Exhibit 99.6
XXXXXXX PRG LIQUIDATING INVESTMENTS, LTD.
PLEDGE AGREEMENT
This Agreement, dated as of August __, 2002, is between Xxxxxxx PRG
Liquidating Investments, Ltd., a Texas limited partnership (the "PLEDGOR"), and
Berkshire Fund V, Limited Partnership, a Massachusetts limited partnership
(together with its permitted assignees, collectively, "BERKSHIRE"). The parties
agree as follows:
ARTICLE I
GENERAL
1.1. NOTE. Berkshire is providing extensions of credit to the
Pledgor pursuant to a Secured Promissory Note dated as of the date hereof, as
from time to time in effect (the "NOTE"), between the Pledgor and Berkshire. As
a condition to providing the loans under the Note, Berkshire is requiring the
Pledgor to pledge the stock contemplated hereby to secure and satisfy the
Pledgor's payment obligations under the Note (the "CREDIT OBLIGATIONS").
1.2. CERTAIN RULES OF CONSTRUCTION. Capitalized terms defined in
the Note and not otherwise defined herein are used herein with the meanings so
defined. Certain other capitalized terms are used in this Agreement as
specifically defined below in this Section 1. Except as the context otherwise
explicitly requires, (a) terms defined in the UCC and not otherwise defined
herein have the meaning provided under the UCC and (b) references to a
particular person include such person's successors and assigns to the extent not
prohibited by this Agreement and the Note. References to "the date hereof" mean
the date first set forth above.
1.3. DEFINITIONS. The following definitions apply herein:
(a) "AGREEMENT" means this Pledge Agreement as amended,
modified and from time to time in effect.
(b) "GOVERNMENTAL AUTHORITY" means any government or
political subdivision thereof, whether federal, state, local or
foreign, or any agency, department, commission, board, bureau, court,
tribunal, body, administrative or regulatory authority or
instrumentality of any such government or political subdivision.
(c) "LAW" means any law (including common law), rule,
regulation, restriction, code, statute, ordinance, order, writ,
injunction, judgment, decree or other requirement of a Governmental
Authority.
(d) "LIEN" means any lien, encumbrance, proxy, voting
trust arrangement, pledge, security interest, collateral security
agreement, financing statement (and similar
notices) filed with any Governmental Authority, claim (including any
claim as defined in the Internal Revenue Code of 1986, as amended),
charge, equities, mortgage, pledge, objection, title defect, option,
restrictive covenant or restriction on transfer of any nature
whatsoever, and the interest of the lessor in any property subject to a
capital lease, except for restrictions or transferability imposed by
the Securities Act.
(e) "SUBORDINATION AGREEMENT" means that certain
Subordination Agreement dated as of the date hereof between the
Pledgor, Berkshire and PRG-Xxxxxxx International, Inc. ("PRG").
(f) "UCC" means the Uniform Commercial Code as in effect
in Delaware on the date hereof; PROVIDED, HOWEVER, that with respect to
the perfection of Berkshire's Lien on the Pledged Shares and the effect
of nonperfection thereof, the term "UCC" means the Uniform Commercial
Code as in effect in any jurisdiction the laws of which are made
applicable by section 9-305 of the Uniform Commercial Code as in effect
in Delaware.
ARTICLE II
SECURITY
2.1. PLEDGED SHARES. As security for the payment and performance of
the Credit Obligations, the Pledgor mortgages, pledges and collaterally grants
and assigns to Berkshire, and creates a security interest in favor of Berkshire
in, all of the Pledgor's right, title and interest in and to (but none of its
obligations or liabilities with respect to) the 1,446,168 shares of common stock
of PRG set forth in Exhibit A, being collectively referred to as the "PLEDGED
SHARES."
2.2. COVENANTS WITH RESPECT TO PLEDGED SHARES. The Pledgor
covenants that:
2.2.1. PLEDGED SHARES. The Pledged Shares shall be at all
times duly authorized, validly issued, fully paid and nonassessable.
The Pledgor will deliver to Berkshire certificates representing the
Pledged Shares held by the Pledgor, accompanied by three stock transfer
powers executed in blank and in form and manner satisfactory to
Berkshire. Upon the occurrence and during the continuance of an Event
of Default but subject always to the provisions of the Subordination
Agreement so long as it is in effect, Berkshire may transfer into its
name or the name of its nominee any Pledged Shares. All Pledged Shares
shall be listed on Exhibit A hereto.
2.2.2. NO LIENS OR RESTRICTIONS ON TRANSFER. The Pledged
Shares shall be free and clear of any Liens and restrictions on the
transfer thereof. Except for the arrangements set out in the Option
Agreement, none of the Pledged Shares shall be subject to any option to
purchase or similar rights of any Person.
2.2.3. NO SALE OF PLEDGED SHARES. The Pledgor will not sell,
transfer or otherwise dispose of all or any portion of its interests in
the Pledged Shares except in connection with the Option Agreement and
except to Berkshire as contemplated under the Note or this Agreement.
2.2.4. PERFECTION OF PLEDGED SHARES. This Agreement shall
create in favor of Berkshire, a legal, valid and enforceable first
priority security interest in the Pledged
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Shares. When stock certificates representing such Pledged Shares and
stock transfer powers related thereto duly executed in blank by the
Pledgor are delivered to Berkshire, this Agreement shall provide a
fully perfected, first priority Lien on, and security interest in, all
right, title and interest of the Pledgor in the Pledged Shares, in each
case prior and superior in right to any other Person, except as
provided pursuant to the Option Agreement. Upon Berkshire's reasonable
request from time to time, the Pledgor will execute and deliver, and
file and record in the proper filing and recording places, all such
instruments, including UCC financing statements, and will take all such
other action, as Berkshire deems reasonably necessary for confirming to
it the Pledged Shares, or to carry out any other purpose of this
Agreement or the Note.
2.3. ADMINISTRATION OF PLEDGED SHARES. Subject to the provisions of
the Subordination Agreement and in accordance with Section 7.1 of the Note, the
Pledged Shares shall be administered as follows, and if an Event of Default
shall have occurred and be continuing, Section 2.4 shall also apply.
2.3.1. SEGREGATED PROCEEDS. All sums collected or received
and all property recovered or possessed by the Pledgor in connection
with any Pledged Shares shall be received and held by the Pledgor in
trust for and on Berkshire's behalf, shall be segregated from the
assets and funds of the Pledgor, and shall be delivered to Berkshire.
2.3.2. DISTRIBUTIONS. All distributions on or with respect
to the Pledged Shares, including additional Pledged Shares or other
distributions by way of a dividend or otherwise will be retained by
Berkshire (or if received by the Pledgor shall be held by the Pledgor
in trust and shall be immediately delivered by the Pledgor to Berkshire
in the original form received, endorsed in blank) and held by Berkshire
as part of the Pledged Shares or applied by Berkshire to the payment of
the Credit Obligations.
2.3.3. VOTING.
(a) Until an Event of Default shall occur and be
continuing, the Pledgor shall be entitled to vote or consent with
respect to the Pledged Shares in any manner not inconsistent with the
terms of the Note or the Option Agreement, and Berkshire will (if so
requested) execute appropriate revocable proxies therefor.
(b) If an Event of Default shall have occurred and be
continuing, only Berkshire shall be entitled to vote or consent or take
any other action with respect to the Pledged Shares, and the Pledgor
will (if so requested) execute or cause to be executed appropriate
proxies therefor.
2.4. RIGHT TO REALIZE UPON PLEDGED SHARES. Except to the extent
prohibited by applicable Law that cannot be waived and subject to the provisions
of the Subordination Agreement, this Section 2.4 shall govern Berkshire's right
to realize upon the Pledged Shares if any Event of Default shall have occurred
and be continuing.
2.4.1. ADDITIONAL RIGHTS. The provisions of this Section 2.4
are in addition to any rights and remedies available at law or in
equity and in addition to the provisions of the Note.
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2.4.2. GENERAL AUTHORITY. The Pledgor grants Berkshire full
and exclusive power and authority, subject to the other terms hereof
and applicable law, to take any of the following actions (for the sole
benefit of Berkshire, but at the Pledgor's expense):
(a) To sell, transfer, assign or otherwise deal in or
with any Pledged Shares or the proceeds thereof, as fully as the
Pledgor otherwise could do.
(b) To ask for, demand, take, collect, xxx for and
receive all payments in respect of any Pledged Shares which the Pledgor
could otherwise ask for, demand, take, collect, xxx for and receive for
its own use.
(c) To settle, compromise, prosecute or defend any action
or proceeding with respect to any Pledged Shares and to enforce all
rights and remedies thereunder which the Pledgor could otherwise
enforce.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Pledgor represents and warrants to Berkshire as follows:
3.1. AUTHORIZATION; BINDING OBLIGATION. This Agreement has been
duly and validly executed and delivered by the Pledgor and, assuming due
authorization, execution and delivery by Berkshire, constitutes a legal, valid
and binding obligation of the Pledgor, enforceable against the Pledgor in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and
other federal or state laws of general applicability relating to or affecting
creditors' or secured parties' rights and remedies generally and general
principles of equity, whether considered in an action at law or in equity. The
Pledgor has the legal capacity and all requisite power and authority to execute
and deliver this Agreement and to consummate the transactions contemplated
hereby and to perform its obligations hereunder. Such execution, delivery and
consummation has been duly and validly authorized by all necessary action on the
part of the Pledgor, and no other corporate or other proceedings on the part of
the Pledgor are necessary to authorize such execution, delivery and
consummation.
3.2. TITLE TO THE PLEDGED SHARES. Immediately prior to the pledge
of the Pledged Shares the Pledgor was the record and beneficial owner of, and
had good and marketable title to, the Pledged Shares free and clear of all
Liens. The Pledged Shares owned by the Pledgor are validly issued, duly
authorized and free of any preemptive rights. There are no voting trusts or
other agreements or understandings to which the Pledgor is a party with respect
to the voting of the Pledged Shares. The Pledged Shares are not subject to any
restrictions on transferability other than those imposed by the Securities Act
and applicable state securities laws. Except for the Option Agreement, there are
no options, warrants, calls, commitments or rights of any character to purchase
or otherwise acquire the Pledged Shares from the Pledgor pursuant to which the
Pledgor may be obligated to sell, transfer or otherwise dispose of any of the
Pledged Shares. In the event that (i) the Pledgor defaults under the Note and
Berkshire enforces the provisions of this Agreement, or (ii) the provisions of
Section 3.1 of the Note apply, Berkshire will acquire good and marketable title
to the Pledged Shares, free and clear of all Liens.
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3.3. CONSENTS AND APPROVALS; NO VIOLATION. None of the execution
and delivery of this Agreement, the consummation of the transactions
contemplated hereby, or compliance with any of the provisions hereof, will (i)
require any consent, waiver, approval, authorization or permit of, or filing
with or notification to, or any other action by, any Governmental Authority by
the Pledgor, other than necessary filings on Form 4 with the Securities and
Exchange Commission, (ii) violate the certificate of formation or limited
partnership agreement of the Pledgor, or any Law of any Governmental Authority
which may be applicable to the Pledgor, or by which any of the Pledgor's
activities, properties or assets (including, without limitation the Pledged
Shares) may be bound or affected or (iii) violate, breach, or conflict with, or
constitute (with or without due notice or lapse of time or both) a default (or
give rise to any right of termination, cancellation or acceleration or any
obligation to pay or result in the imposition of any Lien upon any of the
property of the Pledgor (including, without limitation, the Pledged Shares))
under, any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, Lien, contract, agreement, or other instrument or obligation to which
the Pledgor is a party or by which any of the Pledgor's activities, properties
or assets (including, without limitation, the Pledged Shares) may be bound or
affected.
ARTICLE IV
DEFEASANCE
If the Option Agreement is exercised, in whole or in part, and all
corresponding Credit Obligations have been paid, performed and reasonably
determined by Berkshire to have been indefeasibly discharged in full, at the
Pledgor's written request (if appropriate), accompanied by a copy of the written
exercise of the Option Agreement and such certificates and other items as
Berkshire shall reasonably deem necessary, the number of Pledged Shares required
to be delivered by the Pledgor upon the exercise, in whole or in part, of the
Option Agreement shall revert to the Pledgor and the right, title and interest
of Berkshire therein shall terminate. Thereupon, on the Pledgor's demand and at
its cost and expense, Berkshire shall execute proper instruments, acknowledging
satisfaction of and discharging this Agreement with respect to the Pledged
Shares to be transferred, and shall redeliver to the Pledgor, for delivery to
PRG, the number of Pledged Shares required to be delivered by the Pledgor to PRG
upon the exercise of the Option Agreement.
ARTICLE V
MISCELLANEOUS
5.1. SURVIVAL OF REPRESENTATION AND WARRANTIES. All
representations, warranties and covenants made in this Agreement, or made in
writing to Berkshire, by or on behalf of the Pledgor, in connection with the
transactions contemplated by this Agreement shall survive the pledge of the
Pledged Shares, and transfer of ownership of the same to Berkshire under the
Note or this Agreement.
5.2. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS
OF THE STATE OF DELAWARE, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
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5.3. NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if delivered personally, telecopied (with confirmation of receipt),
delivered by nationally-recognized overnight express service or sent by
registered or certified mail (postage prepaid, return receipt requested) to the
parties at the following addresses:
5.3.1. If to Berkshire, to:
Berkshire Partners LLC
Xxx Xxxxxx Xxxxx
Xxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxx X. Xxxxx
With a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
Xxxx X. Xxxxxxxxx, Esq.
5.3.2. If to the Pledgor, to:
Xxxxxxx PRG Liquidating Investments, Ltd.
0000 XXX Xxxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxxxx Xxxxxxx
Telefax: (000) 000-0000
With a copy to:
Malouf, Lynch, Xxxxxxx & Xxxxxxx
000 Xxxxxxx Xxxxxxx Xxxx
0000 Xxxxxxx Xxxx
Xxxxxx, XX 00000
Telephone: (000) 000-0000 (direct dial)
Telecopy: (000) 000-0000 (direct fax)
Attention: Xxxxxx Xxxxxx, Esq.
Xxxxxx X. Xxxxxxx, Esq.
Xxxx X. Xxxxx, Esq.
or to such other address as the person to whom notice is to be given may have
previously furnished to the other in writing in the manner set forth above,
provided that notice of a change of address shall be deemed given only upon
receipt.
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5.4. EXPENSES. Each party hereto shall be solely responsible for
all expenses incurred by it or on its behalf in connection with the preparation
and execution of this Agreement and the consummation of the transactions
contemplated hereby, including, without limitation, the fees and expenses of its
counsel, accountants, brokers, finders, financial advisors and other
representatives.
5.5. SPECIFIC PERFORMANCE. Without limiting the rights of each
party hereto to pursue all other legal and equitable rights available to such
party for the other parties' failure to perform their obligations under this
Agreement, the parties hereto acknowledge and agree that the remedy at law for
any failure to perform their obligations hereunder would be inadequate and that
each of them, respectively, shall be entitled to specific performance,
injunctive relief or other equitable remedies in the event of any such failure.
5.6. DESCRIPTIVE HEADINGS; INTERPRETATION. The headings contained
in this Agreement are for reference purposes only and shall not affect in any
way the meaning or interpretation of this Agreement. References in this
Agreement to Sections mean Sections of this Agreement, unless otherwise
indicated. The term "person" shall mean and include an individual, a
partnership, a joint venture, a corporation, a trust, a governmental entity or
an unincorporated organization. The parties hereto agree that they have been
represented by counsel during the negotiation and execution of this Agreement
and, therefore, waive the application of any law, regulation, holding or rule of
construction providing that ambiguities in an agreement or other document will
be construed against the party drafting such agreement or document.
5.7. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
5.8. SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
parties shall negotiate in good faith with a view to the substitution therefor
of a suitable and equitable solution in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid provision,
provided, however, that the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be in any way impaired thereby, it being intended that all of
the rights and privileges of the parties hereto shall be enforceable to the
fullest extent permitted by law.
5.9. ENTIRE AGREEMENT; THIRD-PARTY BENEFICIARIES. This Agreement
constitutes the entire agreement among the parties with respect to the subject
matter hereof and supersedes all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter hereof,
and is not intended to confer upon any person other than the parties hereto and
their permitted assigns any rights or remedies hereunder.
5.10. SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall
inure to the benefit of Berkshire and its successors and assigns and shall be
binding upon the Pledgor. Berkshire may assign its rights and obligations under
this Agreement, including the right to receive or hold Pledged Shares, to its
affiliates, without the consent of the Pledgor. The Pledgor
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may not assign its rights or obligations under this Agreement without the
written consent of Berkshire.
5.11. FURTHER ASSURANCES. The Pledgor and Berkshire agree to execute
and deliver such other documents, certificates, agreements and other writings
and to take such other actions as may be necessary or desirable in order to
implement the transactions contemplated by this Agreement.
5.12. TERMINATION. This Agreement will terminate upon the full
satisfaction of the Credit Obligations by Borrower.
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Each of the undersigned has caused this Agreement to be executed and
delivered by its duly authorized officer as of the date first written above.
XXXXXXX PRG LIQUIDATING INVESTMENTS, LTD.,
a Texas limited partnership
By: Xxxxxxx PRG Liquidating Investments GP, L.L.C.,
a Texas limited liability company
By:
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Name: Xxxxxx Xxxxxxx
Title: Manager/President
BERKSHIRE FUND V, LIMITED PARTNERSHIP
By: Fifth Berkshire Associates LLC
its General Partner
By:
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Name:
Title:
EXHIBIT A
PLEDGED SHARES
Shares of
Holder Common Stock Certificate No.
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Xxxxxxx PRG Liquidating 1,446,168
Investments, Ltd.
