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EXHIBIT 4.7
INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT
INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT dated as of this
17th day of June, 1997, by and among UNITED STATES TRUST COMPANY OF NEW YORK,
as Trustee for its own benefit and for the benefit of the Holders (as
hereinafter defined) under the Indenture (as hereinafter defined) (in such
capacity, the "Trustee"), BANK OF AMERICA ILLINOIS, as Administrative Agent for
its own benefit and for the benefit of the lenders under the Term Loan
Agreement (as hereinafter defined) (in such capacity, the "Term Loan Agent"),
BANK OF AMERICA ILLINOIS, as Agent under the Bank Credit Agreement (as
hereinafter defined) (in such capacity, the "Agent Bank"), UNITED STATES TRUST
COMPANY OF NEW YORK, as collateral agent (the "Collateral Agent"), PIONEER
AMERICAS ACQUISITION CORP. ("PAAC"), PIONEER AMERICAS, INC. ("PAI") and
PIONEER CHLOR ALKALI COMPANY, INC. ("PCAC"; and together with PAAC and PAI
sometimes hereinafter referred to collectively as the "Companies").
Recitals
A. Pursuant to that certain Indenture dated as of the
date hereof (as the same may be amended, amended and restated, supplemented or
otherwise modified from time to time, the "Indenture") among PAAC, the
Subsidiary Guarantors (as defined therein) and the Trustee, as trustee for the
holders of the Notes (as hereinafter defined) (the "Holders"), PAAC will issue
its 9 1/4% Senior Secured Notes due 2007 (as the same may be amended, amended
and restated, supplemented or otherwise modified from time to time, including
all notes issued in exchange or substitution therefor, upon the registration of
such notes pursuant to the Securities Act of 1933 or otherwise, the "Notes") in
the aggregate principal amount of $200 million.
B. Pursuant to that certain Loan Agreement dated as of
the date hereof (as the same may be amended, amended and restated, supplemented
or otherwise modified from time to time, the "Term Loan Agreement") among PAAC,
the Term Loan Agent, DLJ Capital Funding, Inc., as syndication agent, Salomon
Brothers Holding Company Inc, as documentation agent, and the lenders
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named therein (the "Term Loan Lenders"), the Term Loan Lenders will make loans
to PAAC to be evidenced by notes (as the same may be amended, amended and
restated, supplemented or otherwise modified from time to time, including all
notes issued in exchange or substitution therefor, the "Term Loan Notes") in an
aggregate principal amount of $100 million.
C. PAAC has entered into a Loan and Security Agreement,
dated as of the date hereof (as in effect on the date hereof, the "Bank Credit
Agreement"), among PAAC, as borrower, the Agent Bank, as agent and a lender,
and the other lenders party thereto, under which the Agent Bank and such other
lenders (collectively, the "Bank Lenders") agreed to provide certain revolving
loan and letter of credit facilities to PAI in an aggregate principal or face
amount not in excess of $35 million.
D. Pursuant to Article Thirteen of the Indenture, PCAC
has guaranteed (such guarantee by PCAC being hereinafter referred to as the
"Note Guarantee") the payment and performance of the Indenture Obligation (as
hereinafter defined).
E. Pursuant to the Subsidiary Guaranty dated as of the
date hereof (as the same may be amended, amended and restated, supplemented or
otherwise modified from time to time), PCAC has guaranteed (such guarantee by
PCAC being hereinafter referred to as the "Term Loan Guarantee") the payment
and performance of the Term Loan Obligation (as hereinafter defined).
F. PCAC has executed and delivered the following
documents (those listed in clauses (i), (ii) and (iii) of this paragraph F,
collectively, and as amended, amended and restated, supplemented or otherwise
modified from time to time, the "Mortgages") to the Collateral Agent to secure
the payment and performance of its obligations under the Note Guarantee and the
Term Loan Guarantee:
(i) First Priority Deed of Trust, Assignment of Leases and
Rents, Security Agreement, Fixture Filing and Financing Statement dated as of
the date hereof in respect of certain premises in Tacoma, Washington and
further described on Schedule 1 hereto by PCAC, as trustor, to Transnation
Title Insurance Company, as Deed of Trust Trustee, for the benefit of
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the Collateral Agent, as beneficiary, for the benefit of the Trustee, the Term
Loan Agent, the Holders and the Term Loan Lenders;
(ii) First Priority Deed of Trust, Assignment of Leases
and Rents, Security Agreement, Fixture Filing and Financing Statement dated as
of the date hereof in respect of certain premises in Henderson, Nevada and
further described on Schedule 2 hereto by PCAC, as trustor, to First American
Title Insurance Company of Nevada, as Deed of Trust Trustee, for the benefit of
the Collateral Agent, as beneficiary, for the benefit of the Trustee, the Term
Loan Agent, the Holders and the Term Loan Lenders;
(iii) First Priority Mortgage, Assignment of Leases and
Rents, Security Agreement, Fixture Filing and Financing Statement dated as of
the date hereof in respect of certain premises in St. Gabriel, Louisiana and
further described on Schedule 3 hereto by PCAC, as mortgagor, to the Collateral
Agent, as mortgagee, for the benefit of the Trustee, the Term Loan Agent, the
Holders and the Term Loan Lenders;
(iv) Security Agreement (as the same may be amended, amended and
restated, supplemented or otherwise modified from time to time, the "Security
Agreement") dated as of the date hereof by PCAC, as debtor, to the Collateral
Agent, as secured party, in respect of certain agreements related to PCAC's
facility in Tacoma, Washington; and
(v) Stock Pledge Agreement (as the same may be amended,
amended and restated, supplemented or otherwise modified from time to time, the
"Stock Pledge Agreement") from PAI, as debtor, to the Collateral Agent, as
secured party, in respect of all of the issued and outstanding stock owned by
PAI of PCAC and All-Pure Chemical Co.
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A g r e e m e n t :
The parties agree as follows:
ARTICLE 1
DEFINITIONS
Definitions. (a) Capitalized terms that are not otherwise
defined herein are used herein with the meanings given thereto in the Mortgages
as in effect on the date of execution of this Agreement.
(b) The following terms shall have the respective meanings
set forth below:
"Collateral" means the Mortgaged Property, the Collateral (as
defined in the Security Agreement), the Collateral (as defined in the Stock
Pledge Agreement), the New Collateral and any other property or assets which
may from time to time be subject to one or more of the Liens evidenced or
created by any of the Collateral Documents.
"Collateral Account" has the meaning set forth in Section 5.1.
"Collateral Agent's Fees" means all fees, costs and expenses
of the Collateral Agent of the type described in Sections 7.3, 7.4, 7.5 and
7.6.
"Collateral Documents" means, collectively, (i) the Mortgages,
(ii) the Security Agreement, (iii) the Stock Pledge Agreement, (iv) this
Intercreditor and Collateral Agency Agreement, (v) the documentation relating
to the Collateral Account and (vi) all security agreements, mortgages, deeds of
trust, pledges, collateral assignments or any other instruments evidencing or
creating any security interest in favor of the Collateral Agent for the benefit
of the Secured Parties in all or any portion of any property or assets of any
Obligor, in each case as amended, supplemented or otherwise modified from time
to time.
"Companies" has the meaning set forth in the first paragraph
of this Agreement.
"Debt Instrument" means each of the Notes and the Term Loan
Notes.
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"Default" means a Default under the Term Loan Agreement or
under the Indenture, as the case may be.
"Distribution Date" means the date on which any funds are
distributed by the Collateral Agent in accordance with the provisions of
Section 6.1.
"Enforcement Notice" has the meaning set forth in Section
2.2(a).
"Event of Default" means an Event of Default under the Term
Loan Agreement or under the Indenture, as the case may be.
"Indenture Obligation" has the meaning set forth in the
Mortgages.
"Majority Holders" means the holders of Debt Instruments which
in principal amount constitute more than 50% of the Total Amount of Secured
Obligations; provided, however, that for purposes of this definition there
shall not be counted any interests in any Debt Instrument (A) for which (and to
the extent that) there are at such time on deposit with the Collateral Agent,
or the Trustee or the Term Loan Agent, as the case may be, amounts to be
applied to the payment of principal thereof or (B) which are held by any of the
Companies or any Affiliate (as defined in the Indenture as in effect on the
date hereof) of any of the Companies.
"New Collateral" shall mean any Collateral pledged to the
Collateral Agent pursuant to stock pledge agreements executed and delivered
pursuant to Section 1017 of the Indenture or Section 7.1.9 of the Term Loan
Agreement.
"Note Majority Holders" shall mean the holders of the Notes
which in principal amount constitute more than 50% of the Indenture Obligation
provided that for purposes for this definition, there shall not be counted any
interest in the Notes (i) for which (and to the extent that) there are at such
time on deposit with the Collateral Agent or the Trustee amounts to be applied
to the payment of principal thereof or (ii) which are held by any of the
Companies or any Affiliate of any of the Companies.
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"Obligor" means PCAC, PAI and any other mortgagor, pledgor or
assignor under a Collateral Document.
"Officers' Certificate" has the meaning set forth in the
Indenture as in effect on the date hereof.
"Opinion of Counsel" has the meaning set forth in the
Indenture as in effect on the date hereof.
"Pro Rata Share" with respect to any Secured Party means, at
any date of determination thereof, the percentage derived by dividing (i) the
total, without duplication, of all outstanding Indenture Obligation or Term
Loan Obligation, as the case may be (whether by virtue of acceleration or
otherwise) under or in respect of the Debt Instruments held or administered by
such Secured Party, including all fees, expenses and other amounts owing to the
Trustee or the Term Loan Agent, less the amount of any cash collateral on
deposit with the Trustee or the Term Loan Agent, as the case may be, with
respect thereto, by (ii) the Total Amount of Secured Obligations.
"Real Property" means any interest in any real property or any
portion thereof, whether owned in fee or leased or otherwise owned.
"Secured Obligations" means, at any time, the obligations of
the Companies from time to time under or in respect of the Debt Instruments.
"Secured Party" means each of the Trustee (acting for its own
benefit and for the benefit of the Holders) and the Term Loan Agent (acting for
its own benefit and for the benefit of the Term Loan Lenders), and their
respective successors and assigns.
"Survey" means a survey of any parcel of real property (and
all improvements thereon): (i) prepared by a surveyor or engineer licensed to
perform surveys in the state in which such property is located, (ii) dated (or
redated) not earlier than six months prior to the date of delivery thereof
(unless there shall have occurred within six months prior to such date of
delivery any exterior construction on the site of such property, in which event
such survey shall be dated (or redated) to a date after the
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completion of such construction, (iii) certified by the surveyor (in a manner
reasonably acceptable to the title company providing title insurance in respect
of the Liens of the Collateral Documents) and (iv) complying in all respects
with the minimum detail requirements of the American Land Title Association, or
local equivalent, as such requirements are in effect on the date of preparation
of such survey.
"Term Loan Collateral Proceeds" shall have the meaning set
forth in Section 3.2(b)(iv) hereof.
"Term Loan Note Majority Holders" shall mean the holders of
the Term Loan Notes which in principal amount constitute more than 50% of the
Term Loan Obligation, provided that for purposes of this definition there shall
not be counted any interest in the Term Loan Notes (i) for which (and to the
extent that) there are at such time on deposit with the Collateral Agent or the
Term Loan Agent amounts to be applied to the payment of principal thereof and
(ii) which are held by any of the Companies or any Affiliate of any of the
Companies.
"Term Loan Obligation" has the meaning set forth in the
Mortgages.
"Title Policies" means the mortgagee policies of title
insurance delivered to the Collateral Agent and insuring the lien of the
Mortgages.
"Total Amount of Secured Obligations" means, at any time, the
total, without duplication, of all amounts then outstanding under or in respect
of each of the Debt Instruments less, in each case, the amount of cash
collateral on deposit with the Trustee or the Term Loan Agent, as the case may
be, with respect thereto.
"Trust Estate" means (i) the right, title and interest of the
Collateral Agent in and to the Collateral and in, to and under each of the
Collateral Documents, (ii) the right, title and interest of the Collateral
Agent in, to and under each of the Title Policies and (iii) any amounts from
time to time held in the Collateral Account.
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(c) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and section
references are to this Agreement unless otherwise specified.
