EXHIBIT 2.1
SUPPORT AGREEMENT
THIS SUPPORT AGREEMENT (as the same may be amended, modified or
supplemented from time to time, the "Agreement") is entered into as of
February 27, 2002 by and between GC Companies, Inc. ("GCX," and,
together with its chapter 11 debtor affiliated entities, the "GCX
Debtors"), the Official Committee of Unsecured Creditors in the
Chapter 11 Cases of the GCX Debtors (the "Committee"), AMC
Entertainment Inc., a Delaware corporation ("AMCE"), and The Bank of
Nova Scotia ("BNS") (the parties hereto being hereinafter referred to
collectively as the "Parties" and individually as a "Party"), with
reference to the following facts and recitals:
RECITALS
A. The GCX Debtors are the Debtors and Debtors in
Possession in cases under chapter 11 of the United States Bankruptcy
Code which are currently pending in the United States Bankruptcy Court
for the District of Delaware as case nos. 00-3897 (EIK) - 00-3927
(EIK), inclusive (the "Chapter 11 Cases").
B. BNS is a creditor of GCX and/or one or more of the
other GCX Debtors and asserts claims in the Chapter 11 Cases.
C. AMCE is the sponsor, and the GCX Debtors and the
Committee are the Proponents, of the First Amended Joint Plan of
Reorganization of Debtors and Official Committee of Unsecured
Creditors of GC Companies, Inc. and its Jointly Administered
Subsidiaries dated January 30, 2002 (the "Plan"), which Plan provides
for acquisition of 100% of the stock of reorganized GCX by AMCE or its
designee following the confirmation and effective date of the Plan.
In accordance with the Plan, AMCE has entered into that certain Stock
Purchase Agreement dated January 15, 2002 among GCX, AMCE, American
Multi-Cinema, Inc. and Centertainment Development, Inc. Capitalized
terms used and not defined in this Agreement have the same meaning as
in the Plan.
D. The Plan provides, or at AMCE's election or by
modification of the Plan may provide, for treatment of BNS's Claims as
set forth on the attached Exhibit "A" (the "Proposed Treatment"). The
execution and delivery of this Agreement and the performance by BNS of
its obligations hereunder satisfies the Bank Support Agreement
Condition referenced in section 5.4.1 of the Plan and satisfies any
other Plan condition that is specifically related to the Proposed
Treatment.
E. AMCE has negotiated an agreement similar to this
Agreement regarding the Plan with certain claimants in the Chapter 11
Cases, to wit: the Committee, General Electric Capital Corporation
("GECC"), and Harcourt General, Inc. ("Harcourt") (the "Initial
Support Agreement"), and with Fleet National Bank ("Fleet") and Bank
of America, N.A. ("BofA") (the "Fleet/BofA Support Agreement"); AMCE
may also attempt to negotiate similar agreements with the Fifth Third
Leasing Company, Bank Leumi Leasing Corporation, Fleet Capital
Corporation, Imperial Bank, ReliaStar Life Insurance Company, as
successor by merger to ReliaStar, Northern Life Insurance Company,
ReliaStar Life Insurance Company of New York, f/k/a ReliaStar Bankers
Security Life Insurance Company, Simon Property Group, Multifoods
Distribution Group, ▇▇▇▇▇▇▇ Marketing Group, Dandy Amusement, Pepsi-
Cola North America and the ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ family (all of the
foregoing being collectively referred to as the "Intended
Participants").
F. In order to induce the Debtors, the Committee and
AMCE to continue to expend the effort and resources involved in
seeking confirmation of a plan of reorganization, and to include the
Proposed Treatment as part of the plan of reorganization, BNS has
agreed to the terms of this Agreement. In order to induce BNS to
resolve BNS's Claims in a consensual manner, the Debtors, the
Committee, and AMCE have agreed to support the Proposed Treatment
under the terms of this Agreement. All parties acknowledge that the
commitments evidenced hereby represent compromises of good-faith
disputes that render the confirmation of a plan of reorganization
substantially more likely, and therefore that the execution and
delivery of this Agreement constitutes valuable consideration to each
of the Parties.
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by the
Parties, the Parties hereby agree as follows:
1. Support of Proposed Treatment by GCX and the
Committee. Each of the GCX Debtors and the Committee agrees that it
will promptly file a motion under section 1127 of the Bankruptcy Code
and Bankruptcy Rule 3019 to modify the Plan so as to incorporate
within the Plan the Proposed Treatment (the Plan, as so modified, the
"Modified Plan") and for a determination that (x) such modification
does not adversely change the treatment of the Claim of any Holder
thereof or the Interest of any Holder thereof who has not accepted in
writing the modification and (y) the Modified Plan shall be deemed
accepted by all Holders who have previously accepted the Plan.
