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Exhibit 4.6
LC ACCOUNT AGREEMENT
THIS LC ACCOUNT AGREEMENT (this "Agreement") is dated as of November
13, 2000, and made by and among THE WACKENHUT CORPORATION, a Florida
corporation, (the "Pledgor"), and BANK OF AMERICA, N.A., as the agent for the
Lenders party to that certain Credit Agreement (as defined below) (in such
capacity herein and together with any successors in such capacity, the "Agent").
RECITALS
WHEREAS, the Pledgor, the Lenders party thereto from time to time (the
"Lenders") and the Agent have entered into a Credit Agreement dated as of the
date hereof (said Credit Agreement as it may hereafter be amended, amended and
restated, supplemented or otherwise modified from time to time in accordance
with the terms thereof and in effect, hereinafter referred to as the "Credit
Agreement");
WHEREAS, as a condition precedent to the Lenders' obligations to make
the Loans or of the Issuing Banks to issue Letters of Credit, the Pledgor is
required to execute and deliver to the Agent a copy of this Agreement on or
before the Closing Date;
NOW, THEREFORE, in consideration of the foregoing and the agreements,
provisions and covenants contained herein, the Pledgor and the Agent hereby
agree as follows:
Section 1. Capitalized terms used in this Agreement shall have the
following meanings:
"COLLATERAL" means (a) all funds from time to time on deposit in the LC
Account; (b) all Investments and all certificates and instruments from time to
time representing or evidencing such Investments; (c) all notes, certificates of
deposit, checks and other instruments from time to time hereafter delivered to
or otherwise possessed by the Agent for or on behalf of the Pledgor in
substitution for or in addition to any or all of the Collateral described in
clause (a) or (b) above; (d) all interest, dividends, cash, instruments and
other property from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of the Collateral described in
clause (a), (b) or (c) above; and (e) to the extent not covered by clauses (a)
through (d) above, all proceeds of any or all of the foregoing Collateral.
"INVESTMENTS" means those investments, if any, made by the Agent
pursuant to Section 5 hereof.
"LC ACCOUNT" means the cash collateral account established and
maintained pursuant to Section 2 hereof.
"SECURED OBLIGATIONS" means (i) all obligations of the Pledgor now
existing or hereafter arising under or in respect of the Credit Agreement or the
Notes (including, without limitation, the Pledgor's obligations to pay principal
and interest and all other charges, fees, expenses, commissions, reimbursements,
indemnities and other payments related to or in respect of the
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obligations contained in the Credit Agreement or the Notes) or any documents or
agreement related to the Credit Agreement or the Notes; and (ii) without
duplication, all obligations of the Pledgor now or hereafter existing under or
in respect of this Agreement, including, without limitation, all charges, fees,
expenses, commissions, reimbursements, indemnities and other payments related to
or in respect of the obligations contained in this Agreement.
Capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Credit Agreement.
Section 2. LC ACCOUNT; CASH COLLATERALIZATION OF LETTERS OF CREDIT.
(i) At the time of delivery of any amounts hereunder, the
Agent shall establish and maintain at its offices at 000 Xxxxx Xxxxx
Xxxxxx, XXX-000-00-00, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, in the name of
the Agent and under the sole dominion, discretion and control of the
Agent, a cash collateral account designated as Bank of America/The
Wackenhut Corporation Cash LC Account (the "LC Account").
(ii) In accordance with Article X of the Credit Agreement, in
the event that an Event of Default has occurred and is continuing and
the Pledgor is required to pay to the Agent an amount equal to the
maximum amount remaining drawn or unpaid under the Letters of Credit,
the Agent shall, upon receipt of any such amounts, exercise the
remedies set forth in Section 12 hereof and shall apply the proceeds as
provided in Article X of the Credit Agreement. Any such amounts
received by the Agent pursuant to Section 10.1(B) of the Credit
Agreement shall be deposited in the LC Account. Upon a drawing under
the Letters of Credit in respect of which any amounts described above
have been deposited in the LC Account, the Agent shall apply such
amounts to reimburse the Issuing Banks, ratably for the amount of such
drawing. In the event the Letters of Credit are canceled or expire or
in the event of any reduction in the maximum amount available at any
time for drawing under such Letters of Credit (the "Maximum Available
Amount"), the Agent shall apply the amount then in the LC Account
designated to reimburse the applicable Issuing Banks for any drawings
under the Letters of Credit less the Maximum Available Amount
immediately after such cancellation, expiration or reduction, if any,
FIRST, to the cash collateralization of the Letters of Credit if the
Pledgor failed to pay all or a portion of the maximum amounts described
above and, SECOND, to the payment in full of the outstanding Secured
Obligations.
