EXHIBIT 10.13
SUBSIDIARY PLEDGE AGREEMENT
AMENDMENT AND RESTATEMENT dated as of September 20, 1996 to PLEDGE
AGREEMENT, dated as of August 1, 1995 (as amended, modified or supplemented from
time to time, the "Agreement"), made by each of the undersigned (each a
"Pledgor" and collectively, the "Pledgors"), in favor of THE CHASE MANHATTAN
BANK, as Collateral Agent (the "Pledgee"), for the benefit of the Secured
Creditors (as defined below). Except as otherwise defined herein, terms used
herein and defined in the Credit Agreement (as defined below) shall be used
herein as therein defined.
W I T N E S S E T H :
WHEREAS, RELTEC HOLDINGS, INC. and RELTEC (UK) LIMITED (each a
"Borrower" and collectively, the "Borrowers"), various financial institutions
from time to time party thereto (the "Banks"), and The Chase Manhattan Bank, as
Agent (the "Agent", and together with the Banks, the "Bank Creditors"), have
entered into an Amendment and Restatement dated as of September 20, 1996,
amending and restating the Credit Agreement dated as of July 31, 1995 (as
amended, modified or supplemented from time to time, the "Credit Agreement"),
providing for the making of Loans and the issuance of, and participation in,
Letters of Credit as contemplated therein;
WHEREAS, the Company may from time to time be a party to one or more
Interest Rate Agreements (each such Interest Rate Agreement with an Interest
Rate Creditor (as defined below), a "Secured Interest Rate Agreement") with any
Bank (including without limitation The Chase Manhattan Bank in its individual
capacity) or a syndicate of financial institutions organized by any Bank or an
affiliate of any Bank (even if any such Bank ceases to be a Bank under the
Credit Agreement for any reason) (any institution that participates in such
Secured Interest Rate Agreement, and in each case, its assignees, collectively,
the "Interest Rate Creditors," and the Interest Rate Creditors together with the
Bank Creditors, collectively the "Secured Creditors");
WHEREAS, the Pledgors entered into a Pledge Agreement, dated as of
August 1, 1995 (as amended, modified or supplemented to the date hereof, the
"Original Pledge Agreement");
WHEREAS, each Pledgor desires to amend and restate the Original Pledge
Agreement;
NOW, THEREFORE, the parties hereto agree that the Original Pledge
Agreement shall be and is hereby amended and restated in its entirety to read as
follows:
1. SECURITY FOR OBLIGATIONS. This Agreement is made by each Pledgor
for the benefit of the Secured Creditors to secure:
(i) the full and prompt payment when due of all obligations and
liabilities of such Pledgor, now existing or hereafter incurred under,
arising out of or in connection with the Subsidiary Guaranty or any Credit
Document and the due performance and compliance by such Pledgor with the
terms of each such Credit Document (all such obligations and liabilities
under this clause (i), except to the extent consisting of obligations or
indebtedness with respect to Interest Rate Agreements, being herein
collectively called the "Credit Document Obligations");
(ii) the full and prompt payment when due (whether at the stated
maturity, by acceleration or otherwise) of all obligations and liabilities
of such Pledgor, now existing or hereafter incurred under, arising out of
or in connection with any Secured Interest Rate Agreement including all
obligations under the Subsidiary Guaranty in respect of Interest Rate
Agreements (all such obligations and indebtedness under this clause (ii)
being herein collectively called the "Interest Rate Obligations");
(iii) any and all sums advanced by the Pledgee in order to
preserve the Collateral (as hereinafter defined) or preserve its security
interest in the Collateral (as hereinafter defined); and
(iv) in the event of any proceeding for the collection or enforcement
of any indebtedness, obligations, or liabilities referred to in clauses
(i), (ii) and (iii) above, after an Event of Default (such term, as used in
this Agreement, shall mean any Event of Default under, and as defined in,
the Credit Agreement or any payment default under any Secured Interest Rate
Agreement after the expiration of any applicable grace period) shall have
occurred and be continuing, the reasonable expenses of retaking, holding,
preparing for sale or lease, selling or otherwise disposing or realizing on
the Collateral, or of any exercise by the Pledgee of its rights hereunder,
together with reasonable attorneys' fees and court costs;
all such obligations, liabilities, sums and expenses set forth in clauses (i)
through (iv) of this Section 1 being herein collectively called the
"Obligations".
2. DEFINITION OF STOCK, NOTES, SECURITIES, ETC. As used herein, (i)
the term "Stock" shall mean (x) with respect to Domestic Subsidiaries, all of
the issued and outstanding shares of capital stock at any time owned by any
Pledgor of any Domestic Subsidiary other than an Unrestricted Subsidiary, and
(y) with respect to Foreign Subsidiaries, all of the issued and outstanding
shares of capital stock at any time owned by any Pledgor of
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any Foreign Subsidiary, PROVIDED that such Pledgor shall not be required to
pledge hereunder (and the term "Stock" shall not include) more than 65% of the
total combined voting power of all classes of capital stock of any Foreign
Subsidiary entitled to vote; (ii) the term "Notes" shall mean all promissory
notes from time to time issued to, or held by, any Pledgor; and (iii) the term
"Securities" shall mean all of the Stock and Notes. Each Pledgor represents and
warrants that on the date hereof: (a) each Subsidiary of such Pledgor, and the
direct ownership thereof, is listed on Annex A hereto; (b) the Stock held by
such Pledgor consists of the number and type of shares of the stock of the
corporations as described in Annex B hereto; (c) such Pledgor is the holder of
record with respect to each Subsidiary and sole beneficial owner of such Stock;
(d) such Stock constitutes that percentage of the issued and outstanding capital
stock of the issuing corporation as is set forth in Annex B hereto; (e) the
Notes held by such Pledgor consist of the promissory notes described in Annex C
hereto; and (f) on the date hereof, such Pledgor owns or possesses no other
Securities.
3. PLEDGE OF SECURITIES, ETC.
3.1. PLEDGE. To secure the Obligations and for the purposes set
forth in Section 1, each Pledgor hereby: (i) grants to the Pledgee a security
interest in all of the Collateral (as hereinafter defined) owned by such
Pledgor; (ii) pledges and deposits as security with the Pledgee all Securities
owned by such Pledgor on the date hereof, if any, and delivers to the Pledgee
certificates or instruments therefor, duly endorsed in blank in the case of
Notes and accompanied by undated stock powers duly executed in blank by such
Pledgor in the case of Stock, or such other instruments of transfer as are
acceptable to the Pledgee; and (iii) assigns, transfers, hypothecates,
mortgages, charges and sets over to the Pledgee all of such Pledgor's right,
title and interest in and to such Securities (and in and to all certificates or
instruments evidencing such Securities), to be held by the Pledgee, upon the
terms and conditions set forth in this Agreement.
3.2. SUBSEQUENTLY ACQUIRED CERTIFIED STOCK. If a Pledgor shall
acquire (by purchase, stock dividend or otherwise) any additional Securities at
any time or from time to time after the date hereof which are represented by
certificates or instruments, such Pledgor will forthwith pledge and deposit the
certificates or instruments representing such Securities as security with the
Pledgee and deliver to the Pledgee the certificates or instruments therefor,
duly endorsed in blank in the case of Notes and accompanied by undated stock
powers duly executed in blank in the case of Stock, or such other instruments of
transfer as are acceptable to the Pledgee, and will promptly thereafter deliver
to the Pledgee a certificate executed by a principal executive officer of such
Pledgor describing such Securities and certifying that the same have been duly
pledged with the Pledgee hereunder. No Pledgor shall be required at any time to
pledge hereunder any Stock which is more than 65% of the total combined voting
power of all classes of capital stock of any Foreign Corporation entitled to
vote.
3.3. UNCERTIFICATED SECURITIES. Notwithstanding anything to the
contrary contained in Sections 3.1 and 3.2, if any Securities (whether or not
now owned or hereafter acquired) are uncertificated securities, the relevant
Pledgor shall promptly notify the Pledgee
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thereof, and shall promptly take all actions required to perfect the security
interest of the Pledgee under applicable law (including, in any event, under
Sections 8-313 and 8-321 of the New York Uniform Commercial Code, if
applicable). Each Pledgor further agrees to take such actions as the Pledgee
deems necessary or desirable to effect the foregoing and to permit the Pledgee
to exercise any of its rights and remedies hereunder, and agrees to provide an
opinion of counsel reasonably satisfactory to the Pledgee with respect to any
such pledge of uncertificated Securities promptly upon request of the Pledgee.
3.4. DEFINITION OF PLEDGED STOCK, PLEDGED NOTES, PLEDGED SECURITIES
AND COLLATERAL. All Stock at any time pledged or required to be pledged
hereunder is hereinafter called the "Pledged Stock"; all Notes at any time
pledged or required to be pledged hereunder are hereinafter called the "Pledged
Notes"; all Pledged Stock and Pledged Notes together are called the "Pledged
Securities"; and the Pledged Securities, together with all proceeds thereof,
including any securities and moneys received and at the time held by the Pledgee
hereunder, are hereinafter called the "Collateral".
4. APPOINTMENT OF SUB-AGENTS; ENDORSEMENTS, ETC. The Pledgee shall
have the right, at its own expense or if an Event of Default exists, at the
expense of each Pledgor, to appoint one or more sub-agents for the purpose of
retaining physical possession of the Pledged Securities, which may be held (in
the discretion of the Pledgee) in the name of the relevant Pledgor, endorsed or
assigned in blank or in favor of the Pledgee or any nominee or nominees of the
Pledgee or a sub-agent appointed by the Pledgee.
5. VOTING, ETC., WHILE NO EVENT OF DEFAULT. Unless and until an
Event of Default has occurred and be continuing and the Pledgee shall have
notified the relevant Pledgor that such Pledgor may no longer exercise the
rights referred to below (except that no such notice shall be required in the
case of an Event of Default specified in Section 9.05 of the Credit Agreement
with respect to such Pledgor (a "Bankruptcy Event of Default")), such Pledgor
shall be entitled to exercise any and all voting and other consensual rights
pertaining to the Pledged Securities owned by it, and to give consents, waivers
or ratifications in respect thereof, PROVIDED that no vote shall be cast or any
consent, waiver or ratification given or any action taken which would violate or
be inconsistent with any of the terms of any Credit Document or any Secured
Interest Rate Agreement (collectively, the "Secured Debt Agreement"), or which
would have the effect of impairing the position or interests of the Pledgee or
any Secured Creditor therein. All such rights of the relevant Pledgor to vote
and to give consents, waivers and ratifications shall cease in case an Event of
Default shall occur and be continuing and, except in the case of a Bankruptcy
Event of Default with respect to such Pledgor, the Pledgee shall have notified
such Pledgor of such cessation, and Section 7 hereof shall become applicable.
6. DIVIDENDS AND OTHER DISTRIBUTIONS. Unless and until an Event of
Default shall have occurred and be continuing, all cash dividends payable in
respect of the Pledged Securities shall be paid to the relevant Pledgor,
PROVIDED that, all dividends payable in respect of the Pledged Stock which are
determined by the Pledgee, in its reasonable
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discretion, to represent in whole or in part, a liquidating or other
distribution in return of capital shall be paid to the Pledgee and retained by
it as part of the Collateral (unless such dividends are applied to repay
Obligations pursuant to Section 9). The Pledgee shall also be entitled to
receive directly in pledge, and to retain as part of the Collateral:
(i) all other or additional stock or other securities or property
(other than cash) paid or distributed by way of dividend or otherwise in
respect of the Pledged Stock;
(ii) all other or additional stock or other securities or property
(including cash (unless such dividends are applied to repay Obligations
pursuant to Section 9)) paid or distributed in respect of the Pledged Stock
by way of stock-split, spin-off, split-up, reclassification, combination of
shares or similar rearrangement; and
(iii) all other or additional stock or other securities or
property (including cash (unless such dividends are applied to repay the
Obligations pursuant to Section 9)) which may be paid in respect of the
Collateral by reason of any consolidation, merger, exchange of stock,
conveyance of assets, liquidation or similar corporate reorganization.
All dividends, distributions or other payments which are received by any Pledgor
contrary to the provisions of this Section 6 or Section 7 shall be received in
trust for the benefit of the Pledgee, shall be segregated from other property or
funds of such Pledgor and shall be forthwith paid over to the Pledgee as
Collateral in the same form as so received (with any necessary endorsement).
