EXHIBIT 99.12
EXECUTION COPY
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STOCK AND PARTNERSHIP INTEREST PLEDGE AGREEMENT
between
XXXXX X. XXXXX, as Pledgor,
THE XXXXX X. XXXXX TRUST, as Pledgor,
and
BNY MIDWEST TRUST COMPANY, as Collateral Agent
Dated as of July 19, 2002
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STOCK AND PARTNERSHIP INTEREST PLEDGE AGREEMENT
This STOCK AND PARTNERSHIP INTEREST PLEDGE AGREEMENT (this "Pledge
Agreement"), dated as of July 19, 2002, is entered into between XXXXX X. XXXXX,
an individual and THE XXXXX X. XXXXX TRUST dated March 5, 1998 (as amended)
(collectively, the "Pledgor") and BNY MIDWEST TRUST COMPANY, an Illinois
corporation, not individually but as collateral agent (the "Collateral Agent")
for Bank of America, N.A., a national banking association (the "Bank") and the
purchasers of 9.35% Senior Secured Notes due July 1, 2004 (the "Purchasers") of
American Golf Corporation, a California corporation (the "Company") (the Bank
and the Purchasers hereinafter collectively referred to as the "Creditors").
RECITALS
A. The Company is indebted to the Bank (the "Bank Obligations")
pursuant to a Credit Agreement dated as of July 30, 1996, as amended, restated
or modified from time to time, and any agreements, instruments, certificates or
other documents entered into in connection therewith (the "Credit Agreement").
The Bank agreed to temporarily forbear from exercising its remedies under the
Credit Agreement pursuant to a Forbearance Agreement dated as of March 5, 2002
(collectively with the Credit Agreement, the "Credit Documents").
B. The Company is indebted to the Purchasers (the "Purchaser
Obligations") pursuant to a Note Purchase Agreement dated as of July 30, 1996
(as amended, restated or modified from time to time, the "Purchase Agreement")
and any agreements, instruments, certificates or other documents entered into in
connection therewith (collectively with the Purchase Agreement, the "Purchase
Documents"). The Credit Documents and the Purchase Documents are hereinafter
collectively referred to as the "Debt Documents". The Bank Obligations and the
Purchaser Obligations are hereinafter collectively referred to as the
"Obligations".
C. The Company has requested that the Bank and the Purchasers further
forbear in the exercise of their remedies by entering into a Restructuring
Agreement and Limited Waiver dated as of July 1, 2002, and certain agreements,
instruments, certificates and other documents in connection therewith
(collectively, the "Restructuring Agreement"). Terms defined in the
Restructuring Agreement and not otherwise defined herein have the same meanings
when used herein.
D. The Bank and the Purchasers are willing to enter into the
Restructuring Agreement subject to the terms and conditions thereof.
E. It is a condition precedent to the closing under the Restructuring
Agreement that the Pledgor execute and deliver this Pledge Agreement, and grant
to the Collateral Agent on behalf of the Creditors (each, a Secured Party and
collectively, the "Secured Parties") a continuing security interest in and lien
upon the Collateral (hereinafter defined) to secure the Obligations.
F. The Pledgor shall execute a limited recourse guaranty (the "DGP
Guaranty") of even date herewith secured by the Pledged Securities (as defined
below) under this Pledge Agreement for the equal and ratable benefit of the
Creditors.
G. The Company, the Creditors and the Collateral Agent are entering
into a Collateral Agency and Intercreditor Agreement of even date herewith (the
"AGC Collateral Agency Agreement") which sets forth the rights and duties of the
Collateral Agent with respect to the Collateral for the equal and ratable
benefit of the Creditors.
H. National Golf Properties, Inc., a Maryland corporation ("NGP"), is a
corporation whose common stock, par value $.01 per share (the "NGP Common
Stock"), is listed on the New York Stock Exchange. NGP is the sole general
partner of National Golf Operating Partnership, L.P., a Delaware limited
partnership ("NGOP", and collectively with NGP, the "Issuers"). NGOP has issued
common partnership units (the "NGOP Common Units") that are exchangeable on a
one-for-one basis with the NGP Common Stock pursuant to the terms of the Third
Amended and Restated Agreement of Limited Partnership of NGOP dated July 28,
1999 (the "NGOP Partnership Agreement").
I. None of the Pledged Securities are registered under applicable
securities laws. Concurrently herewith, the Collateral Agent and NGP are
entering into that certain Unit Exchange and Registration Rights Agreement dated
as of even date herewith (the "Registration Rights Agreement") to facilitate,
upon and in the event of a foreclosure by Collateral Agent hereunder, the
exchange of NGOP Common Units into NGP Common Stock and the public sale of the
NGP Common Stock received by the Collateral Agent in such exchange.
J. In the event of a conflict between the terms of this Pledge
Agreement and the terms of the AGC Collateral Agency Agreement, the terms of the
AGC Collateral Agency Agreement shall govern.
NOW, THEREFORE, the parties hereto hereby agree as follows:
AGREEMENT
1. Grant of Security Interest. The Pledgor hereby pledges and grants to
the Collateral Agent for the ratable benefit of the Secured Parties a
first-priority security interest in the property described in Section 2 below
(collectively and severally, the "Collateral") and assigns, transfers and
delivers to the Collateral Agent the Pledged Securities (defined below),
together with the certificates evidencing the same, which certificates have been
duly endorsed in blank or accompanied by stock, partnership interest or other
equity interest powers duly executed in blank, to secure prompt payment and
performance in full when due, whether at stated maturity, by acceleration or
otherwise of all Obligations.
2. Collateral. The Collateral shall consist of the following:
(a) Pledged Securities. The NGP Common Stock and the NGOP Common
Units currently owned by the Pledgor, all such securities being listed on
Exhibit 2 hereto, and all new, substituted and additional documents,
instruments, and general intangibles issued with respect thereto or in exchange
therefor (collectively, the "Pledged Securities"), and the
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certificates representing such Pledged Securities, if any, and all now existing
and hereafter arising rights of the holder of such Pledged Securities,
including, without limitation, all voting rights and rights to and interest in
all cash and noncash dividends and/or distribution of any kind and nature and
all other property now or hereafter distributable on account of or received or
receivable with respect to any of the foregoing.
(b) Proceeds. All proceeds of the foregoing Collateral. For purposes
of this Pledge Agreement, the term "proceeds" includes whatever is receivable or
received when the Collateral or proceeds are sold, collected, exchanged or
otherwise disposed of, whether such disposition is voluntary or involuntary.
3. Sale of Pledged Securities. Upon the request of the Pledgor, in
order to facilitate a sale by the Pledgor of the Pledged Securities, the
Collateral Agent shall deliver to a licensed broker or underwriter specified by
the Pledgor the Pledged Securities upon the settlement of a sale by the Pledgor
of the Pledged Securities or, if prior to the settlement of such sale, upon
receipt of written confirmation that such broker or underwriter shall have
agreed to act as a bailee of the Collateral Agent and at the Collateral Agent's
direction with respect to any sale of the Pledged Securities, provided that such
broker or underwriter shall commit in writing that (i) the net proceeds of such
sale (or such lesser amount as shall be needed to furnish the Alternate Pledge
Collateral (as defined in the AGC Collateral Agency Agreement) shall be directly
paid to the Collateral Agent (which proceeds the Collateral Agent shall hold as
Alternate Pledge Collateral pursuant to the terms of the Xxxxx X. Xxxxx Control
Agreement (as defined in the AGC Collateral Agency Agreement)) and (ii) any
unsold Pledged Securities shall be returned to the Collateral Agent.
Notwithstanding any of the foregoing, (i) any sale by the Pledgor of the Pledged
Securities shall be a per share price of not less than $4.445, and (ii) in the
event that Pledgor shall sell Pledged Securities to any Affiliate of Pledgor,
such sale shall only be made to the extent such sale is made on an arms length
basis on terms that are not materially less favorable than the Pledgor could
obtain in a transaction with an unaffiliated third party.
4. Representations and Warranties. In addition to any representations
and warranties of the Pledgor set forth in the DGP Guaranty, which are
incorporated herein by this reference, the Pledgor hereby represents and
warrants, on the date hereof and at the time of delivery of any of the
Collateral hereunder, that:
(a) Authority. The Pledgor has full power, authority, and legal
right and has obtained all approvals and consents necessary, to execute, deliver
and perform this Pledge Agreement and the transactions contemplated hereby.
(b) Consents. The Pledgor has obtained all consents, approvals and
waivers from third parties (including governmental entities, if any) relating to
the Pledged Securities necessary to execute and deliver this Pledge Agreement
and to perform his obligations hereunder and the transactions contemplated
hereby.
(c) No Default or Lien. Subject to subsection (f) below, such
execution, delivery and performance will not contravene, or constitute a default
under or result in a lien, except pursuant hereto, upon the Pledged Securities
pursuant to any applicable law or regulation, or any contract, agreement,
judgment, other decree, or other instrument binding upon or affecting
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the Pledgor except for any of the foregoing as would not reasonably be expected
to cause a Material Adverse Effect (as defined in the DGP Guaranty).
(d) Enforceability of Pledge Agreement. This Pledge Agreement
constitutes a legal, valid and binding obligation of the Pledgor, enforceable
against the Pledgor in accordance with its terms, and this Pledge Agreement
grants to the Collateral Agent for the ratable benefit of each Secured Party a
valid, first-priority, and upon the delivery of the Collateral to the Collateral
Agent (to the extent such security interests in the Collateral may be perfected
by delivery of the Collateral to the Collateral Agent), perfected and
enforceable Lien on the Collateral.
(e) Ownership of Collateral. The Pledgor is the sole owner of and
has good and marketable title (but subject to securities law compliance in
connection with any sale) to the Collateral (or, in the case of after-acquired
Collateral, at the time the Pledgor acquires rights in the Collateral, will be
the sole owner thereof) and is (or will be in the case of after-acquired
Collateral) the record, legal and beneficial owner of all the Pledged
Securities, and will at all times be the sole beneficial owner of the Pledged
Securities.
(f) Priority. Except for security interests in favor of the Secured
Parties granted in connection herewith, no person has (or, in the case of
after-acquired Collateral, at the time the Pledgor acquires rights therein, will
have) any right, title, claim or interest (by way of security interest or other
Lien or charge) in, against or to the Collateral.
(g) Delivery of Documents, Etc. The Pledgor has delivered to the
Collateral Agent certificates representing each Pledged Share and all
instruments, documents, chattel paper (as said terms are used in the Uniform
Commercial Code) and other items of Collateral in which a security interest is
or may be perfected by possession, together with such additional writings,
including, without limitation, assignments and duly signed undated stock or
partnership powers as the Pledgor must provide to the Collateral Agent to
perform his duties hereunder, and any additional documents with respect thereto
as the Required Creditors (as defined in the AGC Collateral Agency Agreement)
shall reasonably request, such documents to be delivered to the Collateral Agent
no later than the Effective Date.
(h) Pledged Securities. The Pledged Securities listed on Exhibit 1
constitute all the NGP Common Stock and NGOP Common Units owned by the Pledgor
as of the Effective Date. The Pledged Securities consisting of NGP Common Stock
have been duly and validly issued and are fully paid and nonassessable. The
Pledged Securities consisting of NGOP Common Units have been duly and validly
issued. There are no outstanding options or warrants with respect to the Pledged
Securities or other agreements pursuant to which the Pledgor can acquire
additional securities issuable by NGP or NGOP. The Pledged Securities are not
community property under the laws of the State of California.
(i) Litigation. There are no actions, suits, proceedings, claims or
disputes pending, at law, in equity, in arbitration or before any governmental
authority, against the Pledgor or any of the Pledgor's respective properties (or
to the knowledge of the Pledgor, threatened or contemplated by any governmental
authority against the Pledgor or any of the Pledgor's respective properties)
which purport to affect or pertain to this Pledge Agreement or any of the
transactions contemplated hereby. No injunction, writ, temporary restraining
order or
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any order of any nature has been issued by any court or other governmental
authority purporting to enjoin or restrain the execution, delivery and
performance of this Pledge Agreement or directing that the transactions provided
for herein not be consummated as herein provided.
(j) Regulations T, U or X. The Pledge of the Pledged Securities
pursuant to this Pledge Agreement does not violate Regulation T, U or X of the
Federal Reserve Board.
5. Covenants and Agreements of Pledgor. In addition to all covenants
and agreements of the Pledgor set forth in this Pledge Agreement and the DGP
Guaranty, which are incorporated herein by this reference, the Pledgor hereby
agrees:
(a) Preservation of Collateral. To do all acts that may be
reasonably necessary to maintain, preserve and protect the Collateral and to
preserve the Pledgor as sole owner of the Collateral;
(b) Payment of Taxes, Etc. To pay promptly when due all material
taxes, assessments, charges, encumbrances and Liens now or hereafter imposed
upon or affecting any Collateral;
(c) Defense of Litigation. To appear in and defend any action or
proceeding which may materially and adversely affect the Pledgor's title to or
each Secured Party's interest in the Collateral;
(d) Transfer and Other Liens. (i) Not to sell or contract to sell or
otherwise dispose of, or grant any option or warrant with respect to, the
Collateral and (ii) to keep the Collateral free of all levies and security
interests or other Liens or charges except those approved in writing by the
Required Creditors in accordance with the Debt Documents and the Restructure
Documents, in each case, except as otherwise provided in this Pledge Agreement;
(e) Delivery of Collateral. To account fully for and promptly
deliver to the Collateral Agent, in the form received, all documents, chattel
paper, instruments and agreements and share certificates (as defined in the
Uniform Commercial Code) constituting the Collateral hereunder and subject to
the provisions of paragraph (j) below, all proceeds of the Collateral received,
all endorsed in blank, and, in the case of share or partnership interest
certificates, accompanied by such stock or partnership interest powers as
appropriate, and until so delivered, all such documents, instruments, agreements
and proceeds to be held by the Pledgor in trust for the Collateral Agent,
separate from all other property of the Pledgor and shall be identified as the
property of the Collateral Agent on behalf of the Secured Parties;
(f) Further Assurances. To procure, execute and deliver from time to
time any endorsements, notifications, registrations, assignments, financing
statements, and other writings deemed reasonably necessary by the Required
Creditors to perfect, maintain and protect the Secured Parties' security
interest in the Collateral and the priority thereof; and to take such other
actions as the Required Creditors may reasonably request or as is otherwise
reasonably necessary to protect the value of the Collateral and of the Secured
Parties' security interest in the Collateral;
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(g) Payment of Costs and Expenses. To reimburse the Collateral Agent
upon 30 days of written demand for any reasonable costs and expenses, including,
without limitation, reasonable attorneys' fees (including the allocated cost of
inside counsel), the Collateral Agent may incur while exercising any right,
power or remedy provided by this Pledge Agreement or by law, all of which costs
and expenses are included in the Obligations secured hereby. The Pledgor
covenants and agrees to pay the reasonable fees and expenses of counsel to the
Collateral Agent, the Bank and the Purchasers in connection with the
negotiation, preparation, development and review of this Pledge Agreement;
(h) Payments on Collateral; Voting. To account fully for and
promptly deliver to the Collateral Agent, in the form received, any dividend or
any other distribution on account of the Pledged Securities whether in
securities or property by way of stock-split, spin-off, split-up,
reclassification, combination of shares or the like, or in case of any
reorganization, consolidation or merger. Subject to the terms of the AGC
Collateral Agency Agreement and the Restructure Documents, the Collateral Agent
shall be entitled to retain the cash proceeds received from any disposition of
the Pledged Securities and to retain any dividends or any other distribution
lawfully paid by any Issuer on account of the Pledged Securities and shall have
the exclusive right to vote the Pledged Securities and to execute consents with
respect thereto. Any and all stock dividends or instruments and other property
(other than cash) received, receivable or otherwise distributed in exchange for,
any Pledged Securities shall be held in trust for the benefit of and pending
delivery to the Collateral Agent, be segregated from the other property of the
Pledgor, and be forthwith delivered to the Collateral Agent as pledged
Collateral in the same form as received (with any necessary endorsement);
(i) Notices of Changes. To give the Collateral Agent 30 days prior
written notice of any change in the Pledgor's chief place of business,
residence, legal name, etc.;
(j) Location of Records. To keep the records concerning the
Collateral at the address set forth below the Pledgor's signature hereof and not
to remove such records from such locations without 30 days prior written notice
to the Collateral Agent;
(k) Authorized Action by Collateral Agent. The Pledgor hereby agrees
that from time to time, without presentment, notice or demand, and without
affecting or impairing in any way the rights of any Secured Party with respect
to the Collateral, the obligations of the Pledgor hereunder or the Obligations,
the Collateral Agent shall (at the direction of the Required Creditors or any
Directing Creditor (as defined in the AGC Collateral Agency Agreement), as
applicable), but shall incur no liability to the Pledgor or any third party for
failure to, take any action which the Pledgor is obligated by this Pledge
Agreement to do. Any expenses incurred by the Collateral Agent in taking such
action shall be payable by the Pledgor. Subject to Section 14(g) and pursuant to
Section 14(f) of the AGC Collateral Agency Agreement, upon the earlier to occur
of an Alternate Major Default (as defined in the AGC Collateral Agency
Agreement) or October 15, 2002, the Pledgor hereby irrevocably appoints the
Collateral Agent as his attorney-in-fact to exercise such rights and powers,
including without limitation: (i) to collect by legal proceedings or otherwise
and endorse, receive and acknowledge receipt for all dividends, interest,
payments, proceeds, and other sums and property now or hereafter payable on or
on account of the Collateral; (ii) to vote or consent with respect to the
Pledged Securities in accordance with Section 7(d) below; (iii) to enter any
extension, reorganization, deposit, merger,
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consolidation or other agreement pertaining to, or deposit, surrender, accept,
hold or apply other property in exchange for the Collateral and (iv) to make any
compromise or settlement, to pay or discharge taxes, liens, security interests
or other encumbrances and take any action it deems advisable, with respect to
the Collateral. To permit the Collateral Agent to exercise such voting and
consensual rights, to collect, endorse and receive such dividends, interest,
payments, proceeds and other sums and property, the Pledgor shall, if necessary,
upon written request of the Collateral Agent (at the direction of the Required
Creditors or any Directing Creditor, as applicable), from time to time, deliver
(or cause to be executed and delivered) to the Collateral Agent all such
proxies, dividend payment orders and other instruments as the Collateral Agent
(at the direction of the Required Creditors or any Directing Creditor, as
applicable) may reasonably require; and
(l) Direction by the Required Creditors or Directing Creditor. The
Pledgor acknowledges and agrees that the Collateral Agent shall not be required
to take any action or make any decision hereunder unless it has received written
direction (i) prior to the earlier to occur of an Alternate Major Default or
October 15, 2002, from the Required Creditors and (ii) upon the earlier to occur
of an Alternate Major Default or October 15, 2002, from any Directing Creditor,
with respect to such action or decision, and the Collateral Agent shall not be
responsible for the timeliness by the Required Creditors or Directing Creditors,
as applicable, delivering any such direction (or their failure to deliver such
direction).
6. Limited Recourse. NOTWITHSTANDING ANY OTHER PROVISION OF THIS PLEDGE
AGREEMENT TO THE CONTRARY, THE OBLIGATIONS OF THE PLEDGOR HEREUNDER ARE LIMITED
TO, AND THE RIGHTS OF THE COLLATERAL AGENT HEREUNDER SHALL BE RECOURSE SOLELY
TO, THE COLLATERAL.
7. Remedies. Subject to Section 14(g) and pursuant to Section 14(f) of
the AGC Collateral Agency Agreement, upon the earlier to occur of an Alternate
Major Default or October 15, 2002, the Collateral Agent shall upon written
direction of any Directing Creditors and upon at least 10 days' written notice
to the Pledgor (which the Pledgor agrees is reasonable notice) and in addition
to all rights and remedies available to any Secured Party under any other
agreement, do any one or more of the following:
(a) General Enforcement. Foreclose or otherwise enforce the Secured
Parties' security interest in any manner permitted by law, or provided for in
this Pledge Agreement;
(b) Sale Etc. Sell or otherwise dispose of any Collateral at one or
more public or private sales at the Collateral Agent's place of business or any
other place or places, including, without limitation, any brokers' board or
securities exchange, for cash or credit or other property, for immediate or
future delivery, and at such price and on such terms and in such manner as the
Directing Creditors may determine; provided, however, that if the NGP Common
Stock continues to be listed on the New York Stock Exchange or another major
United States securities exchange or designated as a national market system
security by the National Association of Securities Dealers, Inc., and provided
that there is not continuing a suspension in trading of the NGP Common Stock for
more than one business day, then Collateral Agent shall effect any foreclosure
or sale of the Pledged Securities by exercising its rights under the
Registration Rights Agreement (i) with respect to the Pledged Securities
consisting of NGOP Common Units, to
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exchange same into shares of NGP Common Stock and (ii) with respect to the
Pledged Securities consisting of NGP Common Stock (whether as originally so
granted or as so exchanged), to sell the shares into the public markets;
provided, further, that the requirement in the foregoing proviso shall only
apply if (1) NGP shall have filed a Registration Statement on Form S-3 (the
"Shelf Registration Statement") pursuant to the Registration Rights Agreement
covering the total amount of Pledged Securities hereunder, (2) such Shelf
Registration Statement has been declared effective on or prior to the date of
the intended foreclosure sale for which 10 days' written notice was provided by
the Collateral Agent to the Pledgor, (3) notwithstanding anything in the
Registration Rights Agreement to the contrary, there shall be no events
preventing the sale of such Pledged Securities pursuant to the Shelf
Registration Statement, including, without limitation, (i) any request by the
Securities and Exchange Commission (the "SEC") or any state securities authority
for post-effective amendments and supplements to the Shelf Registration
Statement that has become effective, (ii) the issuance by the SEC or any state
securities authority of any stop order suspending the effectiveness of the Shelf
Registration Statement or the initiation of any proceedings for that purpose,
(iii) the representations and warranties of the Company contained in any
underwriting agreement, securities sales agreement or other similar agreement,
if any, relating to the sale of the Pledged Securities cease to be true and
correct in all material respects, (iv) the receipt by the Company of any
notification with respect to the suspension of the qualification of the Pledged
Securities for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose and (v) the Secured Parties are not in possession of
any material non-public information and (4) such Shelf Registration Statement
shall remain effective until all the Pledged Securities hereunder have been
sold. For the avoidance of doubt, nothing in this Section 7(b) shall be
construed to limit the rights of the Collateral Agent to immediately exchange
any of the Pledged Securities consisting of NGOP Common Units into shares of NGP
Common Stock upon any foreclosure or sale (whether public or private) of the
Pledged Securities.
(c) Costs of Remedies. Recover from the Pledgor all reasonable costs
and expenses, including, without limitation, reasonable attorneys' fees
(including the allocated costs of inside counsel), incurred or paid by any
Secured Party in exercising any right, power or remedy provided by this Pledge
Agreement or by law; or
(d) Vote of Pledged Securities. Vote or consent, and in connection
therewith the Pledgor grants to the Collateral Agent a proxy to vote or to
consent, with respect to the Pledged Securities. Notwithstanding the foregoing,
the Collateral Agent hereby agrees to vote the Pledged Securities in favor of
the following transactions: (i) the transactions contemplated by the Merger
Agreement and (ii) any purchase by a third party investor of all or a
substantial portion of the outstanding common stock of NGP so long as such
purchase contemplates the subsequent consummation of the AGC Acquisition, the
GEI Acquisition and Transferred Entity Acquisition (each as defined in the
Merger Agreement).
(e) Manner of Sale of Collateral.
(i) Restrict the prospective bidders or purchasers of the
Pledged Securities to persons or entities who (x) will represent and
agree that they are purchasing for their own account, for
investment, and not with a view to the distribution or sale of any
of the Pledged Securities; and (y) satisfy the offeree and
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purchaser requirements for a valid private placement transaction
under Section 4(2) of the Securities Act of 1933, as amended (the
"Act") or any other method of private placement permitted under the
Act, and the rules and regulations of the Securities and Exchange
Commission applicable thereto, or under any similar statute, rule or
regulation. The Pledgor agrees that disposition of the Pledged
Securities pursuant to any private sale made as provided above may
be at prices and on other terms less favorable than if the Pledged
Securities were sold at public sale, and that the Collateral Agent
has no obligation to delay the sale of any Pledged Securities for
public sale under the Act. The Pledgor agrees that a private sale or
sales made under the foregoing circumstances shall be deemed to have
been made in a commercially reasonable manner and the Pledgor hereby
waives, to the full extent permitted by applicable law, any claims
against the Collateral Agent or any Secured Party arising by reason
of the fact that the price at which the Collateral may have been
sold at a private sale was less than the price that might have been
obtained at a public sale or was less than the aggregate amount of
the Obligations; and
(ii) The Pledgor further agrees to do or to use his reasonable
efforts to cause to be done all such other acts and things as may be
reasonably necessary to make any sales of any portion or all of the
Pledged Securities pursuant to clause (i) of this Section 7(e),
including sales under the Act, valid and binding and in compliance
with any and all applicable laws (including, without limitation, the
Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Securities and Exchange Commission applicable
thereto), regulations, orders, writs, injunctions, decrees or awards
of any and all courts, arbitrators or governmental
instrumentalities, domestic or foreign, having jurisdiction over any
such sale or sales, all at the Pledgor's expense. The Pledgor
further agrees that a breach of any of the covenants contained in
this Section 7 will cause irreparable injury to the Secured Parties,
that the Collateral Agent and the Secured Parties have no adequate
remedy at law in respect of such breach and, as a consequence,
agrees that each and every covenant contained in this Section 7
shall be specifically enforceable against the Pledgor, and the
Pledgor hereby waives and agrees not to assert any defenses against
any action for specific performance of such covenants.
(f) Delivery to and Rights of Purchaser. Upon any sale or other
disposition pursuant to this Pledge Agreement, the Collateral Agent shall have
the right to deliver, assign and transfer to the purchaser thereof the
Collateral or portion thereof so sold or disposed of. Any Secured Party may be
the purchaser of any or all of the Collateral so sold at a public sale and, to
the extent permitted by law, at a private sale. Each purchaser at any such sale
or other disposition (including a Secured Party) shall hold the Collateral free
from any claim or right of whatever kind, including any equity or right of
redemption of the Pledgor, and the Pledgor specifically waives (to the extent
permitted by law) all rights of redemption, stay or appraisal which he has or
may have under any rule of law or statute now existing or hereafter adopted. The
Collateral Agent shall not be required to marshal any Collateral with respect
thereto in any particular order, and the Pledgor hereby waives any and all
rights thereof; and
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(g) Reliance on Experts. In exercising any remedies hereunder
relating to the sale of the Collateral, the Collateral Agent may utilize and
rely on the services and advice of one or more broker-dealers selected by the
Collateral Agent and shall be fully protected in so doing.
(h) No Exchange Until Sale. The Collateral Agent shall not effect
any exchange of the Pledged Securities consisting of NGOP Common Units into
shares of NGP Common Stock except in connection with the sale or foreclosure of
the Pledged Securities.
8. Collection of Collateral Payments.
(a) The Pledgor shall, at his sole cost and expense, take all
reasonably necessary action to obtain payment, when due and payable, of all sums
due or to become due with respect to any Collateral ("Collateral Payments" or a
"Collateral Payment"), including, without limitation, the taking of such action
with respect thereto as the Collateral Agent or the Required Creditors may
reasonably request, or, in the absence of such request, as the Pledgor may
reasonably deem advisable; provided, however, subject to Section 14(g) and
pursuant to Section 14(f) of the AGC Collateral Agency Agreement, upon the
earlier to occur of an Alternate Major Default or October 15, 2002, or if
otherwise prohibited by the Debt Documents or the Restructure Documents, the
Pledgor shall not, without the prior written consent of the Directing Creditors
(which consent shall not be unreasonably withheld), grant or agree to any
rebate, refund, compromise or extension with respect to any Collateral Payment
or accept any prepayment on account thereof. Subject to Section 14(g) and
pursuant to Section 14(f) of the AGC Collateral Agency Agreement, upon the
request of the Collateral Agent at the direction of the Directing Creditors
following the earlier to occur of an Alternate Major Default or October 15,
2002, the Pledgor will notify and direct any party who is or might become
obligated to make any Collateral Payment, to make payment thereof to the
Collateral Agent (or to the Pledgor in care of the Collateral Agent) at such
address as the Collateral Agent may designate. The Pledgor will reimburse the
Collateral Agent promptly upon demand for all reasonable out-of-pocket costs and
expenses, including reasonable attorneys' fees and litigation expenses, incurred
by the Collateral Agent in seeking to collect any Collateral Payment.
(b) Subject to Section 14(g) and pursuant to Section 14(f) of the
AGC Collateral Agency Agreement, upon the earlier to occur of an Alternate Major
Default or October 15, 2002 and upon the request of the Collateral Agent or the
Directing Creditors, the Pledgor will, forthwith upon receipt, transmit and
deliver to the Collateral Agent, in the form received, all cash, checks, drafts
and other instruments for the payment of money (properly endorsed where required
so that such items may be collected by the Collateral Agent) which may be
received by the Pledgor at any time as payment on account of any Collateral
Payment and if such request shall be made, until delivery to the Collateral
Agent, such items will be held in trust for the Collateral Agent and will not be
commingled by the Pledgor with any of his other funds or property. Thereafter,
the Collateral Agent is hereby authorized and empowered to endorse the name of
the Pledgor on any check, draft or other instrument for the payment of money
received by the Collateral Agent on account of any Collateral Payment if the
Collateral Agent reasonably believes such endorsement is necessary or desirable
for purposes of collection.
(c) The Pledgor hereby indemnifies and saves harmless the Collateral
Agent, the Secured Parties and their respective agents, officers and employees
from and against all
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liabilities and reasonable expenses on account of any adverse claim asserted
against the Collateral Agent or the Secured Parties (except for the Collateral
Agent's or the Secured Parties' own gross negligence or willful misconduct)
relating to any moneys received by the Collateral Agent or the Secured Parties
on account of any Collateral Payment, and such obligation of the Pledgor shall
continue in effect after and notwithstanding the discharge of the Obligations
and the release of the security interest granted in Section 1 above. This
indemnity shall survive the termination of this Pledge Agreement and the
resignation or removal of the Collateral Agent.
9. Cumulative Rights; Indemnity, etc. The rights, powers and remedies
of the Collateral Agent and the Secured Parties under this Pledge Agreement
shall be in addition to all rights, powers and remedies given to the Secured
Parties by virtue of any statute or rule of law, the AGC Collateral Agency
Agreement, the Debt Documents, the Restructure Documents, the DGP Guaranty or
any other agreement, all of which rights, powers and remedies shall be
cumulative and may be exercised successively or concurrently without impairing
any Secured Party's or the Collateral Agent's security interest in the
Collateral. The Pledgor shall indemnify and save the Collateral Agent and the
Secured Parties harmless from and against any and all liabilities, losses and
damages which they may incur in the lawful and proper exercise or performance of
any of their rights or powers as authorized herein (except for such Person's own
gross negligence or willful misconduct). This indemnity shall survive the
termination of this Pledge Agreement and the resignation or removal of the
Collateral Agent.
10. Waiver. Any waiver, forbearance or failure or delay by any Secured
Party in exercising any right, power or remedy shall not preclude the further
exercise thereof, and every right, power or remedy of a Secured Party shall
continue in full force and effect until such right, power or remedy is
specifically waived in a writing. The Pledgor waives any right to require the
Secured Parties to proceed against any person or to exhaust any Collateral or to
pursue any remedy in any Secured Party's power.
11. No Responsibility for Loss; No Duty of Collateral Agent and Secured
Parties. The Collateral Agent and the Secured Parties are hereby released from
all responsibility for any depreciation in or loss of value of the Pledged
Securities (except for their own gross negligence or willful misconduct). The
rights and remedies of the Collateral Agent and the Secured Parties hereunder
are solely to protect the Secured Parties' interest in the Collateral and shall
not impose any duty upon them to exercise any such powers.
12. Binding on Successors and Assigns. All rights and obligations of
each party hereto shall inure to the benefit of their respective successors and
assigns.
13. Amendment. This Pledge Agreement may not be amended or modified
except by a writing signed by the Pledgor and the Collateral Agent.
14. Notices. Unless otherwise expressly provided herein, all notices
and other communications provided for hereunder shall be in writing (including
by facsimile transmission) and mailed, faxed or delivered or to the address and
facsimile number specified for notices in the AGC Collateral Agency Agreement;
or, in the case of the Pledgor or the Collateral Agent, to such other address as
shall be designated by such party in a written notice to the other parties, and
in the case of any other party, to such other address as shall be designated by
such party in a
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written notice to the Pledgor and the Collateral Agent. All such notices and
other communications shall be deemed to be given or made upon the earlier to
occur of (i) actual receipt by the intended recipient and (ii) (A) if delivered
by hand or by courier, when signed for by the intended recipient; (B) if
delivered by mail, upon receipt by the recipient; and (C) if delivered by
facsimile, when sent and receipt has been confirmed in writing.
If to BNY Midwest Trust Company:
0 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Structured Finance Services
with a copy to:
Xxxxxxx and Xxxxxx
000 X. Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxx, Xx., Esq.
If to Xxxxx X. Xxxxx:
0000 00xx Xxxxxx
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx & Xxxxxxx LLP
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxx 00000-0000
Facsimile (000) 000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
J. Xxxxx Xxxxxxxx, Esq.
The Collateral Agent shall be entitled to rely on the authority of any
person purporting to be a person authorized by the Pledgor to give such notice
and reasonably believed by the Collateral Agent to be genuine and correct, and
the Collateral Agent shall not have any liability to Pledgor or other person on
account of any action taken or not taken by the Collateral Agent and the Secured
Parties in reliance upon such notice.
15. Counterparts. This Pledge Agreement may be executed by one or more
of the parties to this Pledge Agreement in any number of separate counterparts,
each of which, when so executed, shall be deemed an original, and all of said
counterparts taken together shall be deemed to constitute but one and the same
instrument. Delivery by telecopier of an executed counterpart of a signature
page to this Pledge Agreement shall be effective as delivery of an originally
executed counterpart of this Pledge Agreement.
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16. Severability. The illegality or unenforceability of any provision
of this Pledge Agreement or any instrument or agreement required hereunder shall
not in any way affect or impair the legality or enforceability of the remaining
provisions of this Pledge Agreement or any instrument or agreement required
hereunder.
17. Governing Law and Jurisdiction.
(a) THIS PLEDGE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA WITHOUT REGARD TO CONFLICTS
OF LAW PRINCIPLES.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS PLEDGE
AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA OR OF THE
UNITED STATES FOR THE CENTRAL DISTRICT OF CALIFORNIA, AND BY EXECUTION AND
DELIVERY OF THIS PLEDGE AGREEMENT, THE PARTIES HERETO, FOR THEMSELVES AND IN
RESPECT OF THEIR PROPERTY, SUBMIT TO THE JURISDICTION OF THOSE COURTS. THE
PARTIES HERETO IRREVOCABLY WAIVE ANY OBJECTION, INCLUDING ANY OBJECTION TO THE
LAYING OF VENUE BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH THEY MAY NOW
OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS PLEDGE AGREEMENT OR ANY DOCUMENT RELATED HERETO.
THE PARTIES HERETO WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, AND SERVICE MAY BE MADE BY ANY OTHER MEANS PERMITTED BY CALIFORNIA LAW.
(c) THE PARTIES HERETO WAIVE THEIR RIGHTS TO A TRIAL BY JURY OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATING TO THIS PLEDGE
AGREEMENT. IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
ANY OF THE PARTIES HERETO AGAINST THE OTHER, WHETHER WITH RESPECT TO CONTRACT
CLAIMS, TORT CLAIMS, OR OTHERWISE, THE PLEDGOR AGREES THAT ANY SUCH CLAIM OR
CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING
THE FOREGOING, THE PARTIES HERETO FURTHER AGREE THAT THEIR RESPECTIVE RIGHTS TO
A TRIAL BY JURY ARE WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR ENFORCEABILITY OF THIS PLEDGE AGREEMENT. THIS WAIVER SHALL APPLY
TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
PLEDGE AGREEMENT.
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18. Entire Agreement. Together with the Restructure Documents, the
Debt Documents and the AGC Collateral Agency Agreement, this Pledge Agreement
embodies the entire agreement of the parties hereto with respect to the subject
matter hereof and supersedes all prior or contemporaneous agreement and
understanding of such parties, verbal or written.
19. Conflicting Provisions. In the event of a conflict between the
terms of this Pledge Agreement and the terms of the AGC Collateral Agency
Agreement in respect of the rights and obligations of the Secured Parties, the
terms of the AGC Collateral Agency Agreement shall govern.
20. Reinstatement. This Pledge Agreement and the security interest
created hereunder shall automatically be reinstated if and to the extent that
for any reason any payment by or on behalf of the Pledgor in respect of the
Obligations is rescinded or must otherwise be restored by any holder of the
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and the Pledgor shall indemnify the Secured Parties
on demand for all reasonable costs and expenses (including, without limitation,
fees of counsel) incurred by the Secured Parties in connection with such
rescission or restoration.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Pledge
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
XXXXX X. XXXXX,
Pledgor
By: /s/ Xxxxx X. Xxxxx
--------------------------------------
Name: Xxxxx X. Xxxxx
Title:
THE XXXXX X. XXXXX TRUST,
Pledgor
By: /s/ Xxxxx X. Xxxxx
--------------------------------------
Name: Xxxxx X. Xxxxx
Title: Trustee
BNY MIDWEST TRUST COMPANY,
as Collateral Agent for the Secured Parties
By: /s/ Xxxxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Assistant Treasurer
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