EXHIBIT 4.8
ISSUER PLEDGE AGREEMENT
This ISSUER PLEDGE AGREEMENT, dated as of August 20, 1997 (as the same
may be amended, supplemented or otherwise modified from time to time, this
"Agreement") is made by Isle of Capri Black Hawk L.L.C., a Colorado limited
liability company (the "Pledgor") in favor of IBJ ▇▇▇▇▇▇▇▇ Bank & Trust Company,
a New York banking corporation, having an office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as trustee (in such capacity and together with any successors in
such capacity, the "Trustee") pursuant to the Indenture referred to below.
R E C I T A L S :
A. The Pledgor, Isle of Capri Black Hawk Capital Corp. ("Capital
Corp" and, together with the Pledgor, the "Issuers") and the Trustee are,
contemporaneously with the execution and delivery of this Agreement, entering
into a certain Indenture dated as of August 20, 1997 (as the same may be
amended, supplemented or otherwise modified from time to time, the "Indenture"),
pursuant to which the Issuers are issuing their 13% First Mortgage Notes due
2004 With Contingent Interest (such notes, together with any notes issued in
replacement thereof or in exchange therefor, the "Securities"), in the aggregate
principal amount of $75,000,000.
B. The Pledgor is the legal and beneficial owner of (i) all shares
described in Part I of Schedule 1 hereto and issued by the corporations named
therein (the "Pledged Shares") and (ii) the indebtedness described in Part II of
said Schedule 1 and issued by the obligors named therein (the "Pledged Debt"),
in each case to the extent attributed on such Schedule to the ownership of the
Pledgor.
C. It is a condition precedent to the purchase of the Securities
that the Pledgor shall have executed and delivered this Agreement to the Trustee
for the benefit of the Trustee and the ratable benefit of the holders from time
to time of the Securities (the "Holders," and, together with the Trustee, the
"Secured Parties") to secure the payment and performance of the Obligations (as
hereinafter defined).
A G R E E M E N T :
NOW, THEREFORE, in consideration of the premises and in order to
induce the Trustee to enter into the Indenture and to induce the Holders to
purchase the Securities and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Pledgor hereby
agrees, for the benefit of the Trustee and for the ratable benefit of the
Holders as follows:
SECTION 1. Definitions.
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(a) Capitalized terms used herein but not otherwise defined shall have
the meanings assigned to such terms in the Indenture. Unless the context
indicates otherwise or the terms are otherwise defined herein or in the
Indenture, definitions in
the Uniform Commercial Code as in effect in the State of New York (the
"UCC") apply to words and phrases in this Agreement. The term "Pledgor,"
as used with respect to any Person, includes, without limitation, such
Person, such Person's heirs, successors and assigns, such Person as a
debtor-in-possession, and any receiver, trustee, liquidator, conservator,
custodian or similar party appointed for such Person or all or
substantially all of its assets under any law.
(b) The words "hereof," "herein," "hereto" and "hereunder" and words
of similar import when used in this Agreement shall refer to this Agreement
as a whole and not to any particular provision of this Agreement, and
Section, subsection, Schedule and Annex references are to this Agreement
unless otherwise specified.
(c) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
SECTION 2. Pledge. The Pledgor hereby grants, pledges, assigns and
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transfers to the Trustee, for the Trustee's individual benefit and the ratable
benefit of the Holders, as security for the prompt and complete payment and
performance when due (whether at stated maturity, upon redemption or required
repurchase, by acceleration or otherwise) of all the Obligations, a continuing
first priority security interest in and lien on all of the right, title and
interest of the Pledgor in, to and under the following shares, indebtedness and
other personal property, in each case wherever located, whether now owned or at
any time hereafter acquired by the Pledgor, whether now existing or hereafter
coming into existence, or in which the Pledgor now has or at any time in the
future may acquire any right, title or interest (collectively, the
"Collateral"):
(a) the Pledged Shares, all options, warrants or other rights for the
purchase of any capital stock of any issuer of Pledged Shares now owned or
hereafter acquired by or held in the name of the Pledgor, and any and all
certificates or instruments now or hereafter evidencing any of the
foregoing;
(b) the Pledged Debt and the instruments evidencing the Pledged Debt,
and all interest, cash, instruments and other property from time to time
received, receivable or otherwise distributed in respect of or in exchange
for any or all of the Pledged Debt;
(c) all additional shares of stock of any issuer of the Pledged Shares
or of any other Subsidiary of the Pledgor from time to time acquired by the
Pledgor in any manner (all of which additional shares shall, immediately
and automatically upon such acquisition, be Pledged Shares), and any and
all certificates or instruments now or hereafter evidencing any of the
foregoing;
(d) all additional indebtedness from time to time owed to the Pledgor
and the instruments evidencing such indebtedness (all of which additional
indebtedness shall, immediately and automatically upon its creation, be
Pledged Debt), and all interest, cash, instruments and other property from
time to time received, receivable
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or otherwise distributed in respect of or in exchange for any or all of
such indebtedness;
(e) all voting rights in respect of the Pledged Shares;
(f) all dividends, interest, cash, instruments, securities and other
rights and property from time to time received, receivable or otherwise
distributed in respect of, or issued in exchange for, any or all of the
foregoing; and
(g) all cash and non-cash proceeds of the foregoing;
provided, however, that the foregoing clauses (a) through (f) shall not apply to
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the capital stock of any Foreign Subsidiary (as defined below) to the extent
(and only to such extent) that the application of such clauses would require the
pledge hereunder of more than 65% of each class of the capital stock of any
Foreign Subsidiary. For purposes hereof, the term "Foreign Subsidiary" shall
mean any "controlled foreign corporation" within the meaning of Section 957(a)
of the Internal Revenue Code of 1986, as amended from time to time (the Code"),
as to which the Pledgor is a "United States shareholder" as defined in Section
951(b) of the Code.
SECTION 3. Obligations. This Agreement secures, and the Collateral is
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collateral security for, the payment and performance in full when due (whether
at stated maturity, upon redemption or required repurchase, by acceleration or
otherwise) of all obligations of every type and nature of the Issuers to the
Trustee, any other trustee under any Deed of Trust, or any Holder (including,
without limitation, any and all amounts which may at any time be or become due
and payable and any and all interest accruing after the maturity of the
Securities and interest accruing after the filing of any petition in bankruptcy,
or the commencement of any insolvency, reorganization or like proceeding,
whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding and interest, to the extent permitted by law, on the unpaid
interest), whether direct or indirect, absolute or contingent, due or to become
due, or now existing or hereafter incurred, which may arise under, out of, or in
connection with, the Indenture, the Securities, the Guarantees, this Agreement,
the other Collateral Documents, or any other document made, delivered or given
in connection therewith, in each case whether on account of principal, premium,
interest, fees, Liquidated Damages, indemnities, costs, expenses or otherwise
(including, without limitation, all fees and disbursements of counsel to the
Trustee or to the Holders that are required to be paid by the Pledgor pursuant
to the terms of the Indenture, the Securities, the Guarantees, this Agreement,
any other Collateral Document, or any other document entered into by the
Issuers, or either of them, in connection with any of the foregoing)
(collectively, the "Obligations").
SECTION 4. Maintenance of Perfected Security Interests; Further
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Assurances; Additional Collateral.
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SECTION 4.1 Perfection Maintenance. The Pledgor agrees that it
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shall maintain the security interests created by this Agreement as perfected
first priority
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security interests and shall defend such security interests against the claims
and demands of all persons whomsoever.
SECTION 4.2 Further Assurances. The Pledgor agrees that at any
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time and from time to time, at the sole cost and expense of the Pledgor, the
Pledgor shall promptly, and in any event, in no less than five days, execute,
deliver and, where applicable, file all further instruments and documents,
including, without limitation, blank stock powers and similar documents and all
financing, continuation or amendment statements under the Uniform Commercial
Code in effect in any applicable jurisdiction with respect to the security
interests created hereby, and take all further action that may be necessary or
that the Trustee may reasonably request, for the purpose of obtaining,
maintaining or preserving the full benefits of this Agreement and of the rights
and powers herein granted or for the purpose of creating, preserving, perfecting
or otherwise protecting the liens and security interests created or purported to
be created hereby and the priority thereof. Without limiting the Pledgor's
obligation to make such filings, the Pledgor hereby authorizes the Trustee
(subject to the following sentence) to take all action (including, without
limitation, the filing of any Uniform Commercial Code financing statements or
continuation statements or amendments thereto without the signature of the
Pledgor as set forth in Section 12.5 hereof) which the Trustee may deem
necessary or desirable to perfect or otherwise protect the liens and security
interests created or purported to be created hereunder and to obtain the
benefits of this Agreement. Subject to the Trustee's obligations under the
Indenture during the continuance of an Event of Default, the Trustee shall not
be responsible for perfecting or maintaining the perfection of any security
interest granted to it under this Agreement or for filing, refiling, recording
or rerecording any document, financing statement, notice or instrument in any
public office at any time or times and shall not be responsible for the payment
of any taxes with respect to any property subject to this Agreement.
SECTION 4.3 Additional Collateral. Upon acquisition by the
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Pledgor of any additional Pledged Shares or any additional Pledged Debt, the
Pledgor shall be deemed to grant hereunder, and shall cause to be granted, Liens
thereon and security interests therein to the Trustee, as security for the
Obligations. The Pledgor agrees to take, and to cause to be taken, at its own
cost and expense, such actions as the Trustee shall reasonably deem necessary or
appropriate to create, evidence and perfect such Liens and assure the first
priority of such Liens.
SECTION 5. Representations, Warranties and Covenants. The Pledgor
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hereby represents and warrants to, and covenants and agrees with, the Trustee
(for the benefit of the Trustee and the ratable benefit of the Holders) as
follows:
SECTION 5.1 Title; No Other Liens. The Pledgor is as of the date
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hereof, and, as to Collateral acquired by it from time to time after the date
hereof, the Pledgor will be, the owner of each item of Collateral free and clear
from any and all Liens, claims or other right, title or interest of any person
other than Permitted Liens. With the exception of equity interests in Capital
Corp., Schedule 1 is a complete and correct description of all equity interests
owned by the Pledgor as of the date hereof, including the number and class
thereof and the certificate number evidencing the same. The Pledged Shares
pledged hereunder are duly authorized, validly issued, fully paid, and non-
assessable
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and were not issued in violation of the rights of any Person. No unpaid capital
call or dispute exists with respect to any of the Collateral. None of the
Collateral is subject to any buy-sell, voting trust, transfer restriction,
preferential right to purchase or similar agreement or any option, warrant, put
or call or similar agreement. The delivery at any time by the Pledgor to the
Trustee of Collateral shall constitute a representation and warranty by the
Pledgor under this Agreement that, with respect to such Collateral, the Pledgor
is the sole legal and beneficial owner of such Collateral, and that the matters
set forth in this Section 5.1 are true and correct with respect to such newly-
delivered Collateral. No financing statement or other public notice with
respect to all or any part of the Collateral is on file or of record in any
public office except, (i) financing statements related to Permitted Liens and
(ii) financing statements which have been filed in favor of the Secured Parties
pursuant to this Agreement.
SECTION 5.2 Perfected First Priority Liens. The security
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interests granted pursuant to this Agreement, upon making the filings,
registrations, and recordings and taking the actions set forth on Schedule 2,
(a) constitute perfected security interests in the Collateral in favor of the
Trustee, as collateral security for the Obligations, and (b) are prior to all
other Liens on the Collateral in existence on the date hereof.
SECTION 5.3 Necessary Filings. The filings, registrations,
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recordings and other actions described on Schedule 2 hereto constitute the only
filings, registrations and recordings or deliveries necessary or appropriate to
create, preserve, protect and perfect the security interests granted by the
Pledgor to the Trustee pursuant to this Agreement in respect of the Collateral.
SECTION 5.4 Other Financing Statements. The Pledgor shall not
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execute or authorize or permit to be filed in any public office or elsewhere any
financing statement (or similar statement or instrument of registration under
the law of any jurisdiction) relating to the Collateral, except financing
statements filed or to be filed in respect of Permitted Liens.
SECTION 5.5 Chief Executive Office; Location of Collateral and
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Records. The Pledgor's chief executive office is currently located at ▇▇▇
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▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
SECTION 5.6 Changes in Locations, Names, etc. The Pledgor
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represents that it currently uses no business or trade names, except as set
forth on Schedule 3 hereto. The Pledgor shall not (a) change the location of
its chief executive office from that specified in Section 5.5, (b) change its
name, identity or structure, or (c) change the location where it maintains its
books and records from that specified in Section 5.5, unless (i) it shall have
given the Trustee not less than 45 days' prior written notice of its intention
so to do, clearly describing such new location or name and providing such other
information in connection therewith as the Trustee may reasonably request and
(ii) with respect to such new location or name, the Pledgor shall have taken all
action which is necessary or appropriate or which is reasonably requested by the
Trustee to maintain the perfection and proof of the security interest of the
Trustee for the benefit of the Secured
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Parties in the Collateral granted or purported to be granted hereby and shall
have delivered to the Trustee an Officers' Certificate as to compliance with
this clause (ii).
SECTION 5.7 Delivery of Instruments and Chattel Paper. If any
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amount payable under or in connection with any of the Collateral shall be or
become evidenced by any instrument or chattel paper, such instrument or chattel
paper shall be immediately delivered to the Trustee, duly endorsed in a manner
satisfactory to the Trustee, to be held as Collateral pursuant to this
Agreement.
SECTION 5.8 Information and Inspection. The Pledgor shall (a)
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allow the Trustee to inspect and copy all records relating to the Collateral and
the Obligations; and (b) furnish to the Trustee such information as the Trustee
may reasonably request from time to time with respect to the Collateral, any
distributions thereon, and any proceeds thereof.
SECTION 5.9 Authorization, Enforceability. The Pledgor has the
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requisite power, authority and legal right to grant a security interest in all
the Collateral of the Pledgor pursuant to this Agreement, and this Agreement has
been duly authorized, executed and delivered by, and constitutes the legal,
valid and binding obligation of, the Pledgor, enforceable against the Pledgor in
accordance with its terms.
SECTION 5.10 No Consents. Except for the filings, registrations
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and recordings contemplated in Section 5.3, no consent of any person (including,
without limitation, any stockholders or creditors of the Pledgor) and no
consent, authorization, approval, or other action by, and no notice to or filing
with, any governmental authority or regulatory body or other person is required
(a) for the grant by the Pledgor of a security interest in the Collateral
pursuant to this Agreement, (b) for the perfection or maintenance of such
security interest created hereby, including the first priority nature of such
security interest, or the exercise of rights and remedies provided for herein,
(c) for the enforceability of such security interest against third parties,
including judgment lien creditors, (d) for the authorization, execution,
delivery or performance of this Agreement by the Pledgor, or (e) for the
exercise by the Trustee of the remedies in respect of the Collateral pursuant to
this Agreement.
SECTION 5.11 Collateral. All information set forth herein
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(including, without limitation, the information set forth in the Schedules
annexed hereto) relating to the Collateral is accurate and complete in all
material respects.
SECTION 5.12 Ownership and Control of Collateral. Except as may
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otherwise be permitted by the Indenture, the Pledgor at all times will be the
sole legal and beneficial owner of the Collateral of the Pledgor.
SECTION 5.13 Records of Collateral; Notation on Books and
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Records. The Pledgor shall keep full and accurate books and records relating to
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the Collateral and shall ▇▇▇▇ and cause each issuer of Collateral to ▇▇▇▇
immediately all books and records of issue, registration, and transfer relating
to the Collateral as may be necessary
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or as the Trustee may reasonably require in order to reflect the security
interests granted by this Agreement.
SECTION 5.14 Certain Affirmative Covenants. The Pledgor covenants
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and agrees (a) promptly to deliver to the Trustee all instruments, certificates,
documents, or agreements evidencing any of the Collateral; (b) promptly to
notify the Trustee of any material change in any fact or circumstance warranted
or represented by the Pledgor in this Agreement or in any other writings
furnished by the Pledgor to the Trustee in connection with the Collateral; (c)
promptly to notify the Trustee of any claim, action or proceeding affecting the
Pledgor's title to any of the Collateral or the security interest therein
granted to the Trustee hereunder, and, at the reasonable request of the Trustee,
to appear in and defend, at the Pledgor's expense, any such action or
proceeding; and (d) promptly to pay to the Trustee the amount of all court costs
and reasonable attorneys' fees incurred by the Trustee hereunder. The Pledgor
shall, at its own cost and expense, take any and all actions necessary to defend
the creation, perfection and first priority nature of the Lien granted in favor
of the Trustee against all other Persons and all claims and demands.
SECTION 5.15 Certain Negative Covenants. The Pledgor covenants and
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agrees that it shall not (a) create any other security interest or pledge in,
mortgage or otherwise encumber the Collateral or any part thereof, or permit the
same to be or become subject to any Lien, attachment, execution, sequestration,
other legal or equitable process, or any encumbrance of any kind or character,
or grant any option, warrant, or other rights in the Collateral in favor of any
Person other than the Trustee except for carriers', warehousemen's, mechanics',
materialmen's, repairmen's or other like Liens arising in the ordinary course of
business which secure amounts not overdue for a period of more than 60 days or
which are being contested in good faith by appropriate proceedings; (b) except
as permitted under the Indenture, cause or permit any issuer of Pledged Shares
to authorize and issue any additional capital stock, or take any other action
that would otherwise dilute any of the Collateral; (c) except as permitted under
the Indenture, approve any amendment to the certificate or articles of
incorporation or bylaws (or other organizational or governance document) of the
Pledgor which amendment could reasonably be expected to have a Material Adverse
Effect; (d) except as permitted under the Indenture, permit the merger,
consolidation or dissolution of the Pledgor or (e) except as permitted under the
Indenture, sell, lease, lend, transfer or otherwise dispose of any Collateral in
any manner.
SECTION 5.16 Right to Distributions. So long as no Event of
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Default has occurred and is continuing, the Pledgor shall be entitled to receive
and retain any cash dividends paid in respect of the Pledged Shares pledged by
it hereunder. With respect to any Pledged Shares or other instruments,
investment property or securities constituting a part of the Collateral, the
Trustee shall have authority if an Event of Default shall have occurred and be
continuing, without notice to the Pledgor, either to have the same registered in
the Trustee's name or in the name of a nominee, and, with or without such
registration, to demand of the Pledgor, and to receive and receipt for, any and
all distributions (including any stock or similar dividend or distribution)
payable in respect thereof, whether they be ordinary or extraordinary. If the
Pledgor shall become entitled to receive or shall receive any interest in or
certificate representing (including, without limitation, any interest in or
certificate representing a distribution in connection with any reclassification,
increase, or
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reduction of capital, or issued in connection with any reorganization), or any
option or rights arising from or relating to, any of the Collateral, whether as
an addition to, in substitution of, as a conversion of, or in exchange for any
of the Collateral, or otherwise, the Pledgor agrees to accept the same as the
Trustee's agent and to hold the same in trust on behalf of and for the benefit
of the Trustee, and to deliver the same immediately to the Trustee in the exact
form received, with appropriate undated stock or similar powers, duly executed
in blank, to be held by the Trustee, subject to the terms hereof, as Collateral.
If an Event of Default shall have occurred and be continuing, the Trustee shall
be entitled to all distributions and to any sums paid upon or in respect of any
Collateral, including, without limitation, upon the liquidation, dissolution or
reorganization of the Pledgor, all of which shall be promptly paid to the
Trustee to be held by it as additional collateral security for the Obligations
and/or applied to the Obligations at the discretion of the Trustee. All
distributions paid or distributed in respect of the Collateral which are
received by the Pledgor in violation of this Agreement or the Indenture shall,
until paid or delivered to the Trustee, be held by the Pledgor in trust as
additional Collateral for the Obligations.
SECTION 5.17 Pledged Debt. The Pledged Debt that (i) has been, to
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the best of Pledgor's knowledge, after due inquiry, duly authorized,
authenticated or issued and delivered, is the legal, valid and binding
obligation of the issuers thereof and (ii) is not in default; provided that the
Pledged Debt that is intercompany indebtedness has been duly authorized,
authenticated or issued and delivered and is a legal, valid and binding
obligation of the issuers thereof. The Pledged Debt constitutes all of the
outstanding indebtedness owing to the Pledgor and is outstanding in the
principal amount indicated on Schedule 1.
SECTION 6. Reasonable Care. Beyond the duties set forth in
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Section 12.4 and the exercise of reasonable care in custody thereof, the Trustee
shall have no duty as to the collection of any Collateral in its possession or
control or in the possession or control of any agent or nominee of the Trustee,
or any income thereon or as to the preservation of rights against prior parties
or any other rights pertaining thereto. The Trustee shall be deemed to have
exercised reasonable care in the custody and preservation of the Collateral in
its possession if such Collateral is accorded treatment substantially equivalent
to that which the Trustee, in its individual capacity, accords its own property,
it being understood that the Trustee shall not have responsibility for (i)
maintaining, preserving or protecting any of the Collateral, whether or not the
Trustee or any other Secured Party has or is deemed to have knowledge of any
deterioration, disrepair, neglect or otherwise, or (ii) taking any necessary
steps to preserve rights against any person with respect to any Collateral.
SECTION 7. Rights and Powers of the Trustee
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SECTION 7.1 Remedies upon Default. If an Event of Default shall
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occur, the Trustee may, without liability to the Pledgor and without notice or
demand: obtain from any Person information regarding the Pledgor, or any of the
Pledgor's businesses; require the Pledgor to give to the Trustee possession or
control of any of the Collateral not already in the Trustee's possession and
control; endorse as the Pledgor's agent or attorney-in-fact any instruments or
documents representing proceeds of the Collateral; unless earlier permitted
hereunder, take control of funds generated by the Collateral and any other
proceeds, and exercise all other rights which an owner of such Collateral may
exercise;
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at any time transfer any of the Collateral or evidence thereof into its own name
or that of its nominee; vote any Collateral and exercise any rights with respect
thereto; and demand, collect, convert, redeem, receipt for, settle, compromise,
adjust, ▇▇▇ for, foreclose, or realize upon the Collateral, in its own name for
the benefit of the Holders, or in the name of the Pledgor, as the Trustee may
determine. Neither the Trustee nor the Holders shall be liable for failure to
collect any distribution or other proceeds, or for any act or omission on the
part of the Trustee, its officers, agents, employees, or other representatives,
except gross negligence and willful misconduct. The foregoing rights of the
Trustee shall be in addition to, and not a limitation upon, any right of the
Trustee given by law, elsewhere in this Agreement, or otherwise.
SECTION 7.2 Right of the Trustee to Notify the Pledgor. If an
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Event of Default shall have occurred and be continuing and at such other times
as the Trustee is entitled to receive distributions and other property
constituting Collateral, the Trustee may notify the Pledgor to make payments of
all distributions directly to the Trustee, and the Trustee may take control of
all proceeds of any Collateral. Until the Trustee elects to exercise such right,
if an Event of Default shall have occurred and be continuing, the Pledgor, as
agent of the Trustee, shall collect and segregate all distributions and other
amounts paid or distributed with respect to the Collateral.
SECTION 7.3 Delivery of Receipts to the Trustee. Upon the
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Trustee's demand if an Event of Default shall have occurred and be continuing,
the Pledgor shall deposit, upon receipt and in the form received, with any
necessary endorsement, all payments received as proceeds of or otherwise in
connection with the Collateral, in a special bank account in a bank of the
Trustee's choice over which the Trustee alone shall have power of withdrawal.
The funds in said account shall secure the Obligations. The Trustee is
authorized as, and is hereby appointed, the Pledgor's attorney-in-fact, to make
any endorsement of the Collateral in the Pledgor's name and behalf that the
Pledgor fails to make. Pending such deposit, the Pledgor shall not commingle any
such payments with any of the Pledgor's other funds or property, but shall hold
them separate and upon an express trust for the Trustee. If an Event of Default
shall have occurred and be continuing, the Trustee may from time to time apply
the whole or any part of the funds in the special account against the
Obligations.
SECTION 7.4 Voting Rights. It is expressly understood and agreed
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that the Pledgor may exercise all voting rights to the Collateral unless an
Event of Default shall exist, at which time such voting rights shall transfer to
or be exercised as directed by the Trustee, at its sole discretion; provided,
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however, that no voting or management rights shall be exercised, vote cast,
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consent, waiver, or ratification given, or action taken by the Pledgor which
would be inconsistent with or violate any provision of this Agreement or the
Indenture.
SECTION 7.5 Realization upon Collateral. If an Event of Default
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shall have occurred and be continuing, the Trustee, without notice or demand,
but subject to any limitations or restrictions imposed by applicable law, may
exercise any right of a secured party under the UCC or the Uniform Commercial
Code of any applicable jurisdiction, this Agreement, or otherwise and also may
(i) require the Pledgor to, and the Pledgor hereby
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agrees, to the extent such Collateral is not already in the possession of the
Trustee, that it will at its expense and upon request of the Trustee forthwith,
assemble all or part of the Collateral as directed by the Trustee and make it
available to the Trustee at a place to be designated by the Trustee which is
reasonably convenient to both parties or (ii) without notice, except as
specified below, sell the Collateral or any portion thereof in one or more
parcels at public or private sale, at any of the Trustee's offices or elsewhere,
for cash, on credit or for future delivery, and upon such other terms as the
Trustee may deem commercially reasonable. Unless the Collateral is of a type
customarily sold on a recognized market, the Trustee shall give the Pledgor
reasonable notice of the time and place of any public sale thereof or of the
time after which any private sale or other intended disposition thereof is to be
made. The Pledgor agrees that ten (10) days' advance notice thereof shall
constitute reasonable notice. The Trustee shall not be obligated to make any
sale of Collateral, regardless of notice of sale having been given. The Trustee
may adjourn any public or private sale from time to time by announcement at the
time and place fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was so adjourned. The Trustee shall be
entitled to immediate possession of all books and records maintained by the
Pledgor with respect to the Collateral, and shall have the authority to enter
upon any premises upon which any of the same may be situated and remove the same
therefrom without liability. The Trustee shall apply the net proceeds of any
action taken by it pursuant to this Agreement, after deducting all reasonable
costs and expenses of every kind incurred by the Trustee in connection therewith
or incidental to the care or safekeeping of any of the Collateral or in any way
relating to the Collateral or the rights of the Trustee and the Holders
hereunder, including, without limitation, reasonable attorneys' fees and
disbursements, as provided in Section 8 hereof, and only after such application
and after the payment by the Trustee of any other amount required by any
provision of law, including, without limitation, Section 9-504(1)(c) of the UCC,
need the Trustee account for the surplus, if any, to the Pledgor. To the extent
permitted by applicable law, the Pledgor waives all claims, damages and demands
it may acquire against the Trustee (or any other trustee under any Deed of
Trust) or any Holder arising out of the exercise by them of any rights
hereunder.
SECTION 7.6 Securities and Other Laws; Contractual Restrictions;
----------------------------------------------------
Registration.
------------
(a) Because of the Securities Act of 1933, as amended (the
"Securities Act"), and other laws, including without limitation state "blue
sky" laws, or contractual restrictions or agreements imposed by other
Persons, there may be legal restrictions or limitations affecting the
Trustee in any attempts to dispose of the Collateral and the enforcement of
its rights hereunder. For these reasons, the Trustee is hereby authorized
by the Pledgor, but not obligated, if an Event of Default shall have
occurred and be continuing, to sell or otherwise dispose of any of the
Collateral at private sale, subject to an investment letter, or in any
other manner which will not require the Collateral, or any part thereof, to
be registered in accordance with the Securities Act, or the rules and
regulations promulgated thereunder, or any other law. The Trustee is also
hereby authorized by the Pledgor, but not obligated, to take such actions,
give such notices, obtain such consents, and do such other things as the
Trustee may deem required or appropriate under the Securities Act or other
securities
10
laws or other laws or contractual restrictions or agreements in the event
of a sale or disposition of any Collateral. The Pledgor clearly
understands that the Trustee may in its discretion approach a restricted
number of potential purchasers and that a sale under such circumstances may
yield a lower price for the Collateral than would otherwise be obtainable
if the Collateral were registered and sold in the open market. No sale so
made in good faith by the Trustee shall be deemed to be not "commercially
reasonable" because so made. The Pledgor agrees that in the event the
Trustee shall, if an Event of Default shall have occurred and be
continuing, sell the Collateral or any portion thereof at any private sale
or sales, the Trustee shall have the right to rely upon the advice and
opinion of appraisers and other Persons, which appraisers and other Persons
are acceptable to the Trustee, as to the best price reasonably obtainable
upon such a private sale thereof. In the absence of fraud, such reliance
shall be conclusive evidence that the Trustee handled such matter in a
commercially reasonable manner under applicable law.
(b) If the Trustee shall determine to exercise its right to sell
any or all of the Collateral following an Event of Default, and if in the
opinion of counsel for the Trustee it is necessary, or if in the opinion of
the Trustee it is advisable, to have the Collateral or that portion thereof
to be sold, registered under the provisions of the Securities Act, the
Pledgor will, to the fullest extent it has the capability to do so, execute
and deliver at the Pledgor's expense, all such instruments and documents,
and to do or cause to be done all such other acts and things, as may be
necessary or, in the opinion of the Trustee, advisable to register the
Collateral or that portion thereof to be sold, under the provisions of the
Securities Act and to cause the registration statement relating thereto to
become effective and to remain effective for such period as the Trustee may
deem appropriate to facilitate the sale or other disposition of such
Collateral from the date of the first public offering of the Collateral or
that portion thereof to be sold, and to make all amendments thereto and/or
to the related prospectus which, in the opinion of the Trustee, are
necessary or advisable, all in conformity with the requirements of the
Securities Act. The Pledgor shall use its best efforts to comply with the
provisions of the securities or "blue sky" laws of any jurisdiction which
the Trustee shall designate and to make available to its security holders,
as soon as practicable, an earnings statement which will satisfy the
provisions of the Securities Act and applicable "blue sky" laws.
SECTION 7.7 Convertible Securities. If an Event of Default shall
----------------------
have occurred and be continuing, the Trustee may present for conversion any
Collateral which is convertible into any other instrument, security or cash. The
Trustee shall not have any duty, however, to present for conversion any of the
Collateral, unless it shall have received from the Pledgor detailed written
instructions to that effect at a time reasonably far in advance of the final
conversion date to make such conversion possible and such conversion does not
violate any provisions of the Indenture.
SECTION 7.8 Issuer Liabilities. By taking a security interest in
------------------
the Collateral pursuant to this Agreement, neither the Trustee nor any Holder
assumes, accepts or becomes liable with respect to any debts, liabilities or
obligations of or owed to the issuer of any Collateral.
11
SECTION 8. Application of Proceeds. All cash proceeds received by the
-----------------------
Trustee upon any sale of, collection of, or other realization upon, all or any
part of the Collateral shall be applied as follows:
First: To the payment of all reasonable out-of-pocket
-----
expenses incurred by the Trustee in connection with the sale of, collection
of or other realization upon Collateral, including reasonable attorneys'
fees and disbursements and court costs, if applicable;
Second: To the payment of the Obligations in such order set
------
forth in the Indenture; and
Third: To the extent of the balance (if any) of such
-----
proceeds, to payment to the Pledgor or other Person legally entitled
thereto.
Non-cash proceeds of any disposition by the Trustee of Collateral
available to satisfy the Obligations shall be applied to the Obligations in such
order and in such manner consistent with applicable law as the Trustee in its
discretion shall decide.
SECTION 9. Expenses. The Pledgor will immediately upon demand pay to
--------
the Trustee the amount of any and all reasonable expenses, including the fees
and expenses of the Trustee's counsel and the fees and expenses of any experts
and agents which the Trustee may incur in connection with (a) the collection of
the Obligations, (b) the enforcement and administration of this Agreement, (c)
the custody or preservation of, or the sale of, collection from, or other
realization upon, any of the Collateral, (d) the exercise or enforcement of any
of the rights of the Trustee or any Secured Party hereunder, (e) the failure by
the Pledgor to perform or observe any of the provisions hereof, (f) the
preparation and filing or recording of financing statements and other documents
(including all taxes in connection therewith) in public offices necessary or
desirable, in the Trustee's sole discretion, to maintain a first priority
perfected security interest in the Collateral in favor of the Trustee, (g) the
payment or discharge of any taxes, insurance premiums required under any
Collateral Document or encumbrances with respect to the Collateral, (h)
defending or prosecuting any actions or proceedings arising out of or related to
the transactions to which this Agreement relates, or (i) otherwise protecting,
maintaining or preserving the Collateral and the perfection and priority of the
security interests granted or purported to be granted hereunder, or the
enforcing, foreclosing, retaking, holding, storing, processing, selling or
otherwise realizing upon the Collateral and the Trustee's security interest
therein, whether through judicial proceedings or otherwise. All amounts payable
by the Pledgor under this Section 9 shall be due upon demand and shall be part
of the Obligations. The Pledgor's obligations under this Section 9 shall
survive the termination of this Agreement and the discharge of the Pledgor's
other obligations hereunder.
SECTION 10. Amendments in Writing; No Waiver, Cumulative Remedies;
------------------------------------------------------
Reinstatement.
-------------
SECTION 10.1 Amendments. Subject to the provisions of Article 9
----------
of the Indenture, none of the terms or provisions of this Agreement may be
waived, amended,
12
supplemented or otherwise modified, except by a written instrument executed by
the Pledgor (except as otherwise provided in Section 10.4) and the Trustee;
provided, however, that any provision of this Agreement imposing obligations on
-------- -------
the Pledgor may be waived by the Trustee in a written instrument executed solely
by the Trustee.
SECTION 10.2 No Waiver; Remedies Cumulative. To the maximum
------------------------------
extent permitted by law, no failure on the part of the Trustee to exercise, no
course of dealing with respect to, and no delay on the part of the Trustee in
exercising, any right, power, privilege or remedy hereunder shall operate as a
waiver thereof or constitute an acquiescence to any default or Event of Default;
nor shall any single or partial exercise of any such right, power, privilege or
remedy hereunder preclude any other or future exercise thereof or the exercise
of any other right, power or remedy. A waiver by the Trustee or any Holder of
any right or remedy hereunder on any one occasion shall not be construed as a
bar to any right or remedy which the Trustee or such Holder would otherwise have
on any future occasion. To the maximum extent permitted by law, the remedies
herein provided are cumulative and are not exclusive of any remedies provided by
law.
SECTION 10.3 Reinstatement. In the event the Trustee shall have
-------------
instituted any proceeding to enforce any right, power or remedy under this
Agreement by foreclosure, sale, entry or otherwise, and such proceeding shall
have been discontinued or abandoned for any reason or shall have been determined
adversely to the Trustee, then and in every such case, the Pledgor, the Trustee
and each Holder shall be restored to their respective former positions and
rights hereunder with respect to the Collateral, and all rights, remedies and
powers of the Trustee and the Secured Parties shall continue as if no such
proceeding had been instituted.
SECTION 10.4 Additional Pledgors. Upon the execution and delivery
-------------------
to the Trustee by any Person of an Amendment to Issuer Pledge Agreement
(Additional Pledgor) in substantially the form of Annex I hereto (each, an
"Amendment to Issuer Pledge Agreement (Additional Pledgor)"), which Amendment to
Issuer Pledge Agreement (Additional Pledgor) need not be executed by any other
Pledgor, and the acceptance thereof by the Trustee, such Person shall be and
become a Pledgor hereunder, and each reference in this Agreement to the
"Pledgor" shall include such Person and each reference in the Indenture, the
Securities and any other Collateral Document to the "Pledgor" shall include such
Person.
SECTION 11. Appointment as the Trustee. The actions of the Trustee
--------------------------
hereunder are subject to the provisions of the Indenture. The Trustee shall
have the right hereunder to make demands, to give notices, to exercise or
refrain from exercising any rights, and to take or refrain from taking action
(including, without limitation, the release or substitution of Collateral), in
accordance with this Agreement and the Indenture. The Trustee may resign and a
successor Trustee may be appointed in the manner provided in the Indenture.
Upon the acceptance of any appointment as the Trustee by a successor Trustee,
that successor Trustee shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Trustee under this
Agreement, and the retiring Trustee shall thereupon be discharged from its
duties and obligations under this Agreement. After any retiring Trustee's
resignation, the provisions of this Agreement shall inure to its
13
benefit as to any actions taken or omitted to be taken by it under this
Agreement while it was the Trustee.
SECTION 12. The Trustee Appointed Attorney-in-Fact; Proxy; the
--------------------------------------------------
Trustee May Perform; Duty of the Trustee.
----------------------------------------
SECTION 12.1 The Trustee Appointed Attorney-in-Fact. The Pledgor
--------------------------------------
hereby irrevocably constitutes and appoints the Trustee and any officer or agent
thereof, with full power of substitution, as its true and lawful attorneys-in-
fact with full irrevocable power and authority in the place and stead of the
Pledgor and in the name of the Pledgor or in its own name, for the purpose of
carrying out the terms of this Agreement to take any and all appropriate action
and to execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement, and, without limiting
the generality of the foregoing, the Pledgor hereby gives the Trustee and any
officer or agent of the Trustee the power and right, on behalf of the Pledgor,
without notice to or assent by the Pledgor, to do any or all of the following:
(a) in the name of the Pledgor or its own name, or otherwise, take
possession of and endorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys with respect to
any Collateral and file any claim or take any other action or proceeding in
any court of law or equity or otherwise deemed appropriate by the Trustee
for the purpose of collecting any and all such moneys due with respect to
any Collateral whenever payable;
(b) pay or discharge taxes and Liens levied or placed on or threatened
against the Collateral;
(c) execute, in connection with any sale provided for in Section 7 or
any other sale of Collateral pursuant to this Agreement, any endorsements,
assignments or other instruments of conveyance or transfer with respect to
the Collateral; and
(d) (i) direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Trustee or as the Trustee shall direct; (ii) ask
or demand for, collect, receive payment of and receipt for, any and all
moneys, claims and other amounts due or to become due at any time in
respect of or arising out of any Collateral; (iii) commence and prosecute
any suits, actions or proceedings at law or in equity in any court of
competent jurisdiction to collect all or any of the Collateral and to
enforce any other right in respect of any Collateral; (iv) defend any suit,
action or proceeding brought against the Pledgor with respect to any
Collateral; (v) settle, compromise or adjust any such suit, action or
proceeding and, in connection therewith, to give such discharges or
releases as the Trustee may deem appropriate; (vi) generally, sell,
transfer, pledge and make any agreement with respect to or otherwise deal
with any of the Collateral as fully and completely as though the Trustee
were the absolute owner thereof for all purposes, and do, at the Trustee's
option and the Pledgor's expense, at any time, or from time to time, all
acts and things which the Trustee deems necessary to protect, preserve or
realize upon the Collateral and the Trustee's
14
and the Holders' security interests therein and to effect the intent of
this Agreement, all as fully and effectively as the Pledgor might do.
The foregoing grant of authority is a power of attorney coupled with
an interest and such appointment shall be irrevocable until this Agreement is
terminated and the security interests created hereby are released. The Pledgor
hereby ratifies all that such attorneys shall lawfully do or cause to be done by
virtue and in accordance with the terms hereof. Anything in this Section to the
contrary notwithstanding, the Trustee agrees that it will not exercise any
rights under the power of attorney provided for in this Section unless an Event
of Default shall have occurred and be continuing.
SECTION 12.2 Proxy. The Pledgor hereby irrevocably grants to the
-----
Trustee the Pledgor's proxy (exercisable if an Event of Default shall have
occurred and be continuing) to vote any Collateral. The proxy granted, and each
stock power and similar power now or hereafter granted (including any evidenced
by a separate writing), are coupled with an interest and shall be irrevocable
until this Agreement is terminated and the security interests created hereby are
released.
SECTION 12.3 The Trustee May Perform. If the Pledgor shall fail
-----------------------
to do any act or thing that it has covenanted to do hereunder or under the
Indenture or if any warranty on the part of the Pledgor contained herein or
under the Indenture shall be breached, the Trustee or any Secured Party may (but
shall not be obligated to), after providing the Pledgor with at least five
Business Days' notice, do the same or cause it to be done or remedy any such
breach, and may expend funds for such purpose. Any and all amounts so expended
by the Trustee or such Secured Party shall be paid by the Pledgor promptly upon
demand therefor, with interest at the Default Rate during the period from and
including the date on which such funds were so expended to the date of
repayment. The Pledgor's obligations under this Section 12.3 shall survive the
termination of this Agreement and the discharge of the Pledgor's other
obligations under this Agreement.
SECTION 12.4 Duty of the Trustee. The Trustee's sole duty with
-------------------
respect to the custody, safekeeping and physical preservation of the Collateral
in its possession, under Section 9-207 of the UCC, Section 6 hereof or
otherwise, shall be to deal with it in the same manner as the Trustee deals with
similar property for its own account. Neither the Trustee, any Holder nor any
of their respective officers, directors, employees or agents shall be liable for
failure to demand, collect or realize upon any of the Collateral or for any
delay in doing so or shall be under any obligation to sell or otherwise dispose
of any Collateral upon the request of the Pledgor or any other person or to take
any other action whatsoever with regard to the Collateral or any part thereof.
The powers conferred on the Trustee and the Holders hereunder are solely to
protect the Trustee's and the Holders' interests in the Collateral and shall not
impose any duty upon the Trustee or any Holder to exercise any such powers. The
Trustee and the Holders shall be accountable only for amounts that they actually
receive as a result of the exercise of such powers, and neither they nor any of
their officers, directors, employees or agents shall be responsible to the
Pledgor for any act or failure to act hereunder, except for their own gross
negligence or willful misconduct. Except for the safe custody of any Collateral
in its possession and the accounting for moneys actually received by it
hereunder, the Trustee shall have no duty as to
15
any Collateral, as to ascertaining or taking action with respect to calls,
conversions, exchanges, maturities, tenders or other matters relative to any
Collateral, whether or not the Trustee has or is deemed to have knowledge of
such matters, or as to the taking of any necessary steps to preserve rights
against prior parties or any other rights pertaining to reasonable care in the
custody and preservation of any Collateral in its possession if such Collateral
is accorded treatment substantially equal to that which the Trustee accords its
own property. Except as provided in this Section 12.4, the Trustee shall not
have any duty or liability to protect or preserve any Collateral or to preserve
rights pertaining thereto. Nothing contained in this Agreement shall be
construed as requiring or obligating the Trustee or the Holders, and neither the
Trustee nor the Holders shall be required or obligated, to (a) present or file
any claim or notice or take any action, with respect to any Collateral or in
connection therewith or (b) notify the Pledgor of any decline in the value of
any Collateral.
SECTION 12.5 Execution of Financing Statements. Pursuant to
---------------------------------
Section 9-402(2)(e) of the UCC, the Pledgor authorizes the Trustee (subject to
the last sentence of Section 4.2) to file financing statements and continuation
statements with respect to the Collateral without the signature of the Pledgor
in such form and in such filing offices as the Trustee determines appropriate to
perfect the security interests of the Trustee under this Agreement. A carbon,
photographic or other reproduction of this Agreement shall be sufficient as a
financing statement for filing in any jurisdiction.
SECTION 12.6 Authority of the Trustee. The Pledgor acknowledges
------------------------
that the rights and responsibilities of the Pledgor under this Agreement with
respect to any action taken by the Trustee or the exercise or non-exercise by
the Trustee of any option, voting right, request, judgment or other right or
remedy provided for herein or resulting or arising out of this Agreement shall,
as between the Trustee and the Holders, be governed by the Indenture and by such
other agreements with respect thereto as may exist from time to time among them,
but, as between the Trustee and the Pledgor, the Trustee shall be conclusively
presumed to be acting as agent for the Holders with full and valid authority so
to act or refrain from acting, and the Pledgor shall be under no obligation, or
entitlement, to make any inquiry respecting such authority. The Trustee may
exercise its rights under this Agreement through an agent or other designee.
SECTION 13. Notices. All notices, requests, demands and other
-------
communication shall be given in the manner set forth in Section 11.2 of the
Indenture and shall be given or delivered to any party at its address specified
pursuant to the Indenture or at such other address or, facsimile or telephone
number or to the attention of such other individual or department as the party
to which such information pertains may hereafter specify for the purpose in a
notice to the other specifically captioned "Notice of Change of Address."
SECTION 14. Continuing Security Interest; Assignment. This Agreement
----------------------------------------
shall create a continuing security interest in the Collateral and shall (a) be
binding upon the Pledgor, its successors and assigns, and (b) inure, together
with the rights and remedies of the Trustee hereunder, to the benefit of the
Trustee (and, to the extent provided herein, any other trustee under a Deed of
Trust) and the other Secured Parties and each of their respective successors,
transferees and assigns; and no other Persons (including, without
16
limitation, any other creditors of the Pledgor) shall have any interest herein
or any right or benefit with respect hereto. Without limiting the generality of
the foregoing clause (b), any Secured Party may assign or otherwise transfer any
Security or Guarantee held by it secured by this Agreement to any other person,
and such other person shall thereupon become vested with all the benefits in
respect thereof granted to such Secured Party, herein or otherwise, subject
however, to the provisions of the Indenture.
SECTION 15. Release of Collateral. Reference is hereby made to
---------------------
Article 10 of the Indenture for provisions which discuss the release of the
Collateral from the Liens created by this Agreement.
SECTION 16. Termination. When all Obligations have been paid in
-----------
full, this Agreement shall terminate (except as to those provisions which it is
provided herein shall survive such termination) and the Trustee shall forthwith
cause to be assigned, transferred and delivered, against receipt but without any
recourse, warranty or representation whatsoever, any remaining Collateral and
money received in respect thereof, to or on the order of the Pledgor. The
Trustee shall also execute and deliver to the Pledgor upon such termination such
Uniform Commercial Code termination statements and such other documentation as
shall be reasonably requested by the Pledgor to effect the termination and
release of the security interests in the Collateral.
SECTION 17. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
-------------
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS THEREOF.
SECTION 18. Severability of Provisions. Any provision of this
--------------------------
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
SECTION 19. Other Security. To the extent that the Obligations are
--------------
now or hereafter secured by property other than the Collateral or by the
guarantee, endorsement or property of any other person, then the Trustee shall
have the right in its sole discretion to pursue, relinquish, subordinate, modify
or take any other action with respect thereto, without in any way modifying or
affecting any of the Trustee's or any Holder's rights and remedies hereunder.
SECTION 20. Execution in Counterparts. This Agreement and any
-------------------------
amendments, waivers, consents or supplements hereto may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed to be an original,
but all such counterparts together shall constitute one and the same agreement.
17
SECTION 21. Headings. The Section and subsection headings used in
--------
this Agreement are for convenience of reference only and shall not affect the
construction or interpretation of this Agreement.
SECTION 22. Obligations Absolute. All obligations of the Pledgor
--------------------
hereunder shall be absolute and unconditional irrespective of:
(a) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of either Issuer;
(b) any lack of validity or enforceability of the Indenture, the
Guarantees, the Securities, any other Collateral Document, or any other
agreement or instrument relating thereto;
(c) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations, or any other amendment or
waiver of or any consent to any departure from the Indenture, the
Guarantees, the Securities, any other Collateral Document or any other
agreement or instrument relating thereto (except to the extent specified in
such change, amendment or waiver);
(d) any taking, exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to any
departure from any guarantee, for all or any of the Obligations;
(e) any exercise or non-exercise, or any waiver of any right, remedy,
power or privilege under or in respect of this Agreement, the Indenture,
the Guarantees, the Securities, any other Collateral Document, or any other
agreement or instrument relating thereto, except as specifically set forth
in a waiver granted pursuant to the provisions of the Indenture;
(f) any manner of application of collateral, or proceeds thereof, to
all or any of the Obligations, or any manner of sale or other disposition
of any collateral for all or any of the Obligations or any other
obligations of the Issuers, or either of them, under the Indenture, the
Securities or any other Collateral Document or any other assets of either
Issuer or any of their respective Subsidiaries;
(g) any change, restructuring or termination of the corporate
structure or existence of either Issuer or any of their respective
Subsidiaries;
(h) any failure of the Trustee or any Secured Party to disclose to
either Issuer any information relating to the financial condition,
operations, properties or prospects of the other Issuer now or in the
future known to the Trustee or any other Secured Party (the Pledgor hereby
waiving any duty on the part of the Trustee and any other Secured Party to
disclose such information); or
(i) any other circumstance (including, without limitation, any statute
of limitations) or any existence of or reliance on any representation by
the Trustee or
18
any other Secured Party that might otherwise constitute a defense available
to, or a discharge of, either Issuer, or any guarantor or surety.
SECTION 23. Waiver of Marshaling. The Pledgor for itself and for all
--------------------
persons hereafter claiming through or under it or who may at any time hereafter
become holders of liens junior to the liens granted under this Agreement, hereby
expressly waives and releases all rights to direct the order in which any of the
Collateral shall be sold in the event of any sale or sales pursuant hereto and
to have any of the Collateral and/or any other property now or hereafter
constituting security for any of the obligations secured hereunder marshaled
upon the exercise of any remedies under this Agreement or any other agreement
granting security for the obligations secured hereunder.
SECTION 24. Independence of Covenants. All covenants hereunder shall
-------------------------
be given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or be otherwise within the limitations of, another covenant shall
not avoid the occurrence of a default if such action is taken or condition
exists.
SECTION 25. Savings Clause. It is the intention of the parties to
--------------
conform strictly to the usury laws, whether state or federal, that are
applicable to the transaction of which this Agreement is a part. All agreements
between the Issuers, or either of them, and the Trustee, whether now existing or
hereafter arising and whether oral or written, are hereby expressly limited so
that in no contingency or event whatsoever shall the amount paid or agreed to be
paid by the Issuers for the use, forbearance or detention of the money to be
loaned or advanced under the Indenture, the Securities, the Guarantees, this
Agreement, any other Collateral Document, or any other agreement or instrument
relating thereto, or for the payment or performance of any covenant or
obligation contained herein or therein, exceed the maximum amount permissible
under applicable federal or state usury laws. If under any circumstances
whatsoever fulfillment of any such provision, at the time performance of such
provision shall be due, shall involve exceeding the limit of validity prescribed
by law, then the obligation to be fulfilled shall be reduced to the limit of
such validity. If under any circumstances the Issuers, or either of them, shall
have paid an amount deemed interest by applicable law, which would exceed the
highest lawful rate, such amount that would be excessive interest under
applicable usury laws shall be applied to the reduction of the principal amount
owing in respect of the Obligations and not to the payment of interest, or if
such excessive interest exceeds the unpaid balance of principal and any other
amounts due hereunder, the excess shall be refunded to the Issuers. All sums
paid or agreed to be paid for the use, forbearance or detention of the principal
under any extension of credit or advancement of funds by the Trustee or any
Holder, shall, to the extent permitted by applicable law, and to the extent
necessary to preclude exceeding the limit of validity prescribed by law, be
amortized, prorated, allocated and spread from the date of this Agreement until
payment in full of the Obligations so that the actual rate of interest on
account of such principal amounts is uniform throughout the term hereof.
SECTION 26. Certain Waivers by the Pledgor. The Pledgor waives (a)
------------------------------
any claim that, as to any part of the Collateral, a public sale, should the
Trustee elect so to proceed, is, in and of itself, not a commercially reasonable
method of sale for such
19
Collateral, (b) except as otherwise provided in this Agreement, to the fullest
extent not prohibited by applicable laws, notice or judicial hearing in
connection with the Trustee's disposition of any of the Collateral including any
and all prior notice and hearing for any pre-judgment remedy or remedies and any
such right that the Pledgor would otherwise have under the Constitution or any
statute of the United States or of any state, and all other requirements as to
the time, place and terms of sale or other requirements with respect to the
enforcement of the Trustee's rights hereunder, (c) all rights of redemption,
appraisal or valuation, and (d) all rights and defenses arising out of an
election of remedies by any Secured Party, even though that election of
remedies, such as a nonjudicial foreclosure with respect to security for a
guaranteed obligation, has destroyed the Pledgor's rights of subrogation and
reimbursement against the principal.
SECTION 27. WAIVER OF JURY TRIAL. THE TRUSTEE AND THE PLEDGOR HEREBY
--------------------
WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDINGS INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY
ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT OR THE RELATIONSHIP
ESTABLISHED HEREUNDER.
SECTION 28. Entire Agreement. This written agreement represents the
----------------
final agreement between the parties with respect to the subject matter hereof
and may not be contradicted by evidence of prior, contemporaneous, or subsequent
oral agreements of the parties with respect to the subject matter hereof. There
are no unwritten oral agreements among the parties with respect to the subject
matter hereof.
SECTION 29. Gaming Laws. The terms and provisions of this Agreement,
-----------
including, but not limited to, all rights and remedies of the Trustee and powers
of attorney and appointment, are expressly subject to all laws, statutes,
regulations and orders affecting limited gaming or the sale of liquor
(collectively, the "Gaming Laws"), in the State of Colorado, which may include,
but not be limited to, the necessity for the Trustee to obtain the prior
approval of the regulatory agencies enforcing the Gaming Laws before taking any
action hereunder and to be licensed by such regulatory agencies before
exercising certain rights and remedies hereunder.
20
IN WITNESS WHEREOF, the Pledgor and the Trustee have caused this
Issuer Pledge Agreement to be executed and delivered by their duly authorized
officers as of the date first above written.
ISLE OF CAPRI BLACK HAWK L.L.C.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------
Title: Secretary
---------------------------
By: /s/ H. ▇▇▇▇▇▇ ▇▇▇▇
----------------------------------
Name: H. ▇▇▇▇▇▇ ▇▇▇▇
----------------------------
Title: Vice President
---------------------------
IBJ ▇▇▇▇▇▇▇▇ BANK & TRUST
COMPANY, as Trustee
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Title: Vice President
---------------------------
Acknowledged as to Section 25
ISLE OF CAPRI BLACK HAWK CAPITAL CORP.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Title: Secretary
-------------------------------
SCHEDULE 1
PART I - PLEDGED SHARES
-----------------------
Number and Class of Certificate Percentage
Pledgor Issuer Shares Number(s) Interest
--------------- ------------- -------------------- -------------- -----------
Isle of Capri Isle of Capri 100 shares of Common 1 100%
Black Hawk Black Hawk Stock, No Par Value
L.L.C. Capital
Corp.
PART II - PLEDGED DEBT
----------------------
NONE
A-1
SCHEDULE 2
FILINGS AND REGISTRATIONS
1. UCC-1 Financing Statement describing the Collateral and naming the Pledgor
as debtor and the Trustee as secured party to be filed with the Secretary
of State of the State of Mississippi.
2. UCC-1 Financing Statement describing the Collateral and naming the Pledgor
as debtor and the Trustee as secured party to be filed with the Chancery
Court of the County of ▇▇▇▇▇▇▇▇, in the State of Mississippi.
3. UCC-1 Financing Statement describing the Collateral and naming the Pledgor
as debtor and the Trustee as secured party to be filed with the Secretary
of State of the State of Colorado.
4. UCC-1 Financing Statement describing the Collateral and naming the Pledgor
as debtor and the Trustee as secured party to be filed with the Secretary
of State of the State of New York.
A-2
SCHEDULE 3
BUSINESS OR TRADE NAMES
Pledgor uses the following business or trade names:
(a) Isle of Capri Black Hawk L.L.C.
(b) Isle of Capri
(c) Island Gold
(d) Calypso's
(e) Farraday's
(e) Isle Style
A-3
ANNEX I
FORM OF
AMENDMENT TO ISSUER PLEDGE AGREEMENT
(ADDITIONAL PLEDGOR)
This Amendment to Issuer Pledge Agreement (Additional Pledgor) (this
"AMENDMENT"), dated as of [________ ___, 19__], relates to the Issuer Pledge
----------
Agreement dated as of August __, 1997, as amended, modified and supplemented to
date (as so amended, supplemented or modified, the "AGREEMENT") executed by Isle
---------
of Capri Black Hawk L.L.C., the "PLEDGOR") in favor of IBJ ▇▇▇▇▇▇▇▇ Bank & Trust
-------
Company, as trustee (the "TRUSTEE") for the benefit of the Secured Parties (as
-------
defined in the Agreement).
In compliance with Section 4.17 of the Indenture dated as of August
__, 1997 (as amended, supplemented or otherwise modified from time to time, the
"INDENTURE") among the Pledgor, Isle of Capri Black Hawk Capital Corp. and the
---------
Trustee, [NAME OF SUBSIDIARY] the ("ADDITIONAL PLEDGOR") and the Trustee hereby
------------------
agree as follows (capitalized terms used but not otherwise defined herein shall
have the meanings ascribed to them in the Agreement):
(a) AMENDMENT. The Agreement is hereby amended to add as a party, and
---------
more specifically, as a Pledgor thereunder, the Additional Pledgor.
(b) REPRESENTATIONS AND WARRANTIES. The Additional Pledgor represents
------------------------------
and warrants to the Trustee and each other Secured Party that each of the
representations and warranties of a Pledgor contained in the Agreement is hereby
made by the Additional Pledgor and is true and correct as to the Additional
Pledgor. All capital stock owned or otherwise held by the Additional Pledgor in
each Subsidiary, if any, of the Additional Pledgor is set forth on the
supplement to Schedule 1 to the Issuer Pledge Agreement attached hereto.
(c) GRANT OF SECURITY INTEREST. The Additional Pledgor hereby grants,
--------------------------
pledges, assigns and transfers to the Trustee, for the Trustee's individual
benefit and the ratable benefit of the Holders, as security for the prompt and
complete payment and performance when due (whether at stated maturity, upon
redemption or required repurchase, by acceleration or otherwise) of all the
Obligations, a continuing first priority security interest in and lien on all of
the right, title and interest of the Additional Pledgor, to and under all types
and items of property of the Additional Pledgor within the definition of
Collateral (as defined in the Agreement), in each case wherever located, whether
now owned or at any time hereafter acquired by the Additional Pledgor, whether
now existing or hereafter coming into existence, or in which the Additional
Pledgor now has or at any time in the future may acquire any right, title or
interest.
(d) SCHEDULE SUPPLEMENTS. The Additional Pledgor has attached hereto
--------------------
supplements to Schedules 1 through 3 to the Agreement, and the Additional
Pledgor hereby certifies that such supplements have been prepared by the
Additional Pledgor in substantially the form of the Schedules to the Agreement
and are accurate and complete as of the date first above written.
A-4
(e) ASSUMPTION OF RIGHTS, OBLIGATIONS AND LIABILITIES. The Additional
-------------------------------------------------
Pledgor assumes all of the rights, obligations and liabilities of a Pledgor
under the Agreement and agrees to be bound thereby as if the Additional Pledgor
were an original party to the Agreement. Without limiting the generality of the
foregoing, the Additional Pledgor hereby waives notice of the creation, advance,
increase, existence, extension, or renewal of, or of any indulgence with respect
to, the Obligations; waives presentment, demand, notice of dishonor, and
protest; waives notice of the amount of the Obligations outstanding at any time,
notice of any change in financial condition of the Pledgor or any other
Guarantors, notice of any default or Event of Default, and all other notices
respecting the Obligations (except for any such notices that are required to be
given to such Additional Pledgor pursuant to the other provisions of this
Agreement or the provisions of the Securities, the Indenture or any other
Collateral Document); and agrees that maturity of the Obligations and any part
thereof may be accelerated, extended, or renewed one or more times by the
Holders, in its or their discretion, without notice to such Additional Pledgor.
(f) EFFECTIVENESS. This Amendment shall become effective on the date
-------------
hereof upon the execution hereof by the Additional Pledgor and the Trustee and
delivery hereof to the Trustee.
(g) GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND SHALL BE
-------------
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS THEREOF.
[ADDITIONAL PLEDGOR]
By: ____________________________
Name:
Title:
Address for Notice:
_________________________________
_________________________________
Attn:____________________________
Telephone:_______________________
Telecopy:________________________
IBJ ▇▇▇▇▇▇▇▇ BANK & TRUST COMPANY,
as Trustee
By:______________________________
Name:
Title:
A-5