EXHIBIT 4.5
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (this "Pledge Agreement"), dated as of December 10,
2004, by EMS TECHNOLOGIES, INC., a Georgia corporation (the "Borrower"), the
Subsidiaries of the Borrower signatory hereto and each other subsidiary of the
Borrower hereafter a party hereto (each a "Subsidiary Pledgor" and collectively
the "Subsidiaries Pledgors"; Borrower, each Subsidiary Pledgor and each other
Subsidiary hereafter becoming a party hereto shall be collectively known as the
"Pledgors", and individually as "Pledgor"), in favor of SUNTRUST BANK, a Georgia
banking corporation, as Collateral Agent (the "Collateral Agent"), for the
benefit of the Secured Creditors (as defined below).
WITNESSETH:
WHEREAS, the Borrower, the Lenders from time to time party thereto (the
"US Lenders") and SunTrust Bank, as Administrative Agent (the "US Agent") are
all party to the U.S. Revolving Credit Agreement (as amended, restated,
modified, extended, renewed, replaced, supplemented and/or refinanced from time
to time, the "US Credit Agreement"), dated as of the date hereof pursuant to
which, the US Lenders have agreed to establish a revolving credit facility on
behalf of the Borrower and to provide for the issuance of, and participation in,
letters of credit for the account of the Borrower;
WHEREAS, pursuant to that certain Subsidiary Guaranty Agreement dated as
of the date hereof (the "Subsidiary Guaranty Agreement"), the Subsidiaries of
the Borrower signatory thereto have jointly and severally guaranteed the payment
and performance when due of all indebtedness and other obligations of the
Borrower under the US Credit Agreement;
WHEREAS, EMS Technologies Canada, Ltd. (the "Canadian Borrower"), the
Lenders from time to time party thereto (the "Canadian Lenders") and Bank of
America, National Association (Canada Branch), as Canadian Administrative Agent,
Funding Agent and Canadian Collateral Agent (the "Canadian Agent") are all party
to the Canadian Revolving Credit Agreement (as amended, restated, modified,
extended, renewed, replaced, supplemented and/or refinanced from time to time,
the "Canadian Credit Agreement") dated as of the date hereof pursuant to which,
the Canadian Lenders have agreed to establish a revolving credit facility on
behalf of the Canadian Borrower and to provide for the issuance of, and
participation in, letters of credit for the account of the Canadian Borrower;
WHEREAS, pursuant to the Guaranty Agreement dated as of the date hereof by
the Borrower and the Subsidiaries of the Borrower a signatory thereto (the
"Canadian Guaranty Agreement"), the Borrower and the Subsidiaries of the
Borrower signatory hereto have jointly and severally guaranteed the payment and
performance when due of all indebtedness and other obligations of the Canadian
Borrower under the Canadian Credit Agreement;
WHEREAS, the Borrower and its Subsidiaries may at any time and from time
to time
enter into one or more Hedging Transactions with one or more US Lenders or any
Affiliate thereof (each such US Lender or Affiliate, even if the respective US
Lender subsequently ceases to be a US Lender under the US Credit Agreement for
any reason, in such capacity, together with its respective successors and
assigns, a "US Swap Provider");
WHEREAS, the Canadian Borrower and its Subsidiaries may at any time and
from time to time enter into one or more Hedging Transactions with one or more
Canadian Lenders or any Affiliate thereof (each such Canadian Lender or
Affiliate, even if the respective Canadian Lender subsequently ceases to be a
Canadian Lender under the Canadian Credit Agreement for any reason, in such
capacity, together with its respective successors and assigns, a "Canadian Swap
Provider" and together with the US Swap Provider, the "Swap Providers");
WHEREAS, it is a condition precedent to the obligations of the US Agent,
the Issuing Bank (as defined in the US Credit Agreement), the Swingline Lender
(as defined in the US Credit Agreement), and the US Lenders (collectively the
"US Creditors") under the US Credit Agreement that each Pledgor grant to the
Collateral Agent a security interest in all of its Pledged Collateral (as
defined below) to secure all obligations of the Borrower under the US Credit
Agreement, and to secure the obligations of each domestic Subsidiary of the
Borrower signatory hereto under the Subsidiary Guaranty Agreement;
WHEREAS, it is a condition precedent to the obligations of the Canadian
Agent, the Issuing Bank (as defined in the Canadian Credit Agreement), the
Swingline Lender (as defined in the Canadian Credit Agreement), and the Canadian
Lenders (collectively, the "Canadian Creditors", and, together with the US
Creditors and the Swap Providers, the "Secured Creditors") under the Canadian
Credit Agreement that each Pledgor grant to the Collateral Agent a security
interest in all of its Pledged Collateral to secure all obligations of the
Borrower and each Subsidiary of the Borrower signatory hereto under the Canadian
Guaranty Agreement;
WHEREAS, it is a condition precedent to the Swap Providers entering into
the Hedging Transactions that the Pledgors enter into this Agreement to secure
the Hedging Obligations (as defined herein);
WHEREAS, the Pledgors are the record and beneficial owners of all of the
issued and outstanding shares, interests, participations or other equivalent
equity ownership (however designated) of capital stock or other equity
securities ("Equity Interests") listed on Schedule I attached hereto;
WHEREAS, the Pledgors are the record and beneficial owners of the
promissory notes described on Schedule II attached hereto; and
WHEREAS, each Pledgor desires to grant a security interest in its Pledged
Collateral (as defined herein) to the Secured Creditors to satisfy the
conditions precedent set forth above.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
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1. Defined Terms. All capitalized terms used but not otherwise defined
herein have the meanings given to them in the US Credit Agreement.
2. Pledge. Each Pledgor hereby (i) pledges and grants to the Collateral
Agent, for the benefit of the US Creditors, a first priority continuing security
interest in all of such Pledgor's right, title and interest in, to and under the
following property, whether now owned by or owing to, or hereafter acquired by
or arising in favor of such Pledgor, (ii) pledges and grants to the Collateral
Agent for the benefit of the Canadian Creditors, a first priority continuing
security interest in all of such Pledgor's right, title and interest in, to and
under the following property, whether now owned by or owing to, or hereafter
acquired by or arising in favor of such Pledgor and (iii) pledges and grants to
the Collateral Agent for the benefit of the Swap Providers, a first priority
continuing security interest in all of such Pledgor's right, title and interest
in, to and under the following property, whether now owned by or owing to, or
hereafter acquired by or arising in favor of such Pledgor:
(a) The all issued and outstanding Equity Interests listed on
Schedule I attached hereto and all Equity Interests from time to time acquired
by any Pledgor or such Pledgor's designees in any manner (together, the "Pledged
Shares") and any and all certificates representing the Pledged Shares, and all
dividends, cash, instruments and other property or proceeds from time to time
received, receivable or otherwise distributed in respect of or in exchange for
any or all of the Pledged Shares;
(b) Any stock or other securities acquired by any Pledgor or such
Pledgor's designees with respect to, incident to or in lieu of the Pledged
Shares or with respect to, incident to or in lieu of the Pledged Collateral (i)
due to any dividend, stock-split, stock dividend or distribution on dissolution,
or partial or total liquidation, or for any other reason, (ii) in connection
with a reduction of capital, capital surplus or paid-in-surplus or (iii) in
connection with any spin-off, split-off, reclassification, readjustment, merger,
consolidation, sale of assets, combination of shares or any other plan of
distribution affecting of the issuer of any Pledged Shares;
(c) Any subscription or other rights or options issued in connection
with the Pledged Shares, and, if exercised by any Pledgor, all new shares or
other securities so acquired by such Pledgor, which shall promptly be assigned
and delivered to the Collateral Agent and held under the terms of this Pledge
Agreement in the same manner as the Pledged Shares originally pledged hereunder;
(d) The promissory notes described on Schedule II attached hereto
and the instruments and all additional promissory notes from time to time
acquired by the Pledgor in any manner (together, the "Pledged Notes") and the
instruments other documents representing the Pledged Notes, and all interest,
cash, instruments and other property or proceeds from time to time received,
receivable or otherwise distributed in respect of or in exchange for the Pledged
Notes; and
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(e) Any and all proceeds, monies, income and benefits arising from
or by virtue of, and all dividends and distributions (cash or otherwise) payable
and/or distributable with respect to, all or any of the Pledged Shares or other
securities and rights and interests described in this Section 2;
provided, that no Pledgor shall be required at any time to pledge hereunder (i)
more than 65% of the total combined voting power of all classes of equity
interests entitled to vote of any corporation, limited liability company,
partnership or other entity organized under the laws of a jurisdiction other
than the Untied States or any State or Territory thereof that, in any such case
is treated as a corporation or an association taxable as a corporation for U.S.
Federal income tax purposes or (ii) the limited partnership interest owned as of
the date hereof by EMS Investment Holdings, Inc. in Skybridge Limited
Partnership ((i) and (ii) together, the "Exempt Collateral").
As used herein, (a) through (e) hereinafter (excluding Exempt Collateral) shall
be collectively referred to as the "Pledged Collateral".
Notwithstanding anything to the contrary contained in this Section or
elsewhere in this Pledge Agreement, each Pledgor and the Collateral Agent (on
behalf of the Secured Creditors) acknowledges and agrees that (i) the US
Creditors' security interest in the Pledged Collateral, the Canadian Creditors'
security interests in the Pledged Collateral and the Swap Providers' security
interests in the Pledged Collateral constitute security interests separate and
apart from each other, (ii) the grants of security interest hereunder constitute
three separate and distinct grants of security, one in favor of the Collateral
Agent for the benefit of the US Creditors, the second in favor of the Collateral
Agent for the benefit of the Canadian Creditors and the third in favor of the
Collateral Agent for the benefit of the Swap Providers and (iii) in the event of
any conflict between the provisions of this Agreement and the provisions of the
Canadian Loan Documents or the Hedging Transactions, the terms of this Agreement
shall prevail.
3. Security For Secured Obligations. This Pledge Agreement and the Pledged
Collateral secure the prompt payment, in full when due, whether at stated
maturity, by acceleration or otherwise, and performance of (i) the full and
prompt payment when due (whether at the stated maturity, by acceleration or
otherwise) of all Obligations (including Obligations which, but for the
automatic stay under Section 362(a) of the Bankruptcy Code, would become due),
indebtedness and liabilities (including, without limitation, indemnities, fees
and interest thereon and all interest that accrues after the commencement of any
case, proceeding or other action relating to the bankruptcy, insolvency,
reorganization or similar proceeding of any Pledgor at the rate provided for in
the respective documentation, whether or not a claim for post-petition interest
is allowed in any such case, proceeding or other action) of such Pledgor owing
to the US Creditors, now existing or hereafter incurred under, arising out of or
in connection with the US Credit Agreement and each Loan Document to which such
Pledgor is a party (including, in the case of each Pledgor that is a Subsidiary
Loan Party, all such obligations, indebtedness and liabilities under the
Subsidiary Guaranty Agreement) and the due performance and compliance by such
Pledgor with the terms, conditions and agreements of the US Credit Agreement and
each such Loan Document (all such obligations, indebtedness and liabilities
under this clause (i), being herein collectively called the "US Obligations");
(ii) the full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of all
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"Obligations" as such term is defined in the Canadian Credit Agreement
(including obligations which, but for the automatic stay under Section 362(a) of
the Bankruptcy Code, would become due), indebtedness and liabilities (including,
without limitation, indemnities, fees and interest thereon and all interest that
accrues after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency, reorganization or similar proceeding of any
Pledgor at the rate provided for in the respective documentation, whether or not
a claim for post-petition interest is allowed in any such case, proceeding or
other action) of such Pledgor owing to the Canadian Creditors, now existing or
hereafter incurred under, arising out of or in connection with the Canadian
Guaranty Agreement and the due performance and compliance by such Pledgor with
the terms, conditions and agreements of the Canadian Guaranty Agreement (all
such obligations, indebtedness and liabilities under this clause (ii) being
herein collectively called the "Canadian Obligations"); (iii) the full and
prompt payment when due (whether at the stated maturity, by acceleration or
otherwise) of all obligations (including obligations which, but for the
automatic stay under Section 362(a) of the Bankruptcy Code, would become due),
indebtedness and liabilities (including, without limitation, indemnities, fees
and interest thereon and all interest that accrues after the commencement of any
case, proceeding or other action relating to the bankruptcy, insolvency,
reorganization or similar proceeding of any Pledgor at the rate provided for in
the respective documentation, whether or not a claim for post-petition interest
is allowed in any such case, proceeding or other action) of such Pledgor owing
to the Swap Providers, now existing or hereafter incurred under, arising out of
or in connection with each Hedging Transaction (including any buy back,
reversal, termination or assignment of any Hedging Transaction, any renewal,
extension, modification of any Hedging Transaction and any substitution for any
Hedging Transaction), whether such Hedging Transaction is now in existence or
hereafter arising, and the due performance and compliance by such Pledgor with
all of the terms, conditions and agreements contained in each such Hedging
Transaction (all such obligations, indebtedness and liabilities under this
clause (iii) being herein collectively called the "Hedging Obligations"); (iv)
any and all sums advanced by the Collateral Agent in order to preserve the
Collateral or preserve its security interest in the Collateral, and (v) in the
event of any proceeding for the collection or enforcement of any indebtedness,
obligations or liabilities of each Pledgor referred to in preceding clauses (i),
(ii) or (iii) after an Event of Default (as defined in Section 9 hereof) shall
have occurred and be continuing, the expenses of re-taking, holding, preparing
for sale or lease, selling or otherwise disposing of or realizing on the
Collateral, or of any exercise by the Collateral Agent of its rights hereunder,
together with attorneys' fees actually incurred and court costs (collectively,
the "Secured Obligations").
4. Delivery Of Pledged Collateral. All certificates, promissory notes and
instruments representing or evidencing the Pledged Collateral shall be delivered
to and held by or on behalf of the Collateral Agent pursuant hereto, including,
without limitation, certificates, notes or other instruments evidencing Pledged
Collateral acquired after the date hereof; provided, however, that the Pledgors
shall not be required to deliver to the Collateral Agent promissory notes
evidencing Pledged Collateral that are issued by one or more employees of a
Pledgor to a Pledgor and with respect to which the aggregate principal amount of
all such notes does not exceed $1,000,000. All Pledged Shares shall be
accompanied by duly executed, undated stock powers or other instruments of
transfer or assignment endorsed in blank, all in form and substance satisfactory
to the Collateral Agent and, if the Collateral Agent so requests, with
signatures guaranteed by a member of a registered national securities exchange
or the National
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Association of Securities Dealers, Inc. or by a commercial bank or trust company
having an office or correspondent in the United States. All Pledged Notes shall
be endorsed by the applicable Pledgor. The Collateral Agent shall have the right
at any time to exchange certificates or instruments representing or evidencing
Pledged Shares for certificates or instruments of smaller or larger
denominations.
5. Representations and Warranties. Each Pledgor represents and warrants to
the Collateral Agent and the Secured Creditors as follows:
(a) Each Pledgor is, and at the time of delivery of the Pledged
Shares to the Collateral Agent pursuant to Section 4 hereof will be, the sole
holder of record and the sole beneficial owner of the Pledged Collateral pledged
by such Pledgor, free and clear of any Lien thereon or affecting the title
thereto except for Liens expressly permitted under Section 7.2 of the US Credit
Agreement.
(b) All of the Pledged Shares have been duly authorized, validly
issued and are fully paid and non-assessable and all documentary, stamp, or
other taxes or fees owing in connection with the issuance, transfer and/or
pledge thereof hereunder have been paid and will be hereafter paid by each
Pledgor as same becomes due and payable.
(c) No dispute, counterclaim or defense exists with respect to all
or any part of the Pledged Collateral.
(d) Each Pledgor has the requisite corporate authority to pledge,
assign, transfer, deliver, deposit and set over its Pledged Collateral to the
Collateral Agent for the benefit of the Secured Creditors as provided herein.
(e) There are no restrictions upon the transfer, hypothecation or
pledge of any of the Pledged Collateral other than such restrictions imposed by
applicable securities laws.
(f) None of the Pledged Shares have been issued or transferred in
violation of the securities registration, securities disclosure or similar laws
of any jurisdiction to which such issuance or transfer may be subject.
(g) Schedule I hereto lists the authorized Equity Interests, the par
value thereof and the number of issued and outstanding Equity Interests of each
issuer of Pledged Shares. As of the date hereof, (i) no subscription, warrant,
option or other rights to purchase or acquire any Equity Interests of any issuer
of Pledged Shares is authorized and outstanding, and (ii) there is no commitment
by any issuer of Pledged Shares to issue any such shares, warrants, options or
other such rights or securities.
(h) Each of the Pledged Notes purported to be pledged hereunder is
the legal, valid and binding obligation of the obligor thereof, enforceable in
accordance with its terms.
(i) The pledge by each Pledgor of its Pledged Collateral is not in
contravention of any law or of any agreement to which such Pledgor is party or
by which such Pledgor is
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otherwise bound, and no consent, approval, authorization or other order of, or
other action by, any Person or notice to or filing with, any Person is required
(i) for the pledge by such Pledgor of the Pledged Collateral pursuant to this
Pledge Agreement or for the execution, delivery or performance of this Pledge
Agreement by such Pledgor or (ii) for the exercise by the Collateral Agent of
the voting or other rights provided for in this Pledge Agreement or the remedies
in respect of the Pledged Collateral pursuant to this Pledge Agreement (except
as may be required in connection with any disposition of any portion of the
Pledged Collateral by laws affecting the offering and sale of securities
generally).
(j) The pledge, assignment and delivery of the Pledged Collateral
together with duly executed, undated stock powers or other instruments of
transfer or assignment endorsed in blank pursuant to this Pledge Agreement will
create a valid first priority Lien on and a first priority perfected security
interest in the Pledged Collateral and the proceeds thereof, securing the
payment of the Secured Obligations and no filing or other action is necessary to
perfect or protect such security interest, except that (i) the filing of a
financing statement, the taking of possession or some other action may be
required under Section 9-315 of the Uniform Commercial Code as in effect in the
State of Georgia (the "UCC") to perfect a security interest in certain proceeds
of the Pledged Collateral that do not constitute Pledged Shares or other
securities or instruments and (ii) the filing of a financing statement under
Sections 9-312 and 9-314 of the UCC may be required to perfect a security
interest in any Pledged Collateral that constitutes "investment property" (other
than the Pledged Shares) with respect to which the Collateral Agent does not
have "control" (as such terms are defined in the UCC).
(k) All of the representations and warranties contained in the US
Credit Agreement, the Subsidiary Guaranty Agreement and all other documents
which are defined as "Loan Documents" under the US Credit Agreement (together
the "US Loan Documents") and in the Canadian Credit Agreement, the Canadian
Guaranty Agreement and all other documents which are defined as "Loan Documents"
under the Canadian Credit Agreement (the "Canadian Loan Documents" and,
collectively with the US Loan Documents, the "Secured Debt Documents") are true
and correct in all material respects, are incorporated herein by this reference
and are deemed to be made herein by each Pledgor for purposes of this Pledge
Agreement.
6. Covenants. Each Pledgor covenants and agrees that from and after the
date of this Pledge Agreement and until the payment and performance in full in
cash of all of the Secured Obligations:
(a) Such Pledgor shall not sell, assign, transfer, pledge or
otherwise encumber any of its rights in or to its Pledged Collateral or any
unpaid dividends or other distributions or payments with respect thereto except
pursuant to this Pledge Agreement.
(b) Such Pledgor will not cause or permit any issuer of Pledged
Shares to issue or grant any warrants, stock options of any nature or other
instruments convertible into shares of any class of capital stock or additional
shares of capital stock or sell or transfer any treasury stock.
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(c) Such Pledgor will, at its own cost and expense, promptly
execute, acknowledge and deliver all such instruments and take all such action
as the Collateral Agent from time to time may request in order to perfect and
protect the Lien granted or purported to be granted hereby or to enable the
Collateral Agent to exercise and enforce its rights and remedies hereunder with
respect to the Pledged Collateral.
(d) Such Pledgor has defended and will, at its own cost and expense,
defend the title to its Pledged Collateral and the Liens of the Collateral Agent
thereon against the claim of any Person and will maintain and preserve such
Liens.
(e) Such Pledgor will pay all taxes, assessments and charges levied,
assessed or imposed upon its Pledged Collateral before the same become
delinquent or become Liens upon any of its Pledged Collateral except where the
same may be contested in good faith by appropriate proceedings and as to which
adequate reserves have been provided.
7. Adjustments and Distributions Concerning Pledged Collateral. Should the
Pledged Collateral, or any part thereof, ever be converted in any manner by any
Pledgor into another type of property or any money or other proceeds ever be
paid or delivered to any Pledgor as a result of such Pledgor's rights in the
Pledged Collateral, then in any such event (except as expressly provided in
Section 8 hereof), all such property, money and other proceeds shall promptly be
and become part of the Pledged Collateral, and each Pledgor covenants and agrees
to forthwith pay and deliver all money so received to the Collateral Agent, for
the benefit of the Secured Creditors, as Pledged Collateral hereunder in
accordance with the provisions of the Security Agreement; and, if the Collateral
Agent deems it necessary and so requests, to properly endorse, assign or
transfer any and all such other proceeds to the Collateral Agent and to deliver
to the Collateral Agent any and all such other proceeds which require perfection
by possession under the UCC. With respect to any of such property of a kind
requiring an additional security agreement, financing statement or other writing
to perfect a security interest therein in favor of the Collateral Agent, each
Pledgor will forthwith execute and deliver to the Collateral Agent whatever the
Collateral Agent shall deem necessary or proper for such purposes.
8. Pledgors' Rights; Termination Of Rights.
(a) As long as no Event of Default shall have occurred and be
continuing:
(i) Each Pledgor shall have the right, from time to time, to
vote and give consents with respect to its Pledged Collateral or any part
thereof for all purposes permitted by the Secured Debt Documents;
provided, that, without limitation of the foregoing, no vote shall be
cast, and no consent shall be given or action taken by any Pledgor that
would authorize or effect (except if and to the extent expressly permitted
by the US Credit Agreement): (A) the dissolution or liquidation, in whole
or in part, of any issuer of the Pledged Collateral, (B) the consolidation
or merger of any issuer of the Pledged Collateral with any other Person
(other than any Pledgor), (C) the sale, disposition or encumbrance of any
portion of the assets of any issuer of the Pledged Collateral or any
business or division thereof, (D) any change in the authorized number of
shares, the stated capital or the authorized shares of any issuer of the
Pledged
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Collateral or the issuance of any additional shares of capital stock
thereof, or (E) the alteration of the voting rights with respect to the
capital stock of any issuer of the Pledged Collateral;
(ii) Each Pledgor shall be entitled, from time to time, to
collect and receive for its own use all dividends, distributions, interest
and other amounts paid in respect of its Pledged Collateral to the extent
not in violation of the Secured Debt Documents other than any and all: (A)
dividends and interest paid or payable other than in cash in respect of,
and instruments and other property received, receivable or otherwise
distributed in respect of, or in exchange for, any of its Pledged
Collateral, (B) dividends and other distributions paid or payable in cash
in respect of any of its Pledged Collateral in connection with a partial
or total liquidation or dissolution, and (C) cash paid, payable or
otherwise distributed in redemption of, or in exchange for, any of its
Pledged Collateral; provided, that until actually paid all rights to such
dividends shall remain subject to the Lien created by this Pledge
Agreement.
(b) All dividends (other than such cash dividends as are permitted
to be paid to the Pledgors in accordance with Section 8(a)(ii) above) and all
other distributions in respect of any of the Pledged Collateral, whenever paid
or made, shall be delivered to the Collateral Agent to hold as Pledged
Collateral and shall, if received by any Pledgor, be received in trust for the
benefit of the Collateral Agent, be segregated from the other property or funds
of such Pledgor, and be forthwith delivered promptly to the Collateral Agent as
Pledged Collateral of such Pledgor in the same form as so received (with any
necessary endorsement or assignment).
(c) Upon the occurrence of an Event of Default and during the
continuation thereof, all of Pledgors' rights to exercise voting and other
consensual rights pursuant to Section 8(a)(i) hereof and all of Pledgors' rights
to receive any cash dividends and distributions pursuant to Section 8(a)(ii)
hereof shall cease and all such rights shall thereupon become vested in the
Collateral Agent, for the benefit of the Secured Creditors, who shall have the
sole and exclusive right to exercise the voting and other consensual rights
which the Pledgors would otherwise be authorized to exercise pursuant to Section
8(a)(i) hereof and to receive and retain the dividends and distributions which
the Pledgors would otherwise be authorized to receive and retain pursuant to
Section 8(a)(ii) hereof. Upon the occurrence of an Event of Default and during
the continuation thereof, each Pledgor shall pay over to the Collateral Agent,
for the benefit of the Secured Creditors, any dividends received by such Pledgor
with respect to its Pledged Collateral and any and all money and other property
paid over to or received by the Collateral Agent shall be retained by the
Collateral Agent, for the benefit of the Secured Creditors, as Pledged
Collateral hereunder and shall be applied in accordance with the provisions
hereof.
9. Default. The Pledgors shall be in default under this Pledge Agreement
upon the happening of any of the following events or conditions (hereinafter
referred to as an "Event of Default"):
(i) The occurrence of a "Default" or an "Event of Default" as
defined in the US Credit Agreement;
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(ii) The occurrence of a "Default" or an "Event of Default" as
defined in the Canadian Credit Agreement;
(iii) The filing of any financing statement with regard to the
Pledged Collateral, other than relating to or permitted by this Pledge
Agreement, or the attachment of any additional lien or security interest to any
portion of the Pledged Collateral, for the benefit of any Person other than the
Collateral Agent; and
(iv) Failure of any Pledgor to observe any of its respective
covenants set forth in this Pledge Agreement.
10. Remedies Upon An Event Of Default.
(a) Upon the occurrence of an Event of Default and during the
continuation thereof, the Collateral Agent may exercise all rights of a secured
party under the UCC (whether or not the UCC applies to the affected collateral).
In addition, the Collateral Agent is hereby authorized and empowered to transfer
and register in its name or in the name of its nominee the whole or any part of
the Pledged Collateral, exercise the voting rights with respect thereto, collect
and receive all cash dividends and other distributions made thereon, sell in one
or more sales after ten (10) days' notice of the time and place of any public
sale or of the time after which a private sale is to take place (which notice
each Pledgor agrees is commercially reasonable), but without any previous notice
or advertisement, the whole or any part of the Pledged Collateral and otherwise
act with respect to the Pledged Collateral as though the Collateral Agent was
the legal and record owner thereof. Each Pledgor hereby irrevocably constitutes
and appoints the Collateral Agent, for the benefit of the Secured Creditors, as
the proxy and attorney-in-fact of such Pledgor with respect to the Pledged
Collateral, with full power of substitution to exercise any of the rights
provided in the preceding sentence; provided, that the Collateral Agent shall
not have any duty to exercise any such right or to preserve the same and shall
not be liable for any failure to do so or for any delay in doing so. Any sale
shall be made at a public or private sale at the Collateral Agent's offices or
elsewhere to be named in the notice of sale, either for cash or upon credit or
for future delivery at such price as the Collateral Agent may deem fair, and the
Collateral Agent or any Secured Party may be the purchaser of the whole or any
part of the Pledged Collateral so sold and hold the same thereafter in its own
right free from any claim of any Pledgor or any right of redemption, which each
Pledgor hereby waives to the extent permitted by applicable law. Each sale shall
be made to the highest bidder, but the Collateral Agent reserves the right to
reject any and all bids at such sale which, in its discretion, it shall deem
inadequate. Demands of performance, except as otherwise herein specifically
provided for, notices of sale, advertisements and the presence of property at
sale are hereby waived and any sale hereunder may be conducted by an auctioneer
or any officer or agent of the Collateral Agent.
(b) If, at the original time or times appointed for the sale of the
whole or any part of the Pledged Collateral, the highest bid, if there be but
one sale, shall be inadequate to discharge in full all the Secured Obligations,
or if the Pledged Collateral be offered for sale in lots, if at any of such
sales, the highest bid for the lot offered for sale would indicate to the
Collateral Agent, in its discretion, the unlikelihood of the proceeds of the
sales of the whole of
10
the Pledged Collateral being sufficient to discharge all the Secured
Obligations, the Collateral Agent may, on one or more occasions and in its
discretion, postpone any of said sales by public announcement at the time of
sale or the time of previous postponement of sale, and no other notice of such
postponement or postponements of sale need be given, any other notice being
hereby waived; provided, that any sale or sales made after such postponement
shall be after ten (10) days' notice from the Collateral Agent to any such
Pledgor.
(c) If, at any time that the Collateral Agent shall determine to
exercise its rights to sell the whole or any part of the Pledged Collateral
hereunder, such Pledged Collateral or the part thereof to be sold shall not, for
any reason whatsoever, be effectively registered under the Securities Act of
1933, as amended (the "Act"), the Collateral Agent may, in its discretion
(subject only to applicable requirements of law), sell such Pledged Collateral
or part thereof by private sale in such manner and under such circumstances as
the Collateral Agent may deem necessary or advisable, but subject to the other
requirements of this Section 9, and shall not be required to effect such
registration or to cause the same to be effected. Without limiting the
generality of the foregoing, in any such event the Collateral Agent in its
discretion (i) may, in accordance with applicable securities laws, proceed to
make such private sale notwithstanding that a registration statement for the
purpose of registering such Pledged Collateral or part thereof could be or shall
have been filed under said Act (or similar statute), (ii) may approach and
negotiate with a single possible purchaser to effect such sale, (iii) may
restrict such sale to a purchaser who will represent and agree that such
purchaser is purchasing for its own account, for investment and not with a view
to the distribution or sale of such Pledged Collateral or part thereof, and (iv)
may place all or any part of the Pledged Collateral with an investment banking
firm for private placement, which firm shall be entitled to purchase all or any
part of the Pledged Collateral for its own account. If any of the Pledged
Collateral shall not be freely distributable to the public without registration
under the Act (or similar statute), then the Collateral Agent shall not be
required to effect such registration or cause the same to be effected but, in
its discretion (subject to applicable requirements of law), may require that any
sale hereunder (including a sale at auction) be conducted subject to
restrictions (i) as to the financial sophistication and ability of any Person
permitted to bid or purchase at any such sale, (ii) as to the content of legends
to be placed upon any certificates representing the Pledged Collateral sold in
such sale, including restrictions on future transfer thereof, (iii) as to the
representations required to be made by each Person bidding or purchasing at such
sale relating to that Person's access to financial information about any Pledgor
or any of its subsidiaries so sold and such Person's intentions as to the
holding of the Pledged Collateral so sold for investment, for its own account,
and not with a view to the distribution thereof, and (iv) as to such other
matters as the Collateral Agent may, in its discretion, deem necessary or
appropriate in order that such sale (notwithstanding any failure so to register)
may be effected in compliance with the UCC and other laws affecting the
enforcement of creditors' rights and the Act and all applicable state securities
laws.
(d) Each Pledgor acknowledges that, notwithstanding the legal
availability of a private sale or a sale subject to the restrictions described
above in paragraph (c), the Collateral Agent may, in its discretion, elect to
register any or all the Pledged Collateral under the Act (or any applicable
state securities law). Each Pledgor, however, recognizes that the Collateral
Agent may be unable to effect a public sale of any or all the Pledged Collateral
and may be compelled to resort to one or more private sales thereof. Each
Pledgor also acknowledges that any such
11
private sale may result in prices and other terms less favorable to the seller
than if such sale were a public sale and, notwithstanding such circumstances,
agrees that any such private sale shall be deemed to have been made in a
commercially reasonable manner. The Collateral Agent shall be under no
obligation to delay a sale of any of the Pledged Collateral for the period of
time necessary to permit the registrant to register such securities for public
sale under the Act, or under applicable state securities laws, even if each
Pledgor would agree to do so.
(e) Any cash held by the Collateral Agent as Pledged Collateral and all
cash proceeds received by the Collateral Agent in respect of any sale of,
collection from, or other realization upon all or any part of the Pledged
Collateral may, in the discretion of the Collateral Agent, be held by the
Collateral Agent as collateral for, and/or then or at any time thereafter be
applied in whole or in part by the Collateral Agent for the benefit of the
Secured Creditors against, all or any part of the Secured Obligations in
accordance with the terms of the Intercreditor Agreement.
(f) Each Pledgor agrees that following the occurrence and during the
continuation of an Event of Default it will not at any time plead, 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 Pledge Agreement, or the absolute sale of the whole or any
part of the Pledged Collateral or the possession thereof by any purchaser at any
sale hereunder, and each Pledgor waives the benefit of all such laws to the
extent it lawfully may do so. Each Pledgor agrees that it will not interfere
with any right, power and remedy of the Collateral Agent provided for in this
Pledge Agreement or now or hereafter existing at law or in equity or by statute
or otherwise, or the exercise or beginning of the exercise by the Collateral
Agent of any one or more of such rights, powers, or remedies. No failure or
delay on the part of the Collateral Agent to exercise any such right, power or
remedy and no notice or demand which may be given to or made upon any Pledgor by
the Collateral Agent with respect to any such remedies shall operate as a waiver
thereof, or limit or impair the Collateral Agent's right to take any action or
to exercise any power or remedy hereunder, without notice or demand, or
prejudice its rights as against any Pledgor in any respect. Each Pledgor waives
all claims, damages and demands against the Collateral Agent arising out of the
repossession, retention or sale of the Pledged Collateral.
11. Power Of Attorney. Each Pledgor appoints the Collateral Agent, or any
other Person whom the Collateral Agent may designate, as each Pledgor's true and
lawful attorney-in-fact, with power to endorse each Pledgor's name on any
checks, notes, acceptances, money orders, drafts or other form of payment or
security representing a portion of the Pledged Collateral that may come into the
Collateral Agent's possession and to do all things necessary to carry out the
terms of this Pledge Agreement. Each Pledgor ratifies and approves all such acts
of such attorney-in-fact. Neither the Collateral Agent nor any other Person
designated by the Collateral Agent as attorney-in-fact hereunder will be liable
for any acts or omissions, nor for any errors of judgment or mistakes of fact or
law. This power, coupled with an interest, is irrevocable until the payment if
full of all Secured Obligations of each Pledgor.
12. Collateral Agent's Right To Take Action.
12
(a) In the event that any Pledgor fails or refuses promptly to perform
any of its obligations set forth herein, including, without limitation, its
obligation pursuant to Section 6(c) hereof to pay taxes, assessments and other
charges levied, assessed or imposed on the Pledged Collateral, or otherwise
fails or refuses to pay any amount necessary for the preservation and protection
of the Pledged Collateral, the Collateral Agent shall have the right, without
obligation, to do all things it deems necessary or advisable to discharge the
same (including, without limitation, to pay any such taxes, assessments, charges
or other sums, together with interest and penalties thereon) and any sums paid
by the Collateral Agent, or the cost thereof, including, without limitation,
attorneys' fees, shall be reimbursed by the Pledgors, to the Collateral Agent on
demand and, until so reimbursed, shall bear interest at the highest rate
chargeable under Section 2.15(c) of the Credit Agreement.
(b) By accepting the benefits of this Pledge Agreement the Secured
Creditors expressly acknowledge and agree that this Agreement may be enforced
only by the action of the Collateral Agent and that no other Secured Creditor
shall have any right individually to seek to enforce or to enforce this
Agreement or to realize upon the security to be granted hereby, it being
understood and agreed that such rights and remedies shall be exercised
exclusively by the Collateral Agent for the benefit of the Secured Creditors
upon the terms of this Agreement and the Intercreditor Agreement.
13. Indemnity; Expenses.
(a) Each Pledgor jointly and severally agrees to indemnify,
reimburse and hold the Collateral Agent, each other Secured Creditor, and their
respective successors, assigns, employees, officers, directors, affiliates,
agents and servants (hereinafter in this Section referred to individually as an
"Indemnitee," and, collectively, as "Indemnitees") harmless from any and all
liabilities, obligations, losses, damages, injuries, penalties, claims, demands,
actions, suits, judgments and any and all costs, expenses or disbursements
(including reasonable attorneys' fees and expenses) (for the purposes of this
Section the foregoing are collectively called "expenses") of whatsoever kind and
nature imposed on, asserted against or incurred by any of the Indemnitees in any
way relating to or arising out of this Agreement, any other Secured Debt
Documents or any other document executed in connection herewith or therewith or
in any other way connected with the administration of the transactions
contemplated hereby or thereby or the enforcement of any of the terms of, or the
preservation of any rights under any thereof, or in any way relating to or
arising out of the manufacture, ownership, ordering, purchase, delivery,
control, acceptance, lease, financing, possession, operation, condition, sale,
return or other disposition, or use of the Pledged Collateral (including,
without limitation, latent or other defects, whether or not discoverable),
including the violation by an Pledgor of the laws of any country, state or other
governmental body or unit, any tort (including, without limitation, claims
arising or imposed under the doctrine of strict liability, or for or on account
of injury to or the death of any Person (including any Indemnitee), or property
damage), or contract claim; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses (x) are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee or (y) result from a claim
brought by a Pledgor against an Indemnitee for material breach of such
Indemnitee's obligations hereunder, if such Pledgor has
13
obtained a final and nonappealable judgment in its favor on such claim as
determined by a court of competent jurisdiction. Each Pledgor agrees that upon
written notice by any Indemnitee of the assertion of such a liability,
obligation, loss, damage, injury, penalty, claim, demand, action, suit or
judgment, the relevant Pledgor shall assume full responsibility for the defense
thereof.
(b) Without limiting the application of subsection (a) above, each
Pledgor agrees, jointly and severally, to pay, or reimburse the Collateral Agent
for any and all reasonable fees, costs and expenses of whatever kind or nature
incurred in connection with the creation, preservation or protection of the
Collateral Agent's Liens on, and security interest in, the Pledged Collateral,
including, without limitation, all fees and taxes in connection with the
recording or filing of instruments and documents in public offices, payment or
discharge of any taxes or Liens upon or in respect of the Pledged Collateral,
including stamp, intangible or other taxes that may be payable or determined in
the future to be payable in connection with this Pledge Agreement or any other
document executed or delivered in connection herewith, and all other reasonable
fees, costs and expenses in connection with protecting, maintaining or
preserving the Pledged Collateral and the Collateral Agent's interest therein,
whether through judicial proceedings or otherwise, or in defending or
prosecuting any actions, suits or proceedings arising out of or relating to the
Pledged Collateral.
(c) Without limiting the application of subsections (a) or (b)
above, each Pledgor agrees, jointly and severally, to pay, indemnify and hold
each Indemnitee harmless from and against any loss, costs, damages and expenses
which such Indemnitee may suffer, expend or incur in consequence of or growing
out of any material misrepresentation by any Pledgor in this Agreement, any
other Secured Debt Document or in any writing contemplated by or made or
delivered pursuant to or in connection with this Agreement or any other Secured
Debt Document.
(d) If and to the extent that the obligations of any Pledgor under
this Section are unenforceable for any reason, such Pledgor hereby agrees to
make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law. This Section 13 shall
survive the termination of this Agreement.
14. Limitation On the Collateral Agent's Duty In Respect Of Pledged
Collateral. The Collateral Agent shall use reasonable care with respect to the
Pledged Collateral in its possession or under its control. The powers conferred
on the Collateral Agent hereunder are solely to protect its interest in the
Pledged Collateral and shall not impose any duty upon it to exercise any such
powers. Except for the safe custody of any Pledged Collateral in its possession
and the accounting for moneys actually received by it hereunder, the Collateral
Agent shall have no duty as to any Pledged Collateral or any income thereon, as
to ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any Pledged Collateral, whether
or not the Collateral Agent, or any other Secured Party has or is deemed to have
knowledge of such matters, or as to the taking of any necessary steps to
preserve rights against any parties or any other rights pertaining to any
Pledged Collateral. The Collateral Agent shall be deemed to have exercised
reasonable care in the custody and preservation of any Pledged Collateral in its
possession if such Pledged Collateral is accorded treatment substantially equal
to that which the Collateral Agent accords its own property.
14
15. Security Interest Absolute. All rights of the Collateral Agent and
security interests hereunder, and all obligations of each Pledgor hereunder,
shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of any Secured Debt
Document;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the obligations, or any other amendment or waiver
of or any consent to any departure from the Secured Debt Documents including,
without limitation, any increase in the Secured Obligations resulting from the
extension of additional credit to any Pledgor or any of its Subsidiaries or
otherwise;
(c) any taking, exchange, release or non-perfection of any other
collateral, or any taking, release or amendment or waiver of or consent to
departure from any guaranty, for all or any of the Secured Obligations;
(d) any manner of application of collateral, or proceeds thereof, to
all or any of the Secured Obligations, or any manner of sale or other
disposition of any collateral for all or any part of the Secured Obligations or
any other assets of any Pledgor or any of its Subsidiaries;
(e) any change, restructuring or termination of the corporate structure
or existence of any Pledgor or any of its Subsidiaries; or
(f) any other circumstance which might otherwise constitute a defense
available to, or a discharge of, any Pledgor or a third party pledgor.
16. Reinstatement. This Pledge Agreement shall remain in full force and
effect and continue to be effective should any petition be filed by or against
any Pledgor for liquidation or reorganization, should any Pledgor become
insolvent or make an assignment for the benefit of any creditor or creditors or
should a receiver or trustee be appointed for all or any significant part of any
Pledgor's assets, and shall continue to be effective or be reinstated, as the
case may be, if at any time payment and performance of the Secured Obligations,
or any part thereof, is, pursuant to applicable law, rescinded or reduced in
amount, or must otherwise be restored or returned by any obligee of the Secured
Obligations, whether as a "voidable preference," "fraudulent conveyance,"
"fraudulent transfer" or otherwise, all as though such payment or performance
had not been made. In the event that any payment, or any part thereof, is
rescinded, reduced, restored or returned, the Secured Obligations shall be
reinstated and deemed reduced only by such amount paid and not so rescinded,
reduced, restored or returned.
17. Successors And Assigns. This Pledge Agreement and all obligations of
each Pledgor hereunder shall be binding upon the successors and assigns of such
Pledgor (including any debtor-in-possession on behalf of such Pledgor) and
shall, together with the rights and remedies of the Collateral Agent, for the
benefit of the Secured Creditors, hereunder, inure to the benefit of the
Collateral Agent, Secured Creditors, all future holders of any instrument
evidencing any of the Secured Obligations and their respective successors and
assigns. No sales of participations, other sales, assignments, transfers or
other dispositions of any agreement
15
governing or instrument evidencing the Secured Obligations or any portion
thereof or interest therein shall in any manner affect the Lien granted to the
Collateral Agent, for the benefit of the Secured Creditors, hereunder. No
Pledgor may assign, sell, hypothecate or otherwise transfer any interest in or
obligation under this Pledge Agreement.
18. Waivers. No failure or delay by any Secured Party in exercising any
right shall operate as a waiver of such right. The Secured Creditors expressly
reserve the right to require strict compliance with the terms of this Pledge
Agreement. Any waiver or indulgence granted by any Secured Party shall not
constitute a modification of this Pledge Agreement, except to the extent
expressly provided in such waiver or indulgence, or constitute a course of
dealing by any Secured Party at variance with the terms of this Pledge Agreement
such as to require further notice by them of their intent to require strict
adherence to the terms of this Pledge Agreement in the future. Any such actions
shall not in any way affect the ability of the Secured Creditors, in their
discretion, to exercise any rights available to them under this Pledge
Agreement.
19. Remedies Cumulative. The rights and remedies of the Secured Creditors
under this Pledge Agreement shall be cumulative and nonexclusive of any other
rights and remedies which any Secured Party may have under any other agreement,
including the Secured Debt Documents, or by operation of law or otherwise.
Recourse to the Pledged Collateral shall not be required.
20. Severability. Any provision of this Pledge Agreement which is
prohibited or unenforceable shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof in that jurisdiction or affecting the validity or enforceability of such
provision in any other jurisdiction.
21. Notices. All notices, requests and other communications to the
Pledgors or Collateral Agent hereunder shall be delivered in the manner required
by the US Credit Agreement and shall be sufficiently given to Collateral Agent
or any Pledgor if addressed or delivered to them at, in the case of the
Collateral Agent at the address of the US Agent set forth in the US Credit
Agreement, in the case of the Borrower, its address and telecopier number
specified in the US Credit Agreement and in the case of any other Pledgors, at
their respective addresses and telecopier numbers provided in the Subsidiary
Guaranty Agreement. All such notices and communications shall be deemed to have
been duly given at the times set forth in the US Credit Agreement.
22. Limitation By Law. All rights, remedies and powers provided in this
Pledge Agreement may be exercised only to the extent that the exercise thereof
does not violate any applicable provision of law, and all the provisions of this
Pledge Agreement are intended to be subject to all applicable mandatory
provisions of law that may be controlling and to be limited to the extent
necessary so that they shall not render this Pledge Agreement invalid,
unenforceable, in whole or in part, or not entitled to be recorded, registered
or filed under the provisions of any applicable law.
23. Headings. Headings used in this Agreement are for convenience only and
shall not be used in connection with the interpretation of any provision hereof.
16
24. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute but one and the same instrument.
25. Governing Law; Waiver of Jury Trial.
(a) THIS PLEDGE AGREEMENT AND THE RIGHTS AND SECURED OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAW (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF) OF THE
STATE OF GEORGIA, EXCEPT TO THE EXTENT THAT PERFECTION (AND THE EFFECT OF
PERFECTION AND NONPERFECTION) AND CERTAIN REMEDIES MAY BE GOVERNED BY THE LAWS
OF ANY JURISDICTION OTHER THAN GEORGIA.
(b) PLEDGORS IRREVOCABLY AND UNCONDITIONALLY SUBMIT, FOR THEMSELF
AND THEIR PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THE UNITED STATES
DISTRICT COURT OF THE NORTHERN DISTRICT OF GEORGIA, AND ANY STATE COURT SITTING
IN XXXXXX COUNTY AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH
OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL
CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED
IN SUCH GEORGIA STATE COURT OR, TO THE EXTENT PERMITTED BY APPLICABLE LAW, SUCH
FEDERAL COURT. EACH PLEDGOR AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS
AGREEMENT SHALL AFFECT ANY RIGHT THAT THE COLLATERAL AGENT OR ANY SECURED
CREDITOR MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT OR ANY OTHER SECURED DEBT DOCUMENT AGAINST SUCH PLEDGOR OR ITS
PROPERTIES IN THE COURTS OF ANY JURISDICTION IN WHICH THE PROPERTY THAT IS THE
SUBJECT OF SUCH ACTION OR PROCEEDING IS LOCATED.
(c) EACH PLEDGOR IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH
SUIT, ACTION OR PROCEEDING DESCRIBED IN PARAGRAPH (b) OF THIS SECTION AND
BROUGHT IN ANY COURT REFERRED TO IN PARAGRAPH (b) OF THIS SECTION. EACH PLEDGOR
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE
DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT.
17
(d) EACH PLEDGOR IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS IN
THE MANNER PROVIDED FOR NOTICES IN THE CREDIT AGREEMENT. NOTHING IN THIS
AGREEMENT OR IN ANY OTHER SECURED DEBT DOCUMENT WILL AFFECT THE RIGHT OF ANY
PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
(e) EACH PLEDGOR HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF THIS PLEDGE AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY
OTHER THEORY). EACH PLEDGOR (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER, AND (B) ACKNOWLEDGES THAT IT HAS NOT BEEN INDUCED TO ENTER INTO THIS
PLEDGE AGREEMENT BY, AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS IN THIS
SECTION.
26. No Strict Construction. The parties hereto have participated jointly
in the negotiation and drafting of this Pledge Agreement. In the event an
ambiguity or question of intent or interpretation arises, this Pledge Agreement
shall be construed as if drafted jointly by the parties hereto and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Pledge Agreement.
27. Benefit of Secured Creditors. All Liens granted or contemplated hereby
shall be for the benefit of the Secured Creditors and all proceeds or payments
realized from Pledged Collateral in accordance herewith shall be applied to the
Secured Obligations in accordance with the terms of the Intercreditor Agreement.
28. Termination of this Pledge Agreement. No termination or cancellation
(regardless of cause or procedure) of either the US Credit Agreement or the
Canadian Credit Agreement shall in any way affect or impair the powers,
obligations, duties, rights and liabilities of the parties hereto in any way
with respect to (i) any transaction or event occurring prior to such termination
or cancellation, (ii) the Pledged Collateral, or (iii) any Pledgor's
undertakings, agreements, covenants, warranties and representations contained in
this Pledge Agreement and all such undertakings, agreements, covenants,
warranties and representations shall survive such termination or cancellation
until the payment and performance, in full, of all Secured Obligations of the
Pledgors. Subject to Section 13 hereof, this Pledge Agreement shall terminate
upon the payment and performance, in full in cash, of all Secured Obligations of
the Pledgors.
29. Additional Pledged Collateral. In the event that the any new Pledgor
is required, under the terms of any Secured Debt Document or otherwise, to
pledge and hypothecate any Pledged Collateral after the Closing Date, such
Pledgor shall pledge and hypothecate such Pledged Collateral, and be bound with
respect to such Pledged Collateral by all of the terms and
18
conditions hereof, by delivery to the Collateral Agent of an executed
counterpart of a Supplement to Pledge Agreement in the form of Exhibit A
attached hereto.
[Signature Page Follows]
19
IN WITNESS WHEREOF, each Pledgor has caused this Pledge Agreement to be
executed and delivered by its duly authorized officer as of the date first set
forth above.
EMS TECHNOLOGIES, INC.
By: ______________________________
Name:
Title:
EMS INVESTMENT HOLDINGS, INC.
By: ______________________________
Name:
Title:
LXE INC.
By: ______________________________
Name:
Title:
Acknowledged and Agreed to :
SUNTRUST BANK,
as Collateral Agent
By: ______________________
Name:
Title:
20
Schedule I to
Pledge Agreement
PART A
Percentage of
Shares
Name of Place of Issued and Par/No Shares Issued
Corporation Incorporation Outstanding Par and Outstanding
PART B
Percentage of
Shares
Name of Place of Issued and Par/No Shares Issued
Corporation Incorporation Outstanding Par and Outstanding
Schedule II
to
Pledge Agreement
EXHIBIT A
to
Pledge Agreement
SUPPLEMENT TO PLEDGE AGREEMENT
THIS SUPPLEMENT TO PLEDGE AGREEMENT (this "Supplement"), dated as of
_____________ __, 200_, is executed by [_________________], [__________] (the
"Pledgor"), in favor of SUNTRUST BANK, a Georgia banking corporation, as
Collateral Agent (the "Collateral Agent"), for the benefit of the Secured
Creditors (as defined below). Terms used herein but not defined herein shall
have the meaning defined for those terms in the Pledge Agreement (as defined
below).
WITNESSETH:
WHEREAS, EMS Technologies, Inc., EMS Investment Holdings, Inc. and LXE
Inc. (the "Existing Pledgors") are parties to that certain Pledge Agreement,
executed by the Existing Pledgors in favor the Collateral Agent, dated as of
December __, 2004 (as amended, restated, supplemented or otherwise modified from
time to time, the "Pledge Agreement"), pursuant to which the Pledgors pledged
stock and other collateral to the Collateral Agent, for the benefit of Secured
Creditors;
WHEREAS, it is a condition precedent to the obligations of the US Agent,
the Issuing Bank (as defined in the US Credit Agreement), the Swingline Lender
(as defined in the US Credit Agreement), and the US Lenders (collectively the
"US Creditors") under the US Credit Agreement that the Pledgor grant to the
Collateral Agent a security interest in all of its Additional Pledged Collateral
(as defined below) to secure all indebtedness and other obligations of the
Borrower under the US Credit Agreement, and to secure the indebtedness and other
obligations of each Subsidiary of the Borrower signatory hereto under the
Subsidiary Guaranty Agreement;
WHEREAS, it is a condition precedent to the obligations of the Canadian
Agent, the Issuing Bank (as defined in the Canadian Credit Agreement), the
Swingline Lender (as defined in the Canadian Credit Agreement), and the Canadian
Lenders (collectively, the "Canadian Creditors", and, together with the US
Creditors and the Swap Providers, the "Secured Creditors") under the Canadian
Credit Agreement that the Pledgor grant to the Collateral Agent a security
interest in all of its Additional Pledged Collateral to secure all indebtedness
and other obligations of the Borrower and each Subsidiary of the Borrower
signatory hereto under the Canadian Guaranty Agreement;
WHEREAS, it is a condition precedent to the Swap Providers entering into
the Hedging Transactions that the Pledgor enter into this Agreement to secure
the Hedging Obligations; and
A-1
WHEREAS, the Pledgor wishes to grant a security interest in its Additional
Pledged Collateral to satisfy the conditions precedent set forth above.
NOW, THEREFORE, in consideration of the premises and in order to ensure
the Pledgor's compliance with the Credit Agreement, the Pledgor hereby agrees as
follows:
SECTION 1. Additional Pledge. As security for the payment and performance
of the Secured Obligations, the Pledgor hereby (i) pledges and grants to the
Collateral Agent, for the benefit of the US Creditors, a first priority
continuing security interest in all of the Pledgor's right, title and interest
in, to and under the following property, whether now owned by or owing to, or
hereafter acquired by or arising in favor of the Pledgor, (ii) pledges and
grants to the Collateral Agent for the benefit of the Canadian Creditors, a
first priority continuing security interest in all of the Pledgor's right, title
and interest in, to and under the following property, whether now owned by or
owing to, or hereafter acquired by or arising in favor of the Pledgor and (iii)
pledges and grants to the Collateral Agent for the benefit of the Swap
Providers, a first priority continuing security interest in all of the Pledgor's
right, title and interest in, to and under the following property, whether now
owned by or owing to, or hereafter acquired by or arising in favor of the
Pledgor:
(a) The Equity Interests more particularly described on Schedule I
hereto and the certificates representing such Equity Interests (the
"Additional Pledged Shares"), and all dividends, cash, instruments and
other property or proceeds from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of the
Pledged Shares;
(b) The promissory notes more particularly described on Schedule II
hereto and the instruments representing such notes (the "Additional
Pledged Notes"); and
(c)all other Pledged Collateral (as defined in the Pledge Agreement)
(the items described in subsections (a), (b) and (c) above, collectively,
the "Additional Pledged Collateral"); and
SECTION 2. Certificates and Instruments. As security for the payment and
performance of the Secured Obligations, the Pledgor hereby delivers to the
Collateral Agent, for its benefit and the benefit of the Secured Creditors and
any other holder of any Secured Obligations, all of Pledgor's right, title and
interest in and to the certificates and instruments evidencing the Additional
Pledged Collateral, accompanied by instruments of transfer or assignment, duly
executed in blank.
SECTION 3. Representations and Warranties. Pledgor hereby (a) represents
and warrants that the Pledgor is the legal and beneficial owner of the
Additional Pledged Collateral, free and clear of any lien, security interest,
option or other charge or encumbrance except for the security interest created
by the Pledge Agreement as supplemented by this Supplement; and (b) restates
each representation and warranty set forth in Section 5 of the Pledge Agreement,
as supplemented by this Supplement, as of the date hereof with respect to the
Additional Pledged
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Collateral.
SECTION 4. Additional Pledged Collateral. By execution and delivery of
this Supplement, the Additional Pledged Collateral shall become a part of the
Pledged Collateral referred to in the Pledge Agreement and shall secure the
Secured Obligations as if such Additional Pledged Collateral were Pledged
Collateral on the date of the Pledge Agreement, and shall be subject to all of
the terms and conditions governing Pledged Collateral under the Pledge
Agreement. From and after the date hereof, Schedule I and Schedule II to the
Pledge Agreement are hereby amended to add the Additional Pledged Share and the
Additional Pledged Notes, respectively.
SECTION 5. Binding Effect. This Supplement shall become effective when it
shall have been executed by the Pledgor and thereafter shall be binding upon the
Pledgor and shall inure to the benefit of the Secured Creditors. Upon the
effectiveness of this Supplement, this Supplement shall be deemed to be a part
of and shall be subject to all the terms and conditions of the Pledge Agreement.
The Pledgor shall not have the right to assign its rights hereunder or any
interest herein without the prior written consent of the Secured Creditors.
SECTION 6. Governing Law; Terms. THIS SUPPLEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAW (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF) OF THE STATE OF GEORGIA.
SECTION 7. Execution in Counterparts. This Supplement may be executed in
any number of counterparts (including by telecopy), each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
IN WITNESS WHEREOF, the Pledgor has caused this Supplement to be duly
executed and delivered by its duly authorized officer as of the date first above
written.
"Pledgor"
By: ______________________________
Name:
Title:
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Schedule I
to
SUPPLEMENT TO PLEDGE AGREEMENT
Schedule II
to
SUPPLEMENT TO PLEDGE AGREEMENT
