1
EXHIBIT 99.5
COLLATERAL TRUST AGREEMENT
dated as of August 20, 2001
among
PACIFICARE HEALTH PLAN ADMINISTRATORS, INC.,
as Grantor
and
WILMINGTON TRUST COMPANY
as Corporate Trustee
and
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
as Individual Trustee
2
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms ..................................... 2
SECTION 1.02. Certain References ........................................ 5
ARTICLE II
CONFIRMATION AND CREATION OF SECURITY INTERESTS
SECTION 2.01. Collateral Trust Estate ................................... 5
SECTION 2.02. Security for Secured Obligations .......................... 6
ARTICLE III
COLLATERAL ACCOUNT
SECTION 3.01. Collateral Account ........................................ 6
ARTICLE IV
ACTIONABLE DEFAULTS; REMEDIES
SECTION 4.01. Actionable Default Notice ................................. 7
SECTION 4.02. Direction by Required Representatives ..................... 8
SECTION 4.03. Right to Initiate Judicial Proceedings, Etc. .............. 8
SECTION 4.04. Remedies Not Exclusive .................................... 9
SECTION 4.05. Waiver of Certain Rights .................................. 9
SECTION 4.06. Limitation on Collateral Trustees' Duties
in Respect of Collateral .................................. 9
SECTION 4.07. Limitation by Law ......................................... 10
SECTION 4.08. Absolute Rights of Secured Holders and Representatives .... 10
SECTION 4.09. Equal and Ratable Security ................................ 10
ARTICLE V
APPLICATION OF PROCEEDS
SECTION 5.01. Application of Proceeds ................................... 11
SECTION 5.02. Application of Withheld Amounts ........................... 12
SECTION 5.03. Release of Amounts in Collateral Account .................. 13
SECTION 5.04. Distribution Date ......................................... 13
ARTICLE VI
AGREEMENTS WITH THE COLLATERAL TRUSTEE
3
2
SECTION 6.01. Delivery of Agreements .................................... 13
SECTION 6.02. Information as to Representatives ......................... 13
SECTION 6.03. Compensation and Expenses ................................. 14
SECTION 6.04. Stamp and Other Similar Taxes ............................. 14
SECTION 6.05. Filing Fees, Excise Taxes, Etc. ........................... 15
SECTION 6.06. Indemnification ........................................... 15
SECTION 6.07. Further Assurances ........................................ 15
ARTICLE VII
THE COLLATERAL TRUSTEE
SECTION 7.01. Declaration of Trust ...................................... 16
SECTION 7.02. Exculpatory Provisions .................................... 16
SECTION 7.03. Delegation of Duties ...................................... 17
SECTION 7.04. Reliance by Collateral Trustees ........................... 17
SECTION 7.05. Limitations on Duties of the Trustees ..................... 18
SECTION 7.06. Moneys to Be Held in Trust ................................ 18
SECTION 7.07. Resignation and Removal of Collateral Trustees ............ 18
SECTION 7.08. Status of Successors to Trustee ........................... 20
SECTION 7.09. Merger of the Corporate Trustee ........................... 20
SECTION 7.10. Powers of Individual Trustee .............................. 20
SECTION 7.11. Additional Co-Trustees; Separate Trustees ................. 21
SECTION 7.12. Trustees Appointed Attorneys-in-Fact ...................... 22
SECTION 7.13. Ordinary Care ............................................. 22
ARTICLE VIII
RELEASE OF COLLATERAL
SECTION 8.01. Partial Release of Collateral ............................. 23
SECTION 8.02. Full Release of Collateral Upon Satisfaction of
Certain Secured Obligations ............................... 24
SECTION 8.03. Effect of Release of Collateral ........................... 25
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Supplements and Waivers ....................... 25
SECTION 9.02. Additional Actions of Representatives ..................... 26
SECTION 9.03. Notices ................................................... 27
SECTION 9.04. Headings .................................................. 27
SECTION 9.05. Severability .............................................. 27
4
3
SECTION 9.06. Treatment of Payee or Indorsee by Trustees ................ 28
SECTION 9.07. Dealings with the Grantor ................................. 28
SECTION 9.08. Claims Against Trustee .................................... 28
SECTION 9.09. Binding Effect ............................................ 28
SECTION 9.10. Governing Law ............................................. 28
SECTION 9.11. Effectiveness ............................................. 29
SECTION 9.12. Reexecution of Agreement .................................. 29
SECTION 9.13. Effect on Credit Agreements ............................... 29
SECTION 9.14. Counterparts .............................................. 29
5
COLLATERAL TRUST AGREEMENT
COLLATERAL TRUST AGREEMENT, dated as of August 20, 2001 (as amended,
amended and restated, supplemented or otherwise modified from time to time, this
"AGREEMENT") among PacifiCare Health Plan Administrators, Inc., an Indiana
corporation (the "GRANTOR"), WILMINGTON TRUST COMPANY, a Delaware banking
corporation, not in its individual capacity but solely as corporate trustee
(together with any successor corporate trustee appointed pursuant to Article 7,
the "CORPORATE TRUSTEE"), and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, an individual residing in the
State of Delaware, not in his individual capacity but solely as individual
trustee (together with any successor individual trustee appointed pursuant to
Article 7, the "INDIVIDUAL TRUSTEE"; and, together with the Corporate Trustee,
the "COLLATERAL TRUSTEES"), the foregoing trustees being trustees for the
Secured Holders (as hereinafter defined). Certain capitalized terms used herein
are defined in Article 1 of this Agreement.
PRELIMINARY STATEMENTS:
(1) PacifiCare Health Systems, Inc., a Delaware corporation (the
"Borrower") has entered into an Amended and Restated Credit Agreement dated as
of August 20, 2001 (as the same may be amended, amended and restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT";
terms defined therein and not otherwise defined herein shall have the meanings
specified therein) with the banks and other financial institutions party thereto
(the "LENDERS"), Banc of America Securities LLC ("BANC OF AMERICA SECURITIES"),
as co-lead arranger, and Bank of America, N.A., as Administrative Agent
(together with any successor administrative agent appointed pursuant to Article
VII of the Credit Agreement, the "ADMINISTRATIVE AGENT") for the Lenders
thereunder. It is a condition precedent to the effectiveness of the Credit
Agreement that the Grantor shall have granted to the Collateral Trustees the
pledge and assignment of, and the lien and security interest in, certain
property and assets of the Grantor pursuant to the Shared Collateral Documents
(as hereinafter defined).
(2) The Grantor has issued 7% Senior Notes due 2003 (as amended,
supplemented or otherwise modified and in effect on the date hereof and as the
same may hereafter be further amended, modified, extended, renewed, replaced,
restated or supplemented from time to time pursuant to the terms thereof, the
"7% NOTES") pursuant to that certain Indenture dated as of September 22, 1993
(as amended, supplemented or otherwise modified and in effect on the date hereof
and as the same may be further amended, modified, extended, renewed, replaced,
restated or supplemented from time to time pursuant to the terms thereof, the
"7% NOTES INDENTURE", together with the 7% Notes, the "EXISTING INDEBTEDNESS
AGREEMENTS").
(3) Pursuant to the 7% Notes Indenture, the Grantor has agreed not to
incur, and not to permit certain of its Subsidiaries to incur, certain Liens (as
therein defined) upon any of its property or assets to secure certain
Indebtedness (as therein defined) without making effective provision whereby the
obligations under the Existing Indebtedness Agreements shall be secured equally
and ratably with the Indebtedness secured by such Liens for so long as such
Indebtedness shall be so secured.
(4) This Agreement and the other Shared Collateral Documents are
intended to secure the Existing Indebtedness Agreements to the extent required
to comply with the
6
2
provisions of the Existing Indebtedness Agreements and the Collateral Trustees
have agreed to undertake the rights, powers, duties and responsibilities set
forth in this Agreement and the other Shared Collateral Documents in order to
effect such purpose.
NOW THEREFORE, in consideration of the premises and in order to induce
the Lenders to extend credit to the Borrower under the Credit Agreement, the
Grantor hereby agrees with the Collateral Trustees for its benefit and the equal
and ratable benefit of the Secured Holders (as hereinafter defined) as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. The following terms shall have the
following meanings as used herein (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
"ACTIONABLE DEFAULT" has the meaning specified in Section 4.01.
"ACTIONABLE DEFAULT NOTICE" has the meaning specified in Section 4.01.
"ADDITIONAL COLLATERAL" has the meaning specified in Section 2.01.
"AUTHORIZED OFFICER" means the Chairman, the President, the Chief
Executive Officer, the Chief Financial Officer, the Comptroller, any Vice
President, the Secretary, Assistant Secretary, Treasurer or the Assistant
Treasurer of a Person or any other officer designated as an "Authorized Officer"
by the Board of Directors (or equivalent governing body) of such Person.
"BANKRUPTCY CODE" means Title 11 of the United States Code entitled
"Bankruptcy", as amended from time to time.
"BORROWER" has the meaning specified in the Preliminary Statements to
this Agreement.
"BUSINESS DAY" means a day of the year on which banks are not required
or authorized by law to close in New York City or the city in which the
Corporate Trustee maintains its corporate trust office.
"COLLATERAL" means, collectively, all of the "Collateral" (as defined in
the Shared Collateral Security Agreement) and all of the Additional Collateral.
"COLLATERAL ACCOUNT" has the meaning specified in Section 3.01.
"COLLATERAL TRUST ESTATE" means all of the right, title and interest of
the Collateral Trustees, whether now owned or hereafter acquired, in and to the
Collateral.
7
3
"COLLATERAL TRUSTEES" has the meaning specified in the recital of
parties to this Agreement.
"COLLATERAL TRUSTEES' FEES" means the fees and other amounts payable to
the Collateral Trustees pursuant to Sections 6.03, 6.04 and 6.05 and amounts
claimed and unpaid pursuant to Section 6.06.
"CORPORATE TRUSTEE" has the meaning specified in the recital of parties
to this Agreement.
"CREDIT AGREEMENT" has the meaning specified in the Preliminary
Statements.
"DEFAULTED AGREEMENT PARTY" has the meaning specified in Section 4.01.
"DISTRIBUTION DATE" means any date on which the Collateral Trustees
shall distribute moneys from the Collateral Account pursuant to Section 5.01.
"EXISTING INDEBTEDNESS AGREEMENTS" has the meaning specified in the
Preliminary Statements and each agreement and instrument delivered by the
Grantor pursuant thereto, as the same may be supplemented, amended or modified
from time to time in accordance with the provisions thereof.
"GRANTOR" has the meaning specified in the recitals of parties to this
Agreement.
