Exhibit 10.6
AMENDED AND RESTATED INTERCREDITOR AGREEMENT
THIS AMENDED AND RESTATED INTERCREDITOR AGREEMENT, dated as of the 30th
day of August 2002, by and among The Bank of New York, in its capacity as agent
(hereinafter referred to as the "Note Agent"), for the holders of Senior Notes
(hereinafter referred to as the "Senior Noteholders") issued from time to time
pursuant to the Senior Note Documents and in its capacity as Shared Collateral
Agent, as such terms are defined below, and Congress Financial Corporation
(Central) ("Congress"), in its capacity as collateral agent for itself and the
other Lenders from time to time party to the Bank Credit Agreement, as such
terms are defined below.
RECITALS
A. Anchor Glass Container Corporation (the "Borrower") and the Note Agent
are parties to an Indenture dated April 17, 1997 as amended by the First
Supplemental Indenture dated as of August 30, 2002 (as the same may hereafter be
amended, supplemented, amended and restated or otherwise modified from time to
time, the "Senior Note Indenture"), pursuant to which the Borrower issued its
Senior Notes due April 1, 2005 in the initial aggregate principal amount of
$150,000,000;
B. Concurrently herewith the Borrower is entering into a Loan and Security
Agreement dated as of August 30, 2002 (as the same may hereafter be amended,
supplemented, amended and restated or otherwise modified from time to time, the
"Credit Agreement") with the financial institutions from time to time party
thereto as lenders, Congress, as administrative agent and collateral agent and
Bank of America, N.A., as documentation agent, pursuant to which such lenders
will make available to the Borrower loans in the initial aggregate principal
amount of up to $100,000,000;
C. Concurrently herewith the Borrower is entering into a Term Loan
Agreement dated as of August 30, 2002 (as the same may hereafter be amended,
supplemented, amended and restated or otherwise modified from time to time, the
"Financing Agreement") with the financial institutions from time to time party
thereto as lenders and Ableco Finance LLC as administrative agent pursuant to
which such lenders will make available to the Borrower loans in the initial
aggregate principal amount of $20,000,000;
D. The obligations of the Borrower under the Senior Note Indenture and the
Senior Notes issued thereunder are secured by liens on the Senior Note
Collateral and the Shared Collateral (as such terms are defined below) all as
more specifically set forth in the Senior Note Security Agreement (as defined
below) and the other documents delivered in connection therewith;
E. The obligations of the Borrower under the Credit Agreement are secured
by liens on the Bank Collateral (as defined below) and the Shared Collateral,
all as more specifically set forth in the Credit Agreement and the other
documents delivered in connection therewith;
F. The obligations of the Borrower under the Financing Agreement are also
secured by, inter alia, liens on the Bank Collateral and the Shared Collateral,
all as more specifically set forth in the Financing Agreement and the other
documents delivered in connection therewith;
G. Congress has agreed with the Lenders that Congress will act as
collateral agent for and on their behalf in connection with the administration
and maintenance of the Bank Collateral, in accordance with the terms of the
Collateral Agency and Intercreditor Agreement dated as of August 30, 2002 (as
the same may be amended, supplemented, amended and restated or otherwise
modified from time to time, the "Collateral Agency Agreement"), among Congress,
as collateral agent, and the Lenders; and
H. The Bank of New York, as Note Agent and Shared Collateral Agent, and
Bank of America, N.A., as Credit Agent, are parties to the Intercreditor
Agreement, dated as of February 5, 1997, as amended by Amendment No. 1 to
Intercreditor Agreement dated as of April 17, 1997 and Amendment No. 2 to
Intecreditor Agreement dated as of October 16, 2000 (as so amended, the
"Existing Intercreditor Agreement"). It is proposed that, pursuant to the terms
of the Existing Intercreditor Agreement, upon the effectiveness of this
Agreement Congress, in its capacity as collateral agent under the Collateral
Agency Agreement, become the Credit Agent under the Existing Intercreditor
Agreement and that the Existing Intercreditor Agreement be further amended and
restated as provided herein.
AGREEMENT
In consideration of the premises and the mutual covenants and conditions herein
contained, the Credit Agent, for itself and on behalf of the Lenders, and the
Note Agent, for itself and on behalf of the holders of the Senior Notes,
intending to be legally bound, agree as follows,
1. Definitions. In addition to those terms elsewhere expressly defined in
this Agreement, as used herein, the following terms shall be defined as set
forth below:
"Accounts" means any "account" as such term is defined in Section 9-102 of
the UCC now owned or hereafter acquired by the Borrower or in which the Borrower
now has or hereafter acquires any rights, and, in any event, shall include,
without limitation, all accounts receivable, book debts and other forms of
obligations (other than forms of obligations evidenced by Chattel Paper,
Documents or Instruments) now owned or hereafter received or acquired by or
belonging or owing to the Borrower arising out of inventory sold or leased or
services rendered by the Borrower, whether or not the same have been earned, and
all of the Borrower's rights in, to and under all purchase orders or receipts
now owned or hereafter acquired by it in connection with any Disposition or
anticipated Disposition of Inventory or services, and all of the Borrower's
rights to any Inventory represented by any of the foregoing (including, without
limitation, unpaid seller's rights of rescission, replevin, reclamation and
stoppage in transit and rights to returned, reclaimed or repossessed Inventory),
and all moneys due or to become due to the Borrower under all contracts for the
sale of Inventory or the performance of services or both by the Borrower
(whether or not yet earned by performance on the part of the Borrower or in
connection with any other transaction), now in existence or hereafter occurring,
including, without limitation, the right to receive the Proceeds of said
purchase orders and contracts, and all
2
collateral security and guarantees of any kind given by any Person with respect
to any of the foregoing.
"Anchor Property" means any and all Property of the Borrower, or rights,
title or interests of the Borrower in Property, howsoever arising, acquired or
obtained, whether now or hereafter existing, whether tangible or intangible,
whether real or personal, and wherever located.
"Anchor Real Property" means (i) all freehold real and immoveable property
now owned or hereafter acquired by the Borrower, together with all buildings,
erections, improvements and fixtures now or hereafter constructed or placed
thereon or used in connection therewith, and (ii) all leasehold property now or
hereafter leased by the Borrower, together with all buildings, erections,
improvements and fixtures now or hereafter constructed or placed thereon or used
in connection therewith.
"Article 8 Securities" means all "securities" as defined in Article 8 of
the UCC, whether now owned or hereafter acquired by the Borrower or in which the
Borrower now has or hereafter acquires any rights.
"Bank Collateral" has the meaning set forth in Section 3.1(a).
"Bank Creditors" means, the Credit Agent and the Lenders.
"Bank Credit Agreement" means (a) the Credit Agreement and the Financing
Agreement and (b) any credit agreement, loan agreement, note purchase agreement,
indenture or other agreement, document or instrument refinancing, refunding or
otherwise replacing either the Credit Agreement or the Financing Agreement, or
any other agreement deemed to be either the Credit Agreement or the Financing
Agreement under clause (a) or (b) hereof, whether or not with the same agent,
trustee, representative lenders or holders and, subject to the provisions of the
next succeeding sentence, irrespective of any change in the terms and conditions
thereof; provided, that, any such agreement, document or instrument effecting
any such refunding, refinancing or replacement expressly provides that it is
deemed to be a "Bank Credit Agreement" hereunder. Without limiting the
generality of the foregoing, the term "Bank Credit Agreement" shall include any
amendment, amendment and restatement, renewal, extension, restructuring,
supplement or modification to any Bank Credit Agreement and all refundings,
refinancings and replacements of any Bank Credit Agreement including any
agreement (i) extending the maturity of any Bank Credit Agreement Obligations;
(ii) adding or deleting issuers, borrowers or guarantors thereunder; (iii)
increasing the amount of Bank Credit Agreement Obligations incurred thereunder
or available to be borrowed thereunder, to the extent permitted by Section
4.2(a) hereof; or (iv) otherwise altering the terms and conditions thereof;
provided, that any such agreement, document or instrument effecting any such
refunding, refinancing or replacement expressly provides that it is deemed to be
a "Bank Credit Agreement" hereunder.
"Bank Credit Agreement Obligations" means, collectively, at any time, (a)
all debts, liabilities and obligations of the Borrower, whether now or hereafter
existing, incurred in connection with the Bank Credit Agreement Security
Documents, or any other document, agreement or instrument executed or delivered
in connection therewith to further evidence the
3
debts, liabilities and obligations of the Borrower to any of the Credit
Agent and the Lenders and (b) all Hedging Obligations, in each case, at such
time.
"Bank Credit Agreement Security Documents" means, collectively, the Bank
Credit Agreement and any and all documents executed in connection with the Bank
Credit Agreement or in furtherance thereof, pursuant to which the Borrower
grants any Lenders' Lien on the Lenders' Collateral, as the same may be amended,
modified, or supplemented from time to time.
"Borrower" has the meaning set forth in the Recitals, and includes any
successor thereto.
"Business Day" means any day that is not a Saturday, a Sunday, a day on
which banks are required or authorized to be closed in the State of New York or
a day on which the Credit Agent or the Note Agent is closed for business.
"Cash Collateral Account" means a cash collateral account maintained for
the benefit of Lenders under the Bank Credit Agreement, established pursuant to
the Bank Credit Agreement.
"Cash Equivalent Investments" means (i) United States Government
Securities, (ii) time deposits and certificates of deposit of any commercial
bank organized in the United States having capital and surplus in excess of
$100,000,000 or a commercial bank organized under the laws of any other country
that is a member of the OECD having total assets in excess of $100,000,000, in
either case, with a maturity date not more than one year from the date of
acquisition, (iii) repurchase obligations with a term of not more than seven (7)
days for underlying securities of the types described in clause (i) above
entered into with any bank meeting the qualifications specified in clause (ii)
above, (iv) direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within ninety (90) days after the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either Standard & Poor's Corporation or Xxxxx'x
Investors Service, Inc. (or, if at any time neither Standard & Poor's
Corporation nor Xxxxx'x Investors Service, Inc. shall be rating such
obligations, then from such other nationally recognized rating services
acceptable to the Shared Collateral Agent), (v) commercial paper issued by the
parent corporation of any commercial bank organized in the United States having
capital and surplus in excess of $100,000,000 or a commercial bank organized
under the laws of any other country that is a member of the OECD having total
assets in excess of $100,000,000, and commercial paper issued by others having
one of the two highest ratings obtainable from either Standard & Poor's
Corporation or Xxxxx'x Investors Service, Inc. (or, if at any time neither
Standard & Poor's Corporation nor Xxxxx'x Investors Service, Inc. shall be
rating such obligations, then from such other nationally recognized rating
services acceptable to the Shared Collateral Agent) and in each case maturing
within one year after the date of acquisition, (vi) overnight bank deposits and
bankers' acceptances at any commercial bank organized in the United States
having capital and surplus in excess of $100,000,000 or a commercial bank
organized under the laws of any other country that is a member of the OECD
having total assets in excess of $100,000,000, (vii) deposits available for
withdrawal on demand with a commercial bank organized in the United States
having capital and surplus in excess of
4
$50,000,000 or a commercial bank organized under the laws of any other country
that is a member of the OECD having total assets in excess of $50,000,000 and
(viii) investments in money market funds substantially all of whose assets
comprise securities of the types described in clauses (i) through (vii).
"Chattel Paper" means any "chattel paper," as such term is defined in
Section 9-102(11) of the UCC, now owned or hereafter acquired by the Borrower
or in which the Borrower now has or hereafter acquires any rights and wherever
located.
"Claims" has the meaning set forth in Section 5.4(a).
"Collateral" means, collectively, the Bank Collateral, the Senior Note
Collateral and the Shared Collateral.
"Collateral Account" means any account established by the Borrower for the
benefit of the Note Agent pursuant to the terms of the Senior Note Documents and
this Agreement and designated as the "Anchor Glass Collateral Account."
"Collection Account" means an account established pursuant to the Bank
Credit Agreement into which funds on deposit in the relevant Sub-Collection
Account shall be transferred pursuant to the Bank Credit Agreement.
"Collection Bank Agreements" means agreements between the Borrower, an
agent under the Bank Credit Agreement and depositary institutions which provide,
among other things, for receipts received in respect of Bank Collateral to be
transferred regularly from each Sub-Collection Account to the appropriate
Collection Account.
"Concentration Account" means an account established pursuant to the Bank
Credit Agreement into which available amounts held in the Collection Accounts
shall be transferred regularly.
"Concentration Account Agreement" means an agreement among the Borrower,
an agent under the Bank Credit Agreement and a depositary institution
establishing a Concentration Account.
"Contract Rights" means all rights of the Borrower (including, without
limitation, all rights to payment) under each Contract.
"Contracts" means all contracts, undertakings, or other agreements (other
than rights evidenced by Chattel Paper, Documents or Instruments) in or under
which the Borrower may now or hereafter have any right, title or interest and
wherever located, including, without limitation, (a) with respect to an Account,
any agreement relating to the terms of payment or the terms of performance
thereof and (b) all interest rate or currency exchange agreements, including,
without limitation, cap, collar, floor, forward or similar agreements, other
rate or currency protection arrangements or other rate or currency management
arrangements.
"Copyrights" means any U.S. copyright to which the Borrower now or
hereafter has title, as well as any application for a U.S. copyright hereafter
made by the Borrower.
5
"Credit Agent" means Congress, in its capacity as collateral agent for the
lenders under the Collateral Agency Agreement, and any successor or replacement
agent under the Collateral Agency Agreement.
"Disbursement Account" means a checking account opened by the Borrower
with a depositary institution for general corporate purposes, including the
purpose of paying trade payables and other operating expenses.
"Disposition" means the sale, assignment, transfer, lease, conveyance or
other disposition by the Borrower of any Anchor Property, including, without
limitation an involuntary disposition as a result of a casualty or condemnation.
"Documents" means any "documents," as such term is defined in Section
9-102(30) of the UCC, now owned or hereafter acquired by the Borrower or in
which the Borrower now has or hereafter acquires any rights and wherever
located.
"Equipment" means any "equipment," as such term is defined in Section 9-
102(33) of the UCC, now owned or hereafter acquired by the Borrower or in which
the Borrower now has or hereafter acquires any rights and wherever located, and,
in any event, shall include, without limitation, all machinery, equipment,
furnishings, fixtures, vehicles and computers and other electronic
data-processing and other office equipment now owned or hereafter acquired by
the Borrower or in which the Borrower now has or hereafter acquires any rights
and wherever located, and any and all additions, substitutions and replacements
of any of the foregoing, wherever located, together with all attachments,
components, parts, equipment and accessories installed thereon or affixed
thereto.
"Future Subsidiary Guarantor" means each of the Borrower's hereafter
created or acquired Subsidiaries which becomes a guarantor of the Senior Note
Obligations or the Bank Credit Agreement Obligations, and their respective
successors.
"General Intangibles" means any "general intangibles," as such term is
defined in Section 9-102(42) of the UCC.
"Goods" means any "goods", as such term is defined in Section 9-102(44) of
the UCC.
"Governmental Agency" means (a) any international, foreign, federal,
state, county or municipal government, or political subdivision thereof, (b) any
governmental agency, authority, board, bureau, commission, department or
instrumentality, (c) any court or administrative tribunal, (d) any
non-governmental agency or entity that is vested by a governmental agency with
applicable jurisdiction over a Person, or (e) any arbitration tribunal or other
non-governmental authority to whose jurisdiction a Person has given its general
consent.
"Hedging Obligations" means, collectively, at any time, all debts,
liabilities and obligations of the Borrower, whether now or hereafter existing,
incurred in connection with any agreement designed to protect the Borrower
against fluctuations in interest rates or currency or commodity values entered
into with the Credit Agent or any Lender.
6
"Indemnitee" has the meaning set forth in Section 5.4(a).
"Instruments" means any "instrument," as such term is defined in Section
9-102(47) of the UCC, now owned or hereafter acquired by the Borrower or in
which the Borrower now has or hereafter acquires any rights and wherever
located, other than instruments that constitute, or are a part of a group of
writings that constitute, Chattel Paper.
"Intercompany Debt" means any indebtedness payable to the Borrower or any
Future Subsidiary Guarantor by the Borrower, any Future Subsidiary Guarantor or
any other Person which is a direct or indirect Subsidiary of any of the
foregoing, or any Person which is an officer, director or employee of the
Borrower or any Future Subsidiary.
"Inventory" means merchandise, inventory and goods, and all additions,
substitutions and replacements thereof, 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 Credit Agent or any Lender from the Borrower's customers and
shall specifically include all "inventory" as such term is defined in the UCC,
now or hereafter owned by the Borrower.
"Law" means, when used in connection with any Person, collectively, all
international, foreign, federal, state and local statutes, treaties, rules,
regulations, standards, guidelines, ordinances, codes, orders and judgments (or
any official interpretation of any of the foregoing) issued by any Governmental
Agency applicable to that Person.
"Lenders" means, collectively, the holders from time to time of the Bank
Credit Agreement Obligations and any administrative, collateral or other agents
for such holders.
"Lenders' Collateral" means, collectively, any and all of the Anchor
Property now or hereafter subject to a Lender's Lien, together with any and all
Proceeds and products thereof.
"Lenders' Lien" means a Lien now or hereafter granted to, or obtained by,
the Lenders or the Credit Agent for the benefit of the Lenders as security for
the payment and performance of any Bank Credit Agreement Obligations.
"Lien" means any mortgage, deed of trust, deed to secure debt, pledge,
hypothecation, assignment for security, security interest, encumbrance, lien or
charge of any kind, whether voluntarily incurred or arising by operation of Law,
by statute, by contract, or otherwise, affecting any Property, including any
agreement to grant any of the foregoing, any conditional sale or other title
retention agreement, any lease in the nature of a security interest, and/or the
filing of or agreement to give any financing statement (other than a
precautionary financing statement with respect to a lease that is not in the
nature of a security interest) under the UCC or comparable Law of any
Jurisdiction as in effect on the date hereof with respect to any Property.
"Note Agent" has the meaning set forth in the introductory paragraph.
7
"OECD" means the Organization for Economic Cooperation and Development.
"Officers' Certificate" means a certificate signed by two officers, one of
whom must be the principal executive officer, principal financial officer or
principal accounting officer of the Borrower.
"Patent" or "Patents" means one or all of the following now owned or
hereafter acquired by the Borrower or in which the Borrower now has or hereafter
acquires any rights, including, without limitation, pursuant to any Patent
License, and wherever located: (a) all letters patent of the United States or
any other country and all applications for letters patent of the United States
or any other country, (b) all reissues, reexaminations, continuations,
continuations-in-part, divisions, and extensions of any of the foregoing, and
(c) all inventions claimed and disclosed in the Patents and any and all trade
secrets and know-how related thereto.
"Patent License" means any written agreement granting any right to make,
use, sell and/or practice any invention or discovery that is the subject matter
of a Patent now owned or hereafter acquired by the Borrower or in which the
Borrower now has or hereafter acquires any rights.
"Person" means any entity, whether an individual, trustee, corporation,
general partnership, limited partnership, joint stock company, trust, estate,
unincorporated organization, business association, tribe, firm, joint venture,
Governmental Agency, or otherwise.
"Proceeds" means "Proceeds," as such term is defined in Section 9-102(64)
of the UCC and, in any event, shall include, without limitation, (a) any and all
Proceeds of any insurance, indemnity, warranty or guaranty payable to the
Borrower from time to time with respect to any of the Collateral, (b) any and
all payments (in any form whatsoever) made or due and payable to the Borrower
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 Agency (or any Person acting under color of governmental authority)
and (c) any and all other amounts from time to time paid or payable under or in
connection with any of the Collateral.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, tangible or intangible.
"Pro Rata Share" means, with respect to any Lender or Senior Noteholder at
any time, a fraction equal to the following amounts owing to such Person (or in
the case of unutilized commitments, the amount of such Person's unutilized
commitment) divided by the sum of the following amounts, in each case, at such
time, (i) the aggregate principal amount of the Senior Notes outstanding at such
time and (ii) the principal balance of all loans owing under the Bank Credit
Agreement, the aggregate amount of unpaid reimbursement obligations owing with
respect to letters of credit issued pursuant to the Bank Credit Agreement, the
aggregate undrawn amount of all outstanding letters of credit issued pursuant to
the BTCC Credit Agreement, the aggregate amount of all Hedging Obligations owing
to any Lender and, so long as the Lenders under the Bank Credit Agreement,
whether immediately or after the giving of notice or passage of time, or both,
would not have the right to terminate their respective, commitments thereunder,
the unutilized amount of such commitments. For purposes of determining whether
at any such
8
time the Lenders have the right (or would have the right after the giving of
notice or passage of time or both) to terminate their respective commitments
under the Bank Credit Agreement, an Officers' Certificate delivered by the
Borrower to the Note Agent and the Shared Collateral Agent at such time
certifying that no such right exists (or would exist after the giving of notice
or passage of time or both) together with a borrowing under the Bank Credit
Agreement within two (2) Business Days after the delivery of such certificate
shall constitute conclusive evidence, for purposes of this Agreement only, that
no such right exists (or would exist after the giving of notice or passage of
time or both) at such time.
"Receivables" means any "account" as such term is defined in the UCC, now
or hereafter owned by the Borrower and, in any event, includes, but is not
limited to, all of the Borrower's rights to payment for goods sold or leased or
services performed by the Borrower, whether now in existence or arising from
time to time hereafter, including, without limitation, rights evidenced by an
account, note, contract, security agreement, chattel paper, or other evidence of
indebtedness or security, together with (a) all security pledged, assigned,
hypothecated or granted to or held by the Borrower to secure the foregoing, (b)
all of the Borrower's right, title and interest in and to any goods, the sale of
which gave rise thereto, (c) all guarantees, endorsements and indemnifications
on, or of, any of the foregoing, (d) all powers of attorney for the execution of
any evidence of indebtedness or security or other writing in connection
therewith, (e) all books, records, ledger cards, and invoices relating thereto,
(f) all notices to other creditors or secured parties, and certificates from
filing or other registration officers, (g) all credit information, reports and
memoranda relating thereto, and (h) all other writings related in any way to the
foregoing.
Remedial Action" means any claim, proceeding or action to foreclose upon,
take possession or control of, sell, lease or otherwise dispose of or in any
other manner realize, take steps to realize or seek to realize upon, the whole
or any part of any Anchor Property, whether pursuant to the UCC, by foreclosure,
by setoff, by self-help repossession, by notification to account debtors, by
deed in lieu of foreclosure, by exercise of power of sale, by judicial action or
otherwise, or the exercise of any other remedies with respect to any Anchor
Property available under any of the Security Documents, or under applicable Law.
"Required Parties" means, at any time, Lenders and Senior Noteholders
holding greater than fifty percent (50%) of the sum of the following amounts at
such time: (i) the aggregate principal amount of the Senior Notes outstanding at
such time and (ii) the principal balance of all loans owing under the Bank
Credit Agreement, the aggregate amount of unpaid reimbursement obligations owing
with respect to letters of credit issued pursuant to the Bank Credit Agreement,
the aggregate undrawn amount of all outstanding letters of credit issued
pursuant to the Bank Credit Agreement, the aggregate amount of all Hedging
Obligations owing to any Lender and, so long as the Lenders under the Bank
Credit Agreement, whether immediately or after the giving of notice or passage
of time, or both, would not have the right to terminate their respective
commitments thereunder, the unutilized amount of such commitments. For purposes
of determining whether at any such time the Lenders have the right (or would
have the right after the giving of notice or passage of time or both) to
terminate their respective commitments under the Bank Credit Agreement, an
Officers' Certificate delivered by the Borrower to the Note Agent at such time
certifying that no such right exists (or would exist after the giving of notice
or passage of time or both) together with a borrowing under the Bank Credit
9
Agreement within two Business Days after the delivery of such certificate shall
constitute conclusive evidence, for purposes of this Agreement only, that no
such right exists (or would exist after the giving of notice or passage of time
or both) at such time.
"Security Documents" means, collectively, the Bank Credit Agreement
Security Documents, the Senior Note Security Documents and the Shared Collateral
Security Documents.
"Senior Note Collateral" has the meaning set forth in Section 3.1(b).
"Senior Note Creditors" means, collectively, the Note Agent and the Senior
Noteholders.
"Senior Note Documents" means the Senior Note Indenture, the Senior Notes,
the Senior Note Security Documents and all other agreements and other documents
evidencing or entered into in connection with the Senior Notes.
"Senior Noteholders" has the meaning set forth in the introductory
paragraph.
"Senior Noteholders' Lien" means a Lien now or hereafter granted to, or
obtained by, the Senior Noteholders or the Note Agent for the benefit of the
Senior Noteholders, as security for the payment and performance of any Senior
Note Obligations.
"Senior Note Indenture" has the meaning set forth in the Recitals.
"Senior Note Obligations" means, collectively, all debts, liabilities and
obligations of the Borrower, whether now or hereafter existing, arising pursuant
to the terms of the Senior Note Documents (including, without limitation, the
Senior Note Indenture, the Senior Notes, the Senior Note Security Documents and
any other document, agreement or instrument executed or delivered in connection
therewith to further evidence the debts, liabilities and obligations of the
Borrower to the Note Agent and the Senior Noteholders).
"Senior Notes" means the 11 1/4% Notes issued by the Borrower in the
original aggregate principal amount of $150,000,000 pursuant to the Senior Note
Indenture, as the same may hereafter be amended, supplemented, amended and
restated or otherwise modified from time to time.
"Senior Note Security Agreement" means the security agreement dated as of
February 5, 1997 made by the Borrower in favor of Bankers Trust Company, as
agent, which was assigned by Bankers Trust Company to the Note Agent for the
benefit of the Senior Noteholders as security for the Borrower's obligations
under the Senior Note Indenture and the Senior Notes.
"Senior Note Security Documents" means, collectively, any and all
documents executed in connection with the Senior Note Indenture or in
furtherance thereof, pursuant to which the Borrower grants to the Senior
Noteholders (whether through the Note Agent or otherwise) a Lien on the Senior
Note Collateral and the Shared Collateral, and, to the extent permitted pursuant
to the terms of this Agreement, as the same may be amended, modified or
10
supplemented from time to time to the extent, and only to the extent, that such
amendment, modification or supplement constitutes a permitted amendment and
consent.
"Shared Collateral" has the meaning set forth in Section 3.1(c).
"Shared Collateral Account" means the account established by the Borrower
for the benefit of the Shared Collateral Agent pursuant to the terms of this
Agreement and designated as the "Anchor Glass Shared Collateral Account."
"Shared Collateral Agent" has the meaning set forth in Section 5.1.
"Shared Collateral Agent's Lien" means the Liens of the Shared Collateral
Agent in the Shared Collateral granted pursuant to the Shared Collateral
Security Documents.
"Shared Collateral Security Documents" means the documents, instruments
and agreements granting the Liens in the Shared Collateral to the Shared
Collateral Agent and all other documents, instruments, certificates and
agreements executed in connection therewith and, to the extent permitted
pursuant to the terms of this Agreement, as the same may be amended, modified or
supplemented from time to time.
"Stock Collateral" means all of the capital stock of any Person owned by
the Borrower or any Future Subsidiary Guarantor.
"Sub-Collection Account" means an account established by the Borrower for
the collection of amounts received by the Borrower from any account debtor, in
addition to cash received from any other source, made in respect of the Bank
Collateral.
"Subsidiary" means any Person of which at least a majority of the capital
stock or other ownership interest having ordinary voting power for the election
of directors or other governing body of said Person is owned by the Borrower,
directly or through one or more Subsidiaries.
"TIA" means The Trust Indenture Act of 1939, as amended, and all rules and
regulations thereunder or issued pursuant thereto.
"Trade Secret Rights" means all trade secrets and proprietary information
necessary to operate the business of the Borrower.
"Trademark" or "Trademarks" means any trademarks and service marks now
held or hereafter acquired by the Borrower (including, without limitation,
pursuant to any Trademark License), which are registered in the United States
Patent and Trademark Office, as well as any unregistered marks used by the
Borrower in the United States and trade dress including logos and/or designs in
connection with which any of these registered or unregistered marks are used.
"Trademark License" means any written agreement granting any right to use
any Trademark or Trademark registration now owned or hereafter acquired by the
Borrower or in which the Borrower now has or hereafter acquires any rights.
11
"UCC" means the Uniform Commercial Code as in effect on the date hereof
in the State of New York, or, if another jurisdiction is specified in this
Agreement, the Uniform Commercial Code as in effect from time to time in such
jurisdiction.
"United States Government Securities" means securities issued directly and
fully guaranteed or insured by the United States of America or any agent or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof).
2. Consents. Subject to the terms and conditions of this Agreement
(including, without limitation, Section 4.2 hereof): the Note Agent, for itself
and on behalf of the Senior Noteholders, consents to (i) the execution and
delivery of the Bank Credit Agreement and the other Bank Credit Agreement
Security Documents; (ii) the incurrence of all Bank Credit Agreement
Obligations; and (iii) the granting of all Lenders' Liens.
3. Priority of Liens: Remedial Actions: Other Agreements.
3.1. Priority of Liens. The Lenders' Liens and the Senior Noteholders'
Liens shall, as between the Lenders and the Senior Noteholders, have the
following priorities:
(a)The Lenders' Liens in all that Anchor Property set forth and
described on Exhibit A hereto (the "Bank Collateral") shall be first priority
Liens in such Property, superior to any Senior Noteholders' Liens in such
Property, and the Senior Noteholders' Liens in such Property, if any, shall be
subordinate to the Lenders' Liens in such Property.
(b)The Senior Noteholders' Liens in all that Anchor Property set forth
and described on Exhibit B hereto (the "Senior Note Collateral") shall be first
priority Liens in such Property, superior to any Lenders' Liens in such
Property, and the Lenders' Liens in such Property, if any, shall be subordinate
to the Senior Noteholders' Liens in such Property.
(c)The Lenders' Liens, the Senior Noteholders' Liens and the Shared
Collateral Agent's Liens in all that Anchor Property set forth and described on
Exhibit C hereto (the "Shared Collateral") shall be pari passu in priority and
subject to the sharing arrangements contained herein.
The foregoing provisions shall be effective at all times during the term of this
Agreement notwithstanding: (i) the initiation of any bankruptcy, moratorium,
reorganization or other solvency proceeding with respect to the Borrower; (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 Anchor Property by the Credit Agent, the Note Agent, any Lender or any
Senior Noteholder; (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 Bank Credit Agreement Obligations or the Senior Note
Obligations is created; (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; or (vii) any other matter whatsoever; and shall
continue in full force and effect unless and until this Agreement shall have
terminated in accordance with Section 6 hereof.
12
3.2. Remedial Actions. Unless and until this Agreement shall have been
terminated in accordance with Section 6 hereof, the Credit Agent and the Note
Agent shall have the right, as between themselves, to take or fail to take
Remedial Actions with respect to any Collateral as follows:
(a) The Credit Agent shall have the sole and exclusive right to take
or fail to take any Remedial Action with respect to the Bank Collateral as
provided in the Bank Credit Agreement Security Documents or under applicable Law
in any manner deemed appropriate by the Credit Agent or the Lenders in its or
their sole discretion (without regard to any Senior Noteholders' Lien, if any,
in such Property), and neither the Note Agent nor any Senior Noteholder shall
take any Remedial Action with respect to the Bank Collateral without the prior
written consent of the Credit Agent;
(b) The Note Agent shall have the sole and exclusive right to take or
fail to take any Remedial Action with respect to the Senior Note Collateral as
provided in the Senior Note Security Documents or under applicable Law in any
manner deemed appropriate by the Note Agent or the Senior Noteholders in its or
their sole discretion (without regard to any Lenders' Lien, if any, in such
Property), and neither the Credit Agent nor any Lender shall take any Remedial
Action with respect to the Senior Note Collateral without the prior written
consent of the Note Agent;
(c) Subject to Sections 3.5 and 3.12, the Required Parties shall have
the sole and exclusive right to take or fail to take any Remedial Action with
respect to the Shared Collateral as provided herein, in the Shared Collateral
Security Documents or under applicable Law in any manner deemed appropriate by
the Required Parties in their sole discretion, and neither the Credit Agent or
any Lender nor the Note Agent or any Senior Noteholder shall take any Remedial
Action with respect to the Shared Collateral without the prior written consent
of the Required Parties (or the Credit Agent and the Note Agent on behalf of the
Required Parties); and
(d) The Credit Agent shall have the sole and exclusive right to adjust
settlement of, and collect the Proceeds of, any and all insurance insuring the
Bank Collateral and the Note Agent shall have the sole and exclusive right to
adjust settlement of and collect the Proceeds of, any and all insurance insuring
the Senior Note Collateral. The Shared Collateral Agent at the direction of the
Required Parties shall have the sole and exclusive right to adjust settlement of
any and all insurance insuring or otherwise constituting the Shared
Collateral. Any such Proceeds received shall be promptly distributed in
accordance with Section 3.3 hereof.
Notwithstanding the foregoing, nothing contained in this Section 3.2 shall
prohibit the Credit Agent, the Lenders, the Note Agent, the Senior Noteholders
or the Shared Collateral Agent from filing a proof of claim in any case
involving the Borrower, as debtor, under Title 11 of the United States Code, as
amended, nor from intervening or participating in any other judicial proceeding
to the extent necessary to establish or preserve its interests, subject in each
case to the provisions of this Agreement.
13
3.3. Priority on Distribution of Proceeds of Collateral. In the event of:
(a) any distribution of any Anchor Property 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 the Borrower, or the application of any Anchor Property to the
payment thereof;
(b) any distribution of the Anchor Property upon the liquidation or
dissolution of the Borrower, or the winding up of the assets or business of the
Borrower;
(c) any realization by any of the Credit Agent, the Note Agent, the
Lenders, the Senior Noteholders or the Shared Collateral Agent with respect to
the Lenders' Liens, the Senior Noteholders' Liens or the Shared Collateral
Agent's Lien, respectively, whether through a Remedial Action or otherwise; or
(d) any Disposition of any Anchor Property, to the extent that any
part of the proceeds of such Disposition are required to be applied to any of
the Bank Credit Agreement Obligations or the Senior Note Obligations or held by
the Credit Agent, the Note Agent or the Shared Collateral Agent in accordance
with the provisions of the Senior Note Documents, the Bank Credit Agreement or
any of the Security Documents, or the provisions of this Agreement;
then, in any such event, as between the Lenders and the Senior Noteholders (i)
all of the Bank Collateral and any Proceeds thereof so distributed, applied or
realized upon shall be distributed or paid to (or retained by) the Credit Agent
for application in accordance with the Collateral Agency Agreement to the Bank
Credit Agreement Obligations to the extent of the Lenders' Liens therein, and,
after the payment in full of all Bank Credit Agreement Obligations then due and
owing, the remaining amount of such Proceeds shall be distributed or paid to (or
retained by) the Note Agent for application to the Senior Note Obligations, (ii)
all of the Senior Note Collateral and any Proceeds thereof distributed, applied
or realized upon shall be distributed or paid to (or retained by) the Note Agent
for application to the Senior Note Obligations to the extent of the Senior
Noteholders' Liens therein and, after the payment in full of all Senior Note
Obligations then due and owing, the remaining amount of such Proceeds shall be
distributed or paid to (or retained by) the Credit Agent or any Lender for
application to the Bank Credit Agreement Obligations, and (iii) all of the
Shared Collateral and any Proceeds thereof so distributed, applied or realized
upon shall be distributed, first, to the Shared Collateral Agent to pay the
Shared Collateral Agent's fees, expenses and indemnities provided for in this
Agreement and in the Shared Collateral Security Documents, in each case, to the
extent related to its duties, obligations and liabilities as Shared Collateral
Agent or otherwise related to the Shared Collateral and, second, to the Credit
Agent and the Note Agent for application to the Bank Credit Agreement
Obligations and the Senior Note Obligations, respectively. Any amounts described
in Clause (iii) above available to be distributed to the Credit Agent and the
Note Agent shall be distributed to each based upon the Pro Rata Shares of the
Lenders and the Senior Noteholders at the time of the commencement of any
Remedial Action giving rise to such proceeds until the respective Bank Credit
Agreement Obligations and the Senior Note Obligations are paid in full, or if
not arising from a Remedial Action the Pro Rata Shares of the Lenders and the
Senior Noteholders at the time of such distribution until the respective Bank
Credit Agreement Obligations and the
14
Senior Note Obligations are paid in full. Any amounts paid to the Credit Agent
and the Note Agent shall be allocated to the Lenders and the Senior Noteholders,
respectively, in accordance with the terms of the Collateral Agency Agreement
and the Senior Note Documents, respectively.
The Note Agent and the Credit Agent agree that in the case of any such
distribution, realization or application of any proceeds from the sale of other
Disposition of any Anchor Property which does not constitute Bank Collateral,
Senior Note Collateral or Shared Collateral, such proceeds shall be distributed
to the Credit Agent and the Note Agent for application to the Bank Credit
Agreement Obligations and the Senior Note Obligations, respectively, as if such
proceeds were Shared Collateral and distributed pursuant to the provisions of
this Section 3.3.
3.4. Agency for Perfection; Parties to Hold Proceeds in Trust. The Note
Agent and the Credit Agent hereby appoint each other as agent for the purposes
of perfecting their respective Liens in the Collateral described hereunder. In
the event that:
(a) the Credit Agent, any Lender or the Shared Collateral Agent
obtains possession or control (within the meaning of Section 9-106 of the UCC)
of any of the Senior Note Collateral or receives any Proceeds from any Remedial
Action with respect to Senior Note Collateral or any Disposition of Senior Note
Collateral described in Section 3.3 hereof or as a result of its Lien on any
Senior Note Collateral at any time prior to payment in full of all Senior Note
Obligations;
(b) the Note Agent or the Shared Collateral Agent obtains possession
or control (within the meaning of Section 9-106 of the UCC) of any of the Bank
Collateral or receives any Proceeds from any Remedial Action with respect to
Bank Collateral or any Disposition of Bank Collateral described in Section 3.3
hereof or as a result of its Lien on any Bank Collateral at any time prior to
payment in full of all Bank Credit Agreement Obligations; or
(c) the Credit Agent, any Lender, the Note Agent or any Senior
Noteholder receives any Proceeds from any Remedial Action with respect to the
Shared Collateral, or any Disposition of the Shared Collateral at any time;
then, in any such event, the party receiving such Proceeds shall (unless
otherwise provided by Law) hold the same in trust for the party entitled to
receive the same and promptly notify and pay over the same to such party for
application to the Bank Credit Agreement Obligations (in the case of the Credit
Agent) and to the Senior Note Obligations (in the case of the Note Agent) or for
distribution to the Credit Agent and the Note Agent, pursuant to Section 3.3 (in
the case of the Shared Collateral Agent).
3.5. Dispositions of Collateral; Consents. In the event of a Disposition
by the Borrower of all or any portion of the Anchor Property, either:
(a) on a basis permitted by or consented to under the terms of the
Bank Credit Agreement and the Senior Note Documents, or
15
(b) at the request of or pursuant to the action of the Credit Agent,
in the case of Bank Collateral, or of the Note Agent, in the case of Senior Note
Collateral, following the occurrence and during the continuance of an event of
default under the Bank Credit Agreement or the Senior Note Documents, as the
case may be, whether as a result of or in lieu of a Remedial Action;
then, in either such event, provided that the net Proceeds of such Disposition
are (i) in the case of Bank Collateral, applied in accordance with the
requirements set forth in the Collateral Agency Agreement and (II) in the case
of Senior Note Collateral, applied to reduce the Senior Note Obligations, held
by the Note Agent (in the Collateral Account or otherwise) or otherwise applied
in accordance with the requirements set forth in the Senior Note Documents, each
of the Credit Agent and the Lenders in the case of Senior Note Collateral and
each of the Note Agent and the Senior Noteholders in the case of Bank
Collateral, shall be deemed to have consented to such Disposition
(notwithstanding any provision of the Security Documents, the Bank Credit
Agreement or the Senior Note Documents to the contrary) and no further consent
thereto on the part of any thereof shall be required.
(c) Notwithstanding any other provision to the contrary set forth in
this Agreement, upon foreclosure of the Senior Note Collateral; the Note Agent
may Dispose of Shared Collateral without the consent of the Credit Agent, the
Shared Collateral Agent or the Lenders and without any continuing Lenders' Lien,
and the Proceeds of any such Disposition shall constitute Senior Note Collateral
and not Bank Collateral or Shared Collateral; provided that (a) if such
Disposition occurs after an event of default has occurred under any Bank Credit
Agreement, the Credit Agent shall have a license to use such Shared Collateral
on the same terms as is provided for in respect of Trademarks pursuant to
Section 3.12 of this Agreement and (b) any such Disposition (after giving effect
to any license referred to in (a)) shall not deprive the Credit Agent of access
to Shared Collateral sufficient to enable it to manufacture and sell the Bank
Collateral.
3.6. Payment Invalidated. In the event that any of the Bank Credit
Agreement Obligations or Senior Note 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 States
Code, or any similar Law, or the settlement of any claim in respect thereof),
formerly paid or satisfied Bank Credit Agreement Obligations or Senior Note
Obligations become unpaid or unsatisfied, the terms and conditions of this
Agreement shall be reinstated, notwithstanding any prior termination of this
Agreement pursuant to Section 6, and all provisions of this Agreement shall
again be operative until all such obligations are again paid in full.
3.7. Notice of Acceleration, Etc. Each of the Credit Agent and the Note
Agent Agrees to Deliver to the Other:
(a) in the case of the Credit Agent, (i) prompt written notice of the
acceleration of the Bank Credit Agreement Obligations pursuant to the Bank
Credit Agreement (such notice to be provided in the same mariner and
substantially contemporaneously with any notice provided to the Borrower), and
(ii) prompt written notice of any Remedial Action with respect to Bank
Collateral; and
16
(b) in the case of the Note Agent, (i) prompt written notice of the
acceleration of the Senior Note Obligations pursuant to the Senior Note
Documents (such notice to be provided in the same manner and substantially
contemporaneously with any notice provided to the Borrower), and (ii) prompt
written notice of any Remedial Action with respect to Senior Note Collateral.
3.8. Other Collateral. Each of the Credit Agent, for itself and on behalf
of the Lenders, and the Note Agent, for itself and on behalf of the Senior
Noteholders, agrees that:
(a) in the event any Lien on Anchor Property is granted to or
perfected by either party, the party to which such Lien is granted or by which
it is perfected shall cooperate in all reasonable respects with the other to
permit the other concurrently to be granted or to perfect a Lien in such Anchor
Property to the extent that the other is then entitled to a Lien on such Anchor
Property under the terms of the Senior Note Documents (including without
limitation, the Senior Noteholders' Security Documents), in the case of the Note
Agent, or under the terms of the Bank Credit Agreement and the Bank Credit
Agreement Security Documents, in the case of the Credit Agent, in each case as
then in effect, and subject to the terms and conditions of this Agreement
(including, without limitation, that the respective Liens of the Credit Agent
and the Note Agent shall have the priorities set forth in this Agreement); and
(b) Win the event that either the Credit Agent or the Note Agent has
possession of any Anchor Property subject to a Lenders' Lien or a Senior
Noteholders' Lien, the Note Agent, if such Anchor Property constitutes Bank
Collateral and such Property is in the possession of the Credit Agent, or the
Note Agent, if such Anchor Property constitutes Senior Note Collateral and such
Property is in the possession of the Credit Agent, shall hold such Anchor
Property, for the benefit of such other party for purposes of perfecting such
other party's Lien on such Anchor Property pursuant to the UCC, as in effect on
the date hereof in the applicable jurisdiction, and this Agreement shall
constitute an authenticated record in which such possessing party acknowledges
that it will hold such Anchor Property for, in addition to its own benefit, the
benefit of such other party.
3.9. Contesting Liens. Each of the Credit Agent, for itself and on behalf
of the Lenders, and the Note Agent, for itself and on behalf of the Senior
Noteholders, agrees that it shall not contest the validity, perfection, priority
or enforceability of any Lenders' Lien in Bank Collateral, in the case of the
Note Agent and the Senior Noteholders, or any Senior Noteholders' Lien in Senior
Note Collateral, in the case of the Credit Agent and the Lenders, so long as
such Lien is permitted by this Agreement.
3.10. Further Assurances. From time to time during the term hereof:
(a) each of the Credit Agent and the Note Agent, at the reasonable
request of the other, shall execute and deliver to the other such notices of the
subordination and other provisions of this Agreement, in recordable form, and
shall execute and deliver such other documents and instruments and take such
other actions, as shall reasonably be necessary to carry out the intentions or
to facilitate the performance of this Agreement including, without limitation,
in connection with any Remedial Action of which such Person has received notice;
and
17
(b) if, in connection with any Remedial Action permitted by Section
3.2 or any Disposition of any Anchor Property contemplated by Section 3.5, it
becomes necessary or advisable for the Credit Agent, the Note Agent or the
Borrower to obtain a release or discharge of any subordinate Lenders' Lien or
any subordinate Senior Noteholders' Lien in any such Property in order to convey
title thereto unencumbered by such Lien, then so long as such Remedial Action or
Disposition, and the application of the proceeds derived therefrom, have been or
will contemporaneously be accomplished in conformity with this Agreement, the
Credit Agent or the Note Agent (to the extent permitted by the TIA), as
appropriate, shall, upon the request of the other (or of the Borrower), execute
such instruments of release or discharge of such Liens, in recordable form, as
may be reasonable and appropriate in the circumstances; provided, however, that
any such release or discharge may, to the extent required under the Bank Credit
Agreement, the Bank Credit Agreement Security Documents or the Senior Note
Documents, be expressly conditioned upon the requirement that any net Proceeds
of such Remedial Action or Disposition in excess of the amount necessary to
satisfy the Bank Credit Agreement Obligations or Senior Note Obligations, as the
case may be, shall be paid over to the other for application to the Bank Credit
Agreement Obligations (in the case of the Credit Agent) and to the Senior Note
Obligations (in the case of the Note Agent) or as otherwise provided by Law.
3.11. Access to Collateral. (a) Each of the Credit Agent and the Note
Agent agrees to allow the other and its respective agents and employees
reasonable access to any Anchor Property in its possession or under its control,
including, without limitation, any Anchor Real Property and any customer lists,
software, data bases, business records data and other books and records of the
Borrower pertaining to any of the Collateral, for the purposes of any Remedial
Action then permitted by this Agreement and the relevant Security Documents. In
the event such utilization of the Senior Note Collateral is solely for the
purpose of removing and realizing on Bank Collateral, the Lenders shall
indemnify the Senior Noteholders from all damage to or deterioration of the
Senior Note Collateral during such utilization, normal wear and tear excepted.
(b) in the event such utilization of the Senior Note Collateral is for
the purpose of processing and converting raw materials (including
work-in-process) into finished goods, the Lenders shall, in addition to the
indemnity referenced in paragraph (a) above, pay to the Senior Noteholders the
incremental costs (i.e., those costs which are directly attributable to the
Credit Agent's utilization of such Senior Note Collateral over and above any
such costs the Senior Noteholders would have incurred whether or not the Credit
Agent had so utilized the Senior Note Collateral) incurred by the Senior
Noteholders on account of utility rates and similar charges and any increased
insurance costs which the Senior Noteholders are required to pay as a result of
such utilization.
(c) If, and only if, the Credit Agent's utilization of the Senior Note
Collateral is materially disruptive to the operations of the plant and facility,
the Credit Agent shall pay to the Senior Noteholders fair market value
compensation on a weekly basis in respect of its use of the plant and facility
proportionate to the amount of disruption to the operations of the plant and
facility provided that if in the event the Credit Agent and the Senior
Noteholders are unable to agree as to the amount of such fair market value
compensation they shall submit such dispute to arbitration.
18
(d) Nothing in this Section 3.11 shall prevent the Note Agent or the
Credit Agent from entering into a contract of sale, transfer or other
disposition of, or otherwise foreclosing on, any of the Senior Note Collateral
or Bank Collateral so long as such contract provides, or such foreclosure is
subject to providing, the Credit Agent or the Note Agent, as the case may be,
with the same access to such Collateral as provided by this Section 3.11.
(e) The Note Agent agrees that it shall not take any legal action or
commence any legal proceeding to prevent the Credit Agent's use of the Senior
Note Collateral as provided in this Section 3.11 or the Credit Agent's
non-exclusive use of any Patents, Patent Licenses or General Intangibles
necessary or desirable to convert raw materials constituting Bank Collateral
into inventory, to the extent that the Borrower has granted the Credit Agent the
right to use any such property for such purpose.
3.12. Trademark Licenses. (a) The Note Agent consents to the granting by
the Borrower to the Credit Agent of a nonexclusive license to use each Trademark
of the Borrower to enable them to manufacture and sell the Bank Collateral. Such
license and such right shall be world-wide and royalty free. The Credit Agent
covenants and agrees that it will use reasonable efforts after the acceleration
of the Bank Credit Agreement Obligations to obtain possession of the Bank
Collateral and to promptly terminate such license with respect to any Trademark
by notice to the Note Agent at the time any such Property (in the judgment of
the Credit Agent) is no longer necessary or desirable in connection with the
manufacture or sale of the Bank Collateral. In addition to the foregoing, the
Note Agent agrees that, notwithstanding anything to the contrary contained in
Section 3.1, the Senior Noteholders' Lien in all such Trademarks shall be
subject to the Credit Agent's interest therein by virtue of such license or
sublicense (that is, foreclosure on such Lien will not terminate such license or
sublicense). The right of the Note Agent to take Remedial Actions with respect
to such Trademarks shall not be affected by the immediately preceding sentence
or any provision set forth in Section 3.12(d), but any conveyance by the Note
Agent of such Trademarks and Trademark Licenses or any interest therein shall be
subject to the aforesaid limited licenses granted in favor of the Credit Agent
or the prior security interest of the Credit Agent to the extent of such
security interest set forth in Section 3.12(d).
(b) The Credit Agent acknowledges that, to the extent that the Note
Agent shall have the right to use or license the Trademarks, the Note Agent
shall have the right to grant nonexclusive licenses and sublicenses in the
Trademarks and the Trademark Licenses to Persons other than the Credit Agent
withstanding the grant of the license to the Credit Agent contemplated by
Section 3.12(a).
(c) The Credit Agent shall not have any right to assign, convey,
transfer or grant licenses and sublicenses in the Trademarks and the Trademark
Licenses to any other Person, other than, subject to the limitations of this
Section 3.12, in connection with the uses permitted by Section 3.12(a) above to
any Person acquiring Inventory from the Credit Agent in connection with the
exercise by the Credit Agent of its rights as a secured creditor of the Borrower
with respect to such Inventory, and any purported assignment, conveyance,
transfer or grant (except as expressly permitted herein) shall be void.
19
(d) Notwithstanding anything to the contrary set forth in this
Agreement, in the event that the trademark license granted to the Credit Agent
referred to in Section 3.12(a) above, does not for any reason (including,
without limitation, by reason of the occurrence of any bankruptcy, insolvency or
other similar event with respect to the Borrower) confer on the Credit Agent the
rights and benefits contemplated thereby, then the security interest of the
Credit Agent in the Trademarks shall be pari passu with the security interest of
the Note Agent, solely to the extent necessary to confer on the Credit Agent the
use of the Trademarks as contemplated by such trademark license. Notwithstanding
anything in the immediately preceding sentence to the contrary, in the case of
any Disposition of any of the Trademarks, any Proceeds of such Disposition shall
constitute Senior Note Collateral and otherwise be distributed and applied as
Senior Note Collateral in accordance with the terms of this Agreement. The
rights of the Note Agent to take Remedial Action with respect to such Trademarks
shall not be affected by such security interest, but any conveyance by the Note
Agent of such Trademarks or any interest therein shall be subject to the Credit
Agent's security interest, but only to the extent of such security interest as
provided in this Section 3.12(d).
4. Reliance, Waivers, Etc.
4.1. Creation of Future Obligations. (a) All of the Bank Credit
Agreement Obligations shall be deemed to have been funded by the Lenders and
incurred by the Borrower in reliance upon this Agreement, and the Note Agent
and each Senior Noteholder expressly waive notice to the Note Agent or any
Senior holder of the acceptance of the subordination and other agreements set
forth herein, notice of reliance on such subordination and other agreements and
notice of the creation of any of the Bank Credit Agreement Obligations after the
date hereof, and agree that the Lenders shall be entitled to rely upon the
subordination and other agreements set forth herein at all times for all
purposes in connection with the Bank Credit Agreement Obligations.
(b) All of the Senior Note Obligations shall be deemed to have
been funded by the Senior Noteholders and incurred by the Borrower in reliance
upon this Agreement, and the Credit Agent and each Lender expressly waive notice
to the Credit Agent or any Lender of the acceptance of the subordination and
other agreements set forth herein, notice of reliance on such subordination and
other agreements and notice of the creation of any of the Senior Note
Obligations after the date hereof and agree that the Senior Noteholders shall be
entitled to rely upon the subordination and other agreements set forth herein at
all times for all purposes in connection with the Senior Note Obligations.
4.2. Right to Amend, Etc. As between the Lenders and the Senior
Noteholders:
(a)The Credit Agent and the Lenders 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 Note Agent or any Senior Noteholder,
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 Bank Credit
Agreement Obligations, or obtain, release, or dispose of any Collateral
therefor, or amend or supplement in any manner the Bank Credit Agreement, the
Bank Credit Agreement Security Documents or any other agreements or instruments
evidencing, securing or
20
relating to the Bank Credit Agreement Obligations, and this Agreement shall
continue in full force and effect with respect to all such Bank Credit Agreement
Obligations, provided, however, that the Credit Agent shall comply with all
applicable provisions of this Agreement in respect of any of the foregoing; and
(b) The Note Agent and the Senior Noteholders 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 Credit Agent or any Lender,
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 Senior Note
Obligations, or obtain, release, or dispose of any Collateral therefor, or amend
or supplement in any manner the Senior Note Indenture, the Senior Note Security
Documents or any other agreements or instruments evidencing, securing or
relating to the Senior Note Obligations, and this Agreement shall continue in
full force and effect with respect to all such Senior Note Obligations,
provided, however, that the Note Agent shall comply with all applicable
provisions of this Agreement in respect of any of the foregoing.
4.3. Responsibility For Credit Decisions. No Duty to Inform Other
Parties
(a) The Note Agent has, independently and without reliance on
the Credit Agent, any Lender or the directors, officers, agents, employees or
attorneys of any thereof, and instead in reliance upon information supplied to
it on behalf of the Borrower and upon such other information as it has deemed
appropriate (including, without limitation, all such information as it deemed
advisable with respect to the Borrower's compliance or non-compliance with any
environmental Laws), made its own independent decision to enter into the Senior
Note Documents and to serve as Note Agent thereunder and under the Senior Note
Security Documents, and the Note Agent shall, for itself and on behalf of the
Senior Noteholders, independently and without reliance upon the Credit Agent,
any Lender or the directors, officers, agents, employees or attorneys of any
thereof, continue to make its own independent analysis and decisions in acting
or not acting under the Senior Note Documents.
(b) The Credit Agent has, independently and without reliance
on the Note Agent, any Senior Noteholder or the directors, officers, agents,
employees or attorneys of any thereof, and instead in reliance upon information
supplied to it on behalf of the Borrower and upon such other information as it
has deemed appropriate (including, without limitation, all such information as
it deemed advisable with respect to the Borrower's compliance or non-compliance
with any environmental Laws), made its own independent decision to enter into
the Collateral Agency Agreement and to serve as the Credit Agent thereunder and
the Credit Agent shall, for itself and on behalf of the Lenders, independently
and without reliance upon the Note Agent, any Senior Noteholder or the
directors, officers, agents, employees or attorneys of any thereof, continue to
make its own independent analysis and decisions in acting or not acting under
the Collateral Agency Agreement and the Bank Credit Agreement Security
Documents.
(c) Neither the Credit Agent nor any Lender shall have any
present or future duty or responsibility to the Note Agent or any Senior
Noteholder to advise it of information known to any of them regarding the
financial condition of the Borrower or of any circumstances bearing upon the
risk of nonpayment of the Bank Credit Agreement Obligations or the Senior Note
Obligations and the Note Agent acknowledges that neither the Credit Agent
21
nor any Lender has made any representations or warranties to the Note Agent or
any Senior Noteholder with respect to the due execution, delivery, validity or
enforceability of the Bank Credit Agreement or the Bank Credit Agreement
Security Documents, the validity or perfection of the Lenders' Liens, the
validity or enforceability of the Bank Credit Agreement Obligations, the
existence, condition or value of any of the Bank Collateral as to any other
matter whatsoever. If, notwithstanding the foregoing, any such information is
conveyed by the Credit Agent or any Lender to the Note Agent or any Senior
Noteholder, neither the Credit Agent nor any Lender shall have any
responsibility to the Note Agent or any Senior Noteholder for the accuracy or
completeness of any such information, nor any continuing duty or responsibility
to advise the Note Agent or any Senior Noteholder of any inaccuracy in such
information that is subsequently discovered, or of any updated or subsequent
information, whether or not of like kind.
(d) Neither the Note Agent nor any Senior Noteholder shall
have any present or future duty or responsibility to the Credit Agent or any
Lender to advise it of information known to any of them regarding the financial
condition of the Borrower or of any circumstances bearing upon the risk of
nonpayment of the Senior Note Obligations or the Bank Credit Agreement
Obligations and the Credit Agent on behalf of itself and each Lender
acknowledges that neither the Note Agent nor any Senior Noteholder has made any
representations or warranties to the Credit Agent or any Lender with respect to
the due execution, delivery, validity or enforceability of the Senior Note
Documents, the validity or perfection of the Senior Noteholders' Liens, the
validity or enforceability of the Senior Note Obligations, the existence,
condition or value of any of the Senior Noteholders' Collateral or as to any
other matter whatsoever. If, notwithstanding the foregoing, any such information
is conveyed by the Note Agent or any Senior Noteholder to the Credit Agent or
any Lender, neither the Note Agent nor any Senior Noteholder shall have any
responsibility to the Credit Agent or any Lender for the accuracy or
completeness of any such information, nor any continuing duty or responsibility
to advise the Credit Agent or any Lender of any inaccuracy in such information
that, is subsequently discovered, or of any updated or subsequent information,
whether or not of like kind.
4.4. Order of Enforcement of Remedial Actions. Subject to all of the
terms and conditions of this Agreement, including, without limitation, Section
3.3:
(a) The Credit Agent and the Lenders shall have the right at
any and all times to determine the order, in accordance with the terms of the
Collateral Agency Agreement, in which (i) any Remedial Action or other recourse
is sought against the Borrower or any other obligor with respect to the Bank
Credit Agreement Obligations, and (ii) any or all of the Lenders' Liens shall be
enforced; and the Note Agent, on behalf of itself and each Senior Noteholder,
hereby waives any and all rights to require that the Credit Agent pursue or
exhaust any rights or remedies with respect to the Borrower or any Anchor
Property prior to exercising its rights and remedies with respect to the Bank
Collateral or in any other manner to require the marshalling of assets or
security in connection with the exercise by the Credit Agent or any Lender of
any Remedial Action with respect to the Bank Credit Agreement Obligations and
the Bank Collateral.
