This excerpt taken from the AKS 8-K filed Feb 23, 2007.
8.6. General Provisions.
8.6.1. Location of Collateral. All tangible items of Collateral, other than Inventory in transit, shall at all times be kept by Borrower at the business locations set forth in Schedule 8.6.1, except that Borrower may (a) make sales or other dispositions of Collateral in accordance with Section 10.2.6; and (b) move Collateral to another location in the United States.
8.6.2. Insurance of Collateral; Condemnation Proceeds.
(a) Without limiting the provisions set forth in Section 10.1.7, the Borrower will maintain or cause to be maintained replacement value property insurance (including business interruption insurance) on the Collateral under such policies of insurance, with such insurance companies (including captive insurers reasonably acceptable to Agent), in such amounts (including after giving effect to self insurance reasonably acceptable to Agent), with such deductibles, and covering such risks as are at all times reasonably satisfactory to the Agent. Each policy of insurance on the Collateral shall contain a loss payable clause or endorsement, reasonably satisfactory in form and substance to the Agent, that names the Agent for the benefit of the Lenders as the loss payee thereunder for any covered loss and shall endeavor to provide at least thirty (30) days prior written notice to the Agent of any cancellation of such policy. In addition, the Borrower shall give at least thirty (30) days prior written notice to the Agent of any reduction in coverage or cancellation of the policies of insurance described in the preceding sentence.
(b) Any proceeds of insurance (including, without limitation, proceeds from business interruption insurance and excluding proceeds from workers compensation or D&O insurance) solely to the extent attributable to the Collateral and any awards arising from condemnation solely to the extent attributable to the Collateral shall be paid to Agent. Any such proceeds or awards that relate to Collateral shall be applied to payment of the Revolver Loans, and then to any other Obligations outstanding and thereafter paid to Borrower or in accordance with applicable law.
8.6.3. 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 Borrower. Agent shall not be liable or responsible in any way for the safekeeping of any Collateral, for any loss or damage thereto (except for reasonable care in its custody while Collateral is in Agents actual possession), for 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 Borrowers sole risk.
8.6.4. Defense of Title to Collateral. Borrower shall at all times take all reasonable actions to defend its title to Collateral and Agents Liens therein against all Persons, claims and demands whatsoever, except Permitted Liens.
8.7. Power of Attorney. Borrower hereby irrevocably constitutes and appoints Agent (and all Persons designated by Agent) as Borrowers true and lawful attorney (and agent-in-fact) for the purposes provided in this Section. Agent, or Agents designee, may, without notice and in either its or Borrowers name, but at the cost and expense of Borrower:
(a) Endorse Borrowers name on any Payment Item or other proceeds of Collateral (including proceeds of insurance) that come into Agents possession or control; and
(b) During an Event of Default which is continuing, (i) notify any Account Debtors of the assignment of their Accounts, demand and enforce payment of Accounts, by legal proceedings or otherwise, and generally exercise any rights and remedies with respect to Accounts; (ii) settle, adjust, modify, compromise, discharge or release any Accounts or other Collateral, or any legal proceedings brought to collect Accounts or Collateral; (iii) sell or assign any Accounts and other Collateral upon such terms, for such amounts and at such times as Agent reasonably deems advisable; (iv) take control, in any manner, of any proceeds of Collateral; (v) prepare, file and sign Borrowers name to a proof of claim or other document in a bankruptcy of an Account Debtor, or to any notice, assignment or satisfaction of Lien or similar document; (vi) receive, open and dispose of mail addressed to Borrower, and notify postal authorities to change the address for delivery thereof to such address as Agent may designate; (vii) endorse any Chattel Paper, Document, Instrument, invoice, freight bill, bill of lading, or similar document or agreement relating to any Accounts, Inventory or other Collateral; (viii) sign its name to verifications of Accounts and notices to Account Debtors; (ix) use the information recorded on or contained in any data processing equipment and computer hardware and software relating to any Collateral; (x) make and adjust claims under policies of insurance; (xi) take any action as may be reasonably necessary in Agents determination or appropriate to obtain payment under any letter of credit or bankers acceptance for which Borrower is a beneficiary; and (xii) take all other actions as Agent deems reasonably appropriate to fulfill Borrowers obligations under the Loan Documents.