Exhibit 4.13
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U.S. SECURITY AGREEMENT
among
QUALITY DISTRIBUTION, INC. (f/k/a MTL, Inc.),
VARIOUS SUBSIDIARIES OF
QUALITY DISTRIBUTION, INC.
and
CREDIT SUISSE FIRST BOSTON,
as Collateral Agent
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Dated as of June 9, 1998
and
Amended and Restated as of August 28, 1998
and
Further Amended and Restated as of May 30, 2002
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Table of Contents
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ARTICLE I SECURITY INTERESTS..........................................................................4
1.1 Grant of Security Interests..............................................................4
1.2 Power of Attorney........................................................................6
ARTICLE II GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS..........................................6
2.1 Necessary Filings........................................................................6
2.2 No Liens.................................................................................7
2.3 Other Financing Statements...............................................................7
2.4 Chief Executive Office; Records..........................................................7
2.5 Location of Inventory and Equipment......................................................8
2.6 Recourse.................................................................................8
2.7 Legal Names; Organizational Identification Number; Trade Names; Change of Name; etc......8
2.8 Jurisdiction and Type of Organization....................................................9
2.9 Collateral in the Possession of a Bailee.................................................9
2.10 As-Extracted Collateral; Timber-to-be-Cut..............................................10
ARTICLE III SPECIAL PROVISIONS CONCERNING RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS..................10
3.1 Additional Representations and Warranties...............................................10
3.2 Maintenance of Records..................................................................10
3.3 Direction to Account Debtors; Contracting Parties; etc..................................11
3.4 Modification of Terms; etc..............................................................11
3.5 Collection..............................................................................11
3.6 Instruments.............................................................................12
3.7 Further Actions.........................................................................12
3.8 Assignors Remain Liable Under Receivables and Contracts.................................12
3.9 Deposit Accounts; Etc...................................................................12
3.10 Letter-of-Credit Rights................................................................13
3.11 Commercial Tort Claims.................................................................14
3.12 Chattel Paper..........................................................................14
ARTICLE IV SPECIAL PROVISIONS CONCERNING TRADEMARKS..................................................14
4.1 Additional Representations and Warranties...............................................14
4.2 Licenses and Assignments................................................................15
4.3 Infringements...........................................................................15
4.4 Preservation of Marks...................................................................15
4.5 Maintenance of Registration.............................................................15
4.6 Future Registered Marks.................................................................16
(i)
Table of Contents
(continued)
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ARTICLE V SPECIAL PROVISIONS CONCERNING PATENTS, COPYRIGHTS AND TRADE SECRETS........................16
5.1 Additional Representations and Warranties...............................................16
5.2 Licenses and Assignments................................................................17
5.3 Infringements...........................................................................17
5.4 Maintenance of Patents and Copyrights...................................................17
5.5 Prosecution of Patent or Copyright Application..........................................18
5.6 Other Patents and Copyrights............................................................18
5.7 Remedies................................................................................18
ARTICLE VI SPECIAL PROVISIONS CONCERNING TRACTOR TRAILERS............................................18
6.1 Additional Representations and Warranties...............................................18
6.2 Maintenance of Registration.............................................................19
6.3 Subsequently Acquired Tractor Trailers..................................................19
6.4 Remedies................................................................................19
6.5 Further Assurances......................................................................20
ARTICLE VII PROVISIONS CONCERNING ALL COLLATERAL.....................................................20
7.1 Protection of Collateral Agent's Security...............................................20
7.2 Warehouse Receipts Non-Negotiable.......................................................21
7.3 Further Actions.........................................................................21
7.4 Financing Statements....................................................................21
7.5 Additional Information..................................................................21
ARTICLE VIII REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT............................................21
8.1 Remedies; Obtaining the Collateral Upon Default.........................................21
8.2 Remedies; Disposition of the Collateral.................................................23
8.3 Waiver of Claims........................................................................24
8.4 Application of Proceeds.................................................................24
8.5 Remedies Cumulative.....................................................................29
8.6 Discontinuance of Proceedings...........................................................29
ARTICLE IX INDEMNITY.................................................................................30
9.1 Indemnity...............................................................................30
9.2 Indemnity Obligations Secured by Collateral; Survival...................................31
ARTICLE X DEFINITIONS................................................................................31
ARTICLE XI MISCELLANEOUS.............................................................................41
11.1 Notices................................................................................41
11.2 Waiver; Amendment; Notice of Acceleration..............................................42
(ii)
Table of Contents
(continued)
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11.3 Obligations Absolute...................................................................43
11.4 Successors and Assigns.................................................................43
11.5 Headings Descriptive...................................................................44
11.6 GOVERNING LAW..........................................................................44
11.7 Assignor's Duties......................................................................44
11.8 Termination; Release...................................................................44
11.9 Counterparts...........................................................................46
11.10 The Collateral Agent..................................................................47
11.11 Severability..........................................................................47
11.12 Limited Obligations...................................................................47
11.13 Additional Assignors..................................................................47
11.14 Release of Assignors..................................................................47
11.15 No Third Party Beneficiaries..........................................................48
ARTICLE XII SPECIAL AGREEMENTS AND ACKNOWLEDGEMENTS BY SECURED CREDITORS.............................48
12.1 Priorities With Respect to Collateral, etc.............................................48
12.2 Right to Contest; etc..................................................................49
12.3 Payment Invalidated....................................................................50
12.4 Right to Amend. Etc....................................................................50
12.5 Creation of Future Obligations.........................................................50
12.6 Effectiveness..........................................................................51
12.7 Further Assurances.....................................................................51
ANNEX A Schedule of Chief Executive Offices/Record Locations
ANNEX B Schedule of Inventory and Equipment Locations
ANNEX C Schedule of Legal Names, Organizational Identification Numbers and Trade and Fictitious Names
ANNEX D Schedule of Marks and Applications
ANNEX E Schedule of Patents and Applications
ANNEX F Schedule of Copyrights and Applications
ANNEX G Assignment of Security Interest in Certain Patents and Trademarks
ANNEX H Assignment of Security Interest in Certain Copyrights
ANNEX I Schedule of Tractor Trailers
ANNEX J The Collateral Agent
ANNEX K Schedule of Jurisdictions and Types of Organizations
ANNEX L Schedule of Deposit Accounts
ANNEX M Description of Commercial Tort Claims
ANNEX N Form of Control Agreement Regarding Deposit Accounts
(iii)
EXHIBIT H-1-A
SECOND AMENDED AND RESTATED U.S. SECURITY AGREEMENT
U.S. SECURITY AGREEMENT, dated as of June 9, 1998, amended and restated
as of August 28, 1998 and further amended and restated as of May 30, 2002 (as so
amended and restated and as the same may be further amended, amended and
restated, modified and/or supplemented from time to time, this "Agreement"),
among each of the undersigned (each, an "Assignor" and, together with each other
entity which becomes a party hereto pursuant to Section 11.13, collectively, the
"Assignors") and CREDIT SUISSE FIRST BOSTON, as Collateral Agent (in such
capacity, together with any successor collateral agent, the "Collateral Agent"),
for the benefit of the Secured Creditors (as defined below). Except as otherwise
defined herein, terms used herein shall have the meanings provided therefor in
Article X hereof.
W I T N E S S E T H :
WHEREAS, Quality Distribution, Inc. (f/k/a MTL, Inc.)[("Holdings"),
Quality Distribution, LLC](1) (the "U.S. Borrower"), Levy Transport Ltd./Levy
Transport Ltee (the "Canadian Borrower" and, together with the U.S. Borrower,
collectively, the "Borrowers"), various financial institutions from time to time
party thereto (such financial institutions, together with their successors and
assigns, and any lenders pursuant to any Credit Agreement referred to below,
being herein collectively called the "Banks"), Lasalle Bank National Association
(f/k/a ABN AMRO Bank N.V.), The Bank of Nova Scotia, PB Capital Corporation
(f/k/a BHF-Bank Aktiengesellschaft), Bank Austria Creditanstalt Corporate
Finance, Inc. and Royal Bank of Canada, as Co-Agents, Salomon Brothers Holding
Company Inc, as Documentation Agent (in such capacity, together with any
successor documentation agent, the "Documentation Agent"), Deutsche Bank Trust
Company Americas (f/k/a Bankers Trust Company), as Syndication Agent (in such
capacity, together with any successor syndication agent, the "Syndication
Agent"), and Credit Suisse First Boston, as Administrative Agent (in such
capacity, together with any successor administrative agent, the "Administrative
Agent", and together with the Banks, each Letter of Credit Issuer, the
Documentation Agent, the Syndication Agent and the Collateral Agent, the "Bank
Creditors"), have entered into a Credit Agreement, dated as of June 9, 1998 and
amended and restated as of August 28, 1998, providing for the making of Loans to
the Borrowers and the issuance of, and participation in, Letters of Credit for
the account of the U.S. Borrower as contemplated therein (as used herein, the
term "Credit Agreement" means the Credit Agreement described above in this
paragraph, as the same has been, and may from time to time be, amended,
modified, extended, renewed, replaced, restated, supplemented or refinanced from
time to time, and including any agreement extending the maturity of, or
refinancing or restructuring (including, but not limited to, the inclusion of
additional borrowers or guarantors thereunder or any increase in the amount
borrowed) of all or any portion of, the indebtedness under such agreement or any
successor agreement, whether or not with the same agent, trustee,
representative, lenders or holders; provided that, with respect to any agreement
providing for the refinancing or replacement of indebtedness under the Credit
Agreement, such agreement shall
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(1) Bracketed text to be included if a Qualified Exchange Transaction is to be
consummated.
Exhibit H-1-A
Page 2
only be treated as, or as part of, the Credit Agreement hereunder if (i) either
(A) all obligations under the Credit Agreement being refinanced or replaced
shall be paid in full at the time of such refinancing or replacement, and all
commitments and letters of credit issued pursuant to the refinanced or replaced
Credit Agreement shall have terminated in accordance with their terms or (B) the
Required Banks shall have consented in writing to the refinancing or replacement
indebtedness being treated as indebtedness pursuant to the Credit Agreement,
(ii) the refinancing or replacement indebtedness shall be permitted to be
incurred under the Credit Agreement being refinanced or replaced (if such Credit
Agreement is to remain outstanding) and the other Credit Documents then in
effect and under the Senior [Subordinated](2) Secured Notes Documents referred
to below (if the Senior [Subordinated] Secured Notes (as defined below) remain
outstanding) and (iii) a notice to the effect that the refinancing or
replacement indebtedness shall be treated as issued under the Credit Agreement
shall be delivered by the U.S. Borrower to the Collateral Agent);
WHEREAS, [Holdings and/or] one or more of the Borrowers may from time
to time enter into one or more (i) interest rate protection agreements
(including, without limitation, interest rate swaps, caps, floors, collars and
similar agreements), (ii) foreign exchange contracts, currency swap agreements,
commodity agreements or other similar agreements or arrangements designed to
protect against the fluctuations in currency values and/or (iii) other types of
hedging agreements from time to time (each such agreement or arrangement with an
Other Creditor (as hereinafter defined), an "Interest Rate Protection Agreement
or Other Hedging Agreement"), with Credit Suisse First Boston in its individual
capacity ("CSFB"), any Bank or a syndicate of financial institutions organized
by CSFB or any such Bank, or an affiliate of CSFB or any such Bank (CSFB, any
such Bank or Banks or affiliate or affiliates of CSFB or such Bank or Banks
(even if CSFB or any such Bank ceases to be a Bank under the Credit Agreement
for any reason) and any such institution that participates in such Interest Rate
Protection Agreements or Other Hedging Agreements and their subsequent
successors and assigns collectively, the "Other Creditors");
WHEREAS, the U.S. Borrower, as issuer, and the other Assignors [(other
than Holdings)](3), as guarantors, have entered into the Senior [Subordinated]
Secured Notes Indenture (as defined below) with the trustee thereunder (in such
capacity, together with any successor trustee, the "Senior [Subordinated]
Secured Notes Indenture Trustee"), providing for the issuance of Senior
[Subordinated] Secured Notes by the U.S. Borrower (with the holders from time to
time of such Senior [Subordinated] Secured Notes being herein called the "Senior
[Subordinated] Secured Noteholders");
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(2) References to "[Subordinated]" throughout this Agreement will be included in
the event a Qualified Exchange Transaction is to be consummated.
(3) To be included in the event a Qualified Exchange Transaction is to be
consummated.
Exhibit H-1-A
Page 3
[WHEREAS, pursuant to the Holdings Guaranty, Holdings has guaranteed to
the Bank Creditors and the Other Creditors the payment when due of the
Guaranteed Obligations;](4)
WHEREAS, pursuant to the U.S. Borrower Guaranty, the U.S. Borrower has
guaranteed to the Bank Creditors and the Other Creditors the payment when due of
the Canadian Guaranteed Obligations;
WHEREAS, pursuant to a U.S. Subsidiaries Guaranty, dated as of June 9,
1998 and amended and restated as of August 28, 1998 (as so amended and restated
and as the same may be further amended, amended and restated, modified and/or
supplemented from time to time, the "U.S. Subsidiaries Guaranty"), each U.S.
Subsidiary Guarantor has jointly and severally guaranteed to the Bank Creditors
and the Other Creditors the payment when due of all obligations and liabilities
of [Holdings and] the Borrowers under or with respect to the Credit Documents
and each Interest Rate Protection Agreement or Other Hedging Agreement;
WHEREAS, pursuant to certain of the Senior [Subordinated] Secured Notes
Documents, the Assignors have jointly and severally guaranteed the payment when
due of all obligations and liabilities of the U.S. Borrower under or with
respect to the Senior [Subordinated] Secured Notes Documents;
WHEREAS, certain of the Assignors have heretofore entered into a U.S.
Security Agreement, dated as of June 9, 1998 and amended and restated as of
August 18, 1998 (as so amended and restated and as the same has been further
amended, modified and/or supplemented to but not including the date hereof, the
"Original Amended and Restated U.S. Security Agreement");
WHEREAS, it is a condition precedent to the making of Loans to the
Borrowers and the issuance of, and participation in, Letters of Credit for the
account of the U.S. Borrower under the Credit Agreement and to the Other
Creditors entering into Interest Rate Protection Agreements or Other Hedging
Agreements on and after the date of the consummation of the Exchange Transaction
that each Assignor shall have executed and delivered to the Collateral Agent
this Agreement;
WHEREAS, it is a condition precedent to the issuance of the Senior
[Subordinated] Secured Notes by the U.S. Borrower under the Senior
[Subordinated] Secured Notes Indenture that each Assignor shall have executed
and delivered to the Collateral Agent this Agreement, providing for, inter alia,
the grant of a security interest to secure the Senior [Subordinated] Secured
Notes Obligations on the terms set forth therein; and
WHEREAS, each Assignor desires to execute this Agreement to satisfy the
condition described in the preceding paragraph and to amend and restate the
Original Amended and Restated U.S. Security Agreement in the form of this
Agreement;
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(4) To be included in the event a Qualified Exchange Transaction is to be
consummated.
Exhibit H-1-A
Page 4
NOW, THEREFORE, in consideration of the benefits accruing to each
Assignor, the receipt and sufficiency of which are hereby acknowledged, each
Assignor hereby makes the following representations and warranties to the
Collateral Agent for the benefit of the Secured Creditors (as defined below) and
hereby covenants and agrees with the Collateral Agent for the benefit of the
Secured Creditors as follows:
ARTICLE I
SECURITY INTERESTS
1.1 Grant of Security Interests. (a) As security for the prompt and
complete payment and performance when due of all of the Obligations (excluding
the Senior [Subordinated] Secured Notes Obligations in the case of an
assignment, transfer, grant or pledge of Excluded Senior [Subordinated] Secured
Notes Collateral by any Assignor), each Assignor does hereby assign and transfer
unto the Collateral Agent for the benefit of the Secured Creditors (excluding
the Senior [Subordinated] Secured Notes Creditor in the case of any assignment,
transfer, pledge or grant of Excluded Senior [Subordinated] Secured Notes
Collateral by any Assignor), and does hereby pledge and grant to the Collateral
Agent for the benefit of the Secured Creditors (excluding the Senior
[Subordinated] Secured Notes Creditor in the case of any assignment, transfer,
pledge or grant of Excluded Senior [Subordinated] Secured Notes Collateral by
any Assignor), a continuing security interest in, all of the right, title and
interest of such Assignor in, to and under all of the following personal
property and fixtures (and all rights therein) of such Assignor, or in which or
to which such Assignor has any rights, in each case, whether now existing or
hereafter from time to time acquired:
(i) each and every Receivable;
(ii) all Contracts, together with all Contract Rights arising
thereunder;
(iii) all Inventory;
(iv) the Cash Collateral Account and any other cash collateral
account established for such Assignor for the benefit of the Secured
Creditors and all moneys, securities and instruments deposited or
required to be deposited in such Cash Collateral Account;
(v) all Equipment;
(vi) all Marks, together with the registrations and right to
all renewals thereof, and the goodwill of the business of such Assignor
symbolized by the Marks;
(vii) all Patents and Copyrights and all reissues, renewals
and extensions thereof;
(viii) all computer programs of such Assignor and all
intellectual property rights therein and all other proprietary
information of such Assignor, including, but not limited to, trade
secrets and Trade Secret Rights;
Exhibit H-1-A
Page 5
(ix) all insurance policies;
(x) all other Goods, General Intangibles, Chattel Paper
(including without limitation all Tangible Chattel Paper and all
Electronic Chattel Paper), Documents and Instruments of such Assignor;
(xi) all Permits;
(xii) all Tractor Trailers;
(xiii) all cash;
(xiv) all Commercial Tort Claims;
(xv) all Deposit Accounts and all other demand, deposit, time,
savings, cash management, passbook and similar accounts maintained by
such Assignor with any Person and all monies, securities, Instruments
and other investments deposited or required to be deposited in any of
the foregoing;
(xvi) all Investment Property;
(xvii) all Letter-of-Credit Rights (whether or not the
respective letter of credit is evidenced by a writing);
(xviii) all Software and all Software licensing rights, all
writings, plans, specifications and schematics, all engineering
drawings, customer lists, goodwill and licenses, and all recorded data
of any kind or nature, regardless of the medium of recording;
(xix) all Supporting Obligations;
(xx) all Proceeds and products of any and all of the foregoing
(all of the above, including this clause (xx), collectively, the
"Collateral").
(b) Notwithstanding anything to the contrary contained above in this
Section 1 or elsewhere in this Agreement, no Excluded Senior [Subordinated]
Secured Notes Collateral hereunder shall secure any of the Senior [Subordinated]
Secured Notes Obligations (although the Excluded Senior [Subordinated] Secured
Notes Collateral shall secure all other Obligations hereunder).
(c) As security for the prompt and complete payment and performance
when due of all of the Senior [Subordinated] Secured Notes Obligations, each
Assignor does hereby assign and transfer unto the Collateral Agent and does
hereby pledge and grant to the Collateral Agent for the benefit of the Senior
[Subordinated] Secured Notes Creditor, a continuing security interest in, all of
the right, title and interest of such Assignor in, to and under all of the
Collateral (other than the Excluded Senior [Subordinated] Secured Notes
Collateral), whether now existing or hereafter from time to time acquired,
subject to the Liens on such Collateral in favor of the Collateral Agent for the
benefit of the Bank Creditors and the Other Creditors. It is understood
Exhibit H-1-A
Page 6
and agreed that the assignment, transfer, pledge and grant described in the
preceding sentence has been incorporated herein (out of an abundance of caution)
to ensure that this Agreement, which first provides for the Senior
[Subordinated] Secured Notes Obligations to be secured as provided herein on the
Second Restatement Effective Date, validly gives rise to the grant of a security
interest securing the Senior [Subordinated] Secured Notes Obligations.
(d) The security interest of the Collateral Agent under this Agreement
extends to all Collateral of the kind which is the subject of this Agreement
which any Assignor may acquire at any time during the continuation of this
Agreement.
1.2 Power of Attorney. Each Assignor hereby constitutes and appoints
the Collateral Agent its true and lawful attorney, irrevocably, with full power
after the occurrence of and during the continuance of an Event of Default (in
the name of such Assignor or otherwise) to act, require, demand, receive,
compound and give acquittance for any and all monies and claims for monies due
or to become due to such Assignor under or arising out of the Collateral, to
endorse any checks or other instruments or orders in connection therewith and to
file any claims or take any action or institute any proceedings which the
Collateral Agent may deem to be necessary or advisable to accomplish the
purposes of this Agreement, which appointment as attorney is coupled with an
interest.
ARTICLE II
GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS
Each Assignor represents, warrants and covenants, which
representations, warranties and covenants shall survive execution and delivery
of this Agreement, as follows:
2.1 Necessary Filings. (i) All filings, registrations and recordings
necessary or appropriate to create, preserve, protect and perfect the security
interest granted by such Assignor to the Collateral Agent for the benefit of the
Secured Creditors (excluding the Senior [Subordinated] Secured Notes Creditor in
the case of any assignment, transfer, pledge or grant of Excluded Senior
[Subordinated] Secured Notes Collateral by any Assignor) hereby in respect of
the Collateral have been accomplished or (x) in the case of Collateral for which
it is necessary to file a UCC-1 financing statement in order to perfect a
security interest in such Collateral, such filings will be accomplished within
10 days following the Original Effective Date (or to the extent such Collateral
is acquired after the Original Effective Date, within 10 days following the date
of the acquisition of such Collateral) and (y) in the case of Collateral for
which a certificate of title has been issued and for which it is necessary to
record a security interest upon such certificate of title in order to perfect a
security interest in such Collateral, such recordings will be accomplished
within 90 days following the Original Effective Date (or to the extent such
Collateral is acquired after the Original Effective Date, within 90 days
following the date of the acquisition of such Collateral) or such later date as
the Collateral Agent shall determine in its sole discretion, and (ii) the
security interest granted to the Collateral Agent pursuant to this Agreement in
and to the Collateral constitutes (or, in the case of Collateral subject to
clauses (x) and (y) above, upon compliance with such clauses, will constitute) a
perfected security interest therein prior to the rights of all other Persons
therein and subject to no other Liens (other than Permitted Liens) and is
entitled to all the rights, priorities and benefits afforded by the Uniform
Exhibit H-1-A
Page 7
Commercial Code or other relevant law as enacted in any relevant jurisdiction to
perfected security interests.
2.2 No Liens. Such Assignor is, and as to all Collateral acquired by it
from time to time after the Second Restatement Effective Date such Assignor will
be, the owner of all Collateral free from any Lien, security interest,
encumbrance or other right, title or interest of any Person (other than
Permitted Liens and Liens created under this Agreement) and such Assignor shall
defend the Collateral against all claims and demands of all Persons at any time
claiming the same or any interest therein adverse to the Collateral Agent.
2.3 Other Financing Statements. As of the Second Restatement Effective
Date, there is no financing statement evidencing a valid security interest
against [Holdings] [the U.S. Borrower](5) or any of its Subsidiaries (or similar
statement or instrument of registration under the law of any jurisdiction)
covering or purporting to cover any interest of any kind in the Collateral
(other than (x) those created under this Agreement, (y) as may be filed in
connection with Permitted Liens and (z) those with respect to which appropriate
termination statements executed by the secured lender thereunder have been
delivered or shall be delivered to the Collateral Agent pursuant to the terms of
the Secured Debt Agreements), and at all times prior to the Termination Date,
such Assignor will not execute or authorize to be filed in any public office any
financing statement (or similar statement or instrument of registration under
the law of any jurisdiction) or statements relating to the Collateral, except
financing statements filed or to be filed in respect of and covering the
security interests granted hereby by such Assignor or as permitted by the
Secured Debt Agreements.
2.4 Chief Executive Office; Records. As of the Second Restatement
Effective Date, the chief executive office of such Assignor is located at the
address or addresses indicated on Annex A hereto. Such Assignor will not move
its chief executive office except to such new location as such Assignor may
establish in accordance with the last sentence of this Section 2.4. The
originals of all documents evidencing all Receivables and Contract Rights and
Trade Secret Rights of such Assignor and the only original books of account and
records of such Assignor relating thereto are, and will continue to be, kept at
such chief executive office or at such new locations as such Assignor may
establish in accordance with the last sentence of this Section 2.4. All
Receivables and Contract Rights and Trade Secret Rights of such Assignor are,
and will continue to be, maintained at, and controlled and directed (including,
without limitation, for general accounting purposes) from, the office locations
described above or such new location established in accordance with the last
sentence of this Section 2.4. No Assignor shall establish new locations for such
offices until (i) it shall have given to the Collateral Agent not less than 30
days' prior written notice of its intention to do so, clearly describing such
new location and providing such other information in connection therewith as the
Collateral Agent may reasonably request, (ii) with respect to such new location,
it shall have taken all action, reasonably satisfactory to the Collateral Agent,
to maintain the security interest of the Collateral Agent in the
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(5) Where this bracketed text appears in this Agreement, the term "Holdings"
(rather than "U.S. Borrower") should be inserted unless the Exchange
Transaction to be consummated is not a Qualified Exchange Transaction.
Exhibit H-1-A
Page 8
Collateral intended to be granted hereby at all times fully perfected and in
full force and effect, (iii) at the request of the Collateral Agent, it shall
have furnished an opinion of counsel reasonably acceptable to the Collateral
Agent to the effect that all financing or continuation statements and amendments
or supplements thereto have been filed in the appropriate filing office or
offices, and (iv) the Collateral Agent shall have received evidence that all
other actions (including, without limitation, the payment of all filing fees and
taxes, if any, payable in connection with such filings) have been taken, in
order to perfect (and maintain the perfection and priority of) the security
interest granted hereby.
2.5 Location of Inventory and Equipment. All Inventory and Equipment
held on the Second Restatement Effective Date by each Assignor is located at one
of the locations shown on Part I of Annex B hereto or is in transit between such
locations. Each Assignor agrees that all Inventory and Equipment now held or
subsequently acquired by it shall be kept at (or shall be in transport to) any
one of the locations shown on Part I of Annex B hereto (or to a service location
in one of the states or provinces listed on Part I of Annex B hereto), or such
new location as such Assignor may establish in accordance with the last sentence
of this Section 2.5, except as permitted to be sold, transferred or exchanged in
accordance with the terms hereof and in the Secured Debt Agreements. Any
Assignor may establish a new location for Inventory and Equipment within any
state or province included in the addresses on Part I of Annex B, any state or
province set forth in Part II of Annex B or any state or province set forth in
Part III of Annex B; provided, that, (i) in the case of any new location set
forth in Part I or II of Annex B, it shall have given notice to the Collateral
Agent within 30 days after establishing such new location and providing such
other information in connection therewith as the Collateral Agent may reasonably
request, (ii) in the case of any new location set forth in Part III of Annex B,
it shall have given to the Collateral Agent not less than 30 days prior written
notice of its intention to establish such new location, clearly describing such
new location and providing such other information in connection therewith as the
Collateral Agent may reasonably request, (iii) with respect to such new
location, it shall take all action as the Collateral Agent may reasonably
request to maintain the security interest of the Collateral Agent in the
Collateral intended to be granted hereby at all times fully perfected and in
full force and effect, (iv) at the reasonable request of the Collateral Agent,
it shall have furnished an opinion of counsel reasonably acceptable to the
Collateral Agent to the effect that all financing or continuation statements and
amendments or supplements thereto have been filed in the appropriate filing
office or offices, and (v) the Collateral Agent shall have received evidence
that all other actions (including, without limitation, the payment of all filing
fees and taxes, if any, payable in connection with such filings) have been
taken, in order to perfect (and maintain the perfection and priority of) the
security interest granted hereby.
2.6 Recourse. This Agreement is made with full recourse to each
Assignor and pursuant to and upon all the warranties, representations, covenants
and agreements on the part of such Assignor contained herein and in the other
Secured Debt Agreements and otherwise in writing in connection herewith or
therewith.
2.7 Legal Names; Organizational Identification Number; Trade Names;
Change of Name; etc. The exact legal name of each Assignor, and the
organizational identification number (if any) of each Assignor, as of the Second
Restatement Effective Date is listed on Annex C hereto for such Assignor. No
Assignor has or operates in any jurisdiction under, or in the five years
preceding the Second Restatement Effective Date has had or has operated in any
Exhibit H-1-A
Page 9
jurisdiction under, any trade names, fictitious names or other names except its
legal name and such other trade or fictitious names as are listed on Annex C
hereto for such Assignor. No Assignor shall change its legal name,
organizational identification number (if any) or assume or operate in any
jurisdiction under any trade, fictitious or other name except its legal name,
organizational identification number and those trade names in each case listed
on Annex C hereto for such Assignor and those that may be established in
accordance with the immediately succeeding sentence of this Section 2.7. No
Assignor shall change its legal name or organizational identification number or
assume or operate in any jurisdiction under any new trade, fictitious or other
name until (i) it shall have given to the Collateral Agent not less than 30
days' prior written notice of its intention so to do, clearly describing such
new name and the jurisdictions in which such new name shall be used and
providing such other information in connection therewith as the Collateral Agent
may reasonably request, (ii) with respect to such new name and/or jurisdiction,
it shall have taken all action to maintain the security interest of the
Collateral Agent in the Collateral intended to be granted hereby at all times
fully perfected and in full force and effect and (iii) the Collateral Agent
shall have received evidence that all other actions (including, without
limitation, the payment of all filing fees and taxes, if any, payable in
connection with such filings) have been taken, in order to perfect (and maintain
the perfection and priority of) the security interest granted hereby. In
addition, to the extent that any Assignor does not have an organizational
identification number on the date hereof and later obtains one, such Assignor
shall promptly thereafter notify the Collateral Agent of such organizational
identification number and shall take all actions reasonably satisfactory to the
Collateral Agent to the extent necessary to maintain the security interest of
the Collateral Agent in the Collateral intended to be granted hereby fully
perfected and in full force and effect.
2.8 Jurisdiction and Type of Organization. The jurisdiction of
organization of each Assignor, and the type of organization of each Assignor, as
of the Second Restatement Effective Date is listed on Annex K hereto for such
Assignor. No Assignor shall change its jurisdiction of organization or its type
of organization until (i) it shall have given to the Collateral Agent not less
than 30 day's prior written notice of intention so to do, clearly describing
such new jurisdiction of organization and/or type of organization and providing
such other information in connection therewith as the Collateral Agent may
reasonably request and (ii) with respect to such new jurisdiction of
organization and/or type of organization, it shall have taken all actions
reasonably requested by the Collateral Agent to maintain the security interest
of the Collateral Agent in the Collateral intended to be granted hereby at all
times fully perfected and in full force and effect.
2.9 Collateral in the Possession of a Bailee. If any Inventory or other
Goods are at any time in the possession of a bailee, the respective Assignor
shall promptly notify the Collateral Agent thereof and, if requested by the
Collateral Agent, shall use its reasonable best efforts to promptly obtain an
acknowledgment from such bailee, in form and substance reasonably satisfactory
to the Collateral Agent, that the bailee holds such Collateral for the benefit
of the Collateral Agent and shall act upon the instructions of the Collateral
Agent, without the further consent of the respective Assignor. The Collateral
Agent agrees with the Assignors that the Collateral Agent shall not give any
such instructions unless an Event of Default has occurred and is continuing or
would occur after taking into account any action by the respective Assignor with
respect to any such bailee.
Exhibit H-1-A
Page 10
2.10 As-Extracted Collateral; Timber-to-be-Cut. On the Second
Restatement Effective Date, no Assignor owns, or expects to acquire, any
property which constitutes, or would constitute, As-Extracted Collateral or
Timber-to-be-Cut. If at any time after the Second Restatement Effective Date any
Assignor owns, acquires or obtains rights to any As-Extracted Collateral or
Timber-to-be-Cut, such Assignor shall furnish the Collateral Agent with prompt
written notice thereof (which notice shall describe in reasonable detail the
As-Extracted Collateral and/or Timber-to-be-Cut and the locations thereof) and
shall take all actions as may be deemed reasonably necessary or desirable by the
Collateral Agent to perfect the security interest of the Collateral Agent
therein.
ARTICLE III
SPECIAL PROVISIONS CONCERNING
RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS
3.1 Additional Representations and Warranties. As of the time when each
of its Receivables arises, each Assignor shall be deemed to have represented and
warranted that such Receivable, and all records, papers and documents relating
thereto (if any) are genuine and in all material respects what they purport to
be, and that all papers and documents (if any) relating thereto (i) will
represent the genuine legal, valid and binding (except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws generally affecting creditors' rights
and by equitable principles (regardless of whether enforcement is sought in
equity or law) obligation of the account debtor evidencing indebtedness unpaid
and owed by the respective account debtor arising out of the performance of
labor or services or the sale or lease and delivery of the inventory, materials,
equipment or merchandise listed therein, or both, (ii) will be the only original
writings evidencing and embodying such obligation of the account debtor named
therein (other than copies created for general accounting purposes), (iii) will
evidence true and valid obligations, enforceable in accordance with their
respective terms (except to the extent that the enforceability thereof may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws generally affecting creditors' rights and by equitable principles
(regardless of whether enforcement is sought in equity or law)) and (iv) will be
in compliance and will conform in all material respects with all applicable
federal, state and local laws and applicable laws of any relevant foreign
jurisdiction.
3.2 Maintenance of Records. Each Assignor will keep and maintain at its
own cost and expense satisfactory and complete records of its Receivables and
Contracts, including, but not limited to, originals or copies of all
documentation (including each Contract) with respect thereto, records of all
payments received, all credits granted thereon, all merchandise returned and all
other dealings therewith, and such Assignor will make the same available on such
Assignor's premises to the Collateral Agent for inspection, at such Assignor's
own cost and expense, at any and all reasonable times and intervals as the
Collateral Agent may request. Upon the occurrence and during the continuance of
an Event of Default and at the request of the Collateral Agent, such Assignor
shall, at its own cost and expense, deliver all tangible evidence of its
Receivables and Contract Rights (including, without limitation, all documents
evidencing the Receivables and all Contracts) and such books and records to the
Collateral Agent or to its
Exhibit H-1-A
Page 11
representatives (copies of which evidence and books and records may be retained
by such Assignor). Each Assignor shall legend, in form and manner satisfactory
to the Collateral Agent, all leases of Tractor Trailers to Program Affiliates,
as well as all documents of such Assignor evidencing or pertaining to such
leases, with an appropriate reference to the fact that such lease has been
assigned to the Collateral Agent and that the Collateral Agent has a security
interest therein. In addition, if the Collateral Agent so directs, such Assignor
shall legend, in form and manner satisfactory to the Collateral Agent, the
Receivables and all other Contracts, as well as books, records and documents of
such Assignor evidencing or pertaining to such Receivables or such other
Contracts with an appropriate reference to the fact that such Receivables and
Contracts have been assigned to the Collateral Agent and that the Collateral
Agent has a security interest therein.
3.3 Direction to Account Debtors; Contracting Parties; etc. Upon the
occurrence and during the continuance of an Event of Default, and if the
Collateral Agent so directs any Assignor, such Assignor agrees (x) to cause all
payments on account of the Receivables and Contracts to be made directly to the
Cash Collateral Account, (y) that the Collateral Agent may, at its option,
directly notify the obligors with respect to any Receivables and/or under any
Contracts to make payments with respect thereto as provided in preceding clause
(x), and (z) that the Collateral Agent may enforce collection of any such
Receivables and Contracts and may adjust, settle or compromise the amount of
payment thereof, in the same manner and to the same extent as such Assignor.
Upon the occurrence and during the continuance of an Event of Default, without
notice to or assent by any Assignor, the Collateral Agent may apply any or all
amounts then in, or thereafter deposited in, the Cash Collateral Account which
application shall be effected in the manner provided in Section 8.4 of this
Agreement. The costs and expenses (including attorneys' fees) of collection,
whether incurred by the Assignor or the Collateral Agent, shall be borne by the
relevant Assignor.
3.4 Modification of Terms; etc. No Assignor shall rescind or cancel any
indebtedness evidenced by any Receivable, or modify any term thereof or make any
adjustment with respect thereto, or extend or renew the same, or compromise or
settle any material dispute, claim, suit or legal proceeding relating thereto,
or sell any Receivable, or interest therein, without the prior written consent
of the Collateral Agent, except as permitted by Section 3.5. No Assignor shall
rescind or cancel any indebtedness evidenced by any Contract, or modify any term
thereof or make any adjustment with respect thereto, or extend or renew the
same, or compromise or settle any material dispute, claim, suit or legal
proceeding relating thereto, or sell any Contract, or interest therein, without
the prior written consent of the Collateral Agent, except (i) as permitted by
Section 3.5 and (ii) to the extent that the aggregate cost to [Holdings] [the
U.S. Borrower] and its Subsidiaries of any such recision, cancellation,
modification, adjustment, extension, compromise, settlement or sale is not
reasonably likely to have a Material Adverse Effect. Each Assignor will duly
fulfill all material obligations on its part to be fulfilled under or in
connection with the Receivables and Contracts and will do nothing to impair in
any material respect the rights of the Collateral Agent in the Receivables,
except as permitted by Section 3.5.
3.5 Collection. Each Assignor shall use reasonable efforts to endeavor
to cause to be collected from the account debtor named in each of its
Receivables or obligor under any Contract, as and when due (including, without
limitation, amounts, services or products which are delinquent, such amounts,
services or products to be collected in accordance with generally
Exhibit H-1-A
Page 12
accepted lawful collection procedures) any and all amounts, services or products
owing under or on account of such Receivable or Contract, and apply forthwith
upon receipt thereof all such amounts, services or products as are so collected
to the outstanding balance of such Receivable or under such Contract, except
that, prior to the occurrence of an Event of Default, any Assignor may allow in
the ordinary course of business as adjustments to amounts, services or products
owing under its Receivables and Contracts (i) an extension or renewal of the
time or times of payment or exchange, or settlement for less than the total
unpaid balance, which such Assignor finds appropriate in accordance with
reasonable business judgment and (ii) a refund or credit due as a result of
returned or damaged merchandise or improperly performed services. The costs and
expenses (including, without limitation, attorneys' fees) of collection, whether
incurred by an Assignor or the Collateral Agent, shall be borne by the relevant
Assignor.
3.6 Instruments. If any Assignor owns or acquires any Instrument
constituting Collateral, such Assignor will within 10 days notify the Collateral
Agent thereof, and upon request by the Collateral Agent will promptly deliver
such Instrument to the Collateral Agent appropriately endorsed to the order of
the Collateral Agent as further security hereunder.
3.7 Further Actions . Each Assignor will, at its own expense, make,
execute, endorse, acknowledge, file and/or deliver to the Collateral Agent from
time to time such vouchers, invoices, schedules, confirmatory assignments,
conveyances, financing statements, transfer endorsements, powers of attorney,
certificates, reports and other assurances or instruments and take such further
steps, including any and all actions as may be necessary or required under the
Federal Assignment of Claims Act, relating to its Receivables, Contracts,
Instruments and other property or rights covered by the security interest hereby
granted, as the Collateral Agent may reasonably request to preserve and protect
its security interest in the Collateral.
3.8 Assignors Remain Liable Under Receivables and Contracts. Anything
herein to the contrary notwithstanding, the Assignors shall remain liable under
each of the Receivables and each Contract to observe and perform all of the
conditions and obligations to be observed and performed by them thereunder, all
in accordance with the terms of the agreement giving rise to such Receivables or
such Contract. Neither the Collateral Agent nor any other Secured Creditor shall
have any obligation or liability under any Receivable (or any agreement giving
rise thereto) or any Contract by reason of or arising out of this Agreement or
the receipt by the Collateral Agent or any other Secured Creditor of any payment
relating to such Receivable or such Contract pursuant hereto, nor shall the
Collateral Agent or any other Secured Creditor be obligated in any manner to
perform any of the obligations of any Assignor under or pursuant to any
Receivable (or any agreement giving rise thereto) or any Contract, to make any
payment, to make any inquiry as to the nature or the sufficiency of any payment
received by them or as to the sufficiency of any performance by any party under
any Receivable (or any agreement giving rise thereto) or any Contract, to
present or file any claim, to take any action to enforce any performance or to
collect the payment of any amounts which may have been assigned to them or to
which they may be entitled at any time or times.
3.9 Deposit Accounts; Etc. (a) No Assignor maintains, or at any time
after the Second Restatement Effective Date shall establish or maintain, any
demand, time, savings, passbook or similar account, except for such accounts
maintained with a bank (as defined in
Exhibit H-1-A
Page 13
Section 9-102 of the UCC) whose jurisdiction (determined in accordance with
Section 9-304 of the UCC) is within a State of the United States. Annex M hereto
accurately sets forth, as of the date of this Agreement, for each Assignor, each
Deposit Account maintained by such Assignor (including a description thereof and
the respective account number), the name of the respective bank with which such
Deposit Account is maintained, and the jurisdiction of the respective Bank with
respect to such Deposit Account. For each Deposit Account (other than (i) the
Cash Collateral Account or any other Deposit Account maintained with the
Collateral Agent, (ii) Deposit Accounts with an aggregate monthly balance of
less than $10,000, provided that, with respect to this clause (ii) only, the
aggregate amount in all such Deposit Accounts excluded pursuant to this clause
(ii) does not exceed $200,000 at any time, (iii) payroll accounts and (iv) such
other accounts used solely for disbursement purposes), the respective Assignor
shall cause the bank with which the Deposit Account is maintained to execute and
deliver to the Collateral Agent, within 60 days after the Second Restatement
Effective Date or, if later, at the time of the establishment of the respective
Deposit Account, a "control agreement" in the form of Annex O hereto
(appropriately completed), with such changes thereto as may be acceptable to the
Collateral Agent. If any bank with which a Deposit Account is maintained refuses
to, or does not, enter into such a "control agreement", then the respective
Assignor shall promptly (and in any event within 60 days after the date of this
Agreement or, if later, 30 days after the opening of such account) close the
respective Deposit Account and transfer all balances therein to the Cash
Collateral Account or another Deposit Account meeting the requirements of this
Section 3.9. If any bank with which a Deposit Account is maintained refuses to
subordinate all its claims with respect to such Deposit Account to the
Collateral Agent's security interest therein on terms satisfactory to the
Collateral Agent, then the Collateral Agent, at its option, may (x) require that
such Deposit Account be terminated in accordance with the immediately preceding
sentence or (y) agree to a "control agreement" without such subordination,
provided that in such event the Collateral Agent may at any time, at its option,
subsequently require that such Deposit Account be terminated (within 30 days
after notice from the Collateral Agent) in accordance with the requirements of
the immediately preceding sentence.
(b) After the Second Restatement Effective Date, no Assignor shall
establish any new demand, time, savings, passbook or similar account, except for
Deposit Accounts established and maintained with banks and meeting the
requirements of preceding clause (a). At the time any such Deposit Account is
established, the appropriate "control agreement" shall be entered into in
accordance with the requirements of preceding clause (a) and the respective
Assignor shall furnish to the Collateral Agent a supplement to Annex M hereto
containing the relevant information with respect to the respective Deposit
Account and the bank with which same is established.
3.10 Letter-of-Credit Rights. If any Assignor is at any time a
beneficiary under a letter of credit with a stated amount of $1,000,000 or more,
such Assignor shall promptly notify the Collateral Agent thereof and, at the
request of the Collateral Agent, such Assignor shall, pursuant to an agreement
in form and substance reasonably satisfactory to the Collateral Agent, use its
reasonable best efforts to (i) arrange for the issuer and any confirmer of such
letter of credit to consent to an assignment to the Collateral Agent of the
proceeds of any drawing under such letter of credit or (ii) arrange for the
Collateral Agent to become the transferee beneficiary of such letter of credit,
with the Collateral Agent agreeing, in each case, that the proceeds of any
Exhibit H-1-A
Page 14
drawing under the letter of credit are to be applied as provided in this
Agreement after the occurrence and during the continuance of an Event of
Default.
3.11 Commercial Tort Claims. All Commercial Tort Claims of each
Assignor and any events or circumstances that would reasonably be expected to
give rise to any Commercial Tort Claims of each Assignor as of the date of this
Agreement are described in Annex N hereto. If any Assignor shall at any time and
from time to time after the Second Restatement Effective Date become aware of
any Commercial Tort Claims or events or circumstances that would reasonably be
expected to give rise to a Commercial Tort Claim of such Assignor, in an amount
(taking the greater of the aggregate claimed damages thereunder or the
reasonably estimated value thereof) of $1,000,000 or more, such Assignor shall
(i) promptly notify the Collateral Agent thereof in a writing signed by such
Assignor and describing the details thereof and shall grant to the Collateral
Agent in such writing a security interest in all such Commercial Tort Claims and
in the proceeds thereof, all upon the terms of this Agreement, with such writing
to be in form and substance reasonably satisfactory to the Collateral Agent and
(ii) perform all actions reasonably requested by the Collateral Agent to perfect
such security interest in such Commercial Tort Claims.
3.12 Chattel Paper. Upon the request of the Collateral Agent made at
any time or from time to time, each Assignor shall promptly furnish to the
Collateral Agent a list of all Electronic Chattel Paper held or owned by such
Assignor. Furthermore, if requested by the Collateral Agent, each Assignor shall
promptly take all actions which are reasonably practicable so that the
Collateral Agent has "control" of all Electronic Chattel Paper in accordance
with the requirements of Section 9-105 of the UCC. Each Assignor will promptly
(and in any event within 10 days) following any request by the Collateral Agent,
deliver all of its Tangible Chattel Paper to the Collateral Agent.
ARTICLE IV
SPECIAL PROVISIONS CONCERNING TRADEMARKS
4.1 Additional Representations and Warranties. Each Assignor represents
and warrants that it is the true, lawful, sole and exclusive owner of or
otherwise has the right to use the Marks listed in Annex D hereto and that said
listed Marks constitute all the Marks that such Assignor presently owns or uses
in connection with its business and include all the United States federal
registrations or applications registered in the United States Patent and
Trademark Office. Each Assignor represents and warrants that it owns or
otherwise has the right to use all Marks that it uses. Each Assignor further
warrants that it has no knowledge as of the Second Restatement Effective Date,
of any material third party claim that any aspect of such Assignor's present or
contemplated business operations infringes or will infringe any rights in any
trademark, service mark or trade name. Each Assignor represents and warrants
that it is the beneficial and record owner of all trademark registrations and
applications listed in Annex D hereto and that said registrations are valid,
subsisting and have not been canceled and that such Assignor is not aware of any
material third party claim that any of said registrations is invalid or
unenforceable, or that there is any reason that any of said applications will
not pass to registration. Each Assignor represents and warrants that upon the
recordation of an Assignment of Security Interest in United States Trademarks
and Patents in the form of Annex G hereto in
Exhibit H-1-A
Page 15
the United States Patent and Trademark Office, together with filings on Form
UCC-1 pursuant to this Agreement, all filings, registrations and recordings
necessary or appropriate to perfect the security interest granted to the
Collateral Agent in the United States Marks covered by this Agreement under
federal law will have been accomplished. Each Assignor agrees to execute such an
Assignment of Security Interest in United States Trademark and Patents covering
all right, title and interest in each United States Mark, and the associated
goodwill, of such Assignor, and to record the same. Each Assignor hereby grants
to the Collateral Agent an absolute power of attorney to sign, upon the
occurrence and during the continuance of an Event of Default, any document which
may be required by the U.S. Patent and Trademark Office or secretary of state or
equivalent governmental agency of any State of the United States or any foreign
jurisdiction in order to effect an absolute assignment of all right, title and
interest in each Mark, and record the same.
4.2 Licenses and Assignments. Each Assignor hereby agrees not to divest
itself of any right under any Mark that is material to the business of such
Assignor absent prior written approval of the Collateral Agent, except as
otherwise permitted by this Agreement or the Credit Agreement.
4.3 Infringements. Each Assignor agrees, promptly upon learning
thereof, to notify the Collateral Agent in writing of the name and address of,
and to furnish such pertinent information that may be available with respect to,
(i) any party who such Assignor believes is infringing or diluting or otherwise
violating in any material respect any of such Assignor's rights in and to any
Mark, or (ii) with respect to any party claiming that such Assignor's use of any
Mark violates in any material respect any property right of that party. Each
Assignor further agrees, unless otherwise agreed by the Collateral Agent, to
prosecute, in accordance with reasonable business practices, any Person
infringing any Mark.
4.4 Preservation of Marks. Each Assignor agrees to use its Marks in
interstate or foreign commerce, as the case may be, during the time in which
this Agreement is in effect, sufficiently to preserve such Marks as valid and
subsisting trademarks or service marks under the laws of the United States or
the relevant foreign jurisdiction; provided that no Assignor shall be obligated
to preserve any Mark to the extent the Assignor determines, in its reasonable
business judgment, that the preservation of such Mark is no longer desirable in
the conduct of its business.
4.5 Maintenance of Registration. Each Assignor shall, at its own
expense and in accordance with reasonable business practices, process all
documents required by the Trademark Act of 1946, as amended, 15 U.S.C. ss.ss.
1051 et seq. to maintain trademark registrations, including but not limited to
affidavits of continued use and applications for renewals of registration in the
United States Patent and Trademark Office for all of its registered Marks
pursuant to 15 U.S.C. ss.ss. 1058, 1059 and 1065 and any foreign equivalent
thereof, and shall pay all fees and disbursements in connection therewith and
shall not abandon any such filing of affidavit of use or any such application of
renewal prior to the exhaustion of all administrative and judicial remedies
without prior written consent of the Collateral Agent; provided that no Assignor
shall be obligated to preserve any Mark to the extent such Assignor determines,
in its reasonable business judgment, that the preservation of such Mark is no
longer desirable in the conduct of its business.
Exhibit H-1-A
Page 16
4.6 Future Registered Marks. If any registration for any Mark that is
material to its business issues hereafter to any Assignor as a result of any
application now or hereafter pending before the United States Patent and
Trademark Office, within 30 days of receipt of such certificate, such Assignor
shall deliver to the Collateral Agent a copy of such certificate, and an
assignment for security in such Mark, to the Collateral Agent and at the expense
of such Assignor, confirming the assignment for security in such Mark to the
Collateral Agent hereunder, the form of such security to be substantially the
same as the form hereof or in such other form as may be reasonably satisfactory
to the Collateral Agent.
4.7. Remedies. If an Event of Default shall occur and be continuing,
the Collateral Agent may, by written notice to the relevant Assignor, take any
or all of the following actions: (i) declare the entire right, title and
interest of such Assignor in and to each of the Marks, together with all
trademark rights and rights of protection to the same and the goodwill of such
Assignor's business symbolized by said Marks and the right to recover for past
infringements thereof, vested in the Collateral Agent for the benefit of the
Secured Creditors (excluding the Senior [Subordinated] Secured Notes Creditor,
in the case of Marks and rights therein owned or held by any Assignor which
constitute Excluded Senior [Subordinated] Secured Notes Collateral), in which
event such rights, title and interest shall immediately vest, in the Collateral
Agent for the benefit of the relevant Secured Creditors, and the Collateral
Agent shall be entitled to exercise the power of attorney referred to in Section
4.1 to execute, cause to be acknowledged and notarized and to record said
absolute assignment with the applicable agency; (ii) take and use or sell the
Marks and the goodwill of such Assignor's business symbolized by the Marks and
the right to carry on the business and use the assets of such Assignor in
connection with which the Marks have been used; and (iii) direct such Assignor
to refrain, in which event such Assignor shall refrain, from using the Marks in
any manner whatsoever, directly or indirectly, and, if requested by the
Collateral Agent, change such Assignor's corporate name to eliminate therefrom
any use of any Mark and execute such other and further documents that the
Collateral Agent may request to further confirm this and to transfer ownership
of the Marks and registrations and any pending trademark applications therefor
in the United States Patent and Trademark Office or any equivalent government
agency or office in any foreign jurisdiction to the Collateral Agent.
ARTICLE V
SPECIAL PROVISIONS CONCERNING
PATENTS, COPYRIGHTS AND TRADE SECRETS
5.1 Additional Representations and Warranties. Each Assignor represents
and warrants that it is the true and lawful exclusive owner of or otherwise has
the right to use all rights in (i) all trade secrets and proprietary information
necessary to operate the business of such Assignor (the "Trade Secret Rights"),
(ii) the Patents listed in Annex E hereto and (iii) the Copyrights listed in
Annex F hereto, that said Patents constitute all the patents and applications
for patents that such Assignor now owns and that are necessary in the conduct of
the business of such Assignor and that such Copyrights constitute all
registrations of copyrights and applications for copyright registrations that
the Assignor now owns and that are necessary in the conduct of the business of
such Assignor. Each Assignor further represents and warrants that it has the
Exhibit H-1-A
Page 17
exclusive right to use and practice under all Patents and Copyrights that it
owns and has the exclusive right to exclude others from using or practicing
under any Patents it owns. Each Assignor further warrants that, as of the Second
Restatement Effective Date it has no knowledge of any material third party claim
that any aspect of such Assignor's present or contemplated business operations
infringes or will infringe any rights in any patent or copyright or such
Assignor has misappropriated any trade secret or proprietary information. Each
Assignor represents and warrants that upon the recordation of an Assignment of
Security Interest in United States Trademarks and Patents in the form of Annex G
hereto in the United States Patent and Trademark Office and the recordation of
an Assignment of Security Interest in United States Copyrights in the form of
Annex H hereto in the United States Copyright Office, together with filings on
Form UCC-1 pursuant to this Agreement, all filings, registrations and recordings
necessary or appropriate to perfect the security interest granted to the
Collateral Agent in the United States Patents and United States Copyrights
covered by this Agreement under federal law will have been accomplished. Upon
obtaining any Patent, each Assignor agrees to execute an Assignment of Security
Interest in United States Trademarks and Patents covering all right, title and
interest in each United States Patent of such Assignor and to record the same,
and upon obtaining any Copyright, to execute such an Assignment of Security
Interest in United States Copyrights covering all right, title and interest in
each United States Copyright of such Assignor and to record the same. Each
Assignor hereby grants to the Collateral Agent an absolute power of attorney to
sign, upon the occurrence and during the continuance of any Event of Default,
any document which may be required by the U.S. Patent and Trademark Office or
equivalent governmental agency in any foreign jurisdiction or the U.S. Copyright
Office or equivalent governmental agency in any foreign jurisdiction in order to
effect an absolute assignment of all right, title and interest in each Patent
and Copyright, and to record the same.
5.2 Licenses and Assignments. Each Assignor hereby agrees not to divest
itself of any right under any Patent or Copyright that is material to the
business of such Assignor absent prior written approval of the Collateral Agent,
except as otherwise permitted by this Agreement or the Credit Agreement.
5.3 Infringements. Each Assignor agrees, promptly upon learning
thereof, to furnish the Collateral Agent in writing with all pertinent
information available to such Assignor with respect to infringement,
contributing infringement or active inducement to infringe in any Patent or
Copyright or to any claim that the practice of any Patent or the use of any
Copyright violates any property right of a third party, or with respect to any
misappropriation of any Trade Secret Right or any claim that the practice of any
Trade Secret Right violates any property right of a third party. Each Assignor
further agrees, absent direction of the Collateral Agent to the contrary, to
prosecute, in accordance with reasonable business practices, any Person
infringing any Patent or Copyright or any Person misappropriating any Trade
Secret Right.
5.4 Maintenance of Patents and Copyrights. At its own expense, each
Assignor shall make timely payment of all post-issuance fees required pursuant
to 35 U.S.C. ss. 41 and any foreign equivalent thereof to maintain in force
rights under each Patent, and to apply as permitted pursuant to applicable law
for any renewal of each Copyright absent prior written consent of the Collateral
Agent; provided, that, no Assignor shall be obligated to pay any such fees or
apply for any such renewal to the extent that such Assignor determines, in its
reasonable business
Exhibit H-1-A
Page 18
judgment, that the preservation of such Patent or Copyright is no longer
desirable in the conduct of its business.
5.5 Prosecution of Patent or Copyright Application. At its own expense,
each Assignor shall prosecute, in accordance with reasonable business practices,
all applications for Patents listed in Annex E hereto and for Copyrights listed
in Annex F hereto and shall not abandon any such application prior to exhaustion
of all administrative and judicial remedies, absent written consent of the
Collateral Agent.
5.6 Other Patents and Copyrights. Within 30 days of the acquisition or
issuance of a Patent or of a Copyright registration, or of filing of an
application for a Patent or Copyright registration, that is in each case
material to its business, the relevant Assignor shall deliver to the Collateral
Agent a copy of said Copyright registration or Patent or certificate or
registration of, or application therefor, as the case may be, with an assignment
for security as to such Patent or Copyright, as the case may be, to the
Collateral Agent and at the expense of such Assignor, confirming the assignment
for security, the form of such assignment for security to be substantially the
same as the form hereof or in such other form as may be satisfactory to the
Collateral Agent.
5.7 Remedies. If an Event of Default shall occur and be continuing, the
Collateral Agent may by written notice to the relevant Assignor, take any or all
of the following actions: (i) declare the entire right, title, and interest of
such Assignor in each of the Patents and Copyrights vested in the Collateral
Agent for the benefit of the Secured Creditors (excluding the Senior
[Subordinated] Secured Notes Creditor, in the case of Patents and Copyrights and
rights therein owned or held by any Assignor which constitute Excluded Senior
[Subordinated] Secured Notes Collateral), in which event such right, title, and
interest shall immediately vest in the Collateral Agent for the benefit of the
relevant Secured Creditors, in which case the Collateral Agent shall be entitled
to exercise the power of attorney referred to in Section 5.1 to execute, cause
to be acknowledged and notarized and to record said absolute assignment with the
applicable agency; (ii) take and practice or sell the Patents, Copyrights and
Trade Secret Rights; and (iii) direct such Assignor to refrain, in which event
such Assignor shall refrain, from practicing the Patents and using the
Copyrights and/or Trade Secret Rights directly or indirectly, and such Assignor
shall execute such other and further documents as the Collateral Agent may
request further to confirm this and to transfer ownership of the Patents,
Copyrights and Trade Secret Rights to the Collateral Agent for the benefit of
the Secured Creditors (excluding the Senior [Subordinated] Secured Notes
Creditor, in the case of Patents and Copyrights and rights therein owned or held
by any Assignor which constitute Excluded Senior [Subordinated] Secured Notes
Collateral).
