EXHIBIT 10.2
AMENDED AND RESTATED PLEDGE AND SECURITY AGREEMENT
dated as of June 3, 2002
among
THE PLEDGORS NAMED HEREIN
and
BANK ONE, NA
as Agent
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS.......................................................1
1.1 Terms Defined in the Credit Agreement................................1
1.2 Definition of Certain Terms Used Herein..............................1
1.3 UCC Definitions......................................................3
1.4 Terms Generally.....................................................3
SECTION 2 SECURITY INTERESTS.................................................3
2.1 Security Interests...................................................3
2.2 Continuing Liability of each Pledgor.................................4
2.3 Delivery of Pledged Securities.......................................4
2.4 Security Interests Absolute..........................................5
2.5 Release of Collateral................................................6
SECTION 3 REPRESENTATIONS AND WARRANTIES.....................................6
3.1 Credit Agreement.....................................................6
3.2 Pledged Securities...................................................6
3.3 Validity, Perfection, Assignment and Priority of Security Interests..7
3.4 Enforceability of General Intangibles................................7
3.5 Place of Business, Location of Collateral............................7
3.6 Trade Names..........................................................8
3.7 Outstanding Interests................................................8
3.8 Effectiveness.......................................................8
SECTION 4. COVENANTS.........................................................8
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4.1 Perfection of Security Interests....................................8
4.2 Further Actions......................................................8
4.3 Change of Name, Identity or Structure...............................10
4.4 Place of Business and Collateral....................................10
4.5 Maintenance of Records..............................................10
4.6 Compliance with Law.................................................10
4.7 Payment of Taxes....................................................11
4.8 Limitation on Liens on Collateral...................................11
4.9 Maintenance of Insurance............................................11
4.10 Limitations on Dispositions of Collateral.........................11
4.11 Periodic Certification............................................12
4.12 Notices...........................................................12
4.13 Change of Law.....................................................12
4.14 Right of Inspection...............................................12
4.15 Reimbursement Obligation..........................................13
4.16 Amendments to Schedules...........................................13
SECTION 5. DISTRIBUTIONS ON PLEDGED SECURITIES; VOTING......................13
5.1 Right to Receive Distributions on Pledged Collateral; Voting........13
SECTION 6. REMEDIES; RIGHTS UPON DEFAULT....................................14
6.1 UCC Rights........................................................14
6.2 Possession of Collateral............................................15
6.3 Sale of Collateral..................................................15
6.4 Rights of Purchasers................................................16
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6.5 Additional Rights of the Agent......................................16
6.6 Securities Act, etc.................................................16
6.7 Remedies Not Exclusive..............................................18
6.8 Waiver and Estoppel.................................................19
6.9 Power of Attorney...................................................19
6.10 Application of Proceeds...........................................21
SECTION 7. MISCELLANEOUS....................................................22
7.1 Notices.............................................................22
7.2 Survival of Agreement...............................................22
7.3 Counterparts........................................................23
7.4 Amendments. Etc.....................................................23
7.5 Assignments........................................................23
7.6 Severability........................................................23
7.7 Joinder Agreement...................................................24
7.8 GOVERNING LAW; Submission to Jurisdiction; Venue....................24
7.9 Entirety............................................................25
7.10 No Waiver; Remedies...............................................25
7.11 Headings..........................................................25
Schedules
Schedule 1 List of Subsidiary Pledgors
Schedule 2 Chief Executive Office and Principal Place of Business
Schedule 3 Pledged Securities
Schedule 4 Trade Names, Division Names, etc.
Schedule 5 Required Filings and Recordings
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AMENDED AND RESTATED PLEDGE AND SECURITY AGREEMENT (as amended,
modified, restated or supplemented from time to time, this "Pledge Agreement")
dated as of June 3, 2002, among ▇▇▇▇▇▇ INTERNATIONAL INC., an Ohio corporation
(the "Borrower"), the Domestic Subsidiaries that are listed on Schedule 1
hereto, and such other Domestic Subsidiaries as shall become parties hereto in
accordance with Section 7.7 hereof (such Subsidiaries being referred to herein
individually as a "Subsidiary Pledgor" and collectively as the "Subsidiary
Pledgors"), and BANK ONE, NA, as Agent (as defined herein) for the Lenders (as
defined herein). This Pledge Agreement amends and restates in its entirety the
Pledge and Security Agreement dated as of October 13, 2000 among Borrower, the
Subsidiary Pledgors named therein and Agent.
Reference is made to (i) the Amended and Restated Credit Agreement
dated as of the date hereof (as amended, modified, restated or supplemented from
time to time, the "Credit Agreement"), among the Borrower, the several lenders
from time to time party thereto (the "Lenders") and Bank One, NA, as Agent (the
"Agent"). The Lenders and Bank One have agreed to extend credit to the Borrower,
pursuant to, and upon the terms and subject to the conditions set forth in, the
Credit Agreement. The obligations of the Lenders and Bank One to extend credit
under the Credit Agreement are conditioned on, among other things, the execution
and delivery by each of the Borrower and the Subsidiary Pledgors (such parties
being referred to herein individually as a "Pledgor" and collectively as the
"Pledgors") of a Pledge and Security Agreement in the form hereof.
Accordingly, the Pledgors, intending to be legally bound, hereby agree
with the Agent, for the ratable benefit of the Secured Parties, as follows:
SECTION 1. DEFINITIONS
1.1 Terms Defined in the Credit Agreement. Terms used herein and not
otherwise defined herein shall have the meanings set forth in the Credit
Agreement.
1.2 Definition of Certain Terms Used Herein. As used herein, the following
terms shall have the following meanings:
"Account Debtor" shall mean any person who is or who may become obligated
to any Pledgor under, with respect to or on account of any General Intangible.
"Collateral" shall have the meaning assigned to that term in Section 2.1.
"Contract Rights" shall mean all choses in action and causes of action and
all other rights of any Pledgor of every kind and nature now owned or hereafter
acquired by any Pledgor pursuant to (a) all contracts under which General
Intangibles arise and (b) all other contract rights of any Pledgor.
"General Intangibles" of any Pledgor shall mean (a) all Capital Stock of
any Subsidiary now owned or hereafter acquired by such Pledgor; provided, that,
no shares of Capital Stock of any issuer organized in a jurisdiction outside of
the United States of America shall be included hereunder to the extent that the
aggregate amount of shares of Capital Stock of such issuer pledged hereunder
would exceed 65% of such issuer's issued and outstanding Capital Stock for so
long as the pledge of any greater percentage would have adverse tax consequences
for the Borrower; (b) all general or limited partnership interests now owned or
hereafter acquired by such Pledgor; and (c) all dividends, liquidating
dividends, distributions, options, rights to subscribe, cash, instruments and
other property and proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such Capital Stock
referenced in clause (a) above (and all contract rights to receive any of the
foregoing) and (c) all rights of such Pledgor (including all choses in action
and causes of action) under all agreements that in any way relate to the Capital
Stock.
"Pledged Debt" shall mean (a) the debt securities listed and described in
Part II of Schedule 3 hereto, payable to such Pledgor listed therein, and the
instruments evidencing such debt securities, (b) all additional debt securities
hereafter issued and payable to any Pledgor and the instruments evidencing such
debt securities, (c) the Intercompany Notes and (d) all payments of principal or
interest, cash, instruments or other property from time to time received,
receivable or otherwise distributed, in respect of, in exchange for or upon the
conversion of the debt securities referred to in clause (a), (b) and (c) above.
"Pledged Interests" shall mean (a) the Capital Stock listed and described
in Part I of Schedule 3 hereto, and the certificates, if any, representing such
Capital Stock; (b) the partnership interests listed and described in Schedule 3
hereto; (c)(i) all additional Capital Stock of any issuer of the Pledged
Interests from time to time acquired by any Pledgor in any manner and (ii) all
Capital Stock of any other person hereafter acquired by any Pledgor (which
Capital Stock referred to in the foregoing clauses (i) and (ii) shall be
considered to be Pledged Interests under this Pledge Agreement), together in
each case with the certificates representing such additional Capital Stock, and
(d) all dividends, liquidating dividends, stock dividends, distributions, stock
or partnership rights, options, warrants, rights to subscribe, cash, instruments
and other property and proceeds from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of such listed
Capital Stock referenced in clause (a) above or such additional Capital Stock
referenced in clause (b) above; provided, that, no shares of Capital Stock of
any issuer incorporated in a jurisdiction outside of the United States of
America shall be included hereunder to the extent that the aggregate amount of
shares of Capital Stock of such issuer pledged hereunder would exceed 65% of the
Capital Stock of such issuer to the extent, and for so long as, the pledge of
any greater percentage would have adverse tax consequences for the Borrower or
such Pledgor.
"Pledged Securities" shall mean the Pledged Interests and the Pledged Debt.
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"Proceeds" shall mean all proceeds, including (a) whatever is received upon
any collection, exchange, sale or other disposition of any of the Collateral and
any property into which any of the Collateral is converted, whether cash or
non-cash, (b) any and all payments or other property (in whatever form) made or
due and payable on account of any insurance, indemnity, warranty or guaranty
payable to any Pledgor with respect to any of the Collateral, (c) any value
received as a consequence of the possession of any Collateral and any payment
received from any insurer or other person as a result of the destruction, loss,
theft or other involuntary conversion of whatever nature of any asset or
property which constitutes Collateral, (d) any and all payments (in any form
whatsoever) made or due and payable in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the
Collateral by any Governmental Authority and (e) any and all other amounts from
time to time paid or payable under or in connection with any of the Collateral.
"Secured Obligations" of any Pledgor shall mean (a) in the case of the
Borrower, all the Credit Obligations and (b) in the case of any Subsidiary
Pledgor, all amounts now or hereafter payable by such Subsidiary Pledgor under
the Guarantee Agreement, and (c) in the case of any Pledgor, all expenses
(including reasonable counsel fees and expenses but excluding the costs of
internal counsel) incurred in enforcing any rights of the Agent and the Secured
Parties against such Pledgor under this Pledge Agreement.
"UCC" shall mean at any time the Uniform Commercial Code as the same may
from time to time be in effect in the State of Ohio; provided, that if, by
reason of mandatory provisions of law, the validity or perfection of any
security interest granted herein is governed by the Uniform Commercial Code as
in effect in a jurisdiction other than Ohio then, as to the validity or
perfection of such security interest, "UCC" shall mean the Uniform Commercial
Code in effect in such other jurisdiction.
1.3 UCC Definitions. The uncapitalized terms "account", "account debtor",
"chattel paper", "document", "instrument", "equipment", "general intangible",
"money", "proceeds", and "products" as used in Section 1.2 or elsewhere in this
Pledge Agreement shall have the meanings ascribed thereto in the UCC.
1.4 Terms Generally. The rules of interpretation specified in Section 1.4
of the Credit Agreement shall be applicable to this Pledge Agreement. All
references herein to Sections, Exhibits and Schedules shall be deemed references
to Sections of, and Exhibits and Schedules to, this Pledge Agreement unless the
context shall otherwise require.
SECTION 2. SECURITY INTERESTS
2.1 Security Interests. (a) To secure the due and punctual payment of all
Secured Obligations of such Pledgor, howsoever created, arising or evidenced,
whether direct or indirect, absolute or contingent, now or hereafter existing or
due or to become
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due, in accordance with the terms thereof (i) each Pledgor hereby grants to the
Agent, its successors and its assigns, for the ratable benefit of the Secured
Parties, a security interest in, and (ii) each Pledgor hereby pledges to the
Agent, its successors and assigns, for the ratable benefit of the Secured
Parties, all of such Pledgor's right, title and interest in, to and under the
following, whether now existing or hereafter acquired (all of which are herein
collectively called the "Collateral"):
A. all Pledged Securities of such Pledgor;
B. all General Intangibles of such Pledgor; and
C. to the extent not otherwise included, all Proceeds and products of
any or all of the foregoing, whether existing on the date hereof or arising
hereafter.
(b) No Pledgor shall be required to pledge hereunder, and nothing herein
shall be deemed to constitute a pledge hereunder of, more than 65% of the total
capital stock of any issuer organized in a jurisdiction outside of the United
States for so long as the pledge of any greater percentage would have adverse
tax consequences for the Borrower or such ▇▇▇▇▇▇▇.
2.2 Continuing Liability of each Pledgor. Anything herein to the contrary
notwithstanding, each Pledgor shall remain liable to observe and perform all the
terms and conditions to be observed and performed by it under any contract,
agreement, warranty or other obligation with respect to the Collateral, and
shall do nothing to impair the security interests herein granted. Neither the
Agent nor any Secured Party shall have any obligation or liability under any
such contract, agreement, warranty or obligation by reason of or arising out of
this Pledge Agreement or the receipt by the Agent or any Secured Party of any
payment relating to any Collateral, nor shall the Agent or any Secured Party be
required to perform or fulfill any of the obligations of any Pledgor with
respect to any of the Collateral, to make any inquiry as to the nature or
sufficiency of any payment received by it or the sufficiency of the performance
of any party's obligations with respect to any Collateral. Furthermore, neither
the Agent nor any Secured Party shall be required to file any claim or demand to
collect any amount due or to enforce the performance of any party's obligations
with respect to the Collateral.
2.3 Delivery of Pledged Securities. All certificates or instruments
representing or evidencing the Pledged Securities shall be delivered to and held
by or on behalf of the Agent, for the ratable benefit of the Secured Parties,
pursuant hereto and shall be in suitable form for transfer by delivery, duly
endorsed and shall be accompanied (excluding the certificates representing the
Capital Stock of ▇▇▇▇▇▇ International Holdings Pty Limited) by duly executed
instruments of transfer or assignment in blank with signatures appropriately
guaranteed, and accompanied in each case by any required transfer tax stamps,
all in form and substance reasonably satisfactory to the Agent. The Agent shall
have the right, at any time after the occurrence and during the
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continuance of an Event of Default, in its discretion and without notice to any
Pledgor, to cause any or all of the Pledged Interests and other Pledged
Securities to be transferred of record into the name of the Agent or its
nominee.
2.4 Security Interests Absolute. All rights of the Agent and the Secured
Parties hereunder, and all obligations of each Pledgor hereunder, shall be
absolute and unconditional and, without limiting the generality of the
foregoing, shall not be released, discharged or otherwise affected by:
(a) any extension, renewal, settlement, compromise, waiver or release
in respect of any Secured Obligation, Note or any other document evidencing
or securing any Secured Obligation, by operation of law or otherwise;
(b) any modification, amendment or supplement to the Credit Agreement,
any Note, any Collateral Document or any other document evidencing or
securing any Secured Obligation;
(c) any release, non-perfection or invalidity of any direct or
indirect security for any Secured Obligation;
(d) any change in the existence, structure or ownership of the
Borrower, any other Pledgor or any other Credit Party, or any Bankruptcy
Event affecting the Borrower, any other Pledgor or any other Credit Party
or its assets or any resulting disallowance, release or discharge of all or
any portion of the Secured Obligations;
(e) the existence of any claim, set-off or other right which any
Pledgor may have at any time against the Borrower, any other Pledgor, any
other Credit Party, the Agent, any Secured Party or any other corporation
or person, whether in connection herewith or any unrelated transactions;
(f) any invalidity or unenforceability for any reason of any Secured
Obligation relating to or against the Borrower, any other Pledgor or any
other Credit Party, or any provision of applicable law or regulation
purporting to prohibit the payment by the Borrower, any other Pledgor or
any other Credit Party of the Secured Obligations;
(g) any failure by the Agent or any Secured Party (i) to file or
enforce a claim against the Borrower, any Pledgor or any other Credit Party
or its estate (in a bankruptcy or other proceeding), (ii) to give notice of
the existence, creation or incurrence by the Borrower, any other Pledgor or
any other Credit Party of any new or additional indebtedness or obligation
under or with respect to the Secured Obligations, (iii) to commence any
action against the Borrower, any other Pledgor or any other Credit Party,
(iv) to disclose to the Borrower, any other Pledgor or any other Credit
Party any facts which the Agent or any Secured Party may now
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or hereafter know with regard to the Borrower, any other Pledgor or any
other Credit Party or (v) to proceed with due diligence in the collection,
protection or realization upon any collateral securing the Secured
Obligations; or
(h) any other act or omission to act or delay of any kind by the
Borrower, any other Pledgor, any other Credit Party, the Agent, any Secured
Party or any other person or any other circumstance whatsoever which might,
but for the provisions of this clause, constitute a legal or equitable
discharge of any Pledgor's obligations hereunder.
