Exhibit 10.2
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PLEDGE AND GUARANTEE AGREEMENT
by
HOMEBASE ACQUISITION, LLC,
as Pledgor,
CITICORP NORTH AMERICA, INC.,
as Collateral Agent
for the First Priority Secured Parties,
and
▇▇▇▇▇ FARGO BANK, N.A.,
as Collateral Agent for the
Second Priority Secured Parties
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Dated as of April 14, 2004
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TABLE OF CONTENTS
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SECTION 1. Certain Definitions................................................. 2
SECTION 2. Non-Recourse Guarantee of First Priority Secured Obligations........ 5
SECTION 3. Non-Recourse Guarantee of Second Priority Secured Obligations....... 6
SECTION 4. Pledge for First Priority Secured Obligations....................... 7
SECTION 5. Pledge for Second Priority Secured Obligations...................... 7
SECTION 6. Delivery of the Pledged Stock....................................... 7
SECTION 7. Representations, Warranties and Covenants........................... 8
SECTION 8. Registration in Nominee Name; Denominations......................... 8
SECTION 9. Voting Rights; Dividends and Interest, etc.......................... 9
SECTION 10. Establishment of Collateral Account................................. 10
SECTION 11. Remedies upon Default............................................... 11
SECTION 12. Application of Proceeds............................................. 13
SECTION 13. Applicable Collateral Agent's Calculations.......................... 14
SECTION 14. Collateral Agents Appointed Attorneys-in-Fact....................... 14
SECTION 15. Intercreditor Matters............................................... 15
SECTION 16. Waivers; Amendment.................................................. 20
SECTION 17. Securities Act, etc................................................. 21
SECTION 18. Registration, etc................................................... 22
SECTION 19. Termination or Release.............................................. 22
SECTION 20. Notices............................................................. 23
SECTION 21. Further Assurances.................................................. 25
SECTION 22. Survival of Agreement; Severability................................. 25
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SECTION 23. GOVERNING LAW....................................................... 26
SECTION 24. Counterparts........................................................ 26
SECTION 25. Rules of Interpretation............................................. 26
SECTION 26. Jurisdiction; Consent to Service of Process......................... 26
SECTION 27. WAIVER OF JURY TRIAL................................................ 26
SECTION 28. Execution of Financing Statements................................... 27
SECTION 29. Resignation of the Second Priority Collateral Agent................. 27
SCHEDULES
Schedule I Subsidiaries
Schedule II Pledged Stock
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PLEDGE AND GUARANTEE AGREEMENT
PLEDGE AND GUARANTEE AGREEMENT (as amended, amended and restated,
supplemented or otherwise modified from time to time, this "Agreement") dated as
of April 14, 2004, among HOMEBASE ACQUISITION, LLC, a Delaware limited liability
company ("Pledgor"), CITICORP NORTH AMERICA, INC., as collateral agent (in such
capacity, and together with any successors in such capacity, the "First Priority
Collateral Agent") for the First Priority Secured Parties (as defined below),
and ▇▇▇▇▇ FARGO BANK, N.A., as collateral agent (in such capacity, and together
with any successors in such capacity, the "Second Priority Collateral Agent")
for the Second Priority Secured Parties (as defined below).
R E C I T A L S
A. Pledgor, Consolidated Communications Texas Holdings, Inc.
("CCI Texas Holdings"), a Delaware corporation, Consolidated Communications
Illinois Holdings, Inc. ("CCI Illinois Holdings"), a Delaware corporation,
Consolidated Communications, Inc. (the "CCI Borrower"), an Illinois corporation,
Consolidated Communications Acquisition Texas, Inc. (the "CCI Texas Borrower"
and, together with the CCI Borrower, the "Borrowers"), Citicorp North America,
Inc., as Administrative Agent, Credit Suisse First Boston ("CSFB") and Deutsche
Bank Securities Inc., as Co-Syndication Agents, CSFB and Citigroup Global
Markets Inc., as Joint Lead Arrangers and Joint Lead Bookrunners, CoBank, ACB,
as documentation agent, and the lending institutions from time to time party
thereto (in their capacities as lenders, the "Lenders") have, in connection with
the execution and delivery of this Agreement, entered into that certain credit
agreement, dated as of April 14, 2004 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
providing for the making of Loans (as defined in the Credit Agreement) to the
Borrowers and the issuance of and participations in Letters of Credit (as
defined in the Credit Agreement) for the account of the Borrowers, pursuant to,
and upon the terms and subject to the conditions specified in, the Credit
Agreement.
B. Pledgor, CCI Texas Holdings, CCI Illinois Holdings and ▇▇▇▇▇
Fargo Bank, N.A., as trustee, have entered into the Indenture (the "Indenture"),
dated as of April 14, 2004, providing for the issuance of the Notes (as defined
in the Indenture), pursuant to, and upon the terms and subject to the conditions
specified in, the Credit Agreement.
C. Pledgor will receive substantial benefits from the execution,
delivery and performance of the obligations under the Credit Agreement, the
Indenture and the Notes and is, therefore, willing to enter into this Agreement.
D. The First Priority Collateral Agent and the Second Priority
Collateral Agent wish to enter into this Agreement in order to, among other
things, establish the relative priority of their respective Liens on the
Collateral.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Pledgor, the First Priority
Collateral Agent and the Second Priority Collateral Agent hereby agree as
follows:
SECTION 1. Certain Definitions. Capitalized terms used without
definition herein shall have the meanings given such terms by the UCC.
Additionally, the following terms shall have the following meanings for purposes
of this Agreement:
"Applicable Collateral Agent" shall mean, prior to the Discharge of
First Priority Secured Obligations, the First Priority Collateral Agent and,
following the Discharge of First Priority Secured Obligations, the Second
Priority Collateral Agent.
"Bankruptcy Code" shall mean Title 11 of the United States Code, as
now constituted or hereafter amended.
"Collateral" means (a) all the Equity Interests of CCI Illinois
Holdings and CCI Texas Holdings now owned or hereafter acquired by Pledgor (the
"Pledged Stock"), (b) subject to Section 9, all payments of capital or
dividends, cash instruments and other property from time to time received,
receivable or otherwise distributed in respect of, in exchange for or upon the
conversion of the Pledged Stock, (c) the Collateral Account and all Collateral
Account Funds, (d) subject to Section 9, all rights and privileges of the
Pledgor with respect to the securities and other property referred to clauses
(a), (b) and (c) above, and (e) all proceeds of any and all of the foregoing.
For the avoidance of doubt, the Collateral shall not include any cash dividends
paid to Pledgor in compliance with Section 6.07 of the Credit Agreement and
Section 4.09 of the Indenture.
"Collateral Account" shall mean that collateral account established
pursuant to Section 10 of this Agreement.
"Collateral Account Funds" shall mean, collectively, the following
from time to time on deposit in the Collateral Account: all funds, investments
(including, without limitation, all Permitted Investments or Temporary Cash
Investments) and all certificates and instruments from time to time representing
or evidencing such investments; all notes, certificates of deposit, checks and
other instruments from time to time hereafter delivered to or otherwise
possessed by the Applicable Collateral Agent for or on behalf of Pledgor in
substitution for, or in addition to, any or all of the Collateral; and all
interest, 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 items constituting Collateral.
"Control" shall mean (i) in the case of a Deposit Account,
"control," as such term is defined in Section 9-104 of the UCC and (ii) in the
case of a Security Entitlement, "control," as such term is defined in Section
8-106(d) of the UCC.
"Control Agreement" shall mean an agreement in form and substance
acceptable to the Applicable Collateral Agent for the purpose of effecting
Control with respect to the Collateral Account and any Collateral Account Funds.
"Discharge of First Priority Secured Obligations" shall mean the
occurrence of all of the following: (i) termination of all commitments to extend
credit that would constitute First Priority Secured Obligations, (ii) payment in
full in cash of all First Priority Secured Obligations,
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(iii) termination, cancellation or cash collateralization of all outstanding
Letters of Credit (as defined in the Credit Agreement) constituting First
Priority Secured Obligations.
"Equity Interests" means shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person.
"Event of Default" shall mean an Event of Default as defined in
either the Credit Agreement or the Indenture.
"FCC" means the Federal Communications Commission, or any other
similar or successor agency of the federal government administering the
Communications Act of 1934, as amended, or any similar or successor federal
statute, and the rules and regulations thereunder.
"First Priority Secured Obligations" means (a) the unpaid principal
of and interest on (including interest accruing after the maturity of the Loans
made to either Borrower and interest accruing after the filing of any petition
in bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to either Borrower, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding) the Loans made to or LC
Disbursements (as defined in the Credit Agreement) made pursuant to Letters of
Credit issued for the account of either Borrower and all other obligations and
liabilities of any Loan Party (as defined in the Credit Agreement) to any Agent
(as defined in the Credit Agreement), the Issuing Bank (as defined in the Credit
Agreement) or to any Lender, whether direct or indirect, absolute or contingent,
due or to become due, or now existing or hereafter incurred, which may arise
under, out of, or in connection with, the Credit Agreement, any other Loan
Document (as defined in the Credit Agreement) or any other document made,
delivered or given in connection therewith, whether on account of principal,
interest, fees, indemnities, costs or expenses (including, without limitation,
all reasonable fees, charges and disbursements of counsel), or otherwise, and
(b) the due and punctual payment and performance by each Loan Party under each
Hedging Agreement (as defined in the Credit Agreement) relating to the Loans
entered into with any counterparty that was a Lender or an Affiliate (as defined
in the Credit Agreement) of a Lender at the time such Hedging Agreement was
entered into.
"First Priority Secured Parties" means the "Secured Parties" as
defined in the Security Agreement, dated as of April 14, 2004, by and among CCI
Illinois Holdings, CCI Texas Holdings, the Borrowers, the other Grantors named
therein and the First Priority Collateral Agent.
"Governmental Authority" means any Federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory body,
including any central bank, including, without limitation, the Federal
Communications Commission, the Texas Public Utilities Commission and the
Illinois Commerce Commission.
"Person" means any natural person, corporation, trust, joint
venture, association, company, partnership, limited liability company or
government, or any agency or political subdivision thereof.
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"Proceeding" shall mean, with respect to any person, any (a)
insolvency, bankruptcy, receivership, reorganization, readjustment, composition
or other similar proceeding relating to such person or its property or creditors
in such capacity, (b) proceeding for any liquidation, dissolution or other
winding-up of such person, voluntary or involuntary, whether or not involving
insolvency or proceedings under the Bankruptcy Code, whether partial or complete
and whether by operation of law or otherwise, (c) assignment for the benefit of
creditors of such person or (d) other marshalling of the assets of such person.
"PUC" means any state, provincial or other local regulatory agency
or body that exercises jurisdiction over the rates or services or the ownership,
construction or operation of any Telecommunications System or over Persons who
own, construct or operate a Telecommunications System, including without
limitation, the Illinois Commerce Commission and the Public Utility Commission
of Texas, in each case by reason of the nature or type of the business subject
to regulation and not pursuant to laws and regulations of general applicability
to Persons conducting business in any such jurisdiction.
"Requirement of Law" means, as to any Person, any law, treaty, rule
or regulation or determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or any of its
property or assets or to which such Person or any of its property or assets is
subject.
"Second Priority Secured Obligations" means the unpaid principal of
and interest on (including (i) Additional Interest (as defined in the
Registration Rights Agreement (as defined in the Indenture)), (ii) interest
accruing after the maturity of the Notes and (iii) interest accruing after the
filing of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to CCI Illinois Holdings or CCI
Texas Holdings, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding) the Notes (including Additional Notes (as defined
in the Indenture), if any) and all other obligations of CCI Illinois Holdings or
CCI Texas Holdings to the Trustee, the holders of Notes or the Second Priority
Collateral Agent which may arise under, out of or in connection with this
Agreement or the Indenture, in each case, whether direct or indirect, absolute
or contingent, due or to become due, or now existing or hereafter incurred.
"Second Priority Secured Parties" means the Trustee, each holder of
a Note from time to time and the Second Priority Collateral Agent.
"Secured Obligations" means collectively, the First Priority Secured
Obligations and the Second Priority Secured Obligations.
"Secured Parties" means, collectively, the First Priority Secured
Parties and the Second Priority Secured Parties.
"Telecommunications System" means a telephone, long distance,
internet, data services, video and satellite services, wireless
telecommunications, telephone directories, fiber and cable leasing,
telecommunications equipment, including hand sets, rental, leasing,
installation, selling or maintenance system or business and shall include a
microwave system or a pag-
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ing system operated in connection with (and in the same general service area as)
any of the foregoing systems, and businesses related thereto.
"UCC" shall mean the Uniform Commercial Code as in effect on the
date hereof in the State of New York; provided, however, that if by reason of
mandatory provisions of law, any or all of the attachment, perfection or
priority of the security interests granted hereunder in any item or portion of
the Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, the term "UCC" shall mean the
Uniform Commercial Code as in effect on the date hereof in such other
jurisdiction for purposes of the provisions hereof relating to such attachment,
perfection or priority and for purposes of definitions relating to such
provisions.
SECTION 2. Non-Recourse Guarantee of First Priority Secured
Obligations. Pledgor agrees as follows:
(a) Pledgor hereby guarantees to the First Priority Secured
Parties the prompt payment in full when due of the First Priority Secured
Obligations.
(b) The guarantee hereunder is a continuing guarantee, and shall
apply to all First Priority Secured Obligations whenever arising.
(c) The guarantee hereunder is without recourse to anything other
than the Collateral and Pledgor shall have no obligation to the First
Priority Secured Parties to pay any First Priority Secured Obligation
other than with the Collateral.
(d) Except as provided in clause (c) above, the obligations of
Pledgor hereunder are absolute and unconditional irrespective of the
value, genuineness, validity, regularity or enforceability of any Loan
Document or any other agreement or instrument referred to herein or
therein, or any substitution, release or exchange of any other guarantee
of or security for any of the First Priority Secured Obligations, and, to
the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever that might otherwise constitute a legal or
equitable discharge or defense of a surety or guarantor, it being the
intent of this agreement that the obligations of Pledgor hereunder shall
be absolute and unconditional under any and all circumstances. Without
limiting the generality of the foregoing, it is agreed that the occurrence
of any one or more of the following shall not alter or impair the
liability of Pledgor hereunder, which shall remain absolute and
unconditional as described above:
(i) at any time or from time to time, without notice to Pledgor,
the time for any performance of or compliance with any of the First
Priority Secured Obligations shall be extended, or such performance or
compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of the
Credit Agreement or of the other Loan Documents or any other agreement or
instrument referred to herein or therein shall be done or omitted (other
than a Discharge of First Priority Secured Obligations);
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(iii) the maturity of any of the First Priority Secured Obligations
shall be accelerated, or any of the First Priority Secured Obligations
shall be modified, supplemented or amended in any respect, or any right
hereunder or under the other Loan Documents or any other agreement or
instrument referred to herein or therein shall be waived or any other
guarantee of any of the First Priority Secured Obligations or any security
therefor shall be released or exchanged in whole or in part or otherwise
dealt with; or
(iv) any lien or security interest granted to, or in favor of any
First Priority Secured Party as security for any of the First Priority
Secured Obligations shall fail to be perfected.
(e) The Pledgor hereby expressly waives diligence, presentment,
demand of payment, protest and all notices whatsoever, and any requirement
that the First Priority Collateral Agent or any other First Priority
Secured Party exhaust any right, power or remedy or proceed against the
Borrowers under the Credit Agreement or under the other Loan Documents or
any other agreement or instrument referred to herein or therein, or
against any other Person under any other guarantee of, or security for,
any of the First Priority Secured Obligations.
SECTION 3. Non-Recourse Guarantee of Second Priority Secured
Obligations. Pledgor agrees as follows:
(a) Pledgor hereby guarantees to the Second Priority Secured
Parties the prompt payment in full when due of the Second Priority Secured
Obligations.
(b) The guarantee hereunder is a continuing guarantee, and shall
apply to all Second Priority Secured Obligations whenever arising.
(c) The guarantee hereunder is without recourse to anything other
than the Collateral and Pledgor shall have no obligation to the Second
Priority Secured Parties to pay any Second Priority Secured Obligation
other than with the remaining Collateral after Discharge of First Priority
Secured Obligations.
(d) Except as provided in clause (c) above, the obligations of
Pledgor hereunder are absolute and unconditional irrespective of the
value, genuineness, validity, regularity or enforceability of the
Indenture or the Notes or any other agreement or instrument referred to
herein or therein, or any substitution, release or exchange of any other
guarantee of or security for any of the Second Priority Secured
Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this agreement that the obligations of
Pledgor hereunder shall be absolute and unconditional under any and all
circumstances. Without limiting the generality of the foregoing, it is
agreed that the occurrence of any one or more of the following shall not
alter or impair the liability of Pledgor hereunder, which shall remain
absolute and unconditional as described above:
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(i) at any time or from time to time, without notice to Pledgor,
the time for any performance of or compliance with any of the Second
Priority Secured Obligations shall be extended, or such performance or
compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of the
Indenture or the Notes or any other agreement or instrument referred to
herein or therein shall be done or omitted (other than a satisfaction and
discharge of the Indenture in accordance with its terms);
(iii) the maturity of any of the Second Priority Secured Obligations
shall be accelerated, or any of the Second Priority Secured Obligations
shall be modified, supplemented or amended in any respect, or any right
hereunder or under the Indenture or the Notes or any other agreement or
instrument referred to herein or therein shall be waived or any other
guarantee of any of the Second Priority Secured Obligations or any
security therefor shall be released or exchanged in whole or in part or
otherwise dealt with; or
(iv) any lien or security interest granted to, or in favor of any
Second Priority Secured Party as security for any of the Second Priority
Secured Obligations shall fail to be perfected.
(e) Pledgor hereby expressly waives diligence, presentment, demand
of payment, protest and all notices whatsoever, and any requirement that
the First Priority Collateral Agent or any other First Priority Secured
Party exhaust any right, power or remedy or proceed against CCI Illinois
Holdings or CCI Texas Holdings under the Indenture or the Notes or any
other agreement or instrument referred to herein or therein, or against
any other Person under any other guarantee of, or security for, any of the
Second Priority Secured Obligations.
SECTION 4. Pledge for First Priority Secured Obligations. As
security for the payment and performance, as the case may be, in full of the
First Priority Secured Obligations, Pledgor hereby grants to the First Priority
Collateral Agent, for the ratable benefit of the First Priority Secured Parties,
a first priority security interest in all of Pledgor's right, title and interest
in, to and under the Collateral.
SECTION 5. Pledge for Second Priority Secured Obligations. As
security for the payment and performance, as the case may be, in full of the
Second Priority Secured Obligations, Pledgor hereby grants to the Second
Priority Collateral Agent, for the ratable benefit of the Second Priority
Secured Parties, a second priority security interest in all of Pledgor's right,
title and interest in, to and under the Collateral; provided that the Lien
granted pursuant to this Section 5 shall be subject and subordinate to the Lien
granted to secure the First Priority Secured Obligations pursuant to the
immediately preceding clause and further subject to the provisions of Section
15.
SECTION 6. Delivery of the Pledged Stock. (a) Pledgor agrees to
promptly deliver or cause to be delivered to the Applicable Collateral Agent any
and all Pledged Stock.
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(b) Pledgor shall cause all Equity Interests now or hereafter
acquired by it constituting Pledged Stock to be certificated.
SECTION 7. Representations, Warranties and Covenants. Pledgor hereby
represents, warrants and covenants, as to itself and the Collateral pledged by
it hereunder, to and with the First Priority Collateral Agent and the Second
Priority Collateral Agent that:
(a) the Pledged Stock represents that percentage as set forth on
Schedule II of the issued and outstanding shares of each class of the
capital stock or other Equity Interests of the issuer with respect
thereto;
(b) except for the security interest granted hereunder, Pledgor
(i) is the direct owner, beneficially and of record, of the Pledged Stock
indicated on Schedule II, (ii) holds the same free and clear of all Liens,
(iii) will make no assignment, pledge, hypothecation or transfer of, or
create or permit to exist any security interest in or other Lien on, the
Collateral, other than pursuant hereto, and (iv) subject to Section 9,
will cause any and all Pledged Stock, whether for value paid by Pledgor or
otherwise, to be forthwith deposited with the Applicable Collateral Agent
and pledged or assigned hereunder;
(c) Pledgor (i) has the power and authority to pledge the
Collateral in the manner hereby done or contemplated and (ii) will defend
its title or interest thereto or therein against any and all Liens (other
than the Lien created by this Agreement), however arising, of all Persons
whomsoever;
(d) by virtue of the execution and delivery by Pledgor of this
Agreement, when the Pledged Stock, certificates or other documents
representing or evidencing the Collateral are delivered to the Applicable
Collateral Agent in accordance with this Agreement, the First Priority
Collateral Agent will obtain a valid and perfected first priority lien
upon and security interest in such Pledged Stock under New York law as
security for the payment and performance of the First Priority Secured
Obligations and the Second Priority Collateral Agent will obtain a valid
and perfected second priority lien upon and security interest in such
Pledged Stock under New York law as security for the payment and
performance of the Second Priority Secured Obligations;
(e) all of the Pledged Stock has been duly authorized and validly
issued and is fully paid and nonassessable; and
(f) all information set forth herein relating to the Pledged Stock
is accurate and complete in all material respects as of the date hereof.
SECTION 8. Registration in Nominee Name; Denominations. The
Applicable Collateral Agent, in its capacity as such, shall have the right (in
its sole and absolute discretion) to hold the Pledged Stock in its own name as
pledgee, the name of its nominee (as pledgee or as sub-agent) or the name of the
Pledgor, endorsed or assigned in blank or in favor of the Applicable Collateral
Agent; provided that the Applicable Collateral Agent shall not exercise any
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such right without the prior consent of Pledgor in the event an Event of Default
is not continuing. During the continuance of any Event of Default, Pledgor will
promptly give to the Applicable Collateral Agent copies of any notices or other
communications received by it with respect to Pledged Stock registered in the
name of Pledgor. During the continuance of any Event of Default, the Applicable
Collateral Agent shall at all times have the right to exchange the certificates
representing Pledged Stock for certificates of smaller or larger denominations
for any purpose consistent with this Agreement.
SECTION 9. Voting Rights; Dividends and Interest, etc. (a) Unless
and until an Event of Default shall have occurred and be continuing:
(i) Pledgor shall have the right to exercise any and all voting
and/or other consensual rights and powers inuring to an owner of Pledged
Stock or any part thereof for any purpose consistent with the terms of
this Agreement, the Credit Agreement, the other Loan Documents, the
Indenture or the Notes; provided, however, that Pledgor will not be
entitled to exercise any such right if the result thereof could reasonably
be expected to materially and adversely affect the rights and remedies of
any of the Secured Parties under this Agreement, the Credit Agreement, any
other Loan Document, the Indenture or the Notes or the ability of the
applicable Secured Parties to exercise the same;
(ii) The Applicable Collateral Agent shall execute and deliver to
Pledgor, or cause to be executed and delivered to Pledgor, all such
proxies, powers of attorney and other instruments as Pledgor may
reasonably request for the purpose of enabling Pledgor to exercise the
voting and/or consensual rights and powers it is entitled to exercise
pursuant to subparagraph (i) above and to receive the cash dividends it is
entitled to receive pursuant to subparagraph (iii) below; and
(iii) Subject to the next sentence, Pledgor shall be entitled to
receive and retain, free and clear from the liens granted hereby, any and
all cash dividends, interest, principal and other amounts paid on the
Pledged Stock to the extent and only to the extent that such cash
dividends, interest, principal and other amounts are permitted by, and
otherwise paid in accordance with, the terms and conditions of the Credit
Agreement, the other Loan Documents, the Indenture, the Notes and
applicable laws. All noncash dividends, interest, principal and other
amounts, and all dividends, interest, principal and other amounts paid or
payable in cash or otherwise in connection with a partial or total
liquidation or dissolution, return of capital, capital surplus or paid-in
surplus, and all other distributions (other than distributions referred to
in the preceding sentence) made on or in respect of the Pledged Stock,
whether paid or payable in cash or otherwise, whether resulting from a
subdivision, combination or reclassification of the outstanding capital
stock of the issuer of any Pledged Stock or received in exchange for
Pledged Stock or any part thereof, or in redemption thereof, or as a
result of any merger, consolidation, acquisition or other exchange of
assets to which such issuer may be a party or otherwise, shall be and
become part of the Collateral, and, if received by Pledgor, shall be
forthwith delivered to the Applicable Collateral Agent in the same form as
so received (with any necessary endorsement).
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(b) Following any acceleration of all or part of the Secured
Obligations, all rights of Pledgor to dividends, interest, principal or other
amounts that Pledgor is authorized to receive pursuant to paragraph (a)(iii)
above shall cease, and all such rights shall thereupon become vested in the
Applicable Collateral Agent, which shall have the sole and exclusive right and
authority to receive and retain such dividends, interest, principal or other
amounts. All dividends, interest, principal or other amounts received by Pledgor
contrary to the provisions of this Section 9 shall be held in trust for the
benefit of the Applicable Collateral Agent, shall be segregated from other
property or funds of such Pledgor and shall be forthwith delivered to the
Applicable Collateral Agent upon demand in the same form as so received (with
any necessary endorsement). Any and all money and other property paid over to or
received by the Applicable Collateral Agent pursuant to the provisions of this
paragraph (b) shall be retained by the Applicable Collateral Agent in the
Collateral Account established pursuant to Section 10 and shall be applied in
accordance with the provisions of Section 12.
(c) Upon the occurrence and during the continuance of an Event of
Default, all rights of Pledgor to exercise the voting and consensual rights and
powers it is entitled to exercise pursuant to paragraph (a)(i) of this Section
9, and the obligations of the Applicable Collateral Agent under paragraph
(a)(ii) of this Section 9, shall cease, and all such rights shall thereupon
become vested in the Applicable Collateral Agent, which shall have the sole and
exclusive right and authority to exercise such voting and consensual rights and
powers. After all Events of Default have been cured or waived, Pledgor will have
the right to exercise the voting and consensual rights and powers that it would
otherwise be entitled to exercise pursuant to the terms of paragraph (a)(i)
above.
SECTION 10. Establishment of Collateral Account. The Applicable
Collateral Agent is hereby authorized to establish and maintain at its office,
in the name of the Applicable Collateral Agent and pursuant to a Control
Agreement, a restricted deposit account designated "Homebase Acquisition, LLC
Collateral Account." Pledgor shall deposit into the Collateral Account from time
to time all amounts required to be deposited in the Collateral Account by
Section 9.
The balance from time to time in the Collateral Account shall
constitute part of the Collateral and shall not constitute payment of the
Secured Obligations until applied as hereinafter provided.
Amounts on deposit in the Collateral Account shall be invested from
time to time in, prior to the Discharge of First Priority Secured Obligations,
Permitted Investments (as defined in the Credit Agreement) and following the
Discharge of First Priority Secured Obligations, Temporary Cash Investments (as
defined in the Indenture), as the Applicable Collateral Agent shall determine,
which Permitted Investments or Temporary Cash Investments shall be held in the
name and be under the control of the Applicable Collateral Agent (or any
subagent); provided, that at any time after the occurrence and during the
continuance of an Event of Default, the Applicable Collateral Agent may, in its
discretion, at any time and from time to time elect to liquidate any such
Permitted Investments or Temporary Cash Investments, as the case may be,
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and to apply or cause to be applied the proceeds thereof to the payment of the
Secured Obligations in the manner specified in Section 12.
SECTION 11. Remedies upon Default. (a) Upon the occurrence and
during the continuance of an Event of Default, subject to applicable regulatory
and legal requirements, the Applicable Collateral Agent may sell or otherwise
dispose of the Collateral, or any part thereof, at public or private sale or at
any broker's board or on any securities exchange, for cash, upon credit or for
future delivery as the Applicable Collateral Agent shall deem appropriate;
provided that any disposition of Collateral by private sale be deemed to have
been made in a commercially reasonable manner. Each such purchaser at any such
sale shall hold the property sold absolutely free from any claim or right on the
part of Pledgor, and, to the extent permitted by applicable law, Pledgor hereby
waives all rights of redemption, stay, valuation and appraisal that Pledgor now
has or may at any time in the future have under any rule of law or statute now
existing or hereafter enacted.
(b) The Applicable Collateral Agent shall give Pledgor ten (10)
Business Days' prior written notice (which each Pledgor agrees is reasonable
notice within the meaning of Section 9-611 of the Uniform Commercial Code as in
effect in the State of New York or its equivalent in other jurisdictions (the
"UCC")) of the Applicable Collateral Agent's intention to make any sale or other
disposition of Pledgor's Collateral. Such notice, in the case of a public sale,
shall state the time and place for such sale and, in the case of a sale at a
broker's board or on a securities exchange, shall state the board or exchange at
which such sale is to be made and the day on which the Collateral, or portion
thereof, will first be offered for sale at such board or exchange. Any such
public sale shall be held at such time or times within ordinary business hours
and at such place or places as the Applicable Collateral Agent may fix and state
in the notice of such sale. At any such sale, the Collateral, or portion
thereof, to be sold may be sold in one lot as an entirety or in separate
parcels, as the Applicable Collateral Agent may (in its sole and absolute
discretion) determine. The Applicable Collateral Agent shall not be obligated to
make any sale of any Collateral if it shall determine not to do so, regardless
of the fact that notice of sale of such Collateral shall have been given. The
Applicable Collateral Agent may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned from time to time by
announcement at the time and place fixed for sale, and such sale may, without
further notice, be made at the time and place to which the same was so
adjourned. In case any sale of all or any part of the Collateral is made on
credit or for future delivery, the Collateral so sold may be retained by the
Applicable Collateral Agent until the sale price is paid in full by the
purchaser or purchasers thereof, but the Applicable Collateral Agent shall not
incur any liability in case any such purchaser or purchasers shall fail to take
up and pay for the Collateral so sold and, in case of any such failure, such
Collateral may be sold again upon like notice. At any public (or, to the extent
permitted by applicable law, private) sale made pursuant to this Section 11, any
Secured Party may bid for or purchase, free from any right of redemption, stay,
valuation or appraisal on the part of Pledgor (all said rights being also hereby
waived and released), the Collateral or any part thereof offered for sale and
may make payment on account thereof by using any Secured Obligation then due and
payable to such Secured Party from any Pledgor as a credit against the purchase
price, and such Secured Party may, upon compliance with the terms of sale, hold,
retain and dispose of such property without further accountability to Pledgor
therefor; provided that the
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Applicable Collateral Agent shall not be required to accept any such bid if it
concludes that doing so would be inconsistent with Section 12 or Section 14. For
purposes hereof, (i) a written agreement to purchase the Collateral or any
portion thereof shall be treated as a sale thereof, (ii) the Applicable
Collateral Agent shall be free to carry out such sale pursuant to such agreement
and (iii) Pledgor shall not be entitled to the return of the Collateral or any
portion thereof subject thereto, notwithstanding the fact that after the
Applicable Collateral Agent shall have entered into such an agreement all Events
of Default shall have been remedied and the Secured Obligations paid in full. As
an alternative to exercising the power of sale herein conferred upon it, the
Applicable Collateral Agent may proceed by a suit or suits at law or in equity
to foreclose upon the Collateral and to sell the Collateral or any portion
thereof pursuant to a judgment or decree of a court or courts having competent
jurisdiction or pursuant to a proceeding by a court-appointed receiver.
(c) Notwithstanding anything to the contrary in this Agreement,
any foreclosure on, sale, transfer or other disposition of, or the exercise or
relinquishment of any right to vote or consent with respect to, any of the
Collateral by the Applicable Collateral Agent shall, to the extent required, be
in conformance with Sections 214 and 310(d) of the Communications Act of 1934,
as amended, and the applicable rules and regulations thereunder, and, if and
only to the extent required thereby, subject to the prior approval or notice to
and non-opposition of the FCC or any PUC.
(d) If an Event of Default shall have occurred and be continuing,
Pledgor shall take any action which the Applicable Collateral Agent may
reasonably request in order to transfer or assign, or both, to the Applicable
Collateral Agent, or to such one or more third parties as the Applicable
Collateral Agent may designate, or to a combination of the foregoing, any
Pledged Securities, subject to the prior approval of the FCC or any PUC, if
required. The Applicable Collateral Agent is empowered, to the extent permitted
by applicable Requirements of Law, to request the appointment of a receiver from
any court of competent jurisdiction. Such receiver may be instructed by any
Secured Party to seek from the FCC or any PUC consent to an involuntary transfer
of control of Pledgor or assignment, or both, of the Pledged Securities. Pledgor
hereby agrees to authorize such an involuntary transfer of control or
assignment, or both, upon the request of the receiver so appointed and, if
Pledgor shall refuse to authorize the transfer, its approval may be required by
the court. Upon the occurrence and during the continuance of an Event of
Default, Pledgor agrees to use its best efforts to assist in obtaining approval
of the FCC or any PUC and any other state regulatory bodies, if required, for
any action or transactions contemplated by this Agreement, including, without
limitation, the preparation, execution and filing with the FCC or any PUC and
any other state regulatory bodies of the assignor's or transferor's portion of
any application or applications for consent to the assignment of any Collateral
or other authorization or transfer of control necessary or appropriate under the
rules and regulations of the FCC or PUC or any other state regulatory body for
approval or non-opposition of the transfer or assignment of any portion of the
Collateral, together with any FCC or PUC license, permit, certificate or other
authorization.
(e) Pledgor acknowledges that the assignment or transfer of the
Collateral is integral to Secured Parties' ability to realize the value of the
Collateral, that there is no adequate
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remedy at law for failure by Pledgor to comply with the provisions of this
Section 11 and that such failure would not be adequately compensable in damages,
and therefore agrees, without limiting the right of the Collateral Agent to seek
and obtain specific performance of other obligations of the Pledgors contained
in this Agreement, that the agreements contained in this Section 11 may be
specifically enforced.
SECTION 12. Application of Proceeds. All Proceeds received by the
Applicable Collateral Agent in respect of any sale of, collection from or other
realization upon all or any part of the Collateral pursuant to the exercise by
the Applicable Collateral Agent of its remedies, together with any other moneys
then held by the Applicable Collateral Agent in the Collateral Account shall, to
the extent available for distribution (it being understood that the Applicable
Collateral Agent may liquidate investments prior to maturity in order to make a
distribution pursuant to this Section 12), be distributed by the Applicable
Collateral Agent on each Distribution Date in the following order of priority:
First: to the First Priority Collateral Agent for any unpaid fees
and expenses owed to the First Priority Collateral Agent under the Credit
Agreement, the Indenture or any Loan Document or incurred in connection
with the performance of this Agreement ("Collateral Agent Fees");
Second: without duplication of amounts applied pursuant to clause
First above, to any other Secured Party which has theretofore advanced or
paid any Collateral Agent Fees constituting administrative expenses
allowable under Section 503(b) of the Bankruptcy Code, an amount equal to
the amount thereof so advanced or paid by such Secured Party and for which
such Secured Party has not been reimbursed prior to such Distribution
Date, and, if such moneys shall be insufficient to pay such amounts in
full, then ratably (without priority of any one over any other) to such
Secured Parties in proportion to the amounts of such Collateral Agent Fees
advanced by the respective Secured Parties and remaining unpaid on such
Distribution Date;
Third: without duplication of the amounts applied pursuant to clause
First and Second above, to any Secured Party which has theretofore
advanced or paid any Collateral Agent Fees other than such administrative
expenses, an amount equal to the amount thereof so advanced or paid by
such Secured Party and for which such Secured Party has not been
reimbursed prior to such Distribution Date, and, if such moneys shall be
insufficient to pay such amounts in full, then ratably (without priority
of any one over any other) to such Secured Parties in proportion to the
amounts of such Collateral Agent Fees advanced by the respective Secured
Parties and remaining unpaid on such Distribution Date;
Fourth: without duplication of the amounts applied pursuant to
clauses First, Second and Third above, to the First Priority Secured
Parties, in an amount equal to all unpaid First Priority Obligations,
whether or not then due and payable, and, if such moneys shall be
insufficient to pay such amounts in full, then ratably (without priority
of any one over any other) to such First Priority Secured Parties in
proportion to the unpaid amounts thereof on such Distribution Date;
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Fifth: without duplication of the amounts applied pursuant to
clauses First though Fourth above, to the Second Priority Collateral Agent
for any unpaid fees and expenses owed to the Second Priority Collateral
Agent under the Indenture or incurred in connection with the performance
of this Agreement
Sixth: without duplication of the amounts applied pursuant to
clauses First through Fifth above, to the Second Priority Secured Parties,
in an amount equal to all unpaid Second Priority Obligations, whether or
not then due and payable, and, if such moneys shall be insufficient to pay
such amounts in full, then ratably (without priority of any one over any
other) to such Second Priority Secured Parties in proportion to the unpaid
amounts thereof on such Distribution Date;
Seventh: without duplication of the amounts applied pursuant to
clauses First through Sixth above, any surplus then remaining shall be
paid to Pledgor or its successors or assigns or to whomsoever may be
lawfully entitled to receive the same or as a court of competent
jurisdiction may direct.
SECTION 13. Applicable Collateral Agent's Calculations. In making
the determinations and allocations required by Section 12, the Applicable
Collateral Agent may conclusively rely upon information supplied by the
Administrative Agent or any Secured Party as to the amounts of unpaid principal
and interest and other amounts outstanding with respect to any Secured
Obligations, and the Applicable Collateral Agent shall have no liability to any
of the Secured Parties for actions taken in reliance on such information;
provided that nothing in this sentence shall prevent Pledgor from contesting any
amounts claimed by any Secured Party in any information so supplied. The
Applicable Collateral Agent shall supply copies of any final calculations
received to Pledgor promptly upon receipt thereof. In addition, for purposes of
making the allocations required by Section 12 with respect to any amount that is
denominated in any currency other than Dollars, the Applicable Collateral Agent
shall, on the applicable Distribution Date, convert such amount into an amount
of Dollars based upon the relevant Exchange Rate as of a recent date specified
by the Applicable Collateral Agent in its reasonable discretion. All
distributions made by the Applicable Collateral Agent pursuant to Section 3.01
shall be (subject to any decree of any court of competent jurisdiction) final
(absent manifest error), and the Applicable Collateral Agent shall have no duty
to inquire as to the application by the Administrative Agent of any amounts
distributed to it for distribution to any First Priority Secured Obligations or
to the Trustee of any amounts distributed to it for distribution to any Second
Priority Secured Creditors.
SECTION 14. Collateral Agents Appointed Attorneys-in-Fact. Pledgor
hereby appoints each of the First Priority Collateral Agent and the Second
Priority Collateral Agent as its attorneys-in-fact for the purpose of carrying
out the provisions of this Agreement and taking any action and executing any
instrument that either of them may deem reasonably necessary or advisable to
accomplish the purposes hereof, which appointment is irrevocable and coupled
with an interest, provided that (i) the First Priority Collateral Agent and the
Second Priority Collateral Agent shall only take any action pursuant to such
appointments upon the occurrence and during the continuation of an Event of
Default and (ii) unless it is the Applicable Col-
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lateral Agent at such time, the Second Priority Collateral Agent shall not take
any such action pursuant to such appointment without the consent of the First
Priority Collateral Agent. Without limiting the generality of the foregoing, the
Applicable Collateral Agent shall have the right, upon the occurrence and during
the continuance of an Event of Default, with full power of substitution either
in the Applicable Collateral Agent's name or in the name of Pledgor, to ask for,
demand, ▇▇▇ for, collect, receive and give acquittance for any and all moneys
due or to become due under and by virtue of any Collateral, to endorse checks,
drafts, orders and other instruments for the payment of money payable to Pledgor
representing any interest or dividend or other distribution payable in respect
of the Collateral or any part thereof or on account thereof and to give full
discharge for the same, to settle, compromise, prosecute or defend any action,
claim or proceeding with respect thereto, and to sell, assign, endorse, pledge,
transfer and to make any agreement respecting, or otherwise deal with, the same;
provided, however, that nothing herein contained shall be construed as requiring
or obligating the Applicable Collateral Agent to make any commitment or to make
any inquiry as to the nature or sufficiency of any payment received by the
Applicable Collateral Agent, or to present or file any claim or notice, or to
take any action with respect to the Collateral or any part thereof or the moneys
due or to become due in respect thereof or any property covered thereby. Neither
the Applicable Collateral Agent nor its officers, directors, employees or agents
shall be responsible to Pledgor for any act or failure to act hereunder, except
for their own gross negligence or willful misconduct.
SECTION 15. Intercreditor Matters. (a) The Second Priority
Collateral Agent hereby appoints the First Priority Collateral Agent as its
agent with power and authority to accept, hold, administer and enforce, for the
benefit of the Second Priority Secured Parties, all interests, rights and
remedies under any and all (i) Collateral in which the security interest is
perfected by possession by the First Priority Collateral Agent and (ii)
Investment Property with respect to which the First Priority Collateral Agent is
the registered owner. Upon the Discharge of First Priority Secured Obligations,
the First Priority Collateral Agent shall deliver all Collateral (including any
amounts then remaining in the Collateral Account) in its possession to the
Second Priority Collateral Agent.
(b) The First Priority Collateral Agent hereby acknowledges with
respect to any existing and future Collateral which it holds in its possession
that it also holds such Collateral for the Second Priority Collateral Agent.
(c) Notwithstanding anything to the contrary contained herein, the
Second Priority Collateral Agent covenants, on behalf of each Second Priority
Secured Party, that it shall not exercise any rights or remedies under this
Agreement until following the Discharge of First Priority Secured Obligations
and agrees that the First Priority Collateral Agent, in its capacity as the
Applicable Collateral Agent, shall not be required to exercise any remedy on
behalf of or at the direction of any Second Priority Secured Party and that the
only rights of the Second Priority Secured Parties is for the Second Priority
Secured Obligations to be secured by a Lien on the Collateral, and to receive
proceeds to the extent provided in Section 12.
(d) All of the First Priority Secured Obligations shall be deemed
to have been made or incurred in reliance upon the provisions of this Section 15
and the Second Priority Col-
-15-
lateral Agent, on behalf of each Second Priority Secured Party, expressly waives
(i) notice of acceptance by any Second Priority Secured Party of this Agreement,
(ii) notice of the existence or creation or non-payment of all or any part of
the First Priority Secured Obligations, (iii) all diligence in collection or
protection of or realization upon all or any part of the First Priority Secured
obligations or any other security therefor and any requirement that the First
Priority Collateral Agent or any other First Priority Secured Party protect,
secure, perfect or insure any Lien or any property subject thereto or exhaust
any right or take any action against any Loan Party.
(e) The Second Priority Collateral Agent, on behalf of each Second
Priority Secured Party, hereby agrees and consents that the First Priority
Secured Parties may, at any time and from time to time, in their sole
discretion, without the consent of or notice to any Second Priority Secured
Party (except to the extent such notice is specifically required pursuant to the
provisions of this Agreement or under any mandatory provision of applicable
law), without incurring responsibility to any Second Priority Secured Party, and
without impairing or releasing the subordination provided for herein or the
obligations of any Second Priority Secured Party to the First Priority Secured
Parties hereunder, amend, restate, supplement or otherwise modify the Credit
Agreement, any Loan Document or any Hedging Agreement in any way whatsoever,
including, without limitation, the following: (i) shorten the final maturity of
all or any part of the First Priority Secured Obligations, (ii) modify the
amortization of the principal amount of all or any part of the First Priority
Secured Obligations, (iii) increase the principal amount of the First Priority
Security Obligations, or otherwise provide for additional advances, (iv) raise
the standard or default per annum interest rates applicable to all or any part
of the First Priority Secured Obligations, (v) impose any additional fees or
penalties upon any Loan Party or increase the amount of or rate for any fees or
penalties provided for in the Credit Agreement, Loan Documents or any Hedging
Agreement, (vi) retain or obtain a Lien on any property to secure any of the
First Priority Secured Obligations, (vii) change the manner, place or terms of
payment or extend the time of payment of, or renew or alter, all or any of the
First Priority Secured Obligations or otherwise amend, restate, supplement or
otherwise modify in any manner, or grant any waiver or release with respect to,
all or any part of the First Priority Secured Obligations or any of the Credit
Agreement, the Loan Documents or any Hedging Agreement, (viii) retain or obtain
the primary or secondary obligation of any other Person with respect to any of
the First Priority Secured Obligations, (x) release any Person liable in any
manner under or in respect of First Priority Secured Obligations or release or
compromise any obligation of any nature of any Person with respect to any of the
First Priority Secured Obligations, (x) sell, exchange, not perfect or otherwise
deal with any property at any time pledged, assigned or mortgaged to secure or
otherwise securing, all or any part of the First Priority Secured Obligations,
(xi) release its security interest in, or surrender, release or permit any
substitution or exchange for, all or any part of any property securing any First
Priority Secured Obligations, or release, compromise, alter or exchange any
obligations of any nature of any Person with respect to any such property, (xii)
amend, or grant any waiver or release with respect to, or consent to any
departure from, any guarantee for all or any of the First Priority Secured
Obligations, (xiii) apply any sums from time to time received to the First
Priority Secured Obligations in such manner such as such Person shall determine
and (xvi) otherwise manage and supervise the First Priority Secured Obligations
in accordance with such Person's usual practices, modified from time to time as
such Person deems appropriate under the circumstances.
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(f) In the event of any Proceeding involving Pledgor:
(i) Except as otherwise specifically permitted in this Section
15(d), until the First Priority Secured Obligations have been paid in full
in cash, neither the Second Priority Collateral Agent nor any other Second
Lien Secured Party shall assert, without the written consent of the First
Priority Collateral Agent, any claim, motion, objection or argument in
respect of the Collateral in connection with such Proceeding which could
otherwise be asserted or raised in connection with such Proceeding by the
Second Priority Secured Parties as secured creditors of Pledgor. Without
limiting the generality of the foregoing, the Second Priority Collateral
Agent, on behalf of each Second Priority Secured Party, agrees that the
Second Priority Secured Party will (i) not object to or oppose a sale or
other disposition of any Collateral free and clear of Liens or other
claims of the Second Priority Secured Parties under Section 363 of the
Bankruptcy Code or any other provision of the Bankruptcy Code or any other
law applicable to such Proceeding if the Second Priority Collateral Agent
has consented to such sale or disposition and the respective interests of
the Second Priority Secured Parties attach to the proceeds thereof,
subject in any event to the provisions hereof, (ii) turn over to the First
Priority Collateral Agent for the pro rata benefit of the First Priority
Secured Parties any "adequate protection" of their interest in any
Collateral that they receive in any Proceeding to the extent necessary to
pay the First Priority Secured Obligations owed to the First Priority
Secured Parties and (iii) not seek to have the automatic stay lifted with
respect to any Collateral, to appoint a Chapter 11 trustee under Section
1104 of the Bankruptcy Code or to convert or dismiss such Proceeding under
Section 1112 of the Bankruptcy Code, in each case without the prior
written consent of the First Priority Collateral Agent; provided that if
the First Priority Collateral Agent seeks such aforementioned relief, the
Second Priority Secured Parties shall join in any such motion or
application seeking such relief.
(ii) The First Priority Collateral Agent, on behalf of the First
Priority Secured Parties, and the Second Priority Collateral Agent, on
behalf of the Second Priority Secured Parties, each agrees not to,
directly or indirectly, take any action or vote in any way that would be
in violation of, or inconsistent with, or result in a breach of, this
Agreement or challenge or contest (A) the validity, perfection, priority
or enforceability of any Lien held by (x) the First Priority Collateral
Agent to secure the payment, performance or observance of all or any part
of the First Priority Secured Obligations or (y) the Second Priority
Collateral Agent to secure the payment, performance or observance of all
or part of the Second Priority Secured Obligations, (ii) the rights of the
Applicable Collateral Agent under this Agreement with respect to any such
Lien, or (iii) the validity or enforceability of this Agreement, the
Credit Agreement, any other Loan Document, the Indenture or any Note;
provided that nothing in this Section 15 is intended or shall be deemed or
construed to limit in any way the ability of the parties hereto to enforce
all of the terms and provisions of this Agreement.
(iii) Subject to the limitations set forth in this Agreement, the
First Priority Collateral Agent and the Second Priority Collateral Agent
may file proofs of claim and other pleadings and motions with respect to
any First Priority Secured Obligations, Sec-
-17-
ond Priority Secured Obligations or the Collateral in any Proceeding. If a
proper proof of claim has not been filed by the Second Priority Collateral
Agent in the form required in such Proceeding at least ten (10) days prior
to the expiration of the time for filing thereof, the Applicable
Collateral Agent shall have the right (but not the duty) to file an
appropriate claim for and on behalf of the Second Priority Secured Parties
with respect to any of the Second Priority Secured Obligations or any of
the Collateral. In furtherance of the foregoing, the Second Priority
Collateral Agent, on behalf of the Second Priority Secured Parties, hereby
appoints the First Priority Collateral Agent, for so long as it is the
Applicable Collateral Agent, as its attorney-in-fact, with full authority
in the place and stead of the Second Priority Collateral Agent and full
power of substitution and in the name of the Second Priority Collateral
Agent or otherwise, to execute and deliver any document or instrument that
the Second Priority Collateral Agent is required or permitted to deliver
pursuant to this clause (e), such appointment being coupled with an
interest and irrevocable.
(iv) The Second Priority Collateral Agent shall execute and deliver
to the Applicable Collateral Agent all such instruments and other
documentation confirming the above authorizations and all such proofs of
claim, assignments of claim and other instruments and documentation, and
shall take all such other action as may be reasonably requested by the
Applicable Collateral Agent to enforce such claims and carry out the
intent of this Section 15.
(v) To the extent that any First Priority Secured Party receives
payments (whether in cash, property or securities) on the First Priority
Secured Obligations or proceeds of the Collateral which are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then,
to the extent of such payment or proceeds received, the First Priority
Secured Obligations, or part thereof, intended to be satisfied shall be
revived and continue in full force and effect as if such payments or
proceeds had not been received by such First Lien Secured Party.
(vi) Notwithstanding any other provision of this Section 15, (i)
the Second Priority Secured Parties shall be entitled to file any
necessary responsive or defensive pleadings in opposition to any motion,
claim, adversary proceeding or other pleading made by any person objecting
to or otherwise seeking the disallowance of the claims of the Second
Priority Secured Parties, including any claims secured by the Collateral,
if any, and (ii) the Second Priority Secured Parties shall be entitled to
file any proof of claim and other filings and make any arguments and
motions that are, in each case, in accordance with the terms of this
Agreement and necessary to preserve their rights, in accordance with the
terms of this Agreement, with respect to the Second Priority Secured
Obligations and the Collateral; provided that notice of intent to take any
such action shall be given by the Second Priority Secured Parties to the
First Priority Collateral Agent not less than the earlier of (x) ten
business days prior to the taking of such action and (y) five business
-18-
days less than the number of days available by order of any applicable
bankruptcy court in which to file a claim.
(g) In the event that any proceeds of Collateral are received by
any Second Priority Secured Party for application to the Second Priority Secured
Obligations in contravention of Section 12, any such proceeds shall be received
and held in trust for the First Priority Secured Parties and shall be paid over
or delivered in the same form as received, with any necessary endorsements or as
a court of competent jurisdiction may otherwise direct, to the First Priority
Collateral Agent for the benefit of the First Priority Secured Parties to the
extent necessary to pay in full in cash all First Priority Secured Obligations
in accordance with their terms. In the event the Second Priority Secured Parties
fail to provide any endorsement, as contemplated by the immediately preceding
sentence, the First Priority Collateral Agent, or any of its officers or
employees, is hereby irrevocably authorized to make the same (which
authorization, being coupled with an interest, is irrevocable). Upon
indefeasible payment in full in cash of all First Priority Secured Obligations
and Discharge of the First Priority Secured Obligations, any remaining proceeds
of Collateral shall be delivered to the Second Priority Collateral Agent for
application to the Second Priority Secured Obligations in accordance with
Section 12, except as otherwise required pursuant to applicable law.
(h) The First Priority Collateral Agent (subject to the proviso
below) shall have the right in accordance with applicable laws and this
Agreement to enforce the provisions of this Agreement (i) by judicial
proceedings for the enforcement of the Liens on the Collateral, (ii) by the sale
of the Collateral or any part thereof, (iii) otherwise by the exercise of the
power of entry or sale or other right granted under this Agreement or (iv) by
taking any other enforcement action against, or exercising any other remedies
with respect to, the Collateral; provided that the Second Priority Secured
Parties shall not have any of the rights or powers specified above in this
clause (e) until the Discharge of First Priority Secured Obligations has
occurred, whereupon the Required Second Lien Lenders shall have the exclusive
right to act on behalf of the Second Lien Secured Parties to exercise the rights
or powers specified in this Section 15(h). Except as the same relates to the
Collateral or as otherwise expressly prohibited by this Agreement, the Lenders
may exercise any right or power, enforce any remedy, give any direction, consent
or waiver or make any determination, under or in respect of any provision of any
Loan Documents to which it is a party.
