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EXHIBIT 4.3
AMENDED AND RESTATED
ASSIGNMENT AND SECURITY AGREEMENT
Dated as of September 13, 1994
Among
BROADWAY RECEIVABLES, INC.,
BLUE HAWK FUNDING CORPORATION,
BANKERS TRUST COMPANY,
as Trustee,
BANKERS TRUST COMPANY,
as Cash Collateral Bank,
and
GENERAL ELECTRIC CAPITAL CORPORATION
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TABLE OF CONTENTS
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SECTION 1. Grant of Security . . . . . . . . . . . . . . . . . . . . .. 3
SECTION 2. Security for Obligations . . . . . . . . . . . . . . . . .. 7
SECTION 3. Delivery of Collateral . . . . . . . . . . . . . . . . . .. 8
SECTION 4. Investing of Amounts in the
Cash Collateral Account and
the Reserve Account . . . . . . . . . . . . . . . . . . .. 8
SECTION 5. The Blocked Deposit Accounts . . . . . . . . . . . . . . .. 9
SECTION 6. Cash Collateral Account . . . . . . . . . . . . . . . . . .. 11
SECTION 7. Release of Amounts . . . . . . . . . . . . . . . . . . . .. 12
SECTION 8. Borrower Remains Liable . . . . . . . . . . . . . . . . . .. 17
SECTION 9. Representations and Warranties . . . . . . . . . . . . . .. 17
SECTION 10. Further Assurances; Supplements . . . . . . . . . . . . .. 19
SECTION 11. Additional Covenants . . . . . . . . . . . . . . . . . . .. 20
SECTION 12. Collateral Agent Appointed
Attorney-in-Fact . . . . . . . . . . . . . . . . . . . .. 25
SECTION 13. Collateral Agent May Perform . . . . . . . . . . . . . . .. 26
SECTION 14. The Collateral Agent . . . . . . . . . . . . . . . . . . .. 26
SECTION 15. Remedies Upon Default;
Application of Collateral . . . . . . . . . . . . . . .. 28
SECTION 16. Drawings Under the LOC . . . . . . . . . . . . . . . . . .. 33
SECTION 17. Amendments, Etc. . . . . . . . . . . . . . . . . . . . . .. 34
(i)
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SECTION 18. Indemnity and Expenses . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 19. Successor Collateral Agent . . . . . . . . . . . . . . . . . . . . . 35
SECTION 20. Addresses for Notices . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 21. No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . . 36
SECTION 22. Continuing Security Interest . . . . . . . . . . . . . . . . . . . . 37
SECTION 23. Further Indemnification . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 24. Governing Law; Terms . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 25. No Petition in Bankruptcy . . . . . . . . . . . . . . . . . . . . . 38
SECTION 26. Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 27. Jurisdiction; Consent to
Service of Process . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 28. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 29. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 30. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SCHEDULE I - Blocked Deposit Accounts
SCHEDULE II - Post Office Boxes
SCHEDULE III - Equipment Locations
SCHEDULE IV - Offices Where Related Contracts and Books,
Records, Etc. Evidencing Receivables Are
Kept
EXHIBIT A-1 Form of Blocked Deposit Agreement
(Deposit Accounts)
EXHIBIT A-2 Form of Blocked Deposit Agreement
(Concentration Account)
EXHIBIT B Form of Instruction to Post Office
EXHIBIT C Form of Blue Hawk Interest Rate Cap
Agreement
EXHIBIT D Form of Borrower Interest Rate
Cap Agreement
(ii)
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AMENDED AND RESTATED
ASSIGNMENT AND SECURITY AGREEMENT
AMENDED AND RESTATED ASSIGNMENT AND SECURITY AGREEMENT dated
as of September 13, 1994, among BROADWAY RECEIVABLES, INC. (formerly CHH
Receivables, Inc.), a Delaware corporation (the "Borrower"); BLUE HAWK FUNDING
CORPORATION, a Delaware corporation (the "Lender"); BANKERS TRUST COMPANY, a
New York banking corporation, as trustee under the below referenced Indenture
(in such capacity, the "Trustee"); BANKERS TRUST COMPANY, a New York banking
corporation, as cash collateral bank (in such capacity, the "Cash Collateral
Bank"); GENERAL ELECTRIC CAPITAL CORPORATION, a New York corporation, as agent
for the Lender under the below referenced Credit Agreement (in such capacity,
the "Agent"), as agent for the letter of credit providers (the "LOC Providers")
under the below referenced Reimbursement Agreement (in such capacity, the "LOC
Agent") and as agent for the below referenced Liquidity Lenders (the "Liquidity
Agent"); and GENERAL ELECTRIC CAPITAL CORPORATION, a New York corporation, as
collateral agent (in such capacity, the "Collateral Agent") for the benefit of
(a) itself as Agent, and Collateral Agent, (b) the Liquidity Agent on behalf of
the Liquidity Lenders, (c) the LOC Agent on behalf of the LOC Providers, (d)
the Lender, (e) the Trustee on behalf of the holders of the below referenced
Indenture Notes (the "Noteholders"), (f) BANKERS TRUST COMPANY, in its capacity
as depositary (the "Depositary") and (g) the holders of Commercial Paper (the
"CP Holders").
W I T N E S S E T H :
WHEREAS, the Lender and the Agent have entered into a
Receivables-Backed Credit Agreement dated as of October 8, 1992 (as such
agreement has been amended through the date hereof and may hereafter be amended
or otherwise modified from time to time, being the "Credit Agreement"; the
capitalized terms defined therein and not otherwise defined herein being used
herein shall have the meanings set forth therein) with the Borrower; and
WHEREAS, the Borrower has entered into a Letter of Credit
Reimbursement Agreement (as such agreement may hereafter be amended or
otherwise modified from time to
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time, being the "Reimbursement Agreement") with the LOC Agent, the LOC
Providers and the Lender; and
WHEREAS, the Lender has entered into a Liquidity Agreement
dated as of October 8, 1992 (as such agreement has been amended to the date
hereof and may hereafter be amended or otherwise modified from time to time,
being the "Liquidity Agreement") with a group of lenders (the "Liquidity
Lenders") on whose behalf the Liquidity Agent is acting; and
WHEREAS, the Lender has issued and intends to continue to
issue its Commercial Paper and has entered into a Depositary Agreement (as such
agreement may hereafter be amended or otherwise modified from time to time,
being the "Depositary Agreement") with the Depositary in connection therewith;
and
WHEREAS, the Borrower has entered into an Indenture dated as
of September 1, 1994 (as such agreement may hereafter be amended or otherwise
modified from time to time, being the "Indenture", the capitalized terms
defined therein and not otherwise defined herein or in the Credit Agreement
being used herein shall have the meanings set forth therein) with the Trustee
pursuant to which the Borrower intends to issue $38,000,000 aggregate principal
amount of 7.55% Subordinated Credit Card Notes, Class A, Due 1999 (the "Class A
Notes") and $26,000,000 aggregate principal amount of 11% Subordinated Credit
Card Notes, Class B, Due 1999 (the "Class B Notes," and, together with the
Class A Notes, the "Indenture Notes"); and
WHEREAS, it is a condition precedent to (a) the making of
Advances by the Lender under the Credit Agreement, (b) the issuance of the
letter of credit (the "LOC") by the LOC Providers under the Reimbursement
Agreement, (c) the execution and delivery by the Liquidity Lenders of the
Liquidity Agreement and (d) the issuance of the Indenture Notes, that the
Borrower and the Lender shall have executed and delivered this Agreement and
assigned and pledged the accounts receivable, agreements, bank accounts and
other rights and interests contemplated by this Agreement, and that the Cash
Collateral Bank, the Agent, the LOC Agent, the Collateral Agent, the Trustee
and the Liquidity Agent shall have executed and delivered this Agreement;
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NOW, THEREFORE, in consideration of the premises and in order
to induce (a) the Lender to make Advances under the Credit Agreement, (b) the
LOC Providers to issue the LOC, (c) the Liquidity Lenders to execute and
deliver the Liquidity Agreement and (d) the Trustee to authenticate and deliver
the Indenture Notes, the Borrower and the Lender hereby agree with the
Collateral Agent, the Agent, the Lender, the LOC Agent for its benefit and the
benefit of the LOC Providers, the Liquidity Agent for its benefit and the
benefit of the Liquidity Lenders, the Depositary for its benefit and the
benefit of the CP Holders and the Trustee for its benefit and the benefit of
the Indenture Noteholders (collectively, the "Secured Parties") as follows:
SECTION 1. Grant of Security. (a) The Borrower hereby
assigns and pledges to the Collateral Agent for its benefit and for the benefit
of the Lender, the LOC Agent, the LOC Providers, the Agent and the Trustee on
its behalf and on behalf of the Noteholders and the Note Owners (collectively,
the "Borrower Secured Parties") and grants to the Collateral Agent for its
benefit and for the benefit of the Borrower Secured Parties a security interest
in and lien upon, all of the Borrower's right, title and interest in and to the
following, in each case whether now or hereafter existing or in which Borrower
now has or hereafter acquires an interest and wherever the same may be located
(collectively, the "Borrower Collateral"):
(i) All accounts, contract rights, chattel paper,
instruments, general intangibles and other obligations of any kind,
now or hereafter existing (including, without limitation, all
Purchased Receivables), whether or not arising out of or in connection
with the sale or lease of goods or the rendering of services by any
Person, including the right to payment of any interest or finance
charges, attorneys' fees and other obligations with respect thereto,
and all rights in and to all security agreements, and other contracts
securing or otherwise relating to any such accounts, contract rights,
chattel paper, instruments, general intangibles or obligations
(collectively, the "Pledged Receivables," and any and all such
security agreements and other contracts being the "Related
Contracts");
(ii) All guarantees, insurance and other agreements or
arrangements of whatever character from
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time to time supporting or securing payment of any Purchased
Receivables;
(iii) All equipment in all of its forms, wherever located,
now or hereafter existing (including, but not limited to, all
software, data bases, materials, books, records, computer programs,
magnetic tapes, disks and cassettes relating to Receivables, and all
other equipment in which information concerning Receivables is stored
or which are necessary or helpful in the collection thereof), and all
parts thereof and accessions thereto (any and all such equipment,
parts and accessions being the "Equipment");
(iv) The Purchase Agreement, all Blocked Deposit
Agreements, all Post Office Boxes, all agreements now or hereafter in
effect relating to the servicing or processing of the Pledged
Receivables, the Subordinated Retailer Security Agreement, those
certain Interest Rate Cap Agreements between the Borrower and each of
Citicorp, N.A., Nationsbank, N.A. and Bank of America National Trust
and Savings Association, each substantially in the form of Exhibit D
hereto (collectively, the "Borrower Cap Agreement") and all other
Interest Rate Contracts to which the Borrower is a party, as the same
may be amended or otherwise modified from time to time (as so amended
or modified, the "Assigned Agreements"), including, without
limitation, (A) all rights of the Borrower to receive moneys due and
to become due under or pursuant to the Assigned Agreements, (B) all
rights of the Borrower to receive proceeds of any insurance,
indemnity, warranty or guaranty with respect to the Assigned
Agreements, (C) claims of the Borrower for damages arising out of or
for breach of or default under the Assigned Agreements and (D) the
right of the Borrower to amend, waive or terminate the Assigned
Agreements, to perform thereunder and to compel performance and
otherwise exercise all remedies thereunder (the Collateral described
in this paragraph (a)(iv) of Section 1 being sometimes described
herein as the "Assigned Collateral");
(v) All of the following (the "Account Collateral"):
(A) The Cash Collateral Account (as hereinafter
defined), all funds held therein, and all
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certificates and instruments, if any, from time to time representing
or evidencing the Cash Collateral Account;
(B) The Reserve Account (as defined in the
Reimbursement Agreement), all funds held therein, and all
certificates and instruments, if any, from time to time
representing or evidencing the Reserve Account;
(C) The Operating Account (as hereinafter
defined), all funds therein and all certificates and
instruments, if any, from time to time representing or
evidencing the Operating Account;
(D) All Blocked Deposit Accounts (as hereinafter
defined), all funds held therein, and all certificates and
instruments, if any, from time to time representing or
evidencing such funds or the Blocked Deposit Accounts;
(E) All Investments (as hereinafter defined) from
time to time and all certificates and instruments, if any,
from time to time representing or evidencing the Investments;
(F) All notes, certificates of deposit and other
instruments from time to time hereafter delivered to or
otherwise possessed by the Collateral Agent for and on behalf
of the Borrower in substitution for or in addition to any of
the then existing Account Collateral; and
(G) All interest, dividends, cash, instruments
and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any and
all of the then existing Account Collateral;
(vi) All proceeds (including, without limitation, In-Store
Payments), accessions, substitutions, rents and profits of any and all
of the foregoing Borrower Collateral (including, without limitation,
proceeds that constitute property of the types described in clauses
(i) through (v) above) and, to the extent not otherwise included, all
payments under insurance (whether or not the Collateral Agent is the
loss payee thereof), or any indemnity, warranty or guaranty, payable
by reason of loss or damage to or otherwise
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with respect to any of the foregoing Borrower Collateral. For
purposes of this Agreement, the term "proceeds" includes whatever is
receivable or received when Collateral or proceeds are sold,
collected, exchanged or otherwise disposed of, whether such
disposition is voluntary or involuntary, and includes, without
limitation, all rights to payment, including returned premiums, with
respect to any insurance relating thereto.
(b) The Lender hereby assigns and pledges to the
Collateral Agent for its benefit and for the benefit of the Liquidity Lenders,
the Liquidity Agent, the Cash Collateral Bank and the Depositary, on its behalf
and on behalf of the Holders (collectively, the "Lender Secured Parties") and
grants to the Collateral Agent for its benefit and for the benefit of the
Lender Secured Parties a security interest in all of the Lender's right, title
and interest in and to the following, whether now owned or hereafter acquired
(collectively, the "Lender Collateral"):
(i) the Borrower Collateral;
(ii) the Credit Agreement, the Note, the LOC, the
Reimbursement Agreement and the Liquidity Agreement, as the same may
be amended or otherwise modified from time to time (as so amended or
modified, the "Lender Assigned Agreements"), including, without
limitation, (A) all rights of the Lender to receive moneys due and to
become due under or pursuant to the Lender Assigned Agreements, (B)
all rights of the Lender to receive proceeds of any insurance,
indemnity, warranty or guaranty with respect to the Lender Assigned
Agreements, (C) claims of the Lender for damages arising out of or for
breach of or default under the Lender Assigned Agreements and (D) the
right of the Lender to amend, waive or terminate the Lender Assigned
Agreements, to perform thereunder and to compel performance and
otherwise exercise all remedies thereunder;
(iii) the Lender's Account and all funds held therein and
all certificates and instruments, if any, from time to time
representing or evidencing such funds or the Lender's Account;
(iv) the Interest Rate Cap Agreement, dated as of
October 8, 1992 between the Lender and General Electric Capital
Corporation, in the form of Exhibit C hereto (the "Blue Hawk Cap
Agreement"); and
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(v) all proceeds of any and all of the foregoing Lender
Collateral (including, without limitation, proceeds that constitute
property of the types described in clauses (i), (ii) and (iii) above),
and, to the extent not otherwise included, all payments under
insurance (whether or not the Collateral Agent is the loss payee
thereof), or any indemnity, warranty, or guaranty, payable by reason
of loss or damage to or otherwise with respect to any of the foregoing
Lender Collateral. For purposes hereof, the term "proceeds" includes
whatever is receivable or received when Collateral or proceeds are
sold, collected, exchanged or otherwise disposed of, whether such
disposition is voluntary or involuntary, and includes, without
limitation, all rights to payment, including returned premiums, with
respect to any insurance relating thereto.
(c) The Borrower Collateral pledged by the Borrower in
clause (a) above and the Lender Collateral pledged by the Lender in clause (b)
above shall collectively be referred to herein as the "Collateral."
SECTION 2. Security for Obligations. (a) This Agreement
secures and the Collateral is collateral security for the prompt payment or
performance in full when due, whether at stated maturity, by acceleration or
otherwise of all obligations of every nature of the Borrower or the Lender, as
the case may be, now or hereafter existing under the Credit Agreement, the
Reimbursement Agreement, the Indenture, the Indenture Notes, the Liquidity
Agreement, the Depositary Agreement, the Commercial Paper, and any promissory
note or other document or instrument delivered pursuant thereto and all
amendments, extensions or renewals thereof or hereof, whether for principal,
interest, fees, expenses or otherwise, whether now existing or hereafter
arising, voluntary or involuntary, whether or not jointly owed with others,
direct or indirect, absolute or contingent, liquidated or unliquidated, and
whether or not from time to time decreased or extinguished and later increased,
created or incurred and all or any portion of such obligations that are paid,
to the extent all or any part of such payment is avoided or recovered directly
or indirectly from any Borrower Secured Party or Lender Secured Party, as the
case may be, as a preference, fraudulent transfer or otherwise, and all
obligations of every nature of the Borrower or the Lender, as the case may be,
now or hereafter existing under this Agreement (all such obligations being the
"Secured Obligations").
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(b) The grant by the Borrower to the Collateral Agent
pursuant to Section 1(a) above and the grant by the Lender to the Collateral
Agent pursuant to Section 1(b) above are not for the equal and ratable benefit
of the Borrower Secured Parties and the Lender Secured Parties, respectively.
The relative rights, benefits and priorities of each of the Borrower Secured
Parties and each of the Lender Secured Parties are as specifically set forth in
the provisions of this Agreement, including but not limited to Sections 7 and
15 hereof.
SECTION 3. Delivery of Collateral. All certificates or
instruments, if any, representing or evidencing the Collateral shall be
delivered to and held by or on behalf of the Collateral Agent pursuant hereto
and shall be in suitable form for transfer by delivery, or shall be accompanied
by duly executed instruments of transfer or assignment in blank, all in form
and substance satisfactory to the Collateral Agent. The Collateral Agent shall
have the right, at any time in its discretion and without notice to the
Borrower or the Lender, to transfer to or to register in the name of the
Collateral Agent or any of its nominees any or all of the Collateral. In
addition, the Collateral Agent shall have the right at any time to exchange
certificates or instruments representing or evidencing Collateral for
certificates or instruments of smaller or larger denominations.
SECTION 4. Investing of Amounts in the Cash Collateral
Account and the Reserve Account. (a) The Cash Collateral Bank shall, subject
to the provisions of Section 6, Section 7 and Section 15, from time to time for
the account and at the risk of the Borrower, upon the instructions of the
Collateral Agent (which instructions may be general or specific and may be
given in writing or by telephone confirmed promptly thereafter in writing) (i)
invest amounts on deposit in the Cash Collateral Account in Cash Equivalents
and (ii) invest and reinvest interest on and proceeds of such investments in
Cash Equivalents (the investments referred to in clauses (i) and (ii) above
being collectively "Investments"). Interest and proceeds which are not
invested or reinvested in Investments as provided above shall be deposited and
held in the Cash Collateral Account.
(b) The Cash Collateral Bank shall, from time to time,
upon the instructions of the Collateral Agent (which instructions may be
general or specific and may be given in writing or by telephone confirmed
promptly thereafter in
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writing), (i) invest amounts on deposit in the Reserve Account in Cash
Equivalents and (ii) release all interest on and proceeds of such investments
to the Operating Account on the fifth Business Day following the end of each
calendar month unless an Event of Default or an L/C Event of Default (as
defined in the Reimbursement Agreement) has occurred and is continuing. If an
Event of Default or an L/C Event of Default has occurred and is continuing,
such interest shall be released to the LOC Agent on the fifth Business Day
following the end of each calendar month for application by the LOC Agent to
any amounts then due and owing by the Borrower under the Reimbursement
Agreement. All amounts remaining on deposit in the Reserve Account shall be
released to the LOC Agent at the earlier of (A) the Business Day following the
day the Agent notifies the Collateral Agent that the Principal of and Interest
on all Advances have been paid in full, the Commitment has been irrevocably
terminated and all Required Payments payable or to be payable by the Borrower
under any Facility Documents have been paid in full and (B) the Business Day
following the Liquidity Termination Date or such later date on which all
Commercial Paper and all amounts due and owing to the Liquidity Lenders under
the Liquidity Agreement and the Loan Notes shall have been paid in full.
