Exhibit 10.2
SECURITY AGREEMENT
This SECURITY AGREEMENT (the "Agreement"), dated as of September 1, 1998,
made by the DOE RUN RESOURCES CORPORATION, a New York corporation, having an
office at 0000 Xxxx 000 Xxxxx, Xx Xxxxx, Xxxxxxxx 00000 (the "Pledgor"), in
favor of STATE STREET BANK AND TRUST COMPANY, having an office at Xxxxxxx
Square, 225 Asylum, 00xx Xxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, Attention:
Corporate Trust Administration, as trustee and collateral agent (in such
capacity and together with any successors in such capacity, the "Collateral
Agent") pursuant to the Indenture (as hereinafter defined).
R E C I T A L S:
A. Pledgor and Collateral Agent, as trustee, have entered into a certain
indenture (as amended from time to time, the "Indenture"; capitalized terms
used herein and not defined shall have the meaning assigned to them in the
Indenture), dated as of the date hereof, pursuant to which Pledgor has issued
11 1/4% Senior Secured Notes due 2005, Series A and, may issue, in exchange
therefore, on a dollar for dollar basis, 11 1/4% Senior Secured Notes due
2005, Series B (collectively, the "Notes") in the aggregate principal amount
of $50,000,000.
B. Pledgor is the owner of the Pledged Collateral (as hereinafter
defined).
C. Pledgor is executing and delivering this Agreement to grant to the
Collateral Agent for its benefit and the benefit of the Holders (collectively,
the "Secured Parties") liens of the character and priority contemplated
herein on the Pledged Collateral to secure the payment and performance of
Secured Obligations (as defined in Section 2).
A G R E E M E N T:
NOW, THEREFORE, in consideration of the foregoing premises and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Pledgor and Collateral Agent hereby agree as follows:
Section 1. Pledge. As collateral security for the payment and performance
when due of all the Secured Obligations, Pledgor hereby pledges, assigns,
transfers and grants to Collateral Agent for its benefit and the benefit of
the Secured Parties, a continuing security interest in and to all of the
right, title and interest of Pledgor in, to and under the following property,
whether now owned or hereafter acquired
(collectively, the "Pledged Collateral"), securing the obligations of Pledgor
in respect of the Notes:
(a) all machinery, apparatus, equipment, fittings, fixtures, improvements
and articles of personal property of every kind and nature identified on
Schedule A hereto, including, without limitation, manufacturing equipment,
storage and handling equipment, automotive equipment, rolling stock,
overhead cranes, warehouses, tools, utility systems, fire sprinkler and
alarm systems, HVAC equipment, boiler, electronic monitoring, water or
lighting systems, power, sanitation, waste removal, window cleaning,
maintenance or other systems or equipment, all indoor or outdoor furniture,
appliances or supplies used or useful in connection with the use, operation,
maintenance or repair of any part of the premises located at the locations,
all of the foregoing as identified on Schedule A, all modifications,
alterations, repairs, additions and accessions thereto and parts therefor,
and all Proceeds (as defined under the Uniform Commercial Code as in effect
in any relevant jurisdiction, the "Code") constituting replacements and
substitutions therefor up to an amount not in excess of the fair market
value of such Equipment being substituted or replaced (collectively, the
"Equipment"); and
(b) all funds from time to time on deposit in the Collateral Account;
all investments of such funds and all certificates and instruments from time
to time representing or evidencing such investments; all notes, certificates
of deposit, checks and other instruments from time to time hereafter
delivered to or otherwise possessed by Collateral Agent for or on behalf
of Pledgor in substitution for or in addition to any or all of the Pledged
Collateral described above; and all interest, dividends, cash, instruments
and other property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the items
described above;
(c) all Proceeds of any of the foregoing, and in any event, including,
without limitation, any and all (i) proceeds of any insurance (except
proceeds of business interruption insurance or payments made to a Person
that is not a party to this Agreement), indemnity, warranty or guarantee
payable to Collateral Agent or to Pledgor from time to time with respect
to any of the Pledged Collateral, (ii) payments (in any
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form whatsoever) made or due and payable to Pledgor from time to time in
connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any part of the Pledged Collateral by any governmental
authority (or any person acting under color of a governmental authority),
(iii) products of the Pledged Collateral and (iv) other amounts from time
to time paid or payable under or in connection with any of the Pledged
Collateral.
Notwithstanding the foregoing, the Pledged Collateral shall not include
(i) "Collateral" as defined in the U.S. Revolving Credit Agreement as in
effect on the Issue Date and whether or not such U.S. Revolving Credit
Agreement remains in effect, (ii) Excluded Assets or (iii) items of personal
property hereafter acquired by Mortgagor in accordance with Section 4.12 of
the Indenture for so long as such items of personal property are subject to
any Capitalized Lease Obligation, Lien or security interest; provided that
upon the release of any Capitalized Lease Obligation, Lien or security
interest affecting any such item of personal property, such item of personal
property shall constitute Pledged Collateral hereunder.
Section 2. Secured Obligations. This Agreement secures, and the Pledged
Collateral is collateral security for, the payment and performance in full
when due, whether at stated maturity, by acceleration or otherwise
(including, without limitation, the payment of interest and other amounts
which would accrue and become due but for the filing of a petition in
bankruptcy or the operation of the automatic stay under Section 362(a) of the
Bankruptcy Code, 11 U.S.C. Section 362(a)), of (i) all Obligations of
Pledgor now existing or hereafter arising under or in respect of the
Indenture and the Notes (including, without limitation, Pledgor's obligations
to pay principal of, premium if any, and interest on the Notes), (ii) all
Obligations of Pledgor now existing or hereafter arising under or in respect
of this Agreement and other Collateral Documents and (iii) all interest,
charges, fees, costs, expenses, reimbursements, premiums, indemnities or
other payments of any kind or nature which are owed in respect of amounts or
instruments referred to in any of clauses (i) and (ii) above (the obligations
described in clauses (i) through (iii), collectively, the "Secured
Obligations").
Section 3. No Release. Nothing set forth in this Agreement shall relieve
Pledgor from the performance of any term, covenant, condition or agreement on
Pledgor's part to be performed or observed under or in respect of any of the
Pledged Collateral or from any liability to any Person under or in respect of
any of the Pledged Collateral or shall impose any ob-
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ligation on Collateral Agent or any Secured Party to perform or observe any
such term, covenant, condition or agreement on Pledgor's part to be so
performed or observed or shall impose any liability on Collateral Agent or
any Secured Party for any act or omission on the part of Pledgor relating
thereto or for any breach of any representation or warranty on the part of
Pledgor contained in this Agreement, or under or in respect of the Pledged
Collateral or made in connection herewith or therewith. The obligations of
Pledgor contained in this Section 3 shall survive the termination of this
Agreement and the discharge of Pledgor's other obligations under this
Agreement.
Section 4. Supplements; Further Assurances.
(a) Pledgor agrees that it will execute and, at its sole cost and expense,
file and refile, and permit Collateral Agent to file and refile, such
financing statements, continuation statements and other documents (including,
without limitation, this Agreement), in such offices as Collateral Agent
may reasonably request, wherever required or permitted by law in order to
perfect and preserve the rights and interests granted to Collateral Agent
hereunder.
(b) Pledgor hereby authorizes Collateral Agent to file financing
statements, continuation statements and other documents relative to all or
any part thereof, without the signature of Pledgor where permitted by law,
and Pledgor agrees to do such further acts and things, and to execute and
deliver to Collateral Agent such additional assignments, agreements, powers
and instruments, as Collateral Agent may reasonably request to carry into
effect the purposes of this Agreement or better to assure and confirm unto
Collateral Agent its respective rights, powers and remedies hereunder.
Pledgor shall, upon the request of Collateral Agent, and hereby authorizes
Collateral Agent to, take any and all such actions as Collateral Agent may
reasonably request to perfect and preserve the rights and interests granted
to Collateral Agent with respect to the Pledged Collateral wherever located.
All of the foregoing shall be at the sole cost and expense of Pledgor.
Section 5. Representations, Warranties and Covenants. Pledgor represents,
warrants and covenants as follows:
(a) Necessary Filings. All filings, registrations and recordings
necessary, appropriate or requested by Collateral Agent to create,
preserve, protect and perfect the security interest granted by Pledgor to
Collateral Agent hereby in respect of the Pledged Collateral have been
accomplished (except to the extent that separate filings are required under
motor vehicle lien laws). The security
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interest granted to Collateral Agent for the benefit of the Secured Parties
pursuant to this Agreement in and to the Pledged Collateral constitutes
and hereafter will constitute a first priority perfected Lien, pledge and
security interest therein, superior and prior to the rights of all other
Persons therein and subject to no other Liens.
(b) No Liens. Pledgor is as of the date hereof, and, as to Pledged
Collateral acquired by it from time to time after the date hereof, Pledgor
will be, the owner of all Pledged Collateral free from any Lien or other
right, title or interest of any Person other than the Lien and security
interest granted by Pledgor to Collateral Agent pursuant to this Agreement
and Pledgor shall defend the Pledged Collateral against all claims and
demands of all Persons at any time claiming any interest therein adverse
to Collateral Agent or any Secured Party.
(c) Other Financing Statements. There is no financing statement (or
similar statement or instrument of registration under the law of any
jurisdiction) covering or purporting to cover any interest of any kind in
the Pledged Collateral and so long as any of the Secured Obligations
remain unpaid, Pledgor shall not execute or authorize to be filed in any
public office any financing statement (or similar statement or instrument
of registration under the law of any jurisdiction) or statements relating
to the Pledged Collateral, except financing statements filed or to be
filed in respect of and covering the security interest granted by Pledgor
to Collateral Agent pursuant to this Agreement and the other Collateral
Documents.
(d) Chief Executive Office; Records. The chief executive office of
Pledgor is located at 0000 Xxxx 000 Xxxxx, Xx. Xxxxx, Xxxxxxxx 00000.
Pledgor shall not move its chief executive office, except to such new
location as Pledgor may establish in accordance with the last sentence of
this Section 5(d). Pledgor shall not establish a new location for its
chief executive office nor shall it change its name until (i) it shall
have given Collateral Agent not less than 30 days' prior written notice of
its intention so to do, clearly describing such new location or name and
providing such other information in connection therewith as Collateral
Agent may reasonably request, and (ii) with respect to such new location
or name, Pledgor shall have taken all action reasonably necessary to
maintain the perfection and proof of the security interest of Collateral
Agent for the benefit of the Secured Parties in the Pledged Collateral
intended to be granted hereby, in-
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cluding, without limitation, using best efforts to obtain waivers of
landlord's or warehouseman's liens with respect to such new location.
(e) Location of Equipment. All Equipment held on the date hereof by
Pledgor is located at one of the locations shown on Schedule A hereto. All
Equipment now held or subsequently acquired in substitution or replacement
therefor shall be kept at one of the locations shown on Schedule A hereto, or
such new location as Pledgor may establish if (i) it shall have given to
Collateral Agent at least 30 days' prior written notice of its intention so
to do, clearly describing such new location and providing such other
information in connection therewith as Collateral Agent may reasonably
request, and (ii) with respect to such new location, Pledgor shall have taken
all action necessary to maintain the perfection and proof of the security
interest of Collateral Agent for the benefit of the Secured Parties in the
Pledge Collateral intended to be granted hereby, including, without
limitation, using best efforts to obtain waivers of landlord's or
warehouseman's liens with respect to such new location.
(f) Authorization, Enforceability. Pledgor has full corporate power,
authority and legal right to pledge and grant the security interest in all
the Pledged Collateral pursuant to this Agreement, and this Agreement
constitutes the legal, valid and binding obligation of Pledgor, enforceable
against Pledgor in accordance with its terms.
(g) No Consents, etc. No consent of any party, other than the lender
under the U.S. Revolving Credit Facility (including, without limitation,
stockholders or creditors of Pledgor), and no consent, authorization,
approval, or other action by, and no notice to or filing with, any
Governmental Authority or regulatory body or other Person is required either
(x) for the pledge by Pledgor of the Pledged Collateral pursuant to this
Agreement or for the execution, delivery or performance of this Agreement by
Pledgor, or (y) for the exercise by Collateral Agent of the rights provided
for in this Agreement, or (z) for the exercise by Collateral Agent of the
remedies in respect of the Pledged Collateral pursuant to this Agreement.
(h) Pledged Collateral. All information set forth herein relating to
the Pledged Collateral is accurate and complete in all respects.
Section 6. Provisions Concerning Pledged Collateral.
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(a) Protection of Collateral Agent's Security.
Pledgor shall not take any action that impairs the rights of Collateral Agent
or any Secured Party in the Pledged Collateral. Pledgor shall at all times
keep the Equipment insured in favor of Collateral Agent, at Pledgor's own
expense, to Collateral Agent's reasonable satisfaction against fire, theft
and all other risks to which the Pledged Collateral may be subject, in such
amounts and with such deductibles as would be maintained by operators of
businesses similar to the business of Pledgor or as Collateral Agent may
otherwise require. Pledgor may self-insure in reasonable amounts. Each policy
or certificate with respect to such insurance shall be endorsed for the
benefit of Collateral Agent (including, without limitation, by naming
Collateral Agent as an additional named insured and/or loss payee, as
applicable, as Collateral Agent may request) and such policy or certificate
shall be delivered to Collateral Agent. Each such policy shall state that it
cannot be canceled without 30 days' prior written notice to Collateral Agent.
At least 30 days prior to the expiration of any such policy of insurance,
Pledgor shall deliver to Collateral Agent an extension or renewal policy or
an insurance certificate evidencing renewal or extension of such policy. If
Pledgor shall fail to insure such Pledged Collateral or if Pledgor shall fail
to so endorse and deposit, or to extend or renew, all such insurance policies
or certificates with respect thereto, Collateral Agent shall have the right
(but shall be under no obligation) to advance funds to procure or renew or
extend such insurance and Pledgor agrees to reimburse Collateral Agent for
all costs and expenses thereof, with interest on all such funds from the date
advanced at the highest rate then in effect under the Indenture.
(b) Pledgor acknowledges that any proceeds of insurance in respect of the
Pledged Collateral are hereby assigned to Collateral Agent. In case of any
loss or damage to any of the Pledged Collateral, all proceeds of insurance
maintained by Pledgor shall be paid to Collateral Agent as Trust Moneys
pursuant to Article 11 of the Indenture and shall be subject to retention and
disbursement by Collateral Agent in accordance with the terms of the
Indenture.
(c) Maintenance of Equipment. Pledgor shall cause the Equipment to be
maintained and preserved in the same condition, repair and working order as
when new, ordinary wear and tear excepted, and to the extent consistent with
current business practice in accordance with any manufacturer's manual, and
shall forthwith, or in the case of any loss or damage which (individually or
in the aggregate) exceeds $100,000 to any of the Equipment (of which prompt
notice shall be given to Collateral Agent) as quickly as practicable after
the occurrence
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thereof, make or cause to be made all repairs, replacements and other
improvements in connection therewith which are necessary or desirable to such
end.
(d) Payment of Taxes; Claims. Pledgor shall pay promptly when due all
property and other taxes, assessments and governmental charges or levies
imposed upon, and all claims (including claims for labor, materials and
supplies) against, the Pledged Collateral. Notwithstanding the foregoing,
Pledgor may at its own expense contest the amount or applicability of any
such taxes, assessments, governmental charges or levies by appropriate legal
proceedings; provided, that (i) any such contest shall be conducted in good
faith by appropriate proceedings promptly instituted and diligently conducted
and (ii) in connection with such contest, Pledgor shall have made provision
for the payment of such contested amount on Pledgor's books if and to the
extent required by generally accepted accounting principles then used by
Pledgor in the preparation of its financial statements or deposited with
Collateral Agent a sum sufficient to pay and discharge such obligation and
Collateral Agent's estimate of all interest and penalties related thereto.
(e) Further Actions. Pledgor shall, at its sole cost and expense, make,
execute, endorse, acknowledge, file and/or deliver to Collateral Agent from
time to time such lists, descriptions and designations of the Pledged
Collateral, copies of warehouse receipts, receipts in the nature of warehouse
receipts, bills of lading, documents of title, vouchers, invoices, schedules,
confirmatory assignments, supplements, additional security agreements,
conveyances, financing statements, transfer endorsements, powers of
attorney, certificates, reports and other assurances or instruments and take
such further steps relating to the Pledged Collateral and other property or
rights covered by the security interest hereby granted, which is appropriate
or advisable to exercise and enforce its rights and remedies hereunder with
respect to any Pledged Collateral and to perfect, preserve or protect the
security interest in the Pledged Collateral created by this Agreement.
(f) Financing Statements. Pledgor shall sign and deliver to collateral
Agent such financing and continuation statements, in form acceptable to
Collateral Agent, as may from time to time be required to continue and
maintain a valid, enforceable, security interest in the Pledged Collateral
having the priority provided herein and the other rights, as against third
parties, provided hereby, all in accordance with the Code or any other
relevant law. Pledgor shall pay any applicable filing fees and other expenses
related to the filing of such financing and continuation statements. Pledgor
authorizes Collateral
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Agent to file any such financing or continuation statements without the
signature of Pledgor where permitted by law.
Section 7. Transfers and Other Liens. Except in accordance with the
Indenture, Pledgor shall not (i) sell, convey, assign or otherwise dispose
of, or grant any option with respect to, any of the Pledged Collateral or (ii)
create or permit to exist any Lien upon or with respect to any of the Pledged
Collateral other than the Lien and security interest granted to Collateral
Agent under this Agreement.
Section 8. Reasonable Care. Collateral Agent shall be deemed to have
exercised reasonable care in the custody and preservation of the Pledged
Collateral in its possession if such Pledged Collateral is accorded treatment
substantially equivalent to that which Collateral Agent, in its individual
capacity, accords its own property, it being understood that Collateral Agent
shall not have responsibility for taking any necessary steps to preserve
rights against any Person with respect to any Pledged Collateral.
Section 9. Remedies Upon Default; Obtaining the Pledged Collateral Upon
Event of Default. (a) If an Event of Default shall have occurred and be
continuing, then and in every such case, Collateral Agent shall, in
accordance with the terms of and at the times specified in the Indenture:
(i) Personally, or by agents or attorneys, immediately take
possession of the Pledged Collateral or any part thereof, from Pledgor or
any other Person who then has possession of any part thereof with or without
notice or process of law, and for that purpose may enter upon Pledgor's
premises where any of the Pledged Collateral is located and remove such
Pledged Collateral and use in connection with such removal any and all
services, supplies, aids and other facilities of Pledgor.
(ii) Sell, assign or otherwise liquidate, or direct Pledgor to sell,
assign or otherwise liquidate, any or all investments made in whole or in
part with the Pledged Collateral or any part thereof, and take possession
of the proceeds of any such sale, assignment or liquidation.
(iii) Take possession of the Pledged Collateral or any part thereof,
by directing Pledgor in writing to deliver the same to Collateral Agent at
any place or places designated by Collateral Agent and reasonably convenient
to Pledgor and Collateral Agent, in which event Pledgor shall at its own
expense: (a) forthwith cause the same to
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be moved to the place or places so designated by Collateral Agent and
there to be delivered to Collateral Agent; (b) store and keep any Pledged
Collateral so delivered to Collateral Agent at such place or places pending
further action by Collateral Agent; and (c) while the Pledged Collateral
shall be so stored and kept, provide such guards and maintenance services as
shall be necessary to protect the same and to preserve and maintain them in
good condition. Pledgor's obligation to deliver the Pledged Collateral is of
the essence of this Agreement. Upon application to a court of equity having
jurisdiction, Collateral Agent shall be entitled to a decree requiring
specific performance by Pledgor of such obligation.
(b) Remedies; Disposition of the Pledged Collateral.
(i) during the continuance of an Event of Default, Collateral Agent
may, in accordance with the terms of and at the times specified in the
Indenture, from time to time exercise in respect of the Pledged Collateral,
in addition to other rights and remedies provided for herein or otherwise
available to it, all the rights and remedies of a secured party under the
Code at the time of an event of default, and Collateral Agent may also,
without notice except as specified below, sell the Pledged Collateral or any
part thereof in one or more parcels at public or private sale, at any
exchange, broker's board or at any of Collateral Agent's offices or
elsewhere, for cash, on credit or for future delivery, and at such price or
prices and upon such other terms as Collateral Agent may deem commercially
reasonable.
(ii) the Collateral Agent, any Secured Party or any of their respective
Affiliates may be the purchaser of any or all of the Pledged Collateral at
any such sale and shall be entitled, for the purpose of bidding and making
settlement or payment of the purchase price for all or any portion of the
Pledged Collateral sold at such sale, to use and apply any of the Secured
Obligations owed to such Person as a credit on account of the purchase price
of any Pledged Collateral payable by such Person at such sale. Each purchaser
at any such sale shall acquire the property sold absolutely free from any
claim or right on the part of Pledgor, and Pledgor hereby waives, to the
fullest extent permitted by law, all rights of redemption, stay or appraisal
hereafter enacted. Collateral Agent shall not be obligated to make any sale
of Pledged Collateral regardless of notice of sale having been given.
Collateral Agent may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor,
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and such sale may, without further notice, be made at the time and place
to which it was so adjourned. Pledgor hereby waives, to the fullest
extent permitted by law, any claims against Collateral Agent arising by
reason of the fact that the price at which any Pledged Collateral may
have been sold at such a private sale was less than the price which might
have been obtained at a public sale, even if Collateral Agent accepts the
first offer received and does not offer such Pledged Collateral to more
than one offeree.
(iii) Pledgor agrees that, to the extent notice of sale shall be
required by law, 10 days' notice from Collateral Agent of the time and
place of any public sale or of the time after which a private sale or
other intended disposition is to take place shall be commercially
reasonable notification of such matters. No notification need be given to
Pledgor if it has signed, after the occurrence of an Event of Default, a
statement renouncing or modifying any right to notification of sale or
other intended disposition. In addition to the rights and remedies
provided in this Agreement, the Indenture and the other Collateral
Documents, Collateral Agent shall have all the rights and remedies of a
secured party under the Code.
(c) Waiver of Notice and Claims. Except as otherwise provided herein,
Pledgor hereby waives, to the fullest extent permitted by applicable law,
notice or judicial hearing in connection with Collateral Agent's taking
possession or Collateral Agent's disposition of any of the Pledged
Collateral, including, without limitation, any and all prior notice and
hearing for any prejudgment remedy or remedies and any such right which
Pledgor would otherwise have under law, and Pledgor hereby further waives, to
the fullest extent permitted by applicable law: (i) all damages occasioned by
such taking of possession; (ii) all other requirements as to the time, place
and terms of sale or other requirements with respect to the enforcement of
Collateral Agent's rights hereunder; and (iii) all rights of redemption,
appraisal, valuation, stay, extension or moratorium now or hereafter in force
under any applicable law. Any sale of, or the grant of options to purchase,
or any other realization upon, any Pledged Collateral shall operate to divest
all right, title, interest, claim and demand, either at law or in equity, of
Pledgor therein and thereto, and shall be a perpetual bar both at law and in
equity against Pledgor and against any and all Persons claiming or attempting
to claim the Pledged Collateral so sold, optioned or realized upon, or any
part thereof, from, through or under Pledgor.
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(d) Certain Sales of Pledged Collateral. Pledgor recognizes that, by
reason of certain prohibitions contained in law, rules, regulations or orders
of any Governmental Authority, Collateral Agent may be compelled, with
respect to any sale of all or any part of the Pledged Collateral, to limit
purchasers to those who meet the requirements of such Governmental Authority.
Pledgor acknowledges that any such sales may be at prices and on terms less
favorable to Collateral Agent than those obtainable through a public sale
without such restrictions, and, notwithstanding such circumstances, agrees
that any such restricted sale shall be deemed to have been made in a
commercially reasonable manner.
(e) Exercise of Remedies. Notwithstanding any other provision of this
Agreement to the contrary, Collateral Agent shall exercise, or shall refrain
from exercising, any remedy provided for in this Section 9 in accordance with
the terms of and at the times specified in the Indenture.
(f) Unsatisfied Obligations. Notwithstanding any other provision of this
Agreement to the contrary, if, after giving effect to any sale, transfer or
other disposition of any or all of the Pledged Collateral pursuant hereto and
after the application of the proceeds hereunder to the Secured Obligations,
if any Secured Obligations remain unpaid or unsatisfied, Pledgor shall remain
liable for the unpaid and unsatisfied amount of such Secured Obligations.
Section 10. Application of Proceeds. The proceeds received by Collateral
Agent in respect of any sale of, collection from or other realization upon
all or any part of the Pledged Collateral pursuant to the exercise by
Collateral Agent of its remedies as a secured creditor as provided in Section
9 hereof shall be applied, together with any other sums then held by
Collateral Agent pursuant to this Agreement, promptly by Collateral Agent in
accordance with the terms of the Indenture and the Intercreditor Agreement.
Section 11. Expenses. Pledgor will upon demand pay, without limitation,
to Collateral Agent the amount of any and all reasonable expenses, including
the fees and expenses of its counsel and the allocated costs of Collateral
Agent's internal counsel and the fees and expenses of any experts and agents
which Collateral Agent may incur in connection with (i) the collection of
the Secured Obligations, (ii) the enforcement and administration of this
Agreement, (iii) the custody or preservation of, or the sale of, collection
from, or other realization upon, any of the Pledged Collateral, (iv) the
exercise or enforcement of any of the rights of Collateral Agent or any
Secured Party hereunder or (v) the failure by Pledgor to perform
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or observe any of the provisions hereof. All amounts payable by Pledgor under
this Section 11 shall be due upon demand and shall be part of the Secured
Obligations. Pledgor's obligations under this Section 11 shall survive the
termination of this Agreement and the discharge of Pledgor's other
obligations hereunder.
Section 12. No Waiver; Cumulative Remedies.
(a) No failure on the part of Collateral Agent to exercise, no course of
dealing with respect to, and no delay on the part of Collateral Agent 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 hereunder preclude any other or further exercise thereof or the excise
of any other right, power or remedy. The remedies herein provided are
cumulative and are not exclusive of any remedies provided by law.
(b) In the event Collateral Agent shall have instituted any proceeding to
enforce any right, power or remedy under this Agreement by foreclosure, sale,
entry or otherwise, and such proceeding shall have been discontinued or
abandoned for any reason or shall have been determined adversely to
Collateral Agent, then and in every such case, Pledgor, Collateral Agent and
each holder of any of the Secured Obligations shall be restored to their
respective former positions and rights hereunder with respect to the Pledged
Collateral, and all rights, remedies and powers of Collateral Agent and the
Secured Parties shall continue as if no such proceeding had been instituted.
Section 13. Collateral Agent. Collateral Agent has been appointed as
collateral agent pursuant to the Indenture. The actions of Collateral Agent
hereunder are subject to the provisions of the Indenture. Collateral Agent
shall have the right hereunder to make demands, to give notices, to exercise
or refrain from exercising any rights, and to take or refrain from taking
action (including, without limitation, the release or substitution of Pledged
Collateral), in accordance with the Indenture. Collateral Agent may resign
and a successor Collateral Agent may be appointed in the manner provided in
the Indenture. Upon the acceptance of any appointment as Collateral Agent by
a successor Collateral Agent, that successor Collateral Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Collateral Agent under this Agreement, and the
retiring Collateral Agent shall thereupon be discharged from its duties and
obligations under this Agreement. After any retiring Collateral Agent's
resignation, the provisions of this Agreement
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shall inure to its benefit as to any actions taken or omitted to be taken by
it under this Agreement while it was Collateral Agent.
Section 14. Collateral Agent May Perform; Collateral Agent Appointed
Attorney-in-Fact. If Pledgor shall fail to do any act or thing that it has
covenanted to do hereunder or if any warranty on the part of Pledgor
contained herein shall be breached, Collateral Agent or any Secured Party may
(but shall not be obligated to) do the same or cause it to be done or remedy
any such breach, and may expend funds for such purpose. Any and all amounts
so expended by Collateral Agent or such Secured party shall be paid by
Pledgor promptly upon demand therefor, with interest at the highest rate then
in effect under the Indenture during the period from the including the date
on which such funds were so expended to the date of repayment. Pledgor's
obligations under this Section 14 shall survive the termination of this
Agreement and the discharge of Pledgor's other obligations under this
Agreement. Pledgor hereby appoints Collateral Agent its attorney-in-fact with
an interest, with full authority in the place and stead of Pledgor and in the
name of Pledgor, or otherwise, from time to time in Collateral Agent's
discretion to take any action and to execute any instrument consistent with
the terms of this Agreement which the Collateral Agent may deem necessary or
advisable to accomplish the purposes of this Agreement. The foregoing grant
of authority is a power of attorney coupled with an interest and such
appointment shall be irrevocable for the term of this Agreement. Pledgor
hereby ratifies all that such attorney shall lawfully do or cause to be done
by virtue hereof.
Section 15. Indemnity.
(a) Indemnity. Pledgor agrees to indemnify, pay and hold harmless
Collateral Agent and the officers, directors, employees, agents and
affiliates of Collateral Agent (collectively called the "Indemnitees") from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, claims, costs (including, without limitation,
settlement costs), expenses or disbursements of any kind or nature whatsoever
(including, without limitation, the reasonable fees and disbursements of
counsel for such Indemnitees in connection with any investigative,
administrative or judicial proceeding commenced or threatened, whether or not
such Indemnitee shall be designated a party thereto), which may be imposed
on, incurred by, or asserted against that Indemnitee, in any manner relating
to or arising our of this Agreement, the Indenture or the Notes (including,
without limitations, any misrepresentation by Pledgor in this Agreement, the
Indenture or the Notes) (the "indemnified liabilities"); provided
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that pledgor shall have no obligation to an Indemnitee hereunder with
respect to indemnified liabilities if it has been determined by a final
decision (after all appeals and the expiration of time to appeal) by a court
of competent jurisdiction that such indemnified liability arose from the
negligence or bad faith of that Indemnitee. To the extent that the
undertaking to indemnify, pay and hold harmless set forth in the preceding
sentence may be unenforceable because it is violative of any law or public
policy, Pledgor shall contribute the maximum portion which it is permitted to
pay and satisfy under applicable law, to the payment and satisfaction of all
indemnified liabilities incurred by the Indemnitees or any of them.
Collateral Agent shall give Pledgor prompt notice of the assertion of any
alleged indemnified liabilities and allow Pledgor to assist in defending same.
The Collateral Agent shall also have all the rights, benefits, immunities
and indemnities as described in the last paragraph of Section 7.07 of the
Indenture.
(b) Survival. The obligations of Pledgor contained in this section 15
shall survive the termination of this Agreement and the discharge of
Pledgor's other obligations under this agreement.
(c) Reimbursement. Any amounts paid by any Indemnitee as to which such
Indemnitee has the right to reimbursement shall constitute Secured
Obligations secured by the Pledged Collateral.
Section 16. Modification in Writing. No amendment, modification,
supplement, termination or waiver of or to any provision of this Agreement,
nor consent to any departure by Pledgor therefrom, shall be effective unless
the same shall be done in accordance with the terms of the Indenture and
unless the same shall be in writing and signed by Collateral Agent. Any
amendment, modification or supplement of or to any provision of this
Agreement, any waiver of any provision of this Agreement, and any consent to
any departure by Pledgor from the terms of any provision of this Agreement,
shall be effective only in the specific instance and for the specific purpose
for which made or given. Except where notice is specifically required by this
Agreement, no notice to or demand on Pledgor in any case shall entitle
Pledgor to any other or further notice or demand in similar or other
circumstances.
Section 17. Termination; Release. (a) Except as otherwise provided in
Sections 3, 11, 12(b) and 15, this Agreement shall terminate upon compliance
by Pledgor with all of the conditions precedent set forth in Article 8 of the
Indenture
15
for satisfaction and discharge of the Indenture. Upon termination of this
Agreement or any release of Pledged Collateral in accordance with the
provisions of the Indenture, Collateral Agent shall, upon the request and at
the sole cost and expense of Pledgor, forthwith assign, transfer and deliver
to Pledgor, against receipt and without recourse to or warranty by Collateral
Agent, such of the Pledged Collateral to be released (in the case of a
release) as may be in possession of Collateral Agent and as shall not have
been sold or otherwise applied pursuant to the terms hereof, on the order of
and at the sole cost and expense of Pledgor, and proper instruments
(including Uniform Commercial Code termination statements on Form UCC-3)
acknowledging the termination of this Agreement or the release of such
Pledged Collateral, as the case may be.
(b) In the event that any Asset Sale made by a Pledgor in accordance
with Section 4.16 of the Indenture involves the sale of an asset which
constitutes Pledged Collateral, Pledgor shall deliver all Net Cash Proceeds
received in respect of such item of Pledged Collateral to Collateral Agent to
be held by Collateral Agent as Trust Moneys pursuant to the Indenture until
such time as such Net Cash Proceeds are applied to an Asset Sale Offer or
invested in a Related Business Investment in accordance with Article 11 of
the Indenture.`
Section 18. Notices. Unless otherwise provided herein, any notice or
other communication herein required or permitted to be given shall be given
in the manner set forth in the Indenture, if to Pledgor, addressed to it at
the address set forth in the Indenture, if to Collateral Agent, addressed to
it at the address set forth on the signature page of this Agreement, or as to
any any party at such other address as shall be designated by such party in a
written notice to the other party complying as to delivery with the terms of
this Section 18. All such notices and other communications shall be deemed
to have been given when delivered in person, or received by telecopy or
telex; or 1 Business Day after delivery to the office of an overnight courier
service; or 4 Business Days after deposit in the United States mail,
registered or certified, with postage prepaid and properly addressed;
provided that notices to Collateral Agent shall not be effective until
received by Collateral Agent.
Section 19. Continuing Security Interest; Assignment. This Agreement
shall create continuing security interests in the Pledged Collateral and
shall (i) be binding upon Pledgor, its successors and assigns, and (ii)
inure, together with the rights and remedies of Collateral Agent hereunder,
to the benefit of Collateral Agent and the other Secured Parties and each of
their respective successors, transferees and assigns;
16
no other Persons (including, without limitation, any other creditor of
Pledgor) shall have any interest herein or any right or benefit with respect
hereto. Without limiting the generality of the foregoing clause (ii), any
Secured Party may assign or otherwise transfer any Note held by it secured by
this Agreement to any other Person, an such other Person shall thereupon
become vested with all the benefits in respect thereof granted to such person,
herein or otherwise, subject, however, to the provisions of the Indenture.
Section 20. GOVERNING LAW; TERMS. THIS AGREEMENT SHALL BE GOVERNED BY, AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS, EXCEPT TO THE
EXTENT THAT THE VALIDITY OR PERFECTION OF THE SECURITY INTERESTS HEREUNDER,
OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR PROPERTY ARE GOVERNED BY
THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
Section 21. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. ALL JUDICIAL
PROCEEDINGS BROUGHT AGAINST PLEDGOR WITH RESPECT TO THIS AGREEMENT MAY BE
BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE COUNTY
OF NEW YORK. IN THE STATE OF NEW YORK AND BY EXECUTION AND DELIVERY OF THIS
AGREEMENT PLEDGOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES,
GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE AFORESAID
COURTS, AND IRREVOCABLY AGREES TO BE BOUND BY AN JUDGMENT RENDERED THEREBY IN
CONNECTION WITH THIS AGREEMENT. PLEDGOR HEREBY IRREVOCABLY WAIVES TRIAL BY
JURY, AND PLEDGOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING, WITHOUT
LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF
ANY SUCH ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS. A COPY OF ANY
PROCESS SERVED ON PLEDGOR SHALL BE MAILED BY REGISTERED MAIL TO PLEDGOR AT
ITS ADDRESS PROVIDED FOR IN SECTION 18 HEREOF EXCEPT THAT UNLESS OTHERWISE
PROVIDED BY APPLICABLE LAW, ANY FAILURE TO MAIL SUCH COPY SHALL NOT AFFECT
THE VALIDITY OF SERVICE OF PROCESS. IF ANY AGENT APPOINTED BY PLEDGOR REFUSES
TO RECEIVE AND FORWARD SUCH SERVICE, PLEDGOR HEREBY AGREES THAT SERVICE UPON
IT BY MAIL SHALL CONSTITUTE SUFFICIENT NOTICE. NOTHING HEREIN SHALL AFFECT THE
RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT
THE RIGHT OF COLLATERAL AGENT TO BRING PROCEEDINGS AGAINST PLEDGOR IN THE
COURTS OF ANY OTHER JURISDICTION.
Section 22. Severability of Provisions. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective
17
to the extent of such prohibition or unenforceability without invalidating
the remaining provisions hereof or affecting the validity or enforceability
of such provision in any other jurisdiction.
Section 23. Execution in Counterparts. This Agreement and any amendments,
waivers, consents or supplements hereto may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each
of which when so executed and delivered shall be deemed to be an original,
but all such counterparts together shall constitute one and the same
agreement.
Section 24. Headings. The Section headings used in this Agreement are for
convenience of reference only and shall not affect the construction of this
Agreement.
Section 25. Obligations Absolute. All obligations of Pledgor hereunder
shall be absolute and unconditional irrespective of:
(i) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of Pledgor;
(ii) any lack of validity or enforceability of the Indenture or the
Notes or any other agreement or instrument relating thereto;
(iii) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Secured Obligations, or any
other amendment or waiver of or any consent to any departure from
the Indenture or the Notes or any other agreement or instrument
relating thereto;
(iv) any exchange, release or non-perfection of any other collateral,
or any release or amendment or waiver of or consent to any departure from
any guarantee, for all or any of the Secured Obligations;
(v) any exercise or non-exercise, or any waiver of any right, remedy,
power or privilege under or in respect of this Agreement, Indenture or the
Notes except as specifically set forth in a waiver granted pursuant to the
provisions of Section 16 hereof; or
(vi) any other circumstances which might otherwise constitute a
defense available to, or a discharge of, Pledgor.
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Section 26. Collateral Agent's Right to Sever Indebtedness.
(a) Pledgor acknowledges that (i) the Pledgor Collateral does not
constitute the sole source of security for the payment and performance of the
Secured Obligations and that the Secured Obligations are also secured by
other types of property of Pledgor and its Affiliates (all such property,
collectively, the "Collateral"), (ii) the number of jurisdictions and the
nature of the transaction of which this instrument is a part are such that it
would have been impracticable for the parties to allocate to each item of
Collateral a specific loan amount and to execute in respect of such item a
separate indenture and (iii) Pledgor intends that Collateral Agent have the
same rights with respect to the Pledged Collateral, in any judicial
proceeding relating to the exercise of any right or remedy hereunder or
otherwise, that Collateral Agent would have had if each item of collateral
had been pledged or encumbered pursuant to a separate indenture and security
agreement. In furtherance of such intent, Pledgor agrees to the greatest
extent permitted by law that Collateral Agent may at any time by notice (an
"Allocation Notice") to Pledgor allocate a portion of the Secured Obligations
(the "Allocated Indebtedness") to the Pledged Collateral and sever from the
remaining Secured Obligations the Allocated Indebtedness. From and after the
giving of an Allocation Notice with respect to the Pledged Collateral, the
Secured Obligations hereunder shall be limited to the extent set forth in the
Allocation Notice and (as so limited) shall, for all purposes, be construed
as a separate credit obligation of Pledgor unrelated to the other
transactions contemplated by the Indenture. To the extent that the proceeds
of any judicial proceeding relating to the exercise of any right or remedy
hereunder of the Pledged Collateral shall exceed the Allocated Indebtedness,
such proceeds shall belong to Pledgor and shall not be available hereunder to
satisfy any Secured Obligations of Pledgor other than the Allocated
Indebtedness. In any action or proceeding to exercise any right or remedy
under this Agreement which is commenced after the giving by Collateral Agent
of an Allocation Notice, the Allocation Notice shall be conclusive proof of
the limits of the Secured Obligations hereby secured, and Pledgor may
introduce, by way of defense or counterclaim, evidence thereof in any such
action or proceeding. Nothwithstanding any provision of this Section 26, the
proceeds received by Collateral Agent pursuant to this Agreement shall be
applied by Collateral Agent in accordance with the provisions of Section 10
hereof.
(b) Pledgor hereby waives to the greatest extent permitted under law the
right to a discharge of any of the Secured Obligations under any statute or
rule of law now or hereafter in
19
effect which provides that the exercise of any particular right or remedy as
provided for herein (by judicial proceedings or otherwise) constitutes the
exclusive means for satisfaction of the Secured Obligations or which makes
unavailable any further judgment or any other right or remedy provided for
herein because Collateral Agent elected to proceed with the exercise of such
initial right or remedy or because of any failure by Collateral Agent to
comply with laws that prescribe conditions to the entitlement to such
subsequent judgment or the availability of such subsequent right or remedy.
In the event that, notwithstanding the foregoing waiver, any court shall for
any reason hold that such subsequent judgment or action is not available to
Collateral Agent, Pledgor shall not (i) introduce in any other jurisdiction
any judgment so holding as a defense to enforcement against Pledgor of any
remedy in the Indenture or in any agreement executed in connection with the
Indenture or (ii) seek to have such judgment recognized or entered in any
other jurisdiction, and any such judgment shall in all events be limited in
application only to the state or jurisdiction where rendered and only with
respect to the Collateral referred to in such judgment.
(c) In the event any instrument in addition to the Allocation Notice is
necessary to effectuate the provisions of this Section 26, including, without
limitation, any amendment to this Agreement, any substitute promissory note
or affidavit or certificate of any kind, Collateral Agent may execute and
deliver such instrument as the attorney-in-fact of Pledgor.
(d) Notwithstanding anything set forth herein to the contrary, the
provisions of this Section 26 shall be effective only to the maximum extent
permitted by law.
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IN WITNESS WHEREOF, Pledgor has caused this Agreement to be executed and
delivered by its duly authorized officer as of the date first above written.
THE DOE RUN RESOURCES CORPORATION,
as Pledgor
By /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President and
Chief Financial Officer
STATE STREET BANK AND TRUST COMPANY,
as Collateral Agent
By /s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
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Schedule A
LOCATION OF EQUIPMENT*
[to be completed by drr]
-------------------
* Please confirm Ohio address where pledged Equipment is located.
