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EXHIBIT 99.5
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COLLATERAL SHARING AGREEMENT
Dated as of February 22, 2001
among
LUCENT TECHNOLOGIES INC.,
THE GRANTORS REFERRED TO HEREIN
and
THE CHASE MANHATTAN BANK,
as Collateral Agent
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COLLATERAL SHARING AGREEMENT, dated as of February 22, 2001,
among LUCENT TECHNOLOGIES INC., a Delaware corporation (the "Borrower"), the
Grantors referred to in Section 6.11 hereof and THE CHASE MANHATTAN BANK, as
collateral agent (in such capacity, the "Collateral Agent").
W I T N E S S E T H :
WHEREAS, in order to induce the Lenders parties thereto to enter
into the Credit Agreements (such term and certain other capitalized terms used
herein being defined in Section 1.1), the Borrower and certain of its
Subsidiaries have entered into the Guarantee and Collateral Agreement;
WHEREAS, pursuant to the Guarantee and Collateral Agreement, the
Borrower has guaranteed certain External Sharing Debt Obligations of its
Subsidiaries, and certain Subsidiaries of the Borrower have guaranteed the
Borrower Obligations and certain External Sharing Debt Obligations of the
Borrower; and
WHEREAS, the Guaranteed Obligations are secured by Liens on the
Collateral described in the Security Documents;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements set forth herein and to induce the Administrative Agent and the
Lenders to enter into the Credit Agreements, to induce the Lenders to make their
respective extensions of credit to the Borrower thereunder and to induce the
holders of External Sharing Debt to maintain such Indebtedness, each Grantor
hereby agrees with the Collateral Agent, for the benefit of the Secured Parties,
as follows:
SECTION 1.
DEFINED TERMS
1.1 Definitions. (a) Unless otherwise defined herein, terms
defined in the Guarantee and Collateral Agreement and used herein shall have the
meanings given to them in the Guarantee and Collateral Agreement.
(b) The following terms shall have the respective meanings
set forth below:
"Agreement" shall mean this Collateral Sharing Agreement as the
same may from time to time be amended, supplemented or otherwise
modified.
"Collateral" shall mean all property of the Loan Parties, now
owned or hereafter acquired, upon which a Lien is purported to be
created by any Security Document.
"Collateral Account" shall have the meaning assigned in Section
3.1.
"Collateral Agent" shall mean The Chase Manhattan Bank, in its
capacity as collateral agent under the Security Documents and this
Agreement, and any successor collateral agent appointed hereunder.
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"Collateral Agent Fees" shall mean all fees, costs and expenses
of the Collateral Agent of the types described in Sections 4.3, 4.4, 4.5
and 4.6.
"Collateral Estate" shall have the meaning assigned in Section
2.1(c).
"Distribution Date" shall mean each date fixed by the Collateral
Agent in its sole discretion for a distribution to the Secured Parties
of funds held in the Collateral Account.
"Exchange Rate" shall mean, at any date of determination thereof
with respect to any currency, the spot rate of exchange for the
conversion of such currency into dollars determined by reference to such
rate publishing service as is customarily utilized by the Collateral
Agent for such purpose; provided that, to the extent that "Exchange
Rate" is used herein to refer to an actual exchange by the Collateral
Agent of one currency for another, "Exchange Rate" shall be deemed to
refer to the rate at which such exchange actually occurs so long as such
exchange is effected under customary market conditions. Any such
determination of the Exchange Rate shall be conclusive absent manifest
error.
"Mortgages" shall mean each of the mortgages and deeds of trust
made by any Loan Party in favor of, or for the benefit of, the
Collateral Agent for the benefit of the Secured Parties, substantially
in the form of Exhibit E to each of the Credit Agreements (with such
changes thereto as shall be advisable under the law of the jurisdiction
in which such mortgage or deed of trust is to be recorded).
"Opinion of Counsel" shall mean an opinion in writing signed by
legal counsel satisfactory to the Collateral Agent, who may be counsel
regularly retained by the Collateral Agent.
"Permitted Investments" shall mean:
(i) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States
of America (or by any agency thereof to the extent such obligations are
backed by the full faith and credit of the United States of America), in
each case maturing within one year from the date of acquisition thereof;
(ii) investments in commercial paper maturing within 270 days
from the date of acquisition thereof and having, at such date of
acquisition, the highest credit rating obtainable from S&P or from
▇▇▇▇▇'▇;
(iii) investments in certificates of deposit, banker's
acceptances and time deposits maturing within 180 days from the date of
acquisition thereof issued or guaranteed by or placed with, and money
market deposit accounts issued or offered by, any domestic office of any
commercial bank organized under the laws of the United States of America
or any State thereof which has a combined capital and surplus and
undivided profits of not less than $500,000,000;
(iv) fully collateralized repurchase agreements with a term of
not more than 30 days for securities described in clause (i) above and
entered into with a financial institution satisfying the criteria
described in clause (iii) above;
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(v) in the case of any Foreign Subsidiary, (A) marketable direct
obligations issued by, or unconditionally guaranteed by, the sovereign
nation in which such Foreign Subsidiary is organized and is conducting
business or issued by any agency of such sovereign nation and backed by
the full faith and credit of such sovereign nation, in each case
maturing within one year from the date of acquisition, so long as the
indebtedness of such sovereign nation is rated at least A by S&P or A2
by ▇▇▇▇▇'▇ or carries an equivalent rating from a comparable foreign
rating agency or (B) investments of the type and maturity described in
clauses (ii) through (iv) above of foreign obligors, which investments
or obligors have ratings described in such clauses or equivalent ratings
from comparable foreign rating agencies; and
(vi) investments made in compliance with the "Lucent
Technologies Domestic Investment Guidelines", dated December 5, 1996,
and the supplement thereto with respect to investments outside of the
United States of America, substantially as in effect on the date hereof.
"Proceeds" shall mean all "proceeds" as such term is defined in
Section 9-306(1) of the Uniform Commercial Code in effect in the State
of New York on the date hereof.
"Restricted Collateral Obligations" shall mean, at any time, the
Restricted Secured Indebtedness at such time and the External Sharing
Debt that is not Borrowed Debt at such time.
"Security Documents" shall mean the collective reference to the
Guarantee and Collateral Agreement, the Mortgages and all other security
documents hereafter delivered to the Collateral Agent or the
Administrative Agent granting a Lien on any property of any Person to
secure the obligations and liabilities of any Loan Party pursuant to the
Credit Agreements, the External Sharing Debt or any Guarantee in respect
thereof. For the avoidance of doubt, the foregoing shall exclude any
security document entered into in connection with any External Sharing
Debt and that secures only the External Sharing Debt Obligations in
respect of such External Sharing Debt.
"Sharing Acknowledgement" shall have the meaning assigned in
Section 4.1.
"Unrestricted Collateral" shall mean all Collateral other than
the Restricted Collateral.
(c) The words "hereof", "herein" and "hereunder" and words
of similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section
references are to this Agreement unless otherwise specified.
SECTION 2.
AUTHORITY OF COLLATERAL AGENT
2.1 General Authority of the Collateral Agent over the
Collateral. (a) Each Grantor hereby irrevocably constitutes and appoints the
Collateral Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full power and
authority in its or his own name, from time to time in the Collateral Agent's
discretion to take any and all appropriate action and to execute any and all
documents and instruments which may
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be necessary or desirable to carry out the terms of this Agreement and the
Security Documents and accomplish the purposes hereof and thereof and, without
limiting the generality of the foregoing, each Grantor hereby acknowledges that
the Collateral Agent shall have all powers and remedies set forth in the
Security Documents.
(b) By acceptance of the benefits of this Agreement and the
Security Documents, each Secured Party shall be deemed irrevocably (i) to
consent to the appointment of the Collateral Agent as its agent hereunder and
under the Security Documents, (ii) to confirm that the Collateral Agent shall
have the authority to act as the exclusive agent of such Secured Party for
enforcement of any provisions of this Agreement and the Security Documents
against any Grantor or the exercise of remedies hereunder or thereunder, (iii)
to agree that such Secured Party shall not take any action to enforce any
provisions of this Agreement or any Security Document against any Grantor or to
exercise any remedy hereunder or thereunder and (iv) to agree to be bound by the
terms of this Agreement and the Security Documents.
(c) The Collateral Agent hereby agrees that it holds and
will hold all of its right, title and interest in, to and under the Security
Documents and the Collateral granted to the Collateral Agent thereunder whether
now existing or hereafter arising (all such right, title and interest being
hereinafter referred to as the "Collateral Estate") under and subject to the
conditions set forth in this Agreement; and the Collateral Agent further agrees
that it will hold such Collateral Estate for the benefit of the Secured Parties,
for the enforcement of the payment of all Obligations and as security for the
performance of and compliance with the covenants and conditions of this
Agreement and each of the Security Documents, subject to the limits set forth in
the Security Documents.
2.2 Right to Initiate Judicial Proceedings. The Collateral
Agent, subject to the provisions of Section 5, (a) shall have the right and
power to institute and maintain such suits and proceedings as it may deem
appropriate to protect and enforce the rights vested in it by this Agreement and
each Security Document and (b) may, either after entry, or without entry,
proceed by suit or suits at law or in equity to enforce such rights and to
foreclose upon the Collateral and to sell all or, from time to time, any of the
Collateral under the judgment or decree of a court of competent jurisdiction.
2.3 Right to Appoint a Receiver. Upon the filing of a ▇▇▇▇
in equity or other commencement of judicial proceedings to enforce the rights of
the Collateral Agent under this Agreement or any Security Document, the
Collateral Agent shall, to the extent permitted by law, with notice to the
Borrower but without notice to any party claiming through the Grantors, without
regard to the solvency or insolvency at the time of any Person then liable for
the payment of any of the Obligations, without regard to the then value of the
Collateral Estate, and without requiring any bond from any complainant in such
proceedings, be entitled as a matter of right to the appointment of a receiver
or receivers of the Collateral Estate, or any part thereof, and of the rents,
issues, tolls, profits, royalties, revenues and other income thereof, pending
such proceedings, with such powers as the court making such appointment shall
confer, and to the entry of an order directing that the rents, issues, tolls,
profits, royalties, revenues and other income of the property constituting the
whole or any part of the Collateral Estate be segregated, sequestered and
impounded for the benefit of the Collateral Agent and the Secured Parties, and
each Grantor irrevocably consents to the appointments of such receiver or
receivers and to the entry of such order; provided that, notwithstanding the
appointment of any receiver, the
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Collateral Agent shall be entitled to retain possession and control of all cash
and Permitted Investments held by or deposited with it pursuant to this
Agreement or any Security Document.
2.4 Exercise of Powers. All of the powers, remedies and
rights of the Collateral Agent as set forth in this Agreement may be exercised
by the Collateral Agent in respect of any Security Document as though set forth
in full therein and all of the powers, remedies and rights of the Collateral
Agent as set forth in any Security Document may be exercised from time to time
as herein and therein provided.
2.5 Remedies Not Exclusive. (a) No remedy conferred upon or
reserved to the Collateral Agent herein or in the Security Documents is intended
to be exclusive of any other remedy or remedies, but every such remedy shall be
cumulative and shall be in addition to every other remedy conferred herein or in
any Security Document or now or hereafter existing at law or in equity or by
statute.
(b) No delay or omission by the Collateral Agent to exercise
any right, remedy or power hereunder or under any Security Document shall impair
any such right, remedy or power or shall be construed to be a waiver thereof,
and every right, power and remedy given by this Agreement or any Security
Document to the Collateral Agent may be exercised from time to time and as often
as may be deemed expedient by the Collateral Agent.
(c) If the Collateral Agent shall have proceeded to enforce
any right, remedy or power under this Agreement or any Security Document and the
proceeding for the enforcement thereof shall have been discontinued or abandoned
for any reason or shall have been determined adversely to the Collateral Agent,
then the Grantors, the Collateral Agent and the other Secured Parties shall,
subject to any determination in such proceeding, severally and respectively be
restored to their former positions and rights hereunder or thereunder with
respect to the Collateral Estate and in all other respects, and thereafter all
rights, remedies and powers of the Collateral Agent shall continue as though no
such proceeding had been taken.
(d) All rights of action and of asserting claims upon or
under this Agreement and the Security Documents may be enforced by the
Collateral Agent without the possession of any instrument evidencing any
Obligation or the production thereof at any trial or other proceeding relative
thereto, and any suit or proceeding instituted by the Collateral Agent shall be,
subject to Sections 5.4(c) and 5.9(b)(ii), brought in its name as Collateral
Agent and any recovery of judgment shall be held as part of the Collateral
Estate.
2.6 Waiver and Estoppel. (a) Each Grantor agrees, to the
extent it may lawfully do so, that it will not at any time in any manner
whatsoever claim, or take the benefit or advantage of, any appraisement,
valuation, stay, extension, moratorium, turnover or redemption law, or any law
permitting it to direct the order in which the Collateral shall be sold, now or
at any time hereafter in force, which may delay, prevent or otherwise affect the
performance or enforcement of this Agreement or any Security Document and hereby
waives all benefit or advantage of all such laws and covenants that it will not
hinder, delay or impede the execution of any power granted to the Collateral
Agent in this Agreement or any Security Document but will suffer and permit the
execution of every such power as though no such law were in force; provided that
nothing contained in this Section 2.6(a) shall be construed as a waiver of any
rights of the Grantors under any applicable federal bankruptcy law or state
insolvency law.
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(b) Each Grantor, to the extent it may lawfully do so, on
behalf of itself and all who may claim through or under it, including without
limitation any and all subsequent creditors, vendees, assignees and lienors,
waives and releases all rights to demand or to have any marshalling of the
Collateral upon any sale, whether made under any power of sale granted herein or
in any Security Document or pursuant to judicial proceedings or upon any
foreclosure or any enforcement of this Agreement or any Security Document and
consents and agrees that all the Collateral may at any such sale be offered and
sold as an entirety.
(c) Each Grantor waives, to the extent permitted by
applicable law, presentment, demand, protest and any notice of any kind (except
notices explicitly required hereunder or under any Security Document) in
connection with this Agreement and the Security Documents and any action taken
by the Collateral Agent with respect to the Collateral.
2.7 Limitation on Collateral Agent's Duty in Respect of
Collateral. Beyond its duties as to the custody thereof expressly provided
herein or in any Security Document and to account to the Secured Parties and the
Grantors for moneys and other property received by it hereunder or under any
Security Document, the Collateral Agent shall not have any duty to the Grantors
or to the Secured Parties as to any Collateral in its possession or control or
in the possession or control of any of its agents or nominees, or any income
thereon or as to the preservation of rights against prior parties or any other
rights pertaining thereto.
2.8 Limitation by Law. All rights, remedies and powers
provided in this Agreement or any Security Document may be exercised only to the
extent that the exercise thereof does not violate any applicable provision of
law, and all the provisions hereof are intended to be subject to all applicable
mandatory provisions of law which may be controlling and to be limited to the
extent necessary so that they will not render this Agreement invalid,
unenforceable in whole or in part or not entitled to be recorded, registered or
filed under the provisions of any applicable law.
2.9 Rights of Secured Parties in Respect of Obligations.
Notwithstanding any other provision of this Agreement or any Security Document,
the right of each Secured Party to receive payment of the Obligations held by
such Secured Party when due (whether at the stated maturity thereof, by
acceleration or otherwise), as expressed in the instruments evidencing or
agreements governing such Obligations or to institute suit for the enforcement
of such payment on or after such due date, shall not be impaired or affected
without the consent of such Secured Party given in the manner prescribed by the
instruments evidencing or agreements governing such Obligations.
SECTION 3.
COLLATERAL ACCOUNT; DISTRIBUTIONS
3.1 The Collateral Account. At such time as the Collateral
Agent deems appropriate, there shall be established and, at all times thereafter
until this Agreement shall have terminated, there shall be maintained with the
Collateral Agent an account which shall be entitled the "Lucent Collateral
Account" (the "Collateral Account"). All moneys which are received by the
Collateral Agent or any agent or nominee of the Collateral Agent in respect of
the Collateral, whether in connection with the exercise of the remedies provided
in this Agreement or any Security Document, shall be deposited in the Collateral
Account and held by the Collateral Agent as part of the Collateral Estate and
applied in accordance with the terms of
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this Agreement. The Collateral Agent shall maintain such sub-accounts and
records with respect to the Collateral Account as will permit the segregation
and allocation of proceeds of Collateral in accordance with Section 3.4. In the
event that, on any day, an amount is received by the Collateral Agent or any
agent or nominee of the Collateral Agent in respect of Collateral and such
amount is denominated in any currency other than dollars, the Collateral Agent
shall convert such amount into an amount of dollars based upon the relevant
Exchange Rate in effect for such day.
3.2 Control of Collateral Account. All right, title and
interest in and to the Collateral Account shall vest in the Collateral Agent,
and funds on deposit in the Collateral Account shall constitute part of the
Collateral Estate. The Collateral Account shall be subject to the exclusive
dominion and control of the Collateral Agent.
3.3 Investment of Funds Deposited in Collateral Account. The
Collateral Agent may, but is under no obligation to, invest and reinvest moneys
on deposit in the Collateral Account at any time in Permitted Investments. All
such investments and the interest and income received thereon and the net
proceeds realized on the sale or redemption thereof shall be held in the
Collateral Account as part of the Collateral Estate. The Collateral Agent shall
not be responsible for any diminution in funds resulting from such investments
or any liquidation prior to maturity.
3.4 Application of Moneys. (a) The Collateral Agent shall
have the right at any time to apply moneys held by it in the Collateral Account
to the payment of due and unpaid Collateral Agent Fees.
(b) All remaining moneys held by the Collateral Agent in the
Collateral Account received by the Collateral Agent with respect to the
Restricted Collateral (other than (i) the Capital Stock of Agere and (ii) in the
event that Agere or any of its Subsidiaries is required to enter into the
Guarantee and Collateral Agreement pursuant to Section 5.11 of any of the Credit
Agreements, any Restricted Collateral of Agere and its Subsidiaries) shall, to
the extent available for distribution (it being understood that the Collateral
Agent may liquidate investments prior to maturity in order to make a
distribution pursuant to this Section 3.4), be distributed (subject to the
provisions of Section 3.5) by the Collateral Agent on each Distribution Date in
the following order of priority (with such distributions being made by the
Collateral Agent as provided in Section 3.4(g), and the applicable
Administrative Agent shall be responsible for insuring that amounts distributed
to it are distributed to its Lenders in the order of priority set forth below):
First: to the Collateral Agent for any unpaid Collateral Agent
Fees and then to any Secured Party which has theretofore advanced or
paid any Collateral Agent Fees constituting administrative expenses
allowable under Section 503(b) of the Bankruptcy Code, an amount equal
to the amount thereof so advanced or paid by such Secured Party and for
which such Secured Party has not been reimbursed prior to such
Distribution Date, and, if such moneys shall be insufficient to pay such
amounts in full, then ratably (without priority of any one over any
other) to such Secured Parties in proportion to the amounts of such
Collateral Agent Fees advanced by the respective Secured Parties and
remaining unpaid on such Distribution Date;
Second: to any Secured Party which has theretofore advanced or
paid any Collateral Agent Fees other than such administrative expenses,
an amount equal to the
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amount thereof so advanced or paid by such Secured Party and for which
such Secured Party has not been reimbursed prior to such Distribution
Date, and, if such moneys shall be insufficient to pay such amounts in
full, then ratably (without priority of any one over any other) to such
Secured Parties in proportion to the amounts of such Collateral Agent
Fees advanced by the respective Secured Parties and remaining unpaid on
such Distribution Date;
Third: to the Secured Parties holding Restricted Collateral
Obligations, amounts equal to all Restricted Collateral Obligations then
owing to them (other than amounts described in clause Fourth below),
whether or not then due and payable, and, if such moneys shall be
insufficient to pay such amounts in full, then ratably (without priority
of any one over any other) to such Secured Parties in proportion to the
unpaid amounts thereof on such Distribution Date;
Fourth: to the Secured Parties holding Restricted Collateral
Obligations, amounts equal to all costs and expenses of such Secured
Parties and their representatives which constitute Restricted Collateral
Obligations and are due and payable under the relevant instruments
evidencing or agreements governing the Restricted Collateral Obligations
as of such Distribution Date, and, if such moneys shall be insufficient
to pay such amounts in full, then ratably to such Secured Parties in
proportion to the unpaid amounts thereof on such Distribution Date; and
Fifth: any surplus then remaining shall be paid to the Grantors
or their successors or assigns or to whomsoever may be lawfully entitled
to receive the same or as a court of competent jurisdiction may direct.
(c) All remaining moneys held by the Collateral Agent in the
Collateral Account received by the Collateral Agent with respect to the Capital
Stock of Agere (and, in the event that Agere or any of its Subsidiaries is
required to enter into the Guarantee and Collateral Agreement pursuant to
Section 5.11 of any of the Credit Agreements, all remaining moneys held by the
Collateral Agent in the Collateral Account received by the Collateral Agent with
respect to any Restricted Collateral of Agere and its Subsidiaries) shall, to
the extent available for distribution (it being understood that the Collateral
Agent may liquidate investments prior to maturity in order to make a
distribution pursuant to this Section 3.4), be distributed (subject to the
provisions of Section 3.5) by the Collateral Agent on each Distribution Date in
the following order of priority (with such distributions being made by the
Collateral Agent as provided in Section 3.4(g), and the applicable
Administrative Agent shall be responsible for insuring that amounts distributed
to it are distributed to its Lenders in the order of priority set forth below):
First: to the Collateral Agent for any unpaid Collateral Agent
Fees and then to any Secured Party which has theretofore advanced or
paid any Collateral Agent Fees constituting administrative expenses
allowable under Section 503(b) of the Bankruptcy Code, an amount equal
to the amount thereof so advanced or paid by such Secured Party and for
which such Secured Party has not been reimbursed prior to such
Distribution Date, and, if such moneys shall be insufficient to pay such
amounts in full, then ratably (without priority of any one over any
other) to such Secured Parties in proportion to the amounts of such
Collateral Agent Fees advanced by the respective Secured Parties and
remaining unpaid on such Distribution Date;
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Second: to any Secured Party which has theretofore advanced or
paid any Collateral Agent Fees other than such administrative expenses,
an amount equal to the amount thereof so advanced or paid by such
Secured Party and for which such Secured Party has not been reimbursed
prior to such Distribution Date, and, if such moneys shall be
insufficient to pay such amounts in full, then ratably (without priority
of any one over any other) to such Secured Parties in proportion to the
amounts of such Collateral Agent Fees advanced by the respective Secured
Parties and remaining unpaid on such Distribution Date;
Third: to the Administrative Agent and the Lenders under the
Lucent Assumable Credit Agreement, amounts equal to the unpaid
principal, interest, premium, fees and other charges in respect of the
Restricted Collateral Obligations under the Lucent Assumable Credit
Agreement then outstanding, whether or not then due and payable, and, if
such moneys shall be insufficient to pay such amounts in full, then
ratably (without priority of any one over any other) to the
Administrative Agent and such Lenders in proportion to the unpaid
amounts thereof on such Distribution Date;
Fourth: to the Secured Parties holding Restricted Collateral
Obligations under the 364-Day Lucent Credit Agreement, the Five-Year
Lucent Credit Agreement and the documents and instruments evidencing or
agreements governing External Sharing Debt, amounts equal to all
Restricted Collateral Obligations then owing to them (other than amounts
described in clause Fifth below), whether or not then due and payable,
and, if such moneys shall be insufficient to pay such amounts in full,
then ratably (without priority of any one over any other) to such
Secured Parties in proportion to the unpaid amounts thereof on such
Distribution Date;
Fifth: to the Secured Parties holding Restricted Collateral
Obligations, amounts equal to all costs and expenses of such Secured
Parties and their representatives which constitute Restricted Collateral
Obligations and are due and payable under the relevant instruments
evidencing or agreements governing such Obligations as of such
Distribution Date, and, if such moneys shall be insufficient to pay such
amounts in full, then ratably to such Secured Parties in proportion to
the unpaid amounts thereof on such Distribution Date; and
Sixth: any surplus then remaining shall be paid to the Grantors
or their successors or assigns or to whomsoever may be lawfully entitled
to receive the same or as a court of competent jurisdiction may direct.
(d) In the event that Agere or any of its Subsidiaries is
required to enter into the Guarantee and Collateral Agreement pursuant to
Section 5.11 of any of the Credit Agreements, all remaining moneys held by the
Collateral Agent in the Collateral Account received by the Collateral Agent with
respect to any Unrestricted Collateral of Agere and its Subsidiaries shall, to
the extent available for distribution (it being understood that the Collateral
Agent may liquidate investments prior to maturity in order to make a
distribution pursuant to this Section 3.4), be distributed (subject to the
provisions of Section 3.5) by the Collateral Agent on each Distribution Date in
the following order of priority (with such distributions being made by the
Collateral Agent as provided in Section 3.4(g), and the applicable
Administrative Agent shall be responsible for insuring that amounts distributed
to it are distributed to its Lenders in the order of priority set forth below):
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First: to the Collateral Agent for any unpaid Collateral Agent
Fees and then to any Secured Party which has theretofore advanced or
paid any Collateral Agent Fees constituting administrative expenses
allowable under Section 503(b) of the Bankruptcy Code, an amount equal
to the amount thereof so advanced or paid by such Secured Party and for
which such Secured Party has not been reimbursed prior to such
Distribution Date, and, if such moneys shall be insufficient to pay such
amounts in full, then ratably (without priority of any one over any
other) to such Secured Parties in proportion to the amounts of such
Collateral Agent Fees advanced by the respective Secured Parties and
remaining unpaid on such Distribution Date;
Second: to any Secured Party which has theretofore advanced or
paid any Collateral Agent Fees other than such administrative expenses,
an amount equal to the amount thereof so advanced or paid by such
Secured Party and for which such Secured Party has not been reimbursed
prior to such Distribution Date, and, if such moneys shall be
insufficient to pay such amounts in full, then ratably (without priority
of any one over any other) to such Secured Parties in proportion to the
amounts of such Collateral Agent Fees advanced by the respective Secured
Parties and remaining unpaid on such Distribution Date;
Third: to the Administrative Agent and the Lenders under the
Lucent Assumable Credit Agreement, amounts equal to the unpaid
principal, interest, premium, fees and other charges in respect of the
Obligations under the Lucent Assumable Credit Agreement then
outstanding, whether or not then due and payable, and, if such moneys
shall be insufficient to pay such amounts in full, then ratably (without
priority of any one over any other) to the Administrative Agent and such
Lenders in proportion to the unpaid amounts thereof on such Distribution
Date;
Fourth: to the Secured Parties holding Obligations under the
364-Day Lucent Credit Agreement, the Five-Year Lucent Credit Agreement
and the documents and instruments evidencing or agreements governing
External Sharing Debt, amounts equal to all Obligations then owing to
them (other than amounts described in clause Fifth below), whether or
not then due and payable, and, if such moneys shall be insufficient to
pay such amounts in full, then ratably (without priority of any one over
any other) to such Secured Parties in proportion to the unpaid amounts
thereof on such Distribution Date;
Fifth: to the Secured Parties, amounts equal to all costs and
expenses of such Secured Parties and their representatives which
constitute Obligations and are due and payable under the relevant
instruments evidencing or agreements governing such Obligations as of
such Distribution Date, and, if such moneys shall be insufficient to pay
such amounts in full, then ratably to the Secured Parties in proportion
to the unpaid amounts thereof on such Distribution Date; and
Sixth: any surplus then remaining shall be paid to the Grantors
or their successors or assigns or to whomsoever may be lawfully entitled
to receive the same or as a court of competent jurisdiction may direct.
(e) All remaining moneys held by the Collateral Agent in the
Collateral Account received by the Collateral Agent with respect to the
Unrestricted Collateral (other than any Unrestricted Collateral of Agere and its
Subsidiaries) shall, to the extent available for
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distribution (it being understood that the Collateral Agent may liquidate
investments prior to maturity in order to make a distribution pursuant to this
Section 3.4), be distributed (subject to the provisions of Section 3.5) by the
Collateral Agent on each Distribution Date in the following order of priority
(with such distributions being made by the Collateral Agent as provided in
Section 3.4(g), and the applicable Administrative Agent shall be responsible for
insuring that amounts distributed to it are distributed to its Lenders in the
order of priority set forth below):
First: to the Collateral Agent for any unpaid Collateral Agent
Fees and then to any Secured Party which has theretofore advanced or
paid any Collateral Agent Fees constituting administrative expenses
allowable under Section 503(b) of the Bankruptcy Code, an amount equal
to the amount thereof so advanced or paid by such Secured Party and for
which such Secured Party has not been reimbursed prior to such
Distribution Date, and, if such moneys shall be insufficient to pay such
amounts in full, then ratably (without priority of any one over any
other) to such Secured Parties in proportion to the amounts of such
Collateral Agent Fees advanced by the respective Secured Parties and
remaining unpaid on such Distribution Date;
Second: to any Secured Party which has theretofore advanced or
paid any Collateral Agent Fees other than such administrative expenses,
an amount equal to the amount thereof so advanced or paid by such
Secured Party and for which such Secured Party has not been reimbursed
prior to such Distribution Date, and, if such moneys shall be
insufficient to pay such amounts in full, then ratably (without priority
of any one over any other) to such Secured Parties in proportion to the
amounts of such Collateral Agent Fees advanced by the respective Secured
Parties and remaining unpaid on such Distribution Date;
Third: to the Secured Parties, amounts equal to all Obligations
then owing to them (other than amounts described in clause Fourth
below), whether or not then due and payable, and, if such moneys shall
be insufficient to pay such amounts in full, then ratably (without
priority of any one over any other) to the Secured Parties in proportion
to the unpaid amounts thereof on such Distribution Date;
Fourth: to the Secured Parties, amounts equal to all costs and
expenses of the Secured Parties and their representatives which
constitute Obligations and are due and payable under the relevant
instruments evidencing or agreements governing such Obligations as of
such Distribution Date, and, if such moneys shall be insufficient to pay
such amounts in full, then ratably to the Secured Parties in proportion
to the unpaid amounts thereof on such Distribution Date; and
Fifth: any surplus then remaining shall be paid to the Grantors
or their successors or assigns or to whomsoever ----- may be lawfully
entitled to receive the same or as a court of competent jurisdiction may
direct.
(f) The term "unpaid" as used in clause Third of each of
Sections 3.4(b), 3.4(c), 3.4(d) and 3.4(e) and clause Fourth of each of Sections
3.4(c) and 3.4(d) refers:
(i) in the absence of a bankruptcy proceeding with
respect to the relevant Grantor(s), to all amounts of Borrower
Obligations or External Sharing Debt Obligations, as the case may be,
outstanding as of a Distribution Date, and
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(ii) during the pendency of a bankruptcy proceeding
with respect to the relevant Grantor(s), to all amounts allowed by the
bankruptcy court in respect of Borrower Obligations or External Sharing
Debt Obligations, as the case may be, as a basis for distribution
(including estimated amounts, if any, allowed in respect of contingent
claims),
to the extent that prior distributions have not been made in respect thereof.
(g) The Collateral Agent shall make all payments and
distributions under this Section 3.4: (i) on account of Borrower Obligations to
the applicable Administrative Agent, pursuant to directions of such
Administrative Agent, for re-distribution in accordance with the provisions of
the applicable Credit Agreements; and (ii) on account of External Sharing Debt
Obligations to the relevant holder of such External Sharing Debt (as set forth
in the Sharing Acknowledgement with respect to such External Sharing Debt or, if
more recently provided, the list delivered by the Borrower to the Collateral
Agent pursuant to Section 4.2), pursuant to directions of such holder.
3.5 Collateral Agent's Calculations. In making the
determinations and allocations required by Section 3.4, the Collateral Agent may
conclusively rely upon information supplied by the applicable holders of
External Sharing Debt as to the amounts of unpaid principal and interest and
other amounts outstanding with respect to the External Sharing Debt Obligations
held by such holders and information supplied by the Administrative Agent as to
the amounts of unpaid principal and interest and other amounts outstanding with
respect to the Borrower Obligations, and the Collateral Agent shall have no
liability to any of the Secured Parties for actions taken in reliance on such
information, provided that nothing in this sentence shall prevent any Grantor
from contesting any amounts claimed by any Secured Party in any information so
supplied. In addition, for purposes of making the allocations required by
Section 3.4 with respect to any amount that is denominated in any currency other
than dollars, the Collateral Agent shall, on the applicable Distribution Date,
convert such amount into an amount of dollars based upon the relevant Exchange
Rate as of a recent date specified by the Collateral Agent in its reasonable
discretion. All distributions made by the Collateral Agent pursuant to Section
3.4 shall be (subject to any decree of any court of competent jurisdiction)
final (absent manifest error), and the Collateral Agent shall have no duty to
inquire as to the application by the Administrative Agent or any holder of
External Sharing Debt of any amounts distributed to them.
3.6 Pro Rata Sharing. If, through the operation of any
bankruptcy, reorganization, insolvency or other laws or otherwise, the
Collateral Agent's security interest hereunder and under the Security Documents
is enforced with respect to some, but not all, of the Obligations then
outstanding, the Collateral Agent shall nonetheless apply the proceeds of the
Collateral for the benefit of the holders of all Obligations in the proportions
and subject to the priorities and allocations specified herein.
SECTION 4.
AGREEMENTS WITH COLLATERAL AGENT
4.1 Delivery of Sharing Acknowledgements. On the date
hereof, the Borrower shall deliver to the Collateral Agent an acknowledgement
(each, a "Sharing Acknowledgement") with respect to each item of External
Sharing Debt as of the date hereof,
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which acknowledgement shall set forth a description of such External Sharing
Debt, including the maximum amount thereof and the relevant currency and the
contact information for the holder thereof, and shall be executed by the holder
of such External Sharing Debt.
4.2 Information as to Administrative Agent and Other Secured
Parties. The Borrower shall deliver to the Collateral Agent, on the date hereof,
on each anniversary of the date hereof, and from time to time upon request of
the Collateral Agent, a list setting forth as of a date not more than 30 days
prior to the date of such delivery, the aggregate unpaid principal amount of
Borrower Obligations outstanding (as notified to the Borrower by the applicable
Administrative Agent) and the name and address of the applicable Administrative
Agent, provided that the Borrower shall not be required to deliver such
information to the Collateral Agent if, at the time such information is required
to be delivered, The Chase Manhattan Bank is the Collateral Agent hereunder and
is the Administrative Agent under each of the Credit Agreements. The Borrower
shall deliver to the Collateral Agent, on the date hereof and not more than 30
days after the end of each fiscal quarter of the Borrower, a list setting forth
each item of External Sharing Debt outstanding on the last Business Day of the
most recently ended fiscal quarter of the Borrower, including the aggregate
unpaid principal amount of External Sharing Debt Obligations outstanding and,
with respect to each item of External Sharing Debt, the name and address of the
holder thereof. In addition, the Borrower will promptly notify the Collateral
Agent of each change in the identity of any Administrative Agent or any holder
of External Sharing Debt.
4.3 Compensation and Expenses. The Borrower agrees to pay to
the Collateral Agent, from time to time upon demand, (a) the fees separately
agreed upon for its services hereunder and under the Security Documents and for
administering the Collateral Estate and (b) all of the costs and expenses of the
Collateral Agent (including, without limitation, the reasonable fees and
disbursements of its counsel, advisors and agents) (i) arising in connection
with the preparation, execution, delivery, modification, and termination of this
Agreement and each Security Document or the enforcement of any of the provisions
hereof or thereof, (ii) incurred or required to be advanced in connection with
the administration of the Collateral Estate, the sale or other disposition of
Collateral pursuant to any Security Document and the preservation, protection or
defense of the Collateral Agent's rights under this Agreement and the Security
Documents and in and to the Collateral and the Collateral Estate or (iii)
incurred by the Collateral Agent in connection with the removal of the
Collateral Agent pursuant to Section 5.6(a). Such fees, costs and expenses are
intended to constitute expenses of administration under any bankruptcy law
relating to creditors rights generally. The obligations of the Borrower under
this Section 4.3 shall survive the termination of the other provisions of this
Agreement and the resignation or removal of the Collateral Agent hereunder with
respect to such fees, costs and expenses incurred prior to such termination,
resignation or removal.
4.4 Stamp and Other Similar Taxes. The Borrower agrees to
indemnify and hold harmless the Collateral Agent, the Administrative Agent and
each other Secured Party from any present or future claim for liability for any
stamp or any other similar tax, and any penalties or interest with respect
thereto, which may be assessed, levied or collected by any jurisdiction in
connection with this Agreement, any Security Document, the Collateral Estate or
any Collateral. The obligations of the Borrower under this Section 4.4 shall
survive the termination of the other provisions of this Agreement and the
resignation or removal of the Collateral Agent hereunder.
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4.5 Filing Fees, Excise Taxes, Etc. The Borrower agrees to
pay or to reimburse the Collateral Agent for any and all payments made by the
Collateral Agent in respect of all search, filing, recording and registration
fees, taxes, excise taxes and other similar imposts which may be payable or
determined to be payable in respect of the execution and delivery of this
Agreement and each Security Document. The obligations of the Borrower under this
Section 4.5 shall survive the termination of the other provisions of this
Agreement and the resignation or removal of the Collateral Agent hereunder.
4.6 Indemnification. The Borrower agrees to pay, indemnify,
and hold the Collateral Agent and the Administrative Agent (and their respective
directors, officers, agents and employees) harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including, without limitation, the reasonable fees and expenses
of counsel, advisors and agents) or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of this Agreement and the Security Documents, unless arising from
the gross negligence or willful misconduct of the indemnified party, including
for taxes in any jurisdiction in which the Collateral Agent is subject to tax by
reason of actions hereunder or under the Security Documents, unless such taxes
are imposed on or measured by compensation paid to the Collateral Agent under
Section 4.3. In any suit, proceeding or action brought by the Collateral Agent
under or with respect to any contract, agreement, interest or obligation
constituting part of the Collateral for any sum owing thereunder, or to enforce
any provisions thereof, the Borrower will save, indemnify and keep the
Collateral Agent, the Administrative Agent and the other Secured Parties
harmless from and against all expense, loss or damage suffered by reason of any
defense, setoff, counterclaim, recoupment or reduction of liability whatsoever
of the obligor thereunder, arising out of a breach by any Grantor of any
obligation thereunder or arising out of any other agreement, indebtedness or
liability at any time owing to or in favor of such obligor or its successors
from any Grantor, and all such obligations of the Borrower shall be and remain
enforceable against and only against the Borrower and shall not be enforceable
against the Collateral Agent, the Administrative Agent or any other Secured
Party. The agreements in this Section 4.6 shall survive the termination of the
other provisions of this Agreement and the resignation or removal of the
Collateral Agent hereunder.
4.7 Collateral Agent's Lien. Notwithstanding anything to the
contrary in this Agreement, as security for the payment of Collateral Agent Fees
(a) the Collateral Agent is hereby granted a lien upon all Collateral and (b)
the Collateral Agent shall have the right to use and apply any of the funds held
by the Collateral Agent in the Collateral Account to cover such Collateral Agent
Fees.
4.8 Further Assurances. At any time and from time to time,
upon the written request of the Administrative Agent or the Collateral Agent,
and at the expense of the Borrower, each Grantor will promptly execute and
deliver any and all such further instruments and documents and take such further
action as is necessary or reasonably requested further to perfect, or to protect
the perfection of, the liens and security interests granted under the Security
Documents (to the extent that perfection is required thereunder), including,
without limitation, the filing of any financing or continuation statements under
the Uniform Commercial Code in effect in any jurisdiction. In addition to the
foregoing, at any time and from time to time, upon the written request of the
Collateral Agent, and at the expense of the Borrower, each Grantor will promptly
execute and deliver any and all such further instruments and documents and take
such further action as the Collateral Agent determines is necessary or
reasonably requested to obtain
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the full benefits of this Agreement and the Security Documents and of the rights
and powers herein and therein granted, including, without limitation, the filing
of any financing or continuation statements under the Uniform Commercial Code in
effect in any jurisdiction with respect to the liens and security interests
granted by the Security Documents. Each Grantor also hereby authorizes the
Collateral Agent to sign and file any such financing or continuation statements
without the signature of such Grantor to the extent permitted by applicable law.
Notwithstanding the foregoing, in no event shall the Collateral Agent have any
obligation to monitor the perfection or continuation of perfection or the
sufficiency or validity of any security interest in or related to the
Collateral.
SECTION 5.
THE COLLATERAL AGENT
5.1 Exculpatory Provisions. (a) The Collateral Agent shall
not be responsible in any manner whatsoever for the correctness of any recitals,
statements, representations or warranties herein, all of which are made solely
by the Grantors. The Collateral Agent makes no representations as to the value
or condition of the Collateral Estate or any part thereof, or as to the title of
the Grantors thereto or as to the security afforded by this Agreement or any
Security Document, or as to the validity, execution (except its execution),
enforceability, legality or sufficiency of this Agreement, the Security
Documents or the Obligations, and the Collateral Agent shall incur no liability
or responsibility in respect of any such matters.
(b) The Collateral Agent shall not be required to ascertain
or inquire as to the performance by the Grantors of any of the covenants or
agreements contained herein, in any Security Document, in any other Loan
Document or in any instrument evidencing or agreement governing External Sharing
Debt. Whenever it is necessary, or in the opinion of the Collateral Agent
advisable, for the Collateral Agent to ascertain the amount of Obligations then
held by Secured Parties, the Collateral Agent may rely on a certificate of the
relevant holder of External Sharing Debt, in the case of External Sharing Debt
Obligations, or a certificate of the applicable Administrative Agent, in the
case of Borrower Obligations, and, if such holder or such Administrative Agent
shall not give such information to the Collateral Agent, such Person shall not
be entitled to receive distributions hereunder (in which case distributions to
those Persons who have supplied such information to the Collateral Agent shall
be calculated by the Collateral Agent using, for those Persons who have not
supplied such information, the list then most recently delivered by the Borrower
pursuant to Section 4.2), and the amount so calculated to be distributed to the
Person who fails to give such information shall be held in trust for such Person
until such Person does supply such information to the Collateral Agent,
whereupon on the next Distribution Date the amount distributable to such Person
shall be recalculated using such information and distributed to it. Nothing in
the preceding sentence shall prevent any Grantor from contesting any amounts
claimed by any Secured Party in any certificate so supplied.
(c) The Collateral Agent shall be under no obligation or
duty to take any action under this Agreement or any Security Document if taking
such action (i) would subject the Collateral Agent to a tax in any jurisdiction
where it is not then subject to a tax or (ii) would require the Collateral Agent
to qualify to do business in any jurisdiction where it is not then so qualified,
unless the Collateral Agent receives security or indemnity satisfactory to it
against such tax (or equivalent liability), or any liability resulting from such
qualification, in each case as results from the taking of such action under this
Agreement or any Security Document.
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(d) The Collateral Agent shall have the same rights with
respect to any Obligation held by it as any other Secured Party and may exercise
such rights as though it were not the Collateral Agent hereunder, and may accept
deposits from, lend money to, and generally engage in any kind of banking or
trust business with, any of the Grantors as if it were not the Collateral Agent.
(e) The Collateral Agent shall not be liable for any action
taken or omitted to be taken in accordance with this Agreement or the Security
Documents except for its own gross negligence or willful misconduct.
5.2 Delegation of Duties. The Collateral Agent may execute
any of the powers herein and perform any duty hereunder either directly or by or
through agents or attorneys-in-fact. The Collateral Agent shall be entitled to
advice of counsel concerning all matters pertaining to such powers and duties.
The Collateral Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it without gross negligence or
willful misconduct.
5.3 Reliance by Collateral Agent. (a) Whenever in the
administration of this Agreement or the Security Documents the Collateral Agent
shall deem it necessary or desirable that a factual matter be proved or
established in connection with the Collateral Agent taking, suffering or
omitting any action hereunder or thereunder, such matter (unless other evidence
in respect thereof is herein specifically prescribed) may be deemed to be
conclusively proved or established by a certificate of a responsible officer of
the Borrower delivered to the Collateral Agent, and such certificate shall be
full warrant to the Collateral Agent for any action taken, suffered or omitted
in reliance thereon, subject, however, to the provisions of Section 5.4.
(b) The Collateral Agent may consult with counsel, and any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered by it hereunder or under any Security
Document in accordance therewith. The Collateral Agent shall have the right at
any time to seek instructions concerning the administration of this Agreement
and the Security Documents from any court of competent jurisdiction.
(c) The Collateral Agent may rely, and shall be fully
protected in acting, upon any resolution, statement, certificate, instrument,
opinion, report, notice, request, consent, order, bond or other paper or
document which it has no reason to believe to be other than genuine and to have
been signed or presented by the proper party or parties or, in the case of
cables, telecopies and telexes, to have been sent by the proper party or
parties. In the absence of its own gross negligence or willful misconduct, the
Collateral Agent may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Collateral Agent and conforming to the requirements of
this Agreement.
(d) The Collateral Agent shall not be under any obligation
to exercise any of the rights or powers vested in the Collateral Agent by this
Agreement and the Security Documents unless the Collateral Agent shall have been
provided adequate security and indemnity against the costs, expenses and
liabilities which may be incurred by the Collateral Agent, including such
reasonable advances as may be requested by the Collateral Agent.
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(e) Any Opinion of Counsel may be based, insofar as it
relates to factual matters, upon a certificate of a responsible officer of the
Borrower or representations made by a responsible officer of the Borrower in a
writing filed with the Collateral Agent.
5.4 Limitations on Duties of Collateral Agent. (a) The
Collateral Agent shall be obligated to perform such duties and only such duties
as are specifically set forth in this Agreement and the Security Documents, and
no implied covenants or obligations shall be read into this Agreement or any
Security Document against the Collateral Agent. By acceptance of the benefits
under this Agreement and the Security Documents, the holders of External Sharing
Debt shall be deemed to have agreed that they shall not be entitled to, and
shall not, (i) direct the actions of the Collateral Agent hereunder or under any
Security Document, (ii) except as set forth in Section 6.3, have the right to
consent to any amendment, supplement, waiver or other modification to this
Agreement or any Security Document or to any release of Collateral or
Guarantees, (iii) take any action, or commence any legal proceeding seeking, to
require, compel or cause the Collateral Agent to enforce any of the provisions
of this Agreement or any Security Document against any Grantor or to exercise
any remedy hereunder or thereunder, (iv) take any action, or commence any legal
proceeding seeking, to prevent or enjoin the Collateral Agent from taking any
action (including, without limitation, the enforcement of any provisions of this
Agreement or any Security Document against any Grantor, the exercise of any
remedy hereunder or thereunder, the release of any Security Document, the
release of any Collateral or Guarantees, the consent to any amendment or
modification of this Agreement or any Security Document or the grant of any
waiver hereunder or thereunder), or refraining from taking any such action, in
accordance with this Agreement or any Security Document, as the case may be, or
(v) otherwise take any action, or commence any legal proceeding seeking, to
delay, hinder or otherwise impair the Collateral Agent in taking any such action
in accordance with this Agreement or any Security Document. By acceptance of the
benefits under this Agreement and the Security Documents, the holders of
External Sharing Debt, as Secured Parties, will be deemed to have acknowledged
and agreed that the provisions of the preceding sentence are intended to induce
the Lenders and the Grantors to permit such Persons to be Secured Parties under
this Agreement and under the Security Documents and are being relied upon by the
Lenders and the Grantors as consideration therefor.
(b) Except as herein otherwise expressly provided, the
Collateral Agent shall not be under any obligation to take any action which is
discretionary with the Collateral Agent under the provisions hereof or of any
Security Document. The Collateral Agent shall make available for inspection and
copying by the Administrative Agent each certificate or other paper furnished to
the Collateral Agent by any of the Grantors under or in respect of this
Agreement or any of the Collateral.
(c) No provision of this Agreement or of any Security
Document shall be deemed to impose any duty or obligation on the Collateral
Agent to perform any act or acts or exercise any right, power, duty or
obligation conferred or imposed on it, in any jurisdiction in which it shall be
illegal, or in which the Collateral Agent shall be unqualified or incompetent,
to perform any such act or acts or to exercise any such right, power, duty or
obligation or if such performance or exercise would constitute doing business by
the Collateral Agent in such jurisdiction or impose a tax on the Collateral
Agent by reason thereof or to risk its own funds or otherwise incur any
financial liability in the performance of its duties hereunder.
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5.5 Moneys to be Held in Trust. All moneys received by the
Collateral Agent under or pursuant to any provision of this Agreement or any
Security Document (except Collateral Agent Fees) shall be held in trust for the
purposes for which they were paid or are held.
5.6 Resignation and Removal of the Collateral Agent. (a) The
Collateral Agent may at any time, by giving written notice to the Borrower and
the Administrative Agent, resign and be discharged of the responsibilities
hereby created, such resignation to become effective upon (i) the appointment of
a successor Collateral Agent, (ii) the acceptance of such appointment by such
successor Collateral Agent and (iii) the approval of such successor Collateral
Agent evidenced by one or more instruments signed by the Administrative Agent
and the Borrower (which approval, in the case of the Borrower, shall not be
unreasonably withheld). If no successor Collateral Agent shall be appointed and
shall have accepted such appointment within 90 days after the Collateral Agent
gives the aforesaid notice of resignation, the Collateral Agent, the Borrower,
the Administrative Agent or any Lender may apply to any court of competent
jurisdiction to appoint a successor Collateral Agent to act until such time, if
any, as a successor Collateral Agent shall have been appointed as provided in
this Section 5.6. Any successor so appointed by such court shall immediately and
without further act be superseded by any successor Collateral Agent appointed by
the Administrative Agent as provided in Section 5.6(b). The Administrative Agent
may, at any time upon giving 30 days' prior written notice thereof to the
Collateral Agent, remove the Collateral Agent and appoint a successor Collateral
Agent reasonably acceptable to the Borrower, such removal to be effective upon
the acceptance of such appointment by the successor. The Collateral Agent shall
be entitled to Collateral Agent Fees to the extent incurred or arising, or
relating to events occurring, before such resignation or removal.
(b) If at any time the Collateral Agent shall resign or be
removed or otherwise become incapable of acting, or if at any time a vacancy
shall occur in the office of the Collateral Agent for any other cause, a
successor Collateral Agent may be appointed by the Administrative Agent with the
consent of the Borrower, which consent shall not be unreasonably withheld. The
powers, duties, authority and title of the predecessor Collateral Agent shall be
terminated and cancelled without procuring the resignation of such predecessor
and without any other formality (except as be required by applicable law) than
appointment and designation of a successor in writing duly acknowledged and
delivered to the predecessor and the Borrower. Such appointment and designation
shall be full evidence of the right and authority to make the same and of all
the facts therein recited, and this Agreement and the Security Documents shall
vest in such successor, without any further act, deed or conveyance, all the
estates, properties, rights, powers, duties, authority and title of its
predecessor; but such predecessor shall, nevertheless, on the written request of
the Administrative Agent, the Borrower, or the successor, execute and deliver an
instrument transferring to such successor all the estates, properties, rights,
powers, duties, authority and title of such predecessor hereunder and under the
Security Documents and shall deliver all Collateral held by it or its agents to
such successor. Should any deed, conveyance or other instrument in writing from
any Grantor be required by any successor Collateral Agent for more fully and
certainly vesting in such successor the estates, properties, rights, powers,
duties, authority and title vested or intended to be vested in the predecessor
Collateral Agent, any and all such deeds, conveyances and other instruments in
writing shall, on request of such successor, be executed, acknowledged and
delivered by such Grantor. If such Grantor shall not have executed and delivered
any such deed, conveyance or other instrument within 10 days after it receives a
written request from the successor Collateral Agent to do so, or
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if an Event of Default shall have occurred and be continuing, the predecessor
Collateral Agent may execute the same on behalf of such Grantor. Such Grantor
hereby appoints any predecessor Collateral Agent as its agent and attorney to
act for it as provided in the next preceding sentence.
5.7 Status of Successor Collateral Agent. Every successor
Collateral Agent appointed pursuant to Section 5.6 shall be a bank or trust
company in good standing and having power to act as Collateral Agent hereunder,
incorporated under the laws of the United States of America or any State thereof
or the District of Columbia and having its principal office within the 48
contiguous States and shall also have capital, surplus and undivided profits of
not less than $500,000,000, if there be such an institution with such capital,
surplus and undivided profits willing, qualified and able to accept the powers
and duties hereunder upon reasonable or customary terms.
5.8 Merger of the Collateral Agent. Any corporation into
which the Collateral Agent may be merged, or with which it may be consolidated,
or any corporation resulting from any merger or consolidation to which the
Collateral Agent shall be a party, shall be the Collateral Agent under this
Agreement and the Security Documents without the execution or filing of any
paper or any further act on the part of the parties hereto.
5.9 Co-Collateral Agent; Separate Collateral Agent. (a) If
at any time or times it shall be necessary or prudent in order to conform to any
law of any jurisdiction in which any of the Collateral shall be located, or to
avoid any violation of law or imposition on the Collateral Agent of taxes by
such jurisdiction not otherwise imposed on the Collateral Agent, or the
Collateral Agent shall be advised by counsel, satisfactory to it, that it is
necessary or prudent in the interest of the Secured Parties, or the Collateral
Agent shall deem it desirable for its own protection in the performance of its
duties hereunder or under any Security Document, the Collateral Agent and each
of the Grantors shall execute and deliver all instruments and agreements
necessary or proper to constitute another bank or trust company, or one or more
Persons approved by the Collateral Agent and the Grantors, either to act as
co-collateral agent or co-collateral agents of all or any of the Collateral
under this Agreement or under any of the Security Documents, jointly with the
Collateral Agent originally named herein or therein or any successor Collateral
Agent, or to act as separate collateral agent or collateral agents of any of the
Collateral. If any of the Grantors shall not have joined in the execution of
such instruments and agreements within 10 days after it receives a written
request from the Collateral Agent to do so, or if an Event of Default shall have
occurred and be continuing, the Collateral Agent may act under the foregoing
provisions of this Section 5.9(a) without the concurrence of such Grantors and
execute and deliver such instruments and agreements on behalf of such Grantors.
Each of the Grantors hereby appoints the Collateral Agent as its agent and
attorney to act for it under the foregoing provisions of this Section 5.9(a) in
either of such contingencies.
(b) Every separate collateral agent and every co-collateral
agent, other than any successor Collateral Agent appointed pursuant to Section
5.6, shall, to the extent permitted by law, be appointed and act and be such,
subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations
conferred upon the Collateral Agent in respect of the custody, control
and management of moneys, papers or securities shall be exercised solely
by the Collateral Agent or any agent appointed by the Collateral Agent;
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(ii) all rights, powers, duties and obligations
conferred or imposed upon the Collateral Agent hereunder and under the
relevant Security Documents shall be conferred or imposed and exercised
or performed by the Collateral Agent and such separate collateral agent
or separate collateral agents or co-collateral agent or co-collateral
agents, jointly, as shall be provided in the instrument appointing such
separate collateral agent or separate collateral agents or co-collateral
agent or co-collateral agents, except to the extent that under any law
of any jurisdiction in which any particular act or acts are to be
performed the Collateral Agent shall be incompetent or unqualified to
perform such act or acts, or unless the performance of such act or acts
would result in the imposition of any tax on the Collateral Agent which
would not be imposed absent such joint act or acts, in which event such
rights, powers, duties and obligations shall be exercised and performed
by such separate collateral agent or separate collateral agents or
co-collateral agent or co-collateral agents;
(iii) no power given hereby or by the relevant
Security Documents to, or which is provided herein or therein may be
exercised by, any such co-collateral agent or co-collateral agents or
separate collateral agent or separate collateral agents shall be
exercised hereunder or thereunder by such co-collateral agent or
co-collateral agents or separate collateral agent or separate collateral
agents except jointly with, or with the consent in writing of, the
Collateral Agent, anything contained herein to the contrary
notwithstanding;
(iv) no collateral agent hereunder shall be
personally liable by reason of any act or omission of any other
collateral agent hereunder; and
(v) the Borrower and the Collateral Agent, at any
time by an instrument in writing executed by them jointly, may accept
the resignation of or remove any such separate collateral agent or
co-collateral agent and, in that case by an instrument in writing
executed by them jointly, may appoint a successor to such separate
collateral agent or co-collateral agent, as the case may be, anything
contained herein to the contrary notwithstanding. If the Borrower shall
not have joined in the execution of any such instrument within 10 days
after it receives a written request from the Collateral Agent to do so,
or if an Event of Default shall have occurred and be continuing, the
Collateral Agent shall have the power to accept the resignation of or
remove any such separate collateral agent or co-collateral agent and to
appoint a successor without the concurrence of the Borrower, the
Borrower hereby appointing the Collateral Agent its agent and attorney
to act for it in such connection in such contingency. If the Collateral
Agent shall have appointed a separate collateral agent or separate
collateral agents or co-collateral agent or co-collateral agents as
above provided, the Collateral Agent may at any time, by an instrument
in writing, accept the resignation of or remove any such separate
collateral agent or co-collateral agent and the successor to any such
separate collateral agent or co-collateral agent shall be appointed by
the Borrower and the Collateral Agent, or by the Collateral Agent alone
pursuant to this Section 5.9(b).
5.10 Treatment of Payee or Indorsee by Collateral Agent;
Representatives of Secured Parties. (a) The Collateral Agent may treat the
registered holder or, if none, the payee or indorsee of any promissory note or
debenture evidencing an Obligation as the absolute owner thereof for all
purposes and shall not be affected by any notice to the contrary, whether such
promissory note or debenture shall be past due or not.
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(b) If requested by the Collateral Agent, any Person (other
than the Administrative Agent) which shall be designated as the duly authorized
representative of one or more Secured Parties to act as such in connection with
any matters pertaining to this Agreement or the Collateral shall present to the
Collateral Agent such documents, including, without limitation, Opinions of
Counsel, as the Collateral Agent may reasonably require, in order to demonstrate
to the Collateral Agent the authority of such Person to act as the
representative of such Secured Parties (it being understood that the holders of
Borrower Obligations are represented hereunder by the Administrative Agent). The
authority of the Administrative Agent shall be demonstrated by their inclusion
as such in the lists from time to time delivered pursuant to Section 4.2.
SECTION 6.
MISCELLANEOUS
6.1 Notices. Unless otherwise specified herein, all notices,
requests, demands or other communications given to any of the Grantors, the
Collateral Agent, the Administrative Agent or any holder of External Sharing
Debt shall be given in writing or by facsimile transmission and shall be deemed
to have been duly given when personally delivered or when duly deposited in the
mails, registered or certified mail postage prepaid, or when transmitted by
facsimile transmission, addressed (i) if to any Grantor, to such party at its
address specified in the Guarantee and Collateral Agreement or any other address
which such party shall have specified as its address for the purpose of
communications hereunder, by notice given in accordance with this Section 6.1 to
the party sending such communication, (ii) if to the Collateral Agent at its
address at One Chase Manhattan Plaza, Eighth Floor, New York, New York, 10081,
Attention of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ (Facsimile No. 212-552-5700) or any other address
which such party shall have specified as its address for the purpose of
communications hereunder, by notice given in accordance with this Section 6.1 to
the party sending such communication, (iii) if to the Administrative Agent, to
it at its address specified from time to time in the list delivered by the
Borrower to the Collateral Agent pursuant to Section 4.2 or (iv) if to any
holder of External Sharing Debt, to it at its address specified in its Sharing
Acknowledgement or, if more recently provided, to it at its address specified
from time to time in the list delivered by the Borrower to the Collateral Agent
pursuant to Section 4.2; provided that any notice, request or demand to the
Collateral Agent shall not be effective until received by the Collateral Agent
in writing or by facsimile transmission at the office designated by it pursuant
to this Section 6.1.
6.2 No Waivers. No failure on the part of the Collateral
Agent, any co-collateral agent, any separate collateral agent, the
Administrative Agent or any other Secured Party to exercise, no course of
dealing with respect to, and no delay in exercising, any right, power or
privilege under this Agreement or any Security Document shall operate as a
waiver thereof nor shall any single or partial exercise of any such right, power
or privilege preclude any other or further exercise thereof or the exercise of
any other right, power or privilege.
6.3 Amendments, Supplements and Waivers. With the written
consent of the Administrative Agent, the Collateral Agent and the Grantors may,
from time to time, enter into written agreements supplemental hereto or to any
Security Document for the purpose of adding to, or waiving any provisions of,
this Agreement or any Security Document or changing in any manner the rights of
the Collateral Agent, the Secured Parties or the Grantors hereunder or
thereunder; provided, however, that no such agreement shall amend the provisions
of Section 3.4 to change the order of priority of distributions, or subordinate
any Secured Party, without the
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consent of each Secured Party directly affected thereby. In addition, if the
Administrative Agent shall advise the Collateral Agent in writing that the
Required Lenders (under and as defined in each of the Credit Agreements) have
agreed with the Borrower that additional indebtedness, liabilities or
obligations of the Borrower shall be secured by all or any portion of the
Collateral, the Collateral Agent shall enter into such supplemental agreements
satisfactory to the Collateral Agent with the Grantors as shall be reasonably
requested by the Administrative Agent to effect such agreement (which
supplemental agreement may be in the form of an amendment and restatement of
this Agreement). Any waiver, amendment, modification or supplemental agreement
entered into pursuant to this Section 6.3 shall be binding upon the Grantors,
the Administrative Agent, the other Secured Parties and the Collateral Agent and
their respective successors.
6.4 Headings. The table of contents and the headings of
Sections have been included herein and in the Security Documents for convenience
only and should not be considered in interpreting this Agreement or the Security
Documents.
6.5 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall not invalidate the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
6.6 Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of each of the parties hereto and their respective
successors and assigns and shall inure to the benefit of each of the Secured
Parties and their respective successors and assigns, and nothing herein is
intended or shall be construed to give any other Person any right, remedy or
claim under, to or in respect of this Agreement or any Collateral.
6.7 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
6.8 Counterparts. This Agreement may be signed in any number
of counterparts with the same effect as if the signatures thereto and hereto
were upon the same instrument.
6.9 Termination. (a) Upon receipt by the Collateral Agent
from the Administrative Agent of (i) a written direction to cause the liens
created by Section 4.7 and by the Security Documents to be released and
discharged or (ii) a written notice stating that each of the Credit Agreements
has terminated in accordance with the terms thereof, and payment in full of all
Collateral Agent Fees, the security interests created by Section 4.7 and by the
Security Documents shall terminate forthwith and all right, title and interest
of the Collateral Agent in and to the Collateral shall revert to the Grantors,
their successors and assigns.
(b) Upon the termination of the Collateral Agent's security
interest and the release of the Collateral in accordance with Section 6.9(a),
the Collateral Agent will promptly, at the Borrower's written request and
expense, (i) execute and deliver to the Borrower such documents as the Borrower
shall reasonably request to evidence the termination of such security interest
or the release of the Collateral and (ii) deliver or cause to be delivered to
the Grantors all property of the Grantors then held by the Collateral Agent or
any agent thereof.
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(c) This Agreement shall terminate when the security
interest granted under the Security Documents has terminated and the Collateral
has been released; provided that the provisions of Sections 4.3, 4.4, 4.5 and
4.6 shall not be affected by any such termination.
(d) The Collateral Agent will, at any time, upon the written
instruction of the Administrative Agent, at the sole expense of the relevant
Grantor, execute and deliver to the relevant Grantor all releases or other
documents reasonably necessary or desirable for the release of the Liens created
by the Security Documents on the Collateral specified by the Administrative
Agent in such instruction. The Administrative Agent may give such instructions
at any time, whether or not at any such time any or all of the Obligations are
still outstanding.
6.10 Inspection by Regulatory Agencies. The Collateral Agent
shall make available, and shall cause each custodian and agent acting on its
behalf in connection with this Agreement to make available, all Collateral in
such Person's possession at all times for inspection by any regulatory agency
having jurisdiction over a Grantor to the extent required by such regulatory
agency in its discretion.
6.11 Agreement to be Bound. Pursuant to Section 8.17 of the
Guarantee and Collateral Agreement, each Grantor that is a Subsidiary of the
Borrower has agreed to be bound by the terms of this Agreement and, without
limiting the generality of the foregoing, has expressly agreed that all
obligations and liabilities of a Grantor hereunder apply to such Grantor with
the same force and effect as if such Grantor were a signatory hereto.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first written above.
LUCENT TECHNOLOGIES INC.
By:
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Name:
Title:
THE CHASE MANHATTAN BANK,
as Collateral Agent
By:
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Name:
Title: