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EXHIBIT 10.31
INTERCREDITOR AGREEMENT dated as of
October 6, 1995 among (i) CHEMICAL BANK as
Agent, (ii) THE INTERPUBLIC GROUP OF
COMPANIES, INC. ("IPG"), (iii) ALL AMERICAN
XXXXXXX, INC., a wholly owned subsidiary of
All American Communications Inc. ("AAG"),
(iv) ALL AMERICAN COMMUNICATIONS, INC.
("AACI"), (v) ALL AMERICAN FREMANTLE II,
INC., a wholly owned subsidiary of All
American Fremantle, Inc. ("AAFII"), (vi) ALL
AMERICAN TELEVISION II, INC., a wholly owned
subsidiary of All American Television Inc.
("AATII"), and (vi) XXXX XXXXXXX PRODUCTIONS,
LLC (the "LLC").
INTRODUCTORY STATEMENT
WHEREAS, LLC, IPG and certain other parties have entered into
an Asset Purchase Agreement dated as of October 6, 1995 (the "Asset Purchase
Agreement") with Xxxx Xxxxxxx Productions, L.P. and The Child's Play Company
(collectively "Sellers") pursuant to which LLC and IPG will purchase certain of
the assets and the LLC will assume certain liabilities of the Sellers; and
WHEREAS, AACI, AAG, IPG and Infoplan International, Inc.
("Infoplan") have entered into an Amended and Restated Operating Agreement (the
"Operating Agreement") dated as of October 6, 1995 in connection with the
operations of LLC which Operating Agreement shall become effective immediately
after the Final Closing (as defined in the Asset Purchase Agreement); and
WHEREAS, each of AAG, AAFII and AATII (collectively, the
"Guarantors") contemplates executing a Guaranty (the "Guaranty") in favor of
IPG guaranteeing the Guarantor Obligations (as hereinafter defined), which
Guaranty shall be in form and substance reasonably acceptable to the Agent (as
hereinafter defined); and
WHEREAS, each of the Guarantors contemplates entering into a
Security Agreement (the "Security Agreement") in connection with the Guaranty
wherein their obligations under the Guaranty will be secured by a security
interest in the IPG Collateral (as hereinafter defined) subordinated to the
Agent on the terms and conditions hereinafter set forth, which Security
Agreement shall be in form and substance reasonably acceptable to the Agent;
and
WHEREAS, each of AACI, All American Television, Inc. ("AAT")
and All American Fremantle International Inc. ("AAF")
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contemplates entering into a Pledge (the "Pledge Agreement") in favor of IPG
wherein AACI, AAT and AAF will each pledge its right, title and interest in the
Pledged Stock (as hereinafter defined) to IPG in connection with the Guarantor
Obligations, which Pledge Agreement shall be in form and substance reasonably
acceptable to the Agent; and
WHEREAS, pursuant to the Credit, Security, Guaranty and Pledge
Agreement dated as of April 13, 1995, as amended and as may from time to time
be amended (subject to Section 17(d) hereof) (the "Chemical Agreement") among
AAG, AACI, and certain of their affiliates, the Lenders named therein and
Chemical Bank as Agent for the Lenders, the Lenders have agreed to issue a
letter of credit (the "Letter of Credit") subject to the terms and conditions
of, the Chemical Agreement; and
WHEREAS, each of the Guarantors has granted to the Agent a
security interest in the Tranche E Collateral (as hereinafter defined) as
security for its Chemical Obligations (as hereinafter defined); and
WHEREAS, the execution of this Intercreditor Agreement is
required both by the terms of the Operating Agreement and in order to induce
the Lenders to consent to the issuance of the Letter of Credit and the
transactions contemplated by the Operating Agreement and the Asset Purchase
Agreement; and
WHEREAS, the parties hereto desire to enter into this
Intercreditor Agreement with respect to the exercise of certain rights,
remedies and options by the respective parties under the aforementioned
documents.
Therefore, for good and valuable consideration, receipt of
which is hereby acknowledged by the parties, the parties hereto agree as
follows:
Section 1. Definitions. The following terms as used herein
shall have the following meanings:
"AAG Expense Account" shall mean the account established by
AAG with the Agent, into which the Expense Funds shall be deposited.
"AAG Funds" shall mean monies received by AAG pursuant to the
License Agreements or otherwise, including, without limitation AAG's
distribution fees but excluding Expense Funds deposited in the Expense Account
and LLC Funds deposited in the LLC Funds Account.
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"AAG Funds Account" shall mean the account established by AAG
with the Agent designated as the "All American Xxxxxxx AAG Funds Account",
Account No. 323-208118.
"Agent" shall mean Chemical Bank, acting on its own behalf and
as agent to the Lenders.
"All American Members" shall be as defined in the Operating
Agreement.
"Allocation Certificate" shall mean a certificate of an
Authorized Officer of AAG substantially in the form attached hereto as Exhibit
A or such other form as may be satisfactory to the Agent and IPG.
"Asset Purchase Agreement" shall be as defined in the
Introductory Statement.
"Authorized Officer" shall mean with respect to any
corporation, the Chief Executive Officer, the Chief Financial Officer, the
Controller or the Vice President-Finance.
"Business Day" shall mean any day other than a Saturday,
Sunday or other day in which Lenders are permitted to close in the State of New
York.
"Cash Collateral Accounts" shall mean the AAG Expense Account,
the AAG Funds Account and the LLC Funds Account.
"Chemical Agreement" shall be as defined in the Introductory
Statement.
"Chemical Obligations" shall mean the Obligations of such
Person to the Agent and the Lenders pursuant to the terms of the Chemical
Agreement, the notes and other documents contemplated thereby.
"Credit Obligations" shall mean the Chemical Obligations of
the Guarantors excluding therefrom the Senior Obligations of the Guarantors.
"Determination Date" shall mean the last Business Day of each
month.
"Dividend Distribution" shall mean the Special Distribution to
Interpublic due pursuant to Section 5.3(b)(i)(B), 5.3(b)(ii)(B) or
5.3(b)(iii)(A) of the Operating Agreement.
"Earn-Out Payment" shall mean Earn-Out Payments (as defined in
the Asset Purchase Agreement) due under Section 3.8(c)(i) of the Asset Purchase
Agreement.
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"Escrow Agreement" shall mean the Escrow Agreement dated the
6th day of October 1995 among the Sellers, the LLC, IPG, the Estate of Xxxx
Xxxxxxx and AACI and U.S. Trust Company of California, N.A. as Escrow Agent.
"Expense Funds" shall mean funds which represent recoupable
payments on account of reimbursement of expenses of AAG and its affiliates.
"Event of Default" shall be as defined in the Chemical
Agreement.
"Final Closing Date" shall be the date on which the escrow
which is established pursuant to the Asset Purchase Agreement has been
released.
"Guarantor Obligations" shall mean the Obligations of the
Guarantors in favor of IPG guaranteeing the Parent Obligations and the
Obligations of the Obligors pursuant to Section 19 in favor of IPG.
"Guarantors" shall be as defined in the Introductory Statement.
"Guaranty" shall be as defined in the Introductory Statement.
"Interest Reserve Account" shall mean an interest bearing
account of AAG established on or before the Final Closing Date with the Agent
designated as the "All American Interest Reserve Account", Account No.
323-208517.
"International Cash Flow" shall mean all amounts actually
received (or deemed to be received by the LLC pursuant to the provisions of the
Operating Agreement) by the LLC from AAG under the terms of the Main License
(other than payments in respect of the domestic exploitation of Programs).
"International Cash Flow Default" shall occur in the event
International Cash Flow at any date indicated below in column (x) is less, on a
cumulative basis commencing with the Closing, than the corresponding amounts
listed below in column (y):
(x) (y)
12/31/95 $ 1.0M
03/31/96 2.5M
06/30/96 3.5M
09/30/96 5.5M
12/31/96 7.0M
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03/31/97 8.5M
06/30/97 10.0M
09/30/97 11.5M
12/31/97 13.5M
03/31/98 14.5M
06/30/98 16.5M
09/30/98 18.0M
12/31/98 19.5M
and the outstanding balance of the Tranche E Loan (whether by voluntary
prepayment by AAG or any of its affiliates or otherwise) at such time as
indicated below in column (x) is greater than the amount indicated below in
column (y):
(x) (y)
from the date of Closing $21.7M
to 12/31/96
from 1/1/97 to 12/31/97 17.8M
from 1/1/98 to maturity 12.7M
"Interpublic Members" shall be as defined in the Operating
Agreement.
"IPG Collateral" shall mean (i) the property of the Guarantors
in which a Lien has been or will be granted to IPG pursuant to the Security
Agreement and (ii) the Pledged Stock.
"IPG Obligation Documents" shall mean the Security Agreement,
the Guaranties, the Pledge Agreement and the other documents, instruments and
agreements contemplated thereby, as they may be amended or otherwise modified
from time to time subject to Section 17(c).
"Lenders" shall mean the Lenders listed on the signature pages
of the Chemical Agreement and any assignees thereof pursuant to the Chemical
Agreement.
"Letter Agreement" shall mean the letter agreement dated
October 6, 1995, among AACI, AAG, IPG, Infoplan, Interpublic Game Shows, Inc.,
AATII, AAFII and the LLC.
"Letter of Credit" shall be as defined in the Introductory
Statement.
"Lien" shall mean any pledge, mortgage, security, interest,
encumbrance, lien, copyright mortgage, or charge of any kind whatsoever
(including any conditional sale or other title retention agreement, any lease
in the nature thereof, and the filing of or agreement to give any financing
statement under the Uniform Commercial Code of any jurisdiction).
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"LLC Funds" shall mean monies owed to the LLC by AAG and its
sublicensees pursuant to the License Agreements.
"LLC Funds Account" shall mean the account established by AAG
with the Agent designated as the "All American Xxxxxxx LLC Funds Account",
Account No. 323-213480.
"License Agreements" shall mean the Main License, and the
sub-licenses referred to in Section 4 of the Main License.
"Main License" shall mean the License Agreement dated October
__, 1995 between LLC and AAG.
"Obligations" shall mean all indebtedness and liabilities,
whether absolute, fixed or contingent, whether matured or unmatured, liquidated
or unliquidated, including, without limitation, any premium payable upon
acceleration of any note, at any time and from time to time owing by any person
under or in connection with any agreement, document or loan agreement or any
note including, without limitation, all amounts at any time on account of fees,
costs, commissions, expenses and costs.
"Obligors" shall mean AACI and the Guarantors.
"Operating Agreement" shall be as defined in the Introductory
Statement as it may be amended or otherwise modified from time to time subject
to Section 17(c).
"Operating Payment" shall mean a disbursement to the LLC to
reimburse the LLC for any fees or expenses incurred by the LLC in connection
with its operations; provided, however, that Operating Payment shall not
include fees or expenses which AACI is obligated to pay pursuant to Section
3.5(a) of the Operating Agreement.
"paid in full" or "payment in full" or any other similar term
or phrase shall mean (a) when used with respect to the Senior Obligations,
payment in full in cash and (b) when used with respect to the Guarantor
Obligations, payment in full in cash or with respect to the "Make Whole"
Obligations of AACI, satisfaction of such obligations through the payment of
cash and/or the issuance of stock as provided in the Operating Agreement.
"Parent Obligations" shall mean the Obligations of AACI to IPG
in connection with certain "Put" and "Make Whole Obligations" of AACI pursuant
to the Operating Agreement and certain indemnification Obligations of AACI to
IPG pursuant to the Letter Agreement.
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"Person" shall mean any natural person, corporation, division
of a corporation, partnership, trust, joint venture, association, company,
estate, unincorporated organization or government or any agency or political
subdivision thereof.
"Pledge Agreement" shall be as defined in the Introductory
Statement.
"Pledged Stock" shall mean all issued and outstanding capital
stock of AAG, AAFII and AATII and the membership interest of AACI and AAG in
the LLC.
"Security Agreement" shall be as defined in the Introductory
Statement.
"Sellers" shall be as defined in the Introductory Statement.
"Senior Obligation Documents" shall mean the Chemical
Agreement, the Notes referred to therein and the other documents, instruments
and agreements contemplated thereby, as they may be amended or otherwise
modified from time to time subject to Section 17(d).
"Senior Obligations" shall mean the following Obligations of
AACI and the Guarantors under the Chemical Agreement in connection with the
Tranche E Loan, whether outstanding at the date hereof or hereafter incurred or
created, (i) all obligations to pay principal and interest (including, without
limitation, interest accruing after the commencement of any bankruptcy,
insolvency, reorganization or similar proceedings with respect to AACI or any
Guarantor, whether or not determined to be an allowed claim in any such
proceeding) with respect to such Tranche E Loan; (ii) all obligations to pay
charges, costs, expenses and fees, in connection with the administration of the
Tranche E Loan or the enforcement of the Agent's or the Lenders' rights in
connection therewith, including, without limitation, the disbursements and
reasonable fees of counsel to the Agent or the Lenders; and (iii) all
obligations to reimburse or indemnify the Agent and the Lenders in any way
arising out of the administration or enforcement of the Tranche E Loan;
provided, however, that the principal amount included within this definition
shall not exceed $25,000,000 and the interest rate used for purposes of this
definition shall be based on the terms of the Chemical Agreement as in effect
on the Final Closing Date.
"Settlement Date" shall mean (a) with respect to any Earn-Out
Payments, the 15th Business Day of each month, (b) with respect to any Dividend
Distribution, the first Business Day of the month of March of each year, and
(c) in all other cases, the 15th Business Day of each quarter.
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"Special Distribution" shall be as defined in the Operating
Agreement.
"Suspension Event" shall be as defined in Section 13(a)
herein.
"Tax Distribution" shall mean the Special Distribution to the
Interpublic Members and All American Members pursuant to Section 5.3(b)(i)(A),
5.3(b)(ii)(A) or 5.3(b)(iii)(A) of the Operating Agreement.