(c) The Cash Collateral Bank shall be entitled to rely
on any instructions given by the Collateral Agent in accordance with
paragraphs (a) and (b) of this Section 4 or otherwise in accordance with the
terms of this Agreement. Funds received in the Cash Collateral Account or the
Reserve Account after 2:00 P.M. (New York City time) on any Business Day are
not required to be invested by the Cash Collateral Bank until the following
Business Day.
SECTION 5. The Blocked Deposit Accounts. (a) The Borrower
has established with certain banks (the "Blocked Deposit Banks") certain
lockboxes and certain blocked deposit accounts (including, without limitation,
blocked deposit accounts into which the Servicer deposits from time to time
monies, instruments and other property received by it directly or through the
Post Office Boxes listed on Schedule II) into which monies, instruments and
other property are deposited from time to time (all such lockboxes and blocked
deposit accounts and any replacements thereof and all monies, instruments and
other property deposited therein being collectively the "Blocked Deposit
Accounts") for the deposit of cash and other proceeds of Collateral. The
Borrower hereby transfers to the Collateral Agent the exclusive dominion and
control of the
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Blocked Deposit Accounts and all monies, instruments and other property from
time to time therein. The Borrower will not make or cause to be made, or have
any ability to make or cause, any withdrawals from the Blocked Deposit
Accounts, except as provided in Section 6(b).
(b) The Borrower hereby (i) represents and warrants that
it has no bank or deposit accounts of any kind other than the Operating Account
and the Blocked Deposit Accounts listed on Schedule I and (ii) agrees and
covenants that (A) it has delivered to the Collateral Agent fully executed
Blocked Deposit Agreements substantially in the form of Exhibit A-1 or Exhibit
A-2 hereto, from each and every Blocked Deposit Bank, and (B) all cash and
other proceeds of Collateral shall be deposited either in a Blocked Deposit
Account or in the Cash Collateral Account. The Borrower further agrees and
covenants to maintain each of the Blocked Deposit Accounts in accordance with
the related Blocked Deposit Agreement.
(c) The Borrower or the Servicer has instructed all
Obligors to make payments in respect of Purchased Receivables only (i) by check
or money order mailed to one or more post office boxes under the control of
employees of the Borrower or the Servicer (each such box being a "Post Office
Box"), (ii) by cash, check or money order at Broadway stores ("In-Store
Payments") or (iii) in the case of certain delinquent accounts, by wire or
moneygram directly to a service center of the Servicer ("Wire Payments"). The
Borrower hereby represents and warrants that all of the Post Office Boxes to
which mail payments are made as of the date hereof are listed on Schedule II.
The Borrower further agrees (A) to deliver to the Collateral Agent on the
Closing Date an executed instruction letter to the United States Postal Service
with respect to each Post Office Box listed on Schedule II, such standing
instruction letter to be in substantially the form of Exhibit B hereto; and (B)
to use its best efforts, in accordance with its current practice, to cause all
cash and other proceeds of Collateral received in any such Post Office Box, all
In-Store Payments and all Wire Payments to be deposited, in the same form so
received (with all necessary endorsements), on the Business Day on which such
cash, other proceeds, In-Store Payments and Wire Payments are received, and
agrees that in any event all such cash, other proceeds, In-Store Payments and
Wire Payments shall be deposited in the form so received (with all necessary
endorsements) not later than the close of business on the Business Day
following the date of such receipt, either in a Blocked
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Deposit Account or in the Cash Collateral Account and until so deposited shall
be held in trust for the Collateral Agent. The Borrower shall not establish
any Post Office Box not listed on Schedule II hereto unless it shall have (i)
obtained the written consent of the Collateral Agent, (ii) delivered to the
Collateral Agent an executed instruction letter with respect to such Post
Office Box in substantially the form of Exhibit B hereto and (iii) pledged such
Post Office Box to the Collateral Agent hereunder. The Borrower may not close
any Post Office Box during the term of this Agreement.
(d) In the event any Blocked Deposit Bank shall, after
the date hereof, terminate an agreement with respect to the maintenance of a
Blocked Deposit Account for any reason, or if the Collateral Agent shall demand
such termination after the occurrence of an Event of Default, the Borrower
agrees to promptly notify all Persons that were making payments to such
terminated Blocked Deposit Account to make all future payments to another
Blocked Deposit Bank with which the Borrower has an agreement with respect to
the maintenance of a Blocked Deposit Account that has not been terminated. The
Borrower shall not close any Blocked Deposit Account or establish a new Blocked
Deposit Account unless it shall have (i) notified the Collateral Agent thereof
in writing at least 30 days prior thereto or otherwise obtained the consent of
the Collateral Agent, and (ii) in the case of a new Blocked Deposit Account,
entered into a Blocked Deposit Agreement substantially in the form of Exhibit
A-1 or Exhibit A-2 hereto, the material terms of which are reasonably
satisfactory to the Collateral Agent, each with a Blocked Deposit Bank, and
pledged such Blocked Deposit Account to the Collateral Agent hereunder.
SECTION 6. Cash Collateral Account. (a) The Borrower has
established with the Corporate Trust Department of Bankers Trust Company, as
Cash Collateral Bank, at its office at Four Albany Street, New York, New York
10006, in the name of the Collateral Agent on behalf of the Secured Parties, a
deposit account (the "Cash Collateral Account"). The Cash Collateral Account
shall be subject to the exclusive dominion and control of the Collateral Agent.
By its execution of this Agreement, Bankers Trust Company acknowledges and
agrees to undertake its responsibilities as Cash Collateral Bank in accordance
with the terms hereof. The Cash Collateral Bank may resign 30 days following
delivery of notice of such resignation to the Collateral Agent, such
resignation to be effective only upon establishment of a new cash collateral
account at a depositary
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institution by the Collateral Agent and execution of a writing by such
depositary institution by which it agrees to act as Cash Collateral Bank
hereunder.
(b) The Borrower shall instruct each Blocked Deposit Bank
to transfer, and, if the Borrower fails to so instruct each Blocked Deposit
Bank, the Borrower hereby grants the Collateral Agent the authority to instruct
each Blocked Deposit Bank to transfer, on each Business Day, in same day funds,
all available funds on deposit in the Blocked Deposit Accounts in such Blocked
Deposit Bank on such day to the Cash Collateral Account or to the single
Blocked Deposit Account that is subject to a Blocked Deposit Agreement in the
form of Exhibit A-2 hereto (the "Concentration Account"). All available funds
on deposit in the Concentration Account on each Business Day shall be
transferred by the close of business on such Business Day to the Cash
Collateral Account as provided in the Blocked Deposit Agreement with respect to
the Concentration Account.
(c) The Borrower shall instruct each counterparty to a
Borrower Cap Agreement to make payment of, and, if the Borrower fails to so
instruct each counterparty, the Borrower hereby grants the Collateral Agent the
authority to instruct each counterparty to make payment of, all amounts payable
by such counterparty thereunder directly to the Cash Collateral Account.
(d) The Borrower may maintain the Operating Account as
its operating and/or payroll account, provided that the Borrower shall, in
addition to the deposits and transfers set forth above, deposit in the Cash
Collateral Account, at the end of each day, all cash and Cash Equivalents of
the Borrower in excess of $100,000 in the aggregate on deposit in the Operating
Account, to be held by the Cash Collateral Bank on behalf of the Collateral
Agent as collateral for the Secured Obligations in accordance with the terms of
this Agreement.
(e) The Borrower agrees that it shall not make or
maintain any deposits in any deposit account with any financial institution
other than as provided herein.
SECTION 7. Release of Amounts. (a) Prior to the Commitment
Termination Date, so long as (x) no Event of Default shall have occurred and be
continuing or would result from the application of funds in accordance with
this Section 7(a) and (y) no Early Amortization Event (as
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hereinafter defined) shall have occurred or would result from the application
of funds in accordance with this Section 7(a), on each Business Day the
Collateral Agent shall instruct the Cash Collateral Bank (which instruction may
be in writing or by telephone confirmed promptly thereafter in writing) to (1)
release funds on deposit in the Cash Collateral Account in the following order
of priority (i) to make payment of any amount required to be paid on such
Business Day to the Collateral Agent pursuant to Section 18(b) hereof, (ii) to
make payment of any amounts required to be paid on such Business Day to the
Servicer pursuant to Section 6.2 of the Purchase Agreement, (iii) to make
payment of any amounts required to be paid on such Business Day to the Lender
pursuant to Sections 2.04(b), 2.05 or 2.07(b) of the Credit Agreement (all such
payments specified in clauses (ii) and (iii), the "Required Payments"), (iv) to
make payment of any amounts required to be paid on such Business Day to the
Lender pursuant to Section 2.04(c) of the Credit Agreement, (v) to make payment
of any amounts required to be paid to the Lender on October 8, 1996 (or such
later date as the Commitment Termination Date may be extended to in accordance
with Section 2.15 of the Credit Agreement) pursuant to Section 2.06 of the
Credit Agreement, (vi) to make payment to the Trustee of any interest due and
owing on such Business Day in respect of the Class A Notes, (vii) to make
payment to the Trustee of any interest due and owing on such Business Day in
respect of the Class B Notes, and (viii) to make payment of any other amount
required to be paid on such Business Day under the Credit Agreement (including,
without limitation, Section 2.06 thereof), the Liquidity Agreement, the
Reimbursement Agreement (including, without limitation, pursuant to Section
2.03 thereof), the Depositary Agreement or this Agreement (including, without
limitation, Section 18(a) hereof) and (2) after making the Required Payments
and such other payments on such Business Day, release from the Cash Collateral
Account to the Borrower pursuant to the same instructions (i) any amounts that
are in excess of the Required Payments and such other payments for such
Business Day (which amounts shall be used by the Borrower solely for the
purposes permitted under the Credit Agreement) and (ii) any income generated
from the investment of amounts on deposit in the Cash Collateral Account. For
the purposes of this Agreement, "Early Amortization Event" shall mean any of
the following events:
(A) any "event of default" under (and as defined in) the
Indenture shall occur;
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(B) the failure of the Borrower to redeem all of the
Indenture Notes on or prior to October 8, 1996;
(C) failure on the part of the Servicer to timely make any
payment or deposit of collections in respect of the Purchased
Receivables required under this Agreement or the Purchase Agreement
which failure continues unremedied for a period of five Business Days;
(D) failure on the part of the Borrower or the Servicer to
make any payment or deposit required pursuant to the Indenture, this
Agreement or the Purchase Agreement (other than a failure by the
Borrower to pay principal or interest in respect of the Indenture
Notes or any failure by the Servicer specified in (C) above) which
failure continues unremedied for a period of five business days after
written notice thereof shall have been delivered to the Borrower;
(E) failure on the part of the Borrower or the Servicer to
observe or perform in any material respect any covenants or agreements
set forth in the Indenture, this Agreement or the Purchase Agreement
(other than a failure by the Borrower to pay principal or interest in
respect of the Indenture Notes or any failure by the Borrower or the
Servicer specified in (C) or (D) above) which failure continues
unremedied for a period of 30 days after written notice thereof shall
have been delivered to the Borrower;
(F) any representation or warranty made by the Borrower, the
Servicer or Broadway contained in the Indenture, this Agreement or the
Purchase Agreement proves to have been incorrect in any material
respect when made and which continues to be incorrect in any material
respect for a period of 30 days after written notice thereof shall
have been delivered to the Borrower; provided that a repurchase of a
Purchased Receivable about which there has been a breach of a
representation or warranty pursuant to Section 2.4(a) of the Purchase
Agreement shall constitute a cure of such breach;
(G) the Borrower or Broadway shall generally not pay its
debts as such debts become due, or shall admit in writing its
inability to pay its debts generally, or shall make a general
assignment for the benefit of
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creditors; or any proceeding shall be instituted by or against the
Borrower or Broadway seeking to adjudicate it a bankrupt or insolvent,
or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee, custodian or other similar
official for it or for any substantial part of its property and, in
the case of any such proceeding instituted against it (but not
instituted by it), either such proceeding shall remain undismissed or
unstayed for a period of 30 days, or any of the actions sought in such
proceeding (including, without limitation, the entry of an order for
relief against, or the appointment of a receiver, trustee, custodian
or other similar official for, it or for any substantial part of its
property) shall occur; or the Borrower or Broadway shall take any
corporate action to authorize any of the actions set forth above in
this subsection (G); or
(H) the Borrower becomes subject to regulation as an
"investment company" within the meaning of the Investment Company Act
of 1940, as amended; or
(I) Broadway shall fail to convey Receivables as required
pursuant to Section 2.1 of the Purchase Agreement for a period in
excess of five Business Days; or
(J) the sum of the aggregate outstanding principal amount of
the Indenture Notes and the aggregate outstanding principal amount of
the Advances shall exceed the Maximum Permitted Debt for two
consecutive Business Days; or
(K) the sum of the aggregate outstanding principal amount of
the Class A Notes and the outstanding principal amount of the Advances
shall exceed the Maximum Class A Debt Amount for two consecutive
Business Days; or
(L) the outstanding principal amount of the Advances shall
exceed 82% of the Outstanding Balance of the Eligible Receivables for
two consecutive Business Days; or
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(M) the average Payment Rate for any three consecutive
Settlement Periods shall be less than 11%; or
(N) the average Write-Off Rate for any three consecutive
Settlement Periods shall exceed 11%; or
(O) the Indenture, this Agreement or the Purchase Agreement
shall fail to be a valid and enforceable obligation of the Borrower
and such failure shall have a material adverse effect on the rights or
interests of the holders of the Indenture Notes; or
(P) a Purchase Termination Event shall have occurred and be
continuing under the Purchase Agreement; or
(Q) any unpaid judgment or order for the payment of money in
excess of $50,000 (after deducting the portion of any such judgment
which is fully covered by insurance issued by a reputable insurer)
shall be rendered against the Borrower and either (i) enforcement
proceedings shall have been commenced and shall be continuing by any
Person upon such judgment or order or (ii) there shall be any period
of 20 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall
not be in effect;
provided, however, that none of the events specified in clauses (D), (E), (F),
(O) and (Q) will constitute an Early Amortization Event unless and until the
holders of not less than 66-2/3% in principal amount of the outstanding
Indenture Notes vote to declare an Early Amortization Event based thereon. The
Collateral Agent may conclusively rely upon a written notification from the
Trustee with respect to (i) the occurrence of any event constituting an Early
Amortization Event and (ii) any vote of the holders of the Indenture Notes with
respect to an event specified in clauses (D), (E), (F), (O) or (Q) above.
For purposes of this Section 7(a), the following terms shall
have the following meanings:
"Maximum Class A Debt Amount" means, as of any day, an amount
equal to the product of (x) the Maximum Class A Debt Ratio and (y) the
Outstanding Balance of the Eligible Receivables on such day.
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"Maximum Permitted Debt" means, as of any day, an amount equal
to the product of (x) the Maximum Permitted Debt Ratio multiplied by
(y) the Outstanding Balance of the Eligible Receivables on such day.
"Write-Off Rate" shall mean, for any Settlement Period, a
fraction (a) the numerator of which is an amount equal to the product
of (x) 12, multiplied by (y) the Normalized Net Write-Offs for such
Settlement Period and (b) the denominator of which is the aggregate
Outstanding Balance of the Purchased Receivables on the first day of
such Settlement Period.
(b) Commencing on the Commitment Termination Date and during
any period while (x) an Event of Default has occurred and is continuing or
would result from the application of funds on any Business Day in accordance
with Section 7(a), or (y) an Early Amortization Event has occurred or would
result from the application of funds on any Business Day in accordance with
Section 7(a), the Collateral Agent shall instruct the Cash Collateral Bank to
apply all amounts when received in the Cash Collateral Account to pay the
Secured Obligations in accordance with the order of priority set forth in
Section 15(b) hereof.
SECTION 8. Borrower Remains Liable. Anything herein to the
contrary notwithstanding, (a) the Borrower shall remain liable under the
contracts and agreements included in the Collateral to the extent set forth
therein to perform all of its duties and obligations thereunder to the same
extent as if this Agreement had not been executed, (b) the exercise by the
Collateral Agent of any of the rights hereunder shall not release the Borrower
from any of its duties or obligations under the contracts and agreements
included in the Collateral, and (c) neither the Collateral Agent nor any of the
Secured Parties shall have any obligation or liability under the contracts and
agreements included in the Collateral by reason of this Agreement, nor shall
the Collateral Agent or any of the Secured Parties be obligated to perform any
of the obligations or duties of the Borrower thereunder or to take any action
to collect or enforce any claim for payment assigned hereunder.
SECTION 9. Representations and Warranties. The Borrower
hereby represents and warrants as follows:
(a) The chief place of business and chief executive
office of the Borrower are located and have been
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located for the four months prior to the date hereof at 1600 North
Kraemer Boulevard, Anaheim, California 92806. The offices where the
Borrower keeps its records concerning the Pledged Receivables and the
original copies of the Assigned Collateral are located and have been
located for the four months prior to the date hereof at the places
listed on Schedule IV. Schedule III contains a complete and accurate
list of the locations, by state, county and street address, of all the
Equipment of the Borrower. The original copies of Related Contracts
are located at the offices of the Servicer listed on Schedule IV.
(b) The Borrower is the legal and beneficial owner of the
Borrower Collateral free and clear of any liens, security interest,
option or other charge or encumbrance except for the security interest
created by this Agreement. No effective financing statement or other
instrument similar in effect covering all or any part of the Borrower
Collateral is on file in any recording office, except such as may have
been filed (i) in favor of the Collateral Agent relating to this
Agreement or (ii) with respect to the Receivables, in favor of the
Borrower relating to the Purchase Agreement. The Borrower has no
trade names and does not do business under any fictitious business
name.
(c) The pledge and assignment of the Borrower Collateral
pursuant to this Agreement creates a valid and perfected first
priority security interest in the Borrower Collateral, and all filings
and other actions necessary or desirable to perfect and protect such
security interest have been duly taken.
(d) No authorization, consent, approval or other action
by, and no notice to or filing with, any governmental authority or
regulatory body is required (i) for the grant by the Borrower of the
assignment or security interest granted hereby or for the execution,
delivery or performance of this Agreement by the Borrower, (ii) for
the perfection of or the exercise by the Collateral Agent of its
rights and remedies provided for in this Agreement or (iii) to ensure
the legality, validity, enforceability or admissibility in evidence of
this Agreement in any jurisdiction in which any of the Collateral is
located.
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(e) None of the Account Collateral or Pledged Receivables
is evidenced by a promissory note or other instrument or constitutes
chattel paper.
(f) The Borrower has exclusive possession and control of
the Equipment, subject to the rights of any owners or lessors of
Equipment that is leased by the Borrower, and exclusive control of
each Blocked Deposit Account.
(g) Each of the Assigned Agreements to which Broadway, the
Servicer or the Borrower is a party constitutes the legal, valid and
binding obligation of such Person, enforceable against such Person, in
accordance with its terms. Each Pledged Receivable constitutes the
legally valid and binding obligation of the party obligated to pay the
same.
SECTION 10. Further Assurances; Supplements. (a) Each of
the Borrower and the Lender severally agrees that at any time and from time to
time, at the expense of the Borrower, each of the Borrower and the Lender will
promptly execute and deliver all further instruments and documents, and take
all further action that may be necessary or desirable, or that the Collateral
Agent may request, to perfect and protect the assignments and security
interests granted or purported to be granted hereby or to enable the Collateral
Agent to exercise and enforce its rights and remedies hereunder with respect to
any Collateral. Without limiting the generality of the foregoing, each of the
Borrower and the Lender will (i) if any Collateral shall be evidenced by a
promissory note or other instrument, or if any of the Collateral shall
constitute chattel paper, deliver and pledge to the Collateral Agent such note,
instrument and all original counterparts of chattel paper duly endorsed and
accompanied by duly executed instruments of transfer or assignment, all in form
satisfactory to the Collateral Agent and (ii) execute and file such financing
or continuation statements, or amendments thereto, and such other instruments
or notices, as may be necessary or desirable, or that the Collateral Agent may
request, to protect and preserve the assignments and security interests granted
or purported to be granted hereby.
