1
EXHIBIT 10.25
INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT
This INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT (this
"Agreement") is dated as of November 10, 1997, and entered into by BT
COMMERCIAL CORPORATION, as administrative agent (in such capacity, the
"Revolving Agent") for the lenders under the Credit Agreement referred to
below, BANKERS TRUST COMPANY, as agent (in such capacity, the "Bridge Agent")
for the lenders under the Senior Secured Credit Agreement referred to below,
BANKERS TRUST COMPANY, as collateral agent (in such capacity, the "Collateral
Agent") under the Pledge Agreements referred to below, and FWT, INC., a Texas
corporation (the "Borrower").
PRELIMINARY STATEMENTS
A. The Borrower, the several lenders from time to time
parties thereto (the "Revolving Lenders") and the Revolving Agent, have entered
into a Credit Agreement dated as of the date hereof, pursuant to which the
Revolving Lenders have made certain commitments, subject to the terms and
conditions set forth in the Credit Agreement, to extend certain credit
facilities to the Borrower.
B. The Borrower, the several lenders from time to time
parties thereto (the "Bridge Lenders"; the Bridge Lenders, the Revolving
Lenders, the Bridge Agent, the Revolving Agent and the Collateral Agent are
sometimes hereinafter collectively referred to as the "Secured Parties") and
the Bridge Agent have entered into a Senior Secured Credit Agreement dated as
of the date hereof, pursuant to which the Bridge Lenders have made certain
commitments, subject to the terms and conditions set forth in the Senior
Secured Credit Agreement, to extend certain credit facilities to the Borrower,
involving the Bridge Loans, the Term Loans, and Exchange Notes (each as defined
in the Senior Secured Credit Agreement).
C. As required by the Credit Agreement, the Borrower has
executed and delivered in favor of the Revolving Agent for the benefit of the
Revolving Lenders that certain Company Security Agreement dated as of the date
hereof (said agreement, as it may hereafter be amended, restated or otherwise
modified from time to time, being the "Revolving Borrower Security Agreement")
granting to Revolving Agent a security interest in all the personal property of
Borrower (the "Revolving Borrower Personal Property Collateral").
D. As required by the Senior Secured Credit Agreement,
the Borrower has executed and delivered in favor of the Bridge Agent for the
benefit of the Bridge Lenders that certain Company Security Agreement dated as
of the date hereof (said agreement, as it may hereafter be amended, restated or
otherwise modified from time to
2
time, being the "Bridge Borrower Security Agreement") granting to Bridge Agent
a security interest in all the personal property of Borrower other than the
inventory, the accounts receivable and the general intangibles (including
without limitation, intellectual property) of Borrower (the "Bridge Borrower
Personal Property Collateral").
E. The Credit Agreement requires that each future
Subsidiary of the Borrower that is a Guarantor execute and deliver in favor of
the Revolving Agent for the benefit of the Revolving Lenders a security
agreement in the form required by such Credit Agreement (said agreement, as it
may be amended, restated or otherwise modified from time to time, being a
"Revolving Subsidiary Security Agreement") granting to Revolving Agent a
security interest in all the personal property of such Subsidiary (the
"Revolving Subsidiary Personal Property Collateral"; the Revolving Borrower
Security Agreement and the Revolving Subsidiary Security Agreement being herein
collectively referred to as the "Revolving Security Agreements" and the
Revolving Borrower Personal Property Collateral and the Revolving Subsidiary
Personal Property Collateral being herein collectively referred to as the
"Revolving Personal Property Collateral").
