Exhibit 4
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (this "Agreement") dated May 24, 2004, is
entered into by and between The Madison Avenue Capital Group II Trust, a
trust formed under the laws of Colorado, Madison Liquidity Investors 104,
LLC, Madison Liquidity Investors 100, LLC, Madison Liquidity 112, LLC,
Madison Liquidity Investors 120, LLC, Windy City Investment, LLC, Madison
Liquidity Investors 103, LLC, Madison Liquidity Investors 111, LLC, Madison
Liquidity Investors 119, LLC (all Delaware limited liability companies,
unless otherwise indicated), (each a "Pledgor", collectively the
"Pledgors") and KALMIA INVESTORS, LLC, a Delaware limited liability
company, as pledgee (the "Pledgee").
W I T N E S S E T H T H A T :
WHEREAS:
The Pledgors, Madison Capital Management, LLC, a Nevada limited
liability company ("Holdco") have entered into a Purchase Agreement dated
May 24, 2004 (the "Purchase Agreement"), whereby, inter alia, each Pledgor
has transferred to the Pledgee all of such Pledgor's respective rights,
title and interest in, and claims to 10,512 Units, in the aggregate, of
limited partnership interest of Westin Hotels Limited Partnership (the
"Partnership"), all security entitlements thereof, together with all
additions thereto, replacements thereof and substitutions therefor, all
payments of dividends, cash, instruments, and other property from time to
time received, receivable or otherwise distributed after March 31, 2004, in
respect of, or in exchange for, or upon the conversion thereof, all rights
and privileges of the Pledgors with respect thereto, and all proceeds
thereof, whether now existing or hereafter arising, and the proceeds
thereof (the "Collateral"). (Collateral not including any proceeds due to
the Pledgors from the sale of the Units pursuant to the Purchase
Agreement).
(A) As a condition to the Pledgee's purchase of the Units and
payment therefor, the Pledgee requires that each Pledgor individually and
not jointly executes and delivers to the Pledgee this Agreement and grants
the security interests contemplated hereby in order to create in favor of
the Pledgee a valid and perfected pledge and security interest, as that
term is defined in the Uniform Commercial Code of Delaware (the "Code"), in
the Collateral, as security for the payment and performance of all of the
obligations of such Pledgor jointly and severally with Holdco, not jointly
or severally with any of the other Pledgors under or in connection with the
Purchase Agreement, including the obligation to cause the general partner
of the Partnership to transfer the Units to the name of the Pledgee and
registration of the Units in the name of the Pledgee on the books of the
Partnership (such obligations of each individual Pledgor and Holdco are
hereinafter referred to as the "Secured Obligations").
NOW, THEREFORE, in consideration of the premises, the parties
hereby agree as follows:
1. Grant of Security. As security for the Secured Obligations,
each Pledgor individually, as legal and beneficial owners, hereby assigns,
pledges, transfers and set over to the Pledgee and its successors and
assigns, and hereby grants to the Pledgee a security interest in, all of
such Pledgor's right, title and interest in and to the Collateral.
2. Security for Secured Obligations. This Agreement secures the
payment and performance of all of the Secured Obligations of each Pledgor
individually and is not intended to cause any one Pledgor to secure the
payment or performance obligations of any other Pledgor.
3. Negative Pledge. Each Pledgor does hereby, individually and
not jointly, warrant and represent that it has not assigned or pledged, and
hereby covenants it will not assign or pledge so long as this Assignment
shall remain in effect, any of its respective right, title or interest in
the whole or any part of the Collateral hereby assigned to anyone other
than the Pledgee, and it will take or omit to take any action, the taking
or omission of which might result in an alteration or impairment of the
rights hereby assigned or any of the rights created in this Agreement; and
such Pledgor does hereby irrevocably appoint and constitute the Pledgee as
such Pledgor's true and lawful attorney-in-fact with full power (in the
name of such Pledgor or otherwise) to ask, require, demand, receive,
compound and give acquittance for any and all moneys and claims for moneys
assigned hereby, to endorse any checks or other instruments or orders in
connection therewith, to file any claims or take any action or institute
any proceedings which the Pledgee may deem to be necessary or advisable in
the premises and to file any and all Code financing statements or renewals
thereof in connection with this Agreement without the signature of such
Pledgor which the Pledgee may deem to be necessary or advisable in order to
perfect or maintain the security interest granted hereby.
4. Other Financing Statements and Liens. No Pledgor shall,
without the prior written consent of the Pledgee, 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 file or authorize any like
instrument, with respect to the Collateral in which the Pledgee is not
named as the sole secured party.
5. Preservation of Rights. The Pledgee shall not be required to
take steps necessary to preserve any rights against prior parties to any of
the Collateral.
6. Application of Proceeds. All moneys collected or received from
time to time by the Pledgee pursuant to this Agreement shall be dealt with
by the Pledgee in its sole discretion.
7. Remedies. The security constituted by this Agreement shall be
enforceable against a Pledgor if a default in the Secured Obligations shall
have occurred and be continuing with respect to such Pledgor. (Such Pledgor
is hereinafter referred to as a "Defaulted Pledgor.") It is the express
understanding of the parties hereto that a default in the Secured
Obligations of one Defaulted Pledgor PER SE shall not permit the Pledgee to
enforce any rights with respect to any other Pledgor or the Collateral of
any other Pledgor.
In such case, the Pledgee may exercise, in respect of the
Collateral of a Defaulted Pledgor, in addition to other rights and remedies
provided for herein or otherwise available to it, all the rights and
remedies of a Pledgee on default under the Code (whether or not the Code
shall be applied by the court in the jurisdiction in which enforcement of
the security interest contained herein is sought) and also may (i) require
the Defaulted Pledgors to, and the Pledgors hereby agree that, at such time
they become a Defaulted Pledgor, they will at their own expense and upon
request of the Pledgee forthwith, assemble all or any part of the
Collateral as directed by the Pledgee and make it available to the Pledgee,
at a place to be designated by the Pledgee which is reasonably convenient
to the parties, and (ii) without notice, except as specified below, sell
the Defaulted Pledgor's Collateral or any part thereof in one or more
parcels at public or private sale, at any of the Pledgee's offices or
elsewhere, for cash, and at such price or prices and upon such other terms
as the Pledgee may deem commercially reasonable. The Pledgee shall give the
Defaulted Pledgor at least ten days' notice of the time and place of any
public sale. The Pledgors agree that should they become a Defaulted
Pledgor, ten days' notice of any such sale is commercially reasonable
notification. The Pledgee shall not be obligated to make any sale of the
Collateral regardless of notice of sale having been given. The Pledgee may
adjourn any public or private sale from time to time by announcement at the
time and place fixed therefor, and such sale may, without further notice,
be made at the time and place to which it was so adjourned.
8. Non-Interference with Remedies; Specific Performance. (a) Each
Pledgor individually agrees that following the occurrence and during the
continuance of a default by such Pledgor in its respective Secured
Obligations, it will not at any time, pledge, claim or take the benefit of
any appraisal, valuation, stay, extension, moratorium or redemption law now
or hereafter in force in order to prevent or delay the enforcement of this
Agreement, or the absolute sale of the whole or any part of such Pledgor's
Collateral or the possession thereof by any purchaser at any sale
hereunder, and each Pledgor individually waives the benefit of all such
laws to the extent they lawfully may do so. The Pledgors agree they will
not interfere with any right, power or remedy of the Pledgee provided for
in this Agreement now or hereafter existing at law or in equity or by
statute or otherwise, or with the exercise or beginning of the exercise by
the Pledgee of any one or more of such rights, powers or remedies.
(b) The Pledgors agree that a breach of any of the agreements or
covenants contained in this Agreement will cause irreparable injury to the
Pledgee, that the Pledgee has no adequate remedy at law in respect of such
breach and, as a consequence, agrees that each and every agreement and
covenant of a Pledgor contained in this Agreement shall be specifically
enforceable against such Pledgor and only such Pledgor, individually and
not jointly, and the Pledgors hereby waive and agree not to assert any
defenses against an action for specific performance of such agreements or
covenant.
9. Further Assurances. The Pledgors agree that at any time and
from time to time, upon the written request of the Pledgee, the Pledgors
will promptly and duly execute and deliver any and all such further
instruments and documents as the Pledgee may deem desirable in obtaining
the full benefits of this Agreement and of the rights and powers herein
granted.
10. Remedies Cumulative and Not Exclusive; No Waiver. Each and
every right, power and remedy herein given to the Pledgee shall be
cumulative and shall be in addition to every other right, power and remedy
of the Pledgee now or hereafter existing at law, in equity or by statute,
and each and every right, power and remedy, whether herein given or
otherwise existing, may be exercised from time to time, in whole or in
part, and as often and in such order as may be deemed expedient by the
Pledgee, and the exercise or the beginning of the exercise of any right,
power or remedy shall not be construed to be a waiver of the right to
exercise at the same time or thereafter any other right, power or remedy.
No delay or omission by the Pledgee in the exercise of any right or power
or in the pursuance of any remedy accruing upon any breach or default by
any person shall impair any such right, power or remedy or be construed to
be a waiver of any such right, power or remedy or to be an acquiescence
therein; nor shall the acceptance by the Pledgee of any security or of any
payment of or on account of any of the amounts due from any person under or
in connection with the Purchase Agreement or any document delivered in
connection therewith and maturing after any breach or default or of any
payment on account of any past breach or default be construed to be a
waiver of any right to take advantage of any future breach or default or of
any past breach or default not completely cured thereby.
11. Invalidity. If any provision of this Agreement shall at any
time for any reason be declared invalid, void or otherwise inoperative by a
court of competent jurisdiction, such declaration or decision shall not
affect the validity of any other provision or provisions of this Agreement,
or the validity of this Agreement as a whole. In the event that it should
transpire that by reason of any law or regulation, or by reason of a ruling
of any court, or by any other reason whatsoever, the Agreement herein
contained is either wholly or partly defective, the Pledgors hereby
undertake to furnish the Pledgee with an alternative Agreement or
alternative security and/or to do all such other acts as, in the sole and
reasonable opinion of the Pledgee, shall be required in order to ensure and
give effect to the full intent of this Agreement.
12. Continuing Security. It is declared and agreed that the
security created by this Agreement in the Collateral of a Pledgor shall be
held by the Pledgee as a continuing security for performance of all the
Secured Obligations of such Pledgor and no other Pledgor and that the
security so created shall not be satisfied by an intermediate satisfaction
of any part of such Pledgor's obligations and that the security so created
shall be in addition to and shall not in any way be prejudiced or affected
by any collateral or other security of a Pledgor now or hereafter held by
the Pledgee for all or any part of the moneys hereby secured.
13. Security Interest Absolute. All rights of the Pledgee and the
security interest granted hereunder, and all Secured Obligations, shall be
absolute and unconditional, irrespective of:
(i) any lack of validity or enforceability of the Purchase
Agreement, or any other agreement or instrument
relating thereto;
(ii) any change in the time, manner of, or in any other term
of, all or any of the obligations of any Pledgor and
Holdco or any other person under or in connection with
the Purchase Agreement or any other amendment or waiver
of or any consent to any departure from the Purchase
Agreement or the terms thereof; or
(iii) any other circumstances which might otherwise
constitute a defense available to, or a discharge of,
the Pledgors in respect of the Secured Obligations or
this Agreement.
14. Waiver; Amendment. None of the terms and conditions of this
Assignment may be changed, waived, modified or varied in any manner
whatsoever unless in writing duly signed by the Pledgee and the Pledgors.
15. Notices. Notices and other communications hereunder shall be
in writing and may be sent by fax as follows:
If to the Pledgors:
Madison Capital Management, LLC
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxx
Tel.: 000 000 0000
Fax: 000 000 0000
Copy to:
Xxxxxxxx Xxxx
00 Xxxxxxxxxx Xxxxxx
Xxxxx Xxxxxxxxxx, Xxxxxxxxxxxxx 00000
Tel.: 000 000 0000
Fax: 000 000 0000
If to the Pledgee:
Kalmia Investors, LLC
000 Xxxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Tel.: 000 000 0000
Fax: 000 000 0000
or to such other address as a party shall from time to time specify in
writing to the other parties. Any notice sent by facsimile shall be
confirmed by letter dispatched as soon as practicable thereafter.
Every notice or other communication shall, except so far as otherwise
expressly provided by this Assignment, be deemed to have been received
(provided that it is received prior to 2 p.m. New York time; otherwise it
shall be deemed to have been received on the next following Business Day)
in the case of a facsimile on the date of dispatch thereof (provided
further that if the date of dispatch is not a Business Day in the locality
of the party to whom such notice or demand is sent, it shall be deemed to
have been received on the next following Business Day in such locality),
and in the case of a letter, at the time of receipt thereof.
16. Successors and Assigns. Whenever in this Agreement reference
is made to any person, such reference shall be deemed to include the
successors and assigns of such person.
17. Waiver of Jury Trial. IT IS MUTUALLY AGREED BY AND BETWEEN
THE PARTIES HERETO THAT EACH OF THEM HEREBY WAIVES TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER PARTY HERETO AGAINST
THE OTHER PARTY HERETO ON ANY MATTER WHATSOEVER ARISING OUT OF OR IN ANY
WAY CONNECTED WITH THIS AGREEMENT AND ANY SECURITY DOCUMENT TO WHICH THE
PLEDGORS OR THE PLEDGEE MAY BE A PARTY OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.
18. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT ANY
REFERENCE TO CONFLICTS OF LAWS PRINCIPLES OF THAT STATE.
19. Headings. In this Assignment, Section headings are inserted
for convenience of reference only and shall be ignored in the
interpretation hereof.
20. Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be deemed to be duplicate originals and
which shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed on the day and year first above written.
THE MADISON AVENUE CAPITAL GROUP II
TRUST
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Xxxxx X. Xxxxxx
Managing Director
MADISON LIQUIDITY INVESTORS 104, LLC
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Xxxxx X. Xxxxxx
Managing Director
MADISON LIQUIDITY INVESTORS 100, LLC
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Xxxxx X. Xxxxxx
Managing Director
MADISON LIQUIDITY INVESTORS 112, LLC
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Xxxxx X. Xxxxxx
Managing Director
MADISON LIQUIDITY INVESTORS 120, LLC
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Xxxxx X. Xxxxxx
Managing Director
WINDY CITY INVESTMENT, LLC
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Xxxxx X. Xxxxxx
Managing Director
MADISON LIQUIDITY INVESTORS 103, LLC
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Xxxxx X. Xxxxxx
Managing Director
MADISON LIQUIDITY INVESTORS 111, LLC
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Xxxxx X. Xxxxxx
Managing Director
MADISON LIQUIDITY INVESTORS 119, LLC
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Xxxxx X. Xxxxxx
Managing Director
MADISON CAPITAL MANAGEMENT, LLC
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Xxxxx X. Xxxxxx
Managing Director
KALMIA INVESTORS, LLC
By: Smithtown Bay, LLC
Manager
By: Global Capital Management, Inc.
Manager
By: /s/ Xxxxxx Xxxxxxx
------------------------------
Xxxxxx Xxxxxxx
Vice President
21919.0001 #478126v4