ARTICLE 2
DECLARATION OF TRUST; REMEDIES
2.1 Declaration and Acceptance of Trust. The Collateral
Agent hereby declares, and the Companies agree, that the Collateral Agent holds
the Trust Estate as secured party or mortgagee or deed of trust beneficiary, as
the case may be, in trust under this Agreement and the Collateral Documents for
the equal and ratable benefit of the Secured Parties (and the Persons for whom
the Secured Parties act as trustee, agent or fiduciary, as applicable), without
preference, priority or distinction of any thereof over any other by reason of
difference in time of issuance, sale or otherwise, as provided herein. Each
Secured Party, by executing and delivering this Agreement, and each Person for
whom such Secured Party acts as trustee, agent or fiduciary, as applicable, by
acceptance of the benefits of this Agreement and the Collateral Documents, (i)
consents to the appointment of the Collateral Agent as agent hereunder and
grants to the Collateral Agent all rights and powers necessary for the
Collateral Agent to perform its obligations hereunder, (ii) confirms that the
Collateral Agent shall have the authority, subject to the terms of this
Agreement, to act as the exclusive agent of such Secured Party (or Person, as
applicable) to make claims under and otherwise act in all respects as the
beneficiary of the Title Policies, to enforce any remedies under or with
respect to any Collateral Document, to give or withhold any consent or approval
relating to any Collateral or the Collateral Documents or any obligations with
respect thereto, and otherwise to take any action on behalf of the Secured
Parties (and such Persons) contemplated in the Collateral Documents (including,
without limitation, receiving opinions, maintaining collateral accounts and
exercising remedies) and (iii) agrees that, except as provided in this
Agreement, such Secured Party (or Person, as applicable) shall not take any
action to enforce any of such
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remedies or give any such consents or approvals relating to any Collateral or
the Collateral Documents or itself make any claim under the Title Policies. If
the Companies request that the Collateral Agent or the Secured Parties (or any
Person for whom such Secured Party acts as a trustee, agent or fiduciary, as
applicable) elect to defer for 3 years the effective date of regulatory
amendments effective July 1, 1997 with respect to Washington State Business and
Occupancy Tax, the Collateral Agent or such Secured Party is hereby authorized
to do so, and by accepting the benefits of this Agreement, each Person for whom
a Secured Party acts as trustee, agent or fiduciary, as applicable, hereby
consents to such action.
2.2 Remedies. (a) Upon the occurrence and during the
continuance of an Event of Default under the Indenture, the Note Majority
Holders shall have the right at any time, and, upon the occurrence and during
the continuance of an Event of Default under the Term Loan Agreement, the Term
Loan Note Majority Holders shall have the right at any time, to direct in one
or more writings (each, an "Enforcement Notice") addressed to the Collateral
Agent and the Secured Parties that any right or remedy available to the
Collateral Agent and the Trustee or the Term Loan Agent, as the case may be,
with respect to the Collateral be exercised by the Collateral Agent on behalf
of both Secured Parties (subject to Section 6.3 hereof), which Enforcement
Notice shall be effective 10 days from the date of delivery thereof, provided,
however, that the Note Majority Holders or the Term Loan Note Majority Holders,
as the case may be, taking such action must hold an aggregate principal amount
of Notes or Term Loan Notes, as the case may be, representing at least 15% of
the Total Amount of Secured Obligations. Each Enforcement Notice shall state
that an Event of Default either under the Indenture or the Term Loan Agreement
exists and generally describe the nature of and any relevant facts relating to
such Event of Default. Following receipt of any Enforcement Notice, the
Collateral Agent shall, subject to the provisions hereof relating to
indemnification of the Collateral Agent by the Companies, take the actions
directed therein and any other actions which it deems proper and which are not
inconsistent with such direction, provided, however, the Collateral Agent is
not obligated to take any actions outside the Enforcement Notice.
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(b) Upon the effective date of an Enforcement Notice from the
Note Majority Holders or the Term Loan Note Majority Holders, as the case may
be, the Collateral Agent shall notify PCAC and/or PAI, as applicable, in
writing that the Collateral Agent has received such Enforcement Notice,
enclosing a copy of such Enforcement Notice. An Enforcement Notice shall be
deemed to be in effect hereunder only if such notice shall have been given and
not rescinded, annulled or withdrawn in writing by the Note Majority Holders or
the Term Loan Note Majority Holders, as applicable, by whom such notice was
given.
(c) Whether or not the Collateral Agent has been directed
to exercise any right or remedy with respect to the Collateral pursuant to the
provisions of this Section 2.2, the Bank Lenders shall have the right, subject
to all relevant provisions of the Bank Credit Agreement, to pursue remedies
with respect to Obligor Collateral in accordance with the provisions of the
Bank Credit Agreement, all related agreements and this Agreement. In the event
that the Collateral Agent has been so instructed to pursue remedies with
respect to the Collateral, the Collateral Agent shall take such steps as it
deems reasonable and appropriate to avoid interfering with the Agent Bank's
exercise of rights and remedies with respect to Obligor Collateral.
(d) In the event that the Agent Bank shall attempt to
exercise any of its remedies with respect to Obligor Collateral, the Collateral
Agent (i) shall not hinder, delay or otherwise prevent the Agent Bank from
taking any and all action to the extent permitted by law which the Agent Bank
deems necessary to enforce its security interest in the Obligor Collateral and
realize thereon and (ii) to the extent that the Collateral Agent is in
possession of the Mortgaged Property, shall permit the Agent Bank to access and
occupy the Mortgaged Property and to use the Equipment, in each case without
rent, for a period not to exceed 90 days from the date Agent Bank receives
written notice from the Collateral Agent that it has acquired possession of the
Mortgaged Property, or such shorter period as is necessary for the Agent Bank
to complete Obligor Collateral consisting of work-in-process, to store Obligor
Collateral constituting inventory and to otherwise remove such Obligor
Collateral and complete its exercise of remedies in respect thereof. Agent
Bank shall indemnify the Collateral Agent for all damage to the Mortgaged
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Property or the Equipment (ordinary wear and tear excepted) proximately caused
by the negligence or willful misconduct of the Agent Bank or its agents or
employees. The Collateral Agent further agrees that it will not enforce any
statutory, possessory or other liens (including, without limitation, rights of
levy) with respect to the Obligor Collateral without the prior written consent
of the Agent Bank.
(e) Without limiting the provisions of the preceding
paragraphs (c) and (d), the Collateral Agent shall not seek to enforce any
rights under or with respect to the agreements (the "Tacoma Sales Agreements")
listed as items 3 and 4 on Annex 2 to the Security Agreement (as in effect of
the date hereof) or any related Collateral (as defined in the Security
Agreement) and shall not retain any proceeds thereof until the Agent Bank has
collected all Accounts Receivable (as defined in the Bank Credit Agreement as
in effect on the date hereof in existence under the Tacoma Sales Agreements and
completed and sold all Inventory (as defined in the Bank Credit Agreement as in
effect on the date hereof) pursuant to the terms of the Tacoma Sales Agreements
to the purchasers thereunder, to the extent that such Accounts Receivable and
Inventory were included in the calculation of the Borrowing Base (as defined on
the Bank Credit Agreement as in effect on the date hereof) prepared by PAAC for
the purpose of calculating loans made to PAAC under the Bank Credit Agreement
and delivered to the Agent Bank most recently prior to the acceleration of any
of the Secured Obligations (and in connection therewith the Agent Bank may
enforce Contract Rights under the Tacoma Sales Agreements), provided that (i)
the Agent Bank shall seek to collect such Accounts Receivable, sell such
Inventory and otherwise enforce Contract Rights in respect of the Tacoma Sales
Agreements reasonably promptly and otherwise in a commercially reasonable
manner that will not unreasonably prejudice the remaining rights of the
Collateral Agent and the Secured Parties with respect to such agreements; and
(ii) upon payment in full of such Accounts Receivable and the sale of such
Inventory pursuant to the Tacoma Sales Agreements, (x) the Agent Bank shall
have no further lien on or other interest in the Tacoma Sales Agreements or in
any Accounts Receivable or Contract Rights (as defined on the Bank Credit
Agreement as in effect on the date hereof) in respect thereof and (y) the
Tacoma Sales Agreements and all
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Accounts Receivable and Contract Rights in respect thereof shall be deemed
deleted from the definition of Obligor Collateral.
2.3 Determinations Relating to Collateral. In the event
(i) the Collateral Agent shall receive any written request from any Obligor
under any Collateral Document for consent or approval with respect to any
matter or thing relating to any Collateral or such Obligor's obligations with
respect thereto or (ii) there shall be due to or from the Collateral Agent
under the provisions of any Collateral Document any material performance or the
delivery of any material instrument or (iii) the Collateral Agent shall have
actual knowledge of any nonperformance by any Obligor of any covenant or any
breach of any representation or warranty of any Obligor set forth in any
Collateral Document, then, in each such event, the Collateral Agent shall,
within five Business Days (as defined in the Indenture, as in effect on the
date hereof), advise the Secured Parties in writing of the matter or thing as
to which consent has been requested or the performance or instrument required
to be delivered or the nonperformance or breach of which the Collateral Agent
has become aware. The Majority Holders shall have the exclusive authority to
direct the Collateral Agent's response to any of the circumstances contemplated
in clauses (i), (ii) and (iii) above, provided that the Majority Holders
include the Term Loan Note Majority Holders.
2.4 Right to Make Advances. If an advance of funds shall
at any time be required for the preservation or maintenance of any Collateral,
then, upon three Business Days' notice to the applicable Obligor, the
Collateral Agent or either Secured Party shall be entitled (but shall not be
obligated) to make such advance (it being understood that the Trustee shall not
be obligated to make any such advance other than in accordance with the terms
of the Indenture and that the Term Loan Agent shall not be obligated to make
any such advance other than in accordance with the terms of the Term Loan
Agreement). Each such advance shall be reimbursed, with interest from the date
such advance was made (at the rate initially borne by the Notes or the Term
Loan Notes, as applicable), by the applicable Obligor, upon demand by the
Collateral Agent or such Secured Party, as the case may be, and if the
applicable Obligor fails to comply with any such demand, out of the proceeds of
any sale of or other realization
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upon any Collateral distributed pursuant to clause FIRST of Section 4.1. In
the event either Secured Party shall receive any funds which, under this
Section 2.4, belong to the Collateral Agent or the other Secured Party, such
Secured Party shall remit such funds promptly to the Collateral Agent for
distribution to the Collateral Agent or such other Secured Party, as the case
may be, and prior to such remittance shall hold such funds in trust for the
Collateral Agent or such other Secured Party, as the case may be.
2.5 Nature of Secured Parties' Rights. Both Secured
Parties (and each Person for whom a Secured Party acts as trustee, agent or
fiduciary) shall be bound by any instruction or direction properly given by the
Majority Holders, the Note Majority Holders or the Term Loan Note Majority
Holders, as the case may be, as required by and subject to the provisions of
this Agreement.
2.6 Voting. In each case where any vote or consent of
the Holders or Term Loan Lenders, as the case may be, is required or desired to
be made or determined hereunder each Secured Party shall, to the extent
required pursuant to and in accordance with the provisions of the Indenture or
the Term Loan Agreement, respectively, advise in writing the Persons for whom
it acts as trustee, agent or fiduciary of the matters or thing to which such
vote or consent pertain and afford such Persons an opportunity to indicate
(which may be accomplished by affirmative act or failure to act within a
prescribed time period) a response to the matters or things set forth in such
writing. The results of such voting or consent solicitation shall be promptly
reported in writing to the Collateral Agent and shall be certified as correct
to the best knowledge of such Secured Party. Any determination as to whether
the requisite vote or consent has been obtained shall be made by the Collateral
Agent on the basis of such written information, which information may be
conclusively relied upon by the Collateral Agent. The Collateral Agent shall
not be liable for errors in such determinations unless the Collateral Agent
shall have been grossly negligent or shall have acted in bad faith in
connection therewith.
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ARTICLE 3
COLLATERAL DOCUMENTS
3.1 Recording; Priority; Opinions, Etc. (a) Each Obligor
shall at their sole cost and expense perform any and all acts and execute any
and all documents (including, without limitation, the execution, amendment or
supplementation of any financing statement and continuation statement or other
statement) for filing under the provisions of the Uniform Commercial Code and
the rules and regulations thereunder, or any other statute, rule or regulation
of any applicable federal, state or local jurisdiction, including any filings
in local real estate land record offices, which are necessary or advisable and
shall do such other acts and execute such other documents as may be required
from time to time, in order to grant and maintain in favor of the Collateral
Agent for the benefit of the Secured Parties a valid and perfected first
priority Lien on the Collateral, subject only to Liens permitted under the
Collateral Documents to be senior to the Liens of the Collateral Agent, and to
fully preserve and protect the rights of the Collateral Agent under the
Collateral Documents.
Each Obligor shall from time to time promptly pay and satisfy
all mortgage and financing and continuation statement recording and/or filing
fees, charges and taxes relating to the Collateral Documents to which such
Obligor is a party, any amendments thereto and any other instruments of further
assurance. Without limiting the generality of the foregoing, if at any time
the Trustee, the Term Loan Agent or the Collateral Agent shall determine that
additional mortgage recording, transfer or similar taxes are required to be
paid to perfect or continue any Lien on any Collateral, the applicable Obligor
shall pay such taxes promptly upon demand by the Collateral Agent.
(b) The Obligors shall, with respect to clause (i) below, on
or prior to the date hereof, and, with respect to clause (ii) below, at such
times as contemplated therein, furnish to the Trustee, the Term Loan Agent and
the Collateral Agent:
(i) Opinion(s) of Counsel either (a) to the effect that, in
the opinion of such counsel, this Agreement and the
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grants of security interests in the Collateral intended to be made by
the Collateral Documents and all other instruments of further
assurance, including, without limitation, financing statements and
each of the Mortgages, the Security Agreement and the Stock Pledge
Agreement have been properly registered, recorded and filed to the
extent necessary to perfect the Lien on the Collateral created by the
Collateral Documents and reciting the details of such action, and
stating that as to the Liens created pursuant to the Collateral
Documents, such recordings, registrations and filings are the only
recordings, registrations and filings necessary to give notice thereof
and that no re-recordings, re-registrations or refilings are necessary
to maintain such notice (other than as stated in such opinion), or (b)
to the effect that, in the opinion of such counsel, no such action is
necessary to perfect such Lien; and
(ii) on each anniversary of the Closing Date (as defined in the
Indenture, as in effect on the date hereof), beginning with such
anniversary in the year 1998, an Opinion of Counsel dated as of such
date, either (a) to the effect that, in the opinion of such counsel,
such action has been taken with respect to the recordings,
registerings, filings, re-recordings, re-registerings and refilings of
all financing statements, continuation statements or other instruments
of further assurance as is necessary to maintain the Lien of each of
the Collateral Documents and reciting with respect to such Liens the
details of such action or referencing prior Opinions of Counsel in
which such details are given, and stating that all financing
statements and continuation statements have been executed and filed
that are necessary as of such date and during the succeeding twelve
months fully to preserve and protect the rights of the Collateral
Agent, the Holders, the Trustee, the Term Loan Lenders and the Term
Loan Agent hereunder and under each of the Collateral Documents with
respect to such Liens, or (b) to the effect that, in the opinion of
such counsel, no such action is necessary to maintain such Liens.
3.2 Release of Collateral. To the extent applicable, the
Obligors shall cause Trust Indenture Act Section 314(d) relating to the release
of property or Liens to be complied with.
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(a) Satisfaction and Discharge of Indenture Obligation and
Term Loan Obligation. The Obligors shall be entitled to obtain a full release
of all of the Collateral from the Lien of the Collateral Documents upon
compliance with all of the conditions precedent set forth in Section 1201 of
the Indenture for complete satisfaction and discharge of all of PAAC's
obligations under the Indenture and in Section 9.12 of the Term Loan Agreement
for complete satisfaction of all of PAAC's obligations under the Term Loan
Agreement and the termination thereof. Upon delivery by PAAC to the Trustee,
the Term Loan Agent and the Collateral Agent of (i) an Officers' Certificate
and an Opinion of Counsel and (ii) an Officers' Certificate (as defined in the
Term Loan Agreement) and an Opinion of Counsel (as defined in the Term Loan
Agreement), all to the effect that such conditions precedent have been complied
with, the Trustee and the Term Loan Agent shall, at the written request and
expense of PAAC, promptly direct the Collateral Agent to release and reconvey
to PAI or PCAC, as applicable, all of their respective Collateral, and upon
receipt of such direction by the Trustee and the Term Loan Agent, the
Collateral Agent shall do so and deliver any Collateral in its possession to
PAI or PCAC, as applicable.
(b) Sales of Collateral Permitted by Section 1009 of the
Indenture and Section 7.2.6 of the Term Loan Agreement. PAAC shall be entitled
to obtain a release of all or any part of the Collateral (other than Trust
Moneys) (the "Released Interests") subject to an Asset Sale (as defined in the
Indenture) or to an Asset Sale (as defined in the Term Loan Agreement and for
purposes hereof a "Term Loan Asset Sale"), and the Trustee and the Term Loan
Agent shall direct the Collateral Agent to release the Released Interests from
the Liens of the Mortgages, the Security Agreement or the Stock Pledge
Agreement, as the case may be, promptly upon (x) compliance with (i) the
conditions precedent specified in Section 1009 of the Indenture for any Asset
Sale involving Collateral, and (ii) the conditions precedent specified in
Section 7.2.6 of the Term Loan Agreement for any Term Loan Asset Sale involving
Collateral and (y) delivery by PAAC to the Trustee, the Term Loan Agent and the
Collateral Agent of the following:
(i) Release Notice. A notice (each, an "Asset Sale Release
Notice"), which shall (A) refer to this Section 3.2,
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(B) attach all the documents referred to below, (C) describe with
particularity the Released Interests, (D) specify the fair market
value of such Released Interests on a date within 60 days of the Asset
Sale Release Notice (the "Valuation Date"), (E) certify that the
purchase price received is not less than the fair market value of the
Released Interests as of the date of such release, (F) state that the
release of the Released Interests will not interfere with or impede
the Collateral Agent's ability to realize the value of the remaining
Collateral and will not impair the maintenance and operation of the
remaining Collateral, and (G) be accompanied by a counterpart of the
instruments proposed to give effect to the release fully executed and
acknowledged (if applicable) by all parties thereto other than the
Collateral Agent;
(ii) Officers' Certificate. An Officers' Certificate
certifying that (A) such Asset Sale covers only the Released Interests
and complies with the terms and conditions of an Asset Sale pursuant
to Section 1009 of the Indenture and Section 7.2.6 of the Term Loan
Agreement, (B) all Collateral Proceeds (as defined in the Indenture)
from the sale of the Released Interests will be applied pursuant to
Section 1009 of the Indenture and Section 7.2.6 of the Term Loan
Agreement, (C) there is no Default under either the Indenture or the
Term Loan Agreement or Event of Default under either the Indenture or
the Term Loan Agreement in effect or continuing on the date thereof,
the Valuation Date or the date of such Asset Sale or Term Loan Asset
Sale, (D) the release of the Released Interests will not result in a
Default under either the Indenture or the Term Loan Agreement or Event
of Default under either the Indenture or the Term Loan Agreement and
(E) all conditions precedent to such release have been complied with;
(iii) Regarding Real Property. If any Released Interest is
only a portion of a discrete parcel of real property, evidence that a
title company shall have committed to issue an endorsement to the
title insurance policy relating to the affected Mortgaged Property,
confirming that after such release, the Lien of the applicable
Mortgage shall continue unimpaired as a first priority perfected Lien
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upon the remaining Mortgaged Property subject only to Excepted Liens
(as defined in the applicable Mortgage), and that the remaining
Mortgaged Property satisfies all applicable subdivision, zoning and
land use requirements and is not part of a larger tax lot;
(iv) Proceeds of Asset Sale. The Collateral Proceeds (as
defined in the Indenture) and the Net Proceeds (as defined in the Term
Loan Agreement) resulting from an Asset Sale in respect of Collateral
("Term Loan Collateral Proceeds") and other non-cash consideration
received from an Asset Sale or Term Loan Asset Sale shall be required
to be delivered to the Collateral Agent to be deposited in the
Collateral Account to be applied pursuant to Article 4 hereof; and if
any property other than cash or Cash Equivalents (as defined in the
Indenture and the Term Loan Agreement) is included in such
consideration, such instruments of conveyance, assignment and
transfer, if any, delivered to the Collateral Agent as may be
necessary, in the opinion of counsel to the Collateral Agent, to
subject to the Lien of the Collateral Documents all right, title and
interest of the applicable Obligor in and to such property;
(v) Opinions of Counsel. One or more Opinions of Counsel
which, when considered collectively, shall be substantially to the
effect (A) that any obligation included in the consideration for any
Released Interest and to be received by the Collateral Agent pursuant
to paragraph (iv) above is a valid and binding obligation enforceable
in accordance with its terms, subject to such customary exceptions
regarding equitable principles and creditors' rights generally as
shall be reasonably acceptable to the Collateral Agent, the Trustee
and the Term Loan Agent, and the Collateral Documents are effective to
create a valid and perfected security interest in such obligations,
subject to customary exceptions, (B) either (1) that such instruments
of conveyance, assignment and transfer as have been or are then
delivered to the Collateral Agent are sufficient to subject to the
Lien of the Collateral Documents all right, title and interest of the
applicable Obligor in and to any property, other than cash or Cash
Equivalents included in the consideration for the Released Interests
and to be
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received by the Collateral Agent pursuant to paragraph (iv) above, or
(2) that no instruments of conveyance, assignment or transfer are
necessary for such purpose, (C) that the applicable Obligor has
corporate power to own all property included in the consideration for
such release and (D) that all conditions precedent provided in the
Indenture, the Term Loan Agreement and the Collateral Documents
relating to the Asset Sale or Term Loan Asset Sale and such release of
the Released Interests have been complied with; and
(vi) Other Documents. All documentation required by Trust
Indenture Act Section 314(d).
(c) Other Release of Collateral. In the event PAI or
PCAC desires to release any Collateral not otherwise permitted by Section
3.2(b) or 3.3 of this Agreement (the "Other Released Interest"), PAI or PCAC,
as applicable, shall be entitled to obtain a release of such Collateral upon
(x) the consent of the Majority Holders provided that such Majority Holders
include Term Loan Lenders holding 100% of the aggregate outstanding principal
amount of the Term Loan Notes (provided that for purposes of this Section there
shall not be counted any interest in Notes or Term Loan Notes (A) for which
(and to the extent that) there are at such time on deposit with the Collateral
Agent, the Trustee or the Term Loan Agent amounts to be applied to the payment
of principal thereof and (B) which are held by any of the Companies or any
Affiliate of any of the Companies) and (y) delivery by PAAC to the Trustee, the
Term Loan Agent and the Collateral Agent of the following:
(i) Release Notice. A notice (each a "Release Notice"
which shall (A) refer to this Section 3.2(c), (B) attach all the
documents referred to below, (C) describe with particularity the Other
Released Interest, (D) specify the fair market value of such Other
Released Interest on a date within 60 days of the Release Notice (the
"Other Valuation Date"), (E) certify that the purchase price to be
received is not less than the fair market value of the Other Released
Interest as of the date of the proposed release, (F) state that the
release of the Other Released Interest will not interfere with or
impede the Collateral Agent's ability to realize the value of the
remaining Collateral and will not
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impair the maintenance and operation of the remaining Collateral and
(G) be accompanied by a counterpart of the instruments proposed to
give effect to the release fully executed and acknowledged (if
applicable) by all parties thereto other than the Collateral Agent.
(ii) Officers' Certificate. An Officers' Certificate
certifying that (A) such sale covers only the Other Released Interest,
(B) all proceeds from the sale of the Other Released Interest will be
deemed Trust Moneys (as hereinafter defined) and deposited into the
Collateral Account to be applied pursuant to Article 4 hereof, (C)
there is no Default under either the Indenture or the Term Loan
Agreement or Event of Default under either the Indenture or the Term
Loan Agreement in effect or continuing on the date thereof, the Other
Valuation Date or the date of such sale, (D) the release of the Other
Released Interests will not result in a Default under either the
Indenture or the Term Loan Agreement or Event of Default under either
the Indenture or the Term Loan Agreement, (E) all conditions precedent
to such release have been complied with, (F) requirements of Section
3.2(b)(iii) have been met with respect to the Other Released Interest,
as if such Other Released Interest were a Released Interest.
(iii) Proceeds of Asset Sale. The Collateral Proceeds (as defined
in the Indenture) and the Term Loan Collateral Proceeds and other
non-cash consideration received from the sale of the Other Released
Interest shall be required to be delivered to the Collateral Agent to
be deposited in the Collateral Account to be applied pursuant to
Article 4 hereof; and if any property other than cash or Cash
Equivalents (as defined in the Indenture and the Term Loan Agreement)
is included in such consideration, such instruments of conveyance,
assignment and transfer, if any, delivered to the Collateral Agent as
may be necessary, in the opinion of counsel to the Collateral Agent,
to subject to the Lien of the Collateral Documents all right, title
and interest of the applicable Obligor in and to such property.
(iv) Opinion. One or more Opinions of Counsel meeting the
requirements of Section 3.2(b)(v).
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At any time when an Event of Default under either the
Indenture or the Term Loan Agreement shall have occurred and be continuing, no
release of Collateral pursuant to the provisions of this Agreement or the other
Collateral Documents shall be effective as against the Collateral Agent or the
Secured Parties.
