of the Secured
Creditors as their interests may appear, a continuing security interest in, all
of the right, title and interest of such Assignor in, to and under all of the
following, whether now existing or hereafter from time to time acquired:
(i) each and every Receivable;
(ii) all Contracts, together with all Contract Rights arising
thereunder;
(iii) all Inventory;
(iv) all Equipment;
Exhibit I
Page 4
(v) all Marks, together with the registrations and right to all
renewals thereof, and the goodwill of the business of such Assignor
symbolized by the Marks;
(vi) the Cash Collateral Account established for such Assignor and
all moneys, securities and instruments deposited or required to be
deposited in such Cash Collateral Account;
(vii) all Patents and Copyrights and all reissues, renewals or
extensions thereof;
(viii) all computer programs of such Assignor and all intellectual
property rights therein and all other proprietary information of such
Assignor, including, but not limited to, Trade Secrets Rights;
(ix) all insurance policies;
(x) all other Goods, General Intangibles, Chattel Paper (including
without limitation all Tangible Chattel Paper and all Electronic Chattel
Paper), Documents and Instruments;
(xi) all Permits;
(xii) all cash;
(xiii) all Commercial Tort Claims;
(xiv) all Deposit Accounts and all other demand, deposit, time,
savings, cash management, passbook and similar accounts maintained by such
Assignor with any Person and all moneys, securities, Instruments and other
investments deposited or required to be deposited in any of the foregoing;
(xv) all Investment Property;
(xvi) all Letter-of-Credit Rights (whether or not the respective
letter of credit is evidenced by a writing);
(xvii) all Software and all Software licensing rights, all writings,
plans, specifications and schematics, all engineering drawings, customer
lists, goodwill and licenses, and all recorded data of any kind or nature,
regardless of the medium of recording;
(xviii) all Supporting Obligations; and
(xix) all Proceeds and products of any and all of the foregoing (all
of the above, including this clause (xix), collectively, the
"Collateral");
provided that the Collateral that secures the Existing Senior Notes Obligations
and the Refinancing Senior Notes Obligations of a Specified Assignor shall be
limited to Collateral owned by such Specified Assignor consisting of any shares
of stock, indebtedness or other
Exhibit I
Page 5
obligations of a Subsidiary of Parent or of any Principal Property of any
Specified Assignor (the "Designated Collateral"), all of which Collateral shall
also ratably secure all other Applicable Obligations of such Specified Assignor,
and the Collateral Proceeds with respect to any item of Collateral owned by a
Specified Assignor that are to be applied to the Existing Senior Notes
Obligations or to the Refinancing Senior Notes Obligations shall be limited to
Collateral Proceeds from the sale, other disposition of or other realization
upon, and other moneys received in respect of, the Designated Collateral of such
Specified Assignor, with such Collateral Proceeds to also be applied ratably to
all other Applicable Obligations of such Specified Assignor.
(b) Notwithstanding anything contained herein to the contrary,
"Collateral" shall not include any Copyright, Mark, Patent, Trade Secret,
computer program or Software to the extent such property is subject to a license
or agreement the terms of which prohibit an assignment of, or the granting of a
security interest in, such Assignor's rights thereunder or such Assignor's grant
of a security interest pursuant to this Agreement would give any party thereto
(other than such Assignor) the right to terminate its obligations thereunder;
provided that the foregoing limitation shall not affect, limit, restrict or
impair the grant by an Assignor of the security interest pursuant to this
Agreement in any account or any money or other amounts due or to become due
under any such Copyright, Mark, Patent, Trade Secret, computer program or
Software or such license or agreement governing the same.
(c) The security interest of the Collateral Agent under this
Agreement extends to all Collateral of the kind which is the subject of this
Agreement which any Assignor may acquire at any time during the continuation of
this Agreement.
1.2 Power of Attorney. Each Assignor hereby constitutes and appoints
the Collateral Agent its true and lawful attorney, irrevocably, with full power
after the occurrence of and during the continuance of an Event of Default (in
the name of such Assignor or otherwise) to act, require, demand, receive,
compound and give acquittance for any and all moneys and claims for moneys due
or to become due to such Assignor under or arising out of the Collateral, to
endorse any checks or other instruments or orders in connection therewith and to
file any claims or take any action or institute any proceedings which the
Collateral Agent may deem to be necessary or advisable in the premises, which
appointment as attorney is coupled with an interest.
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 and recordings
necessary or appropriate to create, preserve, protect and perfect the security
interest granted by such Assignor to the Collateral Agent hereby in respect of
all the Collateral have been accomplished or shall have been accomplished within
45 days of a Trigger Event (or, in the case of Collateral constituting Excluded
Unperfected Collateral, on the date on which such Collateral ceases to
Exhibit I
Page 6
qualify as such in accordance with the definition of Excluded Unperfected
Collateral) and the security interest granted to the Collateral Agent pursuant
to this Agreement in and to all of the Collateral (other than Excluded
Unperfected Collateral) constitutes, upon satisfaction of such filings,
registrations and recordings, a perfected security interest therein superior and
prior to the rights of all other Persons therein (other than any such rights
pursuant to any Permitted Liens that have a priority as provided under
applicable law) and subject to no other Liens (other than Permitted Liens) and
is entitled to all the rights, priorities and benefits afforded by the Uniform
Commercial Code or other relevant law as enacted in any relevant jurisdiction to
perfected security interests.
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, security interest, encumbrance or other
right, title or interest of any Person (other than Permitted Liens), and such
Assignor shall defend the Collateral against all claims and demands of all
Persons at any time claiming the same or any interest therein (other than in
connection with Permitted Liens) adverse to the Collateral Agent.
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 financing statements filed pursuant to the same liens as
Permitted Liens) and at all times prior to the Termination Date, 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 as permitted by the Credit
Agreement.
2.4 Chief Executive Office; Records. As of the date hereof, the
chief executive office of such Assignor is located at the address or addresses
indicated on Annex A hereto. Such Assignor will not move its chief executive
office except to such new location as such Assignor may establish in accordance
with the last sentence of this Section 2.4. The originals of all documents
evidencing all Receivables and Contract Rights and Trade Secret Rights of such
Assignor and the only original books of account and records of such Assignor
relating thereto are, and will continue to be, kept at such chief executive
office and/or one or more of the locations shown on Annex A, or at such new
locations as such Assignor may establish in accordance with the last sentence of
this Section 2.4. All Receivables and Contract Rights and Trade Secret Rights of
such Assignor are, and will continue to be, maintained at, and controlled and
directed (including, without limitation, for general accounting purposes) from,
the office locations described above, or such new locations as such Assignor may
establish in accordance with the last sentence of this Section 2.4. Such
Assignor shall not establish new locations for such chief executive offices
until (i) it shall have given to the Collateral Agent not less than 15 days'
prior written notice (or such lesser notice as shall be acceptable to the
Collateral Agent in the case of a new record location to be established in
connection with newly acquired Contracts) of its intention to do so, clearly
describing such new location and providing such other information in connection
therewith as the Collateral Agent may reasonably request, and (ii) with respect
to such new location, it shall have taken all action, reasonably satisfactory to
Exhibit I
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the Collateral Agent, to maintain the security interest of the Collateral Agent
in the Collateral intended to be granted hereby at all times fully perfected and
in full force and effect.
2.5 Location of Inventory and Equipment. All Inventory and Equipment
held on the date hereof by each Assignor (other than immaterial amounts of
Inventory and Equipment) is located at one of the locations shown on Annex B
attached hereto, is in transit between such locations, or is in transit to
customers.
2.6 Legal Names; Organizational Identification Number; Trade Names;
Change of Name; etc. The exact legal name of each Assignor, and the
organizational identification number (if any) of each Assignor, as of the date
hereof, is listed on Annex C hereto for such Assignor. No Assignor has or
operates in any jurisdiction under, or in the five years preceding the date
hereof has had or has operated in any jurisdiction under, any trade names,
fictitious names or other names except its legal name and such other trade or
fictitious names as are listed on Annex C hereto for such Assignor. No Assignor
shall change its legal name, organizational identification number (if any) or
assume or operate in any jurisdiction under any trade, fictitious or other name
except its legal name, organizational identification number and those trade
names in each case listed on Annex C hereto for such Assignor and those that may
be established in accordance with the immediately succeeding sentence of this
Section 2.6. No Assignor shall change its legal name or organizational
identification number or assume or operate in any jurisdiction under any new
trade, fictitious or other name or operate under any existing name in any
additional jurisdiction until (i) it shall have given to the Collateral Agent
not less than 15 days' prior written notice of its intention so to do, clearly
describing such new name and/or jurisdiction and, in the case of a new name, the
jurisdictions in which such new name shall be used and providing such other
information in connection therewith as the Collateral Agent may reasonably
request, (ii) with respect to such new name and/or jurisdiction, it shall have
taken all action necessary, or in the reasonable opinion of the Collateral
Agent, desirable to maintain the security interest of the Collateral Agent in
the Collateral intended to be granted hereby at all times fully perfected and in
full force and effect and (iii) the Collateral Agent shall have received
evidence that all other actions (including, without limitation, the payment of
all filing fees and taxes, if any, payable in connection with such filings) have
been taken, in order to perfect (and maintain the perfection and priority of)
the security interest granted hereby. In addition, to the extent that any
Assignor does not have an organizational identification number on the date
hereof and later obtains one, such Assignor shall promptly thereafter notify the
Collateral Agent of such organizational identification number and shall take all
actions reasonably satisfactory to the Collateral Agent to the extent necessary
to maintain the security interest of the Collateral Agent in the Collateral
intended to be granted hereby fully perfected and in full force and effect.
2.7 Recourse. This Agreement is made with full recourse to such
Assignor and pursuant to and upon all the warranties, representations,
covenants, and agreements on the part of such Assignor contained herein, in the
other Credit Documents, in the Secured Hedging Agreements, in the Existing
Senior Notes Documents and in the Refinancing Senior Notes Documents, and
otherwise in writing in connection herewith or therewith.
2.8 Jurisdiction and Type of Organization. The jurisdiction of
organization of each Assignor, and the type of organization of each Assignor, as
of the date hereof, is listed on
Exhibit I
Page 8
Annex I hereto for such Assignor. No Assignor shall change its jurisdiction of
organization or its type of organization until (i) it shall have given to the
Collateral Agent not less than 15 days' prior written notice of intention so to
do, clearly describing such new jurisdiction of organization and/or type of
organization and providing such other information in connection therewith as the
Collateral Agent may reasonably request and (ii) with respect to such new
jurisdiction of organization and/or type of organization, it shall have taken
all actions reasonably requested by the Collateral Agent to maintain the
security interest of the Collateral Agent in the Collateral intended to be
granted hereby at all times fully perfected and in full force and effect.
2.9 Collateral in the Possession of a Bailee. If any Inventory or
other Goods are at any time in the possession of a bailee, the respective
Assignor shall promptly notify the Collateral Agent thereof and, if requested by
the Collateral Agent, shall use its reasonable best efforts to promptly obtain
an acknowledgment from such bailee, in form and substance reasonably
satisfactory to the Collateral Agent, that the bailee holds such Collateral for
the benefit of the Collateral Agent and shall act upon the instructions of the
Collateral Agent, without the further consent of the respective Assignor. The
Collateral Agent agrees with the Assignors that the Collateral Agent 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.
2.10 As-Extracted Collateral; Timber-to-be-Cut. As of the date
hereof, no Assignor owns, or expects to acquire, any property which constitutes,
or would constitute, As-Extracted Collateral or Timber-to-be-Cut. If at any time
after the date hereof any Assignor owns, acquires or obtains rights to any
As-Extracted Collateral or Timber-to-be-Cut, such Assignor shall furnish the
Collateral Agent 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 Agent to perfect the security interest
of the Collateral Agent therein.
ARTICLE III
SPECIAL PROVISIONS CONCERNING
RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS
3.1 Additional Representations and Warranties. As of the time when
each of its Receivables arises, each Assignor shall be deemed to have
represented and warranted that such Receivable, and all material records, papers
and documents relating thereto (if any) are genuine and in all material respects
what they purport to be, and that all papers and documents (if any) relating
thereto (i) will be the only original writings evidencing and embodying such
obligation of the account debtor named therein (other than copies created for
general accounting purposes) and (ii) will, to the knowledge of such Assignor,
evidence true and valid obligations of the account debtor named therein.
