Exhibit 10.29
GNE INVESTMENTS, INC. PLEDGE AGREEMENT
(IN FAVOR OF THE COLLATERAL AGENT)
THIS PLEDGE AGREEMENT, dated as of June 17, 2002 (this "AGREEMENT") between GNE
Investments, Inc., a Washington corporation (the "PLEDGOR") and The Bank of New
York in its capacity as trustee (in such capacity, the "TRUSTEE") and collateral
agent (in such capacity, the "COLLATERAL AGENT") under the Indenture referred to
below.
WHEREAS:
(A) Pursuant to the terms, conditions and provisions of the Indenture dated as
of the date hereof (as it may be amended, restated, supplemented or
otherwise modified and in effect from time to time, the "INDENTURE") among
H&E Equipment Services L.L.C., a Louisiana limited liability company
("H&E"), H&E Finance Corp., a Delaware corporation (together with H&E, each
individually an "ISSUER" and collectively the "ISSUERS"), the Pledgor, as a
guarantor, the other guarantors named therein and the Collateral Agent, the
Issuers are issuing, as of the date hereof $200,000,000 of 11?% Senior
Secured Notes due 2012, and may, from time to time, issue additional notes
in accordance with the provisions of the Indenture (collectively, the
"NOTES");
(B) Pursuant to that certain GNE Investments, Inc. Pledge Agreement dated as of
the date hereof by the Pledgor in favor of General Electric Capital
Corporation, as collateral agent for the secured parties therein (the
"CREDIT AGREEMENT AGENT") (such document, as amended, modified or
supplemented from time to time, the "PRIORITY PLEDGE AGREEMENT"), the
Pledgor has pledged to the Credit Agreement Agent, and granted the Credit
Agreement Agent a security interest in, the Pledged Collateral (as defined
below) pursuant to the Credit Agreement dated as of June 17, 2002 (as it
may be amended, restated, supplemented or otherwise modified and in effect
from time to time, the "CREDIT AGREEMENT") among H&E, Great Northern
Equipment, Inc., a Montana corporation (together with the Pledgor, each
individually, a "BORROWER", and collectively, and jointly and severally,
the "BORROWERS"), the other Persons named therein as lenders from time to
time (the "LENDERS"), the Pledgor, as a credit party, together with the
other Persons named therein as credit parties (the "CREDIT PARTIES"),
Credit Agreement Agent, as Arranger, Bank of America, N.A., as Syndication
Agent and Fleet Capital Corporation, as Documentation Agent, the Lenders
have agreed to make available to Borrowers, upon the terms and conditions
thereof, certain revolving credit facilities;
(C) In order to induce the Trustee to enter into the Indenture and the Initial
Purchasers to purchase the Notes, the Pledgor, pursuant to the terms of the
Indenture, has agreed to pledge to the Collateral Agent, and grant the
Collateral Agent a security interest in, the Pledged Collateral (as defined
below) in accordance with this Agreement; and
(D) To the extent and upon the terms set forth in Article 10 of the Indenture,
(i) the Liens granted by this Agreement as security for the Secured
Obligations (as defined below) upon any and all of the Pledged Collateral
(as defined below) are subordinate in ranking to all present and future
Priority Liens upon any and all of the Pledged Collateral; and (ii) the
Note Liens upon any and all Pledged Collateral will be of equal ranking
with all present and future Parity Liens.
NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained and in order to induce the Trustee to enter into the Indenture and the
Initial Purchasers to purchase the Notes, the Pledgor hereby agrees with the
Trustee as the Collateral Agent for the benefit of all the present and future
Holders of Secured Obligations (as defined below) as follows:
1. DEFINITIONS
Unless otherwise defined herein, terms defined in the Indenture are used
herein as therein defined, and the following shall have (unless otherwise
provided elsewhere in this Agreement) the following respective meanings
(such meanings being equally applicable to both the singular and plural
form of the terms defined):
"BANKRUPTCY CODE" means title 11, United States Code, as amended from time
to time, and any successor statute thereto;
"GOVERNMENTAL AUTHORITY" means any nation or government, any state or other
political subdivision thereof, and any agency, department or other entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government;
"HOLDERS OF SECURED OBLIGATIONS" means the Holders of Notes and all other
Persons who at any time hold or acquire any interest in, or any right to
enforce, any of the Secured Obligations;
"PLEDGED COLLATERAL" has the meaning assigned to such term in Section 2
hereof;
"PLEDGED ENTITY" means the issuer of Pledged Shares or Pledged
Indebtedness;
"PLEDGED INDEBTEDNESS" means the Indebtedness evidenced by promissory notes
and instruments listed on Part B of Schedule I hereto;
"PLEDGED SHARES" means those shares of Stock listed on Part A of Schedule I
hereto;
"SPECIFIED PRIORITY LIEN" means the Lien on the Pledged Collateral granted
by the Pledgor to the Credit Agreement Agent for the benefit of the Lenders
under the Priority Pledge Agreement which Lien has priority to the Lien
hereof to the extent and on the terms set forth in Article 10 of the
Indenture; and
"SECURED OBLIGATIONS" means all liability of the Pledgor, whenever incurred
or arising, under, for or in respect of the Notes, the Subsidiary
Guarantees and any and all other present and future Note Obligations.
"STOCK" means all shares, options, warrants, general or limited partnership
interests, membership interests or other equivalents (regardless of how
designated) of or in a corporation, partnership, limited liability company
or equivalent entity whether voting or nonvoting, including common stock,
preferred stock or any other "equity security" (as such term is defined in
Rule 3a11-1 of the General Rules and Regulations promulgated by the
Securities and Exchange Commission (the "COMMISSION") under the Securities
Exchange Act of 1934).
2. PLEDGE
The Pledgor hereby pledges to the Trustee as the Collateral Agent for the
benefit of all the present and future Holders of Secured Obligations, and
grants to the Trustee as the Collateral Agent for the benefit of all the
present and future Holders of Secured Obligations, a security interest in
all of the following (collectively, the "PLEDGED COLLATERAL"):
(a) (i) the Pledged Shares and the certificates representing the Pledged
Shares, (ii) all options, warrants, shares and/or other securities,
shares of stock, certificates, instruments or other documents
representing the Pledged Shares and (iii) all dividends,
distributions, cash, instruments and other property or proceeds from
time to time received, receivable or otherwise distributed in respect
of or in exchange for any or all of the Pledged Shares;
(b) any additional shares of stock of the Pledged Entity from time to time
acquired by the Pledgor in any manner (which shares shall be deemed to
be part of the Pledged Shares), and the certificates representing such
additional shares, and all dividends, distributions, bonus issues,
offers by way of rights allotments, cash, instruments, compensation,
assets and other property or proceeds from time to time received,
receivable or otherwise distributed in respect of or in exchange for
any or all of such Stock;
(c) the Pledged Indebtedness and the promissory notes or instruments
evidencing the Pledged Indebtedness, and all interest, cash,
instruments and other property and assets from time to time received,
receivable or otherwise distributed in respect of the Pledged
Indebtedness;
(d) all additional Indebtedness arising after the date hereof and owing to
the Pledgor and evidenced by promissory notes or other instruments,
together with such promissory notes and instruments, and all interest,
cash, instruments and other property and assets from time to time
received, receivable or otherwise distributed in respect of that
Pledged Indebtedness; and
(e) all proceeds of every kind, including proceeds of proceeds, of any and
all of the foregoing (including, without limitation, proceeds which
constitute property of the type described above) and to the extent not
otherwise included, all money and cash.
3. SECURITY FOR OBLIGATIONS
This Agreement secures, and the Pledged Collateral is security for, the
prompt payment in full when due, whether at stated maturity, by
acceleration or otherwise, and performance of all of the Secured
Obligations.
4. DELIVERY OF PLEDGED COLLATERAL
Upon, and concurrently with, the Discharge of Priority Lien Indebtedness,
without notice or demand: (i) the Pledgor shall deliver, or shall cause
Credit Agreement Agent to deliver, all certificates and all promissory
notes and instruments evidencing the Pledged Collateral owned by the
Pledgor and all other warrants, shares and/or other securities, original
shares of stock, certificates, instruments or other documents, in each case
evidencing or representing title to other Pledged Collateral to the
Collateral Agent; and (ii) all such Pledged Shares shall be accompanied by
duly executed instruments of transfer or assignment in blank, all in form
and substance satisfactory to the Collateral Agent and all promissory notes
or other instruments evidencing any such Pledged Indebtedness shall be
endorsed by the Pledgor, and, if necessary, the Credit Agreement Agent
(which may endorse without recourse or warranty); PROVIDED, that if the
Pledged Entity's constitutive documents contain a restriction on the right
to transfer its shares then, in order to better perfect the Collateral
Agent's security in any such Pledged Shares of such Pledged Entity, the
certificates evidencing those Pledged Shares shall be registered in the
Collateral Agent's name or, at the Collateral Agent's option, the
Collateral Agent's nominees name, and shall be accompanied by a copy of the
share register of such Pledged Entity showing the Collateral Agent's name
or, at the Collateral Agent's option, the Collateral Agent's nominee's
name, as the registered owner of those Pledged Shares of such Pledged
Entity, certified by the corporate secretary of such Pledged Entity as
being true and complete.
5. REPRESENTATIONS AND WARRANTIES
The Pledgor represents and warrants to the Collateral Agent that:
(a) The Pledgor is, and at the time of delivery of the Pledged Shares to
Credit Agreement Agent will be, the sole holder of record (unless at
the time of delivery of such Pledged Shares to Credit Agreement Agent,
such Pledged Shares are registered in Credit Agreement Agent's or, at
Credit Agreement Agent's option, Credit Agreement Agent's nominee's
name, in which case the Pledgor was the sole holder of record of such
Pledged Shares immediately prior to registration in Credit Agreement
Agent's or Credit Agreement Agent's nominee's name, as applicable) and
the sole beneficial owner of such Pledged Collateral pledged by the
Pledgor free and clear of any Lien thereon or affecting the title
thereto, except for any Lien created by this Agreement and any
Permitted Lien (including any Specified Priority Lien); the Pledgor is
and at the time of delivery of the instruments or certificates
evidencing the Pledged Indebtedness to Credit Agreement Agent will be,
the sole beneficial owner of such Pledged Collateral free and clear of
any Lien thereon or affecting title thereto, except for any Lien
created by this Agreement and any Permitted Lien;
(b) all of the Pledged Shares have been duly authorized, validly issued
and are fully paid and non-assessable; the Pledged Indebtedness has
been duly authorized, authenticated or issued and delivered by, and is
the legal, valid and binding obligations of, the Pledged Entity, and
the Pledged Entity is not in default thereunder;
(c) the Pledgor has the right and requisite authority to pledge, assign,
transfer, deliver, deposit and set over the Pledged Collateral pledged
by the Pledgor to the Credit Agreement Agent and the Collateral Agent
as provided herein;
(d) none of the Pledged Shares or Pledged Indebtedness has been issued or
transferred in violation of the securities registration, securities
disclosure or similar laws of any jurisdiction to which such issuance
or transfer may be subject;
(e) all of the Pledged Shares are presently owned by the Pledgor, and are
presently represented by the certificates listed on Part A of
Schedule I hereto and the Pledged Collateral constitutes, and so long
as this Agreement remains in effect will continue to constitute, 100%
of the equity interests (whether options, warrants or stock or
otherwise) held by the Pledgor in the Pledged Entity. As of the date
hereof, there are no existing options, warrants, calls or commitments
of any character whatsoever relating to the Pledged Shares;
(f) no consent, approval, authorization or other order or other action by,
and no notice to or filing with, any Governmental Authority or any
other Person is required (i) for the pledge by the Pledgor of the
Pledged Collateral pursuant to this Agreement or for the execution,
delivery or performance of this Agreement by the Pledgor, or (ii) for
the exercise by Credit Agreement Agent or by the Collateral Agent of
the voting or other rights provided for in this Agreement or the
remedies in respect of the Pledged Collateral pursuant to this
Agreement, except as may be required in connection with such
disposition by laws affecting the offering and sale of securities
generally and except as may be generally applicable to Credit
Agreement Agent or the Collateral Agent;
(g) the pledge, assignment and delivery of the Pledged Collateral pursuant
to this Agreement will create a valid second priority Lien on and a
second priority perfected security interest in favor of the Trustee as
the Collateral Agent for the benefit of all the present and future
Holders of Secured Obligations in the Pledged Collateral and the
proceeds thereof, securing the payment of the Secured Obligations,
subject to no other Lien (other than the Specified Priority Lien);
(h) as at the date hereof, the Pledged Shares constitute 100% of the
issued and outstanding shares of common Stock of the Pledged Entity;
and
(i) except as disclosed on Part B of Schedule I, none of the Pledged
Indebtedness is subordinated in right of payment to other Indebtedness
(except for the Priority Lien and the Secured Obligations) or subject
to the terms of an indenture.
The representations and warranties set forth in this Section 5 shall
survive the execution and delivery of this Agreement.
6. COVENANTS
The Pledgor covenants and agrees that until the payment and performance in
full of the Secured Obligations:
(a) The Pledgor will not sell, assign, transfer, pledge, or otherwise
encumber any of its rights in or to the Pledged Collateral, or any
unpaid dividends, interest or other distributions or payments with
respect to the Pledged Collateral or xxxxx x Xxxx in the Pledged
Collateral, unless otherwise expressly permitted by the Indenture;
(b) The Pledgor will, at its expense, promptly execute, acknowledge and
deliver all such instruments and take all such actions as the
Collateral Agent from time to time may reasonably request in order to
ensure to the Trustee, the Collateral Agent and all the present and
future Holders of Secured Obligations the benefits of the Liens in and
to the Pledged Collateral intended to be created by this Agreement,
including the filing of any necessary Uniform Commercial Code
financing statements, which may be filed by the Collateral Agent with
or (to the extent permitted by law) without the signature of the
Pledgor, and will cooperate with the Collateral Agent, at the
Pledgor's expense, in obtaining all necessary approvals and making all
necessary filings under federal, state, local or foreign law in
connection with such Liens or any sale or transfer of the Pledged
Collateral;
(c) The Pledgor has and will defend the title to the Pledged Collateral
and the Liens of the Collateral Agent for the benefit of the present
and future Holders of Secured Obligations in the Pledged Collateral
against the claim of any Person other than the holders of Specified
Priority Liens and will maintain and preserve Liens of the Collateral
Agent; and
(d) Upon, and concurrently with, the Discharge of Priority Lien
Indebtedness, without notice or demand the Pledgor will, upon
obtaining ownership of any additional Stock or promissory notes or
instruments of the Pledged Entity or Stock or promissory notes or
instruments otherwise required to be pledged pursuant to any of the
Note Documents or the Priority Pledge Agreement, which Stock, notes or
instruments are not already Pledged Collateral, promptly (and in any
event within three (3) Business Days) deliver to the Collateral Agent
a Pledge Amendment, duly executed by the Pledgor, in substantially the
form of Schedule II hereto (a "PLEDGE AMENDMENT") in respect of any
such additional Stock, notes or instruments, pursuant to which the
Pledgor shall pledge to the Collateral Agent all of such additional
Stock, notes and instruments; PROVIDED, HOWEVER, that (i) in
no event shall the Pledgor be required to pledge to the Collateral
Agent shares of Stock of an entity organized under the laws of
a jurisdiction outside the United States which represent more than 65%
of the voting power of all classes of issued and outstanding shares of
such entity which are entitled to vote; and (ii) prior to the
Discharge of Priority Lien Indebtedness, such additional Stock, notes
or instruments need not be delivered to the Collateral Agent so long
as they are held by the Credit Agreement Agent. The Pledgor hereby
authorizes the Collateral Agent to attach each Pledge Amendment to
this Agreement and agrees that all Pledged Shares and Pledged
Indebtedness listed on any Pledge Amendment delivered to the
Collateral Agent shall for all purposes hereunder be considered
Pledged Collateral.
7. THE PLEDGOR'S RIGHTS
As long as no Event of Default shall have occurred and be continuing and
until written notice shall be given to the Pledgor in accordance with
Section 8(a) hereof:
(a) The Pledgor shall have the right, from time to time, to vote and give
consents with respect to the Pledged Collateral, or any part thereof
for all purposes not inconsistent with the provisions of this
Agreement and the other Note Documents; PROVIDED, HOWEVER, that no
vote shall be cast, and no consent shall be given or action taken,
which would have the effect of impairing the position or interest of
the Collateral Agent in respect of the Pledged Collateral or which
would authorize, effect or consent to (unless and to the extent
expressly permitted by the Indenture), or to the extent that the
consummation of the transaction is conditional upon the payment in
full in cash of the Note Obligations:
(i) the dissolution or liquidation, in whole or in part, of the
Pledged Entity;
(ii) the consolidation or merger of the Pledged Entity with any
other Person;
(iii) the sale, disposition or encumbrance of all or substantially
all of the assets of the Pledged Entity, except for Liens in
favor of the Credit Agreement Agent pursuant to the Priority
Pledge Agreement or the Collateral Agent pursuant to the terms
hereof;
(iv) any change in the authorized number of shares, the stated
capital or the authorized share capital of the Pledged Entity
or the issuance of any additional shares of its Stock; or
(v) the alteration of the voting rights with respect to the Stock
of the Pledged Entity; and
(b) (i) The Pledgor shall be entitled, from time to time, to
collect and receive for its own use all cash dividends and
interest paid in respect of the Pledged Shares and Pledged
Indebtedness to the extent not in violation of the Indenture
other than any and all: (A) dividends and interest paid or
payable other than in cash in respect of any Pledged
Collateral, and instruments and other property received,
receivable or otherwise distributed in respect of, or in
exchange for, any Pledged Collateral; (B) dividends and other
distributions paid or payable in cash in respect of any Pledged
Shares in connection with a partial or total liquidation or
dissolution or in connection with a reduction of capital,
capital surplus or paid-in capital of the Pledged Entity; and
(C) cash paid, payable or otherwise distributed, in respect of
principal of, or in redemption of, or in exchange for, any
Pledged Collateral; PROVIDED, HOWEVER, that until actually paid
all rights to such distributions shall remain subject to the
Lien created by this Agreement; and
(ii) all dividends and interest (other than such cash dividends and
interest as are permitted to be paid to the Pledgor in
accordance with clause (i) above) and all other distributions
in respect of any of the Pledged Shares or Pledged
Indebtedness, whenever paid or made, shall be delivered to
Collateral Agent to hold as Pledged Collateral and shall, if
received by the Pledgor, be received in trust for the benefit
of Collateral Agent, be segregated from the other property or
funds of the Pledgor, and be forthwith delivered to Collateral
Agent as Pledged Collateral in the same form as so received
(with any necessary indorsement); PROVIDED that until the
Discharge of Priority Lien Indebtedness, such dividends,
interest and distributions need not be delivered to the
Collateral Agent so long as they are held by the Credit
Agreement Agent and may also be held in trust for the Credit
Agreement Agent and need not be delivered to the Collateral
Agent so long as they are held in trust for the Collateral
Agreement Agent.
8. DEFAULTS AND REMEDIES; PROXY
(a) Subject to Article 10 of the Indenture: (i) upon the occurrence of an
Event of Default and during the continuation of such Event of Default,
and concurrently with written notice to the Pledgor, the Collateral
Agent (personally or through an agent) is hereby authorized and
empowered to transfer and register in its name or in the name of its
nominee the whole or any part of the Pledged Collateral, to exchange
certificates or instruments representing or evidencing Pledged
Collateral for certificates or instruments of smaller or larger
denominations, to exercise the voting and all other rights as a holder
with respect thereto, to collect and receive all cash dividends,
interest, principal and other distributions made thereon, to sell in
one or more sales after ten (10) days' notice of the time and place of
any public sale or of the time at which a private sale is to take
place (which notice the Pledgor agrees is commercially reasonable) the
whole or any part of the Pledged Collateral and to otherwise act with
respect to the Pledged Collateral as though the Collateral Agent was
the outright owner thereof; (ii) any sale shall be made at a public or
private sale at the Collateral Agent's place of business, or at any
place to be named in the notice of sale, either for cash or upon
credit or for future delivery at such price as the Collateral Agent
may deem fair, and the Collateral Agent may be the purchaser of the
whole or any part of the Pledged Collateral so sold and hold the same
thereafter in its own right free from any claim of the Pledgor or any
right of redemption; (iii) each sale shall be made to the highest
bidder, but the Collateral Agent reserves the right to reject any and
all bids at such sale which, in its discretion, it shall deem
inadequate; (iv) demands of performance, except as otherwise herein
specifically provided for, notices of sale, advertisements and the
presence of property at sale are hereby waived and any sale hereunder
may be conducted by an auctioneer or any officer or agent of the
Collateral Agent; (v) THE PLEDGOR HEREBY IRREVOCABLY CONSTITUTES AND
APPOINTS THE COLLATERAL AGENT AS THE PROXY AND ATTORNEY-IN-FACT OF THE
PLEDGOR WITH RESPECT TO THE PLEDGED COLLATERAL FOR THE PURPOSE OF
CARRYING OUT THE TERMS OF THIS AGREEMENT, INCLUDING THE RIGHT TO VOTE
THE PLEDGED SHARES, WITH FULL POWER OF SUBSTITUTION TO DO SO; (vi) THE
APPOINTMENT OF THE
COLLATERAL AGENT AS PROXY AND ATTORNEY-IN-FACT IS COUPLED WITH AN
INTEREST AND SHALL BE IRREVOCABLE UNTIL THE TERMINATION DATE; (vii) IN
ADDITION TO THE RIGHT TO VOTE THE PLEDGED SHARES, THE APPOINTMENT OF
THE COLLATERAL AGENT AS PROXY AND ATTORNEY-IN-FACT SHALL INCLUDE THE
RIGHT TO EXERCISE ALL OTHER RIGHTS, POWERS, PRIVILEGES AND REMEDIES TO
WHICH A HOLDER OF THE PLEDGED SHARES WOULD BE ENTITLED (INCLUDING
GIVING OR WITHHOLDING WRITTEN CONSENTS OF SHAREHOLDERS, CALLING
SPECIAL MEETINGS OF SHAREHOLDERS AND VOTING AT SUCH MEETINGS); (viii)
SUCH PROXY AND POWER OF ATTORNEY SHALL BE EFFECTIVE, AUTOMATICALLY AND
WITHOUT THE NECESSITY OF ANY ACTION (INCLUDING ANY TRANSFER OF ANY
PLEDGED SHARES ON THE RECORD BOOKS OF THE ISSUER THEREOF) BY ANY
PERSON (INCLUDING THE ISSUER OF THE PLEDGED SHARES OR ANY OFFICER OR
AGENT THEREOF), UPON THE OCCURRENCE AND DURING THE CONTINUANCE OF AN
EVENT OF DEFAULT (AS DEFINED IN THE INDENTURE); AND (ix)
NOTWITHSTANDING THE FOREGOING, THE COLLATERAL AGENT SHALL NOT HAVE ANY
DUTY TO EXERCISE ANY SUCH RIGHT OR TO PRESERVE THE SAME AND SHALL NOT
BE LIABLE FOR ANY FAILURE TO DO SO OR FOR ANY DELAY IN DOING SO.
(b) Subject to Article 10 of the Indenture: if, at the original time or
times appointed for the sale of the whole or any part of the Pledged
Collateral, the highest bid, if there be but one sale, shall be
inadequate to discharge in full all the Priority Lien Obligations and
the Secured Obligations, or if the Pledged Collateral be offered for
sale in lots, if at any of such sales, the highest bid for the lot
offered for sale would indicate to the Collateral Agent, in its
discretion, that the proceeds of the sales of the whole of the Pledged
Collateral would be unlikely to be sufficient to discharge all the
Priority Lien Obligations and the Secured Obligations, the Collateral
Agent may, on one or more occasions and in its discretion, postpone
any of said sales by public announcement at the time of sale or the
time of previous postponement of sale, and no other notice of such
postponement or postponements of sale need be given, any other notice
being hereby waived; PROVIDED, HOWEVER, that any sale or sales made
after such postponement shall be after ten (10) days' notice to the
Pledgor.
(c) Subject to Article 10 of the Indenture: if, at any time when the
Collateral Agent in its sole discretion reasonably determines,
following the occurrence and during the continuance of an Event of
Default, that, in connection with any actual or contemplated exercise
of its rights (when permitted under this Section 8) to sell the whole
or any part of the Pledged Shares hereunder, it is necessary or
advisable to effect a public registration of all or part of the
Pledged Collateral pursuant to the Securities Act of 1933, as amended
(or any similar statute then in effect) (the "ACT"), the Pledgor
shall, in an expeditious manner, cause the Pledged Entity to:
(i) prepare and file with the Commission a registration statement
with respect to the Pledged Shares and in good faith use
commercially reasonable efforts to cause such registration
statement to become and remain effective;
(ii) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus
used in connection therewith as may be necessary to keep such
registration statement effective and to comply with the
provisions of the Act with respect to the sale or other
disposition of the Pledged Shares covered by such registration
statement whenever the Collateral Agent shall desire to sell or
otherwise dispose of the Pledged Shares;
(iii) furnish to the Collateral Agent such numbers of copies of a
prospectus and a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as the
Collateral Agent may request in order to facilitate the public
sale or other disposition of the Pledged Shares by the
Collateral Agent;
(iv) use commercially reasonable efforts to register or qualify the
Pledged Shares covered by such registration statement under
such other securities or blue sky laws of such jurisdictions
within the United States and Puerto Rico as the Collateral
Agent shall request, and do such other reasonable acts and
things as may be required of it to enable the Collateral Agent
to consummate the public sale or other disposition in such
jurisdictions of the Pledged Shares by the Collateral Agent;
(v) use its best efforts to furnish, at the request of the
Collateral Agent, on the date that shares of the Pledged
Collateral are delivered to the underwriters for sale pursuant
to such registration or, if the security is not being sold
through underwriters, on the date that the registration
statement with respect to such Pledged Shares becomes
effective, (A) an opinion, dated such date, of the independent
counsel representing such registrant for the purposes of such
registration, addressed to the underwriters, if any, and in the
event the Pledged Shares are not being sold through
underwriters, then to the Collateral Agent, in customary form
and covering matters of the type customarily covered in such
legal opinions; and (B) a comfort letter, dated such date, from
the independent certified public accountants of such
registrant, addressed to the underwriters, if any, and in the
event the Pledged Shares are not being sold through
underwriters, then to the Collateral Agent, in a customary form
and covering matters of the type customarily covered by such
comfort letters and as the underwriters or the Collateral Agent
shall reasonably request. The opinion of counsel referred to
above shall additionally cover such other legal matters with
respect to the registration in respect of which such opinion is
being given as the Collateral Agent may reasonably request. The
letter referred to above from the independent certified public
accountants shall additionally cover such other financial
matters (including information as to the period ending not more
than five (5) Business Days prior to the date of such letter)
with respect to the registration in respect of which such
letter is being given as the Collateral Agent may reasonably
request; and
(vi) otherwise use commercially reasonable efforts to comply with
all applicable rules and regulations of the Commission, and
make available to its security holders, as soon as reasonably
practicable but not later than 18 months after the effective
date of the registration statement, an earnings statement
covering the period of at least 12 months beginning with the
first full month after the effective date of such registration
statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Act.
(d) All expenses incurred in complying with Section 8(c) hereof,
including, without limitation, all registration and filing fees
(including all reasonable expenses incident to
filing with the National Association of Securities Dealers, Inc.),
printing expenses, reasonable fees and disbursements of counsel for
the registrant, the reasonable fees and expenses of counsel for the
Collateral Agent, expenses of the independent certified public
accountants (including any special audits incident to or required by
any such registration) and expenses of complying with the securities
or blue sky laws or any jurisdictions, shall be paid by the Pledgor.
(e) If, at any time when the Collateral Agent shall determine to exercise
its right to sell the whole or any part of the Pledged Collateral
hereunder, such Pledged Collateral or the part thereof to be sold
shall not, for any reason whatsoever, be effectively registered under
the Act, the Collateral Agent may, in its discretion (subject only to
applicable requirements of law), sell such Pledged Collateral or part
thereof by private sale in such manner and under such circumstances as
the Collateral Agent may deem necessary or advisable, but subject to
the other requirements of this Section 8, and shall not be required to
effect such registration or to cause the same to be effected. Without
limiting the generality of the foregoing, in any such event, the
Collateral Agent in its discretion (x) may, in accordance with
applicable securities laws, proceed to make such private sale
notwithstanding that a registration statement for the purpose of
registering such Pledged Collateral or part thereof could be or shall
have been filed under said Act (or similar statute), (y) may approach
and negotiate with a single possible purchaser to effect such sale,
and (z) may restrict such sale to a purchaser who is an accredited
investor under the Act and who will represent and agree that such
purchaser is purchasing for its own account, for investment and not
with a view to the distribution or sale of such Pledged Collateral or
any part thereof. In addition to a private sale as provided above in
this Section 8, if any of the Pledged Collateral shall not be freely
distributable to the public without registration under the Act (or
similar statute) at the time of any proposed sale pursuant to this
Section 8, then the Collateral Agent shall not be required to effect
such registration or cause the same to be effected but, in its
discretion (subject only to applicable requirements of law), may
require that any sale hereunder (including a sale at auction) be
conducted subject to restrictions:
(i) as to the financial sophistication and ability of any Person
permitted to bid or purchase at any such sale;
(ii) as to the content of legends to be placed upon any certificates
representing the Pledged Collateral sold in such sale,
including restrictions on future transfer thereof;
(iii) as to the representations required to be made by each Person
bidding or purchasing at such sale relating to that Person's
access to financial information about the Pledgor and such
Person's intentions as to the holding of the Pledged Collateral
so sold for investment for its own account and not with a view
to the distribution thereof; and
(iv) as to such other matters as the Collateral Agent may, in its
discretion, deem necessary or appropriate in order that such
sale (notwithstanding any failure so to register) may be
effected in compliance with the Bankruptcy Code and other laws
affecting the enforcement of creditors' rights and the Act and
all applicable state securities laws.
(f) The Pledgor recognizes that the Collateral Agent may be unable to
effect a public sale of any or all the Pledged Collateral and may be
compelled to resort to one or more private sales thereof in accordance
with clause (e) above. The Pledgor also acknowledges that any such
private sale may result in prices and other terms less favorable to
the seller than if such sale were a public sale and, notwithstanding
such circumstances, agrees that any such private sale shall not be
deemed to have been made in a commercially unreasonable manner solely
by virtue of such sale being private. The Collateral Agent shall be
under no obligation to delay a sale of any of the Pledged Collateral
for the period of time necessary to permit the Pledged Entity to
register such securities for public sale under the Act, or under
applicable state securities laws, even if the Pledgor and the Pledged
Entity would agree to do so.
(g) The Pledgor agrees to the maximum extent permitted by applicable law
that following the occurrence and during the continuance of an Event
of Default it will not at any time plead, claim or take the benefit of
any appraisal, valuation, stay, extension, moratorium or redemption
law now or hereafter in force in order to prevent or delay the
enforcement of this Agreement, or the absolute sale of the whole or
any part of the Pledged Collateral or the possession thereof by any
purchaser at any sale hereunder, and the Pledgor waives the benefit of
all such laws to the extent it lawfully may do so. The Pledgor agrees
that it will not interfere with any right, power and remedy of each of
the Collateral Agent provided for in this Agreement or now or
hereafter existing at law or in equity or by statute or otherwise, or
the exercise or beginning of the exercise by the Collateral Agent of
any one or more of such rights, powers or remedies. No failure or
delay on the part of the Collateral Agent to exercise any such right,
power or remedy and no notice or demand which may be given to or made
upon the Pledgor by the Collateral Agent with respect to any such
remedies shall operate as a waiver thereof, or limit or impair the
Collateral Agent's right to take any action or to exercise any power
or remedy hereunder, without notice or demand, or prejudice its rights
as against the Pledgor in any respect.
(h) The Pledgor further agrees that a breach of any of the covenants
contained in this Section 8 will cause irreparable injury to the
Collateral Agent and the present and future Holders of Secured
Obligations, that the Collateral Agent and the present and future
Holders of Secured Obligations shall have no adequate remedy at law in
respect of such breach and, as a consequence, agrees that each and
every covenant contained in this Section 8 shall be specifically
enforceable against the Pledgor, and the Pledgor hereby waives and
agrees not to assert any defenses against an action for specific
performance of such covenants except for a defense that the Secured
Obligations are not then due and payable in accordance with the
agreements and instruments governing and evidencing such obligations.
9. WAIVER
No delay on the Collateral Agent's part in exercising any power of sale,
Lien, option or other right hereunder, and no notice or demand which may be
given to or made upon the Pledgor by the Collateral Agent with respect to
any power of sale, Lien, option or other right hereunder, shall constitute
a waiver thereof, or limit or impair the Collateral Agent's right to take
any action or to exercise any power of sale, Lien, option, or any other
right hereunder, without notice or demand, or prejudice the Collateral
Agent's rights as against the Pledgor in any respect.
10. ASSIGNMENT
The Collateral Agent may assign all of its rights and delegate all of its
obligations hereunder to any successor Collateral Agent as provided in the
Indenture. The Collateral Agent and each Holder of Secured Obligations may
assign, indorse or transfer any instrument evidencing all or any part of
the Secured Obligations as provided in, and in accordance with, the
Indenture, and the holder of such instrument shall be entitled to the
benefits of this Agreement.
11. TERMINATION
The security interests granted hereby shall continue in full force and
effect until released in accordance with the provisions of the Indenture.
12. LIEN ABSOLUTE
All rights of the Collateral Agent for the benefit of the present and
future Holders of Secured Obligations hereunder, and all obligations of the
Pledgor hereunder, shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of the Indenture, any other
Note Document or any other agreement or instrument governing or
evidencing any of the Secured Obligations;
(b) any change in the time, manner or place of payment of, or in any other
term of, all or any part of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from the
Indenture, any other Note Document or any other agreement or
instrument governing or evidencing any of the Secured Obligations;
(c) any exchange, release or non-perfection of any other Collateral, or
any release or amendment or waiver of or consent to departure from any
guaranty, for all or any of the Secured Obligations;
(d) the insolvency of any Obligor; or
(e) any other circumstance which might otherwise constitute a defense
available to, or a discharge of, the Pledgor.
13. RELEASE
The Pledgor consents and agrees that each of the Trustee, the Collateral
Agent and all the present and future Holders of Secured Obligations may at
any time, or from time to time, in its discretion do any of the following
without changing the Pledgor's obligations hereunder or affecting the
validity, perfection or priority of the Lien granted hereunder:
(a) renew, extend or change the time of payment, and/or the manner, place
or terms of payment of all or any part of the Secured Obligations; and
(b) exchange, release and/or surrender all or any of the Collateral
(including the Pledged Collateral), or any part thereof, by whomsoever
deposited, which is now or may hereafter be held by the Collateral
Agent in connection with all or any of the Secured Obligations; all in
such manner and upon such terms as the Collateral Agent may deem
proper, and without notice to or further assent from the Pledgor, it
being hereby agreed that the Pledgor shall be and remain bound upon
this Agreement, irrespective of the value or condition of any of the
Collateral, and notwithstanding any such change, exchange,
settlement, compromise, surrender, release, renewal or extension, and
notwithstanding also that the Secured Obligations may, at any time,
exceed the aggregate principal amount thereof set forth in the
Indenture, or any other agreement governing any of the Secured
Obligations. The Pledgor hereby waives notice of acceptance of this
Agreement, and also presentment, demand, protest and notice of
dishonor of any and all of the Secured Obligations, and promptness in
commencing suit against any party hereto or liable hereon, and in
giving any notice to or of making any claim or demand hereunder upon
the Pledgor. No act or omission of any kind on the Collateral Agent's
part shall in any event affect or impair this Agreement.
14. REINSTATEMENT
This Agreement shall remain in full force and effect and continue to be
effective should any petition be filed by or against the Pledgor or the
Pledged Entity for liquidation or reorganization, should the Pledgor or the
Pledged Entity become insolvent or make an assignment for the benefit of
creditors or should a receiver or trustee be appointed for all or any
significant part of the Pledgor's or the Pledged Entity's assets, and shall
continue to be effective or be reinstated, as the case may be, if at any
time payment and performance of the Secured Obligations, or any part
thereof, is, pursuant to applicable law, rescinded or reduced in amount, or
must otherwise be restored or returned by any obligee of the Secured
Obligations, whether as a "voidable preference," "fraudulent conveyance,"
or otherwise, all as though such payment or performance had not been made.
In the event that any payment, or any part thereof, is rescinded, reduced,
restored or returned, the Secured Obligations shall be reinstated and
deemed reduced only by such amount paid and not so rescinded, reduced,
restored or returned.
15. MISCELLANEOUS
(a) The Collateral Agent may execute any of its duties hereunder by or
through agents or employees and shall be entitled to advice of counsel
of its selection concerning all matters pertaining to its duties
hereunder.
(b) The Pledgor agrees to promptly reimburse the Collateral Agent for
actual out-of-pocket expenses, including, without limitation,
reasonable counsel fees and expenses, incurred by the Collateral Agent
in connection with the administration and enforcement of this
Agreement.
(c) The Pledgor will pay, reimburse the Trustee, the Collateral Agent and
the Holders of Notes for, and to the fullest extent lawful defend and
indemnify each of them against, all claims, liabilities, taxes, costs
and expenses of every type and nature (including, without limitation,
the reasonable fees and charges of attorneys, advisors, auditors and
consultants acting for any of them) incurred by any of them as a
result of or in connection with the creation, perfection, protection
or enforcement of the security interests granted hereby or the
exercise or enforcement of any right or remedy under this Agreement or
to prove, preserve, protect or enforce any such security interest or
any claim based upon such security interests in any lawsuit,
bankruptcy case or other insolvency or liquidation proceeding. In
accepting, holding and enforcing the security interests, rights and
remedies granted hereby or arising hereunder or otherwise acting as
Collateral Agent, the Collateral Agent may rely upon and enforce each
and all of the provisions of Article 7 of the Indenture conferring any
rights, powers, immunities, indemnities or benefits upon the Trustee,
including (without limitation) the indemnification provided by
Section 7.07(a) of
the Indenture, and the Pledgor agrees to be bound by each and all of
such provisions as fully as if set forth at length herein.
(d) Neither the Collateral Agent, nor any of its respective officers,
directors, employees, agents or counsel shall be liable for any action
lawfully taken or omitted to be taken by it or them hereunder or in
connection herewith, except for its or their own gross negligence or
willful misconduct as finally determined by a court of competent
jurisdiction.
(e) THIS AGREEMENT SHALL BE BINDING UPON THE PLEDGOR AND ITS SUCCESSORS
AND ASSIGNS (INCLUDING A DEBTOR-IN-POSSESSION ON BEHALF OF THE
PLEDGOR), AND SHALL INURE TO THE BENEFIT OF, AND BE ENFORCEABLE BY,
THE TRUSTEE, THE COLLATERAL AGENT AND THE PRESENT AND FUTURE HOLDERS
OF SECURED OBLIGATIONS AND THEIR RESPECTIVE SUCCESSORS AND ASSIGNS,
AND SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF
LAWS (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW), AND NONE OF THE TERMS OR PROVISIONS OF THIS AGREEMENT MAY BE
WAIVED, ALTERED, MODIFIED OR AMENDED EXCEPT IN WRITING DULY SIGNED FOR
AND ON BEHALF OF THE COLLATERAL AGENT AND THE PLEDGOR.
16. SEVERABILITY
If for any reason any provision or provisions hereof are determined to be
invalid and contrary to any existing or future law, such invalidity shall
not impair the operation of or effect those portions of this Agreement
which are valid.
17. NOTICES
Except as otherwise provided herein, whenever it is provided herein that
any notice, demand, request, consent, approval, declaration or other
communication shall or may be given to or served upon any of the parties by
any other party, or whenever any of the parties desires to give or serve
upon any other a communication with respect to this Agreement, each such
notice, demand, request, consent, approval, declaration or other
communication shall be in writing and either shall be delivered in person
or sent by registered or certified mail, return receipt requested, with
proper postage prepaid, or by facsimile transmission and confirmed by
delivery of a copy by personal delivery or United States Mail as otherwise
provided herein:
(a) If to the Trustee or the Collateral Agent, at:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 0 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier Number: (000) 000-0000
Attention: Corporate Trust Administration
(b) If to the Pledgor, at:
x/x X&X Xxxxxxxxx Xxxxxxxx X.X.X.
X&X Finance Corp.
00000 Xxxx Xxxx
Xxxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
Attention: Xxxx X. Enguist
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
With a copy to:
Xxxxxxxx & Xxxxx
Citicorp Center
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxx Xxxxx
or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in
writing by the party entitled to receive such notice. Every notice, demand,
request, consent, approval, declaration or other communication hereunder
shall be deemed to have been duly served, given or delivered (a) upon the
earlier of actual receipt and three (3) Business Days after deposit in the
United States Mail, registered or certified mail, return receipt requested,
with proper postage prepaid, (b) upon transmission, when sent by telecopy
or other similar facsimile transmission (with such telecopy or facsimile
promptly confirmed by delivery of a copy by personal delivery or United
States Mail as otherwise provided in this Section 17), (c) one (1) Business
Day after deposit with a reputable overnight courier with all charges
prepaid, or (d) when delivered, if hand-delivered by messenger. Failure or
delay in delivering copies of any notice, demand, request, consent,
approval, declaration or other communication to the persons designated
above to receive copies shall in no way adversely affect the effectiveness
of such notice, demand, request, consent, approval, declaration or other
communication.
18. SECTION TITLES
The Section titles contained in this Agreement are and shall be without
substantive meaning or content of any kind whatsoever and are not a part of
the agreement between the parties hereto.
19. COUNTERPARTS
This Agreement may be executed in any number of counterparts, which shall,
collectively and separately, constitute one agreement.
20. BENEFIT OF HOLDERS
All security interests granted or contemplated hereby shall be for the
benefit of the Trustee as the Collateral Agent for the benefit of all the
present and future Holders of Secured Obligations, and all proceeds or
payments realized from the Pledged Collateral in accordance herewith shall
be applied to the Secured Obligations in accordance with the terms of the
Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first written above.
GNE INVESTMENTS, INC.,
as the Pledgor
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Secretary
THE BANK OF NEW YORK,
as the Trustee and the Collateral Agent
By: /s/ X. Xxxxxxxxxxxx
Name: X. Xxxxxxxxxxxx
Title: Authorized Signatory
