Exhibit 10.5
AMENDED AND RESTATED CANADIAN SECURITY AGREEMENT
dated as of October 14, 2011
among
UNITED RENTALS (NORTH AMERICA), INC.; UNITED RENTALS, INC.; UNITED
RENTALS NORTHWEST, INC.; UNITED RENTALS (DELAWARE) INC.; UNITED
RENTALS HIGHWAY TECHNOLOGIES GULF, LLC; UNITED RENTALS OF CANADA,
INC.; UNITED RENTALS FINANCING LIMITED PARTNERSHIP; UNITED RENTALS OF
NOVA SCOTIA (NO.1); UNITED RENTALS OF NOVA SCOTIA (NO.2), ULC; and UR
CANADIAN FINANCING PARTNERSHIP,
as the Grantors,
and
BANK OF AMERICA, N.A.,
as Agent

 

 

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Table of Contents

              Page  
SECTION 1. Defined Terms
    2  
SECTION 2. Grant of Lien
    2  
SECTION 3. Perfection and Protection of Security Interest
    5  
SECTION 4. Location of Collateral
    8  
SECTION 5. Jurisdiction of Organization
    8  
SECTION 6. Title to, Liens on, and Sale and Use of Collateral
    8  
SECTION 7. Access and Examination
    8  
SECTION 8. Accounts
    9  
SECTION 9. Inventory; Perpetual Inventory
    9  
SECTION 10. Documents, Instruments and Letter of Credit Rights
    9  
SECTION 11. Leases and Other Chattel Paper
    9  
SECTION 12. Right to Cure
    10  
SECTION 13. Power of Attorney
    10  
SECTION 14. The Agent’s and the Other Secured Parties’ Rights, Duties and
Liabilities
    11  
SECTION 15. Patent, Trademark and Copyright Collateral
    12  
SECTION 16. Indemnification
    14  
SECTION 17. Limitation on Liens on Collateral
    14  
SECTION 18. [Reserved]
    14  
SECTION 19. Remedies; Rights Upon Default
    14  
SECTION 20. Grant of License to Use Proprietary Rights
    16  
SECTION 21. Limitation on the Agent’s and the Other Secured Parties’ Duty in
Respect of Collateral
    17  
SECTION 22. Miscellaneous
    17  

 

 

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              Page  
SECTION 23. Release
    21  
SECTION 24. Amendment and Restatement
    21  
SECTION 1. Grant of Lien
    1  
 
       
Schedules
       
 
       
Schedule I — Jurisdictions of Organization
       
Schedule II — Patents, Trademarks and Copyrights
       
 
       
Exhibits
       
 
       
Exhibit A — Security Agreement Supplement
       

 

 

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AMENDED AND RESTATED CANADIAN SECURITY AGREEMENT
This Amended and Restated Canadian Security Agreement (as amended, restated,
amended and restated, supplemented or otherwise modified from time to time, this
“Agreement”), is dated as of October  14, 2011, among UNITED RENTALS (NORTH
AMERICA), INC., a Delaware corporation, and each other U.S. Borrower (as such
term is defined in the Credit Agreement referred to below) (collectively, the
“U.S. Borrowers”); UNITED RENTALS, INC., a Delaware corporation, and each other
U.S. Guarantor (as such term is defined Credit Agreement referred to below)
including UNITED RENTALS NORTHWEST, INC., an Oregon Corporation (“UR (NW)”),
UNITED RENTALS (DELAWARE) INC., a Delaware corporation (“UR (DE)”), and UNITED
RENTALS HIGHWAY TECHNOLOGIES GULF, LLC, a Delaware limited liability company
(“UR LLC”), (collectively, the “U.S. Guarantors”); UNITED RENTALS OF CANADA,
INC., a company amalgamated under the laws of the Province of Ontario (“Canadian
Borrower”); UNITED RENTALS FINANCING LIMITED PARTNERSHIP, a limited partnership
organized pursuant to the laws of Delaware (the “Specified Loan Borrower”);
UNITED RENTALS OF NOVA SCOTIA (NO.1), ULC, a Nova Scotia unlimited liability
company (“NSULC 1”), UNITED RENTALS OF NOVA SCOTIA (NO.2), ULC, a Nova Scotia
unlimited liability company (“NSULC 2”); and UR CANADIAN FINANCING PARTNERSHIP,
a partnership organized pursuant to the laws of Nova Scotia (“UR Financing
Partnership” and together with NSULC 1 and NSULC 2 the “Canadian Guarantors”),
and such other signatories hereto (each of the foregoing a “Grantor” and
collectively the “Grantors”) and BANK OF AMERICA, N.A., as Agent (the “Agent”).
W I T N E S S E T H :
WHEREAS, United Rentals, Inc., United Rentals (North America), Inc., certain of
their Subsidiaries, the Agent and the lenders party thereto are party to a
credit agreement dated as of June 9, 2008 (as amended, restated, amended and
restated, supplemented or otherwise modified prior to the date hereof, the
“Existing Credit Agreement”);
WHEREAS, as of the date hereof, the Existing Credit Agreement is being amended
and restated, without constituting a novation, pursuant to an amended and
restated Credit Agreement dated as of the date hereof (as amended, restated,
amended and restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), among, amongst others, the U.S. Borrowers, the U.S.
Guarantors, the Canadian Borrower, the Specified Loan Borrower, the Canadian
Guarantors, Bank of America, N.A., as Agent, and the lenders party thereto;
WHEREAS, in connection with the Existing Credit Agreement, each Grantor (and
certain other grantors party thereto) entered into a Canadian Security
Agreement, dated as of June 9, 2008 (as amended, restated, extended,
supplemented or otherwise modified in writing prior to the date hereof, the
“Existing Security Agreement”);
WHEREAS, in order to induce the Agent and the Lenders to amend and restate the
existing Credit Agreement by entering into the Credit Agreement and the other
Loan Documents and to induce the Lenders to maintain and make loans and issue
letters of credit as provided for in the Credit Agreement, the Grantors enter
into this Agreement in favour of the Agent, and pursuant hereto agree to grant
to the Agent, for the benefit of the Secured Parties, a security interest in and
lien upon the Collateral (as defined below) to secure their respective
Obligations (as defined in the Credit Agreement);

 

 

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WHEREAS, the Canadian Borrower is a borrower and has obligations to, amongst
others, the Agent pursuant to the terms of the Credit Agreement;
WHEREAS, in connection with the entering into the Credit Agreement, the
Specified Loan Borrower, the Canadian Guarantors, the U.S. Borrowers, U.S.
Guarantors, have entered into an amended and restated guarantee agreement (the
“Canadian Borrower Guarantee”) dated of equal date herewith in favour of the
Agent, whereby they each, jointly and severally agree to unconditionally
guarantee and promise to pay to the Agent, or order to be paid, on demand, any
and all Obligations of the Canadian Borrower and its successors and assigns;
WHEREAS, NSULC 1 and NSULC 2 have entered into an amended and restated guarantee
agreement (the “US Borrower Guarantee”) dated of equal date herewith in favour
of the Agent, whereby they each, jointly and severally, agree to unconditionally
guarantee and promise to pay to the Agent, or order to be paid, on demand, any
and all Obligations of the U.S. Obligors;
WHEREAS the obligations of the Grantors pursuant to the Canadian Borrower
Guarantee, and the U.S. Borrower Guarantee (collectively the “Guarantees”) form
part of the Obligations of the Grantors pursuant to the terms of the Credit
Agreement;
WHEREAS, in consideration for, among other things, the amendment and restatement
of the Existing Credit Agreement by the execution and delivery of the Credit
Agreement by the Agent and the Lenders, and to secure the full and prompt
payment and performance of all of their respective Obligations, each Grantor
agrees to grant to the Agent, for the benefit of the Secured Parties, a security
interest in the Collateral, in order to ensure and secure the prompt payment and
performance of their respective Obligations.
NOW, THEREFORE, in consideration of the promises and mutual covenants set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree that the
Existing Security Agreement shall be amended and restated as follows:
SECTION 1. Defined Terms. All capitalized terms used but not otherwise defined
herein have the meanings given to them in the Credit Agreement. All other
undefined terms contained in this Agreement, unless the context indicates
otherwise, have the meanings provided for by the Personal Property Security Act
(Ontario) as in effect from time to time in the applicable jurisdiction (the
“PPSA”) to the extent the same are used or defined therein.
SECTION 2. Grant of Lien. (a) As security for the due and prompt payment and
performance when due (whether at the stated maturity, by acceleration or
otherwise), as the case may be, by the Grantors of their respective Obligations,
each Grantor hereby grants, to the Agent, its successors and assigns, for the
ratable benefit of the applicable Secured Parties, a security interest (the
“Security Interest”) in and continuing lien upon and right of set-off against,
all personal property, assets and undertakings of such Grantor, including,
without limitation, all of such Grantor’s right, title and interest in or to any
and all of the following properties and assets of such Grantor and powers and
rights of such Grantor in all of the following (including the power to transfer
rights in the following), whether now owned or existing or at any time hereafter
acquired or arising, regardless of where located (collectively, the
“Collateral”):

 

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(i) all Accounts, including all debts, book debts, accounts, claims, demands,
moneys and choses in action whatsoever including, without limitation, claims
against the Crown and claims under insurance policies, which are now owned by or
are due, owing or accruing due to the Grantor or which may hereafter be owned by
or become due, owing or accruing due to the Grantor together with all contracts,
investment property, bills, notes, lien notes, judgments, chattel mortgages,
mortgages and all other rights, benefits and documents now or hereafter taken,
vested in or held by the Grantor in respect of or as security for the same and
the full benefit and advantage thereof, and all rights of action or claims which
the Grantor now has or may at any time hereafter have against any Person in
respect thereof;
(ii) all Inventory, including, without limitation, all Rental Equipment, goods,
merchandise, raw materials, goods in process, finished goods, packaging and
packing material and other tangible personal property now or hereafter held for
sale, lease, rental or resale or that are to be furnished or have been furnished
under a contract of service or that are to be used or consumed in the business
of the Grantor;
(iii) all leases of Goods (whether or not in the form of a lease agreement),
including all Leases;
(iv) all documentation evidencing rights in any Inventory or Equipment,
including all certificates, Certificates of Title, Manufacturer’s Statements of
Origin, and other Collateral Instruments (as such terms are defined in the UCC);
(v) all contract rights, including contract rights in respect of any Like-Kind
Exchange;
(vi) all Chattel Paper;
(vii) all Documents;
(viii) all Instruments;
(ix) all Supporting Obligations and Letter-of-Credit Rights (as such terms are
defined in the UCC);
(x) all General Intangibles including Payment Intangibles (as such term is
defined in the UCC) and Software;
(xi) all Goods (excluding “Consumer Goods” as such term is defined in the PPSA);
(xii) all Equipment;
(xiii) all Investment Property;

 

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(xiv) all money, cash, cash equivalents, securities and other property of any
kind of such Grantor held directly or indirectly by the Agent, any Lender or any
of their Affiliates;
(xv) all of such Grantor’s Material Accounts, credits, and balances with and
other claims against the Agent or any Lender or any of their Affiliates or any
other financial institution with which such Grantor maintains deposits,
including all Payment Accounts;
(xvi) all books, records and other property related to or referring to any of
the foregoing, including books, records, account ledgers, data processing
records, computer software and other property;
(xvii) the uncalled capital, money, rights, bills of exchange, negotiable and
non negotiable instruments, judgments and securities not otherwise described in
the foregoing; and
(xviii) all accessions to, substitutions for and replacements, products and
proceeds derived directly or indirectly of any of the foregoing, including, but
not limited to, proceeds of any insurance policies, claims against third
parties, and condemnation or requisition payments with respect to all or any of
the foregoing;
provided, however, the Collateral shall not include:
(i) any rights or interests of a Grantor in any contract if, under the terms of
such contract or any Requirement of Law with respect thereto, the valid grant of
a security interest or other Lien therein to the Agent is prohibited and such
prohibition has not been or is not waived or the consent of the other party to
such contract has not been or is not otherwise obtained or under Requirements of
Law such prohibition cannot be waived, provided that the foregoing exclusion
shall in no way be construed (i) to apply if any such prohibition is ineffective
or unenforceable under the UCC (including Sections 9 406, 9 407, 9 408 or 9
409), the PPSA, or any other requirement of applicable law or (ii) so as to
limit, impair or otherwise affects the Agent’s unconditional continuing security
interest in and Lien upon any rights or interests of Grantors in or to monies
due or to become due under any such contract (including any Accounts) or
(iii) the prohibition against the valid grant of a security interest is a
restriction on the contract or a Requirement of Law the Grantor shall hold its
interest in trust for the Agent, provided that, until the security interest
created hereby has become enforceable, the Grantor shall be entitled to all
proceeds arising under or in connection therewith;
(ii) any property that is subject to a lien securing purchase money or
sale/leaseback Debt permitted under the Credit Agreement pursuant to documents
that prohibit such Grantor from granting any other Liens in such property, and
such prohibition has not been or is not waived or the consent of the other party
to such contract has not been or is not otherwise obtained or under Requirements
of Law such prohibition cannot be waived, and only for so long as such Debt
remains outstanding;

 

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(iii) except to the extent specifically provided herein, (i) Accounts, Leases,
contractual rights or any other assets (other than Inventory or Equipment)
subject to any Qualified Receivables Transaction or (ii) Accounts, Leases,
contractual rights or any other assets subject to any Like-Kind Exchange;
(iv) the equity interests, and any certificates or instruments in respect
thereof, in United Rentals of Nova Scotia (No.1), ULC and United Rentals of Nova
Scotia (No.2), ULC or any other Nova Scotia unlimited liability company;
(v) the equity interests, and any certificates or instruments in respect
thereof, in United Rentals Industrial Services, LLC and any other joint venture
or non-wholly owned Subsidiary, the governing agreements of which prohibit the
pledge or other granting of security over equity interests in such Subsidiary
and such prohibition has not been or is not waived or the consent of the other
party to such contract has not been or is not otherwise obtained or under
Requirements of Law such prohibition cannot be waived
(vi) with respect to the U.S. Borrowers and U.S. Guarantors only, any of the
outstanding voting equity or other voting ownership interests of a Foreign
Entity (as defined below) in excess of 65% of the voting power of all classes of
equity or other ownership interests of such Foreign Entity entitled to vote,
with the intention of this exclusion being to provide the same limitation, with
respect to the US Borrowers and US Guarantors, as is set out in paragraph 2(b)
of the Security Agreement (as such term is defined in the Credit Agreement),such
that any exclusion on the U.S Borrowers and U.S. Guarantors obligations to grant
security pursuant thereto, are also exclusions on the U.S Borrowers and U.S.
Guarantors obligations to grant security pursuant to this Agreement;
As used herein “Foreign Entity” shall mean, with respect to the Grantors, any
corporation, partnership, limited liability company or other business entity
(x) which is organized under the laws of a jurisdiction other than a state of
the United States or the District of Columbia, and (y) of which securities or
other ownership interests representing more than 50% of the equity, more than
50% of the ordinary voting power, more than 50% of the general partnership
interests or more than 50% of the limited liability company membership interest
are, at the time of any determination is being made, owned directly or
indirectly in the aggregate by all such Grantors.
(b) All of the Obligations of each respective Grantor shall be secured by all of
the Collateral of such Grantor and any other property of any such Grantor that
secures any of the Obligations.
SECTION 3. Perfection and Protection of Security Interest.
(a) Except as explicitly set forth herein or in the Credit Agreement, each
Grantor shall, at its expense, perform all steps reasonably requested in writing
by the Agent at any time to perfect, maintain or protect the Agent’s Liens,
including: (i) executing and filing financing or financing change statements,
and amendments thereof, in form and substance reasonably satisfactory to the
Agent; (ii) causing Certificates of Title to be issued for all Titled Goods, the
Agent’s Lien to be noted thereon, and in each case completing all

 

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actions necessary to perfect a first-priority security interest in all such
Grantors Titled Goods in accordance with the provisions of the Loan Documents
and causing to be delivered to the Agent copies of duly recorded certificates of
title, the PPSA filings and other documents reasonably satisfactory to the Agent
(and at a minimum naming the Agent a lien holder, secured party, legal owner, or
such other capacity as appropriate in such filing); (iii) executing, delivering
and/or filing and recording in all appropriate offices of the Intellectual
Property Security Agreement (to the extent required under the Credit Agreement
or any other Loan Document to which such Grantor is a party); (iv) delivering to
the Agent warehouse receipts covering any portion of the Collateral located in
warehouses and for which warehouse receipts are issued; (v) when an Event of
Default pursuant to Sections 10.1(a), (c)(i), (e), (f), (i) and (n) of the
Credit Agreement has occurred and is continuing, at the reasonable request of
the Agent transferring Inventory to warehouses or other locations designated by
the Agent; (vi) when an Event of Default has occurred and is continuing, placing
notations on such Grantor’s books of account to disclose the Agent’s Liens;
(vii) in the case of any Collateral that is or represents any indebtedness owed
to the Grantor including any debts represented by a promissory note or other
instrument with an individual amount in excess of $5,000,000 deliver and pledge
to the Agent hereunder such note or instrument duly indorsed and accompanied by
duly executed instruments of transfer or assignment, all in form and substance
satisfactory to the Agent, and (viii) in any taking such other steps as are
deemed reasonably necessary or desirable by the Agent to maintain and protect
the Agent’s Liens and take all action necessary to ensure that the Agent has
control of Collateral consisting of investment property as such term is defined
in the STA (as defined below).
(b) Unless the Agent shall otherwise consent in writing (which consent may be
revoked at any time and from time to time), each Grantor shall deliver to the
Agent all the Collateral consisting of negotiable Documents, Chattel Paper and
Instruments, in each case, with an individual value in excess of $5,000,000 and
all certificated securities (accompanied by stock powers executed in blank), in
each case promptly after such Grantor receives the same, and shall do everything
reasonably requested by the Agent to ensure that the Agent obtains “Control” (as
such term is defined in the Securities Transfer Act, 2006, S.O. c.8, the “STA”)
of said documents and rights, but if an Event of Default has occurred and is
continuing, each Grantor agrees to deliver to the Agent all such Collateral
(regardless of value) upon the Agent’s request.
(c) Upon obtaining an interest therein (but in the case of clause (ii) below,
subject to the time period specified in Section 8.27(a) of the Credit
Agreement), unless waived by the Agent in writing (which waiver may be revoked
at any time and from time to time), each Grantor shall obtain control or blocked
account agreements, in form and substance reasonably satisfactory to the Agent,
executed and delivered by (i) each issuer of uncertificated securities with an
individual value in excess of $5,000,000, securities intermediary, and
commodities intermediary issuing or holding any financial assets or commodities
to or for such Grantor, and (ii) each depository bank at which such Grantor
maintains a Material Account.
(d) If any Grantor is or becomes the beneficiary of a letter of credit with an
individual face amount in excess of $5,000,000, such Grantor shall promptly
notify the Agent thereof and, unless otherwise consented by the Agent, enter
into a tri-party agreement with the Agent and the issuer and/or confirming bank
with respect to Letter-of-Credit Rights, whereby such Grantor assigns such
Letter-of-Credit Rights to the Agent and directs all payments thereunder to the
Payment Account, all in form and substance reasonably satisfactory to the Agent
and all “transferable records” as defined in the Uniform Electronic Transactions
Act.

 

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(e) Each Grantor shall take all commercially reasonable steps necessary to grant
the Agent control of all electronic chattel paper in accordance with the UCC,
PPSA, STA, CCQ or other applicable law.
(f) Each Grantor hereby irrevocably authorizes the Agent at any time and from
time to time to file in any PPSA, UCC, Quebec Civil Code (“CCQ”) or other
applicable filing office any initial financing statements and amendments thereto
that (a) indicate the Collateral (i) as all assets of such Grantor or words of
similar effect, regardless of whether any particular asset comprised in the
Collateral falls within the scope of Article 9 of the UCC of the State of New
York or such jurisdiction, or (ii) as being of an equal or lesser scope or with
greater detail, and (b) contain any other information required by such
jurisdiction for the sufficiency or filing office acceptance of any financing
statement or amendment, including where applicable whether such Grantor is an
organization, the type of organization and any organization identification
number issued to such Grantor. Each Grantor agrees to furnish any such
information to the Agent promptly upon request. Each Grantor also ratifies its
authorization for the Agent to have filed in any UCC, PPSA, CCQ or other
applicable filing office any like initial financing statements or amendments
thereto if filed prior to the date hereof.
(g) Each Grantor shall promptly notify the Agent of any commercial tort claim
(as defined in the UCC) involving a claim for damages in excess of $5,000,000,
initiated or acquired by it and unless otherwise consented by the Agent, such
Grantor shall enter into a supplement to this Agreement, granting to the Agent a
Lien in such commercial tort claim.
(h) So long as the Credit Agreement or any of the Guarantees are in effect and
until Full Payment of the Obligations, the Agent’s Liens shall continue in full
force and effect in all the Collateral (whether or not deemed eligible for the
purpose of calculating the Availability or as the basis for any advance, loan,
extension of credit, or other financial accommodation), provided that, the Agent
agrees to release its Lien in any Collateral that is sold or disposed of by a
Grantor as permitted pursuant to the Credit Agreement, subject to the
satisfaction of any conditions to release (if any) set forth in the Credit
Agreement, including the continuance of the Agent’s Lien in any proceeds of such
released Collateral.
(i) Without limiting the prohibitions on mergers or other transactions involving
any Grantor contained in the Credit Agreement, no Grantor shall reincorporate or
reorganize itself under the laws of any jurisdiction or change its type of
entity or jurisdiction of organization as identified in the Perfection
Certificate unless (i) such Grantor shall have provided not less than thirty
(30) days (or such shorter period as the Agent may agree) prior written notice
to the Agent of such reincorporation or reorganization, (ii) such Grantor shall
have executed and delivered to the Agent all documents, agreements and
instruments reasonably requested by the Agent in order to maintain the validity,
perfection, enforceability and priority of the Agent’s Lien in all of such
Grantor’s Collateral, and (iii) such Grantor shall have authorized the Agent to
file all such PPSA financing statements, recordations required by the CCQ,
notices with the Canadian Intellectual Property Office (or any similar office in
any other country or any political subdivision thereof) with respect to patents,
trademarks and other intellectual property Collateral, and made such other
filings or recordings as are necessary to maintain the validity, perfection,
enforceability and priority of the Agent’s Lien in all of such Grantor’s
Collateral.

