Exhibit 10.68
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COLLATERAL ASSIGNMENT OF LOCATION LEASES
COLLATERAL ASSIGNMENT OF LEASES ("Assignment") dated as of January 8,
1997 by COINMACH CORPORATION, a Delaware corporation ("Assignor") in favor of
BANKERS TRUST COMPANY, a New York banking corporation, having an office at 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, in its capacity as collateral agent
(in such capacity and together with any successor in such capacity, the
"Collateral Agent") for the Secured Creditors (as hereinafter defined).
R E C I T A L S :
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A. Assignor, Coinmach Laundry Corporation, certain subsidiaries of
Assignor, the lenders (the "Banks") from time to time party thereto, Bankers
Trust Company, as Administrative Agent (together with any successor, the
"Administrative Agent"), First Union Corporation, as Syndication Agent (together
with any successor, the "Syndication Agent") and Xxxxxx Commercial Paper, Inc.,
as Documentation Agent (together with any successor, the "Documentation Agent")
have entered into a Credit Agreement, dated as of the date hereof, providing for
the making of loans and the issuance of and participation in, letters of credit,
as contemplated therein (such agreement, as amended, modified, extended,
renewed, replaced, restated or supplemented from time to time, and including any
agreement extending the maturity of, or restructuring all or any portion of the
indebtedness under such agreement or any successor agreement, the "Credit
Agreement"). Except as otherwise defined herein, terms used herein and defined
in the Credit Agreement shall be used herein as so defined.
B. Assignor is, or is the successor in interest to, the lessee under
those certain leases (individually, a "Lease"; collectively, the "Leases"), a
complete list of which is attached as Exhibit A hereto, with the respective
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lessors (individually, a "Lessor"; collectively, the "Lessors") thereto. The
Leases pertain to the properties (the "Premises") which are described on Exhibit
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B hereto.
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C. Assignor may at any time and from time to time enter into, or
guarantee obligations of its Subsidiaries under, one or more Interest Rate
Protection or other Hedging Agreement (each as hereinafter defined) with one or
more Other Creditors (as hereinafter defined).
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D. It is a condition to each of the above-described extensions of
credit to the Assignor that the Assignor shall have executed and delivered this
Assignment.
E. This Assignment is made by Assignor in favor of the Collateral
Agent for the benefit of (x) the Banks, the Administrative Agent, the
Syndication Agent, the Documentation Agent, the Collateral Agent and any other
lenders from time to time party to the Credit Agreement (collectively, the "Bank
Creditors") and (y) if one or more Banks or any Affiliate of a Bank enters into
one or more (i) interest rate protection agreements (including, without
limitation, interest rate swaps, caps, floors, collars and similar agreements),
(ii) foreign exchange contracts, currency swap agreements or other similar
agreements or arrangements designed to protect against the fluctuations in
currency values and/or (iii) other types of hedging agreements from time to time
(collectively, the "Interest Rate Protection or Other Hedging Agreements"),
with, or guaranteed by Assignor, any such Bank or Banks or Affiliate or
Affiliates (even if the respective Bank subsequently ceases to be a Bank under
the Credit Agreement for any reason) so long as any such Bank or Affiliate
participates in the extension of such Interest Rate Protection or Other Hedging
Agreement and their subsequent assigns, if any, (collectively, the "Other
Creditors"; together with the Bank Creditors, the "Secured Creditors"). This
Assignment is given to Collateral Agent to secure the Obligations (as defined in
the Security Agreement).
A G R E E M E N T :
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Assignor and Collateral Agent hereby agree as follows:
1. Assignment. Assignor hereby transfers and assigns to Collateral
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Agent all of Assignor's right, title and interest, whether now owned or
hereafter acquired, in and to each of the Leases. This assignment of the Leases
is made as collateral security for the payment and performance of the Secured
Obligations.
2. No Assumption of Obligations or Duties of the Assignor. This
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Assignment is an assignment only of all right, title and interest of the
Assignor in the Leases, and Assignor covenants and agrees to perform and observe
all of all material obligations imposed upon Assignor under the Leases as if
this Assignment had not been made. Assignor agrees that the Secured
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Creditors have not assumed and will not be deemed to have assumed any of the
obligations or duties of Assignor under or with respect to the Leases unless and
until the Secured Creditors shall have given the parties to the Leases written
notice that the Secured Creditors have affirmatively assumed such obligations
and duties as the result of an Event of Default under the Credit Agreement or
the Leases.
3. Representations, Warranties and Covenants of Assignor. Assignor
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represents, warrants and covenants to Collateral Agent:
a. (i) That Schedule A attached hereto contains a complete list as of
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the date hereof of the Leases, (ii) that Assignor is the sole owner of the
entire leasehold interest in each Lease, free and clear and of all Liens, except
for the Liens created in favor of the Collateral Agent pursuant to, or in
connection with, the Credit Agreement, (iii) each Lease is valid and
enforceable, subject to the effect of this Assignment and bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance and similar laws,
and has not been altered, modified or amended in any manner, except as shown on
Exhibit A, (iv) to Assignor's knowledge, neither Assignor nor the Lessor under
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any Lease is in default under such Lease nor, to the knowledge of Assignor, has
any event occurred (other than pursuant to this Assignment) which with the
passage of time or the giving of notice would constitute a default under such
Lease and (v) no rent reserved in any Lease has been assigned or prepaid except
for prepaid rent for the current month and applicable security deposits.
b. Assignor agrees (i) to observe and perform all material
obligations imposed upon Assignor as the lessee under each Lease and not to do,
or permit to be done, anything to materially impair Assignor's rights
thereunder; (ii) not to assign Assignor's interest under any Lease or sublet all
or any part of the Premises, (iii) other than upon the expiration of the terms
of the respective Leases in accordance with their terms, not alter, modify or
change the terms of any Lease in any material respect, or cancel or terminate
any Lease, or surrender possession of the Premises, or any part thereof, without
the prior written consent of Collateral Agent, which consent shall not be
unreasonably withheld and (iv) to use reasonable efforts to enforce the
performance by the Lessor under each Lease of all of such Lessor's obligations
under such Lease.
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c. Assignor has full power and authority to execute, deliver and
perform its obligations under this Assignment.
d. In the event that Assignor receives a written landlord consent
from the Lessors under the Leases, this Assignment shall be a legal, valid and
binding obligation of Assignor, enforceable in accordance with its terms with
respect to those Leases.
e. Assignor agrees that Collateral Agent shall have the right,
exercisable at any time that the Collateral Agent believes in its commercially
reasonable business judgment, that there is a substantial risk that the Assignor
will not be able to perform its obligations under the Credit Agreement and the
other Credit Documents, to notify the Lessor under any or all of the Leases that
the Assignor has executed and delivered this Assignment to the Collateral Agent.
4. Appointment of the Collateral Agent as Attorney-in-Fact. Assignor
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hereby irrevocably constitutes and appoints Collateral Agent as its attorney-in-
fact to demand, receive and enforce the respective rights and interests of
Assignor with respect to the Leases at any time after the occurrence and during
the continuance of an Event of Default under the Credit Agreement and the
delivery to Assignor of notice in accordance with Article X of the Credit
Agreement, and give appropriate notices for and on behalf of and in the name of
Assignor or either of them or, at the option of Collateral Agent in the name of
Collateral Agent, with the same force and effect as Assignor could do if this
Assignment had not been made.
5. Effect of Assignment; Remedies for Default. The Assignment shall
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constitute an absolute and present assignment; provided, however, that
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Collateral Agent shall have no right under this Assignment to enforce the
provisions of any Lease unless there shall occur and be continuing an Event of
Default under the Credit Agreement. Upon the occurrence and during the
continuance of any such Event of Default, Collateral Agent may, without
affecting any of its or the Secured Creditors rights or remedies against
Assignor under any other instrument, document or agreement, exercise its rights
under this Assignment as attorney-in-fact of Assignor in any manner permitted by
law, and Collateral Agent shall have the right to exercise and enforce any or
all rights and remedies available after default to a secured party under the
applicable Uniform Commercial Code. If notice to Assignor of any intended
disposition of collateral or any
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other intended action is required by law in a particular instance, such notice
shall be deemed commercially reasonable if given at least ten day's prior to the
date of intended disposition. During the continuance of an Event of Default,
Collateral Agent may (i) either in person or by agent, with or without bringing
any action or proceeding, or by a receiver appointed by a court, take possession
of any or all of the Premises and have, hold, manage, lease and operate the
same, on such terms, and for such period of time, as Collateral Agent may deem
proper (but in no event beyond the stated term of the Lease, including any
options to extend) and (ii) in connection with the exercise of its rights under
clause (i) above, terminate all of Assignor's right to retain, use and enjoy all
rights under any Lease.
6. Indemnification. After the occurrence, and during the
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continuance, of an Event of Default, Collateral Agent may, but shall not be
obligated to, perform or discharge any obligation, duty or liability under any
Lease or under or by reason of this Assignment. Furthermore, Assignor shall,
and hereby agrees to, indemnify, defend and hold Collateral Agent harmless from,
and against, any and all liability, loss, cost, damage or expense which may, or
might be, incurred by Collateral Agent, directly, or indirectly, under any Lease
or under or by reason of this Assignment and from any and all claims and demands
whatsoever which may be asserted against Collateral Agent by reason of any
alleged obligations or undertakings on its part to perform or discharge any of
the covenants or agreements contained in any Lease other than any such
liability, loss, cost or expense incurred as a result of the gross negligence or
willful misconduct of Collateral Agent. If Collateral Agent incurs any such
liability under any Lease or under or by reason of this Assignment or in defense
of any such claims or demands, the amount thereof, including all costs, expenses
and reasonable attorneys' fees, shall be added to the Secured Obligations and
Assignor shall reimburse Collateral Agent therefor immediately upon demand, and,
upon the failure of Assignor to reimburse Collateral Agent within 10 days of
demand, Collateral Agent, at its option, may declare all of the Secured
Obligations immediately due and payable. The parties hereto understand further
that this Assignment shall not operate to place responsibility for the control,
care, management or repair of any of the Premises upon Collateral Agent (except
as provided in the Lease for matters first arising after Collateral Agent has
taken physical possession of the Premises, except for possession solely for the
purpose of disposing of the assets of Assignor), or for
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the carrying out of any of the terms or conditions of any Lease (except for
matters first arising after Collateral Agent has taken physical possession of
the Premises, except for possession solely for the purpose of disposing of the
assets of Assignor), and it shall not operate to make Collateral Agent
responsible or liable for any waste committed on any of the Premises by Assignor
or any of the Premises or for any negligence in the management, upkeep, repair
or control of any of the Premises, resulting in loss, injury or death to any
lessee, sublessee, invitee, licensee, employee, stranger or any other Person.
7. Remedies Cumulative. No right or remedy of Collateral Agent
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hereunder is exclusive of any other right or remedy hereunder or now or
hereafter existing at law or in equity or under the Credit Agreement, the Notes
or the other Credit Documents, but is cumulative and in addition thereto and
Collateral Agent may recover judgment thereon, issue execution therefor, and
resort to every other right or remedy available at law or in equity or under the
Credit Agreement, the Notes or the other Credit Documents, without first
exhausting or affecting or impairing the security or any right or remedy
afforded under this Assignment. No delay in exercising, or omission to
exercise, any such right or remedy will impair any such right or remedy or will
be construed to be a waiver of any default by Assignor hereunder, or
acquiescence therein, nor will it affect any subsequent default hereunder by
Assignor of the same or different nature. Every such right or remedy may be
exercised independently or concurrently, and when and so often as may be deemed
expedient by Collateral Agent. No term or condition contained in this
Assignment may be waived, altered or changed except as evidenced in writing
signed by Assignor and Collateral Agent. In case Collateral Agent shall have
proceeded to enforce any right under this Assignment and such proceedings shall
have been discontinued or abandoned for any reason, or shall have been
determined adversely to Collateral Agent then, and in every such case, Assignor
and Collateral Agent shall be restored to their former positions with respect to
the Leases, and all rights, remedies, and powers of Collateral Agent shall
continue as though no such proceedings had been taken.
8. Costs and Expenses. Assignor hereby agrees to pay all reasonable
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costs and expenses (including, without limitation, reasonable attorney's fees
and expenses) which Collateral Agent or the Secured Creditors may incur in
exercising and enforcing any of their rights and remedies under this Assignment
after the occurrence and during the continuance of an Event of Default.
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9. Successors and Assigns. Subject to the limitations on further
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assignment of the Leases by Assignor contained herein, this Assignment shall be
binding upon Assignor and its successors and assigns, and shall inure to the
benefit of Collateral Agent and its successors and assigns. Collateral Agent
may assign its right, title and interest in the Leases upon notice to the
Assignor, but without any requirements for the consent of Assignor.
10. Amendment. This Assignment can be waived, modified, amended,
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terminated or discharged only explicitly in a writing signed by Collateral
Agent. A waiver signed by Collateral Agent shall be effective only in the
specific instance and for the specific purpose given.
11. Termination. This Assignment shall terminate and be of no
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further force and effect as of the date upon which the Commitments of the Banks
and all Interest Rate Protection and Other Hedging Agreements have been
terminated, no Note under the Credit Agreement is outstanding (and all Loans
have been repaid in full), all Letters of Credit have been terminated and all
Secured Obligations then owing have been paid in full. Upon such termination,
at the request of Assignor, Collateral Agent shall provide written confirmation
of such termination to Assignor in form reasonably requested by Assignor, at
Assignor's cost and expense.
12. Governing Law. This Assignment shall be governed by, and shall
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be construed and enforced in accordance with the laws of the State of New York,
without regard to principles of conflicts of law.
13. Notices. Any notice delivered by Assignor or Collateral Agent
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hereunder shall be delivered in the manner provided in the Credit Agreement.
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IN WITNESS WHEREOF, Assignor and Collateral Agent have executed this
Assignment as of the date first set forth above.
COINMACH CORPORATION,
as Assignor
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Senior Vice President
BANKERS TRUST COMPANY,
as Collateral Agent,
By: /s/ Xxxxxxxx Xxxxx
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Name: Xxxxxxxx Xxxxx
Title: Vice President
