Exhibit 10.6
SINKING FUND COLLATERAL ACCOUNT AND PLEDGE AGREEMENT
THIS SINKING FUND COLLATERAL ACCOUNT AND PLEDGE AGREEMENT, dated as of
March 17, 2004 (as the same may be amended, modified, supplemented or restated
from time to time, this "Agreement"), is made between MANUFACTURERS AND TRADERS
TRUST COMPANY, a New York banking corporation, as collateral agent (in such
capacity, the "Collateral Agent") for each of the Lenders under the Credit
Agreement referred to below, and AMERICAN ROCK SALT COMPANY LLC, a New York
limited liability company (the "Borrower"). Capitalized terms used herein and
not defined elsewhere herein shall have the meanings given to them in the Credit
Agreement referred to below.
PRELIMINARY STATEMENTS:
A. The Borrower, the Collateral Agent, the Letters of Credit Issuer and the
Lenders are parties to a Credit Agreement, dated as of March 17, 2004 (as
amended, modified, supplemented or restated from time to time, the "Credit
Agreement"), pursuant to which the Lenders have agreed to make Revolving Loans
and Term Loans to the Borrower and participate in Letters of Credit, and the
Letters of Credit Issuer has agreed to issue the Letters of Credit for the
benefit of the Borrower, upon the terms and conditions set forth therein.
B. The Credit Agreement provides that the Borrower shall establish a
Sinking Fund Collateral Account with the Collateral Agent and make deposits
therein on a scheduled basis and upon the occurrence of certain events as more
particularly provided therein.
C. The Credit Agreement further provides that the funds in the Sinking Fund
Collateral Account shall secure the repayment of all Credit Obligations and in
certain circumstances, the Surety L/C Reimbursement Obligations, the accrued
interest thereon and amounts owed by Borrower in connection therewith. The
Credit Agreement also provides that in certain circumstances provided no Default
or Event of Default exists and the Credit Obligations have not been accelerated
and become due and payable, a specificed amount of the funds in the Sinking Fund
Collateral Account shall be disbursed to the Agent who will be authorized under
the Credit Agreement to deliver such funds to the Borrower.
D. It is a condition precedent to the Lenders providing the financial
accommodations contemplated by the Credit Agreement that the Borrower shall, by
executing and delivering this Agreement, establish the Sinking Fund Collateral
Account pursuant to the terms and conditions herein and grant and assign to the
Collateral Agent a first priority, valid and perfected security interest in such
account and all of the funds, securities, investments and proceeds at any time
held therein pursuant to the terms of this Agreement, the Credit Agreement
and/or the Credit Documents.
NOW, THEREFORE, in consideration of the premises, and to induce the Agent,
the Lenders, the Letters of Credit Issuer and the Collateral Agent to enter into
the Credit Agreement and to make the Loans to the Borrower and issue for the
Borrower's account and/or participate in the Letters of Credit thereunder, the
parties hereby agree as follows:
1. Creation of Sinking Fund Collateral Account and Deposits Therein.
(a) The Borrower shall establish an account entitled "American Rock
Salt Surety L/C Sinking Fund Collateral Account" with Manufacturers & Traders
Trust Company (ABA No. 000 000 000), Account No. 9836148214. All undisbursed
interest and income on the Sinking Fund Collateral Account Funds shall be deemed
part of the Sinking Fund Collateral Account and shall constitute Collateral
secured under Section 3 hereof. Subject to the provisions of this Agreement, the
Collateral Agent shall have sole dominion and control over the Sinking Fund
Collateral Account and shall have sole authority to make withdrawals therefrom.
Except as expressly provided below, the Sinking Fund Collateral Account shall be
maintained and administered by the Collateral Agent. Neither the Borrower, nor
any Person claiming by, through, under or on behalf of the Borrower, shall have
any right to withdraw anything from the Sinking Fund Collateral Account,
including any accrued interest included within the "Sinking Fund Collateral
Account Funds" (as defined below). All deposits of funds into, investment of
funds held in, and disbursements of funds from the Sinking Fund Collateral
Account made at any time or from time to time prior to the termination of this
Agreement, shall be made on the terms and conditions set forth herein.
(b) The Borrower shall deposit in immediately available funds into the
Sinking Fund Collateral Account all amounts required to be deposited therein by
the Credit Agreement at the times required to do so by the Credit Agreement.
2. Withdrawals; Disbursements; Application of Proceeds. Subject to the
terms of Sections 3.2 (e) and 5.2 of the Credit Agreement and the other terms
and conditions herein:
(a) Repayment of Surety L/C Reimbursement Obligations, etc. The
Collateral Agent may at any time and from time to time (i) withdraw from the
Sinking Fund Collateral Account and disburse to the Agent for its account and
the account of the Surety L/C Issuer and the Surety L/C Participants an amount
of the Sinking Fund Collateral Account Funds equal to the Surety L/C
Reimbursement Obligations and all accrued interest thereon for the purpose of
repaying such amounts in accordance with the terms of the Credit Agreement, and
(ii) withdraw from the Sinking Fund Collateral Account and retain for its own
account all amounts owed to the Collateral Agent hereunder. If at any time the
Agent and the Collateral Agent are not the same financial institution or
affiliates, then the Agent shall give the Collateral Agent written notice
promptly after any draws are made on the Surety L/C which result in Surety L/C
Reimbursement Obligations together with a statement as to the amount of the
Surety L/C Reimbursement Obligations and the per diem interest amount due
thereon.
(b) Disbursements Upon Reduction of Surety L/C Stated Amounts. If at
any time (i) the Stated Amount of the Surety L/C is reduced in the manner
provided for below, (ii) no Surety L/C Reimbursement Obligations exist and all
accrued interest thereon and amounts owed hereunder have been paid in full,
(iii) no Default or Event of Default has occurred and is continuing and the
Credit Obligations have not been accelerated and are not then due and payable in
full, and (iv) as of the date of such reduction in the Surety L/C the Sinking
Fund Collateral Account Value is greater than zero, then the Collateral Agent
shall withdraw from the Sinking Fund Collateral Account and disburse to the
Agent for the purpose of being turned-over to the Borrower as provided in the
Credit Agreement, an amount equal to the lesser of: (A) the Sinking Fund
Collateral Account Value, or (B) an amount equal to the amount by which the
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Stated Amount of the Surety L/C has been reduced. The Stated Amount of Surety
L/C shall be considered reduced for purposes of this agreement only if the
Stated Amount of the Surety L/C has been reduced to the extent and as approved
and consented to by the Bonding Company in writing satisfactory to Agent and the
Surety L/C Issuer has been released from any obligations or claims with respect
to the reduced amount.
(c) Disbursements Upon Expiration/Termination of Surety L/C Amounts.
If at any time (A) the Surety L/C expires pursuant to its terms or is terminated
by the Bonding Company as provided below, (B) all Surety L/C Reimbursement
Obligations, all accrued interest thereon and all other amounts owed by the
Borrower under the Credit Agreement have been paid in full, and (C) no Default
or Event of Default has occurred and is continuing and the Credit Obligations
have not been accelerated and are not then due and payable in full, then the
Collateral Agent shall withdraw the funds in the Sinking Fund Collateral Account
and disburse such funds to the Agent for the purpose of being turned-over to the
Borrower as provided in the Credit Agreement.
(d) Disbursements Upon Joint Instructions. In addition to the other
withdrawals and disbursements permitted or required under this Section 2, the
Collateral Agent will disburse funds held in the Sinking Fund Collateral Account
at any time and from time to time in accordance with the joint written
directions of the Borrower and the Agent or the Lender.
(e) Procedures for Disbursement. Disbursements of the Sinking Fund
Collateral Account Funds in accordance with the provisions of this Section 2
shall be made in same day available funds by the Collateral Agent in Dollars.
Notwithstanding anything to the contrary contained herein or in the Credit
Documents, in no event shall the amount withdrawn from the Sinking Fund
Collateral Account and disbursed in accordance with this Section 2 plus the
aggregate original amount of all Term Loans exceed $32,140,113.50.