 

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(j) Each Grantor acknowledges that it is not authorized to file any financing
statement or amendment or termination statement or financing change statement
with respect to any financing statement filed by the Agent without the prior
written consent of the Agent and agrees that it will not do so without the prior
written consent of the Agent.
(k) No Grantor shall enter into any contract or agreement that restricts or
prohibits the grant of a security interest in Accounts, Chattel Paper, Leases,
Instruments or Payment Intangibles (as such term is defined in the UCC) or the
proceeds of the foregoing to the Agent, except (x) for any joint venture
agreement (solely with respect to restrictions on any such assets of the joint
venture entity but in no event relating to any such assets of a Grantor) or
(y) in the case of such a contract or agreement which evidences or secures
Permitted Debt to the extent that the collateral restricted or prohibited by
such contract or agreement arises solely out of the acquisition, sale or other
disposition of such collateral thereunder.
SECTION 4. Location of Collateral. Each Grantor represents that all of its
Inventory (other than Inventory in transit) is, and covenants that all of its
Inventory will be, located either (a) on premises owned or leased by such
Grantor, (b) at a warehouse which if required by the Credit Agreement, subject
to a warehousing arrangement between such Grantor and the applicable
warehouseman, or (c) in the case of Inventory subject to a Lease, on premises
owned or leased by the lessee of such Inventory; provided that such Grantor
shall use commercially reasonable efforts to obtain a Collateral Access
Agreements from any lessor and/or mortgagee of such premises to the extent
reasonably requested by the Agent.
SECTION 5. Jurisdiction of Organization. Each Grantor represents and warrants to
the Agent and the other Secured Parties that as of the Agreement Date: (a)
Schedule I hereto identifies (i) such Grantor’s name as of the date hereof as it
appears in official filings in the state, province or other jurisdiction of its
incorporation or other organization, (ii) the type of entity of such Grantor
(including corporation, partnership, limited partnership or limited liability
company), (iii) the organizational identification number issued by such
Grantor’s state, province or territory of incorporation or organization or a
statement that no such number has been issued, and (iv) the jurisdiction in
which such Grantor is incorporated or organized; and (b) such Grantor has only
one state, province or territory of incorporation or organization.
SECTION 6. Title to, Liens on, and Sale and Use of Collateral. Each Grantor
represents and warrants to the Agent and the other Secured Parties and agrees
with the Agent and the other Secured Parties that: (a) such Grantor has rights
in and the power to transfer all of the Collateral free and clear of all Liens
whatsoever, except for Permitted Liens; and (b) such Grantor will use, store,
and maintain the Collateral with reasonable care and will use the Collateral for
lawful purposes only.
SECTION 7. Access and Examination. The Agent may, without expense to the Agent,
use such of each Grantor’s respective personnel, supplies, and Real Estate as
may be reasonably necessary for maintaining or enforcing the Agent’s Liens.
Subject to the terms of the Credit Agreement, the Agent shall have the right, at
any time, in the Agent’s name or in the name of a nominee of the Agent, to
verify the validity, amount or any other matter relating to the Accounts,
Inventory, Leases, or other Collateral, by mail, telephone, or otherwise.

 

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SECTION 8. Accounts.
(a) No Grantor shall accept any note or other instrument (except a check or
other instrument for the immediate payment of money) with respect to any Account
not subject to any Qualified Receivables Transactions unless upon such Grantor’s
receipt of any such instrument, (unless otherwise agreed by the Agent or if the
value of such single instrument does not exceed $5,000,000) such Grantor
promptly delivers such instrument to the Agent, endorsed by such Grantor to the
Agent in a manner reasonably satisfactory in form and substance to the Agent.
SECTION 9. Inventory; Perpetual Inventory. Each Grantor represents and warrants
to the Agent and the other Secured Parties and agrees with the Agent and the
other Secured Parties that all of the material Inventory owned by such Grantor
is and will be held for sale or lease in the ordinary course of such Grantor’s
business, and is and will be fit (ordinary wear and tear and casualty events
excepted) for such purposes. Each Grantor will keep its material Inventory in
good and marketable condition, except for damaged or defective goods arising in
the ordinary course of such Grantor’s business and casualty events. No Grantor
will, without the prior written consent of the Agent, acquire or accept any
Inventory on consignment or approval. No Grantor will, without the Agent’s
written consent, sell any Inventory on a bill-and-hold, guaranteed sale, sale
and return, sale on approval, consignment, or other repurchase or return basis.
SECTION 10. Documents, Instruments and Letter of Credit Rights. Each Grantor
represents and warrants to the Agent and the other Secured Parties and agrees
with the Agent and the other Secured Parties that (a) all Documents, Instruments
and Letter-of-Credit Rights (as such term in defined in the UCC) describing,
evidencing, or constituting the Collateral, in each case, with an individual
value or face value in excess of $5,000,000, and all signatures and endorsements
of any Grantor or Affiliate thereon, are and will be complete, valid, and
genuine, and (b) all goods constituting Collateral evidenced by such Documents,
Instruments and Letter-of-Credit Rights are and will be owned by such Grantor,
free and clear of all Liens other than Permitted Liens.
SECTION 11. Leases and Other Chattel Paper.
(a) Each Grantor hereby represents and warrants to the Agent and the other
Secured Parties and agrees with the Agent and the other Secured Parties, with
respect to such Grantor’s Leases, that (except, in each case, as it would not be
reasonably expected to have a Material Adverse Effect): (i) each Lease
represents a bona fide lease and delivery of goods by such Grantor in the
ordinary course of such Grantor’s business; (ii) all amounts described as being
payable by a lessee in any existing Lease are for a liquidated amount payable by
such lessee thereon on the terms set forth in such Lease, without any offset,
deduction, defense, or counterclaim except in the ordinary course of business;
(iii) each copy of a Lease delivered to the Agent by such Grantor will be a
genuine copy of the original of such Lease; and (iv) (except in the case of
Progress Billings) all goods described in any Lease that has been delivered to
the Agent shall be or will have been delivered to and accepted by the lessee
thereunder (subject to the terms of such Lease).

 

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(b) No Grantor shall accept any note or other instrument (except a check or
other instrument for the immediate payment of money) with respect to any Lease
unless upon such Grantor’s receipt of any such instrument, unless otherwise
agreed by the Agent or if such single instrument has a face value that does not
exceed $5,000,000, such Grantor promptly delivers such instrument to the Agent,
endorsed by such Grantor to the Agent in a manner reasonably satisfactory in
form and substance to the Agent.
(c) Each Grantor represents and warrants to the Agent and the other Secured
Parties that all Goods that are covered by such Leases and Chattel Paper are
owned by such Grantor, free and clear of all Liens other than Permitted Liens.
SECTION 12. Right to Cure. The Agent may, in its reasonable discretion, and
shall, at the direction of the Required Lenders, pay any amount or do any act
required of any Grantor hereunder or under any other Loan Document in order to
preserve, protect, maintain or enforce the Obligations, the Collateral or the
Agent’s Liens therein, and which any Grantor fails to pay or do following notice
by the Agent to Grantors (unless an Event of Default has occurred or is
continuing, or unless Agent has reason to believe exigent circumstances may
exist, in which events, no such notice shall be required), including payment of
any judgment against any Grantor, any insurance premium, any warehouse charge,
any finishing or processing charge, any landlord’s or bailee’s claim, and any
other Lien upon or with respect to the Collateral. All payments that the Agent
makes under this Section 12 and all documented out-of-pocket costs and expenses
that the Agent pays or incurs in connection with any action taken by it
hereunder shall be charged as a Canadian Revolving Loan, and the Agent agrees to
notify the Canadian Borrower thereof; provided that neither the Agent’s right to
make any such payments and charge the same as a Canadian Revolving Loan, nor the
Canadian Borrower’s obligation to repay any such Canadian Revolving Loan, shall
be conditioned in any way upon the Agent’s providing such notification. Any
payment made or other action taken by the Agent under this Section 12 shall be
without prejudice to any right to assert an Event of Default hereunder and to
proceed thereafter as herein provided.
SECTION 13. Power of Attorney. Each Grantor hereby appoints the Agent and the
Agent’s designee as such Grantor’s attorney, with power exercisable upon the
occurrence and during the continuance of an Event of Default: (a) to endorse
such Grantor’s name on any checks, notes, acceptances, money orders, or other
forms of payment or security that come into the Agent’s or any of the other
Secured Parties’ possession; (b) to sign such Grantor’s name on any invoice,
bill of lading, warehouse receipt or other negotiable or non-negotiable Document
constituting the Collateral, on drafts against customers, on assignments of
Accounts, on notices of assignment, financing statements and other public
records and to file any such financing statements by electronic means with or
without a signature as authorized or required by applicable law or filing
procedure; (c) to notify the post office authorities to change the address for
delivery of such Grantor’s mail to an address designated by the Agent and to
receive, open and dispose of all mail addressed to such Grantor; (d) to send
requests for verification of Accounts and Leases (other than Accounts and Leases
subject to any

 

