EXHIBIT 99.7
________________________________________________________________
PARTNERSHIP INTEREST PLEDGE AGREEMENT
between
▇▇▇▇▇ ▇. ▇▇▇▇▇, as Pledgor,
THE ▇▇▇▇▇ ▇. ▇▇▇▇▇ TRUST, as Pledgor,
and
MASTERS FUNDING LLC
Dated as of November 8, 2002
________________________________________________________________
EXECUTION COPY
PARTNERSHIP INTEREST PLEDGE AGREEMENT
This PARTNERSHIP INTEREST PLEDGE AGREEMENT (this "Pledge Agreement"),
dated as of November 8, 2002, is entered into between ▇▇▇▇▇ ▇. ▇▇▇▇▇, an
individual ("DGP") and as Trustee of THE ▇▇▇▇▇ ▇. ▇▇▇▇▇ TRUST dated March 5,
1998 (as amended) ("Trust"; together with DGP referred to sometimes as "Pledgor"
or "Borrower") and MASTERS FUNDING LLC, a Delaware limited liability company
(the "Lender").
RECITALS
A. Pursuant to that certain Credit Support Agreement, dated November 8,
2002 (the "Credit Support Agreement") among Borrowers, the Lender, and GS
Capital Partners 2000, L.P., Whitehall Street Global Real Estate Limited
Partnership, 2001, and SOF-VI U.S. Holdings, LLC, the Lender has agreed to
provide certain credit support to the Borrowers as further described therein.
B. In connection therewith and as a condition to the provision of such
credit support to the Borrowers, Pledgor is required to execute and deliver this
Pledge Agreement, and to grant in favor of the Lender, a continuing security
interest in and lien upon the Collateral (hereinafter defined) to secure the
obligations of the Borrowers under the Credit Support Agreement and the Note (as
defined in the Credit Support Agreement) including any reimbursement obligations
owed to the Lender in connection with any letters of credit or guarantees (the
"Obligations").
C. National Golf Properties, Inc., a Maryland corporation ("NGP"), is a
corporation whose common stock, par value $.01 per share (the "NGP Common
Stock"), is listed on the New York Stock Exchange. NGP is the sole general
partner of National Golf Operating Partnership, L.P., a Delaware limited
partnership ("NGOP", and also referred to herein sometimes as "Issuer"). NGOP
has issued common partnership units (the "NGOP Common Units") that are
exchangeable on a one-for-one basis for NGP Common Stock pursuant to the terms
of the Third Amended and Restated Agreement of Limited Partnership of NGOP dated
July 28, 1999 (the "NGOP Partnership Agreement").
D. None of the Pledged Securities (hereinafter defined) are registered
under applicable securities laws. Concurrently and in connection herewith,
Pledgor will collaterally assign its interests in that certain Unit Exchange and
Registration Rights Agreement, dated July 22, 2002 (the "Registration Rights
Agreement"), by and among Pledgor, American International Golf, Inc. ("AGC") and
NGP to facilitate, upon and in the event of a foreclosure by Lender hereunder,
the exchange of NGOP Common Units into NGP Common Stock and the public sale of
the NGP Common Stock received by the Lender in such exchange.
E. Pledgor is a party to that certain Voting Agreement, dated as of
September 14, 2002, by and among each Equityholder (as defined therein), AGC,
NGP and/or NGOP, and NGP LLC, which requires Lender (as a pledgee) to comply
with certain provisions therein (the "Voting Agreement").
F. In the event of a conflict between the terms of this Pledge Agreement
and the terms of the Credit Support Agreement, the terms of the Credit Support
Agreement shall govern. Capitalized terms used herein and not otherwise defined
herein shall have the meaning given them in the Credit Support Agreement.
NOW, THEREFORE, the parties hereto hereby agree as follows:
AGREEMENT
1. Grant of Security Interest. The Pledgor hereby pledges and grants to the
Lender a first-priority security interest in the property described in Section 2
below (collectively and severally, the "Collateral") and assigns, transfers and
delivers to the Lender the Pledged Securities (defined below), together with the
certificates evidencing the same, which certificates have been duly endorsed in
blank or accompanied by stock, partnership interest or other equity interest
powers duly executed in blank, to secure prompt payment and performance in full
when due, whether at stated maturity, by acceleration or otherwise of all
Obligations.
