EXHIBIT 4.4
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CASH COLLATERAL AND SECURITY AGREEMENT dated as of February 28, 1994,
between CDW REALCO, INC., a Delaware corporation (the "Grantor"), and
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WESTINGHOUSE ELECTRIC CORPORATION, a Pennsylvania
corporation, as collateral agent (in such capacity, the "Collateral Agent") for
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the Secured Parties, as defined herein.
Reference is made to the Asset Acquisition Agreement (the "Acquisition
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Agreement") dated as of February 15, 1994, between CDW Holding Corporation
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("Buyer") and Westinghouse Electric Corporation ("Seller") pursuant to which
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(a) Seller has agreed to transfer certain assets to Buyer and Buyer has agreed
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to acquire such assets from Seller, (b)in partial consideration for such
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acquisition, Buyer has agreed to execute and deliver to Seller $77,925,440.14
Original Face Amount (as defined therein) of its first mortgage notes due 2001
(the "Buyer Notes"), (c) Seller has agreed to transfer such assets (other than
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certain real property) to CDW Acquisition Corporation ("Newco") at the direction
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of Buyer and release Buyer from its obligations under the Buyer Notes in
consideration for, among other things, the assumption by Newco of the Buyer
Notes, (d) Seller has agreed to transfer certain real property to the Grantor at
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the direction of Buyer and Newco and release Newco from its obligations under
the Buyer Notes in consideration for, among other things, (i) the assumption
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by the Grantor of the Buyer Notes, (ii) the execution and delivery by Buyer and
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Newco of the guaranties endorsed on the Buyer Notes, (iii) the execution and
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delivery by the Grantor of mortgages on such real property securing the Buyer
Notes and (iv) the execution and delivery by the Grantor of a security agreement
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in the form hereof and (e) Seller has agreed to surrender the Buyer Notes to the
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Grantor in exchange for $77,925,440.14 Original Face Amount (as defined therein)
of the Grantor's first mortgage notes due 2001 (the "Realco Notes").
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Accordingly, the Grantor and the Collateral Agent hereby agree as
follows:
ARTICLE I
DEFINITIONS
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Section 1.1 Terms Defined in the Notes. Terms used herein and not
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otherwise defined herein shall have the meanings set forth in the Notes (as
defined below).
Section 1.2 Definition of Certain Terms Used Herein. As used herein,
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the following terms shall have the following meanings:
"Applicable Law" shall mean all applicable provisions of all (i)
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constitutions, treaties, statutes, laws (including the common law), rules,
regulations, ordinances, codes or orders of any Governmental Authority and (ii)
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orders, decisions, injunctions, judgments, awards and decrees of or agreements
with any Governmental Authority.
"Cash Collateral Accounts" shall mean the Cash Consideration Account,
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the Reserve Account and the Specified Loss Account.
"Cash Consideration Account" shall mean the Cash Consideration Account
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established pursuant to Section 5.1.
A "Change Prepayment Event" shall have occurred and be continuing if
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(a) a Change of Control has occurred and (b) the Grantor has not yet discharged
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in full its obligations with respect to giving notice of such Change of Control
to the holders of the Notes and the prepayment of Notes, in part or in whole, at
the request of such holders.
"Collateral" shall mean all right, title and interest of the Grantor
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in all (i) Permitted Non-Cash Consideration that forms part of the Net Proceeds
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Allocable to Payee in respect of any Restricted Asset Sale and all related FMN
Mortgages, (ii) Cash Consideration that forms part of the Net Proceeds Allocable
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to Payee in respect of any Restricted Asset Sale, (iii) amounts (including
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Specified Loss Proceeds) required to be deposited in, and
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amounts from time to time held in, the Cash Collateral Accounts, (iv) Permitted
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Investments held for the account of any Cash Collateral Account, (v) Documents
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and (vi) Proceeds.
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"Documents" shall mean all instruments, files, records, ledger sheets
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and documents covering or relating to any of the Collateral.
"FMN Debtor" shall mean any Person who is or who may become obligated
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under, with respect to or on account of any Permitted Non-Cash Consideration
that forms part of the Collateral.
"FMN Mortgages" shall mean the mortgages that secure any Permitted
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Non-Cash Consideration.
"Governmental Approval" shall mean any consent, approval,
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authorization, waiver, permit, grant, franchise, concession, agreement, license,
exemption or order of, registration, certificate, declaration or filing with or
report or notice to any Governmental Authority.
"Governmental Authority" shall mean any nation or government, any
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state, province or other political subdivision thereof, any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government, including any government authority, agency,
department, board, commission or instrumentality of the United States, Canada,
any state of the United States, any province of Canada or any political
subdivision thereof, and any tribunal or arbitrator(s) of competent
jurisdiction, and any self-regulatory organization.
"Guaranty Agreement" shall mean the guaranty by the Grantor endorsed
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on each Canadian Note.
"Liability Reserve", with respect to any Restricted Asset Sale, shall
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mean any reserve established by
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the Grantor in accordance with GAAP pursuant to Section 5.3(a) at the time of
such Restricted Asset Sale in connection with any Permitted Liabilities in
respect of such Restricted Asset Sale.
"Loan Documents" shall mean the Notes (including the Guaranties
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endorsed thereon), the Canadian Notes (including the Guaranties endorsed
thereon) and the Mortgage Documents.
"Mortgages" shall mean the mortgages of real property executed by the
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Grantor that by their terms secure the payment by the Grantor of its obligations
under the Notes (whether or not such mortgages also secure other obligations).
"Notes" shall mean the Buyer Notes until the Buyer Notes are
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surrendered by Seller to the Grantor in exchange for the Realco Notes, and
thereafter shall mean the Realco Notes.
"Obligations" shall mean (i) the due and punctual payment by the
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Grantor of (A) the Accreted Value of the Notes, when and as due, whether at
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maturity, by acceleration, upon one or more dates set for prepayment or
otherwise, (B) all monetary obligations of the Grantor under the Guaranty
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Agreement and (C) all other monetary obligations of the Grantor under the Loan
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Documents and (ii) the due and punctual performance of all other obligations of
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the Grantor under the Loan Documents.
"Permitted Encumbrances", with respect to any Replacement Property (as
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defined below), shall mean the "Permitted Encumbrances", as defined in the
Mortgage relating to such Replacement Property.
"Permitted Investments" shall mean:
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(a) marketable direct obligations issued or unconditionally
guaranteed by the United States of
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America or issued by any agency thereof and backed by the full faith and
credit of the United States of America, in each case maturing within one
year from the date of acquisition thereof;
(b) marketable general obligations issued by any state of the United
States of America or any political subdivision of any such state or any
public instrumentality thereof maturing within six months from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings generally obtainable from either Standard & Poor's
Corporation or Xxxxx'x Investors Service, Inc.; or
(c) commercial paper maturing no more than six months from the date
of creation thereof and, at the time of acquisition, having a rating of A-2
or higher from Standard & Poor's Corporation or P-2 or higher from Xxxxx'x
Investors Service, Inc.;
(d) domestic certificates of deposit, time or demand deposits or
bankers' acceptances maturing within six months after the date of
acquisition issued by any commercial bank organized under the laws of the
United States of America or any state thereof or the District of Columbia
having combined capital, surplus and undivided profits (less any undivided
losses) of not less than $250,000,000; and
(e) fully collateralized repurchase agreements with a term of not
more than 30 days for underlying securities of the type described in clause
(a) or (b) above entered into with any institution meeting the
qualifications specified in clause (d) above;
provided, however, that any Permitted Investment must have a stated maturity
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prior to Stated Maturity.
"Permitted Liens" shall mean any (i) Liens for taxes that are not yet
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due and payable or that may after
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contest be paid without penalty or that are being contested in good faith by the
Grantor and (ii) Liens arising by reason of any judgment, decree or order of
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any Governmental Authority that does not arise out of any breach by the Grantor
of any of the Loan Documents if (A) appropriate legal proceedings have been duly
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initiated for the review of such judgment, decree or order, are being diligently
prosecuted and have not been finally terminated or (B) the period within which
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such proceedings may be initiated has not expired.
"Proceeds" shall mean any consideration received from the sale,
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exchange, license, lease or other disposition of any asset or property which
constitutes Collateral, any payments received on Permitted Non-Cash
Consideration that forms part of the Collateral, any payments or other assets
received as a consequence of the possession of any Collateral and any payment
received from any insurer or other person or entity as a result of the
destruction, loss, theft, damage or other involuntary conversion of whatever
nature of any asset or property which constitutes Collateral (but only to the
extent such payment relates to any such asset or property), and shall include
all cash and negotiable instruments received or held on behalf of the Collateral
Agent pursuant to Article V.
"Replacement Property" is defined in Section 5.1(d).
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"Reserve Account" shall mean the Reserve Account established pursuant
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to Section 5.3.
"Secured Parties" shall mean (i) each holder of Notes, (ii) each
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holder of Canadian Notes, (iii) the Collateral Agent in its capacity as such,
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(iv) the beneficiaries of each indemnification obligation undertaken by the
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Grantor under any Mortgage Document and (v) the successors of the foregoing.
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"Specified Loss Account" shall mean the Specified Loss Account
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established pursuant to Section 5.4.
"Specified Loss Proceeds" shall mean any amounts paid to the
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Collateral Agent pursuant to Section 4.3 or 4.4 of any Mortgage.
ARTICLE II
SECURITY INTEREST
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Section 2.1 Security Interest. As security for the payment or
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performance, as the case may be, of the Obligations, the Grantor hereby
bargains, sells, conveys, assigns, sets over, mortgages, pledges, hypothecates
and transfers to the Collateral Agent and its successors, for the benefit of the
Secured Parties, and hereby grants to the Collateral Agent and its successors,
for the benefit of the Secured Parties, a security interest in, all the
Grantor's right, title and interest in, to and under the Collateral (the
"Security Interest"). Without limiting the foregoing, the Collateral Agent is
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hereby authorized to file one or more financing statements, continuation
statements or other documents for the purpose of perfecting, confirming,
continuing, enforcing or protecting the Security Interest granted by the
Grantor, without the signature of the Grantor to the extent permitted by
Applicable Law, naming the Grantor as debtor and the Collateral Agent as secured
party.
Section 2.2 No Assumption of Liability. The Security Interest is
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granted as security only and shall not subject the Collateral Agent or any
Secured Party to, or in any way alter or modify, any obligation or liability of
the Grantor with respect to or arising out of any of the Collateral.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
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As of the date hereof and as of the date any Cash Consideration or
Permitted Non-Cash Consideration is delivered to the Collateral Agent to be held
pursuant to this Agreement, the Grantor represents and warrants to the
Collateral Agent and the Secured Parties that:
Section 3.1 Title and Authority. The Grantor has (or, in the case of
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after-acquired Collateral, on the date of its delivery to the Collateral Agent,
will have) good and valid rights in and title to the Collateral with respect to
which it has purported to grant a Security Interest hereunder and has (or, in
the case of after-acquired Collateral, on the date of its delivery to the
Collateral Agent, will have) full power and authority to grant to the Collateral
Agent the Security Interest in such Collateral pursuant hereto and has full
power and authority to execute, deliver and perform its obligations in
accordance with the terms of this Agreement, without the consent or approval of
any other Person, other than any consent or approval which has been obtained.
Section 3.2 Filings. The Grantor has (or promptly after the Closing
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Date, but in no event later than the date Collateral is first delivered to the
Collateral Agent, will have) made all the filings, recordings and registrations
listed on Schedule 3.2A, which are the only filings, recordings and
registrations necessary to protect the validity of and to establish a legal,
valid and perfected security interest in favor of the Collateral Agent (for the
benefit of the Secured Parties) in respect of all such Collateral in which the
Security Interest may be perfected by filing, recording or registration with
respect to such Collateral under the Uniform Commercial Code (the "UCC") as in
effect in the United States (or any political subdivision thereof), and no
further or subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary with respect to such Collateral under
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the UCC as in effect in any such jurisdiction, except as provided under
Applicable Law with respect to the filing of continuation statements and except
that additional filings may be necessary if the Grantor thereafter changes its
name, identity or corporate structure or the location of its places of business,
its chief executive office or the Collateral. Without limiting the generality of
the foregoing, simultaneously, with delivery of any Permitted Non-Cash
Consideration to the Collateral Agent or as soon thereafter as practicable, the
Grantor shall have taken all such actions and made all such filings, recordings
and registrations that are necessary in order to enable the Collateral Agent to
enforce directly against the applicable FMN Debtor its obligations in respect of
such Permitted Non Cash Consideration and to exercise remedies under the
applicable FMN Mortgage, without the necessity of any further consent or
approval of the Grantor.
Section 3.3 Validity of Security Interest. The Security Interest
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constitutes (or, in the case of after-acquired Collateral, will on the date of
delivery of such after-acquired Collateral to the Collateral Agent constitute)
(a) a legal and valid security interest in all the Collateral securing the
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payment and performance of the Obligations and (b) a perfected security interest
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in all Collateral in which a security interest may be perfected by either (i)
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possession of the Collateral by the Collateral Agent (assuming continuing
possession by the Collateral Agent) or (ii) filing, recording or registering a
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financing statement or analogous document under the UCC as in effect in the
United States (or any political subdivision thereof). To the extent priority is
governed by the UCC, the Security Interest is and shall be prior to any other
Lien on any of the Collateral, including any Permitted Lien.
Section 3.4 Absence of Other Liens. Collateral is owned by the
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Grantor free and clear of any Lien (other than the Security Interest and any
Permitted Lien). Other than as contemplated hereby, the Grantor has not filed
or consented to the filing of (a) any financing statement or
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analogous document under the UCC or any other Applicable Law covering any
Collateral or (b) any assignment in which the Grantor assigns any Collateral or
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any security agreement or similar instrument covering any Collateral with any
Governmental Authority.
Section 3.5 Location of Chief Executive Office. The principal place
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of business and chief executive office of the Grantor, and the office where the
Grantor keeps the Documents and any other books and records concerning the
Collateral, are located at the address specified for the Grantor in Section 8.8.
The exact corporate name of the Grantor as it appears in its certificate of
incorporation, each other corporate name the Grantor has had, and all other
names (including trade names or similar appellations) under which the Grantor or
any of its divisions, subsidiaries or other business units has carried on
business are as listed in the caption to this Agreement or notified to the
Collateral Agent pursuant to Section 4.1.
ARTICLE IV
COVENANTS
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Section 4.1 Change of Name; Location of Collateral; Place of
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Business. The Grantor will promptly notify the Collateral Agent of any change
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(i) in its corporate name or in any trade name used to identify it in the
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conduct of its business or in the ownership of its properties, (ii) in the
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location of its chief executive office, its principal place of business or any
office in which it maintains books or records relating to Collateral or (iii) in
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its identity or corporate structure. The Grantor will not effect or permit any
change referred to in the preceding sentence unless all filings, recordings or
registrations have been made under the UCC or otherwise which are required in
order for the Collateral Agent to continue at all times following such change to
have a legal, valid and perfected security interest in all the Collateral in
which a security interest may be perfected under the UCC
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by filing, recording or registering a financing statement or similar document.
Section 4.2 Periodic Certification. Each year, at the time of
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delivery of Newco's annual financial statements with respect to the preceding
fiscal year pursuant to the Notes, the Grantor will deliver to the Collateral
Agent a certificate executed by a financial officer and the chief legal officer
of the Grantor (a) certifying that all appropriate UCC financing statements
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(including fixture filings, as applicable) or other appropriate filings,
recordings or registrations, including all refilings, rerecordings and
reregistrations, containing a description of the Collateral have been filed of
record in each Governmental Authority to the extent necessary under the UCC to
perfect the Security Interest for a period of not less than six months after the
date of such certificate, (b) setting forth all filings, recordings and
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registrations, including all refilings, rerecordings and reregistrations, that,
with respect to the Collateral as of the date of such certificate, would be
required under the UCC to be made within 18 months after the date of such
certificate to perfect the Security Interest in such Collateral for a period of
not less than two years after the date of such certificate, (c) setting forth,
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with respect to each filing, recording or registration (including each refiling,
rerecording or reregistration) made since the date of the most recent
certificate delivered pursuant to this Section, the filing office, date and file
number thereof and (d) attaching true, correct and complete acknowledgement
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copies of each such filing, recording or registration not theretofore delivered
to the Collateral Agent.
Section 4.3 Protection of Security. The Grantor will, at its own
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cost and expense, take any and all actions necessary to (i) defend title to the
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Collateral against all persons and to defend the Security Interest of the
Collateral Agent in the Collateral and the priority thereof against any Lien
(other than any Permitted Lien) and
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(ii) resist enforcement of any Permitted Lien against any Collateral.
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Section 4.4 Further Assurances. (a) The Grantor will, at its own
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cost and expense, execute, acknowledge, deliver and cause to be duly filed all
such further instruments and documents and take all such actions as the
Collateral Agent may from time to time reasonably request to better assure,
preserve, protect and perfect the Security Interest and the rights and remedies
created hereby, including the payment of any fees and filing, registration,
stamp and other similar taxes required in connection with the execution and
delivery of this Agreement, the granting of the Security Interest and the filing
of any financing statements (including fixture filings) or other documents in
connection herewith.
(b) Without limiting the generality of the foregoing, any Permitted
Non-Cash Consideration delivered to the Collateral Agent (and the related FMN
Mortgage) shall, unless otherwise requested by the Collateral Agent, be
registered in the name of the Collateral Agent or its nominee. If the
Collateral Agent requests that any such Permitted Non-Cash Consideration and the
related FMN Mortgage not be registered in the name of the Collateral Agent or
its nominee, such Permitted Non-Cash Consideration and related FMN Mortgage (i)
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shall be duly endorsed in a manner, or accompanied by instruments of transfer or
assignment in a form reasonably satisfactory to the Collateral Agent, (ii) shall
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provide that (A) the rights of the Grantor under such Permitted Non-Cash
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Consideration and related FMN Mortgage may be assigned without the consent of
the applicable FMN Debtor, (B) any assignee of the Grantor can exercise all of
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the rights of the Grantor under such Permitted Non-Cash Consideration and
related FMN Mortgage, (C) the applicable FMN Debtor will make all payments under
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such Permitted Non-Cash Consideration as directed by the Grantor, and (D) the
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terms of such Permitted Non-Cash Consideration and related FMN Mortgage shall
not be amended or modified, and the Grantor will not agree to a waiver or
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compromise thereof, without the consent of the Grantor and any assignee of the
Grantor and (iii) shall be accompanied by an instrument duly executed by the
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applicable FMN Debtor, in a form reasonably satisfactory to the Collateral
Agent, pursuant to which such FMN Debtor shall acknowledge the assignment to the
Collateral Agent of all the rights of the Grantor in respect of such Permitted
Non-Cash Consideration and related FMN Mortgage (it being agreed that, as
between the Grantor and the Collateral Agent, the exercise of rights and powers
accruing to the owner of any Permitted Non-Cash Consideration shall be governed
by this Agreement).
(c) The Collateral Agent shall have the right (in its sole and
absolute discretion) to hold any Permitted Non-Cash Consideration forming part
of the Collateral in its own name as pledgee, the name of its nominee or the
name of the Grantor. The Grantor will promptly give to the Collateral Agent
copies of any notices or other communications received by it with respect to any
Permitted Non-Cash Consideration forming part of the Collateral registered in
the name of the Grantor.
(d) The Collateral Agent shall, upon the reasonable request of the
Grantor, sign any financing statement or other similar document, in form and
substance reasonably satisfactory to the Collateral Agent, required to be filed
by the Grantor pursuant to this Agreement and that requires the signature of the
Collateral Agent.