"Tranche E Collateral" shall mean all property of the
Guarantors in which a Lien has been or will be granted to the Agent for the
benefit of the Lenders pursuant to the Chemical Agreement.
"Tranche E Event of Default" shall mean:
(i) the Main License shall become void or voidable or
otherwise nonenforceable;
(ii) default shall be made in the payment of any principal
of or interest on the Tranche E Loan or of any fees or other amounts payable by
AAG in connection with the Senior Obligations, when and as the same shall
become due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof pursuant to Section 3(a) hereof or by acceleration thereof
or otherwise and in the case of payments of any amounts other than principal,
such default shall continue unremedied for five (5) days after receipt by AAG
of an invoice therefor;
(iii) any Guarantor or the LLC shall generally not pay its
debts as they become due or shall admit in writing its inability to pay its
debts, or shall make a general assignment for the benefit of creditors; or any
Guarantor or the LLC shall commence any case, proceeding or other action
seeking to have an order for relief entered on its behalf as debtor or to
adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement,
adjustment, liquidation, dissolution or composition of it or its debts under
any law relating to bankruptcy, insolvency, reorganization or relief of debtors
or seeking appointment of a receiver, trustee, custodian or other similar
official for it or for all or any substantial part of its property or shall
file an answer or other pleading in any such case, proceeding or other action
admitting the material allegations of any petition, complaint or similar
pleading filed against it or consenting to the relief sought therein; or any
Guarantor or the LLC shall take any action to authorize any of the foregoing;
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(iv) any involuntary case, proceeding or other action
against any Guarantor or the LLC shall be commenced seeking to have an order
for relief entered against it as debtor or to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, liquidation,
dissolution or composition of it or its debts under any law relating to
bankruptcy, insolvency, reorganization or relief of debtors, or seeking
appointment of a receiver, trustee, custodian or other similar official for it
or for all or any substantial part of its property, and such case, proceeding
or other action (i) results in the entry of any order for relief against it or
(ii) shall remain undismissed for a period of sixty (60) days;
(v) an International Cash Flow Default shall have occurred
and be continuing;
(vi) an event shall have occurred which, but for the
operation of the provisions of this Intercreditor Agreement, would entitle IPG
to enforce its rights against a Guarantor in connection with the Guaranty or
against the Pledged Stock and such event shall not be waived by IPG or remedied
within 120 days after such occurrence; or
(vii) a Change in Ownership (as defined in the Operating
Agreement) shall have occurred and IPG shall have made demand on any Guarantor
in connection with the "put" obligation of AACI as a result of such Change in
Ownership.
"Tranche E Loan" shall mean (i) a loan made to AACI or AAG
pursuant to the terms of the Chemical Agreement, the proceeds of which shall be
used to fund the reimbursement obligation of AACI or AAG in connection with the
Letter of Credit and (ii) any refinancing, refunding or replacement thereof
provided that such refinancing, refunding or replacement does not change the
maturity date of the Tranche E Loan or increase the then outstanding principal
amount of the Tranche E Loan or increase the interest rate thereon or otherwise
conflict with Section 17(d).
Section 2. Disbursement of Funds.
So long as the Senior Obligations remain outstanding, the
parties agree as follows:
(a) The Agent will send to AAG and IPG on each
Determination Date a written statement informing AAG and IPG of the balance in
the AAG Funds Account, the AAG Expense Account and the LLC Funds Account and
provide AAG with copies of receipts, invoices and other correspondence
accompanying payments which are deposited in the AAG Funds Account.
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(b) One Business Day prior to each Settlement Date, AAG
will deliver to the Agent an Allocation Certificate. The Agent shall be
entitled to rely on the Allocation Certificate as delivered and shall have no
obligation to individually verify the calculations contained therein. Each
delivery of an Allocation Certificate by AAG shall be deemed to be a
representation by AAG for the benefit of the Agent and IPG that, except as set
forth in such Allocation Certificate, (i) no Tranche E Event of Default or
Suspension Event has occurred and is continuing, (ii) the funds transferred
from the AAG Funds Account to the AAG Expense Account will only be applied to
repay advances by AACI to AAG which advances were utilized by AAG to pay
ordinary course reimbursable expenses as set forth on Schedule II to the Main
License, (iii) the funds being transferred to the LLC Funds Account from the
AAG Funds Account represent all monies due and owing to the LLC under the Main
License for such period and (iv) to the best knowledge of the Authorized
Officer signing such Allocation Certificate, the information set forth on such
Allocation Certificate is true, accurate and correct as of the date such
Allocation Certificate is provided. At the request of IPG, AAG shall provide
IPG with copies of any Allocation Certificate delivered to the Agent.
(c) On each Settlement Date, the Agent shall transfer such
funds from the AAG Account into the LLC Account or the AAG Expense Account, as
are indicated on the Allocation Certificate as LLC Funds or Expense Funds, as
the case may be, to be disbursed in accordance with the Allocation Certificate
and will disburse the funds from the LLC Account in accordance with the
Allocation Certificate, subject to Section 3 below. The Agent shall have no
liability to IPG or any other party hereto for transferring funds from the AAG
Account into the LLC Account or the AAG Expense Account, or disbursing the
funds contained in the LLC Account or the AAG Expense Account, in accordance
with the Allocation Certificate. In this regard, the Allocation Certificate
with respect to each Settlement Date shall indicate the following: (i) the
amount to be paid to the LLC for any Earn-Out Payments; (ii) the amount to be
paid to the LLC for any Operating Payment; (iii) the amount to be paid to the
LLC for any Tax Distribution; (iv) the amount to be paid to the LLC for any
Dividend Distribution; (v) the amount to be transferred to the AAG Expense
Account; and (vi) the amount due to the LLC under the Main License.
(d) Unless a Tranche E Event of Default has occurred and
is continuing, funds in the AAG Expense Account may be utilized by AAG at any
time to repay, and only to repay, advances by AACI to AAG which advances were
utilized to pay ordinary course reimbursable expenses as set forth on Schedule
II to the Main License.
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Section 3. Priority of Disbursements.
(a) Unless a Tranche E Event of Default has occurred and
is continuing, provided that the Allocation Certificate referred to in Section
2(b) hereof has been received and subject to Section 14 hereof, on the
Settlement Date the Agent shall make disbursements from the LLC Funds Account
in accordance with the Allocation Certificate in the following order:
First, to the LLC for any Earn-out Payments;
Second, to the LLC for any Operating Payment which shall not
in any event exceed $100,000 per annum;
Third, to the LLC for any Tax Distribution;
Fourth, to LLC for Dividend Distribution; and
Fifth, to Chemical for accrued and unpaid interest with
respect to the Senior Obligations.
All remaining funds in the AAG Funds Account shall be used to prepay the Senior
Obligations as provided in the Chemical Agreement until the Senior Obligations
have been paid in full.
