EXHIBIT 4.7
EXECUTION COPY
TIMBERLANDS PLEDGE AGREEMENT
TIMBERLANDS PLEDGE AGREEMENT, dated as of December 1,
1997, made by XXXXX-XXXXX INDUSTRIES, INC., a Delaware
corporation (the "Pledgor") in favor of CRESTAR BANK, a Virginia
banking corporation, as trustee (the "Trustee") for the benefit
of the holders of the Notes (as defined below).
W I T N E S S E T H :
WHEREAS, the Issuers (as defined below) have duly authorized
the creation and issuance of the Notes (as defined below), and
have authorized, executed and delivered the Indenture (as defined
below); and
WHEREAS, the obligations of the Issuers under the Notes and
the Indenture are secured by a pledge by the Pledgor of the
Timberlands Collateral (as defined below);
NOW, THEREFORE, in consideration of the premises, and to
induce (i) the Issuers to enter into the Indenture and (ii) to
enhance the creditworthiness of the Notes, the Pledgor hereby
agrees with the Trustee, for the benefit of Trustee and the
holders of the Notes, as follows:
I. Defined Terms. A. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned thereto
in the Indenture.
B. The following terms shall have the following meanings:
"Agent": as defined in the definition of Intercreditor
Agreement.
"Agreement": this Timberlands Pledge Agreement, as the same
may be amended, modified or otherwise supplemented from time to
time.
"Bank Credit Agreement": the credit agreement, dated as of
December 1, 1997 (as amended, supplemented or otherwise modified
from time to time) among Bear Island Paper Company, LLC (the
"Paper Company"), Toronto-Dominion (Texas), Inc., as
administrative agent (in such capacity, the "Paper Company
Agent"), the arranger party thereto and the Lenders parties
thereto (the "Paper Company Lenders").
"Bear Island Timberlands Company L.L.C.": a limited
liability company duly formed and existing under the laws of the
Commonwealth of Virginia, which is the issuer of the Pledged LLC
Interests.
"Code": the Uniform Commercial Code from time to time in
effect in the State of New York.
"Collateral Documents": the pledge agreement, dated as of
December 1, 1997, made by the Pledgor in favor of the Trustee
(the "Xxxxx Pledge Agreement"), the pledge and security
agreement, dated as of December 1, 1997, made by the Paper
Company in favor of the Trustee (the "Pledge and Security
Agreement"), and this Agreement, in each case as the same may be
amended, modified or otherwise supplemented from time to time."
"Credit Agreements": the collective reference to the Bank
Credit Agreement and the Timberlands Loan.
"Indenture": the indenture, dated as of December 1, 1997,
among the Issuers, the Pledgor, F.F. Xxxxx Inc., Bear Island
Timberlands Company, L.L.C. and the Trustee, as amended,
supplemented or otherwise modified from time to time.
"Intercreditor Agreement": the intercreditor agreement,
dated as of December 1, 1997 among the Trustee, the Issuers and
Toronto Dominion (Texas), Inc., as agent for the Timberlands
Agent for the benefit of the Timberlands Lenders and as agent for
the Paper Company Agent for the benefit of the Paper Company
Lenders (the "Agent"), as amended, supplemented or otherwise
modified from time to time.
"Issuers": the collective reference to Bear Island Paper
Company, L.L.C. and Bear Island Finance Company II.
"Lenders": the collective reference to the Paper Company
Lenders and the Timberlands Lenders.
"Paper Company": means Bear Island Company LLC.
"Pledged LLC Interests": in each case, whether now existing
or hereafter acquired, all of the Pledgor's right, title and
interest in and to:
(a) equity interests of Bear Island Timberlands
Company, L.L.C., but not the Pledgor's obligations from time
to time as a holder of equity interests in Bear Island
Timberlands Company, L.L.C. (unless the Trustee or its
designee, on behalf of the Trustee, shall elect to become a
holder of interests in Bear Island Timberlands Company,
L.L.C. in connection with its exercise of remedies pursuant
to the terms hereof);
(b) any and all moneys due and to become due to the
Pledgor now or in the future by way of a distribution made
to the Pledgor in its capacity as a holder of equity
interests in the Bear Island Timberlands Company, L.L.C. or
otherwise in respect of the Pledgor's interest as a holder
of equity interests in the Bear Island Timberlands Company,
L.L.C.;
(c) any other property of the Bear Island Timberlands
Company, L.L.C. to which the Pledgor now or in the future
may be entitled in respect of its equity interests in the
Bear Island Timberlands Company, L.L.C. by way of
distribution, return of capital or otherwise;
(d) any other claim or right which the Pledgor now has
or may in the future acquire in respect of its equity
interests in the Bear Island Timberlands Company, L.L.C.;
(f) all certificates, options or rights of any nature
whatsoever that may be issued or granted by the Bear Island
Timberlands Company, L.L.C. with respect to the equity
interests of the Bear Island Timberlands Company, L.L.C. to
the Pledgor while this Agreement is in effect; and
(g) to the extent not otherwise included, all Proceeds
of any or all of the foregoing.
"Proceeds": all "proceeds" as such term is defined in
Section 9-306(1) of the Uniform Commercial Code in effect in the
State of New York on the date hereof and, in any event, shall
include, without limitation, all dividends or other income from
the Pledged LLC Interests, collections thereon or distributions
with respect thereto.
"Secured Obligations": the collective reference to (a) the
obligations of the Issuers under the Indenture, and (b) all
obligations and liabilities of the Pledgor that may arise under
or in connection with this Agreement or any other Collateral
Document to which the Pledgor is a party, whether on account of
fees, indemnities, costs, expenses or otherwise that are required
to be paid by the Pledgor pursuant to the terms thereof
(including without limitation all reasonable fees and
disbursements of counsel to the Trustee or to the Issuers that
are required to be paid to the Pledgor pursuant to the terms of
this Agreement or any other Collateral Document to which the
Pledgor is a party.
"Securities Act": the Securities Act of 1933, as amended.
"Senior Timberlands Pledge Agreement": Timberlands Pledge
Agreement, as defined in the Bank Credit Agreement and the
Timberlands Loan.
"Timberlands Collateral": the Pledged LLC Interests and all
Proceeds.
"Timberlands Collateral Account": any account established
to hold cash Proceeds, maintained under the dominion and control
of the Trustee, subject to withdrawal by the Trustee for the
account of the holders of the Notes only as provided in paragraph
VII(A) of this Agreement.
"Timberlands Loan": the credit agreement, dated as of
December 1, 1997 (as amended, supplemented or otherwise modified
from time to time) among the Pledgor, Toronto-Dominion (Texas),
Inc., as administrative agent (in such capacity, the "Timberlands
Agent") and the Lenders parties thereto (the "Timberlands
Lenders").
"Timberlands Lenders": as defined in the definition of the
Timberlands Credit Agreement.
C. The words "hereof," "herein" and "hereunder" and words
of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this
Agreement, and section and paragraph references are to this
Agreement unless otherwise specified.
D. The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such
terms.
II. Pledge; Grant of Security Interest; Designation of
Trustee. (a) The Pledgor hereby grants to the Trustee, for the
benefit of the holders of the Notes, a security interest in the
Timberlands Collateral, subject only to the security interest in
the Timberlands Collateral pledged by the Pledgor pursuant to the
Senior Timberlands Pledge Agreement, as collateral security for
the prompt and complete payment and performance when due (whether
at the stated maturity, by acceleration or otherwise) of the
Secured Obligations of the Issuers.
III. Representations and Warranties. The Pledgor
represents and warrants that:
A. The Pledgor has the corporate power and authority and
the legal right to execute and deliver, to perform its
obligations under, and to grant the security interests in the
Timberlands Collateral pursuant to, this Agreement and has taken
all necessary corporate action to authorize its execution,
delivery and performance of, and grant of the security interests
in the Timberlands Collateral pursuant to, this Agreement.
B. This Agreement constitutes a legal, valid and binding
obligation of the Pledgor, enforceable in accordance with its
terms, and upon the filing of a UCC-1 financing statement in
appropriate form in the office of the Secretary of State of
Connecticut, the security interests created pursuant to this
Agreement will constitute a valid, perfected third priority
security interest in the Timberlands Collateral in favor of the
Trustee enforceable in accordance with its terms against all
creditors of the Pledgor and any Persons purporting to purchase
any Timberlands Collateral from the Pledgor, except in each case
as enforceability may be affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a
proceeding in equity or at law) and an implied covenant of good
faith and fair dealing.
C. The Pledged LLC Interests constitute all of the issued
and outstanding equity interests of the Timberland Issuer.
D. All of the Pledged LLC Interests have been duly and
validly issued.
E. The Pledgor is the owner of, and has title to, the
Pledged LLC Interests, free of any and all Liens or options in
favor of, or claims of, any other Person, except the security
interests and Liens created by the Senior Timberlands Pledge
Agreement.
IV. Covenants. The Pledgor covenants and agrees with the
Trustee that, from and after the date of this Agreement until
this Agreement is terminated and the security interests created
hereby are released in accordance with the terms hereof:
A. If the Pledgor shall, as a result of its ownership of
the Pledged LLC Interests, become entitled to receive or shall
receive any certificate (including, without limitation, any
certificate representing a stock dividend or a distribution in
connection with any reclassification, increase or reduction of
capital or any certificate issued in connection with any
reorganization), option or rights, whether in addition to, in
substitution of, as a conversion of, or in exchange for any
equity interests of the Pledged LLC Interests, or otherwise in
respect thereof, the Pledgor shall accept the same as the agent
of the Trustee, hold the same in trust for the Trustee and
deliver the same forthwith to the Trustee, in the exact form
received, duly indorsed by the Pledgor in blank, as applicable,
if required, together with an undated power covering such
certificate duly executed in blank by the Pledgor and with, if
the Trustee, so requests, signature guaranteed, to be held by the
Trustee, as applicable, subject to the terms hereof, the
Intercreditor Agreement and the Senior Timberlands Pledge
Agreement, as additional collateral security for the Secured
Obligations. Any sums paid upon or in respect of the Pledged LLC
Interests upon the liquidation or dissolution of the Bear Island
Timberlands Company, L.L.C. shall be paid over to the Trustee, as
applicable, to be held by it hereunder as additional collateral
security for the Secured Obligations, and in case any
distribution of capital shall be made on or in respect of the
Pledged LLC Interests or any property shall be distributed upon
or with respect to the Pledged LLC Interests, in each case
pursuant to the recapitalization or reclassification of the
capital of the Timberlands or pursuant to the reorganization
thereof, the property so distributed shall be delivered to the
Trustee to be held by it hereunder as additional collateral
security for the Secured Obligations. If any sums of money or
property so paid or distributed in respect of the Pledged LLC
Interests (other than distributions permitted to be made or
received pursuant to the Credit Agreements or the Indenture)
shall be received by the Pledgor, the Pledgor shall, until such
money or property is paid or delivered to the Trustee hold such
money or property in trust for the holders of the Notes,
segregated from other funds of the Pledgor, as additional
collateral security for the Secured Obligations.
B. Except as permitted by any Credit Agreement, so long as
such Credit Agreement is in effect, or the Indenture, without the
prior written consent of the Trustee, the Pledgor will not (1.)
vote to enable, or take any other action to permit, the Bear
Island Timberlands Company, L.L.C. to issue any stock or other
equity securities of any nature or to issue any other securities
convertible into or granting the right to purchase or exchange
for any stock or other equity securities of any nature of the
Bear Island Timberlands Company, L.L.C. except issuances of
equity interests to the Pledgor which constitute Timberlands
Collateral hereunder or under the Senior Timberlands Pledge
Agreement, (2.) sell, assign, transfer, exchange, or otherwise
dispose of, or grant any option with respect to, the Timberlands
Collateral, (3.) create, incur or permit to exist any Lien or
option in favor of, or any claim of any Person with respect to,
any of the Timberlands Collateral, or any interest therein,
except for the security interests created by this Agreement or
under the Senior Timberlands Pledge Agreement or (4.) enter into
any agreement or undertaking restricting the right or ability of
the Pledgor or the Trustee (after foreclosure) to sell, assign or
transfer any of the Timberlands Collateral other than such
restrictions under the Credit Agreements, the Senior Timberlands
Pledge Agreement, the Indenture, this Agreement or the other
Collateral Documents.
C. The Pledgor shall maintain the security interest created
by this Agreement as a perfected security interest, and shall
defend such security interests against claims and demands of all
Persons whomsoever except for permitted liens. At any time and
from time to time, upon the written request of the Trustee, and
at the sole expense of the Pledgor, the Pledgor will promptly and
duly execute and deliver such further instruments and documents
and take such further actions as the Trustee may reasonably
request for the purposes of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein
granted, including, without limitation, the filing of any
financing or continuation statements under the Uniform Commercial
Code (or similar laws) in effect in any jurisdiction with respect
to the security interests created hereby. If any amount payable
under or in connection with any of the Timberlands Collateral (to
the extent that such amounts are otherwise required by this
Agreement to be paid to the Trustee) shall be or become evidenced
by any promissory note, other instrument or chattel paper, such
note, instrument or chattel paper in excess of $500,000 shall
promptly upon receipt by the Pledgor be delivered to the Trustee,
duly endorsed in a manner satisfactory to the Trustee, to be held
as Timberlands Collateral pursuant to this Agreement.
D. With respect to the Pledged LLC Interests, the Pledgor
shall and shall cause the Bear Island Timberlands Company, L.L.C.
to, directly or indirectly, (i) perform and comply in all
material respects with all the terms and provisions of any
limited liability company agreement then in effect with respect
thereto and required to be performed or complied by it and
(ii) enforce any limited liability company agreement then in
effect in accordance with its terms.
E. The Pledgor shall pay, and save the Trustee harmless
from, any and all liabilities with respect to, or resulting from
any delay in paying, any and all stamp, excise, sales or other
similar taxes which may be payable or determined to be payable
with respect to any of the Timberlands Collateral or in
connection with any of the transactions contemplated by this
Agreement.
V. Voting Rights. No vote shall be cast or corporate right
exercised or other action taken which, in the Trustee's
reasonable judgment, would impair in any material respect the
Timberlands Collateral or which would be inconsistent with or
result in any violation of any provision of this Agreement, any
other Collateral Document or the Indenture.
VI. Rights of the Trustee. A. All money Proceeds received
by the Trustee hereunder shall be held by the Trustee in a
Timberlands Collateral Account. All Proceeds while held by the
Trustee in a Collateral Account (or by the Pledgor in trust for
the Trustee) shall continue to be held as collateral security for
all the Secured Obligations and shall not constitute payment
thereof until applied as provided in paragraph VII(A).
B. If an Event of Default shall occur and be continuing and
the Trustee gives notice of its intent to exercise such rights to
the Pledgor, to the extent permitted by the Intercreditor
Agreement, (1.) the Trustee shall have the right to receive any
and all cash dividends and distributions paid in respect of the
Pledged LLC Interests and make application thereof to the Secured
Obligations in such order as the Trustee may determine, and (2.)
all equity interest of the Pledged LLC Interests shall be
registered in the name of the Trustee or its nominee, and the
Trustee or its nominee may thereafter exercise (a.) all voting,
corporate and other rights pertaining to such Pledged LLC
Interests at any meeting of shareholders of the Bear Island
Timberlands Company, L.L.C. or otherwise and (b.) any and all
rights of conversion, exchange, subscription and any other
rights, privileges or options pertaining to such Pledged LLC
Interests as if it were the absolute owner thereof (including,
without limitation, the right to exchange at its discretion any
and all of the Pledged LLC Interests upon the merger,
consolidation, reorganization, recapitalization or other
fundamental change in the corporate structure of the Bear Island
Timberlands Company, L.L.C., or upon the exercise by the Pledgor
or the Trustee of any right, privilege or option pertaining to
such Pledged LLC Interests, and in connection therewith, the
right to deposit and deliver any and all of the Pledged LLC
Interests with any committee, depositary, transfer agent,
registrar or other designated agency upon such terms and
conditions as the Trustee may determine), all without liability
except to account for property actually received by it, but the
Trustee shall have no duty to the Pledgor to exercise any such
right, privilege or option and shall not be responsible for any
failure to do so or delay in so doing.
VII. Remedies. A. If an Event of Default shall have
occurred and be continuing, at any time at the Trustee's
election, the Trustee may apply all or any part of Proceeds held
in any Timberlands Collateral Account in payment of the Secured
Obligations in accordance with the Intercreditor Agreement and as
permitted by law.
B. If an Event of Default shall occur and be continuing,
the Trustee, on behalf of the holders of the Notes, may exercise,
in addition to all other rights and remedies granted in this
Agreement and in any other instrument or agreement securing,
evidencing or relating to the Secured Obligations, and as
permitted by the Intercreditor Agreement all rights and remedies
of a secured party under the Code. Without limiting the
generality of the foregoing, the Trustee, to the extent permitted
by law and the Intercreditor Agreement, without demand of
performance or other demand, presentment, protest, advertisement
or notice of any kind (except any notice required by law referred
to below) to or upon the Pledgor or any other Person (all and
each of which demands, defenses, advertisements and notices are
hereby waived), may in such circumstances forthwith collect,
receive, appropriate and realize upon the Timberlands Collateral,
or any part thereof, and/or may forthwith sell, assign, give
option or options to purchase or otherwise dispose of and deliver
the Timberlands Collateral or any part thereof (or contract to do
any of the foregoing), in one or more parcels at public or
private sale or sales, in the over-the-counter market, at any
exchange, broker's board or office of the Trustee or elsewhere
upon such terms and conditions as it may deem advisable and at
such prices as it may deem best, for cash or on credit or for
future delivery without assumption of any credit risk. The
Trustee shall have the right upon any such public sale or sales,
and, to the extent permitted by law and the Intercreditor
Agreement, upon any such private sale or sales, to purchase the
whole or any part of the Timberlands Collateral so sold, free of
any right or equity of redemption in the Pledgor, which right or
equity is waived or released upon the consummation of such sale.
The Trustee shall apply any Proceeds from time to time held by it
and the net proceeds of any such collection, recovery, receipt,
appropriation, realization or sale, after deducting all
reasonable costs and expenses of every kind incurred in respect
thereof or incidental to the care or safekeeping of any of the
Timberlands Collateral or in any way relating to the Timberlands
Collateral or the rights of the Trustee hereunder, including,
without limitation, reasonable attorneys' fees and reasonable
disbursements of counsel to the Trustee, to the payment in whole
or in part of the Secured Obligations, in accordance with the
Intercreditor Agreement and as permitted by law, and only after
such application and after the payment by the Trustee of any
other amount required by any provision of law, including, without
limitation, Section 9-504(1)(c) of the Code, need the Trustee
account for the surplus, if any, to the Pledgor. To the extent
permitted by applicable law, the Pledgor waives all claims,
damages and demands it may acquire against the Trustee arising
out of the exercise by the Trustee of any rights hereunder,
except to the extent arising out of negligence or bad faith of
the Trustee. If any notice of a proposed sale or other
disposition of Timberlands Collateral shall be required by law,
such notice shall be deemed reasonable and proper if given at
least 10 days before such sale or other disposition.
VIII. Registration Rights; Private Sales. A. If the
Trustee shall determine to exercise its right to sell any or all
of the Pledged LLC Interests pursuant to paragraph VII(B) hereof,
and if in the reasonable opinion of the Trustee it is necessary
or advisable to have the Pledged LLC Interests, or that portion
thereof to be sold, registered under the provisions of the
Securities Act, the Pledgor will cause the Timberland Issuer
thereof to (1.) execute and deliver, and cause the directors and
officers of the Timberland Issuer to execute and deliver, all
such instruments and documents, and do or cause to be done all
such other acts as may be, in the reasonable opinion of the
Trustee, necessary or advisable to register the Pledged LLC
Interests, or that portion thereof to be sold, under the
provisions of the Securities Act, (2.) to use its reasonable
efforts to cause the registration statement relating thereto to
become effective and to remain effective for a period of one year
from the date of the first public offering of the Pledged LLC
Interests, or that portion thereof to be sold, and (3.) to make
all amendments thereto and/or to the related prospectus which, in
the reasonable opinion of the Trustee, are necessary or
advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities
and Exchange Commission applicable thereto. The Pledgor agrees
to cause the Timberland Issuer to comply with the provisions of
the securities or "Blue Sky" laws of any and all jurisdictions of
the United States which the Trustee shall designate and to make
available to its security holders, as soon as practicable, an
earnings statement (which need not be audited) which will satisfy
the provisions of Section 11(a) of the Securities Act.
B. The Pledgor recognizes that the Trustee may be unable to
effect a public sale of any or all the Pledged LLC Interests, by
reason of certain prohibitions contained in the Securities Act
and applicable state securities laws or otherwise, and may be
compelled to resort to one or more private sales thereof to a
restricted group of purchasers which will be obliged to agree,
among other things, to acquire such securities for their own
account for investment and not with a view to the distribution or
resale thereof. The Pledgor acknowledges and agrees that any
such private sale may result in prices and other terms less
favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private
sale shall be deemed to have been made in a commercially
reasonable manner. The Trustee shall be under no obligation to
delay a sale of any of the Pledged LLC Interests for the period
of time necessary to permit the Bear Island Timberlands Company,
L.L.C. thereof to register such securities for public sale under
the Securities Act, or under applicable state securities laws of
the United States, even if the Bear Island Timberlands Company,
L.L.C. would agree to do so.
C. The Pledgor further agrees to use its reasonable efforts
to do or cause to be done all such other acts as may be necessary
to make such sale or sales of all or any portion of the Pledged
LLC Interests pursuant to this Section valid and binding and in
compliance with any and all other applicable Requirements of Law.
The Pledgor further agrees that a breach of any of the covenants
contained in this Section will cause irreparable injury to the
Trustee, that the Trustee have no adequate remedy at law in
respect of such breach and, as a consequence, that each and every
covenant contained in this Section shall be specifically
enforceable against the Pledgor, and the Pledgor hereby waives
and agrees not to assert any defenses against an action for
specific performance of such covenants except for a defense that
no Event of Default has occurred under the Indenture.
IX. Irrevocable Authorization and Instruction to Bear
Island Timberlands Company, L.L.C.. The Pledgor hereby
authorizes and instructs the Bear Island Timberlands Company,
L.L.C. to comply with any instruction received by it from the
Trustee in writing that (a) states that an Event of Default has
occurred and is continuing and (b) is otherwise in accordance
with the terms of this Agreement, without any other or further
instructions from the Pledgor, and the Pledgor agrees that the
Bear Island Timberlands Company, L.L.C. shall be fully protected
in so complying.
X. Trustee's Appointment as Attorney-in-Fact. A. The
Pledgor hereby irrevocably constitutes and appoints the Trustee
and any officer or agent of the Trustee, with full power of
substitution, as its true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of the
Pledgor and in the name of the Pledgor or in the Trustee's own
name, from time to time in the Trustee's discretion, for the
purpose of carrying out the terms of this Agreement, to take any
and all appropriate action and to execute any and all documents
and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, including, without limitation,
any financing statements, endorsements, assignments or other
instruments of transfer, which power of attorney is only
exercisable if an Event of Default shall have occurred and be
continuing.
B. The Pledgor hereby ratifies all that said attorneys
shall lawfully do or cause to be done pursuant to the power of
attorney granted in paragraph X(A). All powers, authorizations
and agencies contained in this Agreement are coupled with an
interest and are irrevocable until this Agreement is terminated
and the security interests created hereby are released in
accordance with the terms hereof.
XI. Duty of Trustee. The Trustee's sole duty with respect
to the custody, safekeeping and physical preservation of the
Timberlands Collateral in its possession, under Section 9-207 of
the Code or otherwise, shall be to deal with it in the same
manner as the Trustee deals with similar securities and property
for its own account, except that after the occurrence and during
the continuance of an Event of Default the Trustee shall have no
obligation to invest funds held in any Collateral Account and may
hold the same as demand deposits. Neither the Trustee nor any of
its respective directors, officers, employees or agents shall be
liable for failure to demand, collect or realize upon any of the
Timberlands Collateral or for any delay in doing so (unless the
same shall result from the gross negligence or willful misconduct
of such Person) or shall be under any obligation to sell or
otherwise dispose of any Timberlands Collateral upon the request
of the Pledgor or any other Person or to take any other action
whatsoever with regard to the Timberlands Collateral or any part
thereof.
XII. Execution of Financing Statements. Pursuant to
Section 9-402 of the Code, the Pledgor authorizes the Trustee to
file financing statements with respect to the Timberlands
Collateral without the signature of the Pledgor in such form and
in such filing offices as the Trustee reasonably determines
appropriate to perfect the security interests of the Trustee
under this Agreement. A carbon, photographic or other
reproduction of this Agreement shall be sufficient as a financing
statement for filing in any jurisdiction.
XIII. Authority of Trustee. The Pledgor acknowledges that
the rights and responsibilities of the Trustee under this
Agreement with respect to any action taken by the Trustee or the
exercise or non-exercise by the Trustee of any option, voting
right, request, judgment or other right or remedy provided for
herein or resulting or arising out of this Agreement shall, as
between the Trustee and the noteholders, be governed by the
Indenture and the Intercreditor Agreement, but, as between the
Trustee and the Pledgor, the Trustee shall be conclusively
presumed to be acting as a fiduciary pursuant to the Indenture
with full and valid authority so to act or refrain from acting,
and neither the Pledgor nor the Bear Island Timberlands Company,
L.L.C. shall be under any obligation, or entitlement, to make any
inquiry respecting such authority.
XIV. Notices. All notices, requests and demands to or upon
the Trustee or the Pledgor to be effective shall be in writing
(including by telecopy) and, unless otherwise expressly provided
herein, shall be deemed to have been duly given or made when
delivered or three Business Days after being deposited in the
mails, postage prepaid, or in the case of telecopy notice, when
received, addressed as follows:
1. if to the Trustee, at its address or transmission number
for notices provided below:
Crestar Bank
Attention: Corporate Trust Department
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
2. if to the Pledgor, at its address or transmission
number for notices set forth under its signature below.
The Trustee and the Pledgor may change their addresses and
transmission numbers for notices by notice in the manner provided
in this Section.
XV. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
XVI. Amendments in Writing; No Waiver; Cumulative
Remedies. A. None of the terms or provisions of this Agreement
may be waived, amended, supplemented or otherwise modified except
by a written instrument executed by the Pledgor and the Trustee,
provided that any provision of this Agreement may be waived by
the Trustee in a letter or agreement executed by the Trustee or
by telex or facsimile transmission from the Trustee.
B. The Trustee shall not (except by a written instrument
pursuant to paragraph XVI(A) hereof), delay, indulgence, omission
or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any Default or Event of
Default or in any breach of any of the terms and conditions
hereof. No failure to exercise, nor any delay in exercising, on
the part of the Trustee, any right, power or privilege hereunder
shall operate as a waiver thereof. No single or partial exercise
of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other
right, power or privilege. A waiver by the Trustee of any right
or remedy hereunder on any one occasion shall not be construed as
a bar to any right or remedy which the Trustee would otherwise
have on any future occasion.
C. The rights and remedies herein provided are cumulative,
may be exercised singly or concurrently and are not exclusive of
any other rights or remedies provided by law.
XVII. Senior Timberlands Pledge Agreement. The lien and
all terms and provisions on this Agreement are subordinate and
subject to the lien and all terms and provisions of the Senior
Timberlands Pledge Agreement. Subject to the provisions of the
Intercreditor Agreement, to the extent the Pledgor's performance
of any obligation under this Agreement would result in a default
or breach by the Pledgor under the Senior Timberlands Pledge
Agreement, then Pledgor shall have no duty to perform such
obligation under this Agreement to the extent such performance
would constitute a default under the Senior Timberlands Pledge
Agreement. Notwithstanding any other provision in this
Agreement, the Trustee will not accept possession of any
Timberlands Collateral or take any action with respect to the
Timberlands Collateral (including, without limitation, the
exercise of any remedies) except in accordance with and as
permitted by the Intercreditor Agreement
XVIII. Limitation on Recourse. Anything herein to contrary
notwithstanding, the Trustee shall have recourse in respect of
the Secured Obligations solely to the Timberlands Collateral and
not to the Pledgor personally or to assets of the Pledgor other
than the Timberlands Collateral.
XIX. Intercreditor Agreement. Anything to the contrary set
forth herein notwithstanding, this Agreement shall be subject to
and governed by the terms and conditions of the Intercreditor
Agreement.
XX. Controlling Agreement. In the case of any conflict,
inconsistency, or ambiguity between the terms of (i) the
Indenture and this Agreement, the Indenture shall control and
(ii) the Senior Xxxxx Pledge Agreement and this Agreement, the
Senior Xxxxx Pledge Agreement shall control.
XXI. Section Headings. The section headings used in this
Agreement are for convenience of reference only and are not to
affect the construction hereof or be taken into consideration in
the interpretation hereof.
XXII. Term of this Agreement. This Agreement shall
continue in full force and effect until the Obligations and the
obligations of the Pledgor hereunder shall be paid in full and
the Commitments shall have been terminated. Upon such payment
and termination, this Agreement shall automatically terminate and
the security interests, pledges and liens hereunder released and
the Trustee shall, upon the request of the Pledgor and at the
Pledgor's expense, execute and deliver to the Pledgor such
documents and instruments evidencing such termination and
release.
XXIII. Successors and Assigns. This Agreement shall be
binding upon the successors and assigns of the Pledgor and shall
inure to the benefit of the Trustee and their successors and
assigns.
XXIV. Governing Law. This Agreement shall be governed by,
and construed and interpreted in accordance with, the law of the
State of New York.
IN WITNESS WHEREOF, the undersigned has caused this
Agreement to be duly executed and delivered as of the date first
above written.
XXXXX-XXXXX INDUSTRIES, INC.
By /s/ Xxxxxx X. Xxxxxxxx
Title Senior Vice President
Address for Notices:
Xxxx Xxxxxx Xxx 0000
00 Xxxxx Xxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Phone: 000-000-0000
Fax: 000-000-0000
ACKNOWLEDGEMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the
Pledge Agreement dated December 1, 1997, made by Xxxxx-Xxxxx
Industries, Inc. for the benefit of Crestar Bank, as Trustee (the
"Pledge Agreement"). The undersigned agrees for the benefit of
the Trustee as follows:
1. The undersigned will be bound by the terms of the Pledge
Agreement and will comply with such terms insofar as such terms
are applicable to the undersigned.
2. The undersigned will notify the Trustee promptly in
writing of the occurrence of any of the events described in
paragraph IV(A) of the Pledge Agreement.
3. The terms of paragraph IX of the Pledge Agreement shall
apply to it, mutatis mutandis, with respect to all actions that
may be required of it under or pursuant to or arising out of
Section 8 of the Pledge Agreement.
4. The undersigned agrees that it will not take any action,
or fail to take any action, that will permit the Pledged LLC
Interests to become "securities" within the meaning of Article 8
of the Uniform Commercial Code of the State of New York (the
"NYUCC") unless (i) the Bear Island Timberlands Company, L.L.C.
shall have provided 30 days prior written notice to the Trustee
and (ii) at the sole expense of the Bear Island Timberlands
Company, L.L.C., the Bear Island Timberlands Company, L.L.C.
shall promptly and duly execute and deliver such further
instruments and documents, and take such further action as the
Trustee shall reasonably request to ensure that the Trustee has
"control" of such securities within the meaning of Article 8 of
the NYUCC for the purposes of obtaining or preserving the full
benefits of the Timberlands Pledge Agreement and of the rights
and powers granted therein.
BEAR ISLAND TIMBERLANDS COMPANY,
L.L.C.
By ____________________________
Title ________________________
Address for Notices:
Telex: ________________________
Fax: __________________________
SCHEDULE 1
TO PLEDGE AGREEMENT
DESCRIPTION OF PLEDGED LLC INTERESTS
Percentage
Type of Interest Interest
Membership 100%
Interest