Exhibit 4.35
PLEDGE AND SECURITY AGREEMENT
Dated as of July 9, 2004
among
REVLON, INC.,
REVLON CONSUMER PRODUCTS CORPORATION
and
Each Other Grantor
From Time to Time Party Hereto
and
CITICORP USA, INC.
as Collateral Agent
WEIL, GOTSHAL & MANGES LLP
767 FIFTH AVENUE
NEW YORK, NEW YORK 10153-0119
THIS PLEDGE AND SECURITY AGREEMENT IS SUBJECT TO THE TERMS AND PROVISIONS OF
THE INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT, DATED AS OF JULY 9, 2004
(AS SUCH AGREEMENT MAY BE AMENDED, AMENDED AND RESTATED, SUPPLEMENTED OR
OTHERWISE MODIFIED FROM TIME, THE "INTERCREDITOR AGREEMENT"), AMONG CITICORP
USA, INC., AS ADMINISTRATIVE AGENT FOR THE MULTI-CURRENCY LENDERS AND ISSUING
LENDERS, CITICORP USA, INC., AS ADMINISTRATIVE AGENT FOR THE TERM LOAN
LENDERS, CITICORP USA, INC., AS COLLATERAL AGENT FOR THE SECURED PARTIES,
REVLON, INC., REVLON CONSUMER PRODUCTS CORPORATION AND EACH OTHER GRANTOR.
PLEDGE AND SECURITY AGREEMENT, dated as of July 9, 2004, by Revlon,
Inc. ("Revlon"), Revlon Consumer Products Corporation (the "Company") and each
of the other entities listed on the signature pages hereof or that becomes a
party hereto pursuant to Section 7.10 (Additional Grantors) (together with the
Revlon and the Company, each a "Grantor" and collectively, the "Grantors") in
favor of Citicorp USA, Inc. ("Citicorp"), as collateral agent for the Secured
Parties (in such capacity, the "Collateral Agent"). All capitalized terms used
herein and not otherwise defined herein shall have the respective meanings
given such terms in the Credit Agreement referred to below.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, dated as of July
9, 2004 (as the same may be amended, restated, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among the Company,
certain of its subsidiaries, as Local Borrowing Subsidiaries, the Lenders and
Issuing Lenders party thereto and Citicorp, as administrative agent for the
Multi-Currency Lenders and Issuing Lenders ("Multi-Currency Administrative
Agent"), Citicorp, as administrative agent for the Term Loan Lenders ("Term
Loan Administrative Agent" and together with the Multi-Currency Administrative
Agent, the "Administrative Agents"), and Citicorp, as the Collateral Agent
(together with the Administrative Agents, the "Agents"), the Lenders and the
Issuing Lenders have severally agreed to make extensions of credit to the
Borrowers upon the terms and subject to the conditions set forth therein;
WHEREAS, the Grantors are party to the Guaranty pursuant to
which they have guaranteed the Payment Obligations (as defined in the Credit
Agreement); and
WHEREAS, it is a condition precedent to the obligation of
the Lenders and the Issuing Lenders to make their respective extensions of
credit to the Borrowers under the Credit Agreement that the Grantors shall
have executed and delivered this Agreement to the Collateral Agent;
NOW, THEREFORE, in consideration of the premises and to
induce the Lenders, the Issuing Lenders and the Collateral Agent to enter into
the Credit Agreement and to induce the Lenders and the Issuing Lenders to make
their respective extensions of credit to the Borrowers thereunder, each
Grantor hereby agrees with the Collateral Agent as follows:
Article I DEFINED TERMS
Section 1.1 Definitions
(a) Unless otherwise defined herein, terms defined in the
Credit Agreement and used herein have the meanings given to them in the Credit
Agreement.
(b) Terms used herein without definition that are defined in
the UCC have the meanings given to them in the UCC, including the following
terms (which are capitalized herein):
"Account Debtor"
"Account"
"Certificated Security"
"Chattel Paper"
"Commercial Tort Claim"
"Commodity Account"
"Control Account"
"Deposit Account"
"Documents"
"Entitlement Holder"
"Entitlement Order"
"Equipment"
"Financial Asset"
"Fixtures"
"General Intangible"
"Goods"
"Instruments"
"Inventory"
"Investment Property"
"Lease"
"Letter-of-Credit Right"
"Payment Intangibles"
"Proceeds"
"Securities Account"
"Securities Intermediary"
"Security"
"Security Entitlement"
"Software"
"Supporting Obligations"
(c) The following terms shall have the following meanings:
"Additional Pledged Collateral" means any Pledged Collateral
acquired by any Grantor after the date hereof and in which a security interest
is granted pursuant to Section 2.2 (Grants of Security Interest in
Collateral), including, to the extent a security interest is granted therein
pursuant to, Section 2.2 (Grants of Security Interest in Collateral) (i) all
Stock and Stock Equivalents of any Person that are acquired by any Grantor
after the date hereof, together with all certificates, instruments or other
documents representing any of the foregoing and all Security Entitlements of
any Grantor in respect of any of the foregoing, (ii) all additional
Indebtedness from time to time owed to any Grantor by any obligor on the
Pledged Debt Instruments and the Instruments evidencing such Indebtedness and
(iii) all interest, cash, Instruments and other property or Proceeds from time
to time received, receivable or otherwise distributed in respect of or in
exchange for any of the foregoing. "Additional Pledged Collateral" may be
General Intangibles, Instruments or Investment Property.
"Agreement" means this Pledge and Security Agreement.
"Collateral" means, collectively, the Multi-Currency
Collateral and the Term Loan Collateral.
"Constituent Documents" means, with respect to any Person,
(a) the articles of incorporation, certificate of incorporation or certificate
of formation (or the equivalent organizational documents) of such Person, (b)
the by-laws, operating agreement (or the equivalent governing documents) of
such Person and (c) any document setting forth the manner of election and
duties of the directors or managing members of such Person (if any) and the
designation, amount or relative rights, limitations and preferences of any
class or series of such Person's Stock.
"Copyright Licenses" means any written agreement naming any
Grantor as licensor or licensee granting any right under any Copyright,
including the grant of any right to copy, publicly perform, create derivative
works, manufacture, distribute, exploit or sell materials derived from any
Copyright.
"Copyrights" means (a) all copyrights arising under the laws
of the United States, any other country or any political subdivision thereof,
whether registered or unregistered and whether published or unpublished, all
registrations and recordings thereof and all applications in connection
therewith, including all registrations, recordings and applications in the
United States Copyright Office or in any foreign counterparts thereof, and (b)
the right to obtain all renewals thereof.
"Deposit Account Control Agreement" means a letter
agreement, substantially in the form of Annex 1 (Form of Deposit Account
Control Agreement) (with such changes as may be agreed to by the
Multi-Currency Administrative Agent), executed by the Grantor, the Collateral
Agent and the relevant financial institution, or otherwise in form and
substance reasonably satisfactory to the Multi-Currency Administrative Agent.
"Domestic Person" means any "United States person" under and
as defined in Section 7701(a)(30) of the Code.
"Excluded Equity" means any Voting Stock in excess of 66% of
the total outstanding Voting Stock of any direct Subsidiary of any Grantor if
such Subsidiary is a Non-U.S. Person. For the purposes of this definition,
"Voting Stock" means, as to any issuer, the issued and outstanding shares of
each class of capital stock or other ownership interests of such issuer
entitled to vote (within the meaning of Treasury Regulations ss.
1.956-2(c)(2)).
"Excluded Property" means, collectively, (i) Excluded
Equity, (ii) any permit, lease, license, contract, instrument or other
agreement held by any Grantor that prohibits or requires the consent of any
Person other than the Company and its Affiliates as a condition to the
creation by such Grantor of a Lien thereon, or any permit, lease, license,
contract, instrument or other agreement held by any Grantor to the extent that
any Requirement of Law applicable thereto prohibits the creation of a Lien
thereon, but only, in each case, to the extent, and for so long as, such
prohibition is not terminated or rendered unenforceable or otherwise deemed
ineffective by the UCC or any other Requirement of Law, (iii) Equipment or
Fixtures owned by any Grantor that is subject to a purchase money Lien or a
capital lease if the contract or other agreement in which such Lien is granted
(or in the documentation providing for such capital lease) prohibits or
requires the consent of any Person other than the Company and its Affiliates
as a condition to the creation of any other Lien on such Equipment or
Fixtures, (iv) an application to register a trademark under Section 1(b) of
the Trademark Act, 15 U.S.C. Section 1051(b), prior to the filing of an
amendment under Section 1(c) or statement of use under Section 1(d), 15 U.S.C.
Sections 1051(c) or (d) and (v) any property or asset of any Loan Party
situated (or deemed to be situated) in the Commonwealth of Australia;
provided, however, "Excluded Property" shall not include any Proceeds,
substitutions or replacements of Excluded Property (unless such Proceeds,
substitutions or replacements would constitute Excluded Property).
"Excluded Trademarks" means the Trademarks listed on
Schedule 8 (Excluded Trademarks).
"First Priority Multi-Currency Collateral Liens" has the
meaning specified in Section 2.2(a).
"First Priority Term Loan Collateral Liens" has the meaning
specified in Section 2.2(c).
"Intellectual Property" means, collectively, all rights,
priorities and privileges of any Grantor relating to intellectual property,
whether arising under United States, multinational or foreign laws or
otherwise, including Copyrights, Copyright Licenses, Patents, Patent Licenses,
Trademarks, Trademark Licenses, trade secrets and Internet domain names, and
all rights to sue at law or in equity for any infringement or other impairment
thereof, including the right to receive all proceeds and damages therefrom.
"Intercompany Note" means any promissory note evidencing
loans made by any Grantor or any of its Subsidiaries to a Grantor.
"Intercreditor Agreement" has the meaning specified in the
legend to this Agreement.
"LLC" means each limited liability company in which a
Grantor has an interest, including those set forth on Schedule 2 (Pledged
Collateral), but excluding Revlon Professional Holding Company LLC.
"LLC Agreement" means each operating agreement with respect
to a LLC, as each agreement has heretofore been, and may hereafter be,
amended, restated, supplemented or otherwise modified from time to time.
"Material Intellectual Property" means, with respect to any
Grantor, at any time, Intellectual Property owned by or licensed to such
Grantor that is necessary or otherwise material to the conduct of the business
of the Company and its Subsidiaries, taken as a whole, at such time.
"Multi-Currency Administrative Agent" has the meaning
specified in the recitals hereto.
"Multi-Currency Eligible Obligations" has the meaning
specified in the Intercreditor Agreement.
"Multi-Currency Collateral" has the meaning specified in
Section 2.1(a).
"Multi-Currency Secured Obligations" means, collectively,
(a) the Payment Obligations arising under the Multi-Currency Facility, (b) the
obligations of each Loan Party related thereto under the Guaranty and the
other Loan Documents to which it is a party and (c) the Multi-Currency
Eligible Obligations.
"Multi-Currency Secured Party" means the Multi-Currency
Administrative Agent and each holder of any Multi-Currency Secured Obligation.
"Non-U.S. Person" means any Person that is not a Domestic
Person.
"pay in full," "paid in full" or "payment in full" shall
mean, with respect to the Secured Obligations, the payment in full in cash of
the principal of, accrued (but unpaid) interest and premium, if any, on all
such Secured Obligations and, with respect to letters of credit outstanding
thereunder, delivery of cash collateral or backstop letters of credit in
respect thereof in compliance with the terms thereof, in each case, after or
concurrently with termination of all Commitments thereunder and payment in
full in cash of any other Secured Obligations that are due and payable at or
prior to the time such principal and interest are paid.
"Parent Collateral" has the meaning specified in Section
2.1(c).
"Partnership" means each partnership in which a Grantor has
an interest, including those set forth on Schedule 2 (Pledged Collateral).
"Partnership Agreement" means each partnership agreement
governing a Partnership, as each such agreement has heretofore been, and may
hereafter be, amended, restated, supplemented or otherwise modified.
"Patents" means (a) all letters patent of the United States,
any other country or any political subdivision thereof and all reissues and
extensions thereof, (b) all applications for letters patent of the United
States or any other country and all divisionals, continuations and
continuations-in-part thereof and (c) all rights to obtain any reissues or
extensions of the foregoing.
"Patent License" means all agreements, whether written or
oral, providing for the grant by or to any Grantor of any right to
manufacture, have manufactured, use, import, sell or offer for sale any
invention covered in whole or in part by a Patent.
"Pledged Certificated Stock" means all Certificated
Securities and any other Stock and Stock Equivalent of a Person evidenced by a
certificate, Instrument or other equivalent document, in each case owned by
any Grantor, including all Stock listed on Schedule 2 (Pledged Collateral).
"Pledged Collateral" means, collectively, the Pledged Stock,
Pledged Debt Instruments, any other Investment Property of any Grantor, all
chattel paper, certificates or other Instruments representing any of the
foregoing and all Security Entitlements of any Grantor in respect of any of
the foregoing. Pledged Collateral may be General Intangibles, Instruments or
Investment Property, but excludes Excluded Equity.
"Pledged Debt Instruments" means all right, title and
interest of any Grantor in Instruments evidencing any Indebtedness owed to
such Grantor, including all Indebtedness described on Schedule 2 (Pledged
Collateral), issued by the obligors named therein.
"Pledged Stock" means all Pledged Certificated Stock and all
Pledged Uncertificated Stock. For purposes of this Agreement, the term
"Pledged Stock" shall not include any Excluded Equity.
"Pledged Uncertificated Stock" means any Stock or Stock
Equivalent of any Person that is not Pledged Certificated Stock, including all
right, title and interest of any Grantor as a limited or general partner in
any Partnership or as a member of any LLC and all right, title and interest of
any Grantor in, to and under any Partnership Agreement or LLC Agreement to
which it is a party.
"Second Priority Multi-Currency Collateral Liens" has the
meaning specified in Section 2.2(b).
"Second Priority Term Loan Collateral Liens" has the meaning
specified in Section 2.2(d).
"Securities Account Control Agreement" means a letter
agreement, substantially in the form of Annex 2 (Form of Securities Account
Control Agreement) (with such changes as may be agreed to by the
Multi-Currency Administrative Agent), executed by the relevant Grantor, the
Collateral Agent and the relevant Approved Securities Intermediary, or
otherwise in form and substance reasonably satisfactory to the Multi-Currency
Administrative Agent.
"Securities Act" means the Securities Act of 1933, as
amended.
"Stock" means shares of capital stock (whether denominated
as common stock or preferred stock), beneficial, partnership or membership
interests, participations or other equivalents (regardless of how designated)
of or in a corporation, partnership, limited liability company or equivalent
entity, whether voting or non-voting.
"Stock Equivalents" means all securities convertible into or
exchangeable for Stock and all warrants, options or other rights to purchase
or subscribe for any Stock, whether or not presently convertible, exchangeable
or exercisable.
"Term Loan Administrative Agent" has the meaning specified
in the recitals hereto.
"Term Loan Collateral" has the meaning specified in Section
2.1(b).
"Term Loan Secured Obligations" means all Secured
Obligations (other than the Multi-Currency Secured Obligations).
"Term Loan Secured Party" means the Term Loan Administrative
Agent and each holder of any Term Loan Secured Obligations.
"Trademark License" means any agreement, whether written or
oral, providing for the grant by or to any Grantor of any right to use any
Trademark.
"Trademarks" means (a) all trademarks, trade names,
corporate names, company names, business names, fictitious business names,
trade styles, service marks, logos and other source or business identifiers,
and, in each case, all goodwill associated therewith, whether now existing or
hereafter adopted or acquired, all registrations and recordings thereof and
all applications in connection therewith, in each case whether in the United
States Patent and Trademark Office or in any similar office or agency of the
United States, any State thereof or any other country or any political
subdivision thereof, or otherwise, and all common-law rights related thereto,
and (b) the right to obtain all renewals thereof; provided, that any reference
in the Loan Documents to "Trademarks" of the Company shall exclude the
Excluded Trademarks.
"UCC" means the Uniform Commercial Code as from time to time
in effect in the State of New York; provided, however, that, in the event
that, by reason of mandatory provisions of law, any of the attachment,
perfection or priority of the Collateral Agent's and the Secured Parties'
security interests in any Collateral is governed by the Uniform Commercial
Code as in effect in a jurisdiction other than the State of New York, the term
"UCC" shall mean the Uniform Commercial Code as in effect in such other
jurisdiction for purposes of the provisions hereof relating to such
attachment, perfection or priority and for purposes of definitions related to
such provisions.
"Vehicles" means all vehicles covered by a certificate of
title law of any state.
Section 1.2 Certain Other Terms
(a) In this Agreement, in the computation of periods of time
from a specified date to a later specified date, the word "from" means "from
and including" and the words "to" and "until" each mean "to but excluding" and
the word "through" means "to and including."
(b) The terms "herein," "hereof," "hereto" and "hereunder"
and similar terms refer to this Agreement as a whole and not to any particular
Article, Section, subsection or clause in this Agreement.
(c) References herein to an Annex, Schedule, Article,
Section, subsection or clause refer to the appropriate Annex or Schedule to,
or Article, Section, subsection or clause in this Agreement.
(d) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.
(e) Where the context requires, provisions relating to the
Collateral or any part thereof, when used in relation to a Grantor, shall
refer to such Grantor's Collateral or any relevant part thereof.
(f) Any reference in this Agreement to a Loan Document shall
include all appendices, exhibits and schedules thereto, and, unless
specifically stated otherwise all amendments, restatements, supplements or
other modifications thereto, and as the same may be in effect at any time such
reference becomes operative.
(g) The term "including" means "including without
limitation," except when used in the computation of time periods.
(h) The term "promptly" shall mean within three Business
Days unless otherwise determined in the reasonable discretion of the
Collateral Agent.
(i) The terms "Lender," "Issuing Lender," "Collateral Agent"
and "Secured Party" include their respective permitted successors and assigns.
(j) References in this Agreement to any statute shall be to
such statute as amended or modified and in effect from time to time.
Article II GRANT OF SECURITY INTEREST
Section 2.1 Collateral
(a) For the purposes of this Agreement, all of the following
property now owned or at any time hereafter acquired by a Grantor (other than
Revlon) or in which such Grantor now has or at any time in the future may
acquire any right, title or interest is collectively referred to as the
"Multi-Currency Collateral":
(i) all Accounts;
(ii) all Chattel Paper;
(iii) all Deposit Accounts;
(iv) all Equipment;
(v) all Fixtures;
(vi) all Instruments;
(vii) all Inventory;
(viii) all Investment Property (excluding any Stock or
Stock Equivalents issued by the Company or any of its Subsidiaries and any
certificates representing such Stock or Stock Equivalents);
(ix) all Letter-of-Credit Rights;
(x) all Vehicles;
(xi) all General Intangibles solely to the extent (A)
primarily related, and integral, to the development, construction,
maintenance, ownership and/or use of, or embedded in, any Real Property,
Fixtures, Equipment or Vehicles, including all licenses, permits,
certificates, Software and computer programs necessary for the use of such
property, or (B) derived or arising from, or giving rise to, any Real Property
or any other property described in this Section 2.1(a), including all Leases,
Payment Intangibles, Supporting Obligations, all know-how, warranties,
guarantees, endorsements, indemnifications and insurance policies to the
extent covering such property and all other rights and claims pertaining to
such property (but, in the case of this clause (B), excluding all Intellectual
Property);
(xii) all Documents pertaining to the other property
described in this Section 2.1(a);
(xiii) all books and records pertaining to the other
property described in this Section 2.1(a);
(xiv) all property of the type described in this
Section 2.1(a) of any Grantor held by the Collateral Agent or any other
Secured Party, including all such property of every description, in the
possession or custody of or in transit to the Collateral Agent or such Secured
Party for any purpose, including safekeeping, collection or pledge, for the
account of such Grantor or as to which such Grantor may have any right or
power; and
(xv) to the extent not otherwise included, all Proceeds
of any or all of the foregoing;
provided, however, that "Multi-Currency Collateral" shall not include any
Excluded Property; and provided, further, that if any Excluded Property would
have otherwise constituted Multi-Currency Collateral, when such property shall
cease to be Excluded Property, such property shall be deemed at all times from
and after the date hereof to constitute Multi-Currency Collateral.
(b) For the purposes of this Agreement, except to the
extent specified in Section 2.1(a) as "Multi-Currency Collateral", all of the
following property now owned or at any time hereafter acquired by a Grantor
(other than Revlon) or in which such Grantor now has or at any time in the
future may acquire any right, title or interests, together with the Parent
Collateral (as defined below), are collectively referred to as the "Term Loan
Collateral":
(i) all Intellectual Property, except to the extent
specified in Section 2.1(a) as "Multi-Currency Collateral";
(ii) all other General Intangibles, except to the
extent specified in Section 2.1(a) as "Multi-Currency Collateral";
(iii) all Stock or Stock Equivalents issued by any
Subsidiaries of the Company and any certificates representing such Stock
or Stock Equivalents;
(iv) the Commercial Tort Claims described on Schedule 7
(Commercial Tort Claims) and on any supplement thereto received by the
Collateral Agent pursuant to Section 4.11 (Notice of Commercial Tort
Claims);
(v) all property of the type described in this Section
2.1(b) of any Grantor held by the Collateral Agent or any other Secured
Party, including all such property of every description, in the
possession or custody of or in transit to the Collateral Agent or such
Secured Party for any purpose, including safekeeping, collection or
pledge, for the account of such Grantor or as to which such Grantor may
have any right or power;
(vi) all Documents pertaining to the other
property described in this Section 2.1(b);
(vii) all books and records pertaining to the other
property described in this Section 2.1(b);
(viii) all other Goods and personal property of such
Grantor, whether tangible or intangible and wherever located; and
(ix) to the extent not otherwise included, all Proceeds
of any or all of the foregoing;
provided, however, that "Term Loan Collateral" shall not include any Excluded
Property; and provided, further, that if any Excluded Property would have
otherwise constituted Term Loan Collateral, when such property shall cease to
be Excluded Property, such property shall be deemed at all times from and
after the date hereof to constitute Term Loan Collateral.
(c) For the purposes of this Agreement, all of the following
property now owned or at any time hereafter acquired by Revlon or in which
Revlon now has or at any time in the future may acquire any right, title or
interests is collectively referred to as the "Parent Collateral":
(i) all of the Stock or Stock Equivalents of any direct
Subsidiary of Revlon (the "Parent Pledged Stock");
(ii) all additional shares of Stock or Stock
Equivalents of any issuer of Pledged Stock acquired from time to time by
Revlon in any manner and all shares of any Person who, after the date of
this Agreement, becomes, as a result of any occurrence, a direct
Subsidiary of Revlon;
(iii) the certificates representing the shares referred
to in clauses (i) and (ii) above; and
(iv) all dividends, cash, interest, instruments and
other property or Proceeds, from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of the
foregoing.
Section 2.2 Grants of Security Interest in Collateral
(a) Each Grantor, as collateral security for the full,
prompt and complete payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of the Multi-Currency Secured
Obligations of such Grantor, hereby mortgages, pledges and hypothecates to the
Collateral Agent for the benefit of the Multi-Currency Secured Parties, and
grants to the Collateral Agent for the benefit of the Multi-Currency Secured
Parties, a lien on and security interest in, all of its right, title and
interest in, to and under the Multi-Currency Collateral of such Grantor;
provided, however, that, if and when any property that at any time constituted
Excluded Property becomes Multi-Currency Collateral, the Collateral Agent
shall have, and at all times from and after the date hereof be deemed to have
had, a security interest in such property. The continuing security interest
and Lien granted above in this Section 2.2(a) by the Grantors to the
Collateral Agent for the benefit of the Multi-Currency Secured Parties are
referred to as the "First Priority Multi-Currency Collateral Liens".
(b) Each Grantor, as collateral security for the full,
prompt and complete payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of the Term Loan Secured Obligations
of such Grantor, hereby mortgages, pledges and hypothecates to the Collateral
Agent for the benefit of the Term Loan Secured Parties, and grants to the
Collateral Agent for the benefit of the Term Loan Secured Parties, a lien on
and security interest in, all of its right, title and interest in, to and
under the Multi-Currency Collateral of such Grantor; provided, however, that,
if and when any property that at any time constituted Excluded Property
becomes Multi-Currency Collateral, the Collateral Agent shall have, and at all
times from and after the date hereof be deemed to have had, a security
interest in such property. The continuing security interest and Lien granted
above in this Section 2.2(b) by the Grantors to the Collateral Agent for the
benefit of the Term Loan Secured Parties are referred to as "Second Priority
Multi-Currency Collateral Liens". The First Priority Multi-Currency Collateral
Liens on any or all of the Multi-Currency Collateral shall take priority over
the Second Priority Multi-Currency Collateral Liens and the Second Priority
Multi-Currency Collateral Liens shall be and are hereby rendered subordinate
and inferior in priority to the First Priority Multi-Currency Collateral Liens
on such Multi-Currency Collateral.
