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EXHIBIT 10.4
BORROWER PLEDGE AGREEMENT
This BORROWER PLEDGE AGREEMENT (this "Pledge Agreement"), dated as of
January 28, 1999, is made by NEW WORLD PASTA COMPANY, a Delaware corporation
(the "Pledgor"), in favor of THE BANK OF NOVA SCOTIA, as lead arranger and
administrative agent (together with any successor(s) thereto in such capacity,
the "Administrative Agent") for each of the Lender Parties (as defined below).
W I T N E S S E T H:
WHEREAS, pursuant to a Credit Agreement, dated as of January 28, 1999
(as amended, supplemented, amended and restated and otherwise modified from time
to time, the "Credit Agreement"), among the Pledgor, the various financial
institutions as are, or may from time to time become, parties thereto (the
"Lenders"), the Co-Agents named therein, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding, Inc., as
Syndication Agent, and the Administrative Agent, the Lenders have extended
Commitments to make Credit Extensions to, and for the benefit of, the Pledgor;
WHEREAS, as a condition precedent to the making of each Credit
Extension (including the initial Credit Extension) under the Credit Agreement,
the Pledgor is required to execute and deliver this Pledge Agreement; and
WHEREAS, the Pledgor has duly authorized the execution, delivery and
performance of this Pledge Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged, and in order to induce the Lenders and the Issuer
to make each Credit Extension (including the initial Credit Extension) to the
Pledgor pursuant to the Credit Agreement, the Pledgor agrees, for the benefit of
each Lender Party, as follows:
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ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Terms. The following terms (whether or not
underscored) when used in this Pledge Agreement, including its preamble and
recitals, shall have the following meanings (such definitions to be equally
applicable to the singular and plural forms thereof):
"Administrative Agent" is defined in the preamble.
"Collateral" is defined in Section 2.1.
"Credit Agreement" is defined in the first recital.
"Distributions" means all stock dividends, liquidating dividends,
shares of stock resulting from (or in connection with the exercise of) stock
splits, reclassifications, warrants, options, non-cash dividends, mergers,
consolidations, and all other distributions (whether similar or dissimilar to
the foregoing) on or with respect to any Pledged Shares or other shares of
capital stock constituting Collateral, but shall not include Dividends.
"Dividends" means cash dividends and cash distributions with respect to
any Pledged Shares or other Pledged Property made in the ordinary course of
business and not a liquidating dividend.
"Lender Party" means, as the context may require, any Lender, the
Issuer, each Co-Agent and the Administrative Agent and each of their respective
successors, transferees and assigns.
"Lenders" is defined in the first recital.
"Pledge Agreement" is defined in the preamble.
"Pledged Note Issuer" means each Person identified in Item A of
Attachment 1 hereto (as it may be amended from time to time by a Supplement) as
the issuer of the Pledged Note identified opposite the name of such Person.
"Pledged Notes" means all promissory notes of any Pledged Note Issuer
(which is a Subsidiary of a Pledgor) in form satisfactory to the Administrative
Agent or substantially the form of Exhibit A hereto which are delivered by the
Pledgor to
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the Administrative Agent as Pledged Property hereunder, as such promissory
notes, in accordance with Section 4.5, are amended, modified or supplemented
from time to time and together with any promissory note of any Pledged Note
Issuer taken in extension or renewal thereof or substitution therefor.
"Pledged Property" means all Pledged Shares, all Pledged Notes, and all
other pledged shares of capital stock or promissory notes, all other securities,
all assignments of any amounts due or to become due, all other instruments
which are now being delivered by the Pledgor to the Administrative Agent or may
from time to time hereafter be delivered by the Pledgor to the Administrative
Agent for the purpose of pledge under this Pledge Agreement or any other Loan
Document, and all proceeds of any of the foregoing.
"Pledged Share Issuer" means each Person identified in Item B of
Attachment 1 hereto (as it may be amended from time to time by a Supplement) as
the issuer of the Pledged Shares identified opposite the name of such Person.
"Pledged Shares" means all shares of capital stock and equity interests
of any Pledged Share Issuer which are delivered by the Pledgor to the
Administrative Agent as Pledged Property hereunder.
"Pledgor" is defined in the preamble.
"Securities Act" is defined in Section 6.2.
"Supplement" means a Supplement to this Borrower Pledge Agreement in
the form attached hereto as Attachment II.
"U.C.C." means the Uniform Commercial Code as in effect in the State of
New York.
SECTION 1.2. Credit Agreement Definitions. Unless otherwise defined
herein or the context otherwise requires, terms used in this Pledge Agreement,
including its preamble and recitals, have the meanings provided in the Credit
Agreement.
SECTION 1.3. U.C.C. Definitions. Unless otherwise defined herein or the
context otherwise requires, terms for which meanings are provided in the U.C.C.
are used in this Pledge Agreement, including its preamble and recitals, with
such meanings.
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ARTICLE II
PLEDGE
SECTION 2.1. Grant of Security Interest. The Pledgor hereby pledges,
hypothecates, assigns, charges, mortgages, delivers, and transfers to the
Administrative Agent, for its benefit and the ratable benefit of each of the
Lender Parties, and hereby grants to the Administrative Agent, for its benefit
and the ratable benefit of the Lender Parties, a continuing security interest
in, all of the following property (the "Collateral"):
(a) all promissory notes of each Pledged Note Issuer
identified in Item A of Attachment 1 hereto;
(b) all other Pledged Notes issued from time to time;
(c) all issued and outstanding capital stock and equity
interests of each Pledged Share Issuer identified in Item B of
Attachment 1 hereto (as it may be amended from time to time by a
Supplement);
(d) all other Pledged Shares issued from time to time;
(e) all other Pledged Property, whether now or hereafter
delivered to the Administrative Agent in connection with this Pledge
Agreement;
(f) all Dividends, Distributions, interest and other payments
and rights with respect to any Pledged Property; and
(g) all proceeds of any of the foregoing.
SECTION 2.2. Security for Obligations. This Pledge Agreement secures
the payment in full of all Obligations now or hereafter existing under the
Credit Agreement, the Notes and each other Loan Document to which the Pledgor
is or may become a party, whether for principal, interest costs, fees, expenses,
or otherwise.
SECTION 2.3. Delivery of Pledged Property. All certificates or
instruments, if any, representing or evidencing any Collateral, including all
Pledged Shares and all Pledged Notes, shall be delivered to and held by or on
behalf of (and in the case of the Pledged Notes, endorsed to the order of) the
Administrative Agent pursuant hereto, for transfer by delivery, and shall be
accompanied by all necessary instruments of transfer or assignment, duly
executed in blank.
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SECTION 2.4. Continuing Security Interest; Transfer of Note. This
Pledge Agreement shall create a continuing security interest in the Collateral
and shall
(a) remain in full force and effect until payment in full of
all Obligations, the termination or expiration of all Letters of Credit
and the termination of all Commitments,
(b) be binding upon the Pledgor and its successors,
transferees and assigns, and
(c) inure, together with the rights and remedies of the
Administrative Agent hereunder, to the benefit of the Administrative
Agent and each other Lender Party.
Without limiting the foregoing clause (c), any Lender may assign or otherwise
transfer (in whole or in part) any Note or Credit Extension held by it to any
other Person or entity in accordance with the Credit Agreement, and such other
Person or entity shall thereupon become vested with all the rights and benefits
in respect thereof granted to such Lender under any Loan Document (including
this Pledge Agreement) or otherwise, subject, however, to any contrary
provisions in such assignment or transfer, and to the provisions of Section
10.11 and Article IX of the Credit Agreement. Upon (i) the sale, transfer or
other disposition of Collateral in accordance with the Credit Agreement or (ii)
the payment in full of all Obligations, the termination or expiration (or cash
collateralization) of all Letters of Credit and the termination of all
Commitments, the security interest granted herein shall automatically terminate
with respect to (x) such Collateral (in the case of clause (i)) or (y) all
Collateral (in the case of clause (ii)). Upon any such termination, the
Administrative Agent will, at the Pledgor's sole expense, deliver to the
Pledgor, without any representations, warranties or recourse of any kind
whatsoever, all certificates and instruments representing or evidencing all
Pledged Shares and all Pledged Notes as delivered to it by the Pledgor, together
with all other Collateral held by the Administrative Agent hereunder, and at the
Pledgor's sole expense execute and deliver to the Pledgor such documents and
instruments, and take such other action, as the Pledgor shall reasonably request
to evidence or more fully effect such termination.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties, etc. The Pledgor
represents and warrants unto each Lender Party, as at the date of each pledge
and delivery hereunder (including each pledge and delivery of Pledged Shares) by
the Pledgor to the Administrative Agent of any Collateral, as set forth in this
Article.
