SUBSIDIARY PLEDGE AGREEMENT
This SUBSIDIARY PLEDGE AGREEMENT (this "Agreement") is dated
as of April 1, 1999 and entered into by and between all Subsidiaries of the
Company that are signatories hereto (each as a "Pledgor" and collectively all
"Pledgors") and Credit Suisse First Boston as Collateral Agent for and
representative of (in such capacity herein called "Secured Party"), the
financial institutions ("Lenders") and agents ("Agents") party to the Credit
Agreement referred to below.
PRELIMINARY STATEMENTS
A. Each Pledgor is the legal and beneficial owner of the
shares of stock (the "Pledged Shares") described in Part A of Schedule I annexed
hereto and issued by the corporations named therein.
B. Secured Party, Agents and Lenders have entered into a
Credit Agreement dated as of April 1, 1999 (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement," the terms defined
therein and not otherwise defined herein being used herein as therein defined)
with Express Scripts, Inc., a Delaware corporation ("Company"), pursuant to
which Lenders have made certain commitments, subject to the terms and conditions
set forth in the Credit Agreement, to extend certain credit facilities to
Company.
C. Pledgor has executed and delivered that certain Subsidiary
Guaranty dated as of April 1, 1999 (as amended, supplemented or otherwise
modified from time to time, the "Guaranty") in favor of Secured Party for the
benefit of Lenders pursuant to which Pledgor has guarantied the prompt payment
and performance when due of all obligations of Company under the Credit
Agreement.
D. It is a condition precedent to the initial extensions of
credit by Lenders under the Credit Agreement that Pledgor shall have granted the
security interests and undertaken the obligations contemplated by this
Agreement.
NOW, THEREFORE, in consideration of the premises and in order
to induce Lenders to make Loans and other extensions of credit under the Credit
Agreement, and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Pledgor hereby agrees with Secured
Party as follows:
SECTION 1. Pledge of Security. Pledgor hereby pledges and assigns to Secured
Party, and hereby grants to Secured Party a security interest in, all of
Pledgor's right, title and interest in and to the following (the "Pledged
Collateral"):
(a) the Pledged Shares and the certificates representing the Pledged Shares and
any interest of Pledgor in the entries on the books of any financial
intermediary pertaining to the Pledged Shares, and all dividends, cash,
warrants, rights, instruments and other property or proceeds from time to time
received, receivable or otherwise distributed in respect of or in exchange for
any or all of the Pledged Shares;
(b) all additional shares of, and all securities convertible into and warrants,
options and other rights to purchase or otherwise acquire, stock of any issuer
of the Pledged Shares from time to time acquired by Pledgor in any manner (which
shares shall be deemed to be part of the Pledged Shares), the certificates or
other instruments representing such additional shares, securities, warrants,
options or other rights and any interest of Pledgor in the entries on the books
of any financial intermediary pertaining to such additional shares, and all
dividends, cash, warrants, rights, instruments and other property or proceeds
from time to time received, receivable or otherwise distributed in respect of or
in exchange for any or all of such additional shares, securities, warrants,
options or other rights;
(c) all shares of, and all securities convertible into and warrants, options and
other rights to purchase or otherwise acquire, stock of any Person that, after
the date of this Agreement, becomes, as a result of any occurrence, a direct
Subsidiary of Pledgor (which shares shall be deemed to be part of the Pledged
Shares), the certificates or other instruments representing such shares,
securities, warrants, options or other rights and any interest of Pledgor in the
entries on the books of any financial intermediary pertaining to such shares,
and all dividends, cash, warrants, rights, instruments and other property or
proceeds from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of such shares, securities, warrants,
options or other rights;
(d) to the extent not covered by clauses (a) through (d) above, all proceeds of
any or all of the foregoing Pledged Collateral. For purposes of this Agreement,
the term "proceeds" includes whatever is receivable or received when Pledged
Collateral or proceeds are sold, exchanged, collected or otherwise disposed of,
whether such disposition is voluntary or involuntary, and includes proceeds of
any indemnity or guaranty payable to Pledgor or Secured Party from time to time
with respect to any of the Pledged Collateral.
SECTION 2. Security for Obligations. This Agreement secures, and the Pledged
Collateral is collateral security for, the prompt payment or performance in full
when due, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise (including the payment of amounts that would
become due but for the operation of the automatic stay under Section 362(a) of
the Bankruptcy Code, 11 U.S.C. ss.362(a)), of all obligations and liabilities of
every nature of Pledgor now or hereafter existing under or arising out of or in
connection with the Guaranty and all extensions or renewals thereof, whether for
principal, interest (including interest that, but for the filing of a petition
in bankruptcy with respect to Company, would accrue on such obligations, whether
or not a claim is allowed against Company for such interest in the related
bankruptcy proceeding), reimbursement of amounts drawn under Letters of Credit,
fees, expenses, indemnities or otherwise, whether voluntary or involuntary,
direct or indirect, absolute or contingent, liquidated or unliquidated, whether
or not jointly owed with others, and whether or not from time to time decreased
or extinguished and later increased, created or incurred, and all or any portion
of such obligations or liabilities that are paid, to the extent all or any part
of such payment is avoided or recovered directly or indirectly from Secured
Party or any Lender as a preference, fraudulent transfer or otherwise, and all
obligations of every nature of Pledgor now or hereafter existing under this
Agreement (all such obligations of Pledgor being the "Secured Obligations").
SECTION 3. Delivery of Pledged Collateral. All certificates or instruments
representing or evidencing the Pledged Collateral shall be delivered to and held
by or on behalf of Secured Party pursuant hereto and shall be in suitable form
for transfer by delivery or, as applicable, shall be accompanied by Pledgor's
endorsement, where necessary, or duly executed instruments of transfer or
assignment in blank, all in form and substance satisfactory to Secured Party.
Upon the occurrence and during the continuation of an Event of Default (as
defined in the Credit Agreement), Secured Party shall have the right to transfer
to or to register in the name of Secured Party or any of its nominees any or all
of the Pledged Collateral, subject only to the revocable rights specified in
Section 7(a); provided that, except in the case of a bankruptcy default or an
acceleration of the Loan, no such transfer or registration shall be made without
notice to Pledgor. In addition, Secured Party shall have the right at any time
to exchange certificates or instruments representing or evidencing Pledged
Collateral for certificates or instruments of smaller or larger denominations.
SECTION 4. Representations and Warranties. Pledgor represents and warrants
as follows:
(a) Due Authorization, etc. of Pledged Collateral. All of the Pledged
Shares have been duly authorized and validly issued and are fully paid and
non-assessable.
(b) Description of Pledged Collateral. The Pledged Shares constitute all of the
issued and outstanding shares of stock of each issuer thereof organized under
the laws of a state of the United States (each a "U.S. Issuer") and 65% of the
issued and outstanding shares of stock of each other issuer thereof (each a
"Non-U.S. Issuer"), and there are no outstanding warrants, options or other
rights to purchase, or other agreements outstanding with respect to, or property
that is now or hereafter convertible into, or that requires the issuance or sale
of, any Pledged Shares.
(c) Ownership of Pledged Collateral. Pledgor is the legal, record and beneficial
owner of the Pledged Collateral free and clear of any Lien except for the
security interest created by this Agreement.
SECTION 5. Transfers and Other Liens; Additional Pledged Collateral; etc.
Pledgor shall:
(a) not, except as expressly permitted by the Credit Agreement, (i) sell, assign
(by operation of law or otherwise) or otherwise dispose of, or grant any option
with respect to, any of the Pledged Collateral, (ii) create or suffer to exist
any Lien upon or with respect to any of the Pledged Collateral, except for the
security interest under this Agreement, or (iii) permit any issuer of Pledged
Shares to merge or consolidate unless all the outstanding capital stock of the
surviving or resulting corporation is, upon such merger or consolidation,
pledged hereunder and no cash, securities or other property is distributed in
respect of the outstanding shares of any other constituent corporation; provided
that in the event Pledgor makes an Asset Sale permitted by the Credit Agreement
and the assets subject to such Asset Sale are Pledged Shares, Secured Party
shall release the Pledged Shares that are the subject of such Asset Sale to
Pledgor free and clear of the lien and security interest under this Agreement
concurrently with the consummation of such Asset Sale; provided, further that,
as a condition precedent to such release, Secured Party shall have received
evidence satisfactory to it that arrangements satisfactory to it have been made
for delivery to Secured Party of the Net Asset Sale Proceeds of such Asset Sale;
(b) (i) cause each issuer of Pledged Shares not to issue any stock or other
securities in addition to or in substitution for the Pledged Shares issued by
such issuer, except to Pledgor, (ii) pledge hereunder, immediately upon its
acquisition (directly or indirectly) thereof, any and all additional shares of
stock or other securities of each issuer of Pledged Shares except to the extent
that such pledge would result in the pledge of more than 65% of the stock of a
Non-U.S. Issuer, and (iii) pledge hereunder, immediately upon its acquisition
(directly or indirectly) thereof, any and all shares of stock of any Person
that, after the date of this Agreement, becomes, as a result of any occurrence,
a direct Subsidiary of Pledgor unless such subsidiary is a Non-U.S. Issuer, in
which case no more than 65% of such shares of stock shall be pledged hereunder;
(c) promptly deliver to Secured Party all written notices received by it with
respect to the Pledged Collateral; and
(d) pay promptly when due all taxes, assessments and governmental charges or
levies imposed upon, and all claims against, the Pledged Collateral, except to
the extent the validity thereof is being contested in good faith; provided that
Pledgor shall in any event pay such taxes, assessments, charges, levies or
claims not later than five days prior to the date of any proposed sale of the
Pledged Collateral under any judgment, writ or warrant of attachment entered or
filed against Pledgor or any of the Pledged Collateral as a result of the
failure to make such payment.
SECTION 6. Further Assurances; Pledge Amendments.
(a) Pledgor agrees that from time to time, at the expense of Pledgor, Pledgor
will promptly execute and deliver all further instruments and documents, and
take all further action, that may be necessary or desirable, or that Secured
Party may reasonably request, in order to perfect and protect any security
interest granted or purported to be granted hereby or to enable Secured Party to
exercise and enforce its rights and remedies hereunder with respect to any
Pledged Collateral. Without limiting the generality of the foregoing, 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 Secured Party may reasonably request, in order to perfect
and preserve the security interests granted or purported to be granted hereby
and (ii) at Secured Party's reasonable request, appear in and defend any action
or proceeding that may affect Pledgor's title to or Secured Party's security
interest in all or any part of the Pledged Collateral.
(b) Pledgor further agrees that it will, upon obtaining any additional shares of
stock or other securities required to be pledged hereunder as provided in
Section 5(b) or (c), promptly (and in any event within 30 days) deliver to
Secured Party a Pledge Amendment, duly executed by Pledgor, in substantially the
form of Exhibit I annexed hereto (a "Pledge Amendment"), in respect of the
additional Pledged Shares to be pledged pursuant to this Agreement. Pledgor
hereby authorizes Secured Party to attach each Pledge Amendment to this
Agreement and agrees that all Pledged Shares listed on any Pledge Amendment
delivered to Secured Party shall for all purposes hereunder be considered
Pledged Collateral; provided that the failure of Pledgor to execute a Pledge
Amendment with respect to any additional Pledged Shares pledged pursuant to this
Agreement shall not impair the security interest of Secured Party therein or
otherwise adversely affect the rights and remedies of Secured Party hereunder
with respect thereto.
SECTION 7. Voting Rights; Dividends; Etc.
(a) So long as no Event of Default shall have occurred and be continuing:
(i) Pledgor shall be entitled to exercise any and all voting and other
consensual rights pertaining to the Pledged Collateral or any part thereof for
any purpose not inconsistent with the terms of this Agreement or the Credit
Agreement in a manner which would not have a material adverse effect on the
value of the Pledged Collateral or any part thereof. It is understood, however,
that neither (A) the voting by Pledgor of any Pledged Shares for or Pledgor's
consent to the election of directors at a regularly scheduled annual or other
meeting of stockholders or with respect to incidental matters at any such
meeting nor (B) Pledgor's consent to or approval of any action otherwise
permitted under this Agreement and the Credit Agreement shall be deemed
inconsistent with the terms of this Agreement or the Credit Agreement within the
meaning of this Section 7(a)(i).
(ii) Pledgor shall be entitled to receive and retain, and to utilize free
and clear of the lien of this Agreement, any and all dividends paid in respect
of the Pledged Collateral; provided, however, that any and all
(A) dividends paid or payable other than in cash in
respect of, and instruments and other property received,
receivable or otherwise distributed in respect of, or in
exchange for, any Pledged Collateral,
(B) dividends and other distributions paid or payable
in cash in respect of any Pledged Collateral in connection
with a partial or total liquidation or dissolution or in
connection with a reduction of capital, capital surplus or
paid-in-surplus, and
(C) cash paid, payable or otherwise distributed in
exchange for any Pledged Collateral,
shall be, and shall forthwith be delivered to Secured Party to hold as,
Pledged Collateral and shall, if received by Pledgor, be received in
trust for the benefit of Secured Party, be segregated from the other
property or funds of Pledgor and be forthwith delivered to Secured
Party as Pledged Collateral in the same form as so received (with all
necessary endorsements); and
(iii) Secured Party shall promptly execute and deliver (or cause to be
executed and delivered) to Pledgor all such dividend payment orders and other
instruments as Pledgor may from time to time reasonably request for the purpose
of enabling Pledgor to receive the dividends which it is authorized to receive
and retain pursuant to paragraph (ii) above.
(b) Upon the occurrence and during the continuation of an Event of Default:
(i) upon written notice from Secured Party to Pledgor, all rights of
Pledgor to exercise the voting and other consensual rights which it would
otherwise be entitled to exercise pursuant to Section 7(a)(i) shall cease, and
all such rights shall thereupon become vested in Secured Party who shall
thereupon have the sole right to exercise such voting and other consensual
rights;
(ii) upon written notice from Secured Party to Pledgor, all rights of
Pledgor to receive the dividends which it would otherwise be authorized to
receive and retain pursuant to Section 7(a)(ii) shall cease, and all such rights
shall thereupon become vested in Secured Party who shall thereupon have the sole
right to receive and hold as Pledged Collateral such dividends; and
(iii) upon written notice from Secured Party to Pledgor, all dividends
which are received by Pledgor contrary to the provisions of paragraph (ii) of
this Section 7(b) shall be received in trust for the benefit of Secured Party,
shall be segregated from other funds of Pledgor and shall forthwith be paid over
to Secured Party as Pledged Collateral in the same form as so received (with any
necessary endorsements). (c) In order to permit Secured Party to exercise the
voting and other consensual rights which it may be entitled to exercise pursuant
to Section 7(b)(i) and to receive all dividends and other distributions which it
may be entitled to receive under Section 7(a)(ii) or Section 7(b)(ii), (i)
Pledgor shall promptly execute and deliver (or cause to be executed and
delivered) to Secured Party all such proxies, dividend payment orders and other
instruments as Secured Party may from time to time reasonably request and (ii)
without limiting the effect of the immediately preceding clause (i), Pledgor
hereby grants to Secured Party an irrevocable proxy to vote the Pledged Shares
and to exercise all other rights, powers, privileges and remedies to which a
holder of the Pledged Shares would be entitled (including giving or withholding
written consents of shareholders, calling special meetings of shareholders and
voting at such meetings), which proxy shall be effective, automatically and
without the necessity of any action (including any transfer of any Pledged
Shares on the record books of the issuer thereof) by any other Person (including
the issuer of the Pledged Shares or any officer or agent thereof), upon the
occurrence of an Event of Default and during the continuance thereof and which
proxy shall only terminate upon the payment in full of the Secured Obligations.
SECTION 8. Secured Party Appointed Attorney-in-Fact. Pledgor hereby irrevocably
appoints Secured Party as Pledgor's attorney-in-fact, with full authority in the
place and stead of Pledgor and in the name of Pledgor, Secured Party or
otherwise, from time to time in Secured Party's discretion to take any action
and to execute any instrument that Secured Party may deem necessary or advisable
to accomplish the purposes of this Agreement, including filing one or more
financing or continuation statements, or amendments thereto, relative to all or
any part of the Pledged Collateral without the signature of Pledgor; provided,
that unless an Event of Default has occurred and is continuing, Secured Party
may not (i) receive, endorse and collect any instruments made payable to Pledgor
representing any dividend or other distribution in respect of the Pledged
Collateral or any part thereof; or (ii) file any claims or take any action or
institute any proceedings that Secured Party may deem necessary or desirable for
the collection of any of the Pledged Collateral or otherwise to enforce the
rights of Secured Party with respect to any of the Pledged Collateral.
SECTION 9. Secured Party May Perform. If Pledgor fails to perform any agreement
contained herein, Secured Party may itself perform, or cause performance of,
such agreement, and the expenses of Secured Party incurred in connection
therewith shall be payable by Pledgor under Section 13(b).
SECTION 10. Standard of Care. The powers conferred on Secured Party hereunder
are solely to protect its interest in the Pledged Collateral and shall not
impose any duty upon it to exercise any such powers. Except for the exercise of
reasonable care in the custody of any Pledged Collateral in its possession and
the accounting for moneys actually received by it hereunder, Secured Party shall
have no duty as to any Pledged Collateral, it being understood that Secured
Party shall have no responsibility for (a) ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relating to any Pledged Collateral, whether or not Secured Party has or is
deemed to have knowledge of such matters, (b) taking any necessary steps (other
than steps taken in accordance with the standard of care set forth above to
maintain possession of the Pledged Collateral) to preserve rights against any
parties with respect to any Pledged Collateral, (c) taking any necessary steps
to collect or realize upon the Secured Obligations or any guarantee therefor, or
any part thereof, or any of the Pledged Collateral, or (d) initiating any action
to protect the Pledged Collateral against the possibility of a decline in market
value. Secured Party shall be deemed to have exercised reasonable care in the
custody and preservation of Pledged Collateral in its possession if such Pledged
Collateral is accorded treatment substantially equal to that which Secured Party
accords its own property consisting of negotiable securities.
SECTION 11. Remedies.
(a) If any Event of Default shall have occurred and be continuing, Secured Party
may exercise in respect of the Pledged Collateral, in addition to all other
rights and remedies provided for herein or otherwise available to it, all the
rights and remedies of a secured party on default under the Uniform Commercial
Code as in effect in any relevant jurisdiction (the "Code") (whether or not the
Code applies to the affected Pledged Collateral), and Secured Party may also in
its sole discretion, without notice except as specified below, sell the Pledged
Collateral or any part thereof in one or more parcels at public or private sale,
at any exchange or broker's board or at any of Secured Party's offices or
elsewhere, for cash, on credit or for future delivery, at such time or times and
at such price or prices and upon such other terms as Secured Party may deem
commercially reasonable, irrespective of the impact of any such sales on the
market price of the Pledged Collateral. Secured Party or any Lender may be the
purchaser of any or all of the Pledged Collateral at any such sale and Secured
Party, as agent for and representative of Lenders (but not any Lender or Lenders
in its or their respective individual capacities unless Requisite Lenders shall
otherwise agree in writing), shall be entitled, for the purpose of bidding and
making settlement or payment of the purchase price for all or any portion of the
Pledged Collateral sold at any such public sale, to use and apply any of the
Secured Obligations as a credit on account of the purchase price for any Pledged
Collateral payable by Secured Party at such sale. Each purchaser at any such
sale shall hold the property sold absolutely free from any claim or right on the
part of Pledgor, and Pledgor hereby waives (to the extent permitted by
applicable law) all rights of redemption, stay and/or appraisal which it now has
or may at any time in the future have under any rule of law or statute now
existing or hereafter enacted. Pledgor agrees that, to the extent notice of sale
shall be required by law, at least ten Business Days' notice to Pledgor of the
time and place of any public sale or the time after which any private sale is to
be made shall constitute reasonable notification. Secured Party shall not be
obligated to make any sale of Pledged Collateral regardless of notice of sale
having been given. Secured Party may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and such sale
may, without further notice, be made at the time and place to which it was so
adjourned. Pledgor hereby waives any claims against Secured Party arising by
reason of the fact that the price at which any Pledged Collateral may have been
sold at such a private sale was less than the price which might have been
obtained at a public sale, even if Secured Party accepts the first offer
received and does not offer such Pledged Collateral to more than one offeree. If
the proceeds of any sale or other disposition of the Pledged Collateral are
insufficient to pay all the Secured Obligations, Pledgor shall be liable for the
deficiency and the fees of any attorneys employed by Secured Party to collect
such deficiency.
(b) Pledgor recognizes that, by reason of certain prohibitions contained in the
Securities Act and applicable state securities laws, Secured Party may be
compelled, with respect to any sale of all or any part of the Pledged Collateral
conducted without prior registration or qualification of such Pledged Collateral
under the Securities Act and/or such state securities laws, to limit purchasers
to those who will agree, among other things, to acquire the Pledged Collateral
for their own account, for investment and not with a view to the distribution or
resale thereof. Pledgor acknowledges that any such private sales may be at
prices and on terms less favorable than those obtainable through a public sale
without such restrictions (including a public offering made pursuant to a
registration statement under the Securities Act) and, notwithstanding such
circumstances, Pledgor agrees that any such private sale shall be deemed to have
been made in a commercially reasonable manner and that Secured Party shall have
no obligation to engage in public sales and no obligation to delay the sale of
any Pledged Collateral for the period of time necessary to permit the issuer
thereof to register it for a form of public sale requiring registration under
the Securities Act or under applicable state securities laws, even if such
issuer would, or should, agree to so register it.
(c) If Secured Party determines to exercise its right to sell any or all of the
Pledged Collateral, upon written request, Pledgor shall and shall cause each
issuer of any Pledged Shares to be sold hereunder from time to time to furnish
to Secured Party all such information as Secured Party may request in order to
determine the number of shares and other instruments included in the Pledged
Collateral which may be sold by Secured Party in exempt transactions under the
Securities Act and the rules and regulations of the Securities and Exchange
Commission thereunder, as the same are from time to time in effect.
SECTION 12. Application of Proceeds. All proceeds received by Secured Party in
respect of any sale of, collection from, or other realization upon all or any
part of the Pledged Collateral shall be applied as provided in subsection 2.4D
of the Credit Agreement.
SECTION 13. Indemnity and Expenses.
(a) Pledgor agrees to indemnify Secured Party and each Lender for and against
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses (including reasonable counsel fees and
disbursements) or disbursements of any kind or nature whatsoever in any way
relating to, growing out of or resulting from this Agreement and the
transactions contemplated hereby (including enforcement of this Agreement),
except to the extent such claims, losses or liabilities result solely from
Secured Party's or such Lender's gross negligence or willful misconduct.
(b) Pledgor shall pay to Secured Party upon demand the amount of any and all
actual and reasonable costs and expenses, including the reasonable fees and
expenses of its counsel and of any experts and agents, that Secured Party 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 the Pledged Collateral, (iii) the exercise or
enforcement of any of the rights of Secured Party hereunder, or (iv) the failure
by Pledgor to perform or observe any of the provisions hereof.
SECTION 14. Continuing Security Interest; Transfer of Loans. This Agreement
shall create a continuing security interest in the Pledged Collateral and shall
(a) remain in full force and effect until the payment in full of all Secured
Obligations, the cancellation or termination of the Commitments and the
cancellation or expiration of all outstanding Letters of Credit, (b) be binding
upon Pledgor, its successors and assigns, and (c) inure, together with the
rights and remedies of Secured Party hereunder, to the benefit of Secured Party
and its successors, transferees and assigns. Without limiting the generality of
the foregoing clause (c), but subject to the provisions of subsection 10.1 of
the Credit Agreement, any Lender may assign or otherwise transfer any Loans held
by it to any other Person, and such other Person shall thereupon become vested
with all the benefits in respect thereof granted to Lenders herein or otherwise.
Upon the payment in full of all Secured Obligations, the cancellation or
termination of the Commitments and the cancellation or expiration of all
outstanding Letters of Credit, the security interest granted hereby shall
terminate and all rights to the Pledged Collateral shall revert to Pledgor. Upon
any such termination Secured Party will, at Pledgor's expense, execute and
deliver to Pledgor such documents as Pledgor shall reasonably request to
evidence such termination and Pledgor shall be entitled to the return, upon its
request and at its expense, against receipt and without recourse to Secured
Party, of such of the Pledged Collateral as shall not have been sold or
otherwise applied pursuant to the terms hereof.
SECTION 15. Secured Party as Agent.
(a) Secured Party has been appointed to act as Secured Party hereunder by
Lenders. Secured Party shall be obligated, and shall have the right hereunder,
to make demands, to give notices, to exercise or refrain from exercising any
rights, and to take or refrain from taking any action (including the release or
substitution of Pledged Collateral), solely in accordance with this Agreement
and the Credit Agreement; provided that Secured Party shall exercise, or refrain
from exercising, any remedies provided for in Section 11 in accordance with the
instructions of Requisite Lenders.
(b) Secured Party shall at all times be the same Person that is Administrative
Agent under the Credit Agreement. Written notice of resignation by
Administrative Agent pursuant to subsection 9.5 of the Credit Agreement shall
also constitute notice of resignation as Secured Party under this Agreement;
removal of Administrative Agent pursuant to subsection 9.5 of the Credit
Agreement shall also constitute removal as Secured Party under this Agreement;
and appointment of a successor Administrative Agent pursuant to subsection 9.5
of the Credit Agreement shall also constitute appointment of a successor Secured
Party under this Agreement. Upon the acceptance of any appointment as Agent
under subsection 9.5 of the Credit Agreement by a successor Administrative
Agent, that successor Administrative Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring or
removed Secured Party under this Agreement, and the retiring or removed Secured
Party under this Agreement shall promptly (i) transfer to such successor Secured
Party all sums, securities and other items of Collateral held hereunder,
together with all records and other documents necessary or appropriate in
connection with the performance of the duties of the successor Secured Party
under this Agreement, and (ii) execute and deliver to such successor Secured
Party such amendments to financing statements, and take such other actions, as
may be necessary or appropriate in connection with the assignment to such
successor Secured Party of the security interests created hereunder, whereupon
such retiring or removed Secured Party shall be discharged from its duties and
obligations under this Agreement. After any retiring or removed Administrative
Agent's resignation or removal hereunder as Secured Party, the provisions of
this Agreement shall inure to its benefit as to any actions taken or omitted to
be taken by it under this Agreement while it was Secured Party hereunder.
SECTION 16. Amendments; Etc. No amendment, modification, termination or waiver
of any provision of this Agreement, and no consent to any departure by Pledgor
therefrom, shall in any event be effective unless the same shall be in writing
and signed by Secured Party and, in the case of any such amendment or
modification, by Pledgor. Any such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which it was given.
SECTION 17. Notices. Any notice or other communication herein required or
permitted to be given shall be in writing and may be personally served, telexed
or sent by telefacsimile or United States mail or courier service and shall be
deemed to have been given when delivered in person or by courier service, upon
receipt of telefacsimile or telex, or three Business Days after depositing it in
the United States mail with postage prepaid and properly addressed. For the
purposes hereof, the address of each party hereto shall be as set forth under
such party's name on the signature pages hereof or, as to either party, such
other address as shall be designated by such party in a written notice delivered
to the other party hereto.
SECTION 18. Failure or Indulgence Not Waiver; Remedies Cumulative. No failure or
delay on the part of Secured Party in the exercise of any power, right or
privilege hereunder shall impair such power, right or privilege or be construed
to be a waiver of any default or acquiescence therein, nor shall any single or
partial exercise of any such power, right or privilege preclude any other or
further exercise thereof or of any other power, right or privilege. All rights
and remedies existing under this Agreement are cumulative to, and not exclusive
of, any rights or remedies otherwise available.
SECTION 19. Severability. In case any provision in or obligation under this
Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
SECTION 20. Headings. 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.
SECTION 21. Governing Law; Terms; Rules of Construction. THIS AGREEMENT AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL
BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE
OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES, EXCEPT TO THE
EXTENT THAT THE CODE PROVIDES THAT THE PERFECTION OF THE SECURITY INTEREST
HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR PLEDGED
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK. Unless otherwise defined herein or in the Credit Agreement, terms used
in Articles 8 and 9 of the Uniform Commercial Code in the State of New York are
used herein as therein defined. The rules of construction set forth in
subsection 1.3 of the Credit Agreement shall be applicable to this Agreement
mutatis mutandis.
SECTION 22. Consent to Jurisdiction and Service of Process. ALL JUDICIAL
PROCEEDINGS BROUGHT AGAINST PLEDGOR ARISING OUT OF OR RELATING TO THIS
AGREEMENT, OR ANY OBLIGATIONS HEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL
COURT OF COMPETENT JURISDICTION IN XXX XXXXX, XXXXXX XXX XXXX XX XXX XXXX. BY
EXECUTING AND DELIVERING THIS AGREEMENT, PLEDGOR, FOR ITSELF AND IN CONNECTION
WITH ITS PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL, RETURN RECEIPT REQUESTED, TO PLEDGOR AT ITS ADDRESS PROVIDED IN
ACCORDANCE WITH SECTION 18;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS
SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER PLEDGOR IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND
BINDING SERVICE IN EVERY RESPECT;
(V) AGREES THAT SECURED PARTY RETAINS THE RIGHT TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS
AGAINST PLEDGOR IN THE COURTS OF ANY OTHER JURISDICTION; AND
(VI) AGREES THAT THE PROVISIONS OF THIS SECTION 23 RELATING TO
JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE FULLEST
EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW SECTION
5-1402 OR OTHERWISE.
SECTION 23. Waiver of Jury Trial. PLEDGOR AND SECURED PARTY HEREBY AGREE TO
WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF THIS AGREEMENT. The scope of this waiver is
intended to be all-encompassing of any and all disputes that may be filed in any
court and that relate to the subject matter of this transaction, including
contract claims, tort claims, breach of duty claims, and all other common law
and statutory claims. Pledgor and Secured Party each acknowledge that this
waiver is a material inducement for Pledgor and Secured Party to enter into a
business relationship, that Pledgor and Secured Party have already relied on
this waiver in entering into this Agreement and that each will continue to rely
on this waiver in their related future dealings. Pledgor and Secured Party
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 (OTHER THAN BY A MUTUAL
WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SECTION 24 AND EXECUTED BY EACH OF
THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. In the event of
litigation, this Agreement may be filed as a written consent to a trial by the
court.
SECTION 24. Counterparts. This Agreement may be executed in one or more
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;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document.
IN WITNESS WHEREOF, Pledgors and Secured Party have caused
this Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
ESI CANADA HOLDINGS, INC.
VALUE HEALTH, INC.
VALUERX, INC.
Each as a Pledgor
By: /s/ Xxxxxx Xxx
Name: Xxxxxx Xxx
Title: Senior Vice President
Notice Address:
00000 Xxxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Attention:
CREDIT SUISSE FIRST BOSTON,
as Secured Party
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title:Vice President
Notice Address:
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:
SCHEDULE I
Attached to and forming a part of the Pledge Agreement dated
as of April 1, 1999 between each of the Pledgors party thereto, and Credit
Suisse First Boston, as Secured Party.
Part A
Stock Certificate Number of
Stock Issuer Class of Stock Nos. Par Value Shares
--------------------------------------------------------------------------------
EXHIBIT I
PLEDGE AMENDMENT
This Pledge Amendment, dated __________, ____, is delivered
pursuant to Section 6(b) of the Pledge Agreement referred to below. The
undersigned hereby agrees that this Pledge Amendment may be attached to the
Pledge Agreement dated April 1, 1999, between the Pledgors party thereto and
Credit Suisse First Boston, as Secured Party (the "Pledge Agreement,"
capitalized terms defined therein being used herein as therein defined), and
that the Pledged Shares listed on this Pledge Amendment shall be deemed to be
part of the Pledged Shares and shall become part of the Pledged Collateral and
shall secure all Secured Obligations.
[NAME OF PLEDGOR]
By:
Title:
Stock Certificate Number of
Stock Issuer Class of Stock Nos. Par Value Shares
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