COMPANIES
FOR CLAIMS IN EXCESS OF $1,000,000.
WHILE NO EVENT OF DEFAULT EXISTS, OBLIGORS
MAY SETTLE, ADJUST OR COMPROMISE ANY INSURANCE CLAIM, AS LONG AS THE PROCEEDS
ARE DELIVERED TO AGENT AS REQUIRED HEREUNDER.
IF AN EVENT OF DEFAULT EXISTS,
ONLY AGENT SHALL BE AUTHORIZED TO SETTLE, ADJUST AND COMPROMISE SUCH CLAIMS.
B.
ANY PROCEEDS OF INSURANCE COVERING THE COLLATERAL AND ANY AWARDS
ARISING FROM CONDEMNATION OR EXPROPRIATION OF ANY COLLATERAL IN EACH CASE
EXCEEDING $1,000,000 SHALL BE PAID TO AGENT TO BE APPLIED IN ACCORDANCE WITH THE
TERMS OF SECTION 5.2.
ANY SUCH PROCEEDS OR AWARDS THAT RELATE TO INVENTORY
SHALL BE APPLIED TO PAYMENT OF THE LOANS, AND THEN TO ANY OTHER OBLIGATIONS
OUTSTANDING, AND THEN ANY REMAINING BALANCE DEPOSITED IN A CASH COLLATERAL
ACCOUNT (SUBJECT TO SECTION 8.2.5).
C.
BORROWER AGENT SHALL PROMPTLY PROVIDE WRITTEN NOTICE TO AGENT IN
THE EVENT A LOSS, THEFT, DAMAGE OR DESTRUCTION OCCURS WITH RESPECT TO ANY
COLLATERAL IF THE AMOUNT NOT COVERED BY INSURANCE EXCEEDS THE DOLLAR EQUIVALENT
OF $5,000,000.
8.5.3
PROTECTION OF COLLATERAL.
ALL EXPENSES OF
PROTECTING, STORING, WAREHOUSING, INSURING, HANDLING, MAINTAINING AND SHIPPING
ANY COLLATERAL, ALL TAXES PAYABLE WITH RESPECT TO ANY COLLATERAL (INCLUDING ANY
SALE THEREOF), AND ALL OTHER PAYMENTS REQUIRED TO BE MADE BY AGENT TO ANY PERSON
TO REALIZE UPON ANY COLLATERAL, SHALL BE BORNE AND PAID BY BORROWERS.
AGENT
SHALL NOT BE LIABLE OR RESPONSIBLE IN ANY WAY FOR THE SAFEKEEPING OF ANY
COLLATERAL (EXCEPT FOR REASONABLE CARE OF COLLATERAL IN AGENT'S ACTUAL
POSSESSION), FOR ANY LOSS OR DAMAGE THERETO (EXCEPT FOR REASONABLE CARE IN ITS
CUSTODY WHILE COLLATERAL IS IN AGENT'S ACTUAL POSSESSION), FOR
66
ANY DIMINUTION IN THE VALUE THEREOF, OR FOR ANY ACT OR DEFAULT OF ANY
WAREHOUSEMAN, CARRIER, FORWARDING AGENCY OR OTHER PERSON WHATSOEVER, BUT THE
SAME SHALL BE AT OBLIGORS' SOLE RISK.
8.5.4
DEFENSE OF TITLE TO COLLATERAL.
EACH OBLIGOR SHALL
AT ALL TIMES DEFEND ITS TITLE TO COLLATERAL AND AGENT'S LIENS THEREIN AGAINST
ALL PERSONS, CLAIMS AND DEMANDS WHATSOEVER, EXCEPT PERMITTED LIENS.
8.5.5
PROCEEDS OF COLLATERAL.
EACH OBLIGOR SHALL AT ALL
TIMES MAINTAIN IN CASH COLLATERAL ACCOUNTS ALL PROCEEDS OF COLLATERAL AND NOT
COMMINGLE SUCH PROCEEDS WITH PROCEEDS OF ACCOUNTS COLLECTED UNDER THE
RECEIVABLES PURCHASE FACILITY OR ANY OTHER FACTORING OR SECURITIZATION
ARRANGEMENT EXCEPT DURING ANY "RAMP-UP" PERIOD WITH RESPECT TO THE RECEIVABLES
PURCHASE FACILITY OR ANY OTHER FACTORING OR SECURITIZATION ARRANGEMENT IF AND
ONLY IF AGENT, THE RELEVANT BORROWERS AND THE AGENT UNDER SUCH FACILITY OR
ARRANGEMENT HAVE ENTERED INTO AN AGREEMENT IN RESPECT OF ANY COMMINGLED PROCEEDS
SUBSTANTIALLY IN THE FORM OF EXHIBIT E.
8.6
Power of Attorney.
Each Obligor hereby irrevocably constitutes
and appoints Agent (and all Persons designated by Agent) as such Obligor's true
and lawful attorney (and agent-in-fact) for the purposes provided in this
Section.
Agent, or Agent's designee, may, without notice and in either its or
an Obligor's name, but at the cost and expense of Borrowers:
A.
ENDORSE AN OBLIGOR'S NAME ON ANY PAYMENT ITEM OR OTHER PROCEEDS
OF COLLATERAL (INCLUDING