Exhibit 4(b)
SECURITY AGREEMENT
dated as of
November 30, 2001
among
UNITED STATES STEEL LLC
and
JPMORGAN CHASE BANK,
as Collateral Agent
TABLE OF CONTENTS
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EXHIBITS:
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Exhibit A Perfection Certificate
SECURITY AGREEMENT
AGREEMENT dated as of November 30, 2001 among United States Steel LLC (the
"Borrower") and JPMorgan Chase Bank, as Collateral Agent.
WHEREAS, the Borrower has entered into the Credit Agreement described in
Section hereof, pursuant to which the Borrower has borrowed funds and intends to
continue to borrow funds and obtain letters of credit for the purposes set forth
therein;
WHEREAS, the Borrower is willing to secure (i) its obligations under the
Credit Agreement and the other Financing Documents and (ii) certain other
obligations, by granting Liens on certain of its assets to the Collateral Agent
as provided in the Security Documents;
WHEREAS, the Lenders are willing to make loans and issue or participate in
Letters or Credit under the Credit Agreement described in Section hereof on the
terms set forth therein if the foregoing obligations of the Borrower are secured
as described above;
WHEREAS, upon any foreclosure or other enforcement of the Security
Documents, the net proceeds of the relevant Collateral are to be received by or
paid over to the Collateral Agent and applied as provided in Section hereof;
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows: .
(a) Terms Defined in Credit Agreement. Terms defined in the Credit
Agreement and not otherwise defined in subsection or have, as used herein, the
respective meanings provided for therein.
(b) Terms Defined in UCC. As used herein, each of the following terms has
the meaning specified in the UCC:
Term UCC
Account 9-102
Authenticate 9-102
Chattel Paper 9-102
General Intangibles 9-102
Instrument 9-102
Inventory 9-102
Letter-of-Credit Right 9-102
(c) Additional Definitions. The following additional terms, as used herein,
have the following meanings:
"Additional Secured Obligations" means the Secured Derivative Obligations.
"Administrative Agent" means JPMorgan Chase Bank, in its capacity as
administrative agent under the Loan Documents, and its successors in such
capacity.
"Article 9" means Article 9 of the Uniform Commercial Code as set forth in
the 1998 Official Text thereof; provided that, when used with respect to any
jurisdiction on or after the date when such Article 9 (with or without local
changes therein) first becomes effective in such jurisdiction, "Article 9"
refers to Article 9 as in effect in such jurisdiction from time to time.
"Blocked Account Agreement" means, with respect to any account, a blocked
account agreement in favor of the Collateral Agent, all in form and substance
satisfactory to the Administrative Agent, the Collateral Agent and the
Co-Collateral Agent.
"Borrower" means United States Steel LLC, a Delaware limited liability
company, and its successors. "Cash Collateral Account" has the meaning set forth
in Section .
"Collateral" means all property, whether now owned or hereafter acquired,
on which a Lien is granted or purports to be granted to the Collateral Agent
pursuant to the Security Documents.
"Collateral Agent" means JPMorgan Chase Bank, in its capacity as Collateral
Agent for the Secured Parties under the Security Documents, and its successors
in such capacity.
"Contracts" means all contracts for the sale, lease, exchange or other
disposition of Inventory, whether or not performed and whether or not subject to
termination upon a contingency or at the option of any party thereto.
"Credit Agreement" means the Credit Agreement dated as of November 30, 2001
among the Borrower, the Lenders party thereto, the LC Issuing Banks party
thereto, the Swingline Lender party thereto, the Administrative Agent and
General Electric Capital Corporation, as Documentation Agent and Co-Collateral
Agent, as amended or restated from time to time in accordance with the terms
thereof.
"Derivative Obligations" of any Person means all obligations of such Person
in respect of any rate swap transaction, basis swap, forward rate transaction,
commodity swap, commodity option, equity or equity index swap, equity or equity
index option, bond option, interest rate option, foreign exchange transaction,
cap transaction, floor transaction, collar transaction, currency swap
transaction, cross-currency rate swap transaction, currency option or any other
similar transaction (including any option with respect to any of the foregoing
transactions) or any combination of the foregoing transactions.
"Effective Date" means the Effective Date as defined in the Credit
Agreement.
"Eligible Transferee" means (a) a special-purpose company created and used
solely for purposes of effecting a Receivables Financing, whether or not a
Subsidiary of the Borrower, or (b) any other Person which is not a Subsidiary of
the Borrower.
"Event of Default" means any Event of Default as defined in the Credit
Agreement and any similar event with respect to any Additional Secured
Obligation that permits the acceleration of the maturity thereof (or an
equivalent remedy).
"Existing Receivables SPV Accounts" has the meaning set forth in Section
5(b).
"First Secured Derivative Obligations" means the Secured Derivative
Obligations to the extent (but only to the extent) that the aggregate
Mark-to-Market Value of all such Secured Derivative Obligations does not exceed
$25,000,000.
"Lien Grantor" means the Borrower.
"Liquid Investment" means (i) direct obligations of the United States or
any agency thereof, (ii) obligations guaranteed by the United States or any
agency thereof, (iii) time deposits and money market deposit accounts issued by
or guaranteed by or placed with a Lender, and (iv) fully collateralized
repurchase agreements for securities described in clause (i) or (ii) above
entered into with a Lender, provided in each case that such Liquid Investment
(x) matures within 30 days after it is first included in the Collateral and (y)
is in a form, and is issued and held in a manner, that in the reasonable
judgment of the Collateral Agent permits appropriate measures to have been taken
to perfect security interests therein.
"Liquidated Secured Obligation" means at any time any Secured Obligation
(or portion thereof) that is not an Unliquidated Secured Obligation at such
time.
"Mark-to-Market Value" means, at any date with respect to any Derivative
Obligation, the termination value thereof (on a net basis), calculated as if
such Derivative Obligation had been terminated on such date by reason of a
default on the part of the Borrower.
"Opinion of Counsel" means a written opinion of legal counsel (who may be
counsel to the Lien Grantor or other counsel, in either case approved by the
Administrative Agent in a writing delivered to the Collateral Agent, which
approval shall not be unreasonably withheld) addressed and delivered to the
Collateral Agent.
"own" refers to the possession of sufficient rights in property to grant a
security interest therein as contemplated by UCC Section 9-203, and "acquire"
refers to the acquisition of any such rights.
"Perfection Certificate" means a certificate from the Lien Grantor
substantially in the form of Exhibit A, completed and supplemented with the
schedules contemplated thereby to the reasonable satisfaction of the Collateral
Agent, and signed by an officer of the Lien Grantor.
"Permitted Liens" means (i) the Transaction Liens and (ii) any other Liens
on the Collateral permitted to be created or assumed or to exist pursuant to the
Credit Agreement, including Liens arising in connection with Receivables
Financings (including the Effective Date Receivables Financing).
"Pledged", when used in conjunction with any type of asset, means at any
time an asset of such type that is included (or that creates rights that are
included) in the Collateral at such time. For example, "Pledged Inventory" means
Inventory that is included in the Collateral at such time.
"Post-Petition Interest" means any interest that accrues after the
commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency or reorganization of the Lien Grantor (or would accrue but for the
operation of applicable bankruptcy or insolvency laws), whether or not such
interest is allowed or allowable as a claim in any such proceeding.
"Proceeds" means all proceeds of, and all other profits, products, rents or
receipts, in whatever form, arising from the collection, sale, lease, exchange,
assignment, licensing or other disposition of, or other realization upon, any
Collateral, including all claims of the Lien Grantor against third parties for
loss of, damage to or destruction of, or for proceeds payable under, or unearned
premiums with respect to, policies of insurance in respect of, any Collateral,
and any condemnation or requisition payments with respect to any Collateral.
"Receivables" means all Accounts owned by the Lien Grantor and all other
rights, titles or interests which, in accordance with GAAP would be included in
receivables on its balance sheet (including any such Accounts and/or rights,
titles or interests that might be characterized as Chattel Paper, Instruments or
General Intangibles under the Uniform Commercial Code in effect in any
jurisdiction), in each case arising from the sale, lease, exchange or other
disposition of Inventory, and all of the Lien Grantor's rights to any goods,
services or other property related to any of the foregoing (including returned
or repossessed goods and unpaid seller's rights of rescission, replevin,
reclamation and rights to stoppage in transit), and all collateral security and
supporting obligations of any kind given by any Person with respect to any of
the foregoing.
"Receivables SPV" means U.S. Steel Receivables LLC, a Delaware limited
liability company and a wholly-owned Subsidiary of the Borrower.
"Related Documents" means the Credit Agreement, any promissory notes issued
pursuant to Section 2.09(e) of the Credit Agreement, the Security Documents and
the documentation governing the Additional Secured Obligations.
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and its Affiliates.
"Related Transferred Rights" has the meaning specified in Section 2(b)
hereof. "Release Conditions" means the following conditions for terminating all
the Transaction Liens:
(i) all Commitments under the Credit Agreement shall have expired or been
terminated;
(ii) all Liquidated Secured Obligations shall have been paid in full; and
(iii) no Unliquidated Secured
Obligation shall remain outstanding or such Unliquidated Secured Obligation
shall be cash collateralized to an extent and in a manner reasonably
satisfactory to each affected Secured Party.
"Second Secured Derivative Obligations" means all Secured Derivative
Obligations that are not First Secured Derivative Obligations.
"Secured Agreement", when used with respect to any Secured Obligation,
refers collectively to each instrument, agreement or other document that sets
forth obligations of the Lien Grantor and/or rights of the holder with respect
to such Secured Obligation.
"Secured Derivative Obligations" means Derivative Obligations of the
Borrower owing to any Person that was a Lender or Lender Affiliate on the trade
date for any such Derivative Obligation, or an assignee of such Person; provided
that (i) such Derivative Obligation is entered into in the course of the
ordinary business practice of the Borrower and not for speculative purposes,
(ii) at or prior to the time the written agreement evidencing such Derivative
Obligation (a "Derivative Contract") is executed, the Borrower and the Lender or
Lender Affiliate party thereto shall have expressly agreed in writing that such
obligations constitute "Secured Derivative Obligations" entitled to the benefits
of the Security Documents, (iii) at or prior to the time such Derivative
Contract is executed, the Lender or Lender Affiliate party thereto shall have
delivered a notice to the Collateral Agent (or, in the case of a Lender
Affiliate, an instrument in form and substance satisfactory to the Collateral
Agent) to the effect set forth in clause (ii) of this proviso, and acknowledging
and agreeing to be bound by the terms of this Agreement with respect to such
obligations and (iv) at the time such Derivative Contract is executed, the
Borrower shall have specified in writing to the Collateral Agent whether or not,
after giving effect to such Derivative Contract, the aggregate Mark-to-Market
Value of all Secured Derivative Obligations as of such date will exceed
$25,000,000 (and, in the event that such aggregate Mark-to-Market Value will
exceed $25,000,000 after giving effect to such Derivative Contract, the Borrower
and the Lender or Lender Affiliate party thereto shall have expressly agreed
that the Derivative Obligations arising thereunder shall constitute Second
Secured Derivative Obligations under this Agreement at all times unless either
(x) such aggregate Mark-to-Market Value does not exceed $25,000,000 (as
evidenced by the Borrowing Base Certificate then most recently delivered by the
Borrower pursuant to Section 5.01(b) of the Credit
Agreement, certifying that the aggregate Mark-to-Market Value of all Secured
Derivative Obligations is less than $25,000,000) or (y) together with the
Borrowing Base Certificate then most recently delivered by the Borrower pursuant
to Section 5.01(b) of the Credit Agreement, the Borrower shall have delivered
written notice to the Collateral Agent designating such Derivative Obligations
as First Secured Derivative Obligations, which written notice shall include a
list of all First Secured Derivative Obligations, the aggregate Mark-to-Market
Value of which will not exceed $25,000,000).
"Secured Loan Obligations" means all principal of all Loans and LC
Reimbursement Obligations outstanding from time to time under the Credit
Agreement, all interest (including Post-Petition Interest) on such Loans and LC
Reimbursement Obligations and all other amounts now or hereafter payable by the
Borrower pursuant to the Loan Documents.
"Secured Obligations" means the Secured Loan Obligations and the Additional
Secured Obligations.
"Secured Parties" means the holders from time to time of the Secured
Obligations, and "Secured Party " means any of them as the context may require.
"Security Documents" means this Agreement, the Intercreditor Agreement and
all other supplemental or additional security agreements, control agreements, or
similar instruments delivered pursuant to the Loan Documents.
"Supporting Obligation" means a "supporting obligation" (as such term is
defined in UCC Section 9-102).
"Sweep Period" has the meaning set forth in Section 6(c).
"Transaction Liens" means the Liens granted by the Lien Grantor under the
Security Documents.
"Transferred Receivables" means any Receivables that have been sold,
contributed or otherwise transferred to an Eligible Transferee in connection
with a Receivables Financing that is not prohibited under the Credit Agreement
or this Agreement (including, without limitation, the Effective Date Receivables
Financing).
"UCC" means the Uniform Commercial Code as in effect from time to time in
the State of New York; provided that, if perfection or the effect of perfection
or non-perfection or the priority of any Transaction Lien on any Collateral is
governed by the Uniform Commercial Code as in effect in a jurisdiction other
than New York, "UCC" means the Uniform Commercial Code as in effect from time to
time in such other jurisdiction for purposes of the provisions hereof relating
to such perfection, effect of perfection or non-perfection or priority.
"Unliquidated Secured Obligation" means, at any time, any Secured
Obligation (or portion thereof) that is contingent in nature or unliquidated at
such time, including any Secured Obligation that is:
(i) an obligation to reimburse a bank for drawings not yet made under a
letter of credit issued by it;
(ii) any other obligation (including any guarantee) that is contingent in
nature at such time; or
(iii) an obligation to provide collateral to secure any of the foregoing
types of obligations.
(d) Terms Generally. The definitions of terms herein (including those
incorporated by reference to the UCC or to another document) apply equally to
the singular and plural forms of the terms defined. Whenever the context may
require, any pronoun includes the corresponding masculine, feminine and neuter
forms. The words "include", "includes" and "including" shall be deemed to be
followed by the phrase "without limitation". The word "will" shall be construed
to have the same meaning and effect as the word "shall". Unless the context
requires otherwise, (a) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Sections, Exhibits
and Schedules shall be construed to refer to Sections of, and Exhibits and
Schedules to, this Agreement and (e) the word "property" shall be construed to
refer to any and all tangible and intangible assets and properties, including
cash, securities, accounts and contract rights.
(a) The Lien Grantor, in order to secure the Secured Obligations,
grants to the Collateral Agent for the benefit of the Secured Parties a
continuing security interest in all the following property of the Lien Grantor,
whether now owned or existing or hereafter acquired or arising and regardless of
where located, subject to the exceptions set forth in Section 2(b):
(i) all Inventory;
(ii) all Receivables;
(iii) all Contracts;
(iv) all books and records (including customer lists, credit files,
computer programs, printouts and other computer materials and
records) of the Lien Grantor pertaining to any of its Collateral;
and
(v) all other Proceeds of the Collateral described in the foregoing
clauses (i) through (iv).
(b) The Collateral shall not include Transferred Receivables and (i)
rights to payment and collections in respect of such Transferred Receivables,
(ii) security interests or Liens and property subject thereto purporting to
secure or guarantee payment of such Transferred Receivables, (iii) guarantees,
letters of credit, acceptances, insurance and other arrangements from time to
time supporting or securing payment of such Transferred Receivables, (iv) all
invoices, documents, books, records and other information with respect to such
Transferred Receivables or the obligors thereon, (v) with respect to any such
Transferred Receivables, the transferee's interest in the product (including
returned product), the sale of which by such transferee gave rise to such
Transferred Receivables and (vi) all Proceeds of the items described in
subclauses 2(b)(i) through 2(b)(v) (preceding subclauses (b)(i) through (b)(vi),
collectively, the "Related Transferred Rights").
(c) With respect to each right to payment or performance included in
the Collateral from time to time, the Transaction Lien granted therein includes
a continuing security interest in all right, title and interest of the Lien
Grantor in and to (i) any Supporting Obligation that supports such payment or
performance and (ii) any Lien that (x) secures such right to payment or
performance or (y) secures any such Supporting Obligation.
(d) The Transaction Liens are granted as security only and shall not
subject the Collateral Agent or any other Secured Party to, or transfer or in
any way affect or modify, any obligation or liability of the Lien Grantor with
respect to any of the Collateral or any transaction in connection therewith.
. The Lien Grantor represents and warrants that:
(a) The Lien Grantor is duly organized, validly existing and in good
standing under the laws of the jurisdiction identified as its jurisdiction of
organization in its Perfection Certificate.
(b) The Lien Grantor has good and marketable title to all its
Collateral (subject to exceptions that are, in the aggregate, not material),
free and clear of any Lien other than Permitted Liens.
(c) The Lien Grantor has not performed any acts that might prevent the
Collateral Agent from enforcing any of the provisions of the Security Documents
or that would limit the Collateral Agent in any such enforcement. No financing
statement, security agreement, mortgage or similar or equivalent document or
instrument covering all or part of the Collateral owned by such Lien Grantor is
on file or of record in any jurisdiction in which such filing or recording would
be effective to perfect or record a Lien on such Collateral, except financing
statements, mortgages or other similar or equivalent documents with respect to
Permitted Liens. After the Effective Date, no Collateral owned by such Lien
Grantor will be in the possession or under the control of any other Person
having a Lien thereon, other than a Permitted Lien.
(d) The Transaction Liens on all Collateral owned by the Lien Grantor
(i) have been validly created, (ii) will attach to each item of such Collateral
on the Effective Date (or, if such Lien Grantor first obtains rights thereto on
a later date, on such later date) and (iii) when so attached, will secure all
the Secured Obligations.
(e) The Lien Grantor has delivered a Perfection Certificate to the
Collateral Agent. The information set forth therein is correct and complete as
of the Effective Date. After the Effective Date, the Collateral Agent or the
Administrative Agent may obtain, at the Lien Grantor's expense, a file search
report from each UCC filing office listed in its Perfection Certificate, showing
the filing made at such filing office to perfect the Transaction Liens on the
Collateral.
(f) When UCC financing statements describing the Collateral as set
forth in the Lien Grantor's Perfection Certificate have been filed in the
offices specified in the Perfection Certificate, the Transaction Liens will
constitute perfected security interests in the Collateral owned by the Lien
Grantor to the extent that a security interest therein may be perfected by
filing pursuant to the UCC, prior to all Liens and rights of others therein
except Permitted Liens. Except for the filing of such UCC financing statements,
no registration, recordation or filing with any governmental body, agency or
official is required in connection with the execution or delivery of the
Security Documents or is necessary for the validity or enforceability thereof or
for the perfection of the Transaction Liens pursuant to the UCC or for the
enforcement of the Transaction Liens pursuant to the UCC.
(g) The Lien Grantor has taken, and will continue to take, all actions
necessary under the UCC to perfect its interest in any Receivables purchased or
otherwise acquired by it, as against its assignors and creditors of its
assignors.
(h) The Lien Grantor's Collateral is insured as required by the Credit
Agreement.
(i) Any Inventory produced by the Lien Grantor has or will have been
produced in compliance with the applicable requirements of the Fair Labor
Standards Act, as amended.
(j) The Existing Receivables SPV Accounts are all of the accounts
owned by Receivables SPV. Other than (i) the Existing Receivables SPV Accounts,
(ii) the Cash Collateral Account and (iii) any lockbox,
concentration or similar account which has been subjected to a Blocked Account
Agreement pursuant to Section 4(a), there are no accounts owned by the Lien
Grantor or Receivables SPV into which any collections or other payments or
proceeds in respect of Pledged Receivables may be deposited.
. The Lien Grantor covenants as follows:
(a) The Lien Grantor will, from time to time, at its own expense,
execute, deliver, authorize, file and record any statement, assignment,
instrument, document, agreement or other paper and take any other action
(including (x) any filing of financing or continuation statements under the UCC,
(y) at any time when the Effective Date Receivables Financing shall have
terminated and been paid in full and not been replaced with another Receivables
Financing on terms satisfactory to the Administrative Agent, causing any
lockbox, concentration or similar account into which payments with respect to
Receivables then owned by the Lien Grantor will be received to be subjected to
Blocked Account Agreements and (z) at any time when the Effective Date
Receivables Financing shall have terminated and been replaced with another
Receivables Financing on terms satisfactory to the Administrative Agent, causing
the appropriate parties to such replacement Receivables Financing to execute an
intercreditor agreement that is substantially identical to the Intercreditor
Agreement) that from time to time may be reasonably necessary or desirable, or
that the Collateral Agent may reasonably request, in order to:
(i) create, preserve, perfect, confirm or validate the Transaction
Liens on the Collateral;
(ii) enable the Collateral Agent and the other Secured Parties to
obtain the full benefits of the Security Documents; or
(iii) enable the Collateral Agent to exercise and enforce any of its
rights, powers and remedies with respect to any of the Collateral.
To the extent permitted by applicable law, the Lien Grantor authorizes the
Collateral Agent to execute and file such financing statements or continuation
statements without the Lien Grantor's signature appearing thereon. The
Collateral Agent agrees to provide the Lien Grantor with copies of any such
financing statements and continuation statements. The Lien Grantor agrees that a
carbon, photographic, photostatic or other reproduction of this Agreement or of
a financing statement is sufficient as a financing statement to the extent
permitted by law. The Lien Grantor constitutes the Collateral Agent its
attorney-in-fact to execute and file all filings required or so requested for
the foregoing purposes, all acts of such attorney being hereby ratified and
confirmed; and such power, being coupled with an interest, shall be irrevocable
until all the Transaction Liens granted by the Lien Grantor terminate pursuant
to Section 12. The Borrower will pay the costs of, or incidental to, any
recording or filing of any financing or continuation statements or other
documents recorded or filed pursuant hereto.
(b) The Lien Grantor will not (i) change its name or limited liability
company structure (or other form of organization), except to reorganize as a
Delaware corporation under the name "United States Steel Corporation", (ii)
change its location (determined as provided in UCC Section 9-307) or (iii)
except with respect to a Permitted Lien, become bound, as provided in Revised
UCC Section 9-203(d) or otherwise, by a security agreement entered into by
another Person, unless it shall have given the Collateral Agent prior notice
thereof and delivered an Opinion of Counsel with respect thereto in accordance
with Section 4(c).
(c) At least 30 days before it takes any action contemplated by
Section 4(b), the Lien Grantor, at its own expense, will cause to be delivered
to the Collateral Agent an Opinion of Counsel, in form and substance reasonably
satisfactory to the Collateral Agent, to the effect that (i) all financing
statements and amendments or supplements thereto, continuation statements and
other documents required to be filed or recorded in order to perfect and protect
the Transaction Liens against all creditors of and purchasers from the Lien
Grantor after it takes such action (except any applicable continuation
statements specified in such Opinion of Counsel that are to be filed more than
six months after the date thereof) have been filed or recorded in each office
necessary for such purpose, (ii) all fees and taxes, if any, payable in
connection with such filings or recordations have been paid in full and (iii)
except as otherwise agreed by the Required Lenders, such action will not
adversely affect the perfection or priority of the Transaction Lien on any
Collateral to be owned by the Lien Grantor after it takes such action or the
accuracy of the Lien Grantor's representations and warranties herein relating to
such Collateral.
(d) The Lien Grantor will not sell, lease, exchange, assign or
otherwise dispose of, or grant any option with respect to, any of its
Collateral; provided that the Lien Grantor may do any of the foregoing unless
(i) doing so would breach a covenant in the Credit Agreement or (ii) an Event of
Default shall have occurred and be continuing and the Collateral Agent shall
have notified the Lien Grantor that its right to do so is terminated, suspended
or otherwise limited. Concurrently with any sale or other disposition (except a
lease) permitted by the foregoing proviso, the Transaction Liens on the assets
sold or disposed of (but not in any Proceeds arising from such sale or
disposition)
will cease immediately without any action by the Collateral Agent or any other
Secured Party. The Collateral Agent will, at the Borrower's expense, execute and
deliver to the Lien Grantor such documents as the Lien Grantor shall reasonably
request to evidence the fact that any asset so sold or disposed of is no longer
subject to a Transaction Lien.
(e) The Lien Grantor will, promptly upon request, provide to the
Collateral Agent all information and evidence concerning the Collateral that the
Collateral Agent may reasonably request from time to time to enable it to
enforce the provisions of the Security Documents.
(f) From time to time upon request by the Collateral Agent, the Lien
Grantor will, at its own expense, cause to be delivered to the Secured Parties
an Opinion of Counsel satisfactory to the Collateral Agent as to such matters
relating to the transactions contemplated hereby as the Collateral Agent may
reasonably request.
. (a) If and when required for purposes hereof, the Collateral Agent
will establish an account (the "Cash Collateral Account"), in the name and under
the exclusive control of the Collateral Agent, into which all amounts owned by
the Lien Grantor that are to be deposited therein pursuant to the Financing
Documents shall be deposited from time to time.
(b) Within 30 days following the Effective Date (or such longer period
as the Borrower, the Collateral Agent and the Co-Collateral Agent may agree),
the Lien Grantor will cause Receivables SPV to have subjected all of its then
existing accounts (collectively, the "Existing Receivables SPV Accounts") to
Blocked Account Agreements, each of which Blocked Account Agreements shall, to
the extent the account subject thereto is a "Lock-Box Account" or "Concentration
Account" (each as defined in the Receivables Purchase Agreement), (i) by its
terms, first become effective immediately upon receipt by the "Lockbox Box" or
"Concentration Account Bank" (each as defined in the Receivables Purchase
Agreement) or other depositary bank at which such account is maintained (the
"Depositary Bank") of written notice from The Bank of Nova Scotia, as collateral
agent under the Effective Date Receivables Financing (the "Receivables
Collateral Agent"), specifying that the Effective Date Receivables Financing has
terminated and all monetary obligations in respect thereof have been satisfied
in full and that the blocked account agreement in effect with respect to such
"Lockbox Account" or "Concentration Account" (each as defined in the Receivables
Purchase Agreement) in connection with the Effective Date Receivables Financing
shall be terminated in accordance with its terms (or upon written notice from
the Collateral Agent to such effect, if (x) the Receivables Collateral Agent has
failed to deliver such notice within five Business Days of the date on which it
is initially obligated to do so pursuant to the Intercreditor Agreement, (y) the
Collateral Agent shall have delivered a Final Notification Request (as defined
in the Intercreditor Agreement), and (z) the Funding Agents (as defined in the
Intercreditor Agreement) have failed to comply, or to cause the Receivables
Collateral Agent to comply, with such Final Notification Request within three
Business Days of the date on which such Final Notification Request is effective
under the Intercreditor Agreement), (ii) by its terms, terminate upon receipt by
the Depositary Bank of written notice from the Collateral Agent to the effect
that the Effective Date Receivables Financing has been replaced with another
Receivables Financing on terms satisfactory to the Administrative Agent, such
that the accounts of Receivables SPV and the lockbox accounts of the Lien
Grantor may be subjected to blocked account agreements in connection with such
replacement Receivables Financing and (iii) expressly provide that its terms may
not be amended or modified without the consent of the Receivables Collateral
Agent.
(c) If directed to do so by the Collateral Agent at any time when an
Event of Default has occurred and is continuing, the Borrower shall cause to be
deposited in the account referred to in clause (d) below, promptly upon receipt
thereof, (i) all payments received in respect of the Pledged Receivables and
(ii) all other Proceeds of the Collateral.
(d) Within 30 days following the Effective Date, the Borrower shall
cause to be subjected to a Blocked Account Agreement any lockbox, concentration
or other account into which payments from Receivables SPV to the Borrower in
respect of the purchase price of Transferred Receivables may be received.
(e) Unless (x) a Sweep Period shall have occurred and be continuing,
(y) an Event of Default shall have occurred and be continuing and the Required
Lenders shall have instructed the Collateral Agent to stop withdrawing amounts
from the Cash Collateral Account pursuant to this subsection or (z) the maturity
of the Loans (or other Secured Obligations) shall have been accelerated pursuant
to Article 7 of the Credit Agreement (or otherwise), the Collateral Agent shall
withdraw amounts from the Cash Collateral Account (other than amounts required
to be deposited in the Cash Collateral Account pursuant to Section 2.10(b) or
Section 5.12(b) of the Credit Agreement) and remit such amounts to, or as
directed by, the Borrower from time to time.
(f) If an Event of Default shall have occurred and be continuing, the
Collateral Agent may (i) retain all cash and investments then held in the Cash
Collateral Account, (ii) liquidate any or all investments held therein
and/or (iii) withdraw any amounts held therein and apply such amounts as
provided in Section 7. Additionally, and without limiting the generality of the
foregoing, during any Sweep Period (i) all amounts held in the Cash Collateral
Account (other than amounts deposited therein pursuant to Section 2.05(j),
Section 2.10 (b) or Section 5.12(b) of the Credit Agreement as cash collateral
for the LC Exposure) shall be applied on a daily basis to the outstanding
principal balance of the Base Rate Loans or, if applicable, as provided in
Section 7 and (ii) following repayment in full of all outstanding Base Rate
Loans pursuant to clause (i), any remaining amounts held in the Cash Collateral
Account shall continue to be held in the Cash Collateral Account and (other than
amounts deposited therein pursuant to Section 2.05(j), Section 2.10(b) or
Section 5.12(b) of the Credit Agreement as cash collateral for the LC Exposure)
shall be applied to the outstanding principal balance of maturing Eurodollar
Loans upon expiration of the Interest Periods applicable thereto.
(g) Funds held in the Cash Collateral Account may, until withdrawn or
otherwise applied pursuant hereto, be invested and reinvested in such Liquid
Investments as the Borrower shall request from time to time; provided that, if
an Event of Default shall have occurred and be continuing, the Collateral Agent
may select such Liquid Investments.
(h) If immediately available cash on deposit in the Cash Collateral
Account is not sufficient to make any distribution or withdrawal to be made
pursuant hereto, the Collateral Agent will cause to be liquidated, as promptly
as practicable, such investments held in or credited to the Cash Collateral
Account as shall be required to obtain sufficient cash to make such distribution
or withdrawal and, notwithstanding any other provision hereof, such distribution
or withdrawal shall not be made until such liquidation has taken place.
. (a) If an Event of Default shall have occurred and be continuing,
the Collateral Agent may exercise (or cause its sub-agents to exercise) any or
all of the remedies available to it (or to such sub-agents) under the Security
Documents.
(b) Without limiting the generality of the foregoing, if an Event of
Default shall have occurred and be continuing, the Collateral Agent may exercise
on behalf of the Secured Parties all the rights of a secured party under the UCC
(whether or not in effect in the jurisdiction where such rights are exercised)
with respect to any Collateral and, in addition, the Collateral Agent may,
without being required to give any notice, except as herein provided or as may
be required by mandatory provisions of law, withdraw all cash held in the Cash
Collateral Account and apply such cash as provided in Section 7 and, if there
shall be no such cash or if such cash shall be insufficient to pay all the
Secured Obligations in full, sell, lease, license or otherwise dispose of the
Collateral or any part thereof. Notice of any such sale or other disposition
shall be given to the Lien Grantor as required by Section 9.
(c) Without limiting the generality of the foregoing, during any Sweep
Period (as defined below), the Collateral Agent may (i) exercise all of the
remedies described in Section 5(f) and (ii) cause all amounts constituting
Collateral that are held in any lockbox, concentration or other account of the
Lien Grantor then subject to an effective Blocked Account Agreement (it being
understood that any Blocked Account Agreement with respect to an account that is
a "Lockbox Account" or "Concentration Account" (each as defined in the
Receivables Purchase Agreement) shall only become effective in accordance with
Section 5(b)(i)) to be transferred on a daily basis to the Cash Collateral
Account. As used herein, the term "Sweep Period" means each period that begins
upon the occurrence of (x) an Event of Default described in Section 7(a),
Section 7(i), Section 7(j) or Section 7(k) of the Credit Agreement or (y) an
Event of Default caused by the Borrower's failure to perform any covenant
contained in Section 6.13 or Section 6.14 of the Credit Agreement, and ends when
no such Event of Default is continuing; provided that, except in the case of a
Sweep Period that begins upon the occurrence of any Event of Default described
in Section 7(a), Section 7(i), Section 7(j) or Section 7(k) of the Credit
Agreement with respect to the Borrower (which Sweep Period shall commence
automatically upon the occurrence of such Event of Default), no Sweep Period
shall be deemed to have commenced unless and until the Collateral Agent shall
have so determined and shall have so notified the Borrower.
. (a) If an Event of Default shall have occurred and be continuing, the
Collateral Agent may apply (i) any cash held in the Cash Collateral Account and
(ii) the proceeds of any sale or other disposition of all or any part of the
Collateral, in the following order of priorities:
first, to pay the expenses of such sale or other disposition,
including reasonable compensation to agents of and counsel for the
Collateral Agent, and all expenses, liabilities and advances incurred or
made by the Collateral Agent in connection with the Security Documents, and
any other amounts then due and payable to the Collateral Agent pursuant to
Section or to any Agent pursuant to the Credit Agreement;
second, to pay the unpaid principal of the Secured Obligations (other
than Second Secured Derivative Obligations) ratably (or provide for the
payment thereof pursuant to Section 7(b)), until payment in full of the
principal of all Secured Obligations (other than Second Secured Derivative
Obligations) shall have been made (or so provided for);
third, to pay ratably all interest (including Post-Petition Interest)
on the Secured Obligations (other than Second Secured Derivative
Obligations) and all commitment and other fees payable under the Related
Documents, until payment in full of all such interest and fees shall have
been made;
fourth, to pay all other Secured Obligations (other than Second
Secured Derivative Obligations) ratably (or provide for the payment thereof
pursuant to Section 7(b)), until payment in full of all such other Secured
Obligations (other than Second Secured Derivative Obligations) shall have
been made (or so provided for);
fifth, to pay ratably the unpaid principal of the Second Secured
Derivative Obligations (or provide payment therefor pursuant to Section
7(b)) until payment in full of the principal of all Second Secured
Derivative Obligations shall have been made (or so provided for);
sixth, to pay ratably all interest (including Post-Petition Interest)
on the Second Secured Derivative Obligations, until payment in full of all
such interest shall have been made; and
finally, to pay to the Lien Grantor, or as a court of competent
jurisdiction may direct, any surplus then remaining from the proceeds of
the Collateral owned by it.
The Collateral Agent may make such distributions hereunder in cash or in kind
or, on a ratable basis, in any combination thereof.
(b) If at any time any portion of any monies collected or received by
the Collateral Agent would, but for the provisions of this Section 7(b), be
payable pursuant to Section 7(a) in respect of an Unliquidated Secured
Obligation, the Collateral Agent shall not apply any monies to pay such
Unliquidated Secured Obligation but instead shall request the holder thereof, at
least 10 days before each proposed distribution hereunder, to notify the
Collateral Agent as to the maximum amount of such Unliquidated Secured
Obligation if then ascertainable (e.g., in the case of a letter of credit, the
maximum amount available for subsequent drawings thereunder). If the holder of
such Unliquidated Secured Obligation does not notify the Collateral Agent of the
maximum ascertainable amount thereof at least two Domestic Business Days before
such distribution, such Unliquidated Secured Obligation will not be entitled to
share in such distribution. If such holder does so notify the Collateral Agent
as to the maximum ascertainable amount thereof, the Collateral Agent will
allocate to such holder a portion of the monies to be distributed in such
distribution, calculated as if such Unliquidated Secured Obligation were
outstanding in such maximum ascertainable amount. However, the Collateral Agent
will not apply such portion of such monies to pay such Unliquidated Secured
Obligation, but instead will hold such monies or invest such monies in Liquid
Investments. All such monies and Liquid Investments and all proceeds thereof
will constitute Collateral hereunder, but will be subject to distribution in
accordance with this Section 7(b) rather than Section 7(a). The Collateral Agent
will hold all such monies and Liquid Investments and the net proceeds thereof in
trust until all or part of such Unliquidated Secured Obligation becomes a
Liquidated Secured Obligation, whereupon the Collateral Agent at the request of
the relevant Secured Party will apply the amount so held in trust to pay such
Liquidated Secured Obligation; provided that, if the other Secured Obligations
theretofore paid pursuant to the same clause of Section 7(a) (i.e., clause
second, fourth or fifth) were not paid in full, the Collateral Agent will apply
the amount so held in trust to pay the same percentage of such Liquidated
Secured Obligation as the percentage of such other Secured Obligations
theretofore paid pursuant to the same clause of Section 7(a). If (i) the holder
of such Unliquidated Secured Obligation shall advise the Collateral Agent that
no portion thereof remains in the category of an Unliquidated Secured Obligation
and (ii) the Collateral Agent still holds any amount held in trust pursuant to
this Section 7(b) in respect of such Unliquidated Secured Obligation (after
paying all amounts payable pursuant to the preceding sentence with respect to
any portions thereof that became Liquidated Secured Obligations), such remaining
amount will be applied by the Collateral Agent in the order of priorities set
forth in Section 7(a)
(c) In making the payments and allocations required by this Section,
the Collateral Agent may rely upon information supplied to it pursuant to
Section 11(g). All distributions made by the Collateral Agent pursuant to this
Section shall be final (except in the event of manifest error) and the
Collateral Agent shall have no duty to inquire as to the application by any
Secured Party of any amount distributed to it.
. (a) The Lien Grantor will forthwith upon demand pay to the
Collateral Agent:
(i) the amount of any taxes that the Collateral Agent may have
been required to pay by reason of the Transaction Liens or to free any
Collateral from any other Lien thereon;
(ii) the amount of any and all reasonable out-of-pocket expenses,
including transfer taxes and reasonable fees and expenses of counsel
and other experts, that the Collateral Agent may incur in connection
with (x) the administration or enforcement of the Security Documents,
including such expenses as are incurred to preserve the value of the
Collateral or the validity, perfection, rank or value of any
Transaction Lien, (y) the collection, sale or other disposition of any
Collateral or (z) the exercise by the Collateral Agent of any of its
rights or powers under the Security Documents;
(iii) the amount of any fees that the Lien Grantor shall have
agreed in writing to pay to the Collateral Agent and that shall have
become due and payable in accordance with such written agreement; and
(iv) the amount required to indemnify the Collateral Agent for,
or hold it harmless and defend it against, any loss, liability or
expense (including the reasonable fees and expenses of its counsel and
any experts or sub-agents appointed by it hereunder) incurred or
suffered by the Collateral Agent in connection with the Security
Documents, except to the extent that such loss, liability or expense
arises from the Collateral Agent's gross negligence or willful
misconduct or a breach of any duty that the Collateral Agent has under
this Agreement (after giving effect to Sections 10 and 11). Any such
amount not paid to the Collateral Agent on demand will bear interest
for each day thereafter until paid at a rate per annum equal to the
sum of 2.00% plus the Alternate Base Rate for such day plus the
Applicable Rate that would, in the absence of an Event of Default, be
applicable to the Base Rate Loans for such day.
(b) If any transfer tax, documentary stamp tax or other tax is payable
in connection with any transfer or other transaction provided for in the
Security Documents, the Lien Grantor will pay such tax and provide any required
tax stamps to the Collateral Agent or as otherwise required by law.
. The Lien Grantor irrevocably appoints the Collateral Agent its true
and lawful attorney, with full power of substitution, in the name of the Lien
Grantor, any Secured Party or otherwise, for the sole use and benefit of the
Secured Parties, but at the Lien Grantor's expense, to the extent permitted by
law to exercise, at any time and from time to time while an Event of Default
shall have occurred and be continuing, all or any of the following powers with
respect to all or any of the Collateral (to the extent necessary to pay the
Secured Obligations in full):
(a) to demand, sue for, collect, receive and give acquittance for any
and all monies due or to become due upon or by virtue thereof,
(b) to settle, compromise, compound, prosecute or defend any action or
proceeding with respect thereto,
(c) to sell, lease, license or otherwise dispose of the same or the
proceeds or avails thereof, as fully and effectually as if the Collateral
Agent were the absolute owner thereof, and
(d) to extend the time of payment of any or all thereof and to make
any allowance or other adjustment with reference thereto;
provided that, except in the case of Collateral that is perishable or threatens
to decline speedily in value or is of a type customarily sold on a recognized
market, the Collateral Agent will give the Lien Grantor at least ten days' prior
written notice of the time and place of any public sale thereof or the time
after which any private sale or other intended disposition thereof will be made.
Any such notice shall (i) contain the information specified in UCC Section
9-613, (ii) be Authenticated and (iii) be sent to the parties required to be
notified pursuant to UCC Section 9-611(c); provided that, if the Collateral
Agent fails to comply with this sentence in any respect, its liability for such
failure shall be limited to the liability (if any) imposed on it as a matter of
law under the UCC.
. Beyond the exercise of reasonable care in the custody and
preservation thereof, the Collateral Agent will have no duty as to any
Collateral in its possession or control or in the possession or control of any
sub-agent or bailee or any income therefrom or as to the preservation of rights
against prior parties or any other rights pertaining thereto. The Collateral
Agent will be deemed to have exercised reasonable care in the custody and
preservation of the Collateral in its possession or control if such Collateral
is accorded treatment substantially equal to that which it accords its own
property, and will not be liable or responsible for any loss or damage to any
Collateral, or for any diminution in the value thereof, by reason of any act or
omission of any sub-agent or bailee selected by the Collateral Agent in good
faith or by reason of any act or omission by the Collateral Agent pursuant to
instructions from the Administrative Agent, except to the extent that such
liability arises from the Collateral Agent's gross negligence or willful
misconduct.
. (a) Authority. The Collateral Agent is authorized to take such
actions and to exercise such powers as are delegated to the Collateral Agent by
the terms of the Security Documents, together with such actions and powers as
are reasonably incidental thereto.
(b) Coordination with Secured Parties. To the extent requested to do
so by any Secured Party, the Collateral Agent will promptly notify such Secured
Party of each notice or other communication received by the Collateral Agent
hereunder and/or deliver a copy thereof to such Secured Party. As to any matters
not expressly
provided for herein (including (i) the timing and methods of realization upon
the Collateral and (ii) the exercise of any power that the Collateral Agent may,
but is not expressly required to, exercise under any Security Document), the
Collateral Agent shall act or refrain from acting in accordance with written
instructions from the Required Lenders or, in the absence of such instructions,
in accordance with its discretion (subject to the following provisions of this
Section).
(c) Rights and Powers as a Secured Party. The Person serving as the
Collateral Agent shall, in its capacity as a Secured Party, have the same rights
and powers as any other Secured Party and may exercise the same as though it
were not the Collateral Agent. Such Person and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of business with
the Borrower, any of its Subsidiaries or their respective Affiliates as if it
were not the Collateral Agent hereunder.
(d) Limited Duties and Responsibilities. The Collateral Agent shall
not have any duties or obligations under the Security Documents except those
expressly set forth therein. Without limiting the generality of the foregoing,
(a) the Collateral Agent shall not be subject to any fiduciary or other implied
duties, regardless of whether an Event of Default has occurred and is
continuing, (b) the Collateral Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated by the Security Documents that the
Collateral Agent is required in writing to exercise by the Required Lenders, and
(c) except as expressly set forth in the Security Documents, the Collateral
Agent shall not have any duty to disclose, and shall not be liable for any
failure to disclose, any information relating to the Borrower or any of its
Subsidiaries that is communicated to or obtained by the bank serving as
Collateral Agent or any of its Affiliates in any capacity. The Collateral Agent
shall not be liable for any action taken or not taken by it with the consent or
at the request of the Required Lenders (or such other number or percentage of
the Lenders as shall be necessary under the circumstances as provided in Section
9.02 of the Credit Agreement) or in the absence of its own gross negligence or
willful misconduct. The Collateral Agent shall not be responsible for the
existence, genuineness or value of any Collateral or for the validity,
perfection, priority or enforceability of any Transaction Lien, whether impaired
by operation of law or by reason of any action or omission to act on its part
under the Security Documents. The Collateral Agent shall be deemed not to have
knowledge of any Event of Default unless and until written notice thereof is
given to the Collateral Agent by the Borrower or a Secured Party, and the
Collateral Agent shall not be responsible for or have any duty to ascertain or
inquire into (i) any statement, warranty or representation made in or in
connection with any Security Document, (ii) the contents of any certificate,
report or other document delivered thereunder or in connection therewith, (iii)
the performance or observance of any of the covenants, agreements or other terms
or conditions set forth in any Security Document, (iv) the validity,
enforceability, effectiveness or genuineness of any Security Document or any
other agreement, instrument or document, or (v) the satisfaction of any
condition set forth in any Security Document.
(e) Authority to Rely on Certain Writings, Statements and Advice. The
Collateral Agent shall be entitled to rely on, and shall not incur any liability
for relying on, any notice, request, certificate, consent, statement,
instrument, document or other writing believed by it to be genuine and to have
been signed or sent by the proper Person. The Collateral Agent also may rely on
any statement made to it orally or by telephone and believed by it to be made by
the proper Person, and shall not incur any liability for relying thereon. The
Collateral Agent may consult with legal counsel (who may be counsel for the
Borrower or any of its Subsidiaries), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it
in accordance with the advice of any such counsel, accountant or expert. The
Collateral Agent may rely conclusively on advice from the Administrative Agent
as to whether at any time (i) an Event of Default under the Credit Agreement has
occurred and is continuing, (ii) the maturity of the Loans has been accelerated
or (iii) any proposed action is permitted or required by the Credit Agreement.
(f) Sub-Agents and Related Parties. The Collateral Agent may perform
any of its duties and exercise any of its rights and powers through one or more
sub-agents appointed by it. The Collateral Agent and any such sub-agent may
perform any of its duties and exercise any of its rights and powers through its
Related Parties. The exculpatory provisions of Section 10 and this Section shall
apply to any such sub-agent and to the Related Parties of the Collateral Agent
and any such sub-agent.
(g) Information as to Secured Obligations and Actions by Secured
Parties. For all purposes of the Security Documents, including determining the
amounts of the Secured Obligations and whether a Secured Obligation is an
Unliquidated Secured Obligation or not, or whether any action has been taken
under any Secured Agreement, the Collateral Agent will be entitled to rely on
information from (i) the Administrative Agent for information as to the
Lenders, the Administrative Agent or the Collateral Agent, their Secured
Obligations and actions taken by them, (ii) any Secured Party for information as
to its Secured Obligations and actions taken by it, to the extent that the
Collateral Agent has not obtained such information from the foregoing sources,
and (iii) the Borrower, to the extent that the Collateral Agent has not obtained
information from the foregoing sources.
(h) Within two Business Days after it receives or sends any notice
referred to in this subsection, the Collateral Agent shall send to the
Administrative Agent and each Secured Party requesting notice thereof, copies of
any notice given by the Collateral Agent to the Lien Grantor, or received by it
from the Lien Grantor, pursuant to Section 6, 7, 9, 11(j) or 12; provided that
such Secured Party has, at least five Domestic Business Days prior thereto,
delivered to the Collateral Agent a written notice (i) stating that it holds one
or more Secured Obligations and wishes to receive copies of such notices and
(ii) setting forth its address, facsimile number and e-mail address to which
copies of such notices should be sent.
(i) The Collateral Agent may refuse to act on any notice, consent,
direction or instruction from the Administrative Agent or any Secured Parties or
any agent, trustee or similar representative thereof that, in the Collateral
Agent's opinion, (i) is contrary to law or the provisions of any Security
Document, (ii) may expose the Collateral Agent to liability (unless the
Collateral Agent shall have been indemnified, to its reasonable satisfaction,
for such liability by the Secured Parties that gave, or instructed the Agent to
give, such notice, consent, direction or instruction) or (iii) is unduly
prejudicial to Secured Parties not joining in such notice, consent, direction or
instruction.
(j) Resignation; Successor Collateral Agent. Subject to the
appointment and acceptance of a successor Collateral Agent as provided in this
subsection, the Collateral Agent may resign at any time by notifying the Secured
Parties and the Borrower. Upon any such resignation, the Required Lenders shall
have the right, in consultation with the Lien Grantor, to appoint a successor
Collateral Agent. If no successor shall have been so appointed by the Required
Lenders and shall have accepted such appointment within 30 days after the
retiring Collateral Agent gives notice of its resignation, then the retiring
Collateral Agent may, on behalf of the Secured Parties, appoint a successor
Collateral Agent which shall be a bank with an office in the United States, or
an Affiliate of any such bank. Upon acceptance of its appointment as Collateral
Agent hereunder by a successor, such successor shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Collateral Agent hereunder, and the retiring Collateral Agent shall be
discharged from its duties and obligations hereunder. The fees payable by the
Lien Grantor to a successor Collateral Agent shall be the same as those payable
to its predecessor unless otherwise agreed by the Lien Grantor and such
successor. After the Collateral Agent's resignation hereunder, the provisions of
this Section and Section shall continue in effect for the benefit of such
retiring Collateral Agent, its sub-agents and their respective Related Parties
in respect of any actions taken or omitted to be taken by any of them while the
retiring Collateral Agent was acting as Collateral Agent.
(a) The Transaction Liens shall terminate when all the Release
Conditions are satisfied.
(b) The Transaction Liens (x) with respect to any Pledged Receivables
shall terminate when such Receivables have become Transferred Receivables and
(y) with respect to any other Collateral shall terminate upon the sale of such
Collateral to a Person other than the Lien Grantor in a transaction not
prohibited by the Credit Agreement. In each case, such termination shall not
require the consent of any Secured Party, and the Collateral Agent and any third
party shall be fully protected in relying on a certificate of the Lien Grantor
as to whether any Pledged Receivables qualify as Transferred Receivables
(including without limitation whether the transfer thereof is permitted under
the Credit Agreement and this Agreement).
(c) In the case of any Pledged Receivables, the Transaction Liens with
respect to the Related Transferred Rights shall terminate when such Pledged
Receivables become Transferred Receivables. Such termination shall not require
the consent of any Secured Party. If the Borrower delivers a certificate
pursuant to Section 12(b) stating that any Pledged Receivables qualify as
Transferred Receivables, the Collateral Agent and any third party shall be fully
protected in relying on such certificate as conclusive proof that the Related
Transferred Rights are not Collateral.
(d) At any time before the Transaction Liens terminate, the Collateral
Agent may, at the written request of the Lien Grantor, (i) release any
Collateral (but not all or any substantial portion of the Collateral) with the
prior written consent of the Required Lenders or (ii) release any substantial
portion of the Collateral with the prior written consent of all the Lenders. For
purposes hereof, a release of Collateral comprising 10% or more of the Borrowing
Base in effect on the date of such release shall constitute release of a
substantial portion of the Collateral.
(e) Upon any termination of a Transaction Lien or release of
Collateral, the Collateral Agent will, at the expense of the Lien Grantor,
execute and deliver to the Lien Grantor such documents as the Lien Grantor shall
reasonably request to evidence the termination of such Transaction Lien or the
release of such Collateral, as the case may be.
. Except in the case of notices and other communications expressly
permitted to be given by telephone, each notice, request or other communication
given to any party hereunder shall be in writing delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by telecopy (or,
in the case of any notice to a Secured Party pursuant to Section 11(b) or
Section 11(h), transmitted by e-mail), as follows:
(a) in the case of the Lien Grantor:
United States Steel LLC
600 Grant Street
Room 1325
Pittsburgh, PA 15219
Attention: Treasurer
Facsimile: (412) 433-4567
E-mail: ltbrockway@uss.com
(b) in the case of the Collateral Agent:
J.P. Morgan Chase Bank
Mining and Metals Group
270 Park Avenue
New York, NY 10017
Attention: Carlos Morales
Facsimile: (212) 270-4724
E-mail: carlos.morales@chase.com
and with a copy to:
J.P. Morgan Chase Bank
270 Park Avenue
29th Floor
New York, NY 10017
Attention: Laura Orsini-Tramontana
Facsimile: (212) 270-7449
E-mail: laura.orsini-tramontana@chase.com
with a copy to the Co-Collateral Agent:
General Electric Capital Corporation
800 Connecticut Avenue
Two North
Norwalk, CT 06854
Attention: Account Manager - United States Steel
Facsimile: (203) 852-3660
E-mail: brad.strickland@gecapital.com and
donald.cavanagh@gecapital.com
(c) in the case of any Lender, to the Collateral Agent to be forwarded
to such Lender at its address or facsimile number specified in or pursuant
to Section 9.01 of the Credit Agreement; or
(d) in the case of any Secured Party requesting notice under Section
11(h) , such address, facsimile number or e-mail address as such party may
hereafter specify for the purpose by notice to the Collateral Agent.
All notices and other communications given to any party hereto in
accordance with the terms of this Agreement shall be deemed to have been given
on the date of receipt. Any party may change its address, facsimile number
and/or
e-mail address for purposes of this Section by giving notice of such change to
the Collateral Agent and the Lien Grantor in the manner specified above.
. No failure by the Collateral Agent or any Secured Party to exercise,
and no delay in exercising and no course of dealing with respect to, any right
or remedy under any Related Document shall operate as a waiver thereof; nor
shall any single or partial exercise by the Collateral Agent or any Secured
Party of any right or remedy under any Related Document preclude any other or
further exercise thereof or the exercise of any other right or remedy. The
rights and remedies specified in the Related Documents are cumulative and are
not exclusive of any other rights or remedies provided by law.
. This Agreement is for the benefit of the Collateral Agent and the
Secured Parties. If all or any part of any Secured Party's interest in any
Secured Obligation is assigned or otherwise transferred, the transferor's rights
hereunder, to the extent applicable to the obligation so transferred, shall be
automatically transferred with such obligation. This Agreement shall be binding
on the Lien Grantor and its successors and assigns.
. Neither this Agreement nor any provision hereof may be waived,
amended, modified or terminated except pursuant to an agreement or agreements in
writing entered into by the parties hereto, with the consent of such Lenders as
are required to consent thereto under Section 9.02(b) of the Credit Agreement.
. This Agreement shall be construed in accordance with and governed by
the laws of the State of New York, except as otherwise required by mandatory
provisions of law and except to the extent that remedies provided by the laws of
any jurisdiction other than the State of New York are governed by the laws of
such jurisdiction.