(b) As long as the Senior Obligations remain outstanding,
as between the LLC and AAG, for purposes of the Main License, any funds
transferred by the Agent from the AAG Funds Account to the LLC Funds Account
shall be deemed to have been paid by AAG to the LLC and shall discharge the
obligations of AAG to the LLC under Section 18(a) of the Main License.
(c) As long as the Senior Obligations remain outstanding,
as between IPG on one hand and AACI and AAG on the other, for purposes of the
Operating Agreement, any funds withdrawn from the LLC Funds Account by the
Agent (other than funds withdrawn by the Agent to pay Earn-Out Payments) shall
be deemed to have been distributed to the All American Members pursuant to
Section 5.3 thereof.
Section 4. Interest. On the Final Closing Date, AACI shall
deposit into the Interest Reserve Account an amount equal to two months'
interest on the Tranche E Loan. So long as a Tranche E Event of Default shall
have not occurred and be continuing, and the Senior Obligations remain
outstanding, on the last Business Day of each month of each calendar quarter
(to the extent available after making any distributions pursuant to Section 3
herein), a portion of the AAG Funds and, to the extent necessary, a portion of
the LLC Funds, shall be deposited into the Interest Reserve Account in an
amount equal to one-third of the interest on the Tranche E Loan estimated to be
payable for
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such calendar quarter. On the Business Day prior to the Settlement Date for
such calendar quarter, amounts on deposit in the Interest Reserve Account to
the extent in excess of an amount equal to two months' interest on the Tranche
E Loan, shall be transferred to the LLC Funds Account for distribution in
accordance with item five above. In all cases, the amount to be held in the
Interest Reserve Account pursuant to this Section 4 shall be calculated by
applying the interest rate in effect on Eurodollar Loans (as defined in the
Chemical Agreement) on such date to the principal balance of the Tranche E Loan
as of the date of calculation. Funds held in the Interest Reserve Account may
be used by the Agent to pay interest when such payment is due on a date other
than a Settlement Date.
Section 5. Agreement to Subordinate.
(a) IPG agrees that the Guarantor Obligations are and shall
be subordinate and subject in right of payment, to the extent and in the manner
hereinafter set forth, to the prior payment in full of the Senior Obligations
and that any guarantees, security interests, mortgages and other liens securing
payment of the Guarantor Obligations, including but not limited to the
Guaranty, the Security Agreement and the Pledged Stock, are and shall be
subordinate, to the fullest extent permitted by law and as hereinafter set
forth, to the Senior Obligations, notwithstanding the perfection, order of
perfection or failure to perfect, any such security interest or other lien, or
the filing or recording, order of filing or recording, or failure to file or
record this Intercreditor Agreement or any instrument or other document in any
filing or recording office in any jurisdiction; provided, however, that except
as expressly set forth herein, nothing contained in this Intercreditor
Agreement shall affect or in any manner limit the ability of IPG to pursue all
remedies to which it is entitled pursuant to the Operating Agreement or the
Letter Agreement against AACI or any other Person other than the Guarantors or
against any assets of AACI in connection with the Parent Obligations.
(b) The Agent agrees that the Credit Obligations are and
shall be subordinate and subject in right of payment, to the extent and in the
manner hereinafter set forth, to the prior payment in full of the Guarantor
Obligations and that any guarantees, security interests, mortgages and other
liens on assets of the Guarantors or the Pledged Stock securing payment of the
Credit Obligations are and shall be subordinate, to the fullest extent
permitted by law and as hereinafter set forth, to the Guarantor Obligations,
notwithstanding the perfection, order of perfection or failure to perfect, any
such security interest or other lien, or the filing or recording, order of
filing or recording, or failure to file or record this Intercreditor Agreement
or any instrument or other document in any filing or
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recording office in any jurisdiction; provided, however, that nothing contained
in this Intercreditor Agreement shall affect or in any manner limit the ability
of the Agent and the Lenders to pursue all remedies to which they are entitled
pursuant to the Chemical Agreement or otherwise (i) against AACI or any other
Person other than the Guarantors, or (ii) against any assets of such Person,
other than the Pledged Stock.
Section 6. Additional Provisions Concerning Subordination.
A. So long as the Senior Obligations remain outstanding, IPG and the Obligors
each agree as to itself as follows:
(a) Each Guarantor agrees that it will not make any
payment of any of the Guarantor Obligations, or take any other action, in
contravention of the provisions of this Intercreditor Agreement.
(b) IPG and the Obligors will, at their own expense and at
any time and from time to time, promptly execute and deliver all further
instruments and documents, and take all further action that the Agent may
reasonably request, in order to perfect or otherwise protect any right or
interest granted or purported to be granted hereby or to enable the Agent to
exercise and enforce its rights and remedies hereunder. IPG further authorizes
the Agent, in the event IPG has not done so within a reasonable time, to file
UCC financing statements and any amendments thereto or continuations thereof
with regard to Guarantor Obligations on IPG's behalf without IPG's signature.
(c) IPG shall not exercise its remedies under either the
Pledge Agreement, the Guaranties or the Security Agreement with respect to, or
otherwise take any action to seize, realize upon or foreclose upon any item of
the IPG Collateral unless and until (i) a default as defined in the Pledge
Agreement or a default as defined in the Guaranties or Security Agreement, as
the case may be, giving rise to the right to exercise such remedies under such
agreement shall have remained uncured or unremedied for 12 months from the date
of notice to the Agent of the occurrence and the Agent has not (A) declared the
Senior Obligations to be immediately due and payable and (B) actively pursued
the rights of the Agent and the Lenders under the Chemical Agreement in
connection therewith or (ii) the Agent has agreed to waive the provisions of
this Section 6(c). Nothing herein shall restrict the rights of IPG (A) to take
actions to protect and preserve the validity, perfection and priority of any of
its security interests in a manner not inconsistent with the terms of this
Intercreditor Agreement (including, without limitation, actions taken to
preserve and protect IPG Collateral), (B) to establish and defend the status of
its claims as secured claims in connection with the Guarantor Obligations in
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a manner not prejudicial to the right of the Agent pursuant to the terms of
this Intercreditor Agreement, (C) to appear and be heard on any matter arising
in a bankruptcy, insolvency or receivership proceeding, (D) subject to Section
10(f), to vote as it may elect in its sole discretion in connection with any
proposed Chapter 11 plan, or (E) to seek any form of adequate protection of its
interest in any IPG Collateral or other similar relief not prejudicial to the
right of the Agent pursuant to the terms of this Intercreditor Agreement in any
bankruptcy, insolvency or receivership proceeding and to receive payment of IPG
Collateral proceeds under any form of adequate protection or postpetition
lending arrangement; provided, however, that all proceeds or payments received
by IPG in connection with the IPG Collateral and/or the Pledged Stock (as shall
equal the amount of the Senior Obligations) shall be deemed to be the property
of the Lenders and shall otherwise be subject to the provisions of Section 7
below.
