Exhibit 10.2
CASH COLLATERAL
AGREEMENT
THIS AGREEMENT
is made as of the 18
th day of June, 2009 among NORTEL NETWORKS
LIMITED (the “ Principal ”) and EXPORT
DEVELOPMENT CANADA (“ EDC ”).
RECITALS:
WHEREAS , pursuant to a Second Amended and Restated
Master Facility Agreement dated as of December 14, 2007
between the Principal and EDC (the “ Facility
Agreement ”), EDC agreed to provide Support for the
benefit of the Principal and its affiliates, subject to the terms
and conditions of the Facility Agreement;
WHEREAS the Principal commenced a voluntary proceeding
seeking relief including an initial order (as amended, the “
Initial Order ”) under the Companies’
Creditors Arrangement Act (Canada) (the “ CCAA
Proceeding ”) and the Principal’s subsidiaries have
commenced administration proceedings in the United Kingdom and
restructuring proceedings under Chapter 11 of the United
States Bankruptcy Code;
WHEREAS the Principal and EDC entered into an Agreement
dated as of January 14, 2009, as amended by the Amended and
Restated Short-Term Support Agreement dated as of February 10,
2009, by and between the Principal and EDC, as further amended by
the Second Amended and Restated Short-Term Support Agreement dated
as of April 24, 2009 by and between the Principal and EDC
(collectively, the “ Original Agreement ”),
pursuant to which EDC agreed, among other things, that, until
July 30, 2009, new Support would continue to be made available
to the Principal under the Facilities, to an aggregate maximum
amount of USD 30 million; and
WHEREAS the Principal and EDC have further amended the
terms and conditions of the Original Agreement as of the date
hereof;
NOW THEREFORE
for valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties hereto covenants, acknowledges, represents and warrants to
and in favour of each other as follows:
The Principal confirms the validity
and truth of the facts set forth in the Recitals to this Cash
Collateral Agreement, which have the same force and effect as if
repeated herein at length.
Capitalized terms used in this
Agreement and not otherwise defined herein have the meanings given
to them in the Initial Order, the Facility Agreement and the
Original
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Agreement. Unless the context otherwise
requires, in this Agreement the following terms are used with their
corresponding defined meanings:
“Agreement” means this agreement. The terms “ this
Agreement ”, “ hereof ”, “
hereunder ” and similar expressions refer to this
Agreement and not to any particular Article, Section, Subsection,
paragraph, clause or other portion of this Agreement. Each
reference to a “Schedule” in this Agreement is a
reference to a Schedule attached to this Agreement which shall form
an integral part hereof.
“ Business Day ”
means a day which is not a Saturday or a Sunday on which banks and
trust companies are generally open for business in Toronto,
Canada.
“ Collateral ”
means (i) the Support Collateral, (ii) the Deposit, and
(iii) all proceeds of personal property described in this
definition and subject to the security hereby
constituted.
“ Collateral Delivery
Account ” means a U.S. dollar account of EDC at Royal
Bank of Canada’s branch located at 151 O’Connor
Street, Ottawa, ON identified as 00006-4015906 (SWIFT
ROYCCAT2).
“ Deposit ” has
the meaning ascribed thereto in Schedule B of the Original
Agreement.
“ Fees and Expenses
Letter ” means the fees and expenses letter dated
January 27, 2009 by EDC as agreed to and accepted by the
Principal January 28, 2009.
“ Lien ” means
(i) any right of set-off intended to secure the payment or
performance of an obligation, (ii) any interest in property
created by way of mortgage, pledge, charge, lien, assignment by way
of security, hypothecation, security interest, hire purchase
agreement, conditional sale agreement, sale/lease back transaction,
deposit arrangement, title retention, capital lease or discount,
factoring or securitization arrangement on recourse terms,
(iii) any statutory deemed trust or lien, (iv) any
preference, priority, adverse claim, levy, execution, seizure,
attachment, garnishment or other encumbrance which binds property,
and (v) any agreement to grant any of the rights or interests
described in clauses (i) to (iv) inclusive of this
definition.
“ Obligations ”
means all of the Principal’s present and future payment,
reimbursement and indemnity obligations owing to EDC under the
Original Agreement and the Fees and Expenses Letter. For greater
clarity, Obligations shall not include Unsecured Renewal Support
(as defined in the Original Agreement).
“ Security ”
means any and all Liens granted by the Principal to EDC in this
Agreement.
“ Support Collateral
” means the funds transferred by the Principal to EDC
pursuant to Sections 5 and 6 hereof.
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Extended Meanings
To the extent the context so admits,
in this Agreement the following words and expressions shall be
given the extended meanings set out opposite them:
an “ agreement ”
– any agreement, oral or written, simple contract or
specialty, bond, bill of exchange, indenture, instrument or
undertaking.
an “ asset ”
– any undertaking, business, property (real, personal or
mixed, tangible or intangible) goodwill or other asset.
an “ authorization
” – any authorization, approval, consent, exemption,
licence, permit, franchise, quota, privilege or no-action letter
from any governmental authority or from any person in connection
with any easements or contractual rights.
“ change ”
– change, modify, alter, amend, supplement, extend, renew,
compromise, novate, replace, terminate, release, discharge, cancel,
suspend or waive.
“ claim ” –
claim, claim over, cross-claim, counter-claim, defence, demand,
liability, suit, action or proceeding, judgment, order or award of
any court, other governmental authority, arbitrator or other
alternative dispute resolution authority.
a “ document ”
– a written agreement, consent, waiver, certificate, notice
or other written document or instrument.
a “ final judgment
” – a judgment, order, declaration or award of a court,
other governmental authority, arbitrator or other alternative
dispute resolution authority of competent jurisdiction from which
no appeal may be made or from which all rights of appeal have
expired or been exhausted.
a “ government ”
– (i) the Crown in right of Canada or in the right of
any Province of Canada, (ii) the government of a Territory in
Canada, (iii) a municipality in Canada or (iv) the
government of a foreign country or any political subdivision of
it.
a “governmental
authority” – any court, administrative tribunal,
regulatory authority, government, union of nations or any agency or
other authority of a government or union of nations.
“ include ”
– to be interpreted as if followed by the term “without
limitation”, and such term shall not be construed to limit
any word or statement which it follows to the specific items or
matters immediately following it or similar terms or
matters.
“ losses and expenses
” – losses, costs, expenses, damages, penalties and
judgments and awards of any court or other governmental authority,
arbitrator, mediator or other alternative dispute resolution
authority, including any applicable awarded costs, and legal fees
and disbursements on a full indemnity basis.
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“ obligations ”
– indebtedness, obligations, promises, covenants,
responsibilities, duties and liabilities (actual or contingent,
direct or indirect, matured or unmatured, now existing or arising
hereafter), whether arising by agreement or statute, at law, in
equity or otherwise.
“ paid in full ”
in relation to any payment obligation owing to any person (the
“obligee”)—permanent, indefeasible and
irrevocable payment in cash (or other freely available funds
transfer as may be expressly provided for in the applicable
document creating or evidencing such payment obligation) to the
applicable obligee in full of such payment obligation in accordance
with the express provisions of the applicable document creating or
evidencing such payment obligation, without regard to any
compromise, reduction or disallowance of all or any item or part
thereof by virtue of the application of any bankruptcy, insolvency,
fraudulent conveyance, assignment, preference or other similar such
laws, any law affecting creditors’ rights generally or
general principles of equity, and, if applicable, the cancellation
or expiry of any commitment of the obligee to len