3.2 Maintenance of Records. Each Assignor will keep and maintain at
its own cost and expense satisfactory and complete records of its Receivables
and Contracts, and such Assignor will make the same available to the Collateral
Agent for inspection, at such Assignor's
Exhibit I
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own cost and expense, at any and all reasonable times (i.e., during normal
business hours) and upon reasonable prior notice to such Assignor. If requested
by the Collateral Agent while an Event of Default is in existence, such Assignor
shall, at its own cost and expense, deliver all tangible evidence of its
Receivables and Contract Rights (including, without limitation, copies of all
documents evidencing the Receivables and all Contracts) and such books and
records to the Collateral Agent or to its representatives (copies of which
evidence and books and records may be retained by such Assignor). If the
Collateral Agent so directs, upon the occurrence and during the continuance of
an Event of Default, such Assignor shall legend, in form and manner reasonably
satisfactory to the Collateral Agent, the Receivables and Contracts, as well as
books, records and documents of such Assignor evidencing or pertaining to such
Receivables with an appropriate reference to the fact that such Receivables and
Contracts have been assigned to the Collateral Agent and that the Collateral
Agent has a security interest therein.
3.3 Modification of Terms; etc. No Assignor shall rescind or cancel
any indebtedness evidenced by any Receivable or under any Contract, or modify
any term thereof or make any 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 Receivable or Contract, or interest
therein, without the prior written consent of the Collateral Agent, except (i)
as permitted by Section 3.4 hereof and (ii) in accordance with such Assignor's
reasonable business practices. Each Assignor will duly fulfill all obligations
on its part to be fulfilled under or in connection with all material Receivables
and Contracts and will do nothing to impair the rights of the Collateral Agent
in the Receivables or Contracts.
3.4 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 Receivables or obligor under any 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 Receivable or Contract,
and apply forthwith upon receipt thereof all such amounts as are so collected to
the outstanding balance of such Receivable or under such Contract, except that,
so long as no Event of Default is then in existence in respect of which the
Collateral Agent has given notice that this exception is no longer applicable,
any Assignor may allow in the ordinary course of business as adjustments to
amounts owing under its Receivables and 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 sound business
judgment and (ii) a refund or credit due as a result of returned or damaged
merchandise or improperly performed services. The reasonable costs and expenses
(including, without limitation, attorneys' fees) of collection, whether incurred
by any Assignor or the Collateral Agent, shall be borne by such Assignor.
3.5 Direction to Account Debtors; etc. Upon the occurrence and
during the continuance of a Noticed Event of Default, and if the Collateral
Agent so directs any Assignor, to the extent permitted by applicable law, such
Assignor agrees (x) to cause all payments on account of the Receivables and
Contracts to be made directly to the Cash Collateral Account, (y) that the
Collateral Agent may, at its option, directly notify the obligors with respect
to any Receivables and/or under any Contracts to make payments with respect
thereto as provided in preceding clause (x) and (z) that the Collateral Agent
may enforce collection of any Receivables or Contracts and may adjust, settle or
compromise the amount of payment thereof, in the same
Exhibit I
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manner and to the same extent as the Assignor. The Collateral Agent may apply
any or all amounts then in, or thereafter deposited in, the Cash Collateral
Account in the manner provided in Section 7.4 of this Agreement. The reasonable
costs and expenses (including reasonable attorneys' fees) of collection, whether
incurred by any Assignor or the Collateral Agent, shall be borne by such
Assignor. The Collateral Agent shall deliver a copy of each notice referred to
in the preceding clause (y) to the relevant Assignor; provided that, the failure
of the Collateral Agent to so notify such Assignor shall not affect the
effectiveness of such notice or the other rights of the Collateral Agent created
by this Section 3.5.
3.6 Instruments. If any Assignor owns or acquires any Instrument,
such Assignor will within 30 Business Days notify the Collateral Agent thereof,
and upon request by the Collateral Agent promptly deliver such Instrument (other
than checks payable to any Assignor and processed in the ordinary course of
business) to the Collateral Agent appropriately endorsed to the order of the
Collateral Agent as further security hereunder.
3.7 Further Actions. Each Assignor will, at its own expense, make,
execute, endorse, acknowledge, file and/or deliver to the Collateral Agent from
time to time such vouchers, invoices, schedules, confirmatory assignments,
conveyances, financing statements, transfer endorsements, powers of attorney,
certificates, reports and other assurances or instruments 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 Receivables, Contracts,
Instruments and other property or rights covered by the security interest hereby
granted, as the Collateral Agent may reasonably require to give effect to the
purposes of this Agreement.
3.8 Assignors Remain Liable Under Receivables and Contracts.
Anything herein to the contrary notwithstanding, the Assignors shall remain
liable under each of the Receivables and each Contract to observe and perform
all of the conditions and obligations to be observed and performed by them
thereunder, all in accordance with the terms of the agreement giving rise to
such Receivables or such Contract. Neither the Collateral Agent nor any other
Secured Creditor shall have any obligation or liability under any Receivable (or
any agreement giving rise thereto) or any Contract by reason of or arising out
of this Agreement or the receipt by the Collateral Agent or any other Secured
Creditor of any payment relating to such Receivable or such Contract pursuant
hereto, nor shall the Collateral Agent or any other Secured Creditor be
obligated in any manner to perform any of the obligations of any Assignor under
or pursuant to any Receivable (or any agreement giving rise thereto) or any
Contract, 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 Receivable (or any agreement giving rise
thereto) or any Contract, 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) No Assignor maintains, or at any time
after the date hereof shall establish or maintain, any demand, time, savings,
passbook or similar account, except for such accounts maintained with a bank (as
defined in Section 9-102 of the UCC) whose jurisdiction (determined in
accordance with Section 9-304 of the UCC) is within a State of the United
States, provided that an Assignor may maintain or establish an account or
accounts outside of the United States on terms, and in circumstances, reasonably
acceptable to
Exhibit I
Page 11
the Collateral Agent, so long as (i) any amounts deposited in any such account
represent monies from revenue generated exclusively from operations outside of
the United States and (ii) the aggregate amount of cash in all such accounts
maintained outside the United States does not exceed an amount reasonably
satisfactory to the Collateral Agent (each such account outside the United
States meeting the foregoing requirements, a "Non-U.S. Deposit Account"). Annex
J hereto accurately sets forth, as of the date of this Agreement, for each
Assignor, each Deposit Account maintained by such Assignor (including a
description thereof and the respective account number), the name of the
respective bank with which such Deposit Account is maintained, and the
jurisdiction of the respective Bank with respect to such Deposit Account. For
each Perfected Deposit Account, the respective Assignor shall cause the bank
with which the Perfected Deposit Account is maintained to execute and deliver to
the Collateral Agent, within 60 days after the Third Restatement Effective Date
or, if later, at the time of the establishment of the respective Perfected
Deposit Account, a "control agreement" in the form of Annex L hereto
(appropriately completed), with such changes thereto as may be approved by the
Collateral Agent (such approval not to be unreasonably withheld). If any bank
with which a Perfected Deposit Account is maintained refuses to, or does not,
enter into such a "control agreement", then the respective Assignor shall
promptly (and in any event within 60 days after the Third Restatement Effective
Date or, if later, 60 days after the opening of such account) close the
respective Perfected Deposit Account and transfer all balances therein to the
Cash Collateral Account or another Perfected Deposit Account meeting the
requirements of this Section 3.9. If any bank with which a Perfected Deposit
Account is maintained refuses to subordinate all its claims with respect to such
Perfected Deposit Account to the Collateral Agent's security interest therein on
terms satisfactory to the Collateral Agent, then the Collateral Agent, at its
option, may (x) require that such Perfected Deposit Account be terminated in
accordance with the immediately preceding sentence or (y) agree to a "control
agreement" without such subordination, provided that in such event the
Collateral Agent may at any time, at its option, subsequently require that such
Perfected Deposit Account be terminated (within 60 days after notice from the
Collateral Agent) in accordance with the requirements of the immediately
preceding sentence.
(b) After the date hereof, no Assignor shall establish any new
demand, time, savings, passbook or similar account, except for Perfected Deposit
Accounts established and maintained with banks and meeting the requirements of
preceding clause (a). At the time any such Perfected Deposit Account is
established, the appropriate "control agreement" shall be entered into in
accordance with the requirements of preceding clause (a) and the respective
Assignor shall furnish to the Collateral Agent a supplement to Annex J hereto
containing the relevant information with respect to the respective Perfected
Deposit Account and the bank with which same is established.
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 Agent thereof and, at the
request of the Collateral Agent, such Assignor shall, pursuant to an agreement
in form and substance reasonably satisfactory to the Collateral Agent, 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 Agent of the
proceeds of any drawing under such letter of credit or (ii) arrange for the
Collateral Agent to become the transferee beneficiary of such letter of credit,
with each Assignor and the Collateral Agent agreeing, in each case, that the
proceeds of any drawing under the letter of credit are to be applied as provided
in
Exhibit I
Page 12
this Agreement after the occurrence and during the continuance of a Noticed
Event of Default (it being understood and agreed that at any time prior to the
occurrence of a Noticed Event of Default, such proceeds shall be directed to the
relevant Assignor).
3.11 Commercial Tort Claims. All Commercial Tort Claims of each
Assignor and any events or circumstances that would reasonably be expected to
give rise to any Commercial Tort Claims of each Assignor as of the date of this
Agreement are described in Annex K hereto. If any Assignor shall at any time and
from time to time after the date hereof become aware of any Commercial Tort
Claims or events or circumstances that would reasonably be expected to give rise
to a Commercial Tort Claim of such Assignor, 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 (i) promptly notify the
Collateral Agent thereof in a writing signed by such Assignor and describing the
details thereof and shall grant to the Collateral Agent in such writing a
security interest in all such Commercial Tort Claims 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 Agent and (ii) perform
all actions reasonably requested by the Collateral Agent to perfect such
security interest in such Commercial Tort Claims.
3.12 Chattel Paper. Upon the request of the Collateral Agent made at
any time or from time to time, each Assignor shall promptly furnish to the
Collateral Agent a list of all Electronic Chattel Paper held or owned by such
Assignor. Furthermore, if requested by the Collateral Agent, each Assignor shall
promptly take all actions which are reasonably practicable so that the
Collateral Agent has "control" of all Electronic Chattel Paper in accordance
with the requirements of Section 9-105 of the UCC. Each Assignor will promptly
(and in any event within 10 days) following any request by the Collateral Agent,
deliver all of its Tangible Chattel Paper to the Collateral Agent.
ARTICLE IV
SPECIAL PROVISIONS CONCERNING TRADEMARKS
4.1 Additional Representations and Warranties. Each Assignor
represents and warrants as of the date hereof that it is the true and lawful
owner of the United States Patent and Trademark Office registrations, and
applications for registrations, of the Marks listed in Annex D, Part I attached
hereto and that Annex D, Part I lists all the United States Patent and Trademark
Office, or the equivalent office thereof in any foreign country, registrations
and applications for registrations, of the Marks that such Assignor now owns or
uses in connection with its business. Each Assignor represents and warrants as
of the date hereof that except with respect to those licensed marks set forth in
Annex D, Part I, it owns, is licensed to use or otherwise has the right to use
all material Marks that it uses. Each Assignor further warrants as of the date
hereof that it is aware of no third party claim that any aspect of such
Assignor's present or contemplated business operations infringes or will
infringe any material Mark. Except as set forth on Annex D, Part II, each
Assignor represents and warrants as of the date hereof that it is the true and
lawful owner of or otherwise has the right to use all material U.S. trademark
registrations and applications listed in Annex D, Part I hereto and that said
registrations are valid,
Exhibit I
Page 13
subsisting, have not been cancelled and that such Assignor is not aware of any
third-party claim that any of said registrations or applications for
registration with respect to a Mark is invalid or unenforceable or is not aware
that there is any reason that any of said material registrations or applications
for registration with respect to a Mark is invalid or unenforceable, or that
there is any reason that any of said applications will not pass to registration.
Each Assignor represents and warrants that upon the recordation of an Assignment
of Security Interest in United States Trademarks and Patents in the form of
Annex G hereto in the United States Patent and Trademark Office, together with
filings on Form UCC-1 pursuant to this Agreement, all filings, registrations and
recordings necessary or appropriate to perfect the security interest granted to
the Collateral Agent in the United States Marks covered by this Agreement under
federal law will have been accomplished. Each Assignor agrees to execute such an
Assignment of Security Interest in United States Trademark and Patents covering
all of such Assignor's right, title and interest in each United States Mark, and
the associated goodwill, of such Assignor, and to record the same. Each Assignor
hereby grants to the Collateral Agent an absolute power of attorney to sign,
upon the occurrence and during the continuance of a Noticed Event of Default,
any document which may be required by the United States Patent and Trademark
Office in order to effect an absolute assignment of all such Assignor's right,
title and interest in each United States Mark owned by an Assignor, and record
the same.
4.2 Licenses and Assignments. Subject to the provisions of Sections
4.4 and 4.5, each Assignor hereby agrees not to divest itself of any right under
a Mark other than in the ordinary course of business absent prior written
approval of the Collateral Agent.
4.3 Infringements. Each Assignor agrees, promptly upon learning
thereof, to notify the Collateral Agent in writing of the name and address of,
and to furnish such pertinent information that may be available with respect to,
any party who may be infringing or otherwise violating in any material respect
any of such Assignor's rights in and to any Mark material to the operation of
its business, or with respect to any party claiming that such Assignor's use of
any Mark material to the operation of its business violates in any material
respect any property right of that party. Each Assignor further agrees, to
prosecute diligently any Person infringing in any material respect any Mark
owned by such Assignor in a manner consistent with its past practice and in
accordance with reasonable business practices.
4.4 Preservation of Marks. Each Assignor agrees to use or license
the use of its Marks in interstate commerce during the time in which this
Agreement is in effect, sufficiently to preserve such Marks as trademarks or
service marks registered under the laws of the United States or the relevant
foreign jurisdiction; provided, that no Assignor shall be obligated to preserve
any Mark in the event such Assignor determines, in its reasonable business
judgment, that the preservation of such Mark is no longer necessary in the
conduct of its business.
4.5 Maintenance of Registration. Each Assignor shall, at its own
expense, diligently process all documents required to maintain trademark
registrations, including but not limited to affidavits of use and applications
for renewals of registration in the United States Patent and Trademark Office or
equivalent governmental agency in any foreign jurisdiction for all of its Marks
(excluding unregistered 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
Exhibit I
Page 14
application of renewal prior to the exhaustion of all administrative and
judicial remedies without prior written consent of the Collateral Agent;
provided, that no Assignor shall be obligated to maintain any Mark or prosecute
any such application for registration in the event that such Assignor
determines, in its reasonable business judgment, that such Mark or application
is no longer necessary in the conduct of its business.
4.6 Future Registered Marks. If any Mark registration issues
hereafter to any Assignor as a result of any application now or hereafter
pending before the United States Patent and Trademark Office or equivalent
governmental agency in any foreign jurisdiction, at the time of the delivery (or
required delivery) of the annual or quarterly financial information of the
Borrower to the Lenders pursuant to Section 7.01(a) or (b), as the case may be,
of the Credit Agreement, such Assignor shall deliver a copy of the related
registration certificate, and a grant of security in such mark to the Collateral
Agent, confirming the grant thereof hereunder, the form of such confirmatory
grant to be substantially the same as the form of Annex G hereof or in such
other form as may be reasonably acceptable to the Collateral Agent.
4.7 Remedies. If a Noticed Event of Default shall occur and be
continuing, the Collateral Agent may, by written notice to the relevant
Assignor, 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, together
with all trademark rights and rights of protection to the same, vested, in which
event such rights, title and interest shall immediately vest, in the Collateral
Agent for the benefit of the relevant Secured Creditors pursuant to a trademark
security agreement in form and substance satisfactory to the Collateral Agent,
executed by such Assignor and filed on the date hereof, pursuant to which all of
such Assignor's rights, title and interest in and to the Marks are assigned to
the Collateral Agent for the benefit of the relevant Secured Creditors; (ii)
take and use or sell the Marks and the goodwill of such Assignor's business
symbolized by the Marks and the right to carry on the business and use the
assets of such Assignor in connection with which the Marks have been used; and
(iii) direct such Assignor to refrain, in which event such Assignor shall
refrain, from using the Marks in any manner whatsoever, directly or indirectly,
and, if requested by the Collateral Agent, change such Assignor's corporate name
to eliminate therefrom any use of any Mark and execute such other and further
documents that the Collateral Agent may request to further confirm this and to
transfer ownership of the Marks and registrations and any pending trademark
application in the United States Patent and Trademark Office or any equivalent
governmental agency or office in any foreign jurisdiction to the Collateral
Agent.
ARTICLE V
SPECIAL PROVISIONS CONCERNING
TRADE SECRET RIGHTS, PATENTS AND COPYRIGHTS
5.1 Additional Representations and Warranties. Except as set forth
in the Annexes attached hereto, each Assignor represents and warrants as of the
date hereof that it is the true and lawful owner or licensee of all rights in
(i) all Trade Secret Rights, (ii) the Patents of such Assignor listed in Annex E
attached hereto and that said Patents constitute all the patents and
applications for patents that such Assignor now owns and (iii) the Copyrights of
such
Exhibit I
Page 15
Assignor listed in Annex F attached hereto and that said Copyrights constitute
all the registered copyrights and applications for copyright registrations that
such Assignor now owns. Except as set forth on Annex F, each Assignor further
warrants as of the date hereof that it is aware of no third party claim that any
aspect of such Assignor's present or contemplated business operations infringes
or will infringe any material patent or any material copyright or that such
Assignor has misappropriated any material Trade Secret Rights. Each Assignor
represents and warrants that upon the recordation of an Assignment of Security
Interest in United States Trademarks and Patents in the form of Annex G hereto
in the United States Patent and Trademark Office and the recordation of an
Assignment of Security Interest in United States Copyrights in the form of Annex
H hereto in the United States Copyright Office, together with filings on Form
UCC-1 pursuant to this Agreement, all filings, registrations and recordings
necessary or appropriate to perfect the security interest granted to the
Collateral Agent in the United States Patents and United States Copyrights
covered by this Agreement under federal law will have been accomplished. Upon
obtaining any Patent, each Assignor agrees to execute an Assignment of Security
Interest in United States Trademarks and Patents covering all right, title and
interest in each United States Patent of such Assignor and to record the same,
and upon obtaining any registration of a Copyright, to execute such an
Assignment of Security Interest in United States Copyrights covering all right,
title and interest in each such registered United States Copyright of such
Assignor and to record the same. Each Assignor hereby grants to the Collateral
Agent an absolute power of attorney to sign, upon the occurrence and during the
continuance of any Event of Default, any document which may be required by the
U.S. Patent and Trademark Office or equivalent governmental agency in any
foreign jurisdiction or the U.S. Copyright Office or equivalent governmental
agency in any foreign jurisdiction in order to effect an absolute assignment of
all right, title and interest in each Patent and Copyright, and to record the
same.
5.2 Licenses and Assignments. Subject to the provisions of Sections
5.4 and 5.5, each Assignor hereby agrees not to divest itself of any right under
a Patent or Copyright other than in the ordinary course of business absent prior
written approval of the Collateral Agent.
5.3 Infringements. Each Assignor agrees, promptly upon learning
thereof, to furnish the Collateral Agent in writing with all pertinent
information available to such Assignor with respect to any material infringement
or other violation of such Assignor's rights in any Patent or Copyright, in each
case material to its business, or with respect to any claim that the practice of
any Patent or the use of any Copyright, in each case material to its business,
violates in any material respect any property right of a third party or with
respect to any misappropriation of any Trade Secret Right material to its
business or any claim that the practice of any Trade Secret Right material to
its business violates any property right of a third party. To the extent
consistent with its past practice and in accordance with reasonable business
practices, each Assignor further agrees, to prosecute diligently any Person
materially infringing any Patent or Copyright owned by such Assignor or any
Person misappropriating any Trade Secret Right.
5.4 Maintenance of Patents or Copyrights. At its own expense, each
Assignor shall make timely payment of all post-issuance fees required to
maintain in force rights under each of its Patents and Copyrights; provided,
that no Assignor shall be obligated to maintain any Patent in the event such
Assignor determines, in its reasonable business judgment, that the maintenance
of such Patent is no longer necessary in the conduct of its business.
Exhibit I
Page 16
5.5 Prosecution of Patent or Copyright Application. At its own
expense, each Assignor shall diligently prosecute all applications for (i)
Patents of such Assignor listed on Annex E hereto and (ii) Copyrights listed on
Annex F hereto, and, in each case, shall not abandon any such application prior
to exhaustion of all administrative and judicial remedies, absent written
consent of the Collateral Agent, provided that no Assignor shall be obligated to
maintain any Patent or Copyright in the event such Assignor determines it is no
longer necessary in the conduct of its business.
5.6 Other Patents and Copyrights. At the time of the delivery (or
required delivery) of the annual or quarterly financial information of the
Borrower to the Lenders pursuant to Section 7.01(a) or (b), as the case may be,
of the Credit Agreement, the relevant Assignor shall deliver to the Collateral
Agent information of the type required by Annex E or Annex F hereto (as
applicable) relating to each newly acquired or issued Patent or Copyright
registration and each newly filed application for a Patent or Copyright
registration, as the case may be, with a grant of security as to such Patent or
Copyright, as the case may be, confirming the grant thereof hereunder, the form
of such confirmatory grant to be substantially in the form of Annex G or Annex
H, as the case may be, hereto; provided, that no Assignor (i) shall be obligated
to prosecute any application in the event such Assignor determines, in its
reasonable business judgment, that such application is no longer necessary in
the conduct of its business and (ii) shall be obligated to provide a copy of a
Patent application or any other information with respect to an application for a
Patent or Copyright registration (other than the application date and filing
number and such other identifying information necessary to perfect a security
interest in the respective Patent or Copyright) if such Assignor reasonably
believes such information is confidential or such disclosure would materially
impair or prejudice Assignor's rights under such application or registration.
5.7 Remedies. If a Noticed Event of Default shall occur and be
continuing, the Collateral Agent may by written notice to the relevant Assignor
take any or all of the following actions: (i) declare the entire right, title
and interest of such Assignor in each of the Patents and Copyrights vested, in
which event such right, title and interest shall immediately vest in the
Collateral Agent for the benefit of the relevant Secured Creditors, pursuant to
a patent security agreement or copyright security agreement, as the case may be,
in form and substance satisfactory to the Collateral Agent, executed by such
Assignor and filed on the date hereof, pursuant to which all of such Assignor's
right, title, and interest to such Patents and Copyrights are assigned to the
Collateral Agent for the benefit of the relevant Secured Creditors; (ii) take
and practice, use or sell the Patents and Copyrights; (iii) direct such Assignor
to refrain, in which event such Assignor shall refrain, from practicing the
Patents and using the Copyrights directly or indirectly, and such Assignor shall
execute such other and further documents as the Collateral Agent may request
further to confirm this and to transfer ownership of the Patents and Copyrights
to the Collateral Agent for the benefit of the relevant Secured Creditors.
Exhibit I
Page 17
ARTICLE VI
PROVISIONS CONCERNING ALL COLLATERAL
6.1 Protection of Collateral Agent's Security. Each Assignor will at
all times keep its Inventory and Equipment insured in favor of the Collateral
Agent, at its own expense, to the extent required by the Credit Agreement;
copies of all policies or certificates with respect to such insurance (i) shall
be endorsed to the Collateral Agent's reasonable satisfaction for the benefit of
the Collateral Agent (including, without limitation, by naming the Collateral
Agent as loss payee and the Collateral Agent and the other relevant Secured
Creditors as additional insureds), (ii) shall state that such insurance policies
shall not be cancelled or materially revised without at least 30 days' (or at
least 10 days' in the case of nonpayment of premium) prior written notice
thereof by the insurer to the Collateral Agent and (iii) shall be deposited with
the Collateral Agent. If any Assignor shall fail to insure such Inventory or
Equipment to the extent required by the Credit Agreement, or if any Assignor
shall fail to so endorse and deposit copies of all policies or certificates with
respect thereto, the Collateral Agent shall have the right (but shall be under
no obligation), upon prior written notice to such Assignor, to procure such
insurance and such Assignor agrees to reimburse the Collateral Agent for all
reasonable costs and expenses of procuring such insurance. Except as otherwise
provided in the Credit Agreement, the Collateral Agent shall apply any proceeds
of such insurance required after a Noticed Event of Default in accordance with
Section 7.4 (it being understood that so long as no Noticed Event of Default has
occurred and is continuing, the Collateral Agent will release any interest it
has in the proceeds of any casualty insurance to the Assignors). Each Assignor
assumes all liability and responsibility in connection with the Collateral
acquired by it and the liability of such Assignor to pay its Obligations shall
in no way be affected or diminished by reason of the fact that such Collateral
may be lost, destroyed, stolen, damaged or for any reason whatsoever unavailable
to such Assignor.
6.2 Further Actions. Each Assignor will, at its own expense, make,
execute, endorse, acknowledge, file and/or deliver to the Collateral Agent from
time to time such lists, descriptions and designations of its Collateral,
warehouse receipts, receipts in the nature of warehouse receipts, bills of
lading, documents of title, vouchers, invoices, schedules, confirmatory
assignments, conveyances, financing statements, transfer endorsements, powers of
attorney, certificates, reports and other assurances or instruments and take
such further steps relating to the Collateral and other property or rights
covered by the security interest hereby granted, which the Collateral Agent
deems reasonably appropriate or advisable to perfect, preserve or protect its
security interest in the Collateral.
6.3 Financing Statements. Each Assignor agrees to execute and
deliver to the Collateral Agent such financing statements, in form acceptable to
the Collateral Agent, as the Collateral Agent may from time to time reasonably
request or as are reasonably necessary or desirable in the reasonable opinion of
the Collateral Agent to establish and maintain a valid, enforceable, first
priority perfected security interest in the Collateral (subject to the Permitted
Liens) as provided herein and the other rights and security contemplated hereby
all in accordance with the Uniform Commercial Code as enacted in any and all
relevant jurisdictions or any other relevant law. Each Assignor will pay any
applicable filing fees, recordation taxes and related expenses. Each Assignor
hereby authorizes the Collateral Agent to file any such financing
Exhibit I
Page 18
statements (including, without limitation, (x) financing statements which list
the Collateral specifically and/or "all assets" as collateral and (y) "in lieu
of" financing statements) without the signature of such Assignor where permitted
by law.
6.4 Additional Information. Each Assignor will, at its own expense,
from time to time upon the reasonable request of the Collateral Agent, promptly
(and in any event within 10 days after its receipt of the respective request)
furnish to the Collateral Agent such information with respect to the Collateral
(including the identity of the Collateral or such components thereof as may have
been requested by the Collateral Agent, the value and location of such
Collateral, etc.) as may be requested by the Collateral Agent. Without limiting
the forgoing, each Assignor agrees that it shall promptly (and in any event
within 10 days after its receipt of the respective request) furnish to the
Collateral Agent such updated Annexes hereto as may from time to time be
reasonably requested by the Collateral Agent.
ARTICLE VII
REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT
7.1 Remedies; Obtaining the Collateral Upon Default. Each Assignor
agrees that, if a Noticed Event of Default shall have occurred and be
continuing, then and in every such case, subject to any mandatory requirements
of applicable law then in effect, the Collateral Agent, in addition to any
rights now or hereafter existing under applicable law and under the other
provisions of this Agreement, shall have all rights as a secured creditor under
the Uniform Commercial Code in all relevant jurisdictions and such additional
rights and remedies to which a secured creditor is entitled under the laws in
effect in all relevant jurisdictions and may also:
(i) personally, or by agents or attorneys, immediately take
possession of the Collateral or any part thereof, from such Assignor or
any other Person who then has possession of any part thereof with or
without notice or process of law, and for that purpose may enter upon such
Assignor's premises where any of the Collateral is located and remove the
same and use in connection with such removal any and all services,
supplies, aids and other facilities of such Assignor;
(ii) instruct the obligor or obligors on any agreement, instrument
or other obligation (including, without limitation, the Receivables and
the Contracts) constituting the Collateral to make any payment required by
the terms of such instrument or agreement directly to the Collateral Agent
and may exercise any and all remedies of such Assignor in respect of such
Collateral;
(iii) instruct all banks which have entered into a control agreement
with the Collateral Agent to transfer all moneys, securities and
instruments held by such depository bank to the Cash Collateral Account
and withdraw all moneys, securities and instruments in the Cash Collateral
Account for application to the Obligations in accordance with Section 7.4
hereof;
Exhibit I
Page 19
(iv) sell, assign or otherwise liquidate, or direct such Assignor to
sell, assign or otherwise liquidate, any or all of the Collateral or any
part thereof in accordance with Section 7.2 hereof, and take possession of
the proceeds of any such sale or liquidation;
(v) take possession of the Collateral or any part thereof, by
directing such Assignor in writing to deliver the same to the Collateral
Agent at any place or places reasonably designated by the Collateral
Agent, in which event such Assignor shall at its own expense:
(A) forthwith cause the same to be moved to the place or
places so designated by the Collateral Agent and there delivered to
the Collateral Agent,
(B) store and keep any Collateral so delivered to the
Collateral Agent at such place or places pending further action by
the Collateral Agent as provided in Section 7.2, and
(C) while the Collateral shall be so stored and kept, provide
such guards, other security and maintenance services as shall be
necessary to protect the same and to preserve and maintain them in
good condition;
(vi) license or sublicense whether on an exclusive or nonexclusive
basis, any Marks, Patents or Copyrights included in the Collateral for
such term and on such conditions and in such manner as the Collateral
Agent shall in its sole judgment determine;
(vii) apply any moneys constituting Collateral or proceeds thereof
in accordance with Section 8.4; and
(viii) take any other action as specified in clauses (1) through
(5), inclusive, of Section 9-607 of the UCC.
it being understood that such Assignor's obligation so to deliver the Collateral
is of the essence of this Agreement and that, accordingly, upon application to a
court of equity having jurisdiction, the Collateral Agent shall be entitled to a
decree requiring specific performance by such Assignor of said obligation. By
accepting the benefits of this Agreement and each other Security Document, the
Secured Creditors expressly acknowledge and agree that (x) this Agreement and
each other Security Document may be enforced only by the action of the
Collateral Agent acting upon the instructions of the Required Lenders or, if the
CA Termination Date has occurred, the holders of a majority of the outstanding
principal amount of all remaining Obligations, provided that if prior to the CA
Termination Date a payment default with respect to at least $300,000,000
principal amount in the aggregate of Existing Senior Notes and/or Refinancing
Senior Notes has continued for at least 180 days (and such defaulted payment has
not been received pursuant to a drawing under any letter of credit), the holders
of a majority of the outstanding principal amount of the Indebtedness subject to
such payment default or defaults can direct the Collateral Agent to commence and
continue enforcement of the Liens created hereunder, which the Collateral Agent
shall comply with subject to receiving any indemnity which it reasonably
requests, provided further that the Collateral Agent shall thereafter comply
only with the directions of the Required Lenders as to carrying out such
enforcement so long as such directions are not adverse to the
Exhibit I
Page 20
aforesaid directions of the holders of Indebtedness subject to such payment
default or defaults, and (y) no other Secured Creditor shall have any right
individually to seek to enforce or to enforce this Agreement or any other
Security Document or to realize upon the security to be granted hereby or
thereby, it being understood and agreed that such rights and remedies shall be
exercised exclusively by the Collateral Agent for the benefit of the Secured
Creditors as their interest may appear upon the terms of this Agreement and the
other Security Documents.
7.2 Remedies; Disposition of the Collateral. Upon the occurrence and
continuance of a Noticed Event of Default, any Collateral repossessed by the
Collateral Agent under or pursuant to Section 7.1 and any other Collateral
whether or not so repossessed by the Collateral Agent, may be sold, assigned,
leased or otherwise disposed of under one or more contracts or as an entirety,
and without the necessity of gathering at the place of sale the property to be
sold, and in general in such manner, at such time or times, at such place or
places and on such terms as the Collateral Agent may, in compliance with any
mandatory requirements of applicable law, determine to be commercially
reasonable. Any of the Collateral may be sold, leased or otherwise disposed of,
in the condition in which the same existed when taken by the Collateral Agent or
after any overhaul or repair which the Collateral Agent shall determine to be
commercially reasonable. Any such disposition which shall be a private sale or
other private proceedings permitted by such requirements shall be made upon not
less than ten (10) days' written notice to the relevant Assignor specifying the
time at which such disposition is to be made and the intended sale price or
other consideration therefor, and shall be subject, for the ten (10) days after
the giving of such notice, to the right of the relevant Assignor or any nominee
of such Assignor to acquire the Collateral involved at a price or for such other
consideration at least equal to the intended sale price or other consideration
so specified. Any such disposition which shall be a public sale permitted by
such requirements shall be made upon not less than ten (10) days' written notice
to the relevant Assignor specifying the time and place of such sale and, in the
absence of applicable requirements of law, shall be by public auction (which
may, at the Collateral Agent's option, be subject to reserve), after publication
of notice of such auction not less than 10 days prior thereto in one newspaper
in general circulation in the City of New York and one newspaper in general
circulation in Winston Salem, North Carolina. To the extent permitted by any
such requirement of law, the Collateral Agent on behalf of the Secured Creditors
(or certain of them) may bid for and become the purchaser (by bidding in the
Obligations or otherwise) of the Collateral or any item thereof, offered for
sale in accordance with this Section without accountability to the relevant
Assignor (except to the extent of surplus money received as provided in Section
7.4). If, under mandatory requirements of applicable law, the Collateral Agent
shall be required to make disposition of the Collateral within a period of time
which does not permit the giving of notice to the relevant Assignor as
hereinabove specified, the Collateral Agent need give such Assignor only such
notice of disposition as shall be reasonably practicable in view of such
mandatory requirements of applicable law.
7.3 Waiver of Claims. Except as otherwise provided in this
Agreement, EACH ASSIGNOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE COLLATERAL AGENT'S
TAKING POSSESSION OR THE COLLATERAL AGENT'S DISPOSITION OF ANY OF THE
COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING
FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH SUCH ASSIGNOR
WOULD OTHERWISE HAVE
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UNDER THE CONSTITUTION OR ANY STATUTE OF THE UNITED STATES OR OF ANY STATE, and
such Assignor hereby further waives, to the extent permitted by law:
(i) all damages occasioned by such taking of possession or any such
disposition except any damages which are the direct result of the
Collateral Agent's gross negligence or wilful misconduct;
(ii) all other requirements as to the time, place and terms of sale
or other requirements with respect to the enforcement of the Collateral
Agent's rights hereunder; and
(iii) all rights of redemption, appraisement, valuation, stay,
extension or moratorium now or hereafter in force under any applicable law
in order to prevent or delay the enforcement of this Agreement or the
absolute sale of the Collateral or any portion thereof, and each Assignor,
for itself and all who may claim under it, insofar as it or they now or
hereafter lawfully may, hereby waives the benefit of all such laws.
Any sale of, or the grant of options to purchase, or any other realization upon,
any Collateral shall operate to divest all right, title, interest, claim and
demand, either at law or in equity, of the relevant Assignor therein and
thereto, and shall be a perpetual bar both at law and in equity against such
Assignor and against any and all Persons claiming or attempting to claim the
Collateral so sold, optioned or realized upon, or any part thereof, from,
through and under such Assignor.
7.4 Application of Proceeds. (a) All moneys collected by the
Collateral Agent upon any sale, other disposition of or other realization upon
any Collateral, together with all other moneys received by the Collateral Agent
hereunder (collectively, the "Collateral Proceeds"), shall be applied as
follows:
(i) first, to the payment of all Obligations owing to the Collateral
Agent of the type described in clauses (v), (vi) and (vii) of the
definition of "Obligations" contained in Article IX hereof;
(ii) second, to the extent proceeds of the sale, any disposition of
or other realization upon any item of Collateral remain after the
application pursuant to preceding clause (i), an amount equal to the
outstanding Applicable Obligations secured by such item of Collateral
shall be paid to the Secured Creditors in the manner provided below as
their interests may appear, with each Secured Creditor receiving an amount
equal to its outstanding Applicable Obligations secured by such item of
Collateral or, if the proceeds are insufficient to pay in full all such
Applicable Obligations, its Pro Rata Share of the amount so remaining to
be distributed, with any such amount to be applied in the case of the
Credit Document Obligations, the Existing Senior Notes Obligations and the
Refinancing Senior Notes Obligations, first to the payment of interest in
respect of the unpaid principal amount of Loans, Existing Senior Notes or
Refinancing Senior Notes, as the case may be, second to the payment of
principal of Loans, Existing Senior Notes or Refinancing Senior Notes, as
the case may be, and third to the other Credit Document
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Obligations, Existing Senior Notes Obligations or Refinancing Senior Notes
Obligations, as the case may be; and
(iii) third, to the extent proceeds remain after the application
pursuant to the preceding clauses (i) and (ii), to the relevant Assignor
or, to the extent directed by such Assignor or a court of competent
jurisdiction, to whomever may be lawfully entitled to receive such
surplus.
(b) For purposes of this Agreement, "Pro Rata Share" shall mean when
calculating a Secured Creditor's portion of any distribution or amount pursuant
to Section 7.4(a), the amount (expressed as a percentage) equal to a fraction
the numerator of which is the then outstanding amount of the relevant Applicable
Obligations secured by the relevant item of Collateral owed such Secured
Creditor and the denominator of which is the then outstanding amount of all
Applicable Obligations secured by the relevant item of Collateral.
(c) All payments required to be made to the (i) Lender Creditors
hereunder shall be made to the Administrative Agent for the account of the
respective Lender Creditors, (ii) Credit Card Issuers hereunder shall be made to
the Credit Card Issuer(s) under the applicable Secured Credit Card Agreement,
(iii) Hedging Creditors hereunder shall be made to the paying agent under the
applicable Secured Hedging Agreement or, in the case of Secured Hedging
Agreements without a paying agent, directly to the applicable Hedging Creditors,
(iv) Existing Senior Notes Creditors hereunder shall be made to the Existing
Senior Notes Trustee for the account of the respective Existing Senior Notes
Creditors, and (v) Refinancing Senior Notes Creditors hereunder shall be made to
the Refinancing Senior Notes Trustee for the account of the respective
Refinancing Senior Notes Creditors.
(d) For purposes of applying payments received in accordance with
this Section 7.4, the Collateral Agent shall be entitled to rely upon (i) the
Administrative Agent for a determination of the outstanding Credit Document
Obligations, (ii) any Credit Card Issuer for a determination of the outstanding
Credit Card Obligations owed to such Credit Card Issuer, (iii) any Hedging
Creditor for a determination of the outstanding Hedging Obligations owed to such
Hedging Creditor, (iv) the Existing Senior Notes Trustee for a determination of
the outstanding Existing Senior Notes Obligations and (v) the Refinancing Senior
Notes Trustee for a determination of the outstanding Refinancing Senior Notes
Obligations. Unless it has actual knowledge (including by way of written notice
from a Secured Creditor) to the contrary, the Administrative Agent under the
Credit Agreement, in furnishing information pursuant to the preceding sentence,
and the Collateral Agent, in acting hereunder, shall be entitled to assume that
no Credit Document Obligations other than principal, interest and regularly
accruing fees are owing to any Lender Creditor.
(e) It is understood that each Assignor shall remain liable to the
extent of any deficiency between (x) the amount of the obligations for which it
is liable directly or as a Guarantor that are satisfied with proceeds of the
Collateral and (y) the aggregate outstanding amount of such Obligations.
7.5 Remedies Cumulative. Each and every right, power and remedy
hereby specifically given to the Collateral Agent shall be in addition to every
other right, power and
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remedy specifically given under this Agreement, any Secured Credit Card
Agreement, any Secured Hedging Agreement, the other Credit Documents, any
Existing Senior Notes Document or any Refinancing Senior Notes Document or now
or hereafter existing at law or in equity, or by statute and each and every
right, power and remedy whether specifically herein given or otherwise existing
may be exercised from time to time or simultaneously and as often and in such
order as may be deemed expedient by the Collateral Agent. All such rights,
powers and remedies shall be cumulative and the exercise or the beginning of
exercise of one shall not be deemed a waiver of the right to exercise of any
other or others. No delay or omission of the Collateral Agent in the exercise of
any such right, power or remedy and no renewal or extension of any of the
Obligations shall impair any such right, power or remedy or shall be construed
to be a waiver of any Default or Event of Default or an acquiescence therein. In
the event that the Collateral Agent shall bring any suit to enforce any of its
rights hereunder and shall be entitled to judgment, then in such suit the
Collateral Agent may recover expenses, including attorneys' fees, and the
amounts thereof shall be included in such judgment.
7.6 Discontinuance of Proceedings. In case the Collateral Agent
shall have instituted any proceeding to enforce any right, power or remedy under
this Agreement by foreclosure, sale, entry or otherwise, and such proceeding
shall have been discontinued or abandoned for any reason or shall have been
determined adversely to the Collateral Agent, then and in every such case the
relevant Assignor, the Collateral Agent and each holder of any of the
Obligations shall be restored to their former positions and rights hereunder
with respect to the Collateral subject to the security interest created under
this Agreement, and all rights, remedies and powers of the Collateral Agent
shall continue as if no such proceeding had been instituted (except to the
extent of a determination adverse to the Collateral Agent in such a proceeding).
ARTICLE VIII
INDEMNITY
8.1 Indemnity. (a) Each Assignor jointly and severally agrees to
indemnify, reimburse and hold the Collateral Agent, each other Secured Creditor
and their respective successors, permitted assigns, employees, agents and
servants (hereinafter in this Section 8.1 referred to individually, as
"Indemnitee," and collectively as "Indemnitees") harmless from any and all
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
suits, judgments and any and all reasonable costs and expenses (including
reasonable attorneys' fees and expenses) (for the purposes of this Section 8.1
the foregoing are collectively called "expenses") of whatsoever kind and nature
imposed on, asserted against or incurred by any of the Indemnitees in any way
relating to or arising out of this Agreement, or the documents executed in
connection herewith or in any other way connected with the enforcement of any of
the terms of, or the preservation of any rights hereunder, or in any way
relating to or arising out of the manufacture, ownership, ordering, purchase,
delivery, control, acceptance, lease, financing, possession, operation,
condition, sale, return or other disposition, or use of the Collateral
(including, without limitation, latent or other defects, whether or not
discoverable), the violation of the laws of any country, state or other
governmental body or unit, any tort (including, without limitation, claims
arising or imposed under the doctrine of strict liability, or for or on account
of injury to or the death of any Person (including any Indemnitee), or property
damage), or contract
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claim; provided that no Indemnitee shall be indemnified pursuant to this Section
8.1(a) for expenses, losses, damages or liabilities to the extent caused by the
gross negligence or wilful misconduct of such Indemnitee. Each Assignor agrees
that upon written notice by any Indemnitee of the assertion of such a liability,
obligation, loss, damage, penalty, claim, demand, action, judgment or suit, such
Assignor shall assume full responsibility for the defense thereof. Each
Indemnitee agrees to use its best efforts to promptly notify such Assignor of
any such assertion of which such Indemnitee has knowledge.
(a) Without limiting the application of Section 8.1(a), each
Assignor agrees, jointly and severally, to pay, or reimburse the Collateral
Agent for (if the Collateral Agent shall have incurred fees, costs or expenses
because such Assignor shall have failed to comply with its obligations under
this Agreement) any and all reasonable fees, costs and expenses of whatever kind
or nature incurred in connection with the creation, preservation or protection
of the Collateral Agent's Liens on, and security interest in, the Collateral,
including, without limitation, all fees and taxes in connection with the
recording or filing of instruments and documents in public offices, payment or
discharge of any taxes or Liens upon or in respect of the Collateral, premiums
for insurance with respect to the Collateral and all other reasonable fees,
costs and expenses in connection with protecting, maintaining or preserving the
Collateral and the Collateral Agent's interest therein, whether through judicial
proceedings or otherwise, or in defending or prosecuting any actions, suits or
proceedings arising out of or relating to the Collateral. Any reference in this
Agreement, to "fees of counsel" or other similar phraseology shall mean the
actual and reasonable fees incurred at customary and reasonable hourly rates in
the jurisdiction in which the services of such counsel are performed, not
pursuant to any statutory formula or percentage calculation.
(b) Without limiting the application of Section 8.1(a) or (b), each
Assignor jointly and severally agrees to pay, indemnify and hold each Indemnitee
harmless from and against any loss, costs, damages and expenses which such
Indemnitee may suffer, expend or incur in consequence of or growing out of any
material misrepresentation by an Assignor in this Agreement, or in any statement
or writing contemplated by or made or delivered pursuant to or in connection
with this Agreement.
(c) If and to the extent that the obligations of any Assignor under
this Section 8.1 are unenforceable for any reason, each Assignor hereby agrees
to make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law.
8.2 Indemnity Obligations Secured by Collateral; Survival. Any
amounts paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral. The
indemnity obligations of each Assignor contained in this Article VIII shall
continue in full force and effect notwithstanding the full payment of all the
Notes issued under the Credit Agreement, the termination of all Secured Hedging
Agreements, the full payment of all Existing Senior Notes issued under the
Existing Senior Notes Indenture, the full payment of all Refinancing Senior
Notes issued under the Refinancing Senior Notes Indenture and the payment of all
of the other Obligations and notwithstanding the discharge thereof.
Exhibit I
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ARTICLE IX
DEFINITIONS
The following terms shall have the meanings herein specified unless
the context otherwise requires. Such definitions shall be equally applicable to
the singular and plural forms of the terms defined.
"Administrative Agent" shall have the meaning provided in the
recitals to this Agreement.
"Agreement" shall mean this Security Agreement, as the same may be
modified, supplemented or amended from time to time in accordance with its
terms.
"As-Extracted Collateral" shall mean "as-extracted collateral" as
such term is defined in the Uniform Commercial Code as in effect on the date
hereof in the State of New York.
"Assignor" shall have the meaning specified in the first paragraph
of this Agreement.
"Applicable Obligations" shall mean (x) for each Assignor that is a
Specified Assignor, all the Obligations and (y) for each other Assignor, all the
Obligations other than the Existing Senior Notes Obligations and the Refinancing
Senior Notes Obligations, provided that (i) the Existing Senior Notes
Obligations shall be excluded from the Applicable Obligations of a Specified
Assignor to the extent the Existing Senior Notes Documents do not require the
Existing Senior Notes Obligations to be secured pursuant to this Agreement (or,
in the case of the Applicable Obligations of Parent, to the same extent the
Existing Senior Notes Obligations are excluded from the Applicable Obligations
of the Borrower as provided above in this clause (i)), and (ii) the Refinancing
Senior Notes Obligations shall be excluded from the Applicable Obligations of a
Specified Assignor to the extent the Refinancing Senior Notes Documents do not
require the Refinancing Senior Notes Obligations to be secured pursuant to this
Agreement (or, in the case of the Applicable Obligations of Parent, to the same
extent the Refinancing Senior Notes Obligations are excluded from the Applicable
Obligations of the Borrower as provided above in this clause (ii)).
"Business Day" means any day excluding Saturday, Sunday and any day
which shall be in the City of New York a legal holiday or a day on which banking
institutions are authorized by law to close.
"CA Termination Date" shall have the meaning provided in Section
10.9 hereof.
"Cash Collateral Account" shall mean a non-interest bearing cash
collateral account maintained with, and in the sole dominion and control of, the
Collateral Agent for the benefit of the Secured Creditors as their interests may
appear.
"Chattel Paper" shall mean "chattel paper" as such term is defined
in the Uniform Commercial Code as in effect on the date hereof in the State of
New York. Without limiting the
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foregoing, the term "Chattel Paper" shall in any event include all Tangible
Chattel Paper and all Electronic Chattel Paper.
"Class" shall have the meaning provided in Section 10.2 hereof.
"Collateral" shall have the meaning provided in Section 1.1(a)
hereof.
"Collateral Agent" shall have the meaning specified in the first
paragraph of this Agreement.
"Collateral Proceeds" shall have the meaning provided in Section
7.4(a) hereof.
"Commercial Tort Claims" shall mean "commercial tort claims" as such
term is defined in the Uniform Commercial Code as in effect on the date hereof
in the State of New York.
"Contract Rights" shall mean all rights of any Assignor under each
Contract, including, without limitation, (i) any and all rights to receive and
demand payments under any or all Contracts and Excluded Contracts, (ii) any and
all rights to receive and compel performance under any or all Contracts and
(iii) any and all other rights, interests and claims now existing or in the
future arising in connection with any or all Contracts.