(d) In the event of (i) any dissolution, winding up,
liquidation or reorganization of any Guarantor (whether voluntary or
involuntary and whether in bankruptcy, insolvency or receivership proceedings,
or upon an assignment for the benefit of creditors or proceedings for voluntary
or involuntary liquidation, dissolution or other winding up of any Obligor,
whether or not involving insolvency or bankruptcy, or any other marshalling of
the assets and liabilities of any Obligor or otherwise); or (ii) the occurrence
and continuation of a Tranche E Event of Default, or any default or demand for
payment regarding the Guarantor Obligations:
(1) all Senior Obligations shall first be paid to
the Agent for the benefit of the Lenders in full before any
payment or distribution is made on or any fees, costs, charges
or expenses in connection with the Guarantor Obligations, and
before any other action described in Section 10(a) hereof is
taken by IPG; and
(2) any payment or distribution of assets of any
Guarantor whether in cash, property or securities to which IPG
would be entitled except for the provisions hereof, shall be
paid or delivered by such Guarantor, or any receiver, trustee
in bankruptcy, liquidating trustee, disbursing agent, agent or
other person making such payment or distribution, directly to
the Agent for the benefit of the Lenders, to the extent
necessary to pay in full all Senior Obligations remaining
unpaid, before any payment or distribution is made to IPG.
(e) In any proceeding referred to or resulting from any event
referred to in subsection (d) of this Section 6 commenced by or against any
Guarantor:
- 14 -
15
(1) The Agent may, and is hereby irrevocably authorized
and empowered (in its own name or in the name of IPG
or otherwise), but shall have no obligation to, (i)
demand, xxx for, collect and receive every payment or
distribution referred to in subsection (d) of this
Section 6 and give acquittance therefor, (ii) file
claims and proofs of claim in respect of the Guarantor
Obligations and (iii) take such other action as the
Agent may deem necessary or advisable for the exercise
or enforcement of any of the rights or interests of
the Agent and the Lenders hereunder; and
(2) IPG will duly and promptly take such action as the
Agent may reasonably request to collect the Guarantor
Obligations for the account of the Lenders and to file
appropriate claims or proofs of claim with respect
thereto, to execute and deliver to the Agent such
powers of attorney, assignments or other instruments
as the Agent may request in order to enable it to
enforce any and all claims with respect to the
Guarantor Obligations, and to collect and receive any
and all payments or distributions which may be payable
or deliverable upon or with respect to the Guarantor
Obligations.
B. So long as the Senior Obligations have been paid in
full and the Guarantor Obligations remain outstanding, the Agent and the
Guarantors each agree as to itself as follows:
(a) Each Guarantor agrees that it will not make any
payment of any of the Credit Obligations, or take any other action, in
contravention of the provisions of this Intercreditor Agreement.
(b) The Agent and the Guarantors will, at their own
expense and at any time and from time to time, promptly execute and deliver all
further instruments and documents, and take all further action that IPG may
reasonably request, in order to perfect or otherwise protect any right or
interest granted or purported to be granted hereby or to enable IPG to exercise
and enforce its rights and remedies hereunder.
(c) Each of the Agent and the Lenders shall not exercise
its remedies under the Chemical Agreement with respect to, or otherwise take
any action to foreclose upon, any item of the Tranche E Collateral unless and
until (i) a Tranche E Event of Default giving rise to the right to exercise
such remedies under such agreement shall have remained uncured or unremedied
for 12 months from the date of the occurrence of such Event of
- 15 -
16
Default and IPG has not (A) declared the Guarantor Obligations to be
immediately due and payable and (B) actively pursued its rights under the IPG
Obligation Documents in connection therewith or (ii) IPG has agreed to waive
the provisions of this Section 6B(c). Nothing hereunder shall restrict the
rights of the Agent or the Lenders (A) to take actions to protect and preserve
the validity, perfection and priority of any of its security interests in a
manner not inconsistent with the terms of this Intercreditor Agreement
(including, without limitation, actions taken to preserve and protect Tranche E
Collateral), (B) to establish and defend the status of its claims as secured
Credit Obligation claims in a manner not prejudicial to the rights of IPG
pursuant to the terms of this Intercreditor Agreement, (C) to appear and be
heard on any manner arising in a bankruptcy, insolvency or receivership
proceeding, (D) subject to Section 12(c), to vote as it may elect in its sole
discretion in connection with any proposed Chapter 11 plan, or (E) to seek any
form of adequate protection of its interest in any Tranche E Collateral or
other similar relief not prejudicial to the rights of IPG pursuant to the terms
of this Intercreditor Agreement in any bankruptcy, insolvency or receivership
proceeding and to receive payment of Tranche E Collateral proceeds under any
form of adequate protection or postpetition lending arrangement; provided,
however, that all proceeds or payments received by the Agent in connection with
the Tranche E Collateral and/or the Pledged Stock (as shall equal the amount of
the Guarantor Obligations) shall be deemed to be the property of IPG and shall
otherwise be subject to the provisions of Section 7 below.
(d) In the event of (i) any dissolution, winding up,
liquidation or reorganization of any Guarantor (whether voluntary or
involuntary and whether in bankruptcy, insolvency or receivership proceedings,
or upon an assignment for the benefit of creditors or proceedings for voluntary
or involuntary liquidation, dissolution or other winding up of any Guarantor,
whether or not involving insolvency or bankruptcy, or any other marshaling of
the assets and liabilities of any Guarantor or otherwise); or (ii) any default
or demand for payment regarding the Credit Obligations:
(1) all Guarantor Obligations shall first be paid to IPG
in full before any payment or distribution is made on
or any fees, costs, charges or expenses in connection
with the Credit Obligations, and before any other
action described in Section 10(a) hereof is taken by
the Agent or any Lender; and
(2) any payment or distribution of assets of any Guarantor
whether in cash, property or securities to which the
Agent or the Lenders would be entitled except for the
provisions hereof, shall
- 16 -
17
be paid or delivered by such Guarantor, or any
receiver, trustee in bankruptcy, liquidating trustee,
disbursing agent, agent or other person making such
payment or distribution, directly to IPG, to the
extent necessary to pay all Guarantor Obligations
remaining unpaid after giving effect to any concurrent
payment of distribution to IPG before any payment or
distribution is made to the Agent or any Lender.
(e) In any proceeding referred to or resulting from any
event referred to in subsection (d) of this Section 6B commenced by or against
any Guarantor:
(1) IPG may, and is hereby irrevocably authorized and
empowered (in its own name or in the name of the
Agent, any Lender or otherwise), but shall have no
obligation to, (i) demand, xxx for, collect and
receive every payment or distribution referred to in
subsection (d) of this Section 6B and give acquittance
therefor, (ii) file claims and proofs of claims in
respect of the Credit Obligations and (iii) take such
other action as IPG may deem necessary or advisable
for the exercise or enforcement of any of the rights
or interests of IPG hereunder; and
(2) The Agent will duly and promptly take such action as
IPG may reasonably request to collect the Credit
Obligations for the account of IPG and to file
appropriate claims or proofs of claim with respect
thereto, to execute and deliver to IPG such powers of
attorney, assignments or other instruments as IPG may
request in order to enable it to enforce any and all
claims with respect to the Credit Obligations, and to
collect and receive any and all payments or
distributions which may be payable or deliverable upon
or with respect to the Credit Obligations.
Section 7. Receipt of Payments and Trust. (a) All payments
or distributions upon or with respect to the Guarantor Obligations which are
received by IPG contrary to the provisions of this Intercreditor Agreement
shall be deemed to be the property of the Lenders, shall be received in trust
for the benefit of the Lenders, shall be segregated from other funds and
property held by IPG and shall be forthwith paid over to the Agent for the
benefit of the Lenders in the same form as so received (with any necessary
endorsement) to be applied to the payment or prepayment of the Senior
Obligations until the Senior Obligations shall have been paid in full.
- 17 -
18
(b) All payments or distributions upon or with respect to
the Credit Obligations which are received by the Agent or the Lenders contrary
to the provisions of this Intercreditor Agreement shall be deemed to be the
property of IPG, shall be received in trust for the benefit of IPG, shall be
segregated from other funds and property held by the Agent or the Lenders and
shall be forthwith paid over to IPG in the same form as so received (with any
necessary endorsement) to be applied to the payment of the Guarantor
Obligations until the Guarantor Obligations shall have been paid in full.
Section 8. No Action.
(a) IPG and the Agent each agree not to contest, or bring
or cause (or voluntarily join in) any action or proceeding for the purpose of
contesting the validity, perfection or priority (as herein provided) of, or
seek to avoid, either the Agent's or the Lenders' Lien in any collateral
securing the Chemical Obligations or IPG's Lien in any item of IPG Collateral,
as the case may be; provided, however, that nothing herein shall be deemed or
construed to prevent either the Agent or IPG, as the case may be, from
commencing an action or proceeding against the Agent, a Lender or IPG, as the
case may be, to assert any right or claim it may have to enforce this
Intercreditor Agreement.
(b) Notwithstanding anything in this Agreement or any
Senior Obligation Document to the contrary, so long as the Guarantor
Obligations remain outstanding, unless a Tranche E Event of Default shall have
occurred and is continuing, neither the Agent nor any Lender shall initiate,
prosecute or participate in any action to, or take any steps to (whether
administrative, legal, equitable or any other nature whatsoever), (i) enforce,
foreclose, seize, setoff or realize upon the Tranche E Collateral or (ii)
commence any proceeding involving any Guarantor referred to in subsection (c)
of Section 3 hereof, provided that notwithstanding clause (ii) herein, if a
bankruptcy petition has been filed by another person with respect to such
Guarantor the Agent and the Lenders may fully participate in such bankruptcy
proceeding and exercise, subject to the terms of this Agreement, their
respective rights against such Guarantor and/or its assets.
(c) So long as the Senior Obligations are outstanding, IPG
hereby waives any requirement for marshalling of assets by the Agent in
connection with any foreclosure of any lien of the Lenders under the Chemical
Agreement with regard to the Senior Obligations and the Agent, hereby waives
any requirement for marshalling of assets by IPG in connection with any
foreclosure of any Lien of IPG under the IPG Obligation Documents with regard
to the Guarantor Obligations;
- 18 -
19
(d) The Agent and IPG are hereby authorized to demand
specific performance of this Intercreditor Agreement at any time when (i) any
Obligor or (ii) either IPG or the Agent, as the case may be, shall have failed
to comply with any of the provisions of this Intercreditor Agreement, and all
of such parties hereby irrevocably waive any defense based on the adequacy of a
remedy at law which might be asserted as a bar to such remedy of specific
performance; and
(e) IPG hereby agrees that it shall not take any action
against any Guarantor to enforce its rights under the IPG Obligation Documents
in connection with the Guarantor Obligations in the event of a Change in
Ownership (as defined in the Operating Agreement) for a period of five Business
Days after IPG has notified the Agent that a Change in Ownership has occurred
and that it has made demand on a Guarantor in connection therewith.
Section 9. Representations and Warranties.
(a) IPG and AAG each hereby represent and warrant for
itself that attached hereto as Schedule B is a true, correct and complete copy
of the Operating Agreement.
Section 10. Negative Covenants. Subject to Section 3(b), so
long as any of the Senior Obligations shall remain outstanding, IPG will not,
without the prior written consent of the Agent:
(a) Xxx for, take or receive, directly or indirectly, from
the Guarantor, in cash or other property, by setoff, by realizing upon
collateral, foreclosing on any lien or otherwise, by exercise of any remedies
or rights under the IPG Obligation Documents or by executions, garnishments,
levies, attachments or by any other action relating to the Guarantor
Obligations, or in any other manner, payment of, or additional security for,
all or any part of the Guarantor Obligations unless and until the Senior
Obligations shall have been paid in full.
(b) Sell, assign, pledge, encumber or otherwise dispose of
any instrument evidencing the indebtedness owed to IPG or any collateral
securing the Guarantor Obligations unless such sale, assignment, pledge,
encumbrance or other disposition is made expressly subject to this
Intercreditor Agreement and the other party to such sale, assignment, pledge,
encumbrance or other disposition consents in writing to be bound by the terms
hereof;
(c) Permit the terms of the IPG Obligation Documents or
collateral securing any Guarantor Obligations to be changed in any way which
would limit or impair these subordination
- 19 -
20
provisions, increase the principal amount thereof, increase the interest
payable thereon, change any payment date thereunder or accept any collateral;
(d) Realize upon, or otherwise exercise any remedies with
respect to, any IPG Collateral;
(e) Commence, or join with any creditor other than the
Lenders in commencing any proceeding involving any Guarantor referred to in
subsection (c) of Section 3 hereof; or
(f) In connection with any Chapter 11 plan relating to any
of the Tranche E Collateral, including but not limited to the Main License,
without the prior consent of the Agent, vote for any plan which does not
provide for the Main License to be assumed.
Section 11. Obligations Unconditional. All rights,
interests, and all agreements and obligations of the parties hereto, shall
remain in full force and effect irrespective of:
(a) Any lack of validity or enforceability of any Senior
Obligation Document, IPG Obligation Document or any other agreement or
instrument relating thereto;
(b) Any change in the time, manner or place of payment of,
or in any other term of, all or any of the Senior Obligations, Parent
Obligations or Guarantor Obligations, or any other amendment or waiver of or
any consent to departure from any Senior Obligation Document or any IPG
Obligation Document;
(c) Any exchange, release or nonperfection of any
collateral, or any release or amendment or waiver of or consent to departure
from any guaranty, for all or any of the Senior Obligations or Guarantor
Obligations; or
(d) Any other circumstances which might otherwise
constitute a defense available to, or a discharge of, either any Guarantor in
respect of the Senior Obligations or the Guarantor Obligations or of IPG or
the Agent or any Obligor in respect of this Intercreditor Agreement.
