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Security Interests: Life InsurancePolicies
and any and all additions, renewals and supplementary contracts
issued in connection therewith and any and all proceeds thereof
(said policies and contracts and proceeds are hereinafter collectively
referred to as the “Insurance Policy”), subject to all the terms and
conditions of this Assignment of Life Insurance Policy as Collateral
(this “Assignment”). This Assignment is made pursuant to one
or more Credit Agreements dated as of
among
(the “Borrower”), certain of their affiliates
and Assignee (as they may be amended, replaced or novated from
time to time, the “Credit Agreements”) which provides for loans to
the Borrower in the original aggregate principal amount of up to
[$
].
This Assignment includes, without limitation, assignment of the
following rights of Owner:(a)the sole right to collect from the
Insurer the net proceeds of the Insurance Policy due to the death of
the insured or maturity; (b)the sole right to surrender the Insurance
Policy and receive the surrender value thereof at any time provided
by the terms of the Insurance Policy and at such other times as the
Insurer may allow; (c)the sole right to obtain one or more loans or
advances on the Insurance Policy at any time, either from the Insurer
or from other persons, and to pledge or assign the Insurance Policy
as security for such loans or advances; (d)the sole right to collect
and receive all distributions or shares of surplus, dividend deposits
or additions to the Insurance Policy now or hereafter made or
apportioned thereto, and to exercise any and all options contained in
the Insurance Policy with respect thereto; provided, that unless and
until the Assignee shall notify the Insurer in writing to the contrary,
the distributions or shares of surplus, dividend deposits and additions
shall continue on the plan in force at the time of this Assignment;
(e)the sole right to exercise all nonforfeiture rights permitted by
the terms of the Insurance Policy or allowed by the Insurer and to
receive all benefits and advantages derived therefrom; (f)the right to
exercise any and all voting rights or privileges to the extent created or
endowed by the Insurance Policy; and (g)the sole right to sell, settle,
assign, transfer, pledge or grant any right, title or interest in, to and
under the Insurance Policy.
2. Rights Retained. The following rights, so long as the Insurance
Policy has not been surrendered or canceled, are reserved
and excluded from this Assignment and do not pass by virtue
hereof:(a)the right to collect from the Insurer any disability benefit
payable in cash that does not reduce the amount of insurance; and
(b)the right to designate and change the beneficiary of the Insurance
Policy, provided that the Assignee shall continue to be considered the
primary assignee of the Insurance Policy as provided in paragraph 4
below; provided, however, that the reservation of these rights shall
in no way impair the right of the Assignee to surrender the Insurance
Policy completely with all its incidents or impair any other right of the
Assignee hereunder, and any designation or change of beneficiary
or election of a mode of settlement shall be made subject to this
Assignment and to the rights of the Assignee hereunder.
3. Obligations Secured. This Assignment is made, and the Insurance
Policy is to be held, as collateral security for any and all liabilities
of Owner, Borrower and Guarantor to the Assignee, either now
existing or that may hereafter arise, including without limitation
(a)the Obligations defined in the Credit Agreements and obligations
under the Credit Documents and such additional amounts that
Assignee may, in its sole discretion, loan to Borrower or Owner from
time to time after the date hereof, (b)the Guaranteed Obligations
defined in the Guaranty dated as of the date hereof and (c)the
obligations of Borrower or Owner to the Assignee under any financing
arrangements for insurance premiums with respect to the Insurance
Policy (all of which liabilities secured or to become secured are herein
called “Liabilities”). Subject to the terms of this Assignment, Assignee
may apply money received under the Insurance Policy to pay Liabilities
when due in any order Assignee may choose.
4. Benefits Payment Directive. Insurer is hereby authorized and
directed to pay Assignee any and all death benefits and other
amounts due under or on account of the Insurance Policy and
Assignee shall be considered the Insurance Policy’s primary
assignee.
5. Representations. Owner hereby represents and warrants that:
(a)the Insurance Policy is in full force and effect; (b)Owner is the sole
owner of the Insurance Policy and has full authority to assign the
Insurance Policy to Assignee; and (c)Owner has neither assigned,
nor granted or suffered any lien or security interest against, the
Insurance Policy to any other entity which has not been terminated,
except for liens securing the Obligations. Owner further represents
and warrants that no proceedings in bankruptcy are pending or to
its knowledge threatened against Owner (and that no grounds exist
for such proceedings) and that Owner’s property is not subject to any
assignment for the benefit of creditors.
6. Covenants. Owner and Assignee covenant and agree as follows:
(a)that any balance of sums received hereunder from the Insurer
remaining after payment of the then existing Liabilities, matured
or unmatured, shall be paid in full by the Assignee to the persons
entitled thereto under the terms of the Insurance Policy had this
Assignment not been executed; (b)that the Assignee shall not
exercise any of the rights under the Insurance Policy assigned
hereunder until there has been an Event of Default under any Credit
Agreement which shall not have been cured within the time period
set forth in such Credit Agreement; (c)that upon Owner’s request the
Assignee shall forward, without unreasonable delay, to the Insurer,
the Insurance Policy for endorsement of any designation or change
of beneficiary or any election of an optional mode of settlement;
(d)Assignee shall be under no obligation to pay any premium, or the
principal of or interest on any loans or advances on the Insurance
Policy, whether or not obtained by the Assignee, or any other charges
on the Insurance Policy, but such amounts so paid by the Assignee
from its own funds, shall become a part of the Liabilities hereby
secured, shall be due immediately, and shall accrue interest at the
highest rate set forth in the Credit Agreements; (e)the exercise of
any right, option, privilege or power given to the Assignee under this
Assignment shall be at the option of the Assignee, and Assignee
may exercise any such right, option, privilege or power without notice
to, or assent by, or affecting the liability of, or releasing any interest
hereby assigned by Owner; (f)neither the Owner nor the Insurer
shall alter, modify, amend or waive any of the terms and conditions
of the Insurance Policy unless agreed to by the Assignee in writing;
(g)Owner shall not assign, grant or suffer any lien, assignment
or security interest against the Insurance Policy, except for liens,
assignments or security interests in favor of the Assignee; and
(h)that the Assignee shall not exercise any of the rights under the