2. Collateral. The Collateral shall consist of the following:
(a) Pledged Securities. The Collateral includes: (i) 2,148,074 NGOP Common
Units currently owned by the Trust, listed on Exhibit 2 hereto; and (ii) all
new, substituted and additional documents, instruments, securities and general
intangibles issued with respect thereto or in exchange therefor (collectively,
the "Pledged Securities"), and the certificates representing such Pledged
Securities and all now existing and hereafter arising rights of the holder of
such Pledged Securities, including, without limitation, all voting rights and
rights to and interest in all cash and noncash dividends and/or distribution of
any kind and nature and all other property now or hereafter distributable on
account of or received or receivable with respect to any of the foregoing and
all rights of the holders (as such) of the Pledged Securities pursuant to the
NGOP Partnership Agreement.
(b) Proceeds. All proceeds of the foregoing Collateral. For purposes of
this Pledge Agreement, the term "proceeds" has the meaning set forth in Section
9-102(64) of the Uniform Commercial Code.
3. Representations and Warranties. In addition to any representations and
warranties of the Pledgor set forth in the Credit Support Agreement, which are
incorporated herein by this reference, the Pledgor hereby represents and
warrants, on the date hereof and at the time of delivery of any of the
Collateral hereunder, that:
(a) Authority. The Pledgor has full power, authority, and legal right and
has obtained all approvals and consents necessary, to execute, deliver and
perform this Pledge Agreement and the transactions contemplated hereby.
(b) Consents. The Pledgor has obtained all consents, approvals and waivers
from third parties (including governmental entities, if any) relating to the
Pledged Securities necessary to execute and deliver this Pledge Agreement and to
perform his obligations hereunder and the transactions contemplated hereby.
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(c) No Default or Lien. Such execution, delivery and performance will not
contravene, or constitute a default under or result in a lien, except pursuant
hereto, upon the Pledged Securities pursuant to any applicable law or
regulation, or any material contract, agreement, judgment, other decree, or
other instrument binding upon or affecting the Pledgor.
(d) Enforceability of Pledge Agreement. This Pledge Agreement has been duly
executed and delivered and constitutes a legal, valid and binding obligation of
the Pledgor, enforceable against the Pledgor in accordance with its terms
(subject to applicable bankruptcy, insolvency, or similar laws generally
affecting the enforcement of creditors' rights), and this Pledge Agreement
grants to the Lender a valid, first-priority, perfected (subject to delivery of
the certificates representing the Pledged Securities to the Lender) and
enforceable Lien on the Collateral.
(e) Ownership of Collateral. The Pledgor is the sole owner of and has good
and marketable title (but subject to securities law compliance in connection
with any sale of the Pledged Securities) to the Collateral (or, in the case of
after-acquired Collateral, at the time the Pledgor acquires rights in the
Collateral, will be the sole owner thereof) and is (or will be in the case of
after-acquired Collateral) the record, legal and beneficial owner of all the
Pledged Securities, and will at all times be the sole beneficial owner of the
Collateral.
(f) Priority. Except for security interests in favor of the Lender granted
in connection herewith, no person has (or, in the case of after-acquired
Collateral, at the time the Pledgor acquires rights therein, will have) any
right, title, claim or interest (by way of security interest or other lien or
charge) in, against or to the Collateral.
(g) Delivery of Documents, Etc. The Pledgor has delivered to the Lender
certificates representing the Pledged Securities and all instruments, documents,
chattel paper (as said terms are used in the Uniform Commercial Code) and other
items of Collateral in which a security interest is or may be perfected by
possession, together with such additional writings, including, without
limitation, assignments and duly signed undated stock or partnership powers, and
any additional documents with respect thereto as the Lender shall reasonably
request, such documents to be delivered to the Lender on the date hereof.
(h) Pledged Securities. The Pledged Securities consisting of NGOP Common
Units have been duly and validly issued. Other than pursuant to this Pledge
Agreement, and the Registration Rights Agreement, there are no outstanding
options, warrants or other rights to purchase or otherwise acquire the Pledged
Securities or any agreements pursuant to which a third person may acquire the
Pledged Securities from the Pledgor or pursuant to which the Pledgor can acquire
additional securities issuable by NGP or NGOP. The Pledged Securities are not
community property under the laws of the State of California.
(i) Litigation. There are no actions, suits, proceedings, claims or
disputes pending, at law, in equity, in arbitration or before any governmental
authority, against the Pledgor or any of the Pledgor's respective properties (or
to the knowledge of the Pledgor, threatened or contemplated by any governmental
authority against the Pledgor or any of the Pledgor's respective properties)
which purport to affect or pertain to this Pledge Agreement, the Collateral or
any of the transactions contemplated hereby. No injunction, writ, temporary
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restraining order or any order of any nature has been issued by any court or
other governmental authority purporting to enjoin or restrain the execution,
delivery and performance of this Pledge Agreement or directing that the
transactions provided for herein not be consummated as herein provided.
(j) Regulations T, U or X. The Pledge of the Pledged Securities pursuant to
this Pledge Agreement does not violate Regulation T, U or X of the Federal
Reserve Board.
(k) Not "Securities" Under UCC. The Pledged Securities are not "dealt in or
traded on securities exchanges or in securities markets" within the meaning of
Section 8-103 of Title 6 of either of the New York Commercial Code or Delaware
Commercial Code, their terms do not expressly provide that the Pledged
Securities are a security under the provisions of Article 8 of any Uniform
Commercial Code, currently in effect, the Pledged Securities are not held in a
securities account (as defined in the New York Commercial Code or Delaware
Commercial Code), and the Pledged Securities are not an investment company
security (as defined in the New York Commercial Code or Delaware Commercial
Code).
(l) Location of Pledgor. The chief executive office of the Trust is ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and the principal
residence of DGP is ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
4. Covenants and Agreements of Pledgor. In addition to all covenants and
agreements of the Pledgor set forth in this Pledge Agreement and the Credit
Support Agreement, which are incorporated herein by this reference, the Pledgor
hereby agrees:
(a) Preservation of Collateral. To do all acts that may be reasonably
necessary to maintain, preserve and protect the Collateral and to preserve the
Pledgor as sole owner of the Collateral;
(b) Payment of Taxes, Etc. To pay promptly when due all material taxes,
assessments, charges, encumbrances and Liens now or hereafter imposed upon or
affecting any Collateral;
(c) Defense of Litigation. To appear in and defend any action or proceeding
which may materially and adversely affect the Pledgor's title to or the Lender's
interest in the Collateral;
(d) Transfer and Other Liens. (i) Not to sell or contract to sell or
otherwise dispose of, or grant any option, warrant or other right with respect
to, the Collateral and (ii) to keep the Collateral free of all levies and
security interests or other Liens or charges except those approved in writing by
Lender in accordance with the Loan Documents, in each case, except as otherwise
provided in this Pledge Agreement;
(e) Delivery of Collateral. To account fully for and promptly deliver to
the Lender, in the form received, all documents, chattel paper, instruments and
agreements and share or partnership interest certificates (as defined in the New
York Uniform Commercial Code) constituting the Collateral hereunder and subject
to the provisions of paragraph (j) below, all proceeds of the Collateral
received, all endorsed in blank, and, in the case of share or partnership
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interest certificates, accompanied by such partnership interest powers as
appropriate, and until so delivered, all such documents, instruments, agreements
and proceeds to be held by the Pledgor in trust for the Lender, separate from
all other property of the Pledgor and shall be identified as the property of the
Lender;
(f) Further Assurances. To procure, execute and deliver from time to time
any endorsements, notifications, registrations, assignments, financing
statements, and other writings deemed reasonably necessary by the Lender to
perfect, maintain and protect the Secured Parties' security interest in the
Collateral and the priority thereof; and to take such other actions as the
Lender may reasonably request or as is otherwise reasonably necessary to protect
the value of the Collateral and of the Lender's security interest in the
Collateral;
(g) Payment of Costs and Expenses. To reimburse the Lender upon five (5)
days of written demand (which demand shall include a description in reasonable
detail of any costs, expenses, disbursements, charges or fees to be reimbursed)
for any reasonable costs and expenses, including, without limitation, reasonable
attorneys' fees (including the allocated cost of inside counsel), the Lender may
incur while exercising any right, power or remedy provided by this Pledge