(b) The Borrower and the Lender hereby severally
authorize the Collateral Agent to file one or more financing or continuation
statements, and amendments thereto, relative to all or any part of the
Collateral without the
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signature of the Borrower or the Lender where permitted by law. A carbon,
photographic or other reproduction of this Agreement or any financing statement
covering the Collateral or any part thereof shall be sufficient as a financing
statement where permitted by law. The Collateral Agent will promptly send the
Borrower any financing or continuation statements thereto which it files
without the signature of the Borrower and will promptly send the Lender any
financing or continuation statements thereto which it files without the
signature of the Lender except, in the case of filings of copies of this
Agreement as financing statements, the Collateral Agent will promptly send the
Borrower or the Lender, as the case may be, the filing or recordation
information with respect thereto.
(c) Each of the Borrower and the Lender will furnish to
the Collateral Agent from time to time statements and schedules further
identifying and describing the Collateral and such other reports in connection
with the Collateral as the Collateral Agent may reasonably request, all in
reasonable detail.
(d) Each of the Borrower and the Lender severally agrees
that it will not (i) except as permitted or required pursuant to the Purchase
Agreement and the Indenture, sell, assign (by operation of law or otherwise) or
otherwise dispose of, or grant any option with respect to, any of the
Collateral or (ii) create or permit to exist any lien, security interest or
other charge or encumbrance upon or with respect to any of the Collateral,
except for Permitted Liens and the security interests under this Agreement.
SECTION 11. Additional Covenants. (a) The Borrower shall
keep its chief place of business and chief executive offices and the office
where it keeps its respective records concerning the Collateral at the location
therefor specified in Section 9(a) or, upon 30 days' prior written notice to
the Collateral Agent, at such other location in a jurisdiction where all action
required by Section 10 shall have been taken with respect to the Collateral.
The Borrower shall, for not less than three years or for such longer period as
may be required by law, from the date on which such Pledged Receivable arose,
maintain (i) complete records of each Pledged Receivable, including records of
all payments received, credits granted and merchandise returned and (ii) all
documentation relating thereto. The Borrower will permit representatives of
the Collateral Agent at any time and from time to time
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during normal business hours, and at such times outside of normal business
hours as the Collateral Agent shall reasonably request, to inspect and make
copies of and abstracts from such records and visit the properties of the
Borrower or the Servicer utilized in connection with the collection, processing
or servicing of the Pledged Receivables. In connection therewith, the
Collateral Agent may institute procedures to permit it to confirm the obligor
balances in respect of any Pledged Receivables. The Borrower agrees to render
to Collateral Agent such clerical and other assistance as may be reasonably
requested with regard to the foregoing. If an Event of Default shall have
occurred and be continuing, promptly upon request therefor, the Borrower shall
deliver to the Collateral Agent (i) complete and correct copies of each Related
Contract and (ii) a File Tape reflecting activity through the close of business
on the immediately preceding Business Day.
(b) The Borrower shall duly fulfill in all material respects
all obligations on its part to be fulfilled under or in connection with the
Pledged Receivables and the Related Contracts and shall do nothing to impair
the rights of the Collateral Agent therein.
(c) Except as otherwise provided in this subsection (c),
and subject to the provisions of Sections 5 and 6 hereof, the Borrower shall
continue to collect or cause to be collected, at its own expense, all amounts
due or to become due to the Borrower under the Pledged Receivables, the
Assigned Agreements and any other Borrower Collateral. In connection with such
collections, the Borrower may take (and at the Collateral Agent's direction
after an Event of Default has occurred and is continuing, shall take) such
action as the Borrower or the Collateral Agent may deem necessary or advisable
to enforce collection of the Pledged Receivables and the Assigned Agreements;
provided, however, that the Collateral Agent may, at any time an Event of
Default has occurred and is continuing, notify Obligors with respect to any
Pledged Receivables or obligors under the Assigned Agreements of the assignment
of such Pledged Receivables or Assigned Agreements, as the case may be, to the
Collateral Agent and to direct that payments of all amounts due or to become
due to the Borrower thereunder be made directly to the Collateral Agent or any
servicer, collection agent or lockbox or other account designated by the
Collateral Agent and, upon such notification, and at the expense of the
Borrower, the Collateral Agent may enforce collection of any such Pledged
Receivables or the
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Assigned Agreements and adjust, settle or compromise the amount or payment
thereof.
(d) Any proceeds of Collateral, including In-Store
Payments and checks or money orders received in a Post Office Box, when first
received by or on behalf of the Borrower shall be deposited by or on behalf of
the Borrower in the form so received in a Blocked Deposit Account or the Cash
Collateral Account, and until so deposited shall be held in trust for and as
the Collateral Agent's property and shall not be commingled with the Borrower's
or any other Person's other funds or properties.
(e) Neither the Lender nor the Borrower will, without the
Collateral Agent's prior written consent, grant any extension of the time of
payment of any of the Collateral, compromise, compound or settle the same for
less than the full amount thereof or release, wholly or partly, any Person
liable for the payment thereof, except in accordance with the applicable Credit
and Collection Policy.
(f) The Borrower will, at its own cost and expense,
maintain satisfactory and complete records of the Collateral, including,
without limitation, a record of all payments received and all credits granted
with respect to the Collateral and all other dealings with the Collateral.
Each of the Borrower and the Servicer will mark conspicuously with a legend, in
form and substance satisfactory to the Collateral Agent, (A) its books,
records, computer tapes or disks, and credit files pertaining to the Collateral
and the Related Contracts and (B) its file cabinets or other storage facilities
where it maintains information pertaining to the Collateral and the Related
Contracts, to evidence this Agreement and the assignment and security interest
granted hereby. Upon the occurrence and during the continuation of an Event of
Default, the Borrower will (i) deliver and turn over to the Collateral Agent or
to its representatives, or at the option of the Collateral Agent shall provide
the Collateral Agent or its representatives with access to, at any time on
demand of the Collateral Agent, all the Borrower's books and records pertaining
to the Collateral and the Related Contracts including, without limitation, all
original sales slips, invoices, credit files and computer software, programs,
tapes or disks (including but not limited to all File Tapes) relating to
Receivables or otherwise necessary to the servicing thereof and/or (ii) allow
the Collateral Agent to occupy the premises of the Borrower and/or the Servicer
where such
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books, records, Related Contracts, credit files, computer tapes and File Tapes
are maintained and utilize such premises, the equipment thereon and any
personnel of the Borrower or the Servicer that the Collateral Agent may wish to
employ, to administer, service and collect the Pledged Receivables. The amount
represented by the Borrower to the Collateral Agent from time to time as owing
by Obligors in respect of the Pledged Receivables will at such time be, in all
material respects, the correct amount actually and unconditionally owing by
such Obligors thereunder.
(g) Each of the Lender, the Borrower and the Servicer
will comply in all material respects with all applicable statutes, rules, and
regulations with respect to the Collateral or any part thereof.
(h) The Borrower will pay promptly when due all taxes,
assessments and governmental charges or levies imposed upon the Collateral or
in respect of its income or profits therefrom and all claims of any kind
(including, without limitation, claims for labor, materials and supplies),
except that no such amount need be paid if (i) such non-payment does not
involve any danger of the sale, forfeiture or loss of any of the Collateral or
any interest therein, (ii) the charge or levy is being contested in good faith
and by proper proceedings, and (iii) the obligation to pay such amount is
adequately reserved against in accordance with and to the extent required by
U.S. GAAP.
(i) The Borrower will (i) perform and observe all the
terms and provisions of the Assigned Agreements to be performed or observed by
it, maintain the Assigned Agreements in full force and effect, enforce the
Assigned Agreements in accordance with their terms and take all such action to
such end as may be from time to time requested by the Collateral Agent, and
(ii) furnish to the Collateral Agent promptly upon receipt thereof copies of
all notices, requests and other documents received by the Borrower under or
pursuant to the Assigned Agreements, and from time to time (A) furnish to the
Collateral Agent such information and reports regarding the Assigned Collateral
as the Collateral Agent may reasonably request and (B) upon request of the
Collateral Agent, make to any counterparty to the Assigned Agreements such
demands and requests for information and reports or for action as the Borrower
is entitled to make under the Assigned Agreements.
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(j) Without the prior written approval of the Collateral
Agent, the Borrower will not (i) cancel or terminate any of the Assigned
Agreements or consent to or accept any cancellation or termination thereof,
(ii) amend or otherwise modify any of the Assigned Agreements or give any
material consent, waiver or approval thereunder, (iii) waive any default under
or breach of any of the Assigned Agreements or (iv) take any other action not
required by the terms of any of the Assigned Agreements that would affect the
value of the interest or rights of the Borrower thereunder or that would affect
the interests or rights of the Collateral Agent.
(k) The Lender will (i) perform and observe all the terms
and provisions of the Lender Assigned Agreements to be performed or observed by
it, maintain the Lender Assigned Agreements in full force and effect, enforce
the Lender Assigned Agreements in accordance with their terms and take all such
action to such end as may be from time to time requested by the Collateral
Agent, and (ii) furnish to the Collateral Agent promptly upon receipt thereof
copies of all notices, requests and other documents received by the Lender
under or pursuant to the Lender Assigned Agreements, and from time to time (A)
furnish to the Collateral Agent such information and reports regarding the
Lender Assigned Agreements as the Collateral Agent may reasonably request and
(B) upon request of the Collateral Agent, make to any counterparty to the
Lender Assigned Agreements such demands and requests for information and
reports or for action as the Lender is entitled to make under the Lender
Assigned Agreements.
(l) Without the prior written approval of the Collateral
Agent, the Lender will not (i) cancel or terminate any of the Lender Assigned
Agreements or consent to or accept any cancellation or termination thereof,
(ii) amend or otherwise modify any of the Lender Assigned Agreements or give
any material consent, waiver or approval thereunder, (iii) waive any default
under or breach of any of the Lender Assigned Agreements or (iv) take any other
action not required by the terms of any of the Lender Assigned Agreements that
would impair the value of the interest or rights of the Lender thereunder or
that would impair the interest of rights of the Collateral Agent.
(m) Each of the Lender and the Borrower will advise the
Collateral Agent promptly, in reasonable detail, (i) of any lien, security
interest, encumbrance or claim made or asserted against any of the Collateral
and (ii) of
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the occurrence of any event which would have a material adverse effect on the
aggregate value of the Collateral or on the assignments and security interests
granted hereby.
