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Exhibit 10.12 (vi)
COLLATERAL ASSIGNMENT OF CONTRACTS
THIS COLLATERAL ASSIGNMENT OF CONTRACTS ("Assignment") dated as of
January 14,1997 is entered into by Credentials Services International, Inc., a
Delaware corporation ("Assignor"), and LaSalle National Bank ("Assignee").
Recitals:
A. Assignor and Assignee have entered into a certain Credit
Agreement of even date herewith (as amended, restated or otherwise modified and
in effect from time to time, the "Credit Agreement"), pursuant to which
Assignee has agreed, subject to the terms and conditions thereof, to make loans
and other financial accommodations to Assignor from time to time.
B. Assignee has required, as a condition to its entering into the
Credit Agreement, that Assignor execute and deliver this Assignment
NOW, THEREFORE, in consideration of the premises and to induce
Assignee to enter into the Credit Agreement and to make loans and financial
accommodations to Assignor thereunder, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereby agree as follows:
1. Definitions. Capitalized terms used herein without definition
are used herein as defined in the Credit Agreement. In addition, the following
terms shall have the following meanings:
"Assigned Contracts" shall mean (a) the Acquisition Agreement, (b) the
Management Agreement, (c) the Significant Vendor Contracts and (d) the Service
Agreement.
"Assignment"shall mean this Assignment, as amended, restated or
otherwise modified from time to time as permitted hereunder.
2. Assignment for Security. As collateral security for the
prompt payment in full when due (whether at stated maturity, by acceleration or
otherwise) of the Obligations, Assignor hereby assigns, transfers and sets over
to Assignee all of Assignor's right, title and interest in and to each of the
Assigned Contracts, including, without limitation, except to the extent
reserved below, (a) the right upon valid tender to accept any goods or services
provided under each of the Assigned Contracts, (b) all claims for damages in
respect of the Assigned Contracts arising as a result of any default under the
Assigned Contracts, (c) any and all rights of the Assignor to compel
performance of the terms of the Assigned Contracts, (d) all rights, benefits
and claims under all warranty and indemnity provisions contained in the
Assigned Contracts, (e) the benefit of all insurance payments provided for in
the Assigned Contracts and (f) the right to any other monies due and to become
due to the Assignor under the Assigned Contracts. Notwithstanding the
foregoing, so long as no Event of Default shall have occurred and be
continuing, Assignor shall retain all rights to exercise all rights and powers
under the Assigned Contracts.
3. Assignor to Remain Liable. It is expressly agreed that
anything herein to the contrary notwithstanding, Assignor shall remain liable
under the Assigned Contracts to perform all of its obligations thereunder and
Assignee shall have no obligation or liability under the Assigned Contracts by
reason of, or arising out of, this Assignment nor shall Assignee be required or
obligated in any manner to perform or fulfill any obligations of Assignor under
or pursuant to any of the Assigned Contracts, or to make any payment or to make
any inquiry as to the nature or sufficiency of any payment received by it, or
to present or file any claim or to take any other action to collect or enforce
the payment of any amounts which may have been assigned to it or to which it
may be entitled hereunder at any time or times.
4. Modification of Assigned Contracts. Assignor agrees that so
long as this Assignment is in effect, it will not, without the prior written
consent of Assignee, which consent shall not be unreasonably withheld or
delayed, amend, modify or permit to be amended or modified any of the Assigned
Contracts or waive or permit to be waived any provisions of any of the Assigned
Contracts, or exercise any right to terminate or cancel any of the Assigned
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Contracts or consent or agree to, or suffer or permit, the termination thereof
(other than by expiration in accordance with its terms, without action by any
party thereto) whether or not on account of any default therein specified.
Notwithstanding anything to the contrary contained in this Section 4, the
consent of Assignee shall not be required for any such amendment, modification,
waiver, termination or cancellation with respect to any Significant Vendor
Contract provided that such amendment, modification, waiver, termination or
cancellation could not reasonably be expected to result in a Material Adverse
Effect. Assignor shall give Assignee prompt written notice of any amendment,
modification, waiver, termination or cancellation with respect to any Assigned
Contract.
5. Power of Attorney. Assignor does hereby appoint Assignee, its
successors and assigns, Assignor's true and lawful attorney, irrevocably, with
full power (in the name of Assignor or otherwise) at any time after an Event of
Default has occurred and is continuing, to ask, require, demand, receive,
compound and give acquittance for any and all monies and claims for monies due
and to become due under, or arising out of, each of the Assigned Contracts to
the extent that the same have been assigned by this Assignment, to endorse any
checks or other instruments or orders in connection therewith and to file any
claims or take any action or institute (or, if previously commenced, assume
control of) any proceedings and to obtain any recovery in connection therewith
which Assignee may deem to be necessary or advisable.
6. Further Assurances. Assignor agrees that at any time and from
time to time, upon the written request of Assignee, Assignor will promptly and
duly execute and deliver any and all such further instruments and documents as
Assignee may reasonably request in order to obtain the full benefits of this
Assignment and of the rights and powers herein granted.
7. Representations, Warranties and Covenants. Assignor hereby
represents, warrants and covenants (a) each of the Assigned Contracts is in
full force and effect and is enforceable in accordance with its respective
terms and that there is no default under any of the terms thereof; and (b)
Assignor has not assigned or pledged, and so long as this Assignment shall
remain in effect, Assignor will not assign or pledge, the whole or any part of
the rights hereby assigned to anyone other than Assignee, its successors or
assigns. Assignor further covenants that it will not take any action or fail
to take any action or institute any proceedings the taking or omission of which
might result in the material alteration or impairment of any of the Assigned
Contracts or this Assignment or any of the rights created by any of the
Assigned Contracts or this Assignment.
8. Notice of Default. Assignor shall promptly notify Assignee of,
and provide to Assignee copies of, any default notices given or received by
Assignor under any of the Assigned Contracts.
9. Financing Statements. Assignee is authorized at the expense of
Assignor to sign and file, at any time and from time to time, without the
signature of Assignor, any and all Uniform Commercial Code financing
statements, changes thereto or renewals thereof in connection with this
Assignment which Assignee may reasonably deem to be necessary or advisable in
order to perfect or maintain the security interest granted hereby. If Assignee
shall file any such financing statements, changes or renewals without the
signature of Assignor, Assignee shall provide Assignor with notice thereof as
soon as practicable after such filing.
10. Cumulative Remedies. Each and every right, power and remedy
herein given to the Assignee shall be cumulative and shall be in addition to
every other right, power and remedy of Assignee now or hereafter existing at
law, in equity or by statute, and each and every right, power and remedy,
whether herein given or otherwise existing, may be exercised from time to time,
in whole or in part, in accordance with the terms of this Assignment and as
often and in such order as may be deemed expedient by Assignee, and the
exercise or the beginning of the exercise of any right, power or remedy shall
not be construed to be a waiver of the right to exercise at the same time or
thereafter any other right, power or remedy. No delay or omission by Assignee
in the exercise of any right or power or in the pursuance of any remedy
accruing upon any breach or default by Assignor shall impair any such right,
power or remedy or be construed to be a waiver of any such right, power or
remedy or to be an acquiescence therein.
11. Severability; Impairment of Rights. Any provision of this
Assignment which is prohibited or unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
shall not invalidate or render unenforceable
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such provisions in any other jurisdiction. If for any other reason whatsoever,
the collateral assignment herein contained is either wholly or partly
defective, Assignor hereby undertakes to do all such other lawful acts as, in
the sole judgment of Assignee, shall be required in order to ensure and give
effect to the full intent of this Assignment.
12. Notices. All notices, demands and requests hereunder shall be
given in accordance with the provisions of the Credit Agreement.
13. Amendments; Waivers. None of the terms and conditions of this
Assignment may be changed, waived, modified or varied in any manner whatsoever
unless in writing duly signed by Assignor and Assignee.
14. Binding Effect. This Assignment shall be binding upon Assignor
and its successors and assigns and shall inure to the benefit of Assignee and
its successors and assigns, provided, however, that Assignor may not transfer
or assign any or all of its rights or obligations hereunder without the prior
written consent of Assignee. All agreements, statements and representations
made by Assignor herein or in any certificate or other instrument delivered by
Assignor or on its behalf under this Assignment shall be deemed to have been
relied upon by Assignee and shall survive the execution and delivery of this
Assignment, the Credit Agreement and the other Loan Documents.
15. Governing Law. This Assignment and the rights and obligations
of the parties hereunder shall be construed in accordance with and be governed
by the internal laws of the State of Illinois.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment to
be executed and delivered by their duly authorized officers as of the date
first above written.
CREDENTIALS SERVICES INTERNATIONAL, INC.
By: /s/ T.J. Maloney
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Name: T.J Maloney
Title: Chairman
LASALLE NATIONAL BANK
By: /s/ Andrew Kanfer
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Name: Andrew Kanfer
Title: Loan Officer
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CONSENT AND AGREEMENT
The undersigned, TRW Inc., an Ohio corporation, hereby acknowledges
notice of and consents to all of the terms of the foregoing Assignment of
Contracts ("Assignment") as such Assignment relates to the Acquisition
Agreement and the Servicing Agreement (as such terms are defined in the Credit
Agreement referred to in the foregoing Assignment).
TRW INC.
By:
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Name:
Title: