PLEDGE AND SECURITY AGREEMENT
Exhibit
4.2
THIS
PLEDGE AND SECURITY AGREEMENT (this “Agreement”)
is
entered into as of June __, 2006 by and among CNL
REAL
ESTATE GROUP, INC., a
Florida
corporation (“XXXX”),
XXXXX
X.
XXXXXX, XX.,
a
resident of the State of Florida, XXXXXX
X.
XXXXXX,
a
resident of the State of Florida, C.
XXXXX
XXXXXXXXXX,
a
resident of the State of Florida, XXXXXX
X.
XXXXXXXXX
III, a
resident of the State of Florida, XXXX
X.
XXXXXXXX,
a
resident of the State of Florida, XXXXX
A.N. BLOOM,
a
resident of the State of Florida, and XXXXXX XXXXXXX, a resident of the State
of
Florida (each of the foregoing parties are referred to individually herein
as an
“Individual
Pledgor,”
and
collectively, “Pledgors”),
CNL
HOTELS & RESORTS, INC., a Maryland corporation (“CHR”),
and
CNL
HOTELS & RESORTS ACQUISITION, LLC,
a
Florida limited liability company (together with CHR and their successors and
assigns, “Secured
Parties”).
WHEREAS,
Secured Parties and Pledgors, among other parties, have entered into an Amended
and Restated Agreement and Plan of Merger, entered into as of April 3, 2006
(the
“Merger
Agreement”),
pursuant to which Pledgors have agreed, on a several basis, to indemnify Secured
Parties on the terms and conditions set forth in the Merger Agreement;
WHEREAS,
pursuant to Section 8.20 of the Merger Agreement, Pledgors are required to
execute and deliver this Agreement and to pledge and grant a continuing security
interest in the Collateral (as defined herein) as additional security for the
Secured Obligations (as defined herein); and
WHEREAS,
all capitalized terms used herein which are not herein defined shall have the
meanings ascribed to them in the Merger Agreement.
NOW,
THEREFORE, in consideration of the foregoing and of the mutual covenants and
agreements hereinafter set forth, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
| 1. |
DEFINITIONS
|
For
the
purposes of this Agreement:
(a) “Collateral”
means
(i) an aggregate of 750,000 common shares, $.01 par value per share, of CHR
owned by Pledgors (“Stock”)
in the
proportions set forth on Schedule A on the date hereof, (ii) any dividends
or distributions, distributions in property, returns of capital or other
distributions made on or with respect to any of the foregoing shares,
and
(iii) all proceeds of the foregoing.
(b) “Event
of Default”
means
(i) any failure by an Individual Pledgor to fully and punctually pay or perform
one or more of its obligations pursuant to Section 9.8 or Article 12 of the
Merger Agreement (collectively, the “Secured
Obligations”),
as
determined by at
least
a majority of all of CHR’s disinterested directors who are non-employee
directors,
regardless of whether either of the Secured Parties has exercised its rights
under Section 13.2 of the Merger Agreement, (ii) the unenforceability of Secured
Parties’ security interest in the Collateral with the priority set forth herein
for any reason whatsoever, or (iii) any breach by an Individual Pledgor of
any
of its obligations under this Agreement that is not cured within five (5)
business days after such Individual Pledgor’s receipt of Secured Parties’
written notice thereof.
| 2. |
PLEDGE
OF COLLATERAL
|
(a) As
additional security for the payment and performance by Pledgors of all of the
Secured Obligations and all of their obligations under this Agreement, each
Individual Pledgor hereby pledges, assigns and grants to Secured Parties a
first
priority security interest in all of its or his right, title and interest in
and
to the Collateral and the proceeds thereof (the “Pledge”).
(b) In
the
event the shares of Stock included in the Collateral are
certificated:
(i) simultaneously
with the execution and delivery of this Agreement, each Individual Pledgor
is
delivering to Secured Parties certificates representing the shares of Collateral
described in clause (i) of Section 1(a) and
according to the listing of shares of Collateral set forth in the attached
Schedule A, and will deliver to Secured Parties all certificates relating to
the
Collateral described in clause (ii) of Section 1(a) within five (5) days after
each Individual Pledgor’s acquisition thereof, all of which certificates shall
be registered in the name of the appropriate Individual Pledgor, duly endorsed
in blank or accompanied by stock powers duly executed by the appropriate
Individual Pledgor in blank, together with any documentary tax stamps and any
other documents necessary to cause Secured Parties to have a good, valid and
perfected first pledge of, lien on and security interest in the Collateral,
free
and clear of any mortgage, pledge, lien, security interest, hypothecation,
assignment, charge, right, encumbrance or restriction (individually,
“Encumbrance,”
and
collectively, “Encumbrances”),
but
subject to restrictions set forth in state and federal securities laws or
restrictions set forth in the Registration Rights Agreement and accompanying
Lock-Up Agreement executed in connection with the Closing (as defined in the
Merger Agreement). At any time following an Event of Default, any or all of
the
shares of the Collateral held by Secured Parties hereunder may, at the option
of
Secured Parties exercised in accordance with Sections 3(b) and
5(c),
be registered in the names of Secured Parties or in the name of their nominee;
and
(ii) Secured
Parties hereby confirm receipt of the certificates representing the Collateral
described in clause (i) of Section 1(a) and agree to hold such certificates
in
accordance with the terms of this Agreement.
(c) In
the
event the shares of Stock included in the Collateral are uncertificated, each
Individual Pledgor agrees to take such actions and execute, deliver and file
such instruments and documents, including without limitation, one or more
financing statements, as the Secured Parties may request to perfect the Secured
Parties’ interest in the Collateral pursuant to this Agreement.
| 3. |
RIGHTS
OF PLEDGORS WITH RESPECT TO THE
COLLATERAL
|
(a) So
long
as no Event of Default shall have occurred and be continuing:
(i) Each
Individual Pledgor shall be entitled to exercise any and all voting and/or
consensual rights and powers relating or pertaining to such Individual Pledgor’s
portion of the Collateral, subject to the terms hereof, including any and all
rights under the Registration Rights Agreement.
(ii) Each
Individual Pledgor shall be entitled to receive and retain cash dividends or
distributions payable on such Individual Pledgor’s portion of the Collateral;
provided,
however,
that
all other dividends or distributions (including, without limitation, stock
and
liquidating dividends or distributions), distributions in property, returns
of
capital and other distributions made on or in respect of the Collateral, whether
resulting from a subdivision, combination or reclassification of the outstanding
capital stock of CHR or received in exchange for the Collateral or any part
thereof or as a result of any merger, consolidation, acquisition or other
exchange of assets to which CHR may be a party or otherwise, and any and all
cash and other property received in exchange for or redemption of any of the
Collateral, shall be retained by Secured Parties, or, if delivered to Pledgors,
shall be held in trust for the benefit of Secured Parties and forthwith
delivered to Secured Parties within five (5) days of the acquisition thereof
and
shall be considered as part of the Collateral for all purposes of this
Agreement.
(iii) Secured
Parties shall execute and deliver (or cause to be executed and delivered) to
Pledgors all such proxies, powers of attorney, dividend or distribution orders,
and other instruments as Pledgors may reasonably request for the purpose of
enabling each Individual Pledgor to exercise its or his voting and/or consensual
rights and powers which such Individual Pledgor is entitled to exercise pursuant
to Section 3(a)(i) above and/or to receive the dividends or distributions which
such Individual Pledgor is authorized to receive and retain pursuant to Section
3(a)(ii), and each Individual Pledgor shall execute and deliver to Secured
Parties such instruments as may be required or may be requested by Secured
Parties to enable Secured Parties to receive and retain the dividends or
distributions, distributions in property, returns of capital and other
distributions it is authorized to receive and retain pursuant to Section
3(a)(ii).
(b) Upon
the
occurrence and during the continuance of an Event of Default, all rights of
each
Individual Pledgor to exercise the voting and/or consensual rights and powers
which such Individual Pledgor is entitled to exercise pursuant to Section
3(a)(i) and/or to receive the dividends or distributions which such Individual
Pledgor is authorized to receive and retain pursuant to Section
3(a)(ii) shall
cease, at the option of Secured Parties, on not less than one (1) day’s written
notice to Pledgors, and all such rights shall thereupon become vested in Secured
Parties, who shall have the sole and exclusive right and authority to exercise
such voting and/or consensual rights and powers and/or to receive and retain
such dividends or distributions. In such case, each Individual Pledgor shall
execute and deliver such documents as Secured Parties may request to enable
Secured Parties to exercise such rights and receive such dividends or
distributions. In addition, Secured Parties are hereby appointed the
attorney-in-fact of each Individual Pledgor, with full power of substitution,
which appointment as attorney-in-fact is irrevocable and coupled with an
interest, to take all such actions after the occurrence and during the
continuance of an Event of Default, whether in the name of Secured Parties
or an
Individual Pledgor, as Secured Parties may consider necessary or desirable for
the purpose of exercising such rights and receiving such dividends or
distributions. Any and all money and other property paid over to or received
by
Secured Parties pursuant to the provisions of this Section 3(b) shall be
retained by Secured Parties as part of the Collateral and shall be applied
in
accordance with the provisions hereof.
(c) In
the
event the shares of Stock included in the Collateral are uncertificated or
are
not delivered to Secured Parties pursuant to Section 2(b)(i), the shares of
Stock included in the Collateral shall be segregated in CHR’s share register
from other common shares, $.01 par value per share, of CHR owned by an
Individual Pledgor, and the registration of such shares of Stock in CHR’s share
register shall include, and each Individual Pledgor hereby instructs CHR to
so
include, an annotation of the letters “PL” until the Collateral is returned to
Pledgors pursuant to this Agreement, provided that the Secured Parties’ security
interests in the Collateral created pursuant to this Agreement and the
continuation of such security interest shall not be impaired or otherwise
adversely affected in the event CHR’s transfer agent does not so annotate or
segregate (or continue to annotate or segregate) the shares of Stock included
in
the Collateral following CHR’s written request therefor.
| 4. |
SUBSTITUTION
OF COLLATERAL
|
Provided
that no Event of Default shall then have occurred and be continuing, any
Individual Pledgor may at any time propose that Secured Parties accept
substitute collateral and/or credit support (e.g.,
an
irrevocable standby letter of credit) in lieu of any of such Individual
Pledgor’s portion of the Collateral as may be specified in writing by such
Individual Pledgor. If, in the sole judgment of Secured Parties, such proposed
substitute collateral or credit support (hereinafter referred to as
“Replacement
Assurances”)
is
satisfactory in form and comfort to Secured Parties and affords Secured Parties
protection at least equivalent to the protection afforded by such Individual
Pledgor’s portion of the Collateral, then the Individual Pledgor and Secured
Parties shall cooperate, at the Individual Pledgor’s sole cost and expense, to
effect the substitution of such Replacement Assurances for such Individual
Pledgor’s portion of the Collateral, including (i) the preparation, execution,
delivery and filing of such agreements and other documents as may be requested
by Secured Parties in order to create and perfect in favor of Secured Parties
a
perfected first-priority security interest in the proposed substitute collateral
and/or to establish Secured Parties’ recourse to the proposed credit support,
and (ii) execution and delivery of such documents as may be necessary to release
the Secured Parties’ security interest in such Collateral.
| 5. |
REMEDIES
OF DEFAULT
|
(a) If
at any
time an Event of Default shall have occurred and be continuing, then, in
addition to having the right to exercise any right or remedy of a secured party
upon default under the Uniform Commercial Code as then in effect in the
jurisdiction in which the Collateral is held by Secured Parties and the right
to
exercise any right or remedy of Secured Parties under the Merger Agreement
or
otherwise, Secured Parties shall, to the extent permitted by law, without being
required to give any notice to Pledgors except as provided below:
(i) Apply
any
cash held by them hereunder in the manner provided in Section 5(g);
(ii) If
there
shall be no such cash or if the cash so applied shall be insufficient to pay
in
full the items specified in Sections 5(g)(i) and (ii), collect, receive,
appropriate and realize upon the Collateral or any part thereof, and/or sell,
assign, contract to sell or otherwise dispose of and deliver the Collateral
or
any part thereof, in its entirety or in portions, at public or private sale
or
at any broker’s board, on any securities exchange or at any of Secured Parties’
places of business or elsewhere, for cash, upon credit or for future delivery,
and at such price or prices as Secured Parties may deem best, and Secured
Parties may (except as otherwise provided by law) be the purchaser of any or
all
of the Collateral so sold and thereafter may hold the same, absolutely, free
from any right or claim of whatsoever kind, but shall in each case be subject
to
the terms and conditions of the Lock-Up Agreement; and
(iii) Upon
the
occurrence of an Event of Default, Secured Parties or their nominee shall have
the right, upon not less than one (1) day’s notice to Pledgors, to exercise any
and all rights of conversion, exchange, subscription or any other rights,
privileges or options pertaining to any shares of the Collateral as if it were
the absolute owner thereof, including, without limitation, the right to
exchange, at their discretion, any or all of the Collateral upon the merger,
consolidation, reorganization, recapitalization or other readjustment of CHR,
or
upon the exercise by CHR of any right, privilege or option pertaining to any
such shares of the Collateral, and, in connection therewith, to deposit and
deliver any and all of the Collateral with any committee, depository, transfer
agent, registrar or other designated agency upon such terms and conditions
as
Secured Parties may determine.
(b) In
the
event of a sale as aforesaid, Secured Parties are authorized to, at any such
sale, if they deem it advisable to do so, restrict the number of prospective
bidders or purchasers and/or further restrict such prospective bidders or
purchasers to persons who will represent and agree that they meet such
suitability standards as Secured Parties may deem appropriate, are purchasing
for their own account, for investment, and not with a view to the distribution
or resale of the Collateral, and may otherwise require that such sale be
conducted subject to restrictions as to such other matters as Secured Parties
may deem necessary in order that such sale may be effected in such manner as
to
comply with all applicable state and federal securities laws. Upon any such
sale, Secured Parties shall have the right to deliver, assign and transfer
to
the purchaser thereof the Collateral so sold.
(c) Notwithstanding
anything to the contrary contained herein, in the event Secured Parties exercise
any of their remedies hereunder against any portion of the Collateral
representing less than all of the Collateral, Secured Parties agree to do so
on
a pro-rata basis according to each Individual Pledgor’s proportionate share of
the Collateral.
(d) (i) Pledgors
hereby acknowledge that, notwithstanding that a higher price might be obtained
for the Collateral at a public sale than at a private sale or sales, the making
of a public sale of the Collateral may be subject to registration requirements
under applicable securities laws and similar other legal restrictions,
compliance with which would require such actions on the part of Pledgors, would
entail such expenses, and would subject Secured Parties, any underwriter through
whom the Collateral may be sold and any controlling person of any of the
foregoing to such liabilities, as would make a public sale of the Collateral
impractical or inadvisable. Accordingly, Pledgors hereby agree that private
sales made by Secured Parties in good faith in accordance with the provisions
of
Sections 5(a) or (b) may
be at
prices and on other terms less favorable to the seller than if the Collateral
were sold at public sale, and that Secured Parties shall not have any obligation
to take any steps in order to permit the Collateral to be sold at public sale,
a
private sale being considered or deemed to be a sale in a commercially
reasonable manner.
(ii) Each
purchaser at any such sale shall hold the property sold, absolutely, free from
any claim or right of whatsoever kind, including any equity or right of
redemption of any Individual Pledgor, each of whom hereby specifically waives
all rights of redemption, stay or appraisal which any Individual Pledgor has
or
may have under any rule of law or statute now existing or hereafter adopted.
Secured Parties shall give Pledgors not less than five (5) days’ written notice
of its intention to make any such public or private sale. Such notice, in case
of a public sale, shall state the time and place fixed for such sale, and,
in
case of a sale at broker’s board, on a securities exchange, at one or more of
Secured Parties’ places of business or elsewhere, shall state the board,
exchange or other location at which such sale is to be made and the day on
which
the Collateral, or that portion thereof so being sold, will first be offered
for
sale at such location. Such notice, in case of a private sale, shall state
only
the date on or after which such sale may be made. Any such notice given as
aforesaid shall be deemed to be reasonable notification. Notwithstanding the
above, all sales of the Collateral shall be subject to applicable state and
federal securities laws.
(iii) Any
such
public sale shall be held at such time or times within ordinary business hours
and at such place or places as Secured Parties may fix in the notice of such
sale. At any sale the Collateral may be sold in one lot as an entirety or in
parts, as Secured Parties may determine, but in all cases subject to Section
5(c). Secured Parties shall not be obligated to make any sale pursuant to any
such notice. Secured Parties may, without notice or publication, adjourn any
sale or cause the same to be adjourned from time to time by announcement at
the
time and place fixed for the sale, and such sale may be made at any time or
place to which the same may be so adjourned. In case of any sale of all or
any
part of the Collateral on credit or for future delivery, the Collateral so
sold
may be retained by Secured Parties until the selling price is paid by the
purchaser thereof, but Secured Parties shall not incur any liability in case
of
the failure of such purchaser to take up and pay for the Collateral so sold
and,
in case of any such failure, such Collateral may again be sold upon like
notice.
(iv) On
any
sale of the Collateral, Secured Parties are hereby authorized to comply with
any
limitation or restriction in connection with such sale that it may be advised
by
counsel is necessary in order to avoid any violation of applicable law or in
order to obtain any required approval of the purchaser or purchasers by any
governmental regulatory authority or officer or court.
(v) Subject
to Section 5(c), it is expressly understood and agreed by Pledgors that Secured
Parties may proceed against all or any portion or portions of the Collateral
and
all other collateral securing the Secured Obligations in such order and at
such
time as Secured Parties, in their sole discretion, see fit, and Pledgors hereby
expressly waive any rights under the doctrine of marshalling of
assets.
(vi) Compliance
with the foregoing procedures shall result in such sale or disposition being
considered or deemed to have been made in a commercially reasonable
manner.
(e) Secured
Parties, instead of exercising the power of sale herein conferred upon them,
may
proceed by a suit or suits at law or in equity to foreclose their lien or
security interest arising from this Agreement and sell the Collateral, or any
portion thereof in a manner consistent with Section 5(c), under a judgment
or
decree of a court or courts of competent jurisdiction.
(f) Each
of
the rights, powers, and remedies provided herein or now or hereafter existing
at
law or in equity or by statute or otherwise shall be cumulative and concurrent
and shall be in addition to every other right, power or remedy provided for
herein or therein or now or hereafter existing at law or in equity or by statute
or otherwise. The exercise of any such right, power or remedy shall not preclude
the simultaneous or later exercise of any or all other such rights, powers
or
remedies, including under the Merger Agreement, except there shall be no
duplication of recovery. No notice to or demand on Pledgors in any case shall
entitle Pledgors to any other notice or demand in similar or other
circumstances.
(g) The
proceeds of any collection, recovery, receipt, appropriation, realization or
sale as aforesaid shall be applied by Secured Parties in the following
order:
(i) First,
to
the payment of all costs and expenses of every kind incurred by Secured Parties
in connection therewith or incidental to the care, safekeeping or otherwise
of
any of the Collateral, including, without limitation, reasonable attorneys’ fees
and expenses;
(ii) Second,
to the payment of all other Secured Obligations; and
(iii) Finally,
to the payment to Pledgors of any surplus then remaining from such proceeds
unless otherwise required by law or directed by a court of competent
jurisdiction. The payment of any such surplus to Pledgors shall be made in
proportion to each Individual Pledgor’s share of the Collateral.
| 6. |
REPRESENTATIONS,
WARRANTIES AND COVENANTS OF
PLEDGORS
|
(a) Each
Individual Pledgor, severally, but not jointly, represents, warrants and
covenants that:
(i)
XXXX
is a
corporation duly incorporated, validly existing and in good standing under
the
laws of the State of Florida and has the full legal power and authority to
own
the Collateral.
(ii)
Each
Individual Pledgor has all requisite capacity, power and authority, being under
no legal restriction, limitation or disability, to own the Collateral.
(iii) Each
Individual Pledgor has full power and authority to execute and deliver this
Agreement and to perform its or his obligations hereunder. The execution, and
delivery of this Agreement has been duly and validly authorized by the Board
of
Directors of XXXX. No other corporate proceedings on the part of XXXX are
necessary to authorize the consummation of the transactions contemplated hereby
on behalf of XXXX. This Agreement has been duly and validly executed and
delivered by each Individual Pledgor and constitutes the valid and legally
binding obligation of each Individual Pledgor, enforceable against each
Individual Pledgor in accordance with its terms and conditions. No consents,
approvals, orders or authorizations of, or registration, declaration or filing
with, any government or governmental agency is required by or with respect
to
any Individual Pledgor in connection with the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby.
(iv) Each
Individual Pledgor is or, with respect to the Collateral described in clause
(ii) of Section 1(a), not later than the time of each Individual Pledgor’s
acquisition thereof will be, the direct record and beneficial owner of each
share of the Individual Pledgor’s portion of the Collateral. Each Individual
Pledgor has and will have good, valid and marketable title thereto, free and
clear of all Encumbrances other than the security interest created by this
Agreement.
(v) The
Collateral is and will be duly and validly pledged to Secured Parties in
accordance with law, and Secured Parties have a good, valid, and perfected
first
lien on and security interest in the Collateral and the proceeds
thereof.
(vi) Neither
the execution and the delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, by Pledgors, will (A) violate any
constitution, statute, regulation, rule, injunction, judgment, order, decree,
ruling, charge, or other restriction of any government, governmental agency,
or
court to which any Individual Pledgor is subject or any provision of its
articles of incorporation, certificate of formation, by-laws, limited liability
company agreement or other organizational documents, as applicable, or (B)
result in a breach of, constitute a default under, result in the acceleration
of, create in any person the right to accelerate, terminate, modify, or cancel,
or require any notice under any agreement, contract, lease, license, instrument,
or other arrangement to which any Individual Pledgor is a party or by which
it
or he is bound or to which any of its or his assets is subject.
(vii) There
is
no action, claim, suit, proceeding or investigation pending, or to the knowledge
of Pledgors, threatened or reasonably anticipated, against or affecting any
Individual Pledgor, this Agreement, or the transactions contemplated hereby,
before or by any court, arbitrator or governmental authority which might
adversely affect any Individual Pledgor’s ability to perform its obligations
under this Agreement or might adversely affect the value of the
Collateral.
(b) Until
all
Secured Obligations have been paid and performed in full or until all of the
Collateral is returned to Pledgors pursuant to Section 8 hereof, Pledgors
hereby covenant that, unless Secured Parties otherwise consent in advance in
writing:
(i) Each
Individual Pledgor shall (A) at the request of Secured Parties, execute,
deliver and file any and all financing statements, continuation statements,
stock powers, instruments, and other documents necessary or desirable, in
Secured Parties’ opinion, to create, perfect, preserve, validate or otherwise
protect the pledge of the Collateral to Secured Parties and Secured Parties’
lien on and security interest in the Collateral and the first priority thereof,
(B) maintain or cause to be maintained at all times the pledge of the
Collateral to Secured Parties and Secured Parties’ lien on and security interest
in the Collateral and the first priority thereof, and (C) defend the
Collateral and Secured Parties’ lien on and security interest therein and the
first priority thereof against all claims and demands of all persons at any
time
claiming the same or any interest therein adverse to Secured Parties, and pay
pro rata all costs and expenses (including, without limitation, reasonable
attorneys’ fees and expenses) in connection with such defense.
(ii) No
Individual Pledgor shall sell, transfer, pledge, assign or otherwise dispose
of
any of the Collateral or any interest therein, and no Individual Pledgor shall
create, incur, assume or suffer to exist any Encumbrance with respect to such
Individual Pledgor’s portion of the Collateral or any interest therein (except
pursuant hereto).
(iii)
No
Individual Pledgor shall take any action in connection with the Collateral
or
otherwise which would impair the value of the interests or rights of such
Individual Pledgor therein or which would impair the interests or rights of
Secured Parties therein or with respect thereto.
| 7. |
RESPONSIBILITIES
OF SECURED PARTIES IN POSSESSION OF THE
COLLATERAL
|
(a) Secured
Parties shall have no duty with respect to the Collateral other than the duty
to
use reasonable care in the custody and preservation of the Collateral.
(b) Secured
Parties shall be protected in acting upon any written notice, request, waiver,
consent, certificate, receipt, authorization, power of attorney or other paper
or document which Secured Parties in good faith believe to be
genuine.
| 8. |
RETURN
OF COLLATERAL
|
Upon
the
later of (i) the fourth (4th)
anniversary of the date first written above or (ii) the resolution of all Events
of Default or CHP Indemnity Claims asserted prior to the date set forth in
the
immediately preceding clause (i), if any, this Agreement shall terminate and
the
Collateral then held by Secured Parties shall promptly be returned to Pledgors
at the address of Pledgors set forth herein or at such other address as Pledgors
may direct in writing. Secured Parties shall not be deemed to have made any
representation or warranty with respect to any Collateral so returned, except
that such Collateral is free and clear, on the date of such return, of any
and
all liens, charges and encumbrances arising from Secured Parties’ own
acts.
| 9. |
ADDITIONAL
ACTIONS AND DOCUMENTS
|
Each
Individual Pledgor hereby agrees to take or cause to be taken such further
actions (including, without limitation, the delivery of certificates for all
of
CHR’s shares hereafter acquired by such Pledgor), to execute, deliver and file
or cause to be executed, delivered and filed such further documents and
instruments, and to obtain such consents as may be necessary or desirable,
in
the opinion of Secured Parties, in order to fully effectuate the purposes,
terms
and conditions of this Agreement, whether before, at or after the occurrence
of
an Event of Default.
| 10. |
SURVIVAL
|
It
is the
express intention and agreement of the parties hereto that all covenants,
agreements, statements, representations, warranties and indemnities made by
Pledgors herein shall survive the execution and delivery of this
Agreement.
| 11. |
ENTIRE
AGREEMENT
|
This
Agreement and the Merger Agreement constitutes the entire agreement between
the
parties hereto and supersedes all prior understandings, agreements, or
representations by or among the parties hereto, written or oral.
| 12. |
NOTICES
|
All
notices, demands, requests, claims and other communications hereunder will
be in
writing. Any notice, demand, request, claim or other communication hereunder
shall be deemed duly given if (and then effective three business days after)
it
is sent by registered or certified mail, return receipt requested, postage
prepaid, and addressed to the intended recipient as set forth
below:
If
to an
Individual Pledgor:
c/o
Xxxxx
X. Xxxxxx, Xx.
CNL
Center at City Commons
000
Xxxxx
Xxxxxx Xxxxxx, 00xx
Xxxxx
Xxxxxxx,
Xxxxxxx 00000
Telecopy:
(000) 000-0000
With
copy
to:
Lowndes,
Drosdick, Doster, Xxxxxx & Xxxx, P.A.
000
Xxxxx
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx,
Xxxxxxx 00000
Attn:
Xxxxxxx Xxxxxxxx, Esq.
Telecopy:
(000) 000-0000
If
to
Secured Parties:
Audit
Committee of the Board of Directors
CNL
Hotels & Resorts, Inc.
CNL
Center II at City Commons
000
Xxxxx
Xxxxxx Xxxxxx
Xxxxxxx,
Xxxxxxx 00000
Telecopy:
(000) 000-0000
Attn:
Chairman of the Audit Committee
With
copy
to:
Xxxxxxxxx
Xxxxxxx, LLP
The
MetLife Building
000
Xxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxxxxx X. Xxxxx, Esq.
Telecopy:
(000) 000-0000
Xxxxx
& Xxxxxxx L.L.P.
000
Xxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx,
X.X. 00000
Attn:
J.
Xxxxxx Xxxxxxx, Xx., Esq.
Telecopy:
(000) 000-0000
Any
party
hereto may send any notice, demand, request, claim, or other communication
hereunder to the intended recipient at the address set forth above using any
other means (including personal delivery, expedited courier, messenger service,
telecopy, ordinary mail, or electronic mail), but no such notice, demand,
request, claim, or other communication shall be deemed to have been duly given
unless and until it actually is received by the intended recipient. Any party
hereto may change the address to which notices, requests, demands, claims,
and
other communications hereunder are to be delivered by giving the other parties
hereto notice in the manner herein set forth.
| 13. |
AMENDMENT
AND WAIVERS
|
This
Agreement may not be amended except by an instrument in writing signed by the
parties hereto. No waiver by any party hereto of any default, misrepresentation,
or breach of warranty or covenant hereunder, whether intentional or not, shall
be deemed to extend to any prior or subsequent default, misrepresentation,
or
breach of warranty or covenant hereunder or affect in any way any rights arising
by virtue of any prior or subsequent such occurrence. No delay or failure on
the
part of Secured Parties in exercising any right, power or privilege under this
Agreement or under any other instruments given in connection with or pursuant
to
this Agreement shall impair any such right, power or privilege or be construed
as a waiver of any default or any acquiescence therein. No single or partial
exercise of any such right, power or privilege shall preclude the further
exercise of such right, power or privilege, or the exercise of any other right,
power or privilege. No waiver shall be valid against any party hereto unless
made in writing and signed by such party, as the case may be, and then only
to
the extent expressly specified therein.
| 14. |
SUCCESSION
AND ASSIGNMENT
|
This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and permitted assigns. This Agreement
may
not be assigned by any Individual Pledgor without the prior written consent
of
CHR or by a Secured Party without the prior written consent of XXXX.
| 15. |
SEVERABILITY
|
Any
term
or provision of this Agreement or any other agreement, document or writing
given
pursuant to or in connection with this Agreement that is invalid or
unenforceable in any situation in any jurisdiction shall not affect the validity
or enforceability of the remaining terms and provisions hereof or the validity
or enforceability of the offending term or provision in any other situation
or
in any other jurisdiction.
| 16. |
GOVERNING
LAW
|
THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ANY CHOICE OR CONFLICT
OF
LAW PROVISION OR RULE (WHETHER OF THE STATE OF NEW YORK OR ANY OTHER
JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION
OTHER THAN THE STATE OF NEW YORK.
| 17. |
PRONOUNS
|
All
pronouns and any variations thereof in this Agreement shall be deemed to refer
to the masculine, feminine, neuter, singular or plural, as the identity of
the
person or entity may require.
| 18. |
HEADINGS
|
The
section headings contained in this Agreement are inserted for convenience only
and shall not affect in any way the meaning or interpretation of this
Agreement.
| 19. |
COUNTERPARTS
|
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed an original but all of which together will constitute one and the same
instrument.
[Remainder
of page intentionally left blank.]
-
-
IN
WITNESS WHEREOF, each of the parties hereto has duly executed and delivered
this
Pledge and Security Agreement, or has caused this Pledge and Security Agreement
to be duly executed and delivered on its behalf, as of the day and year first
above written.
PLEDGORS:
CNL
REAL
ESTATE GROUP, INC.
By:
Xxxxx X. Xxxxxx,
Xx.
Name:
Xxxxx X. Xxxxxx, Xx.
Title:
Chief Executive Officer
Xxxxx
X.
Xxxxxx,
Xx.
Xxxxx
X.
Xxxxxx, Xx.
Xxxxxx
X.
Xxxxxx
Xxxxxx
X.
Xxxxxx
C.
Xxxxx
Xxxxxxxxxx
C.
Xxxxx
Xxxxxxxxxx
Xxxxxx
X. Xxxxxxxxx
III
Xxxxxx
X.
Xxxxxxxxx III
Xxxx
X.
Xxxxxxxx
Xxxx
X.
Xxxxxxxx
Xxxxx
A.N.
Xxxxx
Xxxxx
A.N. Xxxxx
Xxxxxx
Verbaas
Xxxxxx
Xxxxxxx
SECURED PARTIES:
| CNL HOTELS & RESORTS, INC. | ||
| |
|
|
| By: | /s/ Xxxxxxxx X. XxXxxxxx | |
|
Name: Xxxxxxxx X. XxXxxxxx |
||
| Title: Senior Vice President, General Counsel and Corporate Secretary | ||
CNL
HOTELS & RESORTS ACQUISITION, LLC
|
||
| |
|
|
| By: | /s/ Xxxxxxxx X. XxXxxxxx | |
|
Name:Xxxxxxxx X. XxXxxxxx |
||
| Title: Senior Vice President, General Counsel and Corporate Secretary | ||
SCHEDULE
A
|
Pledgor
|
Number
of Shares Pledged
|
Proportionate
Share
of Collateral
|
|
CNL
Real Estate Group, Inc.
|
477,299.00
|
63.6399%
|
|
Xxxxx
X. Xxxxxx, Xx.
|
56,062.00
|
7.4749%
|
|
Xxxxxx
X. Xxxxxx
|
100,079.00
|
13.3438%
|
|
C.
Xxxxx Xxxxxxxxxx
|
31,483.00
|
4.1977%
|
|
Xxxxxx
X. Xxxxxxxxx III
|
52,316.00
|
6.9755%
|
|
Xxxx
X. Xxxxxxxx
|
20,831.00
|
2.7775%
|
|
Xxxxx
A.N. Bloom
|
7,764.00
|
1.0352%
|
|
Xxxxxx
Xxxxxxx
|
4,166.00
|
0.5555%
|
|
Total:
|
750,000.00
|
100.00%
|