Agreement or by law, all of which costs and expenses are included in the
Obligations secured hereby. The Pledgor covenants and agrees to pay the
reasonable fees and expenses of counsel to the Lender in connection with the
negotiation, preparation, development and review of this Pledge Agreement;
(h) Payments on Collateral; Voting. To account fully for and promptly
deliver to the Lender, in the form received, any dividend or any other
distribution on account of the Pledged Securities whether in securities or
property by way of stock-split, spin-off, split-up, reclassification,
combination of shares or the like, or in case of any reorganization,
consolidation or merger. Upon the occurrence and during the continuance of an
Event of Default, the Lender shall be entitled to retain the cash proceeds
received from any permitted disposition of the Pledged Securities and to retain
any dividends or any other distribution lawfully paid by the Issuer on account
of the Pledged Securities and shall have the exclusive right to vote the Pledged
Securities and to execute consents with respect thereto, provided that Lender
complies with Section 2(d) of the Voting Agreement in effect as of the date
hereof. Any and all stock dividends or instruments and other property (other
than cash) received, receivable or otherwise distributed in exchange for, any
Pledged Securities shall be held in trust for the benefit of and pending
delivery to the Lender, be segregated from the other property of the Pledgor,
and be forthwith delivered to the Lender as pledged Collateral in the same form
as received (with any necessary endorsement);
(i) Notices of Changes. To give the Lender 30 days prior written notice of
any change in the Pledgor's chief place of business, residence, legal name,
etc.;
(j) Location of Records. To keep the records concerning the Collateral at
the address set forth below the Pledgor's signature hereof and not to remove
such records from such locations without 30 days prior written notice to the
Lender;
(k) Authorized Action by Lender. The Pledgor hereby agrees that from time
to time, without presentment, notice or demand, and without affecting or
impairing in any way
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the rights of the Lender with respect to the Collateral, the obligations of the
Pledgor hereunder or the Obligations, the Lender shall, but shall incur no
liability to the Pledgor or any third party for failure to, take any action
which the Pledgor is obligated by this Pledge Agreement to do. Any expenses
incurred by the Lender in taking such action shall be payable by the Pledgor.
Upon the occurrence and during the continuance of an Event of Default, the
Pledgor hereby irrevocably appoints the Lender as his attorney-in-fact to
exercise such rights and powers, including without limitation: (i) to collect by
legal proceedings or otherwise and endorse, receive and acknowledge receipt for
all dividends, interest, payments, proceeds, and other sums and property now or
hereafter payable on or on account of the Collateral; (ii) to vote or consent
with respect to the Pledged Securities in accordance with Section 6(d) below;
(iii) to enter any extension, reorganization, deposit, merger, consolidation or
other agreement pertaining to, or deposit, surrender, accept, hold or apply
other property in exchange for the Collateral; and (iv) to make any compromise
or settlement, to pay or discharge taxes, liens, security interests or other
encumbrances and take any action it deems advisable, with respect to the
Collateral. To permit the Lender to exercise such voting and consensual rights,
to collect, endorse and receive such dividends, interest, payments, proceeds and
other sums and property, the Pledgor shall, if necessary, upon written request
of the Lender, from time to time, deliver (or cause to be executed and
delivered) to the Lender all such proxies, dividend payment orders and other
instruments as the Lender may reasonably require; and
(l) Amendment of the NGOP Partnership Agreement. Not to vote for or consent
to, and to vote against, any amendment of the NGOP Partnership Agreement or the
charter of NGOP which is reasonably likely to result in a material adverse
effect on the Collateral or the security interest granted Lender hereunder.
5. Limited Recourse. The provisions of Section 5.6 of the Credit Support
Agreement are hereby incorporated herein by this reference as if herein set
forth in full, MUTATIS MUTANDIS.
6. Remedies. Upon the occurrence and continuance of an Event of Default,
the Lender may upon at least 10 days' written notice to the Pledgor (which the
Pledgor agrees is reasonable notice) and in addition to all further rights and
remedies, if any, available to the Lender under any other agreement, do any one
or more of the following:
(a) General Enforcement. Foreclose or otherwise enforce the Lender's
security interest in any manner permitted by law, or provided for in this Pledge
Agreement.
(b) Sale Etc. Sell or otherwise dispose of any Collateral at one or more
public or private sales at the Lender's place of business or any other place or
places, including, without limitation, any brokers' board or securities
exchange, for cash or credit or other property, for immediate or future
delivery, and at such price and on such terms and in such manner as the Lender
may determine; provided, that if the Lender determines to exercise its rights by
exercising its rights under the Registration Rights Agreement, (1) NGP shall
have filed a Registration Statement on Form S-3 (the "Shelf Registration
Statement") pursuant to the Registration Rights Agreement covering the total
amount of Pledged Securities hereunder, (2) such Shelf Registration Statement
has been declared effective on or prior to the date of the intended foreclosure
sale for which 10 days' written notice was provided by the Lender to the
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Pledgor,(3) notwithstanding anything in the Registration Rights Agreement to
the contrary, there shall be no events preventing the sale of such Pledged
Securities pursuant to the Shelf Registration Statement, including, without
limitation, (i) any request by the Securities and Exchange Commission (the
"SEC") or any state securities authority for post-effective amendments and
supplements to the Shelf Registration Statement that has become effective, (ii)
the issuance by the SEC or any state securities authority of any stop order
suspending the effectiveness of the Shelf Registration Statement or the
initiation of any proceedings for that purpose, (iii) the representations and
warranties of the Company contained in any underwriting agreement, securities
sales agreement or other similar agreement, if any, relating to the sale of the
Pledged Securities cease to be true and correct in all material respects, (iv)
the receipt by the Company of any notification with respect to the suspension of
the qualification of the Pledged Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose and (v) the Secured
Parties are not in possession of any material non-public information and (4)
such Shelf Registration Statement shall remain effective until all the Pledged
Securities hereunder have been sold. For the avoidance of doubt, nothing in this
Section 6(b) shall be construed to limit the rights of the Lender to immediately
exchange any of the Pledged Securities consisting of NGOP Common Units into
shares of NGP Common Stock upon any foreclosure or sale (whether public or
private) of the Pledged Securities.
(c) Costs of Remedies. Recover from the Pledgor all reasonable costs and
expenses, including, without limitation, reasonable attorneys' fees (including
the allocated costs of inside counsel), incurred or paid by the Lender in
exercising any right, power or remedy provided by this Pledge Agreement or by
law.
(d) Vote of Pledged Securities. Vote or consent, and in connection
therewith the Pledgor grants to the Lender a proxy to vote or to consent, with
respect to the Pledged Securities. Notwithstanding the foregoing, the Lender
hereby agrees to vote, to the extent applicable, the Pledged Securities in favor
of the transactions contemplated by the Agreement and Plan of Merger dated as of
September 14, 2002 by and among NGOP, NGP, New NGOP LLC and NGP LLC (the "Merger
Agreement").
(e) Manner of Sale of Collateral.
(i) Unless the Pledged Securities are being sold pursuant to the Shelf
Registration Statement, restrict the prospective bidders or purchasers of
the Pledged Securities to persons or entities who (x) will represent and
agree that they are purchasing for their own account, for investment, and
not with a view to the distribution or sale of any of the Pledged
Securities; and (y) satisfy the offeree and purchaser requirements for a
valid private placement transaction under Section 4(2) of the Securities
Act of 1933, as amended (the "Act") or any other method of private
placement permitted under the Act, and the rules and regulations of the
Securities and Exchange Commission applicable thereto, or under any similar
statute, rule or regulation. The Pledgor agrees that disposition of the
Pledged Securities pursuant to any private sale made as provided above may
be at prices and on other terms less favorable than if the Pledged
Securities were sold at public sale, and that the Lender has no obligation
to delay the sale of any Pledged Securities for public sale under the Act.
The Pledgor agrees that a private sale or sales made under the foregoing
circumstances shall be deemed to have been made in a
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commercially reasonable manner and the Pledgor hereby waives, to the full
extent permitted by applicable law, any claims against the Lender arising
by reason of the fact that the price at which the Collateral may have been
sold at a private sale was less than the price that might have been
obtained at a public sale or was less than the aggregate amount of the
Obligations.
