Exhibit 99.7
EXECUTION COPY
SHARE PLEDGE AGREEMENT
DATED 3RD MARCH, 2004
BETWEEN
CP FILMS VERTRIEBS GMBH
AS PLEDGOR
AND
KBC BANK NV
AS PLEDGEE
XXXXX & XXXXX
FRANKFURT
CONTENTS
CLAUSE PAGE
1. Interpretation....................................2
2. Pledge............................................4
3. Independent Pledges...............................4
4. Security Purpose..................................4
5. Dividends.........................................4
6. Exercise of Voting Rights.........................5
7. Enforcement of Pledge.............................6
8. Maintenance of Liable Capital.....................7
9. Undertakings of the Pledgor.......................8
10. Representations and Warranties....................9
11. Waiver............................................9
12. Indemnity........................................10
13. Duration.........................................10
14. Costs and Expenses...............................10
15. Miscellaneous....................................11
16. Severability.....................................11
17. Confirmation of Release..........................11
18. Notices..........................................11
19. Governing Law....................................12
20. Jurisdiction.....................................12
21. Notification.....................................12
THIS SHARE PLEDGE AGREEMENT (the AGREEMENT) is made on 3rd March, 2004
BETWEEN:
(1) CP FILMS VERTRIEBS GMBH, a limited liability company (Gesellschaft
mit beschrankter Haftung) organised under the laws of Germany,
having its corporate seat in Bielefeld, Germany, which is
registered in the Commercial Register (Handelsregister) at the
Local Court (Amtsgericht) of Bielefeld under registration number
HRB 33407
(the PLEDGOR)
and
(2) KBC BANK NV, a Belgian bank with registered office at Xxxxxxxxx 0,
X-0000 Xxxxxxxx, Xxxxxxx and registered at the Crossroads Bank for
Enterprises under enterprise number 0462.920.226
(the PLEDGEE).
WHEREAS:
(A) Solutia Europe SA/NV (the ISSUER) and the holders of the Notes have
agreed to amend and restate the Issuer's euro 200,000,000 6.25
percent Notes due 2005, as amended and restated, the euro
200,000,000 10.00 percent Senior Secured Notes due 2008 (together
with the Terms and Conditions of Notes (as defined below) and as
amended, modified or supplemented from time to time, the NOTES)
pursuant to an Agreement of Understanding and Restructuring dated
30th January, 2004 among the Issuer and the holders of the Notes
party thereto (as amended, modified or supplemented from time to
time, the AGREEMENT OF UNDERSTANDING). In connection with the
Notes, the Issuer has entered into a Fiscal Agency Agreement dated
11th February, 2004 among the Issuer, Kredietbank S.A.
Luxembourgeoise as fiscal agent and paying agent and KBC Bank NV as
principal paying agent (as amended, modified or supplemented from
time to time, the FISCAL AGENCY AGREEMENT). The holders of the
Notes and the couponholders are entitled to the benefit of, are
bound by and are deemed to have notice of all of the provisions of
the Fiscal Agency Agreement.
(B) It is a requirement of the Agreement of Understanding and the Terms
and Conditions of Notes that the Pledgor pledges the Shares (as
defined below) to the Pledgee to secure its obligations to the
Pledgee as provided herein and undertakes the obligations
contemplated by this Agreement.
(C) Pursuant to the Collateral Agency Agreement (as defined below) the
Pledgee is the joint creditor (together with the relevant holders
of the Notes) of each and every obligation of the Issuer towards
each of the holders of the Notes under the Notes and of the Issuer
and the Pledgor under the other Credit Documents to which the
Issuer and the Pledgor are party, and accordingly the Pledgee will
have its own independent right to demand performance by the Issuer,
or as the case may be the Pledgor, of those obligations. There is
as a result a joint creditorship under New York law between the
holders of the Notes and the Pledgee with regard to the sums owed
under the Notes and the other Credit Documents.
(D) In consideration of the agreements set forth herein and in the
Terms and Conditions of Notes, the Agreement of Understanding and
the other Credit Documents, the Pledgor agrees to create a first
ranking pledge in respect of the Shares (as defined below) in
favour of the Pledgee under the following terms.
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IT IS AGREED as follows:
1. INTERPRETATION
1.1 DEFINITIONS
In this Agreement:
AGREEMENT OF UNDERSTANDING has the meaning given to that term under
(A) of the preamble.
BUSINESS DAY means a day (other than a Saturday or a Sunday) on
which banks are open for general business in Brussels and Frankfurt
am Main.
COLLATERAL AGENCY AGREEMENT means the collateral agency agreement
dated 11th February, 2004 among, inter alia, the Issuer, Amcis AG,
Carbogen AG, certain holders of the Notes and the Pledgee, as
amended, modified or supplemented from time to time.
COLLATERAL DOCUMENTS means the share pledge agreement dated 3rd
March, 2004 between the Issuer and the Pledgee in respect of
shares in the Company, the commercial share pledge agreement dated
17th February, 2004 between the Issuer and the Pledgee in respect
of shares in Solutia Services International SCA/Xxxx.XX, the share
pledge agreement dated 11th February, 2004 between the Issuer and
the Pledgee in respect of shares in Amcis AG, the share pledge
agreement dated 11th February, 2004 between the Issuer and the
Pledgee in respect of shares in Carbogen AG, the floating charge
agreement dated 11th February, 2004 between the Issuer and the
Pledgee, the commercial receivables pledge agreement dated 11th
February, 2004 between the Issuer and the Pledgee, the mortgage
agreement dated 11th February, 2004 between the Issuer and the
Pledgee, the mortgage mandate dated 11th February, 2004 granted by
the Issuer for the purpose of granting mortgages to the Pledgee,
and all other instruments or documents delivered by any Credit
Party pursuant to the Agreement of Understanding or any of the
other Credit Documents (i.e. the Fiscal Agency Agreement, the
Collateral Agency Agreement, the Notes (including without
limitation the Terms and Conditions of Notes), the Subsidiary
Guaranties and any other agreement, instrument, and other document
executed and delivered pursuant hereto or thereto or otherwise
evidencing or securing any Note or any other Obligation of the
Pledgor, as amended, modified or supplemented from time to time) in
order to grant to the Pledgee a mortgage, deed of trust, pledge,
lien, security interest, charge or other encumbrance of any nature
on any real, personal or mixed property of that Credit Party as
security for any of the Obligations of the relevant Credit Party.
COMPANY means CP Films Vertriebs GmbH, a limited liability company
(Gesellschaft mit beschrankter Haftung) organised under the laws of
Germany, having its corporate seat in Bielefeld, which is
registered at the commercial register (Handelsregister) at the
local court (Amtsgericht) of Bielefeld with registered number HRB
33407.
CREDIT DOCUMENTS means the Agreement of Understanding, the Fiscal
Agency Agreement, the Collateral Agency Agreement, the Notes
(including without limitation the Terms and Conditions of Notes),
the Subsidiary Guaranties, the Collateral Documents and any other
agreement, instrument, and other document executed and delivered
pursuant hereto or thereto or otherwise evidencing or securing any
Note or any other Obligation of the Issuer, as amended, modified or
supplemented from time to time.
CREDIT PARTY means the Issuer, Amcis AG, Carbogen AG, the Company
or Solutia Services International SCA/Xxxx.XX and each other
subsidiary of the Issuer which guarantees all or any part of the
Obligations.
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DECLARED DEFAULT means an event of default which has occurred and
is continuing under the Notes which results in the Pledgee serving
a notice of acceleration or a notice that an event of default has
occurred and is continuing on the Pledgor.
EURO, euro OR EUR means the lawful currency of the Participating
Member States.
EXISTING SHARES means the shares set forth in Clause 2.1(b).
FISCAL AGENCY AGREEMENT has the meaning given to that term under
(A) of the preamble.
FUTURE SHARES means any and all shares in the Company issued in
addition to the existing shares which the Pledgor may acquire in
future (including shares newly issued by way of capital increase
(Kapitalerhohung)).
GERMAN SUBSIDIARY GUARANTY means the guaranty made by the Pledgor
in favour of the Pledgee dated on or about the date of this
Agreement.
GERMANY means the Federal Republic of Germany.
ISSUER has the meaning given to that term under (A) of the
preamble.
NOTES has the meaning given to that term under (A) of the Preamble.
OBLIGATION means all present and future indebtedness, obligations
and liabilities of each Credit Party to the Pledgee and the holders
of the Notes which may arise under, out of, or in connection with,
the Fiscal Agency Agreement, the Notes, the Collateral Agency
Agreement, any Subsidiary Guaranty or any other Credit Document, or
any other document made, delivered or given in connection herewith
or therewith.
PARTICIPATING MEMBER STATE means a member state of the European
Union that adopts or has adopted the euro as its lawful currency
under the legislation of the European Union pertaining to the
Economic and Monetary Union.
PARTY means a party to this Agreement.
PLEDGE means the pledge constituted under Clause 2.2. of this
Agreement.
SECURED CLAIMS means all present and future rights and claims
(Anspruche) (whether actual or contingent and whether held jointly
or severally or in any other capacity whatsoever) of the Pledgee
against the Pledgor which may arise under, out of, or in connection
with the Collateral Agency Agreement, the German Subsidiary
Guaranty or any other Credit Document to which the Pledgor is
party.
SECURITY means any and all security granted by the Pledgor or any
third party to the Pledgee with a view to securing the Secured
Claims.
SHARES means the Existing Shares and the Future Shares.
SUBSIDIARY GUARANTIES means the guaranties in favour of the Pledgee
granted by Solutia Services International SCA/Xxxx.XX dated 17th
February, 2004, Amcis AG and Carbogen AG, each dated 11th February,
2004, and the German Subsidiary Guaranty.
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TERMS AND CONDITIONS OF NOTES means the terms and conditions of the
notes as set out in Schedule 1 of the Fiscal Agency Agreement as
amended, modified or supplemented from time to time.
1.2 Where the context so admits, the singular includes the plural and
vice versa.
1.3 The headings in this Agreement are for convenience only and are to
be ignored in construing this Agreement.
1.4 Any reference in this Agreement to a defined document is a
reference to that defined document as amended, supplemented or
novated from time to time.
2. PLEDGE
2.1 PLEDGED SHARES
(a) The Pledgor is one of two shareholders of the Company.
(b) The total registered share capital (Stammkapital) of the Company
amounts to EUR 155,000 (in words: one hundred fifty-five thousand).
At present, the Pledgor holds two shares (Geschaftsanteile) in the
Company in the amount of EUR 7,750 each (the EXISTING SHARES). The
other share in the Company in the amount of EUR 139,500 is held by
Solutia Europe SA/NV.
(c) The Existing Shares are fully paid up. There is no obligation for
the Pledgor to make additional contributions.
2.2 CONSTITUTION OF PLEDGE
(a) The Pledgor hereby pledges the Shares to the Pledgee.
(b) The Pledgee hereby accepts the Pledge.
(c) Pursuant to Section 8 of the Company's articles of association the
entering of the Pledgor into this Agreement requires the consent of
the shareholders meeting (Gesellschafterversammlung) of the
Company. Such consent has been granted; a faxed copy of the consent
is attached hereto as Schedule 1.
3. INDEPENDENT PLEDGES
The validity and effect of each of the Pledges shall be independent
from the validity and the effect of any of the other Pledges
created hereunder and is in addition, and without any prejudice, to
any other security which the Pledgee may now or hereafter hold in
respect of the Secured Claims. Each Pledge to the Pledgee shall be
a separate and individual pledge. Each of the Pledges shall rank
pari passu in priority to each other Pledge created hereunder.
4. SECURITY PURPOSE
The Pledge is constituted in order to secure the prompt and
complete payment and discharge of any and all Secured Claims.
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5. DIVIDENDS
5.1 EXTENT OF THE PLEDGE
The Pledge constituted by this Agreement includes the present and
future rights to receive:
(a) dividends, if any, payable on the Shares;
(b) liquidation proceeds, consideration for redemption
(Einziehungsentgelt), repaid capital in case of a capital
decrease, any compensation in case of termination
(Kundigung) and/or withdrawal (Austritt) of a shareholder
of the Company, the surplus in case of surrender
(Preisgabe) and all other pecuniary claims associated with
the Shares; and
(c) the right to subscribe for newly issued shares associated
with the Shares.
5.2 DIVIDENDS IN CASH
Notwithstanding that the dividends are pledged hereunder, the
Pledgor shall be entitled to receive and retain all dividends in
cash in respect of the Shares until the occurrence of a Declared
Default.
5.3 DISTRIBUTIONS OTHER THAN DIVIDENDS IN CASH
(a) Distributions other than dividends in cash, including payments in
respect of rights pledged under Clause 5.1(b) above shall be, and
shall forthwith be, delivered to the Pledgee to be held as security
and shall, if received by the Pledgor, be received as holder for
the Pledgee and segregated from the other property or funds of the
Pledgor and be forthwith delivered to the Pledgee as security in
the same form as so received (with any necessary endorsement).
(b) Any further reaching obligations of the Company and/or the Pledgor
in respect of rights pledged under Clause 5.1 above shall not be
affected by this Clause 5.3.
6. EXERCISE OF VOTING RIGHTS
6.1 VOTING RIGHTS
The voting rights, if any, resulting from the Shares remain at all
times with the Pledgor. The Pledgor, however, shall at all times
until the full satisfaction of all Secured Claims or the release of
this Pledge be required, in exercising its voting rights, to act in
good faith to ensure that the validity and enforceability of the
Pledge is not in any way adversely affected.
6.2 IMPAIRMENT
The Pledgor shall not take, or participate in, any action which
impairs, or which would for any other reason be inconsistent with,
the security interest of the Pledgee or the security purpose as
described in Clause 4 hereof or which would defeat, impair or
circumvent the rights of the Pledgee hereunder in each case in any
respect.
6.3 INFORMATION BY THE PLEDGOR
The Pledgor shall inform the Pledgee without undue delay
(unverzuglich) of all other actions concerning the Company which
might adversely affect the security interest of the Pledgee. In
particular, the Pledgor shall notify the Pledgee forthwith of any
shareholders' meeting of
5
which it becomes aware at which a resolution is intended to be
adopted which could be expected to have a material adverse effect
upon the Pledge. In any event the Pledgee shall without undue delay
(unverzuglich) receive, as soon as they are available, a copy of
the convocation notice for such ordinary or extraordinary
shareholders' meeting of which the Pledgor becomes aware setting
forth the agenda and all applications and decisions to be taken,
and, after the meeting, the minutes of any such shareholders'
meeting.
7. ENFORCEMENT OF PLEDGE
7.1 PLEDGEE'S RIGHTS
(a) Upon the occurrence of a Declared Default, and if and when the
requirements set forth in Sections 1273, 1204 et seq. of the
German Civil Code (Burgerliches Gesetzbuch) with regard to the
enforcement of pledges are met (Pfandreife), the Pledgee may
enforce the Pledge (or any part thereof) by way of public auction
(offentliche Versteigerung) or in any other way permitted under
German law, in all cases notwithstanding Section 1277 of the German
Civil Code without any enforceable judgment or other instrument
(vollstreckbarer Titel).
(b) The Pledgee shall notify the Pledgor of the intention to realise
the Pledge over the Shares not less than 5 (five) Business Days
before the date on which the Pledge is intended to be realised. The
Pledgor expressly agrees that in the event of a realisation by way
of public auction 5 (five) Business Days prior written notice of
the place and time of any such public auction shall be sufficient.
Such notice period is not necessary if the Pledgor has generally
ceased to make payments or insolvency proceedings have been
commenced against the Pledgor. The public auction may be held at
any place in Germany which will be determined by the Pledgee.
(c) If the Pledgee should seek to enforce the Pledge pursuant to, and
in accordance with Clause 7.1(a) above, the Pledgor shall, at his
own expense, render forthwith all assistance necessary in order to
facilitate the prompt sale of the Shares or any part thereof and/or
the exercise by the Pledgee of any other right the Pledgee may have
in accordance with the terms of this Agreement and under German
law.
(d) The Pledge will be realised to the extent necessary to discharge in
full the Secured Claims. The Pledgee shall at all times until the
full and complete payment and discharge of all the Secured Claims
in exercising its rights under this Agreement take into
consideration the legitimate interests of the Pledgor.
(e) In deviation of Section 1225 of the German Civil Code in case of
enforcement of the Pledge, no rights of the Pledgee shall pass to
the Pledgor by subrogation or otherwise unless and until all of the
Secured Claims have been paid and discharged in full. Until then,
the Pledgee shall be entitled to treat all enforcement proceeds as
additional collateral for the Secured Claims, notwithstanding its
right to seek satisfaction from such proceeds at any time.
(f) After the complete, unconditional, irrevocable and full payment and
discharge of all Secured Claims any remaining proceeds or rights
resulting from the enforcement of the Pledge (or part thereof)
shall be transferred or assigned to the Pledgor at the cost and
expense of the Pledgor.
7.2 DIVIDENDS AND ANCILLARY RIGHTS
Provided that the requirements for enforcement referred to under
Clause 7.1(a) above are met, all dividends and other payments, if
any, which have been or will be made to the Pledgor and, as the
case may be, all payments based on similar ancillary rights
attributed to the Shares may
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be applied by the Pledgee in accordance with Clause 7.3
notwithstanding the Pledgee's right to treat such payments as
additional collateral.
7.3 APPLICATION OF PROCEEDS
The proceeds resulting from the enforcement of the Pledge shall be
applied by the Pledgee in accordance with the terms of the
Collateral Agency Agreement.
8. MAINTENANCE OF LIABLE CAPITAL
(a) The enforcement of this Agreement shall be, at the date hereof and
at any time hereafter, insofar as Sections 30, 31 of the German
Limited Liabilities Companies Act (GmbH-Gesetz) are applicable to
the enforcement of pledges over own shares, limited to an amount
equal to the net assets of the Pledgor, which are calculated as the
Pledgor 's total assets (the calculation of which shall take into
account the captions reflected in Section 266 (2) A, B and C of the
German Commercial Code (Handelsgesetzbuch)) less its liabilities
(the calculation of which shall take into account the captions
reflected in Section 266 (3) B, C and D of the German Commercial
Code) less its reserves for own shares (Section 266 (3) A III. 2.
of the German Commercial Code) less its registered share capital
(Stammkapital) (the NET ASSETS).
(b) For the purposes of calculating the Net Assets the balance sheet
shall be adjusted in a way that (i) any amounts which the Pledgor
has received from funds from the issuance of the Notes which have
been on-lent by the Issuer to the Pledgor and are still outstanding
at the time of the enforcement of this Agreement shall be
disregarded or (ii) the amount of any increase of the Pledgor's
registered share capital out of retained earnings (Kapitalerhohung
aus Gesellschaftsmitteln) after the date of this Agreement that has
been effected without the prior written consent of the Pledgee
shall be deducted from the Pledgor's registered share capital.
(c) Furthermore, the Pledgor shall, in a situation where
(i) it does not have sufficient assets to maintain its
registered share capital; and
(ii) the Pledgee would (but for this Clause) be entitled and is
seeking to enforce the security granted under this
Agreement,
realise any and all of its assets that are shown in the balance
sheet with a book value (Buchwert) which is significantly lower
than the market value of such assets, provided such asset is not
necessary for the Pledgor's business (betriebsnotwendig).
(d) For the purpose of the calculation of the Net Assets and thus the
enforceable amount, the Pledgor will deliver within 30 Business
Days after the notification by the Pledgee of a Payment Default, to
the Pledgee an up to date balance sheet drawn-up by its auditors or
any other reputable firm of auditors together with a determination
of the Net Assets by the respective auditors. The balance sheet and
determination of Net Assets shall be prepared in accordance with
accounting principles pursuant to the German Commercial Code
(Handelsgesetzbuch) and be based on the same principles that were
applied when establishing the previous year's balance sheet.
(e) Should the Pledgor fail to deliver such balance sheet and/or
determination of the Net Assets within the 30 Business Day period
referred to above or if the Pledgor has generally ceased to make
payments or upon filing of an application for insolvency
proceedings by the Pledgor, the Pledgee shall be entitled to
enforce security granted under this Agreement, without the
enforcement limitations provided for above applying at the time of
such enforcement, but is
7
obliged to retransfer proceeds from such enforcement to the extent
that the Pledgor demonstrates in reasonable detail that the
enforcement of this Agreement violated the rules on preservation of
the stated share capital under Sections 30, 31 GmbH-Act as set out
in paragraph (a)-(c) above by resulting or enhancing negative
assets (Unterbilanz) of the Pledgor.
(f) This Agreement shall further not be enforced to the extent that the
Pledgor demonstrates in reasonable detail that such enforcement
would lead to a breach of the Gebot der Rucksichtnahme auf die
Eigenbelange der Gesellschaft (duty of care owing by the relevant
shareholders vis-a-vis the respective company) and of the Verbot
des existenzvernichtenden Eingriffs (prohibition of
insolvency-causing intervention), as developed by the recent
jurisdiction (in particular BGH II ZR 000/00 "Xxxxxx Xxxxxx", XXX
XX 000/00 and BGH II ZR 300/00 "KBV"), of the Federal Supreme Court
(Bundesgerichtshof), caused for example, as far as this would be
within the scope of the cited court rulings, if the entering into
this Agreement and its enforcement results in the illiquidity
(Zahlungsunfahigkeit) of the Pledgor. The Pledgee shall be obliged
to retransfer proceeds from such enforcement to the extent that the
Pledgor demonstrates in reasonable detail that the enforcement of
this Agreement violated the rules of the cited Federal Supreme
Court rulings. Otherwise, any claim for damages to the Pledgee
(excluding, for the avoidance of doubt, any claim relating to
unjust enrichment) by the Pledgor, any shareholders of the Pledgor
or its managing directors shall be excluded.
(g) Notwithstanding paragraph (a)-(f) above the Pledgee shall be
entitled to immediate enforcement of the security granted under
this Agreement, if and to the extent the Pledgee has already made a
claim under the German Subsidiary Guaranty and the enforcement of
the German Subsidiary Guaranty was not excluded pursuant to its
maintenance of capital rules, but is obliged to retransfer proceeds
from such enforcement of the security granted under this Agreement
in accordance with paragraphs (e) and (f) above.
9. UNDERTAKINGS OF THE PLEDGOR
9.1 UNDERTAKINGS
The Pledgor undertakes:
(a) not to dispose of the Shares or any interest therein and
not to create or agree to any other security interest or
third party right in or over the shares without prior
written consent by the Pledgee;
(b) to notify the Pledgee without undue delay of any event or
circumstance which might be expected to have a material
adverse effect on the security interest granted hereunder
and not to take any steps which may have such effect;
(c) at its own expense, to execute and do all such assurances,
acts and things as the Pledgee may reasonably require:
(i) for perfecting or protecting the security
intended to be afforded by this Agreement; and
(ii) if the Pledge has become enforceable, for
facilitating the realisation of all or any part
of the Shares which are subject to this Agreement
and the exercise of all powers, authorities and
discretions vested in the Pledgee or in any
receiver of all or any part of those Shares;
(d) at the Pledgee's reasonable request containing the
confirmation to maintain confidentiality for information
which is confidential, within reasonable time to
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furnish to the Pledgee such information concerning the
Shares as is available to the Pledgor, to permit the
Pledgee and its designees to inspect, audit and make
copies of and extracts from all records and all other
papers in the possession of the Pledgor which pertain to
the Shares at all times during normal business hours, and,
upon the reasonable request of the Pledgee, to deliver to
the Pledgee copies of all such records and papers;
(e) to refrain from any acts or omissions which results in the
Shares ceasing to exist in full or in part; and
(f) all Future Shares will be fully paid and that there will
be no obligation to make additional contributions in
relation to the Future Shares.
9.2 PLEDGE OVER ALL SHARES
The Pledgee may at all times request from the Pledgor to hold a
pledge over all Shares held by the Pledgor (and in the case of a
merger an equivalent security interest over the shares in the
surviving or, as the case may be, the new company) in accordance
with all terms of this Agreement.
10. REPRESENTATIONS AND WARRANTIES
Without prejudice and in addition to the representations and
warranties of the Pledgor under any of the Credit Documents to
which the Pledgor is party, the Pledgor represents and warrants to
the Pledgee that at the date hereof:
(a) it is validly existing and neither insolvent nor subject
to any insolvency proceedings nor in a financial crisis
(Xxxxx);
(b) it is not subject to any restriction of any kind with
regard to the transfer of, or the granting of a pledge in,
or any other disposal of, the Existing Shares except for
the consent requirements stipulated in Section 8 of the
Company's articles of association;
(c) it is the owner (Eigentumer) of the Existing Shares;
(d) all necessary corporate action has been taken to authorise
the entry into this Agreement;
(e) the Existing Shares are fully paid up, there is no
obligation to make additional contributions in relation to
the Existing Shares, and the Existing Shares have not been
repaid;
(f) the Existing Shares have not been transferred to or
encumbered for the benefit of any third person; and
(g) when acquiring the Existing Shares, it has complied with
the requirements set forth in Section 33 (2) of the German
Limited Liabilities Companies Act (GmbH-Gesetz).
11. WAIVER
(a) The Pledgor hereby irrevocably waives its rights of revocation
(Anfechtbarkeit) and set-off (Aufrechenbarkeit) it may have
pursuant to Sections 1211 and 770(1) and (2) of the German Civil
Code.
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(b) The Pledgor hereby irrevocably waives any rights which may pass to
the Pledgor by subrogation or otherwise, including, but not limited
to, any recourse claims against any third party (Verzicht auf
Ruckgriffsanspruche) which it may obtain (i) in the event that the
Pledgor repays any debt of any Credit Party under any of the Credit
Documents, or (ii) in the event of enforcement of the Pledge.
12. INDEMNITY
12.1 LIABILITY FOR DAMAGES
The Pledgee shall not be liable for any loss or damage suffered by
the Pledgor save in respect of such loss or damage which is
suffered as a result of the gross negligence or wilful misconduct
of the Pledgee.
12.2 INDEMNIFICATION
The Pledgor will indemnify the Pledgee against any losses, actions,
claims, expenses, demands and liabilities which may be reasonably
incurred by or made against the Pledgee for anything done or
omitted in the exercise or purported exercise of the powers
contained herein and occasioned by any breach of the Pledgor of any
of its obligations or undertakings herein contained other than to
the extent that such losses, actions, claims, expenses, demands and
liabilities are incurred or made against the Pledgee as a result of
the gross negligence or wilful misconduct of the Pledgee.
13. DURATION
13.1 DURATION
This Agreement shall remain in full force and effect until the
earlier of (a) the date upon which all Secured Claims have been
irrevocably paid and discharged in full; and (b) the date notified
by the Pledgee to the Pledgor. The Pledge shall not cease to exist
if any payments made in satisfaction of the Secured Claims have
only temporarily discharged the Secured Claims.
13.2 CONTINUING SECURITY
This Agreement shall create a continuing security and no change or
amendment whatsoever in the documents from which the Secured Claims
arise or in any document or agreement related thereto nor any
release of Security shall affect the validity or scope of this
Agreement.
14. COSTS AND EXPENSES
The Pledgor shall on demand pay (or procure payment) to the Pledgee
all expenses that the Pledgee may incur in connection with (i) the
administration of this Agreement as further provided in the
Collateral Agency Agreement, (ii) the custody or preservation of,
or the sale of, collection from, or other realisation upon, any of
the Shares, (iii) the exercise or enforcement of any of the rights
of the Pledgee hereunder, or (iv) the failure by the Pledgor to
perform or observe any of the provisions hereof. The Pledgor shall
on demand pay (or procure payment) to the Pledgee the amount of all
other costs, charges, fees and expenses (including fees for legal
advisers) reasonably and properly incurred by the Pledgee in
connection with the preparation, execution, performance and
amendment of this Agreement, or any waiver in relation thereto,
together in each case with any applicable value added tax or other
taxes. Any notarial fees and expenses incurred in connection with
this Agreement shall be borne by the Pledgor.
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15. MISCELLANEOUS
15.1 AMENDMENTS
Changes to and amendments of this Agreement including this Clause
15.1 must be made in writing and, to the extent required by law, in
notarial form.
15.2 WAIVERS AND REMEDIES CUMULATIVE
The rights of the Pledgee under this Agreement:
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of its rights or remedies
provided by law;
(c) may be waived only in writing and specifically.
Delay in exercising, partial exercising or non-exercising of any
rights is not a waiver of that right.
16. SEVERABILITY
(a) If a term of this Agreement is or becomes illegal, invalid or
unenforceable, that will not affect the legality, validity or
enforceability of any other terms of this Agreement.
(b) The illegal, invalid or unenforceable term shall be deemed to be
replaced by that term which best meets the intent of the replaced
term.
(c) In particular the Pledge shall not be affected even if the number
or nominal value of the Existing Shares or the aggregate liable
capital of the Company as stated in Clause 2.1(b) are inaccurate
and deviate from the actual facts.
17. CONFIRMATION OF RELEASE
Upon complete payment and discharge of all Secured Claims the
Pledgee shall confirm as a matter of record to the Pledgor upon its
request that the Shares are released from the Pledge.
18. NOTICES
18.1 NOTICES
Any notice or other communication under or in connection with this
Agreement to the Pledgor or the Pledgee must be in writing and
shall be delivered personally, by post or facsimile and shall be
sent to the address or facsimile number of the party, and for the
attention of the individual, as set forth in Schedule 2 hereto or
such other address or facsimile number as is notified by that party
for this purpose to the Pledgee from time to time.
18.2 LANGUAGE
Unless otherwise agreed, any notice or other communication under or
in connection with this Agreement shall be in the English language
or, if in any other language, accompanied by a translation into
English. In the event of any conflict between the English text of
this Agreement, any notice or other communication and the text in
any other language, the
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English text shall prevail except that where a German translation
of a legal term appears in such text, the German translation shall
prevail.
18.3 DELIVERY
Any communication made by one Party to another under or in
connection with this Agreement will only be effective:
(a) if by way of facsimile, when received in legible form; or
(b) if by way of letter, when it has been left at the relevant
address with acknowledgement of receipt or when it has
been delivered to the addressee by registered mail;
and, if a particular department or officer is specified as part of
its address details, if addressed to that department or officer.
19. GOVERNING LAW
This Agreement is governed by the laws of Germany.
20. JURISDICTION
(a) The courts of Frankfurt am Main, Germany, have exclusive
jurisdiction to settle any dispute in connection with this
Agreement.
(b) The Pledgee may also take legal action against the Pledgor before
any other competent court of law having jurisdiction over the
Pledgor.
21. NOTIFICATION
The Pledgor and the Pledgee instruct and authorise the undersigned
notary public to notify the Company of the Pledge pursuant to, and
in accordance with, Section 1280 of the German Civil Code
(Burgerliches Gesetzbuch) and Section 16 of the German Limited
Liabilities Companies Act (GmbH-Gesetz) by sending a certified copy
of this Agreement to the Company by registered mail (return receipt
requested).
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