2.5 Release of Collateral. Upon (a) the indefeasible payment in full
in cash of all of the Secured Obligations, (b) the termination of the
Commitments, and (c) the satisfaction by the Borrower of all terms and
conditions hereof, the Credit Agreement, the Notes, the Collateral
Documents and all other documents or agreements governing the Secured
Obligations, the Agent will (as soon as reasonably practicable after
receipt of notice from any Pledgor requesting the same, but at the expense
of such Pledgor) (i) execute and deliver to such Pledgor for each filing
made under Section 4.1 or 4.2 to perfect the security interests granted to
the Agent and the Secured Parties hereunder, a termination statement
prepared by such Pledgor and furnished to the Agent to the effect that the
Agent and the other Secured Parties no longer claim a security interest
under such filing and (ii) deliver to such Pledgor all documents and
instruments previously pledged to the Agent hereunder.
SECTION 3. REPRESENTATIONS AND WARRANTIES
The Pledgors jointly and severally represent and warrant to the Agent
and each of the Secured Parties that:
3.1 Credit Agreement. All representations and warranties contained in
the Credit Agreement that relate to such Pledgor are true and correct. Such
Pledgor agrees to comply with each of the covenants contained in the Credit
Agreement that imposes or purports to impose restrictions or obligations on
such Pledgor. Each Pledgor acknowledges that any default in the due
observance or performance by such Pledgor of any covenant, condition or
agreement contained herein may (after giving effect to any applicable grace
or cure period) constitute an "Event of Default" under Section 8 of the
Credit Agreement. There are no conditions precedent to the effectiveness of
this Pledge Agreement that have not been satisfied or waived.
3.2 Pledged Securities. All Pledged Securities have been duly
authorized and validly issued by the issuers thereof and, in the case of
Pledged Securities consisting of Capital Stock, are fully paid and
nonassessable. None of the Pledged Securities are subject to options to
purchase or similar rights of any person. No Pledgor is or will become a
party to or otherwise bound by any agreement, other than this Pledge
Agreement, which restricts in any manner the rights of any present or
future holder of any of the Pledged Interests with respect thereto.
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3.3 Validity, Perfection, Assignment and Priority of Security Interests.
(a) By complying with Section 4.1 and by delivering all certificates or
instruments, if any, representing or evidencing the Collateral to the Agent,
each Pledgor will have created a valid and duly perfected security interest in
favor of the Agent for the benefit of the Secured Parties as security for the
due and punctual payment of all Secured Obligations of such Pledgor in all
Collateral and identifiable Proceeds of such Collateral, as to which a security
interest may be perfected by (i) filing UCC financing statements and (ii)
possession. Continuing compliance by each Pledgor with the provisions of Section
4.2 will also (A) create and duly perfect valid security interests in all
Collateral acquired or otherwise coming into existence after the date hereof and
in all identifiable Proceeds of such Collateral as security for the due and
punctual payment of all Secured Obligations of such Pledgor and (B) cause such
security interests in all Collateral and in all Proceeds which are (I)
identifiable cash Proceeds of Collateral covered by financing statements
required to be filed hereunder and (II) identifiable Proceeds in which a
security interest may be perfected by such filing under the UCC.
(b) The security interests of the Agent in the Collateral rank first in
priority, except that the priority of the security interests may be subject to
Liens permitted under Section 7.2 of the Credit Agreement. Other than financing
statements or other similar documents perfecting the security interests or deed
of trust liens of the Agent and the protective filings filed by the lessors of
certain equipment leased by the Pledgors, no financing statements, deeds of
trust, mortgages or similar documents covering all or any part of the Collateral
other than with respect to Liens permitted under Section 7.2 of the Credit
Agreement are on file or of record in any government office in any jurisdiction
in which such filing or recording would be effective to perfect a security
interest in such Collateral, nor is any of the Collateral in the possession of
any person (other than a Pledgor) asserting any claim thereto or security
interest therein.
3.4 Enforceability of General Intangibles. To the knowledge of each
Pledgor, each General Intangible is a valid and binding obligation of the
related Account Debtor in respect thereof, enforceable in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general provisions of equity (regardless
of whether such enforceability is considered in a proceeding in equity or at
law), and complies in all material respects with applicable legal requirements.
3.5 Place of Business, Location of Collateral. Schedule 2 correctly sets
forth (a) each Pledgor's chief executive offices and principal place of business
and (b) the offices of each Pledgor where records concerning General Intangibles
are kept. No amount payable under or in connection with any of the Collateral is
evidenced by promissory notes or other instruments other than instruments
evidencing the Pledged Debt which have been delivered to the Agent hereunder.
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3.6 Trade Names. Any and all trade names, division names, assumed names or
other names under which any Pledgor transacts, or at any time during the past
five years prior to the date hereof has transacted, business are specified on
Schedule 4.
3.7 Outstanding Interests. The Capital Stock listed on Schedule 3
constitutes (i) 100% of the Capital Stock of all Domestic Subsidiaries and (ii)
65% of the Capital Stock of all Foreign Subsidiaries directly owned by any
Pledgor.
3.8 Effectiveness. The pledge and grant effected hereby is effective to
vest in the Agent, on behalf of the Secured Parties, the rights of the Agent in
the Collateral as set forth herein.
SECTION 4. COVENANTS
Each Pledgor covenants and agrees with the Agent that until the conditions
for release of the Collateral set forth in Section 2.5 have been satisfied and
the Collateral is released pursuant to Section 2.5, such Pledgor will comply
with the following:
4.1 Perfection of Security Interests.
(a) Each Pledgor will, at its expense, cause all filings and recordings
and other actions specified on Schedule 5 to have been completed and filed on or
prior to the Effective Date.
(b) Each Pledgor which is the holder of Capital Stock of a Foreign
Subsidiary will pledge such Capital Stock and perfect the Agent's security
interest therein in the case of the pledge of the Capital Stock of any other
Foreign Subsidiary, pursuant to the terms hereof and, if required by the laws of
the applicable jurisdiction, a pledge agreement in form and substance
satisfactory to the Agent.
4.2 Further Actions.
(a) At all times after the Effective Date, each Pledgor will, at its
own expense, comply with the following:
(i) as to all General Intangibles and Pledged Securities, it will
cause UCC financing statements and continuation statements to be filed and to be
on file in all applicable jurisdictions (except with respect to goods in
transit) as required to perfect the security interests granted to the Agent for
the ratable benefit of the Secured Parties hereunder, to the extent that
applicable law permits perfection. of a security interest by filing under the
UCC;
(ii) as to all Proceeds, it will cause all UCC financing statements
and continuation statements filed in accordance with clause (i) above to include
a
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statement or a checked box indicating that Proceeds of all items of Collateral
described therein are covered;
(iii) upon the request of the Agent, it will ensure that the
provisions of Section 5.1(b) are complied with;
(iv) as to any Capital Stock owned or hereafter acquired by any
Pledgor, the applicable Pledgor will immediately pledge and deliver the
corresponding certificates, upon the acquisition or certification thereof, or
other instruments to the Agent for the benefit of the Secured Parties as part of
the Pledged Interests duly endorsed in a manner reasonably satisfactory to the
Agent;
(v) as to any Capital Stock of any Foreign Subsidiary owned or
hereafter acquired by any Pledgor, the applicable Pledgor will immediately
deliver pledge agreements and other documents and instruments as may be required
under the laws of that applicable jurisdiction, all, in form and substance
satisfactory to the Agent, as necessary to effect the pledge of the Capital
Stock, and perfection of the Agent's security interest therein, under the laws
of such jurisdiction; and
(vi) as to any amount payable under or in connection with any of
the Collateral which shall be or shall become evidenced by any promissory note,
chattel paper or other instrument, the applicable Pledgor will immediately
pledge and deliver such note or other instrument to the Agent for the benefit of
the Secured Parties as part of the Pledged Debt duly endorsed in a manner
satisfactory to the Agent.
(b) Each Pledgor will, from time to time and at its own expense,
execute, deliver, file or record such financing statements pursuant to the UCC
and such other statements, assignments, instruments, documents, agreements or
other papers and take any other action that may be necessary or desirable, or
that the Agent may reasonably request, in order to create, preserve, perfect,
confirm or validate the security interests, to enable the Agent and the Secured
Parties to obtain the full benefits of this Pledge Agreement or to enable the
Agent to exercise and enforce any of its rights, powers and remedies hereunder,
including, without limitation, its right to take possession of the Collateral.
(c) To the fullest extent permitted by law, each Pledgor authorizes the
Agent (i) to sign and file financing and continuation statements and amendments
thereto with respect to the Collateral without its signature thereon and (ii) to
the fullest extent permitted by law, file this Pledge Agreement in any UCC
filing jurisdiction as a financing statement with respect to the Collateral. In
furtherance of the foregoing, each Pledgor hereby irrevocably constitutes and
appoints the Agent, with full power of substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of such Pledgor and in the name of such Pledgor, or in its own name, from
rime to time in the Agent's reasonable discretion, to execute, deliver, file or
record
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financing statements pursuant to the UCC as may be necessary or desirable, in
order to create, preserve, perfect, confirm or validate the security interests.
4.3 Change of Name, Identity or Structure. No Pledgor will change its name,
identity or corporate structure in any manner except to the extent expressly
permitted under Section 7.4 of the Credit Agreement. Furthermore, no Pledgor
shall take any such action permitted under Section 7.4 of the Credit Agreement
unless it shall have given the Agent at least thirty (30) days' prior written
notice thereof and shall have taken all action (or made arrangements to take
such action substantially simultaneously with such change if it is impossible to
take such action in advance) necessary or desirable or as may be reasonably
requested by the Agent, to amend any financing statement or continuation
statement relating to the security interests granted hereby in order to preserve
such security interests and to effectuate or maintain the priority thereof
against all persons.
4.4 Place of Business and Collateral. No Pledgor will change the location
of (a) any of its places of business, (b) its chief executive offices or (c) any
of the offices or other locations where it keeps or holds any Collateral or any
records relating thereto from the applicable location listed on Schedule 2
hereto (including the establishment of any new office or facility) unless, prior
to such change, (i) it notifies the Agent of such change, (ii) makes all UCC
filings required by Section 4.2 and (iii) takes all other action necessary or
desirable or that the Agent may reasonably request, to preserve, perfect,
confirm and protect the security interests granted hereby. No Pledgor will
change the location of any Collateral if such change would cause the security
interest granted hereby in such Collateral to lapse or cease to be perfected.
4.5 Maintenance of Records. Each Pledgor will keep and maintain at its own
cost and expense complete books and records relating to the Collateral which are
reasonably satisfactory to the Agent, including, without limitation, a record of
all payments received and all credits granted with respect to the Collateral and
all of its other dealings with the Collateral. Each Pledgor will ▇▇▇▇ its
instruments and chattel paper to evidence this Pledge Agreement and the security
interests granted hereby. For the further security of the Agent and the other
Secured Parties, each Pledgor agrees that the Agent shall have a special
property interest in each Pledgor's Documents and chattel paper and, upon the
occurrence and during the continuance of an Event of Default, such Pledgor shall
deliver and turn over any Document or chattel paper to the Agent or to its
representatives at any time on demand of the Agent.
4.6 Compliance with Law. Each Pledgor will comply with all Requirements of
Law applicable to it and the Collateral or any part thereof or to the operation
of such Pledgor's business to the extent that noncompliance with any such
Requirement of Law could reasonably be expected to have a Material Adverse
Effect.
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4.7 Payment of Taxes. Each Pledgor will pay and discharge (a) all taxes,
assessments and other governmental charges or levies imposed upon it, or upon
its income or profits, or upon the Collateral, before they shall become
delinquent and (b) all lawful claims (including claims for labor, materials and
supplies) which, if unpaid, might give rise to a Lien upon the Collateral;
provided, that no Pledgor shall be required to pay any such tax, assessment,
charge, levy or claim which is being contested in good faith by appropriate
proceedings diligently pursued and as to which adequate reserves therefor have
been established in accordance with GAAP, unless the failure to make any such
payment (i) could give rise to an immediate right to foreclose on a Lien
securing such amounts or (ii) could reasonably be expected to have a Material
Adverse Effect.
4.8 Limitation on Liens on Collateral. No Pledgor will create, permit or
suffer to exist, but will defend the Collateral and each Pledgor's rights with
respect thereto against and take such other action as is necessary to remove,
any security interest, encumbrance, claim or other Lien in respect of the
Collateral other than the security interests created hereunder and the Liens
permitted under Section 7.2 of the Credit Agreement.
4.9 Maintenance of Insurance. The Pledgors, at their own expense, shall
maintain or cause to be maintained insurance required by Section 6.6 of the
Credit Agreement. Each Pledgor irrevocably makes, constitutes and appoints the
Agent (and all officers, employees or agents designated by the Agent) as such
Pledgor's true and lawful agent (and attorney-in-fact) for the purpose, during
the continuance of an Event of Default, of making, settling and adjusting claims
in respect of Collateral under policies of insurance, endorsing the name of such
Pledgor on any check, draft, instrument or other item of payment for the
proceeds of such policies of insurance and for making all determinations and
decisions with respect thereto. In the event that any Pledgor at any time or
times shall fail to obtain or maintain any of the policies of insurance required
hereby or to pay any premium in whole or part relating thereto, the Agent may,
without waiving or releasing any obligation or liability of the Pledgors
hereunder or any Event of Default, in its sole discretion, obtain and maintain
such policies of insurance and pay such premium and take any other actions with
respect thereto as the Agent deems advisable. All sums disbursed by the Agent in
connection with this Section 4.9, including reasonable and invoiced attorneys'
fees (excluding the costs of internal counsel), court costs, out-of-pocket
expenses and other charges relating thereto, shall be payable, upon demand, by
the Pledgors to the Agent and shall be additional Secured Obligations secured
hereby.
4.10 Limitations on Dispositions of Collateral. No Pledgor will directly or
indirectly (through the sale of stock, merger or otherwise) sell, transfer,
lease or otherwise dispose of any of the Collateral, or attempt, offer or
contract to do so, except as permitted under Section 2.5. The inclusion of
Proceeds of the Collateral under the security interests granted under Section
2.1 shall not be deemed a consent by the
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Agent to any sale or disposition of any Collateral other than as permitted by
this Section 4.10.
4.11 Periodic Certification. Each year, at the time of delivery of annual
financial statements with respect to the preceding fiscal year pursuant to
Section 6.1(a) of the Credit Agreement, the Borrower shall deliver to the Agent
a certificate executed by a financial officer of the Borrower (as to which
certificate there shall be no individual, as opposed to corporate, liability)
(a) setting forth the chief executive officer and principal place of business
for each Pledgor, (b) certifying that all UCC financing statements or other
appropriate filings, recordings or registrations, including all refilings,
rerecordings and reregistrations, containing a description of the Collateral
have been filed of record in each governmental, municipal or other appropriate
office in each jurisdiction identified pursuant to clause (a) above to the
extent necessary to protect and perfect the security interests created under
Section 2.1 for a period of not less than eighteen (18) months after the date of
such certificate and (c) certifying that the Borrower and each Pledgor have
complied with all actions required to be taken by the Borrower or such Pledgor
under Section 4.2(a).
4.12 Notices. Each Pledgor will advise the Agent promptly and in reasonable
detail after it becomes aware of, (a) any security interest, material
encumbrance or material claim made or other Lien (other than Permitted Liens)
asserted against any of the Collateral, (b) any material change in the
composition of the Collateral and (c) the occurrence of any other event which is
reasonably likely to have a material adverse effect on the aggregate value of
the Collateral or on the security interests granted to the Agent in this Pledge
Agreement.
4.13 Change of Law. Each Pledgor shall promptly notify the Agent in writing
of any change in law known to it which (a) materially adversely affects or will
materially adversely affect the validity, perfection or priority of the security
interests granted hereby, (b) requires or will require a change in the
procedures to be followed in order to maintain and protect such validity,
perfection and priority or (c) could result in the Agent not having a perfected
security interest in any of the Collateral.
4.14 Right of Inspection. Subject to the terms of Section 10.14 of the
Credit Agreement, each Pledgor will, at such Pledgor's cost and expense, permit
any representatives designated by the Agent or the Required Lenders to visit and
inspect the financial records or any of the other Collateral of such Pledgor at
reasonable times and as often as reasonably requested, and to make extracts from
and copies of such financial records, and permit any representatives designated
by the Agent or the Required Lenders to discuss the affairs, finances and
condition of such Pledgor with the officers thereof and independent accountants
therefor (with representatives of the Borrower present unless an Event of
Default or Default has occurred and is continuing).
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4.15 Reimbursement Obligation. Should any Pledgor fail to comply with the
provisions of this Pledge Agreement or any other agreement relating to the
Collateral (including any Capital Lease obligation or other lease obligation)
such that the value of any Collateral or the validity, perfection, rank or value
of any security interest granted to the Agent hereunder or thereunder is thereby
diminished or potentially diminished in any material respect or put at risk in
any material respect (as reasonably determined by the Agent), the Agent on
behalf of such Pledgor may, but shall not be required to, effect such compliance
on behalf of such Pledgor, and such Pledgor shall reimburse the Agent for the
costs thereof actually incurred (but not the fees of internal counsel) on
demand, and interest shall accrue on any such unpaid reimbursement obligation
from the date the relevant costs are incurred until reimbursement thereof in
full at the default rate provided in Section 3.1 of the Credit Agreement.
4.16 Amendments to Schedules. Each Pledgor has a continuing obligation
hereunder to amend, revise and update, as need be, any and all schedules hereto
so that such schedules accurately reflect in all material respects the
information set forth therein.
SECTION 5. DISTRIBUTIONS ON PLEDGED SECURITIES; VOTING
5.1 Right to Receive Distributions on Pledged Collateral; Voting.
(a) So long as no Event of Default shall have occurred and be
continuing:
(i) Each Pledgor shall be entitled to exercise any and all voting and
other consensual rights pertaining to the Pledged Interests or any part
thereof for any purpose permitted by the terms of this Pledge Agreement and
the Credit Agreement.
(ii) Each Pledgor shall be entitled to receive and retain any and all
dividends, interest and principal paid in cash on the Pledged Securities to
the extent and only to the extent that such cash dividends, interest and
principal are permitted by, and otherwise paid in accordance with, the
terms and conditions of the Credit Agreement and applicable laws. Other
than pursuant to the first sentence of this paragraph (a)(ii), or as
otherwise permitted to be retained by a Pledgor pursuant to the Credit
Agreement, all principal, all noncash dividends, interest and principal,
and all dividends, interest and principal 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 made on or in respect of Pledged Securities, 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 Securities or received in exchange for Pledged
Securities or any part thereof, or in redemption thereof, or
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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 a Pledgor, shall not be
commingled by such Pledgor with any of its other funds or property but
shall be held separate and apart therefrom, shall be held in trust for the
benefit of the Agent and shall be forthwith delivered to the Agent in the
form in which received (with any necessary endorsement).
(iii) The Agent shall execute and deliver (or cause to be executed and
delivered) to each Pledgor all such proxies, powers of attorney, consents,
ratifications and waivers and other instruments as each Pledgor may
reasonably request for the purpose of enabling each Pledgor to exercise the
voting and other rights which it is entitled to exercise pursuant to
paragraph (i) above and to receive the dividends or interest payments which
it is authorized to receive and retain pursuant to paragraph (ii) above.
(b) Upon the occurrence and during the continuance of an Event of
Default:
(i) All rights of any Pledgor to receive the dividends and interest
payments which it would otherwise be authorized to receive and retain
pursuant to Section 5.1(a)(ii) shall cease, and all such rights shall
thereupon become vested in the Agent which shall thereupon have the sole
right to receive and hold as Collateral such dividends and interest
payments.
(ii) All dividends and interest payments which are received by any
Pledgor contrary to the provisions of paragraph (i) of this Section 5.1(b)
shall be received in trust for the benefit of the Agent, shall be
segregated from other funds of such Pledgor and shall be forthwith paid
over to the Agent as Collateral in the same form as so received (with any
necessary endorsement).
(c) Upon the occurrence and during the continuance of an Event of Default,
all rights of each Pledgor to exercise the voting and other consensual rights
which it would otherwise be entitled to exercise pursuant to Section 5.1(a)(i)
shall cease, and all such rights shall thereupon become vested in the Agent,
which shall thereupon have the sole right to exercise such voting and other
consensual rights.
SECTION 6. REMEDIES; RIGHTS UPON DEFAULT
6.1 UCC Rights. If any Event of Default shall have occurred, the Agent may,
in addition to all other rights and remedies granted to it in this Pledge
Agreement and in any other instrument or agreement securing, evidencing or
relating to the Secured Obligations, exercise all rights and remedies of a
secured party under the UCC and all other rights available to the Agent at law
or in equity.
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6.2 Possession of Collateral. In furtherance of the foregoing, each Pledgor
expressly agrees that, if an Event of Default shall occur and be continuing, the
Agent may (a) by judicial powers, or without judicial process if it can be done
without breach of the peace, enter any premises where any of such Collateral is
or may be located, and without charge or liability to the Agent seize and remove
such Collateral from such premises and (b) have access to and use of such
Pledgor's Documents.
6.3 Sale of Collateral.
(a) Each Pledgor expressly agrees that if an Event of Default shall
occur and be continuing, the Agent, without demand of performance or other
demand or notice of any kind (except the notice specified below of the time and
place of any public or private sale) to any Pledgor or any other person (all of
which demands and/or notices are hereby waived by each Pledgor), may forthwith
collect, receive, appropriate and realize upon the Collateral and/or forthwith
sell, lease, assign, give an option or options to purchase or otherwise dispose
of and deliver the Collateral (or contract to do so) or any part thereof in one
or more parcels at public or private sale, at any exchange, broker's board or at
any office of the Agent or elsewhere in such manner as is commercially
reasonable and as the Agent may deem best, for cash or on credit or for future
delivery without assumption of any credit risk. The Agent or any Secured Party
shall have the right upon any such public sale and, to the extent permitted by
law, upon any such private sale, to purchase the whole or any part of the
Collateral so sold. Each Pledgor further agrees, at the Agent's request, to
assemble the Collateral, and to make it available to the Agent at places which
the Agent may reasonably select. To the extent permitted by applicable law, each
Pledgor waives all claims, damages and demands against the Agent or any Secured
Party arising out of the foreclosure, repossession, retention or sale of the
Collateral in accordance with the terms and conditions contained in this Pledge
Agreement.
(b) Unless the Collateral threatens to decline quickly in value or is of
a type customarily sold in a recognized market, the Agent shall give such
Pledgor ten (10) days written notice of its intention to make any such public or
private sale or sale at a broker's board or on a securities exchange. Such
notice shall (i) in the case of a public sale, state the time and place fixed
for such sale, (ii) in the case of a sale at a broker's board or on a securities
exchange, state the board or exchange at which such sale is to be made and the
day on which the Collateral, or any portion thereof being sold, will first be
offered for sale and (iii) in the case of a private sale, state the day after
which such sale may be consummated. The Agent shall not be required or obligated
to make any such sale pursuant to any such notice. The Agent may 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 the sale, and such sale may be made
at any time or place to which the same may be so adjourned. In the case of any
sale of all or any part of the Collateral for credit or for future delivery, the
Collateral so sold may be retained by the Agent until the selling price is paid
by the purchaser thereof, but the Agent shall not
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incur any liability in case of failure of such purchaser to pay for the
Collateral so sold and, in the case of such failure, such Collateral may again
be sold upon like notice.
6.4 Rights of Purchasers. Upon any sale of the Collateral (whether public
or private), the Agent shall have the right to deliver, assign and transfer to
the purchaser thereof the Collateral so sold. Each purchaser (including the
Agent and the other Secured Parties) at any such sale shall hold the Collateral
so sold free from any claim or right of whatever kind, including any equity or
right of redemption of any Pledgor, and each Pledgor, to the extent permitted by
law, hereby specifically waives all rights of redemption, including the right to
redeem the Collateral under ss. 9-506 of the UCC, and any right to a judicial or
other stay or approval which it has or may have under any law now existing or
hereafter adopted.
6.5 Additional Rights of the Agent. Upon the occurrence and during the
continuance of an Event of Default:
(a) The Agent shall have the right and power to institute and maintain
such suits and proceedings as it may deem appropriate to protect and enforce the
rights vested in it by this Pledge Agreement and may proceed by suit or suits at
law or in equity to enforce such rights and to foreclose upon and sell the
Collateral or any part thereof pursuant to the judgment or decree of a court of
competent jurisdiction.
(b) The Agent shall, to the extent permitted by law and without regard
to the solvency or insolvency at the time of any person then liable for the
payment of any of the Secured Obligations or the then value of the Collateral,
and without requiring any bond from any party to such proceedings, be entitled
to the appointment of a special receiver or receivers (who may be the Agent or
any other Secured Party) for the Collateral or any part thereof and for the
rents, issues, tolls, profits, royalties, revenues and other income therefrom,
which receiver shall have such powers as the court making such appointment shall
confer, and to the entry of an order directing that the rents, issues, tolls,
profits, royalties, revenues and other income of the property constituting the
whole or any part of the Collateral be segregated, sequestered and impounded for
the benefit of the Agent and the other Secured Parties, and each Pledgor
irrevocably consents to the appointment of such receiver or receivers and to the
entry of such order.