(ii) The Pledgor further agrees to do or to use his reasonable efforts
to cause to be done all such other acts and things as may be reasonably
necessary to make any sales of any portion or all of the Pledged Securities
pursuant to clause (i) of this Section 6(e), including sales under the Act,
valid and binding and in compliance with any and all applicable laws
(including, without limitation, the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Securities and Exchange
Commission applicable thereto), regulations, orders, writs, injunctions,
decrees or awards of any and all courts, arbitrators or governmental
instrumentalities, domestic or foreign, having jurisdiction over any such
sale or sales, all at the Pledgor's expense. The Pledgor further agrees
that a breach of any of the covenants contained in this Section 6 will
cause irreparable injury to the Lender and the Lender has no adequate
remedy at law in respect of such breach and, as a consequence, agrees that
each and every covenant contained in this Section 6 shall be specifically
enforceable against the Pledgor, and the Pledgor hereby waives and agrees
not to assert any defenses against any action for specific performance of
such covenants.
(f) Delivery to and Rights of Purchaser. Upon any sale or other disposition
pursuant to this Pledge Agreement, the Lender shall have the right to deliver,
assign and transfer to the purchaser thereof the Collateral or portion thereof
so sold or disposed of. The Lender may be the purchaser of any or all of the
Collateral so sold at a public sale and, to the extent permitted by law, at a
private sale. Each purchaser at any such sale or other disposition (including
the Lender) shall hold the Collateral free from any claim or right of whatever
kind, including any equity or right of redemption of the Pledgor, and the
Pledgor specifically waives (to the extent permitted by law) all rights of
redemption, stay or appraisal which he has or may have under any rule of law or
statute now existing or hereafter adopted. The Lender shall not be required to
marshal any Collateral with respect thereto in any particular order, and the
Pledgor hereby waives any and all rights thereof.
(g) Reliance on Experts. In exercising any remedies hereunder relating to
the sale of the Collateral, the Lender may utilize and rely on the services and
advice of one or more broker-dealers selected by the Lender and shall be fully
protected in so doing.
(h) No Exchange Until Sale. The Lender shall not effect any exchange of the
Pledged Securities consisting of NGOP Common Units into shares of NGP Common
Stock except in connection with the sale or foreclosure, or at any time after
foreclosure, of the Pledged Securities.
7. Collection of Collateral Payments.
(a) Each Pledgor shall, at such Pledgor's sole cost and expense, take all
reasonably necessary action to obtain payment, when due and payable, of all sums
due or to
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become due with respect to any Collateral ("Collateral Payments" or a
"Collateral Payment"), including, without limitation, the taking of such action
with respect thereto as the Lender may reasonably request, or, in the absence of
such request, as the Pledgor may reasonably deem advisable; provided, however,
upon the occurrence and continuance of an Event of Default, or if otherwise
prohibited by the Loan Documents, the Pledgor shall not, without the prior
written consent of the Lender, grant or agree to any rebate, refund, compromise
or extension with respect to any Collateral Payment or accept any prepayment on
account thereof. Upon the request of the Lender at the direction of the Lender
during the occurrence and continuance of an Event of Default, the Pledgor will
notify and direct any party who is or might become obligated to make any
Collateral Payment, to make payment thereof to the Collateral Agent at such
address as the Lender may designate. The Pledgor will reimburse the Lender
promptly upon demand for all reasonable out-of-pocket costs and expenses,
including reasonable attorneys' fees and litigation expenses, incurred by the
Lender in seeking to collect any Collateral Payment.
(b) Subject to the Credit Support Agreement, upon the occurrence and
continuance of an Event of Default and upon the request of the Lender, the
Pledgor will, forthwith upon receipt, transmit and deliver to the Lender, in the
form received, all cash, checks, drafts and other instruments for the payment of
money (properly endorsed where required so that such items may be collected by
the Lender) which may be received by the Pledgor at any time as payment on
account of any Collateral Payment and if such request shall be made, until
delivery to the Lender, such items will be held in trust for the Lender and will
not be commingled by the Pledgor with any of his other funds or property.
Thereafter, the Lender is hereby authorized and empowered to endorse the name of
the Pledgor on any check, draft or other instrument for the payment of money
received by the Lender on account of any Collateral Payment if the Lender
reasonably believes such endorsement is necessary or desirable for purposes of
collection.