"Contracts" shall mean all contracts between an Assignor and one or
more additional parties (including, without limitation, any Secured Credit Card
Agreement, any Secured Hedging Agreement and related documents entered into in
connection therewith) to the extent the grant by an Assignor of a security
interest pursuant to this Agreement in its right, title and interest in any such
contract is not prohibited by such contract (or, if prohibited, the consent of
each other party to such grant of a security interest is obtained) and would not
give any other party to such contract the right to terminate, or automatically
result in the termination of, such other party's obligations thereunder or the
Assignor's rights thereunder (those contracts where such grant is so prohibited
(and consent not obtained) or resulting in such a right of, or automatic,
termination are referred to herein as "Excluded Contracts").
"Copyrights" shall mean any United States or foreign copyright owned
by any Assignor now or hereafter, including any registration of any copyrights,
in the United States Copyright Office or the equivalent thereof in any foreign
country, as well as any application for a United States or foreign copyright
registration now or hereafter made with the United States Copyright Office or
the equivalent thereof in any foreign jurisdiction by any Assignor.
"Credit Agreement" shall have the meaning provided in the recitals
of this Agreement.
"Credit Card Issuer" shall have the meaning provided in the recitals
of this Agreement.
"Credit Card Obligations" shall have the meaning provided in the
definition of "Obligations" in this Article IX.
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"Credit Document Obligations" shall have the meaning provided in the
definition of "Obligations" in this Article IX.
"Deposit Accounts" shall mean all "deposit accounts" as such term is
defined in the Uniform Commercial Code as in effect on the date hereof in the
State of New York; provided that the term "Deposit Account" shall not include
any Excluded Escrow Account.
"Designated Collateral" shall have the meaning provided in Section
1.1(a) hereof.
"Documents" shall mean "documents" as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York.
"Electronic Chattel Paper" shall mean "electronic chattel paper" as
such term is defined in the Uniform Commercial Code as in effect on the date
hereof in the State of New York.
"Equipment" shall mean any "equipment," as such term is defined in
the Uniform Commercial Code as in effect on the date hereof in the State of New
York, now or hereafter owned by any Assignor and, in any event, shall include,
but shall not be limited to, all machinery, equipment, furnishings, fixtures now
or hereafter owned by such Assignor and any and all additions, substitutions and
replacements of any of the foregoing and all accessories hereto, wherever
located, together with all attachments, components, parts, equipment and
accessories installed thereon or affixed thereto but excluding (i) Equipment to
the extent it is subject to a Permitted Lien and the terms of the Indebtedness
securing such Permitted Liens prohibits assignment or granting of a security
interest in such Assignor's rights and obligations thereunder and (ii) certain
heat exchangers owned by the Assignor's on July 15, 2003 which are leased to
third-party tobacco growers and having an aggregate book value not exceeding
$2,600,000 on such date.
"Event of Default" shall mean any Event of Default under the Credit
Agreement, any "event of default" under the Existing Senior Notes Documents or
the Refinancing Senior Notes Documents or any payment default, after any
applicable grace period, under any Secured Credit Card Agreement or any Secured
Hedging Agreement.
"Excluded Contracts" shall have the meaning provided in the
definition of Contracts.
"Excluded Deposit Account" shall mean (i) the Cash Collateral
Account, (ii) payroll accounts, (iii) accounts used solely for disbursement
purposes, (iv) the five (5) certificates of deposit established with various
Lenders and identified as "Excluded Deposit Accounts" on Annex J hereto
(provided that such certificates of deposit shall be "Excluded Deposit Accounts"
only so long as the aggregate amount of cash and cash equivalents on deposit in
such accounts does not exceed $1,000,000 at any time) and (v) each Non-U.S.
Deposit Account.
"Excluded Escrow Accounts" shall mean (i) the account maintained
with the Bank of New York in which cash has been deposited for the benefit of
certain former
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shareholders of Nabisco Group Holdings and (ii) escrow accounts which
collateralize litigation appeal bonds or judgments being appealed by an
Assignor.
"Excluded Unperfected Collateral" shall mean and include (i)
Excluded Deposit Accounts (other than the Cash Collateral Account), (ii) any
motor vehicles or similar titled property a security interest over which may not
be perfected by the filing of a UCC-1 financing statement in the relevant
jurisdiction, (iii) Patents, Trademarks and Copyrights acquired or issued after
the date of this Agreement during (and only during) the period from such date of
acquisition or issuance to and including the 15th day following the date of the
required delivery of a confirmatory grant of security interest therein pursuant
to Section 4.6 or Section 5.6, as the case may be, (iv) during the 60 day period
prior to the required delivery of a "control agreement" with respect to a
Perfected Deposit Account pursuant to Section 3.9, the respective such Perfected
Deposit Account and (v) any Collateral acquired after the Third Restatement
Effective Date (or, if later, a given Trigger Date) during (and only during) the
period from such date of acquisition thereof to and including the 15th day
following such acquisition.
"Existing Senior Notes Creditors" shall have the meaning provided in
the recitals of this Agreement.
"Existing Senior Notes Documents" shall have the meaning provided in
the recitals of this Agreement.
"Existing Senior Notes Indenture" shall have the meaning provided in
the recitals of this Agreement.
"Existing Senior Notes Obligations" shall have the meaning provided
in the definition of "Obligations" in this Article IX.
"Existing Senior Notes Trustee" shall have the meaning provided in
the recitals of this Agreement.
"General Intangibles" mean "general intangibles" as such term is
defined in the Uniform Commercial Code as in effect on the date hereof in the
State of New York, but excluding those General Intangibles constituting Excluded
Contracts (other than any Receivable or any money(ies) due or to become due
under any such Excluded Contract).
"Goods" shall mean "goods" as such term is defined in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.
"Health-Care-Insurance Receivable" shall mean any
"health-care-insurance receivable" as such term is defined in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.
"Hedging Creditors" shall have the meaning provided in the recitals
of this Agreement.
"Hedging Obligations" shall have the meaning provided in the
definition of "Obligations" in this Article IX.
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"Indemnitee" shall have the meaning provided in Section 8.1 hereof.
"Instrument" shall mean "instrument" as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York; provided that the term "Instrument" shall not include (x) any Instrument
(as defined above in the absence of this proviso) pledged pursuant to the Pledge
Agreement or (y) the LSB Note (as defined in the Pledge Agreement).
"Inventory" shall mean merchandise, inventory and goods, and all
additions, substitutions and replacements thereof and all accessions thereto,
wherever located, together with all goods, supplies, incidentals, packaging
materials, labels, materials and any other items used or usable in
manufacturing, processing, packaging or shipping same; in all stages of
production from raw materials through work-in-process to finished goods and all
products and proceeds of whatever sort and wherever located and any portion
thereof which may be returned, rejected, reclaimed or repossessed by the
Collateral Agent from any Assignor's customers, and shall specifically include
all "inventory" as such term is defined in the Uniform Commercial Code as in
effect on the date hereof in the State of New York, now or hereafter owned by
any Assignor.
"Investment Property" shall mean "investment property" as such term
is defined in the Uniform Commercial Code as in effect on the date hereof in the
State of New York, provided that the term "Investment Property" shall not
include (i) Collateral (as defined in the Pledge Agreement) pledged pursuant to
the Pledge Agreement or (ii) "investment property" excluded pursuant to the
definition of "Investment Property" contained in the Pledge Agreement.
"Lender Creditors" shall have the meaning provided in the recitals
of this Agreement.
"Lender Secured Creditors" shall have the meaning provided in the
recitals of this Agreement.
"Lenders" shall have the meaning provided in the recitals of this
Agreement.
"Letter-of-Credit Rights" shall mean "letter-of-credit rights" as
such term is defined in the Uniform Commercial Code as in effect on the date
hereof in the State of New York.
"Liens" shall mean any security interest, mortgage, pledge, lien,
claim, charge, encumbrance, title retention agreement, lessor's interest in a
financing lease or analogous instrument, in, of, or on an Assignor's property.
"Location" of any Assignor, shall mean such Assignor's "location" as
determined pursuant to Section 9-307 of the UCC.
"Marks" shall mean all right, title and interest in and to any
United States or foreign trademarks, service marks and trade names now held or
hereafter acquired by any Assignor, including any registration or application
for registration of any trademarks and service marks now held or hereafter
acquired by an Assignor, which are registered in the United States Patent and
Trademark Office or the equivalent thereof in any State of the United States or
in any
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foreign country, as well as any unregistered marks used by any Assignor, and any
trade dress including logos, designs, company names, business names, fictitious
business names and other business identifiers used by any Assignor in the United
States or any foreign country.
"Non-U.S. Deposit Account" has the meaning provided in Section
3.9(a).
"Noticed Event of Default" shall mean (i) an Event of Default with
respect to a Credit Party under Section 9.05 of the Credit Agreement and (ii)
any other Event of Default in respect of which the Collateral Agent has given
either Credit Agreement Party notice that such Event of Default constitutes a
"Noticed Event of Default."
"Notified Non-Credit Agreement Event of Default" means (i) the
acceleration of the maturity of any Existing Senior Notes or Refinancing Senior
Notes or the failure to pay at maturity any Existing Senior Notes or Refinancing
Senior Notes, or the occurrence of any bankruptcy or insolvency Event of Default
under the Existing Senior Notes Indenture or the Refinancing Senior Notes
Indenture, (ii) any Event of Default under a Secured Credit Card Agreement or
(iii) any Event of Default under a Secured Hedging Agreement, in the case of any
event described in clause (i), (ii) or (iii) to the extent the Existing Senior
Notes Trustee, the Refinancing Senior Notes Trustee, the relevant Credit Card
Issuer or the relevant Hedging Creditor, as the case may be, has given written
notice to the Collateral Agent that a "Notified Non-Credit Agreement Event of
Default" exists; provided that such written notice may only be given if such
Event of Default is continuing and, provided further, that any such Notified
Non-Credit Agreement Event of Default shall cease to exist (I) once there is no
longer any Event of Default under the Existing Senior Notes Indenture, the
Refinancing Senior Notes Indenture, the respective Secured Credit Card Agreement
or the respective Secured Hedging Agreement, as the case may be, in existence,
(II) in the case of an Event of Default under the Existing Senior Notes
Indenture or the Refinancing Senior Notes Indenture, after all Existing Senior
Notes Obligations or Refinancing Senior Notes Obligations, as the case may be,
have been repaid in full, (III) in the case of an Event of Default under a
Secured Credit Card Agreement or Secured Hedging Agreement, such Secured Credit
Card Agreement or Secured Hedging Agreement, as the case may be, has been
terminated and all Credit Card Obligations or Hedging Obligations, as the case
may be, thereunder have been repaid in full, (IV) in the case of an Event of
Default under the Existing Senior Notes Indenture or the Refinancing Senior
Notes Indenture, if the Existing Senior Notes Creditors or the Refinancing
Senior Notes Creditors, as the case may be, holding at least a majority of the
aggregate principal amount of the outstanding new Senior Notes or the
Refinancing Senior Notes, as the case may be, at such time have rescinded such
written notice and (V) in the case of an Event of Default under a Secured Credit
Card Agreement or Secured Hedging Agreement, the requisite Credit Card Issuers
with Credit Card Obligations or Hedging Creditors with Hedging Obligations, as
the case may be, thereunder at such time have rescinded such written notice.
