Exhibit 4.6
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PLEDGE AND SECURITY AGREEMENT
dated as of July 2, 2001
among
MISSION ENERGY HOLDING COMPANY,
As Pledgor,
▇▇▇▇▇▇▇ ▇▇▇▇▇ CREDIT PARTNERS L.P.,
As Administrative Agent under the Credit Agreement,
WILMINGTON TRUST COMPANY,
As Trustee under the Indenture,
and
WILMINGTON TRUST COMPANY,
As Joint Collateral Agent
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TABLE OF CONTENTS
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Page
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Section 1. Definitions.................................................................. 2
Section 2. Representations and Warranties............................................... 4
Section 3. The Pledge................................................................... 6
Section 4. Further Assurances; Remedies................................................. 7
4.01. Delivery and Other Perfection................................................ 7
4.02. Other Financing Statements and Liens......................................... 9
4.03. Voting Rights; Dividends; Etc................................................ 9
4.04. Remedies upon Notice of Acceleration......................................... 11
4.05. Retention of Collateral...................................................... 13
4.06. Notice of Acceleration....................................................... 14
4.07. Deficiency................................................................... 14
4.08. Maintenance of Books and Records; Change of Name............................. 15
4.09. Application of Proceeds...................................................... 15
4.10. Attorney-in-Fact............................................................. 16
4.11. Termination; Release and Reinstatement of Collateral......................... 18
4.12. Performance by the Joint Collateral Agent of Pledgor's Obligations........... 19
4.13. The Joint Collateral Agent's Duty of Care.................................... 19
Section 5. The Joint Collateral Agent................................................... 20
5.01. Appointment, Powers and Immunities........................................... 20
5.02. Instructions of the Administrative Agent and/or the Trustee.................. 21
5.03. Reliance by Joint Collateral Agent........................................... 22
5.04. Rights in Other Capacities................................................... 23
5.05. Non-Reliance on Joint Collateral Agent....................................... 23
5.06. Failure to Act............................................................... 24
5.07. Right to Appoint Joint Collateral Agent or Advisor........................... 25
5.08. Resignation and Removal...................................................... 25
5.09. Qualification................................................................ 25
Section 6. Miscellaneous................................................................ 26
6.01. No Waiver.................................................................... 26
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Page
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6.02. Governing Law; Submission to Jurisdiction; Venue............................. 26
6.03. Waiver of Jury Trial......................................................... 27
6.04. Notices...................................................................... 27
6.05. Continuing Agreement......................................................... 27
6.06. Waivers, Amendments, Etc..................................................... 28
6.07. Successors and Assigns....................................................... 29
6.08. Counterparts................................................................. 29
6.09. Severability................................................................. 30
6.10. Entirety..................................................................... 30
6.11. Survival..................................................................... 30
6.12. Expenses, Indemnity, Etc..................................................... 30
6.13. Trust Indenture Act.......................................................... 31
6.14. Security Interest Absolute................................................... 32
6.15. Headings..................................................................... 32
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PLEDGE AND SECURITY AGREEMENT
THIS PLEDGE AND SECURITY AGREEMENT (this "Agreement"), dated as of
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July 2, 2001, is by and among Mission Energy Holding Company, a Delaware
corporation (the "Pledgor"), Wilmington Trust Company, as trustee under the
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Indenture (as hereinafter defined) (in such capacity, together with its
successors in such capacity, the "Trustee"), ▇▇▇▇▇▇▇ ▇▇▇▇▇ Credit Partners L.P.,
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as administrative agent on behalf of and for the benefit of the Term Loan
Secured Parties under and as defined in the Credit Agreement (as hereinafter
defined) (in such capacity, together with its successors in such capacity, the
"Administrative Agent"), and Wilmington Trust Company, as joint collateral agent
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(in such capacity, together with its successors in such capacity, the "Joint
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Collateral Agent"). Capitalized terms used herein but not otherwise defined have
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the meanings assigned to them in the Indenture.
WITNESSETH:
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WHEREAS, the Pledgor and the Trustee have entered into an Indenture
(as hereinafter defined), pursuant to which the Pledgor is authorized to issue
up to $900,000,000 aggregate principal amount of its 13.50% Senior Secured Notes
due 2008 (as amended, supplemented and exchanged from time to time,
collectively, the "Securities");
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WHEREAS, the Pledgor has entered into a Credit Agreement (as
hereinafter defined) with the lenders from time to time party thereto (the
"Lenders") pursuant to which the Pledgor is concurrently borrowing $385,000,000
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(the "Term Loans") and the Administrative Agent will act on behalf and for the
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benefit of the Term Loan Secured Parties, including entering into this
Agreement; and
WHEREAS, to induce potential purchasers of the Securities to purchase
the same and to induce the Lenders to make the Term Loans, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Pledgor has agreed to pledge, and grant a first priority
security interest in, the Collateral (as defined in Section 3 hereof) to the
Joint Collateral Agent for the benefit of the Administrative Agent (on behalf of
each Agent, the Loan Escrow Agent, the Lenders and the Lender Counterparties, as
provided in the Credit Agreement) and the Trustee (on behalf of itself as
Trustee and Paying Agent and on behalf of the holders of the Securities (the
"Holders") as provided in the Indenture), as security for the Joint Secured
Obligations (as defined in Section 1 hereof).
NOW, THEREFORE, in consideration of the premises and mutual covenants
and agreements herein contained, the parties hereto agree as follows for the
express benefit of the Administrative Agent and the Trustee:
Section 1. Definitions. Terms used but not otherwise defined herein
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shall have the meanings provided in the Indenture. As used herein:
"Code" shall mean, unless otherwise specified, the Uniform Commercial
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Code as in effect from time to time in the State of New York (provided, however,
in the event that, by reason of mandatory provisions of law, any or all of the
perfection or priority of the security interest in any Collateral is governed by
the Uniform Commercial code as in effect in a jurisdiction other than the State
of New York, the term "Code" shall mean the Uniform Commercial Code as in effect
in such other jurisdiction for purposes of the provisions hereof relating to
such perfection or priority and for purposes of definitions related to such
provisions), and any reference to any section of the Code herein shall be a
reference to such section as it is modified and amended from time to time and to
any successor section.
"Collateral" shall have the meaning ascribed thereto in Section 3
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hereof.
"Credit Agreement" shall mean the Credit Agreement, dated as of July
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2, 2001, among the Pledgor, the Administrative Agent, the other agents listed on
the signature pages thereto and the Lenders, as modified and supplemented and in
effect from time to time.
"Debt Documents" shall mean the Indenture, the Securities, the Credit
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Agreement and all term loan notes under the Credit Agreement.
"Indenture" shall mean the Indenture, dated as of July 2, 2001,
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between Pledgor and the Trustee, as modified and supplemented and in effect from
time to time.
"Issuer" shall mean Edison Mission Energy, a California corporation.
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"Joint Secured Obligations" shall mean: (i) the principal of, premium,
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if any, interest on and Liquidated Damages, if any, on the Securities and all
other amounts from time to time owing to the Holders thereof or the Joint
Collateral Agent, Trustee and Paying Agent by the Pledgor under the Indenture
and hereunder and (ii) the principal of, premium, if any, and interest on the
Term Loans and any amounts owing to a Lender or Lender Counterparty (as defined
in the Credit Agreement) under a Hedge Agreement (as defined in the Credit
Agreement) and all other amounts from time to time owing to the Lenders and
Agents (as defined in the Credit Agreement) by the Pledgor under the Credit
Agreement and hereunder.
"Joint Secured Parties" shall mean the Administrative Agent (on behalf
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of each Agent, the Loan Escrow Agent, the Lenders and the Lender Counterparties
as provided in the Credit Agreement), the Trustee (on behalf of itself as
Trustee and Paying Agent and on behalf of the holders of the Securities (the
"Holders") as provided in the Indenture) and the Joint Collateral Agent.
"Lenders" shall have the meaning ascribed to it in the second recital
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of this Agreement.
"Notice of Acceleration" shall mean a notice delivered to the Joint
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Collateral Agent by: (i) the Trustee certifying to the Joint Collateral Agent
that an acceleration of the Securities has occurred in accordance with the terms
of the Indenture and directing the Joint Collateral Agent to deliver a Notice of
Acceleration and to commence enforcement proceedings against the Pledgor or (ii)
the Administrative Agent, certifying to the Joint Collateral Agent that an
acceleration of the Term Loans has occurred in accordance with the terms of the
Credit Agreement and directing the Joint Collateral Agent to commence
enforcement proceedings against the Pledgor.