6.6 Securities Act, etc.
(a) In view of the position of the applicable Pledgor in relation to its
Pledged Securities, or because of other present 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
herein called the "Federal Securities Laws"), with respect to any disposition of
the Pledged Securities permitted hereunder. Each
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Pledgor understands that compliance with the Federal Securities Laws might very
strictly limit the course of conduct of the Agent if the 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 such
Pledged Securities could dispose of the same. Similarly, there may be other
legal restrictions or limitations affecting the Agent and the other Secured
Parties 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.
Accordingly, each Pledgor expressly agrees that the Agent is authorized, in
connection with any sale of the Pledged Securities, if the Agent reasonably
deems it advisable so to do, (a) to restrict the prospective bidders on or
purchasers of any of the Pledged Securities to a limited number of sophisticated
investors who will represent and agree that they are purchasing for their own
account for investment and not with a view to the distribution or sale of any of
such Pledged Securities, (b) to cause to be placed on certificates for any or
all of the Pledged Securities or on any other securities pledged hereunder a
legend to the effect that such security has not been registered under the
Federal Securities Laws and may not be disposed of in violation of the provision
of the Federal Securities Laws and (c) to impose such other limitations or
conditions in connection with any such sale as the Agent reasonably deems
necessary or advisable in order to comply with the Federal Securities Laws or
any other applicable law. Each Pledgor covenants and agrees that, upon the
occurrence and during the continuance of an Event of Default, it will execute
and deliver such documents and take such other action as the Agent deems
necessary or advisable in order to comply with the Federal Securities Laws or
any other applicable law. Each Pledgor acknowledges and agrees that such
limitations may result in prices and other terms less favorable to the seller
than if such limitations were not imposed, and, therefore, agrees that any such
sale shall not be deemed by reason of such limitations to have not been made in
a commercially reasonable manner, it being the agreement of each Pledgor, the
Agent and the other Secured Parties that the provisions of this Section 6.6 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 Agent
sells the Pledged Securities. The Agent shall be under no obligation to delay a
sale of any Pledged Securities for a period of time necessary to permit the
issuer of any securities contained therein to register such securities under the
Federal Securities Laws, or under applicable state securities laws, even if the
issuer would agree to do so.
(b) If the Agent shall determine to exercise its right to sell all or
any of the Pledged Securities and if in the opinion of counsel for the Agent it
is necessary, or if in the opinion of the Agent it is advisable, to have the
securities included in the Pledged Securities or the portion thereof to be sold
registered under the provisions of the Federal Securities Laws, each Pledgor
agrees, at its own expense, (i) to execute and deliver, and to use its best
efforts to cause its directors and officers to execute and deliver, all such
instruments and documents, and to do or cause to be done all other
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such acts and things, as may be necessary or, in the reasonable opinion of the
Agent, advisable to register such securities under the provisions of the Federal
Securities Laws and to cause the registration statement relating thereto to
become effective and to remain effective for such period as prospectuses are
required by law to be furnished, and to make or cause to be made all amendments
and supplements thereto and to the related prospectus which, in the opinion of
the Agent, are necessary or advisable, all in conformity with the requirements
of the Federal Securities Laws and the rules and regulations of the Securities
and Exchange Commission thereunder, (ii) to prepare, and to make available to
the security holders of the issuer of any such Pledged Securities as soon as
practicable, an earnings statement (which need not be audited) covering the
period of at least twelve (12) months beginning with the first month after the
effective date of any such registration statement, which earning statement will
satisfy the provisions of Section 11(a) of the Federal Securities Laws, (iii) to
use its best efforts to qualify such securities under state blue sky or
securities laws and to obtain the approval of any governmental authorities for
the sale of such securities as requested by the Agent and (iv) at the request of
the Agent, to indemnify and hold harmless the Agent, any other Secured Party and
any underwriters (and any person controlling any of the foregoing) from and
against any loss, liability, claim, damage and expense (and reasonable counsel
fees incurred in connection therewith) under the Federal Securities Laws or
otherwise insofar as such loss, liability, claim, damage or expense arises out
of or is based upon any untrue statement or alleged untrue statement of a
material fact contained in such registration statement or prospectus furnished
by Pledgor or in any preliminary prospectus or any amendment or supplement
thereto furnished by Pledgor, or arises out of or is based upon any omission or
alleged omission to state therein a material fact required to be stated or
necessary to make the statements therein not misleading, such indemnification to
remain operative regardless of any investigation made by or on behalf of the
Agent, any other Secured Party or any underwriters (or any person controlling
any of the foregoing); provided, that, such Pledgor shall not be liable in any
case to the extent that any such loss, liability, claim, damage or expense
arises out of or is based on an untrue statement or alleged untrue statement or
an omission or an alleged omission made in reliance upon and in conformity with
written information furnished to such person by the Agent or any underwriter
expressly for use in such registration statement or prospectus.
(c) Borrower hereby acknowledges the provisions of Section 6.4 set forth
in the Pledge Agreement and agrees to comply with the requirements set forth in
such section as such section relates to the Borrower.
6.7 Remedies Not Exclusive.
(a) No remedy conferred upon or reserved to the Agent in this Pledge
Agreement is intended to be exclusive of any other remedy or remedies, but every
such remedy shall be cumulative and shall be in addition to every other remedy
conferred herein or now or hereafter existing at law, in equity or by statute.
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(b) If the Agent shall have proceeded to enforce any right, remedy or
power under this Pledge Agreement and the proceeding for the enforcement thereof
shall have been discontinued or abandoned for any reason or shall have been
determined adversely to the Agent, each Pledgor and the Agent shall, subject to
any determination in such proceeding, severally and respectively be restored to
their former positions and rights under this Pledge Agreement, and thereafter
all rights, remedies and powers of the Agent shall continue as though no such
proceedings had been taken.
(c) All rights of action under this Pledge Agreement may be enforced by
the Agent without the possession of any instrument evidencing any Secured
Obligation or the production thereof at any trial or other proceeding relative
thereto, and any suit or proceeding instituted by the Agent shall be brought in
its name and any judgment shall be held as part of the Collateral.
6.8 Waiver and Estoppel.
(a) Each Pledgor, to the extent it may lawfully do so, agrees that it
will not at any time in any manner whatsoever claim or take the benefit or
advantage of any appraisement, valuation, stay, extension, moratorium, turnover
or redemption law, or any law now or hereafter in force permitting it to direct
the order in which the Collateral shall be sold which may delay, prevent or
otherwise affect the performance or enforcement of this Pledge Agreement and
each Pledgor hereby waives the benefits or advantage of all such laws, and
covenants that it will not hinder, delay or impede the execution of any power
granted to the Agent in this Pledge Agreement but will permit the execution of
every such power as though no such law were in force; provided, that nothing
contained in this Section 6.8 shall be construed as a waiver of any rights of
such Pledgor under any applicable Federal bankruptcy law or the insolvency laws
of any other jurisdiction.
(b) Each Pledgor, to the extent it may lawfully do so, on behalf of
itself and all who may claim through or under it, including any and all
subsequent creditors, vendees, assignees and lienors, waives and releases all
rights to demand or to have any marshaling of the Collateral upon any sale,
whether made under any power of sale granted herein or pursuant to judicial
proceedings or upon any foreclosure or any enforcement of this Pledge Agreement
and consents and agrees that all of the Collateral may at any such sale be
offered and sold as an entirety.
(c) Each Pledgor, to the extent it may lawfully do so, waives
presentment, demand, protest and any notice of any kind (except notices
explicitly required hereunder or under the Credit Agreement) in connection with
this Pledge Agreement and any action taken by the Agent with respect to the
Collateral.