(i) The provisions of this Section 15 are and are intended solely
for the purpose of defining the relative rights of the First Priority Secured
Parties on the one hand and the Second Priority Secured Parties on the other
hand. Pledgor shall not have any rights under this Section 15. Nothing contained
in this Section 15 or elsewhere in this Agreement is intended to or shall impair
the obligations of the Pledgor hereunder, which are absolute and unconditional.
(j) The Second Priority Collateral Agent, on behalf of the Second
Priority Secured Parties, hereby acknowledges and agrees that (i) the Second
Priority Secured Parties' claims against Pledgor in respect of the Collateral
constitute junior claims separate and apart (and of a different class) from the
senior claims of the First Lien Secured Parties against Pledgor in respect of
the Collateral and (ii) the First Priority Secured Obligations include all
interest that
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accrues after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency, receivership, reorganization or similar
proceeding of any Loan Party at the rate provided for in the Credit Agreement or
the applicable Hedging Agreement, as the case may be, whether or not a claim for
post-petition interest is allowed in any such case, proceeding or other action
and (iii) notwithstanding the date, manner or order of grant, attachment or
perfection of the Liens on all or any part of the Collateral granted to secure
the First Priority Secured Obligations and the Second Priority Secured
Obligations, and notwithstanding the provisions of the UCC or any other
applicable law or decision, or any other circumstance whatsoever, the First
Priority Secured Obligations shall be secured by a first, prior, senior and
continuing Lien on all of the Collateral and any Lien on all or any part of the
Collateral now or hereafter securing the Second Priority Secured Obligations,
regardless of when or how acquired, whether by grant, statute, operation of law,
subrogation or otherwise, shall be in all respects and for all purposes subject
to, junior to and subordinate to all Liens on all or any part of the Collateral
granted to secure the First Priority Secured Obligations.. To further effectuate
the intent of the parties as provided in the immediately preceding sentence, if
it is held that the claims against the Pledgor in respect of the Collateral
constitute only one secured claim (rather than separate classes of senior and
junior claims), then the Second Priority Collateral Agent, on behalf of the
Second Priority Secured Parties, hereby acknowledges and agrees that all
distributions pursuant to Section 12 or otherwise shall be made as if there were
separate classes of senior and junior secured claims against Pledgor in respect
of the Collateral (with the effect being that, to the extent that the aggregate
value of the Collateral is sufficient (for this purpose ignoring all claims held
by the Second Priority Collateral Agent on behalf of the Second Priority Secured
Parties), the First Priority Secured Parties shall be entitled to receive, in
addition to amounts distributed to them in respect of principal, pre-petition
interest and other claims, all amounts owing in respect of post-petition
interest at the relevant contract rate (even though such claims may or may not
be allowed in whole or in part in the respective bankruptcy, insolvency,
reorganization, receivership or similar proceeding) before any distribution is
made in respect of the claims held by the Second Priority Collateral Agent, on
behalf of the Second Priority Secured Parties, with the Second Priority
Collateral Agent, on behalf of each of the Second Priority Secured Parties,
hereby acknowledging and agreeing to turn over to the holders of the First
Priority Secured Obligations all amounts otherwise received or receivable by the
Second Priority Secured Parties to the extent needed to effectuate the intent of
this sentence even if such turnover of amounts has the effect of reducing the
amount of the claim of the Second Priority Secured Parties).
SECTION 16. Waivers; Amendment. (a) No failure or delay of the
Applicable Collateral Agent in exercising any power or right hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce
such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of the Applicable
Collateral Agent hereunder are not exclusive of any rights or remedies that they
would otherwise have. No waiver of any provisions of this Agreement or any other
Loan Document or consent to any departure by Pledgor therefrom shall in any
event be effective unless the same shall be permitted by paragraph (b) below,
and then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given. No notice to or demand on Pledgor in any
case shall entitle Pledgor to any other or further notice or demand in similar
or other circumstances.
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(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to a written agreement entered into among
the First Priority Collateral Agent, the Second Priority Collateral Agent and
the Pledgor with respect to which such waiver, amendment or modification is to
apply. The First Priority Collateral Agent is authorized without the consent of
any other First Priority Secured Party to enter into an amendment or supplement
to this Agreement with respect to the First Priority Secured Obligations as
contemplated by Section 5.12(b) of the Credit Agreement. The Second Priority
Collateral Agent is authorized to enter into an amendment or supplement to this
Agreement with respect to the Second Priority Secured Obligations (x) without
the consent of any other Second Priority Secured Party as contemplated by
Section 9.01 of the Indenture and (y) with the consent of the Second Priority
Secured Parties as contemplated by Section 9.02 of the Indenture. Sections 9.01
and 9.02 of the Indenture and the defined terms set forth in Article I thereof
are specifically incorporated herein by reference with the same force and effect
as if the same were set forth in this Agreement in full.
SECTION 17. Securities Act, etc. In view of the position of the
Pledgor in relation to the Pledged Securities, or because of other current or
future circumstances, a question may arise under the Securities Act of 1933, as
now or hereafter in effect, or any similar statute hereafter enacted analogous
in purpose or effect (such Act and any such similar statute as from time to time
in effect being called the "Federal Securities Laws") with respect to any
disposition of the Pledged Securities permitted hereunder. Pledgor understands
that compliance with the Federal Securities Laws might very strictly limit the
course of conduct of the Applicable Collateral Agent if the Applicable
Collateral Agent were to attempt to dispose of all or any part of the Pledged
Securities, and might also limit the extent to which or the manner in which any
subsequent transferee of any Pledged Securities could dispose of the same.
Similarly, there may be other legal restrictions or limitations affecting the
Applicable Collateral Agent in any attempt to dispose of all or part of the
Pledged Securities under applicable Blue Sky or other state securities laws or
similar laws analogous in purpose or effect. Pledgor recognizes that in light of
such restrictions and limitations the Applicable Collateral Agent may, with
respect to any sale of the Pledged Securities, limit the purchasers to those who
will represent and agree, among other things, to acquire such Pledged Securities
for their own account for investment, and not with a view to the distribution or
resale thereof, and upon consummation of any such sale the Applicable Collateral
Agent shall have the right to assign, transfer and deliver to the purchaser or
purchasers thereof the Collateral so sold. Pledgor acknowledges and agrees that
in light of such restrictions and limitations, the Applicable Collateral Agent,
in its sole and absolute discretion (but subject to the other provisions of this
Agreement), (a) may proceed to make such a sale whether or not a registration
statement for the purpose of registering such Pledged Securities or part thereof
shall have been filed under the Federal Securities Laws and (b) may approach and
negotiate with a single potential purchaser to effect such sale, in each case,
in accordance with mandatory provisions of applicable law. Pledgor acknowledges
and agrees that any such sale might result in prices and other terms less
favorable to the seller than if such sale were a public sale without such
restrictions. In the event of any such sale, the Applicable Collateral Agent
shall incur no responsibility or liability for selling all or any part of the
Pledged Securities at a price that the Applicable Collateral Agent, in its sole
and absolute discretion, may in good ▇▇▇▇▇ ▇▇▇▇ reasonable under the
circumstances, notwithstanding the possibility that a substantially higher
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price might have been realized if the sale were deferred until after
registration as aforesaid or if more than a single purchaser were approached.
The provisions of this Section 17 will apply notwithstanding the existence of a
public or private market upon which the quotations or sales prices may exceed
substantially the price at which the Applicable Collateral Agent sells.
SECTION 18. Registration, etc. Pledgor agrees that, upon the
occurrence and during the continuance of an Event of Default hereunder, if for
any reason the Applicable Collateral Agent desires to sell any of the Pledged
Securities at a public sale, it will, at any time and from time to time, upon
the written request of the Applicable Collateral Agent, use its reasonable best
efforts to take or to cause the issuer of such Pledged Securities to take such
action and prepare, distribute, file and/or cause to become effective such
documents as are required or advisable in the reasonable opinion of counsel for
the Applicable Collateral Agent to permit the public sale of such Pledged
Securities in accordance with applicable law. Pledgor further agrees to or to
cause each such issuer to indemnify, defend and hold harmless the Applicable
Collateral Agent, each other Secured Party, any underwriter and their respective
officers, directors, affiliates and controlling Persons (collectively,
"indemnitees") from and against all loss, liability, expenses, costs of counsel
(including, without limitation, reasonable fees and expenses to the Applicable
Collateral Agent of legal counsel) and claims (including the costs of
investigation) that they may incur insofar as such loss, liability, expense or
claim arises out of or is based upon any alleged untrue statement of a material
fact contained in any prospectus (or any amendment or supplement thereto) or in
any notification or offering circular, or arises out of or is based upon any
alleged omission to state a material fact required to be stated therein or
necessary to make the statements in any thereof not misleading, except insofar
as the same may have been caused by any untrue statement or omission based upon
information furnished in writing to Pledgor or the issuer of such Pledged
Securities by the Applicable Collateral Agent or any other Secured Party
expressly for use therein. Pledgor further agrees, upon such written request
referred to above, to use its reasonable best efforts to qualify, file or
register, or cause the issuer of such Pledged Securities to qualify, file or
register, any of the Pledged Securities under the Blue Sky or other securities
laws of such states as may be requested by the Applicable Collateral Agent and
keep effective, or cause to be kept effective, all such qualifications, filings
or registrations. Pledgor will or will cause the applicable issuer to bear all
costs and expenses of carrying out its obligations under this Section 18.