(d) Release of New Collateral. The New Collateral shall
be released by the Collateral Agent upon delivery by PAAC of an Officer's
Certificate to the Trustee, the Term Loan Agent and the Collateral Agent that
the conditions set forth in Section 1017 of the Indenture have been satisfied.
3.3 Disposition of Collateral Not Requiring Consent. (a) So
long as no Event of Default under either the Indenture or the Term Loan
Agreement shall have occurred and be continuing, PCAC may, without any consent
by the Collateral Agent, sell or otherwise dispose of any Collateral the sale
or disposition of which would not constitute an Asset Sale (as defined in the
Indenture) or Term Loan Asset Sale by virtue of clauses (i) and (iv) of the
definitions thereof; provided, that notwithstanding the foregoing, if any such
Collateral consists of Real Property, PAAC shall deliver to the Trustee, the
Term Loan Agent and the Collateral Agent an Officers' Certificate confirming
that the requirements of Section 3.2(b)(iii) have been met and containing the
statement set forth in Section 3.2(b)(i)(F).
(b) In the event that PCAC has sold, exchanged, or otherwise
disposed of or proposed to sell, exchange or otherwise dispose of any portion
of the Collateral which under the provisions of this Section 3.3 may be sold,
exchanged or otherwise disposed of by PCAC without any release or consent of
the Collateral Agent, and PCAC requests in writing that the Collateral Agent
furnish a written disclaimer, release or quit-claim of any interest in such
property under any of the Collateral Documents, the Collateral Agent shall
promptly execute such an instrument upon delivery to the Trustee, the Term Loan
Agent and the Collateral Agent of (i) an Officers' Certificate by PCAC
reciting the sale, exchange or other disposition made or proposed to be made
and describing in reasonable detail the property affected thereby, and stating
and demonstrating that such property is property which by the provisions of
this Section 3.3 may be sold, exchanged or otherwise disposed of or dealt with
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by PCAC without any release or consent of the Collateral Agent and (ii) an
Opinion of Counsel stating that the sale, exchange or other disposition made or
proposed to be made was duly made by PCAC in conformity with this Agreement
and that the execution of such written disclaimer, release or quitclaim is
appropriate to confirm the propriety of such sale, exchange or other
disposition under this Section 3.3. Notwithstanding the preceding sentence,
all purchasers and grantees of any property or rights purporting to be released
herefrom shall be entitled to rely upon any release executed by the Collateral
Agent hereunder as sufficient for the purposes hereof.
3.4 Eminent Domain and Other Governmental Takings. Subject
to the provisions of the Collateral Documents, should any of the Collateral be
taken by eminent domain or be sold pursuant to the exercise by the United
States of America or any State, municipality or other governmental authority of
any right which any of them may then have to purchase, or to designate a
purchaser or to order a sale of, all or any part of the Collateral, the
Collateral Agent shall release the property so taken or purchased, but only
upon receipt by the Trustee, the Term Loan Agent and the Collateral Agent of
the following:
(a) Officers' Certificates. An Officers' Certificate stating
that (i) such property has been taken by eminent domain and the amount of the
award therefor, or that such property has been sold pursuant to a right vested
in the United States of America or a state, municipality or other governmental
authority to purchase, or to designate a purchaser or order a sale of such
property and the amount of the proceeds of such sale, and (ii) that all
conditions precedent herein provided for relating to such release have been
complied with;
(b) Proceeds of Taking. The proceeds of such taking or
purchase, delivered to the Collateral Agent, to be held by the Collateral Agent
and applied as provided herein; and
(c) Opinion of Counsel. An Opinion of Counsel substantially
to the effect:
(i) that such property has been lawfully taken by exercise of
the right of eminent domain, or has been sold
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pursuant to the exercise of a right vested in the United States of
America or a State, municipality or other governmental authority to
purchase, or to designate a purchaser or order a sale of, such
property;
(ii) in the case of any taking by eminent domain, that the
award for the property so taken has become final or that appeal from
such award is not advisable in the interests of PAAC or the Secured
Parties;
(iii) in the case of any such sale, that the amount of the
proceeds of the property so sold is not less than the amount to which
PCAC is legally entitled under the terms of such right to purchase or
designate a purchaser, or under the order or orders directing such
sale, as the case may be;
(iv) in the event that the award for such property or the
proceeds of such sale, or a specified portion thereof, shall be
certified to have been deposited with the trustee, mortgagee or other
holder of a Lien which is permitted by the Collateral Documents to be
prior to the Lien of the Collateral Documents, that the property to be
released, or a specified portion thereof, is or immediately before
such taking or purchase was subject to such prior Lien permitted by
the Collateral Documents, and that such deposit is required by such
prior Lien permitted by the Collateral Documents; and
(v) that the instrument or the instruments and the award or
proceeds of such sale which have been or are therewith delivered to
and deposited with the Collateral Agent conform to the requirements of
this Agreement and the other Collateral Documents and that, upon the
basis of such application, the Collateral Agent is permitted by the
terms hereof and of the other Collateral Documents to execute and
deliver the release requested, and that all conditions precedent
herein provided for relating to such release have been complied with.
In any proceedings for the taking or purchase or sale of any
part of the Collateral, by eminent domain or by virtue of any such right to
purchase or designate a purchaser or to order a
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sale, the Collateral Agent may be represented by counsel who may be counsel for
PAAC.
3.5 Suits to Protect Collateral. Subject to the provisions
hereof, the Majority Holders (provided that such Majority Holders include the
Term Loan Majority Holders) shall have the right to direct the Collateral
Agent, and if so directed, the Collateral Agent shall have the power, to
institute and to maintain such suits and proceedings as such Majority Holders
may deem expedient to prevent any impairment of the Collateral by any acts
which may be unlawful or in violation of any of the Collateral Documents, and
such suits and proceedings as such Majority Holders may deem expedient to
preserve or protect their interests in the Collateral (including power to
institute and maintain suits or proceedings to restrain the enforcement of or
compliance with any legislative or other governmental enactment, rule or order
that may be unconstitutional or otherwise invalid if the enforcement of, or
compliance with, such enactment, rule or order would impair the Liens of the
Collateral Agent in the Collateral or be prejudicial to the interests of the
Secured Parties).
3.6 Purchaser Protected. In no event shall any purchaser in
good faith of any property purported to be released hereunder be bound to
ascertain the authority of the Collateral Agent to execute the release or to
inquire as to the satisfaction of any conditions required by the provisions
hereof for the exercise of such authority or to see to the application of any
consideration given by such purchaser or other transferee; nor shall any
purchaser or other transferee of any property or rights permitted by this
Article 3 to be sold be under obligation to ascertain or inquire into the
authority of PAI or PCAC to make any such sale or other transfer.
3.7 Powers Exercisable by Receiver or Trustee. In case the
Collateral shall be in the possession of a receiver or trustee, lawfully
appointed, the powers conferred in this Article 3 upon PAI and PCAC with
respect to the release, sale or other disposition of such property may be
exercised by such receiver or trustee, and an instrument signed by such
receiver or trustee shall be deemed the equivalent of any similar instrument
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of PAI or PCAC, as the case may be, or of any officer or officers thereof
required by the provisions of this Article 3.
3.8 Determinations Relating to Collateral. In the event (i)
the Collateral Agent shall receive any written request from PCAC or PAI under
any Collateral Document for consent or approval with respect to any matter or
thing relating to any Collateral or the obligations of any Obligor with respect
thereto or (ii) there shall be due to or from the Collateral Agent under the
provisions of any Collateral Document any performance or the delivery of any
instrument or (iii) the Collateral Agent shall have actual knowledge of any
nonperformance by any Obligor of any covenant or any breach of any
representation or warranty of such Obligor set forth in any Collateral
Document, then, in each such event, the Collateral Agent shall be entitled to
hire experts, consultants, agents and attorneys to advise the Collateral Agent
on the manner in which the Collateral Agent should respond to such request or
render any requested performance or response to such nonperformance or breach.
The Collateral Agent shall be fully protected in the taking of any action
recommended or approved by any such expert, consultant, agent or attorney or
agreed to by the Majority Holders and the Term Loan Note Majority Holders.
3.9 Form and Sufficiency of Release. In the event that PAI
or PCAC has sold, exchanged, or otherwise disposed of or proposes to sell,
exchange or otherwise dispose of any portion of the Collateral which under the
provisions of this Article 3 may be sold, exchanged or otherwise disposed of by
PAI or PCAC, and the applicable Obligor requests the Collateral Agent to
furnish a written disclaimer, release or quitclaim of any interest in such
property under any of the Collateral Documents, the Collateral Agent shall
execute such an instrument promptly after satisfaction of the conditions set
forth herein for delivery of such instrument. Notwithstanding the preceding
sentence, all purchasers and grantees of any property or rights purporting to
be released herefrom shall be entitled to rely upon any release executed by the
Collateral Agent hereunder as sufficient for the purposes of this Indenture and
as constituting a good and valid release of the property therein described from
the Lien of this Indenture and the Collateral Documents.
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3.10 Possession and Use of Collateral. Subject to and in
accordance with the provisions of this Agreement and the other Collateral
Documents, so long as no Default under either the Indenture or the Term Loan
Agreement or Event of Default under either the Indenture or the Term Loan
Agreement shall have occurred and be continuing, the Obligors shall have the
right to remain in possession and retain exclusive control of the Collateral
(other than Trust Moneys, as defined in Section 4.1 hereof, securities and
other personal property held by, or required to be deposited or pledged with,
the Collateral Agent hereunder or under the other Collateral Documents), to
operate, manage, develop, use and enjoy the Collateral (other than Trust
Moneys, securities and other personal property held by, or required to be
deposited or pledged with, the Collateral Agent hereunder or under the other
Collateral Documents) and to collect, receive, use, invest and dispose of the
reversions, remainders, rates, interest, rents, issues, profits, revenues,
proceeds and other income thereof (other than Trust Moneys, securities and
other personal property held by, or required to be deposited or pledged with,
the Collateral Agent hereunder or under the other Collateral Documents).
3.11 Additional Indebtedness and Additional Collateral. In
the event that PAAC or the Subsidiary Guarantors incur additional Indebtedness
(the "Additional Obligation") as permitted under Section 1008 of the Indenture
and Section 7.2.2 of the Term Loan Agreement, and provided that (a) the assets
or property acquired or constructed with the Additional Obligation (the
"Additional Collateral") are pledged and a first priority mortgage or security
interest (as applicable) therein is granted to the Collateral Agent to become a
part of the Collateral securing the Secured Obligations on a pari passu basis,
and the other conditions set forth in Section 1012(j) of the Indenture and
clause (j) of Section 7.2.2 of the Term Loan Agreement are satisfied, and (b)
the Collateral Agent shall have received an endorsement to its Title Policies
insuring the continuing priority of the Mortgages as set forth in the Title
Policies, then this Agreement shall be amended to add as Secured Parties the
holders of the Additional Obligation or any trustee or other representative
thereof (the "Additional Secured Party") and to permit the Additional Secured
Party to exercise rights and remedies in accordance therewith, and the other
Collateral
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Documents will be amended to add the Additional Obligation to the definition of
Secured Obligations therein.
ARTICLE 4
APPLICATION OF TRUST MONEYS
4.1 "Trust Moneys" Defined. All cash or Cash Equivalents
received by the Collateral Agent:
(a) upon the release of property from the Lien of any of the
Collateral Documents; or
(b) as proceeds of insurance upon any, all or part of the
Collateral (other than any liability insurance proceeds payable to either of
the Secured Parties or to the Collateral Agent, respectively, for any loss,
liability or expense incurred by it), including, without limitation, proceeds
of any insurance received pursuant to subsection IV(q) of any Mortgage; or
(c) as proceeds of any other sale or other disposition of all
or any part of the Collateral by or on behalf of the Collateral Agent
(including any proceeds received pursuant to subsection IV(q) of any Mortgage
in respect of the sale or other disposition of all or any part of the
Collateral taken by eminent domain or purchased by, or sold pursuant to any
order of a governmental authority) or any collection, recovery, receipt,
appropriation or other realization of or from all or any part of the Collateral
pursuant to the Collateral Documents or otherwise; or
(d) for application under this Article 4 as elsewhere
provided in this Agreement or the other Collateral Documents, or whose
disposition is not elsewhere otherwise specifically provided for herein or in
the Collateral Documents;
(all such moneys being herein sometimes called "Trust Moneys") shall be subject
to a Lien and security interest in favor of the Collateral Agent and shall be
held by the Collateral Agent in the Collateral Account for the benefit of the
Secured Parties as a part of the Collateral.