(c) Each Grantor, as collateral security for the full,
prompt and complete payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of the Term Loan Secured Obligations
of such Grantor, hereby mortgages, pledges, and hypothecates to the Collateral
Agent for the benefit of the Term Loan Secured Parties, and grants to the
Collateral Agent for the benefit of the Term Loan Secured Parties, a lien on
and security interest in, all of its right, title and interest in, to and
under the Term Loan Collateral of such Grantor; provided, however, that, if
and when any property that at any time constituted Excluded Property becomes
Term Loan Collateral, the Collateral Agent shall have, and at all times from
and after the date hereof be deemed to have had, a security interest in such
property. The continuing security interest and Lien granted above in this
Section 2.2(c) by the Grantors to the Collateral Agent for the benefit of the
Term Loan Secured Parties are referred to as "First Priority Term Loan
Collateral Liens".
(d) Each Grantor, as collateral security for the full,
prompt and complete payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of the Multi-Currency Secured
Obligations of such Grantor, hereby mortgages, pledges, hypothecates and
grants to the Collateral Agent for the benefit of the Multi-Currency Secured
Parties, a lien on and security interest in, all of its right, title and
interest in, to and under the Term Loan Collateral of such Grantor; provided,
however, that, if and when any property that at any time constituted Excluded
Property becomes Term Loan Collateral, the Collateral Agent shall have, and at
all times from and after the date hereof be deemed to have had, a security
interest in such property. The continuing security interest and Lien granted
above in this Section 2.2(d) by the Grantors to the Collateral Agent for the
benefit of the Multi-Currency Secured Parties are referred to as "Second
Priority Term Loan Collateral Liens". The First Priority Term Loan Collateral
Liens on any or all of the Term Loan Collateral shall take priority over the
Second Priority Term Loan Collateral Liens and the Second Priority Term Loan
Collateral Liens shall be and are hereby rendered subordinate and inferior in
priority to the First Priority Term Loan Collateral Liens on such Term Loan
Collateral.
(e) Notwithstanding anything to the contrary contained in
this Agreement, the Liens granted above, and the relative priority thereof,
shall be as set forth in, and subject to the terms and conditions of, the
Intercreditor Agreement.
Section 2.3 Cash Collateral Account
The Collateral Agent has established a Deposit Account
under its direction at Citibank, N.A., designated as "Citicorp USA,
Inc.-Revlon Consumer Products Corporation Collateral Account". Such Deposit
Account shall be a Cash Collateral Account.
Article III REPRESENTATIONS AND WARRANTIES
To induce the Lenders, the Issuing Lenders, the Collateral
Agent and the Administrative Agents to enter into the Credit Agreement, each
Grantor hereby represents and warrants each of the following to the Collateral
Agent for the benefit of the Secured Parties:
Section 3.1 Title; No Other Liens
Except for the Liens granted to the Collateral Agent
pursuant to this Agreement and the other Liens permitted to exist on the
Collateral under the Credit Agreement, such Grantor (a) is the record and
beneficial owner of the Pledged Collateral pledged by it hereunder
constituting Instruments or Certificated Securities, (b) is the Entitlement
Holder of all such Pledged Collateral constituting Investment Property held in
a Securities Account (unless the Collateral Agent has otherwise been declared
the Entitlement Holder of such Pledged Collateral) and (c) has rights in or
the power to transfer each other item of Collateral in which a Lien is granted
by it hereunder, free and clear of any other Lien.
Section 3.2 Perfection and Priority
The security interests granted pursuant to this Agreement
shall constitute valid and continuing perfected security interests in favor of
the Collateral Agent in the Collateral for which perfection is governed by the
UCC (other than Vehicles) or filing with the United States Copyright Office
upon (i) in the case of all Collateral in which a security interest may be
perfected by filing a financing statement under the UCC, the completion of the
filings and other actions specified on Schedule 3 (Filings) (which, in the
case of all filings and other documents referred to on such schedule, have
been delivered to the Collateral Agent in completed and duly executed form),
(ii) the delivery to the Collateral Agent of all Collateral consisting of
Instruments and Certificated Securities, in each case, properly endorsed for
transfer to the Collateral Agent or in blank, and all other Collateral which
may be perfected under the UCC only by possession, (iii) the execution of
Securities Account Control Agreements with respect to Investment Property not
in certificated form, (iv) the execution of Deposit Account Control Agreements
with respect to all Deposit Accounts of a Grantor, (v) all appropriate filings
having been made with the United States Copyright Office, and (vi) with
respect to any Letter of Credit Rights, the consent to the assignment of
proceeds of the relevant letter of credit by the issuer or any nominated
person in respect thereof, except to the extent that such Letter of Credit
Right is a supporting obligation (as defined in the UCC) for any Collateral.
With the exception of the subordination of (i) the Second Priority
Multi-Currency Collateral Liens to the First Priority Multi-Currency
Collateral Liens and (ii) the Second Priority Term Loan Collateral Liens to
the First Priority Term Loan Collateral Liens pursuant to this Agreement and
the Intercreditor Agreement, such security interests shall be prior to all
other Liens on the Collateral except for Customary Permitted Liens having
priority over the Collateral Agent's Lien by operation of law or otherwise as
permitted under the Credit Agreement.
Section 3.3 Jurisdiction of Organization; Chief Executive Office
Such Grantor's jurisdiction of organization, legal name,
organizational identification number, if any, and the location of such
Grantor's chief executive office or sole place of business, in each case as of
the date hereof, is specified on Schedule 1 (Jurisdiction of Organization;
Principal Executive Office) and such Schedule 1 (Jurisdiction of Organization;
Principal Executive Office) also lists all jurisdictions of incorporation,
legal names and locations of such Grantor's chief executive office or sole
place of business for the five years preceding the date hereof.
Section 3.4 Inventory and Equipment
On the date hereof, such Grantor's Inventory and Equipment
(other than mobile goods and Inventory or Equipment in transit) are kept at
the locations listed on Schedule 4 (Location of Inventory and Equipment) and
such Schedule 4 (Location of Inventory and Equipment) also lists the locations
of such Inventory and Equipment for the four months preceding the date hereof.
Section 3.5 Pledged Collateral
(a) The Pledged Stock pledged hereunder by such Grantor
is listed on Schedule 2 (Pledged Collateral) and constitutes that percentage
of the issued and outstanding equity of all classes of each issuer thereof as
set forth on Schedule 2 (Pledged Collateral), in each case, as supplemented by
a Pledge Amendment, duly executed by the Grantor, in substantially the form of
Annex 3 (Form of Pledge Amendment) (each a "Pledge Amendment") from time to
time hereunder.
(b) All of the Pledged Stock (other than Pledged Stock
in limited liability companies and partnerships) pledged hereunder by such
Grantor has been duly authorized, validly issued and is fully paid and
nonassessable (to the extent such concepts are applicable under the laws of
the jurisdiction of organization of the issuer thereof).
(c) Each of the Pledged Stock constitutes the legal,
valid and binding obligation of the obligor with respect thereto, enforceable
(to the extent such concepts are applicable to such Pledged Stock under the
laws of the jurisdiction of organization of the issuer thereof) in accordance
with its terms, subject to the effects of applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, and general equitable
principles, whether considered in a proceeding in equity or at law.
(d) Subject to Section 10.16 of the Credit Agreement,
all Pledged Collateral and, if applicable, any Additional Pledged Collateral,
consisting of Certificated Securities or Instruments has been delivered to the
Collateral Agent in accordance with Section 4.4(a) (Pledged Collateral) and
Section 10.11 of the Credit Agreement.
(e) Except as permitted by the Credit Agreement, all
Pledged Collateral held by a Securities Intermediary in a Securities Account
is in a Control Account.
(f) Except as permitted by the Credit Agreement, other
than Pledged Stock constituting General Intangibles, there is no Pledged
Collateral other than that represented by Certificated Securities or
Instruments in the possession of the Collateral Agent or that consist of
Financial Assets held in a Control Account.
Section 3.6 Accounts
No amount payable to such Grantor under or in connection
with any Account is evidenced by any Instrument or Chattel Paper that has not
been delivered to the Collateral Agent, properly endorsed for transfer, to the
extent delivery is required by Section 4.4 (Pledged Collateral).
Section 3.7 Intellectual Property
(a) Schedule 5A (Intellectual Property) lists all registered
Intellectual Property of such Grantor on the date hereof, separately
identifying that owned by such Grantor and that licensed to such Grantor.
Schedule 5B (Material Intellectual Property) includes all Material
Intellectual Property of such Grantor on the date hereof, separately
identifying that owned by such Grantor and that licensed to such Grantor. The
Intellectual Property set forth on Schedule 5B (Material Intellectual
Property) for such Grantor, as updated pursuant to Section 4.7(g), constitutes
all of the Material Intellectual Property as of the date on which such
schedule, or update, is delivered to the Collateral Agent.
(b) All Material Intellectual Property owned by such Grantor
is valid, subsisting, unexpired (in the case of any registered Material
Intellectual Property) and enforceable, has not been adjudged invalid and has
not been abandoned, and, to the knowledge of such Grantor, the use thereof in
the business of such Grantor does not infringe, misappropriate, dilute or
violate the intellectual property rights of any other Person, except any such
infringement, misappropriation, dilution or violation that could not
reasonably be expected to adversely affect the net revenues of the Company and
its Subsidiaries, taken as a whole, by $5,000,000 or more in the aggregate.
(c) No holding, decision or judgment has been rendered by
any Governmental Authority in a case involving such Grantor that would limit,
cancel or question the validity of, or such Grantor's rights in, any Material
Intellectual Property owned by such Grantor.
(d) There are no judgments or settlements to be paid by such
Grantor relating to the Material Intellectual Property in an aggregate amount
of $5,000,000 or more and no claims relating to the Material Intellectual
Property which could reasonably be expected to adversely affect the net
revenues of the Company and its Subsidiaries, taken as a whole, by $5,000,000
or more in the aggregate.
Section 3.8 Deposit Accounts; Securities Accounts
The only Deposit Accounts or Securities Accounts maintained
by any Grantor on the date hereof are those listed on Schedule 6 (Bank
Accounts; Control Accounts), which sets forth such information separately for
each Grantor.
Section 3.9 Commercial Tort Claims
The only Commercial Tort Claims of any Grantor existing on
the date hereof (regardless of whether the amount, defendant or other material
facts can be determined and regardless of whether such Commercial Tort Claim
has been asserted, threatened or has otherwise been made known to the obligee
thereof or whether litigation has been commenced for such claims) are those
listed on Schedule 7 (Commercial Tort Claims), which sets forth such
information separately for each Grantor.
Article IV COVENANTS
Each Grantor agrees with the Collateral Agent to the
following, until the Payment Obligations have been Fully Satisfied and, in
each case, unless the Administrative Agents otherwise consent in writing:
Section 4.1 Generally
Such Grantor shall (a) except for the security interests
created by this Agreement, not create or suffer to exist any Lien upon or with
respect to any Collateral, except Liens permitted under Section 11.3
(Limitation on Liens) of the Credit Agreement, (b) not use or permit any
Collateral to be used unlawfully or in violation of any provision of this
Agreement, any other Loan Document, any Requirement of Law or any policy of
insurance covering the Collateral, (c) not sell, transfer or assign (by
operation of law or otherwise) any Collateral except as permitted under the
Credit Agreement, (d) not enter into any agreement or undertaking restricting
the right or ability of such Grantor or the Collateral Agent to sell, assign
or transfer any Collateral except as permitted under the Credit Agreement, and
(e) promptly notify the Collateral Agent of its entry into any agreement or
assumption of undertaking that restricts the ability to sell, assign or
transfer any Collateral regardless of whether or not it has a Material Adverse
Effect.
Section 4.2 Maintenance of Perfected Security Interest; Further
Documentation
(a) Except as permitted by the Credit Agreement, such
Grantor shall maintain the security interests created by this Agreement as
perfected security interests having at least the priorities described in
Section 2.2 (Grants of Security Interest in Collateral) and Section 3.2
(Perfection and Priority) and shall defend such security interests and the
applicable priorities of such security interests against the claims and
demands of all Persons.
(b) Such Grantor shall furnish to the Collateral Agent from
time to time statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as the
Collateral Agent may reasonably request, all in reasonable detail and in form
and scope reasonably satisfactory to the Collateral Agent.
(c) At any time and from time to time, upon the written
request of the Collateral Agent, and at the sole expense of such Grantor, such
Grantor shall promptly and duly execute and deliver, and have recorded, such
further instruments and documents and take such further action as the
Collateral Agent may request (at the direction of any Administrative Agent in
its sole discretion exercised reasonably and in accordance with customary
business practices for comparable loan transactions) for the purpose of
obtaining or preserving the full benefits of this Agreement and of the rights
and powers herein granted, including the filing of any financing or
continuation statement under the UCC (or other similar laws) in effect in any
jurisdiction within the United States, United Kingdom, Bermuda or such other
jurisdiction to the extent such jurisdiction is, directly or indirectly, one
of the top five net revenue generating markets of the Company and its
Subsidiaries, with respect to the security interests created hereby and the
execution and delivery of Deposit Account Control Agreements and Securities
Account Control Agreements.
Section 4.3 Changes in Locations, Name, Etc.
(a) Except upon 15 days' prior written notice to the
Collateral Agent (or such other notice satisfactory to the Collateral Agent)
and delivery to the Collateral Agent of (i) all additional financing
statements and other documents reasonably requested by the Collateral Agent to
maintain the validity, perfection and priority of the security interests
provided for herein and (ii) if applicable, a written supplement to Schedule 4
(Location of Inventory and Equipment) showing (A) any additional locations at
which Inventory or Equipment shall be kept or (B) any changes in any location
where Inventory or Equipment shall be kept that would require the Collateral
Agent to take any action to maintain a perfected security interest in such
Collateral, such Grantor shall not do any of the following:
(i) permit any Inventory or Equipment to be kept at a
location other than those listed on Schedule 4 (Location of Inventory and
Equipment), except for Inventory or Equipment in transit or Inventory and
Equipment with an aggregate value of less than $1,000,000;
(ii) change its jurisdiction of organization or its
location, in each case from that referred to in Section 3.3 (Jurisdiction
of Organization; Chief Executive Office); or
(iii) change its legal name or any trade name used to
identify it in the conduct of its business or ownership of its properties
or organizational identification number, if any, or corporation, limited
liability company or other organizational structure to such an extent
that any financing statement filed in connection with this Agreement
would become misleading.
(b) Such Grantor shall keep and maintain at its own
cost and expense records of the Collateral, including a record of
payments received and credits granted with respect to the Collateral and
such other dealings with the Collateral, in form and substance reasonably
satisfactory to the Collateral Agent.
Section 4.4 Pledged Collateral
(a) Such Grantor shall (i) deliver to the Collateral
Agent, all certificates and Instruments representing or evidencing any Pledged
Collateral (including Additional Pledged Collateral, but excluding any
Instrument or Chattel Paper that is excluded from the delivery requirements of
Section 4.6), whether now existing or hereafter acquired, in suitable form for
transfer by delivery or, as applicable, accompanied by such Grantor's
endorsement, where necessary, or duly executed instruments of transfer or
assignment in blank, all in form and substance reasonably satisfactory to the
Collateral Agent, together, in respect of any Additional Pledged Collateral,
with a Pledge Amendment, an acknowledgment and agreement to a Joinder
Agreement duly executed by the Grantor, in substantially the form in the form
of Annex 4 (Form of Joinder Agreement), or such other documentation reasonably
acceptable to the Collateral Agent and (ii) except as permitted by the Credit
Agreement, maintain all other Pledged Collateral constituting Investment
Property in a Control Account. Such Grantor authorizes the Collateral Agent to
attach each Pledge Amendment to this Agreement. For the purpose of obtaining
or preserving the full benefits of this Agreement and of the rights and powers
herein granted, the Collateral Agent shall have the right in its reasonable
discretion, at any time (i) upon request and if the Company fails to comply
with such request, to the extent necessary or appropriate to perfect the
security interests contemplated herein, and (ii) during an Event of Default,
without notice to the Grantor, to transfer to or to register in its name or in
the name of its nominees any Pledged Collateral. The Collateral Agent shall
have the right at any time to exchange any certificate or instrument
representing or evidencing any Pledged Collateral for certificates or
instruments of smaller or larger denominations.
(b) Except as provided in Article V (Remedial
Provisions), such Grantor shall be entitled to receive all cash dividends,
distributions, principal and interest paid in respect of the Pledged
Collateral (other than liquidating or distributing dividends) with respect to
the Pledged Collateral. Any sums paid upon or in respect of any Pledged
Collateral upon the liquidation or dissolution of any issuer of any Pledged
Collateral, any distribution of capital made on or in respect of any Pledged
Collateral or any property distributed upon or with respect to any Pledged
Collateral pursuant to the recapitalization or reclassification of the capital
of any issuer of Pledged Collateral or pursuant to the reorganization thereof
shall, unless otherwise (i) subject to a perfected security interest (with the
priorities contemplated herein) in favor of the Collateral Agent or (ii)
applied in accordance with the Credit Agreement, be delivered to the
Collateral Agent to be held by it hereunder as additional collateral security
for the Secured Obligations. If any sum of money or property so paid or
distributed in respect of any Pledged Collateral shall be received by such
Grantor, such Grantor shall, until such money or property is paid or delivered
to the Collateral Agent, hold such money or property in trust for the
Collateral Agent, segregated from other funds of such Grantor, as additional
security for the Secured Obligations.
(c) Except as provided in Article V (Remedial
Provisions), such Grantor shall be entitled to exercise all voting, consent
and corporate, partnership, limited liability company and similar rights with
respect to the Pledged Collateral; provided, however, that no vote shall be
cast, consent given or right exercised or other action taken by such Grantor
that would impair the Collateral (except to the extent permitted under the
Credit Agreement), be inconsistent with or result in any violation of any
provision of the Credit Agreement, this Agreement or any other Loan Document
or, without prior notice to the Collateral Agent, enable or permit any issuer
of Pledged Collateral controlled by the Company to issue any Stock or other
equity Securities of any nature or to issue any other securities convertible
into or granting the right to purchase or exchange for any Stock or other
equity Securities of any nature of any issuer of Pledged Collateral.
(d) Such Grantor shall not grant "control" (within the
meaning of such term under Article 9-106 of the UCC) over any Investment
Property of such Grantor to any Person other than the Collateral Agent, except
to the extent permitted under the Credit Agreement.
(e) In the case of each Grantor that is an issuer of
Pledged Collateral, such Grantor agrees to be bound by the terms of this
Agreement relating to the Pledged Collateral issued by it and shall comply
with such terms insofar as such terms are applicable to it. In the case of any
Grantor that is a holder of any Stock or Stock Equivalent in any Person that
is an issuer of Pledged Collateral, such Grantor consents to (i) the exercise
of the rights granted to the Collateral Agent hereunder (including those
described in Section 5.3 (Pledged Collateral)), and (ii) the pledge by each
other Grantor, pursuant to the terms hereof, of the Pledged Stock in such
Person and, to the extent required in Section 4.4(a), to the transfer of such
Pledged Stock to the Collateral Agent or its nominee and to the substitution
of the Collateral Agent or its nominee as a holder of such Pledged Stock with
all the rights, powers and duties of other holders of Pledged Stock of the
same class and, if the Grantor having pledged such Pledged Stock hereunder had
any right, power or duty at the time of such pledge or at the time of such
substitution beyond that of such other holders, with all such additional
rights, powers and duties. Such Grantor agrees to execute and deliver to the
Collateral Agent such certificates, agreements and other documents as may be
necessary, in the reasonable judgment of the Company or the Collateral Agent,
to evidence, formalize or otherwise give effect to the consents given in this
clause (e).
(f) Such Grantor shall not, without the consent of the
Collateral Agent, agree to any amendment of any Constituent Document that in
any way adversely affects the perfection of the security interest of the
Collateral Agent in the Pledged Collateral pledged by such Grantor hereunder,
including any amendment electing to treat any membership interest or
partnership interest that is part of the Pledged Collateral as a "security"
under Section 8-103 of the UCC, or any election to turn any previously
uncertificated Stock that is part of the Pledged Collateral into certificated
Stock.
Section 4.5 Accounts
Unless the Multi-Currency Administrative Agent shall
otherwise consent, such Grantor shall not, other than in the ordinary course
of business consistent with its past practice, (i) grant any extension of the
time of payment of any Account, (ii) compromise or settle any Account for less
than the full amount thereof, (iii) release, wholly or partially, any Person
liable for the payment of any Account, (iv) allow any credit or discount on
any Account or (v) amend, supplement or modify any Account in any manner that
could reasonably be expected to adversely affect the value thereof.
Section 4.6 Delivery of Instruments and Chattel Paper
If any amount in excess of $2,000,000 payable under or
in connection with any Collateral owned by such Grantor shall be or become
evidenced by an Instrument or Chattel Paper, such Grantor shall promptly
deliver such Instrument or Chattel Paper to the Collateral Agent, duly
indorsed in a manner reasonably satisfactory to the Collateral Agent, or, if
consented to by the Collateral Agent, shall mark all such Instruments and
Chattel Paper with the following legend: "This writing and the obligations
evidenced or secured hereby are subject to the security interest of Citicorp
USA, Inc., as Collateral Agent for the benefit of the Secured Parties".
Section 4.7 Intellectual Property
(a) Such Grantor (either itself or through licensees)
shall (i) continue to use each Trademark that is Material Intellectual
Property in order to maintain such Trademark in full force and effect with
respect to each class of goods for which such Trademark is currently used,
free from any claim of abandonment for non-use, (ii) maintain consistent with
past practice the quality of products and services offered under such
Trademark, (iii) use such Trademark with the appropriate notice of
registration and all other notices and legends, in each case, as required by
applicable Requirements of Law, (iv) not adopt or use any mark that is
confusingly similar or a colorable imitation of such Trademark unless the
Collateral Agent shall obtain perfected security interests in such mark
pursuant to this Agreement and (v) not (and not permit any licensee or
sublicensee thereof to) do any other act or knowingly omit to do any act
whereby such Trademark (or any goodwill associated therewith) may become
destroyed, invalidated, impaired or harmed in any way.
(b) Such Grantor (either itself or through licensees)
shall not do any act, or omit to do any act, whereby any Patent that is
Material Intellectual Property may become forfeited, abandoned or dedicated to
the public.
(c) Such Grantor (either itself or through licensees)
(i) shall not (and shall not permit any licensee or sublicensee thereof to) do
any act or omit to do any act whereby any portion of the Copyrights that is
Material Intellectual Property may become invalidated or otherwise impaired
and (ii) shall not (either itself or through licensees) do any act whereby any
portion of the Copyrights that is Material Intellectual Property may fall into
the public domain.
(d) Such Grantor (either itself or through licensees)
shall not do any act, or omit to do any act, which would substantially
increase the risk of any trade secret that is Material Intellectual Property
becoming publicly available or otherwise unprotectable; provided, however,
that execution and delivery of any agreement related to such trade secret
subject to customary and reasonable confidentiality provisions shall not
constitute a breach of this clause (d).
(e) Such Grantor (either itself or through licensees)
shall not do any act that knowingly uses any Material Intellectual Property to
infringe, misappropriate, or violate any valid intellectual property right of
any other Person.
(f) Such Grantor shall notify the Collateral Agent
promptly if it knows, after due inquiry, that (i) any application or
registration relating to any Material Intellectual Property is likely to
become forfeited, abandoned or dedicated to the public, or of any adverse
determination or development related to such application or registration
(including the institution of, or any such determination or development in,
any proceeding in the United States Patent and Trademark Office or the United
States Copyright Office or any court or tribunal in any country, but excluding
any ordinary course office actions) regarding such Grantor's ownership of,
right to use, interest in, or the validity of, any Material Intellectual
Property owned by such Grantor or such Grantor's right to register the same or
to own and maintain the same or (ii) any action or proceeding seeking to
limit, cancel or question the validity of any Material Intellectual Property
owned by such Grantor or such Grantor's ownership interest therein is pending
or, to the knowledge of such Grantor, threatened.
(g) The Grantors shall deliver to the Administrative
Agents and the Collateral Agent, by each January 31st and July 31st of each
year following the date hereof, commencing January 31, 2005 (or, if the Term
Loan Administrative Agent reasonably so requests in writing, more often;
provided, however, that, except during such time as a Default or Event of
Default has occurred and is continuing, the Term Loan Administrative Agent
shall not so request more frequently than monthly), an update of Schedule 5B
(Material Intellectual Property), listing all of the Material Intellectual
Property of the Company and its Subsidiaries as of such date and any licensing
or franchise agreement with respect thereto pursuant to which such Grantor is
the licensor or franchisor.
(h) Such Grantor shall take all reasonable actions
necessary or requested by the Collateral Agent, including in any proceeding
before the United States Patent and Trademark Office, the United States
Copyright Office or any similar office or agency, to maintain and pursue each
application (and to obtain the relevant registration) and to maintain each
registration of any Copyright, Trademark, Patent or Internet domain name that
is Material Intellectual Property, including filing of applications for
renewal, affidavits of use, affidavits of incontestability and opposition and
interference and cancellation proceedings.
(i) In the event that any Material Intellectual
Property is or has been infringed upon or misappropriated or diluted by a
third party, which event could reasonably be expected to adversely affect the
net revenues of the Company and its Subsidiaries, taken as a whole, by more
than $5,000,000 in the aggregate, such Grantor shall notify the Collateral
Agent promptly after such Grantor learns thereof. Such Grantor shall take
appropriate action in its reasonable judgment in response to such
infringement, misappropriation or dilution, including promptly bringing suit
for infringement, misappropriation or dilution and to recover all damages for
such infringement, misappropriation or dilution, and shall take such other
actions as may be appropriate in its reasonable judgment under the
circumstances to protect such Material Intellectual Property.
(j) At such times required by Section 10.14 of the
Credit Agreement, such Grantor shall execute and deliver to the Collateral
Agent for filing in (i) the United States Copyright Office a short-form
copyright security agreement in the form attached hereto as Annex 5 (Form of
Short Form Intellectual Property Security Agreement), (ii) in the United
States Patent and Trademark Office and with the Secretary of State of all
appropriate States of the United States a short-form trademark security
agreement in the form attached hereto as Annex 5 (Form of Short Form
Intellectual Property Security Agreement), and (iii) the United States Patent
and Trademark Office a short-form patent security agreement in form attached
hereto as Annex 5 (Form of Short Form Intellectual Property Security
Agreement).
(k) Notwithstanding anything to the contrary in this
Section 4.7, (i) the Grantor shall have the right to license its Patents and
Trademarks in accordance with Section 10.14(d) of the Credit Agreement and
(ii) no Grantor shall be prohibited from causing or permitting the expiration,
abandonment or invalidation of any of the Intellectual Property (other than
Material Intellectual Property) or failing to renew, abandoning or permitting
to expire any applications or registrations for any of the Intellectual
Property (other than Material Intellectual Property), if, in such Grantor's
reasonable good faith judgment, there is a reasonable and valid business
reason for taking or omitting to take such action.
Section 4.8 Vehicles
Upon the reasonable request of the Collateral Agent,
within 30 days after the date of such request and, with respect to any Vehicle
acquired by such Grantor subsequent to the date of any such request (until
such request is withdrawn by the Collateral Agent), within 30 days after the
date of acquisition thereof, such Grantor shall file all applications for
certificates of title or ownership indicating the Collateral Agent's first and
second priority security interests in the Vehicle covered by such certificate
and any other necessary documentation, in each office in each jurisdiction
that the Collateral Agent shall deem advisable to perfect its security
interests in the Vehicles.
Section 4.9 Payment of Payment Obligations
Except as permitted by Section 10.3 or Section 11.3 of
the Credit Agreement, such Grantor shall pay and discharge or otherwise
satisfy at or before maturity or before they become delinquent, as the case
may be, all taxes, assessments and governmental charges or levies (other than
maintenance payments for Patents, to the extent that such Grantor is permitted
to abandon such Patent in accordance with the terms of the Loan Documents)
imposed upon the Collateral or in respect of income or profits therefrom, as
well as all claims of any kind (including claims for labor, materials and
supplies) against or with respect to the Collateral, except that no such tax,
assessment, levy, claim or charge need be paid if the amount or validity
thereof is currently being contested in good faith by appropriate proceedings,
reserves in conformity with GAAP with respect thereto have been provided on
the books of such Grantor and such proceedings could not reasonably be
expected to result in the sale, forfeiture or loss of any material portion of
the Collateral or any interest therein.
Section 4.10 Insurance
Such Grantor shall (i) maintain, and cause to be
maintained for each of its Subsidiaries, insurance in accordance with Section
10.5 of the Credit Agreement and (ii) cause all such insurance maintained for
such Grantor to name the Collateral Agent on behalf of the Secured Parties as
additional insured or loss payee, as appropriate, and to provide that no
cancellation, material addition in amount or material change in coverage shall
be effective until after 30 days' written notice thereof to the Collateral
Agent (or such shorter period as acceptable to the Collateral Agent).
Section 4.11 Notice of Commercial Tort Claims
Such Grantor agrees that, if it shall acquire any
interest in any Commercial Tort Claim (whether from another Person or because
such Commercial Tort Claim shall have come into existence) in excess of
$2,500,000, (i) such Grantor shall, promptly upon such acquisition, deliver to
the Collateral Agent, in each case in form and substance reasonably
satisfactory to the Collateral Agent, a notice of the existence and nature of
such Commercial Tort Claim and deliver a supplement to Schedule 7 (Commercial
Tort Claims) containing a specific description of such Commercial Tort Claim,
(ii) the provision of Section 2.1 (Collateral) shall apply to such Commercial
Tort Claim and (iii) such Grantor shall execute and deliver to the Collateral
Agent, in each case in form and substance reasonably satisfactory to the
Collateral Agent, any certificate, agreement and other document, and take all
other action, deemed by the Collateral Agent to be reasonably necessary or
appropriate for the Collateral Agent to obtain, on behalf of the Term Loan
Secured Parties, a first-priority, perfected security interest in all such
Commercial Tort Claims, and on behalf of the Multi-Currency Secured Parties, a
second-priority, perfected security interest in all such Commercial Tort
Claims. Any supplement to Schedule 7 (Commercial Tort Claims) delivered
pursuant to this Section 4.11 (Notice of Commercial Tort Claims) shall, after
the receipt thereof by the Collateral Agent, become part of Schedule 7
(Commercial Tort Claims) for all purposes hereunder other than in respect of
representations and warranties made prior to the date of such receipt.
Article V REMEDIAL PROVISIONS
Section 5.1 Code and Other Remedies
During the continuance of an Event of Default, the
Collateral Agent may in accordance with the terms of the Intercreditor
Agreement exercise, in addition to all other rights and remedies granted to it
in this Agreement and in any other instrument or agreement securing,
evidencing or relating to the Secured Obligations, all rights and remedies of
a secured party under the UCC or any other applicable law. Without limiting
the generality of the foregoing, the Collateral Agent, without demand of
performance or other demand, presentment, protest, advertisement or notice of
any kind (except any notice required by law referred to below) to or upon any
Grantor or any other Person (all and each of which demands, defenses,
advertisements and notices are hereby waived to the extent permitted by
applicable law), may in such circumstances forthwith collect, receive,
appropriate and realize upon any Collateral, and may forthwith sell, lease,
assign, give option or options to purchase, or otherwise dispose of and
deliver any Collateral (or contract to do any of the foregoing), in one or
more parcels at public or private sale or sales, at any exchange, broker's
board or office of the Collateral Agent or any Secured Party or elsewhere upon
such terms and conditions as it may deem advisable and at such prices as it
may deem best, for cash or on credit or for future delivery without assumption
of any credit risk. Subject to the terms of the Intercreditor Agreement, the
Collateral Agent shall have the right upon any such public sale or sales, and,
to the extent permitted by the UCC and other applicable law, upon any such
private sale or sales, to purchase the whole or any part of the Collateral so
sold, free of any right or equity of redemption of any Grantor, which right or
equity is hereby waived and released. Each Grantor further agrees, at the
Collateral Agent's request, to assemble the Collateral and make it available
to the Collateral Agent at places that the Collateral Agent shall reasonably
select, whether at such Grantor's premises or elsewhere. The Collateral Agent
shall apply the net proceeds of any action taken by it pursuant to this
Section 5.1, after deducting all reasonable costs and expenses of every kind
incurred in connection therewith or incidental to the care or safekeeping of
any Collateral or in any way relating to the Collateral or the rights of the
Collateral Agent and any other Secured Party hereunder, including reasonable
attorneys' fees and disbursements, to the payment in whole or in part of the
Secured Obligations, in such order as the Intercreditor Agreement shall
prescribe, and only after such application and after the payment by the
Collateral Agent of any other amount required by any provision of law, need
the Collateral Agent account for the surplus, if any, to any Grantor. To the
extent permitted by applicable law, each Grantor waives all claims, damages
and demands it may acquire against the Collateral Agent or any other Secured
Party arising out of the exercise by them of any rights hereunder. If any
notice of a proposed sale or other disposition of Collateral shall be required
by law, such notice shall be deemed reasonable and proper if given at least 10
days before such sale or other disposition.
Section 5.2 Accounts and Payments in Respect of General Intangibles
(a) In addition to, and not in substitution for, any
similar requirement in the Credit Agreement, if required by the Collateral
Agent at any time during the continuance of an Event of Default, any payment
of Accounts or payment in respect of General Intangibles, when collected by
any Grantor, shall be forthwith (and, in any event, within two Business Days)
deposited by such Grantor in the exact form received, duly indorsed by such
Grantor to the Collateral Agent, in an Approved Deposit Account or a Cash
Collateral Account, subject to withdrawal by the Collateral Agent as provided
in Section 5.4 (Proceeds to be Turned Over To Collateral Agent). Until so
turned over, such payment shall be held by such Grantor in trust for the
Collateral Agent, segregated from other funds of such Grantor. Each such
deposit of Proceeds of Accounts and payments in respect of General Intangibles
shall be accompanied by a report identifying in reasonable detail the nature
and source of the payments included in the deposit.
(b) At the Collateral Agent's request, during the
continuance of an Event of Default, each Grantor shall deliver to the
Collateral Agent all original and other documents evidencing, and relating to,
the agreements and transactions that gave rise to the Accounts or payments in
respect of General Intangibles, including all original orders, invoices and
shipping receipts.
(c) Subject to the terms of the Credit Agreement, the
Collateral Agent may, without notice, at any time during the continuance of an
Event of Default, limit or terminate the authority of a Grantor to collect its
Accounts or amounts due under General Intangibles or any thereof.
(d) The Collateral Agent in its own name or in the name
of others may at any time during the continuance of an Event of Default
communicate with Account Debtors to verify with them to the Collateral Agent's
satisfaction the existence, amount and terms of any Account or amounts due
under any General Intangible.
(e) Upon the request of the Collateral Agent at any
time during the continuance of an Event of Default, each Grantor shall notify
Account Debtors that the Accounts or General Intangibles have been
collaterally assigned to the Collateral Agent and that payments in respect
thereof shall be made directly to the Collateral Agent. In addition, the
Collateral Agent may at any time during the continuance of an Event of Default
enforce such Grantor's rights against such Account Debtors and obligors of
General Intangibles.
(f) Anything herein to the contrary notwithstanding,
each Grantor shall remain liable under each of the Accounts and payments in
respect of General Intangibles to observe and perform all the conditions and
obligations to be observed and performed by it thereunder, all in accordance
with the terms of any agreement giving rise thereto. Neither the Collateral
Agent nor any other Secured Party shall have any obligation or liability under
any agreement giving rise to an Account or a payment in respect of a General
Intangible by reason of or arising out of this Agreement or the receipt by the
Collateral Agent nor any other Secured Party of any payment relating thereto,
nor shall the Collateral Agent nor any other Secured Party be obligated in any
manner to perform any obligation of any Grantor under or pursuant to any
agreement giving rise to an Account or a payment in respect of a General
Intangible, to make any payment, to make any inquiry as to the nature or the
sufficiency of any payment received by it or as to the sufficiency of any
performance by any party thereunder, to present or file any claim, to take any
action to enforce any performance or to collect the payment of any amounts
that may have been assigned to it or to which it may be entitled at any time
or times.
Section 5.3 Pledged Collateral
(a) Subject to the terms of the Intercreditor Agreement
and during the continuance of an Event of Default, upon notice by the
Collateral Agent to the relevant Grantor or Grantors, (i) the Collateral Agent
shall have the right to receive any Proceeds of the Pledged Collateral and
make application thereof to the Secured Obligations in the order set forth in
the Intercreditor Agreement and (ii) the Collateral Agent or its nominee may
exercise (A) any voting, consent, corporate and other right pertaining to the
Pledged Collateral at any meeting of shareholders, partners or members, as the
case may be, of the relevant issuer or issuers of Pledged Collateral or
otherwise and (B) any right of conversion, exchange and subscription and any
other right, privilege or option pertaining to the Pledged Collateral as if it
were the absolute owner thereof (including the right to exchange at its
discretion any of the Pledged Collateral upon the merger, amalgamation,
consolidation, reorganization, recapitalization or other fundamental change in
the corporate or equivalent structure of any issuer of Pledged Collateral, the
right to deposit and deliver any Pledged Collateral with any committee,
depositary, transfer agent, registrar or other designated agency upon such
terms and conditions as the Collateral Agent may determine), all without
liability except to account for property actually received by it; provided,
however, that the Collateral Agent shall have no duty to any Grantor to
exercise any such right, privilege or option and shall not be responsible for
any failure to do so or delay in so doing.
(b) In order to permit the Collateral Agent to exercise
the voting and other consensual rights that it may be entitled to exercise
pursuant hereto and to receive all dividends and other distributions that it
may be entitled to receive hereunder, (i) each Grantor shall promptly execute
and deliver (or cause to be executed and delivered) to the Collateral Agent
all such proxies, dividend payment orders and other instruments as the
Collateral Agent may from time to time reasonably request and (ii) without
limiting the effect of clause (i) above, such Grantor hereby grants to the
Collateral Agent an irrevocable proxy to vote all or any part of the Pledged
Collateral and to exercise all other rights, powers, privileges and remedies
to which a holder of the Pledged Collateral would be entitled (including
giving or withholding written consents of shareholders, partners or members,
as the case may be, calling special meetings of shareholders, partners or
members, as the case may be, and voting at such meetings), which proxy shall
be effective, automatically and without the necessity of any action (including
any transfer of any Pledged Collateral on the record books of the issuer
thereof) by any other Person (including the issuer of such Pledged Collateral
or any officer or agent thereof) only during the continuance of an Event of
Default and which proxy shall only terminate upon the earlier to occur of (x)
the termination of such Event of Default and (y) the payment in full of the
Secured Obligations.
(c) Each Grantor hereby expressly authorizes and
instructs each issuer of any Pledged Collateral pledged hereunder by such
Grantor to (i) comply with any instruction received by it from the Collateral
Agent in writing that (A) states that an Event of Default has occurred and is
continuing and (B) is otherwise in accordance with the terms of this
Agreement, without any other or further instructions from such Grantor, and
each Grantor agrees that such issuer shall be fully protected in so complying
and (ii) unless otherwise expressly permitted hereby, pay any dividend or
other payment with respect to the Pledged Collateral directly to the
Collateral Agent.
Section 5.4 Proceeds to be Turned Over To Collateral Agent
All Proceeds received by the Collateral Agent under
this Section 5 in cash or Cash Equivalents shall be held by the Collateral
Agent in a Cash Collateral Account. All such Proceeds while held by the
Collateral Agent in a Cash Collateral Account (or by such Grantor in trust for
the Collateral Agent) shall continue to be held as collateral security for the
Secured Obligations and shall not constitute payment thereof until applied as
provided in the Intercreditor Agreement.
Section 5.5 Registration Rights
(a) Each Grantor recognizes that the Collateral Agent
may be unable to effect a public sale of any Pledged Collateral by reason of
certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise or may determine that a public sale is
impracticable or not commercially reasonable and, accordingly, may resort to
one or more private sales thereof to a restricted group of purchasers that
shall be obliged to agree, among other things, to acquire such securities for
their own account for investment and not with a view to the distribution or
resale thereof. Each Grantor acknowledges and agrees that any such private
sale may result in prices and other terms less favorable than if such sale
were a public sale and, notwithstanding such circumstances, agrees that any
such private sale shall be deemed to have been made in a commercially
reasonable manner. The Collateral Agent shall be under no obligation to delay
a sale of any Pledged Collateral for the period of time necessary to permit
the issuer thereof to register such securities for public sale under the
Securities Act, or under applicable state securities laws, even if such issuer
would agree to do so.
(b) Each Grantor agrees to use its best efforts to do
or cause to be done all such other acts as may be necessary to make such sale
or sales of all or any portion of the Pledged Collateral pursuant to this
Section 5.5 valid and binding and in compliance with all other applicable
Requirements of Law. Each Grantor further agrees that a breach of any covenant
contained in this Section 5.5 will cause irreparable injury to the Collateral
Agent and other Secured Parties, that the Collateral Agent and the other
Secured Parties have no adequate remedy at law in respect of such breach and,
as a consequence, that each and every covenant contained in this Section 5.5
shall be specifically enforceable against such Grantor, and such Grantor
hereby waives and agrees not to assert any defense against an action for
specific performance of such covenants except for a defense that no Event of
Default has occurred and is continuing under the Credit Agreement or that the
Secured Obligations have been paid in full.
Section 5.6 Deficiency
Each Grantor shall remain liable for any deficiency if
the proceeds of any sale or other disposition of the Collateral are
insufficient to pay the Secured Obligations and the fees and disbursements of
any attorney employed by the Collateral Agent or any other Secured Party to
collect such deficiency in accordance with Section 14.6 of the Credit
Agreement.
Section 5.7 Grant of License to Use Intellectual Property
(a) Each Grantor hereby grants to the Collateral Agent,
solely to the extent necessary to enable the Collateral Agent to exercise the
rights and remedies under this Agreement and the other Security Documents, an
irrevocable, non-exclusive license (exercisable without payment of royalty or
other compensation to the Grantors) to, during the continuance of an Event of
Default, use, license or sublicense any Collateral consisting of Intellectual
Property, now owned or hereafter acquired by such Grantor and wherever the
same may be located, which license shall include reasonable access to all
media in which any of the licensed items may be recorded or stored and to all
computer software and programs used for the compilation or printout thereof.
Each of the parties hereto acknowledges and agrees that (i) any security
interest granted to the Collateral Agent or any other Secured Party hereunder
or any other Security Document on any Intellectual Property of any Grantor,
and the exercise of any rights and remedies (including any sale, transfer or
disposal) by the Collateral Agent related thereto, shall be subject to the
license granted in the foregoing sentence at all times and (ii) the Collateral
Agent may exercise such license for the benefit of any Secured Party
(including the Multi-Currency Secured Parties with respect to the sale,
transfer or disposal of any Multi-Currency Collateral), regardless of the
priority of Liens on any Collateral granted to such Secured Party, in
accordance with the Intercreditor Agreement.
(b) Notwithstanding any other provision contained in
this Agreement, any security interest granted hereunder in any Collateral
consisting of Intellectual Property shall be subject to the license granted
under the preceding paragraph (a), as such license may be exercised for the
benefit of the Secured Parties holding such license, and any sale or transfer
of such Collateral consisting of Intellectual Property upon any exercise of
remedies under this Agreement shall be made expressly subject to such license.
Article VI THE COLLATERAL AGENT
Section 6.1 Collateral Agent's Appointment as Attorney-in-Fact
(a) Subject to the last sentence of this Section
6.1(a), each Grantor hereby irrevocably constitutes and appoints the
Collateral Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of such Grantor and in the name of
such Grantor or in its own name, for the purpose of carrying out the terms of
this Agreement, to take any appropriate action and to execute any document or
instrument that may be necessary or desirable to accomplish the purposes of
this Agreement, and, without limiting the generality of the foregoing, each
Grantor hereby gives the Collateral Agent the power and right, on behalf of
such Grantor, without notice to or assent by such Grantor, to do any of the
following:
(i) in the name of such Grantor or its own name, or
otherwise, take possession of and indorse and collect any check, draft,
note, acceptance or other instrument for the payment of moneys due under
any Account or General Intangible or with respect to any other Collateral
and file any claim or take any other action or proceeding in any court of
law or equity or otherwise deemed appropriate by the Collateral Agent for
the purpose of collecting any such moneys due under any Account or
General Intangible or with respect to any other Collateral whenever
payable;
(ii) in the case of any Intellectual Property, execute
and deliver, and have recorded, any agreement, instrument, document or
paper as the Collateral Agent may request to evidence the Collateral
Agent's security interests in such Intellectual Property and the goodwill
and General Intangibles of such Grantor relating thereto or represented
thereby;
(iii) pay or discharge taxes and Liens levied or placed
on or threatened against the Collateral, effect any repair or pay any
insurance called for by the terms of this Agreement (including all or any
part of the premiums therefor and the costs thereof);
(iv) execute, in connection with any sale provided for
in Section 5.1 (Code and Other Remedies) or 5.5 (Registration Rights),
any endorsement, assignment or other instrument of conveyance or transfer
with respect to the Collateral; or
(v) (A) direct any party liable for any payment under
any Collateral to make payment of any moneys due or to become due
thereunder directly to the Collateral Agent or as the Collateral Agent
shall direct, (B) ask or demand for, collect, and receive payment of and
receipt for, any moneys, claims and other amounts due or to become due at
any time in respect of or arising out of any Collateral, (C) sign and
indorse any invoice, freight or express bill, bill of lading, storage or
warehouse receipt, draft against debtors, assignment, verification,
notice and other document in connection with any Collateral, (D) commence
and prosecute any suit, action or proceeding at law or in equity in any
court of competent jurisdiction to collect any Collateral and to enforce
any other right in respect of any Collateral, (E) defend any suit, action
or proceeding brought against such Grantor with respect to any
Collateral, (F) settle, compromise or adjust any such suit, action or
proceeding and, in connection therewith, give such discharges or releases
as the Collateral Agent may deem appropriate, (G) assign any Copyright,
Patent or Trademark (along with the goodwill of the business to which any
such Trademark pertains) throughout the world for such term or terms, on
such conditions, and in such manner as the Collateral Agent shall in its
sole discretion determine, including the execution and filing of any
document necessary to effectuate or record such assignment and (H)
generally, sell, transfer, pledge and make any agreement with respect to
or otherwise deal with any Collateral as fully and completely as though
the Collateral Agent were the absolute owner thereof for all purposes,
and do, at the Collateral Agent's option and such Grantor's expense, at
any time, or from time to time, all acts and things that the Collateral
Agent deems necessary to protect, preserve or realize upon the Collateral
and the Collateral Agent's and the other Secured Parties' security
interests therein and to effect the intent of this Agreement, all as
fully and effectively as such Grantor might do.
Anything in this clause (a) to the contrary notwithstanding, the Collateral
Agent agrees that it shall not exercise any right under the power of attorney
provided for in this clause (a) unless an Event of Default shall be
continuing.
(b) If any Grantor fails to perform or comply with any
of its agreements contained herein, the Collateral Agent, at its option, but
without any obligation so to do, may perform or comply, or otherwise cause
performance or compliance, with such agreement.
(c) The reasonable expenses of the Collateral Agent
incurred in connection with actions undertaken as provided in this Section
6.1, together with interest thereon at a rate per annum equal to the rate per
annum at which interest would then be payable on past due Revolving Loans that
are Alternate Base Rate Loans under the Credit Agreement, from the date of
payment by the Collateral Agent to the date reimbursed by the relevant
Grantor, shall be payable by such Grantor to the Collateral Agent on demand.
(d) Each Grantor hereby ratifies all that said
attorneys shall lawfully do or cause to be done by virtue hereof. All powers,
authorizations and agencies contained in this Agreement are coupled with an
interest and are irrevocable until this Agreement is terminated and the
security interests created hereby are released.
Section 6.2 Duty of Collateral Agent
The Collateral Agent's sole duty with respect to the
custody, safekeeping and physical preservation of the Collateral in its
possession shall be to deal with it in the same manner as the Collateral Agent
deals with similar property for its own account. Neither the Collateral Agent,
any other Secured Party nor any of their respective officers, directors,
employees or agents shall be liable for failure to demand, collect or realize
upon any Collateral or for any delay in doing so or shall be under any
obligation to sell or otherwise dispose of any Collateral upon the request of
any Grantor or any other Person or to take any other action whatsoever with
regard to any Collateral. The powers conferred on the Collateral Agent
hereunder are solely to protect the Collateral Agent's interest in the
Collateral and shall not impose any duty upon the Collateral Agent or any
other Secured Party to exercise any such powers. The Collateral Agent and the
other Secured Parties shall be accountable only for amounts that they actually
receive as a result of the exercise of such powers, and neither they nor any
of their respective officers, directors, employees or agents shall be
responsible to any Grantor for any act or failure to act hereunder, except for
their own gross negligence or willful misconduct.
Section 6.3 Authorization of Financing Statements
Each Grantor authorizes the Collateral Agent (and, to
the extent authorized by the Collateral Agent, its Affiliates, counsel and
other representatives), at any time and from time to time, to file or record
financing statements, amendments to financing statements, and other filing or
recording documents or instruments with respect to the Collateral in such form
and in such offices as the Collateral Agent reasonably determines appropriate
to perfect the security interests of the Collateral Agent under this Agreement
under the laws of any jurisdiction of the United States, and such financing
statements and amendments may described the Collateral covered thereby as "all
assets of the debtor", "all personal property of the debtor" or words of
similar effect. Each Grantor hereby also authorizes the Collateral Agent and
its Affiliates, counsel and other representatives, at any time and from time
to time, to file continuation statements with respect to previously filed
financing statements. A photographic or other reproduction of this Agreement
shall be sufficient as a financing statement or other filing or recording
document or instrument for filing or recording in any jurisdiction.
