Document:

ex44vector2021offering

 Exhibit 4.4       SECURITY AGREEMENT        DATED JANUARY 28, 2021    between    EACH OF THE GRANTORS PARTY HERETO    and    U.S. BANK NATIONAL ASSOCIATION    as Collateral Agent  

 

  i    CONTENTS    Clause Page  1. Interpretation ........................................................................................................................1  2. Secured liabilities .................................................................................................................5  3. Creation of security ..............................................................................................................6  4. Perfection and further assurances ........................................................................................6  5. Representations and warranties ............................................................................................8  6. Undertakings ......................................................................................................................12  7. When security becomes enforceable ..................................................................................15  8. Enforcement of security .....................................................................................................15  9. Application of proceeds .....................................................................................................19  10. Expenses and indemnity ....................................................................................................19  11. Evidence and calculations ..................................................................................................20  12. Changes to the parties ........................................................................................................20  13. Miscellaneous ....................................................................................................................21  14. Severability ........................................................................................................................21  15. Release ...............................................................................................................................21  16. Notices ...............................................................................................................................22  17. Governing law ....................................................................................................................23  18. Enforcement .......................................................................................................................23  19. Intercreditor Agreement .....................................................................................................24      Schedule 1 – Commercial Tort Claims  Schedule 2 – Intellectual Property  Exhibit 1 – Form of Patent Security and Pledge Agreement  Exhibit 2 – Form of Trademark Security and Pledge Agreement  Exhibit 3 – Form of Copyright Security Agreement      

 

   1    THIS AGREEMENT is dated January 28, 2021  BETWEEN:  (1) LIGGETT GROUP LLC, a Delaware limited liability company, and 100 MAPLE  LLC, a Delaware limited liability company, as grantors (each a “Grantor” and,  collectively, the “Grantors”); and  (2) U.S. BANK NATIONAL ASSOCIATION, as collateral agent for the Noteholders  under the Indenture described below (in this capacity, the “Collateral Agent”).  BACKGROUND:  The Grantors enter into this Agreement in connection with the Indenture, dated January 28, 2021  (as amended, supplemented, or otherwise modified from time to time, the “Indenture”), by and  among Vector Group Ltd. (“Vector Group”), the Guarantors party thereto and U.S. Bank  National Association, as trustee (together with any successor in such capacity, the “Trustee”).   Pursuant to the Indenture, Vector Group is issuing Notes and the Grantors are guaranteeing the  Notes as provided in the Indenture.  The Grantors now wish to secure their obligations under the  Indenture by entering into this Agreement.  IT IS AGREED as follows:  1. INTERPRETATION  1.1 Definitions  In this Agreement:  “ABL Debt” has the meaning given to that term in the Intercreditor Agreement.  The term “Collateral” means all personal property, wherever located, in which any  Grantor now has or later acquires any right, title or interest, including all:  (a) accounts and chattel paper;  (b) goods (including equipment, inventory and fixtures);  (c) health-care-insurance receivables;  (d) instruments (including promissory notes);  (e) documents;  (f) letter-of-credit rights;  (g) general intangibles (including payment intangibles and software);  (h) the commercial tort claims described in Schedule 1 (Commercial Tort Claims);  

 

   2  (i) supporting obligations;  (j) Intellectual Property (together with the right to sue or otherwise recover for past,  present and future infringement, misappropriation, dilution or other violation or  impairment thereof, and all proceeds of the foregoing, including license fees,  royalties, income, payments, claims, damages and proceeds of suit) and  Intellectual Property Licenses; and  (k) to the extent not listed above as Collateral, proceeds and products of, and  accessions to, each of the above assets.  The term “Collateral” excludes (i) any property, right or interest in which a security  interest may not be granted under applicable law, (ii) any equity interest of a Grantor in  any Affiliate of such Grantor, (iii) any equipment to the extent a grant of a security  interest in such equipment would be precluded by or require a consent under the terms  and conditions of any existing or future purchase money or other financing of such  equipment permitted under the terms of the Indenture, (iv) any intent-to-use trademark  application prior to the filing of a “Statement of Use” or “Amendment to Allege Use”  with respect thereto, to the extent, if any, that, and solely during the period, if any, in  which, the grant of a security interest therein would impair the validity or enforceability  of such intent-to-use trademark application or any registration that issues therefrom under  applicable federal law, (v) any aircraft, aircraft engines or motor vehicles, (vi) any  deposit accounts, (vii) any cash (other than any identifiable proceeds of Collateral), (viii)  any investment property and (ix) any Excluded Assets.  “Copyright Licenses” means any and all agreements providing for the granting of any  right in or to Copyrights or otherwise providing for a covenant not to sue (whether the  Grantor is licensee or licensor thereunder) including each Exclusive Copyright License  referred to in Schedule 2 under the heading “Copyright Licenses” (as such schedule may  be amended or supplemented from time to time).  “Copyrights” means all United States copyrights (including Community designs),  including copyrights in software and databases, and all Mask Works (as defined under 17  U.S.C. 901 of the U.S. Copyright Act), whether registered or unregistered, including: (a)  all registrations and applications therefor including, the registrations and applications  required to be listed in Schedule 2 under the heading “Copyrights” (as such schedule may  be amended or supplemented from time to time) and (b) all extensions and renewals  thereof.  “Finance Documents” means the Indenture, all Notes issued from time to time under the  Indenture, this Agreement and all other pledges, security agreements, control agreements  and other agreements and documents entered into in connection with the transactions  contemplated by the Indenture.  “First Priority Debt” has the meaning given to that term in the Intercreditor Agreement.  “Guarantors” means the Grantors and the other guarantors under the Indenture.  

 

   3  “Intellectual Property” means, collectively, all intellectual property and proprietary  rights, including Copyrights, Patents, Trademarks and Trade Secrets.  “Intellectual Property Licenses” means, collectively, all agreements providing for the  granting of any right in or to any Intellectual Property (whether the Grantor is licensee or  licensor thereunder), including the Copyright Licenses, the Patent Licenses, the  Trademark Licenses and the Trade Secret Licenses.  “Intercreditor Agreement” means the Second Amended and Restated Intercreditor and  Lien Subordination Agreement, dated January 28, 2021, between Wells Fargo Bank,  National Association, as agent, the Collateral Agent, Liggett Group LLC, 100 Maple  LLC and each other party from time to time party thereto, as amended, supplemented, or  otherwise modified from time to time.  “Note” means any note issued from time to time under the Indenture.  “Noteholder” means any Person that from time to time is the holder of a Note.  “Obligors” means Vector Group and the Guarantors.  “Patent Licenses” means any and all agreements providing for the granting of any right  in or to Patents or otherwise providing for a covenant not to sue under Patents (whether  the Grantor is licensee or licensor thereunder).  “Patents” means all United States patents and certificates of invention, or similar  industrial property rights, and applications for any of the foregoing, including: (a) each  patent and patent application required to be listed in Schedule 2 hereto under the heading  “Patents” (as such schedule may be amended or supplemented from time to time) and (b)  all reissues, divisions, continuations, continuations-in-part, extensions, renewals, and  reexaminations thereof and (c) all inventions and improvements described therein.  “Priority Liens” means the Liens securing the First Priority Debt.  “Relevant State” means the state under whose laws a Grantor is incorporated or  organized.  “Secured Liabilities” means each liability and obligation specified in Clause 2 (Secured  Liabilities).  “Secured Parties” means the Trustee, the Collateral Agent, the Paying Agent, the  Registrar and the Noteholders.   “Security” means any security interest created by this Agreement.  “Security Period” means the period beginning on the date of this Agreement and ending  on the date on which all the Secured Liabilities have been indefeasibly, unconditionally  and irrevocably paid and discharged in full (other than in respect of contingent  obligations for which no claim has been asserted).  The Security Period will be extended  

 

   4  to take into account any extension or reinstatement of this Agreement under Clause 3.2(b)  (General).    “Trademark Licenses” means any and all agreements providing for the granting of any  right in or to Trademarks or permitting co-existence with respect to Trademarks (whether  the Grantor is licensee or licensor thereunder).  “Trademarks” means all United States trademarks, trade names, corporate names,  company names, business names, fictitious business names, Internet domain names,  service marks, certification marks, collective marks, logos, or other source or business  identifiers, and all registrations and applications for any of the foregoing including: (a)  the registrations and applications required to be listed in Schedule 2 under the heading  “Trademarks” (as such schedule may be amended or supplemented from time to time),  (b) all extensions and renewals of any of the foregoing and (c) all of the goodwill of the  business connected with the use of and symbolized by the foregoing.  “Trade Secret Licenses” means any and all agreements providing for the granting of any  right in or to Trade Secrets or otherwise providing for a covenant not to sue under Trade  Secrets (whether a Grantor is licensee or licensor thereunder).   “Trade Secrets” means all trade secrets and all other confidential proprietary  information and know-how, whether or not reduced to a writing or other tangible form.  “UCC” means the Uniform Commercial Code as in effect from time to time in the State  of New York.  1.2 Construction  (a) Any term defined in the UCC and not defined in this Agreement has the meaning  given to that term in the UCC.  (b) Any term defined in the Indenture and not defined in this Agreement or the UCC  has the meaning given to that term in the Indenture.  (c) No reference to “proceeds” in this Agreement authorizes any sale, transfer or  other disposition of Collateral by a Grantor that is not permitted by the Indenture.  (d) In this Agreement, unless the contrary intention appears, a reference to:  (i) an “amendment” includes a supplement, novation, restatement or re- enactment and “amended” will be construed accordingly;  (ii) a Clause, a Subclause, an Exhibit or a Schedule is a reference to a Clause  or Subclause of, or an Exhibit or Schedule to, this Agreement;  (iii) a law is a reference to that law as amended or re-enacted and to any  successor law;  

 

   5  (iv) an agreement is a reference to that agreement as amended;  (v) “fraudulent transfer law” means any applicable U.S. Bankruptcy Law or  state fraudulent transfer or conveyance statute, and the related case law;  and  (vi) “law” includes any law, statute, regulation, regulatory requirement, rule,  ordinance, ruling, decision, treaty, directive, order, guideline, regulation,  policy, writ, judgment, injunction or request of any court or other  governmental, inter-governmental or supranational body, officer or  official, fiscal or monetary authority, or other ministry or public entity  (and their interpretation, administration and application), whether or not  having the force of law.  (e) In this Agreement:  (i) “includes” and “including” are not limiting;  (ii) “or” is not exclusive; and  (iii) the headings are for convenience only, do not constitute part of this  Agreement and are not to be used in construing it.  2. SECURED LIABILITIES  2.1 Secured Liabilities  Each obligation and liability whether:  (a) present or future, actual, contingent or unliquidated; or  (b) owed jointly or severally (or in any other capacity whatsoever),  of any Grantor to any Noteholder, the Trustee, the Paying Agent, the Registrar or the  Collateral Agent under or in connection with each Finance Document is a Secured  Liability.  2.2 Specification of Secured Liabilities  The Secured Liabilities include any liability or obligation for:  (a) repayment of the principal of any Note;  (b) payment of interest and any other amount payable under the Finance Documents;  (c) payment and performance of all other obligations and liabilities of any Obligor  under the Finance Documents;  

 

   6  (d) payment of any amount owed under any amendment, modification, renewal,  extension or novation of any of the above obligations; and  (e) payment of any amount that arises after a petition is filed by, or against, any  Obligor under the U.S. Bankruptcy Code of 1978 even if the obligations do not  accrue because of the automatic stay under Section 362 of the U.S. Bankruptcy  Code of 1978 or otherwise.  3. CREATION OF SECURITY  3.1 Security Interest  As security for the prompt and complete payment and performance of the Secured  Liabilities when due (whether due because of stated maturity, acceleration, mandatory  prepayment, or otherwise) and to induce the Noteholders to purchase the Notes, each  Grantor grants to the Collateral Agent for the benefit of the Secured Parties a continuing  security interest in such Grantor’s right, title and interest in and to the Collateral.  3.2 General  (a) All the Security created under this Agreement:  (i) is continuing security for the irrevocable and indefeasible payment in full  of the Secured Liabilities, regardless of any intermediate payment or  discharge in whole or in part;  (ii) is in addition to, and not in any way prejudiced by, any other security now  or subsequently held by the Collateral Agent.  (b) If, at any time for any reason (including the bankruptcy, insolvency, receivership,  reorganization, dissolution or liquidation of any Obligor or the appointment of  any receiver, intervenor or conservator of, or agent or similar official for, any  Obligor or any of their respective properties), any payment received by the  Collateral Agent or any Noteholder in respect of the Secured Liabilities is  rescinded or avoided or must otherwise be restored or returned by the Collateral  Agent or any Noteholder, that payment will not be considered to have been made  for purposes of this Agreement, and this Agreement will continue to be effective  or will be reinstated, if necessary, as if that payment had not been made.  (c) This Agreement is enforceable against the Grantors to the maximum extent  permitted by the fraudulent transfer laws.  4. PERFECTION AND FURTHER ASSURANCES  4.1 General perfection  Each Grantor shall take, at its own expense, promptly, and in any event within any  applicable time limit:  

 

   7  (a) whatever action is necessary; and  (b) any action that the Collateral Agent may reasonably require,  to ensure that the Security is, as of the date the Notes are first issued under the Indenture,  and will continue to be until the end of the Security Period, a validly created, attached,  enforceable and perfected continuing security interest in the U.S. Collateral, to the extent  such security interest can be perfected by the filing of financing statements and short- form security interests as described in Sections 4.2 and 4.3, subject to no Liens other than  Permitted Liens and subject in priority to no Liens other than Priority Liens and  Permitted Prior Liens, in all relevant jurisdictions, securing payment and performance of  the Secured Liabilities.  This includes the giving of any notice, order or direction, the making of any filing or  registration, the passing of any resolution and the execution and delivery of any  documents or agreements which the Collateral Agent may reasonably require.  4.2 Filing of financing statements  (a) Each Grantor authorizes the Collateral Agent to prepare and file, at such  Grantor’s expense:  (i) financing statements describing the Collateral as “all assets” or “all  personal property” or words of similar effect, of such Grantor, whether  now owned or hereafter existing or acquired by such Grantor;  (ii) continuation statements; and  (iii) any amendment in respect of those statements.  (b) Promptly after filing an initial financing statement in respect of the Collateral,  each Grantor must provide the Collateral Agent with an official report from the  Secretary of State of such Grantor’s Relevant State indicating that the Collateral  Agent’s security interest in the Collateral provided by such Grantor incorporated  or organized under the laws of such Relevant State is prior to all other security  interests or other interests reflected in the report other than Liens securing the  ABL Debt or other Permitted Prior Liens.  4.3 Intellectual Property Recording RequirementsIn the case of any Collateral consisting  of U.S. Patents that are issued by or subject to a pending application before the  U.S. Patent and Trademark Office and owned by such Grantor, such Grantor shall  execute and deliver to the Collateral Agent a Patent Security Agreement in  substantially the form of Exhibit 1 hereto (or a supplement thereto) covering all  such Patents, in appropriate form for recordation with the U.S. Patent and  Trademark Office with respect to the security interest of the Collateral Agent.  (b) In the case of any Collateral consisting of U.S. Trademarks that are registered  with or subject to a pending application before the U.S. Patent and Trademark  

 

   8  Office and owned by such Grantor, such Grantor shall execute and deliver to the  Collateral Agent a Trademark Security Agreement in substantially the form of  Exhibit 2 hereto (or a supplement thereto) covering all such Trademarks in  appropriate form for recordation with the U.S. Patent and Trademark Office with  respect to the security interest of the Collateral Agent.  (c) In the case of any Collateral consisting of registered U.S. Copyrights registered  with the U.S. Copyright Office and owned by such Grantor, and Copyright  Licenses in respect of U.S. Copyrights registered with the U.S. Copyright Office  for which any Grantor is the exclusive licensee (“Exclusive Copyright  Licenses”), such Grantor shall execute and deliver to the Collateral Agent a  Copyright Security Agreement in substantially the form of Exhibit 3 hereto (or a  supplement thereto) covering all such Copyrights and Exclusive Copyright  Licenses is in appropriate form for recordation with the U.S. Copyright Office  with respect to the security interest of the Collateral Agent.  4.4 Further assurances  (a) The Grantors shall take, at their own expense, promptly, and in any event within  any applicable time limit, whatever action may reasonably be required under the  Indenture or this Agreement for:  (i) creating, attaching, perfecting and protecting, and maintaining the priority  of, any security interest intended to be created by this Agreement;  (ii) facilitating the enforcement of the Security or the exercise of any right,  power or discretion exercisable by the Collateral Agent or any of its  delegates or sub-delegates in respect of any Collateral; and  (iii) facilitating the assignment or transfer of any rights and/or obligations of  the Collateral Agent under this Agreement.  Such actions include the execution and delivery of any transfer, assignment or other  agreement or document, whether to the Collateral Agent or its nominee, that the  Collateral Agent may reasonably require.  (b) Each Grantor irrevocably constitutes and appoints the Collateral Agent, with full  power of substitution, as such Grantor’s true and lawful attorney-in-fact, in such  Grantor’s name or in the Collateral Agent’s name or otherwise, and at such  Grantor’s expense, to take any of the actions referred to in paragraph (a) above  without notice to or the consent of such Grantor.  This power of attorney is a  power coupled with an interest and cannot be revoked.  Each Grantor ratifies and  confirms all actions taken by the Collateral Agent or its agents under this power  of attorney.  5. REPRESENTATIONS AND WARRANTIES  Representations and warranties  

 

   9  The representations and warranties set out in this Clause are made by each Grantor to the  Collateral Agent and each Noteholder.  5.1 The Grantors  (a) It is organized under the laws of the state indicated in the preamble to this  Agreement.  (b) In the case of Liggett Group LLC:  (i) Its exact legal name, as it appears in the public records of its jurisdiction  of organization, is as stated in the preamble to this Agreement.  It has not  changed its name, whether by amendment of its organizational documents,  reorganization, merger or otherwise, in the past five years.  (ii) Its organizational identification number, as issued by its jurisdiction of  organization is 2232980.    (c) In the case of 100 Maple LLC:  (i) Its exact legal name, as it appears in the public records of its jurisdiction  of organization, is as stated in the preamble to this Agreement.  It has not  changed its name, whether by amendment of its organizational documents,  reorganization, merger or otherwise, in the past five years.  (ii) Its organizational identification number, as issued by its jurisdiction of  organization is 3037646.  (d) It keeps at its address indicated in Clause 16 (Notices) its corporate records and  all records, documents and instruments constituting, relating to or evidencing  Collateral.  5.2 The Collateral  (a) Except as permitted under the Indenture:  (i) it is the sole legal and beneficial owner of, and has the power to transfer  and grant a security interest in, the Collateral;  (ii) none of the Collateral is subject to any Lien other than the Collateral  Agent’s security interest and Liens securing the ABL Debt and other  Permitted Liens;  (iii) it has not agreed or committed to sell, assign, pledge, transfer, lease, or  grant any Lien (other than Permitted Liens) on any of the Collateral, or  granted any option, warrant or right with respect to any of the Collateral;  and  

 

   10  (iv) no effective mortgage, deed of trust, financing statement, security  agreement or other instrument similar in effect is on file or of record with  respect to any Collateral, except for those that create, perfect or evidence  the Collateral Agent’s security interest or Liens securing the ABL Debt or  other Permitted Liens.  (b) No litigation, arbitration or administrative proceedings are current or pending or,  to its knowledge, threatened, involving or affecting the Collateral, and none of the  Collateral is subject to any order, writ, injunction, execution or attachment, in  each case, that would reasonably be expected to have a material adverse effect on  the Collateral Agent’s security interest or the Collateral Agent’s rights under this  Agreement.   5.3 No liability  Except, in each case, as would not reasonably be expected to adversely affect the  Collateral Agent’s security interest  or the Collateral Agent’s rights under this Agreement  in any material respect:   (a) its rights, interests, liabilities and obligations under contractual obligations that  constitute part of the Collateral are not affected by this Agreement or the exercise  by the Collateral Agent of its rights under this Agreement;  (b) neither the Collateral Agent nor any Noteholder, unless it expressly agrees in  writing, will have any liabilities or obligations under any contractual obligation  that constitutes part of the Collateral as a result of this Agreement, the exercise by  the Collateral Agent of its rights under this Agreement or otherwise; and  (c) neither the Collateral Agent nor any Noteholder has or will have any obligation to  collect upon or enforce any contractual obligation or claim that constitutes part of  the Collateral, or to take any other action with respect to the Collateral.  5.4 Consideration and solvency  (a) Terms used in this Subclause have the meanings given to them in, and must be  construed in accordance with, the fraudulent transfer laws.  (b) It will receive valuable direct and indirect benefits as a result of the transactions  financed by the issuance of the Notes and these benefits constitute “reasonably  equivalent value” and “fair consideration” as those terms are used in the  fraudulent transfer laws.  (c) To the best of its knowledge, the Secured Parties have acted in good faith in  connection with the transactions contemplated by this Agreement.  (d) The sum of its debts (including its obligations under this Agreement) is less than  the value of its property (calculated at the lesser of fair valuation and present fair  saleable value).  

 

   11  (e) Its capital is not unreasonably small to conduct its business as currently conducted  or as proposed to be conducted.  (f) It has not incurred, does not intend to incur and does not believe it will incur debts  beyond its ability to pay as they mature.  (g) It has not made a transfer or incurred an obligation under this Agreement with the  intent to hinder, delay or defraud any of its present or future creditors.  5.5 Intellectual Property  (a) Schedule 2 (as such schedule may be amended or supplemented from time to  time) lists all registered Copyrights and applications therefor, issued Patents and  Patent applications and all registered Trademarks and applications therefor, in  each case owned or purported to be owned by such Grantor, and to its knowledge,  (i) such Grantor is the sole and exclusive owner of the entire right, title, and  interest in and to all Intellectual Property listed on Schedule 2 (as such schedule  may be amended or supplemented from time to time), and (ii) owns or has the  valid right to use and, where such Grantor does so, sublicense others to use, all  other Intellectual Property used in and necessary to conduct its business, in each  case, free and clear of all Liens except for Permitted Liens.   (b) All Intellectual Property material to its business and owned by such Grantor is  subsisting and has not been adjudged invalid or unenforceable, in whole or in  part, nor are any Patents owned by such Grantor and material to its business the  subject of a reexamination proceeding, and such Grantor has performed all acts  and has paid all renewal, maintenance, and other fees and taxes required to  maintain each and every registration and application of Copyrights, Patents and  Trademarks owned by such Grantor and material to its business in full force and  effect.  (c) (i) To the knowledge of the applicable Grantor, all Intellectual Property material  to its business and owned by such Grantor is valid and enforceable; and (ii) no  action or proceeding is pending or, to the best of the applicable Grantor’s  knowledge, threatened before any court or administrative authority challenging  the validity or scope of, such Grantor’s right to register, or such Grantor’s rights  to own or use, any Intellectual Property material to its business.  (d) All registrations and applications for Copyright registrations, Patents and  Trademark registrations material to such Grantor’s business and owned or  purported to be owned by such Grantor are standing in the name of such Grantor.  (e) Such Grantor uses commercially reasonable standards of quality in the  manufacture, distribution, and sale of all products sold and in the provision of all  services rendered under or in connection with all Trademarks owned by such  Grantor and material to its business, and has taken commercially reasonable  actions to ensure that all licensees of the Trademarks owned by such Grantor and  material to its business use adequate standards of quality.  

 

   12  (f) To the best of such Grantor’s knowledge, the conduct of such Grantor’s business  does not infringe upon or misappropriate or otherwise violate any trademark,  patent, copyright, trade secret or other intellectual property right of any other  Person in any manner that is or would reasonably be expected to be material to its  business; except as would not reasonably be expected to be material, no  unresolved claim has been asserted in writing against Grantor asserting that such  Grantor infringes upon, misappropriates or otherwise violates the intellectual  property rights of any other Person, or otherwise demanding that the Grantor enter  into a license or co-existence agreement.  (g) To the best of such Grantor’s knowledge, no other Person is infringing upon,  misappropriating or otherwise violating any rights in any Intellectual Property  owned by such Grantor in a manner that would reasonably be expected to be  material to such Grantor’s business.  (h) No settlement or consents, covenants not to sue, co-existence agreements, non- assertion assurances, or releases have been entered into by such Grantor or bind  such Grantor in a manner that could adversely affect in any material respect such  Grantor’s rights to own, license or use any Intellectual Property material to its  business.  5.6 Times for making representations and warranties  (a) The representations and warranties set out in this Agreement (including in this  Clause 5) are made on the date of this Agreement.  (b) The representations and warranties under Clause 5.5 are deemed to be repeated by  the Grantors on the date of each issuance of Notes under the Indenture with  reference to the facts and circumstances then existing.  (c) When representations and warranties are repeated, they are applied to the  circumstances existing at the time of repetition.  (d) The representations and warranties of the Grantors contained in this Agreement or  made by any Grantor in any certificate, notice or report delivered under this  Agreement will survive each issuance of Notes and any transfer or assignment of  the Notes.  6. UNDERTAKINGS  Undertakings  The Grantors agree to be bound by the covenants set out in this Clause.  6.1 The Grantors  (a) Except as permitted under the Indenture, each Grantor shall preserve its limited  liability company existence and will not, except as permitted by the Indenture, in  

 

   13  one transaction or a series of related transactions, merge into or consolidate with  any other entity, or sell all or substantially all of its assets.  (b) No Grantor shall change the jurisdiction of its organization without providing the  Collateral Agent with at least 10 days’ prior written notice.  (c) No Grantor shall change its name without providing the Collateral Agent with at  least 10 days’ prior written notice.  (d) Each Grantor shall keep at its address indicated in, or otherwise notified to the  Collateral Agent pursuant to, Clause 16 (Notices) its corporate records and all  records, documents and instruments constituting, relating to or evidencing  Collateral.  (e) Each Grantor shall permit the Collateral Agent and its agents and representatives,  at mutually agreed times during normal business hours and upon reasonable  notice, to inspect the Collateral, to examine and make copies of and abstracts  from the records referred to in paragraph (d) above, and to discuss matters relating  to the Collateral directly with such Grantor’s officers and employees.  (f) At the Collateral Agent’s request, the Grantors shall provide the Collateral Agent  with any information concerning the Collateral that the Collateral Agent may  reasonably request.  6.2 The Collateral  (a) Except as permitted by the Indenture or this Agreement, the Grantors:  (i) shall maintain sole legal and beneficial ownership of the Collateral;  (ii) shall not permit any Collateral to be subject to any Lien other than the  Collateral Agent’s security interest and Liens securing the ABL Debt and  other Permitted Liens and shall at all times warrant and defend the  Collateral Agent’s security interest in the Collateral against all other Liens  (other than Permitted Prior Liens and other Permitted Liens) and  claimants;  (iii) shall not sell, assign, transfer, pledge, license, lease or further encumber,  or grant any option, warrant, or right with respect to, any of the Collateral,  or agree or contract to do any of the foregoing; and  (iv) shall not waive, amend or terminate, in whole or in part, any material  accessory or ancillary right or other right in respect of any Collateral.  (b) The Grantors shall pay, prior to delinquency, all material taxes, assessments and  governmental levies imposed on or in respect of Collateral and all claims against  the Collateral, including claims for labor, materials and supplies, in each case,  except such as are contested in good faith and by appropriate proceedings or  

 

   14  where the failure to effect such payment is not adverse in any material respect to  the Collateral Agent.   (c) In any suit, legal action, arbitration or other proceeding involving the Collateral or  the Collateral Agent’s security interest, the Grantors shall take all lawful action to  avoid impairment of the Collateral Agent’s security interest or the Collateral  Agent’s rights under this Agreement or the imposition of a Lien (other than  Permitted Liens) on any Collateral.  6.3 Intellectual Property  (a) It shall not do any act or omit to do any act whereby any of the Intellectual  Property which is owned by and material to the business of such Grantor may  lapse, or become abandoned, dedicated to the public, or unenforceable, or which  would adversely affect the validity, grant, or enforceability of the security interest  granted therein (except, in each case, to the extent such action or inaction is  deemed advisable in such Grantor’s reasonable business judgment).   (b) It shall not, with respect to any Trademarks owned by such Grantor and material  to its business, cease the use of any of such Trademarks or fail to maintain the  level of the quality of products sold and services rendered under any of such  Trademark at a level at least substantially consistent with the quality of such  products and services as of the date hereof, and such Grantor shall take  commercially reasonable steps to ensure that licensees of such Trademarks use  such consistent standards of quality (except, in each case, to the extent such action  or inaction is deemed advisable in such Grantor’s reasonable business judgment).  (c) It shall take all reasonable steps in the United States Patent and Trademark Office  and the United States Copyright Office to continue prosecution of any current  application and maintain any registration of each Trademark, Patent, and  Copyright, in each case, that is owned by and material to such Grantor  (d) It shall hereafter use commercially reasonable efforts so as not to permit the  inclusion in any contract to which it hereafter becomes a party of any provision  that would materially impair or prevent the creation of a security interest in, or the  assignment of, such Grantor’s rights and interests in any Intellectual Property  material to its business acquired under such contracts.    (e) In the event that the Grantor becomes aware that any Intellectual Property owned  by the Grantor and material to its business is infringed, misappropriated, or  diluted by a third party, the Grantor shall promptly take such actions the Grantor  deems appropriate under the circumstances, in its reasonable business judgment,  to protect its rights in such Intellectual Property.  (f) It shall take commercially reasonable steps to protect the secrecy of its material  Trade Secrets, including, to the extent such action is deemed advisable in such  Grantor’s reasonable business judgment, by entering into confidentiality  

 

   15  agreements with employees and consultants and labeling and restricting access to  secret information and documents.  6.4 Notices  (a) The Grantors shall give the Collateral Agent prompt notice of the occurrence of  any of the following events:  (i) any pending or threatened claim, suit, legal action, arbitration or other  proceeding involving or affecting any Grantor or any Collateral that would  reasonably be expected to materially impair the Collateral Agent’s  security interest or the Collateral Agent’s rights under this Agreement or  result in the imposition of a Lien (other than Permitted Liens) on any  Collateral;  (ii) any loss or damage to any material portion of the Collateral; or  (iii) any representation or warranty contained in this Agreement is or becomes  untrue, incorrect or incomplete in any material respect.  (b) Each notice delivered under this Clause, shall include:  (i) reasonable details about the event; and  (ii) the Grantors’ proposed course of action.  Delivery of a notice under this Clause does not affect any Grantor’s obligations to  comply with any other term of this Agreement.  7. WHEN SECURITY BECOMES ENFORCEABLE  Subject to the terms of the Indenture, this Security may be enforced by the Collateral  Agent at any time after an Event of Default has occurred and is continuing.  8. ENFORCEMENT OF SECURITY  8.1 [Reserved]  8.2 General  (a) After this Security has become enforceable, the Collateral Agent may  immediately, in its absolute discretion but subject to the Intercreditor Agreement,  exercise any right under:  (i) applicable law; or  (ii) this Agreement,  

 

   16  to enforce all or any part of the Security in respect of any Collateral in any manner or  order it sees fit.  (b) The foregoing includes:  (i) any rights and remedies available to the Collateral Agent under applicable  law and under the UCC (whether or not the UCC applies to the affected  Collateral and regardless of whether or not the UCC is the law of the  jurisdiction where the rights or remedies are asserted) as if those rights and  remedies were set forth in this Agreement in full;  (ii) transferring or assigning to, or registering in the name of, the Collateral  Agent or its nominees any of the Collateral;  (iii) exercising any consent and other rights relating to any Collateral;  (iv) performing or complying with any contractual obligation that constitutes  part of the Collateral;  (v) receiving, endorsing, negotiating, executing and delivering or collecting  upon any check, draft, note, acceptance, account, instrument, document,  letter of credit, contract, agreement, receipt, release, bill of lading, invoice,  endorsement, assignment, bill of sale, deed, security, share certificate,  stock power, proxy, or instrument of conveyance or transfer constituting  or relating to any Collateral;  (vi) asserting, instituting, filing, defending, settling, compromising, adjusting,  discounting or releasing any suit, action, claim, counterclaim, right of set- off or other right or interest relating to any Collateral;  (vii) executing and delivering acquittances, receipts and releases in respect of  Collateral; and  (viii) exercising any other right or remedy available to the Collateral Agent  under the other Finance Documents or any other agreement between the  parties.  8.3 Collections after an Event of Default  Subject to the rights of the holders of First Priority Debt under the Intercreditor  Agreement:  (a) if an Event of Default occurs and is continuing, the Grantors shall hold all funds  and other property received or collected in respect of the Collateral in trust for the  Collateral Agent, and shall keep these funds and this other property segregated  from all other funds and property so as to be capable of identification;  

 

   17  (b) the Grantors shall deliver those funds and that other property to the Collateral  Agent in the identical form received, properly endorsed or assigned when required  to enable the Collateral Agent to complete collection; and  (c) after the occurrence and during the continuation of an Event of Default, no  Grantor may settle, compromise, adjust, discount or release any claim in respect  of Collateral, and no Grantor may accept any returns of merchandise other than in  the ordinary course of business.  8.4 Collateral Agent’s rights upon default  (a) Each Grantor irrevocably constitutes and appoints the Collateral Agent, with full  power of substitution, as such Grantor’s true and lawful attorney-in-fact, in such  Grantor’s name or in the Collateral Agent’s name or otherwise, and at such  Grantor’s expense, to take any of the actions authorized by this Agreement or  permitted under applicable law upon the occurrence and during the continuation  of an Event of Default, without notice to or the consent of such Grantor.  This  power of attorney is a power coupled with an interest and cannot be revoked.   Each Grantor ratifies and confirms all actions taken by the Collateral Agent or its  agents under this power of attorney.  (b) The Grantors agree that 10 days’ notice shall constitute reasonable notice in  connection with any sale, transfer or other disposition of Collateral.  (c) The Collateral Agent may comply with any applicable state or federal law  requirements in connection with a disposition of Collateral and compliance will  not be considered adversely to affect the commercial reasonableness of any sale  of Collateral.  (d) The grant to the Collateral Agent under this Agreement of any right, power or  remedy does not impose upon the Collateral Agent any duty to exercise that right,  power or remedy.  The Collateral Agent will have no obligation to take any steps  to preserve any claim or other right against any Person or with respect to any  Collateral.  (e) The Grantors bear the risk of loss, damage, diminution in value, or destruction of  the Collateral.  (f) The Collateral Agent will have no responsibility for any act or omission of any  courier, bailee, broker, bank, investment bank or any other Person chosen by it  with reasonable care.  (g) The Collateral Agent makes no express or implied representations or warranties  with respect to any Collateral or other property released to the Grantors or their  respective successors and assigns.  

 

   18  (h) The Grantors agree that the Collateral Agent will have met its duty of care under  applicable law if it holds, maintains and disposes of Collateral in the same manner  that it holds, maintains and disposes of property for its own account.  (i) Except as set forth in this Clause or as required under applicable law, the  Collateral Agent will have no duties or obligations under this Agreement or  otherwise with respect to the Collateral.  (j) The sale, transfer or other disposition under this Agreement of any right, title, or  interest of any Grantor in any item of Collateral will:  (i) operate to divest such Grantor permanently and all Persons claiming under  or through such Grantor of that right, title, or interest, and  (ii) be a perpetual bar, both at law and in equity, to any claims by such  Grantor or any Person claiming under or through such Grantor  with respect to that item of Collateral.  8.5 No marshaling  (a) The Collateral Agent need not, and the Grantors irrevocably waive and agree that  they shall not invoke or assert any law requiring the Collateral Agent to:  (i) attempt to satisfy the Secured Liabilities by collecting them from any  other Person liable for them; or  (ii) marshal any security or guarantee securing payment or performance of the  Secured Liabilities or any particular asset of any Grantor.  (b) The Collateral Agent may release, modify or waive any collateral or guarantee  provided by any other Person to secure any of the Secured Liabilities, without  affecting the Collateral Agent’s rights against the Grantors.  8.6 Grant of Intellectual Property License   For the purpose of enabling the Collateral Agent, during the continuance of an Event of  Default, to exercise rights and remedies under this Clause 8 at such time as the Collateral  Agent shall be lawfully entitled to exercise such rights and remedies, and for no other  purpose, the Grantor hereby grants to the Collateral Agent an irrevocable, non-exclusive  license to use, license or sublicense any of the Intellectual Property now owned or  hereafter acquired by such Grantor, wherever the same may be located.  Such license  shall be subject, in the case of Trademarks, to sufficient rights to quality control and  inspection in favor of the Grantor to avoid the risk of invalidation of said Trademarks.   Such license shall include reasonable access to all media in which any of the licensed  items may be recorded or stored and to all computer programs used for the compilation or  printout hereof.  

 

   19  9. APPLICATION OF PROCEEDS  Any moneys received in connection with the Collateral by the Collateral Agent after this  Security has become enforceable shall be applied in the following order of priority:  (a) first, in or towards payment of or provision for all costs and expenses incurred by  the Collateral Agent in connection with the enforcement of this Security;  (b) second, in or towards payment of, or provision for, the Secured Liabilities; and  (c) third, in payment of the surplus (if any) to the Grantors or any other Person  entitled to it under applicable law.  This Clause is subject to the prior payment of First Priority Debt in accordance with the  terms of the Intercreditor Agreement and claims having priority over this Security under  mandatory provisions of applicable law.  This Clause does not prejudice the right of any  Noteholder to recover any shortfall from the Grantors, and the preceding sentence shall  not be deemed or interpreted as a waiver or modification of Clause 6.3(a) (The  Collateral).  10. EXPENSES AND INDEMNITY  (a) The Grantors shall pay promptly on demand to the Collateral Agent all reasonable  and documented costs and expenses incurred by the Collateral Agent, any  Noteholder, attorney, manager, delegate, sub-delegate, agent or other Person  appointed by the Collateral Agent under this Agreement for the purpose of  enforcing its rights under this Agreement.  Such costs and expenses include:  (i) costs of foreclosure and of any transfer, disposition or sale of Collateral;  (ii) costs of maintaining or preserving the Collateral or assembling it or  preparing it for transfer, disposition or sale;  (iii) costs of obtaining money damages; and  (iv) fees and expenses of attorneys employed by the Collateral Agent for any  purpose related to this Agreement or the Secured Liabilities, including  consultation, preparation and negotiation of any amendment or  restructuring, drafting documents, sending notices or instituting,  prosecuting or defending litigation or arbitration.  (b) The Grantors shall indemnify and keep indemnified the Secured Parties and their  respective affiliates, directors, officers, representatives and agents from and  against all claims, liabilities, obligations, losses, damages, penalties, judgments,  costs and expenses of any kind (including attorney’s fees and expenses) that may  be imposed on, incurred by or asserted against any of them by any Person  (including any Noteholder) in any way relating to or arising out of:  

 

   20  (i) this Agreement;  (ii) the Collateral;  (iii) the Collateral Agent’s security interest in the Collateral;  (iv) any Event of Default;  (v) any action taken or omitted by the Collateral Agent under this Agreement  or any exercise or enforcement of rights or remedies under this  Agreement; or  (vi) any transfer sale or other disposition of or any realization on Collateral.  (c) The Grantors shall not be liable to an indemnified party to the extent any liability  results from that indemnified party’s gross negligence or willful misconduct.   Payment by an indemnified party will not be a condition precedent to the  obligations of any Grantor under this indemnity.  (d) The obligations of the Grantors under this Clause 10 (Expenses and Indemnity)  are joint and several.  (e) This Clause survives the issuance of the Notes, the repayment of the Notes, any  transfer or assignment of the Notes and the termination of this Agreement.  11. EVIDENCE AND CALCULATIONS  In the absence of manifest error, the records of the Collateral Agent shall be conclusive  evidence of the existence and the amount of the Secured Liabilities.  12. CHANGES TO THE PARTIES  12.1 Grantors  The Grantors may not assign, delegate or transfer any of their respective rights or  obligations under this Agreement without the consent of the Collateral Agent, and any  purported assignment, delegation or transfer in violation of this provision shall be void  and of no effect.  12.2 Collateral Agent  The Collateral Agent may assign or transfer its rights and obligations under this  Agreement in the manner permitted under the Indenture.  12.3 Successors and assigns  This Agreement shall be binding on and inure to the benefit of the respective successors  and permitted assigns of the Grantors and the Collateral Agent.  

 

   21  13. MISCELLANEOUS  13.1 Amendments and waivers  Any term of this Agreement may be amended or waived only by the written agreement of  the Grantors and the Collateral Agent. Notwithstanding the foregoing, the Grantors may,  but shall have no obligation to, update the schedules hereto from time to time by  delivering such updated schedules to the Collateral Agent.  13.2 Waivers and remedies cumulative  (a) The rights and remedies of the Collateral Agent under this Agreement:  (i) may be exercised as often as necessary;  (ii) are cumulative and not exclusive of its rights under applicable law; and  (iii) may be waived only in writing and specifically.  (b) Delay in exercising, or non-exercise, of any right or remedy under this Agreement  is not a waiver of that right or remedy.  13.3 Counterparts  This Agreement may be executed in counterparts, and this has the same effect as if the  signatures on the counterparts were on a single copy of this Agreement.  The words  “execution,” “executed,” “signed,” “signature,” “delivery” and words of like import in or  relating to this Agreement or any document to be signed in connection with this  Agreement shall be deemed to include electronic signatures, deliveries or the keeping of  records in electronic form, each of which shall be of the same legal effect, validity or  enforceability as a manually executed signature, physical delivery thereof or the use of a  paper-based recordkeeping system, as the case may be, and the parties hereto consent to  conduct the transactions contemplated hereunder by electronic means.  14. SEVERABILITY  If any term of this Agreement is or becomes illegal, invalid or unenforceable in any  jurisdiction, that will not affect:  (a) the legality, validity or enforceability in that jurisdiction of any other term of this  Agreement; or  (b) the legality, validity or enforceability in any other jurisdiction of that or any other  term of this Agreement.  15. RELEASE  At the end of the Security Period and at the other times provided in the Indenture, the  Security will be released in accordance with the Indenture and the Collateral Agent must,  

 

   22  at the request and cost of the Grantors, promptly take whatever action is necessary to  release all or any applicable part of the Collateral from this Security in accordance with  the terms of the Indenture.  16. NOTICES  16.1 Notices  Any communication in connection with this Agreement must be in writing and, unless  otherwise stated, must be given in person, by first class mail (registered or certified,  return receipt requested), overnight courier guaranteeing next day delivery, or by fax.  16.2 Contact details  (a) The contact details of the Grantors for this purpose are:  Liggett Group LLC  Address: 100 Maple Lane    Mebane, NC  27302  Fax:  (919) 304-7700  Attention: Victoria Spier Evans     100 Maple LLC  Address: 3800 Paramount Parkway, Suite 250    P.O. Box 2010    Morrisville, NC 27560  Fax:  (919) 990-3505  Attention: Victoria Spier Evans      (b) The contact details of the Collateral Agent for this purpose are:   U.S. Bank National Association  Address: Global Corporate Trust Services    60 Livingston Avenue    EP-MN-WS3C    St. Paul, MN 55107-2292  Fax:  (651) 466-7430  Attention: Joshua A. Hahn    (c) Any party may change its contact details by giving five Business Days’ notice to  the other parties  (d) Where a party nominates a particular department or officer to receive a  communication, a communication will not be effective if it fails to specify that  department or officer.  16.3 Effectiveness  

 

   23  (a) Except as provided below, any communication in connection with this Agreement  will be deemed to be given as follows:  (i) if delivered in person, at the time of delivery;  (ii) if by e-mail or fax, when sent with confirmation of transmission.  (b) A communication given under this Clause but received on a non-working day or  after business hours in the place of receipt will only be deemed to be given on the  next working day in that place.  17. GOVERNING LAW  This Agreement, the relationship between the Grantors, the Secured Parties and any claim  or dispute (whether sounding in contract, tort, statute or otherwise) relating to this  Agreement or that relationship shall be governed by and construed in accordance with  law of the State of New York including section 5-1401 of the New York General  Obligations Law but excluding any other conflict of law rules that would lead to the  application of the law of another jurisdiction.  If the law of a jurisdiction other than New  York is, under section 1-105(2) of the UCC, mandatorily applicable to the perfection,  priority or enforcement of any security interest granted under this Agreement in respect  of any particular Collateral, that other law shall apply solely to the matters of perfection,  priority or enforcement to which it is mandatorily applicable.  18. ENFORCEMENT  18.1 Jurisdiction  (a) Each of the Parties agree that any New York State court or Federal court sitting in  the City and County of New York has jurisdiction to settle any disputes in  connection with this Agreement and accordingly submits to the jurisdiction of  those courts.  (b) Each of the Parties:  (i) waives objection to the New York State and Federal courts on grounds of  personal jurisdiction, inconvenient forum or otherwise as regards  proceedings in connection with this Agreement; and  (ii) agrees that a judgment or order of a New York State or Federal court in  connection with this Agreement is conclusive and binding on it and may  be enforced against it in the courts of any other jurisdiction.  (c) Nothing in this Clause limits the right of the Collateral Agent or any Noteholder  to bring proceedings against any Grantor in connection with this Agreement:  (i) in any other court of competent jurisdiction; or  

 

   24  (ii) concurrently in more than one jurisdiction.  18.2 Service of Process  Each Grantor consents to the service of process relating to any proceedings by a notice  given in accordance with Clause 16 (Notices) above.  18.3 Complete Agreement  This Agreement and the other Finance Documents contain the complete agreement  between the parties on the matters to which they relate and supersede all prior  commitments, agreements and understandings, whether written or oral, on those matters.  18.4 Waiver of Jury Trial  THE GRANTORS AND THE COLLATERAL AGENT (FOR ITSELF AND ON  BEHALF OF THE NOTEHOLDERS) WAIVE ANY RIGHTS THEY MAY HAVE TO  A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED ON OR ARISING  FROM THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS  AGREEMENT.  In the event of litigation, this Agreement may be filed as a written  consent to a trial by the court.  19. 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.  The undersigned, intending to be legally bound, have executed and delivered this Agreement on  the date stated at the beginning of this Agreement.  

