Exhibit 10.2


 


EXECUTION COPY


 




 





GUARANTEE AND COLLATERAL AGREEMENT


 


dated as of


 


November 15, 2007


 


among


 


SYMMETRY HOLDINGS INC.


 


NOVAMERICAN STEEL FINCO INC.


 


NOVAMERICAN STEEL INC.


 


THE OTHER SUBSIDIARIES OF SYMMETRY HOLDINGS
INC.

IDENTIFIED HEREIN


 


and


 


JPMORGAN CHASE BANK, N.A.


as Administrative Agent


 


THIS GUARANTEE AND COLLATERAL AGREEMENT IS SUBJECT TO THE PROVISIONS OF
THE LIEN SUBORDINATION AND INTERCREDITOR AGREEMENT OF EVEN DATE HEREWITH AMONG
SYMMETRY HOLDINGS INC., NOVAMERICAN STEEL FINCO INC., NOVAMERICAN STEEL INC.,
OTHER SUBSIDIARIES OF SYMMETRY HOLDINGS INC. IDENTIFIED THEREIN, JPMORGAN CHASE
BANK, N.A., AS THE ADMINISTRATIVE AGENT, AND THE BANK OF NEW YORK, AS
COLLATERAL AGENT UNDER THE SENIOR NOTES DOCUMENTS, AS MORE FULLY SET FORTH IN SECTION
7.16 HEREOF.




 





[CS&M Ref. No. 6701-732]


 

















 


TABLE OF CONTENTS


 


ARTICLE I


 


Definitions


 


	
  SECTION 1.01.

  	
   

  	
  Credit Agreement

  	
  1

  
	
  SECTION 1.02.

  	
   

  	
  Other Defined Terms

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  
	
   

  
	
  Guarantee

  
	
   

  
	
  SECTION 2.01.

  	
   

  	
  Guarantee

  	
  8

  
	
  SECTION 2.02.

  	
   

  	
  Guarantee of Payment

  	
  8

  
	
  SECTION 2.03.

  	
   

  	
  No Limitations

  	
  8

  
	
  SECTION 2.04.

  	
   

  	
  Reinstatement

  	
  9

  
	
  SECTION 2.05.

  	
   

  	
  Agreement to Pay; Subrogation

  	
  9

  
	
  SECTION 2.06.

  	
   

  	
  Information

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  
	
   

  	
   

  	
   

  	
   

  
	
  Pledge of Securities

  
	
   

  
	
  SECTION 3.01.

  	
   

  	
  Pledge

  	
  10

  
	
  SECTION 3.02.

  	
   

  	
  Delivery of the Pledged
  Collateral

  	
  11

  
	
  SECTION 3.03.

  	
   

  	
  Representations, Warranties and
  Covenants

  	
  12

  
	
  SECTION 3.04.

  	
   

  	
  Certification of Limited
  Liability Company and Limited Partnership Interests

  	
  13

  
	
  SECTION 3.05.

  	
   

  	
  Registration in Nominee Name;
  Denominations

  	
  13

  
	
  SECTION 3.06.

  	
   

  	
  Voting Rights; Dividends and
  Interest

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  
	
   

  	
   

  	
   

  	
   

  
	
  Security Interests in Personal Property

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.01.

  	
   

  	
  Security Interest

  	
  15

  
	
  SECTION 4.02.

  	
   

  	
  Representations and Warranties

  	
  17

  
	
  SECTION 4.03.

  	
   

  	
  Covenants

  	
  17

  
	
  SECTION 4.04.

  	
   

  	
  Other Actions

  	
  20

  
	
  SECTION 4.05.

  	
   

  	
  Covenants Regarding Patent,
  Trademark and Copyright Collateral

  	
  23

  
	
  SECTION 4.06. 

  	
   

  	
  Deposit Accounts; Lockbox
  System; Payment Collection.

  	
  24

  



 


(i)

















 


	
  ARTICLE V

  
	
   

  	
   

  	
   

  	
   

  
	
  Remedies

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.01.

  	
   

  	
  Remedies Upon Default

  	
  26

  
	
  SECTION 5.02.

  	
   

  	
  Application of Proceeds

  	
  28

  
	
  SECTION 5.03.

  	
   

  	
  Grant of License to Use
  Intellectual Property

  	
  29

  
	
  SECTION 5.04.

  	
   

  	
  Securities Act

  	
  29

  
	
  SECTION 5.05.

  	
   

  	
  Registration

  	
  30

  
	
  SECTION 5.06.

  	
   

  	
  Concerning Pledged Securities

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  
	
   

  	
   

  	
   

  	
   

  
	
  Indemnity, Subrogation and Subordination

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.01.

  	
   

  	
  Indemnity and Subrogation

  	
  31

  
	
  SECTION 6.02.

  	
   

  	
  Contribution and Subrogation

  	
  31

  
	
  SECTION 6.03.

  	
   

  	
  Subordination

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  
	
   

  	
   

  	
   

  	
   

  
	
  Miscellaneous

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7.01.

  	
   

  	
  Notices

  	
  32

  
	
  SECTION 7.02.

  	
   

  	
  Waivers; Amendment

  	
  32

  
	
  SECTION 7.03.

  	
   

  	
  Administrative Agent’s Fees and
  Expenses; Indemnification

  	
  33

  
	
  SECTION 7.04.

  	
   

  	
  Successors and Assigns

  	
  33

  
	
  SECTION 7.05.

  	
   

  	
  Survival of Agreement

  	
  33

  
	
  SECTION 7.06.

  	
   

  	
  Counterparts; Effectiveness;
  Several Agreement

  	
  34

  
	
  SECTION 7.07.

  	
   

  	
  Severability

  	
  34

  
	
  SECTION 7.08.

  	
   

  	
  Right of Set-Off

  	
  34

  
	
  SECTION 7.09.

  	
   

  	
  Governing Law; Jurisdiction;
  Consent to Service of Process

  	
  35

  
	
  SECTION 7.10.

  	
   

  	
  WAIVER OF JURY TRIAL

  	
  35

  
	
  SECTION 7.11.

  	
   

  	
  Headings

  	
  36

  
	
  SECTION 7.12.

  	
   

  	
  Security Interest Absolute

  	
  36

  
	
  SECTION 7.13.

  	
   

  	
  Termination or Release

  	
  36

  
	
  SECTION 7.14.

  	
   

  	
  Additional Subsidiaries

  	
  36

  
	
  SECTION 7.15.

  	
   

  	
  Administrative Agent Appointed
  Attorney-in-Fact

  	
  37

  
	
  SECTION 7.16.

  	
   

  	
  Intercreditor Agreement;
  Possession and Control of Non-ABL Collateral

  	
  37

  



 


(ii)

















 


	
  Schedules

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Schedule I

  	
   

  	
  Subsidiary
  Parties

  	
   

  
	
  Schedule II

  	
   

  	
  Pledged
  Equity Interests; Pledged Debt Securities

  	
   

  
	
  Schedule III

  	
   

  	
  Intellectual
  Property

  	
   

  
	
  Schedule IV

  	
   

  	
  Commercial
  Tort Claims

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibits

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit I

  	
   

  	
  Form of
  Supplement

  	
   

  
	
  Exhibit II

  	
   

  	
  Form of
  Patent and Trademark Security Agreement

  	
   

  
	
  Exhibit III

  	
   

  	
  Form of
  Copyright Security Agreement

  	
   

  



 


(iii)

















 


GUARANTEE AND COLLATERAL AGREEMENT dated as
of November 15, 2007, among SYMMETRY HOLDINGS INC., NOVAMERICAN STEEL FINCO
INC., NOVAMERICAN STEEL INC., the other Subsidiaries of SYMMETRY HOLDINGS INC.
identified herein and JPMORGAN CHASE BANK, N.A., as Administrative Agent.


 


Reference is
made to the Credit Agreement dated as of November 15, 2007 (as amended,
supplemented or otherwise modified from time to time, the “Credit Agreement”), among
Symmetry Holdings Inc. (“Symmetry”),
Novamerican Steel Finco Inc. (the “US Borrower”),
Novamerican Steel Inc. (the “Canadian Borrower”
and, together with the US Borrower, the “Borrowers”), the Lenders party thereto and JPMorgan Chase
Bank, N.A., as Administrative Agent. The Lenders have agreed to extend credit
to the Borrowers on the terms and subject to the conditions set forth in the
Credit Agreement. The obligations of the Lenders to extend such credit are
conditioned on, among other things, the execution and delivery of this
Agreement. Symmetry and the Subsidiary Parties are affiliates of the Borrowers,
will derive substantial benefits from the extension of credit to the Borrowers
pursuant to the Credit Agreement and are willing to execute and deliver this
Agreement in order to induce the Lenders to extend such credit. Accordingly,
the parties hereto agree as follows:


 


ARTICLE I


 


Definitions


 


SECTION 1.01. Credit
Agreement.  (a)  Capitalized terms used in this Agreement and
not otherwise defined herein have the meanings specified in the Credit
Agreement.


 


(b)  The rules of construction specified in
Section 1.03 of the Credit Agreement also apply to this Agreement, mutatis
mutandis.


 


SECTION 1.02. Other
Defined Terms. (a) 
All terms defined in the New York UCC (as defined below) and not defined
in this Agreement have the meanings specified therein. The term “instrument”
shall have the meaning specified in Article 9 of the New York UCC.


 


(b)  As used in this Agreement, the following
terms have the meanings specified below:


 


“ABL Collateral” means any and all of
the following:  (a) all Accounts Receivable and related Records,
(b) all Chattel Paper, (c) all Deposit Accounts (other than the Notes
Collateral Account and the Intercompany Note Collateral Account), (d) all
cash, checks and other negotiable instruments, funds and other evidences of
payment (excluding any cash or other assets held in the Notes Collateral
Account or the Intercompany Notes Collateral Account in accordance with the
Indenture, as in effect on the date hereof), (e) all Inventory,
(f) to the extent evidencing, governing, securing or


 

















 


otherwise related
to the items referred to in the preceding clauses (a), (b), (c), (d) and
(e), all Documents, General Intangibles, Instruments, Investment Property and
Letter of Credit Rights, (g) all books and records related to the
foregoing, (h) all collateral security and guarantees given by any Person
with respect to any of the foregoing and (i) all Proceeds, including
insurance Proceeds, of any and all of the foregoing.


 


“Account Debtor” means any Person who is or who
may become obligated to any Grantor under, with respect to or on account of an
Account.


 


“Accounts Receivable” means all Accounts and other
rights to payment, in each case for the sale of Inventory or the performance of
services, existing on the date of this Agreement or hereafter arising, whether or
not earned by performance.


 


“Article 9 Collateral” means any and all of
the following:  (a) all Accounts and
related Records, (b) all Chattel Paper, (c) all Deposit Accounts,
(d) all cash, checks and other negotiable instruments, funds and other evidences
of payment, (e) all Inventory, (f) all Equipment (including all
Fixtures), (f) all Documents, (g) all General Intangibles (including
all Intellectual Property), (h) all Instruments, (i) all Investment
Property, (j) all Letter of Credit Rights, (k) all Commercial Tort
Claims described on Schedule IV, (l) all books and records related to
the foregoing and (m) all Proceeds (including insurance Proceeds) and
products of any and all of the foregoing and all collateral security and
guarantees given by any Person with respect to any of the foregoing. The
Article 9 Collateral includes, but is not limited to, the ABL Collateral.


 


“Borrowers”
has the meaning assigned thereto in the preliminary statement to this
Agreement.


 


“Canadian
Borrower” has the meaning assigned thereto in the preliminary statement to
this Agreement.


 


“Canadian
Obligations” means all Obligations of the Canadian Borrower or any
Subsidiary other than the US Borrower or a US Subsidiary.


 


“Cash
Dominion Period” means (a) any period commencing on the date the
Administrative Agent or the Required Lenders shall deliver to the Borrowers a
notice stating that an Event of Default has occurred and is continuing and a
Cash Dominion Period has commenced and ending on the date on which the
Borrowers shall certify in a notice delivered to the Administrative Agent that
no Event of Default is continuing and the Administrative Agent or the Required
Lenders shall deliver to the Borrowers a notice stating that the Cash Dominion
Period has terminated or (b) any period commencing on the date the
Administrative Agent or the Required Lenders shall deliver to the Borrowers a
notice stating that Excess Availability has been less than US$20,000,000 for at
least five consecutive Business Days and a Cash Dominion Period has commenced
and ending on the date on which the Administrative Agent shall determine that
Excess Availability has been greater than US$20,000,000 for at least 30
consecutive days and the Administrative Agent or the Required Lenders shall
deliver to the Borrowers a notice stating that the Cash Dominion Period has
terminated.


 


2

















 


“Cash
Management Services” means treasury management services (including
controlled disbursements, zero balance arrangements, cash sweeps, automated
clearinghouse transactions, return items, overdrafts, temporary advances,
interest and fees and interstate depository network services) provided to
Symmetry, a Borrower or any other Subsidiary.


 


“Cash
Management Services Obligations” of the Loan Parties means any and all
obligations of the Loan Parties, whether absolute or contingent and howsoever
and whensoever created, arising, evidenced or acquired (including all renewals,
extensions and modifications thereof and substitutions therefor) in connection
with Cash Management Services.


 


“Collateral” means all Article 9 Collateral
in which a security interest has been granted hereunder and all Pledged
Collateral.


 


“Collateral
Access Agreement” means any landlord waiver or other agreement, in form and
substance satisfactory to the Administrative Agent, between the Administrative
Agent and any third party (including any bailee, consignee, customs broker, or
other similar Person) in possession of any Collateral or any landlord of any
Loan Party for any real property where any Collateral is located, as such
landlord waiver or other agreement may be amended, restated, or otherwise
modified from time to time.


 


“Copyright License” means any written agreement,
now or hereafter in effect, granting any right to any third party under any
copyright now or hereafter owned by any Grantor or that such Grantor otherwise
has the right to license, or granting any right to any Grantor under any
copyright now or hereafter owned by any third party, and all rights of such
Grantor under any such agreement.


 


“Copyrights” means all of the following now owned
or hereafter acquired by any Grantor: 
(a) all copyright rights in any work subject to the copyright laws
of the United States or any other country, whether as author, assignee,
transferee or otherwise, and (b) all registrations and applications for
registration of any such copyright in the United States or any other country,
including registrations, recordings, supplemental registrations and pending
applications for registration in the United States Copyright Office, including
those listed on Schedule III.


 


“Credit Agreement” has the meaning assigned to
such term in the preliminary statement of this Agreement.