6.9 Power of Attorney. Each Pledgor hereby irrevocably constitutes and
appoints the Agent, with full power of substitution, as its true and lawful
attorney-in-fact
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with full irrevocable power and authority in the place and stead of such Pledgor
and in the name of such Pledgor or in its own name, from time to time in the
Agent's reasonable discretion for the purpose of carrying out the terms of this
Pledge Agreement, to take any and all appropriate action and to execute any and
all documents and instruments which may be necessary or desirable to accomplish
the purposes of this Pledge Agreement and, without limiting the generality of
the foregoing, hereby gives the Agent the power and right, on behalf of such
Pledgor, without notice to or assent by such Pledgor to do the following:
(a) upon the occurrence and during the continuance of any Event of
Default, to pay or discharge taxes, liens, security interests or other
encumbrances levied or placed on or threatened against the Collateral;
(b) upon the occurrence and during the continuance of any Event of
Default, to effect any repairs or any insurance called for by the terms of this
Pledge Agreement and to pay all or any part of the premiums therefor and the
costs thereof; and
(c) upon the occurrence and continuance of any Event of Default and
otherwise to the extent provided in this Pledge Agreement, (i) to direct any
party liable for any payment under any of the Collateral to make payment of any
and all moneys due and to come due thereunder directly to the Agent or as the
Agent shall direct; (ii) to receive payment of and receipt for any and all
moneys, claims and other amounts due and to become due at any time in respect of
or arising out of any Collateral; (iii) to commence and prosecute any suits,
actions or proceedings at law or in equity in any court of competent
jurisdiction to collect the Collateral or any thereof and to enforce any other
right in respect of any Collateral; (iv) to defend any suit, action or
proceeding brought against such Pledgor with respect to any Collateral; (v) to
settle, compromise and adjust any suit, action or proceeding described above
and, in connection therewith, to give such discharges or releases as the Agent
may deem appropriate; and (vi) generally to sell, transfer, pledge, make any
agreement with respect to or otherwise deal with any of the Collateral as fully
and completely as though the Agent were the absolute owner thereof for all
purposes, and to do, at the option of the Agent and each Pledgor's expense, at
any time, or from time to time, all acts and. things which the Agent reasonably
deems necessary to protect, preserve or realize upon the Collateral and the
Agent's security interest therein, in order to effect the intent of this Pledge
Agreement, all as fully and effectively as such Pledgor might do.
Each Pledgor hereby ratifies all that such attorneys shall lawfully do or
cause to be done by virtue hereof. This power of attorney is a power coupled
with an interest and shall be irrevocable. This power of attorney shall not be
affected by any Bankruptcy Event occurring in respect of any person or any
change in the legal capacity, rights or obligations of a person.
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Except as provided for by law or the UCC or its equivalent, nothing herein
contained shall be construed as requiring or obligating the Agent to make any
commitment or to make any inquiry as to the nature or sufficiency of any payment
received by the 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, and no action
taken by the Agent or omitted to be taken with respect to the Collateral or any
part thereof shall give rise to any defense, counterclaim or offset in favor of
any Pledgor or to any claim or action against the Agent. It is understood and
agreed that the appointment of the Agent as the agent of each Pledgor for the
purposes set forth above in this Section 6.9 is coupled with an interest and is
irrevocable. The provisions of this Section 6.9 shall in no event relieve any
Pledgor of any of its obligations hereunder with respect to the Collateral or
any part thereof or impose any obligation on the Agent to proceed in any
particular manner with respect to the Collateral or any part thereof, or in any
way limit the exercise by the Agent of any other or further right which it may
have on the date of this Pledge Agreement or hereafter, whether hereunder or by
law or otherwise.
6.10 Application of Proceeds.
(a) The Agent shall apply the proceeds of any collection, sale or other
disposition of the Collateral as follows:
FIRST, to the payment of all reasonable costs and expenses incurred by the
Agent (in its capacity as such hereunder or under any other Credit
Document) and the Lenders in connection with such collection or sale or
otherwise in connection with this Pledge Agreement or any of the Secured
Obligations, including all court costs and the reasonable fees and expenses
of their agents and legal counsel (but excluding the costs of internal
counsel), the repayment of all reasonable advances made by the Agent and
the Lenders hereunder or under any other Credit Document and all reasonable
costs or expenses incurred in connection with the exercise of any right or
remedy hereunder or under any other Credit Document;
SECOND, to the payment in full of all Secured Obligations (the amounts so
applied to be distributed among the Secured Parties pro rata in accordance
with the amounts of the Secured Obligations owed to them on the date of any
such distribution) at the time due and payable; and
THIRD, to each Pledgor, its successors or assigns, if all conditions to the
release of the Collateral specified in Section 2.5 shall have been
fulfilled, but if any such condition shall not have been fulfilled, to be
held by the Agent and thereafter applied to any other payments required to
be made in accordance with subdivisions First and Second above.
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(b) The Agent shall have absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Pledge Agreement. Upon any sale of the Collateral by the Agent (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the Agent or of the officer making the sale shall be a sufficient
discharge to the purchaser or purchasers of the Collateral so sold and such
purchaser or purchasers shall not be obligated to see to the application of any
part of the purchase money paid over to the Agent or such officer or be
answerable in any way for the misapplication thereof.
(c) In the event that the proceeds of any collection, recovery,
receipt, appropriation, realization or sale as aforesaid are insufficient to pay
all amounts to which the Agent or any or all of the Lenders are legally
entitled, the Pledgors will be jointly and severally liable for the deficiency,
together with interest thereon, at the default rate set forth in Section 3.1 of
the Credit Agreement, and the reasonable fees of any attorneys (but excluding
the fees and costs of internal counsel) employed by the Agent or any or all of
the Lenders to collect such deficiency, pursuant to the Credit Agreement.
SECTION 7. MISCELLANEOUS
7.1 Notices. Except as otherwise expressly provided herein, all notices and
other communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device) to the
number, with telephonic confirmation of receipt, in the case of the Borrower and
the Agent, set forth in Section 10.1 of the Credit Agreement and in the case of
the Subsidiary Pledgors, set forth on the signature pages hereof, (c) on the
Business Day following the day on which the same has been delivered prepaid to a
reputable national overnight air courier service or (d) on the fifth Business
Day following the day on which the same is sent by certified or registered mail,
postage prepaid, in each case to the respective parties at the address, in the
case of the Borrower and the Agent, set forth in Section 10.1 of the Credit
Agreement, and, in the case of the Subsidiary Pledgors, set forth on the
signature pages hereof, or at such other address as such party may specify by
written notice to the other parties hereto.
7.2 Survival of Agreement. All covenants, agreements, representations and
warranties made by each Pledgor herein and in the certificates or other
instruments prepared or delivered in connection with or pursuant to this Pledge
Agreement shall be considered to have been relied upon by the Agent and the
Secured Parties and shall survive the making by the Lenders of the Loans and the
execution and delivery to the Lenders of the Notes evidencing such Loans,
regardless of any investigation made by the Lenders or on their behalf, and
shall continue in full force and effect until the Secured Obligations have been
indefeasibly paid in full in cash, the Commitments have been terminated, and all
terms and conditions hereof, the Credit Agreement, the Notes, the Collateral
Documents and all other documents or agreements governing the
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Secured Obligations have been satisfied. This Pledge Agreement shall terminate
when the security interests granted hereunder have terminated and the Collateral
has been released as provided in Section 2.5; provided, that the obligations of
each Pledgor under Section 4.15 shall survive any such termination.
7.3 Counterparts. This Pledge Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall constitute one and the same instrument. It shall not be
necessary in making proof of this Pledge Agreement to produce or account for
more than one such counterpart for each of the parties hereto. Delivery by
facsimile by any of the parties hereto of an executed counterpart of this Pledge
Agreement shall be as effective as an original, executed counterpart hereof and
shall be deemed a representation that an original executed counterpart hereof
will be delivered, but the failure to deliver a manually executed counterpart
shall not affect the validity, enforceability, or binding effect of this Pledge
Agreement.
7.4 Amendments. Etc. No amendment, modification or waiver of any provision
of this Pledge Agreement and no consent to any departure by any Pledgor
therefrom shall in any event be effective unless the same shall be in writing
and shall be executed and delivered in accordance with Section 10.6 of the
Credit Agreement, and then such amendment, modification, waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided, that this Pledge Agreement may be amended, modified or
waived with respect to any Pledgor, including by releasing any Pledgor
hereunder, without the approval of any other Pledgor and without affecting the
obligations of any other Pledgor hereunder.
7.5 Assignments. This Pledge Agreement and the terms, covenants and
conditions hereof shall be binding upon each Pledgor and its successors and
shall inure to the benefit of the Agent and the Secured Parties and their
respective successors and assigns. Upon the assignment by any Lender of all or
any portion of its rights and obligations under the Credit Agreement (including
all or any portion of its Commitment and the Loans owing to it) to any other
person, such other person shall thereupon become vested with all the benefits in
respect thereof granted to such transferor or assignor herein or otherwise. None
of the Pledgors shall be permitted to assign, transfer or delegate any of its
rights or obligations under this Pledge Agreement (and any such purported
assignment, transfer or delegation without such consent shall be void).
7.6 Severability. If any provision of any of this Pledge Agreement is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions. The parties hereto 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.
-23-
7.7 Joinder Agreement. Upon execution and delivery by the Agent and a
Domestic Subsidiary of a Joinder Agreement substantially in the form of Exhibit
J to the Credit Agreement, such Domestic Subsidiary shall become a Pledgor
hereunder with the same force and effect as if originally named as a Pledgor
herein. The execution and delivery of any such instrument shall not require the
consent of any other Pledgor hereunder. The rights and obligations of each
Pledgor hereunder shall remain in full force and effect notwithstanding the
addition of any new Pledgor as a party to this Pledge Agreement.