 

    SIGNATORIES  IN WITNESS WHEREOF, the Grantors have caused this Security Agreement to be duly  executed by its duly authorized officer as of the day and year first above written.    Grantors    LIGGETT GROUP LLC    By: /s/ Nicholas P. Anson   Name: Nicholas P. Anson    Title: President and Chief Operating Officer      100 MAPLE LLC     By: /s/ Victoria Spier Evans   Name: Victoria Spier Evans      Title: Secretary   

 

   26  Collateral Agent  U.S. BANK NATIONAL ASSOCIATION  as Collateral Agent  By: /s/ Joshua A. Hahn  Name: Joshua A. Hahn  Title: Vice President                                      

 

   27  SCHEDULE 1    COMMERCIAL TORT CLAIMS    NONE.    

 

    SCHEDULE 2    INTELLECTUAL PROPERTY  COPYRIGHTS:    Registrations  Liggett Group LLC – None      100 Maple LLC - None.     Applications    Liggett Group LLC - None.  100 Maple LLC  - None.     PATENTS:    Registrations  Liggett Group LLC - None.  100 Maple LLC - None.     Applications    Liggett Group LLC - None.  100 Maple LLC - None.     TRADEMARKS:  Registrations  Liggett Group LLC -  Mark Owner  Appl. No.  Filing Date  Reg. No.  Reg. Date    Liggett Group LLC 78/526208  02-DEC-2004  3108068  20-JUN-2006    Liggett Group LLC 76/386980  26-MAR-2002  2815517  17-FEB 2004  

 

    Mark Owner  Appl. No.  Filing Date  Reg. No.  Reg. Date    Liggett Group LLC 74/259122  26-MAR-1992  1804692  16-NOV-1993    Liggett Group LLC 73/654465  10-APR-1987  1462175  20-OCT-1987    Liggett Group LLC 73/465819  15-FEB-1984  1327319  26-MAR-1985    Liggett Group LLC 73/465818  15-FEB-1984  1344930  25-JUN-1985    Liggett Group LLC 86/823504  7-NOV-2015  5257011  8/1/2017    Liggett Group LLC 87/524,162  07/11/2017  5,591,310  10/23/2018  BRONSON Liggett Group LLC 74/349010  15-JAN-1993  1821601  15-FEB-1994  EVE Liggett Group LLC 72/314239  11-DEC-1968  0872454  08-JUL-1969  GRAND PRIX Liggett Group LLC 73/641310  23-JAN-1987  1453454  18-AUG-1987  LIGGETT GROUP Liggett Group LLC 74/721242  28-AUG-1995  2023349  17-DEC-1996  LIGGETT SELECT Liggett Group LLC 76/533449  30-JUL-2003  2961769  14-JUN-2005  MONTEGO Liggett Group LLC 74/461169  22-NOV-1993  1900071  13-JUN-1995  

 

    Mark Owner  Appl. No.  Filing Date  Reg. No.  Reg. Date  PYRAMID Liggett Group LLC 73/366688  26-MAY-1982  1273822  10-APR-1984    100 Maple LLC - None.    Applications    Liggett Group LLC –   OWNER  APPLICATION  NUMBER TRADEMARK  Liggett Group LLC 88/887,251 GOOD TASTE COUNTS  Liggett Group LLC 88/606,245 RIGHT ON THE MONEY    100 Maple LLC - None.    

 

    EXHIBIT 1    FORM OF PATENT SECURITY AND PLEDGE AGREEMENT  This PATENT SECURITY AND PLEDGE AGREEMENT, dated as of  [            , 2021] (as may be amended, restated, amended and restated, supplemented or  otherwise modified from time to time, this “Agreement”), is made by [Liggett Group  LLC][100 Maple LLC           ], a Delaware limited liability company and (the “Grantor”)  in favor of U.S. Bank National Association, as collateral agent (in such capacity, the  “Collateral Agent”) for the Noteholders (as defined in the Security Agreement referred to  below).  WHEREAS, the Grantor has guaranteed the Notes issued under the Indenture,  dated as of January 28, 2021 (as amended, supplemented, or otherwise modified from  time to time, the “Indenture”) among Vector Group Ltd. (the “Issuer”), the Grantor and  certain of the Issuer’s other direct and indirect subsidiaries and the Collateral Agent, in its  capacity as trustee thereunder.  WHEREAS, it is a condition precedent to the obligations of the Collateral Agent  under the Indenture that the Grantor shall have executed and delivered that certain  Security Agreement, dated as of January 28, 2021, in favor of the Collateral Agent (as  amended, supplemented, replaced or otherwise modified from time to time, the “Security  Agreement”).  WHEREAS, under the terms of the Security Agreement, the Grantor has granted a  security interest in certain property, including certain Intellectual Property of such  Grantor to the Collateral Agent for the benefit of the Secured Parties, and has agreed as a  condition thereof to execute this Agreement for recording with the United States Patent  and Trademark Office and other applicable Governmental Authorities.  WHEREAS, this Agreement is supplemental to the provisions contained in the  Security Agreement and, in the event of an inconsistency among them, the Security  Agreement shall control over this Agreement.  NOW, THEREFORE, for good and valuable consideration, the receipt and  sufficiency of which are hereby acknowledged, the Grantor agrees as follows:  1. DEFINITIONS.  1.1 Terms Defined in the Security Agreement.  All capitalized terms used in this  Agreement and not otherwise defined herein shall have the meanings assigned to them in  the Security Agreement.  1.2 Certain Defined Terms.  As used in this Agreement, the following terms shall  have the following meanings:  “Assignment of Patents” has the meaning set forth in Section 2.2 herein.  

 

    “Patent Collateral” has the meaning set forth in Section 2.1 herein.  “PTO” means the United States Patent and Trademark Office.  1.3 Rules of Construction.  Unless otherwise provided herein, the rules of  construction set forth in Section 1.2 of the Security Agreement shall be applicable to this  Agreement.  2. GRANT OF SECURITY INTEREST.  2.1 Security Interest.  As collateral security for the payment and performance in full  of all of the Secured Liabilities, the Grantor hereby grants to the Collateral Agent, for the  benefit of the Secured Parties, a continuing security interest in and lien on all of the  Grantor’s right, title and interest in all Patents owned by such Grantor, including the  Patents referred to on Schedule A hereto (as such schedule may be amended or  supplemented from time to time), in each case whether now or hereafter existing or  arising or in which such Grantor now has or hereafter owns or acquires, all inventions  and improvements described therein, all rights to sue for past, present and future  infringements thereof, and all proceeds of the foregoing, including license fees, royalties,  income, payments, claims, damages, and proceeds of suit (collectively, the “Patent  Collateral”).    2.2 Assignment of Patents upon Default.  The Grantor acknowledges that the  Collateral Agent has the right, pursuant to the power of attorney granted the Collateral  Agent hereunder and under the Security Agreement, upon the occurrence and during the  continuance of an Event of Default, to execute on behalf of such Grantor an assignment  of Patents that constitute Patent Collateral (each an “Assignment of Patents”) for the sole  purpose of effecting the Collateral Agent’s exercise of its remedies under Section 8 of the  Security Agreement.  In furtherance of the foregoing, the Grantor hereby authorizes the  Collateral Agent to complete, execute and record with the PTO an Assignment of Patents  on behalf of such Grantor upon the occurrence and during the continuance of an Event of  Default for the sole purpose of effecting the Collateral Agent’s exercise of its remedies  under Section 8 of the Security Agreement.  2.3 Conditional Assignment.  In addition to, and not by way of limitation of, the grant  and pledge of the Patent Collateral provided in Section 2.1, the Grantor hereby grants,  assigns, transfers, conveys and sets over to the Collateral Agent, for the benefit of the  Secured Parties, the Grantor’s entire right, title and interest in and to the Patent  Collateral; provided, that such grant, assignment, transfer and conveyance shall be and  become of force and effect only (a) in connection with the Collateral Agent’s exercise of  its rights and remedies in strict accordance with the terms of the Security Agreement, and  (b) upon or after the occurrence and during the continuance of an Event of Default and  (c) either (i) upon the written demand of the Collateral Agent at any time during such  continuance or (ii) immediately and automatically (without notice or action of any kind  by the Collateral Agent) upon an Event of Default for which acceleration of the payment  of the Notes is automatic under the Indenture or upon the sale or other disposition of or  foreclosure upon the Collateral pursuant to the Security Agreement and applicable law  

 

    (including the transfer or other disposition of the Collateral by the Grantor to the  Collateral Agent or its nominee in lieu of foreclosure).  2.4 Security Agreement.  Pursuant to the Security Agreement the Grantor has granted  to the Collateral Agent, for the benefit of the Secured Parties, a continuing security  interest in and lien on the Collateral (including the Patent Collateral).  The Security  Agreement, and all rights and interests of the Collateral Agent in and to the Collateral  (including the Patent Collateral) thereunder, are hereby ratified and confirmed in all  respects, and the Grantor hereby acknowledges and affirms that the rights and remedies  of the Collateral Agent with respect to the security interest in the Patent Collateral  granted hereby are more fully set forth in the Security Agreement, the terms and  provisions of which are incorporated by reference herein as if fully set forth herein.  In no  event shall this Agreement, the grant, assignment, transfer and conveyance of the Patent  Collateral hereunder, or the recordation of this Agreement (or any other document  hereunder) with the PTO, adversely affect or impair, in any way or to any extent, the  Security Agreement, the security interest of the Collateral Agent in the Collateral  (including the Patent Collateral) pursuant to the Security Agreement, the attachment and  perfection of such security interest under the UCC (including the security interest in the  Patent Collateral), or any present or future rights and interests of the Collateral Agent in  and to the Collateral under or in connection with the Security Agreement or the UCC.  In  the event that any provision of this Agreement is deemed to conflict with the Security  Agreement, the provisions of the Security Agreement shall control.     3. AFTER-ACQUIRED PATENTS   3.1 After-acquired Patents.  If, after the execution of this Agreement and before the  end of the Security Period, the Grantor shall develop or acquire any new Patents, the  provisions of this Agreement shall automatically apply thereto.  3.2 Amendment to Schedule.  The Grantor authorizes the Collateral Agent to modify  this Agreement and the Assignments of Patents, without the necessity of the Grantor’s  further approval or signature, by amending Schedule A hereto and the Annex to each  Assignment of Patents to include any future or other Patents that become part of the  Patent Collateral under Section 2 or Section 3.1.  4. GOVERNING LAW; CONSENT TO JURISDICTION.   This Agreement, the relationship between the parties hereunder and any claim or  dispute (whether sounding in contract, tort, statute or otherwise) relating to this  Agreement or that relationship shall be governed by and construed in accordance with  law of the State of New York including section 5-1401 of the New York General  Obligations Law but excluding any other conflict of law rules that would lead to the  application of the law of another jurisdiction.  If the law of a jurisdiction other than New  York is, under section 1-105(2) of the UCC, mandatorily applicable to the perfection,  priority or enforcement of any security interest granted under this Agreement in respect  of any Patent Collateral, that other law shall apply solely to the matters of perfection,  priority or enforcement to which it is mandatorily applicable.    

 

    5. MISCELLANEOUS.   5.1 Headings.  The headings of each section of this Agreement are for convenience  only and shall not define or limit the provisions thereof.  This Agreement and all rights  and obligations hereunder shall be binding upon the Grantor and its respective successors  and assigns, and shall inure to the benefit of the Secured Parties and their respective  successors and assigns.  If any term of this Agreement shall be held to be invalid, illegal  or unenforceable, the validity of all other terms hereof shall in no way be affected  thereby, and this Agreement shall be construed and be enforceable as if such invalid,  illegal or unenforceable term had not been included herein.  The Grantor acknowledges  receipt of a copy of this Agreement.  5.2 Counterparts.  This Agreement may be executed in any number of counterparts,  each of which when so executed and delivered shall be deemed an original, but all such  counterparts together shall constitute but one and the same instrument.    [Signatures begin on next page]  

 

       IN WITNESS WHEREOF, the Grantor has caused this Patent Security and Pledge  Agreement to be executed and delivered by its duly authorized officer as of the day and year first  above written.    [                      ], as Grantor      By: ______________________________      Name:        Title:      U.S. Bank National Association, as Collateral  Agent      By:  ______________________________     Name:     Title:  

 

      Schedule A  to the Patent Security and Pledge Agreement    Grantor: [___]    Issued U.S. Patents of Grantor    Patent No. Issue Date Title                                        Pending U.S. Patent Applications of Grantor    Application No. Filing Date Title                                  

 

      EXHIBIT 2  FORM OF TRADEMARK SECURITY AND PLEDGE AGREEMENT  This TRADEMARK SECURITY AND PLEDGE AGREEMENT, dated as of  [            , 2021] (as may be amended, restated, amended and restated, supplemented or  otherwise modified from time to time, this “Agreement”), is made by [Liggett Group  LLC][100 Maple LLC], a Delaware limited liability company and (the “Grantor”) in  favor of U.S. Bank National Association, as collateral agent (in such capacity, the  “Collateral Agent”) for the Noteholders (as defined in the Security Agreement referred to  below).  WHEREAS, the Grantor has guaranteed the Notes issued under the Indenture,  dated as of January 28, 2021 (as amended, supplemented, or otherwise modified from  time to time, the “Indenture”) among Vector Group Ltd. (the “Issuer”), the Grantor and  certain of the Issuer’s other direct and indirect subsidiaries and the Collateral Agent, in its  capacity as trustee thereunder.    WHEREAS, it is a condition precedent to the obligations of the Collateral Agent  under the Indenture that the Grantor shall have executed and delivered that certain  Security Agreement, dated as of January 28, 2021, in favor of the Collateral Agent (as  amended, supplemented, replaced or otherwise modified from time to time, the “Security  Agreement”).  WHEREAS, under the terms of the Security Agreement, the Grantor has granted a  security interest in certain property, including certain Intellectual Property of the Grantor  to the Collateral Agent for the benefit of the Secured Parties, and has agreed as a  condition thereof to execute this Agreement for recording with the United States Patent  and Trademark Office and other applicable Governmental Authorities.  WHEREAS, this Agreement is supplemental to the provisions contained in the  Security Agreement and, in the event of an inconsistency among them, the Security  Agreement shall control over this Agreement.  NOW, THEREFORE, for good and valuable consideration, the receipt and  sufficiency of which are hereby acknowledged, the Grantor agrees as follows:  1. DEFINITIONS.  1.1 Terms Defined in the Security Agreement.  All capitalized terms used in this  Agreement and not otherwise defined herein shall have the meanings assigned to them in  the Security Agreement.  1.2 Certain Defined Terms.  As used in this Agreement, the following terms shall  have the following meanings:  “Assignment of Marks” has the meaning set forth in Section 2.2 herein.  

 

      “PTO” means the United States Patent and Trademark Office.  “Trademark Collateral” has the meaning set forth in Section 2.1 herein.  1.3 Rules of Construction.  Unless otherwise provided herein, the rules of  construction set forth in Section 1.2 of the Security Agreement shall be applicable to this  Agreement.  2. GRANT OF SECURITY INTEREST.  2.1 Security Interest.  As collateral security for the payment and performance in full  of all of the Secured Liabilities, the Grantor hereby pledges and grants to the Collateral  Agent, for the benefit of the Secured Parties, a continuing security interest in and lien on  all of the Grantor’s right, title and interest in all Trademarks owned by such Grantor,  including the Trademarks referred to on Schedule A hereto (as such schedule may be  amended or supplemented from time to time), in each case whether now or hereafter  existing or arising or in which such Grantor now has or hereafter owns or acquires, and  all rights to sue for past, present and future infringements or dilutions thereof, and all  proceeds of the foregoing, including license fees, royalties, income, payments, claims,  damages, and proceeds of suit (collectively, the “Trademark Collateral”).      2.2 Assignment of Trademarks upon Default.  The Grantor acknowledges that the  Collateral Agent has the right, pursuant to the power of attorney granted the Collateral  Agent hereunder and under the Security Agreement, upon the occurrence and during the  continuance of an Event of Default, to execute on behalf of such Grantor an assignment  of Trademarks that constitute Trademark Collateral (each an “Assignment of  Trademarks”) for the sole purpose of effecting the Collateral Agent’s exercise of its  remedies under Section 8 of the Security Agreement.  In furtherance of the foregoing, the  Grantor hereby authorizes the Collateral Agent to complete, execute and record with the  PTO an Assignment of Trademarks on behalf of such Grantor upon the occurrence and  during the continuance of an Event of Default for the sole purpose of effecting the  Collateral Agent’s exercise of its remedies under Section 8 of the Security Agreement.  2.3 Conditional Assignment.  In addition to, and not by way of limitation of, the grant  and pledge of the Trademark Collateral provided in Section 2.1, the Grantor hereby  grants, assigns, transfers, conveys and sets over to the Collateral Agent, for the benefit of  the Secured Parties, the Grantor’s entire right, title and interest in and to the Trademark  Collateral; provided, that such grant, assignment, transfer and conveyance shall be and  become of force and effect only (a) in connection with the Collateral Agent’s exercise of  its rights and remedies in strict accordance with the terms of the Security Agreement, and  (b) upon or after the occurrence and during the continuance of an Event of Default and  (c) either (i) upon the written demand of the Collateral Agent at any time during such  continuance or (ii) immediately and automatically (without notice or action of any kind  by the Collateral Agent) upon an Event of Default for which acceleration of the payment  of the Notes is automatic under the Indenture or upon the sale or other disposition of or  foreclosure upon the Collateral pursuant to the Security Agreement and applicable law  (including the transfer or other disposition of the Collateral by the Grantor to the  Collateral Agent or its nominee in lieu of foreclosure).  

 

      2.4 Security Agreement.  Pursuant to the Security Agreement the Grantor has granted  to the Collateral Agent, for the benefit of the Secured Parties, a continuing security  interest in and lien on the Collateral (including the Trademark Collateral).  The Security  Agreement, and all rights and interests of the Collateral Agent in and to the Collateral  (including the Trademark Collateral) thereunder, are hereby ratified and confirmed in all  respects, and the Grantor hereby acknowledges and affirms that the rights and remedies  of the Collateral Agent with respect to the security interest in the Trademark Collateral  granted hereby are more fully set forth in the Security Agreement, the terms and  provisions of which are incorporated by reference herein as if fully set forth herein.  In no  event shall this Agreement, the grant, assignment, transfer and conveyance of the  Trademark Collateral hereunder, or the recordation of this Agreement (or any other  document hereunder) with the PTO, adversely affect or impair, in any way or to any  extent, the Security Agreement, the security interest of the Collateral Agent in the  Collateral (including the Trademark Collateral) pursuant to the Security Agreement, the  attachment and perfection of such security interest under the UCC (including the security  interest in the Trademark Collateral), or any present or future rights and interests of the  Collateral Agent in and to the Collateral under or in connection with the Security  Agreement or the UCC.  In the event that any provision of this Agreement is deemed to  conflict with the Security Agreement, the provisions of the Security Agreement shall  control.  3. AFTER-ACQUIRED TRADEMARKS.   3.1 After-acquired Trademarks.  If, after the execution of the Agreement and before  the end of the Security Period, the Grantor shall develop or acquire any new Trademarks,  the provisions of this Agreement shall automatically apply thereto.  3.2 Amendment to Schedule.  The Grantor authorizes the Collateral Agent to modify  this Agreement and the Assignments of Trademarks, without the necessity of the  Grantor’s further approval or signature, by amending Schedule A hereto and the Annex to  each Assignment of Trademarks to include any future or other Trademarks that become  part of the Trademark Collateral under Section 2 or Section 3.1.  4. GOVERNING LAW; CONSENT TO JURISDICTION.   This Agreement, the relationship between the parties hereunder and any claim or  dispute (whether sounding in contract, tort, statute or otherwise) relating to this  Agreement or that relationship shall be governed by and construed in accordance with  law of the State of New York including section 5-1401 of the New York General  Obligations Law but excluding any other conflict of law rules that would lead to the  application of the law of another jurisdiction.  If the law of a jurisdiction other than New  York is, under section 1-105(2) of the UCC, mandatorily applicable to the perfection,  priority or enforcement of any security interest granted under this Agreement in respect  of any Trademark Collateral, that other law shall apply solely to the matters of perfection,  priority or enforcement to which it is mandatorily applicable.    5. MISCELLANEOUS.   

 

      (a) Headings.  The headings of each section of this Agreement are for  convenience only and shall not define or limit the provisions thereof.  This  Agreement and all rights and obligations hereunder shall be binding upon  the Grantor and its respective successors and assigns, and shall inure to the  benefit of the Secured Parties and their respective successors and assigns.   If any term of this Agreement shall be held to be invalid, illegal or  unenforceable, the validity of all other terms hereof shall in no way be  affected thereby, and this Agreement shall be construed and be enforceable  as if such invalid, illegal or unenforceable term had not been included  herein.  The Grantor acknowledges receipt of a copy of this Agreement.  (b) Counterparts.  This Agreement may be executed in any number of  counterparts, each of which when so executed and delivered shall be  deemed an original, but all such counterparts together shall constitute but  one and the same instrument.    [Signatures begin on next page]  

 

     IN WITNESS WHEREOF, the Grantor has caused this Trademark Security and Pledge  Agreement to be executed and delivered by its duly authorized officer as of the day and year first  above written.      [                             ], as Grantor      By: ______________________________      Name:        Title:         U.S. Bank National Association, as Collateral  Agent      By:    _______________________________      Name:        Title:   

 

      Schedule A  to the Trademark Security and Pledge Agreement    Grantor: [                        ]    United States Trademark Registrations of [_______]    Trademark  Registration No./  Application No.  Registration Date/  Application Date                                                                                                                                  

 

    EXHIBIT 3  FORM OF COPYRIGHT SECURITY AGREEMENT  This COPYRIGHT SECURITY AGREEMENT, dated as of [            , 2021]  (as may be amended, restated, amended and restated, supplemented or otherwise  modified from time to time, this “Agreement”), is made by [Liggett Group LLC][100  Maple LLC] a Delaware limited liability company (the “Grantor”) in favor of U.S. Bank  National Association, as collateral agent (in such capacity, the “Collateral Agent”) for  the Noteholders (as defined in the Security Agreement referred to below).  WHEREAS, the Grantor has guaranteed the Notes issued under the Indenture,  dated as of January 28, 2021 (as amended, supplemented, or otherwise modified from  time to time, the “Indenture”) among Vector Group Ltd. (the “Issuer”), the Grantor and  certain of the Issuer’s other direct and indirect subsidiaries and the Collateral Agent, in its  capacity as trustee thereunder.    WHEREAS, it is a condition precedent to the obligations of the Collateral Agent  under the Indenture that the Grantor shall have executed and delivered that certain  Security Agreement, dated as of January 28, 2021, in favor of the Collateral Agent (as  amended, supplemented, replaced or otherwise modified from time to time, the “Security  Agreement”).  WHEREAS, under the terms of the Security Agreement, the Grantor has granted a  security interest in certain property, including certain Intellectual Property of the Grantor  to the Collateral Agent for the benefit of the Secured Parties, and has agreed as a  condition thereof to execute this Agreement for recording with the United States  Copyright Office and other applicable Governmental Authorities.  WHEREAS, this Agreement is supplemental to the provisions contained in the  Security Agreement and, in the event of an inconsistency among them, the Security  Agreement shall control over this Agreement.  NOW, THEREFORE, for good and valuable consideration, the receipt and  sufficiency of which are hereby acknowledged, the Grantor agrees as follows:  1. DEFINITIONS  1.1 Terms Defined in the Security Agreement.  All capitalized terms used in this  Agreement and not otherwise defined herein shall have the meanings assigned to them in  the Security Agreement.  1.2 Certain Defined Terms.  As used in this Agreement, the following terms shall  have the following meanings:  “Assignment of Copyrights” has the meaning set forth in Section 2.2 herein.  “Copyright Collateral” has the meaning set forth in Section 2.1 herein.  

 

     1.3 Rules of Construction.  Unless otherwise provided herein, the rules of  construction set forth in Section 1.2 of the Security Agreement shall be applicable to this  Agreement.  2. GRANT OF SECURITY INTEREST   2.1 Security Interest.  As collateral security for the payment and performance in full  of all of the Secured Liabilities, the Grantor hereby pledges and grants to the Collateral  Agent, for the benefit of the Secured Parties, a continuing security interest in and lien on  all of the Grantor’s right, title and interest in, to and under the Copyrights and Copyright  Licenses, including the Copyrights and exclusive Copyright Licenses referred to on  Schedule I hereto (as such schedule may be amended or supplemented from time to  time), in each case whether presently existing or hereafter created or acquired, and all  rights to sue for past, present and future infringements thereof, and all proceeds of the  foregoing, including license fees, royalties, income, payments, claims, damages, and  proceeds of suit (collectively, the “Copyright Collateral”).  2.2 Assignment of Copyrights upon Default.  The Grantor acknowledges that the  Collateral Agent has the right, pursuant to the power of attorney granted the Collateral  Agent hereunder and under the Security Agreement, upon the occurrence and during the  continuance of an Event of Default, to execute on behalf of such Grantor an assignment  of Copyrights and Copyright Licenses that constitute Copyright Collateral (each an  “Assignment of Copyrights”) for the sole purpose of effecting the Collateral Agent’s  exercise of its remedies under Section 8 of the Security Agreement.  In furtherance of the  foregoing, the Grantor hereby authorizes the Collateral Agent to complete, execute and  record with the United States Copyright Office an Assignment of Copyrights on behalf of  such Grantor upon the occurrence and during the continuance of an Event of Default for  the sole purpose of effecting the Collateral Agent’s exercise of its remedies under Section  8 of the Security Agreement.  2.3 Conditional Assignment.  In addition to, and not by way of limitation of, the grant  and pledge of the Copyright Collateral provided in Section 2.1, the Grantor hereby grants,  assigns, transfers, conveys and sets over to the Collateral Agent, for the benefit of the  Secured Parties, the Grantor’s entire right, title and interest in and to the Copyright  Collateral; provided, that such grant, assignment, transfer and conveyance shall be and  become of force and effect only (a) in connection with the Collateral Agent’s exercise of  its rights and remedies in strict accordance with the terms of the Security Agreement, and  (b) upon or after the occurrence and during the continuance of an Event of Default and  (c) either (i) upon the written demand of the Collateral Agent at any time during such  continuance or (ii) immediately and automatically (without notice or action of any kind  by the Collateral Agent) upon an Event of Default for which acceleration of the payment  of the Notes is automatic under the Indenture or upon the sale or other disposition of or  foreclosure upon the Collateral pursuant to the Security Agreement and applicable law  (including the transfer or other disposition of the Collateral by the Grantor to the  Collateral Agent or its nominee in lieu of foreclosure).   2.4 Security Agreement.  Pursuant to the Security Agreement the Grantor has granted  to the Collateral Agent, for the benefit of the Secured Parties, a continuing security  interest in and lien on the Collateral (including the Copyright Collateral).  The Security  

 

     Agreement, and all rights and interests of the Collateral Agent in and to the Collateral  (including the Copyright Collateral) thereunder, are hereby ratified and confirmed in all  respects, and the Grantor hereby acknowledges and affirms that the rights and remedies  of the Collateral Agent with respect to the security interest in the Copyright Collateral  granted hereby are more fully set forth in the Security Agreement, the terms and  provisions of which are incorporated by reference herein as if fully set forth herein.  In no  event shall this Agreement, the grant, assignment, transfer and conveyance of the  Copyright Collateral hereunder, or the recordation of this Agreement (or any other  document hereunder) with the United States Copyright Office, adversely affect or impair,  in any way or to any extent, the Security Agreement, the security interest of the Collateral  Agent in the Collateral (including the Copyright Collateral) pursuant to the Security  Agreement, the attachment and perfection of such security interest under the UCC  (including the security interest in the Copyright Collateral), or any present or future rights  and interests of the Collateral Agent in and to the Collateral under or in connection with  the Security Agreement or the UCC.  In the event that any provision of this Agreement is  deemed to conflict with the Security Agreement, the provisions of the Security  Agreement shall control.  3. AFTER-ACQUIRED COPYRIGHTS  3.1 After-Acquired Copyrights.  If, after the execution of the Agreement and before  the end of the Security Period, the Grantor shall develop or acquire any new Copyrights  or Copyright Licenses, the provisions of this Agreement shall automatically apply  thereto.  3.2 Amendment to Schedule.  The Grantor authorizes the Collateral Agent to modify  this Agreement and the Assignment of Copyrights, without the necessity of the Grantor’s  further approval or signature, by amending Schedule I hereto and the Annex to each  Assignment of Copyrights and to include any future or other Copyrights or Copyright  Licenses that become part of the Copyright Collateral under Section 2 or Section 3.1.  4. GOVERNING LAW; CONSENT TO JURISDICTION  This Agreement, the relationship between the parties hereunder and any claim or  dispute (whether sounding in contract, tort, statute or otherwise) relating to this  Agreement or that relationship shall be governed by and construed in accordance with  law of the State of New York including section 5-1401 of the New York General  Obligations Law but excluding any other conflict of law rules that would lead to the  application of the law of another jurisdiction.  If the law of a jurisdiction other than New  York is, under section 1-105(2) of the UCC, mandatorily applicable to the perfection,  priority or enforcement of any security interest granted under this Agreement in respect  of any Copyright Collateral, that other law shall apply solely to the matters of perfection,  priority or enforcement to which it is mandatorily applicable.  5. MISCELLANEOUS.   5.1 Headings.  The headings of each section of this Agreement are for convenience  only and shall not define or limit the provisions thereof.  This Agreement and all rights  and obligations hereunder shall be binding upon the Grantor and its respective successors  

 

     and assigns, and shall inure to the benefit of the Secured Parties and their respective  successors and assigns.  If any term of this Agreement shall be held to be invalid, illegal  or unenforceable, the validity of all other terms hereof shall in no way be affected  thereby, and this Agreement shall be construed and be enforceable as if such invalid,  illegal or unenforceable term had not been included herein.  The Grantor acknowledges  receipt of a copy of this Agreement.  5.2 Counterparts.  This Agreement may be executed in any number of counterparts,  each of which when so executed and delivered shall be deemed an original, but all such  counterparts together shall constitute but one and the same instrument.    [Signatures begin on next page]  

 

    IN WITNESS WHEREOF, the Grantor has caused this Copyright Security  Agreement to be executed and delivered by its duly authorized officer as of the date first  set forth above.  [                             ],  as Grantor      By:   Name:   Title:          U.S. Bank National Association,  as Collateral Agent      By:   Name:   Title:  

 

       SCHEDULE I  to  COPYRIGHT SECURITY AGREEMENT  COPYRIGHT REGISTRATIONS AND APPLICATIONS  Registrations  Registration No. Registration Date Title        Applications  Application No. Application Date Titleex45vector2021notes-arin

Exhibit 4.5  SECOND AMENDED AND RESTATED INTERCREDITOR AND LIEN SUBORDINATION  AGREEMENT  among  WELLS FARGO BANK, NATIONAL ASSOCIATION,  as ABL Agent   and  U.S. BANK NATIONAL ASSOCIATION,  as Collateral Agent  and   LIGGETT GROUP LLC,  as an Initial Borrower  and  100 MAPLE LLC,  as an Initial Borrower  and   The Other Borrowers from time to time party hereto  

 

-i-  TABLE OF CONTENTS  Page  Section 1. DEFINITIONS; INTERPRETATION. ...................................................................... 1  1.1 Definitions ............................................................................................................................... 1  1.2 Terms Generally ...................................................................................................................... 6  Section 2. LIEN PRIORITIES ...................................................................................................... 6  2.1 Subordination .......................................................................................................................... 6  2.2 Prohibition on Contesting Liens ............................................................................................. 7  2.3 No New Liens ......................................................................................................................... 7  2.4 Cooperation ............................................................................................................................. 8  Section 3. ENFORCEMENT ......................................................................................................... 8  3.1 Exercise of Rights and Remedies ............................................................................................ 8  3.2 Rights As Unsecured Creditors ............................................................................................... 9  3.3 Release of Liens on ABL Collateral ..................................................................................... 10  3.4 Insurance and Condemnation Awards .................................................................................. 11  Section 4. PAYMENTS ................................................................................................................ 12  4.1 Application of Proceeds ........................................................................................................ 12  4.2 Payments Over ...................................................................................................................... 12  Section 5. BAILEE FOR PERFECTION ................................................................................... 13  5.1 Each Lender as Bailee ........................................................................................................... 13  5.2 Transfer of Pledged ABL Collateral ..................................................................................... 13  Section 6. INSOLVENCY OR LIQUIDATION PROCEEDINGS .......................................... 13  6.1 General Applicability ............................................................................................................ 13  6.2 Bankruptcy Financing ........................................................................................................... 14  6.3 Relief from the Automatic Stay ............................................................................................ 14  6.4 Adequate Protection .............................................................................................................. 15  6.5 Reorganization Securities ..................................................................................................... 15  6.6 Separate Classes .................................................................................................................... 15  6.7 Asset Dispositions ................................................................................................................. 15  6.8 Preference Issues ................................................................................................................... 16  6.9 Certain Waivers as to Section 1111(b)(2) of Bankruptcy Code............................................ 16  6.10 Other Bankruptcy Laws ........................................................................................................ 16  Section 7. NOTEHOLDER SECURED PARTIES’ PURCHASE OPTION .......................... 16  7.1 Exercise of Option ................................................................................................................ 16  7.2 Purchase and Sale ................................................................................................................. 16  7.3 Payment of Purchase Price .................................................................................................... 17  7.4 Representations Upon Purchase and Sale ............................................................................. 17  7.5 Notice from ABL Agent Prior to Lien Enforcement Action ................................................. 17  Section 8. RELIANCE; WAIVERS; ETC ................................................................................. 17  

 

-ii-  8.1 Reliance................................................................................................................................. 17  8.2 No Warranties or Liability .................................................................................................... 17  8.3 No Waiver of Lien Priorities ................................................................................................. 18  Section 9. JOINDER .................................................................................................................... 19  9.1 Joinder of Other Borrowers................................................................................................... 19  Section 10. MISCELLANEOUS ................................................................................................... 19  10.1 Conflicts; Additional Security .............................................................................................. 19  10.2 Continuing Nature of this Intercreditor Agreement; Severability ......................................... 19  10.3 When Discharge of ABL Debt and Discharge of Priority Noteholder Debt Deemed to Not  Have Occurred .................................................................................................................................. 20  10.4 Amendments to Noteholder Documents ............................................................................... 20  10.5 Amendments; Waivers .......................................................................................................... 20  10.6 Subrogation; Marshalling ...................................................................................................... 20  10.7 Consent to Jurisdiction; Waivers .......................................................................................... 21  10.8 Notices .................................................................................................................................. 21  10.9 Further Assurances ................................................................................................................ 22  10.10 Consent to Jurisdiction; Waiver of Jury Trial ................................................................... 22  10.11 Governing Law ................................................................................................................. 22  10.12 Binding on Successors and Assigns .................................................................................. 22  10.13 Specific Performance ........................................................................................................ 22  10.14 Section Titles; Time Periods ............................................................................................. 23  10.15 Counterparts ...................................................................................................................... 23  10.16 Authorization .................................................................................................................... 23  10.17 No Third Party Beneficiaries ............................................................................................ 23      

 

-1-  SECOND AMENDED AND RESTATED INTERCREDITOR AND LIEN SUBORDINATION  AGREEMENT  SECOND AMENDED AND RESTATED INTERCREDITOR AND LIEN SUBORDINATION  AGREEMENT, dated as of January 28, 2021 (this “Intercreditor Agreement” as hereinafter further defined),  among Wells Fargo Bank, National Association, in its capacity as administrative agent (in such capacity, the  “ABL Agent” as hereinafter further defined), for itself and on behalf of the other ABL Secured Parties (as  hereinafter defined), U.S. Bank National Association, in its capacity as collateral agent for the Noteholder  Secured Parties (in such capacity, the “Collateral Agent” as hereinafter further defined), Liggett Group LLC, a  Delaware limited liability company (“Liggett Group”), and 100 Maple LLC, a Delaware limited liability  company (“100 Maple” and, together with Liggett Group, the “Initial Borrowers”) and each other borrower  under the ABL Loan Agreement from time to time that becomes party hereto pursuant to a Joinder Agreement  (each, an “Other Borrower” and, together with the Initial Borrowers, the “Borrowers” and each individually, a  “Borrower”).  WITNESSETH:  WHEREAS, the Initial Borrowers have entered into a secured credit facility with the ABL Agent and the  ABL Lenders (as hereinafter defined) as set forth in the ABL Loan Agreement (as hereinafter defined) pursuant  to which the ABL Lenders have made and from time to time may make loans and provide other financial  accommodations to the Initial Borrowers and secured by the ABL Collateral (as hereinafter defined);  WHEREAS, the parties hereto have previously entered into an Amended and Restated Intercreditor and  Lien Subordination Agreement, dated as of January 27, 2017 (the “Existing Intercreditor Agreement”), by and  among the ABL Agent, in its capacity as ABL Lender (as defined in the Existing Intercreditor Agreement) (in  such capacity, the “Prior ABL Agent”), U.S. Bank National Association, in its capacity as collateral agent for  the Noteholder Secured Parties (as defined in the Existing Intercreditor Agreement) (in such capacity, the “Prior  Collateral Agent”), and the Initial Borrowers, in connection with the issuance by Vector Group Ltd. (the  “Issuer”) of a series of 6.125% Senior Secured Notes due 2025 (the “Existing Notes”);  WHEREAS, pursuant to the Noteholder Agreement (as hereinafter defined), the Issuer intends to issue  5.75% Senior Secured Notes due 2029 (including any additional notes issued pursuant to the Noteholder  Agreement), in an initial aggregate principal amount of $875 million, which will be guaranteed by the Initial  Borrowers and certain other direct and indirect subsidiaries of the Issuer and secured by certain security interests  in, and pledges of, certain assets and properties, including assets and properties of the Indenture Loan Parties (as  hereinafter defined), the proceeds of which will be used, among other things, to repay the entire outstanding  principal amount of the Existing Notes;  WHEREAS, the ABL Agent, on its own behalf and on behalf of the other ABL Secured Parties, and  the Collateral Agent, on its own behalf and on behalf of the Noteholder Secured Parties, desire to amend and  restate the Existing Intercreditor Agreement and enter into this Intercreditor Agreement to (i) confirm the  relative priority of the security interests of the ABL Secured Parties and the Noteholder Secured Parties in the  ABL Collateral, (ii) provide for the orderly sharing among them, in accordance with such priorities, of proceeds  of such ABL Collateral upon any foreclosure thereon or other disposition thereof, (iii) replace the Prior ABL  Agent with the ABL Agent and the Prior Collateral Agent with the Collateral Agent and (iv) address related  matters;  NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and obligations herein  set forth and for other good and valuable consideration, the sufficiency and receipt of which are hereby  acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:  Section 1. DEFINITIONS; INTERPRETATION.  1.1 Definitions. As used in this Intercreditor Agreement, the following terms have the meanings specified  below:  “100 Maple” shall have the meaning set forth in the preamble hereto.  “ABL Agent” shall mean Wells Fargo Bank, National Association in its capacity as administrative and  collateral agent under the ABL Loan Agreement, and also includes any successor, replacement or agent acting on  

 

-2-  its behalf as ABL Agent for the ABL Secured Parties under the ABL Documents.  “ABL Collateral” shall mean any and all of the assets and property of any Borrower in which both the  ABL Secured Parties and the Noteholder Secured Parties (or their respective agents) hold a security interest  (including assets and property that, but for the application of Section 552 of the Bankruptcy Code (or any  similar provision of any Bankruptcy Laws) would be ABL Collateral).  “ABL Debt” shall mean all “Obligations” as such term is defined in the ABL Loan Agreement,  including obligations, liabilities and indebtedness of every kind, nature and description owing by any Borrower  to any ABL Secured Party, including principal, interest, charges, fees, premiums, indemnities and expenses,  however evidenced, whether as principal, surety, endorser, guarantor or otherwise, arising under any of the ABL  Documents, whether now existing or hereafter arising, whether arising before, during or after the initial or any  renewal term of the ABL Documents or after the commencement of any case with respect to any Borrower  under the Bankruptcy Code or any other Insolvency or Liquidation Proceeding (and including any principal,  interest, fees, costs, expenses and other amounts, which would accrue and become due but for the  commencement of such case, whether or not such amounts are allowed or allowable in whole or in part in such  case or similar proceeding), whether direct or indirect, absolute or contingent, joint or several, due or not due,  primary or secondary, liquidated or unliquidated, secured or unsecured.  “ABL Documents” shall mean, collectively, the ABL Loan Agreement and all agreements, documents  and instruments at any time executed and/or delivered by any Borrower to, with or in favor of any ABL Secured  Party in connection therewith, as all of the foregoing now exist or may hereafter be amended, modified,  supplemented, extended, renewed, restated, refinanced, replaced or restructured (in whole or in part and  including any agreements with, to or in favor of any other lender or group of lenders that at any time refinances,  replaces or succeeds to all or any portion of the ABL Debt) in accordance with the terms of this Intercreditor  Agreement.  “ABL Event of Default” shall mean any “Event of Default” as defined in the ABL Loan Agreement.  “ABL Lenders” shall mean, collectively, Wells Fargo Bank, National Association, and any other lender  or group of lenders that at any time refinances, replaces or succeeds to all or any portion of the ABL Debt or is  otherwise party to the ABL Documents as a lender in accordance with the terms of this Intercreditor Agreement.  “ABL Loan Agreement” shall mean the Third Amended and Restated Credit Agreement, dated as of  January 14, 2015, by and among the Initial Borrowers, the ABL Agent and the other ABL Secured Parties from  time to time party thereto, as the same now exists or may hereafter be amended, modified, supplemented, extended,  renewed, restated, refinanced, replaced or restructured in accordance with the terms of this Intercreditor  Agreement (including by including an Other Borrower as a borrower thereunder).  “ABL Secured Parties” shall mean, collectively, (a) the ABL Agent, (b) the ABL Lenders, (c) the  issuing bank or banks of letters of credit or similar instruments under the ABL Loan Agreement, (d) each other  person to whom any of the ABL Debt (including ABL Debt constituting Bank Product Obligations) is owed and  (e) the successors, replacements and assigns of each of the foregoing; sometimes being referred to herein  individually as an “ABL Secured Party”.  “Agent” shall have the meaning set forth in Section 5.1(a).  “Bank Product Obligations” shall mean Cash Management Obligations and Hedging Obligations.  “Bankruptcy Code” shall mean the United States Bankruptcy Code, being Title 11 of the United States  Code, as the same now exists or may from time to time hereafter be amended, modified, recodified or  supplemented.  “Bankruptcy Law” shall mean the Bankruptcy Code and any similar Federal, state or foreign law for  the relief of debtors.  “Borrowers” and “Borrower” shall have the meaning set forth in the preamble hereto.  “Business Day” shall mean any day other than a Saturday, a Sunday or a day that is a legal holiday  under the laws of the State of New York or on which banking institutions in the State of New York are required  