(c) The Pledgor hereby indemnifies and saves harmless the Lender, and its
respective agents, officers and employees from and against all liabilities and
reasonable expenses on account of any adverse claim asserted against the Lender
(except for the Lender's own gross negligence or willful misconduct) relating to
any moneys received by the Lender on account of any Collateral Payment, and such
obligation of the Pledgor shall continue in effect after and notwithstanding the
discharge of the Obligations and the release of the security interest granted in
Section 1 above. This indemnity shall survive the termination of this Pledge
Agreement.
8. Cumulative Rights; Indemnity, etc. The rights, powers and remedies of
the Lender under this Pledge Agreement shall be in addition to all rights,
powers and remedies given to the Lender by virtue of any statute or rule of law,
the Credit Support Agreement or the other Loan Documents, all of which rights,
powers and remedies shall be cumulative and may be exercised successively or
concurrently without impairing the Lender's security interest in the Collateral.
The Pledgor shall indemnify and save the Lender harmless from and against any
and all liabilities, losses and damages which it may incur in the lawful and
proper exercise or performance of any of their rights or powers as authorized
herein (except for the Lender's own gross negligence or willful misconduct).
This indemnity shall survive the termination of this Pledge Agreement.
9. Waiver. Any waiver, forbearance or failure or delay by the Lender in
exercising any right, power or remedy shall not preclude the further exercise
thereof, and every right, power
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or remedy of the Lender shall continue in full force and effect until such
right, power or remedy is specifically waived in a writing. The Pledgor waives
any right to require Lender to proceed against any person or to exhaust any
Collateral or to pursue any remedy in the Lender's power.
10. No Responsibility for Loss; No Duty of Lender. The Lender is hereby
released from all responsibility for any depreciation in or loss of value of the
Pledged Securities (except for its own gross negligence or willful misconduct).
The rights and remedies of the Lender hereunder are solely to protect its
interest in the Collateral and shall not impose any further duty upon the
Lender.
11. Binding on Successors and Assigns. All rights and obligations of each
party hereto shall inure to the benefit of their respective successors and
assigns.
12. Amendment. This Pledge Agreement may not be amended or modified except
by a writing signed by the Pledgor and the Lender.
13. Notices. All notices, requests and demands which any party is required
or may desire to give to any other party under any provision of this Pledge
Agreement must be in writing and delivered to each party at the following
address:
PLEDGOR:
c/o American Golf Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇
With a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
LENDER:
Masters Funding LLC
c/o Goldman, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇)-▇▇▇-▇▇▇▇
Facsimile: (▇▇▇)-▇▇▇-▇▇▇▇
with a copy to:
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Fried, Frank, Harris, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: F. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
and:
SOF VI U.S. Holdings, LLC
c/o Starwood Capital Group Global, L.L.C.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇
and:
▇▇▇▇▇▇▇, Finkelstein & ▇▇▇▇▇▇▇▇, LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
or to such other address as any party may designate by written notice to all
other parties. Each such notice, request and demand shall be deemed given or
made as follows: (a) if sent by hand delivery, upon delivery; (b) if sent by air
courier or registered mail, upon receipt (whether accepted or refused) (as
evidenced by air courier's or postal service's proof of delivery); or (c) if
sent by telecopy, upon receipt.
14. Severability. The illegality or unenforceability of any provision of
this Pledge Agreement or any instrument or agreement required hereunder shall
not in any way affect or impair the legality or enforceability of the remaining
provisions of this Pledge Agreement or any instrument or agreement required
hereunder.
15. Governing Law and Jurisdiction.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT LENDER HAS
GREATER RIGHTS OR REMEDIES UNDER FEDERAL LAW, IN WHICH CASE SUCH CHOICE OF NEW
YORK LAW SHALL NOT BE DEEMED TO DEPRIVE LENDER OF SUCH RIGHTS AND REMEDIES AS
MAY BE AVAILABLE UNDER FEDERAL LAW.
