Exhibit 10.13
NONRECOURSE PLEDGE AGREEMENT
PLEDGE AGREEMENT dated as of May 14, 2002 (this "Agreement"), among the
parties listed as pledgors on the signature pages hereto (the "Pledgors"),
DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly Bankers Trust Company), a New
York banking corporation ("Deutsche Bank"), as collateral agent (in such
capacity, the "Collateral Agent") for the Lenders.
Reference is made to that certain Amended and Restated Credit Agreement
dated as of May 14, 2002 (as amended, supplemented or otherwise modified from
time to time, the "Credit Agreement"), among Xxxxxx Respiratory Care Inc. (the
"Borrower"), River Holding Corp. ("Holdings"), the lenders from time to time
party thereto (the "Lenders") and Deutsche Bank, as Administrative Agent for the
Lenders, Collateral Agent, Swingline Lender and as Issuing Bank (in such
capacity, the "Issuing Bank"). All capitalized terms used herein but not defined
herein shall have the meaning ascribed to them in the Credit Agreement.
The effectiveness of the Credit Agreement is conditioned upon, among
other things, the execution and delivery by the Pledgors of a Nonrecourse Pledge
Agreement in the form hereof to secure (a) the due and punctual payment by the
Borrower of (i) the principal of and premium, if any, and interest (including
interest accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding) on the Loans, when and as due, whether at
maturity, by acceleration, upon one or more dates set for prepayment or
otherwise, (ii) each payment required to be made by the Borrower under the
Credit Agreement in respect of any Letter of Credit, when and as due, including
payments in respect of reimbursement of disbursements, interest thereon and
obligations to provide cash collateral and (iii) all other monetary obligations,
including fees, costs, expenses and indemnities, whether primary, secondary,
direct, contingent, fixed or otherwise (including monetary obligations incurred
during the pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding), of
the Borrower to the Lenders and the Secured Parties (as defined in the Security
Agreement) under the Credit Agreement and the other Credit Documents and (b) the
due and punctual payment and performance of all monetary obligations of the
Borrower under each Interest Rate Agreement entered into with any counterparty
that was a Lender at the time such Interest Rate Agreement was entered into (all
the monetary obligations referred to in the preceding clauses (a) through (b)
being referred to collectively as the "Obligations"). Capitalized terms used
herein and not defined herein shall have meanings assigned to such terms in the
Credit Agreement.
As an owner or an Affiliate of an owner of Holdings (and indirectly the
Borrower), it is in the Pledgors' interest that the Credit Agreement become
effective.
Accordingly, in consideration of the premises and for other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the Pledgors and the Collateral Agent, on behalf of itself and
each Secured Party (and each of their respective successors or assigns), hereby
agree as follows:
Exhibit 10.13
SECTION 1. Pledge. (a) As security for the payment and performance, as the
case may be, in full of the Obligations, each Pledgor hereby grants,
hypothecates, and pledges to the Collateral Agent, its successors and
assigns, and hereby grants to the Collateral Agent, its successors and
assigns, for the ratable benefit of the Secured Parties, a security
interest in all of such Pledgor's right, title and interest in, to and
under: (i)(w) the debt securities owned by it and listed on Schedule I
hereto, (x) any debt hereafter acquired by such Pledgor and representing
all or a portion of the next $5,000,000 in aggregate principal amount of
debt of the Borrower or any of its Subsidiaries to the Pledgors incurred
after the date hereof, which debt securities each Pledgor covenants shall
be in substantially the form of the securities referred to in items 3 and 4
on Schedule I hereto, (y) any other debt issued after the Effective Date of
the Borrower or any of its Subsidiaries to such Pledgor (which debt
securities shall be in substantially the form of the securities referred to
in items 3 and 4 of Schedule I hereto) other than (1) debt of Borrower,
Holdings or any other Credit Party that is subordinate or junior to the
Obligations and in a form satisfactory to the Collateral Agent and (2)
unsecured debt of HRC Holding in excess of the $5,000,000 referred to in
clause (x) above and which matures no earlier than July 1, 2004 and has no
scheduled payments prior to maturity, and (z) any promissory notes and any
other instruments evidencing the debt securities referred to in (w), (x)
and (y); (ii) all other property that may be delivered to and held by the
Collateral Agent pursuant to the terms hereof; (iii) all payments of
principal or interest, cash, instruments and other property from time to
time received, receivable or otherwise distributed, in respect of, in
exchange for or upon the conversion of the property referred to in clauses
(i) and (ii); (iv) all rights and privileges of such Pledgor with respect
to the securities and other property referred to in clauses (i), (ii) and
(iii); and (v) all proceeds of any of the foregoing (the items referred to
in clauses (i) through (v) being collectively referred to as the
"Collateral"). Upon delivery to the Collateral Agent, (i) any promissory
notes or other securities now or hereafter included in the Collateral (the
"Pledged Securities") shall be accompanied by instruments of transfer
satisfactory to the Collateral Agent and by such other instruments and
documents as the Collateral Agent may reasonably request and (ii) all other
property comprising part of the Collateral shall be accompanied by proper
instruments of assignment duly executed by the applicable Pledgor and such
other instruments or documents as the Collateral Agent may reasonably
request. Each delivery of Pledged Securities shall be accompanied by a
schedule describing the securities theretofore and then being pledged
hereunder, which schedule shall be attached hereto as Schedule I and made a
part hereof. Each schedule so delivered shall supersede any prior schedules
so delivered.
(b) THE PLEDGORS HAVE SECURED THE OBLIGATIONS BY A PLEDGE OF THE
COLLATERAL PURSUANT TO THE TERMS AND CONDITIONS OF THIS AGREEMENT.
NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT, IN ANY OTHER
CREDIT DOCUMENT, IN APPLICABLE LAW OR OTHERWISE, RECOURSE TO THE PLEDGORS
UNDER THIS AGREEMENT, ANY OTHER CREDIT DOCUMENT OR OTHERWISE SHALL BE
LIMITED TO THE COLLATERAL, AND THE SOLE AND EXCLUSIVE REMEDY OF ANY SECURED
PARTY, UPON AN EVENT OF DEFAULT OR A BANKRUPTCY EVENT OR OTHERWISE, SHALL
BE TO EXERCISE REMEDIES HEREUNDER WITH RESPECT TO THE COLLATERAL PURSUANT
TO THIS AGREEMENT AND NO
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Exhibit 10.13
OTHER RECOURSE SHALL BE HAD UNDER THIS AGREEMENT, ANY OTHER CREDIT DOCUMENT
OR OTHERWISE TO ANY PLEDGOR OR TO ANY OF THE OTHER PROPERTIES OR ASSETS OF
ANY PLEDGOR. NEITHER THE COLLATERAL AGENT NOR ANY LENDER MAY BRING ANY
ACTION OR SUIT AGAINST ANY PLEDGOR WITH RESPECT TO THE PLEDGE UNDER THIS
AGREEMENT OF THE PLEDGED COLLATERAL OTHER THAN AN ACTION (A) AGAINST SUCH
PLEDGOR LIMITED TO ENFORCEMENT OF THE SPECIFIC OBLIGATIONS OF SUCH PLEDGOR
UNDER THIS AGREEMENT WITH RESPECT TO THE COLLATERAL OR (B) FOR DECLARATORY
OR INJUNCTIVE RELIEF TO DECLARE THE EXISTENCE OF THE COLLATERAL SECURITY
PROVIDED HEREBY OR TO PROTECT THE ABILITY TO SEEK SUCH ENFORCEMENT. THIS
SECTION 1(b) SHALL BE BINDING ON ANY SUCCESSOR OR ASSIGN OF THE COLLATERAL
AGENT AND THE LENDERS AND ANY FUTURE COLLATERAL AGENT OR LENDER.
SECTION 2. Delivery of the Collateral. Each Pledgor agrees promptly to
deliver or cause to be delivered to the Collateral Agent any and all Pledged
Securities, and any and all certificates or other instruments or documents
representing the Collateral.
SECTION 3. Representations, Warranties and Covenants. Each Pledgor hereby
represents, warrants and covenants, as to itself and the Collateral pledged by
it hereunder, to and with the Collateral Agent that:
(a) except for the security interest granted hereunder, the
Pledgor (i) is and will at all times continue to be the direct owner,
beneficially and of record, of the Pledged Securities indicated on Schedule
I, (ii) holds the same free and clear of all Liens, (iii) will make no
assignment, pledge, hypothecation or transfer of, or create or permit to
exist any security interest in or other Lien on, the Collateral, other than
pursuant hereto, and (iv) will cause any and all Pledged Securities,
whether for value paid by the Pledgor or otherwise, to be forthwith
deposited with the Collateral Agent and pledged or assigned hereunder;
(b) the Pledgor (i) has the power and authority to pledge the
Collateral in the manner hereby done or contemplated and (ii) will defend
its title or interest thereto or therein against any and all Liens (other
than the Lien created by this Agreement), however arising, of all persons
whomsoever;
(c) no consent of any other person (including stockholders or
creditors of the Pledgor) and no consent or approval of any Governmental
Authority or any securities exchange was or is necessary to the validity of
the pledge effected hereby;
(d) by virtue of the execution and delivery by the Pledgors of
this Agreement, when the Pledged Securities, notes or other documents
representing or evidencing the Pledged Securities are delivered to the
Collateral Agent in accordance with this Agreement, the Collateral Agent
will obtain a valid and perfected first lien upon and security interest in
such Pledged Securities as security for the payment and performance of the
Obligations;
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Exhibit 10.13
(e) upon delivery of the Pledged Securities to the Collateral
Agent, the pledge effected hereby is effective to vest in the Collateral
Agent, on behalf of the Secured Parties, the rights of the Collateral Agent
in the Pledged Securities as set forth herein;
(f) all information set forth herein relating to the Collateral is
accurate and complete in all material respects as of the date hereof;
(g) the pledge of the Pledged Securities pursuant to this
Agreement does not violate Regulation T, U or X of the Federal Reserve
Board or any successor thereto as of the date hereof;
(h) the Pledged Securities listed on Schedule I hereto constitute
all of the Inebtedness owed by the Borrower and its Subsidiaries to the
Pledgors and their Affiliates required to be pledged hereunder pursuant
hereto and pursuant to the Credit Agreement. All of the Indebtedness owed
by the Borrower and its Subsidiaries to the Pledgors and their Affiliates
as of the Effective Date (other than the Pledged Securities) is
subordinated to the Obligations; and
(i) No Pledgor shall consent to any amendment, supplement or other
modification of any of the terms or provisions contained in the Pledged
Securities, other than any amendment, supplement or other modification
which extends the date or reduces the amount of any required repayment or
redemption and other than any amendment, supplement or other modification
to the Senior Notes which: (a) is consummated without any condition
precedent or subsequent remaining unsatisfied or unwaived prior to the
six-month anniversary of the Effective Date in connection with a
restructuring or exchange of the Borrower's Senior Subordinated Notes which
reduces the Borrower's overall Indebtedness or interest costs, (b) converts
the Senior Notes to Capital Stock (other than Disqualified Stock), which
Capital Stock remains pledged to Collateral Agent pursuant to this
Agreement and (c) no Default, Event of Default or Bankruptcy Event has
occurred and is continuing or would arise as a result of such transactions
under the Credit Documents.
SECTION 4. Registration in Nominee Name; Denominations. The Collateral
Agent, on behalf of the Secured Parties, shall have the right (in its sole and
absolute discretion) to hold the Pledged Securities in its own name as pledgee,
the name of its nominee (as pledgee or as sub-agent) or the name of the
applicable Pledgor, endorsed or assigned in blank or in favor of the Collateral
Agent. Each Pledgor will promptly give to the Collateral Agent copies of any
notices or other communications received by it with respect to the Pledged
Securities. The Collateral Agent shall at all times have the right to exchange
the certificates representing Pledged Securities for certificates of smaller or
larger denominations for any purpose consistent with this Agreement.
SECTION 5. Voting Rights; Dividends and Interest, etc. (a) Unless and until
an Event of Default or one of the events described in Sections 7.01(g) and
(h) of the Credit Agreement (a "Bankruptcy Event") shall have occurred and
be continuing:
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Exhibit 10.13
(i) Each Pledgor shall be entitled to exercise any and
all voting and/or other consensual rights and powers inuring to an owner of
Pledged Securities or any part thereof for any purpose consistent with the
terms of this Agreement, the Credit Agreement and the other Credit
Documents; provided, however, that such Pledgor will not be entitled to
exercise any such right if the result thereof would reasonably be expected
to materially and adversely affect the rights inuring to a holder of the
Pledged Securities or the rights and remedies of any of the Secured Parties
under this Agreement or the Credit Agreement or any other Credit Document
or the ability of the Secured Parties to exercise the same; provided
further that no Pledgor shall exercise any of its rights as a holder of
"Designated Senior Debt" with respect to the Senior Subordinated Notes
without the prior written approval of the Collateral Agent; and provided
further that upon the written direction of the Collateral Agent, such
Pledgor shall exercise its rights as a holder of "Designated Senior Debt"
with respect to the Senior Subordinated Notes in accordance with such
written direction.
(ii) The Collateral Agent shall execute and deliver to
each Pledgor, or cause to be executed and delivered to each Pledgor, all
such proxies, powers of attorney and other instruments as such Pledgor may
reasonably request for the purpose of enabling such Pledgor to exercise the
voting and/or consensual rights and powers it is entitled to exercise
pursuant to subclause (i).
(b) The Collateral Agent shall have the sole and exclusive right and
authority to receive and retain any and all cash and noncash dividends,
interest, principal or other property on account of the Collateral paid or
delivered on or with respect to the Collateral. All interest, principal or
other property on account of the Collateral received by any Pledgor
contrary to the provisions of this Section 5 shall be held in trust for the
benefit of the Collateral Agent, shall be segregated from other property or
funds of such Pledgor and shall be forthwith delivered to the Collateral
Agent upon demand in the same form as so received (with any necessary
endorsement). Any and all money and other property paid over or delivered
to or received by the Collateral Agent pursuant to the provisions of this
clause (b) shall be retained by the Collateral Agent in an account to be
established by the Collateral Agent upon receipt of such money or other
property and, upon the occurrence of an Event of Default or a Bankruptcy
Event, shall be reduced to cash and applied in accordance with the
provisions of Sections 6 and 7.
(c) Upon the occurrence and during the continuance of an Event of
Default or a Bankruptcy Event, all rights of any Pledgor to exercise the
voting and consensual rights and powers it is entitled to exercise pursuant
to clause (a)(i) of this Section 5, and the obligations of the Collateral
Agent under clause (a)(ii) of this Section 5, shall cease, and all such
rights shall thereupon become vested in the Collateral Agent, which shall
have the sole and exclusive right and authority to exercise such voting and
consensual rights and powers, provided that, unless otherwise directed by
the Required Lenders, the Collateral Agent shall have the right from time
to time following and during the continuance of an Event of Default to
permit a Pledgor to exercise such rights. After all Events of Default have
been cured or waived and provided that no Bankruptcy Event exists, each
Pledgor will have the right to exercise the voting and consensual rights
and
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Exhibit 10.13
powers that it would otherwise be entitled to exercise pursuant to the
terms of clause (a)(i).
SECTION 6. Remedies upon Default. Upon the occurrence and during the
continuance of an Event of Default or a Bankruptcy Event, subject to applicable
regulatory and legal requirements, the Collateral Agent may sell the Collateral,
or any part thereof, at public or private sale or at any broker's board or on
any securities exchange, for cash, on credit or for future delivery as the
Collateral Agent shall deem appropriate. The Collateral Agent shall be
authorized at any such sale (if it deems it advisable to do so) to restrict the
prospective bidders or purchasers to persons who will represent and agree that
they are purchasing the Collateral for their own account for investment and not
with a view to the distribution or sale thereof, and upon consummation of any
such sale the Collateral Agent shall have the right to assign, transfer and
deliver to the purchaser or purchasers thereof the Collateral so sold. Each such
purchaser at any such sale shall hold the property sold absolutely free from any
claim or right on the part of any Pledgor, and, to the extent permitted by
applicable law, the Pledgors hereby waive all rights of redemption, stay,
valuation and appraisal any Pledgor now has or may at any time in the future
have under any rule of law or statute now existing or hereafter enacted.
The Collateral Agent shall give the applicable Pledgor 10 days' prior
written notice (which each Pledgor agrees is reasonable notice within the
meaning of Section 9-611 of the Uniform Commercial Code as in effect in the
State of New York or its equivalent in other jurisdictions) of the Collateral
Agent's intention to make any sale of such Pledgor's Collateral. Such notice, in
the case of a public sale, shall state the time and place for such sale and, in
the case of a sale at a broker's board or on a securities exchange, shall state
the board or exchange at which such sale is to be made and the day on which the
Collateral, or portion thereof, will first be offered for sale at such board or
exchange. Any such public sale shall be held at such time or times within
ordinary business hours and at such place or places as the Collateral Agent may
fix and state in the notice of such sale. At any such sale, the Collateral, or
portion thereof, to be sold may be sold in one lot as an entirety or in separate
parcels, as the Collateral Agent may (in its sole and absolute discretion)
determine. The Collateral Agent shall not be obligated to make any sale of any
Collateral if it shall determine not to do so, regardless of the fact that
notice of sale of such Collateral shall have been given. The Collateral Agent
may, without notice or publication, adjourn any public or private sale or cause
the same to be adjourned from time to time by announcement at the time and place
fixed for sale, and such sale may, without further notice, be made at the time
and place to which the same was so adjourned. In case any sale of all or any
part of the Collateral is made on credit or for future delivery, the Collateral
so sold may be retained by the Collateral Agent until the sale price is paid in
full by the purchaser or purchasers thereof, but the Collateral Agent shall not
incur any liability in case any such purchaser or purchasers shall fail to take
up and pay for the Collateral so sold and, in case of any such failure, such
Collateral may be sold again upon like notice. At any public (or, to the extent
permitted by applicable law, private) sale made pursuant to this Section 6, any
Secured Party may bid for or purchase, free from any right of redemption, stay
or appraisal on the part of any Pledgor (all said rights being also hereby
waived and released), the Collateral or any part thereof offered for sale and
may make payment on account thereof by using any claim then due and payable to
it from such Pledgor as a credit against the purchase price, and it may, upon
compliance with the terms of sale, hold, retain and dispose of such property
without further accountability to such Pledgor therefor. For purposes hereof,
(a) a written agreement to purchase the Collateral or any portion
6
Exhibit 10.13
thereof shall be treated as a sale thereof, (b) the Collateral Agent shall be
free to carry out such sale pursuant to such agreement and (c) such Pledgor
shall not be entitled to the return of the Collateral or any portion thereof
subject thereto, notwithstanding the fact that after the Collateral Agent shall
have entered into such an agreement all Events of Default and Bankruptcy Events
shall have been remedied and the Obligations paid in full. As an alternative to
exercising the power of sale herein conferred upon it, the Collateral Agent may
proceed by a suit or suits at law or in equity to foreclose upon the Collateral
and to sell the Collateral or any portion thereof pursuant to a judgment or
decree of a court or courts having competent jurisdiction or pursuant to a
proceeding by a court-appointed receiver. Any sale pursuant to the provisions of
this Section 6 shall be deemed to conform to the commercially reasonable
standards as provided in Section 9-610 of the Uniform Commercial Code as in
effect in the State of New York or its equivalent in other jurisdictions.
SECTION 7. Application of Proceeds of Sale. The proceeds of any sale of
Collateral pursuant to Section 6, as well as (following an Event of Default or a
Bankruptcy Event) any Collateral consisting of cash, shall be applied by the
Collateral Agent as follows:
FIRST, to the payment of all costs and expenses incurred by the
Collateral Agent in connection with such sale or otherwise in connection
with this Agreement, any other Credit Document or any of the Obligations,
including all court costs and the reasonable fees and expenses of its
agents and legal counsel, the repayment of all advances made by the
Collateral Agent hereunder or under any other Credit Document on behalf of
the Pledgors and any other costs or expenses incurred in connection with
the exercise of any right or remedy hereunder or under any other Credit
Document;
SECOND, to the payment in full of the Obligations (the amounts so
applied to be distributed among the Secured Parties pro rata in accordance
with the amounts of the Obligations owed to them on the date of any such
distribution); and
THIRD, to the Pledgors, their successors or assigns, or as a court of
competent jurisdiction may otherwise direct.
The Collateral Agent shall have absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Agreement. Upon any sale of the Collateral by the Collateral Agent (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the purchase money by the Collateral Agent or of the officer
making the sale shall be a sufficient discharge to the purchaser or purchasers
of the Collateral so sold and such purchaser or purchasers shall not be
obligated to see to the application of any part of the purchase money paid over
to the Collateral Agent or such officer or be answerable in any way for the
misapplication thereof.
SECTION 8. Reimbursement of Collateral Agent. (a) Each Pledgor agrees to
pay upon demand to the Collateral Agent the amount of any and all reasonable
expenses, including the reasonable fees, other charges and disbursements of its
counsel and of any experts or agents, that the Collateral Agent may incur in
connection with (i) the administration of this Agreement, (ii) the custody or
preservation of, or the sale of, collection from, or other realization upon, any
of
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Exhibit 10.13
the Collateral, (iii) the exercise or enforcement of any of the rights of the
Collateral Agent hereunder or (iv) the failure by such Pledgor to perform or
observe any of the provisions hereof.
(b) Each Pledgor agrees to indemnify the Collateral Agent and the
Indemnitees (as defined in Section 9.05 of the Credit Agreement) against,
and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including reasonable counsel
fees, other charges and disbursements, incurred by or asserted against any
Indemnitee arising out of, in any way connected with, or as a result of (i)
the execution or delivery of this Agreement or any other Credit Document or
any agreement or instrument contemplated hereby or thereby, the performance
by the parties hereto of their respective obligations thereunder or the
consummation of the Transactions and the other transactions contemplated
thereby or (ii) any claim, litigation, investigation or proceeding relating
to any of the foregoing, whether or not any Indemnitee is a party thereto,
provided that such indemnity shall not, as to any Indemnitee, be available
to the extent that such losses, claims, damages, liabilities or related
expenses are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or
willful misconduct of such Indemnitee.
(c) Any amounts payable as provided hereunder shall be additional
Obligations secured hereby and by the other Security Documents. The
provisions of this Section 8 shall remain operative and in full force and
effect regardless of the termination of this Agreement, the consummation of
the transactions contemplated hereby, the repayment of any of the
Obligations, the invalidity or unenforceability of any term or provision of
this Agreement or any other Credit Document or any investigation made by or
on behalf of the Collateral Agent or any other Secured Party. All amounts
due under this Section 8 shall be payable on written demand therefor and
shall bear interest at the rate specified in Section 2.06 of the Credit
Agreement.
SECTION 9. Collateral Agent Appointed Attorney-in-Fact. Each Pledgor
irrevocably makes, constitutes and appoints the Collateral Agent (and all
officers, employees or agents designated by the Collateral Agent) as such
Pledgor's true and lawful agent and attorney-in-fact, and in such capacity the
Collateral Agent shall have the right, with power of substitution for each
Pledgor and in each Pledgor's name or otherwise, for the use and benefit of the
Collateral Agent and the Secured Parties, upon the occurrence and during the
continuance of an Event of Default or a Bankruptcy Event, to ask for, demand,
xxx for, collect, receive and give acquittance for any and all moneys due or to
become due under and by virtue of any Collateral, to endorse checks, drafts,
orders and other instruments for the payment of money payable to such Pledgor
representing any interest or dividend or other distribution payable in respect
of the Collateral or any part thereof or on account thereof and to give full
discharge for the same, to settle, compromise, prosecute or defend any action,
claim or proceeding with respect thereto, and to sell, assign, endorse, pledge,
transfer and to make any agreement respecting, or otherwise deal with, the same;
provided, however, that nothing herein contained shall be construed as requiring
or obligating the Collateral Agent to make any commitment or to make any inquiry
as to the nature or sufficiency of any payment received by the Collateral Agent,
or to present or file any claim or notice, or to take any action with respect to
the Collateral or any part thereof or the moneys due or to become due in respect
thereof or any property covered thereby. The Collateral Agent and the other
Secured Parties shall be accountable only for amounts actually received as a
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Exhibit 10.13
result of the exercise of the powers granted to them herein, and neither they
nor their officers, directors, employees or agents shall be responsible to any
Pledgor for any act or failure to act hereunder, except for their own gross
negligence or willful misconduct.
SECTION 10. Waivers; Amendment. (a) No failure or delay of the Collateral
Agent in exercising any power or right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a
right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of the
Collateral Agent hereunder and of the other Secured Parties under the other
Credit Documents are cumulative and are not exclusive of any rights or
remedies that they would otherwise have. No waiver of any provisions of
this Agreement or consent to any departure by any Pledgor therefrom shall
in any event be effective unless the same shall be permitted by clause (b),
and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. No notice or demand on any
Pledgor in any case shall entitle such Pledgor to any other or further
notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to a written agreement entered into
between the Collateral Agent and the Pledgor or Pledgors with respect to
which such waiver, amendment or modification is to apply, subject to any
consent required in accordance with Section 9.08 of the Credit Agreement.
SECTION 11. Securities Act, etc. In view of the position of the Pledgors in
relation to the Pledged Securities, or because of other current or future
circumstances, a question may arise under the Securities Act of 1933, as now or
hereafter in effect, or any similar statute hereafter enacted analogous in
purpose or effect (such Act and any such similar statute as from time to time in
effect being called the "Federal Securities Law") with respect to any
disposition of the Pledged Securities permitted hereunder. Each Pledgor
understands that compliance with the Federal Securities Laws might very strictly
limit the course of conduct of the Collateral Agent if the Collateral Agent were
to attempt to dispose of all or any part of the Pledged Securities, and might
also limit the extent to which or the manner in which any subsequent transferee
of any Pledged Securities could dispose of the same. Similarly, there may be
other legal restrictions or limitations affecting the Collateral Agent in any
attempt to dispose of all or part of the Pledged Securities under applicable
Blue Sky or other state securities laws or similar laws analogous in purpose or
effect. Each Pledgor recognizes that in light of such restrictions and
limitations the Collateral Agent may, with respect to any sale of the Pledged
Securities, limit the purchasers to those who will agree, among other things, to
acquire such Pledged Securities for their own account, for investment, and not
with a view to the distribution or resale thereof. Each Pledgor acknowledges and
agrees that in light of such restrictions and limitations, the Collateral Agent,
in its sole and absolute discretion, (a) may proceed to make such a sale whether
or not a registration statement for the purpose of registering such Pledged
Securities or part thereof shall have been filed under the Federal Securities
Laws and (b) may approach and negotiate with a single potential purchaser to
effect such sale. Each Pledgor acknowledges and agrees that any such sale might
result in prices and other terms less favorable to the seller than if such sale
were a public sale without such restrictions. In the event of any such sale, the
Collateral Agent shall incur no
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Exhibit 10.13
responsibility or liability for selling all or any part of the Pledged
Securities at a price that the Collateral Agent, in its sole and absolute
discretion, may in good xxxxx xxxx commercially reasonable under the
circumstances, notwithstanding the possibility that a substantially higher price
might have been realized if the sale were deferred until after registration as
aforesaid or if more than a single purchaser were approached. The provisions of
this Section 11 will apply notwithstanding the existence of a public or private
market upon which the quotations or sales prices may exceed substantially the
price at which the Collateral Agent sells.
SECTION 12. Registration, etc. Each Pledgor agrees that, upon the
occurrence and during the continuance of an Event of Default or a Bankruptcy
Event hereunder, if for any reason the Collateral Agent desires to sell any of
the Pledged Securities of the Borrower at a public sale, it will, at any time
and from time to time, upon the written request of the Collateral Agent, use its
best efforts to take or to cause the issuer of such Pledged Securities to take
such action and prepare, distribute and/or file such documents, as are required
or advisable in the reasonable opinion of counsel for the Collateral Agent to
permit the public sale of such Pledged Securities. Each Pledgor further agrees
to indemnify, defend and hold harmless the Collateral Agent, each other Secured
Party, any underwriter and their respective officers, directors, affiliates and
controlling persons from and against all loss, liability, expenses, costs of
counsel (including, without limitation, reasonable fees and expenses to the
Collateral Agent of legal counsel), and claims (including the costs of
investigation) that they may incur insofar as such loss, liability, expense or
claim arises out of or is based upon any alleged untrue statement of a material
fact contained in any prospectus (or any amendment or supplement thereto) or in
any notification or offering circular, or arises out of or is based upon any
alleged omission to state a material fact required to be stated therein or
necessary to make the statements in any thereof not misleading, except insofar
as the same may have been caused by any untrue statement or omission based upon
information furnished in writing to such Pledgor or the issuer of such Pledged
Securities by the Collateral Agent or any other Secured Party expressly for use
therein. Each Pledgor further agrees, upon such written request referred to
above, to use its best efforts to qualify, file or register, or cause the issuer
of such Pledged Securities to qualify, file or register, any of the Pledged
Securities under the Blue Sky or other securities laws of such states as may be
requested by the Collateral Agent and keep effective, or cause to be kept
effective, all such qualifications, filings or registrations. Each Pledgor will
bear all costs and expenses of carrying out its obligations under this Section
12. Each Pledgor acknowledges that there is no adequate remedy at law for
failure by it to comply with the provisions of this Section 12 and that such
failure would not be adequately compensable in damages, and therefore agrees
that its agreements contained in this Section 12 may be specifically enforced.
SECTION 13. Security Interest Absolute. All rights of the Collateral Agent
hereunder, the grant of a security interest in the Collateral and all
obligations of the Pledgors hereunder, shall be absolute and unconditional
irrespective of (a) any lack of validity or enforceability of the Credit
Agreement, any other Credit Document, any agreement with respect to any of the
Obligations or any other agreement or instrument relating to any of the
foregoing, (b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations, or any other amendment or waiver
of or any consent to any departure from the Credit Agreement, any other Credit
Document or any other agreement or instrument relating to any of the foregoing,
(c) any exchange, release or nonperfection of any other collateral, or any
release or amendment or waiver of or consent to or departure from any guaranty,
for all or any of the
10
Exhibit 10.13
Obligations or (d) any other circumstance that might otherwise constitute a
defense available to, or a discharge of, the Pledgors in respect of the
Obligations or in respect of this Agreement (other than the indefeasible payment
in full of all the Obligations).
SECTION 14. Termination or Release. (a) This Agreement and the security
interests granted hereby shall terminate when all the Obligations (other
than inchoate indemnification and expense reimbursement obligations) have
been indefeasibly paid in full and the Lenders have no further commitment
to lend under the Credit Agreement, the L/C Exposure has been reduced to
zero and the Issuing Bank has no further obligation to issue Letters of
Credit under the Credit Agreement.
(b) In connection with any termination or release pursuant to clause
(a), the Collateral Agent shall execute and deliver to the applicable
Pledgor, at such Pledgor's expense, all documents that such Pledgor shall
reasonably request to evidence such termination or release. Any execution
and delivery of documents pursuant to this Section 14 shall be without
recourse to or warranty by the Collateral Agent.
SECTION 15. Notices. All communications and notices hereunder shall be in
writing and given as provided in Section 9.01 of the Credit Agreement. All
communications and notices hereunder to a Pledgor shall be given to it at the
address for notices set forth under its signature hereto.
SECTION 16. Further Assurances. Each Pledgor agrees that from time to time,
at its own expense, such Pledgor will promptly execute and deliver all further
instruments and documents, and take all further action, that may be necessary or
desirable, or that the Collateral Agent may request, in order to perfect and
protect any security interest granted or purported to be granted hereby or to
enable the Secured Parties to exercise and enforce its rights and remedies
hereunder with respect to any Collateral. Without limiting the generality of the
foregoing, each Pledgor will: (i) execute and file such financing or
continuation statements, or amendments thereto, and such other instruments or
notices, as may be necessary or desirable, or as the Collateral Agent may
request, in order to perfect and preserve the security interests granted or
purported to be granted hereby and (ii) at the Collateral Agent's request,
appear in and defend any action or proceeding that may affect such Pledgor's
title to or the Secured Parties' security interest in all or any part of the
Collateral. Each Pledgor hereby authorizes the Collateral Agent to file one or
more financing or continuation statements, and amendments thereto, relative to
all or any part of the Collateral without the signature of such Pledgor. Each
Pledgor agrees that a carbon, photographic or other reproduction of this
Agreement or of a financing statement signed by such Pledgor shall be sufficient
as a financing statement and may be filed as a financing statement in any and
all jurisdictions.
SECTION 17. Binding Effect; Several Agreement; Assignments. Whenever in
this Agreement any of the parties hereto is referred to, such reference shall be
deemed to include the successors and assigns of such party; and all covenants,
promises and agreements by or on behalf of the Pledgors that are contained in
this Agreement shall bind and inure to the benefit of its successors and
assigns. This Agreement shall inure to the benefit of the Pledgors, the
Collateral Agent and the other Secured Parties, and their respective successors
and assigns, except that no Pledgor may assign its rights hereunder or any
interest herein or in the Collateral (and any such
11
Exhibit 10.13
attempted assignment shall be void), except as expressly contemplated by this
Agreement or the other Credit Documents.
SECTION 18. Survival of Agreement, Severability. All covenants, agreements,
representations and warranties made by the Pledgors herein and in the
certificates or other instruments prepared or delivered in connection with
or pursuant to this Agreement or any other Credit Document shall be
considered to have been relied upon by the Collateral Agent and the other
Secured Parties and shall survive the making by the Lenders of the Loans,
the issuance of the Letters of Credit by the Issuing Bank and the execution
and delivery to the Lenders of the Notes evidencing such Loans, regardless
of any investigation made by the Secured Parties or on their behalf, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any other fee or amount payable under this
Agreement or any other Credit Document is outstanding and unpaid or the L/C
Exposure does not equal zero and as long as the Commitments and the L/C
Commitments have not been terminated.
(a) In the event any one or more of the provisions contained in this
Agreement should be held invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby (it
being understood that the invalidity of a particular provision in a
particular jurisdiction shall not in and of itself affect the validity of
such provision in any other jurisdiction). The parties shall endeavor in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as
close as possible to that of the invalid, illegal or unenforceable
provisions.
SECTION 19. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.
SECTION 20. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute a single contract, and shall become effective
as provided in Section 17. Delivery of an executed counterpart of a signature
page to this Agreement by facsimile transmission shall be as effective as
delivery of a manually executed counterpart of this Agreement.
SECTION 21. Rules of Interpretation. The rules of interpretation specified
in Section 1.02 of the Credit Agreement shall be applicable to this Agreement.
Section headings used herein are for convenience of reference only, are not part
of this Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting this Agreement.
SECTION 22. Jurisdiction; Consent to Service of Process. (a) Each Pledgor
hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and
any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement or the other Credit Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby
12
Exhibit 10.13
irrevocably and unconditionally agrees that, to the extent permitted by
applicable law, all claims in respect of any such action or proceeding may
be heard and determined in such New York State court or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees
that a final judgment in any such action or proceeding shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment or in
any other manner provided by law. Nothing in this Agreement shall affect
any right that the Collateral Agent or any other Secured Party may
otherwise have to bring any action or proceeding relating to this Agreement
or the other Credit Documents against any Pledgor or its properties in the
courts of any jurisdiction.
(b) Each Pledgor hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or the other Credit
Documents in any New York State or Federal court. Each of the parties
hereto hereby irrevocably waives, to the fullest extent permitted by law,
the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
(c) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 15. Nothing in this
Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
SECTION 23. Waiver Of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 24. Additional Pledgors. Each person that becomes holder of debt
securities required to be pledged pursuant to Section 1(a) hereof is required to
enter in this Agreement as a Pledgor upon the holder of such debt securities if
such Subsidiary owns or possesses property of a type that would be considered
Collateral hereunder. Upon execution and delivery by the Collateral Agent and a
holder of such debt securities of an instrument in the form of Annex 1, such
holder shall become a Pledgor hereunder with the same force and effect as if
originally named as a Pledgor herein. The execution and delivery of such
instrument shall not require the consent of any 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.
13
Exhibit 10.13
SECTION 25. Certain Other Rights. (a) Each Pledgor agrees that its
obligations hereunder are irrevocable, absolute, independent and
unconditional and shall not be affected by any circumstance which
constitutes a legal or equitable discharge of a guarantor or surety other
than payment in full of the Obligations. In furtherance of the foregoing
and without limiting the generality thereof, each Pledgor agrees as
follows: (i) the Collateral Agent or any Lender may from time to time,
without notice or demand and without affecting the validity or
enforceability of this Agreement or giving rise to any limitation,
impairment or discharge of such Pledgor's liability hereunder, (A) renew,
extend, accelerate or otherwise change the time, place, manner or terms of
payment of the Obligations, (B) settle, compromise, release or discharge,
or accept or refuse any offer of performance with respect to, or
substitutions for, the Obligations or any agreement relating thereto and/or
subordinate the payment of the same to the payment of any other
obligations, (C) request and accept guaranties of the Obligations and take
and hold other security for the payment of the Obligations, (D) release,
exchange, compromise, subordinate or modify, with or without consideration,
any other security for payment of the Obligations, any guaranties of the
Obligations, or any other obligation of any Person with respect to the
Obligations, (E) enforce and apply any other security now or hereafter held
by or for the benefit of the Collateral Agent or any Lender in respect of
the Obligations and direct the order or manner of sale thereof, or exercise
any other right or remedy that the Collateral Agent or the Lenders, or any
of them, may have against any such security, as the Collateral Agent in its
discretion may determine consistent with the Credit Agreement and any
applicable security agreement, including foreclosure on any such security
pursuant to one or more judicial or nonjudicial sales, whether or not every
aspect of any such sale is commercially reasonable, and (F) exercise any
other rights available to the Collateral Agent or the Lenders or any of
them, under the Credit Documents, at law or in equity; and (ii) this
Agreement and the obligations of such Pledgor hereunder shall be valid and
enforceable and shall not be subject to any limitation, impairment or
discharge for any reason (other than payment in full of the Obligations),
including without limitation the occurrence of any of the following,
whether or not such Pledgor shall have had notice or knowledge of any of
them: (A) any failure to assert or enforce or agreement not to assert or
enforce, or the stay or enjoining, by order of court, by operation of law
or otherwise, of the exercise or enforcement of, any claim or demand or any
right, power or remedy with respect to the Obligations or any agreement
relating thereto, or with respect to any guaranty of or other security for
the payment of the Obligations, (B) any waiver, amendment or modification
of, or any consent to departure from, any of the terms or provisions
(including without limitation provisions relating to events of default) of
the Credit Agreement, any of the other Credit Documents or any agreement or
instrument executed pursuant thereto, or of any guaranty or other security
for the Obligations, (C) the Obligations, or any agreement relating
thereto, at any time being found to be illegal, invalid or unenforceable in
any respect, (D) the application of payments received from any source to
the payment of indebtedness other than the Obligations, even though the
Collateral Agent or the Lenders or any of them, might have elected to apply
such payment to any part or all of the Obligations, (E) any failure to
perfect or continue perfection of a security interest in any other
collateral which secures any of the Obligations, (F) any defenses, set-offs
or counterclaims which the Borrower or any Guarantor may allege or assert
against the
14
Exhibit 10.13
Collateral Agent or any in respect of the Obligations, including but not
limited to failure of consideration, breach of warranty, payment, statute
of frauds, statute of limitations, accord and satisfaction and usury, and
(G) any other act or thing or omission, or delay to do any other act or
thing, which may or might in any manner or to any extent vary the risk of
such Pledgor as an obligor in respect of the Obligations.
(b) Each Pledgor hereby waives, for the benefit of the Lenders and the
Collateral Agent: (i) any right to require the Collateral Agent or the
Lenders, as a condition of payment or performance by such Pledgor, to (A)
proceed against the Borrower, any guarantor of the Obligations, any other
Pledgor or any other Person, (B) proceed against or exhaust any other
security held from the Borrower, any guarantor of the Obligations or any
other Person, (C) proceed against or have resort to any balance of any
deposit account or credit on the books of the Collateral Agent any Lender
in favor of the Borrower or any other Person, or (D) pursue any other
remedy in the power of the Collateral Agent or any Lender whatsoever; (ii)
any defense arising by reason of the incapacity, lack of authority or any
disability or other defense of the Borrower including, without limitation,
any defense based on or arising out of the lack of validity or the
unenforceability of the Obligations or any agreement or instrument relating
thereto or by reason of the cessation of the liability of the Borrower from
any cause other than payment in full of the Obligations; (iii) any defense
based upon any statute or rule of law which provides that the obligation of
a surety must be neither larger in amount nor in other respects more
burdensome than that of the principal; (iv) any defense based upon the
Collateral Agent's or any Lender's errors or omissions in the
administration of the Obligations, except behavior which amounts to bad
faith; (v) (A) any principles or provisions of law, statutory or otherwise,
which are or might be in conflict with the terms of this Agreement and any
legal or equitable discharge of such Pledgor's obligations hereunder, (B)
the benefit of any statute of limitations affecting such Pledgor's
liability hereunder or the enforcement hereof, (C) any rights to set-offs,
recoupments and counterclaims, and (D) promptness, diligence and any
requirement that the Collateral Agent or any Lender protect, secure,
perfect or insure any other security interest or lien or any property
subject thereto; (vi) notices, demands, presentments, protests, notices of
protest, notices of dishonor and notices of any action or inaction, notices
of default under the Credit Agreement or any agreement or instrument
related thereto, notices of any renewal, extension or modification of the
Obligations or any agreement related thereto, notices of any extension of
credit to the Borrower and notices of any of the matters referred to in
Section 25(a) and any right to consent to any thereof; and (vii) to the
fullest extent permitted by law, any defenses or benefits that may be
derived from or afforded by law which limit the liability of or exonerate
guarantors or sureties, or which may conflict with the terms of this
Agreement.