F. The Senior Secured Credit Agreement requires that
each future Subsidiary of the Borrower that is a Guarantor execute and deliver
in favor of the Bridge Agent for the benefit of the Bridge Lenders a security
agreement in the form required by such Senior Secured Credit Agreement (said
agreement, as it may be amended, restated or otherwise modified from time to
time, being a "Bridge Subsidiary Security Agreement") granting to Bridge Agent
a security interest in all the personal property of such Subsidiary other than
the inventory, the accounts receivable and the general intangibles (including
without limitation, the intellectual property) of such Subsidiary (the "Bridge
Subsidiary Personal Property Collateral"; the Bridge Borrower Security
Agreement and the Bridge Subsidiary Security Agreement being herein
collectively referred to as the "Bridge Security Agreements" and the Bridge
Borrower Personal Property Collateral and the Bridge Subsidiary Personal
Property Collateral being herein collectively referred to as the "Bridge
Personal Property Collateral").
G. Each of the Credit Agreement and the Senior Secured
Credit Agreement requires that upon acquisition of the stock of a Subsidiary,
the Borrower execute and deliver in favor of the Collateral Agent for the
benefit of the Secured Parties a pledge agreement in the form required by such
Credit Agreement and such Senior Secured Credit Agreement (said agreement, as
it may be amended, restated or otherwise modified from time to time, being a
"Borrower Pledge Agreement") granting to Collateral Agent a security interest
in all of the shares of stock of Borrower's Subsidiaries held by Borrower (the
"Borrower Stock Collateral").
H. Each of the Credit Agreement and the Senior Secured
Credit Agreement requires that each future Subsidiary of the Borrower that is a
Guarantor execute and deliver in favor of the Collateral Agent for the benefit
of the Secured Parties a pledge agreement in the form required by such Credit
Agreement and such Senior Secured Credit Agreement (such agreement, as it may
be amended, restated or otherwise modified
2
3
from time to time, being a "Subsidiary Pledge Agreement") granting to
Collateral Agent a security interest in all of the shares of stock of
Borrower's indirect Subsidiaries held by such Subsidiary (the "Subsidiary Stock
Collateral"; the Borrower Pledge Agreement and the Subsidiary Pledge Agreement
being herein collectively referred to as the "Pledge Agreements"; the Borrower
Stock Collateral and the Subsidiary Stock Collateral being herein collectively
referred to as the "Stock Collateral"; the Pledge Agreements, the Revolving
Security Agreements and the Bridge Security Agreements being herein
collectively referred to as the "Collateral Documents"; and the Stock
Collateral, the Revolving Personal Property Collateral and the Bridge Personal
Property Collateral being herein collectively referred to as the "Collateral").
I. The Revolving Agent, the Bridge Agent and the
Collateral Agent desire to set forth their agreement as to the relative
priority of their respective security interests in the Collateral, as to the
manner of sharing amounts received from exercise of their rights with respect
to the Collateral and as to the exercise of remedies under the Collateral
Documents.
J. The parties hereto desire to set forth certain
provisions regarding the appointment, duties and responsibilities of the
Collateral Agent.
NOW, THEREFORE, the parties party hereto agree as follows:
Section 1. Intercreditor Arrangements.
A. Priority. Irrespective of any statement contained in
the Collateral Documents and irrespective of the time, order or method of
attachment or perfection of the security interests granted thereby, the
security interests in the Collateral created by the Collateral Documents in
favor of the Bridge Agent and the Bridge Lenders shall have priority to the
extent set forth herein over the security interests in the Collateral created
by the Collateral Documents in favor of the Revolving Agent and the Revolving
Lenders.
B. Extent of Priority. The proceeds in respect of any
Collateral, whether in the form of cash, securities, insurance proceeds, in
kind or otherwise, shall first be distributed to or set aside for the Bridge
Agent for the benefit of the Bridge Lenders in an amount equal to the aggregate
amount owed to the Bridge Agent and the Bridge Lenders under the Senior Secured
Credit Agreement. Any proceeds in excess of such amount shall then be
distributed to or set aside for the Revolving Agent for the benefit of the
Revolving Lenders in an amount equal to the aggregate amount owed to the
Revolving Lenders and the Revolving Agent under the Credit Agreement.
C. Enforcement of Remedies. Bridge Agent and Revolving
Agent agree to give notice to the other and to the Collateral Agent of the
acceleration or demand for payment of any amounts due under the Credit
Agreement, the Senior Secured Credit Agreement and the Collateral Documents, as
the case may be. With respect to the Bridge Security Agreements and the
Revolving Security Agreements, each of the Bridge Agent and
3
4
Revolving Agent may, without the consent of the other or of the Collateral
Agent, proceed to enforce against the Borrower, the Borrower's Subsidiaries or
the Collateral any right or remedy which is available to it under such
Collateral Documents; provided, however, that it shall give five Business Days
prior written notice of such action to the other unless it determines in good
faith that immediate action is necessary to protect the Collateral, in which
case such notice may be given contemporaneously with the taking of such action.
With respect to the Pledge Agreements, the Collateral Agent may, without the
consent of the other Secured Parties, proceed to enforce against the Borrower,
the Borrower's Subsidiaries or the Collateral any right or remedy which is
available to it under such Collateral Documents upon the direction of the
Revolving Lenders holding a majority of the Revolving Loan Exposure (as defined
in the Credit Agreement) (the "Requisite Revolving Lenders") or the Bridge
Lenders holding a majority of the Bridge Loans, the Term Loans and the Exchange
Notes then outstanding (the "Requisite Bridge Lenders"), as the case may be;
provided, however, that it shall give five Business Days prior written notice
of such action to the other Secured Parties unless it determines in good faith
that immediate action is necessary to protect the Collateral, in which case
such notice may be given contemporaneously with the taking of such action.
D. If any Secured Party acquires custody, control or
possession of any Collateral or proceeds therefrom, such Secured Party shall
promptly cause such Collateral, proceeds or payments to be delivered or
distributed in accordance with the provisions of Section 2 of this Agreement.
Until such time as the provisions of the immediately preceding sentence have
been complied with, such Secured Party shall be deemed to hold all such
Collateral, proceeds and payments in trust for the Secured Parties entitled
thereto hereunder. Nothing in this Section shall prevent a Secured Party from
receiving and retaining payments (a) for the provision of services to Borrower
or its Subsidiaries, or (b) in connection with any extension of credit or other
financial accommodation to Borrower or its Subsidiaries, or (c) as security for
any such extension of credit or other financial accommodation if the
obligations of Borrower or its Subsidiaries incurred in connection with such
services, extension of credit or other financial accommodation do not
constitute obligations secured by the Collateral Documents, and if such
obligations are not incurred and such security is not given in breach of the
Credit Agreement or the Senior Secured Credit Agreement.
E. This Agreement shall only apply to the Secured
Parties' rights with respect to the Collateral and the Collateral Documents.
Nothing in this Agreement is intended to affect the rights and remedies of any
of the Secured Parties with respect to any other security interests, liens,
mortgages, pledges or charges of any kind whatsoever which such Secured Parties
may now have or may hereafter obtain with respect to any of the Borrower, its
Subsidiaries or any of the property or assets of the Borrower or its
Subsidiaries other than the Collateral.
Section 2. Application of Collateral or Proceeds of
Collateral. All Collateral or proceeds therefrom shall be applied in the
following order of priority:
4
5
First, to the extent not theretofore paid by or on behalf of
Borrower, to pay the fees, costs, expenses of the Revolving Agent, the Bridge
Agent or the Collateral Agent incurred in connection with the performance of
its duties under the Collateral Documents, including reasonable attorneys' fees
and expenses, and any other amounts payable to the Revolving Agent, the Bridge
Agent or the Collateral Agent hereunder or under any of the Collateral
Documents in respect of any indemnities or other obligations of the Borrower or
its Subsidiaries;
Second, to the Bridge Agent for the benefit of the Bridge
Lenders in the aggregate amount owed to the Bridge Lenders and the Bridge Agent
under the Senior Secured Credit Agreement;
Third, to the Revolving Agent for the benefit of the Revolving
Lenders in the aggregate amount owed to Revolving Lenders and the Revolving
Agent under the Credit Agreement; and
Fourth, after the payment in full of all obligations under the
Collateral Documents, the balance, if any, to such Person or Persons as are
entitled thereto.
