EXHIBIT 10.42
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT, dated as of November 27, 2002 (this "PLEDGE"),
is made by CG AUSTRIA, INC., a Delaware corporation having an office at One
Technology Center, Mail Drop 15, Xxxxx, Xxxxxxxx 00000 ("PLEDGOR") to XXXXXXXX
HEADQUARTERS BUILDING COMPANY, a Delaware corporation, having an office at One
Xxxxxxxx Center, Mail Drop 41-3, Xxxxx, Xxxxxxxx 00000, (together with its
successors and assigns, "LENDER").
All capitalized terms used herein but not defined herein shall have the
meanings specified in the Mortgage (as defined below).
WITNESSETH:
WHEREAS, the Lender as seller, Xxxxxxxx Technology Center, LLC, a
Delaware limited liability company ("WTC") as purchaser, WilTel Communications
Group, Inc., a Nevada corporation ("NEW WCG"), formerly known as Xxxxxxxx
Communications Group, Inc., a Delaware corporation, prior to its reorganization
pursuant to the Plan ("WCG"), Xxxxxxxx Communications, LLC, a Delaware limited
liability company ("WCL") and Xxxxxxxx Aircraft Leasing, LLC, a Delaware limited
liability company ("WAL") are parties to that certain Real Property Purchase and
Sale Agreement dated as of July 26, 2002 (as amended by the First Amendment to
Real Property Purchase and Sale Agreement dated as of October 15, 2002 among
Lender, WTC, WCG, WCL, New WCG, WAL and Xxxxxxxx Aircraft, Inc., a Delaware
corporation ("WAI"), and as further amended by the Second Amendment to Real
Property Purchase and Sale Agreement dated as of October 23, 2002 among Lender,
WTC, WCL, New WCG, WAL, WAI and, for purpose of Section 15 therein, The Xxxxxxxx
Companies, Inc., a Delaware corporation (as so amended, and as the same may be
further amended, restated, supplemented or otherwise modified from time to time,
collectively, the "PURCHASE AGREEMENT");
WHEREAS, in consideration of the benefits to WTC derived from Lender's
entering into the Purchase Agreement and Lender's performance of its obligations
thereunder (including, without limitation, Lender's conveyance of the Land and
Improvements to WTC pursuant thereto), WTC, WCG, and WCL executed and delivered
to Lender as payee, (a) a promissory note dated as of October 15, 2002 in the
original principal amount of $100,000,000, with a maturity date of April 1, 2010
or such earlier date to which it may be accelerated pursuant to the terms
thereof (as hereafter amended, extended, replaced, restated, supplemented,
restructured, increased or refinanced from time to time, "LONG-TERM NOTE"); and
(b) a promissory note dated as of October 15, 2002 in the original principal
amount of $44,800,000 and having an aggregate (principal and interest) accreted
value at maturity of $74,360,295.30 with a maturity date of December 29, 2006 or
such earlier date to which it may be accelerated pursuant to the terms thereof
(as hereafter amended, extended, replaced, restated, supplemented, restructured,
increased or refinanced from time to time, the "SHORT-TERM NOTE");
WHEREAS, Pledgor is a wholly owned direct subsidiary of New WCG and
will benefit from the extensions of credit under the Notes;
WHEREAS, Pledgor will acquire and own as of November 29, 2002 not less
than sixty-six percent (66%) of the stock and beneficial interests in WilTel
Communications Pty. Limited (ACN 081 547 042), a corporation organized and
existing under the laws of Australia ("COMPANY");
WHEREAS, Lender has required as a condition precedent to making the
loans (the "LOAN") evidenced by the Notes that this Pledge be duly executed and
delivered by Pledgor to Lender to secure the Obligations;
WHEREAS, in order to induce Lender to make the Loan, Pledgor wishes to
execute, and deliver to Lender this Pledge;
WHEREAS, this Pledge is subject to the provisions of the Intercreditor
Agreement (as hereinafter defined) in all respects; and
WHEREAS, it is a condition to the effectiveness of this Pledge that the
FIRB Approval (hereinafter defined) is obtained.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Pledgor hereby covenants and agrees for the benefit of Lender as
follows:
1. Definitions. For the purposes of this Pledge, the following terms
shall have the meanings set forth hereinbelow:
"ACKNOWLEDGMENT" shall have the meaning set forth in the Paragraph 3.
"ADMINISTRATIVE AGENT" shall mean Bank of America, N.A., as
Administrative Agent under the Credit Agreement, together with its successors
and assigns.
"BUSINESS DAY" shall mean any day other than a Saturday, Sunday or day
on which banks are authorized to be closed in Tulsa, Oklahoma.
"COLLATERAL" shall have the meaning set forth in Paragraph 2.
"COMPANY" shall have the meaning set forth in the Recitals.
"CREDIT AGREEMENT" shall have the meaning set forth in the
Intercreditor Agreement.
"CREDIT AGREEMENT LENDER" shall mean a "Lender" (as such term is
defined in the Credit Agreement).
"DEFAULT RATE" shall have the meaning set forth in the Short Term Note.
"DISTRIBUTIONS" shall mean any and all income, payments, earnings,
dividends and distributions, whether in cash or in kind, accruing or becoming
due, paid or payable to Pledgor by reason of or otherwise in connection with
Pledgor's Interest.
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"EVENT OF DEFAULT" shall have the meaning set forth in the Mortgage.
"FIRB APPROVAL" shall mean either (a) by a lapse of time the Treasurer
of the Commonwealth of Australia becomes precluded from making an order in
respect of the arrangements contemplated by this Pledge and the Second Equitable
Mortgage or (b) a notice in writing is issued by or on behalf of the Treasurer
of the Commonwealth of Australia to Lender stating that the Commonwealth
Government does not object to the arrangements contemplated by this Pledge or
the Second Equitable Mortgage, either conditionally on terms acceptable to
Lender in its sole discretion or unconditionally.
"FIRST EQUITABLE MORTGAGE" shall mean that certain First Equitable
Mortgage of Shares dated as of the date hereof, executed by Pledgor and
Administrative Agent, as the same may be amended, restated, supplemented or
otherwise modified from time to time.
"INTERCREDITOR AGREEMENT" shall mean that certain Intercreditor and
Subordination Agreement (PowerTel Collateral) dated as of October 15, 2002, by
and between Lender and the Administrative Agent and consented to by the Loan
Parties (as defined therein) and the Company, as amended, restated, supplemented
or otherwise modified, renewed or replaced from time to time.
"INTEREST" shall mean any direct or indirect ownership, equity, record
or beneficial interest of any kind or nature of Pledgor in Company, including,
without limitation, interests in Company's stock and Pledgor's rights, title and
interest in, to and under the Shareholders Agreement, and any right, including
without limitation any option, put, call or warrant and rights to vote and
receive Distributions relating to such interest, and any and all rights to
principal, interest and other sums due under any loans by Pledgor to Company;
provided, however, that anything to the contrary herein or elsewhere in this
Pledge notwithstanding, at no time and in no event shall more than 66% of the
total outstanding beneficial interests in the Company constitute "Interest" or
otherwise be pledged to or subject to a security interest in favor of Lender
under this Pledge or the Second Equitable Mortgage.
"LENDER" shall have the meaning set forth in the preamble to this
Pledge.
"LOAN" shall have the meaning set forth in the Recitals.
"LONG-TERM NOTE" shall have the meaning set forth in the Recitals.
"MORTGAGE" shall mean that certain Mortgage With Power of Sale,
Security Agreement, Assignment of Leases, Rents and Profits, Financing Statement
and Fixture Filing made by WTC to the Lender dated as of October 15, 2002, as
the same may be amended, restated, supplemented or to otherwise modified from
time to time.
"NEW WCG" shall have the meaning set forth in the Recitals.
"NOTES" shall mean, collectively, the Short-Term Note and the Long-Term
Note.
"NOTICE OF DEFAULT" shall have the meaning set forth in Paragraph 10
hereof.
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"PERMITTED DISPOSITION" shall mean any sale, assignment, transfer,
issuance or other disposition (a) by Pledgor of any direct or indirect
ownership, equity or other beneficial interest in the Company or any other
Collateral to any Person or (b) by Pledgor or the Company of any direct or
indirect ownership, equity or other beneficial interest in PowerTel to any
Person, provided that (i) the net proceeds of any such sale, assignment,
transfer, issuance or other disposition shall be deposited into a new account
with a Credit Agreement Lender that is subject to an account control agreement
(or account control agreements, as applicable) which is or are reasonably
satisfactory to such Credit Agreement Lender, the Administrative Agent and
Lender subject to (x) a perfected first lien and security interest in favor of
the Administrative Agent for the benefit of the Secured Parties (as defined in
the Security Agreement) and (y) a perfected second lien and security interest in
favor of Lender (as applicable); (ii) the consideration received in connection
with any such sale, assignment, transfer, issuance or other disposition shall
not be less than the fair value of the property sold, assigned, transferred,
issued or otherwise disposed of, as determined in good faith and approved by the
board of directors of Pledgor; (iii) any such sale, assignment, transfer,
issuance or other disposition shall be effected on an arm's-length basis; and
(iv) Pledgor shall deliver to Lender, no less than ten (10) Business Days prior
to the date of any such expected sale, assignment, transfer, issuance or other
disposition, written notice of the identity of the purchaser, assignee or other
transferee, the expected date of closing such sale, assignment, transfer,
issuance or other disposition, the expected date of receipt by Pledgor of the
net proceeds (including the approximate amount thereof) with respect thereto,
the principal terms of such sale, assignment, transfer, issuance or other
disposition, and such other information as Lender may reasonably request in
writing (in each case subject to any applicable confidentiality provisions or
requirements).
"PERMITTED ENCUMBRANCES" shall mean "Permitted Encumbrances" as defined
in the Credit Agreement on the date hereof.
"PLEDGE" shall have the meaning set forth in the preamble to this
Pledge.
"PLEDGOR" shall have the meaning set forth in the preamble to this
Pledge.
"POWERTEL" shall mean PowerTel Limited (f/k/a Spectrum Network Systems
Limited) (ACN 001 760 103), a corporation organized and existing under the laws
of Australia.
"PURCHASE AGREEMENT" shall have the meaning set forth in the Recitals.
"SECOND EQUITABLE MORTGAGE" shall mean that certain Second Equitable
Mortgage of Shares dated the date hereof, executed by Pledgor and Lender and
consented to by the Company, as the same may be amended, restated, supplemented
or otherwise modified from time to time.
"SECURITY AGREEMENT" shall mean that certain Amended and Restated
Security Agreement dated as of April 23, 2001, as amended and restated as of
October 15, 2002 made by Pledgor and certain other parties in favor of the
Administrative Agent, as the same may be amended, restated, replaced,
refinanced, supplemented or otherwise modified from time to time.
"SHAREHOLDERS AGREEMENT" shall mean that certain Spectrum Shareholders
Agreement dated June 19, 1998 by and among the Company, Downtown Utilities Pty
Limited
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(ACN 082 754 407), as Trustee, Xxxxx-Xxxx Xxxxxxxxxx Electricity Corporation
Limited trading as Energex (ACN 078 849 055), CitiPower Pty (ACN 064 651 056),
Energy Australia, a statutory SOC under the Stated Owned Corporations Xxx 0000
(NSW) and Xxxxxxxx Holdings of Delaware, Inc., a Delaware corporation, as
amended, restated, supplemented or otherwise modified from time to time.
"SHORT-TERM NOTE" shall have the meaning set forth in the Recitals.
"STOCK CERTIFICATE" shall mean all certificates now and/or hereafter
issued to Pledgor representing Pledgor's Interest.
"UCC-1s" shall mean the financing statements described in Paragraph
3(b) hereof.
"VOLUNTARY BANKRUPTCY EVENT" shall mean the occurrence of any or all of
the following actions by or with respect to Pledgor and/or Company: (i) filing
of a voluntary petition in bankruptcy or a petition or answer seeking or
consenting to any reorganization or for an arrangement, imposition,
readjustment, composition, liquidation, dissolution, winding-up or any other
relief for itself or with respect to its debts pursuant to the United States
Bankruptcy Code or any similar law or regulation of any Governmental Authority
relating to distress of debtors or relief for debtors, now or hereafter in
effect; (ii) an assignment for the benefit of creditors or such party admits in
writing its inability to pay its debts as they become due; or (iii) seeking or
consenting to the appointment of a receiver, trustee, custodian, conservator,
liquidator or other similar official of such party, for all or any part of the
Collateral; (iv) committing any voluntary or involuntary "act of insolvency" as
such term is defined in the United States Bankruptcy Code or any state law or
similar law or regulation of any federal, state, domestic, foreign or other
jurisdiction; (v) there is filed against it in any proceeding or other action,
an involuntary petition, arrangement, imposition, readjustment composition,
liquidation, dissolution, winding-up or an answer proposing an adjudication of
it as bankrupt or insolvent, or, an action seeking to appoint a trustee,
receiver, custodian, or conservator or liquidator, or is subject to a
reorganization, in any such case, pursuant to the United States Bankruptcy Code
or any similar law or regulation, federal, state, domestic or foreign now or
hereafter in effect, and any such filing, answer, action or other proceeding is
approved by any court of competent jurisdiction and the order approving the same
shall not be vacated, stayed, set aside or discharged within ninety (90) days
from entry; or (vi) it fails to deny the material allegations of a filing of any
such petition or answer in a timely manner.
"WAL" shall have the meaning set forth in the Recitals.
"WCG" shall have the meaning set forth in the Recitals.
"WCL" shall have the meaning set forth in the Recitals.
"WTC" shall have the meaning set forth in the Recitals.
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2. Pledge.
Notwithstanding anything in this Pledge Agreement to the contrary,
this Pledge shall not be effective unless and until the FIRB Approval has
been obtained by Lender and, upon the receipt by Lender of the FIRB
Approval, this Pledge shall be effective as of the date hereof.
(a) As security for the prompt and complete payment and
performance of the Obligations, Pledgor hereby pledges, assigns and
hypothecates to Lender and grants to Lender a continuing, perfected and
second priority lien upon and security interest (subject only to the lien
and security interest granted by Pledgor to the Administrative Agent
pursuant to the Security Agreement) in, to and under all of Pledgor's
right, title and interest in and to the following (collectively, the
"COLLATERAL"), whether now existing or hereafter from time to time
acquired (provided that in no event shall the equity interests in the
Company pledged to or subject to a security interest in favor of Lender
pursuant to this Pledge and/or the Second Equitable Mortgage exceed 66% of
the beneficial interests in the Company):
(i) Pledgor's Interest;
(ii) Distributions;
(iii) all Stock Certificates;
(iv) all additional certificates or other evidence of
Pledgor's Interest in Company received by Pledgor or to which
Pledgor is entitled pursuant to any reclassification,
reorganization, or increase or reduction of capital attributable to
any certificate described in clause (iii) above or in substitution
of or in exchange of any certificate described in clause (iii)
above;
(v) any loans made by Pledgor to the Company, including the
full principal balance thereof, and all interest and other sums due
thereon;
(vi) all interest, cash, dividends, checks and other
instruments and property from time to time hereafter received,
receivable or otherwise distributed in addition to, in respect of or
in exchange or substitution for all or any portion of Pledgor's
Interest; and
(vii) all proceeds (other than Distributions made prior to the
occurrence of an Event of Default (as hereinafter defined)) retained
by Pledgor in accordance with Paragraph 11(b) hereof) of, from and
relating to any of the foregoing.
(b) This Pledge shall be in addition to, and shall in no way
limit or impair, any rights of Lender in, to and under any other
collateral, including without limitation the Mortgaged Property, or any of
the Loan Documents.
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3. Delivery and Registration of Pledged Collateral.
(a) The administration of the Collateral and this Pledge shall
be subject in all respects to the Intercreditor Agreement and, subject to
the provisions of the Intercreditor Agreement and the rights of the
Administrative Agent pursuant to the Security Agreement and the First
Equitable Mortgage, all Collateral (other than Distributions made prior to
the occurrence and continuance of an Event of Default to the extent
provided in Paragraph 11 hereof) shall, at Lender's sole option, be
delivered by delivery of all certificates or instruments (if any)
representing or evidencing such Collateral in suitable form for transfer
under applicable law by delivery or accompanied by duly executed
instruments of transfer or assignment, undated and in blank, all in form
and substance reasonably satisfactory to Lender. Upon the issuance of any
such certificate or instrument, the same shall be so assigned, delivered
and endorsed to Lender promptly without the need for any request therefor
by Lender. Lender shall have the right, at any time and from time to time
upon the occurrence and during the continuance of an Event of Default in
its discretion and without notice to Pledgor, to transfer to or to
register in its name or in the name of any of its nominees any or all of
the Collateral; provided, however, that the foregoing shall not be
construed to limit Lender's rights to perfect and continue the perfection
of its security interest in the Collateral pursuant to this Pledge or the
Second Equitable Mortgage prior to the occurrence of an Event of Default.
(b) In addition to and not in limitation of the foregoing,
concurrently with the execution of this Pledge, (i) Pledgor shall deliver
to Lender the "ACKNOWLEDGMENT" in the form of Exhibit A hereto confirming,
inter alia, that Company has noted the pledge effected by this Pledge and
the Second Equitable Mortgage on its books, and (ii) Lender shall be
authorized to file UCC-1 financing statements ("UCC-1s") and such other
documents and instruments, covering the Collateral in form suitable for
filing and/or recording in all jurisdictions (including, without
limitation, Australia) necessary or reasonably required by Lender to
create or perfect Lender's interest in the Collateral, to the extent such
creation or perfection may be accomplished by such filings, documents
and/or instruments.
4. Property in the Custody of Lender. Other than the exercise of
reasonable care to assure the safe custody of any Stock Certificates,
instruments or funds constituting part of the Collateral as may from time to
time be delivered into Lender's possession under this Pledge, Lender shall not
have any duty or liability to preserve the Collateral or any part thereof or any
of Pledgor's rights pertaining thereto. Lender shall be relieved of
responsibility for any portion of the Collateral upon surrendering it or
tendering surrender of it. Without limiting the generality of the foregoing,
neither Lender nor any of its respective officers, agents or employees shall be
liable (i) for failure to invest or reinvest the cash paid to Lender under this
Pledge or the Second Equitable Mortgage or for any losses incurred by reason of
investments made by Lender or the Second Equitable Mortgage or by reason of the
insolvency of any Person, or (ii) for any action taken or omitted to be taken by
Lender in good faith in accordance with the advice of counsel with respect to
any question as to the construction of any provision of this Pledge or the
Second Equitable Mortgage or any action to be taken by Lender under this Pledge
or the Second Equitable Mortgage or, in accordance with any instructions or
other notices which Lender
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believes in good faith to be properly given by Pledgor, except for any action
taken or failed to be taken as a result of the gross negligence or willful
misconduct of Lender. All investments of all or part of the Collateral by Lender
and all income and proceeds thereof shall be held in the name of Lender and
constitute part of the Collateral. All risk of loss with respect to investments
shall be on Pledgor, subject to the terms of this Paragraph 4.
5. Representations and Warranties. Pledgor hereby represents and
warrants to Lender, as of the date hereof, as follows:
(a) As of November 29, 2002, (i) Pledgor will be the sole
beneficial owner and holder of the Interest, which constitutes at least
66% of the beneficial interests in the Company; and (ii) no party other
than Pledgor will have any option, warrant, call, commitment or other
right with respect to the Collateral (other than the rights of the
Administrative Agent pursuant to the Security Agreement, the First
Equitable Mortgage and the Intercreditor Agreement).
(b) As of November 29, 2002, Pledgor shall be the true, legal
and lawful owner and holder of all Collateral (including Collateral
acquired after such date), free and clear of any liens, pledges, security
interests or encumbrances whatsoever, subject only to this Pledge, the
Second Equitable Mortgage, and the Security Agreement, the First Equitable
Mortgage, and the Intercreditor Agreement and other Permitted Encumbrances
encumbering the Collateral.
(c) Pledgor is a Delaware corporation, duly formed, validly
existing and in good standing under the laws of the State of Delaware, and
has all requisite corporate power and authority to execute, deliver and
perform all of its obligations set forth in this Pledge and the Second
Equitable Mortgage. Pledgor (i) is not incorporated in any jurisdiction of
Australia (as determined under Australian law), (ii) does not carry on
business in Australia and (iii) for Australian tax law purposes, is not a
resident of Australia or a non-resident of Australia carrying on business
at or through a permanent establishment in Australia.
(d) This Pledge and the Second Equitable Mortgage constitutes
the legal, valid and binding obligation of Pledgor, enforceable in
accordance with its terms, subject only to applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to
or affecting creditors' rights generally and general principles of equity.
(e) The execution, delivery and performance by Pledgor of this
Pledge and the Second Equitable Mortgage, the exercise by Lender, subject
to the limitations contained herein, of the voting or other rights and
remedies provided in this Pledge in respect of the Collateral (i) have
been duly authorized by all necessary corporate action of the Pledgor;
(ii) do not require the approval of any Governmental Authority of the
United States or Australia (other than the FIRB Approval) or other third
party which have not been obtained or require any action of, or filing
with, any Governmental Authority of the United States or Australia (other
than the FIRB Approval) or other third party to authorize same (other than
the filing of a UCC-1); and (iii) do not and shall not (A)
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violate or result in the breach of any provision of law or regulation, any
order or decree of any court or other Governmental Authority of the United
States or Australia, (B) violate, result in the breach of or constitute an
event of default under or conflict with any indenture, mortgage, deed of
trust, agreement or any other instrument to which Pledgor is a party or by
which any of Pledgor's assets (including, without limitation, the
Collateral) are bound, except to the extent that Lender's exercise of
voting or other rights and remedies under this Pledge violate, result in
the breach of or constitute an event of default under or conflict with
Section 7.09 of the Shareholders Agreement, or (C) result in the creation
or imposition of any lien, charge or encumbrance of any nature whatsoever
upon any of the properties or assets of Pledgor except for the Security
Agreement, the First Equitable Mortgage and the Intercreditor Agreement.
(f) There is not now pending or, to the best of Pledgor's
knowledge, threatened, any action or proceeding at law or in equity or by
or before any Governmental Authority of the United States or Australia
(other than the FIRB Approval) which if adversely determined would impair
or materially adversely affect Pledgor's or Lender's interest in the
Collateral or the value thereof or Pledgor's aggregate financial condition
or operations.
(g) There is no financing statement (or similar document or
registration under the law of any applicable jurisdiction) now on file or
registered in any public office covering any interest of Pledgor in the
Collateral, other than with respect to UCC financing statements filed in
connection with the Security Agreement and financing statements or similar
documents or registrations filed in connection with the First Equitable
Mortgage and the Second Equitable Mortgage. There are no set-offs,
counterclaims or defenses with respect to the Collateral and no agreement
has been made by Pledgor or any subsidiaries of New WCG with any other
Person with respect to the Collateral, except for the Security Agreement,
the First Equitable Mortgage, the Intercreditor Agreement and the
Shareholders Agreement.
(h) Pledgor has obtained all required consents to this Pledge,
and the Second Equitable Mortgage, including, without limitation, the
consent of Company and the Administrative Agent.
(i) In the event Pledgor changes its state of incorporation
Pledgor shall notify Lender within two months thereafter, and furnish to
Lender or authorize Lender to file (at Pledgor's sole cost and expense)
and/or record any UCC-1 financing statements or similar documents or
registrations or amendments thereto as may be reasonably requested by
Lender in connection therewith.
6. Further Assurances. Upon the request of Lender, Pledgor shall, at
Pledgor's sole cost and expense, execute and deliver all such further UCC-1s and
similar documents and registrations, continuation statements, assurances and
consents with respect to the pledge of the Collateral and the execution of this
Pledge and the Second Equitable Mortgage, and shall execute and deliver such
further instruments, agreements and other documents and do such further acts and
things, as Lender may reasonably request in order to more fully effectuate the
purposes of this Pledge and/or the Second Equitable Mortgage, and to obtain the
full benefits of
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this Pledge and the Second Equitable Mortgage, and the rights and powers herein
and therein created.
7. Attorney-in-Fact. Pledgor hereby authorizes Lender at any time to
take any action and to execute any instrument, financing statements and/or
continuation statements covering the Collateral, to evidence and perfect the
security interest created hereby and irrevocably appoints Lender as its true and
lawful attorney-in-fact, which power of attorney shall be coupled with an
interest, with full authority in the place and stead of Pledgor and in the name
of Pledgor or otherwise, from time to time, in Lender's sole and absolute
discretion, (a) for the purpose of executing such statements in the name of and
on behalf of Pledgor, and thereafter filing any such financing and/or
continuation statements and (b) to receive, endorse and collect all instruments
made payable to Pledgor representing any interest payment or other distribution
in respect of the Collateral or any part thereof and to give full discharge for
the same; provided that Lender shall not execute any document as
attorney-in-fact of Pledgor under clause (a) of this Paragraph 7 or take any
action specified in clause (b) of this Paragraph 7 unless and until an Event of
Default shall have occurred and be continuing. Nothing contained in this
Paragraph 7 shall result in the expansion of the obligations, or the reduction
of the rights, of Pledgor hereunder.
8. Covenants and Agreements. In addition to any and all other
covenants and agreements by Pledgor under this Pledge, Pledgor further covenants
and agrees until the Obligations have been paid in full that:
(a) (i) the Interest shall continue to constitute not less
than 66% of the total beneficial interests in the Company and the Stock
Certificates shall be in certificated form; and (ii) Pledgor shall defend
the Collateral against the claims and demands of all persons whomsoever
and shall defend Lender's security interest therein against all material
claims and demands of any other person or party at any time claiming the
same or any interest therein adverse to Lender, subject to the rights,
title and interest of the Administrative Agent pursuant to the Security
Agreement and the First Equitable Mortgage.
(b) Pledgor shall not directly or indirectly further assign,
pledge, hypothecate, transfer, exchange, grant any option or security
interest in and with respect to, or otherwise dispose of or encumber, the
Collateral or any beneficial or other interest therein except (i) to the
Administrative Agent, subject to and in accordance with the Security
Agreement and other Permitted Encumbrances encumbering the Collateral or
(ii) pursuant to a Permitted Disposition.
(c) Pledgor shall from time to time pay and discharge, all
taxes, assessments and charges imposed on the Collateral by any
Governmental Authority, except to the extent failure to do so could not
reasonably be expected to have a material adverse affect on the Collateral
or Lender's security interest therein; Pledgor may contest any such taxes,
assessments or governmental charges in good faith by appropriate
proceeding where the failure to do so could not reasonably be expected to
materially and adversely affect the Collateral or Lender's security
interest therein.
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(d) Pledgor shall give Lender notice promptly after any
officer of Pledgor with executive responsibilities with respect to Pledgor
obtains actual knowledge thereof, (i) of the occurrence of any breach by
Pledgor of its obligations under this Pledge and/or the Second Equitable
Mortgage and (ii) of any action or proceeding to which Pledgor is a party,
or affecting Pledgor, except to the extent failure to do so could not
reasonably be expected to have a material adverse affect on Pledgor or the
Collateral or Lender's security interest therein.
(e) Pledgor shall deliver to Lender after the occurrence and
during the continuance of any Event of Default or as otherwise required by
Paragraph 11 hereof any and all Distributions payable or paid to Lender
pursuant to the terms of this Pledge and shall deliver to Lender all
principal, interest and other sums due or paid under any loans by Pledgor
to Company. Pledgor shall promptly deliver to Lender all notes or other
evidence of indebtedness with respect to such loans.
(f) Pledgor shall not permit any Voluntary Bankruptcy Event to
occur without the express prior written consent of Lender.
(g) Pledgor shall not permit the liquidation, dissolution,
winding up or discontinuation, in whole or in part, of Pledgor or Company
without the express prior written consent of Lender.
(h) Pledgor agrees, notwithstanding any provision in its or
the Company's organizational documents or in the Shareholders Agreement,
(i) not to take any action (or fail to take an action which failure would
have such effect) to terminate, dilute, impair or otherwise adversely
affect in any material respect Lender's legal rights, remedies or
interests under this Pledge or the Second Equitable Mortgage (provided
that the Pledgor shall not be in default of such obligation if (x) the
Pledgor or the Company, in exercising its reasonable business judgment,
acts in good faith with due regard to the terms hereof and the interests
of Lender hereunder or (y) if Pledgor or the Company enters into and
consummates a transaction permitted under Section 8(b) hereof) and shall
cause the Company to amend (in form and substance reasonably satisfactory
to Lender) its organizational documents to similarly so provide and to
preclude any such action or inaction having such effect, and to obtain all
necessary consents and perform such other actions which are a prerequisite
to such amendments and (ii) to otherwise promptly comply with Lender's
reasonable requests to ensure that the Company is and remains a special
purpose entity (the purpose and activities of which shall be limited to
owning the stock of PowerTel).
(i) Pledgor shall provide twenty (20) days prior notice to
Lender if at any time after the date hereof it intends (i) be incorporated
in any jurisdiction of Australia, (ii) carry on business in Australia (as
determined under Australian law) or (iii) for Australian tax purposes,
become a resident of Australia or a non-resident of Australia carrying on
business at or through a permanent establishment in Australia.
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(j) The acquisition of all or any portion the Collateral by
the Pledgor does not require notification to the Treasurer of the
Commonwealth of Australia under section 26 of the Foreign Acquisitions and
Takeover Xxx 0000.
9. Indemnification. Pledgor shall and does hereby agree to indemnify
Lender for and to hold Lender harmless from and against any and all loss, cost,
damage, liability or expense (including without limitation attorneys' fees and
disbursements reasonably incurred) which arise from (a) Pledgor's failure to
comply with any of its obligations hereunder or under the Second Equitable
Mortgage and/or (b) any and all claims and demands whatsoever which may be
asserted against Lender by reason of any alleged obligations or undertakings on
its part to perform or discharge any of the terms, covenants or agreements
contained in the Pledge and/or the Second Equitable Mortgage, except to extent
any claims and demands arise from Lender's gross negligence or willful
misconduct. Should Lender incur any such liability, loss or damage, the amount
thereof shall be deemed part of the Obligations and secured hereby and Pledgor
shall reimburse Lender therefor promptly upon receipt of written demand of
Lender specifying such liability, loss or damage in reasonable detail.
10. Events of Default; Remedies.
(a) If any "Event of Default" shall occur under (and as
defined in) the Mortgage, the same shall be deemed an "Event of Default"
hereunder and under the Second Equitable Mortgage.
(b) Upon the occurrence and during the continuance of an Event
of Default, Lender shall have all of the following remedies:
(i) Lender shall have all of the rights and remedies provided
under this Pledge, the Second Equitable Mortgage and/or to a secured
party by the Uniform Commercial Code in effect in the State of New
York, the domicile of Pledgor and any other jurisdiction in which
the Collateral may be located at that time;
(ii) Lender, except to the extent prohibited by law, without
in any manner waiving such Event of Default, may, at its option,
without further notice and without regard to the adequacy of any
security for the Obligations, either in person or by agent, with or
without bringing any action or proceeding, collect and receive all
Distributions;
(iii) Lender, except to the extent prohibited by law, without
the necessity for demand of performance or other demand,
advertisement or notice of any kind of time and place of public or
private sale to or upon any other person (all and each of which
demands, advertisements and/or notices are expressly waived by
Pledgor) shall have the right to forthwith collect, receive,
appropriate and realize upon the Collateral, or any part thereof,
transfer and register in its name or in the name of its nominee the
whole or any part of the Collateral, exchange certificates or
instruments representing or evidencing Collateral (if any) for
certificates or instruments of smaller or larger denominations, and
exercising the
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voting rights thereto, and/or may forthwith sell, assign, give an
option or options to purchase, contract to sell or otherwise dispose
of and deliver the Collateral or any part thereof, in one or more
portions at public or private sale or sales, upon such terms and
conditions as it may deem advisable and at such prices as it may
deem best, for cash, for credit or for future delivery without
assumption of any credit risk, with the right of Lender upon any
such sale or sales, public or private, to purchase the whole or any
part of the Collateral so sold. In connection with any such sale,
assignment, option, contract, disposition or delivery:
(A) the sale of Collateral shall have been made in a
commercially reasonable manner if conducted in conformity with
reasonable commercial practices of banks disposing of similar
property, but in any event, Lender may sell on such terms as
Lender may choose, without assuming any credit risk and
without any obligations to advertise. Further, it shall be
deemed reasonable for Lender to hold such a sale in the City
of Tulsa or any other metropolitan area in the United States.
Pledgor hereby waives any claims against Lender arising by
reason of the fact that the price at which any of the
Collateral may have been sold at any private sale was less
than the price that might have been obtained at a public sale,
even if Lender accepts the first offer received and does not
offer the Collateral to more than one Person;
(B) Lender may apply the proceeds of any such sale or
disposition to the satisfaction of Lender's attorneys' fees
and expenses reasonably incurred and any other costs and
expenses reasonably incurred in connection with Lender's
retaking, holding, preparing for sale, and selling of the
Collateral; and
(C) in the event that notice is necessary, written
notice mailed to Pledgor at the address given below five (5)
Business Days prior to the date of public sale of the
Collateral subject to the lien and security interest created
herein or prior to the date after which private sales or any
other disposition of said Collateral will be made shall
constitute reasonable notice, but notice given in any other
reasonable manner or at any other reasonable time shall be
sufficient;
(iv) Lender may, in its sole and absolute discretion, make any
compromise or settlement deemed desirable by Lender and/or extend
the time of payment or delivery, arrange for payment or delivery in
installments, or otherwise modify the terms of, or release, any of
the Collateral, and without otherwise discharging or affecting the
Obligations, the Collateral or the security interest granted herein;
(v) upon notice to Pledgor by Lender stating that an Event of
Default has occurred and is continuing (the "NOTICE OF DEFAULT"),
all rights of Pledgor to exercise the voting and other rights which
Pledgor would otherwise be entitled to exercise pursuant to
Paragraph 11(a) and all other rights of Pledgor with respect to the
Collateral shall cease, all such rights shall thereupon become
vested in
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Lender and Lender shall thereupon have the sole right to exercise
such voting and other rights;
(vi) all rights of Pledgor to receive Distributions which
Pledgor would otherwise be authorized to receive and retain pursuant
to Paragraph 11(b) herein shall cease, and all such rights shall
thereupon become vested in Lender, which shall thereupon have the
sole right to receive and hold such Distributions as part of the
Collateral;
(vii) all Distributions which are received by Pledgor contrary
to the provisions of Paragraph 10(b)(vi) shall be received in trust
for the benefit of Lender, segregated from other funds of Pledgor
and forthwith paid over to Lender as part of the Collateral in the
form received (with any necessary endorsement); and
(viii) in order to permit Lender to exercise the voting and
other rights which Lender may be entitled to exercise pursuant to
Paragraph 10(b)(v), (vi) and (vii), and to receive all Distributions
which Lender may be entitled to receive under such subparagraphs,
Pledgor shall, if necessary, upon written notice from Lender, from
time to time, execute and deliver to Lender any instruments as
Lender may reasonably request and in form reasonably satisfactory to
Lender in all respects.
11. Voting Rights; Distributions; Etc. At all times, except upon the
occurrence and during the continuance of an Event of Default:
(a) Pledgor shall be entitled to exercise any and all voting
and other consensual rights pertaining to the Collateral or any part
thereof for any purpose not prohibited by the terms hereof.
(b) Pledgor shall be entitled to receive and retain any and
all Distributions, other than any and all:
(i) Distributions 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 of
the Collateral;
(ii) Distributions paid or payable in cash in respect of any
of the 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
(iii) cash paid, payable or otherwise distributed in
redemption of, or in exchange for, any of the Collateral,
all of which shall be, and all of which shall be forthwith delivered to
Lender to hold as, part of the Collateral and, if received by Pledgor,
shall be received in trust for the benefit of Lender, segregated from the
other property or funds of Pledgor, and forthwith
-14-
delivered to Lender as part of the Collateral in the form received (with
any necessary endorsement).
12. Lender's Rights. Lender may, at any time, acting in each
instance in Lender's sole and absolute discretion (subject to the terms of the
Loan Documents):
(a) extend or change the time of payment and/or the manner,
place or terms of payment of all or any of the Obligations;
(b) exchange, release and/or surrender all or any of the
Mortgaged Property, which is now or may hereafter be held by Lender in
connection with the Obligations;
(c) sell and/or purchase all or any of the Mortgaged Property
and dispose of the proceeds thereof; and
(d) enter into and consummate any sales, pledges and/or
transfers of its interests in the Loan and this Pledge and the other Loan
Documents as provided in the Notes.
13. Release. Lender may release or surrender at any time all or any
of the other security for the Obligations, release any party primarily or
secondarily liable thereon and may apply any other security held by it in
satisfaction of the Obligations without prejudice to its rights under this
Pledge.
14. Continuing Security Interest; Termination.
(a) This Pledge shall create a continuing security interest in
the Collateral and, unless terminated by operation of law, shall remain in
full force and effect and be binding upon Pledgor and the legal
representatives, successors and assigns of Pledgor until the Obligations
have been paid in full and shall be reinstated, as applicable, if at any
time payment or performance of the Obligations, or any part thereof, is
rescinded or reduced in amount or must otherwise be restored or returned
by any obligee of such Obligations all as though such payment or
performance had not been made.
(b) Upon the payment in full of the Obligations, the security
interest in the Collateral pursuant to this Pledge shall automatically
terminate without any further act of Pledgor or Lender being required, and
all rights to the Collateral as Lender may hold and shall revert to
Pledgor. Upon any such termination, Lender will return to Pledgor such of
the Collateral as shall not have not been sold or otherwise applied
pursuant to the terms hereof. In addition, Lender will execute,
acknowledge (where applicable) and deliver such satisfactions, releases
and termination statements as Pledgor shall reasonably request.
15. Notices. Except as otherwise expressly provided herein, all
notices, requests, demands or other communications provided for hereunder shall
be in writing and
-15-
mailed, transmitted via facsimile, or delivered via courier service: if to
Pledgor, at its address set forth in the first paragraph hereof, Attention:
General Counsel, facsimile: (000) 000-0000, with a copy to Leucadia National
Corporation, 000 Xxxx Xxxxxx Xxxxx, Xxx Xxxx, XX 00000, Attention: Xxx Xxxx,
facsimile (000) 000-0000; if to Lender, at its address set forth in the first
paragraph hereof, with copy to White & Case LLP at 0000 Xxxxxx xx xxx Xxxxxxxx,
Xxx Xxxx, XX 00000, Attention: Xxxx Xxxxx, Esq. and Xxxxx Xxxxx, Esq., facsimile
(000) 000-0000; or at such other address as shall be designated by such party in
a written notice to the other parties hereto. All notices required or permitted
hereunder shall be given either by (a) personal delivery, (b) professional
expedited delivery service (postage prepaid), (c) facsimile (provided that a
confirmation copy immediately follows by any of the other methods of delivery
permitted herein), or (d) certified mail return receipt requested (postage
prepaid), and if so given, shall be deemed to have been given either at the time
of personal delivery, or, in the case of expedited delivery service, as of the
date of delivery or the date of attempted or refused delivery at the address or
in the manner provided herein, or, in the case of facsimile with confirmation as
required above, upon receipt or, in the case of certified mail, five (5)
Business Days after posting with the U.S. Postal Service.
16. Marshalling. Lender shall not be required to marshal any present
or future security for (including but not limited to this Pledge), or guaranties
of, the Obligations or any of them, or to resort to such security or guaranties
in any particular order; and all of the rights of Lender hereunder and in
respect of such security and guaranties shall be cumulative and in addition to
all other rights, however existing or arising. To the extent that it lawfully
may, Pledgor hereby agrees that it will not invoke any law relating to the
marshaling of collateral which might cause delay in or impede the enforcement of
Lender's rights under this Pledge or the Second Equitable Mortgage and, to the
extent that it lawfully may, Pledgor hereby irrevocably waives the benefits of
all such laws.
17. Pledgor's Obligations Not Affected. The obligations of Pledgor
hereunder shall remain in full force and effect without regard to, and shall not
be impaired by (a) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of Pledgor; (b) any exercise
or nonexercise, or any waiver, by Lender of any right, remedy, power or
privilege under or in respect of the Obligations or any security therefor
(including this Pledge); (c) any amendment to or modification of any instrument
(other than this Pledge) securing any of the Obligations; or (d) the taking of
additional security for, or any guaranty of, any of the Obligations or the
release or discharge or termination of any security or guaranty for any of the
Obligations; whether or not Pledgor shall have notice or knowledge of any of the
foregoing.
18. Instructions to Company. If an Event of Default has occurred and
is continuing which entitles Lender to receive Distributions with respect to the
Interest, Lender may give written notice to such effect to Company (with a copy
to Pledgor) and direct Company to make further Distributions with respect to the
Collateral directly to Lender. Pledgor hereby instructs Company to honor such
directions as Company may receive from Lender with respect to the payment of
Distributions, whether in cash or in kind, with respect to the Collateral. This
paragraph is intended to authorize Company to rely upon directions from Lender
and is not intended to confer any additional authority upon Lender beyond that
conferred elsewhere in this
-16-
Pledge or otherwise. Pledgor also directs Company not to transfer any of the
Collateral (other than pursuant to a transaction permitted under Paragraph 8(b))
without the consent of Lender, which consent Lender may grant or withhold in its
sole discretion. In addition, Pledgor agrees that, except in relation to the
Security Agreement, it will not transfer "control" (as defined in Section
8-106(c) of the Uniform Commercial Code of the State of New York) over the
Interests to any Person other than Lender, except pursuant to a transaction
permitted under Paragraph 8(b) or as expressly contemplated in the
Acknowledgment.
19. Miscellaneous.
(a) Severability. In the event any one or more of the
provisions contained in this Pledge or their application to any person or
circumstance shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision hereof, but this
Pledge shall be construed as if such invalid, illegal or unenforceable
provision had never been contained herein.
(b) Successors and Assigns. This Pledge is binding upon and
inures to the benefit of Pledgor and Lender and their respective
successors and permitted assigns. Pledgor shall not voluntarily, or by
operation of law, assign or transfer any interest which it may have under
this Pledge without the prior written approval of Lender. Lender may
assign or otherwise transfer all or any portion of its rights hereunder to
any other person or entity, and such other person or entity shall
thereupon become vested with all of the benefits granted to Lender herein.
The Pledgor agrees to deliver to the Lender or its nominee an opinion of
Atanaskovic Hartnell or another law firm reasonably acceptable to Lender
(at the Pledgor's sole cost and expense) addressed to any successor or
assign of Lender, opining as to the enforceability of the Second Equitable
Mortgage, and such other matters incident to the transactions contemplated
thereby, which opinion shall be in form and substance reasonably
satisfactory to the Lender.
(c) Entire Agreement; Amendment. This Pledge and the other
documents, instruments and/or agreements contemplated hereby (including
without limitation, the Intercreditor Agreement) embody the final, entire
agreement among the parties hereto and supersede any and all prior
commitments, agreements, representations, and understandings, whether
written or oral, relating to the subject matter hereof and thereof and may
not be contradicted or varied by evidence of prior, contemporaneous, or
subsequent oral agreements or discussions of the parties hereto. All prior
agreements and understandings, oral or written, are merged into this
Pledge and the other documents, instruments and/or agreements contemplated
hereby. No provision of this Pledge may be changed, waived, discharged or
terminated orally or by any other means except an instrument in writing
signed by the party against whom enforcement of the change, waiver,
discharge or termination is sought.
(d) Captions. The captions or headings of the paragraphs in
this Pledge are for convenience of reference only and shall not control or
affect the meaning or construction of any of the terms or provisions
hereof.
-17-
(e) Jurisdiction; Venue. Pledgor irrevocably consents to the
jurisdiction of the State and Federal Courts of New York located in New
York City (a "NEW YORK FORUM") in any and all actions and proceedings
whether arising hereunder or under any other Loan Document, and
irrevocably agrees to service or process by certified mail, return receipt
requested, to the address of Pledgor set forth herein. Pledgor affirms and
covenants that this agreement is a knowing, voluntary and conscious
decision made by Pledgor with full advice of counsel. Pledgor (i) waives
and shall not interpose any objections of forum non conveniens, or to
venue, (ii) waives any right to seek to remove any proceeding commenced by
Lender in any New York Forum to any other forum or venue, and (iii) waives
any right to object to Lender seeking to remove to a New York Forum any
proceeding commenced by Pledgor in any forum or venue other than a New
York Forum.
(f) No Waiver. No failure or delay on the part of Lender in
exercising any power or right hereunder or under the Second Equitable
Mortgage shall operate as a waiver thereof or a waiver of any other term,
provision or condition hereof, nor shall any single or partial exercise of
any such right or power preclude any other or further exercise thereof or
the exercise of any other right or power hereunder. All rights and
remedies of Lender hereunder and under the Second Equitable Mortgage are
cumulative and shall not be deemed exclusive of any other rights or
remedies provided by law, or in any other Loan Documents.
(g) Counterparts. This Pledge may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an
original, and all such counterparts shall together constitute one and the
same instrument. An original executed counterpart delivered by facsimile
shall be deemed to be an original executed counterpart for all purposes
hereunder.
(h) Governing Law. This Pledge and the Acknowledgment shall be
governed by, and construed and enforced in accordance with the laws of the
State of New York, without reference to conflicts of laws principles. To
the fullest extent permitted by applicable law, Pledgor hereby
unconditionally and irrevocably waives any claim to assert that the laws
of any other jurisdiction govern this Pledge, and Pledgor affirms,
warrants and covenants that this agreement is a knowing, voluntary and
conscious decision made by Pledgor with full advice of counsel.
(i) Security Agreement. This Pledge is intended to constitute
and is a "security agreement" under the Uniform Commercial Code of the
State of New York.
(j) Costs and Expenses. Pledgor agrees to pay any and all
costs and expenses reasonably incurred by Lender upon the occurrence and
during the continuance of an Event of Default in enforcing any rights or
remedies under this Pledge and/or the Second Equitable Mortgage
(including, without limitation, court costs, reasonable attorneys' fees
and disbursements) and any such costs or expenses paid or incurred by
Lender shall accrue interest at the Default Rate from the date paid or
incurred by Lender until the date repaid by or on behalf of Pledgor.
-18-
(k) Certain Rights and Remedies. Lender may exercise its
rights and remedies under the Uniform Commercial Code and/or otherwise
under this Pledge and/or the Second Equitable Mortgage or pursuant to law
or equity, it being expressly agreed that Lender may, at its sole option,
exercise such right with respect to less than all of the Collateral, as
Lender elects in its sole discretion, leaving unexercised its rights with
respect to the remainder of the Collateral and in such order as Lender
shall determine in its sole discretion; provided, however, that such
partial exercise (or priority of exercise) shall in no way restrict or
jeopardize Lender's right to exercise its right with respect to all or
another portion of the remainder of the Collateral at a later time or
times.
(l) Application. If Lender either receives any amounts in
connection with the sale of the Collateral or any proceeds of the
Collateral, such sums shall be applied against the Obligations as Lender
may determine in its sole discretion.
(m) Intercreditor Agreement; First Equitable Mortgage. This
Pledge, including without limitation the exercise of any rights and
remedies (including voting rights) specified in Paragraphs 10, 11, 12 and
18 hereof, shall be subject in all respects to the terms and conditions of
the Intercreditor Agreement. In the event of any inconsistency or conflict
between the terms of this Pledge or the Acknowledgment on the one hand,
and the terms of the Intercreditor Agreement on the other hand, the terms
of the Intercreditor Agreement shall govern. In the event of any
inconsistency or conflict between the terms of this Pledge and the Second
Equitable Mortgage, the terms of this Pledge shall govern.
[SIGNATURE PAGE FOLLOWS]
-19-
IN WITNESS WHEREOF, this Pledge has been executed by the parties as of the
date first above written.
PLEDGOR:
CG AUSTRIA, INC.,
a Delaware corporation
By: /s/ XXXXXX X. XXXXXX
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Treasurer
LENDER:
XXXXXXXX HEADQUARTERS BUILDING
COMPANY, a Delaware corporation
By: /s/ XXXX X. HUSBAND
------------------------------
Name: Xxxx X. Husband
Title: Vice President
The undersigned hereby acknowledges and agrees to recognize the terms and
provisions of this Pledge and the security interest and other rights granted to
Lender herein:
WILTEL COMMUNICATIONS PTY. LIMITED,
an Australian corporation
By: /s/ XXXXXX X. XXXXXX
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
EXHIBIT A
Acknowledgment, Consent And Agreement Of
WILTEL COMMUNICATIONS PTY. LIMITED
WILTEL COMMUNICATIONS PTY. LIMITED in its role as issuer of the
Interests (the "COMPANY"), subject in each case to the Intercreditor Agreement,
the Security Agreement and the First Equitable Mortgage, (i) acknowledges
receipt of and consents to the terms and provisions of (a) the Pledge Agreement
dated as of November 27, 2002 (the "PLEDGE AGREEMENT") to which this
Acknowledgment, Consent and Agreement is attached (terms used herein not defined
herein shall have the meanings ascribed to such terms in the Pledge Agreement)
and (b) the Second Equitable Mortgage; (ii) agrees to pay Distributions with
respect to the Interests in accordance with the directions of Lender with the
consent of the Administrative Agent pursuant to the Intercreditor Agreement, the
Security Agreement and the First Equitable Mortgage following the occurrence and
during the continuance of an Event of Default; (iii) acknowledges that the grant
of the security interest under the Pledge Agreement and under the Second
Equitable Mortgage has been registered on the books and records of the Company
and agrees not to transfer any of the Interests without the consent of Lender,
except to the extent such consent is not required pursuant to Paragraph 8(b) of
the Pledge; (iv) agrees that it will comply with instructions regarding the
Collateral originated by Lender following the occurrence and during the
continuance of an Event of Default without the further consent of the registered
owner of the Interests, including CG Austria, Inc. ("OWNER"); (v) agrees that it
will not comply or agree to comply with instructions regarding the Collateral
originated by any person other than the Owner, Lender, the Administrative Agent
pursuant to the Security Agreement, the First Equitable Mortgage and the
Intercreditor Agreement, any applicable Governmental Authority or a court of
competent jurisdiction; (vi) agrees that unless and until payment in full of the
Obligations it will not register any person other than Owner as the registered
owner of the Interest, unless otherwise directed by the Administrative Agent
pursuant to the Security Agreement and the First Equitable Mortgage or Lender
with the consent of the Administrative Agent pursuant to the Security Agreement
and the First Equitable Mortgage; (vii) agrees that Lender does not undertake
any obligations or liabilities of any nature whatsoever arising from the
Company's Articles of Association or pertaining to the organization, formation,
creation, operation or conduct of the Company or of any of its constituents
solely by reason of the Pledge Agreement or the exercise of its rights
thereunder; (viii) agrees that Lender will not by reason of the Pledge Agreement
and/or the Second Equitable Mortgage or the exercise of its rights thereunder be
liable to any person, firm, corporation or entity for any injury or damages of
any nature whatsoever sustained by reason of any act of omission or commission
of the Company or any of its constituents or by reason of the grant of the
security interest in the Collateral, except in each case to the extent any
injury or damage is caused by Lender's gross negligence or willful misconduct;
(ix) agrees, notwithstanding any provision in the Company's organizational
documents or the Shareholders Agreement, not to take any action to (or fail to
take any action which failure would have such effect) terminate, dilute, impair
or otherwise adversely affect in any material respect Lender's legal rights,
remedies or interests under the Pledge Agreement or the Second Equitable
Mortgage (provided that the Company shall not be in default of such obligation
(x) if the Company, in exercising its reasonable business judgment, acts in good
faith with due regard to the terms thereof and the interests of Lender
thereunder or (y) if the Company enters into and consummates a transaction
permitted under Paragraph 8(b) of the Pledge) or under any document, instrument
or agreement executed in reliance on the Pledge Agreement or the Second
Equitable Mortgage and to amend (in form and substance reasonably satisfactory
to Lender) its organizational documents and any other relevant documents to
Exhibit A
Page 2
similarly so provide and to preclude any such action or inaction having such
effect, and to use all reasonable efforts to obtain all necessary consents and
perform such other actions which are a prerequisite to such amendments and to
otherwise comply with Lender's reasonable requests to ensure that the Company is
a special purpose entity (the purpose and/or activities of which shall be
limited to owning the stock of PowerTel) and that Lender's security interest in
the Collateral is not adversely affected by any action or inaction of Pledgor or
the Company; (x) acknowledges that the pledge by Owner and the security interest
of Lender under the Pledge Agreement is subject and subordinate to the security
interest granted to the Administrative Agent pursuant to the Security Agreement
and the First Equitable Mortgage, pursuant to the terms of the Intercreditor
Agreement; and (xi) agrees that, notwithstanding anything to the contrary
contained in the Shareholders Agreement or the Company's organizational
documents in the event Lender exercises its remedies under the Pledge Agreement
and/or the Second Equitable Mortgage and forecloses or otherwise realizes on the
Collateral and sells the Interests, the purchaser of such Interest will
automatically become a shareholder in the Company.
Dated as of: WILTEL COMMUNICATIONS PTY. LIMITED,
November 27, 2002 an Australian corporation
By: /s/ XXXXXX X. XXXXXX
-------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
