EXHIBIT 10.5
PLEDGE AGREEMENT SUPPLEMENT
PLEDGE AGREEMENT SUPPLEMENT dated as of May 15, 2002 between Nortel
Networks Limited (the "COMPANY") and JPMORGAN CHASE BANK, as Collateral Agent.
WHEREAS, Nortel Networks Limited, the Subsidiary Guarantors party
thereto and JPMorgan Chase Bank, as Collateral Agent, are parties to a Foreign
Pledge Agreement dated as of April 4, 2002 (as heretofore amended and/or
supplemented, the "PLEDGE AGREEMENT");
WHEREAS, Nortel Networks Limited is a party to the Pledge Agreement as
a Lien Grantor and Guarantor thereunder; and
WHEREAS, terms defined in the Pledge Agreement and not otherwise
defined herein have, as used herein, the respective meanings provided for
therein;
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Pledge of Equity Interest. (a) In order to secure the Secured
Obligations, the Company grants to the Collateral Agent for the benefit of the
Secured Parties, effective on the date hereof, a continuing security interest in
all Equity Interests in the Subsidiary identified in Schedule I hereto held
directly by the Company and all of its rights and privileges with respect
thereto, and all income and profits thereon, all interest, dividends and other
payments and distributions with respect thereto, whether now owned or existing
or hereafter acquired or arising and regardless of where located (the "NEW
COLLATERAL"). The security interests granted by the Company pursuant hereto
shall terminate in accordance with Section 18 of the Pledge Agreement.
(b) The foregoing Pledges are granted as security only and shall not
subject the Collateral Agent or any other Secured Party to, or transfer or in
any way affect or modify, any obligation or liability of the Company with
respect to any of the New Collateral or any transaction in connection therewith.
2. Delivery of Collateral. On the date of execution hereof and on
each Drawdown Date the Company has complied with the provisions of either
Section
6 or Section 9(a) (as applicable) of the Pledge Agreement with respect to
Pledged Equity Interests, in each case if and to the extent included in the New
Collateral at such time.
3. Representations and Warranties. (a) The Company represents and
warrants, on the date of execution hereof and on each Drawdown Date, that on
such date it is a corporation duly organized and validly existing under the laws
of its jurisdiction of organization, of which the Company has on or prior to
such time given prior written notice to the Collateral Agent.
(b) The Company represents and warrants, on the date of execution
hereof that execution and delivery of this Pledge Agreement Supplement by the
Company and the performance by it of its obligations under the Pledge Agreement
as supplemented hereby (i) are within its corporate or other powers, have been
duly authorized by all necessary corporate or other action, (ii) except as
disclosed in writing to the Collateral Agent or its counsel on or prior to such
date by any NNL Company or its counsel, require no action by or in respect of,
or filing with, any governmental body, agency or official other than filings for
perfection of Pledges on the New Collateral and (iii) do not contravene, or
constitute a default under, any provision of applicable law or regulation or of
its organizational documents, or of any agreement, judgment, injunction, order,
decree or other instrument binding upon it except, with respect to (ii) and
(iii) above, any such action, filing or contravention which would not have a
material adverse affect on the ability of the Company to perform its obligations
under this Pledge Agreement Supplement or the Pledge Agreement.
(c) The Company represents and warrants on the date of execution
hereof that on such date the Pledge Agreement as supplemented hereby constitutes
a valid and binding agreement of the Company, enforceable in accordance with its
terms, except as limited by and subject to applicable bankruptcy, insolvency,
fraudulent conveyance or other similar laws affecting creditors' rights
generally and general principles of equity.
(d) Each of the representations and warranties set forth in Sections 4
and 6 of the Pledge Agreement is true as applied to the Company and the New
Collateral on the date specified therein. For purposes of the foregoing
sentence, references in said Sections to a "Lien Grantor" shall be deemed to
refer to the Company, references to "Schedules" to the Pledge Agreement shall be
deemed to refer to the corresponding Schedules to this Pledge Agreement
Supplement, references to "Collateral" shall be deemed to refer to the New
Collateral, and the Collateral Period shall be deemed to have commenced on the
date of execution hereof.
2
4. Governing Law. This Pledge Agreement Supplement shall be construed
in accordance with and governed by the laws of the State of New York.
3
IN WITNESS WHEREOF, the parties hereto have caused this Pledge
Agreement Supplement to be duly executed by their respective authorized officers
as of the day and year first above written.
NORTEL NETWORKS LIMITED
By: /s/ Xxxxxxxxx X. Xxxxxxxxx
---------------------------------
Name: Xxxxxxxxx X. Xxxxxxxxx
Title: Treasurer
By: /s/ Xxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Secretary
4
JPMORGAN CHASE BANK,
as Collateral Agent
By: /s/ Xxxxxx XxXxxxxx
----------------------------------
Name: Xxxxxx XxXxxxxx
Title: Vice-President
5
SCHEDULE 1
PLEDGED EQUITY INTERESTS IN MATERIAL SUBSIDIARIES
OWNED BY THE COMPANY
(AS OF THE DATE HEREOF)
JURISDICTION NUMBER OF
OF OWNER OF PERCENTAGE SHARES OR
ISSUER ORGANIZATION EQUITY INTERESTS OWNED UNITS
------ ------------ ----------------- ---------- ---------
Nortel Networks Mauritius Mauritius Nortel Networks Limited 0.00% 1
Ltd
S-1-1