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Qualified Receivables Transactions) to Account Debtors and lessees; (e) to
complete in such Grantor’s name or the Agent’s name, any order, sale, lease or
transaction, obtain the necessary Documents in connection therewith, and collect
the proceeds thereof; (f) to clear Inventory through customs in such Grantor’s
name, the Agent’s name or the name of the Agent’s designee, and to sign and
deliver to customs officials powers of attorney in such Grantor’s name for such
purpose; (g) to the extent that such Grantor’s authorization given in
Section 3(f) of this Agreement is not sufficient, to file such financing
statements with respect to this Agreement; and (h) to do all things necessary to
carry out the Credit Agreement, this Agreement and the other Loan Documents.
Each Grantor ratifies and approves all acts of such attorney. This power, being
coupled with an interest, is irrevocable until the Credit Agreement has been
terminated and Full Payment of the Obligations has occurred.
SECTION 14. The Agent’s and the Other Secured Parties’ Rights, Duties and
Liabilities.
(a) As between the Grantors and the Secured Parties, each Grantor assumes all
responsibility and liability arising from or relating to the use, sale, lease,
license or other disposition of the Collateral. None of the Obligations shall be
affected by any failure of the Agent or any of the other Secured Parties to take
any steps to perfect the Agent’s Liens or to collect or realize upon the
Collateral, nor shall loss of or damage to the Collateral release any Grantor
from any of the Obligations. Following the occurrence and during the
continuation of an Event of Default, the Agent may (but shall not be required
to), and at the direction of the Required Lenders shall, without notice to or
consent from any Grantor, sue upon or otherwise collect, extend the time for
payment of, modify or amend the terms of, compromise or settle for cash, credit,
or otherwise upon any terms, grant other indulgences, extensions, renewals,
compositions, or releases, and take or omit to take any other action with
respect to the Collateral, any security therefore, any agreement relating
thereto, any insurance applicable thereto, or any Person liable directly or
indirectly in connection with any of the foregoing, without discharging or
otherwise affecting the liability of Grantors for the Obligations, or any other
agreement now or hereafter existing between any of the Secured Parties and any
Grantor.
(b) It is expressly agreed by each Grantor that, anything herein to the contrary
notwithstanding, such Grantor shall remain liable under each Lease and each of
its other contracts, agreements and licenses to observe and perform all the
conditions and obligations to be observed and performed by it thereunder.
Neither the Agent nor any of the other Secured Parties shall have any obligation
or liability under any Lease, contract, agreement or license by reason of or
arising out of this Agreement or the granting herein of a Lien thereon or the
receipt by the Agent or any of the other Secured Parties of any payment relating
to any Lease, contract, agreement or license pursuant hereto. Neither the Agent
nor any of the other Secured Parties shall be required or obligated in any
manner to perform or fulfill any of the obligations of any Grantor under or
pursuant to any Lease, contract, agreement or license, or to make any payment,
or to make any inquiry as to the nature or the sufficiency of any payment
received by it or the sufficiency of any performance by any party under any
Lease, contract, agreement or license, or to present or file any claims, or to
take any action to collect or enforce any performance or the payment of any
amounts which may have been assigned to it or to which it may be entitled at any
time or times.

 

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(c) With respect to Accounts and Leases, in each case not subject to any
Qualified Receivables Transactions or Like-Kind Exchange, the Agent may, at any
time after an Event of Default shall have occurred and be continuing (or if any
rights of set-off (other than set-offs against an Account arising under the
contract giving rise to the same Account) or contra accounts may be asserted
with respect to the following), without prior notice to any Grantor, notify
Account Debtors, parties to Leases and other Persons obligated on the Collateral
that the Agent has a security interest therein, and that payments shall be made
directly to the Agent, for the benefit of the Secured Parties. Upon the request
of the Agent, each Grantor shall so notify Account Debtors and other Persons
obligated on such Collateral. Once any such notice has been given to any Account
Debtor or other Person obligated on such Collateral and while any Event of
Default exists and is continuing, no Grantor shall give any contrary
instructions to such Account Debtor or other Person without the Agent’s prior
written consent.
(d) With respect to Accounts, and Leases, in each case not subject to any
Qualified Receivables Transactions or Like-Kind Exchange, in connection with any
audit, inspection or appraisal under, and subject to the terms of, Section 8.4
of the Credit Agreement, the Agent may at any time in the Agent’s own name, or
in the name of any Grantor, communicate with Account Debtors, parties to Leases,
contracts, agreements or licenses to which such Grantor is a party, and obligors
in respect of Instruments to verify with such Persons, to the Agent’s
satisfaction, the existence, amount and terms of Accounts, Leases, contracts and
agreements, payment intangibles, Instruments or Chattel Paper. Grantors shall
deliver to the Agent, at their own expense, the results of each physical
verification, if any, which any Grantor may in its discretion have made, or
caused any other Person to have made on its behalf, of all or any portion of the
Inventory.
SECTION 15. Patent, Trademark and Copyright Collateral.
(a) Each Grantor represents and warrants to the Agent and the other Secured
Parties that (i) as of the Agreement Date, such Grantor does not have any
interest in, or title to, any material issued or applied-for patents, registered
or applied-for trademarks or registered or applied-for copyrights except as set
forth in Schedule II hereto and, (ii) this Agreement, together with the filing
of the financing statements referred to in Section 3(f) of this Agreement, the
recording of the Trademark Agreement and the Patent Agreement with the Canadian
Intellectual Property Office or any similar office in any other country or any
political subdivision thereof and subsequent filings for any hereafter acquired,
issued or applied-for patents, registered or applied-for trademarks or issued or
applied-for copyrights, are effective to create valid, perfected, first priority
(subject to Permitted Liens) and continuing Liens in favour of the Agent on such
material patents, trademarks and copyrights and such perfected Liens are
enforceable as such as against any and all creditors of such Grantor.
(b) Each Grantor shall notify the Agent promptly if it knows that any
application or registration relating to any material patent, trademark or
copyright (now or hereafter existing) owned or licensed by such Grantor will
become abandoned or dedicated, or of any material and adverse determination or
development (including the institution of, or any such determination or
development in, any proceeding in the Canadian Intellectual Property Office, any
similar office in any other country or any political subdivision thereof, or any
court) regarding such Grantor’s ownership of any material patent, trademark or
copyright, its right to register the same, or to keep and maintain the same.

 

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(c) If, before Full Payment of the Obligations and the termination of the
Lenders’ commitments to lend under the Credit Agreement, any Grantor shall
obtain ownership of any additional issued or applied-for patent, registered or
applied-for trademark or issued or applied-for copyright (except to the extent
any application for a trademark is excluded from the definition of “Collateral”
under subclause (c) of Section 2 of this Agreement), with respect to goods sold
in such Grantor’s business, the Agent shall have a Lien in, and the provisions
of Section 2 shall automatically apply to, such issued or applied-for patent,
registered or applied-for trademark or issued or applied-for copyright, and also
to any composite marks or other marks of such Grantor which are confusingly
similar to such mark, and such Grantor shall give to the Agent prompt written
notice of such ownership within thirty (30) days of the end of each six month
period or more frequently upon the request of the Agent, if an Event of Default
has occurred and is continuing) in which such Grantor obtains ownership of such
patent, trademark, or copyright. This Section 15(c) shall not apply to
trademarks which are owned by others and licensed to any Grantor.
(d) Each Grantor authorizes the Agent to modify this Agreement by amending
Schedule II to include any additional issued or applied-for patents, registered
or applied-for copyrights or registered or applied-for trademarks, and to have
this Agreement, as amended, or any other document evidencing the security
interest granted therein, recorded in the Canadian Intellectual Property Office
(or any similar office in any other country or any political subdivision
thereof) at the expense of such Grantor. The Agent shall provide notice to the
Grantors of any amendment or modification to be effected pursuant to this
Section.
(e) Upon written request of the Agent, each Grantor shall execute and deliver
any and all security agreements and other notices of the Agent’s Liens as the
Agent may reasonably request to evidence the Agent’s Lien on such patent,
trademark or copyright, and the General Intangibles of such Grantor relating
thereto or represented thereby.
(f) Each Grantor shall take all actions reasonably necessary or reasonably
requested by the Agent to maintain and pursue each application, to obtain the
relevant registration and to maintain the registration of each of the patents,
trademarks and copyrights (now or hereafter existing), including the filing of
applications for renewal, affidavits of use, affidavits of noncontestability and
opposition and interference and cancellation proceedings, unless such Grantor
shall determine that such patent, trademark or copyright is not material to the
conduct of its business.
(g) In the event that any Grantor has knowledge that any of the material patent,
trademark or copyright Collateral is infringed upon, or misappropriated or
diluted by a third party, such Grantor shall notify the Agent promptly after
such Grantor learns thereof. Each Grantor shall, unless it shall reasonably
determine that such patent, trademark or copyright Collateral is not material to
the conduct of its business or operations, promptly take commercially reasonable
actions including such actions as the Agent shall reasonably request under the
circumstances to protect such patent, trademark or copyright Collateral.

 

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SECTION 16. Indemnification. In any suit, proceeding or action brought by the
Agent or any of the other Secured Parties relating to any Collateral for any sum
owing with respect thereto or to enforce any rights or claims with respect
thereto, each Grantor jointly and severally agrees to save, indemnify and keep
the Agent and the other Secured Parties harmless from and against all expense
(including reasonable and documented attorneys’ fees and expenses), loss or
damage suffered by reason of any defense, setoff, counterclaim, recoupment or
reduction of liability whatsoever of the Account Debtor or other Person
obligated on the Collateral, arising out of a breach by any Grantor of any
obligation thereunder or arising out of any other agreement, indebtedness or
liability at any time owing to, or in favour of, such obligor or its successors
from any Grantor, except in the case of the Agent or any of the other Secured
Parties, to the extent such expense, loss, or damage is attributable to the
gross negligence, bad faith or willful misconduct of the Agent or such other
Secured Party. All such obligations of Grantors shall be and remain enforceable
against and only against Grantors and shall not be enforceable against the Agent
or any of the other Secured Parties.
SECTION 17. Limitation on Liens on Collateral. No Grantor will create, permit or
suffer to exist, and will defend the Collateral against, and take such other
action as is necessary to remove, any Lien on the Collateral except Permitted
Liens, and will defend the right, title and interest of the Agent and the other
Secured Parties in and to any of such Grantor’s rights under the Collateral
against the claims and demands (other than Permitted Liens) of all Persons
whomsoever.
SECTION 18. [Reserved].
SECTION 19. Remedies; Rights Upon Default.
(a) In addition to all other rights and remedies granted to it under this
Agreement, the Credit Agreement, the other Loan Documents and under any other
instrument or agreement securing, evidencing or relating to any of the
Obligations or pursuant to any other applicable law, if any Event of Default
shall have occurred and be continuing, the Agent may exercise all rights and
remedies of a secured party under the PPSA, UCC, CCQ and other applicable law.
Without limiting the generality of the foregoing, each Grantor expressly agrees
that, if any Event of Default shall have occurred and be continuing, the Agent,
without demand of performance or other demand, advertisement or notice of any
kind (except the notice specified below of time and place of public or private
sale) to or upon such Grantor or any other Person (all and each of which
demands, advertisements and notices are hereby expressly waived to the maximum
extent permitted by the PPSA, UCC and CCQ and other applicable law), may
forthwith enter upon the premises of such Grantor where any Collateral is
located through self-help, without judicial process, without first obtaining a
final judgment or giving such Grantor or any other Person notice and opportunity
for a hearing on the Agent’s claim or action and may collect, receive, assemble,
process, appropriate and realize upon the Collateral, or any part thereof, and
may forthwith sell, lease, license, assign, give an option or options to
purchase, or sell or otherwise dispose of and deliver said Collateral (or
contract to do so), or any part thereof, in one or more parcels at a public or
private sale or sales, at any exchange at such prices as it may deem acceptable,
for cash or on credit or for future delivery without assumption of any credit
risk. The Agent or any of the other Secured Parties shall have the right upon

