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EXHIBIT 10.8
COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT
THIS COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT is dated as of June 25,
1998, among the banks listed on the signature pages hereof (together with their
respective successors and assigns and any other bank or financial institution
that becomes a party to the Bank Agreement in accordance with the terms thereof,
the "BANKS"), the holders of the Senior Notes listed on the signature pages
hereof (together with their respective successors and assigns, the "NOTEHOLDERS"
and, together with the Banks, the "LENDERS"), Bank One, Texas, N.A., as agent
under the Bank Agreement (in such capacity, together with its successors and
assigns, the "FACILITY AGENT") and as collateral agent hereunder (in such
capacity, together with its successors and assigns, the "COLLATERAL AGENT") and
Hydril Company, a Delaware corporation (the "COMPANY").
1. PRELIMINARY STATEMENTS
1.1 Pursuant to the separate Note Purchase Agreements, each dated as of
June 25, 1998 (collectively, as amended, restated, modified or supplemented from
time to time, the "NOTE AGREEMENTS"), between the Company and each of the
purchasers listed in Schedule A attached thereto, the Company has issued and
sold to SUCH purchasers $60,000,000 in aggregate principal amount of its 6.85%
Senior Secured Notes Due June 30, 2003 (as amended, restated, modified or
supplemented from time to lime, the "SENIOR NOTES"). The Noteholders are the
holders of all of the Senior Notes currently outstanding.
1.2 Pursuant to an Amended and Restated Loan Agreement, dated as of March
23, 1998, as amended by a First Amendment to Amended and Restated Loan
Agreement, dated as of June 25, 1998 (as May be further amended, restated,
modified or supplemented from time to time, the "BANK AGREEMENT"), among the
Company, the Facility Agent and the Banks, the Banks have agreed to make
available to the Company a revolving loan facility in an aggregate principal
amount not to exceed $15,000,000 (the "BANK LOAN").
1.3 Pursuant to the provisions of the Collateral Documents, the Company
has granted to the Collateral Agent, for the equal and ratable benefit of the
Lenders, security interests in and Liens on certain property of the Company, as
more specifically described in the Collateral Documents (such property, together
with (x) all amounts payable under any title insurance policy identified on
Schedule A hereto and (y) all assets and property of the Company that may
hereafter be subject to a Lien securing the Secured Obligations, the
"COLLATERAL") to secure the payment and performance of the Secured Obligations.
1.4 The Banks and the Noteholders wish to define their rights and
obligations with respect to each other such that certain amounts received by the
Collateral Agent, the Facility Agent or any Lender in connection with the
Collateral and the Secured Obligations shall be shared among all Lenders equally
and ratably in accordance with the respective amounts of the Secured Obligations
then held by each of them, all as set forth in this Agreement
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, the parties hereto hereby agree as follows:
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2. INTERPRETATION OF THIS AGREEMENT
2.1. DEFINED TERMS.
As used in this Agreement, capitalized terms have the respective meanings
specified below or set forth in the section of this Agreement referred to
immediately following such term (such definitions, unless otherwise expressly
provided, to be equally applicable to both the singular and plural forms of the
terms defined):
AGREEMENT, THIS -- means this Collateral Agency and Intercreditor
Agreement, as it may be amended, modified, supplemented or restated from
time to time.
BANK AGREEMENT -- has the meaning set forth in Section 1.2.
BANK EVENT OF DEFAULT -- means an "Event of Default" under, and as
defined in, the Bank Agreement.
BANK LOAN -- has the meaning set forth in Section 1.2.
BANK SECURED OBLIGATIONS -- means, collectively, all amounts owing
by the Company to the Banks and the Facility Agent, pursuant to the terms
of the Bank Agreement, in respect of principal, interest, fees and
expenses.
BANKS -- has the meaning set forth in the first paragraph of this
Agreement.
COLLATERAL -- has the meaning set forth in Section 1.3.
COLLATERAL AGENT -- has the meaning set forth in the first paragraph
of this Agreement.
COLLATERAL DOCUMENTS -- means each document set forth in Schedule A
hereto (other than title insurance policies) and any other security
agreement, pledge agreement, collateral assignment, mortgage or other
instrument or agreement relating to the Collateral, whether existing on or
entered into after the date hereof, but shall not include the Bank
Agreement or the Note Agreements.
COMPANY -- has the meaning set forth in the first paragraph of this
Agreement.
EVENT OF DEFAULT -- means, collectively, a Bank Event of Default and
a Note Event of Default.
