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EXHIBIT 4.10
INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT
INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT dated as of this
30th day of October, 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 NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Administrative Agent for its own benefit and for the benefit of
the Term Loan Lenders (as hereinafter defined) under the Term Loan Agreement
(as hereinafter defined) (in such capacity, the "Term Loan Agent"), BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as Agent under the Revolving
Credit Agreement (as hereinafter defined) (in such capacity, the "Agent Bank"),
UNITED STATES TRUST COMPANY OF NEW YORK, as collateral agent (the "Collateral
Agent"), PCI CHEMICALS CANADA INC. ("PCI Canada"), PIONEER AMERICAS, INC.
("PAI") and PIONEER AMERICAS ACQUISITION CORP. ("PAAC" and together with PCI
Canada 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 PCI Canada, the
Guarantors (as defined therein) and the Trustee, as trustee for the holders
(the "Holders") of the Notes (as hereinafter defined), PCI Canada 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 $175 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 PAI,
PAAC, as parent guarantor, the Term Loan Agent, DLJ Capital Funding, Inc., as
syndication agent, Salomon Brothers Holding Company Inc, as documentation
agent, and the lenders from time to time parties thereto (the "Term Loan
Lenders"), the Term Loan Lenders will make loans to PAI to be evidenced by,
among other things, certain promissory 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 "U.S. Term
Loan Notes") in an aggregate principal amount of up to $100 million and a Bond
(Quebec Law) (as the same may be amended,
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amended and restated, supplemented or otherwise modified from time to time,
including all bonds issued in exchange or substitution therefor, the "Bond" and
together with the U.S. Term Loan Notes, the "Term Loan Notes").
C. PAAC has entered into a Loan and Security Agreement,
dated as of June 17, 1997, as amended by a Consent and Amendment, dated as of
the date hereof (as the same may be further amended, amended and restated,
supplemented or otherwise modified from time to time, the "Revolving 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") have agreed to provide certain
revolving loan and letter of credit facilities to PAI in an aggregate principal
or face amount not in excess of $65 million.
D. Pursuant to the Guaranty dated as of the date hereof,
PCI Canada has guaranteed (such guarantee by PCI Canada being hereinafter
referred to as the "Term Loan Guarantee") the payment and performance of the
Term Loan Obligations (as hereinafter defined).
E. PCI Canada (or, in the case of the Bond Pledge
Agreement described in clause (ii) below, PAI) has executed and delivered (or
will execute and deliver) the following documents (collectively, and as
amended, amended and restated, supplemented or otherwise modified from time to
time, the "Security Documents") to the Collateral Agent to secure the payment
and performance of its obligations under the Indenture, the U.S. Term Loan
Notes, the Bond and the Term Loan Guarantee, as applicable:
(i) Deed of Hypothec (the "Deed of Hypothec") dated as of
the date hereof in respect, inter alia, of certain premises in Becancour,
Quebec by PCI Canada, as grantor, to the Collateral Agent, for its own account
and for the account of the Trustee, the Term Loan Agent, the Holders and the
Term Loan Lenders;
(ii) Bond Pledge Agreement dated as of the date hereof in
respect, inter alia, of the Bond to the Collateral Agent for its own account
and for the account of the Trustee, the Term Loan Agent, the Holders and the
Term Loan Lenders;
(iii) Demand Debenture (the "New Brunswick Debenture") in
the principal amount of $500,000,000 dated as of the date hereof in respect,
inter alia, of certain premises in Dalhousie, New Brunswick, by PCI Canada to
the Collateral Agent, as beneficiary, for the benefit of the Trustee, the Term
Loan Agent, the Holders and the Term Loan Lenders;
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(iv) Debenture Pledge Agreement dated as of the date
hereof in respect of the New Brunswick Debenture by PCI Canada, to the
Collateral Agent, for the benefit of the Trustee, the Term Loan Agent, the
Holders and the Term Loan Lenders; and
(v) Demand Debenture (the "Ontario Debenture") in the
principal amount of $500,000,000 dated as of the date hereof in respect, inter
alia, of certain premises in Cornwall, Ontario and Mississauga, Ontario, by PCI
Canada to the Collateral Agent, as beneficiary, for the benefit of the Trustee,
the Term Loan Agent, the Holders and the Term Loan Lenders;
(vi) Debenture Pledge Agreement dated as of the date
hereof in respect of the Ontario Debenture by PCI Canada, to the Collateral
Agent, for the benefit of the Trustee, the Term Loan Agent, the Holders and the
Term Loan Lenders; and
(vii) Demand Debenture (the "Nova Scotia Debenture") in the
principal amount of $500,000,000 dated as of the date hereof in respect, inter
alia, of certain premises in Point Tupper, Nova Scotia, by PCI Canada to the
Collateral Agent, as beneficiary, for the benefit of the Trustee, the Term Loan
Agent, the Holders and the Term Loan Lenders;
(viii) Debenture Pledge Agreement dated as of the date
hereof in respect of the Nova Scotia Debenture by PCI Canada, to the Collateral
Agent, for the benefit of the Trustee, the Term Loan Agent, the Holders and the
Term Loan Lenders; and
(ix) Borrower (Canadian) Security Agreement; Patent
Security Agreement; Trademark Security Agreement; and Copyright Security
Agreement (collectively, and as each of the same may be amended, amended and
restated, supplemented or otherwise modified from time to time, the "General
Security Agreement") dated as of the date hereof by PCI Canada, as grantor, to
the Collateral Agent, as secured party, for the benefit of the Trustee, the
Term Loan Agent, the Holders and the Term Loan Lenders.
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 Deed of
Hypothec and the Debenture as in effect on the date of execution of this
Agreement.
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(b) The following terms shall have the respective
meanings set forth below:
"Agent Bank" is defined in the first paragraph of this
Agreement.
"Asset Sale Release Notice" is defined in Section 3.2(b)(i) of
this Agreement.
"Bank Lenders" is defined in Recital C of this Agreement.
"Bond" is defined in Recital B of this Agreement.
"Collateral" means the Hypothecated Property (as defined in
the Deed of Hypothec), the Collateral (as defined in the Debenture and as
defined in the General Security Agreement), the New Collateral and any other
property or assets (including, without limitation, the St. Gabriel Pipeline, as
defined in the Indenture) 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" is defined in Section 5.1 of this
Agreement.
"Collateral Agent" is defined in the first paragraph of this
Agreement.
"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
of this Agreement.
"Collateral Documents" means, collectively, (i) the Security
Documents, (ii) this Intercreditor and Collateral Agency Agreement, (iii) the
documentation relating to the Collateral Account and (iv) all hypothecs,
debentures, security agreements, mortgages, deeds of trust, pledges, collateral
assignments or any other instruments (including, without limitation, the
Pipeline Security Documents, as defined in the Indenture, and the Affiliate
Security Agreements, as defined in the Term Loan Agreement) evidencing or
creating any security interest in favor of the Collateral Agent for the benefit
of the Secured Parties or in favor of the Collateral Agent for its account and
for the account 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" is defined in the first paragraph of this
Agreement.
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"Debenture" means, collectively, the New Brunswick Debenture,
the Ontario Debenture and the Nova Scotia Debenture.
"Debt Instrument" means each of the Notes, the Bond and the
U.S. Term Loan Notes.
"Deed of Hypothec" is defined in Recital E(i) of this
Agreement.
"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 of this Agreement.
"Enforcement Notice" is defined in Section 2.2(a) of this
Agreement.
"Event of Default" means an Event of Default under the Term
Loan Agreement or under the Indenture, as the case may be.
