ex_288013.htm


EXHIBIT 10.2


 


 


 


 


 


 


 










 


 


 


Guarantee and Collateral Agreement


 


Dated as of May 23, 2012


 


made by


 


GLOBAL TELECOM & TECHNOLOGY, INC.


 


GLOBAL TELECOM & TECHNOLOGY AMERICAS, INC.


 


PACKETEXCHANGE (USA), INC.


 


PACKETEXCHANGE, INC.


 


WBS CONNECT LLC


 


NLAYER COMMUNICATIONS, INC.


 


TEK CHANNEL CONSULTING, LLC


 


GTT GOVERNMENT SERVICES, LLC


 


and the other Grantors referred to herein,


 







 







 


in favor of


 







 


SILICON VALLEY BANK,


as Administrative Agent







 


 


 


 


















  





  











  













TABLE OF CONTENTS


 


Page


 



	
SECTION 1.

	
DEFINED TERMS 

	
1







 



	
  

	
1.1

	
Definitions 

	
1








	
  

	
1.2

	
Other Definitional Provisions 

	
5







 



	
SECTION 2.

	
GUARANTEE 

	
5







 



	
  

	
2.1

	
Guarantee 

	
5








	
  

	
2.2

	
Right of Contribution 

	
6








	
  

	
2.3

	
No Subrogation 

	
6








	
  

	
2.4

	
Amendments, etc 

	
6








	
  

	
2.5

	
Guarantee Absolute and Unconditional; Guarantor Waivers; Guarantor Consents 

	
7








	
  

	
2.6

	
Reinstatement 

	
9








	
  

	
2.7

	
Payments 

	
9







 



	
SECTION 3.

	
GRANT OF SECURITY INTEREST 

	
9







 



	
  

	
3.1

	
Grant of Security Interests 

	
9








	
  

	
3.2

	
Grantors Remains Liable 

	
10








	
  

	
3.3

	
Perfection and Priority 

	
11







 



	
SECTION 4.

	
REPRESENTATIONS AND WARRANTIES 

	
12







 



	
  

	
4.1

	
Title; No Other Liens 

	
12








	
  

	
4.2

	
Perfected Liens 

	
13








	
  

	
4.3

	
Jurisdiction of Organization; Chief Executive Office and Locations of Books 

	
13








	
  

	
4.4

	
Inventory and Equipment 

	
13








	
  

	
4.5

	
Farm Products 

	
13








	
  

	
4.6

	
Pledged Collateral 

	
13








	
  

	
4.7

	
Investment Accounts 

	
14








	
  

	
4.8

	
Receivables 

	
14








	
  

	
4.9

	
Intellectual Property 

	
14








	
  

	
4.10

	
Instruments 

	
14








	
  

	
4.11

	
Letter of Credit Rights 

	
15








	
  

	
4.12

	
Commercial Tort Claims 

	
15







 



	
SECTION 5.

	
COVENANTS 

	
15







 



	
  

	
5.1

	
Delivery of Instruments, Certificated Securities and Chattel Paper 

	
15








	
  

	
5.2

	
Maintenance of Insurance 

	
15








	
  

	
5.3

	
Maintenance of Perfected Security Interest; Further Documentation 

	
15








	
  

	
5.4

	
Changes in Locations, Name, Etc 

	
16








	
  

	
5.5

	
Notices 

	
16








	
  

	
5.6

	
Instruments; Investment Property 

	
16








	
  

	
5.7

	
Securities Accounts; Deposit Accounts 

	
17








	
  

	
5.8

	
Intellectual Property 

	
18








	
  

	
5.9

	
Receivables 

	
19








	
  

	
5.10

	
Defense of Collateral 

	
19








	
  

	
5.11

	
Preservation of Collateral 

	
19








	
  

	
5.12

	
Compliance with Laws, Etc 

	
19















  





i











  



TABLE OF CONTENTS


(continued)


Page


 
















	
  

	
5.13

	
Location of Books and Chief Executive Office 

	
19








	
  

	
5.14

	
Location of Collateral 

	
19








	
  

	
5.15

	
Maintenance of Records 

	
19








	
  

	
5.16

	
Disposition of Collateral 

	
19








	
  

	
5.17

	
Liens 

	
19








	
  

	
5.18

	
Expenses 

	
19








	
  

	
5.19

	
Leased Premises; Collateral Held by Warehouseman, Bailee, Etc 

	
19








	
  

	
5.20

	
Chattel Paper 

	
20








	
  

	
5.21

	
Commercial Tort Claims 

	
20








	
  

	
5.22

	
Letter-of-Credit Rights 

	
20








	
  

	
5.23

	
Shareholder Agreements and Other Agreements 

	
20







 



	
SECTION 6.

	
REMEDIAL PROVISIONS 

	
20







 



	
  

	
6.1

	
Certain Matters Relating to Receivables 

	
20








	
  

	
6.2

	
Communications with Obligors; Grantors Remain Liable 

	
21








	
  

	
6.3

	
Investment Property 

	
21








	
  

	
6.4

	
Proceeds to be Turned Over To Administrative Agent 

	
22








	
  

	
6.5

	
Application of Proceeds 

	
23








	
  

	
6.6

	
Code and Other Remedies 

	
23








	
  

	
6.7

	
Registration Rights 

	
23








	
  

	
6.8

	
Intellectual Property License 

	
24








	
  

	
6.9

	
Deficiency 

	
24







 



	
SECTION 7.

	
THE ADMINISTRATIVE AGENT 

	
24







 



	
  

	
7.1

	
Administrative Agent’s Appointment as Attorney-in-Fact, etc 

	
25








	
  

	
7.2

	
Duty of Administrative Agent 

	
26








	
  

	
7.3

	
Authority of Administrative Agent 

	
26







 



	
SECTION 8.

	
MISCELLANEOUS 

	
27







 



	
  

	
8.1

	
Amendments in Writing 

	
27








	
  

	
8.2

	
Notices 

	
27








	
  

	
8.3

	
No Waiver by Course of Conduct; Cumulative Remedies 

	
27








	
  

	
8.4

	
Enforcement Expenses; Indemnification 

	
27








	
  

	
8.5

	
Successors and Assigns 

	
27








	
  

	
8.6

	
Set Off 

	
28








	
  

	
8.7

	
Counterparts 

	
28








	
  

	
8.8

	
Severability 

	
28








	
  

	
8.9

	
Section Headings 

	
28








	
  

	
8.10

	
Integration 

	
28








	
  

	
8.11

	
GOVERNING LAW 

	
28








	
  

	
8.12

	
Submission To Jurisdiction; Waivers 

	
28








	
  

	
8.13

	
Acknowledgements 

	
29








	
  

	
8.14

	
Additional Grantors 

	
29








	
  

	
8.15

	
Releases 

	
29








	
  

	
8.16

	
WAIVER OF JURY TRIAL 

	
30












 










  





ii











  



TABLE OF CONTENTS


(continued)




















SCHEDULES


 


Schedule 1                      Notice Addresses


Schedule 2                      Investment Property


Schedule 3                      Perfection Matters


Schedule 4                      Jurisdictions of Organization and Chief Executive Offices, etc.


Schedule 5                      Equipment and Inventory Locations


Schedule 6                      Intellectual Property


Schedule 7                      Letter of Credit Rights


Schedule 8                      Commercial Tort Claims







 


ANNEXES


 


Annex 1                      Form of Assumption Agreement


Annex 2                      Form of Pledge Supplement


 










  





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GUARANTEE AND COLLATERAL AGREEMENT


 


This GUARANTEE AND COLLATERAL AGREEMENT (this “Agreement”), dated as of May 23, 2012, is made by each of the signatories hereto (together with any other entity that may become a party hereto as provided herein, each a “Grantor” and, collectively, the “Grantors”), in favor of SILICON VALLEY BANK (“SVB”), as administrative agent (together with its successors, in such capacity, the “Administrative Agent”) for the banks and other financial institutions or entities (each a “Lender” and, collectively, the “Lenders”) from time to time parties to that certain Credit Agreement, dated as of the date hereof (as amended, amended and restated, supplemented, restructured or otherwise modified, renewed or replaced from time to time, the “Credit Agreement”), among GLOBAL TELECOM AND TECHNOLOGY, INC., a Delaware corporation (“GTTI”), GLOBAL TELECOM & TECHNOLOGY AMERICAS, INC., a Virginia corporation (“GTTA”), PACKETEXCHANGE (USA), INC., a Delaware corporation (“PEUSA”), PACKETEXCHANGE, INC., a Delaware corporation (“PEINC”), WBS CONNECT LLC, a Colorado limited liability company (“WBS”), NLAYER COMMUNICATIONS, INC., an Illinois corporation (“nLAYER”), (GTTI, GTTA, PEUSA, PEINC, WBS and nLAYER are hereinafter referred to, individually, as a “Borrower” and collectively, jointly and severally, as the “Borrowers”), the Guarantors party thereto, the Lenders party thereto and the Administrative Agent.


 


INTRODUCTORY STATEMENTS


 


WHEREAS, the Borrowers are members of an affiliated group of companies that includes each other Grantor;


 


WHEREAS, the proceeds of the extensions of credit under the Credit Agreement will be used in part to enable the Borrowers to make valuable transfers to one or more of the other Grantors in connection with the operation of their respective business;


 


WHEREAS, Borrowers and each Grantor have executed and delivered a certain Second Amended and Restated Unconditional Guaranty to SVB, dated as of the date hereof (as may be amended, restated, or otherwise modified from time to time, the “European Guaranty), pursuant to which the Loan Parties agreed to guaranty all of the obligations and liabilities (the “European Guaranty Obligations”) of GTT-EMEA, LTD., a private limited liability company incorporated and registered in England and Wales with offices located at 5th Floor, Morley House, 26 Holborn Viaduct, London EC1A 2AT (“EMEA”), PACKETEXCHANGE (IRELAND) LIMITED, a company incorporated and existing under the laws of Ireland with registered number 373202, and whose registered address is 24-26 City Quay, Dublin 2 Ireland (“PEIRL”) and PACKETEXCHANGE (EUROPE) LIMITED, a private limited company incorporated and registered in England and Wales under company number 05164474 (“PELTD” and together with EMEA and PEIRL, individually and collectively, jointly and severally, the “European Borrower”), owed to SVB pursuant to that certain Amended and Restated Loan and Security Agreement by and between European Borrower and Bank dated as of June 29, 2011 (as may be amended, restated, or otherwise modified from time to time, the “European Loan Agreement”);


 


WHEREAS the European Guaranty Obligations are secured by the Collateral granted to Agent and the Lenders hereunder;


 


WHEREAS, certain of the Qualified Counterparties may enter into Specified Swap Agreements with the Borrowers;


 


WHEREAS, the Borrowers and the other Grantors are engaged in related businesses, and each Grantor derives substantial direct and indirect benefit from the extensions of credit under the Credit Agreement and from the Specified Swap Agreements; and


 










  





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WHEREAS, it is a condition precedent to the Closing Date that the Grantors shall have executed and executed and delivered this Agreement in favor of the Administrative Agent for the ratable benefit of the Secured Parties.


 


NOW, THEREFORE, in consideration of the above premises, the parties hereto hereby agree as follows:


 


SECTION 1.   Defined Terms.


 


1.1           Definitions.


 


(a)           Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the respective meanings given to such terms in the Credit Agreement, and the following terms are used herein as defined in the UCC:  Account, Certificated Security, Chattel Paper, Commercial Tort Claim, Commodity Account, Document, Equipment, Farm Products, Fixtures, General Intangible, Goods, Instrument, Inventory, Letter-of-Credit Rights, Money, Securities Account and Supporting Obligation.


 


(b)           The following terms shall have the following meanings:


 


“Agreement”:  as defined in the preamble hereto.


 


“Books”: all books, records and other written, electronic or other documentation in whatever form maintained now or hereafter by or for any Grantor in connection with the ownership of its assets or the conduct of its business or evidencing or containing information relating to the Collateral, including:  (a) ledgers; (b) records indicating, summarizing, or evidencing such Grantor’s assets (including Inventory and Rights to Payment), business operations or financial condition; (c) computer programs and software; (d) computer discs, tapes, files, manuals, spreadsheets; (e) computer printouts and output of whatever kind; (f) any other computer prepared or electronically stored, collected or reported information and equipment of any kind; and (g) any and all other rights now or hereafter arising out of any contract or agreement between such Grantor and any service bureau, computer or data processing company or other Person charged with preparing or maintaining any of such Grantor’s books or records or with credit reporting, including with regard to any of such Grantor’s Accounts.


 


“Borrower” and “Borrowers”:  as defined in the preamble hereto.


 


“Collateral”: as defined in Section 3.1.


 


“Collateral Account”:  any collateral account established by the Administrative Agent as provided in Section 6.1 or 6.4.


 


“Copyright License”:  any written agreement which (a) names a Grantor as licensor or licensee (including those listed on Schedule 6), or (b) grants any right under any Copyright to a Grantor, including any rights to manufacture, distribute, exploit and sell materials derived from any Copyright.


 


“Copyrights”:  (a) all copyrights arising under the laws of the United States, any other country or any political subdivision thereof, together with the underlying works of authorship (including titles), whether registered or unregistered and whether published or unpublished (including those listed on Schedule 6), all computer programs, computer databases, computer program flow diagrams, source codes, object codes and all tangible property embodying or incorporating any copyrights, all registrations and recordings thereof, and all applications in connection therewith, including, without limitation, all


 










  





2











  













registrations, recordings and applications in the U.S. Copyright Office, and (b) the right to obtain any renewals thereof.


 


“Deposit Account”:  as defined in the Uniform Commercial Code of any applicable jurisdiction and, in any event, including any demand, time, savings, passbook or like account maintained with a depositary institution.


 


“Discharge of Obligations”: as defined in Section 2.1(d).


 


“European Borrower”: as defined in the Introductory Statements hereto.


 


“European Guaranty”: as defined in the Introductory Statements hereto.


 


“European Guaranty Obligations”: as defined in the Introductory Statements hereto.


 


“Excluded Assets”: collectively, any Loan Party’s equity ownership interest in any European Borrower that is from time to time a party to the European Loan Agreement, provided, however, that any Proceeds, substitutions or replacements of any Excluded Assets shall not be Excluded Assets (unless such Proceeds, substitutions or replacements are otherwise, in and of themselves, Excluded Assets).


 


“Grantor”: as defined in the preamble hereto.


 


“Guarantor”: as defined in Section 2.1(a).


 


“Investment Account”: any of a Securities Account, a Commodity Account or a Deposit Account.


 


“Investment Property”:  the collective reference to (a) all “investment property” as such term is defined in Section 9-102(a)(49) of the New York UCC (other than any voting Capital Stock or other ownership interests of a Material First Tier Foreign Subsidiary excluded from the definition of “Pledged Stock”), and (b) whether or not constituting “investment property” as so defined, all Pledged Notes and all Pledged Collateral.


 


“Issuer”: with respect to any Investment Property, the issuer of such Investment Property.


 


“Patent License”: any written agreement which (a) names a Grantor as licensor or licensee and (b) grants to such Grantor any right under a Patent, including the right to manufacture, use or sell any invention covered in whole or in part by such Patent, including any such agreements referred to on Schedule 6.