7.8 GOVERNING LAW; Submission to Jurisdiction; Venue.
(a) THIS PLEDGE AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF OHIO, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAWS. Any legal action or proceeding with respect to this Pledge
Agreement may be brought in the courts of the State of Ohio in ▇▇▇▇▇▇▇▇ County,
or of the United States for the Southern District, Western Division of Ohio,
and, by execution and delivery of this Pledge Agreement, each Pledgor hereby
irrevocably accepts for itself and in respect of its property, generally and
unconditionally, the nonexclusive jurisdiction of such courts. Each Pledgor
further irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to it at the address
set forth for notices pursuant to Section 7.1, such service to become effective
five (5) days after such mailing. Nothing herein shall affect the right of the
Agent to serve process in any other manner permitted by law or to commence legal
proceedings or to otherwise proceed against any Credit Party in any other
jurisdiction.
(b) Each Pledgor hereby irrevocably waives any objection which it may
now or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Pledge Agreement brought
in the courts referred to in subsection (a) above and hereby further irrevocably
waives and agrees not to plead or claim in any such court that any such action
or proceeding brought in any such court has been brought in an inconvenient
forum.
(c) TO THE EXTENT PERMITTED BY LAW, EACH OF THE AGENT, THE SECURED
PARTIES AND THE PLEDGORS HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS PLEDGE
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
(d) Without limiting the generality of Sections 7(a), 7(b) or 7(c) each
Subsidiary Pledgor agrees to comply to the fullest extent with all laws
including without limitation all legislation, regulations, statutory rules and
bylaws of any government, whether local, state, provincial, federal or otherwise
applicable in any jurisdiction to which the Collateral is attached or situated
and such laws will apply with respect to this Pledge Agreement to the extent
reasonably necessary.
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7.9 Entirety. This Pledge Agreement, the other Credit Documents and the
Lender Hedging Agreements, if any, constitute the entire agreement between the
parties regarding the subject matter hereof and supersede all prior agreements
and understanding, oral or written, if any (including any commitment letters or
correspondence) relating to such subject matters. Nothing in this Pledge
Agreement or any other Credit Document, expressed or implied, is intended to
confer upon any party (other than the parties hereto and the Secured Parties),
any rights, remedies, obligations or liabilities under or by reason of this
Pledge Agreement or any other Credit Document.
7.10 No Waiver; Remedies. No failure on the part of the Agent or any
Secured Party to exercise, and no delay in exercising, any right, power or
remedy hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or remedy by such person preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy. All remedies hereunder and under the Credit Documents are cumulative and
are not exclusive of any other remedies provided by law.
7.11 Headings. Section headings and the Table of Contents used herein are
for convenience of reference only, are not part of this Pledge Agreement and are
not to affect the construction of, or to be taken into consideration in
interpreting, this Pledge Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Pledge Agreement to
be duly executed by their respective authorized officers as of the day and year
first written above.
▇▇▇▇▇▇ DELAWARE INC., ▇▇▇▇▇▇ INTERNATIONAL INC.,
as Pledgor as Pledgor
By:______________________________ By:______________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President Vice President
Address: 1200 ▇▇▇▇▇ Tower Address: 1200 ▇▇▇▇▇ Tower
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
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HEALTH CARE COMMUNICATIONS INC., ▇▇▇▇▇▇ U.K. INC., as Pledgor
as Pledgor
By:______________________________ By:____________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President Vice President
Address: 1200 ▇▇▇▇▇ Tower Address: 1200 ▇▇▇▇▇ Tower
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
BANK ONE, NA, as Agent
By:_____________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
First Vice President
Address: Bank One Towers
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇-▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
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Pledge Agreement
Schedule 1
SUBSIDIARY PLEDGORS
▇▇▇▇▇▇ U.K. Inc.
Health Care Communications Inc.
▇▇▇▇▇▇ Delaware Inc.
Pledge Agreement
Schedule 2
CHIEF EXECUTIVE OFFICE
▇▇▇▇▇▇ International Inc.
1200 ▇▇▇▇▇ Tower
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ U.K. Inc.
1200 ▇▇▇▇▇ Tower
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Health Care Communications Inc.
1200 ▇▇▇▇▇ Tower
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ Delaware Inc.
1200 ▇▇▇▇▇ Tower
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Pledge Agreement
Schedule 3
PART I - PLEDGED SECURITIES
Outstanding
Shares/Shares Stock
Pledgor Issuer Pledged Certificate
------------------------- -------------------- -------------- -------------
▇▇▇▇▇▇ International Inc. ▇▇▇▇▇▇ U.K. Inc. 100/100 3
▇▇▇▇▇▇ International Inc. ACER/EXCEL, Inc. 4,444/4,444 12
▇▇▇▇▇▇ International Inc. Health Care
Communications Inc. 100/100 1
▇▇▇▇▇▇ International Inc. ▇▇▇▇▇▇ Delaware Inc. 1,000/1,000 1
▇▇▇▇▇▇ International Inc. AAC Consulting Group,
Inc. 3,000,000/ 14
3,000,000
▇▇▇▇▇▇ International Inc. ▇▇▇▇▇▇ International 100% of
CPU LLC Membership Uncertificated
Interest
▇▇▇▇▇▇ U.K. Inc. ▇▇▇▇▇▇ International 299/194 Uncertificated
B.V. (Formerly
U-Gene Research B.V.)
▇▇▇▇▇▇ U.K. Inc. ▇▇▇▇▇▇ GmbH (formerly 1/.65 Uncertificated
▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
GmbH)
▇▇▇▇▇▇ U.K. Inc. ▇▇▇▇▇▇ Vermogenver 1/.65 Uncertificated
-waltungs GmbH
▇▇▇▇▇▇ U.K. Inc. ▇▇▇▇▇▇ Canada Inc. 126,523/ TBD
82,239
▇▇▇▇▇▇ U.K. Inc. ▇▇▇▇▇▇ International 100/65 7
Holdings Limited
▇▇▇▇▇▇ U.K. Inc. ▇▇▇▇▇▇ International 4,500,002/ TBD
Holdings Pty Limited 2,925,001
▇▇▇▇▇▇ U.K. Inc. ▇▇▇▇▇▇ International 4,000/ Uncertificated
SARL 2,600
Outstanding
Pledgor Issuer Partnership Interests
------------------------------- -------------------- -----------------------
Health Care Communications Inc. ▇▇▇▇▇▇ HCC LP 1% General Partnership
Interest
Health Care Communications Inc. ▇▇▇▇▇▇ New Jersey LP 1% General Partnership
Interest
▇▇▇▇▇▇ Delaware Inc. ▇▇▇▇▇▇ HCC LP 99% Limited Partnership
Interest
▇▇▇▇▇▇ Delaware Inc. ▇▇▇▇▇▇ New Jersey LP 99% Limited Partnership
Interest
PART II - PLEDGED DEBT
1. Intercompany Note dated as of December 1, 1998 in the amount of DM
1,036,405 payable by ▇▇▇▇▇▇ Vermogenverwaltungs GmbH, a corporation organized
under the laws of Germany, to the order of ▇▇▇▇▇▇ International Inc.
2. Intercompany Note dated as of August 1, 1998 in the amount of
$4,000,000 payable by ▇▇▇▇▇▇ International B.V., a corporation organized under
the laws of The Netherlands, to the order of ▇▇▇▇▇▇ International Inc.
3. Loan Agreement dated as of August 22, 1997 evidencing a loan in the
principal amount of DM 14,625,000 payable by ▇▇▇▇▇▇ Vermogenverwaltungs GmbH, a
corporation organized under the laws of Germany, to the order of ▇▇▇▇▇▇
International Inc.
-2-
Pledge Agreement
Schedule 4
TRADE NAMES
▇▇▇▇▇▇
ACER
ACER/EXCEL
gmi
U-Gene
HCC
Health Care Communications
▇▇▇▇▇▇ International
Pledge Agreement
SCHEDULE 5
Required Filings and Recordings
FILING LOCATIONS
▇▇▇▇▇▇ International Inc.
Ohio Secretary of State
▇▇▇▇▇▇ U.K. Inc.
Ohio Secretary of State
Health Care Communications Inc.
Ohio Secretary of State
▇▇▇▇▇▇ Delaware Inc.
Delaware Secretary of State