"Obligations" shall mean (i) the full and prompt payment when due
(whether at stated maturity, by acceleration or otherwise) of all obligations
(including obligations which, but for the automatic stay under Section 362(a) of
the Bankruptcy Code, would become due) and liabilities of each Assignor, now
existing or hereafter incurred under, arising out of or in connection with each
Credit Document to which it is a party (including, without limitation,
indemnities, fees and interest (including all interest that accrues after the
commencement of any
Exhibit I
Page 31
case, proceeding or other action relating to the bankruptcy, insolvency,
reorganization or similar proceeding of the Borrower or any other Credit Party
at the rate provided for in the respective documentation, whether or not a claim
for post-petition interest is allowed in any such proceeding)) and the due
performance and compliance by such Assignor with the terms of each such Credit
Document (all such obligations and liabilities under this clause (i), except to
the extent consisting of obligations or indebtedness with respect to Secured
Hedging Agreements, being herein collectively called the "Credit Document
Obligations"); (ii) the full and prompt payment when due (whether at the stated
maturity, by acceleration or otherwise) of all obligations (including
obligations which, but for the automatic stay under Section 362(a) of the
Bankruptcy Code, would become due) and liabilities of each Assignor, now
existing or hereafter incurred under, arising out of or in connection with each
Secured Credit Card Agreement, including all obligations, if any, under a
Guaranty in respect of any Secured Credit Card Agreement and all interest that
accrues after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency, reorganization or similar proceeding of the
Borrower or any other Credit Party at the rate provided for in the respective
documentation, whether or not a claim for post-petition interest is allowed in
any such proceeding (all such obligations and indebtedness under this clause
(ii) being herein collectively called the "Credit Card Obligations"); (iii) the
full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of all obligations (including obligations which, but
for the automatic stay under Section 362(a) of the Bankruptcy Code, would become
due) and liabilities of each Assignor, now existing or hereafter incurred under,
arising out of or in connection with each Secured Hedging Agreement, including
all obligations, if any, under a Guaranty in respect of any Secured Hedging
Agreement and all interest that accrues after the commencement of any case,
proceeding or other action relating to the bankruptcy, insolvency,
reorganization or similar proceeding of the Borrower or any other Credit Party
at the rate provided for in the respective documentation, whether or not a claim
for post-petition interest is allowed in any such proceeding (all such
obligations and indebtedness under this clause (iii) being herein collectively
called the "Hedging Obligations"); (iv) the full and prompt payment when due
(whether at stated maturity, by acceleration or otherwise) of all obligations
(including obligations which, but for the automatic stay under Section 362(a) of
the Bankruptcy Code, would become due) and liabilities of each Assignor, now
existing or hereafter incurred under, arising out of or in connection with each
Existing Senior Notes Document to which it is a party (including all interest
that accrues after the commencement of any case, proceeding or other action
relating to the bankruptcy, insolvency, reorganization or similar proceeding of
the Borrower or any other Credit Party at the rate provided for in the
respective documentation, whether or not a claim for post-petition interest is
allowed in any such proceeding) and the due performance and compliance by such
Assignor with the terms of each such Existing Senior Notes Document (all such
obligations and liabilities under this clause (iv), being herein collectively
called the "Existing Senior Notes Obligations"); (v) the full and prompt payment
when due (whether at stated maturity, by acceleration or otherwise) of all
obligations (including obligations which, but for the automatic stay under
Section 362(a) of the Bankruptcy Code, would become due) and liabilities of each
Assignor, now existing or hereafter incurred under, arising out of or in
connection with each Refinancing Senior Notes Document to which it is a party
(including all interest that accrues after the commencement of any case,
proceeding or other action relating to the bankruptcy, insolvency,
reorganization or similar proceeding of the Borrower or any other Credit Party
at the rate provided for in the respective documentation, whether or not a claim
for post-petition
Exhibit I
Page 32
interest is allowed in any such proceeding) and the due performance and
compliance by such Assignor with the terms of each such Refinancing Senior Notes
Document (all such obligations and liabilities under this clause (v), being
herein collectively called the "Refinancing Senior Notes Obligations"); (vi) any
and all sums advanced by the Collateral Agent or Pledgee in order to preserve
the Collateral or preserve its security interest in the Collateral; (vii) in the
event of any proceeding for the collection or enforcement of any indebtedness,
obligations, or liabilities of each Assignor referred to in clauses (i), (ii),
(iii), (iv), (v) and (vi), after an Event of Default shall have occurred and be
continuing, the reasonable expenses of re-taking, holding, preparing for sale or
lease, selling or otherwise disposing of or realizing on the Collateral, or of
any exercise by the Collateral Agent or Pledgee of its rights hereunder,
together with reasonable attorneys' fees and court costs; and (viii) all amounts
paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement under Section 8.1 hereof.
"Patents" shall mean any United States or foreign patent with
respect to which any Assignor now or hereafter has any right, title or interest,
and any divisions, continuations (including, but not limited to,
continuations-in-parts) and improvements thereof, as well as any application for
a United States or foreign patent now or hereafter made by any Assignor.
"Parent" shall have the meaning provided in the recitals to this
Agreement.
"Perfected Deposit Account" shall mean, as to any Assignor, each
Deposit Account of such Assignor other than an Excluded Deposit Account.
"Permits" shall mean, to the extent permitted to be assigned by the
terms thereof or by applicable law, all licenses, permits, rights, orders,
variances, franchises or authorizations (including certificates of need) of or
from any governmental authority or agency.
"Permitted Lien" shall mean the Liens permitted to be outstanding
under Section 8.03 of the Credit Agreement as in effect on the date hereof.
"Principal Property" shall have the meaning provided in the Existing
Senior Notes Indenture or the Refinancing Senior Notes Indenture (in each case
as in effect on the date hereof), as the context may require.
"Proceeds" shall have the meaning assigned that term under the
Uniform Commercial Code as in effect in the State of New York on the date hereof
or under other relevant law and, in any event, shall include, but not be limited
to, (i) any and all proceeds of any insurance, indemnity, warranty or guaranty
payable to the Collateral Agent or an Assignor from time to time with respect to
any of the Collateral, (ii) any and all payments (in any form whatsoever) made
or due and payable to an Assignor from time to time in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of all or any
part of the Collateral by any governmental authority (or any person acting under
color of governmental authority) and (iii) any and all other amounts from time
to time paid or payable under or in connection with any of the Collateral.
"Pro Rata Share" shall have the meaning provided in Section 7.4(b)
of this Agreement.
Exhibit I
Page 33
"Receivable" shall mean any "account" as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York, and in any event shall include but shall not be limited to, all rights to
payment of any monetary obligation, whether or not earned by performance, (i)
for property that has been or is to be sold, leased, licensed, assigned or
otherwise disposed of, (ii) for services rendered or to be rendered, (iii) for a
policy of insurance issued or to be issued, (iv) for a secondary obligation
incurred or to be incurred, (v) for energy provided or to be provided, (vi) for
the use or hire of a vessel under a charter or other contract, (vii) arising out
of the use of a credit or charge card or information contained on or for use
with the card, or (viii) as winnings in a lottery or other game of chance
operated or sponsored by a State, governmental unit of a State, or person
licensed or authorized to operate the game by a State or governmental unit of a
State. Without limiting the foregoing, the term "account" shall include all
Health-Care-Insurance Receivables.
"Refinancing Senior Notes Creditors" shall have the meaning provided
in the recitals of this Agreement.
"Refinancing Senior Notes Documents" shall have the meaning provided
in the recitals of this Agreement.
"Refinancing Senior Notes Indenture" shall have the meaning provided
in the recitals of this Agreement.
"Refinancing Senior Notes Obligations" shall have the meaning
provided in the definition of "Obligations" in this Article IX.
"Refinancing Senior Notes Trustee" shall have the meaning provided
in the recitals of this Agreement.
"Registered Organization" shall have the meaning provided in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York.
"Requisite Creditors" shall have the meaning provided in Section
10.2 hereof.
"Restricted Subsidiary" shall mean each Subsidiary that is a
Restricted Subsidiary, as such term is defined in the Existing Senior Notes
Indenture or the Refinancing Senior Notes Indenture (each, as in effect on the
date hereof), as the context may require.
"Secured Credit Card Agreement" shall have the meaning provided in
the recitals of this Agreement.
"Secured Creditors" shall have the meaning provided in the recitals
of this Agreement.
"Secured Debt Agreements" shall mean each Credit Document, each
Secured Credit Card Agreement, each Secured Hedging Agreement, each Existing
Senior Notes Document and each Refinancing Senior Notes Document.
Exhibit I
Page 34
"Secured Hedging Agreements" shall have the meaning provided in the
recitals of this Agreement.
"Security" shall mean "security" as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York.
"Software" shall mean "software" as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York.
"Specified Assignor" shall mean each of Parent, the Borrower and
each Assignor that is a Restricted Subsidiary.
"Supporting Obligations" shall mean any "supporting obligation" as
such term is defined in the Uniform Commercial Code as in effect on the date
hereof in the State of New York, now or hereafter owned by any Assignor, or in
which any Assignor has any rights, and, in any event, shall include, but shall
not be limited to all of such Assignor's rights in any Letter-of-Credit Right or
secondary obligation that supports the payment or performance of, and all
security for, any Receivable, Chattel Paper, Document, General Intangible,
Instrument or Investment Property.
"Tangible Chattel Paper" shall mean "tangible chattel paper" as such
term is defined in the Uniform Commercial Code as in effect on the date hereof
in the State of New York.
"Termination Date" shall have the meaning provided in Section 10.9
hereof.
"Timber-to-be-Cut" shall mean "timber-to-be-cut" as such term is
used in the Uniform Commercial Code as in effect on the date hereof in the State
of New York.
"Trade Secret Rights" shall mean the rights of an Assignor in any
Trade Secret it holds.
"Trade Secrets" means any secretly held existing engineering and
other data, information, production procedures and other know-how relating to
the design, manufacture, assembly, installation, use, operation, marketing, sale
and servicing of any products or business of an Assignor worldwide whether
written or not written.
ARTICLE X
MISCELLANEOUS
10.1 Notices. All notices and other communications provided for
hereunder shall be in writing (including telegraphic, telex, facsimile
transmission or cable communication) and mailed, telegraphed, telexed,
telecopied, cabled or delivered (including by way of overnight courier):
Exhibit I
Page 35
(i) if to any Assignor, at its address contained in the Credit
Agreement (for the Credit Agreement Parties) or the Subsidiary Guaranty
(for the other Assignors);
(ii) if to the Collateral Agent, at:
JPMorgan Chase Bank
270 Park Avenue
New York, New York 10017
Attn.: Raju Nanoo
Tel. No.: 212-270-2272
Fax. No.: 212-270-5120
(iii) if to any Lender (other than the Collateral Agent), at such
address as such Lender shall have specified in the Credit Agreement;
(iv) if to any Credit Card Issuer, at such address as such Credit
Card Issuer shall have specified in writing to the Assignors and the
Collateral Agent;
(v) if to any Hedging Creditor, at such address as such Hedging
Creditor shall have specified in writing to the Assignors and the
Collateral Agent;
(vi) if to any Existing Senior Notes Creditor, at such address of
the Existing Senior Notes Trustee as the Existing Senior Notes Trustee
shall have specified in writing to the Assignors and the Collateral Agent;
(vii) if to any Refinancing Senior Notes Creditor, at such address
of the Refinancing Senior Notes Trustee as the Refinancing Senior Notes
Trustee shall have specified in writing to the Assignors and the
Collateral Agent;
or at such other address as shall have been furnished in writing by any Person
described above to the party required to give notice hereunder. Except as
otherwise expressly provided herein, all such notices and communications shall
be deemed to have been duly given or made when received.
10.2 Waiver; Amendment. (a) None of the terms and conditions of this
Agreement may be changed, waived, modified or varied in any manner whatsoever
unless in writing duly signed by the Collateral Agent (with the consent of (x)
if prior to the CA Termination Date, the Required Lenders or, to the extent
required by Section 12.12 of the Credit Agreement, all of the Lenders and (y) if
on or after the CA Termination Date, the holders of a majority of the
outstanding principal amount of the Obligations remaining outstanding) and each
Assignor affected thereby (it being understood that the addition or release of
any Assignor hereunder shall not constitute a change, waiver, modification or
variance affecting any Assignor other than the Borrower and the Assignor so
added or released), provided that any change, waiver, modification or variance
affecting the rights and benefits of a single Class of Secured Creditors (and
not all Secured Creditors in a like or similar manner) shall require the written
consent of the Requisite Creditors of such Class of Secured Creditors. For the
purpose of this Agreement, the term "Class" shall mean each class of Secured
Creditors, i.e., whether (u) the Lender Creditors as holders of the Credit
Document Obligations, (v) the Credit Card Issuers as
Exhibit I
Page 36
holders of the Credit Card Obligations, (x) the Hedging Creditors as holders of
the Hedging Obligations, (y) the Existing Senior Notes Creditors as holders of
the Existing Senior Notes Obligations or (z) the Refinancing Senior Notes
Creditors as holders of the Refinancing Senior Notes Obligations. For the
purpose of this Agreement, the term "Requisite Creditors" of any Class shall
mean each of (u) with respect to each of the Credit Document Obligations, the
Required Lenders, (v) with respect to the Credit Card Obligations, the holders
of at least a majority of all Credit Card Obligations outstanding from time to
time, (x) with respect to the Hedging Obligations, the holders of at least a
majority of all Hedging Obligations outstanding from time to time, (y) with
respect to the Existing Senior Notes Obligations, the holders of at least a
majority of the outstanding principal amount of the Existing Senior Notes, and
(z) with respect to the Refinancing Senior Notes Obligations, the holders of at
least a majority of the outstanding principal amount of the Refinancing Senior
Notes.