"INDIVIDUAL TRUSTEE" has the meaning specified in the recital of parties
to this Agreement.
"LENDERS" has the meaning specified in the Preliminary Statements to
this Agreement.
"LENDER PARTIES" means the Administrative Agent, the Lenders, the
Issuing Bank and the Swing Line Bank.
"MOODY'S" means Moody's Investor's Service, Inc.
"PERSON" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government or
any political subdivision or agency thereof.
"REPRESENTATIVES" means at any time, collectively, (a) the
Administrative Agent, as the representative hereunder for the Lender Parties at
such time and (b) the 7% Notes Trustee, as the representative of the 7% Notes
Holders at such time.
"REQUIRED REPRESENTATIVES" means, (a) at any time that no Actionable
Default has occurred or is continuing, the Administrative Agent acting in its
own discretion or at the direction of the Required Lenders at such time, or (b)
at any time that an Actionable Default has occurred and is continuing, the
Representatives, on behalf of themselves and the Secured Holders represented
thereby, that own or hold (either by themselves or through their respective
8
4
Secured Holders) more than 50% of the aggregate amount of the outstanding
Secured Obligations at such time; provided, however, that amounts held at such
time by the Collateral Trustees on behalf of a Representative and such
Representative's Secured Holders in an account of the Corporate Trustee
established at the request of such Representative pursuant to Section 5.02
hereof shall be deemed to have been applied to repay the Secured Obligations of
such Secured Holders whether or not such amount has been so applied.
"SECURED AGREEMENTS" means, collectively, the Credit Agreement, the
Existing Indebtedness Agreements, any agreement or document relating to any
treasury management services provided by the Lender Parties or their affiliates
to the Grantor or any of its Subsidiaries, and each agreement or instrument
delivered by the Grantor pursuant thereto (including, without limitation, the
Shared Collateral Documents), as the same may be amended from time to time in
accordance with the provisions thereof.
"SECURED HOLDERS" means, at any time, the Lender Parties and the 7%
Notes Holders.
"SECURED OBLIGATIONS" means at any time any obligations, whether matured
or unmatured, contingent or liquidated, of the Grantor arising out of or
evidenced by the Secured Agreements, whether for principal, interest, expenses,
premiums, indemnities, fees or other amounts, whether or not such obligations
are due and payable at such time. For purposes of determining the "Required
Representatives" on any date, the aggregate amount of outstanding Secured
Obligations represented by each Representative on such date shall include:
(a) in the case of the Secured Obligations of Secured Holders
represented by the Administrative Agent under the Credit Agreement, the
sum of the aggregate amount of the Advances outstanding at such time,
the aggregate Available Amount of all Letters of Credit outstanding at
such time and the Unused Revolving Credit Commitments at such time, and
(b) in the case of Secured Obligations of Secured Holders
represented by the 7% Notes Trustee under the 7% Notes Indenture, the 7%
Notes then Outstanding (as therein defined).
"7% NOTES" has the meaning provided in the Preliminary Statements.
"7% NOTES HOLDERS" means at any time the registered holders of the 7%
Notes issued under the 7% Notes Indenture at such time.
"7% NOTES INDENTURE" has the meaning provided in the Preliminary
Statements.
"7% NOTES TRUSTEE" means The Chase Manhattan Bank, as Trustee for the 7%
Notes Holders, and any successor trustee for the 7% Notes Holders appointed
under the 7% Notes Indenture.
"SHARED COLLATERAL DOCUMENTS" means this Agreement, the Shared
Collateral Security Agreement and each Successor Collateral Agreement.
9
5
"SHARED COLLATERAL SECURITY AGREEMENT" means the Shared Collateral
Security Agreement dated August 17, 2001 by the Grantor in favor of the
Collateral Trustees, on behalf of the Representatives and the Secured Holders,
in substantially the form of Exhibit D-2 to the Credit Agreement.
"S&P" means Standard & Poors, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc.
"SUCCESSOR COLLATERAL" means, with respect to the Grantor, any property
and assets of the Grantor (or any of its successors and assigns) as the Grantor
(or any such successor or any such assign) may, from time to time, upon notice
to the Collateral Trustees, pursuant to the Existing Indebtedness Agreements or
otherwise, grant to the Collateral Trustees as additional collateral for their
benefit and in trust for the equal and ratable benefit of the Representatives,
on their behalf and on behalf of the Secured Holders.
"SUCCESSOR COLLATERAL AGREEMENTS" means all documents creating,
evidencing or relating to any of the Successor Collateral.
SECTION 1.02. Certain References. In this Agreement, the words "hereof,"
"herein" and "hereunder", and words of similar import, shall refer to this
Agreement as a whole and not to any particular provision of this Agreement. All
section, schedule and exhibit references set forth in this Agreement are, unless
otherwise specified, references to such section in, or schedule or exhibit to,
this Agreement.
ARTICLE II
CONFIRMATION AND CREATION OF SECURITY INTERESTS
SECTION 2.01. Collateral Trust Estate. The Grantor hereby confirms that,
pursuant to the terms of the Shared Collateral Security Agreement, the Grantor
has pledged and assigned to the Collateral Trustees for their benefit and in
trust for the equal and ratable benefit of the Representatives and the Secured
Holders, and has granted the Collateral Trustees for their benefit and in trust
for the equal and ratable benefit of the Representatives and the Secured Holders
a lien on, and security interest in, the Collateral described therein. The
Grantor hereby further pledges and assigns to the Collateral Trustees for their
benefit and in trust for the equal and ratable benefit of the Representatives,
on their behalf and on behalf of the Secured Holders, and hereby grants to the
Collateral Trustees for their benefit and in trust for the equal and ratable
benefit of the Representatives, on their behalf and on behalf of the Secured
Holders, a lien on, and security interest in, the following (collectively,
together with any Successor Collateral, the "ADDITIONAL COLLATERAL"):
(i) the Collateral Account established pursuant to Section
3.01(a) with the Corporate Trustee at its offices at its corporate trust
department in the State of Delaware and is, and shall at all times
remain, under the sole dominion and control of the Corporate Trustee,
all funds held therein and all certificates and instruments, if any,
from time to time representing each Collateral Account;
10
6
(ii) all Cash Equivalents held in the Collateral Account from
time to time and all certificates and instruments, if any, from time to
time representing or evidencing such Cash Equivalents;
(iii) all notes, certificates of deposit, deposit accounts,
checks and other instruments from time to time delivered to or otherwise
possessed by the Collateral Trustees for or on behalf of the Grantor in
substitution for or in addition to any or all of the then existing
Additional Collateral;
(iv) all interest, income, dividends, instruments and other
property and assets from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the then
existing Additional Collateral referred to in clauses (i) through (iii)
of this Section 2.01(a); and
(v) all proceeds of any and all of the foregoing Additional
Collateral (including, without limitation, proceeds that constitute
property and assets of the types described in clauses (i) through (iv)
of this Section 2.01(a)) and, to the extent not otherwise included, all
(A) payments under any indemnity, warranty or guaranty payable with
respect to any of the foregoing Additional Collateral, and (B) cash.
SECTION 2.02. Security for Secured Obligations. All of the right, title
and interest of the Collateral Trustees in and to the Collateral Trust Estate
secures the payment of all of the Secured Obligations now or hereafter existing
under or in respect of the Secured Agreements and the performance of, and the
compliance with, all of the covenants and conditions of this Agreement, the
other Shared Collateral Documents and the Secured Agreements. Without limiting
the generality of the foregoing, the Collateral Trust Estate secures the payment
of all amounts that constitute part of the Secured Obligations and would be owed
by the Grantor to the Collateral Trustees, any Representative or any Secured
Holder under the Shared Collateral Documents or the Secured Agreements but for
the fact that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving the Grantor.
ARTICLE III
COLLATERAL ACCOUNT
SECTION 3.01. Collateral Account. (a) So long as any Secured Obligations
remain outstanding under any Secured Agreement, a non-interest bearing cash
collateral account (the "COLLATERAL ACCOUNT") for the Representatives and the
Secured Holders shall be maintained by the Corporate Trustee at its offices at
its corporate trust department in the State of Delaware in accordance with the
terms of this Agreement. All moneys that are received by the Collateral Trustees
upon the occurrence and during the continuance of an Actionable Default, upon
liquidation or otherwise in respect of the Collateral shall be deposited in the
Collateral Account and, thereafter, shall be held and applied by the Corporate
Trustee all in accordance with the terms of this Agreement.
(b) The Corporate Trustee shall, subject to the provisions of Article IV
and Article VIII, from time to time (i) invest amounts on deposit in the
Collateral Account in Cash
11
7
Equivalents and (ii) invest interest paid on such Cash Equivalents, and reinvest
other proceeds of any such Cash Equivalents that may mature or be sold, in
additional Cash Equivalents, in each case at the direction of the Grantor so
long as no Actionable Default shall have occurred and be continuing and at the
direction of the Required Representatives if an Actionable Default shall have
occurred and be continuing. Interest and proceeds that are not invested or
reinvested in Cash Equivalents as provided in the immediately preceding sentence
shall be deposited and held in the Collateral Account. Notwithstanding the
foregoing, the Corporate Trustee shall, to the extent possible, invest any funds
to be distributed on a Distribution Date in Cash Equivalents that shall mature
or become liquid on or prior to such Distribution Date. All Cash Equivalents
made in respect of the Collateral Account and all interest and income received
thereon and therefrom and the net proceeds realized on the maturity or sale
thereof shall be held in the Collateral Account as part of the Collateral Trust
Estate pursuant to the terms hereof.
(c) The Collateral Account shall be subject to such applicable laws, and
such applicable regulations of the Board of Governors of the Federal Reserve
System and of any other appropriate banking or regulatory authority, as are in
effect from time to time.
ARTICLE IV
ACTIONABLE DEFAULTS; REMEDIES
SECTION 4.01. Actionable Default Notice. (a) If, at any time, a default
under any Secured Agreement shall have occurred and be continuing and, as a
result thereof, any Representative or any Secured Holder under, or the
percentage of Secured Holders specified in, such Secured Agreement (any such
party or percentage of Secured Holders being a "DEFAULTED AGREEMENT PARTY") has
the right thereunder (without the delivery of any further notice or the
requirement that any further time elapse) to declare all of the Secured
Obligations of the Grantor under such Secured Agreement to be due and payable
prior to the stated maturity thereof (any such default being an "ACTIONABLE
DEFAULT"), and if such Defaulted Agreement Party gives the Collateral Trustees,
with a copy to the Grantor, a written notice (an "ACTIONABLE DEFAULT NOTICE")
stating:
(i) the nature of the Actionable Default;
(ii) the action requested to be taken by the Collateral Trustees
with respect to the Collateral and the Shared Collateral Documents
(which action may include, without limitation, the calling of a meeting
of the Representatives or the institution of any remedies provided by
law or this Agreement or any Shared Collateral Document); and
(iii) that such Defaulted Agreement Party has polled the
Representatives with respect to such action,
then the Collateral Trustees shall forthwith send a copy of the Actionable
Default Notice to each Representative. The Representatives shall provide the
Collateral Trustee with a certificate that shall state whether or not they favor
the Collateral Trustees taking such action. If the Required Representatives
shall have directed the Collateral Trustees to commence the action set forth in
the Actionable Default Notice (whether or not such poll shall have been taken or
completed), then, subject to Section 4.01(b) and the right of the Collateral
Trustees to commence such action
12
8
under the Shared Collateral Documents, the Collateral Trustees shall forthwith
undertake such action. The Collateral Trustees shall, subject to Sections
4.01(b), 4.08 and 6.06, follow the directions of the Required Representatives
with respect to the time, method and place of taking any action requested in an
Actionable Default Notice. Each Collateral Trustee shall be entitled to assume
conclusively that no Actionable Default has occurred and is continuing until it
receives an Actionable Default Notice.
(b) If the Actionable Default, which was the basis for the giving of an
Actionable Default Notice, shall be cured or waived in accordance with the terms
of the applicable Secured Agreement, the Defaulted Agreement Party which gave
such Actionable Default Notice shall promptly notify the Collateral Trustees in
writing of such cure or waiver, upon receipt of such written notice of a cure or
waiver (i) such Actionable Default Notice shall be deemed withdrawn, (ii) the
Collateral Trustees shall deliver to each Representative such writing evidencing
the cure or waiver of a Default Notice as it may have received pursuant to this
Section (b) and (iii) any direction to the Collateral Trustees to take any
action in connection with such Actionable Default Notice shall be deemed
immediately rescinded. If in connection solely with such withdrawn Actionable
Default Notice the Collateral Trustees shall have been directed to take, and
shall have commenced taking but shall not have completed, any action, the
Collateral Trustees shall promptly terminate any such action which they shall
not also have been directed to take in connection with an Actionable Default
Notice other than that withdrawn.
SECTION 4.02. Direction by Required Representatives. As to any matters
not expressly provided for under this Agreement or the other Shared Collateral
Documents (including, without limitation, matters relating to enforcement and
collection of the Secured Obligations), the Collateral Trustees shall not be
required to exercise any discretion or to take any action under this Agreement
or the other Shared Collateral Documents, or in respect of the Collateral, but
shall be required to act or to refrain from acting (and shall be fully protected
in acting or refraining from acting) in accordance with the written instructions
of the Required Representatives which instructions shall reference Section 6.06
hereof.
SECTION 4.03. Right to Initiate Judicial Proceedings, Etc. (a) Upon the
occurrence of and during the continuance of any Actionable Default and the
receipt by the Collateral Trustees of an Actionable Default Notice that has not
been withdrawn pursuant to Section 4.01(b) above, the Corporate Trustee, and if
the Corporate Trustee deems necessary or desirable, the Individual Trustee,
jointly or individually as the Corporate Trustee may determine, (i) shall have
the right and power to institute and maintain such suits and proceedings as it
or they, as the case may be, or the Required Representatives may deem
appropriate to protect and enforce the rights vested in them by this Agreement
and the other Shared Collateral Documents and (ii) may either, after entry or
without entry, proceed by suit or suits at law or in equity to enforce such
rights and to foreclose upon the Collateral and to dispose of, collect or
otherwise realize upon, all or any portion of the Collateral Trust Estate under
the judgment or decree of a court of competent jurisdiction.
(b) If a receiver of the Collateral Trust Estate shall be appointed in
judicial proceedings, the Collateral Trustees may be appointed as such receiver.
Notwithstanding the appointment of a receiver, the Collateral Trustees shall be
entitled to retain possession and
13
9
control of all cash held by or deposited with them or their agents or
co-trustees pursuant to any provision of this Agreement or any other Shared
Collateral Document.
SECTION 4.04. Remedies Not Exclusive. (a) No remedy conferred upon or
reserved to the Collateral Trustees herein or in the Shared Collateral Documents
is intended to be a limitation exclusive of any other remedy or remedies, but
every such remedy shall be cumulative and shall be in addition to every other
remedy conferred herein or in the Shared Collateral Documents or now or
hereafter existing at law or in equity or by statute.
(b) No delay or omission of either of the Collateral Trustees to
exercise any right, remedy or power accruing upon any Actionable Default shall
impair any such right, remedy or power or shall be construed to be a waiver of
any such Actionable Default or any acquiescence therein; and every right, power
and remedy given by this Agreement or any Shared Collateral Document to the
Collateral Trustees may be exercised from time to time and as often as may be
deemed expedient by the Collateral Trustees.
(c) In case either of the Collateral Trustees shall have proceeded to
enforce any right, remedy or power under this Agreement or any Shared Collateral
Document and the proceeding for the enforcement thereof shall have been
discontinued or abandoned for any reason or shall have been determined adversely
to such Collateral Trustee, then and in every such case the Grantor, the
Collateral Trustees, the Representatives and Secured Holders shall, subject to
any determination in such proceeding, severally be restored to their former
positions and rights hereunder and under such Shared Collateral Document with
respect to the Collateral Trust Estate, the Collateral Account and in all other
respects, and thereafter all rights, remedies and powers of such Collateral
Trustee shall continue as though no such proceeding had been taken.
(d) The Grantor expressly agrees that all rights of action and rights to
assert claims upon or under this Agreement and the Shared Collateral Documents
may be enforced by the Collateral Trustees without the possession of any debt
instrument or the production thereof in any trial or other proceeding relative
thereto, and any such suit or proceeding instituted by the Collateral Trustees
shall be brought in either of their names as Collateral Trustee and any recovery
of judgment shall be held as part of the Collateral Trust Estate; provided that
nothing in this Section 4.04(d) shall constitute a waiver of any right that the
Grantor may have or may hereafter acquire to challenge the amounts outstanding
under the Secured Agreements.
SECTION 4.05. Waiver of Certain Rights. The Grantor, on behalf of itself
and all who may claim through or under it, including, without limitation, any
and all subsequent Affiliates, creditors, vendees, assignees and lienors,
expressly waives and releases, to the fullest extent permitted by law, any,
every and all rights to demand or to have any marshalling of the Collateral
Trust Estate upon any enforcement of any Shared Collateral Document, including,
without limitation, upon any sale, whether made under any power of sale herein
granted or pursuant to judicial proceedings or upon any foreclosure or any
enforcement of any Shared Collateral Document or this Agreement and consents and
agrees that all the Collateral Trust Estate and any such sale may be offered and
sold as an entirety.
SECTION 4.06. Limitation on Collateral Trustees' Duties in Respect of
Collateral. Beyond the duties set forth in this Agreement, the Collateral
Trustees shall not have
14
10
any duty to the Grantor or the Representatives as to any Collateral in the
Collateral Trustees' possession or control or in the possession or control of
any agent or nominee of the Collateral Trustees or any income thereon or as to
the preservation of rights against prior parties or any other rights pertaining
thereto, except that each Collateral Trustee shall be liable for its failure to
exercise ordinary care in the handling of moneys and securities and other
property actually received by it.
SECTION 4.07. Limitation by Law. All rights, remedies and powers
provided by this Article 4 may be exercised only to the extent that the exercise
thereof does not violate any applicable provision of law, and all the provisions
of this Article 4 are intended to be subject to all applicable mandatory
provisions of law which may be controlling and to be limited to the extent
necessary so that they will not render this Agreement invalid, unenforceable in
whole or in part or, if the Representatives elect that this Agreement should be
recorded, registered or filed, not entitled to be recorded, registered, or filed
under the provisions of any applicable law.
SECTION 4.08. Absolute Rights of Secured Holders and Representatives.
Notwithstanding any other provision of this Agreement or any of the other Shared
Collateral Documents, each of the Representatives and each of the Secured
Holders has an absolute and unconditional right to receive payment of all of the
Secured Obligations owing to such Representative or such Secured Holder, as the
case may be, when the same becomes due and payable and at the time and place and
otherwise in the manner set forth in the applicable Secured Agreements, and the
right of each such Representative and each such Secured Holder to institute
proceedings for the enforcement of such payment on or after the date such
payment becomes due and to assert its position as a secured creditor in a
proceeding under the Bankruptcy Code in which the Grantor is a debtor, and the
obligation of the Grantor to pay all of the Secured Obligations owing to each of
the Representatives and each of the Secured Holders at the time and place
expressed therein, shall not be impaired or affected without the consent of such
Representative or such Secured Holder. In addition, the right of any Secured
Holder or any Representative, on behalf of itself or on behalf of any such
Secured Holder, to receive payment or security from sources other than the
Collateral shall not be, and is not hereby, impaired or affected in any manner.
Without limiting the generality of the foregoing provisions of this Section
4.08, no Secured Holder and no Representative, on behalf of itself or on behalf
of any Secured Holder, shall be obligated to share with any other Secured Holder
or any other Representative any proceeds of any collateral, guaranty or right of
setoff other than pursuant to, and to the extent expressly required under, this
Agreement and the other Secured Agreements; nor shall any Secured Holder's or
any Representative's right to receive its ratable share of any amounts
maintained in the Collateral Account, if any, or any proceeds of any of the
Collateral, or any part thereof, under the terms of this Agreement and the other
Shared Collateral Documents be diminished or affected in any way by its right to
receive proceeds of any other collateral or right of setoff, or payment upon a
guaranty or from any other source.
SECTION 4.09. Equal and Ratable Security. This Agreement is intended
solely to comply with the provisions of the Existing Indebtedness Agreements to
secure the unpaid Secured Obligations arising thereunder, equally and ratably
with the Secured Obligations arising under the Credit Agreement. To the extent
that the rights and benefits herein conferred on the Secured Holders or the
Representative under any Existing Indebtedness Agreement shall be held to exceed
the rights and benefits required so to be conferred by such provisions of such
Existing
15
11
Indebtedness Agreement, such rights and benefits shall be limited so as to
provide to such Secured Holders and such Representative only those rights and
benefits that are required by such provisions of such Existing Indebtedness
Agreement. Any and all rights not herein expressly given to the Representatives
under any Existing Indebtedness Agreement are expressly reserved to Lender
Parties under the Credit Agreement, it being understood that in the absence of a
requirement to provide equal and ratable security set forth in the Existing
Indebtedness Agreements, this Agreement would not have been accepted by the
Lender Parties.
ARTICLE V
APPLICATION OF PROCEEDS
SECTION 5.01. Application of Proceeds. (a) If, following the
acceleration of the principal amount of the Secured Obligations under any
Secured Agreement and pursuant to the exercise of any remedy set forth in any
Shared Collateral Documents, any Collateral is sold or otherwise realized upon
by the Collateral Trustees, the proceeds received by the Collateral Trustees in
respect of such Collateral shall be deposited in the Collateral Account, and all
moneys held by the Corporate Trustee in the Collateral Account shall, to the
extent available for distribution, be distributed by the Corporate Trustee on
each date upon which a distribution is made (each, a "DISTRIBUTION DATE") as
follows:
FIRST, to the payment (in such priority as the Corporate Trustee
shall elect, but without duplication) of all reasonable legal fees and
expenses and other reasonable costs or expenses or other liabilities of
any kind incurred by the Collateral Trustees as secured parties under
any Shared Collateral Document or otherwise in connection with any
Shared Collateral Document or this Agreement (including, without
limitation, any reasonable costs or expenses or liabilities incurred in
connection with the sale of any assets covered by any Shared Collateral
Document, or in the operation or maintenance of any of the assets
covered by any Shared Collateral Document), including the reimbursement
to any Representative of any amounts theretofore advanced by such
Representative for the payment of such fees, costs and expenses, except
only for any such fees, expenses, costs or liabilities incurred by any
Collateral Trustee as a result of its gross negligence or willful
misconduct in performing or failing to perform any of its duties to the
parties hereto expressly set forth herein; provided, however, that
nothing herein is intended to relieve the Grantor of its duties to pay
such costs, fees, expenses and liabilities otherwise payable to the
Collateral Trustees from funds outside of the Collateral Account, as
required by this Agreement;
SECOND, to the Collateral Trustees (without duplication) in an
amount equal to the Collateral Trustees' Fees which are unpaid as of the
Distribution Date and to any Representative which has theretofore
advanced or paid any such Collateral Trustees' Fees in an amount equal
to the amount thereof so advanced or paid by such Representative prior
to such Distribution Date; provided, however, that nothing herein is
intended to relieve any Borrower of its duties to pay such fees and
claims from funds outside of the Collateral Account, as required by this
Agreement;
16
12
THIRD, in accordance with paragraph (b) below, with respect to
any proceeds, ratably to the Representatives on behalf of the respective
Secured Holders for application to the Secured Obligations of such
Secured Holders, or, to be held by such Representative (or by the
Corporate Trustee on behalf of such Representative pursuant to Section
5.02 or otherwise) pending such application; provided, however, that any
proceeds received in respect of the Collateral shall be applied first to
the Administrative Agent, on behalf of the Lender Parties, up to the
maximum amount permitted by the terms and conditions of the 7% Notes
Indenture; and
FOURTH, any surplus remaining after the payment in full in cash
of the Secured Obligations shall, pursuant to the provisions of Section
8.02, be paid to the Grantor, its successors or assigns, or to
whomsoever may be lawfully entitled to receive the same, or as a court
of competent jurisdiction may direct.
(b) In order to determine the ratable amount to be distributed to each
of the Representatives pursuant to clause THIRD above on each Distribution Date,
unless otherwise directed in writing by the Representatives, the Corporate
Trustee may rely on a certificate of an Authorized Officer of the Grantor
setting forth the Secured Obligations (identified by type and amount)
outstanding under each Secured Agreement on such Distribution Date. The ratable
portion of the aggregate amount available for distribution hereunder on any
Distribution Date which shall be distributed to each Representative on such
Distribution Date shall be a fraction, (i) the numerator of which shall be the
aggregate amount of Secured Obligations of the Secured Holders represented by
such Representative, and (ii) the denominator of which shall be the aggregate
amount of Secured Obligations of all the Secured Holders represented by all;
provided, however, that the aggregate amount distributable to such
Representative on such Distribution Date shall not exceed the aggregate amount
of Secured Obligations of the Grantor which are then due and payable by the
Borrower to the Secured Holders of such Representative; and, provided, further,
that, for such purposes, amounts distributable to a Representative on a prior
Distribution Date and held on behalf of such Representative and the Secured
Holders of such Representative pursuant to Section 5.02 of this Agreement shall
be deemed to have been applied to the Secured Obligations of the Secured Holders
represented by such Representative, regardless of whether such application has
occurred.
SECTION 5.02. Application of Withheld Amounts. If on any Distribution
Date any amounts on deposit to the Collateral Account are distributable pursuant
to Section 5.01 to any Representative, and if such Representative shall have
given notice to the Collateral Trustees on or prior to such Distribution Date
that all or a portion of such proceeds which are otherwise distributable to such
Representative pursuant to Section 5.01 shall be held by the Collateral Trustees
on behalf of such Representative for the benefit of the Secured Holders of such
Representative, then the Collateral Trustees shall hold such amount in a
separate non-interest bearing cash collateral account of the Corporate Trustee
for the benefit of such Representative and such Secured Holders, until such time
as such Representative shall deliver a written request for the delivery thereof
from such account to such Representative or as such Representative may otherwise
direct in such notice. If thereafter the Secured Obligations of the Secured
Holders represented by any such Representative shall have been repaid in full in
cash on any date, then (a) upon the written request of the Grantor (or any other
Representative) certifying as to such payment in full, and (b) after delivery of
such notice by the Collateral Trustees to such
17
13
Representative, the Collateral Trustees shall not have received a written notice
of objection from such Representative within 30 days such Representative's
receipt of such notice, promptly following such 30th day (or the earlier receipt
by the Collateral Trustees of the written consent of such Representative), any
amounts held on account for such Representative pursuant to this Section 5.02
shall be again deposited by the Collateral Trustee to the Collateral Account and
thereafter distributed as provided in Section 5.01. The Corporate Trustee shall
invest amounts on deposit to any such account in such Cash Equivalents as the
applicable Representative may direct from time to time.
SECTION 5.03. Release of Amounts in Collateral Account. Amounts
distributable to a Representative on any Distribution Date pursuant to Section
5.01 shall either be paid to such Representative for the benefit of such
Representative and its Secured Holders by the Corporate Trustee (or deposited to
an account for the benefit of such Representative and its Secured Holders
pursuant to Section 5.02) upon receipt by the Corporate Trustee of a written
certificate of such Representative setting forth appropriate payments
instructions for such Representative. If no such notice is delivered by a
Representative within 10 Business Days thereafter, the Corporate Trustee shall
deposit amounts otherwise distributable to such Representative to an account for
the benefit of such Representative and its Secured Holders pursuant to Section
5.02 hereof.
SECTION 5.04. Distribution Date. Upon the occurrence and during the
continuance of an Actionable Default, any amounts on deposit in the Collateral
Account shall, at the written request of a Defaulted Agreement Party (with a
copy to the Grantor), and with the written consent of the Required
Representatives, be distributed as provided in this Article V.
ARTICLE VI
AGREEMENTS WITH THE COLLATERAL TRUSTEE
SECTION 6.01. Delivery of Agreements. On the Effective Date, the Grantor
will deliver to the Collateral Trustees a true and complete copy of each Secured
Agreement, including each Shared Collateral Document, as in effect on the
Effective Date. The Grantor agrees that, promptly upon the execution thereof,
the Grantor will deliver to the Collateral Trustees a true and complete copy of
any and all Shared Collateral Documents entered into subsequent to the date
hereof and a true and complete copy of any and all amendments, modifications or
supplements to any of the foregoing.
SECTION 6.02. Information as to Representatives. The Grantor agrees that
it shall deliver to the Collateral Trustees from time to time upon request of
the Collateral Trustees a list setting forth, for each Secured Agreement, (a)
the aggregate principal amount outstanding thereunder, (b) the accrued and
unpaid interest thereunder, (c) the accrued and unpaid fees (if any) thereunder,
(d) the names of the Representatives and of the Secured Holders (to the extent
known to the Grantor) thereunder, and all other unpaid amounts thereunder known
to the Grantor, owing to each such Representative, for its own account and on
behalf of such Secured Holders and (e) such other information regarding the
Representatives, such Secured Holders and the Secured Agreements as the
Collateral Trustees may reasonably request. In addition, the Grantor shall
deliver to the Collateral Trustees, each time a distribution from the Collateral
Trust
18
14
Estate or, the Collateral Account is to be made pursuant to the terms hereof,
not later than two Business Days after receipt of a copy of the applicable
distribution request delivered by a Defaulted Agreement Party pursuant to
Section 5.04 hereof, a certificate of an Authorized Officer, setting forth the
amounts to be distributed and the Persons to whom such distributions are to be
made, including appropriate payment instructions therefor, provided, that if any
distribution is directed to be made to any Representative, if such
Representative shall have notified the Collateral Trustees in writing that such
Representative is unable to accept such distribution, such distribution shall be
made instead to an account established pursuant to Section 5.02 hereof for the
benefit of such Representative and its Secured Holders. The Grantor will furnish
to the Collateral Trustees, with a copy to each Representative, on the Effective
Date a list setting forth the name and address of each Representative and each
Person to whom notices must be sent under the Secured Agreements and the Grantor
agrees to furnish promptly to the Collateral Trustees any changes or additions
to such list of which the Grantor is made aware. Unless otherwise specified
herein, the Collateral Trustees may for all purposes hereunder, rely on such
information given by the Grantor unless (i) the Collateral Trustees shall have
actual knowledge of an inaccuracy or (ii) any Representative shall provide
contrary information in writing with respect to such Representative in which
case, unless such Representative and the Grantor can reach an agreement on such
issue within a period of 10 days, the Collateral Trustees shall appoint an
independent arbitrator (who shall be reasonably acceptable to the Grantor and
such Representative) to resolve the dispute (at the expense of the Grantor).
SECTION 6.03. Compensation and Expenses. The Grantor agrees to pay to
the Collateral Trustees and any co-trustees or successor trustees appointed
hereunder, from time to time upon demand, (a) such compensation for their
services hereunder and under the Shared Collateral Documents and for
administering the Collateral Trust Estate, the Collateral Account and any
account or accounts established pursuant to Section 5.02 hereof as set forth on
the fee schedule attached hereto as Schedule 1, as such Schedule 1 may be
amended, supplemented or otherwise modified by the written agreement of the
Grantor and the Collateral Trustees from time to time and (b) all the reasonable
fees, costs and expenses incurred by any of them (including, without limitation,
the reasonable fees and disbursements of counsel) (i) arising in connection with
the preparation, execution, delivery, modification and termination of this
Agreement and each Shared Collateral Document or the enforcement of any of the
provisions hereof or thereof or (ii) incurred or required to be advanced in
connection with the administration of the Collateral Trust Estate, the
Collateral Account, any account or accounts established pursuant to Section 5.02
hereof, the sale or other disposition of Collateral pursuant to any Shared
Collateral Document and the preservation, protection or defense of their rights
under this Agreement and in and to the Collateral, the Collateral Account, any
account or accounts established pursuant to Section 5.02 hereof and the
Collateral Trust Estate. As security for such payment, the Collateral Trustees
shall have a prior lien upon all Collateral and other property and funds held or
collected by the Collateral Trustees as part of the Collateral Trust Estate. The
Grantor's obligations under this Section 6.03 shall survive the termination of
this Agreement.
SECTION 6.04. Stamp and Other Similar Taxes. The Grantor agrees to
indemnify and hold harmless the Collateral Trustees, each Representative and
each Secured Holder from any present or future claim for liability for any stamp
or other similar tax and any penalties or interest with respect thereto, which
may be assessed, levied or collected by any jurisdiction in connection with this
Agreement, any Shared Collateral Document, the Collateral
19
15
Trust Estate, the Collateral Account, any account or accounts established
pursuant to Section 5.02 hereof or any Collateral. The obligations of the
Grantor under this Section 6.04 shall survive the termination of this Agreement.
SECTION 6.05. Filing Fees, Excise Taxes, Etc. The Grantor agrees to pay
or to reimburse the Collateral Trustees for any and all amounts in respect of
all reasonable search, filing, recording and registration fees, taxes, excise
taxes and other similar imposts which may be payable or determined to be payable
in respect of the execution, delivery, performance and enforcement of this
Agreement and each Shared Collateral Document. The obligations of the Grantor
under this Section 6.05 shall survive the termination of this Agreement.
SECTION 6.06. Indemnification. (a) The Grantor agrees to pay, indemnify,
and hold harmless the Collateral Trustees and each of the agents of either
thereof from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever (including, without limitation, the costs and expenses
of defending any claim against any of them) with respect to the execution,
delivery, enforcement, performance and administration of this Agreement and the
Shared Collateral Documents unless and to the extent arising from the gross
negligence or willful misconduct of such of the Collateral Trustees or such of
the agents thereof as are seeking indemnification or any failure of any
Collateral Trustee or any such agent to exercise ordinary care in the handling
of moneys and securities and other property actually received by any such
Collateral Trustee or any such agent. As security for such payment, any such
Collateral Trustee shall have a prior lien upon all Collateral and other
property and funds held or collected by the Collateral Trustees as part of the
Collateral Trust Estate.
(b) In any suit, proceeding or action brought by the Collateral Trustees
under or with respect to any Shared Collateral Document or the Collateral for
any amount owing thereunder, or to enforce any provisions thereof, the Grantor
will save, indemnify and hold harmless the Collateral Trustees, the
Representatives and the Secured Holders from and against all expense, loss or
damage suffered by reason of any defense, set-off, counterclaim, recoupment or
reduction of liability whatsoever of the obligee thereunder (unless and to the
extent that such expense, loss or damage is caused by the gross negligence or
willful misconduct of the such Collateral Trustee or the failure of any
Collateral Trustee to exercise ordinary care in the handling of moneys and
securities and other property actually received by such Collateral Trustee),
arising out of a breach by the Grantor of any obligation thereunder or arising
out of any other agreement, indebtedness or liability at any time owing to or in
favor of such obligee or its successors from the Grantor and all such
obligations of the Grantor shall be and remain enforceable against and only
against the Grantor and shall not be enforceable against the Collateral
Trustees, any Representative or any Secured Holder. The agreements in this
Section 6.06 shall survive the termination of this Agreement.
SECTION 6.07. Further Assurances. (a) The Grantor agrees, from time to
time, at its own expense to execute, acknowledge, deliver, record, re-record,
file, re-file, register and re-register, and cause its Subsidiaries, if any, to
promptly execute, acknowledge, deliver, record, re-record, file, re-file,
register and re-register any and all such further acts, financing statements and
continuations thereof, notices of assignment, transfers, certificates,
assurances and other instruments as may be reasonably necessary or desirable, or
as any Collateral Trustee, any
20
16
Representative, any Secured Holder through its Representative, may reasonably
request from time to time in order (i) to carry out more effectively the
purposes or this Agreement, (ii) to subject to the liens and security interests
created by any of the Shared Collateral Documents any of the properties, rights
or interests of the Grantor covered or now or hereafter intended to be covered
by any of the Shared Collateral Documents, (iii) to perfect and maintain the
validity, effectiveness and priority of any of the Shared Collateral Documents
and the liens and security interests intended to be created thereby, (iv) to
better assure, convey, grant, assign, transfer, preserve, protect and confirm
unto the Collateral Trustees, the Representatives and the Secured Holders the
rights granted or now or hereafter intended to be granted to the Collateral
Trustees, the Representatives and the Secured Holders under any Shared
Collateral Document or under any other instrument executed in connection with
any Shared Collateral Document to which it is or may become a party, and (v) to
enable the Collateral Trustees to exercise and enforce their rights and remedies
hereunder and under each Shared Collateral Document with respect to any
Collateral; provided, however, that this Section 6.07 shall not be construed to
require the Grantor to grant any interest in Collateral other than pursuant to
this Agreement, the Credit Agreement or any Shared Collateral Document. Without
limiting the generality of the foregoing, the Grantor will take any such action
required to be taken by it pursuant to any Shared Collateral Document.
(b) The Grantor hereby authorizes the Collateral Trustees to file one or
more financing or continuation statements, and amendments thereto, relative to
all or any part of the Collateral without the signature of the Grantor where
permitted by law. A photocopy or other reproduction of this Agreement, any
Shared Collateral Document or any financing statement covering the Collateral or
any part thereof shall be sufficient as a financing statement where permitted by
law.
(c) The Grantor will furnish such information about the Collateral as
the Collateral Trustees may reasonably request from time to time.
ARTICLE VII
THE COLLATERAL TRUSTEE
SECTION 7.01. Declaration of Trust. Each of the Corporate Trustee and
the Individual Trustee, for itself and its successors, hereby accepts the trusts
created by this Agreement upon the terms and conditions hereof, including those
contained in this Article VII. Further, each of the Corporate Trustee and the
Individual Trustee, for itself and its successors, does hereby declare that it
will hold all of the estate, right, title and interest in (a) the Collateral
Trust Estate and the Collateral Account for the equal and ratable benefit of the
Representatives and the Secured Holders as provided herein, and (b) each account
as may be established pursuant to Section 5.02 at the request of a
Representative upon the trust herein set forth and for the benefit of such
Representative on behalf of its applicable Secured Holders as provided herein.
SECTION 7.02. Exculpatory Provisions. (a) The Collateral Trustees shall
not be responsible in any manner whatsoever for the correctness of any recitals,
statements, representations or warranties contained herein or in the Shared
Collateral Documents, all of which are made solely by the Grantor which is a
party thereto. The Collateral Trustees make no representations as to the value
or condition of the Collateral Trust Estate, the Collateral Account
21
17
or any part thereof, or as to the title of the Grantor thereto or as to the
security afforded by the Shared Collateral Documents or this Agreement, or as to
the validity, execution (except its own execution), enforceability, legality or
sufficiency of this Agreement, any Shared Collateral Document or any Secured
Agreement, and the Collateral Trustees shall incur no liability or
responsibility in respect of any such matters. The Collateral Trustees shall not
be responsible for insuring the Collateral Trust Estate or for the payment of
taxes, charges, assessments or liens upon the Collateral Trust Estate or
otherwise as to the maintenance of the Collateral Trust Estate or the Collateral
Account, except that in any event that any Collateral Trustee enters into
possession of a part or all of the Collateral Trust Estate, the Collateral
Account, such Collateral Trustee, shall preserve the part in its possession.
(b) The Collateral Trustees shall not be required to ascertain or
inquire as to the performance by the Grantor of any of the covenants or
agreements contained herein, in any other Shared Collateral Document or in any
Secured Agreement.
SECTION 7.03. Delegation of Duties. The Collateral Trustees may execute
any of the trusts or powers hereof and perform any duty hereunder either
directly or by or through agents or attorneys-in-fact (which shall not include
officers and employees of the Grantor or any Affiliate of the Grantor). The
Collateral Trustees shall be entitled to rely upon advice of reasonably selected
counsel and other professionals concerning all matters pertaining to such
trusts, powers and duties. The Collateral Trustees shall not be responsible for
the negligence or misconduct of any agents or attorneys-in-fact reasonably
selected by them in good faith.
SECTION 7.04. Reliance by Collateral Trustees. (a) Whenever in the
administration of the trusts of this Agreement or, pursuant to any other Shared
Collateral Document, the Collateral Trustees shall deem it necessary or
desirable that a matter be proved or established in connection with the taking,
suffering or omitting any action hereunder by the Collateral Trustees unless
otherwise provided herein, such matter (unless other evidence in respect thereof
be herein specifically prescribed) may be deemed to be conclusively proved or
established by a certificate of an Authorized Officer of the Grantor delivered
to the Collateral Trustees and the Representatives, and such certificate shall
constitute a full warranty to the Collateral Trustees for any action taken,
suffered or omitted in reliance thereon unless (i) the Collateral Trustees shall
have actual knowledge of an inaccuracy therein or (ii) any Representative shall
provide contrary information in writing with respect to such matter within 10
days of receipt thereof by such Representative, in which case unless such
Representative and the Grantor can reach agreement on such issue within a period
of 10 days, the Collateral Trustees shall appoint, at the expense of the
Grantor, an independent arbitrator (who shall be reasonably acceptable to the
Grantor and such Representative) to resolve the dispute.
(b) The Collateral Trustees may consult with independent counsel,
independent public accountants and other experts selected by it (excluding,
counsel to or any employee of the Grantor or any Affiliate of the Grantor) and
any opinion of such counsel shall be full and complete authorization and
protection in respect of any action taken or suffered by them hereunder in
accordance therewith unless such Collateral Trustee has actual knowledge of a
reason to question the validity or accuracy of such opinion or of any
assumptions expressed therein as the basis for such opinion. The Collateral
Trustees shall have the right at any time to seek instructions concerning the
administration of the Collateral Trust Estate or the Collateral
22
18
Account or any account established pursuant to Section 5.02 hereof from any
court of competent jurisdiction.
(c) The Collateral Trustees may rely, and shall be fully protected in
acting, upon any resolution, statement, certificate, instrument, opinion,
report, notice, request, consent, order, bond or other paper or document which
they reasonably believe to be genuine and to have been signed or presented by
the proper party or parties or, in the case of telecopies and telexes, to have
been sent by the proper party or parties. In the absence of its gross negligence
or willful misconduct, each Collateral Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed therein,
upon any notices, certificates or opinions furnished to such Collateral Trustee
that conform to the requirements of this Agreement or any Shared Collateral
Document.
SECTION 7.05. Limitations on Duties of the Trustees. (a) The Collateral
Trustees undertake to perform only the duties expressly set forth herein and no
implied covenant or obligation shall be read into this Agreement against the
Collateral Trustees.
(b) The Collateral Trustees may exercise the rights and powers granted
to them by this Agreement and the Shared Collateral Documents, but only pursuant
to the terms of this Agreement, and the Collateral Trustees shall not be liable
with respect to any action taken or omitted by them in accordance with the
direction of the Required Representatives.
(c) Except as herein otherwise expressly provided, the Collateral
Trustees shall not be under any obligation to take any action which is
discretionary with the Collateral Trustees under the provisions hereof or under
any Shared Collateral Document except upon the written request of the Required
Representatives. The Collateral Trustees shall make available for inspection and
copying by each Representative each certificate or other paper furnished to the
Collateral Trustees by the Grantor, by any Representative, or by any other
Person, under or in respect of this Agreement, any Shared Collateral Document or
any of the Collateral Trust Estate.
(d) The Collateral Trustees shall be under no obligation to exercise any
of the rights or powers vested in them by this Agreement or any other Shared
Collateral Document at the request or direction of any Representatives pursuant
to this Agreement, unless such Representatives shall have offered to the
Collateral Trustees security or indemnity satisfactory to the Collateral
Trustees against the costs, expenses and liabilities which might be incurred by
them in compliance with such request or direction.
SECTION 7.06. Moneys to Be Held in Trust. All moneys received by the
Corporate Trustee under or pursuant to any provision of this Agreement or any
Shared Collateral Document shall be segregated and held in trust for the
purposes for which they were paid or are held and the Corporate Trustee shall
exercise ordinary care in the handling of any such moneys actually received by
it. The Individual Trustee shall promptly turn over to the Corporate Trustee any
Collateral, or any part thereof, delivered to or received by the Individual
Trustee.
SECTION 7.07. Resignation and Removal of Collateral Trustees. (a) Each
or both of the Collateral Trustees may at any time, by giving 30 days' prior
written notice to the Grantor and the Representatives, resign and be discharged
of their responsibilities hereby
23
19
created, such resignation to become effective upon the appointment of a
successor trustee or trustees by the Required Representatives, the acceptance of
such appointment by such successor trustee or trustees and, unless an Actionable
Default has occurred and is continuing, the consent to the appointment of such
successor trustee or trustees by the Grantor. If an Actionable Default has
occurred, the Grantor's consent to any such resignation shall not be required.
The Collateral Trustees shall be entitled to their fees and expenses accrued to
the date of the resignation becoming effective. Either or both of the Collateral
Trustees may be removed at any time (with or without cause) and a successor
trustee or trustees appointed by the affirmative vote of the Required
Representatives, subject to, unless an Actionable Default has occurred and is
continuing, the consent of the Grantor, provided that the Collateral Trustees or
either of them shall be entitled to their fees and expenses accrued to the date
of removal. If either or both of the Collateral Trustees resigns or is removed
as provided in this Section 7.07 the consent to the appointment of a successor
trustee or trustees shall not be unreasonably withheld and shall be deemed to
have been given if the Grantor shall not have reasonably objected to any
proposed successor trustee or trustees within five Business Days of receipt of
notice of the identity thereof from the Representatives. If no successor trustee
or trustees shall be appointed and approved within 30 days from the date of the
giving of the aforesaid notice of resignation or within 30 days from the date of
such vote for removal, the Collateral Trustees, shall, or any Representative
may, apply to any court of competent jurisdiction to appoint a successor trustee
or trustees to act until such time, if any, as a successor trustee or trustees
shall have been appointed as above provided. Any successor trustee or trustees
so appointed by such court shall immediately and without further act be
superseded by any successor trustee or trustees approved by the Representatives
as above provided.
(b) If at any time either or both of the Collateral Trustees shall
become incapable of acting, or if at any time a vacancy shall occur in the
office of the Collateral Trustees for any other cause, a successor trustee or
trustees shall be promptly appointed by the Required Representatives, subject
to, unless an Actionable Default has occurred and is continuing, the consent of
the Grantor, which consent shall not be unreasonably withheld, and the powers,
duties, authority and title of the predecessor trustee or trustees terminated
and cancelled without procuring the resignation of such predecessor trustee or
trustees, and without any formality (except as may be required by applicable
law) other than appointment and designation of a successor trustee or trustees
in writing, duly acknowledged, delivered to the predecessor trustee or trustees
and the Grantor and filed for record in each public office, if any, in which
this Agreement is required to be filed.
(c) The appointment and designation referred to in Section 7.07(b)
shall, after any required filing, be full evidence of the right and authority to
make the same and of all the facts therein recited, and this Agreement shall
vest in such successor trustee or trustees, without any further act, deed or
conveyance, all of the estate and title of its predecessor, and upon such filing
for record the successor trustee or trustees shall become fully vested with all
the estates, properties, rights, powers, trusts, duties, authority and title of
its predecessor; but such predecessor shall, nevertheless, on the written
request of the Required Representatives, the Grantor or its successor trustee or
trustees, execute and deliver an instrument transferring to such successor all
the estates, properties, rights, powers, trusts, duties, authority and title of
such predecessor hereunder and shall deliver all securities and moneys held by
it or them to such successor trustee or trustees. Should any deed, conveyance or
other instrument in writing from
24
20
the Grantor be required by any successor trustee or trustees for more fully and
certainly vesting in such successor trustee or trustees the estates, properties,
rights, powers, trusts, duties, authority and title vested or intended to be
vested in the predecessor trustee or trustees, any and all such deeds,
conveyances and other instruments in writing shall, on request of such successor
trustee or trustees, be executed, acknowledged and delivered by the Grantor.
(d) Any required filing for record of the instrument appointing a
successor trustee or trustees as hereinabove provided shall be at the expense of
the Grantor. The resignation of any trustee or trustees and the instrument
removing any trustee or trustees, together with all other instruments, deeds and
conveyances provided for in this Article VII shall, if permitted by law, be
forthwith recorded, registered and filed by and at the expense of the Grantor,
wherever this Agreement is recorded, registered and filed.
SECTION 7.08. Status of Successors to Trustee. Every successor to the
Corporate Trustee appointed pursuant to Section 7.07 shall be a bank or trust
company in good standing and having power so to act, incorporated under the laws
of the United States or any State thereof or the District of Columbia and having
its principal corporate trust office within the State of Delaware, or another
state acceptable to the Required Representatives, and shall also have capital,
surplus and undivided profits of not less than $100,000,000, if there be such an
institution with such capital, surplus and undivided profits willing, qualified
and able to accept the trust upon reasonable or customary terms. Any successor
to the Individual Trustee appointed pursuant to Section 7.07 shall be an
individual residing in the State of Delaware, the State of New York or another
state of the United States acceptable to the Required Representatives.
SECTION 7.09. Merger of the Corporate Trustee. Any corporation into
which the Corporate Trustee may be merged, or with which it may be consolidated,
or any corporation resulting from any merger or consolidation to which the
Corporate Trustee shall be a party, shall be the Corporate Trustee under this
Agreement without the execution or filing of any paper or any further act on the
part of the parties hereto.
SECTION 7.10. Powers of Individual Trustee. The Individual Trustee has
been joined as a party hereunder so that if, by any present or future applicable
law in any jurisdiction in which it may be necessary to perform any act in the
execution or enforcement of the trusts hereby created, the Corporate Trustee may
be incompetent, unqualified or unable to act as a Collateral Trustee, then all
of the acts required to be performed in such jurisdiction, in the execution or
enforcement of the trusts hereby created, shall and will be performed by the
Individual Trustee, acting alone. Notwithstanding any other term or provision of
this Agreement to the contrary, the Corporate Trustee alone shall have and
exercise the rights and powers granted herein and shall be solely charged with
the performance of the duties herein declared on the part of the Collateral
Trustees to be had and exercised or to be performed without any action taken by
the Individual Trustee; provided, however, that if the Corporate Trustee or the
Required Representatives deem it necessary or desirable for the Individual
Trustee to act in a particular jurisdiction, the Individual Trustee shall have
and exercise the rights and powers granted herein (but no greater powers) and
shall be charged with the performance of the duties herein declared on the part
of the Collateral Trustees to be had and exercised or to be performed, but only
in such particular jurisdiction.
25
21
SECTION 7.11. Additional Co-Trustees; Separate Trustees. (a) If at any
time or times it shall be necessary or prudent in order to conform to any law of
any jurisdiction in which any of the Collateral shall be located, or the
Collateral Trustees shall be advised by counsel satisfactory to them that it is
so necessary or prudent in the interest of the Representatives on behalf of the
Secured Holders, or the Representatives shall in writing so request by notice to
the Collateral Trustees and the Grantor, or the Collateral Trustees shall deem
it desirable for their own protection in the performance of their duties
hereunder, or the Grantor shall in writing so request by notice to the
Collateral Trustees with the consent of the Representatives, the Collateral
Trustees and the Grantor shall execute and deliver all instruments and
agreements necessary or proper to constitute another bank or trust company, or
one or more persons approved by the Collateral Trustees, the Grantor and the
Representatives, either to act as co-trustee or co-trustees of all or any of the
Collateral, jointly with the Collateral Trustees originally named herein or any
successor, or to act as separate trustee of any such property. In the event the
Grantor shall not have joined in the execution of such instruments and
agreements within 10 days after the receipt of a written request from the
Collateral Trustees so to do, or in case an Actionable Default shall have
occurred and be continuing, the Collateral Trustees may act under the foregoing
provisions of this Section 7.11 without the concurrence of the Grantor (but with
the concurrence of the Required Representatives), and the Grantor hereby
appoints the Collateral Trustees as its agents and attorneys to act for it under
the foregoing provisions of this Section 7.11 in either of such contingencies.
(b) Any separate trustee and any co-trustee (other than any trustee
which may be appointed as successor to the Corporate Trustee or the Individual
Trustee pursuant to Section 7.07) shall, to the extent permitted by law, be
appointed and act and be such, subject to the following provisions and
conditions, namely:
(i) all rights, powers, duties and obligations conferred upon
the trustees in respect of the custody, control and management of
moneys, papers or securities shall be exercised solely by the Collateral
Trustees originally named herein or their successors appointed pursuant
to Section 7.07;
(ii) all rights, powers, duties and obligations conferred or
imposed upon the Collateral Trustees hereunder shall be conferred or
imposed and exercised or performed by the Collateral Trustees and such
separate trustee or co-trustee, jointly, as shall be provided in the
instrument appointing such separate trustee or co-trustee, except to the
extent that under any law of any jurisdiction in which any particular
act or acts are to be performed the Collateral Trustees shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations shall be exercised and
performed by such separate trustee or co-trustee;
(iii) no power given hereby to, or which it is provided hereby
may be exercised by, any such co-trustee or separate trustee, shall be
exercised hereunder by such co-trustee or separate trustee, except
jointly with, or with the consent in writing of, the Collateral
Trustees, anything herein contained to the contrary notwithstanding;
(iv) no trustee hereunder shall be personally liable by reason
of any act or omission of any other trustee hereunder; and
26
22
(v) the Grantor and the Collateral Trustees, at any time, by an
instrument in writing, executed by them jointly, may accept the
resignation of or remove any such separate trustee, and in that case, by
an instrument in writing executed by the Grantor and the Collateral
Trustees jointly, may appoint a successor (who shall be acceptable to
the Required Representatives) to such a separate trustee or co-trustee,
as the case may be, anything herein contained to the contrary
notwithstanding. In the event that the Grantor shall not have joined in
the execution of any such instrument within 10 days after the receipt of
a written request from the Collateral Trustees so to do, or in case an
Actionable Default shall have occurred and be continuing, the Collateral
Trustees shall have the power to accept the resignation of or remove any
such separate trustee or co-trustee and to appoint (with the consent of
the Required Representatives) a successor without the concurrence of the
Grantor and the Grantor hereby appoints the Collateral Trustees its
agents and attorneys to act for it in such connection in either of such
contingencies. In the event that the Collateral Trustees shall have
appointed a separate trustee or co-trustee or as above provided, they
may at any time, by an instrument in writing, accept the resignation of
or remove any such separate trustee, the successor to any such separate
trustee to be appointed by the Grantor and the Collateral Trustees, or
by the Collateral Trustees alone, as hereinbefore provided in this
Section 7.11.
SECTION 7.12. Trustees Appointed Attorneys-in-Fact. The Grantor hereby
irrevocably constitutes and appoints the Collateral Trustees and any officer or
agent thereof, with full power of substitution, as its true and lawful
attorneys-in-fact with full power and authority in the name of the Grantor or
their own name and in the place and stead of the Grantor and in the name of the
Grantor, from time to time at the direction of the Required Representatives, to
take, subject to Section 4.09, any action and to execute any instrument which
the same may deem necessary or advisable to accomplish the purposes of this
Agreement, including, without limitation, to receive, endorse and collect all
instruments made payable to the Grantor representing any dividend, interest
payment or other distribution in respect of the Collateral or any part thereof
and to give full discharge for the same in accordance with the terms of the
Shared Collateral Documents. The Grantor acknowledges and agrees that the
foregoing power of attorney is coupled with an interest and may not be revoked
or modified except with the consent of the Collateral Trustees or as otherwise
provided herein.
SECTION 7.13. Ordinary Care. The Collateral Trustees shall be deemed to
have exercised ordinary care in the custody and preservation of the Collateral
in their possession if the Collateral is accorded treatment substantially equal
to that which the Collateral Trustees accord their own property, and reasonable
care is exercised by the Collateral Trustees in handling any moneys or
securities or other property actually received by them, it being understood that
the Collateral Trustees shall not have any responsibility for (i) ascertaining
or taking action with respect to calls, conversions, exchanges, maturities,
tenders or other matters relative to any Collateral, whether or not the
Collateral Trustees have or are deemed to have knowledge of such matters, or
(ii) taking any necessary steps to preserve rights against any parties with
respect to any Collateral.
27
23
ARTICLE VIII
RELEASE OF COLLATERAL
SECTION 8.01. Partial Release of Collateral. (a) The Grantor may, from
time to time so long as no Actionable Default shall have occurred and be
continuing, request the release of the lien and security interest of the Shared
Collateral Documents in any portion of the Collateral of the Grantor proposed to
be sold or otherwise disposed of by the Grantor to any other Person, upon notice
to the Collateral Trustees from an Authorized Officer of the Grantor (a "NOTICE
OF PARTIAL RELEASE"), which Notice of Partial Release shall be delivered to the
Collateral Trustees and the Administrative Agent at least ten Business Days
prior to the date of the proposed sale or other disposition of such Collateral
(unless a shorter period of time is acceptable to the Collateral Trustees and
the Administrative Agent) and shall
(i) specify the Collateral to be so sold or otherwise disposed
of and the proposed date of such sale or other disposition, and
(ii) certify that the sale of other disposition of such
Collateral is in compliance with under the terms of the Secured
Agreements, and the Grantor or the Borrower is not, and after giving
effect to such release, would not be, in default under any of the
Secured Agreements.
If a Notice of Partial Release is delivered to the Collateral Trustees in
accordance with the immediately preceding sentence and the Administrative Agent,
on behalf of the Lenders, shall not have objected in writing thereto prior to
the date of the proposed release, the security interest in such Collateral shall
automatically, without further action, be released and the Collateral Trustees
shall execute and deliver to the Grantor, on the date of the proposed release
(or as promptly thereafter as possible), a release or releases (including,
without limitation, Uniform Commercial Code release statements and instruments
of satisfaction, discharge and/or reconveyance) in recordable form as to the
Collateral specified in such Notice of Partial Release from the liens, security
interests, conveyances and assignments evidenced by the Shared Collateral
Documents, which release shall state that it is effective as of the date of such
disposition; provided, however, that, if prior to the time that the Collateral
Trustees deliver a release pursuant to this Section 8.01(a), the Collateral
Trustees shall have received either (A) an Actionable Default Notice that shall
not have been withdrawn prior to such time and the Required Lenders shall have
directed the Collateral Trustees either not to deliver such a release or not to
deliver releases generally or (B) a written objection from the Administrative
Agent stating that such sale or other disposition is not permitted under the
Credit Agreement, then, in either case, the Collateral Trustees shall so notify
the Grantor and shall not sign any release or releases in connection with such
disposition.
(b) If, at any time, the Collateral Trustees shall receive a written
notice from an Authorized Officer of the Grantor, (i) stating that any
promissory note or other similar or related instrument evidencing obligations
payable to the Grantor and included in the Collateral has been paid in full in
accordance with its terms (or will be so paid concurrently with the surrender
thereof), and (ii) identifying such note or other instrument in reasonable
detail (including, without limitation, by its date of issuance, the name of its
payee and the principal
28
24
amount thereof), then the Collateral Trustees shall promptly deliver a copy of
each such notice to each Representative and, unless any Representative shall
have disputed the accuracy of such notice within five Business Days of the
delivery of such notice, the Collateral Trustees shall promptly deliver such
note or other instrument to the Grantor, and promptly execute and deliver a
release or releases (including, without limitation, Uniform Commercial Code
release statements) in recordable form as to any such note or other instrument
from the liens, security interests, conveyances and assignments evidenced by the
Shared Collateral Documents, which release shall state that it is effective as
of the date of its delivery.
SECTION 8.02. Full Release of Collateral Upon Satisfaction of Certain
Secured Obligations. (a) Unless an Actionable Default shall then have occurred
and be continuing, the Collateral Trustees shall promptly release in accordance
with Section 8.03 all the Collateral upon the cash payment in full of the
Secured Obligations arising under the Credit Agreement and the other Loan
Documents (as defined in the Credit Agreement).
(b) In furtherance of the undertaking set forth above in Section
8.02(a), the Collateral Trustees shall, upon the request of the Grantor
accompanied by a certificate of an Authorized Officer of the Grantor, upon which
the Collateral Trustees may conclusively rely without independent verification,
to the effect that all Secured Obligations under the Credit Agreement and the
other Loan Documents have been, or will, concurrently with the release of the
Collateral be, paid in full in cash and all commitment thereunder terminated
(and if such Secured Obligations have not previously been so paid, describing
the source(s) of funds for such repayment), deliver a notice by registered mail
(and immediately thereafter send via facsimile, a copy of such notice to the
Representatives, it being understood that the fax confirmation sheet shall
evidence the fulfillment of the Collateral Trustee's obligation in this
parenthetical) to the Administrative Agent (with a copy to each other
Representative) containing the following:
(i) a statement as to the total amount of moneys in the
Collateral Account and any account which has been established at the
request of any Representative pursuant to Section 5.02; and
(ii) a statement that the Collateral Trustees intend to release
all the Collateral unless they receive a written notice from the
Administrative Agent within 10 days saying that it has not received cash
payment in full of all the Secured Obligations owed to the Lenders under
the Credit Agreement and that all commitments of such Lenders thereunder
have not been terminated, or, if such Secured Obligations are to be
repaid and such commitments terminated concurrently with such release, a
statement that the Collateral Trustees will release such Collateral only
upon receipt from the Administrative Agent of instructions to do so.
If the Collateral Trustees do not receive a certificate from the Administrative
Agent within 10 days after the delivery of such notice stating that such Secured
Obligations have not been indefeasibly paid in full in cash (or such commitments
have not been terminated), or the Collateral Trustees receive a direction from
the Administrative Agent so to release such Collateral, as the case may be (and
the Collateral Trustees shall not have received any notice that an Actionable
Default has occurred or is continuing), then the Collateral Trustees shall
release all the Collateral from the security interest in their favor and deliver
to the Grantor all Collateral in
29
25
the possession of the Collateral Trustees promptly after the expiration of such
10 day period or as specified in such instruction, as the case may be; provided,
however, that the Grantor shall have made adequate provision for the expenses of
the Collateral Trustees associated with such release of Collateral and all other
expenses of, or payable to, the Collateral Trustees hereunder; and provided,
further, that the failure of the Administrative Agent to provide a certificate
to the Collateral Trustees pursuant to this Section 8.02 shall in no way be
deemed a waiver of, or otherwise impair in any way, its rights to receive
payment in respect of unpaid Secured Obligations. If the Collateral Trustees
shall have received such a certificate from the Administrative Agent within such
10 day period, or shall not have received an instruction so to release such
Collateral (or shall have received an Actionable Default Notice which has not
been withdrawn), as the case may be, the Collateral Trustees shall not release
the Collateral unless and until the Administrative Agent or a court of competent
jurisdiction so directs the Collateral Trustees pursuant to a final,
non-appealable judgment (including a judgment that becomes non-appealable by
reason of expiration of any period of time limiting the right to appeal
therefrom).
SECTION 8.03. Effect of Release of Collateral. Upon the effectiveness of
the release of the Collateral pursuant to Section 8.02, all right, title and
interest of the Collateral Trustees and the Representatives on behalf of the
Secured Holders in, to and under the Collateral Trust Estate, the Collateral and
the Shared Collateral Documents shall terminate and shall revert to the Grantor
and its successors and assigns, and the estate, right, title and interest of the
Collateral Trustees therein shall thereupon cease; and in such case, upon the
written request of the Grantor, its successors or assigns, and at the cost and
expense of the Grantor, its successors or assigns, the Collateral Trustees shall
promptly execute and deliver a satisfaction of the Shared Collateral Documents
and such instruments as are necessary or desirable to terminate and remove of
record any documents constituting public notice of the Shared Collateral
Documents and the security interests granted thereunder and shall transfer, or
cause to be transferred, and shall deliver or cause to be delivered to the
Grantor, all property, including all moneys, instruments and securities of the
Grantor then held by the Collateral Trustees. The cancellation and satisfaction
of the Shared Collateral Documents shall be without prejudice to the rights of
the Collateral Trustees or any successor trustee or trustees to charge and be
reimbursed for any expenditures which they may thereafter incur in connection
therewith.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Supplements and Waivers. (a) (i) With the
written consent of the Administrative Agent and the Corporate Trustee, the
Grantor may, from time to time, enter into written agreements supplemental
hereto for the purpose of adding to or waiving any provision of this Agreement
or any of the Shared Collateral Documents or changing in any manner the rights
of the Collateral Trustees, the Representatives, the Secured Holders and the
Grantor hereunder or thereunder.
(ii) No such amendment, waiver or consent shall, unless in writing and
signed by the Individual Trustee, amend, waive or otherwise modify any provision
of Section 7.10.
30
26
(iii) Any such supplemental agreement shall be binding upon the Grantor,
the Representatives, the Secured Holders and the Collateral Trustees and their
respective successors.
(iv) The Collateral Trustees shall not enter into any such supplemental
agreement unless they shall have received a certificate of an Authorized Officer
of the Grantor to the effect that such supplemental agreement will not result in
a breach of any provision or covenant contained in any of the Secured
Agreements.
(v) The Collateral Trustees shall not enter into any such supplemental
agreement unless they shall have received a certificate of the Administrative
Agent to the effect that, upon receipt of the Corporate Trustee's written
consent, this Section 9.01(a) has been complied with and an instruction letter
requesting the Corporate Trustee and Individual Trustee to execute such
supplemental agreement.
(b) Notwithstanding the provisions of paragraph (a), the Collateral
Trustees and the Grantor may, at any time and from time to time, without the
consent of the Administrative Agent and any other Representative or any Secured
Holders, enter into additional Shared Collateral Documents or one or more
agreements supplemental hereto or to any Shared Collateral Document, in form
satisfactory to the Collateral Trustees,
(i) to add to the covenants of the Grantor, for the benefit of
the Representatives or any Secured Holder, or to surrender any right or
power herein conferred upon the Grantor;
(ii) to mortgage, pledge or grant a security interest in favor
of the Collateral Trustees as additional security for the Secured
Obligations any property or assets which are required to be mortgaged or
pledged, or in which a security interest is required to be granted, to
the Collateral Trustees pursuant to any Shared Collateral Document or
otherwise; or
(iii) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Agreement which shall not be inconsistent
with the provisions of this Agreement, provided such action shall not
adversely affect the interests of the Secured Holders.
SECTION 9.02. Additional Actions of Representatives. Whether or not
there shall be an Actionable Default, the Collateral Trustees shall comply and
shall be fully protected in complying with any reasonable request of (a) the
Required Representatives, to take or refrain from taking certain actions with
respect to the Collateral or the Representatives, and (b) more than 50% of the
Secured Holders represented by any Representative which has requested that an
account be opened pursuant to Section 5.02, to take or refrain from taking
certain actions with respect to such account, provided, in each case, that the
Collateral Trustees shall not take or refrain from taking such actions if to do
so would violate applicable law or the terms of this Agreement, the Shared
Collateral Documents or the applicable Secured Agreements or if the Collateral
Trustees shall not be indemnified as provided in Section 6.06(b).
31
27
SECTION 9.03. Notices. All notices, requests, demands and other
communications provided for or permitted hereunder shall, unless otherwise
stated herein, be in writing (including telex and telecopy communications) and
shall be sent by mail (by registered or certified mail, return receipt
requested), overnight prepaid courier, telex, telecopier or hand delivery:
(a) If to the Grantor, to its address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇ ▇▇▇▇▇ (telecopy no.
▇▇▇-▇▇▇-▇▇▇▇) or at such other address as shall be designated by it in a
written notice to the Collateral Trustees;
(b) If to the Corporate Trustee, at ▇▇▇▇▇▇ Square North, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Corporate Trust
Division, or at such other address as shall be designated by it in a
written notice to the Grantor and each Representative, with a copy to
the Individual Trustee, at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Corporate Trust Division, or at such
other address as shall be designated by him in a written notice to the
Grantor and each Representative; provided that failure to send a copy of
any notice to the Individual Trustee shall not render any notice to the
Collateral Trustees ineffective; and
(c) If to any Representative, to it at the address specified
from time to time in the list provided by the Grantor to the Collateral
Trustees pursuant to Section 6.02 with copies to whomever (other than
the Grantor) is specified by the Grantor pursuant to Section 6.02 as a
Person to whom notice must be sent under the Secured Agreements,
provided that in the case that no address is known for a Representative,
notice shall be given to it in the manner specified by the related
Secured Agreement, and, in the absence of any such specified means of
giving notice, by such notice in the national edition of The Wall Street
Journal or as the Collateral Trustees shall determine to be reasonable.
For purposes of notice by publication, one notice is sufficient and
shall be deemed made on the date of its publication.
All such notices, requests, demands and communications shall be deemed to have
been duly given or made, (i) when delivered by hand, (ii) five Business Days
after being deposited in the mail, postage prepaid, (iii) the next Business Day
if delivered by an overnight prepaid courier, (iv) when telexed with answerback
received, (v) when telecopied or (vi) when published in The Wall Street Journal
or such other publication; provided, however, that any notice, request, demand
or other communication to the Collateral Trustees shall not be effective until
received by the Corporate Trustee and, provided, further, that any notice to the
Collateral Trustees from the Grantor shall be signed by an Authorized Officer,
unless otherwise specifically set forth herein.
SECTION 9.04. Headings. Section, subsection and other headings used in
this Agreement are for convenience only and shall not affect the construction of
this Agreement.
SECTION 9.05. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall not invalidate the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
32
28
SECTION 9.06. Treatment of Payee or Indorsee by Trustees. (a) The
Collateral Trustees may treat the registered Secured Holder of any registered
note, and the payee or indorsee of any note or debenture which is not
registered, as the absolute owner thereof for all purposes hereunder and shall
not be affected by any notice to the contrary, whether such promissory note or
debenture shall be past due or not.
(b) Any person, firm, corporation or other entity which shall be
designated as the duly authorized representative of one or more Representatives
to act as such in connection with any matters pertaining to this Agreement or
any Shared Collateral Document or the Collateral shall present to the Collateral
Trustees such documents, including, without limitation, opinions of counsel, as
the Collateral Trustees may reasonably require, in order to demonstrate to the
Collateral Trustees the authority of such person, firm, corporation or other
entity to act as the representative of such Representatives.
SECTION 9.07. Dealings with the Grantor. Upon any application or demand
by the Grantor to the Collateral Trustees to take or permit any action under any
of the provisions of this Agreement, the Grantor shall (unless otherwise waived
by the Collateral Trustees in writing) furnish to the Collateral Trustees a
certificate signed by an Authorized Officer stating that all conditions
precedent, if any, provided for in this Agreement relating to the proposed
action have been complied with, except that in the case of any such application
or demand as to which the furnishing of such documents is specifically required
by any provision of this Agreement relating to such particular application or
demand, no additional certificate need be furnished.
SECTION 9.08. Claims. This Agreement is made for the benefit of the
Representatives on behalf of the Secured Holders, and the Representatives may
from time to time enforce their rights as explicit beneficiaries hereunder.
SECTION 9.09. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of each of the parties hereto and shall inure to the
benefit of the Representatives on behalf of the Secured Holders and their
respective successors and assigns and nothing herein or in any Shared Collateral
Document is intended or shall be construed to give any other Person any right,
remedy or claim under, to or in respect of this Agreement, any Shared Collateral
Document, the Collateral, the Collateral Account or the Collateral Trust Estate
or any part thereof.
SECTION 9.10. Governing Law. The provisions of this Agreement creating a
trust for the benefit of the Representatives on behalf of the Secured Holders
and setting forth the rights, duties, obligations and responsibilities of the
Collateral Trustees hereunder shall be governed by and construed in accordance
with the laws of the State of Delaware, so long as Wilmington Trust Company
shall serve as Corporate Trustee hereunder. In all other respects, including,
without limitation, all matters governed by the Uniform Commercial Code, and if
Wilmington Trust Company shall cease to serve as Corporate Trustee hereunder,
this Agreement shall be governed by and construed in accordance with the laws of
the State of New York, except as otherwise required by mandatory provisions of
law.
33
29
SECTION 9.11. Effectiveness. This Agreement shall become effective on
the execution and delivery hereof and shall remain in effect so long as the
Collateral Trustees shall have any obligations hereunder.
SECTION 9.12. Reexecution of Agreement. This Agreement shall be
reexecuted at any time and from time to time, at the request of the Required
Representatives, with such changes in the form hereof (including, without
limitation, changes on the cover page and adding supplemental signatures and
notary statements) as may be necessary to comply with the filing or recording
requirements of any jurisdiction where this Agreement is to be filed.
SECTION 9.13. Effect on Credit Agreements. Nothing in this Agreement
shall operate or be deemed to prevent any amendment, modification or waiver of
the Credit Agreement or other Loan Documents (as defined in the Credit
Agreement) by the parties thereto in accordance with the terms thereof.
SECTION 9.14. Counterparts. This Agreement may be executed in separate
counterparts, each of which shall be an original and all of which taken together
shall constitute one and the same instrument.
34
IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
caused this Agreement to be duly executed by their respective officers thereunto
duly authorized as of the day and year first above written.
Corporate Trustee: WILMINGTON TRUST COMPANY, not in its
individual capacity, but solely as
Corporate Trustee
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Title: Vice President
Individual Trustee: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, not in his individual
capacity, but solely as Individual
Trustee
PACIFICARE HEALTH PLAN
ADMINISTRATORS, INC.,
an Indiana corporation, as Grantor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Title: Chief Financial Officer
