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ADVANCED RADIO TELECOM CORP.
135,000 Units Consisting of
$135,000,000 Aggregate Principal Amount of
___% Senior Notes due 2007 and Warrants
to Purchase 2,731,725 Shares of Common Stock
COLLATERAL PLEDGE AND SECURITY AGREEMENT
Dated as of February ___, 0000
XXX XXXX XX XXX XXXX
Trustee
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THIS COLLATERAL PLEDGE AND SECURITY AGREEMENT (this "Pledge Agreement") is
made and entered into as of February ___, 1997 by Advanced Radio Telecom Corp.,
a Delaware corporation (the "Pledgor"), having its principal office at 000 000xx
Xxxxxx, X.X., Xxxxx 0000, Xxxxxxxx, Xxxxxxxxxx 00000, in favor of The Bank of
New York, a New York banking corporation, having an office at 000 Xxxxxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx 00000, as collateral agent (the "Collateral Agent")
for the holders (the "Holders") of the Senior Notes (as defined herein) of the
Pledgor.
WHEREAS, the Pledgor and The Bank of New York, as trustee, have entered
into that certain indenture dated as of February ___, 1997 (as amended,
restated, supplemented or otherwise modified from time to time, the
"Indenture"), pursuant to which the Pledgor is issuing on the date hereof up to
$135,000,000 in aggregate principal amount of ___% Senior Notes due 2007 (the
"Senior Notes") in connection with an offering (the "Offering") of 135,000
Units, each Unit consisting of $1,000 principal amount of Senior Notes and 15
Warrants, each Warrant representing the right to purchase 1.349 shares of Common
Stock of the Pledgor. Capitalized terms used herein and not otherwise defined
herein shall have the meanings given to such terms in the Indenture; and
WHEREAS, pursuant to the Indenture, the Pledgor agreed to: (i) purchase
Government Securities with a portion of the net proceeds from the Offering to be
deposited in the Pledge Account (as defined) (such Government Securities,
together with any substitute securities, the "Pledged Securities") in an amount
sufficient upon receipt of scheduled interest and principal payments thereon, in
the opinion of a nationally recognized firm of independent public accountants
selected by the Pledgor, to provide for payment in full of the first six
scheduled interest payments on the Senior Notes when and as due (the "Subject
Interest Payments") and (ii) place such Pledged Securities in an account
established in the name of the Collateral Agent for the deposit of the Pledged
Securities and held by the Collateral Agent for the benefit of Holders of the
Senior Notes (the "Pledge Account"); and
WHEREAS, the Pledgor is the legal and beneficial owner of the Pledged
Securities; and
WHEREAS, to secure its existing and future, absolute and contingent
obligations hereunder and under the Indenture and the Senior Notes (the
"Obligations"), the Pledgor has agreed to: (i) pledge to the Collateral Agent,
for its benefit and the ratable benefit of the Holders of Senior Notes, and
grant to the Collateral Agent, for its benefit and the ratable benefit of the
Holders of Senior Notes, a first priority perfected security interest in, the
Pledged Securities and the Pledge Account, and (ii) execute and deliver this
Pledge Agreement in order to secure the due and punctual payment and performance
by the Pledgor of the Obligations;
NOW, THEREFORE, in order to induce the Holders of Senior Notes to purchase
the Senior Notes, and for good and valuable consideration, the receipt of which
is hereby acknowledged, the Pledgor hereby agrees with the Collateral Agent, for
its benefit and for the ratable benefit of the Holders of Senior Notes, as
follows:
SECTION 1. PLEDGE AND GRANT OF SECURITY INTEREST. The Pledgor hereby
pledges to the Collateral Agent for its benefit and for the ratable benefit of
the Holders of Senior Notes, and grants to the Collateral Agent, for its benefit
and for the ratable benefit of the Holders of Senior Notes, a continuing first
priority perfected security interest in and to (a) all of Pledgor's now owned
and existing and hereafter arising or acquired right, title and interest in and
to the Pledged Securities and the Pledge Account, (b) the certificates or other
evidences of ownership representing any Pledged Securities or the Pledge Account
and (c) all proceeds of any of the Pledged Securities,
including, without limitation, all dividends, interest, principal payments,
cash, options, warrants, rights, instruments, investment property, subscriptions
and other property or proceeds from time to time received, receivable or
otherwise distributed or distributable in respect of or in exchange for any or
all of the Pledged Securities (collectively, for so long as held pursuant to the
Pledge Agreement, the "Collateral").
SECTION 2. SECURITY FOR OBLIGATIONS. This Pledge Agreement secures the
prompt and complete payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of all Obligations.
SECTION 3. DELIVERY OF COLLATERAL; PLEDGE ACCOUNT; INTEREST;
SUBSTITUTION OF COLLATERAL.
(a) All certificates or instruments representing or evidencing any of the
Collateral shall be delivered to and held by or on behalf of the Collateral
Agent pursuant hereto and shall be in suitable form for transfer by delivery, or
shall be accompanied by duly executed instruments of transfer or assignment in
blank, all in form and substance satisfactory to the Collateral Agent.
(b) Concurrently with the execution and delivery hereof, the Collateral
Agent shall establish the Pledge Account at its office at 000 Xxxxxxx Xxxxxx,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000. Subject to the other terms and
conditions of this Pledge Agreement, all funds or other property accepted by the
Collateral Agent pursuant to this Pledge Agreement shall be held in the Pledge
Account for the benefit of the Collateral Agent and the ratable benefit of the
Holders of Senior Notes.
(c) All interest earned on any Collateral shall be retained in the Pledge
Account (or reinvested, as the case may be), pending disbursement pursuant to
the terms hereof.
(d) At any time, the Pledgor may substitute Temporary Cash Investments of
the types described in clauses (i) through (v) in the definition thereof in the
Indenture for any or all of the Government Securities originally pledged as
Collateral ("Substitute Investments"); PROVIDED, HOWEVER, that (A) any
Substitute Investments must have scheduled principal and interest payments
which, together with the remaining scheduled interest and principal payments on
the remaining Collateral for which no substitution is made and proceeds of
Collateral in the form of cash and Temporary Cash Investments, in the opinion of
a nationally recognized firm of independent public accountants selected by the
Pledgor, will be sufficient to provide for payment in full of each of the
Subject Interest Payments when and as due, and (B) (other than Government
Securities so substituted) the aggregate scheduled principal and interest
payable on the Substitute Investments, in the opinion of a nationally recognized
firm of independent public accountants selected by the Pledgor, must be at least
equal to 125.0% of the amount of that portion of the Subject Interest Payments
to be funded by such Substitute Investments pursuant to (A) above. Concurrently
with such substitution, the Pledgor will deliver to the Collateral Agent a
certificate signed by the Chairman, President, Chief Financial Officer or
Treasurer of the Pledgor, (each, an "Executive Officer") certifying that (i) the
conditions for effecting such substitution have been satisfied and (ii) the
representations and warranties set forth in Sections 5(a) through (g) hereof are
true and correct with respect to the Substitute Investments.
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(e) Pending disbursement of funds from the Pledge Account as contemplated
hereby, (i) the Collateral Agent will, upon a written direction (such direction
to specify the particular investment) of the Pledgor, reinvest any interest
payments received in respect of the Pledged Securities in Temporary Cash
Investments, PROVIDED that any monies so reinvested and the securities acquired
thereby must be: (A) held as Collateral in the Pledge Account, (B) subject to
the security interest created hereby, and (C) otherwise subject to the terms
hereof, and (ii) the Collateral Agent will do all things necessary to obtain and
maintain a perfected security interest in the Collateral for the benefit of the
Collateral Agent and the ratable benefit of the Holders of Senior Notes.
SECTION 4. DISBURSEMENTS.
Unless the Pledgor notifies the Collateral Agent below that it intends to
take the action provided in Section 4(b), the Collateral Agent is authorized and
directed to transfer from the Pledge Account to the Payment Agent the following
amounts on the following dates and shall take any action necessary to make such
payments from the proceeds of the Pledged Securities:
Date Amount
---- ------
[One business day before [Amount of Subject Interest Payment]
Subject Interest Payment]
(b) If the Pledgor elects to make any Subject Interest Payment or portion
thereof from a source of funds other than the Collateral (such other funds,
"Pledgor Funds"), the Pledgor shall so notify the Collateral Agent at least five
(5) business days prior to the date of the Subject Interest Payment, and the
Pledgor may, after payment in full of such interest payment, request the
Collateral Agent in writing to release to the Pledgor an amount of funds from
the Pledge Account not in excess of the amount of Pledgor Funds so expended.
Upon receipt of a written request from the Pledgor and any other documentation
reasonably satisfactory to the Collateral Agent to substantiate such use of
Pledgor Funds by the Pledgor (including the certificate described in the
following sentence), the Collateral Agent is hereby authorized and directed, and
hereby agrees, to take any action necessary to enable it to pay over to the
Pledgor the requested amount. Concurrently with any release of funds to the
Pledgor pursuant to this subparagraph (b), the Pledgor will deliver to the
Collateral Agent a certificate signed by an Executive Officer certifying (i) the
amount of Pledgor Funds expended to make such Subject Interest Payment or
portion thereof, (ii) that such use of Pledgor Funds has been duly authorized by
all necessary corporate action, and does not contravene, or constitute a default
under, any provision of applicable law or regulation or of the certificate of
incorporation of the Pledgor or of any agreement, judgment, injunction, order,
decree or other instrument binding upon the Pledgor or result in the creation or
imposition of any Lien on any assets of the Pledgor, and (iii) no Default or
Event of Default exists and is continuing as of the date of such certificate.