2.1 Events of Default. Notwithstanding anything to the contrary herein or
in any other Credit Document, upon the occurrence and during the continuance of
an Event of Default that has been declared by the Agent or the Required Lenders,
the Collateral Agent may (in addition to any other rights or remedies under this
Agreement, the Credit Agreement, at law or otherwise) retain for its own account
(and in accordance with the terms of this Agreement and the Credit Agreement for
the account of the other Lenders) or otherwise sell or dispose of all or any
portion of the Sinking Fund Collateral Account Funds in one or more public or
private sales, and, in each case, apply such Sinking Fund Collateral Account
Funds or the proceeds therefrom in accordance with the terms of the Credit
Agreement.
3. Sinking Fund Collateral Account Security Interest. As security for the
prompt and complete payment and performance of the Credit Obligations (whether
at stated maturity, by acceleration or otherwise), the Borrower hereby pledges,
grants and assigns to the Collateral Agent, for the benefit of the Lenders
(including the Lenders' interests as participants in the Letters of Credit), and
the Letters of Credit Issuer, equal in priority and ratably, a continuing
possessory lien and security interest in, all right, title and interest in, to
and under, the Sinking Fund Collateral Account and the monies or other
collateral contained in the Sinking Fund Collateral Account, together with any
proceeds derived from any of the foregoing, whether now or hereafter existing
(collectively, the "Sinking Fund Collateral Account Funds"). Without limiting
the foregoing, the definition of the Sinking Fund Collateral Account Funds shall
also include the following:
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(a) All amounts now or hereafter on deposit in the Sinking Fund
Collateral Account;
(b) All Investments (as defined in the UCC) and all other amounts
earned on amounts deposited in the Sinking Fund Collateral Account or on
Investments or Sinking Fund Permitted Investments held in the name of the
Borrower for deposit into the Sinking Fund Collateral Account;
(c) All additions to, extensions, renewals and replacements of,
increases in, interest, dividends, distributions and other income and payments
on account of and proceeds of any release, surrender, discharge, assignment,
sale, exchange, transfer, conversion or other disposition or collection of the
Sinking Fund Collateral Account (collectively referred to as the "Proceeds");
and
(d) All certificates of deposit, instruments, passbooks and other
records evidencing the Sinking Fund Collateral Account and Proceeds.
The Borrower acknowledges and agrees that the definition of "Sinking Fund
Collateral Account" hereunder shall be deemed to include within its scope all
personal property included within the definition of "Deposit Accounts" as
defined in the UCC, it being the intention of the Borrower, that such property
of Borrower be included in the foregoing description of "Sinking Fund Collateral
Account".
4. Transfer and Control of Sinking Fund Collateral Account.
(a) Except as permitted hereunder, the Borrower shall not sell,
transfer, encumber, hypothecate or otherwise dispose of, or grant any option
with respect to any portion of the Sinking Fund Collateral Account Funds, or
create or permit to exist any lien, security interest, or other charge or
encumbrance upon any of the Sinking Fund Collateral Account Funds, except for
the pledge and security interest granted under this Agreement.
(b) In the event that the Agent and the Collateral Agent consent to
the transfer of the Sinking Fund Collateral Account to another qualified
financial institution (with any such qualification to be determined by the
Agent), it shall be a condition precedent to any such transfer of the Sinking
Fund Collateral Account, that the Borrower deliver to the Collateral Agent, and
cause any qualified financial institutions to which the Sinking Fund Collateral
Account is to be maintained, to execute and deliver to the Collateral Agent, an
agreement, in form and substance acceptable to the Collateral Agent, among
Borrower, the Collateral Agent and such qualified financial institution for the
purpose of perfecting any security interest granted to the Collateral Agent by
Borrower herein.
5. Investment of Funds.
(a) Except as otherwise expressly provided herein: (i) no Default or
Event of Default exists and is continuing, the Collateral Agent shall invest and
reinvest the Sinking Fund Collateral Account Funds held in the Sinking Fund
Collateral Account as the Borrower shall direct in writing or pursuant to
telephone instruction confirmed promptly in writing; provided,
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however, that no investment or reinvestment may be made unless it is a Sinking
Fund Permitted Investment.
(b) Each Sinking Fund Permitted Investment shall be made in the name
of the Borrower.
(c) If the Collateral Agent has not received investment direction from
the Borrower at any time at which an investment decision must be made with any
of the Sinking Fund Collateral Account Funds, the Collateral Agent shall invest
such funds, or such portion thereof as to which no direction has been received,
in such Sinking Fund Permitted Investments as the Collateral Agent may determine
are appropriate.
(d) Notwithstanding anything to the contrary contained herein, the
Collateral Agent shall, without notice to the Borrower, sell or liquidate any of
the investments of the Sinking Fund Collateral Account Funds at any time, in
accordance with standard commercial practices, if the proceeds thereof are
required for any disbursement of funds permitted or required hereunder, and the
Collateral Agent shall not be liable or responsible for any loss, expense or
penalty resulting from any such sale or liquidation effected in accordance with
such practices.
6. Collateral Agent's Duties and Liabilities.
(a) Other than the exercise of reasonably prudent care to assure the
safe custody of the Sinking Fund Collateral Account Funds while held hereunder,
the Collateral Agent shall have no duty or liability to preserve rights
pertaining thereto and shall be relieved of all responsibility for the Sinking
Fund Collateral Account Funds upon disbursement of the Sinking Fund Collateral
Account Funds in accordance with Section 2 above. The Collateral Agent shall be
deemed to have exercised reasonably prudent care in the custody and preservation
of the Sinking Fund Collateral Account Funds in its possession if the Sinking
Fund Collateral Account Funds are accorded treatment substantially equal to that
which the Collateral Agent accords its own property. Without limiting the
generality of the foregoing, neither the Collateral Agent nor any of its
respective directors, officers, agents or employees shall be liable for: (i) any
failure to invest or reinvest any cash in the Sinking Fund Collateral Account in
the absence of its or their own gross negligence or willful misconduct or for
any losses incurred by reason of Sinking Fund Permitted Investments or
Investments made in accordance with the terms hereof, or (ii) any action taken
or omitted to be taken by the Collateral Agent in accordance with any
instructions or other notice which the Collateral believes in good faith to be
properly given by the Agent and the Borrower hereunder.
(b) Furthermore, the acceptance by the Collateral Agent of its duties
hereunder is subject to the following terms and conditions which the parties to
this Agreement hereby agree shall govern and control with respect to its rights,
duties, liabilities and immunities:
(i) it shall act hereunder as an agent only and shall not be
responsible or liable in any manner whatsoever for soliciting any funds or for
the sufficiency, correctness, genuineness or validity of any funds, securities
or other amounts deposited with it;
(ii) it shall be protected in acting or refraining from acting
upon any
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written notice, certificate, instruction, request or other paper or document, as
to the due execution thereof and the validity and effectiveness of the
provisions thereof and as to the truth of any information therein contained,
which the Collateral Agent in good faith believes to be genuine;
(iii) it shall not be liable for any error of judgment or for any
act done or step taken or omitted, including, without limitation, acts,
omissions, errors or mistakes with respect to the Sinking Fund Collateral
Account or the Sinking Fund Collateral Account Funds, except in the case of its
gross negligence, willful misconduct or bad faith;
(iv) it may consult with and obtain advice from counsel of its
own choice in the event of any dispute or question as to the construction of any
provision hereof or otherwise in connection with its duties as Collateral Agent
hereunder, and any action taken or omitted by the Collateral Agent in reasonable
reliance upon such opinion shall be full justification and protection to it;
(v) it may execute or perform any duties hereunder either
directly or through agents or attorneys; and
(vi) it may engage or be interested in any financial or other
transactions with any party hereto and may act on, or as depositary, trustee or
agent for, any committee or body of holders of obligations of such Persons as
freely as if it were not Collateral Agent hereunder.
(c) The Collateral Agent shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond or
other paper or document, unless requested in writing to do so by the Agent;
provided, however, that if the payment within a reasonable time to the
Collateral Agent of the costs, expenses or liabilities likely to be incurred by
it in the making of such investigation is, in the opinion of the Collateral
Agent, not reasonably assured to the Collateral Agent by the security afforded
to it by the terms of this Agreement, the Collateral Agent may require
reasonable indemnity against such expense or liability as a condition to taking
any such action. The reasonable expense of every such examination shall be paid
by the Borrower or, if paid by the Collateral Agent, shall be repaid by the
Borrower upon demand.
(d) The Collateral Agent shall be under no obligation to take any
steps necessary to preserve rights in the Sinking Fund Collateral Account or the
Sinking Fund Collateral Account Funds against any other parties but may do so at
its option. All expenses incurred in connection therewith shall be for the sole
account of the Borrower, and shall constitute part of the Credit Obligations
secured hereby.
7. Covenants and Warranties of The Borrower. The Borrower warrants to and
covenants and agrees with the Collateral Agent as follows:
(a) It shall perform such acts and execute, acknowledge and deliver,
from time to time, such financing statements and other instruments as may be
reasonably required by the Collateral Agent to perfect or better assure this
Agreement and the security interests created hereby, and file or record the same
in the public records specified by the Collateral Agent and (ii) upon request of
the Collateral Agent, execute and deliver all further instruments and documents,
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and take all further action, that may be necessary or desirable in the
Collateral Agent's reasonable opinion to further perfect and protect any
security interest granted or purported to be granted hereby, to enable the
Collateral Agent to exercise and enforce its rights and remedies hereunder with
respect to the Sinking Fund Collateral Account Funds or to effectuate the
purpose and intent of this Agreement.
(b) It shall irrevocably constitute and appoint the Collateral Agent
and all Persons designated by the Collateral Agent for that purpose its true and
lawful attorney-in-fact with full irrevocable power and authority in the place
and stead of the Borrower and in the name of the Borrower in its own name (i) to
receive payment of and to endorse the Borrower's name to any of the Sinking Fund
Collateral Account Funds (including checks, drafts or other orders for the
payment of money) that come into the Collateral Agent's possession (whether
directly or by delivery of the Agent) or under the Collateral Agent's control
(whether directly or by delivery of the Agent)(including any amounts in the
Sinking Fund Collateral Account), (ii) to make all demands, consents and
waivers, or take any other action with respect to, the Sinking Fund Collateral
Account Funds, (iii) to make all withdrawals from the Sinking Fund Collateral
Account, (iv) to otherwise act with respect thereto and in accordance with the
terms hereof, as though it were the outright owner of the Sinking Fund
Collateral Account Funds, and (v) in its discretion to file any claim or take
any other action or proceedings, either in its own name or in the name of the
Borrower or otherwise, which the Collateral Agent may deem necessary or
appropriate to protect and preserve the right, title and interest of the
Collateral Agent in and to the Sinking Fund Collateral Account Funds and the
security intended to be afforded hereby. The appointment of the Collateral Agent
as the Borrower's attorney-in-fact and the Collateral Agent's rights and powers
are coupled with an interest and are irrevocable until all Credit Obligations
owed to such Collateral Agent shall have been paid in full and Letters of Credit
terminated as discussed above.
(c) Unless terminated in accordance with Section 10 below, until the
payment in full of all of the Credit Obligations and the termination of all
Letters of Credit in accordance with the terms of the Credit Agreement, the
Borrower shall grant to Collateral Agent the right, to the exclusion of the
Borrower, to (i) make all demands, consents and waivers, or take any other
action with respect to, the Sinking Fund Collateral Account Funds, (ii) accept
the payment of any interest, principal or other amounts payable under or in
connection with the Sinking Fund Collateral Account Funds, (iii) commence any
actions to enforce the Sinking Fund Collateral Account Funds, (iv) make all
withdrawals from the Sinking Fund Collateral Account, and (v) otherwise act with
respect to the Sinking Fund Collateral Account Funds as though it were the
outright owner thereof.
(d) The principal place of business of the Borrower is located at 0000
Xxxxx 00, Xxxxx Xxxxxx, Xxx Xxxx, and the chief executive offices of the
Borrower are located at 0000 Xxxxxx Xxxx, Xxxxxx, Xxx Xxxx. If the Borrower
expects to the change either of the above-referenced locations, the Borrower
hereby agrees that it shall provide the Collateral Agent thirty (30) days' prior
written notice of any expected change.
