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PLEDGE AGREEMENT
This PLEDGE AGREEMENT (the "Agreement"), dated as of February 16,
1994, is executed by and among EQUITY HOLDINGS LIMITED, an Illinois limited
partnership ("Limited"), RIVERSIDE PARTNERS, an Illinois limited partnership
("Riverside")(Limited and Riverside each individually a "Pledgor" and
collectively the "Pledgors"), and CITIBANK, N.A. (the "Bank").
PRELIMINARY STATEMENTS:
(1) The Bank has entered into a Credit Agreement dated as of February
16, 1994 (said Agreement, as it may hereafter be amended, restated supplemented
or otherwise modified from time to time, being the "Credit Agreement", the
terms defined therein and not otherwise defined herein being used herein as
therein defined) with the Pledgors. The Pledgors will derive substantial direct
and indirect benefit from the transactions contemplated by the Credit
Agreement.
(2) The Pledgors are the owners of the shares (such shares, together
with all additional shares of stock at any time hereafter pledged to the Bank
in accordance with the terms of this Agreement being the "Pledged Shares") of
stock described in Schedule I hereto and issued by the corporations named
therein.
(3) It is a condition precedent to the making of Advances by the Bank
under the Credit Agreement that the Pledgors, shall have made the pledge
contemplated by this Agreement.
NOW, THEREFORE, in consideration of the premises and in order to
induce the Bank to make Advances under the Credit Agreement, the Pledgors and
the Bank hereby agree as follows:
SECTION 1. Pledge. Each Pledgor hereby pledges to the Bank, and grants
to the Bank a security interest in, the following (the "Pledged Collateral"):
(i) the Pledged Shares, and the certificates representing the Pledged
Shares, and, subject to the provisions of Section 6 hereof, all dividends,
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 Shares; and
(ii) any and all options, warrants, shares of indebtedness or other
instruments, documents or rights with respect to the Pledged Shares
hereafter pledged to the Bank in accordance with the terms of this
Agreement, and, subject to the provisions of Section 6 hereof, all
dividends,
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principal, 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 foregoing.
SECTION 2. Security for Obligations. This Agreement secures the
payment of all obligations of the Pledgors now or hereafter existing under the
Credit Agreement and the Note, whether for principal, interest, fees, expenses
or otherwise, and all obligations of the Pledgors now or hereafter existing
under this Agreement (all such obligations of the Pledgors under the Credit
Agreement, the Note and this Agreement being the "Obligations"). Without
limiting the generality of the foregoing, this Agreement secures the payment of
all amounts which constitute part of the Obligations and would be owed by the
Borrowers to the Bank under the Credit Agreement and the Note but for the fact
that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving the Borrower.
SECTION 3. Delivery of Pledged Collateral. All certificates or
instruments representing or evidencing the Pledged Collateral shall be
delivered to and held by or on behalf of the Bank pursuant hereto and shall be
in suitable form for transfer by delivery, or shall be accompanied by duly
executed instruments of transfer or assignment in blank, all in form and
substance satisfactory to the Bank. The Bank shall have the right, at any time
after an Event of Default, and subject to Section 6 hereof, and without notice
to the Pledgors, to transfer to or to register in the name of the Bank or any
of its nominees any or all of the Pledged Collateral. In addition, the Bank
shall have the right at any time to exchange certificates or instruments
representing or evidencing Pledged Collateral for certificates or instruments
of smaller or larger denominations.
SECTION 4. Representations and Warranties. Each Pledgor hereby
represents and warrants as follows:
(a) The Pledged Shares pledged by it hereunder have been duly
authorized and validly issued and are fully paid and non-assessable.
(b) Such Pledgor is the legal and beneficial owner of the Pledged
Collateral pledged by it hereunder, free and clear of any lien, security
interest, option or other charge or encumbrance except for the security
interest created by this Agreement and such Pledgor has full power to enter
into this Agreement.
(c) This Agreement creates a valid first priority security interest in
the Pledged Collateral, securing the payment
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of the Obligations and, upon delivery of the Pledged Shares to the Bank, such
security interest shall be perfected.
(d) Such Pledgor has the right to vote, pledge and grant a security
interest in or otherwise transfer the Pledged Collateral pledged by it
hereunder, free of any security interest, lien, claim or encumbrance.
