PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of March 3, 1997 between XXXXXXX XXXXXX AND
XXXXXX XXXXXX (the "Pledgors") and XXXXXX GUARANTY TRUST COMPANY OF NEW YORK
(the "Bank").
WHEREAS, the Bank may extend loans or other credit facilities or
financial accommodations (collectively, the "Loans") to or on behalf of
either or both of the Pledgors;
NOW, THEREFORE, to induce the Bank to extend the Loans and to secure
their obligations (collectively, the "Secured Obligations") with regard
thereto, for good consideration, the receipt and adequacy of which are hereby
acknowledged, the Pledgors and the Bank agree as follows:
1. As collateral security for the performance of the Secured
Obligations, the Pledgors hereby pledge and assign to the Bank, and grant to
the Bank a security interest in, all assets and property now and hereafter
maintained on deposit by the Pledgors in Custody Account No. 89318 at the
Bank (such assets and property being hereinafter referred to as the
"Collateral" and such account being hereinafter referred to as the
"Collateral Account"). Upon the consent of the Bank the Pledgors may from
time to time withdraw portions of the Collateral and substitute other
property acceptable to the Bank therefor, which substituted property shall
then be deemed to constitute a portion of the Collateral, provided, that the
Pledgors shall at all times maintain Collateral in the Collateral Account
having a lending value, as determined by the Bank in its sole discretion, at
least equal to the Dollar amount of the Secured Obligations.
2. A. The Pledgors represent and warrant that all of the contents of
the Collateral Account are and will be validly and duly pledged to the Bank
in accordance with law, and agree to defend the Bank's right, title, lien and
security interest in and to the Collateral against the claims and demands of
all persons whomsoever. The Pledgors also represent and warrant to the Bank
that they have, and will have upon deposit with the Bank, title to all of the
contents of the Collateral Account, free and clear of all claims, mortgages,
pledges, liens, encumbrances and security interests of every nature
whatsoever, and that no consent or approval of any governmental or regulatory
authority, or of any securities exchange, was or is necessary to the validity
of this pledge.
B. The Pledgors will faithfully preserve and protect the Bank's
security interest in the Collateral and will do all such acts and things and
execute and deliver all such documents and instruments, including without
limitation further pledges, assignments, financing statements and
continuation statements, as the Bank in its sole discretion may reasonably
deem necessary or advisable from time to time in order to preserve, protect
and perfect such security interest. The Pledgors hereby authorize the Bank
to sign and file financing and continuation statements without the signature
of the Pledgors.
C. The Pledgors represent and warrant that no liens, security
interests or adverse claims other than in favor of the Bank exist upon any of
the contents of the Collateral Account. The Pledgors will not permit any
liens, security interests or adverse claims other than in favor of the Bank
to exist upon any of the contents of the Collateral Account. The Pledgors
shall not enter into any agreement imposing any restrictions on the
transferability of the Collateral or that would otherwise lessen in any way
its value as collateral.
3. If at any time the Secured Obligations shall be in default the Bank
may cause all or any of the Collateral to be transferred to or registered in
its name or the name of its nominee or nominees.
4. In the event the Secured Obligations shall be in default (i) all
dividends, interest and other distributions at any time and from time to time
declared or paid upon any of the Collateral shall become part of the
Collateral and (ii) the Bank shall be entitled to exercise all voting power
with regard to the Collateral.
5. If any of the Secured Obligations shall not be performed forthwith
as and when due in accordance with their terms, the Bank, without obligation
to resort to other security, shall have the right at any time and from time
to time to sell, resell, assign and deliver, in its discretion, all or any of
the Collateral, in one or more parcels at the same or different times, and
all right, title and interest, claim and demand therein and right of
redemption thereof, on any securities exchange on which the Collateral or any
of it may be listed, or at public or private sale, for cash, upon credit or
for future delivery, and in connection therewith the Bank may grant options,
the Pledgors hereby waiving and releasing any and all equity or right of
redemption. If any of the Collateral is sold by the Bank upon credit or for
future delivery, the Bank shall not be liable for the failure of the
purchaser to purchase or pay for the same and, in the event of any such
failure, the Bank may resell such Collateral. In no event shall the Pledgors
be credited with any part of the proceeds of sale of any Collateral until
cash payment thereof has actually been received by the Bank. In addition,
should any portion of the Collateral consist of a time deposit or deposits
with a financial institution, the Bank may terminate such deposit or deposits
prior to the maturity thereof and any penalties payable in connection
therewith shall be for the sole account of the Pledgors.
6. No demand, advertisement or notice, all of which are hereby
expressly waived, shall be required in connection with any sale or other
disposition of any part of the Collateral which threatens to decline speedily
in value or which is of a type customarily sold on a recognized market;
otherwise the Bank shall give the Pledgors at least five business days' prior
notice of the time and place of any public sale and of the time after which
any private sale or other disposition is to be made, which notice the
Pledgors agree is reasonable, all other demands, advertisements and notices
being hereby waived. The Bank shall not be obligated to make any sale of
Collateral if it shall determine not to do so, regardless of the fact that
notice of sale may have been given. The Bank may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for
sale, and such sale may, without further notice, be made at the time and
place to which the same was so adjourned. In the case of all sales of
Collateral, public or private, the Pledgors shall pay all costs and expenses
of every kind for sale or delivery, including brokers' and attorneys' fees,
and after deducting such costs and expenses from the proceeds of sale, the
Bank shall apply any residue to the payment of principal, interest and other
amounts owed with regard to the Secured Obligations. The balance, if any,
remaining after payment in full of all such amounts shall be paid to the
Pledgors, subject to any duty of the Bank imposed by law to the holder of any
subordinate security interest in the Collateral known to the Bank.
7. The Pledgors recognize that the Bank 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.
The Pledgors agree 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 Bank has no obligation to delay sale of any such
Collateral for the period of time necessary to permit the issuer of such
Collateral, even if such issuer would agree, to register such Collateral for
public sale under such applicable securities laws. The Pledgors agree that
private sales made under the foregoing circumstances shall be deemed to have
been made in a commercially reasonable manner.
8. The remedies provided herein in favor of the Bank shall not be
deemed exclusive, but shall be cumulative, and shall be in addition to all
other remedies in favor of the Bank existing at law or in equity.
9. The Bank shall have the right, for and in the name, place and stead
of the Pledgors, to execute endorsements, assignments or other instruments of
conveyance or transfer with respect to all or any of the Collateral.
10. The Bank shall have no duty as to the collection or protection of
the Collateral or any income thereon or as to the preservation of any rights
pertaining thereto, beyond the safe custody of any thereof actually in its
possession. With respect to any maturities, calls, conversions, exchanges,
redemptions, offers, tenders or similar matters relating to any of the
Collateral (herein called "events"), the Bank's duty shall be fully satisfied
if (i) the Bank exercises reasonable care to ascertain the occurrence and to
give reasonable notice to the Pledgors of any events applicable to any
Collateral which is registered and held in the name of the Bank or its
nominee, (ii) the Bank gives the Pledgors reasonable notice of the occurrence
of any events, of which the Bank has received actual knowledge, as to any
securities which are in bearer form or are not registered and held in the
name of the Bank or its nominee (the Pledgors agreeing to give the Bank
reasonable notice of the occurrence of any events applicable to any
securities in the possession of the Bank of which the Pledgors have received
knowledge), and (iii) in the exercise of its sole discretion (a) the Bank
endeavors to take such action with respect to any of the events as the
Pledgors may reasonably and specifically request in writing in sufficient
time for such action to be evaluated and taken or (b) if the Bank determines
that the action requested might adversely affect the value of the Collateral
as collateral, the collection of the Loans, or otherwise prejudice the
interests of the Bank, the Bank gives reasonable notice to the Pledgors that
any such requested action will not be taken and if the Bank makes such
determination or if the Pledgors fail to make such timely request, the Bank
takes such other action as it deems advisable in the circumstances. Except
as hereinabove specifically set forth, the Bank shall have no further
obligation to ascertain the occurrence of, or to notify the Pledgors with
respect to, any events and shall not be deemed to assume any such further
obligation as a result of the establishment by the Bank of any internal
procedures with respect to any securities in its possession. The Pledgors
release the Bank from any claims, causes of action and demands at any time
arising out of or with respect to this Agreement, the Collateral and/or any
actions, taken or omitted to be taken by the Bank with respect thereto, and
the Pledgors hereby agree to hold the Bank harmless from and with respect to
any and all such claims, causes of action and demands.
11. The Pledgors hereby irrevocably appoint the Bank as their
attorney-in-fact for the purpose of carrying out the provisions of this
Agreement and taking any action and executing any instrument which either may
deem necessary or advisable to accomplish the purposes hereof. Without
limiting the generality of the foregoing, the Bank shall have the right and
power to receive, endorse and collect all checks and other orders for the
payment of money made payable to the Pledgors representing any interest or
dividend or other distribution payable in respect of the Collateral or any
part thereof and to give full discharge for the same.
12. No delay on the part of the Bank in exercising any of its options,
powers or rights, or partial or single exercise thereof, shall constitute a
waiver thereof.
13. Upon the repayment in full of all principal, interest and other
amounts that may be payable with regard to the Loans and the Bank's having
determined that no contingent obligations of either Pledgors that it wishes
to remain secured hereunder shall exist, the Pledgors shall be entitled to
the return of all of the Collateral and of all other property and cash which
have not been used or applied toward the payment of such principal, interest
and other amounts free and clear of all liens in favor of the Bank or any
encumbrances imposed by the Bank. Except as aforesaid, the assignment by the
Bank to the Pledgors of such Collateral and other property shall be without
representation or warranty of any nature whatsoever and wholly without
recourse.
14. Any notice, demand or service of process upon the Pledgors shall be
deemed to have been sufficiently given for all purposes thereof if mailed,
postage prepaid, by registered or certified mail, return receipt requested,
or if delivered, to the Pledgors at the address specified below, or at such
other address as the Pledgors may theretofore have designated in writing and
given in like manner to the Bank.
15. Any waiver, permit, consent or approval of any kind or character on
the part of the Bank of any breach or default under this Agreement or any
such waiver of any provision or condition of this Agreement must be in
writing and shall be effective only to the extent specifically set forth in
such writing.
16. This Agreement and the rights and obligations of the Bank and the
Pledgors hereunder shall be construed in accordance with and governed by the
laws of the State of New York, cannot be changed orally and shall bind and
inure to the benefit of the Pledgors and the Bank and their respective
successors and assigns, all subsequent holders of the Secured Obligations and
to the Pledgors' heirs, executors and legal representatives. The Pledgors
hereby submit to the nonexclusive jurisdiction of the United States District
Court for the Southern District of New York and of any New York State Court
sitting in New York City for purposes of all legal proceedings arising out of
or relating to this Agreement or any agreement received by the Bank in
connection herewith. The Pledgors irrevocably waive, to the fullest extent
permitted by law, any objection which they may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any
claim that any such proceeding brought in such a court has been brought in an
inconvenient forum. The Pledgors hereby irrevocably waive any and all right
to trial by jury in any legal proceeding arising out of or relating to this
Agreement or any agreement received by the Bank in connection herewith.
17. This Agreement may be executed in any number of counterparts, each
of which shall be deemed an original and all of which taken together shall
constitute but one and the same instrument.
18. This Agreement replaces all prior agreements between the Pledgors
and the Bank relating to the Collateral contained in any promissory note
delivered to the Bank by the Pledgors.
19. The Pledgors agree to pay the Bank on demand all costs, including
legal fees, incurred by the Bank in connection with the administration and
enforcement of this Agreement.
20. The Pledgors shall be jointly and severally liable.
IN WITNESS WHEREOF, the Pledgors and the Bank have caused this Agreement
to be duly executed as of the day and year first above written.
/s/ Xxxxxxx Xxxxxx
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Xxxxxxx Xxxxxx
/s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx
Address:
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK
By: /s/ Xxxxxxx X. Xxxxxxxx
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Xxxxxxx X. Xxxxxxxx,
Vice President
Address:
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