 

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any such public sale or sales and, to the extent permitted by law, upon any such
private sale or sales, to purchase for the benefit of the Agent and the other
Secured Parties, the whole or any part of said Collateral so sold, free of any
right or equity of redemption, which equity of redemption each Grantor hereby
releases. Such sales may be adjourned and continued from time to time with or
without notice. The Agent shall have the right to conduct such sales on premises
of any Grantor or elsewhere and shall have the right to use any Grantor’s
premises without charge for such time or times as the Agent deems necessary or
advisable.
(b) Each Grantor further agrees, at the Agent’s request following the occurrence
and during the continuance of an Event of Default, to assemble the Collateral
and make it available to the Agent at a place or places designated by the Agent
which are reasonably convenient to the Agent and such Grantor, whether at such
Grantor’s premises or elsewhere. Until the Agent is able to effect a sale,
lease, or other disposition of the Collateral, the Agent shall have the right to
hold or use the Collateral, or any part thereof, to the extent that it deems
appropriate for the purpose of preserving the Collateral or its value or for any
other purpose deemed appropriate by the Agent. The Agent shall have no
obligation to any Grantor to maintain or preserve the rights of such Grantor as
against third parties with respect to the Collateral while the Collateral is in
the possession of the Agent. The Agent may, if it so elects, and, in addition to
any other rights it may have, appoint by instrument in writing a receiver or
receiver and manager (both of which are herein called a “Receiver”) of all or
any part of the Collateral or may institute proceedings in any court of
competent jurisdiction for the appointment of such a Receiver. Any such Receiver
is hereby given and shall have the same powers and rights and exclusions and
limitations of liability as the Secured Parties and the Agent have under this
Security Agreement, at law or in equity. In exercising any such powers, any such
Receiver shall, to the extent permitted by law, act as and for all purposes
shall be deemed to be the agent of the Grantor, and the Secured Parties and the
Agent shall not be responsible for any act or default of any such Receiver. The
Agent may appoint one or more Receivers hereunder and may remove any such
Receiver or Receivers and appoint another or others in his or their stead from
time to time. Any Receiver so appointed may be an officer or employee of the
Agent or any of the other Secured Parties. A court need not appoint, ratify the
appointment by the Agent of or otherwise supervise in any manner the actions of
any Receiver. Upon the Grantor receiving notice from the Agent of the taking of
possession of the Collateral or the appointment of a Receiver, all powers,
functions, rights and privileges of each of the directors and officers of the
Grantor with respect to the Collateral shall cease, unless specifically
continued by the written consent of the Agent. The Agent shall apply the net
proceeds of any such collection, recovery, receipt, appropriation, realization
or sale to the Obligations as provided in the Credit Agreement, and only after
so paying over such net proceeds, and after the payment by the Agent of any
other amount required by any provision of law, need the Agent account for the
surplus, if any, to the applicable Grantor. To the maximum extent permitted by
applicable law, each Grantor waives all claims, damages, and demands against the
Agent or any of the other Secured Parties arising out of the repossession,
retention or sale of the Collateral except such as arise solely out of the gross
negligence, bad faith or willful misconduct of the Agent or such Secured Party
as finally determined by a court of competent jurisdiction. Unless a greater
period of time is required by applicable law, each Grantor agrees that ten
(10) days prior notice by the Agent of the time and place of any public sale or
of the time after which a private sale may take place is reasonable notification
of such matters. Each Grantor shall remain liable, jointly and severally with
the other Grantors, for any deficiency if the proceeds of any sale or
disposition of the Collateral are insufficient to pay all Obligations, including
any attorneys’ fees or other expenses (to the extent provided for herein or in
the Credit Agreement) incurred by the Agent or any of the other Secured Parties
to collect such deficiency.

 

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(c) Except as otherwise specifically provided herein, each Grantor hereby waives
presentment, demand, protest or any notice (to the maximum extent permitted by
applicable law) of any kind in connection with this Agreement or any Collateral.
(d) To the extent that applicable law imposes duties on the Agent to exercise
remedies in a commercially reasonable manner, each Grantor acknowledges and
agrees that it is not commercially unreasonable for the Agent (a) to fail to
incur expenses reasonably deemed significant by the Agent to prepare the
Collateral for disposition or otherwise to complete raw material or work in
process into finished goods or other finished products for disposition, (b) to
fail to obtain third party consents for access to the Collateral to be disposed
of, or to obtain or, if not required by other law, to fail to obtain
governmental or third party consents for the collection or disposition of the
Collateral to be collected or disposed of, (c) to fail to exercise collection
remedies against Account Debtors or other Persons obligated on the Collateral or
to remove Liens on or any adverse claims against the Collateral, (d) to exercise
collection remedies against Account Debtors and other Persons obligated on the
Collateral directly or through the use of collection agencies and other
collection specialists, (e) to advertise dispositions of the Collateral through
publications or media of general circulation, whether or not the Collateral is
of a specialized nature, (f) to contact other Persons, whether or not in the
same business as any Grantor, for expressions of interest in acquiring all or
any portion of such Collateral, (g) to hire one or more professional auctioneers
to assist in the disposition of the Collateral, whether or not the Collateral is
of a specialized nature, (h) to dispose of the Collateral by utilizing Internet
sites that provide for the auction of assets of the types included in the
Collateral or that have the reasonable capacity of doing so, or that match
buyers and sellers of assets, (i) to dispose of assets in wholesale rather than
retail markets, (j) to disclaim disposition warranties, such as title,
possession or quiet enjoyment, (k) to purchase insurance or credit enhancements
to insure the Agent against risks of loss, collection or disposition of the
Collateral or to provide to the Agent a guaranteed return from the collection or
disposition of the Collateral, (l) to dispose of Leases, Inventory and related
Collateral in one or more portfolio sales or in individual sale transactions, or
(m) to the extent deemed appropriate by the Agent, to obtain the services of
other brokers, investment bankers, consultants and other professionals to assist
the Agent in the collection or disposition of any of the Collateral. Each
Grantor acknowledges that the purpose of this Section 19(d) is to provide
non-exhaustive indications of what actions or omissions by the Agent would not
be commercially unreasonable in the Agent’s exercise of remedies against the
Collateral and that other actions or omissions by the Agent shall not be deemed
commercially unreasonable solely on account of not being indicated in this
Section 19(d). Without limitation upon the foregoing, nothing contained in this
Section 19(d) shall be construed to grant any rights to any Grantor or to impose
any duties on the Agent that would not have been granted or imposed by this
Agreement or by applicable law in the absence of this Section 19(d).
SECTION 20. Grant of License to Use Proprietary Rights. Solely for the purpose
of enabling the Agent to exercise rights and remedies under Section 19 hereof
(including, without limiting the terms of Section 19 hereof, in order to take
possession of, hold, preserve, process, assemble, prepare for sale, market for
sale, sell or otherwise dispose of the Collateral), effective solely upon the
occurrence and during the continuance of an Event of Default and exercisable at
such time as the Agent shall be otherwise lawfully entitled to exercise such
rights and remedies, each Grantor hereby grants to the Agent, for the benefit of
the Secured Parties, an irrevocable, nonexclusive license (exercisable without
payment of royalty or other compensation to such Grantor) to use, license or
sublicense any Proprietary Rights now owned or hereafter acquired by such
Grantor, and wherever the same may be located, and including in such license
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.

 

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SECTION 21. Limitation on the Agent’s and the Other Secured Parties’ Duty in
Respect of Collateral. The Agent and each other Secured Party shall use
reasonable care with respect to the Collateral in its possession or under its
control. Except as required by applicable law, neither the Agent nor any of the
other Secured Parties shall have any other duty as to any Collateral in its
possession or control or in the possession or control of the Agent or nominee of
the Agent or such other Secured Party, or any income thereon or as to the
preservation of rights against prior parties or any other rights pertaining
thereto.
SECTION 22. Miscellaneous. Reinstatement.
(a) This Agreement shall remain in full force and effect and continue to be
effective should any petition be filed by or against any Grantor for liquidation
or reorganization, should any Grantor become insolvent or make an assignment for
the benefit of any creditor or creditors or should a receiver or trustee be
appointed for all or any significant part of such Grantor’s assets, and shall
continue to be effective or be reinstated, as the case may be, if at any time
payment and performance of the Obligations, or any part thereof, is, pursuant to
applicable law, rescinded or reduced in amount, or must otherwise be restored or
returned by any obligee of the Obligations, whether as a “voidable preference,”
“fraudulent conveyance,” or otherwise, all as though such payment or performance
had not been made. In the event that any payment, or any part thereof, is
rescinded, reduced, restored or returned, the Obligations shall be reinstated
and deemed reduced only by such amount paid and not so rescinded, reduced,
restored or returned.
(b) Notices. Except as otherwise provided herein, whenever it is provided herein
that any notice, demand, request, consent, approval, declaration or other
communication shall or may be given to or served upon any of the parties by any
other party, or whenever any of the parties desires to give and serve upon any
other party any communication with respect to this Agreement, each such notice,
demand, request, consent, approval, declaration or other communication shall be
in writing and shall be given in the manner, and deemed received, as provided
for in the Credit Agreement.
(c) Severability. Whenever possible, each provision of this Agreement shall be
interpreted in a manner as to be effective and valid under applicable law, but
if any provision of this Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity without invalidating the remainder of such provision
or the remaining provisions of this Agreement. This Agreement is to be read,
construed and applied together with the Credit Agreement and the other Loan
Documents which, taken together, set forth the complete understanding and
agreement of the Agent, the other Secured Parties and Grantors with respect to
the matters referred to herein and therein provided that, in the event of any
conflict between the terms of this Agreement and the Credit Agreement, the terms
of the Credit Agreement shall govern.

 

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(d) No Waiver; Cumulative Remedies; Amendments and Additional Grantors.
(i) Neither the Agent nor any of the other Secured Parties shall by any act,
delay, omission or otherwise be deemed to have waived any of its rights or
remedies hereunder, and no waiver shall be valid unless in writing, signed by
the Agent and then only to the extent therein set forth. A waiver by the Agent
of any right or remedy hereunder on any one occasion shall not be construed as a
bar to any right or remedy which the Agent would otherwise have had on any
future occasion. No failure to exercise nor any delay in exercising on the part
of the Agent or any of the other Secured Parties, any right, power or privilege
hereunder, shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or future
exercise thereof or the exercise of any other right, power or privilege. The
rights and remedies hereunder provided are cumulative and may be exercised
singly or concurrently, and are not exclusive of any rights and remedies
provided by law.
(ii) None of the terms or provisions of this Agreement may be waived, altered,
modified or amended except by an instrument in writing, duly executed by the
Agent and Grantors. Upon the execution and delivery by any Person of a security
agreement supplement in substantially the form of Exhibit A hereto (each a
“Security Agreement Supplement”), such Person shall be referred to as an
“Additional Grantor” and shall be and become a Grantor hereunder, and each
reference in this Agreement and the other Loan Documents to “Grantor” shall also
mean and be a reference to such Additional Grantor, each reference in this
Agreement and the other Loan Documents to the “Collateral” shall also mean and
be a reference to the Collateral granted by such Additional Grantor and each
reference in this Agreement to a Schedule shall also mean and be a reference to
the schedules attached to such Security Agreement Supplement.
(e) Limitation by Law. All rights, remedies and powers provided in this
Agreement may be exercised only to the extent that the exercise thereof does not
violate any applicable provision of law, and all the provisions of this
Agreement are intended to be subject to all applicable mandatory provisions of
law that may be controlling and to be limited to the extent necessary so that
they shall not render this Agreement invalid, unenforceable, in whole or in
part, or not entitled to be recorded, registered or filed under the provisions
of any applicable law.
(f) Termination of this Agreement. Subject to Section 22(a) hereof, this
Agreement shall terminate upon Full Payment of the Obligations and the
termination of the Lenders’ commitments to lend under the Credit Agreement. In
addition, the Agent shall release in accordance with the terms of the Credit
Agreement its Lien on any Collateral that is sold, transferred or otherwise
disposed of to a Person that is not an Obligor, subject to the satisfaction of
all conditions to release (if any) set forth herein and in the Credit Agreement,
including the continuance of the Agent’s Lien in any proceeds of such
Collateral, and provided that such sale, transfer of other disposition is
authorized pursuant to this Agreement or is otherwise permitted pursuant to the
Credit Agreement.

 

18

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(g) Successors and Assigns. This Agreement and all obligations of each Grantor
hereunder shall be binding upon and inure to the benefit of the successors and
assigns of such Grantor (including any debtor-in-possession on behalf of such
Grantor) and shall, together with the rights, remedies and obligations of the
Agent, hereunder, inure to the benefit of and be binding upon the Secured
Parties, all future holders of any instrument evidencing any of the Obligations
and their respective successors and assigns. No sales of participations, other
sales, assignments, transfers or other dispositions of any agreement governing
or instrument evidencing the Obligations or any portion thereof or interest
therein shall in any manner affect the Lien granted to the Agent, for the
benefit of the Secured Parties, hereunder. Except as expressly permitted by the
terms of the Credit Agreement, no Grantor may assign, sell, hypothecate or
otherwise transfer any interest in or obligation under this Agreement.
(h) Counterparts. This Agreement may be authenticated in any number of separate
counterparts, each of which shall collectively and separately constitute one and
the same agreement. This Agreement may be authenticated by manual signature,
facsimile or, if approved in writing by the Agent, electronic means, all of
which shall be equally valid.
(i) Governing Law. This General Security Agreement shall be governed by and
construed in accordance with the laws of the Province of Ontario and the laws of
Canada applicable therein, except as required by mandatory provisions of law and
except to the extent that the validity or perfection of the security interests
hereunder, or remedies hereunder, in respect of any particular Collateral are
governed by the laws of a jurisdiction other than the Province of Ontario.
ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN
THE COURTS OF THE PROVINCE OF ONTARIO OR OF THE FEDERAL COURTS OF CANADA
THEREIN, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE CORPORATION
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. THE CORPORATION IRREVOCABLY WAIVES ANY OBJECTION,
INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM
NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION
OR PROCEEDING IN SUCH JURISDICTION OR ANY OTHER JURISDICTION SELECTED BY THE
LENDER IN RESPECT OF THIS AGREEMENT. THE CORPORATION WAIVES PERSONAL SERVICE OF
ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY THE LAW OF ONTARIO.
The parties hereto hereby waive trial by jury in any action, proceeding, claim
or counterclaim, whether in contract or tort, at law or in equity with respect
to, in connection with, or arising out of this General Security Agreement, other
financing agreements, the obligations of the Borrowers and the Corporation, the
Collateral, or any instrument, document or guarantee delivered pursuant hereto
or to any of the foregoing, or the validity, protection, interpretation,
administration, collection or enforcement hereof or thereof, or any other claim
or dispute hereunder or thereunder. The Corporation agrees that it will not
assert against the Lender any claim for consequential, incidental, special, or
punitive damages in connection with this General Security Agreement or the
transactions contemplated hereby or thereby. No officer of the Lender has
authority to waive, condition, or modify this provision.

 

19

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(j) Judgment Currency: If for the purpose of obtaining judgment in any court it
is necessary to convert an amount due hereunder in the currency in which it is
due (the “Original Currency”) into another currency (the “Second Currency”), the
rate of exchange applied shall be that at which, in accordance with normal
banking procedures, the Lender could purchase in the New York foreign exchange
market, the Original Currency with the Second Currency on the date two (2)
Business Days preceding that on which judgment is given. The Corporation agrees
that its obligation in respect of any Original Currency due from it hereunder
shall, notwithstanding any judgment or payment in such other currency, be
discharged only to the extent that, on the Business Day following the date the
Lender receives payment of any sum so adjudged to be due hereunder in the Second
Currency, the Lender may, in accordance with normal banking procedures,
purchase, in the New York foreign exchange market, the Original Currency with
the amount of the Second Currency so paid; and if the amount of the Original
Currency so purchased or could have been so purchased is less than the amount
originally due in the Original Currency, the Corporation agrees as a separate
obligation and notwithstanding any such payment or judgment to indemnify the
Lender against such loss. The term “rate of exchange” in this Section 8.16 means
the spot rate at which the Lender, in accordance with normal practices, is able
on the relevant date to purchase the Original Currency with the Second Currency,
and includes any premium and costs of exchange payable in connection with such
purchase.
(k) Section Titles. The Section titles contained in this Agreement are and shall
be without substantive meaning or content of any kind whatsoever and are not a
part of the agreement between the parties hereto.
(l) No Strict Construction. The parties hereto have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties hereto and no presumption or burden of
proof shall arise favouring or disfavouring any party by virtue of the
authorship of any provisions of this Agreement.
(m) Advice of Counsel. Each of the parties represents to each other party hereto
that it has discussed this Agreement and, specifically, the provisions of
Sections 22(i) and Section 22(j), with its counsel.
(n) Benefit of the Secured Parties. All Liens granted or contemplated hereby
shall be for the benefit of the Secured Parties, and all proceeds or payments
realized from the Collateral in accordance herewith shall be applied to the
Obligations (or the Guaranteed Obligations, as applicable) in accordance with
the terms of the Credit Agreement, and the other Loan Documents.

 

20

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SECTION 23. Release
Each of the parties hereto acknowledges and agrees that each of InfoManager
Inc., United Rentals Realty LLC and Wynne Systems, Inc. (each, a “Released
Grantor”) is an Immaterial Subsidiary, is no longer required to be a Grantor and
is therefore entitled to be released as a Grantor hereunder. The Agent shall
promptly execute and deliver, or cause to be promptly executed and delivered,
such documents and agreements, and shall promptly take or cause to be taken such
actions, as may be reasonably requested by the Grantors, at the Grantors
expense, to effectuate the release of any and all Liens previously granted by
the Released Grantors and to take such other actions as may be reasonably
requested by the Grantors, at the Grantors expense, to evidence such release as
may be reasonably requested by United Rentals, Inc.
SECTION 24. Amendment and Restatement
On the date hereof, the Existing Security Agreement is hereby amended, restated
and superseded in its entirety by this Agreement. The parties hereto acknowledge
and agree that (i) this Agreement and the other Loan Documents executed and
delivered in connection herewith do not constitute a novation, payment and
reborrowing, or termination of the “Obligations” (as defined under the Existing
Credit Agreement) or any of the other Loan Documents; (ii) such “Obligations”
are in all respects continuing (as amended and restated on the date hereof); and
(iii) the security interests, Lien and pledge granted under the Existing
Security Agreement and the other Loan Documents are in all respects continuing
and in full force and effect and are hereby fully ratified and affirmed in
favour of the Agent, for the benefit of the Secured Parties. Without limiting
the foregoing, each of the Grantors hereby fully and unconditionally ratifies
and affirms this Agreement and agrees that all security interests, Liens and
pledges granted hereunder and under the Existing Security Agreement shall from
and after the date hereof secure all Obligations hereunder and under the other
Loan Documents.
[Remainder of page intentionally left blank]

 

21

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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed and delivered by its duly authorized officer as of the date first set
forth above.

                  GRANTORS:    
 
                UNITED RENTALS (NORTH AMERICA), INC.    
 
           
 
  Per:   /s/ Irene Moshouris    
 
     
 
Name: Irene Moshouris    
 
      Title: Senior Vice President and Treasurer  
 
           
 
  Per:   /s/ Joli Lyn Goss    
 
     
 
Name: Joli Lyn Goss    
 
      Title: Assistant Secretary    
 
                UNITED RENTALS (DELAWARE), INC.    
 
           
 
  Per:   /s/ Irene Moshouris    
 
     
 
Name: Irene Moshouris    
 
      Title: Vice President and Treasurer    
 
           
 
  Per:   /s/ Joli Lyn Goss    
 
     
 
Name: Joli Lyn Goss    
 
      Title: Assistant Secretary    
 
                UNITED RENTALS NORTHWEST, INC.    
 
           
 
  Per:   /s/ Irene Moshouris    
 
     
 
Name: Irene Moshouris    
 
      Title: Vice President and Treasurer    
 
           
 
  Per:   /s/ Joli Lyn Goss    
 
     
 
Name: Joli Lyn Goss    
 
      Title: Assistant Secretary    

 

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                  UNITED RENTALS, INC.    
 
           
 
  Per:   /s/ Irene Moshouris    
 
     
 
Name: Irene Moshouris    
 
      Title: Senior Vice President and Treasurer    
 
           
 
  Per:   /s/ Joli Lyn Gross    
 
     
 
Name: Joli Lyn Gross    
 
      Title: Assistant Secretary    
 
                UNITED RENTALS OF CANADA, INC.    
 
           
 
  Per:   /s/ Irene Moshouris    
 
     
 
Name: Irene Moshouris    
 
      Title: Vice President and Treasurer    
 
           
 
  Per:   /s/ Joli Lyn Gross    
 
     
 
Name: Joli Lyn Gross    
 
      Title: Assistant Secretary    
 
                UNITED RENTALS FINANCING LIMITED PARTNERSHIP, by its general
partner, UNITED RENTALS OF NOVA SCOTIA (NO. 1), ULC    
 
           
 
  Per:   /s/ Irene Moshouris    
 
     
 
Name: Irene Moshouris    
 
      Title: Vice President and Treasurer    
 
           
 
  Per:   /s/ Joli Lyn Gross    
 
     
 
Name: Joli Lyn Gross    
 
      Title: Assistant Secretary    

 

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                  UNITED RENTALS OF NOVA SCOTIA (NO. 1), ULC    
 
           
 
  Per:   /s/ Irene Moshouris    
 
     
 
Name: Irene Moshouris    
 
      Title: Vice President and Treasurer    
 
           
 
  Per:   /s/ Joli Lyn Gross    
 
     
 
Name: Joli Lyn Gross    
 
      Title: Assistant Secretary    
 
                UR CANADIAN FINANCING PARTNERSHIP, by its managing partner,
UNITED RENTALS FINANCING LIMITED PARTNERSHIP, by its general partner, UNITED
RENTALS OF NOVA SCOTIA (NO. 1), ULC    
 
           
 
  Per:   /s/ Irene Moshouris    
 
     
 
Name: Irene Moshouris    
 
      Title: Vice President and Treasurer    
 
           
 
  Per:   /s/ Joli Lyn Gross    
 
     
 
Name: Joli Lyn Gross    
 
      Title: Assistant Secretary    
 
                UNITED RENTALS OF NOVA SCOTIA (NO. 2), ULC    
 
           
 
  Per:   /s/ Irene Moshouris    
 
     
 
Name: Irene Moshouris    
 
      Title: Vice President and Treasurer    
 
           
 
  Per:   /s/ Joli Lyn Gross    
 
     
 
Name: Joli Lyn Gross    
 
      Title: Assistant Secretary    

 

24

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                  UNITED RENTALS HIGHWAY
TECHNOLOGIES GULF, LLC    
 
           
 
  Per:   /s/ Irene Moshouris    
 
     
 
Name: Irene Moshouris    
 
      Title: Vice President and Treasurer    
 
           
 
  Per:   /s/ Joli Lyn Gross    
 
     
 
Name: Joli Lyn Gross    
 
      Title: Assistant Secretary    
 
                AGENT:    
 
                BANK OF AMERICA, N.A.    
 
           
 
  Per:   /s/ Cynthia G. Stannard     
 
     
 
Name: Cynthia G. Stannard    
 
      Title: Senior Vice President    
 
           
 
  Per:        
 
     
 
Name:    
 
      Title:    

 

25

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SCHEDULE I TO AGREEMENT
JURISDICTION OF INCORPORATION

                  State/Province of   Organizational ID     Grantor  
Organization   Number   Type of Entity
United Rentals, Inc.
  Delaware   06-1522496   Corporation
United Rentals (North America), Inc.
  Delaware   06-1493538   Corporation
United Rentals Northwest, Inc.
  Oregon   93-0257120   Corporation
United Rentals Financing Limited Partnership
  Delaware   77-0704457   Limited Partnership
United Rentals (Delaware), Inc.
  Delaware   51-0414593   Corporation
United Rentals Highway Technologies Gulf, LLC
  Delaware   06-1604996   Limited Liability Company
United Rentals of Canada, Inc.
  Canada   001847581   Corporation
UR Canadian Financing Partnership
  Nova Scotia   N/A   General Partnership
United Rentals of Nova Scotia (No. 1), ULC
  Nova Scotia   3060814   Unlimited Liability Company
United Rentals of Nova Scotia (No. 2), ULC
  Nova Scotia   3060815   Unlimited Liability Company

 

26

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SCHEDULE II TO AGREEMENT
PATENTS, TRADEMARKS AND COPYRIGHTS

                                  Application   Registration           Filing  
Registration     Trademark   No.   No.   Status   Country   Date   Date  
Grantor
VENETOR
  1529888   Pending   Formalized   Canada   02-Jun-2011   Pending   UNITED
RENTALS OF CANADA, INC.
CONSIDER IT DONE
  1295239   TMA733,843   Registered   Canada   27-Mar-2006   03-Feb-2009  
UNITED RENTALS, INC.
DESIGN MARK
  876279   518170   Registered   Canada   24-Apr-1998   19-Oct-1999   UNITED
RENTALS, INC.
L’EQUIPMENT QU’IL VOUS FAUT, NOUS L’AVONS!
  1067463   TMA567,559   Registered   Canada   18-Jul-2000   18-Sep-2002  
UNITED RENTALS, INC.
THE RIGHT EQUIPMENT. RIGHT NOW!
  1052921   TMA575,374   Registered   Canada   29-Mar-2000   11-Feb-2003  
UNITED RENTALS, INC.
THE RIGHT EQUIPMENT. RIGHT NOW!
  431685   680198   Registered   Mexico   19-Jun-2000   30-Nov-2000   UNITED
RENTALS, INC.
THE RIGHT EQUIPMENT. RIGHT NOW!
  431682   681007   Registered   Mexico   19-Jun-2000   14-Dec-2000   UNITED
RENTALS, INC.
THE RIGHT EQUIPMENT. RIGHT NOW!
  75/921,932   2419254   Registered   United States of America   17-Feb-2000  
09-Jan-2001   UNITED RENTALS, INC.
THE UNDERGROUND EQUIPMENT SPECIALIST
  75/756,944   2410275   Registered   United States of America   21-Jul-1999  
05-Dec-2000   UNITED RENTALS, INC.
UNITED RENTALS
  75/445,513   2476091   Registered   United States of America   05-Mar-1998  
07-Aug-2001   UNITED RENTALS, INC.
UNITED RENTALS MISCELLANEOUS DESIGN
  75/449,210   2,406,720   Registered   United States of America   12-Mar-1998  
12-Nov-2000   UNITED RENTALS, INC.
UNITED RENTALS
  876152   518086   Registered   Canada   23-Apr-1998   18-Oct-1999   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  2254631   1827565   Registered   Argentina   29-Nov-1999   02-May-2001  
UNITED RENTALS, INC.
UNITED RENTALS AND DESIGN
  2254632   1929994   Registered   Argentina   29-Nov-1999   02-Sep-2004  
UNITED RENTALS, INC.
UNITED RENTALS AND DESIGN
  2254630   1827564   Registered   Argentina   29-Nov-1999   02-May-2001  
UNITED RENTALS, INC.
UNITED RENTALS AND DESIGN
  1999-0009837   123726   Registered   Costa Rica   24-Nov-1999   05-Feb-2001  
UNITED RENTALS, INC.
UNITED RENTALS AND DESIGN
  1999-0009838   124567   Registered   Costa Rica   24-Nov-1999   22-Oct-2001  
UNITED RENTALS, INC.
UNITED RENTALS AND DESIGN
  1999-0009836   124540   Registered   Costa Rica   24-Nov-1999   22-Oct-2001  
UNITED RENTALS, INC.

 

27

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                                  Application   Registration           Filing  
Registration     Trademark   No.   No.   Status   Country   Date   Date  
Grantor
UNITED RENTALS AND DESIGN
  E-8478-99   12 BOOK 166   Registered   El Salvador   01-Dec-1999   04-Feb-2003
  UNITED RENTALS, INC.
UNITED RENTALS AND DESIGN
  7246/2000   7.33   Registered   Honduras   18-May-2000   27-Dec-2000   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  7245/2000   7.329   Registered   Honduras   18-May-2000   27-Dec-2000   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  409635   673099   Registered   Mexico   07-Feb-2000   29-Sep-2000   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  409632   673098   Registered   Mexico   07-Feb-2000   29-Sep-2000   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  409633   669974   Registered   Mexico   07-Feb-2000   30-Aug-2000   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  421994   678920   Registered   Mexico   19-Apr-2000   28-Nov-2000   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  421989   660547   Registered   Mexico   19-Apr-2000   26-Jun-2000   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  409634   696659   Registered   Mexico   07-Feb-2000   26-Apr-2001   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  99-04483   46613   Registered   Nicaragua   23-Dec-1999   24-Jan-2001   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  99-04482   46612   Registered   Nicaragua   23-Dec-1999   24-Jan-2001   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  99-04484   46614   Registered   Nicaragua   23-Dec-1999   24-Jan-2001   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  108235   108235   Registered   Panama   21-Jun-2000   20-Nov-2001   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  108234   108234   Registered   Panama   21-Jun-2000   20-Nov-2001   UNITED
RENTALS, INC.
UNITED RENTALS AND DESIGN
  108233   108233   Registered   Panama   21-Jun-2000   20-Nov-2001   UNITED
RENTALS, INC.
UNITED RENTALS EL EQUIPO ADECUADO. AL MOMENTO
  630144   848979   Registered   Mexico   19-Nov-2003   24-Aug-2004   UNITED
RENTALS, INC.
UNITED RENTALS EL EQUIPO ADECUADO. AL MOMENTO
  630143   848040   Registered   Mexico   19-Nov-2003   20-Aug-2004   UNITED
RENTALS, INC.
UNITED RENTALS THE RIGHT EQUIPMENT RIGHT NOW!
  1081162   TMA598,919   Registered   Canada   02-Nov-2000   09-Jan-2004  
UNITED RENTALS, INC.
URDATA
  1052617   TMA566,254   Registered   Canada   28-Mar-2000   22-Aug-2002  
UNITED RENTALS, INC.
URDATA
  434407   730884   Registered   Mexico   04-Jul-2000   30-Jan-2002   UNITED
RENTALS, INC.