Section 12. Additional Agreements and Waivers. (a) So long
as the Senior Obligations remain outstanding, IPG agrees that in connection
with any Guarantor Obligations neither the Agent nor any Lender shall have any
liability or obligation to IPG on account of the exercise of the rights and
remedies of the Agent and/or the Lenders under any Senior Obligation Document
or this Agreement (except, with respect to this Agreement, any breach by such
party of this Agreement).
- 20 -
21
(b) So long as the Guarantor Obligations remain
outstanding, the Agent agrees that, in connection with any Credit Obligations,
IPG shall not have any liability or obligation to the Agent on account of
exercise against any Guarantor of the rights and remedies of IPG under any IPG
Obligation Document or this Agreement (except, with respect to this Agreement,
any breach by such party of this Agreement).
(c) The Agent hereby agrees that in the event the Agent
(on behalf of the Lenders) through exercise of its remedies in connection with
the Chemical Obligations, acquires the membership interest of AACI or AAG in
the LLC and takes any action to exercise rights as a member thereof, its
actions shall be subject to Section 3.3(c) of the Operating Agreement.
(d) So long as any Guarantor Obligation remains
outstanding, the Agent hereby agrees that it will not make, support or join in
any motion or otherwise seek a substantive consolidation of any Guarantor in
connection with any such proceeding referred to in Section 3(c) involving AACI
and/or any of its subsidiaries.
(e) So long as any Chemical Obligation remains
outstanding, IPG hereby agrees that it will not make, support or join in any
motion or otherwise seek a substantive consolidation of any Guarantor in
connection with any proceeding referred to in Section 3(c) involving AACI
and/or any of its subsidiaries.
Section 13. Suspension of Certain Disbursements.
(a) In the event International Cash Flow on a cumulative
basis is less than (A) the amounts indicated below in column (y) for the
quarter ending on the date indicated below in column (x), All American Members
shall not be entitled to receive a Tax Distribution for such quarter and (B)
the amounts indicated below in column (z) for the quarter ending on the date
indicated below in column (x), Interpublic Members shall not be entitled to
receive a Tax Distribution nor Dividend Distribution for such period and the
disbursements referred to in items third and fourth of Section 3 shall be
adjusted accordingly (in each case, a "Suspension Event"):
(x) (y) (z)
12/31/95 $ 1.2 Million $ 1.0 Million
03/31/96 3.0 Million 2.5 Million
06/30/96 4.0 Million 3.5 Million
09/30/96 6.0 Million 5.5 Million
12/31/96 8.0 Million 7.0 Million
03/31/97 9.5 Million 8.5 Million
06/30/97 11.5 Million 10.0 Million
09/30/97 13.0 Million 11.5 Million
- 21 -
22
12/31/97 15.0 Million 13.5 Million
03/31/98 16.5 Million 14.5 Million
06/30/98 19.0 Million 16.5 Million
09/30/98 20.0 Million 18.0 Million
12/31/98 22.0 Million 19.5 Million
(b) Notwithstanding clause (a) above, if a Suspension
Event has occurred, in the event the outstanding balance of the Tranche E Loan
as of the date indicated below in column (x) is equal or less than the amount
indicated below in column (y) at such time, the All American Members may
receive a Tax Distribution for such quarter and the Interpublic Members may
receive a Tax Distribution and Dividend Distribution for such quarter:
(x) (y)
12/31/96 $21,700,000
12/31/97 17,800,000
12/31/98 12,700,000
(c) AAG hereby agrees that, so long as a Suspension Event
has occurred and is continuing, AAG shall not indicate on any Allocation
Certificate thereafter any Tax Distribution or Dividend Distribution until the
Agent has notified the LLC that a Suspension Event no longer exists. In
addition, the LLC hereby agrees not to make any Tax Distribution or Dividend
Distribution other than from funds disbursed for such purpose by the Agent from
the LLC Account.
Section 14. Tranche E Default.
(a) Upon the occurrence and during the continuation of a
Tranche E Event of Default, the Agent shall have the right to withdraw first,
all funds then held in the AAG Account; second, all funds then held in the AAG
Expense Account and third, all LLC Funds then held in the LLC Funds Account
(other than funds held as Earn-Out Payments) to be applied against the
outstanding Senior Obligations.
(b) Upon the occurrence and during the continuation of a
Tranche E Event of Default, the Agent shall be entitled to pursue all remedies
provided to the Agent or the Lenders pursuant to the terms of the Chemical
Agreement subject to this Intercreditor Agreement, including, but not limited
to, taking such action as may be necessary to realize upon any of the assets of
the Obligors including the Cash Collateral Accounts.
Section 15. Exercise of IPG Rights. Upon payment in full of
the Senior Obligations, nothing contained herein shall prohibit IPG from
exercising all of its rights and pursue any
- 22 -
23
remedies provided to it in connection with the Guarantor Obligations pursuant
to the IPG Obligation Documents.
Section 16. Pledged Stock. Upon payment in full of the
Senior Obligations, the Agent shall deliver to Interpublic the certificates
representing the Pledged Stock which have been delivered previously to the
Agent as a secured party with respect to the Chemical Obligations to be held
thereafter by Interpublic as a secured party with respect to the Parent
Obligations. The parties (including the Obligors) hereby acknowledge that at
such time IPG shall have a senior lien on such Pledged Stock and shall
thereafter hold such Pledged Stock subject to a junior lien of the Agent
securing the Credit Obligations of AACI and AAG.
Section 17. Amendments to Documents, etc.
(a) So long as the Senior Obligations remain outstanding,
IPG and LLC each agree that, without the prior written consent of the Agent,
they will not permit any modification or amendment to the Asset Purchase
Agreement which could reasonably be expected to increase the Earn Out Payment
amounts payable thereunder, or accelerate the time when any Earn Out payments
are to be made.
(b) IPG and the Obligors each agree that, without the
prior written consent of the Agent, they will not permit any modifications or
amendment to any IPG Obligation Documents which would provide any additional
security for any obligation of any Guarantor to IPG, provide any security for
any Parent Obligation, or otherwise materially adversely affect the value of
the Tranche E Collateral or the rights or interest of the Agent and the Lenders
under the Chemical Agreement as supplemented and amended by this Intercreditor
Agreement.
(c) So long as the Senior Obligations remain outstanding,
IPG and AACI each agree that, without the prior written consent of the Agent
(i) they will not amend (A) the provisions of Section 4.2.1 or any other
provision of the Operating Agreement which would alter the provisions relating
to the distribution of LLC Funds (including, but not limited to Section 5.3),
the definition of Make Whole Default; (ii) permit any other modification of the
Operating Agreement which would materially adversely affect the rights or
interest of the Agent and the Lenders under the Chemical Agreement as
supplemented and amended by this Intercreditor Agreement or (iii) permit the
LLC to distribute or to agree to distribute LLC funds other than as provided
for in the Operating Agreement subject to the terms of this Intercreditor
Agreement.
(d) AACI, AAG and the Agent each agree that, without the
prior written consent of IPG and the LLC, they will not
- 23 -
24
permit any modification or amendment to the Chemical Agreement which would
increase the principal amount of the Tranche E Loan, increase the interest rate
therein, change the date of maturity thereof, increase the amount of the Senior
Obligations or provide additional security from the Guarantors therefor.
(e) AACI, the LLC and IPG each agree that it will not
provide the joint instructions required by Section 2 of the Escrow Agreement
unless each condition precedent to the Final Closing has been satisfied or
waived; provided, however, that any such waiver shall require the prior consent
of the Agent.
(f) The LLC and AAG each agree that, notwithstanding
Section 24 of the Main License, until such time as the Senior Obligations shall
have been paid in full, the Main License may not be terminated for any reason.
In the event that following the occurrence and continuation of a Tranche E
Event of Default, the Agent exercises its rights pursuant to Article 8 of the
Chemical Agreement, the LLC hereby agrees that the Agent may whether by
judicial sale or private sale or otherwise, cause AAG's right, title and
interest in and to the Main License to be transferred to a third party and such
third party shall thereafter for all intents and purposes be deemed to be the
Licensee under the Main License. In addition, any breach by AAG of its
obligations under the Main License existing at the time of such transfer which
would otherwise entitle the LLC to terminate the Main License, whether pursuant
to Section 24 of the Main License or otherwise, shall be deemed cured upon such
transfer. Notwithstanding the foregoing, however, such third party shall
thereafter be subject to all terms and conditions of the Main License including
but not limited to Section 24. The Agent hereby agrees that the proceeds from
such sale or other disposition shall be utilized to reduce the outstanding
Senior Obligations and any excess shall be delivered to IPG to be applied to
reduce the Guarantor Obligations.
Section 18. Duration of Agreement.
(a) The disbursement procedures contained in Sections 2
and 3 shall remain in effect until the Senior Obligations have been paid in
full. The parties hereto hereby agree that after the Senior Obligations have
been paid in full, the procedures set forth in the Security Agreement shall
apply to the disbursement of funds in connection with the subject matter hereof.
(b) This Intercreditor Agreement shall remain in effect
until the earlier of such time as the Guarantor Obligations have been paid in
full or the Chemical Obligations have been paid in full.
- 24 -
25
Section 19. Expenses. The Obligors agree to pay to the Agent
and IPG, upon demand, the amount of any and all reasonable expenses, including
the reasonable fees and expenses of counsel for the Agent, which the Agent or
IPG may incur in connection with the exercise or enforcement of any of the
rights or interests of the Agent, the Lenders or IPG, as the case may be,
hereunder. In addition, AACI hereby agrees to pay to the Agent on or prior to
the Final Closing Date all fees and expenses which have been incurred by the
Agent as of such date in connection with the preparation, negotiation and the
entering into of the Tranche E Loan and this Intercreditor Agreement,
including, but not limited to, reasonable fees and expenses of counsel for the
Agent.
Section 20. Miscellaneous.
(a) After payment in full of the Senior Obligations,
Section 10 herein shall apply mutatis mutandis as if IPG were the Agent and the
Lenders and the Agent and the Lenders were IPG and any reference therein to
"Senior Obligations" shall mean "Guarantor Obligations" and any reference to
"IPG Obligation Documents" shall mean "Senior Obligation Documents".
(b) All notices and other communications provided for
herein shall be by telex, telecopy, telegraph, cable or in writing, shall be
deemed to have been duly given when received and shall be sent to the addresses
provided on the signature pages hereto.
(c) This Intercreditor Agreement may be modified or waived
only by an instrument or instruments in writing signed by all the parties
hereto.
(d) This Intercreditor Agreement shall be binding upon and
inure to the benefit of the Agent, AACI, IPG, LLC, AAG, AAFII and AATII and
their respective successors and assigns.
(e) This Intercreditor Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and
the same instrument and any of the parties hereto may execute this
Intercreditor Agreement by signing any such counterpart.
(f) Section headings used herein are for convenience only
and shall not affect the construction or interpretation of this Intercreditor
Agreement.
(g) This Intercreditor Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
- 25 -
26
IN WITNESS WHEREOF, the parties hereby have caused this
Intercreditor Agreement to be duly executed as of the date first written above.
THE INTERPUBLIC GROUP
OF COMPANIES, INC.
By /s/ Xxxxxx X. Xxxxx
------------------------------------
Title: Sr. Vice President-
Financial Opers.
Address: 1271 Ave. of the Americas
Xxx Xxxx, XX 00000
XXXX XXXXXXX PRODUCTIONS, LLC
By /s/ Xxxxxx Xxxxxxxx
------------------------------------
Title: C.F.O.
Address: 1325 Ave. of the Americas
Xxx Xxxx, XX 00000
ALL AMERICAN XXXXXXX, INC.
By /s/ Xxxxxx Xxxxxxxx
------------------------------------
Title: C.F.O.
Address: 1325 Ave. of the Americas
Xxx Xxxx, XX 00000
ALL AMERICAN COMMUNICATIONS, INC.
By /s/ Xxxxxx Xxxxxxxx
------------------------------------
Title: C.F.O.
Address: 1325 Ave. of the Americas
Xxx Xxxx, XX 00000
ALL AMERICAN FREMANTLE II, INC.
By /s/ Xxxxxx Xxxxxxxx
------------------------------------
Title: C.F.O.
Address: 1325 Ave. of the Americas
Xxx Xxxx, XX 00000
27
ALL AMERICAN TELEVISION II, INC.
By /s/ Xxxxxx Xxxxxxxx
------------------------------------
Title: C.F.O.
Address: 1325 Ave. of the Americas
Xxx Xxxx, XX 00000
CHEMICAL BANK, as Agent
By /s/ Xxxx X. Xxxxx
------------------------------------
Title: Managing Director
Address: 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
28
Exhibit A
ALLOCATION CERTIFICATE
This certificate is delivered to Chemical Bank in connection
with Section 2 of the Intercreditor Agreement (the "Intercreditor Agreement")
dated as of October 6, 1995 among (i) Chemical Bank as Agent, (ii) The
Interpublic Group of Companies, Inc., (iii) All American Xxxxxxx, Inc., a
wholly owned subsidiary of All American Communications Inc., (iv) All American
Communications, Inc., (v) All American Fremantle II, Inc., a wholly owned
subsidiary of All American Fremantle, Inc., (vi) All American Television II,
Inc., a wholly owned subsidiary of All American Television Inc. and (vi) Xxxx
Xxxxxxx Productions, LLC. All capitalized terms used herein and not otherwise
defined are used as defined in the Intercreditor Agreement.
The undersigned hereby certifies the following information in
connection with the disbursement of funds from the AAG Funds Account in
connection with disbursements to be made on __________, 199_, the Settlement
Date:
1. Earn-Out Payments $_____________
2. Operating Payment $_____________
3. Tax Distribution $_____________
4. Dividend Distribution $_____________
5. AAG Expense Account $_____________
6. Main License Agreement --
amount due to LLC $_____________
ALL AMERICAN XXXXXXX INC.
Dated: __________, 199_ By:_______________________________
Name:
Title:
