EXHIBIT 99 (k)(4)
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NAB EXCHANGEABLE PREFERRED TRUST
ADRs SECURITY AND PLEDGE AGREEMENT
Dated: September ___, 1998
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Table of Contents
Page
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1. Definitions.................................................................2
(a) Defined Terms..................................................2
(b) Uniform Commercial Code........................................5
(c) Terms Defined in the Trust Agreement...........................5
2. Delivery by the Pledgor to Collateral Agent.................................5
(a) Initial Delivery of Collateral.................................5
(b) Collateral Requirement.........................................5
3. Grant of Security Interest..................................................6
4. Maintenance of Collateral...................................................7
5. Voting and Distributions in Respect of Collateral...........................8
6. Remedies Upon Events of Default.............................................8
(a) Delivery Upon Event of Default.................................8
(b) Power of Attorney..............................................9
(c) Waivers by the Pledgors........................................9
(d) Rights and Remedies Under the Uniform Commercial Code..........9
7. Other Provisions Regarding the Collateral...................................9
(a) No Disposition.................................................9
(b) Further Protections............................................9
(c) Delay in Enforcement; No Waiver................................9
8. Representations and Warranties.............................................10
(a) Representations and Warranties of Pledgor.....................10
(b) Representations and Warranties of Collateral Agent............11
9. The Collateral Agent.......................................................11
(a) Appointment of Collateral Agent...............................11
(b) Duties of Collateral Agent....................................11
(c) Compensation..................................................12
(d) Reliance......................................................12
(e) Liability of Collateral Agent.................................12
(f) Risk of Funds.................................................12
(g) Use of Sub-Agents or Attorneys................................13
(h) Recitals and Statements.......................................13
(i) Knowledge.....................................................13
(j) Merger........................................................13
(k) Resignation of Collateral Agent...............................13
(l) Removal.......................................................13
(m) Appointment of Successor......................................13
(n) Acceptance by Successor.......................................14
10. Miscellaneous..............................................................14
(a) Amendments, Etc...............................................14
(b) Notices and Other Communications..............................14
(c) Waivers.......................................................16
(d) Non-Assignment................................................16
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(e) Waiver of Jury Trial..........................................16
(f) Governing Law.................................................16
(g) Headings......................................................16
(h) Entire Agreement..............................................16
(i) Counterparts..................................................17
(j) Force Majeure.................................................17
(k) Binding Effect................................................17
(l) Separability..................................................17
11. Termination of Agreement...................................................17
12. Application of Bankruptcy Code.............................................17
13. No Personal Liability of Trustees..........................................17
14. Limitation on Liability....................................................17
15. Consent to Jurisdiction....................................................18
16. Judgement Currency.........................................................18
17. Waiver of Immunities.......................................................18
Exhibit A.........FORM OF CONTROL AGREEMENT
Exhibit B.........FORM OF PLEDGE
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ADRs SECURITY AND PLEDGE AGREEMENT
This Security and Pledge Agreement (the "Agreement") is made as of
September __, 1998 among NAB Exchangeable Preferred Trust, a business trust
created pursuant to the Business Trust Act of the State of Delaware (Chapter 38,
Title 12, of the Delaware Code, 12 Del. C. (Sections 3801 et seq.)) (such trust
and the trustees thereof acting in their capacity as such being referred to
herein as the "Trust"), Cuzzano (UK) Company, a special purpose company with
unlimited liability incorporated under the laws of England and Wales, and
domiciled in, the United Kingdom (the "U.K. Company"), Cuzzano (Investments)
Limited, a company incorporated with limited liability under the laws of, and
domiciled in, Jersey, the Channel Islands (the "Jersey Subsidiary") (the U.K.
Company and the Jersey Subsidiary being sometimes individually referred to
herein as a "Pledgor" and collectively as the "Pledgors"), and The Bank of New
York, a New York banking corporation, as agent and custodian for and on behalf
of the U.K. Company and the Trust, as applicable (the "Collateral Agent").
WHEREAS, the Trust has filed with the Securities and Exchange
Commission a registration statement on Form N-2 (File Nos. 333-60719 and
811-08939) and Pre-Effective Amendments No. 1 and 2 thereto contemplating the
offering (the "Offering") of up to ___ of its Trust Units Exchangeable for
Preference Shares-SM- (the "TrUEPrS-SM-"), the terms of which contemplate that
the Trust will distribute to the Holders (as defined in the Trust Agreement
described below) of TrUEPrS, upon the occurrence of an Exchange Event (as
defined in the Trust Agreement) either (i) American Depositary Receipts ("ADRs")
evidencing, for each TrUEPrS, one American Depositary Share ("ADS") representing
two fully paid non-cumulative preference shares, liquidation preference US$12.50
per share (the "NAB Preference Shares"), or (ii) if the Exchange Event is the
redemption, mandatory repurchase ("Buy-Back") or reduction of capital followed
by redemption ("Capital Reduction") of the NAB Preference Shares for cash,
Holders of TrUEPrS will be entitled to receive US$25 per TrUEPrS plus the
accrued dividend distribution thereon for the current quarterly dividend period
and not ADRs.
WHEREAS, concurrently with the execution and delivery of this
Agreement, the TrUEPrS are being issued pursuant to an Amended and Restated
Trust Agreement, dated as of September 10, 1998 (the "Trust Agreement"), among
the trustees of the Trust, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, as depositor, ML IBK Positions,
Inc., as Sponsor, and the Holders of the TrUEPrS.
WHEREAS, concurrently with the execution and delivery of this
Agreement, the Trust is using the proceeds of the Offering to purchase the __%
Mandatory Redeemable Debt Securities due 2047 (the "Debt Securities") issued by
the U.K. Company with an aggregate principal amount equal to such proceeds.
WHEREAS, concurrently with the execution and delivery of this
Agreement, the U.K. Company is using the proceeds from the sale of the Debt
Securities to purchase at a price equal to their liquidation preference up to
______ fully paid non-dividend paying preference shares,
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-SM- Service mark of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., Inc.
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liquidation preference US$25 per share (the" Jersey Preference Shares"), issued
by the Jersey Subsidiary.
WHEREAS, concurrently with the execution of this Agreement, the Jersey
Subsidiary is using the proceeds from the sale of the Jersey Preference Shares
to make a payment in consideration of the issuance by the Depositary (as defined
herein) of ADRs evidencing up to _____ ADSs each representing two NAB Preference
Shares deposited by NAB.
WHEREAS, the Jersey Subsidiary desires to grant a security interest in
the ADRs evidencing the ADSs for the benefit of the U.K. Company as security for
the redemption obligations of the Jersey Subsidiary under the Jersey Preference
Shares.
WHEREAS, the Jersey Subsidiary desires to grant a security interest in
the ADRs evidencing the ADSs for the benefit of the Trust, as security for the
Jersey Subsidiary's obligations under the ADSs Purchase Contract, such security
interest being subject to the prior Lien granted by the Jersey Subsidiary to the
U.K. Company and hypothecated by the U.K. Company to the Trust hereunder.
WHEREAS, concurrently with the execution of this Agreement, the Jersey
Subsidiary will Deliver, with the consent of the U.K. Company, the ADRs
evidencing the ADSs representing the NAB Preference Shares to The Bank of New
York, acting in its capacity as securities intermediary (the "Securities
Intermediary"), which, pursuant to the terms of a control agreement, dated
September __, 1998, among the U.K. Company, the Jersey Subsidiary, the Trust,
the Collateral Agent and the Securities Intermediary, the form of which is
attached hereto as Exhibit A (the "Control Agreement"), has agreed to credit the
Collateral (as defined herein) Delivered hereby to the Account (as defined
herein), as security for the redemption obligations of the Jersey Subsidiary
under the Jersey Preference Shares and the obligations of the Jersey Subsidiary
under the ADSs Purchase Contract.
WHEREAS, the NAB Preference Shares represented by the ADSs have been
deposited with and held by The Bank of New York, as depositary (the
"Depositary"), pursuant to a Deposit Agreement, dated as of September __, 1998,
between NAB and the Depositary.
