EXHIBIT 10.3
PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of July 15, 2003 (as amended, modified or
supplemented from time to time, the "Agreement"), made by each of the
undersigned (together with any other entity that becomes a party hereto pursuant
to Section 23 hereof, each a "Pledgor" and, collectively, the "Pledgors"), in
favor of JPMORGAN CHASE BANK, as Collateral Agent (including any successor
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 referred to below shall be used herein as
therein defined.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, ▇.▇. ▇▇▇▇▇▇▇▇ Tobacco Holdings, Inc. (f/k/a RJR Nabisco, Inc.)
(the "Borrower"), the various lending institutions from time to time party
thereto (the "Lenders"), JPMORGAN CHASE BANK, as Administrative Agent (the
"Administrative Agent"), Citibank, N.A., as Syndication Agent (the "Syndication
Agent"), The Bank of New York, The Bank of Nova Scotia and ▇▇▇▇▇▇ Brothers,
Inc., as Documentation Agents (the "Documentation Agents") and Credit Lyonnais
New York Branch and Mizuho Corporate Bank, Ltd., as Co-Documentation Agents (the
"Co-Documentation Agents") have entered into a Credit Agreement, dated as of May
7, 1999, amended and restated as of November 17, 2000 and further amended and
restated as of May 10, 2002, providing for the making of Loans to the Borrower
and the issuance of, and participation in, Letters of Credit for the account of
the Borrower, all as contemplated therein (with (i) the Lenders, each Letter of
Credit Issuer, the Administrative Agent, the Syndication Agent, the
Documentation Agents, the Co-Documentation Agents, the Senior Managing Agents,
the Pledgee and the Collateral Agent being herein called the "Lender Creditors"
and (ii) the term "Credit Agreement" as used herein to mean the Credit Agreement
described above in this paragraph, as the same may be further amended, modified,
extended, renewed, replaced, restated, supplemented and/or refinanced from time
to time, and including any agreement extending the maturity of, or refinancing
or restructuring (including, but not limited to, the inclusion of additional
borrowers or guarantors thereunder or any increase in the amount borrowed) all
or any portion of, the indebtedness under such agreement or any successor
agreement, whether or not with the same agent, trustee, representative, lenders
or holders; provided that, with respect to any agreement providing for the
refinancing or replacement of indebtedness under the Credit Agreement, such
agreement shall only be treated as, or as part of, the Credit Agreement
hereunder if (x) either (A) all obligations under the Credit Agreement being
refinanced or replaced shall be paid in full at the time of such refinancing or
replacement, and all commitments and letters of credit issued pursuant to the
refinanced or replaced Credit Agreement shall have terminated in accordance with
their terms or (B) the Required Lenders shall have consented in writing to the
refinancing or replacement indebtedness being treated as indebtedness pursuant
to the Credit Agreement, and (y) a notice to the effect that the refinancing or
replacement indebtedness shall be treated as issued under the Credit Agreement
shall be delivered by the Borrower to the Collateral Agent);
WHEREAS, the Borrower has from time to time entered into, and/or may in
the future from time to time enter into, one or more (i) interest rate
protection agreements (including, without limitation, interest rate swaps, caps,
floors, collars and similar agreements), (ii) foreign exchange contracts,
currency swap agreements, commodity agreements or other similar agreements or
arrangements designed to protect against the fluctuations in currency values
and/or (iii) other types of hedging agreements from time to time (each such
agreement or arrangement with a Hedging Creditor (as hereinafter defined), a
"Secured Hedging Agreement"), with any Lender or Lenders or a syndicate of
financial institutions organized by a Lender or an affiliate of a Lender (even
if any such Lender ceases to be a Lender under the Credit Agreement for any
reason) (any institution that participates therein, and in each case their
subsequent successors and assigns collectively, the "Hedging Creditors", and
together with the Lender Creditors, the "Lender Secured Creditors");
WHEREAS, the Borrower and the trustee thereunder (the "New Senior Notes
Trustee"), on behalf of the holders of the New Senior Notes (such holders,
together with the New Senior Notes Trustee, the "New Senior Notes Creditors"),
have from time to time entered into, and may in the future from time to time
enter into, one or more Indentures (collectively, as amended, modified or
supplemented from time to time, the "New Senior Notes Indenture" and, together
with the New Senior Notes, the "New Senior Notes Documents") providing for the
issuance of New Senior Notes by the Borrower;
WHEREAS, the Borrower and the trustee thereunder (the "Refinancing
Senior Notes Trustee"), on behalf of the holders of the Refinancing Senior Notes
(such holders, together with the Refinancing Senior Notes Trustee, the
"Refinancing Senior Notes Creditors", with the Lender Secured Creditors, the New
Senior Notes Creditors and the Refinancing Senior Notes Creditors being herein
called the "Secured Creditors"), have from time to time entered into, and may in
the future from time to time enter into, one or more Indentures (collectively,
as amended, modified or supplemented from time to time, the "Refinancing Senior
Notes Indenture" and, together with the Refinancing Senior Notes, the
"Refinancing Senior Notes Documents") providing for the issuance of Refinancing
Senior Notes by the Borrower;
WHEREAS, pursuant to the Subsidiary Guaranty, each Pledgor (other than
the Borrower) has jointly and severally guaranteed to the Lender Secured
Creditors the payment when due of the Guaranteed Obligations (as and to the
extent defined in the Subsidiary Guaranty);
WHEREAS, pursuant to the Borrower Guaranty, the Borrower has guaranteed
to the Hedging Creditors the payment when due of the Guaranteed Obligations (as
and to the extent defined in the Borrower Guaranty);
WHEREAS, each Specified Pledgor (other than the Borrower) has jointly
and severally guaranteed to the New Senior Notes Creditors the payment when due
of principal and interest on the New Senior Notes;
WHEREAS, each Specified Pledgor (other than the Borrower) has jointly
and severally guaranteed to the Refinancing Senior Notes Creditors the payment
when due of principal and interest on the Refinancing Senior Notes;
-2-
WHEREAS, the Credit Agreement requires this Agreement be executed and
delivered to the Pledgee by the Pledgors and the Secured Hedging Agreements, the
New Senior Notes Indenture and the Refinancing Senior Notes Indenture require
that this Agreement secure the respective Obligations as provided herein;
WHEREAS, each Pledgor desires to execute this Agreement to satisfy the
requirements described in the preceding paragraph;
NOW, THEREFORE, in consideration of the benefits accruing to each
Pledgor, the receipt and sufficiency of which are hereby acknowledged, each
Pledgor hereby makes the following representations and warranties to the Pledgee
and hereby covenants and agrees with the Pledgee 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 (whether at the
stated maturity, by acceleration or otherwise) of all obligations
(including obligations which, but for the automatic stay under Section
362(a) of the Bankruptcy Code, would become due) and liabilities of
such Pledgor, now existing or hereafter incurred under, arising out of
or in connection with any Credit Document to which such Pledgor is a
party (including, without limitation, indemnities, fees and interest
(including all interest that accrues after the commencement of any
case, proceeding or other action relating to the bankruptcy,
insolvency, reorganization or similar proceeding of the Borrower or any
other Credit Party at the rate provided for in the respective
documentation, whether or not a claim for post-petition interest is
allowed in any such proceeding)) and the due performance of 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 liabilities with respect to
Secured Hedging 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
(including obligations which, but for the automatic stay under Section
362(a) of the Bankruptcy Code, would become due) and liabilities of
such Pledgor, now existing or hereafter incurred under, arising out of
or in connection with any Secured Hedging Agreement, including, all
obligations, if any, of such Pledgor under the Subsidiary Guaranty in
respect of Secured Hedging Agreements (all such obligations and
liabilities under this clause (ii) being herein collectively called the
"Hedging Obligations");
(iii) the full and prompt payment when due (whether at the
stated maturity, by acceleration or otherwise) of all obligations
(including obligations which, but for the automatic stay under Section
362(a) of the Bankruptcy Code, would become due) and liabilities of
such Pledgor (including, without limitation, indemnities, fees and
interest (including all interest that accrues after the commencement of
any case, proceeding or other action relating to the bankruptcy,
insolvency, reorganization or similar proceeding of the Borrower or any
other Credit Party at the rate provided for in the respective
-3-
documentation, whether or not a claim for post-petition interest is
allowed in any such proceeding)), now existing or hereafter incurred
under, arising out of or in connection with any New Senior Notes
Document, including, all obligations, if any, of such Pledgor under a
guaranty in respect of the New Senior Notes (all such obligations and
liabilities under this clause (iii) being herein collectively called
the "New Senior Notes Obligations");
(iv) the full and prompt payment when due (whether at the
stated maturity, by acceleration or otherwise) of all obligations
(including obligations which, but for the automatic stay under Section
362(a) of the Bankruptcy Code, would become due) and liabilities of
such Pledgor (including, without limitation, indemnities, fees and
interest (including all interest that accrues after the commencement of
any case, proceeding or other action relating to the bankruptcy,
insolvency, reorganization or similar proceeding of the Borrower or any
other Credit Party at the rate provided for in the respective
documentation, whether or not a claim for post-petition interest is
allowed in any such proceeding)), now existing or hereafter incurred
under, arising out of or in connection with any Refinancing Senior
Notes Document, including, all obligations, if any, of such Pledgor
under a guaranty in respect of the Refinancing Senior Notes (all such
obligations and liabilities under this clause (iv) being herein
collectively called the "Refinancing Senior Notes Obligations");
(v) any and all sums advanced by the Pledgee in order to
preserve the Collateral and/or its security interest therein;
(vi) in the event of any proceeding for the collection of the
Obligations (as defined below) or the enforcement of this Agreement,
after an Event of Default (such term, as used in this Agreement, shall
mean any Event of Default under the Credit Agreement, any "event of
default" under the New Senior Notes Documents or the Refinancing Senior
Notes Documents or any payment default by the Borrower under any
Secured Hedging 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 of or realizing on the Collateral, or of any exercise by the
Pledgee of its rights hereunder, together with reasonable attorneys'
fees and court costs; and
(vii) all amounts paid by any Secured Creditor as to which
such Secured Creditor has the right to reimbursement under Section 11
of this Agreement;
all such obligations, liabilities, sums and expenses set forth in clauses (i)
through (vii) of this Section 1 being herein collectively called the
"Obligations".
2. DEFINITIONS; REPRESENTATIONS. (a) The following capitalized terms
used herein shall have the definitions specified below:
"Adverse Claim" has the meaning given such term in Section 8-102(a)(1)
of the UCC.
-4-
"Agreement" shall have the meaning set forth in the first paragraph of
this Agreement.
"Applicable Obligations" shall have the meaning provided in Section 3.1
hereof.
"Borrower" shall have the meaning provided in the recitals to this
Agreement.
"CA Termination Date" shall have the meaning set forth in Section 18
hereof.
"Certificated Security" has the meaning given such term in Section
8-102(a)(4) of the UCC.
"Class" shall have the meaning provided in Section 20 hereof.
"Clearing Corporation" has the meaning given such term in Section
8-102(a)(5) of the UCC.
"Co-Documentation Agents" shall have the meaning provided in the
recitals to this Agreement.
"Collateral" shall have the meaning provided in Section 3.1 hereof.
"Collateral Accounts" means any and all accounts established and
maintained by the Pledgee in the name of any Pledgor to which Collateral may be
credited.
"Collateral Proceeds" shall have the meaning provided in Section 9
hereof.
"Credit Agreement" shall have the meaning provided in the recitals to
this Agreement.
"Credit Document Obligations" shall have the meaning provided in
Section 1 hereof.
"Designated Collateral" shall have the meaning provided in Section 3.1
hereof.
"Documentation Agents" shall have the meaning provided in the recitals
to this Agreement.
"Event of Default" shall have the meaning provided in Section 1 hereof.
"Excluded Domestic Entities" shall mean and include (i) Northern Brands
International, Inc., a Delaware corporation, (ii) ▇.▇. ▇▇▇▇▇▇▇▇ Tobacco
International Inc., a Delaware corporation, and (iii) during the sixty day
period following the effectiveness of this Agreement, ▇.▇. ▇▇▇▇▇▇▇▇ Tobacco
Foreign Sales Corporation, a corporation organized under the laws of the laws of
the U.S. Virgin Islands.
"Excluded Foreign Entities" shall mean and include (i) Quezon Holdings
BV, a corporation organized under the laws of the Netherlands, (ii) Santa Fe
Natural Tobacco Company Europe GmbH, a corporation organized under the laws of
Germany, (iii) Santa Fe
-5-
Natural Tobacco Company Limited, a corporation organized under the laws of
England and (iv) during the ninety day period following the effectiveness of
this Agreement, ▇.▇. ▇▇▇▇▇▇▇▇ Tobacco C.V., a corporation organized under the
laws of the Netherlands; provided that if at the time of the delivery (or
required delivery) of the financial statements of the Borrower pursuant to
Section 7.01(a) or (b) of the Credit Agreement, the net book value of the assets
of any Excluded Foreign Entity as at the last day of the fiscal quarter or
fiscal year, as the case may be, to which such financial statements relate is
greater than $25,000,000, then on the 90th day following the delivery (or
required delivery) of such financial statements, such entity shall cease to be
an "Excluded Foreign Entity" for purposes of this Agreement.
"Excluded Investment Entities" shall mean and include (i) Targacept,
Inc., a Delaware corporation, (ii) Technology Concepts & Design, Inc., a
Virginia corporation, (iii) Intellilink Services, Inc., a Georgia corporation,
(iv) an investment in Mountain Capital CLO II Ltd, a corporation organized under
the laws of the Cayman Islands, so long as the aggregate amount of such
investment does not exceed $5,000,000, and (v) any other CLO investment owned by
a Pledgor, so long as the aggregate amount of all such CLO investments do not
exceed $15,000,000; provided that the each of foregoing entities shall cease to
be an "Excluded Investment Entity" at such time as the organizational documents
governing the respective such entity cease to prohibit the assignment of, or
granting of a security interest in, capital stock of such entity, it being
understood and agreed that any such excluded capital stock shall be subject to
the security interests created by this Agreement upon the receipt by the
respective Pledgor of any necessary approvals or waivers permitting the
assignment thereof or the granting of a security interest therein.
"Financial Asset" has the meaning given such term in Section
8-102(a)(9) of the UCC, provided that the term "Financial Asset" shall not
include (i) any capital stock of any Excluded Domestic Entity or any Excluded
Investment Entity or (ii) any Margin Stock.
"Hedging Creditors" shall have the meaning provided in the recitals to
this Agreement.
"Hedging Obligations" shall have the meaning provided in Section 1
hereof.
"Indemnitees" shall have the meaning set forth in Section 11 hereof.
"Instrument" has the meaning given such term in Section 9-102(a)(47) of
the UCC.
"Investment Property" has the meaning given such term in Section
9-102(a)(49) of the UCC, provided that the term "Investment Property" shall not
include (i) any capital stock of any Excluded Domestic Entity or any Excluded
Investment Entity or (ii) any Margin Stock.
"Lender Creditors" shall have the meaning provided in the recitals to
this Agreement.
"Lender Secured Creditors" shall have the meaning provided in the
recitals to this Agreement.
-6-
"Lenders" shall have the meaning provided in the recitals to this
Agreement.
"Limited Liability Company Assets" shall mean all assets, whether
tangible or intangible and whether real, personal or mixed (including, without
limitation, all limited liability company capital and interests in other limited
liability companies), at any time owned or represented by any Limited Liability
Company Interest.
"Limited Liability Company Interest" shall mean the entire limited
liability company interest at any time owned by each Pledgor in any limited
liability company (with any limited liability company the equity interests of
which are required to be included as "Limited Liability Company Interests"
hereunder being herein called a "Pledged LLC").
"LSB Note" shall mean that certain Non-Recourse Secured Promissory
Note, dated May 14, 1997, made by Technology Directors II, LLC to ▇.▇. ▇▇▇▇▇▇▇▇
Tobacco Company (as assignee of ▇▇▇▇▇▇▇▇ Technologies, Inc.) as amended from
time to time, in an aggregate principal amount of $15,000,000.
"New Senior Notes Creditors" shall have the meaning provided in the
recitals to this Agreement.
"New Senior Notes Documents" shall have the meaning provided in the
recitals to this Agreement.
"New Senior Notes Indenture" shall have the meaning provided in the
recitals to this Agreement.
"New Senior Notes Obligations" shall have the meaning provided in
Section 1 hereof.
"New Senior Notes Trustee" shall have the meaning provided in the
recitals to this Agreement.
"Notes" shall mean all promissory notes at any time issued to, or held
by, any Pledgor, provided that the term "Note" shall not include the LSB Note.
"Noticed Event of Default" shall have the meaning provided in Section 5
hereof.
"Notified Non-Credit Agreement Event of Default" means (i) the
acceleration of the maturity of any New Senior Notes or Refinancing Senior Notes
or the failure to pay at maturity any New Senior Notes or Refinancing Senior
Notes, or the occurrence of any bankruptcy or insolvency Event of Default under
the New Senior Notes Indenture or the Refinancing Senior Notes Indenture, or
(ii) any Event of Default under a Secured Hedging Agreement, in the case of any
event described in clause (i) or (ii) to the extent the New Senior Notes
Trustee, the Refinancing Senior Notes Trustee or the relevant Hedging Creditor,
as the case may be, has given written notice to the Collateral Agent that a
"Notified Non-Credit Agreement Event of Default" exists; provided that such
written notice may only be given if such Event of Default is continuing and,
provided further, that any such Notified Non-Credit Agreement Event of Default
shall cease to exist (I) once there is no longer any Event of Default
-7-
under the New Senior Notes Indenture, the Refinancing Senior Notes Indenture or
the respective Secured Hedging Agreement, as the case may be, in existence, (II)
in the case of an Event of Default under the New Senior Notes Indenture or the
Refinancing Senior Notes Indenture, after all New Senior Notes Obligations or
Refinancing Senior Notes Obligations, as the case may be, have been repaid in
full, (III) in the case of an Event of Default under a Secured Hedging
Agreement, such Secured Hedging Agreement has been terminated and all Hedging
Obligations thereunder repaid in full, (IV) in the case of an Event of Default
under the New Senior Notes Indenture or the Refinancing Senior Notes Indenture,
if the New Senior Notes Creditors or the Refinancing Senior Notes Creditors, as
the case may be, holding at least a majority of the aggregate principal amount
of the outstanding new Senior Notes or the Refinancing Senior Notes, as the case
may be, at such time have rescinded such written notice and (V) in the case of
an Event of Default under a Secured Hedging Agreement, the requisite Hedging
Creditors with Hedging Obligations thereunder at such time have rescinded such
written notice.
"Obligations" shall have the meaning provided in Section 1 hereof.
"Partnership Assets" shall mean all assets, whether tangible or
intangible and whether real, personal or mixed (including, without limitation,
all partnership capital and interests in other partnerships), at any time owned
or represented by any Pledged Partnership or represented by any Partnership
Interest.
"Partnership Interest" shall mean the entire partnership interests
(whether general and/or limited partnership interests) at any time owned by each
Pledgor in any partnership (with any partnership the partnership interests of
which are required to be included as "Partnership Interests" hereunder being
herein called a "Pledged Partnership", and together with any Pledged LLC, each,
a "Pledged Entity").
"Pledged Entity" shall have the meaning provided in the definition of
"Partnership Interest."
"Pledged Notes" shall mean all Notes at any time pledged or required to
be pledged hereunder.
"Pledged Limited Liability Company Interests" shall mean all Limited
Liability Company Interests at any time pledged or required to be pledged
hereunder.
"Pledged LLC" shall have the meaning provided in the definition of
"Limited Liability Company Interest".
"Pledged Partnership" shall have the meaning provided in the definition
of "Partnership Interest".
"Pledged Partnership Interests" shall mean all Partnership Interests at
any time pledged or required to be pledged hereunder.
"Pledgee" shall have the meaning provided in the first paragraph of
this Agreement.
-8-
"Pledgor" shall have the meaning provided in the first paragraph of
this Agreement.
"Principal Property" shall have the meaning provided in the New Senior
Notes Indenture or the Refinancing Senior Notes Indenture (in each case as in
effect on the date hereof), as the context may require.
"Proceeds" has the meaning given such term in Section 9-102(a)(64) of
the UCC.
"Pro Rata Share" shall have the meaning provided in Section 9 hereof.
"Refinancing Senior Notes Creditors" shall have the meaning provided in
the recitals to this Agreement.
"Refinancing Senior Notes Documents" shall have the meaning provided in
the recitals to this Agreement.
"Refinancing Senior Notes Indenture" shall have the meaning provided in
the recitals to this Agreement.
"Refinancing Senior Notes Obligations" shall have the meaning provided
in Section 1 hereof.
"Refinancing Senior Notes Trustee" shall have the meaning provided in
the recitals to this Agreement.
"Requisite Creditors" shall have the meaning provided in Section 20
hereof.
"Restricted Subsidiary" shall mean each Subsidiary that is a Restricted
Subsidiary, as such term is defined in the New Senior Notes Indenture or the
Refinancing Senior Notes Indenture (each, as in effect on the date hereof), as
the context may require.
"Secured Creditors" shall have the meaning set forth in the recitals to
this Agreement.
"Secured Debt Agreements" shall have the meaning provided in Section 5
hereof.
"Secured Hedging Agreement" shall have the meaning provided in the
recitals to this Agreement.
"Securities Account" has the meaning given such term in Section
8-501(a) of the UCC.
"Security" and "Securities" has the meaning given such term in Section
8-102(a)(15) of the UCC and shall in any event also include all Stock and all
Notes, provided that the terms "Security" and "Securities" shall not include (i)
any capital stock of any Excluded Domestic Entity or any Excluded Investment
Entity or (ii) any Margin Stock.
-9-
"Security Entitlement" has the meaning given such term in Section
8-102(a)(17) of the UCC.
"Specified Pledgor" shall have the meaning provided in Section 3.1
hereof.
"Stock" shall mean (i) all of the issued and outstanding shares of
stock of any corporation (other than a corporation that is not organized under
the laws of the United States or any State or territory thereof (a "Foreign
Corporation")) at any time directly owned by any Pledgor, and (ii) all of the
issued and outstanding shares of capital stock of any Foreign Corporation at any
time owned by any Pledgor, provided that such Pledgor shall not be required to
pledge hereunder the capital stock of a Foreign Corporation if more than 65% of
the total combined voting power of all classes of capital stock of any Foreign
Corporation entitled to vote are pledged hereunder (after giving effect to the
pledge of capital stock of such Foreign Corporation by other Pledgors
hereunder), provided further that the term "Stock" shall not include (i) any
capital stock of any Excluded Domestic Entity or any Excluded Investment Entity,
(ii) any Margin Stock and (iii) excess capital stock of a Foreign Corporation
not required to be pledged hereunder as a result of the application of the
preceding proviso.
"Subsequent Effective Date" shall have the meaning set forth in Section
18 hereof.
"Syndication Agent" shall have the meaning provided in the recitals to
this Agreement.
"Termination Date" shall have the meaning set forth in Section 18
hereof.
"UCC" means the Uniform Commercial Code as in effect in the State of
New York from time to time; provided that all references herein to specific
sections or sub-sections of the UCC are references to such sections or
subsections, as the case may be, of the Uniform Commercial Code as in effect in
the State of New York on the date hereof.
"Uncertificated Security" has the meaning given such term in Section
8-102(a)(18) of the UCC.
(b) Each Pledgor represents and warrants that on the date hereof (or if
later the date it first becomes party hereto) and on any Subsequent Effective
Date: (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 Stock constitutes that percentage of the issued and
outstanding capital stock of the issuing corporation as set forth in Annex B
hereto; (d) the Notes held by such Pledgor consist of the promissory notes
described in Annex C hereto; (e) the Limited Liability Company Interests held by
such Pledgor consists of the number and type of interest of the Pledged LLC as
described in Annex D hereto; (f) such Limited Liability Company Interests
constitute the percentage of the issued and outstanding equity interests of the
Pledged LLC as set forth in Annex D hereto; (g) except for such immaterial
exceptions set forth on Annexes B and C as may be reasonably acceptable to the
Pledgee, each such Pledgor is the holder of record and sole beneficial owner of
the Stock, the Notes and the Securities identified on Annex G hereto; (h) the
Partnership Interests held by such Pledgor consists of the number and
-10-
type of interest of the Pledged Partnership as described in Annex E hereto; (i)
the Partnership Interests held by such Pledgor constitutes that percentage of
the entire Partnership Interest of the respective Pledged Partnership as is set
forth in Annex E hereto for such Pledgor; (j) such Pledgor owns or possesses no
other Securities except as described on Annexes B, C, D, E and G hereto; and (k)
such Pledgor has complied with the respective procedures set forth in Section
3.2(a) with respect to each item of Collateral described in Annexes B through E
hereto that is required by this Agreement to be pledged to the Pledgee on the
date hereof (or the respective subsequent Effective Date).
