EX-10.5
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ex10-5.htm
AMENDED AND RESTATED
SENIOR SECURITY AGREEMENT
Exhibit
10.5
EXECUTION COPY
SENIOR
SUBSIDIARY SECURITY AGREEMENT
SENIOR
SUBSIDIARY SECURITY AGREEMENT, dated as of June 27, 2001, as amended and
restated as of June 5, 2009 (as amended, supplemented or otherwise modified from
time to time, this “Agreement”), made by the
SUBSIDIARY GUARANTORS identified on the signature pages hereto and any other
Person that becomes a Subsidiary Guarantor pursuant to the Senior Credit
Agreement (as such term is defined below) (collectively, the “Grantors”), in favor of
CITICORP NORTH AMERICA, INC., a Delaware corporation (“CNAI”), as Senior Collateral
Agent.
Reference
is made to the Senior Credit Agreement, dated as of June 27, 2001, as
amended and restated as of June 5, 2009 (as amended, supplemented or otherwise
modified from time to time, the “Senior Credit Agreement”),
among Rite Aid Corporation, a Delaware corporation (the “Borrower”), the lenders from
time to time party thereto (the “Senior Lenders”), CNAI, as
administrative agent for the Senior Lenders, and the other agents party
thereto. Reference is also made to the Senior Subsidiary Security
Agreement dated as of June 27, 2001, as amended and restated as of
September 22, 2004 (the “Restatement Effective Date”)
(as amended, supplemented or otherwise modified from time to time prior to the
2009 Restatement Effective Date, the “Original Senior Subsidiary Security
Agreement”) among the Subsidiary Guarantors identified on the signature
pages thereto and each other Person that became a Subsidiary Guarantor pursuant
to the Senior Credit Agreement prior to the 2009 Restatement Effective Date
(collectively, the “Original
Grantors”) and Citicorp USA, Inc., a Delaware corporation, as senior
collateral agent (in such capacity, the “Original Senior Collateral
Agent”), pursuant to which the Original Grantors agreed to secure the
Senior Obligations (as defined in the Original Senior Subsidiary Security
Agreement). The Original Grantors and the Original Senior Collateral
Agent now wish to amend and restate the Original Senior Subsidiary Security
Agreement in its entirety as set forth herein to secure the payment or
performance, as the case may be, in full of the obligations under the Senior
Subsidiary Guarantee Agreement.
The
Senior Lenders have agreed to make Loans to the Borrower, and the Issuing Banks
have agreed to issue Letters of Credit for the account of the Borrower, pursuant
to, and upon the terms and subject to the conditions specified in, the Senior
Credit Agreement. In addition, from time to time on or after the 2009
Restatement Effective Date, the Borrower may incur Additional Senior Debt
Obligations to one or more Additional Senior Debt Parties pursuant to the
Additional Senior Debt Documents. Each of the Subsidiary Guarantors
has agreed to guarantee, among other things, all the obligations of the Borrower
under the Senior Credit Agreement and, to the extent specified in the Additional
Senior Debt Documents, the Additional Senior Debt Obligations. In
order to induce the Senior Lenders to make the Loans, the Issuing Banks to issue
Letters of Credit and Additional Senior Debt Parties to acquire Additional
Senior Debt from, or otherwise extend credit constituting Additional Senior Debt
to, the Borrower, the Grantors have agreed to guarantee the due and punctual
payment of the Senior Obligations pursuant to the
terms
of the senior subsidiary guarantee agreement dated as of June 27, 2001, as
amended and restated as of the date hereof (as amended, supplemented or
otherwise modified from time to time, the “Senior Subsidiary Guarantee
Agreement”) among the Borrower, the Subsidiary Guarantors and the Senior
Collateral Agent for the benefit of the Senior Secured Parties.
Accordingly,
the Grantors and the Senior Collateral Agent, on behalf of themselves and each
Senior Secured Party (and each of their respective successors and assigns),
hereby agree as follows:
SECTION
1. Defined
Terms.
SECTION
1.01. Definitions. (a) Unless otherwise defined
herein capitalized terms used herein shall have the meanings given in the
Definitions Annex attached as Annex 2 hereto (as amended, supplemented or
otherwise modified from time to time), or if not defined therein, as defined in
the Senior Credit Agreement. All terms defined in the
New York UCC
(as defined herein) and not defined in this Agreement shall have the meanings
specified therein.
(b) The
following terms shall have the following meanings:
“Accounts Receivable” means, with respect to
each Grantor, all right, title and interest of such Grantor to Accounts and all
of its right, title and interest in any returned goods, together with all
rights, titles, securities and guaranties with respect thereto, including any
rights to stoppage in transit, replevin, reclamation and resales, and all
related security interests, liens and pledges, whether voluntary or involuntary
in each case whether due or become due, whether now or hereafter arising in the
future.
“Blocked Account” means each
of the accounts established by the applicable Grantors listed in Section 4
of Schedule 3 to this Agreement and maintained with a Blocked Account Bank
pursuant to a Blocked Account Agreement.
“Blocked Account
Agreement” means any Blocked Account
Agreement between the Senior Collateral Agent and a Blocked Account Bank
substantially in the form of Schedule 4 to this Agreement.
“Blocked Account Bank” means
any bank or financial institution that is satisfactory to the Senior Collateral
Agent and the Borrowing Base Agent that executes and delivers to the Senior
Collateral Agent a Blocked Account Agreement.
“Blocked Account Cash Sweep Notice”
means a notice in the form attached as Exhibit A to the Blocked Account
Agreement.
“Cash Management Accounts”
mean, collectively, (a) the Blocked Accounts, (b) the Deposit
Accounts, (c) the Concentration Account and (d) the Citibank Concentration
Accounts.
“Cash Management System” means
the system of cash management described in Schedule 3 to this
Agreement.
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“Cash Sweep Cash Collateral
Account” means the collateral account established as part of the Cash
Management System at Citibank, N.A. and under the sole dominion and control of
the Senior Collateral Agent, Account No. 00000000.
“Cash Sweep Notice” means (a)
any Blocked Account Cash Sweep Notice and (b) the Concentration Account Cash
Sweep Notice.
“Cash Sweep Period” means any
period in which funds are transferred from (a) any Blocked Account to the
Concentration Account or any Citibank Concentration Account, as applicable,
pursuant to a Blocked Account Cash Sweep Notice or (b) the Concentration Account
to any Citibank Concentration Account pursuant to a Concentration Account Cash
Sweep Notice.
“Citibank Concentration
Account” means the account established at Citibank and under sole
dominion and control of the Senior Collateral Agent, CNAI FAO Rite Aid
Concentration Account No. 00000000, together with any similar account
established at Citibank, N.A. for the purpose of collecting funds during a Cash
Sweep Period.
“Concentration Account” means
the cash collateral account established at JPMorgan Chase Bank and maintained
with the Concentration Account Bank pursuant to a Concentration Account
Agreement, Account No. 9102750222.
“Concentration Account
Agreement” means a Concentration Account Agreement between any Subsidiary
Guarantor, the Senior Collateral Agent and a bank or financial institution
satisfactory to the Senior Collateral Agent substantially in the form of
Schedule 7 to this Agreement.
“Concentration Account Bank”
means a bank or financial institution that is satisfactory to the Senior
Collateral Agent and the Borrowing Base Agent that executes and delivers to the
Senior Collateral Agent a Concentration Account Agreement.
“Concentration Account Cash Sweep
Notice” means a notice in the form attached as Exhibit A to the
Concentration Account Agreement.
“Contracts” means, with
respect to each Grantor, all rights of such Grantor under all contracts and
agreements to which such Grantor is a party or under which such Grantor has any
right, title or interest or to which such Grantor or any property of such
Grantor is subject, as the same may from time to time be amended, supplemented
or otherwise modified, including (a) all rights of such Grantor to receive
moneys due and to become due to it thereunder or in connection therewith, (b)
all rights of such Grantor to damages arising out of, or for, breach or default
in respect thereof and (c) all rights of such Grantor to exercise all remedies
thereunder.
“Copyright License” means any
written agreement, now or hereafter in effect, granting any right to any third
party under any copyright now or hereafter owned by any Grantor or that such
Grantor otherwise has the right to license, or granting any right to any Grantor
under any copyright now or hereafter owned by any third party, and all rights of
such Grantor under any such agreement.
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“Copyrights” means all of the
following now owned or hereafter acquired by any
Grantor: (a) all copyright rights in any work subject to the
copyright laws of the United States or any other country, whether as author,
assignee, transferee or otherwise, and (b) all registrations and
applications for registration of any such copyright in the United States or any
other country, including registrations, recordings, supplemental registrations
and pending applications for registration in the United States Copyright
Office.
“Deposit Account” means,
collectively, (a) the Lockbox Account and (b) the Government Lockbox Account, as
well as any demand, time, savings, passbook, or similar account maintained with
a bank or other financial institution. The term “Deposit Account”
shall not include investment property or accounts evidenced by an
instrument.
“Event of Default” means an
“Event of Default” as defined in the Senior Credit Agreement or any Additional
Senior Debt Facility.
“Government Lockbox Account”
means the deposit account and corresponding lockbox established and maintained
at Mellon Bank, N.A., Account No. 0000000 or another Government Lockbox
Account Bank.
“Government Lockbox Account
Agreement” means any Government Lockbox Account Agreement between the
Senior Collateral Agent and a Government Lockbox Account Bank substantially in
the form of Schedule 6 to this Agreement.
“Government Lockbox Account
Bank” means any bank or financial institution that is satisfactory to the
Senior Collateral Agent and the Borrowing Base Agent that executes and delivers
to the Senior Collateral Agent a Government Lockbox Account
Agreement.
“Indemnitee” means the Senior
Secured Parties and their respective officers, directors, trustees, affiliates
and controlling Persons.
“Intellectual Property” means
all inventions, designs, Patents, Copyrights, Licenses, Trademarks, trade
secrets, confidential or proprietary technical and business information,
know-how, show-how or other data or information, software and databases and all
embodiments or fixations thereof and related documentation, registrations and
franchises, and all additions, improvements and accessions to, and books and
records describing or used in connection with, any of the
foregoing.
“Intercompany Advances” means
any advances or open accounts owing by the Borrower or any Subsidiary to any
Grantor.
“License” means any Patent
License, Trademark License, Copyright License or other license or sublicense
agreement to which any Grantor is a party.
“Lockbox Account” means the
deposit account and corresponding lockbox established at Mellon Bank, N.A. and
maintained with the Lockbox Account Bank pursuant to a Lockbox Account
Agreement, Account No. 0000000.
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“Lockbox Account Agreement”
means any Lockbox Account Agreement between the Senior Collateral Agent and a
Lockbox Account Bank substantially in the form of Schedule 5 to this
Agreement.
“Lockbox Account Bank” means
any bank or financial institution that is satisfactory to the Senior Collateral
Agent and the Borrowing Base Agent that executes and delivers to the Senior
Collateral Agent a Lockbox Account Agreement.
“
New York UCC” means
the Uniform Commercial Code as in effect from time to time in the State of
New York.
“Patent License” means any
written agreement, now or hereafter in effect, granting to any third party any
right to make, use or sell any invention on which a patent, now or hereafter
owned by any Grantor or that any Grantor otherwise has the right to license, is
in existence, or granting to any Grantor any right to make, use or sell any
invention on which a patent, now or hereafter owned by any third party, is in
existence, and all rights of any Grantor under any such agreement.
“Patents” means all of the
following now owned or hereafter acquired by any
Grantor: (a) all letters patent of the United States or any
other country, all registrations and recordings thereof, and all applications
for letters patent of the United States or the equivalent thereof in any other
country, including registrations, recordings and pending applications in the
United States Patent and Trademark Office or the equivalent thereof in any
similar offices in any other country, and (b) all reissues, continuations,
divisions, continuations-in-part, renewals or extensions thereof, and the
inventions disclosed or claimed therein, including the right to make, use and/or
sell the inventions disclosed or claimed therein.
“Prescription Files” means, as
to any Grantor, all right, title and interest of such Grantor in and to all
prescription files maintained by it or on its behalf, including all patient
profiles, customer lists, customer information and other records of
prescriptions filled by it, in whatever form and wherever maintained by it or on
its behalf, and all goodwill and other intangible assets arising from the
maintenance of such records and the possession of information contained
therein.
“Proceeds” has the meaning
specified in Section 9-102 of the
New York UCC, and shall include
(a) all cash and negotiable instruments received by or held on behalf of
the Senior Collateral Agent, (b) any claim of any Grantor against any third
party for (and the right to xxx and recover for and the rights to damages or
profits due or accrued arising out of or in connection with) (i) past,
present or future infringements of any Patent now or hereafter owned by any
Grantor, or licensed under a Patent License, (ii) past, present or future
infringement or dilution of any Trademark now or hereafter owned by any Grantor
or licensed under a Trademark License or injury to the goodwill associated with
or symbolized by any Trademark now or hereafter owned by any Grantor,
(iii) past, present or future breach of any License and (iv) past,
present or future infringement of any Copyright now or hereafter owned by any
Grantor or licensed under a Copyright License and (c) any and all other
amounts from time to time paid or payable under or in connection with any of the
Senior Collateral.
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“Senior Collateral” is defined
in Section 2 of this Agreement.
“Senior Collateral Account”
means any collateral account established by the Senior Collateral Agent as
provided in Section 5.03 or Section 7.02.
“Trademark License” means any
written agreement, now or hereafter in effect, granting to any third party any
right to use any trademark now or hereafter owned by any Grantor or that any
Grantor otherwise has the right to license, or granting to any Grantor any right
to use any trademark now or hereafter owned by any third party, and all rights
of any Grantor under any such agreement.
“Trademarks” means all of the
following now owned or hereafter acquired by any
Grantor: (a) all trademarks, service marks, trade names,
corporate names, company names, business names, fictitious business names, trade
styles, trade dress, logos, other source or business identifiers, designs and
general intangibles of like nature, now existing or hereafter adopted or
acquired, all registrations and recordings thereof, and all registration and
recording applications filed in connection therewith, including registrations
and registration applications in the United States Patent and Trademark Office
or any similar offices in any State of the United States or any other country or
any political subdivision thereof, and all extensions or renewals thereof, (b)
all goodwill associated therewith or symbolized thereby and (c) all other
assets, rights and interests that uniquely reflect or embody such
goodwill.
SECTION
1.02. Other
Definitional Provisions. (a) The words “hereof,”
“herein” and “hereunder” and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Section references are to this Agreement unless otherwise
specified. The words “include”, “includes” and “including” shall be deemed to be
followed by the phrase “without limitation”.
(b) The
meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.
SECTION
2. Grant of
Security Interest. As security for the payment or performance,
as the case may be, in full of the obligations under the Senior Subsidiary
Guarantee Agreement, each Grantor hereby assigns and pledges to the Senior
Collateral Agent, its successors and assigns, for the ratable benefit of the
Senior Secured Parties, and hereby grants to the Senior Collateral Agent, its
successors and assigns, for the ratable benefit of the Senior Secured Parties, a
security interest in all right, title or interest now owned or at any time
hereafter acquired by such Grantor or in which such Grantor now has or at any
time in the future may acquire any right, title or interest (collectively, the
“Senior
Collateral”):
(a)
all Accounts Receivable and Chattel Paper;
(b)
all Deposit Accounts;
(c)
the Cash Management Accounts and the funds on deposit
therein;
(d)
all Contracts;
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(e)
all Documents;
(f)
all General Intangibles;
(g)
all Instruments;
(h)
all Intellectual Property;
(i)
all Inventory;
(j)
all Prescription Files;
(k)
all books and records pertaining to any and all of the foregoing;
and
(l)
to the extent not otherwise included, all Proceeds and products of any
and all of the foregoing.
Nothing
contained in this Section 2 is intended to limit any Grantor’s rights to create
Permitted Liens (as defined below). Notwithstanding anything else
contained in this Section 2 to the contrary, Senior Collateral shall not include
any Equity Interests of any Subsidiary. Senior Collateral shall not
include any property specified in Section 2(h) above if the granting of a
security interest therein would jeopardize the Grantor’s rights in any pending
intent-to-use applications for Federal Trademark
registration. Furthermore, notwithstanding anything herein to the
contrary, in no event shall the security interest granted under this Section 2
attach to any lease, license, contract, property rights or agreement to which
each Grantor is a party or any of its rights or interests thereunder if and for
so long as the grant of such security interest shall constitute or result in (i)
the abandonment, invalidation or unenforceability of any right, title or
interest of any Grantor therein or (ii) in a breach or termination pursuant to
the terms of, or a default under, any such lease, license, contract, property
rights or agreement (other than to the extent that any such term would be
rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the
Uniform Commercial Code (or any successor provision or provisions) of any
relevant jurisdiction or any other applicable law or principles of equity);
provided
however that such security interest shall attach immediately at such time as the
condition causing such abandonment, invalidation or unenforceability shall be
remedied and, to the extent severable, shall attach immediately to any portion
of such lease, license, contract, property rights or agreement that does not
result in any of the consequences specified in clause (i) or (ii) of this
sentence.