WHEREAS, the Jersey Subsidiary desires to consent to the assignment by
the U.K. Company of the security interest created hereunder to the Trust, as
pledgee, transferee and assignee thereof, as security for the redemption
obligations of the U.K. Company under the Debt Securities.
WHEREAS, the U.K. Company desires to consent to the grant by the Jersey
Subsidiary of the security interest in the ADRs in favor of the Trust created
hereunder to secure the obligations of the Jersey Subsidiary under the ADSs
Purchase Contract, such security interest being subject to the prior Lien
granted by the Jersey Subsidiary to the U.K. Company and hypothecated by the
U.K. Company to the Trust hereunder.
WHEREAS, pursuant to the Jersey Preference Shares Security and Pledge
Agreement (the "Jersey Preference Shares Agreement"), among the Trust, the U.K.
Company and the Collateral Agent, the U.K. Company has granted a security
interest in the Jersey Preference
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Shares and any redemption proceeds thereof for the benefit of the Trust, as
pledgee thereof, as security for the redemption obligations of the U.K. Company
under the Debt Securities.
WHEREAS, the Trust and the Pledgors desire that, upon the occurrence of
an Exchange Event the ADRs or any cash redemption proceeds thereof will be
delivered to the Trust for distribution to the Holders of TrUEPrS.
WHEREAS, the Trust and the Pledgors desire that prior to the occurrence
of an Exchange Event, beneficial ownership of the Jersey Preference Shares and
the ADRs pledged hereunder remain in the U.K. Company and the Jersey Subsidiary,
respectively, unless and until as a result of the occurrence of an Exchange
Event, the ADRs or the cash redemption proceeds thereof are delivered to the
Trust in accordance with the terms hereof, provided, however, that the Jersey
Subsidiary or the Collateral Agent shall vote the ADSs and direct the Depositary
to vote the NAB Preference Shares represented thereby as directed by the Holders
of the TrUEPrS in accordance with the procedures set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and adequacy of which is
hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions.
(a) Defined Terms. For all purposes of this Agreement, except as
otherwise expressly provided or unless the context otherwise requires, the
following terms, when used herein, shall have the following meanings:
"Account" means the separate, non-commingled securities account
established by the Collateral Agent with the Securities Intermediary.
"ADRs" has the meaning specified in the first recital in this
Agreement.
"ADSs" has the meaning specified in the first recital in this
Agreement.
"ADSs Purchase Contract" means the ADSs Purchase Contract, dated
September __, 1998, between the Trust and the Jersey Subsidiary, as amended
pursuant to the terms thereof.
"Agreement" means this ADRs Security and Pledge Agreement and any
schedules and exhibits hereto.
"Collateral" means all the ADRs Delivered hereunder and any proceeds
from the redemption thereof.
"Collateral Agent" means the financial institution identified as such
in the introductory paragraph hereof, or any successor appointed in accordance
with Section 9(l).
"Collateral Amount" means, as of the date of determination, the amount
of Collateral then held by the Securities Intermediary.
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"Control Agreement" has the meaning specified in the eighth recital in
this Agreement.
"Debt Securities" has the meaning specified in the third recital in
this Agreement.
"Delivery" means with respect to the ADRs, the delivery of such ADRs,
free and clear of all Liens (other than a Lien created or permitted by this
Agreement or any Lien created by the Trust), in accordance with Section 2
hereof. The term "Deliver" used as a verb has a corresponding meaning.
"Depositary" has the meaning specified in the ninth recital in this
Agreement.
"Event of Default" means the occurrence of an Exchange Event.
"Jersey Preference Shares" has the meaning specified in the fourth
recital in this Agreement.
"Jersey Preference Shares Agreement" has the meaning specified in the
twelfth recital in this Agreement.
"Jersey Subsidiary" has the meaning specified in the introductory
paragraph of this Agreement.
"Lien" means any lien, mortgage, security interest, pledge, charge,
encumbrance, claim or equity of any kind.
"NAB" has the meaning specified in the first recital in this Agreement.
"NAB Preference Shares" has the meaning specified in the first recital
in this Agreement.
"Offering" has the meaning specified in the first recital in this
Agreement.
"Pledgor" or Pledgors" has the meaning specified in the introductory
paragraph of this Agreement.
"Required Collateral Amount" means the Collateral required to be
pledged hereunder in order to secure the prompt and complete payment of the
redemption proceeds of the Jersey Preference Shares in accordance with the terms
thereof; the Required Collateral Amount shall at all times equal the aggregate
liquidation amount in US dollars of the Jersey Preference Shares owned by the
U.K. Company.
"Responsible Officer" means, when used with respect to the Collateral
Agent, any vice president, assistant vice president, trust officer, assistant
treasurer or assistant secretary located in the division or department of the
Collateral Agent responsible for performing the obligations of the Collateral
Agent under this Agreement, or in any other division or department of the
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Collateral Agent performing operations substantially equivalent to those
performed by such division or department pursuant hereto, or any other officer
of the Collateral Agent or any successor Collateral Agent customarily performing
functions similar to those performed by any of the aforesaid officers, and also
means, with respect to any matter relating to this Agreement or the Collateral,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Securities Intermediary" means the financial institution identified as
such in the eighth recital hereof, or any successor thereto.
"Transfer Restriction" means, with respect to any item of Collateral,
any condition to or restriction on the ability of the holder thereof to sell,
assign or otherwise transfer such item of Collateral or to enforce the
provisions thereof or of any document related thereto whether set forth in such
item of Collateral itself or in any document related thereto, including, without
limitation, (i) any requirement that any sale, assignment or other transfer or
enforcement of such item of Collateral be consented to or approved by any
Person, including, without limitation, the issuer thereof or any other obligor
thereon, (ii) any limitations on the type or status, financial or otherwise, of
any purchaser, pledgee, assignee or transferee of such item of Collateral, (iii)
any requirement of the delivery of any certificate, consent, agreement, opinion
of counsel, notice or any other document of any Person to the issuer of, any
other obligor on or any registrar or transfer agent for, such item of
Collateral, prior to the sale, pledge, assignment or other transfer or
enforcement of such item of Collateral and (iv) any registration or
qualification requirement for such item of Collateral pursuant to any federal,
state or foreign securities law; provided that (x) the required delivery of any
assignment from the seller, pledgor, assignor or transferor of such item of
Collateral, together with any evidence of the corporate or other authority of
such Person, or (y) any registration or qualification requirement for such item
of Collateral pursuant to any federal, state or foreign securities law which is
generally applicable to all holders of such item of Collateral, shall not
constitute a "Transfer Restriction."
"TrUEPrS" has the meaning specified in the first recital in this
Agreement.
"Trust" has the meaning specified in the introductory paragraph of this
Agreement.
"Trust Agreement" has the meaning specified in the second recital in
this Agreement.
"Trustee" or "Trustees" means any trustee or trustees of the Trust
identified on the signature pages to the Trust Agreement, or any successor as
such trustee or trustees.
"U.K. Company" has the meaning specified in the introductory paragraph
of this Agreement.
"Uniform Commercial Code" means, at any time, the Uniform Commercial
Code in effect at such time in the State of New York or deemed to be in effect
pursuant to U.S. law and regulations applicable thereto.
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(b) Uniform Commercial Code. Unless otherwise defined herein, all terms
defined in Article 8 or Article 9 of the Uniform Commercial Code are used herein
as therein defined.
(c) Terms Defined in the Trust Agreement. Capitalized words and phrases
used herein and not otherwise defined herein are used herein as defined in the
Trust Agreement.
2. Delivery by the Jersey Subsidiary to Collateral Agent.
(a) Initial Delivery of Collateral.
