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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 2)*
Valassis Communications, Inc.
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(Name of Issuer)
Common Stock, Par Value $.01 Per Share
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(Title of Class Securities)
91886610
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(CUSIP Number)
Neale Martin, Manager, Trustee, Westpac Custodian Nominees Limited
Level 36, 60 Margaret Street
Sydney, New South Wales 2000, Australia 011-612-9-226-2026
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
June 11, 1997
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box ___.
NOTE: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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CUSIP No. 91886610
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<C> <S> <C>
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1. NAME OF REPORTING PERSON
S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Westpac Custodian Nominees Limited
No S.S. Or I.R.S. Identification
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) ___
(b) ___
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3. SEC USE ONLY
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4. SOURCE OF FUNDS Not Applicable
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e)
___
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
New South Wales, Commonwealth of Australia
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NUMBER OF 7. SOLE VOTING POWER None
SHARES --------------------------------------------------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER 20,173,800
OWNED BY EACH --------------------------------------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER None
PERSON --------------------------------------------------------------------------------
WITH 10. SHARED DISPOSITIVE POWER 20,173,800
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
20,173,800
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
___
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
50.3%
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14. TYPE OF REPORTING PERSON
CO
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</TABLE>
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CONTINUATION PAGES OF AMENDMENT NO. 2 TO SCHEDULE 13D
FILED BY
WESTPAC CUSTODIAN NOMINEES LIMITED
This Amendment No. 2 to the Schedule 13D, dated April 15, 1994,
(the "Schedule 13D") as amended by Amendment No. 1 to the Schedule 13D, dated
January 30, 1995 ("Amendment No. 1"), previously filed by Westpac Custodian
Nominees Limited is being filed in connection with changes in the ownership
of the stock of Valassis Communications, Inc., a Delaware corporation (the
"Issuer"), resulting from the transfer of certain shares of common stock,
par value $.01 per share, of the Issuer under certain Stock Pledge Agreements
to which Westpac Custodian is a party and the release of a portion of such
shares from such Stock Pledge Agreements.
In addition, in accordance with Rule 101(a)(2)(ii) of Securities
and Exchange Commission Regulation S-T, this Amendment No. 2 amends and restates
the Schedule 13D, as amended by Amendment No. 1.
ITEM 1. SECURITY AND ISSUER.
This statement relates to the common stock, par value $.01 per
share (the "Common Stock"), of Valassis Communications, Inc., a Delaware
corporation (the "Issuer"). The principal executive offices of the Issuer are at
19975 Victor Parkway, Livonia, Michigan 48152.
ITEM 2. IDENTITY AND BACKGROUND.
The name of the person filing this statement is Westpac Custodian
Nominees Limited ("Westpac Custodian") which has its principal office at Level
36, 60 Margaret Street, Sydney, New South Wales, Australia. Westpac Custodian is
a corporation organized under the laws of Australia, with Australian Company
Number 002 861 565. The principal business of Westpac Custodian is custody and
nominee operations.
Set forth in Schedule A, which is attached hereto and
incorporated by reference, are the (i) names, (ii) addresses and (iii) present
principal occupations or employment of the executive officers and directors (the
"Executive Officers and Directors") of Westpac Custodian. Unless otherwise set
forth in Schedule A, each of such persons is a citizen of Australia and has a
business address at the address of Westpac Custodian.
During the past five years, neither Westpac Custodian nor any of
its Executive Officers or Directors has been convicted in a
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criminal proceeding (excluding traffic violations or similar misdemeanors).
During the last five years, neither Westpac Custodian nor any of
its Executive Officers or Directors has been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction where the result of
such proceeding was the imposition of a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, federal or state securities laws or finding any violation with respect to
such laws.
ITEM 3. SOURCE AND AMOUNT OF CONSIDERATION.
In 1994, 21,200,000 shares of Common Stock (the "Pledged Shares")
were pledged to Westpac Custodian by Conpress Publishing B.V. ("CPBV") to secure
certain obligations of CPBV and its parent, Consolidated Press (Finance) Limited
("Conpress"), under the Facility Agreement (see Item 4). In 1996, the Pledged
Shares were transferred to Conpress Cayman, LDC ("CCLDC") and pledged to Westpac
Custodian to secure certain obligations of CCLDC and others under the Facility
Agreement and under the Cash Advance Facility Agreement (see Item 4). On June
11, 1997, (a) the Pledged Shares were transferred to Conpress International
(Netherlands Antilles) N.V. ("CINA") and pledged to Westpac Custodian to secure
certain obligations of CINA and others under the Facility Agreement and the Cash
Advance Facility Agreement and (b) 1,026,200 of the Pledged Shares were sold
back to the Issuer and released from the pledges (see Item 4).
ITEM 4. PURPOSE OF TRANSACTION.
Pursuant to the Syndicated Bill Facility Agreement, dated as of
March 25, 1994 (the "Facility Agreement"), among Conpress and the other parties
listed therein, as guarantors, certain financial institutions listed therein, as
participants (the "Participants"), Westpac Custodian, as security trustee, and
Australia & New Zealand Banking Group Limited, as agent, the Participants agreed
to provide certain financial accommodations to Conpress. The obligations of
Conpress under the Facility Agreement were secured by the pledge of certain
stock and related collateral, including the pledge of the Pledged Shares. In
addition, the Pledged Shares secured CPBV's guarantee and indemnification
obligations under the Facility Agreement.
On March 25, 1994, CPBV pledged the Pledged Shares to Westpac
Custodian pursuant to the Stock Pledge Agreement, dated as of March 25, 1994
(the "CPBV Pledge Agreement"), between CPBV and Westpac Custodian, in its
capacity as the security trustee for the
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Participants. On January 9, 1995, CPBV transferred the Pledged Shares to
Conpress Investments B.V. ("CIBV") and CIBV and Westpac Custodian entered into a
Stock Pledge Agreement, dated as of January 9, 1995 (the "CIBV Pledge
Agreement"), with respect to the Pledged Shares so transferred. Following such
transfer to CIBV, on January 13, 1995, CIBV transferred the Pledged Shares to
CCLDC and CCLDC and Westpac Custodian entered into a Stock Pledge Agreement,
dated as of January 13, 1995 (the "CCLDC Pledge Agreement"), with respect to
the Pledged Shares so transferred.
The CPBV Pledge Agreement was terminated as of January 9, 1995,
and the CIBV Pledge Agreement was terminated as of January 13, 1995. As of
January 13, 1995, the only stock pledge agreement with respect to the Pledged
Shares in effect was the CCLDC Pledge Agreement.
Westpac Custodian's lien on the Pledged Shares was further
extended to secure certain obligations under a $300,000,000 Cash Advance
Facility Agreement, dated June 27, 1996 (the "Cash Advance Facility Agreement"),
among Kerry Francis Bullmore Packer, as borrower, Consolidated Press Holdings
Limited and the other parties listed on Schedule 1 thereto, as guarantors (the
"Guarantors"), Westpac Custodian, Australia and New Zealand Banking Group
Limited, as agent, and the financial institutions listed on Schedule 2 thereto
(the "Lenders"). A Stock Pledge Agreement, dated June 26, 1996, was entered into
by Westpac Custodian and CCLDC in connection with the Facility Agreement (the
"CCLDC Cash Advance Facility Stock Pledge"). In addition, a Pari Passu Deed,
dated June 27, 1996, provided that the Pledged Shares were to be held on a
pari passu basis as collateral to secure, respectively, certain obligations
under the Facility Agreement and the Cash Advance Facility Agreement.
On June 11, 1997, CCLDC transferred the Pledged Shares to CINA.
CINA and Westpac Custodian entered into a Stock Pledge Agreement, dated as of
June 11, 1997, with respect to the Pledged Shares, securing indebtedness in
connection with the Facility Agreement (the "CINA Stock Pledge"), and a Stock
Pledge Agreement, dated as of June 11, 1997, with respect to the Pledged Shares,
securing indebtedness in connection with the Cash Advance Facility Agreement
(the "CINA Cash Advance Facility Stock Pledge").
The CCL Stock Pledge Agreement and the CCLDC Cash Advance Facility
Stock Pledge were terminated as of June 11, 1997. As of June 11, 1997, the only
stock pledge agreements with respect to the Pledged Shares in effect were and as
of this date are the CINA Stock Pledge and the CINA Cash Advance Facility
Stock Pledge.
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Pursuant to the Stock Option Agreement, dated June 9, 1996, among
the Issuer, CCLDC and Consolidated Press International Limited, as assigned to
CINA by an assignment dated June 5, 1997, the Issuer has repurchased 1,026,200
of the Pledged Shares as of June 11, 1997, and Westpac Custodian has released
such shares from the CINA Stock Pledge and the CINA Cash Advance Facility Stock
Pledge. Therefore, the total number of Pledged Shares as of this date is
20,173,800.
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ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
As of the close of business on June 11, 1997, Westpac Custodian
may be deemed the indirect beneficial owner of 20,173,800 shares of Common
Stock. The Pledged Shares constitute approximately 50.3% of the outstanding
shares of Common Stock of the Issuer (excluding approximately 2,993,814 shares
of Common Stock subject to outstanding options granted by Valassis under certain
stock option plans, of which 2,598,498 were exercisable as of April 30, 1997).
CINA is the direct beneficial owner of the Pledged Shares.
Westpac Custodian disclaims beneficial ownership of the Pledged
Shares.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
Pursuant to the CINA Stock Pledge and the CINA Cash Advance
Facility Stock Pledge, prior to the occurrence of a Potential Event of Default
or an Event of Default (as such terms are defined in the CINA Stock Pledge and
the CINA Cash Advance Facility Stock Pledge), CINA is entitled to exercise all
voting and other consensual rights, and to receive and use cash dividends, with
regard to the Pledged Shares. Upon the occurrence of a Potential Event of
Default or an Event of Default (as such terms are defined in the CINA Stock
Pledge and the CINA Cash Advance Facility Stock Pledge), Westpac Custodian is
entitled to exercise all voting and other consensual rights, and to receive and
use cash dividends, with regard to the Pledged Shares. Westpac Custodian is
required to exercise all rights under (i) the CINA Stock Pledge in accordance
with the terms of the Security Trust Deed, dated as of March 23, 1994, made by
Westpac Custodian in favor of the Participants, and (ii) the CINA Cash Advance
Facility Stock Pledge in accordance with the terms of the Security Trust Deed,
dated as of June 26, 1996, made by Westpac Custodian in favor of the Lenders.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
(c) (i) Stock Pledge Agreement, dated as of June 11, 1997, between CINA, as
Pledgor, and Westpac Custodian, as Trustee, securing indebtedness in
connection with Cash Advance Facility Agreement, dated June 27, 1996, among
Kerry Francis Bullmore Packer, Consolidated Press Holdings Limited, the
Trustee and the Guarantors, Agent and Lenders named therein, and
(ii) Stock Pledge Agreement, dated as of June 11, 1997, between CINA as
Pledgor, and Westpac Custodian, as Trustee, securing
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indebtedness in connection with Syndicated Bill Facility Agreement, dated
as of March 25, 1994, among Consolidated Press (Finance) Limited, the
Trustee and the Guarantors, Agent and Participants named therein.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge, I
certify that the information set forth in this statement is true, complete and
correct.
Date: June 20, 1997
Westpac Custodian Nominees Limited
By: \s\ Neale W. Martin
_____________________________________
Name: Neale W. Martin
Title: Manager, Trustee
By: \s\ Aubrey D. Moore
_____________________________________
Name: Aubrey D. Moore
Title: Manager, Compliance
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Schedule A
Name: John Charles Lawson
Title/Occupation: Company Director
Address: 4 Allerton Road, Beecroft, NSW 2119, Australia
Citizenship: Australia
Name: Alan Campbell Ross
Title/Occupation: Company Director
Address: 3 Farriers Court, Thornton Hill, Wimbledon
London SW194HR, England
Citizenship: United Kingdom
Name: Gary James Angel
Title/Occupation: Company Director
Address: 100 Waratah Place, Narraweena, NSW 2099, Australia
Citizenship: Australia
Name: David Matthew Fite
Title/Occupation: Company Director
Address: 51 Bower Street, Manly N.S.W. 2095, Australia
Citizenship: United States of America
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STOCK PLEDGE AGREEMENT
Between
CONPRESS INTERNATIONAL (NETHERLANDS ANTILLES) N.V.,
as Pledgor,
and
WESTPAC CUSTODIAN NOMINEES LIMITED,
as Trustee
Dated as of June 11, 1997
Securing indebtedness in connection with Cash
Advance Facility Agreement, dated June 27, 1996,
among Kerry Francis Bullmore Packer, Consolidated
Press Holdings Limited, the Trustee and the Guarantors,
Agent and Lenders named therein
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TABLE OF CONTENTS
Page
DEFINITIONS ................................................................ 3
SECTION 2. SECURITY FOR OBLIGATIONS ..................................... 6
SECTION 3. PLEDGE OF SHARES, ETC. ....................................... 6
SECTION 4. REPRESENTATIONS AND WARRANTIES ............................... 7
SECTION 5. VOTING RIGHTS, DIVIDENDS AND OTHER DISTRIBUTIONS, ETC. ....... 9
5.1 Prior to Event of Default or Potential Event of Default ...... 9
5.2 After Event of Default or Potential Event of Default ......... 9
SECTION 6. COVENANTS OF PLEDGOR ......................................... 11
6.1 Sale of Collateral, Etc ...................................... 11
6.2 Delivery of Stock Certificates, Etc .......................... 11
6.3 Other Distributions .......................................... 11
6.4 Records; Location of Records; Inspection ..................... 12
6.5 Costs ........................................................ 12
6.6 Priority of Security Interest; Further Assurances ............ 12
SECTION 7. RIGHTS OF THE TRUSTEE AND THE LENDERS ........................ 13
7.1 No Obligations or Liability to Pledgor ....................... 13
7.2 Right of Trustee to Perform Pledgor's Covenants, Etc ......... 14
7.3 Additional Security .......................................... 14
7.4 Release of the Pledge and Security Interest Created Hereby.... 15
SECTION 8. REMEDIES AND ENFORCEMENT ..................................... 15
8.1 Remedies in Case of an Event of Default ...................... 15
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8.2 Application of Proceeds Following an Event of Default ........ 18
8.3 Purchase of Collateral by Trustee and Lenders ................ 18
8.4 Purchaser to Acquire Good Title .............................. 18
8.5 Sale of Pledged Stock Without Registration ................... 19
8.6 Appointment as Attorney-in-Fact .............................. 20
8.7 Trustee's Right to Enforce Claims ............................ 20
8.8 No Waiver; Cumulative Remedies ............................... 21
8.9 Restoration of Rights and Remedies;
Reinstatement ................................................ 21
SECTION 9. PLEDGOR'S OBLIGATIONS NOT AFFECTED ........................... 22
SECTION 10. THE TRUSTEE .................................................. 23
SECTION 11. MISCELLANEOUS ................................................ 23
11.1 Amendments, Etc .............................................. 23
11.2 Survival of Agreements, Representations and
Warranties ................................................... 24
11.3 Successors and Assigns ....................................... 24
11.4 Entire Agreement ............................................. 24
11.5 Severability ................................................. 25
11.6 Waiver of Jury Trial ......................................... 25
11.7 Agreement May Constitute Financing Statement ................. 25
11.8 Notices ...................................................... 25
11.9 Submission to Jurisdiction; Waiver of Immunity;
Agent for Service of Process ................................. 25
11.10 Currency Equivalent .......................................... 27
11.11 Judgment ..................................................... 27
11.12 Miscellaneous ................................................ 27
11.13 Pari Passu Deed .............................................. 28
11.14 Effective Time; Consent; Release ............................. 28
11.15 Governing Law ................................................ 29
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STOCK PLEDGE AGREEMENT, dated as of June 11, 1997, between
CONPRESS INTERNATIONAL (NETHERLANDS ANTILLES) N.V., a company organized and
existing under the laws of the Netherlands Antilles ("Pledgor") and WESTPAC
CUSTODIAN NOMINEES LIMITED, ACN 002 861 565, a corporation organized and
existing under the laws of New South Wales, Australia, as trustee (the
"Trustee") acting on behalf of the Agent and the Lenders (as both terms are
defined below) under the Facility Agreement referred to in Paragraph A of the
Recitals.
R E C I T A L S
A. Pursuant to the $300,000,000 Cash Advance Facility Agreement,
dated June 27, 1996 (as amended, modified or supplemented from time to time in
accordance with the provisions thereof, the "Facility Agreement"), among Kerry
Francis Bullmore Packer, as borrower (the "Borrower"), Consolidated Press
Holdings Limited ("Holdings") and the other parties listed on Schedule 1
thereto, as guarantors (the "Guarantors"), Westpac Custodian Nominees Limited,
the Trustee and Australia and New Zealand Banking Group Limited, as agent (the
"Agent") and the financial institutions listed on Schedule 2 thereto (the
"Lenders"), the Lenders have agreed to provide certain cash advances to the
Borrower.
B. Pursuant to the Accession Deed, dated the date hereof,
executed by Pledgor (the "Accession Deed"), Pledgor has guaranteed, among other
things, the prompt and timely payment and performance of the Borrower under the
Facility Agreement.
C. Pledgor is the purchaser from Conpress Cayman, LDC, a Company
Limited by Shares organized and existing under the laws of the Cayman Islands
("CCLDC"), of
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21,200,000 shares of common stock of Valassis Communications, Inc., a Delaware
corporation (the "Issuer") as described in Schedule I attached hereto (the
"Shares").
D. The Pledgor is concurrently pledging the Collateral (as
hereinafter defined) to Westpac Custodian Nominees Limited (the "First Pledgee")
acting as trustee for certain lenders (the "First Lenders") to secure certain
indebtedness and related obligations of its affiliate, Consolidated Press
(Finance) Limited (the "First Borrower"), to the First Lenders as well as the
guaranty (the "First Guaranty") of such indebtedness, as well as indebtedness
arising under the Accession Deed, by the Pledgor (such indebtedness and related
obligations and the obligations of the Pledgor under the First Guaranty,
collectively, the "First Secured Obligations").
E. The Pledgor is required to execute and deliver this Agreement
to the Trustee as a condition precedent to the Lenders' obligations to provide,
or continue to provide, cash advances under the Facility Agreement.
F. The First Pledgee and the Trustee have entered into a Pari
Passu Deed, dated June 27, 1996 (as amended, modified or supplemented from time
to time in accordance with the terms thereof, the "Pari Passu Deed") among
Holdings, the Pledgor, the Trustee, the First Pledgee and certain other Persons
pursuant to which the First Pledgee has agreed, among other things, to hold the
Collateral on a pari passu basis as collateral to secure, respectively, the
obligations of the First Borrower and Pledgor to the First Lenders and the
obligations of the Borrower and the Pledgor to the Lenders.
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NOW, THEREFORE, to induce the Lenders to provide, or continue to
provide, certain financial accommodations to the Borrower, and for other good
and valuable consideration, the receipt and sufficiency or which is hereby
acknowledged, Pledgor hereby agrees with the Trustee for the benefit of the
Lenders as follows:
SECTION 1. CERTAIN DEFINITIONS.
Capitalized terms used herein without other definition have the
meanings assigned thereto in the Facility Agreement. The following capitalized
terms are used herein with the respective meanings set forth below.
ACCESSION DEED: the meaning given in Paragraph B of the Recitals.
AGENT: the meaning given in Paragraph A to the Recitals.
BORROWER: the meaning given in Paragraph A of the Recitals.
CAPITAL STOCK: the Shares and all other capital stock or other
equity securities of any class of the Issuer.
CCLDC: the meaning given in Paragraph C of the Recitals.
COLLATERAL: the meaning given in the first paragraph of
Section 3.
DOLLARS: dollars of the United States of America.
EQUITABLE MORTGAGE: the Equitable Mortgage of Shares, dated June
26, 1996, between Westpac Custodian
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Nominees Limited and the corporations named in Schedule 1 thereto, as amended,
modified or supplemented from time to time in accordance with the terms thereof.
FACILITY AGREEMENT: the meaning given in Paragraph A of the
Recitals.
FIRST BORROWER: the meaning given in Paragraph D of the Recitals.
FIRST GUARANTY: the meaning given in Paragraph D of the Recitals.
FIRST LENDERS: the meaning given in Paragraph D of the Recitals.
FIRST PLEDGEE: the meaning given in Paragraph D of the Recitals.
FIRST SECURED OBLIGATIONS: the meaning given in Paragraph D of
the Recitals.
GUARANTY: the guarantee and indemnity provided by Pledgor under
Sections 11 and 12 of the Facility Agreement.
HOLDINGS: the meaning given in Paragraph A of the Recitals.
ISSUER: the meaning given in Paragraph C of the Recitals.
LENDERS: the meaning given in Paragraph A to the Recitals.
NYUCC: the Uniform Commercial Code of the State of New York.
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OTHER CURRENCY: the meaning given in Section 11.11.
PARI PASSU DEED: the meaning given in Paragraph F to the
Recitals.
PERMITTED SECURITY INTEREST: means the liens and security
interests created by the First Equitable Mortgage of Shares and the Second
Equitable Mortgage of Shares (each as defined in the Pari Passu Deed).
PERSON: means any individual, corporation, partnership, business
trust, joint venture, association, joint stock company, trust, unincorporated
organization of government or any agency or political subdivision thereof.
PLEDGED STOCK: the Shares and all other securities constituting
part of the Collateral.
PLEDGOR: the meaning provided in the introductory paragraph to
this Agreement.
SECURED OBLIGATIONS: the meaning given in Section 2.
SHARES: the meaning given in Paragraph C of the Recitals.
TRUSTEE: the meaning provided in the introductory paragraph to
this Agreement.
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SECTION 2. SECURITY FOR OBLIGATIONS.
This Agreement secures, and the Collateral is security for, the
prompt payment in full when due, whether at stated maturity, by acceleration or
otherwise, and performance of all obligations of Pledgor to the Trustee, the
Agent and the Lenders under the Guaranty and this Agreement and all obligations
of the Borrower to the Trustee, the Agent and the Lenders under the Facility
Agreement and the other Transaction Documents, whether now existing or hereafter
incurred (collectively, the "Secured Obligations"). The term "Secured
Obligations" includes, without limitation, all interest (including, without
limitation, interest accruing after the date of any filing by the Borrower or
the Pledgor of any petition in bankruptcy or the commencement of any bankruptcy,
insolvency or similar proceeding with respect to the Borrower or the Pledgor),
charges, expenses, fees, attorneys' fees and other sums required to be paid by
the Pledgor or the Borrower under the Facility Agreement or any of the other
Transaction Documents.
SECTION 3. PLEDGE OF SHARES, ETC.
As security for the prompt payment and performance of the Secured
Obligations when due (whether at stated maturity, by acceleration or otherwise),
Pledgor hereby conveys, assigns, grants, hypothecates, mortgages, pledges,
transfers and delivers to the Trustee, and hereby grants to the Trustee a lien
and charge upon, and a security interest in, all the following property, whether
now owned or hereafter acquired and whether now or in the future existing
(collectively, the "Collateral"):
(a) the Shares;
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(b) all dividends, instruments, cash and other property or rights
of any kind at any time received, receivable or otherwise distributed or
distributable with respect to the Shares (including, without limitation,
in connection with a reorganization, reclassification, consolidation,
merger, subdivision or similar transaction involving the Issuer) except
as provided for herein;
(c) all certificates or other writings representing or evidencing
any of the foregoing;
(d) all proceeds of any of the property described in clauses (a)
through (c) above; and
(e) all books, correspondence, credit files, electronic data,
records, invoices and other papers and documents relating to any of the
foregoing.
SECTION 4. REPRESENTATIONS AND WARRANTIES.
Pledgor represents and warrants to the Trustee and each Lender as
follows:
(a) Pledgor is a corporation duly organized, validly existing and
in good standing under the laws of the Netherlands Antilles and has all
requisite corporate power and authority to enter into and carry out the
terms of this Agreement.
(b) The execution, delivery and performance of this Agreement
will not result in any violation of or be in conflict with or constitute
a default under any term of Pledgor's certificate of incorporation or
by-laws or any agreement or instrument to which Pledgor is
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a party or by which it is bound or any term of any applicable law,
ordinance, rule or regulation of any governmental authority or any term
of any applicable order, judgment or decree of any court, arbitrator or
governmental authority.
(c) No consent, approval or authorization of, or declaration or
filing with, any Person is required for the valid execution, delivery
and performance of this Agreement.
(d) This Agreement has been duly authorized, executed and
delivered by Pledgor and constitutes its legal, valid and binding
obligation, enforceable against Pledgor in accordance with its terms,
except to the extent that such enforcement may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws of
general application relating to or affecting the rights and remedies of
creditors, and by general equitable principles.
(e) Pledgor is the legal and beneficial owner of the Shares, free
and clear of any security interest except for the security interest
created by this Agreement, the Equitable Mortgage and the Permitted
Security Interests.
(f) The Shares have been duly authorized, validly issued and are
fully paid and non-assessable.
(g) Upon delivery to the Trustee or a Person (other than the
Pledgor) acting as agent for the Trustee of the certificate or
certificates evidencing the Shares, the security interest granted
pursuant to this Agreement will constitute a valid perfected first
priority security interest in the Shares, enforceable
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as such against all creditors of Pledgor and any Persons purporting to
purchase any Shares from Pledgor.
SECTION 5. VOTING RIGHTS, DIVIDENDS AND OTHER
DISTRIBUTIONS, ETC.
5.1 Prior to Event of Default or Potential Event of Default.
Unless an Event of Default or a Potential Event of Default has occurred and is
continuing, Pledgor will remain entitled to exercise any and all voting and
other consensual rights pertaining to the Pledged Stock and to receive, retain
and use cash dividends paid in respect of the Pledged Stock (it being understood
that, so long as no Event of Default or Potential Event has occurred and is
continuing, all such cash dividends shall be released from the pledge and
security interest granted to the Trustee hereunder from and after the date of
such payment).
5.2 After Event of Default or Potential Event of Default. For
so long as an Event of Default or Potential Event of Default is continuing, (i)
Pledgor may not exercise any such voting or other consensual rights without the
prior written consent of the Trustee (which consent shall not be unreasonably
withheld in the case of a Potential Event of Default), and (ii) the right, if
any, of Pledgor to receive cash dividends in respect of the Pledged Stock will
cease (unless the Trustee shall have consented to the Pledgor's retention of
such cash dividends, which consent shall not be unreasonably withheld in the
case of a Potential Event of Default) and all such dividends must be paid
directly to the Trustee (or if received by Pledgor will be deemed held in trust
by Pledgor for the benefit of, and must be turned over immediately by Pledgor
to, the Trustee) and thereafter will be held and disposed of by the Trustee as
part of the Collateral. If an Event of Default or a Potential Event of
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Default is continuing and the Trustee has not consented to the Pledgor's
continued exercise of voting or other consensual rights as set forth in the
preceding sentence, the Trustee may elect to exercise voting and other
consensual rights hereunder by giving notice of such election to the Pledgor.
Thereafter, all rights of Pledgor to exercise the voting and other consensual
rights which Pledgor would otherwise be entitled to exercise pursuant to Section
5.1 will cease, all such rights will thereupon become vested in the Trustee, who
during the continuance of such Potential Event of Default or Event of Default
will have (directly or through its nominee) the sole right to exercise such
voting and other consensual rights, including, without limitation, (A) all
voting, corporate and other rights pertaining to any of the Pledged Stock, (B)
all rights to give consents, waivers and ratifications in respect thereof and
(C) any and all rights of conversion, exchange, subscription and any other
rights, privileges or options pertaining to any of the Pledged Stock as if it
were the absolute owner thereof, and in connection therewith, the right to
deposit and deliver any and all of the Pledged Stock with any committee,
depositary, transfer agent, registrar or other designated agency upon such terms
and conditions as it may determine, all without liability except to account for
property actually received by it (the Pledgor hereby irrevocably constituting
and appointing the Trustee the proxy and attorney-in-fact of Pledgor, with full
power of substitution, to do or take any of the above actions). The Trustee will
have no duty to Pledgor to exercise any such right, privilege or option and will
not be responsible for any failure to do so or delay in so doing. In order to
permit the Trustee to exercise the voting and other consensual rights which it
may be entitled to exercise pursuant to this Section 5.2, and to receive all
dividends and distributions which it may be entitled to receive under this
Section 5.2, the Pledgor will, upon written notice from
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the Trustee, from time to time execute and deliver to the Trustee appropriate
proxies, dividend payment orders and other instruments as the Trustee may
reasonably request.
SECTION 6. COVENANTS OF PLEDGOR.
6.1 Sale of Collateral, Etc. Pledgor will not (i) sell, assign,
transfer, convey, or otherwise dispose of, or grant any option 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 and security interest
created by this Agreement, the Equitable Mortgage and the Permitted Security
Interests.
6.2 Delivery of Stock Certificates, Etc. Pledgor will
immediately deliver to the Trustee all certificates or other writings
representing or evidencing any of the Shares and any other "securities" or
"instruments" (as such terms are defined in the NYUCC) included in the
Collateral at any time acquired or received by Pledgor, directly or indirectly,
either in suitable form for transfer by delivery, or issued in the name of
Pledgor and accompanied by stock powers or other appropriate instruments of
transfer or assignment, duly executed by Pledgor in blank and undated, and in
either case having attached thereto all requisite federal or state stock
transfer tax stamps, all in form and substance satisfactory to the Trustee.
6.3 Other Distributions. Except for cash dividends permitted to
be paid to Pledgor pursuant to Section 5.1, Pledgor will cause all dividends and
distributions of any kind on the Pledged Stock (including any sums paid upon or
in respect of the Pledged Stock upon the liquidation or dissolution of the
Issuer thereof or upon the recapitalization or reclassification of the capital
of the Issuer
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thereof or upon the reorganization of the Issuer thereof) to be paid directly to
the Trustee (and if any such dividends or distributions are received by Pledgor,
Pledgor will hold them in trust for the benefit of, and will immediately turn
them over to, the Trustee) and the Trustee will hold and dispose of all such
dividends and distributions as part of the Collateral.
6.4 Records; Location of Records; Inspection. Pledgor will keep
full and accurate books and records relating to the Pledged Collateral, and
stamp or otherwise mark such books and records in such manner as is required in
order to reflect the pledge and security interest granted pursuant hereto.
Pledgor will permit representatives of the Trustee at any time upon reasonable
advance notice to inspect and make abstracts from its books and records
pertaining to the Collateral and to discuss matters relating to the Collateral
with officers of Pledgor.
6.5 Costs. Pledgor indemnifies the Trustee against, and shall
pay the Trustee on demand the amount of, all losses, liabilities, costs and
expenses referred to in Section 16.3 of the Facility Agreement in respect of
this Agreement.
6.6 Priority of Security Interest; Further Assurances. (a)
Pledgor will at all times cause the security interest granted pursuant to this
Agreement to constitute a valid perfected first priority security interest in
the Collateral subject only to the Permitted Security Interests, enforceable as
such against all creditors of Pledgor and any Persons purporting to purchase any
Collateral from Pledgor.
(b) Pledgor will at any time and from time to time, at its own
expense, promptly execute and deliver all further instruments and documents, and
take all further
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actions, as may be necessary or desirable, or that the Trustee or any Lender may
reasonably request, in order to (i) grant more effectively a security interest
in favor of the Trustee in all or any portion of the Collateral, (ii) maintain,
preserve, or perfect the security interest and lien created or purported to be
created by this Agreement and the first priority status of such security
interest and lien, (iii) preserve and defend against any Person Pledgor's title
to the Collateral and the rights purported to be granted therein by this
Agreement, (iv) enable the Trustee and the Lenders to exercise and enforce their
rights and remedies hereunder, or (v) carry out more effectively the purposes of
this Agreement.
SECTION 7. RIGHTS OF THE TRUSTEE AND THE LENDERS.
7.1 No Obligations or Liability to Pledgor. The rights and
powers of the Trustee hereunder are not contingent upon the pursuit by the
Trustee of any right or remedy against Pledgor or against any other Person which
may be or become liable in respect of any of the Secured Obligations or against
any other collateral security or guarantee therefor or right of offset with
respect thereto, but are solely to protect its interest in the Collateral.
Neither the Trustee nor any Lender nor any Person acting on their behalf will be
liable for any failure to demand, collect or realize upon all or any part of the
Collateral or for any delay in doing so, nor is the Trustee under any obligation
to sell or otherwise dispose of any Collateral upon the request of Pledgor or
any other Person or to take any other action whatsoever with regard to the
Collateral or any part thereof. No action or inaction on the part of the Trustee
hereunder or under any of the other Transaction Documents will release Pledgor
from any of its obligations hereunder or under any of the other Transaction
Documents, or
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constitute an assumption of any such obligations on the part of the Trustee, or
cause the Trustee to become subject to any obligation or liability to Pledgor.
The Trustee has no obligation to perform any of the obligations or duties of
Pledgor as a shareholder of the Issuer.
7.2 Right of Trustee to Perform Pledgor's Covenants, Etc. If
Pledgor fails to make any payment or to perform any agreement required to be
made or performed hereunder, the Trustee may (but need not) at any time
thereafter make such payment or perform such act, or otherwise cause such
payment or performance. No such action will create any liability to Pledgor on
the part of the Trustee. All amounts so paid by the Trustee and all costs and
expenses (including, without limitation, attorneys' fees and expenses) incurred
by the Trustee in any such performance shall accrue interest from the date paid
or disbursed until reimbursed to the Trustee in full by or on behalf of Pledgor
at the rate established in Section 21 of the Facility Agreement. All such
amounts shall constitute additional indebtedness of the Pledgor secured
hereunder and shall be payable on demand.
7.3 Additional Security. Without notice to or consent of
Pledgor and without impairment of the security interest and rights granted
pursuant to this Agreement, the Trustee or the Lenders may accept, from the
Borrower or from any other Person or Persons, additional security for the
Secured Obligations. Neither the giving of this Agreement nor the acceptance of
any such additional security will prevent the Trustee or the Lenders from
resorting, first to such additional security, or, first to the security created
by this Agreement, in either case without affecting the Trustee's security
interest and rights granted pursuant to this Agreement.
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7.4 Release of the Pledge and Security Interest Created Hereby.
Subject to the Pari Passu Deed and the rights of the First Pledgee, upon payment
in full of the Secured Obligations and the termination of the Facility
Agreement, the Trustee will, upon the written request of Pledgor, return to the
Pledgor all Collateral held by the Trustee and if the Pledgor so requests,
execute and deliver to, or as directed in writing by, the Pledgor an appropriate
instrument (in due form for recording or filing) sufficient to release from the
pledge and security interest created hereby the Collateral and all other
property subject thereto.
SECTION 8. REMEDIES AND ENFORCEMENT.
8.1 Remedies in Case of an Event of Default. If an Event of
Default has occurred and is continuing, then in addition to the actions referred
to in Section 5.2 the Trustee may take any or all of the following actions,
without demand of performance or other demand, advertisement or notice of any
kind to or upon Pledgor or any other Person (except as specified in Section
8.1(b)) all and each of which are hereby expressly waived by Pledgor:
(a) The Trustee may, in its own name or at its sole option in
the name of Pledgor, exercise any or all of the rights, powers and
privileges of, and pursue any or all of the remedies accorded to,
Pledgor under the Collateral and may exclude Pledgor and all Persons
claiming by, through or under Pledgor wholly or partly therefrom,
including in such rights, privileges and remedies, but without
limitation, all rights of Pledgor to demand, receive, sue for,
compromise and settle all payments in respect of the Collateral, and in
connection therewith to exercise all rights and remedies
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thereunder which Pledgor could enforce if this Agreement had not been
made.
(b) The Trustee may forthwith collect, recover, receive,
appropriate and realize upon the Collateral, or any part thereof, and/or
may forthwith sell, assign, give an option or options to purchase,
contract to sell or otherwise dispose of and deliver the Collateral, or
any part thereof, in one or more parcels at public or private sale or
sales, at any exchange, broker's board or at any of the Trustee's
offices or elsewhere upon such terms and conditions as it may deem
advisable and at such prices as it may deem best, for cash or on credit
or for future delivery without assumption of any credit risk. The
Trustee need not make any sale of Collateral even if notice thereof has
been given, may reject any and all bids that in its commercially
reasonable discretion it shall deem inadequate, and may adjourn any
public or private sale. Pledgor hereby acknowledges that the Collateral
is of a type that could decline speedily in value and is also of a type
customarily sold on a recognized market, in each case within the meaning
of Section 9-504 of the NYUCC as in effect in any applicable
jurisdiction, and that the Trustee need not give any notice to Pledgor
prior to any sale of the Collateral at any exchange, broker's board or
in any other recognized market. Without limiting the foregoing, Pledgor
agrees that the Trustee need not give more than 10 days notice of the
time and place of any public sale or of the time after which a private
sale or other intended disposition is to take place and that such notice
is reasonable notification of such matters, and waives all other demands
or notices of any kind. Any such disposition which shall be a private
sale or other private proceedings permitted by the requirements of
applicable law shall
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be made only after written notice to Pledgor specifying the time at
which such disposition is to be made and the intended sale price or
other consideration therefor.
(c) The Trustee may, as a matter of right and without notice to
Pledgor or any Person claiming by, through or under Pledgor, cause the
appointment of a receiver for all or any part of the Collateral.
