Exhibit 10.3
EXECUTION COPY
AMENDED AND RESTATED
COLLATERAL TRUST AGREEMENT
dated as of June 6, 2006
among
POLYONE CORPORATION,
as Grantor,
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Collateral Trustee
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms........................................ 3
SECTION 1.02. Certain References........................................... 6
ARTICLE II
CONFIRMATION AND CREATION OF SECURITY INTERESTS
SECTION 2.01. Collateral Trust Estate...................................... 7
SECTION 2.02. Security for Secured Obligations............................. 7
ARTICLE III
COLLATERAL ACCOUNT
SECTION 3.01. Collateral Account........................................... 8
ARTICLE IV
ACTIONABLE DEFAULTS; REMEDIES
SECTION 4.01. Actionable Default Notice.................................... 8
SECTION 4.02. Direction by Required Representatives........................ 9
SECTION 4.03. Right to Initiate Judicial Proceedings, Etc.................. 9
SECTION 4.04. Remedies Not Exclusive....................................... 10
SECTION 4.05. Waiver of Certain Rights..................................... 10
SECTION 4.06. Limitation on Collateral Trustee's Duties in Respect of
Collateral................................................... 11
SECTION 4.07. Limitation by Law............................................ 11
SECTION 4.08. Absolute Rights of Secured Holders and Representatives....... 11
SECTION 4.09. Equal and Ratable Security................................... 11
ARTICLE V
APPLICATION OF PROCEEDS
SECTION 5.01. Application of Proceeds...................................... 12
SECTION 5.02. Application of Withheld Amounts.............................. 13
SECTION 5.03. Release of Amounts in Collateral Account..................... 13
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ARTICLE VI
AGREEMENTS WITH THE COLLATERAL TRUSTEE
SECTION 6.01. Delivery of Agreements....................................... 14
SECTION 6.02. Information as to Representatives............................ 14
SECTION 6.03. Compensation and Expenses.................................... 14
SECTION 6.04. Stamp and Other Similar Taxes................................ 15
SECTION 6.05. Filing Fees, Excise Taxes, Etc............................... 15
SECTION 6.06. Indemnification.............................................. 15
SECTION 6.07. Further Assurances........................................... 16
ARTICLE VII
THE COLLATERAL TRUSTEE
SECTION 7.01. Declaration of Trust......................................... 16
SECTION 7.02. Exculpatory Provisions....................................... 16
SECTION 7.03. Delegation of Duties......................................... 17
SECTION 7.04. Reliance by Collateral Trustee............................... 17
SECTION 7.05. Limitations on Duties of the Trustees........................ 18
SECTION 7.06. Moneys to Be Held in Trust................................... 19
SECTION 7.07. Resignation and Removal of Collateral Trustee................ 19
SECTION 7.08. Status of Successors to Trustee.............................. 20
SECTION 7.09. Merger of the Collateral Trustee............................. 20
SECTION 7.10. Additional Co-Trustees; Separate Trustees.................... 20
SECTION 7.11. Trustees Appointed Attorneys-in-Fact......................... 21
SECTION 7.12. Ordinary Care................................................ 22
ARTICLE VIII
RELEASE OF COLLATERAL
SECTION 8.01. Partial Release of Collateral................................ 22
SECTION 8.02. Full Release of Collateral Upon Satisfaction of Certain
Conditions................................................... 23
SECTION 8.03. Effect of Release of Collateral.............................. 24
ARTICLE IX
MISCELLANEOUS
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SECTION 9.01. Amendments, Supplements and Waivers.......................... 24
SECTION 9.02. Additional Actions of Representatives........................ 25
SECTION 9.03. Notices...................................................... 25
SECTION 9.04. Headings..................................................... 26
SECTION 9.05. Severability................................................. 26
SECTION 9.06. Treatment of Payee or Indorsee by Trustee.................... 26
SECTION 9.07. Dealings with the Grantor.................................... 26
SECTION 9.08. Claims....................................................... 26
SECTION 9.09. Binding Effect............................................... 26
SECTION 9.10. Governing Law................................................ 27
SECTION 9.11. Effectiveness................................................ 27
SECTION 9.12. Reexecution of Agreement..................................... 27
SECTION 9.13. Effect on Guarantee and Agreement............................ 27
SECTION 9.14. Counterparts................................................. 27
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AMENDED AND RESTATED COLLATERAL TRUST AGREEMENT
AMENDED AND RESTATED COLLATERAL TRUST AGREEMENT, dated as of June 6,
2006 (as amended, amended and restated, supplemented or otherwise modified from
time to time, this "Agreement"), between POLYONE CORPORATION, an Ohio
corporation (the "Grantor"), and U.S. BANK TRUST NATIONAL ASSOCIATION ("U.S.
Bank"), a national banking association (together with any successor collateral
trustee appointed pursuant to Article VII hereof, the "Collateral Trustee"), as
trustee for the Secured Holders (as hereinafter defined).
PRELIMINARY STATEMENTS:
(1) The Geon Company, a Delaware corporation and predecessor in
interest to the Grantor ("Geon"), has made a guarantee dated as of December 22,
1997 (as amended, supplemented or otherwise modified and in effect on the date
hereof and as the same may hereafter be further amended, modified, extended,
renewed, replaced, restated or supplemented from time to time pursuant to the
terms thereof, the "Sunbelt Guarantee") in favor of each of the holders of the
Guaranteed Secured Senior Notes due 2017, Series G (as amended, supplemented or
otherwise modified and in effect on the date hereof and as the same may
hereafter be further amended, modified, extended, renewed, replaced, restated or
supplemented from time to time pursuant to the terms thereof, the "Sunbelt
Notes") issued by Sunbelt Cholor Alkali Partnership pursuant to the Note
Purchase Agreements, each dated December 22, 1997 between Sunbelt and the
purchasers of the Sunbelt Notes.
(2) The Grantor has issued (i) 7 1/2% Debentures due 2015 (as amended,
supplemented or otherwise modified and in effect on the date hereof and as the
same may hereafter be further amended, modified, extended, renewed, replaced,
restated or supplemented from time to time pursuant to the terms thereof, the
"Geon Debentures") pursuant to that certain Indenture dated as of December 1,
1995 (as amended, supplemented or otherwise modified and in effect on the date
hereof and as the same may be further amended, modified, extended, renewed,
replaced, restated or supplemented from time to time pursuant to the terms
thereof, the "Geon Indenture"), (ii) 8 7/8% Senior Notes due 2012 (as amended,
supplemented or otherwise modified and in effect on the date hereof and as the
same may hereafter be further amended, modified, extended, renewed, replaced,
restated or supplemented from time to time pursuant to the terms thereof, the
"2002 PolyOne Notes") pursuant to that certain Indenture dated as of April 23,
2002 (as amended, supplemented or otherwise modified and in effect on the date
hereof and as the same may be further amended, modified, extended, renewed,
replaced, restated or supplemented from time to time pursuant to the terms
thereof, the "2002 PolyOne Indenture") and (iii) 10 5/8% Senior Notes due 2010
(as amended, supplemented or otherwise modified and in effect on the date hereof
and as the same may hereafter be further amended, modified, extended, renewed,
replaced, restated or supplemented from time to time pursuant to the terms
thereof, the "2003 PolyOne Notes") pursuant to that certain Indenture dated as
of May 6, 2003 (as amended, supplemented or otherwise modified and in effect on
the date hereof and as the same may be further amended, modified, extended,
renewed, replaced, restated or supplemented from time to time pursuant to the
terms thereof, the "2003 PolyOne Indenture").
(3) The Sunbelt Guarantee, the Sunbelt Notes, the Geon Indenture, the
Geon Debentures, the 2002 PolyOne Indenture, the 2002 PolyOne Notes, the 2003
PolyOne Indenture and the 2003 PolyOne Notes, and each agreement and instrument
delivered by the Grantor pursuant to any of the foregoing, as the same may be
supplemented, amended or modified from time to time in accordance with the
provisions thereof, are collectively referred to herein as the "Existing
Indebtedness Agreements". Pursuant to the Sunbelt Guarantee, the Geon Indenture,
the 2002 PolyOne Indenture and the 2003 PolyOne Indenture, the Grantor has
agreed not to incur, and not to permit certain of its Subsidiaries to incur,
certain Liens (as therein defined) upon certain of its property or assets to
secure certain
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indebtedness without making effective provision whereby the obligations under
the Existing Indebtedness Agreements shall be secured equally and ratably with
the indebtedness secured by such Liens.
(4) The Grantor has entered into that certain Collateral Trust
Agreement, dated as of January 25, 2002 (as amended to, but not including the
date hereof, the "Existing Collateral Trust Agreement"), with the Collateral
Trustee or its predecessor, as corporate trustee, and Xxxxxxxx Xxxx, an
individual residing in the State of New Jersey, or her predecessor, in each case
not in an individual capacity but as individual trustee.
(5) Concurrently with the execution of this Agreement, the Grantor is
entering into a Guarantee and Agreement, dated as of June 6, 2006 (as amended,
amended and restated, supplemented or otherwise modified from time to time, the
"Guarantee and Agreement"), with each of the financial institutions party
thereto, as beneficiary (collectively, the "Beneficiaries"), and Citicorp USA,
Inc., as administrative agent for the Beneficiaries thereunder (together with
any successor administrative agent appointed pursuant to Article VII of the
Guarantee and Agreement, the "Beneficiary Agent").
(6) Concurrently with the execution of this Agreement, the Grantor is
entering into a second amendment and restatement of that certain Amended and
Restated Security Agreement, dated as of May 6, 2003, from the Grantor to the
Collateral Trustee or its predecessor, as corporate trustee, and Xxxxxxxx Xxxx,
an individual residing in the State of New Jersey, or her predecessor, in each
case not in an individual capacity but as individual trustee (as amended,
amended and restated, supplemented or otherwise modified from time to time, the
"Security Agreement").
(7) Concurrently with the execution of this Agreement, the Grantor is
entering into a an amendment and restatement of that certain Intercreditor
Agreement, dated as of May 6, 2003, among the Grantor, the Collateral Trustee or
its predecessor, as corporate trustee, and Xxxxxxxx Xxxx, an individual residing
in the State of New Jersey, or her predecessor, in each case not in an
individual capacity but as individual trustee, and the other parties thereto (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the "Intercreditor Agreement"), pursuant to which the parties thereto
shall have agreed to certain matters with respect to, inter alia, the grant of
security interests under the Security Agreement.
(8) This Agreement, the Security Agreement, each Successor Collateral
Agreement (as hereinafter defined) and each other agreement entered into by the
Collateral Trustee at the direction of the Required Representatives, including,
without limitation, the Intercreditor Agreement, are collectively referred to
herein as the "Shared Collateral Documents". The Shared Collateral Documents are
intended to secure the Existing Indebtedness Agreements, to the extent required
to comply with the provisions of the Existing Indebtedness Agreements, and the
Guarantee and Agreement and it is a condition to the occurrence of the Effective
Date under the Guarantee and Agreement that the Grantor shall have granted to
the Collateral Trustee the pledge and assignment of, and the lien and security
interest in, certain property and assets of the Grantor pursuant to the Shared
Collateral Documents.
(9) Terms defined in the Guarantee and Agreement or the Security
Agreement and not otherwise defined in this Agreement are used in this Agreement
as defined in the Guarantee and Agreement or the Security Agreement,
respectively.
NOW, THEREFORE, in consideration of the premises and in order to
induce the Beneficiaries to enter into the Guarantee and Agreement, the Grantor
hereby agrees with the Collateral Trustee for its benefit and in trust for the
equal and ratable benefit of the Representatives and the Secured Holders to
amend and restate the Existing Collateral Trust Agreement, effective as of the
date hereof, as follows:
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ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. The following terms shall have
the following meanings as used herein (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
"Actionable Default" has the meaning specified in Section 4.01.
"Actionable Default Notice" has the meaning specified in Section 4.01.
"Additional Collateral" has the meaning specified in Section 2.01.
"Agreement" has the meaning specified in the recital of parties to
this Agreement.
"Bankruptcy Code" means Title 11 of the United States Code entitled
"Bankruptcy", as amended from time to time.
"Beneficiaries" has the meaning specified in the Preliminary
Statements to this Agreement.
"Beneficiary Agent" has the meaning specified in the Preliminary
Statements to this Agreement.
"Business Day" means a day of the year on which banks are not required
or authorized by law to close in New York City or the city in which the
Collateral Trustee maintains its corporate trust office.
"Cash Equivalents" means any of the following, to the extent free and
clear of all Liens other than Liens created under the Collateral Documents and
having a maturity of not greater than 180 days from the date of acquisition
thereof: (a) readily marketable direct obligations of the Government of the
United States or any agency or instrumentality thereof or obligations
unconditionally guaranteed by the full faith and credit of the Government of the
United States, (b) insured certificates of deposit of or time deposits with any
commercial bank that (i) is a Beneficiary or a member of the Federal Reserve
System, (ii) issues (or the parent of which issues) commercial paper rated as
described in clause (c) below, (iii) is organized under the laws of the United
States or any State thereof and (iv) has combined capital and surplus of at
least $1 billion, (c) commercial paper in an aggregate amount of no more than
$1,000,000 per issuer outstanding at any time, issued by any corporation
organized under the laws of any State of the United States and rated at least
"Prime-1" (or the then equivalent grade) by Xxxxx'x or "A-1" (or the then
equivalent grade) by S&P or (d) money market or mutual funds that invest solely
in Cash Equivalents of the types described in clauses (a), (b) or (c) above.
"Collateral" means, collectively, all of the "Collateral" as defined
in Section 1 of the Security Agreement and all of the Additional Collateral.
"Collateral Account" has the meaning specified in Section 3.01.
"Collateral Trust Estate" means all of the right, title and interest
of the Collateral Trustee, whether now owned or hereafter acquired, in and to
the Collateral.
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"Collateral Trustee" has the meaning specified in the recital of
parties to this Agreement.
"Collateral Trustee's Fees" means the fees and other amounts payable
to the Collateral Trustee pursuant to Sections 6.03, 6.04 and 6.05 and amounts
claimed and unpaid pursuant to Section 6.06.
"Defaulted Agreement Party" has the meaning specified in Section 4.01.
"Distribution Date" means any date on which the Collateral Trustee
shall distribute moneys from the Collateral Account pursuant to Section 5.01.
"Existing Indebtedness Agreements" has the meaning specified in the
Preliminary Statements to this Agreement.
"Existing Collateral Trust Agreement" has the meaning specified in the
Preliminary Statements to this Agreement.
"Geon" has the meaning specified in the Preliminary Statements to this
Agreement.
"Geon Debentures" has the meaning specified in the Preliminary
Statements to this Agreement.
"Geon Debenture Holders" means at any time the registered holders of
the Geon Debentures issued under the Geon Indenture at such time.
"Geon Indenture" has the meaning specified in the Preliminary
Statements to this Agreement.
"Geon Indenture Trustee" means NBD Bank, as trustee under the Geon
Indenture, and any successor trustee appointed thereunder.
"Grantor" the meaning specified in the recital of parties to this
Agreement.
"Guarantee and Agreement" has the meaning specified in the Preliminary
Statements to this Agreement.
"Guaranteed Obligations" has the meaning specified in the Guarantee
and Agreement.
"Intercreditor Agreement" has the meaning specified in the Preliminary
Statements to this Agreement.
"Notice of Partial Release" has the meaning specified in Section 8.01.
"Representatives" means at any time, collectively, (a) the Beneficiary
Agent, as representative hereunder for the Beneficiaries at such time, (b) each
Sunbelt Note Holder at such time, (c) the Geon Indenture Trustee, as the
representative of the Geon Debenture Holders at such time, (d) the 2002 PolyOne
Notes Trustee, as the representative of the 2002 PolyOne Notes Holders at such
time and (e) the 2003 PolyOne Notes Trustee, as representative of the 2003
PolyOne Notes Holders at such time.
"Required Representatives" means, (a) at any time that no Actionable
Default Notice has been received by the Collateral Trustee (or if an Actionable
Default Notice has been received, it has been withdrawn), the Beneficiary Agent
acting in its own discretion or at the direction of the Required
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Beneficiary at such time, or (b) at any time that an Actionable Default Notice
has been received by the Collateral Trustee that has not been withdrawn, the
Representatives, on behalf of themselves and the Secured Holders represented
thereby, that own or hold (either by themselves or through their respective
Secured Holders) more than 50% of the aggregate amount of the outstanding
Secured Obligations at such time; provided, however, that amounts held at such
time by the Collateral Trustee on behalf of a Representative and such
Representative's Secured Holders in an account of the Collateral Trustee
established at the request of such Representative pursuant to Section 5.02 shall
be deemed to have been applied to repay the Secured Obligations of such Secured
Holders whether or not such amount has been so applied.
"Secured Agreements" means, collectively, the Transaction Documents
and the Existing Indebtedness Agreements, (including, without limitation, the
Shared Collateral Documents), as the same may be amended from time to time in
accordance with the provisions thereof.
"Secured Holders" means at any time, the Beneficiaries, the Sunbelt
Notes Holders, the Geon Debenture Holders, the 2002 PolyOne Notes Holders and
the 2003 PolyOne Notes Holders at such time.
"Secured Obligations" means at any time any obligations, whether
matured or unmatured, contingent or liquidated, of the Grantor arising out of or
evidenced this Agreement or by the Secured Agreements, whether for principal,
interest, expenses, premiums, indemnities, fees or other amounts, whether or not
such obligations are due and payable at such time. For purposes of determining
the "Required Representatives" on any date, the aggregate amount of outstanding
Secured Obligations represented by each Representative on such date shall
include:
(a) in the case of the Secured Obligations of Secured Holders
represented by the Beneficiary Agent under the Guarantee and Agreement, the
aggregate amount of the Guaranteed Obligations outstanding at such time,
(b) in the case of Secured Obligations of Secured Holders comprised of
the Sunbelt Notes Holders, the Guarantor Portion (as defined in the Sunbelt
Guarantee) of the Issuer Obligations (as defined in the Sunbelt Guarantee),
(c) in the case of Secured Obligations of Secured Holders consisting
of the Geon Debenture Holders under the Geon Indenture, the Geon Debentures
Outstanding (as defined in the Geon Indenture) at such time,
(d) in the case of the Secured Obligations of Secured Holders
consisting of the 2002 PolyOne Notes Holders under the 2002 PolyOne
Indenture, the 2002 PolyOne Notes Outstanding (as defined in the 2002
PolyOne Indenture) at such time, and
(e) in the case of the Secured Obligations of Secured Holders
consisting of the 2003 PolyOne Notes Holders under the 2003 PolyOne
Indenture, the 2003 PolyOne Notes Outstanding (as defined in the 2003
PolyOne Indenture) at such time.
"Secured Parties" means the Collateral Trustee, the Representatives
and the Secured Holders.
"Security Agreement" has the meaning specified in the Preliminary
Statements to this Agreement.
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"Shared Collateral Documents" has the meaning specified in the
Preliminary Statements to this Agreement.
"Successor Collateral" means, with respect to the Grantor, any
property and assets of the Grantor (or any of its successors and assigns) as the
Grantor (or any such successor or any such assign) may, from time to time, upon
notice to the Collateral Trustee, pursuant to the Secured Agreements or
otherwise, grant to the Collateral Trustee as additional collateral for their
benefit and in trust for the equal and ratable benefit of the Representatives,
on their behalf and on behalf of the Secured Holders.
"Successor Collateral Agreements" means all documents creating,
evidencing or relating to any of the Successor Collateral.
"Sunbelt Guarantee" has the meaning specified in the Preliminary
Statements to this Agreement.
"Sunbelt Notes" has the meaning specified in the Preliminary
Statements to this Agreement.
"Sunbelt Notes Holders" means at any time the registered holders of
the Sunbelt Notes at such time.
"Transaction Documents" has the meaning specified in the Guarantee and
Agreement.
"U.S. Bank" the meaning specified in the recital of parties to this
Agreement.
"2002 PolyOne Indenture" has the meaning specified in the Preliminary
Statements to this Agreement.
"2002 PolyOne Indenture Trustee" means The Bank of New York, as
trustee under the 2002 PolyOne Indenture, and any successor trustee appointed
thereunder.
"2002 PolyOne Notes" has the meaning specified in the Preliminary
Statements to this Agreement.
"2002 PolyOne Notes Holders" means at any time the registered holders
of the 2002 PolyOne Notes issued under the 2002 PolyOne Indenture at such time.
"2003 PolyOne Indenture" has the meaning specified in the Preliminary
Statements to this Agreement.
"2003 PolyOne Indenture Trustee" means The Bank of New York, as
trustee under the 2003 PolyOne Indenture, and any successor trustee appointed
thereunder.
"2003 PolyOne Notes" has the meaning specified in the Preliminary
Statements to this Agreement.
"2003 PolyOne Notes Holders" means at any time the registered holders
of the 2003 PolyOne Notes issued under the 2003 PolyOne Indenture at such time.
SECTION 1.02. Certain References. In this Agreement, the words
"hereof," "herein" and "hereunder", and words of similar import, shall refer to
this Agreement as a whole and not to any particular provision of this Agreement.
All section, schedule and exhibit references set forth in this
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Agreement are, unless otherwise specified, references to such section in, or
schedule or exhibit to, this Agreement.
ARTICLE II
CONFIRMATION AND CREATION OF SECURITY INTERESTS
SECTION 2.01. Collateral Trust Estate. The Grantor hereby confirms
that, pursuant to the terms of the Shared Collateral Documents to which it is a
party, the Grantor has pledged and assigned to the Collateral Trustee for its
benefit and in trust for the equal and ratable benefit of the Representatives
and the Secured Holders, and has granted the Collateral Trustee for its benefit
and in trust for the equal and ratable benefit of the Representatives and the
Secured Holders a lien on, and security interest in, the Collateral described
therein. The Grantor hereby further pledges and assigns to the Collateral
Trustee for its benefit and in trust for the equal and ratable benefit of the
Representatives, on their behalf and on behalf of the Secured Holders, and
hereby grants to the Collateral Trustee for its benefit and in trust for the
equal and ratable benefit of the Representatives, on their behalf and on behalf
of the Secured Holders, a lien on, and security interest in, the following
(collectively, together with any Successor Collateral, the "Additional
Collateral"):
(i) the Collateral Account established pursuant to Section 3.01(a)
with the Collateral Trustee at its offices at its corporate trust
department in the State of New York and is, and shall at all times remain,
under the sole dominion and control of the Collateral Trustee, all funds
held therein and all certificates and instruments, if any, from time to
time representing each Collateral Account;
(ii) all Cash Equivalents held in the Collateral Account from time to
time and all certificates and instruments, if any, from time to time
representing or evidencing such Cash Equivalents;
(iii) all notes, certificates of deposit, deposit accounts, checks and
other instruments from time to time delivered to or otherwise possessed by
the Collateral Trustee for or on behalf of the Grantor in substitution for
or in addition to any or all of the then existing Additional Collateral;
(iv) all interest, income, dividends, instruments and other property
and assets from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of the then existing Additional
Collateral referred to in clauses (i) through (iii) of this Section
2.01(a); and
(v) all proceeds of any and all of the foregoing Additional Collateral
(including, without limitation, proceeds that constitute property and
assets of the types described in clauses (i) through (iv) of this Section
2.01(a)) and, to the extent not otherwise included, all (A) payments under
any indemnity, warranty or guaranty payable with respect to any of the
foregoing Additional Collateral, and (B) cash.
SECTION 2.02. Security for Secured Obligations. All of the right,
title and interest of the Collateral Trustee in and to the Collateral Trust
Estate secures the payment of all of the Secured Obligations now or hereafter
existing under or in respect of the Secured Agreements and the performance of,
and the compliance with, all of the covenants and conditions of this Agreement,
the other Shared
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Collateral Documents and the Secured Agreements. Without limiting the generality
of the foregoing, the Collateral Trust Estate secures the payment of all amounts
that constitute part of the Secured Obligations and would be owed by the Grantor
to the Collateral Trustee, any Representative or any Secured Holder under the
Shared Collateral Documents or the Secured Agreements but for the fact that they
are unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar proceeding involving the Grantor.
ARTICLE III
COLLATERAL ACCOUNT
SECTION 3.01. Collateral Account. (a) Upon notice by the Agent to the
Collateral Trustee, the Collateral Trustee shall establish and maintain for so
long as any Secured Obligations remain outstanding under any Secured Agreement,
a non-interest bearing cash collateral account (the "Collateral Account") for
the Representatives and the Secured Holders at its offices at its corporate
trust department in the State of New York in accordance with the terms of this
Agreement. All moneys that are received by the Collateral Trustee upon the
occurrence and during the continuance of an Actionable Default, upon liquidation
or otherwise in respect of the Collateral shall be deposited in the Collateral
Account and, thereafter, shall be held and applied by the Collateral Trustee all
in accordance with the terms of this Agreement.
(b) The Collateral Trustee shall, subject to the provisions of Article
IV and Article VIII, from time to time (i) invest amounts on deposit in the
Collateral Account in Cash Equivalents and (ii) invest interest paid on such
Cash Equivalents, and reinvest other proceeds of any such Cash Equivalents that
may mature or be sold, in additional Cash Equivalents, in each case at the
direction of the Grantor so long as no Actionable Default Notice has been
received by the Collateral Trustee (or if an Actionable Default Notice has been
received, it has been withdrawn) and at the written direction of the Required
Representatives if an Actionable Default Notice has been received by the
Collateral Trustee that has not been withdrawn. Interest and proceeds that are
not invested or reinvested in Cash Equivalents as provided in the immediately
preceding sentence shall be deposited and held in the Collateral Account. All
Cash Equivalents made in respect of the Collateral Account and all interest and
income received thereon and therefrom and the net proceeds realized on the
maturity or sale thereof shall be held in the Collateral Account as part of the
Collateral Trust Estate pursuant to the terms hereof.
(c) The Collateral Account shall be subject to such applicable laws,
and such applicable regulations of the Board of Governors of the Federal Reserve
System and of any other appropriate banking or regulatory authority, as are in
effect from time to time.
ARTICLE IV
ACTIONABLE DEFAULTS; REMEDIES
SECTION 4.01. Actionable Default Notice. (a) If, at any time, a
default under any Secured Agreement shall have occurred and be continuing and,
as a result thereof, any Representative or any Secured Holder under, or the
percentage of Secured Holders specified in, such Secured Agreement (any such
party or percentage of Secured Holders being a "Defaulted Agreement Party") has
the right thereunder (without the delivery of any further notice or the
requirement that any further time elapse) to declare all of the Secured
Obligations of the Grantor under such Secured Agreement to be due and payable
prior to the stated maturity thereof (any such default being an "Actionable
Default"), and if such Defaulted Agreement Party gives the Collateral Trustee,
with a copy to the Grantor, a written notice (an "Actionable Default Notice")
stating:
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(i) the nature of the Actionable Default;
(ii) the action requested to be taken by the Collateral Trustee with
respect to the Collateral and the Shared Collateral Documents (which action
may include, without limitation, the calling of a meeting of the
Representatives or the institution of any remedies provided by law or this
Agreement or any Shared Collateral Document); and
(iii) that such Defaulted Agreement Party has polled the
Representatives with respect to such action,
then the Collateral Trustee shall forthwith send a copy of the Actionable
Default Notice to each Representative. The Representatives shall provide the
Collateral Trustee with a certificate that shall state whether or not they favor
the Collateral Trustee taking such action. If the Required Representatives shall
have directed the Collateral Trustee to commence the action set forth in the
Actionable Default Notice (whether or not such poll shall have been taken or
completed), then, subject to Section 4.01(b) and the right of the Collateral
Trustee to commence such action under the Shared Collateral Documents, the
Collateral Trustee shall forthwith undertake such action subject to the
provisions of Section 7.05(d). The Collateral Trustee shall, subject to Sections
4.01(b), 4.08 and 6.06, follow the directions of the Required Representatives
with respect to the time, method and place of taking any action requested in an
Actionable Default Notice. The Collateral Trustee shall be entitled to assume
conclusively that no Actionable Default has occurred and is continuing until it
receives an Actionable Default Notice.
(b) If the Actionable Default, which was the basis for the giving of
an Actionable Default Notice, shall be cured or waived in accordance with the
terms of the applicable Secured Agreement, the Defaulted Agreement Party which
gave such Actionable Default Notice shall promptly notify the Collateral Trustee
in writing of such cure or waiver, upon receipt of such written notice of a cure
or waiver (i) such Actionable Default Notice shall be deemed withdrawn, (ii) the
Collateral Trustee shall deliver to each Representative such writing evidencing
the cure or waiver of a Default Notice as it may have received pursuant to this
Section 4.01(b) and (iii) any direction to the Collateral Trustee to take any
action in connection with such Actionable Default Notice shall be deemed
immediately rescinded. If in connection solely with such withdrawn Actionable
Default Notice the Collateral Trustee shall have been directed to take, and
shall have commenced taking but shall not have completed, any action, the
Collateral Trustee shall promptly terminate any such action which it shall not
also have been directed to take in connection with an Actionable Default Notice
other than that withdrawn.
SECTION 4.02. Direction by Required Representatives. As to any matters
not expressly provided for under this Agreement or the other Shared Collateral
Documents (including, without limitation, matters relating to enforcement and
collection of the Secured Obligations), the Collateral Trustee shall not be
required to exercise any discretion or to take any action under this Agreement
or the other Shared Collateral Documents, or in respect of the Collateral, but
subject to the provisions of Section 7.05(d) shall be required to act or to
refrain from acting (and shall be fully protected in acting or refraining from
acting) in accordance with the written instructions of the Required
Representatives which instructions shall reference Section 6.06.
SECTION 4.03. Right to Initiate Judicial Proceedings, Etc. (a) Upon
the occurrence of and during the continuance of any Actionable Default and the
receipt by the Collateral Trustee of an Actionable Default Notice that has not
been withdrawn pursuant to Section 4.01(b), the Collateral Trustee (i) shall
have the right and power to institute and maintain such suits and proceedings as
it, or the Required Representatives may deem appropriate to protect and enforce
the rights vested in them by this Agreement and the other Shared Collateral
Documents and (ii) may either, after entry or without entry,
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proceed by suit or suits at law or in equity to enforce such rights and to
foreclose upon the Collateral and to dispose of, collect or otherwise realize
upon, all or any portion of the Collateral Trust Estate under the judgment or
decree of a court of competent jurisdiction.
(b) If a receiver of the Collateral Trust Estate shall be appointed in
judicial proceedings, the Collateral Trustee may be appointed as such receiver.
Notwithstanding the appointment of a receiver, the Collateral Trustee shall be
entitled to retain possession and control of all cash held by or deposited with
them or their agents or co-trustees pursuant to any provision of this Agreement
or any other Shared Collateral Document.
SECTION 4.04. Remedies Not Exclusive. (a) No remedy conferred upon or
reserved to the Collateral Trustee herein or in the Shared Collateral Documents
is intended to be a limitation exclusive of any other remedy or remedies, but
every such remedy shall be cumulative and shall be in addition to every other
remedy conferred herein or in the Shared Collateral Documents or now or
hereafter existing at law or in equity or by statute.
(b) No delay or omission of either of the Collateral Trustee to
exercise any right, remedy or power accruing upon any Actionable Default shall
impair any such right, remedy or power or shall be construed to be a waiver of
any such Actionable Default or any acquiescence therein; and every right, power
and remedy given by this Agreement or any Shared Collateral Document to the
Collateral Trustee may be exercised from time to time and as often as may be
deemed expedient by the Collateral Trustee.
(c) In case the Collateral Trustee shall have proceeded to enforce any
right, remedy or power under this Agreement or any Shared Collateral Document
and the proceeding for the enforcement thereof shall have been discontinued or
abandoned for any reason or shall have been determined adversely to such
Collateral Trustee, then and in every such case the Grantor, the Collateral
Trustee, the Representatives and Secured Holders shall, subject to any
determination in such proceeding, severally be restored to their former
positions and rights hereunder and under such Shared Collateral Document with
respect to the Collateral Trust Estate, the Collateral Account and in all other
respects, and thereafter all rights, remedies and powers of such Collateral
Trustee shall continue as though no such proceeding had been taken.
(d) The Grantor expressly agrees that all rights of action and rights
to assert claims upon or under this Agreement and the Shared Collateral
Documents may be enforced by the Collateral Trustee without the possession of
any debt instrument or the production thereof in any trial or other proceeding
relative thereto, and any such suit or proceeding instituted by the Collateral
Trustee shall be brought in either of their names as Collateral Trustee and any
recovery of judgment shall be held as part of the Collateral Trust Estate;
provided that nothing in this Section 4.04(d) shall constitute a waiver of any
right that the Grantor may have or may hereafter acquire to challenge the
amounts outstanding under the Secured Agreements or the continued existence of
the Lien on the Collateral.
SECTION 4.05. Waiver of Certain Rights. The Grantor, on behalf of
itself and all who may claim through or under it, including, without limitation,
any and all subsequent Affiliates, creditors, vendees, assignees and lienors,
expressly waives and releases, to the fullest extent permitted by law, any,
every and all rights to demand or to have any marshalling of the Collateral
Trust Estate upon any enforcement of any Shared Collateral Document, including,
without limitation, upon any sale, whether made under any power of sale herein
granted or pursuant to judicial proceedings or upon any foreclosure or any
enforcement of any Shared Collateral Document or this Agreement and consents and
agrees that all the Collateral Trust Estate and any such sale may be offered and
sold as an entirety.
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SECTION 4.06. Limitation on Collateral Trustee's Duties in Respect of
Collateral. Beyond the duties set forth in this Agreement, the Collateral
Trustee shall not have any duty to the Grantor or the Representatives as to any
Collateral in the Collateral Trustee's possession or control or in the
possession or control of any agent or nominee of the Collateral Trustee or any
income thereon or as to the preservation of rights against prior parties or any
other rights pertaining thereto and the Collateral Trustee shall not have any
liability except for their failure to exercise ordinary care in the handling of
moneys and securities and other property actually received by it.
SECTION 4.07. Limitation by Law. All rights, remedies and powers
provided by this Article IV may be exercised only to the extent that the
exercise thereof does not violate any applicable provision of law, and all the
provisions of this Article IV are intended to be subject to all applicable
mandatory provisions of law which may be controlling and to be limited to the
extent necessary so that they will not render this Agreement invalid,
unenforceable in whole or in part or, if the Representatives elect that this
Agreement should be recorded, registered or filed, not entitled to be recorded,
registered, or filed under the provisions of any applicable law.
SECTION 4.08. Absolute Rights of Secured Holders and Representatives.
Notwithstanding any other provision of this Agreement or any of the other Shared
Collateral Documents, each of the Representatives and each of the Secured
Holders has an absolute and unconditional right to receive payment of all of the
Secured Obligations owing to such Representative or such Secured Holder, as the
case may be, when the same becomes due and payable and at the time and place and
otherwise in the manner set forth in the applicable Secured Agreements, and the
right of each such Representative and each such Secured Holder to institute
proceedings for the enforcement of such payment on or after the date such
payment becomes due and to assert its position as a secured creditor in a
proceeding under the Bankruptcy Code in which the Grantor is a debtor, and the
obligation of the Grantor to pay all of the Secured Obligations owing to each of
the Representatives and each of the Secured Holders at the time and place
expressed therein, shall not be impaired or affected without the consent of such
Representative or such Secured Holder. In addition, the right of any Secured
Holder or any Representative, on behalf of itself or on behalf of any such
Secured Holder, to receive payment or security from sources other than the
Collateral shall not be, and is not hereby, impaired or affected in any manner.
Without limiting the generality of the foregoing provisions of this Section
4.08, no Secured Holder and no Representative, on behalf of itself or on behalf
of any Secured Holder, shall be obligated to share with any other Secured Holder
or any other Representative any proceeds of any collateral, guaranty or right of
setoff other than pursuant to, and to the extent expressly required under, this
Agreement and the other Secured Agreements; nor shall any Secured Holder's or
any Representative's right to receive its ratable share of any amounts
maintained in the Collateral Account, if any, or any proceeds of any of the
Collateral, or any part thereof, under the terms of this Agreement and the other
Shared Collateral Documents be diminished or affected in any way by its right to
receive proceeds of any other collateral or right of setoff, or payment upon a
guaranty or from any other source.
SECTION 4.09. Equal and Ratable Security. This Agreement is intended
solely to comply with the provisions of the Existing Indebtedness Agreements to
secure the unpaid Secured Obligations arising thereunder, equally and ratably
with the Secured Obligations arising under the Guarantee and Agreement. To the
extent that the rights and benefits herein conferred on the Secured Holders or
the Representative under any Existing Indebtedness Agreement exceed the rights
and benefits required so to be conferred by such provisions of such Existing
Indebtedness Agreement, such rights and benefits shall be limited so as to
provide to such Secured Holders and such Representative only those rights and
benefits that are required by such provisions of such Existing Indebtedness
Agreement. Any and all rights not herein expressly given to the Representatives
under any Existing Indebtedness Agreement are expressly reserved to the
Beneficiaries under the Guarantee and Agreement, it being
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understood that in the absence of a requirement to provide equal and ratable
security set forth in the Existing Indebtedness Agreements, this Agreement would
not have been accepted by the Beneficiaries.
ARTICLE V
APPLICATION OF PROCEEDS
SECTION 5.01. Application of Proceeds. (a) If, following the
acceleration of the principal amount of the Secured Obligations under any
Secured Agreement and pursuant to the exercise of any remedy set forth in any
Shared Collateral Document, any Collateral is sold or otherwise realized upon by
the Collateral Trustee, the proceeds received by the Collateral Trustee in
respect of such Collateral shall be deposited in the Collateral Account, and all
moneys held by the Collateral Trustee in the Collateral Account shall, to the
extent available for distribution, be distributed by the Collateral Trustee on
each date upon which a distribution is made (each, a "Distribution Date") as
follows:
FIRST, to the payment (in such priority as the Collateral Trustee
shall elect, but without duplication) of all reasonable legal fees and
expenses and other reasonable costs or expenses or other liabilities of any
kind incurred by the Collateral Trustee as secured parties under any Shared
Collateral Document or otherwise in connection with any Shared Collateral
Document or this Agreement (including, without limitation, any reasonable
costs or expenses or liabilities incurred in connection with the sale of
any assets covered by any Shared Collateral Document, or in the operation
or maintenance of any of the assets covered by any Shared Collateral
Document), including the reimbursement to any Representative of any amounts
theretofore advanced by such Representative for the payment of such fees,
costs and expenses, except only for any such fees, expenses, costs or
liabilities incurred by any Collateral Trustee as a result of its gross
negligence or willful misconduct in performing or failing to perform any of
its duties to the parties hereto expressly set forth herein; provided,
however, that nothing herein is intended to relieve the Grantor of its
duties to pay such costs, fees, expenses and liabilities otherwise payable
to the Collateral Trustee from funds outside of the Collateral Account, as
required by this Agreement;
SECOND, to the Collateral Trustee (without duplication) in an amount
equal to the Collateral Trustee's Fees which are unpaid as of the
Distribution Date and to any Representative which has theretofore advanced
or paid any such Collateral Trustee's Fees in an amount equal to the amount
thereof so advanced or paid by such Representative prior to such
Distribution Date; provided, however, that nothing herein is intended to
relieve the Grantor of its duties to pay such fees and claims from funds
outside of the Collateral Account, as required by this Agreement;
THIRD, in accordance with paragraph (b) below, with respect to any
proceeds, ratably to the Representatives on behalf of the respective
Secured Holders for application to the Secured Obligations of such Secured
Holders, or, to be held by such Representative (or by the Collateral
Trustee on behalf of such Representative pursuant to Section 5.02 or
otherwise) pending such application; provided, however, that any proceeds
received in respect of the Collateral shall be applied first to the
Beneficiary Agent, on behalf of the Beneficiaries, up to the maximum amount
permitted by the terms and conditions of the Existing Indebtedness
Agreements; and
FOURTH, any surplus remaining after the payment in full in cash of the
Secured Obligations shall, pursuant to the provisions of Section 8.02, be
paid to the Grantor, its successors or assigns, or to whomsoever may be
lawfully entitled to receive the same, or as a court of competent
jurisdiction may direct.
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(b) In order to determine the ratable amount to be distributed to each
of the Representatives pursuant to clause THIRD above on each Distribution Date,
unless otherwise directed in writing by the Representatives, the Collateral
Trustee may rely on a certificate of the Chief Financial Officer, Treasurer or
Controller of the Grantor setting forth the Secured Obligations (identified by
type and amount) outstanding under each Secured Agreement on such Distribution
Date. The ratable portion of the aggregate amount available for distribution
hereunder on any Distribution Date which shall be distributed to each
Representative on such Distribution Date shall be a fraction, (i) the numerator
of which shall be the aggregate amount of Secured Obligations of the Secured
Holders represented by such Representative, and (ii) the denominator of which
shall be the aggregate amount of Secured Obligations of all the Secured Holders
represented by all Representatives; provided, however, that the aggregate amount
distributable to such Representative on such Distribution Date shall not exceed
the aggregate amount of Secured Obligations which are then payable by the
Grantor to the Secured Holders of such Representative; and, provided, further,
that, for such purposes, amounts distributable to a Representative on a prior
Distribution Date and held on behalf of such Representative and the Secured
Holders of such Representative pursuant to Section 5.02 shall be deemed to have
been applied to the Secured Obligations of the Secured Holders represented by
such Representative, regardless of whether such application has occurred.
SECTION 5.02. Application of Withheld Amounts. If on any Distribution
Date any amounts on deposit to the Collateral Account are distributable pursuant
to Section 5.01 to any Representative, and if such Representative shall have
given notice to the Collateral Trustee on or prior to such Distribution Date
that all or a portion of such proceeds which are otherwise distributable to such
Representative pursuant to Section 5.01 shall be held by the Collateral Trustee
on behalf of such Representative for the benefit of the Secured Holders of such
Representative, then the Collateral Trustee shall hold such amount in a separate
non-interest bearing cash collateral account of the Collateral Trustee for the
benefit of such Representative and such Secured Holders, until such time as such
Representative shall deliver a written request for the delivery thereof from
such account to such Representative or as such Representative may otherwise
direct in such notice. If thereafter the Secured Obligations of the Secured
Holders represented by any such Representative shall have been repaid in full in
cash on any date, then (a) upon the written request of the Grantor (or any other
Representative) certifying as to such payment in full, and (b) after delivery of
such notice by the Collateral Trustee to such Representative, the Collateral
Trustee shall not have received a written notice of objection from such
Representative within 30 days such Representative's receipt of such notice,
promptly following such 30th day (or the earlier receipt by the Collateral
Trustee of the written consent of such Representative), any amounts held on
account for such Representative pursuant to this Section 5.02 shall be again
deposited by the Collateral Trustee to the Collateral Account and thereafter
distributed as provided in Section 5.01. The Collateral Trustee shall invest
amounts on deposit to any such account in such Cash Equivalents as the
applicable Representative may direct from time to time.
SECTION 5.03. Release of Amounts in Collateral Account. Amounts
distributable to a Representative on any Distribution Date pursuant to Section
5.01 shall be paid to such Representative for the benefit of such Representative
and its Secured Holders by the Collateral Trustee (or deposited to an account
for the benefit of such Representative and its Secured Holders pursuant to
Section 5.02) upon receipt by the Collateral Trustee of a written certificate of
such Representative setting forth appropriate payments instructions for such
Representative. If no such notice is delivered by a Representative within 10
Business Days thereafter, the Collateral Trustee shall deposit amounts otherwise
distributable to such Representative to an account for the benefit of such
Representative and its Secured Holders pursuant to Section 5.02.
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ARTICLE VI
AGREEMENTS WITH THE COLLATERAL TRUSTEE
SECTION 6.01. Delivery of Agreements. The Grantor confirms that it has
delivered to the Collateral Trustee a true and complete copy of each Secured
Agreement, including each Shared Collateral Document, as in effect on the date
hereof. The Grantor agrees that, promptly upon the execution thereof, the
Grantor will deliver to the Collateral Trustee a true and complete copy of any
and all Shared Collateral Documents entered into subsequent to the date hereof
and a true and complete copy of any and all amendments, modifications or
supplements to any of the foregoing.
SECTION 6.02. Information as to Representatives. The Grantor agrees
that it shall deliver to the Collateral Trustee from time to time upon request
of the Collateral Trustee a list setting forth, for each Secured Agreement, (a)
the aggregate principal amount outstanding thereunder, (b) the accrued and
unpaid interest thereunder, (c) the accrued and unpaid fees (if any) thereunder,
(d) the names of the Representatives and of the Secured Holders (to the extent
known to the Grantor) thereunder, and all other unpaid amounts thereunder known
to the Grantor, owing to each such Representative, for its own account and on
behalf of such Secured Holders and (e) such other information regarding the
Representatives, such Secured Holders and the Secured Agreements as the
Collateral Trustee may reasonably request. In addition, the Grantor shall
deliver to the Collateral Trustee, each time a distribution from the Collateral
Trust Estate or the Collateral Account is to be made pursuant to the terms
hereof, not later than two Business Days after receipt of a copy of the
applicable distribution request delivered by a Defaulted Agreement Party
pursuant to Section 5.04, a certificate of the Chief Financial Officer,
Treasurer or Controller of the Grantor, setting forth the amounts to be
distributed and the Persons to whom such distributions are to be made, including
appropriate payment instructions therefor, provided, that if any distribution is
directed to be made to any Representative, if such Representative shall have
notified the Collateral Trustee in writing that such Representative is unable to
accept such distribution, such distribution shall be made instead to an account
established pursuant to Section 5.02 for the benefit of such Representative and
its Secured Holders. The Grantor will furnish to the Collateral Trustee, with a
copy to each Representative, within 10 Business Days after receiving the
Collateral Trustee's reasonable request therefor, a list setting forth the name
and address of each Representative and each Person to whom notices must be sent
under the Secured Agreements and the Grantor agrees to furnish promptly to the
Collateral Trustee any changes or additions to such list of which the Grantor is
made aware. Unless otherwise specified herein, the Collateral Trustee may for
all purposes hereunder, rely on such information given by the Grantor unless (i)
the Collateral Trustee shall have actual knowledge of an inaccuracy or (ii) any
Representative shall provide contrary information in writing with respect to
such Representative in which case, unless such Representative and the Grantor
can reach an agreement on such issue within a period of 10 days, the Collateral
Trustee shall appoint an independent arbitrator (who shall be reasonably
acceptable to the Grantor and such Representative) to resolve the dispute (at
the expense of the Grantor).
SECTION 6.03. Compensation and Expenses. The Grantor agrees to pay to
the Collateral Trustee and any co-trustee or successor trustee appointed
hereunder, from time to time upon demand, (a) such compensation for its services
hereunder and under the Shared Collateral Documents and for administering the
Collateral Trust Estate, the Collateral Account and any account or accounts
established pursuant to Section 5.02 as set forth in the fee letter between the
Grantor and the Collateral Trustee, as such fee letter may be amended,
supplemented or otherwise modified by the written agreement of the Grantor and
the Collateral Trustee from time to time and (b) all the reasonable fees, costs
and expenses incurred by any of them (including, without limitation, the
reasonable fees and disbursements of counsel) (i) arising in connection with the
preparation, execution, delivery, modification and termination of this Agreement
and each Shared Collateral Document or the enforcement of any of the
14
provisions hereof or thereof or (ii) incurred or required to be advanced in
connection with the administration of the Collateral Trust Estate, the
Collateral Account, any account or accounts established pursuant to Section
5.02, the sale or other disposition of Collateral pursuant to any Shared
Collateral Document and the preservation, protection or defense of their rights
under this Agreement and in and to the Collateral, the Collateral Account, any
account or accounts established pursuant to Section 5.02 and the Collateral
Trust Estate. As security for such payment, the Collateral Trustee shall have a
prior lien upon all Collateral and other property and funds held or collected by
the Collateral Trustee as part of the Collateral Trust Estate. The Grantor's
obligations under this Section 6.03 shall survive the termination of this
Agreement.
SECTION 6.04. Stamp and Other Similar Taxes. The Grantor agrees to
indemnify and hold harmless the Collateral Trustee, each Representative and each
Secured Holder from any present or future claim for liability for any stamp or
other similar tax and any penalties or interest with respect thereto, which may
be assessed, levied or collected by any jurisdiction in connection with this
Agreement, any Shared Collateral Document, the Collateral Trust Estate, the
Collateral Account, any account or accounts established pursuant to Section 5.02
or any Collateral. The obligations of the Grantor under this Section 6.04 shall
survive the termination of this Agreement.
SECTION 6.05. Filing Fees, Excise Taxes, Etc. The Grantor agrees to
pay or to reimburse the Collateral Trustee for any and all amounts in respect of
all reasonable search, filing, recording and registration fees, taxes, excise
taxes and other similar imposts which may be payable or determined to be payable
in respect of the execution, delivery, performance and enforcement of this
Agreement and each Shared Collateral Document. The obligations of the Grantor
under this Section 6.05 shall survive the termination of this Agreement.
SECTION 6.06. Indemnification. (a) The Grantor agrees to pay,
indemnify, and hold harmless the Collateral Trustee and each of its agents from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever (including, without limitation, the costs and expenses of
defending any claim against any of them) with respect to the execution,
delivery, enforcement, performance and administration of this Agreement and the
Shared Collateral Documents unless and to the extent arising from the gross
negligence or willful misconduct of such of the Collateral Trustee or such of
its agents as are seeking indemnification or any failure of any Collateral
Trustee or any such agent to exercise ordinary care in the handling of moneys
and securities and other property actually received by any such Collateral
Trustee or any such agent. As security for such payment, any such Collateral
Trustee shall have a prior lien upon all Collateral and other property and funds
held or collected by the Collateral Trustee as part of the Collateral Trust
Estate.
(b) In any suit, proceeding or action brought by the Collateral
Trustee under or with respect to any Shared Collateral Document or the
Collateral for any amount owing thereunder, or to enforce any provisions
thereof, the Grantor will save, indemnify and hold harmless the Collateral
Trustee, the Representatives and the Secured Holders from and against all
expense, loss or damage suffered by reason of any defense, set-off,
counterclaim, recoupment or reduction of liability whatsoever of the obligee
thereunder (unless and to the extent that such expense, loss or damage is caused
by the gross negligence or willful misconduct of the such Collateral Trustee or
the failure of any Collateral Trustee to exercise ordinary care in the handling
of moneys and securities and other property actually received by such Collateral
Trustee), arising out of a breach by the Grantor of any obligation thereunder or
arising out of any other agreement, indebtedness or liability at any time owing
to or in favor of such obligee or its successors from the Grantor and all such
obligations of the Grantor shall be and remain enforceable against and only
against the Grantor and shall not be enforceable against the Collateral Trustee,
any
15
Representative or any Secured Holder. The agreements in this Section 6.06 shall
survive the termination of this Agreement.
SECTION 6.07. Further Assurances. (a) The Grantor agrees, from time to
time, at its own expense to execute, acknowledge, deliver, record, re-record,
file, re-file, register and re-register financing statements and continuations
thereof, notices of assignment, transfers, certificates, assurances and other
instruments and to take such further actions as may be reasonably necessary or
desirable, or as any Collateral Trustee, any Representative, any Secured Holder
through its Representative, may reasonably request from time to time in order
(i) to carry out more effectively the purposes or this Agreement, (ii) to
subject to the liens and security interests created by any of the Shared
Collateral Documents any of the properties, rights or interests of the Grantor
covered or now or hereafter intended to be covered by any of the Shared
Collateral Documents, (iii) to perfect and maintain the validity, effectiveness
and priority of any of the Shared Collateral Documents and the liens and
security interests intended to be created thereby, (iv) to better assure,
convey, grant, assign, transfer, preserve, protect and confirm unto the
Collateral Trustee, the Representatives and the Secured Holders the rights
granted or now or hereafter intended to be granted to the Collateral Trustee,
the Representatives and the Secured Holders under any Shared Collateral Document
or under any other instrument executed in connection with any Shared Collateral
Document to which it is or may become a party, and (v) to enable the Collateral
Trustee to exercise and enforce its rights and remedies hereunder and under each
Shared Collateral Document with respect to any Collateral; provided, however,
that this Section 6.07 shall not be construed to require the Grantor to grant
any interest in Collateral other than pursuant to this Agreement, the Guarantee
and Agreement or any Shared Collateral Document. Without limiting the generality
of the foregoing, the Grantor will take any such action required to be taken by
it pursuant to any Shared Collateral Document.
(b) During the continuance of an Actionable Default, the Grantor
hereby authorizes the Collateral Trustee to file one or more financing or
continuation statements, and amendments thereto, relative to all or any part of
the Collateral without the signature of the Grantor where permitted by law. A
photocopy or other reproduction of this Agreement, any Shared Collateral
Document or any financing statement covering the Collateral or any part thereof
shall be sufficient as a financing statement where permitted by law.
(c) The Grantor will furnish such information about the Collateral as
the Collateral Trustee may reasonably request from time to time.
ARTICLE VII
THE COLLATERAL TRUSTEE
SECTION 7.01. Declaration of Trust. The Collateral Trustee, for itself
and its successors, hereby reaffirms its acceptance of the trusts which are the
subject of this Agreement upon the terms and conditions hereof, including those
contained in this Article VII. Further, the Collateral Trustee, for itself and
its successors, does hereby declare that it will hold all of the estate, right,
title and interest in (a) the Collateral Trust Estate and the Collateral Account
for the equal and ratable benefit of the Representatives and the Secured Holders
as provided herein, and (b) each account as may be established pursuant to
Section 5.02 at the request of a Representative upon the trust herein set forth
and for the benefit of such Representative on behalf of its applicable Secured
Holders as provided herein.
SECTION 7.02. Exculpatory Provisions. (a) The Collateral Trustee shall
not be responsible in any manner whatsoever for the correctness of any recitals,
statements, representations or warranties contained herein or in the Shared
Collateral Documents, all of which are made solely by the
16
Grantor which is a party thereto. The Collateral Trustee makes no
representations as to the value or condition of the Collateral Trust Estate, the
Collateral Account or any part thereof, or as to the title of the Grantor
thereto or as to the security afforded by the Shared Collateral Documents or
this Agreement, or as to the validity, execution (except its own execution),
enforceability, legality or sufficiency of this Agreement, any Shared Collateral
Document or any Secured Agreement, and the Collateral Trustee shall incur no
liability or responsibility in respect of any such matters. The Collateral
Trustee shall not be responsible for insuring the Collateral Trust Estate or for
the payment of taxes, charges, assessments or liens upon the Collateral Trust
Estate or otherwise as to the maintenance of the Collateral Trust Estate or the
Collateral Account, except that in any event that any Collateral Trustee enters
into possession of a part or all of the Collateral Trust Estate, the Collateral
Account, such Collateral Trustee, shall preserve the part in its possession.
(b) The Collateral Trustee shall not be required to ascertain or
inquire as to the performance by the Grantor of any of the covenants or
agreements contained herein, in any other Shared Collateral Document or in any
Secured Agreement. The Collateral Trustee shall not be required to ascertain or
inquire as to the performance by any other party to the Intercreditor Agreement
of any of such party's covenants or agreements contained in the Intercreditor
Agreement.
(c) In connection with the Intercreditor Agreement, the Collateral
Trustee shall be entitled to assume and shall be fully protected in assuming
that it has not received any Collections on account of any Purchased Property or
Unsold Receivables unless and until it has received written notice thereof from
the Bank Agent or the Receivables Agent (capitalized terms used in this sentence
having the definitions specified in the Intercreditor Agreement).
(d) Each of the parties hereto agree that, notwithstanding the
provision in Section 2.11 of the Intercreditor Agreement, that to the extent the
terms and provisions of the Bank Documents (as defined in the Intercreditor
Agreement) or the Receivables Documents (as defined in the Intercreditor
Agreement) are inconsistent with the terms and provisions of the Intercreditor
Agreement, the terms of the Intercreditor Agreement shall control, in entering
into and acting under the Intercreditor Agreement the Collateral Trustee shall
have full benefit of the protective and exculpatory provisions of this
Agreement.
SECTION 7.03. Delegation of Duties. The Collateral Trustee may execute
any of the trusts or powers hereof and perform any duty hereunder either
directly or by or through agents or attorneys-in-fact (which shall not include
officers and employees of the Grantor or any Affiliate of the Grantor). The
Collateral Trustee shall be entitled to rely upon advice of reasonably selected
counsel and other professionals concerning all matters pertaining to such
trusts, powers and duties. The Collateral Trustee shall not be responsible for
the negligence or misconduct of any agents or attorneys-in-fact reasonably
selected by them in good faith.
SECTION 7.04. Reliance by Collateral Trustee. (a) Whenever in the
administration of the trusts of this Agreement or, pursuant to any other Shared
Collateral Document, the Collateral Trustee shall deem it necessary or desirable
that a matter be proved or established in connection with the taking, suffering
or omitting any action hereunder by the Collateral Trustee unless otherwise
provided herein (including, without limitation, the determination of the
composition of the Required Representatives), such matter (unless other evidence
in respect thereof be herein specifically prescribed) may be deemed to be
conclusively proved or established by a certificate of an officer or the
Controller of the Grantor delivered to the Collateral Trustee and the
Representatives, and such certificate shall constitute a full warranty to the
Collateral Trustee for any action taken, suffered or omitted in reliance thereon
unless (i) the Collateral Trustees shall have actual knowledge of an inaccuracy
therein or (ii) any Representative shall provide contrary information in writing
with respect to such matter within 10 days of the date of
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such certificate, in which case unless such Representative and the Grantor can
reach agreement on such issue within a period of 10 days, the Collateral Trustee
shall appoint, at the expense of the Grantor, an American Arbitration
Association arbitrator (who shall be reasonably acceptable to the Grantor and
such Representative) to resolve the dispute.
(b) The Collateral Trustee may consult with independent counsel,
independent public accountants and other experts selected by it (including,
counsel to or any employee of the Grantor or any Affiliate of the Grantor, but
excluding counsel to or any employee of, any Representative or any other Secured
Holder (but not excluding Shearman &Sterling)) and any opinion of such counsel
shall be full and complete authorization and protection in respect of any action
taken or suffered by them hereunder in accordance therewith unless such
Collateral Trustee has actual knowledge of a reason to question the validity or
accuracy of such opinion or of any assumptions expressed therein as the basis
for such opinion. The Collateral Trustee shall have the right at any time to
seek instructions concerning the administration of the Collateral Trust Estate
or the Collateral Account or any account established pursuant to Section 5.02
from the Required Representatives or any court of competent jurisdiction.
(c) The Collateral Trustee may rely, and shall be fully protected in
acting, upon any resolution, statement, certificate, instrument, opinion,
report, notice, request, consent, order, bond or other paper or document which
it reasonably believes to be genuine and to have been signed or presented by the
proper party or parties or, in the case of telecopies and telexes, to have been
sent by the proper party or parties. In the absence of its gross negligence or
willful misconduct, the Collateral Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed therein,
upon any notices, certificates or opinions furnished to the Collateral Trustee
that conform to the requirements of this Agreement or any Shared Collateral
Document.
SECTION 7.05. Limitations on Duties of the Trustee. (a) The Collateral
Trustee undertakes to perform only the duties expressly set forth herein and no
implied covenant or obligation shall be read into this Agreement against the
Collateral Trustee.
(b) The Collateral Trustee may exercise the rights and powers granted
to them by this Agreement and the Shared Collateral Documents, but only pursuant
to the terms of this Agreement, and the Collateral Trustee shall not be liable
with respect to any action taken or omitted by them in accordance with the
direction of the Required Representatives.
(c) Except as herein otherwise expressly provided, the Collateral
Trustee shall not be under any obligation to take any action which is
discretionary with the Collateral Trustee under the provisions hereof or under
any Shared Collateral Document (including, without limitation, the giving of any
consent, notice or request) except upon the written request of the Required
Representatives. The Collateral Trustee shall make available for inspection and
copying by each Representative each certificate or other paper furnished to the
Collateral Trustee by the Grantor, by any Representative, or by any other
Person, under or in respect of this Agreement, any Shared Collateral Document or
any of the Collateral Trust Estate.
(d) The Collateral Trustee shall be under no obligation to exercise
any of the rights or powers vested in them by this Agreement or any other Shared
Collateral Document at the request or direction of any Representatives pursuant
to this Agreement, unless such Representatives shall have offered to the
Collateral Trustee security or indemnity satisfactory to the Collateral Trustee
against the costs, expenses and liabilities which might be incurred by them in
compliance with such request or direction.
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SECTION 7.06. Moneys to Be Held in Trust. All moneys received by the
Collateral Trustee under or pursuant to any provision of this Agreement or any
Shared Collateral Document shall be segregated and held in trust for the
purposes for which they were paid or are held and the Collateral Trustee shall
exercise ordinary care in the handling of any such moneys actually received by
it.
SECTION 7.07. Resignation and Removal of Collateral Trustee. (a) The
Collateral Trustee may at any time, by giving 30 days' prior written notice to
the Grantor and the Required Representatives, resign and be discharged of its
responsibilities hereby created, such resignation to become effective upon the
appointment of a successor trustee or trustees by the Required Representatives,
the acceptance of such appointment by such successor trustee or trustees and,
unless an Actionable Default has occurred and is continuing, the consent to the
appointment of such successor trustee or trustees by the Grantor. If an
Actionable Default has occurred, the Grantor's consent to any such resignation
shall not be required. The Collateral Trustee shall be entitled to its fees and
expenses accrued to the date of the resignation becoming effective. The
Collateral Trustee may be removed at any time (with or without cause) and a
successor trustee or trustees appointed by the affirmative vote of the Required
Representatives, subject to, unless an Actionable Default has occurred and is
continuing, the consent of the Grantor, provided that the Collateral Trustee
shall be entitled to its fees and expenses accrued to the date of removal. If
the Collateral Trustee resigns or is removed as provided in this Section 7.07
the consent to the appointment of a successor trustee or trustees shall not be
unreasonably withheld and shall be deemed to have been given if the Grantor
shall not have reasonably objected to any proposed successor trustee or trustees
within five Business Days of receipt of notice of the identity thereof from the
Representatives. If no successor trustee or trustees shall be appointed and
approved within 30 days from the date of the giving of the aforesaid notice of
resignation or within 30 days from the date of such vote for removal, the
Collateral Trustee, shall, or any Representative may, apply to any court of
competent jurisdiction to appoint a successor trustee or trustees to act until
such time, if any, as a successor trustee or trustees shall have been appointed
as above provided. Any successor trustee or trustees so appointed by such court
shall immediately and without further act be superseded by any successor trustee
or trustees approved by the Representatives as above provided.
(b) If at any time either or both of the Collateral Trustee shall
become incapable of acting, or if at any time a vacancy shall occur in the
office of the Collateral Trustee for any other cause, a successor trustee or
trustees shall be promptly appointed by the Required Representatives, subject
to, unless an Actionable Default has occurred and is continuing, the consent of
the Grantor, which consent shall not be unreasonably withheld, and the powers,
duties, authority and title of the predecessor trustee or trustees terminated
and cancelled without procuring the resignation of such predecessor trustee or
trustees, and without any formality (except as may be required by applicable
law) other than appointment and designation of a successor trustee or trustees
in writing, duly acknowledged, delivered to the predecessor trustee or trustees
and the Grantor and filed for record in each public office, if any, in which
this Agreement is required to be filed.
(c) The appointment and designation referred to in Section 7.07(b)
shall, after any required filing, be full evidence of the right and authority to
make the same and of all the facts therein recited, and this Agreement shall
vest in such successor trustee or trustees, without any further act, deed or
conveyance, all of the estate and title of its predecessor, and upon such filing
for record the successor trustee or trustees shall become fully vested with all
the estates, properties, rights, powers, trusts, duties, authority and title of
its predecessor; but such predecessor shall, nevertheless, on the written
request of the Required Representatives, the Grantor or its successor trustee or
trustees, execute and deliver an instrument transferring to such successor all
the estates, properties, rights, powers, trusts, duties, authority and title of
such predecessor hereunder and shall deliver all securities and moneys held by
it or them to such successor trustee or trustees. Should any deed, conveyance or
other instrument in writing from the Grantor be required by any successor
trustee or trustees for more fully and certainly vesting in such
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successor trustee or trustees the estates, properties, rights, powers, trusts,
duties, authority and title vested or intended to be vested in the predecessor
trustee or trustees, any and all such deeds, conveyances and other instruments
in writing shall, on request of such successor trustee or trustees, be executed,
acknowledged and delivered by the Grantor.
(d) Any required filing for record of the instrument appointing a
successor trustee or trustees as hereinabove provided shall be at the expense of
the Grantor. The resignation of any trustee or trustees and the instrument
removing any trustee or trustees, together with all other instruments, deeds and
conveyances provided for in this Article VII shall, if permitted by law, be
forthwith recorded, registered and filed by and at the expense of the Grantor,
wherever this Agreement is recorded, registered and filed.
SECTION 7.08. Status of Successors to Trustee. Every successor to the
Collateral Trustee appointed pursuant to Section 7.07 shall be a bank or trust
company in good standing and having power so to act, incorporated under the laws
of the United States or any State thereof or the District of Columbia and having
its principal corporate trust office within a state acceptable to the Required
Representatives, and shall also have capital, surplus and undivided profits of
not less than $100,000,000, if there be such an institution with such capital,
surplus and undivided profits willing, qualified and able to accept the trust
upon reasonable or customary terms.
SECTION 7.09. Merger of the Collateral Trustee. Any corporation into
which the Collateral Trustee may be merged, or with which it may be
consolidated, or any corporation resulting from any merger or consolidation to
which the Collateral Trustee shall be a party, shall be the Collateral Trustee
under this Agreement without the execution or filing of any paper or any further
act on the part of the parties hereto.
SECTION 7.10. Additional Co-Trustees; Separate Trustees. (a) If at any
time or times it shall be necessary or prudent in order to conform to any law of
any jurisdiction in which any of the Collateral shall be located, or the
Collateral Trustee shall be advised by counsel satisfactory to them that it is
so necessary or prudent in the interest of the Representatives on behalf of the
Secured Holders, or the Representatives shall in writing so request by notice to
the Collateral Trustee and the Grantor, or the Collateral Trustee shall deem it
desirable for its own protection in the performance of its duties hereunder, or
the Grantor shall in writing so request by notice to the Collateral Trustee with
the consent of the Required Representatives, the Collateral Trustee and the
Grantor shall execute and deliver all instruments and agreements necessary or
proper to constitute another bank or trust company, or one or more persons
approved by the Collateral Trustee, the Grantor and the Representatives, either
to act as co-trustee or co-trustees of all or any of the Collateral, jointly
with the Collateral Trustee originally named herein or any successor, or to act
as separate trustee of any such property. In the event the Grantor shall not
have joined in the execution of such instruments and agreements within 10 days
after the receipt of a written request from the Collateral Trustee so to do, or
in case an Actionable Default Notice has been received by the Collateral Trustee
that has not been withdrawn, the Collateral Trustee may act under the foregoing
provisions of this Section 7.10 without the concurrence of the Grantor (but with
the concurrence of the Required Representatives), and the Grantor hereby
appoints the Collateral Trustee as its agents and attorneys to act for it under
the foregoing provisions of this Section 7.10 in either of such contingencies.
(b) Any separate trustee and any co-trustee (other than any trustee
which may be appointed as successor to the Collateral Trustee pursuant to
Section 7.07) shall, to the extent permitted by law, be appointed and act and be
such, subject to the following provisions and conditions, namely:
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(i) all rights, powers, duties and obligations conferred upon the
trustees in respect of the custody, control and management of moneys,
papers or securities shall be exercised solely by the Collateral Trustee
originally named herein or its successor appointed pursuant to Section
7.07;
(ii) all rights, powers, duties and obligations conferred or imposed
upon the Collateral Trustee hereunder shall be conferred or imposed and
exercised or performed by the Collateral Trustee and such separate trustee
or co-trustee, jointly, as shall be provided in the instrument appointing
such separate trustee or co-trustee, except to the extent that under any
law of any jurisdiction in which any particular act or acts are to be
performed the Collateral Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties and
obligations shall be exercised and performed by such separate trustee or
co-trustee;
(iii) no power given hereby to, or which it is provided hereby may be
exercised by, any such co-trustee or separate trustee, shall be exercised
hereunder by such co-trustee or separate trustee, except jointly with, or
with the consent in writing of, the Collateral Trustee, anything herein
contained to the contrary notwithstanding;
(iv) no trustee hereunder shall be personally liable by reason of any
act or omission of any other trustee hereunder; and
(v) the Grantor and the Collateral Trustee, at any time, by an
instrument in writing, executed by them jointly, may accept the resignation
of or remove any such separate trustee, and in that case, by an instrument
in writing executed by the Grantor and the Collateral Trustee jointly, may
appoint a successor (who shall be acceptable to the Required
Representatives) to such a separate trustee or co-trustee, as the case may
be, anything herein contained to the contrary notwithstanding. In the event
that the Grantor shall not have joined in the execution of any such
instrument within 10 days after the receipt of a written request from the
Collateral Trustee so to do, or in case an Actionable Default Notice has
been received by the Collateral Trustee that has not been withdrawn, the
Collateral Trustee shall have the power to accept the resignation of or
remove any such separate trustee or co-trustee and to appoint (with the
consent of the Required Representatives) a successor without the
concurrence of the Grantor and the Grantor hereby appoints the Collateral
Trustees its agents and attorneys to act for it in such connection in
either of such contingencies. In the event that the Collateral Trustee
shall have appointed a separate trustee or co-trustee or as above provided,
it may at any time, by an instrument in writing, accept the resignation of
or remove any such separate trustee, the successor to any such separate
trustee to be appointed by the Grantor and the Collateral Trustee, or by
the Collateral Trustee alone, as hereinbefore provided in this Section
7.10.
SECTION 7.11. Trustees Appointed Attorneys-in-Fact. The Grantor hereby
irrevocably constitutes and appoints the Collateral Trustee and any officer or
agent thereof, with full power of substitution, as its true and lawful
attorneys-in-fact with full power and authority in the name of the Grantor or
their own name and in the place and stead of the Grantor and in the name of the
Grantor, from time to time at the direction of the Required Representatives, to
take, subject to Section 4.09, any action and to execute any instrument which
the same may deem necessary or advisable to accomplish the purposes of this
Agreement, including, without limitation, to receive, endorse and collect all
instruments made payable to the Grantor representing any dividend, interest
payment or other distribution in respect of the Collateral or any part thereof
and to give full discharge for the same in accordance with the terms of the
Shared Collateral Documents. The Grantor acknowledges and agrees that the
foregoing power of attorney is coupled with an interest and may not be revoked
or modified except with the consent of the Collateral Trustee or as otherwise
provided herein.
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SECTION 7.12. Ordinary Care. The Collateral Trustee shall be deemed to
have exercised ordinary care in the custody and preservation of the Collateral
in its possession if the Collateral is accorded treatment substantially equal to
that which the Collateral Trustee accords its own property, it being understood
that the Collateral Trustee shall not have any responsibility for (i)
ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any Collateral, whether or not
the Collateral Trustee has or is deemed to have knowledge of such matters, or
(ii) taking any necessary steps to preserve rights against any parties with
respect to any Collateral.
ARTICLE VIII
RELEASE OF COLLATERAL
SECTION 8.01. Partial Release of Collateral. (a) The Grantor may, from
time to time so long as no Actionable Default Notice has been received by the
Collateral Trustee (or if an Actionable Default Notice has been received, it has
been withdrawn), request the release of the lien and security interest of the
Shared Collateral Documents in any portion of the Collateral of the Grantor
proposed to be sold or otherwise disposed of by the Grantor to any other Person,
upon notice to the Collateral Trustee from the Chief Financial Officer,
Treasurer or Controller of the Grantor (a "Notice of Partial Release"), which
Notice of Partial Release shall be delivered to the Collateral Trustee and the
Beneficiary Agent at least ten Business Days prior to the date of the proposed
sale or other disposition of such Collateral (unless a shorter period of time is
acceptable to the Collateral Trustee and the Beneficiary Agent) and shall
(i) specify the Collateral to be so sold or otherwise disposed of and
the proposed date of such sale or other disposition, and
(ii) certify that the sale of other disposition of such Collateral is
in compliance with under the terms of the Secured Agreements, and no
Grantor is, and after giving effect to such release, would not be, in
default under any of the Secured Agreements.
If a Notice of Partial Release is delivered to the Collateral Trustee in
accordance with the immediately preceding sentence and the Beneficiary Agent, on
behalf of the Beneficiaries, shall have so approved such action in writing prior
to the date of the proposed release, the security interest in such Collateral
shall automatically, without further action, be released and the Collateral
Trustee shall execute and deliver to the Grantor, on the date of the proposed
release (or as promptly thereafter as possible), a release or releases
(including, without limitation, Uniform Commercial Code release statements and
instruments of satisfaction, discharge and/or reconveyance) in recordable form
provided by the Grantor as to the Collateral specified in such Notice of Partial
Release from the liens, security interests, conveyances and assignments
evidenced by the Shared Collateral Documents, which release shall state that it
is effective as of the date of such disposition; provided, however, that, if
prior to the time that the Collateral Trustee delivers a release pursuant to
this Section 8.01(a), the Collateral Trustee shall have received either (A) an
Actionable Default Notice that shall not have been withdrawn prior to such time
and the Required Beneficiary shall have directed the Collateral Trustee either
not to deliver such a release or not to deliver releases generally or (B) a
written objection from the Beneficiary Agent stating that such sale or other
disposition is not permitted under the Guarantee and Agreement, then, in either
case, the Collateral Trustee shall so notify the Grantor and shall not sign any
release or releases in connection with such disposition.
(b) If, at any time, the Collateral Trustee shall receive a written
notice from the Chief Financial Officer, Treasurer or Controller of the Grantor,
(i) stating that any promissory note or other similar or related instrument
evidencing obligations payable to the Grantor and included in the Collateral
22
has been paid in full in accordance with its terms (or will be so paid
concurrently with the surrender thereof), and (ii) identifying such note or
other instrument in reasonable detail (including, without limitation, by its
date of issuance, the name of its payee and the principal amount thereof), then
the Collateral Trustee shall promptly deliver a copy of each such notice to each
Representative and, unless any Representative shall have disputed the accuracy
of such notice within five Business Days after the delivery of such notice, the
Collateral Trustee shall promptly deliver such note or other instrument to the
Grantor, and promptly execute and deliver a release or releases (including,
without limitation, Uniform Commercial Code release statements) in recordable
form provided by the Grantor as to any such note or other instrument from the
liens, security interests, conveyances and assignments evidenced by the Shared
Collateral Documents, which release shall state that it is effective as of the
date of its delivery.
SECTION 8.02. Full Release of Collateral Upon Satisfaction of Certain
Conditions. (a) Unless the Collateral Trustee shall have received an Actionable
Default Notice that has not been withdrawn, the Collateral Trustee shall
promptly release in accordance with Section 8.03 all of the Collateral upon the
later of (i) the cash payment or performance in full of all of the Guaranteed
Obligations and (ii) the termination of all of the Subject Agreements.
(b) In furtherance of the undertaking set forth above in Section
8.02(a), the Collateral Trustee shall, upon the request of the Grantor
accompanied by a certificate of the Chief Financial Officer, Treasurer or
Controller of the Grantor, upon which the Collateral Trustee may conclusively
rely without independent verification, to the effect that all Guaranteed
Obligations have been, or will, concurrently with the release of the Collateral
be, paid in full in cash (and if such Guaranteed Obligations have not previously
been so paid, describing the source(s) of funds for such repayment), deliver a
notice by registered mail (and immediately thereafter send via facsimile, a copy
of such notice to the Representatives, it being understood that the fax
confirmation sheet shall evidence the fulfillment of the Collateral Trustee's
obligation in this parenthetical) to the Beneficiary Agent (with a copy to each
other Representative) containing the following:
(i) a statement as to the total amount of moneys in the Collateral
Account and any account which has been established at the request of any
Representative pursuant to Section 5.02; and
(ii) a statement that the Collateral Trustee intends to release all
the Collateral unless it receives a written notice from the Beneficiary
Agent within 10 days saying that it has not received cash payment in full
of all the Secured Obligations owed to the Beneficiary Agent or the
Beneficiaries under the Guarantee and Agreement, or, if such Secured
Obligations are to be repaid concurrently with such release, a statement
that the Collateral Trustee will release such Collateral only upon receipt
from the Beneficiary Agent of instructions to do so.
If the Collateral Trustee does not receive a certificate from the Beneficiary
Agent within 10 days after the delivery of such notice stating that such Secured
Obligations have not been indefeasibly paid in full in cash, or the Collateral
Trustee receives a direction from the Beneficiary Agent so to release such
Collateral, as the case may be (and the Collateral Trustee shall not have
received any notice that an Actionable Default has occurred or is continuing),
then the Collateral Trustee shall release all the Collateral from the security
interest in their favor and deliver to the Grantor all Collateral in the
possession of the Collateral Trustee promptly after the expiration of such 10
day period or as specified in such instruction, as the case may be; provided,
however, that the Grantor shall have made adequate provision for the expenses of
the Collateral Trustee associated with such release of Collateral, fees and all
other expenses of, or payable to, the Collateral Trustee hereunder or under any
Shared Collateral Document; and provided, further, that the failure of the
Beneficiary Agent to provide a certificate to the Collateral Trustee pursuant to
this Section 8.02 shall in no way be deemed a waiver of, or otherwise
23
impair in any way, its rights to receive payment in respect of unpaid Secured
Obligations. If the Collateral Trustee shall have received such a certificate
from the Beneficiary Agent within such 10 day period, or shall not have received
an instruction so to release such Collateral (or shall have received an
Actionable Default Notice which has not been withdrawn), as the case may be, the
Collateral Trustee shall not release the Collateral unless and until the
Beneficiary Agent or a court of competent jurisdiction so directs the Collateral
Trustee pursuant to a final, non-appealable judgment (including a judgment that
becomes non-appealable by reason of expiration of any period of time limiting
the right to appeal therefrom).
SECTION 8.03. Effect of Release of Collateral. Upon the effectiveness
of the release of the Collateral pursuant to Section 8.02, all right, title and
interest of the Collateral Trustee and the Representatives on behalf of the
Secured Holders in, to and under the Collateral Trust Estate, the Collateral and
the Shared Collateral Documents shall terminate and shall revert to the Grantor
and its successors and assigns, and the estate, right, title and interest of the
Collateral Trustee therein shall thereupon cease; and in such case, upon the
written request of the Grantor, its successors or assigns, and at the cost and
expense of the Grantor, its successors or assigns, the Collateral Trustee shall
promptly execute and deliver a satisfaction of the Shared Collateral Documents
and such instruments as are necessary or desirable to terminate and remove of
record any documents constituting public notice of the Shared Collateral
Documents and the security interests granted thereunder and shall transfer, or
cause to be transferred, and shall deliver or cause to be delivered to the
Grantor, all property, including all moneys, instruments and securities of the
Grantor then held by the Collateral Trustee. The cancellation and satisfaction
of the Shared Collateral Documents shall be without prejudice to the rights of
the Collateral Trustee or any successor trustee or trustees to charge and be
reimbursed for any expenditures which it may thereafter incur in connection
therewith.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Supplements and Waivers. (a) (i) With the
written consent of the Beneficiary Agent and the Collateral Trustee, the Grantor
may, from time to time, enter into written agreements supplemental hereto for
the purpose of adding to or waiving any provision of this Agreement or any of
the Shared Collateral Documents or changing in any manner the rights or
obligations of the Collateral Trustee, the Representatives, the Secured Holders
and the Grantor hereunder or thereunder.
(ii) Any such supplemental agreement shall be binding upon the
Grantor, the Representatives, the Secured Holders and the Collateral Trustee and
its respective successors.
(iii) The Collateral Trustee shall not enter into any such
supplemental agreement unless it shall have received a certificate of the Chief
Financial Officer, Treasurer or Controller of the Grantor to the effect that
such supplemental agreement will not result in a breach of any provision or
covenant contained in any of the Secured Agreements.
(iv) (v) The Collateral Trustee shall not enter into any such
supplemental agreement unless it shall have received a certificate of the
Beneficiary Agent to the effect that, upon receipt of the Collateral Trustee's
written consent, this Section 9.01(a) has been complied with and an instruction
letter requesting the Collateral Trustee to execute such supplemental agreement.
(b) Notwithstanding the provisions of paragraph (a), the Collateral
Trustee and the Grantor may, at any time and from time to time, without the
consent of the Beneficiary Agent and any
24
other Representative or any Secured Holders, enter into additional Shared
Collateral Documents or one or more agreements supplemental hereto or to any
Shared Collateral Document, in form satisfactory to the Collateral Trustee,
(i) to add to the covenants of the Grantor, for the benefit of the
Representatives or any Secured Holder, or to surrender any right or power
herein conferred upon the Grantor;
(ii) to pledge or grant a security interest in favor of the Collateral
Trustee as additional security for the Secured Obligations any property or
assets which are required to be pledged, or in which a security interest is
required to be granted, to the Collateral Trustee pursuant to any Shared
Collateral Document or otherwise; or
(iii) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising
under this Agreement which shall not be inconsistent with the provisions of
this Agreement, provided such action shall not adversely affect the
interests of the Secured Holders.
SECTION 9.02. Additional Actions of Representatives. Whether or not
there shall be an Actionable Default, the Collateral Trustee shall comply and
shall be fully protected in complying with any reasonable request of (a) the
Required Representatives, to take or refrain from taking certain actions with
respect to the Collateral or the Representatives, and (b) more than 50% of the
Secured Holders represented by any Representative which has requested that an
account be opened pursuant to Section 5.02, to take or refrain from taking
certain actions with respect to such account, provided, in each case, that the
Collateral Trustee shall have been indemnified as provided in Section 7.05(d)
and the Collateral Trustee shall not take or refrain from taking such actions if
to do so would violate applicable law or the terms of this Agreement, the Shared
Collateral Documents or the applicable Secured Agreements.
SECTION 9.03. Notices. All notices, requests, demands and other
communications provided for or permitted hereunder shall, unless otherwise
stated herein, be in writing (including telex and telecopy communications) and
shall be sent by mail (by registered or certified mail, return receipt
requested), overnight prepaid courier, telex, telecopier or hand delivery:
(a) If to the Grantor, at 00000 Xxxxxx Xxxx, Xxxx Xxxx, Xxxx 00000,
Attention: Treasurer or at such other address as shall be designated by it
in a written notice to the Collateral Trustee;
(b) If to the Collateral Trustee, at 00 Xxxxxxxx, Xxx Xxxx, XX 00000,
Attention: Corporate Trust Division, or at such other address as shall be
designated by it in a written notice to the Grantor and each
Representative; and
(c) If to any Representative, to it at the address specified from time
to time in the list provided by the Grantor to the Collateral Trustee
pursuant to Section 6.02 with copies to whomever (other than the Grantor)
is specified by the Grantor pursuant to Section 6.02 as a Person to whom
notice must be sent under the Secured Agreements, provided that in the case
that no address is known for a Representative, notice shall be given to it
in the manner specified by the related Secured Agreement, and, in the
absence of any such specified means of giving notice, by such notice in the
national edition of The Wall Street Journal or as the Collateral Trustee
shall determine to be reasonable. For purposes of notice by publication,
one notice is sufficient and shall be deemed made on the date of its
publication.
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All such notices, requests, demands and communications shall be deemed to have
been duly given, made or delivered, (i) effective when delivered by hand, (ii)
five Business Days after being deposited in the mail, postage prepaid, (iii) the
next Business Day if delivered by an overnight prepaid courier, (iv) when
telexed with answerback, (v) when telecopied or (vi) when published in the The
Wall Street Journal or such other publication; provided, however that any
notice, request, demand or other communication to the Collateral Trustee or to
the Grantor or the Beneficiary Agent shall not be effective until received and,
provided, further, that any notice to the Collateral Trustee from the Grantor
shall be signed by an officer or the Controller of the Grantor, unless otherwise
specifically set forth herein.
SECTION 9.04. Headings. Section, subsection and other headings used in
this Agreement are for convenience only and shall not affect the construction of
this Agreement.
SECTION 9.05. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall not invalidate the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 9.06. Treatment of Payee or Indorsee by Trustee. (a) The
Collateral Trustee may treat the registered Secured Holder of any registered
note, and the payee or indorsee of any note or debenture which is not
registered, as the absolute owner thereof for all purposes hereunder and shall
not be affected by any notice to the contrary, whether such promissory note or
debenture shall be past due or not.
(b) Any person, firm, corporation or other entity which shall be
designated as the duly authorized representative of one or more Representatives
to act as such in connection with any matters pertaining to this Agreement or
any Shared Collateral Document or the Collateral shall present to the Collateral
Trustee such documents, including, without limitation, opinions of counsel, as
the Collateral Trustee may reasonably require, in order to demonstrate to the
Collateral Trustee the authority of such person, firm, corporation or other
entity to act as the representative of such Representatives.
SECTION 9.07. Dealings with the Grantor. Upon any application or
demand by the Grantor to the Collateral Trustee to take or permit any action
under any of the provisions of this Agreement, the Grantor shall (unless
otherwise waived by the Collateral Trustee in writing) furnish to the Collateral
Trustee a certificate signed by its Chief Financial Officer, Treasurer or
Controller stating that all conditions precedent, if any, provided for in this
Agreement relating to the proposed action have been complied with, except that
in the case of any such application or demand as to which the furnishing of such
documents is specifically required by any provision of this Agreement relating
to such particular application or demand, no additional certificate need be
furnished.
SECTION 9.08. Claims. This Agreement is made for the benefit of the
Representatives on behalf of the Secured Holders, and the Representatives may
from time to time enforce their rights as explicit beneficiaries hereunder.
SECTION 9.09. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of each of the parties hereto and shall inure to the
benefit of the Representatives on behalf of the Secured Holders and their
respective successors and assigns and nothing herein or in any Shared Collateral
Document is intended or shall be construed to give any other Person any right,
remedy or claim under, to or in respect of this Agreement, any Shared Collateral
Document, the Collateral, the Collateral Account or the Collateral Trust Estate
or any part thereof.
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SECTION 9.10. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
SECTION 9.11. Effectiveness. This Agreement shall become effective on
the execution and delivery hereof and shall remain in effect so long as the
Collateral Trustee shall have any obligations hereunder.
SECTION 9.12. Reexecution of Agreement. This Agreement shall be
reexecuted at any time and from time to time, at the request of the Required
Representatives, with such changes in the form hereof (including, without
limitation, changes on the cover page and adding supplemental signatures and
notary statements) as may be necessary to comply with the filing or recording
requirements of any jurisdiction where this Agreement is to be filed.
SECTION 9.13. Effect on Guarantee and Agreement. Nothing in this
Agreement shall operate or be deemed to prevent any amendment, modification or
waiver of the Guarantee and Agreement or other Transaction Documents by the
parties thereto in accordance with the terms thereof.
SECTION 9.14. Counterparts. This Agreement may be executed in separate
counterparts, each of which shall be an original and all of which taken together
shall constitute one and the same instrument
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
caused this Agreement to be duly executed and delivered by their respective
officers thereunto duly authorized as of the date first above written.
Grantor: POLYONE CORPORATION,
an Ohio corporation, as Grantor
By
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Title:
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Collateral Trustee: U.S. BANK TRUST NATIONAL ASSOCIATION,
as Collateral Trustee
By:
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Title:
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