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The Collateral Agent shall apply such amount or proceeds as
soon as practicable after receipt as follows:
FIRST: To the Collateral Agent in an amount equal to the
Collateral Agent's Fees which are unpaid as of the applicable Distribution Date
and to any Secured Party which has theretofore advanced or paid any such
Collateral Agent's Fees in an amount equal to the amount thereof so advanced or
paid by such Secured Party and to reimburse to the Collateral Agent and any
Secured Party the amount of any advance made pursuant to Section 2.4 (with
interest thereon at the rate initially borne by the Notes or the Term Loan
Notes, as applicable);
SECOND: Provided that no Default under either the Indenture
or the Term Loan Agreement or Event of Default under either the Indenture or
the Term Loan Agreement shall have occurred and be continuing, (i) any such
Trust Moneys constituting Insurance Proceeds or Net Awards may be withdrawn by
PAAC or PCAC pursuant to Section 4.2 hereof to be applied to effect a
Restoration in accordance with the applicable Mortgage; (ii) in accordance with
the terms of Section 1009 of the Indenture governing Net Proceeds and Section
7.2.6 of the Term Loan Agreement governing Net Proceeds (as defined in the Term
Loan Agreement as in effect on the date hereof), any such Trust Moneys
constituting Collateral Proceeds (as defined in the Indenture) or Term Loan
Collateral Proceeds, Insurance Proceeds or Net Awards may be withdrawn by PAAC
pursuant to Sections 4.3 or 4.4 hereof to be applied to a reinvestment in PAAC
or in one of its Subsidiaries that is a Restricted Subsidiary for purposes of
both the Indenture and the Term Loan Agreement in a Related Business (as
defined in the Indenture as in effect on the date hereof) or to the permanent
repayment or prepayment of any Senior Indebtedness (as defined in the Indenture
as in effect on the date hereof) then outstanding; and (iii) any such Trust
Moneys not so withdrawn and applied shall be transferred by the Collateral
Agent to the Trustee and shall thereupon become Excess Proceeds which shall be
used to make an Asset Sale Offer pursuant to Section 1009 of the Indenture.
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4.2 Withdrawals of Insurance Proceeds and Net Awards for
Restoration. To the extent that any Trust Moneys consist of either Insurance
Proceeds or Net Awards received by the Collateral Agent pursuant to subsection
IV(q) of any Mortgage and such Insurance Proceeds or Net Awards may be applied
by PAAC to effect a Restoration of the affected Collateral, such Trust Moneys
may be withdrawn by PAAC and shall be paid by the Collateral Agent, upon a
request by a Company Order (as defined in the Indenture as in effect on the
date hereof) to reimburse the applicable Obligor for expenditures made, or to
pay costs incurred, by such Obligor to repair, rebuild or replace the
Collateral destroyed, damaged or taken, upon receipt by the Trustee, the Term
Loan Agent and the Collateral Agent of the following:
(a) Officers' Certificate. An Officers' Certificate of PAAC,
dated not more than 30 days prior to the date of the application for the
withdrawal and payment of such Trust Moneys:
(i) that expenditures have been made, or costs incurred, by
the Obligor in a specified amount for the purpose of making certain
repairs, rebuildings and replacements of the Collateral, which shall
be briefly described, and stating the fair market value thereof at the
date of the expenditure or incurrence thereof by PAAC or PCAC;
(ii) that no part of such expenditures or costs has been or
is being made the basis for the withdrawal of any Trust Moneys in any
previous or then pending application pursuant to this Agreement;
(iii) that there is no outstanding Indebtedness (as defined
in the Indenture as in effect on the date hereof) other than costs for
which payment is being requested, for the purchase price or
construction of such repairs, rebuildings or replacements, or for
labor, wages, materials or supplies in connection with the making
thereof, which, if unpaid, might become the basis of a vendor's,
mechanic's, laborer's, materialman's statutory or other similar Lien
upon any Collateral;
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(iv) that the property to be repaired, rebuilt or replaced is
necessary or desirable in the conduct of PAAC's business;
(v) whether any part of such repairs, rebuildings or
replacements within six months before the date of acquisition thereof
by the Obligor has been used or operated by any person other than such
Obligor in a business similar to that in which such property has been
or is to be used or operated by such Obligor, and whether the fair
value to such Obligor, at the date of such acquisition, of such part
of such repairs, rebuildings or replacement is more than $25,000;
(vi) that no Default under either the Indenture or the Term
Loan Agreement or Event of Default under either the Indenture or the
Term Loan Agreement shall have occurred and be continuing; and
(vii) that all conditions precedent provided for herein and
in the Indenture and the Term Loan Agreement (if any) relating to such
withdrawal and payment have been complied with;
(b) Opinion of Counsel. An Opinion of Counsel substantially
stating:
(i) that the instruments that have been or are therewith
delivered to the Collateral Agent, the Trustee and the Term Loan Agent
conform to the requirements of this Agreement and the other Collateral
Documents, and that, upon the basis of such request of PAAC and the
accompanying documents specified in this Section 4.2, all conditions
precedent provided for herein and in the Indenture and the Term Loan
Agreement (if any) relating to such withdrawal and payment have been
complied with, and the Trust Moneys whose withdrawal is then requested
may be lawfully paid over under this Section 4.2;
(ii) that the Collateral Agent has a valid and perfected lien
on such repairs, rebuildings and replacements, that the same and every
part thereof are
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subject to no Liens prior to the Lien of the Collateral Documents,
except Liens permitted under the Collateral Documents to which the
property so destroyed or damaged shall have been subject at the time
of such destruction or damage; and
(iii) that all of the Obligor's right, title and interest in
and to said repairs, rebuildings or replacements, or combination
thereof, are then subject to the Lien of the Collateral Documents;
(c) Architect's Certificate. An Architect's Certificate (as
defined in the applicable Mortgage) stating:
(i) that all Restoration work to which such request relates
has been done in compliance with the approved Plans and Specifications
(as defined in the applicable Mortgage) and in accordance with all
provisions of law;
(ii) the sums requested are required to reimburse the Obligor
for payments by such Obligor to, or are due to, the contractors,
subcontractors, materialmen, laborers, engineers, architects or other
persons rendering services or materials for the Restoration, and that,
when added to the sums, if any, previously paid out by the Collateral
Agent, such sums do not exceed the cost of the Restoration to the date
of such Architect's Certificate;
(iii) whether or not the Estimate (as defined in the
applicable Mortgage) continues to be accurate, and if not, what the
entire cost of such Restoration is then estimated to be; and
(iv) that the amount of the Insurance Proceeds or Net Awards,
as the case may be, plus any amount received by the Collateral Agent
under an Additional Undertaking (as defined in the applicable
Mortgage) remaining after giving effect to such payment, will be
sufficient on completion of the Restoration to pay for the same in
full (including, in detail, an estimate by trade of the remaining
costs of completion);
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(d) Final Request Documentation. If such request is the
final request for any payment, in addition to the documentation required by
(a), (b) and (c) above, such request shall be accompanied by:
(i) an Opinion of Counsel or a title insurance policy, binder
or endorsement satisfactory to the Collateral Agent confirming that
there has not been filed with respect to all or any part of the
applicable Mortgaged Property any Lien which is not either discharged
of record or bonded and which could have priority over the Lien of the
applicable Mortgage; and
(ii) an Officers' Certificate stating that all occupancy
certificates, operating and other permits, licenses, waivers, other
documents, or any combination of the foregoing required by law in
connection with or as a result of such Restoration have been obtained;
and
(e) Other Documents. All documentation required under Trust
Indenture Act Section 314(d).
Upon compliance with the foregoing provisions of this Section
4.2, the Collateral Agent shall pay on the written request of the applicable
Obligor, as the case may be, an amount of Trust Moneys of the character
aforesaid equal to the amount of the expenditures or costs stated in the
Officers' Certificate required by clause (i) of subsection (a) of this Section
4.2, or the fair value to such Obligor, as the case may be, of such repairs,
rebuildings and replacements covered by such Officers' Certificate, whichever
is less.
4.3 Withdrawal of Trust Moneys on Basis of Retirement of
Securities or other Senior Indebtedness. (a) Except with respect to Trust
Moneys subject to release pursuant to Section 4.3(b) and Section 4.4 hereof,
and as otherwise permitted by the Collateral Documents, (x) the Collateral
Agent shall transfer to the Term Loan Agent, at the written direction of PAAC,
and the Term Loan Agent shall apply, Trust Moneys from time to time to the
payment of the principal of and interest on any Term Loan Notes then due and
payable or to the prepayment thereof, including, without limitation, pursuant
to a Change of Control
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(as defined in the Term Loan Agreement) or a Term Loan Asset Sale, or (y) the
Collateral Agent shall apply, at the direction of the Obligors, Trust Moneys
from time to time to the permanent repayment or prepayment of Senior
Indebtedness (as defined in the Indenture as in effect on the date hereof) in
accordance with its terms and pursuant to Section 7.2.6 of the Term Loan
Agreement and Section 1009 of the Indenture, in each case as the Obligors shall
request in writing, upon receipt by the Trustee, the Term Loan Agent and the
Collateral Agent of the following:
(i) Board Resolution. Board Resolutions of each of the
Obligors directing the application pursuant to this Section 4.3 of a
specified amount of Trust Moneys and (A) if any such moneys are to be
applied to the payment of Term Loan Notes and/or Securities,
designating the Term Loan Notes and/or Securities so to be paid and,
in case any such moneys are to be applied to the prepayment or
purchase of Term Loan Notes and/or Securities, prescribing the method
of prepayment or purchase, the price or prices to be paid and the
maximum principal amount of Term Loan Notes and/or Securities to be
prepaid or purchased and any other provisions of this Agreement, the
Term Loan Agreement or the Indenture governing such prepayment or
purchase, and (B) in case any such moneys are to be applied to the
payment of other Senior Indebtedness, specifying such other Senior
Indebtedness and the principal amount thereof to be paid, together
with payment instructions therefor;
(ii) Purchase Price. Cash in the maximum amount of the
accrued interest, if any, required to be paid in connection with any
such payment, prepayment or purchase, which cash shall be held by the
Collateral Agent, in trust for such purpose;
(iii) Officers' Certificate. An Officers' Certificate, dated
not more than five Business Days prior to the date of the relevant
application, stating (A) that no Default under either this Indenture
or the Term Loan Agreement or Event of Default under either this
Indenture or the Term Loan Agreement exists unless such Default or
Event of Default would be cured thereby and that no such Default or
Event of Default would result from such application, and
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(B) that all conditions precedent and covenants provided for herein
and in the Indenture and the Term Loan Agreement (if any) relating to
such application of Trust Moneys have been complied with; and
(iv) Opinion of Counsel. An Opinion of Counsel stating that
the documents and the cash or Cash Equivalents (as defined in the
Indenture as in effect on the date hereof), if any, which have been or
are therewith delivered to and deposited with the Collateral Agent,
the Term Loan Agent or the Trustee conform to the requirements of the
Indenture and that all conditions precedent provided for herein and in
the Term Loan Agreement and the Indenture relating to such application
of Trust Moneys have been complied with.
Upon compliance with the foregoing provisions of this Section
4.3(a), the Collateral Agent shall apply Trust Moneys as directed and specified
by such Board Resolution, up to, but not exceeding, the principal amount of the
Term Loan Notes, Securities or other Senior Indebtedness so paid, prepaid or
purchased, using the cash deposited pursuant to paragraph (ii) of this Section
4.3(a), to the extent necessary, to pay any accrued interest required in
connection with such payment, prepayment or purchase.