(d) In addition to all other rights and remedies granted to it in
this Agreement and in any other instrument or agreement securing,
evidencing or relating to any of the Secured Obligations, the Trustee
will have and may exercise with respect to any or all of the Collateral
all of the rights and remedies of a secured party under the NYUCC.
(e) The Trustee may, without the consent of the Pledgor, cause
any or all of the Pledged Stock to be registered in the name of the
Trustee or its nominee.
Pledgor consents to and ratifies any action which the Trustee may
take to enforce its rights under this Section 8.1. Pledgor waives to the full
extent permitted by law the benefit of all appraisement, valuation, stay,
extension, moratorium and redemption laws now or hereafter in force and all
rights of marshalling in the event of the sale of the Collateral or any part
thereof or any interest therein. Pledgor will execute and deliver such documents
as the Trustee deems advisable or necessary in order that any such sale or
disposition be made in compliance with applicable law.
Any sale or other disposition of the Collateral or any part
thereof or interest therein in the exercise of any
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remedy hereunder will constitute a perpetual bar against Pledgor and any Persons
claiming by, through or under Pledgor. Upon any such sale or other disposition,
the receipt of the officer making the sale or other disposition or of the
Trustee is a sufficient discharge to the purchaser for the purchase money, and
such purchaser will have no duty to see to the application thereof.
8.2 Application of Proceeds Following an Event of Default. All
amounts held or collected by the Trustee as part of the Collateral (including,
without limitation, all amounts realized as a result of the exercise of any
rights and remedies hereunder) following the occurrence of any Event of Default
will be applied forthwith by the Trustee as provided in the Pari Passu Deed.
8.3 Purchase of Collateral by Trustee and Lenders. To the
extent permitted by applicable law, either the Trustee or any Lender may be a
purchaser of the Collateral or any part thereof or any interest therein at any
sale or other disposition hereunder and may apply against the purchase price the
indebtedness secured hereby owing to such purchaser, to the extent of such
purchaser's distributive share of the purchase price.
8.4 Purchaser to Acquire Good Title. Any purchaser of the
Collateral at any sale or other disposition thereof pursuant to this Section 8
will, upon any such purchase, acquire good title to the Collateral so purchased
free of the lien and security interest created by this Agreement and free of all
rights of equity or redemption in Pledgor, which rights Pledgor hereby expressly
waives and releases to the full extent permitted by law, and Pledgor will
warrant and defend the title of such purchaser against all claims arising by,
through or under the Pledgor. Nevertheless, if so requested by the Trustee or
any such purchas-
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er, Pledgor will ratify and confirm any exercise of remedies by the Trustee
hereunder by executing and delivering to the Trustee or such purchaser all bills
of sale, assignments, releases and other proper instruments to effect such
ratification and confirmation as may be designated in any such request. In
addition, Pledgor will do or cause to be done all such other acts and things as
may be reasonably necessary to make such exercise of remedies valid and binding
and in compliance with any and all applicable laws, regulations, orders, writs,
injunctions, decrees or awards of any and all courts, arbitrators or
governmental instrumentalities, domestic or foreign, having jurisdiction over
any such exercise, all at Pledgor's expense.
8.5 Sale of Pledged Stock Without Registration. Pledgor
recognizes that (i) the Trustee may be unable to effect a public sale of any or
all of the Pledged Stock by reason of the Securities Act of 1933, as amended
(the "Securities Act"), and applicable state or foreign securities laws or
otherwise, but may be compelled to resort to one or more private sales thereof
to a restricted group of purchasers who will be obliged to agree, among other
things, to acquire such securities for their own account for investment and not
with a view to the distribution or resale thereof and who otherwise satisfy the
requirements of any such applicable law, and (ii) any such private sale may
result in prices and other terms less favorable to the seller than if such sale
were a public sale. No such sale will be deemed to have been made in a
commercially unreasonable manner solely for the reason that it was made as a
private sale rather than a public sale, and the Trustee will be under no
obligation to delay a sale of any of the Pledged Stock for the period of time
necessary to permit the issuer of such securities to register such securities
for public sale under the Securities Act, or under applicable state securities
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laws, or otherwise comply with applicable law, even if the Issuer would agree to
do so and would be able to do so.
8.6 Appointment as Attorney-in-Fact. Pledgor hereby irrevocably
constitutes and appoints the Trustee, with full power of substitution, as
Pledgor's attorney-in-fact, with full irrevocable power and authority in the
place and stead of Pledgor and in the name of Pledgor or otherwise, from time to
time in the Trustee's discretion, to execute and deliver any and all bills of
sale, assignments or other instruments which the Trustee may deem necessary or
advisable in its exercise of any of the remedies hereunder, and to take any
other action to accomplish the purposes of this Agreement, including, without
limitation, to ask, demand, collect, sue for, recover, compound, receive and
give acquittance and receipt for moneys due and to become due under or in
connection with the Collateral, to receive, endorse, and collect any drafts or
other instruments, documents and chattel paper in connection therewith, and to
file any claims or take any action or institute any proceedings which the
Trustee may deem to be necessary or desirable for the collection thereof,
Pledgor hereby ratifying and confirming all that such attorney or any substitute
may lawfully do by virtue hereof. This power of attorney is a power coupled with
an interest and is irrevocable. The Trustee agrees that, except upon the
occurrence of an Event of Default and during the continuance thereof, it will
not exercise the power of attorney or any other rights granted to it pursuant to
this Section 8.6.
8.7 Trustee's Right to Enforce Claims. All rights of action and
claims under this Agreement may be prosecuted and enforced by the Trustee, and
any such proceeding instituted by the Trustee may be brought in its own name as
trustee of an express trust. Any recovery of judgment in any such proceeding
will, after provision for the
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payment of the costs and expenses of the sale or other realization upon the
Collateral, be, subject to the Pari Passu Deed, for the ratable benefit of the
Lenders.
8.8 No Waiver; Cumulative Remedies. No action or inaction of
the Trustee will be deemed to waive any of the rights, powers or remedies of the
Trustee hereunder except pursuant to a writing, signed by the Trustee, and then
only to the extent expressly set forth therein. A waiver by the Trustee of any
right, power or remedy on any one occasion will not bar the exercise of any
right, power or remedy hereunder on any future occasion. No failure of the
Trustee to exercise nor delay of the Trustee in exercising any right, power or
remedy will preclude the exercise of any other right, power or remedy. If the
Trustee accepts payment of any amount secured hereby after its due date, it will
not thereby be deemed to have waived its right to require prompt payment when
due of all other amounts payable hereunder. Each right, power and remedy of the
Trustee provided for in this Agreement or now or hereafter existing at law or
equity or by statute or otherwise is cumulative and concurrent and is in
addition to every other such right, power or remedy of the Trustee, and the
exercise of any one or more of any such rights, powers or remedies with respect
to any of the Collateral will not preclude the simultaneous or later exercise by
the Trustee of any other right, power or remedy with respect to any other
Collateral.
8.9 Restoration of Rights and Remedies; Reinstatement. (a) If
the Trustee has instituted any proceeding to enforce any right, power or remedy
under this Agreement and such proceeding has been discontinued or abandoned for
any reason, with or without notice to Pledgor, or has been determined adversely
to the Trustee, then and in every such case Pledgor and the Trustee will be
restored to their former positions hereunder, and thereafter all rights,
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powers and remedies of the Trustee will continue as though no such proceeding
had been instituted.
(b) If the Trustee has applied any amount against the Secured
Obligations and, thereafter, all or any part of any payment previously applied
by the Trustee is required to be rescinded or returned on account of any
applicable bankruptcy, insolvency, reorganization or similar law affecting
creditors rights generally, the Pledgor's obligations hereunder shall be
reviewed and reinstated to the extent of such payment, as though such payment
had not been made.
SECTION 9. PLEDGOR'S OBLIGATIONS NOT AFFECTED.
The covenants and agreements of Pledgor set forth herein are
primary obligations of Pledgor. All such obligations are absolute and
unconditional, are not subject to any counterclaim, set-off, deduction,
diminution, abatement, recoupment, suspension, deferment, reduction or defense
(other than full and strict compliance by Pledgor with its obligations
hereunder) based upon any claim Pledgor, the Issuer, the Borrower or any other
Person may have against the Trustee, any Lender or any other Person. All such
obligations will remain in full force and effect without regard to, and will not
be released, discharged or in any way affected by, any unenforceability,
invalidity or other infirmity with respect to any Transaction Document, or any
other circumstance, condition or occurrence whatsoever, whether foreseeable or
unforeseeable and without regard to whether Pledgor, the Issuer or the Trustee
or any Lender shall have any knowledge or notice thereof.
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SECTION 10. THE TRUSTEE.
The Trustee accepts the trust hereby created and agrees to
perform the same and to receive and disburse all monies received by it as
trustee hereunder in accordance with the terms hereof. The Trustee is entering
into this Agreement solely as trustee and not in its individual capacity (except
as expressly provided herein), and in no case whatsoever shall the Trustee be
personally liable for, or for any loss in respect of, this Agreement, or for any
action or inaction of Pledgor or Lenders, as to which all interested parties
shall look solely to the Collateral and such other moneys or property as are
from time to time held by the Trustee as trustee hereunder, provided that the
Trustee shall be responsible in its individual capacity to the Lenders and to
Pledgor for its own willful misconduct or gross negligence. THE TRUSTEE MAKES NO
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, (a) AS TO THE TITLE OR VALUE OF
THE COLLATERAL, OR ANY OTHER REPRESENTATION OR WARRANTY WITH RESPECT TO THE
COLLATERAL WHATSOEVER, (b) as to the validity or enforceability of this Pledge
Agreement or any other Transaction Document or (c) as to the occurrence of any
statement contained in any thereof.
SECTION 11. MISCELLANEOUS.
11.1 Amendments, Etc. Any amendment, modification or waiver of
any term or provision of this Agreement must be in writing and signed by the
Trustee and the Pledgor. Any such waiver will be effective only in the specific
instance and for the specific purpose for which it is given. Pledgor must
deliver an executed counterpart or a correct copy of any amendment, modification
or waiver effected pursuant to this Section 11.1 to each Lender promptly after
it has become effective.
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11.2 Survival of Agreements, Representations and Warranties.
All agreements, representations and warranties contained in this Agreement, the
Facility Agreement or the other Transaction Documents to which Pledgor is a
party or made in writing by or on behalf of Pledgor in connection with the
transactions contemplated by this Agreement, the Facility Agreement or the other
Transaction Documents to which Pledgor is a party will survive the execution and
delivery of this Agreement, any investigation at any time made by or on behalf
of the Trustee or the Lenders, the making of any loan under the Facility
Agreement or the repayment thereof or thereunder. All statements contained in
any certificate or other instrument delivered by or on behalf of Pledgor
pursuant to this Agreement or the other Transaction Documents to which Pledgor
is a party or in connection with the transactions contemplated by this Agreement
or the other Transaction Documents to which Pledgor is a party are to be deemed
representations and warranties of Pledgor under this Agreement.
11.3 Successors and Assigns. This Agreement is binding upon and
will inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto, whether so expressed or not, and, in particular,
inure to the benefit of and be enforceable by each Lender.
11.4 Entire Agreement. This Agreement, the Facility Agreement
and the other Transaction Documents to which Pledgor is a party embody the
entire agreement and understanding between Pledgor and the Trustee and the
Lenders with respect to the transaction referred to herein and supersede all
prior agreements and understandings, written or oral, relating to the pledge of
collateral to the Trustee to secure the obligations of the Pledgor under the
Facility Agreement.
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11.5 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction is, as to such jurisdiction,
ineffective only to the extent made necessary by such prohibition or
unenforceability. Any such prohibition or unenforceability in any jurisdiction
will not invalidate or render unenforceable (i) the remaining provisions hereof
or (ii) such provision in any other jurisdiction.
11.6 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
IRREVOCABLY AND UNCONDITIONALLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LEGAL
OR EQUITABLE ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OF THE OTHER TRANSACTION DOCUMENTS OR ANY TRANSACTION
CONTEMPLATED HEREBY OR THEREBY OR THE SUBJECT MATTER OF ANY OF THE FOREGOING.
11.7 Agreement May Constitute Financing Statement. Pledgor
consents to the filing of this Agreement or a photocopy thereof as a financing
statement under the Uniform Commercial Code as in effect in any jurisdiction in
which the Trustee may determine such filing to be necessary or desirable.
11.8 Notices. If any notice or other communication is required
or permitted to be given under any of the provisions of this Agreement to
Pledgor or the Trustee, such notice shall be given in the manner and to the
addresses provided in Section 22.3 of the Facility Agreement.
11.9 Submission to Jurisdiction; Waiver of Immunity; Agent for
Service of Process. For the purpose of assuring that the Trustee and the
Lenders can enforce their rights under this Agreement, the Pledgor, for itself
and its successors and assigns, hereby irrevocably (a) agrees that
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any legal or equitable action, suit or proceeding against the Pledgor arising
out of or relating to this Agreement or any transaction contemplated hereby or
the subject matter of any of the foregoing may be instituted in any state or
federal court in the State of New York, (b) waives any objection which it may
now or hereafter have to the venue of any such action, suit or proceeding, (c)
irrevocably submits itself to the nonexclusive jurisdiction of any state or
federal court of competent jurisdiction in the State of New York for purposes of
any such action, suit or proceeding, and (d) irrevocably waives any immunity
from jurisdiction to which it might otherwise be entitled in any such action,
suit or proceeding which may be instituted in any state or federal court in the
State of New York, and irrevocably waives any immunity from the maintaining of
an action against it to enforce any judgment for money obtained in any such
action, suit or proceeding and, to the extent permitted by applicable law, any
immunity from execution. The Pledgor hereby designates and appoints CT
Corporation System (or any successor corporation), at its office at 1633
Broadway, New York, New York 10019, as its authorized agent to accept and
acknowledge on its behalf service of any and all process which may be served in
any such action, suit or proceeding solely with respect to any matter as to
which it has submitted to jurisdiction as set forth in this Section 11.9, and
agrees that proper service upon such authorized agent shall be deemed in every
respect service of process upon the Pledgor or its successors or assigns, and,
to the extent permitted by applicable law, shall be taken and held to be valid
personal service upon it. Such designation and appointment shall be irrevocable.
The Pledgor represents and warrants that CT Corporation System has agreed to act
as such agent for service of process. The Pledgor will take all action,
including the filing of any and all documents and instruments, as may be
necessary to continue in full force and effect the designation and appointment
as such
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agent of CT Corporation System or any successor corporation or such other
corporation as shall be satisfactory to the Trustee and the Lenders, so that the
Pledgor shall at all times have an agent for service of process for the above
purposes in the County of New York, State of New York. Nothing contained in this
Section 11.9 shall be deemed to affect the right of the Trustee and the Lenders
to serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against the Pledgor in any jurisdiction.
11.10 Currency Equivalent. For purposes of the construction of
this Agreement, the equivalent in Dollars of an amount in any other currency
shall be determined at the rate of exchange quoted by Westpac Banking
Corporation, New York Branch, in New York City, at 9:00 A.M. (New York City
time) on the Business Day immediately preceding the date of determination, to
prime banks in New York City for the spot purchase in the New York foreign
exchange market of Dollars with such other currency.
11.11 Judgment. If for the purpose of obtaining judgment in any
court it is necessary for the Trustee or any Lender to convert a sum due
hereunder in Dollars into another currency (the "Other Currency"), the Pledgor
agrees, to the extent permitted by applicable law, that the rate of exchange
used shall be that at which in accordance with normal banking procedures the
Trustee could purchase the Dollars with the Other Currency on the Business Day
preceding that on which final judgment is given.
11.12 Miscellaneous. This Agreement may be executed in any
number of counterparts, each of which is an original, but all of which together
constitute but one instrument. Except as otherwise indicated, references herein
to any "Section" means a "Section" of this Agreement. The
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<PAGE>
table of contents and the section headings in this Agreement are for purposes of
reference only and shall not limit or define the meaning hereof.
11.13 Pari Passu Deed. The parties hereto acknowledge that so
long as any of the First Secured Obligations remain outstanding, all of the
rights, duties, privileges and obligations of the Trustee hereunder shall be
exercised by either the Trustee or the First Pledgee as provided in the Pari
Passu Deed (including, without limitation, the Trustee's right to give all
notices and consent to all waivers or amendments hereof, to enforce the
performance of the Pledgor's obligations hereunder and to exercise any remedies
given to the Trustee hereunder).
11.14 Termination of Existing Pledge Agreement; Consent; Release.
(a) Upon the acquisition by the Pledgor of legal and beneficial ownership of the
Shares, this Agreement shall cancel and supersede the Stock Pledge Agreement,
dated as of June 27, 1996, between CCLDC and the Trustee;
(b) The Trustee hereby consents to (i) the transfer of the Shares
from CCLDC to the Pledgor and (ii) the transfer (the "Issuer Repurchase") of
1,026,200 Shares (the "Repurchased Shares") from the Pledgor to the Issuer
pursuant to the Stock Option Agreement, dated as of May 9, 1996, among the
Issuer, CCLDC and Consolidated Press International Limited, as assigned to the
Pledgor by an assignment dated June 5, 1997, for an aggregate purchase price of
US $21,381,928.
(c) Effective upon the consummation of the Issuer Repurchase, the
Trustee hereby releases the Repurchased Shares from the pledge and security
interest created pursuant to this Agreement.
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11.15 GOVERNING LAW. THIS AGREEMENT AND (UNLESS OTHERWISE
EXPRESSLY PROVIDED) ALL AMENDMENTS AND SUPPLEMENTS TO, AND ALL CONSENTS AND
WAIVERS PURSUANT TO, THIS AGREEMENT WILL IN ALL RESPECTS BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW
YORK WITHOUT REFERENCE TO PRINCIPLES OF CONFLICTS OF LAW, INCLUDING ALL MATTERS
OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered by their representative officers thereunto
duly authorized as of the date first above written.
CONPRESS INTERNATIONAL
(NETHERLANDS ANTILLES) N.V.
By \s\ P.G. Beer
----------------------------------
Name: P.G. Beer
Title: Director
WESTPAC CUSTODIAN
NOMINEES LIMITED,
as Trustee
By \s\ Sarah J. Ross-Smith
----------------------------------
Name: Sarah J. Ross-Smith
Title: Attorney under Power
of Attorney, dated
June 11, 1997
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Schedule I
21,200,000 shares of common stock, par value $.01 per share, of
Valassis Communications, Inc., represented by stock certificate no. VC 20950.
<PAGE>
<PAGE>
================================================================================
STOCK PLEDGE AGREEMENT
Between
CONPRESS INTERNATIONAL (NETHERLANDS ANTILLES) N.V.,
as Pledgor,
and
WESTPAC CUSTODIAN NOMINEES LIMITED,
as Trustee
Dated as of June 11, 1997
Securing indebtedness in connection with
Syndicated Bill Facility Agreement, dated
March 25, 1994, among Consolidated Press
(Finance) Limited, the Trustee and the Guarantors,
Agent and Participants named therein
================================================================================
<PAGE>
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
DEFINITIONS. ................................................................ 3
SECTION 2. SECURITY FOR OBLIGATIONS. ....................................... 5
SECTION 3. PLEDGE OF SHARES, ETC.. ......................................... 6
SECTION 4. REPRESENTATIONS AND WARRANTIES. ................................. 6
SECTION 5. VOTING RIGHTS, DIVIDENDS AND OTHER DISTRIBUTIONS, ETC.. .......... 8
5.1 Prior to Event of Default or Potential Event of Default. .......... 8
5.2 After Event of Default or Potential Event of Default. ............. 8
SECTION 6. COVENANTS OF PLEDGOR. ........................................... 10
6.1 Sale of Collateral, Etc.. ........................................ 10
6.2 Delivery of Stock Certificates, Etc.. ............................ 10
6.3 Other Distributions. ............................................. 10
6.4 Records; Location of Records; Inspection. ........................ 11
6.5 Costs. ........................................................... 11
6.6 Priority of Security Interest; Further
Assurances. ...................................................... 11
SECTION 7. RIGHTS OF THE TRUSTEE AND THE LENDERS 12
7.1 No Obligations or Liability to Pledgor. ........................... 12
7.2 Right of Trustee to Perform Pledgor's Covenants, Etc. ............. 12
7.3 Additional Security. .............................................. 13
7.4 Release of the Pledge and Security Interest Created Hereby. ....... 13
SECTION 8. REMEDIES AND ENFORCEMENT. ....................................... 14
8.1 Remedies in Case of an Event of Default. .......................... 14
</TABLE>
<PAGE>
<PAGE>
<TABLE>
<S> <C>
8.2 Application of Proceeds Following an Event of Default. ........... 16
8.3 Purchase of Collateral by Trustee and Lenders. ................... 16
8.4 Purchaser to Acquire Good Title. ................................. 17
8.5 Sale of Pledged Stock Without Registration. ...................... 17
8.6 Appointment as Attorney-in-Fact. ................................. 18
8.7 Trustee's Right to Enforce Claims. ............................... 18
8.8 No Waiver; Cumulative Remedies. .................................. 19
8.9 Restoration of Rights and Remedies; Reinstatement. ............... 19
SECTION 9. PLEDGOR'S OBLIGATIONS NOT AFFECTED. ............................. 20
SECTION 10. THE TRUSTEE. ................................................... 20
SECTION 11. MISCELLANEOUS. ................................................. 21
11.1 Amendments, Etc. ................................................. 21
11.2 Survival of Agreements, Representations and Warranties. .......... 21
11.3 Successors and Assigns. .......................................... 22
11.4 Entire Agreement. ................................................ 22
11.5 Severability. .................................................... 22
11.6 Waiver of Jury Trial. ............................................ 22
11.7 Agreement May Constitute Financing Statement. .................... 23
11.8 Notices. ......................................................... 23
11.9 Submission to Jurisdiction; Waiver of Immunity;
Agent for Service of Process. .................................... 23
11.10 Currency Equivalent. ............................................ 24
11.11 Judgment. ....................................................... 24
11.12 Miscellaneous. .................................................. 25
11.13 Pari Passu Deed. ................................................ 25
11.14 Effective Time; Consent. ........................................ 25
11.15 Governing Law. .................................................. 26
</TABLE>
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STOCK PLEDGE AGREEMENT, dated as of June 11, 1997, between
CONPRESS INTERNATIONAL (NETHERLANDS ANTILLES) N.V., a company organized and
existing under the laws of the Netherlands Antilles ("Pledgor") and WESTPAC
CUSTODIAN NOMINEES LIMITED, ACN 002 861 565, a corporation organized and
existing under the laws of New South Wales, Australia, as trustee (the
"Trustee") acting on behalf of the Agent and the Lenders (as both terms are
defined below) under the Facility Agreement referred to in Paragraph A of the
Recitals.
R E C I T A L S
A. Pursuant to the Syndicated Bill Facility Agreement, dated
March 25, 1994 (as amended, modified or supplemented from time to time in
accordance with the provisions thereof, the "Facility Agreement"), among
Consolidated Press (Finance) Limited, as borrower (the "Borrower"), the
corporations listed on Schedule 1 thereto, as guarantors (the "Guarantors"),
Westpac Custodian Nominees Limited, Australia and New Zealand Banking Group
Limited, as agent (the "Agent") and the financial institutions listed on
Schedule 2 thereto (the "Lenders"), the Lenders have agreed to provide certain
financial accommodations to the Borrower.
B. Pursuant to the Accession Deed, dated the date hereof,
executed by Pledgor (the "Accession Deed"), Pledgor has guaranteed, among other
things, the prompt and timely payment and performance of the Borrower under the
Facility Agreement.
C. Pledgor is the purchaser from Conpress Cayman, LDC, a Company
Limited by Shares organized and existing under the laws of the Cayman Islands
("CCLDC"), of 21,200,000 shares of common stock of Valassis Communications,
Inc., a Delaware corporation (the "Issuer") as described in Schedule I attached
hereto (the "Shares").
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D. The Pledgor is concurrently pledging the Collateral (as
hereinafter defined) to Westpac Custodian Nominees Limited (the "Second
Pledgee") acting as trustee for certain lenders (the "Second Lenders") to secure
certain indebtedness and related obligations of Kerry Francis Bullmore Packer
(the "Second Borrower"), to the Second Lenders as well as the guaranty (the
"Second Guaranty") of such indebtedness, as well as indebtedness arising under
the Accession Deed, by the Pledgor (such indebtedness and related obligations
and the obligations of the Pledgor under the Second Guaranty, collectively, the
"Second Secured Obligations").
E. The Pledgor is required to execute and deliver this Agreement
to the Trustee as a condition precedent to the Lenders' obligations to provide,
or continue to provide, financial accommodation under the Facility Agreement.
F. The Second Pledgee and the Trustee have entered into a Pari
Passu Deed, dated June 27, 1996 (as amended, modified or supplemented from time
to time in accordance with the terms thereof, the "Pari Passu Deed") among
Consolidated Press Holdings Limited ("Holdings"), the Pledgor, the Trustee, the
Second Pledgee and certain other Persons pursuant to which the Second Pledgee
has agreed, among other things, to hold the Collateral on a pari passu basis as
collateral to secure, respectively, the obligations of the Second Borrower and
Pledgor to the Second Lenders and the obligations of the Borrower and the
Pledgor to the Lenders.
NOW, THEREFORE, to induce the Lenders to provide, or continue to
provide, certain financial accommodations to the Borrower, and for other good
and valuable consideration, the receipt and sufficiency or which is hereby
acknowledged, Pledgor hereby agrees with the Trustee for the benefit of the
Lenders as follows:
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SECTION 1. CERTAIN DEFINITIONS.
Capitalized terms used herein without other definition have the
meanings assigned thereto in the Facility Agreement. The following capitalized
terms are used herein with the respective meanings set forth below.
ACCESSION DEED: the meaning given in Paragraph B of the Recitals.
AGENT: the meaning given in Paragraph A to the Recitals.
BORROWER: the meaning given in Paragraph A of the Recitals.
CAPITAL STOCK: the Shares and all other capital stock or other
equity securities of any class of the Issuer.
CCLDC: the meaning given in Paragraph C of the Recitals.
COLLATERAL: the meaning given in the first paragraph of Section
3.
DOLLARS: dollars of the United States of America.
EQUITABLE MORTGAGE: the Equitable Mortgage of Shares, dated
January 13, 1995, between Westpac Custodian Nominees Limited and the
corporations named in Schedule 1 thereto, as amended, modified or supplemented
from time to time in accordance with the terms thereof.
FACILITY AGREEMENT: the meaning given in Paragraph A of the
Recitals.
GUARANTY: the guarantee and indemnity provided by Pledgor under
Sections 11 and 12 of the Facility Agreement.
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HOLDINGS: the meaning given in Paragraph F of the Recitals.
ISSUER: the meaning given in Paragraph C of the Recitals.
LENDERS: the meaning given in Paragraph A to the Recitals.
NYUCC: the Uniform Commercial Code of the State of New York.
OTHER CURRENCY: the meaning given in Section 11.11.
PARI PASSU DEED: the meaning given in Paragraph F to the
Recitals.
PERMITTED SECURITY INTEREST: means the liens and security
interests created by the First Equitable Mortgage of Shares and the Second
Equitable Mortgage of Shares (each as defined in the Pari Passu Deed).
PERSON: means any individual, corporation, partnership, business
trust, joint venture, association, joint stock company, trust, unincorporated
organization of government or any agency or political subdivision thereof.
PLEDGED STOCK: the Shares and all other securities constituting
part of the Collateral.
PLEDGOR: the meaning provided in the introductory paragraph to
this Agreement.
SECOND BORROWER: the meaning given in Paragraph D of the
Recitals.
SECOND GUARANTY: the meaning given in Paragraph D of the
Recitals.
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SECOND LENDERS: the meaning given in Paragraph D of the Recitals.
SECOND PLEDGEE: the meaning given in Paragraph D of the Recitals.
SECOND SECURED OBLIGATIONS: the meaning given in Paragraph D of
the Recitals.
SECURED OBLIGATIONS: the meaning given in Section 2.
SHARES: the meaning given in Paragraph C of the Recitals.
TRUSTEE: the meaning provided in the introductory paragraph to
this Agreement.
SECTION 2. SECURITY FOR OBLIGATIONS.
This Agreement secures, and the Collateral is security for, the
prompt payment in full when due, whether at stated maturity, by acceleration or
otherwise, and performance of all obligations of Pledgor to the Trustee, the
Agent and the Lenders under the Guaranty and this Agreement and all obligations
of the Borrower to the Trustee, the Agent and the Lenders under the Facility
Agreement and the other Transaction Documents, whether now existing or hereafter
incurred (collectively, the "Secured Obligations"). The term "Secured
Obligations" includes, without limitation, all interest (including, without
limitation, interest accruing after the date of any filing by the Borrower or
the Pledgor of any petition in bankruptcy or the commencement of any bankruptcy,
insolvency or similar proceeding with respect to the Borrower or the Pledgor),
charges, expenses, fees, attorneys' fees and other sums required to be paid by
the Pledgor or the Borrower under the Facility Agreement or any of the other
Transaction Documents.
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SECTION 3. PLEDGE OF SHARES, ETC.
As security for the prompt payment and performance of the Secured
Obligations when due (whether at stated maturity, by acceleration or otherwise),
Pledgor hereby conveys, assigns, grants, hypothecates, mortgages, pledges,
transfers and delivers to the Trustee, and hereby grants to the Trustee a lien
and charge upon, and a security interest in, all the following property, whether
now owned or hereafter acquired and whether now or in the future existing
(collectively, the "Collateral"):
(a) the Shares;
(b) all dividends, instruments, cash and other property or
rights of any kind at any time received, receivable or otherwise
distributed or distributable with respect to the Shares (including,
without limitation, in connection with a reorganization,
reclassification, consolidation, merger, subdivision or similar
transaction involving the Issuer) except as provided for herein;
(c) all certificates or other writings representing or evidencing
any of the foregoing;
(d) all proceeds of any of the property described in clauses (a)
through (c) above; and
(e) all books, correspondence, credit files, electronic data,
records, invoices and other papers and documents relating to any of the
foregoing.
SECTION 4. REPRESENTATIONS AND WARRANTIES.
Pledgor represents and warrants to the Trustee and each Lender as
follows:
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(a) Pledgor is a corporation duly organized, validly existing and
in good standing under the laws of the Netherlands Antilles and has all
requisite corporate power and authority to enter into and carry out the
terms of this Agreement.
(b) The execution, delivery and performance of this Agreement
will not result in any violation of or be in conflict with or constitute
a default under any term of Pledgor's certificate of incorporation or
by-laws or any agreement or instrument to which Pledgor is a party or by
which it is bound or any term of any applicable law, ordinance, rule or
regulation of any governmental authority or any term of any applicable
order, judgment or decree of any court, arbitrator or governmental
authority.
(c) No consent, approval or authorization of, or declaration or
filing with, any Person is required for the valid execution, delivery
and performance of this Agreement.
(d) This Agreement has been duly authorized, executed and
delivered by Pledgor and constitutes its legal, valid and binding
obligation, enforceable against Pledgor in accordance with its terms,
except to the extent that such enforcement may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws of
general application relating to or affecting the rights and remedies of
creditors, and by general equitable principles.
(e) Pledgor is the legal and beneficial owner of the Shares, free
and clear of any security interest except for the security interest
created by this Agreement, the Equitable Mortgage and the Permitted
Security Interests.
(f) The Shares have been duly authorized, validly issued and are
fully paid and non-assessable.
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(g) Upon delivery to the Trustee or a Person (other than the
Pledgor) acting as agent for the Trustee of the certificate or
certificates evidencing the Shares, the security interest granted
pursuant to this Agreement will constitute a valid perfected first
priority security interest in the Shares, enforceable as such against
all creditors of Pledgor and any Persons purporting to purchase any
Shares from Pledgor.
SECTION 5. VOTING RIGHTS, DIVIDENDS AND OTHER
DISTRIBUTIONS, ETC.
5.1 Prior to Event of Default or Potential Event of Default.
Unless an Event of Default or a Potential Event of Default has occurred and is
continuing, Pledgor will remain entitled to exercise any and all voting and
other consensual rights pertaining to the Pledged Stock and to receive, retain
and use cash dividends paid in respect of the Pledged Stock (it being understood
that, so long as no Event of Default or Potential Event has occurred and is
continuing, all such cash dividends shall be released from the pledge and
security interest granted to the Trustee hereunder from and after the date of
such payment).
5.2 After Event of Default or Potential Event of Default. For
so long as an Event of Default or Potential Event of Default is continuing, (i)
Pledgor may not exercise any such voting or other consensual rights without the
prior written consent of the Trustee (which consent shall not be unreasonably
withheld in the case of a Potential Event of Default), and (ii) the right, if
any, of Pledgor to receive cash dividends in respect of the Pledged Stock will
cease (unless the Trustee shall have consented to the Pledgor's retention of
such cash dividends, which consent shall not be unreasonably withheld in the
case of a Potential Event of Default) and all such dividends must be paid
directly to the Trustee (or if received by Pledgor will be deemed held in trust
by Pledgor for the benefit of, and must be turned over immediately by Pledgor
to, the Trustee) and thereafter will
8
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be held and disposed of by the Trustee as part of the Collateral. If an Event of
Default or a Potential Event of Default is continuing and the Trustee has not
consented to the Pledgor's continued exercise of voting or other consensual
rights as set forth in the preceding sentence, the Trustee may elect to exercise
voting and other consensual rights hereunder by giving notice of such election
to the Pledgor. Thereafter, all rights of Pledgor to exercise the voting and
other consensual rights which Pledgor would otherwise be entitled to exercise
pursuant to Section 5.1 will cease, all such rights will thereupon become vested
in the Trustee, who during the continuance of such Potential Event of Default or
Event of Default will have (directly or through its nominee) the sole right to
exercise such voting and other consensual rights, including, without limitation,
(A) all voting, corporate and other rights pertaining to any of the Pledged
Stock, (B) all rights to give consents, waivers and ratifications in respect
thereof and (C) any and all rights of conversion, exchange, subscription and any
other rights, privileges or options pertaining to any of the Pledged Stock as if
it were the absolute owner thereof, and in connection therewith, the right to
deposit and deliver any and all of the Pledged Stock with any committee,
depositary, transfer agent, registrar or other designated agency upon such terms
and conditions as it may determine, all without liability except to account for
property actually received by it (the Pledgor hereby irrevocably constituting
and appointing the Trustee the proxy and attorney-in-fact of Pledgor, with full
power of substitution, to do or take any of the above actions). The Trustee will
have no duty to Pledgor to exercise any such right, privilege or option and will
not be responsible for any failure to do so or delay in so doing. In order to
permit the Trustee to exercise the voting and other consensual rights which it
may be entitled to exercise pursuant to this Section 5.2, and to receive all
dividends and distributions which it may be entitled to receive under this
Section 5.2, the Pledgor will, upon written notice from the Trustee, from time
to time execute and deliver to the
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Trustee appropriate proxies, dividend payment orders and other instruments as
the Trustee may reasonably request.
SECTION 6. COVENANTS OF PLEDGOR.
6.1 Sale of Collateral, Etc. Pledgor will not (i) sell, assign,
transfer, convey, or otherwise dispose of, or grant any option 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 and security interest
created by this Agreement, the Equitable Mortgage and the Permitted Security
Interests.
6.2 Delivery of Stock Certificates, Etc. Pledgor will
immediately deliver to the Trustee all certificates or other writings
representing or evidencing any of the Shares and any other "securities" or
"instruments" (as such terms are defined in the NYUCC) included in the
Collateral at any time acquired or received by Pledgor, directly or indirectly,
either in suitable form for transfer by delivery, or issued in the name of
Pledgor and accompanied by stock powers or other appropriate instruments of
transfer or assignment, duly executed by Pledgor in blank and undated, and in
either case having attached thereto all requisite federal or state stock
transfer tax stamps, all in form and substance satisfactory to the Trustee.
6.3 Other Distributions. Except for cash dividends permitted to
be paid to Pledgor pursuant to Section 5.1, Pledgor will cause all dividends and
distributions of any kind on the Pledged Stock (including any sums paid upon or
in respect of the Pledged Stock upon the liquidation or dissolution of the
Issuer thereof or upon the recapitalization or reclassification of the capital
of the Issuer thereof or upon the reorganization of the Issuer thereof) to be
paid directly to the Trustee (and if any such dividends or distributions are
received by Pledgor, Pledgor will hold them in trust for the benefit of, and
will immediately turn them over to, the Trustee) and the Trustee will hold and
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dispose of all such dividends and distributions as part of the Collateral.
6.4 Records; Location of Records; Inspection. Pledgor will keep
full and accurate books and records relating to the Pledged Collateral, and
stamp or otherwise mark such books and records in such manner as is required in
order to reflect the pledge and security interest granted pursuant hereto.
Pledgor will permit representatives of the Trustee at any time upon reasonable
advance notice to inspect and make abstracts from its books and records
pertaining to the Collateral and to discuss matters relating to the Collateral
with officers of Pledgor.
6.5 Costs. Pledgor indemnifies the Trustee against, and shall
pay the Trustee on demand the amount of, all losses, liabilities, costs and
expenses referred to in Section 16.3 of the Facility Agreement in respect of
this Agreement.
6.6 Priority of Security Interest; Further Assurances. (a)
Pledgor will at all times cause the security interest granted pursuant to this
Agreement to constitute a valid perfected first priority security interest in
the Collateral subject only to the Permitted Security Interests, enforceable as
such against all creditors of Pledgor and any Persons purporting to purchase any
Collateral from Pledgor.
(b) Pledgor will at any time and from time to time, at its own
expense, promptly execute and deliver all further instruments and documents, and
take all further actions, as may be necessary or desirable, or that the Trustee
or any Lender may reasonably request, in order to (i) grant more effectively a
security interest in favor of the Trustee in all or any portion of the
Collateral, (ii) maintain, preserve, or perfect the security interest and lien
created or purported to be created by this Agreement and the first priority
status of such security interest and lien, (iii) preserve and defend against any
Person Pledgor's title to the Collateral and the rights purported
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to be granted therein by this Agreement, (iv) enable the Trustee and the Lenders
to exercise and enforce their rights and remedies hereunder, or (v) carry out
more effectively the purposes of this Agreement.
SECTION 7. RIGHTS OF THE TRUSTEE AND THE LENDERS.
7.1 No Obligations or Liability to Pledgor. The rights and
powers of the Trustee hereunder are not contingent upon the pursuit by the
Trustee of any right or remedy against Pledgor or against any other Person which
may be or become liable in respect of any of the Secured Obligations or against
any other collateral security or guarantee therefor or right of offset with
respect thereto, but are solely to protect its interest in the Collateral.
Neither the Trustee nor any Lender nor any Person acting on their behalf will be
liable for any failure to demand, collect or realize upon all or any part of the
Collateral or for any delay in doing so, nor is the Trustee under any obligation
to sell or otherwise dispose of any Collateral upon the request of Pledgor or
any other Person or to take any other action whatsoever with regard to the
Collateral or any part thereof. No action or inaction on the part of the Trustee
hereunder or under any of the other Transaction Documents will release Pledgor
from any of its obligations hereunder or under any of the other Transaction
Documents, or constitute an assumption of any such obligations on the part of
the Trustee, or cause the Trustee to become subject to any obligation or
liability to Pledgor. The Trustee has no obligation to perform any of the
obligations or duties of Pledgor as a shareholder of the Issuer.
7.2 Right of Trustee to Perform Pledgor's Covenants, Etc. If
Pledgor fails to make any payment or to perform any agreement required to be
made or performed hereunder, the Trustee may (but need not) at any time
thereafter make such payment or perform such act, or otherwise cause such
payment or performance. No such action will create any liability to Pledgor on
the part of the Trustee. All
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amounts so paid by the Trustee and all costs and expenses (including, without
limitation, attorneys' fees and expenses) incurred by the Trustee in any such
performance shall accrue interest from the date paid or disbursed until
reimbursed to the Trustee in full by or on behalf of Pledgor at the rate
established in Section 21 of the Facility Agreement. All such amounts shall
constitute additional indebtedness of the Pledgor secured hereunder and shall be
payable on demand.
7.3 Additional Security. Without notice to or consent of
Pledgor and without impairment of the security interest and rights granted
pursuant to this Agreement, the Trustee or the Lenders may accept, from the
Borrower or from any other Person or Persons, additional security for the
Secured Obligations. Neither the giving of this Agreement nor the acceptance of
any such additional security will prevent the Trustee or the Lenders from
resorting, first to such additional security, or, first to the security created
by this Agreement, in either case without affecting the Trustee's security
interest and rights granted pursuant to this Agreement.
7.4 Release of the Pledge and Security Interest Created Hereby.
Subject to the Pari Passu Deed and the rights of the Second Pledgee, upon
payment in full of the Secured Obligations and the termination of the Facility
Agreement, the Trustee will, upon the written request of Pledgor, return to the
Pledgor all Collateral held by the Trustee and if the Pledgor so requests,
execute and deliver to, or as directed in writing by, the Pledgor an appropriate
instrument (in due form for recording or filing) sufficient to release from the
pledge and security interest created hereby the Collateral and all other
property subject thereto.
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SECTION 8. REMEDIES AND ENFORCEMENT.
8.1 Remedies in Case of an Event of Default. If an Event of
Default has occurred and is continuing, then in addition to the actions referred
to in Section 5.2 the Trustee may take any or all of the following actions,
without demand of performance or other demand, advertisement or notice of any
kind to or upon Pledgor or any other Person (except as specified in Section
8.1(b)) all and each of which are hereby expressly waived by Pledgor:
(a) The Trustee may, in its own name or at its sole option in the
name of Pledgor, exercise any or all of the rights, powers and
privileges of, and pursue any or all of the remedies accorded to,
Pledgor under the Collateral and may exclude Pledgor and all Persons
claiming by, through or under Pledgor wholly or partly therefrom,
including in such rights, privileges and remedies, but without
limitation, all rights of Pledgor to demand, receive, sue for,
compromise and settle all payments in respect of the Collateral, and in
connection therewith to exercise all rights and remedies thereunder
which Pledgor could enforce if this Agreement had not been made.
(b) The Trustee may forthwith collect, recover, receive,
appropriate and realize upon the Collateral, or any part thereof, and/or
may forthwith sell, assign, give an option or options to purchase,
contract to sell or otherwise dispose of and deliver the Collateral, or
any part thereof, in one or more parcels at public or private sale or
sales, at any exchange, broker's board or at any of the Trustee's
offices or elsewhere upon such terms and conditions as it may deem
advisable and at such prices as it may deem best, for cash or on credit
or for future delivery without assumption of any credit risk. The
Trustee need not make any sale of Collateral even if notice thereof has
been given, may reject any and all bids that in its commercially
reasonable discretion it shall deem inadequate, and may
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adjourn any public or private sale. Pledgor hereby acknowledges that the
Collateral is of a type that could decline speedily in value and is also
of a type customarily sold on a recognized market, in each case within
the meaning of Section 9-504 of the NYUCC as in effect in any applicable
jurisdiction, and that the Trustee need not give any notice to Pledgor
prior to any sale of the Collateral at any exchange, broker's board or
in any other recognized market. Without limiting the foregoing, Pledgor
agrees that the Trustee need not give more than 10 days notice of the
time and place of any public sale or of the time after which a private
sale or other intended disposition is to take place and that such notice
is reasonable notification of such matters, and waives all other demands
or notices of any kind. Any such disposition which shall be a private
sale or other private proceedings permitted by the requirements of
applicable law shall be made only after written notice to Pledgor
specifying the time at which such disposition is to be made and the
intended sale price or other consideration therefor.
(c) The Trustee may, as a matter of right and without notice to
Pledgor or any Person claiming by, through or under Pledgor, cause the
appointment of a receiver for all or any part of the Collateral.
(d) In addition to all other rights and remedies granted to it in
this Agreement and in any other instrument or agreement securing,
evidencing or relating to any of the Secured Obligations, the Trustee
will have and may exercise with respect to any or all of the Collateral
all of the rights and remedies of a secured party under the NYUCC.
(e) The Trustee may, without the consent of the Pledgor, cause
any or all of the Pledged Stock to be registered in the name of the
Trustee or its nominee.
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Pledgor consents to and ratifies any action which the Trustee may
take to enforce its rights under this Section 8.1 Pledgor waives to the full
extent permitted by law the benefit of all appraisement, valuation, stay,
extension, moratorium and redemption laws now or hereafter in force and all
rights of marshalling in the event of the sale of the Collateral or any part
thereof or any interest therein. Pledgor will execute and deliver such documents
as the Trustee deems advisable or necessary in order that any such sale or
disposition be made in compliance with applicable law.
Any sale or other disposition of the Collateral or any part
thereof or interest therein in the exercise of any remedy hereunder will
constitute a perpetual bar against Pledgor and any Persons claiming by, through
or under Pledgor. Upon any such sale or other disposition, the receipt of the
officer making the sale or other disposition or of the Trustee is a sufficient
discharge to the purchaser for the purchase money, and such purchaser will have
no duty to see to the application thereof.
8.2 Application of Proceeds Following an Event of Default. All
amounts held or collected by the Trustee as part of the Collateral (including,
without limitation, all amounts realized as a result of the exercise of any
rights and remedies hereunder) following the occurrence of any Event of Default
will be applied forthwith by the Trustee as provided in the Pari Passu Deed.
8.3 Purchase of Collateral by Trustee and Lenders. To the
extent permitted by applicable law, either the Trustee or any Lender may be a
purchaser of the Collateral or any part thereof or any interest therein at any
sale or other disposition hereunder and may apply against the purchase price the
indebtedness secured hereby owing to such purchaser, to the extent of such
purchaser's distributive share of the purchase price.
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8.4 Purchaser to Acquire Good Title. Any purchaser of the
Collateral at any sale or other disposition thereof pursuant to this Section 8
will, upon any such purchase, acquire good title to the Collateral so purchased
free of the lien and security interest created by this Agreement and free of all
rights of equity or redemption in Pledgor, which rights Pledgor hereby expressly
waives and releases to the full extent permitted by law, and Pledgor will
warrant and defend the title of such purchaser against all claims arising by,
through or under the Pledgor. Nevertheless, if so requested by the Trustee or
any such purchaser, Pledgor will ratify and confirm any exercise of remedies by
the Trustee hereunder by executing and delivering to the Trustee or such
purchaser all bills of sale, assignments, releases and other proper instruments
to effect such ratification and confirmation as may be designated in any such
request. In addition, Pledgor will do or cause to be done all such other acts
and things as may be reasonably necessary to make such exercise of remedies
valid and binding and in compliance with any and all applicable laws,
regulations, orders, writs, injunctions, decrees or awards of any and all
courts, arbitrators or governmental instrumentalities, domestic or foreign,
having jurisdiction over any such exercise, all at Pledgor's expense.
8.5 Sale of Pledged Stock Without Registration. Pledgor
recognizes that (i) the Trustee may be unable to effect a public sale of any or
all of the Pledged Stock by reason of the Securities Act of 1933, as amended
(the "Securities Act"), and applicable state or foreign securities laws or
otherwise, but may be compelled to resort to one or more private sales thereof
to a restricted group of purchasers who will be obliged to agree, among other
things, to acquire such securities for their own account for investment and not
with a view to the distribution or resale thereof and who otherwise satisfy the
requirements of any such applicable law, and (ii) any such private sale may
result in prices and other terms less favorable to the seller than if such sale
were a public sale. No such sale will be deemed to have been made in a
commercially unreasonable manner
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solely for the reason that it was made as a private sale rather than a public
sale, and the Trustee will be under no obligation to delay a sale of any of the
Pledged Stock for the period of time necessary to permit the issuer of such
securities to register such securities for public sale under the Securities Act,
or under applicable state securities laws, or otherwise comply with applicable
law, even if the Issuer would agree to do so and would be able to do so.
8.6 Appointment as Attorney-in-Fact. Pledgor hereby irrevocably
constitutes and appoints the Trustee, with full power of substitution, as
Pledgor's attorney-in-fact, with full irrevocable power and authority in the
place and stead of Pledgor and in the name of Pledgor or otherwise, from time to
time in the Trustee's discretion, to execute and deliver any and all bills of
sale, assignments or other instruments which the Trustee may deem necessary or
advisable in its exercise of any of the remedies hereunder, and to take any
other action to accomplish the purposes of this Agreement, including, without
limitation, to ask, demand, collect, sue for, recover, compound, receive and
give acquittance and receipt for moneys due and to become due under or in
connection with the Collateral, to receive, endorse, and collect any drafts or
other instruments, documents and chattel paper in connection therewith, and to
file any claims or take any action or institute any proceedings which the
Trustee may deem to be necessary or desirable for the collection thereof,
Pledgor hereby ratifying and confirming all that such attorney or any substitute
may lawfully do by virtue hereof. This power of attorney is a power coupled with
an interest and is irrevocable. The Trustee agrees that, except upon the
occurrence of an Event of Default and during the continuance thereof, it will
not exercise the power of attorney or any other rights granted to it pursuant to
this Section 8.6.
8.7 Trustee's Right to Enforce Claims. All rights of action and
claims under this Agreement may be prosecuted and enforced by the Trustee, and
any such proceeding instituted by the Trustee may be brought in its own
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name as trustee of an express trust. Any recovery of judgment in any such
proceeding will, after provision for the payment of the costs and expenses of
the sale or other realization upon the Collateral, be, subject to the Pari Passu
Deed, for the ratable benefit of the Lenders.
8.8 No Waiver; Cumulative Remedies. No action or inaction of
the Trustee will be deemed to waive any of the rights, powers or remedies of the
Trustee hereunder except pursuant to a writing, signed by the Trustee, and then
only to the extent expressly set forth therein. A waiver by the Trustee of any
right, power or remedy on any one occasion will not bar the exercise of any
right, power or remedy hereunder on any future occasion. No failure of the
Trustee to exercise nor delay of the Trustee in exercising any right, power or
remedy will preclude the exercise of any other right, power or remedy. If the
Trustee accepts payment of any amount secured hereby after its due date, it will
not thereby be deemed to have waived its right to require prompt payment when
due of all other amounts payable hereunder. Each right, power and remedy of the
Trustee provided for in this Agreement or now or hereafter existing at law or
equity or by statute or otherwise is cumulative and concurrent and is in
addition to every other such right, power or remedy of the Trustee, and the
exercise of any one or more of any such rights, powers or remedies with respect
to any of the Collateral will not preclude the simultaneous or later exercise by
the Trustee of any other right, power or remedy with respect to any other
Collateral.
8.9 Restoration of Rights and Remedies; Reinstatement. (a) If
the Trustee has instituted any proceeding to enforce any right, power or remedy
under this Agreement and such proceeding has been discontinued or abandoned for
any reason, with or without notice to Pledgor, or has been determined adversely
to the Trustee, then and in every such case Pledgor and the Trustee will be
restored to their former positions hereunder, and thereafter all rights, powers
and remedies of the Trustee will continue as though no such proceeding had been
instituted.
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(b) If the Trustee has applied any amount against the Secured
Obligations and, thereafter, all or any part of any payment previously applied
by the Trustee is required to be rescinded or returned on account of any
applicable bankruptcy, insolvency, reorganization or similar law affecting
creditors rights generally, the Pledgor's obligations hereunder shall be
reviewed and reinstated to the extent of such payment, as though such payment
had not been made.
SECTION 9. PLEDGOR'S OBLIGATIONS NOT AFFECTED.
The covenants and agreements of Pledgor set forth herein are
primary obligations of Pledgor. All such obligations are absolute and
unconditional, are not subject to any counterclaim, set-off, deduction,
diminution, abatement, recoupment, suspension, deferment, reduction or defense
(other than full and strict compliance by Pledgor with its obligations
hereunder) based upon any claim Pledgor, the Issuer, the Borrower or any other
Person may have against the Trustee, any Lender or any other Person. All such
obligations will remain in full force and effect without regard to, and will not
be released, discharged or in any way affected by, any unenforceability,
invalidity or other infirmity with respect to any Transaction Document, or any
other circumstance, condition or occurrence whatsoever, whether foreseeable or
unforeseeable and without regard to whether Pledgor, the Issuer or the Trustee
or any Lender shall have any knowledge or notice thereof.
SECTION 10. THE TRUSTEE.
The Trustee accepts the trust hereby created and agrees to
perform the same and to receive and disburse all monies received by it as
trustee hereunder in accordance with the terms hereof. The Trustee is entering
into this Agreement solely as trustee and not in its individual capacity (except
as expressly provided herein), and in no case whatsoever shall the Trustee be
personally liable for, or for any loss in respect of, this Agreement, or for any
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action or inaction of Pledgor or Lenders, as to which all interested parties
shall look solely to the Collateral and such other moneys or property as are
from time to time held by the Trustee as trustee hereunder, provided that the
Trustee shall be responsible in its individual capacity to the Lenders and to
Pledgor for its own willful misconduct or gross negligence. THE TRUSTEE MAKES
NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, (a) AS TO THE TITLE OR VALUE
OF THE COLLATERAL, OR ANY OTHER REPRESENTATION OR WARRANTY WITH RESPECT TO THE
COLLATERAL WHATSOEVER, (b) as to the validity or enforceability of this
Pledge Agreement or any other Transaction Document or (c) as to the occurrence
of any statement contained in any thereof.
SECTION 11. MISCELLANEOUS.
11.1 Amendments, Etc. Any amendment, modification or waiver of
any term or provision of this Agreement must be in writing and signed by the
Trustee and the Pledgor. Any such waiver will be effective only in the specific
instance and for the specific purpose for which it is given. Pledgor must
deliver an executed counterpart or a correct copy of any amendment, modification
or waiver effected pursuant to this Section 11.1 to each Lender promptly after
it has become effective.
11.2 Survival of Agreements, Representations and Warranties.
All agreements, representations and warranties contained in this Agreement, the
Facility Agreement or the other Transaction Documents to which Pledgor is a
party or made in writing by or on behalf of Pledgor in connection with the
transactions contemplated by this Agreement, the Facility Agreement or the other
Transaction Documents to which Pledgor is a party will survive the execution and
delivery of this Agreement, any investigation at any time made by or on behalf
of the Trustee or the Lenders, the making of any loan under the Facility
Agreement or the repayment thereof or thereunder. All statements contained in
any certificate or other instrument delivered by or on
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behalf of Pledgor pursuant to this Agreement or the other Transaction Documents
to which Pledgor is a party or in connection with the transactions contemplated
by this Agreement or the other Transaction Documents to which Pledgor is a party
are to be deemed representations and warranties of Pledgor under this Agreement.
11.3 Successors and Assigns. This Agreement is binding upon and
will inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto, whether so expressed or not, and, in particular,
inure to the benefit of and be enforceable by each Lender.
11.4 Entire Agreement. This Agreement, the Facility Agreement
and the other Transaction Documents to which Pledgor is a party embody the
entire agreement and understanding between Pledgor and the Trustee and the
Lenders with respect to the transaction referred to herein and supersede all
prior agreements and understandings, written or oral, relating to the pledge of
collateral to the Trustee to secure the obligations of the Pledgor under the
Facility Agreement.
11.5 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction is, as to such jurisdiction,
ineffective only to the extent made necessary by such prohibition or
unenforceability. Any such prohibition or unenforceability in any jurisdiction
will not invalidate or render unenforceable (i) the remaining provisions hereof
or (ii) such provision in any other jurisdiction.
11.6 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
IRREVOCABLY AND UNCONDITIONALLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LEGAL
OR EQUITABLE ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OF THE OTHER TRANSACTION DOCUMENTS OR ANY TRANSACTION
CONTEMPLATED HEREBY OR THEREBY OR THE SUBJECT MATTER OF ANY OF THE FOREGOING.
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11.7 Agreement May Constitute Financing Statement. Pledgor
consents to the filing of this Agreement or a photocopy thereof as a financing
statement under the Uniform Commercial Code as in effect in any jurisdiction in
which the Trustee may determine such filing to be necessary or desirable.
11.8 Notices. If any notice or other communication is required
or permitted to be given under any of the provisions of this Agreement to
Pledgor or the Trustee, such notice shall be given in the manner and to the
addresses provided in Section 22.3 of the Facility Agreement.
11.9 Submission to Jurisdiction; Waiver of Immunity; Agent for
Service of Process. For the purpose of assuring that the Trustee and the
Lenders can enforce their rights under this Agreement, the Pledgor, for itself
and its successors and assigns, hereby irrevocably (a) agrees that any legal or
equitable action, suit or proceeding against the Pledgor arising out of or
relating to this Agreement or any transaction contemplated hereby or the subject
matter of any of the foregoing may be instituted in any state or federal court
in the State of New York, (b) waives any objection which it may now or hereafter
have to the venue of any such action, suit or proceeding, (c) irrevocably
submits itself to the nonexclusive jurisdiction of any state or federal court of
competent jurisdiction in the State of New York for purposes of any such action,
suit or proceeding, and (d) irrevocably waives any immunity from jurisdiction to
which it might otherwise be entitled in any such action, suit or proceeding
which may be instituted in any state or federal court in the State of New York,
and irrevocably waives any immunity from the maintaining of an action against it
to enforce any judgment for money obtained in any such action, suit or
proceeding and, to the extent permitted by applicable law, any immunity from
execution. The Pledgor hereby designates and appoints CT Corporation System (or
any successor corporation), at its office at 1633 Broadway, New York, New York
10019, as its authorized agent to accept and
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acknowledge on its behalf service of any and all process which may be served in
any such action, suit or proceeding solely with respect to any matter as to
which it has submitted to jurisdiction as set forth in this Section 11.9, and
agrees that proper service upon such authorized agent shall be deemed in every
respect service of process upon the Pledgor or its successors or assigns, and,
to the extent permitted by applicable law, shall be taken and held to be valid
personal service upon it. Such designation and appointment shall be irrevocable.
The Pledgor represents and warrants that CT Corporation System has agreed to act
as such agent for service of process. The Pledgor will take all action,
including the filing of any and all documents and instruments, as may be
necessary to continue in full force and effect the designation and appointment
as such agent of CT Corporation System or any successor corporation or such
other corporation as shall be satisfactory to the Trustee and the Lenders, so
that the Pledgor shall at all times have an agent for service of process for the
above purposes in the County of New York, State of New York. Nothing contained
in this Section 11.9 shall be deemed to affect the right of the Trustee and the
Lenders to serve process in any other manner permitted by law or to commence
legal proceedings or otherwise proceed against the Pledgor in any jurisdiction.
11.10 Currency Equivalent. For purposes of the construction of
this Agreement, the equivalent in Dollars of an amount in any other currency
shall be determined at the rate of exchange quoted by Westpac Banking
Corporation, New York Branch, in New York City, at 9:00 A.M. (New York City
time) on the Business Day immediately preceding the date of determination, to
prime banks in New York City for the spot purchase in the New York foreign
exchange market of Dollars with such other currency.
11.11 Judgment. If for the purpose of obtaining judgment in any
court it is necessary for the Trustee or any Lender to convert a sum due
hereunder in Dollars into another currency (the "Other Currency"), the Pledgor
agrees,
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to the extent permitted by applicable law, that the rate of exchange used shall
be that at which in accordance with normal banking procedures the Trustee could
purchase the Dollars with the Other Currency on the Business Day preceding that
on which final judgment is given.
11.12 Miscellaneous. This Agreement may be executed in any
number of counterparts, each of which is an original, but all of which together
constitute but one instrument. Except as otherwise indicated, references herein
to any "Section" means a "Section" of this Agreement. The table of contents and
the section headings in this Agreement are for purposes of reference only and
shall not limit or define the meaning hereof.
11.13 Pari Passu Deed. The parties hereto acknowledge that so
long as any of the Second Secured Obligations remain outstanding, all of the
rights, duties, privileges and obligations of the Trustee hereunder shall be
exercised by either the Trustee or the Second Pledgee as provided in the Pari
Passu Deed (including, without limitation, the Trustee's right to give all
notices and consent to all waivers or amendments hereof, to enforce the
performance of the Pledgor's obligations hereunder and to exercise any remedies
given to the Trustee hereunder).
11.14 Termination of Existing Pledge Agreement; Consent; Release.
(a) Upon the acquisition by the Pledgor of legal and beneficial ownership of the
Shares, this Agreement shall cancel and supersede the Stock Pledge Agreement,
dated as of January 13, 1995, between CCLDC and the Trustee;
(b) The Trustee hereby consents to (i) the transfer of the Shares
from CCLDC to the Pledgor and (ii) the transfer (the "Issuer Repurchase") of
1,026,200 Shares (the "Repurchased Shares") from the Pledgor to the Issuer
pursuant to the Stock Option Agreement, dated as of May 9, 1996, among the
Issuer, CCLDC and Consolidated Press International, Limited, as assigned to the
Pledgor by an
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assignment dated June 5, 1997, for an aggregate purchase price of
US $21,381,928.
(c) Effective upon the consummation of the Issuer Repurchase, the
Trustee hereby releases the Repurchased Shares from the pledge and security
interest created jpursuant to this Agreement.
11.15 GOVERNING LAW. THIS AGREEMENT AND (UNLESS OTHERWISE
EXPRESSLY PROVIDED) ALL AMENDMENTS AND SUPPLEMENTS TO, AND ALL CONSENTS AND
WAIVERS PURSUANT TO, THIS AGREEMENT WILL IN ALL RESPECTS BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW
YORK WITHOUT REFERENCE TO PRINCIPLES OF CONFLICTS OF LAW, INCLUDING ALL MATTERS
OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered by their representative officers thereunto
duly authorized as of the date first above written.
CONPRESS INTERNATIONAL
(NETHERLANDS ANTILLES) N.V.
By \s\ P.G. Beer
__________________________________
Name: P.G. Beer
Title: Director
WESTPAC CUSTODIAN
NOMINEES LIMITED,
as Trustee
By \s\ Sarah J. Ross-Smith
__________________________________
Name: Sarah J. Ross-Smith
Title: Attorney under Power
of Attorney, dated
June 11, 1997
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Schedule I
21,200,000 shares of common stock, par value $.01 per share, of
Valassis Communications, Inc., represented by stock certificate no. VC 20950.
<PAGE>
