Exhibit 10.21
PLEDGE AGREEMENT
WILSONS THE LEATHER EXPERTS INC.
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PLEDGE AGREEMENT, dated as of May 25, 1996, (this "Agreement") between
WILSONS THE LEATHER EXPERTS INC. ("Pledgor"), and GENERAL ELECTRIC CAPITAL
CORPORATION, a New York corporation individually and as agent (in such capacity,
"Agent") for the lenders ("Lenders") signatory to the Credit Agreement as
hereinafter defined.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Pledgor is the record and beneficial owner of all the shares
of stock described in Schedule I hereto (the "Pledged Shares") issued by the
corporation named therein;
WHEREAS, Pledgor has entered into a certain Credit Agreement dated as
of the date hereof with, among others, Borrower, Agent and Lenders (as amended,
supplemented, restated or otherwise modified from time to time, the "Credit
Agreement");
WHEREAS, Pledgor has guaranteed the payment of the Obligations of the
Borrower under the Credit Agreement pursuant to a separate Guaranty of even date
herewith;
WHEREAS, in connection with the making of the loans under the Credit
Agreement and as security for all of the Obligations (as defined in the Credit
Agreement) of Pledgor, Lenders and Agent are requiring that Pledgor shall have
executed and delivered this Agreement and granted the security interest
contemplated hereby;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained and to induce the Lenders to make loans under the Credit
Agreement, it is agreed as follows:
1. Definitions. Unless otherwise defined herein, terms defined in
the Credit Agreement are used herein as therein defined, and the following shall
have (unless otherwise provided elsewhere in this Agreement) the following
respective meanings (such meanings being equally applicable to both the singular
and plural form of the terms defined):
"Bankruptcy Code" shall mean Xxxxx 00, Xxxxxx Xxxxxx Code, as amended
from time to time, and any successor statute thereto.
"Pledged Collateral" shall have the meaning assigned to such term in
Section 2 hereof.
"Secured Obligations" shall have the meaning assigned to such term in
Section 3 hereof.
2. Pledge. Pledgor hereby pledges to Agent, for its benefit and for
the ratable benefit of Lenders, and grants to Agent, for its benefit and the
ratable benefit of Lenders, a first priority security interest in, all of the
following (collectively, the "Pledged Collateral"):
(i) the Pledged Shares and the certificates representing the
Pledged Shares, and all dividends, distributions, cash, 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 of Pledgor;
(ii) all additional shares of 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), and the certificates
representing such additional shares, and all dividends, distributions,
cash, 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; and
(iii) all Stock owned by Pledgor of any Person who, after the
date of this Agreement, becomes, as a result of any occurrence, a directly
owned Subsidiary of Pledgor (which Stock shall be deemed to be part of the
Pledged Shares) and the certificates, if any, representing such Stock, and
all dividends, distributions, cash, 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 Stock.
3. Security for Obligations. This Agreement secures, and the Pledged
Collateral is security for, the prompt payment in full when due, whether at
stated maturity, by acceleration or otherwise, and performance of the
Obligations of Pledgor, whether for principal, premium, interest, fees, costs
and expenses, and all obligations of Pledgor now or hereafter existing under
this Agreement and under the Credit Agreement (collectively, the "Secured
Obligations").
4. Delivery of Pledged Collateral. All certificates representing or
evidencing the Pledged Shares shall be delivered to and held by or on behalf of
Agent, for its benefit and the ratable benefit of Lenders, pursuant hereto and
shall be accompanied by duly executed instruments of transfer or assignment in
blank, all in form and substance satisfactory to Agent. Agent shall have the
right, after acceleration of the Secured Obligations or the failure to pay the
Secured Obligations at maturity in its discretion and without notice to Pledgor,
to transfer to or to register in the name of Agent for its benefit and the
ratable benefit of Lenders, or any of its nominees any or all of the Pledged
Shares. In addition, Agent shall have the right at anytime to exchange
certificates or instruments representing or evidencing Pledged Shares for
certificates or instruments of smaller or larger denominations.
5. Representations and Warranties. Pledgor represents and warrants
to Agent and Lenders that:
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(a) Pledgor is, and at the time of delivery of the Pledged Shares to
Agent pursuant to Section 4 hereof will be, the sole holder of record and the
sole beneficial owner of the Pledged Collateral pledged by Pledgor free and
clear of any Lien thereon or affecting the title thereto, except for the Lien
created by this Agreement, the subordinated pledge to Seller and any restrictive
legend appearing on any certificate representing Pledged Shares.
(b) All of the Pledged Shares have been duly authorized, validly
issued and are fully paid and non-assessable.
(c) Pledgor has the right and requisite authority to pledge, assign,
transfer, deliver, deposit and set over the Pledged Collateral pledged by
Pledgor to Agent, for its benefit and the ratable benefit of Lenders, as
provided herein.
(d) None of the Pledged Shares has been issued or transferred in
violation of the securities registration, securities disclosure or similar laws
of any jurisdiction to which such issuance or transfer may be subject.
(e) Except as set forth on Schedule I hereto, all of the Stock of
each Subsidiary is presently owned by the Pledgor as set forth on Schedule I
hereto, and is presently represented by the stock certificates listed on
Schedule I hereto. As of the date hereof, there are no existing options,
warrants, calls or commitments of any character whatsoever relating to the Stock
of the Subsidiaries of Pledgor.
(f) No consent, approval, authorization or other order of any Person
and no consent, authorization, approval, or other action by, and no notice to or
filing with, any governmental authority is required either (i) for the pledge by
Pledgor of the Pledged Collateral pursuant to this Agreement or for the
execution, delivery or performance of this Agreement by Pledgor or (ii) for the
exercise by the Agent, for its benefit and the ratable benefit of Lenders, of
the voting or other rights provided for in this Agreement or the remedies in
respect of the Pledged Collateral pursuant to this Agreement, except as may be
required in connection with such disposition by laws affecting the offering and
sale of securities generally.
(g) The pledge, assignment and delivery of the Pledged Collateral
pursuant to this Agreement will create a valid first priority Lien on and a
first priority perfected security interest in the Pledged Collateral pledged by
Pledgor, and the proceeds thereof, securing the payment of the Secured
Obligations, subject to no other Lien or security interest, other than the
subordinated pledge to Seller and any restrictive legend appearing on any
certificate representing Pledged Shares.
(h) This Agreement has been duly authorized, executed and delivered
by Pledgor and constitutes a legal, valid and binding obligation of Pledgor
enforceable in accordance with its terms.
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(i) The Subsidiary listed on Schedule I hereto is the only direct
Subsidiary of Pledgor. Except as set forth on Schedule I hereto, the Pledged
Shares constitute 100% of the issued and outstanding shares of stock of the
issuer thereof.
The representations and warranties set forth in this Section 5 shall
survive the execution and delivery of this Agreement.
6. Covenants. Pledgor covenants and agrees that until the
Termination Date:
(a) Without the prior written consent of Agent, Pledgor will not
sell, assign, transfer, pledge, or otherwise encumber any of its rights in or to
the Pledged Collateral pledged by Pledgor or any unpaid dividends or other
distributions or payments with respect thereto or xxxxx x Xxxx in any therein.
(b) Pledgor will, at its expense, promptly execute, acknowledge and
deliver all such instruments and take all such action as Agent from time to time
may request in order to ensure to Agent the benefits of the Liens in and to the
Pledged Collateral intended to be created by this Agreement, including the
filing of any necessary Code financing statements, which may be filed by Agent
with or without the signature of Pledgor, and will cooperate with Agent, at
Pledgor's expense, in obtaining all necessary approvals and making all necessary
filings under federal or state law in connection with such Liens or any sale or
transfer of the Pledged Collateral.
(c) Pledgor has and will defend the title to the Pledged Collateral
and the Liens of Agent and Lenders thereon against the claim of any Person and
will maintain and preserve such Liens until the Termination Date.
(d) Pledgor will, upon obtaining any additional shares of any
Subsidiaries or, any new directly owned Subsidiary, which shares are not already
Pledged Collateral, promptly (and in any event within three (3) Business Days)
deliver to Agent a Pledge Amendment, duly executed by such Pledgor, in
substantially the form of Schedule II hereto (a "Pledge Amendment"), in respect
of the additional Pledged Shares which are to be pledged pursuant to this
Agreement. Pledgor hereby authorizes Agent to attach each Pledge Amendment to
this Agreement and agrees that all Pledged Shares listed on any Pledge Amendment
delivered to Agent shall for all purposes hereunder be considered Pledged
Collateral.
7. Pledgor's Rights. As long as no Event of Default shall have
occurred and be continuing and until written notice shall be given to Pledgor in
accordance with Section 8(a) hereof,
(a) Pledgor shall have the right, from time to time, to vote and give
consents with respect to the Pledged Collateral or any part thereof for all
purposes not inconsistent with the provisions of this Agreement, the Credit
Agreement, and any other Loan
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Document; provided, however, that no vote shall be cast, and no consent shall be
given or action taken, which would have the effect of impairing the position or
interest of Agent or Lenders in respect of the Pledged Collateral or which would
authorize or effect (except as and to the extent expressly permitted by the
Credit Agreement) (i) the dissolution or liquidation, in whole or in part, of
any of Pledgor's Subsidiaries, (ii) the consolidation or merger of any of
Pledgor's Subsidiaries with any other Person, (iii) the sale, disposition or
encumbrance of all or substantially all of the assets of any of Pledgor's
Subsidiaries, (iv) any change in the authorized number of shares, the stated
capital or the authorized share capital of any of such Pledgor's Subsidiaries or
the issuance of any additional shares of such Subsidiary's Stock, or (v) the
alteration of the voting rights with respect to the Stock of any of such
Pledgor's Subsidiaries;
(b) (i) Pledgor shall be entitled, from time to time, to
collect and receive for its own respective use all cash dividends paid in
respect of the Pledged Shares to the extent not in violation of the Credit
Agreement other than 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, and (C) cash paid, payable or
otherwise distributed in redemption of, or in exchange for, any Pledged
Collateral; provided, however, that until actually paid all rights to such
distributions shall remain subject to the Lien created by this Agreement;
and
(ii) all dividends (other than such cash dividends as are
permitted to be paid to Pledgor in accordance with clause (i) above) and
all other distributions in respect of any of the Pledged Shares of Pledgor,
whenever paid or made, shall be delivered to Agent to hold as Pledged
Collateral and shall, if received by Pledgor, be received in trust for the
benefit of Agent and the ratable benefit of Lenders, be segregated from the
other property or funds of Pledgor, and be forthwith delivered to Agent as
Pledged Collateral in the same form as so received (with any necessary
indorsement).
8. Defaults and Remedies. (a) Upon acceleration of the Secured
Obligations or failure to pay the Secured Obligations at maturity and upon
written notice to Pledgor, Agent (personally or through an agent) is hereby
authorized and empowered to transfer and register in its name or in the name of
its nominee the whole or any part of the Pledged Collateral, to exchange
certificates or instruments representing or evidencing Pledged Shares for
certificates or instruments of smaller or larger denominations, to exercise the
voting and all other rights as a stockholder with respect thereto, to collect
and receive all cash dividends and other distributions made thereon, to sell in
one or more sales after at least ten (10) days' notice of the time and place of
any public sale or of the time after which a private sale is to take place
(which notice Pledgor agrees is commercially reasonable), but without any
previous notice or advertisement, the whole or any part of the Pledged
Collateral and to
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otherwise act with respect to the Pledged Collateral as though Agent was the
outright owner thereof, Pledgor hereby irrevocably constituting and appointing
Agent as the proxy and attorney-in-fact of Pledgor, with full power of
substitution to do so, and which shall remain in effect until the Obligations
are indefeasibly paid in full; provided, however, Agent shall not have any duty
to exercise any such right or to preserve the same and shall not be liable for
any failure to do so or for any delay in doing so. Any sale shall be made at a
public or private sale at Agent's place of business, or at any or elsewhere to
be named in the notice of sale, either for cash or upon credit or for future
delivery at such price as Agent may deem fair, and Agent or any Lender may be
the purchaser of the whole or any part of the Pledged Collateral so sold and
hold the same thereafter in its own right free from any claim of Pledgor or any
right of redemption. Each sale shall be made to the highest bidder, but Agent
reserves the right to reject any and all bids at such sale which, in its
discretion, it shall deem inadequate. Demands of performance, except as
otherwise herein specifically provided for, notices of sale, advertisements and
the presence of property at sale are hereby waived and any sale hereunder may be
conducted by an auctioneer or any officer or agent of Agent.
(b) If, at the original time or times appointed for the sale of the
whole or any part of the Pledged Collateral, the highest bid, if there be but
one sale, shall be inadequate to discharge in full all the Obligations, or if
the Pledged Collateral be offered for sale in lots, if at any of such sales, the
highest bid for the lot offered for sale would indicate to Agent, in its
discretion, the unlikelihood of the proceeds of the sales of the whole of the
Pledged Collateral being sufficient to discharge all the Obligations, Agent may,
on one or more occasions and in its discretion, postpone any of said sales by
public announcement at the time of sale or the time of previous postponement of
sale, and no other notice of such postponement or postponements of sale need be
given, any other notice being hereby waived; provided, however, that any sale or
sales made after such postponement shall be after ten (10) days' notice to
Pledgor.
(c) In the event of any sales hereunder Agent shall, after deducting
all costs or expenses of every kind (including reasonable attorneys' fees and
disbursements) for care, safekeeping, collection, sale, delivery or otherwise,
apply the residue of the proceeds of the sales to the payment or reduction,
either in whole or in part, of the Secured Obligations in accordance with the
agreements and instruments governing and evidencing such Obligations, returning
the surplus, if any, to Pledgor.
(d) If, at any time when Agent shall determine to exercise its right
to sell the whole or any part of the Pledged Collateral hereunder, such Pledged
Collateral or the part thereof to be sold shall not, for any reason whatsoever,
be effectively registered under the Securities Act of 1933, as amended (the
"Act"), Agent may, in its discretion (subject only to applicable requirements of
law), sell such Pledged Collateral or part thereof by private sale in such
manner and under such circumstances as Agent may deem necessary or advisable,
but subject to the other requirements of this Section 8, and shall not be
required to effect such registration or to cause the same to be effected.
Without limiting the generality of the foregoing, in any such event Agent in its
discretion (x) may, in accordance with applicable
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securities laws, proceed to make such private sale notwithstanding that a
registration statement for the purpose of registering such Pledged Collateral or
part thereof could be or shall have been filed under said Act (or similar
statute), (y) may approach and negotiate with a single possible purchaser to
effect such sale, and (z) may restrict such sale to a purchaser who will
represent and agree that such purchaser is purchasing for its own account, for
investment and not with a view to the distribution or sale of such Pledged
Collateral or part thereof. In addition to a private sale as provided above in
this Section 8, if any of the Pledged Collateral shall not be freely
distributable to the public without registration under the Act (or similar
statute) at the time of any proposed sale pursuant to this Section 8, then Agent
shall not be required to effect such registration or cause the same to be
effected but, in its discretion (subject only to applicable requirements of
law), may require that any sale hereunder (including a sale at auction) be
conducted subject to restrictions (i) as to the financial sophistication and
ability of any Person permitted to bid or purchase at any such sale, (ii) as to
the content of legends to be placed upon any certificates representing the
Pledged Collateral sold in such sale, including restrictions on future transfer
thereof, (iii) as to the representations required to be made by each Person
bidding or purchasing at such sale relating to that Person's access to financial
information about Pledgor and such Person's intentions as to the holding of the
Pledged Collateral so sold for investment, for its own account, and not with a
view to the distribution thereof, and (iv) as to such other matters as Agent
may, in its discretion, deem necessary or appropriate in order that such sale
(notwithstanding any failure so to register) may be effected in compliance with
the Bankruptcy Code and other laws affecting the enforcement of creditors'
rights and the Act and all applicable state securities laws.
(e) Pledgor acknowledges that any private sale may result in prices
and other terms less favorable to the seller than if such sale were a public
sale and, notwithstanding such circumstances, agree that any such private sale
shall be deemed to have been made in a commercially reasonable manner. Agent
shall be under no obligation to delay a sale of any of the Pledged Collateral
for the period of time necessary to permit the registrant to register such
securities for public sale under the Act, or under applicable state securities
laws, even if Pledgor would agree to do so.
(f) Pledgor agrees that following the occurrence and during the
continuance of an Event of Default it will not at any time plead, claim or take
the benefit of any appraisal, valuation, stay, extension, moratorium or
redemption law now or hereafter in force in order to prevent or delay the
enforcement of this Agreement, or the absolute sale of the whole or any part of
the Pledged Collateral or the possession thereof by any purchaser at any sale
hereunder, and Pledgor waives the benefit of all such laws to the extent it
lawfully may do so. Pledgor agrees that it will not interfere with any right,
power and remedy of Agent provided for in this Agreement or now or hereafter
existing at law or in equity or by statute or otherwise, or the exercise or
beginning of the exercise by Agent of any one or more of such rights, powers or
remedies.
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(g) Pledgor further agrees that a breach of any of the covenants
contained in this Section 8 will cause irreparable injury to Agent and Lenders,
that Agent has no adequate remedy at law in respect of such breach and, as a
consequence, agrees that each and every covenant contained in this Section 8
shall be specifically enforceable against Pledgor, and Pledgor hereby waives and
agrees not to assert any defenses against an action for specific performance of
such covenants except for a defense that the Secured Obligations are not then
due and payable in accordance with the agreements and instruments governing and
evidencing such obligations. Pledgor further acknowledges the impossibility of
ascertaining the amount of damages which would be suffered by Agent by reason of
a breach of any of such covenants and, consequently, agrees that, if Agent shall
xxx for damages for breach, it shall pay, as liquidated damages and not as a
penalty, an amount equal to the lesser of (i) the value of the Pledged
Collateral pledged by Pledgor on the date Agent shall demand compliance with
this Section 8, and (ii) the amount required to pay in full the Secured
Obligations.
9. Application of Proceeds. Any cash held by Agent as Pledged
Collateral and all cash proceeds received by Agent in respect of any sale of,
liquidation of, or other realization upon all or any part of the Pledged
Collateral shall be applied by Agent in accordance with the Credit Agreement.
10. Waiver. No delay on Agent's part in exercising any power of
sale, Lien, option or other right hereunder, and no notice or demand which may
be given to or made upon Pledgor by Agent with respect to any power of sale,
Lien, option or other right hereunder, shall constitute a waiver thereof, or
limit or impair Agent's right to take any action or to exercise any power of
sale, Lien, option, or any other right hereunder, without notice or demand, or
prejudice Agent's rights as against Pledgor in any respect.
11. Assignment. Agent or any Lender may assign, indorse or transfer
any instrument evidencing all or any part of the Secured Obligations as provided
in, and in accordance with, the Credit Agreement, and the holder of such
instrument shall be entitled to the benefits of this Agreement.
12. Termination. On the Termination Date, and immediately following
the indefeasible payment in full of all Obligations and termination of the
commitments under the Credit Agreement, Agent shall deliver to Pledgor the
Pledged Collateral pledged by Pledgor at the time subject to this Agreement and
all instruments of assignment executed in connection therewith, free and clear
of the Liens hereof and, except as otherwise provided herein, all of Pledgor's
obligations hereunder shall at such time terminate.
13. Lien Absolute. All rights of Agent and Lenders hereunder, and
all obligations of Pledgor hereunder, shall be absolute and unconditional
irrespective of:
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(a) any lack of validity or enforceability of the Credit Agreement,
the Notes, any other Loan Document or any other agreement or instrument
governing or evidencing any Secured Obligations;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any part of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from the Credit
Agreement, the Notes, any other Loan Document or any other agreement or
instrument governing or evidencing any Secured Obligations;
(c) any exchange, release or non-perfection of any other collateral,
or any release or amendment or waiver of or consent to departure from any
guaranty, for all or any of the Secured Obligations; or
(d) any other circumstance which might otherwise constitute a defense
available to, or a discharge of, Pledgor.
14. Release. Pledgor consents and agrees that Agent and Lenders may
at any time, or from time to time, in their discretion (a) renew, extend or
change the time of payment, and/or the manner, place or terms of payment of all
or any part of the Secured Obligations and (b) exchange, release and/or
surrender all or any of the Pledged Collateral, or any part thereof, by
whomsoever deposited, which is now or may hereafter be held by Agent in
connection with all or any of the Secured Obligations; all in such manner and
upon such terms as Agent and Lenders may deem proper, and without notice to or
further assent from Pledgor, it being hereby agreed that Pledgor shall be and
remain bound upon this Agreement, irrespective of the existence, value or
condition of any of the Pledged Collateral, and notwithstanding any such change,
exchange, settlement, compromise, surrender, release, renewal or extension, and
notwithstanding also that the Secured Obligations may, at any time, exceed the
aggregate principal amount thereof set forth in the Credit Agreement, or any
other agreement governing any Secured Obligations. Pledgor hereby waives notice
of acceptance of this Agreement, and also presentment, demand, protest and
notice of dishonor of any and all of the Secured Obligations, and promptness in
commencing suit against any party hereto or liable hereon, and in giving any
notice to or of making any claim or demand hereunder upon Pledgor. No act or
omission of any kind on Agent's part shall in any event affect or impair this
Agreement.
15. Indemnification. Pledgor agrees to indemnify and hold Agent and
Lender harmless from and against any taxes, liabilities, claims and damages,
including reasonable attorney's fees and disbursements, and other expenses
incurred or arising by reason of the taking or the failure to take action by
Agent, in good faith, in respect of any transaction effected under this
Agreement or in connection with the Lien provided for herein, including, without
limitation, any taxes payable in connection with the delivery or registration of
any of the Pledged Collateral as provided herein. Whether or not the
transactions contemplated by this Agreement shall be consummated, Pledgor agrees
to pay to Agent all
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out-of-pocket costs and expenses incurred in connection with this Agreement and
all reasonable fees, expenses and disbursements, and the reasonable fees of
Agent's agents or representatives, incurred in connection with the execution and
delivery of this Agreement and the performance by Agent of the provisions of
this Agreement and of any transactions effected in connection with this
Agreement. The obligations of Pledgor under this Section 15 shall survive the
termination of this Agreement.
16. Reinstatement. This Agreement shall remain in full force and
effect and continue to be effective should any petition be filed by or against
Pledgor for liquidation or reorganization, should Pledgor become insolvent or
make an assignment for the benefit of creditors or should a receiver or trustee
be appointed for all or any significant part of Pledgor's assets, and shall
continue to be effective or be reinstated, as the case may be, if at any time
payment and performance of the Secured Obligations, or any part thereof, is,
pursuant to applicable law, rescinded or reduced in amount, or must otherwise be
restored or returned by any obligee of the Secured Obligations, whether as a
"voidable preference", "fraudulent conveyance", or otherwise, all as though such
payment or performance had not been made. In the event that any payment, or any
part thereof, is rescinded, reduced, restored or returned, the Secured
Obligations shall be reinstated and deemed reduced only by such amount paid and
not so rescinded, reduced, restored or returned.
17. Miscellaneous. (a) Agent may execute any of its duties hereunder
by or through agents or employees and shall be entitled to advice of counsel
concerning all matters pertaining to its duties hereunder.
(b) Pledgor agrees to promptly reimburse Agent for actual out-of-
pocket expenses, including, without limitation, reasonable counsel fees,
incurred by Agent in connection with the administration and enforcement of this
Agreement.
(c) Neither Agent nor any Lender nor any of their respective officers,
directors, employees, agents or counsel shall be liable for any action lawfully
taken or omitted to be taken by it or them hereunder or in connection herewith,
except for its or their own gross negligence or willful misconduct.
(d) This Agreement and all obligations of Pledgor hereunder shall be
binding upon the successors and assigns of Pledgor and shall, together with the
rights and remedies of Agent, for the benefit of Agent and Lenders, hereunder,
inure to the benefit of Agent and Lenders, all future holders of any instrument
evidencing any of the Obligations and their respective successors and assigns.
No sales of participations, other sales, assignments, transfers or other
dispositions of any agreement governing or instrument evidencing the Obligations
or any portion thereof or interest therein shall in any manner affect the
security interest granted to Agent, for the benefit of Agent and Lenders,
hereunder.
(e) EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN ANY OF THE LOAN
DOCUMENTS, IN ALL RESPECTS, INCLUDING ALL MATTERS
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OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS
ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF ILLINOIS (WITHOUT REGARD TO CONFLICT OF LAW
PROVISIONS), AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. PLEDGOR
HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN XXXX
COUNTY, CITY OF CHICAGO, ILLINOIS, SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND
DETERMINE ANY CLAIMS OR DISPUTES AMONG PLEDGOR, AGENT AND LENDERS PERTAINING TO
THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY MATTER ARISING OUT
OF OR RELATING TO THIS SECURITY AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS,
PROVIDED, AGENT, LENDERS AND PLEDGOR ACKNOWLEDGE THAT ANY APPEALS FROM THOSE
COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF XXXX COUNTY, CITY OF
CHICAGO, ILLINOIS, AND, PROVIDED, FURTHER, THAT NOTHING IN THIS AGREEMENT SHALL
BE DEEMED OR OPERATE TO PRECLUDE AGENT FROM BRINGING SUIT OR TAKING OTHER LEGAL
ACTION IN ANY OTHER JURISDICTION TO REALIZE ON THE PLEDGED COLLATERAL OR ANY
OTHER SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT
ORDER IN FAVOR OF AGENT. PLEDGOR EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO
SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND PLEDGOR
HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL
JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE
GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH
COURT. PLEDGOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND
OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH
SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL ADDRESSED TO PLEDGOR AT THE ADDRESS SET FORTH ON SCHEDULE J TO THE CREDIT
AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF
ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER
POSTAGE PREPAID.
(f) BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL
TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND
EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY
(RATHER THAN ARBITRATION RULES), PLEDGOR AND AGENT DESIRE THAT DISPUTES ARISING
HEREUNDER OR RELATING HERETO BE
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RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE
BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION,
PLEDGOR AND AGENT WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT OR
PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT,
OR OTHERWISE, AMONG AGENT, LENDERS, AND PLEDGOR ARISING OUT OF, CONNECTED WITH,
RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED IN CONNECTION WITH,
THIS AGREEMENT, THE CREDIT AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR THE
TRANSACTIONS RELATED HERETO OR THERETO.
(g) NO WAIVER; CUMULATIVE REMEDIES. Neither Agent nor any Lender
shall by any act, delay, omission or otherwise be deemed to have waived any of
its rights or remedies hereunder, and no waiver shall be valid unless in
writing, signed by Agent and then only to the extent therein set forth. A
waiver by Agent, for itself and the ratable benefit of Lenders, of any right or
remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which Agent would otherwise have had on any future occasion. No
failure to exercise nor any delay in exercising on the part of Agent or any
Lender, any right, power or privilege hereunder, shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, power or
privilege hereunder preclude any other or future exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies
hereunder provided are cumulative and may be exercised singly or concurrently,
and are not exclusive of any rights and remedies provided by law. None of the
terms or provisions of this Agreement may be waived, altered, modified or
amended except by an instrument in writing, duly executed by Agent and the
Lenders.
18. Severability. If for any reason any provision or provisions
hereof are determined to be invalid and contrary to any existing or future law,
such invalidity shall not impair the operation of or effect those portions of
this Agreement which are valid.
19. Notices. Except as otherwise provided herein, whenever it is
provided herein that any notice, demand, request, consent, approval, declaration
or other communication shall or may be given to or served upon any of the
parties by any other party, or whenever any of the parties desires to give and
serve upon any other party any communication with respect to this Agreement,
each such notice, demand, request, consent, approval, declaration or other
communication shall be in writing and shall be given in the manner, and deemed
received, as provided for in Section 11.10 of the Credit Agreement.
20. Section Titles. The Section titles contained in this Agreement
are and shall be without substantive meaning or content of any kind whatsoever
and are not a part of the agreement between the parties hereto.
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21. Counterparts. This Agreement may be executed in any number of
counterparts, which shall, collectively and separately, constitute one
agreement.
[signature page follows]
13
IN WITNESS WHEREOF, the parties hereto have caused this Pledge
Agreement to be duly executed as of the date first written above.
WILSONS THE LEATHER EXPERTS INC., as Pledgor
By:_____________________________
Name:___________________________
Title:__________________________
Accepted and Acknowledged by:
GENERAL ELECTRIC CAPITAL
CORPORATION, as Agent
By:_____________________________
Name:___________________________
Title:__________________________
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SCHEDULE I
----------
DESCRIPTION OF PLEDGED SHARES
-----------------------------
Attached to and forming a part of that certain Pledge Agreement by
Wilsons The Leather Experts Inc., as Pledgor, to General Electric Capital
Corporation, individually and as Agent for Lenders.
Name and Stock Minority
Address Class of Certificate Number of Shares
of Pledgor Stock Issuer Stock Number(s) Shares Outstanding
---------- ------------ ----- --------- ------ -----------
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SCHEDULE II
-----------
FORM OF PLEDGE AMENDMENT
------------------------
This Pledge Amendment, dated _______________ __, 19__ is delivered
pursuant to Section 6(d) of the Pledge Agreement referred to below. The
undersigned hereby agrees that this Pledge Amendment may be attached to that
certain Pledge Agreement, dated May 25, 1996 by the undersigned, as Pledgor, to
General Electric Capital Corporation, individually and as Agent for the Lenders,
and that the Pledged Shares listed on this Pledge Amendment shall be and become
a part of the Pledged Collateral referred to in said Pledge Agreement and shall
secure all Secured Obligations referred to in said Pledge Agreement.
WILSONS THE LEATHER EXPERTS INC.
By:_____________________________
Name:___________________________
Title:__________________________
Name and Class of Certificate Number of
Address of Pledgor Issuer Stock Number(s) Shares
------------------ ------ ----- --------- ------
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