EXHIBIT 10.21
PLEDGE AGREEMENT
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THIS PLEDGE AGREEMENT (this "Agreement") is made as of November 24,
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1999, by each of the undersigned pledgors and such other persons who hereinafter
become parties to this Agreement pursuant to Section 19 hereof (each, a
"Pledgor" and, collectively, the "Pledgors") in favor of GTCR Capital Partners,
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L.P., a Delaware limited partnership (the "Lender").
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WHEREAS, ZEFER Corp., a Delaware corporation (the "Borrower"), and the
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Lender have entered into that certain Loan Agreement of even date herewith (as
amended, modified or supplemented from time to time, the "Loan Agreement"),
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which is incorporated herein by reference and pursuant to which the Borrower and
the Lender have agreed that the Lender shall make Loans to the Borrower on the
terms and conditions set forth therein;
WHEREAS, each Pledgor (other than the Borrower) acknowledges that, as
a Subsidiary (as that term is defined in the Loan Agreement) of the Borrower, it
will receive substantial direct and indirect benefits and advantage by reason of
the making of the Loans to the Borrower as provided in the Loan Agreement and
that it will be to each such Pledgor's direct interest and economic benefit to
assist the Borrower in procuring said Loans from the Lender; and
WHEREAS, to induce the Lender to enter into the Loan Agreement and
make the Loans to the Borrower thereunder, in order to secure the payment and
performance by the Borrower of the Secured Obligations (as hereinafter defined
in Section 1), the Pledgors have agreed to pledge to the Lender, for the benefit
of the Lender, all of the Collateral (as hereinafter defined in Section 2) as
security for the Secured Obligations.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the Pledgors, the parties hereto agree as follows:
1. Definitions.
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1.1 Certain Defined Terms. Capitalized terms not otherwise defined herein
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which are defined in the Loan Agreement shall have the meanings set forth
therein or which are defined in the UCC shall have the meanings set forth
therein. In addition to any other terms defined elsewhere in this Agreement,
the following terms shall have the following meanings:
"Collateral" shall have the meaning assigned to that term in Section 2
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hereof.
"Equity Rights" shall have the meaning assigned to that term in
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Section 2 hereof.
"Event of Default" shall mean an Event of Default as defined in the
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Loan Agreement or any breach by any Pledgor of any representation, warranty,
covenant, agreement or term of this Agreement.
"Other Securities" shall have the meaning assigned to that term in
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Section 2 hereof.
"Pledged Securities" shall have the meaning assigned to that term in
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Section 2 hereof.
"Proceeds" shall mean all proceeds (as that term is defined in the
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UCC) and, in addition, any and all amounts or items of property, both cash and
noncash, received when any Collateral or proceeds thereof are sold, exchanged,
collected or otherwise disposed of, including proceeds of insurance, indemnity,
warranty or guarantee paid or payable on or in connection with any Collateral,
and any and all other amounts paid or payable under or in connection with any of
the Collateral.
"Secured Obligations" shall mean, collectively, (i) the Loan
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Obligations, (ii) all other liabilities, obligations and indebtedness (whether
actual or contingent, whether owed jointly or severally and whether for the
payment of money and, if for the payment of money, whether for principal,
interest, fees, expenses or otherwise) of any Borrower Entity to the Lender now
existing or hereafter incurred, whether under lines of credit, other financing
arrangements or otherwise, whether related to the Loan Agreement or the Note,
whether contemplated by the Lender or the Borrower at the date hereof and
whether direct, indirect, matured or contingent, joint or several, or otherwise,
together with any and all extensions, renewals, refinancings or refundings
thereof in whole or in part, (iii) all costs and expenses (including, without
limitation, to the extent permitted by law, reasonable attorneys' fees and other
legal expenses) incurred by the Lender in the enforcement and collection of any
of the liabilities, obligations and indebtedness referred to in clause (i) or
(ii) above, and (iv) all payments and advances made by the Lender for the
maintenance, preservation, protection or enforcement of, or realization upon,
any property or assets now or hereafter made subject to any Lien granted
pursuant to the Loan Agreement, this Agreement, the other Loan Documents or
pursuant to any other agreement, instrument or note relating to any of the
Secured Obligations (including, without limitation, advances for taxes,
insurance, storage, transportation, repairs and the like).
"UCC" shall mean the Uniform Commercial Code as in effect in any
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applicable jurisdiction.
1.2 Other Definitional Provisions. References to "Sections,""subsections,"
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"Exhibits" and "Schedules" shall be to Sections, subsections, Exhibits and
Schedules, respectively, of this Agreement unless otherwise specifically
provided. Any of the terms defined in Section 1.1 may, unless the context
otherwise requires, be used in the singular or the plural depending on the
reference. In this Agreement, "hereof," "herein," "hereto," "hereunder" and the
like mean and refer to this Agreement as a whole and not merely to the specific
section, paragraph or clause in which the respective word appears; words
importing any gender include the other gender; references to "writing" include
printing, typing, lithography and other means of reproducing words in a tangible
visible form; the words "including," "includes" and "include" shall be deemed to
be followed by the words "without limitation;" references to agreements and
other contractual instruments shall be deemed to include subsequent amendments,
assignments, and other modifications thereto, but only to the extent such
amendments, assignments and other modifications are not prohibited by the terms
of this Agreement or any other Loan Document; references to Persons include
their respective permitted successors and assigns or, in the case of
governmental Persons, Persons succeeding to the
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relevant functions of such Persons; and all references to statutes and related
regulations shall include any amendments thereto and any successor statutes and
regulations.
2. Grant of Security Interest.
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2.1 Grant. As collateral security for full and timely payment, observance
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and performance of the Secured Obligations in accordance with the terms thereof,
and to induce the Lender to extend credit to the Borrower under the Loan
Agreement, each Pledgor hereby pledges, assigns, hypothecates and transfers, and
grants to and creates in favor of the Lender a continuing security interest and
lien under the UCC in, all of such Pledgor's right, title and interest in, to
and under the following (all of which is collectively referred to herein as the
"Collateral"):
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2.1.1 all of the issued and outstanding shares of capital stock,
partnership units, limited liability company interests and other securities and
ownership interests (whether in certificated or uncertificated form) of such
Pledgor's domestic Subsidiaries and 65% of the capital stock of such Pledgor's
foreign Subsidiaries (collectively, the "Pledged Securities"), which Pledged
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Securities are listed on Schedule I hereto;
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2.1.2 all of the shares of capital stock, partnership units, limited
liability company interests and other securities and ownership interests
(whether in certificated or uncertificated form) of such Pledgor's domestic
Subsidiaries hereafter owned, directly or indirectly, by such Pledgor and 65% of
the capital stock of such Pledgor's foreign Subsidiaries hereafter owned,
directly or indirectly, by such Pledgor (collectively, the "Other Securities");
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2.1.3 all other property hereafter delivered to, or in the possession
or in the custody of, the Lender in substitution for or in addition to the
Pledged Securities;
2.1.4 all stock rights, rights with respect to partnership units or
limited liability company interests, rights to subscribe, liquidating and other
dividends and distributions, stock dividends, dividends paid in stock, new
securities, interests, options, warrants, other property and cash to which such
Pledgor is or may hereafter become entitled to receive with respect to its
interest in the Pledged Securities or the Other Securities, whether in
certificated or uncertificated form and whether in substitution or exchange or
by reason of merger, consolidation, reclassification, reorganization,
liquidation or otherwise (collectively, the "Equity Rights"), which Equity
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Rights are listed on Schedule II hereto;
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2.1.5 the certificates and other instruments described on Schedule I
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currently evidencing the Pledged Securities and any and all other certificates
and instruments now or hereafter evidencing the Pledged Securities, the Other
Securities or the Equity Rights, in each case duly endorsed in blank (or with
appropriate irrevocable stock powers duly executed in blank and undated); and
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2.1.6 all Proceeds of the foregoing.
2.2 Relative Priority of Security Interests. In furtherance of the intent
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of the parties hereto, the security interests and liens granted hereunder shall
be treated as a severable first priority security interest and lien granted to
the Lender as the lender under the Loan Agreement.
3. Delivery of Collateral. Upon the execution and delivery of this Agreement,
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each Pledgor shall deliver to the Lender or its agent all items of Collateral
then owned by or held by it in tangible form, and with respect to all items of
Collateral acquired by each Pledgor hereafter, such Pledgor shall accept such
items of Collateral as the Lender's agent, hold such items in trust for the
Lender hereunder and promptly deliver such items of Collateral to the Lender or
its agent upon such Pledgor's receipt thereof. Each certificate or instrument
representing Collateral shall be delivered to the Lender or its agent duly
endorsed in blank or together with appropriate irrevocable stock powers undated
and duly executed in blank sufficient to transfer title thereto.
4. Dividends and Other Distributions.
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4.1 Stock Dividends and Other Distributions. So long as this Agreement is
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in effect, if any Pledgor by reason of ownership of the Collateral shall become
entitled to receive, or shall receive, any Equity Rights, such Pledgor shall
accept the same as the Lender's agent and hold the same in trust for the Lender
hereunder and deliver the same promptly to the Lender in the exact form
received, with the endorsement of such Pledgor when requested by the Lender
and/or appropriate irrevocable stock powers undated and duly executed in blank,
to be held by the Lender as part of the Collateral. Any sums or property paid
upon or in respect of the Collateral or any other securities received under this
Section 4 upon the reorganization, liquidation, or dissolution of the issuer of
any of the Collateral or any such other securities shall immediately be paid
over to the Lender to be held by the Lender as additional security for the
payment of the Secured Obligations. All sums of money and property so paid or
distributed in respect of the Collateral and such other securities that are
received by any Pledgor shall, until paid or delivered to the Lender, be
segregated from the other property or funds of such Pledgor and held by such
Pledgor in trust as additional security for the payment of the Secured
Obligations. Such Pledgor shall give the Lender immediate notice of any such
distribution.
4.2 Cash Dividends and Distributions. Notwithstanding the provisions of
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Section 4.1 above, unless an Event of Default shall have occurred and be
continuing or shall exist, each Pledgor shall be entitled to receive and retain
all cash dividends and distributions declared and paid out of earnings or earned
surplus with respect to any Collateral to the extent such dividends and
distributions are permitted under the Loan Agreement. Upon the occurrence and
continuance or existence of any Event of Default or to the extent not permitted
under the Loan Agreement, the Lender shall be entitled to receive any and all
such cash dividends and distributions, and upon receipt, each Pledgor shall
accept any such cash dividends and distributions as the Lender's agent and hold
the same in trust for the Lender hereunder and shall immediately deliver any
such cash dividends or distributions to the Lender. The Lender shall hold any
such cash dividends and distributions as Collateral pursuant to this Agreement
or, at the Lender's election, shall apply
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any such cash dividends or distributions to the reduction of any Secured
Obligations then outstanding, in such order as the Lender may elect.
5. Voting and Other Rights.
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5.1 Stock Register. At any time and from time to time (i) whether before
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or after the occurrence of any Event of Default, the Lender shall be entitled to
register this Agreement on the stock ledger and/or books of record of each of
the issuers of the Collateral, and each Pledgor agrees to cause this Agreement
to be so registered, and (ii) after the occurrence of any Event of Default and
the continuance thereof, the Lender shall be entitled to register any or all of
the Collateral in its name or the name of its nominee, and each Pledgor shall
execute such assignments and other documents, and take such other acts, all at
such Pledgor's expense, as the Lender may from time to time reasonably request
to accomplish the foregoing.
5.2 Voting Rights. Unless an Event of Default shall have occurred and be
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continuing or shall exist, each Pledgor shall be entitled to vote the Collateral
and to give consents, waivers and ratifications with respect to the Collateral;
provided that no vote shall be cast, or consent, waiver or ratification given,
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or any action taken, that would impair the Collateral or be inconsistent with or
violate any provision of this Agreement or the Loan Agreement. Upon the
occurrence and continuance or during the existence of any Event of Default, the
Lender shall have the right to vote the Collateral, in all matters, and grant
consents, waivers and ratifications with respect thereto in its absolute
discretion whether the Lender has transferred the Collateral to the registered
ownership of the Lender or the Lender's nominee.
6. Representations and Warranties. Each Pledgor hereby represents, warrants,
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covenants and agrees that:
6.1 Such Pledgor is and shall be at all times the record and
beneficial owner of each item of its Collateral, and has and shall have at all
times good and marketable title thereto, free and clear of any and all liens,
charges, claims and encumbrances, except the security interest granted under
this Agreement, and such Pledgor shall defend such title against the claims and
demands of all Persons whomsoever. All of the Pledged Securities are duly
authorized, have been validly issued, and in the case of Pledged Securities
constituting capital stock, are fully paid and nonassessable.
6.2 This Agreement has been duly authorized, executed and delivered by
such Pledgor and constitutes the legal, valid and binding obligation of such
Pledgor, enforceable against such Pledgor in accordance with its terms except to
the extent that the enforceability thereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws generally
affecting creditors' rights and by equitable principles (regardless of whether
enforcement is sought in equity or at law). This Agreement creates a valid
security interest in the Collateral and, upon delivery of the Collateral to the
Lender, shall constitute a valid first priority perfected lien on or security
interest in the Collateral.
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6.3 No security agreement, financing statement, equivalent security or
lien instrument, or continuation statement covering all or any part of the
Collateral is on file or of record in any public office other than those
documents reflecting liens on the Collateral in favor of the Lender.
6.4 The certificates described on Schedule I hereto evidence all of
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the issued and outstanding partnership units, limited liability company
interests and shares of capital stock (as applicable) of each Pledgor (other
than the Borrower) and its Subsidiaries which are owned by each Pledgor as of
the date of execution of this Agreement, and each Pledgor has delivered to the
Lender all stock certificates or other instruments evidencing any of the Pledged
Securities, in each case duly endorsed in blank to the Lender (or with
appropriate irrevocable stock powers duly executed in blank and undated).
6.5 Except for the Pledged Securities and the Equity Rights, such
Pledgor does not own nor does it have the right to acquire any capital stock or
securities of or other ownership interest in any Subsidiary.
6.6 Such Pledgor's place where its records concerning the Collateral
are kept is as set forth on Schedule III hereto, and such Pledgor shall not
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change such principal place of business or remove such records unless it has
taken such action as is necessary to cause the security interest of the Lender
in the Collateral to continue to be perfected. Such Pledgor shall not change its
principal place of business or the place where its records concerning the
Collateral are kept without giving at least thirty (30) days prior written
notice thereof to the Lender.
6.7 No consent approval or authorization of or designation or filing
with any governmental authority on the part of such Pledgor is required in
connection with the pledge and security interest granted under this Agreement,
or the exercise of the Lender of the voting and other rights provided for in
this Agreement, except for the filing of UCC-1 financing statements.
6.8 The execution, delivery and performance of this Agreement by such
Pledgor will not violate any provision of any applicable law or regulation or of
any order, judgment, writ, award or decree of any court, arbitrator or
governmental authority, domestic or foreign, or of the charter or by-laws of
such Pledgor or of any securities issued by such Pledgor or of any mortgage,
indenture, lease, contract, or other agreement, instrument or undertaking to
which such Pledgor is a party or which purports to be binding upon such Pledgor
or upon any of its respective assets, and will not result in the creation or
imposition of any lien, charge or encumbrance on or security interest in any of
the assets of such Pledgor except as contemplated by this Agreement.
6.9 Such Pledgor assumes full responsibility for taking any and all
steps to preserve its and the Lender's rights with respect to the Collateral
against all prior parties. The Lender shall be deemed to have exercised
reasonable care in the preservation and custody of such of the Collateral as may
be in the Lender's possession if the Lender takes such action for that purpose
as such Pledgor shal l reasonably request in writing; provided that such
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requested action shall not, in the judgment of the Lender, impair the Lender's
prior security interest in such Collateral or its rights in or the value of such
Collateral; and provided further that such written request is received by the
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Lender in sufficient time to permit the Lender to take the
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requested action. In the absence of such written request, the Lender shall be
deemed to have exercised reasonable care in the custody and preservation of the
Collateral in its possession if the Collateral is accorded treatment
substantially equal to that which the Lender accords its own property.
7. Ownership Interests. Except as set forth on Schedule IV, (i) the Pledged
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Securities represent 100% of the capital stock or securities or other ownership
interests of each Subsidiary of the Borrower and (ii) there are no options,
warrants, convertible securities or other rights to acquire the capital stock or
securities or other ownership interests of any Subsidiary of the Borrower.
8. Records. Each Pledgor shall keep accurate and complete records with
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respect to each item and category of the Collateral and shall furnish copies of
such records to the Lender with reasonable promptness from time to time upon
request of the Lender.
9. Preservation and Protection of Security Interest. Each Pledgor shall
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preserve and protect the Lender's security interest in the Collateral and shall,
at its own cost and expense, cause such security interest in the Collateral to
be perfected and continue perfected so long as the Secured Obligations or any
portion thereof are outstanding and unpaid and so long as the Borrower may
borrow funds and the Lender has any obligation to advance funds to the Borrower
under the Loan Agreement (by means including, without limitation, the execution
and delivery of all instruments, documents and securities to the Lender with
endorsements and documents of transfer satisfactory to the Lender), and for such
purposes each Pledgor shall from time to time at the request of the Lender file
or record, or cause to be filed or recorded, such instruments, documents and
notices (including, without limitation, financing statements and continuation
statements) or deliver to the Lender such stock certificates or other
instruments as the Lender may deem necessary or advisable from time to time to
perfect and continue perfected such security interests. Each Pledgor shall do
all such other acts and things and shall execute and deliver all such other
instruments and documents (including, without limitation, further security
agreements, pledges, endorsements, assignments and notices) as the Lender may
deem necessary or advisable from time to time to perfect and preserve the
priority of such security interests in the Collateral, as a perfected security
interest in the Collateral, prior to the rights of any other secured party or
lien creditor. The Lender, and its officers, employees and authorized agents,
or any of them, are hereby irrevocably appointed the attorneys-in-fact of each
Pledgor to do, at such Pledgor's expense, all acts and things which the Lender
may deem necessary or advisable to preserve, perfect and continue perfected the
Lender's security interests in the Collateral (including, without limitation,
the signing of financing, continuation or other similar statements and notices
on behalf of each Pledgor), which appointment is irrevocable and coupled with an
interest.
10. Covenants of the Borrower. Each Pledgor covenants and agrees with the
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Lender that from and after the date of this Agreement and until the Secured
Obligations are fully satisfied and the Borrower may no longer borrow funds and
the Lender no longer has any obligation to advance funds to the Borrower under
the Loan Agreement:
10.1 Limitation on Liens on Collateral. Such Pledgor shall not create,
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permit or suffer to exist, and shall defend the Collateral against, and take
such other action as is necessary to remove, any lien on or security interest in
the Collateral (other than liens in favor of the Lender), and shall defend the
right, title and interest of the Lender in and to any of such Pledgor's right,
title
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and interest of the Lender in and to any of such Pledgor's right, title and
interest in and to the Collateral and to any proceeds thereof against the claims
and demands of all other Persons whomsoever.
10.2 Limitation on Disposition. Such Pledgor shall not sell, assign,
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exchange or otherwise transfer, or grant any options with respect to, any of the
Collateral or any interest therein, or attempt or contract to do so (other than
the pledge and security interest granted hereunder) without the prior written
consent of the Lender.
10.3 Notices. Such Pledgor shall advise the Lender promptly, in reasonable
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detail, of (i) any lien, security interest, encumbrance or claim made or
asserted against any of the Collateral, (ii) any material change in the
composition of the Collateral (including, without limitation, information
regarding the issuance or creation of Equity Rights) and (iii) the occurrence of
any other event which might have a material adverse effect on the value of the
Collateral or on the security interests created hereunder.
10.4 Additional Securities. Such Pledgor shall (i) not issue any Pledged
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Securities, Other Securities, Equity Rights or other securities in addition to
or in substitution for the Pledged Securities, except to any Borrower Entity or
as permitted under the Loan Agreement, (ii) immediately upon its acquisition
(directly or indirectly) thereof, pledge to the Lender hereunder any and all
additional shares of stock, other securities or ownership interests issued by
its Subsidiaries and (iii) shall pledge to the Lender hereunder, immediately
upon its acquisition (directly or indirectly) hereof, any and all shares of
stock, other securities or ownership interests of any entity which, after the
date of this Agreement, becomes a direct or indirect Subsidiary of such Pledgor.
10.5 Further Assurances. From time to time upon the request of the Lender,
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such Pledgor shall, and shall cause its Subsidiaries to, execute and deliver
such further documents and do such further acts and things as the Lender may
reasonably request to effectuate the provisions of this Agreement (including,
without limitation, the making of any filings pursuant to the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended).
11. The Lender's Appointment as Attorney-in-Fact.
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11.1 Each Pledgor hereby irrevocably constitutes and appoints the Lender
and any officer or agent thereof, with full power of substitution, as its true
and lawful attorney-in-fact with full irrevocable power and authority in the
place and stead of such Pledgor and in the name of such Pledgor or in its own
name, from time to time in the Lender's discretion, for the purpose of carrying
out the terms of this Agreement, to take any and all appropriate action and to
execute and deliver any and all documents and instruments which may be necessary
or desirable to accomplish the purposes of this Agreement. Without limiting the
generality of the foregoing and subject to each Pledgor's rights under Section 5
hereof, each Pledgor hereby gives the Lender and any officer or agent thereof,
as such attorney-in-fact, the power and right, on behalf of such Pledgor,
without notice to or assent by such Pledgor, to do the following:
11.1.1 to defend any suit, action or proceeding brought against such
Pledgor with respect to any Collateral;
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11.1.2 to pay or discharge taxes, liens, security interests or other
encumbrances levied or placed on or threatened against the Collateral;
11.1.3 to direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due and to become due
thereunder directly to the Lender or as the Lender shall direct;
11.1.4 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;
11.1.5 to endorse and collect any checks, drafts, notes, acceptances
or other instruments for the payment of moneys due under any Collateral;
11.1.6 to commence and prosecute any suits, actions or proceedings at
law or in equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in respect of
the Collateral;
11.1.7 to settle, compromise or adjust any suit, action or proceeding
described above and, in connection therewith, to give such discharges or
releases as the Lender may deem appropriate;
11.1.8 to participate in any recapitalization, reclassification,
reorganization, consolidation, redemption, stock split, merger or liquidation of
any issuer of the Collateral and, in connection therewith, may deposit or
surrender control of the Collateral in exchange therefor and take such other
action as deemed proper by the Lender in connection therewith; and
11.1.9 generally, to sell, transfer, pledge, vote, make any agreement
with respect to or otherwise deal with any of the Collateral as fully and
completely as though the Lender were the absolute owner thereof for all
purposes, and to do, at the Lender's option and at such Pledgor's expense, at
any time, or from time to time, all acts and things which the Lender reasonably
deems necessary to protect, preserve or realize upon the Collateral and the
Lender's security interest therein, to effect the intent of this Agreement, all
as fully and effectively as such Pledgor might do;
provided that the Lender shall be permitted to take the actions described in
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subsections 11.1.3 through 11.1.9 only upon the occurrence and during the
continuation of an Event of Default.
11.2 Any and all such amounts received by the Lender as attorney-in-fact
for each Pledgor may, in the sole discretion of the Lender, be held by the
Lender as collateral security. Each Pledgor hereby ratifies, to the extent
permitted by law, all that such attorneys shall lawfully do or cause to be done
by virtue hereof. This power of attorney is a power coupled with an interest and
shall be irrevocable until the Secured Obligations are indefeasibly paid in full
and the Loan Agreement is terminated.
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11.3 The powers conferred on the Lender hereunder are solely to protect
the Lender's interests in the Collateral and shall not impose any duty upon it
to exercise any such powers. The Lender shall be accountable only for amounts
that it actually receives as a result of the exercise of such powers, and
neither it nor any of its officers, directors, employees or agents shall be
responsible to any Pledgor for any act or failure to act, except for its own
gross negligence or willful misconduct.
11.4 Each Pledgor also authorizes the Lender, at any time and from time to
time upon the occurrence and during the continuance or existence of any Event of
Default, to execute, in connection with the sale provided for in Section 12 of
this Agreement, any endorsements, assignments or other instruments of conveyance
or transfer with respect to the Collateral.
12. Remedies on Default.
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12.1 If any Event of Default shall occur and be continuing or shall exist,
the Lender may take possession and control of all or any part of the Collateral
(including Proceeds thereof) and books and records pertaining thereto, with or
without judicial process, and, without demand or notice (and if notice is
required by law, after ten days prior written notice), may proceed to exercise
one or more of the rights and remedies accorded a secured party by the UCC and
otherwise by law or by the terms of the Loan Agreement or this Agreement. The
Lender's rights and remedies shall include, without limitation, the power to
sell, lease, assign, give options to purchase or otherwise dispose of and
deliver all or any portion of the Collateral at public or private sale or sales
at such place and time and on such terms as the Lender may see fit, and to
endorse in the name of the appropriate Pledgor any instrument representing
Collateral. All of the rights and remedies of the Lender under this Agreement
shall be cumulative and not exclusive of other rights and remedies which it
otherwise would have, whether under the Loan Agreement, this Agreement, the UCC,
the other Security Documents or otherwise. The Lender shall not be under any
obligation to marshal any assets in favor of any Pledgor or any other Person or
against or in payment of all or any part of the Secured Obligations.
12.2 Each Pledgor agrees that in any sale of any of the Collateral, the
Lender is authorized to comply with any limitation or restriction in connection
with such sale which it is advised by its counsel is appropriate (i) to avoid
violation of applicable law (including, without limitation, procedures
restricting the number of prospective bidders and purchasers, requiring that
prospective bidders and purchasers have certain qualifications and restricting
prospective bidders and purchasers to persons who shall represent and agree that
they are purchasing for their own account for investment and not with a view to
the distribution or resale of any Pledged Securities, Other Securities or Equity
Rights they purchase), or (ii) to obtain any required approval of such sale or
of a purchase of such sale by any governmental regulatory authority or official.
Each Pledgor further agrees that such compliance shall not result in any such
sale being deemed not to have been made in a commercially reasonable manner, nor
shall the Lender be liable or accountable to any Pledgor for any discount
allowed by reason of the fact that any Pledged Securities, Other Securities or
Equity Rights are sold in compliance with any such limitation or restriction.
The Lender shall be under no obligation to delay the sale of any of the
Collateral for the period of time necessary to permit any Pledgor or any
Subsidiary of any Pledgor to register securities for public sale under the
Securities Act of
-10-
1933, as amended from time to time, or under applicable state securities laws,
even if such Person would agree to do so.
12.3 If any Event of Default shall occur and be continuing or shall exist,
the Lender shall have the right, in addition to all other rights and remedies
available to it, without notice to the Borrower, to set-off against and to
appropriate and apply to the unpaid balance of the Note and all other Secured
Obligations, any obligations owing to the Borrower by the Lender and any funds
held in any manner for the account of the Borrower by the Lender, and the Lender
is hereby granted a security interest in and lien on all such debts for such
purpose. Such rights shall exist whether or not the Lender shall have made any
demand under the Loan Agreement or the Note and whether the Note and such other
obligations are matured or unmatured.
13. Application of Proceeds. Any Collateral (including Proceeds thereof) held
-----------------------
or realized upon at any time by the Lender shall be applied as follows:
13.1 first, to reimburse the Lender for expenses and fees incurred for
which the Borrower or any other Borrower Entity is obligated to pay the Lender
under and in accordance with the Loan Agreement, the Note, this Agreement and/or
any other Loan Document (including, without limitation, reasonable attorneys'
fees and other legal expenses);
13.2 second, the satisfaction of all accrued and unpaid interest on the
Secured Obligations (including any interest which, but for the provisions of the
Bankruptcy Code, would have accrued on such amounts);
13.3 third, the satisfaction of the principal amounts of the Secured
Obligations outstanding; and
13.4 fourth, the balance, if any, to the Pledgors or as otherwise required
by law.
If the proceeds of sale, collection or other realization of or upon
the Collateral granted to the Lender by the Pledgors under this Agreement are
insufficient to cover the costs and expenses of such realization and the payment
in full of the Secured Obligations, the Pledgors shall remain liable, jointly
and severally, for any deficiency. If a surplus results after lawful application
of such proceeds, the Pledgors shall be entitled to a pro rata share of any such
surplus.
14. Limitation on the Lender's Duty in Respect of Collateral. The powers
--------------------------------------------------------
conferred on the Lender under this Agreement are solely to protect the Lender's
interest in the Collateral and shall not impose any duty upon it to exercise any
such powers. The Lender shall be accountable only for amounts that it actually
receives as a result of the exercise of such powers and neither the Lender nor
any of its officers, directors, employees or agents shall be responsible to any
Pledgor for any act or failure to act, except for willful misconduct. Without
limiting the foregoing, the Lender shall be deemed to have exercised reasonable
care in the custody and preservation of the Collateral in its possession if such
Collateral is accorded treatment substantially equivalent to that which the
Lender, in its individual capacity, accords it own property consisting of the
type of Collateral involved; it being understood and agreed that the Lender
shall not have
-11-
any responsibility for taking any necessary steps (other than steps taken in
accordance with the standard of care above) to preserve the rights against any
person with respect to the Collateral. Upon the request of any Pledgor, the
Lender shall account for any money received by it in respect of any foreclosure
on or disposition of the Collateral.
15. Taxes and Charges. Each Pledgor shall jointly and severally pay and
-----------------
discharge all taxes, levies and other impositions levied on any Collateral owned
by it or in its possession (except to the extent that such taxes, levies and
other impositions shall not then be due or shall be contested in good faith by
appropriate proceedings diligently conducted; provided that such reserves and
--------
other provisions as may be required by generally accepted accounting principles
have been duly made and recorded on the appropriate Pledgor's financial
records). If any Pledgor shall fail to do so, the Lender may (but shall not be
obligated to) pay such taxes, levies or impositions for the account of such
Pledgor (without waiving or releasing any obligation or default by such Pledgor
hereunder), and the amount thereof shall be added to the Secured Obligations and
shall be payable upon demand with interest accruing thereon at the highest rate
of interest accruing on the Loans under the Loan Agreement.
16. Continuing Validity of Obligations.
----------------------------------
16.1 Continuing Validity of Obligations.
----------------------------------
16.1.1 The agreements and obligations of each Pledgor hereunder are
continuing agreements and obligations and are absolute and unconditional
irrespective of (i) the genuineness, validity or enforceability of the Note or
any other instrument or instruments now or hereafter evidencing the Secured
Obligations or any part thereof or of the Loan Agreement, this Agreement, the
Guaranty, any other Loan Document or any other agreement or agreements now or
hereafter entered into by the Lender and the Borrower and/or any other Borrower
Entity pursuant to which the Secured Obligations or any part thereof is issued,
guaranteed or secured or (ii) any other circumstance which might otherwise
constitute a legal or equitable discharge of such agreements and obligations
other than payment in full of the Secured Obligations and the termination of the
Lender's obligation to lend to the Borrower.
16.1.2 Without limitation upon the foregoing, such agreements and
obligations shall continue in full force and effect as long as the Secured
Obligations or any part thereof remains outstanding and unpaid or any obligation
of the Lender to lend to the Borrower has not been terminated (whether any Loans
are outstanding) and shall remain in full force and effect without regard to and
shall not be released, discharged or in any way affected by (i) any renewal,
refinancing or refunding of the Secured Obligations in whole or in part, (ii)
any extension of the time of payment of the Note or other instrument or
instruments now or hereafter evidencing the Secured Obligations or any part
thereof, (iii) any compromise or settlement with respect to the Secured
Obligations or any part thereof, or any forbearance or indulgence extended to
the Borrower or any other Borrower Entity, (iv) any amendment to or modification
of the terms of the Note or other instrument or instruments now or hereafter
evidencing the Secured Obligations or any part thereof or of the Loan Agreement,
the Guaranty, any other Security Document or any other agreement or agreements
now or hereafter entered into by the Lender, the Borrower or any other Borrower
Entity pursuant to which the Secured Obligations or any part thereof is issued
or secured, (v) any substitution,
-12-
exchange or release of, or failure to preserve, perfect or protect, or other
dealing in respect of, the Collateral or any other property or any security for
the payment of the Secured Obligations or any part thereof, (vi) any bankruptcy,
insolvency, arrangement, composition, assignment for the benefit of creditors or
similar proceeding commenced by or against the Borrower or any Pledgor or (vii)
any other matter or thing whatsoever whereby the agreements and obligations of
the Borrower under the Note, the Loan Agreement or any other Security Document
or of any Pledgor hereunder, under the Guaranty or any other Security Document
would or might otherwise be released or discharged other than payment in full of
the Secured Obligations and the termination of the Lender's obligation to lend
to the Borrower. Each Pledgor hereby waives notice of the acceptance of this
Agreement by the Lender.
16.1.3 To the extent that the Borrower, any other Borrower Entity or
any other guarantor or pledgor makes a payment or payments to the Lender or the
Lender receives any payment or proceeds of the Collateral, which payment or
proceeds or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required to be repaid to such Person or
a trustee, receiver or any other party under any bankruptcy law, state or
federal law, common law or equitable cause of action, then, to the extent of
such payment or proceeds, the Secured Obligations or portion thereof intended to
be satisfied and this Agreement shall be revived and continue in full force and
effect, as if such payment or proceeds had not been received by the Lender.
17. Defeasance. At such time as the Borrower may no longer borrow funds under
----------
the Loan Agreement and upon payment in full of the Secured Obligations and the
termination of all obligations of the Lender to advance funds to the Borrower
under the Loan Agreement, this Agreement shall terminate and be of no further
force and effect (except for the provisions of Sections 16 and 18 hereof which
shall survive), and in such event Lender shall, at the expense of the Pledgors
and without recourse, representation or warranty, redeliver and reassign to each
Pledgor its remaining Collateral and take all action necessary to terminate the
Lender's security interest in the Collateral. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
18. Miscellaneous.
-------------
18.1 Indemnification and Expenses. The Pledgors shall, jointly and
----------------------------
severally, indemnify and hold harmless the Lender from and against any and all
claims and losses arising out of or attributable to this Agreement, except
claims and losses arising from the Lender's breach hereof or the Lender's gross
negligence or willful misconduct. The Pledgors shall pay the Lender on demand
the amount of any out-of-pocket expenses (including, without limitation,
reasonable attorneys' fees and other legal expenses) incurred by the Lender in
connection with the enforcement of this Agreement, the Loan Agreement and/or the
Note and as otherwise provided in this Agreement, with interest accruing thereon
at the highest rate of interest accruing on the Loans under the Loan Agreement.
18.2 Specific Performance. In addition to all other rights and remedies
--------------------
granted to the Lender in this Agreement, the Loan Agreement and the Loan
Documents, the Lender shall be entitled to specific performance and injunctive
and other equitable relief, and each Pledgor hereby waives any requirement for
-13-
the securing or posting of any bond or other security in connection with the
obtaining of any such specific performance and injunctive or other equitable
relief.
18.3 No Waiver. No failure or delay on the part of the Lender in the
---------
exercise of any power, right or privilege hereunder shall impair such power,
right or privilege or be construed to be a waiver thereof, nor shall any single
or partial exercise of any such power, right or privilege hereunder preclude
other or further exercise thereof or the exercise of any other right, power or
privilege. All rights and remedies existing under this Agreement are cumulative
to, and not exclusive of, any rights or remedies otherwise available.
18.4 APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE
--------------
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS
WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS.
18.5 Notices. All notices, demands or other communications to be given or
-------
delivered hereunder shall be given in accordance with the notice provision of
the Loan Agreement, if to the Borrower, and in accordance with the notice
provision of the Guaranty if to any or all of the Pledgors (other than the
Borrower).
18.6 Amendments, Etc. Subject to Section 19, the terms of this Agreement
---------------
may be waived, altered or amended only by an instrument in writing duly executed
by each Pledgor and the Lender. Any such amendment or waiver shall be binding
upon each Pledgor and the Lender and their respective successors and assigns.
18.7 Successors and Assigns. This Agreement shall be binding upon and
----------------------
inure to the benefit of the respective successors and assigns of each of the
parties hereto; provided that the no Pledgor may assign or transfer its rights
--------
hereunder without the prior written consent of the Lender.
18.8 Counterparts; Headings. This Agreement and any amendments, waivers,
----------------------
consents or supplements may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument. Section and
subsection headings in this Agreement are included herein for convenience of
reference only and shall not constitute a part of this Agreement for any other
purpose or be given any substantive effect.
18.9 Severability. If and to the extent that any provision in this
------------
Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions of this
Agreement or the obligations of any Pledgor under such provisions, or of such
provision or obligation in any other jurisdiction, or of such provision to the
extent not invalid, illegal or unenforceable shall not in any way be affected or
impaired thereby.
18.10 Other Loan Documents. This Agreement supplements the other Loan
--------------------
Documents and nothing in this Agreement shall be deemed to limit or supersede
the rights granted to the Lender in any other
-14-
Loan Document. In the event of any conflict between this Agreement and the Loan
Agreement, the provisions of the Loan Agreement shall govern.
18.11 CONSENT TO JURISDICTION AND SERVICE OF PROCESS. ALL JUDICIAL
----------------------------------------------
PROCEEDINGS BROUGHT AGAINST ANY PLEDGOR WITH RESPECT TO THIS AGREEMENT MAY BE
BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE OF
ILLINOIS LOCATED IN THE CITY OF CHICAGO, ILLINOIS, AND BY EXECUTION AND DELIVERY
OF THIS AGREEMENT EACH PLEDGOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS
PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
COURTS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN
CONNECTION WITH THIS AGREEMENT SUBJECT, HOWEVER, TO RIGHTS OF APPEAL. EACH
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 CERTIFIED MAIL, RETURN RECEIPT REQUESTED, OR BY DELIVERING A COPY
OF SUCH PROCESS TO SUCH PLEDGOR, AT ITS ADDRESS SPECIFIED IN THE NOTICE
PROVISION OF THE LOAN AGREEMENT, IF TO THE BORROWER, OR AT ITS ADDRESS SPECIFIED
IN THE NOTICE PROVISION OF THE GUARANTY, IF TO ANY OTHER PLEDGOR, OR BY ANY
OTHER METHOD PERMITTED BY APPLICABLE LAW. NOTHING HEREIN SHALL AFFECT THE RIGHT
TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT
OF THE LENDER TO BRING PROCEEDINGS AGAINST ANY PLEDGOR IN THE COURTS OF ANY
OTHER JURISDICTION.
18.12 WAIVER OF JURY TRIAL. EACH PLEDGOR AND THE LENDER HEREBY WAIVE, TO
--------------------
THE FULL EXTENT PERMITTED BY APPLICABLE LAW, THEIR RESPECTIVE RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION IN ANY COURT BASED UPON OR ARISING OUT OF
THIS AGREEMENT. NOTWITHSTANDING ANYTHING CONTAINED IN THIS AGREEMENT TO THE
CONTRARY, NO CLAIM MAY BE MADE BY ANY PLEDGOR AGAINST THE LENDER FOR ANY LOST
PROFITS OR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES IN RESPECT OF ANY
BREACH OR WRONGFUL CONDUCT (OTHER THAN WILLFUL MISCONDUCT CONSTITUTING ACTUAL
FRAUD) IN CONNECTION WITH, ARISING OUT OF OR IN ANY WAY RELATED TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREUNDER, OR ANY ACT, OMISSION OR
EVENT OCCURRING IN CONNECTION THEREWITH. EACH PLEDGOR HEREBY WAIVES, RELEASES
AND AGREES NOT TO XXX UPON ANY SUCH CLAIM FOR ANY SUCH DAMAGES. EACH PLEDGOR AND
THE LENDER FURTHER WARRANT AND REPRESENT THAT EACH HAS REVIEWED THIS WAIVER WITH
ITS LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL
RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE,
MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
TO THE LOAN DOCUMENTS, OR TO ANY OTHER
-15-
DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS. IN THE EVENT OF LITIGATION, THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT. EACH
PLEDGOR AND THE LENDER ALSO WAIVE ANY BOND OR SURETY OR SECURITY UPON SUCH BOND
WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED OF THE LENDER.
-16-
19. Additional Pledgors. It is understood and agreed that any Subsidiary of
-------------------
the Borrower or any other Borrower Entity that is required to execute a
counterpart of this Agreement after the date hereof pursuant to subsection 6.7.2
of the Loan Agreement shall automatically become a Pledgor hereunder by
executing a counterpart hereof and delivering the same to the Lender. The
execution and delivery of such counterpart or any other instrument adding an
additional Pledgor as a party to this Agreement shall not require the consent of
any other Pledgor hereunder. The rights and obligations of each Pledgor
hereunder shall remain in full force and effect notwithstanding the addition of
any new Pledgor as a party to this Agreement.
* * * * *
-17-
IN WITNESS WHEREOF, the parties hereto have executed this Pledge
Agreement as of the day and year first above written.
ZEFER CORP., as a Pledgor
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------------
Its: EVP, General Counsel and Secretary
-------------------------------------------
ZEFER CORP. NORTHEAST, as a Pledgor
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------------
Its: EVP, General Counsel and Secretary
-------------------------------------------
ZEFER CORP. WEST LLC, as a Pledgor
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------------
Its: EVP, General Counsel and Secretary
-------------------------------------------
ZEFER CORP. MIDWEST LLC, as a Pledgor
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------------
Its: EVP, General Counsel and Secretary
-------------------------------------------
ZEFER CORP. CRM LLC, as a Pledgor
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------------
Its: EVP, General Counsel and Secretary
-------------------------------------------
GTCR CAPITAL PARTNERS, L.P., as Lender
By: GTCR Mezzanine Partners, L.P.
Its: General Partner
By: GTCR Partners VI, L.P.
Its: General Partner
By: GTCR Xxxxxx Xxxxxx, L.L.C.
Its: General Partner
By: /s/ illegible
------------------------------------------
Its: Principal
-18-
SCHEDULE I
List of Pledged Securities
--------------------------
ZEFER CORP.
-----------
Type and Number of
Issuer Certificate Date and Number Shares/Interests/Units
------ --------------------------- ----------------------
___________ ____________ ___________
ZEFER CORP. NORTHEAST
Type and Number of
Issuer Certificate Date and Number Shares/Interests/Units
------ --------------------------- ----------------------
___________ ____________ ___________
ZEFER CORP. WEST LLC
Type and Number of
Issuer Certificate Date and Number Shares/Interests/Units
------ --------------------------- ----------------------
___________ ____________ ___________
ZEFER CORP. MIDWEST LLC
Type and Number of
Issuer Certificate Date and Number Shares/Interests/Units
------ --------------------------- ----------------------
___________ ____________ ___________
ZEFER CORP. CRM LLC
Type and Number of
Issuer Certificate Date and Number Shares/Interests/Units
------ --------------------------- ----------------------
___________ ____________ ___________
SCHEDULE II
Options, Warrants or other Agreements with respect to the Pledged Securities
----------------------------------------------------------------------------
SCHEDULE III
Record Locations
----------------
ZEFER CORP.
-----------
[Address]
ZEFER CORP. NORTHEAST
---------------------
[Address]
ZEFER CORP. WEST LLC
--------------------
[Address]
ZEFER CORP. MIDWEST LLC
-----------------------
[Address]
ZEFER CORP. CRM LLC
-------------------
[Address]
SCHEDULE IV
Ownership Interests Held by Persons other than the Pledgors
-----------------------------------------------------------
Type and Number of
Issuer Certificate Date and Number Shares/Interests/Units Held By
------ --------------------------- ---------------------- -------
_________ _______________ ____________ __________
_________ _______________ ____________ __________
_________ _______________ ____________ __________
Rights, Options, Warrants or other Agreements
---------------------------------------------