(c) At any time the Pledgor may request the Collateral Agent in writing
to, and the Collateral Agent shall, return to the Pledgor any Collateral in
excess of the Collateral required such
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that the remaining principal and interest payments on the Collateral not
returned to the Pledgor ("Remaining Collateral"), together with any other
proceeds of Collateral in the form of cash and Temporary Cash Investments, in
the opinion of a nationally recognized firm of independent public accounts
selected by the Pledgor, are sufficient to provide for payment in full of the
Subject Interest Payments when and as due, PROVIDED that the aggregate remaining
scheduled principal and interest payable on any Remaining Collateral which were
Substitute Investments (other than the Government Securities), in the opinion of
a nationally recognized firm of independent public accountants selected by the
Pledgor, equals or exceeds 125.0% of the amount of that portion of the Subject
Interest Payments to be funded by such Substitute Investments in the foregoing
calculation. The Pledgor shall provide the Collateral Agent with a certificate
of an Executive Officer specifying the Collateral to be released and certifying
satisfaction with the foregoing condition.
(d) If the Pledgor proposes to effect a Legal Defeasance or a Covenant
Defeasance, upon notice from the Pledgor, the Collateral Agent shall deposit the
Collateral with the Trustee on behalf of the Pledgor pursuant to Section 8.04 of
the Indenture. Such notice shall be accompanied by a certificate of an
Executive Officer of the Pledgor certifying that the Pledgor is effecting a
Legal Defeasance or a Covenant Defeasance and that upon deposit of the
Collateral with the Trustee shall have satisfied all conditions thereto provided
in Section 8.04 of the Indenture.
(e) Upon payment in full of the Subject Interest Payments, PROVIDED that
the Obligations have not previously been declared to be due and payable pursuant
to the Indenture, the security interest in the Collateral evidenced by this
Pledge Agreement will terminate and be of no further force and effect.
Furthermore, upon the release of any Collateral from the Pledge Account in
accordance with the terms of this Pledge Agreement, whether upon release of
Collateral to the Paying Agent in full or partial payment of any Subject
Interest Payment, to the Pledgor, to the Trustee pursuant to Section 4(d) hereof
or otherwise, the security interest evidenced by this Pledge Agreement in the
Collateral so released will terminate and be of no further force and effect.
SECTION 5. REPRESENTATIONS AND WARRANTIES. The Pledgor hereby
represents and warrants that:
(a) The execution, delivery and performance by the Pledgor of this Pledge
Agreement are within the Pledgor's corporate powers, have been duly authorized
by all necessary corporate action, and do not contravene, or constitute a
default under, any provision of applicable law or regulation or of the
certificate of incorporation of the Pledgor or of any agreement, judgment,
injunction, order, decree or other instrument binding upon the Pledgor or result
in the creation or imposition of any Lien on any assets of the Pledgor, except
for the security interests granted under this Pledge Agreement.
(b) The Pledgor is the beneficial owner of the Pledged Securities, and
will be the beneficial owner of any Substitute Investments, free and clear of
any Lien or claims of any person or entity (except for the security interests
granted under this Pledge Agreement). No financing statement covering the
Pledged Securities is on file in any public office other than the financing
statements filed pursuant to this Pledge Agreement.
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(c) This Pledge Agreement has been duly executed and delivered by the
Pledgor and constitutes a valid and binding obligation of the Pledgor,
enforceable against the Pledgor in accordance with its terms, except as such
enforceability may be limited by the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally or general principles of equity and commercial
reasonableness.
(d) Upon (i) the delivery to the Collateral Agent of any certificates
representing the Pledged Securities, (ii) the crediting any uncertificated
Pledged Securities to the Pledge Account and (iii) the filing of any financing
statements that may be required by or desirable under the Uniform Commercial
Code (the "UCC") with respect to any of the Collateral, the pledge of the
Collateral pursuant to this Pledge Agreement will create a valid and first
priority perfected security interest in and to the Collateral, securing the
payment of the Obligations for the benefit of the Collateral Agent and the
ratable benefit of the Holders of Senior Notes.
(e) No consent of any other Person and no consent, authorization,
approval, or other action by, and no notice to or filing with, any governmental
authority or regulatory body is required for either (i) the pledge by the
Pledgor of the Collateral pursuant to this Pledge Agreement or for the
execution, delivery or performance of this Pledge Agreement by the Pledgor
(except for any filings necessary to perfect Liens on the Collateral) or (ii)
the exercise by the Collateral Agent of the rights provided for in this Pledge
Agreement or the remedies in respect of the Collateral pursuant to this Pledge
Agreement.
(f) No litigation, proceeding, or, to the knowledge of the Pledgor,
investigation of or before any arbitrator or governmental authority is pending
or, to the knowledge of the Pledgor, threatened by or against the Pledgor with
respect to this Pledge Agreement or any of the transactions contemplated hereby,
except as disclosed in the Offering Memorandum.
(g) The pledge of the Collateral pursuant to this Pledge Agreement is not
prohibited by any applicable law or governmental regulation, release,
interpretation or opinion of the Board of Governors of the Federal Reserve
System or other regulatory agency (including, without limitation, Regulations G,
T, U and X of the Board of Governors of the Federal Reserve System).
SECTION 6. FURTHER ASSURANCE. The Pledgor will, promptly upon request
of the Collateral Agent, execute and deliver or cause to be executed and
delivered, or use its best efforts to procure, all stock or bond powers,
proxies, assignments, instruments and other documents, all in form and substance
satisfactory to the Collateral Agent, deliver any instruments to the Collateral
Agent and take any other actions that are necessary or, in the reasonable
opinion of the Collateral Agent, desirable to perfect, continue the perfection
of, or protect the first priority of the Collateral Agent's security interest in
and to the Collateral, to protect the Collateral against the rights, claims, or
interests of third persons or to effect the purposes of this Pledge Agreement.
The Pledgor also hereby authorizes the Collateral Agent to file any financing or
continuation statements with respect to the Collateral without the signature of
the Pledgor (to the extent permitted by applicable law). The Pledgor will pay
all costs incurred by it in connection with any of the foregoing.
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SECTION 7. COVENANTS. The Pledgor covenants and agrees with the
Collateral Agent and the Holders of Senior Notes from and after the date of this
Pledge Agreement until the earlier of payment in full in cash of (A) each of the
Subject Interest Payments or (B) all obligations due and owing hereunder, under
the Indenture and under the Senior Notes in the event such obligations become
due and payable prior to the payment of the Subject Interest Payments:
(a) The Pledgor will not (i) sell or otherwise dispose of, or grant any
option or warrant with respect to, any of the Collateral or (ii) create or
permit to exist any Lien upon or with respect to any of the Collateral (except
for the lien created pursuant to this Pledge Agreement) and at all times will be
the sole beneficial owner of the Collateral.
(b) The Pledgor will not (i) enter into any agreement or understanding
that purports to or may restrict or inhibit the Collateral Agent's rights or
remedies hereunder, including, without limitation, the Collateral Agent's right
to sell or otherwise dispose of the Collateral or (ii) fail to pay or discharge
any tax, assessment or levy of any nature not later than five days prior to the
date of any proposed sale under any judgement, writ or warrant of attachment
with regard to the Collateral.
SECTION 8. POWER OF ATTORNEY. In addition to all of the powers granted
to the Collateral Agent pursuant to Article 6 of the Indenture, the Pledgor
hereby appoints and constitutes the Collateral Agent as the Pledgor's
attorney-in-fact to exercise to the fullest extent permitted by law all of the
following powers upon and at any time after the occurrence and during the
continuance of an Event of Default: (a) collection of proceeds of any
Collateral; (b) conveyance of any item of Collateral to any purchaser thereof;
(c) giving of any notices or recording of any Liens under Section 6 hereof;
(d) making of any payments or taking any acts under Section 9 hereof and
(e) paying or discharging taxes or Liens levied or placed upon the Collateral,
the legality or validity thereof and the amounts necessary to discharge the same
to be determined by the Collateral Agent in its sole discretion, and such
payments made by the Collateral Agent to become the Obligations of the Pledgor
to the Collateral Agent, due and payable immediately upon demand. The
Collateral Agent's authority hereunder shall include, without limitation, the
authority to endorse and negotiate any checks or instruments representing
proceeds of Collateral in the name of the Pledgor, execute and give receipt for
any certificate of ownership or any document constituting Collateral, transfer
title to any item of Collateral, sign the Pledgor's name on all financing
statements (to the extent permitted by applicable law) or any other documents
deemed necessary or appropriate by the Collateral Agent to preserve, protect or
perfect the security interest in the Collateral and to file the same, prepare,
file and sign the Pledgor's name on any notice of Lien, and to take any other
actions arising from or incident to the powers granted to the Collateral Agent
in this Pledge Agreement. This power of attorney is coupled with an interest
and is irrevocable by the Pledgor.
SECTION 9. COLLATERAL AGENT MAY PERFORM. If the Pledgor fails to
perform any agreement contained herein in accordance with the terms hereof, the
Collateral Agent may itself perform, or cause performance of, such agreement,
and the expenses of the Collateral Agent (including those of its agents and
counsel) incurred in connection therewith shall be payable by the Pledgor under
Section 13 hereof.
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SECTION 10. NO ASSUMPTION OF DUTIES; REASONABLE CARE. The rights and
powers granted to the Collateral Agent hereunder are being granted in order to
preserve and protect the Collateral Agent's and the Holders' of Senior Notes
security interest in and to the Collateral granted hereby and shall not be
interpreted to, and shall not, impose any duties on the Collateral Agent in
connection therewith other than those imposed under applicable law. Except as
provided by applicable law, the Collateral Agent shall be deemed to have
exercised reasonable care in the custody and preservation of the Collateral in
its possession if the Collateral is accorded treatment substantially equal to
that which the Collateral Agent accords similar property in similar situations,
it being understood that the Collateral Agent shall not have any responsibility
for (a) ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Collateral,
whether or not the Collateral Agent has or is deemed to have knowledge of such
matters or (b) taking any necessary steps to preserve rights against any parties
with respect to any Collateral. To the extent applicable, the Collateral Agent
acting pursuant to this Pledge Agreement shall be held to the same standards as
those set forth in the Indenture with respect to the Trustee acting as trustee
thereunder.
SECTION 11. INDEMNITY. The Pledgor shall indemnify, hold harmless and
defend the Collateral Agent and its directors, officers, agents and employees,
from and against any and all claims, actions, obligations and liabilities,
including defense costs, investigative fees and costs, legal fees, and claims
for damages, arising from the Collateral Agent's performance under this Pledge
Agreement, except to the extent that such claim, action, obligation or liability
is directly attributable to the bad faith, gross negligence or willful
misconduct of such indemnified person. IT IS THE INTENT OF THE PLEDGOR TO
INDEMNIFY AND HOLD HARMLESS THE COLLATERAL AGENT FOR CLAIMS, ACTIONS,
OBLIGATIONS OR LIABILITIES ARISING FROM THE COLLATERAL AGENT'S PERFORMANCE UNDER
THIS PLEDGE AGREEMENT INCLUDING ITS OWN NEGLIGENCE.
SECTION 12. REMEDIES UPON EVENT OF DEFAULT.
If an Event of Default under the Indenture shall have occurred and be
continuing:
(a) The Collateral Agent and the Holders of Senior Notes shall have, in
addition to all other rights given by law or by this Pledge Agreement or the
Indenture, all of the rights and remedies with respect to the Collateral of a
secured party under the UCC in effect in the State of New York at that time. In
addition, with respect to any Collateral that shall then be in or shall
thereafter come into the possession or custody of the Collateral Agent, the
Collateral Agent may sell or cause the same to be sold at a public or private
sale, in one or more sales or lots, at such price or prices as the Collateral
Agent may deem best, for cash or on credit or for future delivery, without
assumption of any credit risk. The purchaser of any or all Collateral so sold
shall thereafter hold the same absolutely, free from any claim, encumbrance or
right of any kind whatsoever created by or through the Pledgor. Unless any of
the Collateral threatens, in the reasonable judgment of the Collateral Agent, to
decline speedily in value or is or becomes of a type sold on a recognized
market, the Collateral 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 Collateral
conducted in conformity with
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reasonable commercial practices of banks, insurance companies, commercial
finance companies, or other financial institutions disposing of property similar
to the Collateral shall be deemed to be commercially reasonable. Any
requirements of reasonable notice shall be met if such notice is mailed to the
Pledgor as provided in Section 15(a) herein, at least fifteen (15) days before
the time of the sale or disposition. The Collateral Agent or any Holder of
Senior Notes may, in its own name or in the name of a designee or nominee, buy
any of the Collateral at any public sale and, if permitted by applicable law, at
any private sale. All expenses (including court costs and reasonable attorneys'
fees, expenses and disbursements) of, or incident to, the enforcement of any of
the provisions hereof shall be recoverable from the proceeds of the sale or
other disposition of the Collateral.
(b) The Pledgor further agrees to use its best efforts to do or cause to
be done all such other acts as may be necessary to make such sale or sales of
all or any portion of the Collateral pursuant to this Section 12 valid and
binding and in compliance with any and all other applicable requirements of law.
The Pledgor further agrees that a breach of any of the covenants contained in
this Section 12 will cause irreparable injury to the Collateral Agent and the
Holders of Senior Notes, that the Collateral Agent and the Holders of Senior
Notes have no adequate remedy at law in respect of such breach and, as a
consequence, that each and every covenant contained in this Section 12 shall be
specifically enforceable against the Pledgor, and the Pledgor hereby waives and
agrees not to assert any defenses against an action for specific performance of
such covenants except for a defense that no Event of Default has occurred.
SECTION 13. EXPENSES. The Pledgor will upon demand pay to the
Collateral Agent at the agreed upon times the agreed upon fees for its services
provided hereunder and the amount of any and all reasonable expenses, including,
without limitation, the reasonable fees, expenses and disbursements of its
counsel, experts and agents retained by the Collateral Agent that the Collateral
Agent may incur in connection with (a) the acceptance or administration of this
Pledge Agreement, (b) the custody or preservation of, or the sale of, collection
from, or other realization upon, any of the Collateral, (c) the exercise or
enforcement of any of the rights of the Collateral Agent and the Holders of
Senior Notes hereunder, or (d) the failure by the Pledgor to perform or observe
any of the provisions hereof.
SECTION 14. SECURITY INTEREST ABSOLUTE. All rights of the Collateral
Agent and the Holders of Senior Notes and security interests hereunder, and all
obligations of the Pledgor hereunder, shall be absolute and unconditional
irrespective of:
(a) any lack of validity or enforceability of the Indenture or any other
agreement or instrument relating thereto;
(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 Indenture;
(c) any exchange, surrender, release or non-perfection of any Liens on any
other collateral for all or any of the Obligations; or
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(d) to the extent permitted by applicable law, any other circumstance
which might otherwise constitute a defense available to, or a discharge of, the
Pledgor in respect of the Obligations or of this Pledge Agreement.
SECTION 15. MISCELLANEOUS PROVISIONS.
(a) NOTICES. Any notice, approval, consent or other communication by the
Pledgor or the Collateral Agent to the other, required or desired to be given
hereunder, is duly given if in writing and delivered in person or mailed by
first class mail (registered or certified, return receipt requested), telecopier
or overnight air courier guaranteeing next day delivery, to the other's address:
If to the Pledgor:
Advanced Radio Telecom Corp.
000 000xx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxxx, Xxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Chief Financial Officer
If to the Collateral Agent:
The Bank of New York
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Trustee Administration
The Pledgor or the Collateral Agent, by notice to the other may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders of Senior
Notes) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt acknowledged, if telecopied; and the
next Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.
Any notice or communication to a Holder of a Senior Note shall be mailed by
first class mail or by overnight air courier guaranteeing next day delivery to
its address shown on the register kept by the Registrar.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
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If the Pledgor mails a notice or communication to Holders of Senior Notes,
it shall mail a copy to the Collateral Agent and each Agent at the same time.
(b) NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS. This Pledge Agreement
may not be used to interpret another pledge, security or debt agreement (other
than the Indenture) of the Pledgor or any subsidiary thereof and no such pledge,
security or debt agreement (other than the Indenture) may be used to interpret
this Pledge Agreement.
(c) SEVERABILITY. The provisions of this Pledge Agreement are severable,
and if any clause or provision shall be held invalid, illegal or unenforceable
in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect in that jurisdiction only such clause or
provision, or part thereof, and shall not in any manner affect such clause or
provision in any other jurisdiction or any other clause or provision of this
Pledge Agreement in any jurisdiction.
(d) HEADINGS. The headings in this Pledge Agreement have been inserted
for convenience of reference only, are not to be considered a part hereof and
shall in no way modify or restrict any of the terms or provisions hereof.
(e) COUNTERPART ORIGINALS. This Pledge Agreement may be signed in two or
more counterparts, each of which shall be deemed an original, but all of which
shall together constitute one and the same agreement.
(f) BENEFITS OF PLEDGE AGREEMENT. Nothing in this Pledge Agreement,
express or implied, shall give to any person, other than the parties hereto and
their successors hereunder, and the Holders of Senior Notes, any benefit or any
legal or equitable right, remedy or claim under this Pledge Agreement.
(f) AMENDMENTS, WAIVERS AND CONSENTS. Any amendment or waiver of any
provision of this Pledge Agreement and any consent to any departure by the
Pledgor from any provision of this Pledge Agreement shall be effective only if
made or duly given in compliance with all of the terms and provisions of the
Indenture, and neither the Collateral Agent nor any Holder of Senior Notes shall
be deemed, by any act, delay, indulgence, omission or otherwise, to have waived
any right or remedy hereunder or to have acquiesced in any Default or Event of
Default or in any breach of any of the terms and conditions hereof. Failure of
the Collateral Agent or any Holder of Senior Notes to exercise, or delay in
exercising, any right, power or privilege hereunder shall not operate as a
waiver thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Collateral Agent or any
Holder of Senior Notes of any right or remedy hereunder on any one occasion
shall not be construed as a bar to any right or remedy that the Collateral Agent
or such Holder of Senior Notes would otherwise have on any future occasion. The
rights and remedies herein provided are cumulative, may be exercised singly or
concurrently and are not exclusive of any rights or remedies provided by law.
(h) INTERPRETATION OF AGREEMENT. All terms not defined herein or in the
Indenture shall have the meaning set forth in the applicable Uniform Commercial
Code, except where the context
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otherwise requires. To the extent a term or provision of this Pledge Agreement
conflicts with the Indenture, the Indenture shall control with respect to the
subject matter of such term or provision. Acceptance of or acquiescence in a
course of performance rendered under this Pledge Agreement shall not be relevant
to determine the meaning of this Pledge Agreement even though the accepting or
acquiescing party had knowledge of the nature of the performance and opportunity
for objection.
(i) CONTINUING SECURITY INTEREST; TERMINATION.
(1) This Pledge Agreement shall create a continuing security interest
in and to the Collateral and shall, unless otherwise provided in the
Indenture or in this Pledge Agreement, remain in full force and effect
until the earlier of payment in full in cash of (A) each of the Subject
Interest Payments or (B) all obligations due and owing under the Indenture
and the Senior Notes in the event such obligations become payable prior to
the payment of the Subject Interest Payments. This Pledge Agreement shall
be binding upon the Pledgor, its successors and assigns, and shall inure,
together with the rights and remedies of the Collateral Agent hereunder, to
the benefit of the Collateral Agent, the Holders of Senior Notes and their
respective successors, transferees and assigns.
(2) Subject to the provisions of Section 15(j) hereof, this Pledge
Agreement shall terminate upon the earlier of payment in full in cash of
(A) each of the Subject Interest Payments or (B) all obligations due and
owing under the Indenture and the Senior Notes in the event such
obligations become payable prior to the payment of the Subject Interest
Payments. At such time, the Collateral Agent shall, at the written request
of the Pledgor, reassign and redeliver to the Pledgor all of the Collateral
hereunder that has not been sold, disposed of, retained or applied by the
Collateral Agent in accordance with the terms of this Pledge Agreement and
the Indenture. Such reassignment and redelivery shall be without warranty
(either express or implied) by or recourse to the Collateral Agent, except
as to the absence of any prior assignments by the Collateral Agent of its
interest in the Collateral, and shall be at the expense of the Pledgor.
(j) SURVIVAL OF PROVISIONS. All representations, warranties and covenants
of the Pledgor contained herein shall survive the execution and delivery of this
Pledge Agreement, and shall terminate only upon the termination of this Pledge
Agreement; PROVIDED, HOWEVER, that the provisions of Sections 11 and 13 shall
survive the termination of this Pledge Agreement.
(k) WAIVERS. The Pledgor waives presentment and demand for payment of any
of the Obligations, protest and notice of dishonor or default with respect to
any of the Obligations, and all other notices to which the Pledgor might
otherwise be entitled, except as otherwise expressly provided herein or in the
Indenture.
(l) AUTHORITY OF THE COLLATERAL AGENT.
(1) The Collateral Agent shall have and be entitled to exercise all
powers hereunder that are specifically granted to the Collateral Agent by
the terms hereof, together with such powers as are reasonably incident
thereto. The Collateral Agent may perform
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any of its duties hereunder or in connection with the Collateral by or
through agents or employees and shall be entitled to retain counsel of its
selection and to act in reliance upon the advice of counsel concerning all
such matters. Neither the Collateral Agent, any director, officer,
employee, attorney or agent of the Collateral Agent nor the Holders of
Senior Notes shall be liable to the Pledgor for any action taken or omitted
to be taken by it or them hereunder, except for its or their own bad faith,
gross negligence or willful misconduct, nor shall the Collateral Agent be
responsible for the validity, effectiveness or sufficiency hereof or of any
document or security furnished pursuant hereto. The Collateral Agent and
its directors, officers, employees, attorneys and agents shall be entitled
to rely on any communication, instrument or document reasonably believed by
it or them to be genuine and correct and to have been signed or sent by the
proper person or persons.
(2) The Pledgor acknowledges that the rights and responsibilities of
the Collateral Agent under this Pledge Agreement with respect to any action
taken by the Collateral Agent or the exercise or non-exercise by the
Collateral Agent of any option, right, request, judgment or other right or
remedy provided for herein or resulting or arising out of this Pledge
Agreement shall, as between the Collateral Agent and the Holders of Senior
Notes, be governed by the Indenture and by such other agreements with
respect thereto as may exist from time to time among them, but, as between
the Collateral Agent and the Pledgor, the Collateral Agent shall be
conclusively presumed to be acting as agent for the Holders of Senior Notes
with full and valid authority so to act or refrain from acting, and the
Pledgor shall not be obligated or entitled to make any inquiry respecting
such authority.
(m) LIMITATION BY LAW. All rights, remedies and powers provided herein
may be exercised only to the extent that they will not render this Pledge
Agreement not entitled to be recorded, registered or filed under provisions of
any applicable law.
(n) FINAL EXPRESSION. This Pledge Agreement, together with any other
agreement executed in connection herewith, is intended by the parties as a final
expression of this Pledge Agreement and is intended as a complete and exclusive
statement of the terms and conditions thereof.
(o) RIGHTS OF HOLDERS OF SENIOR NOTES. No Holder of Senior Notes shall
have any independent rights hereunder other than those rights granted to
individual Holders of Senior Notes pursuant to Section 6.07 of the Indenture;
PROVIDED that nothing in this subsection shall limit any rights granted to the
Collateral Agent under the Senior Notes or the Indenture.
(p) GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL;
WAIVER OF DAMAGES.
(1) THIS PLEDGE AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED UNDER
THE LAWS OF THE STATE OF NEW YORK, AND ANY DISPUTE ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL
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TO THE RELATIONSHIP ESTABLISHED BETWEEN THE PLEDGOR, THE COLLATERAL AGENT
AND THE HOLDERS OF SENIOR NOTES IN CONNECTION WITH THIS PLEDGE AGREEMENT,
AND WHETHER ARISING IN CONTRACT, TORT, EQUITY OR OTHERWISE, SHALL BE
RESOLVED IN ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO THE CONFLICTS
OF LAWS PROVISIONS) OF THE STATE OF NEW YORK.
(2) THE PLEDGOR AGREES THAT THE COLLATERAL AGENT SHALL, IN ITS
CAPACITY AS COLLATERAL AGENT OR IN THE NAME AND ON BEHALF OF ANY HOLDER OF
SENIOR NOTES, HAVE THE RIGHT, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TO
PROCEED AGAINST THE PLEDGOR OR ITS PROPERTY IN A COURT IN ANY LOCATION
REASONABLY SELECTED IN GOOD FAITH (AND HAVING PERSONAL OR IN REM
JURISDICTION OVER THE PLEDGOR OR ITS PROPERTY, AS THE CASE MAY BE) TO
ENABLE THE COLLATERAL AGENT TO REALIZE ON SUCH PROPERTY, OR TO ENFORCE A
JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF THE COLLATERAL AGENT.
THE PLEDGOR AGREES THAT IT WILL NOT ASSERT ANY COUNTERCLAIMS, SETOFFS OR
CROSS CLAIMS IN ANY PROCEEDING BROUGHT BY THE COLLATERAL AGENT TO REALIZE
ON SUCH PROPERTY OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF
THE COLLATERAL AGENT, EXCEPT FOR SUCH COUNTERCLAIMS, SETOFFS OR CROSS
CLAIMS WHICH, IF NOT ASSERTED IN ANY SUCH PROCEEDING, COULD NOT OTHERWISE
BE BROUGHT OR ASSERTED. THE PLEDGOR WAIVES ANY OBJECTION THAT IT MAY HAVE
TO THE LOCATION OF THE COURT IN WHICH THE COLLATERAL AGENT HAS COMMENCED A
PROCEEDING DESCRIBED IN THIS PARAGRAPH INCLUDING, WITHOUT LIMITATION, ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS.
(3) THE PLEDGOR AND THE COLLATERAL AGENT EACH WAIVE ANY RIGHT TO HAVE
A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT,
TORT, OR OTHERWISE ARISING OUT OF, CONNECTED WITH, RELATED TO OR INCIDENTAL
TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS PLEDGE
AGREEMENT. INSTEAD, ANY DISPUTES RESOLVED IN COURT WILL BE RESOLVED IN A
BENCH TRIAL WITHOUT A JURY.
(4) THE PLEDGOR AGREES THAT NEITHER THE COLLATERAL AGENT NOR ANY
HOLDER OF SENIOR NOTES SHALL HAVE ANY LIABILITY TO THE PLEDGOR (WHETHER
SOUNDING IN TORT, CONTRACT OR OTHERWISE) FOR LOSSES SUFFERED BY THE PLEDGOR
IN CONNECTION WITH, ARISING OUT OF, OR IN ANY WAY RELATED TO, THE
TRANSACTIONS CONTEMPLATED AND THE RELATIONSHIP ESTABLISHED BY THIS PLEDGE
AGREEMENT, OR ANY ACT, OMISSION OR EVENT OCCURRING IN CONNECTION THEREWITH,
UNLESS IT IS DETERMINED BY A FINAL AND
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NONAPPEALABLE JUDGMENT OF A COURT THAT IS BINDING ON THE COLLATERAL AGENT
OR SUCH HOLDER OF SENIOR NOTES, AS THE CASE MAY BE, THAT SUCH LOSSES WERE
THE RESULT OF ACTS OR OMISSIONS ON THE PART OF THE COLLATERAL AGENT OR SUCH
HOLDER OF SENIOR NOTES, AS THE CASE MAY BE, CONSTITUTING BAD FAITH, GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT.
(5) TO THE EXTENT PERMITTED BY APPLICABLE LAW, AND EXCEPT AS
OTHERWISE PROVIDED IN THIS PLEDGE AGREEMENT, THE PLEDGOR WAIVES ALL RIGHTS
OF NOTICE AND HEARING OF ANY KIND PRIOR TO THE EXERCISE BY THE COLLATERAL
AGENT OR ANY HOLDER OF SENIOR NOTES OF ITS RIGHTS DURING THE CONTINUANCE OF
AN EVENT OF DEFAULT TO REPOSSESS THE COLLATERAL WITH JUDICIAL PROCESS OR TO
REPLEVY, ATTACH OR LEVY UPON THE COLLATERAL OR OTHER SECURITY FOR THE
OBLIGATIONS. TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PLEDGOR WAIVES
THE POSTING OF ANY BOND OTHERWISE REQUIRED OF THE COLLATERAL AGENT OR ANY
HOLDER OF SENIOR NOTES IN CONNECTION WITH ANY JUDICIAL PROCESS OR
PROCEEDING TO OBTAIN POSSESSION OF, REPLEVY, ATTACH OR LEVY UPON THE
COLLATERAL OR OTHER SECURITY FOR THE OBLIGATIONS, TO ENFORCE ANY JUDGMENT
OR OTHER COURT ORDER ENTERED IN FAVOR OF THE COLLATERAL AGENT OR ANY HOLDER
OF SENIOR NOTES, OR TO ENFORCE BY SPECIFIC PERFORMANCE, TEMPORARY
RESTRAINING ORDER OR PRELIMINARY OR PERMANENT INJUNCTION, THIS PLEDGE
AGREEMENT OR ANY OTHER AGREEMENT OR DOCUMENT BETWEEN THE PLEDGOR ON THE ONE
HAND AND THE COLLATERAL AGENT AND/OR THE HOLDERS OF SENIOR NOTES ON THE
OTHER HAND.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Pledgor and the Collateral Agent have each caused
this Pledge Agreement to be duly executed and delivered as of the date first
above written.
Pledgor:
ADVANCED RADIO TELECOM CORP.,
a Delaware corporation
By:
-----------------------------------
Name:
Title:
Collateral Agent:
THE BANK OF NEW YORK,
as Collateral Agent
By:
-----------------------------------
Name:
Title:
