Exhibit 10.5
EXECUTION COPY
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (this "Agreement"), dated as of January 28,
1999, is executed by and between BARNEYS NEW YORK, INC. (the "Pledgor"), and
CITICORP USA, INC., as "Administrative Agent" for itself and for the "Lenders"
and the "Issuing Banks" under the Credit Agreement defined below. Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings ascribed to such terms in the "Credit Agreement" (as defined below).
WITNESSETH:
(1) Barney's, Inc., Barneys America, Inc., PFP Fashions Inc.,
Barneys (CA) Lease Corp., Barneys (NY) Lease Corp., Xxxxx All-American
Sportswear Corp., BNY Licensing Corp., and Barneys America (Chicago) Lease Corp.
(collectively the "Borrowers") have entered into the Credit Agreement dated as
of even date herewith with the financial institutions a party thereto as lenders
(the "Lenders"), the financial institutions a party thereto as issuing banks
(the "Issuing Banks"), Citicorp USA, Inc., as administrative agent (the
"Administrative Agent") for the Lenders and the Issuing Banks and General
Electric Capital Corporation as documentation agent (as amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
pursuant to which the Lenders and the Issuing Banks have agreed, subject to
certain conditions precedent, to make loans and other financial accommodations
to the Borrowers from time to time;
(2) The Pledgor owns the issued and outstanding equity interests
(the "Equity Interests") set forth on EXHIBIT A attached hereto and made a part
hereof; and
(3) The Administrative Agent, the Lenders and the Issuing Banks have
required, as a condition to their entering into the Credit Agreement, that the
Pledgor execute and deliver this Agreement;
NOW, THEREFORE, for and in consideration of the foregoing and of any
financial accommodations or extensions of credit heretofore, now or hereafter
made to or for the benefit of the Borrowers pursuant to the Credit Agreement or
any other agreement, instrument or document executed pursuant to or in
connection therewith, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Pledgor and the
Administrative Agent hereby agree as follows:
1. PLEDGE. The Pledgor hereby pledges to the Administrative
Agent, for the benefit of the Administrative Agent, the Lenders, the Issuing
Banks and the other Holders, and grants to the Administrative Agent for the
benefit of the Administrative Agent, the Lenders, the
Issuing Banks and the other Holders, a security interest in, the following
(collectively, the "Pledged Collateral"):
(a) All of the right, title and interest of the Pledgor in the
Equity Interests, whether now existing or hereafter arising, and the
certificates representing the shares of such capital stock (such
now-existing shares being identified on EXHIBIT A attached hereto and made
a part hereof), all options and warrants for the purchase of additional
equity interests now or hereafter held in the name of the Pledgor (all of
said Equity Interests, options and warrants and all capital stock held in
the name of the Pledgor as a result of the exercise of such options or
warrants being hereinafter collectively referred to as the "Pledged
Stock"), herewith delivered to the Administrative Agent accompanied by
stock powers in the form of EXHIBIT B attached hereto and made a part
hereof duly executed in blank, and all dividends, distributions, cash,
instruments and other property from time to time received, receivable or
otherwise distributed in respect of, or in exchange for, any or all of the
Pledged Stock;
(b) All additional equity interests from time to time acquired by
the Pledgor in any manner, and the certificates representing such
additional equity interests (any such additional equity interests shall
constitute part of the Pledged Stock and the Administrative Agent is
irrevocably authorized to amend EXHIBIT A from time to time to reflect
such additional equity interests), and all options, warrants, dividends,
distributions, cash, instruments and other rights and options from time to
time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such equity interests;
(c) The property and interests in property described in SECTION 4
below; and
(d) All proceeds of the foregoing.
2. SECURITY FOR LIABILITIES. The Pledged Collateral secures the
prompt payment, performance and observance of (i) all Obligations and (ii) all
obligations of Pledgor under this Agreement (all such obligations referred to in
clauses (i) and (ii) now or hereafter existing being hereinafter collectively
referred to as the "Liabilities").
3. DELIVERY OF PLEDGED COLLATERAL; REGISTRATION AND
ACKNOWLEDGMENTS. All certificates or instruments representing or evidencing the
Pledged Collateral, if any, shall be delivered to and held by or on behalf of
the Administrative Agent pursuant hereto and shall be in suitable form for
transfer by delivery and shall be accompanied by duly executed instruments of
transfer, powers, or assignments in blank as appropriate (such instruments of
transfer, powers, or assignments in blank, being the "Powers"), all in form and
substance satisfactory to the Administrative Agent. After the occurrence and
during the continuance of an Event of Default, the Administrative Agent shall
have the right, at any time in its discretion and without notice to the Pledgor,
to transfer to or to register in the name of the Administrative Agent or any of
its nominees any or all of the Pledged Collateral, subject only to the revocable
rights specified in SECTIONS 7
AND 8. In addition, the Administrative Agent shall have the right at any time to
exchange certificates or instruments representing or evidencing Pledged
Collateral for certificates or instruments of smaller or larger denominations.
4. PLEDGED COLLATERAL ADJUSTMENTS. If, during the term of this
Agreement:
(a) Any stock dividend, reclassification, readjustment or other
change is declared or made in the capital structure of any issuer of the
Pledged Stock, or any option included within the Pledged Collateral is
exercised, or both, or
(b) Any subscription warrants, shares, or any other rights or
options shall be issued in connection with the Pledged Collateral,
then all new, substituted and additional shares, warrants, shares, rights,
options or other securities, issued by reason of any of the foregoing, shall be
immediately delivered to and held by the Administrative Agent under the terms of
this Agreement and shall constitute Pledged Collateral hereunder; PROVIDED,
HOWEVER, that nothing contained in this SECTION 4 shall be deemed to permit any
distribution, issuance of additional shares, warrants, shares, rights or
options, reclassification, readjustment or other change in the capital structure
which is not expressly permitted in the Credit Agreement nor to prohibit any
such distribution, issuance of additional equity interests, warrants, shares,
rights or options, reclassification, readjustment or other change in the capital
structure of such issuer which is expressly permitted in the Credit Agreement.
5. SUBSEQUENT CHANGES AFFECTING PLEDGED COLLATERAL. The Pledgor
represents and warrants that it has made its own arrangements for keeping itself
informed of changes or potential changes affecting the Pledged Collateral
(including, but not limited to, rights to convert, rights to subscribe, payment
of distributions, reorganization or other exchanges, offers to purchase and
voting rights), and the Pledgor agrees that none of the Administrative Agent,
any of the Lenders or any Issuing Banks shall have any obligation to inform the
Pledgor of any such changes or potential changes or to take any action or omit
to take any action with respect thereto. The Administrative Agent may, after the
occurrence and during the continuance of an Event of Default, without notice and
at its option, transfer or register the Pledged Collateral or any part thereof
into its or its nominee's name with or without any indication that such Pledged
Collateral is subject to the security interest hereunder.
6. REPRESENTATIONS AND WARRANTIES. The Pledgor represents and
warrants as follows:
(a) The Pledgor is the sole legal and beneficial owner of the
Equity Interests as set forth on Exhibit A attached hereto and made a part
hereof, free and clear of any Lien except for the security interest
created by this Agreement;
(b) The Pledgor has full power and authority to enter into this
Agreement;
(c) There are no restrictions upon the voting rights associated
with, or upon the transfer of, any of the Pledged Collateral except
pursuant to the Securities Act;
(d) The Pledgor has the right to vote, pledge, assign and grant a
security interest in or otherwise transfer such Pledged Collateral free of
any Liens, except as set forth in paragraph (c) above;
(e) No authorization, approval, or other action by, and no notice
to or filing with, any Governmental Authority is required either (i) for
the pledge of the Pledged Collateral pursuant to this Agreement or for the
execution, delivery or performance of this Agreement by the Pledgor or
(ii) for the exercise by the Administrative Agent of the voting or other
rights provided for in this Agreement or the remedies in respect of the
Pledged Collateral pursuant to this Agreement (except as may be required
in connection with such disposition by laws affecting the offering and
sale of securities generally);
(f) The pledge of the Pledged Collateral pursuant to this
Agreement, together with the delivery of the stock certificates pertaining
thereto to the Administrative Agent, creates a valid and perfected first
priority security interest in the Pledged Collateral, in favor of the
Administrative Agent for the benefit of the Administrative Agent, the
Lenders, the Issuing Banks and the other Holders, securing the payment and
performance of the Liabilities;
(g) This Agreement has been duly executed and delivered by and on
behalf of Pledgor and constitutes the legal, valid and binding obligation
of the Pledgor, enforceable against the Pledgor in accordance with its
terms;
(h) There is no action, suit, proceeding, governmental
investigation or arbitration, at law or in equity, or before or by any
Governmental Authority, pending, or to the knowledge of the Pledgor,
threatened against the Pledgor or any of its property which will
materially and adversely affect the ability of the Pledgor to perform its
obligations under this Agreement;
(i) The Pledgor (i) is a corporation duly formed, validly existing
and in good standing and is duly qualified to do business under the laws
of the State of its incorporation and (ii) has all requisite corporate
power and authority to own, operate and encumber its property and assets
and to conduct its business as presently conducted and as proposed to be
conducted in connection with and following the consummation of the
transactions contemplated by this Agreement, the Credit Agreement or any
of the other Loan Documents;
(j) The execution, delivery and performance of this Agreement by
the Pledgor (i) does not violate any indenture, mortgage, or any other
agreement to which the Pledgor is a party or by which any of its
properties or assets may be bound; (ii) complies with all
corporate organization documents of the Pledgor; and (iii) does not
violate any restriction on such transfer or encumbrance of the Pledged
Collateral; and
(k) The Powers are effective endorsements duly executed by an
appropriate person and give the Administrative Agent the authority they
purport to confer.
7. VOTING RIGHTS. During the term of this Agreement, and except
as provided in this SECTION 7 below, the Pledgor shall have the right to vote
the Pledged Stock on all corporate questions in a manner not inconsistent with
the terms of this Agreement, the Credit Agreement and the other Loan Documents.
After the occurrence and during the continuation of an Event of Default, the
Administrative Agent shall, at the Administrative Agent's option and following
written notice from the Administrative Agent to the Pledgor, exercise all voting
rights pertaining to the Pledged Collateral, including the right to take action
by shareholder consent.
8. DIVIDENDS AND OTHER DISTRIBUTIONS. (a) So long as no Event of
Default shall have occurred and be continuing:
(i) The Pledgor shall be entitled to receive and retain any and
all dividends, interest and distributions paid in respect of the Pledged
Collateral, notwithstanding such dividends, interest and distributions
being subject to the pledge and assignment thereof pursuant to SECTION 1;
PROVIDED, HOWEVER, that any and all
(A) dividends, interest and distributions paid or payable
other than in cash with respect to, and instruments and other
property received, receivable or otherwise distributed with respect
to, or in exchange for, any of the Pledged Collateral;
(B) dividends and other distributions paid or payable in
cash with respect to any of the Pledged Collateral on account of a
partial or total liquidation or dissolution or in connection with a
reduction of capital, capital surplus or paid-in surplus; and
(C) cash paid, payable or otherwise distributed with respect
to principal of, or in redemption of, or in exchange for, any of the
Pledged Collateral;
shall be Pledged Collateral, and shall be forthwith delivered to the
Administrative Agent to hold, for the benefit of the Administrative Agent,
the Lenders, the Issuing Banks and the other Holders, as Pledged
Collateral and shall, if received by the Pledgor, be received in trust for
the Administrative Agent, for the benefit of the Administrative Agent, the
Lenders, the Issuing Banks and the other Holders, be segregated from the
other property or funds of the Pledgor, and be delivered immediately to
the Administrative Agent as Pledged Collateral in the same form as so
received (with any necessary endorsement); and
(ii) The Administrative Agent shall execute and deliver (or cause
to be executed and delivered) to the Pledgor all such proxies and other
instruments as the Pledgor may reasonably request for the purpose of
enabling the Pledgor to receive the dividends or interest payments which
it is authorized to receive and retain pursuant to clause (i) above.
(b) After the occurrence and during the continuation of an Event
of Default:
(i) All rights of the Pledgor to receive the dividends, interest
payments and other distributions which it would otherwise be authorized to
receive and retain pursuant to SECTION 8(A)(I) hereof shall cease, and all
such rights shall thereupon become vested in the Administrative Agent, for
the benefit of the Administrative Agent, the Lenders, the Issuing Banks
and the other Holders, which shall thereupon have the sole right to
receive and hold as Pledged Collateral such dividends, interest payments
and other distributions;
(ii) All dividends, interest payments and other distributions which
are received by the Pledgor contrary to the provisions of clause (i) of
this SECTION 8(B) shall be received in trust for the Administrative Agent,
for the benefit of the Administrative Agent, the Lenders, the Issuing
Banks and the other Holders, shall be segregated from other funds of the
Pledgor and shall be paid over immediately to the Administrative Agent as
Pledged Collateral in the same form as so received (with any necessary
endorsements);
(iii) The Pledgor shall, upon the reasonable request of the
Administrative Agent, at the Pledgor's expense, execute and deliver, and
cause the issuer of the Pledged Stock (other than Barneys Japan Company
Limited) and its officers and directors 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, the Pledgor or its or their counsel, advisable to register the
applicable Pledged Collateral under the provisions of the Securities Act,
and to exercise its best efforts 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, the Pledgor or its or
their counsel, are necessary or advisable, all in conformity with the
requirements of the Securities Act and the rules and regulations of the
Commission applicable thereto;
(iv) The Pledgor shall, upon the reasonable request of the
Administrative Agent, at Pledgor's expense, use its best efforts to
qualify the Pledged Collateral under state securities or "Blue Sky" laws
and to obtain all necessary governmental approvals for the sale of the
Pledged Collateral, as requested by the Administrative Agent;
(v) The Pledgor shall, upon the reasonable request of the
Administrative Agent, at the Pledgor's expense, cause the issuers of the
Pledged Stock to make available to the holders of its securities, as soon
as practicable, earnings statements which will satisfy the
provisions of Section 11(a) of the Securities Act; and
(vi) The Pledgor shall, upon the reasonable request of the
Administrative Agent, at the Pledgor's expense, do or cause to be done all
such other acts and things as may be necessary to make such sale of the
Pledged Collateral or any part thereof valid and binding and in compliance
with applicable law.
The Pledgor will reimburse the Administrative Agent for all expenses incurred by
the Administrative Agent, including, without limitation, reasonable attorneys'
and accountants' fees and expenses in connection with the foregoing. Upon or at
any time after the occurrence and during the continuation of an Event of
Default, if the Administrative Agent determines that, prior to any public
offering of any securities constituting part of the Pledged Collateral, such
securities should be registered under the Securities Act and/or registered or
qualified under any other federal or state law and such registration and/or
qualification is not practicable, then the Pledgor agrees that it will be
commercially reasonable if a private sale, upon at least ten (10) Business Days'
notice to the Pledgor, is arranged so as to avoid a public offering, even though
the sales price established and/or obtained at such private sale may be
substantially less than prices which could have been obtained for such security
on any market or exchange or in any other public sale.
9. TRANSFERS AND OTHER LIENS. Other than as permitted under the
Credit Agreement, the Pledgor agrees that it will not (i) sell, transfer or
otherwise dispose of, or grant any option with respect to, any of the Pledged
Collateral without the prior written consent of the Administrative Agent, or
(ii) create or permit to exist any Lien upon or with respect to any of the
Pledged Collateral (except for the security interest under this Agreement).
10. REMEDIES. (a) The Administrative Agent shall have, in addition
to any other rights given under this Agreement or by law, all of the rights and
remedies with respect to the Pledged Collateral of a secured party under the
Uniform Commercial Code as in effect in the State of New York. In addition,
after the occurrence and during the continuation of an Event of Default, the
Administrative Agent shall have such powers of sale and other powers as may be
conferred by applicable law. With respect to the Pledged Collateral or any part
thereof which shall then be in or shall thereafter come into the possession or
custody of the Administrative Agent or which the Administrative Agent shall
otherwise have the ability to transfer under applicable law, the Administrative
Agent may, in its sole discretion, without notice except as specified below,
after the occurrence and during the continuation of an Event of Default, sell or
cause the same to be sold at any exchange, broker's board or at public or
private sale, in one or more sales or lots, at such price as the Administrative
Agent may deem best, for cash or on credit or for future delivery, without
assumption of any credit risk, and the purchaser of any or all of the Pledged
Collateral so sold shall thereafter own the same, absolutely free from any
claim, encumbrance or right of any kind whatsoever. The Administrative Agent,
any Lender or any Issuing Banks may, in its own name, or in the name of a
designee or nominee, buy the Pledged Collateral at any public sale and, if
permitted by applicable law, buy the Pledged Collateral at any private sale. The
Pledgor will pay to the Administrative Agent all reasonable expenses (including,
without limitation, court costs
and reasonable attorneys, and paralegals' fees and expenses) of, or incident to,
the enforcement of any of the provisions hereof. The Administrative Agent agrees
to distribute any proceeds of the sale of the Pledged Collateral in accordance
with the Credit Agreement and the Pledgor shall remain liable for any deficiency
following the sale of the Pledged Collateral.
(b) Unless any of the Pledged Collateral threatens to decline
speedily in value or is or becomes of a type sold on a recognized market, the
Administrative Agent will give the Pledgor reasonable notice of the time and
place of any public sale thereof, or of the time after which any private sale or
other intended disposition is to be made. Any sale of the Pledged Collateral
conducted in conformity with reasonable commercial practices of banks,
commercial finance companies, insurance companies or other financial
institutions disposing of property similar to the Pledged Collateral shall be
deemed to be commercially reasonable. Notwithstanding any provision to the
contrary contained herein, the Pledgor agrees that any requirements of
reasonable notice shall be met if such notice is received by the Pledgor as
provided in SECTION 25 below at least ten (10) Business Days before the time of
the sale or disposition. Any other requirement of notice, demand or
advertisement for sale is waived, to the extent permitted by law.
(c) In view of the fact that federal and state securities laws may
impose certain restrictions on the method by which a sale of the Pledged
Collateral may be effected after an Event of Default, the Pledgor agrees that
after the occurrence and during the continuation of an Event of Default, the
Administrative Agent may, from time to time, attempt to sell all or any part of
the Pledged Collateral by means of a private placement restricting the bidders
and prospective purchasers to those who are qualified and will represent and
agree that they are purchasing for investment only and not for distribution. In
so doing, the Administrative Agent may solicit offers to buy the Pledged
Collateral, or any part of it, from a limited number of investors deemed by the
Administrative Agent, in its reasonable judgment, to be financially responsible
parties who might be interested in purchasing the Pledged Collateral. If the
Administrative Agent solicits such offers from not less than four (4) such
investors, then the acceptance by the Administrative Agent of the highest offer
obtained therefrom shall be deemed to be a commercially reasonable method of
disposing of such Pledged Collateral; provided, however, that this Section does
not impose a requirement that the Administrative Agent solicit offers from four
or more investors in order for the sale to be commercially reasonable.
11. SECURITY INTEREST ABSOLUTE. All rights of the Administrative
Agent and security interests hereunder, and all obligations of the Pledgor
hereunder, shall be absolute and unconditional irrespective of:
(i) Any lack of validity or enforceability of the Credit
Agreement, the Loan Documents, or any other agreement or instrument
relating thereto;
(ii) Any change in the time, manner or place of payment of, or in
any other term of, all or any part of the Liabilities, or any other
amendment or waiver of or any consent to any departure from the Credit
Agreement or the other Loan Documents;
(iii) Any exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to
departure from any guaranty, for all or any part of the Liabilities; or
(iv) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, the Pledgor in respect of the
Liabilities or of this Agreement.
12. ADMINISTRATIVE AGENT APPOINTED ATTORNEY-IN-FACT. The Pledgor
hereby appoints the Administrative Agent its attorney-in-fact, with full
authority, in the name of the Pledgor or otherwise, after the occurrence and
during the continuation of an Event of Default, from time to time in the
Administrative Agent's sole discretion, to take any action and to execute any
instrument which the Administrative Agent may deem necessary or advisable to
accomplish the purposes of this Agreement, including, without limitation, to
receive, endorse and collect all instruments made payable to the Pledgor
representing any dividend, interest payment or other distribution in respect of
the Pledged Collateral or any part thereof and to give full discharge for the
same and to arrange for the transfer of all or any part of the Pledged
Collateral on the books of the issuers of the Pledged Stock to the name of the
Administrative Agent or the Administrative Agent's nominee.
13. WAIVERS. The Pledgor waives to the fullest extent permitted by
applicable laws presentment and demand for payment of any of the Liabilities,
protest and notice of dishonor or Event of Default with respect to any of the
Liabilities and all other notices to which the Pledgor might otherwise be
entitled except as otherwise expressly provided herein or in the Credit
Agreement.
14. TERM. This Agreement shall remain in full force and effect
until the final payment in full, in cash, of the Liabilities, the Commitment
Termination Date has occurred and the Credit Agreement has terminated pursuant
to its terms. Upon the termination of this Agreement as provided above (other
than as a result of the sale of the Pledged Collateral), the Administrative
Agent will release the security interest created hereunder and, if it then has
possession of any Pledged Stock, will deliver any Pledged Stock previously
delivered to it and the Powers to the Pledgor.
15. DEFINITIONS. The singular shall include the plural and vice
versa and any gender shall include any other gender as the context may require.
16. BINDING EFFECT; SUCCESSORS AND ASSIGNS. This Agreement shall
be binding upon the Pledgor and its successors and assigns, and shall inure to
the benefit of the Administrative Agent, the Lenders, the Issuing Banks and the
other Holders, and their respective successors and assigns. Nothing set forth
herein or in any other Loan Document is intended or shall be construed to give
any other Person any right, remedy or claim under, to or in respect of
this Agreement, the Credit Agreement or any other Loan Document or any
Collateral. The Pledgor's successors shall include, without limitation, a
receiver, trustee or debtor-in-possession of or for the Pledgor.
17. GOVERNING LAW. THIS AGREEMENT HAS BEEN EXECUTED AND DELIVERED
BY THE PARTIES HERETO IN NEW YORK, NEW YORK. ANY DISPUTE BETWEEN THE
ADMINISTRATIVE AGENT AND THE PLEDGOR ARISING OUT OF OR RELATED TO THE
RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT, AND
WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
18. CONSENT TO JURISDICTION; AND SERIVE OF PROCESS. The Pledgor
agrees that the terms of SECTION 13.17 of the Credit Agreement with respect to
consent to jurisdiction and service of process shall apply equally to this
Agreement. The Administrative Agent shall have the right to proceed against the
Pledgor or its personal property in a court in any location to enable the
Administrative Agent to obtain personal jurisdiction over the Pledgor, to
realize on the Pledged Collateral or any other security for the Liabilities or
to enforce a judgment or other court order entered in favor of the
Administrative Agent.
19. WAIVER OF JURY TRIAL. EACH OF THE PLEDGOR AND THE
ADMINISTRATIVE AGENT WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT, OR OTHERWISE, BETWEEN THE ADMINISTRATIVE AGENT AND
THE PLEDGOR ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED
IN CONNECTION HEREWITH. EITHER THE PLEDGOR OR THE ADMINISTRATIVE AGENT MAY FILE
AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO
TRIAL BY JURY.
20. ADVICE OF COUNSEL. The Pledgor represents and warrants to the
Administrative Agent, the Lenders, the Issuing Banks and the other Holders that
it has discussed this Agreement and, specifically, the provisions of SECTIONS 17
through 20 hereof, with the Pledgor's lawyers.
21. SEVERABILITY. If any provision of this Agreement is held to be
prohibited or unenforceable in any jurisdiction the substantive laws of which
are held to be applicable hereto, such prohibition or unenforceability shall not
affect the validity or enforceability of the remaining provisions hereof and
shall not invalidate or render unenforceable such provision in any other
jurisdiction.
22. FURTHER ASSURANCES. The Pledgor agrees that at any time and
from time to time, at the expense of the Pledgor, the Pledgor will promptly
execute and deliver all further instruments and documents, and take all further
action, that may be necessary or desirable, or that the Administrative Agent may
reasonably request, in order to perfect and protect any security interest
granted or purported to be granted hereby or to enable the Administrative Agent
to
exercise and enforce its rights and remedies hereunder with respect to any of
the Pledged Collateral.
23. THE ADMINISTRATIVE AGENT'S DUTY OF CARE. The Administrative
Agent shall not be liable for any acts, omissions, errors of judgment or
mistakes of fact or law including, without limitation, acts, omissions, errors
or mistakes with respect to the Pledged Collateral, except for those arising out
of or in connection with the Administrative Agent's (i) gross negligence or
willful misconduct, or (ii) failure to use reasonable care with respect to the
safe custody of the Pledged Collateral in the Administrative Agent's possession.
Without limiting the generality of the foregoing, the Administrative Agent shall
be under no obligation to take any steps necessary to preserve rights in the
Pledged Collateral against any other parties but may do so at its option. All
expenses incurred in connection therewith shall be for the sole account of the
Pledgor, and shall constitute part of the Liabilities secured hereby.
24. NOTICES. Any notice, demand, request or any other
communication required or desired to be served, given or delivered hereunder
shall be in writing and shall be served, given or delivered as provided in
SECTION 13.08 of the Credit Agreement.
25. INDEMNITY AND EXPENSES. The Pledgor will upon demand pay to
the Administrative Agent the amount of any and all reasonable expenses,
including the reasonable fees and expenses of its counsel and of any experts and
agents, which the Administrative Agent may incur in connection with (i) the
administration of this Agreement, (ii) the custody, preservation, use or
operation of, or the sale of, collection from, or other realization upon, any of
the Pledged Collateral, (iii) the exercise or enforcement of any of the rights
of the Administrative Agent hereunder or (iv) the failure by the Pledgor to
perform or observe any of the provisions hereof.
26. AMENDMENTS, WAIVERS AND CONSENTS. None of the terms or
provisions of this Agreement may be waived, altered, modified or amended, and no
consent to any departure by the Pledgor herefrom shall be effective, except by
or pursuant to an instrument in writing which (i) is duly executed by the
Pledgor and the Administrative Agent and (ii) complies with the requirements of
the Credit Agreement. Any such waiver shall be valid only to the extent set
forth therein. A waiver by the Administrative Agent of any right or remedy under
this Agreement on any one occasion shall not be construed as a waiver of any
right or remedy which the Administrative Agent would otherwise have on any
future occasion. No failure to exercise or delay in exercising any right, power
or privilege under this Agreement on the part of the Administrative Agent shall
operate as a waiver thereof; and no single or partial exercise of any right,
power or privilege under this Agreement shall preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.
27. SECTION HEADINGS: TERMS. The section headings herein are for
convenience of reference only, and shall not affect in any way the
interpretation of any of the provisions hereof. Unless otherwise defined herein
or in the Credit Agreement, terms used in Article 8 and Article 9 of the Code
are used herein as therein defined.
28. EXECUTION IN COUNTERPARTS. This Agreement may be executed in
any number of counterparts, each of which shall be an original, but all of which
shall together constitute one and the same agreement.
29. MERGER. This Agreement, taken together with all the other Loan
Documents, embodies the entire agreement and understanding, between the Pledgor
and the Administrative Agent, any Lender or any Issuing Banks and supersedes all
prior agreements and understandings, written and oral, relating to the subject
matter hereof.
30. TERMINATION; RELEASE OF COLLATERAL. Notwithstanding anything
in this Agreement to the contrary, the Pledgor may, to the extent permitted by
SECTION 9.02 of the Credit Agreement, sell, assign, transfer or otherwise
dispose of any Pledged Collateral. In addition, the Pledged Collateral shall be
subject to release in accordance with SECTION 12.09(C) of the Credit Agreement
(such Pledged Collateral and the Pledged Collateral referred to in the
immediately preceding sentence being the "Released Collateral"). The Liens under
this Agreement shall terminate with respect to the Released Collateral upon such
sale, transfer, assignment, disposition or release and upon the request of the
Pledgor, the Administrative Agent shall execute and deliver such instrument or
document as may be necessary to release the Liens granted hereunder; PROVIDED,
HOWEVER, that (i) the Administrative Agent shall not be required to execute any
such documents on terms which, in the Administrative Agent's opinion, would
expose the Administrative Agent to liability or create any obligation or entail
any consequence other than the release of such Liens without recourse or
warranty, and (ii) such release shall not in any manner discharge, affect or
impair the Liabilities or any Liens on (or obligations of the Pledgor in respect
of) all interests retained by the Pledgor, including without limitation, the
proceeds of any sale, all of which shall continue to constitute part of the
Pledged Collateral.
IN WITNESS WHEREOF, the Pledgor and the Administrative Agent have
executed this Agreement as of the date set forth above.
BARNEYS NEW YORK, INC.
By: /s/ Xxxxxx Xxxxxxx
-------------------------------------
Title: Executive VP and CFO
----------------------------------
Acknowledged and agreed to
as of the date first written above.
CITICORP USA, INC., as Administrative Agent
By: /s/ Xxxxxx Xxxxxx
---------------------------------
Vice President