(n) Neither the Borrower nor the Lender will sell, assign (by
operation of law or otherwise), or otherwise dispose of, or grant any option
with respect to, any of the Collateral, except for sales of Equipment or sales
permitted or required pursuant to the terms of the Purchase Agreement.
SECTION 12. Collateral Agent Appointed Attorney-in-Fact. The
Borrower and the Lender each appoints the Collateral Agent its respective
attorney-in-fact with full authority in the place and stead of the Borrower or
the Lender, as the case may be, and in the name of the Borrower or the Lender,
as the case may be, or otherwise, from time to time in the Collateral Agent's
discretion, after an Event of Default has occurred and is continuing, to take
any action and to execute any instrument that the Collateral Agent may deem
necessary or advisable to accomplish the purposes of this Agreement, including,
without limitation, to (i) ask, demand, collect, sue for, recover, compromise,
receive and give acquittances and receipts for moneys due and to become due
under or in connection with the Collateral, (ii) receive, endorse and collect
all drafts or other instruments and documents made payable to the Borrower or
the Lender, as the case may be, in connection therewith or representing any
payment, dividend or other distribution in respect of the Collateral or any
part thereof and to give full discharge for the same, (iii) file any claims or
take any action or institute any proceedings which the Collateral Agent may
deem to be necessary or desirable for the collection of any of the Collateral,
(iv) enforce the rights of the Collateral Agent with respect to any of the
Collateral and compliance with the terms and conditions of the Assigned
Agreements and the Lender Assigned Agreements, (v) pay or discharge taxes or
Liens levied or placed upon or threatened against the Collateral, the legality
or validity thereof and the amounts necessary to discharge the same to be
determined by the Collateral Agent in its sole discretion, and such payments
made by the Collateral Agent to become obligations of the Borrower to the
Collateral Agent, due and payable in accordance with Section 9.06 of the Credit
Agreement, (vi) generally sell, transfer, pledge, make any agreement with
respect to or otherwise deal with any of the Collateral as fully and completely
as though the Collateral Agent were the absolute owner thereof for all
purposes, and (vii) do,
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at the Collateral Agent's option and the Borrower's expense, at any time, or
from time to time, all acts and things that the Collateral Agent deems
necessary to protect, preserve or realize upon the Collateral and the
Collateral Agent's security interest therein, in order to effect the intent of
this Agreement, all as fully and effectively as the Borrower or the Lender
might do, including but not limited to, occupying any premises of the Borrower
or the Servicer where the books, records, Related Contracts, credit files,
computer tapes and/or File Tapes relating to the Pledged Receivables are
maintained and utilize such premises, the equipment located thereon and the
personnel of the Borrower or the Servicer employed thereat (who may be employed
by the Collateral Agent if such personnel so agree) to administer, service and
collect the Pledged Receivables. The Collateral Agent agrees that, if
Broadway's appointment to act as the Servicer of the Receivables pursuant to
the Purchase Agreement is terminated for any reason and a successor Servicer
has not been appointed in accordance with the terms of the Purchase Agreement,
the Collateral Agent will accept such appointment and act as the Servicer of
the Receivables in accordance with the terms of the Purchase Agreement.
SECTION 13. Collateral Agent May Perform. If the Borrower or
the Lender fails to perform any agreement contained herein or if a Default or
an Event of Default shall have occurred and be continuing, the Collateral Agent
may at any time itself perform, or cause performance of, such agreement.
Without limiting the foregoing, the Collateral Agent shall at all times have
the right to perform the Lender's obligations under the Lender Assigned
Agreements, to compel performance by the other parties thereto, and to
otherwise exercise all remedies available to the Lender thereunder and to
terminate, amend, supplement or modify the Lender Assigned Agreements on the
Lender's behalf. In such case, the expenses of the Collateral Agent incurred
in connection therewith shall be payable by the Borrower under Section 18.
SECTION 14. The Collateral Agent. (a) Each of the Agent, the
Lender, the Trustee, the LOC Agent, the Depositary and the Liquidity Agent
hereby appoints and authorizes the Collateral Agent to take such action as
agent on its behalf and to exercise such powers and discretion under this
Agreement as are delegated to the Collateral Agent by the terms hereof,
together with such powers as are reasonably incidental thereto. The Collateral
Agent hereby agrees to act as the Collateral Agent on the terms and con-
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ditions provided in this Agreement. As to any action not expressly provided
for by this Agreement, the Collateral Agent shall not be required to exercise
any discretion or to take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions of the Controlling Party, and such
instructions shall be binding upon the Secured Parties; provided, however, that
the Collateral Agent shall not be required to take any action which exposes the
Collateral Agent to personal liability or which is contrary to any of the
Facility Documents or applicable law. The Collateral Agent shall be entitled
to rely on any communication, instrument, paper or other document believed by
it to be genuine and correct and to have been signed or sent by the proper
Person or Persons. The Collateral Agent shall provide the LOC Agent, the
Depositary, the Liquidity Agent, the Trustee and the Agent with copies of all
notices received by it in accordance with this Agreement. For the purposes of
this Agreement, "Controlling Party" shall mean the LOC Agent; provided that, at
any time at which the LOC Providers shall be in default in respect of their
obligations under the LOC, the Liquidity Agent shall be the "Controlling
Party"; provided further, that, from and after the date on which all of the
Secured Obligations other than the obligations of the Borrower in respect of
the Indenture Notes and the Indenture have been paid in full, the Trustee shall
be the "Controlling Party."
(b) Neither the Collateral Agent nor the Controlling Party
nor any of their respective affiliates, directors, officers, agents or
employees shall be liable for any action taken or omitted to be taken by it or
them under or in connection with this Agreement or for errors in judgment,
except for its or their own gross negligence, willful misconduct or bad faith
as determined by a final judgment of a court of competent jurisdiction.
(c) The powers conferred on the Collateral Agent hereunder
are solely to protect its interest in the Collateral and shall not impose any
duty upon the Collateral Agent to exercise any such powers, except as otherwise
provided in subsection (a) above. Except for the exercise of reasonable care
in the custody and preservation of any Collateral in its possession and
accounting for moneys actually received by it hereunder, the Collateral Agent
shall have no duty as to any Collateral or as to any rights pertaining thereto.
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(d) The Collateral Agent shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral in its
possession if the Collateral is accorded treatment substantially equal to that
which the Collateral Agent accords its own property, it being understood that
(i) neither the Collateral Agent nor any of the Secured Parties shall have
responsibility for (A) taking any necessary steps to preserve rights against
any parties hereto or the parties for whom they are acting as agents or (B) the
collection of any proceeds of any Collateral or by reason of any invalidity,
lack of value or uncollectibility of any of the payments received by it from
Obligors or otherwise and (ii) neither the Collateral Agent nor the Cash
Collateral Bank shall have any responsibility for evaluating, selecting or in
any way rendering any advice with respect to any Investments.
(e) GE Capital and its Affiliates may generally engage in any
kind of business with the Lender, the Borrower, the Cash Collateral Bank, the
LOC Providers, the Trustee and the Liquidity Lenders, any of their respective
Affiliates and any person who may do business with or own securities of the
Lender, the Borrower, the Cash Collateral Bank, the LOC Providers, the Trustee,
the Noteholders and the Liquidity Lenders or any of their respective
Affiliates, all as if GE Capital were not Collateral Agent and without any duty
to account therefor to any party to this Agreement or any other Secured Party.
Each Secured Party expressly acknowledges that GE Capital is the lender under
that certain Credit Agreement dated as of October 8, 1992 between GE Capital
and Broadway Stores, Inc. (formerly Carter Hawley Hale Stores, Inc.).
SECTION 15. Remedies Upon Default; Application of Collateral.
(a) If either (x) any Event of Default shall have occurred and be continuing or
(y) any "event of default" under (and as defined in) the Indenture shall have
occurred and be continuing following the payment in full of the Secured
Obligations under the Credit Agreement, the Reimbursement Agreement, the
Liquidity Agreement, the Depositary Agreement and the Commercial Paper, then:
(i) The Cash Collateral Bank may, at the instruction of the
Collateral Agent, without notice to the Borrower except as required by law
and at any time or from time to time, charge, set off and otherwise apply
all or any part of the Secured Obligations against the Cash Collateral
Account or the Blocked
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Deposit Accounts, or any part thereof in accordance with the priorities
set forth in Section 15(b).
(ii) The Collateral Agent, acting pursuant to instructions
as provided below, may exercise in respect of the Collateral, in
addition to any and all other rights and remedies provided for herein or
otherwise available to it, all the rights and remedies of a secured party
on default under the UCC as in effect in the State of New York (such
rights and remedies of the Collateral Agent to be cumulative and
nonexclusive), and the Collateral Agent may also, without notice except as
specified below solicit and accept bids for and sell the Collateral or any
part thereof in one or more parcels at public or private sale, at any
exchange, broker's board or at any of the Collateral Agent's offices or
elsewhere, for cash, on credit or for future delivery, and upon such other
terms as the Collateral Agent may deem commercially reasonable; provided,
however, that the Collateral Agent may not effect any sale of the
Purchased Receivables unless (1) the proceeds of such sale are sufficient
to pay in full all of the Secured Obligations specified in clauses First
through and including Twelfth of Section 15(b) below or (2) the holders of
66-2/3% in principal amount of the outstanding Indenture Notes consent to
such sale. The Borrower agrees that, to the extent notice of sale shall
be required by law, at least ten Business Days' notice to the Borrower of
the time and place of any public sale or the time after which any private
sale is to be made shall constitute reasonable notification. The
Collateral Agent shall not be obligated to make any sale of Collateral
regardless of notice of sale having been given. The Collateral Agent may
adjourn any public or private sale from time to time by announcement at
the time and place fixed therefor, and such sale may, without further
notice, be made at the time and place to which it was so adjourned.
(iii) If a sale of the Collateral or any part or parcel
thereof is being made, the Collateral Agent shall follow the instructions
of the Controlling Party. The Controlling Party may instruct the
Collateral Agent to exercise any other right or power of the Collateral
Agent under the Facility Documents and, subject to Section 14, the
Collateral Agent shall follow the instructions of the Controlling Party.
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(iv) The Collateral Agent may exercise at the Borrower's
expense any and all rights and remedies of the Borrower under or in
connection with the Assigned Agreements or the other Borrower Collateral
or of the Lender under or in connection with the Lender Assigned
Agreements or the other Lender Collateral, or both in respect of the
Collateral, including, without limitation, any and all rights of the
Borrower or the Lender to demand or otherwise require payment of any
amount under, or performance of any provision of, the Assigned Agreements
or the Lender Assigned Agreements, as the case may be.
(v) All payments received by the Borrower or the Lender under or
in connection with the Borrower Collateral or Lender Collateral shall be
received in trust for the benefit of the Collateral Agent, shall be
segregated from other funds of the Borrower and the Lender and shall be
forthwith paid over to the Collateral Agent in the same form as so
received (with any necessary endorsement).
(b) If an Event of Default shall have occurred and be
continuing or an Early Amortization Event shall have occurred, or any such
event would occur as a result of the application of amounts in the Cash
Collateral Account in accordance with the priorities set forth in Section 7(a)
hereof, then any cash held by the Cash Collateral Bank or the Collateral Agent
as Account Collateral, whether from Purchased Receivables or otherwise, and all
cash proceeds received by the Cash Collateral Bank or the Collateral Agent in
respect of any sale of, collection from, or other realization upon all or any
part of the Collateral shall be applied as follows:
First, to the payment of any costs or expenses payable to the
Collateral Agent pursuant to Section 18(b) of this Agreement;
Second, to the payment of any amounts owing to the Servicer or
any successor thereto (including GE Capital if it is acting as the
Successor Servicer);
Third, ratably to the daily pro rata portion of amounts payable
under Sections 2.07(b) and (c) of the Credit Agreement, which amounts
shall be segregated within the Cash Collateral Account for payment to the
appropriate party on its fee payment date;
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Fourth, to amounts due as interest on any Commercial Paper;
Fifth, to amounts due as interest or overdue interest on any
Loans; provided that the maximum amount payable pursuant to this clause
Fifth with respect to any period, when added to the amount distributed in
respect of such period pursuant to clause Fourth above, shall not exceed
an amount equal to interest on the Note for such period at a rate per
annum equal to the higher of (i) 10.92% and (ii) the H.15 Commercial Paper
Rate in effect from time to time;
Sixth, to amounts due as interest on the Class A Notes at a rate
per annum not in excess of 7.55%;
Seventh, to amounts due as interest on the Class B Notes at a
rate per annum not in excess of 11%;
Eighth, to amounts due as principal of any Loans (but not in
excess of the principal amount then due and owing under the Note);
Ninth, to amounts due as principal of Commercial Paper (but not
in excess of the principal amount then due and owing under the Note);
Tenth, after all Commercial Paper has been retired and the Loans
have been reduced to zero, to amounts owing to the LOC Providers under
Sections 2.03 and 2.05 of the Reimbursement Agreement; provided, that the
maximum amount payable pursuant to this clause Tenth with respect to any
period for interest on drawings under the Letter of Credit pursuant to
Section 2.03 of the Reimbursement Agreement and the LOC Commitment Fee
pursuant to Section 2.05 of the Reimbursement Agreement, when added to the
amounts distributed in respect of such period pursuant to clauses Fourth
and Fifth above, shall not exceed an amount equal to interest on the
principal amount of Blue Hawk Note for such period at a rate per annum
equal to the higher of (i) 10.92% and (ii) the H.15 Commercial Paper Rate
in effect from time to time;
Eleventh, to the outstanding principal of the Class A Notes until
the principal of the Class A Notes is reduced to zero;
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Twelfth, to the outstanding principal of the Class B Notes until
the principal of the Class B Notes is reduced to zero;
Thirteenth, to amounts due as interest or overdue interest on any
Loans, to the extent not paid in accordance with clause Fifth above;
Fourteenth, to amounts due and owing to the LOC Providers under
Sections 2.03 and 2.05 of the Reimbursement Agreement, to the extent not
paid in accordance with clause Tenth above;
Fifteenth, to the payment of any amounts payable to the
Collateral Agent pursuant to Section 18(a) of this Agreement;
Sixteenth, ratably to any other amounts owing under the Facility
Documents;
Seventeenth, to the payment of any Make-Whole Premium due and
owing in respect of the Class A Notes;
Eighteenth, to the payment of any Make-Whole Premium due and
owing in respect of the Class B Notes;
Nineteenth, to amounts due as interest or overdue interest on the
Class A Notes, to the extent not paid in accordance with clause Sixth
above; and
Twentieth, to amounts due as interest or overdue interest on the
Class B Notes, to the extent not paid in accordance with clause Seventh
above.
Any surplus of such cash or cash proceeds held by the Cash Collateral Bank or
the Collateral Agent and remaining after the payment in full of all the Secured
Obligations and all outstanding Commercial Paper has been paid in full shall be
paid over to the Borrower or to whomsoever may be lawfully entitled thereto
(including, but not limited to, the lender(s) under the Retailer Credit
Agreement). For the purposes of this Section 15(b), "H.15 Commercial Paper
Rate" means the rate for commercial paper having a maturity of one month as
published from time to time by the Board of Governors of the Federal Reserve
System in "Statistical Release H.15 (519), Selected Interest Rates," or in any
successor publication, under the heading "Commercial Paper."
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(c) The Borrower hereby waives any and all rights it may have
to contest any exercise by the Collateral Agent of any of its rights or
remedies under this Section 15.
SECTION 16. Drawings Under the LOC. (a) During the period
commencing on the second Business Day preceding the L/C Expiration Date (as
defined in the Reimbursement Agreement) then in effect and ending on such L/C
Expiration Date, the Collateral Agent shall execute and deliver to the Letter
of Credit Agent a Certificate for Drawing in the amount of the entire Letter of
Credit Amount (as defined in the Reimbursement Agreement) determined as of the
L/C Expiration Date.
(b) At or prior to 2:30 p.m. (New York City time) on any
date, the Collateral Agent shall determine whether the Cash Collateral Account
and the Lender's Account have sufficient funds in the amount of the Required
Payments due on such date. In the event that there are insufficient funds to
make such Required Payments the Collateral Agent shall provide notice
(telephonic or written) to the Borrower, the Trustee and the Agent of such
insufficiency and, if such insufficiency continues to exist as of the earlier
of (i) 1:00 p.m. (New York City time) on the second Business Day following the
date such Required Payments were due or (ii) 2:45 p.m. (New York City time) on
the Liquidity Termination Date, the Collateral Agent shall immediately execute
and deliver to the Letter of Credit Agent a Certificate for Drawing
(substantially in the form of Annex 1 to the Letter of Credit) on the Letter of
Credit in an amount equal to the lesser of (x) the amount of such insufficiency
and (y) the Letter of Credit Amount then in effect; provided, however, that if
the Letter of Credit has been drawn to fund the Reserve Account, pursuant to
Section 2.12 of the Reimbursement Agreement, the Collateral Agent shall instead
withdraw funds from the Reserve Account, in accordance with this Agreement, and
shall promptly execute and deliver to the LOC Agent, the Agent, the Trustee and
the Borrower a Notice of Reserve Account Draw (substantially in the form of
Exhibit II to the Reimbursement Agreement); provided further, that if such an
insufficiency exists at 12:30 p.m. (New York City time) on any date on which
the CP Matured Value of the Commercial Paper maturing on such date exceeds an
amount equal to the sum of (1) the aggregate proceeds of the Commercial Paper
issued on such date plus (2) the funds available in the Lender's Account and
the Cash Collateral Account to pay such maturing Commercial Paper plus (3) the
aggregate amount of the
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Refunding Loans that the Lender is permitted to borrow on such date in
accordance with the terms of the Liquidity Agreement, then the Collateral Agent
shall execute and deliver such Certificate of Drawing or such Notice of Reserve
Account Draw, as the case may be, not later than 1:00 p.m. (New York City time)
on such date.
SECTION 17. Amendments, Etc. No amendment of any provision of
this Agreement shall in any event be effective unless the same shall be in
writing and signed by the Borrower, the LOC Agent, the Liquidity Agent, the
Cash Collateral Bank, the Lender, the Trustee, the Agent and the Collateral
Agent, no waiver of any provision of this Agreement, nor consent to any
departure by the Borrower therefrom, shall in any event be effective unless the
same shall be in writing and signed by, the LOC Agent, the Liquidity Agent, the
Cash Collateral Bank, the Agent, the Trustee and the Collateral Agent, and then
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given. No failure to exercise nor any delay in
exercising on the part of the Collateral Agent or any Secured Party any right,
power or privilege under this Agreement, shall operate as a waiver thereof;
further, no single or partial exercise of any right, power or privilege under
this Agreement shall preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The Borrower shall promptly
provide each Rating Agency with copies of all amendments to this Agreement.
SECTION 18. Indemnity and Expenses. (a) The Borrower agrees to
indemnify the Collateral Agent, the Cash Collateral Bank and each of their
respective directors, officers, employees and agents (each an "Indemnified
Person") from and against any and all claims, damages, losses, liabilities and
expenses arising out of or in connection with or resulting from this Agreement
(including, without limitation, enforcement of this Agreement), unless and to
the extent such claim, damage, loss, liability or expense was attributable to
the gross negligence, willful misconduct or bad faith of the Lender or any
Indemnified Person as determined by a final judgment of a court of competent
jurisdiction.
(b) The Borrower agrees to pay to the Collateral Agent from
time to time, upon demand, the amount of any and all costs and expenses,
including the reasonable fees and expenses of its counsel and of any experts
and agents, that the Collateral Agent may incur in connection with (i) the
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administration of this Agreement, (ii) the custody or preservation of, or the
sale of, collection from, or other realization upon, any of the Collateral
(including, but not limited to, any and all costs and expenses incurred by the
Collateral Agent in collecting the Pledged Receivables or otherwise acting as a
Successor Servicer in respect thereof pursuant to the Purchase Agreement),
(iii) the exercise or enforcement of any of the rights of the Collateral Agent
or any of the Secured Parties, the Agent, the Lender, the LOC Providers, the
Depositary, the Trustee or the Liquidity Lenders hereunder, (iv) the failure by
the Borrower to perform or observe any of the provisions hereof or (v) any
action taken by the Collateral Agent pursuant to Section 10 or 13 hereof.