 


“Deposit
Account Control Agreement” means an agreement in form and substance
satisfactory to the Administrative Agent, among any Grantor, a bank or other
financial institution holding such Grantor’s funds, and the Administrative
Agent with respect to collection and control of all deposits and balances held
in a Deposit Account maintained by such Grantor with such bank or other
financial institution.


 


“Excluded
Equity Interests” has the meaning assigned to such term in
Section 3.01(a).


 


3

















 


“Federal Securities Laws” has the meaning assigned
to such term in Section 5.04.


 


“General Intangibles” means all choses in action
and causes of action and all other intangible personal property of every kind
and nature (other than Accounts) now owned or hereafter acquired by any Grantor,
including corporate or other business records, indemnification claims, contract
rights (including rights under leases, whether entered into as lessor or
lessee, Hedging Agreements and other agreements), Intellectual Property,
goodwill, registrations, franchises, tax refund claims and any letter of
credit, guarantee, claim, security interest or other security held by or
granted to any Grantor to secure payment by an Account Debtor of any of the
Accounts.


 


“Grantors” means Symmetry, the Borrowers and the Subsidiary
Parties.


 


“Guarantors” means Symmetry, the US Borrower and
the Subsidiary Parties.


 


“Intellectual Property” means all intellectual and
similar property of every kind and nature now owned or hereafter acquired by
any Grantor, including inventions, designs, Patents, Copyrights, Licenses,
Trademarks, trade secrets, confidential or proprietary technical and business
information, know-how, show-how or other data or information, software and
databases and all embodiments or fixations thereof and related documentation,
registrations and franchises, and all additions, improvements and accessions
to, and books and records describing or used in connection with, any of the
foregoing.


 


“Intercompany
Note Collateral Account” has the meaning assigned to such term in the
Senior Notes Indenture, as in effect on the date hereof.


 


“Intercreditor Agreement” means the Lien
Subordination and Intercreditor Agreement dated as of the date hereof among
Symmetry, the Borrowers, the Administrative Agent and the Non-ABL Collateral
Senior Agent, as amended, supplemented or otherwise modified from time to time.


 


“IP
Security Agreements” means (a) a Patent and Trademark Security Agreement,
in the form of Exhibit II hereto, and (b) a Copyright Security Agreement in the
form of Exhibit III hereto.


 


“License” means any Patent License, Trademark
License, Copyright License or other license or sublicense agreement relating to
intellectual property to which any Grantor is a party, including those listed
on Schedule III.


 


“Loan Documents Obligations” means the obligations
of the Borrowers under the Credit Agreement and of the Borrowers and the other
Loan Parties under the other Loan Documents, including, without limitation,
(a) the due and punctual payment by the Borrowers of (i) the principal
of and interest (including interest accruing during the pendency of any
bankruptcy, insolvency, receivership or similar proceeding, regardless of
whether allowed or allowable in such proceeding) on the Loans (including 


 


4

















 


Swingline
Loans and Protective Advances), when and as due, whether at maturity, by
acceleration, upon one or more dates set for prepayment or otherwise,
(ii) each payment required to be made under the Credit Agreement in
respect of any BA, when and as due, (iii) each payment required to be made
under the Credit Agreement in respect of any Letter of Credit, when and as due,
including payments in respect of reimbursement of disbursements, interest
thereon, and any obligation to provide cash collateral and (iv) all other
monetary obligations of the Borrowers under the Credit Agreement or any other
Loan Document, including in respect of fees, costs, expenses and indemnities,
whether primary, secondary, direct, contingent, fixed or otherwise (including
any monetary obligations incurred during the pendency of any bankruptcy,
insolvency, receivership or similar proceeding, regardless of whether allowed
or allowable in such proceeding), (b) the due and punctual performance of
all other obligations of the Borrowers under or pursuant to the Credit
Agreement and each other Loan Document, and (c) the due and punctual
payment and performance of all of the obligations of each other Loan Party
under or pursuant to each of the other Loan Documents.


 


“Lockbox Agreement” means an agreement in form and
substance reasonably satisfactory to the Administrative Agent, among a US
Grantor, the Administrative Agent and a bank or other financial institution,
pursuant to which such bank or other financial institution has agreed to
establish and maintain a United States Post Office lockbox into which payments
on Accounts or in respect of Inventory of such US Grantor shall be made, to
retrieve and process all checks and other evidences of payment so received at
such lockbox and to deposit the same into a Deposit Account of such US Grantor
over which the Administrative Agent has Control within the meaning of
Section 9-104 of the New York UCC.


 


“Lockbox System” has the meaning assigned to such
term in Section 4.06(b).


 


“New York UCC” means the Uniform Commercial Code
as from time to time in effect in the State of New York.


 


“Non-ABL Collateral” means all Collateral that is
not ABL Collateral.


 


“Non-ABL
Collateral Senior Agent” means the Senior Notes Collateral Agent and any Person
that, under the terms of the Intercreditor Agreement, is a Senior Agent (as
defined in the Intercreditor Agreement) with respect to the Non-ABL Collateral.


 


“Non-US Grantor” means any Grantor that is a CFC.


 


“Non-US Guarantor” means any Guarantor that is a
CFC.


 


“Notes
Collateral Account” has the meaning assigned to such term in the Senior
Notes Indenture, as in effect on the date hereof.


 


“Obligations” means (a) Loan Documents
Obligations, (b) the due and punctual payment and performance of all obligations
of each Loan Party under each 


 


5

















 


Hedging
Agreement that (i) is in effect on the Effective Date with a counterparty
that is a Lender or an Affiliate of a Lender as of the Effective Date or
(ii) is entered into after the Effective Date with any counterparty that
is a Lender or an Affiliate of a Lender at the time such Hedging Agreement is
entered into and (c) the due and punctual payment and performance of all
Cash Management Services Obligations of each Loan Party (i) owed on the
Effective Date to a Person that is a Lender or an Affiliate of a Lender as of
the Effective Date or (ii) owed to a Person that is a Lender or an
Affiliate of a Lender at the time such Cash Management Services Obligations are
incurred.


 


“Patent License” means any written agreement, now
or hereafter in effect, granting to any third party any right to make, use or
sell any invention on which a patent, now or hereafter owned by any Grantor or
that any Grantor otherwise has the right to license, is in existence, or
granting to any Grantor any right to make, use or sell any invention on which a
patent, now or hereafter owned by any third party, is in existence, and all
rights of any Grantor under any such agreement.


 


“Patents” means all of the following now owned or
hereafter acquired by any Grantor: 
(a) all letters patent of the United States or the equivalent
thereof in any other country, all registrations and recordings thereof, and all
applications for letters patent of the United States or the equivalent thereof
in any other country, including registrations, recordings and pending
applications in the United States Patent and Trademark Office or any similar
offices in any other country, including those listed on Schedule III, and
(b) all reissues, continuations, divisions, continuations-in-part,
renewals or extensions thereof, and the inventions disclosed or claimed
therein, including the right to make, use and/or sell the inventions disclosed
or claimed therein.


 


“Pledged Collateral” has the meaning assigned to
such term in Section 3.01.


 


“Pledged Debt Securities” has the meaning assigned
to such term in Section 3.01.


 


“Pledged Equity Interests” has the meaning
assigned to such term in Section 3.01.


 


“Pledged Securities” means any promissory notes,
stock certificates or other securities certificates or instruments now or
hereafter included in the Pledged Collateral, including all certificates,
instruments or other documents representing or evidencing any Pledged
Collateral.


 


“Proceeds” has the meaning assigned to such term
in Section 9-102 of the New York UCC.


 


“Secured Parties” means (a) the Lenders,
(b) the Administrative Agent, (c) each Issuing Bank, (d) each
counterparty to any Hedging Agreement with a Loan Party the obligations under
which constitute Obligations, (e) each Person to whom any Cash Management
Services Obligations that constitute Obligations are owed, (f) the 


 


6

















 


beneficiaries
of each indemnification obligation undertaken by any Loan Party under any Loan
Document and (g) the successors and assigns of each of the foregoing.


 


“Security Interest” means, collectively, the
security interests created under paragraphs (a) and (b) of
Section 4.01.


 


“Senior
Notes Collateral Agent” means The Bank of New York, as the collateral agent
under the Senior Notes Documents, or any other Person serving in such capacity.


 


“Sub-Agent” means a financial institution that has
delivered to the Administrative Agent an executed Lockbox Agreement.


 


“Subsidiary Parties” means (a) the
Subsidiaries identified on Schedule I(1) and (b) each other
Subsidiary that becomes a party to this Agreement as a Subsidiary Party after
the Effective Date.


 


“Symmetry”
has the meaning assigned thereto in the preliminary statement to this
Agreement.


 


“Trademark License” means any written agreement,
now or hereafter in effect, granting to any third party any right to use any
trademark now or hereafter owned by any Grantor or that any Grantor otherwise
has the right to license, or granting to any Grantor any right to use any
trademark now or hereafter owned by any third party, and all rights of any
Grantor under any such agreement.


 


“Trademarks” means all of the following now owned
or hereafter acquired by any Grantor: (a) all trademarks, service marks,
trade names, corporate names, company names, business names, fictitious
business names, trade styles, trade dress, logos, other source or business
identifiers, designs and general intangibles of like nature, now existing or hereafter
adopted or acquired, all registrations and recordings thereof, and all
registration and recording applications filed in connection therewith,
including registrations and registration applications in the United States
Patent and Trademark Office or any similar offices in any State of the United
States or any other country or any political subdivision thereof, and all
extensions or renewals thereof, including those listed on Schedule III,
(b) all goodwill associated therewith or symbolized thereby and (c) all
other assets, rights and interests that uniquely reflect or embody such
goodwill.


 


“US
Borrower” has the meaning assigned thereto in the preliminary statement to
this Agreement.


 


“US Grantor” means each Grantor other than the
Non-US Grantors.


 


“US Guarantor” means each Guarantor other than the
Non-US Guarantors.


 






(1)  The listed entities will not include the
Borrowers.


 


7

















 


“US Obligations” means all Obligations of
Symmetry, the US Borrower and the US Subsidiaries.


 


(c)  As used in this Agreement, the terms Grantor
and Guarantor shall have the meanings assigned thereto in paragraph (b) of this
Section, and shall not be interpreted to refer to any Person solely in its
capacity as a grantor of the security interests hereunder or a guarantor of any
of the Obligations.


 


ARTICLE II


 


Guarantee


 


SECTION 2.01. Guarantee.
Each US Guarantor unconditionally guarantees, jointly with the other Guarantors
and severally, as a primary obligor and not merely as a surety, the due and
punctual payment and performance of the Obligations. Each Non-US Guarantor
unconditionally guarantees, jointly with the other Guarantors and severally, as
a primary obligor and not merely as a surety, the due and punctual payment and
performance of the Canadian Obligations. Each of the Guarantors further agrees
that the Obligations may be extended or renewed, in whole or in part, without
notice to or further assent from it, and that it will remain bound upon its
guarantee notwithstanding any extension or renewal of any of the Obligations. Each
of the Guarantors waives presentment to, demand of payment from and protest to
either Borrower or any other Loan Party of any of the Obligations, and also
waives notice of acceptance of its guarantee and notice of protest for
nonpayment.


 


SECTION 2.02. Guarantee
of Payment. Each of the Guarantors further agrees that its guarantee
hereunder constitutes a guarantee of payment when due and not of collection,
and waives any right to require that any resort be had by the Administrative
Agent or any other Secured Party to any security held for the payment of the
Obligations or to any balance of any deposit account or credit on the books of
the Administrative Agent or any other Secured Party in favor of either Borrower
or any other Person.


 


SECTION 2.03. No
Limitations.  (a)  Except for termination and release of a
Guarantor’s obligations hereunder as expressly provided in Section 7.13,
the obligations of each Guarantor hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason, including any
claim of waiver, release, surrender, alteration or compromise, and shall not be
subject to any defense or set-off, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of the
Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of each Guarantor hereunder shall not be discharged or impaired or
otherwise affected by (i) the failure of the Administrative Agent or any
other Secured Party to assert any claim or demand or to enforce any right or
remedy under the provisions of any Loan Document or otherwise; (ii) any
rescission, waiver, amendment or modification of, or any release from any of
the terms or provisions of, any Loan Document or any other agreement, including
with respect to any other Guarantor under this Agreement; (iii) the
release of any security held by the Administrative Agent or any other Secured
Party for the Obligations or any of them; (iv) any default, failure or
delay,


 


8





















 


wilful or otherwise, in the performance of
the Obligations; or (v) any other act or omission that may or might in any
manner or to any extent vary the risk of any Guarantor or otherwise operate as
a discharge of any Guarantor as a matter of law or equity (other than the
indefeasible payment in full in cash of all the Obligations). Each Guarantor
expressly authorizes the Secured Parties to take and hold security for the
payment and performance of the Obligations, to exchange, waive or release any
or all such security (with or without consideration), to enforce or apply such
security and direct the order and manner of any sale thereof in their sole
discretion or to release or substitute any one or more other guarantors or
obligors upon or in respect of the Obligations, all without affecting the
obligations of any Guarantor hereunder.


 


(b)  To the fullest extent permitted by applicable
law, each Guarantor waives any defense based on or arising out of any defense
of either Borrower or any other Loan Party or the unenforceability of the
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of either Borrower or any other Loan Party, other than the
indefeasible payment in full in cash of all the Obligations. The Administrative
Agent and the other Secured Parties may, at their election, foreclose on any
security held by one or more of them by one or more judicial or nonjudicial
sales, accept an assignment of any such security in lieu of foreclosure,
compromise or adjust any part of the Obligations, make any other accommodation
with either Borrower or any other Loan Party or exercise any other right or
remedy available to them against either Borrower or any other Loan Party,
without affecting or impairing in any way the liability of any Guarantor
hereunder except to the extent the Obligations have been fully and indefeasibly
paid in full in cash or the guarantee of such Guarantor has been terminated and
released pursuant to Section 7.13. To the fullest extent permitted by
applicable law, each Guarantor waives any defense arising out of any such
election even though such election operates, pursuant to applicable law, to
impair or to extinguish any right of reimbursement or subrogation or other
right or remedy of such Guarantor against either Borrower or any other Loan
Party, as the case may be, or any security.


 


SECTION 2.04. Reinstatement.
Each of the Guarantors agrees that its guarantee hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any Obligation guaranteed by it is rescinded or must otherwise
be restored by the Administrative Agent or any other Secured Party upon the
bankruptcy or reorganization of the Borrower, any other Loan Party or
otherwise.