"Excepted Liens" shall mean (a) Liens for taxes, assessments
or other governmental charges or levies not yet due or which are being
contested in good faith by appropriate action and for which appropriate
reserves have been maintained; (b) operators', vendors', carriers',
warehousemen's, repairmen's, mechanics', workmen's, materialmen's, construction
or other like Liens arising by operation of law in the ordinary course of
business or statutory landlord's liens; (c) any Liens reserved in leases for
rent and for compliance with the terms of the leases in the case of leasehold
estates, to the extent that any such Lien referred to in this clause does not
materially impair the use of the Collateral covered by such Lien for the
purposes for which such Collateral is held by PCI Canada or materially impair
the value of such Collateral subject thereto; (d) the registrations described
in the Title Opinion with respect to such Collateral; and (e) Liens and
encumbrances (other than to secure the payment of borrowed money or the
deferred purchase price of Collateral or services), easements, restrictions,
servitudes, permits, conditions, covenants, exceptions or reservations in any
rights of way for the purpose of roads, pipelines, transmission lines,
transportation lines, distribution lines for the removal of gas, oil, coal or
other minerals or timber, and other like purposes, or for the joint or common
use of real estate, rights of way, facilities and equipment, and defects,
irregularities, zoning restrictions and deficiencies in title to the Collateral
which in the aggregate do not prevent the use of the Collateral for the
purposes for which it is currently held by PCI Canada or have a Material
Adverse Effect on the Companies taken as a whole.
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"General Security Agreement" is defined in Recital E(ix) of
this Agreement.
"Holders" is defined in Recital A of this Agreement.
"Indenture" is defined in Recital A of this Agreement.
"Indenture Obligations" means any and all indebtedness,
obligations and liabilities of PCI Canada now or hereafter existing under or in
respect of the Notes, including, without limitation, payment of principal,
premium, if any, interest and Liquidated Damages (as defined in the Indenture),
if any, when due and payable, and all other amounts due or to become due under
or in connection with the Indenture (including, without limitation, all sums
due to the Trustee pursuant to Section 606 thereof), the Notes and the
performance of all other obligations to the Trustee and the holders of the
Notes under the Indenture and the Notes, according to the terms thereof.
"Lien" means any interest in Collateral owed to, or a claim by
a Person, whether such interest is based on the common law, statute or
contract, and whether such obligation or claim is fixed or contingent, and
including but not limited to the lien or security interest arising from a
hypothec, debenture, debenture pledge, encumbrance, pledge, security agreement,
conditional sale or trust receipt or a lease, consignment or bailment for
security purposes. The term "Lien" shall include prior claims (within the
meaning of the Civil Code of Quebec) reservations, exceptions, encroachments,
easements, rights of way, covenants, conditions, restrictions, leases and other
title exceptions and encumbrances affecting the Collateral.
"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.
"Material Adverse Effect" shall mean, as to any Person, asset
or Property, a material adverse effect on the business, assets, properties,
condition (financial or other), operations or results of operations of such
Person, asset or Property, which effect is not adequately and effectively
insured or indemnified against by a financially sound insurance company, and
excepting effects arising solely out of general national economic
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conditions and/or effects arising solely out of matters affecting the industry
in which such Person, asset or Property conducts business as a whole.
"New Brunswick Debenture" is defined in Recital E(iii) of this
Agreement.
"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.
"Notes" is defined in Recital A of this Agreement.
"Nova Scotia Debenture" is defined in Recital E(vii) of this
Agreement.
"Obligor" means PCI Canada and any other grantor, pledgor or
assignor under a Collateral Document.
"Obligor Collateral" is defined in the Revolving Credit
Agreement. As used in this definition, "Revolving Credit Agreement" shall mean
the Revolving Credit Agreement as in effect on the date hereof.
"Officers' Certificate" is defined in the Indenture as in
effect on the date hereof.
"Ontario Debenture" is defined in Recital E(v) of this
Agreement.
"Opinion of Counsel" has the meaning set forth in the
Indenture as in effect on the date hereof.
"Other Released Interest" is defined in Section 3.2(c) of this
Agreement.
"Other Valuation Date" is defined in Section 3.2(c)(i) of this
Agreement.
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"PAAC" is defined in the first paragraph of this Agreement.
"PAI" is defined in the first paragraph of this Agreement.
"Person" shall mean any individual, corporation, legal person,
company, voluntary association, partnership, joint venture, trust,
unincorporated organization or government or any agency, instrumentality or
political subdivision thereof, or any other form of entity.
"PCI Canada" is defined in the first paragraph of this
Agreement.
"Property" shall mean any interest in any kind of property or
asset, whether real, personal or mixed, or tangible or intangible.
"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 Obligations or Term
Loan Obligations, 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.
"Quebec Secured Party" means each of the Holders, the Trustee,
the Term Loan Lenders and the Term Loan Agent, and their respective successors
and assigns.
"Real Property" means any interest in any real property or any
portion thereof, whether owned in fee or leased or otherwise owned.
"Release Notice" is defined in Section 3.2(c)(i) of this
Agreement.
"Released Interests" is defined in Section 3.2(b) of this
Agreement.
"Released Trust Moneys" is defined in Section 4.4 of this
Agreement.
"Revolving Credit Agreement" is defined in Recital C of this
Agreement.
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"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.
"Security Documents" is defined in Recital E of this
Agreement.
"Survey" means a survey or certificate of location 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 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 Agent" is defined in the first paragraph of this
Agreement.
"Term Loan Agreement" is defined in Recital B of this
Agreement.
"Term Loan Asset Sale" is defined in Section 3.2(b) of this
Agreement.
"Term Loan Collateral Proceeds" is defined in Section
3.2(b)(iv) of this Agreement.
"Term Loan Guarantee" is defined in Recital D of this
Agreement.
"Term Loan Lenders" is defined in Recital B of this Agreement.
"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
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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 Notes" is defined in Recital B of this Agreement.
"Term Loan Obligations" means any and all indebtedness,
obligations and liabilities of PCI Canada and PAI now or hereafter existing
under or in respect of the Term Loan Guarantee and the Term Loan Notes,
including, without limitation, payment of principal, premium, if any, and
interest when due and payable, and all other amounts due or to become due under
or in connection with the Term Loan Agreement (including, without limitation,
all sums due to the Term Loan Agent pursuant to Section 11.3 and 11.4 thereof)
and the Term Loan Notes and the performance of all other obligations to the
Term Loan Agent and the Term Loan Lenders under the Term Loan Agreement and the
Term Loan Notes according to the terms thereof.
"Title Opinions" means the title opinions delivered to the
Collateral Agent with respect to the registration of the Liens under the
Security Documents.
"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.
"Total Net Proceeds" is defined in Section 6.1(a) of this
Agreement.
"Trustee" is defined in the first paragraph of this Agreement.
"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 Opinions and (iii) any amounts from
time to time held in the Collateral Account.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended.
"Trust Moneys" is defined in Section 4.1 of this Agreement.
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"U.S. Term Loan Notes" is defined in Recital B of this
Agreement.
"Valuation Date" is defined in Section 3.2(b)(i) of this
Agreement.
(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 The Collateral Agent hereby declares, and the
Companies agree that, for purposes of constituting security in the Collateral
located in the Province of Quebec, the Collateral Agent has received a Power of
Attorney (within the meaning of the Civil Code of Quebec) from and for all and
each of the Quebec Secured Parties for the purposes of holding, on behalf of
and for the benefit of all of the Quebec Secured Parties, the security
constituted by the Deed of Hypothec. The Collateral Agent, for itself and its
successors, confirms its acceptance of such Power of Attorney.
2.1A 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, grantee or beneficiary, as the case may be,
in trust or under power of attorney (within the meaning of the Civil Code of
Quebec) 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) or the Quebec
Secured Parties, as the case may be, 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 and attorney-in-fact of such Secured Party (or Person, as
applicable) to make claims under and otherwise act in all respects as the
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beneficiary of the Title Opinions, 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 remedies or give any such consents or approvals
relating to any Collateral or the Collateral Documents or itself make any claim
under the Title Opinions.
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 or the Quebec Secured Parties, as the case may be,
(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, that the Collateral Agent shall have no
obligation to take any actions outside the Enforcement Notice.
(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 PCI Canada and PAI 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
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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 Revolving Credit Agreement, to pursue
remedies with respect to Obligor Collateral in accordance with the provisions
of the Revolving 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 Collateral, shall permit the Agent Bank to access, occupy and
use the Collateral, in each case without rent, for a period not to exceed 90
days from the date the Agent Bank receives written notice from the Collateral
Agent that it has acquired possession of the Collateral, 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 Collateral (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.
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
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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 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
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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.
ARTICLE 3
COLLATERAL DOCUMENTS
3.1 Recording; Priority; Opinions, Etc. (a) Each Obligor
shall at its 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, any statute, rule or regulation
of any applicable United States or Canadian federal, state, provincial or local
jurisdiction, including any filings or registrations in local real estate land
record offices or registry 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 create, grant, maintain, register, record, file,
perfect, protect, renew and preserve in favor of the Collateral Agent for the
benefit of the Secured Parties or for its account and the account of the Quebec
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 recording, registration 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
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generality of the foregoing, if at any time the Trustee, the Term Loan Agent or
the Collateral Agent shall determine that additional recording, filing,
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 grants of liens
or 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
Collateral Documents has been properly registered, recorded, renewed
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,
renewals and filings are the only recordings, registrations and
filings necessary to give notice thereof and that no re-recordings,
re-registrations, renewals 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, renewals, 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,
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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, and
subject to applicable laws of Canada and provinces of Canada, the Obligors
shall cause Trust Indenture Act Section 314(d) relating to the release of
property or Liens to be complied with.
(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 PCI Canada's
obligations under the Indenture and all of PAI's obligations under Section
10.12 of the Term Loan Agreement for complete satisfaction of all of PAI's
obligations under the Term Loan Agreement and the termination thereof. Upon
delivery by PCI Canada and PAI, respectively, 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
PCI Canada, promptly direct the Collateral Agent to release and reconvey to PCI
Canada all of the 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 PCI Canada.
(b) Sales of Collateral Permitted by Section 1009 of the
Indenture and Section 7.2.6 of the Term Loan Agreement. PCI Canada 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 Collateral Documents, 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 PCI Canada 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, (B)
attach all the documents referred to below, (C) describe
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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
Canadian counsel to PCI shall have committed to issue to the
Collateral Agent a title opinion relating to the affected property,
confirming that after such release, the Lien of the applicable
Collateral Documents shall continue unimpaired as a first priority
perfected Lien upon the remaining Collateral encumbered thereby
subject only to Excepted Liens and that the remaining Collateral
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
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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 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 PCI Canada
desires to release any Collateral not otherwise permitted by Section 3.2(b) or
3.3 of this Agreement (the "Other Released Interest"), PCI Canada, 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
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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 PCI Canada 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 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
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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).
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. Any 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 (as in effect on the
date hereof) 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, PCI Canada 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, PCI Canada 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 PCI Canada 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 Section 3.3 may be
sold, exchanged or otherwise disposed of by PCI Canada without any release or
consent of the Collateral Agent, and PCI Canada 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
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execute such an instrument upon delivery to the Trustee, the Term Loan Agent
and the Collateral Agent of (i) an Officers' Certificate by PCI Canada 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 by
PCI Canada 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 PCI Canada 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, Expropriation and Other Governmental
Takings. Subject to the provisions of the Collateral Documents, should any of
the Collateral be taken by eminent domain or expropriation or be sold pursuant
to the exercise by Canada or any state, province, 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 or
expropriation and the amount of the award therefor, or that such property has
been sold pursuant to a right vested in Canada or a state, province,
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 expropriation, or
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has been sold pursuant to the exercise of a right vested in Canada or
a state, province, 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 or
expropriation, that the award for the property so taken has become
final or that appeal from such award is not advisable in the interests
of the Companies 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
PCI Canada 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 expropriation or by virtue of any
such right to purchase or designate a purchaser or to order a sale, the
Collateral Agent may be represented by counsel who may be counsel for PCI
Canada.
