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AMENDED AND RESTATED MASTER
SECURITY AND ADMINISTRATION AGREEMENT
COMPUCOM SYSTEMS, INC.
NATIONSBANK OF TEXAS, N.A.,
IN ITS CAPACITY AS
ADMINISTRATIVE SECURED PARTY
NATIONSBANK OF TEXAS, N.A.,
IN ITS CAPACITY AS
ADMINISTRATIVE LENDER
CSI FUNDING, INC.
ENTERPRISE FUNDING CORPORATION
DATED AS OF SEPTEMBER 25, 1996
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TABLE OF CONTENTS
Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE ▇.
▇▇▇▇▇ OF SECURITY INTEREST;
APPOINTMENT OF ADMINISTRATOR; COLLATERAL COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . 11
1.1 Security Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.2 Administrative Secured Party Appointed as Administrator . . . . . . . . . . . . . . . 12
1.3 Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.4 Adjustment and Compromise of Receivables. . . . . . . . . . . . . . . . . . . . . . . 13
1.5 Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.6 Perfection and Protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.7 Examinations; Inspections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.8 Right to Cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.9 Preservation of Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.10 Special Rights; Power of Attorney . . . . . . . . . . . . . . . . . . . . . . . . . . 15
ARTICLE II.
COLLECTIONS ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.1 Administration of Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.2 Certification of RPA Interest and CompuCom Interest . . . . . . . . . . . . . . . . . 18
2.3 Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE III.
CLOSING REQUIREMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
3.1 Items to be Delivered by CompuCom . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE IV.
REPRESENTATIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
4.1 Corporate Name; Trade Names . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.2 Chief Executive Office. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.3 Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.4 Corporate Power and Authority; Validity . . . . . . . . . . . . . . . . . . . . . . . 22
4.5 No Conflicting Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.6 Compliance with Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.7 Judgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.8 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
4.9 Title to Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
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4.10 Consents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
4.11 Representations and Warranties Cumulative . . . . . . . . . . . . . . . . . . . . . . 23
ARTICLE V.
COVENANTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.1 Compliance Certificate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.2 Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.3 Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5.4 Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5.5 Monthly Receivables Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5.6 Notices, Information in Respect of RPA and TAA. . . . . . . . . . . . . . . . . . . . 24
5.7 Copies in Respect of RPA and TAA. . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5.8 Additional Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.9 Notification of Material Changes. . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.10 Notification Regarding Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.11 Compliance with Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.12 Payment of Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
5.13 Waivers and Consents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
5.14 Restriction on Disposition of Collateral. . . . . . . . . . . . . . . . . . . . . . . 26
5.15 Prohibition Against Liens on Collateral . . . . . . . . . . . . . . . . . . . . . . . 26
5.16 Covenants Cumulative. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
ARTICLE VI.
EVENT OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
6.1 Event of Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
ARTICLE VII.
REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
7.1 Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
7.2 Cash Collateral; Injunctive Relief. . . . . . . . . . . . . . . . . . . . . . . . . . 29
7.3 Application of Proceeds; Deficiency . . . . . . . . . . . . . . . . . . . . . . . . . 29
7.4 Waiver of Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
7.5 Setoff. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
7.6 Performance by Administrative Secured Party . . . . . . . . . . . . . . . . . . . . . 30
7.7 Non-waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
7.8 Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE VIII.
ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
8.1 Administration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
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ARTICLE IX.
ADDITIONAL AGREEMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
9.1 Equal Dignity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
9.2 Pro-Rata Treatment Among Beneficial Secured Parties . . . . . . . . . . . . . . . . . 40
9.3 Subordination of Interests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
9.4 Other Rights; Waiver of Marshaling. . . . . . . . . . . . . . . . . . . . . . . . . . 44
9.5 Access to Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
9.6 Payments by Administrative Secured Party. . . . . . . . . . . . . . . . . . . . . . . 44
9.7 Notices, Consents, Agreements Regarding EFC . . . . . . . . . . . . . . . . . . . . . 45
9.8 Limitation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE X.
MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.1 Effective Date; Term; Termination . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.2 Payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.3 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.4 Benefit to CompuCom . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
10.5 Administrative Secured Party. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
10.6 Exercise of Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
10.7 Administrative Secured Party's Records; Account Statements. . . . . . . . . . . . . . 48
10.8 Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
10.9 Interest Limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
10.10 Costs and Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
10.11 Acceptance and Performance; Venue . . . . . . . . . . . . . . . . . . . . . . . . . . 50
10.12 WAIVER OF TRIAL BY JURY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
10.13 Copies Valid as Financing Statements. . . . . . . . . . . . . . . . . . . . . . . . . 51
10.14 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
10.15 Entirety and Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
10.16 Parties Bound . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
10.17 Exhibits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
10.18 Descriptive Titles. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
10.19 Cumulative Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
10.20 Severability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
10.21 Multiple Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
10.22 Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
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EXHIBIT 10.3
AMENDED AND RESTATED MASTER
SECURITY AND ADMINISTRATION AGREEMENT
This Amended and Restated Master Security and Administration Agreement is
executed and entered into by and among COMPUCOM SYSTEMS, INC., a Delaware
corporation, NATIONSBANK OF TEXAS, N.A., a national bank, in its capacity as
Administrative Secured Party under this Agreement, NATIONSBANK OF TEXAS,
N.A., a national bank, in its individual corporate capacity, CSI FUNDING,
INC., a Delaware corporation, and ENTERPRISE FUNDING CORPORATION, a Delaware
corporation, effective as of September 25, 1996, as follows:
DEFINITIONS
The following definitions shall apply throughout this Agreement:
"ACCOUNT DEBTOR" means a Person that is obligated for payment of a
Receivable.
"ADMINISTRATION DOCUMENTS" means this Agreement, the Concentration Account
Agreement, any Lockbox Agreement, the NationsBank Account, the CompuCom
Account and the CFI Account, respectively, all financing statements in
respect of this Agreement, and any and all renewals, extensions,
modifications, amendments or restatements of any of the foregoing.
"ADMINISTRATIVE LENDER" means NationsBank of Texas, N.A., as
administrative lender for the ratable benefit of the Lenders under the
Credit Agreement, and its successors and assigns in such capacity.
"ADMINISTRATIVE SECURED PARTY" means NATIONSBANK OF TEXAS, N.A., a
national bank, in its capacity as Administrative Secured Party under this
Agreement, whose principal place of business is located at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇. When used throughout this
Agreement, "Administrative Secured Party" also includes Administrative
Secured Party's successors and any party to whom Administrative Secured
Party, or its successors, assigns its rights and interests under this
Agreement as allowed by, and pursuant to, paragraph 8.1(h).
"AGREEMENT" means this Master Security and Administration Agreement and
all exhibits and addenda, and any renewal, extension, amendment,
modification or restatement thereof.
"BENEFICIAL SECURED PARTY" means each of (i) NationsBank (until full
payment of all NationsBank Secured Obligations and termination of the
Credit Agreement, but not thereafter) and (ii) CFI (until termination of
the RPA and collection, or write-off by CFI, of all Receivables in which
an RPA Interest was transferred under the RPA, but not thereafter) and,
until termination of the TAA (but not thereafter), EFC as assignee of the
CFI Secured Obligations and a portion of the RPA Interest, as its interest
therein appears pursuant to the TAA, and its permitted assigns and any
Bank Investors (as defined therein); and in each case their legal
successors, respectively.
"BOOKS AND RECORDS" means all books, records, books or records of account,
files, journals, ledgers, correspondence, bank statements, registers,
logs, customer lists and related customer credit information, address or
telephone number lists, records of sales and payments made and received,
computer programs, discs, tapes, cards, software, printouts, systems and
other records, in whatever form, relating in any way to any of the
foregoing, and all other tangible and intangible media created, generated,
received, kept or otherwise used for recording actions, transactions and
other facts relating or pertaining to the Collateral.
"BUSINESS DAY" means any calendar day except Saturday, Sunday and those
days on which Administrative Secured Party is closed for business or which
are legal public holidays specified in 5 U.S.C. Section 6103(a), as may be
amended from time to time.
"CFI" means CSI Funding, Inc., a Delaware corporation and wholly owned
subsidiary of CompuCom, whose chief executive office and principal place
of business is located at ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇.
"CFI ACCOUNT" means account No. 1291795475 maintained by CFI at
NationsBank or any other demand deposit account maintained by CFI and
designated to Administrative Secured Party in writing as an account for
deposits by Administrative Secured Party pursuant to paragraph 2.1(c)(1).
"CFI SECURED OBLIGATIONS" means all obligations now or hereafter owing by
CompuCom to or for the benefit of CFI (or EFC as transferee of a portion
of the RPA Interest under the TAA) under the RPA, the TAA or this
Agreement, whether pursuant to their respective terms or as may otherwise
be determined by applicable law (in all events including, without
limitation, CompuCom's obligation to deliver, or cause to be delivered, to
Administrative Secured Party all
2
Collections for the benefit of the Beneficial Secured Parties as required
by this Agreement and the RPA and also including, to the extent (if any)
that the transactions under the RPA are recharacterized by a court of
competent jurisdiction to be a financing transaction, CompuCom's
obligations to repay any loans deemed made to it by CFI thereunder), and
all renewals, extensions, amendments, modifications or restatements
thereof.
"COLLATERAL" means collectively all Receivables, Related Security, and
Books and Records now owned and hereafter acquired by CompuCom, and all
proceeds thereof at any time arising.
"COLLATERAL ACCESS AND WAIVER AGREEMENT" means an agreement in form and
substance satisfactory to Administrative Secured Party pursuant to which,
among other things, the owner and landlord of any real property leased by
CompuCom where any Books and Records are located shall waive its rights,
if any, thereto and allow Administrative Secured Party to enter upon the
premises to inspect, use, copy, or remove same.
"COLLECTIONS" means all proceeds of Receivables in whatever form,
including without limitation money, electronic funds transfers or checks,
drafts, notes, or other instruments in payment of Receivables or otherwise
constituting proceeds of Receivables.
"COMPUCOM" means COMPUCOM SYSTEMS, INC., a Delaware corporation, with its
chief executive office located at ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇.
"COMPUCOM ACCOUNT" means account No. 0187100969 maintained by CompuCom at
NationsBank, or any other demand deposit account maintained by CompuCom
and designated to the Administrative Secured Party in writing as an
account for deposits by Administrative Secured Party pursuant to paragraph
2.1.
"COMPUCOM INTEREST" means, at any time, the undivided fractional ownership
interest in the Receivables other than the RPA Interest, which together
with the RPA Interest constitutes a one hundred percent (100%) ownership
interest.
3
"COMPUCOM INTEREST PERCENTAGE" means, at any time, the CompuCom Interest
expressed as a percentage of the sum of the CompuCom Interest and the RPA
Interest, which percentage at any time shall be as most recently certified
to Administrative Secured Party by CompuCom and CFI pursuant to paragraph
2.2(a) or paragraph 2.2(b), subject however, to paragraph 2.2(c) and
paragraph 2.2(d).
"CONCENTRATION ACCOUNT" means account No. 0187101017 maintained by
CompuCom at NationsBank, over which Administrative Secured Party alone has
power of withdrawal or transfer, for the direct deposit of Collections
and/or the transfer of Collections made to the Lockbox pursuant to the Con-
centration Account Agreement as prescribed by this Agreement.
"CONCENTRATION ACCOUNT AGREEMENT" means the agreement by and among
CompuCom, Administrative Secured Party and a depository bank acceptable to
Administrative Secured Party and the Beneficial Secured Parties under
which the Concentration Account is established and maintained with such
depository bank, in form and substance satisfactory to Administrative
Secured Party and containing such provisions as Administrative Secured
Party may require, including without limitation the following: (a) such
depository bank agrees to hold all funds from time to time deposited to
the Concentration Account as bailee for Administrative Secured Party; (b)
following an Event of Default hereunder and notice by the Administrative
Secured Party to such depository bank, CompuCom and such depository bank
agree that they shall have no power of withdrawal over the funds in the
Concentration Account; (c) such depository bank waives any right, claim or
interest in the Concentration Account, and funds on deposit therein, and
agrees that it shall neither claim nor exercise any right of offset,
banker's lien or other rights against such funds; (d) CompuCom agrees to
pay directly all costs and expenses of such depository bank associated
with the Concentration Account; and (e) CompuCom and such depository bank
agree that CompuCom may not terminate the Concentration Account or the
Concentration Account Agreement, without the prior written consent of
Administrative Secured Party.
"CONTRACT TERM" means the period beginning on the Effective Date and
ending on the earlier of (1) both (i) termination of the RPA and the TAA
and certification thereof to Administrative Secured Party by CompuCom and
the RPA Interest Owner and (ii) full payment and performance of the
NationsBank Secured Obligations and termination of the Credit Agreement,
and certification thereof to Administrative Secured Party by CompuCom and
NationsBank or (2) mutual
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agreement in writing signed by CompuCom, Administrative Secured Party
and each of the Beneficial Secured Parties.
"CREDIT AGREEMENT" means that certain Credit Agreement, dated September
25, 1996, between NationsBank and CompuCom, as the same may from time to
time be amended, supplemented or otherwise modified and in effect, which
Credit Agreement amends and restates that certain Financing and Security
Agreement dated effective as of August 4, 1993 between NationsBank and
CompuCom, as itself amended by the following: (i) the First Amendment to
Financing and Security Agreement dated effective as of ▇▇▇▇▇ ▇▇, ▇▇▇▇,
(▇▇) the Second Amendment to Financing and Security Agreement dated
effective as of December 12, 1994, (iii) the Third Amendment to Financing
and Security Agreement dated effective as of April 26, 1995, (iv) the
Fourth Amendment to Financing and Security Agreement dated effective as of
October 1, 1995, (v) Amendment 4A to Financing and Security Agreement dated
effective as of March 22, 1996 and (v) the Fifth Amendment to Financing
and Security Agreement dated as of April 1, 1996.
"EFC" means Enterprise Funding Corporation, a Delaware corporation.
"EFFECTIVE DATE" means the effective date specified in the preamble of
this Agreement.
"INDEMNIFIED CLAIMS" means any and all claims, demands, actions, causes of
action, judgments, obligations, liabilities, losses, damages and
consequential damages, penalties, fines, costs, fees, expenses and
disbursements (including without limitation, reasonable fees and expenses
of attorneys and other professional consultants and experts in connection
with investigation or defense) of every kind, known or unknown, existing
or hereafter arising, foreseeable or unforeseeable, which may be imposed
upon, threatened or asserted against, or incurred or paid by, any
Indemnified Person at any time and from time to time, because of,
resulting from, in connection with, or arising out of any transaction,
act, omission, event or circumstance in any way connected with the
Collateral or the Administration Documents (including enforcement, defense
or protection of any rights of Administrative Secured Party or the
Beneficial Secured Parties thereunder), including but not limited to
economic loss or property damage in connection with any act performed or
omitted to be performed under any Administration Documents, any breach by
CompuCom of any representation, warranty, covenant, agreement or condition
contained in any Administration Documents or any Event of Default as
defined in this Agreement. THE FOREGOING INCLUDES CLAIMS
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BASED UPON OR ARISING FROM ORDINARY NEGLIGENCE OF ANY INDEMNIFIED PERSON
BUT EXCLUDES CLAIMS BASED UPON OR ARISING FROM GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF ANY INDEMNIFIED PERSON.
"INDEMNIFIED PERSONS" collectively means Administrative Secured Party and
each of the Beneficial Secured Parties, and their respective officers,
directors, shareholders, employees, agents, attorneys and representatives,
and any person owned or controlled by, or which owns or controls or is
under common control or is otherwise affiliated with, any of them,
respectively, and any other person, if any, who acquires a portion of the
Collateral in any manner through exercise of rights and remedies under the
Administration Documents.
"LENDER" means any Person executing the Credit Agreement and named as a
lender thereunder, and its successors and assigns in such capacity.
"LOCKBOX" means a United States Post Office Box designated for the receipt
of Collections pursuant to a Lockbox Agreement.
"LOCKBOX AGREEMENT" means an agreement between Administrative Secured
Party and CompuCom designating a Lockbox for the receipt, deposit and
collection of Collections, in form and substance satisfactory to
Administrative Secured Party and containing provisions for the receipt of
Collections and daily deposit of same to the Concentration Account, and
such other provisions as Administrative Secured Party may require.
"MATERIAL ADVERSE EFFECT" means (i) a materially adverse effect on the
business, assets, operations, prospects or condition, financial or
otherwise, of CompuCom or (ii) material impairment of the ability of
CompuCom to perform any obligations under the Administration Documents or
(iii) material impairment of the enforceability of the rights and remedies
intended to be provided to Administrative Secured Party and the Beneficial
Secured Parties by this Agreement.
"MAXIMUM RATE" means the greater of (i) the "monthly ceiling" as referred
to and in effect from time to time under the provisions of Tex. Rev. Civ.
Stat. ▇▇▇. art. 5069-1.04(c), as amended, or (ii) the maximum rate of
interest permitted from day to day by any other applicable state or
federal law.
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"NATIONSBANK" means NationsBank of Texas, N.A., a national bank, in its
capacity as Administrative Lender for the ratable benefit of the several
Lenders named in the Credit Agreement, whose chief executive office and
principal place of business is located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, and its respective successors and assigns, including
specifically any party to whom NationsBank or its successors or assigns
may assign its rights and interests in any NationsBank Secured Obligations.
"NATIONSBANK SECURED OBLIGATIONS" means all "Obligations" defined in the
Credit Agreement (which definition is incorporated herein by reference,
and includes without limitation, all obligations and indebtedness now or
hereafter owing by CompuCom to the Administrative Lender and/or the
Lenders under or in connection with the Credit Agreement and all other
obligations and indebtedness from time to time owing by CompuCom to the
Administrative Lender and/or the Lenders), and all renewals, extensions,
amendments, modifications or restatements thereof.
"OWNERSHIP CERTIFICATION" means a written certification of the RPA
Interest Percentage and the CompuCom Interest Percentage, respectively,
jointly signed by the president, chief financial officer, treasurer or
controller of CompuCom and CFI, respectively, in form as appears in
Exhibit 2.2 or otherwise satisfactory to Administrative Secured Party,
delivered by CompuCom pursuant to paragraph 2.2.
"PERMITTED SUBORDINATED INTERESTS" means all interests in the Collateral
evidenced by (i) each of the Credit Agreement, the RPA and the TAA, in
each case, however, subject to the provisions of this Agreement as
provided by paragraph 9.3, and (ii) interests of IBM Credit Corporation
pursuant to the certain Agreement for Wholesale Financing dated August 27,
1991 between IBM Credit Corporation and CompuCom, as amended from time to
time, subject at all times, however, to the certain Amended and Restated
Intercreditor Agreement of even date herewith (the "IBM INTERCREDITOR
AGREEMENT") among IBM Credit Corporation, CompuCom, Administrative Secured
Party and NationsBank, as amended from time to time.
"PERSON" means any individual, corporation, joint venture, general or
limited partnership, trust, unincorporated organization or governmental
entity or agency.
7
"PRO RATA PERCENTAGE" means, with respect to any Receivable, a percentage
of such Receivable equal to (i) the CompuCom Interest Percentage in the
case of CompuCom or NationsBank, and (ii) the RPA Interest Percentage in
the case of CFI, or until termination of the TAA (but not thereafter), CFI
and EFC, collectively (as their respective interests in the RPA Interest
appear pursuant to the TAA).
"RECEIVABLES" means all of CompuCom's rights to payment from time to time
owing to CompuCom in connection with the sale of inventory or other goods,
or performance of services, by CompuCom (including without limitation,
accounts, chattel paper, instruments, contract rights and general
intangibles).
"RELATED SECURITY" means all security interests or liens, and all property
subject thereto, from time to time securing payment and performance of any
Receivable, and all guarantees, insurance or other agreements or
arrangements of any kind from time to time supporting or securing payment
of any Receivable and all returned goods the sale of which gave rise to
any Receivable (subject to the provisions of Section 9-306 of the Uniform
Commercial Code and the IBM Intercreditor Agreement).
"RPA" means the certain Receivables Purchase Agreement of even date
herewith between CompuCom and CFI providing for the sale by CompuCom to CFI
and the purchase by CFI from CompuCom (subject to the interests and rights
of the Administrative Secured Party under this Agreement) of an undivided
fractional ownership interest in all Receivables now owned and hereafter
acquired and arising from time to time prior to termination thereof, on
the terms provided therein, as the same may be renewed, extended,
modified, amended or restated from time to time.
"RPA INTEREST" means the undivided fractional ownership interest in the
Receivables that has been sold and transferred, and alternatively, in which
a security interest has been granted, by CompuCom to CFI pursuant to, and
which is the subject of, the RPA.
"RPA INTEREST OWNER" means CFI, and until termination of the TAA (but not
thereafter) also includes EFC, and its permitted assigns, as purchaser and
assignee of a portion of the RPA Interest pursuant to the TAA, as its
interest therein appears pursuant to the RPA.
8
"RPA INTEREST PERCENTAGE" means the RPA Interest expressed as a percentage
of the sum of the CompuCom Interest and the RPA Interest, which percentage
at any time shall be as most recently certified to Administrative Secured
Party by CompuCom and CFI pursuant to paragraph 2.2(a) or paragraph
2.2(b), subject however, to paragraph 2.2(c) and paragraph 2.2(d).
"SECURED OBLIGATIONS" collectively means (i) all obligations from time to
time owing by CompuCom to Administrative Secured Party under this
Agreement, (ii) the NationsBank Secured Obligations and (iii) the CFI
Secured Obligations, and any and all renewals or extensions thereof,
respectively.
"TAA" means the certain Transfer and Administration Agreement of even date
herewith among CFI, EFC, CompuCom and NationsBank, N.A. in its capacity as
Agent and a Bank Investor thereunder, providing for the transfer by CFI to
EFC and the acceptance by EFC from CFI of a portion of the RPA Interest,
from time to time, on the terms provided therein, as the same may be
renewed, extended, modified, amended or restated from time to time.
"TEXAS UCC" means the Texas Uniform Commercial Code as in effect on the
date of this Agreement and as it may hereafter be amended from time to
time.
All words and phrases used herein which are expressly defined in Section
1.201 or in Chapter 9 of the Texas UCC shall have the meaning provided for
therein. Other such words and phrases defined elsewhere in the Texas UCC
shall have the meanings specified therein except to the extent such meaning
is inconsistent with a definition in Section 1.201 or Chapter 9 thereof.
RECITALS
CompuCom, the Lenders and NationsBank are parties to the
Credit Agreement which provides for a credit facility for
loans by NationsBank and the Lenders to CompuCom, from time
to time, secured by (among other collateral) all of CompuCom's
Receivables now owned and hereafter acquired, on the terms
provided therein.
CFI is a special purpose, bankruptcy remote, wholly owned
subsidiary of CompuCom, formed and operating for the sole purpose
of entering into and performing (i) this
9
Agreement, (ii) the RPA, pursuant to which CompuCom will sell to
CFI and CFI will purchase from CompuCom, from time to time, the RPA
Interest, (iii) the TAA, pursuant to which CFI will transfer to
EFC and EFC will accept from CFI, from time to time, a portion of
the RPA Interest, and (iv) various related agreements.
CompuCom, NationsBank, CFI and EFC wish to establish a means
by which CompuCom may utilize its Receivables to access working
capital sources VIA both the Credit Agreement and the RPA, as
CompuCom shall determine in accordance with this Agreement, the
Credit Agreement and the RPA, and contemporaneous means by which
the interests of the Beneficial Secured Parties may be administered
on terms, and in a manner, mutually agreeable to Administrative
Secured Party, CompuCom and the Beneficial Secured Parties.
CompuCom and CFI intend that the transaction contemplated by
the RPA create an absolute transfer to CFI from CompuCom of the
RPA Interest in effect from time to time. In that regard, CFI has
entered into this Agreement to provide a means for administration
of the Receivables, the Related Security and Collections in a manner
consistent with its rights therein and the rights of NationsBank
therein. This agreement provides for the grant by CompuCom to
Administrative Secured Party, for the benefit of the Beneficial
Secured Parties as provided herein, of a security interest in the
Collateral as a whole (and not just the portion thereof as might
separately secure the NationsBank Secured Obligations) because CFI
has requested that, in the event of any possible recharacterization
by a court of competent jurisdiction of the transactions contemplated
by the RPA not as an absolute transfer to CFI of the RPA Interest
but rather as a financing (despite the expressed intent of CompuCom
and CFI), CFI have the equivalent benefit of a security interest in
that portion of the Receivables, the Related Security and the
Collections as might separately secure the payment to CFI of any loan
deemed to have been made to CompuCom
10
by CFI pursuant to any such recharacterization. As a means to
address administrative impracticabilities caused by the nature
of trade accounts receivable and intercreditor matters regarding
the rights of NationsBank on the one hand and CFI on the other, this
Agreement provides for the grant by CompuCom to Administrative
Secured Party, for the benefit of the Beneficial Secured Parties,
of a security interest in all of the Receivables, the Related
Security and the Collections, to secure both the CFI Secured
Obligations and the NationsBank Secured Obligations as well as to
provide for the administration of the Collateral in a manner which
is acceptable to all parties, consistent with CFI's rights therein
and the rights of NationsBank therein.
Therefore, the undersigned parties have determined to enter
into certain agreements and arrangements according to the terms
and provisions as set forth hereinbelow.
THEREFORE, for value received and other valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, and in consideration of the
mutual benefits provided herein, the undersigned parties hereby agree as
follows:
ARTICLE ▇.
▇▇▇▇▇ OF SECURITY INTEREST;
APPOINTMENT OF ADMINISTRATOR; COLLATERAL COVENANTS
I.1 SECURITY INTEREST.
▇. ▇▇▇▇▇ OF SECURITY INTEREST. CompuCom hereby
grants to Administrative Secured Party, for the benefit of the
Beneficial Secured Parties according to their respective Pro
Rata Percentages, a continuing security interest, collateral
assignment and lien in and to the Collateral to secure full
payment and performance of the Secured Obligations.
b. PRIORITY. Subject to paragraph 9.3, the security
interest, collateral assignment and lien in the Collateral
granted to Administrative Secured Party for the benefit of
Beneficial Secured Parties under this Agreement at all times
shall be and remain first, prior and senior to any other
interests in the Collateral. CompuCom represents to
Administrative
11
Secured Party that no other security interests, liens, financing
statements or other encumbrances exist or shall be allowed to
exist with respect to any of the Collateral, except the
Permitted Subordinated Interests and perfected rights, if any,
in returned inventory in favor of any Person who is a seller of
inventory to CompuCom, existing as of the Effective Date.
I.2 ADMINISTRATIVE SECURED PARTY APPOINTED AS ADMINISTRATOR. The
Beneficial Secured Parties hereby appoint Administrative Secured Party as
administrator to collect, receive and administer all Collections, on the
Beneficial Secured Parties' joint behalf, as provided by Article II and in
accordance with the other provisions of this Agreement. Until termination of
this Agreement (i) each Beneficial Secured Party irrevocably appoints
Administrative Secured Party as its nominee and attorney in fact with full
power coupled with an interest, to exercise and enforce any and all rights or
remedies in respect of its interests in the Receivables, whether under this
Agreement, the FSA (in the case of NationsBank), the RPA (in the case of
CFI), the TAA (in the case of CFI or EFC), or otherwise. Administrative
Secured Party may exercise or refrain from exercising any and all such rights
or remedies as it may determine in its discretion as provided, and subject
to, the provisions of Article VIII, subject to all other terms of this
Agreement, and all Collections received by Administrative Secured Party in
the exercise of any such rights or remedies shall be deemed received for the
benefit of the Beneficial Secured Parties according to their respective Pro
Rata Percentages as of the time of receipt thereof and administered according
to the provisions of Article II and the other provisions of this Agreement.
The rights delegated and appointed to Administrative Secured Party under this
paragraph 1.2 are separate, distinct and independent of Administrative
Secured Party's rights as a secured party arising under paragraph 1.1(a).
I.3 RECEIVABLES. CompuCom hereby represents, warrants and agrees
as follows (such representations, warranties and covenants being deemed made
daily by CompuCom to Administrative Secured Party for the benefit of the
Beneficial Secured Parties until this Agreement has been terminated): (a)
CompuCom is the sole owner of and has full unrestricted power and right to
grant to Administrative Secured Party a continuing security interest,
collateral assignment and pledge of all Receivables free from any lien,
security interest or encumbrance, other than Permitted Subordinated
Interests; (b) each Receivable is in existence, unconditional and valid, and
arose from a bona fide outright sale of inventory or performance of services
in the ordinary course of business, for liquidated amounts and maturing as
set forth on its face and such inventory has been shipped to, or such
services have been performed for, the respective Account Debtors; (c) no
Receivable is or will be subject to any sale, assignment, claim or security
interest of any character, other than the Permitted Subordinated Interests,
and CompuCom will not make any sale or other assignment thereof or create any
other security interest
12
therein; (d) except as disclosed to Administrative Secured Party in writing,
CompuCom has no knowledge that any Receivable is subject to any claim for
credit, deduction, allowance or adjustment by an Account Debtor, or to any
defense, dispute, setoff or counterclaim, and no extension or indulgence has
been granted by CompuCom with respect thereto; and (e) CompuCom believes and
expects that each Receivable will be paid in full at maturity. CompuCom
represents, warrants and confirms that the existing security interest in
certain inventory previously granted by CompuCom to each of Apple Computer,
Inc. and Compaq Computer Corporation, respectively, in each case, is limited
by agreement such that the security interest in proceeds of such inventory is
limited only to cash proceeds and insurance proceeds and excludes all other
proceeds (it being understood that CompuCom has, prior to the date hereof,
delivered to Administrative Secured Party a written statement from each such
secured party confirming that its security interest in proceeds of such
inventory is so limited), and CompuCom agrees that, for so long as this
Agreement is in full force and effect, it will not enter into any inventory
agreement with any Person unless, prior to the effectiveness of such
inventory agreement, CompuCom limits the interest of such Person in the
proceeds of inventory in the manner specified in this sentence.
I.4 ADJUSTMENT AND COMPROMISE OF RECEIVABLES. CompuCom agrees
that it will not settle, adjust, compromise, discharge or extend the time for
payment of any Receivable except in compliance with CompuCom's credit policy
and involving an amount not in excess of $2,000,000.00, without
Administrative Secured Party's consent.
I.5 BOOKS AND RECORDS. CompuCom represents and warrants to
Administrative Secured Party that all Books and Records are located at
CompuCom's chief executive office designated for CompuCom in the
"Definitions" of this Agreement, and at such other locations, if any, as may
be specified in Exhibit 1.5. CompuCom agrees that it will not maintain any
Books and Records at any location other than as designated in Exhibit 1.5
unless it gives Administrative Secured Party at least 30 days prior written
notice and first executes such financing statements and other documents as
Administrative Secured Party may request in connection therewith, PROVIDED
that, if any such location is a leased location CompuCom shall first cause
each owner or landlord thereof to execute and deliver to Administrative
Secured Party a Collateral Access and Waiver Agreement. CompuCom shall
immediately notify Administrative Secured Party upon receipt of any notice
from any Person claiming past due rent, fees or other charges in respect of
any material location where any Books and Records are located. CompuCom will
not deliver possession of any Books and Records to any Person (other than
pursuant to valid judicial process) without the prior written consent of
Administrative Secured Party.
13
I.6 PERFECTION AND PROTECTION. CompuCom shall perform, at its
expense, all action requested by Administrative Secured Party at any time to
perfect, maintain, protect, and enforce Administrative Secured Party's
security interests in the Collateral, including without limitation executing
and filing financing statements and amendments thereof, in form and substance
satisfactory to Administrative Secured Party; delivering to Administrative
Secured Party any proceeds of Collateral the possession of which is required
for continued perfection of Administrative Secured Party's security
interests, duly endorsed or assigned to Administrative Secured Party without
restriction, as may be required for such purpose; placing notations on books
of account to disclose Administrative Secured Party's security interests; and
such other steps as are deemed necessary by Administrative Secured Party to
maintain its security interests. So long as this Agreement is in effect and
until all Secured Obligations have been fully satisfied, Administrative
Secured Party's security interest and lien hereunder shall continue in full
force and effect in all Collateral.
I.7 EXAMINATIONS; INSPECTIONS. Administrative Secured Party or
its designee shall have the right, upon at least two (2) days' prior notice,
without hindrance or delay and during normal business hours, to examine and
inspect the Collateral. Administrative Secured Party is authorized to
discuss CompuCom's affairs with any employees of CompuCom, as Administrative
Secured Party may deem necessary in relation to the Collateral. CompuCom
agrees to pay Administrative Secured Party's customary fees and disbursements
relating to any such examinations or inspections. Administrative Secured
Party shall have full access to all records available to CompuCom from any
credit reporting service, bureau or similar service and shall have the right
to examine and make copies of any such records. Administrative Secured Party
may exhibit a copy of this Agreement to such service and such service shall
be entitled to rely on the provisions hereof in providing access to
Administrative Secured Party as provided herein.
I.8 RIGHT TO CURE. Administrative Secured Party in its sole
discretion may pay any amount or take any action in order to preserve,
protect and maintain the Collateral and Administrative Secured Party's
security interest therein, including without limitation, payment of any
landlord's claim or other encumbrance or claim asserted against the
Collateral (PROVIDED that with respect to any payment or obligation owing by
CompuCom to any Person other than Administrative Party, CompuCom shall have
first had the opportunity to make any such payment or perform any such
obligation). All such payments and all out-of-pocket costs and expenses made
or incurred by Administrative Secured Party shall be payable by CompuCom to
Administrative Secured Party on demand. Any payment made or other action
taken by Administrative Secured Party under this paragraph shall be without
prejudice to any right to assert an Event of Default or exercise any other
remedy hereunder.
14
I.9 PRESERVATION OF RIGHTS. To the extent allowed by law, neither
Administrative Secured Party nor any of its officers, directors, employees,
and agents shall be liable or responsible in any way for the safekeeping of
any Collateral or for any act or failure to act with respect to the
Collateral, or for any loss or damage thereto or any diminution in the value
thereof, or for any act by any other Person. In the case of any instruments
and chattel paper included within any proceeds of the Collateral,
Administrative Secured Party shall have no duty or obligation to preserve
rights against prior parties. The Secured Obligations shall not be affected
by any failure of Administrative Secured Party to take any steps to perfect
its security interests or to collect or realize upon the Collateral, nor
shall loss of or damage to the Collateral release CompuCom from any of the
Secured Obligations. Unless otherwise expressly agreed by Administrative
Secured Party and the Beneficial Secured Parties, no (i) modification or
amendment of the terms of any Administration Documents, (ii) compromise,
forbearance or grant of renewals, extensions, indulgences or releases with
respect to any Administration Documents, the Collateral or the Secured
Obligations or (iii) other action with respect to the Collateral or any
Person directly or indirectly obligated in connection therewith shall impair
the Secured Obligations, or Administrative Secured Party's or the Beneficial
Secured Parties' interests in the Collateral or any rights under the
Administration Documents.
I.10 SPECIAL RIGHTS; POWER OF ATTORNEY. CompuCom hereby
irrevocably appoints Administrative Secured Party as CompuCom's agent and
attorney-in-fact, for the benefit of the Beneficial Secured Parties, from
time to time in Administrative Secured Party's discretion, to take any action
necessary to preserve and protect the Collateral and Administrative Secured
Party's interests under the Administration Documents. CompuCom hereby
authorizes and appoints Administrative Secured Party as attorney in fact to
sign and file any financing statement or other document necessary to perfect
Administrative Secured Party's security interest in the Collateral.
Administrative Secured Party shall have the right at any time to take any of
the following actions, in its own name or in the name of CompuCom, if an
Event of Default is in existence: (i) make written or verbal requests for
verification of amounts owing on Receivables from any or all Persons which
Administrative Secured Party believes may be an Account Debtor; (ii) take
possession and control of Collections; (iii) redirect the deposit and
disposition of Collections; (iv) endorse the name of CompuCom on checks,
instruments constituting Collections; (v) prepare, sign and file, on behalf
of CompuCom in CompuCom's name or in Administrative Secured Party's name as
assignee, any notice of lien, or any proof of claim or other document in any
bankruptcy proceedings of any Account Debtor; (vi) access, copy or utilize
any information recorded or contained in any computer or data processing
equipment or system in respect of the Receivables maintained by CompuCom
15
or any affiliate, or to which CompuCom has access; (vii) enter onto
CompuCom's premises and discuss CompuCom's affairs with CompuCom's personnel
as may be reasonably necessary in connection with maintaining or enforcing
Administrative Secured Party's rights under the Administration Documents;
(viii) access and utilize the information recorded on or contained in any
data processing equipment and computer hardware and software relating to the
Receivables or other Collateral to which CompuCom has access; and (ix) take
all other action allowed by law as may be necessary to carry out the
Administration Documents and give effect to Administrative Secured Party's
rights thereunder. In addition, Administrative Secured Party shall have the
right to take any of the following actions, in its own name or in the name of
CompuCom, at any time when any Event of Default is in existence, whether or
not Administrative Secured Party has taken any action to exercise any
remedies under the Administration Documents: (x) notify any Person which
Administrative Secured Party believes may be an Account Debtor to make
payments directly to Administrative Secured Party; (xi) settle, adjust,
compromise or discharge Receivables or extend time of payment upon such terms
as Administrative Secured Party may determine; (xii) take action in
Administrative Secured Party's name or CompuCom's name to enforce collection
of Receivables; (xiii) open mail addressed to CompuCom to take possession of
and dispose of checks or other proceeds of Receivables in accordance with
this Agreement; and (xiv) direct the U.S. Postal service to change the
address to which CompuCom's mail is delivered. Should Administrative Secured
Party at any time elect to exercise its right of verification or notification
with respect to the Receivables as provided in clause (i) or clause (x)
above, respectively, Administrative Secured Party shall have the right in its
sole discretion to direct such request for verification, or notification, as
the case may be, to all Persons which Administrative Secured Party believes
may have transacted business with CompuCom at any time, whether or not such
Persons are then indebted to CompuCom, and Administrative Secured Party is
hereby released and discharged from any liability by reason of any such
request for verification or notification. Costs and expenses incurred by
Administrative Secured Party in connection with any of such actions by
Administrative Secured Party, including reasonable attorneys' fees and
out-of-pocket expenses, shall be reimbursed by CompuCom to Administrative
Secured Party on demand.
16
ARTICLE II.
COLLECTIONS ADMINISTRATION
II.1 ADMINISTRATION OF COLLECTIONS. Unless otherwise expressly
agreed in writing by Administrative Secured Party and the Beneficial Secured
Parties:
(a) CompuCom will instruct each Account Debtor to address
all remittances in payment of Receivables to the Lockbox or the
Concentration Account and will cause all invoices evidencing
Receivables to be noted with a legend stating that payment thereon
is to be made to CompuCom at the Lockbox or the Concentration Account.
(b) All Collections received in the Lockbox shall be deposited
daily to the Concentration Account.
(c) Unless and until agreed otherwise by Administrative
Secured Party and the Beneficial Secured Parties, all deposits to the
Concentration Account shall be disbursed simultaneously by
Administrative Secured Party as follows (subject to prior payment of
Secured Obligations due and payable by CompuCom to Administrative
Secured Party as provided by the Administration Documents):
If no Event of Default has occurred:
(1) If CFI elects not to reduce the Net Investment
under the TAA, or if the Net Investment under the TAA is not
otherwise required to be reduced pursuant to the terms thereof,
a percentage of each dollar thereof equal to the product of
the Purchase Discount (as defined in the RPA) and the RPA
Interest Percentage as of the time of disbursement shall
be deposited to the CFI Account; and
(2) If CFI elects not to reduce the Net Investment
under the TAA, or if the Net Investment under the TAA is not
otherwise required to be reduced pursuant to the terms thereof,
a percentage of each dollar thereof equal to one minus the
product of the Purchase Discount (as defined in the RPA) and the
RPA Interest Percentage as of the time of disbursement shall be
deposited to the CompuCom Account for the benefit of CFI in
satisfaction of certain of its obligations under the RPA.
17
(3) If CFI elects to reduce the Net Investment under
the TAA, or if the Net Investment under the TAA is otherwise
required to be reduced pursuant to the terms thereof, a
percentage of each dollar thereof as designated by CFI (up to
a maximum percentage equal to the RPA Percentage) at the time
of disbursement shall be deposited to the CFI Account and
(ii) after giving effect to the deposit described in clause
(i), a percentage of each dollar equal to one minus such
percentage at the time of disbursement shall be deposited to
the CompuCom Account for the benefit of CFI in satisfaction of
certain of its obligations under the RPA.
If an Event of Default has occurred and is continuing:
(1) A percentage of each dollar thereof equal to the
RPA Interest Percentage as of the time of disbursement shall
be deposited to the CFI Account; and
(2) A percentage of each dollar thereof equal to the
CompuCom Interest Percentage as of the time of disbursement
shall be deposited to the CompuCom Account; PROVIDED that at
all times following receipt by the Administrative Secured
Party of written instructions from the Administrative Lender,
all such funds described in this paragraph 2 shall be disbursed
by the Administrative Secured Party in accordance with such
written instructions.
(a) All Collections at all times shall be subject to an
express trust in favor of Administrative Secured Party for the
benefit of the Beneficial Secured Parties. Following an Event
of Default, CompuCom will not use, dispose of, withhold or
otherwise exercise dominion over any Collections. CompuCom agrees
that it will not commingle proceeds of Collections with any
other funds, and that no deposits will be made to the Lockbox or the
Concentration Account other than Collections. All amounts from time
to time deposited to the Lockbox or the Concentration Account are
for the benefit of the Beneficial Secured Parties and shall remain
subject to Administrative Secured Party's interests under this
Agreement.
18
.1 Certification of RPA Interest and CompuCom Interest.
(a) INITIAL CERTIFICATION. On or after the
Effective Date CompuCom shall deliver to Administrative Secured
Party an Ownership Certification, dated effective as of a
specified Business Day (which shall be on or after the date of
delivery thereof) therein certifying the RPA Interest Percentage
and the CompuCom Interest Percentage, respectively, as of such
day. On and after the specified effective date of such initial
Ownership Certification, the RPA Interest Percentage and the
CompuCom Interest Percentage each shall be deemed to be as
specified in such Ownership Certification, and Administrative
Secured Party shall be entitled to rely thereon in connection
with its administration of this Agreement until such time, if
any, as any subsequent Ownership Certification is actually
delivered to Administrative Secured Party and becomes effective
as provided in paragraph 2.2(b).
(b) AFTER THE EFFECTIVE DATE. Subject to at
least two Business Days' prior written notice to Administrative
Secured Party of its intention to do so (unless otherwise agreed
by the Administrative Secured Party after consultation with EFC),
CompuCom may effect a change in the RPA Interest Percentage and
the CompuCom Interest Percentage, for purposes of this Agreement,
by delivering to Administrative Secured Party an Ownership
Certification, dated as of a Business Day subsequent to
expiration of such notice period, therein certifying the RPA
Interest Percentage and the CompuCom Interest Percentage,
respectively, as of such day. Provided that no Event of Default
is then in existence and PROVIDED FURTHER, that any such change
in the CompuCom Interest Percentage and the RPA Interest
Percentage to be effected thereby does not create an Event of
Default, such Ownership Certification shall become effective as
of the day in the future specified therein (which shall be on or
after the beginning of the third Business Day following the
Business Day of Administrative Secured Party's receipt of the
foregoing notice), whereupon the RPA Interest Percentage and the
CompuCom Interest Percentage each shall be deemed to be as
specified therein, and Administrative Secured Party shall be
entitled to rely thereon in connection with its administration of
this Agreement until such time, if any, as any subsequent
Ownership Certification is actually delivered to Administrative
Secured Party and becomes effective as provided in this paragraph
2.2(b).
(c) UPON AND FOLLOWING TERMINATION OF RPA.
Notwithstanding any Ownership Certification, the RPA Interest
Percentage in all Receivables created on or after the effective
date of any termination of the RPA automatically shall be
19
zero percent (0.00%) and the CompuCom Interest Percentage therein
shall be one hundred percent (100.00%). At Administrative
Secured Party's option in its sole discretion, Administrative
Secured Party may cause all Collections received in respect of
Receivables created on or after the effective date of termination
of the RPA to be segregated and deposited to a separate account
for collection and transfer to the NationsBank Account in
accordance with paragraph 2.1(c)(2). It is understood and agreed
that the RPA Interest Percentage in effect at the time of any
such termination of the RPA shall remain in effect as to all
Receivables created prior to the effective time of any such
termination of the RPA.
(d) RECEIVABLES SUBJECT TO RECONVEYANCE.
Notwithstanding any Ownership Certification, the RPA Interest
Percentage in Receivables, if any, with respect to which the RPA
Interest is reconveyed in full by CFI to CompuCom pursuant to the
RPA, at any time, shall be zero percent (0.0%) and the CompuCom
Percentage Interest therein shall be one hundred percent
(100.0%). CompuCom and CFI shall notify Administrative Secured
Party and NationsBank in writing prior to effecting any such
reconveyance, therein describing the Receivable(s) which are to
be the subject thereof. At Administrative Secured Party's
request, CompuCom will assist Administrative Secured Party in
identifying Collections in respect of such Receivables and, at
Administrative Secured Party's option in its discretion,
Administrative Secured Party may cause all Collections at any
time received in respect of such Receivables to be segregated and
deposited to a separate account for collection and transfer to
the NationsBank account in accordance with paragraph 2.1(c)(2).
20
.2 FEES.
In order to compensate Administrative Secured
Party for its administration of the Administration Documents,
CompuCom agrees to pay to Administrative Secured Party, for its
own account, an administration fee of $37,500 per year payable
monthly in advance on the last Business Day of each month.
ARTICLE I.
CLOSING REQUIREMENTS
I.1 ITEMS TO BE DELIVERED BY COMPUCOM. Prior to or
simultaneously with execution and delivery hereof, CompuCom shall
deliver, or cause to be delivered, to Administrative Secured
Party the following:
(a) SECRETARY'S CERTIFICATE. A certificate in form
satisfactory to Administrative Secured Party, signed by the
corporate secretary of CompuCom and authenticated by the
president of CompuCom, attaching and certifying the following:
1. ARTICLES OF INCORPORATION AND CERTIFICATE
OF EXISTENCE. A copy of the articles of incorporation, and all
amendments thereto, of CompuCom, accompanied by the certificate
of the Secretary of State of Delaware and bearing a date no more
than thirty (30) days prior to the date hereof, to the effect
that such copy is correct and complete and that CompuCom is a
corporation duly incorporated and validly existing in such state.
2. GOOD STANDING. A certification by the appropriate
official of the State of Delaware bearing a date no more than thirty
(30) days prior to the date hereof, to the effect that CompuCom is in
good standing in such state with respect to payment of franchise and
similar taxes, and a certification by the Comptroller of Public Accounts
of the State of Texas bearing a date no more than thirty (30) days
prior to the date hereof confirming that CompuCom is duly qualified to
transact business in the State of Texas, bearing a date no more
than thirty (30) days prior to the date hereof confirming that
CompuCom is duly qualified to transact business in such state.
21
3. BYLAWS. A correct and complete copy of the bylaws
of CompuCom, and all amendments thereto.
4. INCUMBENCY. Certification of the name and signature
of all incumbent corporate officers of CompuCom authorized to act on
behalf of CompuCom in respect of the Administration Documents.
5. RESOLUTIONS. A copy of corporate resolutions of
CompuCom approving the Administration Documents and authorizing the
transactions contemplated hereby, and authorizing and directing a named
officer or officers to sign and deliver all Administration Documents to
be executed by CompuCom, duly adopted by its board of directors, including
the certificate of CompuCom's corporate secretary, dated the date hereof,
that such copy is a true and complete copy of resolutions duly adopted by
the board of directors, and that such resolutions have not been amended,
modified, or revoked in any respect and are in full force and effect as of
the date hereof.
(b) ADMINISTRATION DOCUMENTS. This Agreement and all other
Administration Documents, duly executed.
(c) FINANCING STATEMENTS. All financing statements required by
Administrative Secured Party in connection with perfection of Administrative
Secured Party's security interests in the Collateral.
(d) COLLATERAL ACCESS AND WAIVER AGREEMENTS. All Collateral
Access and Waiver Agreements, if any, as may be required by Administrative
Secured Party pursuant to paragraph 1.5.
(e) OPINION OF COMPUCOM'S COUNSEL. An opinion of counsel for
CompuCom in form and substance satisfactory to Administrative Secured Party,
addressing such matters in connection with this Agreement as Administrative
Secured Party may request.
(f) OTHER DOCUMENTS. Such other items as Administrative Secured
Party may request in order to perfect or protect its interests and rights
under the Administration Documents.
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ARTICLE II.
REPRESENTATIONS
II.1 CORPORATE NAME; TRADE NAMES. CompuCom is conducting,
transacting, and carrying on its business under the name shown
for CompuCom in the Definitions of this Agreement, and such other
names, if any, as may be specified in Exhibit 4.1, and is not
engaged in business under any other name. Except as provided in
Exhibit 4.1, during the past five (5) years CompuCom has not (i)
done business under any other name, (ii) been party to a merger
or consolidation or (iii) acquired any of the property included
within the Collateral from any other Person.
II.2 CHIEF EXECUTIVE OFFICE. CompuCom's chief executive
office is located at the address specified for CompuCom in the
Definitions of this Agreement.
II.3 CORPORATE EXISTENCE. CompuCom is a corporation, duly
incorporated, validly existing, and in good standing under the
laws of the State of Delaware, and is duly qualified or licensed
to transact business in all jurisdictions the laws of which
require it to be so qualified or licensed, except for those
jurisdictions, if any, where the failure to be so qualified or
licensed would not cause a Material Adverse Effect.
II.4 CORPORATE POWER AND AUTHORITY; VALIDITY. CompuCom
possesses all requisite authority and power and authority to
conduct to own, lease and operate its properties and to carry on
its business as now conducted and proposed to be conducted and to
execute, deliver, and comply with the Administration Documents.
Each of the Administration Documents has been duly authorized by
all necessary corporate action and duly executed and delivered by
CompuCom, and evidences valid and binding obligations enforceable
in accordance with its respective terms.
II.5 NO CONFLICTING AGREEMENTS. CompuCom represents that
the execution, delivery and performance of the Administration
Documents will not violate its articles of incorporation or
bylaws, nor constitute a default under, or result in a breach of,
any material contract, agreement, or other instrument to which it
is a party or which is applicable to its property.
II.6 COMPLIANCE WITH LAWS. CompuCom represents that it is
not in violation of any laws, regulations and orders in any
respect which will result in or cause, or reasonably would be
expected to result in or cause, a Material Adverse Effect.
23
II.7 JUDGMENTS. There are no outstanding or unpaid material
judgments or assessments against CompuCom, except for tax and
similar assessments in the ordinary course of business which are
not delinquent.
II.8 TAXES. All tax returns or filings required to be filed
by CompuCom have been filed and taxes imposed upon CompuCom which
are due and payable have been paid.
II.9 TITLE TO PROPERTY. CompuCom has good and indefeasible
title to all Collateral.
II.10 CONSENTS. No governmental orders, permissions,
consents, approvals or authorizations are required to be obtained
and no registrations or declarations are required to be filed in
connection with the execution, delivery and performance of the
Administration Documents other than financing statements required
by Administrative Secured Party under the Texas UCC. CompuCom
has all required governmental permits and licenses, if any, on
account of its operations and activities and is in full
compliance with the terms and conditions thereof, and all such
permits and licenses are in full force and effect.
II.11 REPRESENTATIONS AND WARRANTIES CUMULATIVE. The
representations and warranties contained in this Article IV are
in addition to all other representations and warranties provided
in the Administration Documents.
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ARTICLE III.
COVENANTS
Throughout the Contract Term, CompuCom agrees as follows
(unless otherwise allowed by prior written consent of
Administrative Secured Party):
III.1 COMPLIANCE CERTIFICATE. Within forty five (45)
days following the end of each fiscal quarter of CompuCom,
CompuCom shall deliver to Administrative Secured Party a
certificate signed by the president or chief financial officer,
controller or treasurer of CompuCom certifying to Administrative
Secured Party that, except as may be expressly identified and
described in such certificate, CompuCom is in compliance with its
obligations under this Agreement and that no event or condition
that would be the subject of a required notice under paragraph
5.7, paragraph 5.8 or paragraph 5.9 is in existence as of the
date of such certificate. Such certificate shall be deemed to be
a continuing representation and warranty pending any subsequent
certification or notification by CompuCom respecting its
compliance or non-compliance with this Agreement.
III.2 AUTHORITY. Immediately following any effective
change thereof (and at such other times, from time to time, at
the request of Administrative Secured Party) CompuCom shall
certify to Administrative Secured Party the names and signatures
of all Persons authorized to execute and deliver to
Administrative Secured Party any documentation contemplated by or
relating to any Administration Documents.
III.3 BOOKS AND RECORDS. CompuCom shall keep and
maintain proper, complete and consistent books of record and
account respecting the Collateral and CompuCom's affairs in
accordance with GAAP.
III.4 CORPORATE EXISTENCE. CompuCom shall preserve and
maintain its corporate existence, good standing and authority to
transact business in all jurisdictions where necessary for the
proper conduct of its business, and shall maintain all of its
properties, rights, privileges and franchises necessary or
desirable in the normal conduct of its business.
III.5 MONTHLY RECEIVABLES REPORT. Within 15 days after
the end of each calendar month, CompuCom shall furnish to
Administrative Secured Party and the Beneficial Secured Parties a
listing and analysis of all Receivables substantially in the form
attached as Exhibit E to the TAA.
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III.6 NOTICES, INFORMATION IN RESPECT OF RPA AND TAA.
CompuCom and CFI will notify Administrative Secured Party and the
Beneficial Secured Parties in writing (i) at least two (2)
Business Days before effecting any change in the RPA Interest
under the terms of the RPA, as provided in paragraph 2.2(b),
(ii) promptly upon any termination of the RPA or the TAA, or upon
receiving or sending any notice of intended, pending or potential
termination of the RPA or the TAA, (iii) promptly at any time
when the Percentage Factor exceeds the Maximum Percentage Factor
(as those terms are defined by the TAA); (iv) promptly upon any
assignment by EFC, or any request by CFI for an assignment by
EFC, of EFC's interest under the TAA to any Bank Investor
pursuant to Section 9.7 of the TAA.
III.7 COPIES IN RESPECT OF RPA AND TAA. Promptly upon
execution, CompuCom will deliver to Administrative Secured Party
and the Beneficial Secured Parties a true and correct copy of the
RPA and the TAA, respectively, and all other agreements,
certifications, opinions and other documentation in connection
therewith. CompuCom will provide Administrative Secured Party
and the Beneficial Secured Parties with a true and correct copy
of (i) each Ownership Certification delivered to Administrative
Secured Party, (ii) each monthly report delivered by CompuCom to
CFI under the RPA; (iii) each Investor Report delivered by
CompuCom to EFC under the TAA; (iv) each notice, if any, at any
time given by CFI pursuant to Section 5.1(b)(i) of the TAA
(notifications in respect of Termination Events or Potential
Termination Events, as those terms are defined by the TAA) and
(v) any notice of termination, or of intended, pending or
potential termination of the RPA or the TAA sent or received by
CompuCom or CFI.
III.8 ADDITIONAL INFORMATION. In addition to
information and items specifically required by the Administration
Documents, CompuCom shall promptly furnish to Administrative
Secured Party such other information or documentation respecting
the Collateral, and its business affairs in connection therewith,
as Administrative Secured Party may reasonably request.
III.9 NOTIFICATION OF MATERIAL CHANGES. CompuCom shall
promptly notify Administrative Secured Party of any change in any
other material fact or circumstance represented or warranted in
any of the Administration Documents. Without limitation,
CompuCom will notify Administrative Secured Party in writing at
least thirty (30) days prior to the occurrence of any of the
following: (i) change of CompuCom's name, (ii) change of the
location of CompuCom's chief executive office, or (iii) use of
any trade name, fictitious name or other assumed name not
disclosed to Administrative Secured Party at the time of
execution of this Agreement.
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III.10 NOTIFICATION REGARDING DEFAULT. CompuCom shall
immediately notify Administrative Secured Party and the
Beneficial Secured Parties in writing upon becoming aware of the
existence of any condition or event which constitutes an Event of
Default or any condition or event which, after notice or lapse of
time, or both, would constitute an Event of Default, therein
specifying the nature and period of existence thereof and what
action CompuCom is taking or proposes to take with respect to
such condition or event. CompuCom shall immediately notify
Administrative Secured Party and the Beneficial Secured Parties
in writing if it knows, or reasonably expects, that an Event of
Default will occur, therein specifying the nature of the
anticipated Event of Default. CompuCom will immediately notify
Administrative Secured Party and the Beneficial Secured Parties
if CompuCom is aware that any covenant under this Agreement has
been breached, or reasonably expects that any such covenant will
be breached, or if CompuCom's board of directors authorizes the
filing by CompuCom of a petition in bankruptcy.
III.11 COMPLIANCE WITH LAWS. CompuCom shall comply with
all applicable laws, regulations and orders applicable to it or
its property, a violation of which would reasonably be expected
to result in a Material Adverse Effect.
III.12 PAYMENT OF TAXES. CompuCom shall promptly pay, or
cause to be paid, when due, all assessments, taxes, governmental
charges and levies imposed upon CompuCom or its income or
profits, the non payment of which could give rise to any notice
of tax lien, levy or other lien or process against any of the
Collateral, except such as may be contested in good faith by
appropriate proceedings, PROVIDED, that adequate reserves shall
be maintained as are appropriate according to GAAP. CompuCom
shall promptly pay any amounts adjudged to be due pursuant to any
such contest, with all costs, penalties, and interest thereon,
before such judgment becomes final or any writ or order is issued
under which the Collateral, or any portion thereof, may become
subject to any lien or encumbrance. Promptly upon Administrative
Secured Party's request, CompuCom will furnish to Administrative
Secured Party evidence of payment of all such contested amounts
and will authorize the appropriate governmental official to
deliver to Administrative Secured Party at any time a written
statement of any taxes or other such amounts owing by CompuCom.
III.13 WAIVERS AND CONSENTS. CompuCom shall furnish to
Administrative Secured Party such waivers and consents as may
reasonably be requested by Administrative Secured Party with
respect to Administrative Secured Party's security interests and
liens in the Collateral.
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III.14 RESTRICTION ON DISPOSITION OF COLLATERAL.
CompuCom will not sell or dispose of any interest in the
Collateral except pursuant to the RPA.
III.15 PROHIBITION AGAINST LIENS ON COLLATERAL. CompuCom
will not grant, create or allow to exist any security interest,
lien, financing statement or other encumbrance on any Collateral
other than (i) under this Agreement, or (ii) the Permitted
Subordinated Interests. CompuCom will take prompt action as may
be necessary to discharge or dismiss any tax lien notice,
judgment, levy, attachment or other process filed or levied
against any of the Collateral.
III.16 COVENANTS CUMULATIVE. The covenants contained in
this Article V are in addition to all other covenants provided in
the Administration Documents.
ARTICLE IV.
EVENT OF DEFAULT
IV.1 EVENT OF DEFAULT. Each of the following shall
constitute an Event of Default on any day under this Agreement:
(a) Any Event of Default defined by the Credit
Agreement;
(b) Any default or breach by CompuCom of any
obligation under the RPA;
(c) Any Termination Event defined by the TAA;
(d) Any violation, breach or default of any
covenant, agreement or other obligation under the Administration
Documents which shall not have been cured or otherwise waived in
accordance with the terms of the Administration Documents;
(e) Any representation or warranty made by CompuCom in
the Administration Documents was false in any material respect at
the time when made, and such representation and warranty shall
not have been cured or waived in accordance with the terms of the
Administration Documents;
(f) Material impairment of the enforceability of
the interests, rights or remedies granted to Administrative
Secured Party or the Beneficial Secured
28
Parties under this Agreement, or the taking of any action by any
party to this Agreement to repudiate or challenge same.
29
ARTICLE V.
REMEDIES
30
V.1 REMEDIES. Should an Event of Default occur at any
time, Administrative Secured Party may at its option take any or
all of the following actions: (a) notify Account Debtors to make
all payments on Receivables directly to Administrative Secured
Party at such address as Administrative Secured Party shall
designate; (b) make demand for payment on Account Debtors and
take action (including without limitation, filing suit) to
enforce payment of Receivables, in the name of Administrative
Secured Party (on behalf of the Beneficial Secured Parties) or
CompuCom, as Administrative Secured Party shall determine in its
discretion; (c) take any other action to enforce the collection
rights of a secured party under the Texas UCC; and (d) exercise,
enforce and avail itself of any and all other rights or remedies
as may be available under this Agreement or any other
Administration Documents or as otherwise may be available under
the Texas UCC or other applicable law. Administrative Secured
Party at all times shall have the collection rights and all other
rights and remedies of a secured party under the Texas UCC,
including but not limited to the right to take possession of
Collections and enforce direct payment of Receivables. To the
extent necessary to protect and enforce its rights under the
Administration Documents, Administrative Secured Party is
expressly authorized to receive, open, and dispose of mail
addressed to CompuCom and endorse notes, checks, drafts, money
orders, or other evidences of payment, on behalf of and in the
name of CompuCom. Administrative Secured Party may demand,
collect, receipt for, settle, compromise, adjust, ▇▇▇ for,
foreclose or otherwise realize upon the Receivables as
Administrative Secured Party may determine in its discretion. In
collecting or pursuing collection of Receivables, Administrative
Secured Party may utilize CompuCom's books and records, premises,
telephones, telecopiers, copiers, and other facilities, or the
services of CompuCom's personnel, at CompuCom's cost and expense,
as may be necessary for prompt and expedient collection.
CompuCom agrees that Administrative Secured Party's use of such
facilities or personnel is a commercially reasonable method of
pursuing timely collection and enforcement of Receivables and
that, in taking any such action, Administrative Secured Party is
acting solely in its capacity as a secured party under the Texas
UCC and as attorney in fact and administrator, as provided by
this Agreement. Administrative Secured Party may give verbal or
written notice to any Person who Administrative Secured Party
reasonably believes is or may be an Account Debtor on Receivables
and thereby demand payment of all amounts which may be or become
due by such Person on Receivables. In taking possession of any
Collateral, Administrative Secured Party is authorized to enter
upon any premises owned or leased by CompuCom where any
Collateral is located. At its option, Administrative Secured
Party may require CompuCom to assemble the Collateral and make it
available to Administrative Secured Party at a place to be
designated by Administrative Secured Party which is reasonably
convenient to both Administrative Secured Party and CompuCom.
CompuCom agrees that Administrative Secured Party shall be
entitled to collect or dispose of any Collateral on CompuCom's
premises. Unless the Collateral is perishable
31
or threatens to decline speedily in value or is of a type
customarily sold on a recognized market, Administrative Secured
Party will give CompuCom reasonable notice of the time and place
of any public sale of Collateral or of the time after which any
private sale or any other intended disposition thereof is to be
made. For this purpose, it is agreed that at least five (5)
days notice of the time of sale or other intended disposition of
Collateral delivered in accordance with paragraph 10.3 shall be
deemed to be reasonable notice in conformity with the Texas UCC.
Administrative Secured Party may adjourn or otherwise reschedule
any public sale by announcement at the time and place specified
in the notice of such public sale, and such sale may be made at
the time and place as so announced without necessity of further
notice. Administrative Secured Party shall not be obligated to
sell or dispose of any Collateral, or to pursue any particular
manner of collection or disposition, notwithstanding any prior
notice of intended disposition. With respect to any instruments
or chattel paper at any time included within the Collateral,
Administrative Secured Party shall not have any duty or
obligation to take steps to preserve rights against prior
parties.
V.2 CASH COLLATERAL; INJUNCTIVE RELIEF. All cash proceeds
of Collateral from time to time existing, including without
limitation all Collections, at all times shall be and remain
subject to Administrative Secured Party's continuing security
interest, lien and administration under this Agreement, and shall
be subject to an express trust for the benefit of Administrative
Secured Party, for the benefit of the Beneficial Secured Parties.
Except as may be specifically allowed otherwise by this
Agreement, and following an Event of Default, CompuCom is
expressly prohibited from using, spending, retaining or otherwise
exercising any dominion over such proceeds, and all such proceeds
shall be promptly turned over to Administrative Secured Party in
the form in which they are received by CompuCom, either by
mailing or delivering the same to Administrative Secured Party
not later than the Business Day following receipt thereof by
CompuCom. CompuCom acknowledges and agrees that an action for
damages against CompuCom for any breach of the prohibitions and
obligations of this paragraph shall not be an adequate remedy at
law. In the event of any such breach, CompuCom agrees, to the
fullest extent allowed by law, that Administrative Secured Party
shall be entitled to injunctive relief to restrain such breach
and require compliance with the requirements of this Agreement.
V.3 APPLICATION OF PROCEEDS; DEFICIENCY. After deducting
all costs, fees and expenses of collection and enforcement for
which CompuCom is obligated to Administrative Secured Party
pursuant to the Administration Documents or applicable law, any
remaining Collections or other proceeds of collection, sale or
disposition of the Collateral shall be deposited to the
Concentration Account and administered according to paragraph
2.1(c), and the excess, if any, remaining after expiration of the
Contract Term shall be held or disbursed by Administrative
Secured Party by mutual agreement among
32
CompuCom, Administrative Secured Party and the Beneficial Secured
Parties or, in the absence of such mutual agreement, in accordance
with applicable law. CompuCom expressly agrees that it shall
remain liable for all Secured Obligations, if any, remaining after
liquidation or other disposition of the Collateral (PROVIDED, that
the foregoing shall not be construed to create any liability of
CompuCom under the RPA except as expressly provided therein).
V.4 WAIVER OF NOTICES. CompuCom expressly waives any
notices from Administrative Secured Party or the Beneficial
Secured Parties except as otherwise expressly provided for and
required by this Agreement.
V.5 SETOFF. CompuCom irrevocably authorizes Administrative
Secured Party to charge any account of CompuCom maintained with
Administrative Secured Party with such amount as may be necessary
from time to time to pay any Secured Obligations. CompuCom
agrees that Administrative Secured Party shall have a contractual
right to setoff any and all deposits or other sums at any time
credited by or due from Administrative Secured Party to CompuCom
against any part of the Secured Obligations. Such right of
setoff may be exercised at any time by Administrative Secured
Party without prior notice, irrespective of whether an Event of
Default exists or whether the Secured Obligations have fully
matured; PROVIDED that the Administrative Secured Party shall
promptly notify CompuCom following any such setoff of funds.
Upon the occurrence of an Event of Default and for so long as the
same shall remain in existence and is not cured or waived,
Administrative Secured Party shall be entitled in its discretion,
without prior notice, to hold any such deposits or other sums
(and return checks or other items presented for payment against
same, and otherwise deny access to same) pending acceleration of
any Secured Obligations. All amounts, if any, charged or set off
by Administrative Secured Party against any Collections shall be
deposited to the Concentration Account and administered as
provided by paragraph 2.1(c).
V.6 PERFORMANCE BY ADMINISTRATIVE SECURED PARTY. Should
CompuCom fail to perform any covenant, duty, or agreement
required by the Administration Documents (including without
limitation, payment and discharge of any taxes, liens or
encumbrances affecting or potentially affecting the Collateral)
Administrative Secured Party may in its sole discretion perform
or attempt to perform or cause performance of same on behalf of
CompuCom at CompuCom's reasonable cost and expense, PROVIDED that
Administrative Secured Party shall have no obligation or duty to
take any such action. CompuCom agrees to reimburse
Administrative Secured Party for such reasonable out-of-pocket
costs and expenses on demand and until paid.
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V.7 NON-WAIVER. Forbearance or indulgence by
Administrative Secured Party of any Event of Default or any other
event or condition which is or would be the subject of a required
notice under paragraph 5.10, at any time from time to time, shall
not be deemed a waiver of any rights of Administrative Secured
Party under the Administration Documents. The acceptance by
Administrative Secured Party or the Beneficial Secured Parties,
at any time and from time to time, of any partial payment of the
Secured Obligations shall not be deemed to be a waiver of any
Event of Default then existing. No delay or omission by
Administrative Secured Party in exercising any right or remedy
shall impair such right or remedy, or be construed as a waiver
thereof, nor shall any single or partial exercise of any such
rights or remedies preclude other or further exercise thereof.
Administrative Secured Party shall not be required or obligated
to file suit or otherwise pursue any Account Debtor or other
Person for enforcement or collection of any Receivables or to
otherwise take any action to realize upon any of the Collateral.
V.8 REMEDIES CUMULATIVE. The remedies specified in this
Article VII are cumulative with and in addition to all other
rights and remedies provided by this Agreement and the other
Administration Documents, or by applicable law.
34
ARTICLE VI.
ADMINISTRATION
VI.1 ADMINISTRATION. Administrative Secured Party, each of
the Beneficial Secured Parties and CompuCom each agrees as
follows:
35
(a) ADMINISTRATIVE SECURED PARTY: APPOINTMENT;
POWERS. Subject to the terms of this Agreement, each of the
Beneficial Secured Parties hereby irrevocably appoints and
authorizes Administrative Secured Party to act as nominee on
behalf of itself and any of the other Beneficial Secured Parties,
in the name of Administrative Secured Party, the Beneficial
Secured Parties or any of them, to take any one or more of the
following actions: Administer the Administration Documents in
accordance with their terms, and act or refrain from acting under
the Administration Documents in accordance with powers delegated
to Administrative Secured Party under the Administration
Documents and such other powers as are reasonably incidental
thereto; execute and enter into the Administration Documents;
hold the Administration Documents; hold and enforce the security
interests and liens in the Collateral granted under the
Administration Documents; exercise and enforce rights and
remedies in respect of the Receivables as attorney-in-fact and
administrator as provided by paragraph 1.2; receive all
documents, certifications, opinions and other items furnished by
CompuCom under the Administration Documents; take actions as may
be requested or instructed by the Beneficial Secured Parties
(PROVIDED, that unless the Administration Documents specifically
require or permit direction or consent by the Beneficial Secured
Parties and, in such event, unless further assurance of
indemnification (if requested by Administrative Secured Party) is
furnished as provided by paragraph 8.1(g), Administrative Secured
Party shall not be obligated to comply with any such
instructions); collect, receive and administer Collections as
provided by this Agreement; distribute to the Beneficial Secured
Parties such information, requests and documents received from
CompuCom pursuant to the Administration Documents; and deliver to
CompuCom requests, demands, approvals and consents as required or
allowed under the Administration Documents. Except as otherwise
expressly provided by the Administration Documents, each of the
Beneficial Secured Parties irrevocably authorizes Administrative
Secured Party to take or refrain from taking such actions on the
Beneficial Secured Parties' behalf as Administrative Secured
Party in its discretion determines necessary or appropriate in
administering the Administration Documents. Except as otherwise
provided by this Agreement, Administrative Secured Party may take
such action, or refrain from taking such action, in respect of
the Collateral, or in respect of administration of the
Administration Documents, as it may deem in its discretion to be
advisable in the performance of its obligations under this
Agreement. Unless otherwise agreed by Administrative Secured
Party, any action taken by Administrative Secured Party with the
consent or at the direction of the Beneficial Secured Parties
shall be deemed to have been taken for and on behalf of each of
the Beneficial Secured Parties. Administrative Secured Party
shall not be required to take action or exercise any remedy
except to the
36
extent expressly required by this Agreement upon
direction of the Beneficial Secured Parties, PROVIDED, that
Administrative Secured Party shall not be required to take any
action which Administrative Secured Party believes would expose
it or any of the Beneficial Secured Parties to personal
liability, or which Administrative Secured Party believes is
contrary to any of the Administration Documents or applicable
law. Administrative Secured Party may perform any of its duties
under the Administration Documents by or through officers,
directors, employees, attorneys or agents, and shall be entitled
to employ and consult with legal counsel, independent public
accountants, and other experts or consultants and shall not be
liable for any action taken or omitted to be taken in good faith
in accordance with the advice of such counsel, accountants,
experts or consultants, and may rely and act upon any resolution,
notice, consent, certificate, affidavit, letter or other document
or instrument or writing, or any telecopy, fax, telegram, telex
or teletype, or any court order, or any conversation, which it
believes to be genuine and correct and to have been signed or
made by the proper Person. Administrative Secured Party shall be
fully protected in acting, or in refraining from acting, under
the Administration Documents in accordance with instructions
signed by the Beneficial Secured Parties, and such instructions
and any action or inaction by Administrative Secured Party
pursuant thereto shall be binding on each of the Beneficial
Secured Parties. Neither Administrative Secured Party nor its
affiliates, officers, directors, employees, attorneys, or agents
shall be liable for any action taken or omitted to be taken in
connection with the Administration Documents except for gross
negligence or willful misconduct.
(b) LIMITATION OF SCOPE. Administrative Secured
Party's appointment hereunder is expressly limited as provided in
this Agreement. Administrative Secured Party accepts such
appointment solely as a secured party under the Texas UCC, and as
attorney-in-fact and administrator, on the terms provided by this
Agreement. The duties and responsibilities of Administrative
Secured Party under this Agreement are ministerial and
administrative in nature, and it is expressly agreed that
Administrative Secured Party shall not be a fiduciary or trustee
on behalf of any Person. Administrative Secured Party shall have
no duties or obligations, express or implied, except as expressly
set forth in this Agreement.
(c) AVAILABILITY OF INFORMATION. Administrative
Secured Party will forward to the Beneficial Secured Parties
copies of all reports of a material nature which are furnished by
CompuCom to Administrative Secured Party, other than those, if
any, which by the terms of this Agreement are to be delivered by
CompuCom directly to the Beneficial Secured Parties, PROVIDED,
that
37
Administrative Secured Party shall not have any liability to
any Beneficial Secured Party for failure to do so.
Administrative Secured Party shall promptly notify the Beneficial
Secured Parties upon becoming aware of any Event of Default,
PROVIDED, that in the absence of gross negligence or intentional
misconduct Administrative Secured Party shall not have any
liability to any of the Beneficial Secured Parties for failure to
do so, and PROVIDED FURTHER, that Administrative Secured Party
shall not be deemed to have knowledge or notice of any Event of
Default (other than breaches by CompuCom, of which Administrative
Secured Party has actual knowledge, of CompuCom's obligations
under paragraph 2.1, or failure of timely payment to
Administrative Secured Party of any costs or fees as required by
the Administration Documents) unless it receives written notice
from CompuCom or any Beneficial Secured Party specifying an event
or condition and designating the same as an Event of Default.
Upon request, Administrative Secured Party will make available to
any Beneficial Secured Party any documents, reports or other
items from time to time received from CompuCom and remaining in
Administrative Secured Party's possession.
(d) REQUIRED CONSENT OF BENEFICIAL SECURED
PARTIES. Notwithstanding the authority granted to Administrative
Secured Party elsewhere in this Agreement:
1. The written consent of Administrative
Secured Party and all Beneficial Secured Parties shall be
required as a condition to the effectiveness of any of the
following actions: (i) extend the Contract Term; (ii) release any
security interest or lien in any Collateral; (iii) agree to
waive, modify or amend any covenants, agreements or other
provisions contained in Article I ("Security Interest and
Collateral Covenants"), Article II ("Collections Administration")
or Article V ("Covenants"), Article VI ("Event of Default" or
Article VII ("Remedies"), Article VIII ("Administration"),
Article IX ("Additional Agreements") or Article X
("Miscellaneous") of this Agreement; (iv) consent to allow any
security interests, liens or encumbrances on any Collateral
(other than the Permitted Subordinated Interests), or consent to
allow the disposition of any Collateral other than as expressly
provided by the Administration Documents; (v) grant any consent
or make any agreement which is expressly subject to the consent
of the Beneficial Secured Parties pursuant to this Agreement;
(vi) exercise any remedies under this Agreement to sell or
otherwise dispose of Receivables; (vii) file, or join with any
other Person in filing, any petition against CFI for an order of
relief under the United States Bankruptcy Code or for
receivership or similar relief under
38
any other applicable law; (viii) agreement to amend this subparagraph (1)
of this paragraph 8.1(d).
2. Subject to paragraph 8.1(a), Administrative
Secured Party agrees to take any of the following actions upon written
direction of each and all of the Beneficial Secured Parties, PROVIDED,
that in each instance, such written direction references this paragraph
8.1(d) and specifically identifies the requested action: (i) request or
direct CompuCom to take any action which may be requested or directed by
Administrative Secured Party under the Administration Documents;
(ii) pursue any remedies provided by the Administration
Documents; or (iii) perform or take any action which may be taken
by Administrative Secured Party under the Administration Documents.
3. Subject to paragraph 8.1(a), Administrative Secured
Party agrees to take any of the following actions upon written direction
of any Beneficial Secured Party, PROVIDED, that in each instance, such
written direction references this paragraph 8.1(d) and specifically
identifies the requested action: (i) request information from CompuCom
which may be requested by Administrative Secured Party under the
Administration Documents or (ii) report requested information
regarding Collections administration under Article II.
Notwithstanding the foregoing, no consent shall be
required with respect to any action if Administrative Secured
Party is required to take any such action by court order or
applicable law. Otherwise, except as provided or referenced
above, Administrative Secured Party may amend, modify or waive
any of the terms of the Administration Documents, consent to any
action or failure to act by CompuCom, or exercise or refrain from
exercising any powers or rights which it may have under the
Administration Documents or as a matter of law, without the
requirement of prior notice to or consent of the Beneficial
Secured Parties. Any consent requested by Administrative Secured
Party from any Beneficial Secured Party, and any directive,
consent or refusal of consent given to Administrative Secured
Party by any Beneficial Secured Party, shall be communicated as
provided in paragraph 10.3. In the event any consent requested
by Administrative Secured Party is not granted or refused within
ten (10) days after it is requested by Administrative Secured
Party, the same shall be deemed to have been granted.
(e) LIMITATION OF ADMINISTRATIVE SECURED PARTY'S
LIABILITY. Neither Administrative Secured Party nor any of its
officers, directors, employees, at-
39
torneys or agents shall be liable for any action taken or omitted
to be taken in connection with the Administration Documents in
conformity with instructions or consents of any Beneficial Secured
Party, or based upon its belief that such action or inaction is
within the discretion or power conferred to Administrative Secured
Party under the Administration Documents, nor shall Administrative
Secured Party or any of such officers, directors, employees, attorneys or
agents be liable for the consequences of any error of judgment,
except for gross negligence or wilful misconduct. Administrative
Secured Party shall not be responsible to the Beneficial Secured
Parties for the due execution, validity, effectiveness,
enforceability, or sufficiency of this Agreement or any of the
other Administration Documents, or for any recitals,
representations or warranties, reports, statements contained in
the Administration Documents or furnished in connection
therewith, or for the perfection or value of any Collateral or
for any failure by any other Person to perform any obligations
under the Administration Documents. Administrative Secured Party
shall have no liability to any Beneficial Secured Party with
respect to ascertaining or confirming performance or observation
by CompuCom of any terms, covenants or conditions of any
Administration Documents.
(f) EXPENSES. Each Beneficial Secured Party
severally agrees to reimburse Administrative Secured Party
promptly upon demand for its Pro Rata Percentage share of any and
all out-of-pocket expenses (including reasonable attorneys' fees)
incurred by Administrative Secured Party in connection with the
preparation, execution, delivery, administration, modification,
amendment or enforcement of the Administration Documents, and
legal advice in respect of rights or obligations thereunder
(whether in connection with negotiations, legal proceedings, or
otherwise) to the extent that any such expenses are not paid or
reimbursed to Administrative Secured Party by CompuCom or from
other sources within 60 days after request for payment or
reimbursement is made to CompuCom (PROVIDED that any such payment
by any Beneficial Secured Party to Administrative Secured Party
shall be without prejudice to the right to contest such
Beneficial Secured Party's obligation to make such payment, AND
PROVIDED FURTHER, that EFC shall make any such reimbursement only
to the extent that it has received sufficient funds from all
sellers of accounts to it in excess of the amount necessary to
pay matured and maturing commercial paper). To the extent any
such expenses are recovered by Administrative Secured Party from
CompuCom or other sources after any such amounts have been paid
to Administrative Secured Party by any Beneficial Secured
Party(ies), the amount so recovered shall be refunded by
Administrative Secured Party to each such paying Beneficial
Secured Party ratably according to its respective payments.
40
(g) INDEMNIFICATION. Each Beneficial Secured Party hereby severally
indemnifies, in accordance with its Pro Rata Percentage, and holds harmless
Administrative Secured Party from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses and/or disbursements of any kind or nature whatsoever which may be
imposed on, asserted against, or incurred by Administrative Secured Party in
any way with respect to any Administration Documents (including without
limitation as may arise as a result of any order of a court of competent
jurisdiction pursuant to which Administrative Secured Party is required to
refund, repay or otherwise return any Collections to any other Person) or any
action taken or omitted by Administrative Secured Party under the
Administration Documents, except to the extent the same is caused by gross
negligence or wilful misconduct by Administrative Secured Party (IT BEING
ACKNOWLEDGED THAT IT IS THE EXPRESS INTENTION OF ADMINISTRATIVE SECURED PARTY
AND THE BENEFICIAL SECURED PARTIES THAT SUCH INDEMNIFICATION AND HOLD
HARMLESS OBLIGATIONS SHALL INCLUDE ANY SUCH ACTIONS OR INACTIONS WHICH ARE A
RESULT OF NEGLIGENCE OTHER THAN GROSS NEGLIGENCE), PROVIDED, that EFC's
obligation to make payment under the foregoing indemnity is limited to the
extent that it has received sufficient funds from all sellers of accounts to
it in excess of the amount necessary to pay matured and maturing commercial
paper). Prior to compliance with any instructions by the Beneficial Secured
Parties under the Administration Documents, Administrative Secured Party
shall be entitled to request further assurance of any such indemnification in
form satisfactory to Administrative Secured Party, and unless and until such
further assurance is provided to Administrative Secured Party, Administrative
Secured Party shall have no obligation to comply with such instructions and
may disregard same.
41
(h) REPLACEMENT OF ADMINISTRATIVE SECURED PARTY. Subject to the
following, Administrative Secured Party may resign as Administrative Secured
Party at any time by giving written notice of such resignation to the
Beneficial Secured Parties and CompuCom, and Administrative Secured Party may
be removed upon written notice by unanimous consent of the Beneficial Secured
Parties. Should Administrative Secured Party give any such notice of its
resignation as Administrative Secured Party, or should the Beneficial Secured
Parties give any such notice of removal, then the Beneficial Secured Parties
collectively shall forthwith appoint another Person, acceptable to them and
to CompuCom (such acceptance not to be unreasonably withheld or delayed), to
become Administrative Secured Party, whereupon such newly appointed Person
shall thereafter be Administrative Secured Party and CompuCom and the
Beneficial Secured Parties shall execute such documents as any Beneficial
Secured Party may reasonably request to reflect such change. Any resignation
or removal of Administrative Secured Party shall become effective upon the
appointment of a successor Administrative Secured Party (PROVIDED, that if
the Beneficial Secured Parties fail for any reason to appoint a successor
within sixty (60) days after written notice of such resignation or removal,
Administrative Secured Party shall thereafter have no obligation to act as
Administrative Secured Party hereunder). Any Person appointed as successor
Administrative Secured Party as provided above shall be deemed to accept such
appointment, and such successor Administrative Secured Party shall thereupon
succeed to and become vested with all rights, powers, privileges, immunities,
and duties of the resigning or removed Administrative Secured Party, and the
resigning or removed Administrative Secured Party shall be discharged from
its duties and obligations under this Agreement and the other Administration
Documents. After any Administrative Secured Party's resignation or removal
as Administrative Secured Party, the provisions of this Article VIII shall
continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was Administrative Secured Party.
NationsBank has been appointed as Administrative Secured Party, and has
accepted such appointment, subject to the terms of this Agreement, as of the
Effective Date. As of the Effective Date, NationsBank has delegated
administration of its functions as Administrative Secured Party hereunder to
its affiliate, NationsBank, N.A., headquartered in Charlotte, North Carolina,
and at EFC's request hereby agrees that it will not transfer such
administration to any other division unless such division is acceptable to
Beneficial Secured Parties (such acceptance not to be unreasonably withheld
or delayed).
42
(i) RIGHTS OF ADMINISTRATIVE SECURED PARTY AS BENEFICIAL SECURED PARTY.
Any Beneficial Secured Party who serves as Administrative Secured Party
shall nonetheless continue to have the same rights as a Beneficial Secured
Party, in its individual corporate capacity as a Beneficial Secured Party, as
any other Beneficial Secured Party and may exercise the same as though it
were not acting as Administrative Secured Party, and unless the context
indicates otherwise, to the extent that Administrative Secured Party in its
individual capacity is a Beneficial Secured Party, the term "Beneficial
Secured Party" or "Beneficial Secured Parties," wherever used in the
Administration Documents shall include the Administrative Secured Party in
its individual corporate capacity as a Beneficial Secured Party.
(j) INDEPENDENT CREDIT DECISIONS. Each Beneficial Secured Party
represents, warrants and agrees that it has made its own underwriting analysis
of CompuCom and its own evaluation and valuation of the Collateral and has made
its own decision to enter into this Agreement independently and without reliance
on Administrative Secured Party or any other Beneficial Secured Party and based
on such documents and information as it has deemed appropriate. Each Beneficial
Secured Party further acknowledges and agrees that it will continue to make its
own analysis and decisions in taking or not taking action under this Agreement
or any of the other Administration Documents, independently and without reliance
upon Administrative Secured Party or any other Beneficial Secured Party and
based upon such documents and information as it shall deem appropriate at the
time. Each Beneficial Secured Party acknowledges that it shall have no right to
rely upon Administrative Secured Party to inform it of the financial conditions
or creditworthiness of CompuCom or the condition, value, marketability or other
conditions in respect of the Collateral. Upon written request by any Beneficial
Secured Party, Administrative Secured Party will make any documents, reports or
other information received by Administrative Secured Party from CompuCom and
designated in such request available to such Beneficial Secured Party.
Otherwise, except as specifically provided in this Agreement, Administrative
Secured Party shall not have any duty or responsibility to provide any
Beneficial Secured Party with any credit or other financial information
concerning the affairs, financial condition or business of CompuCom or any of
its subsidiaries or affiliates.
(k) SEVERAL COMMITMENTS. Administrative Secured Party shall not be
liable to CompuCom or any Beneficial Secured Party for any act or omission by
any Beneficial Secured Party, and no Beneficial Secured Party shall be
responsible
43
to CompuCom or any other Beneficial Secured Party for any act or omission of
any other Beneficial Secured Party.
(l) COLLECTION ADMINISTRATION: LOCKBOX; CONCENTRATION ACCOUNT.
On and after the Effective Date and continuing through the end of the Contact
Term, for so long as NationsBank is serving in the capacity as Administrative
Secured Party, it is agreed that (i) the lockbox presently established and
operating in connection with the Credit Agreement shall be deemed to be the
Lockbox and (ii) the concentration account presently established and operating
in connection with the Credit Agreement shall be deemed to be the Concentration
Account, and all Collections during any such period, from time to time, received
or deposited thereto, respectively, shall be deemed to have been received by
Administrative Secured Party solely pursuant, and subject to, the terms of this
Agreement.
(m) BENEFITS. CompuCom expressly acknowledges and agrees to the
provisions of this Article VIII, PROVIDED, that none of the provisions of this
Article shall inure to the benefit of CompuCom or any Person other than
Administrative Secured Party and the Beneficial Secured Parties. CompuCom shall
not be entitled to rely upon, or to raise as a defense, any failure of
Administrative Secured Party or any Beneficial Secured Party to comply with such
provisions. Subject to the requirements of paragraph 8.1(d)1, CompuCom shall be
entitled to rely on actions, agreements and consents of Administrative Secured
Party in connection with administering the Administration Documents as the
actions, agreements and consents of all Beneficial Secured Parties.
ARTICLE VII.
ADDITIONAL AGREEMENTS
In consideration of the mutual benefits under this Agreement,
Administrative Secured Party and the Beneficial Secured Parties each agrees
among themselves as follows:
VII.1 EQUAL DIGNITY. The rights and interests pertaining to the
CompuCom Interest and the RPA Interest, under this Agreement or otherwise, are
of equal dignity and neither shall enjoy or be entitled to any right or benefit
in priority or preference over the other. All such rights and interests, and
all proceeds thereof, shall be shared by the Beneficial Secured Parties
according to their respective Pro Rata Percentage.
44
VII.2 PRO-RATA TREATMENT AMONG BENEFICIAL SECURED PARTIES. All
Collections and other proceeds of Receivables at any time received by
Administrative Secured Party shall be for the account of the Beneficial
Secured Parties in accordance with their respective Pro Rata Percentage as of
the time of Administrative Secured Party's receipt thereof.
VII.3 SUBORDINATION OF INTERESTS.
a. As among Administrative Secured Party and the Beneficial
Secured Parties only and subject to paragraph 9.3(e), NationsBank agrees
that all valid and perfected rights and interests pertaining to the
CompuCom Interest and the RPA Interest under this Agreement are and shall
be first, senior and prior to any other rights now or hereafter claimed
therein by NationsBank, whether under the Credit Agreement or otherwise,
and all security interests, collateral assignments, pledges, liens,
mortgages, rights or other interests now or hereafter claimed by
NationsBank with respect to the Collateral (other than its interest as a
Beneficial Secured Party under this Agreement) shall be and hereby are
expressly subordinated and made junior to all such valid and perfected
rights and interests pertaining to the CompuCom Interest and the RPA
Interest under this Agreement.
b. All sales and transfers of the RPA Interest under the RPA are
expressly subject to the interests granted or delegated to Administrative
Secured Party under this Agreement. As among Administrative Secured Party
and the Beneficial Secured Parties only and subject to paragraph 9.3(e),
CFI agrees that all valid and perfected rights and interests pertaining to
the CompuCom Interest and the RPA Interest under this Agreement are and
shall be first, senior and prior to any other rights now or hereafter
claimed therein by CFI, whether under the RPA, the TAA or otherwise, and
any and all security interests, collateral assignments, pledges, liens,
mortgages, rights or other interests now or hereafter claimed by CFI with
respect to the Collateral (other than its interest as a Beneficial Secured
Party under this Agreement) shall be and hereby are expressly subordinated
and made junior to all such valid and perfected rights and interests
pertaining to the CompuCom Interest and the RPA Interest under this
Agreement. CFI agrees that it will not sell or transfer any RPA Interest
to any Person except EFC pursuant to the TAA subject to the rights of
Administrative Secured Party and the Beneficial Secured Parties under this
Agreement.
45
c. All sales and transfers of any portion of the RPA Interest
under the TAA are expressly subject to the interests granted to
Administrative Secured Party under this Agreement. As among Administrative
Secured Party and the Beneficial Secured Parties only, and subject to
paragraph 9.3(e), EFC agrees that all valid and perfected rights and
interests pertaining to the CompuCom Interest and the RPA Interest under
this Agreement are and shall be first, senior and prior to any rights now
or hereafter claimed therein by EFC (or any assignee of EFC under the TAA),
whether under the TAA or otherwise and any and all security interests,
collateral assignments, pledges, liens, mortgages, rights or other
interests now or hereafter claimed by EFC (or any assignee of EFC under
the TAA) with respect to the Collateral (other than EFC's interest as a
Beneficial Secured Party under this Agreement) shall be and hereby are
expressly subordinated and made junior to all such valid and perfected
rights and interests pertaining to the CompuCom Interest and the RPA
Interest under this Agreement. CompuCom, CFI and EFC each agree that the
RPA and the TAA at all times will contain provisions expressly providing
that all rights and interests in the RPA Interest conveyed or claimed
thereunder are subject to the rights and interests of Administrative
Secured Party under this Agreement. EFC agrees that it will not sell or
transfer any portion of the RPA Interest to any Person (except assignments
of EFC's rights therein to the limited extent provided by the TAA as of
the Effective Date, PROVIDED that any such portions of the RPA Interests
assigned pursuant to any such assignments shall at all times be and remain
subject to the rights of Administrative Secured Party under the
Administration Documents).
d. The Beneficial Secured Parties each agrees, among themselves,
that until termination of this Agreement, if it from time to time comes
into possession of any Collections other than as provided by paragraph
2.1(c) this Agreement, all of such amounts shall be received in trust for
the benefit of the Beneficial Secured Parties according to their respective
Pro Rata Percentages and shall be paid forthwith to Administrative Secured
Party, for the account of the Beneficial Secured Parties, for deposit to
the Concentration Account and administration under paragraph 2.1(c) of this
Agreement. In the event any Beneficial Secured Party is required to
deliver to Administrative Secured Party any amounts received by such
Beneficial Secured Party in respect of Collections as required by this
paragraph 9.3(d) then, for purposes of this paragraph 9.3(d) and clause (1)
of the definition of "Contract Term" in the Definitions of this Agreement,
such Beneficial Secured Party shall be deemed to have received payment in
respect of such Collections only to the extent that it actually receives
46
payment of its Pro Rata Percentage thereof from Administrative Secured
Party pursuant to this paragraph 9.3(d).
e. As among Administrative Secured Party and the Beneficial
Secured Parties only, the subordinations, priorities and agreements
specified in paragraph 9.3(a), paragraph 9.3(b) and paragraph 9.3(c) are
applicable irrespective of the time or order of filing of financing
statements with respect thereto, PROVIDED, that such subordinations,
priorities and agreements are SOLELY for the respective benefit of
Administrative Secured Party and the Beneficial Secured Parties, as a
separate contractual agreement among themselves only, and shall not in any
event operate, entitle or be construed to allow any other Person
(specifically including without limitation any trustee in bankruptcy) to
any rights or priority over Administrative Secured Party or the Beneficial
Secured Parties, or any of them. The subordinations, priorities and
agreements specified in paragraph 9.3(a), paragraph 9.3(b) and
paragraph 9.3(c) shall not be effective to the extent, if any, that any
rights or interests pertaining to the CompuCom Interest or the RPA Interest
for any reason are determined by a court of competent jurisdiction to be
invalid, unenforceable, unperfected or avoidable, or subordinate to any
Person other than Administrative Secured Party and the Beneficial Secured
Parties.
f. Each of the Beneficial Secured Parties may release any Person
now or hereafter liable to such Beneficial Secured Party upon any of the
Secured Obligations, or permit substitutions, or renew, increase, extend or
accept partial payments upon any of the Secured Obligations, or amend or
modify the terms of any instrument or agreement evidencing or otherwise
securing same, or any part thereof, in such manner and at such times from
time to time, as it may determine in its sole discretion, without notice
to or consent from the other, and without in any manner impairing the
rights and obligations under this Agreement (PROVIDED, that the foregoing
shall not impair any condition or requirement imposed upon CompuCom by any
Beneficial Secured Party pursuant to the FSA, the RPA or the TAA,
respectively).
g. Until termination of this Agreement each of NationsBank, CFI
and EFC each agrees, for itself and its successors and assigns, that it
will not take any action to foreclose, repossess, marshal, control, or
exercise remedies or other rights with respect to any Collateral, whether
pursuant to the Credit Agreement, the RPA or the TAA, respectively, or
otherwise (subject to NationsBank's prior rights in respect of returned
inventory under the FSA as provided in paragraph 9.3(h)), PROVIDED, that
the foregoing shall not prohibit or restrict NationsBank, CFI or EFC from
asserting and protecting their respective interests in the
47
Collateral in any bankruptcy proceeding, SUBJECT AT ALL TIMES HOWEVER, to
all other terms and provisions of this Agreement.
h. Notwithstanding any other provisions in this Agreement regarding
rights and relative priorities of interests among Administrative Secured
Party and the Beneficial Secured Parties, it is agreed that all rights
and interests, if any, of Administrative Secured Party, CFI and EFC,
respectively, at any time arising in returned inventory shall be subject
to the prior rights and interests of NationsBank in returned inventory
under the FSA and perfected rights, if any, in returned inventory in favor
of any Person who is a seller of inventory to CompuCom, existing as of the
Effective Date.
i. Notwithstanding the sale and transfer by CompuCom to CFI of
the RPA Interest pursuant to the RPA, and any contemporaneous or subsequent
transfer of a portion thereof by CFI to EFC, from time to time, and
notwithstanding anything to the contrary contained in the RPA or the TAA,
for so long as CompuCom is owner of the CompuCom Interest and until
termination of this Agreement, CFI and EFC each agrees, for itself and its
successors and assigns, that (i) for so long as no Event of Default is in
existence and continuing, CompuCom shall have the sole and exclusive right
to service, administer and collect the Receivables, SUBJECT AT ALL TIMES,
HOWEVER, to the administration of Collections as provided in Article II and
all other rights, interests and remedies of Administrative Secured Party
under the terms and provisions of this Agreement, and no notice or action
under the RPA or TAA shall be effective to limit or preclude such rights
of CompuCom or grant rights to any Person which are inconsistent or in
conflict therewith, (ii) following the occurrence and during the existence
of any Event of Default, any Person other than CompuCom who is appointed to
service Receivables under the RPA or who is appointed as "Collection Agent"
under the TAA shall be a Person that is acceptable to Administrative
Secured Party and the Beneficial Secured Parties, and (iii) without the
prior written consent of Administrative Secured Party, no party to this
Agreement shall (A) exercise any dominion and control over the Collateral
except as expressly provided herein and (B) following an Event of Default,
notify any Account Debtor of CompuCom's transfer to CFI of the RPA Interest
or of CFI's transfer of a portion thereof to EFC.
j. Except as expressly provided in this Agreement, nothing in this
Agreement shall limit or restrict (i) NationsBank in the exercise of rights
and remedies under the Credit Agreement, (ii) CFI in the exercise of rights
and reme-
48
dies under the RPA or (iii) EFC in the exercise of rights and remedies
under the TAA or, as assignee of CFI, the exercise of rights and remedies
under the RPA.
k. In the event of any bankruptcy of CompuCom or CFI, until
termination of this Agreement Administrative Secured Party shall have the
right, and hereby is irrevocably authorized by the Beneficial Secured
Parties, to assert Administrative Secured Party's rights, on behalf of the
Beneficial Secured Parties, to receive, collect and administer the
Receivables in accordance with the provisions of the Administration
Documents.
l. The agreements in this paragraph 9.3 are irrevocable and
continuing, and the Beneficial Secured Parties may continue to rely upon
same in making financial accommodations to or for the account of CompuCom,
without notice to the other except as otherwise provided in this Agreement.
VII.4 OTHER RIGHTS; WAIVER OF MARSHALING. Each of NationsBank, CFI and
EFC waives marshaling as to the other, and agrees that each shall be entitled to
pursue rights and remedies against CompuCom or in respect of property of
CompuCom other than the Collateral as may be provided by any other agreement.
VII.5 ACCESS TO INFORMATION. In consideration of the mutual benefits
of this Agreement, each of NationsBank, CFI and EFC agrees that, upon request,
it will provide to Administrative Secured Party any information available to it
in respect of CompuCom or the Collateral for the purpose of assisting
Administrative Secured Party in administering this Agreement or enforcing and
collecting Receivables. CompuCom expressly agrees and consents to the providing
of any such information for such purpose.
VII.6 PAYMENTS BY ADMINISTRATIVE SECURED PARTY. Administrative Secured
Party shall have no further duty or obligations in respect of any Collections
following administration and transfer thereof in compliance with the
requirements of paragraph 2.1. Each Beneficial Secured Party, severally
according to its respective Pro Rata Percentage, agrees to promptly reimburse
Administrative Secured Party for any checks or items deposited to the
Concentration Account and transferred to such Beneficial Secured Party pursuant
to paragraph 2.1 which are returned unpaid for any reason, PROVIDED, that EFC
shall make any such reimbursement only to the extent that it has received
sufficient funds from all sellers of accounts to it in excess of the amount
necessary to pay matured and maturing commercial paper. In the event EFC, CFI,
or any Person claiming through or under either of them, including any assignee
under the TAA, at any time makes demand upon Administrative Secured Party for
payment of any amount in respect of Collections
49
relative to the RPA Interest, Administrative Secured Party shall be fully
protected in depositing such amount to the CFI Account or, at Administrative
Secured Party's option in its sole discretion, making such payment jointly
payable to CFI and any such claimant and delivering same to an officer of CFI
or such claimant, and in either of such instances, Administrative Secured
Party shall be fully released and discharged from further duty or obligation
in respect of such amount.
VII.7 NOTICES, CONSENTS, AGREEMENTS REGARDING EFC. Any notice, consent
or agreement to or by EFC or any of its permitted assigns pursuant to or in
connection with the Administration Documents shall be effective for all purposes
if given or made to or by the Person serving in the capacity as "Agent" under
the TAA, and the same shall be deemed valid and binding for all purposes of this
Agreement as having been given or made to or by EFC.
VII.8 LIMITATION. CompuCom expressly acknowledges and agrees to the
provisions of this Article IX, PROVIDED, that none of the provisions of this
Article IX shall inure to the benefit of CompuCom. CompuCom shall not be
entitled to rely upon, or to raise as a defense, any matters contained in this
Article IX. Notwithstanding anything in this Agreement to the contrary,
NationsBank, CFI and EFC may amend or modify any agreement contained in this
Article IX by mutual agreement in writing among themselves without necessity of
joinder or consent by any other Person.
ARTICLE VIII.
MISCELLANEOUS
VIII.1 EFFECTIVE DATE; TERM; TERMINATION. This Agreement shall become
effective upon acceptance by Administrative Secured Party, as of the Effective
Date and shall continue in full force and effect through the end of the Contract
Term.
VIII.2 PAYMENTS. All Collections received to the Concentration Account
after the time for closing business on any Business Day as internally
established by applicable depository bank, or otherwise received by
Administrative Secured Party after its internally established time for closing
business on any Business Day, shall be deemed received as of the next succeeding
Business Day.
VIII.3 NOTICES. Any consent, approval, notice, request, or demand from
one party to another must be made in writing to be effective, and shall be
deemed to have been given on the third Business Day after its deposit in the
United States mail, postage
50
prepaid and properly addressed, by certified or registered mail, return
receipt requested, or on the Business Day on which it is actually delivered
by messenger delivery, telecopy or other electronic transmission, whichever
is earlier. The address of each party for the purposes hereof is as follows:
IF TO COMPUCOM:
CompuCom Systems, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇ ▇▇▇▇▇▇, Treasurer
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
IF TO THE ADMINISTRATIVE LENDER:
NationsBank of Texas, N.A.,
MESSENGER DELIVERY: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
IF TO THE ADMINISTRATIVE SECURED PARTY:
NationsBank, N.A.
MESSENGER DELIVERY: NationsBank Corporate Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Structured Finance
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
IF TO CFI:
CSI Funding, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇ ▇▇▇▇, Vice President and Secretary
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
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IF TO EFC:
Enterprise Funding Corporation
c/o Merrill ▇▇▇▇▇ Money Markets, Inc.
World Financial Center--South Tower
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
NationsBank, N.A.
NationsBank ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Investment Banking
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
or such other address as may hereafter be designated and delivered in writing.
VIII.4 BENEFIT TO COMPUCOM. This Agreement is executed at the request
of CompuCom for the purpose of establishing a means by which CompuCom may
utilize its Receivables to access working capital sources VIA the Credit
Agreement and the RPA, as CompuCom shall determine. CompuCom acknowledges that
it has and will continue to receive direct equivalent value for the interests
granted pursuant to this Agreement. CompuCom acknowledges and agrees that (i)
Administrative Secured Party's agreement to serve in such capacity and perform
its duties under the Administration Documents, (ii) NationsBank's agreements
under the Credit Agreement and (iii) CFI's agreements under the RPA and EFC's
agreements under the TAA, respectively, each separately and also collectively
together, constitutes value given to CompuCom for purposes of Section
9.203(a)(2) of the Texas UCC.
VIII.5 ADMINISTRATIVE SECURED PARTY. CompuCom and the Beneficial
Secured Parties have designated NationsBank, in its capacity as Administrative
Secured Party, to serve as Administrative Secured Party as provided by this
Agreement. Each party to this Agreement, for itself and its successors and
assigns, acknowledges that (i) NationsBank is a creditor of CompuCom and that
CFI is a wholly owned subsidiary of CompuCom, (ii) NationsBank, N.A., which is
an affiliate of NationsBank, is a party to the TAA as Agent thereunder, and also
is a Bank Investor, the Liquidity Support Provider and the Credit Support
Provider, as such terms are defined, and as provided, thereunder, (iii)
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appointment of NationsBank to serve as Administrative Secured Party is not a
condition or prerequisite to execution or performance of this Agreement, and
each of CompuCom, NationsBank, CFI and EFC has indicated its willingness to
enter into this Agreement with the Administrative Secured Party being a Person
other than NationsBank, PROVIDED that any such Person otherwise is acceptable to
all parties.
VIII.6 EXERCISE OF RIGHTS. The Beneficial Secured Parties shall not at
any time be required to institute suit or exercise or exhaust remedies against
any Person obligated to pay any of the Secured Obligations, or against any other
property or other security of the payment of same, prior to exercise by
Administrative Secured Party of the rights under this Agreement.
VIII.7 ADMINISTRATIVE SECURED PARTY'S RECORDS; ACCOUNT STATEMENTS.
Administrative Secured Party's records in respect of Collections administered
under this Agreement shall be deemed conclusive absent demonstration of error
and all statements of account rendered by Administrative Secured Party to
CompuCom relating same shall be presumed to be correct and accurate unless,
within thirty (30) days after receipt thereof, CompuCom shall notify
Administrative Secured Party in writing of any claimed error therein.
VIII.8 INDEMNITY.
(a) THIRD PARTY CLAIMS. Any Indemnified Person shall notify
CompuCom promptly after such Indemnified Person's receipt of notice, or
such Indemnified Person otherwise becoming aware, of any third-party claims
with respect to which indemnification may be sought under this Section;
PROVIDED THAT, the failure of any Indemnified Person so to notify CompuCom
shall not relieve CompuCom of any liability (x) under any provision hereof,
(y) to such Indemnified Person by reason of this Section unless such
Indemnified Person's failure to so notify CompuCom materially prejudices
CompuCom's ability to contest the third-party claim, or (z) to any other
Indemnified Person under this Section or any other provision hereof. In
case any such action is brought against any Indemnified Person and it
notifies CompuCom of the commencement thereof, CompuCom shall be entitled
to participate therein and, to the extent that it may wish to assume the
defense thereof, with counsel reasonably satisfactory to such Indemnified
Person, and after notice from CompuCom to such Indemnified Person of its
election to assume the defense thereof, CompuCom will not be liable to such
Indemnified Person under this Subsection for any legal fees and expenses
subsequently incurred by such Indemnified Person in connection with the
defense thereof. Any one or more of the Indemnified Persons shall have
the right to
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employ separate counsel in any such action and to participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Indemnified Person or Indemnified Persons unless (i) the
employment of such has been specifically authorized in writing by CompuCom
or (ii) representation of both CompuCom and such Indemnified Person or
Indemnified Persons by the same counsel would be inappropriate due to
actual or potential differing interests between them. CompuCom shall not
be liable for any settlement of any such action effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff in any such action with or without consent,
CompuCom agrees to indemnify and hold harmless the Indemnified Persons
from and against any loss or liability by reason of such settlement or
final judgment. CompuCom shall not, without the prior written consent of
the Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been
a party and indemnity could have been sought hereunder by such Indemnified
Person, unless such settlement includes an unconditional release of such
Indemnified Person from all liabilities and claims that are the subject
matter of such proceeding. Any indemnification will be paid promptly upon
demand therefor.
(b) CONTRIBUTION. If for any reason the indemnification
provided above in this Section is unavailable to an Indemnified Person or
is insufficient to hold an Indemnified Person harmless, then CompuCom shall
contribute to the amount paid or payable by such Indemnified Person as a
result of such loss, claim, damage or liability in such proportion as is
appropriate to reflect not only the relative benefits received by such
Indemnified Person on the one hand and CompuCom on the other hand but also
the relative fault of such Indemnified Person, as well as any other
relevant equitable considerations.
VIII.9 INTEREST LIMITATION. CompuCom expressly agrees that any
provision contained in the Credit Agreement, the RPA, the TAA or any other
agreement between CompuCom and NationsBank, CFI or EFC, respectively,
pertaining to limitations on the maximum rate of interest that may be
contracted, charged or received in connection therewith shall be deemed
applicable to any payments, rights or benefits paid or accrued to such party
under the Administration Documents.
VIII.10 COSTS AND EXPENSES. CompuCom agrees to pay all costs and
expenses incurred by Administrative Secured Party in connection with the
Administration Documents, including without limitation: (i) negotiation,
preparation and closing of the Administration Documents, including attorneys
fees and disbursements, search fees, filing and recording fees, (ii) ongoing
administration of the Administration Documents,
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including without limitation, fees and costs incurred in consultation with
attorneys, (iii) negotiation, preparation and closing of any amendment,
waiver or consent relating to the Administration Documents, including
attorneys fees and disbursements, search fees, filing and recording fees, and
(iv) enforcing any provision of the Administration Documents, collection and
pursuit of collection and enforcement of Receivables, taking possession,
exercising any rights or remedies or pursuing or defending any claim arising
out of, or in any way relating to the Administration Documents, including
without limitation fees and costs of attorneys, experts or other consultants
retained by Administrative Secured Party in connection therewith and any
other costs, fees or expenses for which CompuCom is obligated pursuant to any
other provision of the Administration Documents. CompuCom will pay any
applicable stamp, registration, recordation and similar taxes, fees and
charges in respect of the Collateral or perfection or maintenance of
Administrative Secured Party's rights under the Administration Documents, and
agrees to indemnify Administrative Secured Party against any liabilities
resulting from any delay, deferral or omission in payment of any such taxes,
fees or charges. All fees, costs and expenses for which CompuCom is
obligated under the Administration Documents shall be payable to
Administrative Secured Party on demand.
VIII.11 ACCEPTANCE AND PERFORMANCE. This Agreement shall become
effective only upon acceptance by Administrative Secured Party at its offices in
Dallas, Dallas County, Texas. This Agreement is performable at Administrative
Secured Party's offices in Dallas, Dallas County, Texas, such acceptance to be
conclusively established by execution of this Agreement by Administrative
Secured Party. CompuCom and Administrative Secured Party each agree that Dallas
County, Texas shall be the exclusive venue for litigation of any dispute or
claim arising under or relating to the Administration Documents, and that such
county is a convenient forum in which to decide any such dispute. CompuCom and
Administrative Secured Party each consents to the personal jurisdiction of the
state and federal courts located in Dallas County, Texas for the litigation of
any such dispute or claim.
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VIII.12 WAIVER OF TRIAL BY JURY. THE PARTIES HERETO AGREE THAT NO PARTY
SHALL REQUEST A TRIAL BY JURY IN THE EVENT OF LITIGATION BETWEEN THEM CONCERNING
THE LOAN DOCUMENTS OR ANY CLAIMS OR TRANSACTIONS IN CONNECTION THEREWITH, IN
EITHER A STATE OR FEDERAL COURT, THE RIGHT TO TRIAL BY JURY BEING EXPRESSLY
WAIVED. ADMINISTRATIVE SECURED PARTY, COMPUCOM, AND BENEFICIAL SECURED PARTIES
EACH ACKNOWLEDGE THAT SUCH WAIVER IS MADE WITH FULL KNOWLEDGE AND UNDERSTANDING
OF THE NATURE OF THE RIGHTS AND BENEFITS WAIVED HEREBY, AND WITH THE BENEFIT OF
ADVICE OF COUNSEL OF ITS CHOOSING.
VIII.13 COPIES VALID AS FINANCING STATEMENTS. CompuCom grants to
Administrative Secured Party a special power of attorney to sign CompuCom's
name, on behalf of CompuCom, to any financing statement describing the
Collateral, or any part thereof, or to any amendment of any financing statement
filed pursuant to this Agreement, and to file such financing statement or
amendment in any jurisdiction deemed necessary by Administrative Secured Party
to perfect Administrative Secured Party's interests under this Agreement. A
carbon, photographic or other reproduction, including photocopy, telecopy or
electronic transmission, of this Agreement or any financing statement shall be
sufficient as a financing statement and may be filed as an original.
VIII.14 GOVERNING LAW. THIS AGREEMENT, AND ALL DOCUMENTS AND INSTRUMENTS
EXECUTED IN CONNECTION HEREWITH, SHALL BE GOVERNED BY AND CONSTRUED ACCORDING TO
THE LAWS OF THE STATE OF TEXAS, PROVIDED, THAT TO THE EXTENT FEDERAL LAW WOULD
ALLOW A HIGHER RATE OF INTEREST THAN WOULD BE ALLOWED BY THE LAWS OF THE STATE
OF TEXAS, THEN WITH RESPECT TO THE PROVISIONS OF ANY LAW WHICH PURPORTS TO LIMIT
THE AMOUNT OF INTEREST THAT MAY BE CONTRACTED FOR, CHARGED OR RECEIVED IN
CONNECTION WITH ANY OF THE OBLIGATIONS, SUCH FEDERAL LAW SHALL APPLY.
VIII.15 ENTIRETY AND AMENDMENTS. This Agreement embodies the entire
agreement between the parties relating to the subject matter hereof, and may be
modified or amended only by an instrument in writing executed by an authorized
officer of each of Administrative Secured Party, each of the Beneficial Secured
Parties and CompuCom. It is expressly agreed that no conversations, statements,
negotiations or other verbal communications between Administrative Secured Party
and CompuCom, nor any purported modification or amendment, or waiver, shall be
binding unless the same is evidenced in writing executed by an authorized
officer of each of Administrative Secured Party, each of the Beneficial Secured
Parties and CompuCom.
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VIII.16 PARTIES BOUND. This Agreement shall be binding upon and inure to
the benefit of CompuCom, Administrative Secured Party and the Beneficial Secured
Parties, and their respective successors in interest. CompuCom may not assign
any right, power, duty, or obligation under this Agreement, or any document or
instrument executed in connection herewith, without the prior written consent of
Administrative Secured Party and each Beneficial Secured Party. Neither CFI nor
EFC may assign any right, power, duty, or obligation under this Agreement, or
any document or instrument executed in connection herewith, without the prior
written consent of Administrative Secured Party (except assignments to the
limited extent provided in the RPA and TAA as of the Effective Date, PROVIDED
that any such portions of the RPA Interests assigned pursuant to any such
assignments at all times shall be and remain subject to Administrative Secured
Party's rights and interests under this Agreement). This Agreement is intended
for the benefit of CompuCom, Administrative Secured Party, the Beneficial
Secured Parties (and any Person properly claiming through any of them as an
assignee to the limited extent otherwise permitted by this Agreement), and may
not be relied upon by any other Person.
VIII.17 EXHIBITS. All exhibits referenced herein, and attached hereto,
are incorporated in this Agreement and made a part hereof for all purposes.
VIII.18 DESCRIPTIVE TITLES. The descriptive titles "Administrative
Secured Party" and "Beneficial Secured Party" are for convenience only and shall
not themselves be construed to limit the rights and powers granted to
Administrative Secured Party or Beneficial Secured Parties under this Agreement.
VIII.19 CUMULATIVE RIGHTS. All rights and remedies of Administrative
Secured Party under the Administration Documents are cumulative, and are in
addition to rights and remedies available to Administrative Secured Party by
applicable law. Such rights and remedies may be exercised concurrently or
successively, at such times as Administrative Secured Party may determine in its
discretion. CompuCom waives any right to require marshaling. If Administrative
Secured Party, in its individual corporate capacity, and CompuCom are parties to
any prior agreement, either written or oral, relating to the Collateral, the
terms of this Agreement shall supersede the terms of such prior agreements as to
transactions respecting the Collateral on or after the Effective Date, but all
security agreements, financing statements, guaranties, other contracts and
notices for the benefit of Administrative Secured Party, in its individual
corporate capacity, in connection with any such prior agreement shall continue
in full force and effect (subject to the terms of this Agreement) to secure all
obligations under the terms
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thereof unless Administrative Secured Party specifically releases its rights
thereunder by separate release in writing executed by Administrative Secured
Party.
VIII.20 SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under any present or future laws effective
during the Contract Term, such provisions shall be fully severable, and this
Agreement shall be construed and enforced as if such illegal, invalid, or
unenforceable provision had never comprised a part of this Agreement. In such
case, the remaining provisions of the Agreement shall remain in full force and
effect and shall not be effected thereby.
VIII.21 MULTIPLE COUNTERPARTS. This Agreement may be executed
simultaneously in one or more multiple originals, each of which shall be deemed
an original, but all of which together shall constitute one and the same
Agreement.
VIII.22 SURVIVAL. All covenants, agreements, representations, and
warranties made by CompuCom herein shall survive the execution, delivery, and
closing of this Agreement, and all documents executed in connection herewith,
and shall not be affected by any investigation made by any party.
THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
[Remainder of page intentionally left blank]
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EXECUTED as of the effective date specified in the preamble.
COMPUCOM SYSTEMS, INC.
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Authorized Signatory
NATIONSBANK OF TEXAS, N.A.,
IN ITS CAPACITY AS ADMINISTRATIVE SECURED PARTY
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Authorized Signatory
NATIONSBANK OF TEXAS, N.A.,
IN ITS CAPACITY AS ADMINISTRATIVE LENDER
ON BEHALF OF THE LENDERS
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Authorized Signatory
CSI FUNDING, INC.
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Authorized Signatory
ENTERPRISE FUNDING CORPORATION
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Authorized Signatory
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