(c) As used in this Section 25(c), any reference to "the principal"
includes the Borrower, and any reference to "the creditor" includes the
Collateral Agent and each Lender. In accordance with Section 2856 of the
California Civil Code (a) each Pledgor waives any and all rights and
defenses available to the Pledgor by reason of Sections 2787 to 2855,
inclusive, 2899 and 3433 of the California Civil Code, including without
limitation any and all rights or defenses the Pledgor or any guarantor of
the Obligations may have because the Obligations are secured by real
property. This means, among other
15
Exhibit 10.13
things: (1) the creditor may collect from each Pledgor without first
foreclosing on any real or personal property collateral pledged by the
principal; and (2) if the creditor forecloses on any real property
collateral pledged by the principal: (A) the amount of the Obligations may
be reduced only by the price for which the collateral is sold at the
foreclosure sale, even if the collateral is worth more than the sale price
and (B) the creditor may collect from each Pledgor even if the creditor, by
foreclosing on the real property collateral, has destroyed any right such
Pledgor may have to collect from the principal. This is an unconditional
and irrevocable waiver of any right and defenses any Pledgor may have
because the Obligations are secured by real property. These rights and
defenses include, but are not limited to, any rights and defenses based
upon Section 580a, 580b, 580d, or 726 of the California Code of Civil
Procedure. Each Pledgor also waives all rights and defenses arising out of
an election of remedies by the creditor, even though that election of
remedies, such as a nonjudicial foreclosure with respect to security for
any of the Obligations, has destroyed such Pledgor's rights of subrogation
and reimbursement against the principal by the operation of Section 580d of
the Code of Civil Procedure or otherwise; and even though that election of
remedies by the creditor, such as nonjudicial foreclosure with respect to
security for an obligation of any guarantor of any of the Obligations, has
destroyed such Pledgor's rights of contribution against such guarantor. No
other provision of this Agreement shall be construed as limiting the
generality of any of the covenants and waivers set forth in this Section
25(c). As provided in Section 19, this Agreement shall be governed by, and
shall be construed and enforced in accordance with, the internal laws of
the State of New York, without regard to conflicts of laws principles. This
Section 25(c) is included solely out of an abundance of caution, and shall
not be construed to mean that any of the above-referenced provisions of
California law are in any way applicable to this Agreement or to any of the
Obligations.
(d) Until the Obligations shall have been paid in full, each Pledgor
shall withhold exercise of (i) any claim, right or remedy, direct or
indirect, that such Pledgor now has or may hereafter have against the
Borrower or any of its assets in connection with this Agreement or the
performance by such Pledgor of its obligations hereunder, in each case
whether such claim, right or remedy arises in equity, under contract, by
statute, under common law or otherwise and including without limitation (A)
any right of subrogation, reimbursement or indemnification that such
Pledgor now has or may hereafter have against the Borrower, Holdings or any
of their respective Subsidiaries, (B) any right to enforce, or to
participate in, any claim, right or remedy that the Collateral Agent or any
Lender now has or may hereafter have against the Borrower or any Guarantor,
and (C) any benefit of, and any right to participate in, any other
collateral or security now or hereafter held by the Collateral Agent or any
Lender, and (ii) any right of contribution such Pledgor may have against
any guarantor of any of the Obligations. Each Pledgor further agrees that,
to the extent the waiver of its rights of subrogation, reimbursement,
indemnification and contribution as set forth herein is found by a court of
competent jurisdiction to be void or voidable for any reason, any rights of
subrogation, reimbursement or indemnification such Pledgor may have against
the Borrower or against any other collateral or security, and any rights of
contribution such Pledgor may have against any such guarantor, shall be
junior and subordinate to any rights the Collateral Agent or the Lenders
may have against the Borrower, to all right, title and
16
Exhibit 10.13
interest the Collateral Agent or the Lenders may have in any such other
collateral or security, and to any right the Collateral Agent or the
Lenders may have against any such guarantor.
(e) The Pledgors acknowledge and agree that they shall have the sole
responsibility for obtaining from the Borrower such information concerning
the Borrower's financial conditions or business operations as the Pledgors
may require, and that the Collateral Agent has no duty at any time to
disclose to the Pledgor any information relating to the business operations
or financial conditions of the Borrower.
SECTION 26.
(a) So long as no Default or Event of Default under the Credit
Agreement has occurred and is continuing (or with the consent of the
Collateral Agent if a Default or Event of Default has occurred and is
continuing), any Pledgor may transfer any Pledged Securities to another
party that is (1) a shareholder of the Borrower or Holdings or (2) an
Affiliate thereof; provided that prior to or concurrently therewith, the
transferee becomes a party to this Agreement, the transferred Pledged
Securities are immediately pledged and delivered to the Collateral Agent in
accordance with this Agreement and the transferred Pledged Securities and
the transferee will immediately become subject to all of the terms hereof.
(b) Any Pledgor may convert or exchange Pledged Securities for Capital
Stock of the Borrower (other than Disqualified Stock) so long as (i) the
conversion or exchange is consummated without any condition precedent or
subsequent remaining unsatisfied or unwaived prior to the six-month
anniversary of the Effective Date in connection with a restructuring or
exchange of the Borrower's Senior Subordinated Notes which reduces the
Borrower's overall Indebtedness or interest costs, (ii) the Capital Stock
is immediately pledged to the Collateral Agent in accordance with this
Agreement and (iii) no Default, Event of Default or Bankruptcy Event has
occurred and is continuing or would arise as a result of such transactions
under the Credit Documents.
(c) In connection with a transfer, conversion or exchange permitted
under this Section 26, the Collateral Agent agrees to deliver the
instrument evidencing the transferred Pledged Securities to the issuer
thereof against delivery to the Collateral Agent of a replacement security
registered to the transferee and duly endorsed to the Collateral Agent. For
the avoidance of doubt, nothing in this Section 26 shall require the
Collateral Agent to deliver the proceeds of any Collateral.
[remainder of page intentionally left blank]
17
Exhibit 10.13
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first above written.
DEUTSCHE BANK TRUST COMPANY
AMERICAS, as Collateral Agent,
by
________________________________
Name:
Title:
Pledgors
FS EQUITY PARTNERS IV, L.P.
By: FS Capital Partners LLC,
Its: General Partner
by
________________________________
Name:
Title:
Notice address:
00000 Xxxxx Xxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxx Xxxxx
Telecopy: (000) 000-0000
S-1
Exhibit 10.13
Schedule I
to the Nonrecourse
Pledge Agreement
PLEDGED DEBT SECURITIES
1. HRC Holding Inc. Promissory Note, due August 1, 2006, issued by HRC Holding
Inc. to FS Equity Partners IV, L.P., in the principal amount of $759,128.
2. HRC Holding Inc. Promissory Note, due August 1, 2006, issued by HRC Holding
Inc. to FS Equity Partners IV, L.P., in the principal amount of $1,505,113.
3. Unsecured Senior Promissory Note Due 2004, due December 31, 2004, issued by
HRC Holding Inc. to FS Equity Partners IV, L.P., in the principal amount of
$8,000,000.
4. Unsecured Senior Promissory Note Due 2004, due December 31, 2004, issued by
Xxxxxx Respiratory Care Inc. to FS Equity Partners IV, L.P., in the
principal amount of $12,000,000.
I-1
Exhibit 10.13
Annex 1 to the
Pledge Agreement
SUPPLEMENT NO. ___________ dated as of _________, to the PLEDGE AGREEMENT
dated as of May 14, 2002, among the parties listed as pledgors on the signature
pages thereto (the "Pledgors"), DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly
Bankers Trust Company), a New York banking corporation ("Deutsche Bank"), as
collateral agent (in such capacity, the "Collateral Agent") for the Lenders.
A. Reference is made to that certain Amended and Restated Credit Agreement
dated as of May __, 2002 (as amended, supplemented or otherwise modified from
time to time, the "Credit Agreement"), among Xxxxxx Respiratory Care Inc. (the
"Borrower"), River Holding Corp. ("Holdings"), the lenders from time to time
party thereto (the "Lenders") and Deutsche Bank, as Administrative Agent for the
Lenders, Collateral Agent, Swingline Lender and as Issuing Bank (in such
capacity, the "Issuing Bank").
B. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement.
C. The Pledgors have entered into the Pledge Agreement in order to induce
the Lenders to make Loans and the Issuing Bank to issue Letters of Credit.
Pursuant to the Credit Agreement, each person that becomes a holder of debt
securities required to be pledged pursuant to section 1(a) of the Pledge
Agreement is required to enter into the Pledge Agreement as a Pledgor upon
becoming the holder of such debt securities. Section 24 of the Pledge Agreement
provides that such Subsidiaries may become Pledgors under the Pledge Agreement
by execution and delivery of an instrument in the form of this Supplement. The
undersigned Person (the "New Pledgor") is executing this Supplement in
accordance with the requirements of the Credit Agreement to become a Pledgor
under the Pledge Agreement in order to induce the Lenders to make additional
Loans and the Issuing Bank to issue additional Letters of Credit and as
consideration for Loans previously made and Letters of Credit previously issued.
Accordingly, the Collateral Agent and the New Pledgor agree as follows:
SECTION 1. In accordance with Section 24 of the Pledge Agreement, the New
Pledgor by its signature below becomes a Pledgor under the Pledge Agreement with
the same force and effect as if originally named therein as a Pledgor and the
New Pledgor hereby agrees (a) to all the terms and provisions of the Pledge
Agreement applicable to it as a Pledgor thereunder and (b) represents and
warrants that the representations and warranties made by it as a Pledgor
thereunder are true and correct on and as of the date hereof. In furtherance of
the foregoing, the New Pledgor, as security for the payment and performance in
full of the Obligations (as defined in the Pledge Agreement), does hereby create
and grant to the Collateral Agent, its successors and assigns, for the benefit
of the Secured Parties (as defined in the Security Agreement), their successors
and assigns, a security interest in and lien on all of the New Pledgor's right,
title and interest in and to the Collateral (as defined in the Pledge Agreement)
of the New Pledgor. Each reference to a "Pledgor" in the Pledge Agreement shall
be deemed to include the New Pledgor. The Pledge Agreement is hereby
incorporated herein by reference.
Annex 1-1
Exhibit 10.13
SECTION 2. This Supplement may be executed in counterparts, each of which
shall constitute an original, but all of which when taken together shall
constitute a single contract. This Supplement shall become effective when the
Collateral Agent shall have received counterparts of this Supplement that, when
taken together, bear the signatures of the New Pledgor and the Collateral Agent.
Delivery of an executed signature page to this Supplement by facsimile
transmission shall be as effective as delivery of a manually signed counterpart
of this Supplement.
SECTION 3. The New Pledgor hereby represents and warrants that set forth on
Schedule I attached hereto is a true and correct schedule of all its Pledged
Securities.
SECTION 4. Except as expressly supplemented hereby, the Pledge Agreement
shall remain in full force and effect.
SECTION 5. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD FOR PRINCIPLES
OF CONFLICTS OF LAWS.
SECTION 6. In case any one or more of the provisions contained in this
Supplement should be held invalid, illegal or unenforceable in any respect,
neither party hereto shall be required to comply with such provision for so long
as such provision is held to be invalid, illegal or unenforceable, but the
validity, legality and enforceability of the remaining provisions contained
herein and in the Pledge Agreement shall not in any way be affected or impaired.
The parties hereto shall endeavor in good-faith negotiations to replace the
invalid, illegal or unenforceable provisions with valid provisions the economic
effect of which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.
SECTION 7. All communications and notices hereunder shall be in writing and
given as provided in Section 15 of the Pledge Agreement. All communications and
notices hereunder to the New Pledgor shall be given to it at the address set
forth under its signature hereto.
SECTION 8. The New Pledgor agrees to reimburse the Collateral Agent for its
reasonable out-of-pocket expenses in connection with this Supplement, including
the reasonable fees, other charges and disbursements of counsel for the
Collateral Agent.
Annex 1-2
Exhibit 10.13
IN WITNESS WHEREOF, the New Pledgor and the Collateral Agent have duly
executed this Supplement to the Pledge Agreement as of the day and year first
above written.
[Name of New Pledgor],
by
--------------------------------
Name:
Title:
Address:
DEUTSCHE BANK TRUST COMPANY
AMERICAS, as Collateral Agent,
by
--------------------------------
Name:
Title:
Annex 1-3
Exhibit 10.13
Schedule I to
Supplement No.
to the Pledge Agreement
Pledged Securities of the New Pledgor
DEBT SECURITIES
Issuer Principal Amount Date of Note Maturity Date
-------------------- -------------------- ------------------ -------------------
Annex 1-4