7. REMEDIES IN CASE OF EVENT OF DEFAULT. In case an Event of Default
shall have occurred and be continuing, the Pledgee shall be entitled to exercise
all of the rights, powers and remedies (whether vested in it by this Agreement
or by any other Secured Debt Agreement or by law) for the protection and
enforcement of its rights in respect of the Collateral, including, without
limitation, all the rights and remedies of a secured party upon default under
the Uniform Commercial Code of the State of New York, and the Pledgee shall be
entitled, without limitation, to exercise the following rights, which each
Pledgor hereby agrees to be commercially reasonable:
(i) to receive all amounts payable in respect of the Collateral
payable to such Pledgor under Section 6;
(ii) to transfer all or any part of the Collateral into the Pledgee's
name or the name of its nominee or nominees;
(iii) to accelerate any Pledged Note which may be accelerated in
accordance with its terms, and take any other action to collect upon any
Pledged Note (including, without limitation, to make any demand for payment
thereon);
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(iv) subject to the notice requirements set forth in Section 5, to
vote all or any part of the Pledged Securities (whether or not transferred
into the name of the Pledgee) and give all consents, waivers and
ratifications in respect of the Collateral and otherwise act with respect
thereto as though it were the outright owner thereof (each Pledgor hereby
irrevocably constituting and appointing the Pledgee the proxy and
attorney-in-fact of such Pledgor, with full power of substitution to do
so); and
(v) at any time or from time to time to sell, assign and deliver, or
grant options to purchase, all or any part of the Collateral, or any
interest therein, at any public or private sale, without demand of
performance, advertisement or notice of intention to sell or of the time or
place of sale or adjournment thereof or to redeem or otherwise (all of
which are hereby waived by each Pledgor), for cash, on credit or for other
property, for immediate or future delivery without any assumption of credit
risk, and for such price or prices and on such terms as the Pledgee in its
absolute discretion may determine, PROVIDED that at least 10 days' notice
of the time and place of any such sale shall be given to the relevant
Pledgor. Each purchaser at any such sale shall hold the property so sold
absolutely free from any claim or right on the part of any Pledgor, and
each Pledgor hereby waives and releases to the fullest extent permitted by
law any right or equity of redemption with respect to the Collateral,
whether before or after sale hereunder, and all rights, if any, of
marshalling the Collateral and any other security for the Obligations or
otherwise. At any such sale, unless prohibited by applicable law, the
Pledgee on behalf of the Secured Creditors may bid for and purchase all or
any part of the Collateral so sold free from any such right or equity of
redemption. Neither the Pledgee nor any Secured Creditor shall be liable
for failure to collect or realize upon any or all of the Collateral or for
any delay in so doing nor shall any of them be under any obligation to take
any action whatsoever with regard thereto.
8. REMEDIES, ETC., CUMULATIVE. Each right, power and remedy of the
Pledgee provided for in this Agreement or any other Secured Debt Agreement or
now or hereafter existing at law or in equity or by statute shall be cumulative
and concurrent and shall be in addition to every other such right, power or
remedy. The exercise or beginning of the exercise by the Pledgee or any Secured
Creditor of any one or more of the rights, powers or remedies provided for in
this Agreement or any other Secured Debt Agreement or now or hereafter existing
at law or in equity or by statute or otherwise shall not preclude the
simultaneous or later exercise by the Pledgee or any Secured Creditor of all
such other rights, powers or remedies, and no failure or delay on the part of
the Pledgee or any Secured Creditor to exercise any such right, power or remedy
shall operate as a waiver thereof.
9. APPLICATION OF PROCEEDS. (a) All moneys collected by the Pledgee
upon any sale or other disposition of the Collateral pursuant to the terms of
this Agreement, together with all other moneys received by the Pledgee
hereunder, shall be applied as follows:
(i) first, to the payment of all Obligations owing to the Pledgee of
the type described in clauses (ii), (iii) and (iv) of Section 1 of this
Agreement;
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(ii) second, to the extent moneys remain after the application
pursuant to the preceding clause (i), an amount equal to the outstanding
Obligations shall be paid to the Secured Creditors as provided in Section
9(c) with each Secured Creditor receiving an amount equal to its
outstanding Obligations or, if the moneys are insufficient to pay in full
all such Obligations, its Pro Rata Share (as defined below) of the amount
remaining to be distributed; and
(iii) third, to the extent moneys remain after the application
pursuant to the preceding clauses (i) and (ii) and following the
termination of this Agreement pursuant to Section 18 hereof, to the Pledgor
or to whomever may be lawfully entitled to receive such surplus.
(b) For purposes of this Agreement "Pro Rata Share" shall mean, when
calculating a Secured Creditor's portion of any distribution or amount, the
amount (expressed as a percentage) equal to a fraction the numerator of which is
the amount of such Secured Creditor's Obligations and the denominator of which
is the then outstanding amount of all Obligations.
(c) All payments required to be made to the (i) Bank Creditors
hereunder shall be made to the Agent under the Credit Agreement for the account
of the Bank Creditors and (ii) Interest Rate Creditors hereunder shall be made
to the paying agent under the applicable Secured Interest Rate Agreement or, in
the case of Secured Interest Rate Agreements without a paying agent, directly to
the applicable Interest Rate Creditor.
(d) For purposes of applying payments received in accordance with
this Section 9, the Pledgee shall be entitled to rely upon (i) the Agent under
the Credit Agreement in respect of Credit Document Obligations for a
determination (which the Agent and each Bank Creditor agree (or shall agree) to
provide upon request of the Pledgee) as to the outstanding Obligations owed to
the Bank Creditors and (ii) upon any Interest Rate Creditor for a determination
(which each Interest Rate Creditor agrees to provide upon request to the
Pledgee) of the outstanding Interest Rate Obligations owed to such Interest Rate
Creditor. Unless it has actual knowledge (including by way of written notice
from a Secured Creditor) to the contrary, the Agent under the Credit Agreement
in furnishing information pursuant to the preceding sentence, and the Pledgee in
acting hereunder, shall be entitled to assume that (x) no Credit Document
Obligations other than principal, interest and regularly accruing fees are owing
to any Bank Creditor and (y) no Secured Interest Rate Agreements or Interest
Rate Obligations with respect thereto are in existence.
(e) It is understood and agreed that the Pledgors shall remain
jointly and severally liable to the extent of any deficiency between (x) the
amount of the proceeds of the Collateral hereunder and (y) the aggregate
outstanding amount of the Obligations.
10. PURCHASERS OF COLLATERAL. Upon any sale of the Collateral by the
Pledgee hereunder (whether by virtue of the power of sale herein granted,
pursuant to
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judicial process or otherwise), the receipt of the Pledgee or 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
Pledgee or such officer or be answerable in any way for the misapplication or
nonapplication thereof.
11. INDEMNITY. The Pledgors jointly and severally agree (i) to
indemnify and hold harmless the Pledgee and the Secured Creditors in such
capacity from and against any and all claims, demands, losses, judgments and
liabilities (including liabilities for penalties) of whatsoever kind or nature,
and (ii) to reimburse the Pledgee and the Secured Creditors for all reasonable
costs and expenses, including reasonable attorneys' fees growing out of or
resulting from this Agreement or the exercise by the Pledgee of any right or
remedy granted to it hereunder or under any other Secured Debt Agreement except,
with respect to clauses (i) and (ii) above, for those arising from the Pledgee's
gross negligence or willful misconduct. In no event shall the Pledgee be
liable, in the absence of gross negligence or willful misconduct on its part,
for any matter or thing in connection with this Agreement other than to account
for moneys actually received by it in accordance with the terms hereof. If and
to the extent that the obligations of a Pledgor under this Section 11 are
unenforceable for any reason, such Pledgor hereby agrees to make the maximum
contribution to the payment and satisfaction of such obligations which is
permissible under applicable law.
12. FURTHER ASSURANCES; POWER OF ATTORNEY. (a) Each Pledgor agrees
that it will join with the Pledgee in executing and, at such Pledgor's own
expense, file and refile under the UCC such financing statements, continuation
statements and other documents in such offices as the Pledgee may deem necessary
or appropriate and wherever required or permitted by law in order to perfect and
preserve the Pledgee's security interest in the Collateral and hereby authorizes
the Pledgee to file financing statements and amendments thereto relative to all
or any part of the Collateral without the signature of such Pledgor where
permitted by law, and agrees to do such further acts and things and to execute
and deliver to the Pledgee such additional conveyances, assignments, agreements
and instruments as the Pledgee may reasonably require or deem advisable to carry
into effect the purposes of this Agreement or to further assure and confirm unto
the Pledgee its rights, powers and remedies hereunder.
(b) Each Pledgor hereby appoints the Pledgee such Pledgor's
attorney-in-fact, with full authority in the place and stead of such Pledgor and
in the name of such Pledgor or otherwise, from time to time after the occurrence
and during the continuance of an Event of Default, in the Pledgee's discretion
to take any action and to execute any instrument which the Pledgee may
reasonably deem necessary or advisable to accomplish the purpose of this
Agreement.
13. THE PLEDGEE AS AGENT. The Pledgee will hold in accordance with
this Agreement all items of the Collateral at any time received under this
Agreement. It is expressly understood and agreed that the obligations of the
Pledgee as holder of the Collateral
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and interests therein and with respect to the disposition thereof, and otherwise
under this Agreement, are only those expressly set forth in this Agreement. The
Pledgee shall act hereunder on the terms and conditions set forth herein and in
Section 11 of the Credit Agreement.
14. TRANSFER BY PLEDGORS. Except for sales of Collateral permitted
pursuant to the Credit Agreement, no Pledgor will sell or otherwise dispose of,
grant any option with respect to, or mortgage, pledge or otherwise encumber any
of the Collateral or any interest therein (except in accordance with the terms
of this Agreement).
15. REPRESENTATIONS, WARRANTIES AND COVENANTS OF PLEDGORS. (a) Each
Pledgor represents, warrants and covenants that:
(i) it is the legal, record and beneficial owner of, and has good and
marketable title to, all Securities pledged by it hereunder, subject to no
pledge, lien, mortgage, hypothecation, security interest, charge, option or
other encumbrance whatsoever, except the liens and security interests
created by this Agreement;
(ii) it has full power, authority and legal right to pledge all the
Securities pledged by it pursuant to this Agreement;
(iii) all the shares of Stock have been duly and validly issued
and are fully paid and nonassessable; and
(iv) each of the Notes, when executed by the obligor thereof, will be
the legal, valid and binding obligation of such obligor, enforceable in
accordance with its terms, except to the extent that the enforceability
thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws generally affecting creditors'
rights and by equitable principles (regardless of whether enforcement is
sought in equity or at law).
(b) Each Pledgor covenants and agrees that it will defend the
Pledgee's right, title and security interest in and to the Securities and the
proceeds thereof against the claims and demands of all persons whomsoever.
(c) Each Pledgor further covenants and agrees that it will have like
title to and right to pledge any other property at any time hereafter pledged to
the Pledgee as Collateral hereunder and will likewise defend the right thereto
and security interest therein of the Pledgee and the Secured Creditors.
16. PLEDGORS' OBLIGATIONS ABSOLUTE, ETC. The obligations of each
Pledgor under this Agreement shall be absolute and unconditional and shall
remain in full force and effect without regard to, and shall not be released,
suspended, discharged, terminated
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or otherwise affected by, any circumstance or occurrence whatsoever, including,
without limitation:
(i) any renewal, extension, amendment or modification of or addition
or supplement to or deletion from any Credit Document or any other
instrument or agreement referred to therein, or any assignment or transfer
of any thereof;
(ii) any waiver, consent, extension, indulgence or other action or
inaction under or in respect of any such agreement or instrument or this
Agreement;
(iii) any furnishing of any additional security to the Pledgee or
its assignee or any acceptance thereof or any release of any security by
the Pledgee or its assignee;
(iv) any limitation on any party's liability or obligations under any
such instrument or agreement or any invalidity or unenforceability, in
whole or in part, of any such instrument or agreement or any term thereof;
or
(v) any bankruptcy, insolvency, reorganization, composition,
adjustment, dissolution, liquidation or other like proceeding relating to
such Pledgor or any Subsidiary of such Pledgor, or any action taken with
respect to this Agreement by any trustee or receiver, or by any court, in
any such proceeding, whether or not such Pledgor shall have notice or
knowledge of any of the foregoing.
17. REGISTRATION, ETC. (a) If an Event of Default shall have
occurred and be continuing and a Pledgor shall have received from the Pledgee a
written request or requests that such Pledgor cause any registration,
qualification or compliance under any Federal or state securities law or laws to
be effected with respect to all or any part of the Pledged Stock, such Pledgor
as soon as practicable and at its expense will use its reasonable efforts to
cause such registration to be effected (and be kept effective) and will use its
reasonable efforts to cause such qualification and compliance to be effected
(and be kept effective) as may be so requested and as would permit or facilitate
the sale and distribution of such Pledged Stock, including, without limitation,
registration under the Securities Act of 1933 as then in effect (or any similar
statute then in effect), appropriate qualifications under applicable blue sky or
other state securities laws and appropriate compliance with any other government
requirements, PROVIDED that the Pledgee shall furnish to such Pledgor such
information regarding the Pledgee as the relevant Pledgor may request in writing
and as shall be required in connection with any such registration, qualification
or compliance. Each Pledgor will cause the Pledgee to be kept reasonably
advised in writing as to the progress of each such registration, qualification
or compliance and as to the completion thereof, will furnish to the Pledgee such
number of prospectuses, offering circulars or other documents incident thereto
as the Pledgee from time to time may reasonably request, and will indemnify the
Pledgee and all others participating in the distribution of the Pledged Stock
against all claims, losses, damages and liabilities caused by any untrue
statement (or alleged untrue statement) of a material fact contained therein (or
in any related registration statement, notification or the
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like) or by any omission (or alleged omission) to state therein (or in any
related registration statement, notification or the like) a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as the same may have been caused by an untrue
statement or omission based upon information furnished in writing to the
relevant Pledgor by or on behalf of the Pledgee expressly for use therein.
(b) If at any time when the Pledgee shall determine to exercise its
right to sell all or any part of the Pledged Stock pursuant to Section 7, such
Pledged Stock or the part thereof to be sold shall not, for any reason
whatsoever, be effectively registered under the Securities Act of 1933, as then
in effect, the Pledgee may, in its sole and absolute discretion, sell such
Pledged Stock or part thereof by private sale in such manner and under such
circumstances as the Pledgee may deem necessary or advisable in order that such
sale may legally be effected without such registration, PROVIDED that at least
10 days' notice of the time and place of any such sale shall be given to the
relevant Pledgor. Without limiting the generality of the foregoing, in any such
event the Pledgee, in its sole and absolute discretion: (i) may proceed to make
such private sale notwithstanding that a registration statement for the purpose
of registering such Pledged Stock or part thereof shall have been filed under
such Securities Act; (ii) may approach and negotiate with a single possible
purchaser to effect such sale; and (iii) may restrict such sale to a purchaser
who will represent and agree that such purchaser is purchasing for its own
account, for investment, and not with a view to the distribution or sale of such
Pledged Stock or part thereof. In the event of any such sale, the Pledgee shall
incur no responsibility or liability for selling all or any part of the Pledged
Stock at a price which the Pledgee, in its sole and absolute discretion, may in
good ▇▇▇▇▇ ▇▇▇▇ reasonable under the circumstances.
18. TERMINATION, RELEASE. (a) After the Termination Date (as
defined below), this Agreement shall terminate (provided that all indemnities
set forth herein including, without limitation, in Section 11 hereof shall
survive any such termination) and the Pledgee, at the request and expense of the
relevant Pledgor, will promptly execute and deliver to the relevant Pledgor a
proper instrument or instruments acknowledging the satisfaction and termination
of this Agreement, and will duly assign, transfer and deliver to the relevant
Pledgor (without recourse and without any representation or warranty) such of
the Collateral as may be in the possession of the Pledgee and as has not
theretofore been sold or otherwise applied or released pursuant to this
Agreement. As used in this Agreement, "Termination Date" shall mean the date
upon which the Total Commitment and all Secured Interest Rate Agreements have
been terminated, no Letter of Credit or Note (as defined in the Credit
Agreement) is outstanding and all Obligations have been paid in full.
(b) In the event that any part of the Collateral is sold in
connection with a sale permitted by Section 8.02 of the Credit Agreement or is
otherwise released at the direction of the Required Banks (or as otherwise
required by Section 13.12 of the Credit Agreement), and the proceeds of such
sale or sales or from such release are applied in accordance with the terms of
the Credit Agreement to the extent required to be so applied, the Pledgee, at
the request and expense of the relevant Pledgor, will duly assign, transfer and
deliver to the relevant Pledgor
11
(without recourse and without any representation or warranty) such of the
Collateral as is then being (or has been) so sold or released and as may be in
possession of the Pledgee and has not theretofore been released pursuant to this
Agreement.
(c) At any time that the relevant Pledgor desires that Collateral be
released as provided in the foregoing Section 18(a) or (b), it shall deliver to
the Pledgee a certificate signed by its chief financial officer or another
authorized senior officer stating that the release of the respective Collateral
is permitted pursuant to Section 18(a) or (b). The Pledgee shall have no
liability whatsoever to any Secured Creditor as a result of any release of
Collateral by it as permitted by this Section 18.
19. NOTICES, ETC. All notices and other communications hereunder
shall be in writing and shall be delivered or mailed by first class mail,
postage prepaid, addressed:
(a) if to a Pledgor, at its address set forth opposite its signature
below;
(b) if to the Pledgee, at:
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇;
(c) if to any Bank (other than the Pledgee), at such address as such
Bank shall have specified in the Credit Agreement;
(d) if to any Interest Rate Creditor, at such address as such
Interest Rate Creditor shall have specified in writing to the Pledgors and
the Pledgee;
or at such other address as shall have been furnished in writing by any Person
described above to the party required to give notice hereunder.
20. WAIVER; AMENDMENT. None of the terms and conditions of this
Agreement may be changed, waived, modified or varied in any manner whatsoever
unless in writing duly signed by each Pledgor and the Pledgee (with the written
consent of the Required Banks (or as otherwise required by Section 13.12 of the
Credit Agreement)); PROVIDED, HOWEVER, that no such change, waiver, modification
or variance shall be made to Section 9 hereof or this Section 20 without the
consent of each Secured Creditor adversely affected thereby, PROVIDED FURTHER,
that any change, waiver, modification or variance adversely affecting the rights
and benefits of a single Class of Secured Creditors (and not all Secured
Creditors in a like or similar manner) shall require the written consent of the
Requisite Creditors of such Class of Secured Creditors. For the purpose of this
Agreement, the term
12
"Class" shall mean each class of Secured Creditors, I.E., whether (x) the Bank
Creditors as holders of the Credit Document Obligations or (y) the Interest Rate
Creditors as holders of the Interest Rate Obligations. For the purpose of this
Agreement, the term "Requisite Creditors" of any Class shall mean each of (x)
with respect to each of the Credit Document Obligations, the Required Banks and
(y) with respect to the Interest Rate Obligations, the holders of at least a
majority of all obligations outstanding from time to time under the Secured
Interest Rate Agreements.
21. MISCELLANEOUS. This Agreement shall create a continuing security
interest in the Collateral and shall (a) remain in full force and effect,
subject to release and/or termination as set forth in Section 18, (b) be binding
upon each Pledgor, its successors and assigns, PROVIDED HOWEVER that no Pledgor
shall assign any of its rights or obligations hereunder without the prior
written consent of the Pledgee (with the prior written consent of the Required
Banks or as otherwise required by Section 13.12 of the Credit Agreement), and
(c) inure, together with the rights and remedies of the Pledgee hereunder, to
the benefit of the Pledgee, the Secured Creditors and their respective
successors, transferees and assigns. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. The headings
of the several sections and subsections in this Agreement are for purposes of
reference only and shall not limit or define the meaning hereof. This Agreement
may be executed in any number of counterparts, each of which shall be an
original, but all of which together shall constitute one instrument. In the
event that any provision of this Agreement shall prove to be invalid or
unenforceable, such provision shall be deemed to be severable from the other
provisions of this Agreement which shall remain binding on all parties hereto.
22. WAIVER OF JURY TRIAL. Each Pledgor and the Pledgee hereby
irrevocably waive all right to a trial by jury in any action, proceeding or
counterclaim arising out of or relating to this Agreement or the transactions
contemplated hereby.
23. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Company and the
Agent.
24. ADDITIONAL PLEDGORS. It is understood and agreed that any
Subsidiary of the Company that is required to execute a counterpart of this
Agreement pursuant to the Credit Agreement shall automatically become a Pledgor
hereunder by executing a counterpart hereof and delivering the same to the
Agent.
* * *
13
IN WITNESS WHEREOF, each Pledgor and the Pledgee have caused this
Agreement to be executed by their duly elected officers duly authorized as of
the date first above written.
Address:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ RELTEC CORPORATION,
Suite 250 as Pledgor
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone No.:(▇▇▇) ▇▇▇-▇▇▇▇ By:________________________
Facsimile No.: (▇▇▇)▇▇▇-▇▇▇▇ Title: Vice President
c/o RELTEC Holdings, Inc. RELTEC FOREIGN HOLDINGS, INC.,
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ as Pledgor
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ By:________________________
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ Title:
THE CHASE MANHATTAN BANK,
as Pledgee
By:________________________
Title:
14
ANNEX A
to
SUBSIDIARY PLEDGE AGREEMENT
LIST OF SUBSIDIARIES
Jurisdiction
PLEDGOR SUBSIDIARIES OF ORGANIZATION
RELTEC Corporation Guangzhou RELTEC China
Communications
Technology
Company Ltd.
RELTEC Corporation RELTEC Services UK
(UK) Limited
RELTEC Corporation RELTEC New Brunswick
Canada Holdings, Inc.
RELTEC Corporation RELTEC Costa Rica
Costa Rica, S.A.
RELTEC Corporation RELTEC (HK) Limited Hong Kong
RELTEC Corporation RELTEC Mexico, Mexico
S.A. de C.V.
RELTEC Foreign
Holdings, Inc. RELTEC (UK) Limited UK
15
ANNEX B
to
SUBSIDIARY PLEDGE AGREEMENT
LIST OF STOCK
Number of
Shares Percentage Number
Name of Issuing Type of Owned by Owned by of Shares
PLEDGOR CORPORATION SHARES PLEDGOR PLEDGOR PLEDGED
Guangzhou
Reliance
RELTEC Comm/Tec
Corporation Company Ltd. N/A N/A 60% N/A
RELTEC Ordinary shares
RELTEC Services (UK) par value 1 Pound
Corporation Limited Sterling per share 10,100 100% 6,565
RELTEC RELTEC Canada Common stock,
Corporation Holdings, Inc. no par value 100 100% 65
Common shares,
RELTEC RELTEC Costa par value 1,000
Corporation Rica, S.A. colones per share 16 100% 10
Ordinary shares,
RELTEC RELTEC (HK) par value HK$
Corporation Limited 10.00 per share 100 99% 65
RELTEC
RELTEC Mexico, S.A. Common stock, no
Corporation de C.V. par value 999 99% 650
RELTEC
Foreign Ordinary shares,
Holdings, RELTEC (UK) par value 1 Pound
Inc. Limited Sterling per share 100 100% 65
16
ANNEX C
to
SUBSIDIARY PLEDGE AGREEMENT
LIST OF NOTES
Pledgor Issuer Amount Maturity Date
RELTEC RELTEC Canada The amount for each N/A
Corporation Holdings, Inc. Issuer shall equal
the unpaid principal
RELTEC Mexico, amount of all loans
S.A. de C.V. and advances made by
Pledgor to such
RELTEC (HK) Issuer as recorded
in the books and records
of Pledgor
RELTEC Costa Rica,
S.A.
RELTEC Services
(UK) Limited
17