 


“Patents”: (a) all letters patent of the United States, any other country or any political subdivision thereof, all reissues and extensions thereof and all goodwill associated therewith, including, without limitation, any of the foregoing referred to on Schedule 6, (b) all applications for letters patent of the United States or any other country and all divisions, continuations and continuations-in-part thereof, including, without limitation, any of the foregoing referred to on Schedule 6, and (c) all rights to obtain any reissues or extensions of the foregoing.


 


“Pledged Collateral”: (a) any and all Pledged Stock; (b)  all other Investment Property of any Grantor; (c) all warrants, options or other rights entitling any Grantor to acquire any interest in Capital Stock or other securities of the direct or indirect Subsidiaries of such Grantor or of any other Person; (d) all Instruments; (e) all securities, property, interest, dividends and other payments and distributions issued as an addition to, in redemption of, in renewal or exchange for, in substitution or upon conversion


 










  





3











  













of, or otherwise on account of, any of the foregoing; (f) all certificates and instruments now or hereafter representing or evidencing any of the foregoing; (g) all rights, interests and claims with respect to the foregoing, including under any and all related agreements, instruments and other documents, and (h) all cash and non-cash proceeds of any of the foregoing, in each case whether presently existing or owned or hereafter arising or acquired and wherever located, and as from time to time received or receivable by, or otherwise paid or distributed to or acquired by, any Grantor.


 


“Pledged Collateral Agreements”: as defined in Section 5.22.


 


“Pledged Notes”: all promissory notes listed on Schedule 2 and all other promissory notes issued to or held by any Grantor.


 


“Pledged Stock”: all of the issued and outstanding shares of Capital Stock, whether certificated or uncertificated, of any Grantor’s direct Subsidiaries now or hereafter owned by any such Grantor and including the Capital Stock listed on Schedule 2 hereof (as amended or supplemented from time to time); provided that in no event shall Pledged Stock include any Excluded Assets.


 


“Proceeds”: all “proceeds” as such term is defined in Section 9-102(a)(64) of the New York UCC and, in any event, shall include, without limitation, all dividends or other income from any Investment Property constituting Collateral and all collections thereon or distributions or payments with respect thereto.


 


“Receivable”:  any right to payment for goods sold or leased or for services rendered, whether or not such right is evidenced by an Instrument or Chattel Paper and whether or not it has been earned by performance (including any Account).


 


“Rights to Payment”: any and all of any Grantor’s Accounts and any and all of any Grantor’s rights and claims to the payment or receipt of money or other forms of consideration of any kind in, to and under or with respect to its Chattel Paper, Documents, General Intangibles, Instruments, Investment Property, Letter-of-Credit Rights, Proceeds and Supporting Obligations.


 


“Secured Obligations”: collectively, the “Obligations”, as such term is defined in the Credit Agreement; including, without limitation, the European Guaranty Obligations.


 


“Secured Parties”: means the Administrative Agent, the Issuing Lender, the Swing Line Lender, each Lender and any Qualified Counterparty with whom any Borrower enters into a Specified Swap Agreement.


 


“Trademark License”:  any written agreement which (a) names a Grantor as licensor or licensee and (b) grants to such Grantor any right to use any Trademark, any such agreement referred to on Schedule 6.


 


“Trademarks”: (a) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks, logos, Internet domain names and other source or business identifiers, and all goodwill associated therewith, now existing or hereafter adopted or acquired, all registrations and recordings thereof, and all applications in connection therewith, whether in the U.S. Patent and Trademark Office or in any similar office or agency of the United States, any State thereof or any other country or any political subdivision thereof, or otherwise, and all common-law rights related thereto, including, without limitation, any of the foregoing referred to on Schedule 6, and (b) the right to obtain all renewals thereof.


 










  





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1.2           Other Definitional Provisions.  The rules of interpretation set forth in Section 1.2 of the Credit Agreement are by this reference incorporated herein, mutatis mutandis, as if set forth herein in full.


 


SECTION 2.   Guarantee.


 


2.1           Guarantee.


 


(a)           Each Grantor, including the Borrowers, who has executed this Agreement as of the date hereof, together with each Subsidiary of any Grantor who accedes to this Agreement as a Grantor after the date hereof pursuant to Section 6.12 of the Credit Agreement (each a “Guarantor” and, collectively, the “Guarantors”), hereby, jointly and severally, unconditionally and irrevocably, guarantees to the Administrative Agent, for the ratable benefit of the Secured Parties and their respective successors, indorsees, transferees and assigns, the prompt and complete payment and performance by the Borrowers and the other Loan Parties when due (whether at the stated maturity, by acceleration or otherwise) of the Secured Obligations.  In furtherance of the foregoing, and without limiting the generality thereof, each Guarantor agrees as follows:


 


(i)           each Guarantor’s liability hereunder shall be the immediate, direct, and primary obligation of such Guarantor and shall not be contingent upon the Administrative Agent’s or any Secured Party’s exercise or enforcement of any remedy it or they may have against any Borrower, any other Guarantor, any other Person, or all or any portion of the Collateral; and


 


(ii)           the Administrative Agent may enforce this guaranty notwithstanding the existence of any dispute between any of the Secured Parties and any Borrower or any other Guarantor with respect to the existence of any Event of Default.


 


(b)           Anything herein or in any other Loan Document to the contrary notwithstanding, the maximum liability of each Guarantor hereunder and under the other Loan Documents shall in no event exceed the amount which can be guaranteed by such Guarantor under applicable federal and state laws relating to the insolvency of debtors (after giving effect to the right of contribution established in Section 2.2).


 


(c)           Each Guarantor agrees that the Secured Obligations may at any time and from time to time exceed the amount of the liability of such Guarantor hereunder without impairing the guarantee contained in this Section 2 or affecting the rights and remedies of the Administrative Agent or any other Secured Party hereunder.


 


(d)           The guarantee contained in this Section 2 shall remain in full force and effect until all the Secured Obligations (including, without limitation, the European Guaranty Obligations), shall have been satisfied by payment in full, in cash, no Letter of Credit shall be outstanding, and all of the Commitments are terminated (the “Discharge of Obligations”), notwithstanding that from time to time during the term of the Credit Agreement the outstanding amount of the Secured Obligations under the Credit Agreement may be zero.


 


(e)           No payment made by any Borrower, any Guarantor, any other guarantor or any other Person or received or collected by the Administrative Agent or any other Secured Party from any Borrower, any Guarantor, any other guarantor or any other Person by virtue of any action or proceeding or any setoff or appropriation or application at any time or from time to time in reduction of or in payment of the Secured Obligations shall be deemed to modify, reduce, release or otherwise affect the liability of any Guarantor hereunder which shall, notwithstanding any such payment (other than any payment made by such Guarantor in respect of the Secured Obligations or any payment received or collected from such Guarantor in respect of the Secured Obligations), remain liable for the Secured Obligations up to the


 










  





5











  













maximum liability of such Guarantor hereunder until the Discharge of Obligations.


 


2.2           Right of Contribution.  If in connection with any payment made by any Guarantor hereunder any rights of contribution arise in favor of such Guarantor against one or more other Guarantors, such rights of contribution shall be subject to the terms and conditions of Section 2.3.  The provisions of this Section 2.2 shall in no respect limit the obligations and liabilities of any Guarantor to the Administrative Agent and the other Secured Parties, and each Guarantor shall remain liable to the Administrative Agent and the other Secured Parties for the full amount guaranteed by such Guarantor hereunder.


 


2.3           No Subrogation.  Notwithstanding any payment made by any Guarantor hereunder or any setoff or application of funds of any Guarantor by the Administrative Agent or any other Secured Party, no Guarantor shall be entitled to be subrogated to any of the rights of the Administrative Agent or any other Secured Party against any Borrower or any other Guarantor or any Collateral or guarantee or right of offset held by the Administrative Agent or any other Secured Party for the payment of the Secured Obligations, nor shall any Guarantor seek or be entitled to seek any contribution or reimbursement from any Borrower or any other Guarantor in respect of payments made by such Guarantor hereunder, in each case, until the Discharge of Obligations.  If any amount shall be paid to any Guarantor on account of such subrogation rights at any time prior to the Discharge of Obligations, such amount shall be held by such Guarantor in trust for the Administrative Agent and the other Secured Parties, shall be segregated from other funds of such Guarantor, and shall, forthwith upon receipt by such Guarantor, be turned over to the Administrative Agent in the exact form received by such Guarantor (duly indorsed by such Guarantor to the Administrative Agent, if required), to be applied in such order as set forth in Section 8.3 of the Credit Agreement irrespective of the occurrence or the continuance of any Event of Default.


 


2.4           Amendments, etc. with respect to the Secured Obligations.  Each Guarantor shall remain obligated hereunder notwithstanding that, without any reservation of rights against any Guarantor and without notice to or further assent by any Guarantor, any demand for payment of any of the Secured Obligations made by the Administrative Agent or any other Secured Party may be rescinded by the Administrative Agent or such Secured Party and any of the Secured Obligations continued, and the Secured Obligations, or the liability of any other Person upon or for any part thereof, or any collateral security or guarantee therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, amended, modified, accelerated, compromised, waived, surrendered or released by the Administrative Agent or any other Secured Party, and the Credit Agreement, the other Loan Documents, the Specified Swap Agreements and any other documents executed and delivered in connection therewith may be amended, modified, supplemented or terminated, in whole or in part, as the Administrative Agent (or the Required Lenders or all of the Lenders, as the case may be) may deem advisable from time to time, and any collateral security, guarantee or right of offset at any time held by the Administrative Agent or any other Secured Party for the payment of the Secured Obligations may be sold, exchanged, waived, surrendered or released.  Neither the Administrative Agent nor any other Secured Party shall have any obligation to protect, secure, perfect or insure any Lien at any time held by it as security for the Secured Obligations or for the guarantee contained in this Section 2 or any property subject thereto.


 


2.5           Guarantee Absolute and Unconditional; Guarantor Waivers; Guarantor Consents.  Each Guarantor waives any and all notice of the creation, renewal, extension or accrual of any of the Secured Obligations and notice of or proof of reliance by the Administrative Agent or any other Secured Party upon the guarantee contained in this Section 2 or acceptance of the guarantee contained in this Section 2; the Secured Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the guarantee contained in this Section 2; and all dealings between the Borrowers and any of the Guarantors on the one hand, and the Administrative Agent and the other Secured Parties, on the other hand, likewise shall be conclusively


 










  





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presumed to have been had or consummated in reliance upon the guarantee contained in this Section 2.  Each Guarantor further waives:


 


(a)           diligence, presentment, protest, demand for payment and notice of default or nonpayment to or upon any Borrower or any of the other Guarantors with respect to the Secured Obligations;


 


(b)           any right to require any Secured Party to marshal assets in favor of any Borrower, such Guarantor, any other Guarantor or any other Person, to proceed against any Borrower, any other Guarantor or any other Person, to proceed against or exhaust any of the Collateral, to give notice of the terms, time and place of any public or private sale of personal property security constituting the Collateral or other collateral for the Secured Obligations or to comply with any other provisions of Section 9-611 of the New York UCC (or any equivalent provision of any other applicable law) or to pursue any other right, remedy, power or privilege of any Secured Party whatsoever;


 


(c)           the defense of the statute of limitations in any action hereunder or for the collection or performance of the Secured Obligations;


 


(d)           any defense arising by reason of any lack of corporate or other authority or any other defense of any Borrower, such Guarantor or any other Person;


 


(e)           any defense based upon the Administrative Agent’s or any Secured Party’s errors or omissions in the administration of the Secured Obligations;


 


(f)           any rights to set-offs and counterclaims;


 


(g)           any defense based upon an election of remedies (including, if available, an election to proceed by nonjudicial foreclosure) which destroys or impairs the subrogation rights of such Guarantor or the right of such Guarantor to proceed against any Borrower or any other obligor of the Secured Obligations for reimbursement; and


 


(h)           without limiting the generality of the foregoing, to the fullest extent permitted by law, any defenses or benefits that may be derived from or afforded by applicable law that limit the liability of or exonerate guarantors or sureties, or which may conflict with the terms of this Agreement.


 


Each Guarantor understands and agrees that the guarantee contained in this Section 2 shall be construed as a continuing, absolute and unconditional guarantee of payment without regard to (i) the validity or enforceability of the Credit Agreement or any other Loan Document, any of the Secured Obligations or any other collateral security therefor or guarantee or right of offset with respect thereto at any time or from time to time held by the Administrative Agent or any other Secured Party, (ii) any defense, setoff or counterclaim (other than a defense of payment or performance) which may at any time be available to or be asserted by the Borrowers or any other Person against the Administrative Agent or any other Secured Party, (iii) any other circumstance whatsoever (with or without notice to or knowledge of any Borrower or such Guarantor) which constitutes, or might be construed to constitute, an equitable or legal discharge of any Borrower and the Guarantors for the Secured Obligations, or of such Guarantor under the guarantee contained in this Section 2, in bankruptcy or in any other instance, (iv) any Insolvency Proceeding with respect to any Borrower, any Guarantor or any other Person, (v) any merger, acquisition, consolidation or change in structure of any Borrower, any Guarantor or any other Person, or any sale, lease, transfer or other disposition of any or all of the assets or Voting Stock of any Borrower, any Guarantor or any other Person, (vi) any assignment permitted pursuant to Section 10.6 of the Credit Agreement, of any Secured Party’s interests in and rights under this Guaranty or the other Loan Documents, including any Secured Party’s right to receive payment of the Secured Obligations, or any assignment permitted pursuant to Section 10.6 of the Credit Agreement, of any Secured Party’s interests


 










  





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in and to any of the Collateral, (vi) any Secured Party’s vote, claim, distribution, election, acceptance, action or inaction in any Insolvency Proceeding related to any of the Secured Obligations, and (vii) any other guaranty, whether by such Guarantor or any other Person, of all or any part of the Secured Obligations or any other indebtedness, obligations or liabilities of any Guarantor to any Secured Party.


 


When making any demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor, the Administrative Agent or any other Secured Party may, but shall be under no obligation to make a similar demand on or otherwise pursue such rights and remedies as it may have against any Borrower, any other Guarantor or any other Person or against any collateral security or guarantee for the Secured Obligations or any right of offset with respect thereto.  Any failure by the Administrative Agent or any other Secured Party to make any such demand, to pursue such other rights or remedies or to collect any payments from any Borrower, any other Guarantor or any other Person or to realize upon any such collateral security or guarantee or to exercise any such right of offset, or any release of any Borrower, any other Guarantor or any other Person or any such collateral security, guarantee or right of offset, shall not relieve any Guarantor of any obligation or liability hereunder, and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of law, of the Administrative Agent or any other Secured Party against any Guarantor.  For the purposes hereof “demand” shall include the commencement and continuance of any legal proceedings.