(c) The foregoing provisions of this Section 18 are in
furtherance and not in limitation of the Borrower's obligations under Sections
8.01 and 9.06 of the Credit Agreement.
(d) The Collateral Agent agrees that the obligations of the
Lender and the Borrower hereunder shall be non-recourse to the Lender and the
Borrower, and shall be payable solely out of the Collateral and the Collateral
Agent shall not look to any other property or assets of the Lender or the
Borrower in respect of such obligations. In the event that there is any
insufficiency with respect to any amount owing to the Collateral Agent, such
insufficiency shall not constitute a claim against the Lender or the Borrower
and such indebtedness shall be subordinated to the Commercial Paper and the
Non-Affiliate Subordinated Notes as provided in Section 15(b) hereof.
SECTION 19. Successor Collateral Agent. The Collateral Agent
may resign at any time by giving written notice thereof to the Depositary, the
LOC Agent, the Liquidity Agent, the Agent, the Lender, the Trustee, the Cash
Collateral Bank and the Borrower, such resignation to be effective upon the
acceptance by a successor Collateral Agent of its appointment as such. Upon
any such resignation, the Agent, with the consent of the Controlling Party,
shall have the right to appoint a successor Collateral Agent. If no successor
Collateral Agent shall have been so appointed by the Agent and shall have
accepted such appointment, within 30 days after the retiring Collateral Agent's
giving of notice of resignation, the retiring Collateral Agent may, on behalf
of the Agent, appoint a successor Collateral Agent, which shall be a commercial
bank organized under the laws of the United
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States of America or of any State thereof and having a combined capital and
surplus of at least $100,000,000. Upon the acceptance of any appointment as
Collateral Agent hereunder by a successor Collateral Agent, such successor
Collateral Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Collateral Agent, and the
retiring Collateral Agent shall be discharged from its duties and obligations
under this Agreement.
SECTION 20. Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing (including
telecopier) and, if to the Agent, the Lender or the Borrower, mailed,
telecopied, delivered by nationally recognized overnight courier or hand
delivered to it, addressed to it at the address of such party specified in the
Credit Agreement, if to the Collateral Agent, mailed, telecopied, delivered by
nationally recognized overnight courier or hand delivered to it at 2323 N.
Central Expressway, Suite 101, Richardson, Texas 75080, Attention: Harold
Goehl, Telephone No. (214) 907-4971, Telecopier No. (214) 907-4912, if to the
LOC Agent, mailed, telecopied, delivered by nationally recognized overnight
courier or hand delivered to it at the address specified in the Reimbursement
Agreement, if to the Liquidity Agent, mailed, telecopied, delivered by
nationally recognized overnight courier or hand delivered to it at the address
specified in the Liquidity Agreement, if to the Cash Collateral Bank mailed,
telecopied, delivered by nationally recognized overnight courier or hand
delivered to it at Four Albany Street, New York, New York 10006, if to the
Trustee, mailed, telecopied, delivered by nationally recognized overnight
courier or hand delivered to it at the address specified in the Indenture, or
as to any party, at such other address as shall be designated by such party in
a written notice to each other party complying as to delivery with the terms of
this Section. All such notices and other communications shall be effective
when mailed, telecopied (with telephone confirmation of receipt received), or
delivered to the courier service, addressed as aforesaid.
SECTION 21. No Waiver; Cumulative Remedies. Neither the
Collateral Agent nor any of the Secured Parties shall by any act, delay,
omission or otherwise be deemed to have waived any of its rights or remedies
hereunder, and no waiver shall be valid unless in writing and signed by the
Collateral Agent. A waiver by the Collateral Agent of any right or remedy
hereunder on any one occasion shall not be
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construed as a bar to any right or remedy which the Collateral Agent would
otherwise have on any future occasion.
SECTION 22. Continuing Security Interest. This Agreement shall
create a continuing security interest in the Collateral and shall (i) remain in
full force and effect until the payment in full (after the Commitment
Termination Date) of the Secured Obligations, (ii) be binding upon the Borrower
and the Lender and their successors and assigns, including but not limited to
any trustee or examiner for the Borrower under the Bankruptcy Code, and (iii)
inure, together with the rights and remedies of the Collateral Agent hereunder,
to the benefit of the Collateral Agent and the Secured Parties and their
respective successors, transferees and assigns. Upon the payment in full
(after the Commitment Termination Date) of the Secured Obligations, the
Borrower shall be entitled to the return, upon its request and at its expense,
of such of the Collateral as shall not have been sold or otherwise applied
pursuant to the terms hereof, at which time the Collateral Agent shall, at the
expense and request of the Borrower, reassign and deliver to the Borrower, or
to such Person or Persons as may be lawfully entitled thereto, against receipt,
such of the Collateral (if any) as shall not have been sold or otherwise
applied by the Collateral Agent pursuant to the terms hereof, together with
appropriate instruments of reassignment and release.
SECTION 23. Further Indemnification. Without limiting the
obligations of the Borrower under Section 18 above, the Borrower agrees to pay,
and to save the Collateral Agent and the Secured Parties harmless from, any and
all liabilities with respect to, or resulting from any delay in paying, any and
all excise, sales or other similar taxes which may be payable or determined to
be payable with respect to any of the Collateral or in connection with any of
the transactions contemplated by this Agreement.
SECTION 24. Governing Law; Terms. This Agreement shall be
governed by, and construed in accordance with, the law of the State of New
York, except to the extent that the validity or perfection of the security
interest hereunder, or remedies hereunder, in respect of any particular
Collateral are governed by the law of a jurisdiction other than the State of
New York. Unless otherwise defined herein or in the Credit Agreement, terms
used in Article 9 of the Uniform Commercial Code in the State of New York are
used herein as therein defined.
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SECTION 25. No Petition in Bankruptcy. Each of the parties to
this Agreement severally and not jointly, hereby covenants and agrees that,
prior to the date which is one year and one day after the payment in full of
all outstanding Commercial Paper, Loans and Indenture Notes, it will not
institute against, or join any other Person in instituting against, the Lender
or the Borrower any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings or other similar proceeding under the laws of the
United States or any state of the United States.
SECTION 26. Waiver of Jury Trial. EACH OF THE PARTIES HERETO
AGREES TO WAIVE ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF THIS AGREEMENT. The scope of this waiver is
intended to be all-encompassing of any and all disputes that may be filed in
any court and that relate to the subject matter of this transaction, including
without limitation, contract claims, tort claims, breach of other common law
and statutory claims. Each of the parties hereto acknowledges that this waiver
is a material inducement for each other party to enter into a business
relationship, that each other party has already relied on the waiver in
entering into this Agreement and that each will continue to rely on the waiver
in their related future dealings. Each of the parties hereto further warrants
and represents that each has reviewed this waiver with its legal counsel, and
that each knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT
MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO
ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
AGREEMENT. In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.
SECTION 27. Jurisdiction; Consent to Service of Process. (a)
The Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the non-exclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City; and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, the other Facility Documents or any of the Basic
Documents (as defined in the Indenture), or for recognition of enforcement of
any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may
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be heard and determined in such New York State or, to the extent permitted by
law, in such Federal court. Each of the parties hereto agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement shall affect any right that the
Collateral Agent may otherwise have to bring any action or proceeding relating
to this Agreement, the other Facility Documents or the Basic Documents against
the Borrower or its properties in the courts of any jurisdiction.
(b) The Borrower hereby irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement, the other Facility
Documents or the Basic Documents in any New York State or Federal court. Each
of the parties hereto hereby irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any such court.
(c) The Borrower irrevocably consents to service of process in
the manner provided for notices in Section 20. Nothing in this Agreement will
affect the right of any party to this Agreement to serve process in any other
manner permitted by law.
SECTION 28. Headings. Section and subsection headings in this
Agreement are included herein for convenience of reference only and shall not
constitute a part of this Agreement or be given any substantive effect.
SECTION 29. Severability. In case any provision in or
obligation under this Agreement shall be invalid, illegal or unenforceable in
any jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.
SECTION 30. Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original and all of
which together shall constitute one and the same Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered by their respective officers thereunto duly
authorized, as of the date first above written.
BROADWAY RECEIVABLES, INC.
(formerly CHH Receivables, Inc.),
as the Borrower
By_________________________________
Title:
GENERAL ELECTRIC CAPITAL CORPORATION,
as the Agent, the Liquidity Agent
and the LOC Agent
By_________________________________
Title:
BLUE HAWK FUNDING CORPORATION,
as the Lender
By_________________________________
Title:
BANKERS TRUST COMPANY,
as Trustee
By_________________________________
Title:
BANKERS TRUST COMPANY,
as the Cash Collateral Bank
By_________________________________
Title:
GENERAL ELECTRIC CAPITAL CORPORATION,
as the Collateral Agent
By_________________________________
Title:
-40-
44
SCHEDULE I
BLOCKED DEPOSIT ACCOUNTS
Name and Address Mailing Address of
of Bank Blocked Deposit Account Number
- ----------------------- ------------------ --------------
45
SCHEDULE II
POST OFFICE BOXES
1. Post Office Box 52094
Phoenix General Mail Facility
4949 East Van Buren Street
Phoenix, Arizona 85026
46
SCHEDULE III
EQUIPMENT LOCATIONS
1. Broadway Stores, Inc.
Phoenix Administrative Center (PAC)
1345 South 52nd Street
Tempe, Arizona 85281
2. Broadway Stores, Inc.
Information Services
1600 North Kraemer Boulevard
Anaheim, California 92806
47
SCHEDULE IV
Offices Where Related Contracts and Books,
Records, Etc. Evidencing Receivables Are Kept
Broadway Southern California
3880 N. Mission Road
Los Angeles, CA 90031
Broadway Southwest
1524 W. 14th Street
Tempe, AZ 85281
Phoenix Administrative Center (PAC)
1345 So. 52nd Street
Tempe, AZ 85281
Information Services
1600 N. Kraemer Blvd.
Anaheim, CA 92806
Arcus Data Security, Inc.
288 Navajo
San Marcos, CA 92069