EXHIBIT 99.11
PLEDGE AGREEMENT
dated as of
December 22, 2004
between
UNITED SERVICE TECHNOLOGIES LIMITED
and
BEAR, XXXXXXX INTERNATIONAL LIMITED
TABLE OF CONTENTS
PAGE
----
1. DEFINITIONS RELATING TO COLLATERAL................. 1
2. THE SECURITY INTERESTS............................. 3
3. CERTAIN COVENANTS OF PLEDGOR....................... 5
4. ADMINISTRATION OF THE COLLATERAL
AND VALUATION OF THE SECURITIES.................... 6
5. INCOME AND VOTING RIGHTS IN COLLATERAL............. 8
6. REMEDIES UPON CERTAIN EVENTS....................... 9
7. TERMINATION OF SECURITY INTEREST................... 10
8. CONDITION TO EFFECTIVENESS......................... 10
9. MISCELLANEOUS...................................... 10
Schedule 1. Forms
PLEDGE AGREEMENT
THE PLEDGE AGREEMENT (this "AGREEMENT") is made as of this 22nd day of
December, 2004 between United Service Technologies Limited, an International
Business Company incorporated under the laws of the British Virgin Islands
("UNISERV" or "PLEDGOR"), and Bear, Xxxxxxx International Limited ("SECURED
PARTY").
WHEREAS, Pledgor entered into an Amended and Restated Credit Agreement
dated as of December 16, 2004 between Pledgor and Secured Party, as amended by
Amendment No. 1 dated as of December 22, 2004 (as so amended, the "CREDIT
AGREEMENT"), and the Confirmation (as defined in the Credit Agreement) in
accordance with the terms thereof and, on the Novation Date (as defined in the
Credit Agreement), the Pledgor will be the SPV (as defined in the Credit
Agreement);
WHEREAS, simultaneously herewith Pledgor and Secured Party will enter into
a Confirmation (as defined in the Credit Agreement) pursuant to which Pledgor
and Secured Party will enter into a collar transaction on the Trade Date
specified therein (the "TRANSACTION");
WHEREAS, Uniserv has entered into an amended and restated credit
agreement, as further amended (the "5-YEAR CREDIT AGREEMENT"), a confirmation
and a pledge agreement, each with Credit Suisse First Boston International and
each having terms substantially identical to the Credit Agreement (except with
respect to the Advance Rate and maturity thereunder), the Confirmation and this
Agreement, respectively;
WHEREAS, it is a condition to the effectiveness of the Confirmation and a
condition to making any Loan (as defined in the Credit Agreement) under the
Credit Agreement that this Agreement shall have been executed (or will be
executed simultaneously with the making of any such Loan) by the parties hereto
and Pledgor shall have delivered to Secured Party in accordance herewith the
collateral required to be delivered pursuant to this Agreement;
WHEREAS, on and following the Novation Date (as defined in the Credit
Agreement) this Agreement shall be novated and transferred to the SPV, whereupon
the SPV shall be the "Pledgor" hereunder;
NOW, THEREFORE, in consideration of their mutual covenants contained
herein and to secure the full and punctual observance and performance by Pledgor
of its Obligations (as defined in the Credit Agreement), the parties hereto,
intending to be legally bound, hereby mutually covenant and agree as follows:
1. Definitions Relating to Collateral.
Capitalized terms used and not otherwise defined herein shall have the meanings
ascribed to them in the Confirmation (as defined in the Credit Agreement) or the
Credit Agreement, as applicable. As used herein, the following words and phrases
shall have the following meanings:
"ADDITIONAL PLEDGED ITEMS" has the meaning provided in Section 2(d) of
this Agreement.
"ADDITIONS AND SUBSTITUTIONS" has the meaning provided in Section 2(a) of
this Agreement.
"COLLATERAL" has the meaning provided in Section 2(a) of this Agreement.
"COLLATERAL ACCOUNT" has the meaning provided in Section 4(c) of this
Agreement.
"COLLATERAL EVENT OF DEFAULT" means, at any time, the occurrence of any of
the following: (A) failure of the Collateral to include, as Eligible Collateral,
(i) at all times (subject to Section 4(h) hereof), a number of Shares at least
equal to the aggregate Number of Options for all Tranches under the Confirmation
(as such aggregate number of Options may increase on the Option Closing Date
pursuant to the Confirmation) for which the Settlement Date or Cash Settlement
Payment Date has not yet occurred, (ii) if Pledgor has elected to substitute
Government Securities for Share Collateral in accordance with Section 4(h) of
this Agreement, the amount of Government Securities required thereby or (iii) if
Pledgor shall have validly elected to cash settle any Tranche under the
Confirmation or shall have validly pledged the Cash Termination Obligation, the
amount of cash (or value of cash equivalents as determined by the Secured Party)
as required by Section 2(c) of this Agreement, (B) failure at any time of the
Security Interests to constitute valid and perfected security interests in all
of the Collateral, subject to no prior, equal or junior Lien other than the
Liens created under the Deed of Debenture, and, with respect to any Collateral
consisting of securities or security entitlements (each as defined in Section
8-102 of the UCC), as to which Secured Party has Control, or, in each case,
assertion of such by Pledgor in writing or (C) at any time following the
Novation Date, the failure of the Share Collateral (or securities entitlements
with respect thereto) to constitute outstanding securities by the issuer thereof
under the relevant law of such issuer's jurisdiction of organization (provided
that it shall not be a Collateral Event of Default under this clause (c), if,
following any event or transaction that would upon consummation of such event or
transaction constitute a Collateral Event of Default under this clause (c), the
successor or surviving entity, immediately following such consummation,
exercises the Early Unwind Option in accordance with the Confirmation).
"CONTROL" means "control" as defined in Section 8-106 and Section 9-106 of
the UCC.
"CUSTODIAN" means Secured Party, or any other custodian appointed by
Secured Party and identified to Pledgor.
"DEFAULT EVENT" means (i) any Event of Default under the Confirmation or
the ISDA Form with respect to Pledgor, (ii) the occurrence or effective
designation of an Early Termination Date in respect of the Transaction, (iii)
the occurrence of an Extraordinary Event that results in the cancellation or
termination of the Transaction pursuant to Section 12.2, 12.3, 12.6 or 12.9 of
the 2002 Definitions and (iv)any Event of Default under the Credit Agreement.
"ELIGIBLE COLLATERAL" means (i) Shares, (ii) if Pledgor shall have elected
to substitute Government Securities for Share Collateral in accordance with
Section 4(h) of this Agreement, Government Securities or (iii) if Pledgor shall
have validly elected to cash settle any Tranche under the Confirmation or shall
have validly elected the Cash Termination Obligation, cash (in United States
currency) or cash equivalents acceptable to Secured Party; provided that, in
each case, Pledgor has good and marketable title thereto, free of all Liens
(other than the Security Interests) and Transfer Restrictions (other than the
Existing Transfer Restrictions) and that Secured Party has a valid, first
priority perfected security interest therein, a first lien thereon and Control
with respect thereto.
"EXCLUDED PROCEEDS" means any ordinary cash dividend with respect to the
Shares, to the extent (i) not an Extraordinary Dividend in excess of the
Ordinary Dividend Amount and (ii) such ordinary cash dividend is not distributed
after the occurrence and during the continuance of a Default Event.
"EXISTING TRANSFER RESTRICTIONS" means, at any time, Transfer Restrictions
existing with respect to any securities by virtue of the fact that Pledgor is an
"affiliate" at such time or was an "affiliate" three months prior to such time,
within the meaning of Rule 144 under the Securities Act, of the Issuer.
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"GOVERNMENT SECURITIES" means securities issued by the United States
Government.
"INITIAL PLEDGED ITEMS" has the meaning provided in Section 2(d) of this
Agreement.
"LOCATION" means, with respect to any party, such party's "location"
within the meaning of Section 9-307 of the UCC.
"OPTION RIGHTS" has the meaning provided in Section 2(a)(iv) of this
Agreement.
"PERSON" means an individual, a corporation, a limited liability company,
a partnership, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.
"PLEDGED ITEMS" means, as of any date, any and all cash, securities and
instruments delivered by Pledgor to be held by or on behalf of Secured Party
under this Agreement as Collateral.
"RETAINED PROCEEDS" has the meaning provided in Section 5(a) of this
Agreement.
"SECURITY INTERESTS" means the security interests in the Collateral
created hereby.
"SHARE COLLATERAL" has the meaning provided in Section 4(h) of this
Agreement.
"TRANSFER RESTRICTION" means, with respect to any item of Collateral
pledged under this Agreement, any condition to or restriction on the ability of
the owner thereof to sell, assign or otherwise transfer such item of Collateral
or to enforce the provisions thereof or of any document related thereto whether
set forth in such item of collateral itself or in any document related thereto,
including, without limitation, (i) any requirement that any sale, assignment or
other transfer or enforcement of such item of Collateral be consented to or
approved by any Person, including, without limitation, the issuer thereof or any
other obligor thereon, (ii) any limitations on the type or status, financial or
otherwise, of any purchaser, pledgee, assignee or transferee of such item of
collateral, (iii) any requirement of the delivery of any certificate, consent,
agreement, opinion of counsel, notice or any other document of any Person to the
issuer of, any other obligor on or any registrar or transfer agent for, such
item of Collateral, prior to the sale, pledge, assignment or other transfer or
enforcement of such item of Collateral and (iv) any registration or
qualification requirement or prospectus delivery requirement for such item of
Collateral pursuant to any federal, state or foreign securities law (including,
without limitation, any such requirement arising under Section 5 of the
Securities Act as a result of such security being a "restricted security" or
Pledgor being an "affiliate" of the issuer of such security, as such terms are
defined in Rule 144 under the Securities Act, or as a result of the sale of such
security being subject to paragraph (c) of Rule 145 under the Securities Act);
provided that the required delivery of any assignment, instruction or
entitlement order from the seller, Pledgor, assignor or transferor of such item
of collateral, together with any evidence of the corporate or other authority of
such Person, shall not constitute a "Transfer Restriction."
"UCC" means the Uniform Commercial Code as in effect in the State of New
York.
2. The Security Interests.
In order to secure the full and punctual observance and performance of the
Obligations:
(a) Pledgor hereby charges, assigns and pledges to Secured Party,
and grants to Secured Party, security interests in and to, and a Lien upon
and right of set-off against, and transfers to Secured Party, as and by
way of a security interest having priority over all other security
interests, all of Pledgor's right, title and interest in and to:
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(i) the Initial Pledged Items and, to the extent delivered
under Section (d) below, the Additional Pledged Items;
(ii) all additions to and substitutions for the Initial
Pledged Items (including, without limitation, any cash, securities,
instruments or other property delivered or pledged pursuant to
Section 2(d), 3(a) or 4(b) of this Agreement) (such additions and
substitutions, the "ADDITIONS AND SUBSTITUTIONS");
(iii) the Collateral Account and all securities and other
financial assets (each as defined in Section 8-102 of the UCC) and
other funds, property or assets from time to time held therein or
credited thereto and all securities entitlements in respect thereof;
(iv) all rights of Pledgor pursuant to the Transaction
thereunder or under any agreement, document or instrument relating
thereto, including without limitation, the ISDA Form and the
Confirmation (collectively, the "OPTION RIGHTS"); and
(v) all income, proceeds and collections received or to be
received, or derived or to be derived, at the time that the Initial
Pledged Items and the Additional Pledged Items (if any) were
delivered to the Custodian or any time thereafter (whether before or
after the commencement of any proceeding under applicable
bankruptcy, insolvency or similar law, by or against Pledgor, with
respect to Pledgor) from or in connection with the Initial Pledged
Items, the Additional Pledged Items, the Additions and
Substitutions, or any Option Rights but excluding any Excluded
Proceeds (collectively, the "COLLATERAL").
(b) On and following the Novation Date, SPV, as successor Pledgor,
hereunder, hereby charges, assigns and pledges to Secured Party, and
grants to Secured Party, security interests in and to, and a Lien upon and
right of set-off against, and transfers to Secured Party, as and by way of
a security interest having priority over all other security interests, all
of Pledgor's right, title and interest in and to all the Collateral.
(c) Registration
(i) On or prior to the Closing Date, Pledgor, as the initial
Pledgor hereunder, shall create a register of mortgages, charges and
other encumbrances (the "REGISTER") and enter the details of this
Agreement thereon, in a form attached hereto as Exhibit A, and shall
deliver to Secured Party a letter from the registered agent of
Uniserv addressed to the Registrar of Corporate Affairs in the
British Virgin Islands authorizing Secured Party to file a copy of
such register with the Registrar of Corporate Affairs in the British
Virgin Islands in the event that the Novation Date shall not have
occurred as provided in the Credit Agreement.
(ii) On the Novation Date, SPV, as successor Pledgor, shall
create a register of mortgages, charges and other encumbrances (the
"SPV REGISTER") and enter the details of this Agreement thereon, in
a form attached hereto as Exhibit A, and shall file a copy of the
SPV Register with the Registrar of Corporate Affairs in the British
Virgin Islands.
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(iii) If, at any time the Share Collateral is held in a form
other than as securities in respect of which securities entitlements
are held in the Collateral Account, the Pledgor further agrees,
where applicable, to request and use commercially reasonable efforts
to procure a notation to be made on the share register of the
relevant company in relation to the Shares covered by this Agreement
indicating that the Shares are charged; the name of the chargee; and
the date on which the aforesaid particulars are entered in the share
register and use commercially reasonable efforts to file or procure
the filing of same with the Registrar of Corporate Affairs in the
British Virgin Islands.
(d) On or prior to the Closing Date, Pledgor shall deliver to
Secured Party in pledge hereunder, Eligible Collateral consisting of a
number of Shares equal to the aggregate Number of Options for all Tranches
under the Confirmation (the "INITIAL PLEDGED ITEMS"). On the Novation
Date, SPV, as successor Pledgor, shall deliver to Secured Party in pledge
hereunder, such Initial Pledged Items; provided that if Uniserv, as
initial Pledgor, shall have delivered the Initial Pledged Items to Secured
Party on the Closing Date in the manner set forth in Section 4(c), SPV's
obligation to so deliver the Initial Pledged Items shall be deemed
satisfied. If, pursuant to the Confirmation, the Number of Options shall
have increased as set forth in the Confirmation, then, on or prior to the
Option Closing Date, Pledgor shall deliver to Secured Party in pledge
hereunder Eligible Collateral consisting of a number of Shares equal to
such increase in the Number of Options (the "ADDITIONAL PLEDGED ITEMS").
Deliveries of such Initial Pledged Items and the Additional Pledged Items
shall occur in the manner set forth in Section 4(c).
(e) If Pledgor elects cash settlement of any Tranche under the
Confirmation or elects the Cash Termination Obligation under the
Confirmation, Pledgor shall make the payments and deliveries set forth
under "Cash Settlement" or Section 3(c) in the Confirmation, as
applicable; provided that, with respect to Cash Settlement of any Tranche,
the failure to deliver any Eligible Collateral or pay any Preliminary
Option Cash Settlement Amount as required therein (other than, for the
avoidance of doubt, any cash due if the Option Cash Settlement Amount
exceeds its Preliminary Option Cash Settlement Amount for any Component)
shall not constitute a Collateral Event of Default or a Default Event and
shall instead cause Physical Settlement to apply for all remaining
Components of such Tranche as set forth in the Confirmation.
(f) The parties hereto expressly agree that all rights, assets and
property at any time held in or credited to the Collateral Account shall
be treated as financial assets (as defined in Section 8-102 of the UCC).
3. Certain Covenants of Pledgor.
Pledgor agrees that, so long as any of the Obligations remain outstanding:
(a) Pledgor shall use reasonable efforts to ensure at all times that
a Collateral Event of Default shall not occur, and shall pledge additional
Collateral in the manner described in Sections 4(b) and 4(c) of this
Agreement as necessary to cause such requirement to be met.
(b) Pledgor shall, at its own expense and in such manner and form as
Secured Party may reasonably require, give, execute, deliver, file and
record any financing statement, notice, instrument, document, agreement or
other papers that may be necessary or desirable in order to (A) create,
preserve, perfect, substantiate or validate any security interest granted
pursuant hereto, (B) create or maintain Control with respect to any such
security interests in any investment property (as defined in Section
9-102(a)
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of the UCC) or (C) enable Secured Party to exercise and enforce its rights
hereunder with respect to such security interest.
(c) Pledgor shall warrant and defend Pledgor's title to the
Collateral, subject to the rights of Secured Party, against the claims and
demands of all persons. Upon written notice to Pledgor, Secured Party may
elect, but without an obligation to do so, to discharge any Lien of any
third party on any of the Collateral.
(d) Pledgor agrees that Pledgor shall not change (A) Pledgor's name
in any manner or (B) Pledgor's Location, unless Pledgor in either case
shall have given Secured Party not less than 10 days' prior notice
thereof.
(e) Pledgor agrees that Pledgor shall not (A) create or permit to
exist any Lien, other than the Permitted Security Interests (as defined in
the Deed of Debenture), or any Transfer Restriction (other than the
Existing Transfer Restrictions) upon or with respect to the Collateral,
(B) sell or otherwise dispose of, or grant any option with respect to, any
of the Collateral or (C) enter into or consent to any agreement (other
than, in the case of clause (x), the Confirmation and, in the case of
clause (y), an assignment or novation agreement permitted hereunder) (x)
that restricts in any manner the rights of any present or future owner of
any Collateral with respect thereto or (y) pursuant to which any person
other than Pledgor, Secured Party and any securities intermediary through
whom any of the Collateral is held (but in the case of any such securities
intermediary only in respect of Collateral held through it) has or will
have Control in respect of any Collateral.
(f) Pledgor agrees, notwithstanding any other notices, statutory or
otherwise, that may be required, that it shall, if reasonably practicable
to do so, give not less than 2 Business Days notice in writing to the
Secured Party of any application under any Debtor Relief Law by the
Pledgor or on behalf of the Pledgor for an administration order or other
such order that may restrict the Secured Party's rights under this
Agreement.
(g) If, at any time the Share Collateral is held in a form other
than as securities in respect of which securities entitlements are held in
the Collateral Account, the Pledgor agrees to deposit with the Secured
Party all documents of title relating to the Collateral when called upon
by the Secured Party, including, in relation to the Shares, the deposit of
all certificates and other documents of title or evidence of ownership in
relation to the Shares and the delivering to the Secured Party of executed
share transfers and other documents which may be requested by the Secured
Party in order to enable the Secured Party or its nominees to be
registered as the owner or otherwise obtain title to the Shares.
4. Administration of the Collateral and Valuation of the Securities.
(a) Secured Party shall determine on each Business Day whether a
Collateral Event of Default shall have occurred.
(b) Pledgor may pledge additional Eligible Collateral hereunder at
any time by delivery of the same pursuant to Section 4(c) of this
Agreement. Concurrently with the delivery of any additional Eligible
Collateral, Pledgor shall deliver to Secured Party a certificate, dated
the date of such delivery, (A) identifying the additional items of
Eligible Collateral being pledged and (B) certifying that with respect to
such items of additional Eligible Collateral the representations and
warranties contained in Paragraphs (vi), (vii),
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(viii) and (ix) of Section 3(d) of the Confirmation are true and correct
with respect to such Eligible Collateral on and as of the date thereof.
(c) Any delivery of any securities or security entitlements (each as
defined in Section 8-102 of the UCC) as Collateral to Secured Party by
Pledgor, shall be effected by (i) in the case of collateral consisting of
securities in respect of which securities entitlements are held by the
Pledgor through a securities intermediary, the crediting of such
securities, accompanied by any required transfer tax stamps, to a
securities account of the Custodian at such securities intermediary or, at
the option of Secured Party, at another securities intermediary
satisfactory to Secured Party and the crediting by the Custodian of such
securities to a securities account (as defined in Section 8-501 of the
UCC) (the "COLLATERAL ACCOUNT") of and in the name of Secured Party and
(ii) in any other case, by complying with reasonable delivery instructions
as Secured Party shall provide to Pledgor in writing. Any delivery of
Eligible Collateral consisting of cash shall be in immediately available
funds deposited to the Collateral Account of Secured Party. Delivery of
the Initial Pledged Items by SPV, as successor Pledgor, on and after the
Novation Date, shall be effected by the Custodian on behalf of SPV, as
successor Pledgor, by transfer of the Initial Pledged Items to a
Collateral Account of Secured Party maintained by the Custodian.
Notwithstanding anything to the contrary in this Agreement or in any other
agreement between Pledgor and Secured Party (or any of its affiliates),
neither the Secured Party nor the Custodian shall take any entitlement
order with respect to the Collateral Account and Pledgor agrees that
Secured Party shall have Control of such Collateral Account.
(d) If on any Business Day Secured Party determines that a
Collateral Event of Default shall have occurred, Secured Party shall
promptly notify Pledgor of such determination by telephone call to Pledgor
followed promptly by a written confirmation of such call.
(e) If on any Business Day Secured Party determines that no Default
under the Credit Agreement or Default Event or failure by Pledgor to meet
any of Pledgor's obligations under Section 3 or 4 hereof has occurred and
is continuing, Pledgor may obtain the release from the Security Interests
of any Collateral upon delivery to Secured Party of a written notice from
Pledgor indicating the items of Collateral to be released so long as,
after such release, no Collateral Event of Default shall have occurred.
(f) Secured Party may at any time, or, from time to time, in its
sole discretion, cause any or all of the Collateral that is registered in
the name of Pledgor or Pledgor's nominee to be transferred of record into
the name of the Custodian, Secured Party or its nominee. Pledgor shall
promptly give to Secured Party copies of any notices or other
communications received by Pledgor with respect to Collateral that is
registered, or held through a securities intermediary, in the name of
Pledgor or Pledgor's nominee and Secured Party shall promptly give to
Pledgor copies of any notices and communications received by Secured Party
with respect to Collateral that is registered, or held through a
securities intermediary, in the name of Custodian, Secured Party or its
nominee.
(g) Pledgor agrees that Pledgor shall forthwith upon demand pay to
Secured Party after receipt by Pledgor from Secured Party of an invoice
therefor (setting forth in reasonable detail the nature of such costs and
expenses):
(i) the amount of any taxes that Secured Party or the
Custodian may have been required to pay that are directly
attributable to the Security Interests or to free any of the
Collateral from any Lien thereon; and
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(ii) reasonable out-of-pocket costs and expenses, including
the reasonable fees and disbursements of counsel and of any other
experts, that Secured Party or the Custodian incurs in connection
with (A) the enforcement of this Agreement, including such expenses
as are incurred to preserve the value of the Collateral and the
validity, perfection, rank and value of the Security Interests, (B)
the collection, sale or other disposition of any of the Collateral,
(C) the exercise by Secured Party of any of the rights conferred
upon it hereunder or (D) any Default Event.
Any such amount not paid on demand as specified above shall bear interest
(computed on the basis of a year of 360 days and payable for the actual
number of days elapsed) at a rate per annum equal to 2% plus Overnight
LIBOR (as defined in the Credit Agreement).
(h) Pledgor may at any time, so long as no Default Event has
occurred and is continuing, substitute Government Securities for all (but
not less than all) of the Collateral consisting of Shares then held in or
credited to the Collateral Account (the "SHARE COLLATERAL") on the terms
set forth below:
(i) At least five Business Days prior to the date of any such
substitution, Pledgor shall notify Secured Party in writing that
Pledgor intends to effect such substitution;
(ii) Pledgor shall deliver to Secured Party, in a manner
reasonably acceptable to Secured Party, Government Securities having
a value at least equal to 150% of the market value of the Share
Collateral on the date of such delivery (as determined by the
Calculation Agent);
(iii) Pledgor shall take all such other actions as Secured
Party may reasonably require to create for the benefit of Secured
Party a valid and perfected security interest in such Government
Securities, in respect of which Secured Party will have Control,
subject to no prior Lien; and
(iv) Pledgor shall make xxxx-to-market deliveries of
additional Government Securities on a daily basis, and Secured Party
shall release Government Securities previously pledged upon the
request of Pledgor, so that the value of the Government Securities
pledged is at all times at least equal to 150% of the market value
of the Share Collateral that would otherwise have been pledged
hereunder at such time (as determined by the Calculation Agent), in
each case, pursuant to terms mutually acceptable to Secured Party
and Pledgor.
5. Income and Voting Rights in Collateral.
(a) Secured Party shall have the right to receive and retain as
Collateral hereunder all proceeds of any Collateral, excluding any
Excluded Proceeds; provided that Secured Party shall have such right with
respect to any and all proceeds, including, without limitation, any
Excluded Proceeds, after the occurrence and during the continuance of a
Default Event (such proceeds as Secured Party shall have the right to
receive and retain at any time, "RETAINED PROCEEDS"), and Pledgor shall
take all such action as Secured Party shall deem reasonably necessary or
appropriate to give effect to such right. All such Retained Proceeds that
are received by Pledgor shall be received in trust for the benefit of
Secured Party and, if Secured Party so directs, shall be segregated from
other funds of Pledgor and shall, forthwith upon demand by Secured Party,
be delivered over to the Custodian on behalf of Secured Party as
Collateral in the same form
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as received (with any necessary endorsement). To the extent any
Extraordinary Dividend is paid by the Issuer and received and held by
Secured Party as Retained Proceeds hereunder, Secured Party shall, at
Pledgor's direction, deliver such Extraordinary Dividend on Pledgor's
behalf, free of the Security Interests, to Secured Party in satisfaction
of Pledgor's payment obligation in respect of such Extraordinary Dividends
under the Confirmation.
(b) Secured Party shall provide, or shall cause to be provided, in
accordance with its normal procedures for securities held in street name,
to Uniserv (before, on or after the Novation Date) copies of all notices
furnished to it as record owner of the Share Collateral and shall vote,
give consents, or otherwise exercise any other rights of the holder of the
Share Collateral as directed by Uniserv. Secured Party shall retain, or
shall cause to be retained, the originals of any notices received from the
Issuer under the Shares.
(c) If a Default Event shall have occurred and be continuing,
Secured Party shall have the right, to the extent permitted by law, and
Pledgor shall take all such action as may be necessary or appropriate to
give effect to such right, to vote and to give consents, ratifications and
waivers, and to take any other action with respect to any or all of the
Collateral (other than the Share collateral) with the same force and
effect as if Secured Party were the absolute and sole owner thereof.
(d) Secured Party shall, to the extent received by Secured Party,
execute and deliver to Uniserv (before, on or after the Novation Date), or
cause to be executed and delivered to Uniserv (before, on or after the
Novation Date), all such proxies, powers of attorney, and other
instruments as Uniserv (before, on or after the Novation Date) may
reasonably request for the purpose of enabling Uniserv (before, on or
after the Novation Date) to exercise voting, consensual and/or other
rights and powers it is entitled to exercise pursuant to paragraph (b)
above.
6. Remedies upon Certain Events.
(a) Upon any Default Event, Secured Party may exercise all the
rights of a secured party under the UCC (whether or not in effect in the
jurisdiction where such rights are exercised).
(b) Pledgor hereby irrevocably appoints Secured Party as Pledgor's
true and lawful attorney (which power of attorney is coupled with an
interest), with full power of substitution, in the name of Pledgor,
Secured Party or otherwise, for the sole use and benefit of Secured Party,
but at the expense of Pledgor, to the extent permitted by law, to
exercise, at any time and from time to time upon the occurrence of a
Default Event, all or any of the following powers with respect to all or
any of the Collateral:
(i) to demand, xxx for, collect, receive and give acquittance
for any and all monies due or to become due upon or by virtue
thereof;
(ii) to settle, compromise, compound, prosecute or defend any
action or proceeding with respect thereto;
(iii) to sell, transfer, assign or otherwise deal in or with
the same or the proceeds or avails thereof, as fully and effectually
as if Secured Party were the absolute owner thereof and in
connection therewith, to make all necessary deeds, bills of sale,
instruments of assignment, transfer or conveyance of the property,
and all instructions and entitlement orders in
9
respect of the property thus to be (or that is being or has been)
sold, transferred, assigned or otherwise dealt in; and
(iv) to extend the time of payment of any or all thereof and
to make any allowance and other adjustments with reference thereto;
provided that Secured Party shall give Pledgor not less than seven
days prior written notice setting forth in reasonable detail of the
time and place of any sale or other intended disposition of any of
the Collateral, except any Collateral that threatens to decline
speedily in value, including, without limitation, equity securities,
or is of a type customarily sold on a recognized market. Secured
Party and Pledgor agree that such notice constitutes "reasonable
authenticated notification" within the meaning of Section 9-611(b)
of the UCC.
7. Termination of Security Interest.
The Security Interest and the rights granted by Pledgor in the
Collateral pursuant to this Agreement shall automatically cease, terminate
and be void upon the payment and fulfilment of all of the Obligations
including, without limitation, upon delivery of the Early Unwind Shares on
the Early Unwind Date together with any accrued and unpaid amounts. Any
Collateral remaining at the time of such termination shall automatically
be fully released and discharged from the Security Interests and shall be
delivered promptly to Pledgor by Secured Party, all at the expense of
Pledgor. In connection with any termination and automatic release as a
result thereof, the Secured Party shall (i) execute and deliver to the
Pledgor, at the Pledgor's expense, such documents that the Pledgor shall
reasonably request that in the Pledgor's reasonable judgment are necessary
or advisable to evidence such termination and automatic release as a
result thereof and (ii) cause any and all Collateral remaining at the time
of such termination that is registered in the name of Custodian, Secured
Party or its nominee to be transferred of record into the name of Pledgor
or Pledgor's nominee.
8. Condition to Effectiveness
The effectiveness of this Agreement and all the agreements and
obligations of each party hereunder shall be subject to the condition that
all the conditions in Section 4.01 of the 5-year Credit Agreement shall
have been satisfied and the initial Loans (as defined in the 5-year Credit
Agreement) shall have been made thereunder.
9. Miscellaneous.
(a) Without limiting the rights and obligations of the parties under
this Agreement, to the extent Pledgor has elected to Cash Settlement of
any Tranche under the Confirmation, and any Collateral consists of cash or
cash equivalents pledged by Pledgor pursuant to Section 2(d) hereof,
Secured Party will have the right to use, pledge, rehypothecate, assign,
invest, commingle or otherwise dispose of, or otherwise use in its
business any such Collateral free from any claim or right of any nature
whatsoever of the Pledgor, including any equity or right of redemption by
the Pledgor, provided that Secured Party shall return any such Collateral
when the related Tranche Loan becomes due under the Credit Agreement,
subject to the netting and set-off provision of Section 9.10 of the Credit
Agreement.
(b) This Agreement is not intended and shall not be construed to
create any rights in any person other than Pledgor, Secured Party and
their respective successors and assigns and no other person shall assert
any rights as third party beneficiary hereunder. Whenever any of the
parties hereto is referred to, such reference shall be deemed to include
the successors and assigns of such party. All of the covenants and
agreements
10
herein contained by or on behalf of Pledgor and Secured Party shall bind,
and inure to the benefit of, their respective successors and assigns
whether so expressed or not.
(c) Notwithstanding any provision of the Agreement to the contrary,
Secured Party shall be entitled to assign its rights and obligations
hereunder to receive or transfer cash, Government Securities or Shares and
other related rights to one or more entities that are wholly owned,
directly or indirectly, by Secured Party, or any successor thereto (each,
a "SECURED PARTY AFFILIATE"); provided that Pledgor shall have recourse to
Secured Party in the event of the failure by a Secured Party Affiliate to
perform any of such obligations hereunder. Notwithstanding the foregoing,
recourse to Secured Party shall be limited to recoupment of Pledgor's
monetary damages and Pledgor hereby waives any right to seek specific
performance by Secured Party of its obligations hereunder. Such failure
after any applicable grace period shall be an Additional Termination Event
with the Transaction as the sole Affected Transaction and the Secured
Party as the sole Affected Party.
(d) Notwithstanding anything in this Agreement to the contrary,
Pledgor shall be entitled to novate this Agreement pursuant to the
Novation Agreement (as defined in the Credit Agreement).
(e) No amendment, modification or waiver in respect of this
Agreement will be effective unless in writing (including a writing
evidenced by a facsimile transmission) and executed, in the case of an
amendment or modification, by each of the parties hereto or confirmed by
an exchange of telexes or electronic messages on an electronic messaging
system or, in the case of a waiver, by the party against whom the waiver
is to be effective.
(f) A failure or delay in exercising any right, power or privilege
in respect of this Agreement will not be presumed to operate as a waiver,
and a single or partial exercise of any right, power or privilege will not
be presumed to preclude any subsequent or further exercise, of that right,
power or privilege or the exercise of any other right, power or privilege.
(g) Except as provided in this Agreement, the rights, powers,
remedies and privileges provided in this Agreement are cumulative and not
exclusive of any rights, powers, remedies and privileges provided by law.
(h) All notices or other communications required or permitted to be
made hereunder shall be in writing, addressed to the respective parties at
the addresses specified in Section 4(e)(i) of the Confirmation and
effective upon the terms set forth in the Confirmation.
(i) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAW PRINCIPLES THEREOF THAT WOULD APPLY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK (PROVIDED THAT AS TO PLEDGED
ITEMS LOCATED IN ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK,
SECURED PARTY SHALL, IN ADDITION TO ANY RIGHTS UNDER THE LAWS OF THE STATE
OF NEW YORK, HAVE ALL OF THE RIGHTS TO WHICH A SECURED PARTY IS ENTITLED
UNDER THE LAWS OF SUCH OTHER JURISDICTION).
11
ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE
BROUGHT IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX SITTING IN THE BOROUGH OF
MANHATTAN, CITY OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
EACH PARTY TO THIS AGREEMENT CONSENTS, FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH PARTY TO
THIS AGREEMENT IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION
TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS,
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR OTHER
DOCUMENT RELATED THERETO. EACH PARTY TO THIS AGREEMENT WAIVES PERSONAL
SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY
ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE. THE PARTIES HERETO
AGREE THAT THE CUSTODIAN'S JURISDICTION, WITHIN THE MEANING OF SECTION
8-110(E) OF THE UCC, WITH RESPECT TO THE COLLATERAL ACCOUNT, FINANCIAL
ASSETS OR SECURITY ENTITLEMENTS HELD THEREIN OR CREDIT THERETO, IS THE
STATE OF NEW YORK.
(j) If compliance by either party with any provision of this
Agreement would be unenforceable or illegal, (i) the parties shall
negotiate in good faith to resolve such unenforceability or illegality in
a manner that preserves the economic benefits of the transactions
contemplated hereby and (ii) the other provisions of this Agreement shall
not be invalidated, but shall remain in full force and effect.
(k) EACH OF THE PLEDGOR AND THE SECURED PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION ARISING UNDER THIS AGREEMENT OR IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO THIS AGREEMENT, OR THE TRANSACTIONS RELATED THERETO, IN
EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED
IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND
CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE
DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS
AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH
ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO
THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
(l) This Agreement may be executed in any number of counterparts,
and all such counterparts taken together shall be deemed to constitute one
and the same agreement. Delivery of an executed signature page to this
Agreement by facsimile transmission shall be as effective as delivery of a
manually signed counterpart of this Agreement.
(m) Service of process shall be made in accordance with Section
4(e)(iv) of the Confirmation.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
PLEDGOR:
UNITED SERVICE TECHNOLOGIES LIMITED
By: /s/ Xxxxxx Xxxxxxx
----------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Director
SECURED PARTY:
BEAR, XXXXXXX INTERNATIONAL LIMITED
By: /s/ Xxxxx Xxxxx
________________________________________
Name:
Title:
14
EXHIBIT A