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(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS PLEDGE AGREEMENT
MAY BE BROUGHT SOLELY IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED
STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF
THIS PLEDGE AGREEMENT, THE PARTIES HERETO, FOR THEMSELVES AND IN RESPECT OF
THEIR PROPERTY, SUBMIT TO THE EXCLUSIVE JURISDICTION OF THOSE COURTS. THE
PARTIES HERETO IRREVOCABLY WAIVE ANY OBJECTION, INCLUDING ANY OBJECTION TO THE
LAYING OF VENUE BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH THEY MAY NOW
OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS PLEDGE AGREEMENT OR ANY DOCUMENT RELATED HERETO.
THE PARTIES HERETO WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, AND ACKNOWLEDGE THAT SERVICE MAY BE MADE BY REGISTERED MAIL ADDRESSED
AS PROVIDED IN SECTION 13 OR BY ANY MEANS PERMITTED BY NEW YORK LAW.
(c) THE PARTIES HERETO WAIVE THEIR RIGHTS TO A TRIAL BY JURY OF ANY CLAIM
OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATING TO THIS PLEDGE
AGREEMENT. IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
ANY OF THE PARTIES HERETO AGAINST THE OTHER, WHETHER WITH RESPECT TO CONTRACT
CLAIMS, TORT CLAIMS, OR OTHERWISE, THE PLEDGOR AGREES THAT ANY SUCH CLAIM OR
CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING
THE FOREGOING, THE PARTIES HERETO FURTHER AGREE THAT THEIR RESPECTIVE RIGHTS TO
A TRIAL BY JURY ARE WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR ENFORCEABILITY OF THIS PLEDGE AGREEMENT. THIS WAIVER SHALL APPLY
TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
PLEDGE AGREEMENT.
16. Entire Agreement. Together with the other Loan Documents and the Credit
Support Agreement, this Pledge Agreement embodies the entire agreement of the
parties hereto with respect to the subject matter hereof and supersedes all
prior or contemporaneous agreement and understanding of such parties, verbal or
written.
17. Conflicting Provisions. In the event of a conflict between the terms of
this Pledge Agreement and the terms of the Credit Support Agreement in respect
of the rights and obligations of the Secured Parties, the terms of the Credit
Support Agreement shall govern.
18. Reinstatement. This Pledge Agreement and the security interest created
hereunder shall automatically be reinstated if and to the extent that for any
reason any payment by or on behalf of the Pledgor in respect of the Obligations
is rescinded or must otherwise be restored by any holder of the Obligations,
whether as a result of any proceedings in bankruptcy or reorganization or
otherwise, and the Pledgor shall indemnify the Lender on demand for all
reasonable costs and expenses (including, without limitation, fees of counsel)
incurred by the Lender in connection with such rescission or restoration.
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19. Suretyship Waivers. The provisions of Section 5.10 of the Credit
Support Agreement are hereby incorporated herein by this reference as if herein
set forth in full, MUTATIS MUTANDIS.
20. Fraudulent Conveyance. Each of Pledgor and Lender hereby confirms that
it is the intention of all such parties that the obligations of each Pledgor
under this Agreement, the Note or any other Loan Document not constitute a
fraudulent transfer or fraudulent conveyance for purposes of the Bankruptcy
Code, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act
or any similar federal or state law. To effectuate the foregoing intention, the
Borrowers and the Lender hereby irrevocably agree that the obligations of each
Borrower under this Agreement, the Note or any other Loan Document shall be
limited to the maximum amount which, after giving effect to all other contingent
and fixed liabilities of such Borrower (the "Subject Borrower") and after giving
effect to any collections from or payments made by or on behalf of the other
Borrower in respect of the obligations of such other Borrower under any Loan
Document, will result in the obligations of the Subject Borrower under this
Agreement, the Note or any other Loan Document not constituting a fraudulent
transfer or conveyance for purposes of the Bankruptcy Code, the Uniform
Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar
federal or state law.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Pledge Agreement
to be duly executed and delivered by their proper and duly authorized officers
as of the day and year first above written.
▇▇▇▇▇ ▇. ▇▇▇▇▇, as an individual and as
trustee of THE ▇▇▇▇▇ ▇. ▇▇▇▇▇ TRUST DATED
MARCH 5, 1998 (as amended), Pledgor
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------------
MASTERS FUNDING LLC
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Title: Authorized Person
--------------------------------