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EXHIBIT 10.7
DEBENTURE PLEDGE AGREEMENT
THIS AGREEMENT is made the day of April, 1998.
B E T W E E N:
▇▇▇▇▇▇ METAL PRODUCTS CO., an unlimited liability
company formed under the laws of the Province of
Nova Scotia
(the "Corporation")
OF THE FIRST PART;
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COMERICA BANK, as administrative agent for the
Banks under the Credit Agreement (as hereinafter
defined)
(the "Agent")
OF THE SECOND PART.
WHEREAS pursuant to a credit agreement dated as of the date hereof among
Talon Automotive Group, Inc., the Corporation, the Agent and the Banks (as
amended, supplemented, restated or replaced from time to time, the "Credit
Agreement"), Talon Automotive Group, Inc. and the Corporation (collectively,
the "Borrowers") are, or will become, indebted, liable and obligated to the
Banks (such indebtedness, liabilities and obligations being herein referred to
as the "Credit Agreement Obligations");
AND WHEREAS the Corporation has, under a guarantee of even date herewith
(as amended, supplemented, restated or replaced from time to time, the
"Guarantee"), guaranteed the due, prompt and complete payment, performance and
satisfaction of all the Credit Agreement Obligations (any indebtedness,
liabilities and obligations under the Guarantee being herein referred to as the
"Guarantee Obligations");
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AND WHEREAS the Corporation has agreed to execute and deliver a demand
debenture (the "Debenture") in the amount of U.S.$150,000,000, to and in favour
of the Agent, acting on its own behalf and as administrative agent for the
Banks, as security for the due, prompt and complete payment, performance and
satisfaction of all the Credit Agreement Obligations and Guarantee Obligations
(collectively, and together with any expenses, costs and charges incurred by or
on behalf of the Agent and/or the Banks in connection with the Debenture and
the enforcement of the security interest created thereby, the "Obligations");
AND WHEREAS the parties hereto are entering into this agreement for the
purpose of pledging the Debenture to the Agent, as administrative agent for the
Banks;
NOW THEREFORE THIS AGREEMENT WITNESSETH that, in consideration of the
sum of Two Dollars ($2.00) now paid by the Agent to the Corporation and for
other good and valuable consideration (the receipt and sufficiency of which are
hereby acknowledged), the Corporation agrees with the Agent as follows:
ARTICLE 1
INTERPRETATION
1.1 DEFINITIONS
All capitalized terms used herein shall, unless otherwise indicated,
have the meaning set forth in the Credit Agreement. In this Agreement, "BANKS"
means those financial institutions whose names appear as "Banks" on the
signature pages to the Credit Agreement, together with any assignees thereof
pursuant to Section 13.5 of the Credit Agreement, and shall include the
Canadian Swingline Lender under the Credit Agreement; and "BANK" shall mean any
one of the foregoing Banks.
1.2 INTERPRETATION
This Agreement shall be interpreted in accordance with the following:
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(a) words denoting the singular include the plural and vice versa
and words denoting any gender include all genders;
(b) headings shall not affect the interpretation of this
Agreement;
(c) references to dollars, unless otherwise specifically
indicated, shall be references to lawful money of the United States
of America;
(d) the word "including" shall mean "including without
limitation" and "includes" shall mean "includes without limitation";
(e) the expressions "the aggregate", "the total", "the sum" and
expressions of similar meaning shall mean "the aggregate (or total
or sum) without duplication"; and
(f) in the computation of periods of time, unless otherwise
expressly provided, the word "from" means "from and including" and
the words "to" and "until" mean "to but excluding".
1.3 SURVIVAL
All covenants, agreements, warranties and representations set forth
herein or in any certificate or other instrument or document delivered by or on
behalf of the Corporation pursuant hereto shall be deemed to have been relied
upon by the Agent notwithstanding investigations heretofore or hereafter made
by the Agent and shall survive the execution of this Agreement and continue in
full force and effect in accordance with the terms of this Agreement until the
due, prompt and complete payment, performance and satisfaction of all of the
Obligations.
1.4 AMENDMENT
No amendment of any provision of this Agreement shall be effective
unless the same shall be in writing and signed by each of the Corporation and
the Agent.
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1.5 SEVERABILITY
If any provision of this Agreement is or becomes illegal, invalid or
unenforceable, such provision shall be severed from this Agreement and be
ineffective to the extent of such illegality, invalidity or unenforceability.
The remaining provisions hereof shall be unaffected by such provision and shall
continue to be valid and enforceable.
1.6 STATUTES, ETC.
Unless otherwise specified herein, all references to statutes or
regulations are to be treated as references to the same as amended,
consolidated, revised or re-enacted from time to time, or to any successor or
replacement statutes or regulations.
ARTICLE 2
DEALINGS WITH DEBENTURE
2.1 DEPOSIT OF DEBENTURE
The Corporation hereby delivers the Debenture to the Agent to be held
by it, as administrative agent for the Banks, pursuant to the provisions hereof
as continuing security for the due, prompt and complete payment, performance
and satisfaction of all the Obligations.
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2.2 EVENTS OF DEFAULT
Following the occurrence and during the continuance of an Event of
Default, the Agent may at any time demand payment of the Debenture and enforce
all rights and remedies which are accorded to the Agent as holder of the
Debenture, including making demands thereunder as if the Agent were the
absolute owner of the Debenture, realizing upon the Debenture or disposing of
the Debenture by sale, transfer or delivery, and any such remedy may be
exercised separately or in combination and shall be in addition to and not in
substitution for any other rights of the Agent however created under the
Documents; provided that the Agent shall not be bound to exercise any such
right or remedy.
2.3 APPLICATION OF PROCEEDS
All proceeds of the Debenture, including any distributions in respect
thereof, shall be applied by the Agent on account of the Obligations in
accordance with the provisions of the Debenture, without prejudice to any claim
on the Corporation for any deficiency.
2.4 SATISFACTION OF OBLIGATIONS
Payment in full of the Obligations from time to time shall be deemed to
be payment in full of all principal and interest from time to time due under
the Debenture. Notwithstanding anything to the contrary in the Debenture, the
Corporation shall not be obligated to pay any amounts in excess of the
Obligations, nor shall the Corporation be obligated to pay any greater amount
of interest under the Debenture than the highest rate of interest payable by
the Corporation under the Documents (other than the Debenture) in respect of
the Obligations. Upon final satisfaction in full of the Obligations, the Agent
shall, at the request and expense of the Corporation, deliver the Debenture to
the Corporation for cancellation or assign the Debenture (without recourse to
the Agent) to such other Person as the Corporation may direct.
2.5 NO ▇▇▇▇▇▇
▇
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▇▇▇ ▇▇▇▇▇▇▇▇▇ shall not operate to merge any of the Obligations and no
judgment recovered by the Agent shall operate to merge or in any way affect the
security constituted by the Debenture, which is held in addition to and not in
substitution for any other security now or hereafter held or acquired by the
Agent.
ARTICLE 3
MISCELLANEOUS
3.1 REMEDIES CUMULATIVE AND WAIVER
It is expressly understood and agreed that the respective rights and
remedies of the Agent hereunder are cumulative and are in addition to and not
in substitution for any other rights and remedies provided by law or by equity.
Any single or partial exercise by the Agent of any right or remedy in respect
of a default or breach of any term, covenant or condition contained herein or
in the Debenture shall not be deemed to be a waiver or to alter, affect or
prejudice any other right or remedy hereunder or thereunder or other rights or
remedies to which the Agent may be lawfully entitled, for such default or
breach. Any waiver by the Agent of the strict observance, performance or
compliance with any term, covenant, condition or agreement contained herein or
in the Debenture and any indulgence granted, either expressly or by course of
conduct, by the Agent shall be effective only in the specific instance and for
the purpose for which it was given and shall be deemed not to be a waiver of
any of the rights and remedies of the Agent hereunder or under the Debenture as
a result of any other default or breach.
3.2 OTHER AGREEMENTS
The Debenture and this Debenture Pledge Agreement are given in
accordance with the terms and provisions of the Credit Agreement. If a
conflict or inconsistency exists between a provision of the Debenture or this
Debenture Pledge Agreement and a provision of the Credit Agreement, then the
provisions of the Credit Agreement shall prevail. Notwithstanding the
foregoing, if there is any right or remedy set out in the Debenture or this
Debenture Pledge Agreement or any part thereof which is not set out or provided
for in the Credit Agreement, such additional right or remedy shall not
constitute a conflict
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or inconsistency.
3.3 ASSIGNMENTS AND PARTICIPATIONS
The Agent or any of the Banks may sell, assign, transfer or otherwise
dispose of all or any of the Obligations in accordance with the terms of the
Credit Agreement and, in such event, each and every immediate and successive
assignee, transferee or holder of all or any of the Obligations shall have, in
respect of the Obligations sold, assigned, transferred or otherwise disposed of
to it, the whole benefit hereof to the same extent as if it were an original
party to the Obligations or the part thereof so sold, assigned, transferred or
otherwise disposed of, without regard to any set-off, counter-claim or equities
between the Corporation and the Agent.
3.4 NOTICE
Any demand, notice or communication to be made or given hereunder shall
be in writing and shall be personally delivered to an officer or other
responsible employee of the addressee or sent by facsimile, charges prepaid, at
or to the applicable addresses or facsimile numbers, as the case may be, set
out below the respective parties' names as follows:
To the Corporation: ▇▇▇▇▇▇ Metal Products Co.
c/o Talon Automotive Group
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
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Timmis & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
To the Holder: Comerica Bank
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇.▇.▇. ▇▇▇▇▇
Attention: President
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Miller, Canfield, Paddock and Stone, P.L.C.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇.▇.▇. ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Barristers & Solicitors
Suite 2400
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
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or to such other address or addresses or facsimile number or numbers as any
party hereto may from time to time designate to the other parties in such
manner. Any communication which is personally delivered as aforesaid, shall be
deemed to have been validly and effectively given on the date of such delivery
if such date is a Business Day and such delivery was made during normal
business hours of the recipient; otherwise, it shall be deemed to have been
validly and effectively given on the Business Day next following such date of
delivery. Any communication which is transmitted by facsimile as aforesaid
shall be deemed to have been validly and effectively given on the date of
transmission if such date is a Business Day and such transmission was made
during normal business hours of the recipient; otherwise, it shall be deemed to
have been validly and effectively given on the Business Day next following such
date of transmission.
3.5 GOVERNING LAW
(a) This Agreement shall be governed by and interpreted in
accordance with the laws of the Province of Ontario and the laws of
Canada applicable therein which apply to contracts made and to be
performed entirely in Ontario;
(b) The parties hereby irrevocably attorn and submit to the
non-exclusive jurisdiction of the courts of Ontario with respect to
any matter arising under or related to this Agreement.
3.6 BENEFIT OF THE AGREEMENT
This Agreement shall enure to the benefit of the Agent and its
successors and assigns and be binding upon the Corporation and its successors
and permitted assigns.
3.7 COPY RECEIVED
The Corporation acknowledges receipt of a copy of this Agreement.
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IN WITNESS WHEREOF the Corporation has caused this Agreement to be
executed the day, month and year first written above.
▇▇▇▇▇▇ METAL PRODUCTS CO.
Per:
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(Authorized Signing Officer)
COMERICA BANK
Per:
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(Authorized Signing Officer)
Per:
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(Authorized Signing Officer)