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COMPANY PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (this "Agreement") dated as of June 26, 1998, is
between SANTI GROUP, INC., a Delaware corporation (the "Company"), and BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION ("BofA"), as Agent (as defined
below) for the Banks (as defined below).
W I T N E S S E T H:
WHEREAS, the Company, various financial institutions (the "Banks") and
BofA, as agent for the Banks (in such capacity, the "Agent"), have entered into
a Credit Agreement dated as of June __, 1998 (as amended, restated or otherwise
modified from time to time, the "Credit Agreement"); and
WHEREAS, the obligations of the Company in respect of the Credit
Agreement and the other Loan Documents (as defined in the Credit Agreement) are
to be secured pursuant to this Agreement;
NOW, THEREFORE, for and in consideration of the premises and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Definitions. When used herein, (a) the capitalized terms used but
not defined have the meanings assigned to such terms in the Credit Agreement and
(b) the following terms have the following meanings (such meanings to be
applicable to both the singular and plural forms of such terms):
Agent - see the recitals.
Agreement - see the introductory paragraph.
BofA - see the introductory paragraph.
Banks - see the recitals.
Collateral - see Section 2.
Company - see the introductory paragraph.
Credit Agreement - see the recitals.
Default means the occurrence of any of the following events:
(i) any Unmatured Event of Default with respect to the Company under
Section 12.1.4 of the Credit Agreement, (ii) any Event of Default or
(iii) any warranty of the Company herein is untrue or misleading in any
material respect and, as a result thereof, the Agent's security
interest in any material portion of the Collateral is not perfected or
the Agent's rights and remedies with respect to any material portion of
the Collateral are materially impaired or otherwise materially
adversely affected.
Guarantor means, on any day, each Subsidiary that has executed
a counterpart of the Guaranty on or prior to that day (or is required
to execute a counterpart of the Guaranty on that date).
Issuer means the issuer of any of the shares of stock or other
securities representing all or any of the Collateral.
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Liabilities means all obligations of the Company howsoever
created, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing, or due or to become due, which
arise out of or in connection with any of the Loan Documents
(including, without limitation, with respect to Letters of Credit), as
the same may be amended, modified, extended or renewed from time to
time, and all Hedging Obligations of the Company to any Bank.
2. Pledge. As security for the payment of all Liabilities, the
Company hereby pledges to the Agent for the benefit of the Banks, and grants to
the Agent for the benefit of the Banks a continuing security interest in, all of
the following:
A. All of the shares of stock and other securities described
in Schedule I hereto, all of the certificates and/or instruments
representing such shares of stock and other securities, and all cash,
securities, dividends, rights and other property at any time and from
time to time received, receivable or otherwise distributed in respect
of or in exchange for any or all of such shares or other securities;
B. All additional shares of stock of any of the Issuers listed
in Schedule I hereto at any time and from time to time acquired by the
Company in any manner, all of the certificates representing such
additional shares, and all cash, securities, dividends, rights and
other property at any time and from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all of
such shares;
C. All other property hereafter delivered to the Agent in
substitution for or in addition to any of the foregoing, all
certificates and instruments representing or evidencing such property,
and all cash, securities, interest, dividends, rights and other
property at any time and from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all
thereof; and
D. All products and proceeds of all of the foregoing.
All of the foregoing are herein collectively called the "Collateral".
The Company agrees to deliver to the Agent, promptly upon receipt and
in due form for transfer (i.e., endorsed in blank or accompanied by stock or
bond powers executed in blank), any Collateral (other than dividends which the
Company is entitled to receive and retain pursuant to Section 5 hereof) which
may at any time or from time to time be in or come into the possession or
control of the Company; and prior to the delivery thereof to the Agent, such
Collateral shall be held by the Company separate and apart from its other
property and in express trust for the Agent.
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3. Warranties; Further Assurances. The Company warrants to the Agent
for the benefit of each Bank that: (a) the Company is (or at the time of any
future delivery, pledge, assignment or transfer thereof will be) the legal and
equitable owner of the Collateral free and clear of all liens, security
interests and encumbrances of every description whatsoever other than the
security interest created hereunder; (b) the pledge and delivery of the
Collateral pursuant to this Agreement will create a valid perfected security
interest in the Collateral in favor of the Agent; (c) all shares of stock
referred to in Schedule I hereto are duly authorized, validly issued, fully paid
and non-assessable; (d) as to each Issuer whose name appears in Schedule I
hereto, the Collateral represents on the date hereof not less than the
applicable percent (as shown in Schedule I hereto) of the total shares of
capital stock issued and outstanding of such Issuer; and (e) the information
contained in Schedule I hereto is true and accurate in all respects.
So long as any of the Liabilities shall be outstanding or any
commitment shall exist on the part of any Bank with respect to the creation of
any Liabilities, the Company (i) shall not, except as permitted by the Credit
Agreement or with the express prior written consent of the Agent, sell, assign,
exchange, pledge or otherwise transfer, encumber, or grant any option, warrant
or other right to purchase the stock of any Issuer which is pledged hereunder,
or otherwise diminish or impair any of its rights in, to or under any of the
Collateral; (ii) shall execute such Uniform Commercial Code financing statements
and other documents (and pay the costs of filing and recording or re-filing and
re-recording the same in all public offices reasonably deemed necessary or
appropriate by the Agent) and do such other acts and things, all as the Agent
may from time to time reasonably request, to establish and maintain a valid,
perfected security interest in the Collateral (free of all other liens, claims
and rights of third parties whatsoever) to secure the performance and payment of
the Liabilities; (iii) will execute and deliver to the Agent such stock powers
and similar documents relating to the Collateral, satisfactory in form and
substance to the Agent, as the Agent may reasonably request; and (iv) will
furnish the Agent or any Bank such information concerning the Collateral as the
Agent or such Bank may from time to time reasonably request, and will permit the
Agent or any Bank or any designee of the Agent or such Bank, from time to time
at reasonable times and on reasonable notice (or at any time without notice
during the existence of a Default), to inspect, audit and make copies of and
extracts from all records and all other papers in the possession of the Company
which pertain to the Collateral, and will, upon request of the Agent at any time
when a Default has occurred and is continuing, deliver to the Agent all of such
records and papers.
4. Holding in Name of Agent, etc. The Agent may from time to time after
the occurrence and during the continuance of a Default, without notice to the
Company, take all or any of the following actions: (a) transfer all or any part
of the Collateral into the name of the Agent or any nominee or sub-agent for the
Agent, with or without disclosing that such Collateral is subject to the lien
and security interest hereunder, (b) appoint one or more sub-agents or nominees
for the purpose of retaining physical possession of the Collateral, (c) notify
the parties obligated on any of the Collateral to make payment to the Agent of
any amounts due or to become due thereunder, (d) endorse any checks, drafts or
other writings in the name of the Company to allow collection of the Collateral,
(e) enforce collection of any of the Collateral by
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suit or otherwise, and surrender, release or exchange all or any part thereof,
or compromise or renew for any period (whether or not longer than the original
period) any obligations of any nature of any party with respect thereto, and (f)
take control of any proceeds of the Collateral.
5. Voting Rights, Dividends, etc. (a) Notwithstanding certain
provisions of Section 4 hereof, so long as the Agent has not given the notice
referred to in paragraph (b) below:
A. The Company shall be entitled to exercise any and all
voting or consensual rights and powers and stock purchase or
subscription rights (but any such exercise by the Company of stock
purchase or subscription rights may be made only from funds of the
Company not comprising part of the Collateral) relating or pertaining
to the Collateral or any part thereof for any purpose; provided,
however, that the Company agrees that it will not exercise any such
right or power in any manner which would have a material adverse effect
on the value of the Collateral or any part thereof.
B. The Company shall be entitled to receive and retain any and
all lawful dividends payable in respect of the Collateral which are
paid in cash by any Issuer if such dividends are permitted by the
Credit Agreement, but all dividends and distributions in respect of the
Collateral or any part thereof made in shares of stock or securities or
other property or representing any return of capital, whether resulting
from a subdivision, combination or reclassification of Collateral or
any part thereof or received in exchange for Collateral or any part
thereof or as a result of any merger, consolidation, acquisition or
other exchange of assets to which any Issuer may be a party or
otherwise or as a result of any exercise of any stock purchase or
subscription right, shall be and become part of the Collateral
hereunder and, if received by the Company, shall be forthwith delivered
to the Agent in due form for transfer (i.e., endorsed in blank or
accompanied by stock or bond powers executed in blank) to be held for
the purposes of this Agreement.
C. The Agent shall execute and deliver, or cause to be
executed and delivered, to the Company, all such proxies, powers of
attorney, dividend orders and other instruments as the Company may
request for the purpose of enabling the Company to exercise the rights
and powers which it is entitled to exercise pursuant to clause (A)
above and to receive the dividends which it is authorized to retain
pursuant to clause (B) above.
(b) Upon notice from the Agent during the existence of a Default, and
so long as the same shall be continuing, all rights and powers which the Company
is entitled to exercise pursuant to Section 5(a)(A) hereof, and all rights of
the Company to receive and retain dividends pursuant to Section 5(a)(B) hereof,
shall forthwith cease, and all such rights and powers shall thereupon become
vested in the Agent which shall have, during the continuance of such Default,
the sole and exclusive authority to exercise such rights and powers and to
receive such dividends. Any and all money and other property paid over to or
received by the Agent pursuant to this paragraph (b) shall be retained by the
Agent as additional Collateral hereunder and applied in accordance with the
provisions hereof.
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6. Remedies. Whenever a Default shall exist, the Agent may exercise
from time to time any rights and remedies available to it under the Uniform
Commercial Code as in effect in Illinois or otherwise available to it. Without
limiting the foregoing, whenever a Default shall exist the Agent (a) may, to the
fullest extent permitted by applicable law, without notice, advertisement,
hearing or process of law of any kind, (i) sell any or all of the Collateral,
free of all rights and claims of the Company therein and thereto, at any public
or private sale or brokers' board and (ii) bid for and purchase any or all of
the Collateral at any such public sale and (b) shall have the right, for and in
the name, place and stead of the Company, to execute endorsements, assignments,
stock powers and other instruments of conveyance or transfer with respect to all
or any of the Collateral. The Company hereby expressly waives, to the fullest
extent permitted by applicable law, any and all notices, advertisements,
hearings or process of law in connection with the exercise by the Agent of any
of its rights and remedies during the continuance of a Default. Any notification
of intended disposition of any of the Collateral shall be deemed reasonably and
properly given if given at least ten (10) days before such disposition. Any
proceeds of any of the Collateral may be applied by the Agent to the payment of
expenses in connection with the Collateral, including, without limitation,
reasonable attorneys' fees and legal expenses, and any balance of such proceeds
may be applied by the Agent toward the payment of such of the Liabilities, and
in such order of application, as the Agent may from time to time elect (and,
after payment in full of all Liabilities, any excess shall be delivered to the
Company or as a court of competent jurisdiction shall direct).
The Agent is hereby authorized to comply with any limitation or
restriction in connection with any sale of Collateral as it may be advised by
counsel is necessary in order to (a) avoid any violation of applicable law
(including, without limitation, compliance with such procedures as may restrict
the number of prospective bidders and purchasers and/or further restrict such
prospective bidders or purchasers to persons or entities who will represent and
agree that they are purchasing for their own account for investment and not with
a view to the distribution or resale of such Collateral) or (b) obtain any
required approval of the sale or of the purchase by any governmental regulatory
authority or official, and the Company agrees that such compliance shall not
result in such sale being considered or deemed not to have been made in a
commercially reasonable manner and that the Agent shall not be liable or
accountable to the Company for any discount allowed by reason of the fact that
such Collateral is sold in compliance with any such limitation or restriction.
7. General. The Agent shall be deemed to have exercised reasonable care
in the custody and preservation of the Collateral if it takes such action for
that purpose as the Company shall request in writing, but failure of the Agent
to comply with any such request shall not of itself be deemed a failure to
exercise reasonable care, and no failure of the Agent to preserve or protect any
rights with respect to the Collateral against prior parties, or to do any act
with respect to preservation of the Collateral not so requested by the Company,
shall be deemed a failure to exercise reasonable care in the custody or
preservation of any Collateral.
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No delay on the part of the Agent in exercising any right, power or
remedy shall operate as a waiver thereof, and no single or partial exercise of
any such right, power or remedy shall preclude any other or further exercise
thereof, or the exercise of any other right, power or remedy. No amendment,
modification or waiver of, or consent with respect to, any provision of this
Agreement shall be effective unless the same shall be in writing and signed and
delivered by the Agent, and then such amendment, modification, waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
All obligations of the Company and all rights, powers and remedies of
the Agent and the Banks expressed herein are in addition to all other rights,
powers and remedies possessed by them, including, without limitation, those
provided by applicable law or in any other written instrument or agreement
relating to any of the Liabilities or any security therefor.
This Agreement has been delivered at Chicago, Illinois, and shall be
construed in accordance with and governed by the internal laws of the State of
Illinois. 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
such law, such provision shall be ineffective to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement.
All notices hereunder shall be in writing (including facsimile
transmission) and shall be sent to the applicable party at its address shown
opposite its signature hereto or at such other address as such party may, by
written notice to the other party, have designated as its address for such
purpose. Notices sent by facsimile transmission shall be deemed to have been
given when sent with confirmation of receipt; notices sent by mail shall be
deemed to have been given five Business Days after the date when sent by
registered or certified mail, postage prepaid; and notices sent by hand delivery
or overnight courier shall be deemed to have been given when received .
This Agreement shall be binding upon the Company and the Agent and
their respective successors and assigns, and shall inure to the benefit of the
Company and the Agent and the successors and assigns of the Agent.
This Agreement may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, and each such counterpart
shall be deemed an original but all such counterparts shall together constitute
but one and the same Agreement.
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, SHALL BE BROUGHT AND MAINTAINED
EXCLUSIVELY IN THE COURTS OF THE STATE OF ILLINOIS OR IN THE UNITED STATES
DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS; PROVIDED, HOWEVER, THAT
ANY
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SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE
BROUGHT, AT THE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE COMPANY HEREBY EXPRESSLY AND
IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF ILLINOIS
AND OF THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS
FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE. THE COMPANY FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE
PREPAID, TO THE ADDRESS OF THE COMPANY SPECIFIED IN, OR PURSUANT TO, THE CREDIT
AGREEMENT, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF ILLINOIS. THE
COMPANY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE
OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM
THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
EACH OF THE COMPANY, THE AGENT AND (BY ACCEPTING THE BENEFITS HEREOF)
EACH BANK HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING
TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
AND ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN
THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR ARISING FROM ANY
FINANCING RELATIONSHIP EXISTING IN CONNECTION WITH ANY OF THE FOREGOING, AND
AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT
BEFORE A JURY.
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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
as of the day and year first written above.
SANTI GROUP, INC.
Address:
By: /s/ Rock Xxxxx
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Name Printed:
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Title:
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BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent
Address:
000
Xxxxx XxXxxxx Xxxxxx By: /s/ Xxx XxXxxxx
Xxxxxxx, XX 00000 -----------------------
Name Printed:
Attention:----------------------- --------------
Facsimile:----------------------- Title:
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