Section 4.5 Rights and Obligations Under Permitted Non-Cash
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Consideration. (a) Unless and until an Event of Default shall have occurred
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and be continuing and the Collateral Agent shall have notified the Grantor that
the Grantor's rights under this Section are being suspended:
(i) The Grantor shall be entitled to exercise any and all the rights
and powers of the owner of any Permitted Non-Cash Consideration forming
part of the Collateral (and the related FMN Mortgage) to amend, waive or
modify the terms thereof and to grant consents
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or approvals thereunder; provided, however, that (A) such exercise could
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not reasonably be expected to materially and adversely affect the rights
inuring to a holder of such Permitted Non-Cash Consideration or the rights
and remedies of the Collateral Agent or any of the Secured Parties under
any of the Loan Documents or any of the Secured Parties to exercise the
same and (B) the Grantor may not amend, waive, modify or compromise any
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such Permitted Non-Cash Consideration (or the related FMN Mortgage) to (w)
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extend the maturity or decrease the principal amount of, or reduce the rate
of interest or extend the time of payment of any installment of principal
of or interest on, any such Permitted Non-Cash Consideration, (x) release
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or subordinate the Lien of any FMN Mortgage forming part of the Collateral
or adversely affect the ability to exercise remedies thereunder, (y) permit
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any FMN Mortgage forming part of the Collateral to secure any obligation
other than an obligation to the Grantor or an obligation under Permitted
Non-Cash Consideration forming part of the Collateral or (z) restrict the
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assignability thereof.
(ii) The Grantor shall be entitled to (and hereby agrees for the
benefit of the Secured Parties that it will exercise commercially
reasonable efforts to) enforce, in a commercially reasonable manner, the
rights and remedies accruing to the owner of any Permitted Non-Cash
Consideration forming part of the Collateral (and the related FMN
Mortgage), including enforcement of the payment when due of amounts payable
thereunder; provided, however, that the foregoing shall not be construed to
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constitute a guarantee by the Grantor of collection or otherwise.
(iii) The Collateral Agent will execute and deliver to the Grantor, or
cause to be executed and delivered to the Grantor, all such proxies, powers
of attorney and other instruments as the Grantor may reasonably request for
the purpose of enabling the Grantor to
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exercise the rights and powers which it is entitled (or obligated) to
exercise pursuant to Section 4.5(a)(i) or 4.5(a)(ii).
(b) Upon the occurrence and during the continuance of an Event of
Default, after the Collateral Agent shall have notified the Grantor of the
suspension of its rights under Section 4.5(a), then all rights and obligations
of the Grantor to exercise the rights and powers which it is entitled to
exercise pursuant to Section 4.5(a), and the obligations of the Collateral Agent
under Section 4.5(a), shall cease, and all such rights shall thereupon become
vested in the Collateral Agent, which shall have the sole and exclusive right
and authority to exercise such rights and powers.
(c) Any notice given by the Collateral Agent to the Grantor
suspending its rights under Section 4.5(a)(i) may be given by telephone if
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promptly confirmed in writing and (ii) may suspend the rights of the Grantor
--
under Section 4.5(a) in part without suspending all such rights (as specified by
the Collateral Agent in its sole and absolute discretion) and without waiving or
otherwise affecting the Collateral Agent's rights to give additional notices
from time to time suspending other rights so long as an Event of Default has
occurred and is continuing.
Section 4.6 Inspection and Verification. The Collateral Agent and
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such persons as the Collateral Agent may reasonably designate shall have the
right, at any reasonable time or times, to inspect all records related to the
Collateral (and to make extracts and copies from such records) and to verify
under reasonable procedures the validity, amount, quality, quantity, value,
condition and status of, or any other matter relating to the Collateral,
including by contacting FMN Debtors. The Collateral Agent shall have the
absolute right to share any information it gains from such inspection or
verification with any Secured Party. Without the prior written consent of the
Grantor, the Collateral Agent shall not disclose, and shall require
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as a condition to sharing such information with any Secured Party or other
Person that such Secured Party or other Person agree not to disclose, to any
Person that is not a Secured Party any such information which is designated by
the Grantor to the Collateral Agent in writing as confidential; provided,
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however, that the Collateral Agent or any Secured Party may disclose such
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information (a) to any of their respective accountants, counsel, consultants,
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employees or agents who are advised of the confidential nature of such
information, (b) if it becomes publicly available other than by reason of a
-
breach of this sentence, (c) if received from a third party not bound by any
-
confidentiality agreement with Buyer, Newco, the Grantor or the Canadian Buyer,
(d) required by Applicable Law or any Governmental Approval to be disclosed by
-
such Person, (e) necessary to establish such Person's rights under any of the
-
Loan Documents or (f) to any prospective permitted assignee of all or a portion
-
of the rights of such Person under the Loan Documents if such prospective
permitted assignee agrees to be bound by the confidentiality provisions
contained in this sentence.
Section 4.7 Taxes; Encumbrances. At its option, the Collateral Agent
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may discharge past-due taxes, assessments, charges, fees, liens, security
interests or other encumbrances at any time levied or placed on the Collateral
(other than any Permitted Lien), and may pay for the maintenance and
preservation of the Collateral to the extent the Grantor fails to do so, and the
Grantor agrees to reimburse the Collateral Agent on demand for any payment made
or any expense incurred by the Collateral Agent pursuant to the foregoing
authorization; provided, however, that nothing in this Section shall be
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interpreted as excusing the Grantor from the performance of, or imposing any
obligation on the Collateral Agent or any Secured Party to cure or perform, any
covenants or other promises of the Grantor with respect to taxes, assessments,
charges, fees, liens, security interests or other encumbrances and maintenance.
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Section 4.8 Continuing Obligations of the Grantor. The Grantor shall
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remain liable to observe and perform all the conditions and obligations to be
observed and performed by it under each contract, agreement or instrument
relating to the Collateral unless and until title to such contract, agreement or
instrument has been indefeasibly vested in the Collateral Agent pursuant to the
exercise of its remedies under Article VI, all in accordance with the terms and
conditions thereof, and the Grantor will indemnify and hold harmless the
Collateral Agent and the Secured Parties from and against any and all liability
arising out of the Grantor's performance or failure to perform the same.
Section 4.9 Use and Disposition of Collateral. Except for the
---------------------------------
Security Interest, the Grantor will not (i) make or permit to be made an
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assignment, pledge or hypothecation of the Collateral or (ii) grant any other
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Lien in respect of the Collateral. The Grantor will not make or permit to be
made any transfer of the Collateral other than withdrawals from the Cash
Collateral Accounts made in accordance with Article V.
Section 4.10 Register. The Collateral Agent and such persons as the
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Collateral Agent may reasonably designate shall have the right, at any
reasonable time or times, to inspect the Register (and to make extracts from and
copies of the Register). At the request of the Collateral Agent, the Grantor
shall use reasonable efforts to provide to the Collateral Agent a copy of the
"Register" (as defined in the Canadian Notes).
ARTICLE V
CASH COLLATERAL ACCOUNTS
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Section 5.1 Cash Consideration Account. (a) Prior to the first
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delivery to the Collateral Agent of any Cash Consideration or Permitted Non-Cash
Consideration constituting Net Proceeds Allocable to Payee, the Collateral
17
Agent will establish with a financial institution reasonably satisfactory to the
Grantor (it being agreed that such financial institution shall not be a creditor
of the Grantor or any of its Affiliates) an account (the "Cash Consideration
------------------
Account") over which the Collateral Agent shall have exclusive dominion and
-------
control, including the exclusive right of withdrawal.
(b) Any Proceeds from the investment pursuant to Section 5.5 of
amounts of Net Proceeds Allocable to Payee in respect of any Restricted Asset
Sale, net of the amount so invested, shall, solely for the purposes of this
Section, constitute additional Net Proceeds in respect of such Restricted Asset
Sale.
(c) The Collateral Agent will, upon written request from the Grantor,
withdraw cash from the Cash Consideration Account and apply such cash to prepay,
in whole or in part, the Notes in accordance with the instructions of the
Grantor set forth in such written request; provided, however, that (i) such
-------- ------- -
instructions are consistent with paragraph 7(c) of the Notes, (ii) such written
--
request specifies each Restricted Asset Sale the Net Proceeds Allocable to Payee
in respect of which are to be so applied and, if more than one Restricted Asset
Sale is so specified, the amount of the Net Proceeds Allocable to Payee in
respect of each Restricted Asset Sale to be so applied, (iii) the amount of any
---
Net Proceeds Allocable to Payee in respect of any Restricted Asset Sale to be so
applied does not exceed the remaining balance of such Net Proceeds Allocable to
Payee in respect of such Restricted Asset Sale and (iv) cash withdrawn from the
--
Cash Consideration Account pursuant to this Section 5.1(c) shall be applied to
the prepayment of the Notes only at the direction of the Grantor.
(d) Unless an Event of Default has occurred and is continuing, the
Collateral Agent will withdraw cash from the Cash Consideration Account and pay
such cash at the direction of the Grantor on the date specified by the
18
Grantor if the following conditions shall have been satisfied:
(1) The Grantor shall have requested in writing that the Collateral
Agent effect such withdrawal not less than 10 Business Days prior to the
date on which such cash is to be withdrawn. Such request shall have
specified the amount of cash to be withdrawn and shall have been
accompanied by (A) a certificate, signed by the chief financial officer of
-
Newco, to the effect that (x) no Event of Default has occurred and is
-
continuing and (y) the proceeds of such withdrawal are to be used to
-
finance the purchase by the Grantor of a fee simple interest in real
property located in the United States (the "Replacement Property") from a
--------------------
Person who is not an Affiliate of the Grantor and (B) a copy of a contract
-
for the purchase of the Replacement Property.
(2) On or prior to the date on which such cash is to be withdrawn,
the Collateral Agent shall have received (A) a first mortgage securing the
-
Obligations, in recordable form and otherwise substantially in the form of
the Mortgages, of the Replacement Property, duly executed and delivered by
the Grantor, (B) a title insurance policy, issued by a nationally
-
recognized title insurance company reasonably satisfactory to the
Collateral Agent, insuring the lien of Collateral Agent's mortgage on the
Replacement Property, subject only to standard exceptions and Permitted
Encumbrances, in an amount not less than the amount of the proposed
withdrawal, and (C) such surveys, environmental audits and documents
-
relating to the Permitted Encumbrances and compliance with Applicable Law
and applicable Governmental Approvals, as reasonably requested by the
Collateral Agent, as shall be reasonably necessary to satisfy the
Collateral Agent that the mortgaging of the Replacement Property to secure
the Obligations and the proposed withdrawal, taken together, would not
materially and adversely affect the aggregate value of
19
the Mortgaged Property and the Collateral or the rights and remedies of the
Collateral Agent or any of the Secured Parties under the Loan Documents or
the ability of the Collateral Agent or any of the Secured Parties to
exercise the same.