(b) To the extent that any Trust Moneys consist of (i) Term
Loan Collateral Proceeds received by the Collateral Agent that result in the
requirement to prepay principal in respect of the Term Loan Notes pursuant to
Section 7.2.6 of the Term Loan Agreement and a Term Loan Lender refuses any
such prepayment or (ii) Collateral Proceeds received by the Collateral Agent
that result in the requirement pursuant to Section 1009 of the Indenture to
make an Asset Sale Offer (as defined in the Indenture) and PAAC has made such
Asset Sale Offer which is not fully subscribed to by the Holders (as defined in
the Indenture), the Trust Moneys remaining after completion of such prepayment
or Asset Sale Offer may be withdrawn by PAAC and shall be paid by the
Collateral Agent to PCAC (or as otherwise directed by the Obligors) upon a
Company Order to the Collateral Agent and upon receipt by the Secured Parties
and the Collateral Agent of the following:
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(i) Notice. A notice which shall (A) refer to this Section
4.3(b) and (B) describe with particularity the Asset Sale or Term Loan
Asset Sale or the destruction or condemnation in respect of which such
Trust Moneys were held as Collateral, the amount of Trust Moneys
applied to the prepayment of principal in respect of Term Loan Notes
or the purchase of Securities pursuant to the Asset Sale Offer and the
remaining amount of Trust Moneys to be released to PAAC;
(ii) Officers' Certificate. An Officer's Certificate
certifying that (A) the release of the Trust Moneys complies with the
terms and conditions of Section 1009 of the Indenture and Section
7.2.6 of the Term Loan Agreement, (B) there is no Default under either
the Indenture or the Term Loan Agreement or Event of Default under
either the Indenture or the Term Loan Agreement in effect or
continuing on the date thereof, (C) the release of the Trust Moneys
will not result in a Default under either the Indenture or the Term
Loan Agreement or Event of Default under either the Indenture or the
Term Loan Agreement, and (D) all conditions precedent and covenants
provided for herein and in the Indenture and the Term Loan Agreement
(if any) relating to such release have been complied with;
(iii) Opinion of Counsel. An Opinion of Counsel stating that
the documents that have been or are therewith delivered to the
Collateral Agent or the Secured Parties conform to the requirements of
this Agreement and that all conditions precedent provided for herein
and in the Indenture and the Term Loan Agreement (if any) relating to
such application of Trust Moneys have been complied with; and
(iv) Other Documents. All documentation required under Trust
Indenture Act Section 314(d).
4.4 Withdrawal of Trust Moneys for Reinvestment. To the
extent that any Trust Moneys consist of Term Loan Collateral Proceeds received
by the Collateral Agent pursuant to the provisions hereof and to the extent the
aggregate amount of such Term Loan Collateral Proceeds since the date hereof
(when added to the aggregate amount of other Net Proceeds of Term Loan Asset
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Sales since the date hereof) does not exceed $35,000,000, or to the extent that
any Trust Moneys consist of Collateral Proceeds received by the Collateral
Agent pursuant to the provisions of Section 1009 of the Indenture, and PAAC
intends to reinvest such Term Loan Collateral Proceeds in PAAC or in one or
more Restricted Subsidiaries in a Related Business (the "Released Trust
Moneys"), such Trust Moneys may be withdrawn by PAAC and shall be paid by the
Collateral Agent to PAAC (or as otherwise directed by PAAC) upon a Company
Order to the Trustee and the Collateral Agent and upon receipt by the Trustee,
the Agent Bank and the Collateral Agent of the following:
(a) Notice. A notice which shall (i) refer to this Section
4.4, (ii) contain all documents referred to below, (iii) describe with
particularity the Released Trust Moneys and the Term Loan Asset Sale from which
such Released Trust Moneys were held as Collateral, (iv) describe with
particularity the investment to be made with respect to the Released Trust
Moneys and (v) be accompanied by a counterpart of the instruments proposed to
give effect to the release fully executed and acknowledged (if applicable) by
all parties thereto other than the Collateral Agent;
(b) Officers' Certificate. An Officer's Certificate
certifying that (i) the release of the Released Trust Moneys complies with the
terms and conditions of Section 7.2.6 of the Term Loan Agreement and Section
1009 of the Indenture, (ii) there is no Default either under the Indenture or
the Term Loan Agreement or Event of Default under either the Indenture or the
Term Loan Agreement in effect or continuing on the date thereof, (iii) the
release of the Released Trust Moneys will not result in a Default either under
the Indenture or the Term Loan Agreement or Event of Default either under the
Indenture or the Term Loan Agreement, (iv) the parties executing any and all
documents required under this Section 4.4 were duly authorized to do so, and
(v) all conditions precedent and covenants provided for herein and in the
Indenture and Term Loan Agreement (if any) relating to such release and
application of the Released Trust Moneys have been complied with;
(c) Real Property Investment Documentation. If the Released
Trust Moneys are to be invested in Real Property:
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(i) a Mortgage or other instrument or instruments in
recordable form sufficient to grant to the Collateral Agent for the
benefit of the Secured Parties (A) substantially the same rights and
remedies in respect of such Real Property as granted thereto under the
Mortgages executed and delivered on the date hereof and (B) a valid
first priority mortgage Lien on such Real Property subject to no Liens
other than Excepted Liens permitted under the Mortgages delivered on
the date hereof and, if the Real Property is a leasehold or easement
interest, such Mortgage or other instrument or instruments shall
include normal and customary provisions with respect thereto, in each
case together with evidence of the filing of all such financing
statements and other instruments as may be necessary to perfect such
Lien;
(ii) a policy of title insurance (or a paid commitment to
issue title insurance) insuring that the Lien of the instruments
delivered pursuant to clause (i) above constitutes a valid and
perfected first priority mortgage Lien on such Real Property in an
aggregate amount equal to the lesser of the fair market value of the
Real Property and the then outstanding principal amount of the Secured
Obligations, together with an Officers' Certificate stating that any
specific exceptions to such title insurance are Excepted Liens,
together with such endorsements and other opinions of the type
included in the title insurance policy or otherwise delivered to the
Collateral Agent on the date hereof with respect to the Mortgaged
Property;
(iii) in the event such Real Property has a fair market value
in excess of $250,000, a Survey with respect thereto;
(iv) evidence of payment or a closing statement indicating
payments to be made by the applicable Obligor of all title premiums,
recording charges, transfer taxes and other costs and expenses,
including reasonable legal fees and disbursements of counsel for the
Collateral Agent (and any local counsel), that may be incurred to
validly and effectively subject the Real Property to the Lien of any
applicable Collateral Document to perfect such Lien;
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(v) an Officers' Certificate stating that PAAC has caused
there to be conducted by a reputable expert a review and analysis of
the environmental conditions relating to such Real Property and that,
in the reasonable and good faith judgment of the issuer thereof such
Real Property does not contain any conditions which would cause a
prudent institutional lender to decline to fund loans secured by such
Real Property, together with a copy of the written report of such
expert; and
(vi) such further documents, opinions, certificates or
instruments (including, without limitation (A) policies or
certificates of insurance, (B) Uniform Commercial Code, judgment and
tax lien searches, (C) consents, approvals, estoppels and tenant
subordination agreements and (D) Officers' Certificates in respect of
compliance with local codes or ordinances relating to building or fire
safety or structural soundness and the adequacy of utility services)
as are customarily provided to institutional mortgage lenders and as
the Collateral Agent, the Trustee or Term Loan Agent may require;
(d) Personal Property Investment Documentation. If the
Released Trust Moneys are not invested in Real Property:
(i) an instrument sufficient to grant to the Collateral Agent,
for the benefit of the Secured Parties (A) substantially the same
rights and remedies in respect of such personal property interest as
granted thereto under the Collateral Documents executed and delivered
on the date hereof and (B) a valid first priority Lien on such
personal property interest subject to no Liens other than Liens
permitted under such instrument, together with evidence of the filing
of such financing statements and other instruments as may be necessary
to perfect such Liens, provided that in no event shall the Collateral
Agent be granted any security interests in any Obligor Collateral; and
(ii) evidence of payment or a closing statement indicating
payments to be made by the applicable Obligor of all filing fees,
recording charges, transfer taxes and other
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costs and expenses, including reasonable legal fees and disbursements
of counsel for the Collateral Agent (and any local counsel), that may
be incurred to validly and effectively subject such personal property
to the Lien of any Collateral Document;
(e) Opinion of Counsel. An Opinion of Counsel stating that
the documents that have been or are therewith delivered to the Collateral Agent
or the Secured Parties are enforceable (subject to customary exceptions),
create the Liens purported to be created thereby, have been duly authorized,
executed and delivered and do not conflict with any other agreements, conform
to the requirements of this Agreement and that all conditions precedent
provided for herein and in the Indenture and Term Loan Agreement (if any)
relating to such application of Trust Moneys have been complied with; and
(f) Other Documentation. All documentation required under
Trust Indenture Act Section 314(d).
Upon compliance with the foregoing provisions of this Section,
the Collateral Agent, at the direction of the Trustee, shall apply or cause to
be applied the Released Trust Moneys as directed and specified by PAAC.
4.5 Powers Exercisable Notwithstanding Default or Event of
Default. In case a Default either under the Indenture or the Term Loan
Agreement or an Event of Default either under the Indenture or the Term Loan
Agreement shall have occurred and shall be continuing, the Obligors, while in
possession of the Collateral (other than cash, Cash Equivalents (as defined in
the Indenture as in effect on the date hereof), securities and other personal
property held by, or required to be deposited or pledged with, the Collateral
Agent hereunder or under the Collateral Documents), may do any of the things
enumerated in Sections 4.2, 4.3 and 4.4 hereof if the Majority Holders and Term
Loan Note Majority Holders shall consent to such action, in which event any
certificate filed under any of such Sections shall omit the statement to the
effect that no Default either under the Indenture or the Term Loan Agreement or
Event of Default either under the Indenture or the Term Loan Agreement has
occurred and is continuing. This Section 4.5 shall not apply, however, during
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the continuance of an Event of Default (as defined in the Indenture) of the
type specified in Section 501(1) or (2) of the Indenture or an Event of Default
(as defined in the Term Loan Agreement) of the type specified in Section 8.1.1
of the Term Loan Agreement.
4.6 Powers Exercisable by Trustee or Receiver. In case the
Collateral (other than any cash, Cash Equivalents, securities and other
personal property held by, or required to be deposited or pledged with, the
Collateral Agent hereunder or under the Collateral Documents) shall be in the
possession of a receiver or trustee lawfully appointed, the powers hereinbefore
in this Article 4 conferred upon the Obligors with respect to the withdrawal or
application of Trust Moneys may be exercised by such receiver or trustee, in
which case a certificate signed by such receiver or trustee shall be deemed the
equivalent of any Officers' Certificate required by this Article. If the
Collateral Agent shall be in possession of any of the Collateral hereunder or
under any of the Collateral Documents, such powers may be exercised by the
Collateral Agent in its discretion, provided, however, that the Collateral
Agent shall not be required to exercise any such powers.
ARTICLE 5
COLLATERAL ACCOUNT
5.1 Collateral Account. The Collateral Agent shall
establish and maintain until all amounts due to all Secured Parties have been
paid to such Secured Parties, at the office of its corporate trust division, a
separate collateral trust account (the "Collateral Account"), which may be a
notional account, for the benefit of the Secured Parties. All funds on deposit
in the Collateral Account shall be held, applied and disbursed by the
Collateral Agent as part of the Trust Estate in accordance with the terms of
this Agreement.
5.2 Investment of Funds. The Collateral Agent shall
invest and reinvest moneys on deposit in the Collateral Account at any time in
Eligible Investments (as defined in the Indenture as in effect on the date
hereof) as directed in a writing from
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the Companies. The Companies shall bear the risk of loss on any such
investment (including loss of principal) made hereunder and shall, upon demand
of the Collateral Agent, deliver immediately available funds to the Collateral
Agent in an amount equal to such loss or losses.
ARTICLE 6
APPLICATION OF CERTAIN AMOUNTS UPON DEFAULT
6.1 Application of Trust Moneys upon Default. (a) If a
Default either under the Indenture or the Term Loan Agreement or an Event of
Default either under the Indenture or the Term Loan Agreement has occurred and
is continuing, and either the Indenture Obligation or the Term Loan Obligation
has been accelerated, then upon the instructions of either the Note Majority
Holders or the Term Loan Note Majority Holders, the Collateral Agent shall, as
soon as practicable, apply the Trust Moneys and any Insurance Proceeds, Net
Awards, Rents (as defined in the Mortgages) or other amounts or proceeds from
the sale or other disposition of or realization upon any Collateral (including
proceeds of any claim under the Title Policies) as follows: first to the
Collateral Agent's Fees and thereafter (i) to the Trustee in an amount equal to
the product of (x) the total amount available for distribution on such
Distribution Date under this Section 6.1 (such amount, "Total Net Proceeds")
and (y) the Trustee's Pro Rata Share as of such Distribution Date and (ii) to
the Term Loan Agent in an amount equal to the product of (x) Total Net Proceeds
and (y) the Term Loan Agent's Pro Rata Share as of such Distribution Date.
(b) Upon payment in full of all Collateral Agent's Fees and
all Secured Obligations, any balance shall be paid by the Collateral Agent to
PAAC or the successors or assigns of PAAC, as their interests may appear, or to
such Person who may be lawfully entitled to receive the same.
6.2 Payment Provisions. For the purposes of Section 6.1,
all interest accrued and unpaid on any of the Secured Obligations pursuant to
the terms of any Debt Instrument shall, as between the Secured Parties and
irrespective of whether
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recognized or allowed by any bankruptcy proceeding, be treated as due and owing
on the Secured Obligations.
6.3 Foreclosure of Less than the Total Secured Obligations.
In the event that the Collateral Agent is not authorized pursuant to Section
2.2(b) to accelerate the Secured Obligations as a whole in connection with an
exercise of remedies with respect to the Collateral, and the Trustee or the
Term Loan Agent, as the case may be, does not otherwise accelerate its
respective obligation prior to the exercise of remedies by the Collateral Agent
under the applicable Mortgage, the proceeds of such exercise of remedies shall
be applied, notwithstanding Section 6.1, solely to the obligation being
accelerated.
ARTICLE 7
AGREEMENTS WITH COLLATERAL AGENT
7.1 Delivery of Debt Instruments. On the date hereof,
each of the Companies shall deliver to the Collateral Agent a true and complete
copy of each document evidencing or securing the Term Loan Obligation and the
Indenture Obligation to which it is a party as in effect on the date hereof.
Promptly upon the execution thereof, each of the Companies shall deliver to the
Collateral Agent a true and complete copy of any and all amendments,
modifications or supplements of or to any of the foregoing to which it is a
party and copies of any such document or agreement it hereafter delivers.
7.2 Information as to Holders. The Companies shall
deliver to the Collateral Agent on or before each anniversary of the date of
this Agreement, and from time to time upon request of the Collateral Agent, a
list setting forth, for the Term Loan Agreement and for the Indenture, (i) the
aggregate principal amount outstanding thereunder, (ii) the interest rate or
rates then in effect thereunder, and (iii) to the extent known to the
Companies, the names of the Term Loan Lenders and Holders and the unpaid
principal amount owing to each. The Companies shall furnish to the Collateral
Agent within 30 days after the date hereof a list setting forth the name and
address of each party to whom notices must be sent under the Term Loan
Agreement and the
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Indenture, respectively, and the Companies shall furnish promptly to the
Collateral Agent any changes or additions to such list.
7.3 Compensation and Expenses. The Companies shall pay
to the Collateral Agent, from time to time upon demand, (i) compensation (which
shall be reasonable and not in excess of the Collateral Agent's customary
compensation for similar services and shall not be limited by any provision of
law in regard to compensation of a trustee of an express trust) for its
services hereunder and for administering the Trust Estate and (ii) all of the
fees, costs and expenses of the Collateral Agent (including, without
limitation, the reasonable fees and disbursements of its counsel) (a) arising
in connection with the preparation, execution, delivery, modification and
termination of this Agreement, and the enforcement of any provisions hereof, or
(b) incurred or required to be advanced in connection with the administration
of the Trust Estate, and the preservation, protection or defense of the
Collateral Agent's rights under this Agreement under the Collateral Documents
and in and to the Collateral and the Trust Estate. The obligations of the
Companies under this Section 7.3 shall survive the termination of the other
provisions of this Agreement.
7.4 Stamp and Other Similar Taxes. The Companies shall
indemnify and hold harmless the Collateral Agent and each Secured Party (and
each Person for whom any Secured Party acts as trustee, agent or fiduciary)
from any present or future claim for liability for any mortgage, stamp,
recording, intangibles or other similar tax and any penalties or interest with
respect thereto, which may be assessed, levied or collected by any jurisdiction
in connection with this Agreement, any Collateral Document or any Secured
Obligation. The obligations of the Companies under this Section 7.4 shall
survive the termination of the other provisions of this Agreement.
7.5 Filing Fees, Excise Taxes, etc. The Companies shall
pay or reimburse the Collateral Agent for any and all amounts in respect of all
search, filing, intangibles, transfer, recording and registration fees, taxes,
excise taxes and other similar imposts which may be payable or determined to be
payable in respect of the execution, delivery, performance and enforcement of
this Agreement, any Collateral Document or any
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Secured Obligation to the extent the same may be paid or reimbursed by the
Companies without subjecting the Collateral Agent or any Secured Party to any
civil or criminal liability. The obligations of the Companies under this
Section 7.5 shall survive the termination of the other provisions of this
Agreement.
7.6 Indemnification. (a) The Companies agree to pay,
indemnify, and hold the Collateral Agent harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever with
respect to the execution, delivery, enforcement, performance and administration
of this Agreement and the Collateral Documents unless arising from the gross
negligence or willful misconduct of the Collateral Agent.
(b) In any suit, proceeding or action brought by the
Collateral Agent with respect to the Collateral or for any sum owing in respect
of Secured Obligations, or to enforce the provisions of any Collateral
Document, the Companies shall save, indemnify and keep the Collateral Agent
harmless from and against all expenses, loss or damage suffered by reason of
any defense, set-off, counterclaim, recoupment or reduction of liability
whatsoever incurred or suffered by the Collateral Agent arising out of a breach
by the Companies of any obligation set forth in this Agreement, and all such
obligations of the Companies shall be and remain enforceable against and only
against the Companies. The provisions of this Section 7.6 shall survive the
termination of the other provisions of this Agreement.
7.7 Further Assurances. At any time and from time to
time, upon the written request of the Collateral Agent, and at the expense of
the Companies, the Companies shall promptly execute and deliver any and all
such further instruments and documents and take such further action as the
Collateral Agent reasonably deems necessary or desirable in obtaining the full
benefits intended to be provided by this Agreement.
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ARTICLE 8
COLLATERAL AGENT
8.1 Acceptance of Trust. The Collateral Agent, for
itself and its successors, hereby accepts the trust created by this Agreement
upon the terms and conditions hereof. The Collateral Agent's duties in respect
of the Trust Estate shall include, without limitation, the review of
applications of PCAC, PAI or others for consents, waivers, releases or other
matters relating to the Trust Estate or the Collateral and the prosecution
following any Event of Default under either the Indenture or the Term Loan
Agreement of any action or proceeding or the taking of any nonjudicial remedial
action as shall be determined to be required pursuant to Sections 2.2 and 2.3.
The Collateral Agent shall forward copies of any written communication it
receives from the Companies to the Secured Parties.
8.2 Exculpatory Provisions. (a) The Collateral Agent
shall not be responsible in any manner whatsoever for the correctness of any
recitals, statements, representations or warranties made by the Companies
herein or in any other Collateral Document. The Collateral Agent makes no
representations as to the value or condition of the Trust Estate or any part
thereof, or as to the title of PCAC or PAI, as applicable, thereto or as to the
security afforded by the Collateral Documents or this Agreement or as to the
validity, execution (except its own execution thereof), enforceability,
legality or sufficiency of the Collateral Documents or this Agreement or of the
Secured Obligations, and the Collateral Agent shall incur no liability or
responsibility in respect of any such matters. The Collateral Agent shall not
be responsible for insuring the Trust Estate or for the payment of taxes,
charges, assessments or Liens upon the Trust Estate, except that, subject to
the provisions of Section 8.4(c), in the event the Collateral Agent enters into
possession of a part or all of the Collateral, the Collateral Agent shall use
reasonable efforts to preserve the part in its possession.
(b) The Collateral Agent shall not be required to
ascertain or inquire as to the performance by any Obligor of any of the
covenants or agreements contained herein, in any Collateral Document or in any
Debt Instrument or other document
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evidencing or securing the Secured Obligations. Whenever it is necessary, or
in the opinion of the Collateral Agent advisable, for the Collateral Agent to
ascertain the amount of Secured Obligations then held by a Secured Party (or
any Person for whom a Secured Part acts as trustee, agent or fiduciary), the
Collateral Agent may rely on a certificate as to such amount from any trustee,
agent or fiduciary constituting or representing such Secured Party and if any
such Secured Party shall not provide such information to the Collateral Agent,
such Secured Party shall not be entitled to receive payments hereunder (in
which case the amounts otherwise payable to such Secured Party shall be held in
trust for such Secured Party in the Collateral Account) until such Secured
Party has provided such information to the Collateral Agent.
(c) The Collateral Agent shall not be personally liable
for any action taken or omitted to be taken by it in accordance with this
Agreement or any Collateral Document or any Debt Instrument or other document
evidencing or securing the Secured Obligations except for its own gross
negligence or willful misconduct.
8.3 Delegation of Duties. The Collateral Agent may
execute any of the trusts or powers hereof and perform any duty hereunder
either directly or by or through agents or attorneys-in-fact. The Collateral
Agent shall be entitled to advice of counsel concerning all matters pertaining
to such trusts, powers and duties. The Collateral Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it without gross negligence of willful misconduct in the employment
of such agents or attorneys-in-fact.
8.4 Reliance by the Collateral Agent. (a) The Collateral
Agent may consult with counsel, and any opinion of such counsel shall be full
and complete authorization and protection in respect of any action taken or
suffered by it hereunder in accordance therewith. The Collateral Agent shall
have the right at any time to seek instructions concerning the administration
of the Trust Estate from any court of competent jurisdiction.
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(b) The Collateral Agent may rely, and shall be fully
protected in acting, upon any resolution, statement, certificate, instrument,
opinion, direction, instruction, report, notice, request, consent, order, bond
or other paper or document which it has no reason to believe to be other than
genuine and to have been signed or presented by the proper party or parties or,
in the case of cables, telecopies and telexes, to have been sent by the proper
party or parties. In the absence of its gross negligence or willful
misconduct, the Collateral Agent may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Collateral Agent and conforming to
the requirements of this Agreement or any Collateral Document.
(c) The Collateral Agent shall not be under any
obligation to exercise any of the rights or powers vested in the Collateral
Agent by this Agreement unless the Collateral Agent shall have been provided
adequate security and indemnity against the costs, expenses and liabilities
that may be incurred by it in compliance with such request or direction,
including, without limitation, such reasonable advances as may be requested by
the Collateral Agent. Nothing in this Agreement shall obligate any Secured
Party or any Person for whom a Secured Party acts as trustee, agent or
fiduciary, as applicable to provide any such security or indemnity or to make
any such advance unless such Secured Party or Person agrees to do so, in its
sole discretion.
8.5 Resignation or Removal of the Collateral Agent. (a)
The Collateral Agent may at any time, (i) by giving 60 days' prior written
notice to the Secured Parties and the Companies, resign and be discharged of
the responsibilities hereby created, such resignation to become effective upon
the appointment of a successor collateral agent or collateral agents by the
Majority Holders and the acceptance of such appointment by such successor
collateral agent or collateral agents or (ii) be removed from its capacity as
the Collateral Agent with or without cause by the Majority Holders. If no
successor collateral agent or collateral agents shall be appointed and approved
within 60 days from the date of the giving of the aforesaid notice of
resignation or within 60 days from the date of such removal, the Collateral
Agent (notwithstanding the termination of all of its other duties
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and obligations hereunder by reason of such resignation or such removal) shall,
or any Secured Party may, apply to any court of competent jurisdiction to
appoint a successor collateral agent or collateral agents to act hereunder.
Any successor collateral agent or collateral agents so appointed by such court
shall immediately and without further act be superseded by any successor
collateral agent or collateral agents appointed by the Majority Holders upon
the acceptance of such appointment by such successor collateral agent or
collateral agents.
(b) If at any time the Collateral Agent shall resign or
otherwise become incapable of acting, or if at any time a vacancy shall occur
in the office of the Collateral Agent by virtue of the removal of the
Collateral Agent pursuant to clause (ii) of Section 8.5(a) or for any other
cause, a successor collateral agent or collateral agents may be appointed by
the Majority Holders, and the powers, duties, authority and title of the
predecessor collateral agent or collateral agents shall be terminated and
cancelled without procuring the resignation of such predecessor collateral
agent or collateral agents, and without any other formality (except as may be
required by applicable law).
(c) The appointment and designation referred to in
subsection 8.5(b) shall, after any required filing, be full evidence of the
right and authority to make the same and of all the facts therein recited, and
this Agreement shall vest in such successor collateral agent or collateral
agents, without any further act, deed or conveyance, all of the estate and
title of its predecessor or their predecessors, and upon such filing for record
the successor collateral agent or collateral agents shall become fully vested
with all the estates, properties, rights, powers, trusts, duties, authority and
title of its predecessor or their predecessors; but such predecessor or
predecessors shall, nevertheless, on the written request of the Majority
Holders, the Companies or its or their successor collateral agent or collateral
agents, execute and deliver an instrument transferring to such successor or
successors all the estates, properties, rights, powers, trusts, duties,
authority and title of such predecessor or predecessors hereunder. Each such
predecessor or predecessors shall deliver all securities and moneys held by it
or them to such successor collateral agent or collateral agents.
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(d) Any required filing for record of the instrument
appointing a successor collateral agent or collateral agents as hereinabove
provided shall be at the expense of the Companies. The resignation of any
collateral agent or collateral agents and the instrument or instruments
removing any collateral agent or collateral agents, together with all other
instruments, deeds and conveyances provided for in this Article 8 shall, if
required by law, be forthwith recorded, registered and filed by and at the
expense of the Companies, wherever this Agreement is recorded, registered and
filed.