8. Indemnification. From and at all times after the date of this Agreement,
and in addition to the fees, costs and expenses payable under Sections 6 and 9,
the Borrower agrees to indemnify and hold harmless the Collateral Agent and each
of its directors, officers, employees, agents and Affiliates (each, an
"Indemnified Person") against any and all claims, losses, damages, liabilities,
costs and expenses of any kind or nature whatsoever, including, without
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limitation, reasonable attorneys' fees and expenses (collectively, "Indemnified
Costs"), incurred by or asserted against any such Indemnified Person from and
after the date hereof, whether direct, indirect or consequential, as a result of
or arising from or in any way relating to any action, suit or proceeding
(including any inquiry or investigation) by any Person, whether threatened or
initiated, arising from or in connection with the negotiation, preparation,
execution, performance or enforcement of this Agreement or any of the
transactions contemplated herein, in any case where such Indemnified Person is a
party to any such action, suit or proceeding or a subject of any such inquiry or
investigation if such Indemnified Person reasonably determines that it may
become a party to any such action; provided, however, that no Indemnified Person
shall have the right to be indemnified hereunder for any Indemnified Costs to
the extent resulting from the gross negligence or willful misconduct of such
Indemnified Person as finally determined by a court of competent jurisdiction
and not subject to any appeal. If any such action or claim shall be brought or
asserted against any Indemnified Party, such Indemnified Party shall promptly
notify the Borrower in writing, and the Borrower shall assume the defense
thereof, including the employment of counsel and the payment of all expenses.
Such Indemnified Party shall, in its sole discretion, have the right to employ
separate counsel (who may be selected by such Indemnified Party in its sole
discretion) in any such action and to participate in the defense thereof, and
the fees and expenses of such counsel shall be paid by such Indemnified Party
unless: (a) the Borrower agrees to pay such fees and expenses, (b) the Borrower
shall fail to assume the defense of such action or proceeding or shall fail, in
the reasonable discretion of such Indemnified Party, to employ counsel
satisfactory to the Indemnified Party in any such action or proceeding, or (c)
the named parties to any such action or proceeding (including any impleaded
parties) include both such Indemnified Party and the Borrower or any other
Indemnified Party, and such Indemnified Party shall have been advised by counsel
that there may be one or more non-frivolous legal defenses available to it that
are different from or additional to those available to the Borrower or such
other Indemnified Party. All of the foregoing Indemnified Costs of any
Indemnified Person shall be paid or reimbursed by the Borrower as and when
incurred and upon demand.
9. Fees and Expenses of Collateral Agent. The Borrower will pay the
Collateral Agent for all reasonable out-of-pocket costs and expenses incurred by
the Collateral Agent in connection with any Sinking Fund Permitted Investment or
otherwise in administering the Sinking Fund Collateral Account.
10. Termination of Pledge. This Agreement shall terminate, and the
Collateral Agent shall forthwith disburse all funds held in the Sinking Fund
Collateral Account to the Borrower in accordance with Section 3.2 (e) of the
Credit Agreement; provided, however, that the provisions of Sections 6, 8 and 9
shall survive such termination.
11. Disbursement Into Court. If, at any time, there shall exist any dispute
between the Borrower and the Collateral Agent with respect to the holding or
disposition of any portion of the Sinking Fund Collateral Account Funds held in
the Sinking Fund Collateral Account or any other obligations of the Collateral
Agent hereunder, or if at any time the Collateral Agent is unable to determine,
to its sole satisfaction, the proper disposition of any portion of such funds or
Collateral Agent's proper actions with respect to its obligations hereunder,
then the Collateral Agent may, in its sole discretion, take either or both of
the following actions:
(a) suspend the performance of any of its obligations under this
Agreement until such dispute or uncertainty shall be resolved to the sole
satisfaction of the Collateral Agent;
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provided, however, that the Collateral Agent may continue to invest the Sinking
Fund Collateral Account Funds in accordance with Section 5; and/or
(b) petition (by means of an interpleader action or any other
appropriate method) any court of competent jurisdiction in Monroe County, New
York, for instructions with respect to such dispute or uncertainty, and pay into
such court all or part of the Sinking Fund Collateral Account Funds for holding
and disposition in accordance with the instructions of such court.
