PLEDGE AGREEMENT
PLEDGE AGREEMENT (this "Agreement") is dated as of July 10,
1999, between the XXXXXXX XXXXXX CONTINUED TRUST (the "Pledgor"), and CITIBANK,
N.A., a national banking association, in its capacity as collateral agent (the
"Agent") for and representative of CITICORP USA, INC., a Delaware corporation
(the "Lender"). Each initially capitalized term which is used herein but not
otherwise defined shall have the meaning given such term in the Note referred to
below.
W I T N E S S E T H T H A T :
WHEREAS, pursuant to that certain line of credit letter
agreement dated July 10, 1999 (as such agreement may be amended, modified,
supplemented or restated from time to time, the "Letter Agreement") between the
Mainland Trading Ltd., a Jamaican corporation, and Spanish Town Hardware Ltd., a
Jamaican corporation (collectively, the "Borrowers"), and the Lender, the Lender
has agreed to make an uncommitted line of credit available to the Borrowers in a
principal amount not to exceed US$1,000,000.00 at any time outstanding (the
"Line of Credit"), with advances thereunder to be evidenced by a Demand Note of
even date herewith (the "Note"); and
WHEREAS, the Lender has required as a condition, among others,
to making the Line of Credit available to the Borrowers, that the Pledgor
guaranty repayment of the indebtedness evidenced by the Note pursuant to the
terms and conditions of a Limited Guaranty of even date herewith (the
"Guaranty"); and
WHEREAS, in order to secure the prompt and complete payment,
observance and performance of all of the indebtedness, obligations and
liabilities of the Pledgor owing to the Lender under the Guaranty or this
Agreement (all such indebtedness, obligations and liabilities being collectively
referred to herein as the "Liabilities"), the Lender is requiring that the
Pledgor execute and deliver this Agreement to the Agent; and
WHEREAS, the Pledgor is the owner of those shares of the
issued and outstanding common stock of Carnival Corp. (the "Company"), which are
more fully described on Exhibit A attached hereto.
NOW, THEREFORE, for and in consideration of the foregoing and
of any financial accommodations or extensions of credit heretofore, now or
hereafter made to or for the benefit of the Borrowers by the Lender and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Grant of Security Interest. The Pledgor hereby grants to
the Agent, for the benefit of the Lender, as security for the prompt and
complete payment, observance and performance of the Liabilities, together with
all obligations of the Pledgor to the Agent hereunder, a security interest in
(i) all of the shares of the common stock of the Company which are described on
the attached Exhibit A, together with all of the shares of the common stock of
the Company which may hereafter be pledged to the Agent pursuant to the Letter
Agreement (such shares of stock of the Company being collectively referred to
herein as the "Pledged Shares"), and (ii) all proceeds thereof (the Pledged
Shares, together with the "Powers" (as defined below), the property and
interests in property described in paragraphs 7 and 8 below, dividends and
distributions payable with respect to the Pledged Shares pursuant to paragraph 4
below, and all proceeds of any of the foregoing, being hereinafter collectively
referred to as the "Pledged Collateral"). The Pledgor agrees to execute and
deliver to the Agent (a) stock powers in the form of Exhibit B attached hereto
and made a part hereof, appropriately endorsed in blank, with respect to the
Pledged Shares constituting certificated securities, and (b) such other
documents of transfer as the Agent may from time to time request to enable the
Agent to transfer the Pledged Shares into its name or the name of its nominee,
or to register any of the Pledged Collateral to the Agent or its nominee (all of
the foregoing are hereinafter collectively referred to as the "Powers").
1
2. Perfection of Security Interest. The Pledgor agrees (i)
immediately to deliver to the Agent or the Agent's nominee all certificates
evidencing any of the Pledged Collateral which may at any time come into the
possession of the Pledgor, (ii) to execute and deliver to the Agent such
financing statements as the Agent may request with respect to the Pledged
Collateral, and (iii) to take such other steps as the Agent may from time to
time reasonably request to perfect the Agent's security interest in the Pledged
Collateral under applicable law, including, with respect to any portion of the
Pledged Collateral which may constitute "investment property" (as defined in the
UCC) causing the Agent's security interest as such Collateral to be perfected by
"control" (as defined in the UCC).
3. Voting Rights. During the term of this Agreement, the
Pledgor shall have the right to vote the Pledged Shares and to exercise any
voting rights pertaining thereto (which may be registered on the books and
records of the Company in its name except as otherwise provided in paragraph 10
below), and to give consents, ratifications and waivers with respect thereto.
