PLEDGE AGREEMENT
Exhibit 10.3
Execution Version
This PLEDGE AGREEMENT (this “Agreement”), dated as of May 18, 2011, is among MoneyGram
International, Inc., a Delaware corporation (“Holdco”), MoneyGram Payment Systems
Worldwide, Inc., a Delaware corporation (the “Borrower”), MoneyGram Payment Systems, Inc.,
a Delaware corporation (“Payment Systems”), MoneyGram of New York LLC, a Delaware limited
liability company (“MGI NY”; Holdco, the Borrower, Payment Systems, MGI NY and each Person
who becomes a party to this Agreement by execution of a joinder in the form of Exhibit C hereto,
are sometimes collectively referred to herein as “Pledgors” and each, individually, as a
“Pledgor”), and Bank of America, N.A., as Collateral Agent for the benefit of the Secured
Parties (the “Collateral Agent”).
W I T N E S S E T H:
WHEREAS, pursuant to that certain Credit Agreement dated as of the date hereof by and among
Holdco, the Borrower, Bank of America, N.A., as administrative agent (in such capacity, the
“Administrative Agent”) and the financial institutions so designated on the Commitment
Schedule (the “Lenders”) (the same, as it may be amended, restated, modified or
supplemented and in effect from time to time, being herein referred to as the “Credit
Agreement”), the Lenders have agreed to make available to the Borrower certain credit
facilities on the terms and conditions set forth therein;
WHEREAS, one or more Pledgors may from time to time on or after the date hereof enter into, or
guaranty the obligations of one or more other Pledgors or any of their respective Subsidiaries in
connection with, one or more Rate Management Transactions or Cash Management Agreements permitted
by the Credit Agreement with a Hedge Bank or a Cash Management Bank, as applicable;
WHEREAS, each of the Pledgors has benefited or will benefit directly and indirectly from the
credit facilities made available pursuant to the Credit Agreement and from the entering into by
Pledgors of Rate Management Transactions with Hedge Banks and Cash Management Agreements with Cash
Management Banks, and each Pledgor other than the Borrower has entered into that certain Guaranty
dated as of the date hereof with respect to the Credit Agreement; and
WHEREAS, to induce the Administrative Agent and the Lenders to enter into the Credit Agreement
and make available the credit facilities thereunder and to induce the Lenders and their Affiliates
to enter into Rate Management Transactions and Cash Management Agreements, the Pledgors have agreed
to enter this Agreement on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
Section 1. Definitions. Unless otherwise defined herein, all capitalized terms used
herein shall have the respective meanings ascribed thereto in the Credit Agreement. All terms
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defined in the Uniform Commercial Code, as in effect in the State of New York from time to
time (the “UCC”), which are not otherwise defined in this Agreement or in the Credit
Agreement are used in this Agreement as defined in the UCC as in effect on the date hereof. In
addition, as used herein:
“Cash Management Bank” means any Person that, at the time it enters into a Cash
Management Agreement (as defined in the Credit Agreement), is a Lender or an Affiliate of a
Lender, in its capacity as a party to such Cash Management Agreement.
“Event of Default” means a Default (as defined in the Credit Agreement).
“Excluded Shares” means any Capital Stock of any Foreign Subsidiary in excess
of 65% of such Capital Stock of such Foreign Subsidiary.
“Foreign Issuer” means each of Borrower’s material first-tier Foreign
Subsidiaries.
“Hedge Bank” means any Person that (i) at the time it enters into Rate
Management Transaction (as defined in the Credit Agreement) with Holdco or any Holdco
Subsidiary, is a Lender or an Affiliate of a Lender and (ii) is a party to the Rate
Management Transactions listed on Schedule 1 to the Credit Agreement and specified on such
Schedule as a “Hedge Bank” (or any of such Person’s Affiliates), in each case as a party to
such Rate Management Transaction.
“Issuer” means Borrower, each of Borrower’s Material Domestic Subsidiaries
(other than Property Bridge) and each Foreign Issuer.
“Obligations” means all unpaid principal of and accrued and unpaid interest on
the Loans, all LC Exposure, all accrued and unpaid fees and all expenses, reimbursements,
indemnities and other obligations of the Loan Parties to the Lenders or to any Lender, the
Administrative Agent, the Collateral Agent, the LC Issuer or any indemnified party arising
under the Loan Documents, including without limitation all obligations of the Loan Parties
under the Guaranty and all joinders and supplements thereto.
“Pledged Collateral” shall have the meaning ascribed thereto in Section
2 below.
“Pledged Shares” shall have the meaning ascribed thereto in Section 2
below.
“Proceeds” means “proceeds”, as such term is defined in the UCC and, in any
event, includes, without limitation, (a) any and all proceeds of any insurance, indemnity,
warranty or guaranty payable with respect to any of the Pledged Collateral, (b) any and all
payments (in any form whatsoever) made or due and payable from time to time in connection
with any requisition, confiscation, condemnation, seizure or forfeiture of all or any part
of the Pledged Collateral by any governmental body, authority, bureau or agency (or any
person acting under color of Governmental Entity), (c) all Stock Rights and (d) any and all
other amounts from time to time paid or payable under, in respect of
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or in connection with any of the Pledged Collateral other than Excluded Assets (as
defined in the Security Agreement).
“Representative” means any Person acting as agent, representative or trustee on
behalf of the Collateral Agent from time to time.
“Required Secured Parties” means (a) prior to the date upon which the Credit
Agreement has terminated by its terms and all of the Obligations have been paid in full, the
Required Lenders (or if so required by Section 8.02 of the Credit Agreement, all the
Lenders) and (b) after the Credit Agreement has terminated by its terms and all of the
Obligations have been paid in full, Secured Parties holding in the aggregate at least a
majority of the aggregate due and unpaid Secured Hedge Obligations and Secured Cash
Management Obligations, as determined by the Collateral Agent in its reasonable discretion.
“Secured Parties” means, collectively, each Lender, the Hedge Banks, the Cash
Management Banks, the LC Issuer, the Administrative Agent, the Collateral Agent and all of
their successors and assigns.
“Secured Obligations” means, collectively, the Obligations, the Secured Cash
Management Obligations and the Secured Hedge Obligations.
“Security Agreement” means that certain Security Agreement dated as of the date
hereof among the Collateral Agent, Holdco and certain of its Subsidiaries, as from time to
time amended, restated, amended and restated, modified or supplemented.
“Significant Acquired Subsidiary” means any Subsidiary of Holdco that on the
date such Subsidiary is acquired, incorporated or formed (or in respect of a newly
incorporated or formed Subsidiary, that acquires assets as part of one or more related
transactions immediately thereafter) has total assets that exceed 10% of the consolidated
total assets of the Borrower and its Subsidiaries or has total revenues for the most recent
12 month period, if applicable, on a pro forma basis that exceed 10% of the total
consolidated revenues for the most recent 12 month period of the Borrower and its
Subsidiaries.
“Stock Rights” means all dividends, instruments or other distributions and any
stocks, shares, warrants, options or other securities rights or any other right or property
which the Pledgors shall receive or shall become entitled to by way of dividend bonus,
redemption, exchange, purchase, substitution, conversion, consolidation, subdivision,
preference or otherwise to receive for any reason whatsoever with respect to, in
substitution for or in exchange for, any Pledged Shares.
“Termination Date” means the first date on which (a) the Credit Agreement is
terminated, (b) the Obligations (other than contingent indemnification obligations) have
been fully and completely performed and indefeasibly satisfied, (c) the Commitments have
terminated, (d) each Rate Management Transaction with any Hedge Bank shall have terminated
or expired or, with respect to any such Rate Management Transaction with any Hedge Bank that
remains in effect, the applicable Loan Party has provided to such
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Hedge Bank collateral support of a kind and in an amount that is consistent with
prevailing market terms for an exposure comparable to the exposure of such counterparty
under such Rate Management Transaction and reasonably acceptable to such Hedge Bank, and (e)
all Secured Cash Management Obligations then due and payable have been paid in full.
Section 2. Pledge.
(a) As collateral security for the prompt payment in full when due (whether at stated
maturity, by acceleration or otherwise) of the Secured Obligations, as of the Effective Date
each Pledgor hereby grants, pledges, assigns, hypothecates, transfers, delivers and grants
to the Collateral Agent, for the benefit of the Secured Parties, a first Lien on and first
security interest in (i) to the extent the same do not constitute Excluded Shares, all of
the Capital Stock of the Issuers now owned or hereafter acquired by such Pledgor
(collectively, the “Pledged Shares”; when used with respect to any one Pledgor,
“Pledged Shares” means the Pledged Shares in which such Pledgor has an interest),
(ii) subject to Section 5, any Stock Rights, (iii) the certificates, if any, representing
all such Pledged Shares and Stock Rights and (iv) all Proceeds of the collateral described
in the preceding clauses (i), (ii) and (iii) (the collateral described in clauses (i)
through (iv) of this Section 2 being collectively referred to as the “Pledged
Collateral”). Notwithstanding the foregoing, the Pledged Collateral shall not be deemed
to include (a) any General Intangibles or other rights arising under contracts, Instruments,
licenses, license agreements or other documents, to the extent (and only to the extent) that
the grant of a security interest would (i) be prohibited by an enforceable anti-assignment
provision of such documents in favor of a third party on such grant, unless and until any
required consents shall have been obtained, (ii) give any other party to such contract,
Instrument, license, license agreement or other document the right to terminate its
obligations thereunder, or (iii) violate any law, provided, however, that (1) any portion of
any such General Intangible or other such right pursuant to this clause (a) shall constitute
Pledged Collateral at the time and to the extent that the grant of a security interest
therein does not result in any of the consequences specified in subclauses (i) through (iii)
above and (2) the limitation set forth in this clause (a) above shall not affect, limit,
restrict or impair the grant by a Pledgor of a security interest pursuant to this Agreement
in any such General Intangible or other such right, to the extent that an otherwise
applicable prohibition or restriction on such grant is rendered ineffective by any
applicable law, including the UCC; (b) any property as to which the Collateral Agent and the
Borrower reasonably determine (as specified in writing by such Persons) that the costs of
obtaining a security interest (or perfecting the same) outweighs the benefit to the Secured
Parties of the security afforded thereby; (c) any other assets that require perfection
exclusively through control agreements under the applicable UCC; or (d) any direct Proceeds,
substitutions or replacements of any of the foregoing, but only to the extent such Proceeds,
substitutions or replacements would otherwise constitute any of the items described in
clauses (a) through (c) above.
(b) All of the Pledged Shares now owned by each Pledgor which are presently represented
by stock certificates are listed on Exhibit A hereto, which stock certificates, with
undated stock powers duly executed in blank by such Pledgor and irrevocable
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proxies, have previously been or are simultaneously herewith being delivered to the
Collateral Agent, for the benefit of the Secured Parties.
Section 3. Representations and Warranties of Pledgors. Each Pledgor represents and
warrants to, and covenants with, the Collateral Agent, for the benefit of the Secured Parties, as
follows:
(a) such Pledgor is the record and beneficial owner of, and has legal title to, the
Pledged Shares which are listed on Exhibit A, and such shares are free and clear of
all Liens whatsoever, except for Permitted Liens;
(b) such Pledgor has the power, authority and legal right to execute this Agreement and
to pledge the Pledged Shares and any additional Pledged Collateral to the Collateral Agent,
for the benefit of the Secured Parties;
(c) this Agreement has been duly authorized, executed and delivered by such Pledgor and
constitutes a legal, valid and binding obligation of such Pledgor enforceable in accordance
with its terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium, reorganization and other similar laws affecting the enforcement of
creditors’ rights generally or by general equitable principles;
(d) there are no outstanding options, warrants or other agreements with respect to the
Pledged Shares;
(e) the Pledged Shares have been duly and validly authorized and issued, and are or
will be fully paid and non-assessable. The Pledged Shares listed on Exhibit A
constitute the percentage of the issued and outstanding Capital Stock of such class of the
Issuers specified on Exhibit A;
(f) no consent, approval or authorization of or designation or filing with any
Governmental Entity on the part of such Pledgor is required in connection with or as a
condition to the pledge and security interest granted under this Agreement, or the exercise
by the Collateral Agent of the voting and other rights provided for in this Agreement except
as may be required in connection with disposition of the Pledged Collateral by laws
affecting the offering and sale of securities generally;
(g) the execution, delivery and performance of this Agreement by such Pledgor will not
violate any provision of (i) any applicable law, rule, regulation, order, judgment, writ,
award or decree binding on such Pledgor, (ii) the charter or by-laws or Memorandum of
Articles of Association of such Pledgor or any Issuer or of any securities issued by any
Issuer or (iii) any mortgage, indenture, lease, contract, or other agreement, instrument or
undertaking to which such Pledgor or any Issuer is a party or to which such Pledgor or its
assets is bound, and will not result in the creation or imposition of any Lien in any of the
assets of such Pledgor or any Issuer except to the extent otherwise permitted by this
Agreement or the Credit Agreement and except with respect to clauses (i) or (iii), to the
extent, individually or in the aggregate, that such violation, conflict, breach, default or
creation or imposition of any Lien could not reasonably be expected to result in a Material
Adverse Effect;
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(h) the pledge, assignment and delivery to the Collateral Agent of the Pledged Shares
pursuant to this Agreement and the filing of UCC financing statements pursuant to the terms
of the Security Agreement create a valid first priority Lien on and a first perfected
security interest in the Pledged Shares and the Proceeds thereof, to the extent that such
Pledged Shares may be perfected by filing a financing statement under the UCC or by such
pledge, assignment and delivery, in favor of the Collateral Agent, for the benefit of the
Secured Parties, subject to no prior Lien. Such Pledgor covenants and agrees that it will
defend the Collateral Agent’s right, title and security interest in and to the Pledged
Shares and the Proceeds thereof against the claims and demands of all persons whomsoever;
(i) with respect to any certificates delivered to the Collateral Agent representing
Pledged Collateral, either such certificates are Securities as defined in Article 8 of the
UCC as a result of actions by the Issuer or otherwise, or, if such certificates are not
Securities, such Pledgor has so informed the Collateral Agent so that the Collateral Agent
may take steps to perfect its security interest therein as a General Intangible; and
(j) none of the Pledged Collateral owned by such Pledgor has been issued or transferred
in violation of the securities registration, securities disclosure or similar laws of any
jurisdiction to which such issuance or transfer may be subject, except to the extent,
individually or in the aggregate, that such issuance or transfer could not reasonably be
expected to result in a Material Adverse Effect.
Section 4. Covenants. If, prior to the Termination Date, any Pledgor shall receive
any certificate representing Pledged Shares (including, without limitation, any certificate
representing a stock dividend or a stock distribution in connection with any reclassification,
increase or reduction of capital, or issued in connection with any reorganization, merger or
consolidation), or any options or rights, whether as an addition to, in substitution for, or in
exchange for any of the Pledged Shares, or otherwise, such Pledgor agrees to accept the same as the
Collateral Agent’s agent and to hold the same in trust for the Collateral Agent, and such Pledgor
shall, on the earlier of (A) 30 days after the date written notice thereof has been given to such
Pledgor by the Collateral Agent but only with respect to certificates representing Capital Stock of
Significant Acquired Subsidiaries and (B) on or before the later of (i) 30 days following such
receipt or (ii) the first date required for delivery of financial statements pursuant to Section
6.01(a) or (b) of the Credit Agreement following such receipt (or such longer period as to which
the Collateral Agent may agree), or, if an Event of Default has occurred and is continuing, within
30 days following written notice thereof given by the Collateral Agent to such Pledgor, deliver the
same forthwith to the Collateral Agent in the exact form received, with the endorsement of such
Pledgor when necessary and/or appropriate undated stock powers duly executed in blank, to be held
by the Collateral Agent, for the benefit of the Secured Parties, subject to the terms hereof, as
additional Pledged Collateral. Upon the creation or acquisition by any Pledgor of any Capital
Stock in any other Issuer or any additional Pledged Shares of any Issuer, such Pledgor shall, on or
before the later of (i) 30 days following such creation or acquisition or (ii) the first date
required for delivery of financial statements pursuant to Section 6.01(a) or (b) of the Credit
Agreement following such creation or acquisition (or such longer period as to which the Collateral
Agent may agree), execute and deliver to the Collateral Agent an Addendum in the
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form of Exhibit B hereto (an “Addendum”); provided, that with respect
to any Foreign Issuer whose Capital Stock is uncertificated, the applicable Pledgor shall, to the
extent not prohibited by applicable law, cause to be issued one or more stock certificates
representing 65% of the issued Capital Stock of such Foreign Issuer, together with undated
instruments of transfer duly executed by such Pledgor to be delivered to the Collateral Agent
within such time period. The Collateral Agent, on behalf of the Secured Parties, shall maintain
possession and custody of any certificates delivered to it representing the Pledged Shares and any
additional Pledged Collateral. Without the prior written consent of the Collateral Agent each
Pledgor agrees that it shall not, and not otherwise permit any Issuer, to opt-in to Article 8 of
the UCC with respect to any uncertificated Pledged Collateral which will cause such Pledged
Collateral to become a “security” within the meaning of Section 8-102 of the UCC.
Section 5. Administration of Security.
(a) Each Pledgor shall be entitled (subject to the other provisions hereof, including,
without limitation, Section 8 below):
(i) until receipt of notice to the contrary from the Collateral Agent during the
continuance of an Event of Default, to vote or consent, or refrain from voting or
consenting, with respect to the Pledged Shares; provided however, that no vote or
other right shall be exercised or action taken by any Pledgor which would have the effect of
materially impairing the rights of the Collateral Agent in respect of such Pledged
Collateral; and
(ii) until receipt of notice to the contrary from the Collateral Agent delivered during
the continuance of an Event of Default, to receive cash dividends or other distributions in
the ordinary course made in respect of the Pledged Shares, to the extent payment is not
prohibited pursuant to the Credit Agreement.
(b) Upon the occurrence and continuance of an Event of Default, the Collateral Agent
may act as each Pledgor’s proxy and attorney-in-fact pursuant to the terms of Section
21 below, subject to the limitations set forth in the last sentence of this clause (b),
with respect to its Pledged Collateral, including the right to vote such Pledged Collateral,
with full power of substitution to do so, and the right to exercise all other rights,
powers, privileges and remedies to which a holder of such Pledged Collateral would be
entitled (including giving or withholding written consents of shareholders, calling special
meetings of shareholders and voting at such meetings). Such proxy shall be effective,
automatically and without the necessity of any action (including any transfer of any such
Pledged Collateral on the record books of the issuer thereof) by any person (including the
issuer of such Pledged Collateral or any officer or agent thereof), upon the occurrence and
continuation of an Event of Default.
(c) Upon the occurrence and during the continuance of an Event of Default, in the event
that any Pledgor, as record and beneficial owner of its Pledged Shares, shall have received
or shall have become entitled to receive, any cash dividends or other distributions on
account of the Pledged Shares in the ordinary course or pursuant to the recapitalization of
the capital of the Issuer thereof or pursuant to the reorganization
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thereof, such Pledgor shall, at the Collateral Agent’s written request, promptly
deliver such cash or other distributions to the Collateral Agent, for the benefit of the
Secured Parties, and the Collateral Agent, for the benefit of the Secured Parties, shall be
entitled to receive and retain, all such cash or other distributions as additional Pledged
Collateral.
Section 6. Reserved.
Section 7. Certain Rights of the Collateral Agent. Neither the Collateral Agent nor
any of the other Secured Parties shall be liable for failure to collect or realize upon any of the
Secured Obligations or any collateral security or guaranty therefor, or any part thereof, or for
any delay in so doing, nor shall the Collateral Agent or any of the other Secured Parties be under
any obligation to take any action whatsoever with regard thereto. Any or all of the Pledged Shares
held by the Collateral Agent hereunder may, if an Event of Default has occurred and is continuing,
be registered in the name of the Collateral Agent or its nominee and the Collateral Agent or its
nominee may thereafter (with prompt subsequent, but not prior, notice to the Pledgors) exercise all
voting and corporate rights at any meeting with respect to any Issuer and exercise any and all
rights of conversion, exchange, subscription or any other rights, privileges or options pertaining
to any of the Pledged Shares as if it were the absolute owner thereof, including, without
limitation, the right to vote in favor of, and to exchange at its discretion any and all of the
Pledged Shares upon, the merger, consolidation, reorganization, recapitalization or other
readjustment with respect to any Issuer or upon the exercise by any Pledgor or the Collateral Agent
of any right, privilege or option pertaining to any of the Pledged Shares, and in connection
therewith, to deposit and deliver any and all of the Pledged Shares with any depository, transfer
agent, registrar or other designated agency upon such terms and conditions as the Collateral Agent
may determine, all without liability except to account for property actually received by the
Collateral Agent.
Section 8. Remedies. Upon the occurrence and during the continuance of an Event of
Default, the Collateral Agent, without demand of performance or other demand, advertisement or
notice of any kind (except the notice specified below of time and place of public or private sale)
to or upon any Pledgor or any other person (all and each of which demands, advertisements and/or
notices are hereby expressly waived), may forthwith collect, receive, appropriate and realize upon
the Pledged Collateral, or any part thereof, and/or may forthwith sell, assign, give an option or
options to purchase, contract to sell or otherwise dispose of (including the disposition by merger)
and deliver said Pledged Collateral, or any part thereof, in one or more portions at public or
private sale or sales or transactions, at any exchange, broker’s board or at any of the Collateral
Agent’s offices or elsewhere upon such terms and conditions as the Collateral Agent may deem
commercially reasonable and at such prices as it may deem best, for any combination of cash and/or
securities or other property or on credit or for future delivery without assumption by any Secured
Party of any credit risk, with the right to the Collateral Agent upon any such sale or sales,
public or private, to purchase the whole or any part of said Pledged Collateral so sold, free of
any right or equity of redemption in any Pledgor, which right or equity is hereby expressly waived
or released. Each Pledgor agrees that the Collateral Agent need not give more than ten (10) days’
notice (but shall give at least ten (10) days’ notice) of the time and place of any public sale or
of the time after which a private sale or other intended disposition is to take place and that such
notice is reasonable notification of such matters. No notification need be given to any Pledgor if
such Pledgor has signed after the occurrence and during the
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continuance of an Event of Default a statement renouncing or modifying any right to
notification of sale or other intended disposition. In addition to the rights and remedies granted
to the Collateral Agent for the benefit of the Secured Parties in this Agreement and in any other
instrument or agreement securing, evidencing or relating to any of the Secured Obligations, the
Collateral Agent and the other Secured Parties shall have all the rights and remedies of a secured
party under the UCC and under any other applicable law.
Section 9. Sale of Pledged Shares.
(a) Each Pledgor recognizes that the Collateral Agent, on behalf of the Secured
Parties, may be unable to effect a public sale or disposition (including, without
limitation, any disposition in connection with a merger of any Subsidiary) of any or all the
Pledged Collateral by reason of certain prohibitions contained in the Securities Act of
1933, as amended (the “Act”), and applicable state securities laws, but may be
compelled to resort to one or more private sales or dispositions thereof to a restricted
group of purchasers who 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. Each Pledgor acknowledges and agrees that any such private sale or
disposition may result in prices and other terms (including the terms of any securities or
other property received in connection therewith) less favorable to the seller than if such
sale or disposition were a public sale or disposition and, notwithstanding such
circumstances, agrees that any such private sale or disposition shall be deemed to be
reasonable and affected in a commercially reasonable manner. The Collateral Agent shall be
under no obligation to delay a sale or disposition of any of the Pledged Collateral in order
to permit any Pledgor or any Issuer to register such securities for public sale under the
Act, or under applicable state securities laws, even if such Pledgor or any Issuer would
agree to do so. No Secured Party shall incur any liability as a result of the sale of any
such Pledged Collateral, or any part thereof, at any private sale provided for in this
Agreement conducted in a commercially reasonable manner, and each Pledgor hereby waives any
claims against the Secured Parties arising by reason of the fact that the price at which the
Pledged Collateral may have been sold at such a private sale was less than the price which
might have been obtained at a public sale or was less than the aggregate amount of the
Secured Obligations, even if, acting in a commercially reasonable manner, the Collateral
Agent accepts the first offer received and does not offer the Pledged Collateral to more
than one offeree.
(b) Upon the occurrence and during the continuance of an Event of Default, each Pledgor
agrees to do or cause to be done all such other acts and things as may be reasonably
necessary to make such sale or sales or dispositions of any portion or all of the Pledged
Collateral valid and binding and in compliance with any and all applicable laws,
regulations, orders, writs, injunctions, decrees or awards of any and all courts,
arbitrators or governmental instrumentalities, domestic or foreign, having jurisdiction over
any such sale or sales or dispositions, all at such Pledgor’s expense.
(c) Each Pledgor agrees to indemnify and hold harmless the Secured Parties, each of
their respective successors and assigns, officers, directors, employees, agents and
attorneys, and any Person in control of any thereof, from and against any loss, liability,
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claim, damage and expense (limited with respect to legal expenses to the reasonable
out-of-pocket fees, disbursements and other charges of one counsel to such indemnified
Persons taken as a whole and, if reasonably necessary, one local counsel in any relevant
jurisdiction) (collectively called the “Indemnified Liabilities”), under federal and
state securities laws or otherwise insofar as any such Indemnified Liability:
(i) arises out of or is based upon any Pledgors’ untrue statement or alleged untrue
statement of a material fact contained in any registration statement, prospectus or offering
memorandum or in any preliminary prospectus or preliminary offering memorandum or in any
amendment or supplement to any of the foregoing or in any other writing prepared in
connection with the offer, sale or resale of all or any portion of the Pledged Collateral
prior to the termination of this Agreement unless such untrue statement of material fact was
provided by the Collateral Agent specifically for inclusion therein; or
(ii) arises out of or is based upon any Pledgors’ omission or alleged omission to state
therein a material fact required to be stated or necessary to make the statements therein
not misleading;
such indemnification to remain operative regardless of any investigation made by or on behalf of
the Collateral Agent, any Secured Party or any successor thereof, or any Person in control of any
thereof. In connection with a public sale or other distribution, each Pledgor will provide
customary indemnification to any underwriters, their respective successors and assigns, their
respective officers and directors and each Person who controls any such underwriter (within the
meaning of the Act). If and to the extent that the foregoing undertakings in this Section
9(c) may be unenforceable for any reason, each Pledgor agrees to make maximum contribution to
the payment and satisfaction of each of the Indemnified Liabilities which is permissible under
applicable law. The obligations of each Pledgor under this Section 9(c) shall survive any
termination of this Agreement.
Section 10. Application of Proceeds. The proceeds of any collection, sale or other
realization of all or any part of the Pledged Collateral, and any other cash at the time held by
the Collateral Agent under this Agreement, shall, following an Event of Default, be applied in the
manner set forth in Section 2.24(b) of the Credit Agreement. Each Pledgor shall remain liable for
any deficiency remaining after such application.
Section 11. Further Assurances. Each Pledgor agrees that at any time and from time to
time, upon the written request of the Collateral Agent, such Pledgor will execute and deliver all
stock powers, financing statements, proxies and such further documents and do such further
reasonable acts and things as the Collateral Agent may reasonably request consistent with the
provisions hereof in order to effect the purposes of this Agreement. Without limiting the
foregoing, each Pledgor will take any and all actions reasonably required or requested by the
Collateral Agent, from time to time, to cause the Collateral Agent to obtain exclusive control of
any Pledged Collateral owned by such Pledgor in a manner reasonably acceptable to the Collateral
Agent. For purposes of this Section 11, the Collateral Agent shall have exclusive control
of Pledged Collateral if (i) in the case of Pledged Collateral consisting of certificated
securities, such Pledgor delivers such certificated securities to the Collateral Agent (with
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appropriate endorsements (in blank or otherwise) if such certificated securities are in
registered form) and (ii) in the case of any other Pledged Collateral, the Collateral Agent has
control thereof for all applicable purposes of the UCC.
Section 12. Limitation on Duty of the Collateral Agent.
(a) The powers conferred on the Collateral Agent under this Agreement are solely to
protect the Collateral Agent’s interest in the Pledged Collateral and shall not impose any
duty upon it to exercise any such powers. The Collateral Agent shall be accountable only
for amounts that it actually receives as a result of the exercise of such powers and neither
the Collateral Agent nor its Representative nor any of their respective officers, directors,
employees or agents shall be responsible to Pledgors for any act or failure to act, except
for bad faith, gross negligence, willful misconduct or breach of this Agreement. Without
limiting the foregoing, the Collateral Agent and any Representative shall be deemed to have
exercised reasonable care in the custody and preservation of the Pledged Collateral in their
possession if such Pledged Collateral is accorded treatment substantially equivalent to that
which the Collateral Agent or any Representative, in its individual capacity, accords its
own property consisting of the type of Pledged Collateral involved, it being understood and
agreed that neither the Collateral Agent nor any Representative shall have any
responsibility for taking any necessary steps (other than steps taken in accordance with the
standard of care set forth above) to protect, preserve or exercise rights against any Person
with respect to any Pledged Collateral and shall be relieved of all responsibility for the
Pledged Collateral upon surrendering it to the applicable Pledgor.
(b) Also without limiting the generality of the foregoing, neither the Collateral Agent
nor any Representative shall have any obligation or liability under any contract or license
by reason of or arising out of this Agreement or the granting to the Collateral Agent of a
security interest therein or assignment thereof or the receipt by the Collateral Agent or
any Representative of any payment relating to any contract or license pursuant hereto, nor
shall the Collateral Agent or any Representative be required or obligated in any manner to
perform or fulfill any of the obligations of any Pledgor under or pursuant to any contract
or license, or to make any payment, or to make any inquiry as to the nature or the
sufficiency of any payment received by it or the sufficiency of any performance by any party
under any contract or license, or to present or file any claim, or to take any action to
collect or enforce any performance or the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.
Section 13. Severability. If any provision hereof is invalid and unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (a) the other provisions hereof shall
remain in full force and effect in such jurisdiction and (b) the invalidity or unenforceability of
any provision hereof in any jurisdiction shall not affect the validity or enforceability of such
provision in any other jurisdiction.
Section 14. No Waiver; Cumulative Remedies. No failure on the part of the Collateral
Agent to exercise, and no course of dealing with respect to, and no delay in exercising, any right,
power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial
11
exercise by the Collateral Agent of any right, power or remedy hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or remedy. Neither the
Collateral Agent nor any of the other Secured Parties shall be liable for any failure to collect or
realize upon any of the Secured Obligations or any collateral security or guaranty therefor, or any
part thereof, or for any delay in so doing, nor shall the Collateral Agent or any of the other
Secured Parties be under any obligation to take any action whatsoever with regard thereto. The
rights and remedies herein provided are cumulative and may be exercised singly or concurrently, and
are not exclusive of any rights or remedies provided by law.
Section 15. Specific Performance. Each Pledgor agrees that a breach of any of the
covenants contained in Sections 2(b), 4, 5(c), 9 or 11
hereof will cause irreparable injury to the Secured Parties, that the Secured Parties have no
adequate remedy at law in respect of such breach and, as a consequence, agrees that each and every
covenant referenced above shall be specifically enforceable against such Pledgor in an action for
specific performance.
Section 16. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto, the Secured Parties and the respective successors and assigns of
the foregoing, provided, that no Pledgor shall assign or transfer its rights hereunder
without the prior written consent of the Collateral Agent.
Section 17. Termination. This Agreement and the Liens granted hereunder shall
terminate upon the Termination Date, whereupon each Pledgor shall automatically be released from
its obligations hereunder (other than those expressly stated to survive such termination) and the
Collateral Agent shall forthwith cause to be assigned, transferred and delivered, against receipt
but without any recourse, warranty or representation whatsoever, any remaining Collateral
(including all certificates evidencing the Pledged Collateral in its possession or control) to or
on the order of the Pledgors. The Collateral Agent, at the Pledgors’ expense, shall also execute
and deliver to the Pledgors upon such termination such UCC termination statements and such other
documentation as shall be reasonably requested by the Pledgors to effect the termination and
release of the Liens in favor of the Collateral Agent created hereby.
Section 18. Possession of Pledged Collateral. Beyond the exercise of reasonable care
to assure the safe custody of the Pledged Collateral in the physical possession of the Collateral
Agent pursuant hereto, neither the Collateral Agent nor any nominee of the Collateral Agent shall
have any duty or liability to collect any sums due in respect thereof or to protect, preserve or
exercise any rights pertaining thereto, and shall be relieved of all responsibility for the Pledged
Collateral upon surrendering them to the applicable Pledgor.
Section 19. Survival of Representations and Warranties. All representations and
warranties of each Pledgor contained in this Agreement shall survive the execution and delivery of
this Agreement.
Section 20. Expenses. Any taxes (including income taxes) and stamp duties payable or
ruled payable by any domestic or foreign Governmental Entity in respect of this Agreement shall be
paid by the Pledgors, together with related interest, penalties, fines and expenses, if any. The
Pledgors shall reimburse the Collateral Agent promptly following demand for any and all reasonable
and documented costs and out-of-pocket expenses (limited with respect to legal
12
expenses to the reasonable fees, disbursements and other charges of one counsel to the
Collateral Agent and, if reasonably necessary, one local counsel in any relevant jurisdiction)
relating to this Agreement as and to the extent required by Section 9.06(a) of the Credit
Agreement. For purposes thereof, costs and expenses relating to the administration, collection,
preservation or sale of the Pledged Collateral shall be deemed to be in connection with the
administration of the Loan Documents. Any and all costs and expenses incurred by the Pledgors in
the performance of actions required pursuant to the terms hereof shall be borne solely by the
Pledgors.
Section 21. Attorney-In-Fact. Until the Termination Date, each Pledgor hereby
irrevocably appoints the Collateral Agent as such Pledgor’s attorney-in-fact, effective upon the
occurrence and during the continuance of an Event of Default, with full authority in the place and
stead of such Pledgor and in the name of such Pledgor or otherwise, from time to time in the
Collateral Agent’s discretion, to take any action and to execute any instrument that the Collateral
Agent deems reasonably necessary or advisable to accomplish the purposes of this Agreement,
including, without limitation, to receive, endorse and collect all instruments made payable to such
Pledgor representing any dividend, payment or other distribution in respect of the Pledged
Collateral or any part thereof and to give full discharge for the same, when and to the extent
permitted by this Agreement.
Section 22. Notices. All notices, demands and requests that any party is required or
elects to give to any other party shall be given in accordance with the provisions of Section 13.01
of the Credit Agreement, and if given (i) to the Collateral Agent, shall be given to it at
[•] or as otherwise specified by the Collateral Agent in writing, (ii) to a Pledgor other
than the Borrower, shall be given to it c/o the Borrower at the address specified in the Credit
Agreement and (iii) to the Borrower, shall be given to it at its address specified in the Credit
Agreement.
Section 23. Choice of Law, Submission to Jurisdiction, etc.
(a) This Agreement shall be construed in accordance with and governed by the laws of
the State of New York.
(b) Each Pledgor hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of the Supreme Court of the State of New York
sitting in New York County and of the United States District Court of the Southern District
of New York, and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement, or for recognition or enforcement of any judgment, and
each of the parties hereto hereby irrevocably and unconditionally agrees that 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.
(c) Each of the parties hereto hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which 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 in any court referred to in paragraph (b) of this Section. Each
13
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.
(d) Each party to this Agreement irrevocably consents to service of process in the
manner provided for notices in this Section 23. 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 24. 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 ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A)
CERTIFIES THAT NO REPRESENTATIVE, 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 25. Amendments, Etc. The terms of this Agreement may be waived, altered or
amended only by an instrument in writing duly executed by each Pledgor and the Collateral Agent
with (other than in the case of amendments hereof solely for the purpose of adding Pledged
Collateral as contemplated hereby) the concurrence or at the direction of the Required Secured
Parties. Any such amendment or waiver shall be binding upon the Collateral Agent and each Pledgor
and their respective successors and assigns.
Section 26. Counterparts; Headings. This Agreement may be authenticated in any number
of counterparts, all of which taken together shall constitute one and the same instrument and any
of the parties hereto may authenticate this Agreement by signing any such counterpart. This
Agreement may be authenticated by manual signature, facsimile or electronic means, all of which
shall be equally valid. The headings in this Agreement are for convenience of reference only and
shall not alter or otherwise affect the meaning hereof.
Section 27. Entire Agreement. This Agreement embodies the entire agreement and
understanding between the Pledgors and the Collateral Agent with respect to the subject matter
hereof and supersedes all prior oral and written agreements and understandings between any Pledgor
and the Collateral Agent relating to the subject matter hereof. This Agreement supplements the
other Loan Documents and nothing in this Agreement shall be deemed to limit or supersede the rights
granted to the Collateral Agent or the other Secured Parties in any other Loan Document. In the
event of any inconsistencies between the provisions of this Agreement and the provisions of the
Security Agreement relating to Pledged Collateral, the provisions of this Agreement relating to the
Pledged Collateral shall govern.
[Signature Page Follows]
14
IN WITNESS WHEREOF, the parties hereto have caused this Pledge Agreement to be duly executed
and delivered as of the day and year first above written.
| PLEDGORS: MONEYGRAM INTERNATIONAL, INC. |
||||
| By: | /s/ Xxxxx X. Xxxxxxx | |||
| Name: | Xxxxx X. Xxxxxxx | |||
| Title: | Executive Vice President and Chief Financial Officer |
|||
| MONEYGRAM PAYMENT SYSTEMS WORLDWIDE, INC. |
||||
| By: | /s/ Xxxxx X. Xxxxxxx | |||
| Name: | Xxxxx X. Xxxxxxx | |||
| Title: | Executive Vice President and Chief Financial Officer |
|||
| MONEYGRAM PAYMENT SYSTEMS, INC. |
||||
| By: | /s/ Xxxxx X. Xxxxxxx | |||
| Name: | Xxxxx X. Xxxxxxx | |||
| Title: | Executive Vice President and Chief Financial Officer |
|||
| MONEYGRAM OF NEW YORK LLC |
||||
| By: | /s/ Xxxxx X. Xxxxxxx | |||
| Name: | Xxxxx X. Xxxxxxx | |||
| Title: | Executive Vice President and Chief Financial Officer |
|||
[Signature Page to Pledge Agreement]
| COLLATERAL AGENT: BANK OF AMERICA, N.A., as Collateral Agent for the benefit of the Secured Parties |
||||
| By: | /s/ Xxxx Xxxx | |||
| Name: | Xxxx Xxxx | |||
| Title: | Managing Director | |||
[Signature Page to Pledge Agreement]
Exhibit A
to Pledge Agreement
to Pledge Agreement
| % of Issued | ||||||||||
| Certificate | No. | Class of | Shares of such | |||||||
| Pledgor | Issuer | No. | of Shares | Shares | Class of Issuer | |||||
| MoneyGram International, Inc. |
MoneyGram Payment Systems Worldwide, Inc. |
2 | 1 | Common | 100% | |||||
| MoneyGram Payment Systems Worldwide, Inc. |
MoneyGram Payment Systems, Inc. |
2 | 1 | Common | 100% | |||||
| MoneyGram Payment Systems, Inc. |
MoneyGram of New York LLC |
Uncertificated | N/A | N/A | 100% | |||||
| MoneyGram Payment Systems, Inc. |
MoneyGram International Holdings Limited (UK) |
3 | 65,000 | Ordinary | ||||||
| 65% | ||||||||||
| MoneyGram Payment Systems, Inc. |
MoneyGram International Holdings Limited (UK) |
5 | 65 | Ordinary | ||||||
The undersigned, being a Pledgor pursuant to that certain Pledge Agreement dated as of May 18,
2011 (the “Pledge Agreement”) in favor of Bank of America, N.A., as Collateral Agent (“the
Collateral Agent”), by executing this Addendum, hereby acknowledges that such Pledgor
legally and beneficially owns Capital Stock as set forth below of _____________, a __________
[corporation] (“Corporation”). Capitalized terms used but not defined herein have the
meanings given them in the Pledge Agreement. Such Pledgor hereby agrees and acknowledges that
Corporation is an Issuer pursuant to the Pledge Agreement and the Shares (as hereinafter defined)
shall be deemed Pledged Shares pursuant to the Pledge Agreement. Such Pledgor hereby represents
and warrants to the Collateral Agent and the other Secured Parties that (i) all of the Capital
Stock of Corporation now owned by such Pledgor (“Shares”), to the extent the same do not
constitute Excluded Shares, is presently represented by the stock certificates listed below, which
stock certificates, with undated stock powers duly executed in blank by such Pledgor, are being
delivered to the Collateral Agent, simultaneously herewith, and (ii) after giving effect to this
addendum, the representations and warranties set forth in Section 3 of the Pledge Agreement are
true, complete and correct as of the date hereof (except to the extent such representations and
warranties are stated to relate to an earlier date, in which case such representations and
warranties shall have been made on and as of such earlier date).
Pledged Shares
| % of Issued | ||||||||||
| Certificate | No. | Class of | Shares of | |||||||
| Pledgor | Issuer | No. | of Shares | Shares | Class | |||||
IN WITNESS WHEREOF, Pledgor has executed this Addendum this ____ day of ______________, 201__.
| PLEDGOR: |
||||
| By: | ||||
| Its: | ||||
Exhibit C
to Pledge Agreement
Joinder to Pledge Agreement
to Pledge Agreement
Joinder to Pledge Agreement
The undersigned, ________________, a ______ _________, as of the __ day of _____, 20__, hereby
joins in the execution of that certain Pledge Agreement dated as of May 18, 2011 (as the same may
be amended, restated, amended and restated, supplemented or otherwise modified and in effect from
time to time, the “Pledge Agreement”) among MoneyGram International, Inc., MoneyGram
Payment Systems Worldwide, Inc., MoneyGram Payment Systems, Inc., MoneyGram of New York, LLC and
each other Person that becomes a Pledgor thereunder after the date and pursuant to the terms
thereof, to and in favor of Bank of America, N.A., as the Collateral Agent. Capitalized terms used
but not defined herein have the meanings given them in the Pledge Agreement. By executing this
Joinder, the undersigned hereby agrees that it is a Pledgor thereunder and agrees to be bound by
all of the terms and provisions of the Pledge Agreement.
The undersigned represents and warrants to the Collateral Agent and the other Secured Parties that
the undersigned is the record and beneficial owner of, and has legal title to, the Capital Stock
set forth below.
, a
| By: | ||||
| Name: | ||||
| Title: | ||||
Pledged Shares
| % of Issued | ||||||||||
| Certificate | No. | Class of | Shares of | |||||||
| Pledgor | Issuer | No. | of Shares | Shares | Class | |||||