(3) On the date on which such cash is to be withdrawn, the
Collateral Agent shall have received a certificate bringing down to date
the certificate referred to in Section 5.1(d)(1)(A).
(4) If the Replacement Property is being purchased in connection
with the purchase by the Grantor, or any of its Affiliates, of any assets
or services from the seller of the Replacement Property or any of its
Affiliates, the Collateral Agent shall be reasonably satisfied that the
amount of cash proposed to be withdrawn shall not be greater than the fair
market value of the Replacement Property. If the Replacement Property is
not being purchased in connection with the purchase by the Grantor, or any
of its Affiliates, of any assets or services from the seller of the
Replacement Property or any of its Affiliates, the Collateral Agent shall
be reasonably satisfied that the amount of cash proposed to be withdrawn
shall not be greater than the cash purchase price for the Replacement
Property.
(5) The Grantor directs that the cash withdrawn is to be paid to, or
at the direction of, the seller of the Replacement Property.
(6) The amount of cash to be withdrawn does not exceed (A) the amount
-
of Cash Consideration received by the Collateral Agent during the preceding
18 months (including in such amount any portion of Excess Reserved Amounts
transferred to the Cash Consideration Account from the Reserve Account
pursuant to Section 5.3(e) in respect of a Liability Reserve established
within the preceding 18 months) and not previously withdrawn from the Cash
Consideration Account plus
20
(B) the amount of cash Proceeds received by the Collateral Agent
during the preceding 18 months in respect of Permitted Non-Cash
Consideration and not previously withdrawn from the Cash Consideration
Account plus (C) the amount of any Proceeds from the investment pursuant to
-
Section 5.5 of cash described in clause (A) or (B) above to the extent not
previously withdrawn from the Cash Consideration Account.
(e) At least 10 days prior to each Semi-Annual Accrual Date that
occurs at least 18 months after the receipt by the Collateral Agent of any Net
Proceeds Allocable to Payee, the Grantor shall direct the Collateral Agent in
writing (1) to retain in the Cash Consideration Account all Net Proceeds
-
Allocable to Payee deposited therein less than 18 months (including in such
amount any amounts transferred to the Cash Consideration Account from the
Reserve Account pursuant to Section 5.3(e) in respect of a Liability Reserve
established within the preceding 18 months) prior to such Semi-Annual Accrual
Date (and all Proceeds therefrom or from the investment thereof in accordance
with Sections 5.1(b) and 5.5) and (2) to apply any balance of the amount in the
-
Cash Collateral Account, after such retention and after any application pursuant
to Section 5.1(d), to prepayment of the Notes on such Semi-annual Accrual Date.
Upon such written direction of the Grantor the Collateral Agent shall withdraw
cash in an amount equal to such balance, if any, from the Cash Consideration
Account and apply such cash to prepay, in whole or in part, the Notes in
accordance with the instructions of the Grantor set forth in such written
direction; provided, however, that (i) such instructions are consistent with
-------- ------- -
paragraph 7(c) of the Notes and (ii) any cash withdrawn from the Cash
--
Consideration Account pursuant to this Section 5.1(e) shall be applied to the
prepayment of the Notes only at the direction of the Grantor.
(f) If an Event of Default has occurred and is continuing, the
Collateral Agent may, in its sole discretion, apply all amounts on deposit in
the Cash Consideration
21
Account to satisfy in accordance with Section 6.2 any Obligations then due and
payable.
Section 5.2 Deposits. (a) The Grantor will notify and direct
--------
promptly each FMN Debtor and every other Person obligated to make payments on or
with respect to Permitted Non-Cash Consideration forming part of the Collateral
to make all such payments to the Cash Consideration Account. The Grantor shall
use all reasonable efforts to cause each FMN Debtor and every other Person
identified in the preceding sentence to make all payments on or with respect to
Permitted Non-Cash Consideration forming part of the Collateral directly to the
Cash Consideration Account.
(b) In the event that the Grantor directly receives any Proceeds on
or with respect to Permitted Non-Cash Consideration forming part of the
Collateral (including Proceeds from any exercise of remedies in respect thereof,
under any FMN Mortgage or otherwise), notwithstanding the arrangements for
payment directly into the Cash Consideration Account, such Proceeds shall be
held in trust for the benefit of the Collateral Agent and the Secured Parties
and shall be segregated from other funds of the Grantor, subject to the Security
Interest granted hereby, and the Grantor shall cause such Proceeds to be
deposited into the Cash Consideration Account as soon as practicable after the
Grantor's receipt thereof.
(c) All Cash Consideration constituting Net Proceeds Allocable to
Payee received by the Grantor or the Collateral Agent shall forthwith be
deposited into the Cash Consideration Account, subject to (i) the rights of the
-
Collateral Agent to apply Cash Consideration in accordance with Section 6.2 if
an Event of Default has occurred and is continuing and (ii) the rights of the
--
Grantor to direct the Collateral Agent to withdraw amounts on deposit in the
Cash Consideration Account.
22
Section 5.3 Reserve Account. (a) In connection with any Restricted
---------------
Asset Sale, the Grantor may establish a Liability Reserve (not in excess of the
reserve in respect thereof required by GAAP) by:
(i) not less than five Business Days prior to the consummation of
such Restricted Asset Sale, giving the Collateral Agent written notice that
the Grantor intends to establish a Liability Reserve with respect to such
Restricted Asset Sale;
(ii) simultaneously with the consummation of such Restricted Asset
Sale, delivering to the Collateral Agent a certificate, signed by the chief
accounting officer of Newco, stating (A) that the Grantor is establishing a
-
reserve with respect to Permitted Liabilities in respect of such Restricted
Asset Sale and stating the initial balance of the related Reserved Amount,
(B) that the Grantor is required by GAAP to establish such a reserve in an
-
amount not less than such stated initial balance and (C) whether or not the
-
Grantor is obligated by paragraph 6(c)(6)(b) of the Notes to deliver cash
equal to such Reserved Amount for deposit hereunder; and
(iii) simultaneously with the consummation of such Restricted Asset
Sale, if obligated to do so by paragraph 6(c)(6)(b) of the Notes,
delivering to the Collateral Agent an amount of cash equal to the initial
balance of the Reserved Amount (such amount to be in addition to any Cash
Consideration paid to the Collateral Agent in connection with such
Restricted Asset Sale to be deposited in the Cash Consideration Account).
(b) Prior to the first delivery to the Collateral Agent of any cash
pursuant to Section 5.3(a)(iii), the Collateral Agent will establish with a
financial institution reasonably satisfactory to the Grantor (it being agreed
that such financial institution shall not be a creditor of the
23
Grantor or any of its Affiliates) an account (the "Reserve Account") over which
---------------
the Collateral Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal. All amounts received by the Collateral Agent
pursuant to Section 5.3(a)(iii) and all cash Proceeds from investments thereof
pursuant to Section 5.5 shall forthwith be deposited into the Reserve Account.
(c) The Reserved Amount in respect of any Restricted Asset Sale shall
be increased by the amount of any Proceeds from the investment of such Reserved
Amount pursuant to Section 5.5, net of the amount so invested, and reduced by
any withdrawals pursuant to this Section in respect of such Reserved Amount.
(d) The Collateral Agent will, upon written request from the Grantor,
withdraw cash from the Reserve Account and apply such cash to prepay, in whole
or in part, the Notes in accordance with the instructions of the Grantor set
forth in such written request; provided, however, that (i) such instructions are
-------- ------- -
consistent with paragraph 7(c) of the Notes, (ii) such written request specifies
--
each Restricted Asset Sale the Reserved Amount in respect of which is to be
reduced in connection with such withdrawal and, if more than one Restricted
Asset Sale is so specified, the amount by which each related Reserved Amount is
to be reduced, (iii) the amount by which any Reserved Amount is to be reduced
---
does not exceed the remaining balance of such Reserved Amount and (iv) any cash
--
withdrawn from the Reserve Account pursuant to this Section 5.3(d) shall be
applied to the prepayment of the Notes only at the direction of the Grantor.
(e) Unless an Event of Default has occurred and is continuing, the
Collateral Agent will, upon written request from the Grantor, transfer all or a
portion of any Excess Reserved Amount from the Reserve Account to the Cash
Consideration Account if the following conditions shall have been satisfied:
24
(1) Such request shall specify each Restricted Asset Sale with
respect to which such Excess Reserved Amount has arisen and, if more than
one Restricted Asset Sale is so specified, the amount of each related
Excess Reserved Amount.
(2) The amount of each Excess Reserved Amount does not exceed the
remaining balance of the related Reserved Amount.
(3) Such request shall be accompanied by a certificate, signed by the
chief accounting officer of Newco, to the effect that the Grantor is no
longer required by GAAP to maintain the related Excess Reserved Amount in
its reserve in respect of each such Restricted Asset Sale.
(4) The amount of each such Excess Reserved Amount to be transferred
constitutes Net Proceeds Allocable to Payee.
(f) Unless an Event of Default or a Change Prepayment Event has
occurred and is continuing, the Collateral Agent will withdraw cash from the
Reserve Account and pay such cash at the direction of the Grantor on the date
specified by the Grantor if the following conditions shall have been satisfied:
(1) The Grantor shall have requested in writing that the Collateral
Agent effect such withdrawal not less than five Business Days prior to the
date on which such cash is to be withdrawn. Such request shall have been
accompanied by a certificate, signed by the chief financial officer of
Newco, to the effect that (A) no Event of Default or Change Prepayment
-
Event has occurred and is continuing and (B) the proceeds of such
-
withdrawal are to be used to discharge a Permitted Liability which is then
due and payable (and describing such Permitted Liability in general terms,
including
25
the Restricted Asset Sale out of which such Permitted Liability has
arisen).