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
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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 PCI Canada 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 PCI Canada 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 of PCI Canada 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 PCI Canada
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
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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
PCI Canada 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
PCI Canada, 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.
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 Collateral. All Liens on any Property of
the Companies or any Guarantor (as defined in the Indenture) at any time
granted to secure any Secured Obligation shall constitute Collateral for the
purposes of this Agreement and
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shall be held by the Collateral Agent for the pari passu benefit of the Secured
Parties.
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 the terms of the Collateral Documents; 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 the terms of the Collateral
Documents in respect of the sale or other disposition of all or any part of the
Collateral taken by eminent domain or expropriation 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.
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
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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 PAI or
PCI Canada pursuant to Section 4.2 hereof to be applied to effect a Restoration
in accordance with the applicable Security Document; (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 PAI
and PCI Canada pursuant to Sections 4.3 or 4.4 hereof to be applied to a
reinvestment in PAI 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 held by the
Collateral Agent as Excess Proceeds (as defined in the Indenture) and shall be
transferred to the Trustee as and when required in connection with an Asset
Sale Offer in respect of such Excess Proceeds pursuant to Section 1009 of the
Indenture.
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 the
Security Documents and such Insurance Proceeds or Net Awards may be applied by
PAI or PCI Canada to effect a Restoration of the affected Collateral, such
Trust Moneys may be withdrawn by PAI or PCI Canada 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
PAI or PCI Canada, as applicable, dated not more than 30 days prior to the date
of the application for the withdrawal and payment of such Trust Moneys:
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(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 PAI or PCI Canada;
(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;
(iv) that the property to be repaired, rebuilt or replaced
is necessary or desirable in the conduct of the business of PAI or PCI
Canada, as the case may be;;
(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:
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(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 PAI or PCI
Canada, as the case may be, 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 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 Security Document) 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 Security Document) 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 Security Document) 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
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Collateral Agent under an Additional Undertaking (as defined in the
applicable Security Document) 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);
(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 satisfactory to the Collateral
Agent confirming that there has not been filed with respect to all or
any part of the applicable Collateral any Lien which is not either
discharged of record or bonded and which could have priority over the
Lien of the applicable Security Document; 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 the
Obligors, 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 (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
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repayment or prepayment of Senior Indebtedness (as defined in the Indenture as
in effect on the date hereof) in accordance with the terms of such Senior
Indebtedness and pursuant to Section 7.2.6(c) of the Term Loan Agreement and
Section 1009(b)(i) 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 (as
defined in the Indenture), 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 the
Indenture or the Term Loan Agreement or Event of Default under either
the Indenture or the Term Loan Agreement exists unless such Default or
Event of Default would be cured by the application of Trust Moneys and
that no such Default or Event of Default would result from such
application, and (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
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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 PCI Canada 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 PAI or PCI Canada, as the
case may be, and shall be paid by the Collateral Agent to PAI or PCI Canada (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:
(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;
(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
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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
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 PAI and
PCI Canada, intend to reinvest such Term Loan Collateral Proceeds in PAI or in
one or more Restricted Subsidiaries in a Related Business (the "Released Trust
Moneys"), such Trust Moneys may be withdrawn by PAI and PCI Canada and shall be
paid by the Collateral Agent to PAI and PCI Canada (or as otherwise directed by
PAI and PCI Canada) 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
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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:
(i) a hypothec, mortgage, debenture, pledge or other
instrument or instruments in recordable form sufficient to grant to
the Collateral Agent for the benefit of the Secured Parties or for its
own account and for the account of the Quebec Secured Parties, as the
case may be, (A) substantially the same rights and remedies in respect
of such Real Property as granted thereto under the Security Documents
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 Security Documents delivered
on the date hereof and, if the Real Property is a leasehold or
easement interest, such hypothec, mortgage, debenture, pledge 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, application for
registration and other instruments as may be necessary to perfect such
Lien;
(ii) a title opinion verifying that the Lien of the
instruments delivered pursuant to clause (i) above constitutes a valid
and perfected first priority 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 opinion are Excepted Liens, together
with opinions of the type included in the Title Opinions delivered to
the Collateral Agent on the date hereof with respect to the
Collateral;
(iii) in the event such Real Property has a fair market
value in excess of $250,000, a Survey with respect thereto;
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(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;
(v) an Officers' Certificate stating that PAI 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 and searches under relevant provincial personal
property security legislation, (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 or for its own account
and the account of the Quebec Secured Parties, as the case may be, (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
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(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 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 PAI.
