EXHIBIT 2.9
PLEDGE AGREEMENT
PLEDGE AND SECURITY AGREEMENT, dated June 9, 2005, made by MITEL
NETWORKS LIMITED, a private company limited by shares incorporated under the
laws of England and Wales and having its registered office at Xxxxxxxxxxx,
Xxxxxxxxxxxxx, XX00 0XX (the "Pledgor"), in favor of HIGHBRIDGE INTERNATIONAL
LLC, a limited liability company formed under the laws of the Cayman Islands,
acting as collateral agent (in such capacity, the "Collateral Agent") pursuant
to the Collateral Agency Agreement dated April 27, 2005 (the "Collateral Agency
Agreement") for itself as a holder and the other holders (each a "Secured Party"
and collectively, the "Secured Parties") from time to time of senior secured
convertible notes initially issued on April 27, 2005 (as amended, restated or
supplemented from time to time the "Notes") by Mitel Networks Corporation, a
corporation incorporated under the laws of Canada (the "Issuer"), pursuant to a
Securities Purchase Agreement dated April 27, 2005 (the "Securities Purchase
Agreement") by and among the Issuer and the buyers party thereto.
WITNESSETH:
WHEREAS, the Pledgor is an indirect, wholly-owned subsidiary of the
Issuer;
WHEREAS, pursuant to the Securities Purchase Agreement, the Secured
Parties purchased the Notes on April 27, 2005;
WHEREAS, while it was to be a condition precedent to such purchase
of the Notes that the Pledgor have executed and delivered to the Collateral
Agent a pledge and security agreement providing for the pledge to the Collateral
Agent and the grant to the Collateral Agent, in each case for the benefit of the
Secured Parties, of a security interest in and Lien on 100% of the issued and
outstanding capital stock of Mitel Networks, Inc., a Delaware corporation
("Mitel Delaware"), the Secured Parties agreed to purchase the Notes without
prior satisfaction of such condition provided that the Issuer agreed in an
Undertaking dated April 27, 2005 to satisfy such condition within thirty (30)
Business Days after the purchase of the Notes; and
WHEREAS, the Pledgor determined, prior to the purchase of the Notes
by the Secured Parties, that such purchase and the execution, delivery and
performance of this Agreement benefit, and are in the best interests of, the
Issuer's group and therefore of the Pledgor;
NOW, THEREFORE, in consideration of the premises and the purchase by
the Secured Parties of the Notes pursuant to the Securities Purchase Agreement,
the Pledgor hereby agrees with the Collateral Agent as follows:
SECTION 1. Definitions. Defined terms used and not otherwise defined
herein have the meanings given them in the Guarantee and Security Agreement (the
"Guarantee and Security Agreement") dated April 27, 2005 between Mitel Delaware
and the Collateral Agent, or, if not defined therein, the meanings given them in
the Notes. All terms used in this Agreement which are defined in Article 8 or
Article 9 of the Uniform Commercial Code as in effect from time to time in the
State of New York (the "Code") and which are not otherwise defined herein shall
have the same meanings herein as set forth therein.
SECTION 2. Pledge and Grant of Security Interest. As collateral
security for all of the Liabilities, the Pledgor hereby pledges and assigns to
the Collateral Agent, and grants to the Collateral Agent, a continuing security
interest in, and Lien on, in each case for the benefit of the Secured Parties,
the Pledgor's right, title and interest in and to the following (collectively,
the "Pledged Collateral"):
(a) all issued and outstanding shares of capital stock of
Mitel Delaware (the "Pledged Shares"), whether or not evidenced or represented
by any stock certificate, certificated security or other instrument, the
certificates representing the Pledged Shares, all options and other rights,
contractual or otherwise, in respect thereof and all dividends, distributions,
cash, instruments, investment property and other property (including, but not
limited to, any stock dividend and any distribution in connection with a stock
split) from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the Pledged Shares; and
(b) all proceeds (including proceeds of proceeds) of any and
all of the foregoing.
in each case, whether now owned or hereafter acquired by the Pledgor and
howsoever its interest therein may arise or appear (whether by ownership,
security interest, Lien, claim or otherwise).
SECTION 3. Security for Liabilities. The security interest created
hereby in the Pledged Collateral constitutes continuing collateral security for
all of the Liabilities.
SECTION 4. Delivery of the Pledged Collateral.
(a) All certificates currently representing the Pledged Shares
shall be delivered to the Collateral Agent on or prior to the execution and
delivery of this Agreement. All other certificates and instruments constituting
Pledged Collateral from time to time required to be pledged to the Collateral
Agent pursuant to the terms of this Agreement shall be delivered to the
Collateral Agent promptly upon, but in any event within five (5) days of,
receipt thereof by or on behalf of the Pledgor. All such certificates and
instruments shall be held by or on behalf of the Collateral Agent pursuant
hereto and shall be delivered in suitable form for transfer by delivery or shall
be accompanied by undated stock powers executed in blank, all in form and
substance reasonably satisfactory to the Collateral Agent. If any Pledged
Collateral consists of uncertificated securities, unless the immediately
following sentence is applicable thereto, the Pledgor shall cause the Collateral
Agent (or its designated custodian or nominee) for the benefit of itself and the
Secured Parties to become the registered holder thereof, or, upon the request of
the Collateral Agent, cause each issuer of such securities to agree that it will
comply with
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instructions originated by the Collateral Agent with respect to such securities
without further consent by the Pledgor. If any Pledged Collateral consists of
security entitlements, the Pledgor shall transfer such security entitlements to
the Collateral Agent (or its custodian, nominee or other designee), or cause the
applicable securities intermediary to agree that it will comply with entitlement
orders by the Collateral Agent without further consent by the Pledgor.
(b) If the Pledgor shall receive, by virtue of the Pledgor's
being or having been an owner of any Pledged Collateral, any (i) stock
certificate (including, without limitation, any certificate representing a stock
dividend or distribution in connection with any increase or reduction of
capital, reclassification, merger, consolidation, sale of assets, combination of
shares, stock split, spin-off or split-off) or other instrument, (ii) option or
right, whether as an addition to, substitution for, or in exchange for, any
Pledged Collateral, or otherwise, (iii) dividends payable in cash (except such
dividends permitted to be retained by the Pledgor pursuant to Section 7 hereof)
or in securities or other property or (iv) dividends, distributions, cash,
instruments, investment property and other property in connection with a partial
or total liquidation or dissolution or in connection with a reduction of
capital, capital surplus or paid-in surplus, the Pledgor shall receive such
stock certificate, instrument, option, right, payment or distribution in trust
for the benefit of the Collateral Agent, shall segregate it from the Pledgor's
other property and shall deliver it forthwith to the Collateral Agent, in the
exact form received, with any necessary indorsement and/or appropriate stock
powers duly executed in blank, to be held by the Collateral Agent as Pledged
Collateral and as further collateral security for the Liabilities.
SECTION 5. Representations and Warranties. The Pledgor represents
and warrants as follows to the Collateral Agent and the Secured Parties:
(a) The Pledgor (i) is a private company limited by shares
duly incorporated, validly existing and in good standing under the laws of
England and Wales and (ii) has all requisite power and authority to execute,
deliver and perform this Agreement.
(b) The execution, delivery and performance by the Pledgor of
this Agreement (i) has been duly authorized by all necessary corporate action
and (ii) does not and will not contravene its organizational documents
(c) The execution, delivery and performance by the Pledgor of
this Agreement (i) does not and will not contravene any applicable law or any
contractual restriction binding on or affecting it or any of its properties,
(ii) does not and will not result in or require the creation of any Lien (other
than pursuant to this Agreement) upon or with respect to any of its properties
other than pursuant to this Agreement and (iii) does not and will not result in
any default, noncompliance, suspension, revocation, impairment, forfeiture or
nonrenewal of any permit, license, authorization or approval applicable to its
operations or any of its properties, except for such contraventions, Liens,
defaults, noncompliances, suspensions, revocations, impairments, forfeitures and
nonrenewals which would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect (as defined in the Securities
Purchase Agreement).
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(d) The Pledged Shares have been duly authorized and validly
issued and are fully paid and nonassessable and the holders thereof are not
entitled to any preemptive, first refusal or other similar rights. The Pledged
Shares constitute 100% of the issued and outstanding capital stock of Mitel
Delaware as of the date hereof.
(e) The Pledgor is and will be at all times the legal and
beneficial owner of the Pledged Collateral free and clear of all Liens, except
for the Lien created by this Agreement and except as otherwise provided in or
permitted by the Notes or the Securities Purchase Agreement.
(f) No authorization or approval or other action by, and no
notice to or filing with, any Governmental Authority is required to be obtained
or made by the Pledgor for (i) the due execution, delivery and performance by
the Pledgor of this Agreement, (ii) the grant by the Pledgor, or the perfection,
of the Lien created hereby in the Pledged Collateral or (iii) the exercise by
the Collateral Agent of any of its rights and remedies hereunder, except as may
be required in connection with any sale of any Pledged Collateral by laws
affecting the offering and sale of securities generally.
(g) This Agreement creates a valid Lien in favor of the
Collateral Agent, for the benefit of the Secured Parties, in the Pledged
Collateral as security for the Liabilities. All action necessary or desirable to
perfect and protect such Lien has been duly taken, except for the Collateral
Agent having possession of certificates, instruments and cash which become
Pledged Collateral after the date hereof.
(h) This Agreement has been duly executed and delivered by the
Pledgor and constitutes the legal valid and binding obligation of the Pledgor,
enforceable against the Pledgor in accordance with its terms, except as may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws and general principles of equity.
SECTION 6. Covenants as to the Pledged Collateral. Until the
Termination Date, the Pledgor will, except as otherwise provided in or permitted
by the Notes or the Securities Purchase Agreement or unless the Collateral Agent
shall otherwise consent in writing:
(a) keep adequate records concerning the Pledged Collateral
and permit the Collateral Agent or any other Secured Party or any agents,
designees or representatives thereof at any time or from time to time to examine
and make copies of and abstracts from such records;
(b) at the Pledgor's expense, promptly deliver to the
Collateral Agent and each other Secured Party a copy of each material notice or
other material communication received by it in respect of the Pledged
Collateral;
(c) at the Pledgor's expense, defend the Collateral Agent's
right, title and security interest in and to the Pledged Collateral against the
claims of any Person;
(d) at the Pledgor's expense, at any time and from time to
time, 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 reasonably request in order
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to (i) perfect and protect, or maintain the perfection of, the security interest
and Lien created hereby, (ii) enable the Collateral Agent to exercise and
enforce its rights and remedies hereunder in respect of the Pledged Collateral
or (iii) otherwise effect the purposes of this Agreement, including, without
limitation, delivering to the Collateral Agent irrevocable proxies in respect of
the Pledged Collateral;
(e) not sell, assign (by operation of law or otherwise),
exchange or otherwise dispose of any Pledged Collateral or any interest therein;
(f) not create or suffer to exist any Lien upon or with
respect to any Pledged Collateral, except for the Lien created hereby; and
(g) not permit the issuance of (i) any additional shares of
any class of Mitel Delaware, (ii) any securities convertible voluntarily by the
holder thereof or automatically upon the occurrence or non-occurrence of any
event or condition into, or exchangeable for, any such shares or (iii) any
warrants, options, contracts or other commitments entitling any Person to
purchase or otherwise acquire any such shares unless, in each case, such
issuance is made to the Pledgor and such items can be and are physically
delivered to the Collateral Agent at the time of issuance.
SECTION 7. Voting Rights, Dividends, Etc. in Respect of the Pledged
Collateral.
(a) So long as no Event of Default under the Notes shall have
occurred and be continuing:
(i) the Pledgor may exercise any and all voting and
other consensual rights pertaining to any Pledged Collateral for any purpose not
inconsistent with the terms of this Agreement, the Securities Purchase Agreement
and the Notes; provided, however, that (A) the Pledgor will not exercise or
refrain from exercising any such right, as the case may be, if the Collateral
Agent gives the Pledgor notice that, in the Collateral Agent's or Required
Holders' judgment, such action (or inaction) is reasonably likely to have a
material adverse effect on Mitel Delaware and (B) the Pledgor will give the
Collateral Agent and each other Secured Party at least fifteen (15) Business
Days' notice of the manner in which it intends to exercise, or the reasons for
refraining from exercising, any such right which is reasonably likely to have
such a material adverse effect;
(ii) the Pledgor may receive and retain any and all
dividends, interest or other distributions paid in respect of the Pledged
Collateral; provided, however, that any and all (A) dividends and interest 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 redemption or purchase of, or in exchange for, any Pledged Collateral, shall
be, and shall forthwith be delivered to the Collateral Agent, to hold as,
Pledged Collateral and shall, if received by the Pledgor, be received in trust
for the benefit of
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the Collateral Agent and the other Secured Parties, shall be segregated from the
other property or funds of the Pledgor, and shall be forthwith delivered to the
Collateral Agent in the exact form received with any necessary indorsement
and/or appropriate stock powers duly executed in blank, to be held by the
Collateral Agent as Pledged Collateral and as further collateral security for
the Liabilities; and
(iii) the Collateral Agent will execute and deliver (or
cause to be executed and delivered) to the Pledgor all such proxies and other
instruments as the Pledgor may reasonably request for the purpose of enabling
the Pledgor to exercise the voting and other rights which it is entitled to
exercise pursuant to Section 7(a)(i) hereof and to receive the dividends,
interest and/or other distributions which it is authorized to receive and retain
pursuant to Section 7(a)(ii) hereof.
(b) Upon the occurrence and during the continuance of an Event
of Default under the Notes:
(i) all rights of the Pledgor to exercise the voting and
other consensual rights which it would otherwise be entitled to exercise
pursuant to Section 7(a)(i) hereof, and to receive the dividends, distributions,
interest and other payments that it would otherwise be authorized to receive and
retain pursuant to Section 7(a)(ii) hereof, shall cease, and all such rights
shall thereupon become vested in the Collateral Agent, which shall, subject to
any rights of the Secured Parties, thereupon have the sole right to exercise
such voting and other consensual rights and to receive and hold as Pledged
Collateral such dividends, distributions, interest and other payments;
(ii) without limiting the generality of the foregoing,
the Collateral Agent may at its option exercise any and all rights of
conversion, exchange, subscription or any other rights, privileges or options
pertaining to any of the Pledged Collateral as if it were the absolute owner
thereof, including, without limitation, the right to exchange, in its
discretion, any and all of the Pledged Collateral upon the merger,
consolidation, reorganization, recapitalization or other adjustment of Mitel
Delaware, or upon the exercise by Mitel Delaware of any right, privilege or
option pertaining to any Pledged Collateral, and, in connection therewith, to
deposit and deliver any and all of the Pledged Collateral with any committee,
depository, transfer agent, registrar or other designated agent upon such terms
and conditions as it may determine; and
(iii) all dividends, distributions, interest and other
payments that are received by the Pledgor contrary to the provisions of Section
7(b)(i) hereof shall be received in trust for the benefit of the Collateral
Agent, shall be segregated from other funds of the Pledgor, and shall be
forthwith paid over to the Collateral Agent as Pledged Collateral in the exact
form received with any necessary indorsement and/or appropriate stock powers
duly executed in blank, to be held by the Collateral Agent as Pledged Collateral
and as further collateral security for the Liabilities.
Notwithstanding anything to the contrary contained herein, after all Events of
Default have been cured or waived, (x) all rights vested in the Collateral Agent
pursuant to Sections 7(b)(i) and (ii) hereof shall cease and the Pledgor will
have the right to exercise the voting and consensual rights
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and powers that it would otherwise be entitled to exercise pursuant to Section
7(a) hereof; and (y) the Collateral Agent shall, within five (5) Business Days
after all such Events of Default have been cured or waived, repay to the Pledgor
all cash dividends, interest or principal (in each case, without interest and
only to the extent not yet applied in accordance with Section 9 hereof), that
the Pledgor would otherwise be permitted to retain pursuant to the terms of
Section 7(a) hereof.
SECTION 8. Additional Provisions Concerning the Pledged Collateral.
(a) To the maximum extent permitted by applicable law, and for
the purpose of taking any action that the Collateral Agent may deem necessary or
advisable to accomplish the purposes of this Agreement, the Pledgor (i)
authorizes the Collateral Agent to execute any such agreements, instruments or
other documents in the Xxxxxxx'x name and to file such agreements, instruments
or other documents in the Xxxxxxx'x name and to file such agreements,
instruments, or other documents in any appropriate filing office, (ii)
authorizes the Collateral Agent to file any financing statements required
hereunder or under any other Credit Document, and any continuation statements or
amendment with respect thereto, in any appropriate filing office without the
signature of the Pledgor and (iii) ratifies the filing of any financing
statement, and any continuation statement or amendment with respect thereto,
filed without the signature of the Pledgor prior to the date hereof. A photocopy
or other reproduction of this Agreement or any financing statement covering the
Pledged Collateral or any part thereof shall be sufficient as a financing
statement where permitted by law.
(b) Effective only after an Event of Default, the Pledgor
hereby irrevocably appoints the Collateral Agent as the Pledgor's
attorney-in-fact and proxy, with full authority in the place and stead of the
Pledgor and in the name of the Pledgor or otherwise, from time to time in the
Collateral Agent's discretion, to take any action and to execute any instrument
that the Collateral Agent may deem necessary or advisable to accomplish the
purposes of this Agreement (subject to the rights of the Pledgor under Section
7(a) hereof), including, without limitation, to receive, indorse and collect all
instruments made payable to the Pledgor representing any dividend, interest
payment or other distribution in respect of any Pledged Collateral and to give
full discharge for the same. This power is coupled with an interest and is
irrevocable until the earlier date of (i) the date on which all of the
Liabilities have been indefeasibly paid in full in cash and (ii) the date on
which a Qualified IPO is consummated (such earlier date, the "Termination
Date").
(c) If the Pledgor fails to perform any agreement or
obligation contained herein, the Collateral Agent itself may perform, or cause
performance of, such agreement or obligation, and the expenses of the Collateral
Agent incurred in connection therewith shall be payable by the Pledgor pursuant
to Section 10 hereof and shall be secured by the Pledged Collateral.
(d) Other than the exercise of reasonable care to assure the
safe custody of the Pledged Collateral while held hereunder, the Collateral
Agent shall have no duty or liability to preserve rights pertaining thereto and
shall be relieved of all responsibility for the Pledged Collateral upon
surrendering it or tendering surrender of it to the Pledgor. The Collateral
Agent shall be deemed to have exercised reasonable care in the custody and
preservation of the Pledged Collateral in its possession if the Pledged
Collateral is accorded
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treatment substantially equal to that which the Collateral Agent accords its own
property, it being understood that the Collateral Agent shall not have
responsibility for (i) ascertaining or taking action with respect to calls,
conversions, exchanges, maturities, tenders or other matters relating to any
Pledged Collateral, whether or not the Collateral Agent or any Secured Party has
or is deemed to have knowledge of such matters, or (ii) taking any necessary
steps to preserve rights against any parties with respect to any Pledged
Collateral.
(e) The powers conferred on the Collateral Agent hereunder are
solely to protect its and the other Secured Parties' interest in the Pledged
Collateral and shall not impose any duty upon the Collateral Agent to exercise
any such powers. Except for the safe custody of any Pledged Collateral in its
possession and the accounting for monies actually received by it hereunder, the
Collateral Agent shall have no duty as to any Pledged Collateral or as to the
taking of any necessary steps to preserve rights against prior parties or any
other rights pertaining to any Pledged Collateral.
(f) The Collateral Agent may at any time in its discretion (i)
without notice to the Pledgor, transfer or register in the name of the
Collateral Agent or any of its nominees any or all of the Pledged Collateral,
subject to the rights of the Pledgor under Section 7(a) hereof, and (ii)
exchange certificates or instruments constituting Pledged Collateral for
certificates or instruments of smaller or larger denominations.
SECTION 9. Remedies Upon Default. If any Event of Default shall have
occurred and be continuing:
(a) The Collateral Agent may exercise in respect of the
Pledged Collateral, in addition to any other rights and remedies provided for
herein or otherwise available to it, all of the rights and remedies of a secured
party upon default under the Code; and without limiting the generality of the
foregoing and 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 elsewhere, at such price or prices and on
such other terms as the Collateral Agent may deem commercially reasonable. The
Pledgor agrees that, to the extent notice of sale shall be required by law, at
least ten (10) days' notice to the Pledgor of the time and place of any public
sale of Pledged Collateral owned by the Pledgor or the time after which any
private sale is to be made shall constitute reasonable notification. The
Collateral Agent shall not be obligated to make any sale of Pledged Collateral
regardless of whether or not notice of sale has been given. The Collateral Agent
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.
(b) In the event that the Collateral Agent determines to
exercise its right to sell all or any part of the Pledged Collateral pursuant to
Section 9(a) hereof, the Pledgor will, at the Pledgor's expense and upon request
by the Collateral Agent: (i) execute and deliver, and cause the issuer of such
Pledged Collateral and the directors and officers thereof to execute and
deliver, all such instruments and documents, and do or cause to be done all such
other acts and things, as may be necessary or, in the opinion of the Collateral
Agent, advisable to register such Pledged Collateral under the provisions of the
Securities Act of 1933, as amended (the "Securities Act"), and to cause the
registration statement relating thereto to become effective and to remain
effective
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for such period as prospectuses are required by law to be furnished, and to make
all amendments and supplements thereto and to the related prospectus which, in
the opinion of the Collateral Agent, are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules and
regulations of the Securities and Exchange Commission applicable thereto, (ii)
cause Mitel Delaware to qualify such Pledged Collateral under the state
securities or "Blue Sky" laws of each jurisdiction, and to obtain all necessary
governmental approvals for the sale of the Pledged Collateral, as requested by
the Collateral Agent, (iii) cause Mitel Delaware to make available to its
securityholders, as soon as practicable, an earnings statement which will
satisfy the provisions of Section 11(a) of the Securities Act, and (iv) do or
cause to be done all such other acts and things as may be necessary to make such
sale of such Pledged Collateral valid and binding and in compliance with
applicable law.
(c) Notwithstanding the provisions of Section 9(b) hereof, the
Pledgor recognizes that the Collateral Agent may deem it impracticable to effect
a public sale of all or any part of the Pledged Shares or any other securities
constituting Pledged Collateral and that the Collateral Agent may, therefore,
determine to make one or more private sales of any such securities to a
restricted group of purchasers who will be obligated to agree, among other
things, to acquire such securities for their own account, for investment and not
with a view to the distribution or resale thereof. The Pledgor acknowledges that
any such private sale may be at prices and on terms less favorable to the seller
than the prices and other terms which might have been obtained at a public sale
and, notwithstanding the foregoing, agrees that such private sales shall be
deemed to have been made in a commercially reasonable manner and that the
Collateral Agent shall have no obligation to delay the sale of any such
securities for the period of time necessary to permit the issuer of such
securities to register such securities for public sale under the Securities Act.
The Pledgor further acknowledges and agrees that any offer to sell such
securities which has been (i) publicly advertised on a bona fide basis in a
newspaper or other publication of general circulation in the financial community
of New York, New York (to the extent that such an offer may be so advertised
without prior registration under the Securities Act) or (ii) made privately in
the manner described above to not less than fifteen bona fide offerees shall be
deemed to involve a "public disposition" for the purposes of Section 9-610(c) of
the Code, notwithstanding that such sale may not constitute a "public offering"
under the Securities Act, and that the Collateral Agent may, in such event, bid
for the purchase of such securities.
(d) Any cash held by the Collateral Agent as Pledged
Collateral and all cash proceeds received by the Collateral Agent in respect of
any sale of, collection from, or other realization upon, all or any part of the
Pledged Collateral may, in the discretion of the Collateral Agent, be held by
the Collateral Agent as collateral for, and/or then or at any time thereafter
applied (after payment of any amounts payable to the Collateral Agent pursuant
to Section 10 hereof) in whole or in part by the Collateral Agent against, all
or any part of the Liabilities in accordance with the provisions of the
Collateral Agency Agreement. Any surplus of such cash or cash proceeds held by
the Collateral Agent and remaining after the Termination Date shall be paid over
to the Pledgor or to such Person as may be lawfully entitled to receive such
surplus.
(e) In the event that the proceeds of any such sale,
collection or realization are insufficient to pay all amounts to which the
Secured Parties are legally entitled, the Pledgor shall be liable for the
deficiency, together with interest thereon at the Interest Rate
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specified in the Notes for interest on overdue principal thereof or such other
rate as shall be fixed by applicable law, together with the costs of collection
and the reasonable fees, costs and expenses and other client charges of any
attorneys employed by the Collateral Agent or any Secured Party to collect such
deficiency.
SECTION 10. Indemnity and Expenses. The Pledgor agrees to pay on
demand all losses, costs, expenses (including, but not limited to, reasonable
attorneys' fees) and damages incurred by the Collateral Agent or any Secured
Party in connection with any amendment, waiver or consent with respect to this
Agreement, in enforcing or attempting to enforce this Agreement or in protecting
the Collateral Agent's or any Secured Party's rights under this Agreement
following any default by the Pledgor under this Agreement, whether the
Collateral Agent's or any Secured Party's rights are enforced by suit or
otherwise.
SECTION 11. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing and shall be mailed, telecopied or
delivered, if to the Pledgor, to it at its address specified on the first page
of this Agreement; if to the Collateral Agent, to it in c/o Highbridge Capital
Management, LLC, 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, XXX, Attention:
Xxx X. Xxxxxx/Xxxx X. Chill, Facsimile (000) 000-0000; or as to any such Person,
at such other address as shall be designated by such Person in a written notice
to such other Person complying as to delivery with the terms of this Section 11.
All such notices and other communications shall be effective (a) if mailed (by
certified mail, postage prepaid and return receipt requested), when received or
five (5) Business Days after deposited in the mails, whichever occurs first, (b)
if telecopied, when transmitted and confirmation received, provided same is on a
Business Day and, if not, on the next Business Day or (c) if delivered, upon
delivery, provided same is on a Business Day and, if not, on the next Business
Day.
SECTION 12. Security Interest Absolute. All rights of the Collateral
Agent, all Liens and all Liabilities hereunder shall be absolute and
unconditional irrespective of: (a) any lack of validity or enforceability of the
Notes or any other Credit Document, (b) any change in the time, manner or place
of payment of, or in any other term in respect of, all or any of the
Liabilities, or any other amendment or waiver of or consent to any departure
from the Notes or any Credit Document, (c) any exchange or release of, or
non-perfection of any Lien on any Pledged Collateral, or any release or
amendment or waiver of, or consent to or departure from any guaranty, for all or
any of the Liabilities, or (d) any other circumstance that might otherwise
constitute a defense available to, or a discharge of, the Pledgor in respect of
the Liabilities. All authorizations and agencies contained herein with respect
to any of the Pledged Collateral are irrevocable and powers coupled with an
interest.
SECTION 13. Miscellaneous.
(a) No amendment of any provision of this Agreement shall be
effective unless it is in writing and signed by the Pledgor and the Collateral
Agent, and no waiver of any provision of this Agreement, and no consent to any
departure by the Pledgor therefrom, shall be effective unless it is in writing
and signed by the Collateral Agent, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.
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(b) No failure on the part of the Collateral Agent or any
Secured Party to exercise, and no delay in exercising, any right hereunder or
under any other Credit Document shall operate as a waiver thereof; nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The rights and remedies of
the Collateral Agent and Secured Parties provided herein and in the other Credit
Documents are cumulative and are in addition to, and not exclusive of, any
rights or remedies provided by law. The rights of the Collateral Agent or
Holders under any Credit Document against any party thereto are not conditional
or contingent on any attempt by any such Person to exercise any of their rights
under any other document against such party or against any other Person.
(c) Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining portions hereof or thereof or affecting the validity or enforceability
of such provision in any other jurisdiction.
(d) This Agreement shall create a continuing security interest
in and Lien on the Pledged Collateral and shall (i) remain in full force and
effect until the Termination Date and (ii) be binding on the Pledgor and its
successors and assigns, and shall inure, together with all rights and remedies
of the Collateral Agent hereunder, to the benefit of the Collateral Agent, each
Secured Party and their successors, transferees and assigns. None of the rights
or Liabilities of the Xxxxxxx hereunder may be assigned or otherwise transferred
without the prior written consent of the Collateral Agent, and any such
assignment or transfer shall be null and void. The Collateral Agent may resign
as such in the manner and with the effect specified in the Collateral Agency
Agreement.
(e) Upon the Termination Date, (i) this Agreement and the
security interest and Lien created hereby shall terminate and all rights to the
Pledged Collateral shall revert to the Pledgor, and (ii) the Collateral Agent
will, upon the Pledgor's request and at the Pledgor's expense, without any
representation, warranty or recourse whatsoever, (A) return to the Pledgor such
of the Pledged Collateral as shall not have been sold or otherwise disposed of
or applied pursuant to the terms hereof and (B) execute and deliver to the
Pledgor such documents as the Pledgor shall reasonably request to evidence such
termination.
(f) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, EXCEPT AS REQUIRED BY
MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT THE VALIDITY AND
PERFECTION OR THE PERFECTION AND THE EFFECT OF PERFECTION OR NON-PERFECTION OF
THE SECURITY INTEREST AND LIEN CREATED HEREBY, OR REMEDIES HEREUNDER, IN RESPECT
OF ANY PARTICULAR PLEDGED COLLATERAL ARE GOVERNED BY THE LAW OF A JURISDICTION
OTHER THAN THE STATE OF NEW YORK.
(g) Section headings herein are included for convenience of
reference only and shall not constitute a part of this Agreement for any other
purpose.
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(h) This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which shall be deemed an original, but all such counterparts shall constitute
one and the same agreement. Delivery of an executed counterpart of this
Agreement by facsimile or electronic mail shall be equally effective as delivery
of an original executed counterpart.
SECTION 14. Jurisdiction; Jury Trial. Each party hereby irrevocably
submits to the non-exclusive jurisdiction of the New York State courts or
Federal courts sitting in the Borough of Manhattan, State of New York, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is improper. Each party hereby irrevocably
waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party at the
address for such notices to it under this Agreement and agrees that such service
shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT
OR ANY TRANSACTION CONTEMPLATED HEREBY.
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IN WITNESS WHEREOF, the Pledgor has caused this Agreement to be
executed and delivered by its signatories thereunto duly authorized, as of the
date first above written.
PLEDGOR:
MITEL NETWORKS LIMITED
By: /s/ Xxxx Xxxxxxx
-----------------------
Director
/s/ [ILLEGIBLE]
-----------------------
Director
ACKNOWLEDGED AND ACCEPTED
HIGHBRIDGE INTERNATIONAL LLC
By: Highbridge Capital Management, LLC
By: ____________________________________________
Name: Xxxx X. Chill
Title: Managing Director
IN WITNESS WHEREOF, the Pledgor has caused this Agreement to be
executed and delivered by its signatories thereunto duly authorized, as of the
date first above written.
PLEDGOR:
MITEL NETWORKS LIMITED
By: _________________________________
Director
_________________________________
Director/Secretary
ACKNOWLEDGED AND ACCEPTED
HIGHBRIDGE INTERNATIONAL LLC
By: Highbridge Capital Management, LLC
By: /s/ Xxxx X. Chill
--------------------
Name: Xxxx X. Chill
Title: Managing Director
