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Exhibit 2.k.(iv)
COLLATERAL AGREEMENT
Among
[Selling Shareholder],
As Pledgor,
[ ,] As Collateral Agent
and
SECOND AUTOMATIC COMMON EXCHANGE
SECURITY TRUST
Dated as of
___________, 1997
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The following Table of Contents has been inserted for convenience of
reference only and does not constitute a part of the Collateral Agreement.
TABLE OF CONTENTS
SECTION PAGE
1. The Security Interests.............................................. 1
2. Definitions......................................................... 2
3. Representations and Warranties of the Pledgor....................... 6
4. Representations and Warranties of the Collateral
Agent............................................................... 7
5. Certain Covenants of the Pledgor.................................... 7
6. Administration of the Collateral and Valuation of
the Securities...................................................... 8
7. Income and Voting Rights on Collateral.............................. 14
8. Remedies upon Events of Default..................................... 15
9. The Collateral Agent................................................ 18
10. Miscellaneous....................................................... 21
11. Termination of Collateral Agreement................................. 22
12. No Personal Liability of Trustees................................... 22
Exhibit A - Certificate for Substituted Collateral
Exhibit B - Certificate for Additional Collateral
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COLLATERAL AGREEMENT
THIS COLLATERAL AGREEMENT (the "Agreement"), dated as of __________,
1997, among [Selling Shareholder] (the "Pledgor"), [_______________, a
_______________,] as collateral agent (the "Collateral Agent") hereunder for the
benefit of Second Automatic Common Exchange Security Trust, a trust duly created
under the laws of the State of New York (such trust and the trustees thereof
acting in their capacity as such being referred to herein as the "Trust" or
"Purchaser");
WITNESSETH:
WHEREAS, pursuant to the Purchase Agreement (the "Purchase Agreement"),
dated as of ___________, 1997, between the Pledgor and Purchaser, the Pledgor
has agreed to sell and Purchaser has agreed to purchase Common Stock, without
par value (the "Common Stock"), of ____________, a _________ corporation (the
"Company"), subject to the terms and conditions of the Purchase Agreement; and
NOW, THEREFORE, to secure the performance by the Pledgor of its
obligations under the Purchase Agreement and to secure the observance and
performance of the covenants and agreements contained herein and in the Purchase
Agreement, the parties hereto agree as follows:
1. The Security Interests.
In order to secure the observance and performance of the covenants and
agreements contained herein and in the Purchase Agreement:
(a) Effective upon and subject to the receipt by Pledgor of the Firm
Purchase Price at the First Time of Delivery, the Pledgor hereby grants, sells,
conveys, assigns, transfers and pledges unto the Collateral Agent, as agent of
and for the benefit of the Trust, a security interest in and to, and a lien upon
and right of set-off against, all of his right, title and interest in and to (i)
the Pledged Items described in paragraph (b); (ii) all additions to and
substitutions for such Pledged Items; (iii) all income, proceeds and collections
received or to be received, or derived or to be derived, now or any time
hereafter from or in connection with the Pledged Items; and (iv) all powers and
rights now owned or hereafter acquired under or with respect to the Pledged
Items (such Pledged Items, additions, substitutions, proceeds, collections,
powers and rights being herein collectively called the
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"Collateral"). The Collateral Agent shall have all of the rights, remedies and
recourses with respect to the Collateral afforded a secured party by the New
York Uniform Commercial Code, in addition to, and not in limitation of, the
other rights, remedies and recourses afforded to the Collateral Agent by this
Agreement.
(b) At the First Time of Delivery, the Pledgor shall deliver to the
Collateral Agent in pledge hereunder (i) ___________ shares of the Common Stock
and (ii) Extension Strips having the terms set forth in Schedule I to the
Purchase Agreement, in each case registered in the name of the Collateral Agent
or its nominee.
(c) Effective upon and subject to the receipt by the Pledgor of the
Additional Purchase Price, at the Second Time of Delivery, the Pledgor shall
deliver to the Collateral Agent in pledge hereunder (i) Common Stock
representing the Additional Share Base Amount of Common Stock and (ii) Extension
Strips having the terms set forth in Schedule I to the Purchase Agreement, in
each case registered in the name of the Collateral Agent or its nominee.
2. Definitions.
Capitalized terms used and not otherwise defined herein shall have the
meanings ascribed to them in the Purchase Agreement. Capitalized terms used
herein shall have the meanings as follows:
"Authorized Representative" of the Pledgor means any trustee or other
representative as to whom Pledgor shall have delivered notice to the Collateral
Agent that such trustee or other representative is authorized to act hereunder
on behalf of Pledgor.
"Business Day" means any day except a Saturday, Sunday or other day on
which banking institutions in New York City are authorized or obligated by law
or regulation to close or a day on which the New York Stock Exchange, Inc. is
closed.
"Cash Delivery Obligations" means, at any time (A) if no Reorganization
Event shall have occurred prior to such time, zero, and (B) from and after any
Reorganization Event, the Dilution Adjustment that shall have been applied to
the Exchange Rate pursuant to Section 6.1 of the Purchase Agreement at or prior
to the Reorganization Event, times the product of: (i) the Firm Share Base
Amount plus the Additional Share Base Amount (if any); and (ii) the Transaction
Value of any property other than Marketable
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Securities received by the Pledgor in such Reorganization Event.
"Collateral" has the meaning specified in Section 1(a).
"Collateral Agent" means the financial institution identified as such
in the preliminary paragraph hereof, or any successor appointed in accordance
with Section 9.
"Collateral Agreement" means this Collateral Agreement and any exhibits
hereto.
"Collateral Event of Default" has the meaning specified in Section
6(e).
"Collateral Requirement" means, as of any date and with respect to: (i)
any Common Stock, 100%; (ii) any Marketable Securities, 100%; (iii) any U.S.
Government Securities pledged in respect of Cash Delivery Obligations, 105%; and
(iv) any other U.S. Government Securities, 150%, provided that upon and after
any failure to cure an Insufficiency Determination by 4:00 p.m. New York City
time on the tenth Business Day following telephonic notice of such Insufficiency
Determination as described in Section 6(e), which insufficiency shall be
continuing on such tenth business day, the Collateral Requirement relating to
any U.S. Government Securities shall be 200%. The portion of any pledged U.S.
Government Securities that shall be deemed at any time to be in respect of Cash
Delivery Obligations shall be as provided in Section 6(e).
"Eligible Collateral" means (i) Common Stock, (ii) U.S. Government
Securities, and (iii) from and after any Reorganization Event, Marketable
Securities, provided, in each case, that the Pledgor has good and marketable
title thereto, free of all Liens (other than the Liens created by this
Collateral Agreement) and Transfer Restrictions and that the Collateral Agent
has a valid, first priority perfected security interest therein and first lien
thereon, and provided further that to the extent the number of shares of
Marketable Securities pledged hereunder exceeds at any time the Maximum
Deliverable Number thereof, such excess shares shall not be Eligible Collateral.
"Event of Default" means the occurrence of: (i) an event described in
clause (a) or (b) of Article VII of the Purchase Agreement, (ii) a Collateral
Event of Default, (iii) a failure by Pledgor to have caused the Collateral to
meet the requirements described in Section 5(d) on the Exchange Date or (iv) if
a Reorganization Event shall have occurred prior to the Exchange Date, failure
by Pledgor to cause to be delivered to Purchaser on the Exchange Date the
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consideration then required to be delivered pursuant to Section 6.2 of the
Purchase Agreement.
"Extension Strips" means the U.S. Treasury obligations pledged by the
Seller pursuant to Section 1(b) at the First Time of Delivery, and Section 1(c)
at the Second Time of Delivery, as appropriate, having the terms set forth on
Schedule I to the Purchase Agreement. The Extension Strips (i) shall not secure
the Pledgor's obligations under the Purchase Agreement and (ii) shall not be
applied towards satisfaction of the Collateral Requirement.
"Ineligible Collateral" means Collateral that does not constitute
"Eligible Collateral".
"Lien" means any lien, mortgage, security interest, pledge, charge or
encumbrance of any kind.
"Market Value" means, as of any date: (a) with respect to any Common
Stock (except as otherwise provided in Section 6(e)(2)), the Closing Price on
such date; (b) with respect to any U.S. Government Security, the product of
(x)(i) the average unit bid price for such security as published on the Trading
Day prior to such date in the New York edition of The Wall Street Journal or The
New York Times or, if not so published, (ii) the lower bid price quoted (which
quotation shall be evidenced in writing) on the Trading Day prior to such date
by either of two nationally recognized dealers making a market in such security
which are members of the National Association of Securities Dealers, Inc. and
(y) the number of such units comprised in the outstanding principal amount of
such security; and (c) with respect to any share of Marketable Securities, the
Closing Price thereof on the Trading Day prior to such date; provided that the
"Market Value" of any Ineligible Collateral shall be zero.
"Maximum Deliverable Number" means, on any date, with respect to the
Common Stock, the product of the Firm Share Base Amount plus the Additional
Share Base Amount (if any), multiplied successively by each number by which the
Exchange Rate shall have been multiplied on or prior to such date pursuant to
the adjustments provided for under Section 6.1 of the Purchase Agreement. The
Maximum Deliverable Number of Marketable Securities means, on any date, the
product of (i) the Firm Share Base Amount plus the Additional Share Base Amount
(if any) and (ii) the number of Marketable Securities received by the Pledgor in
the Reorganization Event for each share of Common Stock, multiplied successively
by each number by which the Exchange Rate shall have been multiplied on or prior
to such date and after the date of such Reorganization Event pursuant to the
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adjustments provided for under Article VI of the Purchase Agreement.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Pledge Value" means, as of any date and with respect to any particular
type of Collateral, an amount equal to the aggregate Market Value of such
Collateral divided by the Collateral Requirement for such Collateral.
"Pledge Value Requirement" means, as of any date, (a) the aggregate
Market Value on such date of the Maximum Deliverable Number of shares of Common
Stock on such date or, from and after a Reorganization Event, Marketable
Securities, plus (b) from and after a Reorganization Event, the Cash Delivery
Obligations.
"Pledged Items" means, as of any date, any and all securities and
instruments delivered by the Pledgor to be held by the Collateral Agent under
this Collateral Agreement as Collateral, whether Eligible Collateral or
Ineligible Collateral.
"Prior Collateral" has the meaning specified in Section 6(b)(1).
"Responsible Officer" means, when used with respect to the Collateral
Agent, any vice president, assistant vice president, assistant treasurer or
assistant secretary located in the division or department of the Collateral
Agent responsible for performing the obligations of the Collateral Agent under
this Collateral Agreement, or in any other division or department of the
Collateral Agent performing operations substantially equivalent to those
performed by such division or department pursuant hereto, or any other officer
of the Collateral Agent or any successor Collateral Agent customarily performing
functions similar to those performed by any of the aforesaid officers, and also
means, with respect to any matter relating to this Collateral Agreement or the
Collateral, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"Transfer Restriction" means, with respect to any item of Collateral,
any condition to or restriction on the ability of the holder thereof to sell,
assign or otherwise transfer such item of Collateral or to enforce the
provisions thereof or of any document related thereto whether set forth in such
item of Collateral itself or in any document related thereto, including, without
limitation,
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(i) any requirement that any sale, assignment or other transfer or enforcement
of such item of Collateral be consented to or approved by any Person, including,
without limitation, the issuer thereof or any other obligor thereon, (ii) any
limitations on the type or status, financial or otherwise, of any purchaser,
pledgee, assignee or transferee of such item of Collateral, (iii) any
requirement of the delivery of any certificate, consent, agreement, opinion of
counsel, notice or any other document of any Person to the issuer of, any other
obligor on or any registrar or transfer agent for, such item of Collateral,
prior to the sale, pledge, assignment or other transfer or enforcement of such
item of Collateral and (iv) any registration or qualification requirement for
such item of Collateral pursuant to any federal or state securities law;
provided that the required delivery of any assignment from the seller, pledgor,
assignor or transferor of such item of Collateral, together with any evidence of
the corporate or other authority of such Person, shall not constitute a
"Transfer Restriction."
"Trustee" or "Trustees" means any trustee or trustees of the Trust
identified on the signature pages hereto, or any successor as such trustee or
trustees.
"UCC" means the Uniform Commercial Code as in effect in the State of
New York.
"U.S. Government Securities" means direct obligations of the United
States of America that mature on a date that is one year or less from the date
such obligations are pledged hereunder, but in any event prior to the Exchange
Date.
3. Representations and Warranties of the Pledgor.
The Pledgor hereby represents and warrants to the Collateral Agent and
the Trust that:
(a) No Transfer Restrictions. No Transfer Restrictions exist with
respect to or otherwise apply to the assignment of, or transfer by the Pledgor
of possession of, any items of Collateral to the Collateral Agent hereunder, or
the subsequent sale or transfer of such items of Collateral by the Collateral
Agent pursuant to the terms hereof.
(b) Title to Collateral; Perfected Security Interest. The Pledgor has
good and marketable title to the Pledged Items, free of all Liens (other than
the Lien created by this Collateral Agreement) and Transfer Restrictions. Upon
delivery of the Collateral to the
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Collateral Agent hereunder, the Collateral Agent will obtain a valid, first
priority perfected security interest in, and a first lien upon, such Collateral
subject to no other Lien; none of such Collateral is or shall be pledged by the
Pledgor as collateral for any other purpose.
4. Representations and Warranties of the Collateral Agent.
The Collateral Agent represents and warrants to the Pledgor and the
Trust that:
(a) Corporate Existence and Power. The Collateral Agent is a banking
corporation, duly incorporated, validly existing and in good standing under the
laws of the jurisdiction of its incorporation, and has all corporate powers and
all material governmental licenses, authorizations, consents and approvals
required to enter into, and perform its obligations under, this Collateral
Agreement.
(b) Authorization and Non-Contravention. The execution, delivery and
performance by the Collateral Agent of this Collateral Agreement have been duly
authorized by all necessary corporate action on the part of the Collateral Agent
(no action by the shareholders of the Collateral Agent being required) and do
not and will not violate, contravene or constitute a default under any provision
of applicable law or regulation or of the charter or by-laws of the Collateral
Agent or of any material agreement, judgment, injunction, order, decree or other
instrument binding upon the Collateral Agent.
(c) Binding Effect. This Collateral Agreement constitutes a valid and
binding agreement of the Collateral Agent enforceable against the Collateral
Agent in accordance with its terms.
5. Certain Covenants of the Pledgor.
The Pledgor agrees that, so long as any of its obligations under the
Purchase Agreement remain outstanding:
(a) Title to Collateral. The Pledgor shall at all times hereafter have
good and marketable title to the Collateral pledged by him, free of all Liens
(other than the Liens created by this Collateral Agreement) and Transfer
Restrictions, and, subject to the terms of this Collateral Agreement, will at
all times hereafter have good, right and lawful authority to assign, transfer
and pledge such Collateral and all such additions thereto and substitutions
therefor under this Collateral Agreement.
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(b) Pledge Value Requirement. The Pledgor shall cause the aggregate
Pledge Value of the Collateral to be equal to or greater than the Pledge Value
Requirement at all times, and shall pledge additional Collateral in the manner
described in Section 6(d) as necessary to cause such requirement to be met.
(c) Pledge upon Reorganization Event. Upon the occurrence of a
Reorganization Event, the Pledgor shall immediately cause to be delivered to the
Collateral Agent, in the manner provided in Section 6(d): (i) U.S. Government
Securities having any aggregate Market Value at least equal to 105% of the Cash
Delivery Obligations; and (ii) Marketable Securities in an amount at least equal
to the Maximum Deliverable Number thereof, or, at Pledgor's election, U.S.
Government Securities having an aggregate Market Value at least equal to 150% of
such Maximum Deliverable Number of Marketable Securities; in each case to be
held as substitute Collateral hereunder.
(d) Pledge of Purchase Agreement Consideration. Notwithstanding the
Pledgor's right to substitute Collateral pursuant to Section 6(b), the Pledgor
shall cause the Collateral to include, on the Exchange Date, unless a
Reorganization Event shall have occurred, a number of shares of Common Stock at
least equal to the number of shares of Common Stock required to be delivered
under the Purchase Agreement on the Exchange Date.
(e) Further Assurances. The Pledgor shall, at his expense and in such
manner and form as the Trust or the Collateral Agent may require, give, execute,
deliver, file and record any financing statement, notice, instrument, document,
agreement or other papers that may be necessary or desirable in order to create,
preserve, perfect, substantiate or validate any security interest granted
pursuant hereto or to enable the Collateral Agent to exercise and enforce its
rights and the rights of the Trust hereunder with respect to such security
interest. To the extent permitted by applicable law, the Pledgor hereby
authorizes the Collateral Agent to execute and file, in the name of the Pledgor
or otherwise, Uniform Commercial Code financing or continuation statements
(which may be carbon, photographic, photostatic or other reproductions of this
Agreement or of a financing statement relating to this Agreement) which the
Collateral Agent in its sole discretion may deem necessary or appropriate to
further perfect, or maintain the perfection of the security interests granted
hereby.
6. Administration of the Collateral and Valuation of the Securities.
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(a) Valuation of Collateral. The Collateral Agent shall determine on
each Business Day whether the Pledge Value is at least equal to the Pledge Value
Requirement and whether an Insufficiency Determination or Collateral Event of
Default shall have occurred and, from and after any substitution of U.S.
Government Securities for pledged Common Stock or Marketable Securities pursuant
to paragraph (b) of this Section 6, shall determine the Pledge Value on each
Business Day and shall provide written notice of the Pledge Value to the
Pledgor.
(b) Substitution of Collateral. The Pledgor may substitute Collateral
in accordance with the following provisions:
(1) Unless an Event of Default or a failure by the Pledgor to meet any
of its obligations under Section 5(b) or (c) hereof has occurred and is
continuing, the Pledgor shall have the right at any time and from time to
time to deposit Eligible Collateral with the Collateral Agent in
substitution for Pledged Items previously deposited hereunder ("Prior
Collateral") and to obtain the release from the Lien hereof of such Prior
Collateral.
(2) If a Pledgor wishes to deposit Eligible Collateral with the
Collateral Agent in substitution for Prior Collateral, he shall (i) give
written notice to the Collateral Agent identifying the Prior Collateral to
be released from the Lien hereof, (ii) deliver to the Collateral Agent
concurrently with such Eligible Collateral a certificate of an Authorized
Officer of the Pledgor substantially in the form of Exhibit A hereto and
dated the date of such delivery, (A) identifying the items of Eligible
Collateral being substituted for the Prior Collateral and the Prior
Collateral that is to be transferred to the Pledgor and (B) certifying that
the representations and warranties contained in such Exhibit A hereto are
true and correct on and as of the date thereof and (iii) deliver to the
Collateral Agent concurrently with such Eligible Collateral an opinion
(dated the date of such delivery) of counsel (who may be an employee of the
Pledgor) addressed to the Collateral Agent confirming the representations
contained in the second sentence of paragraph 3(b) of Exhibit A hereto. The
Pledgor hereby covenants and agrees to take all actions required under
Section 6(d) and any other actions necessary to create for the benefit of
the Collateral Agent a valid, first priority perfected security interest in,
and a
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first lien upon, such Eligible Collateral deposited with the Collateral
Agent in substitution for Prior Collateral.
(3) No such substitution shall be made unless and until the Collateral
Agent shall have determined that the aggregate Pledge Value of all of the
Collateral at the time of such proposed substitution, after giving effect to
the proposed substitution, shall at least equal the Pledge Value
Requirement.
(c) Additional Collateral. The Pledgor may pledge additional Collateral
hereunder at any time. Concurrently with the delivery of any additional Eligible
Collateral, the Pledgor shall deliver (i) a certificate of an Authorized Officer
of the Pledgor substantially in the form of Exhibit B hereto and dated the date
of such delivery, (A) identifying the additional items of Eligible Collateral
being pledged and (B) certifying that with respect to such items of additional
Eligible Collateral the representations and warranties contained in such Exhibit
B hereto are true and correct on and as of the date thereof and (ii) an opinion,
dated the date of such delivery, of counsel addressed to the Collateral Agent
confirming the representations contained in the second sentence of paragraph
2(b) of Exhibit B hereto. The Pledgor hereby covenants and agrees to take all
actions required under Section 6(d) and any other actions necessary to create
for the benefit of the Collateral Agent a valid, first priority perfected
security interest in, and a first lien upon, such additional Eligible
Collateral.
(d) Delivery of Collateral. The Pledgor shall deliver the Collateral to
the Collateral Agent in accordance with the following provisions:
(1) Pledged Common Stock. In the case of Collateral consisting of
Common Stock, by delivery to the Collateral Agent of Common Stock,
registered in the name of the Collateral Agent or its nominee;
(2) Pledged U.S. Government Securities. In the case of Collateral
consisting of U.S. Government Securities, by transfer thereof through the
Book Entry System of the Federal Reserve System to the account of the
Collateral Agent or to an account (other than an account of the Pledgor)
designated by the Collateral Agent; and
(3) Pledged Marketable Securities. In the case of Collateral consisting
of Marketable Securities, by delivery of certificates evidencing such
Marketable Securities, registered in the name of the Collateral
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Agent or its nominee or, if such Marketable Securities are not issuable
in certificated form but are held in book entry form by The Depository Trust
Company, by transfer to an account of the Collateral Agent or to an account
(other than an account of the Pledgor) designated by the Collateral Agent
with The Depository Trust Company. Each such delivery of Marketable
Securities shall be accompanied by an opinion of counsel satisfactory to the
Collateral Agent that the Collateral Agent has obtained a valid, first
priority perfected security interest in, and a first lien upon, such
Marketable Securities.
Upon delivery of any Pledged Item under this Collateral Agreement, the
Collateral Agent shall examine such Pledged Item and any opinions and
certificates delivered pursuant to Sections 6(b) or (c) or otherwise pursuant to
the terms hereof in connection therewith to determine that they comply as to
form with the requirements for Eligible Collateral. The Pledgor hereby
designates the Collateral Agent as the person in whose name any Collateral held
in book entry form in the Federal Reserve System shall be registered.
(e) Insufficiency Determination.
(1) If on any Business Day the Collateral Agent determines that the
aggregate Pledge Value of the Collateral is less than the Pledge Value
Requirement (any such determination, an "Insufficiency Determination"), the
Collateral Agent shall promptly notify the Pledgor of such determination by
telephone call to an Authorized Representative of the Pledgor followed by a
written confirmation of such call.
(2) If, by 4:00 p.m., New York City time on the tenth Business Day
following the day on which telephonic notice shall have been given pursuant to
the preceding paragraph (e)(1), the Pledgor shall have failed to deliver, in the
manner set forth in paragraphs (c) and (d) of this Section 6, sufficient
additional Eligible Collateral so that, after giving effect to such delivery,
the aggregate Pledge Value of the Collateral, as of such tenth business day, is
at least equal to the Pledge Value Requirement, then (x) the Collateral
Requirement with respect to any U.S. Government Securities pledged hereunder
(other than in respect of Cash Delivery Obligations) shall be increased from
150% to 200%, and (y) unless a Collateral Event of Default shall have occurred
and be continuing, the Collateral Agent shall:
(i) commence sales, in the manner described in paragraph (3) below, of
such portion of the Collateral consisting of U.S. Government Securities as
may be
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required to be sold in order to generate proceeds sufficient to
purchase Common Stock or, after a Reorganization Event, Marketable
Securities, as described in the following clause (ii); and
(ii) commence purchases, in the manner described in paragraph (3)
below, of Common Stock or, after a Reorganization Event, Marketable
Securities, in an amount sufficient to cause the aggregate Pledge Value of
the Collateral to be at least equal to the Pledge Value Requirement.
Notwithstanding the foregoing, the Collateral Agent shall discontinue sales and
purchases pursuant to the preceding clauses (i) and (ii), respectively, if at
any time a Collateral Event of Default shall have occurred and be continuing.
The Collateral Agent shall determine the Market Value and the Pledge Value of
the Collateral after each purchase of Common Stock or Marketable Securities
pursuant to the preceding clause (ii) in order to determine whether the Pledge
Value Requirement is met and whether a Collateral Event of Default has occurred.
Solely for purposes of such calculation, the Market Value of the Common Stock or
Marketable Securities shall be: (A) the most recent sales price as reported in
the composite transactions for the principal securities exchange on which the
Common Stock or Marketable Securities, as the case may be, are then listed or,
if such securities are not so listed, the last quoted ask price for such
securities in the over-the-counter market as reported by The NASDAQ National
Market or, if not so reported, by the National Quotation Bureau or a similar
organization; or (B) if higher, in the case of Common Stock, the most recent
available Closing Price.
A "Collateral Event of Default" shall mean, at any time, the occurrence
of any of the following: (A) failure of the aggregate Market Value of the
Collateral to equal or exceed the Pledge Value Requirement; (B) failure of the
Market Value of any U.S. Government Securities pledged at such time (not
including any U.S. Government Securities pledged in respect of Cash Delivery
Obligations at such time) to have an aggregate Market Value of at least 105% of
the Market Value of a number of shares of Common Stock (or, from and after any
Reorganization Event, Marketable Securities) equal to (x) the Maximum
Deliverable Number thereof minus (y) the number thereof pledged as Collateral
hereunder at such time; or (C) from and after any Reorganization Event, failure
of the U.S. Government Securities pledged in respect of Cash Delivery
Obligations to have an aggregate Market Value at least equal to 105% of the Cash
Delivery Obligations at such time, if, in the case of a failure described in
this clause (C), such failure shall continue to be in effect at 4:00 p.m., New
York City
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time, on the tenth Business Day following the day on which telephonic notice in
respect thereof shall have been given pursuant to paragraph (e)(1) above. For
purposes of this Agreement, the portion of any pledged U.S. Government
Securities that shall be deemed to be in respect of Cash Delivery Obligations at
any time shall be a portion having a Market Value equal to 105% of the Cash
Delivery Obligations at such time (or, if less, the aggregate Market Value of
all U.S. Government Securities pledged at such time).
(3) Collateral sold and Common Stock or shares of Marketable Securities
purchased by the Collateral Agent pursuant to the preceding paragraphs (e)(i)
and (ii) may be sold and purchased on any securities exchange or in any
over-the-counter market or in any private purchase transaction, and at such
price or prices, in each case as the Collateral Agent may deem satisfactory. The
Pledgor covenants and agrees that it will execute and deliver such documents and
take such other action as the Collateral Agent deems necessary or advisable in
order that any such sales and purchases may be made in compliance with law.
(f) Release of Excess Collateral. If on any Business Day the Collateral
Agent determines that the aggregate Pledge Value of the Pledgor's Eligible
Collateral exceeds the Pledge Value Requirement and no Event of Default or
failure by the Pledgor to meet any of its obligations under Sections 5 or 6
hereof has occurred and is continuing, the Pledgor may obtain the release from
the Lien hereof of any Collateral having an aggregate Pledge Value on such
Business Day less than or equal to such excess, upon delivery to the Collateral
Agent of a written notice from an Authorized Representative of the Pledgor
indicating the items of Collateral to be released. Such Collateral shall be
released only after the Collateral Agent shall have determined that the
aggregate Pledge Value of all of the Collateral remaining after such release as
determined on such Business Day is at least equal to the Pledge Value
Requirement.
(g) Delivery of Purchase Agreement Consideration. On the Exchange Date,
unless a Reorganization Event shall have occurred prior thereto, the Collateral
Agent shall deliver to the Trust Common Stock then held by it hereunder
representing the number of shares of Common Stock then required to be delivered
under the Purchase Agreement. If a Reorganization Event shall have occurred
prior to the Exchange Date, then, if so instructed by the Pledgor by the close
of business on the Business Day preceding the Exchange Date, the Collateral
Agent shall deliver to the Trust, to the extent permitted to be delivered in
lieu of cash required to be delivered on such date under Section 6.2 of the
Purchase Agreement, the Marketable Securities then held
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by the Collateral Agent hereunder. Upon such delivery, the Trust shall hold such
Common Stock or Marketable Securities, as the case may be, absolutely and free
from any claim or right whatsoever.
(h) Release of Extension Strips. Upon notice of extension of the
Exchange Date as provided for in the Purchase Agreement, the Collateral Agent
shall release the Extension Strips to the Custodian for the benefit of the
Trust.
[(i) Investment of Cash Collateral. The Collateral Agent shall invest
any cash received by it pursuant to Section 6.2 of the Purchase Agreement in
[Qualified Deposits] [U.S. Treasury Securities maturing on or before the
Exchange Date].]
7. Income and Voting Rights on Collateral.
(a) Unless an Event of Default or failure by the Pledgor to meet any of
his obligations under Section 5(b) or (c) hereof has occurred and is continuing,
the Pledgor shall be entitled to receive for his own account all dividends,
interest and, if any, principal and premium relating to all of the Collateral,
unless the payment thereof to the Pledgor or would reduce the aggregate Pledge
Value of the Collateral below the Pledge Value Requirement. The Collateral Agent
agrees to remit to the Pledgor on the Business Day received or the first
Business Day thereafter all such payments received by it. If an Event of Default
or failure by the Pledgor to meet any of its obligations under Section 5(b) or
(c) hereof has occurred and is continuing, all such payments made or accrued
after and during the continuance of such default or failure shall be retained by
the Collateral Agent, and any such payments which are received by the Pledgor
shall be received in trust for the benefit of the Trust, shall be segregated
from other funds of the Pledgor and shall forthwith be paid over to the
Collateral Agent. Any such payments so retained by, or paid over to, the
Collateral Agent shall be held by the Collateral Agent as Collateral hereunder.
(b) Unless an Event of Default has occurred and is continuing, the
Pledgor shall have the right, from time to time, to vote and to give consents,
ratifications and waivers with respect to the Collateral, and the Collateral
Agent shall, upon receiving a written request from the Pledgor, deliver to the
Pledgor or as specified in such request such proxies, powers of attorney,
consents, ratifications and waivers in respect of any of the Collateral which is
registered in the name of the Collateral Agent or its nominee as shall be
specified in such request
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and be in form and substance satisfactory to the Collateral Agent.
If an Event of Default shall have occurred and be continuing, the
Collateral Agent shall have the right to the extent permitted by law, and the
Pledgor shall take all such action as may be necessary or appropriate to give
effect to such right, to vote and to give consents, ratifications and waivers,
and take any other action with respect to any or all of the Collateral with the
same force and effect as if the Collateral Agent were the absolute and sole
owner thereof.
8. Remedies upon Events of Default.
(a) If any Event of Default shall have occurred and be continuing, the
Collateral Agent may exercise on behalf of the Trust all the rights of a secured
party under the Uniform Commercial Code (whether or not in effect in the
jurisdiction where such rights are exercised) and, in addition, without being
required to give any notice, except as herein provided or as may be required by
mandatory provisions of law, shall: (i) deliver all Collateral consisting of
Common Stock or Marketable Securities (but not, in either case, in excess of the
number of shares thereof deliverable under the Purchase Agreement at such time)
to the Trust on the date of the Acceleration Notice relating to such Event of
Default (or, in the case of an Event of Default described in clause (iii) or
(iv) of the definition thereof, on the Exchange Date) (in either case, the
"Delivery Date"), whereupon the Trust shall hold such Common Stock or Marketable
Securities absolutely free from any claim or right of whatsoever kind, including
any equity or right of redemption of the Pledgor which may be waived, and the
Pledgor, to the extent permitted by law, hereby specifically waives all rights
of redemption, stay or appraisal which he has or may have under any law now
existing or hereafter adopted; and (ii) if such delivery shall be insufficient
to satisfy in full all of the obligations of Pledgor under the Purchase
Agreement, sell all of the remaining Collateral, or such lesser portion thereof
as may be necessary to generate proceeds sufficient to satisfy in full all of
the obligations of Pledgor under the Purchase Agreement, at public or private
sale or at any broker's board or on any securities exchange, for cash, upon
credit or for future delivery, and at such price or prices as the Collateral
Agent may deem satisfactory. The Pledgor covenants and agrees that he will
execute and deliver such documents and take such other action as the Collateral
Agent deems necessary or advisable in order that any such sale may be made in
compliance with law. Upon any such sale the Collateral Agent shall have the
right to deliver, assign and transfer to the purchaser thereof the Collateral so
sold.
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Each purchaser at any such sale shall hold the Collateral so sold absolutely and
free from any claim or right of whatsoever kind, including any equity or right
of redemption of the Pledgor which may be waived, and the Pledgor, to the extent
permitted by law, hereby specifically waives all rights of redemption, stay or
appraisal which he has or may have under any law now existing or hereafter
adopted. The notice (if any) of such sale required by Section 9 of the UCC shall
(1) in case of a public sale, state the time and place fixed for such sale, (2)
in case of sale at a broker's board or on a securities exchange, state the board
or exchange at which such sale is to be made and the day on which the
Collateral, or the portion thereof so being sold, will first be offered for sale
at such board or exchange, and (3) in the case of a private sale, state the day
after which such sale may be consummated. Any such public sale shall be held at
such time or times within ordinary business hours and at such place or places as
the Collateral Agent may fix in the notice of such sale. At any such sale the
Collateral may be sold in one lot as an entirety or in separate parcels, as the
Collateral Agent may determine. The Collateral Agent shall not be obligated to
make any such sale pursuant to any such notice. The Collateral Agent may,
without notice or publication, adjourn any public or private sale or cause the
same to be adjourned from time to time by announcement at the time and place
fixed for the sale, and such sale may be made at any time or place to which the
same may be so adjourned. In case of any sale of all or any part of the
Collateral on credit or for future delivery, the Collateral so sold may be
retained by the Collateral Agent until the selling price is paid by the
purchaser thereof, but the Collateral Agent shall not incur any liability in
case of the failure of such purchaser to take up and pay for the Collateral so
sold and, in case of any such failure, such Collateral may again be sold upon
like notice. The Collateral Agent, instead of exercising the power of sale
herein conferred upon it, may proceed by a suit or suits at law or in equity to
foreclose the security interests and sell the Collateral, or any portion
thereof, under a judgment or decree of a court or courts of competent
jurisdiction.
(b) Power of Attorney. Upon any delivery or sale of all or any part of
any Collateral made either under the power of delivery or sale given hereunder
or under judgment or decree in any judicial proceedings for foreclosure or
otherwise for the enforcement of this Collateral Agreement, the Collateral Agent
is hereby irrevocably appointed the true and lawful attorney of the Pledgor, in
the name and stead of the Pledgor, to make all necessary deeds, bills of sale
and instruments of assignment, transfer or conveyance of the property thus
delivered or sold. For that purpose the Collateral Agent may execute all such
documents and
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instruments. This power of attorney shall be deemed coupled with an interest,
and the Pledgor hereby ratifies and confirms all that his attorneys acting under
such power, or such attorneys' successors or agents, shall lawfully do by virtue
of this Collateral Agreement. If so requested by the Collateral Agent, by the
Trustees or by any purchaser of the Collateral or a portion thereof, the Pledgor
shall further ratify and confirm any such delivery or sale by executing and
delivering to the Collateral Agent, to the Trustees or to such purchaser or
purchasers at the expense of the Pledgor all proper deeds, bills of sale,
instruments of assignment, conveyance of transfer and releases as may be
designated in any such request.
(c) Application of Collateral and Proceeds. In the case of an Event of
Default, the Collateral Agent may proceed to realize upon the security interest
in the Collateral against any one or more of the types of Collateral, at any one
time, as the Collateral Agent shall determine in its sole discretion subject to
the foregoing provisions of this Section 8. The proceeds of any sale of, or
other realization upon, or other receipt from, any of the remaining Collateral
shall be applied by the Collateral Agent in the following order of priorities:
first, to the payment to the Trust of an amount equal to: (A) the
aggregate Market Value of a number of shares of Common Stock equal to (1)
the number of shares of Common Stock required to be delivered under the
Purchase Agreement on the Delivery Date minus (2) the number of shares of
Common Stock delivered by the Collateral Agent to the Trust on the Delivery
Date as described above; or (B) from and after a Reorganization Event, the
sum of (1) the Cash Delivery Obligations on the Delivery Date and (2) the
aggregate Market Value on the Delivery Date of a number of Marketable
Securities equal to (x) the number thereof permitted to be delivered on the
Delivery Date under Section 6(b) of the Purchase Agreement minus (y) the
number thereof delivered by the Collateral Agent to the Trust on the
Delivery Date as described above;
second, to the payment to the Collateral Agent of the expenses of such
sale or other realization, including reasonable compensation to the
Collateral Agent and its agents and counsel, and all expenses, liabilities
and advances incurred or made by the Collateral Agent in connection
therewith, including brokerage fees in connection with the sale by the
Collateral Agent of any Pledged Item; and
finally, if all of the obligations of the Pledgor hereunder and under
the Purchase Agreement have been
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fully discharged or sufficient funds have been set aside by the
Collateral Agent at the request of the Pledgor for the discharge thereof,
any remaining proceeds shall be released to the Pledgor.
9. The Collateral Agent.
The Collateral Agent accepts its duties and responsibilities hereunder
as agent for the Trust, on and subject to the following terms and conditions:
(a) Performance of Duties. The Collateral Agent undertakes to perform
such duties and only such duties as are expressly set forth herein and, beyond
the exercise of reasonable care in the performance of such duties, no implied
covenants or obligations shall be read into this Collateral Agreement against
the Collateral Agent. No provision hereof shall be construed to relieve the
Collateral Agent from liability for its own grossly negligent action, grossly
negligent failure to act or its own wilful misconduct, subject to the following:
(1) The Collateral Agent may consult with counsel, and the advice or
opinion of such counsel shall be full and complete authorization and
protection in respect of an action taken or suffered hereunder in good faith
and in accordance with such advice or opinion of counsel.
(2) The Collateral Agent shall not be liable with respect to any action
taken, suffered or omitted by it in good faith (i) reasonably believed by it
to be authorized or within the discretion or rights or powers conferred on
it by this Collateral Agreement or (ii) in accordance with any direction or
request of the Trustees.
(3) The Collateral Agent shall not be liable for any error of judgment
made in good faith by any of its officers, unless the Collateral Agent was
grossly negligent in ascertaining the pertinent facts.
(4) In the absence of bad faith on its part, the Collateral Agent may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any note, notice, resolution, consent,
certificate, affidavit, letter, telegram, teletype message, statement, order
or other document believed by it to be genuine and correct and to have been
signed or sent by the proper Person or Persons.
(5) No provision of this Collateral Agreement shall require the
Collateral Agent to expend or risk
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its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability
is not reasonably assured to it.
(6) The Collateral Agent may perform any duties hereunder either
directly or by or through agents or attorneys, and the Collateral Agent
shall not be responsible for any misconduct or negligence on the part of any
agent or attorney appointed with due care by it hereunder. In furtherance
thereof, any subsidiary owned or controlled by the Collateral Agent, or its
successors, as agent for the Collateral Agent, may perform any or all of the
duties of the Collateral Agent relating to the valuation of securities and
other instruments constituting Collateral hereunder.
(7) In no event shall the Collateral Agent be personally liable for any
taxes or other governmental charges imposed upon or in respect of (i) the
collateral or (ii) the income or other distributions thereon.
(8) Unless and until the Collateral Agent shall have received notice
from the Pledgor, or unless and until a Responsible Officer of the
Collateral Agent shall have actual knowledge to the contrary, the Collateral
Agent shall be entitled to deem and treat all Collateral delivered to it
hereunder as Eligible Collateral hereunder, provided that the Collateral
Agent has carried out the duties specified in Section 6 with respect to such
Collateral at the time of delivery thereof.
The Collateral Agent shall not be responsible for the correctness of the
recitals and statements herein which are made by the Pledgor or for any
statement or certificate delivered by the Pledgor pursuant hereto. Except as
specifically provided herein, the Collateral Agent shall not be responsible for
the validity, sufficiency, collectibility or marketability of any Collateral
given to or held by it hereunder or for the validity or sufficiency of the
Purchase Agreement or the Lien on the Collateral purported to be created hereby.
(b) Knowledge. The Collateral Agent shall not be deemed to have
knowledge of any Event of Default (except a Collateral Event of Default), unless
and until a Responsible Officer of the Collateral Agent shall have actual
knowledge thereof or shall have received written notice thereof.
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(c) Merger. Any corporation or association into which the Collateral
Agent may be converted or merged, or with which it may be consolidated, or to
which it may sell or transfer its agency business and assets as a whole or
substantially as a whole, or any corporation or association resulting from any
such conversion, sale, merger, consolidation or transfer to which it is a party,
shall, subject to the prior written consent of the Trust, be and become a
successor Collateral Agent hereunder and vested with all of the title to the
Collateral and all of the powers, discretions, immunities, privileges and other
matters as was its predecessor without, except as provided above, the execution
or filing of any instrument or any further act, deed or conveyance on the part
of any of the parties hereto, anything herein to the contrary notwithstanding.
(d) Resignation. The Collateral Agent and any successor Collateral
Agent may at any time resign by giving thirty days' written notice by registered
or certified mail to the Pledgor and notice to the Trust in accordance with the
provisions of Section 10(d) hereof. Such resignation shall take effect upon the
appointment of a successor Collateral Agent by the Trust.
(e) Removal. The Collateral Agent may be removed at any time by an
instrument or concurrent instruments in writing delivered to the Collateral
Agent and to the Pledgor and signed by the Trust.
(f) Appointment of Successor. (1) If the Collateral Agent hereunder
shall resign or be removed, or be dissolved or shall be in the course of
dissolution or liquidation or otherwise become incapable of action hereunder, or
if it shall be taken under the control of any public officer or officers or of a
receiver appointed by a court, a successor may be appointed by the Trust by an
instrument or concurrent instruments in writing signed by the Trust or by its
attorneys in fact fully authorized. A copy of such instrument or concurrent
instruments shall be sent by registered mail to the Pledgor.
(2) Every such temporary or permanent successor Collateral Agent
appointed pursuant to the provisions hereof shall be a trust company or bank in
good standing, having a reported capital and surplus of not less than
$100,000,000 and capable of holding the Collateral in the State of New York, if
there be such an institution willing, qualified and able to accept the duties of
the Collateral Agent hereunder upon customary terms.
(g) Acceptance by Successor. Every temporary or permanent successor
Collateral Agent appointed hereunder
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shall execute, acknowledge and deliver to its predecessor and also to the
Pledgor an instrument in writing accepting such appointment hereunder, whereupon
such successor, without any further act, deed or conveyance, shall become fully
vested with all the estates, properties, rights, powers, duties and obligations
of its predecessors. Such predecessor shall, nevertheless, on the written
request of its successor or the Pledgor, execute and deliver an instrument
transferring to such successor all the estates, properties, rights and powers of
such predecessor hereunder. Every predecessor Collateral Agent shall deliver all
Collateral held by it as the Collateral Agent hereunder to its successor. Should
any instrument in writing from the Pledgor be required by a successor Collateral
Agent for more fully and certainly vesting in such successor the estates,
properties, rights, powers, duties and obligations hereby vested or intended to
be vested in the predecessor, any and all such instruments in writing shall, at
the request of the temporary or permanent successor Collateral Agent, be
forthwith executed, acknowledged and delivered by the Pledgor.
10. Miscellaneous.
(a) Benefit of Agreement; Successors and Assigns. Whenever any of the
parties hereto is referred to, such reference shall be deemed to include the
successors and assigns of such party. All the covenants and agreements herein
contained by or on behalf of the Pledgor and the Collateral Agent shall bind,
and inure to the benefit of, their respective successors and assigns whether so
expressed or not, and shall be enforceable by and inure to the benefit of the
Trust and its successors and assigns.
(b) Separability. To the extent permitted by law, the unenforceability
or invalidity of any provision or provisions of this Collateral Agreement shall
not render any other provision or provisions herein contained unenforceable or
invalid.
(c) Amendments and Waivers. Any term, covenant, agreement or condition
of this Collateral Agreement may be amended or compliance therewith may be
waived (either generally or in a particular instance and either retrospectively
or prospectively) but only by a writing signed by the Collateral Agent, the
Pledgor and the Trust.
(d) Notices. (1) Any notice provided for herein, unless otherwise
specified, shall be in writing (including transmittals by telex or telecopier)
and shall be given to a party at the address set forth opposite such party's
name on the signature pages hereto or at such other address as may
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be designated by notice duly given in accordance with this Section 10(d) to each
other party hereto.
(2) Each such notice given pursuant to paragraph (1) shall be effective
(i) if sent by certified mail (return receipt requested), 72 hours after being
deposited in the United States mail, postage prepaid; (ii) if given by telex or
telecopier, when such telex or telecopied notice is transmitted; or (iii) if
given by any other means, when delivered at the address specified in this
Section 10(d).
(e) Governing Law. This Collateral Agreement shall in all respects be
construed in accordance with and governed by the laws of the State of New York;
provided that as to Pledged Items located in any jurisdiction other than the
State of New York, the Collateral Agent on behalf of the Trust shall have all of
the rights to which a secured party is entitled under the laws of such other
jurisdiction.
(f) Counterparts. This Collateral Agreement may be executed,
acknowledged and delivered in any number of counterparts and such counterparts
taken together shall constitute one and the same instrument.
11. Termination of Collateral Agreement.
This Collateral Agreement and the rights hereby granted by the Pledgor
in the Collateral shall cease, terminate and be void upon fulfillment of all of
the obligations of the Pledgor under the Purchase Agreement, and the Pledgor
shall have no further liability hereunder upon such termination. Any Collateral
remaining at the time of such termination shall be fully released and discharged
from the Lien hereof and delivered to the Pledgor by the Collateral Agent, all
at the expense of the Pledgor.
12. No Personal Liability of Trustees.
By executing this Collateral Agreement none of the Trustees assumes any
personal liability hereunder.
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IN WITNESS WHEREOF, the Pledgor has caused this Collateral Agreement to
be duly executed on its behalf, and the Collateral Agent has caused this
Collateral Agreement to be duly executed on its behalf, as of the date hereof.
PLEDGOR:
------------------
By
----------------------------
Name:
Title:
Address for Notices:
---------------------
Attention:
--------------------
COLLATERAL AGENT:
--------------------,
as Collateral Agent
By
----------------------------
Name:
Title:
Address for Notices:
---------------------
Attention:
--------------------
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THE TRUST:
SECOND AUTOMATIC COMMON EXCHANGE
SECURITY TRUST
---------------------------------
---------------,
as Trustee
---------------------------------
---------------,
as Trustee
---------------------------------
---------------,
as Trustee
Address for Notices:
---------------------
Attention:
--------------------
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Exhibit A
to
Collateral Agreement
CERTIFICATE FOR SUBSTITUTED COLLATERAL
The undersigned, _____________ (the "Pledgor"), hereby certifies,
pursuant to Section 6(b) of the Collateral Agreement dated as of __________,
1997 among the Pledgor, [_______________,] as Collateral Agent, and SECOND
AUTOMATIC COMMON EXCHANGE SECURITY TRUST (the "Collateral Agreement"; terms
defined in the Collateral Agreement being used herein as defined therein), that:
1. The Pledgor is delivering the following securities to the Collateral
Agent to be held by the Collateral Agent as substituted Collateral (the
"Substituted Collateral"):
2. The Pledgor requests that the Collateral Agent transfer to the
Pledgor the following Prior Collateral, pursuant to Section 6(b) of the
Collateral Agreement:
3. The Pledgor hereby represents and warrants to the Collateral Agent
and the Trust that:
(a) Consents to Transfer. No Transfer Restrictions exist with respect
to or otherwise apply to the assignment of, or transfer by the Pledgor of
possession of, any items of Substituted Collateral to the Collateral Agent under
the Collateral Agreement, or the subsequent sale or transfer of such items of
Substituted Collateral by the Collateral Agent pursuant to the terms of the
Collateral Agreement.
(b) Title to Collateral; Perfected Security Interest. The Pledgor has
good and marketable title to the Substituted Collateral, free of all Liens
(other than the Lien created by the Collateral Agreement) and Transfer
Restrictions. Upon delivery of the Collateral to the Collateral Agent, the
Collateral Agent will obtain a valid, first priority perfected security interest
in, and a first lien upon, such Substituted Collateral subject to no other Lien.
None of such Substituted Collateral is or shall be pledged by the Pledgor as
collateral for any other purpose.
This Certificate may be relied upon by the Trust as fully and to the
same extent as if this Certificate had been specifically addressed to the Trust.
28
IN WITNESS WHEREOF, the undersigned has executed this Certificate this
_____ day of ____________, 199__.
-----------------------------------
Name:
Title:
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29
Exhibit B
to
Collateral Agreement
CERTIFICATE FOR ADDITIONAL COLLATERAL
The undersigned, __________________ (the "Pledgor"), hereby certifies,
pursuant to Section 6(c) of the Collateral Agreement, dated as of ____________,
1997, among the Pledgor, [_____________________], as Collateral Agent and SECOND
AUTOMATIC COMMON EXCHANGE SECURITY TRUST (the "Collateral Agreement"; terms
defined in the Collateral Agreement being used herein as defined therein), that:
1. The Pledgor is delivering the following securities to the Collateral
Agent to be held by the Collateral Agent as additional Collateral (the
"Additional Collateral"):
2. The Pledgor hereby represents and warrants to the Collateral Agent
that:
(a) Consents to Transfer. No Transfer Restrictions exist with respect
to or otherwise apply to the assignment of, or transfer by the Pledgor of
possession of, any items of Additional Collateral to the Collateral Agent under
the Collateral Agreement, or the subsequent sale or transfer of such items of
Additional Collateral by the Collateral Agent pursuant to the terms of the
Collateral Agreement.
(b) Title to Collateral; Perfected Security Interest. The Pledgor has
good and marketable title to the Additional Collateral, free of all Liens (other
than the Lien created by the Collateral Agreement) and Transfer Restrictions.
Upon delivery of the Collateral to the Collateral Agent, the Collateral Agent
will obtain a valid, first priority perfected security interest in, and a first
lien upon, such additional Collateral subject to no other Lien. None of such
Additional Collateral is or shall be pledged by the Pledgor as collateral for
any other purpose.
This Certificate may be relied upon by the Trust as fully and to the
same extent as if this Certificate had been specifically addressed to the Trust.
30
IN WITNESS WHEREOF, the undersigned has executed this Certificate this
_____ day of ____________, 199__.
-----------------------------------
Name:
Title:
-2-
