EXHIBIT 4.11 INTERCREDITOR AGREEMENT

 

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                                                                    EXHIBIT 4.11

 

                             INTERCREDITOR AGREEMENT

 

            THIS INTERCREDITOR AGREEMENT dated as of March 20, 2003 (as

modified, amended, restated or supplemented from time to time, this

"AGREEMENT"), by and among:

 

            (1) U.S. Bank National Association, in its capacity as the

collateral agent under the Collateral Agency and Intercreditor Agreement

described below (the "COLLATERAL AGENT");

 

            (2) Castle SPFD, LLC, a Delaware limited liability company (the

"SPE");

 

            (3) A. M. Castle & Co., a Maryland corporation ("CASTLE"), Total

Plastics, Inc., a Michigan corporation ("TOTAL PLASTICS"), Oliver Steel Plate

Co., a Delaware corporation ("OLIVER"), and Keystone Tube Company, LLC, a

Delaware limited liability company ("KEYSTONE"; and together with Castle, Total

Plastics and Oliver, each, a "COMPANY" and collectively, the "COMPANIES");

 

            (4) Massachusetts Mutual Life Insurance Company, Allstate Life

Insurance Company, Nationwide Life Insurance Company, The Northwestern Mutual

Life Insurance Company, United of Omaha Life Insurance Company, Mutual of Omaha

Life Insurance Company, Bank of America, N.A. and The Northern Trust Company

(collectively, the "EXISTING LENDERS")

 

            (5) Castle IND MGR, Inc. (the "INDEPENDENT MEMBER"); and

 

            (6) General Electric Capital Corporation, a Delaware corporation

("GE CAPITAL"), acting in its capacity as administrative agent for the Purchaser

under the Purchase Agreement (in such capacity, together with its successors and

assigns, the "RECEIVABLES AGENT").

 

                                R E C I T A L S:

 

            A. The Companies and the SPE are parties to that certain Receivables

Sale and Contribution Agreement, dated as of December 26, 2002 (as amended,

supplemented, restated or otherwise modified from time to time, the "SALE

AGREEMENT"), pursuant to which each of the Companies has agreed to sell and/or

contribute to the SPE, and the SPE has agreed to purchase and accept from such

Company, all of the right, title and interest of such Company in all of its

Receivables and the Related Security (each as hereinafter defined).

 

            B. Castle, as master servicer, Total Plastics, as servicer, Oliver,

as servicer, the SPE, Castle IND MGR, Inc., a Delaware corporation (the

"INDEPENDENT MEMBER"), and GE Capital, as purchaser and the Receivables Agent,

are parties to that certain Receivables Purchase

 

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and Servicing Agreement, dated as of December 26, 2002 (as amended,

supplemented, restated or otherwise modified from time to time, the "PURCHASE

AGREEMENT"), pursuant to which GE Capital has agreed to purchase interests in

the Receivables and Related Security sold and contributed to the SPE pursuant to

the Sale Agreement.

 

            C. Pursuant to (i) the Reimbursement Agreement, dated as of June 1,

1994 by Castle in favor of NBD Bank, N.A., as assigned and amended pursuant to

the terms of an Assignment and Amendment of Reimbursement Agreement, dated as of

June 12, 2001, by and among Castle, Bank One, NA (successor to NBD Bank, N.A.)

and Bank of America, N.A. ("BOFA"), as further amended by the Second Amendment

to Reimbursement Agreement dated November 22, 2002, the Third Amendment to

Reimbursement Agreement dated December 26, 2002 and the Fourth Amendment to

Reimbursement Agreement dated March 20, 2002 and the related documents

(collectively, as may be amended, supplemented, restated or otherwise modified

from time to time, the "JUNE 1994 REIMBURSEMENT Agreement"), (ii) the

Reimbursement Agreement, dated as of November 1, 1994 by Castle in favor of NBD

Bank, N.A., as assigned and amended pursuant to the terms of an Assignment and

Amendment of Reimbursement Agreement, dated as of November 1, 2001, by and among

Castle, Bank One, NA (successor to NBD Bank, N.A.), as further amended by the

Second Amendment to Reimbursement Agreement dated as of November 1, 2001, the

Third Amendment to Reimbursement Agreement dated as of November 22, 2002, the

Fourth Amendment to Reimbursement Agreement dated as of December 26, 2002 and

the Fifth Amendment to Reimbursement Agreement dated March 20, 2003 and the

related documents (collectively, as may be amended, supplemented, restated or

otherwise modified from time to time, the "NOVEMBER 1994 REIMBURSEMENT

AGREEMENT"), and (iii) the Application and Agreement for Standby Letter of

Credit dated as of March 5, 2002 and the related documents (collectively, as may

be amended, supplemented, restated or otherwise modified from time to time, the

"MARCH 2002 AGREEMENT"; and, together with the June 1994 Reimbursement Agreement

and the November 1994 Reimbursement Agreement, the "REIMBURSEMENT AGREEMENTS"),

BofA has issued letters of credit (u) pursuant to which up to a maximum amount

of $611,337 may be drawn at any one time to secure payments due in connection

with certain State of Ohio, Industrial Development Refinancing Revenue Bonds

(A.M. Castle & Co. Project) Series 1994 issued to provide financing to the

Company, (v) pursuant to which up to a maximum amount of $1,008,188 may be drawn

at any one time to secure payments due in connection with certain The Industrial

Development Authority of the City of Kansas City, Missouri, Industrial

Development Refunding Revenue Bonds (A.M. Castle & Co. Project) Series 1994

issued to provide financing to the Company, (w) pursuant to which up to a

maximum of $672,544 may be drawn at any one time in connection with certain

Village of Franklin Park, Illinois Industrial Development Refunding Revenue

Bonds (A.M. Castle & Co. Project) Series 1994 issued to provide financing to the

Company; (x) pursuant to which up to a maximum of $194,281 may be drawn at any

one time to secure payments due in connection with certain Village of Rosemont,

Illinois Industrial Development Refunding Revenue Bonds (A.M. Castle & Co.

Project) Series 1994 issued to provide financing to the Company; (y) pursuant to

which up to a maximum of $3,762,740 may be drawn at any one time to secure

payments due in connection with certain City of Hammond, Indiana Adjustable Rate

Economic Development Revenue Bonds (A.M. Castle & Co. Project) Series 1994

issued to provide financing to the Company and (z) pursuant to which up to

$5,000,000 may be drawn to secure payments due from Kreher Steel Company LLC

("KREHER") in connection with a certain Amended and Restated Credit Agreement,

dated as of March 8,

 

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2002 (as from time to time amended or modified) between Kreher and BofA, as

Agent (the items described in clauses (u) - (z) are herein collectively, as may

be amended, supplemented, restated or otherwise modified from time to time,

referred to as the "BOFA LETTERS OF CREDIT").

 

            D. Pursuant to (i) the Guarantee Agreement dated as of November 22,

2002 by Castle in favor of BofA, Castle guaranteed to BofA (a) the payment by

the City of LaPorte, Indiana (the "KEYSTONE ISSUER") of all principal interest

and any other amounts payable by the Keystone Issuer in respect of the Keystone

Issuer's Economic Development Revenue Bonds, Series 1998 (Keystone Services,

Inc. Project) (the "LAPORTE BONDS"), and (b) the payment and performance by

Keystone Service, Inc. of all of its covenants, agreements, obligations and

liabilities under that certain Loan Agreement, dated as of April 1, 1998,

between the Keystone Issuer and Keystone Service, Inc. and (ii) the Guarantee

Agreement dated as of November 22, 2002 by Castle in favor of BofA Castle

guaranteed the payment to BofA by The Mecklenburg County Industrial Facilities

and Pollution Control Financing Authority (the "MECKLENBURG ISSUER") of all

principal, interest and other amounts payable by the Mecklenburg Issuer in

respect to the Mecklenburg Issuer's Tax-Exempt Industrial Revenue Bonds (A.M.

Castle & Co. Project) Series 1996 (the "MECKLENBURG BONDS"); the obligation of

Castle under each of said Guarantee Agreements are herein collectively, as may

be amended, supplemented, restated or otherwise modified from time to time,

referred to as the "IRB BOND GUARANTY OBLIGATIONS" and each such Guarantee

Agreement, as may be amended, supplemented, restated or otherwise modified from

time to time, is herein referred to as an "IRB BOND GUARANTEE").

 

            E. Pursuant to the Trade Acceptance Purchase Agreement dated as of

August 13, 2001 between Castle and The Northern Trust Company ("NORTHERN

TRUST"), as amended by the First Amendment thereto dated as of April 29, 2002,

the Second Amendment thereto dated as of June 30, 2002, the Third Amendment

thereto dated as of November 22, 2002, the Fourth Amendment thereto dated

December 26, 2002 and the Fifth Amendment thereto dated March 20, 2003

(collectively, as may be amended, supplemented, restated or otherwise modified

from time to time, the "TRADE ACCEPTANCE PURCHASE AGREEMENT"), Northern Trust

agreed to purchase certain Trade Acceptances (as defined therein) from Castle

from time to time.

 

            F. Pursuant to (i) the Note Agreement dated as of April 1, 1996

between Castle and Nationwide Life Insurance Company, as amended by the First

Amendment and Waiver to Note Agreement dated as of December 1, 1998, the Second

Amendment to Note Agreement dated November 22, 2002, the Third Amendment to Note

Agreement dated as of December 26, 2002 and the Fourth Amendment to Note

Agreement dated as of March 20, 2003, (ii) the Note Agreement dated as of May

15, 1997 among Castle, Massachusetts Mutual Life Insurance Company and United of

Omaha Life Insurance Company, as amended by the First Amendment and Waiver to

Note Agreement, dated as of December 1, 1998, the Second Amendment to Note

Agreement dated November 22, 2002, the Third Amendment to Note Agreement dated

as of December 26, 2002 and the Fourth Amendment to Note Agreement dated as of

March 20, 2003, and (iii) the Note Agreement, dated as of March 1, 1998, among

Castle, Allstate Life Insurance Company, The The Northwestern Mutual Life

Insurance Company, Massachusetts Mutual Life Insurance Company, Mutual of Omaha

Insurance Company and United of Omaha Life Insurance Company, as amended by the

First Amendment and Waiver to Note Agreement, dated as of December 1, 1998, the

Second Amendment to Note Agreement dated November 22, 2002, the Third Amendment

to Note Agreement dated as of December 26,

 

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2002 and the Fourth Amendment to Note Agreement dated as of March 20, 2003

(collectively, as may be amended, supplemented, restated or otherwise modified

from time to time, the "NOTE AGREEMENTS"), Castle issued various series of

senior notes (collectively, as may be amended, supplemented, restated or

otherwise modified from time to time, the "SENIOR NOTES") to the other parties

to the Note Agreements (each of such other parties, a "NOTEHOLDER" and

collectively, the "NOTEHOLDERS").

 

            G. To secure their obligations to the Existing lenders (all of the

foregoing and their permitted successors and assigns under Section 3.3 hereof,

collectively, the "LENDERS") under the Loan Documents (hereinafter defined),

Castle and certain of its Subsidiaries (other than the SPE and the Independent

Member) have granted to the Collateral Agent, for the benefit of the Lenders,

liens on, among other things, Lender Collateral.

 

            H. The parties hereto wish to set forth certain agreements with

respect to the Receivables Assets (as hereinafter defined) and with respect to

the Lender Collateral (as hereinafter defined).

 

            NOW, THEREFORE, in consideration of the foregoing premises and the

mutual covenants contained herein, and for other good and valuable

consideration, receipt of which is hereby acknowledged, it is hereby agreed as

follows:

 

                             ARTICLE 1. DEFINITIONS

 

      1.1.  Certain Defined Terms. As used in this Agreement, the following

terms shall have the following meanings (such meanings to be equally applicable

to both the singular and plural forms of the terms defined):

 

            "ACCOUNT COLLATERAL" has the meaning assigned to it in clause (f) of

the definition of the term "Related Security".

 

            "BANKRUPTCY CODE" means the provisions of title 11 of the United

States Code, 11 U.S.C. Sections 101 et seq.

 

            "BILLING DATE" means, with respect to any Receivable or Unsold

Receivable, as the case may be, the date on which the invoice with respect

thereto was generated and billed to the Obligor.

 

            "BUSINESS DAY" means any day that is not a Saturday, a Sunday or a

day on which banks are required or permitted to be closed in any of the States

of Illinois or New York.

 

            "CLAIM" means the Lender Claim or the Receivables Claim, as

applicable.

 

            "COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT" means the Collateral

Agency and Intercreditor Agreement, dated as of March 20, 2003, among the

Collateral Agent, BofA, the Noteholders, Northern Trust, the Guarantors (as

defined therein) and any holders of Additional Future Debt (as defined therein),

as may be amended, supplemented, restated or otherwise modified from time to

time.

 

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            "COLLECTION ACCOUNT" means Deutsche Bank Trust Company Americas, New

York, New York, ABA No. 021 001 033, Account No. 502 328 54, Account Name: GE

Capital/CAF Depository, Reference: A. M. Castle CFN 4963, or any successor

collection account, established by the Receivables Agent under the Purchase

Agreement.

 

            "COLLECTIONS" means, with respect to any Receivable, all cash

collections and other proceeds of such Receivable, including, without

limitation, all late charges, fees and interest arising thereon, all recoveries

with respect to any such Receivable that has been written off as uncollectible,

and any payments (whether by a scrap mill, any Company or any other Person) with

respect to Returned Goods or Scrapped Goods, BUT EXCLUDING, HOWEVER, in respect

of the Transferred Receivables, any purchase price paid to the Companies by the

SPE with respect to and as consideration for the sale of the Transferred

Receivables by any of the Companies to the SPE.

 

            "CONCENTRATION ACCOUNT" means that certain concentration account

listed on Schedule 4.01(r), as amended, to the Purchase Agreement established in

the name of the SPE and held at the Concentration Account Bank.

 

            "CONCENTRATION ACCOUNT BANK" means any bank or other financial

institution at which the Concentration Account is maintained.

 

            "CONTRACT" means any of the Receivables Contracts or the Unsold

Receivables Contracts.

 

            "CONTRIBUTED RECEIVABLE" means a Receivable and Related Security

contributed to SPE as capital contribution under the Sale Agreement.

 

            "DEPOSIT INVESTMENTS" means, with respect to any Account Collateral,

the certificates, instruments, investment property or other investments in which

amounts constituting such collateral are invested from time to time.

 

            "DESIGNATED DISTRICT" means a District which has been designated in

writing by the Receivables Agent to the Companies pursuant to the provisions of

the Related Documents as giving rise to Designated Receivables.

 

            "DESIGNATED RECEIVABLE" means any indebtedness of Obligors (whether

constituting an account, a payment intangible, an instrument or otherwise)

arising from the sale of merchandise, goods or services by any District of any

Company to its Obligors (including the right to payment of any interest or

finance charges and other obligations of such Obligors with respect thereto)

designated in writing by the Receivables Agent to the Companies pursuant to the

provisions of the Related Documents at any time that the aggregate principal

amount of Transferred Receivables at any one time outstanding exceeds

$75,000,000 and arising after the date of such written designation.

 

            "DISPOSITION" means any liquidation of Castle or any of its

Subsidiaries or their assets, the establishment of any receivership for Castle

or any of its Subsidiaries or their assets, a bankruptcy proceeding (either

voluntary or involuntary) of Castle or any of its Subsidiaries, the payment of

any insurance, condemnation, confiscation, seizure or other claim upon the

 

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condemnation, confiscation, seizure, loss or destruction of, or damage to, or

any other sale, transfer, assignment or other disposition of assets of Castle or

any of its Subsidiaries (other than the sale, contribution and transfer of

interests in the Receivables Assets pursuant to the Sale Agreement and the

Purchase Agreement).

 

            "DISTRICT" means the geographic location of the office of the

Company which generates a Contract with respect to any Receivable or Unsold

Receivable.

 

            "ENFORCEMENT" means, collectively or individually, (a) any

declaration by the Receivables Agent or the Purchaser or automatic occurrence of

the Facility Termination Date as a result of the occurrence of a Termination

Event under the Related Documents; or (b) the Collateral Agent or any of the

Lenders, after the occurrence and during the continuance of a Loan Event of

Default, (i) demands payment in full of or accelerates or requires cash

collateral for the indebtedness of Castle and its Subsidiaries (other than the

SPE and the Independent Member) to the Lenders under the Loan Documents or (ii)

commences the judicial or nonjudicial enforcement of any of the default rights

and remedies against Castle or its Subsidiaries (other than the SPE and the

Independent Member) or any of their respective assets under the Loan Documents

or applicable law.

 

            "ENFORCEMENT NOTICE" means a written notice delivered in accordance

with Section 2.4 hereof which notice shall (a) if delivered by the Receivables

Agent, state that the Facility Termination Date has occurred, specify the nature

of the Termination Event that has caused the declaration of such Facility

Termination Date, and state that an Enforcement Period has commenced and (b) if

delivered by the Collateral Agent, state that a Loan Event of Default has

occurred and that the payment in full of or cash collateral for the Lender Claim

has been demanded or the indebtedness of Castle or its Subsidiaries (other than

the SPE and the Independent Member) to any of the Lenders has been accelerated,

specify the nature of the Loan Event of Default that caused such demand or

acceleration, and state that an Enforcement Period has commenced.

 

            "ENFORCEMENT PERIOD" means the period of time following the receipt

by either (a) the Collateral Agent, on behalf of the Lenders, or (b) the

Receivables Agent of an Enforcement Notice delivered by the other until the

earliest of the following: (i) the Receivables Claim has been satisfied in full,

the Purchaser and the Receivables Agent have no further obligations under the

Related Documents and the Related Documents have been terminated; (ii) the

Lender Claim has been satisfied in full, the Lenders have no further obligations

under the Loan Documents and the Loan Documents have been terminated; and (iii)

the parties hereto agree in writing to terminate the Enforcement Period.

 

            "FACILITY TERMINATION DATE" means the earliest of (a) the date so

designated pursuant to the Purchase Agreement, (b) December 26, 2005, and (c)

the date of termination of the Maximum Purchase Limit specified in a notice from

the SPE to the Purchaser delivered pursuant to the Purchase Agreement.

 

            "GOVERNMENTAL AUTHORITY" means any nation or government, any state

or other political subdivision thereof, and any agency, department or other

entity exercising executive, legislative, judicial, regulatory or administrative

functions of or pertaining to government.

 

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            "JOINDER AGREEMENT" means the Joinder Agreement in the form of

Exhibit C attached hereto.

 

            "LENDER CLAIM" means all of the indebtedness, obligations and other

liabilities of Castle or its Subsidiaries (other than the SPE and the

Independent Member) now or hereafter arising under, or in connection with the

Loan Documents, including, but not limited to, all reimbursement obligations of

Castle with respect to any loans made or any letters of credit issued

thereunder, all guarantee obligations of Castle's Subsidiaries (other than the

SPE and the Independent Member) under the Loan Documents, any interest thereon

(including, without limitation, interest accruing after the commencement of a

bankruptcy, insolvency or similar proceeding relating to any of Castle or its

Subsidiaries (other than the SPE and the Independent Member), whether or not

such interest is an allowed claim in any such proceeding), any reimbursement

obligations, premiums, make-whole amounts, yield maintenance amounts, fees or

expenses due thereunder, and any costs of collection or enforcement.

 

            "LENDER COLLATERAL" means all property and interests in property now

owned or hereafter acquired or created, of Castle or any of its Subsidiaries

(other than the SPE and the Independent Member) in or upon which a Lender

Interest is granted or purported to be granted by any such Person to any of the

Lenders under any of the Loan Documents, EXCLUDING, HOWEVER, the Receivables

Assets, the Returned Goods or Scrapped Goods the original sale of which gave

rise to a Transferred Receivable (except as otherwise set forth in Section

2.1(a)) hereof, BUT INCLUDING Returned Goods or Scrapped Goods in or on which

the Lender Interest is junior, subordinated and subject to the Receivables

Interest pursuant to Section 2.1(a) hereof.

 

            "LENDER INTEREST" means, with respect to any property or interest in

property (including, without limitation, the Lender Collateral), now owned or

hereafter acquired or created, of Castle or any of its Subsidiaries (other than

the SPE and the Independent Member), any lien, claim, encumbrance, security

interest, voting right, right of offset (whether contractual or arising at

common law) or other interest of the Collateral Agent (for the benefit of itself

and the Lenders) or any Lender in such property or interests in or to such

property.

 

            "LIEN" means any mortgage or deed of trust, pledge, hypothecation,

assignment, deposit arrangement, lien, charge, claim, security interest,

easement or encumbrance, or preference, priority or other security agreement or

preferential arrangement of any kind or nature whatsoever (including any lease

or title retention agreement, any financing lease having substantially the same

economic effect as any of the foregoing, and the filing of, or agreement to

give, any financing statement perfecting a security interest under the UCC or

comparable law of any jurisdiction).

 

            "LOAN DOCUMENTS" means the Collateral Agency and Intercreditor

Agreement, the Reimbursement Agreements, the Trade Acceptance Purchase

Agreement, the Note Agreements, the IRB Bond Guarantees, any Additional Future

Debt Documents (as defined in the Collateral Agency and Intercreditor

Agreement), the following collateral documents, each dated as of March 20, 2003:

the Security Agreement between the Collateral Agent and the Obligors, the Stock

Pledge Agreement between the Collateral Agent and Castle, the Trademark

Collateral Security and Pledge Agreement among the Collateral Agent, Castle and

Total Plastics, the Environmental Indemnity Agreement between the Obligors and

the Collateral Agent, Deed

 

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of Trust, Security Agreement, Financing Statement and Assignment of Rents and

Leases between Castle and the Collateral Agent (Charlotte, NC), the Open-End

Mortgage, Security Agreement, Financing Statement and Assignment of Rents and

Leases between Castle and the Collateral Agent (Bedford Heights, OH), the Deed

of Trust, Security Agreement, Financing Statement and Assignment of Rents and

Leases between the Company and the Collateral Agent (Grand Prairie, TX), the

Mortgage, Security Agreement, Financing Statement and Assignment of Rents and

Leases between Keystone and the Collateral Agent (Franklin Park, IL), the Deed

of Trust, Security Agreement, Financing Statement and Assignment of Rents and

Leases between Castle and the Collateral Agent (Houston, TX), the Deed of Trust,

Security Agreement, Financing Statement and Assignment of Rents and Leases

between Castle and the Collateral Agent (Kansas City, MO), the Deed of Trust,

Security Agreement, Financing Statement and Assignment of Rents and Leases

between Kestone and the Collateral Agent (Paramount, CA), the Mortgage, Security

Agreement, Financing Statement and Assignment of Rents and Leases between the

Company and the Collateral Agent (Blaine, MN), the Open-End Mortgage, Security

Agreement, Financing Statement and Assignment of Rents and Leases between

Castle, Mortgage, Security Agreement, Financing Statement and Assignment of

Rents and Leases between Castle and the Collateral Agent (Worcester, MA) and the

Collateral Agent (Fairless Hills, PA) and Mortgage, Security Agreement,

Financing Statement and Assignment of Rents and Leases between Total Plastics

and the Collateral Agent (Grand Rapids, MI), and all related documents executed

pursuant to any of the foregoing, in each case, as may be amended, supplemented,

restated or otherwise modified from time to time. For the purposes of this

definition of the term "Loan Documents", "Obligors" means Castle, Datamet, Inc.,

an Illinois corporation, Keystone, Total Plastics, Paramont Machine Company,

LLC, a Delaware limited liability company, Advanced Fabricating Technology, LLC,

a Delaware limited liability company, Oliver, and Metal Mart, LLC, a Delaware

limited liability company.

 

            "LOAN EVENT OF DEFAULT" has the meaning ascribed to the term "Event

of Default" under and as defined in any of the Reimbursement Agreements, the IRB

Bond Guarantees, the Trade Acceptance Purchase Agreement, any of the Note

Agreements or any Additional Future Debt Documents (as defined in the Collateral

Agency and Intercreditor Agreement).

 

            "LOCKBOX" has the meaning ascribed to it in Section 6.01(a)(ii) of

the Purchase Agreement.

 

            "LOCKBOX ACCOUNT" means each lockbox account or blocked account

(including blocked accounts consisting of deposit accounts and concentration

accounts) listed on Schedule 4.01(r) to the Purchase Agreement as amended from

time to time established in the name of the SPE and held at a Lockbox Account

Bank, together with any other segregated deposit account established by the SPE

for the deposit of Collections pursuant to and in accordance with the Purchase

Agreement.

 

            "LOCKBOX ACCOUNT BANK" means any bank or other financial institution

at which one or more Lockbox Accounts are maintained.

 

            "LOCKBOX ACCOUNT AGREEMENT" means any agreement among any one or

more Companies, the SPE, the Receivables Agent, a Lockbox Account Bank and/or

Concentration

 

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Account Bank with respect to a Lockbox, Lockbox Account and/or Concentration

Account that provides, among other things, that (a) all items of payment

deposited in such Lockbox, Lockbox Account or Concentration Account are held by

such Lockbox Account Bank or such Concentration Account Bank, as the case may

be, as custodian for GE Capital, as Receivables Agent, (b) neither the Lockbox

Account Bank nor the Concentration Account Bank, as applicable, has any rights

of setoff or recoupment or any other claim against such Lockbox Account or

Concentration Account, as the case may be, other than for payment of its service

fees and other charges directly related to the administration of such Account

and for returned checks or other items of payment and (c) such Lockbox Account

Bank agrees to forward all Collections received in such Lockbox Account to the

Concentration Account within one Business Day of receipt of available funds, and

such Concentration Account Bank agrees to forward all Collections received in

the Concentration Account to the Collection Account within one Business Day of

receipt of available funds, and is otherwise in form and substance acceptable to

the Receivables Agent.

 

            "MAXIMUM PURCHASE LIMIT" means $60,000,000 as such amount may be

reduced in accordance with Section 2.02(a) of the Purchase Agreement.

 

            "OBLIGOR" means, with respect to any Receivable, the Person

primarily obligated to make payments in respect thereof.

 

            "OUTSTANDING BALANCE" means, with respect to any Receivable and as

of any date of determination, the amount (which amount shall not be less than

zero) equal to (a) the amount billed to the Obligor thereof, minus (b) all

Collections received from the Obligor thereunder, minus (c) all discounts to or

any other modifications that reduce such amount billed to the Obligor; PROVIDED

THAT if the Receivables Agent or any of the Companies makes a determination that

all payments by such Obligor with respect to such amount billed have been made,

the Outstanding Balance shall be zero.

 

            "PERSON" means any individual, sole proprietorship, partnership,

joint venture, unincorporated organization, trust, association, corporation

(including a business trust), limited liability company, institution, public

benefit corporation, joint stock company, Governmental Authority or any other

entity of whatever nature.

 

            "PURCHASER" means GE Capital and its assigns under the Purchase

Agreement.

 

            "RECEIVABLE" means, with respect to any Obligor, indebtedness of

such Obligor (whether constituting an account, a payment intangible, an

instrument or otherwise) arising from the sale of merchandise, goods or services

by a Company to such Obligor, including the right to payment of any interest or

finance charges and other obligations of such Obligor with respect thereto;

PROVIDED THAT the definition of "Receivable" shall exclude the Designated

Receivables.

 

            "RECEIVABLES ASSETS" means the Transferred Receivables and Related

Security (exclusive of any Collections or other monies deposited in the

Collection Account, any Lockbox Account or the Concentration Account which are

not Collections related to Transferred Receivables, and, for the avoidance of

doubt, exclusive of Unsold Receivables).

 

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            "RECEIVABLES CONTRACT" means any agreement (including any invoice,

draft or promissory note) pursuant to, or under which, an Obligor shall be

obligated to make payments with respect to any Receivable.

 

            "RECEIVABLES CLAIM" means (a) all indebtedness, obligations and

other liabilities of the SPE to the Receivables Agent and the Purchaser and (b)

until and unless all of the obligations to the Receivables Agent or any

Purchaser arising under or in connection with the Related Documents have been

fully performed and indefeasibly paid in full in cash to the Receivables Agent,

all indebtedness, obligations and other liabilities of (i) any of the Companies

now or hereafter arising under, or in connection with, any of the Related

Documents or (ii) any of the Companies to the SPE now or hereafter arising

under, or in connection with, the Related Documents, including, but not limited

to, all sums or advances now made to or for the benefit of the SPE under the

Purchase Agreement, any yield or interest thereon (including, without

limitation, interest or yield accruing after the commencement of a bankruptcy,

insolvency or similar proceeding relating to any of the Companies or the SPE,

whether or not such interest or yield is an allowed claim in any such

proceeding), any repayment obligations, fees or expenses due thereunder, and any

costs of collection or enforcement.

 

            "RECEIVABLES INTEREST" means, with respect to any of the Receivables

Assets or any property or interest in property, any lien, claim, encumbrance,

security interest or other interest of any or all of the SPE, the Purchaser

and/or the Receivables Agent in or to any of such property.

 

            "RECORDS" means all Receivables Contracts and other documents,

books, records and other information (including computer programs, tapes, disks,

data processing software and related property and rights) prepared and

maintained by any Company, any Sub-Servicers or the SPE with respect to the

Receivables Assets and the Obligors thereunder.

 

            "RELATED DOCUMENTS" means the Sale Agreement, the Purchase

Agreement, each as amended from time to time, and any other agreements,

instruments or documents (other than this Agreement) executed by (a) any or all

of the Companies and delivered to the SPE or (b) the SPE and delivered to the

Receivables Agent or the Purchaser.