 

-3-  or authorized by law or other governmental action to close.  “Carve Out” shall mean, in connection with any Insolvency or Liquidation Proceeding, any carve out  amount granted with respect to professional fees and expenses, court costs, filing fees, and fees and costs of the  Office of the United States Trustee as granted by the court or as agreed to by the ABL Agent in its reasonable  discretion.  “Cash Management Obligations” shall mean, with respect to any Borrower, the obligations of such  Borrower in connection with (a) credit cards or (b) cash management or related services, including (i) the  automated clearinghouse transfer of funds or overdrafts or (ii) controlled disbursement services.  “Collateral Agent” shall mean U.S. Bank National Association, in its capacity as Collateral Agent  under the Noteholder Documents, and also includes any successor, replacement or agent acting on its behalf as  Collateral Agent for the Noteholder Secured Parties under the Noteholder Documents.  “DIP Financing” shall have the meaning set forth in Section 6.2.  “Discharge of ABL Debt” shall mean (a) the termination or expiration of the commitments of the ABL  Lenders and the financing arrangements provided by the ABL Lenders to the Borrowers under the ABL  Documents, (b) except to the extent otherwise provided in Sections 4.1 and 4.2, the payment in full in cash of  the ABL Debt (other than (i) the ABL Debt described in clause (c) of this definition, (ii) contingent  indemnification obligations as to which no claim has been made and (iii) obligations under agreements with  ABL Secured Parties which continue notwithstanding the termination of the commitments and repayment of the  ABL Debt described herein), and (c) payment in full in cash of cash collateral, or at the applicable ABL Secured  Party’s option, the delivery to such ABL Secured Party of a letter of credit payable to such ABL Secured Party,  in either case as required under the terms of the ABL Loan Agreement, in respect of letters of credit issued  under the ABL Documents and Bank Product Obligations.  “Discharge of Priority Noteholder Debt” shall mean, except to the extent otherwise provided in  Sections 4.1 and 4.2, the final payment in full in cash of the Noteholder Debt.  “Discharge of Priority Debt” shall mean except to the extent otherwise provided in Sections 4.1 and  4.2, the final payment in full in cash of the First Priority Debt (other than as described in the definition of  Discharge of ABL Debt).  “Excess ABL Debt” shall mean ABL Debt which does not constitute First Priority Debt.  “Existing Intercreditor Agreement” shall have the meaning set forth in the recitals hereto.  “Existing Notes” shall have the meaning set forth in the recitals hereto.  “First Priority Debt” shall mean ABL Debt to the extent it does not exceed the Maximum Priority ABL  Debt Amount.  “Hedging Obligations” shall mean, with respect to any Person, the obligations of such Person under (a)  interest rate swap agreements, interest rate cap agreements and interest rate collar agreements and (b) other  agreements or arrangements designed to protect such Person against fluctuations in interest rates or the value of  foreign currencies.  “Indenture Loan Parties” shall mean the Issuer and those of its direct and indirect subsidiaries  (including the Borrowers) party to the Noteholder Agreement.  “Initial Borrowers” shall have the meaning set forth in the preamble hereto.  “Insolvency or Liquidation Proceeding” shall mean (a) any voluntary or involuntary case or proceeding  under any Bankruptcy Law with respect to any Borrower, (b) any other voluntary or involuntary insolvency,  reorganization or bankruptcy case or proceeding, or any receivership, liquidation, reorganization or other similar  case or proceeding with respect to any Borrower or with respect to any of their respective assets, (c) any  proceeding seeking the appointment of any trustee, receiver, liquidator, custodian or other insolvency official  with similar powers with respect to such Person or any or all of its assets or properties, (d) any liquidation,  

 

-4-  dissolution, reorganization or winding up of any Borrower whether voluntary or involuntary and whether or not  involving insolvency or bankruptcy or (e) any assignment for the benefit of creditors or any other marshalling of  assets and liabilities of any Borrower.  “Intercreditor Agreement” shall mean this Intercreditor and Lien Subordination Agreement, as  amended, modified, supplemented, extended, renewed, restated or replaced from time to time in accordance  with the terms hereof.  “Issuer” shall have the meaning set forth in the recitals hereto.  “Joinder Agreement” means a joinder agreement substantially in the form attached hereto as Exhibit A.  “Lien” shall mean any mortgage, deed of trust, pledge, hypothecation, assignment, deposit  arrangement, security interest, encumbrance (including, but not limited to, easements, rights of way and the  like), lien (statutory or other), security agreement or transfer intended as security, including any conditional sale  or other title retention agreement, the interest of a lessor under a capital lease or any financing lease having  substantially the same economic effect as any of the foregoing.  “Lien Enforcement Action” shall mean (a) any action by any Secured Party to foreclose on the Lien of  such Person in all or a material portion of the ABL Collateral or exercise any right of repossession, levy,  attachment, setoff or liquidation against all or a material portion of the ABL Collateral, (b) any action by any  Secured Party to take possession of, sell or otherwise realize (judicially or non-judicially) upon all or a material  portion of the ABL Collateral (including by setoff), (c) any action by any Secured Party to facilitate the  possession of, sale of or realization upon all or a material portion of the ABL Collateral including the  solicitation of bids from third parties to conduct the liquidation of all or any material portion of the ABL  Collateral, the engagement or retention of sales brokers, marketing agents, investment bankers, accountants,  auctioneers or other third parties for the purpose of valuing, marketing, promoting or selling all or any material  portion of the ABL Collateral, (d) the commencement by any Secured Party of any legal proceedings against or  with respect to all or a material portion of the ABL Collateral to facilitate the actions described in (a) through (c)  above, or (e) any action to seek or request relief from or modification of the automatic stay or any other stay in  any Insolvency or Liquidation Proceeding in respect of all or a material portion of the ABL Collateral, or any  proceeds thereof. For the purposes hereof, (i) the notification of account debtors to make payments to the ABL  Agent or any ABL Lender shall constitute a Lien Enforcement Action if and only if such action is coupled with  an action to take possession of all or a material portion of the ABL Collateral or the commencement of any legal  proceedings or actions against or with respect to the Borrowers of all or a material portion of the ABL  Collateral, and (ii) a material portion of the ABL Collateral shall mean ABL Collateral having a value in excess  of $10,000,000.  “Liggett Group” shall have the meaning set forth in the preamble hereto.  “Maximum Priority ABL Debt Amount” shall mean the sum of (a) the principal amount of the ABL  Debt (including undrawn amounts under any letters of credit issued under the ABL Documents) up to  $100,000,000 at any time outstanding, plus (b) any interest on the amount set forth in clause (a) (and including  any interest which would accrue and become due but for the commencement of Insolvency or Liquidation  Proceeding, whether or not such amounts are allowed or allowable in whole or in part in such case or similar  proceeding), plus (c) the Maximum Priority Cash Management Obligations, plus (d) the Maximum Priority  Hedging Obligations, plus (e) any fees, costs, expenses and indemnities payable under any of the ABL  Documents (and including any fees, costs, expenses and indemnities which would accrue and become due but  for the commencement of Insolvency or Liquidation Proceeding, whether or not such amounts are allowed or  allowable in whole or in part in such case or similar proceeding) minus (f) the amount of all permanent  reductions in the commitments under the ABL Documents and minus (g) the amount of all permanent  repayments of ABL Debt to the extent such repayments result in a reduction of the commitments under the ABL  Documents; provided that the Maximum Priority ABL Debt Amount shall be calculated without regard to the  amount of Carve Out.  “Maximum Priority Cash Management Obligations” shall mean, as of any date of determination, the  amount of the ABL Debt constituting Cash Management Obligations outstanding on such date, up to  $10,000,000 in the aggregate at any one time outstanding.  “Maximum Priority Hedging Obligations” shall mean, as of any date of determination, the amount of  

 

-5-  the ABL Debt constituting Hedging Obligations outstanding on such date, up to $10,000,000 in the aggregate at  any one time outstanding.  “Noteholder Agreement” shall mean the Indenture, dated as of January 28, 2021, by and among the  Issuer, the Indenture Loan Parties and the Noteholder Trustee, as the same now exists or may hereafter be  amended, modified, supplemented, extended, renewed, restated, refinanced, replaced or restructured.  “Noteholder Debt” shall mean all “Obligations” as such term is defined in the Noteholder Agreement,  including obligations, liabilities and indebtedness of every kind, nature and description owing by any Indenture  Loan Party to any Noteholder Secured Party, including principal, interest, charges, fees, premiums, indemnities  and expenses, however evidenced, whether as principal, surety, endorser, guarantor or otherwise, arising under  any of the Noteholder Documents, whether now existing or hereafter arising, whether arising before, during or  after the initial or any renewal term of the Noteholder Documents or after the commencement of any case with  respect to any Indenture Loan Party under the Bankruptcy Code or any other Insolvency or Liquidation  Proceeding (and including any principal, interest, fees, costs, expenses and other amounts, which would accrue  and become due but for the commencement of such case, whether or not such amounts are allowed or allowable  in whole or in part in such case or similar proceeding), whether direct or indirect, absolute or contingent, joint or  several, due or not due, primary or secondary, liquidated or unliquidated, secured or unsecured.  “Noteholder Default” shall mean any “Event of Default” as defined in the Noteholder Agreement.  “Noteholder Documents” shall mean, collectively, the Noteholder Agreement and all agreements,  documents and instruments at any time executed and/or delivered by any Indenture Loan Party to, with or in  favor of any Noteholder Secured Party in connection therewith, as all of the foregoing now exist or may  hereafter be amended, modified, supplemented, extended, renewed, restated, refinanced, replaced or restructured  (in whole or in part and including any agreements with, to or in favor of any other lender or group of lenders  that at any time refinances, replaces or succeeds to all or any portion of the Noteholder Debt).  “Noteholder Exclusive Assets” shall have the meaning set forth in Section 2.3(b).  “Noteholder Secured Parties” shall mean, collectively, (a) the Noteholder Trustee, solely in its capacity  as trustee under the Noteholder Agreement and the other Noteholder Documents, (b) each holder of any Note or  Notes, solely in its capacity as such holder, and each other person to whom any of the Noteholder Debt is  transferred or owed, solely in its capacity as such, (c) the Collateral Agent, and (d) the successors, replacements  and assigns of each of the foregoing; sometimes being referred to herein individually as a “Noteholder Secured  Party”.  “Noteholder Trustee” shall mean U.S. Bank National Association, in its capacity as trustee under the  Noteholder Agreement, and also includes any successor, replacement or agent acting on its behalf as Noteholder  Trustee for the Noteholder Secured Parties under the Noteholder Documents.  “Notes” shall mean any notes issued pursuant to the Noteholder Agreement, whether issued pursuant to  the initial offering or subsequently, including any exchange notes and additional notes.  “Other Borrower” shall have the meaning set forth in the preamble hereto.  “Permitted Actions” shall mean any of the following: (a) in any Insolvency or Liquidation Proceeding,  filing a proof of claim or statement of interest with respect to the Noteholder Debt or Excess ABL Debt, as the  case may be; (b) taking any action to preserve or protect the validity, enforceability, perfection or priority of the  Liens securing the Noteholder Debt or the Excess ABL Debt, as the case may be, provided that no such action  is, or could reasonably be expected to be, (i) as to any action by any Noteholder Secured Party, adverse to the  Liens securing the First Priority Debt or the rights of the ABL Agent or any other ABL Secured Party to  exercise remedies in respect thereof to the extent not expressly prohibited by this Agreement, (ii) as to any  action by any ABL Secured Party, adverse to the Liens securing the Noteholder Debt or the rights of the  Collateral Agent or any other Noteholder Secured Party to exercise remedies in respect thereof to the extent not  expressly prohibited by this Intercreditor Agreement, or (iii) otherwise inconsistent with the terms of this  Intercreditor Agreement, including the automatic release of Liens provided in Section 3.3; (c) filing any  responsive or defensive pleadings in opposition to any motion, claim, adversary proceeding or other pleading  made by any Person objecting to or otherwise seeking the disallowance of the claims of the Noteholder Secured  Parties or the claims of the ABL Secured Parties with respect to Excess ABL Debt, including any claims secured  

 

-6-  by the ABL Collateral or otherwise making any agreements or filing any motions pertaining to the Noteholder  Debt or Excess ABL Debt, in each case, to the extent not inconsistent with the terms of this Intercreditor  Agreement; (d) exercising rights and remedies as unsecured creditors, as provided in Section 3.2; and (e) the  enforcement by the Collateral Agent and the Noteholder Secured Parties of any of their rights and exercise any  of their remedies with respect to the ABL Collateral after the termination of the Standstill Period (as defined in  Section 3.1) or the enforcement by the ABL Agent or the ABL Secured Parties of any of their rights and  exercise of any of their remedies with respect to the ABL Collateral after Discharge of Priority Noteholder Debt.  “Person” or “person” shall mean any individual, sole proprietorship, partnership, corporation (including  any corporation which elects subchapter S status under the Internal Revenue Code of 1986, as amended), limited  liability company, limited liability partnership, business trust, unincorporated association, joint stock company,  trust, joint venture, or other entity or any government or any agency or instrumentality or political subdivision  thereof.  “Pledged ABL Collateral” shall have the meaning set forth in Section 5.1(a).  “Prior Collateral Agent” shall have the meaning set forth in the recitals hereto.  “Qualified Financier” shall mean (a) a commercial bank organized under the laws of the United States,  or any state thereof, and having total assets in excess of $500,000,000, (b) a commercial bank organized under  the laws of any other country which is a member of the Organization for Economic Cooperation and  Development or a political subdivision of any such country and which has total assets in excess of  $500,000,000; provided that such bank is acting through a branch or agency located in the United States, and  (c) a commercial finance company, insurance company or other financial institution that is engaged in making,  purchasing or otherwise investing in commercial loans in the ordinary course of its business and having total  assets in excess of $500,000,000.   “Secured Parties” shall mean, collectively, the ABL Secured Parties and the Noteholder Secured  Parties.  “Standstill Period” shall have the meaning set forth in Section 3.1(a)(i)1(a)(i).  “Uniform Commercial Code” or “UCC” means the Uniform Commercial Code as from time to time in  effect in the State of New York.  1.2 Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of  the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine,  feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by  the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the  word “shall.” Unless the context requires otherwise (a) any definition of or reference to any agreement,  instrument or other document herein shall be construed as referring to such agreement, instrument or other  document as from time to time amended, supplemented or otherwise modified, (b) any reference herein to any  Person shall be construed to include such Person’s successors and assigns, and as to any Borrower shall be  deemed to include a receiver, trustee or debtor-in-possession on behalf of any of such person or on behalf of any  such successor or assign, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall  be construed to refer to this Intercreditor Agreement in its entirety and not to any particular provision hereof, (d)  all references herein to Sections shall be construed to refer to Sections of this Intercreditor Agreement and (e)  the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and  all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.  Section 2. LIEN PRIORITIES.  2.1 Subordination. Notwithstanding the date, manner or order of grant, attachment or perfection of any  Liens granted to the ABL Agent or the ABL Secured Parties or the Collateral Agent or the Noteholder Secured  Parties and notwithstanding any provision of the UCC, or any applicable law or any provisions of the ABL  Documents or the Noteholder Documents or any other circumstance whatsoever:  (a) The Collateral Agent, for itself and on behalf of the other Noteholder Secured Parties, hereby  agrees that: (i) any Lien on the ABL Collateral securing the First Priority Debt now or hereafter held by or for  

 

-7-  the benefit or on behalf of any ABL Secured Party or any agent or trustee therefor shall be senior in right,  priority, operation, effect and in all other respects to any Lien on the ABL Collateral securing the Noteholder  Debt now or hereafter held by or for the benefit or on behalf of any Noteholder Secured Party or any agent or  trustee therefor; and (ii) any Lien on the ABL Collateral securing any of the Noteholder Debt now or hereafter  held by or for the benefit or on behalf of any Noteholder Secured Party or any agent or trustee therefor  regardless of how acquired, whether by grant, statute, operation of law, subrogation or otherwise, shall be junior  and subordinate in all respects to all Liens on the ABL Collateral securing any First Priority Debt.  (b) The ABL Agent, for itself and on behalf of the other ABL Secured Parties, hereby agrees that:  (i) any Lien on the ABL Collateral securing the Noteholder Debt now or hereafter held by or for the benefit or  on behalf of any Noteholder Secured Party or any agent or trustee therefor shall be senior in right, priority,  operation, effect and in all other respects to any Lien on the ABL Collateral securing the principal amount of  Excess ABL Debt now or hereafter held by or for the benefit or on behalf of any ABL Secured Party or any  agent or trustee therefor; and (ii) any Lien on the ABL Collateral securing any Excess ABL Debt now or  hereafter held by or for the benefit or on behalf of any ABL Secured Party or any agent or trustee therefor  regardless of how acquired, whether by grant, statute, operation of law, subrogation or otherwise, shall be junior  and subordinate in all respects to all Liens on the ABL Collateral securing any Noteholder Debt.  2.2 Prohibition on Contesting Liens. Each of the ABL Agent, for itself and on behalf of the other ABL  Secured Parties, and the Collateral Agent, for itself and on behalf of the other Noteholder Secured Parties,  agrees that it shall not (and hereby waives any right to) contest or support any other Person in contesting, in any  proceeding (including any Insolvency or Liquidation Proceeding involving any Borrower), the perfection,  priority, validity or enforceability of a Lien held by or for the benefit or on behalf of any ABL Secured Party in  any ABL Collateral or by or on behalf of any Noteholder Secured Party in any ABL Collateral, as the case may  be; provided that nothing in this Intercreditor Agreement shall be construed to prevent or impair the rights of  any ABL Secured Party or Noteholder Secured Party to enforce this Intercreditor Agreement, including the  priority of the Liens as provided in Section 2.1.  2.3 No New Liens.  (a) So long as the Discharge of Priority Debt has not occurred, except for Noteholder Exclusive  Assets (as defined below), none of the Borrowers shall grant any additional Liens on any assets to secure the  Noteholder Debt unless it has granted, or substantially concurrently therewith shall grant, a lien on such asset to  secure the ABL Debt or grant any additional Liens on any assets to secure the ABL Debt unless it has granted,  or substantially concurrently therewith shall grant, a Lien on such asset to secure the Noteholder Debt, all of  which Liens shall be subject to the terms of this Intercreditor Agreement. Further, the parties hereto agree that,  after the Discharge of Priority Debt and so long as the Discharge of Priority Noteholder Debt has not occurred,  none of the Borrowers shall grant any additional Liens on any asset to secure any Excess ABL Debt unless it  has granted, or substantially concurrently therewith shall grant, a Lien on such asset to secure the Noteholder  Debt. Notwithstanding the foregoing, this provision will not be violated with respect to any assets which are  specifically excluded from the grant of Liens securing the ABL Debt or the Noteholder Debt, as provided in the  ABL Documents or Noteholder Documents, respectively. To the extent that the provisions of this Section 2.3  are not complied with for any reason, without limiting any other right or remedy available to the ABL Agent or  any other ABL Secured Party or the Collateral Agent or any Noteholder Secured Party, the Collateral Agent  agrees, for itself and on behalf of the other Noteholder Secured Parties, and the ABL Agent agrees, for itself and  on behalf of the other ABL Secured Parties, that any amount received by or distributed to any Noteholder  Secured Party or any ABL Secured Party pursuant to or as a result of any Lien granted in contravention of this  Section shall be subject to Section 4 hereof.  (b) The Noteholder Secured Parties and the ABL Secured Parties hereby acknowledge and agree  that (i) the ABL Debt is secured by a first priority Lien in favor of the ABL Secured Parties on all of the  Collateral (as such term is defined in the ABL Loan Agreement), (ii) as of the date hereof, the Noteholder  Secured Parties do not have and will not hereafter obtain a Lien on the cash or deposit accounts of any  Borrower, except a Lien junior in priority to the Lien in favor of the ABL Secured Parties securing the First  Priority Debt, which Lien will be subject to the terms and conditions of this Agreement, (iii) the Noteholder  Debt is secured by a Lien in favor of the Noteholder Secured Parties on all of the Collateral (as such term is  defined in the Noteholder Agreement), including a Lien on the assets of Vector Tobacco Inc., a Virginia  corporation (“Vector Tobacco”) and on capital stock owned by VGR Holding LLC, a Delaware limited liability  company constituting Collateral (as such term is defined in the Noteholder Agreement) (such assets of Vector  Tobacco and capital stock owned by VGR Holding LLC, the “Noteholder Exclusive Assets”); provided that, if  

 

-8-  Vector Tobacco becomes an additional borrower under the ABL Loan Agreement and executes a  Joinder Agreement to this Agreement, the assets of Vector Tobacco shall no longer constitute a  Noteholder Exclusive Asset and shall thereafter constitute ABL Collateral under this Agreement) and  (iv) as of the date hereof, the ABL Secured Parties do not have and will not hereafter obtain a Lien on the  Noteholder Exclusive Assets, except a Lien, junior in priority to the Lien in favor of the Noteholder Secured  Parties.   2.4 Cooperation. The parties hereto agree, subject to the other provisions of this Intercreditor Agreement,  upon request by the ABL Agent or the Collateral Agent, as the case may be, to advise the other from time to  time of the ABL Collateral for which such party has taken steps to perfect its Liens and to identify the parties  obligated under the ABL Documents or Noteholder Documents, as the case may be.  Section 3. ENFORCEMENT.  3.1 Exercise of Rights and Remedies.   (a) Until the Discharge of Priority Debt, the Collateral Agent, for itself and on behalf of the other  Noteholder Secured Parties, agrees that it:  (i) will not enforce or exercise, or seek to enforce or exercise, any rights or remedies  (including any right of setoff or notification of account debtors) with respect to any ABL Collateral (including  the enforcement of any right under any lockbox agreement, account control agreement, landlord waiver or  bailee’s letter or any similar agreement or arrangement to which the Collateral Agent or any other Noteholder  Secured Party is a party) or commence or join with any Person (other than the ABL Agent) in commencing, or  filing a petition for, any action or proceeding with respect to such rights or remedies with respect to the ABL  Collateral (including any foreclosure action or proceeding or any Insolvency or Liquidation Proceeding);  provided, however, that (A) the Collateral Agent and the Noteholder Secured Parties may take Permitted  Actions, and (B) the Collateral Agent may exercise any or all of such rights or remedies after a period of 180  days has elapsed since the later of (1) the date on which any Noteholder Secured Party has declared the  existence of any event of default under (and as defined in) the Noteholder Agreement, (2) any Noteholder  Secured Party shall have demanded the repayment of all the principal amount of the Noteholder Debt and (3)  any Noteholder Secured Party shall have notified the ABL Agent of such declaration of a Noteholder Default  and demand (the “Standstill Period”); provided, further, that, notwithstanding the expiration of the Standstill  Period or anything herein to the contrary, in no event shall the Collateral Agent or any other Noteholder Secured  Party enforce or exercise any rights or remedies with respect to any ABL Collateral, or commence or petition  for any such action or proceeding (including any foreclosure action or proceeding or any Insolvency or  Liquidation Proceeding), at any time during which the ABL Agent or any other ABL Secured Party shall have  commenced and shall be pursuing diligently a Lien Enforcement Action;  (ii) will not contest, protest or object to any foreclosure action or proceeding brought by  the ABL Agent or any other ABL Secured Party, or any other enforcement or exercise by any ABL Secured  Party of any rights or remedies, in each case relating to the ABL Collateral under the ABL Documents, so long  as the Liens of the Collateral Agent attach to the proceeds thereof subject to the relative priorities set forth in  Section 2.1 and such actions or proceedings are being pursued in good faith in accordance with applicable law;  (iii) subject to the Noteholder Secured Parties’ rights under Section 3.1(a)(i), will not  object to the forbearance by the ABL Agent or the other ABL Secured Parties from commencing or pursuing  any foreclosure action or proceeding or any other enforcement or exercise of any rights or remedies with respect  to any of the ABL Collateral;  (iv) will not except for actions permitted under Section 3.1(a)(i), take or receive any ABL  Collateral, or any proceeds thereof or payment with respect thereto, in connection with the exercise of any right  or remedy (including any right of setoff) with respect to any ABL Collateral or in connection with any insurance  policy award or any condemnation award (or deed in lieu of condemnation) relating to the ABL Collateral;  (v) will not object to the manner in which the ABL Agent or any other ABL Secured  Party may seek to enforce or collect the ABL Debt or the Liens of such ABL Secured Party securing First  Priority Debt, regardless of whether any action or failure to act by or on behalf of the ABL Agent or any other  ABL Secured Party is, or could be, adverse to the interests of the Noteholder Secured Parties, and will not  

 

-9-  assert, and hereby waives, to the fullest extent permitted by law, any right to demand, request, plead or  otherwise assert or claim the benefit of any marshalling, appraisal, valuation or other similar right that may be  available under applicable law with respect to the ABL Collateral or any other rights a junior secured creditor  may have under applicable law with respect to the matters described in this clause (v), provided that at all times  the ABL Agent is acting in good faith in accordance with applicable law; and  (vi) will not attempt, directly or indirectly, whether by judicial proceeding or otherwise,  to challenge or question the validity or enforceability of any First Priority Debt, any Lien of the ABL Agent on  the ABL Collateral securing the First Priority Debt or this Intercreditor Agreement, or the validity or  enforceability of the priorities, rights or obligations established by this Intercreditor Agreement.  (b) After the Discharge of Priority Debt and until the Discharge of Priority Noteholder Debt has  occurred, the ABL Agent, for itself and on behalf of the other ABL Secured Parties, with respect to Excess ABL  Debt agrees that it:  (i) will not, enforce or exercise, or seek to enforce or exercise, any rights or remedies  (including any right of setoff or notification of account debtors) with respect to any ABL Collateral (including  the enforcement of any right under any lockbox agreement, account control agreement, landlord waiver or  bailee’s letter or any similar agreement or arrangement to which the ABL Agent or any other ABL Secured  Party is a party) or commence or join with any Person (other than Collateral Agent or Noteholder Secured  Parties) in commencing, or filing a petition for, any action or proceeding with respect to such rights or remedies  with respect to the ABL Collateral (including any foreclosure action or proceeding or any Insolvency or  Liquidation Proceeding); provided, however, that the ABL Agent and the ABL Secured Parties may take  Permitted Actions;  (ii) will not contest, protest or object to any foreclosure action or proceeding brought by  the Collateral Agent or any other Noteholder Secured Party, or any other enforcement or exercise by any  Noteholder Secured Party of any rights or remedies relating to the ABL Collateral under the Noteholder  Documents, so long as the Liens of ABL Secured Parties attach to the proceeds thereof subject to the relative  priorities set forth in Section 2.1 and such actions or proceedings are being pursued in good faith in accordance  with applicable law;  (iii) subject to the ABL Secured Parties’ rights under Section 3.1(b)(i), will not object to  the forbearance by the Collateral Agent or the other Noteholder Secured Parties from commencing or pursuing  any foreclosure action or proceeding or any other enforcement or exercise of any rights or remedies with respect  to any of the ABL Collateral;  (iv) will not except for actions permitted under Section 3.1(b)(i), take or receive any ABL  Collateral, or any proceeds thereof or payment with respect thereto, in connection with the exercise of any right  or remedy (including any right of setoff) with respect to any ABL Collateral or in connection with any insurance  policy award or any condemnation award (or deed in lieu of condemnation) relating to the ABL Collateral;  (v) will not object to the manner in which the Collateral Agent or any other Noteholder  Secured Party may seek to enforce or collect the Noteholder Debt or the Liens of such Noteholder Secured Party  securing Noteholder Debt, regardless of whether any action or failure to act by or on behalf of the Collateral  Agent or any other Noteholder Secured Party is, or could be, adverse to the interests of the ABL Secured Parties  with respect to the Excess ABL Debt and Liens securing such Excess ABL Debt, and will not assert, and hereby  waive, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or claim the  benefit of any marshalling, appraisal, valuation or other similar right that may be available under applicable law  with respect to the ABL Collateral or any other rights a junior secured creditor may have under applicable law  with respect to the matters described in this clause (v) in each case to the extent that the ABL Collateral secures  Excess ABL Debt, provided that at all times the Collateral Agent is acting in good faith in accordance with  applicable law; and  (vi) will not attempt, directly or indirectly, whether by judicial proceeding or otherwise,  to challenge or question the validity or enforceability of any Noteholder Debt or any Lien of the Collateral  Agent or the Noteholder Secured Parties securing the Noteholder Debt or this Intercreditor Agreement, or the  validity or enforceability of the priorities, rights or obligations established by this Intercreditor Agreement.  3.2 Rights As Unsecured Creditors. Notwithstanding anything to the contrary in this Intercreditor  

 

-10-  Agreement, the Collateral Agent and the other Noteholder Secured Parties may exercise rights and remedies as  an unsecured creditor against any Borrower in accordance with the terms of the Noteholder Documents and  applicable law. For purposes hereof, the rights of an unsecured creditor do not include the rights of a creditor  that holds a judgment lien to enforce such lien. Nothing in this Intercreditor Agreement shall prohibit the receipt  by the Collateral Agent or any other Noteholder Secured Parties of the payments of any Noteholder Debt so  long as such receipt is not the direct or indirect result of the exercise by the Collateral Agent or any other  Noteholder Secured Party of foreclosure rights with respect to any ABL Collateral or other remedies as a  secured creditor of any ABL Party or enforcement in contravention of this Intercreditor Agreement of any Lien  held by any of them in any ABL Collateral or any other act in contravention of this Intercreditor Agreement.  3.3 Release of Liens on ABL Collateral.  (a) Prior to Discharge of Priority Debt, if (i) in connection with any sale, lease, license, exchange,  transfer or other disposition of any ABL Collateral (A) permitted under the terms of the ABL Documents  (whether or not an event of default or equivalent event thereunder, and as defined therein, has occurred and is  continuing) or (B) consented to or approved by the ABL Agent, but in the case of (A) or (B) only if permitted  under the terms of the Noteholder Documents or (ii) in connection with the exercise of the ABL Agent’s  remedies in respect of the ABL Collateral provided for in Section 3.1 (provided that after giving effect to the  release and application of proceeds, ABL Debt (other than Excess ABL Debt) secured by the first priority Liens  on the remaining ABL Collateral remains outstanding), the ABL Agent, for itself or on behalf of any of the  other ABL Secured Parties, releases any of its Liens on any part of the ABL Collateral, then effective upon the  consummation of such sale, lease, license, exchange, transfer or other disposition:  (1) the Liens, if any, of the Collateral Agent, for itself or for the benefit of the  Noteholder Secured Parties, on such ABL Collateral shall be automatically, unconditionally and simultaneously  released to the same extent as the release of the ABL Agent’s Liens,  (2) the Collateral Agent, for itself or on behalf of the Noteholder Secured  Parties, shall promptly upon the request of the ABL Agent execute and deliver such release documents and  confirmations of the authorization to file UCC amendments and terminations provided for herein, in each case  as the ABL Agent may reasonably require in connection with such sale or other disposition by the ABL Agent,  the ABL Agent’s agents or any Borrower with the consent of the ABL Agent to evidence and effectuate such  termination and release; provided, that, any such release or UCC amendment or termination by Collateral Agent  shall not extend to or otherwise affect any of the rights, if any, of Collateral Agent and Noteholder Secured  Parties to the proceeds from any such sale or other disposition of ABL Collateral, and  (3) the Collateral Agent, for itself or on behalf of the other Noteholder Secured  Parties, shall be deemed to have authorized the ABL Agent to file UCC amendments and terminations covering  the ABL Collateral so sold or otherwise disposed of as to UCC financing statements between any Borrower and  Collateral Agent or any other Noteholder Secured Party to evidence such release and termination.  (b) After Discharge of Priority Debt but prior to Discharge of Priority Noteholder Debt, if (i) in  connection with any sale, lease, license, exchange, transfer or other disposition of any ABL Collateral (A)  permitted under the terms of the Noteholder Documents (whether or not an event of default or equivalent event  thereunder, and as defined therein, has occurred and is continuing) or (B) consented to or approved by  Noteholder Secured Parties, but in the case of (A) and (B), only if permitted under the terms of the ABL  Documents, or (ii) in connection with the exercise of the Collateral Agent’s or any Noteholder Secured Party’s  remedies in respect of the ABL Collateral provided for in Section 3.1 (provided that after giving effect to the  release and application of proceeds, Noteholder Debt secured by the Liens on the remaining ABL Collateral  remain outstanding), the Collateral Agent, for itself or on behalf of any of the other Noteholder Secured Parties,  releases any of its Liens on any part of the ABL Collateral, then effective upon the consummation of such sale,  lease, license, exchange, transfer or other disposition:  (1) the Liens, if any, of the ABL Agent, for itself or for the benefit of the ABL  Secured Parties, on such ABL Collateral shall be automatically, unconditionally and simultaneously released to  the same extent as the release of the Collateral Agent’s Liens,  (2) the ABL Agent, for itself or on behalf of the ABL Secured Parties, shall  promptly upon the request of the Collateral Agent execute and deliver such release documents and  confirmations of the authorization to file UCC amendments and terminations provided for herein, in each case  

 

-11-  as the Collateral Agent may reasonably require in connection with such sale or other disposition by the  Collateral Agent or any Noteholder Secured Party, or any of their agents or any Borrower with the consent of  Noteholder Secured Parties to evidence and effectuate such termination and release; provided, that, any such  release or UCC amendment or termination by the ABL Agent shall not extend to or otherwise affect any of the  rights, if any, of the ABL Agent and ABL Secured Parties to the proceeds from any such sale or other  disposition of ABL Collateral, and  (3) the ABL Agent, for itself or on behalf of the other ABL Secured Parties,  shall be deemed to have authorized the Collateral Agent to file UCC amendments and terminations covering the  ABL Collateral so sold or otherwise disposed of as to UCC financing statements between any Borrower and the  ABL Agent or any other ABL Secured Party to evidence such release and termination.  (c) The Collateral Agent, for itself and on behalf of the other Noteholder Secured Parties, hereby  irrevocably constitutes and appoints the ABL Agent and any officer or agent of the ABL Agent, with full power  of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and  stead of the Collateral Agent or such holder, from time to time in the ABL Agent’s discretion, for the purpose of  carrying out the terms of Section 3.3(a), to take any and all appropriate action and to execute any and all  documents and instruments which may be necessary or desirable to accomplish the purposes of Section 3.3(a),  including any termination statements, endorsements or other instruments of transfer or release. The ABL Agent,  for itself and on behalf of the other ABL Secured Parties, hereby irrevocably constitutes and appoints the  Collateral Agent and any officer or agent of the Noteholder, with full power of substitution, as its true and  lawful attorney-in-fact with full irrevocable power and authority in the place and stead of the ABL Agent or any  ABL Secured Party for the purpose of carrying out the terms of Section 3.3(b), to take any and all appropriate  action and to execute any and all documents and instruments which may be necessary or desirable to accomplish  the purposes of Section 3.3(b), including any termination statements, endorsements or other instruments of  transfer or release.  (d) Nothing contained in this Intercreditor Agreement shall be construed to modify the obligation  of the ABL Agent or the Collateral Agent to act in a commercially reasonable manner in the exercise of its  rights to sell, lease, license, exchange, transfer or otherwise dispose of any ABL Collateral.  3.4 Insurance and Condemnation Awards.  (a) So long as the Discharge of Priority Debt has not occurred, the ABL Agent and the other ABL  Secured Parties shall have the sole and exclusive right, subject to the rights of the Borrowers under the ABL  Documents, to settle and adjust claims in respect of ABL Collateral under policies of insurance and to approve  any award granted in any condemnation or similar proceeding, or any deed in lieu of condemnation in respect of  the ABL Collateral. So long as the Discharge of Priority Debt has not occurred, all proceeds of any such policy  and any such award, or any payments with respect to a deed in lieu of condemnation, shall (i) first be paid to the  ABL Agent for the benefit of the ABL Secured Parties to the extent required under the ABL Documents until  the Priority Debt has been paid in full, (ii) second, be paid to the Collateral Agent for the benefit of the  Noteholder Secured Parties to the extent required under the applicable Noteholder Documents until the  Discharge of Priority Noteholder Debt has occurred, (iii) third, be paid to the ABL Agent for the benefit of the  ABL Secured Parties to the extent required under the ABL Documents until the ABL Debt has been paid in full,  and (iv) fourth, be paid to the owner of the subject property or as a court of competent jurisdiction may  otherwise direct or may otherwise be required by applicable law. Until the Discharge of Priority Debt, if the  Collateral Agent or any other Noteholder Secured Party shall, at any time, receive any proceeds of any such  insurance policy or any such award or payment, it shall pay such proceeds over to the ABL Agent in accordance  with the terms of Section 4.2.  (b) After the Discharge of Priority Debt has occurred but before the Discharge of Priority  Noteholder Debt has occurred, the Collateral Agent and the other Noteholder Secured Parties shall have the sole  and exclusive right, subject to the rights of the Borrowers under the Noteholder Documents, to settle and adjust  claims in respect of ABL Collateral under policies of insurance and to approve any award granted in any  condemnation or similar proceeding, or any deed in lieu of condemnation in respect of the ABL Collateral.  After the Discharge of Priority Debt has occurred but before the Discharge of Priority Noteholder Debt has  occurred, all proceeds of any such policy and any such award, or any payments with respect to a deed in lieu of  condemnation, shall (i) first be paid to the Collateral Agent for the benefit of the Noteholder Secured Parties to  the extent required under the Noteholder Documents until the Noteholder Debt has been paid in full, (ii) second,  be paid to the ABL Agent for the benefit of the ABL Secured Parties to the extent required under the ABL  

 

-12-  Documents until the Excess ABL Debt has been paid in full, and (iii) third, be paid to the owner of the subject  property or as a court of competent jurisdiction may otherwise direct or may otherwise be required by applicable  law. After the Discharge of Priority Debt has occurred but before the Discharge of Priority Noteholder Debt has  occurred, if the ABL Agent or any other ABL Secured Party shall, at any time, receive any proceeds of any such  insurance policy or any such award or payment, it shall pay such proceeds over to the Collateral Agent in  accordance with the terms of Section 4.2.  Section 4. PAYMENTS.  4.1 Application of Proceeds.  (a) So long as the Discharge of ABL Debt has not occurred, the ABL Collateral or proceeds  thereof received in connection with the sale or other disposition of, or collection on, such ABL Collateral upon  the exercise of remedies, shall be applied in the following order of priority:  (i) first, to the First Priority Debt (including for cash collateral as required under the  ABL Documents), and in such order as specified in the relevant ABL Documents until the Discharge of Priority  Debt has occurred;  (ii) second, to the Noteholder Debt in such order as specified in the relevant Noteholder  Documents until the Discharge of Priority Noteholder Debt has occurred; and  (iii) third, to the Excess ABL Debt until the Discharge of ABL Debt has occurred.  (b) Upon the Discharge of Priority Debt, to the extent permitted under applicable law, the ABL  Agent shall deliver to the Collateral Agent, without representation or recourse, any proceeds of ABL Collateral  held by it at such time in the same form as received, with any necessary endorsements or as a court of competent  jurisdiction may otherwise direct, to be applied by the Collateral Agent to the Noteholder Debt in such order as  specified in the relevant Noteholder Documents.  (c) The foregoing provisions of this Section 4.1 are intended solely to govern the respective Lien  priorities as between the Collateral Agent and the Noteholder Secured Parties, on the one hand, and the ABL  Agent and the other ABL Secured Parties, on the other hand, and shall not impose on the ABL Agent or any  other ABL Secured Party or on Collateral Agent or any other Noteholder Secured Party any obligations in  respect of the disposition of proceeds of foreclosure on any ABL Collateral which would conflict with prior  perfected claims therein in favor of any other person or any order or decree of any court or other governmental  authority or any applicable law.  4.2 Payments Over. So long as the Discharge of Priority Debt has not occurred, whether or not any  Insolvency or Liquidation Proceeding has been commenced by or against any Borrower, the Collateral Agent  agrees, for itself and on behalf of the other Noteholder Secured Parties, that any ABL Collateral or proceeds  from the enforcement of remedies with respect to the ABL Collateral (including any right of set-off) with  respect to the ABL Collateral, and including in connection with any insurance policy claim or any  condemnation award (or deed in lieu of condemnation) with respect to ABL Collateral, shall be segregated and  held in trust and promptly transferred or paid over to the ABL Agent for the benefit of the ABL Secured Parties  in the same form as received, with any necessary endorsements or assignments or as a court of competent  jurisdiction may otherwise direct. After the Discharge of Priority Debt has occurred but before the Discharge of  Priority Noteholder Debt has occurred, whether or not any Insolvency or Liquidation Proceeding has been  commenced by or against any Borrower, the ABL Agent agrees, for itself and on behalf of the other ABL  Secured Parties, that any ABL Collateral or proceeds from the enforcement of remedies with respect to the ABL  Collateral or payment with respect thereto received by the ABL Agent or any other ABL Secured Party  (including any right of set-off) with respect to the ABL Collateral, and including in connection with any  insurance policy claim or any condemnation award (or deed in lieu of condemnation) with respect to ABL  Collateral, shall be segregated and held in trust and promptly transferred or paid over to the Collateral Agent for  the benefit of the Noteholder Secured Parties in the same form as received, with any necessary endorsements or  assignments or as a court of competent jurisdiction may otherwise direct. The ABL Agent or the Collateral  Agent, as applicable, is hereby authorized to make any such endorsements or assignments as agent for the other.  This authorization is coupled with an interest and is irrevocable.  