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
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.
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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 and the
Quebec Secured Parties, as the case may be, have been paid to such Secured
Parties and the Quebec Secured Parties, as the case may be, 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 and the Quebec Secured Parties, as the case may be. 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 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
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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 Security Documents) 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 Opinions) 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 PAI or the successors or assigns of PAI, 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 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 Security Document, the proceeds of such
exercise of remedies shall be applied, notwithstanding Section 6.1, solely to
the obligation being accelerated.
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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 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.
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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 filing, 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, renewal 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 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.
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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.
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
PCI Canada, 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 PCI Canada 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
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of the covenants or agreements contained herein, in any Collateral Document or
in any Debt Instrument or other document 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.
(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
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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 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
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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
Section 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.
(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
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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 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. Each Company,
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 or to the
Collateral Agent for its account and for the account of the Quebec Secured
Parties, as the case may be, under the Collateral Documents shall be treated,
as among the Secured Parties and the Quebec Secured Parties, as the case may
be, and each of such Persons, as having equal priority and shall at all times
be shared by the Secured Parties and the Quebec Secured Parties, as the case
may be, as provided herein, regardless of any claim or defense (including,
without limitation, any claims under the fraudulent transfer, preference or
similar avoidance
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provisions of applicable bankruptcy, insolvency or other laws affecting the
rights of creditors generally) to which the Collateral Agent or any Secured
Party or Quebec Secured Party, as the case may be, 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 or any obligation secured by any such lien or security
interest.
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 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
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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 (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 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 Obligations shall be made
to the Trustee for the benefit of the Holders and (ii) such payments,
distributions and notices in respect of the Term Loan Obligations shall be made
to the Term Loan Agent for the benefit of the Term Loan Lenders.
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(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 National Trust
and Savings Association
231 South LaSalle Street
8th Floor
Chicago, Illinois 60697
Attention: Agency
Management Services
(v) If to the Agent Bank, to the following address:
Bank of America National Trust
and Savings Association
231 South LaSalle Street
8th Floor
Chicago, Illinois 60697
Attention: Agency
Management Services
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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.
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.
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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) and (d) 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, IN ANY SUIT BY THE COLLATERAL AGENT, SEEKING ENFORCEMENT
AGAINST COLLATERAL OR OTHER PROPERTY, TO THE JURISDICTION OF THE COURTS OF ANY
JURISDICTION WHERE SUCH COLLATERAL OR PROPERTY MAY BE FOUND) AND IRREVOCABLY
AGREE TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH
LITIGATION. THE 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
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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.]
52
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/ PATRICIA STERMER
---------------------------------
Name: PATRICIA STERMER
Title: ASSISTANT VICE PRESIDENT
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, 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/ PATRICIA STERMER
---------------------------------
Name: PATRICIA STERMER
Title: ASSISTANT VICE PRESIDENT
PCI CHEMICALS CANADA INC.
By /s/ PHILIP J. ABLOVE
---------------------------------
Name: Philip J. Ablove
Title: Vice President and
Chief Financial Officer
PIONEER AMERICAS
ACQUISITION CORP.
By /s/ PHILIP J. ABLOVE
---------------------------------
Name: Philip J. Ablove
Title: Vice President and
Chief Financial Officer
PIONEER AMERICAS, INC.
By /s/ PHILIP J. ABLOVE
---------------------------------
Name: Philip J. Ablove
Title: Vice President and
Chief Financial Officer
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as
Agent Bank
By /s/ DAVID A. JOHANSON
---------------------------------
Name: David A. Johanson
Title: Vice President