Exhibit 7(D)
NationsBank of Texas, N.A.
Conformed Pledge Agreement*
July 23, 1997
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AGENT/SECURED PARTY: PLEDGOR(S)/DEBTOR(S):
NationsBank of Texas, N.A., Agent Xxxx X. Xxxxxx
000 Xxxx Xxxxxx c/o Tele-Communications, Inc.
00xx Xxxxx Xxxxxxx Xxxxx XX
Xxxxxx, XX 00000 0000 XXX Xxxxxxx
Xxxxxx Xxxxxx Xxxxxxxxx, XX 00000
__________ County
(Street address including county) (Name and street address including county)
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Pledgor/Debtor is: [X] Individual [_] Corporation [_] Partnership [_] Other
Address is Pledgor's/Debtor's: [_] Residence [X] Place of Business [_] Chief
Executive Office if more than one place of business
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Capitalized terms not otherwise defined in this Pledge Agreement (this
"Agreement") have the same meaning as assigned to such terms in the Loan
Agreement (hereinafter defined).
1. Security Interest. For good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Pledgor/Debtor (hereinafter referred
to as "Pledgor") pledges, assigns and grants to Agent/Secured Party (hereinafter
referred to as "Secured Party"), for the benefit of the Lenders, a security
interest and lien in the Collateral (hereinafter defined) to secure the payment
and the performance of the Obligation (hereinafter defined).
2. Collateral. The security interest is granted in the following collateral
(the "Collateral"):
A. Description of Collateral. The investment property and/or securities
evidenced or represented by the certificated securities described on Schedule I
attached hereto and incorporated herein for all purposes, together with all
investment property and/ or securities hereafter delivered to Secured Party in
substitution therefor or in addition thereto (such investment property and/or
securities described on Schedule I or hereafter delivered to Secured Party,
collectively referred to herein as the "Pledged Shares"), together with all
cash, securities, dividends, increases, distributions and profits received from
or on the Pledged Shares, including distributions or payments in partial or
complete liquidation or redemption, or as a result of reclassifications,
readjustments, reorganizations or changes in the capital structure of the
issuers of the Pledged Shares (hereinafter referred to herein -- whether one or
more -- as the "Issuers") and any other property at any time and from time to
time received, receivable or otherwise distributed or delivered to Secured
Party, and all rights and privileges pertaining thereto.
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* Conformed to show signatures.
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It is contemplated by the parties that Pledgor may provide additional Collateral
from time to time hereunder as additional security for the Obligation, and may
from time to time, with the prior written consent of Secured Party, sell or
otherwise dispose of any Collateral provided that Pledgor provides Secured Party
with substitute Collateral satisfactory to Secured Party in its sole discretion,
and Pledgor complies at all times with the provisions of Section 6 hereof. At
the time of each addition or substitution of Collateral, the investment property
and/or securities added or substituted shall be identified on a Pledge
Certificate, substantially in the form of Schedule III attached hereto (the
"Pledge Certificate"), and delivered to Secured Party. Pledgor understands and
agrees that Secured Party is under no obligation to attribute Collateral Value
(as hereinafter defined) to any such additional or substituted Collateral unless
(i) such additional and/or substituted Collateral is satisfactory to Secured
Party in its sole discretion, and (ii) the security interest granted to Secured
Party therein is perfected to the satisfaction of Secured Party. All such
additional and/or substituted Collateral shall be considered "Pledged Shares"
and "Collateral" for purposes of this Agreement, and shall secure the Obligation
in the same manner as the Collateral for which it is added to and/or
substituted. In addition, the issuers of additional investment property and/or
securities, constituting Collateral for the purposes of this Agreement, shall be
considered "Issuers," for all purposes of this Agreement.
B. Proceeds. All additions, substitutes and replacements for and
proceeds of the above Collateral (including all income and benefits resulting
from any of the above, such as dividends payable or distributable in cash,
property or stock; interest, premium and principal payments; redemption proceeds
and subscription rights; and shares or other proceeds of conversions or splits
of any securities in the Collateral). All subscriptions, warrants, options and
any other rights issued now or hereafter by any of the Issuers or any other
person whatsoever upon or in connection with the above Collateral and all
accounts and general intangibles arising from or related to the Collateral. Any
investment property and/or securities received by Pledgor, which shall comprise
such additions, substitutes and replacements for, or proceeds of, the
Collateral, shall be held in trust for Secured Party and shall be delivered
immediately to Secured Party. Any cash proceeds shall be held in trust for
Secured Party and upon request shall be delivered immediately to Secured Party;
provided however, prior to the occurrence of an Event of Default (as hereinafter
defined) Pledgor may retain any cash dividends paid on the Collateral.
3. Obligation.
A. Description of Obligation. The following obligations ("Obligation")
are secured by this Agreement:
i. All Debt: All debts, obligations, liabilities and agreements
now or hereafter existing, arising directly or indirectly between Pledgor,
Secured Party, Co-Agent and any of the Lenders under that certain Revolving
Credit Agreement (as renewed, extended, amended, or restated, the "Loan
Agreement") dated as of the date hereof, between Pledgor, Secured Party as
"Agent" for the "Lenders," Toronto Dominion Securities (USA), Inc. as "Co-
Agent," and certain other Lenders, whether absolute or contingent, joint or
several, secured or unsecured, due or not due, liquidated or unliquidated,
arising by operation of law or otherwise, and all renewals, extensions and
rearrangements of any of the above.
ii. NationsBank Promissory Note: All debt arising under that
certain Revolving Credit Note dated July 23, 1997 in the principal face amount
of $80,000,000.00 executed by Pledgor payable to the order of NationsBank of
Texas, N.A., and any and all renewals, extensions and rearrangements thereof;
iii. Toronto Dominion Promissory Note: All debt arising under that
certain Revolving Credit Note dated July 23, 1997 in the principal face amount
of $50,000,000.00 executed by Pledgor payable to the order of Toronto Dominion
(Texas), Inc., and any and all renewals, extensions and rearrangements thereof;
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iv. All costs and expenses incurred by Secured Party, including
attorney's fees, to obtain, preserve, perfect, enforce and defend this Agreement
and maintain, preserve, collect and realize upon the Collateral, together with
interest thereon at the default rate provided in the Loan Agreement; and
v. All amounts which may be owed to Secured Party or any of the
Lenders pursuant to the Loan Documents, or any other documents executed in
connection with the indebtedness described in subpart i. above.
In the event any amount paid to Secured Party, or any of the Lenders, on any
Obligation is subsequently recovered from Secured Party or any of the Lenders in
or as a result of any bankruptcy, insolvency or fraudulent conveyance proceeding
involving an obligor of the Obligation other than Pledgor, Pledgor shall be
liable to the party from whom such amounts were recovered for the amounts so
recovered up to the fair market value of the Collateral whether or not the
Collateral has been released or the security interest terminated. In the event
the Collateral has been released or the security interest terminated, the fair
market value of the Collateral shall be determined, at the option of the party
from whom such amounts were recovered, as of the date the Collateral was
released, the security interest terminated, or said amounts were recovered.
B. Use of Proceeds. The proceeds of any indebtedness or obligation
secured by the Collateral may be used directly or indirectly to purchase or
carry any "margin stock" as that term is defined in Regulation U of the Board of
Governors of the Federal Reserve System, or extend credit to or invest in other
parties for the purpose of purchasing or carrying any such "margin stock," or to
reduce or retire any indebtedness incurred for such purpose or otherwise in a
manner which would not violate Regulations G, T or U of the Board of Governors
of the Federal Reserve System.
4. Pledgor's Warranties. Pledgor hereby represents and warrants to Secured
Party as follows:
A. Financing Statements. Except as may be noted by schedule attached
hereto and incorporated herein by reference, no financing statement covering the
Collateral is or will be on file in any public office, except the financing
statements relating to this security interest, and no security interest, other
than the one herein created, has attached or been perfected in the Collateral or
any part thereof.
B. Ownership. Pledgor owns, or will use the proceeds of any loans by
Lenders to become the owner of, the Collateral free from any setoff, claim,
restriction, lien, security interest or encumbrance except liens for taxes not
yet due and payable and the security interest hereunder.
C. Power and Authority. Pledgor has full power and authority to make
this Agreement, and all necessary consents and approvals of any persons,
entities, governmental or regulatory authorities and securities exchanges have
been obtained to effectuate the validity of this Agreement.
D. Pledged Share Characteristics. The Pledged Shares which have been
pledged by Pledgor to Secured Party under this Agreement, or may hereafter be
pledged under this Agreement, satisfy and shall satisfy each of the requirements
and characteristics set forth on Schedule II hereto.
The delivery at any time by Pledgor to Secured Party of additional Pledged
Shares shall constitute a representation and warranty by Pledgor that, with
respect to such Pledged Shares, and each item thereof, the matters heretofore
warranted in clauses (A) through (D) immediately above are true and correct at,
and as if they were made at, the date of such delivery.
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5. Pledgor's Covenants. Until full payment and performance of all of the
Obligation and termination or expiration of any obligation or commitment of
Lenders to make advances or loans to Pledgor, unless Secured Party otherwise
consents in writing:
A. Obligation and This Agreement. Pledgor shall perform all of its
agreements herein and in any other agreements between it, Secured Party and any
of the Lenders.
B. Ownership of Collateral. Pledgor shall defend the Collateral against
all claims and demands of all persons at any time claiming any interest therein
adverse to Secured Party. Pledgor shall keep the Collateral free from all liens
and security interests except those for taxes not yet due and payable and the
security interest hereby created.
C. Secured Party's Costs. Pledgor shall pay all costs necessary to
obtain, preserve, perfect, defend and enforce the security interest created by
this Agreement, collect the Obligation, and preserve, defend, enforce and
collect the Collateral, including but not limited to taxes, assessments,
reasonable attorney's fees, legal expenses and expenses of sales. Whether the
Collateral is or is not in Secured Party's possession, and without any
obligation to do so and without waiving Pledgor's default for failure to make
any such payment, Secured Party at its option may pay any such costs and
expenses and discharge encumbrances on the Collateral, and such payments shall
be a part of the Obligation and bear interest at the rate set out in the
Obligation. Pledgor agrees to reimburse Secured Party on demand for any costs so
incurred.
D. Information and Inspection. Pledgor shall (i) promptly furnish
Secured Party any information with respect to the Collateral reasonably
requested by Secured Party; (ii) allow Secured Party or its representatives to
inspect and copy, or furnish Secured Party or its representatives with copies
of, all records relating to the Collateral and the Obligation; and (iii)
promptly furnish Secured Party or its representatives with any other information
Secured Party may reasonably request.
E. Additional Documents. Pledgor shall sign and deliver any papers
furnished by Secured Party which are necessary or desirable in the judgment of
Secured Party to obtain, maintain and perfect the security interest hereunder
and to enable Secured Party to comply with any federal or state law in order to
obtain or perfect Secured Party's interest in the Collateral or to obtain
proceeds of the Collateral.
F. Notice of Changes. Pledgor shall notify Secured Party immediately of
(i) any material change in the Collateral, (ii) a change in Pledgor's residence
or location, (iii) a change in any matter warranted or represented by Pledgor in
this Agreement, in any of the other Loan Documents, or any other document or
instrument relating to the Obligation or furnished to Secured Party pursuant to
this Agreement, and (iv) the occurrence of an Event of Default under this
Agreement or any of the other Loan Documents.
G. Possession of Collateral. Pledgor shall deliver a copy of this
Agreement (or other notice acceptable to Secured Party) to any broker, financial
intermediary, or any other person in possession of any of the Collateral or on
whose books the interest of Pledgor in the Collateral appears, and such delivery
shall constitute notice to such person of Secured Party's security interest in
the Collateral and shall constitute Pledgor's instruction to such person to note
Secured Party's security interest on their books and records, or deliver to
Secured Party certificates or other evidence of the Collateral promptly upon
Secured Party's request. Pledgor shall deliver all investment securities and
other instruments and documents which are a part of the Collateral and in
Pledgor's possession to Secured Party immediately, or if hereafter acquired,
immediately following acquisition, in a form suitable for transfer by delivery
or accompanied by duly executed instruments of transfer or assignment in blank
with signatures appropriately guaranteed in form and substance suitable to
Secured Party.
H. Change of Name/Status. Pledgor shall not change his name or use any
trade name.
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I. Power of Attorney. Pledgor appoints Secured Party and any officer
thereof as Pledgor's attorney-in-fact with full power in Pledgor's name and on
Pledgor's behalf to do every act which Pledgor is obligated to do or may be
required to do hereunder; however, nothing in this paragraph shall be construed
to obligate Secured Party to take any action hereunder nor shall Secured Party
be liable to Pledgor for failure to take any action hereunder. This appointment
shall be deemed a power coupled with an interest and shall not be terminable as
long as the Obligation is outstanding and shall not terminate on the disability
or incompetence of Pledgor. Without limiting the generality of the foregoing,
Secured Party shall have the right and power to receive, endorse and collect all
checks and other orders for the payment of money made payable to Pledgor
representing any dividend, interest payment or other distribution payable in
respect of the Collateral or any part thereof; provided, however, prior to the
occurrence of an Event of Default, Pledgor may retain any dividends paid on the
Collateral.
J. Other Parties and Other Collateral. No renewal or extensions of or
any other indulgence with respect to the Obligation or any part thereof, no
modification of the document(s) evidencing the Obligation, no release of any
security, no release of any person (including any maker, indorser, guarantor or
surety) liable on the Obligation, no delay in enforcement of payment, and no
delay or omission or lack of diligence or care in exercising any right or power
with respect to the Obligation or any security therefor or guaranty thereof or
under this Agreement shall in any manner impair or affect the rights of Secured
Party under any law, hereunder, or under any other agreement pertaining to the
Collateral. Secured Party need not file suit or assert a claim for personal
judgment against any person for any part of the Obligation or seek to realize
upon any other security for the Obligation, before foreclosing or otherwise
realizing upon the Collateral. Pledgor waives any right that can be waived to
the benefit of or to require or control application of any other security or
proceeds thereof, and agrees that Secured Party shall have no duty or obligation
to Pledgor to apply to the Obligation any such other security or proceeds
thereof.
K. Waivers by Pledgor. Pledgor waives notice of the creation, advance,
increase, existence, extension or renewal of, and of any indulgence with respect
to, the Obligation; waives presentment, demand, notice of dishonor, and protest;
waives notice of acceleration (or intent to accelerate) of the Obligation;
waives notice of the amount of the Obligation outstanding at any time, notice of
any change in financial condition of any person liable for the Obligation or any
part thereof, notice of any Event of Default, and all other notices respecting
the Obligation; and agrees that maturity of the Obligation and any part thereof
may be accelerated, extended or renewed one or more times by Secured Party in
its discretion, without notice to Pledgor. Pledgor waives any right to require
that any action be brought against any other person or to require that resort be
had to any other security or to any balance of any deposit account. Pledgor
further waives any right of subrogation or to enforce any right of action
against any other pledgor until the Obligation is paid in full.
L. Additional Provisions. If one or more Riders to this Agreement are
executed by Pledgor, the covenants and provisions of each such Rider shall be
incorporated by reference into this Agreement.
M. Rule 144 Rider. The Collateral is comprised in whole or in part of
control and/or restricted securities, which shall be subject to the additional
terms and provisions described on the Rule 144 Rider attached hereto and made a
part hereof for all purposes.
6. Maintenance of Collateral.
A. Maintenance of Collateral. At all times during the term of the
Agreement, Pledgor agrees to maintain as security for the Obligation Collateral
of a type described on Schedule II with an Adjusted Collateral Value (as
determined herein) in excess of the unpaid principal balance of the Obligation.
The
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Adjusted Collateral Value shall be determined by multiplying the Collateral
Value (as defined in subparagraph B below) by the Margin Call Percentage shown
on Schedule II.
In addition, no advance requested by Pledgor shall be made to Pledgor if
the sum of (i) the outstanding principal balance of the Obligation plus (ii) the
amount of the advance requested, equals or exceeds the sum of the amounts
determined by multiplying the Collateral Value by the Original Advance
Percentage for each type of Collateral securing the Obligation.
B. Value of Collateral. The "Collateral Value" of Collateral shall be
determined at any given time as follows:
i. If stock, the Collateral Value shall be determined by
multiplying (i) the per share price of such stock at the most recent close of
trading on a trading exchange for such stock, times (ii) the number of shares of
such stock held by Secured Party as Collateral. In the event that stock held as
Collateral is not traded on an exchange, the Collateral Value of such stock
shall be determined by obtaining the quoted value of such stock from a reputable
brokerage firm selected by Secured Party. If no such quote is available, the
value will be determined by Secured Party in its sole discretion.
ii. If a mutual fund, the Collateral Value shall be determined by
multiplying (i) the most recent per share net asset value of such mutual fund
obtained from the Wall Street Journal, times (ii) the number of shares of such
mutual fund held by Secured Party as Collateral. In the event that such net
asset value is not available in the Wall Street Journal, the Collateral Value
shall be the value quoted to Secured Party by a reputable brokerage firm
selected by Secured Party.
iii. If corporate bonds, the Collateral Value shall be determined
from the most recent closing price for such bonds obtained from the Wall Street
Journal. If such closing price is not available in the Wall Street Journal, the
Collateral Value shall be the value quoted to Secured Party by a reputable
brokerage firm selected by Secured Party.
iv. If government or agency obligations or bonds, the Collateral
Value shall be determined from the most recent closing bid price for such bonds
obtained from the Wall Street Journal. If such closing bid price is not
available in the Wall Street Journal, the Collateral Value shall be the value
quoted to Secured Party by a reputable brokerage firm selected by Secured Party.
v. If other than stock, mutual funds, corporate bonds, or
government or agency obligations or bonds, the Collateral Value shall be
determined by the Secured Party in its sole discretion.
C. Breach of Collateral Maintenance. If Pledgor fails to maintain
Collateral with an Adjusted Collateral Value as set forth above, the Pledgor
shall have two Business Days from the date Pledgor is notified by Secured Party
(in writing or orally) of such noncompliance, to either pledge additional
Collateral satisfactory to Secured Party, in its sole discretion, or reduce the
unpaid principal balance of the Obligation such that, in either case, the unpaid
principal balance of the Obligation is less than the sum of the amounts
determined by multiplying the Collateral Value by the Original Advance
Percentage shown on Schedule II. Any reduction in unpaid principal of the
Obligation shall not affect or reduce any future principal payments due except
to the extent such reductions are applied in accordance with the documents
evidencing or securing the Obligation. In the event Pledgor fails to comply with
the terms hereof, Secured Party may, without any further notice of any kind,
exercise any of the following rights and remedies, at Secured Party's option:
(a) The rights and remedies set out in Section 8.B. of this Agreement,
including without limitation the right to accelerate the Obligation and
liquidate the Collateral.
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(b) Sell all or any part of the Collateral and apply the proceeds of
such sale to the Obligation to bring the Obligation back into compliance
(that is, to reduce the unpaid principal of the Obligation such that the
unpaid principal of the Obligation is less than the sum of the amounts
determined by multiplying the Collateral Value by the Original Advance
Percentage shown on Schedule II.
If an Event of Default exists hereunder and the Collateral is declining in value
or threatens to decline speedily in value, Secured Party shall have no
obligation to notify Pledgor of the failure to maintain Collateral with an
Adjusted Collateral Value as set forth in subparagraph A above or to provide
Pledgor with an opportunity to cure such noncompliance, and in such case Pledgor
agrees that Secured Party may immediately at Secured Party's sole option (i)
declare amounts due under the Obligation to be immediately due and payable,
and/or (ii) sell all or any part of the Collateral and apply the proceeds of
such Collateral to the Obligation.
D. Sale or Substitution of Collateral. If no Event of Default has
occurred under this Agreement, Pledgor may, provided none of the following
actions would result in the occurrence of an Event of Default: (i) sell, trade,
or withdraw any part of the Collateral; or (ii) substitute new Collateral for
existing Collateral, provided that, in either event, the new Collateral shall be
acceptable to Secured Party in its sole discretion and the unpaid principal
balance of the Obligation shall be less than the sum of the amounts determined
by multiplying the Collateral Value by the Original Advance Percentage for each
type of Collateral securing the Obligation.
7. Rights and Powers of Secured Party.
A. General. Secured Party, before or after default, without liability
to Pledgor may: take control of proceeds, including stock received as dividends
or by reason of stock splits; release the Collateral in its possession to
Pledgor, temporarily or otherwise; require additional Collateral; and reject as
unsatisfactory any property hereafter offered by Pledgor as Collateral. Other
than the exercise of reasonable care to ensure the safe custody of the
Collateral in Secured Party's possession, Secured Party shall have no
obligation, duty or responsibility for the Collateral and specifically, without
limiting the foregoing, shall have no obligation, duty or responsibility to
collect any amounts payable, or exercise any right or option, in respect of the
Collateral or to sell all or any portion of the Collateral to avoid market loss.
Secured Party shall not be liable for failure to collect any account or
instruments, or for any act or omission on the part of Secured Party, its
officers, agents or employees, except for its or their own willful misconduct or
gross negligence. The foregoing rights and powers of Secured Party will be in
addition to, and not a limitation upon, any rights and powers of Secured Party
given by law, elsewhere in this Agreement, or otherwise.
B. Convertible Collateral. Before or after the occurrence of an Event
of Default, Secured Party may present for conversion any Collateral which is
convertible into any other instrument or investment security or a combination
thereof with cash; provided, however, that: (i) Secured Party shall provide
Pledgor with notice if any of the Collateral is presented for conversion, but
such notice shall not be a condition precedent to Secured Party taking such
action; and (ii) prior to the occurrence of an Event of Default, Secured Party
agrees that it shall not convert (a) Tele-Communications, Inc. ("TCI") Series B
Common Stock into TCI Series A Common Stock; and (b) TCI Liberty Media Group
Series B Common Stock into TCI Liberty Media Group Series A Common Stock.
Secured Party shall have no obligation to present any Collateral for conversion.
C. Voting Rights. Subject to the following sentence, the Pledgor shall
be entitled to exercise any and all voting and/or consensual rights and powers
relating or pertaining to the Collateral or any part thereof for any purpose not
inconsistent with the terms of this Agreement. Upon (i) the occurrence after the
date hereof of an Event of Default and (ii) the giving of written notice by
Secured Party to Pledgor of its intention to (A) foreclose upon or otherwise
dispose of the Collateral or (B) exercise its voting rights pertaining to the
Collateral, all rights of the Pledgor to exercise the voting and/or consensual
rights and
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powers which it is entitled to exercise hereunder shall cease, at the option of
Secured Party, and all such rights shall thereupon become vested in Secured
Party who shall have the sole and exclusive right and authority to exercise such
voting and/or consensual rights and powers.
8. Default.
A. Event of Default. An event of default ("Event of Default") shall
occur if: (a) Pledgor or any other obligor on all or part of the Obligation
shall fail to timely and properly pay or observe, keep or perform any term,
covenant, agreement or condition in this Agreement or in any other agreement
between Pledgor and Secured Party or between Secured Party and any other obligor
on the Obligation, including but not limited to any other note or instrument,
loan agreement, security agreement, deed of trust, mortgage, promissory note,
assignment or other agreement or instrument concerning the Obligation; or (b) an
Event of Default shall occur under the Loan Agreement or any of the other Loan
Documents. Pledgor agrees that, among its other covenants and agreements
contained herein, the failure to maintain Collateral with an Adjusted Collateral
Value as set forth in Section 6 hereof shall constitute an Event of Default
under this Agreement and the Loan Agreement.
B. Rights and Remedies. If any Event of Default shall occur, then, in
each and every such case, Secured Party may, without (a) presentment, demand, or
protest, (b) notice of default, dishonor, demand, non-payment, or protest, (c)
notice of intent to accelerate all or any part of the Obligation, (d) notice of
acceleration of all or any part of the Obligation, or (e) notice of any other
kind, all of which Pledgor hereby expressly waives (except for any notice
required under this Agreement, any of the other Loan Documents or which may not
be waived under applicable law), at any time thereafter exercise and/or enforce
any of the following rights and remedies, at Secured Party's option:
i. Acceleration. Declare the Obligation immediately due and
payable, and the obligation, if any, of Secured Party to permit further
borrowings under the Obligation shall at Secured Party's option immediately
cease and terminate.
ii. Liquidation of Collateral. Subject to applicable securities
laws, sell, or instruct any agent or broker to sell, all or any part of the
Collateral in a public or private sale, direct any agent or broker to liquidate
all or any part of any account and deliver all proceeds thereof to Secured
Party, and apply all proceeds to the payment of any or all of the Obligation in
such order and manner as Secured Party shall, in its discretion, choose. Secured
Party is authorized, at any sale of the Collateral, if it deems it advisable, to
restrict the prospective bidders or purchasers to those persons who will
represent and agree that they are purchasing for their own account, for
investment, and not with a view to distribution or sale of any of the
Collateral. Secured Party shall have no obligation to disclose or provide any
information concerning the Issuers or the Collateral to prospective purchasers
of the Collateral other than information in its possession at such time.
iii. Uniform Commercial Code. All of the rights, powers and
remedies of a secured creditor under the Uniform Commercial Code ("UCC") as
adopted in the jurisdiction to which Secured Party is subject under this
Agreement. Pledgor acknowledges and agrees that the Collateral is customarily
sold on a recognized market and accordingly Secured Party may sell the
Collateral without prior notification, advertisement or notice of any kind at
any broker's board or securities exchange.
iv. Right of Set Off. Without notice or demand to Pledgor, set
off and apply against any and all of the Obligation any and all deposits
(general or special, time or demand, provisional or final) and any other
indebtedness, at any time held or owing by Secured Party, by any of the Lenders,
or by any of their respective affiliates or correspondents to or for the credit
of the account of Pledgor or any guarantor or indorser of Pledgor's Obligation.
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v. Additional Remedies. Without liability to Pledgor: take
control of funds generated by the Collateral, such as cash dividends, interest
and proceeds, and use same to reduce any part of the Obligation and exercise all
other rights which an owner of such Collateral may exercise; and at any time
transfer any of the Collateral or evidence thereof into its own name or that of
its nominee.
Pledgor specifically understands and agrees that any sale by Secured Party of
all or part of the Collateral pursuant to the terms of this Agreement may be
effected by Secured Party at times and in manners which could result in the
proceeds of such sale as being significantly and materially less than might have
been received if such sale had occurred at different times or in different
manners, and Pledgor hereby releases Secured Party and its officers and
representatives from and against any and all obligations and liabilities arising
out of or related to the timing or manner of any such sale.
If, in the opinion of Secured Party, there is any question that a public sale or
distribution of any Collateral will violate any state or federal securities law,
Secured Party may offer and sell such Collateral in a transaction exempt from
registration under federal securities law, and any such sale made in good faith
by Secured Party shall be deemed "commercially reasonable."
9. General.
A. Parties Bound. Secured Party's rights hereunder shall inure to the
benefit of Secured Party, any of the Lenders, and their respective successors
and assigns, and in the event of any assignment or transfer of any of the
Obligation or the Collateral, Secured Party thereafter shall be fully discharged
from any responsibility with respect to the Collateral so assigned or
transferred, but Secured Party shall retain all rights and powers hereby given
with respect to any of the Obligation or the Collateral not so assigned or
transferred. All representations, warranties and agreements of Pledgor if more
than one are joint and several and all shall be binding upon the personal
representatives, heirs, successors and assigns of Pledgor.
B. Waiver. No delay of Secured Party in exercising any power or right
shall operate as a waiver thereof; nor shall any single or partial exercise of
any power or right preclude other or further exercise thereof or the exercise of
any other power or right. No waiver by Secured Party of any right hereunder or
of any default by Pledgor shall be binding upon Secured Party unless in writing,
and no failure by Secured Party to exercise any power or right hereunder or
waiver of any default by Pledgor shall operate as a waiver of any other or
further exercise of such right or power or of any further default. Each right,
power and remedy of Secured Party as provided for herein or in any of the other
Loan Documents, or which shall now or hereafter exist at law or in equity or by
statute or otherwise, shall be cumulative and concurrent and shall be in
addition to every other such right, power or remedy. The exercise or beginning
of the exercise by Secured Party of any one or more of such rights, powers or
remedies shall not preclude the simultaneous or later exercise by Secured Party
of any or all other such rights, powers or remedies.
C. Agreement Continuing. This Agreement shall constitute a continuing
agreement applying to all future as well as existing transactions, whether or
not of the character contemplated at the date of this Agreement, and if all
transactions between Secured Party and Pledgor shall be closed at any time,
shall be equally applicable to any new transactions thereafter. Provisions of
this Agreement, unless by their terms exclusive, shall be in addition to other
agreements between the parties. Time is of the essence of this Agreement.
D. Definitions. Unless the context indicates otherwise, definitions in
the UCC apply to words and phrases in this Agreement; if UCC definitions
conflict, Articles 8 and/or 9 definitions apply.
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E. Notice. Notice shall be deemed reasonable if mailed postage prepaid
at least 5 days before the related action (or if the UCC elsewhere specifies a
longer period, such longer period) to the address of Pledgor given above. Each
notice, request and demand shall be deemed given or made, if sent by mail, upon
the earlier of the date of receipt or five (5) days after deposit in the U.S.
Mail, first class postage prepaid, or if sent by any other means, upon delivery.
F. Modifications. No provision hereof shall be modified or limited
except by a written agreement expressly referring hereto and to the provisions
so modified or limited and signed by Pledgor and Secured Party. The provisions
of this Agreement shall not be modified or limited by course of conduct or usage
of trade.
G. Partial Invalidity. The unenforceability or invalidity of any
provision of this Agreement shall not affect the enforceability or validity of
any other provision herein, and the invalidity or unenforceability of any
provision of any of the Loan Documents to any person or circumstance shall not
affect the enforceability or validity of such provision as it may apply to other
persons or circumstances.
H. Applicable Law and Venue. This Agreement has been delivered in
the State of Texas and shall be construed in accordance with the laws of that
State. It is performable by Pledgor in the county or city of Secured Party's
address set out above and Pledgor expressly waives any objection as to venue in
any such location. Wherever possible each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provisions
or the remaining provisions of this Agreement.
I. Financing Statement. To the extent permitted by applicable law, a
carbon, photographic or other reproduction of this Agreement or any financing
statement covering the Collateral shall be sufficient as a financing statement.
J. ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES
-----------
HERETO INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS (INCLUDING BUT NOT LIMITED TO THE LOAN DOCUMENTS), INCLUDING ANY CLAIM
BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL BE DETERMINED BY BINDING
ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION ACT (OR IF NOT
APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND PROCEDURE FOR
THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR ANY SUCCESSOR
THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN THE EVENT OF
ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON ANY
ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY TO
THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A SUMMARY
OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR CLAIM TO
WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH ACTION.
i. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE
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COUNTY OF PLEDGOR'S DOMICILE AT THE TIME OF THE EXECUTION OF THIS INSTRUMENT,
AGREEMENT OR DOCUMENT AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN
ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE
ARBITRATION, THEN THE AMERICAN ARBITRATION
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ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90
DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY, UPON A
SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP
TO AN ADDITIONAL 60 DAYS.
ii. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION
---------------------
SHALL BE DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE
STATUTES OF LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT,
AGREEMENT OR DOCUMENT; OR (II) BE A WAIVER BY SECURED PARTY OF THE PROTECTION
AFFORDED TO IT BY 12 U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW;
OR (III) LIMIT THE RIGHT OF SECURED PARTY HERETO (A) TO EXERCISE SELF HELP
REMEDIES SUCH AS (BUT NOT LIMITED TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY
REAL OR PERSONAL PROPERTY COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL
OR ANCILLARY REMEDIES SUCH AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF
POSSESSION OR THE APPOINTMENT OF A RECEIVER. SECURED PARTY MAY EXERCISE SUCH
SELF HELP RIGHTS, FORECLOSE UPON SUCH PROPERTY, OR OBTAIN SUCH PROVISIONAL OR
ANCILLARY REMEDIES BEFORE, DURING OR AFTER THE PENDENCY OF ANY ARBITRATION
PROCEEDING BROUGHT PURSUANT TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER
THIS EXERCISE OF SELF HELP REMEDIES NOR THE INSTITUTION OR MAINTENANCE OF AN
ACTION FOR FORECLOSURE OR PROVISIONAL OR ANCILLARY REMEDIES SHALL CONSTITUTE A
WAIVER OF THE RIGHT OF ANY PARTY, INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO
ARBITRATE THE MERITS OF THE CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH
REMEDIES.
K. Controlling Document. To the extent that this Agreement conflicts
with or is in any way incompatible with any of the other Loan Documents, any
promissory note shall control over any other document, and if such promissory
note does not address an issue, then each other loan document shall control to
the extent that it deals most specifically with an issue.
NOTICE OF FINAL AGREEMENT.
THIS WRITTEN AGREEMENT AND ANY OTHER LOAN DOCUMENTS EXECUTED IN CONNECTION
HEREWITH REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[Remainder of page intentionally blank; signature pages follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their duly authorized representatives as of the date first above
written.
Agent/Secured Party: Pledgor(s)/Debtor(s):
NationsBank of Texas, N.A., Agent
By: /s/ Xxxxxxxx Xxxxx, III /s/ Xxxx X. Xxxxxx
------------------------------------ -----------------------
Xxxxxxxx Xxxxx, III, Senior Vice President Xxxx X. Xxxxxx
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SCHEDULE I
TO
PLEDGE AGREEMENT
11,500,000 shares of Tele-Communications, Inc. Series B TCI Group Common Stock,
in the name of "Xxxx X. Xxxxxx", CUSIP Number 00000X000; and 3,084,358 shares of
Tele-Communications, Inc. Series B Liberty Media Group Common Stock, in the name
of "Xxxx X. Xxxxxx", CUSIP Number 00000X000, as evidenced by the following:
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Issuer Certificate Number Number of Shares
--------------------------------------------------------------------------------
Tele-Communications, Inc. TB6384 11,500,000
Series B TCI Group
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Tele-Communications, Inc. LB0649 416,666
Series B Liberty Media Group
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Tele-Communications, Inc. LB0651 2,251,026
Series B Liberty Media Group
--------------------------------------------------------------------------------
Tele-Communications, Inc. LB0652 416,666
Series B Liberty Media Group
--------------------------------------------------------------------------------
Pledgor(s)/Debtor(s):
---------------------------
Xxxx X. Xxxxxx
SCHEDULE II
TO
PLEDGE AGREEMENT
1. Type of Collateral:
Tele-Communications, Inc.Series A or B, TCI Group Common Stock;
Tele-Communications, Inc.Series A or B Liberty Media Group Common Stock; and
Tele-Communications, Inc.Series A or B TCI Ventures Group Common Stock; which
(1) are validly issued, fully paid and non-assessable;
(2) are owned of record and beneficially by Pledgor, and represented by
stock certificates issued in the name of Pledgor properly endorsed to Secured
Party;
(3) may be sold by Secured Party, pursuant to the terms of the Pledge
Agreement;
(4) are traded on the New York Stock Exchange, American Stock Exchange
or the NASDAQ national market system (each a "Recognized Market"); and
(5) have been delivered and pledged to Secured Party pursuant to the
Pledge Agreement.
2. Margin Call Percentage: Sixty percent (60%).
3. Original Advance Percentage: Fifty percent (50%).
SCHEDULE III
PLEDGE CERTIFICATE
Reference is hereby made to that certain Pledge Agreement dated as of July
23, 1997 (the "Pledge Agreement"), between Xxxx X. Xxxxxx ("Pledgor") and
NationsBank of Texas, N.A., a national banking association, in its capacity as
Agent for itself and the Lenders (in such capacity, referred to herein as
"Secured Party"). This Pledge Certificate is delivered pursuant to Section 2 of
the Pledge Agreement. All capitalized terms used and not otherwise defined
herein shall have their respective meanings as set forth in the Pledge
Agreement.
Pledgor hereby certifies that concurrently with the delivery of this Pledge
Certificate,
[_] Pledgor is delivering to Secured Party the following items of
Collateral as additional Collateral for the Obligation (collectively, the
"Additional Collateral"):
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[_] Pledgor is selling or otherwise disposing of the following items of
Collateral:
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------------------, and Pledgor is delivering to Secured Party the
following items of Collateral being substituted therefor:
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------------------- (collectively, the "Substituted Collateral").
With respect to each of the items of Additional Collateral or Substituted
Collateral, as the case may be, Pledgor acquired such item, and has borne all
economic risks thereto, since the following date or dates:
----------------------------------------------------
Pledgor hereby acknowledges that Pledgor has granted to Secured Party, for
the benefit of Lenders, a security interest in the Additional Collateral and/or
Substituted Collateral pursuant to the Pledge Agreement to secure the Obligation
and that the Collateral covered by the Pledge Agreement includes, without
limitation, the Substituted Collateral and Additional Collateral. Pledgor hereby
represents and warrants that all of the representations and warranties contained
in the Pledge Agreement are true and correct in all material respects, including
with respect to the Additional Collateral and Substituted Collateral, on the
date hereof as though made as of the date hereof.
EXECUTED this ______ day of _____________,19__.
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Xxxx X. Xxxxxx
RULE 144 RIDER
--------------
This Rule 144 Rider is made this 23rd day of July, 1997 and is incorporated
into and shall be deemed to supplement the Pledge Agreement ("Agreement") of the
same date given by Pledgor to secure the Obligation to Secured Party. Terms used
and not otherwise defined in this Rider which are defined in the Agreement have
the meanings given them in the Agreement.
1. The securities listed on Schedule I to the Agreement, which Schedule
is made a part of this Rider and the Agreement for all purposes, are or may
be deemed (check one or more boxes):
[X] Restricted securities
[X] Control securities
for purposes of Rule 144 of the General Regulations under the Securities
Act of 1933 ("Rule 144") promulgated by the Securities and Exchange
Commission. These securities ("Rule 144 Securities") comprise all or part
of the Collateral held by Secured Party presently subject to the terms and
conditions of the Agreement and this Rider.
2. Pledgor represents and warrants that (i) Pledgor acquired the Rule 144
Securities, and held such securities, for a period of at least two (2)
years prior to the date hereof, for purposes of determining the holding
period of the Rule 144 Securities under Rule 144, and Borrower has borne
the full economic risks of such securities since their respective dates of
acquisition; (ii) the Rule 144 Securities are free and clear of all liens
(except for liens, encumbrances and debt held by Secured Party)
encumbrances and debt.
3. Pledgor covenants and agrees that:
a. Pledgor will cooperate fully with Secured Party with respect to
any sale by Secured Party of any of the Rule 144 Securities, including
full and complete compliance with all requirements of Rule 144, and
will give to Secured Party all information and will do all things
necessary, including the execution of all documents, forms,
instruments and other items, to comply with Rule 144 for the complete
and unrestricted sale and/or transfer of the Rule 144 Securities and
will exercise its best efforts to have the issuer of such securities,
upon the request of Secured Party, take all such action as may be
required to satisfy the public information requirements of Rule
144(c).
b. Pledgor will not: (i) approve or consent to any amendment of the
articles of incorporation or charter of any issuer of the Rule 144
Securities that may materially adversely affect the value of the Rule
144 Securities; or (ii) permit any issuer of the Rule 144 Securities
to merge or consolidate with or into any corporation or other person,
without the prior written consent of Secured Party if such merger or
consolidation would extend any holding period under Rule 144 with
respect to such Rule 144 Securities or otherwise adversely affect
Secured Party's ability to sell or otherwise dispose of such
securities in reliance on Rule 144(k), and the interpretations thereof
by the Securities and Exchange Commission.
c. Pledgor will use its best efforts, upon Secured Party's written
request, to obtain and publish or have issuer publish all information
necessary to satisfy Rule 144 in the event any issuer of the Rule 144
Securities is not current in its filings under the Securities Exchange
Act of 1934 at the time of a foreclosure sale by Secured Party.
4. In the event any issuer of the Rule 144 Securities defaults in its
reporting obligations under the Securities Exchange Act of 1934, Secured
Party may require Pledgor to substitute new Collateral satisfactory to
Secured Party in its discretion for such securities.
By signing below, Pledgor accepts and agrees to the terms and covenants
contained in this Rider.
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Xxxx X. Xxxxxx