 

-13-  Section 5. BAILEE FOR PERFECTION.  5.1 Each Lender as Bailee.  (a) Each of the ABL Agent and Collateral Agent (each, for purposes of this Section 5, an  “Agent”) agrees to hold any ABL Collateral that can be perfected or the priority of which can be enhanced by  the possession or control of such ABL Collateral or of any account in which such ABL Collateral is held, and if  such ABL Collateral or any such account is in fact in the possession or under the control of an Agent, or of  agents or bailees of such Agent (such ABL Collateral being referred to herein as the “Pledged ABL Collateral”),  as bailee and agent for and on behalf of the other Agent solely for the purpose of perfecting the Lien granted to  the other Agent in such Pledged ABL Collateral or enhancing the priority of such Lien (including, but not  limited to, any securities or any deposit accounts or securities accounts, if any) pursuant to the ABL Documents  or Noteholder Documents, as applicable, subject to the terms and conditions of this Section 5.  (b) Until the Discharge of Priority Debt has occurred, the ABL Agent shall be entitled to deal  with the Pledged ABL Collateral in accordance with the terms of the ABL Documents subject to the terms of  this Intercreditor Agreement and to the Borrowers’ rights under the ABL Documents.  (c) Each of the ABL Agent and Collateral Agent shall have no obligation whatsoever to the other  Agent or any other Secured Party to assure that the Pledged ABL Collateral is genuine or owned by any of the  Borrowers or to preserve rights or benefits of any Person except as expressly set forth in this Section 5. The  duties or responsibilities of each of ABL Agent and Collateral Agent under this Section 5 shall be limited solely  to holding the Pledged ABL Collateral as bailee and agent for and on behalf of the other Agent for purposes of  perfecting or enhancing the priority of the Lien held by the other Agent.  (d) Each of the ABL Agent and Collateral Agent shall not have by reason of the ABL Documents,  the Noteholder Documents or this Intercreditor Agreement or any other document a fiduciary relationship in  respect of the other Agent or any of the other Secured Parties and shall not have any liability to the other Agent  or any other Secured Party in connection with its holding the Pledged ABL Collateral, other than for its gross  negligence or willful misconduct as determined by a final, non-appealable order of a court of competent  jurisdiction.  5.2 Transfer of Pledged ABL Collateral. Upon the Discharge of Priority Debt, to the extent permitted  under applicable law, the ABL Agent shall, without recourse or warranty, transfer the possession and control of  the Pledged ABL Collateral, if any, then in its possession or control to Collateral Agent, except in the event and  to the extent (a) the ABL Agent or any other ABL Secured Party has retained or otherwise acquired such ABL  Collateral in full or partial satisfaction of any of the ABL Debt, (b) such ABL Collateral is sold or otherwise  disposed of by the ABL Agent or any other ABL Secured Party or by a Borrower as provided herein or (c) it is  otherwise required by any order of any court or other governmental authority or applicable law. The foregoing  provision shall not impose on the ABL Agent or any other ABL Secured Party any obligations which would  conflict with prior perfected claims therein in favor of any other person or any order or decree of any court or  other governmental authority or any applicable law. In connection with any transfer described herein to  Collateral Agent, the Agent agrees to take reasonable actions in its power (with all costs and expenses in  connection therewith to be for the account of the Collateral Agent and to be paid by Borrowers) as shall be  reasonably requested by the Collateral Agent to permit the Collateral Agent to obtain, for the benefit of the  Noteholder Secured Parties, a first priority Lien in the Pledged ABL Collateral.  Section 6. INSOLVENCY OR LIQUIDATION PROCEEDINGS.  6.1 General Applicability. This Intercreditor Agreement shall be applicable both before and after the  institution of any Insolvency or Liquidation Proceeding involving any Borrower, including the filing of any  petition by or against any Borrower under the Bankruptcy Code or under any other Bankruptcy Law and all  converted or subsequent cases in respect thereof, and all references herein to any Borrower shall be deemed to  apply to the trustee for such Borrower and such Borrower as debtor-in-possession. The relative rights of the  ABL Secured Parties and the Noteholder Secured Parties in or to any distributions from or in respect of any  ABL Collateral or proceeds of ABL Collateral shall continue after the institution of any Insolvency or  Liquidation Proceeding involving any Borrower, including the filing of any petition by or against any Borrower  under the Bankruptcy Code or under any other Bankruptcy Law and all converted cases and subsequent cases,  on the same basis as prior to the date of such institution, subject to (i) any court order approving the financing  

 

-14-  of, or use of cash collateral by any Borrower as debtor-in-possession, or (ii) any other court order affecting the  rights and interests of the parties hereto, in either case so long as such court order is not in conflict with this  Intercreditor Agreement. This Agreement shall constitute a Subordination Agreement for the purposes of  Section 510(a) of the Bankruptcy Code and shall be enforceable in any Insolvency or Liquidation Proceeding in  accordance with its terms.  6.2 Bankruptcy Financing. If any Borrower becomes subject to any Insolvency or Liquidation Proceeding,  until the Discharge of Priority Debt has occurred, the Collateral Agent, for itself and on behalf of the other  Noteholder Secured Parties, agrees that:  (a) each Noteholder Secured Party will raise no objection to, nor support any other Person  objecting to, and will be deemed to have consented to, the use of any ABL Collateral constituting cash collateral  under Section 363 of the Bankruptcy Code, or any comparable provision of any other Bankruptcy Law, or any  post-petition financing to any Borrower provided by any ABL Secured Party or any Qualified Financier (which  agrees to be bound by Section 8 hereof) under Section 364 of the Bankruptcy Code, or any comparable  provision of any other Bankruptcy Law (a “DIP Financing”), will not request or accept adequate protection or  any other relief in connection with the use of such cash collateral or such DIP Financing except as set forth in  Section 6.4 below and will subordinate (and will be deemed hereunder to have subordinated) the Liens granted  to Noteholder Secured Parties to such DIP Financing on the same terms as such Liens are subordinated to the  Liens granted to the ABL Agent hereunder (and such subordination will not alter in any manner the terms of this  Intercreditor Agreement), to any adequate protection provided to the ABL Secured Parties and to any Carve  Out; provided that:  (i) the ABL Agent does not oppose or object to such use of cash collateral or DIP  Financing,  (ii) the aggregate principal amount of such DIP Financing, together with the ABL Debt  as of such date, does not exceed the principal component of the Maximum Priority ABL Debt Amount, and the  DIP Financing is treated as ABL Debt hereunder,  (iii) the Liens on ABL Collateral granted to the ABL Secured Parties or Qualified  Financier in connection with such DIP Financing are subject to this Intercreditor Agreement and considered to  be Liens of the ABL Agent for purposes hereof,  (iv) the Collateral Agent retains a Lien on the ABL Collateral (including proceeds  thereof) with the same priority as existed prior to such Insolvency or Liquidation Proceeding (except to the  extent of any Carve Out agreed to by the ABL Agent),  (v) the Collateral Agent receives replacement Liens on all assets, including post-petition  assets, of any Borrower in which any of the ABL Agent obtains a replacement Lien, or which secure the DIP  Financing, with the same priority relative to the Liens of ABL Agent as existed prior to such Insolvency or  Liquidation Proceeding, and  (vi) the Noteholder Secured Parties may oppose or object to such use of cash collateral or  DIP Financing on the same bases as an unsecured creditor, so long as such opposition or objection is not based  on the Noteholder Secured Parties’ status as secured creditors.  (b) no Noteholder Secured Party shall, directly or indirectly, provide, or seek to provide or  support any party seeking to provide (other than the ABL Agent or a Qualified Financier as provided above),  DIP Financing secured by Liens equal or senior in priority to the Liens on the ABL Collateral of the ABL  Agent, without the prior written consent of the ABL Agent.  6.3 Relief from the Automatic Stay. The Collateral Agent, for itself and on behalf of the other Noteholder  Secured Parties, agrees that, so long as the Discharge of Priority Debt has not occurred, no Noteholder Secured  Party shall, without the prior written consent of the ABL Agent, seek or request relief from or modification of  the automatic stay or any other stay in any Insolvency or Liquidation Proceeding in respect of any part of the  ABL Collateral, any proceeds thereof or any Lien securing any of the Noteholder Debt. Notwithstanding  anything to the contrary set forth in this Intercreditor Agreement, no Borrower waives or shall be deemed to  have waived any rights under Section 362 of the Bankruptcy Code.  

 

-15-  6.4 Adequate Protection.  (a) The Collateral Agent, on behalf of itself and the other Noteholder Secured Parties, agrees that  none of them shall object, contest, or support any other Person objecting to or contesting, (i) any request by the  ABL Agent or any of the other ABL Secured Parties for adequate protection of the First Priority Debt or any  adequate protection provided to the ABL Agent or other ABL Secured Parties with respect to the First Priority  Debt or (ii) any objection by the ABL Agent or any of the other ABL Secured Parties to any motion, relief,  action or proceeding based on a claim of a lack of adequate protection for the First Priority Debt or (iii) the  payment of interest, fees, expenses or other amounts to the ABL Agent or any other ABL Secured Party with  respect to the First Priority Debt under Section 506(b) or 506(c) of the Bankruptcy Code or otherwise.  (b) The Collateral Agent, on behalf of itself and the other Noteholder Secured Parties, agrees that  none of them shall seek or accept adequate protection with respect to the Noteholder Debt secured by Liens on  the ABL Collateral without the prior written consent of the ABL Agent; except, that, the Collateral Agent, for  itself or on behalf of the other Noteholder Secured Parties, or the Noteholder Secured Parties shall be permitted  (i) to obtain adequate protection in the form of the benefit of additional or replacement Liens on the ABL  Collateral (including proceeds thereof arising after the commencement of any Insolvency or Liquidation  Proceeding), or additional or replacement ABL Collateral to secure the Noteholder Debt, in connection with any  DIP Financing or use of cash collateral as provided for in Section 6.2 above, or in connection with any such  adequate protection obtained by ABL Agent and the other ABL Secured Parties, as long as in each case, the  ABL Agent is also granted such additional or replacement Liens or additional or replacement ABL Collateral  and such Liens of Collateral Agent or any other Noteholder Secured Party are subordinated to the Liens  securing the ABL Debt to the same extent as the Liens of Collateral Agent and the other Noteholder Secured  Parties on the ABL Collateral are subordinated to the Liens of the ABL Agent and the other ABL Secured  Parties hereunder and (ii) to obtain adequate protection in the form of reports, notices, inspection rights and  similar forms of adequate protection to the extent granted to the ABL Agent.  6.5 Reorganization Securities. If, in any Insolvency or Liquidation Proceeding, debt obligations of any  reorganized Borrower secured by Liens upon any property of such reorganized Borrower are distributed,  pursuant to a plan of reorganization, on account of both the ABL Debt and the Noteholder Debt, then, to the  extent the debt obligations distributed on account of the ABL Debt and on account of the Noteholder Debt are  secured by Liens upon the same assets or property, the provisions of this Intercreditor Agreement will survive  the distribution of such debt obligations pursuant to such plan and will apply with like effect to the Liens  securing such debt obligations.  6.6 Separate Classes. Each of the parties hereto irrevocably acknowledges and agrees that (a) the claims  and interests of the ABL Secured Parties and the Noteholder Secured Parties are not “substantially similar”  within the meaning of Section 1122 of the Bankruptcy Code, or any comparable provision of any other  Bankruptcy Law, (b) the grants of the Liens to secure the ABL Debt and the grants of the Liens to secure the  Noteholder Debt constitute two separate and distinct grants of Liens, (c) the ABL Secured Parties’ rights in the  ABL Collateral are fundamentally different from the Noteholder Secured Parties’ rights in the ABL Collateral  and (d) as a result of the foregoing, among other things, the ABL Debt and the Noteholder Debt must be  separately classified in any plan of reorganization proposed or adopted in any Insolvency or Liquidation  Proceeding.  6.7 Asset Dispositions. Until the Discharge of Priority Debt has occurred, the Collateral Agent, for itself  and on behalf of the other Noteholder Secured Parties, agrees that, in the event of any Insolvency or Liquidation  Proceeding, the Noteholder Secured Parties will not object or oppose (or support any Person in objecting or  opposing) a motion to any sale, lease, license, exchange, transfer or other disposition of any ABL Collateral free  and clear of the Liens of Collateral Agent and the other Noteholder Secured Parties or other claims under  Section 363 of the Bankruptcy Code, or any comparable provision of any Bankruptcy Law and shall be deemed  to have consented to any such any sale, lease, license, exchange, transfer or other disposition of any ABL  Collateral under Section 363(f) of the Bankruptcy Code that has been consented to by the ABL Agent; provided,  that, (a) the proceeds of such sale, lease, license, exchange, transfer or other disposition of any ABL Collateral  to be applied to the ABL Debt or the Noteholder Debt are applied in accordance with Section 4.1. Nothing  herein shall prevent the Collateral Agent or the Noteholder Secured Parties from taking Permitted Actions or  action permitted under Section 3.2 permitted to unsecured creditors.  

 

-16-  6.8 Preference Issues.  (a) If, in any Insolvency or Liquidation Proceeding or otherwise, all or part of any payment with  respect to the First Priority Debt previously made shall be rescinded for any reason whatsoever, then the First  Priority Debt shall be reinstated to the extent of the amount so rescinded and, if theretofore terminated, this  Intercreditor Agreement shall be reinstated in full force and effect and such prior termination shall not diminish,  release, discharge, impair or otherwise affect the Lien priorities and the relative rights and obligations of the  ABL Secured Parties and the Noteholder Secured Parties provided for herein.  (b) If, in any Insolvency or Liquidation Proceeding or otherwise, all or part of any payment with  respect to the Noteholder Debt previously made shall be rescinded for any reason whatsoever and the Discharge  of Priority Debt shall, subject to (for the avoidance of doubt) the immediately preceding clause (a), have  occurred, then the Noteholder Debt shall be reinstated to the extent of the amount so rescinded and, if  theretofore terminated, this Intercreditor Agreement shall be reinstated in full force and effect and such prior  termination shall not diminish, release, discharge, impair or otherwise affect the Lien priorities and the relative  rights and obligations of the Noteholder Secured Parties and any Person that holds ABL Excess Debt provided  for herein solely with respect to any ABL Excess Claims and for the avoidance of doubt, not with respect to any  First Priority Debt.  6.9 Certain Waivers as to Section 1111(b)(2) of Bankruptcy Code. The Collateral Agent, for itself and on  behalf of the other Noteholder Secured Parties, waives any claim any Noteholder Secured Party may hereafter  have against any ABL Secured Party arising out of the election by any ABL Secured Party of the application of  Section 1111(b)(2) of the Bankruptcy Code with respect to any Liens secured by the ABL Collateral, or any  comparable provision of any other Bankruptcy Law. The ABL Agent, for itself and on behalf of the other ABL  Secured Parties, waives any claim any ABL Secured Party may hereafter have against any Noteholder Secured  Party arising out of the election by any Noteholder Secured Party of the application of Section 1111(b)(2) of the  Bankruptcy Code with respect to any Liens secured by the ABL Collateral or any comparable provision of any  other Bankruptcy Law.  6.10 Other Bankruptcy Laws. In the event that an Insolvency of Liquidation Proceeding is filed in a  jurisdiction other than the United States or is governed by any Bankruptcy Law other than the Bankruptcy Code,  each reference in this Intercreditor Agreement to a section of the Bankruptcy Code shall be deemed to refer to  the substantially similar or corresponding provision of the Bankruptcy Law applicable to such Insolvency or  Liquidation Proceeding, or in the absence of any specific similar or corresponding provision of the Bankruptcy  Law, such other general Bankruptcy Law as may be applied in order to achieve substantially the same result as  would be achieved under each applicable section of the Bankruptcy Code.  Section 7. NOTEHOLDER SECURED PARTIES’ PURCHASE OPTION.  7.1 Exercise of Option. On or after the occurrence and during the continuance of an ABL Event of Default  and either the acceleration of all of the ABL Debt or the receipt by Collateral Agent of written notice from the  ABL Agent of its intention to commence a Lien Enforcement Action as provided in Section 7.5 below, the  Noteholder Secured Parties shall have the option at any time within ninety (90) days of such acceleration or  written notice, upon five (5) Business Days’ prior written notice by Collateral Agent to the ABL Agent, to  purchase all (but not less than all) of the ABL Debt from the ABL Secured Parties. Such notice from Collateral  Agent to the ABL Agent shall be irrevocable.  7.2 Purchase and Sale. On the date specified by Collateral Agent in the notice referred to in Section 7.1  (which shall not be less than five (5) Business Days, nor more than twenty (20) days, after the receipt by the  ABL Agent of the notice from Collateral Agent of its election to exercise such option), ABL Secured Parties  shall, subject to any required approval of any court or other regulatory or governmental authority then in effect  (the time to obtain any such approval shall extend the proposed date of sale and purchase), if any, sell to  Noteholder Secured Parties, and Noteholder Secured Parties shall purchase from ABL Secured Parties, all of the  ABL Debt. Notwithstanding anything to the contrary contained herein, in connection with any such purchase  and sale, ABL Secured Parties shall retain all rights under the ABL Documents to be indemnified or held  harmless by the Borrowers in accordance with the terms thereof.  

 

-17-  7.3 Payment of Purchase Price.  (a) Upon the date of such purchase and sale, Noteholder Secured Parties shall (i) pay to the ABL  Agent for the account of the ABL Secured Parties as the purchase price therefor the full amount of all of the  ABL Debt then outstanding and unpaid (including principal, interest, fees and expenses, including reasonable  attorneys’ fees and legal expenses), (ii) furnish cash collateral to ABL Agent in such amounts as ABL Agent  determines is reasonably necessary to secure ABL Secured Parties in connection with any issued and  outstanding letters of credit issued under the ABL Documents (but not in any event in an amount greater than  one hundred five (105%) percent of the aggregate undrawn face amount of such letters of credit) (the ABL  Agent agrees to refund this cash collateral to the Noteholder Secured Parties to the extent any letter of credit  expires or is terminated or any amount is reimbursed from other sources), and (iii) agree to reimburse ABL  Secured Parties for any loss, cost, damage or expense (including reasonable attorneys’ fees and legal expenses)  in connection with any commissions, fees, costs or expenses related to any issued and outstanding letters of  credit as described above and any checks or other payments provisionally credited to the ABL Debt, and/or as to  which ABL Secured Parties have not yet received final payment.  (b) Such purchase price and cash collateral shall be remitted by wire transfer in federal funds to  such bank account of the ABL Agent as the ABL Agent may designate in writing to Collateral Agent for such  purpose. Interest shall be calculated to but excluding the Business Day on which such purchase and sale shall  occur if the amounts so paid by Noteholder Secured Parties to the bank account designated by the ABL Agent  are received in such bank account prior to 12:00 noon, New York City time and interest shall be calculated to  and including such Business Day if the amounts so paid by Noteholder Secured Parties to the bank account  designated by the ABL Agent are received in such bank account later than 12:00 noon, New York City time.  7.4 Representations Upon Purchase and Sale. Such purchase shall be expressly made without  representation or warranty of any kind by ABL Secured Parties as to the ABL Debt, the ABL Collateral or  otherwise and without recourse to ABL Secured Parties, except that each ABL Secured Party shall represent and  warrant, severally, as to it: (a) the amount of the ABL Debt being purchased from it are as reflected in the books  and records of such ABL Secured Party (but without representation or warranty as to the collectibility, validity  or enforceability thereof), (b) that such ABL Secured Party owns the ABL Debt being sold by it free and clear  of any liens or encumbrances and (c) such ABL Secured Party has the right to assign the ABL Debt being sold  by it and the assignment is duly authorized. Upon the purchase by Noteholder Secured Parties of the ABL Debt,  Noteholder Secured Parties agree to indemnify and hold ABL Secured Parties harmless from and against all  loss, cost, damage or expense (including reasonable attorneys’ fees and legal expenses) suffered or incurred by  ABL Secured Parties arising from or in any way relating to acts or omissions of Collateral Agent or any of the  other Noteholder Secured Parties after the purchase. Subject to the foregoing, ABL Secured Parties shall  execute and deliver such instruments of transfer and other documents as shall be necessary or desirable to fully  vest title to the ABL Debt in the Noteholder Secured Parties (or their designee) and to effectively transfer all  Liens securing the ABL Debt to the Noteholder Secured Parties (or their designee).  7.5 Notice from the ABL Agent Prior to Lien Enforcement Action. The ABL Agent agrees that it will give  Collateral Agent ten (10) Business Days prior written notice of its intention to commence a Lien Enforcement  Action. In the event that during such ten (10) Business Day period, Collateral Agent shall send to the ABL  Agent the irrevocable notice of the intention of the Noteholder Secured Parties to exercise the purchase option  given by ABL Secured Parties to Noteholder Secured Parties under this Section 7, ABL Secured Parties shall  not commence any foreclosure or other action to sell or otherwise realize upon the ABL Collateral, provided,  that, the purchase and sale with respect to the ABL Debt provided for herein shall have closed within thirty (30)  Business Days thereafter and ABL Secured Parties shall have received final payment in full of the ABL Debt as  provided for herein within such thirty (30) Business Day period.  Section 8. RELIANCE; WAIVERS; ETC.  8.1 Reliance. The consent by the ABL Secured Parties to the execution and delivery of the Noteholder  Documents and the grant to the Collateral Agent on behalf of the Noteholder Secured Parties of a Lien on the  ABL Collateral and all loans and other extensions of credit made or deemed made on and after the date hereof  by the Noteholder Secured Parties to any Borrower shall be deemed to have been given and made in reliance  upon this Intercreditor Agreement.  8.2 No Warranties or Liability. The Collateral Agent, for itself and on behalf of the other Noteholder  

 

-18-  Secured Parties, acknowledges and agrees that each of the ABL Agent and the other ABL Secured Parties have  made no express or implied representation or warranty, including with respect to the execution, validity,  legality, completeness, collectibility or enforceability of any of the ABL Documents, the ownership of any ABL  Collateral or the perfection or priority of any Liens thereon. The Collateral Agent agrees, for itself and on behalf  of the other Noteholder Secured Parties, that the ABL Secured Parties will be entitled to manage and supervise  their respective loans and extensions of credit under the ABL Documents in accordance with law and as they  may otherwise, in their sole discretion, deem appropriate, and the ABL Secured Parties may manage their loans  and extensions of credit without regard to any rights or interests that the Collateral Agent or any of the other  Noteholder Secured Parties have in the ABL Collateral or otherwise, in each case except as otherwise provided  in this Intercreditor Agreement. The ABL Agent, for itself and on behalf of the ABL Secured Parties,  acknowledges and agrees that neither the Collateral Agent nor any other Noteholder Secured Party has made  any express or implied representation or warranty, including with respect to the execution, validity, legality,  completeness, collectibility or enforceability of any of the Noteholder Documents, the ownership of any ABL  Collateral or the perfection of priority of any Liens thereon. The ABL Agent agrees, for itself and on behalf of  the other ABL Secured Parties, that the Collateral Agent and the Noteholder Secured Parties will be entitled to  manage the Noteholder Debt under the Noteholder Documents in accordance with law and as they may  otherwise, in their sole discretion, deem appropriate, and the Collateral Agent and the Noteholder Secured  Parties may manage their Noteholder Debt without regard to any rights or interests that the ABL Agent or any  of the other ABL Secured Parties have in the ABL Collateral or otherwise, in each case except as otherwise  provided in this Intercreditor Agreement. Neither the ABL Agent nor any of the other ABL Secured Parties shall  have any duty to the Collateral Agent or any of the other Noteholder Secured Parties, and neither the Collateral  Agent or any of the other Noteholder Secured Parties shall have any duty to the ABL Agent or any of the ABL  Secured Parties, to act or refrain from acting in a manner which allows, or results in, the occurrence or  continuance of an event of default or default under any agreements with any Borrower (including the  Noteholder Documents or any ABL Documents), regardless of any knowledge thereof which they may have or  be charged with.  8.3 No Waiver of Lien Priorities.  (a) No right of the ABL Agent or any of the other ABL Secured Parties or of the Collateral Agent  or the Noteholder Secured Parties to enforce any provision of this Intercreditor Agreement or any of the ABL  Documents or Noteholder Documents, as the case may be, shall at any time in any way be prejudiced or  impaired by any act or failure to act on the part of any Borrower, or by any noncompliance by any Person with  the terms, provisions and covenants of this Intercreditor Agreement, any of the ABL Documents or any of the  Noteholder Documents, regardless of any knowledge thereof which the ABL Agent or any of the other ABL  Secured Parties or the Collateral Agent or the Noteholder Secured Parties may have or be otherwise charged  with.  (b) Without in any way limiting the generality of the foregoing paragraph (but subject to the  rights of the Borrowers under the ABL Documents and the rights of the Noteholder Secured Parties under the  Noteholder Documents), the ABL Agent and any of the other ABL Secured Parties may, at any time and from  time to time, without the consent of, or notice to, the Collateral Agent or any other Noteholder Secured Party,  without incurring any liabilities to the Collateral Agent or any other Noteholder Secured Party and without  impairing or releasing the Lien priorities and other benefits provided in this Intercreditor Agreement (even if  any right of subrogation or other right or remedy of the Collateral Agent or any other Noteholder Secured Party  is affected, impaired or extinguished thereby) do any one or more of the following:  (i) change the manner, place or terms of payment or change or extend the time of  payment of, or amend, renew, exchange, increase or alter, the terms of any of the ABL Debt or any Lien on any  ABL Collateral or guaranty thereof or any liability of any Borrower, or any liability incurred directly or  indirectly in respect thereof (including any increase in or extension of the ABL Debt, without any restriction as  to the amount, tenor or terms of any such increase or extension, and including addition of Vector Tobacco Inc.  and any other Affiliate of the Issuer as a “Borrower” under and as defined in the ABL Loan Agreement) or  otherwise amend, renew, exchange, extend, modify or supplement in any manner any Liens held by the ABL  Agent or any of the other ABL Secured Parties, the ABL Debt or any of the ABL Documents; except that the  ABL Agent and the ABL Secured Parties may not consent to any amendment, modification or waiver to the  ABL Documents that:  (A) results in the sum of (1) the aggregate principal amount of loans outstanding  under the ABL Documents, plus (2) the unused portion of the revolving commitments under the ABL  

 

-19-  Documents, plus (3) the aggregate face amount of all letters of credit issued or deemed issued and outstanding  under the ABL Documents plus (4) the Cash Management Obligations plus the Hedging Obligations (in the case  of each of the foregoing, as determined after giving effect to such amendment, modification or waiver)  exceeding $120,000,000,  (B) increase the “Applicable Margins” or similar component of the interest rate  under the ABL Loan Agreement in a manner that would result in the total yield on the ABL Date to exceed by  more than two (2%) percent per annum the total yield on the ABL Debt as in effect on the date hereof  (excluding increases resulting from the accrual or payment of interest at the default rate),  (C) modify or add any covenant or event of default under the ABL Documents  that directly restricts any Borrower from making mandatory payments of the Noteholder Debt that would  otherwise be permitted under the ABL Documents (as in effect on the date hereof),  (D) contractually subordinates the Liens of the ABL Secured Parties to any  other debt of the Borrowers except as permitted herein or in the ABL Documents (as in effect on the date  hereof), or  (E) contravene the provisions of this Intercreditor Agreement;  (ii) until the Discharge of Priority Debt, sell, exchange, release, surrender, realize upon,  enforce or otherwise deal with in any manner and in any order any part of the ABL Collateral or any liability of  any Borrower to the ABL Agent or any of the other ABL Secured Parties, or any liability incurred directly or  indirectly in respect thereof in accordance with the terms hereof;  (iii) settle or compromise any of the ABL Debt or any other liability of any Borrower or  any security therefor or any liability incurred directly or indirectly in respect thereof and apply any sums by  whomsoever paid and however realized to any liability (including the ABL Debt) in any manner or order, but  subject however to the terms of this Intercreditor Agreement; and  (iv) exercise or delay in or refrain from exercising any right or remedy against any  Borrower or any other Person, elect any remedy and otherwise deal freely with any Borrower or any ABL  Collateral and any security and any guarantor or any liability of any Borrower to any of the ABL Secured  Parties or any liability incurred directly or indirectly in respect thereof, but subject however to the terms of this  Intercreditor Agreement.  (c) Each of the Collateral Agent and the ABL Agent agrees not to assert and hereby waives, to the  fullest extent permitted by law, any right to demand, request, plead or otherwise assert or otherwise claim the  benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under  applicable law with respect to the ABL Collateral or any other similar rights a junior secured creditor may have  under applicable law with respect to the ABL Collateral.  Section 9. JOINDER.  9.1 Joinder of Other Borrowers.  Any Person that is an Affiliate of the Issuer and an Indenture Loan Party  and is added as a “Borrower” (as defined in the ABL Loan Agreement) shall become a party hereto as an Other  Borrower by executing and delivering a Joinder Agreement.  Section 10. MISCELLANEOUS.  10.1 Conflicts; Additional Security. In the event of any conflict between the provisions of this Intercreditor  Agreement and the provisions of the ABL Documents or the Noteholder Documents, the provisions of this  Intercreditor Agreement shall govern.  10.2 Continuing Nature of this Intercreditor Agreement; Severability. This Agreement shall continue to be  effective until the earlier of (a) the Discharge of ABL Debt or (b) the final payment in full in cash of the  Noteholder Debt and the termination and release by each Noteholder Secured Party of any Liens to secure the  Noteholder Debt. This is a continuing agreement of Lien subordination and the ABL Secured Parties may  continue, at any time and without notice to the Collateral Agent or any other Noteholder Secured Party, to  

 

-20-  extend credit and other financial accommodations and lend monies to or for the benefit of any Borrower  constituting ABL Debt in reliance hereon and the Noteholder Secured Parties may purchase Notes constituting  Noteholder Debt in reliance hereon. Each of the Collateral Agent, for itself and on behalf of the Noteholder  Secured Parties, and the ABL Agent, for itself and on behalf of the ABL Secured Parties, hereby waives any  right it may have under applicable law to revoke this Intercreditor Agreement or any of the provisions of this  Intercreditor Agreement. The terms of this Intercreditor Agreement shall survive, and shall continue in full force  and effect, in any Insolvency or Liquidation Proceeding. Any provision of this Intercreditor Agreement which is  prohibited or unenforceable in any jurisdiction shall not invalidate the remaining provisions hereof, and any  such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such  provision in any other jurisdiction.  10.3 When Discharge of ABL Debt and Discharge of Priority Noteholder Debt Deemed to Not Have  Occurred.   (a) If substantially contemporaneously with the Discharge of ABL Debt, any Borrower refinances  indebtedness outstanding under the ABL Documents, then after written notice to Collateral Agent, (i) the  indebtedness and other obligations arising pursuant to such refinancing of the then outstanding indebtedness  under the ABL Documents shall automatically be treated as ABL Debt for all purposes of this Intercreditor  Agreement, including for purposes of the Lien priorities and rights in respect of ABL Collateral set forth herein,  provided that such indebtedness would have been a permitted modification or amendment under Section 8.3(b)  hereof, (ii) the credit agreement and the other loan documents evidencing such new indebtedness shall  automatically be treated as the ABL Loan Agreement and the ABL Documents for all purposes of this  Intercreditor Agreement and (iii) the administrative agent under the new ABL Loan Agreement shall be deemed  to be the ABL Agent for all purposes of this Intercreditor Agreement.  (b) If substantially contemporaneously with the Discharge of Priority Noteholder Debt, any  Borrower refinances indebtedness outstanding under the Noteholder Documents, then after written notice to the  ABL Agent, (i) the indebtedness and other obligations arising pursuant to such refinancing of the then  outstanding indebtedness under the Noteholder Documents shall automatically be treated as Noteholder Debt for  all purposes of this Intercreditor Agreement, including for purposes of the Lien priorities and rights in respect of  ABL Collateral set forth herein, provided that such indebtedness would have been a permitted modification or  amendment under this Intercreditor Agreement, (ii) the credit agreement or indenture and the other loan or note  documents evidencing such new indebtedness shall automatically be treated as the Noteholder Agreement and  the Noteholder Documents for all purposes of this Intercreditor Agreement and (iii) the administrative agent or  trustee under the new Noteholder Agreement shall be deemed to be the Collateral Agent for all purposes of this  Intercreditor Agreement.  10.4 Amendments to Noteholder Documents. Without the prior written consent of the ABL Agent, no  Noteholder Document may be amended, supplemented or otherwise modified, and no new Noteholder  Document may be entered into, to the extent such amendment, supplement or other modification or new  document would contravene the provisions of this Intercreditor Agreement.  10.5 Amendments; Waivers. No amendment, modification or waiver of any of the provisions of this  Intercreditor Agreement by the Collateral Agent or the ABL Agent shall be deemed to be made unless the same  shall be in writing signed on behalf of the party making the same or its authorized agent and each waiver, if any,  shall be a waiver only with respect to the specific instance involved and shall in no way impair the rights of the  parties making such waiver or the obligations of the other parties to such party in any other respect or at any  other time. The Borrowers shall not have any right to consent to or approve any amendment, modification or  waiver of any provision of this Intercreditor Agreement except to the extent their rights or obligations are  directly affected.  Notwithstanding this Section 10.5, without the consent of the Collateral Agent or any other  party hereto, any Other Borrower may become a party hereto by execution and delivery of a Joinder Agreement  in accordance with Section 9, and upon such execution and delivery, such Other Borrower shall be subject to the  terms hereof and be treated as a “Borrower” hereunder.  10.6 Subrogation; Marshalling.  (a) The Collateral Agent agrees that no payment or distribution to any ABL Secured Party  pursuant to the provisions of this Intercreditor Agreement shall entitle any Noteholder Secured Party to exercise  any rights of subrogation in respect thereof until the Discharge of Priority Debt shall have occurred. Following  

 

-21-  the Discharge of Priority Debt, each the ABL Agent agrees to execute such documents, agreements, and  instruments as the Collateral Agent or any Noteholder Secured Party may reasonably request to evidence the  transfer by subrogation to any the Collateral Agent, for the benefit of the Noteholder Secured Parties, of an  interest in the First Priority Debt resulting from payments or distributions to such ABL Secured Party by such  Person, so long as all reasonable costs and expenses (including all reasonable legal fees and disbursements)  incurred in connection therewith by such ABL Secured Party are paid by such Person upon request for payment  thereof.  (b) The Noteholder Secured Parties hereby waive any and all rights to have any ABL Collateral  or any part thereof granted to or held by the ABL Agent marshaled upon any foreclosure or other disposition of  such ABL Collateral by the ABL Agent or any Borrower without the consent of the ABL Agent, and ABL  Secured Parties hereby waive any and all rights to have any ABL Collateral or any part thereof granted to or  held by the Collateral Agent or any other Noteholder Secured Party marshaled upon any foreclosure or other  disposition of such ABL Collateral by the Collateral Agent or any Noteholder Secured Party or any Borrower  without the consent of Noteholder Secured Parties, in each case subject to the other terms of this Intercreditor  Agreement.  10.7 Consent to Jurisdiction; Waivers. The parties hereto consent to the jurisdiction of any state or federal  court located in New York, New York, and consent that all service of process may be made by registered mail  directed to such party as provided in Section 10.9 below for such party. The parties hereto waive any objection  to any action instituted hereunder based on forum non conveniens, and any objection to the venue  of any action  instituted hereunder. Each of the parties hereto waives any right it may have to trial by jury in respect of any  litigation based on, or arising out of, under or in connection with this Intercreditor Agreement, or any course of  conduct, course of dealing, verbal or written statement or action of any party hereto.  10.8 Notices. All notices to the Noteholder Secured Parties and the ABL Secured Parties permitted or  required under this Intercreditor Agreement may be sent to the Collateral Agent and the ABL Agent,  respectively. Unless otherwise specifically provided herein, any notice or other communication herein required  or permitted to be given shall be in writing and may be personally served, electronically mailed or sent by  courier service, facsimile transmission or U.S. mail and shall be deemed to have been given when delivered in  person or by courier service, upon receipt of a facsimile transmission or electronic mail or four (4) Business  Days after deposit in the U.S. mail (registered or certified, with postage prepaid and properly addressed). For the  purposes hereof, the addresses of the parties hereto shall be as set forth below, or, as to each party, at such other  address as may be designated by such party in a written notice to all of the other parties.  Collateral Agent:  U.S. Bank National Association  Global Corporate Trust Services  60 Livingstone Avenue  EP-MN-WS3C  St. Paul, Minnesota 55107-2292  Attention: Joshua A. Hahn  Facsimile No.: 651-466-7430  ABL Agent:  Wells Fargo Bank, National Association  100 Park Avenue, 14th Floor  New York, New York 10017  MAC J0149-030  Attention: Portfolio Manager – Liggett   Facsimile No.: 212-545-4283  Each Initial Borrower:  Liggett Group LLC  100 Maple LLC  c/o Liggett Vector Brands LLC  3800 Paramount Parkway, Suite 250  

 

-22-  Morrisville, North Carolina 27560   Attention: Victoria Spier Evans   Facsimile No.: 919-990-3590  with a copy to:  Vector Group Ltd.  4400 Biscayne Boulevard, 10th Floor  Miami, Florida 33137-3212   Attention: Marc Bell  Facsimile No.: 305-579-8016  Each Other Borrower:  Vector Group Ltd.  4400 Biscayne Boulevard, 10th Floor  Miami, Florida 33137-3212   Attention: Marc Bell  Facsimile No.: 305-579-8016  with a copy to:  Vector Group Ltd.  4400 Biscayne Boulevard, 10th Floor  Miami, Florida 33137-3212   Attention: Bryant Kirkland  Facsimile No.: 305-579-8046  10.9 Further Assurances.  (a) The Collateral Agent agrees that it shall, for itself and on behalf of the Noteholder Secured  Parties, take such further action and shall execute and deliver to the ABL Agent such additional documents and  instruments (in recordable form, if requested) as the ABL Agent may reasonably request to effectuate the terms  of and the lien priorities contemplated by this Intercreditor Agreement.  (b) The ABL Agent agrees that it shall, for itself and on behalf of the ABL Secured Parties, take  such further action and shall execute and deliver to the Collateral Agent such additional documents and  instruments (in recordable form, if requested) as the Collateral Agent may reasonably request to effectuate the  terms of and the lien priorities contemplated by this Intercreditor Agreement.  10.10 Consent to Jurisdiction; Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY  IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE SUPREME COURT  OF THE STATE OF NEW YORK IN NEW YORK COUNTY AND THE UNITED STATES DISTRICT  COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND WAIVES TRIAL BY JURY IN ANY  ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT.  10.11 Governing Law. The validity, construction and effect of this Intercreditor Agreement shall be  governed by the internal laws of the State of New York but excluding any principles of conflicts of law or any  other rule of law that would result in the application of the law of any jurisdiction other than the laws of the  State of New York.  10.12 Binding on Successors and Assigns. This Agreement shall be binding upon the ABL Agent,  the other ABL Secured Parties, the Collateral Agent, the other Noteholder Secured Parties, the Borrowers and  their respective permitted successors and assigns.  10.13 Specific Performance. The ABL Agent or the Collateral Agent may demand specific  performance of this Intercreditor Agreement. The Collateral Agent, for itself and on behalf of the Noteholder  Secured Parties, and the ABL Agent, for itself and on behalf of the ABL Secured Parties, hereby irrevocably  waives any defense based on the adequacy of a remedy at law and any other defense which might be asserted to  

 

-23-  bar the remedy of specific performance in any action which may be brought by the ABL Agent or the Collateral  Agent, as applicable.  10.14 Section Titles; Time Periods. The section titles contained in this Intercreditor Agreement are  and shall be without substantive meaning or content of any kind whatsoever and are not a part of this  Intercreditor Agreement.  10.15 Counterparts. This Agreement may be executed in one or more counterparts, each of which  shall be an original and all of which shall together constitute one and the same document. The words  “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to this Agreement or any  document to be signed in connection with this Agreement shall be deemed to include electronic signatures,  deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity  or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based  recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the  Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures  and Records Act or any other similar state laws based on the Uniform Electronic Transactions Act, and the  parties hereto consent to conduct the transactions contemplated hereunder by electronic means.  10.16 Authorization. By its signature, each Person executing this Intercreditor Agreement on behalf  of a party hereto represents and warrants to the other parties hereto that it is duly authorized to execute this  Intercreditor Agreement.  10.17 No Third Party Beneficiaries. This Agreement and the rights and benefits hereof shall inure to  the benefit of each of the parties hereto and their respective successors and assigns and shall inure to the benefit  of each of the holders of ABL Debt and Noteholder Debt. No other Person shall have or be entitled to assert  rights or benefits hereunder.  [SIGNATURE PAGES FOLLOW] 

 

[Signature Page to Intercreditor and Lien Subordination Agreement]  IN WITNESS WHEREOF, the parties hereto have executed this Intercreditor Agreement as of the date  first written above.  ABL AGENT:    WELLS FARGO BANK, NATIONAL  ASSOCIATION, as ABL Agent      By: /s/ Andrew Rogow  Name: Andrew Rogow  Title: Vice President     

 

[Signature Page to Intercreditor and Lien Subordination Agreement]    BORROWERS:    LIGGETT GROUP LLC      By: /s/ Nicholas P. Anson  Name: Nicholas P. Anson  Title: President and Chief Operating Officer     100 MAPLE LLC      By: /s/ Victoria Spier Evans  Name: Victoria Spier Evans  Title: Secretary    COLLATERAL AGENT:    U.S. BANK NATIONAL ASSOCIATION, as the  Collateral Agent      By: /s/ Joshua A. Hahn  Name: Joshua A. Hahn  Title: Vice President  

 

  EXHIBIT A   FORM OF JOINDER AGREEMENT  JOINDER AGREEMENT NO. [●] (the “Joinder”), dated as of [●], 20[●], to the SECOND  AMENDED AND RESTATED INTERCREDITOR AND LIEN SUBORDINATION AGREEMENT, dated as  of January 28, 2021 (the “Intercreditor Agreement”), among Wells Fargo Bank, National Association, in its  capacity as administrative agent (in such capacity, the “ABL Agent”), for itself and on behalf of the other ABL  Secured Parties, U.S. Bank National Association, in its capacity as collateral agent for the Noteholder Secured  Parties (in such capacity, the “Collateral Agent”), Liggett Group LLC, a Delaware limited liability company (  “Liggett Group”), 100 Maple LLC, a Delaware limited liability company (“100 Maple” and, together with  Liggett Group, the “Initial Borrowers”) and each other borrower under the ABL Loan Agreement that becomes  party thereto pursuant to a Joinder Agreement (each, an “Other Borrower” and, together with the Initial  Borrowers and each other Other Borrower, the “Borrowers” and each individually, a “Borrower”).    A. Capitalized terms used herein but not otherwise defined herein shall have the meanings assigned  to such terms in the Intercreditor Agreement.  B. Section 9 of the Intercreditor Agreement provides that an Other Borrower may become a party  to the Intercreditor Agreement upon the execution and delivery by such Other Borrower of an instrument  substantially in the form of this Joinder.  The undersigned Other Borrower (the “New Other Borrower”) is  executing this Joinder in accordance with the requirements of the Intercreditor Agreement.  Accordingly, the New Other Borrower agrees as follows:    SECTION 1. In accordance with Section 9 of the Intercreditor Agreement, the undersigned New  Other Borrower by its signature below becomes an Other Borrower under the Intercreditor Agreement with the  same force and effect as if the New Other Borrower had originally been named therein as a Borrower, and the  New Other Borrower hereby agrees to all the terms and provisions of the Intercreditor Agreement applicable to it  as a Borrower.  Each reference to a “Borrower” in the Intercreditor Agreement shall be deemed to include the  New Other Borrower.  The Intercreditor Agreement is hereby incorporated herein by reference.  SECTION 2. The New Other Borrower represents and warrants to the ABL Agent and the Collateral  Agent that (i) it has full power and authority to enter into this Joinder and (ii) this Joinder has been duly authorized,  executed and delivered by it and constitutes its legal, valid and binding obligation, enforceable against it in  accordance with its the terms.  SECTION 3. This Joinder 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 Joinder shall become  effective when the ABL Agent and the Collateral Agent shall have received a counterpart of this Joinder that bears  the signature of the New Other Borrower.  Delivery of an executed signature page to this Joinder by facsimile  transmission shall be effective as delivery of a manually signed counterpart of this Joinder.  SECTION 4. Except as expressly supplemented hereby, the Intercreditor Agreement shall remain in  full force and effect.  SECTION 5. The validity, construction and effect of this Joinder shall be governed by the internal  laws of the State of New York but excluding any principles of conflicts of law or any other rule of law that would  result in the application of the law of any jurisdiction other than the laws of the State of New York.  SECTION 6. All communications and notices hereunder shall be in writing and given as provided  in Section 10.8 of the Intercreditor Agreement.  All communications and notices hereunder to the New Other  Borrower shall be given to it at the address set forth below its signature hereto.  

 

[Signature Page to Joinder Agreement to Intercreditor and Lien Subordination Agreement]      IN WITNESS WHEREOF, the New Other Borrower has duly executed this Joinder to the Intercreditor  Agreement as of the day and year first above written.    [NAME OF NEW OTHER BORROWER]  By :      Name:    Title:    Address for notices:   ________________________________   ________________________________  attention of: ____________________________  Facsimile: ______________________________

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