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Exhibit 10.5*
PLEDGE AGREEMENT dated as of June 30, 1999, among
XXXXXXX ELECTRONICS, INC., a Delaware corporation (the "Parent
Borrower"), each Subsidiary of the Parent Borrower listed on
Schedule I hereto (each such Subsidiary individually a
"Subsidiary Pledgor" and collectively, the "Subsidiary
Pledgors"; the Parent Borrower and the Subsidiary Pledgors are
referred to collectively herein as the "Pledgors") and THE
CHASE MANHATTAN BANK, a New York banking corporation
("Chase"), as administrative agent (in such capacity, the
"Administrative Agent") for the Secured Parties (as defined in
the Credit Agreement referred to below).
Reference is made to (a) the Credit Agreement dated as of June 28, 1999
(as amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among the Parent Borrower, the lenders from time to time party
thereto (the "Lenders"), Chase, as Administrative Agent for the Lenders,
Swingline Lender and as issuing bank (in such capacity, the "Issuing Bank"), and
Xxxxxx Xxxxxxx Senior Funding, Inc., as Syndication Agent, (b) the Parent
Guarantee Agreement dated as of June 30, 1999 (as amended, supplemented or
otherwise modified from time to time, the "Parent Guarantee Agreement"), between
the Parent Borrower and the Administrative Agent and (c) the Subsidiary
Guarantee Agreement dated as of June 30, 1999 (as amended, supplemented or
otherwise modified from time to time, the "Subsidiary Guarantee Agreement"; and,
collectively with the Parent Guarantee Agreement, the "Guarantee Agreements"),
among the Subsidiary Pledgors and the Administrative Agent.
The Lenders have agreed to make Loans to the Borrowers and the Issuing
Bank has agreed to issue Letters of Credit for the account of the Borrowers,
pursuant to, and upon the terms and subject to the conditions specified in, the
Credit Agreement. Each of the Subsidiary Guarantors (as defined in the Security
Agreement) have agreed to guarantee, among other things, all the obligations of
each Borrower under the Credit Agreement. The obligations of the Lenders to make
Loans and of the Issuing Bank to issue Letters of Credit are conditioned upon,
among other things, the execution and delivery by the Pledgors of a Pledge
Agreement in the form hereof to secure (a) the due and punctual payment by each
Borrower of (i) the principal of and premium, if any, and interest (including
interest accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding) on the Loans made to such Borrower, when and as
due, whether at maturity, by acceleration, upon one or more dates set for
prepayment or otherwise, (ii) each payment required to be made by such Borrower
under the Credit Agreement in respect of any Letter of Credit, when and as due,
including payments in respect of reimbursement of disbursements, interest
thereon and obligations to provide cash collateral and (iii) all other monetary
obligations, including fees, costs, expenses and indemnities, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), of such Borrower to the Secured Parties under the
Credit Agreement and the other Loan Documents, (b) the due and punctual
performance of all covenants, agreements, obligations and liabilities of each
Borrower under or pursuant to the Credit Agreement and the other Loan Documents,
(c) the due and punctual payment and performance of all the covenants,
agreements, obligations and liabilities of each other Loan Party under or
pursuant to this Agreement and the other Loan Documents and (d) the due and
punctual payment and performance of all obligations of each Borrower and any
Loan Party under each Hedging Agreement entered into with any counterparty that
was a Lender (or an Affiliate of a Lender)
* Confidential Information in this Exhibit 10.5 has been omitted and filed
separately with the Securities and Exchange Commission.
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at the time such Hedging Agreement was entered into (all the monetary and other
obligations referred to in the preceding clauses (a) through (d) being referred
to collectively as the "Obligations"). Capitalized terms used herein and not
defined herein shall have meanings assigned to such terms in the Credit
Agreement.
Accordingly, the Pledgors and the Administrative Agent, on behalf of
itself and each Secured Party (and each of their respective successors or
assigns), hereby agree as follows:
SECTION 1. Pledge. As security for the payment and performance, as the
case may be, in full of the Obligations, each Pledgor hereby transfers, grants,
bargains, sells, conveys, hypothecates, pledges, sets over and delivers unto the
Administrative Agent, its successors and assigns, and hereby grants to the
Administrative Agent, its successors and assigns, for the ratable benefit of the
Secured Parties, a security interest in all of the Pledgor's right, title and
interest in, to and under (a)(i) the Equity Interests owned by it and listed on
Schedule II hereto and any shares of capital stock of the Parent Borrower or any
Subsidiary obtained in the future by such Pledgor and the certificates
representing all such shares and (ii) any shares of capital stock of Xxxxxxx
Electronics Japan K.K. obtained in the future by the Parent Borrower and the
certificates representing all such shares (collectively, the "Pledged Stock");
provided that the Pledged Stock shall not include (i) more than 65% of the
issued and outstanding shares of voting stock of any Foreign Subsidiary or (ii)
to the extent that applicable law requires that a Subsidiary of such Pledgor
issue directors' qualifying shares, such qualifying shares; (b)(i) the debt
securities listed opposite the name of such Pledgor on Schedule II hereto, (ii)
any debt securities in the future issued to such Pledgor and (iii) the
promissory notes and any other instruments evidencing such debt securities (the
"Pledged Debt Securities"); (c) all other property that may be delivered to and
held by the Administrative Agent pursuant to the terms hereof; (d) subject to
Section 5, all payments of principal or interest, dividends, cash, instruments
and other property from time to time received, receivable or otherwise
distributed, in respect of, in exchange for or upon the conversion of the
securities referred to in clauses (a) and (b) above; (e) subject to Section 5,
all rights and privileges of the Pledgor with respect to the Equity Interests,
securities and other property referred to in clauses (a), (b), (c) and (d)
above; and (f) all proceeds of any of the foregoing (the items referred to in
clauses (a) through (f) above being collectively referred to as the
"Collateral"). Upon delivery to the Administrative Agent, (a) any certificates
with respect to Equity Interests, notes or other securities now or hereafter
included in the Collateral (the "Pledged Securities") shall be accompanied by
stock powers duly executed in blank or other instruments of transfer
satisfactory to the Administrative Agent and by such other instruments and
documents as the Administrative Agent may reasonably request and (b) all other
property comprising part of the Collateral shall be accompanied by proper
instruments of assignment duly executed by the applicable Pledgor and such other
instruments or documents as the Administrative Agent may reasonably request.
Each delivery of Pledged Securities shall be accompanied by a schedule
describing the securities theretofore and then being pledged hereunder, which
schedule shall be attached hereto as Schedule II and made a part hereof. Each
schedule so delivered shall supersede any prior schedules so delivered.
TO HAVE AND TO HOLD the Collateral, together with all right, title,
interest, powers, privileges and preferences pertaining or incidental thereto,
unto the Administrative Agent, its successors and assigns, for the ratable
benefit of the Secured Parties, forever; subject, however, to the terms,
covenants and conditions hereinafter set forth.
SECTION 2. Delivery of the Collateral. (a) Each Pledgor agrees promptly to
deliver or cause to be delivered to the Administrative Agent any and all Pledged
Securities, and any and all certificates or other instruments or documents
representing the Collateral.
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(b) Each Pledgor will cause any Indebtedness for borrowed money owed to
the Pledgor by any Person to be evidenced by a duly executed promissory note
that is pledged and delivered to the Administrative Agent pursuant to the terms
thereof.
SECTION 3. Representations, Warranties and Covenants. Each Pledgor hereby
represents, warrants and covenants, as to itself and the Collateral pledged by
it hereunder, to and with the Administrative Agent that:
(a) the Pledged Stock represents that percentage as set forth on
Schedule II of the issued and outstanding shares of each class of the
capital stock of the issuer with respect thereto;
(b) except for the security interest granted hereunder and other
than as permitted under the terms of the Credit Agreement, the Pledgor (i)
is and will at all times continue to be the direct owner, beneficially and
of record, of the Pledged Securities indicated on Schedule II, (ii) holds
the same free and clear of all Liens, (iii) will make no assignment,
pledge, hypothecation or transfer of, or create or permit to exist any
security interest in or other Lien on, the Collateral, other than pursuant
hereto, and (iv) subject to Section 5, will cause any and all Collateral,
whether for value paid by the Pledgor or otherwise, to be forthwith
deposited with the Administrative Agent and pledged or assigned hereunder;
(c) the Pledgor (i) has the power and authority to pledge the
Collateral in the manner hereby done or contemplated and (ii) will defend
its title or interest thereto or therein against any and all Liens (other
than the Lien created by this Agreement), however arising, of all Persons
whomsoever;
(d) no consent of any other Person (including stockholders or
creditors of any Pledgor) and no consent or approval of any Governmental
Authority or any securities exchange which has not been obtained was or is
necessary to the validity of the pledge effected hereby;
(e) by virtue of the execution and delivery by the Pledgors of this
Agreement, when the Pledged Securities, certificates or other documents
representing or evidencing the Collateral are delivered to the
Administrative Agent in accordance with this Agreement, the Administrative
Agent will obtain a valid and perfected first lien upon and security
interest in such Pledged Securities as security for the payment and
performance of the Obligations;
(f) the pledge effected hereby is effective to vest in the
Administrative Agent, on behalf of the Secured Parties, the rights of the
Administrative Agent in the Collateral as set forth herein;
(g) all of the Pledged Stock has been duly authorized and validly
issued and is fully paid and nonassessable;
(h) all information set forth herein relating to the Pledged Stock
is accurate and complete in all material respects as of the date hereof;
and
(i) the pledge of the Pledged Stock pursuant to this Agreement does
not violate Regulation T, U or X of the Federal Reserve Board or any
successor thereto as of the date hereof.
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SECTION 4. Registration in Nominee Name; Denominations. The Administrative
Agent, on behalf of the Secured Parties, shall have the right (in its sole and
absolute discretion) to hold the Pledged Securities in its own name as pledgee,
the name of its nominee (as pledgee or as sub-agent) or the name of the
Pledgors, endorsed or assigned in blank or in favor of the Administrative Agent.
Each Pledgor will promptly give to the Administrative Agent copies of any
notices or other communications received by it with respect to Pledged
Securities registered in the name of such Pledgor. The Administrative Agent
shall at all times have the right to exchange the certificates representing
Pledged Securities for certificates of smaller or larger denominations for any
purpose consistent with this Agreement.
SECTION 5. Voting Rights; Dividends and Interest, etc. (a) Unless and
until an Event of Default shall have occurred and be continuing:
(i) Each Pledgor shall be entitled to exercise any and all voting
and/or other consensual rights and powers inuring to an owner of Pledged
Securities or any part thereof for any purpose consistent with the terms
of this Agreement, the Credit Agreement and the other Loan Documents;
provided, however, that such Pledgor will not be entitled to exercise any
such right if the result thereof could materially and adversely affect the
rights inuring to a holder of the Pledged Securities or the rights and
remedies of any of the Secured Parties under this Agreement or the Credit
Agreement or any other Loan Document or the ability of the Secured Parties
to exercise the same.
(ii) The Administrative Agent shall execute and deliver to each
Pledgor, or cause to be executed and delivered to each Pledgor, all such
proxies, powers of attorney and other instruments as such Pledgor may
reasonably request for the purpose of enabling such Pledgor to exercise
the voting and/or consensual rights and powers it is entitled to exercise
pursuant to subparagraph (i) above and to receive the cash dividends it is
entitled to receive pursuant to subparagraph (iii) below.
(iii) Each Pledgor shall be entitled to receive and retain any and
all cash dividends, interest and principal paid on the Pledged Securities
to the extent and only to the extent that such cash dividends, interest
and principal are permitted by, and otherwise paid in accordance with, the
terms and conditions of the Credit Agreement, the other Loan Documents and
applicable laws. All noncash dividends, interest and principal, and all
dividends, interest and principal paid or payable in cash or otherwise in
connection with a partial or total liquidation or dissolution, return of
capital, capital surplus or paid-in surplus, and all other distributions
(other than distributions referred to in the preceding sentence) made on
or in respect of the Pledged Securities, whether paid or payable in cash
or otherwise, whether resulting from a subdivision, combination or
reclassification of the outstanding capital stock of the issuer of any
Pledged Securities or received in exchange for Pledged Securities or any
part thereof, or in redemption thereof, or as a result of any merger,
consolidation, acquisition or other exchange of assets to which such
issuer may be a party or otherwise, shall be and become part of the
Collateral, and, if received by any Pledgor, shall not be commingled by
such Pledgor with any of its other funds or property but shall be held
separate and apart therefrom, shall be held in trust for the benefit of
the Administrative Agent and shall be forthwith delivered to the
Administrative Agent in the same form as so received (with any necessary
endorsement).
(b) Upon the occurrence and during the continuance of an Event of Default,
all rights of any Pledgor to dividends, interest or principal that such Pledgor
is authorized to receive pursuant to paragraph (a)(iii) above shall cease, and
all such rights shall thereupon become
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vested in the Administrative Agent, which shall have the sole and exclusive
right and authority to receive and retain such dividends, interest or principal.
All dividends, interest or principal received by the Pledgor contrary to the
provisions of this Section 5 shall be held in trust for the benefit of the
Administrative Agent, shall be segregated from other property or funds of such
Pledgor and shall be forthwith delivered to the Administrative Agent upon demand
in the same form as so received (with any necessary endorsement). Any and all
money and other property paid over to or received by the Administrative Agent
pursuant to the provisions of this paragraph (b) shall be retained by the
Administrative Agent in an account to be established by the Administrative Agent
upon receipt of such money or other property and shall be applied in accordance
with the provisions of Section 7. After all Events of Default have been cured or
waived, the Administrative Agent shall, within five Business Days after all such
Events of Default have been cured or waived, repay to each Pledgor all cash
dividends, interest or principal (without interest), that such Pledgor would
otherwise be permitted to retain pursuant to the terms of paragraph (a)(iii)
above and which remain in such account.
(c) Upon the occurrence and during the continuance of an Event of Default,
all rights of any Pledgor to exercise the voting and consensual rights and
powers it is entitled to exercise pursuant to paragraph (a)(i) of this Section
5, and the obligations of the Administrative Agent under paragraph (a)(ii) of
this Section 5, shall cease, and all such rights shall thereupon become vested
in the Administrative Agent, which shall have the sole and exclusive right and
authority to exercise such voting and consensual rights and powers, provided
that unless otherwise directed by the Required Lenders, the Administrative Agent
shall have the right from time to time following and during the continuance of
an Event of Default to permit the Pledgors to exercise such rights. After all
Events of Default have been cured or waived, such Pledgor will have the right to
exercise the voting and consensual rights and powers that it would otherwise be
entitled to exercise pursuant to the terms of paragraph (a)(i) above.
SECTION 6. Remedies upon Default. Upon the occurrence and during the
continuance of an Event of Default, subject to applicable regulatory and legal
requirements, the Administrative Agent may sell the Collateral, or any part
thereof, at public or private sale or at any broker's board or on any securities
exchange, for cash, upon credit or for future delivery as the Administrative
Agent shall deem appropriate. The Administrative Agent shall be authorized at
any such sale (if it deems it advisable to do so) to restrict the prospective
bidders or purchasers to Persons who will represent and agree that they are
purchasing the Collateral for their own account for investment and not with a
view to the distribution or sale thereof, and upon consummation of any such sale
the Administrative Agent shall have the right to assign, transfer and deliver to
the purchaser or purchasers thereof the Collateral so sold. Each such purchaser
at any such sale shall hold the property sold absolutely free from any claim or
right on the part of any Pledgor, and, to the extent permitted by applicable
law, the Pledgors hereby waive all rights of redemption, stay, valuation and
appraisal any Pledgor now has or may at any time in the future have under any
rule of law or statute now existing or hereafter enacted.
The Administrative Agent shall give a Pledgor 10 days' prior written
notice (which each Pledgor agrees is reasonable notice within the meaning of
Section 9-504(3) of the Uniform Commercial Code as in effect in the State of New
York or its equivalent in other jurisdictions) of the Administrative Agent's
intention to make any sale of such Pledgor's Collateral. Such notice, in the
case of a public sale, shall state the time and place for such sale and, in the
case of a sale at a broker's board or on a securities exchange, shall state the
board or exchange at which such sale is to be made and the day on which the
Collateral, or portion thereof, will first be offered for sale at such board or
exchange. Any such public sale shall be
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held at such time or times within ordinary business hours and at such place or
places as the Administrative Agent may fix and state in the notice of such sale.
At any such sale, the Collateral, or portion thereof, to be sold may be sold in
one lot as an entirety or in separate parcels, as the Administrative Agent may
(in its sole and absolute discretion) determine. The Administrative Agent shall
not be obligated to make any sale of any Collateral if it shall determine not to
do so, regardless of the fact that notice of sale of such Collateral shall have
been given. The Administrative Agent may, without notice or publication, adjourn
any public or private sale or cause the same to be adjourned from time to time
by announcement at the time and place fixed for sale, and such sale may, without
further notice, be made at the time and place to which the same was so
adjourned. In case any sale of all or any part of the Collateral is made on
credit or for future delivery, the Collateral so sold may be retained by the
Administrative Agent until the sale price is paid in full by the purchaser or
purchasers thereof, but the Administrative Agent shall not incur any liability
in case any such purchaser or purchasers shall fail to take up and pay for the
Collateral so sold and, in case of any such failure, such Collateral may be sold
again upon like notice. At any public (or, to the extent permitted by applicable
law, private) sale made pursuant to this Section 6, any Secured Party may bid
for or purchase, free from any right of redemption, stay or appraisal on the
part of any Pledgor (all said rights being also hereby waived and released), the
Collateral or any part thereof offered for sale and may make payment on account
thereof by using any claim then due and payable to it from such Pledgor as a
credit against the purchase price, and it may, upon compliance with the terms of
sale, hold, retain and dispose of such property without further accountability
to such Pledgor therefor. For purposes hereof, (a) a written agreement to
purchase the Collateral or any portion thereof shall be treated as a sale
thereof, (b) the Administrative Agent shall be free to carry out such sale
pursuant to such agreement and (c) such Pledgor shall not be entitled to the
return of the Collateral or any portion thereof subject thereto, notwithstanding
the fact that after the Administrative Agent shall have entered into such an
agreement all Events of Default shall have been remedied and the Obligations
paid in full. As an alternative to exercising the power of sale herein conferred
upon it, the Administrative Agent may proceed by a suit or suits at law or in
equity to foreclose upon the Collateral and to sell the Collateral or any
portion thereof pursuant to a judgment or decree of a court or courts having
competent jurisdiction or pursuant to a proceeding by a court-appointed
receiver. Any sale pursuant to the provisions of this Section 6 shall be deemed
to conform to the commercially reasonable standards as provided in Section
9-504(3) of the Uniform Commercial Code as in effect in the State of New York or
its equivalent in other jurisdictions.
SECTION 7. Application of Proceeds of Sale. The proceeds of any sale of
Collateral pursuant to Section 6, as well as any Collateral consisting of cash,
shall be applied by the Administrative Agent as follows:
FIRST, to the payment of all costs and expenses incurred by the
Administrative Agent in connection with such sale or otherwise in
connection with this Agreement, any other Loan Document or any of the
Obligations, including all court costs and the reasonable fees and
expenses of its agents and legal counsel, the repayment of all advances
made by the Administrative Agent hereunder or under any other Loan
Document on behalf of any Pledgor and any other costs or expenses incurred
in connection with the exercise of any right or remedy hereunder or under
any other Loan Document;
SECOND, to the payment in full of the Obligations (the amounts so
applied to be distributed among the Secured Parties pro rata in accordance
with the amounts of the Obligations owed to them on the date of any such
distribution); and
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THIRD, to the Pledgors, their successors or assigns, or as a court
of competent jurisdiction may otherwise direct.
The Administrative Agent shall have absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Agreement. Upon any sale of the Collateral by the Administrative Agent
(including pursuant to a power of sale granted by statute or under a judicial
proceeding), the receipt of the purchase money by the Administrative Agent or of
the officer making the sale shall be a sufficient discharge to the purchaser or
purchasers of the Collateral so sold and such purchaser or purchasers shall not
be obligated to see to the application of any part of the purchase money paid
over to the Administrative Agent or such officer or be answerable in any way for
the misapplication thereof.
SECTION 8. Reimbursement of Administrative Agent. (a) Each Pledgor agrees
to pay upon demand to the Administrative Agent the amount of any and all
reasonable expenses, including the reasonable fees, other charges and
disbursements of its counsel and of any experts or agents, that the
Administrative Agent may incur in connection with (i) the administration of this
Agreement, (ii) the custody or preservation of, or the sale of, collection from,
or other realization upon, any of the Collateral, (iii) the exercise or
enforcement of any of the rights of the Administrative Agent hereunder or (iv)
the failure by such Pledgor to perform or observe any of the provisions hereof.
(b) Without limitation of its indemnification obligations under the other
Loan Documents, each Pledgor agrees to indemnify the Administrative Agent and
the Indemnitees (as defined in Section 9.03(b) of the Credit Agreement) against,
and hold each Indemnitee harmless from, any and all losses, claims, damages,
liabilities and related expenses, including reasonable counsel fees, other
charges and disbursements, incurred by or asserted against any Indenmitee
arising out of, in any way connected with, or as a result of (i) the execution
or delivery of this Agreement or any other Loan Document or any agreement or
instrument contemplated hereby or thereby, the performance by the parties hereto
of their respective obligations thereunder or the consummation of the
Transactions and the other transactions contemplated thereby or (ii) any claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto, provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or wilful misconduct of such Indemnitee.
(c) Any amounts payable as provided hereunder shall be additional
Obligations secured hereby and by the other Security Documents. The provisions
of this Section 8 shall remain operative and in full force and effect regardless
of the termination of this Agreement, the consummation of the transactions
contemplated hereby, the repayment of any of the Obligations, the invalidity or
unenforceability of any term or provision of this Agreement or any other Loan
Document or any investigation made by or on behalf of the Administrative Agent
or any other Secured Party. All amounts due under this Section 8 shall be
payable on written demand therefor and shall bear interest at the rate specified
in Section 2.13(c)(ii) of the Credit Agreement.
SECTION 9. Administrative Agent Appointed Attorney-in-Fact. Each Pledgor
hereby appoints the Administrative Agent the attorney-in-fact of such Pledgor
for the purpose of carrying out the provisions of this Agreement and taking any
action and executing any instrument that the Administrative Agent may deem
necessary or advisable to accomplish the purposes hereof, which appointment is
irrevocable and coupled with an interest. Without
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limiting the generality of the foregoing, the Administrative Agent shall have
the right, upon the occurrence and during the continuance of an Event of
Default, with full power of substitution either in the Administrative Agent's
name or in the name of such Pledgor, to ask for, demand, xxx for, collect,
receive and give acquittance for any and all moneys due or to become due under
and by virtue of any Collateral, to endorse checks, drafts, orders and other
instruments for the payment of money payable to the Pledgor representing any
interest or dividend or other distribution payable in respect of the Collateral
or any part thereof or on account thereof and to give full discharge for the
same, to settle, compromise, prosecute or defend any action, claim or proceeding
with respect thereto, and to sell, assign, endorse, pledge, transfer and to make
any agreement respecting, or otherwise deal with, the same; provided, however,
that nothing herein contained shall be construed as requiring or obligating the
Administrative Agent to make any commitment or to make any inquiry as to the
nature or sufficiency of any payment received by the Administrative Agent, or to
present or file any claim or notice, or to take any action with respect to the
Collateral or any part thereof or the moneys due or to become due in respect
thereof or any property covered thereby. The Administrative Agent and the other
Secured Parties shall be accountable only for amounts actually received as a
result of the exercise of the powers granted to them herein, and neither they
nor their officers, directors, employees or agents shall be responsible to any
Pledgor for any act or failure to act hereunder, except for their own gross
negligence or wilful misconduct.
SECTION 10. Waivers: Amendment. (a) No failure or delay of the
Administrative Agent in exercising any power or right hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the Administrative Agent
hereunder and of the other Secured Parties under the other Loan Documents are
cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provisions of this Agreement or consent to any
departure by any Pledgor therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) below, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. No notice or demand on any Pledgor in any case shall entitle such Pledgor
to any other or further notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived, amended
or modified except pursuant to a written agreement entered into between the
Administrative Agent and the Pledgor or Pledgors with respect to which such
waiver, amendment or modification is to apply, with the prior written consent of
the Required Lenders (and such other consent as may be required by Section 9.02
of the Credit Agreement).
SECTION 11. Securities Act, etc. In view of the position of the Pledgors
in relation to the Pledged Securities, or because of other current or future
circumstances, a question may arise under the Securities Act of 1933, as now or
hereafter in effect, or any similar statute hereafter enacted analogous in
purpose or effect (such Act and any such similar statute as from time to time in
effect being called the "Federal Securities Laws") with respect to any
disposition of the Pledged Securities permitted hereunder. Each Pledgor
understands that compliance with the Federal Securities Laws might very strictly
limit the course of conduct of the Administrative Agent if the Administrative
Agent were to attempt to dispose of all or any part of the Pledged Securities,
and might also limit the extent to which or the manner in which any subsequent
transferee of any Pledged Securities could dispose of the same. Similarly, there
may be other legal restrictions or limitations affecting the Administrative
Agent in any attempt to dispose of all or part of the Pledged Securities under
applicable "blue
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sky" or other state securities laws or similar laws analogous in purpose or
effect. Each Pledgor recognizes that in light of such restrictions and
limitations the Administrative Agent may, with respect to any sale of the
Pledged Securities, limit the purchasers to those who will agree, among other
things, to acquire such Pledged Securities for their own account, for
investment, and not with a view to the distribution or resale thereof. Each
Pledgor acknowledges and agrees that in light of such restrictions and
limitations, the Administrative Agent, in its sole and absolute discretion, (a)
may proceed to make such a sale whether or not a registration statement for the
purpose of registering such Pledged Securities or part thereof shall have been
filed under the Federal Securities Laws and (b) may approach and negotiate with
a single potential purchaser to effect such sale. Each Pledgor acknowledges and
agrees that any such sale might result in prices and other terms less favorable
to the seller than if such sale were a public sale without such restrictions. In
the event of any such sale, the Administrative Agent shall incur no
responsibility or liability for selling all or any part of the Pledged
Securities at a price that the Administrative Agent, in its sole and absolute
discretion, may in good xxxxx xxxx reasonable under the circumstances,
notwithstanding the possibility that a substantially higher price might have
been realized if the sale were deferred until after registration as aforesaid or
if more than a single purchaser were approached. The provisions of this Section
11 will apply notwithstanding the existence of a public or private market upon
which the quotations or sales prices may exceed substantially the price at which
the Administrative Agent sells.
SECTION 12. Registration, etc. Each Pledgor agrees that, upon the
occurrence and during the continuance of an Event of Default hereunder, if for
any reason the Administrative Agent desires to sell any of the Pledged
Securities of the Parent Borrower at a public sale, it will, at any time and
from time to time, upon the written request of the Administrative Agent, use its
best efforts to take or to cause the issuer of such Pledged Securities to take
such action and prepare, distribute and/or file such documents, as are required
or advisable in the reasonable opinion of counsel for the Administrative Agent
to permit the public sale of such Pledged Securities. Each Pledgor further
agrees to indemnify, defend and hold harmless the Administrative Agent, each
other Secured Party, any underwriter and their respective officers, directors,
affiliates and controlling Persons from and against all loss, liability,
expenses, costs of counsel (including, without limitation, reasonable fees and
expenses to the Administrative Agent of legal counsel), and claims (including
the costs of investigation) that they may incur insofar as such loss, liability,
expense or claim arises out of or is based upon any alleged untrue statement of
a material fact contained in any prospectus (or any amendment or supplement
thereto) or in any notification or offering circular, or arises out of or is
based upon any alleged omission to state a material fact required to be stated
therein or necessary to make the statements in any thereof not misleading,
except insofar as the same may have been caused by any untrue statement or
omission based upon information furnished in writing to such Pledgor or the
issuer of such Pledged Securities by the Administrative Agent or any other
Secured Party expressly for use therein. Each Pledgor further agrees, upon such
written request referred to above, to use its best efforts to qualify, file or
register, or cause the issuer of such Pledged Securities to qualify, file or
register, any of the Pledged Securities under the "blue sky" or other securities
laws of such states as may be requested by the Administrative Agent and keep
effective, or cause to be kept effective, all such qualifications, filings or
registrations. Each Pledgor will bear all costs and expenses of carrying out its
obligations under this Section 12. Each Pledgor acknowledges that there is no
adequate remedy at law for failure by it to comply with the provisions of this
Section 12 and that such failure would not be adequately compensable in damages,
and therefore agrees that its agreements contained in this Section 12 may be
specifically enforced.
SECTION 13. Security Interest Absolute. All rights of the Administrative
Agent hereunder, the grant of a security interest in the Collateral and all
obligations of each Pledgor
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hereunder, shall be absolute and unconditional irrespective of (a) any lack of
validity or enforceability of the Credit Agreement, any other Loan Document, any
agreement with respect to any of the Obligations or any other agreement or
instrument relating to any of the foregoing, (b) any change in the time, manner
or place of payment of, or in any other term of, all or any of the Obligations,
or any other amendment or waiver of or any consent to any departure from the
Credit Agreement, any other Loan Document or any other agreement or instrument
relating to any of the foregoing, (c) any exchange, release or nonperfection of
any other collateral, or any release or amendment or waiver of or consent to or
departure from any guaranty, for all or any of the Obligations or (d) any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, any Pledgor in respect of the Obligations or in respect of this
Agreement (other than the indefeasible payment in full of all the Obligations).
SECTION 14. Termination or Release. (a) This Agreement and the security
interests granted hereby shall terminate when all the Obligations (other than
any right to indemnification of any Secured Party with respect to any matter in
respect of which no claim has been asserted and is outstanding) have been
indefeasibly paid in full and the Lenders have no further commitment to lend
under the Credit Agreement, the LC Exposure has been reduced to zero and the
Issuing Bank has no further obligation to issue Letters of Credit under the
Credit Agreement.
(b) Upon any sale or other transfer by any Pledgor of any Collateral that
is permitted under the Credit Agreement to any Person that is not a Pledgor, or,
upon the effectiveness of any written consent to the release of the security
interest granted hereby in any Collateral pursuant to Section 9.02(b) of the
Credit Agreement, the security interest in such Collateral shall be
automatically released.
(c) In connection with any termination or release pursuant to paragraph
(a) or (b), the Administrative Agent shall execute and deliver to any Pledgor,
at such Pledgor's expense, all documents that such Pledgor shall reasonably
request to evidence such termination or release. Any execution and delivery of
documents pursuant to this Section 14 shall be without recourse to or warranty
by the Administrative Agent.
SECTION 15. Notices. All communications and notices hereunder shall be in
writing and given as provided in Section 9.01 of the Credit Agreement. All
communications and notices hereunder to any Subsidiary Pledgor shall be given to
it in care of the Parent Borrower.
SECTION 16. Further Assurances. Each Pledgor agrees to do such further
acts and things, and to execute and deliver such additional conveyances,
assignments, agreements and instruments, as the Administrative Agent may at any
time reasonably request in connection with the administration and enforcement of
this Agreement or with respect to the Collateral or any part thereof or in order
better to assure and confirm unto the Administrative Agent its rights and
remedies hereunder.
SECTION 17. Binding Effect; Several Agreement; Assignments. Whenever in
this Agreement any of the parties hereto is referred to, such reference shall be
deemed to include the successors and assigns of such party; and all covenants,
promises and agreements by or on behalf of any Pledgor that are contained in
this Agreement shall bind and inure to the benefit of its successors and
assigns. This Agreement shall become effective as to any Pledgor when a
counterpart hereof executed on behalf of such Pledgor shall have been delivered
to the Administrative Agent and a counterpart hereof shall have been executed on
behalf of the Administrative Agent, and thereafter shall be binding upon such
Pledgor and the
11
11
Administrative Agent and their respective successors and assigns, and shall
inure to the benefit of such Pledgor, the Administrative Agent and the other
Secured Parties, and their respective successors and assigns, except that no
Pledgor shall have the right to assign its rights hereunder or any interest
herein or in the Collateral (and any such attempted assignment shall be void),
except as expressly contemplated by this Agreement or the other Loan Documents.
If all of the capital stock of a Pledgor is sold, transferred or otherwise
disposed of to a Person that is not an Affiliate of the Parent Borrower pursuant
to a transaction permitted by Section 6.05 of the Credit Agreement, such Pledgor
shall be released from its obligations under this Agreement without further
action. This Agreement shall be construed as a separate agreement with respect
to each Pledgor and may be amended, modified, supplemented, waived or released
with respect to any Pledgor without the approval of any other Pledgor and
without affecting the obligations of any other Pledgor hereunder.
SECTION 18. Survival of Agreement; Severability. (a) All covenants,
agreements, representations and warranties made by each Pledgor herein and in
the certificates or other instruments prepared or delivered in connection with
or pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Administrative Agent and the other Secured Parties
and shall survive the making by the Lenders of the Loans and the issuance of the
Letters of Credit by the Issuing Bank, regardless of any investigation made by
the Secured Parties or on their behalf, and shall continue in full force and
effect as long as all the Obligations have not been indefeasibly paid in full or
the LC Exposure does not equal zero and as long as the Commitments have not been
terminated.
(b) In the event any one or more of the provisions contained in this
Agreement should be held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby (it being understood
that the invalidity of a particular provision in a particular jurisdiction shall
not in and of itself affect the validity of such provision in any other
jurisdiction). The parties shall endeavor in good-faith negotiations to replace
the invalid, illegal or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.
SECTION 19. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 20. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute a single contract, and shall become effective
as provided in Section 17. Delivery of an executed counterpart of a signature
page to this Agreement by facsimile transmission shall be as effective as
delivery of a manually executed counterpart of this Agreement.
SECTION 21. Rules of Interpretation. The rules of interpretation specified
in Section 1.03 of the Credit Agreement shall be applicable to this Agreement.
Section headings used herein are for convenience of reference only, are not part
of this Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting this Agreement.
SECTION 22. Jurisdiction; Consent to Service of Process. (a) Each Pledgor
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or Federal court of
the United States of America sitting in New York City, and any appellate court
from any thereof; in any action or proceeding arising out of or relating to this
Agreement or the other Loan Documents, or for
12
12
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that, to the extent permitted by
applicable law, all claims in respect of any such action or proceeding may be
heard and determined in such New York State or, to the extent permitted by law,
in such Federal court. Each of the parties hereto agrees that a final judgment
in any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law. Nothing in this Agreement shall affect any right that the Administrative
Agent or any other Secured Party may otherwise have to bring any action or
proceeding relating to this Agreement or the other Loan Documents against any
Pledgor or its properties in the courts of any jurisdiction.
(b) Each Pledgor hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or the other Loan Documents in any
New York State or Federal court. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
(c) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 15. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 23. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTAT1VE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY 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 BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 24. Additional Pledgors. Pursuant to Section 5.12 of the Credit
Agreement, each Subsidiary of the Parent Borrower that was not in existence or
not a Subsidiary on the date of the Credit Agreement is or may be required (if
and to the extent set forth in the Credit Agreement) to enter in this Agreement
as a Subsidiary Pledgor upon becoming a Subsidiary if such Subsidiary owns or
possesses property of a type that would be considered Collateral hereunder. Upon
execution and delivery by the Administrative Agent and a Subsidiary of an
instrument in the form of Annex 1, such Subsidiary shall become a Subsidiary
Pledgor hereunder with the same force and effect as if originally named as a
Subsidiary Pledgor herein. The execution and delivery of such instrument shall
not require the consent of any Pledgor hereunder. The rights and obligations of
each Pledgor hereunder shall remain in full force and effect notwithstanding the
addition of any new Subsidiary Pledgor as a party to this Agreement.
SECTION 25. Execution of Financing Statements. Pursuant to Section 9-402
of the Uniform Commercial Code as in effect in the State of New York or its
equivalent in other jurisdictions, each Pledgor authorizes the Administrative
Agent to file financing statements with respect to the Collateral owned by it
without the signature of such Pledgor in such form and in such filing offices as
the Administrative Agent reasonably determines appropriate to
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13
perfect the security interests of the Administrative Agent under this Agreement.
A carbon, photographic or other reproduction of this Agreement shall be
sufficient as a financing statement for filing in any jurisdiction.
14
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first above written.
XXXXXXX ELECTRONICS, INC.,
by /s/ Reg X. Xxxxxxx
--------------------------------------
Name:
Title: CHM/CEO
THE SUBSIDIARY PLEDGORS LISTED
ON SCHEDULE I HERETO,
by /s/ Reg X. Xxxxxxx
--------------------------------------
Name:
Title: Authorized Officer
THE CHASE MANHATTAN BANK, as
Administrative Agent,
by______________________________________
Name:
Title:
15
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first above written.
XXXXXXX ELECTRONICS, INC.,
by
--------------------------------------
Name:
Title:
THE SUBSIDIARY PLEDGORS LISTED
ON SCHEDULE I HERETO,
by
--------------------------------------
Name:
Title: Authorized Officer
THE CHASE MANHATTAN BANK, as
Administrative Agent,
by /s/ X. Xxxxx
--------------------------------------
Name: Xxxxxxx Xxxxx
Title: Vice President
16
Schedule I to the
Pledge Agreement
Subsidiary Pledgors
--------------------------------------------------------------------------------
Guarantor Address
--------- -------
--------------------------------------------------------------------------------
Knowles Intermediate Holding, Inc. 0000 Xxxxxxxxx Xxxxx
Xxxxxx, XX 00000
--------------------------------------------------------------------------------
Emkay Innovative Products, Inc. 0000 Xxxxxxxxx Xxxxx
Xxxxxx, XX 00000
--------------------------------------------------------------------------------
Xxxxxxx Manufacturing Ltd. 0000 Xxxxxxxxx Xxxxx
Xxxxxx, XX 00000
--------------------------------------------------------------------------------
Synchro-Start Products, Inc. 0000 Xxxx Xxxxxx Xxxxxx
Xxxxx, XX 00000
--------------------------------------------------------------------------------
17
Schedule II to the
Pledge Agreement
Items marked with an asterisk are those being pledged pursuant to this Pledge
Agreement.
Equity Interests
----------------------------------------------------------------------------------------
Percentage
Number of Registered Number of of Equity
Issuer Certificate Owner(4) Shares Interests
------ ----------- -------- ------ ---------
----------------------------------------------------------------------------------------
Gennum Corporation(5) -- Xxxxxxx 90 --
Electronics, Inc.
----------------------------------------------------------------------------------------
*Xxxxxxx Intermediate 1 Xxxxxxx 1,000 100%
Holding, Inc. Electronics, Inc.
----------------------------------------------------------------------------------------
*Xxxxxxx Electronics 1 Xxxxxxx 1 100%
B.V.I. Ltd. Electronics, Inc.
----------------------------------------------------------------------------------------
*Xxxxxxx Electronics A-001 Xxxxxxx 100 100%
Japan, K.K. ("KEJ") B-001 Electronics, Inc. 100
----------------------------------------------------------------------------------------
* Xxxxxxx Electronics 1 Xxxxxxx 9 100%
(Malaysia) Sdn. Bhd. 3 Electronics, Inc. 1
("KEM")
----------------------------------------------------------------------------------------
Xxxxxxx Electronics -- Xxxxxxx -- 100%
Suzhou Co. Ltd. ("KES")(6) Electronics, Inc.
----------------------------------------------------------------------------------------
*Xxxxxxx Electronics No. 1 Xxxxxxx 52,993 99.9984%
Taiwan, Ltd. ("KET") No. 9 Electronics, Inc. 6,000
No. 10 138,858
No. 11 25,000
No. 13 4,237
No. 14 180,840
No. 15 57,731
----------------------------------------------------------------------------------------
----------
(4) Prior to, on, or as soon as possible after the Effective Date, Xxxxxxx
Electronics, Inc. shall contribute all of its stock in its Subsidiaries to
Xxxxxxx Intermediate Holding, Inc.
(5) Gennum Corporation is a Canadian corporation listed on the Toronto Stock
Exchange.
(6) Pledgor's contribution to the issuer's registered capital is $1,750,000.
18
----------------------------------------------------------------------------------------
Xxxxxxx Electronics -- Xxxxxxx -- 100%
Trading (Shanghai) Co. Electronics, Inc.
Ltd.(7)
----------------------------------------------------------------------------------------
* Xxxxxxx Manufacturing 1 Xxxxxxx 1,000 100%
Ltd. ("KML") Electronics, Inc.
----------------------------------------------------------------------------------------
*Emkay Innovative 1 Xxxxxxx 100 100%
Products, Inc. Electronics, Inc.
----------------------------------------------------------------------------------------
Ruf N/A Xxxxxxx N/A 100%
Electronics, Inc.
----------------------------------------------------------------------------------------
*Synchro-Start Products, 1 Xxxxxxx 2,000 100%
Inc. ("SSPI") Electronics, Inc.
----------------------------------------------------------------------------------------
*Synchro-Start Products 1 SSPI 1 100%
Europe Limited 2 199,999
----------------------------------------------------------------------------------------
*Xxxxxxx Europe N/A KML N/A 100%
----------------------------------------------------------------------------------------
Debt Securities
---------------------------------------------------------------------------------------
Holder Issuer Principal Date of Maturity Date
------ ------ --------- ------- -------------
Amount Note
------ ----
---------------------------------------------------------------------------------------
*Xxxxxxx Wilbrecht $200,000 11/20/96 11/20/00
Electronics, Inc. Electronics, Inc.
---------------------------------------------------------------------------------------
**
---------------------------------------------------------------------------------------
*Xxxxxxx Ruwido $883,620.90 11/24/98 Upon 30 days
Electronics, Inc. notice by either
party
---------------------------------------------------------------------------------------
*KML Xxxxxxx Europe $3 million 12/31/98 12/31/01
---------------------------------------------------------------------------------------
----------
(7) Pledgor's contribution to the issuer's registered capital is $200,000.
**
(9) The loan may mature earlier pursuant to the terms of the agreement-this is
the latest possible maturity date.
** Confidential Information omitted and filed separately with the Securities and
Exchange Commission.
19
--------------------------------------------------------------------------------
See Intercompany Loan Agreements and Intercompany Advances disclosed on Schedule
6.01 to the Credit Agreement
--------------------------------------------------------------------------------
20
21
Annex 1 to the
Pledge Agreement
SUPPLEMENT NO. dated as of , to the Pledge
Agreement dated as of June 30, 1999, among XXXXXXX
ELECTRONICS, INC., a Delaware corporation (the "Parent
Borrower"), each Subsidiary of the Parent Borrower
listed on Schedule I hereto (each such Subsidiary
individually a "Subsidiary Pledgor" and collectively,
the "Subsidiary Pledgors"; the Parent Borrower and the
Subsidiary Pledgors are referred to collectively herein
as the "Pledgors") and THE CHASE MANHATTAN BANK, a New
York banking corporation ("Chase"), as administrative
agent (in such capacity, the "Administrative Agent") for
the Secured Parties (as defined in the Credit Agreement
referred to below).
A. Reference is made to (a) the Credit Agreement dated as of June 28, 1999
(as amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among the Borrower, the lenders from time to time party thereto
(the "Lenders"), Chase, as Administrative Agent, Swingline Lender and as issuing
bank (in such capacity, the "Issuing Bank"), and Xxxxxx Xxxxxxx Senior Funding,
Inc., as Syndication Agent, (b) the Parent Guarantee Agreement dated as of June
30, 1999 (as amended, supplemented or otherwise modified from time to time, the
"Parent Guarantee Agreement"), between the Parent Borrower and the
Administrative Agent and (c) the Subsidiary Guarantee Agreement dated as of June
30, 1999 (as amended, supplemented or otherwise modified from time to time, the
"Subsidiary Guarantee Agreement"; and, collectively with the Parent Guarantee
Agreement, the "Guarantee Agreements"), among the Subsidiary Pledgors and the
Administrative Agent.
B. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement.
C. The Pledgors have entered into the Pledge Agreement in order to induce
the Lenders to make Loans and the Issuing Bank to issue Letters of Credit.
Pursuant to Section 5.12 of the Credit Agreement, each Subsidiary of the Parent
Borrower that was not in existence or not a Subsidiary on the date of the Credit
Agreement is required to enter into the Pledge Agreement as a Subsidiary Pledgor
upon becoming a Subsidiary if such Subsidiary owns or possesses property of a
type that would be considered Collateral under the Pledge Agreement. Section 24
of the Pledge Agreement provides that such Subsidiaries may become Subsidiary
Pledgors under the Pledge Agreement by execution and delivery of an instrument
in the form of this Supplement. The undersigned Subsidiary (the "New Pledgor")
is executing this Supplement in accordance with the requirements of the Credit
Agreement to become a Subsidiary Pledgor under the Pledge Agreement in order to
induce the Lenders to make additional Loans and the Issuing Bank to issue
additional Letters of Credit and as consideration for Loans previously made and
Letters of Credit previously issued.
Accordingly, the Administrative Agent and the New Pledgor agree as
follows:
SECTION 1. In accordance with Section 24 of the Pledge Agreement, the New
Pledgor by its signature below becomes a Pledgor under the Pledge Agreement with
the same force and effect as if originally named therein as a Pledgor and the
New Pledgor hereby agrees (a) to all the terms and provisions of the Pledge
Agreement applicable to it as a Pledgor thereunder and (b) represents and
warrants that the representations and warranties made by it as a Pledgor
thereunder are true and correct on and as of the date hereof. In furtherance of
the foregoing, the New Pledgor, as security for the payment and performance in
full of the Obligations (as defined in the Pledge Agreement), does hereby create
and grant to the Administrative Agent, its successors and assigns, for the
benefit of the Secured Parties, their
22
2
successors and assigns, a security interest in and lien on all of the New
Pledgor's right, title and interest in and to the Collateral (as defined in the
Pledge Agreement) of the New Pledgor. Each reference to a "Subsidiary Pledgor"
or a "Pledgor" in the Pledge Agreement shall be deemed to include the New
Pledgor. The Pledge Agreement is hereby incorporated herein by reference.
SECTION 2. The New Pledgor represents and warrants to the Administrative
Agent and the other Secured Parties that this Supplement has been duly
authorized, executed and delivered by it and constitutes its legal, valid and
binding obligation, enforceable against it in accordance with its terms.
SECTION 3. This Supplement may be executed in counterparts, each of which
shall constitute an original, but all of which when taken together shall
constitute a single contract. This Supplement shall become effective when the
Administrative Agent shall have received counterparts of this Supplement that,
when taken together, bear the signatures of the New Pledgor and the
Administrative Agent. Delivery of an executed signature page to this Supplement
by facsimile transmission shall be as effective as delivery of a manually signed
counterpart of this Supplement.
SECTION 4. The New Pledgor hereby represents and warrants that set forth
on Schedule I attached hereto is a true and correct schedule of all its Pledged
Securities.
SECTION 5. Except as expressly supplemented hereby, the Pledge Agreement
shall remain in full force and effect.
SECTION 6. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 7. In case any one or more of the provisions contained in this
Supplement should be held invalid, illegal or unenforceable in any respect,
neither party hereto shall be required to comply with such provision for so long
as such provision is held to be invalid, illegal or unenforceable, but the
validity, legality and enforceability of the remaining provisions contained
herein and in the Pledge Agreement shall not in any way be affected or impaired.
The parties hereto shall endeavor in good-faith negotiations to replace the
invalid, illegal or unenforceable provisions with valid provisions the economic
effect of which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.
SECTION 8. All communications and notices hereunder shall be in writing
and given as provided in Section 15 of the Pledge Agreement. All communications
and notices hereunder to the New Pledgor shall be given to it in care of the
Parent Borrower.
SECTION 9. The New Pledgor agrees to reimburse the Administrative Agent
for its reasonable out-of-pocket expenses in connection with this Supplement,
including the reasonable fees, other charges and disbursements of counsel for
the Administrative Agent.
IN WITNESS WHEREOF, the New Pledgor and the Administrative Agent have duly
executed this Supplement to the Pledge Agreement as of the day and year first
above written.
[Name of New Pledgor],
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3
by
---------------------------------------
Name:
Title:
Address:
THE CHASE MANHATTAN BANK, as
Administrative Agent,
by
---------------------------------------
Name:
Title:
24
Schedule I to
Supplement No.
to the Pledge Agreement
Pledged Securities of the New Pledgor
CAPITAL STOCK
Number of Registered Number and Percentage of
Issuer Certificate Owner Class of Shares Shares
------ ----------- ----- --------------- ------
DEBT SECURITIES
Principal
Issuer Amount Date of Note Maturity Date
------ ------ ------------ -------------