Section 6.4 Authority of Collateral Agent
Each Grantor acknowledges that the rights and
responsibilities of the Collateral Agent under this Agreement with respect to
any action taken by the Collateral Agent or the exercise or non-exercise by
the Collateral Agent of any option, voting right, request, judgment or other
right or remedy provided for herein or resulting or arising out of this
Agreement shall, as between the Collateral Agent and the other Secured
Parties, be governed by the Intercreditor Agreement, the Credit Agreement and
by such other agreements with respect thereto as may exist from time to time
among them, but, as between the Collateral Agent and the Grantors, the
Collateral Agent shall be conclusively presumed to be acting as agent for the
Collateral Agent and the other Secured Parties with full and valid authority
so to act or refrain from acting, and no Grantor shall be under any
obligation, or entitlement, to make any inquiry respecting such authority. To
the extent that the Intercreditor Agreement conflicts with any other Loan
Document with regard to the authority of the Collateral Agent, the
Intercreditor Agreement shall control.
Article VII MISCELLANEOUS
Section 7.1 Amendments in Writing
None of the terms or provisions of this Agreement may
be waived, amended, supplemented or otherwise modified, except in accordance
with Section 14.1 of the Credit Agreement; provided, however, that this
Agreement may be supplemented in accordance with the terms of this Agreement
(but no existing provisions may be modified and no Collateral may be released)
through Pledge Amendments and Joinder Agreements, in substantially the form of
Annex 3 (Form of Pledge Amendment) and Annex 4 (Form of Joinder Agreement)
respectively, in each case duly executed by the Collateral Agent and each
Grantor directly affected thereby in accordance with Section 10.11 (Additional
Stock Pledges) or Section 10.12 (Additional Collateral) of the Credit
Agreement.
Section 7.2 Notices
All notices, requests and demands to or upon the
Collateral Agent or any Grantor hereunder shall be effected in the manner
provided for in Section 14.2 (Notices) of the Credit Agreement; provided,
however, that any such notice, request or demand to or upon any Grantor shall
be addressed to the Company's notice address set forth in such Section 14.2
(Notices).
Section 7.3 No Waiver by Course of Conduct; Cumulative Remedies
Neither the Collateral Agent nor any other Secured
Party shall by any act (except by a written instrument pursuant to Section 7.1
(Amendments in Writing)), delay, indulgence, omission or otherwise be deemed
to have waived any right or remedy hereunder or to have acquiesced in any
Default or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Collateral Agent or any other Secured Party,
any right, power or privilege hereunder shall operate as a waiver thereof. No
single or partial exercise of any right, power or privilege hereunder shall
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. A waiver by the Collateral Agent or any other
Secured Party of any right or remedy hereunder on any one occasion shall not
be construed as a bar to any right or remedy that the Collateral Agent or such
other Secured Party would otherwise have on any future occasion. The rights
and remedies herein provided are cumulative, may be exercised singly or
concurrently and are not exclusive of any other rights or remedies provided by
law.
Section 7.4 Successors and Assigns
This Agreement shall be binding upon the successors and
assigns of each Grantor and shall inure to the benefit of the Collateral Agent
and each other Secured Party and their successors and assigns; provided,
however, that no Grantor may assign, transfer or delegate any of its rights or
obligations under this Agreement without the prior written consent of the
Collateral Agent.
Section 7.5 Counterparts
This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
telecopy), each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Signature pages may be detached from multiple counterparts and attached to a
single counterpart so that all signature pages are attached to the same
document. Delivery of an executed counterpart by telecopy shall be effective
as delivery of a manually executed counterpart.
Section 7.6 Severability
Any provision of this Agreement that 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.
Section 7.7 Section Headings
The Article and Section titles contained in this
Agreement are, and shall be, without substantive meaning or content of any
kind whatsoever and are not part of the agreement of the parties hereto.
Section 7.8 Entire Agreement
This Agreement together with the other Loan Documents
represents the entire agreement of the parties and supersedes all prior
agreements and understandings relating to the subject matter hereof.
Section 7.9 Governing Law
This Agreement and the rights and obligations of the
parties hereto shall be governed by, and construed and interpreted in
accordance with, the law of the State of New York.
Section 7.10 Additional Grantors
If, pursuant to Section 10.10 (Additional Guaranties) of the
Credit Agreement, the Company shall be required to cause any Subsidiary that
is not a Grantor to become a Grantor hereunder, such Subsidiary shall execute
and deliver to the Collateral Agent a Joinder Agreement substantially in the
form of Annex 4 (Form of Joinder Agreement) and shall thereafter for all
purposes be a party hereto and have the same rights, benefits and obligations
as a Grantor party hereto on the Closing Date.
Section 7.11 Release of Collateral
(a) At the time provided in Section 9.1(a) of the
Intercreditor Agreement, the Collateral shall be released from the Liens
created hereby and this Agreement and all obligations (other than those
expressly stated to survive such termination) of the Collateral Agent and each
Grantor hereunder shall terminate, all without delivery of any instrument or
performance of any act by any party, and all rights to the Collateral shall
revert to the Grantors. At the request and sole expense of any Grantor
following any such termination, the Collateral Agent shall deliver to such
Grantor any Collateral of such Grantor held by the Collateral Agent hereunder
and execute and deliver to such Grantor such documents as such Grantor shall
reasonably request to evidence such termination.
(b) If the Collateral Agent shall be directed or
permitted pursuant to Section 9.1 of the Intercreditor Agreement to release
any Lien created hereby upon any Collateral (including any Collateral sold or
disposed of by any Grantor in a transaction permitted by the Credit
Agreement), such Collateral shall be released from the Lien created hereby to
the extent provided under, and subject to the terms and conditions set forth
in, Section 9.1 of the Intercreditor Agreement (and, upon such release, shall
no longer constitute "Collateral" under the Loan Documents). In connection
therewith, the Collateral Agent, at the request and sole expense of the
Company, shall execute and deliver to the Company all releases or other
documents, including, without limitation, UCC termination statements,
reasonably necessary or desirable for the release of the Lien created hereby
on such Collateral. At the request and sole expense of the Company, a Grantor
(and its Subsidiaries) shall be released from its obligations hereunder and
the Lien granted by such Grantor (and its Subsidiaries) on the Collateral
pursuant to this Agreement shall be released in the event that all the capital
stock of such Grantor shall be sold or disposed to the extent permitted by the
Credit Agreement; provided, however, that the Company shall have delivered to
the Collateral Agent, at least ten Business Days (or such shorter period
reasonably acceptable to the Collateral Agent) prior to the date of the
proposed release, a written request for release identifying the relevant
Grantor and the terms of the sale or other disposition in reasonable detail,
including the price thereof and any expenses in connection therewith, together
with a certification by the Company in form and substance reasonably
satisfactory to the Collateral Agent stating that such transaction is in
compliance with the Credit Agreement and the other Loan Documents.
Section 7.12 Reinstatement
Each Grantor further agrees that, if any payment made
by any Loan Party or other Person and applied to the Payment Obligations is at
any time annulled, avoided, set aside, rescinded, invalidated, declared to be
fraudulent or preferential or otherwise required to be refunded or repaid, or
the proceeds of Collateral are required to be returned by any Secured Party to
such Loan Party, its estate, trustee, receiver or any other party, including
any Grantor, under any bankruptcy law, state or federal law, common law or
equitable cause, then, to the extent of such payment or repayment, any Lien or
other Collateral securing such liability shall be and remain in full force and
effect, as fully as if such payment had never been made or, if prior thereto
the Lien granted hereby or other Collateral securing such liability hereunder
shall have been released or terminated by virtue of such cancellation or
surrender), such Lien or other Collateral shall be reinstated in full force
and effect, and such prior cancellation or surrender shall not diminish,
release, discharge, impair or otherwise affect any Lien or other Collateral
securing the obligations of any Grantor in respect of the amount of such
payment.
SIGNATURE PAGES FOLLOW
IN WITNESS WHEREOF, each of the undersigned has caused this
Pledge and Security Agreement to be duly executed and delivered as of the date
first above written.
REVLON CONSUMER PRODUCTS CORPORATION,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President, Assistant
General Counsel and
Assistant Secretary
REVLON, INC.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President, Assistant
General Counsel and
Assistant Secretary
ALMAY, INC.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
CHARLES of the Ritz Group Ltd.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
CHARLES REVSON INC.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
COSMETICS & MORE INC.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
NORTH AMERICAN REVSALE INC.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and Secretary
PPI TWO CORPORATION,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
REVLON CONSUMER CORP.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
REVLON DEVELOPMENT CORP.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
REVLON GOVERNMENT SALES, INC.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
REVLON INTERNATIONAL CORPORATION,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
REVLON PRODUCTS CORP.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
REVLON REAL ESTATE CORPORATION,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
RIROS CORPORATION,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
RIROS GROUP INC.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
RIT INC.,
as Grantor
By: /s/ Michael T. Sheehan
____________________________________________
Name: Michael T. Sheehan
Title: Vice President and
Assistant Secretary
ACCEPTED AND AGREED
as of the date first above written:
CITICORP USA, INC.,
as Collateral Agent
By: /s/ James J. McCarthy
_________________________________
Name: James J. McCarthy
Title: Vice President/Director
Signature Page to Pledge and Security Agreement
for Revlon Consumer Products Corporation's Credit Agreement
ANNEX 1
TO
PLEDGE AND SECURITY AGREEMENT
FORM OF DEPOSIT ACCOUNT CONTROL AGREEMENT
See Attached.
ANNEX 2
TO
PLEDGE AND SECURITY AGREEMENT
FORM OF SECURITIES ACCOUNT CONTROL AGREEMENT
See Attached.
ANNEX 3
TO
PLEDGE AND SECURITY AGREEMENT
FORM OF PLEDGE AMENDMENT
This PLEDGE AMENDMENT, dated as of __________ __, 20__, is
delivered pursuant to Section 4.4(a) (Pledged Collateral) of the Pledge and
Security Agreement, dated as of July 9, 2004, by REVLON CONSUMER PRODUCTS
CORPORATION (the "Company"), the undersigned Grantor and the other
Subsidiaries of the Company from time to time party thereto as Grantors in
favor of Citicorp USA, Inc., as collateral agent for itself and the other
Secured Parties referred to therein (the "Pledge and Security Agreement") and
the undersigned hereby agrees that this Pledge Amendment may be attached to
the Pledge and Security Agreement and that the Pledged Collateral listed on
this Pledge Amendment shall be and become part of the Collateral referred to
in the Pledge and Security Agreement and shall secure all Secured Obligations
of the undersigned. Capitalized terms used herein but not defined herein are
used herein with the meaning given them in the Pledge and Security Agreement.
GRANTOR
By:
-------------------------------------
Name:
Title:
Pledged Stock
NUMBER OF
SHARES,
UNITS OR
ISSUER CLASS CERTIFICATE NO(S). PAR VALUE INTERESTS
- --------------------------------------------------------------------------------
Pledged Debt Instruments
PRINCIPAL
ISSUER DESCRIPTION OF DEBT CERTIFICATE NO(S). FINAL MATURITY AMOUNT
- --------------------------------------------------------------------------------
ACKNOWLEDGED AND AGREED as of the date first above written:
CITICORP USA, INC.,
as Collateral Agent
By:
------------------------------
Name:
Title:
ANNEX 4
TO
PLEDGE AND SECURITY AGREEMENT
FORM OF JOINDER AGREEMENT
This JOINDER AGREEMENT, dated as of _________ __, 20__, is
delivered pursuant to Section 7.10 (Additional Grantors) of the Pledge and
Security Agreement, dated as of July 9, 2004, by REVLON CONSUMER PRODUCTS
CORPORATION (the "Company") and the Subsidiaries of the Company listed on the
signature pages thereof in favor of the Citicorp USA, Inc., as collateral
agent for the Secured Parties referred to therein (the "Pledge and Security
Agreement"). Capitalized terms used herein but not defined herein are used
with the meanings given them in the Pledge and Security Agreement.