(e) No consent of any other person or entity and no authorization,
approval, or other action by, and no notice to or filing with, any governmental
authority or regulatory body is required (i) for the pledge by such Pledgor of
the Pledged Collateral pledged by it pursuant to this Agreement or for the
execution, delivery or performance of this Agreement by such Pledgor, (ii) for
the perfection or maintenance of the security interest created hereby
(including the first priority nature of such security interest) or (iii) for
the exercise by the Bank of the voting or other rights provided for in this
Agreement or the remedies in respect of such Pledged Collateral pursuant to
this Agreement (except as may be required in connection with any disposition of
any portion of such Pledged Collateral by laws affecting the offering and sale
of securities generally).
(f) The Pledged Shares pledged by it on the date hereof constitute the
percentage of the issued and outstanding shares of stock of the respective
issuers thereof indicated on Schedule I, and in the case of any pledge of
Additional Collateral under Section 7 below, such Additional Collateral on the
date of such pledge constitutes the respective percentage of the issued and
outstanding shares of stock of the respective issuers thereof indicated in the
Pledge Certificate executed by the applicable Pledgor in connection therewith.
(g) There are no conditions precedent to the effectiveness of this
Agreement that have not been satisfied or waived.
(h) Such Pledgor has, independently and without reliance upon the
Bank, the other Pledgor or any other Person, and based on such documents and
information as it has deemed appropriate, made its own analysis and decision to
enter into this Agreement.
(i) The Pledged Shares pledged by it hereunder have been beneficially
owned by such Pledgor for a period of not less than three (3) years as of the
date of this Agreement.
SECTION 5. Further Assurances. Each Pledgor agrees that at any time
and from time to time, at the expense of such Pledgor, such Pledgor will
promptly execute and deliver all further instruments and documents, and take
all further action, that may be necessary or desirable, or that the Bank may
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reasonably request, in order to perfect and protect any security interest
granted or purported to be granted hereby or to enable the Bank to exercise and
enforce its rights and remedies hereunder with respect to any Pledged
Collateral.
SECTION 6. Voting Rights; Dividends; Etc. (a) So long as no Event of
Default shall have occurred and be continuing:
(i) Each Pledgor shall be entitled to exercise or refrain from
exercising any and all voting and other consensual rights pertaining to
the Pledged Collateral or any part thereof for any purpose not inconsistent
with the terms of this Agreement or the Credit Agreement; provided,
however, that no Pledgor shall exercise or refrain from exercising any such
right if such action would be reasonably likely to cause a reduction in the
value of the Pledged Collateral with the result that the aggregate
principal amount of the Advances then outstanding would exceed the Facility
Availability Amount in effect at such time.
(ii) Each Pledgor shall be entitled to receive and retain any and all
dividends and interest paid in respect of the Pledged Collateral, provided,
however, that any and all
(A) dividends and interest paid or payable other than in
cash in respect of, and instruments and other property received,
receivable or otherwise distributed in respect of, or in exchange for,
any Pledged Collateral,
(B) dividends and other distributions paid or payable in
cash in respect of any Pledged Collateral in connection with a partial
or total liquidation or dissolution or in connection with a reduction
of capital, capital surplus or paid-in-surplus, and
(C) cash paid, payable or otherwise distributed in respect
of principal of, or in redemption of, or in exchange for, any Pledged
Collateral,
shall be, and shall be forthwith delivered to the Bank to hold as, Pledged
Collateral and shall, if received by any Pledgor, be received in trust for
the benefit of the Bank, be segregated from the other property or funds of
such Pledgor, and be forthwith delivered to the Bank as Pledged Collateral
in the same form as so received (with any necessary indorsement or
assignment).
(iii) The Bank shall execute and deliver (or cause to be executed and
delivered) to each Pledgor all such proxies and other instruments as such
Pledgor may reasonably request for the purpose of enabling such Pledgor to
exercise the voting
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and other rights which it is entitled to exercise pursuant to paragraph
(i) above and to receive the dividends or interest payments which it is
authorized to receive and retain pursuant to paragraph (ii) above.
(b) Upon the occurrence and during the continuance of an Event of
Default:
(i) All rights of any Pledgor (x) to exercise or refrain from
exercising the voting and other consensual rights which it would otherwise
be entitled to exercise pursuant to Section 6(a)(i) shall, upon notice to
such Pledgor by the Bank, cease and (y) to receive the dividends and
interest payments which it would otherwise be authorized to receive and
retain pursuant to Section 6(a)(ii) shall, upon notice to such Pledgor by
the Bank, cease, and all such rights shall thereupon become vested in the
Bank, and the Bank shall thereupon have the sole right to exercise or
refrain from exercising such voting and other consensual rights and to
receive and hold as Pledged Collateral such dividends and interest
payments.
(ii) All dividends and interest payments which are received by any
Pledgor contrary to the provisions of paragraph (i) of this Section 6(b)
shall be received in trust for the benefit of the Bank, shall be segregated
from other funds of such Pledgor and shall be forthwith paid over to the
Bank as Pledged Collateral in the same form as so received (with any
necessary indorsement).
SECTION 7. Tansfers and Other Liens; Additional Shares. (a) Each
Pledgor agrees that it will not (i) sell, assign (by operation of law or
otherwise) or otherwise dispose of, or grant any option with respect to, any of
the Pledged Collateral, or (ii) create or permit to exist any lien, security
interest, option or other charge or encumbrance upon or with respect to any of
the Pledged Collateral, except for the security interest under this Agreement.
(b) Each Pledgor agrees that it will pledge hereunder, immediately
upon its acquisition (directly or indirectly) thereof, any and all additional
shares of stock or other securities of each issuer of the Pledged Shares which
are issued in substitution for any or a11 of the Pledged Shares or other
Pledged Collateral and, until such pledge, such shares shall be held in trust
by such Pledgor, subject to the interests of the Bank hereunder.
(c) Each Pledgor may, from time to time, elect to substitute shares
of stock for shares of stock previously pledged to the Bank, pledge additional
shares of stock, cash equivalent investments, debt instruments and other
similar property
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("Additional Collateral") to the Bank as security for the Obligations, by
delivering such Additional Collateral accompanied by a certificate made by such
Pledgor (a "Pledge Certificate"), substantially in the form of Exhibit A
hereto, to the Bank. Upon written acknowledgment by the Bank of the delivery to
the Bank of proposed Additional Collateral, and the acceptance by the Bank of
such Additional Collateral as Pledged Collateral (which acceptance may, in the
sole discretion of the Bank, be subject to the satisfaction of each of the
covenants of the applicable Pledgor set forth in Section 3 and 5 hereof in
respect of such Additional Collateral and the sufficiency and validity of the
accompanying Pledge Certificate), such Additional Collateral shall become and
be Pledged Collateral for all purposes of this Agreement.
SECTION 8. Bank Appointed Attorney-in-Fact. Each Pledgor hereby
appoints the Bank as its attorney-in-fact, with full authority in the place and
stead of such Pledgor and in the name of such Pledgor or otherwise, from time
to time in the Bank's sole discretion upon the occurrence and continuance of an
Event of Default to take any action and to execute any instrument which the
Bank may deem necessary or advisable to accomplish the purposes of this
Agreement (subject to the rights of such Pledgor under Section 6), including,
without limitation, to receive, indorse and collect all instruments made
payable to such Pledgor representing any dividend, interest payment or other
distribution in respect of the Pledged Collateral or any part thereof and to
give full discharge for the same.
SECTION 9. Bank May Perform. If either Pledgor fails to perform any
agreement contained herein, after receipt of notice of such nonperformance and
a reasonable time to cure, the Bank may itself perform, or cause performance
of, such agreement, and the reasonable expenses of the Bank incurred in
connection therewith shall be payable by the Pledgors under Section 13.
SECTION 10. The Bank's Duties. The powers conferred on the Bank
hereunder are solely to protect its interest in the Pledged Collateral and
shall not impose any duty upon it to exercise any such powers. The Bank shall
not be liable for any acts, omissions, errors of judgment or mistakes of fact
or law including, without limitation, acts, omissions, errors or mistakes with
respect to the Pledged Collateral, except for those arising out of or in
connection with the Bank's (i) gross negligence or willful misconduct, or (ii)
failure to use reasonable care with respect to the safe custody of the Pledged
Collateral in the Bank's possession. Except for the safe custody of any Pledged
Collateral in its possession and the accounting for moneys actually received by
it hereunder, the Bank shall have no duty as to any Pledged Collateral, as to
ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any Pledged
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Collateral, whether or not the Bank has or is deemed to have knowledge of such
matters, or as to the taking of any necessary steps to preserve rights against
any parties or any other rights pertaining to any Pledged Collateral. All
expenses incurred in connection therewith shall be for the sole account of the
Pledgors, and shall constitute part of the Obligations secured hereby.
SECTION 11. Remedies. (a) The bank shall have, in addition to any
other rights given under this Agreement or by law, all of the rights and
remedies with respect to the Pledged Collateral of a secured party under the
Uniform Commercial Code as in effect in the State of New York. In addition,
after the occurrence of an Event of Default, the Bank shall have such powers of
sale and other powers as may be conferred by applicable law. With respect to
the Pledged Collateral or any part thereof which shall then be in or shall
thereafter come into the possession or custody of the Bank or which the Bank
shall otherwise have the ability to transfer under applicable law, the Bank
may, in its sole discretion, without notice except as specified below, after
the occurrence of an Event of Default, sell or cause the same to be sold at any
exchange, broker's board or at public or private sale, in one or more sales or
lots, at such price as the Bank may deem best, for cash or on credit or for
future delivery, without assumption of any credit risk, and the purchaser of
any or all of the Pledged Collateral so sold shall thereafter own the same,
absolutely free from any claim, encumbrance or right of any kind whatsoever.
The Bank may, in its own name, or in the name of a designee or nominee, buy the
Pledged Collateral at any public sale and, if permitted by applicable law, buy
any or all of the Pledged Collateral at any private sale. The Pledgors will pay
to the Bank all reasonable expenses (including, without limitation, court costs
and reasonable attorneys' and paralegals' fees and expenses) of, or incidental
to, the enforcement of any of the provisions hereof. The Bank agrees to
distribute any proceeds of the sale of the Pledged Collateral in accordance
with the Credit Agreement and the Pledgors jointly and severally shall remain
liable for any deficiency following the sale of the Pledged Collateral.
(b) After an Event of Default, unless any of the Pledged Collateral
threatens to decline speedily in value, the Bank will give the Pledgors
reasonable notice of the time and place of any public sale thereof, or of the
time after which a private sale or other intended disposition is to be made.
Any sale of the Pledged Collateral conducted in conformity with reasonable
commercial practices of banks, commercial finance companies, insurance
companies or other financial institutions disposing of property similar to the
Pledged Collateral shall be deemed to be commercially reasonable.
Notwithstanding any provision to the contrary contained herein, each Pledgor
agrees that any requirements of reasonable notice shall be met if such
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notice is received by the Pledgors as provided in Section 13 below at least
five (5) Business Days before the time of the sale or disposition; provided,
however, that the Bank may give any shorter notice that is commercially
reasonable under the circumstances. Any other requirement of notice, demand or
advertisement for sale is waived, to the extent permitted by law.
(c) In view of the fact that federal and state securities laws may
impose certain restrictions on the method by which a sale of the Pledged
Collateral may be effected after an Event of Default, each Pledgor agrees that
after the occurrence of an Event of Default, the Bank may, from time to time,
attempt to sell all or any part of the Pledged Collateral by means of a private
placement restricting the bidders and prospective purchasers to those who are
qualified and will represent and agree that they are purchasing for investment
only and not for distribution. In so doing, the Bank may solicit offers to buy
the Pledged Collateral, or any part of it, from a limited number of investors
deemed by the Bank, in its reasonable judgment, to be financially responsible
parties who might be interested in purchasing the Pledged Collateral. If the
Bank solicits such offers from not less than four (4) such investors, then the
acceptance by the Bank of the highest offer obtained therefrom shall be deemed
to be a commercially reasonable method of disposing of such Pledged Collateral;
provided, however, that this Section does not impose a requirement that the
Bank solicit offers from four or more investors in order for the sale to be
commercially reasonable.