(2) On the date on which such cash is to be withdrawn, the Collateral
Agent shall have received a certificate bringing down to date the
certificate referred to in Section 5.3(f)(1).
(3) The amount of cash to be withdrawn does not exceed the remaining
balance of the Reserved Amount in respect of such Restricted Asset Sale.
(g) Unless an Event of Default has occurred and is continuing, the
Collateral Agent will withdraw cash from the Reserve Account and pay such cash
at the direction of the Grantor on the date specified by the Grantor if the
following conditions shall have been satisfied:
(1) The Grantor shall have requested in writing that the Collateral
Agent effect such withdrawal not less than five Business Days prior to the
date on which such cash is to be withdrawn. Such request shall have been
accompanied by a certificate, signed by the chief financial officer of
Newco, to the effect that (A) no Event of Default has occurred and is
-
continuing and (B) the proceeds of such withdrawal are to be used to
-
discharge a Permitted Liability which is then due and payable (and
describing such Permitted Liability in general terms, including the
Restricted Asset Sale out of which such Permitted Liability has arisen).
(2) On the date on which such cash is to be withdrawn, the Collateral
Agent shall have received a certificate bringing down to date the
certificate referred to in Section 5.3(g)(1).
(3) The amount of cash to be withdrawn does not exceed the remaining
balance of the Reserved Amount in respect of such Restricted Asset Sale.
26
(4) Such Restricted Asset Sale was a Mixed Asset Sale, and the
Shortfall Amount in respect of such Restricted Asset Sale is zero.
(h) Unless an Event of Default has occurred and is continuing, the
Collateral Agent will withdraw cash from the Reserve Account representing all or
a portion of any Excess Reserved Amount and pay such cash to or at the direction
of the Grantor on the date specified by the Grantor if the following conditions
shall have been satisfied:
(1) The Grantor shall have requested in writing that the Collateral
Agent effect such withdrawal not less than five Business Days prior to the
date on which such cash is to be withdrawn. Such request shall have
specified each Restricted Asset Sale with respect to which such Excess
Reserved Amount arises, and, if more than one Restricted Asset Sale is so
specified, the amount of each related Excess Reserved Amount. Such request
shall have been accompanied by (A) a certificate, signed by the chief
-
financial officer of Newco, to the effect that no Event of Default has
occurred and is continuing and (B) a certificate, signed by the chief
-
accounting officer of Newco, to the effect that the Grantor is no longer
required by GAAP to maintain the related Excess Reserved Amount in its
reserve in respect of each such Restricted Asset Sale.
(2) On the date on which such cash is to be withdrawn, the Collateral
Agent shall have received certificates bringing down to date the
certificates referred to in Section 5.3(h)(1).
(3) The amount of each such Excess Reserved Amount to be withdrawn
does not exceed the then remaining balance of the related Reserved Amount.
27
(4) Each such Restricted Asset Sale was a Mixed Asset Sale, and the
Shortfall Amount in respect of each such Restricted Asset Sale is zero.
(i) If an Event of Default has occurred and is continuing, the
Collateral Agent may, in its sole discretion, apply all amounts on deposit in
the Reserve Account to satisfy in accordance with Section 6.2 any Obligations
then due and payable.
Section 5.4 Specified Loss Account. (a) Prior to the first delivery
----------------------
to the Collateral Agent of any Specified Loss Proceeds, the Collateral Agent
will establish with a financial institution reasonably satisfactory to the
Grantor (it being agreed that such financial institution shall not be a creditor
of the Grantor or any of its Affiliates) an account (the "Specified Loss
--------------
Account") over which the Collateral Agent shall have exclusive dominion and
-------
control, including the exclusive right of withdrawal. All Specified Loss
Proceeds received by the Collateral Agent and all cash Proceeds from investments
thereof pursuant to Section 5.4(b) shall forthwith be deposited into the
Specified Loss Account.
(b) The amount of Specified Loss Proceeds in respect of any Mortgaged
Property shall be increased by the amount of any Proceeds from the investment of
amounts of such Specified Loss Proceeds pursuant to Section 5.5, net of the
amount so invested.
(c) The Collateral Agent will, upon written request from the Grantor,
withdraw cash from the Specified Loss Account and apply such cash to prepay, in
whole or in part, the Notes in accordance with the instructions of the Grantor
set forth in such written request; provided, however, that (i) such
-------- ------- -
instructions are consistent with paragraph 7(c) of the Notes, (ii) such written
--
request specifies the Mortgaged Property the Specified Loss Proceeds in respect
of which are to be reduced in connection with such withdrawal, (iii) the amount
---
by which the Specified
28
Loss Proceeds in respect of any Mortgaged Property are to be reduced does not
exceed the remaining balance of such Specified Loss Proceeds and (iv) any cash
--
withdrawn from the Specified Loss Account pursuant to this Section 5.4(c) shall
be applied to the prepayment of the Notes only at the direction of the Grantor.
(d) Unless an Event of Default or a Change Prepayment Event has
occurred and is continuing, the Collateral Agent will withdraw cash from the
Specified Loss Account and pay such cash at the direction of the Grantor on the
date specified by the Grantor if the following conditions shall have been
satisfied:
(1) The Grantor shall have requested in writing that the Collateral
Agent effect such withdrawal not less than five Business Days prior to the
date on which such cash is to be withdrawn. Such request shall have been
accompanied by (A) a certificate, signed by the chief financial officer of
-
Newco, to the effect that (x) no Event of Default or Change Prepayment
-
Event has occurred and is continuing and (y) the proceeds of such
-
withdrawal are to be used to pay for costs of repairs to or restoration of
the Mortgaged Property in respect of which Specified Loss Proceeds were
received by the Collateral Agent pursuant to Section 4.3 or 4.4 of the
applicable Mortgage and (B) a copy of an invoice or invoices for such costs
-
(the issuer or issuers of which shall not be Affiliates of the Grantor)
evidencing that such costs have been incurred and are then due (or have
been paid).
(2) Such request shall have been received by the Collateral Agent not
sooner than 30 days following the most recent withdrawal from the Specified
Loss Account under this Section 5.4(d).
(3) On the date on which such cash is to be withdrawn, the Collateral
Agent shall have received a
29
certificate bringing down to date the certificate referred to in Section
5.4(d)(1).
(4) The amount of cash to be withdrawn (i) does not exceed the
-
aggregate amount shown on the invoice or invoices accompanying the
certificate delivered pursuant to section 5.4(d)(1) and (ii) when
--
aggregated with all other amounts previously withdrawn pursuant to this
Section with respect to such Mortgaged Property, does not exceed such
Specified Loss Proceeds.
(5) Either (i) the cash withdrawn is paid to the Grantor to reimburse
-
the Grantor for amounts paid to the issuer of the invoice or invoices
accompanying the certificate delivered pursuant to Section 5.4(d)(1) that
are marked "paid" or (ii) the Grantor directs that the cash withdrawn is to
--
be paid to, or at the direction of, the issuer or issuers of any unpaid
invoice or invoices.
(e) Unless an Event of Default has occurred and is continuing, the
Collateral Agent will withdraw cash from the Specified Loss Account and pay such
cash at the direction of the Grantor on the date specified by the Grantor if the
following conditions shall have been satisfied:
(1) The Grantor shall have requested in writing that the Collateral
Agent effect such withdrawal not less than 10 Business Days prior to the
date on which such cash is to be withdrawn. Such request shall have
specified the amount of cash to be withdrawn and specified the Mortgaged
Property the replacement of which is to be effected with the cash to be
withdrawn and shall have been accompanied by (A) a certificate, signed by
-
the chief financial officer of Newco, to the effect that (x) no Event of
-
Default has occurred and is continuing and (y) the proceeds of such
-
withdrawal are to be used to finance the purchase by the Grantor of
Replacement Property from a Person who is not an
30
Affiliate of the Grantor and (B) a copy of a contract for the purchase of
-
the Replacement Property.
(2) On or prior to the date on which such cash is to be withdrawn, the
Collateral Agent shall have received (A) a first mortgage securing the
-
Obligations, in recordable form and otherwise substantially in the form of
the Mortgages, of the Replacement Property, duly executed and delivered by
the Grantor, (B) a title insurance policy, issued by a nationally
-
recognized title insurance company reasonably satisfactory to the
Collateral Agent, insuring the lien of the Collateral Agent's mortgage on
the Replacement Property, subject only to standard exceptions and Permitted
Encumbrances, in an amount not less than the amount of the proposed
withdrawal, and (C) such surveys, environmental audits and documents
-
relating to the Permitted Encumbrances and compliance with Applicable Law
and applicable Governmental Approvals, as reasonably requested by the
Collateral Agent, as shall be reasonably necessary to satisfy the
Collateral Agent that the mortgaging of the Replacement Property to secure
the Obligations and the proposed withdrawal, taken together, would not
materially and adversely affect the aggregate value of the Mortgaged
Property and the Collateral or the rights and remedies of the Collateral
Agent or any of the Secured Parties under the Loan Documents or the ability
of the Collateral Agent or any of the Secured Parties to exercise the same.
(3) On the date on which such cash is to be withdrawn, the Collateral
Agent shall have received a certificate bringing down to date the
certificate referred to in Section 5.4(e)(1)(A).
(4) If the Replacement Property is being purchased in connection with
the purchase by the Grantor, or any of its Affiliates, of any assets or
services from the seller of the Replacement Property or any of its
Affiliates, the Collateral Agent shall be
31
reasonably satisfied that the amount of cash proposed to be withdrawn shall
not be greater than the fair market value of the Replacement Property. If
the Replacement Property is not being purchased in connection with the
purchase by the Grantor, or any of its Affiliates, of any assets or
services from the seller of the Replacement Property or any of its
Affiliates, the Collateral Agent shall be reasonably satisfied that the
amount of cash proposed to be withdrawn shall not be greater than the cash
purchase price for the Replacement Property.
(5) The amount of cash to be withdrawn in respect of any Mortgaged
Property (when aggregated with all other amounts previously withdrawn
pursuant to this Section 5.4 with respect to such Mortgaged Property) does
not exceed the Specified Loss Proceeds received in respect of such
Mortgaged Property.
(6) The Grantor directs that the cash withdrawn is to be paid to, or
at the direction of, the seller of the Replacement Property.
(f) If Specified Loss Proceeds with respect to a Mortgaged Property
have been withdrawn from the Specified Loss Account pursuant to Section 5.4(d),
upon completion of the repairs to such Mortgaged Property the Grantor shall
direct the Collateral Agent pursuant to Section 5.4(c) to apply any balance of
such Specified Loss Proceeds with respect to such Mortgaged Property remaining
in the Specified Loss Account to the prepayment of the Notes. If the Grantor
has notified the Collateral Agent in accordance with the Mortgage that Specified
Loss Proceeds with respect to a Mortgaged Property are to be used to finance the
purchase of Replacement Property pursuant to Section 5.4(e), the Grantor may at
any time and from time to time direct the Collateral Agent pursuant to Section
5.4(c) to apply any portion of such Specified Loss Proceeds with respect to such
Mortgaged Property to the prepayment of the Notes.
32
(g) If an Event of Default has occurred and is continuing, the
Collateral Agent may, in its sole discretion, apply all amounts on deposit in
the Specified Loss Account to satisfy in accordance with Section 6.2 any
Obligations then due and payable.
Section 5.5 Investment. Unless an Event of Default has occurred and
----------
is continuing, the Collateral Agent will accept directions from the Grantor as
to the investment of any funds in any Cash Collateral Account in Permitted
Investments; provided, however, that (i) the Collateral Agent shall not be
-------- ------- -
required to make any investment that, in its sole judgment, would require or
cause the Collateral Agent to be, or would result in, any violation of
Applicable Law or any Governmental Approval, (ii) the Collateral Agent shall be
--
authorized to sell any investment held for the account of any Cash Collateral
Account to the extent cash is needed in such Cash Collateral Account to make a
withdrawal of cash from such Cash Collateral Account (and shall not be liable
for any loss resulting from any such sale) and (iii) the Collateral Agent shall
---
not be required to make any investment unless the Collateral Agent is able to
perfect the Security Interest in such investment. The Grantor will indemnify
the Collateral Agent for any losses resulting from such investments pursuant to
this Section. Except as expressly set forth in this Section, the Collateral
Agent shall not be obligated to invest any amounts on deposit in any Cash
Collateral Account, nor shall any Cash Collateral Account pay interest. The
Collateral Agent shall, upon reasonable request from the Grantor from time to
time, provide the Grantor with a report as to the Collateral Agent's holdings of
Permitted Investments.
ARTICLE VI
REMEDIES
--------
Section 6.1 Remedies upon Default. Upon the occurrence and during
---------------------
the continuance of an Event of Default, the Grantor will deliver each item of
Collateral at
33
the time in the possession of the Grantor to the Collateral Agent on demand, and
it is agreed that the Collateral Agent shall have the right (subject to
applicable law), with or without legal process and with or without previous
notice or demand for performance, to exercise any and all rights afforded to a
secured party under the UCC or other Applicable Law. Without limiting the
generality of the foregoing, the Grantor agrees that the Collateral Agent shall
have the right, subject to the mandatory requirements of current law, to sell or
otherwise dispose of all or any part of the Collateral, at public or private
sale or at any broker's board or on any securities exchange, for cash, upon
credit or for future delivery as the Collateral Agent shall deem appropriate.
The Collateral Agent shall be authorized at any such sale (if it deems it
advisable to do so) to restrict the prospective bidders or purchasers to persons
who will represent and agree that they are purchasing the Collateral for their
own account for investment and not with a view to the distribution or sale
thereof, and upon consummation of any such sale the Collateral Agent shall have
the right to assign, transfer and deliver to the purchaser or purchasers thereof
the Collateral so sold. Each such purchaser at any such sale shall hold the
property sold absolutely, free from any claim or right on the part of the
Grantor, and the Grantor hereby waives (to the extent permitted by law) all
rights of redemption, stay and appraisal which the Grantor now has or may at any
time in the future have under any rule of law or statute now existing or
hereafter enacted.
The Collateral Agent shall give the Grantor 10 days' written notice
(which the Grantor agrees is reasonable notice within the meaning of Section 9-
504(3) of the UCC as in effect in the State of New York or its equivalent in
other jurisdictions) of the Collateral Agent's intention to make any sale of
Collateral. Such notice, in the case of a public sale, shall state the time and
place for such sale and, in the case of a sale at a broker's board or on a
securities exchange, shall state the board or exchange at which such sale is to
be made and the day on which the
34
Collateral, or portion thereof, will first be offered for sale at such board or
exchange. Any such public sale shall be held at such time or times within
ordinary business hours and at such place or places as the Collateral Agent may
fix and state in the notice (if any) of such sale. At any such sale, the
Collateral, or portion thereof, to be sold may be sold in one lot as an entirety
or in separate parcels, as the Collateral Agent may (in its sole and absolute
discretion) determine. The Collateral Agent shall not be obligated to make any
sale of any Collateral if it shall determine not to do so, regardless of the
fact that notice of sale of such Collateral shall have been given. The
Collateral Agent may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for sale, and such sale may, without further notice,
be made at the time and place to which the same was so adjourned. In case any
sale of all or any part of the Collateral is made on credit or for future
delivery, the Collateral so sold may be retained by the Collateral Agent until
the sale price is paid by the purchaser or purchasers thereof, but the
Collateral Agent shall not incur any liability in case any such purchaser or
purchasers shall fail to take up and pay for the Collateral so sold and, in case
of any such failure, such Collateral may be sold again upon like notice. At any
public sale made pursuant to this Section, any Secured Party may bid for or
purchase, free (to the extent permitted by law) from any right of redemption,
stay, valuation or appraisal on the part of the Grantor (all said rights being
also hereby waived and released to the extent permitted by law), the Collateral
or any part thereof offered for sale and may make payment on account thereof by
using any claim under any Loan Document then due and payable to such Secured
Party from the Grantor as a credit against the purchase price, and such Secured
Party may, upon compliance with the terms of sale, hold, retain and dispose of
such property without further accountability to the Grantor therefor. For
purposes hereof, a written agreement to purchase the Collateral or any portion
thereof shall be treated as a sale thereof; the Collateral Agent shall be
35
free to carry out such sale pursuant to such agreement and the Grantor shall not
be entitled to the return of the Collateral or any portion thereof subject
thereto, notwithstanding the fact that after the Collateral Agent shall have
entered into such an agreement all Events of Default shall have been remedied
and the Obligations paid in full. As an alternative to exercising the power of
sale herein conferred upon it, the Collateral Agent may proceed by a suit or
suits at law or in equity to foreclose this Agreement and to sell the Collateral
or any portion thereof pursuant to a judgment or decree of a court or courts
having competent jurisdiction or pursuant to a proceeding by a court-appointed
receiver.
Section 6.2 Application of Proceeds. The Collateral Agent shall
-----------------------
apply the proceeds of any collection or sale of the Collateral, as well as any
Collateral consisting of cash and any amounts paid to the Collateral Agent
pursuant to any Mortgage, as follows:
FIRST, to the payment of all costs and expenses incurred by the
Collateral Agent in connection with such collection or sale or otherwise in
connection with this Agreement, any of the Mortgages or any of the
Obligations, including all court costs and the reasonable fees and expenses
of its agents and one legal counsel for it and the holders of the Notes
(plus any necessary local counsel), the repayment of all advances made by
the Collateral Agent hereunder or under any Mortgage on behalf of the
Grantor and any other costs or expenses incurred in connection with the
exercise of any right or remedy hereunder or under any Mortgage;
SECOND, to the payment in full of the Obligations other than the
payment of the Accreted Value of the Notes and other than all monetary
obligations of the Grantor under the Guaranty Agreement (the amounts so
36
applied to be distributed among the Secured Parties pro rata in accordance
with the amounts of such Obligations owed to them on the date of any such
distribution);
THIRD, to the payment in full of the Accreted Value of the Notes (the
amounts so applied to be distributed among the Secured Parties pro rata in
accordance with the Accreted Value of the Notes held by them on the date of
any such distribution);
FOURTH, to the payment in full of all monetary obligations of the
Grantor under the Guaranty Agreement (the amounts so applied to be
distributed among the Secured Parties pro rata in accordance with the
amounts of such Obligations owed to them on the date of any such
distribution); and
FIFTH, to the Grantor or its successors, or to whomsoever may lawfully
be entitled to receive the same.
The Collateral Agent shall have absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Agreement; provided, however, that the Collateral Agent shall apply such
-------- -------
proceeds, moneys or balances within six months of receipt thereof (such six
months to be subject to extension during any period for which the Collateral
Agent is not permitted by Applicable Law or this Agreement to apply such
proceeds, moneys or balances). Upon any sale of the Collateral by the
Collateral Agent (including pursuant to a power of sale granted by statute or
under a judicial proceeding), the receipt of the Collateral Agent or of the
officer making the sale shall be a sufficient discharge to the purchaser or
purchasers of the 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 Collateral Agent or such officer or be answerable in any way for the
misapplication thereof.
37
ARTICLE VII
RIGHTS AND DUTIES OF COLLATERAL AGENT
-------------------------------------
Section 7.1 Delegation of Duties. The Collateral Agent may execute
--------------------
any of its duties under any Loan Document by or through agents or attorneys-in-
fact and shall be entitled to advice of counsel or other advisors concerning all
matters pertaining to its duties and rights hereunder. The Collateral Agent
shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care except to the extent
otherwise expressly required by Section 7.2 or 8.3.
Section 7.2 Powers; General Immunity. (a) Each Secured Party, by
------------------------
its acquisition of any Note or Canadian Note, irrevocably authorizes the
Collateral Agent to take such action on such Secured Party's behalf and to
exercise such powers under the Loan Documents as are specifically delegated to
it by the terms thereof, together with such powers as are reasonably incidental
thereto. The Collateral Agent shall have only those duties and responsibilities
which are expressly specified in the Loan Documents and it may perform such
duties by or through its agents or employees. The duties of the Collateral
Agent shall be mechanical and administrative in nature; and the Collateral Agent
shall not have by reason of any Loan Document a fiduciary relationship in
respect of any Secured Party; and nothing in any of the Loan Documents,
expressed or implied, is intended to or shall be so construed as to impose upon
the Collateral Agent any obligations in respect of any of the Loan Documents
except as expressly set forth therein.
(b) The Collateral Agent shall not be responsible to any Secured Party
for the execution, effectiveness, genuineness, validity, enforceability,
collectability or sufficiency of any of the Loan Documents or for any Liens or
Guaranties granted by, or purported to be granted by, any of the Loan Documents,
or for any representations, warranties, recitals or statements made herein or
therein or made in any written or oral statement or in any financial or other
38
statements, instruments, reports, certificates or any other documents in
connection herewith or therewith furnished or made by the Collateral Agent to
any Secured Party or by or on behalf of Buyer, Newco, the Grantor or the
Canadian Buyer, to the Collateral Agent or any Secured Party, or be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
of the existence or possible existence of any Default or Event of Default.
(c) Notwithstanding anything to the contrary in this Agreement,
neither the Collateral Agent, nor any of its officers, directors, employees,
agents, investigators, consultants, attorneys-in-fact or affiliates shall be
liable to any Secured Party for any action taken or omitted under any of the
Loan Documents or in connection herewith or therewith unless, but only to the
extent, caused by its or their gross negligence or willful misconduct. If the
Collateral Agent shall request instructions with respect to any act or action
(including the failure to take an action) in connection with any of the Loan
Documents, the Collateral Agent shall be entitled to refrain from such act or
taking such action unless and until it shall have received instructions from the
Required Mortgage Lenders. Without prejudice to the generality of the
foregoing, (i) the Collateral Agent shall be entitled to rely, and shall be
-
fully protected in relying, upon any communication, instrument or document
believed by it to be genuine and correct and to have been signed or sent by the
proper person or persons, and shall be entitled to rely and shall be protected
in relying on opinions and judgments of attorneys (who may be attorneys for the
Grantor or its Affiliates), accountants, experts and other professional advisors
selected by it; and (ii) no Secured Party shall have any right of action
--
whatsoever against the Collateral Agent as a result of the Collateral Agent
acting or (where so instructed) refraining from acting under any Loan Document
in accordance with the instructions of the Required Mortgage Lenders. The
Collateral Agent shall be entitled to refrain
39
from exercising any power, discretion or authority vested in it under the Loan
Documents unless and until it has obtained the instructions of the Required
Mortgage Lenders.
(d) The agency hereby created shall in no way impair or affect any of
the rights and powers of, or impose any duties or obligations upon, the
Collateral Agent in its individual capacity as a Secured Party. With respect to
any Notes or Canadian Notes that it holds, the Collateral Agent shall have the
same rights and powers hereunder as any other Secured Party and may exercise the
same as though it were not performing the duties and functions delegated to it
hereunder. The Collateral Agent and its Affiliates may accept deposits from,
lend money to and generally engage in any kind of banking, trust, financial
advisory or any other business with the Grantor or any Affiliate of the Grantor
as if it were not performing the duties specified herein, and may accept fees
and other consideration from the Grantor or any Affiliate of the Grantor without
having to account for the same to the Secured Parties.
(e) Without limiting the foregoing, the Collateral Agent may deem and
treat the holder of any Note or any Canadian Note as the owner thereof for all
purposes. Any request, authority or consent of any Person who, at the time of
making such request or giving such authority or consent, is the holder of any
Note or Canadian Note shall be conclusive and binding on any subsequent holder,
transferee or assignee of that Note or Canadian Note or of any Note or Canadian
Note issued in exchange therefor.
(f) The Collateral Agent shall be entitled to rely, and shall be fully
protected in relying, on the Register and the copies of the "Register" (as
defined in the Canadian Notes), in each case as provided to the Collateral Agent
by the Grantor pursuant to Section 4.10, for purposes of determining the names
and addresses of the holders of the Notes and the Canadian Notes.
40
Section 7.3 Non-Reliance on Agent. Each Secured Party, by its
---------------------
acquisition of any Note or Canadian Note, expressly acknowledges that neither
the Collateral Agent, nor any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates have made any representations or warranties to
it and that no act by the Collateral Agent hereinafter taken shall be deemed to
constitute any representation or warranty by such Person. The Collateral Agent
shall not have any duty or responsibility either initially or on a continuing
basis to make any such investigation or any such appraisal on behalf of the
Secured Parties or to provide any Secured Party with any credit or other
information with respect thereto, and the Collateral Agent shall not have any
responsibility with respect to the accuracy of or the completeness of any
information provided to the Secured Parties.
Section 7.4 Determinations Pursuant to Loan Documents. In each
-----------------------------------------
circumstance where, under any provision of any Loan Document, the Collateral
Agent shall have the right to grant or withhold any consent, exercise any
remedy, make any determination or direct any action under such Loan Document,
the Collateral Agent shall act in respect of such consent, exercise of remedies,
determination or action, as the case may be, only with the consent of and at the
direction of the Required Mortgage Lenders; provided, however, that (i) no such
-------- ------- -
consent of the Required Mortgage Lenders shall be required with respect to any
consent, determination or other matter that is, in the Collateral Agent's
reasonable judgment, ministerial or administrative in nature or provided for in
such Loan Document, (ii) the Collateral Agent is hereby authorized on behalf of
--
all of the Secured Parties, without the necessity of any further consent from
any Secured Party, from time to time prior to an Event of Default, to release
the security interests and Liens imposed by the Mortgage Documents in connection
with any dispositions permitted by the terms of the Mortgage Documents or as may
be required by Applicable Law and (iii) the Collateral Agent may in its
---
discretion take such action as it deems necessary, without the consent or
41
direction of the Required Mortgage Lenders, if in the good faith determination
of the Collateral Agent the interests of the Secured Parties would be adversely
affected were such action to be delayed pending the obtaining of such consent or
direction. In each circumstance where any consent of or direction from the
Required Mortgage Lenders is required, the Collateral Agent shall send to the
Secured Parties a notice setting forth a description in reasonable detail of the
matter as to which consent or direction is requested and the Collateral Agent's
proposed course of action with respect thereto. In the event the Collateral
Agent shall not have received a response from any Secured Party within five
Business Days after the giving of such notice (unless such notice is given by
mail, in which case 10 Business Days after the giving of such notice), such
Secured Party shall be deemed to have agreed to the course of action proposed by
the Collateral Agent, provided that such notice states that a failure to respond
shall have the consequences specified in this sentence.
Section 7.5 Resignation of the Collateral Agent. The Collateral Agent
-----------------------------------
may at any time, by giving 30 days' prior written notice to the Grantor, resign
and be discharged from the responsibilities hereby created, such resignation to
become effective upon the earlier of (i) the acceptance of the appointment of a
-
successor pursuant to the next sentence of this Section or (ii) the appointment
--
of a successor by the Required Mortgage Lenders and the acceptance of such
appointment by such successor. If no successor shall be appointed and approved
pursuant to clause (ii) above within 30 days after the date of any such
resignation, the Collateral Agent may apply to any court of competent
jurisdiction to appoint a successor to act until a successor shall have been
appointed by the Required Mortgage Lenders as above provided or may, on behalf
of the Secured Parties, appoint a successor Collateral Agent. Any successor
Collateral Agent shall be (A) a bank with an office in New York, New York,
-
having a combined capital and surplus of at least $500,000,000 that is
authorized to perform the functions of the Collateral Agent hereunder or
42
(B) the holder of a majority in outstanding Accreted Value of the Notes. Any
-
successor Collateral Agent shall assume the obligations of the retiring
Collateral Agent under the Landlord Lien Waiver dated the Closing Date among
BCI, the Grantor and Seller, as initial Collateral Agent.
ARTICLE VII
MISCELLANEOUS
-------------
Section 8.1 Security Interest Absolute; Release of Security Interest.
--------------------------------------------------------
(a) All rights of the Collateral Agent hereunder, the Security Interest and all
obligations of the Grantor hereunder shall be absolute and unconditional
irrespective of (a) any lack of validity or enforceability of the Notes (or any
-
Guaranty endorsed thereon), any Mortgage or the Guaranty Agreement, any
agreement with respect to any of the Obligations or any other agreement or
instrument relating to any of the foregoing, (b) any change in the time, manner
-
or place of payment of, or in any other term of, all or any of the Obligations,
or any other amendment or waiver of or any consent to any departure from the
Notes (or any Guaranty endorsed thereon), any Mortgage or the Guaranty Agreement
or any other agreement or instrument, (c) any exchange, release or non-
-
perfection of any Lien on other collateral, or any release or amendment or
waiver of or consent under or departure from any guarantee, securing or
guaranteeing all or any of the Obligations, or (d) any other circumstance which
-
might otherwise constitute a defense available to, or a discharge of, the
Grantor in respect of the Obligations or this Agreement, except the payment in
full of the Obligations and except for any matter approved in writing by the
Required Mortgage Lenders and the Collateral Agent.
(b) The consent or approval of any Secured Party shall not be required
for the release of any Collateral by the Collateral Agent to the Grantor in
accordance with the express provisions of this Agreement.
43
Section 8.2 Successors. Whenever in this Agreement any of the
----------
parties hereto is referred to, such reference shall be deemed to include the
successors of such party (including, in the case of the Collateral Agent, any
successor Collateral Agent); and all covenants, promises and agreements by or on
behalf of the Grantor or the Collateral Agent that are contained in this
Agreement shall bind and inure to the benefit of their respective successors
(including, in the case of the Collateral Agent, any successor Collateral
Agent).
Section 8.3 Collateral Agent Appointed Attorney-in-Fact. The Grantor
-------------------------------------------
hereby appoints the Collateral Agent the attorney-in-fact of the Grantor, with
power of substitution and in the Grantor's name or otherwise, for the purpose of
carrying out the provisions of this Agreement and taking any action and
executing any instrument which the Collateral Agent may reasonably deem
necessary or advisable to accomplish the purposes hereof, including, upon the
occurrence and during the continuance of an Event of Default, the power to (a)
-
receive, endorse, assign and/or deliver any and all notes, acceptances, checks,
drafts, money orders or other evidences of payment relating to the Collateral or
any part thereof; (b) demand, collect, receive payment of, give receipt for and
-
give discharges and releases of all or any of the Collateral; (c) commence and
-
prosecute any and all suits, actions or proceedings at law or in equity in any
court of competent jurisdiction to collect or otherwise realize on all or any of
the Collateral or to enforce any rights in respect of any Collateral; (d)
-
settle, compromise, compound, adjust or defend any actions, suits or proceedings
relating to all or any of the Collateral; and (e) use, sell, assign, transfer,
-
pledge, make any agreement with respect to or otherwise deal with all or any of
the Collateral, and to do all other acts and things necessary to carry out the
purposes of this Agreement, as fully and completely as though the Collateral
Agent were the absolute owner of the Collateral for all purposes; provided,
--------
however, that nothing herein contained shall be construed as requiring or
-------
obligating the Collateral
44
Agent to make any commitment or to make any inquiry as to the nature or
sufficiency of any payment received by the Collateral Agent, or to present or
file any claim or notice, or to take any action with respect to the Collateral
or any part thereof or the moneys due or to become due in respect thereof or any
property covered thereby, and no action taken or omitted to be taken by the
Collateral Agent with respect to the Collateral or any part thereof shall give
rise to any defense, counterclaim or offset in favor of the Grantor or to any
claim or action against the Collateral Agent other than any such matter to the
extent arising out of the gross negligence or willful misconduct of the
Collateral Agent. It is understood and agreed that the appointment of the
Collateral Agent as the agent and attorney-in-fact of the Grantor for the
purposes set forth above is coupled with an interest and is irrevocable. The
provisions of this Section shall in no event relieve the Grantor of any of its
obligations hereunder or under any Mortgage with respect to the Collateral or
any part thereof or impose any obligation on the Collateral Agent or any Secured
Party to proceed in any particular manner with respect to the Collateral or any
part thereof, or in any way limit the exercise by the Collateral Agent or any
Secured Party of any other or further right which it may have on the date of
this Agreement or hereafter, whether hereunder, by law or otherwise; provided,
--------
however, that the Collateral Agent's sole duty with respect to the custody,
-------
safekeeping and physical preservation of the Collateral in its possession, under
Section 9-207 of the UCC or otherwise, shall be to deal with it in the same
manner as the Collateral Agent deals with similar property for its own account.
Section 8.4 Collateral Agent's Expenses; Indemnification. (a) The
--------------------------------------------
Grantor will pay upon demand to the Collateral Agent the amount of any and all
reasonable expenses, including the reasonable fees and expenses of one counsel
for it and the holders of the Notes (plus any necessary local counsel), of any
experts or agents and of any financial institution with which any Cash
Collateral Account is maintained, which the Collateral Agent may incur
45
in connection with (i) the administration of the Mortgage Documents, (ii) the
- --
custody, preservation or investment of, or the sale of, collection from or other
realization upon any of the Collateral, (iii) the exercise, enforcement or
---
protection of any of the rights of the Collateral Agent hereunder or under any
Mortgage or (iv) the failure of the Grantor to perform or observe any of the
--
provisions hereof, other than any such expenses to the extent arising out of the
gross negligence or willful misconduct of the Collateral Agent.
(b) The Grantor will indemnify the Collateral Agent against, and hold
it harmless from, any and all losses, claims, damages, liabilities and related
expenses, including reasonable counsel fees and expenses, incurred by or
asserted against it arising out of, in any way connected with, or as a result
of, the execution, delivery or performance of any Mortgage Document, or any
exercise of remedies thereunder, or any claim, litigation, investigation or
proceeding relating hereto or to the Collateral or any Mortgage or Mortgaged
Property, whether or not a party thereto, other than, and only to the extent,
caused by the gross negligence or willful misconduct of the Collateral Agent.
(c) Any such amounts payable as provided hereunder shall be
additional Obligations. The provisions of this Section shall remain operative
and in full force and effect regardless of the termination of this Agreement,
the consummation of the transactions contemplated hereby, the invalidity or
unenforceability of any term or provision of this Agreement, any Note, the
Guaranty Agreement or any Mortgage, or any investigation made by or on behalf of
the Collateral Agent. All amounts due under this Section shall be payable on
written demand therefor.
Section 8.5 Waivers; Amendment. (a) No failure or delay of the
------------------
Collateral Agent in exercising any power or right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power,
46
or any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Collateral Agent hereunder are
cumulative and are not exclusive of any rights or remedies which it would
otherwise have. No waiver of any provisions of this Agreement or consent to any
departure by the Grantor therefrom shall in any event be effective unless the
same shall be permitted by Section 8.5(b), and then such waiver or consent shall
be effective only in the specific instance and for the purpose for which given.
No notice or demand on the Grantor in any case shall entitle the Grantor to any
other or further notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Collateral Agent and the Grantor with respect to which such
waiver, amendment or modification is to apply, subject to any consent required
in accordance with paragraph 14 of the Notes.
Section 8.6 Termination. This Agreement (including the
-----------
representations and warranties herein) and the Security Interest shall terminate
when and only when all the Obligations have been paid in full. Upon such
termination, the Collateral Agent shall forthwith assign, transfer and deliver
any Collateral in the possession or under the control of the Collateral Agent
(including any Collateral in any Cash Collateral Account) to or on order of the
Grantor and, at the Grantor's expense, execute and deliver to the Grantor such
documents as the Grantor shall reasonably request to evidence such termination.
Any execution and delivery of such documents shall be without recourse to or
warranty by the Collateral Agent.
Section 8.7 Severability. If any provision of this Agreement is
------------
inoperative or unenforceable for any reason, such circumstances shall not have
the effect of
47
rendering the provision in question inoperative or unenforceable in any other
case or circumstance, or of rendering any other provision or provisions herein
contained invalid, inoperative or unenforceable to any extent whatsoever. The
invalidity of any one or more phrases, sentences, clauses, Sections or
subsections of this Agreement shall not affect the remaining portions of this
Agreement.
Section 8.8 Notices. All notices and other communications made in
-------
connection with this Agreement shall be in writing. Any notice or other
communication in connection herewith shall be deemed duly given (a) four
Business Days after it is sent by express, registered or certified mail, return
receipt requested, postage prepaid or (b) one Business Day after it is sent by
overnight courier, in each case, addressed as follows:
(i) if to the Grantor:
CDW Realco, Inc.
Xxx Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: Chief Financial Officer
with a copy to:
CDW Acquisition Corporation
Xxx Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: Chief Financial Officer
and to:
Debevoise & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxx
48
(ii) if to the Collateral Agent:
Westinghouse Electric Corporation
Westinghouse Building
Gateway Center
00 Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: Treasurer
with a copy to the attention
of the General Counsel
(telecopy: (000) 000-0000)
or, in each case, at such other address as may be specified in writing to the
other parties hereto. Any party may give any notice or other communication in
connection herewith using any other means (including, without limitation,
personal delivery, messenger service, telecopy, telex or ordinary mail), but no
such notice or other communication shall be deemed to have been duly given
unless and until it is actually received by the individual for whom it is
intended.
Section 8.9 Headings. The headings contained in this Agreement are
--------
for purposes of convenience only and shall not affect the meaning or
interpretation of this Agreement.
Section 8.10 Entire Agreement. This Agreement, together with the
----------------
Acquisition Agreement, the Notes, the Canadian Notes, the Mortgages and the
Guaranty Agreement, constitutes the entire agreement and supersedes all prior
agreements and understandings, both written and oral, between the parties with
respect to the subject matter hereof.
Section 8.11 Counterparts. This Agreement may be executed in several
------------
counterparts, each of which shall be
49
deemed an original and all of which shall together constitute one and the same
instrument.
Section 8.12 Governing Law. This Agreement shall be governed in all
-------------
respects, including as to validity, interpretation and effect, by the internal
laws of the State of New York, without giving effect to the conflict of laws
rules thereof.
Section 8.13 No Third Party Beneficiaries. Nothing in this Agreement
----------------------------
shall confer any right upon any person or entity other than the parties hereto,
the Secured Parties and each such party's respective successors and permitted
assigns.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
CDW REALCO, INC.,
By /s/
---------------------------------------
Name:
Title:
WESTINGHOUSE ELECTRIC CORPORATION, as Collateral
Agent,
By /s/
---------------------------------------
Name:
Title:
50
Exhibit A
---------
Debtor: Secured Party:
WESCO Distribution, Inc. Westinghouse Electric
One Riverfront Center Corporation, as
Xxxxxxxxxx, XX 00000 Collateral Agent
Attention: Chief Financial Westinghouse Building
Officer Gateway Center
00 Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: Treasurer
All of Debtor's accounts, chattel paper, documents, general intangibles,
instruments, or securities (whether certificated or uncertificated), in each
case now in existence or hereafter arising or acquired, and all proceeds of or
substitutions for, any and all of the foregoing collateral and, to the extent
not otherwise included, all payments under insurance or any indemnity, warranty,
or guaranty payable by reason of loss or damage to or otherwise with respect to
any of the foregoing collateral, and all cash, wherever located.
[to be typed on face of UCC form]
All of Debtor's accounts, chattel paper, documents, general intangibles,
instruments or securities now or hereafter arising or acquired, and all proceeds
of any of the foregoing, and all payments under insurance or any indemnity
payable with respect to any of the foregoing, and all cash, all as more fully
described on the attached Schedule A.
2
Schedule 3.02A
to
Cash Collateral Agreement
Filings
-------
UCC-1 financing statements, in substantially the form of Exhibit A attached
hereto, filed in the following jurisdictions:
Delaware
--------
Secretary of State
New York
--------
Secretary of State
Pennsylvania
------------
Secretary of State
Allegheny County