By executing and delivering this Joinder Agreement, the
undersigned, as provided in Section 7.10 (Additional Grantors) of the Pledge
and Security Agreement, hereby becomes a party to the Pledge and Security
Agreement as a Grantor thereunder (and expressly assumes all obligations and
liabilities of a Grantor thereunder) with the same force and effect as if
originally named as a Grantor therein and, without limiting the generality of
the foregoing, hereby grants to the Collateral Agent the following security
interests:
(a) as collateral security for the full, prompt and complete
payment and performance when due (whether at stated maturity, by acceleration
or otherwise) of the Multi-Currency Secured Obligations of the undersigned,
the undersigned hereby mortgages, pledges and hypothecates to the Collateral
Agent for the benefit of the Multi-Currency Secured Parties, and grants to the
Collateral Agent for the benefit of the Multi-Currency Secured Parties a lien
on and security interest in, all of its right, title and interest in, to and
under the Multi-Currency Collateral of the undersigned;
(b) as collateral security for the full, prompt and complete
payment and performance when due (whether at stated maturity, by acceleration
or otherwise) of the Term Loan Secured Obligations of the undersigned, the
undersigned hereby mortgages, pledges and hypothecates to the Collateral Agent
for the benefit of the Term Loan Secured Parties, and grants to the Collateral
Agent for the benefit of the Term Loan Secured Parties a lien on and security
interest in, all of its right, title and interest in, to and under the
Multi-Currency Collateral of the undersigned;
(c) as collateral security for the full, prompt and complete
payment and performance when due (whether at stated maturity, by acceleration
or otherwise) of the Term Loan Claims of the undersigned, the undersigned
hereby mortgages, pledges, and hypothecates to the Collateral Agent for the
benefit of the Term Loan Secured Parties, and grants to the Collateral Agent
for the benefit of the Term Loan Secured Parties a lien on and security
interest in, all of its right, title and interest in, to and under the Term
Loan Collateral of the undersigned; and
(d) as collateral security for the full, prompt and complete
payment and performance when due (whether at stated maturity, by acceleration
or otherwise) of the Multi-Currency Secured Obligations of the undersigned,
the undersigned hereby mortgages, pledges, hypothecates and grants to the
Collateral Agent for the benefit of the Multi-Currency Secured Parties a lien
on and security interest in, all of its right, title and interest in, to and
under the Term Loan Collateral of the undersigned.
The information set forth in Annex 1-A is hereby added to
the information set forth in Schedules 1 through 6 to the Pledge and Security
Agreement. By acknowledging and agreeing to this Joinder Agreement, the
undersigned hereby agree that this Joinder Agreement may be attached to the
Pledge and Security Agreement and that the Pledged Collateral listed on Annex
1-A to this Pledge Amendment shall be and become part of the Collateral
referred to in the Pledge and Security Agreement and shall secure all Secured
Obligations of the undersigned.(1)
The undersigned hereby represents and warrants that each of
the representations and warranties contained in Article III (Representations
and Warranties) of the Pledge and Security Agreement applicable to it is true
and correct on and as the date hereof as if made on and as of such date.
IN WITNESS WHEREOF, the undersigned has caused this Joinder
Agreement to be duly executed and delivered as of the date first above
written.
ADDITIONAL GRANTOR
By:
-------------------------------
Name:
Title:
- -----------
(1) Insert to pledge Stock of the new Subsidiary without doing a Pledge
Amendment.
ACKNOWLEDGED AND AGREED as of the date first above written:
EACH GRANTOR PLEDGING
ADDITIONAL COLLATERAL
By:
------------------------------
Name:
Title:
CITICORP USA, INC.,
as Collateral Agent
By:
------------------------------
Name:
Title:
ANNEX 5
TO
PLEDGE AND SECURITY AGREEMENT
FORM OF SHORT FORM INTELLECTUAL PROPERTY SECURITY AGREEMENT(2)
- ------------
(2) Separate short form agreements should be filed relating to each
Grantor's respective copyrights, patents and trademarks.
COPYRIGHT PATENT TRADEMARK SECURITY AGREEMENT, dated as of
_________ __, 20__, by each of the entities listed on the signature pages
hereof or that becomes a party hereto pursuant to Section 7.10 (Additional
Grantors) of the Security Agreement referred to below (each a "Grantor" and,
collectively, the "Grantors"), in favor of Citicorp USA, Inc. ("Citicorp"), as
collateral agent for the Secured Parties (as defined in the Credit Agreement
referred to below) (in such capacity, the "Collateral Agent").
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, dated as of July
9, 2004 (as the same may be amended, restated, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among REVLON CONSUMER
PRODUCTS CORPORATION (the "Company"), certain of its subsidiaries, as Local
Borrowing Subsidiaries, the Lenders and Issuing Lenders party thereto and
Citicorp, as administrative agent for the Multi-Currency Lenders and Issuing
Lenders, Citicorp, as administrative agent for the Term Loan Lenders, and the
Collateral Agent, the Lenders and the Issuing Lenders have severally agreed to
make extensions of credit to the Company upon the terms and subject to the
conditions set forth therein;
WHEREAS, the Grantors other than the Company are party to
the Guaranty pursuant to which they have guaranteed the Payment Obligations;
and
WHEREAS, all the Grantors are party to a Pledge and Security
Agreement of even date herewith in favor of the Collateral Agent (the "Security
Agreement") pursuant to which the Grantors are required to execute and deliver
this Copyright Patent Trademark Security Agreement;
NOW, THEREFORE, in consideration of the premises and to
induce the Lenders, the Issuing Lenders and the Collateral Agent to enter into
the Credit Agreement and to induce the Lenders and the Issuing Lenders to make
their respective extensions of credit to the Company thereunder, each Grantor
hereby agrees with the Collateral Agent as follows:
Section 2. Defined Terms
Unless otherwise defined herein, terms defined in the Credit
Agreement or in the Security Agreement and used herein have the meaning given
to them in the Credit Agreement or the Security Agreement.
Section 3. Grant of Security Interest in Copyright Trademark Patent
Collateral
Each Grantor, as collateral security for the full, prompt
and complete payment and performance when due (whether at stated maturity, by
acceleration or otherwise) of the Secured Obligations of such Grantor, hereby
mortgages, pledges and hypothecates to the Collateral Agent for the benefit of
the Secured Parties, and grants to the Collateral Agent for the benefit of the
Secured Parties a lien on and security interest in, all of its right, title
and interest in, to and under the following Collateral of such Grantor (the
"Copyright Patent Trademark Collateral"):
(a) all of its Copyrights and Copyright Licenses to which it is a party,
including, without limitation, those referred to on Schedule I hereto;
(b) all extensions of the foregoing; and
(c) all Proceeds of the foregoing, including, without limitation, any claim by
Grantor against third parties for past, present, or future infringement of any
Copyright or Copyright licensed under any Copyright License.
or
(a) all of its Patents and Patent Licenses to which it is a party,
including, without limitation, those referred to on Schedule I hereto;
(b) all reissues, continuations or continuations-in-part of the foregoing; and
(c) all Proceeds of the foregoing, including, without limitation, any claim by
Grantor against third parties for past, present or future infringement of any
Patent or any Patent licensed under any Patent License.
or
(a) all of its Trademarks and Trademark Licenses to which it is a party,
including, without limitation, those referred to on Schedule I hereto;
(b) all goodwill of the business connected with the use of, and symbolized by,
each Trademark; and
(c) all Proceeds of the foregoing, including, without limitation, any claim by
Grantor against third parties for past, present, future (i) infringement or
dilution of any Trademark or Trademark licensed under any Trademark License or
(ii) injury to the goodwill associated with any Trademark or any Trademark
licensed under any Trademark License.
Section 4. Security Agreement
The security interests granted pursuant to this Copyright
Patent Trademark Security Agreement is granted in conjunction with the
security interest granted to the Collateral Agent pursuant to the Security
Agreement and each Grantor hereby acknowledges and affirms that the rights and
remedies of the Collateral Agent with respect to the security interest in the
Copyright Patent Trademark Collateral made and granted hereby are more
fully set forth in the Security Agreement, the terms and provisions of which
are incorporated by reference herein as if fully set forth herein.
SIGNATURE PAGES FOLLOW
IN WITNESS WHEREOF, each Grantor has caused this Copyright
Patent Trademark Security Agreement to be executed and delivered by its
duly authorized offer as of the date first set forth above.
Very truly yours,
GRANTOR,
as Grantor
By:
---------------------------------------
Name:
Title:
ACCEPTED AND AGREED as of the date first above written:
CITICORP USA, INC.,
as Collateral Agent
By:
-------------------------------
Name:
Title:
Signature Page to Copyright Patent Trademark Security Agreement
ACKNOWLEDGMENT OF GRANTOR
STATE OF )
----------------------
) ss.
COUNTY OF )
---------------------
On this ___ day of ________ __, 20__ before me personally
appeared ______________________, proved to me on the basis of satisfactory
evidence to be the person who executed the foregoing instrument on behalf of
________________, who being by me duly sworn did depose and say that he is an
authorized officer of said corporation, that the said instrument was signed on
behalf of said corporation as authorized by its Board of Directors and that he
acknowledged said instrument to be the free act and deed of said corporation.
----------------------------
Notary Public
Acknowledgement of Grantor for Copyright Patent
Trademark Security Agreement
SCHEDULE I
TO
COPYRIGHT PATENT TRADEMARK SECURITY AGREEMENT
Copyright Patent Trademark Registrations
A. REGISTERED COPYRIGHTS
Include Copyright Registration Number and Date
B. COPYRIGHT APPLICATIONS
C. COPYRIGHT LICENSES
A. REGISTERED PATENTS
B. PATENT APPLICATIONS
C. PATENT LICENSES
A. REGISTERED TRADEMARKS
B. TRADEMARK APPLICATIONS
C. TRADEMARK LICENSES
Include complete legal description of agreement
(name of agreement, parties and date)
TABLE OF CONTENTS
Page
----
ARTICLE I DEFINED TERMS.........................................................................1
Section 1.1 Definitions..................................................................1
Section 1.2 Certain Other Terms..........................................................6
ARTICLE II GRANT OF SECURITY INTEREST............................................................7
Section 2.1 Collateral...................................................................7
Section 2.2 Grant of Security Interest in Collateral.....................................8
Section 2.3 Cash Collateral Accounts.....................................................8
ARTICLE III REPRESENTATIONS AND WARRANTIES........................................................8
Section 3.1 Title; No Other Liens........................................................8
Section 3.2 Perfection and Priority......................................................8
Section 3.3 Jurisdiction of Organization; Chief Executive Office.........................9
Section 3.4 Inventory and Equipment......................................................9
Section 3.5 Pledged Collateral...........................................................9
Section 3.6 Accounts....................................................................10
Section 3.7 Intellectual Property.......................................................10
Section 3.8 Deposit Accounts; Securities Accounts.......................................11
Section 3.9 Commercial Tort Claims......................................................11
ARTICLE IV COVENANTS............................................................................11
Section 4.1 Generally...................................................................11
Section 4.2 Maintenance of Perfected Security Interest; Further Documentation...........11
Section 4.3 Changes in Locations, Name, Etc.............................................12
Section 4.4 Pledged Collateral..........................................................12
Section 4.5 Accounts....................................................................14
Section 4.6 Delivery of Instruments and Chattel Paper...................................14
Section 4.7 Intellectual Property.......................................................15
Section 4.8 Vehicles....................................................................16
Section 4.9 Payment of Payment Obligations..............................................17
Section 4.10 Insurance...................................................................17
Section 4.11 Notice of Commercial Tort Claims............................................17
ARTICLE V REMEDIAL PROVISIONS..................................................................18
Section 5.1 Code and Other Remedies.....................................................18
Section 5.2 Accounts and Payments in Respect of General Intangibles.....................18
Section 5.3 Pledged Collateral..........................................................19
Section 5.4 Proceeds to be Turned Over To Collateral Agent..............................20
Section 5.5 Registration Rights.........................................................21
Section 5.6 Deficiency..................................................................22
ARTICLE VI THE COLLATERAL AGENT.................................................................22
Section 6.1 Collateral Agent's Appointment as Attorney-in-Fact..........................22
Section 6.2 Duty of Collateral Agent....................................................23
Section 6.3 Authorization of Financing Statements.......................................24
Section 6.4 Authority of Collateral Agent...............................................24
ARTICLE VII MISCELLANEOUS........................................................................24
Section 7.1 Amendments in Writing.......................................................24
Section 7.2 Notices.....................................................................25
Section 7.3 No Waiver by Course of Conduct; Cumulative Remedies.........................25
Section 7.4 Successors and Assigns......................................................25
Section 7.5 Counterparts................................................................25
Section 7.6 Severability................................................................25
Section 7.7 Section Headings............................................................26
Section 7.8 Entire Agreement............................................................26
Section 7.9 Governing Law...............................................................26
Section 7.10 Additional Grantors.........................................................26
Section 7.11 Release of Collateral.......................................................26
Section 7.12 Reinstatement...............................................................27
ANNEXES AND SCHEDULES
Annex 1 Form of Deposit Account Control Agreement
Annex 2 Form of Securities Account Control Agreement
Annex 3 Form of Pledge Amendment
Annex 4 Form of Joinder Agreement
Annex 5 Form of Short Form Intellectual Property Security Agreement
Schedule 1 Jurisdiction of Organization; Principal Executive Office
Schedule 2 Pledged Collateral
Schedule 3 Filings
Schedule 4 Location of Inventory and Equipment
Schedule 5A Intellectual Property
Schedule 5B Material Intellectual Property
Schedule 6 Bank Accounts; Control Accounts
Schedule 7 Commercial Tort Claims
Schedule 8 Excluded Trademarks