(d) No delay on the part of the Bank in the exercise of any right or
remedy arising under this Agreement, the Credit Agreement, any of the other
Loan Documents or otherwise with respect to all or any part of the Obligations,
the Collateral or any Guaranty of or security for all or any part of the
Obligations shall operate as a waiver thereof, and no single or partial
exercise by the Bank of any such right or remedy shall preclude any further
exercise thereof. Failure by the Bank at any time or times hereafter to
require strict performance by a Pledgor, a Guarantor of all or any part of the
Obligations or any other party of any of the provisions, warranties, terms and
conditions contained in any of the Loan Documents now or at any time or times
hereafter executed by such parties and delivered to the Bank shall not waive,
affect or diminish any right of the Bank at any time or times hereafter to
demand strict performance thereof and such right shall not be deemed to have
been waived by any act or knowledge of the Bank, or its agents, officers or
employees, unless such waiver is contained in an instrument in writing,
directed and delivered to the Pledgors, specifying such waiver, and is signed
by the Bank. No waiver of any Event of Default by the bank shall operate as a
waiver of any other Event of Default or the same Event of Default on a future
occasion, and no action by the Bank permitted hereunder shall in any way affect
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or impair the Bank's rights and remedies or the obligations of the Pledgors
under this Agreement.
SECTION 12. Registration Rights. The parties hereto have entered into
this Agreement in reliance on the existence of certain rights being available
to the Bank under Rule 144(k) of the Securities and Exchange Commission (as
interpreted in no-action letters thereunder) to dispose of the Pledged
Collateral without registering the Pledged Collateral. If the Bank determines
that the adoption of or any change in the judicial or administrative
interpretation of any law or regulation or any guideline or request from any
governmental authority (whether or not having the force of law) has the effect
of rendering the rights now provided by Rule 144(k) or any other successor rule
or regulation unavailable to the Bank so that the Bank cannot publicly sell all
or any of the Pledged Collateral pursuant to Section 11 without registration of
such Pledged Collateral under the Securities Act (as hereinafter defined), each
Pledgor agrees that, upon request of the Bank, such Pledgor will, at its own
expense:
(a) execute and deliver, and use its best efforts to cause each issuer
of the Pledged Collateral contemplated to be sold and the directors and
officers thereof to execute and deliver, all such instruments and
documents, and do or cause to be done all such other acts and things, as
may be necessary or, in the opinion of the Bank, advisable to register such
Pledged Collateral under the provisions of the Securities Act of 1933, as
from time to time amended (the "Securities Act"), and to cause the
registration statement relating thereto to become effective and to remain
effective for such period as prospectuses are required by law to be
furnished, and to make all amendments and supplements thereto and to the
related prospectus which, in the opinion of the Bank, are necessary or
advisable, all in conformity with the requirements of the Securities Act
and the rules and regulations of the Securities and Exchange Commission
applicable thereto;
(b) use its best efforts to qualify the Pledged Collateral under the
state securities or "Blue Sky" laws and to obtain all necessary
governmental approvals for the sale of the Pledged Collateral, as requested
by the Bank;
(c) use its best efforts to cause each such issuer to make available
to its security holders, as soon as practicable, an earning statement which
will satisfy the provisions of Section ll(a) of the Securities Act; and
(d) use its best efforts to do or cause to be done all such other acts
and things as may be necessary to make such sale of the Pledged Collateral
or any part thereof valid and
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binding and in compliance with applicable law.
The Pledgors will reimburse the Bank for all expenses incurred by the Bank,
including, without limitation, reasonable attorneys' and accountants' fees and
expenses in connection with the foregoing. Upon or at any time after the
occurrence of an Event of Default, if the Bank reasonably determines that,
prior to any public offering of any securities constituting part of the Pledged
Collateral, the adoption of or any change in the judicial or administrative
interpretation of any law or regulation or any guideline or request from any
governmental authority (whether or not having the force of law) renders Rule
144(k) or any other successor rule or regulation unavailable to the Bank so
that the Bank cannot publicly sell all or any of the Pledged Collateral
pursuant to Section 11 without registration of such Pledged Collateral under
the Securities Act and as such the securities should be registered under the
Securities Act and/or registered or qualified under any other federal or state
law and such registration and/or qualification is not practicable, then each
Pledgor agrees that it will be commercially reasonable if a private sale, upon
at least five (5) Business Days' notice to the Pledgors, is arranged so as to
avoid a public offering, even though the sales price established and/or
obtained at such private sale may be substantially less then prices which could
have been obtained for such security on any market or exchange or in any other
public sale. Each Pledgors further acknowledges the impossibility of
ascertaining the amount of damages which would be suffered by the Bank by
reason of the failure by either Pledgor to perform any of the covenants
contained in this Section and, consequently, agrees that, if either Pledgor
shall fail to perform any of such covenants, the Pledgors shall pay, as
liquidated damages and not as a penalty, an amount equal to the value of the
Pledged Collateral on the date the Bank shall demand compliance with this
Section.
