EXHIBIT 10.9
EXECUTION COPY
________________________________________________________________________________
________________________________________________________________________________
SHAREHOLDER PLEDGE AGREEMENT
Dated April 24, 1997
From
XXXXXX XXXX,
AS PLEDGOR,
to and in favor of
XXXXXX XXXXXXX GROUP INC.,
AS COLLATERAL AGENT
________________________________________________________________________________
________________________________________________________________________________
T A B L E O F C O N T E N T S
SECTION PAGE
SECTION 1. Grant of Security................................................ 2
SECTION 2. Security for Obligations......................................... 2
SECTION 3. Delivery of the Collateral....................................... 3
SECTION 4. Representations and Warranties................................... 3
SECTION 5. Covenants........................................................ 5
SECTION 6. Consent and Waiver Regarding Other Securityholders............... 10
SECTION 7. The Collateral Agent Appointed Attorney-in-Fact.................. 10
SECTION 8. The Collateral Agent May Perform................................. 11
SECTION 9. The Collateral Agent's Duties.................................... 11
SECTION 10. Remedies........................................................ 12
SECTION 11. Acknowledgements Relating to Collateral......................... 14
SECTION 12. Amendments; Waivers; Etc........................................ 14
SECTION 13. Notices......................................................... 15
SECTION 14. Limitation on Liability; Expenses, Etc.......................... 15
SECTION 15. Continuing Security Interest; Transfers Under the Note Purchase
Agreement...................................................... 16
SECTION 16. Termination..................................................... 16
SECTION 17. Security Interest Absolute...................................... 16
SECTION 18. Reinstatement................................................... 17
SECTION 19. Severability.................................................... 17
SECTION 20. Delivery by Telecopier.......................................... 17
SECTION 21. Jurisdiction, Etc............................................... 17
SECTION 22. Governing Law................................................... 18
SECTION 23. WAIVER OF JURY TRIAL............................................ 18
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SECTION PAGE
SCHEDULES
Schedule I - Pledged Interests and Pledged Indebtedness
Schedule II - Restriction on Company Equity Interests
SHAREHOLDER PLEDGE AGREEMENT
PLEDGE AGREEMENT dated April 24, 1997 made by Xxxxxx Xxxx, an
individual residing in the State of New York (the "PLEDGOR"), to and in favor of
XXXXXX XXXXXXX GROUP INC., a Delaware corporation ("MS GROUP"), as the
collateral agent (the "COLLATERAL AGENT") for itself, the Other Purchasers (as
defined in the Note Purchase Agreements referred to below), if any, and the
other holders of the Senior Secured Increasing Rate Notes due April 24, 1998
(the "NOTES") of Econophone, Inc., a New York corporation (the "COMPANY").
PRELIMINARY STATEMENTS
(1) The Company has entered into one or more separate Note Purchase
Agreements dated as of April 24, 1997 (as amended, supplemented or otherwise
modified from time to time, the "NOTE PURCHASE AGREEMENTS") with MS Group and
the respective Other Purchasers (collectively, the "PURCHASERS") parties
thereto. Capitalized terms not otherwise defined in this Agreement shall have
the same meanings as specified in the Note Purchase Agreements and, unless
otherwise defined in this Agreement or in the Note Purchase Agreements, terms
used in Article 9 of the N.Y. Uniform Commercial Code (as defined in Section
10(a)) are used herein as therein defined.
(2) The Pledgor is the owner of the number and percentage of each
type of issued and outstanding Company Equity Interests (as hereinafter defined)
described in Part A of Schedule I attached hereto (which, as of the date of this
Agreement, represents at least 49% of the combined voting power of all issued
and outstanding Voting Interests in the Company owned by the Pledgor) and is the
owner of all of the indebtedness described in Part B of Schedule I attached
hereto and issued by the Company or one or more of the Subsidiaries of the
Company referred to therein. The Pledgor will receive substantial direct and
indirect benefits from the extensions of credit to the Company by the Purchasers
and the other holders of the Notes and, in consideration thereof, has agreed to
pledge to the Collateral Agent, for its benefit and the benefit of the Secured
Parties, (a) all of the Company Equity Interests now or hereafter owned by him
other than, so long as the NTFC Loan Agreement remains in effect, the Excluded
Company Interests (as hereinafter defined) and (b) all of the indebtedness
described on Part B of Schedule I attached hereto. For purposes of this
Agreement, the term "COMPANY EQUITY INTERESTS" means, collectively, all of the
shares of capital stock of the Company, all of the warrants, options or other
rights for the purchase or acquisition from the Company of shares of capital
stock of the Company, and all of the other ownership or profit interests in the
Company, whether voting or nonvoting, and whether or not such shares, warrants,
options, rights or other interests are authorized or otherwise existing on the
date of this Agreement. Furthermore, for purposes of this Agreement, the term
"EXCLUDED COMPANY INTERESTS" means Voting Interests in the Company owned by the
Pledgor at any time which, together with the Voting Interests in the Company
owned by all of the other Shareholders at such time, represents not more than
51% of the combined voting power of all of the issued and outstanding Voting
Interests in the Company on the date of this Agreement.
(3) It is a condition precedent to the obligations of the Purchasers
to purchase the Notes to be sold from time to time by the Company, and to pay
the purchase price therefor to the Company, under the Note Purchase Agreements
that the Pledgor shall have made the pledge and granted the assignment and
security interest contemplated by this Agreement.
NOW, THEREFORE, in consideration of the premises and in order to
induce each of the Purchasers to purchase the Notes to be sold from time to time
by the Company, and to pay the
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purchase price therefor to the Company, under the Note Purchase Agreements, the
Pledgor hereby agrees with the Collateral Agent, for the ratable benefit of the
Secured Parties, as follows:
SECTION 1. GRANT OF SECURITY. The Pledgor hereby pledges and assigns
to the Collateral Agent, for the ratable benefit of the Secured Parties, and
hereby grants to the Collateral Agent, for the ratable benefit of the Secured
Parties, a security interest in, all of its right, title and interest in and to
the following, whether now owned or hereafter acquired and whether now or
hereafter existing (collectively, the "COLLATERAL"):
(a) all of the Company Equity Interests described in Part A of
Schedule I attached hereto (the "INITIAL PLEDGED INTERESTS" and, together
with the Company Equity Interests referred to in clause (b) of this Section
1, the "PLEDGED INTERESTS") and all of the certificates, if any,
representing such Initial Pledged Interests, all security therefor and all
dividends, cash, instruments and other property and assets from time to
time received, receivable or otherwise distributed in respect of or in
exchange for any or all of the Initial Pledged Interests;
(b) all of the additional Company Equity Interests from time to time
acquired by the Pledgor in any manner other than, so long as the NTFC Loan
Agreement remains in effect, the Excluded Company Interests, whether or not
evidenced by certificates, and all of the certificates, if any,
representing such additional Company Equity Interests, all security
therefor and all dividends, cash, instruments and other property and assets
from time to time received, receivable or otherwise distributed in respect
of or in exchange for any or all of such additional Company Equity
Interests;
(c) all of the indebtedness described in Part B of Schedule I
attached hereto (collectively, the "INITIAL PLEDGED INDEBTEDNESS" and,
together with the indebtedness referred to in clause (d) of this Section 1,
the "PLEDGED INDEBTEDNESS") and all of the instruments, if any, evidencing
such Initial Pledged Indebtedness, all security therefor and all interest,
cash, instruments and other property and assets from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or
all of the Initial Pledged Indebtedness;
(d) all of the additional indebtedness from time to time owed to the
Pledgor by the Company or any of its Subsidiaries and all of the
instruments, if any, evidencing such indebtedness, all security therefor
and all interest, cash, instruments and other property and assets from time
to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such additional indebtedness; and
(e) all of the proceeds of any and all of the foregoing Collateral
(including, without limitation, proceeds that constitute property and
assets of the types described in clauses (a) through (d) of this
Section 1).
SECTION 2. SECURITY FOR OBLIGATIONS. This Agreement, and the pledge
and assignment of, and the grant of a security interest in, the Collateral by
the Pledgor hereunder, secures the payment of all Obligations of the Company and
its Subsidiaries now or hereafter existing from time to time under the Note
Purchase Agreements, the Notes and the other Note Documents (including, without
limitation, any extensions, modifications, substitutions, amendments or renewals
of any or all of the foregoing Obligations), whether direct or indirect,
absolute or contingent, and whether for principal,
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interest, premium, fees, indemnification payments, contract causes of action,
costs, expenses or otherwise (all such Obligations being the "SECURED
OBLIGATIONS").
SECTION 3. DELIVERY OF THE COLLATERAL. All certificates or
instruments representing or evidencing the Collateral shall be delivered to and
held by or on behalf of the Collateral Agent pursuant hereto and shall be in
suitable form for transfer by delivery, or shall be accompanied by duly executed
instruments of transfer or assignment in blank, all in form and substance
reasonably satisfactory to the Collateral Agent. The Collateral Agent shall
have the right, at any time and from time to time upon the occurrence and during
the continuance of a Default under Section 11.1(a), 11.1(b) or 11.1(g) of the
Note Purchase Agreements or an Event of Default, to transfer to or register in
the name of the Collateral Agent or any of its nominees any or all of the
Collateral. In addition, the Collateral Agent shall have the right at any time
and from time to time to exchange certificates or instruments representing or
evidencing the Collateral for certificates or instruments of smaller or larger
denominations.
SECTION 4. REPRESENTATIONS AND WARRANTIES. The Pledgor represents
and warrants as follows:
(a) POWER AND AUTHORITY. The Pledgor has his principal residence at
0000 00xx Xxxxxx, Xxxxxxxx, Xxx Xxxx 00000, xx xxx Xxxxxx of Kings, and the
State of New York, and has all of the requisite capacity, power and
authority, and the legal right, without the consent or approval of any
other Person, to execute, deliver and perform all of his Obligations under
or in respect of this Agreement and the other Collateral Documents to which
he is or is to be a party and to consummate all of the transactions
contemplated hereby and thereby.
(b) ENFORCEABILITY. This Agreement and each of the other Collateral
Documents to which the Pledgor is or is to be a party have been duly
executed and delivered by the Pledgor and constitute the legal, valid and
binding obligations of the Pledgor, enforceable against the Pledgor in
accordance with their respective terms.
(c) COMPLIANCE WITH LAW, OTHER INSTRUMENTS, ETC. The execution,
delivery and performance by the Pledgor of this Agreement and each of the
other Collateral Documents to which he is or is to be a party and the
consummation of the transactions contemplated hereby and thereby do not (i)
violate any Requirement of Law, (ii) conflict with or result in the breach
of, or constitute a default under, any loan or purchase agreement,
mortgage, deed of trust, lease, instrument, contract or other agreement
binding on or affecting the Pledgor or any of his property or assets or
(iii) except for the Liens created under the Collateral Documents to which
the Pledgor is or is to be a party, result in or require the creation or
imposition of any Lien upon or with respect to any of the property or
assets of the Pledgor.
(d) GOVERNMENTAL AUTHORIZATIONS, ETC. No Governmental Authorization,
and no consent, approval or authorization of, or notice to, or other action
by, any other Person, is required for (i) the due execution, delivery or
performance by the Pledgor of this Agreement or any of the other Collateral
Documents to which he is or is to be a party or the consummation of any of
the transactions contemplated hereby or thereby, (ii) the pledge of the
Collateral pursuant to this Agreement and the other Collateral Documents to
which he is or is to be a party, or the grant of the assignment and
security interest granted by the Pledgor pursuant to this Agreement and the
other Collateral Documents to which he is or is to be a party, (iii) the
perfection or
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maintenance of the pledge, assignment and security interest created under
this Agreement and the other Collateral Documents to which he is or is to
be a party (including the first priority nature thereof) or (iv) the
exercise by the Collateral Agent or any of the other Secured Parties of any
of its voting or other rights provided for under the Note Documents or its
remedies in respect of the Collateral pursuant to the Collateral Documents,
except for such Governmental Authorizations as may be required (A) in
connection with the disposition of any portion of the Pledged Interests by
laws affecting the offer and sale of securities generally or (B) from the
FCC or any PUC under the applicable Communications Laws.
(e) OWNERSHIP OF COLLATERAL. The Pledgor is, and at the time of any
delivery of Collateral to the Collateral Agent pursuant to the terms of
Section 3 will be, the sole legal and beneficial owner of the Collateral,
free and clear of all Liens, except for the pledge, assignment and security
interest created under this Agreement. No effective financing statement or
other instrument similar in effect covering all or any part of the
Collateral is on file in any recording office or other similar office,
except such as may have been filed in favor of the Collateral Agent
relating to this Agreement.
(f) PLEDGED INTERESTS. The Pledged Interests constitute the number
and percentage of each type of issued and outstanding Company Equity
Interests set forth on Part A of Schedule I attached hereto, and the
Pledgor does not own any Company Equity Interests of any kind other than
the issued and outstanding Company Equity Interests set forth on Schedule I
attached hereto and the Excluded Company Interests. All of the Pledged
Interests have been duly authorized and validly issued and are fully paid
and nonassessable. There are no existing options, warrants, calls or
commitments of any character whatsoever relating to any of the Pledged
Interests, except as are set forth in the Securityholders Agreement dated
as of November 1, 1996 (as amended, supplemented or otherwise modified
through the date hereof, the "SECURITYHOLDERS AGREEMENT") among the
Pledges, the Company and Princes Gate Investors II, L.P.
(g) PLEDGED INDEBTEDNESS. The Pledged Indebtedness constitutes all
of the outstanding indebtedness owed to the Pledgor by the Company or any
of its Subsidiaries. The Pledged Indebtedness (i) has been duly
authorized, authenticated or issued and delivered, (ii) is the legal, valid
and binding obligation of the respective issuers thereof and (iii) is
evidenced by one or more promissory notes (which notes have been delivered
to the Collateral Agent). No party to any Pledged Indebtedness is in
default thereunder.
(h) NO OTHER INSTRUMENTS; NOTATION ON BOOKS. None of the Collateral
is evidenced by a share certificate or other instrument that has not been
delivered to the Collateral Agent in its original form. The pledge of the
Pledged Interests by the Pledgor has been duly and conspicuously registered
on the books and records of the Company.
(i) RESIDENCE AND SOCIAL SECURITY NUMBER. The residence of the
Pledgor and the place where the Pledgor keeps his records concerning the
Collateral is located at the address specified therefor in Section 4(a),
and the Social Security number of the Pledgor is ###-##-####. The Pledgor
does not use, has not within the past calendar year used, and has not
established the right to use, any other name, any assumed name or any trade
name.
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(j) NO RESTRICTIONS ON PLEDGE OR SALE, ETC. There are no
restrictions on the pledge, assignment, encumbrance, ownership, transfer,
sale, conveyance or other disposition of any of the Collateral, either by
the Pledgor or, following the occurrence of any Event of Default and the
exercise of any of the rights and remedies afforded to the Collateral Agent
under Section 10, by the Collateral Agent or any purchaser of all or any of
the Collateral therefrom (whether contained in the certificate of
incorporation or bylaws of the Company or in any agreement, instrument or
other document binding upon or affecting the Pledgor, the Company or any of
the property and assets comprising part of the Collateral or imposed by any
applicable Requirement of Law), except for (A) restrictions, if any,
imposed by the FCC, (B) restrictions applicable to the disposition of any
portion of the Pledged Interests by laws affecting the offer and sale of
securities generally and (C) the restrictions described on Part A of
Schedule II attached hereto. There are no shareholder agreements, voting
trust agreements or other agreements to which the Pledgor is a party or by
which the Pledgor may otherwise be bound that affect the voting or other
rights of a holder of any of the Company Equity Interests, except for (1)
this Agreement and the other Collateral Documents, (2) the restrictions
referred to in the immediately preceding sentence of this subsection (j)
and (3) the other agreements described on Part B of Schedule II attached
hereto.
(k) FIRST PRIORITY SECURITY INTEREST. This Agreement, and the
pledge, assignment and granting of a security interest pursuant hereto,
create a valid and perfected first priority lien on and security interest
in the Collateral in favor of the Collateral Agent, for the benefit of
itself and the other Secured Parties, securing the payment of the Secured
Obligations. All of filings and other actions necessary to perfect and
protect such pledges, assignments and security interests have been duly
made or taken and are in full force and effect or will be duly made or
taken in accordance with the terms of the Note Documents; and all filing
and recording fees and taxes related to any of the foregoing have been duly
paid.
(l) SATISFACTION OF CONDITIONS PRECEDENT. There are no conditions
precedent to the effectiveness of this Agreement that have not been
satisfied or waived.
SECTION 5. COVENANTS. From the date of this Agreement and,
thereafter, so long as any of the Notes shall be outstanding, any of the
Purchasers shall have Commitments under the Note Purchase Agreements or any of
the other Secured Obligations shall remain unsatisfied, the Pledgor will at all
times perform and comply with each of the following covenants:
(a) NOTICES, ETC. RELATING TO THE COLLATERAL. The Pledgor will
furnish to the Collateral Agent and each of the other Secured Parties:
(i) promptly after the Pledgor obtains knowledge thereof,
notice, in reasonable detail, of (A) any claim made or asserted
(including, without limitation, any Lien or assertion of a Lien)
against all or any portion of the Collateral, (B) any change in the
type, amount or terms of any of the Collateral, (C) the occurrence of
a Change of Control or any change in the members of the board of
directors of, or any material change in the management of, the Company
or (D) the occurrence of any other development, event or circumstance
which, either individually or in the aggregate, could reasonably be
expected to have an adverse effect on any of the Collateral or the
pledge,
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assignment and security interest created under this Agreement or any
of the other Collateral Documents to which the Pledgor is or is to be
a party; and
(ii) with reasonable promptness, statements and schedules further
identifying and describing the Collateral or such other reports in
connection with the Collateral as the Collateral Agent or any of the
other Secured Parties, through the Collateral Agent, may from time to
time reasonably request, all in reasonable detail.
(b) COMPLIANCE WITH LAWS, ETC. The Pledgor (i) will comply in all
material respects with all Requirements of Law to which he (to the extent
the failure to comply with such restrictions could reasonably be expected
to adversely affect the Collateral or the pledge, assignment and security
interest created under this Agreement or any of the other Collateral
Documents) or the Collateral is subject and all applicable restrictions
imposed on the Collateral by any Governmental Authority and (ii) will
obtain and maintain in effect all Governmental Authorizations that are
necessary for the due execution, delivery or performance by him of this
Agreement or any of the other Collateral Documents to which he is or is to
be a party, or for the consummation of any of the transactions contemplated
hereby or thereby.
(c) PAYMENT OF TAXES AND OTHER CLAIMS. The Pledgor will pay and
discharge all taxes, assessments, levies, fees and other governmental
charges imposed upon him or any of the Collateral or any income or
franchises therefrom, to the extent such taxes, assessments, levies, fees
and other governmental charges have become due and payable and before they
have become delinquent, and all claims for which sums have become due and
payable that have resulted or could result in a Lien upon any of the
Collateral; PROVIDED, HOWEVER, that the Pledgor shall not be required to
pay or to discharge any such tax, assessment, levy, fee, other charge or
claim the amount, applicability or validity of which is being contested in
good faith and by appropriate proceedings diligently conducted and with
respect to which the Pledgor has established reserves in accordance with
generally accepted accounting principles in effect from time to time,
unless and until any Lien resulting therefrom attaches to the Collateral
and becomes enforceable by his other creditors.
(d) MAINTENANCE OF RECORDS; INSPECTION. (i) The Pledgor will
maintain, at his sole expense, complete, correct and (in the judgment of
the Collateral Agent) reasonably detailed records of all of the Collateral,
including, without limitation, records of all dividends, interest payments,
distributions and other amounts received in respect of, and other
transactions involving, the Collateral. The Pledgor will mark all of his
books and records relating to the Collateral in such a manner as to
properly evidence this Agreement and the pledge, assignment and security
interest created hereunder. For the further security of the Collateral
Agent and the other Secured Parties, the Pledgor hereby agrees that the
Collateral Agent, on behalf of itself and the other Secured Parties, shall
have a special property interest in all of the books and records of the
Pledgor relating to the Collateral, and the Pledgor will deliver and turn
over any or all of such books and records to the Collateral Agent at any
time following the occurrence and during the continuance of an Event of
Default, upon the request of the Collateral Agent therefor.
(ii) The Pledgor will permit the Collateral Agent and each of the
other Secured Parties and any of the agents or representatives thereof,
upon reasonable notice and at the sole expense of the Pledgor, at any time
and from time to time during normal business hours, to
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examine and make copies of and abstracts from all of the books, records and
correspondence of the Pledgor relating to the Company or any of its
Subsidiaries or to any of the Collateral, and to discuss the affairs,
finances and accounts of the Company and/or any such Subsidiary, as the
case may be, with, and be advised as to the same by, the Pledgor.
(e) COMPLIANCE WITH CONTRACTS, ETC. The Pledgor will perform and
comply in all material respects with all of his Obligations under or in
respect of all agreements or arrangements relating to the Company or any of
its Subsidiaries or to the Collateral to which the Pledgor is a party or by
which he is bound.
(f) CHANGE OF RESIDENCE. The Pledgor will keep his residence and the
place where he keeps his records concerning the Collateral at the location
specified therefor in Section 4(a) or, upon at least 30 days' prior written
notice to the Collateral Agent, at such other location in a jurisdiction
where all actions required by Section 5(i) shall have been taken with
respect to all of the Collateral.
(g) ADDITIONAL COMPANY EQUITY INTERESTS. The Pledgor hereby agrees
that:
(i) he will not consent to the issuance by the Company of, or
any agreement or other commitment of the Company to issue (whether by
possible exercise at a future date of any outstanding warrant, option
or other right or otherwise), any Company Equity Interests of any kind
or any other securities if, after giving effect to any such issuance
or agreement or commitment to issue, the Collateral Agent would not
have a valid and perfected first priority lien on and security
interest in the issued and outstanding Company Equity Interests
representing at least 49% of the combined power of all Voting
Interests of the Company (on a fully diluted basis); and
(ii) he shall pledge hereunder, immediately upon his acquisition
directly or indirectly thereof, any and all additional Company Equity
Interests acquired by him at any time and from time to time that, so
long as the NTFC Loan Agreement remains in effect, do not comprise
part of the Excluded Company Interests.
The Pledgor further agrees to deliver to the Collateral Agent any
amendments or supplements to this Agreement that may be necessary or that
the Collateral Agent may deem reasonably desirable and may request to
reflect the inclusion of any such additional Company Equity Interests or
other securities (including any additional indebtedness referred to in
Section 1(d)) in the Collateral.
(h) VOTING RIGHTS; DIVIDENDS; ETC. (i) The Pledgor shall be
entitled, so long as no Event of Default shall have occurred and be
continuing:
(A) to exercise any and all voting and other consensual rights
pertaining to the Collateral or any part thereof for any purpose not
otherwise prohibited under or inconsistent with the terms of this
Agreement or any of the other Note Documents and so long as any such
exercise or refrain from exercising any such right could not
reasonably be expected to materially and adversely affect the value of
the Collateral or any part thereof; and
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(B) to receive and retain any and all dividends, interest and
distributions paid or other amounts received in respect of the
Collateral; PROVIDED, HOWEVER, that any and all:
(1) dividends and interest paid or payable other than in
cash in respect of, and instruments and other property and assets
received, receivable or otherwise distributed in respect of, or
in exchange for, any Collateral; and
(2) cash paid, payable or otherwise distributed in respect
of principal of, or in redemption of, or in exchange for, any
Collateral,
shall be, and shall be forthwith delivered to the Collateral Agent to
hold as, Collateral and, if received by the Pledgor, shall be received
thereby in trust for the benefit of the Collateral Agent, shall be
segregated from the other property and funds of the Pledgor and shall
be forthwith delivered to the Collateral Agent as Collateral in the
same form as so received (with any necessary endorsement or
assignment).
In furtherance of the foregoing provisions of this Section 5(h), the
Collateral Agent shall execute and deliver (or cause to be executed and
delivered) to the Pledgor all such proxies and other instruments as the
Pledgor may reasonably request for the purpose of enabling the Pledgor to
exercise the voting and other consensual rights that he is entitled to
exercise pursuant to subclause (i)(A) of this Section 5(h) and to receive
the dividends, interest payments, distributions or other amounts that he is
authorized to receive and retain pursuant to subclause (i)(B) of this
Section 5(h).
(ii) Upon the occurrence and during the continuance of an Event of
Default:
(A) all rights of the Pledgor to exercise or refrain from
exercising the voting and other consensual rights that he would
otherwise be entitled to exercise pursuant to Section 5(h)(i)(A)
shall, upon notice to the Pledgor by the Collateral Agent, cease, and
all such rights with respect to any such matters shall thereupon
become vested in the Collateral Agent, which shall thereupon have the
sole right to exercise or refrain from exercising such voting and
other consensual rights; and
(B) all rights of the Pledgor to receive the dividends, interest
payments, distributions and other amounts that he would otherwise be
authorized to receive and retain pursuant to Section 5(h)(i)(B) shall
automatically cease, and all such rights shall thereupon become vested
in the Collateral Agent, which shall thereupon have the sole right to
receive and retain as Collateral such dividends, interest payments,
distributions and other amounts.
All dividends, interest payments, distributions and other amounts that are
received by the Pledgor contrary to the provisions of subclause (ii)(B) of
this Section 5(h) shall be received in trust for the benefit of the
Collateral Agent, shall be segregated from other property and funds of the
Pledgor and shall be forthwith paid over to the Collateral Agent as
Collateral in the same form as so received (with any necessary endorsement
or assignment). The agreement of the Pledgor in this clause (ii) shall
constitute an irrevocable proxy, coupled with an interest, exercisable by
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the Collateral Agent in accordance with the terms hereof. The Pledgor,
promptly upon the reasonable request of the Collateral Agent, shall execute
such documents and do such acts as may be necessary or in the reasonable
judgment of the Collateral Agent may be desirable to give effect to clause
(ii) of this Section 5(h).
(i) FURTHER ASSURANCES. (i) The Pledgor hereby agrees that from
time to time, at his sole expense, he will promptly execute and deliver all
further instruments and documents, and take all further actions, that may
be necessary or that the Collateral Agent may deem reasonably desirable and
may request, in order to perfect and protect the pledge, assignment or
security interest granted or purported to be granted by the Pledgor
hereunder (including, without limitation, the first priority nature
thereof) or to enable the Collateral Agent to exercise and enforce its
rights and remedies hereunder or under any of the other Collateral
Documents with respect to any of the Collateral. Without limiting the
generality of the foregoing, the Pledgor will:
(A) if any Collateral shall be evidenced by a certificate or
other instrument, immediately deliver and pledge to the Collateral
Agent hereunder such certificate or other instrument, duly endorsed
and accompanied by duly executed instruments of transfer or
assignment, all in form and substance reasonably satisfactory to the
Collateral Agent; and
(B) execute and file such financing statements, continuation
statements or other similar documents, or amendments thereto, and such
other instruments or notices, or take such other actions, as may be
necessary or as the Collateral Agent may deem reasonably desirable and
may request, in order to perfect and preserve the pledge, assignment
and security interest granted or purported to be granted by the
Pledgor under this Agreement.
(ii) The Pledgor hereby authorizes the Collateral Agent to file one or
more financing statements, continuation statements or other similar
documents, and amendments thereto, relating to all or any part of the
Collateral without the signature of the Pledgor, where permitted by
applicable law. A photocopy or other reproduction of this Agreement or any
financing statement or other similar document covering the Collateral or
any part thereof shall be sufficient as a financing statement or other
similar document, where permitted by applicable law.
(j) LIENS, ETC. The Pledgor will not create, incur, assume or suffer
to exist any Lien on or with respect to any of the Collateral, whether now
owned or hereafter acquired, or file or suffer to exist under the Uniform
Commercial Code or any similar law or statute of any jurisdiction, a
financing statement (or the equivalent thereof) that extends to or covers
any of the Collateral, or sign or suffer to exist any pledge or security
agreement authorizing any secured party thereunder to file any such
financing statement (or the equivalent thereof), except (i) for the pledge,
assignment and security interest created therein under this Agreement and
the other Collateral Documents to which he is or is to be a party (and the
filing and existence of financing statements and other similar documents
pursuant hereto and thereto) and (ii) on and after the Additional
Availability Date, for the pledge, assignment and security interest created
in the Pledged Interests under the NTFC Loan Documents (as amended,
supplemented or otherwise modified at such date in a manner otherwise
permitted under Section 8.10 of the Note Purchase Agreements), which
pledge, assignment and security interests shall be subject in all respects
to
10
the prior lien and security interest in the Collateral created under this
Agreement and the other Collateral Documents.
(k) TRANSFERS OF COLLATERAL. The Pledgor will not convey, sell,
transfer, assign (by operation of law or otherwise) or otherwise dispose
of, or grant any option or other right to purchase or otherwise acquire,
any of the Collateral or any of the other Company Equity Interests owned or
otherwise held thereby, whether now owned or hereafter acquired.
SECTION 6. CONSENT AND WAIVER REGARDING OTHER SECURITYHOLDERS. (a)
The Pledgor hereby unconditionally and irrevocably consents to (i) the
execution, delivery and performance by all of the other Shareholders of the
other Shareholder Pledge Agreements and the Collateral Documents to which they
are or are to be a party, (ii) the pledge, assignment, encumbrance, transfer
and/or sale of any of the Company Equity Interests, or other securities or
indebtedness of the Company or any of its Subsidiaries, owned or otherwise held
by the other Shareholders to the Collateral Agent or its nominee, subagent,
assignee or successor, or any purchaser therefrom, pursuant to the terms of the
Note Documents and (iii) the substitution in accordance with the terms of this
Agreement and the other Collateral Documents of the Collateral Agent or its
nominee, subagent, assignee or successor, or any purchaser therefrom, as a
shareholder of the Company for purposes of any and all agreements,
understandings or arrangements among the Shareholders (in such capacity).
(b) The Pledgor hereby unconditionally and irrevocably waives all
restrictions on the transfer or sale of any Company Equity Interests, or other
securities or indebtedness of the Company or any of its Subsidiaries, by any of
the Shareholders (including, without limitation, any options, rights of first
refusal, rights of first offer, tag-along rights or other similar rights),
whether contained in the certificate of incorporation or bylaws of the Company
or in any agreement, instrument or other document among any of the Shareholders
or imposed by any applicable Requirement of Law.
(c) The Pledgor hereby unconditionally and irrevocably waives his
right under Section 4.3 of the Securityholders Agreement to request the Transfer
(as defined in the Securityholders Agreement) of shares of Series A Preferred
Stock (or any securities into which such shares are convertible or exchangeable
or for which such shares are exercisable) by the holders thereof to the extent
such right relates to the pledge, assignment and security interest granted by
the Pledgor under this Agreement or any of the other Collateral Documents to
which he is or is to be a party or, on and after the Additional Availability
Date, under the applicable pledge agreements entered into by the Pledgor with
NTFC, on behalf of itself and the other NTFC Lenders, pursuant to, and in
accordance with the terms of, Section 8.10 of the Note Purchase Agreements.
SECTION 7. THE COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT. The
Pledgor hereby irrevocably appoints the Collateral Agent and any officer or
agent thereof as its true and lawful attorney-in-fact, with full power of
substitution and full and irrevocable power and authority in the place and stead
of the Pledgor and in the name of the Pledgor, its own name or otherwise, from
time to time in the Collateral Agent's discretion following the occurrence and
during the continuance of a Default under Section 11.1(g) of the Note Purchase
Agreements or an Event of Default, to take any and all actions and to execute
and deliver any and all instruments and other documents that may be necessary or
that the Collateral Agent may deem reasonably appropriate to accomplish the
purposes of this Agreement and the other Note Documents, including, without
limitation:
11
(a) to ask for, demand, collect, sue for, recover, compromise,
receive and give acquittance and receipts for any and all moneys due and to
become due under or in respect of any of the Collateral;
(b) to receive, endorse, assign and collect any and all drafts,
acceptances, chattel paper, instruments and other documents in connection
with this Agreement (including, without limitation, all instruments
representing or evidencing any interest payment or other distribution in
respect of the Collateral or any part thereof) and to give full discharge
for the same;
(c) to sell, transfer, assign or otherwise deal with the Collateral
or any part thereof in the same manner and to the same extent as if the
Collateral Agent were the absolute owner thereof;
(d) (i) to direct any Person liable to the Pledgor for any payment
with respect to the Collateral to make payment of any and all moneys due
and to become due thereunder directly to the Collateral Agent or as the
Collateral Agent shall direct, (ii) to receive payment of and receipt for
any and all moneys, claims and other amounts due and to become due at any
time in respect of or arising out of any Collateral, (iii) to defend any
suit, action or proceeding brought against the Pledgor with respect to any
of the Collateral and (iv) to settle, compromise or adjust any suit, action
or proceeding described in clause (iii) of this subsection (d) and, in
connection therewith, to give such discharges or releases as the Collateral
Agent may deem appropriate;
(e) to file any application, petition or other request with the FCC,
any PUC or any other Governmental Authority for the purpose of obtaining
any consent, approval or authorization therefrom or satisfying any
registration, filing, notice or other requirement thereof necessary in
order to fully and properly effect the sale, transfer or other disposition
of any or all of the Collateral, to permit a change of control of the
Company or to permit the complete and/or continued operation of the
telecommunications system of the Company and its Subsidiaries in accordance
with its intended design and at its full capacity, or any of its other
businesses or activities related thereto; and
(f) to file any claims, to institute any proceedings and to take any
other action, at the sole expense and for the account of the Pledgor, that
may be necessary or that the Collateral Agent may deem reasonably desirable
for the collection of any or all of the Collateral (or any or all moneys
due with respect thereto) or otherwise to enforce the rights of the
Collateral Agent with respect to any of the Collateral.
SECTION 8. THE COLLATERAL AGENT MAY PERFORM. If the Pledgor fails to
perform any agreement contained herein, the Collateral Agent may (but shall not
be obligated to) itself perform, or cause performance of, such agreement, and
the expenses of the Collateral Agent incurred in connection therewith shall be
payable by the Pledgor under Section 14(b).
SECTION 9. THE COLLATERAL AGENT'S DUTIES. The powers conferred on
the Collateral Agent hereunder are solely to protect its interest in the
Collateral and shall not impose any duty upon it to exercise any such powers.
Except for the safe custody of any Collateral in its possession and the
accounting for moneys actually received by it hereunder, the Collateral Agent
shall have no duty as to any Collateral, as to ascertaining or taking action
with respect to calls, conversions, exchanges,
12
maturities, tenders or other matters relative to any Collateral, whether or not
the Collateral Agent or any of the other Secured Parties has or is deemed to
have knowledge of such matters, or as to the taking of any steps necessary to
preserve rights against any parties or any other rights pertaining to any
Collateral, whether or not the Collateral Agent has or is deemed to have such
rights. The Collateral Agent shall be deemed to have exercised reasonable care
in the custody and preservation of any Collateral in its possession if such
Collateral is accorded treatment substantially equal to that which MS Group
accords its own property of like tenor.
SECTION 10. REMEDIES. If any Event of Default shall have occurred
and be continuing:
(a) The Collateral Agent may exercise in respect of the Collateral,
in addition to other rights and remedies provided for herein or otherwise
available to it, all the rights and remedies of a secured party upon
default under the Uniform Commercial Code in effect in the State of
New York at such time (the "N.Y. UNIFORM COMMERCIAL CODE"), whether or not
the N.Y. Uniform Commercial Code applies to the affected Collateral, and
also may:
(i) require the Pledgor to, and the Pledgor hereby agrees
that he will at his own expense and upon request of the Collateral
Agent forthwith, assemble all or part of the Collateral as directed by
the Collateral Agent and make it available to the Collateral Agent at
a place to be designated by the Collateral Agent that is reasonably
convenient to both parties;
(ii) without notice except as specified below, sell the
Collateral or any part thereof in one or more parcels at public or
private sale, at any exchange or broker's board or at any of the
Collateral Agent's offices or elsewhere, for cash, on credit or for
future delivery, and upon such other terms as the Collateral Agent may
deem commercially reasonable; and
(iii) notify the Pledgor that all of his rights to exercise or
refrain from exercising the voting and other consensual rights that he
would otherwise be entitled to exercise with respect to the Collateral
pursuant to Section 5(h)(i) or 5(h)(ii) shall cease and all such
rights shall thereupon become vested in the Collateral Agent, who
shall thereupon have the sole right to exercise or refrain from
exercising such voting and other consensual rights.
The Pledgor hereby agrees that, to the extent notice of sale shall be
required by applicable law, at least ten days' notice to the Pledgor of the
time and place of any public sale or the time after which any private sale
is to be made shall constitute reasonable notification. The Collateral
Agent shall not be obligated to make any sale of Collateral regardless of
notice of sale having been given. The Collateral Agent may adjourn any
public or private sale from time to time by announcement at the time and
place fixed therefor, and such sale, without further notice, may be made at
the time and place to which it was so adjourned.
(b) If the Collateral Agent proceeds to exercise its right to sell
any or all of the Collateral, the Pledgor shall, upon the written request
of the Collateral Agent therefor, cause the Company to furnish to the
Collateral Agent all such information as the Collateral Agent may
13
request in order to determine the number of shares and other instruments
included in such Collateral that may be sold by the Collateral Agent in
transactions exempt under the Securities Act and the rules and regulations
of the Securities and Exchange Commission thereunder, or any similar law,
rule or regulation in effect from time to time in any other relevant
jurisdiction.
(c) Each purchaser of all or any part of the Collateral at any such
sale that has been made in accordance with all applicable Requirements of
Law shall hold the property sold absolutely free from any claim,
encumbrance or other right on the part of the Pledgor, and the Pledgor
hereby waives, to the fullest extent permitted by applicable law, all
rights of redemption, stay and/or appraisal that he now has or may at any
time in the future have under any rule of law or statute now existing or
hereafter enacted with respect to any such sale.
(d) All proofs of claim, rights of action and rights to assert claims
under this Agreement or any of the Collateral Documents to which the
Pledgor is or is to be a party may be enforced by the Collateral Agent
without the possession of any of the Notes at any proceeding instituted by
the Collateral Agent, and any such proceeding may be brought in its own
name as agent, and any recovery or judgment shall be for the benefit of the
Secured Parties. In any proceeding brought by the Collateral Agent (and in
any proceeding involving the interpretation of any provisions of any of the
Collateral Documents to which the Collateral Agent is a party), the
Collateral Agent shall be held to represent all of the Secured Parties, and
it shall not be necessary to make any of the other Secured Parties party to
such proceeding.
(e) All cash held by the Collateral Agent as Collateral and all cash
proceeds received by the Collateral Agent in respect of any sale of,
collection from, or other realization upon, all or any part of the
Collateral may, in the discretion of the Collateral Agent, be held by the
Collateral Agent as collateral for, and/or then or at any time thereafter
applied (after payment of any amounts payable to the Collateral Agent
pursuant to Section 14) in whole or in part by the Collateral Agent, for
the ratable benefit of the Secured Parties, against, all or any part of the
Secured Obligations in such order as the Collateral Agent shall elect. Any
surplus of cash or cash proceeds held by the Collateral Agent in accordance
with this Section 10(e) and remaining after payment in full in cash of all
the Secured Obligations and all of the other Obligations owing under or in
respect of the Note Documents shall be paid over to the Pledgor or to
whomsoever may be lawfully entitled to receive such surplus.
(f) The Collateral Agent may exercise any and all rights and remedies
of the Pledgor in respect of the Collateral.
(g) All payments received by the Pledgor under, in connection with or
in respect of any Collateral shall be received in trust for the benefit of
the Collateral Agent, shall be segregated from other property and funds of
the Pledgor and shall be forthwith paid over to the Collateral Agent in the
same form as so received (with any necessary endorsement or assignment).
(h) In connection with the exercise and enforcement by the Collateral
Agent of any of the rights and remedies afforded to it following the
occurrence and during the continuance of an Event of Default, the Pledgor
agrees to, and shall use his reasonable best efforts to cause the Company
to, join and cooperate fully, in each case at the Collateral Agent's
election, with the Collateral Agent, any receiver or trustee, and/or the
successful bidder or bidders at any
14
foreclosure, sale or other disposition of the Collateral and in the filing
of any and all applications (and furnishing of all additional information
that may be required in connection with such application) with the FCC, any
PUC and any other applicable Governmental Authorities, requesting their
prior consent, approval or authorization of (i) the operation or
abandonment of all or any portion of the telecommunications system of the
Company and its Subsidiaries, or any of its other businesses or activities
related thereto, (ii) the transfer or assignment of any or all Governmental
Authorizations issued to the Company or any of its Subsidiaries by the FCC,
any PUC and any other applicable Governmental Authorities with respect to
the telecommunications system of the Company and its Subsidiaries, or any
of its other businesses or activities related thereto, to the Collateral
Agent, any such receiver or trustee, and/or any such successful bidder or
bidders or (iii) the transfer, sale or other disposition of any of the
Collateral. In connection with the foregoing, the Pledgor agrees to use
his reasonable best efforts to cause the Company to take any and all such
further actions, and execute and deliver any and all such further
agreements, instruments and other documents as may be necessary or as the
Collateral Agent may deem reasonably desirable and may request. If
required, the Pledgor shall file any application, notice, petition or other
request with the FCC, any PUC and any other applicable Governmental
Authorities for the purpose of obtaining the consent, approval or
authorization from, or satisfying any registration, filing, notice or other
requirement of, any Governmental Authority in order to fully and properly
effect a transfer, sale or other disposition of all or any of the
Collateral, to permit a change of control of the Company or to permit the
Collateral Agent, any such receiver or trustee, and/or any such successful
bidder or bidders to complete and operate the telecommunications system of
the Company and its Subsidiaries in accordance with its intended design and
at its full capacity, or any of its other businesses or activities related
thereto.
SECTION 11. ACKNOWLEDGEMENTS RELATING TO COLLATERAL. The Pledgor
recognizes that, by reason of certain prohibitions contained in the Securities
Act and applicable state securities laws (or other similar laws, rules or
regulations of other relevant jurisdictions), the Collateral Agent may be
compelled with respect to any sale of all or any part of the Collateral to limit
the purchases thereof to those Persons who will agree, among other things, to
acquire the Collateral for their own account, for investment and not with a view
to the distribution or resale thereof. The Pledgor hereby acknowledges that any
such private sale may be at a price and on terms less favorable to the
Collateral Agent and the other Secured Parties than those obtainable through a
public sale without such restrictions (including, without limitation, a public
offering made pursuant to a registration statement under the Securities Act)
and, notwithstanding such circumstances, the Pledgor hereby agrees that any
private sale shall be deemed to have been made in a commercially reasonable
manner and that the Collateral Agent shall have no obligation to engage in
public sales and no obligation to delay the sale of any Collateral for the
period of time necessary to permit the issuer thereof to register it for a form
of public sale requiring registration under the Securities Act or any applicable
state securities laws (or other similar laws, rules or regulations of other
relevant jurisdictions), even if the Pledgor would agree to do so. The Pledgor
hereby waives any claims against the Collateral Agent arising by reason of the
fact that the price at which any Collateral may have been sold at such a private
sale was less than the price that might have been obtained at a public sale,
even if the Collateral Agent accepts the first offer received and does not offer
such Collateral to more than one offeree.
SECTION 12. AMENDMENTS; WAIVERS; ETC. (a) No amendment or waiver of
any provision of this Agreement, and no consent to any departure by the Pledgor
herefrom, shall in any event
15
be effective unless the same shall be in writing and signed by the Collateral
Agent, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
(b) No failure on the part of the Collateral Agent to exercise, and
no delay in exercising any right, power or privilege hereunder, shall operate as
a waiver thereof or consent thereto; nor shall any single or partial exercise of
any such right, power or privilege preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The remedies
herein provided are cumulative and not exclusive of any remedy provided by
applicable law.
SECTION 13. NOTICES. (a) All notices and other communications
provided for hereunder shall be in writing and delivered by telecopier or (if
expressly permitted under the applicable provisions hereof) by telephone, in
either case if the sender on the same day sends a confirming copy of such notice
by a recognized overnight delivery service (charges prepaid), by registered or
certified mail with return receipt requested (postage prepaid) or by a
recognized overnight delivery service (with charges prepaid). Any such notice
must be sent:
(i) if to the Collateral Agent, to the Collateral Agent at its
address at 0000 Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (Telecopier
Number: (000) 000-0000), Attention: Xx. Xxxxx X. Xxxxxx;
(ii) if to any of the other Secured Parties, to such Secured Party
at its address referred to in Section 17(a) of the Note Purchase
Agreements; or
(iii) if to the Pledgor, to the Pledgor at his address set forth in
Section 4(a), or such other address as the Pledgor shall have specified to
the Collateral Agent and each of the other Secured Parties in writing.
All notices and other communications provided for under this Section 13 will be
deemed given and effective only when actually received.
(b) If any notice required under this Agreement is permitted to be
made, and is made, by telephone, actions taken or omitted to be taken in
reliance thereon by the Collateral Agent or any of the other Secured Parties
shall be binding upon the Pledgor notwithstanding any inconsistency between the
notice provided by telephone and any subsequent writing in confirmation thereof
provided to the Collateral Agent or such other Secured Party; PROVIDED that any
such action taken or omitted to be taken by the Collateral Agent or such other
Secured Party shall have been in good faith and in accordance with the terms of
this Agreement.
SECTION 14. LIMITATION ON LIABILITY; EXPENSES, ETC. (a) The
Pledgor agrees not to assert any claim against the Collateral Agent, any of the
other Secured Parties or any other Person who is or was at any time a Purchaser
or any other Person in whose name or for whose benefit such Person holds or at
any time held any Notes, or any of their affiliates, or any of their respective
officers, directors, employees, attorneys, agents and other advisors, on any
theory of liability, for special, indirect, consequential or punitive damages
arising out of or otherwise relating to this Agreement, including, without
limitation, enforcement of this Agreement, or any of the Collateral.
16
(b) The Pledgor shall, upon demand, pay to the Collateral Agent
the amount of any and all reasonable expenses (including, without limitation,
the reasonable fees and disbursements of its counsel and of any experts and
agents) that the Collateral Agent may incur in connection with the failure by
the Pledgor to perform or observe any of the provisions of this Agreement or any
of the other Collateral Documents to which he is or is to be a party.
(c) Without prejudice to the survival of any other agreement of
the Pledgor under this Agreement, the agreement and obligations of the Pledgor
contained in this Section 14 shall survive the payment in full of all of the
Secured Obligations and all of the other Obligations owing under or in respect
of the Note Documents.
SECTION 15. CONTINUING SECURITY INTEREST; TRANSFERS UNDER THE NOTE
PURCHASE AGREEMENT. This Agreement shall create a continuing security interest
in the Collateral and (a) shall remain in full force and effect until the later
of (i) the payment in full in cash of all of the Secured Obligations and all of
the other Obligations owing under or in respect of the Note Documents and (ii)
the termination of the aggregate Commitments of the Purchasers under the Note
Purchase Agreements, (b) be binding upon the Pledgor, his successors and assigns
and (c) inure, together with the rights and remedies of the Collateral Agent
hereunder, to the benefit of, and be enforceable by, the Collateral Agent and
each of the other Secured Parties and their respective successors, transferees
and assigns.
SECTION 16. TERMINATION. Upon the later of (a) the payment in full
in cash of all of the Secured Obligations and all of the other Obligations owing
under or in respect of the Note Documents and (b) the termination of the
aggregate Commitments of the Purchasers under the Note Purchase Agreements the
pledge, assignment and security interest of the Pledgor under this Agreement
shall terminate and all rights in and to the Collateral shall revert to the
Pledgor. Upon any such termination, the Collateral Agent will, at the Pledgor's
sole expense, return to the Pledgor such of the Collateral in its possession as
shall not have been sold or otherwise applied pursuant to the terms of the Note
Documents, and shall execute and deliver to the Pledgor such documents as the
Pledgor shall reasonably request to evidence such termination and reversion.
SECTION 17. SECURITY INTEREST ABSOLUTE. The Obligations of the
Pledgor under this Agreement and the other Collateral Documents to which he is
or is to be a party are independent of the Obligations of any other Obligor
under or in respect of the Note Documents, and a separate action or actions may
be brought or prosecuted against the Pledgor, irrespective of whether any action
is brought against any other Obligor or whether any other Obligor is joined in
any such action or actions. All rights of the Collateral Agent and the pledges,
assignments and security interests created hereunder and under the other
Collateral Documents to which the Pledgor is or is to be a party, and all
Obligations of the Pledgor hereunder, shall be direct, absolute and
unconditional, irrespective of, and the Pledgor hereby irrevocably waives any
defenses he may now or hereafter have in any way relating to, any or all of the
following:
(a) any lack of validity or enforceability of, or any
misrepresentation, irregularity or other defect in, any of the Note
Documents or any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Secured Obligations or any of the
other Obligations of any other Obligor under
17
the Note Documents, or any other amendment or waiver of or any consent to
departure from any of the Note Documents;
(c) any taking, exchange, release or nonperfection of any collateral,
or any taking, release, amendment or waiver of or consent to departure from
any guaranty, for all or any of the Secured Obligations;
(d) any manner of application of collateral, or proceeds thereof, to
all or any of the Secured Obligations, or any manner of sale, transfer or
other disposition of any collateral for all or any of the Secured
Obligations or any of the other Obligations of any other Obligor under or
in respect of the Note Documents;
(e) any insolvency, bankruptcy, reorganization, receivership or
similar proceeding affecting any other Obligor or its property and assets,
or the release or discharge of any other Obligor from any of their
respective Obligations under or in respect of the Note Documents;
(f) any change, restructuring or termination of the corporate
structure or existence of the Company or any of its Subsidiaries;
(g) any failure of the Collateral Agent or any of the other Secured
Parties to disclose to any Obligor any information relating to the
financial condition, operations, properties or prospects of the Company or
any of its Subsidiaries now or hereafter known to the Collateral Agent or
such other Secured Party; or
(h) any other circumstance (including, without limitation, any
statute of limitations or the existence of or reliance upon any
representation by the Collateral Agent or any of the other Secured Parties)
that might otherwise constitute a defense available to, or a discharge of,
such Pledgor or a third party grantor of a security interest.
SECTION 18. REINSTATEMENT. This Agreement shall continue to be
effective or be reinstated, as the case may be, if at any time any payment of
any of the Secured Obligations is rescinded or must otherwise be returned by the
Collateral Agent or any of the other Secured Parties or by any other Person upon
the insolvency, bankruptcy or reorganization of the Pledgor or otherwise, all as
though such payment had not been made.
SECTION 19. SEVERABILITY. The provisions of this Agreement are
severable, and if any term or provision shall be held illegal, invalid or
unenforceable in whole or in part in any jurisdiction, then such illegality,
invalidity or unenforceability shall affect only such term or provision, or part
thereof, in such jurisdiction, and shall not in any manner affect such term or
provision in any other jurisdiction, or any other term or provision of this
Agreement in any jurisdiction.
SECTION 20. DELIVERY BY TELECOPIER. Delivery of an executed
signature page to this Agreement by telecopier shall be effective as delivery of
a manually executed signature page to this Agreement.
SECTION 21. JURISDICTION, ETC. (a) The Pledgor hereby irrevocably
and unconditionally submits, for himself and his property and assets, to the
nonexclusive jurisdiction of any
18
New York state court or any federal court of the United States of America
sitting in New York City, New York, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Agreement or any of
the other Collateral Documents to which he is a party, or for recognition or
enforcement of any judgment in respect thereof, and the Pledgor hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in any such New York state
court or, to the fullest extent permitted by applicable law, in any such federal
court. The Pledgor hereby irrevocably consents to the service of copies of any
summons and complaint and any other process which may be served in any such
action or proceeding by the mailing thereof by certified mail, return receipt
requested, or by delivering a copy of such process to the Pledgor, at his
address referred to in Section 13, or by any other method permitted by
applicable law. The Pledgor hereby agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
applicable law. Nothing in this Agreement shall affect any right the Collateral
Agent or any of the other Secured Parties may otherwise have to bring any action
or proceeding relating to this Agreement or any of the other Collateral
Documents to which he is a party in the courts of any jurisdiction.
(b) The Pledgor hereby irrevocably and unconditionally waives, to the
fullest extent he may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue in any action or proceeding arising
out of or relating to this Agreement or any of the other Collateral Documents to
which he is or is to be a party in any New York state or federal court. The
Pledgor hereby irrevocably waives, to the fullest extent permitted by applicable
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
SECTION 22. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York, except to the
extent that the perfection of the pledge, assignment and security interest
created hereunder, or remedies hereunder, in respect of any particular
Collateral are governed by the laws of a jurisdiction other than the State of
New York.
SECTION 23. WAIVER OF JURY TRIAL. THE PLEDGOR HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
(WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR ANY OF THE OTHER NOTE DOCUMENTS, THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY OR THE ACTIONS OF THE COLLATERAL AGENT OR ANY OF THE OTHER
SECURED PARTIES IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT
THEREOF.
IN WITNESS WHEREOF, the Pledgor has duly executed and delivered this
Agreement as of the date first above written.
By ____________________
Xxxxxx Xxxx