The Agent shall, at the request of the Pledgor, provide it with appropriate
proxies and any other documents necessary or appropriate to permit it to
exercise the rights set forth in the preceding sentence. At such time as the
indebtedness evidenced by the Note or any Other Note is due and payable in full
("Maturity"), the Agent shall be entitled, at the Agent's option and following
written notice from the Agent to the Pledgor, to exercise all voting powers
pertaining to the Pledged Shares and to give, exclusively, consents,
ratifications and waivers with respect thereto for all purposes.
4. Dividends and Other Distributions. Except as provided in
paragraph 7 hereof, during the term of this Agreement, the Pledgor shall be
entitled to directly receive all dividends and distributions paid in respect of
the Pledged Collateral. Concurrently with its execution and delivery of this
Agreement, the Pledgor shall execute and deliver to the Agent a notice to the
Company substantially in the form of Exhibit C attached hereto (the "Dividends
and Distributions Notice"). The Dividends and Distributions Notice shall
instruct the Company to remit all dividends and other distributions payable with
respect to the Pledged Collateral to the Agent. Such Dividends and Distributions
Notice shall be held by the Agent until the Agent notifies the Pledgor that (i)
Maturity has occurred, and (ii) the Agent is sending the Dividends and
Distributions Notice to the Company. Such notification by the Agent to the
Pledgor shall in all respects be undertaken in compliance with paragraph 15 of
the Note. All dividends and/or distributions remitted to the Agent shall be
applied to the Liabilities.
2
5. Representations and Warranties. The Pledgor represents and
warrants to the Agent, for the benefit of the Lender, as follows:
(a) The Pledgor is the sole legal and beneficial
owner of each of the Pledged Shares and each of the Pledged Shares is
free and clear of any security interest, lien, pledge or other charge
or encumbrance (or any other type of preferential arrangement) except
such as may exist in favor of the Lender, arising pursuant to this
Agreement;
(b) The Pledgor has full power and authority to enter
into this Agreement;
(c) There are no restrictions upon the pledge or
other transfer of any of the Pledged Shares nor upon the sale of any of
the Pledged Shares by the Lender (whether pursuant to securities laws
or regulations or shareholder, lock-up or other similar agreements)
except as reflected on the face of any certificates evidencing the
Pledged Shares;
(d) The Pledgor has the right, subject to the
provisions of this Agreement and the Note, (i) to vote the Pledged
Shares, and (ii) to pledge and grant a security interest in all or any
part of the Pledged Shares free of any lien or other charge,
encumbrance or restriction;
(e) The Pledgor has the right (subject, however, to
the Securities Act of 1933) to otherwise transfer all or any part of
the Pledged Collateral free of any lien or other charge, encumbrance or
restriction;
(f) The Pledged Shares do not represent more than
five percent (5%) of the issued and outstanding common stock of the
Company;
(g) The Pledged Shares have been duly authorized, are
fully-paid and non-assessable and the certificates evidencing the
Pledged Shares have been registered to the Pledgor for more than one
year;
(h) The Company is current with respect to all of its
SEC filings; and
(i) The Powers are duly executed and give the Agent
the authority they purport to confer.
6. Subsequent Changes Affecting Pledged Collateral. The
Pledgor represents to the Agent that the Pledgor has made arrangements for
keeping informed of changes or potential changes affecting the Pledged
Collateral (including, but not limited to, rights to convert, rights to
subscribe, payment of dividends, reorganization or other exchanges, tender
offers and voting rights), and the Pledgor agrees that neither the Agent nor the
Lender shall have any responsibility or liability for informing the Pledgor of
any such changes or potential changes or for taking any action or omitting to
take any action with respect thereto.
7. Pledged Shares Adjustments. In the event that, during the
term of this Agreement, any stock dividend, reclassification, readjustment or
other change is declared or made in the capital structure of the Company
(including, without limitation, the issuance of additional shares of common
stock of the Company), then the Agent shall have a security interest in all
equity and non-equity securities issued to or acquired by the Pledgor in respect
of the Pledged Collateral by reason of any such change or exercise, and such
shares or other securities, shall be delivered to the Agent or the Agent's
nominee and become part of the Pledged Collateral.
3
8. Warrants, Options and Other Rights. In the event that,
during the term of this Agreement, subscription warrants or any other rights or
options shall be issued by the Company in connection with the Pledged Collateral
or otherwise issued to or acquired by the Pledgor, then the Agent shall have a
security interest in such warrants, rights and options, and such warrants,
rights and options shall become part of the Pledged Collateral.