(a) No delay on the part of the Collateral Agent in exercising any
of its rights, remedies, powers and privileges hereunder or partial or single
exercise thereof, shall constitute a waiver thereof. No notice to or demand on
any Assignor shall constitute a waiver of any of the rights of the Collateral
Agent to any other or further action without notice or demand to the extent such
action is permitted to be taken by the Collateral Agent without notice or demand
under the terms of this Agreement.
10.3 Obligations Absolute. The obligations of each Assignor
hereunder shall remain in full force and effect without regard to, and shall not
be impaired by, (a) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of any Assignor; (b) any
exercise or non-exercise, or any waiver of, any right, remedy, power or
privilege under or in respect of this Agreement, any other Credit Document, any
Secured Credit Card Agreement, any Secured Hedging Agreement, any Existing
Senior Notes Document or any Refinancing Senior Notes Document, except as
specifically set forth in a waiver granted pursuant to Section 10.2 hereof; or
(c) any amendment to or modification of any other Credit Document, any Secured
Credit Card Agreement, any Secured Hedging Agreement, any Existing Senior Notes
Document, any Refinancing Senior Notes Document or any security for any of the
Obligations; whether or not any Assignor shall have notice or knowledge of any
of the foregoing. The rights and remedies of the Collateral Agent herein
provided are cumulative and not exclusive of any rights or remedies which the
Collateral Agent would otherwise have.
10.4 Successors and Assigns. This Agreement shall be binding upon
each Assignor and its successors and assigns and shall inure to the benefit of
the Collateral Agent and its successors and assigns. All agreements, statements,
representations and warranties made by such Assignor herein or in any
certificate or other instrument delivered by each Assignor or on its behalf
under this Agreement shall be considered to have been relied upon by the Secured
Creditors and shall survive the execution and delivery of this Agreement, the
other Credit Documents, the Secured Credit Card Agreements, the Secured Hedging
Agreements, the Existing Senior Notes Documents and the Refinancing Senior Notes
Documents, regardless of any investigation made by the Secured Creditors on
their behalf.
10.5 Headings Descriptive. The headings of the several sections of
this Agreement are inserted for convenience only and shall not in any way affect
the meaning or construction of any provision of this Agreement.
Exhibit I
Page 37
10.6 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.7 Governing Law. This Agreement and the rights and obligations of
the parties hereunder shall be construed in accordance with and governed by the
law of the State of New York.
10.8 Assignors' Duties. It is expressly agreed, anything herein
contained to the contrary notwithstanding, that each Assignor shall remain
liable to perform all of the obligations, if any, assumed by it with respect to
the Collateral and the Collateral Agent shall not have any obligations or
liabilities with respect to any Collateral by reason of or arising out of this
Agreement, nor shall the Collateral Agent be required or obligated in any manner
to perform or fulfill any of the obligations of any Assignor under or with
respect to any Collateral.
10.9 Termination; Release. (a) After the Termination Date (as
defined below), this Agreement shall terminate (provided that all indemnities
set forth herein including, without limitation, in Article VIII hereof shall
survive any such termination) and the Collateral Agent, at the request and
expense of the respective Assignor, will execute and deliver to such Assignor a
proper instrument or instruments acknowledging the satisfaction and termination
of this Agreement as provided above, and will duly assign, transfer and deliver
to such Assignor (without recourse and without any representation or warranty)
such of the Collateral as may be in the possession of the Collateral Agent and
as has not theretofore been sold or otherwise applied or released pursuant to
this Agreement, together with any moneys at the time held by the Collateral
Agent hereunder. As used in this Agreement, (i) "CA Termination Date" shall mean
the date upon which the Total Commitment has been terminated, no Letter of
Credit or Note under the Credit Agreement is outstanding and all other Credit
Document Obligations have been paid in full in cash (other than arising from
indemnities for which no request for payment has been made) and (ii)
"Termination Date" shall mean the date upon which (x) the CA Termination Date
shall have occurred and (y) if (but only if) a Notified Non-Credit Agreement
Event of Default shall have occurred and be continuing on the CA Termination
Date (and after giving effect thereto), either (I) such Notified Non-Credit
Agreement Event of Default shall have been cured or waived by the requisite
holders of the relevant Obligations subject to such Notified Non-Credit
Agreement Event of Default or (II) all Secured Credit Card Agreements and
Secured Hedging Agreements (if any) giving rise to a Notified Non-Credit
Agreement Event of Default shall have been terminated and all Obligations
subject to such Notified Non-Credit Agreement Event of Default shall have been
paid in full (other than arising from indemnities for which no request for
payment has been made).
(b) So long as no Notified Non-Credit Agreement Event of Default has
occurred and is continuing, in the event that (x) prior to the CA Termination
Date, (i) any part of the Collateral is sold or otherwise disposed of in
connection with a sale or other disposition permitted by Section 8.02 of the
Credit Agreement (it being agreed for such purposes that a release will be
deemed "permitted by Section 8.02 of the Credit Agreement" if the proposed
transaction constitutes an exception to Section 8.02 of the Credit Agreement) or
(ii) all or any
Exhibit I
Page 38
part of the Collateral is released at the direction of the Required Lenders (or
all the Lenders if required by Section 12.12 of the Credit Agreement), and the
proceeds of such sale or disposition or from such release (if any) are applied
in accordance with the terms of the Credit Agreement to the extent required to
be so applied or (y) on and after the CA Termination Date, any part of the
Collateral is sold or otherwise disposed of without violating the Existing
Senior Notes Documents, the Refinancing Senior Notes Documents, the Secured
Credit Card Agreements and the Secured Hedging Agreements, the Collateral Agent,
at the request and expense of the respective Assignor will release such
Collateral from this Agreement, duly assign, transfer and deliver to such
Assignor (without recourse and without any representation or warranty) such of
the Collateral as is then being (or has been) so sold or released and as may be
in possession of the Collateral Agent and has not theretofore been released
pursuant to this Agreement (it being understood and agreed that upon the release
of all or any portion of the Collateral by the Collateral Agent at the direction
of the Lenders as provided above, the Lien on the Collateral in favor of the
Credit Card Issuer, the Hedging Creditors, the Existing Senior Notes Creditors
and the Refinancing Senior Notes Creditors shall automatically be released).
(b) In addition to the foregoing, all Collateral shall be
automatically released (subject to reinstatement upon the occurrence of a new
Trigger Event) in accordance with the provisions of the last sentence of Section
7.10(b) of the Credit Agreement.
(c) At any time that the relevant Assignor desires that the
Collateral Agent take any action to give effect to any release of Collateral
pursuant to the foregoing Section 10.9(a), (b) or (c), it shall deliver to the
Collateral Agent a certificate signed by an authorized officer describing the
Collateral to be released and certifying its entitlement to a release pursuant
to the applicable provisions of Sections 10.9(a), (b) or (c) and in such case
the Collateral Agent, at the request and expense of such Assignor, will execute
such documents as required to duly release such Collateral and to assign,
transfer and deliver to such Assignor or its designee (without recourse and
without any representation or warranty) such of the Collateral as is then being
released and as may be in the possession of the Collateral Agent. The Collateral
Agent shall have no liability whatsoever to any Secured Creditor as the result
of any release of Collateral by it as permitted by (or which the Collateral
Agent in good faith believes to be permitted by) this Section 10.9. Upon any
release of Collateral pursuant to Section 10.9(a), (b) or (c), so long as no
Noticed Event of Default is then in existence, none of the Secured Creditors
shall have any continuing right or interest in such Collateral, or the proceeds
thereof (subject to reinstatement rights upon the occurrence of a new Trigger
Event in the case of a release pursuant to Section 10.9(c)).
10.10 Collateral Agent. The Collateral Agent will hold in accordance
with this Agreement all items of the Collateral at any time received under this
Agreement. By accepting the benefits of this Agreement, each Secured Creditor
acknowledges and agrees that the obligations of the Collateral Agent as holder
of the Collateral and interests therein and with respect to the disposition
thereof, and otherwise under this Agreement, are only those expressly set forth
in this Agreement and Annex M hereto. The Collateral Agent shall act hereunder
on the terms and conditions set forth in Section 11 of the Credit Agreement and
in Annex M hereto, the terms of which shall be deemed incorporated herein by
reference as fully as if the same were set forth herein in their entirety. In
the event that any provision set forth in Section 11 of the Credit Agreement in
respect of the Collateral Agent conflicts with any provision set forth in Annex
M
Exhibit I
Page 39
hereto, the provisions of Annex M hereto shall govern (except that the Lenders
shall remain obligated to indemnify the Collateral Agent pursuant to Section 11
of the Credit Agreement, to the extent the Collateral Agent is not indemnified
by Secured Creditors pursuant to Annex M). Notwithstanding anything to the
contrary contained in Section 10.2 of this Agreement, this Section 10.10, and
the duties and obligations of the Collateral Agent set forth in this Section
10.10, may not be amended or modified without the consent of the Collateral
Agent.
10.11 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Collateral Agent.
10.12 Additional Assignors. It is understood and agreed that any
Subsidiary of Parent that is required to become a party to this Agreement after
the date hereof pursuant to the requirements of the Credit Agreement shall
become an Assignor hereunder by (x) executing a counterpart hereof and/or an
assumption agreement in form and substance satisfactory to the Collateral Agent,
(y) delivering supplements to Annexes A through F hereto and Annexes I, J and K
hereto, as are necessary to cause such Annexes to be complete and accurate with
respect to such additional Assignor on such date and (z) taking all actions as
specified in this Agreement and the Credit Agreement, in each case with all
documents required above to be delivered to the Collateral Agent and with all
documents and action required above to be taken to the reasonable satisfaction
of the Collateral Agent.
10.13 No Third Party Beneficiaries. This Agreement is entered into
solely for the benefit of the parties hereto and their respective successors and
assigns and for the benefit of the Secured Creditors from time to time and their
respective successors and assigns and, except for the Secured Creditors and
their successors and assigns, there shall be no third party beneficiaries
hereof, nor shall any Person other than the parties hereto and their respective
successors and assigns, and the Secured Creditors and their respective
successors and assigns, be entitled to enforce the provisions hereof or have any
claims against any party hereto (or any Secured Creditor) or their successors
and assigns arising from, or under, this Agreement.
* * *
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed and delivered by their duly authorized officers as of the date first
above written.
REYNOLDS AMERICAN INC., as an
Assignor
By: /s/ Lynn L. Lane
----------------------------------------
Title: Senior Vice President & Treasurer
R.J. REYNOLDS TOBACCO HOLDINGS,
INC., as an Assignor
By: /s/ Lynn L. Lane
----------------------------------------
Title: Senior Vice President & Treasurer
R. J. REYNOLDS TOBACCO COMPANY,
as an Assignor
By: /s/ Lynn L. Lane
----------------------------------------
Title: Senior Vice President & Treasurer
RJR ACQUISITION CORP., as an Assignor
By: /s/ Lynn L. Lane
----------------------------------------
Title: Vice President & Treasurer
GMB, INC., as an Assignor
By: /s/ Daniel A. Fawley
----------------------------------------
Title: Treasurer
FHS, INC., as an Assignor
By: /s/ Caroline M. Price
----------------------------------------
Title: President
R. J. REYNOLDS TOBACCO CO., as an Assignor
By: /s/ Lynn L. Lane
----------------------------------------
Title: Treasurer
RJR PACKAGING, LLC, as an Assignor
By: /s/ Lynn L. Lane
---------------------------------------
Title: Treasurer
BWT BRANDS, INC., as an Assignor
By: /s/ Daniel A. Fawley
----------------------------------------
Title: Treasurer
Acknowledged And Agreed:
JPMORGAN CHASE BANK,
as Collateral Agent and Assignee
By /s/ Robert T. Sacks
----------------------------------
Title: Managing Director