Exhibit 5
PLEDGE AGREEMENT
This Pledge Agreement (the "Agreement"), dated as of May 12, 2003, is made by
ACT Teleconferencing, Inc., a Colorado corporation ("Pledgor"), in favor of
NewWest Mezzanine Fund LP, a Colorado limited partnership, in its capacity as
Collateral Agent (the "Collateral Agent"), for the benefit of NewWest Mezzanine
Fund LP, a Colorado limited partnership, in its capacity as a lender, and KCEP
Ventures II, L.P., a Missouri limited partnership, Convergent Capital Partners
I, L.P., a Delaware limited partnership, and Xxxxx X. Xxxxxxx Management Trust
dated October 8, 1992 (collectively, "Lenders"). Lenders have provided financing
to ACT Teleconferencing Services, Inc. and certain co-borrowers that are
subsidiaries of Pledgor (collectively, "Borrower") pursuant to the terms and
conditions of a Note Agreement, dated as of the date of this Agreement, among
Pledgor, Borrower and Lenders (as such Note Agreement may be amended,
supplemented, amended and restated, renewed or otherwise modified from time to
time hereafter, the "Note Agreement"). All capitalized terms not otherwise
defined shall have the meaning ascribed thereto in the Note Agreement. Pledgor
is the owner of the percentage of the outstanding common stock of Borrower and
each of the other companies as set forth on Schedule A hereto (each a "Company"
and collectively the "Companies") and, as a condition precedent to the Note
Agreement and Lenders' extension of credit under the Note Agreement, Lenders
have requested that Pledgor grant the Collateral Agent, for the benefit of
Lenders, the security interest contemplated by this Agreement. In consideration
of the foregoing and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Pledgor and the Collateral
Agent, for the benefit of Lenders, agree as follows:
1. Grant of Security Interest. Pledgor hereby assigns and pledges to
the Collateral Agent for the benefit of Lenders and hereby grants to the
Collateral Agent for the benefit of Lenders a security interest in, all of
the right, title and interest of Pledgor in and to the following, whether
now owned or hereafter acquired (the "Collateral").
(a) All shares of stock issued by each Company are held or
beneficially owned by Pledgor (the "Pledged Shares"), including the
certificates representing the Pledged Shares (as such are listed on
Schedule A hereto and made a part hereof), and all dividends, cash,
instruments and other property from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all
of the Pledged Shares;
(b) All additional shares of stock of each Company from time to
time acquired by Pledgor in any manner, and the certificates
representing such additional shares, and all dividends, cash,
instruments and other property from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all
of such shares; and
(c) All proceeds of any and all of the foregoing Collateral
described in clauses (a) and (b) of this Section 1 and any and all
payments (in any form whatsoever) made, due or payable to Pledgor from
time to time in connection with any requisition, confiscation,
condemnation, seizure or forfeiture of all or any part of the
Collateral by any governmental body, authority, bureau or agency (or
any Person acting under color of governmental authority) and, to the
extent not otherwise included, all payments under any indemnity,
warranty or guaranty, payable by reason of loss or damage to or
otherwise with respect to any of the foregoing Collateral (the
"Proceeds").
Notwithstanding anything to the contrary contained in this
Section 1, Pledgor shall not be required to pledge more than 65% of
the total outstanding voting stock of any non-U.S. Subsidiary of
Pledgor pursuant to this Agreement if such pledge could give rise to
adverse tax consequences to Pledgor, and not be required to pledge
more than 60% of the total outstanding stock of ACT Teleconferencing
Limited.
2. Security for Obligations. This Agreement and the Collateral under
this Agreement secures the payment of (i) all obligations of Borrower now
or hereafter existing under the Note Agreement and the other Financing
Documents, whether for principal, interest, fees, expenses or otherwise,
(ii) all obligations of Pledgor now or hereafter existing under the
Guarantee dated as of the date of this Agreement (the "Guarantee") by
Pledgor in favor of Lenders, and (iii) all obligations of Pledgor now or
hereafter existing under this Agreement (all such obligations of Borrower
and Pledgor being referred to in this Agreement as the "Obligations").
3. Representations and Warranties. Pledgor represents and warrants as
follows:
(a) The Pledged Shares have been duly authorized and validly
issued and are fully paid and nonassessable. The Pledged Shares
constitute (i) one hundred percent (100%) of the issued and
outstanding shares of the capital stock of each of the Companies,
except for ACT Business Solutions LTD, which is 97.7% owned by the
Pledgor, and except for capital stock required to be owned by foreign
persons under applicable laws. There are no warrants, options or other
rights to acquire any of the capital stock of any Company.
(b) Except for Permitted Liens, Pledgor is the legal and
beneficial owner of the Collateral free and clear of any Lien. No
effective financing statement or other instrument similar in effect
covering all or any part of the Collateral is on file in any recording
office, except such as may have been filed in favor of the Bank
relating to the Bank Indebtedness or Lenders relating to this
Agreement.
(c) The pledge and delivery of the Pledged Shares pursuant to
this Agreement creates a valid and perfected security interest in the
Collateral, securing the payment of the Obligations.
(d) Except for the filing of a UCC financing statement with the
Secretary of State of Colorado and the delivery of stock certificates
as provided below, no authorization, approval or other action by, and
no notice to or filing with any governmental authority or regulatory
body is required either (i) for the grant by Pledgor of the security
interest granted hereby or for the execution, delivery or performance
of this Agreement by Pledgor or (ii) for the perfection of or the
exercise by the Collateral Agent, for the benefit of Lenders, of its
rights and remedies under this Agreement or for the exercise by the
Collateral Agent, for the benefit of Lenders, of the voting or other
rights provided for in this Agreement or the remedies in respect of
the 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).
(e) Pledgor is a corporation duly organized and validly existing
under the laws of its jurisdiction of organization and has full power
and authority to make and deliver this Agreement. Pledgor's
organizational number is 19891112372.
(f) The execution, delivery and performance of this Agreement by
Pledgor (i) have been duly authorized by all necessary action of its
officers, directors and stockholders, and (ii) do not and will not
violate the provisions of, or constitute a default under, any
presently applicable law or its charter or bylaws or any agreement
presently binding on it.
(g) This Agreement has been duly executed and delivered by the
authorized officers of Pledgor and constitutes its lawful, binding and
legally enforceable obligation (subject to the Bankruptcy Code (as
defined below) and other similar laws generally affecting the
enforcement of creditors' rights).
(h) The authorization, execution, delivery and performance of
this Agreement do not require notification to, registration with, or
consent or approval by, any federal, state or local regulatory body or
administrative agency.
(i) The outstanding common stock of Pledgor is duly authorized,
validly issued, fully paid and nonassessable.
(j) There are no actions, suits or proceedings pending or
threatened against or affecting Pledgor, or any of its properties,
before any court or governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, that, if
adversely determined, may (i) call into question the legality,
validity or enforceability of this Agreement or any Financing
Document, or (ii) have a material adverse effect on the condition,
financial or otherwise, operations, properties or prospects of
Pledgor.
(k) Pledgor has delivered to the Collateral Agent and Lenders,
concurrently with the execution of this Agreement, (i) a certificate
executed by an authorized officer of Pledgor certifying (A) the
resolutions of the directors of Pledgor authorizing the execution,
performance and delivery of this Agreement, and (B) as true, correct,
complete and in full force and effect, without amendment or revocation
as of the date of this Agreement, Pledgor's charter and bylaws.
(l) Pledgor has delivered to the Collateral Agent certificates
representing the Pledged Shares set forth on the Pledged Shares
schedule.
4. Covenants. Pledgor covenants and agrees that, so long as any part
of the Obligations shall remain unpaid or the Note Agreement remains in
effect, Pledgor shall:
(a) Not, without the prior written consent of Lender, create or
suffer to exist any Lien or any other type of preferential arrangement
upon or with respect to the Collateral, or assign any right to receive
income, in each case to secure any indebtedness of any Person, other
than Permitted Liens
(b) Not sell, assign (by operation of law or otherwise) or
otherwise dispose of any of the Collateral.
(c) Cause each Company not to issue any shares of stock,
securities, warrants, options or other acquisition rights in addition
to or in substitution for the Pledged Shares issued by such entity,
except to Pledgor
(d) Pledge under this Agreement, immediately upon acquisition
(directly or indirectly), any and all additional shares of stock or
other securities, warrants, options or other acquisition rights of a
Company received or acquired by Pledgor.
5. Further Assurances. Pledgor hereby agrees that:
(a) From time to time, at the expense of Pledgor, Pledgor will
promptly execute and deliver all further instruments and documents,
and take all further action that may be necessary or desirable, or
that the Collateral Agent may request, for the benefit of Lenders, in
order to perfect and protect any security interest granted or
purported to be granted hereby or to enable the Collateral Agent, for
the benefit of Lenders, to exercise and enforce its right and remedies
under this Agreement with respect to any Collateral.
(b) Pledgor will furnish to the Collateral Agent and each Lender
from time to time statements and schedules further identifying and
describing the Collateral and such other reports in connection with
the Collateral as the Collateral Agent may reasonably request, all in
reasonable detail.
6. Voting Rights.
(a) So long as no Event of Default shall have occurred and be
continuing:
(i) Pledgor shall be entitled to exercise any and all voting
and other consensual rights pertaining to the Collateral for any
purpose not inconsistent with the terms of this Agreement or the
Note Agreement; provided, however, that Pledgor shall not
exercise or refrain from exercising any such right if, in the
judgment of the Collateral Agent, such action or inaction would
have a material adverse effect on the value of the Collateral or
any part thereof, and, provided, further, that Pledgor shall give
the Collateral Agent prior written notice of the manner in which
it intends to exercise, or the reasons for refraining from
exercising, any right pertaining to the Collateral or any part
thereof which is material to the interests of the Collateral
Agent and Lenders.
(ii) The Collateral Agent shall execute and deliver (or
cause to be executed and delivered), to Pledgor, on behalf of
Lenders, all such proxies and other instruments as Pledgor may
reasonably request for the purpose of enabling Pledgor to
exercise the voting and other rights that it is entitled to
exercise pursuant to paragraph (i) above.
(b) Upon the occurrence of an Event of Default, and after notice
to Pledgor by the Collateral Agent, all rights of Pledgor to exercise
the voting and other consensual rights that it would otherwise be
entitled to exercise pursuant to Section 6(a)(i) shall cease, and all
such rights shall thereupon become vested in the Collateral Agent, for
the benefit of Lenders, who shall thereupon have the sole right to
exercise such voting and other consensual rights.
7. Appointment as Attorney-in-Fact.
(a) Pledgor hereby irrevocably constitutes and appoints the
Collateral Agent and any partner, officer or agent of the Collateral
Agent, with full power of substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in its
place and stead and in its name or in its own name, from time to time,
in the Collateral Agent's discretion, for the purpose of carrying out
the terms of this Agreement or any Financing Document to the extent
permitted by applicable law, to take any and all appropriate action
and to execute any and all documents and instruments which may be
necessary or desirable to accomplish the purposes of this Agreement,
any Financing Document and, without limiting the generality of the
foregoing, hereby gives the Collateral Agent, for the benefit of
Lenders, subject to the other terms of this Agreement, the power and
right, on behalf of Pledgor, without notice to or assent by Pledgor to
do the following:
(i) upon the occurrence and continuance of an Event of
Default, to pay or discharge taxes or Liens levied or placed on
or threatened against the Collateral which are not permitted by
the terms of this Agreement;
(ii) to receive payment of and receipt for any and all
moneys, claims and other amounts due or to become due at any time
in respect of or arising out of any Collateral; and
(iii) upon the occurrence and continuance of an Event of
Default, (A) to commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent
jurisdiction and to collect the Collateral or any Proceeds
thereof and to enforce any other right in respect of any
Collateral; (B) to defend any suit, action or proceeding brought
against Pledgor with respect to any Collateral; (C) to settle,
compromise or adjust any suit, action or proceeding described
above and, in connection therewith, to give such discharges or
releases as the Collateral Agent may deem appropriate; and (D)
except to the extent prohibited by law, generally to sell,
transfer, pledge, make any agreement with respect to or otherwise
deal with any of the Collateral as fully and completely as though
the Collateral Agent, for the benefit of Lenders, were the
absolute owner thereof for all purposes, and to do, at the
Collateral Agent's option and Pledgor's expense, at any time, or
from time to time, all acts and things which the Collateral Agent
reasonably deems necessary to protect, preserve or realize upon
the Collateral and the security interest of the Collateral Agent,
for the benefit of Lenders, therein, in order to effect the
intent of this Agreement, all as fully and effectively as Pledgor
might do.