 


SECTION 2.05. Agreement
to Pay; Subrogation.  In
furtherance of the foregoing and not in limitation of any other right that the
Administrative Agent or any other Secured Party has at law or in equity against
any Guarantor by virtue hereof, upon the failure of either Borrower or any
other Loan Party to pay any Obligation when and as the same shall become due,
whether at maturity, by acceleration, after notice of prepayment or otherwise,
each Guarantor that has guaranteed such Obligation hereby promises to and will
forthwith pay, or cause to be paid, to the Administrative Agent for
distribution to the applicable Secured Parties in cash the amount of such
unpaid Obligation. Upon payment by any Guarantor of any sums to the
Administrative Agent as provided above, all rights of such Guarantor against
the Borrower or any other Loan


 


9





















 


Party arising as a result thereof by way of right
of subrogation, contribution, reimbursement, indemnity or otherwise shall in
all respects be subject to Article VI.


 


SECTION 2.06. Information.
Each Guarantor assumes all responsibility for being and keeping itself informed
of the Borrower’s and each other Loan Party’s financial condition and assets,
and of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature, scope and extent of the risks that such Guarantor
assumes and incurs hereunder, and agrees that none of the Administrative Agent
or the other Secured Parties will have any duty to advise such Guarantor of
information known to it or any of them regarding such circumstances or risks.


 


ARTICLE III


 


Pledge of Securities


 


SECTION 3.01. Pledge.
As security for the payment or performance, as the case may be, in full of
the Obligations, each US Grantor hereby assigns and pledges to the
Administrative Agent, its successors and assigns, for the benefit of the
Secured Parties, and hereby grants to the Administrative Agent, its successors
and assigns, for the benefit of the Secured Parties, a security interest in,
all of such US Grantor’s right, title and interest in, to and under the
following assets:


 


(a) the shares of capital stock and other Equity Interests owned by
such US Grantor on the date hereof (including those listed opposite the name of
such US Grantor on Schedule II), any other Equity Interests obtained by
such US Grantor in the future and the certificates representing all such Equity
Interests (the “Pledged Equity Interests”); provided that
(i) the Pledged Equity Interests issued by any CFC, insofar as they secure
US Obligations, shall not include more than 66% of the issued and outstanding
voting Equity Interests of such CFC (it being understood and agreed that the
limitation in this clause (i) shall not apply insofar as any such Pledged
Equity Interests secure Canadian Obligations) and (ii) the Pledged Equity
Interests shall not include Equity Interests in any Person that is not a
wholly-owned Subsidiary (or in any Special Purpose Holdco with respect to such
Person) where, pursuant to the organizational documents of such Person and any
related joint venture or similar agreement, such assignment, pledge or grant of
a security interest is prohibited without the consent of the equityholders of
such Person (other than Symmetry or any of its Subsidiaries) (the Equity
Interests so excluded are collectively referred to herein as the “Excluded
Equity Interests”);


 


(b) the debt securities owned by such US Grantor on the date hereof
(including the Intercompany Note and those listed opposite the name of such US
Grantor on Schedule II), any debt securities obtained by such US Grantor
in the future and the promissory notes and any other instruments evidencing all
such debt securities (the “Pledged Debt Securities”);


 


(c) all other property that may be delivered to and held by the
Administrative Agent pursuant to the terms of this Section;


 


10





















 


(d) subject to Section 3.06, all payments of principal or
interest, dividends, cash, instruments and other property from time to time
received, receivable or otherwise distributed in respect of, in exchange for or
upon the conversion of, and all other Proceeds received in respect of, the securities
referred to in clauses (a) and (b) above;


 


(e) subject to Section 3.06, all rights and privileges of such US
Grantor with respect to the securities and other property referred to in
clauses (a), (b), (c) and (d) above; and


 


(f) all Proceeds of any of the foregoing


 


(the items referred to in the foregoing
clauses (a) through (f) above being collectively referred to as the “Pledged
Collateral”).


 


TO HAVE AND TO
HOLD the Pledged Collateral, together with all right, title, interest, powers,
privileges and preferences pertaining or incidental thereto, unto the
Administrative Agent, its successors and assigns, for the benefit of the
Secured Parties, forever; subject,
however, to the terms,
covenants and conditions hereinafter set forth.


 


SECTION 3.02. Delivery
of the Pledged Collateral. (a)  Each US Grantor agrees promptly to deliver or
cause to be delivered to the Administrative Agent any and all Pledged
Securities at any time owned by such US Grantor.


 


(b)  Each US Grantor will cause any Indebtedness for
borrowed money owed to such US Grantor by any Person (other than any Investment
Property on deposit with a securities intermediary) to be evidenced by a duly
executed promissory note that is pledged and delivered to the Administrative
Agent pursuant to the terms hereof.


 


(c)  Upon delivery to the Administrative Agent (or
the Non-ABL Collateral Senior Agent, as its bailee for purposes of perfection),
(i) any Pledged Securities shall be accompanied by stock powers duly
executed in blank or other instruments of transfer satisfactory to the
Administrative Agent and by such other instruments and documents as the
Administrative Agent may reasonably request and (ii) all other property
comprising part of the Pledged Collateral shall be accompanied by proper instruments
of assignment duly executed by the applicable US Grantor and such other
instruments or documents as the Administrative Agent may reasonably request. Each
delivery of Pledged Securities after the date of this Agreement shall be
accompanied by a schedule describing the Pledged Securities so delivered, which
schedule shall be attached hereto and shall become part of Schedule II hereto; provided
that failure to attach any such schedule shall not affect the validity of the
pledge of such Pledged Securities.


 


(d)  The assignment, pledges and security
interests granted in Section 3.01 are granted as security only and shall
not subject the Administrative Agent or any other Secured Party to, or in any
way alter or modify, any obligation or liability of any US Grantor with respect
to or arising out of the Pledged Collateral.


 


11





















 


SECTION 3.03. Representations,
Warranties and Covenants. The US Grantors jointly and
severally represent, warrant and covenant to and with the Administrative Agent,
for the benefit of the Secured Parties, that:


 


(a) Schedule II sets forth, as of the date hereof, a true and complete
list, with respect to each US Grantor, of (i) all the Equity Interests
owned by such US Grantor, setting forth the percentage of the issued and
outstanding units of each class of the Equity Interests of the issuer thereof
so owned by such US Grantor and the number of each certificate representing the
same, and (ii) all debt securities owned by such US Grantor, setting forth
all promissory notes and other instruments evidencing the same;


 


(b) the Pledged Equity Interests and Pledged Debt Securities have been
duly and validly authorized and issued by the issuers thereof and (i) in
the case of Pledged Equity Interests, are fully paid and nonassessable and
(ii) in the case of Pledged Debt Securities, are legal, valid and binding
obligations of the issuers thereof, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’
rights generally and subject to general principles of equity, regardless of
whether considered in a proceeding in equity or at law;


 


(c) except for the security interests granted hereunder, each US
Grantor (i) is and, subject to any transfers made in compliance with the
Credit Agreement, will continue to be the direct owner, beneficially and of
record, of the Pledged Securities indicated on Schedule II as owned by such US
Grantor, (ii) holds the same free and clear of all Liens, other than Liens
created by this Agreement, Liens created by the Senior Notes Documents,
Permitted Encumbrances and transfers made in compliance with the Credit
Agreement, and (iii) will defend its title or interest thereto or therein
against any and all Liens (other than the Lien created by this Agreement, Liens
created by the Senior Notes Documents and Permitted Encumbrances), however,
arising, of all Persons whomsoever;


 


(d) except for restrictions and limitations imposed by the Loan
Documents, the Senior Notes Documents, the Intercreditor Agreement or
securities laws generally, (i) the Pledged Collateral is and will continue
to be freely transferable and assignable and (ii) none of the Pledged
Collateral is or will be subject to any option, right of first refusal, shareholders
agreement, charter or bylaw provisions or contractual restriction of any nature
that might prohibit, impair, delay or otherwise affect the pledge of such
Pledged Collateral hereunder, the sale or disposition thereof pursuant hereto
or the exercise by the Administrative Agent of rights and remedies hereunder,
other than, in the case of any Pledged Collateral constituting Equity Interests
in, or debt securities of, any Person that is not a wholly-owned Subsidiary,
any of the foregoing restrictions and limitations set forth in the
organizational documents or any related joint venture or similar agreements of
such Person (to the extent such restrictions and limitations cannot be waived
without the prior consent of any Person other than Symmetry or any Subsidiary);


 


12





















 


(e) each of the US Grantors has the power and authority to pledge the
Pledged Collateral pledged by it hereunder in the manner hereby done or
contemplated;


 


(f) no consent or approval of any Governmental Authority, any
securities exchange or any other Person was or is necessary to the validity of
the pledge effected hereby (other than such as have been obtained and are in
full force and effect);


 


(g) by virtue of the execution and delivery by the US Grantors of this
Agreement, when any Pledged Securities are delivered to the Administrative
Agent (or the Non-ABL Collateral Senior Agent, as its bailee for purposes of
perfection) in accordance with this Agreement, the Administrative Agent will
obtain a legal, valid and perfected lien upon and security interest in such
Pledged Securities as security for the payment and performance of the
Obligations; and


 


(h) the pledge effected hereby is effective to vest in the
Administrative Agent, for the benefit of the Secured Parties, the rights of the
Administrative Agent in the Pledged Collateral as set forth herein.


 


SECTION 3.04. Certification
of Limited Liability Company and Limited Partnership Interests.
Each Grantor agrees that, no later than the 30th day following the Effective
Date and at all times thereafter, each interest in any limited liability
company or limited partnership controlled by such Grantor and pledged hereunder
shall be represented by a certificate, shall be a “security” within the meaning
of Article 8 of the New York UCC and shall be governed by Article 8
of the New York UCC.


 


SECTION 3.05. Registration
in Nominee Name; Denominations. The Administrative
Agent, on behalf of the Secured Parties, shall have the right (in its sole and
absolute discretion) to hold the Pledged Securities in its own name as pledgee,
the name of its nominee (as pledgee or as sub-agent) or the name of the
applicable US Grantor, endorsed or assigned in blank or in favor of the
Administrative Agent. Each US Grantor will promptly give to the Administrative
Agent copies of any notices or other communications received by it with respect
to Pledged Securities registered in the name of such US Grantor. The
Administrative Agent shall at all times have the right to exchange the certificates
representing Pledged Securities for certificates of smaller or larger
denominations for any purpose consistent with this Agreement.


 


SECTION 3.06. Voting
Rights; Dividends and Interest.  (a)  Unless and until an Event of Default shall
have occurred and be continuing and the Administrative Agent shall have
notified the US Grantors that their rights under this Section are being
suspended:


 


(i) Each US Grantor shall be entitled to exercise any and all voting
and other consensual rights and powers inuring to an owner of Pledged Equity
Interests or Pledged Debt Securities or any part thereof for any purpose
consistent with the terms of this Agreement, the Credit Agreement and the other
Loan


 


13





















 


Documents; provided
that such rights and powers shall not be exercised in any manner that could
reasonably be expected to materially and adversely affect the rights inuring to
an owner of any Pledged Equity Interests or Pledged Debt Securities or the
rights and remedies of the Administrative Agent or the other Secured Parties
under this Agreement, the Credit Agreement or any other Loan Document or the
ability of Administrative Agent or the other Secured Parties to exercise the
same.


 


(ii) The Administrative Agent shall execute and deliver to each US
Grantor, or cause to be executed and delivered to such US Grantor, all such
proxies, powers of attorney and other instruments as such US Grantor may
reasonably request for the purpose of enabling such US Grantor to exercise the
voting and/or consensual rights and powers it is entitled to exercise pursuant
to paragraph (i) above.


 


(iii) Each US Grantor shall be entitled to receive and retain any and
all dividends, interest, principal and other distributions paid on or
distributed in respect of the Pledged Equity Interests and Pledged Debt
Securities to the extent and only to the extent that such dividends, interest,
principal and other distributions are permitted by, and otherwise paid or
distributed in accordance with, the terms and conditions of the Credit
Agreement, the other Loan Documents and applicable laws; provided that
any noncash dividends, interest, principal or other distributions that would
constitute Pledged Equity Interests or Pledged Debt Securities, whether resulting
from a subdivision, combination or reclassification of the outstanding Equity
Interests of the issuer of any Pledged Securities or received in exchange for
Pledged Securities or any part thereof, or in redemption thereof, or as a
result of any merger, consolidation, acquisition or other exchange of assets to
which such issuer may be a party or otherwise, shall be and become part of the
Pledged Collateral, and, if received by any US Grantor, shall not be commingled
by such US Grantor with any of its other funds or property but shall be held
separate and apart therefrom, shall be held in trust for the benefit of the
Administrative Agent and shall be forthwith delivered to the Administrative
Agent in the form in which it shall have been so received (with any necessary
endorsement).


 


(b)  Upon the occurrence and during the
continuance of an Event of Default, after the Administrative Agent shall have
notified the US Grantors of the suspension of their rights under
paragraph (a)(iii) of this Section, then all rights of any US Grantor to
dividends, interest, principal or other distributions that such US Grantor is
authorized to receive pursuant to paragraph (a)(iii) of this Section shall
cease, and all such rights shall thereupon become vested in the Administrative
Agent, which shall have the sole and exclusive right and authority to receive
and retain such dividends, interest, principal or other distributions. All
dividends, interest, principal or other distributions received by any US
Grantor contrary to the provisions of this Section shall be held in trust for
the benefit of the Administrative Agent, shall be segregated from other
property or funds of such US Grantor and shall be forthwith delivered to the
Administrative Agent upon demand in the same form as so received (with any
necessary endorsement). Any 


 


14





















 


and all money and other property paid over to
or received by the Administrative Agent pursuant to the provisions of this
paragraph (b) shall be retained by the Administrative Agent in an account
to be established by the Administrative Agent upon receipt of such money or
other property and shall be applied in accordance with the provisions of
Section 5.02. After all Events of Default have been cured or waived and
the Administrative Agent shall have received a certificate of a Financial
Officer of Symmetry to that effect, the Administrative Agent shall, promptly
repay to each US Grantor (without interest) all dividends, interest, principal
or other distributions that such US Grantor would otherwise be permitted to
retain pursuant to the terms of paragraph (a)(iii) of this Section and
that remain in such account.


 


(c)  Upon the occurrence and during the
continuance of an Event of Default, after the Administrative Agent shall have
notified the US Grantors of the suspension of their rights under
paragraph (a)(i) of this Section, all rights of any US Grantor to exercise
the voting and consensual rights and powers it is entitled to exercise pursuant
to paragraph (a)(i) of this Section, and the obligations of the
Administrative Agent under paragraph (a)(ii) of this Section, shall cease,
and all such rights shall thereupon become vested in the Administrative Agent,
which shall have the sole and exclusive right and authority to exercise such
voting and consensual rights and powers; provided that, unless otherwise
directed by the Required Lenders, the Administrative Agent shall have the right
from time to time following the occurrence and during the continuance of an
Event of Default to permit the US Grantors to exercise such rights.


 


(d)  Any notice given by the Administrative Agent
to the US Grantors suspending their rights under paragraph (a) of this
Section (i) may be given by telephone if promptly confirmed in writing, (ii) may
be given to one or more of the US Grantors at the same or different times and
(iii) may suspend the rights of the US Grantors under
paragraph (a)(i) or paragraph (a)(iii) in part without suspending all
such rights (as specified by the Administrative Agent in its sole and absolute
discretion) and without waiving or otherwise affecting the Administrative Agent’s
rights to give additional notices from time to time suspending other rights so
long as an Event of Default has occurred and is continuing.


 


ARTICLE IV


 


Security Interests in Personal Property


 


SECTION 4.01. Security
Interest. (a) 
As security for the payment or performance, as the case may be, in full
of the Obligations, each US Grantor hereby assigns and pledges to the
Administrative Agent, its successors and assigns, for the benefit of the
Secured Parties, and hereby grants to the Administrative Agent, its successors
and assigns, for the benefit of the Secured Parties, a security interest in,
all right, title and interest in, to or under any and all of the Article 9
Collateral now owned or at any time hereafter acquired by such US Grantor or in
which such US Grantor now has or at any time in the future may acquire any
right, title or interest, other than any portion thereof constituting the Excluded
Equity Interests.


 


15





















 


(b)  As security for the payment or performance,
as the case may be, in full of the Canadian Obligations, each Non-US Grantor
hereby assigns and pledges to the Administrative Agent, its successors and
assigns, for the benefit of the Secured Parties, and hereby grants to the
Administrative Agent, its successors and assigns, for the benefit of the
Secured Parties, a security interest in, all right, title and interest in, to
or under any and all of the ABL Collateral now owned or at any time hereafter
acquired by such Non-US Grantor or in which such Non-US Grantor now has or at
any time in the future may acquire any right, title or interest.


 


(c)  Each Grantor hereby irrevocably authorizes
the Administrative Agent at any time and from time to time to file in any
relevant jurisdiction any initial financing statements (including fixture
filings) with respect to the Article 9 Collateral in which a security
interest is created by such Grantor hereunder or any part thereof and
amendments thereto that (i) identify the applicable Collateral (including,
in the case of any US Grantor, by indicating the Collateral to be “all assets”
of such Grantor or words of similar effect as being of an equal or lesser scope
or with greater detail) and (ii) contain the information required by
Article 9 of the Uniform Commercial Code or other applicable law of each
applicable jurisdiction for the filing of any financing statement or amendment,
including (A) whether such Grantor is an organization, the type of organization
and any organizational identification number issued to such Grantor and (B) in
the case of a financing statement filed as a fixture filing or covering
Article 9 Collateral constituting minerals or the like to be extracted or
timber to be cut, a sufficient description of the real property to which such
Article 9 Collateral relates. Each Grantor agrees to provide such
information to the Administrative Agent promptly upon request.


 


Each Grantor
also ratifies its authorization for the Administrative Agent to file in any
relevant jurisdiction any initial financing statements or amendments thereto if
filed prior to the date hereof.


 


The
Administrative Agent is further authorized to file with the United States
Patent and Trademark Office or United States Copyright Office (or any successor
office or any similar office in any other country) such documents as may be
necessary or advisable for the purpose of perfecting, confirming, continuing,
enforcing or protecting the Security Interest granted by each Grantor, without
the signature of any Grantor, and naming any Grantor or the Grantors as debtors
and the Administrative Agent as secured party.


 


(d)  The Security Interest is granted as security
only and shall not subject the Administrative Agent or any other Secured Party
to, or in any way alter or modify, any obligation or liability of any Grantor
with respect to or arising out of the Article 9 Collateral.


 


(e)  Notwithstanding anything herein to the
contrary, in no event shall the security interest granted hereunder attach to
any contract or agreement to which any Grantor is a party or any of its rights
or interests thereunder if and for so long as the grant of such security
interest shall constitute or result in (i) the unenforceability of any
right of such Grantor thereunder or (ii) a breach or termination under the
terms of, or a default


 


16





















 


under, any such contract or agreement (other
than to the extent that any such term would be rendered ineffective pursuant to
Sections 9-406, 9-407, 9-408 or 9-409 of the New York UCC or any other
applicable law or principles of equity), provided, that such security
interest shall attach immediately at such time as the condition causing such
unenforceability, breach or termination shall be remedied or shall otherwise
cease to exist and, to the extent severable, shall attach immediately to any
portion of such contract or agreement that does not result in any of the
consequences specified in this paragraph, including any Proceeds of such
contract or agreement.


 


SECTION 4.02. Representations
and Warranties. The Grantors jointly and severally
represent and warrant to the Administrative Agent and the Secured Parties that:


 


(a) Each Grantor has good and valid rights in and title to the
Article 9 Collateral with respect to which it has purported to grant a
Security Interest hereunder and has full power and authority to grant to the
Administrative Agent the Security Interest in such Article 9 Collateral
pursuant hereto and to execute, deliver and perform its obligations in
accordance with the terms of this Agreement, without the consent or approval of
any other Person (other than any consent or approval that has been obtained).


 


(b) The Perfection Certificate has been duly prepared, completed and
executed, and the information set forth therein, including the exact legal name
of each Grantor, is correct and complete as of the Effective Date.


 


(c) Schedule III hereto sets forth, as of the date hereof, for each US
Grantor, (i) all United States registered Patents and Patent applications
owned by such US Grantor, including the name of the registered owner, type,
registration or application number and the expiration date (if already registered)
thereof, (ii) all United States registered Trademarks and Trademark
applications owned by such US Grantor, including the name of the registered
owner, the registration or application number and the expiration date (if
already registered) thereof, and (iii) all United States registered
Copyrights and Copyright applications owned by such US Grantor, including the
name of the registered owner, title and, if applicable, the registration number
of each such Copyright or Copyright application.


 


(d) Schedule IV hereto sets forth, as of the date hereof, each
Commercial Tort Claim in respect of which a complaint or a counterclaim has
been filed by any US Grantor seeking damages in an amount of US$1,000,000 or
more.


 


SECTION 4.03. Covenants.
(a)  Each Grantor agrees to maintain, at
its own cost and expense, complete and accurate records with respect to the
Article 9 Collateral owned by it, and in which it has granted a security
interest hereunder, in accordance with GAAP and applicable law, and, at such
time or times as the Administrative Agent may reasonably request, promptly to
prepare and deliver to the Administrative Agent a duly certified schedule or
schedules in form and detail 


 


17





















 


satisfactory to the Administrative Agent
showing the identity, amount and location of any and all such Article 9
Collateral.


 


(b)  Each Grantor shall, at its own expense, take
any and all actions necessary to defend title to the Article 9 Collateral
in which it has granted a security interest hereunder against all Persons and
to defend the Security Interest of the Administrative Agent in such
Article 9 Collateral and the priority thereof against any Lien not
expressly permitted pursuant to Section 6.02 of the Credit Agreement.


 


(c)  Each Grantor agrees, at its own expense, to
execute, acknowledge, deliver and cause to be duly filed all such further
instruments and documents and take all such actions as the Administrative Agent
may from time to time reasonably request to better assure, preserve, protect
and perfect the Security Interest and the rights and remedies created hereby,
including the payment of any fees and taxes required in connection with the
execution and delivery of this Agreement, the granting of the Security Interest
and the filing of any financing statements (including fixture filings) or other
documents in connection herewith or therewith.


 


Without
limiting the generality of the foregoing, each US Grantor hereby authorizes the
Administrative Agent, with prompt notice thereof to the US Grantors, to
supplement this Agreement by supplementing Schedule III or adding
additional schedules hereto to specifically identify any asset or item that may
constitute Copyrights, Licenses, Patents or Trademarks; provided that any US Grantor shall
have the right, exercisable within 10 days after it has been notified by
the Administrative Agent of the specific identification of such Collateral, to
advise the Administrative Agent in writing of any inaccuracy of the
representations and warranties made by such US Grantor hereunder with respect
to such Collateral. Each US Grantor agrees that it will use its best efforts to
take such action as shall be necessary in order that all representations and
warranties hereunder shall be true and correct with respect to such Collateral
within 30 days after the date it has been notified by the Administrative
Agent of the specific identification of such Collateral.


 


(d)  The Administrative Agent and such Persons as
the Administrative Agent may reasonably designate shall have the right, at the
Grantors’ own cost and expense, to inspect the Article 9 Collateral
subject to the Security Interest, all records related thereto (and to make
extracts and copies from such records) and the premises upon which any of such
Article 9 Collateral is located, to discuss the Grantors’ affairs with the
officers of the Grantors and their independent accountants and to verify under
reasonable procedures, in accordance with Section 5.09 of the Credit
Agreement, the validity, amount, quality, quantity, value, condition and status
of, or any other matter relating to, the Article 9 Collateral subject to the
Security Interest, including, in the case of Accounts or Article 9
Collateral in the possession of any third person, by contacting Account Debtors
or the third person possessing such Article 9 Collateral for the purpose
of making such a verification. The Administrative Agent shall have the absolute
right to share any information it gains from such inspection or verification
with any Secured Party.


 


18





















 


(e)  At its option, the Administrative Agent may
discharge past due taxes, assessments, charges, fees or Liens at any time
levied or placed on the Article 9 Collateral and not permitted pursuant to
Section 6.02 of the Credit Agreement, and may pay for the maintenance and
preservation of the Article 9 Collateral subject to the Security Interest
to the extent any Grantor fails to do so as required by the Credit Agreement or
this Agreement, and each US Grantor jointly and severally agrees to reimburse
the Administrative Agent on demand for any payment made or any expense incurred
by the Administrative Agent pursuant to the foregoing authorization (and each
Non-US Grantor jointly and severally agrees to so reimburse for any such
payment made or expense incurred on account of any Non-US Grantor); provided
that nothing in this paragraph shall be interpreted as excusing any Grantor
from the performance of, or imposing any obligation on the Administrative Agent
or any other Secured Party to cure or perform, any covenants or other promises
of any Grantor with respect to taxes, assessments, charges, fees or Liens and
maintenance of properties as set forth herein or in the other Loan Documents.


 


(f)  If at any time any Grantor shall take a
security interest in any property of an Account Debtor or any other Person to
secure payment and performance of an Account, such Grantor shall promptly
assign such security interest to the Administrative Agent, for the benefit of
the Secured Parties. Such assignment need not be filed of public record unless
necessary to continue the perfected status of the security interest against
creditors of and transferees from the Account Debtor or other Person granting
the security interest.


 


(g)  Each Grantor shall remain liable to observe
and perform all the conditions and obligations to be observed and performed by
it under each contract, agreement or instrument relating to the Article 9
Collateral subject to the Security Interest, all in accordance with the terms
and conditions thereof, and each US Grantor jointly and severally agrees to
indemnify and hold harmless the Administrative Agent and the other Secured
Parties from and against any and all liability for such performance (and each
Non-US Grantor jointly and severally agrees to so indemnify and hold harmless
from and against any and all liability for such performance on account of any
Non-US Grantor).


 


(h)  None of the Grantors shall make or permit to
be made an assignment, pledge or hypothecation of the Article 9 Collateral
subject to the Security Interest or shall grant any other Lien in respect of
such Article 9 Collateral, except as permitted by the Credit Agreement. None of
the Grantors shall make or permit to be made any transfer of such Article 9
Collateral and each Grantor shall remain at all times in possession of such
Article 9 Collateral owned by it, except that unless and until the
Administrative Agent shall notify the Grantors that an Event of Default shall
have occurred and be continuing and that during the continuance thereof the
Grantors shall not sell, convey, lease, assign, transfer or otherwise dispose
of any such Article 9 Collateral (which notice may be given by telephone if
promptly confirmed in writing), the Grantors may use and dispose of such
Article 9 Collateral in any lawful manner not inconsistent with the provisions
of this Agreement, the Credit Agreement or any other Loan Document.


 


19
















 


(i)  None of the Grantors will, without the
Administrative Agent’s prior written consent, grant any extension of the time
of payment of any Accounts included in the Article 9 Collateral,
compromise, compound or settle the same for less than the full amount thereof,
release, wholly or partly, any Person liable for the payment thereof or allow
any credit or discount whatsoever thereon, other than extensions, compromises,
settlements, releases, credits or discounts granted or made in the ordinary
course of business and consistent with its current practices and in accordance
with such prudent and standard practice used in industries that are the same as
or similar to those in which such Grantor is engaged.


 


(j)  The Grantors, at their own expense, shall
maintain or cause to be maintained insurance covering physical loss or damage
to the Inventory and Equipment subject to the Security Interest in accordance
with the requirements set forth in Section 5.07 of the Credit Agreement. Each
Grantor irrevocably makes, constitutes and appoints the Administrative Agent
(and all officers, employees or agents designated by the Administrative Agent)
as such Grantor’s true and lawful agent (and attorney-in-fact) for the purpose,
during the continuance of an Event of Default, of making, settling and
adjusting claims in respect of Article 9 Collateral subject to the
Security Interest under policies of insurance, endorsing the name of such
Grantor on any check, draft, instrument or other item of payment for the
proceeds of such policies of insurance and for making all determinations and
decisions with respect thereto. In the event that any Grantor at any time or
times shall fail to obtain or maintain any of the policies of insurance
required hereby or to pay any premium in whole or part relating thereto, the
Administrative Agent may, without waiving or releasing any obligation or
liability of the Grantors hereunder or any Event of Default, in its sole
discretion, obtain and maintain such policies of insurance and pay such premium
and take any other actions with respect thereto as the Administrative Agent
deems advisable. All sums disbursed by the Administrative Agent in connection
with this paragraph, including reasonable attorneys’ fees, court costs,
expenses and other charges relating thereto, shall be payable, upon demand, by
the Grantors to the Administrative Agent and shall be additional Obligations
secured hereby.


 


(k)  Each Grantor shall maintain, in form and
manner reasonably satisfactory to the Administrative Agent, records of its
Chattel Paper and its books, records and documents evidencing or pertaining
thereto.


 


SECTION 4.04. Other
Actions. In order to further ensure the attachment,
perfection and priority of, and the ability of the Administrative Agent to
enforce, the Security Interest, each Grantor agrees, in each case at such
Grantor’s own expense, to take the following actions with respect to the
following Article 9 Collateral owned by it and subject to the Security
Interest:


 


(a) Instruments. If any Grantor shall at any time hold or
acquire any Instruments subject to the Security Interest, such Grantor shall
forthwith endorse, assign and deliver the same to the Administrative Agent,
accompanied by such instruments of transfer or assignment duly executed in
blank as the Administrative Agent may from time to time reasonably request.


 


20





















 


(b) Investment Property. Except to the extent otherwise provided
in Article III, if any Grantor shall at any time hold or acquire any certificated
securities subject to the Security Interest, such Grantor shall forthwith
endorse, assign and deliver the same to the Administrative Agent, accompanied
by such instruments of transfer or assignment duly executed in blank as the
Administrative Agent may from time to time specify. If any securities now or
hereafter acquired by any Grantor and subject to the Security Interest are
uncertificated and are issued to such Grantor or its nominee directly by the
issuer thereof, such Grantor shall immediately notify the Administrative Agent
thereof and, at the Administrative Agent’s request and option, pursuant to an
agreement in form and substance reasonably satisfactory to the Administrative
Agent, either (i) cause the issuer to agree to comply with instructions
from the Administrative Agent as to such securities, without further consent of
any Grantor or such nominee or (ii) arrange for the Administrative Agent
to become the registered owner of the securities. If any securities, whether
certificated or uncertificated, or other investment property now or hereafter
acquired by any Grantor and subject to the Security Interest are held by such
Grantor or its nominee through a securities intermediary or commodity
intermediary, such Grantor shall promptly notify the Administrative Agent
thereof and, at the Administrative Agent’s request and option, pursuant to an
agreement in form and substance reasonably satisfactory to the Administrative
Agent, either (i) cause such securities intermediary or commodity
intermediary, as the case may be, to agree to comply with entitlement orders or
other instructions from the Administrative Agent to such securities
intermediary as to such security entitlements or, as the case may be, to apply
any value distributed on account of any commodity contract as directed by the
Administrative Agent to such commodity intermediary, in each case without
further consent of any Grantor or such nominee, or (ii) in the case of
Financial Assets or other Investment Property held through a securities intermediary,
arrange for the Administrative Agent to become the entitlement holder with
respect to such investment property, with the Grantor being permitted, only
with the consent of the Administrative Agent, to exercise rights to withdraw or
otherwise deal with such investment property. The Administrative Agent agrees
with each of the Grantors that the Administrative Agent shall not give any such
entitlement orders or instructions or directions to any such issuer, securities
intermediary or commodity intermediary, and shall not withhold its consent to
the exercise of any withdrawal or dealing rights by any Grantor, unless an
Event of Default has occurred and is continuing or, after giving effect to any
such investment and withdrawal rights, would occur. The provisions of this
paragraph shall not apply to any financial assets credited to a securities
account for which the Administrative Agent is the securities intermediary.


 


(c) Electronic Chattel Paper and Transferable Records. If any
Grantor at any time holds or acquires an interest in any electronic chattel
paper or any “transferable record,” as that term is defined in Section 201
of the Federal Electronic Signatures in Global and National Commerce Act, or in
Section 16 of the Uniform Electronic Transactions Act as in effect in any
relevant jurisdiction, such Grantor shall promptly notify the Administrative
Agent thereof and, at the


 


21





















 


request of the
Administrative Agent, shall take such action as the Administrative Agent may
reasonably request to vest in the Administrative Agent control under
New York UCC Section 9-105 of such electronic chattel paper or
control under Section 201 of the Federal Electronic Signatures in Global
and National Commerce Act or, as the case may be, Section 16 of the
Uniform Electronic Transactions Act, as so in effect in such jurisdiction, of
such transferable record. The Administrative Agent agrees with such Grantor
that the Administrative Agent will arrange, pursuant to procedures reasonably
satisfactory to the Administrative Agent and so long as such procedures will
not result in the Administrative Agent’s loss of control, for the Grantor to
make alterations to the electronic chattel paper or transferable record
permitted under UCC Section 9-105 or, as the case may be, Section 201
of the Federal Electronic Signatures in Global and National Commerce Act or
Section 16 of the Uniform Electronic Transactions Act for a party in
control to allow without loss of control, unless an Event of Default has
occurred and is continuing or would occur after taking into account any action
by such Grantor with respect to such electronic chattel paper or transferable
record.


 


(d) Letter-of-Credit Rights. If any Grantor is at any time a
beneficiary under a letter of credit now or hereafter issued in favor of such
Grantor, the rights under which are subject to the Security Interest, such
Grantor shall promptly notify the Administrative Agent thereof and, at the
request and option of the Administrative Agent, such Grantor shall, pursuant to
an agreement in form and substance reasonably satisfactory to the
Administrative Agent, either (i) arrange for the issuer and any confirmer
of such letter of credit to consent to an assignment to the Administrative Agent
of the proceeds of any drawing under the letter of credit or (ii) arrange
for the Administrative Agent to become the transferee beneficiary of the letter
of credit, with the Administrative Agent agreeing, in each case, that the
proceeds of any drawing under the letter of credit are to be paid to the
applicable Grantor unless an Event of Default has occurred or is continuing.


 


(e) Commercial Tort Claims. If any US Grantor shall at any time
hold or acquire a commercial tort claim in an amount reasonably estimated to
exceed US$1,000,000, such US Grantor shall promptly notify the Administrative
Agent thereof in a writing signed by such US Grantor including a summary
description of such claim and grant to the Administrative Agent in such writing
a security interest therein and in the proceeds thereof, all upon the terms of
this Agreement, with such writing to be in form and substance reasonably
satisfactory to the Administrative Agent.


 


(f) Collateral Access Agreements. Each Grantor shall use
commercially reasonable efforts to obtain a Collateral Access Agreement from
the lessor of each leased property, mortgagee of owned property or bailee or
consignee with respect to any warehouse, processor or converter facility or
other location where Collateral is stored or located, which agreement or letter
shall provide access rights and contain a waiver or subordination of all Liens
or claims that the


 


22





















 


landlord,
mortgagee, bailee or consignee may assert against the Collateral at that
location, and shall otherwise be reasonably satisfactory in form and substance
to the Administrative Agent. If the Administrative Agent shall not have
received a Collateral Access Agreement as to any such location, the Eligible
Inventory at that location shall be subject to such Reserves as may be
established by the Administrative Agent. After the Effective Date, no real
property or warehouse space shall be leased by any Grantor and no Inventory
shall be shipped to a processor or converter under arrangements established
after the Effective Date unless and until a satisfactory Collateral Access
Agreement shall have been obtained with respect to such location, and if it has
not been obtained, the Eligible Inventory at that location shall be subject to
the establishment of Reserves acceptable to the Administrative Agent. Each
Grantor shall timely and fully pay and perform its obligations under all leases
and other agreements with respect to each leased location or third party
warehouse where any Collateral is or may be located.


 


SECTION 4.05. Covenants
Regarding Patent, Trademark and Copyright Collateral. (a)  Each US Grantor agrees that it will not take
or omit take to any action (and will exercise commercially reasonable efforts
to prevent its licensees from taking or omitting to take any action) whereby
any Patent that is material to the conduct of such Grantor’s business may
become invalidated or dedicated to the public, and agrees that it shall
continue to mark any products covered by a Patent with the relevant patent
number as necessary and sufficient to establish and preserve its maximum rights
under applicable patent laws.


 


(b)  Each US Grantor (either itself or through its
licensees or its sublicensees) will, for each Trademark material to the conduct
of such US Grantor’s business, (i) maintain such Trademark in full force
free from any claim of abandonment or invalidity for non-use,
(ii) maintain the quality of products and services offered under such
Trademark, (iii) display such Trademark with notice of Federal or foreign
registration to the extent necessary and sufficient to establish and preserve
its maximum rights under applicable law and (iv) not knowingly use or
knowingly permit the use of such Trademark in violation of any third party rights.


 


(c)  Each US Grantor (either itself or through its
licensees or sublicensees) will, for each work covered by a material Copyright,
continue to publish, reproduce, display, adopt and distribute the work with
appropriate copyright notice as necessary and sufficient to establish and
preserve its maximum rights under applicable copyright laws.


 


(d)  Each US Grantor shall notify the
Administrative Agent promptly if it knows or has reason to know that any
Patent, Trademark or Copyright material to the conduct of its business may
become abandoned, lost or dedicated to the public, or of any materially adverse
determination or development (including the institution of, or any such
determination or development in, any proceeding in the United States Patent and
Trademark Office, United States Copyright Office or any court or similar office
of any country) regarding such US Grantor’s ownership of any Patent, Trademark
or Copyright, its right to register the same, or its right to keep and maintain
the same.


 


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(e)  In no event shall any US Grantor, either
itself or through any agent, employee, licensee or designee, file an
application for any Patent, Trademark or Copyright (or for the registration of
any Trademark or Copyright) with the United States Patent and Trademark Office,
United States Copyright Office or any office or agency in any political
subdivision of the United States or in any other country or any political
subdivision thereof, unless it promptly informs the Administrative Agent, and,
upon request of the Administrative Agent, executes and delivers any and all
agreements, instruments, documents and papers as the Administrative Agent may
reasonably request to evidence the Administrative Agent’s security interest in
such Patent, Trademark or Copyright, and each US Grantor hereby appoints the
Administrative Agent as its attorney-in-fact to execute and file such writings
for the foregoing purposes, all acts of such attorney being hereby ratified and
confirmed; such power, being coupled with an interest, is irrevocable.


 


(f)  Each US Grantor will take all necessary steps
that are consistent with the practice in any proceeding before the United
States Patent and Trademark Office, United States Copyright Office or any
office or agency in any political subdivision of the United States or in any
other country or any political subdivision thereof, to maintain and pursue each
material application relating to the Patents, Trademarks or Copyrights (and to
obtain the relevant grant or registration) and to maintain each issued Patent
and each registration of the Trademarks and Copyrights that is material to the
conduct of any US Grantor’s business, including timely filings of applications
for renewal, affidavits of use, affidavits of incontestability and payment of
maintenance fees, and, if consistent with good business judgment, to initiate
opposition, interference and cancelation proceedings against third parties.


 


(g)  In the event that any US Grantor has reason
to believe that any Article 9 Collateral consisting of a Patent, Trademark
or Copyright material to the conduct of any US Grantor’s business has been or
is about to be infringed, misappropriated or diluted by a third party, such US
Grantor promptly shall notify the Administrative Agent and shall, if consistent
with good business judgment, promptly sue for infringement, misappropriation or
dilution and to recover any and all damages for such infringement,
misappropriation or dilution, and take such other actions as are appropriate
under the circumstances to protect such Article 9 Collateral.


 


(h)  Upon and during the continuance of an Event
of Default, each US Grantor shall use its best efforts to obtain all requisite
consents or approvals by the licensor of each Copyright License, Patent License
or Trademark License to effect the assignment of all such US Grantor’s right,
title and interest thereunder to the Administrative Agent or its designee.


 


SECTION
4.06. Deposit Accounts; Lockbox System; Payment Collection.


 


(a)  Deposit
Accounts. Each Grantor shall as promptly as practicable, and in any event
within the period referred to in Section 4.01(s) of the Credit Agreement,
for each Deposit Account that such Grantor at any time opens or maintains
(other than 


 


24





















 


payroll and petty cash accounts, the
aggregate amount on deposit in all of which accounts does not exceed
US$1,000,000 at any time), cause the depositary bank to execute and deliver to
the Administrative Agent a Deposit Account Control Agreement with respect to
the Deposit Account. Each Grantor acknowledges and agrees that (i) the
funds on deposit in each Deposit Account of such Grantor shall continue to be
collateral security for the Obligations secured thereby, (ii) upon the
occurrence and during the continuance of a Cash Dominion Period, at the
Administrative Agent’s election, the funds on deposit in each such Deposit
Account may be applied as provided in Section 2.11(f) of the Credit
Agreement and (iii) upon the occurrence and during the continuance of an Event
of Default, at the Administrative Agent’s election, the funds on deposit in
each such Deposit Account may be applied as provided in Section 5.02. This
paragraph shall not apply to the Deposit Accounts established as part of the
Lockbox System pursuant to paragraph (b) of this Section.


 


(b)  Lockbox System. (i)The US Grantors
have established or will, as promptly as practicable, and in any event within
the period referred to in Section 4.01(s) of the Credit Agreement,
establish, pursuant to the Lockbox Agreements for the benefit of the
Administrative Agent, on behalf of the Secured Parties, a system of lockboxes
and related Deposit Accounts (the “Lockbox System”) into which
the Proceeds of all Accounts and Inventory shall be deposited.


 


(ii) Before establishing any new lockbox or lockbox arrangement, each
US Grantor shall cause each bank or financial institution with which it seeks
to establish such a lockbox or lockbox arrangement to enter into a Lockbox Agreement
with respect thereto. In the case of any Lockbox Agreement with any such bank
or financial institution that is a Lender, such Lockbox Agreement shall be
subject to the provisions of the Credit Agreement regarding setoffs.


 


(iii) Without the prior written consent of the Administrative Agent, no
US Grantor shall, in a manner adverse to the Lenders, change the general
instructions given to Account Debtors in respect of payments on account of
Accounts or Inventory to be deposited in the Lockbox System.


 


(iv) Each US Grantor acknowledges and agrees that (i) the funds on
deposit in the Lockbox System shall continue to be collateral security for the
Obligations secured thereby, (ii) upon the occurrence and during the
continuance of a Cash Dominion Period, at the Administrative Agent’s election,
the funds on deposit in the Lockbox System may be applied as provided in
Section 2.11(f) of the Credit Agreement and (iii) upon the occurrence and
during the continuance of an Event of Default, at the Administrative Agent’s
election, the funds on deposit in the Lockbox System may be applied as provided
in Section 5.02.


 


(c)  Payment Collection. (i) Each US
Grantor has directed, and will at all times hereafter direct, all of its
Account Debtors to forward all payments on account of Accounts and Inventory
directly to the Lockbox System. Each US Grantor agrees (ii) to use all
reasonable efforts to cause each Account Debtor and every other Person
identified in clause (i) above to make all payments with respect to
Accounts and Inventory directly


 


25





















 


to the Lockbox System and (ii) promptly
to deposit all payments received by it on account of Accounts and Inventory,
whether in the form of cash, checks, notes, drafts, bills of exchange, money
orders or otherwise, in the Lockbox System in precisely the form in which they
are received (but with any endorsements of such US Grantor necessary for
deposit or collection), and until they are so deposited to hold such payments
in trust for and as the property of the Administrative Agent.