Each
Grantor hereby irrevocably authorizes the Senior Collateral Agent at any time
and from time to time to file in any Uniform Commercial Code jurisdiction any
initial financing statements (including fixture filings) and amendments thereto
without the signature of such Grantor in such form and in such filing offices as
the Senior Collateral Agent reasonably determine, that contain the information
required by Article 9 of the Uniform Commercial Code of each applicable
jurisdiction for the filing of any financing statement or amendment, including
(a) whether the Grantor is an organization, the type of organization and any
organizational identification number issued to the Grantor and (b) in the case
of a financing statement filed as a fixture filing, a sufficient description of
the real property to which such Collateral relates. The Grantor
agrees to provide such information to the Senior Collateral Agent and the
Borrowing
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Base
Agent promptly upon request by either of them. In addition, each
Grantor hereby authorizes and agrees that such financing statements may describe
the Senior Collateral in the same manner as described herein or may contain an
indication or description of collateral that describes such property in any
other manner as the Senior Collateral Agent may determine, in its sole
discretion, is necessary, advisable or prudent to ensure the perfection of the
security interest in the Collateral granted to the Senior Collateral Agent
herein, including describing such property as “all assets now owned or hereafter
acquired” or “all personal property now owned or hereafter
acquired.”
Each
Grantor also ratifies its authorization for the Senior Collateral Agent to file
in any Uniform Commercial Code jurisdiction any initial financing statements or
amendments thereto if filed prior to the Restatement Effective
Date.
The
Senior Collateral Agent is further authorized to file filings with the United
States Patent and Trademark Office or United States Copyright Office (or any
successor office or any similar office in any other country) or other documents
for the purpose of perfecting, confirming, continuing, enforcing or protecting
the security interest in the Senior Collateral granted by each Grantor
hereunder, without the signature of any Grantor, and naming any Grantor or the
Grantors as debtors and the Senior Collateral Agent as secured
parties.
Such
security interests are granted as security only and shall not subject the Senior
Collateral Agent nor any Senior Secured Party to, or in any way alter or modify,
any obligation or liability of any Grantor with respect to or arising out of the
Senior Collateral.
SECTION
3. Representations and
Warranties. Each Grantor hereby represents and warrants, as to
itself and the Senior Collateral in which the security interest is created
hereunder, that:
SECTION
3.01. Title;
No Other Liens. Except for the security interest granted to
the Senior Collateral Agent for the ratable benefit of the Senior Secured
Parties pursuant to this Agreement and the other Liens (including the Second
Priority Liens) permitted to exist pursuant to the Senior Credit Agreement and
the other Senior Debt Documents (the “Permitted Liens”), each
Grantor owns each item of the Senior Collateral free and clear of any and all
Liens or claims of others (or arrangements reasonably satisfactory to the Senior
Collateral Agent have been made for the timely release or discharge of such
Liens). No security agreement, financing statement or other public
notice with respect to all or any part of such Senior Collateral is on file or
of record in any public office, except such as have been filed or will be filed,
pursuant to this Agreement, in favor of the Senior Collateral Agent, for the
ratable benefit of the Senior Secured Parties, or in respect of Permitted Liens
(or arrangements reasonably satisfactory to the Senior Collateral Agent have
been made for the timely termination of such agreement or financing statement).
Further, no Grantor has intentionally entered into any contract, lease or
license in anticipation of this Agreement, which by its terms, validly prohibits
the granting of a security interest in the Senior Collateral
herein.
SECTION
3.02. Enforceable Obligation; Perfected, First Priority Security
Interests. This Agreement constitutes a legal, valid and
binding obligation of each Grantor, enforceable against such Grantor in
accordance with its terms, except as enforceability may be limited by
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bankruptcy,
insolvency, moratorium, reorganization or other similar laws affecting
creditors’ rights generally and except as enforceability may be limited by
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law), and the security interests
granted pursuant to this Agreement (a) upon completion of the filings and other
actions contemplated by or specified in this Agreement (or in the case of
Instruments, delivery to the Senior Collateral Agent or their designees) shall
constitute fully perfected security interests in the Senior Collateral in favor
of the Senior Collateral Agent for the ratable benefit of the Senior Secured
Parties, and (b) are prior and superior in right to all other Liens (other than
Permitted Liens, to the extent that such Permitted Liens are expressly permitted
by the Senior Debt Documents to have priority) on the Senior Collateral in
existence on the 2009 Restatement Effective Date.
SECTION
3.03. Chief
Executive Office; Jurisdiction of Incorporation. As of the
2009 Restatement Effective Date, each Grantor’s chief executive office,
principal place of business and jurisdiction of incorporation is located at the
locations listed in Schedule 8 hereto.
SECTION
3.04. Farm
Products. None of the Senior Collateral constitutes, or is the
Proceeds of, Farm Products (as such term is defined in the Uniform Commercial
Code).
SECTION
3.05. Intellectual
Property. (a) Schedule 2 lists all Intellectual
Property owned (and registered with the U.S. Copyright Office or the U.S. Patent
and Trademark Office) or licensed by such Grantor in its own name on the
Restatement Effective Date.
(b) On
the date hereof, based on information known, or reasonably available to such
Grantor, all Intellectual Property material to the conduct of such Grantor’s
business is valid, subsisting, unexpired and enforceable, has not been abandoned
and does not infringe the intellectual property rights of any other
Person.
(c) Except
as set forth in Schedule 2, on the Restatement Effective Date, none of the
Intellectual Property is the subject of any licensing or franchise agreement
pursuant to which such Grantor is the licensor or franchisor.
(d) On
the 2009 Restatement Effective Date, based on information known, or reasonably
available to such Grantor, no holding decision or judgment has been rendered by
any Governmental Authority which would materially limit, cancel or question the
validity of, or such Grantor’s rights in, any Intellectual Property in any
respect that could reasonably be expected to have a Material Adverse
Effect.
(e) Except
as set forth on Schedule 2, on the Restatement Effective Date, no action or
proceeding is pending, or, to the knowledge of such Grantor, threatened
(i) seeking to materially limit, cancel or question the validity of any
Intellectual Property material to the conduct of such Grantor’s business or such
Grantor’s ownership interest therein, or (ii) which, if adversely determined,
would have a material adverse effect on the value of any Intellectual
Property.
SECTION
4. Covenants. Each
Grantor covenants and agrees with the Senior Secured Parties that, from and
after the 2009
Restatement Effective Date until this Agreement is terminated and the
security interests created hereby are released:
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SECTION
4.01. Delivery of
Instruments. If an Intercompany Advance owned by such Grantor
shall be or become evidenced by any promissory note, or other Instrument, upon
the request of the Senior Collateral Agent, such promissory note, or other
Instrument shall be immediately delivered to the Senior Collateral Agent, duly
indorsed in a manner reasonably satisfactory to the Senior Collateral Agent, to
be held as Senior Collateral pursuant to this Agreement.
SECTION
4.02. Maintenance of
Insurance. Each Grantor shall maintain insurance policies in
accordance with the requirements of Section 5.07 of the Senior Credit
Agreement.
SECTION
4.03. Maintenance of Perfected Security
Interest; Further Documentation. (a)Each Grantor shall
maintain the security interests created by this Agreement as first priority
perfected security interests subject only to Permitted Liens, to the extent such
Permitted Liens are expressly permitted by the Senior Debt Documents to have
priority, and shall defend such security interests against all claims and
demands of all Persons whomsoever (other than those pursuant to Permitted
Liens).
(b) At
any time and from time to time, upon the written request of the Senior
Collateral Agent or any Borrowing Base Agent, and at the sole expense of a
Grantor, such Grantor shall promptly and duly execute and deliver such further
instruments and documents and take such further action as the Senior Collateral
Agent or any Borrowing Base Agent may reasonably request for the purpose of
obtaining or preserving the full benefits of this Agreement and of the rights
and powers herein granted, including, without limitation, the filing of any
financing or continuation statements under the Uniform Commercial Code in effect
in any jurisdiction with respect to the security interests created
hereby.
(c) No
Grantor shall intentionally enter into any contract, lease or license which by
its terms would validly prohibit the grant of a security interest in the Senior
Collateral under this Agreement.
SECTION
4.04. Further Identification of Senior
Collateral. Each Grantor shall furnish to the Senior
Collateral Agent from time to time statements and schedules further identifying
and describing the Senior Collateral and such other reports in connection with
such Senior Collateral as the Senior Collateral Agent may reasonably request,
all in reasonable detail.
SECTION
4.05. Senior
Collateral Agent’s Liabilities and Expenses;
Indemnification. (a) Notwithstanding anything to the
contrary provided herein, neither the Senior Collateral Agent nor any other
Senior Secured Party assumes any liabilities with respect to any claims
regarding each Grantor’s ownership (or purported ownership) of, or rights or
obligations (or purported rights or obligations) arising from, the Senior
Collateral or any use (or actual or alleged misuse) whether arising out of any
past, current or future event, circumstance, act or omission or otherwise, or
any claim, suit, loss, damage, expense or liability of any kind or nature
arising out of or in connection with the Senior Collateral or the production,
marketing, delivery, sale or provision of goods or services under or in
connection with any of the Senior Collateral. All of such liabilities
shall, as between the Senior Collateral Agent, the Senior Secured Parties and
the Grantors, be borne exclusively by the Grantors unless such liability arises
from the gross negligence or willful misconduct of the Senior Collateral Agent
or any Senior Secured Party.
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(b) Each
Grantor hereby agrees to pay all reasonable expenses of the Senior Collateral
Agent and the other Senior Secured Parties and to indemnify the Senior
Collateral Agent and the other Senior Secured Parties with respect to any and
all losses, claims, damages, liabilities and related expenses in respect of this
Agreement or the Senior Collateral, in each case to the extent and under the
circumstances the Borrower is required to do so pursuant to Section 9.03 of
the Senior Credit Agreement and any equivalent provision of any Additional
Senior Debt Document.
(c) Any
amounts payable as provided hereunder shall be additional Senior Obligations
secured hereby and by the other Senior Collateral Documents. Without
prejudice to the survival of any other agreements contained herein, all
indemnification and reimbursement obligations contained herein shall survive the
Senior Obligation Payment Date and the termination of this
Agreement.
SECTION
4.06. Intellectual
Property. (a) Each relevant Grantor (either itself or
through licensees) will (i) continue to use each Trademark material to the
conduct of such Grantor’s business, to the extent that such Grantor’s business
operations continue as to the said goods and/or services (subject to such
Grantor’s reasonable business judgment), sufficient to avoid unintentional
abandonment of any rights in such Trademarks, (ii) maintain as in the past the
quality of products and services offered under such Trademark, (iii) use such
Trademark with the appropriate notice of registration and all other notices and
legends required by applicable law, (iv) not knowingly adopt or use any xxxx
which is confusingly similar or a colorable imitation of such Trademark unless
the Senior Collateral Agent, for the ratable benefit of the Senior Secured
Parties, shall obtain a perfected security interest in such xxxx pursuant to
this Agreement, and (v) not knowingly (and not permit any licensee or
sublicensee thereof to) do any act or knowingly omit to do any act whereby such
Trademark material to the conduct of Grantor’s business may become invalidated
or impaired in any way.
(b) Such
Grantor (either itself or through licensees) will not do any act, or omit to do
any act, whereby any Patent material to the conduct of Grantor’s business may
become forfeited, abandoned or dedicated to the public.
(c) Such
Grantor (either itself or through licensees) will not knowingly (and will not
permit any licensee or sublicensee thereof to) do any act or knowingly omit to
do any act whereby any portion of the Copyrights material to the conduct of
Grantor’s business may become invalidated or otherwise impaired or fall into the
public domain.
(d) Such
Grantor (either itself or through licensees) will not do any act that knowingly
uses any material Intellectual Property to infringe the intellectual property
rights of any other Person.
(e) In
a status report provided to the Senior Collateral Agent on a quarterly basis
(“Quarterly Status
Report”), such Grantor will indicate whether any application or
registration relating to any material Intellectual Property has been forfeited,
abandoned or dedicated to the public, or of any such determination or
development (including, without limitation, the institution of, or any such
determination or development in, any proceeding in the United States Patent and
Trademark Office, the United States Copyright Office or any court or tribunal in
any
11
country)
regarding such Grantor’s ownership of, or the validity of, any material
Intellectual Property or such Grantor’s right to register the same or to own and
maintain the same.
(f) In
the Quarterly Status Report provided to the Senior Collateral Agent pursuant to
Section 4.06(e), such Grantor will report whenever such Grantor, either by
itself or through any agent, employee, licensee or designee, has filed an
application for the registration of any Intellectual Property with the United
States Patent and Trademark Office, the United States Copyright Office or any
similar office or agency in any other country or any political subdivision
thereof. Upon request of the Senior Collateral Agent, such Grantor
shall execute and deliver, and have recorded, any and all agreements,
instruments, documents and papers as the Senior Collateral Agent may request to
evidence the Senior Collateral Agent’s and Senior Secured Parties’ security
interest in any Copyright, Patent or Trademark and the goodwill and general
intangibles of such Grantor relating thereto or represented
thereby.
(g) Such
Grantor will take all reasonable and necessary steps, including in any
proceeding before the United States Patent and Trademark Office, the United
States Copyright Office or any similar office or agency in any other country or
any political subdivision thereof, to maintain and pursue each application (and
to obtain the relevant registration) and to maintain each registration of the
Intellectual Property material to the conduct of Grantor’s business, including
filing of applications for renewal, affidavits of use and affidavits of
incontestability.
(h) In
the event that any Intellectual Property material to the conduct of Grantor’s
business is infringed, misappropriated or diluted by a third party, such Grantor
shall (i) take such actions as such Grantor shall reasonably deem appropriate
under the circumstances to protect such Intellectual Property and (ii) if such
Intellectual Property is of material economic value, promptly notify the Senior
Collateral Agent after it learns thereof and take all reasonable steps to
protect its interests, which may include bringing suit for infringement,
misappropriation or dilution, to seek injunctive relief where appropriate and to
recover any and all damages for such infringement, misappropriation or
dilution.
SECTION
4.07. Cash
Management System. (a) The Grantors shall at all times
maintain, and each Subsidiary Guarantor shall comply with its obligations under,
the Cash Management System.
(b) Each
Grantor shall use its commercially reasonable efforts to cause any applicable
third party to effectuate the Cash Management System.
SECTION
5. Provisions Relating to
Accounts.
SECTION
5.01. Grantors Remain Liable under
Accounts. Anything herein to the contrary notwithstanding, a
Grantor shall remain liable under each of the Accounts to observe and perform
all the material conditions and material obligations to be observed and
performed by it thereunder, all in accordance with the terms of any agreement
giving rise to each such Account. No Senior Secured Party shall have
any obligation or liability under any Account (or any agreement giving rise
thereto) by reason of or arising out of this Agreement or the receipt by the
Senior Collateral Agent or any Senior Secured Party of any payment relating to
such Account pursuant hereto, nor shall any Senior Secured Party be obligated in
any manner to perform any of
12
the
obligations of a Grantor under or pursuant to any Account (or any agreement
giving rise thereto), to make any payment, to make any inquiry as to the nature
or the sufficiency of any payment received by it or as to the sufficiency of any
performance by any party under any Account (or any agreement giving rise
thereto), to present or file any claim, to take any action to enforce any
performance or to collect the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.
SECTION
5.02. Analysis of
Accounts. In addition to their rights under the Senior Credit
Agreement, the Borrowing Base Agent shall have the right upon the occurrence and
during the continuance of an Event of Default to make test verifications of the
Accounts in any manner and through any medium that they considers reasonably
advisable, and each Grantor shall furnish all such assistance and information as
the Borrowing Base Agent may reasonably require in connection with such test
verifications. At any time and from time to time upon the occurrence
and during the continuance of an Event of Default, upon the Borrowing Base
Agent’s reasonable request and at the expense of each Grantor, each Grantor
shall immediately request and use commercially reasonable efforts to cause
independent public accountants or others reasonably satisfactory to the
Borrowing Base Agent to furnish to the Borrowing Base Agent reports showing
reconciliations, aging and test verifications of, and trial balances for, the
Accounts. Upon the occurrence and during the continuance of an Event
of Default, the Senior Collateral Agent in its own name or in the name of others
may communicate with Account Debtors on the Accounts to verify with them to the
Borrowing Base Agent’s reasonable satisfaction the existence, amount and terms
of any Accounts and to direct all payments to the Senior Collateral
Agent. To the extent reasonably practicable the Borrowing Base Agent
will seek to take such actions through third parties.
