BORROWER PLEDGE AGREEMENT
EXHIBIT F-1
BORROWER PLEDGE AGREEMENT
This PLEDGE AGREEMENT (as amended, restated, supplemented, or otherwise modified from time to time, this “Pledge Agreement”), dated as of February 23, 2000, is made by THE TITAN CORPORATION, a Delaware corporation (the “Pledgor”), in favor of CREDIT SUISSE FIRST BOSTON (“CSFB”), in its capacity as agent (the “Administrative Agent”) for each of the Secured Parties.
WHEREAS, as a condition precedent to the making of the Credit Extensions (including the initial Credit Extension) under the Credit Agreement, the Pledgor is required to execute and deliver this Pledge Agreement;
WHEREAS, the Pledgor has duly authorized the execution, delivery and performance of this Pledge Agreement; and
ARTICLE I
SECTION I.1. Certain Terms. The following terms (whether or not underscored) when used in this Pledge Agreement, including its preamble and recitals, shall have the following meanings (such definitions to be equally applicable to the singular and plural forms thereof):
“Administrative Agent” is defined in the preamble.
“Certificated Interests” means, collectively, all Pledged Shares evidenced by certificates.
“Collateral” is defined in Section 2.1.
“Credit Agreement” is defined in the first recital.
“Distributions” means all stock dividends, liquidating dividends, shares of stock resulting from (or in connection with the exercise of) stock splits, reclassifications, warrants, options, non-cash dividends, mergers, consolidations, and all other distributions (whether similar or dissimilar to the foregoing) on or with respect to any Pledged Interests or other shares of Capital Stock constituting Collateral, but shall not include Dividends.
“Dividends” means cash dividends and cash distributions with respect to any Pledged Interests made in the ordinary course of business and not a liquidating dividend.
"Interest Rate Hedging Agreements" means interest rate swap agreements, interest rate cap agreements and interest rate collar agreements, and all other agreements or arrangements designed to protect the Pledgor against fluctuations in interest rates, entered into between the Pledgor and a Lender or an Affiliate of a Lender, for the purpose of hedging interest rate risk with respect to the Obligations.
"Interest Rate Hedging Obligations" means all liabilities of the Pledgor under Interest Rate Hedging Agreements.
“Lender” and “Lenders” are defined in the first recital.
“LLC” means each limited liability company listed from time to time as a Pledged Interest Issuer on Attachment 1 hereto.
“LLC Interest” means the entire ownership interest of the Pledgor in each Pledged Interest Issuer that is an LLC listed on Attachment 1 hereto, including such Pledgor’s capital account, its gain, loss, deduction and credit of such Pledged Interest Issuer, the Pledgor’s interest in all distributions made or to be made by such Pledged Interest Issuer to the Pledgor and all of the other rights, titles and interests of the Pledgor as an owner or a member of such Pledged Interest Issuer, whether set forth in the operating or membership agreement of such Pledged Interest Issuer, by separate agreement or otherwise.
“Partnership” means each general partnership or limited partnership listed from time to time as a Pledged Interest Issuer on Attachment 1 hereto.
“Partnership Interest” means the entire ownership interest of the Pledgor in each Pledged Interest Issuer that is a Partnership listed on Attachment 1 hereto, including the Pledgor’s capital account, its gain, loss, deduction and credit of such Pledged Interest Issuer, the Pledgor’s interest in all distributions made or to be made by such Pledged Interest Issuer to the Pledgor and all of the other rights, titles and interests of the Pledgor as an owner, a general partner or a limited partner of such Pledged Interest Issuer, whether set forth in the partnership agreement of such Pledged Interest Issuer, by separate agreement or otherwise.
“Pledge Agreement” is defined in the preamble.
“Pledged Interest Issuers” means each Person identified in Attachment 1 hereto as the issuer of the Pledged Interests (including the maker of each Pledged Note) identified opposite the name of such Person and each Person whose ownership, equity or other similar interests, including shares of Capital Stock, Partnership Interests and LLC Interests, are, or are required to be, pledged hereunder and under the Credit Agreement from time to time.
“Pledged Interests” means (i) all Pledged Shares and (ii) all Pledged Notes.
“Pledged Notes” means all promissory notes of any Pledged Interest Issuer identified on Attachment 1 hereto, and any promissory notes issued to Pledgor in the future, as such promissory notes are amended, restated, supplemented or otherwise modified from time to time, in accordance with Section 4.1.6, together with any promissory note of any Pledged Interest Issuer taken in extension or renewal thereof or substitution therefor.
"Pledged Shares" means (a) all ownership, equity or other similar interests, including shares of Capital Stock, Partnership Interests and LLC Interests, of any Pledged Interest Issuer listed on Attachment 1 hereto and any shares of Capital Stock, Partnership Interests and LLC Interests of any Pledged Interest Issuer obtained in the future by the Pledgor, (b) the certificates representing all such ownership, equity or similar interests and (c) all securities convertible into, and all warrants, options or other rights to acquire, such ownership, equity or similar interets; but excluding all shares of voting stock of each class of any Foreign Subsidiary in excess of 65% of the total issued and outstanding shares of the voting stock of each such class.
“Pledgor” is defined in the preamble.
“Secured Obligations” is defined in Section 2.2.
“Securities Act” is defined in Section 6.2.
“Termination Date” means the date on which all Obligations have been indefeasibly paid in full, all Commitments have been fully terminated and all Letters of Credit have been canceled or otherwise terminated.
“U.C.C.” means the Uniform Commercial Code, as in effect from time to time in the State of New York; provided, that if by reason of mandatory provisions of law or the exercise of remedies, the perfection or the effect of perfection or non-perfection of the Lien granted in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than New York, “U.C.C.” means the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such perfection or effect of perfection or non-perfection or the exercise of remedies.
SECTION I.2. Credit Agreement Definitions. Unless otherwise defined herein or the context otherwise requires, terms used in this Pledge Agreement, including its preamble and recitals, have the meanings provided in the Credit Agreement.
SECTION I.3. U.C.C. Definitions. Unless otherwise defined herein or in the Credit Agreement or the context otherwise requires, terms for which meanings are provided in the U.C.C. are used in this Pledge Agreement with such meanings.
ARTICLE II
(a) all Pledged Interests;
(b) all right, title and interest of the Pledgor, whether now existing or hereafter arising or acquired, in, to and under any partnership agreement, limited liability company agreement or similar agreement which governs the rights and obligations of the holder of ownership, equity or similar interests in a Pledged Interest Issuer;
(c) all Dividends, Distributions, interest and without duplication, other payments and rights with respect to any Pledged Interest; and
(d) all proceeds of any of the foregoing.
SECTION II.2. Security for Obligations. This Pledge Agreement secures the payment in full of all Obligations of the Pledgor now or hereafter existing under the Credit Agreement, each other Loan Document and each Interest Rate Hedging Agreement, whether for principal, interest, costs, fees, indemnities, expenses, Interest Rate Hedging Obligations or otherwise (including all Obligations of the Pledgor now or hereafter existing under this Pledge Agreement and each other Loan Document to which such Pledgor is or may become a party), with all such Obligations being referred to as the “Secured Obligations”.
(a) remain in full force and effect until the Termination Date;
(b) be binding upon the Pledgor and its successors, transferees and assigns; and
(c) inure, together with the rights and remedies of the Administrative Agent hereunder, to the benefit of the Administrative Agent and each other Secured Party.
Without limiting clause (c), any Lender may assign or otherwise transfer (in whole or in part) any Note or Loan held by it to any other Person or entity, and such other Person or entity shall thereupon become vested with all the rights and benefits in respect thereof granted to such Lender under any Loan Document (including this Pledge Agreement) or otherwise, subject, however, to any contrary provisions in such assignment or transfer, and to the provisions of Section 11.11 and Article X of the Credit Agreement.
Upon (i) the sale, transfer or other disposition of Collateral in accordance with the Credit Agreement or (ii) the occurrence of the Termination Date, the security interests granted herein shall automatically terminate with respect to (x) such Collateral (in the case of clause (i)) or (y) all Collateral (in the case of clause (ii)), and at such time the Administrative Agent will, at the Pledgor’s sole expense, deliver to the applicable Pledgor, without any representations, warranties or recourse of any kind whatsoever, all certificates and instruments previously delivered to the Administrative Agent representing or evidencing all Pledged Interests, together with all other Collateral held by the Administrative Agent hereunder, and execute and deliver to the Pledgor such documents as the Pledgor shall reasonably request to evidence such termination.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1.3. As to Pledged Interests. In the case of
(a) any Pledged Interests (other than Pledged Notes) constituting Collateral,
(i) all of such Pledged Interests are duly authorized, and validly issued, fully paid, and non-assessable, and constitute that percentage of the issued and outstanding shares of Capital Stock, Partnership Interests, LLC Interests and other ownership interest of each Pledged Interest Issuer set forth on Attachment 1 hereto; and
(ii) the Pledgor has delivered to the Administrative Agent true and complete copies of the partnership, membership, operating or ownership agreements, as applicable, for each Pledged Interest Issuer that is an LLC or a Partnership, which agreements are currently in full force and effect and have not been amended or modified except as disclosed to the Administrative Agent in writing; and
(b) each Pledged Note, all of such Pledged Notes have been duly authorized, executed, endorsed, issued and delivered, and are the legal, valid and binding obligation of the issuers thereof, and are not in default.
ARTICLE IV
(a) If the Pledgor shall become entitled to receive or shall receive any stock or other certificate (including any certificate representing a Dividend or a Distribution in connection with any reclassification, increase or reduction of capital or any certificate issued in connection with any reorganization), option or rights, whether in addition to, in substitution of, as a conversion of, or in exchange for any portion of the Collateral (or otherwise in respect thereof), the Pledgor shall accept the same as the agent of the Administrative Agent, hold the same in trust for the Administrative Agent and deliver the same forthwith to the Administrative Agent in the exact form received, duly endorsed (in blank) by the Pledgor to the Administrative Agent, if required, together with an undated stock power or other necessary instrument of transfer covering such certificate duly executed in blank by the Pledgor, to be held by the Administrative Agent, subject to the terms of this Pledge Agreement, as additional security for the Secured Obligations. In addition, any sums paid upon or in respect of the Collateral upon the liquidation or dissolution of any Pledged Interest Issuer shall be held by the Administrative Agent as additional security for the Secured Obligations. If any sums of money or property so paid or distributed in respect of any Collateral shall be received by the Pledgor, then the Pledgor shall, until such money or property is paid or delivered to the Administrative Agent, hold such money or property in trust for the Administrative Agent (on behalf of the Secured Parties), segregated from other funds of the Pledgor, as additional collateral securing the Secured Obligations.
(b) Except as otherwise expressly permitted by the Credit Agreement, without the prior written consent of the Administrative Agent, the Pledgor will not (i) consent to any material modification, extension or alteration of the terms of any partnership, membership or operating agreement of the LLCs or the Partnerships or (ii) accept a surrender of any partnership, membership or operating agreement of any of the LLCs or the Partnerships, as applicable, or waive any breach of or default under any such agreement by any other party thereto.
(c) The Pledgor will advise the Administrative Agent promptly, in reasonable detail (i) of any Lien or claim made or asserted against any material part of the Collateral, (ii) of any material change in the composition of the Collateral, and (iii) of the occurrence of any other event relating specifically to the Pledgor or its assets which could reasonably be expected to have a material adverse effect on the aggregate value of the Collateral or on the security interests created hereunder.
SECTION IV.1.5. Voting Rights; Dividends, etc. The Pledgor agrees:
(a) after any Default of the nature referred to in Section 9.1(i) of the Credit Agreement or any Event of Default shall have occurred and be continuing, promptly upon receipt of notice thereof by the Pledgor and without any request therefor by the Administrative Agent, such Pledgor will deliver (properly endorsed where required hereby or requested by the Administrative Agent) to the Administrative Agent all Dividends, Distributions, all other cash payments, and all proceeds of the Collateral, all of which shall be held by the Administrative Agent for the benefit of the Secured Parties as additional Collateral for use in accordance with Section 6.4; and
(b) after any Event of Default shall have occurred and be continuing and the Administrative Agent has notified the Pledgor of the Administrative Agent’s intention to exercise its voting power under this Section:
(i) the Administrative Agent may exercise (to the exclusion of the Pledgor) the voting power and all other incidental rights of ownership with respect to any Pledged Interests or other shares of Capital Stock or other ownership interests constituting Collateral and the Pledgor hereby grants the Administrative Agent an irrevocable proxy, exercisable under such circumstances, to vote the Pledged Interests and such other Collateral; and
(ii) promptly to deliver to the Administrative Agent such additional proxies and other documents requested by the Administrative Agent as may be necessary to allow the Administrative Agent to exercise such voting power.
All Dividends, Distributions, cash payments and proceeds which may at any time and from time to time be held by the Pledgor but which the Pledgor is then obligated to deliver to the Administrative Agent, shall, until delivery to the Administrative Agent, be held by the Pledgor separate and apart from its other property in trust for the Secured Parties. The Administrative Agent agrees that unless an Event of Default shall have occurred and be continuing and the Administrative Agent shall have given the notice referred to in clause (b), the Pledgor shall have the exclusive voting power with respect to any shares of Capital Stock or other ownership interests (including any of the Pledged Interests) constituting Collateral and the Administrative Agent shall, upon the written request of the Pledgor, promptly deliver such proxies and other documents, if any, as shall be reasonably requested by the Pledgor which are necessary to allow the Pledgor to exercise voting power with respect to any such share of Capital Stock or other ownership interests (including any of the Pledged Interests) constituting Collateral; provided, however, that no vote shall be cast, or consent, waiver, or ratification given, or action taken by the Pledgor that would impair any Collateral or be inconsistent with or violate any provision of the Credit Agreement, any other Loan Document or any Interest Rate Hedging Agreement.
(a) enter into any agreement amending, supplementing, or waiving any provision of any Pledged Note (including any underlying instrument pursuant to which such Pledged Note is issued) or compromising or releasing or extending the time for payment of any obligation of the maker thereof; or
(b) take or omit to take any action the taking or the omission of which would result in any impairment or alteration of any obligation of the maker of any Pledged Note or other instrument constituting Collateral.
SECTION 4.1.7. Pledgor Remains Liable. Anything herein to the contrary notwithstanding,
(a) the Pledgor shall remain liable to perform all of its duties and obligations as an owner of the Pledged Interests, to the same extent as if this Pledge Agreement had not been executed;
(b) the exercise by the Administrative Agent or any other Secured Party of any of its rights hereunder shall not release the Pledgor from any of its duties or obligations as owner of the Pledged Interests; and
(c) neither the Administrative Agent nor any other Secured Party shall have any obligation or liability as an owner of any Pledged Interest as applicable, by reason of this Pledge Agreement.
ARTICLE V
(a) to ask, demand, collect, xxx for, recover, compromise, receive and give acquittance and receipts for moneys due and to become due under or in respect of any of the Collateral;
(b) to receive, endorse, and collect any drafts or other instruments, documents and chattel paper, in connection with clause (a); and
(c) to file any claims or take any action or institute any proceedings which such Administrative Agent may deem necessary or desirable for the collection of any of the Collateral or otherwise to enforce the rights of such Administrative Agent with respect to any of the Collateral.
The Pledgor hereby acknowledges, consents and agrees that the power of attorney granted pursuant to this Section is irrevocable and coupled with an interest.
(a) ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters relative to any Pledged Interests, whether or not the Administrative Agent has or is deemed to have knowledge of such matters, or
(b) taking any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.
ARTICLE VI
SECTION VI.1. Certain Remedies. If any Event of Default shall have occurred and be continuing:
(a) The Administrative Agent may exercise in respect of the Collateral, in addition to other rights and remedies provided for herein or otherwise available to it, all the rights and remedies of a secured party on default under the U.C.C. (whether or not the U.C.C. applies to the affected Collateral) and also may, without notice except as specified below, sell the Collateral or any part thereof in one or more parcels at public or private sale, at the Administrative Agent’s offices or elsewhere, for cash, on credit or for future delivery, and upon such other terms as the Administrative Agent may deem commercially reasonable. The Pledgor agrees that, to the extent notice of sale shall be required by law, at least ten days’ prior notice to the Pledgor of the time and place of any public sale or the time after which any private sale is to be made shall constitute reasonable notification. The Administrative Agent shall not be obligated to make any sale of Collateral regardless of notice of sale having been given. The Administrative Agent may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned.
(b) The Administrative Agent may
(i) transfer all or any part of the Collateral into the name of the Administrative Agent or its nominee, with or without disclosing that such Collateral is subject to the Lien hereunder,
(ii) notify the parties obligated on any of the Collateral to make payment to the Administrative Agent of any amount due or to become due thereunder,
(iii) enforce collection of any of the Collateral by suit or otherwise, and surrender, release or exchange all or any part thereof, or compromise or extend or renew for any period (whether or not longer than the original period) any obligations of any nature of any party with respect thereto,
(iv) endorse any checks, drafts, or other writings in the Pledgor’s name to allow collection of the Collateral,
(v) take control of any proceeds of the Collateral,
(vi) execute (in the name, place and stead of the Pledgor) endorsements, assignments, stock powers and other instruments of conveyance or transfer with respect to all or any of the Collateral,
(vii) accelerate any Pledged Note which may be accelerated in accordance with its terms and take any other action to collect upon any Pledged Note (including, without limitation, to make any demand for payment thereon), and
(viii) to vote all or any part of the Pledged Interests (whether or not transferred into the name of the Administrative Agent) and give all consents, waivers and ratifications in respect of the Collateral (including, without limitation, under all operating agreements, partnership agreements or other agreements relating to the Collateral) and otherwise act with respect thereto as if it were the outright owner thereof.
(a) execute and deliver, and cause each issuer of the Collateral contemplated to be sold and the directors and officers thereof to execute and deliver, all such instruments and documents, and do or cause to be done all such other acts and things, as may be necessary or, in the opinion of the Administrative Agent, advisable to register such Collateral under the provisions of the Securities Act of 1933, as from time to time amended (the “Securities Act”) and comparable legislation in other jurisdictions, and to cause the registration statement relating thereto to become effective and to remain effective for such period as prospectuses are required by law to be furnished, and to make all amendments and supplements thereto and to the related prospectus which, in the opinion of the Administrative Agent, are necessary or advisable, all in conformity with the requirements of the Securities Act and the rules and regulations of the Securities and Exchange Commission applicable thereto and comparable legislation, rules and regulations in other jurisdictions;
(b) use its best efforts to qualify the Collateral under the state securities or “Blue Sky” laws and to obtain all necessary governmental approvals for the sale of the Collateral, as requested by the Administrative Agent;
(c) cause each such Pledged Interest Issuer to make available to its security holders, as soon as practicable, an earnings statement that will satisfy the provisions of Section 11(a) of the Securities Act and comparable legislation in other jurisdictions; and
(d) do or cause to be done all such other acts and things as may be necessary to make such sale of the Collateral or any part thereof valid and binding and in compliance with applicable law.
The Pledgor further acknowledges the impossibility of ascertaining the amount of damages that would be suffered by the Administrative Agent and the Secured Parties by reason of the failure by the Pledgor to perform any of the covenants contained in this Section and, consequently, agrees that, if the Pledgor shall fail to perform any of such covenants, the Pledgor shall pay, as liquidated damages and not as a penalty, an amount equal to the value (as determined by the Administrative Agent) of the Collateral on the date the Administrative Agent shall demand compliance with this Section. Notwithstanding the provisions of this Section 6.2, the Administrative Agent shall not be obligated to register any of the Collateral under the Securities Act in connection with the exercise of remedies hereunder and may elect, in its sole discretion, to sell Collateral or any part thereof by private sale in such manner and under such circumstances as the Administrative Agent may deem necessary or advisable in order that such sale be effected without such registration.
(i) first, to the payment of all Obligations owing to the Administrative Agent pursuant to Section 11.3 of the Credit Agreement and Section 6.5;
(ii) second, after payment in full of the amounts specified in clause (i), to the ratable payment of all other Obligations owing to the Secured Parties, with such amounts applied first to fees and expenses, then to accrued and unpaid interest, then to the outstanding principal amount of the Loans, then to Letter of Credit Outstandings and then to Interest Rate Hedging Obligations; and
(iii) third, after payment in full of the amounts specified in clauses (i) and (ii), and following the Termination Date, to the Pledgor or any other Person lawfully entitled to receive such surplus.
(a) the administration of this Pledge Agreement, the Credit Agreement and any other Loan Document;
(b) the custody, preservation, use, or operation of, or the sale of, collection from, or other realization upon, any of the Collateral;
(c) the exercise or enforcement of any of the rights of the Administrative Agent hereunder; or
(d) the failure by the Pledgor to perform or observe any of the provisions hereof.
The provisions of this Section 6.5 shall survive the Termination Date.
ARTICLE VII
THE TITAN CORPORATION
By
Name: Xxx Xxxxxxxxx
Title: Assistant Treasurer
ACKNOWLEDGED AND ACCEPTED:
CREDIT SUISSE FIRST BOSTON
as Administrative Agent
By
Name: Xxxxxx X. Xxxxx
Title: Vice President
By
Name:
Title:
EXHIBIT A
to Borrower
Pledge Agreement
INSTRUCTION TO REGISTER PLEDGE
___________ __, ____
[ ]
Attention: ________________
Ladies and Gentlemen:
The undersigned, a [member] [partner] [shareholder] of ___________, [a ___________ limited liability company] [a __________ corporation] [a ___________ partnership] (the “Company”), hereby instructs the Company to register on the books of the Company the pledge of the undersigned’s [membership] [partnership] interest in favor of Credit Suisse First Boston, as administrative agent (the “Administrative Agent”), pursuant to the Borrower Pledge Agreement, dated as of February 23, 2000, made by, among others, the undersigned in favor of the Administrative Agent.
Very truly yours,
THE TITAN CORPORATION
By:______________________
Name:
Title:
cc: Credit Suisse First Boston
EXHIBIT B
to Borrower
Pledge Agreement
INITIAL TRANSACTION STATEMENT
___________ __, ____
To: Credit Suisse First Boston
Attention:
This statement is to advise you that a pledge of the following uncertificated securities has been registered in the name of Credit Suisse First Boston, as Administrative Agent (the “Administrative Agent”), as follows:
1. Uncertificated Securities:
The entire [limited liability company] [partnership] interests of THE TITAN CORPORATION in the undersigned [limited liability company] [_____ partnership] [corporation].
2. Registered Owner:
THE TITAN CORPORATION
3. Pledged in favor of:
Credit Suisse First Boston,
as the Administrative Agent
4. There are no liens or restrictions of the undersigned [limited liability company] [_______ partnership] [corporation] and no adverse claims to which the uncertificated securities are or may be subject known to the undersigned [limited liability company] [______ partnership] [corporation], other than in favor of Credit Suisse First Boston, in its capacity as the Administrative Agent.
5. The pledge was registered on _______ __, ____.
6. No transfer of the uncertificated securities shall be made without the prior written consent of the Administrative Agent.
THIS STATEMENT IS MERELY A RECORD OF THE RIGHTS OF THE ADDRESSEE AS OF THE TIME OF ITS ISSUANCE. DELIVERY OF THIS STATEMENT, OF ITSELF, CONFERS NO RIGHTS ON THE RECIPIENT. THIS STATEMENT IS NEITHER A NEGOTIABLE INSTRUMENT NOR A SECURITY.
Very truly yours,
[NAME OF PLEDGED INTEREST ISSUER]
By:___________________________________
Name:
Title:
ATTACHMENT 1
to Borrower
Pledge Agreement
Pledged Interests
Pledged Notes
Location of Pledgor (Section 3.1.4)
The Titan Corporation
0000 Xxxxxxx Xxxx Xxxx
Xxx Xxxxx, XX 00000