SECTION 3.1.1. Ownership, No Liens, etc. The Pledgor is the legal and
beneficial owner of, and has good and marketable title to (and has full right
and authority to pledge and assign) such Collateral, free and clear of all Liens
except any Lien granted pursuant hereto in favor of the Administrative Agent and
Liens permitted pursuant to Section 7.2.3. of the Credit Agreement.
SECTION 3.1.2. Valid Security Interest. The execution and delivery of
this Pledge Agreement, together with the delivery of such Collateral to the
Administrative Agent is effective to create a valid, perfected, first priority
security interest in such Collateral and all proceeds thereof, securing the
Obligations, enforceable in accordance with its terms against all creditors of
the Pledgor and any persons purporting to purchase such Collateral from the
Pledgor, except as enforceability may be affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting the rights of creditors generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing. Possession by the
Administrative Agent of the Collateral is the only action necessary to perfect
or protect such security interest in the Collateral subject to Section 9-306 of
the U.C.C. The Administrative Agent has sole and exclusive "control" (as defined
in Section 8-106 of the U.C.C.).
SECTION 3.1.3. As to Pledged Shares. In the case of any Pledged Shares
issued by the Borrower or any Subsidiary constituting Collateral, all of such
Pledged Shares are duly authorized and validly issued, fully paid, and
non-assessable, and constitute all of the issued and outstanding shares of
capital stock of each Pledged Share Issuer owned by the Pledgor and required to
be delivered in pledge under the terms of the Credit Agreement. The Pledgor has
no Subsidiary other than the Pledged Share Issuers.
SECTION 3.1.4. As to Pledged Notes. In the case of each Pledged Note
issued by the Borrower or any Subsidiary, all of such Pledged Notes have been
duly
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authorized, executed, endorsed, issued and delivered, and are the legal, valid
and binding obligation of the issuers thereof, and are not in default.
SECTION 3.1.5. Authorization, Approval, etc. No authorization,
approval, or other action by, and no notice to or filing with, any governmental
authority, regulatory body or any other Person is required either
(a) for the pledge by the Pledgor of any Collateral pursuant
to this Pledge Agreement or for the execution, delivery, and
performance of this Pledge Agreement by the Pledgor, or
(b) for the exercise by the Administrative Agent of the voting
or other rights provided for in this Pledge Agreement, or, except with
respect to any Pledged Shares, as may be required in connection with a
disposition of such Pledged Shares by laws affecting the offering and
sale of securities generally, the remedies in respect of the Collateral
pursuant to this Pledge Agreement.
ARTICLE IV
COVENANTS
SECTION 4.1. Protect Collateral; Further Assurances, etc. The Pledgor
will not sell, assign, transfer, pledge, or encumber in any other manner the
Collateral (except in favor of the Administrative Agent hereunder). The Pledgor
agrees that at any time, and from time to time, at the expense of the Pledgor,
the Pledgor will promptly execute and deliver all further instruments, and take
all further action, that may be necessary or desirable, or that the
Administrative Agent may reasonably request, in order to perfect and protect any
security interest granted or purported to be granted hereby or to enable the
Administrative Agent to exercise and enforce its rights and remedies hereunder
with respect to any Collateral. In the event after the date hereof the Borrower
acquires any equity or debt securities of any Subsidiary, it shall promptly (and
in any event within three Business Days after such acquisition) deliver to the
Administrative Agent (a) a Supplement providing the information required to be
set forth therein and (b) stock powers, Uniform Commercial Code financing
statements, notes and share or membership interest certificates (as appropriate)
in order to perfect the security interests intended to be created hereby.
SECTION 4.2. Stock Powers, etc. The Pledgor agrees that all Pledged
Shares (and all other shares of capital stock constituting Collateral) delivered
by the Pledgor pursuant to this Pledge Agreement will be accompanied by duly
executed
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undated blank stock powers, or other equivalent instruments of transfer
acceptable to the Administrative Agent. The Pledgor will, from time to time upon
the request of the Administrative Agent, promptly deliver to the Administrative
Agent such stock powers, instruments, and similar documents, satisfactory in
form and substance to the Administrative Agent, with respect to the Collateral
as the Administrative Agent may reasonably request and will, from time to time
upon the request of the Administrative Agent after the occurrence of any Event
of Default, promptly transfer any Pledged Shares or other shares of common stock
constituting Collateral into the name of any nominee designated by the
Administrative Agent.
SECTION 4.3. Continuous Pledge. The Pledgor will, at all times, keep
pledged to the Administrative Agent pursuant hereto all Pledged Shares and all
other shares of capital stock constituting Collateral, all Dividends and
Distributions with respect thereto, all Pledged Notes, all interest, principal
and other proceeds received by the Administrative Agent with respect to the
Pledged Notes, and all other Collateral and other securities, instruments,
proceeds, and rights from time to time received by or distributable to the
Pledgor in respect of any Collateral and will not permit any Pledged Share
Issuer to issue any capital stock which shall not have been immediately duly
pledged hereunder on a first priority perfected basis. The Pledgor will not
amend the operating agreement for any Pledged Share Issuer that is a limited
liability company to permit that the membership interests of such Pledged Share
Issuer are governed by Article of the U.C.C. unless on or prior to the effective
date of such amendment the Administrative Agent shall have been given sole
"control" of such membership interests (as defined in Article 8 of the U.C.C.).
SECTION 4.4. Voting Rights; Dividends, etc. The Pledgor agrees:
(a) after any (i) Default of the nature referred to in Section
8.1.9 of the Credit Agreement shall have occurred and be continuing or
(ii) any other Event of Default shall have occurred and be continuing,
and the giving of notice from the Administrative Agent of its intent to
exercise its remedies (in the case of this clause (a)(ii)), the Pledgor
will deliver promptly upon receipt thereof (properly endorsed where
required hereby or requested by the Administrative Agent) to the
Administrative Agent all Dividends, Distributions, all interest, all
principal, all other cash payments, and all proceeds of the Collateral,
all of which shall be held by the Administrative Agent as additional
Collateral for use in accordance with Section 6.4; and
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(b) after any Event of Default shall have occurred and be
continuing and the Administrative Agent has notified the Pledgor of
the Administrative Agent's intention to exercise its voting power
under this Section 4.4(b)
(i) the Administrative Agent may exercise (to the
exclusion of the Pledgor) the voting power and all other
incidental rights of ownership with respect to any Pledged
Shares or other shares of capital stock constituting
Collateral and the Pledgor hereby grants the Administrative
Agent an irrevocable proxy, exercisable under such
circumstances, to vote the Pledged Shares and such other
Collateral; and
(ii) promptly to deliver to the Administrative Agent
such additional proxies and other documents as may be
necessary to allow the Administrative Agent to exercise such
voting power.
All Dividends, Distributions, interest, principal, cash payments, and proceeds
which may at any time and from time to time be held by the Pledgor but which the
Pledgor is then obligated to deliver to the Administrative Agent, shall, until
delivery to the Administrative Agent, be held by the Pledgor separate and apart
from its other property in trust for the Administrative Agent. The
Administrative Agent agrees that unless an Event of Default shall have occurred
and be continuing and the Administrative Agent shall have given the notice
referred to in Section 4.4(b), the Pledgor shall have the exclusive voting power
with respect to any shares of capital stock (including any of the Pledged
Shares) constituting Collateral and the Administrative Agent shall, upon the
written request of the Pledgor, promptly deliver such proxies and other
documents, if any, as shall be reasonably requested by the Pledgor which are
necessary to allow the Pledgor to exercise voting power with respect to any such
share of capital stock (including any of the Pledged Shares) constituting
Collateral; provided, however, that no vote shall be cast, or consent, waiver,
or ratification given, or action taken by the Pledgor that would violate or
consent to an action which could violate any provision of the Credit Agreement
or any other Loan Document (including this Pledge Agreement).
ARTICLE V
THE ADMINISTRATIVE AGENT
SECTION 5.1. Administrative Agent Appointed Attorney-in-Fact. The
Pledgor hereby irrevocably appoints the Administrative Agent the Pledgor's
attorney-in-fact, with full authority in the place and stead of the Pledgor or
otherwise, from
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time to time in the Administrative Agent's discretion, upon the occurrence and
during the continuance of an Event of Default and subject to delivery of notice
to the Pledgor to take any action and to execute any instrument which the
Administrative Agent may deem necessary or advisable to accomplish the purposes
of this Pledge Agreement, including without limitation:
(a) to ask, demand, collect, ▇▇▇ for, recover, compromise,
receive and give acquittance and receipts for moneys due and to become
due under or in respect of any of the Collateral;
(b) to receive, endorse, and collect any drafts or other
instruments, documents and chattel paper, in connection with clause (a)
above; and
(c) to file any claims or take any action or institute any
proceedings which the Administrative Agent may deem necessary or
desirable for the collection of any of the Collateral or otherwise to
enforce the rights of the Administrative Agent with respect to any of
the Collateral.
The Pledgor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section is irrevocable and coupled with an interest.
SECTION 5.2. Administrative Agent Has No Duty. The powers conferred on
the Administrative Agent hereunder are solely to protect its interest (on behalf
of the Lender Parties) in the Collateral and shall not impose any duty on it to
exercise any such powers. Except for reasonable care of any Collateral in its
possession and the accounting for moneys actually received by it hereunder, the
Administrative Agent shall have no duty as to any Collateral or responsibility
for (a) ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Pledged
Property, whether or not the Administrative Agent has or is deemed to have
knowledge of such matters, or (b) taking any necessary steps to preserve rights
against prior parties or any other rights pertaining to any Collateral.
SECTION 5.3. Reasonable Care. The Administrative Agent is required to
exercise reasonable care in the custody and preservation of any of the
Collateral in its possession; provided, however, the Administrative Agent shall
be deemed to have exercised reasonable care in the custody and preservation of
any of the Collateral, if it takes such action for that purpose as the Pledgor
reasonably requests in writing at times other than upon the occurrence and
during the continuance of any Event of
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Default, but failure of the Administrative Agent to comply with any such request
at any time shall not in itself be deemed a failure to exercise reasonable care.
ARTICLE VI
REMEDIES
SECTION 6.1. Certain Remedies. If any Event of Default shall have
occurred and be continuing:
(a) The Administrative Agent may exercise in respect of the
Collateral, in addition to other rights and remedies provided for
herein or otherwise available to it, all the rights and remedies of a
secured party on default under the U.C.C. (whether or not the U.C.C.
applies to the affected Collateral) and also may, without notice except
as specified below, sell the collateral or any part thereof in one or
more parcels at public or private sale, at any of the Administrative
Agent's offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as the Administrative Agent may
deem commercially reasonable. The Pledgor agrees that, to the extent
notice of sale shall be required by law, at least ten days' prior
notice to the Pledgor of the time and place of any public sale or the
time after which any private sale is to be made shall constitute
reasonable notification. The Administrative Agent shall not be
obligated to make any sale of Collateral regardless of notice of sale
having been given. The Administrative Agent may adjourn any public or
private sale from time to time by announcement at the time and place
fixed therefor, and such sale may, without further notice, be made at
the time and place to which it was so adjourned.
(b) The Administrative Agent may
(i) transfer all or any part of the Collateral into
the name of the Administrative Agent or its nominee, with or
without disclosing that such Collateral is subject to the lien
and security interest thereunder,
(ii) notify the parties obligated on any of the
Collateral to make payment to the Administrative Agent of any
amount due or to become due thereunder,
(iii) enforce collection of any of the Collateral by
suit or otherwise, and surrender, release or exchange all or
any part thereof,
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or compromise or extend or renew for any period (whether or
not longer than the original period) any obligations of any
nature of any party with respect thereto,
(iv) endorse any checks, drafts, or other writings in
the Pledgor's name to allow collection of the Collateral,
(v) take control of any proceeds of the Collateral,
and
(vi) execute (in the name, place and stead of the
Pledgor) endorsements, assignments, stock powers and other
instruments of conveyance or transfer with respect to all or
any of the Collateral.
SECTION 6.2. Securities Laws. If the Administrative Agent shall
determine to exercise its right to sell all or any of the Collateral pursuant to
Section 6.1, the Pledgor agrees that, upon request of the Administrative Agent,
the Pledgor will, at its own expense:
(a) execute and deliver, and cause each issuer of the
Collateral contemplated to be sold and the directors and officers
thereof to execute and deliver, all such instruments and documents, and
do or cause to be done all such other acts and things, as may be
necessary or, in the opinion of the Administrative Agent, advisable to
register such Collateral under the provisions of the Securities Act of
1933, as from time to time amended (the "Securities Act"), and to use
its best efforts to cause the registration statement relating thereto
to become effective and to remain effective for such period as
prospectuses are required by law to be furnished, and to make all
amendments and supplements thereto and to the related prospectus which,
in the opinion of the Administrative Agent, are necessary or advisable,
all in conformity with the requirements of the Securities Act and the
rules and regulations of the Securities and Exchange Commission
applicable thereto;
(b) use its best efforts to qualify the Collateral under the
state securities or "Blue Sky" laws and to obtain all necessary
governmental approvals for the sale of the Collateral, as requested by
the Administrative Agent;
(c) cause each such issuer to make available to its security
holders, as soon as practicable, an earnings statement that will
satisfy the provisions of Section 11(a) of the Securities Act; and
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(d) do or cause to be done all such other acts and things as
may be necessary to make such sale of the Collateral or any part
thereof valid and binding and in compliance with applicable law.
The Pledgor further acknowledges the impossibility of ascertaining the amount of
damages that would be suffered by the Administrative Agent or the Lender Parties
by reason of the failure by the Pledgor to perform any of the covenants
contained in this Section and, consequently, agrees that, if the Pledgor shall
fail to perform any of such covenants, it shall pay, as liquidated damages and
not as a penalty, an amount equal to the value (as determined by the
Administrative Agent) of the Collateral on the date the Administrative Agent
shall demand compliance with this Section.
SECTION 6.3. Compliance with Restrictions. The Pledgor agrees that in
any sale of any of the Collateral whenever an Event of Default shall have
occurred and be continuing, the Administrative Agent is hereby authorized to
comply with any limitation or restriction in connection with such sale as it may
be advised by counsel is necessary in order to avoid any violation of applicable
law (including compliance with such procedures as may restrict the number of
prospective bidders and purchasers, require that such prospective bidders and
purchasers have certain qualifications, and restrict such prospective bidders
and purchasers to persons who will represent and agree that they are purchasing
for their own account for investment and not with a view to the distribution or
resale of such Collateral), or in order to obtain any required approval of the
sale or of the purchaser by any governmental regulatory authority or official,
and the Pledgor further agrees that such compliance shall not result in such
sale being considered or deemed not to have been made in a commercially
reasonable manner, nor shall the Administrative Agent be liable nor account able
to the Pledgor for any discount allowed by the reason of the fact that such
Collateral is sold in compliance with any such limitation or restriction.
SECTION 6.4. Application of Proceeds. All cash proceeds received by the
Administrative Agent in respect of any sale of, collection from, or other
realization upon, all or any part of the Collateral may, in the discretion of
the Administrative Agent, be held by the Administrative Agent as additional
collateral security for, or then or at any time thereafter be applied (after
payment of any amounts payable to the Administrative Agent pursuant to Section
10.3 of the Credit Agreement and Section 6.5) in whole or in part by the
Administrative Agent against, all or any part of the Obligations as follows: (i)
first, to the reasonable out-of-pocket costs and expenses of the Administrative
Agent in connection with the retaking, holding, preparing for sale, selling or
other disposition of the Collateral, including, without limitation, all
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court costs and the reasonable fees and expenses of its agents and legal
counsel; (ii) second, to the payment in full of the Obligations or in the event
that such proceeds are insufficient to pay in full the Obligations, equally and
ratably in accordance with each Lender's respective amounts owing to it under or
pursuant to the Credit Agreement or any other Loan Document, or under or
pursuant to any Rate Protection Agreement (as to each Lender, applied first to
fees and expense reimbursements then due to such Lender, then to interest due to
such Lender, then to pay or prepay principal of the Loans owing to, or to reduce
the "credit exposure" of, such Lender under such Rate Protection Agreement, as
the case may be, then to pay (or cash collateralize) the remaining Obligations;
(iii) third, without duplication of any amounts paid pursuant to clause (ii)
above, to the Indemnified Parties to the extent of any amounts owing pursuant to
Section 10.4 of the Credit Agreement; and (iv) fourth, to the Pledgor, or its
successors and assigns, or as a court of competent jurisdiction may direct, of
any surplus then remaining. For purposes of this Agreement, the "credit
exposure" at any time of any Lender under a Rate Protection Agreement to which
such Lender is a party shall be determined at such time in accordance with the
customary methods of calculating credit exposure under similar arrangements by
the counterparty to such arrangements, taking into account potential interest
rate movements and the respective termination provisions and notional principal
amount and term of such Rate Protection Agreement. The Pledgor shall remain
liable to the Lenders for any deficiency. If the Administrative Agent has funds
available to apply to a portion of, but not all of, one of the amounts described
in clauses (i) through (iv) above, then the Administrative Agent shall apply
such funds to the applicable parties in proportion to the amounts to which such
parties would have been entitled if the entire amount described in any such
clause had been available.
SECTION 6.5. Indemnity and Expenses. The Pledgor hereby indemnifies and
holds harmless the Administrative Agent from and against any and all claims,
losses, and liabilities arising out of or resulting from this Pledge Agreement
(including enforcement of this Pledge Agreement), except claims, losses, or
liabilities resulting from the Administrative Agent's gross negligence or
willful misconduct. Upon demand, the Pledgor will pay to the Administrative
Agent the amount of any and all reasonable expenses, including the reasonable
fees and disbursements of its counsel and of any experts and agents, which the
Administrative Agent may incur in connection with:
(a) the administration of this Pledge Agreement, the Credit
Agreement and each other Loan Document;
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(b) the custody, preservation, use, or operation of, or the
sale of, collection from, or other realization upon, any of the
Collateral;
(c) the exercise or enforcement of any of the rights of the
Administrative Agent hereunder; or
(d) the failure by the Pledgor to perform or observe any of
the provisions hereof.
ARTICLE VII
MISCELLANEOUS PROVISIONS
SECTION 7.1. Loan Document. This Pledge Agreement is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof.
SECTION 7.2. Amendments, etc. No amendment to or waiver of any
provision of this Pledge Agreement nor consent to any departure by the Pledgor
herefrom shall in any event be effective unless the same shall be in writing and
signed by the Administrative Agent (on behalf of the Lenders or the Required
Lenders, as the case may be), and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which it is
given.
SECTION 7.3. Protection of Collateral The Administrative Agent may from
time to time, at its option, perform any act which the Pledgor agrees hereunder
to perform and which the Pledgor shall fail to perform within 30 days after
being requested in writing so to perform and during the continuance of an Event
of Default the Administrative Agent may from time to time take any other action
which the Administrative Agent reasonably deems necessary for the maintenance,
preservation or protection of any of the Collateral or of its security interest
therein.
SECTION 7.4. Addresses for Notices All notices and other communications
provided to the Pledgor under this Pledge Agreement shall be in writing or by
facsimile and addressed, delivered or transmitted to the Pledgor at its address
or facsimile number as set forth in the Credit Agreement or at such other
address or facsimile number as may be designated by the Pledgor in a notice to
the other parties. Any notice, if mailed and properly addressed with postage
prepaid or if properly addressed and sent by pre-paid courier service, shall be
deemed given when received; any notice, if transmitted by facsimile, shall be
deemed given when transmitted.
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SECTION 7.5. Section Captions Section captions used in this Pledge
Agreement are for convenience of reference only, and shall not affect the
construction of this Pledge Agreement.
SECTION 7.6. Severability Wherever possible each provision of this
Pledge Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Pledge Agreement shall
be prohibited by or invalid under such law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Pledge
Agreement.
SECTION 7.7. Governing Law, Entire Agreement, etc. THIS PLEDGE
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT THE VALIDITY OR
PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT
OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER
THAN THE STATE OF NEW YORK. THIS PLEDGE AGREEMENT AND THE OTHER LOAN DOCUMENTS
CONSTITUTE THE ENTIRE UNDERSTANDING AMONG THE PARTIES HERETO WITH RESPECT TO THE
SUBJECT MATTER HEREOF AND SUPERSEDE ANY PRIOR AGREEMENTS, WRITTEN OR ORAL, WITH
RESPECT THERETO.
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IN WITNESS WHEREOF, the parties hereto have caused this Pledge
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the day and year first above written.
NEW WORLD PASTA COMPANY
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President, Finance,
and Chief Financial Officer
THE BANK OF NOVA SCOTIA,
as Administrative Agent
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Senior Relationships
Manager
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