ARTICLE VI
SPECIAL PROVISIONS CONCERNING TRACTOR TRAILERS
6.1 Additional Representations and Warranties. Each Assignor represents and
warrants that it is the true, lawful, sole and exclusive owner of or otherwise
has the right to use the Tractor Trailers of such Assignor listed in Part A of
Annex I hereto and that said listed Tractor Trailers constitute all the Tractor
Trailers that such Assignor presently owns or uses in
Exhibit H-1-A
Page 19
connection with its business. Each Assignor represents and warrants that it is
the true, lawful, sole and exclusive owner of the Tractor Trailers of such
Assignor listed on Parts B and C of Annex I hereto and that said listed Tractor
Trailers constitute all the Tractor Trailers that such Assignor owns in
connection with its business as of the Second Restatement Effective Date. Each
Assignor represents and warrants that upon the recordation of a security
interest in favor of the Collateral Agent on the certificate of title for each
Tractor Trailer listed on Parts B and C of Annex I and the filing of such
certificates of title in the state or province specified for such Tractor
Trailer on Parts B or C, as the case may be, of Annex I (which recordations have
been made if this representation and warranty is being made (x) in the case of a
recordation of a certificate of title for a Tractor Trailer listed on Part B of
Annex I, on or prior to the Second Restatement Effective Date and (y) in the
case of a recordation of a certificate of the title for a Tractor Trailer listed
on Part C of Annex I, on or after the 90th day following the Second Restatement
Effective Date), all filings, registrations and recordings necessary or
appropriate to perfect the security interest granted to the Collateral Agent for
the benefit of the Secured Creditors (excluding the Senior [Subordinated]
Secured Notes Creditor, in the case of Tractor Trailers and rights therein owned
or held by any Assignor which constitute Excluded Senior [Subordinated] Secured
Notes Collateral) in the Tractor Trailers listed on Part B of Annex I and
covered by this Agreement will have been accomplished, and such security
interests shall be perfected under applicable law. Each Assignor agrees to
execute all documentation reasonably required to effect such recordations and to
cause the filing of the relevant certificates of title with the appropriate
state or provincial governmental agency. Each Assignor hereby grants to the
Collateral Agent an absolute power of attorney to sign, upon the occurrence and
during the continuance of an Event of Default, any document which may be
required by the relevant governmental agency of any state or province in order
to effect an absolute assignment of all right, title and interest in each
Tractor Trailer, and register the same.
6.2 Maintenance of Registration. Each Assignor shall, at its own
expense and in accordance with reasonable business practices, process all
documents required by the relevant state and provincial governmental agencies to
maintain vehicle registrations, for all of its owned Tractor Trailers.
6.3 Subsequently Acquired Tractor Trailers. Within 90 days following
the acquisition of any Tractor Trailer (or such later date as the Collateral
Agent shall determine in its sole discretion), the relevant Assignor shall, at
its own expense, cause a security interest in favor of the Collateral Agent to
be recorded on the certificate of title for such Tractor Trailer and cause each
such certificate of title to be filed in the relevant state or province in which
such Tractor Trailer is registered. Each Assignor agrees to execute all
documentation reasonably required to effect such recordations and to cause the
filing of relevant certificates of title with the appropriate state or
provincial governmental agency.
6.4 Remedies. If an Event of Default shall occur and be continuing, the
Collateral Agent may, by written notice to the relevant Assignor, take any or
all of the following actions: (i) declare the entire right, title and interest
of such Assignor in and to each of the Tractor Trailers, vested in the
Collateral Agent for the benefit of the Secured Creditors, in which event such
rights, title and interest shall immediately vest, in the Collateral Agent for
the benefit of the Secured Creditors, and the Collateral Agent shall be entitled
to exercise the power of attorney referred to in Section 6.1 to execute, cause
to be acknowledged and notarized and to
Exhibit H-1-A
Page 20
record said absolute assignment with the applicable agency; (ii) take and use or
sell the Tractor Trailers; and (iii) request such Assignor to (whereupon such
Assignor shall) deliver all of the certificates of title for each Tractor
Trailer owned by such Assignor to the Collateral Agent.
6.5 Further Assurances. Each Assignor will, at its own expense, make,
execute, endorse, acknowledge, file and/or deliver to the Collateral Agent from
time to time such lists, descriptions and designations of its owned Tractor
Trailers, documents of title, schedules, confirmatory assignments, conveyances,
financing statements, transfer endorsements, powers of attorney, certificates,
reports and other assurances or instruments and take such further steps relating
to the Tractor Trailers constituting Collateral and other property or rights
covered by the security interest hereby granted, which the Collateral Agent
deems reasonably appropriate or advisable to perfect, preserve or protect its
security interest in the Tractor Trailers constituting Collateral.
ARTICLE VII
PROVISIONS CONCERNING ALL COLLATERAL
7.1 Protection of Collateral Agent's Security. Each Assignor will do
nothing to impair the rights of the Collateral Agent in the Collateral. Each
Assignor will at all times keep its Inventory and Equipment insured in favor of
the Collateral Agent, at such Assignor's own expense to the extent and in the
manner provided in the Secured Debt Agreements; all policies or certificates
with respect to such insurance (and any other insurance maintained by such
Assignor); (i) shall be endorsed to the Collateral Agent's satisfaction for the
benefit of the Collateral Agent (including, without limitation, by naming the
Collateral Agent as loss payee and naming each of the the Collateral Agent and
the other Secured Creditors as additional insureds); (ii) shall state that such
insurance policies shall not be cancelled or revised without 30 days' prior
written notice thereof by the insurer to the Collateral Agent; and (iii)
certified copies of such policies or certificates shall be deposited with the
Collateral Agent to the extent, at the times and in the manner specified in the
Credit Agreement. If any Assignor shall fail to insure its Inventory and
Equipment in accordance with the preceding sentence, or if any Assignor shall
fail to so endorse and deposit all policies or certificates with respect
thereto, the Collateral Agent shall have the right (but shall be under no
obligation) to procure such insurance and such Assignor agrees to promptly
reimburse the Collateral Agent for all costs and expenses of procuring such
insurance. Except as otherwise permitted to be retained or expended by the
relevant Assignor pursuant to the Credit Agreement (or, after the Credit
Document Obligations Termination Date, any other Secured Debt Agreement), the
Collateral Agent shall, upon receipt of any proceeds from insurance maintained
by any Assignor, apply such proceeds in accordance with the Credit Agreement
(or, after the Credit Document Obligations Termination Date, in accordance with
the instructions of the Required Secured Creditors), or after the Obligations
have been accelerated or otherwise become due and payable, with Section 8.4.
Each Assignor assumes all liability and responsibility in connection with the
Collateral acquired by it and the liability of such Assignor to pay the
Obligations shall in no way be affected or diminished by reason of the fact that
such Collateral may be lost, destroyed, stolen, damaged or for any reason
whatsoever unavailable to such Assignor.
Exhibit H-1-A
Page 21
7.2 Warehouse Receipts Non-Negotiable. Each Assignor agrees that if any
warehouse receipt or receipt in the nature of a warehouse receipt is issued with
respect to any of its Inventory, such warehouse receipt or receipt in the nature
thereof shall not be "negotiable" (as such term is used in Section 7-104 of the
Uniform Commercial Code as in effect in any relevant jurisdiction or under other
relevant law).
7.3 Further Actions. Each Assignor will, at its own expense, make,
execute, endorse, acknowledge, file and/or deliver to the Collateral Agent from
time to time such lists, descriptions and designations of its Collateral,
warehouse receipts, receipts in the nature of warehouse receipts, bills of
lading, documents of title, vouchers, invoices, schedules, confirmatory
assignments, conveyances, financing statements, transfer endorsements, powers of
attorney, certificates, reports and other assurances or instruments and take
such further steps relating to the Collateral and other property or rights
covered by the security interest hereby granted, which the Collateral Agent
deems reasonably appropriate or advisable to perfect, preserve or protect its
security interest in the Collateral.
7.4 Financing Statements. Each Assignor agrees to execute and deliver
to the Collateral Agent such financing statements, in form acceptable to the
Collateral Agent, as the Collateral Agent may from time to time reasonably
request or as are reasonably necessary or desirable in the opinion of the
Collateral Agent to establish and maintain a valid, enforceable, first priority
perfected security interest in the Collateral as provided herein and the other
rights and security contemplated hereby all in accordance with the Uniform
Commercial Code as enacted in any and all relevant jurisdictions or any other
relevant law. Each Assignor will pay any applicable filing fees, recordation
taxes and related expenses relating to its Collateral. Each Assignor hereby
authorizes the Collateral Agent to file any such financing statements
(including, without limitation (x) financing statements which list the
Collateral specifically and/or "all assets" as collateral and (y) "in lieu of"
financing statements) without the signature of such Assignor where permitted by
law, and so long as no Default or Event of Default is in existence, the
Collateral Agent shall give notice to such Assignor of any such filing.
7.5 Additional Information. Each Assignor will, at its own expense,
from time to time upon the reasonable request of the Collateral Agent, promptly
(and in any event within 10 days after its receipt of the respective request)
furnish to the Collateral Agent such information with respect to the Collateral
(including the identity of the Collateral or such components thereof as may have
been requested by the Collateral Agent, the value and location of such
Collateral, etc.) as may be requested by the Collateral Agent. Without limiting
the forgoing, each Assignor agrees that it shall promptly (and in any event
within 10 days after its receipt of the respective request) furnish to the
Collateral Agent such updated Annexes hereto as may from time to time be
reasonably requested by the Collateral Agent.
ARTICLE VIII
REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT
8.1 Remedies; Obtaining the Collateral Upon Default. Each Assignor
agrees that, if any Event of Default shall have occurred and be continuing, then
and in every such case, the Collateral Agent, in addition to any rights now or
hereafter existing under applicable law and
Exhibit H-1-A
Page 22
under the other provisions of this Agreement, shall have all rights as a secured
creditor under the Uniform Commercial Code in all relevant jurisdictions and
such additional rights and remedies to which a secured creditor is entitled
under the laws in effect in all relevant jurisdictions and may also:
(i) personally, or by agents or attorneys, immediately take
possession of the Collateral or any part thereof, from such Assignor or
any other Person who then has possession of any part thereof with or
without notice or process of law, and for that purpose may enter upon
such Assignor's premises where any of the Collateral is located and
remove the same and use in connection with such removal any and all
services, supplies, aids and other facilities of such Assignor;
(ii) instruct the obligor or obligors on any agreement,
instrument or other obligation (including, without limitation, the
Receivables and the Contracts) constituting the Collateral to make any
payment required by the terms of such agreement, instrument or other
obligation directly to the Collateral Agent and may exercise any and
all remedies of such Assignor in respect of such Collateral;
(iii) instruct all banks which have entered into a control
agreement with the Collateral Agent to transfer all monies, securities
and instruments held by such depository bank to the Cash Collateral
Account and withdraw all monies, securities and instruments in the Cash
Collateral Account for application to the Obligations in accordance
with Section 8.4;
(iv) sell, assign or otherwise liquidate any or all of the
Collateral or any part thereof in accordance with Section 8.2, or
direct the relevant Assignor to sell, assign or otherwise liquidate any
or all of the Collateral or any part thereof, and, in each case, take
possession of the proceeds of any such sale or liquidation;
(v) take possession of the Collateral or any part thereof, by
directing the relevant Assignor in writing to deliver the same to the
Collateral Agent at any place or places designated by the Collateral
Agent, in which event such Assignor shall at its own expense:
(x) forthwith cause the same to be moved to the place
or places so designated by the Collateral Agent and there
delivered to the Collateral Agent;
(y) store and keep any Collateral so delivered to the
Collateral Agent at such place or places pending further
action by the Collateral Agent as provided in Section 8.2; and
(z) while the Collateral shall be so stored and kept,
provide such guards, other security and maintenance services
as shall be necessary to protect the same and to preserve and
maintain them in good condition;
(vi) license or sublicense, whether on an exclusive or
nonexclusive basis, any Marks, Patents or Copyrights included in the
Collateral for such term and on
Exhibit H-1-A
Page 23
such conditions and in such manner as the Collateral Agent shall in its
sole judgment determine;
(vii) apply any monies constituting Collateral or proceeds
thereof in accordance with Section 8.4; and
(viii) take any other action as specified in clauses (1)
through (5), inclusive, of Section 9-607 of the UCC.
it being understood that each Assignor's obligation so to deliver the Collateral
is of the essence of this Agreement and that, accordingly, upon application to a
court of equity having jurisdiction, the Collateral Agent shall be entitled to a
decree requiring specific performance by such Assignor of said obligation. By
accepting the benefits of this Agreement and each other Security Document, the
Secured Creditors expressly acknowledge and agree that this Agreement and each
other Security Document may be enforced only by the action of the Collateral
Agent acting upon the instructions of the Required Secured Creditors and that no
other Secured Creditor shall have any right individually to seek to enforce this
Agreement or any other Security Document or to realize upon the security to be
granted hereby or thereby, it being understood and agreed that such rights and
remedies shall be exercised exclusively by the Collateral Agent for the benefit
of the Secured Creditors upon the terms of this Agreement and the other Security
Documents.
8.2 Remedies; Disposition of the Collateral. Any Collateral repossessed
by the Collateral Agent under or pursuant to Section 8.1 and any other
Collateral whether or not so repossessed by the Collateral Agent, may be sold,
assigned, leased or otherwise disposed of under one or more contracts or as an
entirety, and without the necessity of gathering at the place of sale the
property to be sold, and in general in such manner, at such time or times, at
such place or places and on such terms as the Collateral Agent may, in
compliance with any mandatory requirements of applicable law, determine to be
commercially reasonable. Any of the Collateral may be sold, leased or otherwise
disposed of, in the condition in which the same existed when taken by the
Collateral Agent or after any overhaul or repair at the expense of the relevant
Assignor which the Collateral Agent shall determine to be commercially
reasonable. Any such disposition which shall be a private sale or other private
proceedings permitted by such requirements shall be made upon not less than 10
days' written notice to the relevant Assignor specifying the time at which such
disposition is to be made and the intended sale price or other consideration
therefor, and shall be subject, for the 10 days after the giving of such notice,
to the right of the relevant Assignor or any nominee of such Assignor to acquire
the Collateral involved at a price or for such other consideration at least
equal to the intended sale price or other consideration so specified. Any such
disposition which shall be a public sale permitted by such requirements shall be
made upon not less than 10 days' written notice to the relevant Assignor
specifying the time and place of such sale and, in the absence of applicable
requirements of law, shall be by public auction (which may, at the Collateral
Agent's option, be subject to reserve), after publication of notice of such
auction not less than 10 days prior thereto in two newspapers in general
circulation to be selected by the Collateral Agent. To the extent permitted by
any such requirement of law, the Collateral Agent may bid for and become the
purchaser of the Collateral or any item thereof, offered for sale in accordance
with this Section without accountability to the relevant Assignor. If, under
mandatory requirements of applicable law, the Collateral Agent shall be required
to make disposition of the Collateral within a period of time which does not
Exhibit H-1-A
Page 24
permit the giving of notice to the relevant Assignor as hereinabove specified,
the Collateral Agent need give such Assignor only such notice of disposition as
shall be reasonably practicable in view of such mandatory requirements of
applicable law. Each Assignor agrees to do or cause to be done all such other
acts and things as may be reasonably necessary to make such sale or sales of all
or any portion of the Collateral of such Assignor valid and binding and in
compliance with any and all applicable laws, regulations, orders, writs,
injunctions, decrees or awards of any and all courts, arbitrations or
governmental instrumentalities, domestic or foreign, having jurisdiction over
any such sale or sales, all at such Assignor's expense.
8.3 Waiver of Claims. Except as otherwise provided in this Agreement,
EACH ASSIGNOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, NOTICE
AND JUDICIAL HEARING IN CONNECTION WITH THE COLLATERAL AGENT'S TAKING POSSESSION
OR THE COLLATERAL AGENT'S DISPOSITION OF ANY OF THE COLLATERAL, INCLUDING,
WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT
REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH SUCH ASSIGNOR WOULD OTHERWISE HAVE
UNDER THE CONSTITUTION OR ANY STATUTE OF THE UNITED STATES OR OF ANY STATE, and
such Assignor hereby further waives, to the extent permitted by law:
(i) all damages occasioned by such taking of possession or any
such disposition except any damages which are the direct result of the
Collateral Agent's gross negligence or willful misconduct;
(ii) all other requirements as to the time, place and terms of
sale or other requirements with respect to the enforcement of the
Collateral Agent's rights hereunder; and
(iii) all rights of redemption, appraisement, valuation, stay,
extension or moratorium now or hereafter in force under any applicable
law in order to prevent or delay the enforcement of this Agreement or
the absolute sale of the Collateral or any portion thereof, and each
Assignor, for itself and all who may claim under it, insofar as it or
they now or hereafter lawfully may, hereby waives the benefit of all
such laws.
Upon the occurrence of and during the continuance of an Event of Default, any
sale of, or the grant of options to purchase, or any other realization upon, any
Collateral shall operate to divest all right, title, interest, claim and demand,
either at law or in equity, of the relevant Assignor therein and thereto, and
shall be a perpetual bar both at law and in equity against such Assignor and
against any and all Persons claiming or attempting to claim the Collateral so
sold, optioned or realized upon, or any part thereof, from, through and under
such Assignor.
8.4 Application of Proceeds. (a) All moneys collected by the Collateral
Agent upon any sale or other disposition of any Collateral (other than Excluded
Senior [Subordinated] Secured Notes Collateral) pursuant to the enforcement of
this Agreement or the exercise of any of the remedial provisions hereof (or, if
any other Security Document requires proceeds of "collateral" thereunder (other
than Excluded Collateral) to be applied in accordance with the terms of this
Agreement, by such other "collateral agent" thereunder pursuant to the
enforcement of such Security Document or the exercise of the remedial provisions
thereof), together with all
Exhibit H-1-A
Page 25
other moneys received by the Collateral Agent hereunder (or such other
"collateral agent" under such other Security Documents) as a result of any such
enforcement or the exercise of any such remedial provisions (other than with
respect to Excluded Collateral) or as a result of any distribution of any
Collateral (or "collateral" under any other Security Document, as the case may
be) (in each case, other than Excluded Collateral) upon the bankruptcy,
arrangement, receivership, assignment for the benefit of creditors or any other
action or proceeding involving the readjustment of the obligations and
indebtedness of any Credit Party, or the application of any Collateral (or
"collateral" under any other Security Document, as the case may be) (in each
case, other than Excluded Collateral) to the payment thereof or any distribution
of Collateral (or "collateral" under any other Security Document, as the case
may be) (in each case, other than Excluded Collateral) upon the liquidation or
dissolution of any Credit Party, or the winding up of the assets or business of
any Credit Party or under any Mortgage Policies (to the extent same does not
constitute Excluded Collateral), shall be applied as follows:
(i) first, to the payment of all Obligations owing the
Collateral Agent of the type described in clauses (iv), (v) and (vi) of
the definition of "Obligations";
(ii) second, to the extent proceeds remain after the
application pursuant to the preceding clause (i), an amount equal to
the outstanding Primary Obligations shall be paid to the Secured
Creditors as provided in Section 8.4(f), with each Secured Creditor
receiving an amount equal to its outstanding Primary Obligations or, if
the proceeds are insufficient to pay in full all such Primary
Obligations, its Pro Rata Share of the amount remaining to be
distributed;
(iii) third, to the extent proceeds remain after the
application pursuant to the preceding clauses (i) and (ii), an amount
equal to the outstanding Secondary Obligations shall be paid to the
Secured Creditors as provided in Section 8.4(f), with each Secured
Creditor receiving an amount equal to its outstanding Secondary
Obligations or, if the proceeds are insufficient to pay in full all
such Secondary Obligations, its Pro Rata Share of the amount remaining
to be distributed;
(iv) fourth, to the extent proceeds remain after the
applications pursuant to preceding clauses (i) through (iii), an amount
equal to the outstanding Tertiary Obligations (as hereinafter defined)
shall be paid to the Secured Creditors as provided in Section 8.4(f),
with each Secured Creditor receiving an amount equal to its outstanding
Tertiary Obligations or, if the proceeds are insufficient to pay in
full all such Tertiary Obligations, its Pro Rata Share of the amount
remaining to be distributed;
(v) fifth, to the extent proceeds remain after the
applications pursuant to preceding clauses (i) through (iv), an amount
equal to the outstanding Quaternary Obligations (as hereinafter
defined) shall be paid to the Senior [Subordinated] Secured Notes
Creditor as provided in Section 8.4(f), with the Senior [Subordinated]
Secured Notes Creditor to receive an amount equal to the outstanding
Quaternary Obligations or, if the proceeds are insufficient to pay in
full all such Quaternary Obligations, the amount remaining to be
distributed; and
Exhibit H-1-A
Page 26
(vi) sixth, to the extent proceeds remain after the
applications pursuant to preceding clauses (i) through (v), inclusive,
and following the termination of this Agreement pursuant to Section
11.8(a) hereof, to the relevant Assignor or to whomever may be lawfully
entitled to receive such surplus.
(b) All moneys collected by the Collateral Agent upon any sale or other
disposition of any Excluded Senior [Subordinated] Secured Notes Collateral
pursuant to the enforcement of this Agreement or the exercise of any of the
remedial provisions hereof (or, if any other Security Document requires proceeds
of Excluded Collateral thereunder to be applied in accordance with the terms of
this Agreement, by such other "collateral agent" thereunder pursuant to the
enforcement of such Security Document or the exercise of the remedial provisions
thereof), together with all other moneys received by the Collateral Agent
hereunder (or such other "collateral agent" under such other Security Documents)
with respect to Excluded Senior [Subordinated] Secured Notes Collateral (or
Excluded Collateral, as applicable) as a result of any such enforcement or the
exercise of any such remedial provisions or as a result of any distribution of
any Excluded Senior [Subordinated] Secured Notes Collateral (or Excluded
Collateral, as applicable) upon the bankruptcy, arrangement, receivership,
assignment for the benefit of creditors or any other action or proceeding
involving the readjustment of the obligations and indebtedness of any Credit
Party, or the application of any Excluded Senior [Subordinated] Secured Notes
Collateral (or Excluded Collateral, as applicable) to the payment thereof or any
distribution of the Excluded Senior [Subordinated] Secured Notes Collateral (or
Excluded Collateral, as applicable) upon the liquidation or dissolution of any
Credit Party, or the winding up of the assets or business of any Credit Party or
under any Mortgage Policy covering Excluded Senior [Subordinated] Secured Notes
Collateral (or Excluded Collateral, as applicable), shall be applied as follows:
(i) first, to the payment of all Obligations owing the
Collateral Agent of the type described in clauses (iv), (v) and (vi) of
the definition of "Obligations";
(ii) second, to the extent proceeds remain after the
application pursuant to the preceding clause (i), an amount equal to
the outstanding Primary Obligations shall be paid to the Secured
Creditors as provided in Section 8.4(f), with each Secured Creditor
receiving an amount equal to its outstanding Primary Obligations or, if
the proceeds are insufficient to pay in full all such Primary
Obligations, its Pro Rata Share of the amount remaining to be
distributed;
(iii) third, to the extent proceeds remain after the
application pursuant to the preceding clauses (i) and (ii), an amount
equal to the outstanding Secondary Obligations shall be paid to the
Secured Creditors as provided in Section 8.4(f), with each Secured
Creditor receiving an amount equal to its outstanding Secondary
Obligations or, if the proceeds are insufficient to pay in full all
such Secondary Obligations, its Pro Rata Share of the amount remaining
to be distributed;
(iv) fourth, to the extent proceeds remain after the
applications pursuant to preceding clauses (i) through (iii), an amount
equal to the outstanding Tertiary Obligations (as hereinafter defined)
shall be paid to the Secured Creditors as provided in Section 8.4(f),
with each Secured Creditor receiving an amount equal to its outstanding
Exhibit H-1-A
Page 27
Tertiary Obligations or, if the proceeds are insufficient to pay in
full all such Tertiary Obligations, its Pro Rata Share of the amount
remaining to be distributed; and
(v) fifth, to the extent proceeds remain after the
applications pursuant to preceding clauses (i) through (iv), inclusive,
and following the termination of this Agreement pursuant to Section
11.8(a) hereof, to the relevant Assignor or to whomever may be lawfully
entitled to receive such surplus.
(c) For purposes of this Agreement (i) "Pro Rata Share" shall mean,
when calculating a Secured Creditor's portion of any distribution or amount,
that amount (expressed as a percentage) equal to a fraction the numerator of
which is the then unpaid amount of such Secured Creditor's Primary Obligations,
Secondary Obligations, Tertiary Obligations or Quaternary Obligations, as the
case may be, and the denominator of which is the then outstanding amount of all
Primary Obligations, Secondary Obligations, Tertiary Obligations or Quaternary
Obligations, as the case may be, (ii) "Primary Obligations" shall mean (x) in
the case of the Non-Tranche D Credit Document Obligations, all principal of, and
interest on, all Loans (other than Tranche D Term Loans), all Unpaid Drawings
theretofore made (together with all interest accrued thereon), the aggregate
Stated Amounts of all Letters of Credit issued under the Credit Agreement, and
all Fees and (y) in the case of the Other Obligations, all amounts due under any
Interest Rate Protection Agreement or Other Hedging Agreement (other than
indemnities, fees (including, without limitation, attorneys' fees) and similar
obligations and liabilities), (iii) "Secondary Obligations" shall mean all
Obligations other than Primary Obligations, Tertiary Obligations and Quaternary
Obligations, (iv) "Tertiary Obligations" shall mean all Tranche D Obligations
and (v) "Quaternary Obligations" shall mean all Senior [Subordinated] Secured
Notes Obligations. Furthermore, and notwithstanding anything to the contrary
contained elsewhere in this Agreement, to the extent that, after the Fifth
Amendment Effective Date, the relevant Secured Creditors amend or modify the
Credit Documents, the Senior [Subordinated] Secured Notes Documents or the other
Secured Debt Agreements in a manner which has the effect of increasing the
outstanding amount of the Primary Obligations, Secondary Obligations, Tertiary
Obligations or Quaternary Obligations, as the case may be, above the amounts
thereof as then in effect, then to the extent additional amounts are owing as a
result thereof, such additional amounts shall be deemed to constitute Primary
Obligations, Secondary Obligations, Tertiary Obligations or Quaternary
Obligations, as the case may be, in each case so long as the amendments or
modifications which effect such increased amounts are made in accordance with
the requirements set forth in clause (x) of the second proviso appearing in the
first sentence of Section 11.2(a) below.
(d) When payments to Secured Creditors are based upon their respective
Pro Rata Shares, the amounts received by such Secured Creditors hereunder shall
be applied (for purposes of making determinations under this Section 8.4 only)
(i) first, to their Primary Obligations, (ii) second, to the Secondary
Obligations (other than Secondary Obligations constituting indemnity or
reimbursement obligations not then due and owing and for which no claim has been
made at the time of the proposed payment), (iii) third, to their Tertiary
Obligations and, in the case of distributions pursuant to Section 8.4(a), (iv)
fourth, to their Quaternary Obligations.
Exhibit H-1-A
Page 28
(e) Each of the Secured Creditors agrees and acknowledges that if the
Non-Tranche D Bank Creditors are to receive a distribution on account of undrawn
amounts with respect to Letters of Credit issued (or deemed issued) under the
Credit Agreement (which shall only occur after all outstanding Loans (other than
Tranche D Term Loans) and Unpaid Drawings with respect to such Letters of Credit
have been paid in full), such amounts shall be paid to the Administrative Agent
under the Credit Agreement and held by it, for the equal and ratable benefit of
the Non-Tranche D Bank Creditors, as cash security for the repayment of
Non-Tranche D Credit Document Obligations owing to the Non-Tranche D Bank
Creditors as such. If any amounts are held as cash security pursuant to the
immediately preceding sentence, then upon the termination of all outstanding
Letters of Credit, and after the application of all such cash security to the
repayment of all Non-Tranche D Credit Document Obligations owing to the
Non-Tranche D Bank Creditors after giving effect to the termination of all such
Letters of Credit, if there remains any excess cash, such excess cash shall be
returned by the Administrative Agent to the Collateral Agent for distribution in
accordance with Section 8.4(a) or (b) hereof, as applicable.
(f) Except as set forth in Section 8.4(e), all payments required to be
made hereunder shall be made (w) if to the Non-Tranche D Bank Creditors, to the
Administrative Agent under the Credit Agreement for the account of (and for
distribution to) the Non-Tranche D Bank Creditors, (x) if to the Tranche D
Banks, to the Administrative Agent under the Credit Agreement for the account of
(and for distribution to) the Tranche D Banks, (y) if to the Senior
[Subordinated] Secured Notes Creditor, to the Senior [Subordinated] Secured
Notes Indenture Trustee under the Senior [Subordinated] Secured Notes Indenture
for the account of (and for distribution to) the Senior [Subordinated] Secured
Notes Trustee and the Senior [Subordinated] Secured Noteholders in accordance
with the requirements of the Senior [Subordinated] Secured Notes Indenture and
(z) if to any other Secured Creditor (other than the Collateral Agent), to the
Authorized Representative for such other Secured Creditor, or in the absence of
such an Authorized Representative, directly to such other Secured Creditor.
(g) For purposes of applying payments received in accordance with this
Section 8.4, the Collateral Agent shall be entitled to rely upon (i) the
Administrative Agent under the Credit Agreement, (ii) the Senior [Subordinated]
Secured Notes Trustee under the Senior [Subordinated] Secured Notes Indenture
and (iii) each Authorized Representative of an Other Creditor (or, in the
absence of any such Authorized Representative, directly upon such other relevant
Secured Creditors), for a determination (which each Authorized Representative
for any Secured Creditor and the Secured Creditors agree to provide upon request
of the Collateral Agent) of the outstanding Primary Obligations, Secondary
Obligations, Tertiary Obligations and Quaternary Obligations (and Dollar
Equivalents thereof) owed to the Non-Tranche D Bank Creditors, the Tranche D
Banks, the Other Creditors or the Senior [Subordinated] Secured Notes Creditor,
as the case may be. Unless it has actual knowledge (including by way of written
notice from any Bank Creditor, any Other Creditor or any of their respective
Authorized Representatives) to the contrary, the Administrative Agent and each
other Authorized Representative, in furnishing information pursuant to the
preceding sentence, and the Collateral Agent, in acting hereunder, shall be
entitled to assume that no Secondary Obligations are outstanding. Unless it has
actual knowledge (including by way of written notice from an Other Creditor) to
the contrary, the Collateral Agent, in acting hereunder, shall be entitled to
assume that no Interest Rate Protection Agreements or Other Hedging Agreements
are in existence.
Exhibit H-1-A
Page 29
(h) Distributions made in accordance with this Section 8.4 shall,
notwithstanding anything to the contrary contained in this Agreement, be subject
to [(i) the express subordination provisions contained in the Senior
Subordinated Secured Notes Documents and, as a result thereof, to the extent any
Secured Creditor receives a distribution pursuant to this Section 8.4 which must
be turned over or applied in accordance with said subordination provisions, said
subordination provisions shall control the ultimate distribution of such amounts
and (ii)](6) the turnover provisions contained in Section 15 of the Credit
Agreement and, as a result thereof, to the extent any Tranche D Bank receives a
distribution pursuant to this Section 8.4 which must be turned over to the
Non-Tranche D Bank Creditors in accordance with said provisions, such provisions
shall control the ultimate distribution of such amounts.
(i) It is understood and agreed that each of the Assignors shall remain
liable to the relevant Secured Creditors to the extent of any deficiency between
the amount of the proceeds of the Collateral received by such Secured Creditors
hereunder and the aggregate amount of the sums referred to in clause (a) or (b),
as the case may be, of this Section with respect to the relevant Assignor.
8.5 Remedies Cumulative. Each and every right, power and remedy hereby
specifically given to the Collateral Agent shall be in addition to every other
right, power and remedy specifically given under this Agreement or any other
Secured Debt Agreement now or hereafter existing at law, in equity or by statute
and each and every right, power and remedy whether specifically herein given or
otherwise existing may, subject to the last sentence of Section 8.1, be
exercised from time to time or simultaneously and as often and in such order as
may be deemed expedient by the Collateral Agent. All such rights, powers and
remedies shall be cumulative and the exercise or the beginning of the exercise
of one shall not be deemed a waiver of the right to exercise any other or
others. No delay or omission of the Collateral Agent in the exercise of any such
right, power or remedy and no renewal or extension of any of the Obligations
shall impair any such right, power or remedy or shall be construed to be a
waiver of any Default or Event of Default or an acquiescence therein. No notice
to or demand on any Assignor in any case shall entitle it to any other or
further notice or demand in similar or other circumstances or constitute a
waiver of any of the rights of the Collateral Agent to any other or further
action in any circumstances without notice or demand. In the event that the
Collateral Agent shall bring any suit to enforce any of its rights hereunder and
shall be entitled to judgment, then in such suit the Collateral Agent may
recover expenses, including attorneys' fees, and the amounts thereof shall be
included in such judgment.
8.6 Discontinuance of Proceedings. In case the Collateral Agent shall
have instituted any proceeding to enforce any right, power or remedy under this
Agreement by foreclosure, sale, entry or otherwise, and such proceeding shall
have been discontinued or abandoned for any reason or shall have been determined
adversely to the Collateral Agent, then and in every such case the relevant
Assignor, the Collateral Agent and each holder of any of the Obligations shall
be restored to their former positions and rights hereunder with respect to the
Collateral subject to
- ----------
(6) Bracketed text to be included in the event a Qualified Exchange Transaction
is to be consummated.
Exhibit H-1-A
Page 30
the security interest created under this Agreement, and all rights, remedies and
powers of the Collateral Agent shall continue as if no such proceeding had been
instituted.
ARTICLE IX
INDEMNITY
9.1 Indemnity. (a) Each Assignor jointly and severally agrees to
indemnify, reimburse and hold the Collateral Agent, each other Secured Creditor
and their respective successors, permitted assigns, employees, agents and
servants (hereinafter in this Section 9.1 referred to individually as an
"Indemnitee," and, collectively, as "Indemnitees") harmless from any and all
liabilities, obligations, damages, injuries, penalties, claims, demands,
actions, suits, judgments and any and all costs, expenses or disbursements
(including attorneys' fees and expenses) (for the purposes of this Section 9.1
the foregoing are collectively called "expenses") of whatsoever kind and nature
imposed on, asserted against or incurred by any of the Indemnitees in any way
relating to or arising out of this Agreement, any other Secured Debt Agreement
or any other document executed in connection herewith or therewith or in any
other way connected with the administration of the transactions contemplated
hereby or thereby or the enforcement of any of the terms of, or the preservation
of any rights under any thereof, or in any way relating to or arising out of the
manufacture, ownership, ordering, purchase, delivery, control, acceptance,
lease, financing, possession, operation, condition, sale, return or other
disposition, or use of the Collateral (including, without limitation, latent or
other defects, whether or not discoverable), the violation of the laws of any
country, state or other governmental body or unit, any tort (including, without
limitation, claims arising or imposed under the doctrine of strict liability, or
for or on account of injury to or the death of any Person (including any
Indemnitee), or property damage), or contract claim; provided that no Indemnitee
shall be indemnified pursuant to this Section 9.1(a) for losses, damages or
liabilities to the extent caused by the gross negligence or willful misconduct
of such Indemnitee. Each Assignor agrees that upon written notice by any
Indemnitee of the assertion of such a liability, obligation, damage, injury,
penalty, claim, demand, action, suit or judgment, the relevant Assignor shall
assume full responsibility for the defense thereof. Each Indemnitee agrees to
use its best efforts to promptly notify the relevant Assignor of any such
assertion of which such Indemnitee has knowledge.
(b) Without limiting the application of Section 9.1(a), each Assignor
agrees, jointly and severally, to pay, or reimburse the Collateral Agent for any
and all fees, costs and expenses of whatever kind or nature incurred in
connection with the creation, preservation or protection of the Collateral
Agent's Liens on, and security interest in, the Collateral, including, without
limitation, all fees and taxes in connection with the recording or filing of
instruments and documents in public offices, payment or discharge of any taxes
or Liens upon or in respect of the Collateral, premiums for insurance with
respect to the Collateral and all other fees, costs and expenses in connection
with protecting, maintaining or preserving the Collateral and the Collateral
Agent's interest therein, whether through judicial proceedings or otherwise, or
in defending or prosecuting any actions, suits or proceedings arising out of or
relating to the Collateral.
(c) Without limiting the application of Section 9.1(a) or (b), each
Assignor agrees, jointly and severally, to pay, indemnify and hold each
Indemnitee harmless from and
Exhibit H-1-A
Page 31
against any loss, costs, damages and expenses which such Indemnitee may suffer,
expend or incur in consequence of or growing out of any misrepresentation by any
Assignor in this Agreement, any other Secured Debt Agreement or in any writing
contemplated by or made or delivered pursuant to or in connection with this
Agreement or any other Secured Debt Agreement.
(d) If and to the extent that the obligations of any Assignor under
this Section 9.1 are unenforceable for any reason, such Assignor hereby agrees
to make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law.
9.2 Indemnity Obligations Secured by Collateral; Survival . Any amounts
paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral. The
indemnity obligations of each Assignor contained in this Article IX shall
continue in full force and effect notwithstanding the full payment of all the
Notes issued under the Credit Agreement, the full repayment of all the Senior
[Subordinated] Secured Notes, the termination of all Interest Rate Protection
Agreements or Other Hedging Agreements and Letters of Credit, and the payment of
all other Obligations and notwithstanding the discharge thereof.
ARTICLE X
DEFINITIONS
The following terms shall have the meanings herein specified. Such
definitions shall be equally applicable to the singular and plural forms of the
terms defined. Except as otherwise defined in this Article X, terms used in this
Agreement shall have the meaning provided such terms in the Credit Agreement
(or, at any time on and after the Credit Documents Obligations Termination Date,
the Credit Agreement as in effect on such date (without giving effect to the
termination thereof)).
"Administrative Agent" shall have the meaning provided in the recitals
to this Agreement.
"Agreement" shall have the meaning provided in the preamble to this
Agreement.
"As-Extracted Collateral" shall mean "as-extracted collateral" as such
term is defined in the Uniform Commercial Code as in effect on the date hereof
in the State of New York.
"Assignor" shall have the meaning provided in the preamble to this
Agreement.
"Authorized Representative" shall have the meaning provided in Annex J
hereto.
"Bank Creditors" shall have the meaning provided in the recitals to
this Agreement.
Exhibit H-1-A
Page 32
"Banks" shall have the meaning provided in the recitals to this
Agreement.
"Canadian Borrower" shall have the meaning provided in the recitals to
this Agreement.
"Cash Collateral Account" shall mean a non-interest bearing cash
collateral account maintained with, and in the sole dominion and control of, the
Collateral Agent for the benefit of the Secured Creditors (excluding the Senior
[Subordinated] Secured Notes Creditor in the case of cash constituting Excluded
Senior [Subordinated] Secured Notes Collateral).
"Chattel Paper" shall mean "chattel paper" as such term is defined in
the Uniform Commercial Code as in effect on the Second Restatement Effective
Date in the State of New York. Without limiting the foregoing, the term "Chattel
Paper" shall in any event include all Tangible Chattel Paper and all Electronic
Chattel Paper.
"Class" shall have the meaning provided in Section 11.2 of this
Agreement.
"Collateral" shall have the meaning provided in Section 1.1(a) of this
Agreement.
"Collateral Agent" shall have the meaning provided in the preamble to
this Agreement.
"Commercial Tort Claims" shall mean "commercial tort claims" as such
term is defined in the Uniform Commercial Code as in effect on the Second
Restatement Effective Date in the State of New York.
"Contract Rights" shall mean all rights of any Assignor under each
Contract, including, without limitation, (i) any and all rights to receive and
demand payments under any or all Contracts and any or all Excluded Contracts,
(ii) any and all rights to receive and compel performance under any or all
Contracts and (iii) any and all other rights, interests and claims now existing
or in the future arising in connection with any or all Contracts.
"Contracts" shall mean all contracts between any Assignor and one or
more additional parties (including, without limitation, any Interest Rate
Protection Agreement or Other Hedging Agreement) to the extent the grant by an
Assignor of a security interest pursuant to this Agreement in its right, title
and interest in any such contract is not prohibited by such contract (or, if
prohibited, the consent of each other party is obtained) and would not give any
other party to such contract the right to terminate, or automatically result in
the termination of, such other party's obligations thereunder or the Assignor's
rights thereunder (those contracts where such grant is so prohibited (and
consent not obtained) or resulting in such a right of or automatic termination
are referred to herein as "Excluded Contracts").
"Copyrights" shall mean any U.S. or foreign copyright owned by any
Assignor, including any registrations of any Copyrights, in the U.S. Copyright
Office or the equivalent thereof in any foreign country, as well as any
application for a U.S. or foreign copyright registration now or hereafter made
with the U.S. Copyright Office or the equivalent thereof in any foreign
jurisdiction by any Assignor.
Exhibit H-1-A
Page 33
"Credit Agreement" shall have the meaning provided in the recitals to
this Agreement.
"Credit Documents" shall mean the "Credit Documents" under, and as
defined in, the Credit Agreement and shall include any credit documentation
executed and delivered in connection with any replacement or refinancing Credit
Agreement.
"Credit Document Obligations" shall have the meaning provided in the
definition of "Obligations" in this Article X.
"Credit Document Obligations Termination Date" shall mean that date
upon which all Credit Document Obligations (other than those arising from
indemnities for which no request has been made) have been paid in full and all
Commitments and Letters of Credit under the Credit Agreement have been
terminated.
"Default" shall mean any event which, with notice or lapse of time, or
both, would constitute an Event of Default.
"Deposit Accounts" shall mean all "deposit accounts" as such term is
defined in the Uniform Commercial Code as in effect on the Second Restatement
Effective Date in the State of New York.
"Documentation Agent" shall have the meaning provided in the recitals
to this Agreement.
"Documents" shall mean "documents" as such term is defined in the
Uniform Commercial Code as in effect on the Second Restatement Effective Date in
the State of New York.
"Electronic Chattel Paper" shall mean "electronic chattel paper" as
such term is defined in the Uniform Commercial Code as in effect on the Second
Restatement Effective Date in the State of New York.
"Equipment" shall mean any "equipment," as such term is defined in the
Uniform Commercial Code as in effect on the Second Restatement Effective Date in
the State of New York, now or hereafter owned by any Assignor and, in any event,
shall include, but shall not be limited to, all machinery, equipment,
furnishings, movable trade fixtures and vehicles now or hereafter owned by any
Assignor and any and all additions, substitutions and replacements of any of the
foregoing and all accessories thereto, wherever located, together with all
attachments, components, parts, equipment and accessories installed thereon or
affixed thereto but excluding Equipment to the extent it is subject to a
Permitted Lien and the terms of the Indebtedness securing such Permitted Lien
prohibits assignment of, or granting of a security interest in, such Assignor's
rights and interests therein.
"Event of Default" shall mean (i) any Event of Default under, and as
defined in, the Credit Agreement, (ii) any Event of Default under, and as
defined in, the Senior [Subordinated] Secured Notes Indenture, (iii) any payment
default under any Interest Rate
Exhibit H-1-A
Page 34
Protection Agreement or Other Hedging Agreement and (iv) any payment default on
any of the Obligations after the expiration of any applicable grace period.
"Excluded Senior [Subordinated] Secured Notes Collateral" shall mean
and include (i) all capital stock, Notes, Instruments, Investment Property and
other equity interests and Securities owned or held by any Assignor, (ii) [any
and all Collateral owned or held by Holdings, (iii)] any and all assets of the
Assignors that are covered by a certificate of title issued by any foreign
country or governmental unit thereof or, in the case of Marks, Patents,
Copyrights and Permits, registered, filed or issued, as the case may be, under
the laws of any foreign country or governmental unit thereof and all other
assets owned or held by any Assignor situated, located or held outside the
United States, in each case, to the extent that the perfection of a security
interest in such assets cannot be effected under the laws of the United States
or any State thereof and [(iii)] [(iv)] all Proceeds of the Collateral described
in preceding clauses [(i) and (ii)] [(i), (ii) and (iii)].
"Excluded Collateral" shall mean and include (i) Excluded Senior
[Subordinated] Secured Notes Collateral, (ii) any "collateral" under any
Canadian Security Document, Mexican Security Document or Additional Foreign
Security Agreement and (iii) and any other "collateral" under any other Security
Document which is excluded as security for, or does not secure, the Senior
[Subordinated] Secured Notes Obligations, to the extent such other "collateral"
constitutes (I) collateral of the type described in clause (i) of the definition
of "Excluded Senior [Subordinated] Secured Notes Collateral", (II) [collateral
of any type owned or held by Holdings, (III)] assets that are covered by
certificate of title issued by a foreign country or governmental unit thereof
or, in the case of intellectual property and permits, registered, filed or
issued, as the case may be, under the laws of any foreign country or
governmental unit thereof or other assets situated, located or held outside the
United States, in each case, to the extent that the perfection of a security
interest in such assets cannot be effected under the laws of the United States
or any State thereof or (IV) proceeds of any "collateral" described in preceding
clauses [(I) and (II)] [(I), (II) and (III)].
"Excluded Contracts" shall have the meaning provided in the definition
of Contracts.
"General Intangibles" mean "general intangibles" as such term is
defined in the Uniform Commercial Code as in effect on the Second Restatement
Effective Date in the State of New York.
"Goods" shall mean "goods" as such term is defined in the Uniform
Commercial Code as in effect on the Second Restatement Effective Date in the
State of New York.
"Health-Care-Insurance Receivable" shall mean any
"health-care-insurance receivable" as such term is defined in the Uniform
Commercial Code as in effect on Second Restatement Effective Date in the State
of New York.
Exhibit H-1-A
Page 35
["Holdings" shall have the meaning provided in the recitals to this
Agreement.](7)
"Indemnitee" shall have the meaning provided in Section 9.1 of this
Agreement.
"Instrument" shall mean "instrument" as such term is defined in the
Uniform Commercial Code as in effect on the Second Restatement Effective Date in
the State of New York.
"Interest Rate Protection Agreement or Other Hedging Agreement" shall
have the meaning provided in the recitals to this Agreement.
"Inventory" shall mean merchandise, inventory and goods, and all
additions, substitutions and replacements thereof and all accessions thereto,
wherever located, together with all goods, supplies, incidentals, packaging
materials, labels, materials and any other items used or usable in
manufacturing, processing, packaging or shipping same; in all stages of
production -- from raw materials through work-in-process to finished goods --
and all products and proceeds of whatever sort and wherever located and any
portion thereof which may be returned, rejected, reclaimed or repossessed by the
Collateral Agent from any Assignor's customers, and shall specifically include
all "inventory" as such term is defined in the Uniform Commercial Code as in
effect on the Second Restatement Effective Date in the State of New York, now or
hereafter owned by any Assignor.
"Investment Property" shall mean "investment property" as such term is
defined in the Uniform Commercial Code as in effect on the Second Restatement
Effective Date in the State of New York.
"Letter-of-Credit Rights" shall mean "letter-of-credit rights" as such
term is defined in the Uniform Commercial Code as in effect on the Second
Restatement Effective Date in the State of New York.
"Liens" shall mean any security interest, mortgage, pledge, lien,
claim, charge, encumbrance, title retention agreement, lessor's interest in a
financing lease or analogous instrument, in, of, or on any Assignor's property.
"Location" of any Assignor, shall mean such Assignor's "location" as
determined pursuant to Section 9-307 of the UCC.
"Marks" shall mean all right, title and interest in and to any U.S. or
foreign trademarks, service marks and trade names now held or hereafter acquired
by any Assignor, including any registration or application for registration of
any trademarks and service marks in the United States Patent and Trademark
Office, or the equivalent thereof in any State of the United States or in any
foreign country, and any trade dress including logos, designs, trade names,
company names, business names, fictitious business names and other business
identifiers in connection with which any of these registered or unregistered
marks are used.
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(7) See footnote 1.
Exhibit H-1-A
Page 36
"Non-Senior [Subordinated] Secured Notes Obligations" shall mean all
Obligations other than Senior [Subordinated] Secured Notes Obligations.
"Non-Senior [Subordinated] Secured Notes Obligations Termination Date"
shall mean the date upon which the Total Commitment under the Credit Agreement
has been terminated, all Letters of Credit issued under the Credit Agreement
have been terminated, no Note under the Credit Agreement is outstanding and all
Loans thereunder have been indefeasibly repaid in full, all Interest Rate
Protection Agreements and Other Hedging Agreements entered into with any Other
Creditors have been terminated, and all other Obligations (other than (I) the
Senior [Subordinated] Secured Notes Obligations and (II) those Obligations
arising from indemnities for which no claim has been made) then owing have been
indefeasibly paid in full.
"Non-Tranche D Bank Creditors" shall mean the Bank Creditors (other
than the Tranche D Banks).
"Non-Tranche D Credit Document Obligations" shall mean the Credit
Document Obligations (other than the Tranche D Obligations).
"Non-Tranche D Credit Document Obligations Termination Date" shall mean
that date upon which all Non-Tranche D Credit Document Obligations (other than
those arising from indemnities for which no request has been made) have been
paid in full and all Commitments and Letters of Credit under the Credit
Agreement have been terminated.
"Obligations" shall mean (i) the full and prompt payment when due
(whether at the stated maturity, by acceleration or otherwise) of all
obligations and liabilities (including, without limitation, indemnities, fees
and interest thereon and all interest that accrues after the commencement of any
case, proceeding or other action relating to the bankruptcy, insolvency,
reorganization or similar proceeding of [Holdings] [the U.S. Borrower] or any
other Credit Party at the rate provided for in the respective documentation,
whether or not a claim for post-petition interest is allowed in any such
proceeding) of each Assignor owing to the Bank Creditors, now existing or
hereafter incurred under, arising out of or in connection with any Credit
Document to which such Assignor is a party (including, in the case of each
Guarantor, all such obligations and indebtedness under any Guaranty to which
such Assignor is a party) and the due performance and compliance by each
Assignor with the terms, conditions and agreements of each such Credit Document
(all such obligations or liabilities under this clause (i), except to the extent
consisting of obligations or indebtedness with respect to Interest Rate
Protection Agreements or Other Hedging Agreements, being herein collectively
called the "Credit Document Obligations"); (ii) the full and prompt payment when
due (whether at the stated maturity, by acceleration or otherwise) of all
obligations and liabilities (including, without limitation, indemnities, fees
and interest thereon) of each Assignor owing to the Other Creditors, now
existing or hereafter incurred under, arising out of or in connection with any
Interest Rate Protection Agreement or Other Hedging Agreement, whether such
Interest Rate Protection Agreement or Other Hedging Agreement is now in
existence or hereafter arising, including, in the case of each Guarantor, all
obligations under the Guaranty in respect of Interest Rate Protection Agreements
or Other Hedging Agreements, and the due performance and compliance by such
Assignor with all of the terms, conditions and agreements contained in any such
Interest Rate Protection Agreement or Other Hedging Agreement (all such
obligations and indebtedness under this clause (ii) being
Exhibit H-1-A
Page 37
herein collectively called the "Other Obligations"); (iii) the full and prompt
payment when due (whether at the stated maturity, by acceleration or otherwise)
of all obligations, liabilities and indebtedness (including, without limitation,
indemnities, fees and expenses, all interest thereon and all interest that
accrues after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency, reorganization or similar proceeding of
[Holdings] [the U.S. Borrower] or any other Credit Party at the rate provided
for in the respective documentation, whether or not a claim for post-petition
interest is allowed in any such proceeding) of each Assignor owing to the Senior
[Subordinated] Secured Noteholders and the Senior [Subordinated] Secured Notes
Creditor, whether now existing or hereafter incurred under, arising out of or in
connection with any Senior [Subordinated] Secured Notes Document to which such
Assignor is a party (including, in the case of each Subsidiary Guarantor, all
such obligations and indebtedness under any guaranty constituting a Senior
[Subordinated] Secured Notes Document to which such Assignor is a party) and the
due performance and compliance by each Assignor with all of the terms,
conditions and agreements contained in each such Senior [Subordinated] Secured
Notes Document (all such obligations and liabilities under this clause (iii)
being herein collectively called the "Senior [Subordinated] Secured Notes
Obligations"); (iv) any and all sums advanced by the Collateral Agent in order
to preserve the Collateral or preserve its security interest in the Collateral;
(v) in the event of any proceeding for the collection or enforcement of any
indebtedness, obligations, or liabilities of each Assignor referred to in
clauses (i), (ii), (iii) and (iv) after an Event of Default shall have occurred
and be continuing, the reasonable expenses of re-taking, holding, preparing for
sale or lease, selling or otherwise disposing of or realizing on the Collateral,
or of any exercise by the Collateral Agent of its rights hereunder, together
with reasonable attorneys' fees and court costs; and (vi) all amounts paid by
any Indemnitee as to which such Indemnitee has the right to reimbursement under
Section 9.1 of this Agreement. It is acknowledged and agreed that the
"Obligations" shall include extensions of credit of the types described above,
whether outstanding on the date of this Agreement or extended from time to time
after the date of this Agreement; provided that in the case of additional
extensions of credit included as "Obligations" hereunder by way of an amendment
or modification to this Agreement, such amendment or modification (and the
additional extension of credit permitted thereby) shall comply with the
requirements of clause (x) of the second proviso appearing in the first sentence
of Section 11.2(a). Notwithstanding anything to the contrary contained above in
this definition, obligations and liabilities which would otherwise constitute
Obligations pursuant to clause (iii) of the first sentence of this definition
shall not constitute Obligations for purposes of (or be secured pursuant to)
this Agreement to the extent incurred (or guaranteed) in violation of the
provisions of Section 9.04 of the Credit Agreement as same is in effect on the
Fifth Amendment Effective Date (but only with respect to that portion of
indebtedness outstanding (or guaranteed) in violation thereof).
"Original Amended and Restated U.S. Security Agreement" shall have the
meaning provided in the recitals to this Agreement.
"Other Creditors" shall have the meaning provided in the recitals to
this Agreement.
"Other Obligations" shall have the meaning provided in the definition
of "Obligations" in this Article X.
Exhibit H-1-A
Page 38
"Patents" shall mean any U.S. or foreign patent with respect to which
any Assignor now or hereafter has any right, title or interest, and any
divisions, continuations (including, but not limited to, continuations-in-parts)
and improvements thereof, as well as any application for a U.S. or foreign
patent now or hereafter made by any Assignor.
"Permits" shall mean, to the extent permitted to be assigned by the
terms thereof or by applicable law, all licenses, permits, rights, orders,
variances, franchises or authorizations (including certificates of need) of or
from any governmental authority or agency.
"Permitted Business" shall have the meaning provided in the Credit
Agreement.
"Primary Obligations" shall have the meaning provided in Section 8.4(c)
of this Agreement.
"Proceeds" shall have the meaning provided in the Uniform Commercial
Code as in effect in the State of New York on the Second Restatement Effective
Date or under other relevant law and, in any event, shall include, but not be
limited to, (i) any and all proceeds of any insurance, indemnity, warranty or
guaranty payable to the Collateral Agent or any Assignor from time to time with
respect to any of the Collateral, (ii) any and all payments (in any form
whatsoever) made or due and payable to any Assignor from time to time in
connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any part of the Collateral by any governmental authority
(or any person acting under color of governmental authority) and (iii) any and
all other amounts from time to time paid or payable under or in connection with
any of the Collateral.
"Pro Rata Share" shall have the meaning provided in Section 8.4(c) of
this Agreement.
"Quaternary Obligations" shall have the meaning provided in Section
8.4(c) of this Agreement.
"Receivable" shall mean any "account" as such term is defined in the
Uniform Commercial Code as in effect on the Second Restatement Effective Date in
the State of New York, and in any event shall include but shall not be limited
to, all rights to payment of any monetary obligation, whether or not earned by
performance, (i) for property that has been or is to be sold, leased, licensed,
assigned or otherwise disposed of, (ii) for services rendered or to be rendered,
(iii) for a policy of insurance issued or to be issued, (iv) for a secondary
obligation incurred or to be incurred, (v) for energy provided or to be
provided, (vi) for the use or hire of a vessel under a charter or other
contract, (vii) arising out of the use of a credit or charge card or information
contained on or for use with the card, or (viii) as winnings in a lottery or
other game of chance operated or sponsored by a State, governmental unit of a
State, or person licensed or authorized to operate the game by a State or
governmental unit of a State. Without limiting the foregoing, the term "account"
shall include all Health-Care-Insurance Receivables.
"Registered Organization" shall have the meaning provided in the
Uniform Commercial Code as in effect on the Second Restatement Effective Date in
the State of New York.
Exhibit H-1-A
Page 39
"Required Secured Creditors" shall mean (i) at all times prior to the
occurrence of the Non-Tranche D Credit Document Obligations Termination Date,
the Required Banks (or, to the extent required by Section 13.12 of the Credit
Agreement, each of the Banks), (ii) at all times on and after the Non-Tranche D
Credit Document Obligations Termination Date and prior to the Tranche D Credit
Document Obligations Termination Date, the Required Tranche D Banks (or, to the
extent required by Section 13.12 of the Credit Agreement, each of the Tranche D
Banks), and (iii) at all times on and after the Tranche D Credit Document
Obligations Termination Date, the holders of at least the majority of the then
outstanding Obligations (determined, in the case of Other Obligations, by the
Collateral Agent in such reasonable manner as is acceptable to it and, in the
case of the Senior [Subordinated] Secured Notes Obligations, by the Senior
[Subordinated] Secured Notes Indenture Trustee in accordance with the provisions
of the Senior [Subordinated] Secured Notes Indenture).
"Requisite Creditors" shall have the meaning provided in Section 11.2
of this Agreement.
"Secondary Obligations" shall have the meaning provided in Section
8.4(c) of this Agreement.
"Second Restatement Effective Date" shall mean the date of the
execution and delivery of this Agreement by each of the undersigned Assignors
and the Collateral Agent.
"Secured Creditors" shall mean, collectively, the Bank Creditors, the
Other Creditors, and the Senior [Subordinated] Secured Notes Creditor.
"Secured Debt Agreements" shall mean and include (i) this Agreement,
(ii) the Credit Agreement, the other Credit Documents and, to the extent then in
effect, any Interest Rate Protection Agreement or Other Hedging Agreement
entered into with any Other Creditors and (iii) the Senior [Subordinated]
Secured Notes Documents.
"Security" shall mean "security" as such term is defined in the Uniform
Commercial Code as in effect on the Second Restatement Effective Date in the
State of New York.
"Senior [Subordinated] Secured Noteholders" shall have the meaning
provided in the recitals to this Agreement.
"Senior [Subordinated] Secured Notes" shall mean the U.S. Borrower's
12-1/2% Senior [Subordinated] Secured Notes due 2008 issued pursuant to the
Senior [Subordinated] Secured Notes Indenture and otherwise in accordance with
the requirements of the definition of "Senior [Subordinated] Secured Notes"
contained in the Credit Agreement (as in effect on the Second Restatement
Effective Date), as the same are in effect on the Second Restatement Effective
Date and as the same may be amended, modified and/or supplemented from time to
time in accordance with the terms thereof and of the Credit Agreement. For
purposes of this Agreement, the term "Senior [Subordinated] Secured Notes" shall
include any senior secured notes issued in exchange for Senior [Subordinated]
Secured Notes (as defined above in the absence of this sentence) pursuant to the
Senior [Subordinated] Secured Notes Indenture, so long as same are issued in
accordance with the requirements of the definition of "Permanent
Exhibit H-1-A
Page 40
Exchange Senior [Subordinated] Secured Notes" appearing in the Credit Agreement
(as in effect on the Second Restatement Effective Date).
"Senior [Subordinated] Secured Notes Creditor" shall mean the Senior
[Subordinated] Secured Notes Indenture Trustee for the benefit of itself and the
Senior [Subordinated] Secured Noteholders.
"Senior [Subordinated] Secured Notes Documents" shall mean the Senior
[Subordinated] Secured Notes, the Senior [Subordinated] Secured Notes Indenture
and the other documents and instruments executed and delivered with respect to
the Senior [Subordinated] Secured Notes or the Senior [Subordinated] Secured
Notes Indenture, in each case as in effect on the Second Restatement Effective
Date and the same may be amended, modified and/or supplemented time to time in
accordance with the terms thereof and of the Credit Agreement.
"Senior [Subordinated] Secured Notes Indenture" shall mean the
Indenture, dated as of [ ], 2002, among the U.S. Borrower, various
Subsidiaries of the U.S. Borrower and the Senior [Subordinated] Secured Notes
Indenture Trustee, as in effect on the Second Restatement Effective Date and as
the same may be amended, modified and/or supplemented from time to time in
accordance with the terms thereof and of the Credit Agreement.
"Senior [Subordinated] Secured Notes Indenture Trustee" shall have the
meaning provided in the recitals to this Agreement.
"Senior [Subordinated] Secured Notes Obligations" shall have the
meaning provided in the definition of Obligations.
"Software" shall mean "software" as such term is defined in the Uniform
Commercial Code as in effect on the Second Restatement Effective Date in the
State of New York.
"Supporting Obligations" shall mean any "supporting obligation" as such
term is defined in the Uniform Commercial Code as in effect on the Second
Restatement Effective Date in the State of New York, now or hereafter owned by
any Assignor, or in which any Assignor has any rights, and, in any event, shall
include, but shall not be limited to all of such Assignor's rights in any
Letter-of-Credit Right or secondary obligation that supports the payment or
performance of, and all security for, any Receivable, Chattel Paper, Document,
General Intangible, Instrument or Investment Property.
"Syndication Agent" shall have the meaning provided in the recitals to
this Agreement.
"Tangible Chattel Paper" shall mean "tangible chattel paper" as such
term is defined in the Uniform Commercial Code as in effect on the date hereof
in the State of New York.
"Termination Date" shall have the meaning provided in Section 11.8 of
this Agreement.
Exhibit H-1-A
Page 41
"Timber-to-be-Cut" shall mean "timber-to-be-cut" as such term is used
in the Uniform Commercial Code as in effect on the Second Restatement Effective
Date in the State of New York.
"Trade Secret Rights" shall have the meaning provided in Section 5.1 of
this Agreement.
"Tractor Trailer" shall mean any truck, tractor, trailer, tank trailer
or other trailer or similar vehicle or trailer.
"Tranche D Credit Document Obligations Termination Date" shall mean the
date upon which all Tranche D Obligations (other than those arising under
indemnities for which no claim has been made) have been paid in full and the
Tranche D Term Loan Commitment has been terminated.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as
amended, and the rules and regulations promulgated thereunder from time to time.
"U.S. Borrower" shall have the meaning provided in the recitals to this
Agreement.
"U.S. Pledge Agreement" shall have the meaning provided in the Credit
Agreement.
"U.S. Subsidiaries Guaranty" shall have the meaning provided in the
recitals to this Agreement.
ARTICLE XI
MISCELLANEOUS
11.1 Notices. Except as otherwise specified herein, all notices,
requests, demands or other communications to or upon the respective parties
hereto shall be deemed to have been duly given or made when delivered to the
party to which such notice, request, demand or other communication is required
or permitted to be given or made under this Agreement, addressed:
(a) if to any Assignor, at its address set forth opposite its
signature below;
(b) if to the Collateral Agent:
Credit Suisse First Boston
11 Madison Avenue
New York, New York 10010
Attention: Agency Group
Telephone No.: (212) 325-9940
Facsimile No.: (212) 325-
Exhibit H-1-A
Page 42
(c) if to any Bank Creditor (other than the Collateral Agent), at
such address as such Bank Creditor shall have specified in the
Credit Agreement; and
(d) if to any other Secured Creditor, (x) to the Authorized
Representative for such Secured Creditor or (y) if there is no
such Authorized Representative, at such address as such
Secured Creditor shall have specified in writing to each
Assignor and the Collateral Agent;
or at such other address as shall have been furnished in writing by any Person
described above to the party required to give notice hereunder.
11.2 Waiver; Amendment; Notice of Acceleration. (a) None of the terms
and conditions of this Agreement may be changed, waived, modified or varied in
any manner whatsoever unless in writing duly signed by each Assignor directly
and adversely affected thereby and the Collateral Agent (with the consent of the
Required Secured Creditors); provided, that (i) additional Assignors may be
added as parties hereto from time to time in accordance with Section 11.13
without the consent of any other Assignor or of the Secured Creditors, (ii)
Assignors may be removed as parties hereto from time to time in accordance with
Section 11.14 without any consent of any other Assignor or of the Secured
Creditors and (iii) any change, waiver, modification or variance affecting the
rights and benefits of any Class (as defined below), with outstanding
Obligations of the respective Class secured hereby at such time, of Secured
Creditors (and not all Secured Creditors in a like or similar manner) shall
require the written consent of the Requisite Creditors (as defined below) of
such affected Class; provided further, however, that notwithstanding anything to
the contrary provided in clause (iii) of the immediately preceding proviso, (x)
the Required Secured Creditors may agree to modifications to this Agreement for
the purpose, among other things, of securing additional extensions of credit
(including, without limitation, pursuant to the Credit Agreement or any
refinancing or extension thereof) and adding new creditors as "Secured
Creditors" hereunder (either as part of an existing Class of Secured Creditors
or as a newly created Class) and such changes shall not require the written
consent of the Requisite Creditors of the various Classes, so long as (I) such
extensions (and resulting addition) do not otherwise give rise to an express
violation of the terms of the Credit Agreement, (II) in the case of any such
extensions under the Credit Agreement or any Interest Rate Protection Agreement
or Other Hedging Agreement, such extensions (and the obligations evidenced
thereby) constitute ["Senior Debt" and/or "Guarantor Senior Debt"] ["Pari Passu
Debt" and/or "Guarantor Pari Passu Debt"] under the Senior [Subordinated]
Secured Notes Indenture and (III) in the case of any other extensions not
described in preceding clause (II), such extensions (and resulting addition) do
not otherwise give rise to an express violation of the terms of the Senior
[Subordinated] Secured Notes Documents and (y) said clause (iii) shall not apply
to any release of Collateral or any Assignor (or the termination of this
Agreement) effected in accordance with the requirements of Section 11.8 or 11.14
of this Agreement, as the case may be. For the purpose of this Agreement, the
term "Class" shall mean each class of Secured Creditors with outstanding
Obligations secured hereby at such time, i.e., whether (w) the Non-Tranche D
Bank Creditors as holders of the Non-Tranche D Credit Document Obligations, (x)
Tranche D Banks as holders of the Tranche D Obligations, (y) the Other Creditors
as holders of the Other Obligations or (z) the Senior [Subordinated] Secured
Notes Creditor (with respect to the Senior [Subordinated] Secured Notes
Obligations). For the purpose of this Agreement, the term "Requisite Creditors"
of any Class shall mean each of (w) with respect to the Non-Tranche D Credit
Document Obligations, the Required Banks (for this purpose determined after
giving
Exhibit H-1-A
Page 43
effect to the last sentence of the definition thereof as if the assignment
referred to therein had occurred), (x) with respect to the Tranche D
Obligations, the Required Tranche D Banks, (y) with respect to the Other
Obligations, the holders of at least a majority of all Other Obligations
outstanding from time to time under the Interest Rate Protection Agreements or
Other Hedging Agreements (as determined by the Collateral Agent in such
reasonable manner as is acceptable to it) and (z) with respect to the Senior
[Subordinated] Secured Notes Obligations, the Senior [Subordinated] Secured
Notes Creditor acting at the direction of the holders of at least a majority of
all Senior [Subordinated] Secured Notes Obligations outstanding from time to
time.
(b) Each Secured Creditor (other than an Other Creditor), by its
acceptance of the benefits of this Agreement, hereby authorizes its Authorized
Representative to, and each such Authorized Representative (by such
authorization) hereby agrees to, deliver to the Collateral Agent and each other
Authorized Representative:
(i) in the case of the Administrative Agent, prompt written
notice of the acceleration of any Credit Document Obligations (such
notice to be provided in the same manner and substantially
contemporaneously with any notice provided to the U.S. Borrower),
although the failure to deliver any such notice shall not affect the
validity of such acceleration; and
(ii) in the case of the Senior [Subordinated] Secured Notes
Trustee, prompt written notice of the acceleration of the Senior
[Subordinated] Secured Notes Obligations (such notice to be provided in
the same manner and substantially contemporaneously with any notice
provided to the U.S. Borrower), although the failure to deliver any
such notice shall not affect the validity of such acceleration.
11.3 Obligations Absolute. The obligations of each Assignor hereunder
shall remain in full force and effect without regard to, and shall not be
impaired by, (a) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of such Assignor; (b) any
exercise or non-exercise, or any waiver of, any right, remedy, power or
privilege under or in respect of this Agreement or any other Secured Debt
Agreement; (c) any renewal, extension, amendment or modification of or addition
or supplement to or deletion from any Secured Debt Agreement or any security for
any of the Obligations; (d) any waiver, consent, extension, indulgence or other
action or inaction under or in respect of any such agreement or instrument
including, without limitation, this Agreement; (e) any furnishing of any
additional security to the Collateral Agent or its assignee or any acceptance
thereof or any release of any security by the Collateral Agent or its assignee;
or (f) any limitation on any party's liability or obligations under any such
instrument or agreement or any invalidity or unenforceability, in whole or in
part, of any such instrument or agreement or any term thereof; whether or not
any Assignor shall have notice or knowledge of any of the foregoing. The rights
and remedies of the Collateral Agent herein provided are cumulative and not
exclusive of any rights or remedies which the Collateral Agent would otherwise
have.
11.4 Successors and Assigns. This Agreement shall be binding upon each
Assignor and its successors and assigns and shall inure to the benefit of the
Collateral Agent and its successors and assigns; provided, that no Assignor may
transfer or assign any or all of its rights or obligations hereunder without the
prior written consent of the Collateral Agent (with the
Exhibit H-1-A
Page 44
consent of the Required Secured Creditors). Any Person that becomes a Secured
Creditor after the Fifth Amendment Effective Date by its acceptance of any Note,
any Senior [Subordinated] Secured Note or any Interest Rate Protection Agreement
or the benefits of this Agreement, as the case may be, shall be bound by the
terms hereof; it being understood that, as between the Senior [Subordinated]
Secured Noteholders and the Senior [Subordinated] Secured Notes Creditor, no
Senior [Subordinated] Secured Noteholder shall have any right to give any
direction to the Collateral Agent with respect to any Collateral or take any
action or exercise any right of a Secured Creditor under this Agreement or any
other Security Documents, with all such directions, actions or rights to be
given, taken or exercised, as the case may be, by the Senior [Subordinated]
Secured Notes Creditor acting for the benefit of the holders of the Senior
[Subordinated] Secured Notes Obligations, provided that nothing contained in the
preceding clause shall be construed to limit the agreements set forth in the
last sentence of Section 8.1. All agreements, statements, representations and
warranties made by each Assignor herein or in any certificate or other
instrument delivered by such Assignor or on its behalf under this Agreement
shall be considered to have been relied upon by the Secured Creditors and shall
survive the execution and delivery of this Agreement and each other Secured Debt
Agreement regardless of any investigation made by the Secured Creditors or on
their behalf.
11.5 Headings Descriptive. The headings of the several sections of this
Agreement are inserted for convenience only and shall not in any way affect the
meaning or construction of any provision of this Agreement.
11.6 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY
THE LAW OF THE STATE OF NEW YORK.
11.7 Assignor's Duties. It is expressly agreed, anything herein
contained to the contrary notwithstanding, that each Assignor shall remain
liable to perform all of the obligations, if any, assumed by it with respect to
the Collateral and the Collateral Agent shall not have any obligations or
liabilities with respect to any Collateral by reason of or arising out of this
Agreement, nor shall the Collateral Agent be required or obligated in any manner
to perform or fulfill any of the obligations of each Assignor under or with
respect to any Collateral.
11.8 Termination; Release. (a) After the Termination Date (as defined
below), this Agreement shall terminate (provided that all indemnities set forth
herein including, without limitation, in Section 9.1 hereof shall survive such
termination) and the Collateral Agent, at the request and expense of the
respective Assignor, will promptly execute and deliver to such Assignor a proper
instrument or instruments (including Uniform Commercial Code termination
statements on form UCC-3) acknowledging the satisfaction and termination of this
Agreement, and will duly assign, transfer and deliver to such Assignor (without
recourse and without any representation or warranty) such of the Collateral as
may be in the possession of the Collateral Agent and as has not theretofore been
sold or otherwise applied or released pursuant to this Agreement. As used in
this Agreement, "Termination Date" shall mean the earlier to occur of (x) the
date upon which (i) the Non-Senior [Subordinated] Secured Notes Obligations
Termination Date shall have occurred and (ii) if (but only if) an Event of
Default under, and as defined in, the Senior [Subordinated] Secured Notes
Indenture exists on the Non-Senior
Exhibit H-1-A
Page 45
[Subordinated] Secured Notes Obligations Termination Date, all Senior
[Subordinated] Secured Notes Obligations (other than those arising from
indemnities for which no claim has been made) then owing have been indefeasibly
paid in full (or defeased in accordance with the terms of the Senior
[Subordinated] Secured Notes Indenture) and (y) that date upon which the
Required Secured Creditors shall have released all of the Collateral pledged
hereunder in accordance with the requirements of Section 11.8(b) or (c) below.
(b) In the event that any part of the Collateral is sold or otherwise
disposed of in connection with a sale or other disposition (other than a sale or
disposition to any Assignor or any Subsidiary thereof) which (x) at all times
prior to the Credit Document Obligations Termination Date, is permitted by the
Credit Agreement and (y) does not violate the provisions of any other Secured
Debt Agreement, then, so long as the U.S. Borrower certifies to the Collateral
Agent that, at the time of the respective release and immediately after giving
effect thereto (and to the sale or other disposition of the respective
Collateral), either (x) no Obligations are or will be then due and payable or
(y) all Obligations which will then be due and payable as a result of such sale
or disposition shall be paid on such date in accordance with the requirements of
the respective Secured Debt Agreements, the Collateral Agent, at the request and
expense of the respective Assignor, will (i) duly assign, transfer and deliver
to such Assignor (without recourse and without any representation or warranty)
such of the Collateral as is then being (or has been) so sold or disposed of and
has not theretofore been released pursuant to this Agreement and (ii) execute
such releases and discharges in respect of such Collateral as is then being (or
has been) so sold or disposed of as such Assignor may reasonably request;
provided however, that if (but only if) an Event of Default under, and as
defined in, the Senior [Subordinated] Secured Notes Indenture exists on the date
of such sale or other disposition and such date is also the Non-Senior
[Subordinated] Secured Notes Obligations Termination Date, only that portion of
the Collateral sold or otherwise disposed of in order to repay in full the
Credit Document Obligations and/or the Other Obligations on such date shall be
(and shall be required to be) released pursuant to this Section 11.8(b) until
such Event of Default (and all other Events of Default under, and as defined in,
the Senior [Subordinated] Secured Notes Indenture) shall have been cured or
otherwise waived by the Required Secured Creditors (determined after giving
effect to the Non-Senior [Subordinated] Secured Notes Obligations Termination
Date), at which time such remaining Collateral shall be released as otherwise
provided above (without regard to this proviso).
(c) In addition to any release of Collateral pursuant to preceding
clauses (a) and (b), all or any portion of the Collateral hereunder shall be
released by the Collateral Agent at the written direction of, or with the
written consent of, the Required Secured Creditors (which may be, but shall not
be required to be, granted in connection with a repayment of all, or any
specified portion, of the Obligations owing to such Secured Creditors) and, in
connection therewith, the Collateral Agent, at the request and expense of the
respective Assignor, will (i) duly assign, transfer and deliver to such Assignor
(without recourse and without any representation or warranty) such of the
Collateral as is then being (or has been) so released and has not theretofore
been released pursuant to this Agreement and (ii) execute such releases and
discharges in respect of such Collateral as is then being (or has been) so
released as such Assignor may reasonably request.
Exhibit H-1-A
Page 46
(d) At any time that the respective Assignor desires that the
Collateral Agent assign, transfer and deliver Collateral (and releases therefor)
as provided in the foregoing Section 11.8(a), (b) or (c), it shall deliver to
the Collateral Agent a certificate signed by an Authorized Officer stating that
the release of the respective Collateral is permitted pursuant to such Section
11.8(a), (b) or (c), as the case may be. If requested by the Collateral Agent
(although the Collateral Agent shall have no obligation to make any such
request), the relevant Assignor shall furnish appropriate legal opinions (from
counsel, which may be in-house counsel, reasonably acceptable to the Collateral
Agent) to the effect set forth in the immediately preceding sentence. Upon any
release of Collateral pursuant to Section 11.8(a), (b) or (c), none of the
Secured Creditors shall have any continuing right or interest in such
Collateral, or the proceeds thereof; provided however, that if (but only if) an
Event of Default under, and as defined in, the Senior [Subordinated] Secured
Notes Indenture exists on the date of such release and such date is also the
Non-Senior [Subordinated] Secured Notes Obligations Termination Date, any
proceeds of any Collateral sold or otherwise disposed of on such date and not
used to repay in full the Credit Document Obligations and/or the Other
Obligations shall remain subject to the pledge hereunder (and continue to
constitute Collateral) until such Event of Default (and all other Events of
Default under, and as defined in, the Senior [Subordinated] Secured Notes
Indenture) shall have been cured or otherwise waived by the Required Secured
Creditors (determined after giving effect to the Non-Senior [Subordinated]
Secured Notes Obligations Termination Date), at which time any continuing right
or interest in such Collateral shall terminate.
(e) The Collateral Agent shall have no liability whatsoever to any
other Secured Creditor as the result of any release of Collateral by it in
accordance with (or which the Collateral Agent in the absence of gross
negligence or willful misconduct believes to be in accordance with) this Section
11.8.
(f) Without limiting the foregoing provisions of this Section 11.8, to
the extent applicable following the qualification of the Senior [Subordinated]
Notes Indenture under the Trust Indenture Act, (i) the Assignors shall comply
with Section 314(d) of the Trustee Indenture Act in connection with the release
of property or Liens hereunder(8) and (ii) the parties hereto agree that if any
amendments to this Agreement or any other Security Documents are required in
order to comply with the provisions of the Trust Indenture Act, such parties
shall cooperate and act in good faith to effect such amendments as promptly as
practicable.
11.9 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the U.S. Borrower and
the Collateral Agent.
- ----------
(8) O'Sullivan to confirm to White & Case that the requirements of said
Section 314(d) regarding substitute collateral do not in any way conflict
with the pledge requirements hereunder (i.e., if a sale occurs and the
consideration is part cash and part seller paper, the substitute
collateral subject to pledge in favor of the Trustee may not be of
equivalent value).
Exhibit H-1-A
Page 47
11.10 The Collateral Agent. The Collateral Agent will hold in
accordance with this Agreement all items of the Collateral at any time received
under this Agreement. It is expressly understood and agreed that the obligations
of the Collateral Agent as holder of the Collateral and interests therein and
with respect to the disposition thereof, and otherwise under this Agreement, are
only those expressly set forth in this Agreement and Annex J hereto. The
Collateral Agent shall act hereunder on the terms and conditions set forth in
Section 12 of the Credit Agreement and in Annex J hereto, the terms of which
shall be deemed incorporated herein by reference as fully as if the same were
set forth herein in their entirety. In the event that any provision set forth in
Section 12 of the Credit Agreement in respect of the Collateral Agent conflicts
with any provision set forth in Annex J hereto, the provisions of Annex J hereto
shall govern (except that the Banks shall remain obligated to indemnify the
Collateral Agent pursuant to Section 12 of the Credit Agreement, to the extent
the Collateral Agent is not indemnified by Secured Creditors pursuant to Annex
J).
11.11 Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
11.12 Limited Obligations. It is the desire and intent of each Assignor
and the Secured Creditors that this Agreement shall be enforced against each
Assignor to the fullest extent permissible under the laws and public policies
applied in each jurisdiction in which enforcement is sought. Notwithstanding
anything to the contrary contained herein, in furtherance of the foregoing, it
is noted that the obligations of each U.S. Subsidiary Guarantor constituting an
Assignor have been limited as provided in the U.S. Subsidiaries Guaranty.
11.13 Additional Assignors. It is understood and agreed that any
Subsidiary of [Holdings] [the U.S. Borrower] that is required to become a party
to this Agreement after the date hereof pursuant to the requirements of the
Credit Agreement or the Senior [Subordinated] Secured Notes Indenture shall
become an Assignor hereunder by (x) executing a counterpart hereof and/or an
assumption agreement, in each case in form and substance satisfactory to the
Collateral Agent, (y) delivering supplements to Annexes A through F hereto and
Annexes I, K, L, M and N hereto, as are necessary to cause such Annexes to be
complete and accurate with respect to such additional Assignor on such date and
(z) taking all actions as specified in this Agreement, the Credit Agreement and
the Senior [Subordinated] Secured Notes Indenture, in each case with all
documents required above to be delivered to the Collateral Agent and with all
documents and action required above to be taken to the reasonable satisfaction
of the Collateral Agent.
11.14 Release of Assignors . If at any time all of the equity interests
of any Assignor owned by [Holdings] [the U.S. Borrower] and its Subsidiaries are
sold to any Person (other than [Holdings] [the U.S. Borrower] or any of its
Subsidiaries) in a transaction which (x) at all times prior to the Credit
Document Obligations Termination Date, is permitted pursuant to the Credit
Agreement and (y) does not violate the terms of any other Secured Debt Agreement
then in effect, then, at the request and expense of the U.S. Borrower, the
respective Assignor shall be released as an Assignor pursuant to this Agreement
(and the Collateral Agent is
Exhibit H-1-A
Page 48
authorized and directed to execute and deliver such instruments of release as
are reasonably satisfactory to it). At any time that the U.S. Borrower desires
that an Assignor be released from this Agreement as provided in this Section
11.14, the U.S. Borrower shall deliver to the Collateral Agent a certificate
signed by an Authorized Officer of the U.S. Borrower stating that the release of
the respective Assignor is permitted pursuant to this Section 11.14. If
requested by the Collateral Agent (although the Collateral Agent shall have no
obligation to make any such request), the U.S. Borrower shall furnish legal
opinions (from counsel, which may be in-house counsel, reasonably acceptable to
the Collateral Agent) to the effect set forth in the immediately preceding
sentence. The Collateral Agent shall have no liability whatsoever to any other
Secured Creditor as a result of the release of any Assignor by it in accordance
with (or which it in the absence of gross negligence or willful misconduct
believes to be in accordance with) this Section 11.14.
11.15 No Third Party Beneficiaries. This Agreement is entered into
solely for the benefit of the parties hereto and their respective successors and
assigns and for the benefit of the Secured Creditors from time to time and their
respective successors and assigns and, except for the Secured Creditors and
their successors and assigns, there shall be no third party beneficiaries
hereof, nor shall any Person other than the parties hereto and their respective
successors and assigns, and the Secured Creditors and their respective
successors and assigns, be entitled to enforce the provisions hereof or have any
claims against any party hereto (or any Secured Creditor) or their successors
and assigns arising from, or under, this Agreement.
ARTICLE XII
SPECIAL AGREEMENTS AND ACKNOWLEDGEMENTS BY SECURED CREDITORS
By their acceptance of their respective Obligations and the benefits of this
Agreement, the following agreements and acknowledgements are made by the Senior
[Subordinated] Secured Creditor (and its successors and assigns) for the benefit
of the Secured Creditors holding Non-Senior [Subordinated] Secured Notes
Obligations (or, in the case of Sections 12.1(b), 12.2(b), 12.7 [and 12.8](9),
all of the Secured Creditors for the benefit of the other Secured Creditors):
12.1 Priorities With Respect to Collateral, etc . (a) The liens of the
Non-Tranche D Bank Creditors, the Tranche D Banks, the Senior [Subordinated]
Secured Notes Creditor and the Other Creditors in the Collateral shall be
subject to: [(x)] the priorities for distributions in accordance with the terms
of Section 8.4 (including, without limitation, in the case of (I) any
distribution of any Collateral upon any bankruptcy, arrangement, receivership,
assignment for the benefit of creditors or any other action or proceeding
involving the readjustment of the obligations and indebtedness of either
Borrower or their respective Subsidiaries, or the application of any Collateral
to the payment thereof and (II) any distribution of the Collateral upon the
liquidation or dissolution of either Borrower or their respective Subsidiaries,
or the winding up of the assets or business of either Borrower or their
respective Subsidiaries)[and (y)
- ----------
(9) Bracketed text to be included in the event a Qualified Exchange
Transaction is to be consummated.
Exhibit H-1-A
Page 49
the express subordination provisions (and only those subordination provisions)
contained in the Senior Subordinated Secured Notes Indenture (which provisions
shall apply in accordance with the express terms thereof)](10). The foregoing
shall be effective at all times prior to the Termination Date, notwithstanding:
(i) the initiation of any bankruptcy, moratorium, reorganization or other
insolvency proceeding with respect to any Credit Party; (ii) the priorities
which would otherwise result from the order of creation, attachment or
perfection of any such lien; (iii) the taking of possession of any of the
Collateral by the Collateral Agent, any Bank Creditor, the Senior [Subordinated]
Secured Notes Creditor or any Other Creditor; (iv) the filing of any financing
statement or the recording of any mortgage or other instrument in any recording
office; (v) the order in which any of the Non-Tranche D Credit Document
Obligations, Tranche D Obligations, Other Obligations or Senior [Subordinated]
Secured Notes Obligations is created; or (vi) whether any such lien is now
perfected, hereafter ceases to be perfected, is avoidable by any bankruptcy
trustee or otherwise is set aside, invalidated or lapses; and shall continue in
full force and effect until the Termination Date.
(b) Each Secured Creditor, by its acceptance of the benefits of the
Security Agreement, hereby agrees for the benefit of the other Secured Creditors
that, except as otherwise specifically provided in the immediately succeeding
sentence, to the extent any additional or substitute collateral for any of the
Obligations of the type covered by the Security Agreement is delivered by
[Holdings] [the U.S. Borrower] or any of its Subsidiaries to or for the benefit
of any Secured Creditor, such collateral shall be subject to the provisions of
the Security Agreement and, in the event such collateral constitutes "Excluded
Senior [Subordinated] Secured Notes Collateral", be subject to the pledge
limitations for Senior [Subordinated] Secured Notes Obligations set forth in the
Security Agreement.
12.2 Right to Contest; etc. (a) The Senior [Subordinated] Secured Notes
Creditor agrees for itself (and for the Senior [Subordinated] Secured
Noteholders), and their respective successors and assigns, (i) not to contest or
support any other Person in contesting, in any proceeding, including, without
limitation, any bankruptcy, insolvency or liquidation proceeding, the priority,
validity or enforceability of the Liens held by the Bank Creditors or the Other
Creditors or the Collateral Agent (on behalf of such Secured Creditors) in the
Collateral or the priority, validity or enforceability of the Obligations (so
long as the Liens held by the Collateral Agent (in favor of the Senior
[Subordinated] Secured Notes Creditor) in the Collateral (other than the
Excluded Collateral), and the Senior [Subordinated] Secured Notes Obligations
owing to the Senior [Subordinated] Secured Notes Creditors, are not subject to a
contest initiated or supported by the Bank Creditors or the Other Creditors at
such time), or the provisions of this Section 12 and (ii) that the Senior
[Subordinated] Secured Notes Obligations are not (and shall not be construed to
be) secured by any Excluded Collateral.
(b) Each Secured Creditor (other than the Senior [Subordinated] Secured
Notes Creditor) agrees for itself, and its successors and assigns, not to
contest or support any other Person in contesting, in any proceeding, including,
without limitation, any bankruptcy, insolvency or liquidation proceeding, the
validity or enforceability of the Liens held by the
- ----------
(10) To be included if a Qualified Exchange Transaction is to be consummated.
Exhibit H-1-A
Page 50
Senior [Subordinated] Secured Notes Creditor or the Collateral Agent (on behalf
of the Senior [Subordinated] Secured Notes Creditor) in any Collateral (other
than Excluded Collateral) or the validity or enforceability of the Senior
[Subordinated] Secured Notes Obligations, in each case so long as the Liens held
by the Bank Creditors, the Other Creditors or the Collateral Agent (on behalf of
such Secured Creditors) in the Collateral is, and the relevant Obligations owing
to such Secured Creditors are, valid and enforceable (and not subject to a
contest initiated or supported by the Senior [Subordinated] Secured Notes
Creditor or any Senior [Subordinated] Secured Noteholder) at such time.
(c) Each Secured Creditor agrees for itself, and for its successors and
assigns, that neither the Collateral Agent nor the Required Secured Creditors
(in directing the Collateral Agent to take any action with respect to the
Collateral) shall have any duty or obligation to realize first upon any type of
Collateral (including Excluded Collateral) or to sell, dispose of or otherwise
liquidate all or any portion of the Collateral in any manner that would maximize
the return to any Class of Secured Creditors holding Obligations of any type
(whether Credit Document Obligations, Other Obligations or Senior [Subordinated]
Secured Notes Obligations), notwithstanding that the order and timing of any
such realization, sale, disposition or liquidation may affect the amount of
proceeds actually received by such Class of Secured Creditors from such
realization, sale, disposition or liquidation.
12.3 Payment Invalidated. In the event that any of the Non-Senior
[Subordinated] Secured Notes Obligations shall be paid in full and subsequently,
for whatever reason (including, but not limited to, an order or judgment for
disgorgement of a preference under Title 11 of the United Stated Code, or any
similar law, or the settlement of any claim in respect thereof), formerly paid
or satisfied Non-Senior [Subordinated] Secured Notes Obligations become unpaid
or unsatisfied, the terms and conditions of this Section 12 shall be fully
applicable thereto until all such Non-Senior [Subordinated] Secured Notes
Obligations are again paid in full.
12.4 Right to Amend. Etc. As between the Senior [Subordinated] Secured
Notes Creditor and the other Secured Creditors (including, without limitation,
the Banks), it is agreed that the Secured Creditors (excluding the Senior
[Subordinated] Secured Notes Creditor in its capacity as such) may at any time
and from time to time, in their sole discretion, and without any obligation to
give any notice or receive any consent from the Senior [Subordinated] Secured
Notes Creditor in its capacity as such, (i) change the manner, place or terms of
payment, or change or extend the time of payment of, or renew, alter, refinance,
increase or add to the Non-Senior [Subordinated] Secured Notes Obligations, (ii)
obtain, release, or dispose of any Collateral for the Non-Senior [Subordinated]
Secured Notes Obligations (subject, however, to Sections 11.2 and 11.8), or
(iii) amend or supplement in any manner this Agreement and the other Credit
Documents or any other agreements or instruments evidencing, securing or
relating to the Non-Senior [Subordinated] Secured Notes Obligations (subject,
however, to Section 13.12 of the Credit Agreement and Section 11.2 hereof), and
the provisions of this Section 12 shall continue in full force and effect with
respect to all such Non-Senior [Subordinated] Secured Notes Obligations.
12.5 Creation of Future Obligations. All of the Non-Senior
[Subordinated] Secured Notes Obligations shall be deemed to have been funded by
the relevant Secured Creditors in reliance upon the agreements contained in this
Section 12, and the Senior
Exhibit H-1-A
Page 51
[Subordinated] Secured Notes Creditor (i) expressly waives notice of acceptance
of the agreements set forth herein, notice of reliance thereon and any other
agreements and notice of the creation of any Non-Senior [Subordinated] Secured
Notes Obligations after the Fifth Amendment Effective Date, (ii) agrees that the
Secured Creditors shall be entitled to rely upon the agreements set forth herein
at all times in creating Non-Senior [Subordinated] Secured Notes Obligations and
(iii) agrees that (w) additional extensions of credit may be made pursuant to
the Credit Agreement, with the consent of the Required Banks in accordance with
Section 13.12 of the Credit Agreement and any other Banks whose consent is
required thereunder, (x) additional Credit Document Obligations resulting
therefrom may be designated as Non-Senior [Subordinated] Secured Notes
Obligations (and shall be entitled to such priorities with respect to the
Collateral as may be agreed amongst the Required Banks), (y) no further consent
of the Senior [Subordinated] Secured Notes Creditor shall be required in
connection therewith (so long as the incurrence of such Indebtedness under the
Credit Agreement is not expressly prohibited by the Senior [Subordinated]
Secured Notes Indenture) and (z) the provisions of this Section 12 (and Section
8.4) shall be fully applicable to the Credit Document Obligations so created in
the future.
12.6 Effectiveness. The provisions in this Section 12 (and Section 8.4)
shall be effective both before and after the commencement of a bankruptcy,
insolvency, liquidation or similar proceeding. All references in this Agreement
to [Holdings] [the U.S. Borrower] or any of its Subsidiaries shall include such
entity as debtor in possession or any receiver or trustee for such entity.
12.7 Further Assurances. Each Secured Creditor agrees to take such
further action and shall execute and deliver to the Administrative Agent, the
Collateral Agent and the other Secured Creditors such additional documents and
instruments (in recordable form, if requested) as the Administrative Agent, the
Collateral Agent or such other Secured Creditors may reasonably request to
effectuate the terms of, and the priorities established by, this Section 12. In
addition, if in connection with any refinancing or replacement of indebtedness
under the Credit Agreement, including as contemplated by the recitals hereof,
the lenders or holders of the refinancing or replacement indebtedness require
that such indebtedness be secured pursuant to separate security documents, each
Secured Creditor agrees to take such actions and execute and deliver such
documents, agreements and instruments as may be necessary or advisable in order
to effect and maintain the relative priorities and rankings of security
interests, rights, remedies and payments as contemplated hereby, including,
without limitation, through intercreditor and subordination agreements. The
Collateral Agent, for its part, agrees that it will from time to time upon the
reasonable request of any Secured Creditor (and at the expense of the
Assignors), furnish to such Secured Creditors copies of financing statements
covering the Collateral which have been filed and such other information with
respect to the Collateral in the possession of the Collateral Agent as may
reasonably be requested by such Secured Creditor from time to time.
[12.8 Nature of Senior Secured Notes Obligations. The Secured Creditors
acknowledge and agree that the Senior Secured Notes Obligations constitute
"senior indebtedness" of the U.S. Borrower and the various Subsidiary
Guarantors, which is not subordinate in right of payment to any other
Indebtedness of the U.S. Borrower or such Subsidiary Guarantors, as the case may
be, it being understood however nothing in this Section
Exhibit H-1-A
Page 52
12.8 shall limit or modify the agreements contained in Section 8.4 or elsewhere
in this Section 12 with respect to the priorities as to distributions of
Collateral.](11)"
* * *
- ----------
(11) Bracketed text to be included in the event a Qualified Exchange
Transaction is not to be consummated.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.
3801 Corporex Park Drive QUALITY DISTRIBUTION, INC.
Tampa, FL 33619 (f/k/a MTL, INC.),
as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive LAKESHORE LEASING, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive MEXICO INVESTMENTS, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive CHEMICAL LEAMAN CORPORATION,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive CHEMICAL PROPERTIES, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive CAPACITY MANAGEMENT SYSTEMS, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
150 E. Pennsylvania Ave. #127 ENVIROPOWER, INC.,
Downington, PA 19335 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive PICKERING WAY FUNDING CORP.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
150 E. Pennsylvania Ave. #127 POWER PURCHASING, INC.,
Downington, PA 19335 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
150 E. Pennsylvania Ave. #127 AMERICAN TRANSINSURANCE GROUP, INC.,
Downington, PA 19335 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive CHEMICAL LEAMAN TANK LINES, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive FLEET TRANSPORT COMPANY, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive QUALA SYSTEMS, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive CLT SERVICES, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive QSI SERVICES, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
3801 Corporex Park Drive TRANSPLASTICS, INC.,
Tampa, FL 336190 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
Bank of America Center MTL OF NEVADA,
101 Convention Center Drive as a Pledgor
Suite 850
Las Vegas, NV 89109
By: /s/ Leo Massey
--------------------------------
Title: President
3801 Corporex Park Drive QUALITY CARRIERS, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
Bank of America Center CLTL OF NEVADA,
101 Convention Center Dr. #850 as a Pledgor
Las Vegas, NV 89109
By: /s/ Leo Massey
--------------------------------
Title: President
3801 Corporex Park Drive CLM, INC.,
Tampa, FL 33619 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
150 E. Pennsylvania Ave. #127 LLI, INC.
Downington, PA 19335 as a Pledgor
By: /s/ Thomas Finkbiner
--------------------------------
Title: President
CREDIT SUISSE FIRST BOSTON,
as Collateral Agent, as Assignee
By: /s/ Robert Hetu
-----------------------------------------
Title: Director
By: /s/ Ian W. Nalitt
-----------------------------------------
Title: Associate