The Jersey Subsidiary shall Deliver ADRs representing the Required
Collateral Amount as of the date hereof to the Securities Intermediary as
follows:
(i) in the case of each certificated security (other than a
clearing corporation security) or instrument, by:
(A) the delivery of such certificated security or
instrument to the Securities Intermediary registered
in the name of the Securities Intermediary or its
affiliated nominee or endorsed to the Securities
Intermediary in blank;
(B) causing the Securities Intermediary to continuously
indicate by book-entry that such certificated
security or instrument is credited to the Account;
and
(C) the Securities Intermediary maintaining continuous
possession of such certificated security or
instrument in the State of New York; and
(ii) in the case of each clearing corporation security, by causing:
(A) such clearing corporation security to be continuously
registered to the clearing corporation or its
custodian or the nominee of either subject to the
exclusive control of such clearing corporation (in
the case of a clearing corporation security that is
an uncertificated security) or continuously
maintained in the State of New York in the possession
of, and registered in the name of, such clearing
corporation or its custodian or the nominee of either
subject to the exclusive control of such clearing
corporation (in the case of a clearing corporation
security that is a certificated security);
(B) the relevant clearing corporation to continuously
indicate by book-entry that such clearing corporation
security is credited to the securities account
maintained by it for the benefit of the Securities
Intermediary; and
(C) the Securities Intermediary to continuously indicate
by book-entry that such clearing corporation security
is credited to the Account.
(b) Collateral Requirement. If at any time subsequent to the date
hereof, the Collateral Amount is less than the Required Collateral Amount, the
Jersey Subsidiary shall Deliver, or cause to be Delivered, to the Securities
Intermediary, in accordance with Section 2(a), one or more certificates
representing ADRs such that the Collateral Amount will at all times
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equal the Required Collateral Amount. The Securities Intermediary shall hold
such additional ADRs as from time to time may be Delivered or caused to be
Delivered, to the Securities Intermediary as Collateral as expressly provided
herein in order to perfect the continuing first priority security interest in
such Collateral granted to the Collateral Agent, as agent of and for the benefit
of the U.K. Company.
3. Grant of Security Interest.
(a) (i) As security for the prompt and complete payment and delivery of
the redemption proceeds of the Jersey Preference Shares when due in accordance
with the terms thereof, the Jersey Subsidiary hereby pledges, assigns, grants
and conveys unto the Collateral Agent, as agent of and for the benefit of the
U.K. Company or the Trust, as holder of the Jersey Preference Shares, a
continuing first priority security interest under the Uniform Commercial Code or
other applicable law in and to, and a general first lien upon and right of set
off against, and a first fixed charge of, the Jersey Subsidiary's right, title
and interest in and to, the ADRs evidencing the ADSs which are Delivered
hereunder as security pursuant to and in accordance with the provisions of this
Agreement, all certificates or instruments representing or evidencing any or all
of the foregoing, and all distributions or dividends and proceeds from time to
time received, receivable or otherwise distributed in respect of, or in exchange
for, any or all of the foregoing (whether such proceeds arise before or after
the commencement of any proceeding under any applicable bankruptcy, insolvency
or other similar law, by or against the Jersey Subsidiary) and, subject to
Section 5 hereof, all powers and rights of the Jersey Subsidiary now or
hereafter acquired by the Jersey Subsidiary, including rights of enforcement,
under or with respect to any or all of the foregoing.
(ii) As security for the prompt and complete delivery of the ADRs
evidencing the ADSs when due in accordance with the terms of the ADSs
Purchase Contract, the Jersey Subsidiary hereby pledges, assigns,
grants and conveys unto the Collateral Agent, as agent of and for the
benefit of the Trust, a continuing security interest under the Uniform
Commercial Code or other applicable law in and to, and a general lien
upon and right of set off against, the Jersey Subsidiary's right, title
and interest in and to, the ADRs evidencing the ADSs which are
Delivered hereunder as security pursuant to and in accordance with the
provisions of this Agreement, all certificates or instruments
representing or evidencing any or all of the foregoing, and all
distributions or dividends and proceeds from time to time received,
receivable or otherwise distributed in respect of, or in exchange for,
any or all of the foregoing (whether such proceeds arise before or
after the commencement of any proceeding under any applicable
bankruptcy, insolvency or other similar law, by or against the Jersey
Subsidiary) and, subject to Section 5 hereof, all powers and rights of
the Jersey Subsidiary now or hereafter acquired by the Jersey
Subsidiary, including rights of enforcement, under or with respect to
any or all of the foregoing. The security interest granted in favor of
the Trust pursuant to this clause shall be subject only to the prior
Lien granted to the U.K. Company or the Trust, as holder of the Jersey
Preference Shares by the Jersey Subsidiary under Section 3(a)(i) hereof
and hypothecated by the U.K. Company to the Trust under Section 3(b)
hereof.
(b) As security for the prompt and complete payment and delivery of the
redemption proceeds of the Debt Securities when due in accordance with the terms
thereof, the U.K.
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Company hereby pledges, transfers and assigns unto the Collateral Agent, in its
role as agent of and for the benefit of the Trust, the security interest
created, and all Collateral pledged, hereunder.
(c) (i) The Jersey Subsidiary hereby consents to the pledge, transfer
and assignment by the U.K. Company to the Collateral Agent, as agent of and for
the benefit of the Trust, of the security interest created, and all Collateral
pledged, hereunder as described in paragraph (b) above.
(ii) The U.K. Company hereby consents to the pledge, transfer and
assignment by the Jersey Subsidiary to the Collateral Agent, as agent
of and for the benefit of the Trust, of the security interest created,
and all Collateral pledged, hereunder as described in paragraph (a)(ii)
above.
(d) (i) Each Pledgor shall, at its expense and in such manner and form
as the Trust or the Collateral Agent may reasonably require, give, execute,
deliver, file and record any financing statement, notice, instrument, document,
agreement or other papers, and shall take all other action, that may be
necessary or desirable in order to create, preserve, perfect, substantiate or
validate any security interest in the Collateral granted by such Pledgor
pursuant hereto or to enable the Collateral Agent to exercise and enforce its
rights and the rights of the U.K. Company and the Trust, as applicable,
hereunder with respect to such security interest.
(ii) The U.K. Company hereby undertakes to complete and file with the
Companies Office Registry of the United Kingdom registration forms
(standard form 395) and original executed counterpart signature pages
of this Agreement, registering the security interests created
hereunder, as soon as possible after execution of this Agreement, but
no later than 10 Business Days subsequent to the date hereof, all in a
form deemed acceptable to the Collateral Agent.
(iii) The Pledgors each will promptly execute and deliver to the
Collateral Agent financing statements conforming to the Uniform
Commercial Code in effect in the states of New York and Delaware and
any jurisdictions deemed appropriate by the Collateral Agent, and such
other documents as may be necessary or desirable in order to perfect
the security interests granted hereby, all in a form the Collateral
Agent reasonably deems to be acceptable.
(iv) Contemporaneously with the execution of this Agreement, the Jersey
▇▇▇▇▇▇▇▇▇▇ agrees to deliver to NAB a notice substantially in the form
attached hereto as Exhibit A and to obtain the acknowledgement of such
notice by NAB.
(v) Upon the request of the Collateral Agent, the Pledgors also agree
to execute and deliver to the Collateral Agent for filing by the
Collateral Agent continuation statements conforming to the Uniform
Commercial Code in effect in any state or jurisdiction deemed
appropriate by the Collateral Agent and in a form the Collateral Agent
reasonably deems to be acceptable. If either Pledgor fails to deliver
to the Collateral Agent financing statements or continuation statements
that the Collateral Agent requests, the Collateral Agent may, to the
extent permitted by law and without limiting its other
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rights under this Agreement, execute and file in such ▇▇▇▇▇▇▇'s name,
as such ▇▇▇▇▇▇▇'s attorney-in-fact, such documents and such Pledgor
does hereby designate the Collateral Agent as its attorney-in-fact to
execute and file any such financing statement or continuation
statement.
4. Maintenance of Collateral.
(a) The Collateral shall be maintained in accordance with the Control
Agreement.
(b) Each Pledgor shall not be entitled to receive for its own account
any dividends, distributions and other payments relating to the Collateral;
provided, however, that the foregoing shall in no event apply to any Income
Entitlement. The Collateral Agent shall retain such payments (and any such
payments which are received by a Pledgor shall be received in trust for the
benefit of the Trust, shall be segregated from other funds of the Pledgor and
shall forthwith be paid over to the Collateral Agent), and the Collateral Agent
shall hold all such payments so retained by, or paid over to, the Collateral
Agent as Collateral hereunder and maintain such Collateral in accordance with
this Section.
5. Voting and Distributions in Respect of Collateral.
(a) The Jersey Subsidiary shall, or shall cause the Collateral Agent
to, vote the ADSs or direct the Depositary to vote the NAB Preference Shares, in
each case, as directed by the Holders of the TrUEPrS in accordance with the
procedures set forth herein and the Deposit Agreement.
(b) Each TrUEPrS will entitle the Holder thereof to direct the exercise
of the voting rights attaching to one ADS and the two NAB Preference Shares
represented thereby.
(c) Upon receipt of notice of any meeting at which Holders of ADSs or
NAB Preference Shares are entitled to vote, (x) the Jersey Subsidiary shall as
soon as practicable thereafter, notify the Collateral Agent, (y) the Collateral
Agent shall, as soon as practicable thereafter, notify the Trustees of the Trust
and (z) the Trustees of the Trust shall, as soon as practicable thereafter,
notify the Holders of TrUEPrS, which notification, in each case shall be
transmitted by all reasonable means, a notice which shall contain (i) such
information as is contained in such notice of meeting, (ii) a statement whether
the Holders of TrUEPrS at the close of business on a specified record date will
be entitled, in accordance with any applicable provisions of Australian law and
of the Constitution of NAB, resolutions of the Board of Directors of NAB, the
Deposit Agreement and the Trust Agreement, to instruct the Trustees of the
Trust, who will in turn instruct the Jersey Subsidiary as to the exercise of the
voting rights, if any, pertaining to the ADSs and instruct the Depositary as to
the exercise of the voting rights, if any, pertaining to the NAB Preference
Shares, and (iii) a statement as to the manner in which such instructions may be
given, including an express indication that instructions may be given on behalf
of such Holders by the Trustees of the Trust to the Jersey Subsidiary. Upon the
written request of a Holder of TrUEPrS on such record date, received on or
before the date established by the Collateral Agent for such purpose, the
Collateral Agent and the Jersey Subsidiary shall endeavor insofar as practicable
to vote or cause to be voted each ADS and to direct the Depositary to vote the
NAB Preference Shares represented thereby in accordance with any non-
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discretionary instructions set forth in such request. The Collateral Agent and
the Jersey Subsidiary shall not vote or attempt to exercise the right to vote
the ADSs or to direct the Depositary to vote or attempt to exercise any vote
that attaches to the NAB Preference Shares other than in accordance with the
Holder's instructions. Neither NAB nor the Jersey Subsidiary shall be under any
obligation to verify instructions received from Holders and voted upon by the
Collateral Agent.
The parties hereto agree, in the manner and form as NAB, the Jersey
Subsidiary or the Collateral Agent may reasonably require, to give, execute and
deliver any proxy or such other document necessary to give effect to any voting
arrangements set forth in this Section.
6. Remedies Upon Events of Default.
(a) Delivery Upon Event of Default. If an Event of Default shall have
occurred and be continuing, the Collateral Agent shall deliver or cause the
delivery of, the Collateral to the Trust as soon as practicable thereafter,
whereupon the Trust shall hold such Collateral, with all such rights afforded to
the Collateral Agent hereunder, and any rights it may have as the holder of the
Debt Securities, free and clear of all Liens (other than Liens created by the
Trust) and Transfer Restrictions (other than Transfer Restrictions created by
the Trust), including any equity or right of redemption of the Pledgors which
may be waived, and the Pledgors, to the extent permitted by law, hereby
specifically waive all rights of redemption, stay or appraisal which each has or
may have under any law now existing or hereafter adopted.
(b) Power of Attorney. Upon any delivery of all or any part of any
Collateral duly made under the power of delivery given hereunder or under
judgment or decree in any judicial proceedings for foreclosure or otherwise for
the enforcement of this Agreement, the Collateral Agent is hereby irrevocably
appointed the true and lawful attorney of the Pledgors in the name and stead of
each Pledgor, to make all necessary deeds, bills of sale and instruments of
assignment, transfer or conveyance of the property thus delivered. For that
purpose the Collateral Agent may execute all such documents and instruments.
This power of attorney shall be deemed coupled with an interest, and the
Pledgors hereby ratify and confirm all that attorneys acting under such power,
or such attorneys' successors or agents, shall lawfully do by virtue of this
Agreement. If so requested by the Collateral Agent or by the Trustees, the
Pledgors shall further ratify and confirm any such delivery by executing and
delivering to the Collateral Agent or to the Trustees at the expense of such
party all proper deeds, instruments of assignment, conveyance of transfer and
releases as may be designated in any such request.
(c) Waivers by the Pledgors. The Pledgors waive any presentment,
demand, protest or, to the extent permitted by applicable law, notice in
connection with this Agreement.
(d) Rights and Remedies Under the Uniform Commercial Code. In the event
that the prompt and complete payment and delivery of the redemption proceeds of
the Jersey Preference Shares in accordance with the terms thereof are not paid
or delivered when due, in addition to all other rights and remedies provided for
herein or otherwise available to the Collateral Agent and the U.K. Company and
the Trust, the Collateral Agent may, and at the direction of the Trust shall,
exercise all of the rights and remedies of a secured party under the Uniform
Commercial
10
Code (whether or not the Uniform Commercial Code applies to the Collateral) and
all other applicable law with respect to all or any part of the Collateral.
7. Other Provisions Regarding the Collateral.
Until all obligations of the Jersey Subsidiary under the Jersey
Preference Shares and the ADSs Purchase Contract have been performed in full,
the parties hereto covenant and agree as follows:
(a) No Disposition. Each Pledgor covenants and agrees that it will not
sell, assign, transfer, exchange or otherwise dispose of, or grant any option
with respect to, any of the Collateral, nor will it create, incur or permit to
exist any Lien or Transfer Restrictions on or with respect to any of the
Collateral, any interest therein, or any proceeds thereof, other than those
permitted by this Agreement and Liens created by the Trust.
(b) Further Protections. Each Pledgor will pay in a timely fashion all
taxes, assessments, fees or charges of any nature that are imposed in respect of
the Collateral as a result of such party's ownership thereof or any action or
omission on the part of such Pledgor. The Pledgors will give written notice to
the Trust and the Collateral Agent of, and defend the Collateral against, any
suit, action or proceeding against the Collateral which could adversely affect
the security interests granted hereunder.
(c) Delay in Enforcement; No Waiver. To the extent consistent with the
Uniform Commercial Code and any applicable law, the Collateral Agent can choose
to delay or not to enforce any of its rights under this Agreement without losing
such rights. If the Collateral Agent chooses not to exercise or enforce any of
its rights, each Pledgor agrees that the Collateral Agent is not waiving the
right to enforce such rights at a later time or any of its other rights. Any
waiver of the Collateral Agent's rights under this Agreement must be in writing.
8. Representations and Warranties.
(a) Representations and Warranties of Pledgor. On a continuing basis
during the term of this Agreement, each Pledgor represents and warrants to the
Collateral Agent and to the Trust as follows:
(i) such Pledgor has full power and authority to execute and deliver
this Agreement and to perform and observe the provisions hereof, except
as performance may be limited by bankruptcy, insolvency,
reorganization, moratorium, or other similar laws now or hereafter in
effect relating to creditors' rights, and general principles of equity
(regardless of whether the enforceability of such performance is
considered in a proceeding in equity or at law);
(ii) the execution, delivery and performance of this Agreement by such
Pledgor does not contravene any requirement of law or any material
transactional restriction or material agreement binding on or affecting
such Pledgor or any of its assets;
(iii) this Agreement has been duly and properly executed and delivered
by such Pledgor and constitutes a legal, valid and binding agreement of
such Pledgor enforceable
11
against such Pledgor in accordance with its terms, except as the
enforcement of rights and remedies may be limited by bankruptcy,
insolvency, reorganization, moratorium, or other similar laws now or
hereafter in effect relating to creditors' rights, and general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law);
(iv) no Transfer Restrictions (other than the requirement of the U.K.