9. Waivers. The Pledgor hereby waives any requirement of
diligence, presentment, demand of payment, filing of claims with a court in the
event of a receivership or bankruptcy of the Borrower, protest or notice with
respect to the Liabilities, the benefit of any statutes of limitation, and all
demands whatsoever (and shall not require that the same be made on the Pledgor
as a condition precedent to the Pledgor's liabilities hereunder), and covenants
that the Pledgor will not be discharged of liabilities under this Agreement,
except as provided in paragraph 11.
10. Remedies of Agent upon Maturity. The Agent may, upon
Maturity, at its option, transfer or register the Pledged Collateral or any part
thereof into its or its nominee's name with or without any indication that such
Pledged Collateral is subject to the security interest hereunder. The Pledgor
hereby appoints the Agent as its attorney-in-fact to arrange at the Agent's
option for such transfer. The Agent shall have, in addition to the foregoing and
any other rights given under this Agreement or by law, all of the rights and
remedies with respect to the Pledged Collateral of a secured party under the
UCC. In addition, upon Maturity, the Agent shall have such powers of sale and
other powers as may be conferred by applicable law. With respect to the Pledged
Collateral or any part thereof which shall then be in or shall thereafter come
into the possession or custody of the Agent or which the Agent shall otherwise
have the ability to transfer under applicable law, the Agent may, in its sole
discretion, without notice except as specified below, sell or cause the same to
be sold at any broker's board or at public or private sale, in one or more sales
or lots, at such price as the Agent may deem best, for cash or on credit or for
future delivery, without assumption of any credit risk on the part of the Agent
or the Lender and the purchaser of any or all of the Pledged Collateral so sold
shall hereafter own the same, absolutely free from any claim, encumbrance or
right of any kind whatsoever. Unless any of the Pledged Collateral threatens to
decline speedily in value or is or becomes a type sold on a recognized market,
the Agent will give the Pledgor reasonable notice of the time and place of any
public sale thereof, or of the time after which any private sale or other
intended disposition is to be made. Any sale of the Pledged Collateral conducted
in conformity with reasonable commercial practices of banks, commercial finance
companies, insurance companies or other financial institutions disposing of
property similar to the Pledged Collateral shall be deemed to be commercially
reasonable. Notwithstanding any provision to the contrary contained herein, any
requirement of reasonable notice shall be met if ten (10) Business Days' notice
of such sale or disposition is provided to the Pledgor. Any other requirement of
notice, demand or advertisement for sale is, to the extent permitted by law,
waived. The Agent or the Lender may, in its own name or in the name of a
designee or nominee, buy all or any part of the Pledged Collateral at any public
sale and, if permitted by applicable law, buy all or any part of the Pledged
Collateral at any private sale. The Pledgor will pay to the Agent all expenses
(including, without limitation, court costs and reasonable attorneys' and
paralegals' fees and expenses) of, or incident to, (i) the administration of
this Agreement, (ii) the custody or preservation of, or the sale or collection
of or other realization upon, any of the Pledged Collateral, (iii) the exercise
or enforcement of any of the rights of the Agent hereunder, or (iv) the failure
by the Pledgor to perform or observe any provision hereof. In view of the fact
that federal and state securities laws and securities laws in other foreign
jurisdictions may impose certain restrictions on the method by which a sale of
the Pledged Collateral may be effected upon Maturity, the Pledgor agrees that
the Agent may, from time to time, attempt to sell all or any part of the Pledged
Collateral by means of a private placement restricting the bidders and
prospective purchasers to those who are qualified and will represent and agree
that they are purchasing for investment only and not for distribution. In so
doing, the Agent may solicit offers to buy the Pledged Collateral, or any part
of it, from a limited number of investors deemed by the Agent, in its reasonable
judgment, to be financially responsible parties who might be interested in
purchasing the Pledged Collateral. If the Agent solicits such offers, then the
acceptance by the Agent of the highest offer obtained therefrom shall be deemed
to be a commercially reasonable method of disposing of such Pledged Collateral.
4
11. Effectiveness of Agreement. This Agreement shall remain in
full force and effect until all of the Liabilities shall have been indefeasibly
paid and satisfied in full.
12. The Agent's Exercise of Rights and Remedies upon Maturity.
Notwithstanding anything set forth herein to the contrary, it is hereby
expressly agreed that the Agent may, and upon the written direction of the
Lender, shall, exercise any of the rights and remedies provided in this
Agreement upon Maturity.
13. Definitions. The singular shall include the plural and
vice versa and any gender shall include any other gender as the context may
require.
14. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the Pledgor, the Agent and their respective
successors and assigns.
15. Applicable Law. This Agreement shall be governed by, and
construed and enforced in all respects in accordance with, the laws of the State
of New York applicable to contracts made and to be performed entirely within
such State, without giving effect to its conflicts of laws principles or rules.
Whenever possible, each provision of this Agreement shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement shall be held to be prohibited or invalid under applicable
law, such provision shall be ineffective only to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement.
16. Further Assurances. The Pledgor agrees to cooperate with
the Agent and to execute and deliver, or cause to be executed and delivered, all
such other stock powers, proxies, instruments and documents and to take all such
other actions, including, without limitation, the filing of financing
statements, as the Agent may reasonably request from time to time in order to
carry out the provisions and purposes hereof.
5
17. Consent to Jurisdiction; Waiver of Venue Objection;
Service of Process. WITHOUT LIMITING THE RIGHT OF THE AGENT TO BRING ANY ACTION
OR PROCEEDING AGAINST THE PLEDGOR OR AGAINST PROPERTY OF THE PLEDGOR ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY INDEBTEDNESS SECURED HEREBY (AN
"ACTION") IN THE COURTS OF OTHER JURISDICTIONS, THE PLEDGOR HEREBY IRREVOCABLY
SUBMITS TO AND ACCEPTS THE NON-EXCLUSIVE JURISDICTION OF ANY NEW YORK STATE
COURT OR ANY FEDERAL COURT SITTING IN NEW YORK CITY, AND THE PLEDGOR HEREBY
IRREVOCABLY AGREES THAT ANY ACTION MAY BE HEARD AND DETERMINED IN SUCH NEW YORK
STATE COURT OR IN SUCH FEDERAL COURT. THE PLEDGOR HEREBY IRREVOCABLY WAIVES AND
DISCLAIMS, TO THE FULLEST EXTENT THAT THE PLEDGOR MAY EFFECTIVELY DO SO, ANY
DEFENSE OR OBJECTION (INCLUDING, WITHOUT LIMITATION, ANY DEFENSE OR OBJECTION TO
VENUE BASED ON THE GROUNDS OF FORUM NON CONVENIENS) WHICH THE PLEDGOR MAY NOW OR
HEREAFTER HAVE TO THE MAINTENANCE OF ANY ACTION IN ANY JURISDICTION. THE PLEDGOR
HEREBY IRREVOCABLY AGREES THAT THE SUMMONS AND COMPLAINT OR ANY OTHER PROCESS IN
ANY ACTION IN ANY JURISDICTION MAY BE SERVED BY MAILING (USING CERTIFIED OR
REGISTERED MAIL, POSTAGE PREPAID) TO THE NOTICE ADDRESS OF THE PLEDGOR SET FORTH
BELOW OR BY HAND DELIVERY TO A PERSON OF SUITABLE AGE AND DISCRETION AT SUCH
ADDRESS. SUCH SERVICE WILL BE COMPLETE ON THE THIRD BUSINESS DAY AFTER SUCH
PROCESS IS SO MAILED OR ON THE DATE SUCH PROCESS IS DELIVERED, AND THE PLEDGOR
SHALL HAVE THIRTY DAYS FROM SUCH COMPLETION OF SERVICE IN WHICH TO RESPOND IN
THE MANNER PROVIDED BY LAW. THE PLEDGOR MAY ALSO BE SERVED IN ANY OTHER MANNER
PERMITTED BY LAW, IN WHICH EVENT THE PLEDGOR'S TIME TO RESPOND SHALL BE THE TIME
PROVIDED BY LAW.
18. Agent Appointed Attorney-in-Fact. The Pledgor hereby
appoints the Agent as the Pledgor's attorney-in-fact, with full authority in the
place and stead of the Pledgor and in the name of the Pledgor or otherwise, from
time to time in the Agent's discretion following Maturity to take any action and
to execute any instrument which the Agent may deem necessary or advisable to
accomplish the purposes of this Agreement, including, without limitation, to
receive, endorse and collect all instruments made payable to the Pledgor
representing any distribution, interest payment or other dividend distribution
in respect of the Pledged Collateral or any part thereof and to give full
discharge for the same. This power of attorney created under this paragraph 18,
being coupled with an interest, shall be irrevocable for the term of this
Agreement.
19. Agent's Duty. The Agent shall not be liable for any acts,
omissions, errors of judgment or mistakes of fact or law including, without
limitation, acts, omissions, errors or mistakes with respect to the Pledged
Collateral, except for those arising out of or in connection with the Agent's
(i) gross negligence or willful misconduct, or (ii) failure to use reasonable
care with respect to the safe custody of any certificate evidencing any of the
Pledged Collateral which is in the physical possession of the Agent. Without
limiting the generality of the foregoing, the Agent shall be under no obligation
to take any steps necessary to preserve rights in the Pledged Collateral against
any other parties but may do so at its option, and all expenses incurred in
connection therewith shall be for the sole account of the Pledgor, and shall be
added to the Liabilities secured hereby.
6
20. Counterparts. This Agreement may be executed in separate
counterparts, each of which shall be an original and all of which taken together
shall constitute one and the same instrument.
21. Section Headings. The section headings herein are for
convenience of reference only, and shall not affect in any way the
interpretation of any of the provisions hereof.
22. Waiver of Jury Trial. TO THE FULLEST EXTENT PERMITTED BY
LAW, THE PLEDGOR HEREBY WAIVES AND DISCLAIMS ANY RIGHT TO TRIAL BY JURY (WHICH
THE AGENT, ON BEHALF OF THE LENDER, ALSO WAIVES AND DISCLAIMS) IN ANY ACTION,
SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATING TO THIS
PLEDGE AGREEMENT, THE PLEDGED COLLATERAL, OR THE AGENT'S OR THE LENDER'S CONDUCT
IN RESPECT THEREOF.
IN WITNESS WHEREOF, the Pledgor and the Agent have executed
this Agreement as of the day and year first above written.
XXXXXXX XXXXXX CONTINUED TRUST
Dated as of July 10, 1999 By: TAF Management Company,
as Successor Trustee under Declaration
of Continued Trust for Xxxxxxx Xxxxxx,
dated December 26, 1991, as amended by
Order, dated December 21, 1992
By:______________________________________
Notice Address: Name:_________________________________
Title:________________________________
Morris, Nichols, Arsht & Xxxxxxx
0000 Xxxxx Xxxxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxx, Xx., Esq.
7
With a copy to:
Xx. Xxxxx Xxxxxxxx
000 XX 00xx Xxxxxx, Xxxxx 000
Xxxxx, Xxxxxxx 00000
and to:
Holland & Knight LLP
000 Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
CITIBANK, N.A., as Agent for the Lender
By:________________________________
Vice President
8
EXHIBIT A
TO
PLEDGE AGREEMENT
Certificate No. No. of Shares.
--------------- --------------
CC5614 100,000
9
EXHIBIT B
TO
PLEDGE AGREEMENT
[To be supplied.]
10
EXHIBIT C
TO
PLEDGE AGREEMENT
DIVIDENDS AND DISTRIBUTIONS NOTICE
July 10, 1999
Carnival Corp.
0000 X.X. 0xx Xxxxxx.
Xxxxx, Xxxxxxx 00000
Ladies and Gentlemen:
The undersigned is the record owner of certain shares of the
common stock of Carnival Corp. and has pledged 100,000 of such shares to
Citibank, N.A. as collateral agent for Citicorp USA, Inc. From and after the
date hereof and until further notice, the undersigned hereby directs you to
remit all dividends and other distributions payable with respect to such shares
directly to Citibank, N.A. at:
Citibank, N.A.
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Private Banking Division
Very truly yours,
Notice Address: XXXXXXX XXXXXX CONTINUED TRUST
Morris, Nichols, Arsht & Xxxxxxx By: TAF Management Company,
0000 Xxxxx Xxxxxx Xxxxxx as Successor Trustee under
X.X. Xxx 0000 Declaration of Continued Trust
Wilmington, Delaware 19899-1347 for Xxxxxxx Xxxxxx, dated
Attention: Xxxxxxx X. Xxxxx, Xx., Esq. December 26, 1991, as amended
by Order, dated December 21,
1992
By:___________________________
With a copy to: Name:______________________
Xx. Xxxxx Xxxxxxxx Title:_____________________
00 XX 00xx Xxxxxx, Xxxxx 000
Xxxxx, Xxxxxxx 00000
and to:
Holland & Knight LLP
000 Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
11