3. PLEDGE OF SECURITIES, ETC.
3.1 Pledge. To secure the Applicable Obligations for such Pledgor and
for the purposes set forth in Section 1, each Pledgor does hereby grant, pledge
and assign to the Pledgee for the benefit of the relevant Secured Creditors, and
does hereby create a continuing security interest in favor of the Pledgee for
the benefit of the relevant Secured Creditors in, all of the right, title and
interest in and to the following, whether now existing or hereafter from time to
time acquired (collectively, the "Collateral"):
(i) each of the Collateral Accounts, including any and all
assets of whatever type or kind deposited by such Pledgor in such
Collateral Account, whether now owned or hereafter acquired, existing
or arising, including, without limitation, all Financial Assets,
Investment Property, moneys, checks, drafts, Instruments, Securities or
interests therein of any type or nature deposited or required by the
Credit Agreement or any other Secured Debt Agreement to be deposited in
such Collateral Account, and all investments and all certificates and
other Instruments (including depository receipts, if any) from time to
time representing or evidencing the same, and all dividends, interest,
distributions, cash and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for
any or all of the foregoing;
(ii) all Securities owned by such Pledgor from time to time
and all options and warrants owned by such Pledgor from time to time to
purchase Securities;
(iii) all Limited Liability Company Interests owned by such
Pledgor from time to time and all of such Pledgor's right, title and
interest in each limited liability company to which such interests
relate, whether now existing or hereafter acquired, including, without
limitation:
(1) all the capital thereof and its interest in all
profits, income, surpluses, losses, Limited Liability Company
Assets, distributions and other payments to which such Pledgor
shall at any time be entitled in respect of such Limited
Liability Company Interests;
(2) all other payments due or to become due to such
Pledgor in respect of Limited Liability Company Interests,
whether under any limited liability company agreement or
otherwise, whether as contractual obligations, damages,
insurance proceeds or otherwise;
-11-
(3) all of its claims, rights, powers, privileges,
authority, options, security interest, liens and remedies, if
any, under any limited liability company agreement or
operating agreement, or at law or otherwise in respect of such
Limited Liability Company Interests;
(4) all present and future claims, if any, of any of
such Pledgor against any such Pledged LLC for moneys loaned or
advanced, for services rendered or otherwise;
(5) all of such Pledgor's rights under any limited
liability company agreement or operating agreement or at law
to exercise and enforce every right, power, remedy, authority,
option and privilege of any of such Pledgor relating to such
Limited Liability Company Interests, including any power to
terminate, cancel or modify any limited liability company
agreement or operating agreement, to execute any instruments
and to take any and all other action on behalf of and in the
name of any of such Pledgor in respect of such Limited
Liability Company Interest and any such Pledged LLC, to make
determinations, to exercise any election (including, but not
limited to, election of remedies) or option or to give or
receive any notice, consent, amendment, waiver or approval,
together with full power and authority to demand, receive,
enforce, collect or receipt for any of the foregoing or for
any Limited Liability Company Asset, to enforce or execute any
checks, or other instruments or orders, to file any claims and
to take any action in connection with any of the foregoing
(with all of the foregoing rights to be exercisable only upon
the occurrence and during the continuation of a Noticed Event
of Default); and
(6) all other property hereafter delivered in
substitution for or in addition to any of the foregoing, all
certificates and instruments representing or evidencing such
other property and all cash, securities, interest, dividends,
rights and other property at any time and from time to time
received, receivable or otherwise distributed in respect of or
in exchange for any or all thereof;
(iv) all Partnership Interests owned by such Pledgor from time
to time and all of such Pledgor's right, title and interest in each
partnership to which such interests relate, whether now existing or
hereafter acquired, including, without limitation:
(1) all of the capital thereof and its interest in
all profits, income, surplus, losses, Partnership Assets,
distributions and other payments to which such Pledgor shall
at any time be entitled in respect of any such Partnership
Interest;
(2) all other payments due or to become due to such
Pledgor in respect of any such Partnership Interest, whether
under any partnership agreement or otherwise, whether as
contractual obligations, damages, insurance proceeds or
otherwise;
-12-
(3) all of its claims, rights, powers, privileges,
authority, options, security interest, liens and remedies, if
any, under any partnership or other agreement or at law or
otherwise in respect of any such Partnership Interest;
(4) all present and future claims, if any, of such
Pledgor against any Pledged Partnership for moneys loaned or
advanced, for services rendered or otherwise;
(5) all of such Pledgor's rights under any
partnership agreement or at law to exercise and enforce every
right, power, remedy, authority, option and privilege of such
Pledgor relating to any Partnership Interest, including any
power, if any, to terminate, cancel or modify any general or
limited partnership agreement, to execute any instruments and
to take any and all other action on behalf of and in the name
of such Pledgor in respect of such Partnership Interest and
any Pledged Partnership, to make determinations, to exercise
any election (including, but not limited to, election of
remedies) or option or to give or receive any notice, consent,
amendment, waiver or approval, together with full power and
authority to demand, receive, enforce, collect, or receipt for
any of the foregoing or for any Partnership Asset, to enforce
or execute any checks, or other instruments or orders, to file
any claims and to take any action in connection with any of
the foregoing (with all of the foregoing rights to be
exercisable only upon the occurrence and during the
continuation of a Noticed Event of Default);
(6) all other property hereafter delivered in
substitution for or in addition to any of the foregoing, all
certificates and instruments representing or evidencing such
other property and all cash, securities, interest, dividends,
rights and other property at any time and from time to time
received, receivable or otherwise distributed in respect of or
in exchange for any or all thereof;
(v) all Financial Assets and Investment Property owned by such
Pledgor from time to time;
(vi) all Security Entitlements owned by such Pledgor from time
to time in any and all of the foregoing; and
(vii) all Proceeds of any and all of the foregoing.
As used herein, "Applicable Obligations" shall mean (x) for each Pledgor (each,
a "Specified Pledgor") that is the Borrower or a Restricted Subsidiary, all the
Obligations and (y) for each other Pledgor, all the Obligations other than the
New Senior Notes Obligations and the Refinancing Senior Notes Obligations,
provided that (i) the New Senior Notes Obligations shall be excluded from the
Applicable Obligations of the Borrower or a Restricted Subsidiary to the extent
the New Senior Notes Documents do not require the New Senior Notes Obligations
to be secured pursuant to this Agreement and (ii) the Refinancing Senior Notes
Obligations shall be excluded from the Applicable Obligations of the Borrower or
a Restricted Subsidiary to the extent the Refinancing Senior Notes Documents do
not require the Refinancing Senior Notes Obligations to be secured pursuant to
this Agreement. Notwithstanding anything to the contrary
-13-
contained in this Agreement, the Collateral that secures the New Senior Notes
Obligations or the Refinancing Senior Notes Obligations of a Specified Pledgor
shall be limited to Collateral consisting of any shares of stock, indebtedness
or other obligations of a Subsidiary or of any Principal Property of the
Borrower or any Restricted Subsidiary (the "Designated Collateral"), all of
which Collateral shall also ratably secure all other Applicable Obligations of
such Specified Pledgor, and the Collateral Proceeds with respect to any item of
Collateral owned by a Specified Pledgor that are to be applied to the New Senior
Notes Obligations or to the Refinancing Senior Notes Obligations shall be
limited to Collateral Proceeds resulting from the sale, other disposition of or
other realization upon, and other moneys received in respect of, the Designated
Collateral of such Specified Pledgor, with such Collateral Proceeds to also be
applied ratably to all other Applicable Obligations of such Specified Pledgor.
3.2. Procedures. (a) To the extent that any Pledgor at any time or from
time to time owns, acquires or obtains any right, title or interest in any
Collateral, such Collateral shall automatically (and without the taking of any
action by the respective Pledgor) be pledged pursuant to Section 3.1 of this
Agreement and, in addition thereto, such Pledgor shall (to the extent provided
below) take the following actions for the benefit of the Pledgee and the other
relevant Secured Creditors as set forth below as promptly as practicable and, in
any event, within 10 Business Days after it obtains such Collateral, provided
that (i) in the case of Collateral consisting of an Uncertificated Security,
Limited Liability Company Interest or Partnership Interest of a Person which is
not a Subsidiary of such Pledgor and a security interest in which is to be
perfected by taking an action specified in sub-clause (ii) or (iv)(2) below,
such Pledgor shall have 30 days after it obtains such Collateral to take the
respective action required by said sub-clause, (ii) in the case of Collateral a
security interest in which is to be perfected by taking an action specified in
sub-clause (iii) below, such Pledgor shall have 90 days after the date of this
Agreement (or, if such Collateral is acquired after the date hereof, the date it
obtains such Collateral) to take the respective action required by said
sub-clause and (iii) in the case of any Security, Stock, Limited Liability
Company Interest or Partnership Interest of an Excluded Foreign Entity, such
Pledgor owning the same shall take the respective action required below on the
date such Excluded Foreign Entity ceases to qualify as an "Excluded Foreign
Entity" in accordance with the definition thereof:
(i) with respect to a Certificated Security (other than a
Certificated Security credited on the books of a Clearing Corporation),
the respective Pledgor shall deliver such Certificated Security to the
Pledgee, indorsed to the Pledgee or indorsed in blank;
(ii) with respect to an Uncertificated Security (other than an
Uncertificated Security credited on the books of a Clearing
Corporation), the respective Pledgor shall cause the issuer of such
Uncertificated Security (or, in the case of an issuer that is not a
Subsidiary of such Pledgor, will use reasonable efforts to cause such
issuer) to duly authorize and execute, and deliver to the Pledgee, an
agreement for the benefit of the Pledgee and the other Secured
Creditors substantially in the form of Annex F hereto (appropriately
completed to the reasonable satisfaction of the Pledgee and with such
modifications, if any, as shall be reasonably satisfactory to the
Pledgee) pursuant to which, subject to Section 5 hereof, such issuer
agrees to comply with any and all instructions originated by the
Pledgee without further consent by the registered owner and not to
comply with instructions regarding such Uncertificated Security (and
any
-14-
Partnership Interest and Limited Liability Company Interest issued by
such issuer) originated by any other Person other than a court of
competent jurisdiction; provided that in the case of an Uncertificated
Security issued by a Person that is organized under the laws of a
jurisdiction other than the United States or any state thereof, such
Pledgor shall enter into a Foreign Pledge Agreement and comply with the
requirements of Section 16(d) as if said Person had been (but then
ceased to be) an Excluded Foreign Entity,
(iii) with respect to a Certificated Security, Uncertificated
Security, Partnership Interest or Limited Liability Company Interest
credited on the books of a Clearing Corporation (including a Federal
Reserve Bank, Participants Trust Company or The Depository Trust
Company), the respective Pledgor shall promptly notify the Pledgee
thereof and shall promptly take (x) all actions required (i) to comply
with the applicable rules of such Clearing Corporation and (ii) to
perfect the security interest of the Pledgee under applicable law
(including, in any event, under Sections 9-314(a) and (b), 9-106 and
8-106(d) of the UCC) and (y) such other actions as the Pledgee deems
reasonably necessary or desirable to effect the foregoing;
(iv) with respect to a Partnership Interest or a Limited
Liability Company Interest (other than a Partnership Interest or
Limited Liability Interest credited on the books of a Clearing
Corporation), (1) if such Partnership Interest or Limited Liability
Company Interest is represented by a certificate and is a Security for
purposes of the UCC, the procedure set forth in Section 3.2(a)(i)
hereof, and (2) if such Partnership Interest or Limited Liability
Company Interest is not represented by a certificate or is not a
Security for purposes of the UCC, the procedure set forth in Section
3.2(a)(ii) hereof;
(v) with respect to any Note, delivery of such Note to the
Pledgee, indorsed to the Pledgee or indorsed in blank; and
(vi) with respect to cash proceeds, (i) establishment by the
Pledgee of a cash account in the name of such Pledgor over which the
Pledgee shall have exclusive and absolute control and dominion (and no
withdrawals or transfers may be made therefrom by any Person except
with the prior written consent of the Pledgee) and (ii) deposit of such
cash in such cash account.
(b) In addition to the actions required to be taken pursuant to Section
3.2(a) hereof, each Pledgor shall take the following additional actions with
respect to the Collateral:
(i) with respect to all Collateral of such Pledgor whereby or
with respect to which the Pledgee may obtain "control" thereof within
the meaning of Section 8-106 of the UCC (or under any provision of the
UCC as same may be amended or supplemented from time to time, or under
the laws of any relevant State other than the State of New York), the
respective Pledgor shall take all actions as may be reasonably
requested from time to time by the Pledgee so that "control" of such
Collateral is obtained and at all times held by the Pledgee; and
(ii) each Pledgor shall from time to time cause appropriate
financing statements (on Form UCC-1 or other appropriate form) under
the Uniform Commercial
-15-
Code as in effect in the various relevant States, covering all
Collateral hereunder (with the form of such financing statements to be
satisfactory to the Pledgee), to be filed in the relevant filing
offices so that at all times the Pledgee has a security interest in all
Investment Property and other Collateral which is perfected by the
filing of such financing statements (in each case to the maximum extent
perfection by filing may be obtained under the laws of the relevant
States, including, without limitation, Section 9-312(a) of the UCC).
3.3. Subsequently Acquired Collateral. If any Pledgor shall acquire (by
purchase, stock dividend or similar distribution or otherwise) any additional
Collateral at any time or from time to time after the date hereof, such
Collateral shall automatically (and without any further action being required to
be taken) be subject to the pledge and security interests created pursuant to
Section 3.1 hereof and, furthermore, the respective Pledgor will promptly
thereafter take (or cause to be taken) all action with respect to such
Collateral in accordance with the procedures set forth in Section 3.2 hereof,
and will promptly thereafter deliver to the Pledgee (i) a certificate executed
by a principal executive officer of such Pledgor describing such Collateral and
certifying that the same has been duly pledged in favor of the Pledgee (for the
benefit of the relevant Secured Creditors entitled thereto) hereunder and (ii)
supplements to Annexes A through E hereto as are reasonably necessary to cause
such annexes to be complete and accurate at such time, provided that unless
specifically requested by the Collateral Agent, such updated Annexes shall not
be required to include any after-acquired Securities pledged to the Pledgee
pursuant to the procedures set forth in Section 3.2(a)(iii). Notwithstanding the
foregoing, no Pledgor shall be required at any time to pledge hereunder any
Stock which will result in more than 65% of the total combined voting power of
all classes of capital stock of any Foreign Corporation entitled to vote being
pledged hereunder.
3.4. Transfer Taxes. Each pledge of Collateral under Section 3.1 or
Section 3.3 hereof shall be accompanied by any transfer tax stamps required in
connection with the pledge of such Collateral.
4. APPOINTMENT OF SUB-AGENTS; ENDORSEMENTS, ETC. The Pledgee shall have
the right to appoint one or more sub-agents for the purpose of retaining
physical possession of the Collateral, which may be held (in the discretion of
the Pledgee) in the name of the relevant Pledgor, endorsed or assigned in blank
or, following a Noticed Event of Default which is continuing, 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 a Noticed
Event of Default shall have occurred and be continuing, each Pledgor shall be
entitled to exercise all voting rights attaching to any and all Collateral 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, result in breach of any covenant
contained in, or be inconsistent with, any of the terms of this Agreement, the
Credit Agreement, any other Credit Document, any New Senior Notes Document, any
Refinancing Senior Notes Document or any Secured Hedging Agreement
(collectively, the "Secured Debt Agreements"), or which would have the effect of
impairing the value of the Collateral or any part thereof or the position or
interests of the Pledgee or any other Secured Creditor therein, provided
-16-
however, each Pledgor shall be permitted to amend and/or modify intercompany
notes constituting Collateral in the ordinary course of business and consistent
with past practices. All such rights of a Pledgor to vote and to give consents,
waivers and ratifications shall cease in case a Noticed Event of Default shall
occur and be continuing and Section 7 hereof shall become applicable. As used
herein, a "Noticed Event of Default" shall mean (i) an Event of Default with
respect to the Borrower under Section 9.05 of the Credit Agreement and (ii) any
other Event of Default in respect of which the Pledgee has given the Borrower
notice that such Event of Default constitutes a "Noticed Event of Default".
6. DIVIDENDS AND OTHER DISTRIBUTIONS. Unless and until a Noticed Event
of Default shall have occurred and be continuing, all cash dividends,
distributions, cash Proceeds or other amounts payable in respect of the
Collateral shall be paid to the respective Pledgor; provided that all dividends
or other amounts payable in respect of the Collateral which are determined by
the Pledgee, to represent in whole or in part an extraordinary, liquidating or
other distribution in return of capital not permitted by the Credit Agreement
shall be paid, to the extent so determined to represent an extraordinary,
liquidating or other distribution in return of capital, to the Pledgee and
retained by it as part of the Collateral (unless such cash dividends are applied
to repay the Obligations pursuant to Section 9 of this Agreement). The Pledgee
shall also be entitled to receive directly, and to retain as part of the
Collateral:
(i) all other or additional stock, notes, limited liability
company interests, partnership interests, instruments or other
securities or property (other than cash) paid or distributed by way of
dividend or otherwise in respect of the Collateral;
(ii) all other or additional stock, notes, limited liability
company interests, partnership interests, instruments or other
securities or property (including cash) paid or distributed in respect
of the Collateral by way of stock-split, spin-off, split-up,
reclassification, combination of shares or similar rearrangement; and
(iii) all other or additional stock, notes, limited liability
company interests, partnership interests, instruments or other
securities or property (including cash) 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,
partnership or other reorganization.
Nothing contained in this Section 6 shall limit or restrict in any way the
Pledgee's right to receive proceeds of the Collateral in any form in accordance
with Section 3 of this Agreement. All dividends, distributions or other payments
which are received by the respective Pledgor contrary to the provisions of this
Section 6 or Section 7 shall be received in trust for the benefit of the Pledgee
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 AN EVENT OF DEFAULT. In case a Noticed 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
-17-
default under the Uniform Commercial Code as in effect in any relevant
jurisdiction, and the Pledgee shall be entitled, without limitation, to exercise
any or all of the following rights, which each Pledgor hereby agrees to be
commercially reasonable:
(i) to receive all amounts payable in respect of the
Collateral otherwise payable under Section 6 to such Pledgor;
(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 lawful action to
collect upon any Pledged Note (including, without limitation, to make
any demand for payment thereon);
(iv) to vote all or any part of the Collateral (in each case
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);
(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 or advertisement 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 reasonable discretion may
determine, provided that at least 10 days' notice of the time and place
of any such sale shall be given to such Pledgor. The Pledgee shall not
be obligated to make such sale of Collateral regardless of whether any
such notice of sale has theretofore been given. 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 all Secured Creditors (or certain of them) 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 other
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 it
be under any obligation to take any action whatsoever with regard
thereto; and
(vi) to set-off any and all Collateral against any and all
Obligations, and to withdraw any and all cash or other Collateral from
any and all Collateral Accounts and to apply such cash and other
Collateral to the payment of any and all Obligations.
-18-
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 other
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 other Secured Creditor of
all such other rights, powers or remedies, and no failure or delay on the part
of the Pledgee or any other Secured Creditor to exercise any such right, power
or remedy shall operate as a waiver thereof. Unless otherwise required by the
Credit Documents, no notice to or demand on any Pledgor in any case shall
entitle it to any other or further notice or demand in similar other
circumstances or constitute a waiver of any of the rights of the Pledgee or any
other Secured Creditor to any other further action in any circumstances without
demand or notice. By accepting the benefits of this Agreement, the Secured
Creditors expressly acknowledge and agree that (x) this Agreement may be
enforced only by the action of the Pledgee acting upon the instructions of the
Required Lenders or, if the CA Termination Date has occurred, the holders of a
majority of the outstanding principal amount of all remaining Obligations,
provided that if prior to the CA Termination Date a payment default with respect
to at least $300,000,000 principal amount in the aggregate of New Senior Notes
and/or Refinancing Senior Notes has continued for at least 180 days (and such
defaulted payment has not been received pursuant to a drawing under any letter
of credit), the holders of a majority of the outstanding principal amount of the
Indebtedness subject to such payment default or defaults can direct the Pledgee
to commence and continue enforcement of the Liens created hereunder, which the
Pledgee shall comply with subject to receiving any indemnity which it reasonably
requests, provided further that the Pledgee shall thereafter comply only with
the directions of the Required Lenders as to how to carry out such enforcement
so long as such directions are not adverse to the aforesaid directions of the
holders of Indebtedness subject to such payment default or defaults and (y) no
other Secured Creditor shall have any right individually to seek to enforce or
to enforce this Agreement or to realize upon the security to be granted hereby,
it being understood and agreed that such rights and remedies shall be exercised
exclusively by the Pledgee for the benefit of the Secured Creditors as their
interest may appear upon the terms of this Agreement.
9. APPLICATION OF PROCEEDS. (a) All moneys collected by the Pledgee
upon any sale, other disposition of or other realization upon any Collateral
pursuant to the terms of this Agreement, together with all other moneys received
by the Pledgee hereunder (collectively, the "Collateral Proceeds"), shall be
applied as follows:
(i) first, to the payment of all Obligations owing to the
Pledgee of the type described in clauses (v), (vi) and (vii) of Section
1 herein;
(ii) second, to the extent proceeds of the sale, other
disposition of or other realization upon any item of Collateral remain
after the application pursuant to preceding clause (i), an amount equal
to the outstanding Applicable Obligations secured by such item of
Collateral shall be paid to the Secured Creditors in the manner
provided below as their interests may appear, with each Secured
Creditor receiving an amount equal to its outstanding Applicable
Obligations secured by such item of Collateral or, if the proceeds
-19-
are insufficient to pay in full all such Applicable Obligations, its
Pro Rata Share of the amount so remaining to be distributed, with any
such amount to be applied in the case of the Credit Document
Obligations, the New Senior Notes Obligations and the Refinancing
Senior Notes Obligations, first to the payment of interest in respect
of the unpaid principal amount of Loans, New Senior Notes or
Refinancing Senior Notes, as the case may be, second to the payment of
principal of Loans, New Senior Notes or Refinancing Senior Notes, as
the case may be, and finally to the other Credit Document Obligations,
New Senior Notes Obligations or Refinancing Senior Notes Obligations,
as the case may be; and
(iii) third, to the extent proceeds remain after the
application pursuant to the preceding clauses (i) and (ii) to the
relevant Pledgor or, to the extent directed by such Pledgor or a court
of competent jurisdiction, 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 pursuant
to clause (a) above, the amount (expressed as a percentage) equal to a fraction
the numerator of which is the then outstanding amount of the relevant Applicable
Obligations secured by the relevant item of Collateral owed such Secured
Creditor and the denominator of which is the then outstanding amount of all
Applicable Obligations secured by the relevant item of Collateral.
(c) All payments required to be made to the (i) Lender Creditors
hereunder shall be made to the Administrative Agent for the account of the
respective Lender Creditors, (ii) Hedging Creditors hereunder shall be made to
the paying agent under the applicable Secured Hedging Agreement or, in the case
of Secured Hedging Agreements without a paying agent, directly to the applicable
Hedging Creditors, (iii) New Senior Notes Creditors hereunder shall be made to
the New Senior Notes Trustee for the account of the respective New Senior Notes
Creditors and (iv) Refinancing Senior Notes Creditors hereunder shall be made to
the Refinancing Senior Notes Trustee for the account of the respective
Refinancing Senior Notes Creditors.
(d) For purposes of applying payments received in accordance with this
Section 9, the Pledgee shall be entitled to rely upon (i) the Administrative
Agent for a determination of the outstanding Credit Document Obligations, (ii)
upon any Hedging Creditor for a determination of the outstanding Hedging
Obligations owed to such Hedging Creditor, (iii) the New Senior Notes Trustee
for a determination of the outstanding New Senior Notes Obligations, and (iv)
the Refinancing Senior Notes Trustee for a determination of the outstanding
Refinancing Senior Notes Obligations. Unless it has actual knowledge (including
by way of written notice from a Secured Creditor) to the contrary, the
Administrative 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 no Credit Document Obligations other than principal,
interest and regularly accruing fees are owing to any Lender Creditor.
(e) It is understood and agreed that each Pledgor shall remain liable
to the extent of any deficiency between (x) the amount of the Obligations for
which it is responsible directly
-20-
or as a Guarantor that are satisfied with proceeds of the Collateral and (y)
the aggregate outstanding amount of such 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 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. Each Pledgor jointly and severally agrees (i) to
indemnify and hold harmless the Pledgee and each other Secured Creditor and
their respective successors, assigns, employees, agents and affiliates
(individually an "Indemnitee," and collectively the "Indemnitees") 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 each Indemnitee for all reasonable costs and expenses, including
reasonable attorneys' fees, in each case growing out of or resulting from this
Agreement or the exercise by any Indemnitee of any right or remedy granted to it
hereunder or under any other Secured Debt Agreement (but excluding any claims,
demands, losses, judgments and liabilities or expenses to the extent incurred by
reason of gross negligence or willful misconduct of such Indemnitee (as
determined by a court of competent jurisdiction in a final and non-appealable
decision)). 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 or other
property actually received by it in accordance with the terms hereof. If and to
the extent that the obligations of any 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. PLEDGEE NOT BOUND. (a) Nothing herein shall be construed to make
the Pledgee or any other Secured Creditor liable as a general partner or limited
partner of any Pledged Partnership or a member of any Pledged LLC or a
shareholder of any corporation and the Pledgee or any other Secured Creditor by
virtue of this Agreement or otherwise (except as referred to in the following
sentence) shall not have any of the duties, obligations or liabilities of a
general partner or limited partner of any Pledged Partnership or a member of any
Pledged LLC or a shareholder of any corporation. The parties hereto expressly
agree that, unless the Pledgee shall become the absolute owner of the respective
Pledged Partnership Interest, Pledged Limited Liability Company Interest or
Security pursuant hereto, this Agreement shall not be construed as creating a
partnership or joint venture among the Pledgee, any other Secured Creditor
and/or any Pledgor.
(b) Except as provided in the last sentence of paragraph (a) of this
Section, the Pledgee, by accepting this Agreement, did not intend to become a
general partner or limited partner of any Pledged Partnership or a member of any
Pledged LLC or a shareholder of any corporation or otherwise be deemed to be a
co-venturer with respect to any Pledgor, any Pledged Partnership or any Pledged
LLC or a shareholder of any corporation. either before or after an Event of
Default under the Credit Agreement shall have occurred. The Pledgee shall have
only
-21-
those powers set forth herein and shall assume none of the duties, obligations
or liabilities of a general partner or limited partner of any Pledged
Partnership or a member of any Pledged LLC or a shareholder or of any
corporation or of any Pledgor.
(c) Neither the Pledgee nor any other Secured Creditor shall be
obligated to perform or discharge any obligation of any Pledgor as a result of
the collateral assignment hereby effected.
(d) The acceptance by the Pledgee of this Agreement, with all the
rights, powers, privileges and authority so created, shall not at any time or in
any event obligate the Pledgee to appear in or defend any action or proceeding
relating to the Collateral to which it is not a party, or to take any action
hereunder or thereunder, or to expend any money or incur any expenses or perform
or discharge any obligation, duty or liability under the Collateral.
13. FURTHER ASSURANCES. (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 Uniform Commercial Code such financing statements, continuation
statements and other documents in such offices as the Pledgee may reasonably
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
hereunder 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 reasonably 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 or thereunder.
(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 reasonable
discretion to take any action and to execute any instrument which the Pledgee
may reasonably deem necessary or advisable to accomplish the purposes of this
Agreement.
14. THE PLEDGEE AS COLLATERAL 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 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 Annex M to the Security
Agreement, the terms of which shall be deemed incorporated herein by reference
as fully as if same were set forth herein in their entirety (for such purpose,
treating each reference to the "Security Agreement" as a reference to this
Agreement, each reference to the "Collateral Agent" as a reference to the
Pledgee and each reference to an "Assignor" as a reference to a "Pledgor").
15. TRANSFER BY THE PLEDGORS. No Pledgor will sell or otherwise dispose
of, grant any option with respect to, or mortgage, pledge or otherwise encumber
any of
-22
the Collateral or any interest therein if prohibited by the terms of this
Agreement or any other Secured Debt Agreement.
16. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS. (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 Collateral consisting of one or more
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 and Permitted Liens;
(ii) it has full power, authority and legal right to pledge
all the Collateral pledged by it pursuant to this Agreement without the
consent of any other Person;
(iii) this Agreement has been duly authorized, executed and
delivered by such Pledgor and constitutes a legal, valid and binding
obligation of such Pledgor enforceable in accordance with its terms,
except to the extent that the enforceability hereof 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
law);
(iv) except to the extent already made or obtained, no consent
of any other party (including, without limitation, any stockholder,
member, limited or general partner or creditor of such Pledgor or any
of its Subsidiaries) and no consent, license, permit, approval or
authorization of, exemption by, notice or report to, or registration,
filing or declaration with, any governmental authority is required to
be obtained by such Pledgor in connection with (a) the execution,
delivery or performance of this Agreement, (b) the validity or
enforceability of this Agreement, (c) the perfection or enforceability
of the Pledgee's security interest in the Collateral (other than with
respect to the Stock of an Excluded Foreign Entity or (d) except for
compliance with or as may be required by applicable securities laws,
the exercise by the Pledgee of any of its rights or remedies provided
herein;
(v) neither the execution, delivery or performance of this
Agreement or any other Secured Debt Agreement to which it is a party
violates (a) any material provision of any applicable law or regulation
or of any order, judgment, writ, award or decree of any court,
arbitrator or domestic or foreign governmental authority, (b) the
certificate of incorporation, certificate of formation, certificate of
partnership, partnership agreement, limited liability company agreement
(or equivalent organizational documents) or by-laws, as the case may
be, of such Pledgor or of any securities issued by such Pledgor or any
of its Subsidiaries, or (c) any indenture, mortgage, lease, deed of
trust, credit agreement, loan agreement, agreement or other instrument
to which such Pledgor or any of its Subsidiaries is a party or which
purports to be binding upon such Pledgor or any of its Subsidiaries or
upon any of their respective assets and will not result in the creation
or imposition of any lien or encumbrance on any of the assets of such
Pledgor or any of its Subsidiaries except as contemplated by this
Agreement;
-23-
(vi) all the Collateral consisting of Securities, Pledged
Limited Liability Company Interests and Pledged Partnership Interests
have been duly and validly issued, are fully paid and non-assessable
and are subject to no options to purchase or similar rights;
(vii) to Pledgor's knowledge, each of the Pledged Notes
constitute, or, when executed by the obligor thereof, will constitute,
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 law);
(viii) the pledge, assignment and delivery to the Pledgee of
the Collateral consisting of Certificated Securities (other than the
Certificated Securities (x) of the Excluded Foreign Entities and (y)
required to be pledged pursuant to the procedures set forth in Section
3.2(a)(iii)) and Pledged Notes pursuant to this Agreement, creates a
valid and perfected first security interest in such Collateral and the
proceeds thereof, subject to no prior Lien or encumbrance or to any
agreement purporting to grant to any third party a Lien or encumbrance
on the property or assets of such Pledgor which would include the
Securities;
(ix) it is not in default in the payment of any portion of any
mandatory capital contribution, if any, required to be made under any
partnership agreement or limited liability company agreement to which
such Pledgor is a party, and such Pledgor is not in violation of any
other material provisions of any partnership agreement or limited
liability company agreement to which such Pledgor is a party, or
otherwise in default or violation thereunder; no Partnership Interest
or Limited Liability Company Interest is subject to any defense, offset
or counterclaim, nor have any of the foregoing been asserted or alleged
against such Pledgor by any Person with respect thereto;
(x) it shall not withdraw as a partner of any Pledged
Partnership or member of any Pledged LLC, or file or pursue or take any
action which may, directly or indirectly, cause a dissolution or
liquidation of or with respect to any Pledged Entity or seek a
partition of any property of any Pledged Entity, except as permitted by
the Credit Agreement;
(xi) the Pledged Partnership Interests or Pledged Limited
Liability Company Interests of such Pledgor, as the case may be,
constitute, and will at all times hereafter continue to constitute, in
the aggregate, all of the partnership interests or membership
interests, as the case may be, of each Pledged Entity of such Pledgor
and no Pledged Entity shall create any options or rights or other
agreements to sell or otherwise transfer, or sell or otherwise
transfer, any Partnership Interests or Limited Liability Company
Interests;
(xii) each partnership agreement and limited liability company
agreement is the legal, valid and binding obligation of the parties
thereto, enforceable in accordance with
-24-
its terms and, together with this Agreement, contains the entire
agreement between the parties thereto relating to the subject matter
thereof; and
(xiii) "control" (as defined in Section 8-106 of the UCC) has
been obtained by the Pledgee over all Collateral consisting of
Securities (including Notes which are Securities) with respect to which
such "control" may be obtained pursuant to Section 8-106 of the UCC, in
each such case to the extent required by the terms of this Agreement.
(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; and each
Pledgor 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 other Secured Creditors.
(c) Each Pledgor covenants and agrees that it will take no action which
would violate or be inconsistent with any of the terms of any Secured Debt
Agreement, or which would have the effect of impairing the position or interests
of the Pledgee or any other Secured Creditor under any Secured Debt Agreement
except as permitted by the Credit Agreement.
(d) Any Pledgor which owns an equity interest in an Excluded Foreign
Entity covenants and agrees that on the date on which such entity ceases to
qualify as an "Excluded Foreign Entity" in accordance with the definition
thereof, (i) such Pledgor shall have duly authorized, executed and delivered to
the Pledgee a pledge agreement, in form and substance satisfactory to the
Pledgee, governed by the laws of the jurisdiction of organization of such
Excluded Foreign Entity and covering (subject to the pledge limitations in
subclause (ii) of the definition of the term "Stock") the equity interests of
such Excluded Foreign Entity owned by such Pledgor (as amended, restated,
modified and/or supplemented from time to time in accordance with the terms
thereof and of the Credit Agreement, each such pledge agreement, a "Foreign
Pledge Agreement"), (ii) such Foreign Pledge Agreement shall be in full force
and effect and shall have been duly recorded or filed in such manner and in such
places as required by the law of the jurisdiction governing such Foreign Pledge
Agreement to establish, perfect, preserve and protect the pledge in favor of the
Collateral Agent, (iii) all taxes, fees and other charges payable in connection
with the such Foreign Pledge Agreement (including the recordation thereof) shall
have been paid in full and (iv) the Pledgee shall have received such other
evidence that all actions necessary or, in the opinion of the Pledgee,
desirable, to perfect and/or render enforceable the security interest purported
to be created by such Foreign Pledge Agreement have been taken (including,
without limitation, the delivery of an opinion from local counsel acceptable to
the Pledgee in form, scope and substance reasonably satisfactory to the
Pledgee).
(e) Each Pledgor represents and warrants as of the date of each Credit
Event under the Credit Agreement, that the fair market value of the Margin Stock
held by the Pledgors as of the date of such Credit Event does not exceed
$50,000,000.
17. PLEDGORS' OBLIGATIONS ABSOLUTE, ETC. The obligations of each
Pledgor under this Agreement shall be absolute and unconditional and shall
remain in full force
-25-
and effect without regard to, and shall not be released, suspended, discharged,
terminated 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 of the Secured Debt
Agreements, 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.
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 respective
Pledgor, will execute and deliver to such Pledgor a proper instrument or
instruments acknowledging the satisfaction and termination of this Agreement as
provided above, and will duly assign, transfer and deliver to such 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, together
with any moneys at the time held by the Pledgee hereunder. As used in this
Agreement, (i) "CA Termination Date" shall mean the date upon which the Total
Commitment has been terminated, no Letter of Credit or Note under the Credit
Agreement is outstanding and all other Credit Document Obligations have been
paid in full in cash (other than arising from indemnities for which no request
for payment has been made) and (ii) "Termination Date" shall mean the date upon
which (x) the CA Termination Date shall have occurred and (y) if (but only if) a
Notified Non-Credit Agreement Event of Default shall have occurred and be
continuing on the CA Termination Date (and after giving effect thereto), either
(I) such Notified Non-Credit Agreement Event of Default shall have been cured or
waived by the requisite holders of the relevant Obligations subject to such
Notified Non-Credit Agreement Event of Default or (II) all Secured Hedging
Agreements (if any) giving rise to a Notified Non-Credit Agreement Event of
Default shall have been terminated and all Obligations subject to such Notified
Non-Credit Agreement Event of Default shall have been paid in full (other than
arising from indemnities for which no request for payment has been made).
-26-
(b) So long as no Notified Non-Credit Agreement Event of Default has
occurred and is continuing, in the event that (x) prior to the CA Termination
Date (i) any part of the Collateral is sold or otherwise disposed of in
connection with a sale or other disposition permitted by Section 8.02 of the
Credit Agreement (it being agreed for such purposes that a release will be
deemed "permitted by Section 8.02 of the Credit Agreement" if the proposed
transaction constitutes an exception to Section 8.02 of the Credit Agreement) or
(ii) all or any part of the Collateral is released at the direction of the
Required Lenders (or all the Lenders if required by Section 12.12 of the Credit
Agreement), and the proceeds of such sale or disposition or from such release
(if any) are applied in accordance with the terms of the Credit Agreement to the
extent required to be so applied or (y) on and after the CA Termination Date,
any part of the Collateral is sold or otherwise disposed of without violating
the New Senior Notes Documents, the Refinancing Senior Notes Documents and the
Secured Hedging Agreements, the Pledgee, at the request and expense of the
respective Pledgor will release such Collateral from this Agreement, duly
assign, transfer and deliver to such Pledgor (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 (it being understood and
agreed that upon the release of all or any portion of the Collateral by the
Collateral Agent at the direction of the Lenders as provided above, the Lien on
the Collateral in favor of the Hedging Creditors, the New Senior Notes Creditors
and the Refinancing Senior Notes Creditors shall automatically be released).
(c) In addition to the foregoing, all Collateral shall be automatically
released (subject to reinstatement upon the occurrence of a new Trigger Event,
with each date of such reinstatement, a "Subsequent Effective Date") in
accordance with the provisions of the last sentence of Section 7.11(b) of the
Credit Agreement.
(d) At any time that the relevant Pledgor desires that the Pledgee take
any action to give effect to any release of Collateral pursuant to the foregoing
Section 18(a), (b) or (c), it shall deliver to the Pledgee a certificate signed
by an authorized officer describing the Collateral to be released and certifying
its entitlement to a release pursuant to the applicable provisions of Sections
18(b) or (c) and in such case the Pledgee, at the request and expense of such
Pledgor, will execute such documents as required to duly release such Collateral
and to assign, transfer and deliver to such Pledgor or its designee (without
recourse and without any representation or warranty) such of the Collateral as
is then being released and as may be in the possession of the Pledgee. The
Pledgee shall have no liability whatsoever to any other Secured Creditor as the
result of any release of Collateral by it in accordance with (or which the
Pledgee in the absence of gross negligence or willful misconduct believes to be
in accordance with) this Section 18. Upon any release of Collateral pursuant to
Section 18(a), (b) or (c), so long as no Noticed Event of Default is then in
existence, none of the Secured Creditors shall have any continuing right or
interest in such Collateral, or the proceeds thereof (subject to reinstatement
rights upon the occurrence of a new Trigger Event in the case of a release
pursuant to Section 18(c)(i)).
19. NOTICES, ETC. All notices and other communications provided for
hereunder shall be in writing (including telegraphic, telex, facsimile
transmission or cable communication) and mailed, telegraphed, telexed,
telecopied, cabled or delivered (including by way of overnight courier):
-27-
(i) if to any Pledgor, at its address set forth opposite its
signature below;
(ii) if to the Pledgee, at:
JPMorgan Chase Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
(iii) if to any Lender (other than the Pledgee), at such
address as such Lender shall have specified in the Credit Agreement;
(iv) if to any Hedging Creditor, at such address as such
Hedging Creditor shall have specified in writing to the Pledgors and
the Pledgee;
(v) if to any New Senior Notes Creditor, at such address of
the New Senior Notes Trustee as the New Senior Notes Trustee shall have
specified in writing to the Pledgors and the Pledgee;
(vi) if to any Refinancing Senior Notes Creditor, at such
address of the Refinancing Senior Notes Trustee as the Refinancing
Senior Notes Trustee 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. Except as
otherwise expressly provided herein, all such notices and communications shall
be deemed to have been duly given or made when received.
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 the Pledgee (with the consent of (x) if prior
to the CA Termination Date, the Required Lenders or, to the extent required by
Section 12.12 of the Credit Agreement, all of the Lenders and (y) if on and
after the CA Termination Date, the holders of at least a majority of the
outstanding principal amount of the Obligations remaining outstanding), and each
Pledgor affected thereby (it being understood that the addition or release of
any Pledgor hereunder shall not constitute a change, waiver, discharge or
variance affecting any Pledgor other than the Borrower and the Pledgor so added
or released), provided that any change, waiver, modification or variance
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 "Class" shall mean each class of Secured
Creditors, i.e., whether (w) the Lender Creditors as holders of the Credit
Document Obligations, (x) the Hedging Creditors as holders of the Hedging
Obligations, (y) the New Senior Notes Creditors as holders of the New Senior
Notes Obligations, and (z) the Refinancing Senior Notes Creditors as holders of
the Refinancing Senior Notes Obligations. For the purpose of this Agreement, the
term "Requisite Creditors" of any Class shall mean each of (w) with respect to
each of the Credit Document Obligations, the Required
-28-
Lenders, (x) with respect to the Hedging Obligations, the holders of at least a
majority of all Secured Hedging Obligations outstanding from time to time, (y)
with respect to the New Senior Notes Obligations, the holders of at least a
majority of the outstanding principal amount of the New Senior Notes, and (z)
with respect to the Refinancing Senior Notes Obligations, the holders of at
least a majority of the outstanding principal amount of the Refinancing Senior
Notes.
21. MISCELLANEOUS. This Agreement shall create a continuing security
interest in the Collateral and shall (i) remain in full force and effect,
subject to release and/or termination as set forth in Section 18, (ii) be
binding upon each Pledgor, its successors and assigns, and (iii) inure, together
with the rights and remedies of the Pledgee hereunder, to the benefit of the
Pledgee, the other Secured Creditors and their respective successors,
transferees and assigns. This Agreement shall be construed and enforced 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 party hereto irrevocably waives 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. ADDITIONAL PLEDGORS. It is understood and agreed that any
Subsidiary of the Borrower that is required to become a party to this Agreement
after the date hereof pursuant to the requirements of the Credit Agreement shall
become a Pledgor hereunder by (x) executing a counterpart hereof and/or an
assumption agreement, in each case in form and substance satisfactory to the
Collateral Agent, (y) delivering supplements to Annexes A through E hereto, as
are necessary to cause such Annexes to be complete and accurate with respect to
such additional Pledgor on such date and (z) taking all actions as specified in
this Agreement, in each case with all documents required above to be delivered
to the Collateral Agent and with all documents and action required above to be
taken to the reasonable satisfaction of the Collateral Agent.
24. NO THIRD PARTY BENEFICIARIES. This Agreement is entered into solely
for the benefit of the parties hereto and their respective successors and
assigns and for the benefit of the Secured Creditors from time to time and their
respective successors and assigns and, except for the Secured Creditors and
their successors and assigns, there shall be no third party beneficiaries
hereof, nor shall any Person other than the parties hereto and their respective
successors and assigns, and the Secured Creditors and their respective
successors and assigns, be entitled to enforce the provisions hereof or have any
claims against any party hereto (or any Secured Creditor) or their successors
and assigns arising from, or under, this Agreement.
* * *
-29-
IN WITNESS WHEREOF, each Pledgor and the Pledgee have caused this
Agreement to be executed and delivered by their duly authorized officers as of
the date first above written.
▇.▇. ▇▇▇▇▇▇▇▇ TOBACCO HOLDINGS INC.,
as a Pledgor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: SVP and Treasurer
▇.▇. ▇▇▇▇▇▇▇▇ TOBACCO COMPANY,
as a Pledgor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: SVP and Treasurer
RJR ACQUISITION CORP.,
as a Pledgor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: VP and Treasurer
GMB, INC.,
as a Pledgor
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
FHS, INC.,
as a Pledgor
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
-30-
▇.▇. ▇▇▇▇▇▇▇▇ TOBACCO CO.,
as a Pledgor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title:
SANTA FE NATURAL TOBACCO COMPANY, INC.,
as a Pledgor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: SVP, General Counsel and Secretary
RJR PACKAGING, LLC,
as a Pledgor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title:
-31-
Acknowledged And Agreed:
JPMORGAN CHASE BANK,
as Collateral Agent and Pledgee
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Managing Director
-32-
Annexes to Pledge Agreement
Annex A List of Subsidiaries
Annex B List of Stock
Annex C List of Notes
Annex D Limited Liability Company Interests
Annex E List of Partnership Interests
Annex F Form of Agreement Regarding Uncertificated Securities, Limited
Liability Company Interests and Partnership Interests
Annex G Miscellaneous Investments
-33-