EXHIBIT 4.4
INTERCREDITOR AGREEMENT
This INTERCREDITOR AGREEMENT (as amended, amended and restated or
otherwise modified from time to time in accordance with the terms hereof, herein
called this "AGREEMENT") is dated as of April 23, 2001 among BANKERS TRUST
COMPANY ("BANKERS"), as administrative agent (the "LENDER AGENT") for the
lenders (the "LENDERS") party to the Credit Agreement (as hereinafter defined),
BANKERS TRUST COMPANY, as Collateral Agent (as hereinafter defined), and the
other persons who may become parties to this Agreement from time to time
pursuant to and in accordance with SECTION 6 of this Agreement. Initially
capitalized terms used herein without definition are defined in the Credit
Agreement (as hereinafter defined).
R E C I T A L S
1. The Lenders and the Lender Agent have entered into a Secured Credit
Agreement dated as of April 23, 2001 with the Borrowers named therein,
▇▇▇▇▇-Illinois Group, Inc., a Delaware corporation ("COMPANY"), and
▇▇▇▇▇-Illinois General, Inc., as Borrowers' Agent (as amended, amended and
restated or otherwise modified from time to time, the "CREDIT AGREEMENT", which
term shall also include and refer to any successor or replacement facility of
Company or its Subsidiaries designated in writing as such by Borrowers' Agent
with Collateral Agents' consent and acknowledgement of the termination of the
predecessor Credit Agreement by an agent for the lenders thereunder).
2. Company has guarantied the Obligations of the Borrowers under the
Credit Agreement as well as certain Other Permitted Credit Exposure, Interest
Rate Obligations and Currency Obligations (each defined below) pursuant to
Section 9 of the Credit Agreement (the "COMPANY GUARANTY").
3. (i) Each of the Domestic Borrowers have guaranteed (A) all Loans made
to, and other Obligations of, the other Domestic Borrowers, (B) all Offshore
Loans made to, and other Obligations of, the Offshore Borrowers and (C) Other
Permitted Credit Exposure, (ii) OI Plastics and OI Closure have guaranteed the
Term Loans made to, and related Obligations of, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and OI General
FTS, and (iii) OI General FTS has guaranteed the Revolving Loans made to, and
related obligations of, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, OI Plastics and OI Closure, in each case
pursuant to a certain Domestic Borrowers' Guaranty dated April 23, 2001 (as
amended, amended and restated or otherwise modified from time to time, the
"DOMESTIC BORROWERS' GUARANTY").
4. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Packaging, Inc., a Delaware corporation ("PACKAGING")
and the other Subsidiary Guarantors have guarantied the Obligations of the
Borrowers under the Credit Agreement as well as certain Other Permitted Credit
Exposure, Interest Rate Obligations and Currency Obligations pursuant to a
certain Loan Guaranty dated April 23, 2001 (as amended, amended and restated or
otherwise modified from time to time, the "SUBSIDIARY GUARANTY").
5. Company and Packaging (collectively, the "PLEDGORS") have executed and
delivered to the Collateral Agent a Pledge Agreement dated as of April 23, 2001
(as amended, amended and restated or otherwise modified from time to time, the
"PLEDGE AGREEMENT"; a copy of the
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Pledge Agreement as in effect on the date this Agreement becomes effective is
attached to this Agreement as ANNEX 1).
6. Domestic Borrowers, Company, and the Subsidiary Guarantors, including
Packaging, identified on Schedule 1.1B annexed to the Credit Agreement have
executed and delivered to the Collateral Agent a Security Agreement dated as of
April 23, 2001 (as amended, amended and restated or otherwise modified from time
to time, the "SECURITY AGREEMENT"; a copy of the Security Agreement as in effect
on the date this Agreement becomes effective is attached to this Agreement as
ANNEX 2).
7. Certain of the Domestic Borrowers and the Subsidiary Guarantors may
execute and deliver pursuant to the terms of the Credit Agreement, the Initial
Mortgages and shall from time to time pursuant to the terms of the Credit
Agreement execute and deliver Additional Mortgages, in each case securing a Real
Property Asset owned by such Domestic Borrower or Subsidiary Guarantor (the
Initial Mortgages and the Additional Mortgages are referred to herein as the
"MORTGAGES"). The Pledge Agreement, the Security Agreement and the Mortgages are
collectively referred to herein as the "COLLATERAL Documents". All collateral
pledged or secured by the Collateral Documents is collectively referred to
herein as the "DOMESTIC COLLATERAL".
8. (a) The obligations of Company under the Credit Agreement and Packaging
under the Subsidiary Guaranty have been secured by certain Pledged Shares and
Pledged Debt on a senior basis pursuant to the Pledge Agreement, (b) the
obligations of the Domestic Borrowers under the Credit Agreement, Company under
the Company Guaranty and Subsidiary Guarantors under the Subsidiary Guaranty
have been secured by certain Pledged Shares and Pledged Debt and other Domestic
Collateral on a senior basis pursuant to the Security Agreement and (c) the
obligations of certain Subsidiary Guarantors under the Subsidiary Guaranty have
been secured on a senior basis pursuant to the Mortgages.
9. ▇▇▇▇▇-Illinois, Inc., a Delaware corporation ("HOLDINGS"), and certain
trustees (each an "EXISTING SENIOR NOTE TRUSTEE" and collectively, the "EXISTING
SENIOR NOTE TRUSTEES") have entered into the Indentures dated as of May 15, 1997
and May 20, 1998 (each as amended, supplemented or otherwise modified from time
to time, an "EXISTING SENIOR NOTE INDENTURE" and collectively, the "EXISTING
SENIOR NOTE INDENTURES") pursuant to which Holdings has issued the following
senior notes and debentures (collectively, the "EXISTING SENIOR NOTES"): (i) the
7.85% Senior Notes due 2004 in the aggregate principal amount of $300,000,000;
(ii) the 7.15% Senior Notes due 2005 in the aggregate principal amount of
$350,000,000; (iii) the 8.10% Senior Notes due 2007 in the aggregate principal
amount of $300,000,000; (iv) the 7.35% Senior Notes due 2008 in the aggregate
principal amount of $250,000,000; (v) the 7.50% Senior Debentures due 2010 in
the aggregate principal amount of $250,000,000; and (vi) the 7.80% Senior
Debentures due 2018 in the aggregate principal amount of $250,000,000.
10. If the Supplemental Indenture Condition (as hereinafter defined) has
been satisfied, the Company and Packaging may guaranty the obligations of
Holdings under the Existing Senior Note Indentures and the Existing Senior Notes
issued thereunder pursuant to subordinated guaranties (the "EXISTING SENIOR
NOTES SUBORDINATED GUARANTY").
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11. It is contemplated that, from time to time Subsidiaries and Joint
Ventures of Company may incur obligations to Lenders or affiliates of Lenders
arising out of loans, advances, overdrafts, interest rate, currency or hedge
products and other derivative exposures or other extensions of credit to the
extent permitted under the Credit Agreement ("OTHER PERMITTED CREDIT Exposure").
Company has guaranteed such Other Permitted Credit Exposure pursuant to the
Company Guaranty, the Domestic Borrowers have guaranteed such other Permitted
Credit Exposure pursuant to the Domestic Borrowers' Guaranty and the Subsidiary
Guarantors have guaranteed such Other Permitted Credit Exposure pursuant to the
Subsidiary Guaranty. Each holder of such Other Permitted Credit Exposure is
referred to herein as an "OTHER PERMITTED CREDIT EXPOSURE HOLDER" and,
collectively, all such holders are referred to as the "OTHER PERMITTED CREDIT
EXPOSURE HOLDERS". Notwithstanding the foregoing, an Other Permitted Credit
Exposure Holder may only receive the benefit of the Loan Guaranties and may only
be secured by the Domestic Collateral pursuant to the Collateral Documents if
(a) such Other Permitted Credit Exposure Holder delivers to the Collateral Agent
a duly executed acknowledgment to this Agreement (in the form attached hereto)
agreeing to be bound by the terms hereof, (b) the Borrowers' Agent has duly
executed and delivered an acknowledgement to such acknowledgement, (c) pursuant
to Section 9 of the Credit Agreement, such holder remains a Lender or an
Affiliate of a Lender under the Credit Agreement and (d) and such Other
Permitted Credit Exposure Holder shall have released and terminated any guaranty
by Holdings of Other Permitted Credit Exposure.
12. Company, Domestic Borrowers and Subsidiary Guarantors (collectively,
the "LOAN GUARANTORS") have entered into and/or will enter into from time to
time (i) the Company Guaranty, (ii) the Domestic Borrowers' Guaranty and (iii)
the Subsidiary Guaranty, respectively (collectively, the "LOAN GUARANTIES").
13. It is contemplated that, from time to time to the extent permitted by
the Credit Agreement, Company, Packaging, Domestic Borrowers and/or the other
Subsidiary Guarantors may issue or guaranty certain New Senior Debt (any
indenture, debenture, note, guaranty or other document executed by Company,
Packaging and or any other Subsidiary Guarantor in connection with the issuance
of any such New Senior Debt is referred to herein as a "NEW SENIOR DEBT
DOCUMENT" individually and the "NEW SENIOR DEBT DOCUMENTS" collectively and any
trustee or like representative of the holders of any such New Senior Debt is
referred to herein as a "NEW SENIOR DEBT REPRESENTATIVE"), which New Senior Debt
Documents may be secured by the Domestic Collateral pursuant to the Collateral
Documents; PROVIDED, THAT, for any holder of any New Senior Debt to receive the
benefit of such security it shall cause a New Senior Debt Representative for
such New Senior Debt to execute and deliver to the Collateral Agent an
acknowledgment to this Agreement (in the form attached hereto) agreeing to be
bound by the terms hereof (which acknowledgment shall be acknowledged by the
Borrower's Agent).
14. It is contemplated that, from time to time to the extent permitted by
the Credit Agreement, Holdings, may issue on a senior basis, and Company and/or
Packaging may issue or guaranty, on a subordinated basis, certain Refinancing
Senior Debt. Any indenture, debenture, note, guaranty or other document executed
by Holdings, Company or Packaging in connection with the issuance of any such
Refinancing Senior Debt is referred to herein as a "REFINANCING SENIOR DEBT
DOCUMENT" individually and the "REFINANCING SENIOR DEBT DOCUMENTS" collectively,
and any trustee or like representative of the holders of any such Refinancing
Senior
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Debt is referred to herein as a "REFINANCING SENIOR DEBT REPRESENTATIVE").
Refinancing Senior Debt Documents may be secured, on a subordinated basis, by
the Domestic Collateral pursuant to the Pledge Agreement (but neither the
Security Agreement nor the Mortgages or any other Collateral Documents);
PROVIDED, THAT, for any holder of any Refinancing Senior Debt to receive the
benefit of such security it shall cause a Refinancing Senior Debt Representative
for such issue to execute and deliver to the Collateral Agent an acknowledgment
to this Agreement (in the form attached hereto) agreeing to be bound by the
terms hereof (which acknowledgment shall be acknowledged by the Borrowers'
Agent).
15. It is contemplated that, from time to time to the extent permitted by
the Credit Agreement, Holdings, Company and/or Packaging may issue or guaranty,
on a subordinated basis, New Junior Debt. Any indenture, debenture, note,
guaranty or other document executed by Holdings, Company or Packaging in
connection with the issuance of any such New Junior Debt is referred to herein
as a "NEW JUNIOR DEBT DOCUMENT" individually and the "NEW JUNIOR DEBT DOCUMENTS"
collectively. Any trustee or like representative of the holders of any New
Junior Debt is referred to herein as a "NEW JUNIOR DEBT REPRESENTATIVE". New
Junior Debt Documents may be secured, on a subordinated basis, by the Domestic
Collateral pursuant to the Pledge Agreement (but not the Security Agreement or
the Mortgages or any other Collateral Documents); PROVIDED, THAT, for any holder
of any New Junior Debt to receive the benefit of such security it shall cause a
New Junior Debt Representative for such issue to execute and deliver to the
Collateral Agent an acknowledgment to this Agreement (in the form attached
hereto) agreeing to be bound by the terms hereof (which acknowledgment shall be
acknowledged by the Borrowers' Agent).
16. It is contemplated that Company or its Subsidiaries may from time to
time assume from Holdings or enter into one or more Interest Rate Agreements
with one or more Lenders or their respective affiliates (collectively, the
"INTEREST RATE EXCHANGERS") and it is desired that the obligations of Company or
its Subsidiaries under such Interest Rate Agreements, including the obligation
to make payments in the event of early termination thereunder (all such
obligations being the "INTEREST RATE OBLIGATIONS"), be secured by the Domestic
Collateral pursuant to the Collateral Documents; PROVIDED, THAT, for any
Interest Rate Exchanger to receive the benefit of such security and the Loan
Guaranties (a) it shall execute and deliver to the Collateral Agent an
acknowledgment to this Agreement (in the form attached hereto) agreeing to be
bound by the terms hereof (which acknowledgment shall be acknowledged by the
Borrowers' Agent) and (b) pursuant to Section 9 of the Credit Agreement, such
Interest Rate Exchanger remains a Lender or an Affiliate of a Lender under the
Credit Agreement.
17. It is contemplated that Company or its Subsidiaries may from time to
time assume from Holdings or enter into one or more Currency Agreements with one
or more Lenders or their respective Affiliates (collectively, the "CURRENCY
EXCHANGERS") and it is desired that the obligations of Company or its
Subsidiaries under such Currency Agreements, including the obligation to make
payments in the event of early termination thereunder (all such obligations
being the "CURRENCY OBLIGATIONS"), be secured by the Domestic Collateral
pursuant to the Collateral Documents; PROVIDED, THAT, for any Currency Exchanger
desiring the benefit of such security and the Loan Guaranties (a) it shall
execute and deliver to the Collateral Agent an acknowledgment to this Agreement
(in the form attached hereto) agreeing to be bound by the terms hereof (which
acknowledgment shall be acknowledged by the Borrowers' Agent) and
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(b) pursuant to Section 9 of the Credit Agreement, such Currency Exchanger
remains a Lender or an Affiliate of a Lender under the Credit Agreement.
18. (a) The Lender Agent and the current Other Permitted Credit Exposure
Holders named on the signature pages hereof, (b) and in the event any Interest
Rate Obligations are to be secured by the Collateral Documents, the Interest
Rate Exchanger party to the relevant Interest Rate Agreement, (c) and in the
event any Currency Obligations are to be secured by the Collateral Documents,
the Currency Exchanger party to the relevant Currency Agreement, (d) and in the
event any obligations in respect of any New Senior Debt are to be secured by the
Collateral Documents, the New Senior Debt Representative in respect of such New
Senior Debt, (e) and in the event any obligations in respect of any Refinancing
Senior Debt are to be secured by the Pledge Agreement, the Refinancing Senior
Debt Representative in respect to such Refinancing Senior Debt, (f) and in the
event any obligations in respect of any New Junior Debt are to be secured by the
Pledge Agreement, the New Junior Debt Representative in respect of such New
Junior Debt, and (g) in the event the Supplemental Indenture Condition has been
satisfied, the Existing Senior Note Trustees in respect of such Existing Senior
Notes and the Collateral Agent (collectively, the "SECURED PARTIES") desire to
set forth certain additional provisions regarding the appointment, duties and
responsibilities of the Collateral Agent and to set forth certain other
provisions concerning the obligations of the Pledgors, Borrowers and the other
Subsidiary Guarantors (collectively, the "GRANTORS") and the Loan Guarantors to
the Secured Parties under the agreements referred to in the foregoing recitals.
"SUPPLEMENTAL INDENTURE CONDITION" means the Existing Senior Notes Trustees and
Holdings, the Company and Packaging have executed and delivered one or more
supplemental indentures which effect amendments to the Existing Senior Notes
Indentures with respect to each series of Existing Senior Notes to provide for
the Existing Senior Notes Subordinated Guaranty and certain terms and conditions
relating to the Domestic Collateral, which supplemental indentures shall be in
form and substance satisfactory to and approved by the Agents.
19. The Secured Parties wish to set forth their agreement as to the
allocation of certain payments to be made from Net Asset Sale Proceeds of
Domestic Collateral and Net Insurance/Condemnation Proceeds or Net Debt
Securities Proceeds arising from the issuance of Receivables Sale Indebtedness
arising therefrom.
20. The Secured Parties wish to set forth their agreement as to decisions
relating to the exercise of remedies under the Loan Guaranties and the
Collateral Documents and certain limitations on the exercise of such remedies.
21. The Secured Parties wish to confirm their agreement that (a) in no
event shall either the Second Priority Secured Obligations (as defined in the
Pledge Agreement) or the Third Priority Secured Obligations (as defined in the
Pledge Agreement), be secured by or have any rights with respect to the Domestic
Collateral under the Security Agreement or any Mortgage or any other Collateral
Document (other than the Pledge Agreement) or benefit from or have any rights
with respect to the Loan Guaranties, (b) certain remedies under the Pledge
Agreement shall not be taken for the benefit of Second Priority Secured
Obligations unless such remedies are concurrently being exercised for the
benefit of Senior Secured Obligations (as defined in the Pledge Agreement), or
unless all such Senior Secured Obligations have been paid in full in cash and
all Commitments and Letters of Credit have terminated and (c) certain remedies
under the
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Pledge Agreement shall not be taken for the benefit of any Third Priority
Secured Obligations unless such remedies are being concurrently exercised for
the benefit of the Senior Secured Obligations and the Second Priority Secured
Obligations or unless all such Senior Secured Obligations and/or Second Priority
Secured Obligations have been paid in full in cash and all Commitments and
Letters of Credit have terminated.
22. The Secured Parties wish to confirm that certain subordination
provisions granting benefits to the holders of certain senior indebtedness shall
not be impaired by the granting of security interests in collateral, or the
exercise of rights with respect to such collateral, in favor of the holders of
certain junior indebtedness.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. APPOINTMENT AS COLLATERAL AGENT. The Lender Agent and each
Other Permitted Credit Exposure Holder listed on the signature pages hereof each
hereby appoints, and each Interest Rate Exchanger, Currency Exchanger, New
Senior Debt Representative, Refinancing Senior Debt Representative and New
Junior Debt Representative signing, an acknowledgment hereto, by such signing
and each Existing Senior Note Trustee by signing an acknowledgement hereto or
pursuant to an Existing Senior Note Supplemental Indenture, by such signing or
pursuant to such indenture, appoints Bankers Trust Company to serve as
collateral agent and representative of each such Secured Party under each of the
Collateral Documents and the Loan Guaranties (in such capacity, together with
its successors in such capacity, the "COLLATERAL AGENT") and authorizes the
Collateral Agent to act as agent for the Secured Parties for the purpose of
executing and delivering, on behalf of all such Secured Parties, the Pledge
Agreement and, on behalf of the Lender Agent, the Other Permitted Credit
Exposure Holders, the Interest Rate Exchangers, the Currency Exchangers, the New
Senior Debt Representatives (the "SENIOR SECURED Parties") and the Existing
Senior Note Trustees, the Security Agreement, the Mortgages, the Loan Guaranties
(as applicable) and any other documents or instruments related thereto or
necessary to perfect the same and, subject to the provisions of this Agreement,
for the purpose of enforcing the Secured Parties' rights in respect of the
Domestic Collateral and the obligations of the Grantors under the Collateral
Documents and obligations of the Loan Guarantors under the Loan Guaranties.
SECTION 2. DECISIONS RELATING TO EXERCISE OF REMEDIES VESTED IN REQUISITE
OBLIGEES UNDER THE CREDIT AGREEMENT, INTEREST RATE AGREEMENTS, CURRENCY
AGREEMENTS, OTHER PERMITTED CREDIT EXPOSURE GUARANTIES, NEW SENIOR DEBT
DOCUMENTS, EXISTING SENIOR NOTE INDENTURES, REFINANCING SENIOR DEBT DOCUMENTS,
NEW JUNIOR DEBT DOCUMENTS, COLLATERAL DOCUMENTS AND LOAN GUARANTIES.
(a) The Collateral Agent agrees to make such demands and give such
notices under the Loan Guaranties and the Collateral Documents as Requisite
Obligees may request, and to take such action to enforce the Loan Guaranties and
the Collateral Agreements and to foreclose upon, collect and dispose of the
Domestic Collateral or any portion thereof as may be directed by Requisite
Obligees. For purposes of this Agreement, (i) "REQUISITE OBLIGEES" means, for
purposes of directing the Collateral Agent with respect to any of the foregoing
actions to be taken pursuant to any of the Collateral Documents or the Loan
Guaranties, Lenders holding 51% or more of the aggregate principal amount of the
sum of (A) all Loans outstanding, (B) all
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other credit facilities utilized (including the stated amount of all Letters of
Credit, Domestic and Offshore Overdraft Amounts and the face amount of all
unmatured discounted bankers' acceptances, if any) under the Credit Agreement
and (C) all unused Commitments under the Credit Agreement (ii) provided, that,
if the Obligations (such term being used herein as defined in the Credit
Agreement) have been indefeasibly paid in full in cash and the Credit Agreement
and Letters of Credit have terminated, "REQUISITE OBLIGEES" shall mean (1)
Secured Parties holding 51% or more of the aggregate amount of the sum of (A)
the principal amount of the Other Permitted Credit Exposure then secured by
Domestic Collateral, (B) 20% of the notional amount under all Interest Rate
Agreements and Currency Agreements or, if an Interest Rate Agreement or Currency
Agreement has been terminated in accordance with its terms, the amount then due
and payable (exclusive of expenses and similar payments but including any early
termination payments then due) under such Interest Rate Agreement or Currency
Agreement, as the case may be, and (C) in the case of the Collateral Documents
only (and NOT the Loan Guaranties) the aggregate outstanding principal amount of
the New Senior Debt (to the extent such New Senior Debt is then secured by the
Domestic Collateral under the Collateral Documents), until indefeasible payment
in full in cash of all Other Permitted Credit Exposure secured by the Domestic
Collateral, Interest Rate Obligations, the Currency Obligations, and all New
Senior Debt, secured by the Domestic Collateral under the Collateral Documents,
(2) and, thereafter, for purposes of directing the Collateral Agent with respect
to any of the foregoing actions to be taken under or in respect of the Pledge
Agreement only (and NOT any Loan Guaranty, the Security Agreement, or any
Mortgage), Secured Parties holding or representing 51% or more of the aggregate
amount of the sum of (A) the aggregate outstanding principal amount of the
Existing Senior Notes (only if the Supplemental Indenture Condition has been
satisfied) and (B) the aggregate outstanding principal amount of Refinancing
Senior Debt (to the extent such Refinancing Senior Debt is then secured by
Domestic Collateral) until indefeasible payment in full in cash of such
Refinancing Senior Debt and (only if the Supplemental Indenture Condition has
been satisfied) the Existing Senior Notes and (3) thereafter, for purposes of
directing the Collateral Agent with respect to any of the foregoing actions to
be taken under or in respect of the Pledge Agreement only (and NOT any Loan
Guaranty, the Security Agreement or any Mortgage), Secured Parties holding or
representing 51% or more of the aggregate outstanding principal amount of New
Junior Debt (to the extent such New Junior Debt is then secured by Domestic
Collateral) until indefeasible payment in full in cash of such New Junior Debt.
The Collateral Agent shall not be required to take any action that is, in its
opinion, contrary to law or to the terms of this Agreement, or any of the
Collateral Documents or any of the Loan Guaranties or which would in its opinion
subject it or any of its officers, employees or directors to liability, and the
Collateral Agent shall not be required to take any action under this Agreement
or any of the Collateral Documents or any of the Loan Guaranties, unless and
until the Collateral Agent shall be indemnified to its satisfaction by the
Secured Parties against any and all losses, costs, expenses or liabilities in
connection therewith.
(b) Each Secured Party executing this Agreement or an acknowledgment
hereto agrees that (i) the Collateral Agent may act as Requisite Obligees may
request (regardless of whether any Secured Party or any holder represented
thereby agrees, disagrees or abstains with respect to such request), (ii) the
Collateral Agent shall have no liability for acting in accordance with such
request (provided such action does not conflict with the express terms of this
Agreement) and (iii) no Secured Party or any holder represented thereby shall
have any liability to any other Secured Party or any holder represented thereby
for any such request. The
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Collateral Agent shall give prompt notice to all Secured Parties of actions
taken pursuant to the instructions of Requisite Obligees; PROVIDED, HOWEVER,
that the failure to give any such notice shall not impair the right of the
Collateral Agent to take any such action or the validity or enforceability under
this Agreement or the applicable Collateral Document or Loan Guaranties of the
action so taken.
(c) Each Secured Party agrees that unless and until such Secured
Party is entitled to give direction to the Collateral Agent pursuant to SECTION
2(A) with respect to a Collateral Document or the Loan Guaranties, the only
right of such Secured Party under the Collateral Documents and the Loan
Guaranties is for (i) Other Permitted Credit Exposure, the Interest Rate
Obligations, the Currency Obligations, and the New Senior Debt (collectively,
with the Obligations under the Credit Agreement, the "SENIOR SECURED
OBLIGATIONS") to be secured by the Domestic Collateral, and to receive a share
of the proceeds of such Domestic Collateral or any payments under the Loan
Guaranties, if any, as and when provided in the Collateral Documents and SECTION
3 and SECTION 4(A) hereof, (ii) the Refinancing Senior Debt and (only if the
Supplemental Indenture Condition has been satisfied) the Existing Senior Notes
to be secured by the Domestic Collateral pledged under the Pledge Agreement (the
"SECOND PRIORITY SECURED OBLIGATIONS"), in each case for the period and to the
extent (but only to the extent) provided for in the Pledge Agreement and to
receive a share of the proceeds of such Domestic Collateral, if any, as and when
provided in Section 12 of the Pledge Agreement and SECTION 3 and SECTION 4(A)
hereof, and (iii) the New Junior Debt to be secured by the Domestic Collateral
pledged under the Pledge Agreement (the "THIRD PRIORITY SECURED OBLIGATIONS")
for the period and to the extent (but only to the extent) provided for in the
Pledge Agreement and to receive a share of the proceeds of such Domestic
Collateral, if any, to the extent and at the times provided in Section 12 of the
Pledge Agreement and SECTION 3 and SECTION 4(A) hereof. The Secured Parties that
are not Senior Secured Parties and the New Senior Debt Representatives
acknowledge that they have no rights or remedies under or with respect to any of
the Loan Guaranties.
(d) Notwithstanding anything to the contrary contained herein or in
the Credit Agreement, any Other Permitted Credit Exposure Document, any Interest
Rate Agreement, any Currency Agreement, any Existing Senior Note Indenture (only
if the Supplemental Indenture Condition has been satisfied), any Existing Senior
Notes Subordinated Guaranty (if applicable), any New Senior Debt Document, any
Refinancing Senior Debt Document or any New Junior Debt Document, and
irrespective of
(i) the time, order or method of attachment or perfection of
the security interests created by any Collateral Document,
(ii) the time or order of filing or recording of financing
statements or other documents filed or recorded to perfect security
interests in any Domestic Collateral, and
(iii) the rules for determining priority under the Uniform
Commercial Code or any other law or rule governing the relative priorities
of secured creditors,
any security interest in any Domestic Collateral heretofore or hereafter granted
to secure any Senior Secured Obligations pursuant to any Collateral Document or
otherwise has and shall have
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priority, to the extent of any unpaid Senior Secured Obligations, over any
security interest in such Domestic Collateral granted to secure any Second
Priority Secured Obligations or any Third Priority Secured Obligations and any
security interest in any Domestic Collateral heretofore or hereafter granted to
secure any Second Priority Secured Obligations pursuant to the Pledge Agreement
or otherwise has and shall have priority, to the extent of any unpaid Second
Priority Secured Obligations, over any security interest in such Domestic
Collateral granted to secure any Third Priority Secured Obligations.
(e) The Collateral Agent may at any time request directions from the
Requisite Obligees with respect to the Collateral Documents and the Loan
Guaranties as to any course of action or other matter relating hereto or to any
Collateral Document or any Loan Guaranties. Except as otherwise provided in the
Collateral Documents and the Loan Guaranties, directions given by Requisite
Obligees to the Collateral Agent hereunder shall be binding on all Secured
Parties for all purposes.
(f) Subject to the application of proceeds pursuant to SECTION 4,
Collateral Agent may release the Lien of the Collateral Documents against any
portion of the Domestic Collateral that is the subject of a sale, transfer or
other disposition permitted by the Credit Agreement or otherwise to the extent
approved by the Requisite Obligees.
(g) Each Secured Party agrees that no Secured Party shall have any
right to, and agrees that it shall not take any action whatsoever to enforce any
term or provision of any Collateral Document or any Loan Guaranties or to
enforce any of its rights in respect of the Domestic Collateral, it being
understood that all rights and remedies under the Collateral Documents and the
Loan Guaranties shall be executed exclusively by the Collateral Agent in
accordance with this Agreement. Without limiting any of the foregoing, each
Secured Party agrees that so long as any of the Senior Secured Obligations have
not been indefeasibly paid in full in cash, in any case under the Bankruptcy
Code with respect to a Loan Party, holders of any Existing Senior Notes (only if
the Supplemental Indenture Condition has been satisfied), Refinancing Senior
Debt or New Junior Debt and their respective trustees or representatives, (i)
shall not contest any request by the Lender Agent for adequate protection or
relief from the automatic stay and (ii) shall waive any rights to (A) seek
relief from the automatic stay, (B) object to any election by the holders of
Senior Secured Obligations of the application of Section 1111(b) of the
Bankruptcy Code or (C) to object to a borrowing or grant of security interest by
any Grantor pursuant to Section 364 of the Bankruptcy Code.
SECTION 3. APPLICATION OF PROCEEDS OF SECURITY, LOAN GUARANTY PAYMENTS.
(a) Subject to the provisions of SECTION 4 which shall govern with
respect to the allocation of Net Asset Sale Proceeds of Domestic Collateral or
Net Insurance/Condemnation Proceeds arising therefrom or Net Debt Securities
Proceeds arising from the issuance of Receivables Sales Indebtedness, any and
all amounts actually received by the Collateral Agent in connection with the
enforcement of the Collateral Documents, including the proceeds of any
collection, sale or other disposition of the Domestic Collateral or any portion
thereof (collectively, "PROCEEDS") shall be applied promptly by the Collateral
Agent as follows:
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(i) Proceeds of Domestic Collateral under the Pledge Agreement shall
be applied as follows:
FIRST, to the payment of the costs and expenses of such sale,
collection or other realization, including reasonable compensation to the
Collateral Agent and its agents and counsel, and all expenses, liabilities
and advances made or incurred by the Collateral Agent in connection
therewith and all amounts for which Collateral Agent is entitled to
indemnification hereunder and all advances hereunder for the account of
Grantors, and to the payment of all costs and expenses paid or incurred by
Collateral Agent in connection with the exercise of any right or remedy
hereunder;
SECOND, to the payment of the Senior Secured Obligations (including
any Aggregate Available Amount (as defined in the Security Agreement)
deposits into the L/C Collateral Account for outstanding Letters of
Credit, provided that if such Letters of Credit expire without being fully
drawn, then at that time, such excess amounts shall be applied as provided
in this SECTION 3 to then outstanding Senior Secured Obligations) for the
ratable benefit of the holders thereof; PROVIDED that in making such
application in respect of outstanding obligations under New Senior Debt
Documents, the Collateral Agent shall be entitled to deduct from the share
of such Proceeds otherwise payable to the New Senior Debt Representatives
the New Senior Debt holders' pro rata share of all amounts that the
Collateral Agent has been paid by the Paying Indemnifying Parties (as
defined in SECTION 7(c)) pursuant to SECTION 7(c);
THIRD, only after payment in full of all Senior Secured Obligations
and the Credit Agreement has terminated and the Letters of Credit
cancelled, to the payment of the Second Priority Secured Obligations for
the ratable benefit of the holders thereof; PROVIDED, THAT, that in making
such application in respect of outstanding obligations under the Existing
Senior Notes, the Collateral Agent shall be entitled to deduct from the
share of such Proceeds otherwise payable to the holders of the Existing
Senior Notes (if the Supplemental Indenture Condition has been satisfied),
such holders' pro rata share of all amounts that the Collateral Agent has
been paid by the Paying Indemnifying Parties pursuant to SECTION 7(c),
PROVIDED, FURTHER, that in making such application in respect of
obligations outstanding under Refinancing Senior Debt Documents, the
Collateral Agent shall be entitled to deduct from the share of such
Proceeds otherwise payable to the holders of such Refinancing Senior Debt
Representatives such Refinancing Senior Debt holders' pro rata share of
all amounts that the Collateral Agent has been paid by the Paying
Indemnifying Parties pursuant to SECTION 7(c);
FOURTH, only after payment in full of all Senior Secured Obligations
and all Second Priority Secured Obligations, to the payment of the Third
Priority Secured Obligations for the ratable benefit of the holders
thereof; PROVIDED, THAT, in making such application in respect of
obligations outstanding under New Junior Debt Documents, the Collateral
Agent shall be entitled to deduct from the share of such Proceeds
otherwise payable to the holders of such New Junior Debt such New Junior
Debt holders' pro rata share of all amounts that the Collateral Agent has
been paid by the Paying Indemnifying Parties pursuant to SECTION 7(c); and
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FIFTH, after payment in full of all Secured Obligations, to
applicable Pledgor, or its successors or assigns, or to whomsoever may be
lawfully entitled to receive the same or as a court of competent
jurisdiction may direct, of any surplus then remaining from such Proceeds.
(ii) Proceeds of Domestic Collateral pledged pursuant to the
Security Agreement or any Mortgage shall be applied as follows:
FIRST, to the payment of all costs and expenses of such sale,
collection or other realization, including reasonable compensation to
Collateral Agent and its agents and counsel, and all other expenses,
liabilities and advances made or incurred by Collateral Agent in
connection therewith, and all amounts for which Collateral Agent is
entitled to indemnification hereunder and all advances made by Collateral
Agent hereunder for the account of Grantors, and to the payment of all
costs and expenses paid or incurred by Collateral Agent in connection with
the exercise of any right or remedy hereunder;
SECOND, to the ratable payment of all other Senior Secured
Obligations (including any Aggregate Available Amount (as defined in the
Security Agreement) deposits into the L/C Collateral Account for
outstanding Letters of Credit, provided that if such Letters of Credit
expire without being fully drawn, then at that time, such excess amounts
shall be applied as provided in this SECTION 3 to then outstanding Senior
Secured Obligations) secured by the Security Agreement and the Mortgages
(for the ratable benefit of the holders thereof) and, as to obligations
arising under the Credit Agreement, as provided in the Credit Agreement;
PROVIDED that in making such application in respect of outstanding
obligations under New Senior Debt Documents, the Collateral Agent shall be
entitled to deduct from the share of such Proceeds otherwise payable to
the New Senior Debt Representatives the New Senior Debt holders' pro rata
share of all amounts that the Collateral Agent has been paid by the Paying
Indemnifying Parties pursuant to SECTION 7(c); and
THIRD, to the payment to or upon the order of the applicable
Grantor, or to whosoever may be lawfully entitled to receive the same or
as a court of competent jurisdiction may direct, of any surplus then
remaining from such proceeds.
Until Proceeds are so applied, the Collateral Agent shall hold such
Proceeds in its custody in accordance with its regular procedures for handling
deposited funds.
(iii) Any and all amounts actually received by the Collateral Agent
in connection with the enforcement of the Loan Guaranties (collectively, "LOAN
GUARANTY PAYMENTS") shall be applied as follows:
FIRST, to the payment of all costs and expenses of such sale,
collection or other realization, including reasonable compensation to
Collateral Agent and its agents and counsel, and all other expenses,
liabilities and advances made or incurred by Collateral Agent in
connection therewith, and all amounts for which Collateral Agent is
entitled to indemnification hereunder and all advances made by Collateral
Agent hereunder for the account of Loan Guarantors, and to the payment of
all costs and expenses paid or incurred by Collateral Agent in connection
with the exercise of any right or remedy hereunder;
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SECOND, to the ratable payment of all other Guarantied Obligations
(as defined below), (including any Aggregate Available Amount (as defined
in the Security Agreement) deposited into the L/C Collateral Account for
outstanding Letters of Credit, provided that if such Letters of Credit
expire without being fully drawn, then at that time, such excess amounts
shall be applied as provided in this SECTION 3 to then outstanding
Guarantied Obligations) (for the ratable benefit of the holders thereof);
and
THIRD, to the payment to or upon the order of the applicable Loan
Guarantor, or to whosoever may be lawfully entitled to receive the same or
as a court of competent jurisdiction may direct, of any surplus then
remaining from such proceeds.
Until such Loan Guaranty Payments are so applied, the Collateral Agent
shall hold such Loan Guaranty Payments in its custody in accordance with its
regular procedures for handling deposited funds. Any Loan Guaranty Payments
received by the Collateral Agent relating to the Obligations, the Interest Rate
Obligations, the Currency Obligations and the Other Permitted Credit Exposure
("GUARANTIED OBLIGATIONS") shall be applied so that each Secured Party with
respect thereto shall receive payment of the same proportionate amount of all
such Guarantied Obligations.
(b) Subject to the provisions of SECTION 4 which shall govern with
respect to the allocation of Net Asset Sale Proceeds of Domestic Collateral, Net
Insurance/Condemnation Proceeds arising therefrom or Net Debt Securities
Proceeds arising from the issuance of Receivables Sale Indebtedness, (i) any
Proceeds received by the Collateral Agent to be distributed under SECTION 3(a)
to payment of the Senior Secured Obligations shall be applied so that each
Secured Party with respect thereto that is then secured by the Domestic
Collateral giving rise to such Proceeds shall receive payment of the same
proportionate amount of all such Senior Secured Obligations, (ii) any Proceeds
received by the Collateral Agent to be distributed under SECTION 3(a) to payment
of the Second Priority Secured Obligations shall be applied so that each Secured
Party with respect thereto that is then secured by the Domestic Collateral
giving rise to such Proceeds shall receive payment of the same proportionate
amount of all such Second Priority Secured Obligations and, (iii) any Proceeds
received by the Collateral Agent to be distributed under SECTION 3(A) to payment
of the Third Priority Secured Obligations shall be applied so that each Secured
Party with respect thereto that is then secured by the Domestic Collateral
giving rise to such Proceeds shall receive payment of the same proportionate
amount of all such Third Priority Secured Obligations. For purposes of
determining the proportionate amounts of all Senior Secured Obligations when
Proceeds are to be distributed under this SECTION 3, the amount of the
outstanding Obligations, Other Permitted Credit Exposure and New Senior Debt,
respectively, shall be deemed to be the principal and interest or face amount,
as applicable, then due and payable under the Credit Agreement, the Other
Permitted Credit Exposure Documents (to the extent such Other Permitted Credit
Exposure is then secured by the Domestic Collateral pursuant to the applicable
Collateral Documents), the New Senior Debt Documents (to the extent that the New
Senior Debt with respect thereto is then secured by the Domestic Collateral
under the applicable Collateral Documents), and the amount of the outstanding
Interest Rate Obligations and Currency Obligations of any Interest Rate
Exchanger or Currency Exchanger shall be deemed to be the amount of the
Company's obligations then due and payable (exclusive of expenses or similar
liabilities but including any early termination payments then due) under the
applicable Interest Rate Agreements or Currency Agreements. For purposes of
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determining the proportionate amounts of all Second Priority Secured Obligations
when Proceeds are to be distributed under this SECTION 3, the amount of the
outstanding Second Priority Secured Obligations in respect of the Refinancing
Senior Debt and Existing Senior Notes, (if the Supplemental Indenture Condition
has been satisfied) respectively shall be deemed to be the principal and
interest then due and payable under the Refinancing Senior Debt Documents (to
the extent such Refinancing Senior Debt with respect thereto is then secured by
the Domestic Collateral under the Pledge Agreement) and (only if the
Supplemental Indenture Condition has been satisfied) the Existing Senior Notes.
For purposes of determining the proportionate amounts of all Third Priority
Secured Obligations at the time any Proceeds are to be distributed under this
SECTION 3, the amount of outstanding New Junior Debt shall be deemed to be the
principal and interest then due and payable under the New Junior Debt Documents
(to the extent such New Junior Debt is then secured by the Domestic Collateral
under the Pledge Agreement).
(c) Payments by the Collateral Agent to the Lenders on account of
Proceeds received by Collateral Agent in respect of the Obligations shall be
made to the Lender Agent for distribution to the Lenders in accordance with the
Credit Agreement and as follows: (i) any payments in respect of Interest Rate
Obligations and Currency Obligations shall be made as directed by the Lender or
affiliate thereof to which such Interest Rate Obligations or Currency
Obligations are owed; (ii) any payments in respect of Other Permitted Credit
Exposure shall be made as directed by the Other Permitted Credit Exposure Holder
to which obligations under such Other Permitted Credit Exposure are owed; (iii)
any payments in respect of any New Senior Debt shall be paid to the applicable
New Senior Debt Representative for the benefit of the holders of such New Senior
Debt; (iv) (only if the Supplemental Indenture Condition has been satisfied) any
payments in respect of any Existing Senior Notes shall be paid to the applicable
Existing Senior Note Trustee for the benefit of holders of such Existing Senior
Notes; (v) any payments in respect of any Refinancing Senior Debt shall be paid
to the applicable Refinancing Senior Debt Representative for the benefit of the
holders of such Refinancing Senior Debt; and (vi) any payments in respect of any
New Junior Debt shall be paid to the applicable New Junior Debt Representative
for the benefit of the holders of such New Junior Debt.
SECTION 4. ALLOCATION OF PROCEEDS FROM ASSET SALES AND NET INSURANCE
CONDEMNATION PROCEEDS OF DOMESTIC COLLATERAL, NET DEBT SECURITIES PROCEEDS AND
RECEIVABLES SALE INDEBTEDNESS. The Lender Agent acting on behalf of the Lenders,
each Interest Rate Exchanger, each Currency Exchanger, each Other Permitted
Credit Exposure Holder and each New Senior Debt Representative executing this
Agreement or an acknowledgment hereto, acting on behalf of the holders of New
Senior Debt, each Existing Senior Note Trustee, acting on behalf of the holders
of the Existing Senior Notes, each Refinancing Senior Debt Representative
executing an acknowledgment to this Agreement, acting on behalf of such holders
of Refinancing Senior Debt, and each New Junior Debt Representative executing
this Agreement or an acknowledgement hereto, acting on behalf of the holders of
New Junior Debt, agree, INTER SE, that Net Asset Sale Proceeds of Domestic
Collateral and any Net Insurance/Condemnation Proceeds arising from damage to,
destruction of or condemnation of Domestic Collateral and Net Debt Securities
Proceeds arising from the issuance of Receivables Sales Indebtedness relating to
Domestic Collateral shall be allocated as provided in this SECTION 4. Company,
Packaging and the other Subsidiary Guarantors agree that any Net Asset Sale
Proceeds of Domestic Collateral or Net Insurance/Condemnation Proceeds arising
therefrom or any Net Debt Securities Proceeds arising from the issuance of
Receivables Sale Indebtedness
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relating to Domestic Collateral shall be applied at the times, if any, required
under the Credit Agreement as provided in SECTION 4(a).
(a) Upon the occurrence of (i) an Asset Sale of Domestic Collateral
which requires a prepayment of the Obligations as provided in the Credit
Agreement or (ii) an event giving rise to Net Insurance/Condemnation Proceeds
arising from damage to, destruction of or condemnation of Domestic Collateral or
the issuance of Receivables Sale Indebtedness relating to Domestic Collateral
giving rise to Net Debt Securities Proceeds which in each case requires a
prepayment of the Obligations as provided in the Credit Agreement, the
applicable Net Asset Sale Proceeds or Net Insurance/Condemnation Proceeds or Net
Debt Securities Proceeds shall be applied to the payment in cash in full of, to
the extent required under the Credit Agreement, the Obligations, and, to the
extent but only to the extent expressly required by the applicable Financing
Documents the obligations in respect of New Senior Debt (to the extent such New
Senior Debt is then secured by the applicable Domestic Collateral) in proportion
to their respective outstanding amounts of principal and interest, as the case
may be. The allocation set forth in this paragraph (a) shall apply in all
circumstances including, without limitation, with respect to any case or
proceeding under any bankruptcy law or insolvency law involving creditors'
rights generally.
(b) To the extent received by Company, Packaging or any other
Subsidiary Guarantor such entity shall pay to the Collateral Agent all of the
Net Asset Sale Proceeds, Net Insurance/Condemnation Proceeds and Net Debt
Securities Proceeds, which are payable under SECTION 4(a). Any such payments
received by the Collateral Agent directly or pursuant to this SECTION 4(b) shall
be distributed to the relevant parties as provided in SECTION 3(c).
SECTION 5. INFORMATION. In the event the Collateral Agent proceeds to
foreclose upon, collect, sell or otherwise dispose of or take any other action
with respect to the Domestic Collateral, or any portion thereof, or to enforce
any Collateral Document, or proposes to take any other action pursuant to this
Agreement or requests instructions from the Secured Parties as provided herein,
upon the request of the Collateral Agent, each of the following Secured Parties
agrees to provide promptly to the Collateral Agent the following information:
(a) The Lender Agent on behalf of the Lenders agrees to promptly
from time to time notify the Collateral Agent of (i) the aggregate amount of
principal of and interest on the Obligations as at such date as the Collateral
Agent may specify, (ii) the current Commitment of each Lender under the Credit
Agreement, and (iii) any payment received by the Lender Agent to be applied to
the principal of or interest on the Obligations. The Lender Agent shall certify
as to such amounts and the Collateral Agent shall be entitled to rely
conclusively upon such certification.
(b) Each Lender or Affiliate thereof party to an Interest Rate
Agreement benefited by this Agreement, by signing an acknowledgment to this
Agreement, agrees to promptly from time to time notify the Collateral Agent of
(i) the notional amount under such Interest Rate Agreement and the amount
payable by the Company upon early termination of such Interest Rate Agreement at
the date of termination as fixed by such Interest Rate Agreement and (ii) any
payment received by such Lender to be applied to amounts due upon early
termination of such
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Interest Rate Agreement. Such Lender shall certify as to such amounts and the
Collateral Agent shall be entitled to rely conclusively upon such certification.
(c) Each Lender or Affiliate thereof party to a Currency Agreement
benefited by this Agreement, by signing an acknowledgment to this Agreement,
agrees to promptly from time to time notify the Collateral Agent of (i) the
notional amount under such Currency Agreement and the amount payable by the
Company upon early termination of such Currency Agreement at the date of
termination as fixed by such Currency Agreement and (ii) any payment received by
such Lender to be applied to amounts due upon early termination of such Currency
Agreement. Such Lender shall certify as to such amounts and the Collateral Agent
shall be entitled to rely conclusively upon such certification.
(d) Each Other Permitted Credit Exposure Holder benefiting from an
Other Permitted Credit Exposure Guaranty benefited by this Agreement, by
executing this Agreement or signing an acknowledgment to this Agreement, as the
case may be, agrees to promptly from time to time notify the Collateral Agent of
(i) the aggregate amount of principal and interest outstanding with respect to
the Other Permitted Credit Exposure to which such Other Permitted Credit
Exposure Guaranty relates, whether such amounts are fully guarantied by such
Other Permitted Credit Exposure Guaranty and the amount, if any, then due and
payable under such Other Permitted Credit Exposure Guaranty, as at such date as
the Collateral Agent may specify and (ii) any payment received by such Other
Permitted Credit Exposure Holder to be applied to the principal of or interest
on the amounts due with respect to the Other Permitted Credit Exposure and such
Other Permitted Credit Exposure Guaranty. The Other Permitted Credit Exposure
Holder shall certify as to such amounts and the Collateral Agent shall be
entitled to rely conclusively upon such certification.
(e) Each New Senior Debt Representative with respect to New Senior
Debt benefited by this Agreement, by executing this Agreement or signing an
acknowledgment to this Agreement, as the case may be, agrees to promptly from
time to time notify the Collateral Agent of (i) the aggregate amount of
principal and interest outstanding under the applicable New Senior Debt
Documents and the amount, if any, then due and payable under such New Senior
Debt Documents, as at such date as the Collateral Agent may specify and (ii) any
payment received by such New Senior Debt Representative to be applied to the
principal of or interest on the amounts due with respect to such New Senior Debt
and such New Senior Debt Documents. The New Senior Debt Representative shall
certify as to such amounts and the Collateral Agent shall be entitled to rely
conclusively upon such certification.
(f) Each Refinancing Senior Debt Representative with respect to
Refinancing Senior Debt benefited by this Agreement, by executing this Agreement
or signing an acknowledgment to this Agreement, as the case may be, agrees to
promptly from time to time notify the Collateral Agent of (i) the aggregate
amount of principal and interest outstanding under the applicable Refinancing
Senior Debt Documents and the amount, if any, then due and payable under such
Refinancing Senior Debt Documents, as at such date as the Collateral Agent may
specify and (ii) any payment received by such Refinancing Senior Debt
Representative to be applied to the principal of or interest on the amounts due
with respect to such Refinancing Senior Debt and such Refinancing Senior Debt
Documents. The Refinancing Senior Debt
15
Representative shall certify as to such amounts and the Collateral Agent shall
be entitled to rely conclusively upon such certification.
(g) Only if the Supplemental Indenture Condition has been satisfied,
Collateral Agent may from time to time request each Existing Senior Note Trustee
to notify the Collateral Agent of the outstanding principal amount of the
Existing Senior Notes for which it is trustee and the amount of accrued but
unpaid interest thereon, at such date as the Collateral Agent may specify and
for each Existing Senior Note Trustee to, or cause the registrar for the
Existing Senior Notes for which it is trustee to, certify as to such amount as
reflected in the register maintained for such purpose by such Existing Senior
Note Trustee or such registrar, as the case may be, and to the extent any such
Existing Senior Note Trustee or registrar so certifies, the Collateral Agent
shall be entitled to rely conclusively upon such certification. If one or more
Existing Senior Note Trustees fail to respond to such a request by Collateral
Agent, Collateral Agent may rely conclusively on the records of Company for
purposes of determining the outstanding principal amount of the Existing Senior
Notes and/or the amount of accrued but unpaid interest thereon.
(h) Each New Junior Debt Representative with respect to New Junior
Debt benefited by this Agreement, by executing this Agreement or signing an
acknowledgment to this Agreement, as the case may be, agrees to promptly from
time to time notify the Collateral Agent of (i) the aggregate amount of
principal and interest outstanding under the applicable Refinancing Senior Debt
Documents and the amount, if any, then due and payable under such Senior
Refinancing Debt Documents, as at such date as the Collateral Agent may specify
and (ii) any payment received by such New Junior Debt Representative to be
applied to the principal of or interest on the amounts due with respect to such
New Junior Debt and such New Junior Debt Documents. The New Junior Debt
Representative shall certify as to such amounts and the Collateral Agent shall
be entitled to rely conclusively upon such certification.
SECTION 6. INTEREST RATE AGREEMENTS; CURRENCY AGREEMENTS; OTHER PERMITTED
CREDIT EXPOSURE DOCUMENTS; NEW SENIOR DEBT DOCUMENTS;
REFINANCING SENIOR DEBT DOCUMENTS; NEW JUNIOR DEBT DOCUMENTS.
(a) Each Lender or respective Affiliate thereof may cause Interest
Rate Obligations and Currency Obligations to be secured by the Collateral
Documents and guaranteed by the Loan Guaranties by executing an acknowledgment
in the form contained on the signature pages hereof, and by delivering such
executed acknowledgment (which to be effective must be acknowledged by the
Borrowers' Agent) to the Collateral Agent, by which such Lender Affiliate
thereof agrees to be bound by the terms of this Agreement.
(b) Each Other Permitted Credit Exposure Holder may cause its
respective Other Permitted Credit Exposure Documents to be secured by the
Collateral Documents and guaranteed by the Loan Guaranties by executing an
acknowledgment in the form contained on the signature pages hereof, and by
delivering such executed acknowledgment (which to be effective must be
acknowledged by the Borrowers' Agent) to the Collateral Agent, by which such
Other Permitted Credit Exposure Holder agrees to be bound by the terms of this
Agreement.
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(c) The holders of each issue of New Senior Debt may cause such New
Senior Debt to be secured by the Collateral Documents by causing their New
Senior Debt Representative to execute an acknowledgement in the form contained
on the signature pages hereof, and by delivering such executed acknowledgement
(which to be effective must be acknowledged by the Borrowers' Agent) to the
Collateral Agent, by which such New Senior Debt Representative agrees to be
bound by the terms of this Agreement.
(d) The holders of each issue of Refinancing Senior Debt may cause
such Refinancing Senior Debt to be secured by the Pledge Agreement by causing
their Refinancing Senior Debt Representative to execute an acknowledgement in
the form contained on the signature pages hereof and by delivering such executed
acknowledgement (which to be effective must be acknowledged by Company and
Packaging) to the Collateral Agent, by which such Refinancing Senior Debt
Representative agrees to be bound by the terms of this Agreement.
(e) The holders of each issue of New Junior Debt may cause such New
Junior Debt to be secured by the Pledge Agreement by causing their New Junior
Debt Representative to execute an acknowledgement in the form contained on the
signature pages hereof and by delivering such executed acknowledgement (which to
be effective must be acknowledged by Company and Packaging) to the Collateral
Agent, by which such New Junior Debt Representative agrees to be bound by the
terms of this Agreement.
SECTION 7. DISCLAIMERS, INDEMNITY, ETC.
(a) The Collateral Agent shall have no duties or responsibilities
except those expressly set forth in this Agreement, the Collateral Documents or
the Loan Guaranties, and the Collateral Agent shall not by reason of this
Agreement, the Collateral Documents or the Loan Guaranties be a trustee for any
Secured Party or have any other fiduciary obligation to any Secured Party
(including any obligation under the Trust Indenture Act of 1939, as amended).
The Collateral Agent shall not be responsible to any Secured Party for any
recitals, statements, representations or warranties contained in this Agreement,
the Credit Agreement, the Interest Rate Agreements, the Currency Agreements, the
Other Permitted Credit Exposure Guaranties or any other documents evidencing or
relating to any Other Permitted Credit Exposure, the New Senior Debt Documents,
the Existing Senior Note Indentures, the Existing Senior Notes, the Existing
Senior Notes Subordinated Guaranty, the Refinancing Senior Debt Documents, the
New Junior Debt Documents, the Collateral Documents or the Loan Guaranties
(collectively, the "FINANCING AGREEMENTS") or in any certificate or other
document referred to or provided for in, or received by any of them under, any
of the Financing Agreements, or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of any of the Financing Agreements or
any other document referred to or provided for therein or any Lien under the
Collateral Documents or the perfection or priority of any such Lien or for any
failure by any Party to perform any of its respective obligations under any of
the Financing Agreements. The Collateral Agent may employ agents and
attorneys-in-fact and shall not be responsible, except as to money or securities
received by it or its authorized agents, for the negligence or misconduct of any
such agents or attorneys-in-fact selected by it with reasonable care. Neither
the Collateral Agent nor any of its directors, officers, employees or agents
shall be liable or responsible for any action taken or omitted to be taken by it
or them hereunder or in connection herewith, except for its or their own gross
negligence or willful misconduct.
17
(b) The Collateral Agent shall be entitled to rely upon any
certification, notice or other communication (including any thereof by telex,
telecopy, telegram or cable) believed by it to be genuine and correct and to
have been signed or sent by or on behalf of the proper Person or Persons, and
upon advice and statements of legal counsel (including counsel to Holdings or
any Subsidiary of Holdings), independent accountants and other experts selected
by the Collateral Agent. As to any matters not expressly provided for by this
Agreement, the Collateral Agent shall in all cases be fully protected in acting,
or in refraining from acting, hereunder in accordance with instructions signed
by Requisite Obligees, and such instructions of Requisite Obligees, and any
action taken or failure to act pursuant thereto, shall be binding on all of the
Secured Parties.
(c) The Lender Agent on behalf of the Lenders, each Interest Rate
Exchanger, each Currency Exchanger and each Other Permitted Credit Exposure
Holder (collectively, the "PAYING INDEMNIFYING PARTIES") agrees that the Secured
Parties represented by it shall indemnify the Collateral Agent, ratably in
accordance with the amount of the obligations held by such Secured Parties
secured by the Collateral Documents, to the extent neither reimbursed by any
Grantor under any Collateral Document nor reimbursed out of any Proceeds
pursuant to SECTION 3 hereof and the corresponding provisions of the Collateral
Documents for any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind and
nature whatsoever which may be imposed on, incurred by or asserted against the
Collateral Agent in any way relating to or arising out of any of the Financing
Agreements or any other documents contemplated by or referred to therein or the
transactions contemplated thereby or the enforcement of any of the terms of any
thereof; PROVIDED, HOWEVER, that no such Secured Party shall be liable for any
of the foregoing to the extent they arise from the gross negligence or willful
misconduct of the Collateral Agent. Each New Senior Debt Representative, on
behalf of such New Senior Debt Representative and the holders in respect of
which such New Senior Debt Representative is the Representative, agrees that, as
provided in SECTION 3 hereof, Section 12 of the Pledge Agreement, Section 18 of
the Security Agreement and the application of proceeds provision of each
Mortgage deductions from distributions otherwise due with respect to such New
Senior Debt will be made so that the holders of such New Senior Debt shall share
with the Paying Indemnifying Parties, ratably in accordance with the amount of
New Senior Debt secured by the Collateral Documents, the payment of the amounts
due under the preceding sentence. As provided in SECTION 3 hereof, and Section
12 of the Pledge Agreement and only if the Supplemental Indenture Condition has
been satisfied, deductions from distributions otherwise due with respect to the
Existing Senior Note Trustee on behalf of the holders of Existing Senior Notes
will be made so that such holders of Existing Senior Notes shall share with the
Paying Indemnifying Parties, ratably in accordance with the amount (without
duplication) of such Existing Senior Notes secured by the Pledge Agreement, the
payment of the amounts due under the second preceding sentence. Each Refinancing
Senior Debt Representative, on behalf of such Refinancing Senior Debt
Representative and the holders in respect of which such Refinancing Senior Debt
Representative is the Refinancing Senior Debt Representative, agrees that, as
provided in SECTION 3 hereof, and Section 12 of the Pledge Agreement, deductions
from distributions otherwise due with respect to such Refinancing Senior Debt
will be made so that the holders of such Refinancing Senior Debt will share with
the Paying Indemnifying Parties, ratably in accordance with the amount of
Refinancing Senior Debt secured by the Pledge Agreement, the payment of the
amounts due under the third preceding sentence. Each New Junior Debt
Representative, on behalf of such New Junior Debt Representative and
18
the holders in respect of which such New Junior Debt Representative is the New
Junior Debt Representative, agrees that, as provided in and SECTION 3 hereof,
and Section 12 of the Pledge Agreement, deductions from distributions otherwise
due with respect to such New Junior Debt will be made so that the holders of
such New Junior Debt will share with the Paying Indemnifying Parties, ratably in
accordance with the amount of New Junior Debt secured by the Pledge Agreement,
the payment of the amounts due under the fourth preceding sentence.
(d) Except for action expressly required of the Collateral Agent
hereunder, the Collateral Agent shall, notwithstanding anything to the contrary
in SECTION 7(c) hereof, in all cases be fully justified in failing or refusing
to act hereunder unless it shall be further indemnified to its satisfaction by
the Secured Parties against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action.
(e) The Collateral Agent may deem and treat the payee of any
promissory note or other evidence of indebtedness relating to the Senior Secured
Obligations, Second Priority Secured Obligations or Third Priority Secured
Obligations as the owner thereof for all purposes hereof unless and until a
written notice of the assignment or transfer thereof, signed by such payee and
in form satisfactory to the Collateral Agent, shall have been filed with the
Collateral Agent. Any request, authority or consent of any Person who at the
time of making such request or giving such authority or consent is the holder of
any such note or other evidence of indebtedness shall be conclusive and binding
on any subsequent holder, transferee or assignee of such note or other evidence
of indebtedness and of any note or notes or other evidences of indebtedness
issued in exchange therefor.
(f) Except as expressly provided herein and in the Collateral
Documents, the Collateral Agent shall have no duty to take any affirmative steps
with respect to the collection of amounts payable in respect of the Domestic
Collateral. The Collateral Agent shall incur no liability to any Secured Party
as a result of any sale of any Domestic Collateral at any private sale.
(g) (i) Until such time as the Senior Secured Obligations shall have
been indefeasibly paid in full, the Collateral Agent may resign at any time by
giving at least 30 days' notice thereof to the Secured Parties (such resignation
to take effect as hereinafter provided) and the Collateral Agent may be removed
as Collateral Agent at any time by Requisite Obligees. In the event of such
resignation or removal of the Collateral Agent, Requisite Obligees shall
thereupon have the right to appoint a successor Collateral Agent. If no
successor Collateral Agent shall have been so appointed by Requisite Obligees
and shall have accepted such appointment within 30 days after the notice of the
intent of the Collateral Agent to resign, then the retiring Collateral Agent
may, on behalf of the other Secured Parties, appoint a successor Collateral
Agent. Any successor Collateral Agent appointed pursuant to this clause (i) (A)
shall be a commercial bank organized under the laws of the United States of
America or any state thereof and having a combined capital and surplus of at
least $500,000,000 and (B) unless an Event of Default or Potential Event of
Default shall have occurred and be continuing, shall be approved by Company.
(ii) After the indefeasible payment in full in cash of the Senior
Secured Obligations and until such time as the Second Priority Secured
Obligations are paid in full, the
19
Collateral Agent may resign at any time by giving at least 30 days' notice
thereof to each Existing Senior Note Trustee only if the Existing Senior Notes
are then secured by any of the Domestic Collateral), and each Refinancing Senior
Debt Representative (to the extent such Refinancing Senior Debt is then secured
by any of the Domestic Collateral), (such resignation to take effect as
hereinafter provided) and the Collateral Agent may be removed as Collateral
Agent at any time by the appropriate Requisite Obligees. In the event of any
such resignation or removal of the Collateral Agent, such Requisite Obligees
shall thereupon have the right to appoint a successor Collateral Agent. If no
successor Collateral Agent shall have been so appointed within 30 days after the
notice of the intent of the Collateral Agent to resign, then the retiring
Collateral Agent may, on behalf of the Requisite Obligees, appoint a successor
Collateral Agent. Any successor Collateral Agent appointed pursuant to this
clause (ii) (A) shall be a commercial bank organized under the laws of the
United States of America or any state thereof and having a combined capital and
surplus of at least $500,000,000 and (B) unless an Event of Default or Potential
Event of Default shall have occurred and be continuing, shall, unless such
successor Collateral Agent is appointed by the retiring Collateral Agent, be
approved by Company.
(iii) After the indefeasible payment in full in cash of all Senior
Secured Obligations and Second Priority Secured Obligations and until such time
as the Third Priority Secured Obligations are paid in full, the Collateral Agent
may resign at any time by giving at least 30 days' notice thereof to each New
Junior Debt Representative (to the extent such New Junior Debt is then secured
by any of the Domestic Collateral), (such resignation to take effect as
hereinafter provided) and the Collateral Agent may be removed as Collateral
Agent at any time by the appropriate Requisite Obligees. In the event of any
such resignation or removal of the Collateral Agent, such Requisite Obligees
shall thereupon have the right to appoint a successor Collateral Agent. If no
successor Collateral Agent shall have been so appointed within 30 days after the
notice of the intent of the Collateral Agent to resign, then the retiring
Collateral Agent may, on behalf of the Requisite Obligees, appoint a successor
Collateral Agent. Any successor Collateral Agent appointed pursuant to this
clause (iii) (A) shall be a commercial bank organized under the laws of the
United States of America or any state thereof and having a combined capital and
surplus of at least $500,000,000 and (B) unless an Event of Default or Potential
Event of Default shall have occurred and be continuing, shall, unless such
successor Collateral Agent is appointed by the retiring Collateral Agent, be
approved by Company.
(iv) Upon the acceptance of any appointment as Collateral Agent
hereunder by a successor Collateral Agent, such successor Collateral Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Collateral Agent, and the retiring or
removed Collateral Agent shall thereupon be discharged from its duties and
obligations hereunder. After any retiring or removed Collateral Agent's
resignation or removal hereunder as Collateral Agent, the provisions of this
SECTION 7 shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as the Collateral Agent.
(v) In no event shall Collateral Agent or any Secured Party be
liable or responsible for any funds or investments of funds held by any Grantor
or any affiliates thereof.
20
SECTION 8. NO IMPAIRMENT OF SUBORDINATION IN RIGHTS OF PAYMENT. Each New
Junior Debt Representative agrees, which agreement shall be binding upon each
and every holder of the New Junior Debt, that the agreements and obligations of
the holders of the New Junior Debt relating to the subordination of the right of
payment of the holders of the New Junior Debt to the prior payment of "Senior
Indebtedness" or terms of similar import shall not be impaired in any manner by
the pledge of the Domestic Collateral and the security interest granted under
the Pledge Agreement or the exercise of any rights provided thereunder and that
the rights of the holders of such "Senior Indebtedness" shall not be impaired in
any manner by any such action.
SECTION 9. MISCELLANEOUS.
(a) All notices and other communications provided for herein shall
be in writing and may be personally served, telecopied, telexed or sent by
United States mail and shall be deemed to have been given when delivered in
person, upon receipt of telecopy or telex or four Business Days after deposit in
the United States mail, registered or certified, with postage prepaid and
properly addressed. For the purposes hereof, the addresses of the parties hereto
(until notice of a change thereof is delivered as provided in this SECTION 9(A))
shall be as set forth under each party's name on the signature pages (including
acknowledgments) hereof.
(b) This Agreement may be modified or waived only by an instrument
or instruments in writing signed by the Collateral Agent and the Lender Agent
with the written consent of Requisite Obligees, except that any modification or
waiver adversely affecting a Secured Party's rights under Section 3 or 4 hereof
shall require the written consent of such Secured Party; PROVIDED, HOWEVER that,
notwithstanding the foregoing, the written consent of the Secured Parties shall
not be required with respect to amendments, modifications or waivers necessary
to permit the incurrence of additional Indebtedness secured by the Domestic
Collateral and entitled to the benefits of the Pledge Agreement, the Security
Agreement and/or the Mortgages insofar as the foregoing is not prohibited by the
Financing Agreements benefiting such Secured Party, including for the purposes
of providing any successor or replacement credit agreement or bank facility with
substantially the same or similar benefits, rights and priorities hereunder as
the Credit Agreement, and including without limitation any amendments,
modifications or waivers for the purpose of adding appropriate references to
additional parties in, and according such parties the benefits of, any of the
provisions hereof in connection with the incurrence of such Indebtedness.
(c) This Agreement shall be binding upon and inure to the benefit of
the Collateral Agent, each Secured Party and their respective successors and
assigns.
(d) This Agreement may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instrument, and
any of the parties hereto may execute this Agreement by signing any such
counterpart.
(e) This Agreement shall become effective as to the Lenders, the
Lender Agent and the current Other Permitted Credit Exposure Holders listed on
the signature pages hereof, and the Collateral Agent upon the execution of this
Agreement by the Lender Agent and each current Other Permitted Credit Exposure
Holder and the Collateral Agent and the delivery of each such Person's
counterparts to the Collateral Agent. This Agreement shall become effective
21
as to each Interest Rate Exchanger, each Currency Exchanger, each future Other
Permitted Credit Exposure Holder, each New Senior Debt Representative, each
Refinancing Senior Debt Representative, and each New Junior Debt Representative,
respectively, upon the execution of an acknowledgment by any such Person or its
representative as contemplated by SECTION 6 and delivery of such executed
acknowledgment (which to be effective shall also be acknowledged by the
Borrowers' Agent) to the Collateral Agent or with respect to the Existing Senior
Note Trustees, if they deliver such executed acknowledgement or if the
Supplemental Indenture Condition has been satisfied.
(f) Collateral Agent shall at all times be the same Person that is
Administrative Agent under the Credit Agreement. Written notice of resignation
by Administrative Agent pursuant to subsection 8.6 of the Credit Agreement shall
also constitute notice of resignation as Collateral Agent under this Agreement
and each of the Collateral Documents; removal of Administrative Agent pursuant
to subsection 8.6 of the Credit Agreement shall also constitute removal as
Collateral Agent under this Agreement and each of the Collateral Documents; and
appointment of a successor Administrative Agent pursuant to subsection 8.6 of
the Credit Agreement shall also constitute appointment of a successor Collateral
Agent under this Agreement and each of the Collateral Documents. Upon the
acceptance of any appointment as Administrative Agent under subsection 8.6 of
the Credit Agreement by a successor Administrative Agent, that successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring or removed Collateral
Agent under this Agreement, and the retiring or removed Collateral Agent under
this Agreement shall promptly (i) transfer to such successor Collateral Agent
all sums, securities and other items of Collateral held hereunder or under the
Collateral Documents, together with all records and other documents necessary or
appropriate in connection with the performance of the duties of the successor
Collateral Agent under this Agreement and the Collateral Documents, and (ii)
execute and deliver to such successor Collateral Agent such amendments to
financing statements, and take such other actions, as may be necessary or
appropriate in connection with the assignment to such successor Collateral Agent
of the security interests created under the Collateral Documents, whereupon such
retiring or removed Collateral Agent shall be discharged from its duties and
obligations under this Agreement and each of the Collateral Documents. After any
retiring or removed Administrative Agent's resignation or removal hereunder as
Collateral Agent, the provisions of this Agreement shall inure to its benefit as
to any actions taken or omitted to be taken by it under this Agreement while it
was Collateral Agent hereunder.
(g) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
(h) Anything contained in this Agreement to the contrary
notwithstanding, each party to this Agreement shall no longer be a party from
and after such time as all of the obligations owing such party and secured by
any of the Collateral Documents or guaranteed by any of the Loan Guaranties, or
the instruments representing the same, shall have ceased to be outstanding by
virtue of the payment in full in cash thereof or the cancellation thereof or
delivery for cancellation thereof in accordance with their terms.
[Remainder of page intentionally left blank]
22
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
BANKERS TRUST COMPANY,
as Lender Agent for the Lenders
By /s/ ▇▇▇▇ ▇▇ ▇▇▇▇▇
----------------------------------
Title Assistant Vice President
--------------------------------
Notice Address:
Bankers Trust Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇ ▇▇▇▇▇
With a copy to:
Bankers Trust Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Annex 1
BANKERS TRUST COMPANY,
as Collateral Agent
By: /s/ ▇▇▇▇ ▇▇ ▇▇▇▇▇
------------------------------
Title: Assistant Vice President
---------------------------
Notice Address:
Bankers Trust Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇ ▇▇▇▇▇
With a copy to:
Bankers Trust Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Annex 2
EACH PLEDGOR, by its execution of this Agreement in the space provided
below, HEREBY ACKNOWLEDGES AND AGREES to the foregoing provisions of this
Agreement including, without limitation, Sections 3 and 4 hereof.
PLEDGOR
▇▇▇▇▇-ILLINOIS GROUP, INC.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title Assistant Treasurer
-------------------------------
Notice Address:
One ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: Treasurer
PLEDGOR
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ PACKAGING INC.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title Assistant Treasurer
-------------------------------
Notice Address:
One ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: Treasurer
Annex 3