Pledgor acknowledges that there is no adequate remedy at law for failure by it
to comply with the provisions of this Section 18 and that such failure would not
be adequately compensable in damages, and therefore agrees that its agreements
contained in this Section 18 may be specifically enforced.
SECTION 19. Termination or Release. (a) This Agreement (including,
without limitation, Section 14 hereof) and the security interests granted hereby
(i) shall terminate when all the Secured Obligations have been indefeasibly paid
in full, the Lenders have no further commitment to lend under the Credit
Agreement or to issue or participate in Letters of Credit and the LC Exposure
has been reduced to zero (at which time each Collateral Agent shall, if
requested by Pledgor, execute and deliver to Pledgor, at Pledgor's expense, all
UCC termination statements and other documents which such Pledgor shall
reasonably request to evidence such termination) and (ii) shall continue to be
effective or shall be reinstated, as the case may be, if at any time any payment
in respect of any Secured Obligation is rescinded or must otherwise be
-22-
restored by Secured Party upon any bankruptcy or reorganization of Pledgor or
otherwise. Notwithstanding the foregoing, the Guarantee pursuant to Section 3
hereunder shall be subject to termination and discharge under the circumstances
described in Section 14.03(b) of the Indenture. Section 14.03(b) of the
Indenture and the defined terms set forth in Article I thereof are specifically
incorporated herein by reference with the same force and effect as if the same
were set forth in this Agreement in full. Any execution and delivery of
termination statements or documents pursuant to this Section 19(a) shall be
without recourse to or warranty by the Applicable Collateral Agent.
(b) In connection with any termination or release pursuant to
paragraph (a) or (b), the Applicable Collateral Agent shall execute and deliver
to Pledgor, at Pledgor's expense, all documents that such Pledgor shall
reasonably request to evidence such termination or release. Any execution and
delivery of documents pursuant to this Section 19 shall be without recourse to
or warranty by the Applicable Collateral Agent.
SECTION 20. Notices. All communications and notices hereunder shall
be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopy, as follows:
(a) if to the Pledgor, to it at :
c/o Homebase Acquisition, LLC
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
Providence Equity
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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Attention: ▇▇▇▇ ▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
Spectrum Equity
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
King & Spalding LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇, Esq.
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇, Esq.
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
(b) If to the First Priority Collateral Agent, to it at:
Citicorp North America, Inc.
▇ ▇▇▇▇'▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇.▇.▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
(c) If to the Second Priority Collateral Agent, to it at:
-▇▇-
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, N.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇'▇▇▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇.▇'▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
SECTION 21. Further Assurances. Pledgor agrees to do such further
acts and things, and to execute and deliver such additional conveyances,
assignments, agreements and instruments, as the Applicable Collateral Agent may
at any time reasonably request in connection with the administration and
enforcement of this Agreement or with respect to the Collateral or any part
thereof or in order better to assure and confirm unto the Applicable Collateral
Agent its rights and remedies hereunder.
SECTION 22. Survival of Agreement; Severability. (a) All covenants,
agreements, representations and warranties made by any Pledgor herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement, any other Loan Document, the Indenture or the Notes
shall be considered to have been relied upon by the Applicable Collateral Agent
and the other Secured Parties and shall survive the making by the Lenders of the
Loans, the Lenders' issuance of and participations in Letters of Credit, and the
issuance and sale of the Notes regardless of any investigation made by the
Secured Parties or on their behalf, and shall continue in full force and effect
until this Agreement shall terminate.
(b) In the event any one or more of the provisions contained in
this Agreement should be held invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby (it being understood
that the invalidity of a particular provision in a particular jurisdiction shall
not in and of itself affect the validity of such provision in any other
jurisdiction). The parties shall endeavor in good-faith negotiations to replace
the invalid, illegal or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions. It is understood and agreed that this
Agreement shall create separate security interests in the Collateral securing
the Secured Obligations, as provided in Sections 4 and 5, and that any
determination by any court with jurisdiction that the security interest securing
any Secured Obligation or class of Secured Obligations is invalid for any reason
shall not in and of itself invalidate the security interest securing any other
Obligations hereunder.
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SECTION 23. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 24. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original, but all of which,
when taken together, shall constitute a single contract. Delivery of an executed
counterpart of a signature page to this Agreement by facsimile transmission
shall be as effective as delivery of a manually executed counterpart of this
Agreement.
SECTION 25. Rules of Interpretation. Section headings used herein
are for convenience of reference only, are not part of this Agreement and are
not to affect the construction of, or to be taken into consideration in
interpreting, this Agreement.
SECTION 26. Jurisdiction; Consent to Service of Process. (a) Each
party hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, the other Loan Documents, the Indenture or the
Notes, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that, to the extent
permitted by applicable law, all claims in respect of any such action or
proceeding may be heard and determined in such New York State court or, to the
extent permitted by applicable law, in such Federal court referred to above.
Each of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by applicable law. Nothing
in this Agreement shall affect any right that the Applicable Collateral Agent or
any other Secured Party may otherwise have to bring any action or proceeding
relating to this Agreement, the other Loan Documents, the Indenture or the Notes
against Pledgor or its properties in the courts of any jurisdiction.
(b) Each party hereto hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement, the other
Loan Documents, the Indenture or the Notes in any New York State or Federal
court referred to in paragraph (a) of this Section. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.
(c) Each party to this Agreement irrevocably consents to service
of process in the manner provided for notices in Section 20. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 27. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN
-26-
CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS. EACH PARTY
HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
SECTION 28. Execution of Financing Statements. Pursuant to Section
9-509 of the UCC, Pledgor authorizes the First Priority Collateral Agent and the
Second Priority Collateral Agent to file financing statements with respect to
the Collateral without the signature of Pledgor in such form and in such filing
offices as the First Priority Collateral Agent and the Second Priority
Collateral Agent reasonably determine appropriate to perfect the security
interests under this Agreement. A carbon, photographic or other reproduction of
this Agreement shall be sufficient as a financing statement for filing in any
jurisdiction.
SECTION 29. Resignation of the Second Priority Collateral Agent. If
the Trustee under the Indenture resigns or is removed at any time pursuant to
Section 7.10 of the Indenture, it shall be deemed to have simultaneously
resigned as the Second Priority Collateral Agent hereunder. Any replacement
trustee appointed pursuant to the Indenture shall be deemed to be the
replacement Second Priority Collateral Agent hereunder.
[SIGNATURE PAGES FOLLOW]
-27-
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
HOMEBASE ACQUISITION, LLC
By: /s/ ▇▇▇▇▇▇ ▇.▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
S-1
CITICORP NORTH AMERICA, INC.,
as First Priority Collateral Agent
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title: Director
Address: ▇ ▇▇▇▇'▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ FARGO BANK, N.A.
as Second Priority Collateral Agent,
By: /s/ ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇
Title: Assistant Vice President
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
S-1
Schedule I to
Pledge and Guarantee Agreement
SUBSIDIARIES
ENTITY ADDRESS
------ -------
Consolidated Communications, Inc. ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Consolidated Communications Acquisition ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, Inc. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Consolidated Communications Texas ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Holdings, Inc. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Consolidated Communications Illinois ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Holdings, Inc. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Consolidated Communications Market ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Response, Inc. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Consolidated Communications Public ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Services, Inc. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Consolidated Communications Operator ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Services, Inc. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Consolidated Communications Mobile ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Services, Inc. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Consolidated Communications Business ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Systems, Inc. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Consolidated Communications Network ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Services, Inc. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Illinois Consolidated Telephone Company ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
TXU Communications Ventures Company ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
TXU Communications Services Company ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
TXU Communications Transport Company ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
TXU Communications Telecom Services ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Company ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Fort Bend Telephone Company ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
TXU Communications Telephone Company ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Fort Bend Wireless Company ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
TelCon, Inc. ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
-2-
FBCIP, Inc. ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Fort Bend Cellular, Inc. ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
East Texas Fiber Line Incorporated ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
-3-
Schedule II to the
Pledge and Guarantee Agreement
PLEDGED STOCK
NUMBER NUMBER AND PERCENTAGE
OF REGISTERED CLASS OF SHARES/ OF
ISSUER CERTIFICATE OWNER TYPE OF INTEREST SHARES/INTERESTS
------------------ ----------- -------------- ---------------- ----------------
Consolidated C-1 Homebase 1,000 shares 100%
Communications Acquistion LLC common stock,
Texas Holdings, par value $0.01
Inc. per share
Consolidated 3 Homebase 1,000 shares 100%
Communications Acquistion LLC common stock,
Illinois Holdings, par value $0.01
Inc. per share