SECTION
5.03. Collections on
Accounts. (a) The Senior Collateral Agent hereby
authorizes each Grantor to collect the Accounts, and the Senior Collateral Agent
may curtail or terminate said authority at any time after the occurrence and
during the continuance of an Event of Default. If required by the
Senior Collateral Agent at any time after the occurrence and during the
continuance of an Event of Default, any payments of Accounts, when collected by
a Grantor during the continuance of such an Event of Default, (i) shall be
forthwith (and, in any event, within two Business Days) deposited by such
Grantor in the exact form received, duly indorsed by such Grantor to the Senior
Collateral Agent if required, in a Senior Collateral Account maintained under
the sole dominion and control of and on terms and conditions reasonably
satisfactory to the Senior Collateral Agent, subject to withdrawal by the Senior
Collateral Agent as provided in Section 8.03, and (ii) until so turned over,
shall be held by such Grantor in trust for the Senior Secured Parties,
segregated from other funds of such Grantor.
(b) At
the Senior Collateral Agent’s request after the occurrence and during the
continuance of an Event of Default, each Grantor shall deliver to the Senior
Collateral Agent all original and other documents evidencing, and relating to,
the agreements and transactions which gave rise to the Accounts, including all
original orders, invoices and shipping receipts.
SECTION
5.04. Representations and
Warranties. As of the Restatement Effective Date, the place
where each Grantor keeps its records concerning the Accounts is at the location
listed in Schedule 1 hereto.
13
SECTION
5.05. Covenants. (a)
The amount represented by each Grantor to the Senior Secured Parties from time
to time as owing by each account debtor or by all Account Debtors in respect of
the Accounts shall at such time be in all material respects the correct amount
actually owing by such Account Debtor or debtors thereunder.
(b) Upon
the occurrence and during the continuance of an Event of Default, a Grantor
shall not grant any extension of the time of payment of any of the Accounts
Receivable, compromise, compound or settle the same for less than the full
amount thereof, release, wholly or partly, any Person liable for the payment
thereof, or allow any credit or discount whatsoever thereon other than
extensions, credits, discounts, compromises or settlements granted or made in
the ordinary course of business.
(c) Unless
a Grantor shall deliver prior written notice, identifying the change of location
for its books and records, such Grantor shall not remove its books and records
from the location specified in Schedule 1.
SECTION
5.06. Deposit
Accounts. For each deposit account that any Grantor at any
time opens or maintains, such Grantor shall, at the Senior Collateral Agent’s
request and option, pursuant to an agreement in form and substance satisfactory
to the Senior Collateral Agent, either (a) cause the depositary bank to
agree to comply at any time with instructions from the Senior Collateral Agent
to such depositary bank directing the disposition of funds from time to time
credited to such deposit account, without further consent of such Grantor, or
(b) arrange for the Senior Collateral Agent to become the customers of the
depositary bank with respect to the deposit account, with the Grantor being
permitted, only with the consent of the Senior Collateral Agent, to exercise
rights to withdraw funds from such deposit account. The provisions of
this paragraph shall not apply to (i) any deposit account for which any
Grantor, the depositary bank and the Senior Collateral Agent have entered into a
cash collateral agreement specially negotiated among such Grantor, the
depositary bank and the Senior Collateral Agent for the specific purpose set
forth therein and (ii) deposit accounts for which the Senior Collateral
Agent are the depositaries.
SECTION
6. Provisions Relating to
Contracts.
SECTION
6.01. Grantors Remain Liable under
Contracts. Anything herein to the contrary notwithstanding,
each Grantor shall remain liable under each Contract to observe and perform all
the conditions and obligations to be observed and performed by it thereunder,
all in accordance with and pursuant to the terms and provisions of such
Contract. No Senior Secured Party shall have any obligation or
liability under any Contract by reason of or arising out of this Agreement or
the receipt by any such Senior Secured Party of any payment relating to such
Contract pursuant hereto, nor shall any Senior Secured Party be obligated in any
manner to perform any of the obligations of a Grantor under or pursuant to any
Contract, to make any payment, to make any inquiry as to the nature or the
sufficiency of any payment received by it or as to the sufficiency of any
performance by any party under any Contract, to present or file any claim, to
take any action to enforce any performance or to collect the payment of any
amounts which may have been assigned to it or to which it may be entitled at any
time or times.
14
SECTION
6.02. Communication With Contracting
Parties. Upon the occurrence and during the continuance of an
Event of Default, the Senior Collateral Agent in their own names or in the name
of their nominees may communicate with parties to the Contracts to verify with
them to the Senior Collateral Agent’s reasonable satisfaction the existence,
amount and terms of any Contracts. To the extent reasonably
practicable the Senior Collateral Agent will seek to take such actions through
third parties.
SECTION
7. Remedies.
SECTION
7.01. Notice
to Account Debtors and Contract Parties. Upon the request of
the Senior Collateral Agent at any time after the occurrence and during the
continuance of an Event of Default, a Grantor shall notify Account Debtors on
the Accounts and parties to the Contracts that the Accounts and the Contracts
have been assigned to the Senior Collateral Agent for the ratable benefit of the
Senior Secured Parties and that payments in respect thereof during the
continuance of such an Event of Default shall be made directly to the Senior
Collateral Agent.
SECTION
7.02. Proceeds to be Turned Over To Senior
Collateral Agent. In addition to the rights of the Senior
Collateral Agent and the Senior Secured Parties specified in Section 5.03 with
respect to payments of Accounts, if an Event of Default shall occur and be
continuing all Proceeds received by a Grantor consisting of cash, checks and
other near-cash items shall upon the Senior Collateral Agent’s request be held
by such Grantor in trust for the Senior Secured Parties, segregated from other
funds of such Grantor, and shall, upon the Senior Collateral Agent’s request (it
being understood that the exercise of remedies by the Senior Secured Parties in
connection with an Event of Default under clauses (h) and (i) of
Article VII of the Senior Credit Agreement or, after the Senior Loan
Obligation Payment Date, the equivalent provision of any Additional Senior Debt
Document shall be deemed to constitute a request by the Senior Collateral Agent
for the purposes of this sentence) forthwith upon receipt by such Grantor, be
turned over to the Senior Collateral Agent in the exact form received by such
Grantor (duly indorsed by such Grantor to the Senior Collateral Agent, if
required) and held by the Senior Collateral Agent in a Senior Collateral Account
maintained under the sole dominion and control of the Senior Collateral Agent
and on terms and conditions reasonably satisfactory to the Senior Collateral
Agent. All Proceeds while held by the Senior Collateral Agent in a
Senior Collateral Account (or by such Grantor in trust for the Senior Collateral
Agent and the Senior Secured Parties) shall subject to Section 7.03 continue to
be held as collateral security for all the Senior Obligations and shall not
constitute payment thereof until applied as provided in Section
7.03.
SECTION
7.03. Application of
Proceeds. (a) So long as the Collateral Trust and
Intercreditor Agreement is in effect, following a Triggering Event (as defined
therein), the proceeds of any sale or other realization upon any Collateral will
be applied as set forth in the Collateral Trust and Intercreditor Agreement and,
if then in effect, the Senior Lien Intercreditor Agreement.
(b) At
all times when the Collateral Trust and Intercreditor Agreement is not in
effect, the proceeds of any sale or other realization upon any Collateral
following an Event of Default will be applied as soon as practicable after
receipt (i) if the Senior Lien Intercreditor Agreement
15
is
then in effect, as provided in Section 2.01 of the Senior Lien
Intercreditor Agreement and (ii) if the Senior Lien Intercreditor Agreement
is not then in effect, as follows:
FIRST:
to the Senior Collateral Agent in an amount equal to the fees and expenses of,
and reimbursements and indemnifications owed to, the Senior Collateral Agent
pursuant to this Agreement and the Senior Credit Agreement that are unpaid as of
the applicable date of receipt of such proceeds, and to any Senior Secured Party
which has theretofore advanced or paid any such fees and expenses of, and
reimbursements and indemnifications owed to, the Senior Collateral Agent in an
amount equal to the amount thereof so advanced or paid by such Senior Secured
Party pro rata based on the amount of such fees, expenses, reimbursements and
indemnifications (or such advances or payment);
SECOND:
to the Senior Collateral Agent to reimburse any amounts owing to the Senior
Collateral Agent pursuant to Section 8.03;
THIRD:
subject to Sections 1.01(b) and 2.01(d) and (e) of the Senior Lien Intercreditor
Agreement (if, at the relevant time, the Senior Lien Intercreditor Agreement is
in effect), to the Senior Collateral Agent, for distribution to the Senior
Secured Parties to be applied to the payment of the Senior Obligations then due
and owing, pro rata based on the amount of Senior Obligations then due and owing
(after giving effect to any payments previously made under this Section), until
the Senior Obligation Payment Date; and
FOURTH:
to Rite Aid and the Grantors or their successors or assigns, as their interests
may appear, or to whosoever may be lawfully entitled to receive the same or as a
court of competent jurisdiction may direct.
SECTION
7.04. Uniform Commercial Code
Remedies. If an Event of Default shall have occurred and be
continuing, the Senior Collateral Agent, on behalf of the Senior Secured Parties
may exercise, in addition to all other rights and remedies granted to them in
this Agreement and in any other instrument or agreement securing, evidencing or
relating to the Senior Obligations, all rights and remedies of a senior secured
party under the Uniform Commercial Code. Without limiting the
generality of the foregoing, the Senior Collateral Agent, without demand of
performance or other demand, presentment, protest, advertisement or notice of
any kind (except any notice required by law referred to below) to or upon a
Grantor or any other Person (all and each of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Senior Collateral,
or any part thereof, and/or may forthwith sell, lease, assign, give option or
options to purchase, or otherwise dispose of and deliver the Senior Collateral
or any part thereof (or contract to do any of the foregoing), in one or more
parcels at public or private sale or sales, at any exchange, broker’s board or
office of any Senior Secured Party or elsewhere upon such terms and conditions
as the Senior Collateral Agent may deem advisable and at such prices as they may
deem best, for cash or on credit or for future delivery without assumption of
any credit risk. Any Senior Secured Party shall have the right upon
any such public sale or sales, and, to the extent permitted by law, upon any
such private sale or sales, to purchase the whole or any part of the Senior
Collateral so sold, free of (to the extent permitted by law) any right or equity
of
16
redemption
in a Grantor, which right or equity is hereby, to the extent permitted by law,
waived or released. Each Grantor further agrees, at the Senior
Collateral Agent’s request, to assemble the Senior Collateral and make it
available to the Senior Collateral Agent at places which the Senior Collateral
Agent shall reasonably select, whether at such Grantor’s premises or
elsewhere. The Senior Collateral Agent shall apply the net proceeds
of any such collection, recovery, receipt, appropriation, realization or sale,
after deducting all reasonable costs and expenses incurred therein or incidental
to the care or safekeeping of any of such Senior Collateral or reasonably
relating to such Senior Collateral or the rights of the Senior Collateral Agent
and the Senior Secured Parties hereunder, including reasonable attorneys’ fees
and disbursements, to the payment in whole or in part of the Senior Obligations,
in accordance with Section 7.03, and only after such application and after the
payment by the Senior Collateral Agent of any other amount required by any
provision of law, including Section 9-615(a)(3) of the Uniform Commercial Code,
need the Senior Collateral Agent account for the surplus, if any, to such
Grantor. If any notice of a proposed sale or other disposition of
such Senior Collateral shall be required by law, such notice shall be in writing
and deemed reasonable and proper if given at least 10 days before such sale or
other disposition.
The
Senior Collateral Agent shall have absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Agreement. Upon any sale of the Senior Collateral by the Senior
Collateral Agent (including pursuant to a power of sale granted by statute or
under a judicial proceeding), the receipt of the Senior Collateral Agent or of
the officer making the sale shall be a sufficient discharge to the purchaser or
purchasers of the Senior Collateral so sold and such purchaser or purchasers
shall not be obligated to see to the application of any part of the purchase
money paid over to the Senior Collateral Agent or such officer or be answerable
in any way for the misapplication thereof.
SECTION
7.05. Grant
of License to Use Intellectual Property. For the purpose of
enabling the Senior Collateral Agent to exercise rights and remedies under this
Article at such time as the Senior Collateral Agent shall be lawfully entitled
to exercise such rights and remedies, each Grantor hereby grants to the Senior
Collateral Agent an irrevocable, non-exclusive license (exercisable without
payment of royalty or other compensation to the Grantors) to use, license or
sub-license any of the Senior Collateral consisting of Intellectual Property now
owned or hereafter acquired by such Grantor, and wherever the same may be
located, and including in such license reasonable access to all media in which
any of the licensed items may be recorded or stored and to all computer software
and programs used for the compilation or printout thereof. The use of
such license by the Senior Collateral Agent shall be exercised, at the option of
the Senior Collateral Agent, solely upon the occurrence and during the
continuation of an Event of Default; provided that any license,
sub-license or other transaction entered into by the Senior Collateral Agent in
accordance herewith shall be binding upon the Grantors notwithstanding any
subsequent cure of an Event of Default.
SECTION
7.06. Waiver;
Deficiency. Each Grantor shall remain liable for any
deficiency if the proceeds of any sale or other disposition of the Senior
Collateral are insufficient to pay the Senior Obligations and the reasonable
fees and disbursements of any attorneys employed by any Senior Secured Party to
collect such deficiency.
17
SECTION
7.07. Cash
Sweep Remedies. The Senior Collateral Agent, on behalf of the
Senior Secured Parties, are entitled to exercise all rights and remedies granted
to them in respect of the Cash Management Accounts in accordance with
Schedule 3 of this Agreement.
SECTION
8. Senior
Collateral Agent’s Appointment as Attorneys-in-Fact; Senior Collateral Agent’s
Performance of Grantors’ Obligations.
SECTION
8.01. Powers. Each
Grantor hereby irrevocably constitutes and appoints the Senior Collateral Agent
and any officer or agent thereof, with full power of substitution, during the
continuance of an Event of Default, as its true and lawful attorneys-in-fact,
with full irrevocable power and authority in the place and stead of such Grantor
and in the name of such Grantor or in their own name from time to time in the
Senior Collateral Agent’s discretion, for the purpose of carrying out the terms
of this Agreement, to take any and all appropriate action and to execute any and
all documents and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, and, without limiting the generality of the
foregoing, such Grantor hereby gives the Senior Collateral Agent the power and
right, on behalf of such Grantor, without notice to or assent by such Grantor,
to do the following upon the occurrence and during the continuance of an Event
of Default:
(a)
in the name of such Grantor or their own names, or otherwise, to take
possession of and indorse and collect any checks, drafts, notes, acceptances or
other instruments for the payment of moneys due under any Account, Instrument,
General Intangible or Contract or with respect to any other Senior Collateral
and to file any claim or to take any other action or proceeding in any court of
law or equity or otherwise deemed appropriate by the Senior Collateral Agent for
the purpose of collecting any and all such moneys due under any Account,
Instrument, General Intangible or Contract or with respect to any other Senior
Collateral whenever payable;
(b)
in the case of any Intellectual Property, execute and deliver, and have
recorded, any and all agreements, instruments, documents and papers as the
Senior Collateral Agent may request to evidence the Senior Collateral Agent’s
and the Senior Secured Parties’ security interest in such Intellectual Property
and the goodwill and general intangibles of such Grantor relating thereto or
represented thereby;
(c)
to pay or discharge taxes and Liens levied or placed on or threatened
against the Senior Collateral (other than Permitted Liens), to effect any
repairs or any insurance called for by the terms of this Agreement and to pay
all or any part of the premiums therefor and the costs thereof;
(d)
to execute, in connection with any sale provided for in
Section 7.04, any endorsements, assignments or other instruments of
conveyance or transfer with respect to the Senior Collateral;
(e)
(i) to direct any party liable for any payment under any of the Senior
Collateral to make payment of any and all moneys due or to become due thereunder
directly to the Senior Collateral Agent or as the Senior Collateral Agent shall
direct; (ii) to ask or demand for, collect, receive payment of and receipt for,
any and all moneys, claims and
18
other
amounts due or to become due at any time in respect of or arising out of any
Senior Collateral; (iii) to sign and indorse any invoices, freight or express
bills, bills of lading, storage or warehouse receipts, drafts against debtors,
assignments, verifications, notices and other documents in connection with any
of the Senior Collateral; (iv) to commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction to
collect the Senior Collateral or any thereof and to enforce any other right in
respect of any Senior Collateral; (v) to defend any suit, action or proceeding
brought against any Grantor with respect to any Senior Collateral; (vi) to
settle, compromise or adjust any such suit, action or proceeding and, in
connection therewith, to give such discharges or releases as the Senior
Collateral Agent may deem appropriate; (vii) to the extent permitted by
applicable law, assign any Copyright, Patent or Trademark (along with the
goodwill of the business to which any such Copyright, Patent or Trademark
pertains); and (viii) generally, to use, sell, transfer, pledge and make any
agreement with respect to or otherwise deal with any of the Senior Collateral as
fully and completely as though the Senior Collateral Agent were the absolute
owners thereof for all purposes, and to do, at the Senior Collateral Agent’s
option and at the expense of such Grantor, at any time, or from time to time,
all acts and things which the Senior Collateral Agent reasonably deem necessary
to protect, preserve or realize upon such Senior Collateral and the Senior
Collateral Agent’s and the Senior Secured Parties’ security interests therein
and to effect the intent of this Agreement, all as fully and effectively as such
Grantor might do; and
(f)
to file any Uniform Commercial Code financing statement, or to take such
other steps, required to perfect or confirm the perfection of any security
interest described herein.
SECTION
8.02. Performance by Senior Collateral
Agent of Grantor’s Obligations. If any Grantor fails to
perform or comply with any of its agreements contained herein, the Senior
Collateral Agent, at its option, but without any obligation so to do, may
perform or comply, or otherwise cause performance or compliance, with such
agreement.
SECTION
8.03. Grantor’s Reimbursement
Obligation. The expenses of the Senior Collateral Agent and
any other Senior Secured Party, as applicable, reasonably incurred in connection
with actions undertaken as provided in this Section 8, together with
interest thereon at a rate per annum equal to the Default Rate, from the date
payment is demanded by the Senior Collateral Agent to the date reimbursed by
such Grantor, shall be payable by the Borrower to the Senior Collateral Agent on
demand.
SECTION
8.04. Ratification; Power Coupled With An
Interest. Each Grantor hereby ratifies all that said attorneys
shall lawfully do or cause to be done by virtue hereof. All powers,
authorizations and agencies contained in this Agreement are coupled with an
interest and are irrevocable until this Agreement is terminated and the security
interests created hereby are released.
SECTION
9. Duty of
Senior Collateral Agent. The Senior Collateral Agent’s sole
duty with respect to the custody, safekeeping and physical preservation of the
Senior Collateral in its possession, under Section 9-207 of the Uniform
Commercial Code or otherwise, shall be to deal
19
with
it in the same manner as the Senior Collateral Agent deals with similar property
for its own accounts. No Senior Secured Party nor any of its
respective directors, officers, employees or agents shall be liable for failure
to demand, collect or realize upon any of the Senior Collateral or for any delay
in doing so or shall be under any obligation to sell or otherwise dispose of any
Senior Collateral upon the request of a Grantor or any other Person or to take
any other action whatsoever with regard to the Senior Collateral or any part
thereof. The powers conferred on the Senior Secured Parties hereunder
are solely to protect the Senior Secured Parties’ interests in the Senior
Collateral and shall not impose any duty upon any Senior Secured Party to
exercise any such powers. The Senior Secured Parties shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
employees or agents shall be responsible to any Grantor for any act or failure
to act hereunder, except for their own gross negligence or wilful
misconduct.
SECTION
10. Authority of Senior Collateral
Agent. Each Grantor acknowledges that the rights and
responsibilities of the Senior Collateral Agent under this Agreement with
respect to any action taken by the Senior Collateral Agent or the exercise or
non-exercise by the Senior Collateral Agent of any option, voting right,
request, judgment or other right or remedy provided for herein or resulting or
arising out of this Agreement shall, as between the Senior Collateral Agent and
the other Senior Secured Parties, be governed by the Senior Credit Agreement and
by such other agreements with respect thereto as may exist from time to time
among them but, as between the Senior Collateral Agent and the Grantors, the
Senior Collateral Agent shall be conclusively presumed to be acting as co-agents
for the other Senior Secured Parties with full and valid authority so to act or
refrain from acting.
SECTION
11. Notices. All
notices, requests and demands to or upon the Senior Secured Parties or the
Grantors under this Agreement shall be given or made in accordance with Section
9.01 of the Senior Credit Agreement and addressed as follows:
(a)
if to the Senior Collateral Agent, in accordance with Section 9.01
of the Senior Credit Agreement;
(b)
if to any Grantor, c/o the Borrower in accordance with Section 9.01
of the Senior Credit Agreement; provided, however, that after
the Senior Loan Obligation Payment Date, all such notices, requests and demands
shall be given or made in accordance with the Additional Senior Debt Documents
pursuant to which the Additional Senior Debt Obligations of the Controlling
Secured Parties (as defined in the Senior Lien Intercreditor Agreement) were
incurred.
SECTION
12. Security
Interest Absolute. All rights of the Senior Collateral Agent
hereunder, the security interest and all obligations of the Grantors hereunder
shall be absolute and unconditional.
SECTION
13. Survival
of Agreement. All covenants, agreements, representations and
warranties made by any Grantor herein and in the certificates or other
instruments prepared or delivered in connection with or pursuant to this
Agreement or any other Senior Debt Document shall be considered to have been
relied upon by the Senior Secured Parties and shall survive the making by the
Senior Lenders of the Loans, the extension of any other credit constituting
Senior
20
Obligations,
the execution and delivery to the Senior Secured Parties of the Senior Debt
Documents and the issuance of any Letters of Credit or other letter of credit if
the Borrower’s or any Subsidiary’s obligations in respect thereof constitute
Senior Obligations, regardless of any investigation made by the Senior Secured
Parties or on their behalf, and shall continue in full force and effect as long
as the principal of or any accrued interest on any Loan or LC Disbursement or
any Additional Senior Debt, or any other Senior Obligation is outstanding and
unpaid and so long as any Letter of Credit or other letter of credit if the
Borrower’s or any Subsidiary’s obligations in respect thereof constitute Senior
Obligations is outstanding and so long as the Commitments or any other
commitments to provide Additional Senior Debt have not been
terminated.
SECTION
14. WAIVER
OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION, ACTION OR OTHER PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER
SENIOR DEBT DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY LITIGATION,
ACTION OR OTHER PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE OTHER SENIOR DEBT DOCUMENTS, AS APPLICABLE, BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION
14.
SECTION
15. Jurisdiction; Consent to Service of
Process. (a) Each Grantor hereby
irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of any
New York State court or Federal court of the
United States of America sitting in
New York City, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this
Agreement or the other Senior Debt Documents, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such
New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall
affect any right that any Obligor or any Senior Secured Party may otherwise have
to bring any action or proceeding relating to this Agreement or the other Senior
Debt Documents against any Grantor or any Senior Secured Party or its properties
in the courts of any jurisdiction.
(b) Each
Grantor and each Senior Secured Party hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or the other
Senior Debt Documents in any
New York State or Federal court. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
21
(c) Each
party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 11. Nothing in this Agreement will
affect the right of any party to this Agreement to serve process in any other
manner permitted by law.
SECTION
16. Release. (a) This Agreement and
the security interest created hereunder shall terminate when all Senior
Obligations have been fully and indefeasibly paid and when the Senior Secured
Parties have no further Commitments under the Senior Credit Agreement and no
further commitments to provide Additional Senior Debt and no Letters of Credit
(or other letters of credit if the Borrower’s or any Subsidiary’s obligations in
respect thereof constitute Additional Senior Debt Obligations) are outstanding
(except pursuant to cash collateral arrangements satisfactory to the Senior
Collateral Agent or other applicable Senior Representatives), at which time the
Senior Collateral Agent shall execute and deliver to each Grantor, or to such
Person or Persons as such Grantor shall reasonably designate, all Uniform
Commercial Code termination statements and similar documents prepared by such
Grantor at its expense which such Grantor shall reasonably request to evidence
such termination. Any execution and delivery of termination
statements or documents pursuant to this Section 16(a) shall be without
recourse to or warranty by the Senior Collateral Agent.
(b) All
Senior Collateral used, sold, transferred or otherwise disposed of in accordance
with the terms of the Senior Facilities and the Collateral Trust and
Intercreditor Agreement (including pursuant to a waiver or amendment of the
terms thereof) shall be used, sold, transferred or otherwise disposed of free
and clear of the Lien and the security interest created hereunder. In
connection with the foregoing, (i) the Senior Collateral Agent shall execute and
deliver to each Grantor, or to such Person or Persons as such Grantor shall
reasonably designate, all Uniform Commercial Code termination statements and
similar documents prepared by such Grantor at its expense which such Grantor
shall reasonably request to evidence the release of the Lien and security
interest created hereunder with respect to such Senior Collateral and (ii) any
representation, warranty or covenant contained herein relating to such Senior
Collateral shall no longer be deemed to be made with respect to such used, sold,
transferred or otherwise disposed Senior Collateral.
SECTION
17. Severability. Any
provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. The parties hereunder shall endeavor in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions, the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable
provisions.
SECTION
18. Amendments in Writing; No
Waiver. xiii)None of the terms or
provisions of this Agreement may be waived, amended, supplemented or otherwise
modified except by a written instrument executed by the Grantors and the Senior
Collateral Agent, provided that any provision
of this Agreement may be waived by the Majority Senior Parties pursuant to a
letter or agreement executed by the Senior Collateral Agent or by telecopy
transmission from the Senior Collateral Agent.
22
(b) No
Senior Secured Party shall by any act (except by a written instrument pursuant
to Section 18(a) hereof) or delay be deemed to have waived any right or
remedy hereunder or to have acquiesced in any Default or Event of Default or in
any breach of any of the terms and conditions hereof. No failure to
exercise, nor any delay in exercising, on the part of any Senior Secured Party,
any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or
privilege hereunder shall preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. A waiver by any
Senior Secured Party of any right or remedy hereunder on any one occasion shall
not be construed as a bar to any right or remedy which such Senior Secured Party
would otherwise have on any future occasion.
SECTION
19. Remedies
Cumulative. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other rights or remedies provided by law.
SECTION
20. Section
Headings. The section headings used in this Agreement are for
convenience of reference only and are not to affect the construction hereof or
be taken into consideration in the interpretation hereof.
SECTION
21. Successors and
Assigns. This Agreement shall be binding upon the successors
and assigns of each Grantor and shall inure to the benefit of each Grantor and
the Senior Secured Parties and their successors and assigns, provided that this
Agreement may not be assigned by any Grantor without the prior written consent
of the Senior Collateral Agent.
SECTION
22. GOVERNING
LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.
SECTION
23. Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall
constitute an original but all of which when taken together shall constitute but
one contract. Delivery of an executed counterpart of a signature page
of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.
SECTION
24. Additional
Grantors. Pursuant to Section 5.11 of the Senior Credit
Agreement or comparable provisions of Additional Senior Debt Facilities, certain
wholly owned Domestic Subsidiaries that were not in existence or not a Domestic
Subsidiary on the 2009 Restatement Effective Date are required to enter into
this Agreement as a Grantor upon becoming a Domestic Subsidiary. Upon
execution and delivery, after the 2009 Restatement Effective Date, by the Senior
Collateral Agent and such a Domestic Subsidiary of an instrument in the form of
Annex 1, such Domestic Subsidiary shall (a) become a Grantor hereunder with
the same force and effect as if originally named as a Grantor hereunder and
(b) become a Subsidiary Guarantor under the Senior Lien Intercreditor
Agreement, if then in effect, with the same force and effect as if originally
named as a Subsidiary Guarantor under the Senior Lien Intercreditor
Agreement. The execution and delivery of any such instrument shall
not require the consent of any Grantor hereunder or any Subsidiary Guarantor
under such Consent. The rights and
23
obligations
of each Grantor hereunder shall remain in full force and effect notwithstanding
the addition of any new Grantor as a party to this Agreement.
SECTION
25. Patient
Confidentiality. The Senior Collateral Agent hereby agrees on
behalf of itself and each Senior Secured Party and any of their designees and
assigns to, and shall take all reasonable steps to, comply with all applicable
state or federal laws or administrative regulations regarding the
confidentiality of patient records and patient medical information they receive
in connection with the transactions described in this Agreement.
SECTION
26. Collateral Trust and Intercreditor
Agreement. Notwithstanding anything herein to the contrary,
the terms of this Agreement, and the rights of the Senior Collateral Agent and
the Senior Secured Parties hereunder, are subject to the Collateral Trust and
Intercreditor Agreement and, if then in effect, the Senior Lien Intercreditor
Agreement.
SECTION
27. Resignation of Senior Collateral
Agent. The Senior Collateral Agent may at any time resign as
Senior Collateral Agent under this Agreement on the terms and subject to the
conditions set forth in Section 4.06 of the Senior Lien Intercreditor Agreement,
if then in effect, and otherwise in accordance with Article VIII of the
Senior Credit Agreement or, after the Senior Loan Obligation Payment Date, with
the equivalent provision of the Additional Senior Debt Documents pursuant to
which the Additional Senior Debt Obligations of the Controlling Secured Parties
(as defined in the Senior Lien Intercreditor Agreement) were
incurred.
24
IN
WITNESS WHEREOF, the undersigned has caused this Senior Subsidiary Security
Agreement to be duly executed and delivered as of the date first above
written.
|
|
RITE AID
CORPORATION,
|
|
|
|
|
|
|
|
|
By:
|
/s/ Xxxxx Xxxxxxx
|
|
|
Name:
Xxxxx Xxxxxxx
|
|
|
Title:
Senior Executive Vice
President,
|
|
|
Chief Financial Officer and Chief
Administrative
Officer:
|
|
|
|
|
|
EACH OF THE SUBSIDIARIES LISTED ON
SCHEDULE A HERETO, as Grantors,
|
|
|
|
|
|
By:
|
/s/ Xxxx Xxxxxxxxx
|
|
|
Name:
Xxxx Xxxxxxxxx
|
|
|
Title:
Senior Vice President & Assistant Secretary
|
|
|
|
|
|
|
|
|
EACH OF THE SUBSIDIARIES LISTED ON
SCHEDULE B HERETO, as Grantors,
|
|
|
|
|
|
By:
|
/s/ Xxxx Xxxxxxxxx
|
|
|
Name:
Xxxx Xxxxxxxxx
|
|
|
Title:
Authorized Signatory
|
|
|
|
|
|
|
|
|
CITICORP NORTH AMERICA, INC., as
Senior Collateral Agent,
|
|
|
|
|
|
By
|
/s/ Xxxxxxx Xxxxxx
|
|
|
Name:
Xxxxxxx Xxxxxx
|
|
|
Title:
Vice President
|
|
|
|
|
|
|
25
Schedules:
|
Annex
2
|
Definitions
Annex
|
|
Schedule
A
|
Subsidiary
Guarantors
|
|
Schedule
B
|
Subsidiary
Guarantors
|
|
Schedule
1
|
Records
of Accounts
|
|
Schedule
2
|
Copyrights
and Copyright Licenses; Patents and Patent Licenses; and Trademarks and
Trademark Licenses
|
|
Schedule
3
|
Cash
Management System
|
|
Schedule
4
|
Form
of Blocked Account Agreement
|
|
Schedule
5
|
Form
of Lockbox Account Agreement
|
|
Schedule
6
|
Form
of Government Lockbox Account
Agreement
|
|
Schedule
7
|
Form
of Concentration Agreement
|
|
Schedule
8
|
Perfection
Certificate
|
Annex
1
to
the Senior Subsidiary
Security
Agreement
SUPPLEMENT
NO. dated as of
[ ]
(this “Supplement”) to
the Senior Subsidiary Security Agreement dated as of June 27, 2001 and
amended and restated as of June 5, 2009 (as amended, supplemented or otherwise
modified from time to time, the “Senior Subsidiary Security
Agreement”), between the SUBSIDIARY GUARANTORS identified on the
signature pages thereto and any other Person that becomes a Subsidiary Guarantor
(collectively, the “Grantors”), in favor of
CITICORP NORTH AMERICA, INC., a Delaware banking corporation (“CNAI”), as Senior Collateral
Agent.
A. Reference
is made to the (a) Senior Credit Agreement, dated as of June 27, 2001, as
amended and restated as of June 5, 2009 (as amended, supplemented or otherwise
modified from time to time, the “Senior Credit Agreement”),
among Rite Aid Corporation, a Delaware corporation (the “Borrower”), the lenders from
time to time party thereto (the “Senior Lenders”), CNAI, as
administrative agent for the Senior Lenders and the other agents party thereto
and (b) the Senior Subsidiary Security Agreement.
B. Capitalized
terms used herein and not otherwise defined shall have the meanings assigned to
such terms in the Senior Subsidiary Security Agreement, including the
Definitions Annex (as may be amended, supplemented or otherwise modified from
time to time) and the Senior Credit Agreement.
C. The
Grantors have entered into the Senior Subsidiary Security Agreement in order to
induce the Senior Lenders to make Loans and induce the Issuing Banks to issue
Letters of Credit pursuant to, and upon the terms and subject to the conditions
specified in, the Senior Credit Agreement and Additional Senior Debt Parties to
acquire Additional Senior Debt from, or otherwise extend credit constituting
Additional Senior Debt to, the Borrower. Pursuant to Section 5.11 of
the Senior Credit Agreement or comparable provisions of Additional Senior
Facilities, certain wholly owned Domestic Subsidiaries that were not in
existence or not a Domestic Subsidiary on the date thereof are required to enter
into the Senior Subsidiary Security Agreement as a Grantor upon becoming a
Domestic Subsidiary. Section 24 of the Senior Subsidiary Security
Agreement provides that additional Domestic Subsidiaries may become Grantors
under the Senior Subsidiary Security Agreement by execution and delivery of an
instrument in the form of this Supplement. The undersigned (the “New Grantor”) is a
wholly-owned Domestic Subsidiary and is executing this Supplement in accordance
with the requirements of the Senior Debt Documents to become a Grantor under the
Senior Subsidiary Security Agreement and to consent to the Senior Lien
Intercreditor Agreement and effect its agreement to comply with the terms of the
Consent of Subsidiary Guarantors dated June [ ],
2009, with respect to the Senior Lien Intercreditor Agreement in accordance with
Section 24 of the Senior Subsidiary Security Agreement in order to induce
the Senior
Lenders
to make additional Loans and the Issuing Banks to issue additional Letters of
Credit and the Additional Senior Debt Parties to acquire Additional Senior Debt
from, or otherwise extend credit constituting Additional Senior Debt to, the
Borrower and as consideration for Loans previously made, Letters of Credit
previously issued and Additional Senior Debt previously issued, incurred or
obtained.
Accordingly,
the Senior Collateral Agent and the New Grantor agree as follows:
SECTION
1. In accordance with Section 24 of the Senior Subsidiary
Security Agreement, the New Grantor by its signature below becomes a Grantor
under the Senior Subsidiary Security Agreement with the same force and effect as
if originally named therein as a Grantor and the New Grantor hereby agrees to
all the terms and provisions of the Senior Subsidiary Security Agreement
applicable to it as a Grantor thereunder. Each reference to a “Grantor” in the
Senior Subsidiary Security Agreement shall be deemed to include the New Grantor.
The Senior Subsidiary Security Agreement is hereby incorporated herein by
reference.
SECTION
2. The New Grantor represents and warrants to the Senior
Secured Parties that this Supplement has been duly authorized, executed and
delivered by it and constitutes its legal, valid and binding obligation,
enforceable against it in accordance with its terms, subject to the effects of
applicable bankruptcy, insolvency or similar laws affecting creditors’ rights
generally and equitable principles of general applicability.
SECTION
3. This Supplement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument. This Supplement shall
become effective when the Senior Collateral Agent shall have received
counterparts of this Supplement that, when taken together, bear the signatures
of the New Grantor and the Senior Collateral Agent.
SECTION
4. Except as expressly supplemented hereby, the Senior
Subsidiary Security Agreement shall remain in full force and
effect.
SECTION
5. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.
SECTION
6. In case any one or more of the provisions contained in this
Supplement should be held invalid, illegal or unenforceable in any respect,
neither party hereto shall be required to comply with such provision for so long
as such provision is held to be invalid, illegal or unenforceable, but the
validity, legality and enforceability of the remaining provisions contained
herein and in the Senior Subsidiary Security Agreement shall not in any way be
affected or impaired. The parties hereto shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.
2
SECTION
7. All communications and notices hereunder shall be in
writing and given as provided in Section 11 of the Senior Subsidiary
Security Agreement.
3
Annex
1
to
the Senior Subsidiary
Security
Agreement
IN
WITNESS WHEREOF, the New Grantor and the Senior Collateral Agent have duly
executed this Supplement to the Senior Subsidiary Security Agreement as of the
day and year first above written.
|
|
[NAME OF NEW
GRANTOR],
|
|
|
|
|
|
by
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
|
|
|
|
CITICORP NORTH AMERICA, INC., as
Senior Collateral Agent,
|
|
|
|
|
|
by
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
|
|
Annex
2
to
the Senior Subsidiary
Security
Agreement
DEFINITIONS
ANNEX
Schedule
A
to
the Senior Subsidiary
Security
Agreement
SUBSIDIARY
GUARANTORS
|
1.
|
000
Xxxxxxxx Xxxxxx Xxxxxxx, LLC
|
|
2.
|
0000
Xxxx Xxxxx Xxxxxx Xxxxx, Xxxxx, LLC
|
|
3.
|
1740
Associates, L.L.C.
|
|
4.
|
0000
Xxxxxx Xxxx Xxxx–Xxxxxxxxxx Corp.
|
|
5.
|
0000
Xxxxxxxxxxxx Xxxxxx Xxxx – Xxxxxxxxxxxx Xxxx,
Inc.
|
|
8.
|
5600
Superior Properties, Inc.
|
|
9.
|
000-000
Xxxxx Xx. Corp.
|
|
10.
|
000
Xxxxx Xxxxxxxx-Xxxxxx, Ohio, LLC
|
|
11.
|
Xxx
& Government Streets - Mobile, Alabama,
LLC
|
|
12.
|
Apex
Drug Stores, Inc.
|
|
13.
|
Broadview
and Wallings-Broadview Heights Ohio,
Inc.
|
|
14.
|
Xxxxxx
Pharmacy, Inc.
|
|
15.
|
Xxxxxxx
Xxxxxx xxx Xxxx Xxxxxx - Xxxxx, XX,
LLC
|
|
16.
|
Eagle
Managed Care Corp.
|
|
19.
|
EDC
Drug Stores, Inc.
|
|
20.
|
Eighth
and Water Streets – Urichsville, Ohio,
LLC
|
|
21.
|
England
Street-Asheland Corporation
|
|
24.
|
Xxxxxxxx
Drug Stores, Inc.
|
|
25.
|
Gettysburg
and Xxxxxx-Dayton, Ohio, LLC
|
|
27.
|
K
& B Alabama Corporation
|
|
28.
|
K
& B Louisiana Corporation
|
|
29.
|
K
& B Mississippi Corporation
|
|
30.
|
K
& B Services, Incorporated
|
|
31.
|
K
& B Tennessee Corporation
|
|
32.
|
K&B
Texas Corporation
|
|
34.
|
Keystone
Centers, Inc.
|
|
35.
|
Lakehurst
and Broadway Corporation
|
|
36.
|
Maxi
Drug North, Inc.
|
|
37.
|
Maxi
Drug South, L.P.
|
|
40.
|
Xxxxxxxx
& Chillicothe Roads – Chesterland,
LLC
|
|
42.
|
Xxxxxx
& Xxxxxxx, LLC
|
|
44.
|
Northline
& Xxx – Toledo – Southgate, LLC
|
|
45.
|
P.J.C.
Distribution, Inc.
|
|
46.
|
P.J.C.
Realty Co., Inc.
|
|
47.
|
Xxxxxx
Drive and Navy Boulevard Property
Corporation
|
2
|
48.
|
Paw
Paw Lake Road & Paw Paw Avenue–Coloma, Michigan,
LLC
|
|
50.
|
Perry
Distributors, Inc.
|
|
51.
|
Perry
Drug Stores, Inc.
|
|
52.
|
PJC
Dorchester Realty LLC
|
|
53.
|
PJC
East Lyme Realty LLC
|
|
54.
|
PJC
Haverhill Realty LLC
|
|
55.
|
PJC
Hermitage Realty LLC
|
|
56.
|
PJC
Hyde Park Realty LLC
|
|
57.
|
PJC
Lease Holdings, Inc.
|
|
58.
|
PJC
Manchester Realty LLC
|
|
59.
|
PJC
Mansfield Realty LLC
|
|
60.
|
PJC
New London Realty LLC
|
|
61.
|
PJC
of Cranston, Inc.
|
|
62.
|
PJC
of East Providence, Inc.
|
|
63.
|
PJC
of Massachusetts, Inc.
|
|
64.
|
PJC
of Rhode Island, Inc.
|
|
66.
|
P.J.C.
of West Warwick, Inc.
|
|
67.
|
PJC
Peterborough Realty LLC
|
|
68.
|
PJC
Providence Realty LLC
|
|
71.
|
PJC
Revere Realty LLC
|
|
72.
|
PJC
Special Realty Holdings, Inc.
|
3
|
76.
|
Rite
Aid Drug Palace, Inc.
|
|
77.
|
Rite
Aid Hdqtrs. Corp.
|
|
78.
|
Rite
Aid of Alabama, Inc.
|
|
79.
|
Rite
Aid of Connecticut, Inc.
|
|
80.
|
Rite
Aid of Delaware, Inc.
|
|
81.
|
Rite
Aid of Florida, Inc.
|
|
82.
|
Rite
Aid of Georgia, Inc.
|
|
83.
|
Rite
Aid of Illinois, Inc.
|
|
84.
|
Rite
Aid of Indiana, Inc.
|
|
85.
|
Rite
Aid of Kentucky, Inc.
|
|
86.
|
Rite
Aid of Maine, Inc.
|
|
87.
|
Rite
Aid of Maryland, Inc.
|
|
88.
|
Rite
Aid of Massachusetts, Inc.
|
|
89.
|
Rite
Aid of Michigan, Inc.
|
|
90.
|
Rite
Aid of New Hampshire, Inc.
|
|
91.
|
Rite
Aid of New Jersey, Inc.
|
|
92.
|
Rite
Aid of New York, Inc.
|
|
93.
|
Rite
Aid of North Carolina, Inc.
|
|
94.
|
Rite
Aid of Ohio, Inc.
|
|
95.
|
Rite
Aid of Pennsylvania, Inc.
|
|
96.
|
Rite
Aid of South Carolina, Inc.
|
|
97.
|
Rite
Aid of Tennessee, Inc.
|
4
|
98.
|
Rite
Aid of Vermont, Inc.
|
|
99.
|
Rite
Aid of Virginia, Inc.
|
|
100.
|
Rite
Aid of Washington, D.C., Inc.
|
|
101.
|
Rite
Aid of West Virginia, Inc.
|
|
102.
|
Rite
Aid Realty Corp.
|
|
103.
|
Rite
Aid Rome Distribution Center, Inc.
|
|
104.
|
Rite
Aid Services, L.L.C.
|
|
105.
|
Rite
Aid Transport, Inc.
|
|
107.
|
Seven
Mile and Evergreen – Detroit, LLC
|
|
108.
|
Silver
Springs Road – Baltimore, Maryland/One,
LLC
|
|
109.
|
Silver
Springs Road – Baltimore, Maryland/Two,
LLC
|
|
110.
|
State
& Fortification Streets – Jackson, Mississippi,
LLC
|
|
000.
|
Xxxxx
Xxxxxx and Hill Road – Xxxxxx, Ohio,
LLC
|
|
112.
|
The
Lane Drug Company
|
|
113.
|
Thrift
Drug Services, Inc.
|
|
116.
|
Thrifty
PayLess, Inc.
|
|
117.
|
Tyler
and Xxxxxxx Roads, Birmingham - Alabama,
LLC
|
5
Schedule
B
to
the Senior Subsidiary
Security
Agreement
SUBSIDIARY
GUARANTORS
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2.
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Rite
Investments Corp.
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3.
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Rite
Aid Hdqtrs. Funding, Inc.
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5.
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JCG
Holdings (USA), Inc.
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7.
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The
Xxxx Xxxxx Group (PJC) USA, Inc.
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Schedule
1
to
the Senior Subsidiary
Security
Agreement
RECORDS
OF ACCOUNTS
Description
Schedule
2
to
the Senior Subsidiary
Security
Agreement
COPYRIGHTS
REGISTRATIONS AND COPYRIGHT LICENSES
PATENTS
AND PATENT LICENSES
TRADEMARK
REGISTRATIONS AND TRADEMARK LICENSES
PENDING
ACTIONS
Schedule
3
to
the Senior Subsidiary
Security
Agreement
CASH
MANAGEMENT SYSTEM
SECTION
8. Accounts. (a)(i)
Unless such agreements are in full force and effect as of the Restatement
Effective Date, no later than 30 days after the Restatement Effective Date (or
such later date as may be agreed by the Borrowing Base Agent), each Grantor
shall, upon the request of the Borrowing Base Agent, cause:
(A)
each Blocked Account Bank to execute and deliver an updated Blocked
Account Agreement in respect of each Blocked Account; and
(B)
each Concentration Account Bank to execute and deliver an updated
Concentration Account Agreement in respect of the Concentration
Account.
(ii) In
addition, no later than 30 days after the termination of any Securitization or
Factoring Transaction (or such later date as may be agreed by the Senior
Collateral Agent), each Grantor shall, upon the request of the Senior Collateral
Agent, cause:
(C)
each Lockbox Account Bank to execute and deliver a new Lockbox Account
Agreement in respect of each Lockbox Account; and
(D)
each Government Lockbox Account Bank to execute and deliver a new
Government Lockbox Account Agreement in respect of each Government Lockbox
Account.
(b) On
each Business Day, each Grantor will transfer, directly or indirectly
substantially all of the funds credited to each of its depositary accounts in
same day funds, to a Blocked Account (including during a Cash Sweep Period) in
accordance with its customary business practice.
(c) After
the termination of any Securitization or Factoring Transaction, each Grantor
shall cause all payments in the Government Lockbox Account to be deposited into
the Lockbox Account as promptly as possible and in any event no later than the
Business Day on which such payments become available in the Government Lockbox
Account (including during a Cash Sweep Period).
(d) Except
as provided in the Senior Credit Agreement or, after the Senior Loan Obligation
Payment Date, the applicable Additional Senior Debt Document with respect to
Deposit Accounts relating to a Securitization or Factoring Transaction, each
Cash Management Account is, and shall remain, under the sole dominion and
control of the Senior Collateral Agent. Each Grantor acknowledges and agrees
that:
(i)
during a Cash Sweep Period such Grantor has no right of withdrawal from
any Cash Management Account except that:
(A)
the relevant Grantors shall be permitted to instruct any Blocked Account
Bank to transfer all amounts deposited in or credited to any Blocked Account to
the Concentration Account in accordance with the applicable Blocked Account
Agreement, and
(B)
the relevant Grantor shall be permitted to instruct the Concentration
Account Bank to transfer all amounts deposited in or credited to the
Concentration Account in accordance with the Concentration Account
Agreement;
(ii)
the funds on deposit in the Cash Management Accounts shall continue to be
collateral security for all of the Senior Obligations.
(e) Prior
to the delivery of a Cash Sweep Notice, the Grantor is free to withdraw funds on
deposit in or credited to the Blocked Accounts and the Concentration Account in
such amounts and with such frequency as the Grantor may from time to time
determine, without notice to or consent from the Senior Collateral
Agent.
SECTION
9. Cash
Sweep. (a) The Senior Collateral
Agent shall immediately be entitled to deliver Cash Sweep Notices upon the
conditions specified in Section 9.15(a) in the Senior Credit
Agreement.
(b) Upon
delivery of:
(i)
a Blocked Account Cash Sweep Notice from the Senior Collateral Agent, the
balance of each Blocked Account shall be forwarded to the Concentration Account,
each Business Day or the next Business Day (as permitted by the applicable
Blocked Account Agreement), in same day funds, for so long as such Blocked
Account Cash Sweep Notice shall be in effect; and
(ii)
a Concentration Account Cash Sweep Notice from the Senior Collateral
Agent, the balance of the Concentration Account shall be forwarded to a Citibank
Concentration Account, each Business Day (or the next Business Day (as permitted
by the Concentration Account Agreement)), in same day funds, for so long as such
Concentration Account Cash Sweep Notice shall be in effect.
(c) On
each Business Day during a Cash Sweep Period, the Senior Collateral Agent shall
use funds on deposit in any Citibank Concentration Account as
follows:
(i)
after the occurrence of a Triggering Event, in accordance with the
provisions of Section 4.01(a) of the Collateral Trust and Intercreditor
Agreement, as applicable; and
(ii)
at any other time, first, to repay the Revolving
Borrowings (without any Reduction of the Commitments) and second, to be deposited into
the Cash Sweep Cash Collateral Account for the benefit of the Senior Secured
Parties, as collateral for the payment and performance of the Senior
Obligations. The
2
Senior
Collateral Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over the Cash Sweep Cash Collateral
Account. Deposits in the Cash Sweep Cash Collateral Account shall be
invested in Permitted Investments, to be selected by the Senior Collateral Agent
in their sole discretion, and interest earned on such deposits shall be
deposited in such account as additional collateral for the payment and
performance of the Senior Obligations. Interest or profits, if any,
on such investments shall accumulate in such account. Upon
termination of any Cash Sweep Period, funds in the Cash Sweep Cash Collateral
Account shall be released to the Concentration Account within three Business
Days after the end of such Cash Sweep Period.
(d) The
Senior Collateral Agent shall be required to automatically rescind any Cash
Sweep Notice upon the conditions specified in Section 9.15(b) of the Senior
Credit Agreement.
(e) The
Senior Collateral Agent reserves the right to send as many Cash Sweep Notices to
the extent that it is entitled to do so under paragraph (a) of this Section
2.
SECTION
10. Collections. (a) Each Grantor agrees to notify and
direct promptly
(i)
subject to paragraph (ii) below, each Account Debtor and every other
Person obligated to make payments to any Blocked Account or Deposit Account, as
applicable, to make all such payments to such Blocked Account or Deposit
Account, as applicable; provided that, prior to the termination of any
Securitization or Factoring Transaction, only Account Debtors making payment in
respect of Securitization Assets or Factoring Assets shall be notified to make
payments to Deposit Account number 0000000. Each Grantor shall
use all commercially reasonable efforts to cause each Account Debtor and every
other Person identified in the preceding sentence to make all payments owing to
any Grantor to a Blocked Account or Deposit Account, as applicable;
and
(ii)
each Account Debtor which is a Governmental Authority (and only such
Account Debtors) to make all payments owing to any Grantor to the Government
Lockbox Account.
(b) In
the event that any Grantor directly receives any remittances or payments on
Accounts Receivable or any other obligation, notwithstanding the arrangements
for payment directly into the Blocked Accounts or the Deposit Accounts, such
remittances and payments shall be held in trust for the benefit of the Senior
Collateral Agent and the other Senior Secured Parties and shall be segregated
from other funds of such Grantor, subject to the Lien granted by the Senior
Subsidiary Security Agreement, and such Grantor shall cause such remittances and
payments to be deposited into the applicable Blocked Account or Deposit Account
as soon as practicable after such Grantor’s receipt thereof. The
foregoing provisions of this paragraph shall not apply to any Securitization
3
Assets
or Factoring Assets that have been transferred pursuant to a Securitization or
Factoring Transaction permitted by the terms of the Senior Credit
Agreement.
SECTION
11. Accounts. (a) The following are the Blocked
Accounts:
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Blocked
Account Bank
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Account
Numbers
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(b) The
following are the initial Deposit Accounts:
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Account
Holder
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Account
Details
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(c) The
following is the Concentration Account:
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Account
Holder
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Account
Details
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4
Schedule
4
to
the Senior Subsidiary
Security
Agreement
[FORM
OF]
BLOCKED
ACCOUNT AGREEMENT
[Date]
[Blocked
Account Bank]
[address]
Ladies
and Gentlemen:
Reference
is made to (a) account no.
[ ]
maintained with you (the “Blocked Account Bank”) by
[ ]
(the “Grantor”) into
which funds are deposited from time to time (the “Blocked Account”) and (b) the
Senior Subsidiary Security Agreement dated as of June 27, 2001 and amended
and restated as of June 5, 2009 (as amended, supplemented or otherwise modified
from time to time, the “Senior
Subsidiary Security Agreement”), among the Subsidiary
Guarantors (such term and each other capitalized term used but not defined
herein having the meaning assigned to such term in the Senior Subsidiary
Security Agreement, including the Definitions Annex, the Senior Credit Agreement
and, after the Senior Loan Obligation Payment Date, the applicable Additional
Senior Debt Document) and the Senior Collateral Agent.
Pursuant
to the Senior Subsidiary Security Agreement, the Grantor has granted to the
Senior Collateral Agent, for the benefit of the Senior Secured Parties, a
perfected security interest in certain property of the Grantor, including, the
Blocked Account.
The
Grantor hereby transfers to the Senior Collateral Agent exclusive ownership and
control of, and all of its right, title and interest in and to, the Blocked
Account and all funds and other property on deposit therein. By executing this
Blocked Account Agreement, the Blocked Account Bank acknowledges that the Senior
Collateral Agent now have exclusive ownership and control of the Blocked
Account, that all funds in the Blocked Account shall be transferred to the
Senior Collateral Agent as provided herein, that the Blocked Account is being
maintained by the Blocked Account Bank for the benefit of the Senior Collateral
Agent and that all amounts and other property therein are held by the Blocked
Account Bank as custodian for the Senior Collateral Agent.
Except
as provided in paragraphs (e), (f) and (l) below, the Blocked Account shall not
be subject to deduction, setoff, banker’s lien, counterclaim, defense,
recoupment or any other right in favor of any Person or entity other than the
Senior Collateral Agent. By executing this Blocked Account Agreement the Blocked
Account Bank also acknowledges that, as of the date hereof, the Blocked Account
Bank has received no
notice
of any other pledge or assignment of the Blocked Account and the Blocked Account
Bank agrees with the Senior Collateral Agent as follows:
(a)
Notwithstanding anything to the contrary or any other agreement relating
to the Blocked Account, the Blocked Account is and will be maintained for the
benefit of the Senior Collateral Agent, will be entitled “Citicorp North America, Inc., as
Senior Collateral Agent under the Senior Subsidiary Security Agreement dated as
of June 27, 2001 and amended and restated as of June 5, 2009
Account” and will be subject to
written instructions only from an authorized officer of the Senior Collateral
Agent (except as expressly provided otherwise herein).
(b)
The Blocked Account Bank agrees to give the Senior Collateral Agent
prompt notice if the Blocked Account shall become subject to any writ, judgment,
warrant of attachment, execution or similar process.
(c)
[A post office box (the “Lockbox”) has been rented in the name
of the Grantor at the
[
post office and the address to be used for such Lockbox is:
[Insert
address]
The
Blocked Account Bank’s authorized representatives will have access to the
Lockbox under the authority given by the Grantor to the post office and will
make regular pick-ups from the Lockbox timed to gain maximum benefit of early
presentation and availability of funds. The Blocked Account Bank will
endorse and process all checks received in the Lockbox and deposit such checks
(to the extent eligible) in the Blocked Account in accordance with the
procedures set forth below .]
(d)
The Blocked Account Bank will follow its operating procedures for the
handling of any [checks received from the Lockbox] or other remittance received
in the Blocked Account that contains restrictive endorsements, irregularities
(such as a variance between the written and numerical amounts), undated or
postdated items, missing signatures, incorrect payees and the like.
(e)
The Blocked Account Bank will endorse and process all eligible checks and
other remittance items not covered by paragraph (d) and deposit such checks and
remittance items in the Blocked Account.
(f)
The Blocked Account Bank will mail all checks returned unpaid because of
uncollected or insufficient funds under appropriate advice to the Grantor (with
a copy of the notification of return to the Senior Collateral Agent). The
Blocked Account Bank may charge the Blocked Account for the amounts of any
returned check that has been previously credited to the Blocked Account. To the
extent insufficient funds remain in the Blocked Account to cover any such
2
returned
check, the Grantor shall indemnify the Blocked Account Bank for the uncollected
amount of such returned check upon your demand.
(g)
The Blocked Account Bank will maintain a record of all checks and other
remittance items received in the Blocked Account on a daily basis and, in
addition to providing the Grantor with photostatic copies thereof, vouchers,
enclosures and the like of such checks and remittance items, furnish to the
Senior Collateral Agent a monthly statement setting forth the amounts deposited
in and withdrawn from the Blocked Account and shall furnish such other
information relating to the Blocked Account at such times as shall be reasonably
requested by the Senior Collateral Agent to: Citicorp North America,
Inc., as Senior Collateral Agent,
[ ], Attention:
[ ],
with a copy to the Grantor.
(h)
Prior to the delivery of a written notice from the Senior Collateral
Agent in the form of Exhibit A hereto (the “Blocked Account Cash Sweep
Notice”), the Grantor is free to withdraw funds from the Blocked Account
in such amounts and with such frequency as the Grantor may from time to time
determine, without notice to or consent from the Senior Collateral
Agent.
(i)
From and after delivery to the Blocked Account Bank of a Blocked Account
Cash Sweep Notice and until the Blocked Account Bank is notified in writing by
the Senior Collateral Agent that the Blocked Account Cash Sweep Notice is no
longer in effect (a “Blocked
Account Cash Sweep Period”), the Grantor will have no control over the
use of, or any right to withdraw any amount from, to draw upon, or to otherwise
exercise any power with respect to the Blocked Account, except that the Grantor
shall be permitted to instruct the Blocked Account Bank only with respect to the
transfer of funds from the Blocked Account to the Concentration Account (as
defined below) in accordance with paragraph (k) below.
(j)
During a Blocked Account Cash Sweep Period, the Blocked Account Bank
shall transfer, in same day funds, on each Business Day, all funds, if any on
deposit in, or otherwise to the credit of, the Blocked Account to the account
listed below (the “Concentration Account”) in
accordance with paragraph (k) below, provided that funds on
deposit that are subject to collection may be transmitted promptly upon
collection:
ABA
Number:
[name
and address of Grantor’s bank]
Account
Name:
Concentration Account
Account
Number:
Reference:
Attn:
3
or
to such other account as the Senior Collateral Agent may from time to time, or
at any time, designate in writing.
(k)
During a Blocked Account Cash Sweep Period, (i) the Grantor shall provide
written instructions to the Blocked Account Bank on each Business Day to
transfer all funds on deposit in, or otherwise credited to, the Blocked Account
to the Concentration Account; (ii) to the extent there are any available
balances in the Blocked Account at the end of any Business Day which have not
been transferred pursuant to clause (i) of this paragraph, the Grantor shall
provide, on the next Business Day, written instructions for the transfer of such
available balances from the Blocked Account to the Concentration Account; and
(iii) if the Grantor does not provide the written instructions pursuant to
clause (ii) of this paragraph, the Blocked Account Bank shall automatically
initiate such transfer described in clause (ii) of this paragraph and all other
transfers from the Blocked Account to the Concentration Bank without further
direction from the Grantor until otherwise notified by the Senior Collateral
Agent.
(l)
All customary service charges and fees with respect to the Blocked
Account shall be debited to the Blocked Account. In the event insufficient funds
remain in the Blocked Account to cover such customary service charges and fees,
the Grantor shall pay and indemnify the Blocked Account Bank for the amounts of
such customary service charges and fees. Neither the Senior
Collateral Agent nor the Senior Secured Parties shall have any liability for the
payment of any such fees in respect of the Blocked Account.
This
letter agreement shall be binding upon and shall inure to the benefit of the
Blocked Account Bank, the Grantor, the Senior Collateral Agent, the Senior
Secured Parties referred to in the Senior Subsidiary Security Agreement and
their respective successors, transferees and assigns of any of the foregoing.
This letter agreement may not be modified or terminated except upon the mutual
consent of the Senior Collateral Agent, the Grantor and the Blocked Account
Bank. The Blocked Account Bank may terminate the letter agreement
only upon 45 days’ prior written notice to the Grantor and the Senior Collateral
Agent. The Senior Collateral Agent may terminate this letter agreement at any
time. So long as any Senior Obligations remain outstanding and the
Commitments are still outstanding, upon such termination the Blocked Account
Bank shall close the Blocked Account and transfer all funds in the Blocked
Account to the Senior Collateral Agent at the Concentration Account or as
otherwise directed by the Senior Collateral Agent. After any such
termination, the Blocked Account Bank shall nonetheless remain obligated
promptly to transfer to the Concentration Account or as the Senior Collateral
Agent may otherwise direct all funds and other property received in respect of
the Blocked Account.
This
letter agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which when taken together shall constitute
one and the same agreement. Delivery of an executed counterpart of a signature
page to this letter
4
agreement
by telecopier shall be effective as delivery of a manually executed counterpart
of this letter agreement.
This
letter agreement supersedes all prior agreements, oral or written, with respect
to the subject matter hereof and may not be amended, modified or supplemented
except by a writing signed by the Senior Collateral Agent, the Grantor and the
Blocked Account Bank.
This
letter agreement shall be governed by, and construed in accordance with, the law
of the State of New York.
5
Schedule
4
to
the Senior Subsidiary
Security
Agreement
Upon
acceptance of this letter agreement it will be the valid and binding obligation
of the Grantor, the Senior Collateral Agent, and the Blocked Account Bank, in
accordance with its terms.
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Very
truly yours,
[ ]
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By:
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Name:
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Title:
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CITICORP NORTH AMERICA, INC., as
Senior Collateral Agent,
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by
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Name:
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Title:
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Acknowledged
and agreed to as of
the
date first above written:
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[ ]
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By
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Name:
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Title:
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Exhibit
A
to
the Blocked Account Agreement
BLOCKED
ACCOUNT CASH SWEEP NOTICE
[Blocked
Account Bank]
[Address]
Re: Account
No. [ ] (the “Blocked Account”)
Ladies
and Gentlemen:
Reference
is made to the Blocked Account and that certain Blocked Account Agreement dated
June 27, 2001 and amended and restated as of June
[ ], 2009 (as amended, supplemented or otherwise modified
from time to time, the “Blocked Account Agreement”)
among the Blocked Account Bank, the Grantor and the Senior Collateral Agent. Capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to them
in the Blocked Account Agreement.
The
Senior Collateral Agent hereby notifies you that, in accordance with certain
provisions of the Senior Subsidiary Security Agreement, from and after the date
of this notice, you are hereby directed to transfer (by wire transfer or other
method of transfer mutually acceptable to you and the Senior Collateral Agent)
to the Senior Collateral Agent, in same day funds, on each Business Day, the
entire balance in the Blocked Account to the Concentration Account specified in
paragraph (j) of the Blocked Account Agreement (or to such other account as the
Senior Collateral Agent may from time to time, or at any time, designate in
writing) until you are notified in writing by the Senior Collateral Agent that
this Blocked Account Cash Sweep Notice is no longer effective.
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Very
truly yours,
CITICORP
NORTH AMERICA, INC, as Senior Collateral Agent,
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By:
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Name:
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Title:
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Schedule
5
to
the Senior Subsidiary
Security
Agreement
[FORM
OF]
LOCKBOX
ACCOUNT AGREEMENT
[Date]
[Mellon
Bank, N.A.
Document
Control Group Manager
000
Xxxx Xxxxxx
Xxxxxx
Client Service Center
Room
154-1380
Pittsburgh,
PA 15262-001]
Ladies
and Gentlemen:
Reference
is made to (a) account number [ ] and
corresponding lockbox and data automation system maintained with Mellon Bank,
N.A. (“you” or the
“Lockbox Account Bank”)
by [ ] (the “Grantor”) into which funds
are deposited from time to time (the “Lockbox Account”) and (b) the
Senior Subsidiary Security Agreement dated as of June 27, 2001 and amended
and restated as of June [ ], 2009
(as amended, supplemented or otherwise modified from time to time, the “Senior Subsidiary Security
Agreement”) among the Subsidiary Guarantors (such term and each other
capitalized term used but not defined herein having the meaning assigned to such
term in the Senior Subsidiary Security Agreement, including the Definitions
Annex and Senior Credit Agreement referred to therein) and the Senior Collateral
Agent.
The
Grantor hereby confirms its irrevocable and unconditional instruction to you
that, until receipt of a written notice from the Senior Collateral Agent to the
contrary, you shall follow exclusively the instructions of the Senior Collateral
Agent with respect to the Lockbox Account without further consent by the Grantor
or any other Person and that the Lockbox Account shall be under the sole
dominion and control of the Senior Collateral Agent. Notwithstanding
anything to the contrary or any other agreement relating to the Lockbox Account,
the Lockbox Account is and will be maintained for the benefit of the Senior
Collateral Agent, will be entitled “blocked account for the benefit of
Citicorp North America, Inc., as Senior Collateral Agent under the Senior
Subsidiary Agreement dated as of June 27, 2001 and amended and restated as of
June [ ], 2009 Account” and will be subject
to written instructions only from an authorized officer of the Senior Collateral
Agent.