. EACH PARTY HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO ANY SECURITY DOCUMENT OR
ANY TRANSACTION CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY
OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION.
. If any provision of any Security Document is invalid or unenforceable
in any jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions of the Security Documents shall remain in full force and effect in
such jurisdiction and shall be liberally construed in favor of the Collateral
Agent and the Secured Parties in order to carry out the intentions of the
parties thereto as nearly as may be possible and (ii) the invalidity or
unenforceability of such provision in such jurisdiction shall not affect the
validity or enforceability thereof in any other jurisdiction.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
UNITED STATES STEEL LLC
By: /s/ G. R. Haggerty
--------------------------------------------
Name: G. R. Haggerty
Title: Vice President - Accounting & Finance
JPMORGAN CHASE BANK, as Collateral Agent
By: /s/ James H. Ramage
----------------------
Name: James H. Ramage
Title: Managing Director
EXHIBIT A
to Security Agreement
PERFECTION CERTIFICATE
The undersigned is a duly authorized officer of United States Steel LLC
(the "Lien Grantor"). With reference to the Security Agreement dated as of
November 30, 2001 between the Lien Grantor and JPMorgan Chase Bank, as
Collateral Agent (terms defined therein being used herein as therein defined),
the undersigned certifies to the Collateral Agent and each other Secured Party
as follows: A. Information Required for Filings and Searches for Prior Filings.
1. Jurisdiction of Organization. The Lien Grantor is a limited liability
company organized under the laws of Delaware.
2. Name. The exact name of the Lien Grantor as it appears in its
certificate of formation is as follows: United States Steel LCC
3. Prior Names. (a) Set forth below is each other corporate (or other
organizational) name that the Lien Grantor has had since its organization,
together with the date of the relevant change:
(b) Except as set forth below, the Lien Grantor has not changed its
organizational structure./1/
4. Filing Office. In order to perfect the Transaction Liens granted by the
Lien Grantor, a duly signed financing statement on Form UCC-1, with the
collateral described as set forth on Schedule I hereto, should be on file in the
office of in ./2/ Additional Information Required for
------------ ---------
Searches for Prior Filings under old Article 9.
1. Current Locations. (a) The chief executive office of the Lien Grantor is
located at the following address:
Mailing Address County State
The Lien Grantor [does] [does not] have a place of business in another
county of the State listed above.
(b) The following are all locations not identified above where the Lien
Grantor maintains any Inventory:
Mailing Address County State
(c) The following are the names and addresses of all Persons (other than
the Lien Grantor) that have possession of any of the Lien Grantor's Inventory:
Mailing Address County State
IN WITNESS WHEREOF, I have hereunto set my hand this day of ,
-- ----------
.
- ----
----------------------------------
Name:
Title:
Schedule I
to Perfection Certificate
DESCRIPTION OF COLLATERAL
- --------
/1 Changes in corporate structure would include mergers and
consolidations, as well as any change in the Lien Grantor's form of
organization. If any such change has occurred, include in Schedule II the
information required by Part A of this certificate as to each constituent party
to a merger or consolidation and any other predecessor organization./
/2 Insert Lien Grantor's "location" determined as provided in UCC Section
9-307./
All Inventory, Receivables and Contracts, and all books and records (including
customer lists, credit files, computer programs, printouts and other computer
material and records) pertaining to the foregoing, in each case whether now
owned or hereafter acquired and wherever located, and all proceeds thereof, but
excluding all Transferred Receivables and Related Transferred Rights (as each
such term is defined on Exhibit A attached hereto).*
*Form of Exhibit A to UCC-1 Financing Statements is attached hereto.
Exhibit A to UCC-1 Financing Statement
Debtor: Secured Party:
United States Steel LLC JPMorgan Chase Bank, as
600 Grant Street Collateral Agent
Pittsburgh, PA 15219 [address]
Capitalized terms used in the description of collateral set forth on the
face of the UCC-1 Financing Statement to which this Exhibit A pertains shall
have the following meanings:
"Accounts" has the meaning specified in Section 9-102 of the UCC.
"Chattel Paper" has the meaning specified in Section 9-102 of the UCC.
"Contracts" means all contracts for the sale, lease, exchange or other
disposition of Inventory, whether or not performed and whether or not subject to
termination upon a contingency or at the option of any party thereto.
"Credit Agreement" means the Credit Agreement dated as of November 30, 2001
among United States Steel LLC, the Lenders party thereto, PNC Bank, National
Association and Foothill Capital Corporation as Co-Syndication Agents, General
Electric Capital Corporation, as Documentation Agent and Co-Collateral Agent and
JPMorgan Chase Bank, as Administrative Agent, Collateral Agent and Swingline
Lender (as the same may be amended from time to time, the "Credit Agreement").
"Eligible Transferee" means (a) a special-purpose company created and used
solely for purposes of effecting a Receivables Financing, whether or not a
subsidiary of United States Steel, or (b) any other person which is not a
subsidiary of United States Steel.
"General Intangibles" has the meaning specified in Section 9-102 of the
UCC. "Instrument" has the meaning specified in Section 9-102 of the UCC.
"Inventory" has the meaning specified in Section 9-102 of the UCC.
"Receivables" means, with respect to the Debtor, all Accounts owned by it
and all other rights, titles or interests which, in accordance with generally
accepted accounting principles in the United States of America, would be
included in receivables on its balance sheet (including any such Accounts and/or
rights, titles or interests that might be characterized as Chattel Paper,
Instruments or General Intangibles under the UCC), in each case arising from the
sale, lease, exchange or other disposition of Inventory, and all of the Debtor's
rights to any goods, services or other property related to any of the foregoing
(including returned or repossessed goods and unpaid seller's rights of
rescission, replevin, reclamation and rights to stoppage in transit), and all
collateral security and supporting obligations of any kind given by any person
with respect to any of the foregoing.
"Receivables Financing" means any receivables securitization program or
other type of accounts receivable financing transaction by United States Steel
or any of its subsidiaries (including, without limitation, the receivables
financing transaction effected pursuant to (x) the Purchase and Sale Agreement
dated as of November 28, 2001 among U.S. Steel Receivables LLC, the originators
named therein and United States Steel, as initial servicer, and (y) the Amended
and Restated Receivables Purchase Agreement dated as of November 28, 2001 among
U.S. Steel Receivables LLC, as seller, United States Steel, as initial servicer,
The Bank of Nova Scotia, as collateral agent, JPMorgan Chase Bank, as a
committed purchaser and a funding agent, and the various other persons from time
to time party thereto (the "Initial Receivables Financing")).
"Related Transferred Rights" means (a) rights to payment and collections in
respect of Transferred Receivables, (b) security interests or liens and property
subject thereto purporting to secure or guarantee payment of Transferred
Receivables, (c) guarantees, letters of credit, acceptances, insurance and other
arrangements from time to time supporting or securing payment of Transferred
Receivables, (d) all invoices, documents, books, records and other information
with respect to Transferred Receivables or the obligors thereon, (e) with
respect to any Transferred Receivables, the transferee's interest in the product
(including returned product), the sale of which by such transferee
gave rise to such Transferred Receivables and (f) all proceeds of the items
described in foregoing clauses (a) through (e).
"Transferred Receivables" means any Receivables that have been sold,
contributed or otherwise transferred by the Debtor to an Eligible Transferee in
connection with a Receivables Financing that is not prohibited under the Credit
Agreement (including, without limitation, the Initial Receivables Financing
described above).
"UCC" means the Uniform Commercial Code as in effect from time to time in
the State of New York; provided that, if perfection or the effect of perfection
or non-perfection or the priority of any security interest in any collateral is
governed by the Uniform Commercial Code as in effect in a jurisdiction other
than New York, "UCC" means the Uniform Commercial Code as in effect from time to
time in such other jurisdiction for purposes of the provisions hereof relating
to such perfection, effect of perfection or non-perfection or priority.
"United States Steel" means United States Steel LLC, a Delaware limited
liability company, and its successors.
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