 

28

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                                  Application   Registration           Filing  
Registration     Trademark   No.   No.   Status   Country   Date   Date  
Grantor
URDATA
  434409   744011   Registered   Mexico   04-Jul-2000   30-Apr-2002   UNITED
RENTALS, INC.
URDATA
  76/011015   2497914   Registered   United States of America   24-Mar-2000  
16-Oct-2001   UNITED RENTALS, INC.
GOT TOOLS?
  78/401,442   3,034,458   Registered   United States of America   14-Apr-2004  
27-Dec-2005   URNA (ASSIGNMENT TO URI PENDING)
ALL THE RIGHT TOOLS
  76/376,777   3,069,631   Registered   United States of America   28-Feb-2002  
21-Mar-2006   URNA (ASSIGNMENT TO URI PENDING)
THE TOOLS TO SATISFY
  78/622,914   3,085,242   Registered   United States of America   04-May-2005  
25-Apr-2006   URNA (ASSIGNMENT TO URI PENDING)
LEASCO
  76/376,463   2,921,928   Registered   United States of America   28-Feb-2002  
28-Feb-2002   URNA (ASSIGNMENT TO URI PENDING)
US RENTALS & DESIGN
  74141973   1735268   Registered   United States of America   25-Feb-1991  
24-Nov. 1992   UNITED RENTALS (NORTH AMERICA) INC.
UNITED GUARD
  85342236   N/A   Pending   United States of America   9-June-2001   N/A  
UNITED RENTALS, INC.
UNITED RENTALS & DESIGN
  853319031   N/A   Pending   United States of America   6-June-2011   N/A  
UNITED RENTALS, INC.
VERTICADE
  76141032   2613339   Registered   United States of America   4-Oct-2000  
27-Aug.-2002   UNITED RENTALS, INC.

 

29

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Exhibit A to the
Security Agreement
FORM OF SECURITY AGREEMENT SUPPLEMENT
[Date of Security Agreement Supplement]
To: Bank of America, N.A., as Agent
Ladies and Gentlemen:
Reference is made to (i) the Amended and Restated Credit Agreement, dated of
October  14  2011 (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the “Credit Agreement”), among United
Rentals, Inc., a Delaware corporation (“Holdings”), United Rentals (North
America), Inc., a Delaware corporation (the “Company”), the other U.S.
Subsidiary Borrowers named therein (together with the Company, the “U.S.
Borrowers”), United Rentals of Canada, Inc., a corporation amalgamated under the
laws of the Province of Ontario (the “Canadian Borrower”), United Rentals
Financing Limited Partnership (the “Specified Loan Borrower”), the Lenders from
time to time party thereto, and Bank of America, N.A., as Agent and (ii) the
Amended and Restated Canadian Security Agreement dated as of October  14 2011
(as amended, amended and restated, supplemented or otherwise modified from time
to time, the “Security Agreement”) made by the Grantors from time to time party
thereto in favour of the Agent for the benefit of the Secured Parties. Terms
defined in the Credit Agreement or the Security Agreement and not otherwise
defined herein are used herein as defined in the Credit Agreement or the
Security Agreement.
SECTION 1. Grant of Lien. As security for the due and prompt payment and
performance when due (whether at the stated maturity, or on any earlier date of
a required prepayment by reason of acceleration, demand or otherwise) by the
undersigned of all of its present and future Obligations whether now or
hereafter existing (including, without limitation, any extensions,
modifications, substitutions, amendments or renewals of any or all of the
foregoing Obligations), whether direct or indirect, absolute or contingent, and
whether for principal, interest, premiums, fees, indemnities, contract causes of
action, costs, expenses or otherwise. the undersigned hereby grants, to the
Agent, its successors and assigns, for the ratable benefit of the applicable
Secured Parties, a security interest (the “Security Interest”) in and continuing
lien upon and right of set-off against, on all personal property, assets and
undertakings of the undersigned, including, without limitation, all of the
undersigned’s right, title and interest in or to any and all of the following
properties and assets of the undersigned and powers and rights of the
undersigned in all of the following (including the power to transfer rights in
the following), whether now owned or existing or at any time hereafter acquired
or arising, regardless of where located (collectively, the “Collateral”):
(i) all Accounts (other than Accounts subject to any Qualified Receivables
Transactions), including all debts, book debts, accounts, claims, demands,
moneys and choses in action whatsoever including, without limitation, claims
against the Crown and claims under insurance policies, which are now owned by or
are due, owing or accruing due to the undersigned or which may

 

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hereafter be owned by or become due, owing or accruing due to the undersigned
together with all contracts, investment property, bills, notes, lien notes,
judgments, chattel mortgages, mortgages and all other rights, benefits and
documents now or hereafter taken, vested in or held by the undersigned in
respect of or as security for the same and the full benefit and advantage
thereof, and all rights of action or claims which the undersigned now has or may
at any time hereafter have against any Person in respect thereof;
(ii) all Inventory, including, without limitation, all Rental Equipment, goods,
merchandise, raw materials, goods in process, finished goods, packaging and
packing material and other tangible personal property now or hereafter held for
sale, lease, rental or resale or that are to be furnished or have been furnished
under a contract of service or that are to be used or consumed in the business
of the undersigned;
(iii) all leases of Inventory, Equipment and other Goods (whether or not in the
form of a lease agreement), including all Leases;
(iv) all documentation evidencing rights in any Inventory or Equipment,
including all certificates, Certificates of Title, Manufacturer’s Statements of
Origin, and other Collateral Instruments (as such terms are defined in the UCC);
(v) all contract rights, including contract rights in respect of any Like-Kind
Exchange;
(vi) all Chattel Paper;
(vii) all Documents;
(viii) all Instruments;
(ix) all Supporting Obligations and Letter-of-Credit Rights (as such terms are
defined in the UCC);
(x) all General Intangibles including Software (as such term is defined in the
UCC) and Payment Intangibles;
(xi) all Goods (excluding “Consumer Goods” as such term is defined in the PPSA);
(xii) all Equipment;
(xiii) all Investment Property;
(xiv) all money, cash, cash equivalents, securities and other property of any
kind of the undersigned held directly or indirectly by the Agent, any Lender or
any of their Affiliates;
(xv) all of the undersigned’s Material Accounts, credits, and balances with and
other claims against the Agent or any Lender or any of their Affiliates or any
other financial institution with which the undersigned maintains deposits,
including all Payment Accounts;

 

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(xvi) all books, records and other property related to or referring to any of
the foregoing, including books, records, account ledgers, data processing
records, computer software and other property;
(xvii) The uncalled capital, money, rights, bills of exchange, negotiable and
non negotiable instruments, judgments and securities not otherwise described in
the foregoing; and
(xviii) all accessions to, substitutions for and replacements, products and
proceeds derived directly or indirectly of any of the foregoing, including, but
not limited to, proceeds of any insurance policies, claims against third
parties, and condemnation or requisition payments with respect to all or any of
the foregoing;
provided, however, the “Collateral” shall not include any asset or rights or
interests of the undersigned as described in the proviso to Section 1(a) of the
Security Agreement.
(b) All of the Obligations of each respective undersigned shall be secured by
all of the Collateral of the undersigned and any other property of the
undersigned that secures any of the Secured Obligations.
SECTION 2. Representations and Warranties. (a) The undersigned represents and
warrants to the Agent and the other Secured Parties that as of the date hereof:
(i) Schedule I hereto identifies (A) the undersigned name as of the date hereof
as it appears in official filings in the state or other jurisdiction of its
incorporation or other organization, (B) the type of entity of the undersigned
(including corporation, partnership, limited partnership or limited liability
company), (C) the organizational identification number issued by the
undersigned’s state, province or territory of incorporation or organization or a
statement that no such number has been issued, and (D) the jurisdiction in which
the undersigned is incorporated or organized; and (ii) the undersigned has only
one state, province or territory of incorporation or organization.
(b) The undersigned hereby makes each other representation and warranty set
forth in the Security Agreement with respect to itself and the Collateral owned
by it. The undersigned hereby represents and warrants to the Agent and the other
Secured Parties that the attached Schedule II contains all information with
respect to itself and the Collateral owned by it that is required to be set
forth in Schedule II to the Security Agreement with respect to the Grantors and
their Collateral.
(c) The undersigned hereby makes each representation and warranty set forth in
the Credit Agreement that is made with respect to any Canadian Obligor.

 

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SECTION 3. Obligations Under the Security Agreement. The undersigned hereby
agrees, as of the date first above written, to be bound as a Grantor by all of
the terms and provisions of the Security Agreement to the same extent as each of
the other Grantors. The undersigned further agrees, as of the date first above
written, that each reference in the Security Agreement to an “Additional
Grantor” or a “Grantor” shall also mean and be a reference to the undersigned,
that each reference to the “Collateral” or any part thereof shall also mean and
be a reference to the undersigned’s Collateral or part thereof, as the case may
be, and that each reference in the Security Agreement to a Schedule shall also
mean and be a reference to the schedules attached hereto.
SECTION 4. Obligations under the Credit Agreement. The undersigned hereby
agrees, as of the date first above written, to be bound as an Obligor, Canadian
Obligor, Guarantor and Canadian Guarantor by all of the terms and provisions of
the Credit Agreement to the same extent as though the undersigned were a party
to the Credit Agreement in each such capacity from and after the date hereof.
The undersigned further agrees, as of the date first above written, that each
reference in the Credit Agreement to an “Obligor” or a “Canadian Obligor” or a
“Guarantor” or “Canadian Guarantor” shall also mean and be a reference to the
undersigned.
SECTION 5. Governing Law. This Security Agreement Supplement shall be governed
by, and construed in accordance with, the laws of the Province of Ontario and
the federal laws of Canada applicable therein.
(signature pages follow)

 

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                  Very truly yours,    
 
                [NAME OF ADDITIONAL GRANTOR]    
 
           
 
  By        
 
     
 
Title:    

         
 
  Address for notices:    
 
       
 
 
 
   
 
       
 
 
 
   
 
       
 
 
 
   

 

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SCHEDULE I
to
AGREEMENT
JURISDICTIONS OF ORGANIZATION

                  State/Province of         Grantor   Organization   Type of
Entity   Organizational I.D.              

 

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SCHEDULE II
to
AGREEMENT
PATENTS, TRADEMARKS AND COPYRIGHTS
Trademarks:

                                  Application or       Registration Grantor  
Country   Trademark   Registration No.   Filing Date   Date                    
 

Patents:

                                      Application   Filing   Issue     Grantor  
Country   Title   or Patent No.   Date   Date   Assignees                      
   

Copyrights:

                                  Application or       Registration Grantor  
Country   Copyright   Registration No.   Filing Date   Date