 


(ii) Each Non-US Grantor agrees promptly to deposit all payments
received by it on account of Accounts and Inventory, whether in the form of
cash, checks, notes, drafts, bills of exchange, money orders or otherwise, in
precisely the form in which they are received (but with any endorsements of
such Non-US Grantor necessary for deposit or collection), into a Deposit
Account with respect to which the depositary bank shall have entered into a
Deposit Account Control Agreement with the Administrative Agent, and until they
are so deposited to hold such payments in trust for and as the property of the
Administrative Agent.


 


ARTICLE V


 


Remedies


 


SECTION 5.01. Remedies
Upon Default. Upon the occurrence and during the continuance
of an Event of Default, each Grantor agrees to deliver each item of Collateral
to the Administrative Agent on demand, and it is agreed that the Administrative
Agent shall have the right to take any of or all the following actions at the
same or different times:  (a) with
respect to any Article 9 Collateral consisting of Intellectual Property,
on demand, to cause the Security Interest to become an assignment, transfer and
conveyance of any of or all such Article 9 Collateral by the applicable Grantors
to the Administrative Agent, or to license or sublicense, whether general,
special or otherwise, and whether on an exclusive or nonexclusive basis, any
such Article 9 Collateral throughout the world on such terms and conditions and
in such manner as the Administrative Agent shall determine (other than in
violation of any then-existing licensing arrangements to the extent that
waivers cannot be obtained), and (b) with or without legal process and
with or without prior notice or demand for performance, to take possession of
the Article 9 Collateral and without liability for trespass to enter any
premises where the Article 9 Collateral may be located for the purpose of
taking possession of or removing the Article 9 Collateral and, generally, to
exercise any and all rights afforded to a secured party under the Uniform
Commercial Code or other applicable law. Without limiting the generality of the
foregoing, each Grantor agrees that the Administrative Agent shall have the
right, subject to the mandatory requirements of applicable law, to sell or
otherwise dispose of all or any part of the Collateral at a public or private
sale or at any broker’s board or on any securities exchange, for cash, upon
credit or for future delivery as the Administrative Agent shall deem
appropriate. The Administrative Agent shall be authorized at any such sale of
securities (if it deems it advisable to do so) to restrict the prospective
bidders or purchasers to Persons who will represent and agree that they are
purchasing the Collateral for their own account for investment and not with a
view to the distribution or sale thereof, and upon consummation of any such
sale the Administrative Agent shall have the right to assign,


 


26





















 


transfer and deliver to the purchaser or
purchasers thereof the Collateral so sold. Each such purchaser at any sale of
Collateral shall hold the property sold absolutely, free from any claim or
right on the part of any Grantor, and each Grantor hereby waives (to the extent
permitted by law) all rights of redemption, stay and appraisal which such
Grantor now has or may at any time in the future have under any rule of law or
statute now existing or hereafter enacted.


 


The
Administrative Agent shall give the applicable Grantors 10 days’ written
notice (which each Grantor agrees is reasonable notice within the meaning of
Section 9-611 of the New York UCC or its equivalent in other
jurisdictions) of the Administrative Agent’s intention to make any sale of
Collateral. Such notice, in the case of a public sale, shall state the time and
place for such sale and, in the case of a sale at a broker’s board or on a
securities exchange, shall state the board or exchange at which such sale is to
be made and the day on which the Collateral, or portion thereof, will first be
offered for sale at such board or exchange. Any such public sale shall be held
at such time or times within ordinary business hours and at such place or
places as the Administrative Agent may fix and state in the notice (if any) of
such sale. At any such sale, the Collateral, or portion thereof, to be sold may
be sold in one lot as an entirety or in separate parcels, as the Administrative
Agent may (in its sole and absolute discretion) determine. The Administrative Agent
shall not be obligated to make any sale of any Collateral if it shall determine
not to do so, regardless of the fact that notice of sale of such Collateral
shall have been given. The Administrative Agent may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for
sale, and such sale may, without further notice, be made at the time and place
to which the same was so adjourned. In case any sale of all or any part of the
Collateral is made on credit or for future delivery, the Collateral so sold may
be retained by the Administrative Agent until the sale price is paid by the
purchaser or purchasers thereof, but the Administrative Agent shall not incur
any liability in case any such purchaser or purchasers shall fail to take up
and pay for the Collateral so sold and, in case of any such failure, such
Collateral may be sold again upon like notice. At any public (or, to the extent
permitted by law, private) sale made pursuant to this Agreement, any Secured
Party may bid for or purchase, free (to the extent permitted by law) from any
right of redemption, stay, valuation or appraisal on the part of any Grantor
(all said rights being also hereby waived and released to the extent permitted
by law), the Collateral or any part thereof offered for sale and may make
payment on account thereof by using any claim then due and payable to such
Secured Party from any Grantor as a credit against the purchase price, and such
Secured Party may, upon compliance with the terms of sale, hold, retain and
dispose of such property without further accountability to any Grantor therefor.
For purposes hereof, a written agreement to purchase the Collateral or any
portion thereof shall be treated as a sale thereof; the Administrative Agent
shall be free to carry out such sale pursuant to such agreement and no Grantor
shall be entitled to the return of the Collateral or any portion thereof
subject thereto, notwithstanding the fact that after the Administrative Agent
shall have entered into such an agreement all Events of Default shall have been
remedied and the Obligations paid in full. As an alternative to exercising the
power of sale herein conferred upon it, the Administrative Agent may proceed by
a suit or suits at law or in equity to foreclose this Agreement and to sell the
Collateral or any portion thereof 


 


27

















 


pursuant to a
judgment or decree of a court or courts having competent jurisdiction or
pursuant to a proceeding by a court-appointed receiver. Any sale pursuant to
the provisions of this Section shall be deemed to conform to the commercially
reasonable standards as provided in Section 9-610(b) of the New York
UCC or its equivalent in other jurisdictions.


 


SECTION 5.02. Application
of Proceeds. Subject to applicable law, the
Administrative Agent shall apply the proceeds of any collection or sale of any
Collateral, and any Collateral consisting of cash, as follows:


 


FIRST, to the payment of all costs and
expenses incurred by the Administrative Agent in connection with such
collection or sale or otherwise in connection with this Agreement, any other
Loan Document or any of the Obligations, including all court costs and the fees
and expenses of its agents and legal counsel, the repayment of all advances
(other than Protective Advances) made by the Administrative Agent hereunder or
under any other Loan Document on behalf of any Grantor and any other costs or
expenses incurred in connection with the exercise of any right or remedy
hereunder or under any other Loan Document;


 


SECOND, to the payment in full of the
Protective Advances secured by such Collateral and interest accrued thereon;


 


THIRD, to the payment in full of the other
Obligations (other than the obligations referred to in clause FOURTH below)
secured by such Collateral (the amounts so applied to be distributed among the
applicable Secured Parties pro rata in accordance with the amounts of such
Obligations owed to them on the date of any such distribution);


 


FOURTH, to the payment in full of the
Obligations of the type referred to in clause (c) of the definition of
such term (the amounts so applied to be distributed among the applicable
Secured Parties pro rata in accordance with the amounts of such Obligations
owed to them on the date of any such distribution); and


 


FIFTH, to the Grantors, their successors or
assigns, or as a court of competent jurisdiction may otherwise direct.


 


The
Administrative Agent shall have absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Agreement. Upon any sale of Collateral by the Administrative Agent (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the Administrative Agent or of the officer making the sale shall
be a sufficient discharge to the purchaser or purchasers of the Collateral so
sold and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Administrative
Agent or such officer or be answerable in any way for the misapplication
thereof.


 


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SECTION 5.03. Grant
of License to Use Intellectual Property. For the
purpose of enabling the Administrative Agent to exercise rights and remedies
under this Agreement 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 an irrevocable, nonexclusive license (exercisable
without payment of royalty or other compensation to the Grantors) to use,
license or sublicense any of the Article 9 Collateral consisting of
Intellectual Property now owned or hereafter acquired by such Grantor, and
wherever the same may be located, and including in such license reasonable
access to all media in which any of the licensed items may be recorded or
stored and to all computer software and programs used for the compilation or
printout thereof. The rights conferred by such license may be exercised, at the
option of the Administrative Agent, upon the occurrence and during the
continuation of an Event of Default; provided that any license,
sublicense or other transaction entered into by the Administrative Agent in
accordance herewith shall be binding upon the Grantors notwithstanding any
subsequent cure of an Event of Default.


 


SECTION 5.04. Securities
Act. In view of the position of the US Grantors in relation
to the Pledged Collateral, or because of other current or future circumstances,
a question may arise under the Securities Act of 1933, as now or hereafter in
effect, or any similar statute hereafter enacted analogous in purpose or effect
(such Act and any such similar statute as from time to time in effect being
called the “Federal Securities Laws”) with respect to any
disposition of the Pledged Collateral permitted hereunder. Each US Grantor
understands that compliance with the Federal Securities Laws might very
strictly limit the course of conduct of the Administrative Agent if the
Administrative Agent were to attempt to dispose of all or any part of the
Pledged Collateral, and might also limit the extent to which or the manner in
which any subsequent transferee of any Pledged Collateral could dispose of the
same. Similarly, there may be other legal restrictions or limitations affecting
the Administrative Agent in any attempt to dispose of all or part of the
Pledged Collateral under applicable Blue Sky or other state securities laws or
similar laws analogous in purpose or effect. Each US Grantor recognizes that in
light of such restrictions and limitations the Administrative Agent may, with
respect to any sale of the Pledged Collateral, limit the purchasers to those
who will agree, among other things, to acquire such Pledged Collateral for
their own account, for investment, and not with a view to the distribution or
resale thereof. Each US Grantor acknowledges and agrees that in light of such
restrictions and limitations, the Administrative Agent, in its sole and
absolute discretion (a) may proceed to make such a sale whether or not a
registration statement for the purpose of registering such Pledged Collateral
or part thereof shall have been filed under the Federal Securities Laws and
(b) may approach and negotiate with a single potential purchaser to effect
such sale. Each US Grantor acknowledges and agrees that any such sale might
result in prices and other terms less favorable to the seller than if such sale
were a public sale without such restrictions. In the event of any such sale,
the Administrative Agent shall incur no responsibility or liability for selling
all or any part of the Pledged Collateral at a price that the Administrative
Agent, in its sole and absolute discretion, may in good faith deem reasonable
under the circumstances, notwithstanding the possibility that a substantially
higher price might have been realized if the sale were deferred until after
registration as aforesaid or if more than a single purchaser were approached. The
provisions of this


 


29





















 


Section will apply notwithstanding the
existence of a public or private market upon which the quotations or sales
prices may exceed substantially the price at which the Administrative Agent
sells.


 


SECTION 5.05. Registration.  Each US Grantor agrees
that, upon the occurrence and during the continuance of an Event of Default, if
for any reason the Administrative Agent desires to sell any of the Pledged
Collateral at a public sale, it will, at any time and from time to time, upon
the written request of the Administrative Agent, use its best efforts to take
or to cause the issuer of such Pledged Collateral to take such action and
prepare, distribute and/or file such documents, as are required or advisable in
the reasonable opinion of counsel for the Administrative Agent to permit the
public sale of such Pledged Collateral. Each Grantor further agrees to
indemnify, defend and hold harmless the Administrative Agent, each other Secured
Party, any underwriter and their respective officers, directors, affiliates and
controlling persons from and against all loss, liability, expenses, costs of
counsel (including, without limitation, reasonable fees and expenses to the
Administrative Agent of legal counsel), and claims (including the costs of
investigation) that they may incur insofar as such loss, liability, expense or
claim arises out of or is based upon any alleged untrue statement of a material
fact contained in any prospectus (or any amendment or supplement thereto) or in
any notification or offering circular, or arises out of or is based upon any
alleged omission to state a material fact required to be stated therein or
necessary to make the statements in any thereof not misleading, except insofar
as the same may have been caused by any untrue statement or omission based upon
information furnished in writing to such Grantor or the issuer of such Pledged
Collateral by the Administrative Agent or any other Secured Party expressly for
use therein. Each US Grantor further agrees, upon such written request referred
to above, to use its best efforts to qualify, file or register, or cause the
issuer of such Pledged Collateral to qualify, file or register, any of the
Pledged Collateral under the Blue Sky or other securities laws of such states
as may be requested by the Administrative Agent and keep effective, or cause to
be kept effective, all such qualifications, filings or registrations. Each US
Grantor will bear all costs and expenses of carrying out its obligations under
this Section. Each Grantor acknowledges that there is no adequate remedy at law
for failure by it to comply with the provisions of this Section and that such
failure would not be adequately compensable in damages, and therefore agrees
that its agreements contained in this Section may be specifically enforced.


 


SECTION 5.06. Concerning
Pledged Securities. Notwithstanding anything to the contrary set forth in
this Agreement or the Credit Agreement, at any time when any Senior Notes shall
be outstanding, if (a) pursuant to Section 4.06 of the Collateral Agreement (as
defined in the Senior Notes Indenture), as in effect on the date hereof, the
Senior Notes Collateral Agent shall be restricted from realizing upon any
portion of the Equity Interests in, or other securities issued by, any
Subsidiary constituting collateral securing obligations under the Senior Notes
Documents or (b) pursuant to clause (11) of Section 9.01 of the Indenture, as
in effect on the date hereof, the Liens of the Senior Notes Collateral Agent on
any Equity Interests in, or other securities issued by, any Subsidiary shall
have been released, in each case solely to the extent necessary for the
separate financial statements of such Subsidiary not to be


 


30





















 


required under the rules and regulations of
the Securities and Exchange Commission, then (i) the Administrative Agent shall
be restricted from realizing upon such portion of such Equity Interests or
other securities to the same extent as such restriction applies to the Senior
Notes Collateral Agent or (ii) the Liens created hereunder on such Equity
Interests or other securities (but not on any Equity Interests or other
securities that shall not be released from the Liens of the Senior Notes
Collateral Agent) shall automatically be released concurrently with the release
of the corresponding Liens of the Senior Notes Collateral Agent (it being
understood and agreed that such Liens created hereunder shall automatically be
reinstated (and such Equity Interest and other securities shall automatically
become part of the Pledged Collateral) (A) to the extent such corresponding
Liens of the Senior Notes Collateral Agent are reinstated and (B) at the time
when no Senior Notes shall be outstanding).


 


ARTICLE VI


 


Indemnity,
Subrogation and Subordination


 


SECTION 6.01. Indemnity
and Subrogation. In addition to all such rights of
indemnity and subrogation as the Guarantors may have under applicable law (but
subject to Section 6.03), Symmetry and the Borrowers agree that
(a) in the event a payment of an obligation of either Borrower shall be
made by any Guarantor under this Agreement, Symmetry and such Borrower (and, in
the case of an obligation of the Canadian Borrower, the US Borrower) shall
indemnify such Guarantor for the full amount of such payment and such Guarantor
shall be subrogated to the rights of the Person to whom such payment shall have
been made to the extent of such payment and (b) in the event any assets of
any Grantor shall be sold pursuant to this Agreement or any other Security
Document to satisfy in whole or in part an obligation of either Borrower owed
to any Secured Party, Symmetry and such Borrower (and, in the case of an
obligation of the Canadian Borrower, the US Borrower) shall indemnify such
Grantor in an amount equal to the greater of the book value or the fair market
value of the assets so sold.