Company to cause the security interest hypothecated hereunder to be
registered with the Companies Office Registry in the United Kingdom and
any Transfer Restrictions created by this Agreement and Transfer
Restrictions created by the Trust) exist with respect to or otherwise
apply to the assignment of, or transfer by such Pledgor of possession
of, any items of Collateral to the Collateral Agent hereunder, or the
subsequent sale or transfer of such items of Collateral by the
Collateral Agent pursuant to the terms hereof;
(v) except for the rights of the Trust and of the Collateral Agent on
the Trust's behalf established under this Agreement such Pledgor has
all rights, title and interest in and to the Collateral pledged by it
under this Agreement and, in the case of the U.K. Company, the security
interest created hereby, in each case, free and clear of all Liens
(other than the Lien created by this Agreement) and Transfer
Restrictions (other than Transfer Restrictions created by this
Agreement or the Trust), and has the right to pledge such Collateral as
provided in this Agreement;
(vi) such Pledgor is not in default under any agreement by which the
Collateral may be bound and no litigation, arbitration or
administrative proceeding of which such Pledgor has received notice or
service of process is pending, which default, litigation, arbitration
or administrative proceeding is material to the Collateral in the
context of this Agreement;
(vii) upon (x) the execution of this Agreement and (y) Delivery of the
Collateral hereunder, the Collateral Agent, as agent of and on behalf
of the U.K. Company and the Trust, will obtain (1) a valid first
priority, perfected and enforceable security interest in, and a first
lien on, such Collateral subject to no other Lien, securing the
redemption obligations of the Jersey Subsidiary under the Jersey
Preference Shares; and (2) a valid and enforceable security interest in
such Collateral subject to no other Lien (other than the Lien described
in the previous clause), securing the obligations of the Jersey
Subsidiary under the ADSs Purchase Contract, and, in each case, none of
such Collateral is or shall be pledged by such Pledgor as collateral
for any other purpose; and
(viii) such Pledgor is presently solvent under its jurisdiction of
incorporation and able to pay, and is paying, its debts as they come
due, and anticipates that it will continue to be able to pay its debts
as they come due for the foreseeable future.
(b) Representations and Warranties of Collateral Agent. On a continuing
basis during the term of this Agreement, the Collateral Agent represents and
warrants to the Pledgors and to the Trust as follows:
12
(i) the Collateral Agent is a banking corporation, duly incorporated,
validly existing and in good standing under the laws of the
jurisdiction of its incorporation and has all corporate powers and all
material governmental licenses, authorizations, consents and approvals
required to enter into, and perform its obligations under, this
Agreement;
(ii) the execution, delivery and performance by the Collateral Agent of
this Agreement have been duly authorized by all necessary corporate
action on the part of the Collateral Agent (no action by the
shareholders of the Collateral Agent being required) and do not and
will not violate, contravene or constitute a default under any
provision of applicable law or regulation or of the charter or by-laws
of the Collateral Agent or of any material agreement, judgment,
injunction, order, decree or other instrument binding upon the
Collateral Agent; and
(iii) this Agreement has been duly and properly executed and delivered
by the Collateral Agent and constitutes a legal, valid and binding
agreement of the Collateral Agent enforceable against the Collateral
Agent in accordance with its terms, except as the enforcement of rights
and remedies may be limited by bankruptcy, insolvency, reorganization,
moratorium, or other similar laws now or hereafter in effect relating
to creditors' rights, and general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or
at law).
9. The Collateral Agent.
(a) Appointment of Collateral Agent. Each of the Trust and the U.K.
Company hereby appoints and designates the Collateral Agent as its agent and
custodian for the purposes set forth herein, and the Collateral Agent does
hereby accept such appointment under the terms and conditions set forth herein.
(b) Duties of Collateral Agent. The Collateral Agent undertakes to
perform only such duties as are expressly set forth herein. The duties and
responsibilities of the Collateral Agent hereunder shall be determined solely by
the express provisions of this Agreement and no other or further duties or
responsibilities shall be implied.
(c) Compensation. For its services in performing its duties set forth
herein, the Collateral Agent shall receive such compensation as may be agreed to
separately by the parties hereto.
(d) Reliance. Subject to the limitations, covenants and provisions
hereof, the Collateral Agent may rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon the face of any note,
notice, resolution, consent, certificate, affidavit, letter, telegram,
statement, order or other document furnished to it hereunder by the Trust or the
Pledgors and believed by it in good faith to be genuine and to have been signed
or presented by the proper party or parties, and shall have no responsibility
for determining the accuracy thereof.
(e) Liability of Collateral Agent. Neither the Collateral Agent nor any
of its directors, officers or employees shall be liable for any action taken or
omitted by it hereunder except in the case of its willful misfeasance, bad
faith, gross negligence or reckless disregard of its duties hereunder or its
failure to use reasonable care with respect to the custody, safekeeping
13
and physical preservation of the Collateral in its possession. The Collateral
Agent may consult with counsel of its own choice, including in-house counsel,
and shall have full and complete authorization and protection for any action
taken or omitted by it hereunder in good faith and in accordance with the
opinion of such counsel. The Collateral Agent shall not be liable with respect
to any action taken, suffered or omitted by it in good faith (i) reasonably
believed by it to be authorized or within the discretion or rights or powers
conferred on it by this Agreement or (ii) in accordance with any direction or
request of the Trustees. In no event shall the Collateral Agent be personally
liable for any taxes or other governmental charges imposed upon or in respect of
(i) the Collateral or (ii) the income or other distributions thereon. Except as
specifically provided herein, the Collateral Agent shall not be responsible for
the validity, sufficiency, collectibility or marketability of any Collateral
Delivered to or held by it hereunder or for the validity or sufficiency of the
Lien (or the priority thereof) on the Collateral purported to be created hereby.
In no event shall the Collateral Agent be liable for punitive, exemplary,
indirect or consequential damages. Except as specifically set forth herein or
contemplated hereby, the Collateral Agent shall have no duty (a) to see to any
recording, filing or depositing of this Agreement or any agreement referred to
herein or therein or any financing statement or continuation statement
evidencing a security interest, or to see to the maintenance of any such
recording or filing or depositing or to any rerecording, refiling or
redepositing of any thereof, (b) to see to the maintenance of any insurance or
(c) to see to the payment or discharge of any tax, assessment, or other
governmental charge or any lien or encumbrance of any kind owing with respect
to, assessed or levied against, any part of the Collateral. The Collateral Agent
shall not be accountable for the use or application by the Trust of any of the
proceeds of the Collateral.
(f) Risk of Funds. No provision of this Agreement shall require the
Collateral Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it.
(g) Use of Sub-Agents or Attorneys. The Collateral Agent may perform
any duties hereunder either directly or by or through financial intermediaries,
agents or attorneys, provided that the Collateral Agent shall remain liable to
fulfill all of such duties to the same extent, and with the same protections, as
if the Collateral Agent was performing them itself.
(h) Recitals and Statements. The Collateral Agent shall not be
responsible for the correctness of the recitals and statements herein which are
made by the Trust and the Pledgors or for any statement or certificate delivered
by the Pledgors pursuant hereto.
(i) Knowledge. The Collateral Agent shall not be deemed to have
knowledge of any Event of Default, unless and until a Responsible Officer of the
Collateral Agent shall have actual knowledge thereof or shall have received
written notice thereof.
(j) Merger. Any corporation or association into which the Collateral
Agent may be converted or merged or with which it may be consolidated, or any
corporation or association resulting from any such conversion, merger or
consolidation to which it is a party, shall be and become a successor Collateral
Agent hereunder and vested with all of the title to the Collateral and all of
the powers, discretions, immunities, privileges and other matters as was its
predecessor
14
without, the execution or filing of any instrument or any further act, deed or
conveyance on the part of any of the parties hereto, provided that such
corporation or association meets the requirements set forth in Section 9(m)(2)
hereof and in the Trust Agreement.
(k) Resignation of Collateral Agent. The Collateral Agent may resign
and be discharged from its duties or obligations hereunder by giving sixty (60)
days' prior notice in writing of such resignation to the Trust and the Pledgors;
provided, however, that except as expressly provided in the last sentence of
this Section 9(k), the Collateral Agent shall continue to act as Collateral
Agent hereunder until a successor Collateral Agent has been appointed as
provided herein and shall have accepted such appointment. Such resignation shall
take effect upon the appointment of a successor Collateral Agent by the Trust.
If, within 30 days after notice by the Collateral Agent to the Trust and the
Pledgors of the Collateral Agent's resignation, no successor Collateral Agent
shall have been appointed and accepted the duties of the Collateral Agent as
provided herein, the Collateral Agent may apply to a court of competent
jurisdiction for the appointment of a successor Collateral Agent.
(l) Removal. The Collateral Agent may be removed at any time by an
instrument or concurrent instruments in writing delivered to the Collateral
Agent and to the Pledgors and signed by the Trust.
(m) Appointment of Successor.
(1) If the Collateral Agent hereunder shall resign or be
removed, or be dissolved or shall be in the course of
dissolution or liquidation or otherwise become incapable of
action hereunder, or if it shall be taken under the control of
any public officer or officers or of a receiver appointed by a
court, a successor may be appointed by the Trust by an
instrument or concurrent instruments in writing signed by the
Trust or by its attorneys in fact fully authorized. A copy of
such instrument or concurrent instruments shall be sent by
registered mail to the Pledgors.
(2) Every such temporary or permanent successor Collateral
Agent appointed pursuant to the provisions hereof shall be a
trust company or bank in good standing, having a reported
capital and surplus of not less than $100,000,000 and capable
of holding the Collateral in the State of New York, if there
be such an institution willing, qualified and able to accept
the duties of the Collateral Agent hereunder upon customary
terms.
(n) Acceptance by Successor. Every temporary or permanent successor
▇▇▇▇▇▇▇▇▇▇ Agent appointed hereunder shall execute, acknowledge and deliver to
its predecessor and also to the Pledgors an instrument in writing accepting such
appointment hereunder, whereupon such successor, without any further act, deed
or conveyance, shall become fully vested with all the estates, properties,
rights, powers, duties and obligations of its predecessors. Such predecessor
shall, nevertheless, on the written request of its successor or the Pledgors,
execute and deliver an instrument transferring to such successor all the
estates, properties, rights and powers of such predecessor hereunder. Every
predecessor Collateral Agent shall deliver all Collateral held by it as the
Collateral Agent hereunder to its successor. Should any instrument in writing
from the
15
Pledgors be required by a successor Collateral Agent for more fully and
certainly vesting in such successor the estates, properties, rights, powers,
duties and obligations hereby vested or intended to be vested in the
predecessor, any and all such instruments in writing shall, at the request of
the temporary or permanent successor Collateral Agent, be forthwith executed,
acknowledged and delivered by the Pledgors.
10. Miscellaneous.
(a) Amendments, Etc. Any amendment or modification of any provision of
this Agreement shall be in writing and expressly approved in writing by the
parties hereto. Any terms and conditions of this Agreement may be waived in
writing at any time by the party or parties entitled to the benefits of such
terms and conditions. Any waiver shall be effective only for the specific
purpose for which given and for the specific time period, if any, contemplated
therein. A waiver of any of the terms and conditions of, or rights under, this
Agreement on one occasion shall not constitute a waiver of the other terms and
conditions of, or rights under, this Agreement, or of such terms and conditions
or rights on any other occasion.
(b) Notices and Other Communications. All notices and other
communications shall be directed as follows (or to such other address for a
particular party as shall be specified by such party in a like notice given
pursuant to this Section 10(b)):
Pledgors: Cuzzano (Investments) Limited
Templar House, Don Road
St. Helier, Jersey JE4 8WH
British Channel Islands
Telecopier: 44 1534 500 450
Attention: Company Secretary
Cuzzano (U.K.) Company
One Silk Street
London EC2Y8HQ
Telecopier: ▇▇-▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Collateral Agent: The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
16
Trust: c/o Puglisi & Associates
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 19715
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Except as otherwise specifically provided herein, all notices and other
communications provided for hereunder shall be in writing and shall be deemed to
have been duly given if either (i) personally delivered (including delivery by
courier service or by Federal Express or any other nationally recognized
overnight delivery service for next day delivery in the United States) to the
offices set forth above, in which case they shall be deemed received on the
first Business Day by which delivery shall have been made to said offices, (ii)
transmitted by any standard form of telecommunication to the offices set forth
above, in which case they shall be deemed received on the first Business Day by
which a standard confirmation that such transmission occurred is received by the
transmitting party (unless such confirmation states that such transmission
occurred after 5:00 P.M. on such first Business Day, in which case delivery
shall be deemed to have been received on the immediately succeeding Business
Day), or (iii) sent by certified mail, return receipt requested to the offices
set forth above, in which case they shall be deemed received when receipted for
unless acknowledgment of receipt is refused (in which case delivery shall be
deemed to have been received on the first Business Day on which such
acknowledgment is refused).
(c) Waivers. No failure or delay by any party hereto in exercising any
rights, power or privilege hereunder shall operate as a waiver thereof.
(d) Non-Assignment. No party hereto shall have the right to assign
their rights or obligations hereunder to any other person without the prior
written consent of the other parties.
(e) Waiver of Jury Trial. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
THE PARTIES HERETO HEREBY WAIVE AND COVENANT THAT THEY WILL NOT ASSERT (WHETHER
AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN
RESPECT OF ANY ISSUE, CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING OUT OF OR
BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF, IN EACH CASE WHETHER NOW
EXISTING OR HEREAFTER ARISING OR WHETHER IN CONTRACT OR TORT OR OTHERWISE. EACH
PARTY HERETO HEREBY ACKNOWLEDGES THAT IT HAS BEEN INFORMED THAT THE PROVISIONS
OF THIS SECTION CONSTITUTE A MATERIAL INDUCEMENT UPON WHICH THE OTHER PARTIES
HERETO HAVE RELIED, ARE RELYING AND WILL RELY IN ENTERING INTO THIS AGREEMENT
AND ANY DOCUMENT RELATED THERETO. EACH PARTY HERETO MAY FILE AN ORIGINAL
COUNTERPART OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF
THE OTHER PARTIES HERETO TO THE WAIVER OF THEIR RESPECTIVE RIGHTS TO TRIAL BY
JURY.
17
(f) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED WHOLLY WITHIN SUCH STATE; PROVIDED THAT AS TO COLLATERAL
LOCATED IN ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK, THE COLLATERAL
AGENT ON BEHALF OF THE U.K. COMPANY AND THE TRUST SHALL HAVE ALL OF THE RIGHTS
TO WHICH A SECURED PARTY IS ENTITLED UNDER THE LAWS OF SUCH OTHER JURISDICTION.
(g) Headings. The headings herein are for the convenience of reference
only and shall not affect the meaning or construction of any provision hereof.
(h) Entire Agreement. This Agreement contains the entire agreement
between the parties relating to the subject matter hereof and supersede all oral
statements and prior writings with respect thereto.
(i) Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed for
all purposes an original, but all such counterparts shall constitute but one and
the same instrument.
(j) Force Majeure. None of the Pledgors, the Collateral Agent or the
Trust shall be responsible for delays or failures in performance resulting from
acts beyond its control. Such acts shall include but not be limited to acts of
God, strikes, lockouts, riots, acts of war, epidemics, governmental regulations
superimposed after the fact, fire, power failures, computer viruses, earthquakes
or other disasters.
(k) Binding Effect. This Agreement shall be binding upon the respective
parties hereto and their respective successors and assigns. All the covenants
and agreements herein contained by or on behalf of the Pledgors and the
Collateral Agent shall be enforceable by and inure to the benefit of the Trust
and its successors and assigns.
(l) Separability. To the extent permitted by law, the unenforceability
or invalidity of any provision or provisions of this Agreement shall not render
any other provision or provisions herein contained unenforceable or invalid.
11. Termination of Agreement. This Agreement and the rights hereby granted by
the Pledgors in the Collateral shall cease, terminate and be void upon
fulfillment of all of the obligations of the Jersey Subsidiary under the Jersey
Preference Shares and the ADSs Purchase Contract, and the Pledgors shall have no
further liability hereunder upon such termination.
12. Application of Bankruptcy Code. The parties hereto acknowledge and agree
that the Collateral Agent is a "financial institution" within the meaning of
Section 101(22) of the Bankruptcy Code and is acting hereunder as agent and
custodian for the Trust and that the Trust is a "customer" of the Collateral
Agent within the meaning of said Section 101(22).
13. No Personal Liability of Trustees. By executing and delivering this
Agreement, none of the Trustees assumes, and in no event shall incur, any
personal liability hereunder, other than as expressly provided by law.
18
14. Limitation on Liability. Notwithstanding anything to the contrary contained
herein, no recourse shall be had, whether by levy or execution or otherwise, for
any claim based on this Agreement or in respect hereof against any incorporator,
shareholder or affiliate of the Trust or the Trustees, the Administrator, the
Custodian or the Paying Agent or any predecessor, successor or affiliate of the
Trust and of the aforesaid persons, or any of their assets, or against any
principal, partner, incorporator, shareholder, officer, director, agent or
employee of any of the aforesaid persons, under any rule of law, equitable
principle, statute or constitution, or by the enforcement of any assessment or
penalty, or otherwise, nor shall any of such persons be personally liable for
any such amounts or claims, or liable for any deficiency judgment based thereon
or with respect thereto, and that all such liability of the aforesaid persons is
expressly waived and released as a condition of, and as consideration for, the
execution of this Agreement by the Trust. Notwithstanding anything to the
contrary contained herein, nothing in this Section shall be construed to affect
or limit the Pledgors' obligations under this Agreement.
15. Consent to Jurisdiction. Each Pledgor agrees that any legal suit, action or
proceeding brought by the Trust or the Collateral Agent or by any person
controlling the Trust or the Collateral Agent, arising out of or based upon this
Agreement may be instituted in any State or Federal court in the Borough of
Manhattan, City and State of New York, and, to the fullest extent permitted by
law, waives any objection which it may now or hereafter have to the laying of
venue of any such proceeding, and irrevocably submits to the non-exclusive
jurisdiction of such court in any suit, action or proceeding. Each Pledgor has
appointed CT Corporation System as its authorized agent (the "Authorized Agent")
upon which process may be instituted in any State or Federal court in the
Borough of Manhattan, City and State of New York by the Trust or the Collateral
Agent and expressly accepts the jurisdiction of any such court in respect of
such action. Such appointment shall be irrevocable unless and until this
Agreement is terminated or a successor authorized agent, located or with an
office in the Borough of Manhattan, City and State of New York, shall have been
appointed by such Pledgor and such appointment shall have been accepted by such
successor authorized agent. Such Pledgor represents and warrants that CT
Corporation System has agreed to act as said agent for service of process, and
such ▇▇▇▇▇▇▇ agrees to take any and all action, including the filing of any and
all documents and instruments, that may be necessary to continue such
appointment in full force and effect as aforesaid. Service of process upon the
Authorized Agent and written notice of such service to such Pledgor shall be
deemed, in every respect, effective service of process upon such Pledgor.
16. Judgement Currency. Each Pledgor hereby agrees to indemnify the Trust and
the Collateral Agent against any loss incurred by the Trust or the Collateral
Agent as a result of any judgment or order being given or made for any amount
due hereunder and such judgment or order being expressed and paid in a currency
(the "Judgment Currency") other than U.S. dollars and as a result of any
variation as between (i) the rate of exchange at which the U.S. dollar amount is
converted into the Judgment Currency for the purpose of such judgment or order,
and (ii) the rate of exchange at which the Trust or the Collateral Agent would
have been able to purchase U.S. dollars with the amount of the Judgment Currency
actually received by such Trust or Collateral Agent had utilized such amount of
Judgment Currency to purchase U.S. dollars as promptly as practicable upon the
receipt by the Trust or the Collateral Agent thereof. The foregoing indemnity
shall constitute a separate and independent obligation of the Pledgor and shall
continue in full force and effect notwithstanding any such judgment or order as
aforesaid. The term "rate of exchange" shall include and allowance for any
customary or reasonable or
19
premium and costs of exchange payable in connection with the purchase of, or
conversion into, the relevant currency.
17. Waiver of Immunities. To the extent such Pledgor or any of its properties,
assets or revenues may have or may hereafter become entitled to, or have
attributed to it, any right of immunity, on the grounds of sovereignty or
otherwise, from any legal action, suit or proceeding, from set-off or process,
from attachment upon or prior to judgment, from attachment in aid of execution
of judgment, or from execution of judgment, or other legal process or proceeding
for the giving of any relief or for the enforcement of any judgment, in any
jurisdiction in which proceedings may at any time be commenced, with respect to
its obligations, liabilities or any other matter under or arising out of or in
connection with this Agreement, such Pledgor hereby irrevocably and
unconditionally, to the extent permitted by applicable law, waives, and agrees
not to plead or claim, any such immunity and consents to such relief and
enforcement.
20
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers or representatives thereunto duly
authorized as of the day and year first above written.
CUZZANO (UK) COMPANY
By:
-------------------------------------
Name:
Title:
CUZZANO (INVESTMENTS) LIMITED
By:
-------------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Collateral Agent
By:
-------------------------------------
Name:
Title:
NAB EXCHANGEABLE PREFERRED TRUST
By:
-------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Managing Trustee
21
Exhibit A
---------
CONTROL AGREEMENT
This Control Agreement dated as of September __, 1998 among NAB
Exchangeable Preferred Trust, a business trust created pursuant to the Business
Trust Act of the State of Delaware (Chapter 38, Title 12, of the Delaware Code,
12 Del. C. (Sections 3801 et seq.)) (such trust and the trustees thereof acting
in their capacity as such being referred to herein as the "Trust"), Cuzzano (UK)
Company, a special purpose company with unlimited liability incorporated under
the laws of, and domiciled in, the United Kingdom (the "U.K. Company"), Cuzzano
(Investments) Limited, a company incorporated with limited liability under the
laws of, and domiciled in, Jersey, the Channel Islands (the "Jersey Subsidiary")
(the U.K. Company and the Jersey Subsidiary being sometimes individually
referred to herein as a "Pledgor" and collectively as the "Pledgors"), The Bank
of New York, a New York banking corporation, in its capacities as agent and
custodian for and on behalf of the U.K. Company and the Trust, as applicable
(the "Collateral Agent"). and as securities intermediary (the "Securities
Intermediary"). Capitalized terms used but not defined herein shall have the
meaning assigned in the ADRs Security and Pledge Agreement dated as of September
__, 1998, among the Trust, the U.K. Company, the Jersey Subsidiary and the
Collateral Agent (the "Security Agreement"). All references herein to the "UCC"
shall mean the Uniform Commercial Code as in effect in the State of New York.
Section 1. Establishment of Securities Account. The Securities
Intermediary hereby confirms that (i) the Securities Intermediary has
established account number _______ in the name of the Collateral Agent, as agent
and custodian of the U.K. Company and the Trust (such account and any successor
account the "Securities Account"), (ii) the Securities Account is a "securities
account" as such term is defined in Section 8-501(a) of the UCC, (iii) the
Securities Intermediary shall, subject to the terms of this Agreement, treat the
Trust as entitled to exercise the rights that comprise any financial asset
credited to the account, (iv) all property delivered to the Securities
Intermediary pursuant to the Security Agreement will be promptly credited to the
Securities Account, and (v) all securities or other property underlying any
financial assets credited to the Securities Account shall be registered in the
name of the Securities Intermediary, indorsed to the Securities Intermediary or
in blank or credited to another securities account maintained in the name of the
Securities Intermediary and in no case will any financial asset credited to the
Securities Account be registered in the name of the Pledgors, payable to the
order of the Pledgors or specially endorsed to the Pledgors except to the extent
the foregoing have been specially endorsed to the Securities Intermediary or in
blank.
Section 2. "Financial Assets" Election. The Securities Intermediary
hereby agrees that each item of property (whether investment property, financial
asset, security, instrument or cash) credited to the Securities Account shall be
treated as a "financial asset" within the meaning of Section 8-102(a) (9) of the
UCC.
Section 3. Entitlement Orders. If at any time the Securities
Intermediary shall receive an "entitlement order" (within the meaning of Section
8-102(a)(8) of the UCC) issued by the Collateral Agent on behalf of each Secured
Party and relating to the Securities Account, the
Securities Intermediary shall comply with such entitlement order without further
consent by the Pledgors or any other person.
Section 4: Subordination of Lien; Waiver of Set-Off. In the event that
the Securities Intermediary has or subsequently obtains by agreement, operation
of law or otherwise a security interest in the Securities Account or any
security entitlement credited thereto, the Securities Intermediary hereby agrees
that such security interest shall be subordinate to the security interests of
the Trust created under the Security Agreement. The financial assets and other
items deposited to the Securities Account will not be subject to deduction,
set-off, banker's lien, or any other right in favor of any person other than the
Trust (except that the Securities Intermediary may set off the face amount of
any checks which have been credited to the Securities Account but are
subsequently returned unpaid because of uncollected or insufficient funds).
Section 5. Choice of Law. Both this Agreement and the Securities
Account shall be governed by the laws of the State of New York. Regardless of
any provision in any other agreement, for purposes of the UCC, New York shall be
deemed to be the Securities Intermediary's location and the Securities Account
(as well as the securities entitlements related thereto) shall be governed by
the laws of the State of New York.
Section 6. Conflict with other Agreements. There are no other
agreements entered into between the Securities Intermediary and the Pledgors
with respect to the Securities Account In the event of any conflict between this
Agreement (or any portion thereof) and any other agreement hereafter entered
into, the terms of this Agreement shall prevail.
Section 7. Amendments. No amendment or modification of this Agreement
or waiver of any right hereunder shall be binding on any party hereto unless it
is in writing and is signed by all of the parties hereto.
Section 8. Notice of Adverse Claims. Except for the claims and interest
of the U.K. Company and the Trust in the Securities Account created under the
Security Agreement, the Securities Intermediary does not know of any claim to,
or interest in, the Securities Account or in any "financial asset" (as defined
in Section 8-102(a) of the UCC) credited thereto. If any person asserts any
lien, encumbrance or adverse claim (including any writ, garnishment, judgment,
warrant of attachment, execution or similar process) against the Securities
Account or in any financial asset carried therein, the Securities Intermediary
will promptly notify the Collateral Agent, the Trust and the Pledgors thereof.
Section 9. Maintenance of Securities Account. In addition to, and not
in lieu of, the obligation of the Securities Intermediary to honor entitlement
orders as agreed in Section 3 hereof, the Securities Intermediary agrees to
maintain the Securities Account in accordance with this Section 9. The
Collateral shall be maintained by the Securities Intermediary in a separate
non-commingled account and the Collateral Agent shall use reasonable care with
respect to the custody, safekeeping and physical preservation of the Collateral
in its possession and shall accord the Collateral treatment substantially equal
to that which it accords its own property, it being understood that the
Securities Intermediary in its capacity as such shall not, except as
specifically set forth herein or contemplated hereby, have any responsibility
for (i) ascertaining or taking action with respect to calls, conversions,
exchanges, maturities or other matters relative
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to any Collateral, whether or not the Securities Intermediary has or is deemed
to have knowledge of such matters or (ii) taking any necessary steps to preserve
rights against parties with respect to any Collateral. The Securities
Intermediary shall have no right of offset against the Collateral with respect
to any amounts owed to the Securities Intermediary, whether or not arising under
this Agreement, and the Securities Intermediary hereby waives any such right of
offset that it may otherwise have. Except as specifically provided herein, the
Securities Intermediary covenants and agrees that it will not sell, assign,
transfer, exchange or otherwise dispose of, or grant any option with respect to,
any of the Collateral, nor will it create, incur or permit to exist any Lien or
Transfer Restriction on or with respect to any of the Collateral, any interest
therein, or any proceeds thereof, except as may be created or permitted by this
Agreement or the Security Agreement.
Section 10. Representations, Warranties and Covenants of the Securities
Intermediary. The Securities Intermediary hereby makes the following
representations, warranties and covenants:
(a) The Securities Account has been established as set forth in Section
1 above and the Securities Account will be maintained in the manner set forth
herein until termination of this Agreement. The Securities Intermediary shall
not change the name or account number of the Securities Account without the
prior written consent of the Trust.
(b) No financial asset is or will be registered in the name of the
Pledgors, payable to his order, or specially endorsed to them, except to the
extent such financial asset has been endorsed to the Securities Intermediary or
in blank.
(c) This Securities Account Control Agreement is the valid and legally
binding obligations of the Securities Intermediary.
(d) The Securities Intermediary has not entered into, and until the
termination of the this agreement will not enter into, any agreement with any
other person relating to any of the Securities Account and/or any financial
assets credited thereto pursuant to which it has agreed to comply with
entitlement orders (as defined in Section 8-102(a)(8) of the UCC) of such
person. The Securities Intermediary has not entered into any other agreement
with the Pledgors or the Trust purporting to limit or condition the obligation
of the Securities Intermediary to comply with entitlement orders as set forth in
Section 3 hereof.
Section 11. Successors. The terms of this Agreement shall be binding
upon, and shall inure to the benefit of, the parties hereto and their respective
corporate successors or heirs and personal representatives.
Section 12. Notices. Any notice, request or other communication
required or permitted to be given under this Agreement shall be in accordance
with the notice provisions in the Security Agreement. Notices to the Securities
Intermediary shall be made to the Collateral Agent.
Section 13. Termination. The rights and powers granted herein to the
Trust have been granted in order to perfect its security interests in the
Securities Account, are powers coupled with an interest and will neither be
affected by the bankruptcy of the Pledgors nor by the lapse of
3
time. The obligations of the Securities Intermediary hereunder shall continue in
effect until the security interests of the Trust in the Securities Account has
been terminated pursuant to the terms of the Security Agreement and the Trust
has notified the Securities Intermediary of such termination in writing.
Section 14. Counterparts. This Agreement may be executed in any number
of counterparts, all of which shall constitute one and the same instrument, and
any party hereto may execute this Agreement by signing and delivering one or
more counterparts.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers or representatives thereunto duly
authorized as of the day and year first above written.
CUZZANO (UK) COMPANY
By:
------------------------------------
Name:
Title:
CUZZANO (INVESTMENTS) LIMITED
By:
------------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Collateral Agent
By:
------------------------------------
Name:
Title:
NAB EXCHANGEABLE PREFERRED TRUST
By:
------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Managing Trustee
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Exhibit B
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NOTICE OF PLEDGE
(Cuzzano (Investments)Limited)
[DATE]
To: National Australia Bank Limited
Dear Sirs,
We hereby give you notice that by an agreement dated September __,
1998, Cuzzano (Investments) Limited (the "Jersey Subsidiary") has pledged,
assigned, granted and conveyed unto The Bank of New York ("Collateral Agent") as
agent and custodian for and on behalf of Cuzzano (UK) Company and NAB
Exchangeable Preferred Trust all of the Jersey Subsidiary's right, title and
interest in and to the American Depositary Receipts ("ADRs") evidencing, ______
American Depositary Shares ("ADSs") each representing four fully paid
non-cumulative preference shares, liquidation preference US$12.50 per share (the
"NAB Preference Shares"), issued by National Australia Bank Limited ("NAB")
pledged, assigned and transferred pursuant to the ADRs Security and Pledge
Agreement.
Please acknowledge receipt of this notice and confirm your agreement to
the above instructions, by signing the attached copy of this notice.
Yours faithfully
For and on behalf of
Cuzzano (Investments) Limited
Director