SECTION 13. Expenses. The Pledgors jointly and severally agree to pay
the Bank upon demand by the Bank the amount of any and all reasonable expenses,
including the reasonable fees and expenses of its counsel and of any experts
and agents, which the Bank may incur in connection with (i) the custody or
preservation of, or the sale of, collection from, or other realization upon,
any of the Pledged Collateral, (ii) the exercise or enforcement of any of the
rights of the Bank hereunder or (iii) the failure by any Pledgor to perform or
observe any of the provisions hereof.
SECTION 14. Amendments. Etc. No amendment or waiver of any provision
of this Agreement, and no consent to any departure by any Pledgor here from,
shall in any event be effective unless the same shall be in writing and signed
by the bank, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which
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given.
SECTION 15. Notices. All notices and other communications required or
desired to be served, given or delivered hereunder shall be given in the manner
and to the addresses set forth in the Credit Agreement.
SECTION 16. Continuing Security Interest: Assignments under Credit
Agreement. This Agreement shall create a continuing security interest in the
Pledged Collateral and shall (i) remain in full force and effect until the
later of (x) the payment in full of the Obligations and all other amounts
payable under this Agreement, (y) the expiration or termination of the
Commitment, and (z) as to any Pledged Collateral released pursuant to the terms
of the Credit Agreement, the release of such Pledged Collateral, (ii) be
binding upon each Pledgor, its successors and assigns, which shall include,
without limitation, a receiver, trustee or debtor-in-possession of or for such
Pledgor, and (iii) inure to the benefit of, and be enforceable by, the Bank and
its successors, transferees and assigns. Without limiting the generality of the
foregoing clause (iii), the Bank may, subject to the limitations imposed on
such assignment or transfer by the Credit Agreement, assign or otherwise
transfer all or any portion of its rights and obligations under the Credit
Agreement (including, without limitation, all or any portion of its Commitment,
the Advances and the Note) to any other person or entity, and such other person
or entity shall thereupon become vested with all the benefits in respect
thereof granted to the Bank herein or otherwise. Upon the later of the payment
in full of the Obligations and all other amounts payable under this Agreement
and the expiration or termination of the Commitment, the security interest
granted hereby shall terminate and all rights to the Pledged Collateral shall
revert to the Pledgors. Upon any such termination, the Bank will, at the
Pledgors' expense, return to the Pledgors such of the Pledged Collateral as
shall not have been sold or otherwise applied pursuant to the terms hereof and
execute and deliver to the Pledgors such documents as the Pledgors shall
reasonably request to evidence such termination.
SECTION 17. Waivers. The Pledgors waive presentment and demand for
payment of any of the Obligations, protest and notice of dishonor or Event of
Default with respect to any of the Obligations and all other notices to which
the Pledgor might otherwise be entitled except as otherwise expressly provided
herein or in the Credit Agreement.
SECTION 18. GOVERNING LAW. ANY DISPUTE BETWEEN THE BANK AND THE
PLEDGORS ARISING OUT OF OR RELATED TO THE RELATIONSHIP BETWEEN THEM IN
CONNECTION WITH THIS AGREEMENT, AND WHETHER ARISING IN CONTRACT, TORT, EQUITY,
OR OTHERWISE SHALL BE RESOLVED IN ACCORDANCE WITH THE LAWS OF THE
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STATE OF NEW YORK.
SECTION 19. Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but, if any provision of this Agreement shall be held to
be prohibited or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.
SECTION 20. Joint and Several Liability. (a) The obligations of each
Pledgor in respect of the payment of any amount due hereunder shall be joint
and several.
(b) The obligations of each Pledgor hereunder resulting from its joint
and several liability shall be unconditional and absolute and, without limiting
the generality of the foregoing, shall not be released, discharged or otherwise
affected by:
(i) any extension, renewal, settlement, compromise, waiver or release
in respect of any obligation of the other Pledgor under this Agreement, the
Credit Agreement or the Note or the exchange, release or non-perfection
of any Pledged Collateral or other collateral security therefor;
(ii) any modification or amendment of or supplement to this Agreement,
the Credit Agreement or the Note;
(iii) any change in the partnership or corporate existence, structure
or ownership of the other Pledgor or any insolvency, bankruptcy,
reorganization or other similar proceeding affecting the other Pledgor or
its assets;
(iv) the existence of any claim, set-off or other rights which such
Pledgor may have at any time against the other Pledgor or the Bank or any
other Person, whether in connection herewith or any unrelated transactions,
Provided that nothing herein shall prevent the assertion of any such claim
by separate suit or compulsory counterclaim;
(v) any invalidity or unenforceability relating to or against the
other Pledgor for any reason of any provision or all of this Agreement, the
Credit Agreement or the Note, or any provision of applicable law or
regulation purporting to prohibit the payment by such other Pledgor of the
principal of or interest on the Note made by it or any other amount payable
by it under this Agreement or the Credit Agreement; or
(vi) any other act or omission to act or delay of any
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kind by the other Pledgor or the Bank or any other Person or any other
Circumstance whatsoever which might, but for the provisions of this
paragraph, constitute a legal or equitable discharge of such Pledgor's
obligations hereunder.
(c) Each Pledgor's obligations under this Section 20 shall remain in
full force and effect until the principal of and interest on the Note and all
other amounts payable by any Pledgor under the Credit Agreement and this
Agreement shall have been paid in full and the Commitment terminated, and such
obligations shall survive the Termination Date. If at any time any payment of
the principal of or interest on the Note or any other amount payable by any
Pledgor under this Agreement is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of such Pledgor or
otherwise, the other Pledgor's obligations hereunder with respect to such
payment shall be reinstated at such time as though such payment had been due
but not made at such time.
(d) Each Pledgor irrevocably waives acceptance hereof, presentment,
demand, protest and any notice not provided for herein, as well as any
requirement that at any time any right be exhausted or any action be taken by
the Bank or any other Person. against the other Pledgor or any other Person or
the Pledged Collateral or any other collateral security.
(e) upon making by either Pledgor of any payment in respect of the
Obligations of the other Pledgor, such Pledgor shall be subrogated to the
rights of the Bank against such other Pledgor with respect to such payment;
provided that such Pledgor shall not enforce any right or demand or receive any
payment by way of subrogation until all amounts of principal of and interest on
the Note and all other amounts payable under this Agreement and the Credit
Agreement have been paid in full and the Commitment shall have been terminated.
SECTION 21. Section Headings. The section headings herein are for
convenience of reference only, and shall not affect in any way the
interpretation of any of the provisions hereof.
SECTION 22. Execution in Counter Parts. This Agreement may be executed
in any number of counterparts, each of which shall be an original, but all of
which shall together constitute one and the same agreement.
SECTION 23. Merger. This Agreement represents the final agreement each
of the Pledgors with respect to the matters contained herein and may not be
contradicted by evidence of prior or contemporaneous agreements, or subsequent
oral agreements, between such Pledgor and the Bank.
13
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IN WITNESS WHEREOF, the Pledgors and the Bank have caused this
Agreement to be duly executed and delivered as of the date first above written.
EQUITY HOLDINGS LIMITED, an Illinois limited
partnership
By: ▇▇▇▇▇▇ ▇▇▇▇ Revocable Trust established
under Trust Agreement dated January 17, 1990,
its General Partner
By: /s/
--------------------------
▇▇▇▇▇▇ ▇▇▇▇, Trustee
By: ▇▇▇▇▇▇ ▇. and B. ▇▇▇ ▇▇▇▇▇ Trust established
under Trust Agreement establishing the ▇▇▇▇▇▇ ▇▇▇▇▇
Revocable Trust dated December 19, 1989, its General
Partner
By: /s/
--------------------------
, Trustee
-----------
RIVERSIDE PARTNERS, an Illinois limited partnership
By: ▇▇▇▇▇▇ ▇▇▇▇ Revocable Trust established under
Trust Agreement dated January 17, 1990, its
General Partner
By: /s/
--------------------------
▇▇▇▇▇▇ ▇▇▇▇, Trustee
By: ▇▇▇▇▇▇ ▇. and B. ▇▇▇ ▇▇▇▇▇ Trust established
under Trust Agreement establishing the ▇▇▇▇▇▇ ▇▇▇▇▇
Revocable Trust dated December 19, 1989, its
General Partner
By: /s/
--------------------------
, Trustee
-----------
14
15
CITIBANK, N.A.
By:___________________
Title:
15
16
SCHEDULE I
Attached to and forming a part of that
certain Pledge Agreement dated as of February 16, 1994, by
Equity Holdings Limited,
Riverside Partners
and
Citibank, N.A.
% of Certificate Number of
Pledgor Stock Issuer Outstanding Number Shares
-------------------- ----------- ---------- ----------
Limited
Great American 1.84% C 3786 204,795
Management and
Investment, Inc. 0.90% SO 102 100,000
0.90% SO 103 100,000
0.54% SO 001 50,000
Itel Corporation 0.30% NI 38558 100,000
0.30% NI 38559 100,000
0.30% NI 31846 100,000
0.30% NI 31847 100,000
0.30% NI 31848 100,000
17
EXHIBIT A
Pledge Agreement
as of February 16, 1994
FORM OF
PLEDGE CERTIFICATE
with in pledge to the Bank, pursuant to Section
7(b) of that certain Pledge Agreement dated February 16, 1994 by and among
Equity Holdings Limited, Riverside Partners and Citibank, N.A. (the "Pledge
Agreement", terms defined therein and not otherwise defined herein being used
herein as therein defined) are the following shares of stock that Pledgor
requests become and be Additional Collateral:
% of Certificate Number of
Pledgor Stock Issuer outstanding Number Shares
The Pledgor hereby pledges to the Bank, and grants to the Bank a
security interest in the above listed shares and the certificates representing
the above listed shares, and all dividends, 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 above listed shares.
The Pledgor hereby represents and warrants as follows:
(a) The above listed shares have been duly authorized and validly
issued and are fully paid and non-assessable.
(b) The Pledgor is the legal and beneficial owner of the above listed
shares, free and clear of any lien, security interest, option or other charge
or encumbrance except for the security interest created by this Pledge
Certificate and the Pledge Agreement and the Pledgor has full power to pledge
the above listed shares.
(c) The Pledge Agreement creates a valid and perfected first priority
security interest in the above listed shares, securing the payment of the
Obligations.
(d) The Pledgor has the right to vote, pledge and grant a security
interest in or otherwise transfer the above listed shares, free of any security
interest, lien, claim or encumbrance.
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(e) No consent of any other person or entity and no authorization,
approval, or other action by, and no notice to or filing with, any governmental
authority or regulatory body is required (i) for the pledge by the Pledgor of
the above listed shares, (ii) for the perfection or maintenance of the security
interest created hereby (including the first priority nature of such security
interest) or (iii) for the exercise by the Bank of the voting or other rights
provided for in the Pledge Agreement or the remedies in respect of such
Additional Collateral pledged hereunder (except as may be required in
connection with any disposition of any portion of such Additional Collateral by
laws affecting the offering and sale of securities generally).
(f) The above listed shares constitute the percentage of the issued
and outstanding shares of stock of the respective hereof indicated above.
(g) The above listed shares have been beneficially owned by such
Pledgor for a period of at least three (3) years prior to the date hereof.
[NAME OF PLEDGOR], an Illinois limited
partnership
By: ▇▇▇▇▇▇ ▇▇▇▇ Revocable Trust
established under Trust Agreement dated
January 17 1990 its General Partner
By:_____________________
▇▇▇▇▇▇ ▇▇▇▇, Trustee
By: ▇▇▇▇▇▇ ▇. and B. ▇▇▇ ▇▇▇▇▇ Trust
established under Trust Agreement
establishing the ▇▇▇▇▇▇ ▇▇▇▇▇ Revocable
Trust dated December 19, 1989, its
General Partner
By:_____________________
______________, Trustee
Acknowledged and agreed this ____ day
of _____________, 199_,
CITIBANK, N.A.
By:___________________
Title:
2
19
CITIBANK, N.A.
/s/ By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------
Title: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
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