 

            "RELATED SECURITY" means with respect to any Receivable:

 

            (a) all supporting obligations (as defined in Article 9 of the UCC),

security interests or Liens and property subject thereto from time to time

securing or purporting to secure the payment of such Receivable by the Person

obligated thereon;

 

            (b) all guaranties, indemnities and warranties, insurance policies,

financing statements and other agreements or arrangements of whatever character

from time to time supporting or securing payment of such Receivable;

 

            (c) all right, title and interest of Castle or any Subsidiary in and

to any goods (including Returned Goods) the sale of which gave rise to such

Receivable and all right, title and interest of Castle or any Subsidiary in and

to payments made on account of Scrapped Goods; PROVIDED THAT Related Security

will not include Returned Goods from and after the time, if any, when the SPE

shall have received full cash payment required to be made under the Sale

 

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Agreement on account of the reduction of the Outstanding Balance of the

Receivable related to such Returned Good;

 

            (d) all Collections;

 

            (e) all Records;

 

            (f) all of the following (collectively, the "ACCOUNT COLLATERAL")

(A) in the case of any Company, all deposit accounts and/or lockboxes

established for collection of Receivables and all funds on deposit therein and

all certificates and instruments, if any, at any time or evidencing such

accounts, lockboxes or such funds and (B) in the case of SPE:

 

                  (1) all deposit accounts, including the Lockbox Accounts, the

                  Lockboxes, and all funds on deposit therein and all

                  certificates and instruments, if any, from time to time

                  representing or evidencing any deposit account, the Lockbox

                  Accounts, the Lockboxes or such funds,

 

                  (2) the Collection Account, the Concentration Account and all

                  funds on deposit therein and all certificates and instruments,

                  if any, from time to time representing or evidencing the

                  Collection Account, the Concentration Account or such funds,

 

                  (3) all Deposit Investments from time to time of amounts in

                  the Collection Account, and all certificates, instruments and

                  investment property, if any, from time to time representing or

                  evidencing such Deposit Investments,

 

                  (4) all notes, certificates of deposit and other instruments

                  in substitution for or relating to any of the then existing

                  Account Collateral, and

 

                  (5) all interest, dividends, cash, instruments, investment

                  property and other property from time to time received,

                  receivable or otherwise distributed with respect to or in

                  exchange for any and all of the then existing Account

                  Collateral; and

 

            (g) all proceeds of such Receivable and with respect to any of the

foregoing.

 

            "REPURCHASED GOODS" means any Returned Goods or Scrapped Goods, the

original sale of which gave rise to a Transferred Receivable, for which the SPE

has received, pursuant to the Sale Agreement, a payment in cash for the

adjustment of the Transferred Receivable with respect to which such return

arose.

 

            "RETURNED GOODS" means goods, the sale of which gave rise to a

Receivable, that are returned to a Company by an Obligor for any reason.

 

            "SCRAPPED GOODS" means goods, the sale of which gave rise to a

Receivable, which are rejected by the applicable Obligor for any reason but

which are scrapped rather than being returned to the applicable Company or any

of its affiliates.

 

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<PAGE>

 

            "SOLD RECEIVABLE" means a Receivable and Related Security identified

for sale to SPE under the Sale Agreement.

 

            "SPE MEMBERSHIP COLLATERAL" means the membership interest of the SPE

upon which a Lender Interest is granted or purported to be granted by the

Companies or any other owner thereof to the Collateral Agent under the Loan

Documents.

 

            "SUB-SERVICER" means any Person with whom the Companies enter into a

written contract pursuant to and in accordance with the Purchase Agreement

relating to the servicing, administration or collection of the Transferred

Receivables.

 

            "SUBSIDIARY" means, with respect to any Person, any corporation or

other entity (a) of which securities or other ownership interests having

ordinary voting power to elect a majority of the board of directors or other

Persons performing similar functions are at the time directly or indirectly

owned by such Person or (b) that is directly or indirectly controlled by such

Person within the meaning of control under Section 15 of the Securities Act of

1933, as amended from time to time.

 

            "TERMINATION EVENT" has the meaning ascribed to it in the Purchase

Agreement.

 

            "TRANSFERRED RECEIVABLE" means any Sold Receivable or