The Collateral Agent shall have no liability to the Borrower or any other Person
with respect to any such suspension of performance or disbursement into court,
specifically including any liability or claimed liability that may arise, or be
alleged to have arisen, out of or as a result of any delay in the disbursement
of the Sinking Fund Collateral Account Funds or any delay in or with respect to
any other action required or requested of the Collateral Agent.
12. Tax Reporting. The Collateral Agent will provide to the Borrower a
statement of investment income and such other statements with respect to the
Sinking Fund Collateral Account as the Borrower may reasonably request from time
to time. The Borrower shall be responsible for all tax reporting with respect to
the Sinking Fund Collateral Account and the income therefrom.
13. Notices. All notices and other communications provided for hereunder
shall be in writing (including telegraphic, telex, facsimile transmission or
cable communication) and mailed, telegraphed, telexed, telecopied, cabled or
delivered to the party to be notified at the following addresses:
The Borrower: American Rock Salt Company LLC
(if by FedEx) 0000 Xxxxx 00
Xxxxx Xxxxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxxx, Chief Financial Officer
Telecopy: (000) 000-0000
(if by mail) X.X. Xxx 000
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxxx, CFO
with a copy to: Xxxxxx Beach LLP
00 Xxxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx Xxxxx, Esq.
Telecopy: (000) 000-0000
The Collateral Agent: Manufacturers and Traders Trust Company
000 Xxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxx, Vice President
Telecopy: (000) 000-0000
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with a copy to: Xxxxx Xxxxxx Xxxxxx, XXX
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Forth, Esq.
Telecopy: (000) 000-0000
or to such other address as any party may designate for itself by like notice to
all other parties hereto. All such notices and communications shall be deemed to
have been given: (a) if mailed as provided above by any method other than
overnight delivery service, on the fifth (5th) Business Day after deposit in the
mail, (b) if mailed by overnight delivery service, telegraphed, telexed or
telecopied, when delivered for overnight delivery, delivered to the telegraph
company, confirmed by telex answerback or transmitted by telecopier,
respectively, or (c) if delivered by hand, upon delivery.
14. Security Interest Absolute. The security interest, rights of the
Collateral Agent and obligations of the Borrower granted or created under this
Agreement shall be absolute and unconditional irrespective of:
(a) Any lack of validity or enforceability in whole or in part of this
Agreement, the Credit Agreement, any other Credit Document, or any other
agreement or instrument executed or delivered in connection herewith or
therewith;
(b) Any change in the time, manner or place of payment of, or in any
other term of, the Credit Agreement, any other Credit Document, or any other
amendment or waiver of, or any consent to any departure from, such agreement or
any other instrument executed or delivered in connection herewith or therewith;
(c) Any exchange, release or non-perfection of any other Collateral,
or any release, amendment or waiver of, or consent to departure from, any
guaranty, for all or any of the Indebtedness;
(d) Any other circumstance which might otherwise constitute a defense
available to, or a discharge of the Borrower in respect of, any Indebtedness; or
(e) Any name change or merger, consolidation or other business
combination (including the Merger) involving or with respect to the Borrower.
15. Amendments, Waivers, etc. No amendment, modification, waiver, discharge
or termination of, or consent to any departure by any party hereto from, any
provision of this Agreement, shall be effective unless in a writing signed by
the Agent (and, in the event the same shall affect the rights or obligations of
the Collateral Agent under Sections 6, 8 or 9) and the Borrower, and then the
same shall be effective only in the specific instance and for the specific
purpose for which given.
16. Governing Law; Consent to Jurisdiction; Venue. This Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
York. With respect to any matters that may be heard before a court of competent
jurisdiction, the parties hereto each consent to the jurisdiction and venue of
the courts of Monroe County or Xxxxxxxxxx County, New
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York or of any federal court located in the Western District of New York, waive
personal service of any and all process upon it and consent that all such
service of process be made by certified or registered mail directed to the
affected party at the address provided in Section 13 above and service so made
shall be deemed to be completed upon actual receipt. The parties hereto each
waive the right to contest to the jurisdiction and venue of the courts located
in Monroe County or Xxxxxxxxxx County, New York or of any federal court located
in the Western District of New York on the ground of inconvenience or otherwise,
and further, waive the right to bring any action or proceeding against the other
parties hereto in any court outside Monroe County or Xxxxxxxxxx County, New York
or, for applicable federal actions, outside the Western District of New York.
17. Waiver of Jury Trial. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY
WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION (a) ARISING UNDER THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, ANY
PRESENT OR FUTURE MODIFICATION THEREOF, OR (b) IN ANY WAY CONNECTED WITH OR
RELATED TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO
THIS AGREEMENT (AS NOW OR HEREAFTER MODIFIED) OR ANY OTHER INSTRUMENT, DOCUMENT
OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS
RELATED HERETO OR THERETO, IN EACH CASE WHETHER SUCH CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION IS NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN
CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT
ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT
TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENT OF THE PARTIES HERETO TO THE WAIVER OF ANY RIGHT THEY MIGHT OTHERWISE
HAVE TO TRIAL BY JURY.
18. Waiver of Damages. EXCEPT AS PROHIBITED BY LAW, EACH PARTY TO THIS
AGREEMENT WAIVES ANY RIGHTS IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION,
ANY SPECIAL, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES OR ANY DAMAGES OTHER
THAN, OR IN ADDITION TO, ACTUAL DAMAGES. EACH PARTY TO THIS AGREEMENT (i)
CERTIFIES THAT NEITHER THE COLLATERAL AGENT NOR ANY REPRESENTATIVE, OR ATTORNEY
OF THE COLLATERAL AGENT NOR ANY LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT THE COLLATERAL AGENT OR SUCH LENDER WOULD NOT, IN THE EVENT OF LITIGATION,
SEEK TO ENFORCE THE FOREGOING WAIVERS, AND (ii) ACKNOWLEDGES THAT IT HAS BEEN
INDUCED TO ENTER INTO THIS AGREEMENT AND EACH OTHER CREDIT DOCUMENT BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS AGREEMENT, INCLUDING
BUT NOT LIMITED TO THE WAIVERS IN SECTIONS 16, 17 AND 18. THE PROVISIONS OF THIS
AGREEMENT, INCLUDING BUT NOT LIMITED TO THE PROVISIONS IN SECTIONS 16, 17 AND
18, HAVE BEEN FULLY DISCLOSED TO THE PARTIES AND THE PROVISIONS OF THIS
AGREEMENT, INCLUDING BUT NOT LIMITED TO THE PROVISIONS IN XXXXXXXX 00, 00 XXX
00, XXXXX XX SUBJECT TO NO EXCEPTIONS. NO PARTY HAS IN ANY WAY AGREED WITH OR
REPRESENTED TO ANY OTHER PARTY THAT THE PROVISIONS OF THIS AGREEMENTS AND
SPECIFICALLY SECTIONS 16, 17 AND 18, WILL NOT BE FULLY ENFORCED IN ALL
INSTANCES.
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19. Severability. To the extent any provision of this Agreement is
prohibited by or invalid under the applicable law of any jurisdiction, such
provision shall be ineffective only to the extent of such prohibition or
invalidity and only in any such jurisdiction, without prohibiting or
invalidating such provision in any other jurisdiction or the remaining
provisions of this Agreement in any jurisdiction.
20. Construction. The headings of the various sections and subsections of
this Agreement have been inserted for convenience only and shall not in any way
affect the meaning or construction of any of the provisions hereof. Unless the
context otherwise requires, words in the singular include the plural and words
in the plural include the singular.
21. Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto on separate counterparts, each of
which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.
22. Entire Agreement. This Agreement and the other documents and
instruments executed contemporaneously herewith constitute the entire agreement
between the parties hereto relating to the subject matter hereof.
23. Successors and Assigns. The provisions of this Agreement shall be
binding upon, inure to the benefit of and be enforceable by the respective
successors and assigns of the Borrower, and the Collateral Agent.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized corporate officers as of the date first above
written.
AMERICAN ROCK SALT COMPANY LLC
By: /s/ Xxxx X. Xxxxx
---------------------------
Name: Xxxx X. Xxxxx
Title: Vice Chairman
MANUFACTURERS AND TRADERS TRUST
COMPANY, as Collateral Agent
By: /s/ Xxx X. Xxxxx
---------------------------
Name: Xxx X. Xxxxx
Title: Vice President
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