 


SECTION 6.02. Contribution
and Subrogation. Each Subsidiary Party (a “Contributing
Party”) agrees (subject to Section 6.03) that, in the
event a payment shall be made by any other Subsidiary Party hereunder in
respect of any Obligation guaranteed by the Contributing Party or assets of any
other Subsidiary Party shall be sold pursuant to any Security Document to satisfy
any Obligation guaranteed by the Contributing Party and such other Subsidiary
Party (the “Claiming Party”) shall not have been fully
indemnified as provided in Section 6.01, the Contributing Party shall
indemnify the Claiming Party in an amount equal to the amount of such payment
or the greater of the book value or the fair market value of such assets, as
the case may be, in each case multiplied by a fraction of which the numerator
shall be the net worth of the Contributing Party on the date hereof and the
denominator shall be the aggregate net worth of all the Subsidiary Parties that
have guaranteed the applicable Obligation on the date hereof (or, in the case
of any Subsidiary Party becoming a party hereto pursuant to Section 7.14,
the date of the supplement hereto executed and delivered by such Subsidiary
Party). Any Contributing Party making any payment to a Claiming Party pursuant
to this Section shall


 


31





















 


be subrogated to the rights of such Claiming Party
under Section 6.01 to the extent of such payment.


 


SECTION 6.03. Subordination.
(a)  Notwithstanding any provision of
this Agreement to the contrary, all rights of the Subsidiary Parties under
Sections 6.01 and 6.02 and all other rights of indemnity, contribution or
subrogation under applicable law or otherwise shall be fully subordinated to
the indefeasible payment in full in cash of the Obligations. No failure on the
part of Symmetry, either Borrower or any Subsidiary Party to make the payments
required by Sections 6.01 and 6.02 (or any other payments required under
applicable law or otherwise) shall in any respect limit the obligations and
liabilities of Symmetry, either Borrower or any Subsidiary Party with respect
to its obligations hereunder, and each such Person shall remain liable for the
full amount of its obligations hereunder.


 


ARTICLE VII


 


Miscellaneous


 


SECTION 7.01. Notices.
All communications and notices hereunder shall (except as otherwise expressly
permitted herein) be in writing and given as provided in Section 9.01 of
the Credit Agreement. All communications and notices hereunder to any
Subsidiary Party shall be given to it in care of Symmetry as provided in
Section 9.01 of the Credit Agreement.


 


SECTION 7.02. Waivers;
Amendment. (a)  No
failure or delay by the Administrative Agent, any Issuing Bank or any Lender in
exercising any right or power hereunder or under any other Loan Document shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce
such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of the
Administrative Agent, the Issuing Banks and the Lenders hereunder and under the
other Loan Documents are cumulative and are not exclusive of any rights or
remedies that they would otherwise have. No waiver of any provision of this
Agreement or consent to any departure by any Loan Party therefrom shall in any
event be effective unless the same shall be permitted by paragraph (b) of
this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Loan, acceptance of a BA or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent, any Lender or any
Issuing Bank may have had notice or knowledge of such Default at the time. No
notice or demand on any Loan Party in any case shall entitle any Loan Party to
any other or further notice or demand in similar or other circumstances.


 


(b)  Neither this Agreement nor any provision
hereof may be waived, amended or modified except pursuant to an agreement or
agreements in writing entered into by the Administrative Agent and the Loan
Party or Loan Parties with respect to


 


32





















 


which such waiver, amendment or modification
is to apply, subject to any consent required in accordance with
Section 9.02 of the Credit Agreement.


 


SECTION 7.03. Administrative
Agent’s Fees and Expenses; Indemnification. (a)  The parties hereto agree that the
Administrative Agent shall be entitled to reimbursement of its expenses
incurred hereunder as provided in Section 9.03 of the Credit Agreement.


 


(b)  Without limitation of its indemnification
obligations under the other Loan Documents, the US Grantors, jointly and
severally as to themselves, and the Non-US Grantors, jointly and severally as
to themselves, agree to indemnify the Administrative Agent and the other
Indemnitees (as defined in Section 9.03 of the Credit Agreement) against,
and hold each Indemnitee harmless from, any and all losses, claims, damages,
liabilities and related expenses, including the fees, charges and disbursements
of any counsel for any Indemnitee, incurred by or asserted against any
Indemnitee arising out of, in connection with, or as a result of, the
execution, delivery or performance of this Agreement or any claim, litigation,
investigation or proceeding relating to any of the foregoing, or any agreement
or instrument contemplated hereby, or to the Collateral, whether or not any
Indemnitee is a party thereto; provided that such indemnity shall not,
as to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or wilful misconduct of such Indemnitee or any of its Related
Parties.


 


(c)  Any such amounts payable as provided
hereunder shall be additional Obligations secured hereby and by the other
Security Documents. The provisions of this Section shall remain operative and
in full force and effect regardless of the termination of this Agreement or any
other Loan Document, the consummation of the transactions contemplated hereby,
the repayment of any of the Obligations, the invalidity or unenforceability of
any term or provision of this Agreement or any other Loan Document, or any
investigation made by or on behalf of the Administrative Agent or any other
Secured Party. All amounts due under this Section shall be payable on written
demand therefor.


 


SECTION 7.04. Successors
and Assigns. Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
permitted successors and assigns of such party; and all covenants, promises and
agreements by or on behalf of any Guarantor or Grantor or the Administrative
Agent that are contained in this Agreement shall bind and inure to the benefit
of their respective successors and assigns.


 


SECTION 7.05. Survival
of Agreement. All covenants, agreements,
representations and warranties made by the Loan Parties in the Loan Documents
and in the certificates or other instruments prepared or delivered in
connection with or pursuant to this Agreement or any other Loan Document shall
be considered to have been relied upon by the Lenders and shall survive the
execution and delivery of the Loan Documents and the making of any Loans, the
acceptance of any BAs and the issuance of any Letters


 


33





















 


of Credit, regardless of any investigation
made by any Lender or on its behalf and notwithstanding that the Administrative
Agent, any Issuing Bank or any Lender may have had notice or knowledge of any
Default or incorrect representation or warranty at the time any credit is
extended under the Credit Agreement, and shall continue in full force and
effect as long as the principal of or any accrued interest on any Loan or any
fee or any other amount payable under any Loan Document is outstanding and
unpaid or any Letter of Credit is outstanding and so long as the Commitments
have not expired or terminated.


 


SECTION 7.06. Counterparts;
Effectiveness; Several Agreement. This Agreement may
be executed in counterparts, each of which shall constitute an original but all
of which when taken together shall constitute a single contract. Delivery of an
executed signature page to this Agreement by facsimile or electronic
transmission shall be as effective as delivery of a manually signed counterpart
of this Agreement. This Agreement shall become effective as to any Loan Party
when a counterpart hereof executed on behalf of such Loan Party shall have been
delivered to the Administrative Agent and a counterpart hereof shall have been
executed on behalf of the Administrative Agent, and thereafter shall be binding
upon such Loan Party and the Administrative Agent and their respective
permitted successors and assigns, and shall inure to the benefit of such Loan
Party, the Administrative Agent and the other Secured Parties and their
respective successors and assigns, except that no Loan Party shall have the
right to assign or transfer its rights or obligations hereunder or any interest
herein or in the Collateral (and any such assignment or transfer shall be void)
except as expressly provided in this Agreement or the Credit Agreement. This
Agreement shall be construed as a separate agreement with respect to each Loan
Party and may be amended, modified, supplemented, waived or released with
respect to any Loan Party without the approval of any other Loan Party and
without affecting the obligations of any other Loan Party hereunder.


 


SECTION 7.07. Severability.
Any provision of this Agreement held to be invalid, illegal or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such invalidity, illegality or unenforceability without affecting the
validity, legality and enforceability of the remaining provisions hereof; and
the invalidity of a particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction. The parties shall endeavor
in good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable provisions.


 


SECTION 7.08. Right
of Set-Off. If an Event of Default shall have occurred
and be continuing, each Lender and each of its Affiliates is hereby authorized
at any time and from time to time, to the fullest extent permitted by law, to
set off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other obligations at any time owing
by such Lender or Affiliate to or for the credit or the account of any
Guarantor or Grantor against any of and all the obligations of such Guarantor
or Grantor then due now or hereafter existing under this Agreement owed to such
Lender, irrespective of whether or not such Lender shall have made any demand


 


34





















 


under this Agreement. The rights of each
Lender under this Section are in addition to other rights and remedies
(including other rights of set-off) which such Lender may have.


 


SECTION 7.09. Governing
Law; Jurisdiction; Consent to Service of Process. (a)  This Agreement shall be construed in
accordance with and governed by the law of the State of New York.


 


(b)  Each of the Loan Parties hereby irrevocably
and unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement or any other Loan Document, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State
or, to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by law. Nothing in this Agreement or any other
Loan Document shall affect any right that the Administrative Agent, any Issuing
Bank or any Lender may otherwise have to bring any action or proceeding
relating to this Agreement or any other Loan Document against any Grantor or
Guarantor, or its properties in the courts of any jurisdiction.


 


(c)  Each of the Loan Parties hereby irrevocably
and unconditionally waives, to the fullest extent it may legally and
effectively do so, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Agreement or any other Loan Document in any court referred to in
paragraph (b) of this Section. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.


 


(d)  Each party to this Agreement irrevocably
consents to service of process in the manner provided for notices in
Section 7.01. Nothing in this Agreement or any other Loan Document will
affect the right of any party to this Agreement to serve process in any other
manner permitted by law.


 


SECTION 7.10. WAIVER
OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN
THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT


 


35





















 


AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION.


 


SECTION 7.11. Headings.
Article and Section headings and the Table of Contents used herein are for
convenience of reference only, are not part of this Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Agreement.


 


SECTION 7.12. Security
Interest Absolute. All rights of the Administrative
Agent hereunder, the Security Interest, the grant of a security interest in the
Pledged Collateral and all obligations of each Grantor and Guarantor hereunder
shall be absolute and unconditional irrespective of (a) any lack of
validity or enforceability of the Credit Agreement, any other Loan Document,
any agreement with respect to any of the Obligations or any other agreement or
instrument relating to any of the foregoing, (b) any change in the time,
manner or place of payment of, or in any other term of, all or any of the
Obligations, or any other amendment or waiver of or any consent to any
departure from the Credit Agreement, any other Loan Document or any other
agreement or instrument, (c) any exchange, release or non-perfection of
any Lien on other collateral, or any release or amendment or waiver of or
consent under or departure from any guarantee, securing or guaranteeing all or
any of the Obligations, or (d) any other circumstance that might otherwise
constitute a defense available to, or a discharge of, any Grantor or Guarantor
in respect of the Obligations or this Agreement.


 


SECTION 7.13. Termination
or Release. (a) 
This Agreement, the Guarantees made herein, the Security Interest and
all other security interests granted hereby shall terminate when all the Loan
Documents Obligations (other than contingent obligations) have been
indefeasibly paid in full and the Lenders have no further commitment to lend
under the Credit Agreement, the LC Exposure has been reduced to zero and the
Issuing Banks have no further obligations to issue Letters of Credit under the
Credit Agreement.


 


(b)  Except as provided in paragraph (a) of
this Section, releases of any Subsidiary Parties from their obligations
hereunder, and releases of Collateral from the Liens created hereby, shall be
governed by Section 9.14 of the Credit Agreement.


 


SECTION 7.14. Additional
Subsidiaries. Pursuant to Section 5.12 of the
Credit Agreement, each Subsidiary Party that was not in existence or not a
Subsidiary Party on the date of the Credit Agreement is required to become a
party to this Agreement as a Guarantor and Grantor and, if such Subsidiary
Party is a US Subsidiary, to the Intercreditor Agreement as a “Grantor”, upon
becoming such a Subsidiary Party. Upon the execution and delivery by the
Administrative Agent and a Subsidiary Party of an instrument in the form of
Exhibit I hereto, such Subsidiary Party shall become a Guarantor and a
Grantor hereunder with the same force and effect as if originally named as such
herein. The execution and delivery of any such instrument shall not require the
consent of any other Loan Party hereunder. The rights and obligations of each
Loan


 


36





















 


Party hereunder shall remain in full force
and effect notwithstanding the addition of any new Loan Party as a party to
this Agreement.


 


SECTION 7.15. Administrative
Agent Appointed Attorney-in-Fact. Each Grantor hereby
appoints the Administrative Agent the attorney-in-fact of such Grantor for the
purpose of carrying out the provisions of this Agreement and taking any action
and executing any instrument that the Administrative Agent may deem necessary
or advisable to accomplish the purposes hereof, which appointment is
irrevocable and coupled with an interest. Without limiting the generality of
the foregoing, the Administrative Agent shall have the right, upon the
occurrence and during the continuance of an Event of Default, with full power
of substitution either in the Administrative Agent’s name or in the name of
such Grantor (a) to receive, endorse, assign or deliver any and all notes,
acceptances, checks, drafts, money orders or other evidences of payment relating
to the Collateral or any part thereof; (b) to demand, collect, receive
payment of, give receipt for and give discharges and releases of all or any of
the Collateral; (c) to sign the name of any Grantor on any invoice or bill
of lading relating to any of the Collateral; (d) to send verifications of
Accounts Receivable to any Account Debtor; (e) to commence and prosecute
any and all suits, actions or proceedings at law or in equity in any court of
competent jurisdiction to collect or otherwise realize on all or any of the
Collateral or to enforce any rights in respect of any Collateral; (f) to
settle, compromise, compound, adjust or defend any actions, suits or
proceedings relating to all or any of the Collateral; (g) to notify, or to
require any Grantor to notify, Account Debtors to make payment directly to the
Administrative Agent; and (h) to use, sell, assign, transfer, pledge, make
any agreement with respect to or otherwise deal with all or any of the
Collateral, and to do all other acts and things necessary to carry out the
purposes of this Agreement, as fully and completely as though the
Administrative Agent were the absolute owner of the Collateral for all
purposes; provided that nothing herein contained shall be
construed as requiring or obligating the Administrative Agent to make any
commitment or to make any inquiry as to the nature or sufficiency of any
payment received by the Administrative Agent, or to present or file any claim
or notice, or to take any action with respect to the Collateral or any part
thereof or the moneys due or to become due in respect thereof or any property
covered thereby. The Administrative Agent and the other Secured Parties shall
be accountable only for amounts actually received as a result of the exercise
of the powers granted to them herein, and neither they nor 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 wilful
misconduct.