The
Grantor also hereby notifies you that the Senior Collateral Agent shall be
irrevocably entitled to exercise any and all rights in respect of, or in
connection with, the Lockbox Account, including, without limitation, the right
to specify when payments are to be made out of, or in connection with, the
Lockbox Account. The Senior Collateral Agent hereby instructs you,
until you receive notice from the Senior Collateral Agent
changing
this instruction, to transfer, in same day funds, on each Business Day, all
funds, if any on deposit in, or otherwise to the credit of, the Lockbox Account
to the account listed below, provided that funds on
deposit in the Lockbox Account that are subject to collection may be transmitted
properly upon collection.
BA
Number:
[name
and address of Grantor’s bank]
Account
Name:
Concentration Account
for the Rite Aid Senior
Subsidiary Security
Agreement
Account
Number:
Reference:
Attn:
[or
to such other account as the Senior Collateral Agent and the Grantor may
designate in writing.]
The
Grantor also hereby notifies the Lockbox Account Bank that, as collateral
security for the Senior Obligations, the undersigned Subsidiary Guarantors
granted to the Grantor and the Grantor hereby assigns to the Senior Collateral
Agent a continuing security interest in (i) the Lockbox Account, (ii) all
contract rights and privileges in respect to the Lockbox Account, (iii) all
cash, checks, money orders and other items of value on deposit in the Lockbox
Account and (iv) all proceeds of the foregoing.
By
executing this Lockbox Account Agreement, and so long as the Grantor shall have
any obligations to the Senior Collateral Agent or their assigns, you irrevocably
agree not to assert, claim or endeavor to exercise, irrevocably bar and estop
yourself from asserting, claiming or exercising, and acknowledge that you have
not heretofore received a notice, writ, order or any form of legal process from
any other party asserting, claiming or exercising, any right of set-off,
banker’s lien, control or other purported form of claim with respect to the
Lockbox Account or funds or other items from time to time
therein. Except for your right to debit the Lockbox Account as
described herein, you hereby expressly subordinate all your rights to the
Lockbox Account or funds or other items therein, to all rights of the Senior
Collateral Agent.
All
customary fees, charges and expenses for the maintenance and provision of
services in conjunction with the Lockbox Account are the responsibility of the
Grantor. In the event that the Grantor does not pay such customary
fees, charges and expenses due to the Lockbox Account Bank within ten (10) days
after the due date, the Lockbox Account Bank is authorized to charge the Lockbox
Account for such fees. In addition, any overdrafts with respect to
the Lockbox Account shall be debited, at any time and from time to time, to the
Lockbox Account in such amounts as may be required to pay such overdrafts,
without recourse to the Senior Collateral Agent. The Senior
Collateral Agent shall have no right to the sums so debited by the Lockbox
Account Bank. In the
2
event
insufficient funds remain in the Lockbox Account to cover any overdrafts, the
Grantor shall pay and indemnify the Lockbox Account Bank for the amounts of any
overdrafts. The Senior Collateral Agent shall not have any liability
for the payment of any fees or charges in respect of the Lockbox Account,
including customary service charges and fees and any overdrafts.
The
Grantor and the Senior Collateral Agent agree that the Lockbox Account Bank may
debit the Lockbox Account for any items (including, but not limited to, checks,
drafts, Automatic Clearinghouse (ACH) credits or wire transfers or other
electronic transfers or credits) deposited or credited to the Lockbox Account
which may be returned or otherwise not collected and, subject to the preceding
paragraph, for all charges, fees, commissions and expenses incurred by the
Lockbox Account Bank in providing services or otherwise in connection
herewith. The Lockbox Account Bank may charge the Lockbox Account as
permitted herein at such times as are in accordance with the Lockbox Account
Bank’s customary practice for the chargeback of returned items and
expenses. In the event the Lockbox Account Bank is unable to obtain
sufficient funds for such charges to cover returned items, or reversed or
returned credits, or any other items not collected and any other charges,
expenses, or commissions incurred by the Lockbox Account Bank in providing the
services (referred to as a “cost” or “costs”), the Grantor shall indemnify the
Lockbox Account Bank for all amounts related to the above described costs
incurred by the Lockbox Account Bank. The Senior Collateral Agent
agrees that if there are insufficient funds in the Lockbox Account, the Grantor
has not reimbursed the Lockbox Account Bank for the amounts described in this
paragraph and the Lockbox Account Bank has transferred funds to the Senior
Collateral Agent, then the Senior Collateral Agent agrees to reimburse the
Lockbox Account Bank (for any returned items described in this paragraph but not
for charges, fees or commissions incurred therewith) within ten (10) business
days after demand by the Lockbox Account Bank. The Senior Collateral
Agent’s obligations under this paragraph shall terminate 120 days after the
termination of this Lockbox Account Agreement.
Notwithstanding
any other provision of this Lockbox Account Agreement, unless the Lockbox
Account Bank is grossly negligent or engages in wilful misconduct in performance
or non-performance in connection with this Lockbox Account Agreement and the
Lockbox Account, the Lockbox Account Bank shall not be liable to any Party
hereto or any other person or entity for any action or failure to act under or
in connection with this Lockbox Account Agreement. The Grantor agrees
to indemnify and hold the Lockbox Account Bank harmless from any claims,
damages, losses or expenses incurred by any party in connection herewith; in the
event the Lockbox Account Bank breaches the standard of care set forth herein,
the Grantor and the Senior Collateral Agent each expressly agrees that the
Lockbox Account Bank’s liability shall be limited to damages directly caused by
such breach and in no event shall the Lockbox Account Bank be liable for any
incidental, indirect, punitive or consequential damages or attorney’s fees
whatsoever.
Notwithstanding
any other provision of this Lockbox Account Agreement, the Lockbox Account Bank
shall not be liable for any failure, inability to perform, or delay in
performance hereunder, if such failure, inability, or delay is due to an act of
God, war,
3
civil
commotion, governmental action, fire, explosion, strikes, other industrial
disturbance, equipment malfunction, action, non-action or delayed action on the
part of the Grantor or the Senior Collateral Agent or of any other entity or any
other causes that are beyond the Lockbox Account Bank’s reasonable
control.
You
hereby represent that you have not, prior to the date hereof, entered into any
agreement (which is currently in effect) pursuant to which you agreed that you
would comply with instructions of any person (other than the Senior Collateral
Agent) directing disposition of the funds in the Lockbox Account.
You
agree to give the Senior Collateral Agent and the Grantor prompt notice if the
Lockbox Account becomes subject to any writ, judgment, warrant of attachment,
execution or similar process served upon you.
This
Lockbox Account Agreement may not be modified or terminated by the Grantor
unless, in the case of a modification, the prior written consent of the Senior
Collateral Agent and the Lockbox Account Bank is obtained and, in the case of
termination, the prior written consent of the Senior Collateral Agent is
obtained. The Lockbox Account Bank may terminate this Lockbox Account
Agreement upon thirty (30) days’ prior written notice to the Grantor and the
Senior Collateral Agent. The Senior Collateral Agent may terminate
this Lockbox Account Agreement at any time. Upon any such
termination, any collected and available balances in the Lockbox Account will be
transferred in accordance with the Senior Collateral Agent’s instructions, and
incoming mail with respect to the Lockbox Account received by the Lockbox
Account Bank after such termination shall be forwarded for a period
not to exceed ninety (90) days in accordance with the Senior Collateral Agent’s
instructions. The Grantor’s obligations under this Lockbox Account
Agreement to indemnify, hold harmless and pay amounts owed (and the Grantor’s
obligation to reimburse the Lockbox Account Bank for any returned items) shall
survive the termination of this Lockbox Account Agreement.
[This
Lockbox Account Agreement shall be governed by the laws of the State of New
York.]
The
terms and conditions of the services, attached as Exhibit A, is made part of
this Lockbox Account Agreement with respect to matters not explicitly covered in
this Lockbox Account Agreement. To the extent there is a conflict
between this Lockbox Account Agreement and the terms and conditions of services,
this Lockbox Account Agreement shall take precedence.
This
Lockbox Account Agreement shall become effective immediately upon its execution
by all parties hereto. Any notice permitted or required hereunder
shall be in writing and shall be deemed to have been duly given if sent by
Personal delivery, express or first class mail, or facsimile addressed, in the
case of notice to the Lockbox Account Bank, to:
4
[Mellon
Bank, N.A.
Document
Control Group Manager
Mellon
Client Service Center
000
Xxxx Xxxxxx
Xxxx
000-0000
Xxxxxxxxxx,
XX 00000-0000]
Phone: (000)
000-0000
Fax: (000)
000-0000
and,
in the case of notice to the Grantor, to:
00
Xxxxxx Xxxx
Xxxx
Xxxx, XX 00000
Phone:
[ ]
Fax:
[ ]
Attn:
Rite Aid Funding LLC/ Rite Aid Treasury
and,
in the case of notice to the Senior Collateral Agent to:
[ ]
Fax:
[ ]
Attn:
[ ]
or
to such other address or addresses as the party to receive notice may provide in
writing to the other party in accordance with this paragraph. The
Lockbox Account Bank shall have no duty or obligation to inquire into the
authenticity or effectiveness of any such notice received pursuant to this
Lockbox Account Agreement.
This
Lockbox Account Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which when taken together
shall constitute and are the same agreement. Delivery of an executed
counterpart of a signature page to this Lockbox Account Agreement by telecopier
shall be effective as delivery of a manually executed counterpart of this
Lockbox Account Agreement.
Please
agree to the terms of, and acknowledge receipt of, this Lockbox Account
Agreement by signing in the space provided below.
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Very
truly yours,
[NAME
OF SUBSIDIARY GUARANTOR]
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By:
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Name:
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Title:
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5
|
By:___________________,
on behalf of
each
of the above listed companies
|
By:____________________,
on behalf of
each
of the above listed companies
|
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| Name: |
Name:
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Agreed
and acknowledged:
[MELLON
BANK, N.A.]
By:__________________________
Name:
Title:
|
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CITICORP
NORTH AMERICA, INC., as Senior Collateral Agent,
By:__________________________
Name:
Title:
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6
Schedule
6
to
the Senior Subsidiary
Security
Agreement
GOVERNMENT
LOCKBOX ACCOUNT AGREEMENT
[Date]
[Mellon
Bank, N.A.
Document
Control Group Manager
Mellon
Client Service Center
500
Xxxx Xxxxxx
Xxxx
000-0000
Xxxxxxxxxx,
XX 05262-0001]
Ladies
and Gentlemen:
Reference
is made to (a) account no. [ ] and corresponding
lockbox and data automation system maintained with Mellon Bank, N.A. (“you” or the “Government Lockbox Account
Bank”) by
[ ]
(the “Grantor”) into
which funds are deposited from time to time (the “Government Lockbox”) and (b)
the Senior Subsidiary Security Agreement dated as of June 27, 2001 and
amended and restated as of June [ ], 2009 (as
amended, supplemented or otherwise modified from time to time, the “Senior Subsidiary Security
Agreement”), among the Subsidiary Guarantors (such term and each other
capitalized term used and not otherwise defined herein having the meaning
assigned to such term in the Senior Subsidiary Security Agreement including the
Definitions Annex and the Senior Credit Agreement referred to therein and, after
the Senior Loan Obligation Payment Date, the applicable Additional Senior Debt
Document) and the Senior Collateral Agent.
The
Grantor hereby provides the following revocable instruction with respect to the
Government Lockbox Account (the “Standing Revocable
Instruction”): the Government Lockbox Account Bank shall transfer from
the Government Lockbox Account daily, via a zero balance service as described in
the terms and conditions of the services, attached as Exhibit A, all available
funds held in the Government Lockbox Account to account no.
[ ] at Mellon Bank, N.A. in
the name of the Grantor for Citicorp North America, Inc., as Senior Collateral
Agent (which account is under the sole dominion and control of the Senior
Collateral Agent). This Standing Revocable Instruction is revocable
by the Grantor at any time and for any reason by providing written instructions
to the Government Lockbox Account Bank (with a copy to the Senior Collateral
Agent), signed by the undersigned (which writing may be by facsimile and upon
which you may conclusively rely), whereupon the Government Lockbox Account Bank
shall follow, without further inquiry, such contrary written instruction and not
the Standing Revocable Instruction, provided, however, that
revocation of such Standing Revocable Instruction shall not be effective until
the later of (a) three Business Days after it is given or (b) the date the
Grantor provides identification reasonably acceptable to the Senior Collateral
Agent and the Government Lockbox Account Bank of the collections then in the
Government Lockbox Account with respect to which the Obligor is a
Governmental
Entity and with respect to which the Obligor is not a Governmental Entity, in
which latter case the said revocation shall not be effective.
The
Grantor also hereby notifies the Government Lockbox Account Bank that, as
collateral security for the Senior Obligations, the undersigned Subsidiary
Guarantors granted to the Grantor and the Grantor hereby assigns to the Senior
Collateral Agent a continuing security interest in (i) the Government Lockbox
Account, (ii) all contract rights and privileges in respect to the Government
Lockbox Account, (iii) all cash, checks, money orders and other items of value
on deposit in the Government Lockbox Account and (iv) all proceeds of the
foregoing.
By
executing this Government Lockbox Account Agreement, and so long as the Grantor
shall have any obligations to the Senior Collateral Agent or their assigns, you
irrevocably agree not to assert, claim or endeavor to exercise, irrevocably bar
and estop yourself from asserting, claiming or exercising, and acknowledge that
you have not heretofore received a notice, writ, order or any form of legal
process from any other party asserting, claiming or exercising, any right of
set-off, banker’s lien, control or other purported form of claim with respect to
the Government Lockbox Account or funds or other items from time to time
therein. Except for your right to debit the Government Lockbox
Account as described herein, you hereby expressly subordinate all your rights to
the Government Lockbox Account or funds or other items therein, to all rights of
the Grantor and the Senior Collateral Agent.
All
customary fees, charges and expenses for the maintenance and provision of
services in conjunction with the Government Lockbox Account are the
responsibility of the Grantor. In the event that the Grantor does not
pay such customary fees, charges and expenses due to the Government Lockbox
Account Bank within ten (10) days after the due date, the Government Lockbox
Account Bank is authorized to charge the Government Lockbox Account for such
fees. In addition, any overdrafts with respect to the Government
Lockbox Account shall be debited, at any time and from time to time, to the
Government Lockbox Account in such amounts as may be required to pay such
overdrafts, without recourse to the Senior Collateral Agent. The
Senior Collateral Agent shall have no right to the sums so debited by the
Government Lockbox Account Bank. In the event insufficient funds
remain in the Lockbox Account to cover any overdrafts, the Grantor shall pay and
indemnify the Government Lockbox Account Bank for the amounts of any
overdrafts. The Senior Collateral Agent shall not have any
liability for the payment of any fees or charges in respect of the Government
Lockbox Account, including customary service charges and fees and any
overdrafts.
The
Grantor and the Senior Collateral Agent agree that the Government Lockbox
Account Bank may debit the Government Lockbox Account for any items (including,
but not limited to, checks, drafts, Automatic Clearinghouse (ACH) credits or
wire transfers or other electronic transfers or credits) deposited or credited
to the Government Lockbox Account which may be returned or otherwise not
collected and, subject to the preceding paragraph, for all charges, fees,
commissions and expenses incurred by the Government Lockbox Account Bank in
providing services or otherwise in connection herewith. The
Government Lockbox Account Bank may charge the Government Lockbox Account as
2
permitted
herein at such times as are in accordance with the Government Lockbox Account
Bank’s customary practice for the chargeback of returned items and
expenses. In the event the Government Lockbox Account Bank is unable
to obtain sufficient funds for such charges to cover returned items, or reversed
or returned credits, or any other items not collected and any other charges,
expenses, or commissions incurred by the Government Lockbox Account Bank in
providing the services (referred to as a “cost” or “costs”) the Grantor shall
indemnify the Government Lockbox Account Bank for all amounts related to the
above described costs incurred by the Government Lockbox Account
Bank. The Senior Collateral Agent agrees that if the Grantor has not
reimbursed the Government Lockbox Account Bank for the amounts described in this
paragraph and the Government Lockbox Account Bank has transferred funds to the
Senior Collateral Agent, then the Senior Collateral Agent agrees to reimburse
the Government Lockbox Account Bank (for any returned items described in this
paragraph but not for charges, fees or commissions incurred therewith) within
ten business days after demand by the Government Lockbox Account
Bank. The Senior Collateral Agent’s obligations under this paragraph
shall terminate 120 days after the termination of this Government Lockbox
Account Agreement.