8.6 Status of Successors to the Collateral Agent. Every
successor to the Collateral Agent appointed pursuant to Section 8.5 shall be a
bank or trust company in good standing and having power so to act, incorporated
under the laws of the United States or any State thereof or the District of
Columbia, and having its principal corporate trust office within the 48
contiguous States, and shall also have capital, surplus and undivided profits
of not less than $100,000,000, if there be such an institution with such
capital, surplus and undivided profits willing, qualified and able to accept
the trust upon reasonable or customary terms.
8.7 Merger of the Collateral Agent. Any corporation into
which the Collateral Agent may be merged, or with which it may be consolidated,
or any corporation resulting from any merger or consolidation to which the
Collateral Agent shall be a party, shall be the Collateral Agent under this
Agreement without the execution or filing of any paper or any further act on
the part of the parties hereto.
8.8 Appointment of Additional and Separate Collateral
Agent. Whenever (i) the Collateral Agent shall deem it necessary or prudent
(in accordance with the advice or opinion of its counsel) in order to conform
to any law of any jurisdiction in which all or any part of the Collateral shall
be situated or to make any claim or bring any suit with respect to or in
connection with the Collateral, or (ii) the Collateral Agent shall be advised
by counsel satisfactory to it that it is so necessary or prudent in the
interest of the Secured Parties, then, in any such case, the Collateral Agent
shall execute and deliver from time to time all instruments and agreements
necessary or proper to
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constitute another bank or trust company or one or more Persons approved by the
Collateral Agent either to act as additional trustee or trustees of all or any
part of the Trust Estate, jointly with the Collateral Agent, or to act as
separate trustee or trustees of all or any part of the Trust Estate, in any
such case with such powers as may be provided in such instruments or
agreements, and to vest in such bank, trust company or Person as such
additional trustee or separate trustee, as the case may be, any property,
title, right or power of the Collateral Agent deemed necessary or advisable by
the Collateral Agent. The Companies and the Secured Parties hereby consent to
all actions taken by the Collateral Agent under the foregoing provisions of
this Section 8.8.
ARTICLE 9
CERTAIN INTERCREDITOR PROVISIONS
9.1 Contesting Liens or Security Interest. The Collateral
Agent, each Secured Party and, by acceptance of the benefits of this Agreement
and the Collateral Documents, each Person for whom a Secured Party acts as
trustee, agent or fiduciary, as applicable, hereby agree that (a) the liens and
security interests granted to the Collateral Agent under the Collateral
Documents shall be treated, as among the Secured Parties and each of such
Persons, as having equal priority and shall at all times be shared by the
Secured Parties as provided herein, regardless of any claim or defense
(including, without limitation, any claims under the fraudulent transfer,
preference or similar avoidance provisions of applicable bankruptcy, insolvency
or other laws affecting the rights of creditors generally) to which the
Collateral Agent or any Secured Party or any of such Persons may be entitled or
subject and (b) none of them shall contest the validity, perfection, priority
or enforceability of any lien or security interest granted to the Collateral
Agent.
9.2 No Additional Rights for Companies Hereunder. If a
Secured Party shall enforce its rights or remedies in violation of the terms of
this Agreement, the Companies agree that they shall not raise such violation as
a defense to collection or
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enforcement by the other Secured Party with respect to the Indenture Obligation
or the Term Loan Obligation, as the case may be, or assert such violation as a
counterclaim or basis for setoff or recoupment against either Secured Party.
9.3 Concerning Collateral Agent. Notwithstanding anything to
the contrary set forth herein, no provision of this Agreement shall require the
Collateral Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of its duties hereunder, or in the
exercise of any of its powers if it shall have reasonable grounds for believing
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
9.4 Authority. Each of the parties hereto represents and
warrants to all other parties hereto that the execution, delivery and
performance by or on behalf of such party of this Agreement has been duly
authorized by all necessary action, corporate or otherwise, does not violate
any provision of law, governmental regulation, or any agreement or instrument
by which such party is bound, and requires no governmental or other consent
that has not been obtained and is not in full force and effect.
ARTICLE 10
TERMINATION; EXPIRATION OF CERTAIN RIGHTS
10.1 Termination. This Agreement shall terminate when all
amounts owing in respect of all the Secured Obligations shall have been paid in
full in cash.
10.2 Amendment of Collateral Documents. Subject to the
requirements of Sections 2.2, 3.2(c) and 4.5 hereof, the Majority Holders
(provided that the Majority Holders include the Term Loan Note Majority
Holders) shall have the exclusive authority to direct the Collateral Agent to
amend, supplement or waive any provision of any Collateral Document or to
direct the Collateral Agent to forebear from enforcing any provision of any
Collateral Document; provided, however, that no such amendment, supplement or
waiver shall affect the right of any Secured Party
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(or any Person for whom a Secured Part acts as trustee, agent or fiduciary) not
consenting thereto in writing to equal and ratable security under the
Collateral Documents. In addition, no amendment or modification to any of the
Collateral Documents shall impose any additional obligations or
responsibilities upon any Secured Party or otherwise adversely effect its
rights hereunder without the consent of each of the Secured Parties affected
thereby.
ARTICLE 11
MISCELLANEOUS
11.1 Amendments to Financing Arrangements or to This
Agreement. The Collateral Agent, the Term Loan Agent and the Trustee shall
each use its best efforts to notify the other or others of any amendment,
modification or waiver to any document evidencing or securing the Secured
Obligations, but the failure to do so shall not create a cause of action
against the party failing to give such notice or create any claim or right on
behalf of any third party. Each of the parties shall, upon request of the
other or others, provide copies of all such modifications, amendments and
waivers and copies of all other documentation relevant to the Collateral. All
modifications, amendments and waivers of this Agreement must be in writing and
duly executed by an authorized officer of the Collateral Agent and each Secured
Party to be binding and enforceable, and the written consent of the Companies
shall be required only if the amendment, modification or waiver would impose,
or have the effect of imposing, on the Companies, more restrictive covenants or
greater obligations than those applicable to the Companies under this
Agreement, which consent shall not be unreasonably withheld, provided, however,
the written consent of the Companies shall not be required with respect to an
amendment of this Agreement pursuant to clause (b) of Section 3.11.
11.2 Notices, Distributions and Payments. (a) In each
case herein or in any Collateral Document where any payment or distribution is
to be made or notice is to be given to Secured Parties, (i) such payments,
distributions and notices in respect of the Indenture Obligation shall be made
to the Trustee for the
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benefit of the Holders and (ii) such payments, distributions and notices in
respect of the Term Loan Obligation shall be made to the Term Loan Agent for
the benefit of the Term Loan Lenders.
(b) All notices requests, demands and other communications
provided for or permitted hereunder shall be in writing (including telex and
telecopy communications) and shall be sent by mail, telex, telecopier or hand
delivery:
(i) If to any of the Companies, to such Company at the
following address:
4200 NationsBank Center
700 Louisiana Street
Houston, Texas 77002
Attention: Vice President, General Counsel
and Secretary
(ii) If to the Collateral Agent, to the following address:
United States Trust Company of New York
114 West 47th Street
New York, New York 10036
Attention: Corporate Trust Department
(iii) If to the Trustee, to the following address:
United States Trust Company of New York
114 West 47th Street
New York, New York 10036
Attention: Corporate Trust Department
(iv) If to the Term Loan Agent, to the following address:
Bank of America Illinois
231 South LaSalle Street
8th Floor
Chicago, Illinois 60697
Attention: Agency
Management Services
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(v) If to the Agent Bank, to the following address:
Bank of America Illinois
231 South LaSalle Street
8th Floor
Chicago, Illinois 60697
Attention: Agency
Management Services
All such notices, requests, demands and communications shall be deemed to have
been duly given or made, when delivered by hand or five business days after
being deposited in the mail, postage paid, when telexed answer back received
and when telecopied, receipt acknowledged. Any party hereto may change its
address set forth in this Section 11.2(b) by notice to the other parties given
in accordance with the provisions of this Section 11.2(b).
11.3 Headings. Headings used in this Agreement are for
convenience only and shall not affect the construction of this Agreement.
11.4 Severability. Any provision of this Agreement that 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.
11.5 Dealings with the Companies. Upon any application or
demand by the Companies to the Collateral Agent to take or permit any action
under any of the provisions of this Agreement or under any Collateral Document,
the Companies shall furnish to the Collateral Agent an officers' certificate
and opinion of counsel stating that all conditions precedent, if any, provided
for in this Agreement or such Collateral Document, as the case may be, relating
to the proposed action have been complied with, except that in the case of any
such application or demand as to which the furnishing of such documents is
specifically required by any provision of this Agreement or any Collateral
Document relating to such particular application or demand, no additional
certificate or opinion need be furnished.
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11.6 Binding Effect. This Agreement shall be binding upon
and inure to the benefit of each of the parties hereto and shall inure to the
benefit of the Secured Parties (and the Persons for whom the Secured Parties
act as trustee, agent or fiduciary, as applicable) and their respective
successors and assigns and nothing herein or in any Collateral Document is
intended or shall be construed to give any other Person any right, remedy or
claim under, to or in respect of this Agreement, the Collateral or the Trust
Estate.
11.7 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
11.8 Counterparts. This Agreement may be executed in
separate counterparts, each of which shall be an original and all of which
taken together shall constitute one and the same instrument.
11.9 Execution by Agent Bank. The Agent Bank has executed
and delivered this Agreement solely for purposes of agreeing to, and receiving
the benefits of, the provisions of Section 2.2(c), (d) and (e) hereof.
11.10 FORUM SELECTION AND CONSENT TO JURISDICTION. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY RELATING HERETO SHALL BE BROUGHT AND
MAINTAINED EXCLUSIVELY (TO THE EXTENT PERMITTED UNDER APPLICABLE LAW) IN THE
COURTS OF THE STATE OF NEW YORK, NEW YORK COUNTY, OR IN THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT
SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE
BROUGHT, AT THE COLLATERAL AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION
WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE OBLIGORS HEREBY
EXPRESSLY AND IRREVOCABLY SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE
OF NEW YORK, NEW YORK COUNTY, AND OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET
FORTH ABOVE AND IRREVOCABLY AGREE TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY
IN CONNECTION WITH SUCH LITIGATION. THE
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OBLIGORS IRREVOCABLY CONSENT TO THE SERVICE OF PROCESS BY REGISTERED MAIL,
POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW
YORK. EACH OBLIGOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE
TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. TO THE EXTENT THAT ANY OBLIGOR HAS OR HEREAFTER MAY
ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN
AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, SUCH
OBLIGOR HEREBY IRREVOCABLY WAIVES (TO THE EXTENT PERMITTED UNDER APPLICABLE
LAW) SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT.
11.11 WAIVER OF JURY TRIAL. EACH PARTY HERETO KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN
CONNECTION WITH, THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF ANY PARTY RELATING HERETO.
EACH OBLIGOR ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT
CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION HEREOF AND OF EACH
OTHER DOCUMENT DESCRIBED HEREIN TO WHICH IT IS A PARTY) AND THAT THIS PROVISION
IS A MATERIAL INDUCEMENT FOR THE COLLATERAL AGENT AND SECURED PARTIES ENTERING
INTO THIS AGREEMENT AND EACH SUCH OTHER DOCUMENT.
[Signature page follows.]
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement or caused this Agreement to be duly executed by their respective
officers thereunto duly authorized as of the day and year first above written.
UNITED STATES TRUST COMPANY OF
NEW YORK, as Trustee
By /s/ JAMES J. MCGINLEY
----------------------------
Name: James J. McGinley
Title: Vice President
BANK OF AMERICA ILLINOIS, as
Term Loan Agent
By /s/ DAVID A. JOHANSON
----------------------------
Name: David A. Johanson
Title: Vice President
UNITED STATES TRUST COMPANY
OF NEW YORK, as
Collateral Agent
By /s/ JAMES J. MCGINLEY
----------------------------
Name: James J. McGinley
Title: Vice President
PIONEER AMERICAS ACQUISITION
CORP.
By /s/ PHILIP J. ABLOVE
----------------------------
Name: Philip J. Ablove
Title: Vice President
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PIONEER CHLOR ALKALI COMPANY,
INC.
By /s/ PHILIP J. ABLOVE
----------------------------
Name: Philip J. Ablove
Title: Vice President
PIONEER AMERICAS, INC.
By /s/ PHILIP J. ABLOVE
----------------------------
Name: Philip J. Ablove
Title: Vice President
BANK OF AMERICA ILLINOIS, as
Agent Bank
By /s/ DAVID A. JOHANSON
----------------------------
Name: David A. Johanson
Title: Vice President