Section 3. Appointment of Collateral Agent.
A. The Revolving Agent on behalf of the Revolving
Lenders and the Bridge Agent on behalf of the Bridge Lenders hereby severally
appoint Bankers Trust Company as Collateral Agent, and authorize the Collateral
Agent to serve as the agent and representative of the Revolving Lenders and the
Bridge Lenders for the purposes of executing and delivering on their behalf the
Pledge Agreements to be executed and delivered by the Borrower and its
Subsidiaries party thereto and, subject to the provisions of this Agreement,
enforcing the Revolving Lenders' and the Bridge Lenders' rights in respect of
the Stock Collateral and the obligations of the Borrower and its Subsidiaries
under the Pledge Agreements. Bankers Trust Company hereby accepts such
appointment and agrees to act as Collateral Agent hereunder and to enter into
and act as Collateral Agent under the Pledge Agreements in accordance with the
terms thereof and of this Agreement.
B. Each party executing this Agreement which is entitled
to give directions to the Collateral Agent agrees that the Collateral Agent may
act as Requisite Revolving Lenders or Requisite Bridge Lenders may request
(regardless of whether any individual Revolving Lender or Bridge Lender agrees,
disagrees or abstains with respect to such request) and that the Collateral
Agent shall have no liability for acting in accordance with such request
(provided such action does not conflict with the express terms of this
Agreement).
C. The Collateral Agent may at any time request
directions from the Requisite Revolving Lenders or Requisite Bridge Lenders
as to any course of action or other matter relating hereto or to the Pledge
Agreements. Except as otherwise may be
5
6
provided in the Pledge Agreements, directions given by Requisite Revolving
Lenders or Requisite Bridge Lenders to the Collateral Agent hereunder shall be
binding on all Revolving Lenders or all Bridge Lenders, as the case may be.
D. Each of the Revolving Agent, the Bridge Agent, the
Revolving Lenders and the Bridge Lenders agrees not to take any action
whatsoever to enforce any term or provision of the Pledge Agreements or to
enforce any of its rights in respect of the Stock Collateral except through the
Collateral Agent in accordance with this Agreement.
Section 4. Disclaimers, Indemnity, Etc.
A. The Collateral Agent shall have no duties or
responsibilities to the Secured Parties except those expressly set forth in
this Agreement and the Collateral Documents and the Collateral Agent shall not
by reason of this Agreement or the Collateral Documents be a trustee for any
Secured Party or have any other fiduciary obligation to any Secured Party
(other than, if the Exchange Notes are subject to the Trust Indenture Act of
1939, as amended (the "TIA"), any obligation under the TIA). The Collateral
Agent shall not be responsible to any Secured Party for any recitals,
statements, representations or warranties contained in this Agreement, the
Credit Agreement or the Senior Secured Credit Agreement or any related loan
documents (collectively, the "Financing Agreements") or in any certificate or
other document referred to or provided for in, or received by any of them
under, any of the Financing Agreements, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of any of the
Financing Agreements or any other document referred to or provided for therein
or any lien under the Collateral Documents or the perfection or priority of any
such lien or the value or condition of the Collateral or the title of the
Borrower or its Subsidiaries to the Collateral or for any failure by Borrower
or its Subsidiaries to perform any of its obligations under any of the
Financing Agreements. The Collateral Agent may employ agents and attorneys-
in-fact and shall not be responsible for the negligence or misconduct of any
such agents or attorneys-in-fact selected by it with reasonable care. Neither
the Collateral Agent nor any of its directors, officers, employees or agents
shall be liable or responsible for any action taken or omitted to be taken by
it or them hereunder or in connection herewith, except to the extent of its or
their own gross negligence or willful misconduct.
B. The Collateral Agent shall be entitled to rely upon
any certification, notice or other communication (including any thereof by
telex, telecopy, telegram or cable) believed by it to be genuine and correct
and to have been signed or sent by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel (including counsel to
the Borrower or any Subsidiary of the Borrower), independent accountants and
other experts selected by the Collateral Agent.
