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EXHIBIT 10.5
EXECUTION COPY
LOCKBOX ACCOUNT AGREEMENT
Without Activation
THIS LOCKBOX ACCOUNT AGREEMENT ("Agreement") is made and entered into as of this 28th day of October, 2003, by
and among BANK OF AMERICA, N.A., a National Bank, ("Bank"), X'XXXXXXXX INDUSTRIES, INC., a Delaware corporation
("Company"), and GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation, as agent ("Agent") for the lenders
(collectively, "Lenders") from time to time party to the Credit Agreement described below.
A. Pursuant to that certain Credit Agreement, dated as of September 29, 2003 among Company, the
other credit parties signatory thereto from time to time, Lenders and Agent (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement"), Lenders have agreed to make loans and extend other
financial accommodations to Company.
B. Company has established a post office lockbox address at Bank: X.X. Xxx 00000, Xx. Xxxxx,
Xxxxxxxx 00000-0000 (the "Lockbox" or the "Lockbox Address") through which cash, checks, money orders and other
items of value of Company are processed by Bank for deposit in Account No. 100102132217 established by Company
with Bank (the "Lockbox Account").
C. The parties hereto desire to enter into this Agreement in order to set forth their relative
rights and duties with respect to the Lockbox, Lockbox Account and all funds on deposit therein from time to time.
NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements hereinafter set forth,
the parties hereto agree as follows:
1. Effectiveness. This Agreement shall take effect immediately upon its execution by all parties hereto
and shall supersede any blocked account or similar agreement in effect with respect to the Lockbox or
the Lockbox Account.
2. Security Interest; Agency. As collateral security for Company's obligations to Agent and Lenders under
the Credit Agreement and the other loan documents described therein, Company hereby grants to Agent, for
its own benefit and the ratable benefit of Lenders, a present and continuing security interest in
(a) the Lockbox and the Lockbox Account, (b) all contract rights, claims and privileges in respect of the
Lockbox or the Lockbox Account, and (c) all cash, checks, money orders and other items of value of
Company now or hereafter paid, deposited, credited or held (whether for collection, provisionally or
otherwise) to or in the Lockbox or the Lockbox Account or otherwise in the possession or under the
control of, or in transit to, Bank or any agent, bailee or custodian thereof for deposit in or credit to
the Lockbox or the Lockbox Account (collectively, "Receipts"), and all proceeds of the foregoing.. Bank
acknowledges Agent's security interest in such collateral and that this Agreement constitutes notice of
such security interest and Bank further acknowledges and agrees that is does not and shall not object to
or contest Agent's security interest in such collateral. The parties hereto agree that Bank shall
comply with the instructions originated by Agent directing disposition of the Receipts in the Lockbox
Account, without further consent of the Company.
3. Control of Lockbox Account. The Lockbox, Lockbox Account and any and all funds on deposit from time to
time therein shall be under the sole dominion and control of Agent and neither Company, nor any other
person or entity, through or under the Company, shall have any control over the use of, or any right to
withdraw any amount from the Lockbox or the Lockbox Account. Notwithstanding anything set forth herein
to the contrary, Company covenants to Agent it will not close the Lockbox Account or shall it have any
control over the use of, or any right to withdraw from, the Lockbox Account. Bank shall have no
liability in the event Company breaches this covenant to Agent. A reasonable period of time following
the effective date of this Agreement (which period commences as soon as possible but in no event shall
exceed two Business Days from such effective date), and continuing on each Business Day thereafter, Bank
shall transfer all collected and available balances in the Lockbox Account to Agent at its account (the
"Collection Account") at:
ABA No. 000-000-000
Account Number 000-000-00
Deutsche Bank Trust Company Americas
New York, New York
ACCOUNT NAME: GECC/CAF DEPOSITORY
Reference: GE Capital re X'Xxxxxxxx Industries, Inc. - CFN 5264
A "Business Day" is each day except Saturdays, Sundays and Bank holidays. Funds are not available if,
in the reasonable determination of Bank, they are subject to a hold, dispute or legal process preventing
their withdrawal.
4. Procedures for Lockbox Service. Bank performs the services described in Exhibit A which includes
receiving mail at the Lockbox, processing it and depositing checks and other payment instructions
("Checks") into the Lockbox Account (the "Lockbox Service").
5. Statements and Other Information. On each Business Day, Bank will send any Checks not processed in
accordance with the Lockbox Service set-up documents as well as any other materials, such as invoices,
received at the Lockbox plus information regarding the deposit for the day to the address specified
below for Company, and will send a copy of the deposit advice to the address specified below for Agent.
In addition to the original Bank statement provided to Company, Bank will provide Agent with a duplicate
of such statement together with copies of all notices and statements sent to Company with respect to the
Lockbox and the Lockbox Account.
6. Offset Rights.
(a) Bank agrees not to exercise or claim any right of offset, banker's lien or other like right against the
Lockbox or the Lockbox Account for so long as this Agreement is in effect except with respect
to (i) returned or charged-back items, (ii) reversals or cancellations of payment orders and
other electronic fund transfers, (iii) overdrafts resulting from adjustments or corrections of
previous credits or other postings (together with clauses (i) and (ii), collectively, "Returned
Items") or (iv) Bank's charges, fees and expenses with respect to the Lockbox or the Lockbox
Account or the services provided in connection therewith or hereunder (collectively,
"Charges"); and
(b) Company hereby authorizes Bank, without prior notice, from time to time to debit any other account
Company may have with Bank to the extent not already pledged to Agent for Returned Items and
Charges due Bank under subsection 6(a).
7. Limits of Bank's Liability.
(a) Bank will not be liable to Company or Agent for any expense, claim, loss, damage or cost ("Damages")
arising out of or relating to its performance under this Agreement other than those Damages
which result directly from its acts or omissions constituting negligence or intentional
misconduct.
(b) In no event will Bank be liable for any special, indirect, exemplary or consequential damages, including
but not limited to lost profits.
(c) Bank will be excused from failing to act or delay in acting, and no such failure or delay shall
constitute a breach of this Agreement or otherwise give rise to any liability of Bank, if (i)
such failure or delay is caused by circumstances beyond Bank's reasonable control, including
but not limited to legal constraint, emergency conditions, action or inaction of governmental,
civil or military authority, fire, strike, lockout or other labor dispute, war, riot, theft,
flood, earthquake or other natural disaster, breakdown of public or private or common carrier
communications or transmission facilities, equipment failure, or gross negligence or willful
misconduct of Company or Agent or (ii) such failure or delay resulted from Bank's reasonable
belief based upon the advice of its counsel that the action would have violated any guideline,
rule or regulation of any governmental authority.
(d) Bank shall have no duty to inquire or determine whether Company's obligations to Agent are in default or
whether Agent is entitled to provide the Notice to Bank. Neither Bank nor Agent shall have any
duty to inquire or determine whether either such party is authorized to execute this
Agreement. Each of Bank and Agent may rely on notices and communications it believes in good
faith to be genuine and given by the appropriate party.
(e) Notwithstanding any of the other provisions in this Agreement, in the event of the commencement of a
case pursuant to Xxxxx 00, Xxxxxx Xxxxxx Code, filed by or against Company, or in the event of
the commencement of any similar case under then applicable federal or state law providing for
the relief of debtors or the protection of creditors by or against Company, Bank may act as
Bank deems necessary to comply with all applicable provisions of governing statutes (and shall
use commercially reasonable efforts to inform Agent of such acts if allowed by law) and shall
not be in violation of this Agreement as a result.
(f) Bank shall be permitted to comply with any writ, levy order or other similar judicial or regulatory
order or process concerning the Lockbox, the Lockbox Account or any Check and shall not be in
violation of this Agreement for so doing.
8. Indemnity.
(a) Company, hereby agrees to indemnify, defend and save harmless Bank against any loss, liability or
expense incurred in connection with this Agreement, the Lockbox or the Lockbox Account (except
to the extent due to Bank's willful misconduct or gross negligence) or incurred at Company's
direction or instruction, including without limitation any Returned Items or Charges.
(b) Company agrees to pay to Bank, upon receipt of Bank's invoice, all costs, expenses and attorneys' fees
(including allocated costs for in-house legal services) incurred by Bank in connection with the
enforcement of this Agreement and any instrument or agreement required hereunder, including but
not limited to any such costs, expenses and fees arising out of the resolution of any conflict,
dispute, motion regarding entitlement to rights or rights of action, or other action to enforce
Bank's rights in a case arising under Xxxxx 00, Xxxxxx Xxxxxx Code. Company agrees to pay
Bank, upon receipt of Bank's invoice, all costs, expenses and attorneys' fees (including
allocated costs for in-house legal services) incurred by Bank in the preparation and
administration of this Agreement (including any amendments hereto or instruments or agreements
required hereunder).
(c) During the term hereof, there shall remain at all times a minimum balance of $50,000 in the Lockbox
Account for the benefit of Bank to pay amounts owed, if any, to Bank under Sections 6, 8, 9 and
10.
(d) Company agrees to provide Bank with monthly unaudited and annual audited financial statements within a
reasonable period of time after the end of each month or year-end, as applicable, to the
following address:
Bank of America, N.A.
Attn: Xxxxx Xxxxxxxxx
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xx. Xxxxx, XX 00000
9. Returned Items. If any Returned Items are not paid by the Company within five (5) Business Days after
written demand therefor by Bank to Company, and if there is not a sufficient amount in the Lockbox
Account as provided in Section 8(c) above to cover such Returned Item, then Agent shall pay to Bank
within five (5) Business Days after receipt of written demand therefor from Bank the amount of such
Returned Items; provided that the Agent shall have received such demand within one hundred (100) days
after the funds attributable to such Returned Item have been wire transferred to the Collection Account
as provided in Section 4 above.
10. Charges. If the balances in the Lockbox Account are not sufficient to compensate Bank for any Charges,
Company agrees to pay Bank within five (5) Business Days after written demand therefor from Bank the
amount of such Charges. Company acknowledges that failure to so pay Bank any such amount shall
constitute a breach of this Agreement.
11. Termination. This Agreement may be terminated by Company only upon delivery to Bank of a written
notification thereof jointly executed by Company and Agent. This Agreement may be terminated by Agent
at any time, with or without cause, seven days following its delivery of written notice thereof to each
of Company and Bank. This Agreement may be terminated by Bank at any time on not less than 30 days
prior written notice delivered to each of Company and Agent. Notwithstanding the foregoing, Bank may
terminate this Agreement at any time upon 10 days' prior written notice to Company and Agent if either
Company or Agent breaches any of the terms of this Agreement, or any other agreement with Bank involving
the borrowing of money or extension of credit. All rights of Bank under Sections 7, 8, 9 and 10 shall
survive any termination of this Agreement. Upon termination of this Agreement by Bank, any collected and
available balances in the Lockbox Account will be transferred in accordance with Agent's instructions
and the Lockbox Account will be closed. Any mail received at the Lockbox within 90 calendar days after
termination of this Agreement will be sent to the address specified below for Agent or to another
address designated in writing by Agent. Sending of the mail as described above is Bank's only
responsibility with respect to the mail received at the Lockbox within 90 calendar days after
termination of this Agreement by Bank. Bank shall forward mail at its standard charge in effect at the
time the mail is forwarded. Agent will pay Bank such charges in advance.
12. Irrevocable Agreements. Company acknowledges that the agreements made by it and the authorizations
granted by it in Sections 2, 3, and 4 hereof are irrevocable and that the authorizations granted in
Sections 2, 3 and 4 hereof are powers coupled with an interest.
13. Notices. All notices, requests or other communications given to Company, Agent or Bank shall be given in
writing (including by facsimile) at the address specified below:
If to Agent:
GENERAL ELECTRIC CORPORATION
000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
ATTN: X'Xxxxxxxx Account Officer
Fax: (000) 000-0000
With a copy (which shall not constitute notice) to:
GENERAL ELECTRIC CAPITAL CORPORATION
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
ATTN: Corporate Counsel
Corporate Financial Services - Global Sponsor Finance
Fax: (000) 000-0000
and
GENERAL ELECTRIC CAPITAL CORPORATION
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
ATTN: Corporate Counsel
Corporate Financial Services - Global Sponsor Finance
Fax: (000) 000-0000
If to Bank:
Bank of America, N. A.
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xx. Xxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxx
Fax: (000) 000-0000
If to Company:
X'XXXXXXXX INDUSTRIES, INC.
0000 Xxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
ATTN: President, Chief Financial Officer and General Counsel
Fax: (000) 000-0000
With a copy (which shall not constitute notice) to:
XXXXXXXX & XXXXX LLP
Citigroup Center
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000-0000
ATTN: Xxxxxx X. Xxxxx, Xxxxxxxx X. Xxxxxx
Fax: (000) 000-0000
Any party may change its address for notices hereunder by notice to each other party hereunder given in
accordance with this Section 13. Each notice, request or other communication shall be effective when given in
accordance with this Section 13. Each notice, request or other communication shall be effective (a) if given by
facsimile, when such facsimile is transmitted to the facsimile number specified in this Section 13 and
confirmation of receipt is made by the appropriate party, and (b) if given by any other means, including
overnight courier, when received at the address specified in this Section 13.
14. Miscellaneous.
(a) This Agreement may be amended only by a written instrument executed by the parties hereto acting by
their respective duly authorized representatives, except that Bank's Charges are subject to
change by Bank on 30 days' prior written notice to Company.
(b) This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns, but neither Company nor Bank shall be entitled to assign or
delegate any of its rights or duties hereunder without first obtaining the express prior
written consent of Agent.
(c) This Agreement may be executed in any number of several counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same instrument.
(d) THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ITS
CONFLICTS OF LAW RULES).
(e) Nothing contained in the Agreement shall create any agency, fiduciary, joint venture or partnership
relationship between Bank and Company or Lender.
(f) Company represents and warrants to the other parties that (A) this Agreement constitutes its duly
authorized, legal, valid, binding and enforceable obligation; (B) the performance of its
obligations under this Agreement and the consummation of the transactions contemplated
hereunder will not (i) constitute or result in a breach of its certificate or articles of
incorporation, by-laws or partnership agreement, as applicable, or the provisions of any
material contract to which it is a party or by which it is bound or (ii) result in the
violation of any law, regulation, judgment, decree or governmental order applicable to it; and
(C) all approvals and authorizations required to permit the execution, delivery, performance
and consummation of this Agreement and the transactions contemplated hereunder have been
obtained. Company agrees that it shall be deemed to make and renew each such representation
and warranty on and as of each day on which Company uses the services set forth in this
Agreement.
IN WITNESS WHEREOF, each of the parties has executed and delivered this Lockbox Account Agreement as of the day
and year first above set forth.
"Bank"
BANK OF AMERICA, N.A.
By:
Name: ______________________________
Title:
"Company"
X'XXXXXXXX INDUSTRIES, INC.
By:
Name: ______________________________
Title:
"Agent"
GENERAL ELECTRIC CAPITAL CORPORATION
By:
Name: _______________________
Title: Duly Authorized Signatory
EXHIBIT A
TO LOCKBOX ACCOUNT AGREEMENT
STANDARD TERMS AND CONDITIONS
The Lockbox Service involves processing Checks that are received at a Lockbox Address. With this Service,
Company instructs its customers to mail checks it wants to have processed under the Service to the Lockbox
Address. Bank picks up mail at the Lockbox Address according to its mail pick-up schedule. Bank will have
unrestricted and exclusive access to the mail directed to the Lockbox Address. Bank will provide Company with
the Lockbox Service for a Lockbox Address when Company has completed and Bank has received Bank's then current
set-up documents for the Lockbox Address.
If Bank receives any mail containing Company's lockbox number at Bank's Lockbox operations location (instead of
the Lockbox Address), Bank may handle the mail as if it had been received at the Lockbox Address.
PROCESSING
Bank will handle Checks received at the Lockbox Address according to the applicable deposit account agreement, as
if the Checks were delivered by Company to Bank for deposit to the Account, except as modified by these Terms and
Conditions.
Bank will open the envelopes picked up from the Lockbox Address and remove the contents. For the Lockbox
Address, Checks and other documents contained in the envelopes will be inspected and handled in the manner
specified in the Company's set-up documents. Bank captures and reports information related to the Lockbox
processing, where available, if Company has specified this option in the set-up documents. Bank will endorse all
Checks Bank processes on Company's behalf.
If Bank processes an unsigned check as instructed in the set-up documents, and the check is paid, but the account
owner does not authorize payment, Company agrees to indemnify Bank, the drawee bank (which may include Bank) and
any intervening collecting bank for any liability or expense incurred by such indemnitee due to the payment and
collection of the check.
If Company instructs Bank not to process a check bearing a handwritten or typed notation "Payment in Full" or
words of similar import on the face of the check, Company understands that Bank has adopted procedures designed
to detect Checks bearing such notations; however, Bank will not be liable to Company or any other party for
losses suffered if Bank fails to detect Checks bearing such notations.
RETURNED CHECK
Unless Company and Bank agree to another processing procedure, Bank will reclear a Check once which has been
returned and marked "Refer to Maker," "Not Sufficient Funds" or "Uncollected Funds." If the Check is returned
for any other reason or if the Check is returned a second time, Bank will debit the Account and return the Check
to Company. Company agrees that Bank will not send a returned item notice to Company for a returned Check unless
Company and Bank have agreed otherwise.
ACCEPTABLE PAYEES
For the Lockbox Address, Company will provide to Bank the names of Acceptable Payees ("Acceptable Payee" means
Company's name and any other payee name provided to Bank by Company as an acceptable payee for Checks to be
processed under the Lockbox Service). Bank will process a check only if it is made payable to an Acceptable
Payee and if the check is otherwise processable. Company warrants that each Acceptable Payee is either (i) a
variation of Company's name or (ii) is an affiliate of Company which has authorized Checks payable to it to be
credited to the Account. Bank may treat as an Acceptable Payee any variation of any Acceptable Payee's name that
Bank deems to be reasonable.
CHANGES TO PROCESSING INSTRUCTIONS
Company may request Bank orally or in writing to make changes to the processing instructions (including changes
to Acceptable Payees) for any Lockbox Address by contacting its Bank representative, so long as such changes do
not conflict with the terms of the Deposit Account Control Agreement. Bank will not be obligated to implement
any requested changes until Bank has actually received the requests and had a reasonable opportunity to act upon
them. In making changes, Bank is entitled to rely on instructions purporting to be from Company.