(b) The Note Agent and the Senior Noteholders shall have the
right at any and all times to determine the order in which (i) any Remedial
Action or other recourse is
22
sought against the Borrower or any other obligor with respect to the Senior Note
Obligations, and (ii) any or all of the Senior Noteholders' Liens shall be
enforced, and the Credit Agent, on behalf of itself and the Lenders, hereby
waives any and all rights to require that the Note Agent pursue or exhaust any
rights or remedies with respect to the Borrower or any Anchor Property prior to
exercising its rights and remedies with respect to Senior Note Collateral or in
any other manner to require the marshalling of assets or security in connection
with the exercise by the Note Agent or any Senior Noteholder of any Remedial
Action with respect to Senior Note Obligations and Senior Note Collateral.
4.5. Waiver of Liability For Actions Taken With Respect To Obligations
and Collateral. (a) Except as provided in Section 3.11 (b), neither the Credit
Agent nor any Lender shall have any liability to the Note Agent or any Senior
Noteholder for, and the Note Agent, on behalf of itself and each Senior
Noteholder, hereby waives to the extent permitted by applicable Law any claim,
right, action or cause of action which it may now or hereafter have against the
Credit Agent or any Lender (including, without limitation, any and all claims,
rights, actions or causes of action that the Note Agent or any Senior Noteholder
may otherwise have against the Agent or any Lender under Sections 9-207 and
9-625 of the UCC) arising out of any and all actions which any Lender or the
Credit Agent, in good faith, takes or omits to take with respect to the Bank
Credit Agreement Obligations, any obligor with respect to the Bank Credit
Agreement Obligations, or any Bank Collateral, including, without limitation,
actions with respect to: the creation, perfection or continuation of Liens with
respect to any Bank Collateral; any Remedial Action or Disposition of any Bank
Collateral; the release of any Bank Collateral, the custody, valuation,
protection, preservation, use or depreciation of any Bank Collateral; the
realizing upon or failure to realize upon any Bank Collateral; or the collection
of the Bank Credit Agreement Obligations. To the extent that any of the
foregoing waivers is not permitted by applicable law the Note Agent agrees that
the applicable standard by which any non-waivable rights, duties or claims are
to be measured shall be that neither the Credit Agent nor any Lender shall have
any liability or responsibility to the Note Agent or to any Senior Noteholders
for any actions or omissions other than actions or omissions constituting gross
negligence or wilful misconduct.
(b) Neither the Note Agent nor any Senior Noteholder shall
have any liability to the Credit Agent or the Lenders for, and the Credit Agent
on behalf of itself and each Lender, hereby waives any claim, right, action or
cause of action which it may now or hereafter have against the Note Agent or any
Senior Noteholder (including, without limitation, any and all claims, rights,
actions or causes of action that the Credit Agent or any Lender may otherwise
have against the Note Agent or any Senior Noteholder under Sections 9-207 and
9-625 of the UCC) arising out of, any and all actions which the Note Agent or
any Senior Noteholder, in good faith, takes or omits to take with respect to the
Senior Note Obligations, any obligor with respect to the Senior Note Obligations
or any Senior Note Collateral, including, without limitation, actions with
respect to, the creation, perfection or continuation of Liens with respect to
any Senior Note Collateral, any Remedial Action or Disposition of any Senior
Note Collateral, the release of any Senior Note Collateral; the custody,
valuation, protection, preservation, use or depreciation of any Senior Note
Collateral; the realizing upon or failure to realize upon any Senior Note
Collateral; or the collection of the Senior Note Obligations. To the extent that
any of the foregoing waivers is not permitted by applicable law, the Credit
Agent agrees that the applicable standard by which any non-waivable rights,
duties or claims are to be measured shall
23
be that neither the Note Agent nor any Senior Noteholder shall have any
liability or responsibility to the Credit Agent or to any Lender for any actions
or omissions other than actions or omissions constituting gross negligence or
wilful misconduct.
5. Agency.
5.1. Appointment of Shared Collateral Agent; Powers and Limitations.
(a) Subject to the resignation and removal provisions of Section 5.5 hereof, the
Credit Agent hereby irrevocably designates, appoints, and authorizes the Note
Agent as Shared Collateral Agent hereunder (the Note Agent in such capacity
being hereinafter referred to as the "Shared Collateral Agent") upon the written
instruction of the Credit Agent to take such action, including, without
limitation, the exercise of rights and the pursuit of remedies pursuant to this
Agreement and the Shared Collateral Security Documents, as agent on its behalf
and to exercise such other powers under this Agreement and the Shared Collateral
Security Documents as are expressly delegated to the Shared Collateral Agent by
the terms hereof and thereof, together with such powers as are reasonably
incidental thereto.
(b) Nothing herein or in the Shared Collateral Security
Documents shall impose or be construed to impose on the Shared Collateral Agent
any duties or obligations, other than those expressly provided for herein or
therein or any fiduciary relationship with the Credit Agent or the Note Agent
and no implied covenants, functions or responsibilities shall be read into the
Agreement or the Shared Collateral Security Documents.
5.2. Instructions. Voting and Meetings. (a) Notwithstanding any
provisions of this Agreement, the Shared Collateral Agent is authorized, but not
obligated, (i) to take any action reasonably required to perfect or continue the
perfection of the Liens on the Shared Collateral for the benefit of the Lenders
and the Senior Noteholders and (ii) when instructions from the Required Parties
have been requested by the Shared Collateral Agent but have not yet been
received, to take any action which the Shared Collateral Agent, in good faith,
believes to be reasonably required to promote and protect the interests of the
Lenders and the Senior Noteholders in the Shared Collateral, provided that once
instructions have been received, the actions of the Shared Collateral Agent
shall be governed thereby and the Shared Collateral Agent shall not take any
further action which would be contrary thereto.
(b) As to any matters relating to the Shared Collateral or the
Shared Collateral Security Documents not otherwise expressly delegated to the
Shared Collateral Agent, the Note Agent or the Credit Agent by the Bank Credit
Agreement, the Security Documents or the Senior Note Documents, the Shared
Collateral Agent shall act or refrain from acting on the instructions of the
Required Parties. Without limiting the generality of the foregoing, in the event
the Shared Collateral Agent shall act or refrain from acting upon the direction
of Lenders constituting the Required Parties, such action or inaction, as the
case may be, shall not constitute a breach of any fiduciary obligation which the
Shared Collateral Agent might owe to the Note Agent or the Senior Noteholders
even if the Note Agent or the Senior Noteholders are damaged by such action or
inaction.
(c) If, with respect to a proposed action to be taken by it,
the Shared Collateral Agent shall determine in good faith that the provisions of
this Agreement or any
24
Shared Collateral Security Document relating to the functions or
responsibilities or discretionary powers of the Shared Collateral Agent are or
may be ambiguous or inconsistent, the Shared Collateral Agent shall notify the
Credit Agent and the Note Agent, identifying the proposed action and the
provisions that it considers are or may be ambiguous or inconsistent, and may
decline either to perform such function or responsibility or to exercise such
discretionary power unless it has received the written confirmation of the
Required Parties that the Required Parties concur in the circumstances that the
action proposed to be taken by the Shared Collateral Agent is consistent with
the terms of this Agreement or such Shared Collateral Security Document or is
otherwise appropriate. The Shared Collateral Agent shall be fully protected in
acting or refraining from acting upon the confirmation of the Required Parties
in this respect, and such confirmation shall be binding upon the Shared
Collateral Agent, the Lenders the Note Agent and the Senior Noteholders.
(f) Notwithstanding any provisions herein, the Shared
Collateral Agent shall not be required to take any action that exposes or, in
the good faith judgment of the Shared Collateral Agent may expose, the Shared
Collateral Agent or its officers, directors, agents or employees to personal
liability unless the Shared Collateral Agent shall be adequately indemnified as
provided herein, or that is or in the good faith judgment of the Shared
Collateral Agent may be contrary to the Shared Collateral Security Documents or
applicable law.
(e) Except for action expressly required of the Shared
Collateral Agent hereunder the Shared Collateral Agent shall in all cases be
fully justified in failing or refusing to act hereunder unless it shall be
indemnified (in addition to the indemnity provided by Section 5.4 hereof) to its
satisfaction by the Credit Agent and the Note Agent in advance against any and
all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action.
(f) Notwithstanding anything to the contrary in this Agreement
or the Shared Collateral Security Documents, the Shared Collateral Agent shall
not be required to exercise any rights or remedies under this Agreement or any
of the Shared Collateral Security Documents or give any consent under this
Agreement or any of the Shared Collateral Security Documents or enter into any
agreement amending, modifying, supplementing or waiving any provision of this
Agreement or any Shared Collateral Security Document unless it shall have been
directed to do so by the Required Parties.
5.3. Disclaimer: Good Faith Reliance on Advice and Information. (a)
Neither the Shared Collateral Agent nor any of its directors, officers, agents
or employees shall be liable for any action taken or omitted to be taken by it
or them under or in connection with the Shared Collateral Security Documents,
except for its or their own gross negligence, willful misconduct or knowing
violations of law. Without limiting the generality of the foregoing, the Shared
Collateral Agent (i) may consult with legal counsel, independent public
accountants, appraisers and other experts selected by the Shared Collateral
Agent and shall not be liable for any action taken or omitted to be taken in
good faith in accordance with the advice of such counsel, accountants,
appraisers or experts, and (ii) shall incur no liability under or in respect of
Shared Collateral Security Documents by acting upon any representation or
warranty of the Borrower made in connection therewith or by relying upon any
written information supplied by any predecessor Shared Collateral Agent(s) or by
acting upon any notice, instruction, consent,
25
certificate or other instrument, writing or communication (which may be by
telegram, cable, telex or telephone) in good faith believed by it to be genuine
and to have been signed, sent or made by the proper party or parties.
(b) For purposes of this Section 5.3, "known" shall mean that
information has come to the attention of an officer of a party with
responsibility for the applicable transaction under this Agreement giving such
party actual knowledge of the existence or non-existence of the fact in
question.
(c) The Shared Collateral Agent shall not be responsible to
any Person for (i) the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Shared Collateral Security Documents,
any Shared Collateral provided thereunder, or any other instrument or document
furnished pursuant thereto; (ii) the priority of any Lien granted under the
Shared Collateral Security Documents; (iii) any omissions or errors on the part
of government officials, failure of mail deliveries, losses of documents by
Federal Express or other courier services, mistakes by title companies or lien
search companies, or other similar events; (iv) any recital, statement,
representation or warranty made by the Borrower, or any affiliate of the
Borrower or any officer, employee or agent of any such party in the Shared
Collateral Security Documents or any certificate or other document referred to
or provided for therein, (v) any failure by the Borrower, or any affiliate of
the Borrower to perform its obligations under the Shared Collateral Security
Documents of any document or instrument related thereto; or (vi) any conflict
among the Shared Collateral Security Documents or any other instrument or
document to which the Borrower or any Lender or Senior Noteholder is a party.
The Shared Collateral Agent shall not be under any obligation to the Credit
Agent, the Note Agent, the Lenders or the Senior Noteholders to ascertain or to
inquire as to the observance or performance of any of the agreements contained
in, or conditions of, this Agreement or the Shared Collateral Security
Documents.