Conditioned upon the timely satisfaction of each of the Conditions
Subsequent described in paragraph 6, each of the GCX Debtors and the
Committee agrees that: (i) each will take all reasonable actions to
obtain confirmation of the Modified Plan and the occurrence of the
Effective Date thereunder, (ii) neither the Committee nor any of the
GCX Debtors will propose nor support a plan of reorganization in the
Chapter 11 Cases that omits, alters, amends, modifies or impairs the
Proposed Treatment, unless BNS consents thereto in writing, and (iii)
neither the Committee nor any of the GCX Debtors will take any action
or seek any relief in the Chapter 11 Cases that would be inconsistent
with any of the provisions of this paragraph, unless BNS consents
thereto in writing.
2. Support of Proposed Treatment by AMCE. AMCE agrees
that the Modified Plan will include the Proposed Treatment.
Conditioned upon the timely satisfaction of each of the Conditions
Subsequent described in paragraph 6, AMCE agrees that: (i) AMCE will
take all reasonable steps to support confirmation of the Modified Plan
and the occurrence of the Effective Date thereunder, provided that
nothing herein shall require AMCE to waive or modify any rights or
conditions that it may have, including without limitation as to the
occurrence of the Effective Date, (ii) AMCE will not support or
propose a plan of reorganization in the Chapter 11 Cases that omits,
alters, amends, modifies or impairs the Proposed Treatment, unless BNS
consents thereto in writing, and (iii) AMCE will not take any action
or seek any relief in the Chapter 11 Cases that would be inconsistent
with any of the provisions of this paragraph, unless BNS consents
thereto in writing.
3. Support by BNS for Plan that Includes the Proposed
Treatment. BNS agrees that it will support the Modified Plan.
Conditioned upon the timely satisfaction of each of the Conditions
Subsequent described in paragraph 6, BNS agrees that it: (a) will not
support or solicit any bid for GCX or any other GCX Debtor or for any
assets thereof, other than by AMCE; (b) will not vote for, consent to,
support, or participate in the negotiation or formulation of (i) any
plan of reorganization or liquidation for GCX or any other GCX Debtor
filed or to be proposed or filed in any or all of the Chapter 11 Cases
with respect to any or all of the GCX Debtors, other than the Modified
Plan, or which provides for the disposition of any substantial portion
of the assets of GCX or any other GCX Debtor to any party other than
AMCE, or (ii) any disposition outside of a plan of reorganization of
any substantial portion of the assets of GCX or any other GCX Debtor
to any party other than AMCE; (c) will use commercially reasonable
efforts (which will not be interpreted to require a Party to pay any
amount other than its own attorneys' fees) to support confirmation of
the Modified Plan; (d) will not object to confirmation of the Modified
Plan or otherwise commence any proceeding to oppose or alter the
Modified Plan or any other reorganization documents containing terms
and conditions consistent with the Modified Plan, and will discontinue
all discovery in connection with the Modified Plan; (e) will not
directly or indirectly seek, solicit, support or encourage any plan,
proposal or offer of dissolution, winding up, liquidation,
reorganization, merger or restructuring of GCX or any other GCX Debtor
other than the Modified Plan; and (f) will not take any other action
that is inconsistent with, or that would obstruct or hinder
confirmation of, the Modified Plan.
4. Plan Support. BNS, subject to the Conditions
Subsequent, agrees (solely on behalf of itself and not as agent for
any other person) to vote all of BNS's Claims in favor of the Modfied
Plan. In addition, BNS agrees to direct Fleet, as administrative
agent, to either vote the Claims of Harcourt in favor of the Modified
Plan or to refrain from exercising its right to vote such Claims under
the Intercreditor Agreement. The Parties acknowledge that the votes
of BNS for the Modified Plan were solicited by means of the Disclosure
Statement for the Plan, that the Parties have negotiated in good faith
concerning their disputes relative to the treatment of BNS proposed in
the Plan, that the Modified Plan does not adversely change the
treatment of the Claim of any Holder thereof or the Interest of any
Holder thereof who has not accepted in writing the modification, that
this Agreement embodies the settlement and compromise of such
disputes, and is intended by each of the Parties to be fully binding.