FACILITY AGENT -- has the meaning set forth in the first paragraph
of this Agreement.
LENDERS -- has the meaning set forth in the first paragraph of this
Agreement.
LIEN -- means, with respect to any Person, any mortgage, lien,
pledge, charge, security interest or other encumbrance, or any interest or
title of any vendor, lessor, lender or other secured party to or of such
Person under any conditional sale or other title
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retention agreement or capital lease, upon or with respect to any property
or asset of such Person (including in the case of stock, stockholder
agreements, voting trust agreements and all similar arrangements).
MAKE-WHOLE AMOUNT -- has the meaning set forth in the Note
Agreements.
NOTE AGREEMENTS -- has the meaning set forth in Section 1.1.
NOTE EVENT OF DEFAULT -- means an "Event of Default" under, and as
defined in, the Note Agreements.
NOTEHOLDER SECURED OBLIGATIONS -- means, collectively, all amounts
owing by that Company to each Noteholder, pursuant to the terms of the
Note Agreements and the Senior Notes, in respect of principal, interest,
Make-Whole Amount, fees and expenses.
NOTEHOLDERS -- has the meaning set forth in the first paragraph of
this Agreement.
NOTICE OF DEFAULT -- means a written notification given by or on
behalf of any Lender or the Facility Agent certifying that a Bank Event of
Default or a Note Event of Default, as the case may be, has occurred.
NOTICE OF SHARED PAYMENT -- means a written notification given by or
on behalf of any Lender or the Facility Agent stating that such Lender or
the Facility Agent, as the case may be, has received a Shared Payment.
PERSON -- means an individual, partnership, corporation, limited
liability company or partnership, joint stock company, trust,
unincorporated association, joint venture, governmental agency or other
authority.
RECEIVING LENDER -- has the meaning set forth in Section 4.4.
REORGANIZATION -- means, with respect to any Person, (a) any
distribution of the property and assets of such Person upon any voluntary
or involuntary dissolution, winding up, total or partial liquidation or
reorganization, (b) any bankruptcy or other action pursuant to Title 11 of
the United States Code or any rule or regulation promulgated pursuant
thereto with respect to such Person, (c) any insolvency, receivership or
other statutory or common law proceeding or arrangement with respect to
such Person, or its assets, properties or operations, (d) any readjustment
of the material obligations, individually or in the aggregate, of such
Person, (a) any assignment for the benefit of creditors of such Person, or
(f) any marshalling of the assets, properties or obligations of such
Person.
REQUISITE BANKS -- means the holder or holders of at least 66-2/3%
of the aggregate principal amount of the Bank Secured Obligations from
time to time outstanding, exclusive of Bank Secured Obligations then owned
by any one or more of the Company, any subsidiary of the Company or any
affiliate of the Company.
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REQUISITE LENDERS -- means
(a) the holder or holders of at least 66-2/3% of the
aggregate principal amount of the Noteholder Secured
Obligations from time to time outstanding, and
(b) the holder or holders of at least 66-2/3% of the
aggregate principal amount of the Bank Secured Obligations
from time to time outstanding,
in each case exclusive of Noteholder Secured Obligations and Bank
Secured Obligations then owned by any one or more of the Company,
any subsidiary of the Company or any affiliate of the Company.
REQUISITE NOTEHOLDERS -- means the holder or holders of at least
66-2/3% of the aggregate principal amount of the Noteholder Secured
Obligations from time to time outstanding, exclusive of Noteholder Secured
Obligations then owned by any one or more of the Company, any subsidiary
of the Company or any affiliate of the Company.
RESERVE ACCOUNT -- has the meaning set forth in Section 4.4.
SECURED OBLIGATIONS -- means, collectively, the Bank Secured
Obligations and the Noteholder Secured Obligations.
SENIOR NOTES -- has the meaning set forth in Section 1.1.
SHARED PAYMENT -- has the meaning set forth in Section 4.4.
2.2. CERTAIN OTHER TERMS.
The words "hereof," "herein" and "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement. Section references are to this
Agreement unless otherwise specified. All terms defined in this Agreement in the
singular shall have comparable meanings when used in the plural, and vice versa,
unless otherwise specified.
3. APPOINTMENT OF COLLATERAL AGENT
Each of the Lenders hereby appoints Bank One, Texas, N.A. as Collateral
Agent to act as specified herein and as specified in any of the Collateral
Documents, and Bank One Texas, N.A. hereby accepts such appointment and agrees
to act as Collateral Agent hereunder.
4. SECURED OBLIGATIONS
4.1. SECURED OBLIGATIONS PARI PASSU.
Each of the Lenders and the Collateral Agent hereby agrees that the Liens
on the Collateral secure on a pari passu basis all of the Noteholder Secured
Obligations and the Bank Secured Obligations, notwithstanding:
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(a) any contrary provisions of the Note Agreements or the Bank
Agreement or any document executed in connection therewith;
(b) the invalidity, or any period in time of creation, attachment or
perfection, of any Lien on any Collateral;
(c) the time or sequence in which any documentation relative or
pertaining to the Note Agreements, the Bank Agreement, the Secured
Obligations or the Collateral Documents was executed or delivered;
(d) the time or sequence in which any Secured Obligations become due
(whether at their stated maturity, by acceleration or otherwise) or were
or are incurred; or
(e) the time or sequence of commencement or completion of any
proceeding to enforce or collect the Secured Obligations or the time or
sequence in which any order or judgment in respect thereof is made or
entered or any execution is obtained or registered or any other proceeding
is commenced or completed.
4.2. PAYMENTS PRIOR TO AN EVENT OF DEFAULT.
Prior to a Note Event of Default or a Bank Event of Default, the Company
shall make payments of the Noteholder Secured Obligations and the Bank Secured
Obligations as due in accordance with the terms of the Note Agreements and the
Bank Agreement, respectively.
4.3. EVENT OF DEFAULT; RECEIPT OF SHARED PAYMENT.
Each Noteholder shall give a Notice of Default or a Notice of Shared
Payment, as applicable, to each other Noteholder and the Facility Agent
immediately upon any Note Event of Default or the receipt by such Noteholder of
a Shared Payment. Each Bank shall give a Notice of Default or a Notice of Shared
Payment, as applicable, to the Facility Agent and each Noteholder immediately
upon any Bank Event of Default or the receipt by any Bank of a Shared Payment.
4.4. SHARING OF PAYMENTS.
Each Lender and the Facility Agent (each, a "RECEIVING LENDER") agrees
that any payment of any kind (including, without limitation, any payment
resulting from a set-off of a deposit account) received by it on account of the
Secured Obligations (each such payment, a "SHARED PAYMENT") from or on behalf of
the Company at any time after the occurrence of a Note Event of Default or a
Bank Event of Default is to be distributed among the Lenders, after payment
therefrom of any sum (including agency fees) then due and payable under this
Agreement to the Collateral Agent for its own account, equally and ratably in
accordance with the respective amounts of the Secured Obligations then held by
each Lender, without discrimination or preference, with any balance remaining
after such distribution among the Lenders to be distributed to whomever may be
lawfully entitled to receive the same, or as a court of competent jurisdiction
may direct. Each Receiving Lender shall hold all Shared Payments received by it
in trust for the benefit of all Lenders. Notwithstanding any provision in any
Collateral Document setting forth priorities with respect to the application of
the proceeds of any Collateral, distributions of Shared Payments (including,
without limitation, proceeds from
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Collateral) shall be as set forth in this Section 4.4. To the extent that any
amounts available for distribution pursuant to this Section 4.4 are attributable
to the Bank Secured Obligations that relate to undrawn amounts under the Letters
of Credit (as such term is defined in the Bank Agreement), such amounts shall be
held in a reserve or other account unavailable to the Company (the "RESERVE
ACCOUNT") to be established by the Collateral Agent. Amounts in the Reserve
Account shall be used from time to time to pay the applicable Bank Secured
Obligations in respect of the Letters of Credit as they become due. Any amounts
remaining in the Reserve Account following the expiration or satisfaction in
full of the Bank Secured Obligations for which such sums were held in reserve
shall be applied against any Secured Obligations remaining unpaid in accordance
with this Section 4.4.
4.5. REMITTANCES.
Each Receiving Lender shall remit any Shared Payment received by it to the
Collateral Agent for distribution in accordance with Section 4.4. Upon receipt
of any Shared Payment, the Collateral Agent shall calculate the amount of such
Shared Payment distributable to each Lender pursuant to Section 4.4 as of the
date the Receiving Lender received such Shared Payment and remit such amount to
each Lender, accompanied by computations in reasonable detail showing the manner
of calculation of the amounts distributable to each Lender pursuant to
Section 4.4.
4.6. INVALIDATED PAYMENTS.
If any amount distributed by the Collateral Agent to the lenders in
accordance with the provisions of this Agreement is subsequently required to be
returned or repaid to the Company or its representatives or successors in
interest, whether by court order, settlement or otherwise, each Lender shall,
promptly upon its receipt of notice thereof from the Collateral Agent, pay to
the Collateral Agent the pro rata portion received by it of such amount for
payment to the Company or its representatives or successors in interest. If any
such amounts are subsequently recovered by any Lender from the Company or its
representatives or successors in interest, such Lender shall remit such amounts
to the Collateral Agent and the Collateral Agent shall redistribute such amounts
to the Lenders on the same basis as such amounts were originally distributed.
The obligations of the Lenders and the Collateral Agent under this Section 4.6
shall survive the repayment of the Secured Obligations and termination of the
Bank Agreement and the Note Agreements.
4.7. RECEIVING LENDER TO THE SUBROGATED TO RIGHTS OF OTHER LENDERS.
Any Receiving Lender that has remitted any portion of a Shared Payment
received by it to the Collateral Agent as provided in Section 4.5 shall, to the
extent of such remittance distributed or distributable to the other Lenders, be
subrogated to the rights of each of such other Lenders to receive payments from
the Company applicable to the Secured Obligations owed to such other Lenders,
until all Secured Obligations owed to such Receiving Lender shall be paid in
full, and for purposes of such subrogation, no such payment received by such
other Lenders shall, as between the Company, its creditors other than the
holders of any Secured Obligations, and the holders of any Secured Obligations,
be deemed to be a payment by the Company to such other Lenders or on account of
their Secured Obligations, it being understood that the provisions of this
Section 4.7 are, and are intended, solely for the purpose of defining the
relative rights of the holders of the Secured Obligations.
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5. COLLATERAL AGENT
5.1. DISTRIBUTIONS AND CONSENTS.
In making the distributions to the Lenders provided for in Section 4, the
Collateral Agent may rely upon information available to it or supplied by each
Lender to it with respect to the amount of Secured Obligations owing to each
Lender, and the Collateral Agent shall have no liability to any Lender for
actions taken in reliance on such information in the absence of its gross
negligence or willful misconduct. Each of the Lenders hereby agrees, on two
business days' telephonic, telecopy or similar notice from the Collateral Agent,
to confirm to the Collateral Agent in writing, including by telecopy of a signed
confirmation, the outstanding balance of the Secured Obligations, if any (and,
if requested by the Collateral Agent, itemized as to principal, interest, fees,
Make-Whole Amount, premiums and other amounts, if any), owing to such Lender as
of the date or dates specified in such notice.
5.2. EXERCISE OF RIGHTS.
(a) Subject to clause (c) of this Section 5.2, so long as an Event
of Default shall be continuing, the Collateral Agent shall not, without
the written consent of either the Requisite Banks or the Requisite
Noteholders, exercise any of the rights and remedies of a secured party
under the Uniform Commercial Code of any applicable jurisdiction or any
other applicable law, including, without limitation, by suits or
proceedings in equity, at law, in bankruptcy or otherwise, and whether for
the specific performance of any covenant or agreement herein contained or
in execution or aid of any power herein granted, or for foreclosure
hereunder, or for the appointment of a receiver or receivers for the
Collateral or any part thereof, or for the enforcement of any other
proper, legal or equitable remedy available under applicable law. Without
limitation of the foregoing and subject to clause (b) and clause (c) of
this Section 5.2, so long as an Event of Default shall be continuing, the
Collateral Agent shall, upon the written direction of either the Requisite
Banks or the Requisite Noteholders, take any and all actions and exercise
any and all rights, remedies and options which it may have under the
Collateral Documents or applicable law to sell or otherwise realize upon
the Collateral or any portion thereof and the Lenders shall promptly
execute any and all release documents as may be requested by the
Collateral Agent in connection with any such sale or realization. No
provision of this Agreement shall be deemed to authorize the Collateral
Agent to authorize or consent to or accept or adopt on behalf of any
Lender any plan of reorganization, arrangement, adjustment or composition
affecting the Noteholder Secured Obligations or the Bank Secured
Obligations, to exercise the right of any Lender in respect thereof, or to
vote in respect of the claim of any Lender in any such proceeding.
(b) Subject to clause (c) of this Section 5.2, so long as an Event
of Default shall be continuing, either the Requisite Banks or the
Requisite Noteholders, by an instrument or instruments in writing executed
and delivered to the Collateral Agent and providing for indemnity pursuant
to Section 5.3, may direct, and at all times shall have the right to so
direct, the timing, method, manner, place, price and all other aspects of
realizing on the Collateral and conducting the proceedings to be taken in
connection with the enforcement of the terms and conditions hereof,
provided that such direction shall not be otherwise than in accordance
with the provisions of applicable law or of any of the other
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Collateral Documents, as the case may be, in which case the Collateral
Agent shall proceed in accordance with such direction.
(c) Notwithstanding the provisions set forth in clause (a) and
clause (b) of this Section 5.2, for a period of sixty days after a Lender
shall have given a Notice of Default as provided in Section 4.3, the
Collateral Agent shall not be permitted to take any of the actions set
forth in clause (a) or clause (b) of this Section 5.2, unless directed to
do so by the Requisite Lenders, provided that, at any time after a Lender
shall have given a Notice of Default as provided in Section 4.3, and one
or more of the Events of Default specified in such Notice of Default is
based upon clause (a), (b), (f), (g), (h) or (i) of Section 9.1 of the
Bank Agreement or clause (a), (b), (f), (g), (h) or (i) of Section 11 of
the Note Agreements, the Collateral Agent, at the direction of either the
Requisite Banks or the Requisite Noteholders, shall notify the Company to,
and the Company shall (i) establish a lock-box at the principal office of
the Collateral Agent effective as of the 30th day after such Notice of
Default shall have been given (or effective immediately if such 30th day
shall have passed prior to the giving of such direction) and (ii) instruct
all of the Company's account debtors to send payments to such lock-box;
provided, however that such lock-box shall be established and such notice
shall be given immediately upon the direction of the Requisite Lenders.
The Collateral Agent shall deposit funds in the lockbox, on a daily basis,
into a cash collateral account maintained at the principal office of the
Collateral Agent. All amounts transmitted to the lock-box or deposited in
the cash collateral account shall be held by the Collateral Agent for the
benefit of the Lenders, as set forth in this Agreement.
(d) Subject to clause (e) of this Section 5.2, no Lender shall
commence, join in or participate in any way or cause any other Person to
commence, join in or participate in any way in the exercise of any rights,
remedies or options which it may have under the Collateral Documents or
applicable law to sell or otherwise realize upon the Collateral or any
portion thereof except with the prior written consent of the Requisite
Lenders.
(e) The Lenders shall not interfere with, or invoke or utilize any
applicable law that might prevent, cause a delay in, or impede the
performance or enforcement of any right of the Collateral Agent with
respect to the Collateral. The Lenders further agree that they shall not
at any time take any action or exercise any right, at law, in equity or
otherwise, so as to disturb, infringe upon, prevent or impede or otherwise
interfere with the Collateral Agent's full, complete, free and unfettered
enjoyment of its right of access to any and all of the Collateral. Nothing
in this clause (e) or in any other provision of this Agreement shall
affect or impair the right of action, which is absolute and unconditional,
of each Lender
(i) to accelerate any indebtedness owing to such Lender under
the Bank Agreement or a Note Agreement, as applicable, following a
default, or to institute suit to enforce the payment of the
Noteholder Secured Obligations or the Bank Secured Obligations, as
applicable, due and payable to such Lender,
(ii) to institute suit for any alleged breach of this
Agreement, or
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(iii) to vote against, or take any other action in opposition
to, any proposed plan of reorganization in a Reorganization.
5.3. LIABILITY; INDEMNIFICATION.
The Collateral Agent shall have no duties to the Lenders under this
Agreement except those expressly set forth herein. Neither the Collateral Agent
nor any of its officers, directors, employees or agents shall be liable to any
Lender for any action taken or omitted by it or them hereunder or in connection
herewith, unless caused by its or their gross negligence or willful misconduct.
Each of the Lenders hereby indemnifies the Collateral Agent pro rata (based upon
the principal amount permitted to be outstanding under the Note Agreements and
the Bank Agreement) from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by, or asserted against the Collateral Agent in any way relating to or arising
out of this Agreement or any action taken or omitted by the Collateral Agent in
such capacity under this Agreement; provided that no party shall be liable for
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
Collateral Agent's gross negligence or willful misconduct. The foregoing
indemnity shall survive payment of the Secured Obligations and termination of
this Agreement. Without limiting the foregoing, each Lender agrees to reimburse
the Collateral Agent for its pro rata share (as determined above) of all costs
and expenses incurred by the Collateral Agent on behalf of the Lenders to the
extent such costs and expenses are not reimbursed by the Company.
5.4. RESIGNATION OR REMOVAL OF COLLATERAL AGENT.
The Collateral Agent may resign and be discharged of its duties hereunder
by giving written notice thereof to all holders of the Secured Obligations then
outstanding. Such resignation shall take effect at the earlier of (a) thirty
days after receipt of such written notice by each holder of the Secured
Obligations and (b) the appointment of a successor collateral agent hereunder.
The Collateral Agent may be removed at any time with or without cause by the
Requisite Lenders. Upon any such resignation or removal, the Requisite
Noteholders shall have the right to appoint a successor collateral agent. Upon
the acceptance of any appointment as collateral agent hereunder by a successor
collateral agent, such successor collateral agent shall thereupon succeed to and
become vested with all of the rights, powers, privileges and duties of the
retiring Collateral Agent. After any retiring Collateral Agent's resignation or
removal hereunder as Collateral Agent, the provisions of this Section 5.4 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Collateral Agent.
5.5. EMPLOYMENT OF AGENTS AND COUNSEL.
The Collateral Agent may execute any of its duties as Collateral Agent
hereunder by or through employees, agents and attorneys-in-fact and shall not be
answerable to the Lenders, except as to money or securities received by it or
its authorized agents, for the default or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. The Collateral Agent
shall be entitled to advice of counsel concerning all matters pertaining to the
agency hereby created and its duties hereunder.
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5.6. RELIANCE ON DOCUMENTS; COUNSEL.
The Collateral Agent shall be entitled to rely upon any notice, consent,
certificate, affidavit, letter, telegram, statement, paper or document believed
by it to be genuine and correct and to have been signed or sent by the proper
Person or Persons, and, with respect to legal matters, upon the opinion of
counsel selected by the Collateral Agent, which counsel may be an employee of
the Collateral Agent.
5.7. COMPANY'S REIMBURSEMENT AND INDEMNIFICATION OBLIGATIONS.
The Company hereby indemnifies the Collateral Agent, and shall immediately
reimburse the Collateral Agent, for expenses incurred by the Collateral Agent on
behalf of the Lenders, in connection with the execution, delivery,
administration and enforcement of this Agreement and for any liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind and nature whatsoever which may be imposed
on, incurred by or asserted against the Collateral Agent in any way relating to
or arising out of this Agreement or any other document delivered in connection
herewith or the transactions contemplated hereby, or the enforcement of any of
the terms hereof, provided that the Company shall not be liable for any of the
foregoing to the extent they arise from the gross negligence or willful
misconduct of the Collateral Agent. The obligations of the Company under this
Section 6.7 shall survive payment of the Secured Obligations and termination of
this Agreement.
5.8. RIGHTS AS LENDER.
In the event the Collateral Agent, in its individual capacity, is a
Lender, the Collateral Agent shall have the same rights and powers hereunder in
such capacity as any Lender and may exercise the same as though it were not the
Collateral Agent, and the term "Lender" or "Lenders" shall, at any time when the
Collateral Agent is a Lender, unless the context otherwise indicates, include
the Collateral Agent in its individual capacity, The Collateral Agent in its
individual capacity. The Collateral Agent in its individual capacity may accept
deposits from, land money to, and generally engage in any kind of trust, debt,
equity or other transaction, in addition to those contemplated by this
Agreement, with the Company or any of its subsidiaries in which the Company or
such subsidiary is permitted to participate with any other Person. The
Collateral Agent, in its individual capacity, is not obligated to be a Lender.
6. MISCELLANEOUS
6.1. GOVERNING LAW.
THIS AGREEMENT SHALL BE CONSTRUED, INTERPRETED AND ENFORCED IN ACCORDANCE
WITH, AND GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF NEW YORK.
6.2. LENDER CREDIT DECISION.
Each Lender acknowledges that it has, independently and without reliance
upon any other Lender and based on the financial statements prepared by Company
and such other documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without
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reliance upon any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement.
6.3. AMENDMENTS TO THIS AGREEMENT.
This agreement may be amended only in a writing executed by all of the
parties hereto (or their respective successors and assigns).
6.4. AMENDMENTS TO OTHER DOCUMENTS.
The Noteholders and the Banks may amend, modify, compromise, extend or
otherwise change the provisions of the Note Agreements and the Bank Agreement,
respectively, and may grant waivers of any covenants or provisions of their
respective documents; provided, however, that
(a) no Collateral Document shall be amended, modified, compromised
or otherwise changed, and no waivers of any covenants or provisions
thereof shall be granted, without the consent of the Requisite Lenders and
(b) the Banks shall not increase the principal amount committed as
of the date hereof under the Bank Agreement, and the Noteholders shall not
increase the principal amount outstanding as of the date hereof under the
Note Agreements, without the prior written consent of the Requisite
Lenders.
Promptly after any such amendment, modification, compromise, extension, other
change or waiver, each Lender shall give written notice thereof to the other
Parties hereto as set forth in Section 6.10; provided, however, that the failure
of the other Lenders or the Facility Agent to receive such notice shall not
affect the validity of the action taken.
6.5. COUNTERPARTS.
This Agreement may be executed in several counterparts, each of which
shall be deemed an original (whether delivered in original form or by telecopy)
but all of which shall constitute one agreement, and shall constitute a binding
agreement when executed by each of the parties hereto.
6.6. SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon and inure to the benefit of the
successors and assigns of the parties hereto including any assignees of the
Secured Obligations. Each Lender agrees that it will not assign any of the
Secured Obligations absent an acknowledgment by the assignee thereof of the
terms of this Agreement, provided that the failure of any Lender to obtain such
acknowledgement shall not affect the effectiveness of the immediately preceding
sentence.
6.7. TERMINATION.
This Agreement shall terminate upon the payment in full of all Secured
Obligations and the termination of the Bank Agreement and the Note Agreements.
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6.8. COOPERATION.
Each party hereto agrees to cooperate fully with the other parties hereto,
in the exercise of its reasonable judgment, to the end that the terms and
provisions of this Agreement may be promptly and fully carried out. Each party
hereto also agrees, from time to time, to execute and deliver any and all other
agreements, documents or instruments and to take such other actions, all as may
be reasonably necessary or desirable to effectuate the terms, provisions and the
intent of this Agreement.
6.9. NO WAIVER.
No failure or delay on the part of any Lender in exercising any right,
power or remedy hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or remedy preclude any other
or further exercise thereof or the exorcise of any other right, power or remedy
hereunder.
6.10. NOTICES.
All written communications provided for hereunder shall be sent by
national overnight delivery service, with charges prepaid and (i) if to any
Noteholder, addressed to such Noteholder at the address specified in Annex 1
hereto, or at such other address as such Noteholder shall have specified to the
other Noteholders and the Facility Agent in writing, (ii) if to any Bank or the
Facility Agent, addressed to the Facility Agent (and the Facility Agent shall
forward a copy of each such communication to the Banks) at the address specified
in Annex 1 hereto, or at such other address as the Facility Agent shall have
specified to the Noteholders and (iii) if to the Collateral Agent, addressed to
the Collateral Agent at the address specified in Annex 1 hereto, or at such
other address as the Collateral Agent shall have specified to the Noteholders
and the Facility Agent
6.11. THIRD PARTY BENEFICIARIES.
No Person (including, without limitation, the Company) other than the
Lenders, the Facility Agent and the Collateral Agent and their respective
successors and assigns, shall have any rights under this Agreement.
[REMAINDER OF PAGE INTENTIONALLY BLANK. NEXT PAGE IS SIGNATURE PAGE.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first written above.
NOTEHOLDERS:
PRINCIPAL MUTUAL LIFE INSURANCE
COMPANY
By /s/ XXXXX X. XXXXX
-----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Counsel
By /s/ XXXXXX XXXXX
-----------------------------------------
Name: Xxxxxx Xxxxx
Title: Assistant Director
Investment Securities
NIPPON LIFE INSURANCE COMPANY OF
AMERICA,
an Iowa corporation, by its attorney in
fact,Principal Mutual Life Insurance
Company, an Iowa corporation
By /s/ XXXXX X. XXXXX
-----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Counsel
By /s/ XXXXXX XXXXX
-----------------------------------------
Name: Xxxxxx Xxxxx
Title: Assistant Director
Investment Securities
[SIGNATURE PAGE TO COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT]
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BANKS:
BANK ONE, TEXAS, N.A., AS A BANK
By /s/ XXXXXXX X. XXXXXXX
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
AGENT:
BANK ONE, TEXAS, N.A.,
AS FACILITY AGENT AND COLLATERAL AGENT
By /s/ XXXXXXX X. XXXXXXX
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
[SIGNATURE PAGE TO COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT]
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AGREED AND ACKNOWLEDGED:
HYDRIL COMPANY
By /s/ XXXXXXXXXXX X. XXXXXX
------------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxx
Title: President and Chief Executive Officer
[SIGNATURE PAGE TO COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT]
16
ANNEX I
ADDRESSES FOR NOTICES
NOTEHOLDERS:
Principal Mutual Life Insurance Company
000 Xxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000-0000
Attention: Investment Department - Securities
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Nippon Life Insurance Company of America
c/o Principal Mutual Life Insurance Company
000 Xxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000-0000
Attention: Investment Department - Securities
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
FACILITY AGENT:
Bank One, Texas, N.A,
000 Xxxxxx
0xx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
COLLATERAL AGENT:
Bank One, Texas, N.A.
000 Xxxxxx
0xx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Schedule A-1
17
SCHEDULE A
COLLATERAL DOCUMENTS
1. Security Agreement, dated as of March 23,1998, between the Company and
Chase Bank of Texas, National Association.
2. Deed of Trust and Security Agreement from the Company to Xxxxx X Xxxxxx,
trustee for the benefit of Chase Bank of Texas, National Association,
dated as of March 23, 1998, with respect to certain real property located
in Los Angeles County, California, as amended by a Modification to Deed of
Trust and Extension Agreement, dated as of June 25,1998.
3. Chicago Title Insurance Company, policy number 008135152, issued April
14,1998 in the amount of $5,000,000, with respect to the real property
described in item #2.
4. Deed of Trust and Security Agreement from the Company to Xxxxx X Xxxxxx,
trustee for the benefit of Chase Bank of Texas, National Association,
dated as of March 23, 1998, with respect to certain real property located
in Xxxxxx County, Texas, as amended by a Modification to Deed of Trust and
Extension Agreement, dated as of June 25, 1998.
5. Lawyers Title Insurance Company, policy number 9100-624208, issued April
9, 1998 in the amount of $13,000,000, with respect to the real property
described in item #4.
6. Pledge, dated as of March 23, 1998, between the Company and Chase Bank of
Texas, National Association, together with the stock certificates and
stock powers in respect of the pledged securities covered by such Pledge.
7. The following UCC-1 financing statements, naming the Company as debtor and
Chase Bank of Texas, National Association as secured party:
Jurisdiction Filing Information
------------ ------------------
Xxxxxx County Clerk,
Xxxxxx County, Texas No. S956126, filed 4/9/98
Los Angeles County Clerk,
Los Angeles County, California No. 98-876324, filed 5/26/98
Department of Natural Resources, Alaska No. 445487, filed 4/14/98
Secretary of State of California No. 9810360861, filed 4/13/98
East Baton Rouge Clerk of Court,
East Baton Rouge Parish, Louisiana No. 17-1148101, filed 4/13/98
Oklahoma County Xxxxx (Central Filing),
Oklahoma County, Oklahoma No. NO2916, filed 4/13/98
Secretary of State of Texas No. 98-074774, filed 4/13/98
Secretary of State of Wyoming No. 98 103151A04, filed 4/13/98
Xxxxxxx Xxxxxx Xxxxx, Xxxxxxx Xxxxxx,
Xxxxxxx Xx. X000000, filed 4/14/98
Schedule X-0
00
0. Second Lien Deed of Trust and Security Agreement from the Company to
Xxxxxxxxxxx X. Xxxxxx, trustee for the benefit of Bank One, Texas,
N.A., dated as of June 25, 1998, with respect to certain real property
located in Los Angeles County, California.
9. Second Lien Deed of Trust and Security Agreement from the Company to
Xxxxxxxxxxx X. Xxxxxx, trustee for the benefit of Bank One, Texas,
N.A., dated as of June 25, 1998, with respect to certain real property
located in Xxxxxx County, Texas.
10. The following UCC-3 financing statements, naming Bank One, Texas, N.A.,
as assignee of the secured party (Chase Bank of Texas, National
Association):
Jurisdiction Filing Information
------------ ------------------
Xxxxxx County Clerk,
Xxxxxx County, Texas
Los Angeles County Xxxxx,
Los Angeles County, California
Department of Natural Resources, Alaska
Secretary of State of California
East Baton Rouge Clerk of Court,
East Baton Rouge Parish, Louisiana
Oklahoma County Clerk (Central Filing),
Oklahoma County, Oklahoma
Secretary of State of Texas
Secretary of State of Wyoming
Natrona County Clerk, Natrona County,
Wyoming
11. Master Ratification, Security and Pledge Agreement, dated as of June 25,
1998, between the Company and the Collateral Agent.
12. Environmental Risk Agreement, dated as of June 25, 1998, by the Company.
13. Insurance Requirements Agreement, dated as of June 25, 1998, by the
Company.
Schedule A-3