C. Notwithstanding anything to the contrary contained
herein, the Collateral Agent shall not be required to take any action that is
in its opinion contrary to law or to the terms of this Agreement or any or all
of the Collateral Documents or which
6
7
would in its opinion subject it or any of its officers, employees or directors
to liability, and the Collateral Agent shall not be required to take any action
under this Agreement or any or all of the Collateral Documents unless and until
the Collateral Agent shall be indemnified to its satisfaction by the Secured
Parties against any and all loss, cost, expense or liability in connection
therewith.
D. Except as expressly provided herein or in the
Collateral Documents, the Collateral Agent shall have no duty to take any
affirmative steps with respect to the collection of amounts payable in respect
of the Collateral. The Collateral Agent shall incur no liability as a result of
any sale of any Collateral at any private sale, except to the extent that such
liability arises or results from its gross negligence or willful misconduct.
E. (i) The Collateral Agent may resign at any time by
giving at least 30 days notice thereof to the Secured Parties (such resignation
to take effect as hereinafter provided). In the event of any such resignation
of the Collateral Agent, the Revolving Lenders and the Bridge Lenders shall
thereupon have the right to appoint a successor Collateral Agent. If no
successor Collateral Agent shall have been so appointed and shall have accepted
such appointment within 30 days after the notice of the intent of the
Collateral Agent to resign, then the retiring Collateral Agent may, on behalf
of the other Secured Parties, appoint a successor Collateral Agent. Any
successor Collateral Agent appointed pursuant to this clause (i) shall be a
bank party to the Credit Agreement or the Senior Secured Credit Agreement or a
commercial bank organized under the laws of the United States of America or any
state thereof and having a combined capital and surplus of at least
$250,000,000.
(ii) Upon the acceptance of any appointment as
Collateral Agent hereunder by a successor Collateral Agent, such successor
Collateral Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring or removed Collateral
Agent, and the retiring or removed Collateral Agent shall thereupon be
discharged from its duties and obligations hereunder. After any retiring or
removed Collateral Agent's resignation or removal hereunder as Collateral
Agent, the provisions of this Section shall continue in effect for its benefit
in respect of any actions taken or omitted to be taken by it while it was
acting as the Collateral Agent.
F. The Borrower agrees (i) to reimburse the Collateral
Agent, on demand, for any expenses incurred by the Collateral Agent, including
counsel fees and compensation of agents, arising out of, in any way connected
with, or as a result of, the execution or delivery of this Agreement, any
Collateral Document or any agreement or instrument contemplated hereby or
thereby or the performance by the parties hereto or thereto of their respective
obligations hereunder or thereunder or in connection with the enforcement or
protection of the rights of the Collateral Agent and the Secured Parties under
this Agreement and any Collateral Documents and (ii) to indemnify and hold
harmless the Collateral Agent and its directors, officers, employees and
agents, on demand, from and against any and all claims, liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever
7
8
which may be imposed on, incurred by or asserted against the Collateral Agent
in its capacity as the Collateral Agent or any of them in any way relating to
or arising out of this Agreement or any Collateral Document, or any action
taken or omitted by them under this Agreement or any Collateral Document;
provided that the Borrower shall not be liable to the Collateral Agent for any
portion of such claims, liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements to the extent
resulting from the gross negligence or willful misconduct of the Collateral
Agent or any of its directors, officers, employees or agents. In addition, in
the event that any successor Collateral Agent shall be appointed, the Borrower
agrees to pay the reasonable fees and expenses of such successor Collateral
Agent for the performance of its duties hereunder and under the Collateral
Documents.
Section 5. Miscellaneous.
A. All notices and other communications provided for
herein shall be in writing and may be personally served, telecopied, or sent by
courier delivery or United States mail and shall be deemed to have been given
when delivered in person, or upon receipt of such telecopy, courier delivery or
mail. For the purposes hereof, the addresses of the parties hereto (until
notice of a change thereof is delivered as provided in this Section 5(A)) shall
be as set forth under each party's name on the signature pages hereof.
B. This Agreement and the Collateral Documents may be
modified or waived only by an instrument or instruments in writing signed by
the Revolving Agent, the Bridge Agent and the Collateral Agent and the Borrower
and its Subsidiaries signatory hereto or to any such Collateral Document.
C. This Agreement shall be binding upon and inure to the
benefit of the Revolving Agent, the Bridge Agent and the Collateral Agent, each
other Person party hereto and each Secured Party and their respective
successors and assigns.
D. This 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 Agreement by signing
any such counterpart.
E. Upon the earlier to occur of: (I) the payment in full
of the Borrower's obligations under the Senior Secured Credit Agreement through
the proceeds of the issuance of the Takeout Securities (as defined in the
Credit Agreement) or (II) the termination of all commitments to extend credit
which would constitute obligations secured by the Collateral Documents and the
indefeasible payment in full of all such obligations and expiration or
cancellation of all letters of credit secured by the Collateral Documents, this
Agreement shall terminate.
F. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE
8
9
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK) WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES.
G. By countersigning or otherwise accepting the terms of
this Agreement, the Borrower and each Subsidiary party hereto acknowledge and
consent to and agree to perform and be bound by each of the provisions hereof
stated to be applicable to them.
H. All judicial proceedings brought against any party
hereto arising out of or relating to this Agreement may be brought in any state
or federal court of competent jurisdiction located in the Borough of Manhattan
in the State of New York and by execution and delivery of this Agreement, each
party hereto accepts for itself and in connection with its properties,
generally and unconditionally, the nonexclusive jurisdiction of the aforesaid
courts and waives any defense of forum non conveniens and irrevocably agrees to
be bound by any judgment rendered thereby in connection with this Agreement.
I. EACH PARTY HEREBY WAIVES ITS RIGHTS TO A JURY TRIAL
OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT.
The scope of this waiver is intended to be all encompassing of any and all
disputes that may be filed in any court and that relate to the subject matter
of this transaction, including without limitation contract claims, tort claims,
breach of duty claims, and all other common law and statutory claims. Each
party hereto acknowledges that this waiver is a material inducement to enter
into a business relationship, that each has already relied on this waiver in
entering into this Agreement and that each will continue to rely on this waiver
in their related future dealings. Each party hereto further warrants and
represents that it has reviewed this waiver with its legal counsel, and that it
knowingly and voluntarily waives its jury trial rights following consultation
with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE
MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
AGREEMENT. In the event of litigation, this Agreement may be filed as a written
consent to a trial by the court.
J. Nothing contained in this Agreement and no action
taken by the Bridge Agent, the Revolving Agent or the Collateral Agent
hereunder shall be deemed to constitute the Bridge Agent, the Revolving Agent
or the Collateral Agent a partnership, association, joint venture or other
entity.
9
10
IN WITNESS HEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
BANKERS TRUST COMPANY, as Bridge Agent
By: /s/ Xxxxxxxx X. Page
-------------------------------------
Title: Managing Director
----------------------------------
Notice Address:
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention:
----------------------
Telecopy No.: (000) 000-0000
BT COMMERCIAL CORPORATION
as Revolving Agent
By: /s/ [ILLEGIBLE]
-------------------------------------
Title: Vice President
----------------------------------
Notice Address:
BT Commercial Corporation
00 Xxxx Xxxxxx, 0xx Xxxxx
Mail Stop #4032
Xxx Xxxx, XX 00000
Attention: Bharti Baliga
Telecopy: (000) 000-0000
S-1
11
Each Loan Party, by its execution of this Agreement in the
space provided below, hereby accepts and agrees to be bound by the foregoing
provisions of this Agreement.
FWT, INC.
By: /s/ XXX X. XXXXX
---------------------------------------
Title: C.E.O.
------------------------------------
S-2