5. Specific Performance. Each Party agrees and
acknowledges that upon the breach of this Agreement by such Party, the
other Parties hereto would not have an adequate remedy at law, and
that money damages would both be inadequate and difficult to
calculate. Therefore, each Party hereby agrees that upon the breach
by such Party of this Agreement, the Bankruptcy Court in the
Chapter 11 Cases (or, if such court does not have jurisdiction, a
court of competent jurisdiction) may direct such Party to specifically
perform its obligations hereunder and may enjoin such Party from
violating its obligations hereunder, without the posting of any bond
or other security by any Party seeking relief under this paragraph 5.
6. Conditions Subsequent.
(a) Subject to the rights of AMCE under
subparagraph (b) of this paragraph 6, and subject to the rights
of any non-breaching Party under subparagraph (c) of this
paragraph 6, this Agreement, and the obligations of the Parties
thereunder, shall terminate and be of no further force or effect
if any of the following conditions ("Conditions Subsequent")
shall not have been satisfied by the indicated date:
(i) An order of the Bankruptcy Court
confirming the Modified Plan, the terms of which order are
materially consistent with the Proposed Treatment (the
"Confirmation Order"), shall have been entered on or
before March 20, 2002.
(ii) The Confirmation Order shall have become
a final, nonappealable order on or before April 1, 2002.
(b) If AMCE has not breached its obligations under
this Agreement, it may extend the date set forth in clauses (i)
and (ii) of subparagraph (a) for a period of up to thirty days,
by giving written notice of such election to BNS on or before
the applicable date which is being extended.
(c) In the event that the failure to occur of any
of the Conditions Subsequent set forth above is the result of a
breach of this Agreement by any Party, the non-breaching Party
may, by the written agreement of such non-breaching Party,
extend the time for satisfying such Conditions Subsequent to any
date that it elects, without the agreement of the breaching
Party. This provision shall in no way limit any right or remedy
which any Party may otherwise have for the breach of this
Agreement.
(d) Each Party to this Agreement agrees (i) to use
commercially reasonable efforts, which shall not be construed to
require the payment of money by any Party, other than to its own
attorneys, to cause the Conditions Subsequent to be satisfied on
a timely basis and (ii) to cooperate with the other Parties in
achieving the Conditions Subsequent as expeditiously as
reasonably possible (and prior to the dates set forth above).
(e) Any Party may terminate this Agreement upon
written notice to all other Parties in the event that the
Initial Support Agreement or the Fleet/BofA Support Agreement is
terminated or if the Plan is revoked or withdrawn.
7. Governing Law. Except to the extent that the
Bankruptcy Code or Bankruptcy Rules are applicable, the rights and
obligations arising under this Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of
New York, without giving effect to the principles of conflicts of law
thereof.
8. Notices. All notices, requests, or demands to a
Party under or in connection with this Agreement shall be in writing
and shall be delivered by hand, sent by recognized overnight courier
or sent by telecopier, telex or similar electronic means to the Party
(followed by overnight delivery transmitted the same day) properly
addressed to such Party as set forth below, or to such other address
or telecopier number as such Party shall provide to each other Party
hereto in writing, and shall be deemed sent or given hereunder, in the
case of delivery by recognized overnight courier, on the date of
actual delivery, in the cases of transmission by telecopier, telex or
similar electronic means (followed by overnight delivery transmitted
the same day) on the date of actual transmission, and in the case of
personal delivery, on the date of actual delivery:
To the GCX Debtors:
G. ▇▇▇▇ ▇▇▇▇▇▇▇
President, Chief Operating Officer and Chief
Financial Officer
With a copy to: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
GC Companies, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
-and-
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇ Procter LLP
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To the Committee:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To AMCE:
▇▇▇▇▇ ▇. ▇▇▇▇▇
Chairman, Chief Executive Officer and President
AMC Entertainment Inc.
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
-and-
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇., Esq.
▇▇▇▇▇▇▇ & ▇▇▇▇ ▇.▇.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
-and-
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ PC
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To BNS:
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Director
The Bank of Nova Scotia
New York Agency
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
-and-
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Carrington, Coleman, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
9. Entire Agreement; Modification; Waiver. This
Agreement (including the Exhibits hereto, which are incorporated by
reference) constitutes the entire agreement between the Parties as to
the Proposed Treatment and supersedes all prior and contemporaneous
agreements, representations, warranties, and understandings of the
Parties, whether oral, written or implied, as to the Proposed
Treatment. No supplement, modification, or amendment of this
Agreement shall be binding unless executed in writing by all Parties
affected thereby. No waiver of any of the provisions of this
Agreement shall be deemed or constitute a waiver of any other
provision, whether or not similar, nor shall any waiver constitute a
continuing waiver. No waiver shall be binding unless executed in
writing by the Party making the waiver.
