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EXHIBIT 2.8
STOCK PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT ("Agreement"), is made and entered into as
of November 29, 1999, by and between Xxxxxxx Corporation, a Delaware corporation
("Secured Party"), and ___________________. ("Debtor"). In order to secure
payment of that certain promissory note (the "Note") dated as of the date
hereof, payable to the order of Secured Party in the principal amount of
_______________, Debtor hereby grants Secured Party a security interest in, and
assigns, transfers to and pledges Secured Party the following securities and
other property:
(i) the ________ shares of the common stock of The TriZetto
Group, Inc., a Delaware corporation, ("Common Stock") deposited with Secured
Party as Collateral for the Note;
(ii) any and all new, additional or different securities or other
property subsequently distributed with respect to the shares identified in
subparagraph (i) that are to be delivered to and deposited with Secured Party
pursuant to the requirements of paragraph 3 of this Agreement;
(iii)any and all other property and money that is delivered to or
comes into the possession of Secured Party pursuant to the terms and provisions
of this Agreement; and
(iv) the proceeds of any sale, exchange or disposition of the
property and securities described in subparagraphs (i), (ii) or (iii) above.
All securities, property and money so assigned, transferred to and
pledged to Secured Party shall be herein referred to as the "Collateral" and
shall be accompanied by one or more stock power assignments properly endorsed by
the Debtor. Secured Party shall hold the Collateral in accordance with the
following terms and provisions:
1. WARRANTIES. The Debtor hereby warrants that the Debtor is the owner
of the Collateral and has the right to pledge the Collateral and that the
Collateral is free from all liens, adverse claims and other security interests
(other than those created hereby).
2. RIGHTS AND POWERS. Secured Party may without obligation to do so,
exercise one or more of the following rights and powers with respect to the
Collateral:
(a) accept in its discretion, but subject to the applicable
limitations of paragraph 6(c), other property of the Debtor in exchange for all
or part of the Collateral and release Collateral to the Debtor to the extent
necessary to effect such exchange, and in such event the money, property or
securities received in the exchange shall be held by Secured Party as substitute
security for the Note and all other indebtedness secured hereunder,
(b) perform such acts as are necessary to preserve and protect
the Collateral and the rights, powers and remedies granted with respect to such
Collateral by this Agreement; and
(c) transfer record ownership of the Collateral to Secured Party
or its nominee and receive, endorse and give receipt for, or collect by legal
proceedings or otherwise, dividends or other distributions made or paid with
respect to the Collateral, provided and only if there exists at the time an
outstanding event of default under paragraph 7 of this Agreement.
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Secured Party will notify the Debtor of any action taken by it
pursuant to the provisions of this Section 2. Expenses reasonably incurred in
connection with such action shall be payable by the Debtor and form part of the
indebtedness secured hereunder as provided in paragraph 9.
So long as there exists no event of default under Section 7 of
this Agreement, the Debtor may exercise all stockholder voting rights and be
entitled to receive any and all regular cash dividends paid on the Collateral.
Accordingly, until such time as an event of default occurs under this Agreement,
all stockholder materials pertaining to the Collateral shall be delivered to the
Debtor at the address indicated below.
Any cash sums that Secured Party may receive in the exercise of
his rights and powers under paragraph 2(c) above shall be applied to the payment
of the Note and any other indebtedness secured hereunder, in such order of
application as Secured Party deems appropriate. Any remaining cash shall be paid
over to the Debtor.
3. DUTY TO DELIVER. Any new, additional or different securities that may
now or hereafter become distributable with respect to the Collateral by reason
of (i) any stock dividend, stock split or reclassification of the Common Stock,
or (ii) any merger, consolidation or other reorganization affecting the capital
structure of The TriZetto Group, Inc., a Delaware corporation ("TriZetto")
shall, upon receipt by the Debtor, be promptly delivered to and deposited with
Secured Party as part of the Collateral hereunder. Such securities shall be
accompanied by one or more properly endorsed stock power assignments.
4. CARE OF COLLATERAL. Secured Party shall exercise reasonable care in
the custody and preservation of the Collateral, but shall have no obligation to
initiate any action with respect to any conversion, call, exchange right,
preemptive right, subscription right, purchase offer or other right or privilege
relating to or affecting the Collateral. Secured Party shall have no duty to
preserve the rights of the Debtor against adverse claims or to protect the
Collateral against the possibility of a decline in market value. Secured Party
shall not be obligated to take any action with respect to the Collateral
requested by the Debtor unless the request is made in writing and Secured Party
determines that the requested action will not unreasonably jeopardize the value
of the Collateral as security for the Note and other indebtedness secured
hereunder.
Secured Party may at any time release and deliver all or part of the
Collateral to the Debtor, and the receipt thereof by the Debtor shall constitute
a complete and full acquittance for the Collateral so released and delivered.
Secured Party shall accordingly be discharged from any further liability or
responsibility for the Collateral, and the released Collateral shall no longer
be subject to the provisions of this Agreement. However, any and all release of
the Collateral shall be effected in compliance with the applicable limitations
of paragraph 6(c).
5. PAYMENT OF TAXES AND OTHER CHANGES. The Debtor shall pay, prior to
the delinquency date, all taxes, liens, assessments and other charges against
the Collateral, and in the event of the Debtor's failure to do so, Secured Party
may at its election pay any or all of such taxes and charges without contesting
the validity or legality thereof. The payment so made shall become a part of the
indebtedness secured hereunder and until paid shall bear interest at the per
annum rate equal to the minimum per annum rate, compounded annually, required to
avoid the imputation of interest income to Secured Party and compensation income
to the Debtor under federal tax laws.
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6. RELEASE OF COLLATERAL. Provided (i) all indebtedness secured
hereunder shall at the time have been paid in full or cancelled and (ii) there
does not otherwise exist any event of default under Section 7, the pledged
shares of Common Stock together with any additional Collateral that may
hereafter be pledged and deposited hereunder, shall be released from pledge and
returned to the Debtor in accordance with the following provisions:
(a) Upon payment or prepayment of principal under the Note,
together with payment of all accrued interest to date, one or more shares of the
Common Stock held as Collateral hereunder shall (subject to the applicable
limitations of paragraph 6(c) below) be released to the Debtor within three days
after such payment or prepayment. The number of the shares to be so released
shall be equal to the number obtained by multiplying (i) the total number of
shares of Common Stock held under this Agreement at the time of the payment or
prepayment, by (ii) a fraction the numerator of which shall be the amount of the
principal paid or prepaid and the denominator of which shall be, the unpaid
principal balance of the Note immediately prior to such payment or prepayment.
In no event, however, shall any fractional shares be released.
(b) Any additional Collateral that may hereafter be pledged and
deposited with Secured Party (pursuant to the requirements of Section 3) with
respect to the shares of Common Stock pledged hereunder shall be released at the
same time the particular shares of Common Stock to which the additional
Collateral relates are to be released in accordance with the applicable
provisions of paragraph 6(a). Under no circumstances, however, shall any shares
of Common Stock or any other Collateral be released if previously applied to the
payment of any indebtedness secured hereunder.
(c) In no event, however, shall any shares of Common Stock be
released pursuant to the provisions of paragraph 6(a) or 6(b) if, and to the
extent, the fair market value of the Common Stock and all other Collateral that
would otherwise remain in pledge hereunder after such release were effected
would be less than the unpaid balance of the Note (principal and accrued
interest).
(d) For all valuation purposes under this Agreement, the fair
market value per share of Common Stock on any relevant date shall be determined
in accordance with the following provisions:
(i) If the Common Stock is not at the time listed or
admitted to trading on any stock exchange but is traded in the
over-the-counter market, the fair market value shall be the mean between
the highest bid and lowest asked prices (or, if such information is
available, the closing selling price) per share of Common Stock on the
date in question in the over-the-counter market, as such prices are
reported by the National Association of Securities Dealers on the NASDAQ
National Market or any successor system. If there are no reported bid
and asked prices (or closing selling price) for the Common Stock on the
date in question, then the mean between the highest bid price and lowest
asked price (or the closing selling price) on the last preceding date
for which such quotations exist shall be determinative of fair market
value.
(ii) If the Common Stock is at the time listed or admitted
to trading on any stock exchange, then the fair market value shall be
the closing selling price per share of Common Stock on the date in
question on the stock exchange serving as the primary market for the
Common Stock, as such price is officially quoted in the composite tape
of transactions on such exchange. If there is no reported sale of Common
Stock on such exchange on the
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date in question, then the fair market value shall be the closing
selling price on the exchange on the last preceding date for which such
quotation exists.
(iii) If the Common Stock at the time is neither listed
nor admitted to trading on any stock exchange nor traded in the
over-the-counter market, then the fair market shall be the most current
value per share determined in good faith by the TriZetto Board of
Directors.
(e) In the event the Debtor desires to sell any of the Shares,
(in which event, pursuant to the Note all of the gross proceeds shall be payable
to the Secured Party) the Secured Party shall cooperate with the Debtor to
deliver such Shares to a broker of the Debtor with instructions from the Debtor
to sell such Shares and to deliver the gross proceeds thereof (before deduction
of any commissions or other costs of sale) to the Secured Party as payment on
the Note.
7. EVENTS OF DEFAULT. The occurrence of one or more of the following
events shall constitute an event of default under this Agreement:
(a) the failure of the Debtor to pay the principal and accrued
interest when due under the Note and the continuation of such default for more
than 30 days;
(b) the occurrence of any acceleration event specified in the
Note;
(c) the failure of the Debtor to perform a material obligation
imposed upon the Debtor by reason of this Agreement and the failure to cure such
default within 60 days of written notice by Secured Party to the Debtor; or
(d) the breach of any warranty of the Debtor contained in this
Agreement.
Upon the occurrence of any such event of default, Secured Party may, at
its election, declare the Note and all other indebtedness secured hereunder to
become immediately due and payable and may exercise any or all of the rights and
remedies granted to a secured party under the provisions of the California
Uniform Commercial Code (as now or hereafter in effect), including (without
limitation) the power to dispose of the Collateral by public or private sale or
to accept the Collateral in full payment of the Note and all other indebtedness
secured hereunder. Anything herein to the contrary notwithstanding, Secured
Party acknowledges that because the Note is non-recourse, its sole remedy is to
pursue its rights to foreclose and dispose of the Collateral pursuant to the
applicable provisions of the California Uniform Commercial Code.
Any proceeds realized from the disposition of the Collateral pursuant to
the foregoing power of sale shall be applied first to the payment of reasonable
expenses incurred by Secured Party in connection with the disposition and then
to the payment of the Note and finally to any other indebtedness secured
hereunder. Any surplus proceeds shall be paid over to the Debtor.
8. NO OTHER REMEDIES. The rights, powers and remedies granted to Secured
Party and the Debtor pursuant to the provisions of this Agreement shall be
exclusive. Any forbearance, failure or delay by Secured Party or the Debtor in
exercising any right, power or remedy under this Agreement shall not be deemed
to be a waiver of such right, power or remedy. Any single or partial exercise of
any right, power or remedy under this Agreement shall not preclude the further
exercise thereof, and every right, power and remedy of Secured Party and the
Debtor under this Agreement
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shall continue in full force and effect unless such right power or remedy is
specifically waived by an instrument executed by Secured Party or the Debtor, as
the case may be.
9. TRANSFER OF COLLATERAL. In connection with the transfer or assignment
of the Note (whether by renegotiation, discount or otherwise), Secured Party may
transfer all or any part of the Collateral, and the transferee shall thereupon
succeed to all rights, powers and remedies granted hereunder with respect to the
Collateral so transferred. Upon such transfer, Secured Party shall be fully
discharged from all liability and responsibility for the transferred Collateral.
10. COSTS AND EXPENSES. All reasonable costs and expenses (including
reasonable attorneys' fees) incurred by Secured Party in the exercise or
enforcement of any right, power or remedy granted it under this Agreement shall
become part of the indebtedness secured hereunder and shall bear interest until
paid at the per annum rate equal to the minimum per annum rate, compounded
annually, required to avoid the imputation of interest income to Secured Party
and compensation income to the Debtor under the federal tax laws.
11. APPLICABLE LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of California and shall be binding upon
the executors, administrators, heirs and assigns of the Debtor.
12. SEVERABILITY. If any provision of this Agreement is held to be
invalid under applicable law, then such provision shall be ineffective only to
the extent of such invalidity, and neither the remainder of such provision nor
any other provisions of this Agreement shall be affected thereby.
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IN WITNESS WHEREOF, this Stock Pledge Agreement has been executed by the
Debtor as of November 29, 1999.
DEBTOR
Address:
By:
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Agreed to and Accepted by:
XXXXXXX CORPORATION, as Secured Party
By:
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Its:
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