"Parity Pro Rata Basis" shall mean, with respect to any payment to
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both Holders and Lenders, on an equal basis without preference or priority of
any kind, based on each Holder's or Lender's respective percentage of the
aggregate principal amount of the Securities and Term Loans outstanding
immediately prior to such payment.
"Pledged Shares" shall have the meaning ascribed thereto in Section
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3(a) hereof.
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"Refinancing Indebtedness" means any indebtedness of Pledgor the
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proceeds of which are used to (a)refinance, in whole but not in part, the Term
Loans or (b)refinance, defease and/or satisfy and discharge the Securities, in
whole but not in part, and the Pledgor's obligations under the Indenture;
provided, however, that such indebtedness shall be "Refinancing Indebtedness"
only if it satisfies the requirements set forth in clauses (1) and (2) for
"Permitted Refinancing Indebtedness" as such term is defined in (i) the Credit
Agreement in the case of a refinancing of the Securities or (ii) the Indenture
in the case of a refinancing of the Term Loans.
"Required Secured Parties" shall mean a majority of the aggregate
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principal amount of the Securities and Term Loans then outstanding.
"Securities" shall have the meaning ascribed to it in the first
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recital of this Agreement.
"Term Loans" shall have the meaning ascribed to it in the second
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recital of this Agreement.
"Termination Event" shall mean the occurrence of (a) both (i) the
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satisfaction and discharge of the Indenture as provided by Section 401 thereof,
or the satisfaction, discharge and defeasance of the Securities pursuant to
Article Twelve of the Indenture and (ii) the termination of the Term Loan
Commitments (as defined in the Credit Agreement) and satisfaction and discharge
of the Obligations (as defined in the Credit Agreement) in accordance with the
terms set forth therein or (b) the release of the Collateral pursuant to and in
accordance with the terms of the Debt Documents.
Section 2. Representations and Warranties. The Pledgor represents
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and warrants to the Joint Collateral Agent that:
(a) The Pledgor is the sole beneficial owner of the Collateral in
which it purports to grant a security interest pursuant to Section 3 hereof, and
no Lien exists upon such Collateral (and no right or option to acquire the same
exists in favor of any other Person), except for the pledge and security
interest in favor of the Joint Collateral Agent for the benefit of the Joint
Secured Parties created or provided for herein. There exist no "adverse claims"
within the meaning of Section 8-302 of the Code with respect to the Pledged
Shares.
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(b) The Pledged Shares evidenced by the certificate identified in
Annex A hereto are duly authorized, validly issued, fully paid and non-
assessable and none of such Pledged Shares is subject to any contractual
restriction or any restriction under the charter documents of the Pledgor or the
Issuer (including, but not limited to, preemptive rights) prohibiting or
limiting the transfer of such Pledged Shares (except for any such restriction
contained herein or in any Debt Document).
(c) The Pledged Shares evidenced by the certificate identified in
Annex A hereto constitute all of the issued and outstanding shares of capital
stock of the Issuer and there are no preemptive rights, options, warrants,
convertible securities or other agreements or commitments of any character
obligating the Pledgor or the Issuer to issue, transfer or sell any of the
Issuer's capital stock or other equity interests, or any agreements,
arrangements, or understandings granting any person any rights in the Issuer
similar to capital stock or other equity interests.
(d) None of the execution and delivery of this Agreement, the
consummation of the transactions herein contemplated or the compliance with the
terms and provisions hereof will conflict with or result in (i) a breach or
violation of any of the terms or provisions of, or constitute a default under,
any material indenture, mortgage, deed of trust, sale/leaseback agreement, loan
agreement or other similar financing agreement or instrument or other agreement
or instrument to which the Pledgor or any of its subsidiaries is a party or by
which the Pledgor or any of its subsidiaries is bound or to which any of the
property or assets of the Pledgor or any of its subsidiaries is subject, other
than with respect to change in control provisions contained in agreements and
instruments with respect to the indebtedness of the Issuer and its subsidiaries,
(ii) any violation of the provisions of the Amended and Restated Certificate of
Incorporation or By-laws of the Pledgor or (iii) any violation of any statute or
any order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Pledgor or any of its subsidiaries or any of their
properties, except, in case of clauses (i) and (ii) above for any breaches or
violations that would not have, individually or in the aggregate, a material
adverse effect on the condition (financial or other), business properties or
results of operations of the Pledgor and its subsidiaries, taken as a whole, or
on the ability of the Pledgor to perform its
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obligations hereunder; and no consent, approval, authorization, order,
registration, notice, filing or qualification of or with any such court or
governmental agency or body is required either (x) for the execution and
delivery of this Agreement, the consummation of the transactions herein
contemplated or the compliance with the terms and provisions hereof on the date
hereof or (y) for the exercise by the Joint Collateral Agent of its rights and
remedies hereunder (in each case, except as may be required by the Code in the
applicable jurisdiction, by the Federal Energy Regulatory Commission, by laws
affecting the offering and sale of securities or by merger control laws and
regulations).
(e) This Agreement creates a valid first priority security interest
in the Collateral in favor of the Joint Collateral Agent for the benefit of the
Joint Secured Parties. Upon delivery to the Joint Collateral Agent for the
benefit of the Joint Secured Parties of the certificate identified in Annex A
with undated stock powers duly endorsed in blank by an effective endorsement and
the filing of a financing statement covering the capital stock represented
thereby, no further action will be necessary to perfect or otherwise protect
such security interest in such Collateral.
Section 3. The Pledge. As collateral security for the prompt payment
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in full when due (whether at stated maturity, by acceleration or otherwise) of
the Joint Secured Obligations, the Pledgor hereby pledges, grants and assigns to
the Joint Collateral Agent for the benefit of the Joint Secured Parties to the
extent and subject to the restric tions hereinafter provided, a continuing first
priority security interest in any and all of the Pledgor's right, title and
interest in the following property, whether now owned or hereafter acquired and
whether now existing or hereafter coming into existence (all being collectively
referred to herein as "Collateral"):
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(a) all of the issued and outstanding shares of capital stock of the
Issuer evidenced by the certificate identified in Annex A hereto under the name
of the Pledgor and all other shares of capital stock of whatever class of the
Issuer, now or hereafter issued, in each case together with the certificates
representing such shares, and all options and other rights, contractual or
otherwise, with respect thereto (collectively, the "Pledged Shares"), including,
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but not limited to, (A) all shares, securities, moneys or property representing
a dividend on any of the
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Pledged Shares, or representing a distribution or return of capital upon or in
respect to the Pledged Shares, or resulting from a stock split, revision,
reclassification or other like change of the Pledged Shares, or otherwise
received in exchange therefor, and any subscriptions, warrants, rights or
options issued to the holders of, or otherwise in respect of, the Pledged
Shares; and (B) without affecting the obligations of the Pledgor under any
provision prohibiting such action hereunder or under the Debt Documents, in the
event of any consolidation or merger in which the Issuer is not the surviving
corporation, all shares of each class of the capital stock of the successor
corporation formed by or resulting from such consolidation or merger which are
outstanding after the consummation of such consolidation or merger; and
(b) all proceeds of and to any of the property of the Pledgor
described in the preceding clause of this Section 3, however and whenever
acquired and in whatever form.
Section 4. Further Assurances; Remedies. In furtherance of the grant
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of the pledge and security interest pursuant to Section 3 hereof, the Pledgor
hereby agrees with the Joint Collateral Agent, for the benefit of the Joint
Secured Parties as follows:
4.01. Delivery and Other Perfection. The Pledgor hereby agrees
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that, for so long as any of the Joint Secured Obligations remains outstanding,
it shall:
(a) if any of the above-described shares or other property required
to be pledged by the Pledgor under clauses (a) and (b) of Section 3 hereof are
with or received by the Pledgor, promptly take such action as may be necessary
or as the Joint Collateral Agent shall reasonably request, subject to Section
5.02, to duly perfect the Lien created hereunder in such shares or other
property in said clauses (a) and (b). Where required for perfection under local
law, certificates for the shares shall be transferred and delivered to the Joint
Collateral Agent simultaneously with or prior to the execution and delivery of
this Agreement. Prior to delivery to the Joint Collateral Agent, all such
certificates and instruments constituting Collateral of the Pledgor shall be
held in trust by the Pledgor for the benefit of the Joint Collateral Agent
pursuant hereto. All such certificates shall be delivered to the Joint
Collateral Agent in suitable form for transfer by delivery or shall be
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accompanied by duly executed instruments of transfer or assignment in blank.
(b) if the Pledgor shall receive by virtue of its being or having
been the owner of any Collateral, any (i) stock certificate, including without
limitation, any certificate representing a stock dividend or distribution in
connection with any increase or reduction of capital, reclassification, merger,
consolidation, reorganization, sale of assets, combination of shares, stock
splits, spin-off or split-off, promissory notes or other instrument; (ii)
dividends payable in securities; or (iii) distributions of securities in
connection with a partial or total liquidation, dissolution or reduction of
capital, capital surplus or paid-in surplus, then the Pledgor shall receive such
stock certificate, instrument, option, right or distribution in trust for the
benefit of the Joint Collateral Agent, shall segregate it from the Pledgor's
other property and shall deliver it forthwith to the Joint Collateral Agent in
the exact form received, together with any necessary endorsement and/or
appropriate undated stock power duly executed in blank, to be held by the Joint
Collateral Agent as Collateral pursuant to the terms hereof and as further
collateral security for the Joint Secured Obligations.
(c) give, execute, deliver, file and/or record at its expense such
Code or other applicable financing statement, notice, filing, registration,
instrument, document, agreement or other papers as may be necessary or desirable
or as may be reasonably requested by the Joint Collateral Agent, subject to
Section 5.02, to create, preserve, perfect or validate the security interest
granted pursuant hereto in the Collateral of the Pledgor, or to enable the Joint
Collateral Agent to exercise and enforce its rights hereunder with respect to
such pledge and security interest, including, without limitation, if so
requested by the Joint Collateral Agent in order to exercise and enforce its
rights hereunder while a Notice of Acceleration is then in effect, causing any
or all of the Collateral to be transferred of record into the name of the Joint
Collateral Agent or its nominee (and the Joint Collateral Agent agrees that if
any Collateral is transferred into its name or the name of its nominee, the
Joint Collateral Agent will promptly give to the Pledgor copies of any notices
and communications received by it with respect to the Collateral pledged by the
Pledgor hereunder);
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(d) warrant and defend title to and ownership of the Collateral of
the Pledgor at its own expense against the claims and demands of all other
parties claiming an interest therein, keep the Collateral free from all Liens,
and not sell, exchange, transfer, assign, lease or otherwise dispose of
Collateral of the Pledgor or any interest therein (except as is not prohibited
under any Debt Document);
(e) not enter into any agreement or allow to exist any restriction
with respect to any of the Collateral of the Pledgor other than pursuant hereto
(or as is not prohibited under any Debt Document);
(f) keep full and accurate books and records relating to the
Collateral, and stamp or otherwise ▇▇▇▇ such books and records (and cause the
Issuer to ▇▇▇▇ its books and records) to reflect the security interest granted
to the Joint Collateral Agent for the benefit of the Joint Secured Parties
pursuant to this Agreement; and
(g) permit representatives of the Joint Collateral Agent, upon
reasonable notice, at any time during normal business hours to inspect and make
abstracts from its books and records pertaining to the Collateral, and while a
Notice of Acceleration is then in effect, permit representatives of the Joint
Collateral Agent to be present at the Pledgor's place of business to receive
copies of all communications and remittances relating to the Collateral, and
forward copies of any notices or communications received by the Pledgor with
respect to the Collateral, all in such manner as the Joint Collateral Agent may
reasonably require.
4.02. Other Financing Statements and Liens. The Pledgor shall not
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file or suffer to be on file, or authorize or permit to be filed or to be on
file, in any jurisdiction, any financing statement or like instrument with
respect to the Collateral in which the Joint Collateral Agent is not named as
the sole secured party for the benefit of the Joint Secured Parties.
4.03. Voting Rights; Dividends; Etc. (a) Unless a Notice of
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Acceleration shall be in effect or an Event of Default specified in Section
501(3) of the Indenture or an Event of Default specified in Section 6.1(c) of
the Credit Agreement shall have occurred and be continuing:
(1) the Pledgor shall have the right to exercise, to the extent
permitted by law, all voting, consensual and
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other powers of ownership pertaining to the Collateral or any part thereof for
all purposes not inconsistent with the terms of this Agreement or the Debt
Documents; and
(2) subject to Section 4.01(b) hereof, the Pledgor shall be entitled
to receive and retain, free from the lien created by this Agreement, any
dividends on the Collateral or other distributions paid in respect of the
Collateral to the extent they are not prohibited by the Debt Documents.
(b) If a Notice of Acceleration shall be in effect or an Event of
Default specified in Section 501(3) of the Indenture or an Event of Default
specified in Section 6.1(c) of the Credit Agreement shall have occurred and be
continuing, then:
(1) all rights of the Pledgor to exercise the voting and other
consensual rights which it would otherwise be entitled to exercise pursuant to
Section 4.03(a)(1) shall cease, and all such rights shall thereupon become
vested in the Joint Collateral Agent who shall thereupon have the sole right to
exercise such voting and other consensual rights;
(2) all rights of the Pledgor to receive the dividends and other
distributions which it would otherwise be authorized to receive and retain
pursuant to Section 4.03(a)(2) shall cease, and all such rights shall thereupon
become vested in the Joint Collateral Agent who shall thereupon have the sole
right to receive such dividends and other distributions and shall apply the same
to the Joint Secured Obligations in accordance with Section 4.09;
(3) any dividends and distributions which are received by the Pledgor
contrary to the provisions of Section 4.03(b)(2) shall be received in trust for
the benefit of the Joint Collateral Agent, shall be segregated from other
property or funds of the Pledgor and shall be forthwith paid over to the Joint
Collateral Agent as Collateral in the same form as so received (with any
necessary endorsement), to be held by the Joint Collateral Agent as Collateral
and as further collateral security for the Joint Secured Obligations; and
(4) the Pledgor shall, if necessary to permit the Joint Collateral
Agent to exercise the voting and other rights which it may be entitled to
exercise pursuant to Section 4.03(b)(1) and to receive all dividends and
distributions which it may be entitled to receive under
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Section 4.03(b)(2), execute and deliver to the Joint Collateral Agent, from time
to time and upon written notice of the Joint Collateral Agent, appropriate
dividend payment orders and other instruments as the Joint Collateral Agent may
reasonably request.
4.04. Remedies upon Notice of Acceleration. (a) If a Notice of
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Acceleration shall be in effect, then:
(1) the Joint Collateral Agent shall have, in respect of the
Collateral of the Pledgor, all of the rights and remedies with respect to the
Collateral of a secured party under the Code (whether or not, to the fullest
extent permitted by law, said Code is in effect in the jurisdiction where the
rights and remedies are asserted) and such additional rights and remedies to
which a secured party is entitled under the laws in effect in any jurisdiction
where any rights and remedies hereunder may be asserted, including, without
limitation, the right, to the maximum extent permitted by law, to exercise all
voting, consensual and other powers of ownership pertaining to the Collateral as
if the Joint Collateral Agent were the sole and absolute owner thereof (and the
Pledgor agrees to take all such action as may be appropriate to give effect to
such right);
(2) the Joint Collateral Agent may, in its name or in the name of the
Pledgor or otherwise, demand, ▇▇▇ for, collect or receive any money or property
at any time payable or receivable on account of or in exchange for any of the
Collateral, and exercise the powers described in Section 4.10(a) hereof, but
shall be under no obligation to do so;
(3) the Joint Collateral Agent may, in its sole discretion, without
notice to the Pledgor of the time and place, with respect to the Collateral or
any part thereof which shall then be or shall thereafter come into the
possession, custody or control of the Joint Collateral Agent or any agents
thereof, sell, lease, assign or otherwise dispose of all or any part of such
Collateral, at such place or places as the Joint Collateral Agent deems best,
and for cash or for credit or for future delivery or otherwise in accordance
with applicable law (without thereby assuming any credit risk), at public or
private sale, at such price or prices and on such other terms as the Joint
Collateral Agent may deem commercially reasonable, without demand of performance
or notice of intention to effect any such disposition or of the time or place
thereof (except such notice as is required by applicable statute and cannot be
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waived), and the Joint Collateral Agent, any Holder, any Lender or anyone else
may, to the extent permitted by law, be the purchaser, lessee, assignee or
recipient of any or all of the Collateral so disposed of at any public sale (or,
to the extent permitted by applicable law, at any private sale) and thereafter
hold the same absolutely, free from any claim or right of whatsoever kind,
including any right or equity of redemption (statutory or otherwise), of the
Pledgor, any such demand, notice and right or equity being hereby expressly
waived and released. The Pledgor agrees that, to the extent notice of sale
shall be required by law and has not been waived by it, any requirement of
reasonable notice shall be met if notice, specifying the place of any public
sale or the time after which any private sale is to be made, is personally
served on or mailed, postage prepaid, to the Pledgor, in accordance with the
notice provisions of Section 6.04 hereof at least ten (10) days before the time
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of such sale. The Joint Collateral Agent shall not be obligated to make any
sale of Collateral of the Pledgor regardless of notice of sale having been
given. The Joint Collateral Agent may, without notice or publication and, to
the extent permitted under applicable law, adjourn any public or private sale or
cause the same to be adjourned from time to time by announcement at the time and
place fixed for the sale, and such sale may, without further notice, be made at
any time or place to which the sale may be so adjourned;
(4) the Pledgor recognizes that the Joint Collateral Agent may deem
it impracticable to effect a public sale of all or any part of the Pledged
Shares or any of the securities constituting Collateral and that the Joint
Collateral Agent may, therefore, determine to make one or more private sales of
any such securities to a restricted group of purchasers who will be obligated to
agree, among other things, to acquire such securities for their own account, for
investment and not with a view to the distribution or resale thereof. The
Pledgor acknowledges that any such private sale may be at prices and on terms
less favorable to the seller than the prices and other terms which might have
been obtained at a public sale and, notwithstanding the foregoing, agrees that
such private sale shall be deemed to have been made in a commercially reasonable
manner and that the Joint Collateral Agent shall have no obligation to delay
sale of any such securities for the period of time necessary to permit the
issuer of such securities to register or qualify such securities for public sale
under the Securities Act of 1933 or other applicable securities laws of other
jurisdictions. The Pledgor further
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acknowledges and agrees that any offer to sell such securities which has been
(i) publicly advertised on a bona fide basis in a newspaper or other publication
of general circulation in the financial community of New York, New York (to the
extent that such offer may be advertised without prior registration under the
Securities Act of 1933) or (ii) made privately in the manner described above
shall be deemed to involve a "public sale" under the Code, notwithstanding that
such sale may not constitute a "public offering" under the Securities Act of
1933, and the Joint Collateral Agent may, in such event, bid for the purchase of
such securities; and
(5) the Joint Collateral Agent shall incur no liability as a result
of the sale of the Collateral, or any part thereof, at any private sale pursuant
to subclause (4) above conducted in a commercially reasonable manner. The
Pledgor hereby waives to the extent permitted by applicable law any claims
against the Joint Collateral Agent arising by reason of the fact that the price
at which the Collateral may have been sold at such a private sale was less than
the price which might have been obtained at a public sale or was less than the
aggregate amount of the Joint Secured Obligations, even if the Joint Collateral
Agent accepts the first offer received and does not offer the Collateral to more
than one offeree.
(b) The proceeds of each collection, sale or other disposition under
this Section 4.04 shall be applied in accordance with Section 4.09 hereof.
4.05. Retention of Collateral. In addition to the rights and
-----------------------
remedies hereunder, if a Notice of Acceleration shall be in effect, the Joint
Collateral Agent may, after providing the notices required by Section 9-505(2)
of the Code and otherwise complying with the requirements of applicable law of
the relevant jurisdiction, retain all or any portion of the Collateral in
satisfaction of the Joint Secured Obligations. Unless and until the Joint
Collateral Agent shall have provided such notices, however, the Joint Collateral
Agent shall not, except as provided under law, be deemed to have retained any
Collateral in satisfaction of any Joint Secured Obligations for any reason.
4.06. Notice of Acceleration. (a) Within three Business Days
----------------------
following receipt by the Joint Collateral Agent of a Notice of Acceleration, the
Joint Collateral Agent shall notify the Pledgor, the Trustee and
13
the Administrative Agent of the receipt of such Notice of Acceleration and the
contents thereof in writing.
(b) A Notice of Acceleration shall become effective upon receipt
thereof by the Pledgor. A Notice of Acceleration, once effective, shall remain
in effect unless and until it is cancelled as provided in Section 4.06(c).
(c) Any party giving Notice of Acceleration shall be entitled to
cancel it by delivering a written notice of cancellation to the Joint Collateral
Agent (i) before the Joint Collateral Agent takes any action to exercise any
remedy with respect to the Collateral or (ii) thereafter, if the Joint
Collateral Agent believes that all actions it has taken to exercise any remedy
or remedies with respect to the Collateral can be reversed without material
prejudice to the rights of the Pledgor, the Joint Collateral Agent or the non-
delivering party; provided, however, that a Notice of Acceleration shall be
-------- -------
deemed cancelled if: (x) such Notice of Acceleration was given by the Trustee,
the declaration of acceleration of the Securities is rescinded and annulled
pursuant to the terms of the Indenture and no Notice of Acceleration has been
given by the Administrative Agent and remains outstanding; (y) such Notice of
Acceleration was given by the Administrative Agent, the declaration of
acceleration of the Term Loans is rescinded and annulled pursuant to the terms
of the Credit Agreement and no Notice of Acceleration has been given by the
Trustee and remains outstanding; and (z) such Notice of Acceleration has been
given by both the Administrative Agent and Trustee, the declarations of
acceleration under the Credit Agreement and the Indenture are rescinded and
annulled pursuant to the terms of the Credit Agreement and the Indenture,
respectively. The Joint Collateral Agent shall notify the Pledgor in writing as
to the cancellation of any Notice of Acceleration within three Business Days
following receipt thereof.
4.07. Deficiency. In the event that the proceeds of any sale,
----------
collection or realization of or upon the Collateral pursuant to Section 4.04
hereof are insufficient to cover the costs and expenses of such realization and
the payment in full of the Joint Secured Obligations, the Pledgor shall remain
liable for the deficiency as provided under the terms of the Indenture and
Credit Agreement, together with interest thereon, in each case, as provided
therein, together with the costs of collection and the reasonable fees of any
attorneys employed by the Joint Collateral Agent to collect such deficiency.
14
4.08. Maintenance of Books and Records; Change of Name. Without
------------------------------------------------
either the prior written consent of, or at least thirty (30) days' prior written
notice to, the Joint Collateral Agent, the Pledgor shall not (i) maintain any of
its books and records with respect to the Collateral at any office, other than
that set forth opposite the Pledgor's name on Annex A hereto, or maintain its
principal place of business at any place other than at the address indicated
beneath the signature of the Pledgor to this Agreement or (ii) change its name,
or the name under which it does business, from the name shown on the signature
page hereto or (iii) change its jurisdiction of incorporation.
4.09. Application of Proceeds. (a) Except as otherwise herein
-----------------------
expressly provided, the proceeds of any collection, sale or other realization of
all or any part of the Collateral pursuant to Section 4.04 hereof, and while a
Notice of Acceleration is then in effect, any payments in respect of the Joint
Secured Obligations and any proceeds of any Collateral when received by the
Joint Collateral Agent in cash or its equivalent under this Section 4, shall be
applied by the Joint Collateral Agent as follows:
First, on a pro rata basis, to the payment of costs and expenses
(including costs and attorneys' fees) of the Joint Collateral Agent
in enforcing or exercising any rights or remedies in connection with,
or in realizing upon, the Collateral and to the payment of all other
amounts due to the Joint Collateral Agent (in its capacity as such)
hereunder;
Second, on a pro rata basis, to the payment of all amounts due (i)
under the Indenture to the Trustee and the Paying Agent (as
identified therein) and (ii) under the Credit Agreement to the Agents
(as defined therein);
Third, on a Parity Pro Rata Basis, to the payment of interest (other
than any defaulted interest) due and payable on the Securities and
Term Loans;
Fourth, on a Parity Pro Rata Basis, to the payment of the then
outstanding principal amount of Securities and Term Loans;
Fifth, on a Parity Pro Rata Basis, to the payment of (i) Liquidated
Damages, if any, with respect to the Securities, (ii) premium, if
any, with respect
15
to any principal amount of Securities or Term Loans, and (iii)
defaulted interest, if any, due and payable with respect to the
Securities or the Term Loans; and
Sixth, any surplus remaining shall be returned to the Pledgor or to
whomsoever a court of competent jurisdiction shall determine to be
entitled thereto.
As used in this Section 4, "proceeds" of Collateral shall mean cash, securities
--------
and other property realized in respect of, and distributions in kind of,
Collateral, including any thereof received under any reorganization, liquidation
or adjustment of debt of the Pledgor or the Issuer.
(b) The Pledgor hereby irrevocably waives the right to direct the
application of any payments and proceeds under this Section 4.09 and
acknowledges and agrees that the Joint Collateral Agent shall have the
continuing and exclusive right to apply and reapply any and all such payments
and proceeds in the Joint Collateral Agent's sole discretion, notwithstanding
any entry to the contrary upon any of its books and records.
(c) The provisions of this Section 4.09 shall survive the resignation
or removal of the Joint Collateral Agent.
4.10. Attorney-in-Fact. (a) Without limiting any rights or powers
----------------
otherwise granted by this Agreement to the Joint Collateral Agent, the Joint
Collateral Agent (and each of its designees) is hereby appointed the attorney-
in-fact of the Pledgor for the purpose of carrying out the provisions of this
Section 4 and taking any action and executing any instruments which the Joint
Collateral Agent may deem necessary or advisable to accomplish the purposes
hereof (which appointment as attorney-in-fact is irrevocable, for as long as the
Joint Secured Obligations remain outstanding, and coupled with an interest and
with power of substitution) including, but not limited to, the power to take any
or all of the following actions upon the occurrence and during the continuance
of a Notice of Acceleration: (i) to demand, collect, settle, compromise, adjust
and give discharges and releases concerning the Collateral of the Pledgor, all
as the Joint Collateral Agent may reasonably determine; (ii) to commence and
prosecute any actions at any court for the purposes of collecting any of the
Collateral of the Pledgor and enforcing any other right
16
in respect thereof; (iii) to defend, settle or compromise any action brought
and, in connection therewith, give such discharge or release as the Joint
Collateral Agent may deem reasonably appropriate; (iv) to pay or discharge
taxes, liens, security interests, or other encumbrances levied or placed on or
threatened against the Collateral of the Pledgor; (v) to direct any parties
liable for any payment under any of the Collateral to make payment of any and
all monies due and to become due thereunder directly to the Joint Collateral
Agent or as the Joint Collateral Agent shall direct; (vi) to receive payment of
and receipt for any and all monies, claims, and other amounts due and to become
due at any time in respect of or arising out of any Collateral of the Pledgor;
(vii) to sign and endorse any drafts, assignments, proxies, stock powers,
verifications, notices and other documents relating to the Collateral of the
Pledgor; (viii) to settle, compromise or adjust any suit, action or proceeding
described above and, in connection therewith, to give such discharges or
releases as the Joint Collateral Agent may deem reasonably appropriate; (ix) to
the extent allowed under applicable local law, execute and deliver all
assignments, conveyances, statements, financing statements, renewal financing
statements, pledge agreements, affidavits, notices and other agreements,
instruments and documents that the Joint Collateral Agent may determine
necessary in order to perfect and maintain the security interests and liens
granted in this Agreement and in order to fully consummate all of the
transactions contemplated therein; (x) to exchange any of the Collateral of the
Pledgor or other property upon any merger, consolidation, reorganization,
recapitalization or other readjustment of the issuer thereof, or upon any
transfer of the Collateral from a Pledgor to another Pledgor and, in connection
therewith, deposit any of the Collateral of the Pledgor with any committee,
depository, transfer agent, registrar or other designated agency upon such terms
as the Joint Collateral Agent may determine; (xi) to the extent allowed under
applicable local law, to vote for a shareholder resolution, or to sign an
instrument in writing, sanctioning the transfer of any or all of the Pledged
Shares of the Pledgor into the name of the Joint Collateral Agent or into the
name of any transferee to whom the Pledged Shares of the Pledgor or any part
thereof may be sold pursuant to Section 10 hereof; and (xii) to do and perform
all such other acts and things as the Joint Collateral Agent may reasonably deem
to be necessary, proper or convenient in connection with the Collateral of the
Pledgor.
17
(b) Subject to Section 5 hereof, the Joint Collateral Agent shall be
under no duty to exercise or withhold the exercise of any of the rights, powers,
privileges and options expressly or implicitly granted to the Joint Collateral
Agent in this Agreement, and shall not be liable for any failure to do so or any
delay in doing so. The Joint Collateral Agent shall not be liable for any act or
omission or for any error of judgment or any mistake of fact or law in its
individual capacity or its capacity as attorney-in-fact except acts or omissions
resulting from its gross negligence or willful misconduct. This power of
attorney is conferred on the Joint Collateral Agent solely to protect, preserve
and realize upon its security interest in Collateral.
4.11. Termination; Release and Reinstatement of Collateral.
----------------------------------------------------
Subject to Section 6.05 hereof, when a Termination Event shall have occurred,
this Agreement shall terminate, and the Joint Collateral Agent shall forthwith
cause to be assigned, transferred and delivered, against receipt but without any
recourse, warranty or representation whatsoever, any remaining Collateral and
money received in respect thereof, to the Pledgor upon written notice to the
Joint Collateral Agent from the Pledgor, which notice shall certify that a
Termination Event has occurred. Such notice shall set forth the manner in which
the Collateral shall be delivered by the Joint Collateral Agent and the form of
any releases or assignments. Upon certification from the Pledgor that the
Pledgor has complied with the provisions of the Debt Documents permitting such
release, the Joint Collateral Agent shall release all or any part of the
Collateral or otherwise terminate any Lien on all or any part of the Collateral
and shall execute such documents and take such other actions as reasonably
requested by Pledgor in furtherance of the foregoing.
4.12. Performance by the Joint Collateral Agent of Pledgor's
------------------------------------------------------
Obligations. On failure of the Pledgor to perform any of the covenants and
-----------
agreements contained herein, the Joint Collateral Agent may, at its sole option
and in its sole discretion, but shall be under no obligation to, perform the
same and in so doing may expend such sums as the Joint Collateral Agent may
reasonably deem advisable in the performance thereof, including, without
limitation, the payment of any taxes, a payment to obtain a release of a Lien or
potential Lien, expenditures made in defending against any adverse claim and all
other reasonable expenditures which the Joint Collateral Agent may make for the
protection of the Collateral or which it may be
18
compelled to make by operation of law. All such sums and amounts so expended
shall be repayable by the Pledgor promptly upon timely notice thereof and
written demand therefor and shall constitute additional Joint Secured
Obligations and shall bear interest from the date said amounts are so demanded,
at the first interest rate specified in Section 202 of the Indenture. No such
performance of any covenant or agreement by the Joint Collateral Agent on behalf
of the Pledgor, and no such advance or expenditure therefor, shall relieve the
Pledgor of any default under the terms of this Agreement or the other Debt
Documents. The Joint Collateral Agent may make any payment hereby authorized in
accordance with any ▇▇▇▇, statement or estimate procured from the appropriate
public office or holder of the claim to be discharged without inquiry into the
accuracy of such ▇▇▇▇, statement or estimate or into the validity of any tax
assessment, sale, forfeiture, tax lien, title or claim except to the extent such
payment is being contested in good faith by the Pledgor in appropriate
proceedings and against which adequate reserves are being maintained in
accordance with GAAP (or its equivalent for any foreign entity).
4.13. The Joint Collateral Agent's Duty of Care. To the extent
-----------------------------------------
applicable under local law, other than the exercise of reasonable care to assure
the safe custody of the Collateral while being held by the Joint Collateral
Agent hereunder, the Joint Collateral Agent shall have no duty or liability to
preserve rights pertaining thereto, it being understood and agreed that Pledgor
shall be responsible for preservation of all rights in the Collateral of the
Pledgor, and the Joint Collateral Agent shall be relieved of all responsibility
for the Collateral upon surrendering it or tendering the surrender of it to the
Pledgor. The Joint Collateral Agent shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral in its
possession if such Collateral is accorded treatment substantially equal to that
which the Joint Collateral Agent accords its own property, it being understood
that the Joint Collateral Agent shall not have responsibility for (i)
ascertaining or taking action with respect to conversions, exchanges,
maturities, tenders or other material relating to any Collateral, whether or not
the Joint Collateral Agent has or is deemed to have knowledge of such matters;
or (ii) taking any necessary steps to preserve rights against any parties with
respect to any Collateral.
19
Section 5. The Joint Collateral Agent. The Joint Collateral Agent,
--------------------------
the Administrative Agent and the Trustee, by their acceptance of the benefits
hereof, hereby agree among themselves as follows (it being understood and agreed
that the Pledgor shall not have any rights or obligations under this Section 5):
5.01. Appointment, Powers and Immunities. The Joint Collateral
----------------------------------
Agent shall be Wilmington Trust Company or any successor Joint Collateral Agent
appointed as provided in Section 5.08 hereof. The Joint Collateral Agent shall
act as agent for the Administrative Agent and the Trustee hereunder with such
powers as are specifically vested in the Joint Collateral Agent by the terms of
this Agreement, together with such other powers as are reasonably incidental
thereto. Subject to Section 5.10 hereof, the Joint Collateral Agent (which term
as used in this sentence and in the first sentence of Section 5.06 hereof shall
include reference to its affiliates and its own and its affiliates' officers,
directors, employees and agents): (a) shall have no duties or responsibilities
(including, without limitation, under the Trust Indenture Act) except those
expressly set forth in this Agreement, and shall not by reason of this Agreement
be a trustee for any of the Joint Secured Parties and no implied covenants or
obligations shall be inferred from this Agreement against the Joint Collateral
Agent, nor shall the Joint Collateral Agent be bound by the provisions of any
agreement by any party hereto beyond the specific terms hereof; (b) shall not be
responsible to the Joint Secured Parties, the Administrative Agent or the
Trustee for any recitals, statements, representations or warranties contained in
this Agreement, or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement (other than as against the Joint
Collateral Agent) or the Collateral, or for any failure by the Pledgor or any
other Person to perform any of its obligations hereunder or thereunder; (c)
shall not be required to initiate or conduct any litigation or collection
proceedings hereunder (except pursuant to directions furnished under Section
5.06 hereof); (d) shall not be responsible for any action taken or omitted to be
taken by it hereunder, except for its own gross negligence or willful
misconduct; and (e) shall not be required to advise any party as to selling or
retaining, or taking or refraining from taking any action with respect to, any
securities or other property deposited hereunder. The Joint Collateral Agent
shall not be liable for any error of judgment made in good faith by a
Responsible Officer or Officers of the Joint Collateral Agent, unless it shall
be
20
proved that the Joint Collateral Agent was grossly negligent in ascertaining
the pertinent facts upon which such judgment was made.
5.02. Instructions of the Administrative Agent and/or the Trustee.
-----------------------------------------------------------
(a) The Required Secured Parties shall have the right, by one or more
instruments in writing executed and delivered to the Joint Collateral Agent
(after the receipt by the Administrative Agent and/or the Trustee of the consent
of the Required Secured Parties), to direct the time, method and place of
conducting any proceeding for any right or remedy available to the Joint
Collateral Agent, or of exercising any power conferred on the Joint Collateral
Agent, or for the appointment of a receiver, or to direct the taking or
refraining from taking of any action authorized by this Agreement; provided,
--------
however, that (i) such direction shall not conflict with the provisions of any
-------
applicable law or of this Agreement or any Debt Document, (ii) the Required
Secured Parties shall have offered the Joint Collateral Agent indemnity
satisfactory to it against the costs, expenses and liabilities which might be
incurred by it in compliance with such direction and (iii) subject to the
provisions of Section 5.01, the Joint Collateral Agent shall have the right to
decline to follow any such direction if the Joint Collateral Agent in good faith
shall, by a Responsible Officer or Officers of the Joint Collateral Agent,
determine that the proceeding so directed would involve the Joint Collateral
Agent in personal liability with respect to which such indemnity would not
constitute adequate protection. Nothing in this subsection (a) shall impair the
right of the Joint Collateral Agent in its discretion to take any action or omit
to take any action which it deems proper and which is not inconsistent with such
direction. The Joint Collateral Agent shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance with the
direction of the Required Secured Parties pursuant to this Section 5.02.
(b) If, within 30 days after the Joint Collateral Agent receives a
Notice of Acceleration which has not been cancelled, the Joint Collateral Agent
shall not have received written directions from the Administrative Agent or the
Trustee, the Joint Collateral Agent shall, until it receives written directions
from the Administrative Agent or the Trustee, act in such manner as it deems
appropriate; provided, however, that if the Joint Collateral Agent receives no
-------- -------
instructions from the Administrative Agent or the Trustee, the Joint Collateral
Agent shall be fully
21
protected in acting or not acting at its own discretion; provided, further, that
-------- -------
in acting hereunder, the Administrative Agent, the Trustee and the Joint
Collateral Agent will cooperate to ensure compliance by the Pledgor, under the
Indenture, with any applicable mandatory provisions of the Trust Indenture Act,
including, without limitation, Section 314 thereof.
5.03. Reliance by Joint Collateral Agent. The Joint Collateral
----------------------------------
Agent shall be entitled to rely upon any certification, order, judgment,
opinion, notice or other communication (including, without limitation, any
thereof by facsimile) believed by it to be genuine and correct and to have been
signed or sent by or on behalf of the proper Person or Persons (without being
required to determine the correctness of any fact stated therein), and upon
advice and statements of legal counsel, independent accountants and other
experts selected by the Joint Collateral Agent. As to any matters not expressly
provided for by this Agreement, the Joint Collateral Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder in accordance
with instructions given by the Administrative Agent or the Trustee in accordance
with this Agreement.
The Joint Collateral Agent shall be entitled to rely on a certificate
of an officer of the Administrative Agent as to the amount of the Term Loans
outstanding under the Credit Agreement, the principal amount of Term Loans owing
to any Lender, the identity of the Lenders and any Agent (as defined in the
Credit Agreement), the aggregate principal amount of the Term Loans outstanding
with respect to which the Lenders have taken any action hereunder and the
amounts owing to the Lenders, Lender Counterparties and each Agent for purposes
of any payment under Section 4.09 and, in the absence of any such certification,
the Joint Collateral Agent shall have no obligation to take any action on the
basis of any action by the Lenders or to make any payment under Section 4.09 to
the Lenders, Lender Counterparties or any Agent. At the request of the Joint
Collateral Agent, the Administrative Agent and/or Trustee shall provide the
Joint Collateral Agent with such notices, certificates and other information
reasonably necessary for the Joint Collateral Agent to satisfy its obligations
hereunder. The Joint Collateral Agent shall not be deemed to have knowledge or
notice of any Event of Default under the Credit Agreement or of any rescission
of any declaration of acceleration thereunder unless it shall have received
written notice thereof from an officer of the Administrative Agent.
Notwithstanding anything herein to the contrary, the
22
obligations of the Joint Collateral Agent hereunder shall be ministerial and the
Joint Collateral Agent shall not be required to exercise any discretion
hereunder except in accordance with the direction of the Required Secured
Parties given in accordance with Section 5.02.
5.04. Rights in Other Capacities. Except to the extent limited by
--------------------------
the Indenture or the Trust Indenture Act, the Joint Collateral Agent and its
affiliates may (without having to account therefor to the Administrative Agent,
the Trustee or any of the Joint Secured Parties) accept deposits from, lend
money to, make investments in and generally engage in any kind of banking, trust
or other business with the Pledgor (and any of their subsidiaries or affiliates)
as if it were not acting as the Joint Collateral Agent, and the Joint Collateral
Agent and its affiliates may accept fees and other consideration from the
Pledgor for services in connection with this Agreement or otherwise without
having to account for the same to the Administrative Agent, the Trustee or any
of the Joint Secured Parties.
No provision of this Agreement shall require the Joint Collateral
Agent to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder except as a result of its
gross negligence or willful misconduct. In no event shall the Joint Collateral
Agent be liable for any amount in excess of the value of the Collateral.
5.05. Non-Reliance on Joint Collateral Agent. The Joint Collateral
--------------------------------------
Agent shall not in its capacity as such be required pursuant to this Agreement
to keep itself informed as to the performance or observance by the Pledgor of
this Agreement, any Debt Document or any other document referred to or provided
for herein or therein or to inspect the properties or books of the Pledgor or
any of its subsidiaries. Except for notices, reports and other documents and
information expressly required to be furnished by the Joint Collateral Agent
hereunder, the Joint Collateral Agent in its capacity as such shall not have any
duty or responsibility under this Agreement to provide the Administrative Agent,
the Trustee or any of Joint Secured Parties with any credit or other information
concerning the affairs, financial condition or business of the Pledgor or any of
its subsidiaries (or any of their affiliates) that may come into the possession
of the Joint Collateral Agent or any of its affiliates.
23
5.06. Failure to Act. In the event of any ambiguity in the
--------------
provisions of this Agreement or any dispute between or conflicting claims by or
among the Administrative Agent, the Trustee or any of Joint Secured Parties
and/or any other person or entity with respect to any funds or property
deposited hereunder, the Joint Collateral Agent shall be entitled, at its sole
option, to refuse to comply with any and all claims, demands or instructions
with respect to such property or funds so long as such dispute or conflict shall
continue, and the Joint Collateral Agent shall not be or become liable in any
way to the Administrative Agent, the Trustee or any of the Joint Secured Parties
or any other person or entity for its failure or refusal to comply with such
conflicting claims, demands or instructions. The Joint Collateral Agent shall
be entitled to refuse to act until either (i) such conflicting or adverse claims
or demands shall have been finally determined by a court of competent
jurisdiction or settled by agreement between the conflicting party as evidenced
in a writing, satisfactory to the Joint Collateral Agent or (ii) the Joint
Collateral Agent shall have received security or an indemnity satisfactory to
the Joint Collateral Agent sufficient to save the Joint Collateral Agent
harmless from and against any and all loss, liability or expense which the Joint
Collateral Agent may incur by reason of its acting. The Joint Collateral Agent
may in addition elect to commence an interpleader action or seek other judicial
relief or orders as the Joint Collateral Agent may deem necessary or appropriate
under applicable law. Notwithstanding anything contained herein to the contrary,
the Joint Collateral Agent shall not be required to take any action that is in
its opinion contrary to law or to the terms of this Agreement, or which would in
its opinion subject it or any of its officers, employees or directors to
liability.
5.07. Right to Appoint Joint Collateral Agent or Advisor. The
--------------------------------------------------
Joint Collateral Agent shall have the right to appoint agents or advisors in
connection with any of its duties hereunder, including, without limitation,
agent(s) or advisor(s) in connection with the sale of any Collateral held by the
Joint Collateral Agent hereunder, and the Joint Collateral Agent shall not be
liable for any action taken or omitted by such agent(s) or advisor(s) selected
in good faith.
5.08. Resignation and Removal. The Joint Collateral Agent (and any
-----------------------
successor Joint Collateral Agent) may at any time resign as such by giving
written notice of
24
its resignation to the parties hereto at least thirty (30) days prior to the
date specified for such resignation to take effect. The Joint Collateral Agent
may be removed at any time by the consent of each of the Administrative Agent
and the Trustee. Upon the effective date of such resignation or removal of the
Joint Collateral Agent, the Collateral shall be delivered by it to such
successor Joint Collateral Agent or as otherwise shall be instructed in writing
by the Pledgor, the Administrative Agent, and the Trustee, whereupon the Joint
Collateral Agent shall be discharged of and from any and all further obligations
arising in connection with this Agreement. If at that time the Joint Collateral
Agent has not received such instruction, the Joint Collateral Agent's sole
responsibility after that time shall be to safekeep the Collateral until receipt
of a designation of successor Joint Collateral Agent, or a joint written
instruction as to disposition of the Collateral by the Pledgor, the
Administrative Agent and the Trustee or a final order of a court of competent
jurisdiction mandating disposition of the Collateral. If the Joint Collateral
Agent is removed or resigns, the Pledgor, by a Board Resolution, shall promptly
select a successor Joint Collateral Agent subject to the conditions set forth in
Section 5.09 below.
5.09. Qualification. Each successor Joint Collateral Agent shall
-------------
at all times be a corporation organized and doing business under the laws of the
United States of America, any State thereof or the District of Columbia,
authorized under such laws to act as Joint Collateral Agent, having a combined
capital and surplus of not less than $50,000,000 and subject to supervision or
examination by Federal or state authority. If such Joint Collateral Agent
publishes reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for the purposes
of this Section, the combined capital and surplus of such Joint Collateral Agent
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the Joint Collateral
Agent shall cease to be eligible in accordance with the provisions of this
Section, such Joint Collateral Agent shall resign immediately in the manner and
with the effect specified in Section 5.08.
Section 6. Miscellaneous.
-------------
6.01. No Waiver. No failure on the part of the Joint Collateral
---------
Agent or any of its agents to exercise, and
25
no course of dealing with respect to, and no delay in exercising, any right,
power or remedy hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise by the Joint Collateral Agent or any of its agents of
any right, power or remedy hereunder preclude any other or further exercise
thereof or the exercise of any other right, power or remedy. The remedies herein
are cumulative and are not exclusive of any remedies provided by law.
6.02. Governing Law; Submission to Jurisdiction; Venue.
------------------------------------------------
(a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK (WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF). Any
legal action or proceeding with respect to this Agreement or the transactions
contemplated hereby may be brought in the courts of the State of New York, or of
the United States for the Southern District of New York, and, by execution and
delivery of this Agreement, the Pledgor hereby irrevocably submits, for itself
and in respect of its property, generally and unconditionally, to the non-
exclusive jurisdiction of such courts. The Pledgor further irrevocably consents
to the service of process out of any of the aforementioned courts in any such
action or proceeding by the mailing of copies thereof by registered or certified
mail, postage prepaid, to it at the address for notices pursuant to Section 6.04
------------
hereof, such service to become effective thirty (30) days after such mailing.
Nothing herein shall affect the right of the Joint Collateral Agent to serve
process in any other manner permitted by law or to commence legal proceedings or
to otherwise proceed against the Pledgor in any other jurisdiction.
(b) The Pledgor hereby irrevocably waives any objection which it may
now or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement brought in the
courts referred to in subsection (a) hereof and hereby further irrevocably
waives and agrees not to plead or claim in any such court that any such action
or proceeding brought in any such court has been brought in an inconvenient
forum.
6.03. Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY
--------------------
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY
26
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
6.04. Notices. All notices, requests, consents and other
-------
communications provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement) shall be given
or made in writing (including, without limitation, by telecopy) delivered to the
intended recipient at the "Address for Notices" specified below its name on the
signature pages hereof or, as to any party, at such other address as shall be
designated by such party in a notice to the other party. Except as otherwise
provided in this Agreement, all such communications shall be deemed to have been
duly given when transmitted by facsimile or personally delivered or, in the case
of a mailed notice, upon receipt, in each case given or addressed as aforesaid.
6.05. Continuing Agreement. (a) This Agreement shall be a
--------------------
continuing agreement in every respect and shall remain in full force and effect
so long as the any Debt Document is in effect or any amounts payable under the
Indenture, the Credit Agreement, or any other Debt Document or hereunder or any
of the Securities or Term Loans shall remain outstanding. Upon termination of
this Agreement, the Joint Collateral Agent shall, upon the request and at the
expense of the Pledgor, forthwith release, without recourse, representation or
warranty, all of its liens and security interests hereunder, execute such
documents and take such other actions as reasonably requested by Pledgor in
furtherance of the termination, and return any Collateral in its possession to
the Pledgor, the form of any such release to be provided by the Pledgor.
Notwithstanding the foregoing, all releases and indemnities provided hereunder
shall survive termination of this Agreement.
(b) This Agreement shall continue to be effective or be automatically
reinstated, as the case may be, if at any time payment, in whole or in part, of
any of the Joint Secured Obligations is rescinded or must otherwise be restored
or returned by the Joint Collateral Agent or the Administrative Agent or the
Trustee as a preference, fraudulent conveyance or otherwise under any
bankruptcy, insolvency or similar law, all as though such payment had not been
made; provided that in the event payment of all or any part of the Joint Secured
--------
Obligations is rescinded or must be restored or returned, all reasonable costs
and expenses (including without limitation any reasonable legal fees and
disbursements) incurred by the Joint Collateral
27
Agent in defending and enforcing such reinstatement shall be deemed to be
included as a part of the Joint Secured Obligations.
6.06. Waivers, Amendments, Etc. (a) Except as expressly provided
------------------------
hereby and in the Indenture or Credit Agreement, the terms of this Agreement may
be waived, altered, amended, modified, changed, discharged or terminated only by
an instrument in writing duly executed by each of the parties hereto and
approved by the Required Secured Parties; provided, however, that a waiver,
alteration, amendment, modification, change, discharge or termination that
affects only the parties (i) to the Credit Agreement (other than the Pledgor)
and does not adversely affect the Trustee or the Holders shall be effective if
made by an instrument in writing duly executed by each of the parties hereto
other than the Trustee and (ii) to the Indenture (other than the Pledgor) and
does not adversely affect the Lenders or the Administrative Agent shall be
effective if made only by the parties hereto other than the Administrative Agent
and approved by the Holders of a majority in principal amount of the Securities.
(b) Anything herein to the contrary notwithstanding if the Pledgor
incurs any indebtedness which qualifies as Refinancing Indebtedness, each of the
parties hereto will, upon the request of the Pledgor, enter into any amendments
or modifications to this Agreement for the purpose of (i) modifying the
definition of Debt Documents to include all material agreements entered into in
connection with the Refinancing Indebtedness, (ii) modifying the definition of
Joint Secured Parties to include the relevant parties to such Refinancing
Indebtedness, (iii) providing for the addition of any party or the substitution
of the Administrative Agent or the Trustee, as appropriate, (iv) revising the
definition of "Parity Pro Rata Basis" and similar terms such that the holders of
such Refinancing Indebtedness have the same pro rata rights as are applicable to
the Joint Secured Parties and (v) making such other modifications as are
reasonably necessary or desirable to include such Refinancing Indebtedness
hereunder; provided, however, that no such amendment or modification shall amend
the rights or duties of the Joint Collateral Agent, the Trustee or the
Administrative Agent hereunder, in each case, without the express written
consent of such party.
6.07. Successors and Assigns. This Agreement shall create a
----------------------
continuing security interest in the Collateral and shall be binding upon the
Pledgor, its
28
successors and assigns and shall inure, together with the rights
and remedies of the Joint Collateral Agent hereunder, to the benefit of the
Joint Collateral Agent and its successors and assigns for the benefit of the
Administrative Agent or the Trustee; provided, however, that the Pledgor may not
-------- -------
assign its rights or delegate its duties hereunder without first filing with the
Joint Collateral Agent a certificate of the Pledgor that such assignment or
transfer is permitted by the Debt Documents and obtaining the prior written
consent of the Administrative Agent or the Trustee, as applicable. To the
fullest extent permitted by law, the Pledgor hereby releases the Joint
Collateral Agent, and its successors and assigns, from any liability for any act
or omission relating to this Agreement or the Collateral, except for any
liability arising from the gross negligence or willful misconduct of the Joint
Collateral Agent, or its officers, employees or agents. Neither the
Administrative Agent nor the Trustee may assign any of their respective
interests, rights and obligations set forth in this Agreement, unless such
assignment was in connection with an assignment permitted under the applicable
Debt Document; provided, in the case of any such permitted assignment, that such
assignee agrees to be bound by the terms hereof.
6.08. Counterparts. This Agreement may be executed in any number
------------
of counterparts, all of which taken together shall constitute one and the same
instrument and any of party hereto may execute this Agreement by signing any
such counterpart. It shall not be necessary in making proof of this Agreement
to produce or account for more than one such counterpart.
6.09. Severability. If any provision hereof is illegal, invalid or
------------
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in favor of the Joint Collateral
Agent, the Administrative Agent and the Trustee in order to carry out the
intentions of the parties hereto as nearly as may be possible and (ii) the
illegality, invalidity or unenforceability of any provision hereof in any
jurisdiction shall not affect the illegality, validity or enforceability of such
provision in any other jurisdiction.
6.10. Entirety. This Agreement and the Debt Documents represent
--------
the entire agreement of the parties hereto and thereto with respect to the
Collateral described herein, and supersede all prior agreements and
29
understandings, oral or written, if any, including any correspondence relating
thereto or the transactions contemplated herein and therein.
6.11. Survival. All representations and warranties of the Pledgor
--------
hereunder shall survive the execution and delivery of this Agreement and the
other Debt Documents.
6.12. Expenses, Indemnity, Etc. The Pledgor agrees to pay the
-------------------------
Joint Collateral Agent such compensation as has previously been agreed upon by
the Pledgor and the Joint Collateral Agent for any and all services rendered by
the Joint Collateral Agent; provided, however, that the Joint Collateral Agent
-------- -------
and the Pledgor may from time to time agree in writing to such other
compensation of the Joint Collateral Agent hereunder. In addition, the Pledgor
agrees to reimburse the Joint Collateral Agent for: (a) all reasonable out-of-
pocket costs and expenses of the Joint Collateral Agent (including, without
limitation, the reasonable fees and expenses of counsel to the Joint Collateral
Agent), in connection with (i) the negotiation, preparation, execution and
delivery of, and ongoing administration of, this Agreement and (ii) any
modification, supplement or waiver of any of the terms of this Agreement; (b)
all reasonable costs and expenses of the Joint Collateral Agent (including,
without limitation, reasonable counsels' fees) in connection with (i) any Notice
of Acceleration and any enforcement or collection proceedings resulting
therefrom or incurred in connection with causing the Pledgor to satisfy its
obligations hereunder and (ii) the enforcement of this Section 6.12; and (c) all
transfer, stamp, documentary or other similar taxes, assessments or charges
levied by any governmental or revenue authority in respect of this Agreement or
any other document referred to herein and all costs, expenses, taxes,
assessments and other charges incurred in connection with any filing,
registration, recording or perfection of any security interest contemplated
hereby. The Pledgor agrees to indemnify the Joint Collateral Agent from, and
hold the Joint Collateral Agent harmless against, any and all losses,
liabilities, claims, damages or expenses incurred by the Joint Collateral Agent
arising out of or in connection with the Joint Collateral Agent's duties under
this Agreement or by reason of any investigation or litigation or other
proceedings (including any threatened investigation or litigation or other
proceedings) involving this Agreement (but excluding any such losses,
liabilities, claims, damages
30
or expenses incurred by reason of the gross negligence or willful misconduct of
the Joint Collateral Agent).
In addition to the foregoing, the Pledgor agrees to pay to the Joint
Collateral Agent all reasonable out-of-pocket expenses (including reasonable
expenses for legal services of every kind) of, or incident to, the enforcement
of any of the provisions of Section 4, or performance by the Joint Collateral
Agent of any obligations of the Pledgor under this Agreement in respect of the
Collateral which the Pledgor has failed or refused to perform, or any actual or
attempted sale, or any exchange, enforcement, collection, compromise or
settlement in respect of any of the Collateral, and for the care of the
Collateral and defending or asserting rights and claims of the Joint Secured
Parties in respect thereof, by litigation or otherwise. The provisions of this
Section 6.12 shall survive the termination of this Agreement or the resignation
or removal of the Joint Collateral Agent.
All amounts due under this Section 6.12 shall constitute Joint Secured
Obligations hereunder.
6.13. Trust Indenture Act. If any provision of this Agreement
-------------------
limits, qualifies or conflicts with the duties imposed on the Joint Collateral
Agent by the Trust Indenture Act, the Trust Indenture Act shall control to the
extent applicable. Any action required to be taken in order to comply with the
Trust Indenture Act shall be taken by the Pledgor or the Joint Collateral Agent.
6.14. Security Interest Absolute. To the extent permitted by
--------------------------
applicable law, all rights of the Joint Collateral Agent and security interests
hereunder, and all obligations of the Pledgor hereunder, shall be absolute and
unconditional irrespective of:
(a) any lack of validity or enforceability of any provision of any
Debt Document or any other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or any
other term of, or any increase in the amount of, all or any of the Joint Secured
Obligations, or any other amendment or waiver of any term of, or any consent to
any departure from any requirement of, any Debt Document or any other agreement
or instrument relating thereto;
31
(c) any exchange, release or non-perfection of any Lien on any other
collateral; or
(d) any other circumstance which might otherwise constitute a defense
available to, or discharge of, a borrower, or a pledgor.
6.15. Headings. The headings of the sections and subsections
--------
hereof are provided for convenience only and shall not in any way affect the
meaning or construction of any provision of this Agreement.
6.16. Shared Collateral. Each of the Joint Secured Parties agrees
-----------------
that all Collateral pledged under this Agreement is for the joint benefit of all
the Joint Secured Parties.
32
The Pledgor has caused a counterpart of this Agreement to be duly executed
and delivered as of the date first above written.
MISSION ENERGY HOLDING COMPANY
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Title: Chief Executive Officer
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
WILMINGTON TRUST COMPANY
As Trustee
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Authorized Signer
Address for Notices:
▇▇▇▇▇▇ Square North
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
WILMINGTON TRUST COMPANY
As Joint Collateral Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Authorized Signer
Address for Notices:
▇-▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ CREDIT PARTNERS L.P.
As Administrative Agent
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
By: ____________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Authorized Signer
Address for Notices:
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
(Pledge and Security Agreement)
S-2
ANNEX A
-------
to
Pledge and Security Agreement
dated as of July 2, 2001
in favor of Wilmington Trust Company
as Joint Collateral Agent
PLEDGED SHARES
--------------
Name of Pledgor: Mission Energy Holding Company ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Class and Number of Certificate Percentage
Name of Issuer Par Value Shares Number Ownership
-------------- --------- ------ ------ ---------
Edison Mission 100 3 100%
Energy
35