10. No Third-Party Beneficiaries. Nothing contained in
this Agreement is intended to confer any rights or remedies under or
by reason of this Agreement on any person or entity other than the
Parties hereto, nor is anything in this Agreement intended to relieve
or discharge the obligation or liability of any third party to any
Party to this Agreement, nor shall any provision give any third party
any right of subrogation or action over or against any Party to this
Agreement.
11. Successors and Assigns. This Agreement shall be
binding upon, and shall inure to the benefit of, the Parties and their
respective legal representatives, successors, and assigns.
12. Further Documents. Each Party hereto agrees to
execute any and all documents and to do and perform any and all acts
and things necessary or proper to effectuate or further evidence the
terms and provisions of this Agreement.
13. No Representations or Warranties. Except as
expressly set forth in this Agreement, none of the Parties hereto
makes any representation or warranty, written or oral express or
implied.
14. Headings. The descriptive headings of the several
sections of this Agreement are inserted for convenience of reference
only and do not constitute a part of this Agreement.
15. Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.
16. Due Authorization. Each Party to this Agreement
hereby represents and warrants that (i) such Party is duly-authorized
to enter into this Agreement; and (ii) the person purporting to
execute this Agreement on behalf of such Party has been duly-
authorized to execute this Agreement on behalf of and bind such Party
(and its affiliates, to extent provided in the initial paragraph
hereof).
17. Attorneys' Fees. In any action or proceeding
brought by a Party hereto against any other Party hereto to enforce
any provision of this Agreement, or to seek damages for a breach of
any provision hereof, or where any provision hereof is validly
asserted as a defense, the prevailing Party shall be entitled to
recover reasonable attorneys' fees and costs from the other Party in
addition to any other available remedy.
IN WITNESS WHEREOF, each of the Parties hereto has caused
this Agreement to be executed on its behalf by its officers thereunto
duly authorized, all as of the date and year first above written.
GC COMPANIES, INC., on behalf of
itself and its affiliated chapter 11
debtors
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and General Counsel
THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS IN THE CHAPTER 11 CASES
OF THE GCX DEBTORS
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Chairman
AMC ENTERTAINMENT INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President - Finance, Chief Financial Officer
and Chief Accounting Officer
THE BANK OF NOVA SCOTIA
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Director
EXHIBIT A TO SCOTIABANK SUPPORT AGREEMENT
"Proposed Treatment" means the following:
(1) In its capacity as administrative agent for the Domestic Banks,
Fleet National Bank ("Fleet") would, through the Effective Date,
continue to receive adequate protection payments in conformity with
paragraph 19 of that certain Final Order (A) Approving Debtors'
Motion for Order Authorizing Debtors to Incur Postpetition Secured
Indebtedness on a Final Basis and (B) Granting Security Interests
and Superpriority Claims and Adequate Protection, dated as of
November 8, 2000 (the "Cash Collateral Order").
(2) In its capacity as administrative agent for the Domestic Banks,
Fleet would receive, in conformity with the Cash Collateral Order
an additional adequate protection payment on the Effective Date, in
cash, consisting of a pro-rated sum for any stub period that exists
between the last monthly payment and the Effective Date.
(3) The DIP Lenders' Allowed DIP Facility Claims would be treated as
provided in Section 2.1.1 of the Plan, it being understood that
there are no outstanding disputes as to any DIP Facility Claim.
(4) The Domestic Banks shall be deemed to have Allowed Class 4
Domestic Bank Claims in the aggregate amount of $44.6 million,
which Claims shall specifically exclude the BNS Letter of Credit
Claims described in paragraphs 6 and 7 below. Fleet shall be
deemed to have an Allowed Class 4 Domestic Bank Claim in the amount
of $26,760,000, and BNS shall be deemed to have an Allowed Class 4
Domestic Bank Claim in the amount of $17,840,000. Each Holder of
an Allowed Class 4 Domestic Bank Claim (i) will retain, in respect
of such Claim, its ratable share of all Adequate Protection
Payments made to it or for its account prior to the first day of
the month during which the Effective Date occurs, (ii) will
receive, in respect of such claim, the benefits of section 12.1.3
of the Modified Plan, and (iii) will receive, within five Business
Days after the Effective Date, in respect of such Claim, (A) such
Holder's ratable share of the Adequate Protection Payments, pro
rated through the Effective Date, that would otherwise have been
due under prior orders of the Bankuptcy Court and that have not yet
been paid, and (B) such Holder's ratable share of New AMCE Notes
with a face amount equal to $44.6 million; provided, however, that
each Holder of an Allowed Class 4 Domestic Bank Claim may elect to
exercise the New AMCE Notes Exchange Option and receive Cash in an
amount equal to 87.5% of the face amount of the New AMCE Notes to
which it would otherwise have been entitled. Whether or not the
New AMCE Notes Exchange Option is exercised, such treatment would
be deemed to fully satisfy all claims and rights of each Domestic
Bank against Harcourt under the Intercreditor Agreement. BNS
hereby conclusively and irrevocably is deemed, as to BNS's Allowed
Class 4 Domestic Bank Claims only, to have elected to exercise the
New AMCE Notes Exchange Option and will therefore receive its
ratable share of $39,025,000 in Cash, which Cash is calculated to
be $15,610,000.
(5) Reorganized GCX shall pay an additional $500,000 to BNS within
five (5) Business Days following the Effective Date.
(6) With respect to that certain Standby Letter of Credit dated
December 12, 1996 issued by BNS to Liberty Mutual (as amended, the
"Liberty L/C") pursuant to an Application of GCX therefor with
Joint and Several Guarantee (as amended, the "Liberty L/C
Reimbursement Agreement"), the Liberty L/C Reimbursement Agreement
would be assumed by Reorganized GCX and, subject to the Corporate
Restructuring Program, the Reorganized GCX Debtors that are
guarantors thereof; provided however, that AMCE shall cause
Reorganized GCX to replace the Liberty L/C with a substitute letter
of credit, as permitted by Section 8 of that certain Agreement for
Guarantee of Deductible Reimbursement dated March 7, 2000 (the
"Deductible Reimbursement Agreement") between GCX and Liberty
Mutual, which substituted letter of credit will be issued pursuant
to the letter of credit subfacility under that certain Amended and
Restated Credit Agreement dated as of April 10, 1997 (as amended,
the "AMCE Credit Agreement") among AMCE, BNS (as administrative
agent), Bank of America Trust and Savings Association (as
documentation agent) and the lenders party thereto. Under the
terms of the Deductible Reimbursement Agreement, Reorganized GCX
shall instruct Liberty to return the original of the Liberty L/C to
BNS with an acknowledgement by Liberty that it has been replaced
and is no longer in effect within 60 days after the Effective Date.
Reorganized GCX would assume the prepetition Liberty Mutual
Workers' Compensation Program and the Deductible Reimbursement
Agreement, and BNS and Reorganized GCX would cooperate in reducing
the amount of the Liberty L/C. The GCX Debtors would pay in full
any liquidated amounts that become due under the Liberty Program
prior to the Effective Date and, to the extent the GCX Debtors do
not pay such amounts and Liberty calls such amounts under the
Liberty L/C, the GCX Debtors would pay such amounts pursuant to the
Liberty L/C Reimbursement Agreement. AMCE acknowledges that any
such payments could result in additional cash requirements of the
Reorganized GCX Debtors that would need to be funded by AMCE as of
the Effective Date.
(7) With respect to that certain Standby Letter of Credit No.
007/82875/99 issued by BNS to Fleet in the amount of $2.4 million
(including any renewal thereof, the "Chile L/C") pursuant to an
Application of GCX therefor with Reimbursement Agreement (as
amended, the "Chile L/C Reimbursement Agreement") that is
collateralized by a cash collateral account in the amount of $2.4
million, the Chile L/C Reimbursement Agreement would be assumed by
Reorganized GCX and, subject to the Corporate Restructuring
Program, the Reorganized GCX Debtors that are guarantors thereof,
if any. In the event that the Chile L/C is drawn on prior to or on
the Effective Date, the Confirmation Order will provide that the
automatic stay will be lifted without further order of the
Bankruptcy Court to allow BNS to realize upon the collateral
securing the Chile L/C. The Chile L/C Reimbursement Agreement will
continue to be secured by the cash collateral account after the
Effective Date.
(8) The Modified Plan would contain provisions substantially similar
to sections 9.2.5, 12.1.3, 15.1 and 16.9 of the draft Modified Plan
dated February 27, 2002 that has been received and reviewed by the
Parties hereto.
8
Execution Copy
Scotiabank
A-2
Exhibit "A"