 


SECTION 7.16. Intercreditor
Agreement; Possession and Control of Non-ABL Collateral.
Notwithstanding anything herein to the contrary, the Liens granted to the
Administrative Agent under this Agreement and the exercise of the rights and
remedies of the Administrative Agent hereunder are subject to the provisions of
the Intercreditor Agreement. In the event of any conflict between the terms of
the Intercreditor Agreement and this Agreement, the terms of the Intercreditor
Agreement shall govern and control. At any time prior to the Discharge of
Senior Notes Obligations (as defined in the Intercreditor Agreement), no
Grantor shall be required to take or refrain from taking any action at the
request of the Administrative Agent with respect to any


 


37





















 


Non-ABL Collateral if such action or inaction
would be inconsistent with (i) any action or inaction affirmatively
requested by the Senior Notes Collateral Agent in accordance with the Senior
Notes Documents or (ii) any action or inaction affirmatively required by
any of the provisions of the Senior Notes Documents. Without limiting the
foregoing, at any time prior to the Discharge of Senior Notes Obligations (as
defined in the Intercreditor Agreement), any provision hereof requiring
Grantors to deliver possession of any Non-ABL Collateral to the Administrative
Agent or its representatives, or to cause the Administrative Agent or its
representatives to control any Non-ABL Collateral, shall be deemed to have been
complied with if and for so long as the Non-ABL Collateral Senior Agent shall
have such possession or control for the benefit of the holders of the Senior
Notes and as bailee or sub-agent of the Administrative Agent as provided in the
Intercreditor Agreement.


 


38

















 


IN WITNESS
WHEREOF, the parties hereto have duly executed this Agreement as of the day and
year first above written.


 


	
   

  	
  SYMMETRY HOLDINGS INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
   

  	
  /s/ Corrado De Gasperis

  
	
   

  	
   

  	
   

  	
  Name: Corrado De Gasperis

  
	
   

  	
   

  	
   

  	
  Title:   Chief Executive
  Officer

  



 


 


	
   

  	
  NOVAMERICAN STEEL FINCO INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
   

  	
  /s/ Corrado De Gasperis

  
	
   

  	
   

  	
   

  	
  Name: Corrado De Gasperis

  
	
   

  	
   

  	
   

  	
  Title:   President and
  Treasurer

  



 


 


	
   

  	
  NOVAMERICAN STEEL INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
   

  	
  /s/ Corrado De Gasperis

  
	
   

  	
   

  	
   

  	
  Name: Corrado De Gasperis

  
	
   

  	
   

  	
   

  	
  Title:   President

  



 


 


	
   

  	
  EACH OF THE OTHER SUBSIDIARIES 

  OF SYMMETRY

  LISTED ON SCHEDULE I HERETO,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
   

  	
  /s/ Corrado De Gasperis

  
	
   

  	
   

  	
   

  	
  Name: Corrado De Gasperis

  
	
   

  	
   

  	
   

  	
  Title:   President and
  Treasurer

  



 


 


	
   

  	
  JPMORGAN CHASE BANK, N.A., AS

  ADMINISTRATIVE AGENT,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
   

  	
  /s/ Neil R. Boylan

  
	
   

  	
   

  	
   

  	
  Name: Neil R. Boylan

  
	
   

  	
   

  	
   

  	
  Title: Managing Director

  



 


 


[GUARANTEE AND COLLATERAL AGREEMENT]


 
















 


Schedule I to


the Guarantee and


Collateral Agreement


 


 


SUBSIDIARY PARTIES


1.             Novamerican Steel Holdings Inc.


2.             Integrated Steel Industries, Inc.


3.             American Steel and Aluminum Corporation


4.             Nova Tube and Steel, Inc.


5.             Novamerican Tube Holdings, Inc.


6.             Nova Tube Indiana, LLC


7.             632422 N.B. Ltd.


 


 


Schedule II to the Guarantee
and Collateral Agreement


 


PLEDGED EQUITY INTERESTS


Registered Owner / Pledgor


(Jurisdiction of Organization)       Issuer


(Jurisdiction of Organization)


Certificate


Number (Date)  Number
and


Class of


Equity Interest   Percentage


Equity Interests Pledged


Symmetry Holdings Inc.
(Delaware)       Novamerican Steel Holdings
Inc. (Delaware)       1 (as of June 20,


2007)    1
share of Common Stock          100%


Novamerican Steel Holdings Inc.
(Delaware)       Novamerican Steel Finco
Inc. (Delaware)       1 (as of


June 20, 2007)    1
share of Common Stock          100%


Novamerican Steel Finco Inc.
(Delaware)             Novamerican
Steel Inc. (Canada)           C-1
(November 15,


2007)    661
shares of Common Stock     66%


Novamerican Steel Finco Inc.
(Delaware)             Integrated
Steel Industries, Inc. (Delaware)     3


(November 15, 2007)     1,000
shares of Common Stock   100%


Integrated Steel Industries,
Inc. (Delaware)           American
Steel and Aluminum Corporation


(Massachusetts)4  (dated
2001)  4,276 shares of


Common Stock   100%


Integrated Steel Industries,
Inc. (Delaware)           Nova
Tube and Steel, Inc. (Delaware) (formerly was


Novatlantic Steel and Tube)       2
(dated January 23, 2001)           100
shares of Common Stock      100%


Integrated Steel Industries,
Inc. (Delaware)           Novamerican
Tube Holdings, Inc. (Delaware)      1 (dated


January 21, 2001)           1,000 shares of Common
Stock   100%


Novamerican Tube Holdings, Inc.
(Delaware)       Nova Tube Indiana, LLC
(Delaware)       N/A     100
LLC


Membership Interests (will be
certificated post closing)    100%


 


PLEDGED DEBT SECURITIES


Pledgor


(Jurisdiction of Organization)       Issuer


(Jurisdiction of Organization)


Principal Amount          Date
of Note        Maturity Date


 

















 


Novamerican Steel Finco Inc.
(Delaware)           Novamerican
Steel Inc. (Canada)           US$7,800,000


November 15,
2007        On Demand


Novamerican Steel Finco Inc.
(Delaware)           Novamerican
Steel Inc. (Canada)           US$117,200,000


November 15,
2007        On Demand


Symmetry Holdings Inc.
(Delaware); Novamerican Steel Holdings Inc. (Delaware); Novamerican Steel


Finco Inc. (Delaware);
Integrated Steel Industries, Inc. (Delaware); American Steel and Aluminum


Corporation (Massachusetts);
Novamerican Tube Holdings, Inc. (Delaware); Nova Tube and Steel, Inc.


(Delaware); and Nova Tube
Indiana, LLC (Delaware)     Symmetry Holdings Inc.
(Delaware); Novamerican


Steel Holdings Inc. (Delaware);
Novamerican Steel Finco Inc. (Delaware); Integrated Steel Industries, Inc.


(Delaware); American Steel and
Aluminum Corporation (Massachusetts); Novamerican Tube Holdings, Inc.


(Delaware); Nova Tube and
Steel, Inc. (Delaware); and Nova Tube Indiana, LLC (Delaware); Novamerican


Steel Inc. (Canada); and 632422
N.B. Ltd. (Canada)        N/A
(represents Global Intercompany Note)


November 15,
2007        On Demand


 


 


Schedule III to


the Guarantee and


Collateral Agreement


 


 


INTELLECTUAL PROPERTY


None.


 


 


Schedule IV to


the Guarantee and


Collateral Agreement


 


 


COMMERCIAL TORT CLAIMS


 


 


None


 

















 


Exhibit I to


the Guarantee
and Collateral


Agreement


 


SUPPLEMENT NO.    dated
as of 
[                      ],
to the Guarantee and Collateral Agreement dated as of November 15, 2007, among
SYMMETRY HOLDINGS INC. (“Symmetry”), NOVAMERICAN STEEL FINCO INC. and
NOVAMERICAN STEEL INC. (the “Borrowers”), the other Subsidiaries of
Symmetry identified therein and JPMORGAN CHASE BANK, N.A., as Administrative
Agent (the “Administrative Agent”).


 


A. Reference
is made to the Credit Agreement dated as of November 15, 2007 (as amended,
supplemented or otherwise modified from time to time, the “Credit Agreement”),
among Symmetry, the Borrowers, the lenders from time to time party thereto, the
Administrative Agent and the other parties thereto.


 


B. Capitalized
terms used and not otherwise defined herein shall have the meanings assigned to
them in the Credit Agreement and the Guarantee and Collateral Agreement
referred to therein.


 


C. The Subsidiary
Parties have entered into the Guarantee and Collateral Agreement in order to
induce the Lenders and the Issuing Banks to extend credit to the Borrowers. Section 7.14
of the Guarantee and Collateral Agreement provides that additional Subsidiaries
may become Guarantors and Grantors under the Guarantee and Collateral Agreement
by execution and delivery of an instrument in the form of this Supplement. The
undersigned Subsidiary (the “New Subsidiary”) is executing this
Supplement in accordance with the requirements of the Credit Agreement to
become a “Guarantor” and a “Grantor” under the Guarantee and Collateral
Agreement (and [a “US Guarantor” and a “US Grantor” under the Guarantee and
Collateral Agreement] [a “Non-US Guarantor” and a “Non-US Grantor” under the
Guarantee and Collateral Agreement]) in order to induce the Lenders and the
Issuing Banks to extend additional credit to the Borrowers and as consideration
for the credit previously extended to the Borrowers.


 


Accordingly,
the Administrative Agent and the New Subsidiary agree as follows:


 


SECTION 1. In
accordance with Section 7.14 of the Guarantee and Collateral Agreement,
the New Subsidiary by its signature below becomes a Subsidiary Party (and
accordingly, becomes a “Guarantor” and a “Grantor” (and [a “US Guarantor” and a
“US Grantor”] [a “Non-US Guarantor” and a “Non-US Grantor”]) under the
Guarantee and Collateral Agreement, in each case with the same force and effect
as if originally named therein as such, and the New Subsidiary hereby
(i) agrees to all the terms and provisions of the Guarantee and Collateral
Agreement applicable to it in such capacities thereunder and
(ii) represents and warrants that the representations and warranties made
by it as a Guarantor and Grantor under the Guarantee and Collateral Agreement
are true and correct on and as of the date hereof. In furtherance of the
foregoing, the New Subsidiary, as security for the payment and performance in
full of the [Obligations] [Canadian Obligations] pursuant to the terms of the
Guarantee and 


 

















 


Collateral
Agreement, does hereby create and grant to the Administrative Agent, its
successors and assigns, for the benefit of the applicable Secured Parties,
their successors and assigns, a security interest in and lien on all of the New
Subsidiary’s right, title and interest in and to the [Pledged Collateral and
Article 9 Collateral] [ABL Collateral] of the New Subsidiary. Each reference to
a “Guarantor” or a “Grantor” (and [a “US Guarantor” and a “US Grantor”] [a “Non-US
Guarantor” and a “Non-US Grantor”]) in the Guarantee and Collateral Agreement
shall be deemed to include the New Subsidiary. The Guarantee and Collateral
Agreement is hereby incorporated herein by reference.


 


SECTION 2. The
New Subsidiary represents and warrants to the Administrative Agent and the
other Secured Parties that this Supplement has been duly authorized, executed
and delivered by it and constitutes its legal, valid and binding obligation,
enforceable against it in accordance with its terms.


 


SECTION 3. This
Supplement may be executed in counterparts, each of which shall constitute an
original, but all of which when taken together shall constitute a single
contract. This Supplement shall become effective when the Administrative Agent
shall have received a counterpart of this Supplement that bears the signature
of the New Subsidiary and the Administrative Agent has executed a counterpart
hereof. Delivery of an executed signature page to this Supplement by facsimile
or electronic transmission shall be as effective as delivery of a manually
signed counterpart of this Supplement.


 


SECTION 4. The
New Subsidiary hereby represents and warrants that (a) set forth on
Schedule I attached hereto is a true and correct schedule of the location
of any and all Collateral of the New Subsidiary, [(b) set forth on
Schedule II attached hereto is a true and correct schedule, as of the date
hereof, of (i) all the Equity Interests owned by the New Subsidiary, setting
forth the percentage of the issued and outstanding units of each class of the
Equity Interests of the issuer thereof so owned by the New Subsidiary and the
number of each certificate representing the same, and (ii) all debt securities
owned by the New Subsidiary, setting forth all promissory notes and other
instruments evidencing the same, (c) set forth on Schedule III
attached hereto is a true and correct schedule, as of the date hereof, of all
Intellectual Property of the New Subsidiary that would have been required to be
set forth on Schedule III to the Guarantee and Collateral Agreement, (d)
set forth on Schedule IV attached hereto is a true and correct schedule, as of
the date hereof, of all Commercial Tort Claims in respect of which a complaint
or a counterclaim has been filed by the New Subsidiary seeking damages in an amount
of US$1,000,000 or more] and (e) set forth under its signature hereto, is
the true and correct legal name of the New Subsidiary, its jurisdiction of
formation and the location of its chief executive office.


 


SECTION 5. Except
as expressly supplemented hereby, the Guarantee and Collateral Agreement shall
remain in full force and effect.


 


SECTION 6.
THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.


 

















 


SECTION 7. In
case any one or more of the provisions contained in this Supplement should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and in the
Guarantee and Collateral Agreement shall not in any way be affected or impaired
thereby (it being understood that the invalidity of a particular provision in a
particular jurisdiction shall not in and of itself affect the validity of such
provision in any other jurisdiction). The parties hereto shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.


 


SECTION 8. All
communications and notices hereunder shall be in writing and given as provided
in Section 7.01 of the Guarantee and Collateral Agreement.


 


SECTION 9. The
New Subsidiary agrees to reimburse the Administrative Agent for its reasonable
out-of-pocket expenses in connection with this Supplement, including the
reasonable fees, other charges and disbursements of counsel for the
Administrative Agent.


 


IN WITNESS
WHEREOF, the New Subsidiary and the Administrative Agent have duly executed
this Supplement to the Guarantee and Collateral Agreement as of the day and
year first above written.


 


	
   

  	
  [NAME OF NEW SUBSIDIARY],

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Legal Name:

  
	
   

  	
   

  	
   

  	
  Jurisdiction of Formation:

  
	
   

  	
   

  	
   

  	
  Location of Chief Executive Office:

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, N.A.,

  
	
   

  	
  as Administrative Agent,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title: