EXHIBIT-10.27
SECOND AMENDED AND RESTATED PLEDGE AGREEMENT
THIS SECOND AMENDED AND RESTATED PLEDGE AGREEMENT (the "Pledge
Agreement"), dated as of December 19, 1997 is made by ACC CORP., a Delaware
corporation (the "Pledgor"), in favor of FIRST UNION NATIONAL BANK, a national
banking association (the "Administrative Agent"), as Administrative Agent for
the ratable benefit of itself and the financial institutions (the "Lenders") as
are, or may from time to time become, parties to the Credit Agreement (as
defined below).
STATEMENT OF PURPOSE
The Pledgor has previously executed and delivered to the Administrative
Agent a Pledge Agreement dated as of July 21, 1995, as amended by the Amended
and Restated Pledge Agreement dated as of January 14, 1997 (the "First Amended
and Restated Pledge Agreement").
Pursuant to the Second Amended and Restated Credit Agreement, dated as
of even date herewith (as amended, restated or otherwise modified, the "Credit
Agreement"), between the Pledgor and certain Subsidiaries of the Pledgor as
Borrowers thereunder (collectively, the "Borrowers"), the Lenders and the
Administrative Agent, the Lenders will provide Extensions of Credit to the
Borrowers as more specifically described in the Credit Agreement.
The Pledgor is the legal and beneficial owner of the shares of Pledged
Stock (as hereinafter defined) issued by the Domestic Subsidiaries and the
Foreign Subsidiaries, as specified on Schedule 1 attached hereto and
incorporated herein by reference (collectively, the "Issuers").
In connection with the transactions contemplated by the Credit
Agreement and as a condition precedent thereto, the Lenders have requested that
the Pledgor amend and restate the First Amended and Restated Pledge Agreement,
and the Pledgor has agreed to do so pursuant to the terms of this Pledge
Agreement.
NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent and the Lenders to enter into and make available Loans
pursuant to the Credit Agreement, the Pledgor hereby agrees with the
Administrative Agent for the ratable benefit of itself and Lenders as follows:
1. Defined Terms. Unless otherwise defined herein, terms which are
defined in the Credit Agreement and used herein are so used as so defined, and
the following terms shall have the following meanings:
"Code" means the Uniform Commercial Code from time to time in
effect in the State of North Carolina.
"Collateral" means the Pledged Stock and all Proceeds.
"Foreign Subsidiaries" means the collective reference
to all Subsidiaries that are not Domestic Subsidiaries.
"Pledge Agreement" means this Second Amended and Restated
Pledge Agreement, as further amended, restated or otherwise modified.
"Pledged Stock" means the shares of capital stock of each
Issuer listed on Schedule 1 hereto, together with all stock
certificates, options or rights of any nature whatsoever that may be
issued or granted by such Issuer to the Pledgor while this Pledge
Agreement is in effect.
"Proceeds" means all "proceeds" as such term is defined in
Section 9-306(1) of the Code on the date hereof and, in any event,
shall include, without limitation, all dividends or other income from
the Pledged Stock, collections thereon, proceeds of sale thereof or
distributions with respect thereto.
"Secured Obligations" means the Obligations of the Pledgor as
defined in the Credit Agreement and any renewals or extensions of any
of such Obligations.
2. Pledge and Grant of Security Interests. The Pledgor hereby delivers
to the Administrative Agent, for the ratable benefit of itself and the Lenders,
all of the Pledged Stock and hereby grants to the Administrative Agent, for the
ratable benefit of itself and the Lenders, a first priority security interest in
such Pledged Stock and all other Collateral, as collateral security for the
prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration or otherwise) of the Secured Obligations.
3. Stock Powers. Concurrently with the delivery to the Administrative
Agent of each certificate representing one or more shares of Pledged Stock, the
Pledgor shall deliver an undated stock power covering such certificate, duly
executed in blank by the Pledgor with, if the Administrative Agent so requests,
signature guaranteed.
4. Representations and Warranties. To induce the Administrative Agent
and the Lenders to execute the Credit Agreement, provide any Extensions of
Credit and accept the security contemplated hereby, the Pledgor hereby
represents and warrants that:
(a) the Pledgor has the corporate power, authority and legal
right to execute and deliver, to perform its obligations under, and to
grant the Lien on the Collateral pursuant to, this Pledge Agreement and
has taken all necessary corporate action to authorize its execution,
delivery and performance of, and grant of the Lien on the Collateral
pursuant to, this Pledge Agreement;
(b) this Pledge Agreement constitutes a legal, valid and
binding obligation of the Pledgor enforceable against the Pledgor in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by the
availability of equitable remedies;
(c) the execution, delivery and performance of this Pledge
Agreement will not violate any provision of any Applicable Law or
contractual obligation of the Pledgor and will not result in the
creation or imposition of any Lien on any of the properties or revenues
of the Pledgor pursuant to any Applicable Law or contractual
obligation, except as contemplated hereby;
(d) except as contemplated in Section 11 hereof, no consent or
authorization of, filing with, or other act by or in respect of, any
arbitrator or Governmental Authority and no consent of any other Person
(including, without limitation, any stockholder or creditor of the
Pledgor or any Issuer), is required in connection with the execution,
delivery, performance, validity or enforceability against the Pledgor
of this Pledge Agreement;
(e) no litigation, investigation or proceeding of or before
any arbitrator or Governmental Authority is pending or, to the
knowledge of the Pledgor, threatened by or against the Pledgor or
against any of its properties or revenues with respect to this Pledge
Agreement or any of the transactions contemplated hereby;
(f) the shares of Pledged Stock listed on Schedule 1
constitute all the issued and outstanding shares of all classes of the
capital stock of each of the Domestic Subsidiaries and constitute
66.66% of all the issued and outstanding shares of all classes of
capital stock of all Foreign Subsidiaries owned by the Pledgor;
(g) all the shares of the Pledged Stock have been duly and
validly issued and are fully paid and nonassessable;
(h) the Pledgor is the record and beneficial owner of, and has
good and marketable title to, the Pledged Stock listed on Schedule 1,
free of any and all Liens or options in favor of, or claims of, any
other Person, except the Lien created by this Pledge Agreement; and
(i) upon delivery to the Administrative Agent of the stock
certificates evidencing the Pledged Stock, the Lien granted pursuant to
this Pledge Agreement will constitute a valid, perfected first priority
Lien on the Pledged Stock and the Proceeds related thereto, enforceable
as such against all creditors of the Pledgor and any Persons purporting
to purchase any of the Pledged Stock from the Pledgor.
5. Certain Covenants. The Pledgor covenants and agrees with the
Administrative Agent for the ratable benefit of itself and the Lenders that,
from and after the date of this Pledge Agreement until the Secured Obligations
are paid in full and the Commitments are terminated:
(a) If the Pledgor shall, as a result of its ownership of the
Pledged Stock, become entitled to receive or shall receive any stock
certificate (including, without limitation, any certificate
representing a stock dividend or a distribution in connection with any
reclassification, increase or reduction of capital or any certificate
issued in connection with any reorganization), option or rights,
whether in addition to, in substitution of, as a conversion of, or in
exchange for any shares of the Pledged Stock, or otherwise in respect
thereof, the Pledgor shall accept the same as the agent of the
Administrative Agent, hold the same in trust for the Administrative
Agent and deliver the same forthwith to the Administrative Agent in the
exact form received, duly indorsed by the Pledgor to the Administrative
Agent, if required, together with an undated stock power covering such
certificate duly executed in blank by the Pledgor and with, if the
Administrative Agent so requests, signature guaranteed, to be held by
the Administrative Agent, subject to the terms hereof, as additional
collateral security for the Secured Obligations; PROVIDED, that in no
event shall more than 66.66% of all the issued and outstanding shares
of all classes of capital stock of each of the Foreign Subsidiaries
constitute collateral security hereunder. In addition, any sums paid
upon or in respect of the Pledged Stock upon the liquidation or
dissolution of any Issuer shall be held by the Administrative Agent as
additional collateral security for the Secured Obligations.
(b) Without the prior written consent of the Administrative
Agent, the Pledgor will not (i) vote to enable, or take any other
action to permit, any Issuer to issue any stock or other equity
securities of any nature or to issue any other securities convertible
into or granting the right to purchase or exchange for any stock or
other equity securities of any nature of such Issuer, (ii) sell,
assign, transfer, exchange, or otherwise dispose of, or grant any
option with respect to, the Pledged Stock, or (iii) create, incur or
permit to exist any Lien or option in favor of, or any claim of any
Person with respect to, any of the Collateral, or any interest therein,
except for the Lien provided for by this Pledge Agreement. The Pledgor
will defend the right, title and interest of the Administrative Agent
in and to the Collateral against the claims and demands of all Persons
whomsoever.
(c) At any time and from time to time, upon the written
request of the Administrative Agent, and at the sole expense of the
Pledgor, the Pledgor will promptly and duly execute and deliver such
further instruments and documents and take such further actions as the
Administrative Agent may reasonably request for the purposes of
obtaining or preserving the full benefits of this Pledge Agreement and
of the rights and powers herein granted. If any amount payable under or
in connection with any of the Collateral shall be or become evidenced
by any promissory note, other instrument or chattel paper, such note,
instrument or chattel paper shall be immediately delivered to the
Administrative Agent, duly endorsed in a manner satisfactory to the
Administrative Agent, to be held as Collateral pursuant to this Pledge
Agreement.
(d) The Pledgor agrees to pay, and to save the Administrative
Agent and the Lenders harmless from, any and all liabilities with
respect to, or resulting from any delay in paying, any and all stamp,
excise, sales or other similar taxes which may be payable or determined
to be payable with respect to any of the Collateral or in connection
with any of the transactions contemplated by this Pledge Agreement.
(e) On or prior to the formation or acquisition of any
Subsidiary of the Pledgor, the Pledgor agrees to execute such
amendments and supplements to this Pledge Agreement, including without
limitation the Pledge Agreement Supplement attached hereto, and such
other documents and instruments and to take any and all actions, all as
shall be necessary, in the reasonable judgment of the Administrative
Agent, to pledge the Pledgor's interest therein to the Administrative
Agent for the ratable benefit of itself and the Lenders.
(f) Without the prior written consent of the Administrative
Agent, the Pledgor will not sell, assign, transfer, exchange, or
otherwise dispose of, or grant any option with respect to, or create,
incur or permit to exist any Lien or option in favor of, or any claim
of any Person with respect to, any of the shares of capital stock of
any Foreign Subsidiary owned by the Pledgor but not pledged hereunder,
or any interest therein, except as otherwise permitted pursuant to
Section 10.3 or Section 10.4 of the Credit Agreement.
6. Cash Dividends; Voting Rights. Unless an Event of Default shall have
occurred and be continuing and the Administrative Agent shall have given notice
to the Pledgor of the Administrative Agent's intent to exercise its rights
pursuant to Section 7 below, the Pledgor shall be permitted to receive all cash
dividends paid in accordance with the terms of the Credit Agreement in respect
of the Pledged Stock and to exercise all voting and corporate rights with
respect to the Pledged Stock; PROVIDED, that no vote shall be cast or corporate
right exercised or other action taken which would impair the Collateral or which
would be inconsistent with or result in any violation of any provision of the
Credit Agreement, the Notes, any other Loan Documents or this Pledge Agreement.
7. Rights of the Administrative Agent.
(a) If an Event of Default shall occur and be continuing and the
Administrative Agent shall give notice of its intent to exercise such rights to
the Pledgor, (i) the Administrative Agent shall have the right to receive any
and all cash dividends paid in respect of the Pledged Stock and make application
thereof to the Secured Obligations, in the order set forth in Section 10 of the
Security Agreement and (ii) all shares of the Pledged Stock shall be registered
in the name of the Administrative Agent or its nominee, and the Administrative
Agent or its nominee may thereafter exercise (A) all voting, corporate and other
rights pertaining to such shares of the Pledged Stock at any meeting of
shareholders of the applicable Issuer or otherwise and (B) any
and all rights of conversion, exchange, subscription and any other rights,
privileges or options pertaining to such shares of the Pledged Stock as if it
were the absolute owner thereof (including, without limitation, the right to
exchange at its discretion any and all of the Pledged Stock upon the merger,
consolidation, reorganization, recapitalization or other fundamental change in
the corporate structure of the applicable Issuer, or upon the exercise by the
Pledgor or the Administrative Agent of any right, privilege or option pertaining
to such shares of the Pledged Stock, and in connection therewith, the right to
deposit and deliver any and all of the Pledged Stock with any committee,
depositary, transfer agent, registrar or other designated agency upon such terms
and conditions as it may determine), all without liability except to account for
property actually received by it, but the Administrative Agent shall have no
duty to the Pledgor to exercise any such right, privilege or option and shall
not be responsible for any failure to do so or delay in so doing.
(b) The rights of the Administrative Agent and the Lenders hereunder
shall not be conditioned or contingent upon the pursuit by the Administrative
Agent or any Lender of any right or remedy against the Pledgor or against any
other Person which may be or become liable in respect of all or any part of the
Secured Obligations or against any collateral security therefor, guarantee
therefor or right of offset with respect thereto. Neither the Administrative
Agent nor any Lender shall be liable for any failure to demand, collect or
realize upon all or any part of the Collateral or for any delay in doing so, nor
shall the Administrative Agent be under any obligation to sell or otherwise
dispose of any Collateral upon the request of the Pledgor or any other Person or
to take any other action whatsoever with regard to the Collateral or any part
thereof.
8. Remedies. If an Event of Default shall occur and be continuing, with
the consent of the Required Lenders, the Administrative Agent may, and upon the
request of the Required Lenders, the Administrative Agent shall, exercise on
behalf of itself and the Lenders, all rights and remedies granted in this Pledge
Agreement and in any other instrument or agreement securing, evidencing or
relating to the Secured Obligations, and in addition thereto, all rights and
remedies of a secured party under the Code. Without limiting the generality of
the foregoing with regard to the scope of the Administrative Agent's remedies,
the Administrative Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon the Pledgor, any Issuer or any
other Person (all and each of which demands, defenses, advertisements and
notices are hereby waived), may in such circumstances forthwith collect,
receive, appropriate and realize upon the Collateral, or any part thereof,
and/or may forthwith sell, assign, give option or options to purchase or
otherwise dispose of and deliver the Collateral or any part thereof (or contract
to do any of the foregoing), in one or more parcels at public or private sale or
sales, in the over-the-counter market, at any exchange, broker's board or office
of the Administrative Agent or any Lender or elsewhere upon such terms and
conditions as it may deem advisable and at such prices as it may deem best, for
cash or on credit or for future delivery without assumption of any credit risk.
The Administrative Agent or any Lender shall have the right upon any such public
sale or sales, and, to the extent permitted by law, upon any such private sale
or sales, to purchase the whole or any part of the Collateral so sold, free of
any right or equity of redemption in the
Pledgor, which right or equity is hereby waived or released. The Administrative
Agent shall apply any Proceeds from time to time held by it and the net proceeds
of any such collection, recovery, receipt, appropriation, realization or sale,
after deducting all reasonable costs and expenses of every kind incurred in
respect thereof or incidental to the care or safekeeping of any of the
Collateral or in any way relating to the Collateral or the rights of the
Administrative Agent and the Lenders hereunder, including, without limitation,
reasonable attorneys' fees and disbursements of counsel thereto, to the payment
in whole or in part of the Secured Obligations, in the order set forth in
Section 10 of the Security Agreement, and only after such application and after
the payment by the Administrative Agent of any other amount required by any
provision of law, including, without limitation, Section 9-504(1)(c) of the
Code, need the Administrative Agent account for the surplus, if any, to the
Pledgor. To the extent permitted by applicable law, the Pledgor waives all
claims, damages and demands it may acquire against the Administrative Agent or
any Lender arising out of the exercise by them of any rights hereunder. If any
notice of a proposed sale or other disposition of Collateral shall be required
by law, such notice shall be deemed reasonable and proper if given at least 10
days before such sale or other disposition. The Pledgor further waives and
agrees not to assert any rights or privileges which it may acquire under Section
9-112 of the Code.
9. Registration Rights; Private Sales.
(a) If the Administrative Agent shall determine to exercise its right
to sell any or all of the Pledged Stock pursuant to Section 8 hereof, and if in
the opinion of the Administrative Agent it is necessary or advisable to have the
Pledged Stock, or that portion thereof to be sold, registered under the
provisions of the Securities Act of 1933, as amended (the "Securities Act"), the
Pledgor will cause the applicable Issuer to (i) execute and deliver, and cause
the directors and officers of the applicable Issuer to execute and deliver, all
such instruments and documents, and do or cause to be done all such other acts
as may be, in the opinion of the Administrative Agent, necessary or advisable to
register the Pledged Stock, or that portion thereof to be sold, under the
provisions of the Securities Act, (ii) to use its best efforts to cause the
registration statement relating thereto to become effective and to remain
effective for a period of one year from the date of the first public offering of
the Pledged Stock, or that portion thereof to be sold, and (iii) to make all
amendments thereto and/or to the related prospectus which, in the opinion of the
Administrative Agent, are necessary or advisable, all in conformity with the
requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto. The Pledgor agrees to
cause the applicable Issuer to comply with the provisions of the securities or
"Blue Sky" laws of any and all jurisdictions which the Administrative Agent
shall designate and to make available to its security holders, as soon as
practicable, an earnings statement (which need not be audited) which will
satisfy the provisions of Section 11(a) of the Securities Act.
(b) The Pledgor recognizes that the Administrative Agent may be unable
to effect a public sale of any or all the Pledged Stock, by reason of certain
prohibitions contained in the Securities Act and applicable state securities
laws or otherwise, and may be compelled to resort to one or more private sales
thereof to a restricted group of purchasers which will be obliged 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 and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that, in the event the Administrative
Agent is unable to effect a public sale, any such private sale shall be deemed
to have been made in a commercially reasonable manner. The Administrative Agent
shall be under no obligation to delay a sale of any of the Pledged Stock for the
period of time necessary to permit the applicable Issuer to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if the applicable Issuer would agree to do so.
(c) The Pledgor further agrees to use its best efforts to do or cause
to be done all such other acts as may be necessary to make such sale or sales of
all or any portion of the Collateral pursuant to this Section 9 valid and
binding and in compliance with any and all other Applicable Laws. The Pledgor
further agrees that a breach of any of the covenants contained in this Section 9
will cause irreparable injury to the Administrative Agent and the Lenders not
compensable in damages, that the Administrative Agent and the Lenders have no
adequate remedy at law in respect of such breach and, as a consequence, that
each and every covenant contained in this Section 9 shall be specifically
enforceable against the Pledgor, and the Pledgor hereby waives and agrees not to
assert any defenses against an action for specific performance of such covenants
except for a defense that no Event of Default has occurred under the Credit
Agreement.
10. Amendments, etc. With Respect to the Secured Obligations. The
Pledgor shall remain obligated hereunder, and the Collateral shall remain
subject to the Lien granted hereby, notwithstanding that, without any
reservation of rights against the Pledgor, and without notice to or further
assent by the Pledgor, any demand for payment of any of the Secured Obligations
made by the Administrative Agent or any Lender may be rescinded by the
Administrative Agent or such Lender, and any of the Secured Obligations
continued, and the Secured Obligations, or the liability of the Pledgor or any
other Person upon or for any part thereof, or any collateral security or
guarantee therefor or right of offset with respect thereto, may, from time to
time, in whole or in part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered, or released by the Administrative Agent or any
Lender, and the Credit Agreement, the Notes, any other Loan Documents and any
other documents executed and delivered in connection therewith may be amended,
modified, supplemented or terminated, in whole or part, as the Lenders (or the
Required Lenders, as the case may be) may deem advisable from time to time, and
any guarantee, right of offset or other collateral security at any time held by
the Administrative Agent or any Lender for the payment of the Secured
Obligations may be sold, exchanged, waived, surrendered or released. Neither the
Administrative Agent nor any Lender shall have any obligation to protect,
secure, perfect or insure any other Lien at any time held by it as security for
the Secured Obligations or any property subject thereto. The Pledgor waives any
and all notice of the creation, renewal, extension or accrual of any of the
Secured Obligations and notice of or proof of reliance by the Administrative
Agent or any Lender upon this Pledge Agreement; the Secured Obligations, and any
of them, shall conclusively be deemed to have been created, contracted or
incurred in reliance upon this Pledge Agreement; and all dealings
between the Pledgor, on the one hand, and the Administrative Agent and the
Lenders, on the other, shall likewise be conclusively presumed to have been had
or consummated in reliance upon this Pledge Agreement. The Pledgor waives
diligence, presentment, protest, demand for payment and notice of default or
nonpayment to or upon the Pledgor with respect to any of the Secured
Obligations.
11. Regulatory Approval. The Pledgor will, at its expense, promptly
execute and deliver, or cause the execution and delivery of, all applications,
certificates, instruments, registration statements and all other documents and
papers the Administrative Agent may reasonably request or as may be required by
law in connection with the obtaining of any consent, approval, registration,
qualification or authorization of the FCC, CRTC, DTI, OFTEL, the Regulating
Authority for Telecommunications and Postal Services (Regulierungsbehorde fur
Telekommunikation und Post) and any applicable PUC (collectively, the
"Regulatory Authorities") or of any other Person necessary or appropriate for
the effective exercise of any rights under this Pledge Agreement. Without
limiting the generality of the foregoing, if an Event of Default shall have
occurred and be continuing, the Pledgor shall take any action which the
Administrative Agent may reasonably request in order to transfer and assign to
the Administrative Agent, or to such one or more third parties as the
Administrative Agent may designate, or to a combination of the foregoing, each
Communications License and PUC Authorization. To enforce the provisions of this
Section, upon the occurrence and during the continuance of an Event of Default,
the Administrative Agent is empowered to request the appointment of a receiver
from any court of competent jurisdiction. Such receiver shall be instructed to
seek from the Regulatory Authorities an involuntary transfer of control of each
such Communications License and PUC Authorization for the purpose of seeking a
bona fide purchaser to whom control will ultimately be transferred. The Pledgor
hereby agrees to authorize such an involuntary transfer of control upon the
request of the receiver so appointed and, if the Pledgor shall refuse to
authorize the transfer, its approval may be required by the court. Upon the
occurrence and during the continuance of an Event of Default, the Pledgor shall
further use its best efforts to assist in obtaining approval of the Regulatory
Authorities, if required, for any action or transactions contemplated by this
Pledge Agreement including, without limitation, the preparation, execution and
filing with the Regulatory Authorities of the assignor's or transferor's portion
of any application or applications for consent to the assignment of any
Communications License and PUC Authorizations or transfer of control necessary
or appropriate under the rules and regulations of the Regulatory Authorities for
the approval of the transfer or assignment of any portion of the Collateral,
together with any Communications License and applicable PUC Authorizations. The
Pledgor acknowledges that the assignment or transfer of each Communications
License and applicable PUC Authorizations is integral to the Administrative
Agent's and the Lenders' realization of the value of the Collateral, that there
is no adequate remedy at law for failure by the Pledgor to comply with the
provisions of this Section and that such failure would cause irreparable injury
not adequately compensable in damages, and therefore agrees that each and every
covenant contained in this Section may be specifically enforced, and the Pledgor
hereby waives and agrees not to assert any defenses against an action for
specific performance of such covenants.
12. Limitation on Duties Regarding Collateral. The Administrative
Agent's sole duty with respect to the custody, safekeeping and physical
preservation of the Collateral in its possession, under Section 9-207 of the
Code or otherwise, shall be to deal with it in the same manner as the
Administrative Agent deals with similar securities and property for its own
account. Neither the Administrative Agent, any Lender nor any of their
respective directors, officers, employees or agents shall be liable for failure
to demand, collect or realize upon any of the Collateral or for any delay in
doing so or shall be under any obligation to sell or otherwise dispose of any
Collateral upon the request of the Pledgor or otherwise.
13. Powers Coupled with an Interest. All authorizations and agencies
herein contained with respect to the Collateral constitute irrevocable powers
coupled with an interest.
14. Severability. Any provision of this Pledge Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
15. Paragraph Headings. The paragraph headings used in this Pledge
Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation hereof.
16. No Waiver; Cumulative Remedies. Neither the Administrative Agent
nor any Lender shall by any act (except by a written instrument pursuant to
Section 17 hereof) be deemed to have waived any right or remedy hereunder or to
have acquiesced in any Default or Event of Default or in any breach of any of
the terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
power or privilege hereunder shall operate as a waiver thereof. No single or
partial exercise of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Administrative Agent or any Lender of any right or
remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which the Administrative Agent or such Lender would otherwise
have on any future occasion. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other rights or remedies provided by law.
17. Waivers and Amendments; Successors and Assigns; Governing Law. None
of the terms or provisions of this Pledge Agreement may be amended, supplemented
or otherwise modified except by a written instrument executed by the Pledgor and
the Administrative Agent; PROVIDED that any consent by the Administrative Agent
to any waiver, amendment, supplement or modification hereto shall be subject to
approval thereof by the Lenders or Required Lenders, as applicable, in
accordance with Section 14.11 of the Credit Agreement. This Pledge Agreement
shall be binding upon the successors and assigns of the Pledgor and shall inure
to the benefit of the Administrative Agent and the Lenders and their respective
successors and assigns. This
Pledge Agreement shall be governed by, and construed and interpreted in
accordance with, the laws of the State of North Carolina.
18. Notices. All notices and communications hereunder shall be given to
the addresses and otherwise in accordance with Section 14.1 of the Credit
Agreement.
19. Irrevocable Authorization and Instruction to Issuers. The Pledgor
hereby authorizes and instructs each Issuer to comply with any instruction
received by it from the Administrative Agent in writing that (a) states that an
Event of Default has occurred and is continuing and (b) is otherwise in
accordance with the terms of this Pledge Agreement, without any other or further
instructions from the Pledgor, and the Pledgor agrees that such Issuer shall be
fully protected in so complying.
20. Authority of Administrative Agent. The Pledgor acknowledges that
the rights and responsibilities of the Administrative Agent under this Pledge
Agreement with respect to any action taken by the Administrative Agent or the
exercise or non-exercise by the Administrative Agent of any option, voting
right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Pledge Agreement shall, as between the
Administrative Agent and the Lenders, be governed by the Credit Agreement and by
such other agreements with respect thereto as may exist from time to time among
them, but, as between the Administrative Agent and the Pledgor, the
Administrative Agent shall be conclusively presumed to be acting as agent for
itself and the Lenders with full and valid authority so to act or refrain from
acting, and neither the Pledgor nor any Issuer shall be under any obligation, or
entitlement, to make any inquiry respecting such authority.
21. Consent to Jurisdiction. The Pledgor hereby irrevocably consents to
the personal jurisdiction of the state and federal courts located in Mecklenburg
County, North Carolina, in any action, claim or other proceeding arising out of
or any dispute in connection with this Pledge Agreement, any rights or
obligations hereunder, or the performance of such rights and obligations. The
Pledgor hereby irrevocably consents to the service of a summons and complaint
and other process in any action, claim or proceeding brought by the
Administrative Agent or any Lender in connection with this Pledge Agreement, any
rights or obligations hereunder, or the performance of such rights and
obligations, on behalf of itself or its property, in the manner provided in
Section 14.1 of the Credit Agreement. Nothing in this Section 21 shall affect
the right of the Administrative Agent or any Lender to serve legal process in
any other manner permitted by Applicable Law or affect the right of the
Administrative Agent or any Lender to bring any action or proceeding against the
Pledgor or its properties in the courts of any other jurisdictions.
22. Binding Arbitration; Waiver of Jury Trial.
(a) Binding Arbitration. If in the reasonable determination of the
Administrative Agent and its counsel, Section 22(b) is unenforceable under North
Carolina law unless paired with a binding arbitration provision, then upon
demand of any party made within ninety (90)
days after institution of any judicial proceeding, any dispute, claim or
controversy between a Lender (or group of Lenders) and a Borrower (or group of
Borrowers) (but not any dispute, claim or controversy among any Lenders not
involving any Borrower) arising out of, connected with or relating to this
Pledge Agreement ("Disputes"), between or among parties to this Pledge Agreement
shall be resolved by binding arbitration as provided herein. Institution of a
judicial proceeding by a party does not waive the right of that party to demand
arbitration hereunder. Disputes may include, without limitation, tort claims,
counterclaims, claims brought as class actions, claims arising from supplements
to this Pledge Agreement executed in the future, or claims concerning any aspect
of the past, present or future relationships arising out of or connected with
this Pledge Agreement. Arbitration shall be conducted under and governed by the
Commercial Financial Disputes Arbitration Rules (the "Arbitration Rules") of the
American Arbitration Association and Title 9 of the U.S. Code. All arbitration
hearings shall be conducted in Charlotte, North Carolina. The expedited
procedures set forth in Rule 51, et seq. of the Arbitration Rules shall be
applicable to claims of less than $1,000,000. All applicable statutes of
limitation shall apply to any Dispute. A judgment upon the award may be entered
in any court having jurisdiction. The panel from which all arbitrators are
selected shall be comprised of licensed attorneys. The single arbitrator
selected for expedited procedure shall be a retired judge from the highest court
of general jurisdiction, state or federal, of the state where the hearing will
be conducted.
(b) Jury Trial. EACH AGENT, LENDER AND THE PLEDGOR HEREBY IRREVOCABLY
WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY ACTION, CLAIM
OR OTHER PROCEEDING ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS
AGREEMENT, THE NOTES OR THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS
HEREUNDER OR THEREUNDER, OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS.
(c) Preservation of Certain Remedies. Notwithstanding the preceding
binding arbitration provisions, the parties hereto preserve, without diminution,
certain remedies that such Persons may employ or exercise freely, either alone,
in conjunction with or during a Dispute. Each such Person shall have and hereby
reserves the right to proceed in any court of proper jurisdiction or by self
help to exercise or prosecute the following remedies: (i) all rights to
foreclose against any real or personal property or other security by exercising
a power of sale granted in this Pledge Agreement or under applicable law or by
judicial foreclosure and sale, (ii) all rights of self help including peaceful
occupation of property and collection of rents, set off, and peaceful possession
of property, (iii) obtaining provisional or ancillary remedies including
injunctive relief, sequestration, garnishment, attachment, appointment of
receiver and in filing an involuntary bankruptcy proceeding, and (iv) when
applicable, a judgment by confession of judgment. Preservation of these remedies
does not limit the power of an arbitrator to grant similar remedies that may be
requested by a party in a Dispute.
[Signature Page Follows]
IN WITNESS WHEREOF, the undersigned has caused this Pledge Agreement to
be duly executed and delivered as of the date first above written.
[CORPORATE SEAL] ACC CORP.
By:________________________________
Name:______________________________
Title:_____________________________
ACKNOWLEDGEMENT AND CONSENT
Each Issuer of Pledged Stock referred to in the foregoing Pledge
Agreement hereby acknowledges receipt of a copy thereof and agrees to be bound
thereby and to comply with the terms thereof insofar as such terms are
applicable to it. Each Issuer agrees to notify the Administrative Agent promptly
in writing of the occurrence of any of the events described in Section 5(a) of
the Pledge Agreement. Each United States Subsidiary further agrees that the
terms of Section 9 of the Pledge Agreement shall apply to it, mutatis mutandis,
with respect to all actions that may be required of it under or pursuant to or
arising out of Section 9 of the Pledge Agreement.
ACC LONG DISTANCE CORP.
By:________________________________
Name:______________________________
Title:_____________________________
ACC NATIONAL TELECOM CORP.
By_________________________________
Name:______________________________
Title:_____________________________
ACC RADIO CORP.
By:________________________________
Name:______________________________
Title:_____________________________
ACC GLOBAL CORP.
By:________________________________
Name:______________________________
Title:_____________________________
ACC NATIONAL LONG DISTANCE CORP.
By:________________________________
Name:______________________________
Title:_____________________________
ACC CREDIT CORP.
By:________________________________
Name:______________________________
Title:_____________________________
ACC SERVICE CORP.
By:________________________________
Name:______________________________
Title:_____________________________
ACC TELENTERPRISES LTD.
By:________________________________
Name:______________________________
Title:_____________________________
ACC LONG DISTANCE U.K. LTD.
By:________________________________
Name:______________________________
Title:_____________________________
SCHEDULE 1
To Pledge
Agreement
DESCRIPTION OF PLEDGED STOCK
Domestic Subsidiaries
Issuer Class of Stock Certificate No. No. of Shares
ACC Long
Distance
Corp. Common 1 200
ACC National
Telecom
Corp. Common 1 1
ACC Radio
Corp. Common 1 200
ACC Global
Corp. Common 2 1
ACC National
Long
Distance
Corp. Common 1 1
Common 3 4
ACC Credit Corp. Common 2 1
ACC Service Corp. Common 2 1
Foreign Subsidiaries
Issuer Class of Stock Certificate No. No. of Shares
ACC Tel-
Enterprises
Ltd. Common C-1 66
ACC Long
Distance
U.K. Ltd. Common 10 2,000,000
Common 7 3,999,401
PLEDGE AGREEMENT SUPPLEMENT
PLEDGE AGREEMENT SUPPLEMENT, dated as of _______________, 199_ (the
"Supplement"), made by _________, a ________________ corporation (the
"Pledgor"), in favor of First Union National Bank, a national banking
association, as Administrative Agent (in such capacity, the "Administrative
Agent"), under the Credit Agreement (as defined in the Pledge Agreement referred
to below) for the benefit of itself and the Lenders (as so defined).
1. Reference is hereby made to that Pledge Agreement, dated as of
___________ ___, 1996, made by the Pledgor in favor of the Administrative Agent
(as further amended, restated or otherwise modified, the "Pledge Agreement").
This Supplement supplements the Pledge Agreement, forms a part thereof and is
subject to the terms thereof. Terms defined in the Pledge Agreement are used
herein as therein defined.
2. The Pledgor hereby confirms and reaffirms the security interest in
the Collateral granted to the Administrative Agent for the ratable benefit of
itself and the Lenders under the Pledge Agreement, and, as additional collateral
security for the prompt and complete payment when due (whether at stated
maturity, by acceleration or otherwise) of the Secured Obligations and in order
to induce the Lenders to make their Loans under the Credit Agreement, the
Pledgor hereby delivers to the Administrative Agent, for the benefit of the
Lenders, [all of the issued and outstanding shares of capital stock of [INSERT
NAME OF NEW DOMESTIC SUBSIDIARY]] or [66.66% of the issued and outstanding
shares of capital stock of [INSERT NAME OF NEW FOREIGN SUBSIDIARY]] (the "New
Issuer") listed below, together with all stock certificates, options, or rights
of any nature whatsoever which may be issued or granted by the New Issuer in
respect to such stock which the Pledge Agreement, as supplemented hereby, is in
force (the "Additional Pledged Stock"; as used in the Pledge Agreement as
supplemented by this Supplement, "Pledged Stock" shall be deemed to include the
Additional Pledged Stock) and hereby grants to the Administrative Agent, for the
ratable benefit of itself and the Lenders, a first priority security interest in
the Additional Pledged Stock and all Proceeds thereof.
3. The Pledgor hereby represents and warrants that the representations
and warranties contained in paragraph 5 of the Pledge Agreement are true and
correct on the date of this Supplement with references therein to the "Pledged
Stock" to include the Additional Pledged Stock, with references therein to the
"Issuer" to include the New Issuer, and with references to the "Pledge
Agreement" to mean the Pledge Agreement as supplemented by this Supplement.
4. The Pledgor shall deliver to the Administrative Agent the
Acknowledgement and Consent attached hereto duly executed by the New Issuer. The
Additional Pledged Stock pledged hereby is as follows which Pledged Stock shall
be deemed part of Schedule 1 thereto:
DESCRIPTION OF PLEDGED STOCK
Issuer Class of Stock Certificate No. No. of Shares
5. The Pledgor hereby agrees to deliver to the Administrative Agent
such certificates and other documents and take such other action as shall be
reasonably requested by the Administrative Agent in order to effectuate the
terms hereof and the Pledge Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Supplement to be
duly executed under seal and delivered as of the date first above written.
[CORPORATE SEAL] ____________________________________
By__________________________________
Name:_______________________________
Title:______________________________
ACKNOWLEDGEMENT AND CONSENT OF NEW ISSUER
The undersigned hereby acknowledges receipt of a copy of the foregoing
Supplement and the Pledge Agreement referred to therein (the "Pledge
Agreement"). The undersigned agrees for the benefit of the Administrative Agent
and the Lenders as follows:
1. The undersigned will be bound by the terms of the Pledge Agreement
and will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify the Administrative Agent promptly in
writing of the occurrence of any of the events described in Section 5(a) of the
Pledge Agreement.
[3. The Issuer further agrees that the terms of Section 9 of the Pledge
Agreement shall apply to it, mutatis mutandis, with respect to all actions that
may be required of it under or pursuant to or arising out of Section 9 of the
Pledge Agreement.] [ONLY INCLUDE FOR DOMESTIC SUBSIDIARIES]
[NAME OF NEW ISSUER]
By:_________________________________
Name:____________________________
Title:___________________________