Pledgor hereby ratifies all that said attorneys shall
lawfully do or cause to be done by virtue of this Agreement and
in accordance herewith. This power of attorney is a power coupled
with an interest and shall be irrevocable.
(b) Pledgor also authorizes the Collateral Agent, for the benefit
of Lenders, at any time and from time to time, to execute, in
connection with any sale provided for in Section 9 of this Agreement,
any endorsements, assignments or other instruments of conveyance or
transfer with respect to the Collateral.
8. Collateral Agent May Perform. If Pledgor fails to perform any
agreement contained in this Agreement, the Collateral Agent, for the
benefit of Lenders, may itself perform, or cause performance of, such
agreement, and the expenses of Lender incurred in connection therewith
shall be payable by Pledgor under Section 10(a).
9. Duties of Collateral Agent. The powers conferred on the Collateral
Agent, for the benefit of Lenders, under this Agreement are solely to
protect the interest of the Collateral Agent, for the benefit of Lenders,
in the Collateral and shall not impose any duty upon it to exercise any
such powers. Except for the safe custody of any Collateral in its
possession, the Collateral Agent shall not have any duty as to any
Collateral or as to the taking of any necessary steps to preserve rights
against prior parties or any other rights pertaining to any Collateral. The
Collateral Agent shall be deemed to have exercised reasonable care in the
custody and preservation of the Collateral in its possession if the
Collateral is accorded treatment substantially equal to that which the
Collateral Agent accords its own property, it being understood that the
Collateral Agent shall not have any responsibility or liability for (i)
ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Collateral,
whether or not the Collateral Agent has or is deemed to have knowledge of
such matters, (ii) taking any necessary steps to preserve rights against
any parties with respect to any Collateral, or (iii) the collection of any
proceeds of any Collateral.
10. Remedies. If any Event of Default shall have occurred and be
continuing:
(a) the Collateral Agent, for the benefit of Lenders, may
exercise in respect of the Collateral, in addition to other rights and
remedies provided for in this Agreement or otherwise available to it,
all the rights and remedies of a secured party on default under the
UCC (whether or not the UCC applies to the affected Collateral) and
also may (i) exercise any and all rights and remedies of Pledgor in
respect of the Collateral, (ii) manage and control the Collateral and
do any acts which it deems necessary or desirable to preserve the
value or marketability of the Collateral, or any part thereof or
interest therein, all without prior notice to Pledgor, except as
specifically provided below with respect to a formal public or private
sale and, after deducting the expenses of preserving the Collateral,
including, without limitation, just and reasonable compensation for
its services and for all attorneys, counsel, agents, clerks, servants
and other employees by it engaged and employed, shall apply the net
proceeds of the Collateral pursuant to the provisions of this
Agreement, and (iii) without notice except as specified below, sell
the Collateral or any part thereof in one or more parcels at public or
private sale, at any of the Collateral Agent's offices or elsewhere,
for cash, on credit or for future delivery, and upon such other terms
as the Collateral Agent may deem commercially reasonable. Nothing
contained in this Agreement shall be construed to impose upon the
Collateral Agent any obligation to preserve or protect the Collateral
following the occurrence of an Event of Default. Pledgor agrees that,
to the extent notice of sale shall be required by law, at least ten
(10) days' notice to Pledgor of the time and place of any public sale
or the time after which any private sale is to be made shall
constitute reasonable notification. The Collateral Agent shall not be
obligated to make any sale of Collateral regardless of notice of sale
having been given. The Collateral Agent may adjourn any public or
private sale from time to time by announcement at the time and place
fixed therefor, and such sale may, without further notice, be made at
the time and place to which it was so adjourned.
(b) Pledgor recognizes and acknowledges that the Collateral Agent
may be unable to effect a public sale of all or a part of the
Collateral by reason of certain prohibitions contained in the
Securities Act of 1933, as amended, as now or hereafter in effect, or
in applicable blue sky or other state securities laws, as now or
hereafter in effect, but may be compelled to resort to one or more
private sales to a restricted group of purchasers who will be obliged
to agree, among other things, to acquire such Collateral for their own
account, for investment and not with a view to the distribution or
resale thereof. Pledgor agrees that private sales so made may be at
prices and other terms less favorable to the seller than if such
Collateral were sold at public sales, and that the Collateral Agent
has no obligation to delay sale of any such Collateral for the period
of time necessary to permit the applicable Company, even if such
Company would agree, to register such collateral for public sale under
such applicable securities laws. Pledgor agrees that private sales
made under the foregoing circumstances shall not be deemed to have
been made in a commercially unreasonable manner by that fact alone.
(c) All payments received by Pledgor under or in connection with
any Collateral shall be received in trust for the benefit of the
Collateral Agent, on behalf of Lenders, shall be segregated from other
funds of Pledgor and shall be forthwith paid over to the Collateral
Agent for the benefit of Lenders in the same form as so received (with
any necessary endorsement).
(d) All payments made under or in connection with any Collateral
and all cash proceeds received by the Collateral Agent, for the
benefit of Lenders, in respect of any sale of, collection from, or
other realization upon all or any part of the Collateral may, in the
discretion of the Collateral Agent, be held by the Collateral Agent,
for the benefit of Lenders, as collateral for, and/or then or at any
time thereafter applied (after payment of any amounts payable to the
Collateral Agent, for the benefit of Lenders, pursuant to Section 11)
in whole or in part by the Collateral Agent, for the benefit of
Lenders, to all or any part of the Obligations, in such order as the
Collateral Agent shall elect. Any surplus of such cash or cash
proceeds held by the Collateral Agent, for the benefit of Lenders, and
remaining after payment in full of all the Obligations shall be paid
over to Pledgor or to whomsoever may be lawfully entitled to receive
such surplus.
11. Indemnity and Expenses.
(a) Pledgor agrees to indemnify the Collateral Agent from and
against any and all claims, losses and liabilities growing out of or
resulting from this Agreement (including, without limitation,
enforcement of this Agreement), except claims, losses or liabilities
resulting from the Collateral Agent's gross negligence or willful
misconduct.
(b) Pledgor will upon demand pay to the Collateral Agent the
amount of any and all reasonable expenses, including the attorneys
fees and fees of any experts and agents, which the Collateral Agent
may incur in connection with (i) the administration of this Agreement,
(ii) the custody, preservation, or the sale of, collection from, or
other realization upon, any of the Collateral, as provided for in this
Agreement, (iii) the exercise or enforcement of any of the rights of
the Collateral Agent, for the benefit of Lenders, under this Agreement
or (iv) the failure by Pledgor to perform or observe any of the
provisions of this Agreement.
12. Security Interest Absolute. All rights of the Collateral Agent,
for the benefit of Lenders, and security interests under this Agreement,
and all obligations of Pledgor under this Agreement, shall be absolute and
unconditional, irrespective of:
(a) any lack of validity or enforceability of the Note Agreement,
the Guarantee, and the Financing Documents or any other agreement or
instrument evidencing all or any part of the Obligations;
(b) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations or any other
amendment or waiver of or any consent to any departure from the Note
Agreement, the Guarantee, or any other Financing Document;
(c) the absence of any attempt to collect the Obligations from
any guarantor or other action to enforce the same;
(d) the waiver or consent by the Collateral Agent or Lenders with
respect to any provision of any instrument evidencing the Obligations,
or any part thereof, or any other agreement now or hereafter executed
by Pledgor and delivered to the Collateral Agent or Lenders;
(e) failure by the Collateral Agent to take any steps to perfect
and maintain its security interest in, or preserve its rights to, any
security or collateral for the Obligations;
(f) the Collateral Agent's election in any proceeding instituted
under Chapter 11 of Title 11 of the United States Code (11 U.S.C.
Section 101 et seq.) (the "Bankruptcy Code"), of the application of
Section 1111(b)(2) of the Bankruptcy Code;
(g) any borrowing or grant of a security interest under Section
364 of the Bankruptcy Code;
(h) any exchange, release or non-perfection of any other
collateral; or
(i) any other circumstance that might otherwise constitute a
defense available to, or a discharge of, Pledgor.
13. Waiver. Except as otherwise expressly required by the terms of
this Agreement, Pledgor hereby waives diligence, presentment, demand of
payment, filing of claims with a court in the event of receivership or
bankruptcy of Pledgor, protest or notice with respect to the Obligations
and all demands whatsoever, and covenants that this Agreement will not be
discharged, except by complete performance of the Obligations. Upon any
Event of Default as provided in the Note Agreement, the Guarantee, the
Financing Documents, or any other instrument or document evidencing all or
any part of the Obligations, the Collateral Agent, for the benefit of
Lenders, may, at its sole election, proceed directly and at once, without
notice, against Pledgor to recover the full amount or any portion of the
Obligations by exercising its rights provided in ss.10 of this Agreement,
without first proceeding against any other Person or against any security
or collateral for the Obligations. The Collateral Agent shall have the
exclusive right to determine the application of payments and credits, if
any, from Pledgor or from any other Person on account of the Obligations or
of any other liability of Borrower or Pledgor to the Collateral Agent, for
the benefit of Lenders.
14. Amendments; Etc. No amendment or waiver of any provision of this
Agreement nor consent to any departure by Pledgor from the requirements of
this Agreement shall be effective unless the such amendment, waiver or
consent is in writing and signed by the Collateral Agent and the Majority
Purchaser, and then such amendment, waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
15. Notices. Any notice or notification required, permitted or
contemplated under this Agreement shall be provided in accordance with the
provisions of the Note Agreement
16. Continuing Security Interest; Assignment; Termination. This
Agreement shall create a continuing security interest in the Collateral and
shall (a) remain in full force and effect until payment in full of all of
the Obligations, (b) be binding upon Pledgor, its successors and assigns
and (c) inure, together with the rights and remedies of the Collateral
Agent, for the benefit of Lenders, under this Agreement, to the Collateral
Agent and Lenders and their respective successors, transferees and assigns.
Without limiting the generality of the foregoing clause (c), the Collateral
Agent and Lenders may assign or otherwise transfer any instrument held by
it to any other person or entity, and such other person or entity shall
thereupon become vested with all the benefits in respect thereof granted to
them in this Agreement or otherwise. Upon the payment in full of all
Obligations and the termination of any and all obligations of Borrower
under the Note Agreement, the security interest granted hereby shall
terminate and all rights to the Collateral shall revert to Pledgor. Upon
any such termination, the Collateral Agent, on behalf of Lenders, shall, at
Pledgor's expense, execute and deliver to Pledgor such documents as Pledgor
shall reasonably request to evidence such termination.
17. Governing Law; Terms. This Agreement shall be governed by and
construed in accordance with the laws of the State of Colorado, except to
the extent that the validity or perfection of the security interest under
this Agreement, or remedies under this Agreement, in respect of any
particular Collateral are governed by the laws of a jurisdiction other than
the State of Colorado. Unless otherwise defined in this Agreement or in the
Note Agreement, terms used in Article 9 of the UCC are used in this
Agreement as defined in the UCC.
18. Consent to Jurisdiction. PLEDGOR HEREBY CONSENTS TO THE
JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN THE COUNTY OF
DENVER, STATE OF COLORADO AND IRREVOCABLY AGREES THAT, SUBJECT TO THE
COLLATERAL AGENT'S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE OTHER FINANCING DOCUMENTS SHALL BE
LITIGATED IN SUCH COURTS. PLEDGOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH
ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE
JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON
CONVENIENS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED
THEREBY IN CONNECTION WITH THIS AGREEMENT, THE NOTE, OR ANY OTHER FINANCING
DOCUMENT. PLEDGOR DESIGNATES AND APPOINTS CT CORPORATION SYSTEM AND SUCH
OTHER PERSONS AS MAY HEREAFTER BE SELECTED BY PLEDGOR WHICH IRREVOCABLY
AGREE IN WRITING TO SO SERVE AS ITS AGENT TO RECEIVE ON ITS BEHALF SERVICE
OF ALL PROCESS IN ANY SUCH PROCEEDINGS IN ANY SUCH COURT, SUCH SERVICE
BEING HEREBY ACKNOWLEDGED BY PLEDGOR TO BE EFFECTIVE AND BINDING SERVICE IN
EVERY RESPECT. A COPY OF ANY SUCH PROCESS SO SERVED SHALL BE MAILED BY
LENDER BY REGISTERED MAIL TO PLEDGOR AT ITS ADDRESS PROVIDED IN SECTION 15
AND SHALL BE DEEMED TO HAVE BEEN RECEIVED BY PLEDGOR FIVE (5) DAYS AFTER
BEING SO MAILED. IF ANY AGENT APPOINTED BY PLEDGOR REFUSES TO ACCEPT
SERVICE, PLEDGOR HEREBY AGREES THAT SERVICE UPON IT BY MAIL SHALL
CONSTITUTE SUFFICIENT NOTICE. NOTHING IN THIS AGREEMENT SHALL AFFECT THE
RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT
THE RIGHT OF PURCHASER TO BRING PROCEEDINGS AGAINST PLEDGOR IN THE COURTS
OF ANY OTHER JURISDICTION.
19. Waiver of Jury Trial. EACH OF PLEDGOR AND COLLATERAL AGENT HEREBY
WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON,
ARISING OUT OF, OR IN ANY WAY RELATING TO: (A) THIS AGREEMENT OR ANY OF THE
FINANCING DOCUMENTS, OR (B) ANY OTHER PRESENT OR FUTURE INSTRUMENT OR
AGREEMENT BETWEEN LENDER AND PLEDGOR; OR (C) ANY CONDUCT, ACTS OR OMISSIONS
OF PLEDGOR OR THE COLLATERAL AGENT OR ANY OF THEIR DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS, PARTNERS, REPRESENTATIVES, ATTORNEYS OR ANY OTHER
PERSONS AFFILIATED WITH PLEDGOR OR THE COLLATERAL AGENT; IN EACH OF THE
FOREGOING CASES, WHETHER SOUNDING IN TORT OR OTHERWISE. PLEDGOR AND THE
COLLATERAL AGENT ALSO WAIVES ANY BOND OR SURETY OR SECURITY UPON SUCH BOND
WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED OF THE COLLATERAL AGENT. THE
SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL
DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT
MATTER OF THIS AGREEMENT, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF
DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. PLEDGOR AND THE
COLLATERAL AGENT ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO
ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THE
WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT EACH WILL CONTINUE TO RELY
ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS. THIS WAIVER IS IRREVOCABLE,
MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE
WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT, THE FINANCING DOCUMENTS, OR TO ANY OTHER
DOCUMENTS OR AGREEMENTS RELATING TO THE NOTE. EACH OF PLEDGOR AND THE
COLLATERAL AGENT FURTHER WARRANTS AND REPRESENTS THAT EACH HAS REVIEWED
THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY
WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN
THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT
TO A TRIAL BY THE COURT.
20. Security Interest in favor of Bank. To the extent that any
obligation of Pledgor pursuant to this Agreement is inconsistent with the
obligations of Pledgor to Vectra Bank Colorado, National Association, then
the terms of such obligations to Vectra Bank Colorado, National Association
shall govern, pursuant to and to the extent provided in the terms and
conditions of the Intercreditor Agreement among Vectra Bank Colorado,
National Association and the Lenders dated as of the date of this
Agreement.
IN WITNESS WHEREOF, Pledgor has caused this Agreement to be duly executed and
delivered by their officers/managers thereunto duly authorized as to the date
first above written.
PLEDGOR: ACT Teleconferencing, Inc.
By: ______________________________
Name:
Title:
Accepted in Denver, Colorado, as of May 12, 2003.
COLLATERAL AGENT FOR THE BENEFIT OF LENDERS:
NewWest Mezzanine Fund LP
By Touchstone Capital Group LLLP, General Partner
-----------------------------------
Xxxxx X. Xxxxx, Managing General Partner