 


Each Guarantor further unconditionally consents and agrees that, without notice to or further assent from any Guarantor: (a) the principal amount of the Secured Obligations may be increased or decreased and additional indebtedness or obligations of the Borrowers or any other Persons under the Loan Documents may be incurred, by one or more amendments, modifications, renewals or extensions of any Loan Document or otherwise; (b) the time, manner, place or terms of any payment under any Loan Document may be extended or changed, including by an increase or decrease in the interest rate on any Secured Obligation or any fee or other amount payable under such Loan Document, by an amendment, modification or renewal of any Loan Document or otherwise; (c) the time for the Borrowers’ (or any other Loan Party’s) performance of or compliance with any term, covenant or agreement on its part to be performed or observed under any Loan Document may be extended, or such performance or compliance waived, or failure in or departure from such performance or compliance consented to, all in such manner and upon such terms as the Administrative Agent may deem proper; (d) in addition to the Collateral, the Secured Parties may take and hold other security (legal or equitable) of any kind, at any time, as collateral for the Secured Obligations, and may, from time to time, in whole or in part, exchange, sell, surrender, release, subordinate, modify, waive, rescind, compromise or extend such security and may permit or consent to any such action or the result of any such action, and may apply such security and direct the order or manner of sale thereof; (e) any Secured Party may discharge or release, in whole or in part, any other Guarantor or any other Loan Party or other Person liable for the payment and performance of all or any part of the Secured Obligations, and may permit or consent to any such action or any result of such action, and shall not be obligated to demand or enforce payment upon any of the Collateral, nor shall any Secured Party be liable to any Guarantor for any failure to collect or enforce payment or performance of the Secured Obligations from any Person or to realize upon the Collateral, and (f) the Secured Parties may request and accept other guaranties of the Secured Obligations and any other indebtedness, obligations or liabilities of the Borrowers or any other Loan Party to any Secured Party and may, from time to time, in whole or in part, surrender, release, subordinate, modify, waive, rescind, compromise or extend any such guaranty and may permit or consent to any such action or the result of any such action; in each case (a) through (f), as the Secured Parties may deem advisable, and without impairing, abridging, releasing or affecting this Agreement.


 


2.6           Reinstatement.  The guarantee contained in this Section 2 shall continue to be effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of any of the Secured Obligations is rescinded or must otherwise be restored or returned by the Administrative Agent or any 


 










  





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other Secured Party upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of any Borrower or any Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, any Borrower or any such Guarantor or any substantial part of its respective property, or otherwise, all as though such payments had not been made.


 


2.7           Payments.  Each Guarantor hereby guarantees that payments hereunder will be paid to the Administrative Agent without setoff or counterclaim in Dollars at the Funding Office.


 


SECTION 3.    GRANT OF SECURITY INTEREST


 


3.1           Grant of Security Interests.  Each Grantor hereby grants to the Administrative Agent, for the ratable benefit of the Secured Parties, a security interest in all of the following property now owned or at any time hereafter acquired by such Grantor or in which such Grantor now has or at any time in the future may acquire any right, title or interest and wherever located (collectively, the “Collateral”), as collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of the Secured Obligations (including, without limitation, Obligations arising under the European Loan Agreement):


 


(a)           all Accounts;


 


(b)           all Chattel Paper;


 


(c)           all Commercial Tort Claims;


 


(d)           all Deposit Accounts;


 


(e)           all Documents;


 


(f)           all Equipment;


 


(g)           all Fixtures;


 


(h)           all General Intangibles;


 


(i)           all Goods;


 


(j)           all Instruments;


 


(k)           all Intellectual Property;


 


(l)           all Inventory;


 


(m)           all Investment Property (including all Pledged Collateral);


 


(n)           all Letter-of-Credit Rights;


 


(o)           all Money;


 


(p)           all Books and records pertaining to the Collateral


 


(q)           all other property not otherwise described above; and


 










  





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(r)           to the extent not otherwise included, all Proceeds, Supporting Obligations and products of any and all of the foregoing; provided, however, that notwithstanding anything to the contrary contained in clauses (a) through (q) above, the security interests created by this Agreement shall not extend to, and the term “Collateral” (including all of the individual items comprising Collateral) shall not include, any Excluded Assets.


 


Notwithstanding any of the other provisions set forth in this Section 3, this Agreement shall not constitute a grant of a security interest in any property to the extent that such grant of a security interest is prohibited by any Requirement of Law of a Governmental Authority or constitutes a breach or default under or results in the termination of or requires any consent not obtained under, any contract, license, agreement, instrument or other document evidencing or giving rise to such property, except (i) to the extent that the terms in such contract, license, instrument or other document providing for such prohibition, breach, default or termination, or requiring such consent are not permitted under the terms and conditions of the Credit Agreement or (ii) to the extent that such Requirement of Law or the term in such contract, license, agreement, instrument or other document providing for such prohibition, breach, default or termination or requiring such consent is ineffective under Section 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdiction or any other applicable law (including the Bankruptcy Code) or principles of equity; provided, however, that such security interest shall attach immediately at such time as such Requirement of Law is not effective or applicable, or such prohibition, breach, default or termination is no longer applicable or is waived, and to the extent severable, shall attach immediately to any portion of the Collateral that does not result in such consequences; and provided, further, that no United States intent-to-use trademark or service mark application shall be included in the Collateral to the extent that, and solely during the period in which, the grant of a security interest therein would impair the validity or enforceability of such intent-to-use trademark or service mark application under Federal law.  After such period, each Grantor acknowledges that such interest in such trademark or service mark application shall be subject to a security interest in favor of the Administrative Agent and shall be included in the Collateral.


 


3.2           Grantors Remains Liable.  Anything herein to the contrary notwithstanding, (a) each Grantor shall remain liable under any contracts, agreements and other documents included in the Collateral, to the extent set forth therein, to perform all of its duties and obligations thereunder to the same extent as if this Agreement had not been executed, (b) the exercise by the Administrative Agent of any of the rights granted to the Administrative Agent hereunder shall not release any Grantor from any of its duties or obligations under any such contracts, agreements and other documents included in the Collateral, and (c) neither the Administrative Agent nor any other Secured Party shall have any obligation or liability under any such contracts, agreements and other documents included in the Collateral by reason of this Agreement, nor shall the Administrative Agent or any other Secured Party be obligated to perform any of the obligations or duties of any Grantor thereunder or to take any action to collect or enforce any such contract, agreement or other document included in the Collateral hereunder.


 


3.3           Perfection and Priority.


 


(a)           Financing Statements.  Pursuant to any applicable law, each Grantor authorizes the Administrative Agent (and its counsel and its agents) to file or record at any time and from time to time any financing statements and other filing or recording documents or instruments with respect to the Collateral and each Grantor shall execute and deliver to the Administrative Agent and each Grantor hereby authorizes the Administrative Agent (and its counsel and its agents) to file (with or without the signature of such Grantor) at any time and from time to time, all amendments to financing statements, continuation financing statements, termination statements, security agreements relating to the Intellectual Property, assignments, fixture filings, affidavits, reports notices and all other documents and instruments, in such form and in such offices as the Administrative Agent or the Required Lenders determine appropriate to perfect and continue perfected, maintain the priority of or provide notice of the


 










  





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Administrative Agent’s security interest in the Collateral under and to accomplish the purposes of this Agreement.  Each Grantor authorizes the Administrative Agent to use the collateral description “all personal property, whether now owned or hereafter acquired” or any other similar collateral description in any such financing statements.  Each Grantor hereby ratifies and authorizes the filing by the Administrative Agent (and its counsel and its agents) of any financing statement with respect to the Collateral made prior to the date hereof.


 


(b)           Transfer of Security Interest Other Than by Delivery.  If for any reason Pledged Collateral cannot be delivered to or for the account of the Administrative Agent as provided in Section 5.6(b), each applicable Grantor shall promptly take such other steps as may be necessary or as shall be reasonably requested from time to time by the Administrative Agent to effect a transfer of a perfected first priority security interest in and pledge of the Pledged Collateral to the Administrative Agent for itself and on behalf of and for the ratable benefit of the other Secured Parties pursuant to the UCC.  To the extent practicable, each such Grantor shall thereafter deliver the Pledged Collateral to or for the account of the Administrative Agent as provided in Section 5.6(b).


 


(c)           Intellectual Property.  (i)  Each Grantor shall, in addition to executing and delivering this Agreement, take such other action as may be necessary, or as the Administrative Agent may reasonably request, to perfect the Administrative Agent’s security interest in the Intellectual Property.  (ii) Promptly following the creation or other acquisition of any Intellectual Property by any Grantor after the date hereof which is registered or becomes registered or the subject of an application for registration with the U.S. Copyright Office or the U.S. Patent and Trademark Office, as applicable, such Grantor shall modify this Agreement by amending Schedule 6 to include any Intellectual Property which becomes part of the Collateral and which was not included on Schedule 6 as of the date hereof and record an amendment to this Agreement with the U.S. Copyright Office or the U.S. Patent and Trademark Office, as applicable, and take such other action as may be necessary, or as the Administrative Agent or the Required Lenders may reasonably request, to perfect the Administrative Agent’s security interest in such Intellectual Property.


 


(d)           Bailees.  Any Person (other than the Administrative Agent) at any time and from time to time holding all or any portion of the Collateral shall be deemed to, and shall, hold the Collateral as the agent of, and as pledge holder for, the Administrative Agent.  At any time and from time to time, the Administrative Agent may give notice to any such Person holding all or any portion of the Collateral that such Person is holding the Collateral as the agent and bailee of, and as pledge holder for, the Administrative Agent, and obtain such Person’s written acknowledgment thereof.  Without limiting the generality of the foregoing, each Grantor will join with the Administrative Agent in notifying any Person who has possession of any Collateral of the Administrative Agent’s security interest therein and shall use commercially reasonable efforts to obtain an acknowledgment from such Person that it is holding the Collateral for the benefit of the Administrative Agent.


 


(e)           Control.  Each Grantor will cooperate with the Administrative Agent in obtaining control (as defined in the UCC) of Collateral consisting of any Deposit Accounts, Electronic Chattel Paper, Investment Property or Letter-of-Credit Rights, including delivery of control agreements, as the Administrative Agent may reasonably request, to perfect and continue perfected, maintain the priority of or provide notice of the Administrative Agent’s security interest in such Collateral.


 


(f)           Additional Subsidiaries.  In the event that any Grantor acquires rights in any Subsidiary (other than a Foreign Subsidiary which is not a Material First Tier Foreign Subsidiary) after the date hereof, it shall deliver to the Administrative Agent a completed pledge supplement, substantially in the form of Annex 2 (the “Pledge Supplement”), together with all schedules thereto, reflecting the pledge of the Capital Stock of such new Subsidiary (except to the extent such Capital Stock consists of Excluded Assets).  Notwithstanding the foregoing, it is understood and agreed that the security interest of


 










  





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the Administrative Agent shall attach to the Pledged Collateral related to such Subsidiary immediately upon any Grantor’s acquisition of rights therein and shall not be affected by the failure of any Grantor to deliver a Pledge Supplement.


 


SECTION 4.    REPRESENTATIONS AND WARRANTIES


 


In addition to the representations and warranties of the Grantors set forth in the Credit Agreement, which are incorporated herein by this reference, and to induce the Administrative Agent and the Lenders to enter into the Credit Agreement and to induce the Lenders to make their respective extensions of credit to the Borrowers thereunder, each Grantor hereby represents and warrants to the Administrative Agent and each other Secured Party that:


 


4.1           Title; No Other Liens.  Except for the Liens permitted to exist on the Collateral by Section 7.3 of the Credit Agreement, such Grantor owns each item of the Collateral in which a Lien is granted by it free and clear of any and all Liens and other claims of others.  No financing statement, fixture filing or other public notice with respect to all or any part of the Collateral is on file or of record or will be filed in any public office, except such as have been filed as permitted by the Credit Agreement.  For the avoidance of doubt, it is understood and agreed that each Grantor may, as part of its business, grant licenses to third parties to use Intellectual Property owned or developed by such Grantor.  For purposes of this Agreement and the other Loan Documents, such licensing activity shall not constitute a “Lien” on such Intellectual Property.  The Administrative Agent and each other Secured Party understands that any such licenses may be exclusive to the applicable licensees, and such exclusivity provisions may limit the ability of the Administrative Agent to utilize, sell, lease or transfer the related Intellectual Property or otherwise realize value from such Intellectual Property pursuant hereto.


 


4.2           Perfected Liens.  The security interests granted to the Administrative Agent pursuant to this Agreement (a) upon completion of the filings and other actions specified on Schedule 3 (which, in the case of all filings and other documents referred to on said Schedule, have been delivered to the Administrative Agent in completed and duly (if applicable) executed form) will constitute valid perfected security interests in all of the Collateral in favor of the Administrative Agent, for the ratable benefit of the Secured Parties, as collateral security for the Secured Obligations, enforceable in accordance with the terms hereof against any creditors of any Grantor and any Persons purporting to purchase any Collateral from any Grantor, and (ii) are prior to all other Liens on the Collateral in existence on the date hereof except for Liens permitted by the Credit Agreement which have priority over the Liens of the Administrative Agent on the Collateral (for the ratable benefit of the Secured Parties) by operation of law, and in the case of Collateral other than Pledged Collateral, Liens permitted by Section 7.3 of the Credit Agreement.  Unless an Event of Default has occurred and is continuing, each Grantor has the right to remove the Fixtures in which such Grantor has an interest within the meaning of Section 9-334(f)(2) of the UCC.


 


4.3           Jurisdiction of Organization; Chief Executive Office and Locations of Books.  On the date hereof, such Grantor’s jurisdiction of organization, identification number from the jurisdiction of organization (if any), and the location of such Grantor’s chief executive office or sole place of business, as the case may be, are specified on Schedule 4.  All locations where Books pertaining to the Rights to Payment of such Grantor are kept, including all equipment necessary for accessing such Books and the names and addresses of all service bureaus, computer or data processing companies and other Persons keeping any Books or collecting Rights to Payment for such Grantor, are set forth in Schedule 4.


 


4.4           Inventory and Equipment.  On the date hereof (a) the Inventory and (b) the Equipment (other than mobile goods) are kept at the locations listed on Schedule 5.


 


4.5           Farm Products.  None of the Collateral constitutes, or is the Proceeds of, Farm Products.


 










  





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4.6           Pledged Collateral.  (a) All of the Pledged Stock held by such Grantor has been duly and validly issued, and is fully paid and non-assessable, subject in the case of Pledged Stock constituting partnership interests or limited liability company membership interests to future assessments required under applicable law and any applicable partnership or operating agreement, (b) such Grantor is or, in the case of any such additional Pledged Collateral will be, the legal record and beneficial owner thereof, (c) in the case of Pledged Stock of a Subsidiary of such Grantor or Pledged Collateral of such Grantor constituting Instruments issued by a Subsidiary of such Grantor, there are no restrictions on the transferability of such Pledged Collateral or such additional Pledged Collateral to the Administrative Agent or with respect to the foreclosure, transfer or disposition thereof by the Administrative Agent, except as provided under applicable securities or “Blue Sky” laws, (d) the Pledged Stock pledged by such Grantor constitute all of the issued and outstanding shares of Capital Stock of each Issuer owned by such Grantor (except for Excluded Assets), and such Grantor owns no securities convertible into or exchangeable for any shares of Capital Stock of any such Issuer that do not constitute Pledged Stock hereunder, (e) any and all Pledged Collateral Agreements which affect or relate to the voting or giving of written consents with respect to any of the Pledged Stock pledged by such Grantor have been disclosed to the Administrative Agent, and (f) as to each such Pledged Collateral Agreement relating to the Pledged Stock pledged by such Grantor, (i) to the best knowledge of such Grantor, such Pledged Collateral Agreement contains the entire agreement between the parties thereto with respect to the subject matter thereof and is in full force and effect in accordance with its terms, (ii) to the best knowledge of such Grantor party thereto, there exists no material violation or material default under any such Pledged Collateral Agreement by such Grantor or the other parties thereto, and (iii) such Grantor has not knowingly waived or released any of its material rights under or otherwise consented to a material departure from the terms and provisions of any such Pledged Collateral Agreement.


