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EXHIBIT 10-9
INTERCREDITOR AGREEMENT
THIS
INTERCREDITOR AGREEMENT (this "Intercreditor Agreement"), dated as
of
May 31, 2006 (the "Effective Date"), is made by and between
CAPITALSOURCE
FINANCE LLC, a Delaware limited liability company, not
individually, but in its
capacity as agent (in such capacity, the "Working Capital Agent"
(as hereinafter
further defined)) for the benefit of each entity (each a "Working
Capital
Lender" and collectively, the "Working Capital Lenders" (as
hereinafter further
defined)) who may from time to time be a "Lender" or a "Lender
Party" under (and
as defined in) the Working Capital Credit Agreement (as defined
below); and CSE
MORTGAGE LLC, a Delaware limited liability company, not
individually, but in its
capacity as agent (in such capacity, the "Term Loan Agent" (as
hereinafter
further defined)) for the benefit of each entity (each a "Term Loan
Lender" and
collectively, the "Term Loan Lenders" (as hereinafter further
defined)) who may
from time to time be a "Lender" or a "Lender Party" under (and as
defined in)
the Term Loan Financing Agreement (as defined below).
RECITALS:
A. Working Capital Agent and Working Capital Lenders have entered
into
the Working Capital Credit Agreement with the Borrowers (as
hereinafter
defined), pursuant to which Working Capital Lenders have made and
may, upon
certain terms and conditions, continue to make loans and provide
other financial
accommodations to Borrowers secured by a security interest in
substantially all
of the assets and properties of Borrowers.
B. Term Loan Agent and Term Loan Lenders have entered into the
Term
Loan Financing Agreement with the Borrowers, pursuant to which Term
Loan Lenders
have made term loans to Borrowers secured by security interests in
substantially
all of the assets and properties of Borrowers.
C. Working Capital Agent has been authorized to enter into this
Agreement on behalf of the Working Capital Lenders pursuant to the
Working
Capital Credit Agreement, and to bind all Working Capital Lenders
pursuant
hereto.
D. Term Loan Agent has been authorized to enter into this Agreement
on
behalf of the Term Loan Lenders pursuant to the Term Loan Financing
Agreement,
and to bind all Term Loan Lenders pursuant hereto.
E. Working Capital Agent and Term Loan Agent desire to enter into
this
Intercreditor Agreement to (i) confirm the relative priorities of
the respective
security interests of Working Capital Agent and Working Capital
Lenders and Term
Loan Agent and Term Loan Lenders in the assets and properties of
Borrowers and
any other Obligors, (ii) provide for the orderly sharing among
them, in
accordance with such priorities, of the proceeds of such assets and
properties
upon any foreclosure thereon or other disposition thereof and (iii)
make certain
other agreements relative to the foregoing.
In
consideration of the mutual benefits accruing to Working Capital
Agent,
Working Capital Lenders, Term Loan Agent and Term Loan Lenders
hereunder and
other good and
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valuable consideration, the receipt and sufficiency of which are
hereby
acknowledged, the parties hereto do hereby agree as follows:
1.
DEFINITIONS.
As
used above and in this Intercreditor Agreement, the following
terms
shall have the meanings ascribed to them below:
1.1 "Accounts" shall mean any "accounts," as such term is defined
in
the UCC, now owned or hereafter acquired by any Obligor or in which
any Obligor
now has or hereafter acquires any rights (whether or not
specifically listed on
any schedule furnished to the Secured Party pursuant hereto or in
connection
herewith), and, in any event, shall include, without limitation,
all accounts
receivable, book debts and other forms of obligations (other than
forms of
obligations evidenced by Chattel Paper, Documents, Investment
Property or
Instruments) now owned or hereafter received or acquired by or
belonging or
owing to any Obligor (including, without limitation, under any
trade names,
styles or divisions thereof) whether arising out of goods sold or
leased or
services rendered by any Obligor or from any other transaction,
whether or not
the same involves the sale or lease of goods or services by any
Obligor
(including, without limitation, any such obligation, that might be
characterized
as an account or contract right under the UCC) and all of any
Obligor's rights
in, to and under all purchase orders or receipts now owned or
hereafter acquired
by it for goods or services, and all of any Obligor's rights to any
goods
represented by any of the foregoing (including, without limitation,
unpaid
seller's rights of rescission, replevin, reclamation and stoppage
in transit and
rights to returned, reclaimed or repossessed goods), and all moneys
due or to
become due to any Obligor under all contracts for the sale of goods
or the
performance of services or both by any Obligor (whether or not yet
earned by
performance on the part of any Obligor or in connection with any
other
transaction), now in existence or hereafter occurring, including,
without
limitation, the right to receive the proceeds of said purchase
orders and
contracts, the right to receive all proceeds of any credit
insurance policies
relating thereto issued in any Obligor's favor, and all collateral
security,
Supporting Obligations and guarantees of any kind given by any
Person with
respect to any of the foregoing.
1.2 "Agents" shall mean, collectively, the Term Loan Agent and
the
Working Capital Agent.
1.3 "Agreements" shall mean, collectively, the Working Capital
Loan
Agreements and the Term Loan Agreements.
1.4 "Balances" shall mean and include: (i) all property of each
Obligor left with any Lender; (ii) any and all Deposit Accounts of
each Obligor
now or hereafter opened with any Lender, together with all funds
from time to
time on deposit therein; (iii) all certificates of deposit issued
by any Lender
to any Obligor; and (iv) all drafts, checks and other items
deposited in or with
any Lender by any Obligor for collection now or hereafter. The term
"Balances"
further extends to and includes all "Blocked Accounts" and any
"Lockbox
Account," as those quoted terms are defined in the Working Capital
Credit
Agreement and the Term Loan Financing Agreement, and all funds from
time to time
on deposit therein.
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1.5 "Borrowers" shall mean LEXINGTON PRECISION CORPORATION, a
Delaware
corporation, and LEXINGTON RUBBER GROUP, INC., a Delaware
corporation; and their
respective successors and assigns, including, without limitation,
any receiver,
trustee or debtor-in-possession on behalf of such Person or on
behalf of any
such successor or assign.
1.6 "Chattel Paper" shall mean any "chattel paper," as such term
is
defined in the UCC, including, without limitation, electronic
chattel paper and
tangible chattel paper, now owned or hereafter acquired by any
Obligor or in
which any Obligor now has or hereafter acquires any rights,
wherever located.
1.7 "Collateral" shall mean, collectively, the Working Capital
Collateral and the Term Loan Collateral.
1.8 "Commercial Tort Claim" shall mean any "commercial tort claim",
as
such term is defined in the UCC, now owned or hereafter acquired by
any Obligor
or in which any Obligor now has or hereafter acquires any
rights.
1.9 "Contracts" shall mean all contracts, undertakings, or
other
agreements (other than rights evidenced by Chattel Paper,
Documents, Investment
Property or Instruments) in or under which any Obligor may now or
hereafter have
any right, title or interest, with respect to any Collateral
(including any
agreement relating to the terms of payment or the terms of
performance thereof).
1.10 "Debt" shall mean, collectively, (i) Term Loan Debt and
(ii)
Working Capital Debt.
1.11 "Deposit Accounts" shall mean all "deposit accounts", as
such
term is defined in the UCC, now or hereafter held in the name of an
Obligor by
any Lender.
1.12 "Documents" shall mean any "documents," as such term is
defined
in the UCC, now owned or hereafter acquired by any Obligor or in
which any
Obligor now has or hereafter acquires any rights, wherever located,
with respect
to any Accounts or any Inventory.
1.13 "Equipment" shall mean any "equipment", as such term is
defined
in the UCC, now owned or hereafter acquired by an Obligor or in
which an Obligor
now has or hereafter acquires any rights, wherever located,
including, without
limitation, all machinery, motor vehicles, fittings, furniture,
furnishings,
Fixtures, molds, discs, tools, stamps, parts, accessories and all
replacements
and substitutions therefor or accessions thereto, and all Software
embedded
therein.
1.14 "Event of Default" shall mean each "Event of Default" or
similar
term, as such term is defined in any Working Capital Loan Agreement
or any Term
Loan Agreement, so long as any such Agreement is in effect.
1.15 "Exigent Circumstance" shall mean an event or circumstance
that
in the judgment of Term Loan Agent, as to the Term Loan Priority
Collateral, or
the judgment of Working Capital Agent, as to the Working Capital
Priority
Collateral, immediately threatens the value of, or its ability to
realize upon,
all or any material portion of such Collateral, including,
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for example, but without limitation, fraudulent removal,
concealment or
abscondment thereof, or destruction or material waste thereof, or
abandonment
thereof.
1.16 "Fixtures" shall mean any "fixtures", as such term is defined
in
the UCC, now owned or hereafter acquired by an Obligor or in which
an Obligor
now has or hereafter acquires any rights and wherever located.
1.17 "General Intangibles" shall mean any "general intangibles,"
as
such term is defined in the UCC, now owned or hereafter acquired by
any Obligor
or in which any Obligor now has or hereafter acquires any rights
with respect to
any Accounts or any Inventory, and, in any event, shall include,
without
limitation, all right, title and interest that any Obligor may now
or hereafter
have in or under any Contract, causes of action, franchises, tax
refund claims,
customer lists, software, data bases, business records data, all
claims under
guarantees, security interests or other security held by or granted
to any
Obligor to secure payment of the Accounts by an account debtor
obligated
thereon, all rights of indemnification and all other intangible
property of any
kind and nature relating to any Accounts or any Inventory.
1.18 "Goods" shall mean any "goods", as such term is defined in
the
UCC, now owned or hereafter acquired by any Obligor or in which any
Obligor now
has or hereafter acquires any rights and wherever located,
including, without
limitation, embedded Software to the extent included therein.
Without limitation
of the foregoing, but for avoidance of any doubt, the term "Goods"
includes all
Equipment.
1.19 "Insolvency Proceeding" shall mean, as to any Person, any of
the
following: (i) any case or proceeding with respect to such Person
under the U.S.
Bankruptcy Code or any other Federal or State bankruptcy,
insolvency,
reorganization or other law affecting creditors' rights or any
other or similar
proceedings seeking any stay, reorganization, arrangement,
composition or
readjustment of the obligations and indebtedness of such Person or
(ii) any
proceeding seeking the appointment of any trustee, receiver,
liquidator,
custodian or other insolvency official with similar powers with
respect to such
Person or any of its assets or (iii) any proceeding for
liquidation, dissolution
or other winding up of the business of such Person or (iv) any
assignment for
the benefit of creditors or any marshalling of assets of such
Person.
1.20 "Instruments" shall mean any "instrument," as such term is
defined in the UCC, now owned or hereafter acquired by any Obligor
or in which
any Obligor now has or hereafter acquires any rights, wherever
located, other
than instruments that constitute, or are a part of a group of
writings that
constitute, Chattel Paper or Investment Property.
1.21 "Inventory" shall mean any "inventory," as such term is
defined
in the UCC, now owned or hereafter acquired by any Obligor or in
which any
Obligor now has or hereafter acquires any rights, wherever located,
and, in any
event, shall include, without limitation, all inventory held for
sale or lease,
or furnished or to be furnished under a contract of service or that
constitute
raw materials, work in process or materials used or consumed or to
be used or
consumed in any Obligor's business, or in the processing,
packaging, delivery or
shipping of the same, all Inventory returned to or repossessed by
any Obligor.
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1.22 "Investment Property" shall mean any "investment property",
as
that term is defined in the UCC, of each Obligor now owned or
hereafter acquired
by any Obligor, or in which any Obligor now has or hereafter
acquires any
rights. The term "Investment Property" extends to and includes all
capital
stock, partnership interests and membership interests in each
Person (including
another Borrower or any Obligor) owned by an Obligor.
1.23 "Lender Agreements" shall mean, collectively, (i) the
Working
Capital Loan Agreements and (ii) the Term Loan Agreements.
1.24 "Lenders" shall mean, collectively, the Working Capital
Agent,
the Working Capital Lenders, the Term Loan Agent and the Term Loan
Lenders, and
their respective successors and assigns, each being sometimes
referred to herein
individually as a "Lender".
1.25 "Letter-of-Credit Rights" shall mean letter-of-credit rights,
as
such term is defined in the UCC, now owned or hereafter acquired by
any Obligor,
including, without limitation, rights to payment or performance
under a letter
of credit, whether or not such Obligor, as beneficiary, has
demanded or is
entitled to demand payment or performance, with respect to any
Accounts or any
Inventory.
1.26 "Lien" shall mean any mortgage, deed of trust, pledge,
hypothecation, assignment, deposit arrangement, security interest,
encumbrance
(including, but not limited to, easements, rights of way and the
like), lien
(statutory or other), security agreement or transfer intended as
security,
including without limitation, any conditional sale or other title
retention
agreement, the interest of a lessor under a capital lease or any
financing lease
having substantially the same economic effect as any of the
foregoing.
1.27 "Lien Enforcement Action" shall mean (a) any action by any
Lender
to foreclose on the Lien of such Person on all or a material
portion of the
Collateral, (b) any action by any Lender to take possession of,
sell or
otherwise realize (judicially or non-judicially) upon all or a
material portion
of the Collateral (including, without limitation, by setoff or
notification of
account debtors), and/or (c) the commencement by any Lender of any
legal
proceedings against any Obligor or with respect to all or a
material portion of
the Collateral to facilitate any of the actions described in
clauses (a) and (b)
above. Notwithstanding the foregoing, the term "Lien Enforcement
Action" does
not include actions taken by any Working Capital Lender in
connection with (i)
cash management services performed for any Obligor, whether at such
Obligor's
request or as required by the terms of the Working Capital Credit
Agreement as
in effect on the date hereof, or (ii) the collection of Accounts
through lockbox
or blocked account arrangements, regardless of whether such
collection occurs
prior to or following any Working Capital Default; provided,
however, that for
purposes of clarification, the term "Lien Enforcement Action" does
include
notification of account debtors to make payments thereon directly
to any Lender
or its agent.
1.28 "Obligors" shall mean, individually and collectively, the
Borrowers together with any Person or Persons at any time or from
time to time
liable on or in respect of the Term Loan Debt or the Working
Capital Debt, and
each of their respective successors and assigns, including, without
limitation,
a receiver, trustee or debtor-in-possession on behalf of such
Person or on
behalf of any such successor or assign.
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1.29 "payment in full" or "paid in full" and phrases of like
import
mean (a) with respect to Working Capital Debt, (i) in the case of
Working
Capital Debt consisting of outstanding letter of credit
accommodations, the
termination of such letter of credit accommodations or the receipt
by Working
Capital Agent of cash collateral in an amount equal to 105% of the
aggregate
undrawn face amount thereof and (ii) in the case of all other
Working Capital
Debt, payment in full thereof in cash or other immediately
available funds (or,
so long as the same is accepted voluntarily by Working Capital
Lenders, other
property or securities of any Person), and termination of all
commitments to
extend any further credit in regard thereto and (b) in the case of
Term Loan
Debt, payment in full thereof in cash or other immediately
available funds (or
so long as the same is accepted voluntarily by Term Loan Lenders,
other property
or securities of any Person), and termination of all commitments to
extend any
further credit in regard thereto.
1.30 "Person" shall mean any individual, sole proprietorship,
partnership, corporation (including without imitation, any
corporation that
elects subchapter S status under the Internal Revenue Code of 1986,
as amended),
limited liability company, limited liability partnership, business
trust,
unincorporated association, joint stock company, trust, joint
venture, or other
entity or any government or any agency, instrumentality or
political subdivision
thereof.
1.31 "Proceeds" shall mean "proceeds," as such term is defined the
UCC
and, in any event, shall include, without limitation, (i) any and
all proceeds
of any insurance, indemnity, warranty or guaranty payable to any
Obligor from
time to time with respect to any of the Collateral, (ii) any and
all payments
(in any form whatsoever) made or due and payable to Obligor from
time to time in
connection with any requisition, confiscation, condemnation,
seizure or
forfeiture of all or any part of the Collateral by any governmental
body,
authority, bureau or agency (or any person acting under color of
governmental
authority), (iii) any and all other amounts from time to time paid
or payable
under or in connection with or distributed on account of any of the
Collateral
(including, without limitation, all distributions, dividends and
other amounts
payable with respect to Investment Property), and (iv) the
following types of
property acquired with cash proceeds: Accounts, Chattel Paper,
Contracts,
Documents, General Intangibles, Investment Property, Balances,
Inventory and
Goods.
1.32 "Real Property" shall mean all real property, or interests
in
real property (including leasehold interests) now owned or
hereafter acquired by
an Obligor or in which an Obligor now has or hereafter acquires any
rights,
wherever located. Without limitation of the foregoing, for
avoidance of any
doubt, the term "Real Property" extends to and includes all "Real
Property
Collateral" as that term is defined in the Term Loan Financing
Agreement.
1.33 "Software" shall mean all "software", as such term is defined
in
the UCC, now owned or hereafter acquired by any Obligor, other than
software
embedded in any category of Goods, including, without limitation,
all computer
programs and all supporting information provided in connection with
a
transaction related to any program.
1.34 "Supporting Obligations" means all supporting obligations,
as
such term is defined in the UCC, including, without limitation,
letters of
credit and guaranties issued in support of Accounts, Chattel Paper,
Documents,
General Intangibles, Instruments, or Investment Property.
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1.35 "Term Loan Agent" shall mean CSE MORTGAGE LLC, a Delaware
limited
liability company, in its capacity as Agent pursuant to the Term
Loan Financing
Agreement for the benefit and on behalf of Term Loan Lenders, and
its successors
and assigns (and including, without limitation, any successor,
assignee or
additional Person at any time acting as agent for the benefit of or
on behalf of
it and/or Term Loan Lenders).
1.36 "Term Loan Agreements" shall mean the Term Loan Financing
Agreement, and all agreements, documents and instruments at any
time executed
and/or delivered by Borrowers or any Obligor or any other Person
with, to or in
favor of Term Loan Agent or any Term Loan Lender in connection
therewith or
related thereto, as all of the foregoing now exist or may hereafter
be amended,
modified, supplemented, extended, renewed or restated.
1.37 "Term Loan Collateral" shall mean all assets and properties
of
any kind whatsoever, real or personal, tangible or intangible,
wherever located,
of Borrowers or any Obligor, in which a Lien is now or hereafter
granted,
obtained or otherwise claimed by Term Loan Agent or any Term Loan
Lender to
secure payment of any Term Loan Debt.
1.38 "Term Loan A Debt" shall mean all Term Loan Debt, other than
Term
Loan Debt in excess of the Term Loan A Debt Cap.
1.39 "Term Loan A Debt Cap" shall mean an aggregate amount of
Term
Loan Debt equal to the sum Eleven Million Dollars ($11,000,000)
plus all
interest, fees, costs, expenses, indemnities and other amounts
payable in
respect of the "Term Loan A" (as defined in the Term Loan Financing
Agreement)
pursuant to the terms of the Term Loan Agreements, whether or not
the same are
added to the principal amount of the Term Loan Debt (including
interest that
would be payable as post-petition interest in connection with any
Insolvency
Proceeding), less all repayments (including mandatory and voluntary
prepayments)
of principal in respect of such Term Loan A made subsequent to the
Effective
Date.
1.40 "Term Loan A Repayment Date" the date on which all Term Loan
A
Debt has been paid in full.
1.41 "Term Loan Debt" shall mean all loans and advances or
extensions
of credit made or to be made by any Lender to any Obligor, or to
others for any
Obligor's account, in each case, pursuant to the terms and
provisions of the
Term Loan Financing Agreement or any of the Term Loan Agreements,
together with
interest thereon (including interest that would be payable as
post-petition
interest in connection with any Insolvency Proceeding) and all
indebtedness,
fees, liabilities and obligations that may at any time be owing by
any Obligor
to any Lender, in each case pursuant to the Term Loan Financing
Agreement or any
of the Term Loan Agreements whether now in existence or incurred by
any Obligor
from time to time hereafter, whether unsecured or secured by a
pledge of, Lien
upon or security interest in any of any Obligor's assets or
property or the
assets or property of any other Person, whether such indebtedness
is absolute or
contingent, joint or several, matured or unmatured, direct or
indirect, and
whether such Obligor is liable to such Lender for such indebtedness
as
principal, surety, endorser, guarantor or otherwise. The term "Term
Loan Debt"
shall also include any other indebtedness, fees, liabilities and
obligations
owing to any Lender by any Obligor under the
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Term Loan Financing Agreement or any of the other Term Loan
Agreements, any
Obligor's liability to any Lender pursuant to the Term Loan
Financing Agreement
as maker or endorser of any promissory note or other instrument for
the payment
of money, any Obligor's liability to any Lender pursuant to the
Term Loan
Financing Agreement or any of the Term Loan Agreements or under any
instrument
of guaranty or indemnity, or arising under any guaranty,
endorsement or
undertaking that any Lender may make or issue to others for any
such Obligor's
account pursuant to the Term Loan Financing Agreement; subject,
however, in
respect of all of the foregoing, to the Term Loan Debt Cap.
1.42 "Term Loan Debt Cap" shall mean an aggregate principal amount
of
Term Loan Debt equal to Fifteen Million Dollars ($15,000,000); less
all
repayments (including mandatory and voluntary prepayments) of Term
Loan Debt
made subsequent to the Effective Date.
1.43 "Term Loan Default" shall mean an Event of Default under the
Term
Loan Financing Agreement.
1.44 "Term Loan Financing Agreement" shall mean the Loan and
Security
Agreement, dated as of the Effective Date, among Borrowers, Term
Loan Agent and
Term Loan Lenders, as the same now exists or may hereafter be
amended, modified,
supplemented, extended, renewed or restated.
1.45 "Term Loan Lenders" shall mean the "Lenders" (as defined in
the
Term Loan Financing Agreement) and any other lender or group of
lenders that at
any time succeeds to or refinances, replaces or substitutes for all
or any
portion of the Term Loan Debt at any time and from time to
time.
1.46 "Term Loan Priority Collateral" shall mean all Term Loan
Collateral, except that portion thereof consisting of any Working
Capital
Priority Collateral. Without limitation of the foregoing, for
avoidance of any
doubt, "Term Loan Priority Collateral" shall extend to and include:
(i) all Real
Property, (ii) all Contracts and General Intangibles of each
Obligor (including
Software) pertaining to Real Property, (iii) all Accounts, Chattel
Paper and
Instruments constituting Proceeds of Real Property, to the extent
thereof; (iv)
all Investment Property of each Obligor containing Proceeds of Real
Property,
(v) all Deposit Accounts of each Obligor containing Proceeds of
Real Property,
to the extent thereof; (vi) all money, cash or cash equivalents of
each Obligor
and all tort claims, insurance claims and the rights to payment of
each Obligor
now owned or hereafter acquired by any Obligor or in which any
Obligor now has
or hereafter acquires any rights constituting Proceeds of Real
Property; (vii)
any and all Commercial Tort Claims of each Obligor pertaining to
any Term Loan
Priority Collateral; and (viii) to the extent not otherwise
included, all
Proceeds of each of the foregoing, including insurance Proceeds,
and, all
accessions to, substitutions and replacements for, and rents,
profits and
products of each of the foregoing, and all books and records
relating to each of
the foregoing.
1.47 "Term Loan Termination Date" shall mean the date that Term
Loan
Agent and Term Loan Lenders have received payment in full of all of
the Term
Loan Debt.
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1.48 "UCC" or "Uniform Commercial Code" shall mean the Uniform
Commercial Code as the same may, from time to time, be in effect in
the State of
New York; provided, however, that to the extent that the UCC is
used to define
any term herein or in any other Credit Document and such term is
defined
differently in different Articles or Divisions of the UCC, the
definition of
such term contained in Article or Division 9 shall govern;
provided, further,
however, in the event that, by reason of mandatory provisions of
law, any or all
of the attachment, perfection or priority of a Lender's security
interest in any
Collateral is governed by the Uniform Commercial Code as in effect
in a
jurisdiction other than the State of New York, the term "UCC" shall
mean the
Uniform Commercial Code as in effect in such other jurisdiction for
purposes of
the provisions hereof relating to such attachment, perfection or
priority and
for purposes of definitions related to such provisions.
1.49 "UCC Terms" shall mean all terms defined in the Uniform
Commercial Code of the State of New York, which, unless otherwise
expressly
defined herein, shall have the meanings set forth therein.
1.50 "Working Capital Agent" shall mean CAPITALSOURCE FINANCE LLC,
a
Delaware limited liability company, in its capacity as Agent
pursuant to the
Working Capital Credit Agreement for the benefit and on behalf of
Working
Capital Lenders, and its successors and assigns (and including,
without
limitation, any successor, assignee or additional Person at any
time acting as
administrative agent for the benefit of or on behalf of it and/or
Working
Capital Lenders).
1.51 "Working Capital Collateral" shall mean and include all
assets
and properties of any kind whatsoever, real or personal, tangible
or intangible,
wherever located, of Borrowers or any Obligor, in which a Lien is
now or
hereafter granted, obtained or otherwise claimed by Working Capital
Agent or any
Working Capital Lender to secure payment of any Working Capital
Debt.
1.52 "Working Capital Credit Agreement" shall mean the Credit
and
Security Agreement, dated as of the Effective Date, among
Borrowers, Working
Capital Agent and Working Capital Lenders, as the same now exists
or as may
hereafter be amended, modified, supplemented, extended, renewed or
restated.
1.53 "Working Capital Debt" shall mean all loans and advances
or
extensions of credit made or to be made by any Lender to any
Obligor, or to
others for any Obligor's account, in each case, pursuant to the
terms and
provisions of the Working Capital Credit Agreement or any of the
Working Capital
Loan Agreements together with interest thereon (including interest
that would be
payable as post-petition interest in connection with any Insolvency
Proceeding)
and, including, without limitation, any reimbursement obligation or
indemnity of
the Obligors on account of "Letters of Credit," and all
indebtedness, fees,
liabilities and obligations that may at any time be owing by any
Obligor to any
Lender, in each case pursuant to the Working Capital Credit
Agreement or any
other Working Capital Loan Agreement, whether now in existence or
incurred by
any Obligor from time to time hereafter, whether unsecured or
secured by a
pledge of, Lien upon or security interest in any of any Obligor's
assets or
property or the assets or property of any other Person, whether
such
indebtedness is absolute or contingent, joint or several, matured
or unmatured,
direct or indirect
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and whether such Obligor is liable to such Lender for such
indebtedness as
principal, surety, endorser, guarantor or otherwise. The term
"Working Capital
Debt" shall also include any other indebtedness, fees, liabilities
and
obligations owing to any Lender by any Obligor under the Working
Capital Credit
Agreement or any of the other Working Capital Loan Agreements, any
Obligor's
liability to any Lender pursuant to the Working Capital Credit
Agreement as
maker or endorser of any promissory note or other instrument for
the payment of
money, any Obligor's liability to any Lender pursuant to the
Working Capital
Credit Agreement or any other Working Capital Loan Agreement or
under any
instrument of guaranty or indemnity, or arising under any guaranty,
endorsement
or undertaking that any Lender may make or issue to others for any
such
Obligor's account pursuant to the Working Capital Credit Agreement
or any
Working Capital Loan Agreement, including any accommodation
extended with
respect to applications for Letters of Credit; subject, however, in
respect of
the foregoing, to the Working Capital Debt Cap. Quoted terms used
in this
definition, but not expressly defined herein, shall have the
meanings given to
such defined terms in the Working Capital Credit Agreement.
1.54 "Working Capital Debt Cap" shall mean an aggregate
outstanding
principal amount of Working Capital Debt equal to Thirty Four
Million Five
Hundred Thousand Dollars ($34,500,000), minus all repayments
(including
mandatory and voluntary prepayments) in respect of the "Equipment
Term Loan" (as
defined in the Working Capital Credit Agreement) made subsequent to
the
Effective Date minus all permanent reductions of the "Revolving
Credit
Commitments" (as defined in the Working Capital Credit Agreement)
made
subsequent to the Effective Date (other than reductions due to a
termination of
such Commitments at a time at which Working Capital Debt remains
outstanding).
1.55 "Working Capital Default" shall mean an Event of Default
under
the Working Capital Credit Agreement.
1.56 "Working Capital Lenders" shall mean the "Lenders," the
"Agent"
and the "Lender Parties" (as each such term is defined in the
Working Capital
Credit Agreement) and any other lender or group of lenders that at
any time
succeeds to or refinances, replaces or substitutes for all or any
portion of the
Working Capital Debt at any time and from time to time.
1.57 "Working Capital Loan Agreements" shall mean the Working
Capital
Credit Agreement and all agreements, documents and instruments at
any time
executed and/or delivered by Borrowers or any Obligor or any other
Person with,
to or in favor of Working Capital Agent or any Working Capital
Lender in
connection therewith or related thereto, as all of the foregoing
now exist or
may hereafter be amended, modified, supplemented, extended, renewed
or restated.
1.58 "Working Capital Loan Termination Date" shall mean the date
on
which Working Capital Agent and Working Capital Lenders shall have
received
payment in full of all Working Capital Debt.
1.59 "Working Capital Priority Collateral" shall mean,
collectively,
that portion of the Working Capital Collateral consisting of, and
limited to,
the following property and interests in property, whether now owned
or hereafter
acquired or existing and wherever located, of each Obligor:
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<PAGE>
(a) all Inventory of each Obligor;
(b) all Accounts of each Obligor, excluding any portion thereof
constituting Proceeds of Term Loan Priority Collateral;
(c) all Chattel Paper of each Obligor, excluding any portion
thereof constituting Proceeds of Term Loan Priority Collateral;
(d) all Contracts of each Obligor excluding any portion thereof
pertaining to Term Loan Priority Collateral, to the extent
thereof;
(e) all Documents of each Obligor;
(f) all Equipment and Goods of each Obligor;
(g) all General Intangibles of each Obligor (including, without
limitation, payment intangibles and Software) excluding any portion
thereof
pertaining to Term Loan Priority Collateral, to the extent
thereof;
(h) all Instruments of each Obligor, excluding any portion
thereof constituting Proceeds of Term Loan Priority Collateral, to
the extent
thereof;
(i) all Investment Property of each Obligor, excluding any
portion thereof containing Proceeds of Term Loan Priority
Collateral, to the
extent thereof;
(j) all Balances of each Obligor, excluding any portion thereof
constituting or containing, Proceeds of Term Loan Priority
Collateral, to the
extent thereof;
(k) to the extent not otherwise included (or excluded) pursuant
to clause (i), all Deposit Accounts of each Obligor and all
deposits therein,
excluding any portion thereof containing Proceeds of Term Loan
Priority
Collateral, to the extent thereof;
(l) all money, cash or cash equivalents of each Obligor and all
tort claims, insurance claims and the rights to payment of each
Obligor now
owned or hereafter acquired by an Obligor or in which any Obligor
now has or
hereafter acquires any rights, excluding any portion thereof
constituting
Proceeds of Term Loan Priority Collateral, to the extent
thereof;
(m) all
Supporting Obligations and Letter-of-Credit Rights of
each Obligor, excluding any portion thereof constituting Proceeds
of Term Loan
Priority Collateral, to the extent thereof;
(n) any and all Commercial Tort Claims of each Obligor,
excluding
any portion thereof pertaining to Term Loan Priority Collateral, to
the extent
thereof;
(o) to the extent not otherwise included, all Proceeds of each
of
the foregoing, including insurance Proceeds, and, all accessions
to,
substitutions and replacements
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for, and rents, profits and products of each of the foregoing, and
all books and
records relating to each of the foregoing.
2.
SECURITY
INTERESTS; PRIORITIES; REMEDIES.
2.1 Working Capital Agent hereby acknowledges that Term Loan
Agent,
acting for and on behalf of itself and the Term Loan Lenders, has
been granted,
or may be granted, Liens upon all of Collateral, including the
Working Capital
Priority Collateral, pursuant to the Term Loan Agreements to secure
the Term
Loan Debt; consents thereto; and waives any Working Capital Default
in regard
thereto. Term Loan Agent hereby acknowledges that Working Capital
Agent, acting
for and on behalf of itself and the Working Capital Lenders, has
been granted,
or may be granted, Liens upon all of the Collateral, including the
Term Loan
Priority Collateral, pursuant to the Working Capital Loan
Agreements to secure
the Working Capital Debt; consents thereto; and waives any Term
Loan Default in
regard thereto.
2.2
(a) Notwithstanding the order or time of attachment, or the
order, time or manner of perfection, or the order or time of filing
or
recordation of any document or instrument, or other method of
perfecting a Lien
in favor of each Lender in any Collateral, and notwithstanding any
conflicting
terms or conditions that may be contained in any of the Agreements,
the Liens
upon any Working Capital Priority Collateral of Working Capital
Agent and
Working Capital Lenders have and shall have priority over the Liens
upon any
Working Capital Priority Collateral of Term Loan Agent and Term
Loan Lenders and
such Liens of Term Loan Agent and Term Loan Lenders upon any
Working Capital
Priority Collateral are and shall be junior and subordinate to any
Liens of
Working Capital Agent and Working Capital Lenders upon the Working
Capital
Priority Collateral to the full extent of the Working Capital Debt
outstanding
from time to time.
(b) Notwithstanding the order or time of attachment, or the
order, time or manner of perfection, or the order or time of filing
or
recordation of any document or instrument, or other method of
perfecting a Lien
in favor of each Lender in any Collateral, and notwithstanding any
conflicting
terms or conditions that may be contained in any of the Agreements,
the Liens
upon any Term Loan Priority Collateral of Term Loan Agent and Term
Loan Lenders
have and shall have priority over the Liens upon any Term Loan
Priority
Collateral of Working Capital Agent and Working Capital Lenders to
the full
extent of the Term Loan A Debt outstanding from time to time and
such Liens of
Working Capital Agent and Working Capital Lenders upon any Term
Loan Priority
Collateral are and shall be junior and subordinate to any Liens of
Term Loan
Agent and Term Loan Lenders upon the Term Loan Priority Collateral
to the full
extent of the Term Loan A Debt outstanding from time to time.
2.3
(a) The relative priorities of the Liens provided in Section
2.2
shall not be altered or otherwise affected by any amendment,
modification,
supplement, extension, renewal, restatement, replacement or
refinancing of the
Working Capital Debt or the Term Loan
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<PAGE>
Debt, nor by any action or inaction that any of the Lenders may
take or fail to
take in respect of the Collateral.
(b) Working Capital Agent agrees not to enter into any
agreement
with another creditor of Borrowers or any Obligor to subordinate
its Lien in any
Working Capital Priority Collateral to the Lien of such other
creditor of
Borrowers or any Obligor in such Working Capital Priority
Collateral without the
prior written consent of Term Loan Agent.
(c) Term Loan Agent agrees not to enter into any agreement with
another creditor of Borrowers or any Obligor to subordinate its
Lien on any Term
Loan Priority Collateral to the Lien of such other creditor of
Borrowers or any
Obligor in such Term Loan Priority Collateral without the prior
written amount
of Working Capital Agent.
2.4
(a) Subject to Section 2.2 and Section 2.10, all proceeds of
the
Working Capital Priority Collateral received by the Term Loan Agent
or any Term
Loan Lender shall be forthwith paid over, in the funds and currency
received
(without interest), to Working Capital Agent for application to the
Working
Capital Debt (unless otherwise required by law); and any proceeds
of Working
Capital Priority Collateral received by Working Capital Agent or
any Working
Capital Lender after the Working Capital Loan Termination Date
shall be
forthwith paid over, in the funds and currency received, to Term
Loan Agent for
application to the Term Loan Debt (unless otherwise required by
law). For
purposes of this Section 2.4(a), payments made by any Obligor to
Term Loan Agent
or Term Loan Lenders in respect of the Term Loan Debt with proceeds
of loans by
Working Capital Agent or Working Capital Lenders to Borrowers shall
not be
construed to constitute proceeds of Working Capital Priority
Collateral.
(b) Subject to Section 2.2 and Section 2.10, all proceeds of
the
Term Loan Priority Collateral received by the Working Capital Agent
or any
Working Capital Lender shall be forthwith paid over, in the funds
and currency
received (without interest), to Term Loan Agent for application to
the Term Loan
Debt (unless otherwise required by law) until the Term Loan A
Repayment Date
shall have occurred; and all proceeds of Term Loan Priority
Collateral received
by the Term Loan Agent or any Term Loan Lender after the Term Loan
A Repayment
Date shall be forthwith paid over, in the funds and currency
received, to
Working Capital Agent for application to the Working Capital Debt
(unless
otherwise required by law) until the Working Capital Debt is paid
in full.
(c) Subject to Section 2.2 and Section 2.10, all proceeds of
Term
Loan Priority Collateral received by the Working Capital Agent or
any Working
Capital Lender after the Working Capital Loan Termination Date
shall be
forthwith paid over, in the funds and currency received, to Term
Loan Agent for
application to the remaining balance of the Term Loan Debt (unless
otherwise
required by law).
2.5 Except as provided in Section 4.6 of this Agreement, each
Lender
shall be solely responsible for perfecting and maintaining the
perfection of its
Lien in and to each item constituting the Collateral in which such
Lender has
been granted a Lien. The foregoing provisions of this Intercreditor
Agreement
are intended solely to govern the respective Lien
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<PAGE>
priorities as between the Lenders and shall not impose on any
Lender any
obligations in respect of the disposition of proceeds of any
Collateral that
would conflict with prior perfected claims therein in favor of any
other Person
or any order or decree of any court or governmental authority or
any applicable
law. Term Loan Agent agrees that it will not contest the validity,
perfection,
priority, enforceability or unavoidability of the Liens upon any
Working Capital
Priority Collateral of Working Capital Agent or any Working Capital
Lender; and
Working Capital Agent agrees that it will not contest the validity,
perfection,
priority, enforceability or unavoidability of the Liens upon any
Term Loan
Priority Collateral of Term Loan Agent or any Term Loan Lender.
2.6
(a) In the event that Working Capital Agent or any Working
Capital Lender shall, in the exercise of its rights under its
Agreements or
otherwise, receive possession or control of any books and records
of Borrowers
or any Obligor that contain information identifying or pertaining
to any Term
Loan Priority Collateral, Working Capital Agent shall notify Term
Loan Agent
that it has received such books and records and shall, as promptly
as
practicable thereafter, if requested to do so by Term Loan Agent
make available
to Term Loan Agent such books and records for inspection and
duplication.
(b) In the
event that Term Loan Agent or any Term Loan Lender
shall, in the exercise of its rights under its Agreements or
otherwise, receive
possession or control of any books and records of Borrowers or any
Obligor that
contain information identifying or pertaining to any Working
Capital Priority
Collateral, Term Loan Agent shall notify Working Capital Agent that
it has
received such books and records and shall, as promptly as
practicable
thereafter, if requested to do so by Working Capital Agent make
available to
Working Capital Agent such books and records for inspection and
duplication.
2.7 Subject to the terms and conditions set forth in this
Intercreditor Agreement, including, particularly, Section 2.10:
(a) Working Capital Agent and Working Capital Lenders shall
have
the exclusive right to manage, perform and enforce the terms of the
Working
Capital Loan Agreements with respect to the Working Capital
Priority Collateral,
to exercise and enforce all privileges and rights thereunder
according to their
discretion and the exercise of its business judgment, including,
without
limitation, the exclusive right to take or retake control or
possession
