EXHIBIT 10.20
HOLDINGS PLEDGE AGREEMENT
THIS HOLDINGS PLEDGE AGREEMENT, dated as of October 26, 2001 (this "PLEDGE
AGREEMENT") is made by MSN Holdings, Inc., a Delaware corporation (the
"PLEDGOR") and Bank of America, N.A., in its capacity as collateral agent (in
such capacity, the "COLLATERAL AGENT") for the lenders from time to time party
to the Credit Agreement described below (the "LENDERS").
RECITALS
WHEREAS, pursuant to that certain Credit Agreement, dated as of the date
hereof (as amended, modified, extended, renewed or replaced from time to time,
the "CREDIT AGREEMENT"), among Medical Staffing Network, Inc., a Delaware
corporation (the "BORROWER"), Medical Staffing Holdings, LLC, a Delaware limited
liability company (the "PARENT"), the Domestic Subsidiaries of the Borrower, the
Lenders and Bank of America, N.A., in its capacity as administrative agent (the
"Administrative Agent"), the Lenders have agreed to make Loans and issue Letters
of Credit to the Borrower upon the terms and subject to the conditions set forth
therein; and
WHEREAS, it is a condition precedent to the effectiveness of the Credit
Agreement and the obligations of the Lenders to make their respective Loans and
to issue Letters of Credit under the Credit Agreement that the Pledgor shall
have executed and delivered this Pledge Agreement to the Collateral Agent for
the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. DEFINITIONS. Capitalized terms used herein but not otherwise defined
shall have the meanings ascribed to such terms in the Credit Agreement and the
following terms which are defined in the Uniform Commercial Code (the "UCC") in
effect in the State of New York on the date hereof are used herein as so
defined: Control, Entitlement Order, Securities Account, Securities Entitlement,
and Securities Intermediary. For purposes of this Pledge Agreement, the term
"Lender" shall include any Affiliate of any Lender which has entered into a
Hedging Agreement with any Credit Party (to the extent the obligations of such
Credit Party thereunder constitute Credit Party Obligations).
2. PLEDGE AND GRANT OF SECURITY INTEREST. To secure the prompt payment and
performance in full when due, whether by lapse of time or otherwise, of the
Pledgor Obligations (as defined in Section 3 hereof), the Pledgor hereby pledges
and assigns to the Collateral Agent, for the benefit of the Lenders, and grants
to the Collateral Agent, for the benefit of the Lenders, a continuing security
interest in, and a right to set off against, any and all right, title and
interest of the Pledgor in and to the following, whether now owned or existing
or owned, acquired, or arising hereafter (collectively, the "PLEDGED
COLLATERAL"):
(a) CAPITAL STOCK. One hundred percent (100%) of the issued and
outstanding Capital Stock of the Parent, together with the certificates
(or other agreements or instruments), if any, representing such Capital
Stock and all options and other rights, contractual or otherwise, with
respect thereto (collectively, together with the Capital Stock described
in Sections 2(b) below, the "PLEDGED CAPITAL STOCK"), including, but not
limited to, the following:
(A) all shares, securities, membership interests or other
equity interests representing a dividend on any of the Pledged
Capital Stock, or representing a distribution or return of capital
upon or in respect of the Pledged Capital Stock, or resulting from a
stock split, revision, reclassification or other exchange therefor,
and any
subscriptions, warrants, rights or options issued to the holder of,
or otherwise in respect of, the Pledged Capital Stock; and
(B) without affecting the obligations of the Pledgor under any
provision prohibiting such action hereunder or under the Credit
Agreement, in the event of any consolidation or merger involving the
issuer of any Pledged Capital Stock and in which such issuer is not
the surviving entity, the Capital Stock (in the applicable
percentage specified in Section 2(a) above) of the successor entity
formed by or resulting from such consolidation or merger.
(b) PROCEEDS. All proceeds and products of the foregoing, however
and whenever acquired and in whatever form.
Without limiting the generality of the foregoing, it is hereby
specifically understood and agreed that the Pledgor may from time to time
hereafter deliver additional shares of Capital Stock to the Collateral Agent as
collateral security for the Pledgor Obligations. Upon delivery to the Collateral
Agent, such additional Capital Stock shall be deemed to be part of the Pledged
Collateral and shall be subject to the terms of this Pledge Agreement whether or
not SCHEDULE 2(A) is amended to refer to such additional Capital Stock.
3. SECURITY FOR PLEDGOR OBLIGATIONS. The security interest created hereby
in the Pledged Collateral constitutes continuing collateral security for all of
the following, whether now existing or hereafter incurred (the "PLEDGOR
OBLIGATIONS"):
(a) In the case of the Borrower, the prompt performance and
observance by the Borrower of all obligations of the Borrower under the
Credit Agreement, the Notes, this Pledge Agreement and the other Credit
Documents to which the Borrower is a party;
(b) In the case of the Guarantors, the prompt performance and
observance by each Guarantor of all obligations of such Guarantor under
the Credit Agreement, this Pledge Agreement and the other Credit Documents
to which such Guarantor is a party, including, without limitation, its
guaranty obligations arising under SECTION 4 of the Credit Agreement; and
(c) All other indebtedness, liabilities, obligations and expenses of
any kind or nature owing from any Credit Party to any Lender, the
Administrative Agent or the Collateral Agent in connection with (i) this
Pledge Agreement or any other Credit Document, whether now existing or
hereafter arising, due or to become due, direct or indirect, absolute or
contingent, and howsoever evidenced, held or acquired, together with any
and all modifications, extensions, renewals and/or substitutions of any of
the foregoing, (ii) collecting and enforcing the Credit Party Obligations
and (iii) if and to the extent agreed to by such Credit Party in the
documentation evidencing the same, all liabilities and obligations owing
from such Credit Party to any Lender or any Affiliate of any Lender
arising under any Hedging Agreements relating to the Loans.
4. DELIVERY OF THE PLEDGED COLLATERAL; PERFECTION OF SECURITY INTEREST.
The Pledgor hereby agrees that:
(a) DELIVERY OF CERTIFICATES. The Pledgor shall deliver to the
Collateral Agent (i) simultaneously with or prior to the execution and
delivery of this Pledge Agreement, all certificates representing the
Pledged Capital Stock and (ii) promptly upon the receipt thereof by or on
behalf of the Pledgor, all other certificates and instruments constituting
Pledged Collateral.
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Prior to delivery to the Collateral Agent, all such certificates and
instruments constituting Pledged Collateral shall be held in trust by the
Pledgor for the benefit of the Collateral Agent pursuant hereto. All such
certificates shall be delivered in suitable form for transfer by delivery
or shall be accompanied by duly executed instruments of transfer or
assignment in blank, substantially in the form provided in EXHIBIT 4(a)
attached hereto.
(b) ADDITIONAL SECURITIES. If the Pledgor shall receive by virtue of
its being, becoming or having been the owner of any Pledged Collateral,
any (i) certificate, including without limitation, any certificate
representing a dividend or distribution in connection with any increase or
reduction of capital, reclassification, merger, consolidation, sale of
assets, combination of shares or membership or equity interests, stock
splits, spin-off or split-off, promissory notes or other instrument; (ii)
option or right, whether as an addition to, substitution for, or an
exchange for, any Pledged Collateral or otherwise; (iii) dividends payable
in securities; or (iv) distributions of securities or other equity
interests in connection with a partial or total liquidation, dissolution
or reduction of capital, capital surplus or paid-in surplus, then, subject
to the percentage limitations set forth in Section 2(a) above, the Pledgor
shall receive such certificate, instrument, option, right 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 together with any necessary
endorsement and/or appropriate stock power duly executed in blank,
substantially in the form provided in EXHIBIT 4(a), to be held by the
Collateral Agent as Pledged Collateral and as further collateral security
for the Pledgor Obligations.
(c) FINANCING STATEMENTS. The Pledgor shall execute and deliver to
the Collateral Agent such UCC or other applicable financing statements as
may be reasonably requested by the Collateral Agent in order to perfect
and protect the security interest created hereby in the Pledged
Collateral.
(d) PROVISIONS RELATING TO SECURITIES ENTITLEMENTS AND SECURITIES
ACCOUNTS. With respect to any Pledged Collateral consisting of a
Securities Entitlement or held in a Securities Account, (a) the Pledgor
shall (i) promptly give written notice to the Collateral Agent thereof and
(ii) upon request of the Collateral Agent, the Pledgor and the applicable
Securities Intermediary shall, within thirty (30) days after such request,
enter into an agreement with the Collateral Agent granting Control to the
Collateral Agent over such Pledged Collateral, such agreement to be in
form and substance satisfactory to the Collateral Agent and (b) the
Collateral Agent shall be entitled, upon the occurrence and during the
continuance of a Default or an Event of Default, to notify the applicable
Securities Intermediary that it should follow the Entitlement Orders of
the Collateral Agent and no longer follow the Entitlement Orders of the
Pledgor. Upon receipt by the Pledgor of notice from a Securities
Intermediary of its intent to terminate the Securities Account of the
Pledgor held by such Securities Intermediary, prior to the termination of
such Securities Account the Pledged Collateral in such Securities Account
shall be (i) transferred to a new Securities Account which is subject to a
control agreement as provided above or (ii) transferred to an account held
by the Collateral Agent (in which it will be held until a new Securities
Account is established).
5. REPRESENTATIONS AND WARRANTIES. The Pledgor hereby represents and
warrants to the Collateral Agent, for the benefit of the Lenders, that so long
as any of the Pledgor Obligations remain outstanding (other than any such
obligations which by the terms thereof are stated to survive termination of the
Credit Documents) or any Credit Document or Hedging Agreement between any Credit
Party and any Lender (to the extent the obligations of such Credit Party
thereunder constitute Credit Party Obligations) is in effect, and until all of
the Commitments shall have been terminated:
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(a) AUTHORIZATION OF PLEDGED CAPITAL STOCK. The Pledged Capital
Stock is duly authorized and validly issued, is fully paid and, with
respect any Pledged Capital Stock consisting of stock of a corporation,
nonassessable and is not subject to the preemptive rights of any Person.
All other shares of Capital Stock constituting Pledged Collateral will be
duly authorized and validly issued, fully paid and, with respect any
Pledged Capital Stock consisting of stock of a corporation, nonassessable
and not subject to the preemptive rights of any Person.
(b) TITLE. The Pledgor has good and indefeasible title to the
Pledged Collateral and will at all times be the legal and beneficial owner
of such Pledged Collateral free and clear of any Lien, other than
Permitted Liens. There exists no "adverse claim" within the meaning of
Section 8-102 of the Uniform Commercial Code as in effect in the State of
New York (the "UCC") with respect to the Pledged Capital Stock.
(c) EXERCISING OF RIGHTS. The exercise by the Collateral Agent of
its rights and remedies hereunder will not violate any law or governmental
regulation or any material contractual restriction binding on or affecting
the Pledgor or any of its property.
(d) PLEDGOR'S AUTHORITY. No authorization, approval or action by,
and no notice or filing with any Governmental Authority or with the issuer
of any Pledged Capital Stock is required either (i) for the pledge made by
the Pledgor or for the granting of the security interest by the Pledgor
pursuant to this Pledge Agreement or (ii) for the exercise by the
Collateral Agent or the Lenders of their rights and remedies hereunder
(except as may be required by laws affecting the offering and sale of
securities).
(e) SECURITY INTEREST/PRIORITY. This Pledge Agreement creates a
valid security interest in favor of the Collateral Agent, for the benefit
of the Lenders, in the Pledged Collateral. The taking possession by the
Collateral Agent of the certificates, if any, representing the Pledged
Capital Stock and all other certificates and instruments constituting
Pledged Collateral will perfect and establish the first priority of the
Collateral Agent's security interest in all certificated Pledged Capital
Stock and such certificates and instruments and, upon the filing of UCC
financing statements in the appropriate filing office in the location of
the Pledgor's state of formation, the Collateral Agent shall have a first
priority perfected security interest in all uncertificated Pledged Capital
Stock consisting of partnership or limited liability company interests
that do not constitute a security pursuant to Section 8-103(c) of the UCC.
With respect to any Pledged Collateral consisting of a Securities
Entitlement or held in a Securities Account, upon execution and delivery
by the Pledgor, the applicable Securities Intermediary and the Collateral
Agent of an agreement granting Control to the Collateral Agent over such
Pledged Collateral, the Collateral Agent shall have a first priority
perfected security interest in such Pledged Collateral. Except as set
forth in this Section 5(e), no action is necessary to perfect or otherwise
protect such security interest.
(f) NO OTHER CAPITAL STOCK. The issued and outstanding Capital Stock
of the Parent is set forth on SCHEDULE 2(a) attached hereto
(g) PARTNERSHIP AND LIMITED LIABILITY COMPANY INTERESTS. Except as
previously disclosed to the Collateral Agent, none of the Pledged Capital
Stock consisting of partnership or limited liability company interests (i)
is dealt in or traded on a securities exchange or in a securities market,
(ii) by its terms expressly provides that it is a security governed by
Article 8 of the UCC, (iii) is an investment company security, (iv) is
held in a securities account or (v) constitutes a "security" or a
"financial asset" as such terms are defined in Article 8 of the UCC.
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6. COVENANTS. The Pledgor hereby covenants, that so long as any of the
Pledgor Obligations remain outstanding (other than any such obligations which by
the terms thereof are stated to survive termination of the Credit Documents) or
any Credit Document or Hedging Agreement between any Credit Party and any Lender
(to the extent the obligations of such Credit Party thereunder constitute Credit
Party Obligations) is in effect, and until all of the Commitments shall have
been terminated, the Pledgor shall:
(a) BOOKS AND RECORDS. Xxxx its books and records (and shall cause
the issuer of the Pledged Capital Stock to xxxx its books and records) to
reflect the security interest granted to the Collateral Agent, for the
benefit of the Lenders, pursuant to this Pledge Agreement.
(b) DEFENSE OF TITLE. Warrant and defend title to and ownership of
the Pledged Collateral at its own expense against the claims and demands
of all other parties claiming an interest therein, keep the Pledged
Collateral free from all Liens, except for Permitted Liens, and not sell,
exchange, transfer, assign, lease or otherwise dispose of Pledged
Collateral or any interest therein, except as permitted under the Credit
Agreement and the other Credit Documents.
(c) FURTHER ASSURANCES. Promptly execute and deliver at its expense
all further instruments and documents and take all further action that may
be necessary and desirable or that the Collateral Agent may reasonably
request in order to (i) perfect and protect the security interest created
hereby in the Pledged Collateral (including, without limitation, the
execution and filing of UCC financing statements and any and all action
necessary to satisfy the Collateral Agent that the Collateral Agent has
obtained a first priority perfected security interest in all Pledged
Capital Stock); (ii) enable the Collateral Agent to exercise and enforce
its rights and remedies hereunder in respect of the Pledged Collateral;
and (iii) otherwise effect the purposes of this Pledge Agreement,
including, without limitation and if requested by the Collateral Agent,
delivering to the Collateral Agent irrevocable proxies in respect of the
Pledged Collateral.
(d) AMENDMENTS. Not make or consent to any amendment or other
modification or waiver with respect to any of the Pledged Collateral or
enter into any agreement or allow to exist any restriction with respect to
any of the Pledged Collateral other than pursuant hereto or as may be
permitted under the Credit Agreement.
(e) COMPLIANCE WITH SECURITIES LAWS. File all reports and other
information now or hereafter required to be filed by the Pledgor with the
United States Securities and Exchange Commission and any other state,
federal or foreign agency in connection with the ownership of the Pledged
Collateral.
(f) ISSUANCE OR ACQUISITION OF CAPITAL STOCK. Not, without providing
30 days prior written notice to the Collateral Agent and without executing
and delivering, or causing to be executed and delivered, to the Collateral
Agent such agreements, documents and instruments as the Collateral Agent
may require, issue or acquire any Capital Stock consisting of an interest
in a partnership or a limited liability company that (i) is dealt in or
traded on a securities exchange or in a securities market, (ii) by its
terms expressly provides that it is a security governed by Article 8 of
the UCC, (iii) is an investment company security, (iv) is held in a
securities account or (v) constitutes a "security" or a "financial asset"
as such terms are defined in Article 8 of the UCC.
7. PERFORMANCE OF OBLIGATIONS AND ADVANCES BY COLLATERAL AGENT OR LENDERS.
On failure of the Pledgor to perform any of the covenants and agreements
contained herein, the Collateral Agent or any of the Lenders may, at its sole
option and in its reasonable discretion, perform or cause to be performed the
same and in so doing may expend such sums as the Collateral Agent or such Lender
may reasonably deem
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advisable in the performance thereof, including, without limitation, the payment
of any insurance premiums, the payment of any taxes, a payment to obtain a
release of a Lien or potential Lien, expenditures made in defending against any
adverse claim and all other expenditures which the Collateral Agent or such
Lender may make for the protection of the security hereof or which may be
compelled to make by operation of law. All such sums and amounts so expended
shall be repayable by the Pledgor promptly upon timely notice thereof and demand
therefor, shall constitute additional Pledgor Obligations and shall bear
interest from the date said amounts are expended at the default rate specified
in SECTION 3.1 of the Credit Agreement for Revolving Loans that are Base Rate
Loans. No such performance of any covenant or agreement by the Collateral Agent
or the Lenders on behalf of the Pledgor, and no such advance or expenditure
therefor, shall relieve the Pledgor of any default under the terms of this
Pledge Agreement, the other Credit Documents or any Hedging Agreement between
any Credit Party and any Lender (to the extent the obligations of such Credit
Party thereunder constitute Credit Party Obligations). The Collateral Agent or
any Lender may make any payment hereby authorized in accordance with any xxxx,
statement or estimate procured from the appropriate public office or holder of
the claim to be discharged without inquiry into the accuracy of such xxxx,
statement or estimate or into the validity of any tax assessment, sale,
forfeiture, tax lien, title or claim except to the extent such payment is being
contested in good faith by the Pledgor in appropriate proceedings and against
which adequate reserves are being maintained in accordance with GAAP.
8. EVENTS OF DEFAULT. The occurrence of an event which under the Credit
Agreement would constitute an Event of Default shall be an event of default
hereunder (an "EVENT OF DEFAULT").
9. REMEDIES.
(a) GENERAL REMEDIES. Upon the occurrence of an Event of Default and
during the continuation thereof, the Collateral Agent and the Lenders
shall have, in respect of the Pledged Collateral, in addition to the
rights and remedies provided herein, in the Credit Documents, in any
Hedging Agreement between any Credit Party and any Lender (to the extent
the obligations of such Credit Party thereunder constitute Credit Party
Obligations) or by law, the rights and remedies of a secured party under
the UCC or any other applicable law.
(b) SALE OF PLEDGED COLLATERAL. Upon the occurrence of an Event of
Default and during the continuation thereof, without limiting the
generality of this Section and without notice, the Collateral Agent may,
in its sole discretion, sell or otherwise dispose of or realize upon 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, for cash, credit or for future delivery or
otherwise in accordance with applicable law. To the extent permitted by
law, any Lender may in such event bid for the purchase of such securities.
The Pledgor agrees that, to the extent notice of sale shall be required by
law and has not been waived by the Pledgor, any requirement of reasonable
notice shall be met if notice, specifying the place of any public sale or
the time after which any private sale is to be made, is personally served
on or mailed postage prepaid to the Pledgor in accordance with the notice
provisions of SECTION 11.1 of the Credit Agreement at least 10 days before
the time of such sale. The Collateral Agent shall not be obligated to make
any sale of Pledged Collateral regardless of notice of sale having 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.
(c) PRIVATE SALE. Upon the occurrence of an Event of Default and
during the continuation thereof, the Pledgor recognizes that the
Collateral Agent may deem it impracticable to effect a public sale of all
or any part of the Pledged Collateral and that the Collateral Agent
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may, therefore, determine to make one or more private sales of any such
Pledged Collateral to a restricted group of purchasers who will be
obligated to agree, among other things, to acquire such Pledged Collateral
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 sale
shall be deemed to have been made in a commercially reasonable manner and
that the Collateral Agent shall have no obligation to delay sale of any
such Pledged Collateral for the period of time necessary to permit the
issuer of such Pledged Collateral to register such Pledged Collateral for
public sale under the Securities Act of 1933. The Pledgor further
acknowledges and agrees that any offer to sell such Pledged Collateral
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 offer may be advertised
without prior registration under the Securities Act of 1933), or (ii) made
privately in the manner described above shall be deemed to involve a
"public sale" under the UCC, notwithstanding that such sale may not
constitute a "public offering" under the Securities Act of 1933, and the
Collateral Agent may, in such event, bid for the purchase of such Pledged
Collateral.
(d) RETENTION OF PLEDGED COLLATERAL. In addition to the rights and
remedies hereunder, upon the occurrence of an Event of Default, the
Collateral Agent may, after providing the notices required by Section
9-505(2) of the UCC (or any successor sections of the UCC) or otherwise
complying with the requirements of applicable law of the relevant
jurisdiction, retain all or any portion of the Pledged Collateral in
satisfaction of the Pledgor Obligations. Unless and until the Collateral
Agent shall have provided such notices, however, the Collateral Agent
shall not be deemed to have retained any Pledged Collateral in
satisfaction of the Pledgor Obligations for any reason.
(e) DEFICIENCY. In the event that the proceeds of any sale,
collection or realization are insufficient to pay all amounts to which the
Collateral Agent or the Lenders are legally entitled, the Pledgor shall be
liable for the deficiency, together with interest thereon at the default
rate specified in SECTION 3.1 of the Credit Agreement for Revolving Loans
that are Base Rate Loans and together with the costs of collection and the
reasonable fees of any attorneys employed by the Collateral Agent to
collect such deficiency. Any surplus remaining after the full payment and
satisfaction of the Pledgor Obligations shall be returned to the Pledgor
or to whomsoever a court of competent jurisdiction shall determine to be
entitled thereto.
10. RIGHTS OF THE COLLATERAL AGENT.
(a) POWER OF ATTORNEY. In addition to other powers of attorney
contained herein, the Pledgor hereby designates and appoints the
Collateral Agent, on behalf of the Lenders, and each of its designees or
agents as attorney-in-fact of the Pledgor, irrevocably and with power of
substitution, with authority to take any or all of the following actions
upon the occurrence and during the continuance of an Event of Default:
(i) to demand, collect, settle, compromise, adjust and
give discharges and releases concerning the Pledged Collateral, all
as the Collateral Agent may reasonably determine;
(ii) to commence and prosecute any actions at any court
for the purposes of collecting any of the Pledged Collateral and
enforcing any other right in respect thereof;
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(iii) to defend, settle, adjust or compromise any
action, suit or proceeding brought and, in connection therewith,
give such discharge or release as the Collateral Agent may deem
reasonably appropriate;
(iv) to pay or discharge taxes, liens, security
interests, or other encumbrances levied or placed on or threatened
against the Pledged Collateral;
(v) to direct any parties liable for any payment under
any of the Pledged Collateral to make payment of any and all monies
due and to become due thereunder directly to the Collateral Agent or
as the Collateral Agent shall direct;
(vi) to receive payment of and receipt for any and all
monies, claims, and other amounts due and to become due at any time
in respect of or arising out of any Pledged Collateral;
(vii) to sign and endorse any drafts, assignments,
proxies, stock powers, verifications, notices and other documents
relating to the Pledged Collateral;
(viii) to execute and deliver all assignments,
conveyances, statements, financing statements, renewal financing
statements, pledge agreements, affidavits, notices and other
agreements, instruments and documents that the Collateral Agent may
determine necessary in order to perfect and maintain the security
interests and liens granted in this Pledge Agreement and in order to
fully consummate all of the transactions contemplated herein;
(ix) to exchange any of the Pledged Collateral or other
property upon any merger, consolidation, reorganization,
recapitalization or other readjustment of the issuer thereof and, in
connection therewith, deposit any of the Pledged Collateral with any
committee, depository, transfer agent, registrar or other designated
agency upon such terms as the Collateral Agent may determine;
(x) to vote for a shareholder or member resolution, or
to sign an instrument in writing, sanctioning the transfer of any or
all of the Pledged Capital Stock into the name of the Collateral
Agent or one or more of the Lenders or into the name of any
transferee to whom the Pledged Capital Stock or any part thereof may
be sold pursuant to Section 9 hereof; and
(xi) to do and perform all such other acts and things as
the Collateral Agent may reasonably deem to be necessary, proper or
convenient in connection with the Pledged Collateral.
This power of attorney is a power coupled with an interest and shall be
irrevocable (i) for so long as any of the Pledgor Obligations remain
outstanding (other than any such obligations which by the terms thereof
are stated to survive termination of the Credit Documents) or any Credit
Document or any Hedging Agreement between any Credit Party and any Lender
(to the extent the obligations of such Credit Party thereunder constitute
Credit Party Obligations) is in effect and (ii) until all of the
Commitments shall have been terminated. The Collateral Agent shall be
under no duty to exercise or withhold the exercise of any of the rights,
powers, privileges and options expressly or implicitly granted to the
Collateral Agent in this Pledge Agreement and shall not be liable for any
failure to do so or any delay in doing so. The Collateral Agent shall not
be liable
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for any act or omission or for any error of judgment or any mistake of
fact or law in its individual capacity or its capacity as attorney-in-fact
except acts or omissions resulting from its gross negligence or willful
misconduct. This power of attorney is conferred on the Collateral Agent
solely to protect, preserve and realize upon its security interest in the
Pledged Collateral.
(b) ASSIGNMENT BY THE COLLATERAL AGENT. The Collateral Agent may
from time to time assign the Pledgor Obligations and any portion thereof
and/or the Pledged Collateral and any portion thereof, and the assignee
shall be entitled to all of the rights and remedies of the Collateral
Agent under this Pledge Agreement in relation thereto.
(c) THE COLLATERAL AGENT'S DUTY OF CARE. Other than the exercise of
reasonable care to ensure the safe custody of the Pledged Collateral while
being held by the Collateral Agent hereunder, the Collateral Agent shall
have no duty or liability to preserve rights pertaining thereto, it being
understood and agreed that the Pledgor shall be responsible for
preservation of all rights in the Pledged Collateral, and the Collateral
Agent shall be relieved of all responsibility for such Pledged Collateral
upon surrendering it or tendering the 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
such Pledged Collateral is accorded treatment substantially equal to that
which the Collateral Agent accords its own property, which shall be no
less than the treatment employed by a reasonable and prudent agent in the
industry, 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
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.
(d) VOTING RIGHTS IN RESPECT OF THE PLEDGED COLLATERAL.
(i) So long as no Event of Default shall have occurred
and be continuing, to the extent permitted by law, the Pledgor may
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 Pledge Agreement or the Credit
Agreement; and
(ii) Upon the occurrence and during the continuance of
an Event of Default, all rights of the Pledgor to exercise the
voting and other consensual rights which it would otherwise be
entitled to exercise pursuant to paragraph (i) of this Section shall
cease and all such rights shall thereupon become vested in the
Collateral Agent which shall then have the sole right to exercise
such voting and other consensual rights.
(f) DIVIDEND AND DISTRIBUTION RIGHTS IN RESPECT OF THE PLEDGED
COLLATERAL.
(i) So long as no Event of Default shall have occurred
and be continuing and subject to Section 4(b) hereof, the Pledgor
may receive and retain any and all dividends (other than stock
dividends and other dividends constituting Pledged Collateral which
are addressed hereinabove), distributions or interest paid in
respect of the Pledged Collateral to the extent they are allowed
under the Credit Agreement.
(ii) Upon the occurrence and during the continuance of
an Event of Default:
9
(A) all rights of the Pledgor to receive the dividends,
distributions and interest payments which it would otherwise
be authorized to receive and retain pursuant to subsection (i)
of this Section shall cease and all such rights shall
thereupon be vested in the Collateral Agent which shall then
have the sole right to receive and hold as Pledged Collateral
such dividends, distributions and interest payments; and
(B) all dividends, distributions and interest payments
which are received by the Pledgor contrary to the provisions
of subsection (A) of this Section shall be received in trust
for the benefit of the Collateral Agent, shall be segregated
from other property or funds of the Pledgor, and shall be
forthwith paid over to the Collateral Agent as Pledged
Collateral in the exact form received, to be held by the
Collateral Agent as Pledged Collateral and as further
collateral security for the Pledgor Obligations.
(g) RELEASE OF PLEDGED COLLATERAL. The Collateral Agent may release
any of the Pledged Collateral from this Pledge Agreement or may substitute
any of the Pledged Collateral for other Pledged Collateral without
altering, varying or diminishing in any way the force, effect, lien,
pledge or security interest of this Pledge Agreement as to any Pledged
Collateral not expressly released or substituted, and this Pledge
Agreement shall continue as a first priority lien on all Pledged
Collateral not expressly released or substituted.
11. RIGHTS OF REQUIRED LENDERS. All rights of the Collateral Agent
hereunder, if not exercised by the Collateral Agent, may be exercised by the
Required Lenders.
12. APPLICATION OF PROCEEDS. Upon the occurrence and during the
continuance of an Event of Default, any payments in respect of the Pledgor
Obligations and any proceeds of any Pledged Collateral, when received by the
Collateral Agent or any of the Lenders in cash or its equivalent, will be
applied in reduction of the Pledgor Obligations in the order set forth in
SECTION 9.3 of the Credit Agreement, and the Pledgor irrevocably waives the
right to direct the application of such payments and proceeds and acknowledges
and agrees that the Collateral Agent shall have the continuing and exclusive
right to apply and reapply any and all such payments and proceeds in the
Collateral Agent's sole discretion, notwithstanding any entry to the contrary
upon any of its books and records.
13. COSTS AND EXPENSES. At all times hereafter, the Pledgor agrees to
promptly pay upon demand any and all reasonable costs and expenses of the
Collateral Agent or the Lenders, (a) as required under SECTION 11.5 of the
Credit Agreement and (b) as necessary to protect the Pledged Collateral or to
exercise any rights or remedies under this Pledge Agreement or with respect to
any Pledged Collateral. All of the foregoing costs and expenses shall constitute
Pledgor Obligations hereunder.
14. CONTINUING AGREEMENT.
(a) This Pledge Agreement shall be a continuing agreement in every
respect and shall remain in full force and effect so long as any of the
Pledgor Obligations remain outstanding (other than any such obligations
which by the terms thereof are stated to survive termination of the Credit
Documents) or any Credit Document or Hedging Agreement between any Credit
Party and any Lender (to the extent the obligations of such Credit Party
thereunder constitute Credit Party Obligations) is in effect, and until
all of the Commitments thereunder shall have terminated. Upon such payment
and termination, this Pledge Agreement shall be automatically terminated
and the Collateral Agent and the Lenders shall, upon the request and at
the expense of the Pledgor, (i) return all certificates representing the
Pledged Capital Stock, all other certificates and instruments
10
constituting Pledged Collateral and all instruments of transfer or
assignment which have been delivered to the Collateral Agent pursuant to
this Pledge Agreement and (ii) forthwith release all of its liens and
security interests hereunder and shall execute and deliver all UCC
termination statements and/or other documents reasonably requested by the
Pledgor evidencing such termination. Notwithstanding the foregoing, all
releases and indemnities provided hereunder shall survive termination of
this Pledge Agreement.
(b) This Pledge Agreement shall continue to be effective or be
automatically reinstated, as the case may be, if at any time payment, in
whole or in part, of any of the Pledgor Obligations is rescinded or must
otherwise be restored or returned by the Collateral Agent or any Lender as
a preference, fraudulent conveyance or otherwise under any bankruptcy,
insolvency or similar law, all as though such payment had not been made;
provided that in the event payment of all or any part of the Pledgor
Obligations is rescinded or must be restored or returned, all reasonable
costs and expenses (including without limitation any reasonable legal fees
and disbursements) incurred by the Collateral Agent or any Lender in
defending and enforcing such reinstatement shall be deemed to be included
as a part of the Pledgor Obligations.
15. AMENDMENTS; WAIVERS; MODIFICATIONS. This Pledge Agreement and the
provisions hereof may not be amended, waived, modified, changed, discharged or
terminated except as set forth in SECTION 11.6 of the Credit Agreement.
16. SUCCESSORS IN INTEREST. This Pledge Agreement shall create a
continuing security interest in the Pledged Collateral and shall be binding upon
the Pledgor, its successors and assigns and shall inure, together with the
rights and remedies of the Collateral Agent and the Lenders hereunder, to the
benefit of the Collateral Agent and the Lenders and their successors and
permitted assigns; PROVIDED, HOWEVER, that the Pledgor may not assign its rights
or delegate its duties hereunder without the prior written consent of each
Lender or the Required Lenders, as required by the Credit Agreement. To the
fullest extent permitted by law, the Pledgor hereby releases the Collateral
Agent and each Lender, and its successors and assigns, from any liability for
any act or omission relating to this Pledge Agreement or the Pledged Collateral,
except for any liability arising from the gross negligence or willful misconduct
of the Collateral Agent, or such Lender, or its officers, employees or agents.
17. NOTICES. All notices required or permitted to be given under this
Pledge Agreement shall be in conformance with SECTION 11.1 of the Credit
Agreement.
18. COUNTERPARTS. This Pledge Agreement may be executed in any number of
counterparts, each of which where so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this Pledge Agreement to produce or
account for more than one such counterpart.
19. HEADINGS. The headings of the sections and subsections hereof are
provided for convenience only and shall not in any way affect the meaning,
construction or interpretation of any provision of this Pledge Agreement.
20. GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.
(a) THIS PLEDGE AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. Any legal action or
proceeding with respect to this Pledge Agreement may be brought in the
courts of the State of New York, or of the United States for the Xxxxxxxx
Xxxxxxxx xx Xxx Xxxx,
00
and, by execution and delivery of this Pledge Agreement, the Pledgor
hereby irrevocably accepts for itself and in respect of its property,
generally and unconditionally, the jurisdiction of such courts. The
Pledgor further irrevocably consents to the service of process out of any
of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage
prepaid, to it at the address for notices pursuant to SECTION 11.1 of the
Credit Agreement, such service to become effective 30 days after such
mailing. Nothing herein shall affect the right of the Collateral Agent to
serve process in any other manner permitted by law or to commence legal
proceedings or to otherwise proceed against the Pledgor in any other
jurisdiction.
(b) The Pledgor hereby irrevocably waives any objection which it may
now or hereafter have to the laying of venue of any of the aforesaid
actions or proceedings arising out of or in connection with this Pledge
Agreement brought in the courts referred to in subsection (a) hereof and
hereby further irrevocably waives and agrees not to plead or claim in any
such court that any such action or proceeding brought in any such court
has been brought in an inconvenient forum.
21. WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH
OF THE PARTIES TO THIS PLEDGE AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS PLEDGE AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
22. SEVERABILITY. If any provision of this Pledge Agreement is determined
to be illegal, invalid or unenforceable, such provision shall be fully severable
and the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
23. ENTIRETY. This Pledge Agreement, the other Credit Documents and the
Hedging Agreements between any Credit Party and any Lender (to the extent the
obligations of such Credit Party thereunder constitute Credit Party Obligations)
represent the entire agreement of the parties hereto and thereto, and supersede
all prior agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents, such
Hedging Agreements or the transactions contemplated herein and therein.
24. SURVIVAL. All representations and warranties of the Pledgor hereunder
shall survive the execution and delivery of this Pledge Agreement, the other
Credit Documents and the Hedging Agreements between any Credit Party and any
Lender (to the extent the obligations of such Credit Party thereunder constitute
Credit Party Obligations), the delivery of the Notes, the making of the Loans
and the issuance of the Letters of Credit.
25. OTHER SECURITY. To the extent that any of the Pledgor Obligations are
now or hereafter secured by property other than the Pledged Collateral
(including, without limitation, real and other personal property owned by the
Pledgor), or by a guarantee, endorsement or property of any other Person, then
the Collateral Agent and the Lenders shall have the right to proceed against
such other property, guarantee or endorsement upon the occurrence of any Event
of Default, and the Collateral Agent and the Lenders have the right, in their
sole discretion, to determine which rights, security, liens, security interests
or remedies the Collateral Agent and the Lenders shall at any time pursue,
relinquish, subordinate, modify or take with respect thereto, without in any way
modifying or affecting any of them or any of the Collateral Agent's and the
Lenders' rights or the Pledgor Obligations under this Pledge Agreement, under
12
any other of the Credit Documents or under any Hedging Agreement between any
Credit Party and any Lender (to the extent the obligations of such Credit Party
thereunder constitute Credit Party Obligations).
[remainder of page intentionally left blank]
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Each of the parties hereto has caused a counterpart of this Pledge
Agreement to be duly executed and delivered as of the date first above written.
PLEDGOR: MSN HOLDINGS, INC.,
a Delaware corporation
By: /s/ Xxxxx Xxxxxxxx
---------------------------------------
Title: Xxxxx Xxxxxxxx
------------------------------------
Name: Director
-------------------------------------
Accepted and agreed as of the date first above written.
BANK OF AMERICA, N.A., as Collateral Agent
By: /s/ Xxxxx X. Xxxx
---------------------------------------
Name: Xxxxx X. Xxxx
-------------------------------------
Title: Managing Director
------------------------------------