5.4. Indemnity, Expenses. (a) Each of the Credit Agent and the Note
Agent agrees to indemnify and hold harmless the Shared Collateral Agent and its
officers, directors, agents and employees (each an "Indemnitee") ratably
according to the Pro Rata Share(s) held by the Lenders and the Senior
Noteholders, respectively, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses, claims or disbursements ("Claims") of any kind or nature whatsoever
that may be imposed on, incurred by, or asserted against the Indemnitee in any
way relating directly or indirectly to or arising directly or indirectly
(whether before or after termination of this Agreement) out of (i) this
Agreement or any of the Shared Collateral Security Documents (including without
limitation the negotiation, execution, and enforcement thereof), or any
transaction contemplated thereby, (ii) any action taken or omitted by the
Indemnitee pursuant to this Agreement or any of the Shared Collateral Security
Documents or (iii) any breach of any agreement or instrument as a result of any
action on taken or omitted by the Indemnitee hereunder or under any of the
Shared Collateral Security Documents, provided, however, that neither the Credit
Agent nor the Note Agent shall be liable for any portion of such Claims found to
result from the Indemnitee's gross negligence, willful misconduct or knowing
violations of law (as may be determined by New York law), unless such breach has
been waived by the Required Parties or the Required Parties shall have
instructed the Shared Collateral Agent to take an action which violates
applicable law. The Pro Rata Shares of the Lenders and the Senior Noteholders
for purposes of this Section 5.4(a) shall be determined (i)
26
in the case the Shared Collateral Agent has taken any Remedial Action with
respect to the Shared Collateral, at the time of the commencement of such
Remedial Action and (ii) in the case the Shared Collateral Agent has not taken
any such Remedial Action, as of the date such Claim commenced to be incurred, in
each case, as determined by the Shared Collateral Agent in good faith.
(b) Without limiting the generality of the foregoing, and to
the extent that the Indemnitee is not promptly reimbursed for such expenses by
the Borrower, the Credit Agent and the Note Agent severally agree to reimburse
the Indemnitee promptly upon demand ratably according to the Pro Rata Shares
held by the Lenders and the Senior Noteholders, respectively, for any
out-of-pocket expenses (including regular time billing charges of in-house or
outside counsel) incurred by the Indemnitee and permitted by this Section 5.4 in
connection with the administration or enforcement of, or legal advice in respect
of rights or responsibilities hereunder or under any of the Shared Collateral
Security Documents (including without limitation the enforcement of this
indemnity). The Pro Rata Shares of the Lenders and the Senior Noteholders for
purposes of this Section 5.4(b) shall be determined (i) in the case the Shared
Collateral Agent has taken any Remedial Action with respect to the Shared
Collateral, at the time of the commencement of such Remedial Action and (ii) in
the case the Shared Collateral Agent has not taken any such Remedial Action, as
of the date such Claim commenced to be incurred, in each case, as determined by
the Shared Collateral Agent in good faith.
(c) Any Indemnitee may retain its own counsel to prosecute,
negotiate or defend any Claims; provided, however, that the indemnification
obligations under this Section 5.4 shall only apply to one counsel with respect
to any Claim regardless of the number of Indemnitees. Any Indemnitee shall have
the right to compromise any Claims with the consent of the Required Parties.
(d) The obligations of the Credit Agent and the Note Agent,
collectively, under this Section 5.4 shall survive the payment of all Bank
Credit Agreement Obligations and the Senior Note Obligations and the termination
of this Agreement.
(e) The obligations of the Note Agent under this Section 5.4
shall in no event exceed the amounts actually paid to and received by the Note
Agent from the Borrower to reimburse the Note Agent for such obligations plus
the proceeds of the Shared Collateral received by the Note Agent and available
to pay such obligations in accordance with the terms of the Senior Note
Documents. The obligations of the Credit Agent under this Section 5.4 shall in
no event exceed amounts actually paid to and received by the Credit Agent from
the Borrower to reimburse the Credit Agent for such obligations plus the
proceeds of Shared Collateral received by the Credit Agent and available to pay
such obligations in accordance with the terms of the Bank Credit Agreement and
the Bank Credit Agreement Security Documents.
5.5. Resignation and Removal of Shared Collateral Agent. (a) (i) The
Shared Collateral Agent may resign at any time by giving sixty (60) days prior
written notice thereof to the Note Agent, the Credit Agent and the Borrower and
may be removed at any time, with or without cause, by the Required Parties by
written notice delivered to the Borrower, the Note Agent and the Credit Agent.
27
(ii) Upon receiving notice of any such resignation or
removal, a successor Shared Collateral Agent shall be appointed by the Note
Agent and the Credit Agent; provided, however, that such successor Shared
Collateral Agent shall be (A) a bank or trust company having a combined capital
and surplus of at least $100,000,000 subject to supervision or examination by a
federal or state banking authority, and (B) authorized under the laws of the
jurisdiction of its incorporation or organization to assume the functions of the
Shared Collateral Agent, If the appointment of such successor shall not have
become effective (as hereafter provided) within such sixty (60) day period after
the Shared Collateral Agent shall have given such notice, then the Shared
Collateral Agent may assign its Liens on the Shared Collateral and its duties
hereunder and under the Shared Collateral Security Documents to the Note Agent
and the Credit Agent, as their interests may appear, and in such case all
references herein to "Shared Collateral Agent" shall be deemed to refer to
"Required Parties". The Required Parties may petition a court of competent
jurisdiction for the appointment of a successor Shared Collateral Agent. Such
court shall, after such notice as it may deem proper, appoint a successor Shared
Collateral Agent meeting the qualifications specified in this Section 5.5(a).
The Note Agent, the Credit Agent, the Lenders and the Senior Noteholders hereby
consent to such petition and appointment so long as such criteria are met.
(iii) The resignation or removal of a Shared
Collateral Agent shall become effective upon the execution and delivery of such
documents or instruments as are necessary to transfer the rights and obligations
of the Shared Collateral Agent under the Shared Collateral Security Documents.
Copies for each such document or instrument shall be delivered to the Note Agent
and the Credit Agent. The appointment of a successor Shared Collateral Agent
pursuant to this Section 5.5(a) shall become effective upon the acceptance of
such appointment and such successor Shared Collateral Agent shall succeed to and
become vested with all the rights, powers, privileges and duties of the retiring
Shared Collateral Agent.
(b) After any resignation or removal hereunder of the Shared
Collateral Agent, the provisions of this Section 5 shall continue to inure to
its benefit as to any actions taken or omitted to be taken by it in connection
with its agency hereunder while it was the Shared Collateral Agent.
5.6. Shares of Collateral. Where the Shared Collateral Agent is
required or permitted hereunder, under any of the Shared Collateral Security
Documents or otherwise to do or refrain from doing any act in accordance with
the consent or instructions of the Note Agent, the Credit Agent, the Lenders,
the Senior Noteholders or any group thereof, and where the Shared Collateral
Agent is required or permitted to make any payment, disbursement or distribution
to any such Person (or to require any payment from any such Person), then in
calculating the Bank Credit Agreement Obligations or Senior Note Obligations
held by any such Person or the amount of any payments to be made to any such
Person (anything to the contrary herein or elsewhere notwithstanding) the Shared
Collateral Agent may assume in the absence of a written representation to the
contrary that (i) all scheduled payments of principal and interest have been
made as required by the Senior Note Documents and the Bank Credit Agreement, and
(ii) no prepayments on the Bank Credit Agreement Obligations or Senior Note
Obligations have been received since the last date the Credit Agent reported the
outstanding principal amount of the Bank Credit Agreement Obligations to the
Shared Collateral Agent except those received by the Shared Collateral Agent in
accordance with this Agreement and disbursed to the Note Agent
28
and the Credit Agent in accordance with the provisions hereof. In the event of
any controversy with respect to any payment or prepayment made, the Shared
Collateral Agent shall be permitted to rely conclusively (in the absence of
manifest error) upon its own records with respect to any payments made to or by
the Shared Collateral Agent and, in every other case, upon the written
representation of any of the Note Agent, the Credit Agent, a Lender or a Senior
Noteholder as to facts regarding the Bank Credit Agreement Obligations or the
Senior Note Obligations owed to it, notwithstanding any contrary representation
by any other party. The Shared Collateral Agent shall be entitled to retain
funds or make a partial distribution of funds to any such Person pending any
investigation or resolution of any such controversy.
5.7. Compensation and Expenses. The Shared Collateral Agent shall be
entitled to charge such reasonable fees (in addition to its expenses) for
services as the Shared Collateral Agent as may be agreed from time to time
between the Shared Collateral Agent and the Borrower. The Shared Collateral
Agent may incur such reasonable expenses (including, without limitation,
attorneys' fees and regular time billing charges of in-house or outside counsel)
directly or indirectly in connection with the discharge or exercise of any of
its rights, powers or obligations hereunder and under the Shared Collateral
Security Documents as it in its sole and absolute discretion may deem necessary
or appropriate. Said fees and expenses shall be charged to the Borrower by the
Shared Collateral Agent and shall be included in the amounts secured by the
Shared Collateral Security Documents.
5.8. Authorized Investments. Any and all funds held by the Shared
Collateral Agent in its capacity as Shared Collateral Agent, whether pursuant to
any provision of any of the Shared Collateral Security Documents or otherwise,
shall to the extent feasible within a reasonable time be invested by the Shared
Collateral Agent in Cash Equivalent Investments. Any interest earned on such
funds shall be deposited into the Shared Collateral Account and disbursed to the
Note Agent and the Credit Agent in accordance with this Agreement. The Shared
Collateral Agent may hold any such funds in a common interest bearing account.
The Shared Collateral Agent shall have no duty to place funds held pursuant to
this Section 5.8 in investments which provide a maximum return; provided,
however, that the Shared Collateral Agent shall to the extent feasible invest
funds in Cash Equivalent Investments with reasonable promptness, The Shared
Collateral Agent shall not be responsible for any loss of any funds invested in
accordance with this Section 5.8.
5.9. Shared Collateral Agent Counsel, Joint Defense Privilege. The Note
Agent and the Credit Agent acknowledge that the Shared Collateral Agent may hire
counsel to advise it with respect to its rights and duties hereunder, and that
such counsel does not and will not represent the interests of the Note Agent,
the Credit Agent, any Lender or any Senior Noteholder, individually. The Note
Agent and the Credit Agent acknowledge that conflicts may arise among such
Persons and waive any conflicts of interest which arise or exist for such
counsel as a result of counsel's representation of the Shared Collateral Agent.
The Note Agent and the Credit Agent further agree to be bound by the joint
defense privilege with respect to all matters relating to this Agreement, the
Shared Collateral Security Documents and the Shared Collateral. All
communications from the Shared Collateral Agent's counsel to the Credit Agent,
the Note Agent, or the Shared Collateral Agent, any Lender or any Senior
Noteholder are subject to such privilege and each Person agrees not to waive
such privilege, or to disclose any such communications, without the consent of
all such Persons.
29
6. Term. This Agreement shall be irrevocable and shall remain in full
force and effect until (i) all of the letters of credit issued pursuant to the
Bank Credit Agreement have been terminated and the loans, notes and unpaid
letter of credit drawings, together with interest, fees and all other Bank
Credit Agreement Obligations incurred thereunder are paid in fill, all
obligations to extend further advances pursuant to the Bank Credit Agreement
have been terminated and all Hedging Obligations have been paid in full and the
related agreements terminated, or (ii) the payment in full of all of the Senior
Notes and all other Senior Note Obligations then due and owing, at which time,
subject to Section 3.6 hereof, this Agreement shall automatically terminate;
provided, however, that (x) the obligations of the Credit Agent and the Lenders
under Section 3.11 (b) shall survive for a period of sixty (60) days following
the termination of this Agreement and, if any claim thereunder is asserted prior
to the expiration of such sixty (60) day period, shall survive thereafter,
solely as to such claim, until such claim has been fully resolved or until the
expiration of such statute of limitations applicable thereto; and (y) as set
forth in Section 3.1 l(d) and 3.12(a), the rights of the Credit Agent pursuant
to Sections 3.11 and 3.12 shall continue to apply in accordance with the terms
thereof notwithstanding any sale of the Senior Note Collateral. At the time of
such termination, (a) if such termination occurs pursuant to clause (i) of the
preceding sentence, the Credit Agent shall (x) deliver to the Note Agent any
Collateral then in its possession unless the Note Agent advises the Credit Agent
that possession of such Collateral by the Note Agent is not required pursuant to
the Senior Note Security Documents and (y) terminate or assign to the Note Agent
any landlords' agreements, warehouse operators' agreements and similar
agreements in favor of the Credit Agent pertaining to the Collateral; and (b) if
such termination occurs pursuant to clause (ii) of the preceding sentence, the
Note Agent shall (x) deliver to the Credit Agent any Collateral then in its
possession unless the Credit Agent advises the Note Agent that possession of
such Collateral by the Credit Agent is not required pursuant to the Bank Credit
Agreement Security Documents and (y) terminate or assign to the Credit Agent any
landlords' agreements, warehouse operators' agreements and similar agreements in
favor of the Note Agent pertaining to the Collateral; and (c) if such
termination occurs pursuant to clauses (i) and (ii) concurrently, then each of
the Credit Agent and the Note Agent shall (x) deliver to the Borrower any
Collateral then in its possession and (y) terminate any landlords' agreements,
warehouse operators' agreements and similar agreements in its favor pertaining
to the Collateral.
7. Representations and Warranties. Each of the Credit Agent, the Note
Agent and the Shared Collateral Agent represents and warrants to the other that:
(a) It is a duly organized and validly existing corporation
under the laws of the State of Illinois, in the case of the Credit Agent, and is
a duly organized and validly existing banking corporation under the laws of the
State of New York, in the case of the Note Agent and the Shared Collateral
Agent; has all requisite power and authority to execute, deliver, and perform
under this Agreement; and the execution, delivery, and performance by it of this
Agreement have been duly authorized by all requisite corporate or other action;
and
(b) Pursuant to the terms of the Collateral Agency Agreement
and the Bank Credit Agreement, the Credit Agent has been granted all requisite
authority to bind the Lenders and pursuant to the terms of the Senior Note
Documents, the Note Agent has been granted all requisite authority to bind the
Senior Noteholders by their respective execution and delivery of this Agreement,
and pursuant to the terms of the Collateral Agency Agreement, and
30
the Bank Credit Agreement and the Senior Note Documents, no further consent or
approval on the part of the Lenders or the Senior Noteholders, as the case may
be, is or will be required in connection with the execution, delivery and
performance of this Agreement.
8. Miscellaneous.
8.1. Notices. Whenever it is provided herein that any notice, demand,
request, consent, approval, declaration or other communication shall or may be
given to or served upon either of the parties by the other, or whenever either
of the parties desires to give or serve upon the other any such communication
with respect to this Agreement, each such notice, demand, request, consent,
approval, declaration or other communication shall be in writing and either
shall be delivered in person with receipt acknowledged, delivered by reputable
overnight courier or telecopied and confirmed immediately in writing by a copy
mailed by registered or certified mail, return receipt requested, postage
prepaid, or mailed by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:
If to the Credit Agent at:
Congress Financial Corporation (Central)
000 Xxxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Portfolio Manager
If to the Note Agent at:
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
If to the Shared Collateral Agent at:
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in writing
by the party entitled to receive such notice. Every notice, demand, request,
consent, approval, declaration or other communication hereunder shall be deemed
to have been duly given or served on the date on which personally delivered,
with receipt acknowledged, on the date of delivery by reputable overnight
courier service, on the date of telecopier transmission or three (3) Business
Days after the same shall have been deposited with the United States mail.
Failure or delay in delivering copies of any notice, demand, request, consent,
approval, declaration or other communication to the persons designated above to
receive copies shall in no way adversely affect the effectiveness of such
notice, demand, request, consent, approval, declaration or other communication.
31
8.2. Entire Agreement; Amendment. This Agreement constitutes the entire
agreement between the Credit Agent, the Note Agent and the Shared Collateral
Agent with respect to the subject matter hereof and supersedes all prior
negotiations, understandings and agreements between the Credit Agent, the Note
Agent and the Shared Collateral Agent in respect of such subject matter, whether
written or oral. This Agreement may be amended, modified or supplemented only by
a written instrument executed by the Credit Agent, the Note Agent and the Shared
Collateral Agent.
8.3. WAIVER OF JURY TRIAL: CONSENT TO JURISDICTION.
(a) EACH OF THE PARTIES HERETO WAIVE, TO THE FULLEST EXTENT
PERMITTED BY LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO
ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT.
(b) EACH OF THE PARTIES HERETO SUBMITS FOR ITSELF AND ITS
PROPERTY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR FOR
RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF, TO THE
NON-EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND
THE COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW
YORK AND APPELLATE COURTS FROM ANY THEREOF.
8.4. Severability. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
8.5. Survival. The representations and warranties of the parties in
this Agreement shall survive the execution, delivery and acceptance hereof by
the parties hereto until the termination of this Agreement pursuant to Section 6
hereof.
8.6. Counterparts. This Agreement may be executed in any number of
counterparts, all of which, taken together, shall constitute one and the same
instrument, and either of the parties hereto may execute this Agreement by
signing any such counterpart.
8.7. GOVERNING LAW. THIS AGREEMENT SHALL BE INTERPRETED, AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HERETO DETERMINED, IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE.
8.8. Parties. This Agreement shall be binding upon, and shall inure to
the benefit of, the parties hereto, the Lenders from time to time party to the
Bank Credit Agreement, the Senior Noteholders from time to time under the Senior
Note Documents and their respective successors and assigns; provided, however,
that any successor Credit Agent, Note Agent or Shared Collateral Agent shall
expressly assume the obligations of such party hereunder.
32
8.9 No Third Party Beneficiaries. Nothing contained in this Agreement
shall be deemed to indicate that this Agreement has been entered into for the
benefit of the Borrower or any other Person except for the parties hereto, the
Lenders, the Senior Noteholders and their respective successors and assigns.
8.10. Trust Indenture Act. To the extent applicable, if any provision
of this Agreement limits, qualifies or conflicts with the duties imposed on the
Note Agent or the Shared Collateral Agent by the TIA, the TIA shall control. Any
action required to be taken in order to comply with the TIA shall be taken by
the Note Agent and the Shared Collateral Agent.
8.11. Legend. Each of the Bank Credit Agreement, the Bank Credit
Agreement Security Documents, the Senior Note Documents, the Senior Notes and
the Senior Note Security Documents shall be made specifically subject to the
terms and conditions of this Agreement.
8.12. Section Titles. The Section titles contained in this Agreement
are and shall be without substantive meaning or content of any kind whatsoever
and are not a part of the agreement between the parties hereto.
[SIGNATURE PAGE FOLLOWS]
33
IN WITNESS WHEREOF, this Agreement has been signed and sealed by the
undersigned duly authorized signatories of the parties hereto as of the date and
year first above written.
CONGRESS FINANCIAL CORPORATION (CENTRAL),
as Credit Agent
BY /s/ Xxxxxxx X. Xxxx, Xx.
---------------------------------
Name: Xxxxxxx X. Xxxx, Xx.
Title: Vice President
THE BANK OF NEW YORK,
as Note Agent
BY /s/ Xxxxx Xxxxxx
---------------------------------
Name: XXXXX XXXXXX
Title: VICE PRESIDENT
THE BANK OF NEW YORK,
as Shared Collateral Agent
BY /s/ Xxxxx Xxxxxx
---------------------------------
Name: XXXXX XXXXXX
Title: Vice President
34
Anchor Glass Container Corporation, a Delaware corporation, (a)
acknowledges receipt of a copy of this Agreement and agrees to the provisions
hereof; (b) agrees to cooperate with the parties hereto by granting all Liens,
and by taking all such other actions, as are contemplated by Section 3.8(b)
hereof; (c) acknowledges that, as provided by Section 8.9 hereof, it is not a
third party beneficiary hereof, and has no rights hereunder; (d) acknowledges
and consents to the priority of the liens purported to be established by this
Agreement, as in effect on the effective date of this Agreement; (e) agrees not
to object to the enforcement by the Credit Agent against the Note Agent or the
Note Agent against the Credit Agent of any of the respective rights granted to
them pursuant to Section 3.11(a) hereof, as in effect on the effective date of
this Agreement; (f) agrees to the provision in Section 3.12(a), as in effect on
the effective date of this Agreement, pursuant to which the Borrower agrees to
certain sales of Collateral and the commercial reasonableness thereof; and (g)
agrees not to assert any provision hereof as a defense to any Remedial Action
(except to the extent that the provisions of this Agreement are expressly
referred to in or incorporated in the Bank Credit Agreement, the Senior Note
Documents or any Security Document as a limitation on its obligations thereunder
or on the Credit Agent's, Lenders', the Note Agent's or the Senior Noteholders'
rights thereunder) nor to assert any such provision as a counterclaim or basis
for set-off or recoupment against any party hereto. Such acknowledgments and
agreements by Anchor Glass Container Corporation do not, however, constitute any
amendment, modification, or waiver by it of any provision of the Bank Credit
Loan Agreement, the Senior Note Documents or any Security Document or any right
available to it thereunder.
ANCHOR GLASS CONTAINER
CORPORATION
By: /s/ Xxxxxxx Xxxxxx
---------------------------
Name: Xxxxxxx Xxxxxx
Title: President
EXHIBIT A
BANK COLLATERAL
All of the following Anchor Property (in the case of items (c), (d) and
(f)-(i) below, to the extent necessary to realize on the Bank Collateral
(including, but not limited to, the sale or marketing of the Bank Collateral)),
whether now existing or hereafter acquired, arising or created and wheresoever
located unless specifically excluded pursuant to the relevant Bank Credit
Agreement Security Documents:
(a) each and every Receivable;
(b) all Inventory;
(c) each Cash Collateral Account and all monies, securities
and instruments deposited or required to be deposited in such Cash
Collateral Account;
(d) all of the Collection Accounts and Sub-Collection
Accounts, all moneys, securities and instruments deposited or required
to be deposited in such Collection Accounts and Sub-Collection
Accounts;
(e) each Concentration Account and all moneys, securities and
instruments deposited or required to be deposited in such Concentration
Account;
(f) the Disbursement Account and all moneys deposited or
required to be deposited in such Disbursement Account;
(g) each Collection Bank Agreement to which the Borrower is
a party and each other agreement entered into by the Borrower with any
depositary institution and all rights of the Borrower under each such
agreement;
(h) the Concentration Account Agreement and each other
agreement entered into by such Borrower with any Concentration Account
Bank and all rights of the Borrower under each such agreement; and
(i) all Proceeds and products of any and all of the foregoing.
A-1
EXHIBIT B
SENIOR NOTE COLLATERAL
All of the assets, whether now existing or hereafter from time to time
acquired, by the Borrower or any of its present or future Subsidiaries,
including, without limitation:
(a) any and all real property and leasehold interest in real
property now or hereafter owned by the Borrower or its Subsidiaries and
Improvements (as defined in the Senior Note Indenture);
(b) all Equipment;
(c) any Collateral Account and all moneys, securities and
instruments deposited or required to be deposited in such Collateral
Account;
(d) all of the Capital Stock (as defined in the Senior Note
Indenture) of any Restricted Subsidiary (as defined in the Senior Note
Indenture);
(e) non-cash consideration received as consideration for an
Asset Sale (as defined in the Senior Note Indenture); and
(f) all Proceeds and products of any and all of the foregoing
(including without limitation, Insurance Proceeds (as defined in the
Senior Note Indenture));
provided, that, none of the "Senior Note Collateral" shall include any
of the Bank Collateral or the Shared Collateral.
B-1
EXHIBIT C
SHARED COLLATERAL
All of the following Anchor Property, whether now existing or hereafter
acquired, arising or created and wheresoever located:
(a) all Contracts, together with all Contract Rights arising
thereunder;
(b) all Trademarks, together with the registrations and right
to all renewals thereof, and the goodwill of the business of the
Borrower symbolized by such trademarks;
(c) all Patents (limited to any U.S. patent to which the
Borrower now or hereafter has title, as well as any application for a
U.S. patent now or hereafter made by the Borrower) and Copyrights and
all reissues, renewals or extensions thereof;
(d) all computer programs of the Borrower and all intellectual
property rights therein and all other proprietary information of the
Borrower, including, but not limited to, Trade Secret Rights:
(e) all insurance policies,
(f) all other Goods, General Intangibles, Chattel Paper,
Documents and Instruments (excluding Capital Stock); and
(g) all Proceeds and products of any and all of the foregoing.
I-1