(iii) Interest received in respect of Investments made by the
Pledgor of any amounts deposited in the LC Account pursuant to clause
(ii) of this Section 2 shall be delivered by the Agent to the Pledgor
on the last Business Day of each calendar month or, if earlier, upon
cancellation or expiration of or drawing of the Maximum Available
Amount for drawing under the Letters of Credit, as the case may be, in
respect of which such amounts were so deposited; PROVIDED, HOWEVER,
that the Agent shall not deliver to the Pledgor any such interest
received in respect of Investments of any amounts deposited in the LC
Account pursuant to this Section 2 if an Event of Default has occurred
and is continuing or unless all outstanding Secured Obligations have
been indefeasibly paid in full in cash.
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The Pledgor shall have no obligation to deposit funds into the LC
Account except upon the occurrence of an Event of Default as provided in this
Section 2.
Section 3. PLEDGE; SECURITY FOR SECURED OBLIGATIONS. The Pledgor hereby
absolutely and unconditionally pledges to the Agent (for itself and on behalf of
the Lenders and Issuing Banks) a first priority lien and security interest in,
the Collateral, as collateral security for the prompt payment in full when due,
whether at stated maturity, by acceleration or otherwise (including, without
limitation, the payment of interest and other amounts which would accrue and
become due but for the filing of a petition in bankruptcy or the operation of
the automatic stay under Section 362(a) of the Bankruptcy Code), of all Secured
Obligations.
Section 4. DELIVERY OF COLLATERAL. All certificates or instruments, if
any, representing or evidencing the Collateral shall be delivered to and held by
the Agent pursuant hereto and shall be in suitable form for transfer by
delivery, or shall be accompanied by duly executed instruments of transfer or
assignment in blank, all in form and substance reasonably satisfactory to the
Agent. In the event any Collateral is not evidenced by a certificate reflecting
title in the name of the Agent or a filing evidencing the security interest of
the Agent, a notation shall be made in the records of the issuer of such
Collateral or in such other appropriate records as the Agent may require, all in
form and substance reasonably satisfactory to the Agent. The Agent shall have
the right, at any time and without notice to the Pledgor, to transfer to or to
register in the name of the Agent or any of its nominees any or all of the
Collateral. In addition, the Agent shall have the right at any time to exchange
certificates or instruments representing or evidencing Collateral for
certificates or instruments of smaller or larger denominations.
Section 5. INVESTING OF AMOUNTS IN THE LC ACCOUNT; AMOUNTS HELD BY THE
AGENT. Cash held by the Agent in the LC Account shall not be invested or
reinvested except as provided in this Section 5.
(i) Except as otherwise provided in Section 12 hereof, any
funds on deposit in the LC Account shall be invested by the Agent so
long as no Default or Event of Default shall have occurred and be
continuing, in cash equivalents.
(ii) The Agent is hereby authorized to sell, and shall sell,
all or any designated part of the Collateral (A) so long as no Default
or Event of Default shall have occurred and be continuing, upon the
receipt of appropriate written instructions from the Pledgor or (B) in
any event if such sale is necessary to permit the Agent to perform its
duties hereunder or under the Credit Agreement. The Agent shall have no
responsibility for any loss in the value of the Collateral resulting
from a fluctuation in interest rates or otherwise. Any interest on
securities constituting part of the Collateral and the net proceeds of
the sale or payment of any such securities shall be held in the LC
Account by the Agent.
Section 6. REPRESENTATIONS AND WARRANTIES. In addition to its
representations and warranties made pursuant to Article VIII of the Credit
Agreement, the Pledgor represents and warrants to the Agent (for itself and as
agent on behalf of the Lenders and Issuing Banks), that the following statements
are true, correct and complete:
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(i) The Pledgor will be the legal and beneficial owner of the
Collateral free and clear of any Lien except for the lien and security
interest created by this Agreement;
(ii) The pledge and assignment of the Collateral pursuant to
this Agreement creates a valid and perfected first priority security
interest in the Collateral, securing the payment of the Secured
Obligations.
Section 7. FURTHER ASSURANCES. The Pledgor agrees that at any time and
from time to time, at its expense, it will promptly execute and deliver to the
Agent any further instruments and documents, and take any further actions, that
may be necessary or that the Agent may reasonably request, in order to perfect
and protect any security interest granted or purported to be granted hereby or
to enable the Agent to exercise and enforce its rights and remedies hereunder
with respect to any Collateral.
Section 8. TRANSFERS AND OTHER LIENS. The Pledgor agrees that it will
not (a) sell or otherwise dispose of any of the Collateral, or (b) create or
permit to exist any Lien upon or with respect to any of the Collateral, except
for the lien and security interest created by this Agreement.
Section 9. THE AGENT APPOINTED ATTORNEY-IN-FACT. The Pledgor hereby
appoints the Agent as its attorney-in-fact, with full authority in the place and
stead of the Pledgor and in the name of the Pledgor or otherwise, from time to
time in the Agent's reasonable discretion to take any action and to execute any
instrument which the Agent may reasonably 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 Pledgor
representing any payment, dividend, or other distribution in respect of the
Collateral or any part thereof and to give full discharge for the same. In
performing its functions and duties under this Agreement, the Agent shall act
solely for itself and as the agent of the Lenders and Issuing Banks, and the
Agent has not assumed nor shall be deemed to have assumed any obligation towards
or relationship of agency or trust with or for the Pledgor.
Section 10. THE AGENT MAY PERFORM. If the Pledgor fails to perform any
agreement contained herein, after notice to the Pledgor, the Agent may itself
perform, or cause performance of, such agreement, and the expenses of the Agent
incurred in connection therewith shall be payable by the Pledgor under Section
13 hereof.
Section 11. STANDARD OF CARE; NO RESPONSIBILITY FOR CERTAIN MATTERS. In
dealing with the Collateral in its possession, the Agent shall exercise the same
care which it would exercise in dealing with its own property of a similar
nature, but it shall not be responsible for (a) ascertaining or taking action
with respect to calls, conversions, exchanges, maturities, tenders or other
matters relative to any Collateral, whether or not the Agent has or is deemed to
have knowledge of such matters, (b) taking any steps to preserve rights against
any parties with respect to any Collateral (other than steps taken in accordance
with the standard of care set forth above to maintain possession of the
Collateral), (c) the collection of any proceeds, (d) any loss resulting from
Investments made pursuant to Section 5 hereof, or (e) determining (x) the
correctness of any statement or calculation made by the Pledgor in any written
or telex (tested or otherwise) instructions, or (y) whether any deposit in the
LC Account is proper.
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Section 12. REMEDIES UPON DEFAULT; APPLICATION OF PROCEEDS. If any
Event of Default shall have occurred and be continuing:
(i) The Agent may exercise in respect of the Collateral, in
addition to other rights and remedies provided for herein otherwise
available to it, all the rights and remedies of a secured party on
default under the Uniform Commercial Code (the "Code") as in effect at
that time in the State of Florida or in any other State where any
portion of the Collateral may be located, and the Agent may, without
notice except as specified below, sell the Collateral or any part
thereof in one or more parcels at public or private sale, at any
exchange or broker's board or at any of the Agent's offices or
elsewhere, for cash, on credit or for future delivery, and at such
price or prices, and upon such other terms as the Agent may deem
commercially reasonable. The Pledgor agrees that, to the extent notice
of sale shall be required by law, at least ten (10) days' written
notice to the Pledgor of the time and place of any public sale or the
time after which any private sale is to be made shall constitute
reasonable notification. The Agent shall not be obligated to make any
sale of the Collateral regardless of notice of sale having been given.
The Agent may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was
so adjourned.
(ii) Subject to the provisions of Section 2.(ii) hereof, any
cash held by the Agent as Collateral and all cash proceeds received by
the Agent in respect of any sale of, collection from, or other
realization upon all or part of the Collateral shall be applied (after
payment of any amounts payable to the Agent pursuant to Section 13
hereof) by the Agent to pay the Secured Obligations. Any surplus of
such cash or cash proceeds held by the Agent and remaining after
payment in full of all Secured Obligations shall be paid over to the
Pledgor or to whomsoever may be lawfully entitled to receive such
surplus.
Section 13. EXPENSES. In addition to any payments of expenses of Agent
pursuant to the Credit Agreement, the Pledgor agrees to pay promptly to the
Agent all the reasonable costs and expenses which the Agent may incur in
connection with (a) the custody or preservation of, or the sale of, collection
from, or other realization upon, any of the Collateral, (b) the exercise or
enforcement of any of the rights of the Agent hereunder, or (c) the failure by
the Pledgor to perform or observe any of the provisions hereof.
Section 14. NO DELAYS; WAIVER, ETC. No delay or failure on the part of
the Agent in exercising, and no course of dealing with respect to, any power or
right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise by the Agent of any power or right hereunder preclude other or
further exercise thereof or the exercise of any other power or right. The
remedies herein provided are to the fullest extent permitted by law cumulative
and are not exclusive of any remedies provided by law.
Section 15. AMENDMENTS, ETC. No amendment, modification, termination or
waiver of any provision of this Agreement, or consent to any departure by the
Pledgor therefrom, shall in any event be effective without the written
concurrence of the Agent.
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Section 16. NOTICES. Except as otherwise specifically provided herein,
all notices which are to be sent to the Pledgor or Agent shall be given in
accordance with the Credit Agreement.
Section 17. CONTINUING SECURITY INTEREST; TERMINATION. This Agreement
shall create a continuing security interest in the Collateral and shall (a)
remain in full force and effect until all Secured Obligations (other than
Secured Obligations in the nature of continuing indemnities or expense
reimbursement obligations not yet due and payable) shall have been indefeasibly
paid in full in cash, the Revolving Credit Commitments, the Letter of Credit
Commitments or any other obligations of the Agent or any Lender to make any
Loans or of the Issuing Banks to issue any Letters of Credit under the Credit
Agreement shall have expired and the Letters of Credit shall have expired, (b)
be binding upon the Pledgor, its respective successors and assigns, and (c)
inure to the benefit of the Agent, the Lenders, the Issuing Banks and their
respective successors, transferees and assigns. Without limiting the generality
of the foregoing clause (c) and subject to the provisions of the Credit
Agreement, any Lender or Issuing Bank may assign or otherwise transfer any Note
held by it to any other person or entity, and such other person or entity shall
thereupon become vested with all the benefits in respect thereof granted to such
Lender or Issuing Bank herein or otherwise. Upon the indefeasible payment in
full in cash of the Secured Obligations (other than Secured Obligations in the
nature of continuing indemnities or expense reimbursement obligations not yet
due and payable) and the cancellation or expiration of the Letters of Credit and
termination or expiration of all Revolving Credit Commitments, all Letter of
Credit Commitments and any other obligations of the Agent and any Lender to make
any Loan or of the Issuing Banks to issue any Letter of Credit, the Pledgor
shall be entitled to the return, upon its request and at its expense, of such of
the Collateral as shall not have been sold or otherwise applied pursuant to the
terms hereof.
Section 18. GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER, AND FOR ALL PURPOSES SHALL BE
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS AND JUDICIAL DECISIONS OF THE
STATE OF FLORIDA, EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE
SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
FLORIDA. THE PLEDGOR HEREBY SUBMITS TO THE JURISDICTION AND VENUE OF THE STATE
AND FEDERAL COURTS OF FLORIDA FOR THE PURPOSES OF RESOLVING DISPUTES HEREUNDER
OR FOR THE PURPOSES OF COLLECTION. UNLESS OTHERWISE DEFINED HEREIN OR IN THE
CREDIT AGREEMENT, TERMS DEFINED IN ARTICLE 9 OF THE CODE ARE USED HEREIN AS
THEREIN DEFINED.
Section 19. SUCCESSORS AND ASSIGNS. Whenever in this Agreement any of
the parties hereto is referred to, such reference shall be deemed to include the
successors and assigns of such party and all covenants, promises, and agreements
by or on behalf of the Pledgor or by and on behalf of the Agent shall bind and
inure to the benefit of the successors and assigns of the Pledgor, the Agent,
the Lenders and the Issuing Banks.
Section 20. EXECUTION IN COUNTERPARTS. This Agreement may be executed
in any number of counterparts and by the different parties on separate
counterparts and each such counterpart
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shall for all purposes be deemed an original, but all such counterparts shall
together constitute but one and the same Agreement. The Pledgor and the Agent
hereby acknowledge receipt of a true, correct, and complete counterpart of this
Agreement.
Section 21. SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Agreement
or affecting the validity or enforceability of such provision in any other
jurisdiction.
Section 22. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all previous proposals, negotiations, representations, commitments
and other communications between or among the parties, both oral and written,
with respect thereto.
Section 23. HEADINGS. This section headings in this Agreement are
inserted for convenience of reference and shall not be considered a part of this
Agreement or used in its interpretation.
[Remainder of Page Intentionally Left Blank)
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IN WITNESS WHEREOF, the Pledgor and the Agent have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first above written.
THE WACKENHUT CORPORATION
By: /s/ Xxx Xxxxxxx
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Name: Xxx Xxxxxxx
Title: Assistant Treasurer
BANK OF AMERICA, N.A., as Agent
By: /s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx Xxxxxxxxx
Title: Vice President
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