PLEDGE AGREEMENT
This PLEDGE AGREEMENT is entered into as of August 23, 2005, among (i)
XXXXXXXXXX COMMUNICATIONS COMPANY, a Delaware corporation (the "Borrower"), (ii)
XXXXXXXXXX GROUP, INC., a Delaware corporation ("AGI"), (iii) Allfinco, Inc., a
Delaware corporation ("Allfinco"), (iv) any other party who from time to time
may become, or may be required to become, a pledgor hereunder (together with the
Borrower, AGI and Allfinco, the "Pledgors") and (v) BANK OF AMERICA, N.A., as
Agent, for the Secured Parties (as defined below) (in such capacity, the
"Agent").
RECITALS
WHEREAS, the Pledgors are the legal and beneficial owners of the Equity
Interests identified in Attachment 1 hereto;
WHEREAS, the Borrower has entered into a Credit Agreement, dated as of
August 23, 2005 (the "Credit Agreement"), among the Borrower, the financial
institutions which are now, or hereafter become, parties thereto as lenders (the
"Banks"), and Bank of America, N.A., as agent for the Banks, pursuant to which
the Banks have extended commitments to make Loans to the Borrower; and
WHEREAS, it is a condition precedent to the making of Loans under the
Credit Agreement that the Pledgors execute and deliver to the Agent a pledge
agreement substantially in the form hereof.
Accordingly, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
Section 1.1. Certain Terms. The following terms, when used in this
Agreement, including the introductory paragraph and Recitals hereto, shall,
unless the context otherwise requires, have the following meanings:
"Agent" is defined in the introductory paragraph hereto.
"Agreement" means this Pledge Agreement.
"Banks" is defined in the third paragraph of the Recitals hereto.
"Borrower" is defined in the introductory paragraph hereto.
"Credit Agreement" is defined in the third paragraph of the Recitals
hereto.
"Distributions" means all stock dividends, liquidating dividends,
shares of stock resulting from stock splits, combinations, reclassifications,
recapitalization, mergers, consolidations, warrants, options, non-cash dividends
and other dividends or distributions (whether similar or dissimilar to the
foregoing and including but not limited to distributions on or with respect of
any
partnership or limited liability company interest) on or with respect to any
Pledged Shares or other shares of Equity Interests constituting Pledged
Collateral, but shall not mean Dividends.
"Dividends" means cash dividends and cash distributions with respect to
any Pledged Shares made out of capital surplus.
"Equity Interests" means any shares, interests, participations or other
equivalents (howsoever designated) of corporate equity interests or any
equivalent ownership interests in a Person other than a corporation (including
partnership or limited liability company interests) or any options, warrants or
other rights to subscribe for, or to purchase, or to convert any Property into,
or exchange any Property for, any such corporate equity interests, options,
warrants or other rights, or ownership interests in a Person other than a
corporation.
"Initial Pledged Shares" means all issued and outstanding shares of
Equity Interests held, directly or indirectly, by each of the Pledgors in each
Pledged Share Issuer identified on Attachment 1.
"Instrument" means any contract, agreement, indenture, mortgage or
other document or writing (whether a formal agreement, letter or otherwise)
under which any obligation is evidenced, assumed or undertaken, or any right to
any security interest or other lien is granted or perfected.
"Obligations" is defined in the Credit Agreement.
"Permitted Dividends" means any Dividends with respect to any Pledged
Shares made out of capital surplus, to the extent that such Dividends are
permitted by the Credit Agreement.
"Person" shall mean an individual, corporation, partnership, limited
liability company, joint venture, association, estate, joint stock company,
trust, organization, business, or a government or agency or political
subdivision thereof.
"Pledged Collateral" is defined in ss.2.1.
"Pledged Interests" means Pledged Shares that represent ownership
interests in a Person other than a corporation (including partnership or limited
liability company interests) or any options, warrants or other rights to
subscribe for, or to purchase, or to convert any Property into, or exchange any
Property for, any options, warrants or other rights, or ownership interests in a
Person other than a corporation.
"Pledged Share Issuer" means, with respect to the Pledged Shares
identified on Attachment 1, the Person identified as the issuer of such Pledged
Shares on Attachment 1, and any other corporation, partnership or limited
liability company becoming a Pledged Share Issuer hereunder after the date
hereof.
"Pledged Shares" means the Initial Pledged Shares and any and all other
shares of Equity Interests at any time, and from time to time, acquired by any
Pledgor of any Pledged Share Issuer identified on Attachment 1 and all other
shares of Equity Interests which are otherwise delivered
or required to be delivered by any Pledgor to the Agent for the purpose of
pledge hereunder, including without limitation, pursuant to Section 2.3 herein.
"Pledgors" is defined in the introductory paragraph hereto.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, and whether tangible or intangible.
"Secured Parties" means, collectively, the Agent and the Banks.
"U.C.C." means the Uniform Commercial Code as in effect in The
Commonwealth of Massachusetts.
Section 1.2. Credit Agreement Definitions. Unless otherwise defined
herein or the context otherwise requires, terms used in this Agreement,
including the introductory paragraph and Recitals hereto, that are defined in
the Credit Agreement shall have the meanings given to such terms in the Credit
Agreement.
Section 1.3. U.C.C. Definitions. Unless otherwise defined herein or
the context otherwise requires, terms for which meanings are provided in the
U.C.C. are used in this Agreement, including the introductory paragraph and
Recitals hereto, with such meanings.
Section 1.4. General Provisions Relating to Definitions. Terms for
which meanings are defined in this Agreement shall apply equally to the singular
and plural forms of the term defined. Whenever the context may require, any
pronoun, shall include the corresponding masculine, feminine and neuter forms.
The term "including" means including, without limiting the generality of any
description preceding such term. Each reference herein to any Person shall
include a reference to such Person's successors and assigns. References to any
Instrument defined in this Agreement refer to such Instrument as originally
executed or, if subsequently amended or supplemented from time to time, as so
amended or supplemented and in effect at the relevant time of reference thereto.
SECTION 2. PLEDGE
Section 2.1. Grant of Security Interest and Pledge. Each of the
Pledgors hereby pledges, assigns, charges, mortgages, delivers and transfers to
the Agent, for the benefit of the Secured Parties, and hereby grants to the
Agent, for the benefit of the Secured Parties, a continuing pledge and security
interest in and to, all of the following Property of such Pledgor, whether now
owned or hereafter acquired or existing (all of such Property being the "Pledged
Collateral"):
(a) all the Initial Pledged Shares owned by such Pledgor;
(b) all other Pledged Shares owned by such Pledgor;
(c) all Distributions from time to time received by such
Pledgor;
(d) all of the Pledgor's rights and interests under the
charter documents, by-laws, limited liability company operating
agreement or other similar governing document, as applicable, of each
Pledged Share Issuer, including all voting and management rights and
all rights to grant or withhold consents or approvals;
(e) all other Property (including Dividends) that may, from
time to time be delivered or be required to be delivered by such
Pledgor to the Agent for the purpose of pledge hereunder; and
(f) all products and proceeds of any of the foregoing.
Section 2.2. Security for Obligations. This Agreement (and the Pledged
Collateral) secures the prompt payment in full and performance when due of all
and each of the Obligations under the Credit Agreement and the other Loan
Documents. In addition, all advances, charges, costs and expenses, including
reasonable attorneys' fees, incurred or paid by the Agent in exercising any
right, power or remedy conferred by this Agreement, or in the enforcement
hereof, shall, to the extent lawful, become a part of the Obligations secured
hereby.
Section 2.3. Pledge and Delivery of Pledged Collateral. All
certificates or instruments representing or evidencing any Pledged Collateral to
be delivered on the date hereof or hereafter shall be:
(a) delivered to and held by or on behalf of the Agent
pursuant hereto;
(b) in suitable form for transfer by delivery; and
(c) accompanied by all necessary instruments of transfer or
assignment including, with respect to the Pledged Shares represented by
certificates, undated stock powers, duly executed in blank, all in form
and substance satisfactory to the Agent.
Each of the Pledgors shall deliver all of the Initial Pledged Shares owned by
such Pledgor to the Agent on or prior to the date hereof. From and after the
date hereof, each Pledgor shall, immediately upon its receipt thereof, deliver
or cause to be delivered to the Agent in pledge hereunder any and all additional
shares of Equity Interests of any Pledged Share Issuer, and all other Pledged
Collateral (other than Permitted Dividends), issued, distributed or sold to, or
purchased or otherwise acquired by, such Pledgor. Upon the formation by any
Pledgor of any Subsidiary, the acquisition by any Pledgor of or Investment by
any Pledgor in any Person which as a result of such acquisition or Investment
becomes a Subsidiary of such Pledgor, or the receipt by any Pledgor of any
shares of Equity Interests of any Subsidiary of such Pledgor, such Pledgor
shall, immediately upon such formation, acquisition, Investment or receipt,
deliver or cause to be delivered to the Agent in pledge hereunder any and all
shares of Equity Interests of such Subsidiary and all other Pledged Collateral
issued, distributed or otherwise delivered to, or acquired by, such Pledgor in
respect of or relating to such Equity Interests. Each such Subsidiary shall,
immediately upon such formation, acquisition, Investment or receipt, become a
Pledged
Share Issuer and, as applicable, a Pledgor for all purposes of this Agreement.
Each Pledgor shall take all other actions from time to time requested by the
Agent to grant to the Agent a first priority, perfected security interest in all
of the Pledged Collateral. The Agent shall have the right at any time to
exchange certificates or instruments representing or evidencing any Pledged
Shares for certificates or instruments of smaller or larger denominations
Section 2.4. Continuing Security Interest; Transfer of Note. This
Agreement has created and shall create a continuing security interest in all of
the Pledged Collateral and shall:
(a) remain in full force and effect until the later of the
termination of all of the Commitments or payment in full in cash of
each of the Obligations;
(b) be binding upon each Pledgor, and the successors,
transferees and assigns of each Pledgor (provided that no Pledgor may
assign any of its obligations hereunder without the prior written
consent of the Agent); and
(c) inure to the benefit of the Secured Parties and their
successors, transferees and assigns.
Without limiting the foregoing clause (c), any Secured Party may assign or
otherwise transfer (in whole or in part) any Note, Loan or other Obligation held
by it to any other Person or entity in accordance with the terms of the Credit
Agreement, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted in this Agreement or otherwise. Upon the
later to occur of the termination of all of the Commitments or the payment in
full in cash of each of the Obligations, the security interest granted herein by
any Pledgor shall terminate and all rights to the Pledged Collateral of such
Pledgor shall revert to such Pledgor. Upon any such termination of security
interests, the Agent will, at the sole expense of each Pledgor, deliver to such
Pledgor, without any representations, warranties or recourse of any kind
whatsoever, all certificates and instruments representing or evidencing the
Pledged Shares, together with all other Pledged Collateral held by the Agent
hereunder, and will execute and deliver to each Pledgor such documents as such
Pledgor shall reasonably request to evidence such termination.
Section 2.5. Waiver of Certain Provisions: Approval of Pledge. Each
Pledged Share Issuer and each Pledgor irrevocably waives any and all provisions
of the charter documents and by-laws, limited liability company operating
agreement, or other similar governing document, as applicable, of such Pledged
Share Issuer that (a) prohibit, restrict, condition or otherwise affect the
grant hereunder of any lien, security interest, or encumbrance on any of the
Pledged Collateral or any enforcement action which may be taken in respect of
any such lien, security interest or encumbrance, or (b) otherwise conflict with
the terms of this Agreement.
Section 2.6. Security Interest Absolute. All rights of the Agent and
the security interests granted hereunder, and all obligations of each of the
Pledgors hereunder, shall be absolute and unconditional, irrespective of, and
shall not be impaired or affected by:
(a) any lack of validity or enforceability of the Credit
Agreement any other Loan Document, or any Instrument relating to any
thereof or to any of the Obligations;
(b) any change in the corporate existence, structure or
ownership of any of the Pledgors or their Subsidiaries, or any
insolvency, bankruptcy, reorganization or other similar proceeding
affecting any such Person or any Property of any such Person or any
resulting release or discharge of any Obligation contained in the
Credit Agreement or any other Loan Document;
(c) the failure of any Secured Party:
(i) to assert any claim or demand or to enforce any
right or remedy against such Pledgor, any other Pledgor or any other
Person under the provisions of the Credit Agreement or any other Loan
Document or any other Instrument relating to any thereof or under any
applicable law, or
(ii) to exercise any right or remedy against any
Pledged Collateral;
(d) 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
compromise, renewal, extension, acceleration or release with respect
thereto or with respect to the Pledged Collateral, or any other
amendment to, rescission, waiver or other modification of, or any
consent to any departure from, the Credit Agreement or any other Loan
Document or any other Instrument relating to any thereof;
(e) any increase, reduction, limitation, impairment or
termination of the Obligations for any reason, including any claim of
waiver, release, surrender, alteration or compromise, and any defense
or set-off, counterclaim, recoupment or termination whatsoever by
reason of the invalidity, illegality, nongenuineness, irregularity,
compromise, or unenforceability of, or, any other event or occurrence
affecting, any of the Obligations (and each of the Pledgors hereby
waives any right to or claim of any such defense or set-off,
counterclaim, recoupment or termination);
(f) any sale, exchange, release or non-perfection of any
Pledged Collateral, or any release of or amendment to or waiver of or
consent to departure from any guaranty or collateral held by the Agent
or any other Secured Party securing or guaranteeing all or any of the
Obligations;
(g) any defense, set-off or counterclaim which may at any
time be available to or be asserted by any Pledgor against any other
Pledgor or against any Secured Party; or
(h) any other circumstances which might otherwise constitute
a suretyship or other defense available to, or a legal or equitable
discharge of, any of the Pledgors.
SECTION 3. REPRESENTATIONS AND WARRANTIES
Section 3.1. Warranties, etc. Each Pledgor represents and warrants to
the Agent, for the benefit of each of the Secured Parties, as set forth in this
Section. The following representations and warranties will be deemed to be made
as of the date of each pledge by any Pledgor of any Pledged Collateral to the
Agent hereunder.
Section 3.1.1. Ownership. No Liens, etc. Such Pledgor is the sole
holder of record and the sole legal and beneficial owner of, and has good and
marketable title to (and has full right and authority to pledge, assign,
transfer and deliver) all Pledged Collateral purported to be pledged by such
Pledgor to the Agent hereunder, free and clear of all security interests and
other liens, except for liens created by this Agreement in favor of the Agent.
Section 3.1.2. Valid Security Interest. The execution and
delivery of this Agreement by such Pledgor together with the filing of U.C.C.
financing statements in the appropriate offices for the locations of Pledged
Interests, and the delivery by such Pledgor to the Agent of the Pledged
Collateral purported to be pledged by such Pledgor hereunder, is effective to
create, in favor of the Agent for the benefit of the Secured Parties, a valid,
perfected, first-priority security interest in such Pledged Collateral, and no
other filing, action or other approval is or will be necessary to perfect,
protect or enforce such security interest.
Section 3.1.3. Pledged Shares. All of the Pledged Shares
purported to be pledged by such Pledgor hereunder have been duly authorized and
validly issued, are fully paid and non-assessable and constitute all of the
issued and outstanding shares of Equity Interests of the applicable Pledged
Share Issuer held by such Pledgor.
Section 3.1.4. Authorization, Approval, etc. This Agreement has
been duly authorized, executed and delivered by each Pledgor and constitutes a
legal, valid and binding obligation of such Pledgor enforceable in accordance
with its terms. No authorization, approval or other action by any governmental
authority or any shareholder or creditor has been or will be required either
(a) for the pledge by such Pledgor of any Pledged Collateral
required to be pledged by such Pledgor under the terms of this
Agreement, for the execution, delivery or performance of this
Agreement by such Pledgor, or for the validity or enforceability of
any such pledge or this Agreement;
(b) subject to ss.7.11, for the exercise by the Agent of the
voting or other rights provided for in this Agreement; or
(c) except as may be required in connection with any
disposition of Pledged Shares by applicable laws affecting the
offering and sale of securities generally, and subject to ss.7.11, for
the exercise by the Agent of any of the remedies in respect of the
Pledged Collateral purported to be pledged by such Pledgor pursuant to
this Agreement.
SECTION 4. COVENANTS
Section 4.1. Affirmative Covenants of the Pledgor. Each of the Pledgors
covenants and agrees with the Agent, for the benefit of each of the Secured
Parties, and warrants that, until the later of the termination of all the
Commitments or the payment in full in cash of each of the Obligations, the
Pledgors will:
Section 4.1.1. Protect Collateral; Further Assurances, etc.
(a) Defend the right and title herein granted unto the Agent
in and to the Pledged Collateral purported to be pledged by such
Pledgor hereunder (and all right, title and interest represented or
evidenced by such Pledged Collateral) against the claims and demands
of any other Person; promptly execute and deliver all further
Instruments and other assurances, and take, or cause to be taken, all
further action, at the expense of such Pledgor, that may be necessary
or desirable, or that the Agent may request, in order to perfect or
protect any security interest purported to be granted by such Pledgor
under this Agreement or to enable the Agent to exercise or enforce its
rights and remedies hereunder with respect to any Pledged Collateral
purported to be pledged by such Pledgor hereunder; and furnish to the
Agent all such financing statements, certificates, legal opinions and
other documents, and obtain all such authorizations and approvals as
the Agent may request in order to give full effect to this Agreement
and to maintain, preserve, safeguard and continue at all times all or
any of the rights, remedies, powers and privileges of the Agent under
this Agreement.
(b) Comply with all laws, regulations, judicial orders or
decrees applicable to the Pledged Collateral or any portion thereof,
and perform and observe its duties under the charter documents,
by-laws, limited liability company operating agreements, or other
similar governing documents with respect to the Pledged Share Issuers.
(c) Keep and maintain at its own cost and expense at its
principal place of business or the location where Pledged Collateral
is to be kept, as indicated in Section 3.1(f), satisfactory and
complete records of the Pledged Collateral including a record of all
payments received and all other dealings of a material nature with the
Pledged Collateral, and xxxx its books and records pertaining to the
Pledged Collateral to evidence this Agreement and the liens and
security interests granted hereby.
(d) Pay promptly when due any taxes, assessments, and
governmental charges or levies imposed upon the Pledged Collateral or
in respect of its income or profits therefrom, as well as all claims
of any kind except that no such charge need be paid if (i) the
validity thereof is being diligently contested in good faith by
appropriate proceedings; (ii) such proceedings do not involve any
danger of the sale, forfeiture, or loss of any of the Pledged
Collateral or any interest therein; and (iii) such charge is
adequately reserved against in a manner acceptable to the Agent.
(e) Except as otherwise permitted by the Credit Agreement,
do or cause to be done all things necessary to preserve, renew and
keep in full force and effect
the legal existence of each Pledgor and each Pledged Share Issuer, the
power and authority of each Pledgor and each Pledged Share Issuer to
own its property and carry on its business, the qualification of each
Pledgor and each Pledged Share Issuer to do business in its
jurisdiction of organization, and the qualification of each Pledgor
and Pledged Share Issuer to do business in each other jurisdiction
where such qualification is necessary, except where the failure so to
qualify would not have a material adverse effect on the rights and
interests of the Agent hereunder.
Section 4.1.2. Stock Powers. Instruments etc. From time to time
upon the request of the Agent, (a) promptly deliver to the Agent such stock
powers, Instruments and similar documents, satisfactory in form and substance to
the Agent, with respect to the Pledged Collateral purported to be pledged by
such Pledgor hereunder as the Agent may request, and (b) at any time after an
Event of Default has occurred and is continuing, promptly transfer any Pledged
Shares or other shares of Equity Interests constituting any such Pledged
Collateral into the name of any nominee designated by the Agent.
Section 4.1.3. Continuous Pledge. Keep pledged to the Agent
pursuant hereto all Pledged Shares and all other shares of Equity Interests
constituting Pledged Collateral, and all other Pledged Collateral required to be
pledged by such Pledgor hereunder.
Section 4.1.4. Voting Rights; Dividends, etc. Deliver (properly
endorsed where required hereby or requested by the Agent) to the Agent:
(a) promptly upon receipt thereof by such Pledgor, all
Dividends (other than Permitted Dividends), Distributions and other
cash payments and other Property and proceeds received by such Pledgor
in respect of the Pledged Collateral purported to be pledged by such
Pledgor hereunder, all of which shall be held by the Agent as
additional Pledged Collateral for use in accordance with ss.6.2; and
(b) if any Event of Default has occurred and is continuing,
promptly upon request of the Agent, such proxies and other documents
as may be necessary to allow the Agent to exercise the voting power
with respect to any share of Equity Interests (including Pledged
Shares) constituting Pledged Collateral purported to be pledged by
such Pledgor hereunder.
All (i) Dividends, Distributions, cash payments and proceeds which may at any
time and from time to time be held by any Pledgor, but which is then required to
be delivered to the Agent and (ii) additional Pledged Shares received by any of
the Pledgors, shall, in each case, until delivery to the Agent, be held by the
Pledgor holding or receiving such Pledged Collateral separate and apart from its
other Property in trust for the Agent.
Section 4.2. No Other Liens. Each Pledgor agrees with the Agent, for
the benefit of each of the Secured Parties, and warrants that, until the later
of the termination of all of the Commitments or the payment in full in cash of
each of the Obligations, such Pledgor will not sell, assign, transfer, pledge,
hypothecate or otherwise encumber any of the Pledged Collateral (except in favor
of the Agent pursuant to the terms hereof).
Section 4.3. Dividends and Voting Rights Other Than Following an Event
of Default. The Agent agrees with each Pledgor as follows:
(a) unless an Event of Default has occurred and is
continuing, such Pledgor shall be entitled to exercise, in its
reasonable judgment, but in a manner that, would not impair the
Pledged Collateral and that would not be inconsistent with the terms
of this Agreement, the Credit Agreement or any other Loan Document,
the voting power and all other incidental rights of ownership with
respect to the Pledged Shares or other shares of Equity Interests
constituting Pledged Collateral pledged by such Pledgor hereunder; and
(b) unless an Event of Default has occurred and is
continuing, such Pledgor shall be entitled to receive all Permitted
Dividends on the Pledged Shares pledged by such Pledgor hereunder.
The Agent agrees that, unless an Event of Default has occurred and is
continuing, the Agent shall, upon the written request of any Pledgor, promptly
deliver such proxies and other documents, if any, as shall be reasonably
requested by such Pledgor to allow such Pledgor to exercise the rights described
in clause (a).
SECTION 5. THE AGENT
Section 5.1. Agent Appointed Attorney-in Fact. Each Pledgor hereby
irrevocably appoints the Agent, and any officer or agent thereof, such Pledgor's
attorney-in-fact, with full authority in the place and stead of such Pledgor and
in the name of such Pledgor or otherwise, from time to time in the Agent's
discretion, to take any and all action and to execute any Instrument or other
assurance which the Agent may deem necessary or advisable to accomplish the
purposes of this Agreement, including:
(a) if an Event of Default has occurred and is continuing,
to ask, demand, collect, xxx for, recover, compromise, receive and
give acquittance and receipts for moneys due and to become due under
or in respect of any of the Pledged Collateral pledged by such Pledgor
hereunder;
(b) to receive, endorse and collect any drafts or other
Instruments in connection with clause (a);
(c) to execute and do all such assurances, acts and things
which such Pledgor ought to do under the covenants and provisions of
this Agreement;
(d) to take any and all actions as the Agent may, in its
sole and absolute discretion, determine to be necessary or advisable
for the purpose of maintaining, preserving or protecting the security
constituted by this Agreement or any of the rights, remedies, powers
or privileges of the Agent under this Agreement; and
(e) generally, in the name of such Pledgor or in the name of
the Agent to exercise all or any of the powers, authorities and
discretions conferred on or reserved to the Agent pursuant to this
Agreement.
Each Pledgor hereby ratifies and confirms, and hereby agrees to ratify and
confirm, whatever the Agent shall do or purport to do in the proper exercise of
the power of attorney granted to the Agent pursuant to this ss.5.1, which power
of attorney, being given for security, is irrevocable.
Section 5.2. Agent Has No Duty. The powers conferred on the Agent
hereunder are solely to protect its interest (on behalf of the Secured Parties)
in the Pledged Collateral and shall not impose any duty on it to exercise any
such powers. Except as provided in ss.5.1 and except for accounting for moneys
actually received by it hereunder, the Agent shall have no duty as to any
Pledged Collateral or responsibility for taking any necessary steps to preserve
rights against prior parties or any other rights pertaining to any Pledged
Collateral except as otherwise required by the U.C.C.
Section 5.3. Reasonable Care. The Agent will exercise reasonable care
in the custody and preservation of the Pledged Collateral in its possession;
provided, however, that the Agent shall be deemed to have exercised reasonable
care in the custody and preservation of such Pledged Collateral if it takes such
action for that purpose as any Pledgor reasonably requests in writing at times
other than during the continuance of an Event of Default, but failure of the
Agent to comply with any such request at any time shall not in itself be deemed
a failure to exercise reasonable care.
SECTION 6. REMEDIES
Section 6.1. Actions upon Event of Default.
(a) In addition to its rights and remedies provided
hereunder, whenever any Event of Default has occurred and is
continuing, the Agent shall have all rights and remedies of a secured
party upon default under the U.C.C. (whether or not the U.C.C. applies
to the affected Pledged Collateral) or other applicable law, and also
may, without notice except as specified below, sell the Pledged
Collateral or any part thereof in one or more parcels at public or
private sales, at any one of the Agent's offices or elsewhere, for
cash or credit or for future delivery, without assumption of any
credit risk, and upon such other terms as the Agent may deem
commercially reasonable. Each Pledgor agrees that, to the extent
notice of sale shall be required by applicable law, at least ten (10)
days' notice to each 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 Agent shall not be obligated
to make any sale of Pledged Collateral regardless of notice of sale
having been given. The 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. Without limitation of the
above, the Agent may, whenever any Event of Default has occurred and
is continuing, without prior notice to any Pledgor, take all or any of
the following actions:
(i) vote any or all of the Pledged Shares (whether or
not the same shall have been transferred into its name or the
name of its nominee or nominees) for any lawful purpose, give all
consents, waivers and ratifications in respect of the Pledged
Shares, and otherwise act with respect thereto as though it were
the outright owner thereof;
(ii) transfer all or any part of the Pledged Collateral
into the name of the Agent or its nominee, with or without
disclosing that such Pledged Collateral is subject to the lien
hereunder;
(iii) enforce collection of any of the Pledged
Collateral by suit or otherwise, and surrender, release or
exchange all or any part thereof, or compromise or extend or
renew for any period (whether or not longer than the original
period) any obligations of any nature of any party with respect
thereto;
(iv) endorse any checks, drafts or other writings in the
name of any Pledgor to allow collection of the Pledged Collateral
pledged by such Pledgor hereunder;
(v) take control of any products or proceeds of the
Pledged Collateral;
(vi) execute (in the name, place and stead of any
Pledgor) endorsements, assignments, stock powers and other
instruments of conveyance or transfer with respect to all or any
of the Pledged Collateral; and
(vii) generally, do all such other acts and things as
may be considered incidental or conducive to any of the matters
or powers mentioned in the foregoing provisions of this paragraph
(a) and which the Agent may or can do lawfully and to use the
name of any Pledgor for such purposes and in any proceedings
arising therefrom.
(b) If the Agent shall determine to exercise its right to
sell any or all of the Pledged Shares pursuant to this ss.6.1, and if in the
opinion of counsel for the Agent it is necessary, or if in the reasonable
opinion of the Agent it is advisable, to have the Pledged Shares, or that
portion thereof to be sold, registered under the provisions of the Securities
Act of 1933, as amended (the "Securities Act"), the Pledgors agree to cause the
Pledged Share Issuer to execute and deliver, and cause the directors and
officers of the Pledged Share Issuer to execute and deliver, without any cost or
expense to any of the Secured Parties, all such Instruments, and to do or cause
to be done all such other acts and things as may be necessary or, in the
reasonable opinion of the Agent, advisable to register such Pledged Shares under
the provisions of the Securities Act and to cause the registration statement
relating thereto to become effective and to remain effective for a period of
nine (9) months from the date such registration statement became effective, and
to make all amendments and supplements thereto or to the related prospectus or
both that, in the reasonable opinion of the Agent, are necessary or advisable,
all in conformity with the requirements of the Securities Act and the rules and
regulations of the SEC applicable
thereto. The Pledgors agree to cause such Pledged Share Issuer to comply with
the provisions of the securities or "Blue Sky" laws of any jurisdiction which
the Agent shall designate and to cause such to make available to its security
holders, as soon as practicable, an earnings statement (which need not be
audited) which will satisfy the provisions of ss.11(a) of the Securities Act.
(c) Each Pledgor recognizes that the Agent may be unable to
effect a public sale of the Pledged Shares by reason of certain prohibitions
contained in the Securities Act, and other applicable laws, but may be compelled
to resort to one or more private sales thereof to a restricted group of
purchasers. Each Pledgor agrees that any such private sales may be at prices and
other terms less favorable to the seller than if sold at public sales and that
such private sales shall not by reason thereof be deemed not to have been made
in a commercially reasonable manner. The Agent shall be under no obligation to
delay a private sale of any of the Pledged Shares for the period of time
necessary to permit the applicable Pledged Share Issuer to register such Pledged
Shares for public sale under the Securities Act, or other Applicable Laws, even
if such Pledged Share Issuer would agree to do so and even if a registration
statement for the purpose of registering such pledged shares shall have been
filed under the Securities Act
(d) So long as an Event of Default has occurred and is
continuing, each Pledgor shall, upon the request of the Agent, take or cause to
be taken (or, if such Pledgor does not have the legal right to take such action
or cause such action to be taken, such Pledgor will use its best efforts to
cause such action to be taken), in good faith and promptly, and without any cost
or expense to any of the Secured Parties, all such action as may be necessary or
desirable, as soon as reasonably practicable, to sell or to effect the sale of
the Pledged Shares of any Pledged Share Issuer pledged by such Pledgor
hereunder. Such action shall include but shall not be limited to the following:
(i) such Pledgor shall prepare and deliver to the Agent
as soon as practicable, but in any event not later than thirty
(30) days after request by the Agent, a written plan for the sale
or other disposition of such Pledged Shares, which plan shall be
reasonably satisfactory in form and substance to the Majority
Banks;
(ii) such Pledgor shall and shall cause any Pledged
Share Issuer to retain such investment banking firms,
accountants, appraisers and other consultants who are reasonably
acceptable to the Majority Banks to make recommendations with
respect to and to assist in such sale, and such Pledgor shall
cause such investment banking firms, accountants, appraisers and
other consultants to furnish the Agent with all such financial
reports, appraisals, opinions and other documents which the Agent
shall reasonably request; and
(iii) if (and on each occasion that) such Pledgor or any
Pledged Share Issuer shall receive from any Person an offer to
purchase any such Pledged Shares, such Pledgor shall and shall
cause the applicable Pledged Share Issuer to furnish or cause to
be furnished to the Agent a written notice setting forth the full
particulars thereof, including (A) the name and address of such
Person, and (B) the terms of such offer to purchase.
Each purchaser of any of the Pledged Shares, and the agreement entered
into by such purchaser in connection with such purchase and sale, shall
be subject to the prior written agreement, consent or approval of the
Majority Banks. Each Pledgor shall and shall cause each of its
Subsidiaries to deliver forthwith to the Agent in the form received,
except for the addition of any endorsement or assignment necessary to
effect transfer of all rights therein to the Agent, any payment
received by such Pledgor or any of its Subsidiaries on account of any
such purchase and sale of any such Pledged Shares. Until so delivered,
each such payment shall be held in trust for the Agent and shall not be
commingled with any other funds of such Pledgor or any of its
Subsidiaries.
(e) The Agent may buy any part or all of the Pledged
Collateral at any public sale and if any part or all of the Pledged
Collateral is of a type customarily sold in a recognized market, or is
of the type which is the subject of widely distributed price standard
price quotations, the Agent may buy at private sale, and may make
payments thereof by any means.
Section 6.2. Application of Proceeds. All cash proceeds received by
the Agent in respect of any sale of, liquidation of, collection from, or other
realization upon, all or any part of the Pledged Collateral shall be applied by
the Agent in the following order:
(a) first, to the Secured Parties, on account of the payment
of, or the reimbursement of any Secured Party for, all costs and
expenses incurred or sustained by any Secured Party that are required
by the terms of this Agreement, the Credit Agreement or any other Loan
Document to be paid or reimbursed by any Pledgor; and
(b) second, to the Secured Parties, pro rata, on account of
all other Obligations due and payable to such Secured Parties.
Any surplus of such cash proceeds held by the Agent and remaining after payment
in full of all the Obligations shall be paid over to the Pledgor or Pledgors
entitled thereto or to whomsoever else may be lawfully entitled to receive such
surplus. Each Pledgor shall remain liable for any deficiency.
Section 6.3. Indemnity and Expenses. Each Pledgor hereby jointly and
severally agrees to indemnify and hold harmless each Secured Party, and the
shareholders, officers, directors, employees, agents, Subsidiaries and
Affiliates of each Secured Party, from and against any and all claims, losses
and liabilities arising out of or resulting from this Agreement (including the
enforcement thereof), except for any portion of such claims, losses or
liabilities which a court of competent jurisdiction has found, in a final,
nonappealable order, resulted solely by reason of such Secured Party's gross
negligence or willful misconduct. Upon demand, each of the Pledgors will pay to
the Agent the amount of any and all reasonable expenses, including the
reasonable fees and disbursements of its counsel and of any experts, which the
Agent may incur in connection with:
(a) the administration of this Agreement or any Instrument
relating hereto;
(b) the custody, preservation, use or operation of, or the
sale of, collection from, or other realization upon, any of the
Pledged Collateral pledged by such Pledgor hereunder;
(c) the exercise or enforcement against such Company of any
of the rights of the Agent hereunder;
(d) the failure by such Pledgor to perform or observe any of
the provisions hereof; or
(e) the advancing of any funds in connection with actions
taken pursuant to ss.7.3.
Section 6.4. No Waiver; Remedies Cumulative. No delay, act or omission
on the part of the Agent of any of its rights hereunder shall be deemed a waiver
of any rights hereunder unless also contained in a writing signed by the Agent,
nor shall any single or partial exercise of, or any failure to exercise, any
right, power or privilege preclude any other or further or initial exercise
thereof or of any other right, power or privilege. The rights and remedies
provided herein are cumulative, and not exclusive of rights and remedies which
may be granted or provided by applicable law.
Section 6.5. Marshalling. Neither the Agent nor any Secured Party shall
be required to marshal any present or future collateral security (including but
not limited to this Agreement and the Pledged Collateral) for, or other
assurances of payment of, the Obligations or any of them or to resort to such
collateral security or other assurances of payment in any particular order, and
all of the rights of the Agent hereunder and the Agent or any Secured Party in
respect of such collateral security and other assurances of payment shall be
cumulative and in addition to all other rights, however existing or arising. To
the extent that it lawfully may, each Pledgor hereby agrees that it will not
invoke any applicable law relating to the marshalling of collateral which might
cause delay in or impede the enforcement of the Agent's rights under this
Agreement or under any other Instrument creating or evidencing any of the
Obligations or under which any of the Obligations is outstanding or by which any
of the Obligations is secured or payment thereof is otherwise assured, and, to
the extent that it lawfully may, each Pledgor hereby irrevocably waives the
benefits of all such laws.
SECTION 7. MISCELLANEOUS PROVISIONS
Section 7.1. Security Document, etc. For all purposes of the Credit
Agreement, this Agreement is a "Security Document" and a "Loan Document"
executed and delivered pursuant to the Credit Agreement.
Section 7.2. Amendments, etc. No amendment to or waiver of any
provision of this Agreement nor consent to any departure by any Pledgor herefrom
shall in any event be effective unless the same shall be in writing and signed
by the Agent, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which it is given.
Section 7.3. Protection of Collateral. The Agent may from time to
time, at its option, perform any act which any Pledgor agrees hereunder to
perform and which any Pledgor shall fail to perform after being requested in
writing to so perform (it being understood that no such request need be given
during the continuance of any Default or Event of Default), and the Agent may
from time to time take any other action which the Agent reasonably deems
necessary for the maintenance, preservation or protection of any of the Pledged
Collateral or of the security interests therein.
Section 7.4. Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing or by facsimile
transmission and, if to any of the Pledgors, addressed or delivered to it at the
address set forth below the signature of the Borrower hereto, and if to the
Agent, addressed or delivered to it at the address set forth in Section 18 of
the Credit Agreement, or as to any party at such other address as shall be
designated by such party in a written notice to the other parties complying as
to delivery with the terms of this Section. Any such notices and other
communications, if mailed and properly addressed with postage prepaid or
transmitted by facsimile transmission, shall be deemed given when received.
Section 7.5. Subordination of Subrogation Rights. The rights which any
of the Pledgors shall acquire against the Borrower or any other Pledgor in the
nature of subrogation, indemnity or contribution rights, as a consequence of
making any payments to the Agent under this Agreement, or as a consequence of
the sale of any of the Pledged Collateral by the Agent pursuant to this
Agreement, are, in this ss.7.5, collectively called the "Subrogation Rights" In
the event of any bankruptcy or insolvency proceeding involving any Pledgor or
any Property of any Pledgor, if all of the Obligations have not been paid in
full in cash at the time, the Agent is hereby irrevocably authorized by each
Pledgor at any such proceeding:
(a) to enforce all of the Subrogation Rights of such
Pledgor, either in the name of the Agent or in the name of such
Pledgor, by proof of debt, proof of claim, suit or otherwise;
(b) to collect any Property of any of the Pledgors
distributed or applied by way of dividend or payment on account of
such Subrogation Rights, and to apply the same, or the proceeds of any
realization thereof, towards the payment of the Obligations until all
of the Obligations have been paid in full in cash; and
(c) to vote claims arising under or in respect of all such
Subrogation Rights.
Except as and to the extent otherwise expressly contemplated and permitted by
the foregoing provisions of this ss.7.5, so long as any Obligations remain
unpaid, no Pledgor shall take any action of any kind to enforce any of its
Subrogation Rights, and no Pledgor shall receive or accept from any Person or
Persons any payments or other distributions in respect of any of its Subrogation
Rights. Should any payment or distribution on account of any of the Subrogation
Rights be received by any Pledgor, such payment or distribution shall be
delivered by such Pledgor forthwith to the Agent for the benefit of the Secured
Parties in the form received by such Pledgor, except for the addition of any
endorsement or assignment necessary to effect transfer of
all rights therein to the Agent. Until so delivered, each such payment shall be
held by such Pledgor in trust for the benefit of the Secured Parties and shall
not be commingled with any other funds of such Pledgor.
Section 7.6. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Section 7.7. Choice of Law. This Pledge Agreement and the rights and
obligations of the parties hereunder shall be construed and interpreted in
accordance with the laws of The Commonwealth of Massachusetts (excluding the
laws applicable to conflicts or choice of law).
Section 7.8. Consent to Jurisdiction. EACH PLEDGOR BY ITS EXECUTION
HEREOF (A) HEREBY IRREVOCABLY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE
STATE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS AND TO THE NONEXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF
MASSACHUSETTS FOR THE PURPOSE OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING
OUT OF OR BASED UPON THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE SUBJECT
MATTER HEREOF OR THEREOF, AND (B) HEREBY WAIVES TO THE EXTENT NOT PROHIBITED BY
APPLICABLE LAW, AND AGREES NOT TO ASSERT, BY WAY OF MOTION, AS A DEFENSE OR
OTHERWISE, IN ANY SUCH PROCEEDING, ANY CLAIM THAT IT IS NOT SUBJECT PERSONALLY
TO THE JURISDICTION OF THE ABOVE-NAMED COURTS, THAT ITS PROPERTY IS EXEMPT OR
IMMUNE FROM ATTACHMENT OR EXECUTION, THAT ANY SUCH PROCEEDING BROUGHT IN ONE OF
THE ABOVE-NAMED COURTS IS IMPROPER, OR THAT THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR THE SUBJECT MATTER HEREOF OR THEREOF MAY NOT BE ENFORCED IN OR BY
SUCH COURT. EACH PLEDGOR HEREBY CONSENTS TO SERVICE OF PROCESS IN ANY SUCH
PROCEEDING IN ANY MANNER PERMITTED BY CHAPTER 223A OF THE GENERAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS, AND AGREES THAT SERVICE OF PROCESS BY REGISTERED
OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, AT ITS ADDRESS SPECIFIED IN OR
PURSUANT TO ss.7.4 IS REASONABLY CALCULATED TO GIVE ACTUAL NOTICE.
Section 7.9. Counterparts. This Agreement may be executed by the
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same
agreement.
Section 7.10. Waiver Of Jury Trial. EACH PARTY HERETO HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION.
Section 7.11. Compliance with Communications Act. Anything in this
Agreement to the contrary notwithstanding, the Agent shall not take any action
hereunder in violation of the Communications Act, and shall not vote any of the
Pledged Shares, and no sale of the Pledged Collateral or transfer thereof to the
Agent or to the Agent's nominees shall be made without such (if any) approval of
the FCC as may be required by the Communications Act. Neither the Agent nor any
other Person other than the duly licensed Pledgor shall operate or otherwise
exercise any control over the Station licensed to such Pledgor without first
having received such prior approval of the FCC as shall then be required. In the
event any such approval shall be required, each Pledgor absolutely and
unconditionally agrees to execute upon the request of the Agent, and absolutely
and unconditionally agrees to use its best efforts, upon the request of the
Agent, to cause the execution of, all such applications and other instruments as
may be necessary to obtain promptly such approval.
Section 7.12. Collateral Pledge. At any time after an Event of Default
has occurred and is continuing, the Agent may transfer Pledged Collateral into
its name or that of its nominee.
IN WITNESS WHEREOF, the parties hereto have caused this Pledge
Agreement to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.
XXXXXXXXXX COMMUNICATIONS
COMPANY
By /s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President
Address: 000 00(xx) Xxxxxx, XX
Xxxxx 000
Xxxxxxxxxx, X.X. 0000
Telecopy No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
XXXXXXXXXX GROUP, INC.
By /s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
BANK OF AMERICA, N.A., as Agent
By /s/ Xxxxxxxxxxx X. Xxxxxxxx
----------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Managing Director
Address: 000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxxxx
ALLFINCO, INC.
By /s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
ATTACHMENT 1
(to the Pledge Agreement)
Pledged Shares
Outstanding Outstanding
Outstanding Shares/Units Certificate
Pledgor Pledged Share Issuer Shares/Units Pledged Numbers
------- -------------------- ------------ ------------ -----------
Xxxxxxxxxx Group, Inc. Xxxxxxxxxx 20,000 Common ($.05 20,000 Common #2
Communications Co. par value)
Xxxxxxxxxx Communications KATV, LLC 100 Xxxxx 000 Xxxxx #0
Xx.
Xxxxxxxxxx Communications KTUL, LLC 100 Xxxxx 000 Xxxxx #0
Xx.
Xxxxxxxxxx Communications WSET, Incorporated 4,570 Common (no par 4,570 Common #6
Co. value)
Xxxxxxxxxx Communications WCIV, LLC 100 Xxxxx 000 Xxxxx #0
Xx.
Xxxxxxxxxx Communications Xxxxxxxxxx Television 1,000 Common ($1.00 1,000 Common #1
Co. Productions, Inc. par value)
Xxxxxxxxxx Communications Allfinco, Inc. 1,000 Common ($1.00 1,000 Common #1
Co. par value)
Xxxxxxxxxx Communications ACC Licensee Inc. 1,000 Common 1,000 Common #1
Co. ($.01 par value)
Allfinco, Inc. TV Alabama, Inc. 1000 Class A Common 800 Class A Common #1
($.01 par value)
19,000 Class B Common 19,000 Class B Common #1
($.01 par value)
Allfinco, Inc. Harrisburg Television, 1000 Class A Common 800 Class A Common #1
Inc. ($.01 par value)
19,000 Class B Common 19,000 Class B Common #1
($.01 par value)