Notwithstanding
any other provision of this Government Lockbox Account Agreement, unless the
Government Lockbox Account Bank is grossly negligent or engages in wilful
misconduct in performance or non-performance in connection with this Government
Lockbox Account Agreement and the Government Lockbox Account, the Lockbox
Account Bank shall not be liable to any Party hereto or any other person or
entity for any action or failure to act under or in connection with this Lockbox
Account Agreement. The Grantor agrees to indemnify and hold the
Government Lockbox Account Bank harmless from any claims, damages, losses or
expenses incurred by any party in connection herewith; in the event the
Government Lockbox Account Bank breaches the standard of care set forth herein,
the Grantor and the Senior Collateral Agent each expressly agrees that the
Government Lockbox Account Bank’s liability shall be limited to damages directly
caused by such breach and in no event shall the Government Lockbox Account Bank
be liable for any incidental, indirect, punitive or consequential damages or
attorney’s fees whatsoever.
Notwithstanding
any other provision of this Government Lockbox Account Agreement, the Government
Lockbox Account Bank shall not be liable for any failure, inability to perform,
or delay in performance hereunder, if such failure, inability, or delay is due
to an act of God, war, civil commotion, governmental action, fire, explosion,
strikes, other industrial disturbance, equipment malfunction, action, non-action
or delayed action on the part of the Grantor or the Senior Collateral Agent or
of any other entity or any other causes that are beyond the Government Lockbox
Account Bank’s reasonable control.
You
hereby represent that you have not, prior to the date hereof, entered into any
agreement (which is currently in effect) pursuant to which you agreed that you
would comply with instructions of any person (other than the Grantor and the
Senior Collateral Agent) directing disposition of the funds in the Government
Lockbox Account.
3
You
agree to give the Senior Collateral Agent and the Grantor prompt notice if the
Government Lockbox Account becomes subject to any writ, judgment, warrant of
attachment, execution or similar process served upon you.
This
Government Lockbox Account Agreement may not be modified or terminated by the
Grantor unless, in the case of a modification, the prior written consent of the
Senior Collateral Agent and the Government Lockbox Account Bank is obtained and,
in the case of termination, the prior written consent of the Senior Collateral
Agent is obtained. The Government Lockbox Account Bank may terminate
this Government Lockbox Account Agreement upon thirty (30) days’ prior written
notice to the Grantor and the Senior Collateral Agent. Upon any such
termination, any collected and available balances in the Government Lockbox
Account will be transferred in accordance with the Grantor’s instructions, and
incoming mail with respect to the Government Lockbox Account received by the
Government Lockbox Account Bank after such termination shall be
forwarded for a period not to exceed ninety (90) days in accordance
with the Senior Collateral Agent’s instructions. The Senior
Collateral Agent may terminate this Government Lockbox Account Agreement at any
time. The Grantor’s obligations under this Government Lockbox Account
Agreement to indemnify, hold harmless and pay amounts owed (and the Senior
Collateral Agent’s obligation to reimburse the Government Lockbox Account Bank
for any returned items) shall survive the termination of this Government Lockbox
Account Agreement.
This
Government Lockbox Account Agreement shall be governed by the laws of the State
of New York.
The
terms and conditions of the services, attached as Exhibit A, is made part of
this Government Lockbox Account Agreement with respect to matters not explicitly
covered in this Government Lockbox Account Agreement. To the extent
there is a conflict between this Government Lockbox Account Agreement and the
terms and conditions of services, this Government Lockbox Account Agreement
shall take precedence.
This
Government Lockbox Account Agreement shall become effective immediately upon its
execution by all parties hereto. Any notice permitted or required
hereunder shall be in writing and shall be deemed to have been duly given if
sent by personal delivery, express or first class mail, or facsimile addressed,
in the case of notice to the Government Lockbox Account Bank, to:
[Mellon
Bank, N.A.
Document
Control Group Manager
Mellon
Client Service Center
500
Xxxx Xxxxxx
Xxxx
000-0000
Xxxxxxxxxx,
XX 00000-0000
Phone:
(000) 000-0000
Fax:
(000) 000-0000]
4
and,
in the case of notice to the Grantor, to:
30
Xxxxxx Xxxx
Xxxx
Xxxx, XX 00000
Xhone:
[ ]
Fax:
[ ]
Attn:
Rite Aid Funding LLC/ Rite Aid Treasury
and,
in the case of notice to the Senior Collateral Agent, to:
[ ]
Fax:
[ ]
Attn:
[ ]
or
to such other address or addresses as the party to receive notice may provide in
writing to the other party in accordance with this paragraph. The
Government Lockbox Account Bank shall have no duty or obligation to inquire into
the authenticity or effectiveness of any such notice received pursuant to this
Government Lockbox Account Agreement.
This
Government Lockbox Account Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which when
taken together shall constitute and are the same agreement. Delivery
of an executed counterpart of a signature page to this Government Lockbox
Account Agreement by telecopier shall be effective as delivery of a manually
executed counterpart of this Government Lockbox Account Agreement.
Please
agree to the terms of, and acknowledge receipt of, this Government Lockbox
Account Agreement by signing in the space provided below.
|
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Very
truly yours,
[NAME
OF SUBSIDIARY GUARANTOR]
|
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By:
|
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Name:
|
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Title:
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5
|
By:___________________,
on behalf of
each
of the above listed companies
|
By:____________________,
on behalf of
each
of the above listed companies
|
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|
| Name: |
Name:
|
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|
|
Agreed
and acknowledged:
[MELLON
BANK, N.A.]
By:__________________________
Name:
Title:
CITICORP
NORTH AMERICA, INC., as Senior Collateral Agent,
By:__________________________
Name:
Title:
6
Schedule
7
to
the Senior Subsidiary
Security
Agreement
[FORM
OF]
CONCENTRATION
ACCOUNT AGREEMENT
[Date]
[Concentration
Account Bank]
[address]
Ladies
and Gentlemen:
Reference
is made to (a) account no.
[ ]
maintained with you (the “Concentration Account Bank”)
by
[ ]
(the “Grantor”) into
which funds are deposited from time to time (the “Concentration Account”) and
(b) the Senior Subsidiary Security Agreement dated as of June 27, 2001 and
amended and restated as of June [ ], 2009 (as amended,
supplemented or otherwise modified from time to time, the Senior Subsidiary Security
Agreement”), among the Subsidiary Guarantors (such term and
each other capitalized term used but not defined herein having the meaning
assigned to such term in the Senior Subsidiary Security Agreement, including the
Definitions Annex and Senior Credit Agreement referred to therein and, after the
Senior Loan Obligation Payment Date, the applicable Additional Senior Debt
Document) and the Senior Collateral Agent.
Pursuant
to the Senior Subsidiary Security Agreement, the Grantor has granted to the
Senior Collateral Agent, for the benefit of the Senior Secured Parties, a
perfected security interest in certain property of the Grantor, including the
Concentration Account.
The
Grantor hereby transfers to the Senior Collateral Agent exclusive ownership and
control of, and all of its right, title and interest in and to, the
Concentration Account and all funds and other property on deposit therein. By
executing this Concentration Account Agreement, the Concentration Account Bank
acknowledges that the Senior Collateral Agent now have exclusive ownership and
control of the Concentration Account, that all funds in the Concentration
Account shall be transferred to the Senior Collateral Agent as provided herein,
that the Concentration Account is being maintained by the Concentration Account
Bank for the benefit of the Senior Collateral Agent and that all amounts and
other property therein are held by the Concentration Account Bank as custodian
for the Senior Collateral Agent.
Except
as provided in paragraphs (e), (f) and (j) below, the Concentration Account
shall not be subject to deduction, setoff, banker’s lien, counterclaim, defense,
recoupment or any other right in favor of any Person or entity other than the
Senior Collateral Agent. By executing this Concentration Account Agreement, the
Concentration Account Bank also acknowledges that, as of the date hereof, the
Concentration
Account Bank has received no notice of any other pledge or assignment of the
Concentration Account and the Concentration Account Bank agrees with the Senior
Collateral Agent as follows:
(a)
Notwithstanding anything to the contrary or any other agreement relating
to the Concentration Account, the Concentration Account is and will be
maintained for the benefit of the Senior Collateral Agent, will be entitled
“Citicorp North America, Inc.,
as Senior Collateral Agent under the Senior Subsidiary Security Agreement dated
as of June 27, 2001 and amended and restated as of June 5, 2009
Account” and will be subject to
written instructions only from authorized officers of the Senior Collateral
Agent (except as expressly provided otherwise herein).
(b)
The Concentration Account Bank agrees to give the Senior Collateral Agent
prompt notice if the Concentration Account shall become subject to any writ,
judgment, warrant of attachment, execution or similar process.
(c)
[A post office box (the “Lockbox”) has been rented in the name
of the Grantor at the
[
post office and the address to be used for such Lockbox is:
[Insert
address]
The
Concentration Account Bank’s authorized representatives will have access to the
Lockbox under the authority given by the Grantor to the post office and will
make regular pick-ups from the Lockbox timed to gain maximum benefit of early
presentation and availability of funds. The Concentration Account
Bank will endorse process all checks received in the Lockbox and deposit such
checks (to the extent eligible) in the Concentration Account in accordance with
the procedures set forth below .]
(d)
The Concentration Account Bank will follow its usual operating procedures
for the handling of any [checks received from the Lockbox] or other remittance
received in the Concentration Account that contains restrictive endorsements,
irregularities (such as a variance between the written and numerical amounts),
undated or postdated items, missing signatures, incorrect payees and the
like.
(e)
The Concentration Account Bank will endorse and process all eligible
checks and other remittance items not covered by paragraph (d) and deposit such
checks and remittance items in the Concentration Account.
(f)
The Concentration Account Bank will mail all checks returned unpaid
because of uncollected or insufficient funds under appropriate advice to the
Grantor (with a copy of the notification of return to the Senior Collateral
Agent). The Concentration Account Bank may charge the Concentration Account for
the amounts of any returned check that has been previously credited to the
Concentration Account. To the extent insufficient funds remain in the
2
Concentration
Account to cover any such returned check, the Grantor shall indemnify the
Concentration Account Bank for the uncollected amount of such returned check
upon your demand.
(g)
The Concentration Account Bank will maintain a record of all checks and
other remittance items received in the Concentration Account on a daily basis
and, in addition to providing the Grantor with photostatic copies thereof,
vouchers, enclosures and the like of such checks and remittance items, furnish
to the Senior Collateral Agent a monthly statement setting forth the amounts
deposited in and withdrawn from the Concentration Account and shall furnish such
other information relating to the Concentration Account at such times as shall
be reasonably requested by the Senior Collateral Agent to: Citicorp
North America, Inc., as Senior Collateral Agent, 380 Xxxxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention:
[ ], with a copy to
the Grantor.
(h)
Prior to the delivery of a written notice from the Senior Collateral
Agent in the form of Exhibit A hereto (the “Concentration Account Cash Sweep
Notice”), the Grantor is free to withdraw funds from the Concentration
Account in such amounts and with such frequency as the Grantor may from time to
time determine, without notice to or consent from the Senior Collateral
Agent.
(i)
From and after delivery to the Concentration Account Bank of a
Concentration Account Cash Sweep Notice and until the Concentration Account Bank
is notified in writing by the Senior Collateral Agent that the Concentration
Account Cash Sweep Notice is no longer in effect (a “Concentration Account Cash Sweep
Period”), the Grantor will have no control over the use of, or any right
to withdraw any amount from, to draw upon, or to otherwise exercise any power
with respect to the Concentration Account.
(j)
During a Concentration Account Cash Sweep Period, the Concentration
Account Bank shall transfer, in same day funds, on each Business Day, all funds,
if any on deposit in, or otherwise to the credit of, the Concentration Account
to the account listed below (the “Citibank Concentration
Account”) or to such other account as the Senior Collateral Agent may
from time to time designate in writing, provided that funds on
deposit that are subject to collection may be transmitted promptly upon
collection to:
ABA Number:
[Citicorp
North America, Inc.
380
Xxxxxxxxx Xxxxxx
Xxx
Xxxx, XX 00000]
Account Name: Citibank
Concentration Account
Account Number:
Reference:
Attn:
3
(k)
All customary service charges and fees with respect to the Concentration
Account shall be debited to the Concentration Account. In the event insufficient
funds remain in the Concentration Account to cover such customary service
charges and fees, the Grantor shall pay and indemnify the Concentration Account
Bank for the amounts of such customary service charges and
fees. Neither the Senior Collateral Agent nor the Senior Secured
Parties shall have any liability for the payment of any fees or charges in
respect of the Concentration Account.
This
letter agreement shall be binding upon and shall inure to the benefit of the
Concentration Account Bank, the Grantor, the Senior Collateral Agent, the Senior
Secured Parties referred to in the Senior Subsidiary Security Agreement and
their respective successors, transferees and assigns of any of the foregoing.
This letter agreement may not be modified or terminated except upon the mutual
consent of the Senior Collateral Agent, the Grantor and the Concentration
Account Bank. The Concentration Account Bank may terminate the letter
agreement only upon 45 days’ prior written notice to the Grantor and the Senior
Collateral Agent. The Senior Collateral Agent may terminate this letter
agreement at any time. So long as any Senior Obligations remain
outstanding and the Commitments are still outstanding, upon such termination the
Concentration Account Bank shall close the Concentration Account and transfer
all funds in the Concentration Account to the Senior Collateral Agent at the
Citibank Concentration Account or as otherwise directed by the Senior Collateral
Agent. After any such termination, the Concentration Account Bank
shall nonetheless remain obligated promptly to transfer to the Concentration
Account, or as the Senior Collateral Agent may otherwise direct, all funds and
other property received in respect of the Concentration Account.
This
letter agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which when taken together shall constitute
one and the same agreement. Delivery of an executed counterpart of a signature
page to this letter agreement by telecopier shall be effective as delivery of a
manually executed counterpart of this letter agreement.
This
letter agreement supersedes all prior agreements, oral or written, with respect
to the subject matter hereof and may not be amended, modified or supplemented
except by a writing signed by the Senior Collateral Agent, the Grantor and the
Concentration Account Bank.
This
letter agreement shall be governed by, and construed in accordance with, the law
of the State of New York.
4
Upon
acceptance of this letter agreement, it will be the valid and binding obligation
of the Grantor, the Senior Collateral Agent, and the Concentration Account Bank,
in accordance with its terms.
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Very
truly yours,
[
]
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By:
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Name:
|
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Title:
|
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CITICORP
NORTH AMERICA, INC, as Senior Collateral Agent,
|
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By:
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Name:
|
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Title:
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Acknowledged
and agreed to as of
the
date first above written:
[ ]
By: __________________________
Name:
Title:
5
Exhibit
A
to
the Concentration Account Agreement
CONCENTRATION
ACCOUNT CASH SWEEP NOTICE
[Concentration
Account Bank]
[Address]
Re: Account
No. [ ] (the “Concentration Account”)
Ladies
and Gentlemen:
Reference
is made to the Concentration Account and that certain Concentration Account
Agreement dated June 27, 2001 and amended and restated as of June 5, 2009
(as amended, supplemented or otherwise modified from time to time, the “Concentration Account
Agreement”) among the Concentration Account Bank, the Grantor and the
Senior Collateral Agent.
Capitalized terms used herein and not otherwise defined herein shall have
the meanings assigned to them in the Concentration Account
Agreement.
The
Senior Collateral Agent hereby notifies you that, in accordance with certain
provisions of the Senior Subsidiary Security Agreement, from and after the date
of this notice, you are hereby directed to transfer (by wire transfer or other
method of transfer mutually acceptable to you and the Senior Collateral Agent)
to the Senior Collateral Agent, in same day funds, on each Business Day, the
entire balance in the Concentration Account to the Citibank Concentration
Account specified in paragraph (j) of the Concentration Account Agreement (or to
such other account as the Senior Collateral Agent may from time to time, or at
any time, designate in writing) until you are notified in writing by the Senior
Collateral Agent that this Concentration Account Cash Sweep Notice is no longer
effective.
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Very
truly yours,
CITICORP
NORTH AMERICA, INC, as Senior Collateral
Agent,
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By:
|
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Name:
|
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Title:
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Schedule
8
to
the Senior Subsidiary
Security
Agreement
PERFECTION
CERTIFICATE