 


4.7           Investment Accounts.  Schedule 2 sets forth under the headings “Securities Accounts” and “Commodity Accounts”, respectively, all of the Securities Accounts and Commodity Accounts in which such Grantor has an interest.  Except as disclosed to the Administrative Agent, such Grantor is the sole entitlement holder of each such Securities Account and Commodity Account, and such Grantor has not consented to, and is not otherwise aware of, any Person (other than the Administrative Agent) having “control” (within the meanings of Sections 8-106 and 9-106 of the UCC) over, or any other interest in, any such Securities Account or Commodity Account or any securities or other property credited thereto;


 


(a)           Schedule 2 sets forth under the heading “Deposit Accounts” all of the Deposit Accounts in which such Grantor has an interest and, except as otherwise disclosed to the Administrative Agent, such Grantor is the sole account holder of each such Deposit Account and such Grantor has not consented to, and is not otherwise aware of, any Person (other than the Administrative Agent) having either sole dominion and control (within the meaning of common law) or “control” (within the meaning of Section 9-104 of the UCC) over, or any other interest in, any such Deposit Account or any money or other property deposited therein; and


 


(b)           In each case to the extent requested by the Administrative Agent, such Grantor has taken all actions necessary or desirable to: (i) establish the Administrative Agent’s “control” (within the meanings of Sections 8-106 and 9-106 of the UCC) over any Certificated Securities (as defined in Section 9-102 of the UCC); (ii) establish the Administrative Agent’s “control” (within the meanings of Sections 8106 and 9106 of the UCC) over any portion of the Investment Accounts constituting Securities Accounts, Commodity Accounts, Securities Entitlements or Uncertificated Securities (each as defined in Section 9-102 of the UCC); (iii) establish the Administrative Agent’s “control” (within the meaning of Section 9-104 of the UCC) over all Deposit Accounts; and (iv) deliver all Instruments (as defined in Section 9-102 of the UCC) to the Administrative Agent to the extent required hereunder.


 


4.8           Receivables.   No amount payable to such Grantor under or in connection with any Receivable or other Right to Payment is evidenced by any Instrument (other than checks, drafts or other


 










  





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Instruments that will be promptly deposited in an Investment Account) or Chattel Paper which has not been delivered to the Administrative Agent.  None of the account debtors or other obligors in respect of any Receivable in excess of $100,000 in the aggregate is the government of the United States or any agency or instrumentality thereof.


 


4.9           Intellectual Property.  Schedule 6 lists all registrations and applications for Intellectual Property (including registered Copyrights, Patents, Trademarks and all applications therefor) as well as all Copyright Licenses, Patent Licenses and Trademark Licenses, in each case owned by such Grantor in its own name on the date hereof.  Except as set forth in Schedule 6, on the date hereof, none of the Intellectual Property is the subject of any licensing or franchise agreement pursuant to which such Grantor is the licensor or franchisor.


 


4.10           Instruments.  (i) Such Grantor has not previously assigned any interest in any Instruments (including but not limited to the Pledged Notes) held by such Grantor (other than such interests as will be released on or before the date hereof), and (ii) no Person other than such Grantor owns an interest in such Instruments (whether as joint holders, participants or otherwise).


 


4.11           Letter of Credit Rights.  Such Grantor does not have any Letter-of-Credit Rights except as set forth in Schedule 7 or as have been notified to the Administrative Agent in accordance with Section 5.21.


 


4.12           Commercial Tort Claims.  Such Grantor does not have any Commercial Tort Claims except as set forth in Schedule 8 or as have been notified to the Administrative Agent in accordance with Section 5.20.


 


SECTION 5.    COVENANTS


 


In addition to the covenants of the Grantors set forth in the Credit Agreement, which are incorporated herein by this reference, each Grantor covenants and agrees with the Administrative Agent and the other Secured Parties that, from and after the date of this Agreement until the Discharge of Obligations:


 


5.1           Delivery of Instruments, Certificated Securities and Chattel Paper.  If any amount payable under or in connection with any of the Collateral shall be or become evidenced by any Instrument (other than checks, drafts or other Instruments that will be promptly deposited in an Investment Account), Certificated Security or Chattel Paper evidencing an amount in excess of $100,000, such Instrument, Certificated Security or Chattel Paper shall be promptly delivered to the Administrative Agent, duly indorsed in a manner satisfactory to the Administrative Agent, to be held as Collateral pursuant to this Agreement.


 


5.2           Maintenance of Insurance.


 


(a)           Such Grantor will maintain, with financially sound and reputable companies, insurance policies (i) insuring the Inventory and Equipment against loss by fire, explosion, theft and such other casualties as may be reasonably satisfactory to the Administrative Agent and (ii) insuring such Grantor, the Administrative Agent and the other Secured Parties against liability for personal injury and property damage relating to such Inventory and Equipment, such policies to be in such form and amounts and having such coverage as may be reasonably satisfactory to the Administrative Agent and the other Secured Parties.


 


(b)           All such insurance shall (i) provide that no cancellation, material reduction in amount or material change in coverage thereof shall be effective until at least thirty (30) days after receipt


 










  





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by the Administrative Agent of written notice thereof, (ii) name the Administrative Agent as an additional insured party or loss payee, (iii) to the extent available on commercially reasonable terms, and if reasonably requested by the Administrative Agent, include a breach of warranty clause and (iv) be reasonably satisfactory in all other respects to the Administrative Agent.


 


(c)           The Borrowers shall deliver to the Administrative Agent a report of a reputable insurance broker with respect to such insurance substantially concurrently with each delivery of the Borrowers’ audited annual financial statements and such supplemental reports with respect thereto as the Administrative Agent may from time to time reasonably request.


 


5.3           Maintenance of Perfected Security Interest; Further Documentation.


 


(a)           Such Grantor shall maintain the security interests of the Administrative Agent (for the benefit of the Secured Parties) created by this Agreement as perfected security interests having at least the priority described in Section 4.2 and shall defend such security interests against the claims and demands of all Persons whomsoever, subject to the rights of such Grantor under the Loan Documents to dispose of the Collateral.


 


(b)           Such Grantor will furnish to the Administrative Agent from time to time statements and schedules further identifying and describing the assets and property of such Grantor and such other reports in connection therewith as the Administrative Agent may reasonably request, all in reasonable detail.


 


(c)           At any time and from time to time, upon the written request of the Administrative Agent, and at the sole expense of such Grantor, such Grantor will promptly and duly execute and deliver, and have recorded, such further instruments and documents and take such further actions as the Administrative Agent may reasonably request for the purpose of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted, including, without limitation, (i) filing any financing or continuation statements under the Uniform Commercial Code (or other similar laws) in effect in any jurisdiction with respect to the security interests created hereby and (ii) in the case of Investment Property, Investment Accounts, Letter-of-Credit Rights and any other relevant Collateral, taking any actions necessary to enable the Administrative Agent to obtain “control” (within the meaning of the UCC) with respect thereto to the extent required hereunder.


 


5.4           Changes in Locations, Name, Etc.  Such Grantor will not, except upon fifteen (15) days’ (or such shorter period as may be agreed to by the Administrative Agent) prior written notice to the Administrative Agent and delivery to the Administrative Agent of (a) all additional executed financing statements and other documents reasonably requested by the Administrative Agent to maintain the validity, perfection and priority of the security interests provided for herein, and (b) if applicable, a written supplement to Schedule 4 showing the relevant new jurisdiction of organization, location of chief executive office or sole place of business, as appropriate:


 


(i)           change its jurisdiction of organization, identification number from the jurisdiction of organization (if any) or the location of its chief executive office or sole place of business, as appropriate, from that referred to in Section 4.3;


 


(ii)           change its name; or


 


(iii)           locate any Collateral in any state or other jurisdiction other than those in which such Grantor operates as of the Closing Date.


 










  





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5.5           Notices.  Such Grantor will advise the Administrative Agent promptly, in reasonable detail, of:


 


(a)           any Lien (other than Liens permitted under Section 7.3 of the Credit Agreement) on any of the Collateral; and


 


(b)           the occurrence of any other event which could reasonably be expected to have a material adverse effect on the aggregate value of the Collateral or on the security interests created hereby.


 


5.6           Instruments; Investment Property.


 


(a)           Upon the request of the Administrative Agent, such Grantor will (i) immediately deliver to the Administrative Agent, or an agent designated by it, appropriately endorsed or accompanied by appropriate instruments of transfer or assignment, all Instruments, Documents, Chattel Paper and certificated securities with respect to any Investment Property held by such Grantor, all letters of credit of such Grantor, and all other Rights to Payment held by such Grantor at any time evidenced by promissory notes, trade acceptances or other instruments, and (ii) provide such notice, obtain such acknowledgments and take all such other action, with respect to any Chattel Paper, Documents and Letter-of-Credit Rights held by such Grantor, as the Administrative Agent shall reasonably specify.


 


(b)           If such Grantor shall become entitled to receive or shall receive any certificate (including any certificate representing a dividend or a distribution in connection with any reclassification, increase or reduction of capital or any certificate issued in connection with any reorganization), option or rights in respect of the Capital Stock of any Issuer, whether in addition to, in substitution of, as a conversion of, or in exchange for, any Pledged Collateral, or otherwise in respect thereof, such Grantor shall accept the same as the agent of the Administrative Agent and the other Secured Parties, hold the same in trust for the Administrative Agent and the other Secured Parties and deliver the same forthwith to the Administrative Agent in the exact form received, duly indorsed by such Grantor to the Administrative Agent, if required, together with an undated stock power covering such certificate duly executed in blank by such Grantor and with, if the Administrative Agent so requests, signature guaranteed, to be held by the Administrative Agent, subject to the terms hereof, as additional collateral security for the Secured Obligations; provided that in no event shall this Section 5.6(b) apply to any Excluded Assets.  Any sums paid upon or in respect of the Investment Property upon the liquidation or dissolution of any Issuer shall, unless otherwise subject to a perfected security interest in favor of the Administrative Agent, be paid over to the Administrative Agent to be held by it hereunder as additional collateral security for the Secured Obligations, and in case any distribution of capital shall be made on or in respect of the Investment Property or any property shall be distributed upon or with respect to the Investment Property pursuant to the recapitalization or reclassification of the capital of any Issuer or pursuant to the reorganization thereof, the property so distributed shall, unless otherwise subject to a perfected security interest in favor of the Administrative Agent, be delivered to the Administrative Agent to be held by it hereunder as additional collateral security for the Secured Obligations.  If any sums of money or property so paid or distributed in respect of such Investment Property shall be received by such Grantor, such Grantor shall, until such money or property is paid or delivered to the Administrative Agent, unless otherwise subject to a perfected security interest in favor of the Administrative Agent, hold such money or property in trust for the Administrative Agent and the other Secured Parties, segregated from other funds of such Grantor, as additional collateral security for the Secured Obligations.


 


(c)           In the case of any Grantor which is an Issuer, such Issuer agrees that (i) it will be bound by the terms of this Agreement relating to the Capital Stock issued by it and will comply with such terms insofar as such terms are applicable to it, (ii) it will notify the Administrative Agent promptly in writing of the occurrence of any of the events described in Section 5.6(a) and (b) with respect to the Pledged Collateral issued by it and (iii) the terms of Sections 6.3(c) and 6.7 shall apply to it, mutatis


 










  





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mutandis, with respect to all actions that may be required of it pursuant to Section 6.3(c) or 6.7 with respect to the Capital Stock issued by it.


 


5.7           Securities Accounts; Deposit Accounts.


 


(a)           With respect to any Securities Account, such Grantor shall cause any applicable securities intermediary maintaining such Securities Account to show on its books that the Administrative Agent is the entitlement holder with respect to such Securities Account, and, if requested by the Administrative Agent, cause such securities intermediary to enter into an agreement in form and substance satisfactory to the Administrative Agent with respect to such Securities Account pursuant to which such securities intermediary shall agree to comply with the Administrative Agent’s “entitlement orders” without further consent by such Grantor, as requested by the Administrative Agent; and


 


(b)           with respect to any Deposit Account, such Grantor shall enter into and shall cause the depositary institution maintaining such account to enter into an agreement in form and substance reasonably satisfactory to the Administrative Agent pursuant to which the Administrative Agent shall be granted “control” (within the meaning of Section 9-104 of the UCC) over such Deposit Account.


 


(c)           The Administrative Agent agrees that it will only communicate “entitlement orders” with respect to the Deposit Accounts and Securities Accounts of the Grantors after the occurrence and during the continuance of an Event of Default.


 


(d)           Such Grantor shall give the Administrative Agent immediate notice of the establishment of any new Deposit Account and of any new Securities Account established by such Grantor with respect to any Investment Property held by such Grantor.


 


5.8           Intellectual Property.


 


(a)           Such Grantor (either itself or through licensees) will (i) continue to use each material Trademark in order to maintain such material Trademark in full force free from any claim of abandonment for non-use, (ii) maintain as in the past the quality of products and services offered under each such material Trademark, (iii) use each such material Trademark with the appropriate notice of registration and all other notices and legends required by applicable Requirements of Law, (iv) not adopt or use any mark which is confusingly similar or a colorable imitation of any such material Trademark unless the Administrative Agent, for the ratable benefit of the Secured Parties, shall obtain, to the extent available, a perfected security interest in such mark pursuant to this Agreement, and (v) not (and not knowingly permit any licensee or sublicensee thereof to) do any act or knowingly omit to do any act whereby any such material Trademark may become invalidated or impaired in any way.


 


(b)           Such Grantor (either itself or through licensees) will not do any act, or omit to do any act, whereby any material Patent may become forfeited, abandoned or dedicated to the public.


 


(c)           Such Grantor (either itself or through licensees) will not (and will not permit any licensee or sublicensee thereof to) do any act or knowingly omit to do any act whereby any such material Copyrights may become invalidated or otherwise impaired.  Such Grantor will not (either itself or through licensees) do any act whereby any material portion of such Copyrights may fall into the public domain.


 


(d)           Such Grantor (either itself or through licensees) will not do any act that knowingly uses any material Intellectual Property to infringe the intellectual property rights of any other Person.


 










  





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(e)           Such Grantor will notify the Administrative Agent promptly if it knows, or has reason to know, that any application or registration relating to any material Intellectual Property may become forfeited, abandoned or dedicated to the public, or of any material adverse determination or development (including, without limitation, the institution of, or any such determination or development in, any proceeding in the United States Patent and Trademark Office, the United States Copyright Office or any court or tribunal in any country) regarding such Grantor’s ownership of, or the validity of, any material Intellectual Property or such Grantor’s right to register the same or to own and maintain the same.


 


(f)           Whenever such Grantor, either by itself or through any agent, employee, licensee or designee, shall file an application for the registration of any Patent or Trademark with the U.S. Patent and Trademark Office or any similar office or agency in any other country or political subdivision thereof, such Grantor shall report (i) the initial application to and (ii) the corresponding grant, if any, of the Patent or Trademark from the U.S. Patent and Trademark Office to the Administrative Agent, each within forty-five (45) days after the last day of the fiscal quarter in which such filing or grant, as applicable, occurs.  Whenever such Grantor, either by itself or through any agent, employee, licensee or designee, shall file an application for the registration of any Copyright with the U.S. Copyright Office, such Grantor shall report the filing of the initial application to the Administrative Agent not less than fourteen (14) days prior to such filing.  Upon request of the Administrative Agent, other than in respect of intent-to-use trademark or service mark applications, such Grantor shall execute and deliver, and have recorded, any and all agreements, instruments, documents, and papers as the Administrative Agent may reasonably request to evidence the Administrative Agent’s and the other Secured Parties’ security interest in any Copyright, Patent or Trademark and the goodwill and general intangibles of such Grantor relating thereto or represented thereby.


 


(g)           Such Grantor will take all reasonable and necessary steps, including, without limitation, in any proceeding before the U.S. Patent and Trademark Office, the U.S. Copyright Office or any similar office or agency in any other country or any political subdivision thereof, to maintain and pursue each material application (and to obtain the relevant registration) and to maintain each registration of the material U.S. Intellectual Property, including filing of applications for renewal, affidavits of use and affidavits of incontestability.


 


(h)           In the event that any material Intellectual Property is infringed, misappropriated or diluted by a third party, such Grantor shall take such actions as such Grantor shall reasonably deem appropriate under the circumstances to protect such Intellectual Property.


 


5.9           Receivables.  Other than in the ordinary course of business consistent with its past practice, such Grantor will not (a) grant any extension of the time of payment of any Receivable, (b) compromise or settle any Receivable for less than the full amount thereof, (c) release, wholly or partially, any Person liable for the payment of any Receivable, (d) allow any credit or discount whatsoever on any Receivable or (e) amend, supplement or modify any Receivable in any manner that could adversely affect the value thereof.


 


5.10           Defense of Collateral.  Grantors will appear in and defend any action, suit or proceeding which may affect to a material extent its title to, or right or interest in, or the Administrative Agent’s right or interest in, any material portion of the Collateral.


 


5.11           Preservation of Collateral.  Grantors will do and perform all reasonable acts that may be necessary and appropriate to maintain, preserve and protect the Collateral.


 










  





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5.12           Compliance with Laws, Etc. Such Grantor will comply in all material respects with all laws, regulations and ordinances, and all policies of insurance, relating in a material way to the possession, operation, maintenance and control of the Collateral.


 


5.13           Location of Books and Chief Executive Office.  Such Grantor will: (a) keep all Books pertaining to the Rights to Payment of such Grantor at the locations set forth in Schedule 4; and (b) give at least fifteen (15) days’ prior written notice to the Administrative Agent of any changes in any location where Books pertaining to the Rights to Payment of such Grantor are kept, including any change of name or address of any service bureau, computer or data processing company or other Person preparing or maintaining any such Books or collecting Rights to Payment for such Grantor.


 


5.14           Location of Collateral.  Such Grantor will:  (a) keep the Collateral held by such Grantor at the locations set forth in Schedule 5 or at such other locations as may be disclosed in writing to the Administrative Agent pursuant to clause (b) and will not remove any such Collateral from such locations (other than in connection with sales of Inventory in the ordinary course of such Grantor’s business, the movement of Collateral as part of such Grantor’s supply chain and in the ordinary course of such Grantor’s business, other dispositions permitted by Section 5.16 and Section 7.5 of the Credit Agreement and movements of Collateral from one disclosed location to another disclosed location within the United States), except upon at least 15 days’ prior written notice of any removal to the Administrative Agent; and (b) give the Administrative Agent at least fifteen (15) days’ prior written notice of any change in the locations set forth in Schedule 5.


 


5.15           Maintenance of Records.  Such Grantor will keep separate, accurate and complete Books with respect to Collateral held by such Grantor, disclosing the Administrative Agent’s security interest hereunder.


 


5.16           Disposition of Collateral.  Such Grantor will not surrender or lose possession of (other than to the Administrative Agent), sell, lease, rent, or otherwise dispose of or transfer any of the Collateral held by such Grantor or any right or interest therein, except to the extent permitted by the Loan Documents.


 


5.17           Liens.  Such Grantor will keep the Collateral held by such Grantor free of all Liens except Liens permitted under Section 7.3 of the Credit Agreement.


 


5.18           Expenses.  Such Grantor will pay all expenses of protecting, storing, warehousing, insuring, handling and shipping the Collateral held by such Grantor, to the extent the failure to pay any such expenses could reasonably be expected to materially and adversely affect the value of the Collateral.


 


5.19           Leased Premises; Collateral Held by Warehouseman, Bailee, Etc.  At the Administrative Agent’s request, such Grantor will use commercially reasonable efforts to obtain from each Person from whom such Grantor leases any premises, and from each other Person at whose premises any Collateral held by such Grantor is at any time present (including any bailee, warehouseman or similar Person), any such collateral access, subordination, landlord waiver, bailment, consent and estoppel agreements as the Administrative Agent may require, in form and substance satisfactory to the Administrative Agent.


 


5.20           Chattel Paper.  Such Grantor will not create any Chattel Paper without placing a legend on such Chattel Paper acceptable to the Administrative Agent indicating that the Administrative Agent has a security interest in such Chattel Paper.  Such Grantor will give the Administrative Agent immediate notice if such Grantor at any time holds or acquires an interest in any Chattel Paper, including any Electronic Chattel Paper and shall comply, in all respects, with the provisions of Section 5.1 hereof.


 










  





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5.21           Commercial Tort Claims.  Such Grantor will give the Administrative Agent prompt notice if such Grantor shall at any time hold or acquire any Commercial Tort Claim.


 


5.22           Letter-of-Credit Rights.  Such Grantor will give the Administrative Agent prompt notice if such Grantor shall at any time hold or acquire any Letter-of-Credit Rights.


 


5.23           Shareholder Agreements and Other Agreements.


 


(a)           Such Grantor shall comply with all of its obligations under any shareholders agreement, operating agreement, partnership agreement, voting trust, proxy agreement or other agreement or understanding (collectively, the “Pledged Collateral Agreements”) to which it is a party and shall enforce all of its rights thereunder, except, with respect to any such Pledged Collateral Agreement relating to any Pledged Collateral issued by a Person other than a Subsidiary of a Grantor, to the extent the failure to enforce any such rights could reasonably be expected to materially and adversely affect the value of the Pledged Collateral to which any such Pledged Collateral Agreement relates.


 


(b)           Such Grantor agrees that no Pledged Stock (i) shall be dealt in or traded on any securities exchange or in any securities market, (ii) shall constitute an investment company security, or (iii) shall be held by such Grantor in a Securities Account.


 


(c)           Subject to the terms and conditions of the Credit Agreement, including Sections 7.3 and 7.5 thereof, such Grantor shall not vote to enable or take any other action to: (i) amend or terminate, or waive compliance with any of the terms of, any such Pledged Collateral Agreement, certificate or articles of incorporation, bylaws or other organizational documents in any way that materially and adversely affects the validity, perfection or priority of the Administrative Agent’s security interest therein.


 


SECTION 6.    REMEDIAL PROVISIONS


 


Each Grantor covenants and agrees with the Administrative Agent and the other Secured Parties that, from and after the date of this Agreement until the Discharge of Obligations:


 


6.1           Certain Matters Relating to Receivables.


 


(a)           The Administrative Agent hereby authorizes each Grantor to collect such Grantor’s Receivables, and the Administrative Agent may curtail or terminate said authority at any time after the occurrence and during the continuance of an Event of Default.  If required by the Administrative Agent at any time after the occurrence and during the continuance of an Event of Default, any payments of Receivables, when collected by any Grantor, (i) shall be forthwith (and, in any event, within two (2) Business Days) deposited by such Grantor in the exact form received, duly indorsed by such Grantor to the Administrative Agent if required, in a Collateral Account over which the Administrative Agent has control, subject to withdrawal by the Administrative Agent for the account of the Secured Parties only as provided in Section 6.5, and (ii) until so turned over, shall be held by such Grantor in trust for the Administrative Agent and the other Secured Parties, segregated from other funds of such Grantor.  After the occurrence and during the continuance of an Event of Default, each such deposit of Proceeds of Receivables shall be accompanied by a report identifying in reasonable detail the nature and source of the payments included in the deposit.


 


(b)           At the Administrative Agent’s request, after the occurrence of an Event of Default, each Grantor shall deliver to the Administrative Agent all original and other documents evidencing, and relating to, the agreements and transactions which gave rise to the Receivables, including, without limitation, all original orders, invoices and shipping receipts.


 










  





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6.2           Communications with Obligors; Grantors Remain Liable.


 


(a)           The Administrative Agent in its own name or in the name of others may at any time after the occurrence and during the continuance of an Event of Default communicate with obligors under the Receivables to verify with them to the Administrative Agent’s satisfaction the existence, amount and terms of any Receivables.


 


(b)           Upon the request of the Administrative Agent, at any time after the occurrence and during the continuance of an Event of Default, each Grantor shall notify obligors on the Receivables that the Receivables have been assigned to the Administrative Agent for the ratable benefit of the Secured Parties and that payments in respect thereof shall be made directly to the Administrative Agent.


 


(c)           Anything herein to the contrary notwithstanding, each Grantor shall remain liable under each of the Receivables to observe and perform all the conditions and obligations to be observed and performed by it thereunder, all in accordance with the terms of any agreement giving rise thereto.  Neither the Administrative Agent nor any other Secured Party shall have any obligation or liability under any Receivable (or any agreement giving rise thereto) by reason of or arising out of this Agreement or the receipt by the Administrative Agent or any Lender of any payment relating thereto, nor shall the Administrative Agent nor any other Secured Party be obligated in any manner to perform any of the obligations of any Grantor under or pursuant to any Receivable (or any agreement giving rise thereto), to make any payment, to make any inquiry as to the nature or the sufficiency of any payment received by it or as to the sufficiency of any performance by any party thereunder, to present or file any claim, to take any action to enforce any performance or to collect the payment of any amounts which may have been assigned to it or to which it may be entitled at any time or times.


 


6.3           Investment Property.


 


(a)           Unless an Event of Default shall have occurred and be continuing and the Administrative Agent shall have given written notice to the relevant Grantor of the Administrative Agent’s intent to exercise its corresponding rights pursuant to Section 6.3(b), each Grantor shall be permitted to receive all cash dividends paid in respect of the Pledged Collateral and all payments made in respect of the Pledged Notes to the extent not prohibited by the Credit Agreement, and to exercise all voting and corporate or other organizational rights with respect to the Investment Property of such Grantor; provided, however, that no vote shall be cast or corporate or other organizational right exercised or other action taken which, in the Administrative Agent’s reasonable discretion, would materially impair the Collateral or which would be inconsistent with or result in any violation of any provision of the Credit Agreement, this Agreement or any other Loan Document.


 


(b)           If an Event of Default shall occur and be continuing and the Administrative Agent shall give notice of its intent to exercise such rights to the relevant Grantor or Grantors, (i) the Administrative Agent shall have the right (A) to receive any and all cash dividends, payments or other Proceeds paid in respect of the Investment Property (including the Pledged Collateral) of any or all of the Grantors and make application thereof to the Secured Obligations in the order set forth in Section 6.5, and (B) to exchange uncertificated Pledged Collateral for certificated Pledged Collateral and to exchange certificated Pledged Collateral for certificates of larger or smaller denominations, for any purpose consistent with this Agreement (in each case to the extent such exchanges are permitted under the applicable Pledged Collateral Agreements or otherwise agreed upon by the Issuer of such Pledged Collateral), and (ii) any and all of such Investment Property shall be registered in the name of the Administrative Agent or its nominee, and the Administrative Agent or its nominee may thereafter exercise (x) all voting, corporate and other rights pertaining to such Investment Property at any meeting of shareholders of the relevant Issuer or Issuers or otherwise and (y) any and all rights of conversion, exchange and subscription and any other rights, privileges or options pertaining to such Investment


 










  





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Property as if it were the absolute owner thereof (including, without limitation, the right to exchange at its discretion any and all of any such Investment Property upon the merger, consolidation, reorganization, recapitalization or other fundamental change in the corporate or other organizational structure of any Issuer, or upon the exercise by any Grantor or the Administrative Agent of any right, privilege or option pertaining to such Investment Property, and in connection therewith, the right to deposit and deliver any and all of such Investment Property with any committee, depositary, transfer agent, registrar or other designated agency upon such terms and conditions as the Administrative Agent may determine), all without liability except to account for property actually received by it, but the Administrative Agent shall have no duty to any Grantor to exercise any such right, privilege or option and shall not be responsible for any failure to do so or delay in so doing.


 


(c)           Each Grantor hereby authorizes and instructs each Issuer of any Pledged Collateral or Pledged Notes pledged by such Grantor hereunder to (i) comply with any instruction received by it from the Administrative Agent in writing that (x) states that an Event of Default has occurred and is continuing and (y) is otherwise in accordance with the terms of this Agreement, without any other or further instructions from such Grantor, and each Grantor agrees that each Issuer shall be fully protected in so complying, and (ii) unless otherwise expressly permitted hereby, pay any dividends or other payments with respect to the Pledged Collateral or, as applicable, the Pledged Notes directly to the Administrative Agent.


 


(d)           If an Event of Default shall have occurred and be continuing, the Administrative Agent shall have the right to apply the balance from any Deposit Account or instruct the bank at which any Deposit Account is maintained to pay the balance of any Deposit Account to or for the benefit of the Administrative Agent.


 


6.4           Proceeds to be Turned Over To Administrative Agent.  In addition to the rights of the Administrative Agent and the other Secured Parties specified in Section 6.1 with respect to payments of Receivables, if an Event of Default shall occur and be continuing, all Proceeds received by any Grantor consisting of cash, checks, Cash Equivalents and other near-cash items shall be held by such Grantor in trust for the Administrative Agent and the other Secured Parties, segregated from other funds of such Grantor, and shall, forthwith upon receipt by such Grantor, be turned over to the Administrative Agent in the exact form received by such Grantor (duly indorsed by such Grantor to the Administrative Agent, if required).  All Proceeds received by the Administrative Agent hereunder shall be held by the Administrative Agent in a Collateral Account over which it maintains control, within the meaning of the UCC.  All Proceeds while held by the Administrative Agent in a Collateral Account (or by such Grantor in trust for the Administrative Agent and the other Secured Parties) shall continue to be held as collateral security for all the Secured Obligations and shall not constitute payment thereof until applied as provided in Section 6.5.


 


6.5           Application of Proceeds.  If an Event of Default shall have occurred and be continuing, at any time at the Administrative Agent’s election, the Administrative Agent may apply all or any part of Proceeds constituting Collateral, whether or not held in any Collateral Account, in payment of the Secured Obligations in accordance with Section 8.3 of the Credit Agreement.


 


6.6           Code and Other Remedies.  If an Event of Default shall occur and be continuing, the Administrative Agent, on behalf of the Secured Parties, may exercise, in addition to all other rights and remedies granted to them in this Agreement and in any other instrument or agreement securing, evidencing or relating to the Secured Obligations, all rights and remedies of a secured party under the UCC or any other applicable law.  Without limiting the generality of the foregoing, the Administrative Agent, without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law) to or upon any Grantor or any other Person (all and each of which demands, defenses, advertisements and notices are hereby waived), may in such circumstances


 










  





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forthwith collect, receive, appropriate and realize upon the Collateral, or any part thereof, and/or may forthwith sell, lease, assign, give option or options to purchase, or otherwise dispose of and deliver the Collateral or any part thereof (or contract to do any of the foregoing), in one or more parcels at public or private sale or sales, at any exchange, broker’s board or office of the Administrative Agent or any other Secured Party or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit risk.  The Administrative Agent or any other Secured Party shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption in any Grantor, which right or equity is hereby waived and released.  Each Grantor further agrees, at the Administrative Agent’s request, to assemble the Collateral and make it available to the Administrative Agent at places which the Administrative Agent shall reasonably select, whether at such Grantor’s premises or elsewhere.  The Administrative Agent shall apply the net proceeds of any action taken by it pursuant to this Section 6.6, in accordance with the provisions of Section 6.5, only after deducting all reasonable costs and expenses of every kind incurred in connection therewith or incidental to the care or safekeeping of any of the Collateral or in any way relating to the Collateral or the rights of the Administrative Agent and the other Secured Parties hereunder, including, without limitation, reasonable attorneys’ fees and disbursements, to the payment in whole or in part of the Secured Obligations, in such order as is contemplated by Section 8.3 of the Credit Agreement, and only after such application and after the payment by the Administrative Agent of any other amount required by any provision of law, including Section 9-615(a)(3) of the UCC, but only to the extent of the surplus, if any, owing to any Grantor.  To the extent permitted by applicable law, each Grantor waives all claims, damages and demands it may acquire against the Administrative Agent or any other Secured Party arising out of the exercise by any of them of any rights hereunder, except to the extent caused by the gross negligence or willful misconduct of the Administrative Agent or such Secured Party or their respective agents.  If any notice of a proposed sale or other disposition of Collateral shall be required by law, such notice shall be deemed reasonable and proper if given at least ten (10) days before such sale or other disposition.


 


6.7           Registration Rights.


 


(a)           If the Administrative Agent shall determine to exercise its right to sell any or all of the Pledged Stock pursuant to Section 6.6, and if in the opinion of the Administrative Agent it is necessary or advisable to have the Pledged Stock, or that portion thereof to be sold, registered under the provisions of the Securities Act, the relevant Grantor will cause the Issuer thereof to (i) execute and deliver, and cause the directors and officers of such Issuer to execute and deliver, all such instruments and documents, and do or cause to be done all such other acts as may be, in the opinion of the Administrative Agent, necessary or advisable to register the Pledged Stock, or that portion thereof to be sold, under the provisions of the Securities Act, (ii) use its best efforts to cause the registration statement relating thereto to become effective and to remain effective for a period of one year from the date of the first public offering of the Pledged Stock, or that portion thereof to be sold, and (iii) make all amendments thereto and/or to the related prospectus which, in the opinion of the Administrative Agent, are necessary or advisable, all in conformity with the requirements of the Securities Act and the rules and regulations of the Securities and Exchange Commission applicable thereto.  Each Grantor agrees to cause such Issuer to comply with the provisions of the securities or “Blue Sky” laws of any and all jurisdictions which the Administrative Agent shall designate and to make available to its security holders, as soon as practicable, an earnings statement (which need not be audited) which will satisfy the provisions of Section 11(a) of the Securities Act.


 


(b)           Each Grantor recognizes that the Administrative Agent may be unable to effect a public sale of any or all the Pledged Stock, by reason of certain prohibitions contained in the Securities Act and applicable state securities laws or otherwise, and may be compelled to resort to one or more


 










  





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private sales thereof to a restricted group of purchasers which will be obliged to agree, among other things, to acquire such securities for their own account for investment and not with a view to the distribution or resale thereof.  Each Grantor acknowledges and agrees that any such private sale may result in prices and other terms less favorable than if such sale were a public sale and, notwithstanding such circumstances, agrees that any such private sale shall be deemed to have been made in a commercially reasonable manner.  Subject to its compliance with state securities laws applicable to private sales. the Administrative Agent shall be under no obligation to delay a sale of any of the Pledged Stock for the period of time necessary to permit the Issuer thereof to register such securities for public sale under the Securities Act, or under applicable state securities laws, even if such Issuer would agree to do so.


 


(c)           Each Grantor agrees to use commercially reasonable efforts to do or cause to be done all such other acts as may be necessary to make such sale or sales of all or any portion of the Pledged Stock pursuant to this Section 6.7 valid and binding and in compliance with any applicable Requirement of Law.  Each Grantor further agrees that a breach of any of the covenants contained in this Section 6.7 will cause irreparable injury to the Administrative Agent and the other Secured Parties, that the Administrative Agent and the other Secured Parties have no adequate remedy at law in respect of such breach and, as a consequence, that each and every covenant contained in this Section 6.7 shall be specifically enforceable against such Grantor, and such Grantor hereby waives and agrees not to assert any defenses against an action for specific performance of such covenants except for a defense that no Event of Default has occurred under the Credit Agreement.


 


6.8           Intellectual Property License.  Solely for the purpose of enabling the Administrative Agent to exercise rights and remedies under this Section 6 and at such time as the Administrative Agent shall be lawfully entitled to exercise such rights and remedies, each Grantor hereby grants to the Administrative Agent, for the benefit of the Secured Parties, an irrevocable, non-exclusive, worldwide license (exercisable without payment of royalty or other compensation to such Grantor), subject, in the case of Trademarks, to sufficient rights to quality control and inspection in favor of such Grantor to avoid the risk of invalidation of said Trademarks, to use, operate under, license, or sublicense any Intellectual Property now owned or here­after acquired by the Grantors.


 


6.9           Deficiency.  Each Grantor shall remain liable for any deficiency if the proceeds of any sale or other disposition of the Collateral are insufficient to pay its Secured Obligations and the fees and disbursements of any attorneys employed by the Administrative Agent or any other Secured Party to collect such deficiency.


 


SECTION 7.    THE ADMINISTRATIVE AGENT


 


Each Grantor covenants and agrees with the Administrative Agent and the other Secured Parties that:


 


7.1           Administrative Agent’s Appointment as Attorney-in-Fact, etc.


 


(a)           Each Grantor hereby irrevocably constitutes and appoints the Administrative Agent and any officer or agent thereof, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of such Grantor and in the name of such Grantor or in its own name, for the purpose of carrying out the terms of this Agreement, to take any and all appropriate action and to execute any and all documents and instruments which may be necessary or desirable to accomplish the purposes of this Agreement, and, without limiting the generality of the foregoing, each Grantor hereby gives the Administrative Agent the power and right, on behalf of such Grantor, without notice to or assent by such Grantor, to do any or all of the following:


 










  





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(i)           in the name of such Grantor or its own name, or otherwise, take possession of and indorse and collect any checks, drafts, notes, acceptances or other instruments for the payment of moneys due under any Receivable or with respect to any other Collateral and file any claim or take any other action or proceeding in any court of law or equity or otherwise deemed appropriate by the Administrative Agent for the purpose of collecting any and all such moneys due under any Receivable or with respect to any other Collateral whenever payable;


 


(ii)           in the case of any Intellectual Property, execute and deliver, and have recorded, any and all agreements, instruments, documents and papers as the Administrative Agent may request to evidence the Administrative Agent’s and the other Secured Parties’ security interest in such Intellectual Property and the goodwill and general intangibles of such Grantor relating thereto or represented thereby;


 


(iii)           pay or discharge taxes and Liens levied or placed on or threatened against the Collateral, effect any repairs or any insurance called for by the terms of this Agreement and pay all or any part of the premiums therefor and the costs thereof;


 


(iv)           execute, in connection with any sale provided for in Section 6.6 or 6.7, any endorsements, assignments or other instruments of conveyance or transfer with respect to the Collateral; and


 


(v)           (A) direct any party liable for any payment under any of the Collateral to make payment of any and all moneys due or to become due thereunder directly to the Administrative Agent or as the Administrative Agent shall direct; (B) ask or demand for, collect, and receive payment of and receipt for, any and all moneys, claims and other amounts due or to become due at any time in respect of or arising out of any Collateral; (C) sign and indorse any invoices, freight or express bills, bills of lading, storage or warehouse receipts, drafts against debtors, assignments, verifications, notices and other documents in connection with any of the Collateral; (D) commence and prosecute any suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect the Collateral or any portion thereof and to enforce any other right in respect of any Collateral; (E) defend any suit, action or proceeding brought against such Grantor with respect to any Collateral; (F) settle, compromise or adjust any such suit, action or proceeding and, in connection therewith, give such discharges or releases as the Administrative Agent may deem appropriate; (G) assign any Copyright, Patent or Trademark (along with the goodwill of the business to which any such Copyright, Patent or Trademark pertains), throughout the world for such term or terms, on such conditions, and in such manner, as the Administrative Agent shall in its sole discretion determine; and (H) generally, sell, transfer, pledge and make any agreement with respect to or otherwise deal with any of the Collateral as fully and completely as though the Administrative Agent were the absolute owner thereof for all purposes, and do, at the Administrative Agent’s option and such Grantor’s expense, at any time, or from time to time, all acts and things which the Administrative Agent deems necessary to protect, preserve or realize upon the Collateral and the Administrative Agent’s and the other Secured Parties’ security interests therein and to effect the intent of this Agreement, all as fully and effectively as such Grantor might do.


 


Anything in this Section 7.1(a) to the contrary notwithstanding, the Administrative Agent agrees that it will not exercise any rights under the power of attorney provided for in this Section 7.1(a) unless an Event of Default shall have occurred and be continuing.


 


(b)           If any Grantor fails to perform or comply with any of its agreements contained herein, the Administrative Agent, at its option, but without any obligation so to do, may perform or comply, or otherwise cause performance or compliance, with such agreement.


 










  





25











  













(c)           The expenses of the Administrative Agent incurred in connection with actions undertaken as provided in this Section 7.1, together with interest thereon at a rate per annum equal to the highest rate per annum at which interest would then be payable on any category of past due ABR Loans under the Credit Agreement, from the date of payment by the Administrative Agent to the date reimbursed by the relevant Grantor, shall be payable by such Grantor to the Administrative Agent on demand.


 


(d)           Each Grantor hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue hereof.  All powers, authorizations and agencies contained in this Agreement are coupled with an interest and are irrevocable until this Agreement is terminated and the security interests created hereby are released.


 


7.2           Duty of Administrative Agent.  The Administrative Agent’s sole duty with respect to the custody, safekeeping and physical preservation of the Collateral in its possession, under Section 9-207 of the UCC or otherwise, shall be to deal with it in the same manner as the Administrative Agent deals with similar property for its own account.  Neither the Administrative Agent, any other Secured Party nor any of their respective officers, directors, employees or agents shall be liable for failure to demand, collect or realize upon any of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of any Grantor or any other Person or to take any other action whatsoever with regard to the Collateral or any part thereof.  The powers conferred on the Administrative Agent and the other Secured Parties hereunder are solely to protect the Administrative Agent’s and the other Secured Parties’ interests in the Collateral and shall not impose any duty upon the Administrative Agent or any other Secured Party to exercise any such powers.  The Administrative Agent and the other Secured Parties shall be accountable only for amounts that they actually receive as a result of the exercise of such powers, and neither they nor any of their officers, directors, employees or agents shall be responsible to any Grantor for any act or failure to act hereunder, except for their own gross negligence or willful misconduct.


 


7.3           Authority of Administrative Agent.  Each Grantor acknowledges that the rights and responsibilities of the Administrative Agent under this Agreement with respect to any action taken by the Administrative Agent or the exercise or non-exercise by the Administrative Agent of any option, voting right, request, judgment or other right or remedy provided for herein or resulting or arising out of this Agreement shall, as between the Administrative Agent and the other Secured Parties, be governed by the Credit Agreement and by such other agreements with respect thereto as may exist from time to time among them, but, as between the Administrative Agent and the Grantors, the Administrative Agent shall be conclusively presumed to be acting as agent for the Secured Parties with full and valid authority so to act or refrain from acting, and no Grantor shall be under any obligation, or entitlement, to make any inquiry respecting such authority.


 


SECTION 8.    MISCELLANEOUS


 


8.1           Amendments in Writing.  None of the terms or provisions of this Agreement may be waived, amended, supplemented or otherwise modified except in accordance with Section 10.1 of the Credit Agreement.


 


8.2           Notices.  All notices, requests and demands to or upon the Administrative Agent or any Grantor hereunder shall be effected in the manner provided for in Section 10.2 of the Credit Agreement; provided that any such notice, request or demand to or upon any Guarantor shall be addressed to such Guarantor at its notice address set forth on Schedule 1.


 


8.3           No Waiver by Course of Conduct; Cumulative Remedies.  Neither the Administrative Agent nor any other Secured Party shall by any act (except by a written instrument pursuant to


 










  





26











  













Section 8.1), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default, as applicable.  No failure to exercise, nor any delay in exercising, on the part of the Administrative Agent or any other Secured Party, any right, power or privilege hereunder shall operate as a waiver thereof.  No single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege.  A waiver by the Administrative Agent or any other Secured Party of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which the Administrative Agent or such other Secured Party would otherwise have on any future occasion.  The rights and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any other rights or remedies provided by law.


 


8.4           Enforcement Expenses; Indemnification.


 


(a)           Each Guarantor agrees to pay or reimburse the Administrative Agent and each other Secured Party for all its costs and expenses incurred in collecting against such Guarantor under the guaranty contained in Section 2 of this Agreement or otherwise enforcing or preserving any rights under this Agreement and the other Loan Documents to which such Guarantor is a party, including the fees and disbursements of counsel (including the allocated fees and expenses of in-house counsel) to the Administrative Agent and of counsel to each other Secured Party.


 


(b)           Each Guarantor agrees to pay, and to save the Administrative Agent and each other Secured Party harmless from, any and all liabilities with respect to, or resulting from any delay in paying, any and all stamp, excise, sales or other taxes which may be payable or determined to be payable with respect to any of the Collateral or in connection with any of the transactions contemplated by this Agreement.


 


(c)           Each Guarantor agrees to pay, and to save the Administrative Agent and each other Secured Party harmless from, any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to the execution, delivery, enforcement, performance and administration of this Agreement to the extent the Borrowers would be required to do so pursuant to the Credit Agreement.


 


(d)           The agreements in this Section 8.4 shall survive repayment of the Secured Obligations and any other amounts payable under the Credit Agreement and the other Loan Documents.


 


8.5           Successors and Assigns.  This Agreement shall be binding upon the successors and assigns of each Grantor and shall inure to the benefit of the Administrative Agent and each other Secured Party and their respective successors and assigns; provided that no Grantor may assign, transfer or delegate any of its rights or obligations under this Agreement without the prior written consent of the Administrative Agent.


 


8.6           Set Off.  Each Grantor hereby irrevocably authorizes the Administrative Agent and each other Secured Party and any Affiliate thereof at any time and from time to time after the occurrence and during the continuance of an Event of Default, without notice to such Grantor or any other Grantor, any such notice being expressly waived by each Grantor, to setoff and appropriate and apply any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by the Administrative Agent or such Secured Party or such Affiliate to or for the credit or the account of such Grantor, or any part thereof in such amounts as the Administrative Agent or such Secured Party may elect, against and on account of the Secured Obligations and liabilities of such Grantor to the Administrative Agent or such Secured Party hereunder and under the other Loan Documents and claims of every nature and description of the Administrative


 










  





27











  













Agent or such Secured Party against such Grantor, in any currency, whether arising hereunder, under the Credit Agreement, any other Loan Document or otherwise, as the Administrative Agent or such Secured Party may elect, whether or not the Administrative Agent or any other Secured Party has made any demand for payment and although such obligations, liabilities and claims may be contingent or unmatured.  The rights of the Administrative Agent and each other Secured Party under this Section 8.6 are in addition to other rights and remedies (including, without limitation, other rights of setoff) which the Administrative Agent or such other Secured Party may have.


 


8.7           Counterparts.  This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts (including by facsimile and/or electronic mail), and all of said counterparts taken together shall be deemed to constitute one and the same instrument.


 


8.8           Severability.  Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.


 


8.9           Section Headings.  The Section headings used in this Agreement are for convenience of reference only and are not to affect the construction hereof or be taken into consideration in the interpretation hereof.


 


8.10           Integration.  This Agreement and the other Loan Documents represent the agreement of the Grantors, the Administrative Agent and the other Secured Parties with respect to the subject matter hereof and thereof, and there are no promises, undertakings, representations or warranties by the Administrative Agent or any other Secured Party relative to subject matter hereof and thereof not expressly set forth or referred to herein or in the other Loan Documents.


 


8.11           GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.


 


8.12           Submission to Jurisdiction; Waivers.  Each Grantor hereby irrevocably and unconditionally:


 


(a)           submits for itself and its property in any legal action or proceeding relating to this Agreement and the other Loan Documents to which it is a party, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the State and Federal courts of the District of New York;


 


(b)           consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;


 


(c)           agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to such Grantor at its address referred to in Section 8.2 or at such other address of which the Administrative Agent shall have been notified pursuant thereto;


 


(d)           agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction; and


 










  





28











  













(e)           waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in this Section 8.12 any special, exemplary, punitive or consequential damages.


 


8.13           Acknowledgements.  Each Grantor hereby acknowledges that:


 


(a)           it has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Loan Documents to which it is a party;


 


(b)           neither the Administrative Agent nor any other Secured Party has any fiduciary relationship with or duty to any Grantor arising out of or in connection with this Agreement or any of the other Loan Documents, and the relationship between the Grantors, on the one hand, and the Administrative Agent and the other Secured Parties, on the other hand, in connection herewith or therewith is solely that of debtor and creditor; and


 


(c)           no joint venture is created hereby or by the other Loan Documents or otherwise exists by virtue of the transactions contemplated hereby among any of the Secured Parties or among the Grantors and any of the Secured Parties.


 


8.14           Additional Grantors.  Each Domestic Subsidiary of a Grantor that is required to become a party to this Agreement pursuant to Section 6.12 of the Credit Agreement shall become a Grantor for all purposes of this Agreement upon execution and delivery by such Subsidiary of an Assumption Agreement in the form of Annex 1 hereto.


 


8.15           Releases.


 


(a)           Upon the Discharge of Obligations (including, without limitation, the European Guaranty Obligations), the Collateral shall be released from the Liens in favor of the Administrative Agent and the other Secured Parties created hereby, this Agreement shall terminate with respect to the Administrative Agent and the other Secured Parties, and all obligations (other than those expressly stated to survive such termination) of each Grantor to the Administrative Agent or any other Secured Party hereunder shall terminate, all without delivery of any instrument or performance of any act by any party.  At the sole expense of any Grantor following any such termination, the Administrative Agent shall deliver such documents as such Grantor shall reasonably request to evidence such termination.


 


(b)           If any of the Collateral shall be sold, transferred or otherwise disposed of by any Grantor in a transaction permitted by Section 7.5 of the Credit Agreement, then the Administrative Agent, at the request and sole expense of such Grantor, shall promptly execute and deliver to such Grantor all releases or other documents reasonably necessary or desirable for the release of the Liens created hereby on such Collateral, as applicable.  At the request and sole expense of the Borrowers, a Guarantor shall be released from its obligations hereunder in the event that all the Capital Stock of such Guarantor shall be sold, transferred or otherwise disposed of to a Person other than a Grantor in a transaction permitted by Section 7.5 of the Credit Agreement; provided that the Borrowers shall have delivered to the Administrative Agent, at least ten (10) days, or such shorter period as the Administrative Agent may agree, prior to the date of the proposed release, a written request for release identifying the relevant Guarantor and the terms of the sale or other disposition in reasonable detail, including the price thereof and any expenses in connection therewith, together with a certification by the Borrowers stating that such transaction is in compliance with terms and provisions of the Credit Agreement and the other Loan Documents.


 


8.16           WAIVER OF JURY TRIAL.  EACH GRANTOR AND THE ADMINISTRATIVE AGENT EACH HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY 


 


[remainder of page intentionally left blank]


 










  





29











  








 


 



JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND FOR ANY COUNTERCLAIM THEREIN. WITHOUT INTENDING IN ANY WAY TO LIMIT ANY GRANTOR’S AGREEMENT TO WAIVE THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY.




 



[remainder of page intentionally left blank]




 




 





  





30











  










 


IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee and Collateral Agreement to be duly executed and delivered as of the date first above written.


 


GRANTORS:


 



	
GLOBAL TELECOM & TECHNOLOGY, INC.


 


By   /s/ Michael R. Bauer                                                                


Name:  Michael R. Bauer


Title:    VP and Controller


 

	
GLOBAL TELECOM & TECHNOLOGY AMERICAS, INC.


 


By   /s/ Michael R. Bauer                                                             


Name:  Michael R. Bauer


Title:    VP and Controller


	
PACKETEXCHANGE, INC.


 


By   /s/ Michael R. Bauer                                                                


Name:  Michael R. Bauer


Title:    VP and Controller


 

	
WBS CONNECT, LLC


 


By   /s/ Michael R. Bauer                                                             


Name:  Michael R. Bauer


Title:    VP and Controller


	
PACKETEXCHANGE (USA), INC.


 


By   /s/ Michael R. Bauer                                                                


Name:  Michael R. Bauer


Title:    VP and Controller

	
nLAYER COMMUNICATIONS, INC.


 


By   /s/ Michael R. Bauer                                                           


Name:  Michael R. Bauer


Title:    VP and Controller


	
 


 

	  
	
GTT GLOBAL TELECOM GOVERNMENT SERVICES, LLC, a


Virginia limited liability company


 


By   /s/ Michael R. Bauer                                                                


Name:  Michael R. Bauer


Title:    VP and Controller


 

	
TEK CHANNEL CONSULTING, LLC, a


Colorado limited liability company


 


By   /s/ Michael R. Bauer                                                             


Name:  Michael R. Bauer


Title:    VP and Controller















  





Signature Page 1 to Guarantee and Collateral Agreement











  















	 	
ADMINISTRATIVE AGENT:


 


SILICON VALLEY BANK


  


 


By /s/ Christopher Leary           


Name: Christopher Leary


Title: Vice President


	 	 
	 	 
	
  


  

	 
	 	 







 









 










  





  Signature Page 2 to Guarantee and Collateral Agreement











  









 


SCHEDULE 1


  


NOTICE ADDRESSES OF GUARANTORS


  







  



	
Guarantor

	
Notice Address


	
For each of:


 


Global Telecom & Technology, Inc.


Global Telecom & Technology Americas


WBS Connect, LLC


PacketExchange, Inc.


PacketExchange (USA), Inc.


nLayer Communications, Inc.


TEK Channel Consulting, LLC


GTT Global Telecom Government Services, LLC

	
 


 


c/o Global Telecom and Technology, Inc.


8484 West Park Drive, Suite 720


McLean, VA 22102


Att: Richard D. Calder, Jr.


Fax (703) 442-5595















 





Schedule 1 











 















SCHEDULE 2


  


DESCRIPTION OF INVESTMENT PROPERTY


  







  


Pledged Stock:


  



	
Grantor

	
Issuer

	
Class of Capital

Stock

	
Certificate

No.

	
No. of Shares / 

Units


	
Global Telecom &

Technology, Inc.

	
Global Telecom &

Technology

Americas, Inc.

(“GTTA”)

	 	 	
100% of shares in

GTTA


	
GTTA

	
WBS Connect, LLC

(“WBS”)

	 	 	
100% of the equity

interest in WBS


	
GTTA

	
TEK Channel

Consulting, LLC

(“TEK”)

	 	 	
100% equity

interests in TEK


	
GTTA

	
GTT Global

Telecom

Government

Services, LLC

(“GTTGS”)

	 	 	
100% equity

interests in

GTTGS


	
GTTA

	
PacketExchange

(USA), Inc

(“PUSA”)

	 	 	
100% equity

interests in PUSA


	
GTTA

	
PacketExchange, Inc

(“PINC”)

	 	 	
100% equity

interests in PINC


	
GTTA

	
nLayer

Communications,

Inc (“NLAYER”)

	 	 	
100% equity

interests in

NLAYER







  


Pledged Notes:


  



	
Grantor

	
Issuer

	
Date of Issuance

	
Payee

	
Principal Amount


	 	 	 	 	 





  







  


  


Securities Accounts:


  



	
Grantor

	
Securities Intermediary

	
Address

	
Account Number(s)


	 	 	 	 





  







  


  




 





Schedule 2











 











  


  


  


Commodity Accounts:


  



	
Grantor

	
Commodities

Intermediary

	
Address

	
Account Number(s)


	 	 	 	 





  


Deposit Accounts:


  



	
Grantor

	
Depositary Bank

	
Address

	
Account Number(s)


	
Global Telecom

& Technology

Americas, Inc.

	
Silicon Valley Bank


  

	
3003 Tasman Dr.


P.O. Box 276


Santa Clara, CA 95054

	
3300601931


3300601387


3300864681


3300603961


3300601372


	
Global Telecom

& Technology,

Inc.

	
Silicon Valley Bank


  

	
3003 Tasman Dr.


P.O. Box 276


Santa Clara, CA 95054

	
3300601372


3300601391


3300861387


3300603976


	
WBS Connect

LLC

	
Silicon Valley Bank

	
Same as above

	
3300603976


3300603961


	
nLayer

Communications,

Inc.

	
Chase Bank

	
10 South Dearborn,

Chicago IL

	
761214576


761214592


2912966716















 





Schedule 2











 













SCHEDULE 3


  


FILINGS AND OTHER ACTIONS


REQUIRED TO PERFECT SECURITY INTERESTS


  


  


  


Uniform Commercial Code Filings


  



	
1.   UCC Financing Statement naming Global Telecom & Technology, Inc. as “debtor” and the Administrative Agent as “secured party” to be filed with the Secretary of State of the State of Delaware.


 


	
2.   UCC Financing Statement naming Global Telecom & Technology Americas, Inc. as “debtor” and the Administrative Agent as “secured party” to be filed with the State Corporation Commission of the Commonwealth of Virginia.


 


	
3.   UCC Financing Statement naming GTT Global Telecom Government Services, LLC as “debtor” and the Administrative Agent as “secured party” to be filed with the State Corporation Commission of the Commonwealth of Virginia.


 


	
4.   UCC Financing Statement naming TEK Channel Consulting, LLC as “debtor” and the Administrative Agent as “secured party” to be filed with the Secretary of State of the State of Colorado.


 


	
5.   UCC Financing Statement naming WBS Connect LLC as “debtor” and the Administrative Agent as “secured party” to be filed with the Secretary of State of the State of Colorado.


 


	
6.   UCC Financing Statement naming PacketExchange, Inc. as “debtor” and the Administrative Agent as “secured party” to be filed with the Secretary of State of the State of Delaware.


 


	
7.   UCC Financing Statement naming PacketExchange (USA), Inc. as “debtor” and the Administrative Agent as “secured party” to be filed with the Secretary of State of the State of Delaware.


 


	
8.    UCC Financing Statement naming nLayer Communications, Inc. as “debtor” and the Administrative Agent as “secured party” to be filed with the Secretary of State of the State of Illinois.


 


	
9.    UCC-3 Termination Statement to be filed with the Secretary of State of the State of Delaware for the purpose of amending UCC-1 Financing Statement No. 20112544792 filed by Administrative Agent against Global Telecom & Technology, Inc.


 


	
10.    UCC-3 Termination Statement to be filed with the State Corporate Commission in the Commonwealth of Virginia for the purpose of amending UCC-1 Financing Statement No. 11070140902 filed by Administrative Agent against Global Telecom & Technology Americas, Inc.


 















 





Schedule 3











 



















	
11.    UCC-3 Termination Statement to be filed with the State Corporate Commission in the Commonwealth of Virginia for the purpose of amending UCC-1 Financing Statement No. 11070140914 filed by Administrative Agent against Global Telecom & Technology Americas, Inc.


 


	
12.    UCC-3 Termination Statement to be filed with the Secretary of State of the State of Colorado for the purpose of amending UCC-1 Financing Statement No. 2011F031954 filed by Administrative Agent against TEK Channel Consulting, LLC.


 


	
13.    UCC-3 Termination Statement to be filed with the Secretary of State of the State of Colorado for the purpose of amending UCC-1 Financing Statement No. 2011F031953 filed by Administrative Agent against WBS Connect LLC.


 


	
14.    UCC-3 Termination Statement to be filed with the Secretary of State of the State of Delaware for the purpose of amending UCC-1 Financing Statement No. 20112544743 filed by Administrative Agent against PacketExchange, Inc.


 


	
15.    UCC-3 Termination Statement to be filed with the Secretary of State of the State of Delaware for the purpose of amending UCC-1 Financing Statement No. 20112544776 filed by Administrative Agent against PacketExchange (USA), Inc.


 


	
16.    UCC-3 Termination Statement to be filed with the Secretary of State of the State of Illinois for the purpose of amending UCC-1 Financing Statement No. 17248030 filed by Administrative Agent against nLayer Communications, Inc.


 















 





Schedule 3











 













SCHEDULE 4


  


LOCATION OF JURISDICTION OF ORGANIZATION,


CHIEF EXECUTIVE OFFICE AND LOCATION OF BOOKS


  


  



	

        Grantor       



	

Jurisdiction

of

Organization



	

Organizational

 Identification

       Number      



	

   Location of

Chief Executive

        Office          



	

Location of

     Books    




	
Global Telecom

& Technology

Americas, Inc.

	
Virginia

	
3903078

	
8484 Westpark

Drive, Suite 720


 


McLean, VA

22102

	
8484 Westpark

Drive, Suite 720


  


McLean, VA


22102


	
WBS Connect,

LLC

	
Colorado

	
2051242510

	
8484 Westpark

Drive, Suite 720


 


McLean, VA


22102

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102


	
TEK Channel

Consulting, LLC

	
Colorado

	
20021039642

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102


	
GTT Global

Telecom

Government

Services, LLC

	
Virginia

	
S149761

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102


	
PacketExchange

(USA), Inc.

	
Delaware

	
4767185

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102


 


11a Curtain Road,


London, EC2A


3LT UK


 


St 4737, 707


Wilshire Blvd.


 


Los Angeles, CA


90017





  


  




 





Schedule 4











 






  


	
PacketExchange,

Inc.

	
Delaware

	
4115844

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102


  


11a Curtain Road,

London, EC2A


3LT UK


  


St 4737, 707


Wilshire Blvd.


 


Los Angeles, CA


90017


 


	
nLayer 


Communications,


Inc.

	
Illinois

	
65816016

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102

	
8484 Westpark


Drive, Suite 720


 


McLean, VA


22102















 





Schedule 4











 













SCHEDULE 5


  


LOCATIONS OF EQUIPMENT AND INVENTORY


  



	
Grantor

	
Address Location


	
GTTI

	
8484 Westpark Drive, Suite 720


McLean, VA 22102


 


5th Floor, Morley House,


26 Holborn Viaduct,


London EC1A 2AT,


United Kingdom












  



  


	
Grantor


  

	
Address Location


	
WBS Connect LLC

	
1 Summer St


Boston, MA 02141


 


11 Great Oaks


San Jose , CA 95119


  


111 5th Ave


Suite 1515


New York, NY 10011


  


111 8th Ave


New York, NY 10011


  


120 E Van Burn


Phoenix, AZ 85003


  


1200 W 7th


Los Angeles, CA 90017


  


1270 Avenue of the Americas


New York, NY 10020


  


14 Corriander


London, UK


14 E 38th St.


New York, NY 10016


  


1540 Broadway


24th FL





  


  




 





Schedule 5











 






  


  


	 	
New York, NY 10036


 


165 Halsey St


Newark, NJ 07102


  


1850 Pearl St


Denver, CO 80203


  


2001 W 6th Ave


Seattle , WA 98121


  


2109 S Wadsworth Blvd


Lakewood, CO 80226


  


21711 Filigree Ct


Ashburn, VA 20147


  


223 Store Hill Rd


Old Westbury, NY 11568


  


2323 Bryan St


Dallas, TX, 75201


  


255 Caspian Dr


Sunnyvale, CA, 94089


  


26 W 17th St


New York, NY 10011


  


275 Hartz Way


Seacaucus, NJ 07094


  


30 Irving Place


New York, NY 10003


  


300 Bent St


Cambridge, MA 02141


  


350 E Cermak


Chicago, IL 60616


  


36 Broadway


26th Floor


New York, NY 10006





  


  




 





Schedule 5











 






  


	 	
36 NE Second


Miami, FL 33132


  


391 Inverness Parkway


Englewood, CO 80112


 


401 N. Broad


Philadelphia, PA 19108


 


44470 Chilum Pl


Ashburn, VA 20147


 


44480 Hastings Dr


Ashburn, VA 20147


 


50 NE 9th St


Miami, FL 33132


 


509 Madison Ave


New York, NY 10022


 


529 5th Ave


New York, NY 10017


 


56 Marietta St


Atlanta, GA 30303


 


60 Hudson St


New York, NY 10013


 


600 W 7th Ave


Los Angeles, CA 90017


 


601 W 26th St


New York, NY 10001


 


623 5th Ave


New York, NY 10022


 


624 S Grand Ave


Los Angeles, CA 90017


 


626 Wilshire Blvd





  


  




 





Schedule 5











 






  


  


	 	
Los Angeles, CA 90017


 


777 Central Blvd


Carlstadt, NJ 07072


  


800 S Hope


Los Angeles, CA 90017


  


800 Third Ave


New York, NY 10022


  


83 Gerber Rd


South Windsor, CT 06074


  


882 3rd Ave


Brooklyn, New York NY


  


894 Ross Dr


Sunnyvale, CA 94089


 


910 15 th St


Denver, CO 80202


  


910 Lenex Pointe Dr


Charlotte, NC 28273


  


1275 K Street NW


Washington, DC 20005


  


624 S Grand Ave


Los Angeles, CA 90017


  


140 Pearl St


Buffalo, NY 14202


  


403 Main Street


Buffalo, NY 14203


  


14 E 38th St


New York, NY 10026


  


1150 US Hwy 22 East


Bridgewater, NJ 08807





  


  




 





Schedule 5











 






  


  


	 	
15 Gardner Rd


Fairfiled, NJ 07004


 


105 E 17th St


New York, NY 10003


 


44480 Hastings Dr


Ashburn, VA 20147


 


21711 Filigree Ct


Ashburn, VA 20147


 


350 E Cermak


Chicago, IL 60616


 


1950 Stemmons Frwy


Dallas, TX 75207


 


300 Bent St


Boston, MA 02141


 


120 E Van Buren


Phoenix, AZ 85003


 


818 W 7th St


Los Angeles, CA 90017


 


401 N. Broad


Philadelphia, PA 19108


 


56 Marietta St


Atlanta, GA 30303


 


111 8th Ave


New York, NY 10011


 


56 Marietta St


Atlanta, GA 30303


 


50 NE 9th St


Miami, FL 33132


 


2001 W 6th Ave


Seattle , WA 98121












  




  





Schedule 5











  







	
Grantor

	
Address Location


	
PEINC

	
FIBRENET


111 8TH AVENUE


NEW YORK


 


EQUINIX,


ASHBURN G,


44470 CHILUM PLACE


ASHBURN VA 20147


 


EQUINIX


350 E CERMAK ROAD


CHICAGO IL 60616


 


ONE WILSHIRE


624 S GRAND AVE


 SUITE 1110


LOS ANGELES CA 90017


 


50 NE 8TH STREET


 MIAMI FL 33132


 


EQUNIX


11 GREAT OAKS BLVD


SAN JOSE CA 95119


 


PAIX


529 BRYANT STREET


PALO ALTO CA 94301


 


MARKET POST TOWER


55 SOUTH MARKET STREET


SAN JOSE CA 95113


 


WESTIN BUILDING


2001 SIXTH AVENUE


SUITE 300


SEATTLE WA 98121


 


AT&T


15 ENTERPRISE AVENUE


SECAUCUS NY 07094





  


  




 





Schedule 5











 








  


  



	 	
365 MAIN STREET


SAN FRANCISCO CA 94105


 


Dallas 1950 N. Stemmons Fwy


  


Telx 60 Hudson Street


 


	
Grantor

	
Address Location


	
PEUSA

	
100 William Street


21st Floor


New York NY


 


11 Great Oaks Blvd


San Jose CA


 


111 8th Ave


Ste 1515


New York NY


 


1735 Lundy Ave


San Jose CA


 


1920 Maple


El Segundo CA


 


1950 N Stemmons Fwy


Dallas TX


 


2001 Sixth Ave Suite 910


Seattle WA


 


21715 Filigree Ct


Ashburn, VA


 


275 Hartz Way


Secaucus NJ


 


350 E Cermale


5th Floor


Chicago IL


 


55 S Market Street





  


  




 





Schedule 5











 






  


  



  




	 	
2nd Floor


San Jose CA


  


56 Marietta


Atlanta GA


  


60 Hudson St 9th Floor


New York NY


  


600 W 7th St 6th Floor


Los Angeles CA


  


624 S Grand Ave 11th Floor


Los Angeles CA


  


818 W 7th St 6th Floor


Los Angeles CA


  


120 E. Van Buren Street


Phoenix AZ 85004


  


1100 Walnut Street


Kansas City MO


  


707 Wilshire Blvd., Suite 4737


Los Angeles, CA 90017












  



	
Grantor

	
Address Location


	
GTTA

	
8484 Westpark Drive, Suite 720


McLean, VA 22102







  


  


  










 





Schedule 5











 












SCHEDULE 6


  












RIGHTS OF THE GRANTORS RELATING TO PATENTS












  


N/A  


  


  


  


  







  


RIGHTS OF THE GRANTORS RELATING TO TRADEMARKS


  


  


Registered Trademarks of nLayer Communications, Inc.


  


  



	
Jurisdiction

	
Registration


No.

	
Registration

Date

	
Filing

Date


  

	
Registered Owner

	
Mark


	
USPTO

	
2903299

	
11/16/2004

	 	
nLayer


Communications, Inc.

	
“NLAYER


COMMUNICATIONS”












  


Registered Trademarks of [NAME OF GRANTOR]


  


  



	
Jurisdiction

	
RegistrationNo.

	
Registration

Date

	
Filing Date

	
Registered Owner

	
Mark


	
USPTO

	
2964558

	
07/05/2005

	 	
Global Telecom Technology Americas, Inc.

	
“Global Internetworking”












  


Pending Trademark Applications


  


N/A


  



	
Jurisdiction

	
Application No.

	
Filing Date

	
Applicant

	
Mark


	 	 	 	 	 










  








 





Schedule 6











 










SCHEDULE 7


  


  


LETTER OF CREDIT RIGHTS


  


  


N/A


  








 





Schedule 7











 










SCHEDULE 8


  


  


COMMERCIAL TORT CLAIMS


  


  


N/A


  









Schedule 8




 





 











 













ANNEX 1 TO


 


GUARANTEE AND COLLATERAL AGREEMENT


 


FORM OF


ASSUMPTION AGREEMENT


 


This ASSUMPTION AGREEMENT, dated as of [_______], is executed and delivered by [______________________________] (the “Additional Grantor”), in favor of SILICON VALLEY BANK, as administrative agent (in such capacity, the “Administrative Agent”) for the banks and other financial institutions or entities (the “Lenders”) from time to time parties to that certain Credit Agreement, dated as of May 23, 2012 (as amended, amended and restated, supplemented, restructured or otherwise modified, renewed or replaced from time to time, the “Credit Agreement”), among Global Telecom and Technology, Inc., a Delaware corporation (“GTTI”), Global Telecom & Technology Americas, Inc., a Virginia corporation (“GTTA”), Packetexchange (USA), Inc., a Delaware corporation (“PEUSA”), Packetexchange, Inc., a Delaware corporation (“PEINC”), WBS Connect, LLC,  a Colorado limited liability company (“WBS”), nLayer Communications, Inc., a Delaware corporation (“NLAYER”),  (GTTI, GTTA, PEUSA, PEINC and WBS are hereinafter referred to, individually, as a “Borrower” and collectively, jointly and severally, as the “Borrowers”), the Guarantors party thereto, the Lenders party thereto and the Administrative Agent.  All capitalized terms not defined herein shall have the respective meanings ascribed to such terms in such Credit Agreement.


 


W I T N E S S E T H:


 


WHEREAS, in connection with the Credit Agreement, the Borrowers and certain of their Affiliates (other than the Additional Grantor) have entered into that certain Guarantee and Collateral Agreement, dated as of May 23, 2012, in favor of the Administrative Agent for the benefit of the Secured Parties defined therein (the “Guarantee and Collateral Agreement”);


 


WHEREAS, the Borrowers are required, pursuant to Section 6.12 of the Credit Agreement to cause the Additional Grantor to become a party to the Guarantee and Collateral Agreement in order to grant in favor of the Administrative Agent (for the ratable benefit of the Lenders) the Liens and security interests therein specified and provide its guarantee of the Obligations as therein contemplated; and


 


WHEREAS, the Additional Grantor has agreed to execute and deliver this Assumption Agreement in order to become a party to the Guarantee and Collateral Agreement;


 


NOW, THEREFORE, IT IS AGREED:


 


1.  Guarantee and Collateral Agreement.  By executing and delivering this Assumption Agreement, the Additional Grantor, as provided in Section 8.14 of the Guarantee and Collateral Agreement, (a) hereby becomes a party to the Guarantee and Collateral Agreement as both a “Grantor” and a “Guarantor” thereunder with the same force and effect as if originally named therein as a Grantor and a Guarantor and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and liabilities of a Grantor and a Guarantor thereunder (including, without limitation, Obligations arising under the European Loan Agreement), and (b) hereby grants to the Administrative Agent, for the benefit of the Secured Parties, as security for the Secured Obligations, a security interest in all of the Additional Grantor’s right, title and interest in any and to all Collateral of the Additional Grantor, in each case whether now owned or hereafter acquired or in which the Additional Grantor now has or hereafter acquires an interest and wherever the same may be located, but subject in all respects to the terms, conditions and exclusions set forth in the Guarantee and Collateral Agreement.  The information set forth in Schedule 1 hereto is hereby added to the information set forth in the Schedules to 


 


 



  









 





Annex 1











 






  




the Guarantee and Collateral Agreement.  The Additional Grantor hereby represents and warrants that each of the representations and warranties contained in Section 4 of the Guarantee and Collateral Agreement (x) that is qualified by materiality is true and correct, and (y) that is not qualified by materiality, is true and correct in all material respects, in each case, on and as the date hereof (after giving effect to this Assumption Agreement) as if made on and as of such date (except to the extent any such representation and warranty expressly relates to an earlier date, in which case such representation and warranty was true and correct in all material respects as of such earlier date).




 


2.  Governing Law.  THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.


 


3.  Loan Document.  This Assumption Agreement shall constitute a Loan Document under the Credit Agreement.


 


IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be duly executed and delivered as of the date first above written.


 


 









	  	
[ADDITIONAL GRANTOR]


 


 


By:                                                         


       Name:


       Title:









 


 


 




 






 





Annex 1











 






  











Schedule to


Assumption Agreement


 


 


Supplement to Schedule 1


 


 


 


Supplement to Schedule 2


 


 


 


Supplement to Schedule 3


 


 


 


Supplement to Schedule 4


 


 


 


Supplement to Schedule 5


 


 


 


Supplement to Schedule 6


 


 


 


Supplement to Schedule 7


 


 


 


Supplement to Schedule 8


 


 


 



  






 





Annex 1











 






  













ANNEX 2 TO


 


GUARANTEE AND COLLATERAL AGREEMENT


 


FORM OF


 


PLEDGE SUPPLEMENT


 


 









	
To:

	
Silicon Valley Bank, as Administrative Agent


	  	  
	
Re:

	
               [Borrower]


	  	  
	
Date:

	
           









Ladies and Gentlemen:









This Pledge Supplement (this “Pledge Supplement”) is made and delivered pursuant to Section 3.3(g) of that certain Guarantee and Collateral Agreement, dated as of May 23, 2012 (as amended, modified, renewed or extended from time to time, the “Guarantee and Collateral Agreement”), among each Grantor party thereto (each a “Grantor” and collectively, the “Grantors”), and Silicon Valley Bank (the “Administrative Agent”).  All capitalized terms used in this Pledge Supplement and not otherwise defined herein shall have the meanings assigned to them in either the Guarantee and Collateral Agreement or the Credit Agreement (as defined in the Guarantee and Collateral Agreement), as the context may require.







The undersigned, ___________________________ [insert name of Grantor], a _____________________ [corporation, partnership, limited liability company, etc.], confirms and agrees that all Pledged Collateral of the undersigned, including the property described on the supplemental schedule attached hereto, shall be and become part of the Pledged Collateral and shall secure all Secured Obligations.







Schedule 2 to the Guarantee and Collateral Agreement is hereby amended by adding to such Schedule 2 the information set forth in the supplement attached hereto.







This Pledge Supplement shall constitute a Loan Document under the Credit Agreement.







THIS PLEDGE SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.







IN WITNESS WHEREOF, the undersigned has executed this Pledge Supplement, as of the date first above written.


 


 









	  	
[NAME OF APPLICABLE GRANTOR]


 


	  	
 


By:

	  
	  	
 


Name:

	  
	  	
 


Title:

	  







 






  






 





Annex 2











 






  















SUPPLEMENT TO ANNEX 2


 


TO THE SECURITY AGREEMENT


 



	
Name of Subsidiary

	
Number of Units/Shares Owned

	
Certificate(s) Numbers

	
Date Issued

	
Class or Type of Units or Shares

	
Percentage of Subsidiary’s Total Equity Interests Owned


	  	  	  	  	  	  










 







 







 







 







 


Annex 1