SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
____________________________________________________________________________
BARNES & NOBLE, INC.
____________________________________________________________________________
(Name of Issuer)
Class A Stock, $.001 par value
____________________________________________________________________________
(Title of Class and Securities)
067774109
____________________________________________________________________________
(CUSIP Number)
Leonard Riggio
Barnes & Noble, Inc.
122 Fifth Avenue
New York, New York 10011
Tel. No.: (212) 633-3300
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
_________________________________________________________________
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
March 4, 1997
_________________________________________________________________
(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 |__|
__
Check the following box if a fee is being paid with the statement |__|. (A
fee is not required if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such
class.) (See Rule 13d-7.)
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 (the "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).
<PAGE>
SCHEDULE 13D
CUSIP No. 067774109
-----------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
LEONARD RIGGIO
- -----------------------------------------------------------------
__
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |__|
__
(b) |__|
- -----------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------
4 SOURCE OF FUNDS*
BK
- -----------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED __
PURSUANT TO ITEMS 2(d) or 2(E) |__|
- -----------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
- -----------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF 7,671,751
SHARES --------------------------------------------------
8 SHARED VOTING POWER
BENEFICIALLY 720,000
OWNED BY --------------------------------------------------
9
EACH SOLE DISPOSITIVE POWER
7,671,751
REPORTING
PERSON --------------------------------------------------
10 SHARED DISPOSITIVE POWER
720,000
WITH
- -----------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,391,751
- -----------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES __
CERTAIN SHARES* |__|
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
24.8%
- -----------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
This Amendment No. 3 to Schedule 13D is being filed by Leonard Riggio in
connection with his purchase on March 4, 1997 of 1,200,000 shares of common
stock, par value $.001 per share, of Barnes & Noble, Inc., a Delaware
corporation. In accordance with Rule 101 of Regulation S-T, this Amendment
No. 3 amends and restates in its entirety the Schedule 13D of Mr. Riggio
dated October 12, 1993, as amended by Amendment No. 1 dated July 18, 1994 and
Amendment No. 2 dated November 9, 1995.
Item 1. Security and Issuer.
This statement relates to the common stock, par value $.001 per share
(the "Common Stock"), of Barnes & Noble, Inc., a Delaware corporation (the
"Company"), with its principal executive offices at 122 Fifth Avenue, New
York, New York 10011.
Item 2. Identity and Background.
(a) This statement is being filed by Leonard Riggio.
(b) Mr. Riggio's business address is 122 Fifth Avenue, New York, New
York 10011.
(c) Mr. Riggio is the Chairman of the Board and Chief Executive Officer
of the Company.
(d) and (e) During the last five years, Mr. Riggio has not been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to 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.
(f) Mr. Riggio is a citizen of the United States of America.
Item 3. Source and Amount of Funds or Other Consideration.
On March 4, 1997, Mr. Riggio purchased an aggregate of 1,200,000 shares
of Common Stock from Vendex International N.V., a corporation organized under
the laws of the Netherlands ("Vendex"), and its wholly owned subsidiary
Vendamerica B.V. ("Vendamerica"), for $34.00 per share in a private transaction.
The proceeds paid by Mr. Riggio to Vendex and Vendamerica were borrowed from
Morgan Guaranty Trust Company of New York ("Morgan Guaranty") pursuant to a
demand loan. The loan is secured by Mr. Riggio's pledge of the shares of
Common Stock that he directly owns, including the 1,200,000 shares purchased
from Vendex and Vendamerica.
Item 4. Purpose of Transaction.
Mr. Riggio is the founder of the Company and has been its Chairman,
Chief Executive Officer and principal stockholder since the Company's
inception in 1986. He has acquired the Common Stock as an investment.
(a)-(j) Mr. Riggio has no current plans or proposals with respect to
any of the items described in (a) through (j) of Item 4.
Item 5. Interest in Securities of the Issuer
(a) and (b) Mr. Riggio is the beneficial owner of 8,391,751 shares, or
24.8%, of the Common Stock, 659,375 shares of which are issuable upon the
exercise of stock options which are exercisable within 60 days after the date
of this Amendment. Mr. Riggio is the direct beneficial owner of 6,345,584
shares of Common Stock, including the shares issuable upon the exercise of
the aforementioned stock options, all of which shares Mr. Riggio has the sole
power to vote and dispose of. Mr. Riggio is the indirect beneficial owner of
1,326,167 shares of Common Stock registered in the name of Barnes & Noble
College Bookstores, Inc. ("B&N College"), a New York corporation of which Mr.
Riggio directly owns all of the voting securities. As the owner of all of
the voting securities of B&N College, Mr. Riggio has the sole power to direct
the vote and disposition of the 1,326,167 shares owned by B&N College.
Mr. Riggio is the indirect beneficial owner of 720,000 shares of Common
Stock as a co-trustee of The Riggio Foundation, a charitable trust.
Mr. Riggio shares the power to vote and dispose of such shares with his wife,
Louise Riggio, who is the other co-trustee of The Riggio Foundation.
(c) On March 4, 1997, Mr. Riggio purchased an aggregate of 1,200,000
shares of Common Stock from Vendex and Vendamerica for $34.00 per share in
a private transaction. On February 25, 1997, Mr. Riggio acquired an aggregate
of 86,100 shares of Common Stock in open market purchases on the New York Stock
Exchange made in accordance with Rule 10b-18 of the Act, at per share prices
(including customary broker's commissions) ranging from $30.85 to $31.10.
The weighted average per share price (including customary broker's commissions)
for such shares was approximately $31.03. Between January 17, 1997 and
January 22, 1997, Mr. Riggio acquired an aggregate of 123,300 shares of Common
Stock in open market purchases on the New York Stock Exchange made in accordance
with Rule 10b-18 of the Act, at per share prices (including customary broker's
commissions) ranging from $26.316 to $29.685. The weighted average per share
price (including customary broker's commissions) for such shares was
approximately $28.85.
(d) and (e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer
The Company, Mr. Riggio, B&N College and Vendex are parties to a
Securityholders Agreement, dated as of November 16, 1992 (the "Securityholders
Agreement"), which is attached as Exhibit 1 to Amendment No. 2 to this Schedule
13D ("Amendment No. 2") and is incorporated herein by reference. Although most
of the provisions of the Securityholders Agreement by their terms are no longer
applicable, Section 2.4 of the Securityholders Agreement provides Vendex and
certain transferees of Vendex with certain tag along sale rights in the event
that either Mr. Riggio or B&N College or certain of their transferees proposes
to transfer any shares of Common Stock other than pursuant to a public offering
or Rule 144 transaction.
On September 28, 1993, the Company issued to Mr. Riggio options to
purchase 324,667 shares of Common Stock at $20.25 per share and options to
purchase 334,708 shares of Common Stock at $27.00 per share pursuant to
Option Certificates attached as Exhibit 2 to Amendment No. 2 and incorporated
herein by reference (the "Option Certificates"). The options became effective
by their terms on October 26, 1993, and are fully vested.
The Company and Mr. Riggio are parties to a Registration Rights
Agreement dated October 20, 1994 (the "Registration Rights Agreement")
attached as Exhibit 3 to Amendment No. 2 and incorporated herein by
reference, pursuant to which Mr. Riggio has demand registration rights with
respect to 2,721,235 shares of Common Stock.
Pursuant to a letter agreement dated July 19, 1995 attached as Exhibit 4
to Amendment No. 2 and incorporated herein by reference (the "Riggio/Vendex
Letter Agreement"), Mr. Riggio agreed that, upon the request of Vendex or
Vendamerica, subject to fiduciary duties applicable to directors, he will
recommend to the Company's Board of Directors, and support and vote in favor
of, granting registration rights to Vendex or Vendamerica for up to 1,000,000
shares of Common Stock.
The proceeds paid by Mr. Riggio to Vendex and Vendamerica for his March
4, 1997 purchase of 1,200,000 shares of Common Stock were borrowed from
Morgan Guaranty pursuant to a demand loan. The loan is secured by Mr.
Riggio's pledge of the shares of Common Stock that he directly owns, including
the 1,200,000 shares purchased from Vendex and Vendamerica. The loan is part
of an advised line of credit of $100,000,000 in favor of Mr. Riggio and his
wife, of which approximately $90,000,000 in principal amount is currently
outstanding. The letter agreement, Demand Note and Pledge Agreements relating
to the aforementioned loan and line of credit are attached hereto as Exhibits
5 through 8 and are incorporated herein by reference.
Item 7. Material to be Filed as Exhibits
1. The Securityholders Agreement.
2. The Option Certificates.
3. The Registration Rights Agreement.
4. The Riggio/Vendex Letter Agreement.
5. Letter Agreement dated as of March 3, 1997 between Morgan Guaranty
and Mr. and Mrs. Riggio.
6. Demand Note dated as of March 3, 1997 from Mr. Riggio to Morgan
Guaranty.
7. Pledge Agreement dated as of March 3, 1997 between Mr. Riggio and
Morgan Guaranty.
8. Pledge Agreement dated as of March 3, 1997 between Mr. and Mrs.
Riggio and Morgan Guaranty.
Exhibits 1 through 4 listed above were previously filed with Amendment
No. 2 and have been omitted from this filing pursuant to Rule 13d-2(c) of the
Act.
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete
and accurate.
Dated: March 14, 1997
/s/Leonard Riggio
____________________________________
Leonard Riggio
March 3, 1997
Mr. and Mrs. Leonard Riggio
733 Park Avenue
17th Floor
New York, New York 10021
Dear Mr. and Mrs. Riggio:
Reference is made to the advised line of credit (the "Line of
Credit") in the amount of $100,000,000 that Morgan Guaranty Trust
Company of New York ("Morgan") has agreed to extend to you.
This is to confirm our agreement that:
- - Subject to its availability, the Line of Credit may be
utilized by your obtaining loans thereunder, each in
principal amount of at least $500,000.
- - You shall give Morgan notice not later than (i) 12:00 p.m.
(New York City time) on the date of each Domestic Loan and
(ii) the third business day (as defined in the note
evidencing loans under the Line of Credit) before each
Eurodollar Loan specifying (a) the date of such Loan, (b)
the principal amount of such Loan, (c) whether the Loan is
to be a Domestic Loan or a Eurodollar Loan and (d) if a Loan
is a Eurodollar Loan, the duration of the interest period
elected with regard to the loan (one, three, six or twelve
months).
- - Repayments of loans must be in the minimum amount of
$500,000.
- - So long as you shall be indebted to Morgan with regard to
any loans extended under the Line of Credit or the Line of
Credit shall be in existence:
- You shall maintain on deposit in your custody account
no. 89318 (the "Custody Account") at Morgan Guaranty
collateral acceptable to Morgan having a lending value,
as established by Morgan in its sole discretion, at
least equal to your outstanding obligations with regard
to the Line of Credit.
- You shall furnish to Morgan such information concerning
your financial condition as Morgan shall reasonably
request, including but not limited to financial
statements on an annual basis.
- You shall not create any indebtedness to other than
Morgan in addition to that shown on your financial
statement dated December 31, 1995 that you have
delivered to Morgan other than (i) $1,000,000 in
aggregate indebtedness from time to time outstanding
and (ii) indebtedness secured by a residential mortgage
not exceeding $7,000,000 in aggregate amount.
- Shares of Barnes & Noble, Inc. purchased using the
proceeds of the initial loan under the Line of Credit
shall be held in the Custody Account and shall be
registered for resale under the Securities Act of 1933
by not later than July 15, 1997.
- - Loans under the Line of Credit shall be subject to Morgan's
demand and the demand tenor thereof shall not be affected by
this letter. The Line of Credit is not a committed lending
facility and its availability shall be subject to Morgan's
discretion.
Please confirm your agreement with the contents of this letter by
signing the enclosed copy of this letter in the space below and
returning it to the undersigned.
Very truly yours,
Morgan Guaranty Trust Company
of New York
By: _________________________
Jeffrey Westcott,
Vice President
Agreed to:
________________________
LEONARD RIGGIO
________________________
LOUISE RIGGIO
DEMAND NOTE
U.S. $100,000,000 March 3, 1997
FOR VALUE RECEIVED, LEONARD RIGGIO and LOUISE RIGGIO
(collectively, the "Borrowers") promise to pay to the order of
MORGAN GUARANTY TRUST COMPANY OF NEW YORK (the "Bank") ON DEMAND
at its office at 60 Wall Street, New York, New York 10260-0060,
U.S.A., for the account of its Lending office (as hereinafter
defined), in lawful money of the United States of America in same
day funds (or in such funds as may from time to time become
customary for the settlement of international transactions in
U.S. dollars), the lesser of (i) U.S. $100,000,000 or (ii) the
then-outstanding principal amount of each loan (the "Loan" or
"Loans") made by the Bank from time to time to the Borrowers
hereunder. The Borrowers shall pay interest on the unpaid
principal amount of such Loan until maturity on the dates and at
a rate per annum as hereinafter set forth. As used herein,
"Lending Office" means, (i) with regard to Loans bearing interest
based on the Base Rate (as hereinafter defined) (collectively,
"Domestic Loans"), the office of the Bank located at 60 Wall
Street, New York, New York or such other office as the Bank may
designate, and (ii) with regard to Loans bearing interest based
on the Eurodollar Rate (as hereinafter defined) (collectively,
"Eurodollar Loans"), the Nassau (Bahamas) office of the Bank or
such other office as the Bank may designate.
Interest based on the Base Rate shall be computed on the
basis of a year of 365 days (or 366 days in a leap year) and paid
for actual days elapsed (including the first day but excluding
the last day). Interest based on the Eurodollar Rate shall be
computed on the basis of a year of 360 days and paid for the
actual number of days elapsed {including the first day but
excluding the last day),
Each Eurodollar Loan shall bear interest at a rate per annum
(the "Eurodollar Rate") equal to the Adjusted Eurodollar Rate (as
hereinafter defined) plus (i) 1 and 3/4% so long as the principal
amount of outstanding Loans hereunder shall be greater than
$50,000,000 and (ii) 1% at all other times {the "Eurodollar
Margin"), payable on the last day of the Interest Period
applicable thereto and, if such Interest Period is longer than
three months, at intervals of three months after the first day
thereof. The "Adjusted Eurodollar Rate" applicable to any
Interest Period (as hereinafter defined) means a rate per annum
equal to the quotient obtained (rounded upwards, if necessary, to
the next higher 1/100 of 1%) by dividing (i) the applicable
London Interbank Offered Rate by (ii) 1.00 minus the Eurodollar
Reserve Percentage. The "London Interbank Offered Rate"
applicable to any Interest Period means the rate per annum at
which deposits in U.S. dollars are offered to the Bank in the
London interbank market at approximately 11:00 a.m. (London time)
two business days prior to the first day of such Interest Period
in an amount approximately equal to the principal amount of the
Loan to which such Interest Period applies and for the period of
time comparable to such Interest Period. The "Eurodollar Reserve
Percentage" means for any day that percentage (expressed as a
decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a
member bank of the Federal Reserve System in New York City with
deposits exceeding five billion dollars in respect of
"Eurocurrency liabilities" (or in respect of any other category
of liabilities which includes deposits by reference to which the
interest rate on the Loans is determined or any category of
extensions of credit or other assets which includes loans by a
non-United states office of the Bank to United States residents)
The Adjusted Eurodollar Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurodollar
Reserve Percentage. As used herein, the term "Interest Period"
means the period beginning on the date of each Eurodollar Loan
and ending on the numerically corresponding day in the calendar
month one, three, six, or twelve months after such date:
provided, that if ah Interest Period would otherwise end on a day
which is not a business day it shall be extended to the next
succeeding business day unless such business day falls in the
next calendar month, in which case the Interest Period shall end
on the next preceding business day; provided, further, that if
the Bank shall not have received written notice to the contrary
from the Borrowers at least five business days prior to the end
of an Interest Period the Borrowers shall be deemed to have
requested to select an Interest Period with a duration equal to
that then ending. As used herein, the term "business day" means
any day on which dealings in U.S, dollar deposits are carried on
in the London interbank market and on which commercial banks are
open for domestic and foreign exchange business in London and New
York City. Notice by the Bank to the Borrowers of the rate of
interest so determined shall be binding and conclusive upon the
Borrowers in the absence of manifest error.
Each Domestic Loan shall bear interest payable on the last
day of each month at a rate per annum (the "Base Rate") for each
day equal to the higher of (i) the rate of interest publicly
announced by the Bank in New York City from time to time as its
Prime Rate (the "Prime Rate") and (ii) the sum of l/2 of 1% plus
the Federal Funds Rate (as defined below) for such day. "Federal
Funds Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged
by Federal funds brokers on such day, as published by the Federal
Reserve Bank of New York on the business day next succeeding such
day; provided that (i) if such day is not a business day, the
Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding business day as so published
on the next succeeding business day, and (ii) if no such rate is
so published on such next succeeding business day, the Federal
Funds Rate for such day shall be the average rate quoted to the
Bank on such day on such transactions as determined by the Bank.
The Borrowers shall pay interest on the unpaid principal
amount of each Loan after the maturity thereof and, to the extent
permitted by law, on accrued and unpaid interest until paid at a
rate per annum equal to the sum of 2% plus the Base Rate.
If after the date of this Note the adoption of, or any
change in, any applicable rule, executive order, decree,
regulation or interpretation is amended, modified, enacted or
promulgated by any government or governmental authority which (i)
changes the basis of taxation of payments to the Bank or the
Lending Office of the Bank extending a Eurodollar Loan (the
"Eurodollar Lending Office") in respect to the principal of and
interest on any Eurodollar Loan (except for changes in the rate
of taxation on the overall net income of the Bank by the United
States of America or the Eurodollar Lending Office of the Bank by
the jurisdiction in which such Lending Office is located), or
(ii) imposes, modifies or deems applicable any reserve, special
deposit or similar requirement against any of the assets of,
deposits with or for the account of, or credit extended by the
Bank's Eurodollar Lending Office, or (iii) imposes on the Bank
(or its Eurodollar Lending Office) or the London interbank market
any other conditions affecting any Loan, the Loans or this Note,
and the result of any of the foregoing is to increase the cost to
the Bank (or its Eurodollar Lending Office) of agreeing to make
or making, funding or maintaining any Loan evidenced by this Note
or would have the effect of reducing the rate of return on the
capital of the Bank of any entity controlling the Bank (its
"Parent") as a consequence of agreeing to make any Loan, or to
reduce the amount of any sum receivable by the Bank (or its
Eurodollar Lending Office) on this Note, then the Borrowers shall
pay to the Bank or its Parent upon demand such amount as will
compensate the Bank or its Parent for such additional cost or
reduction in return. A certificate of the Bank setting forth the
basis for the determination of any amount necessary to compensate
the Bank or its Parent as aforesaid shall be conclusive as to the
determination of such amount in the absence of manifest error.
If, after the date of this Note, the introduction of, or any
change in, any applicable law, rule or regulation or in the
interpretation or administration thereof by any governmental
authority charged with the interpretation or administration
thereof or compliance by the Bank (or its Eurodollar Lending
Office) with any request or directive (whether or not having the
force of law) of any such authority shall make it unlawful or
impossible for the Bank (or its Eurodollar Lending Office) to
make, maintain or fund its Eurodollar Loans, the Bank forthwith
shall so notify the Borrowers. Upon receipt of such notice, the
Borrowers shall prepay in full the then outstanding principal
amount of each Eurodollar Loan, together with accrued interest
thereon, on either (a) the last day of the Interest Period
applicable thereto if the Bank may lawfully continue to maintain
and fund such Loan to such day or (b) immediately if the Bank may
not lawfully continue to fund and maintain such Loan to such day.
Eurodollar Loans may not be repaid at the Borrowers' option
on a date other than the last day of an Interest Period. If,
however, the Borrowers make any payment of principal of any
Eurodollar Loan on any day other than the last day of the
Interest Period applicable thereto, the Borrowers shall reimburse
the Bank on demand for any loss or expense incurred by it as a
result of the timing of such payment, including (without
limitation) any loss incurred in obtaining, liquidating or
employing deposits from third parties, provided that the Bank
shall have delivered to the Borrowers a certificate as to the
amount of such loss, which certificate shall be conclusive in the
absence of manifest error.
Domestic Loans may be prepaid at any time without penalty or
premium.
The Borrowers hereby waive diligence, presentment, demand,
protest and notice of any kind whatsoever, The non-exercise by
the Bank of its rights hereunder in any particular instance shall
not constitute a waiver of any right in any subsequent instance.
The holder of this Note shall, and is hereby authorized by
the Borrowers to, endorse on the schedule forming a part hereof
appropriate notations evidencing the date and the amount of each
Loan made by the Bank, the date and amount of each payment of
principal, whether such Loan is a Domestic or Eurodollar Loan
and, in the case of Eurodollar Loans, the Eurodollar Rate
applicable thereto.
If this Note is not Paid in full when due the Borrowers
agree to pay all costs and expenses of collection, including
reasonable attorneys' fees.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAW OF THE STATE OF NEW YORK. The Borrowers hereby
submit to the nonexclusive jurisdiction of the United States
District Court for the Southern District of New York and of any
New York State Court sitting in New York City for purposes of all
legal, proceedings arising out of or relating to this Note or any
agreement received by the Bank in connection herewith. The
Borrowers irrevocably waive, to the fullest extent permitted by
law, any objection which the Borrowers may now or hereafter have
to the laying of the venue of any such proceeding brought in such
a court and any claim that any such proceeding brought in such a
court has been brought in inconvenient forum. The Borrowers
hereby irrevocably waive any and all right to trial by jury in
any legal proceeding arising out of or relating to this Note or
any agreement received by the Bank in connection herewith.
The obligations of the Borrowers hereunder shall be joint
and several.
______________________________
LEONARD RIGGIO
______________________________
LOUISE RIGGIO
<PAGE>
LOANS AND PAYMENTS OF PRINCIPAL
Amount Type Amount of
of of Principal Maturity Notation
Date Loan Loan Repaid Date* Made By
- ---- ------ ---- --------- -------- --------
*Subject to Prior Demand
PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of March 3, 1997 between LEONARD
RIGGIO (the "Pledgor") and MORGAN GUARANTY TRUST COMPANY OF NEW
YORK (the "Bank").
WHEREAS, the Bank may extend and has already extended loans
or other credit facilities or financial accommodations
(collectively, the "Loans") to or on behalf of the Pledgor from
time to time;
NOW, THEREFORE, to induce the Bank to extend the Loans and
to secure his obligations (collectively, the "Secured
Obligations") with regard thereto, and for other good
consideration, the receipt and adequacy of which are hereby
acknowledged, the Pledgor and the Bank agree as follows:
1. As collateral security for the performance of the
Secured Obligations, the Pledgor hereby pledges and assigns to
the Bank, and grants to the Bank a security interest in, those
securities identified in Exhibit A hereto, all proceeds and
products thereof and distributions thereon, and all other shares
of Barnes & Noble, Inc. from time to time maintained by him in
custody with the Bank (collectively, the "Collateral.
2. The Pledgor represents and warrants that: (i) all of
the Collateral is and will be validly and duly pledged to the
Bank in accordance with law, and agrees to defend the Bank's
right, title, lien and security interest in and to the Collateral
against the claims and demands of all persons whomsoever, (ii) he
has, and will have upon deposit with the Bank, title to all of
the Collateral, free and clear of all claims, mortgages, pledges,
liens, encumbrances and security interests of every nature
whatsoever, and that no consent or approval of any person, entity
or governmental or regulatory authority, or of any securities
exchange was or is necessary to the validity of this pledge,
(iii) the information set forth in Exhibit A is true and correct
and (iv) no liens, security interests or adverse claims other
than in favor of the Bank exist upon any of the Collateral.
3. The Pledgor will faithfully preserve and protect the
Bank's security interest in the Collateral and will do all such
acts and things and execute and deliver all such documents and
instruments, including without limitation further pledges,
assignments, financing statements and continuation statements, as
the Bank in its sole discretion may reasonably deem necessary or
advisable from time to time in order to preserve, protect and
perfect such security interest. The Pledgor hereby authorizes
the Bank to sign and file financing and continuation statements
without the signature of the Pledgor.
4. The Pledgor will not permit any liens, security
interests or adverse claims other than in favor of the Bank to
exist upon any of the Collateral and will not, without the prior
express written consent of the Bank, pledge any additional shares
of the Corporation (as defined in Exhibit A) to any person or
entity other than the Bank.
5. The Pledgor will not take any action that could in any
way limit or adversely affect the ability of the Bank to realize
upon its rights on the collateral.
6. The Pledgor agrees to notify the Bank:
(a) at least 72 hours prior to donating, or committing any
other act with respect to any securities of the same class (or
convertible into) shares of the Corporation which might render
the Collateral not salable; and
(b) immediately of any development or occurrence which to
his knowledge would render any of the Collateral not readily
saleable under Rules 144 or 145(d) or the Securities Act of 1933,
whichever is applicable.
7. If any time the Secured Obligations shall be in default
the Bank may cause all or any of the Collateral to be transferred
to or registered in its name or the name of its nominee or
nominees.
8. In the event the Secured Obligations shall be in
default (i) all dividends, interest and other distributions at
any time and from time to time declared or paid upon any of the
Collateral shall become part of the Collateral and (ii) the Bank
shall be entitled to exercise all voting power with respect to
the Collateral.
9. If any of the Secured Obligations shall not be
performed forthwith when due in accordance with their terms, the
Bank, without obligation to resort to other security, shall have
the right at any time and from time to time to sell, resell,
assign and deliver, in its discretion, all or any of the
Collateral, in one or more parcels at the same or different
times, and all right, title and interest, claim and demand
therein and right of redemption thereof, on any securities
exchange on which the Collateral or any of it may be listed, or
at public or private sale, for cash, upon credit or for future
delivery, and in connection therewith the Bank may grant options,
the Pledgor hereby waiving and releasing any and all equity or
right of redemption. If any of the Collateral is sold by the
Bank upon credit or for future delivery, the Bank shall not be
liable for the failure of the purchaser to purchase or pay for
the same and, in the event of any such failure, the Bank may
resell such Collateral. In no event shall the Pledgor be
credited with any part of the proceeds of sale of any Collateral
until cash payment thereof has actually been received by the
Bank. In addition, should any portion of the Collateral consist
of a time deposit or deposits with a financial institution, the
Bank may terminate such deposit or deposits prior to the maturity
thereof and any penalties payable in connection therewith shall
be for the sole account of the Pledgor.
10. No demand, advertisement or notice, all of which are
hereby expressly waived, shall be required in connection with any
sale or other disposition of any part of the Collateral which
threatens to decline speedily in value or which is of a type
customarily sold on a recognized market; otherwise the Bank shall
give the Pledgor at least five business days' prior notice of the
time and place of any public sale and of the time after which any
private sale or other disposition is to be made, which notice the
Pledgor agrees is reasonable, all other demands, advertisements
and notices being hereby waived. The Bank shall not be obligated
to make any sale of Collateral if it shall determine not to do
so, regardless of the fact that notice of sale may have been
given. The Bank may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned from
time to time by announcement at the time and place fixed for
sale, and such sale may, without further notice, be made at the
time and place to which the same was so adjourned. In the case
of all sales of Collateral, public or private, the Pledgor shall
pay all costs and expenses of every kind for sale or delivery,
including brokers' and attorneys' fees, and after deducting such
costs and expenses from the proceeds of sale, the Bank shall
apply any residue to the payment of principal, interest and other
amounts owed with regard to the Loans. The balance, if any,
remaining after payment in full of all such amounts shall be paid
to the Pledgor, subject to any duty of the Bank imposed by law to
the holder of any subordinate security interest in the Collateral
known to the Bank.
11. The Pledgor recognizes that the Bank may be unable to
effect a public sale of all or a part of the Collateral by reason
of certain prohibitions contained in the Securities Act of 1933,
as amended, as now or hereafter in effect, or in applicable Blue
Sky or other state securities laws, as now or hereafter in
effect, but may be compelled to resort to one or more private
sales to a restricted group of purchasers who will be obliged to
agree, among other things, to acquire such Collateral for their
own account, for investment and not with a view to the
distribution or resale thereof. The Pledgor agrees that private
sales so made may be at prices and other terms less favorable to
the seller than if such Collateral were sold at public sales, and
that the Bank has no obligation to delay sale of any such
Collateral for the period of time necessary to permit the issuer
of such Collateral, even if such issuer would agree, to register
such Collateral for public sale under such applicable securities
laws. The Pledgor agrees that private sales made under the
foregoing circumstances shall be deemed to have been made in a
commercially reasonable manner.
12. The remedies provided herein in favor of the Bank shall
not be deemed exclusive, but shall be cumulative, and shall be in
addition to all other remedies in favor of the Bank existing at
law or in equity.
13. The Bank shall have the right, for and in the name,
place and stead of the Pledgor, to execute endorsements,
assignments or other instruments of conveyance or transfer with
respect to all or any of the Collateral.
14. The Bank shall have no duty as to the collection or
protection of the Collateral or any income thereon or as to the
preservation of any rights pertaining thereto, beyond the safe
custody of any thereof actually in its possession. With respect
to any maturities, calls, conversions, exchanges, redemptions,
offers, tenders or similar matters relating to any of the
Collateral (herein called "events"), the Bank's duty shall be
fully satisfied if (i) the Bank exercises reasonable care to
ascertain the occurrence and to give reasonable notice to the
Pledgor of any events applicable to any Collateral which is
registered and held in the name of the Bank or its nominee, (ii)
the Bank gives the Pledgor reasonable notice of the occurrence of
any events, of which the Bank has received actual knowledge, as
to any securities which are in bearer form or are not registered
and held in the name of the Bank or its nominee (the Pledgor
agreeing to give the Bank reasonable notice of the occurrence of
any events applicable to any securities in the possession of the
Bank of which the Pledgor has received knowledge), and (iii) in
the exercise of its sole discretion (a) the Bank endeavors to
take such action with respect to any of the events as the Pledgor
may reasonably and specifically request in writing in sufficient
time for such action to be evaluated and taken or (b) if the Bank
determines that the action requested might adversely affect the
value of the Collateral as collateral, the collection of the
Loans, or otherwise prejudice the interests of the Bank, the Bank
gives reasonable notice to the Pledgor that any such requested
action will not be taken and if the Bank makes such determination
or if the Pledgor fails to make such timely request, the Bank
takes such other action as it deems advisable in the
circumstances. Except as hereinabove specifically set forth, the
Bank shall have no further obligation to ascertain the occurrence
of, or to notify the Pledgor with respect to, any events and
shall not be deemed to assume any such further obligation as a
result of the establishment by the Bank of any internal
procedures with respect to any securities in its possession. The
Pledgor releases the Bank from any claims, causes of action and
demands at any time arising out of or with respect to this
Agreement, the Collateral and/or any actions, taken or omitted to
be taken by the Bank with respect thereto, and the Pledgor hereby
agrees to hold the Bank harmless from and with respect to any and
all such claims, causes of action and demands.
15. The Pledgor hereby irrevocably appoints the Bank as the
Pledgor's attorney-in-fact for the purpose of carrying out the
provisions of this Agreement and taking any action and executing
any instrument which either may deem necessary or advisable to
accomplish the purposes hereof. Without limiting the generality
of the foregoing, the Bank shall have the right and power to
receive, endorse and collect all checks and other orders for the
payment of money made payable to the Pledgor representing any
interest or dividend or other distribution payable in respect of
the Collateral or any part thereof and to give full discharge for
the same.
16. No delay on the part of the Bank in exercising any of
its options, powers or rights, or partial or single exercise
thereof, shall constitute a waiver thereof. The pledge of the
Collateral hereby shall not in any way preclude or restrict any
recourse by the Bank against the Borrower or any other person or
entity liable with regard to the Secured Obligations or any other
collateral therefor.
17. Upon the repayment in full of all principal, interest
and other amounts that may be payable with regard to the Loans,
the Pledgor shall be entitled to the return of all of the
Collateral and of all other property and cash which have not been
used or applied toward the payment of such principal, interest
and other amounts free and clear of all liens in favor of the
Bank or any encumbrances imposed by the Bank. Except as
aforesaid, the assignment by the Bank to the Pledgor of such
Collateral and other property shall be without representation or
warranty of any nature whatsoever and wholly without recourse.
18. Any notice or demand upon the Pledgor shall be deemed
to have been sufficiently given for all purposes thereof if
mailed, postage prepaid, by registered or certified mail, return
receipt requested, or if delivered, to the Pledgor at the address
specified below, or at such other address as the Pledgor may
theretofore have designated in writing and given in like manner
to the Bank.
19. Any waiver, permit, consent or approval of any kind or
character on the part of the Bank of any breach or default under
this Agreement or any such waiver of any provision or condition
of this Agreement must be in writing and shall be effective only
to the extent specifically set forth in such writing.
20. This Agreement and the rights and obligations of the
Bank and the Pledgor hereunder shall be construed in accordance
with and governed by the laws of the State of New York, cannot be
changed orally and shall bind and inure to the benefit of the
Pledgor and the Bank and their respective successors and assigns,
and all subsequent holders of the Secured Obligations.
21. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all
of which taken together shall constitute but one and the same
instrument.
22. This Agreement replaces all prior agreements between
the Pledgor and the Bank relating to the Collateral contained in
any promissory note delivered to the Bank by the Pledgor.
23. The Pledgor agrees to pay the Bank on demand all costs,
including legal fees, incurred by the Bank in connection with the
administration and enforcement of this Agreement.
IN WITNESS WHEREOF, the Pledgor and the Bank have caused
this Agreement to be duly executed as of the day and year first
above written.
_____________________________
LEONARD RIGGIO
Address:
733 Park Avenue, 17th Floor
New York, New York 10021
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By: _________________________
Jeffrey Westcott,
Vice President
Address:
9 West 57th Street
New York, New York 10019
Attention: Jeffrey Westcott
<PAGE>
Exhibit A
THE COLLATERAL
Name of Issuer of Pledged
Shares (the "Corporation") No. of Shares Class of Shares Certificate No.
Barnes & Noble, Inc. (SEE ATTACHED SCHEDULE)
Date of Acquisition Nature of Acquisition Date on which Shares
of Shares of Shares fully paid for
NUMBER OF SHARES OF THE CORPORATION OWNED BY PLEDGOR
The Pledgor represents that:
(a) the total number of shares that he directly owns of the class of
security of the Corporation hereby being pledged is 4,486,209, and
(b) the total number of all other classes of the securities of the
Corporation directly or indirectly owned by the Pledgor is NONE
SALES BY PLEDGOR OF STOCK OF THE CORPORATION
The Pledgor represents to the Bank that during the last three months he, or
any person(s) who Pledgor must aggregate his sales with under Rule 144 of
the Securities Act of 1933, as amended,
(a) has sold 0 shares of the Corporation; and
(b) has sold 0 convertible securities which are convertible
into shares of the Corporation.
In addition, the Pledgor and such person(s) currently have no sale orders
open with any broker and that he and they will not place any such sale
orders to sell shares of the Corporation or such convertible securities
without the prior express written consent of the Bank.
<PAGE>
EXISTING PLEDGES TO OTHERS OF STOCK OF THE CORPORATION
No. of Pledged
Shares Date of Pledge Pledgee
NONE
BARNES & NOBLE, INC. COMMON STOCK
---------------------------------
ACQUISITON AND NATURE OF
CERT NO. NO. OF SHARES FULL PAYMENT DATE ACQUISITION
- -------- ------------- ----------------- ------------
4 100 12/30/86 Original Issue
7 106 12/30/86 Original Issue
12 283 12/30/86 Original Issue
90 1,194,915 12/30/86 Original Issue
243 727,800 12/30/86 Original Issue
412 630,000 12/30/86 Original Issue
485 398,769 11/16/92 Original Issue
607 491,167 12/30/86 Original Issue
758 833,669 11/16/92 Original Issue
23,300 1/17/97 Open Market Purchase
25,000 1/21/97 Open Market Purchase
10,000 1/21/97 Open Market Purchase
7,000 1/21/97 Open Market Purchase
5,000 1/21/97 Open Market Purchase
24,900 1/22/97 Open Market Purchase
22,600 1/22/97 Open Market Purchase
5,500 1/22/97 Open Market Purchase
10,000 2/25/97 Open Market Purchase
26,100 2/25/97 Open Market Purchase
50,000 2/25/97 Open Market Purchase
PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of March 3, 1997 between LEONARD
RIGGIO AND LOUISE RIGGIO (the "Pledgors") and MORGAN GUARANTY
TRUST COMPANY OF NEW YORK (the "Bank").
WHEREAS, the Bank may extend loans or other credit
facilities or financial accommodations (collectively, the
"Loans") to or on behalf of either or both of the Pledgors;
NOW, THEREFORE, to induce the Bank to extend the Loans and
to secure their obligations (collectively, the "Secured
Obligations") with regard thereto, for good consideration, the
receipt and adequacy of which are hereby acknowledged, the
Pledgors and the Bank agree as follows:
1. As collateral security for the performance of the
Secured Obligations, the Pledgors hereby pledge and assign to the
Bank, and grant to the Bank a security interest in, all assets
and property now and hereafter maintained on deposit by the
Pledgors in Custody Account No. 89318 at the Bank (such assets
and property being hereinafter referred to as the "Collateral"
and such account being hereinafter referred to as the "Collateral
Account"). Upon the consent of the Bank the Pledgors may from
time to time withdraw portions of the Collateral and substitute
other property acceptable to the Bank therefor, which substituted
property shall then be deemed to constitute a portion of the
Collateral, provided, that the Pledgors shall at all times
maintain Collateral in the Collateral Account having a lending
value, as determined by the Bank in its sole discretion, at least
equal to the Dollar amount of the Secured Obligations.
2. A. The Pledgors represent and warrant that all of the
contents of the Collateral Account are and will be validly and
duly pledged to the Bank in accordance with law, and agree to
defend the Bank's right, title, lien and security interest in and
to the Collateral against the claims and demands of all persons
whomsoever. The Pledgors also represent and warrant to the Bank
that they have, and will have upon deposit with the Bank, title
to all of the contents of the Collateral Account, free and clear
of all claims, mortgages, pledges, liens, encumbrances and
security interests of every nature whatsoever, and that no
consent or approval of any governmental or regulatory authority,
or of any securities exchange, was or is necessary to the
validity of this pledge.
B. The Pledgors will faithfully preserve and protect the
Bank's security interest in the Collateral and will do all such
acts and things and execute and deliver all such documents and
instruments, including without limitation further pledges,
assignments, financing statements and continuation statements, as
the Bank in its sole discretion may reasonably deem necessary or
advisable from time to time in order to preserve, protect and
perfect such security interest. The Pledgors hereby authorize
the Bank to sign and file financing and continuation statements
without the signature of the Pledgors.
C. The Pledgors represent and warrant that no liens,
security interests or adverse claims other than in favor of the
Bank exist upon any of the contents of the Collateral Account.
The Pledgors will not permit any liens, security interests or
adverse claims other than in favor of the Bank to exist upon any
of the contents of the Collateral Account. The Pledgors shall not
enter into any agreement imposing any restrictions on the
transferability of the Collateral or that would otherwise lessen
in any way its value as collateral.
3. If at any time the Secured Obligations shall be in
default the Bank may cause all or any of the Collateral to be
transferred to or registered in its name or the name of its
nominee or nominees.
4. In the event the Secured Obligations shall be in default
(i) all dividends, interest and other distributions at any time
and from time to time declared or paid upon any of the Collateral
shall become part of the Collateral and (ii) the Bank shall be
entitled to exercise all voting power with regard to the
Collateral.
5. If any of the Secured Obligations shall not be performed
forthwith as and when due in accordance with their terms, the
Bank, without obligation to resort to other security, shall have
the right at any time and from time to time to sell, resell,
assign and deliver, in its discretion, all or any of the
Collateral, in one or more parcels at the same or different
times, and all right, title and interest, claim and demand
therein and right of redemption thereof, on any securities
exchange on which the Collateral or any of it may be listed, or
at public or private sale, for cash, upon credit or for future
delivery, and in connection therewith the Bank may grant options,
the Pledgors hereby waiving and releasing any and all equity or
right of redemption. If any of the Collateral is sold by the
Bank upon credit or for future delivery, the Bank shall not be
liable for the failure of the purchaser to purchase or pay for
the same and, in the event of any such failure, the Bank may
resell such Collateral. In no event shall the Pledgors be
credited with any part of the proceeds of sale of any Collateral
until cash payment thereof has actually been received by the
Bank. In addition, should any portion of the Collateral consist
of a time deposit or deposits with a financial institution, the
Bank may terminate such deposit or deposits prior to the maturity
thereof and any penalties payable in connection therewith shall
be for the sole account of the Pledgors.
6. No demand, advertisement or notice, all of which are
hereby expressly waived, shall be required in connection with any
sale or other disposition of any part of the Collateral which
threatens to decline speedily in value or which is of a type
customarily sold on a recognized market; otherwise the Bank shall
give the Pledgors at least five business days' prior notice of
the time and place of any public sale and of the time after which
any private sale or other disposition is to be made, which notice
the Pledgors agree is reasonable, all other demands,
advertisements and notices being hereby waived. The Bank shall
not be obligated to make any sale of Collateral if it shall
determine not to do so, regardless of the fact that notice of
sale may have been given. The Bank may, without notice or
publication, adjourn any public or private sale or cause the same
to be adjourned from time to time by announcement at the time and
place fixed for sale, and such sale may, without further notice,
be made at the time and place to which the same was so adjourned.
In the case of all sales of Collateral, public or private, the
Pledgors shall pay all costs and expenses of every kind for sale
or delivery, including brokers' and attorneys' fees, and after
deducting such costs and expenses from the proceeds of sale, the
Bank shall apply any residue to the payment of principal,
interest and other amounts owed with regard to the Secured
Obligations. The balance, if any, remaining after payment in
full of all such amounts shall be paid to the Pledgors, subject
to any duty of the Bank imposed by law to the holder of any
subordinate security interest in the Collateral known to the
Bank.
7. The Pledgors recognize that the Bank may be unable to
effect a public sale of all or a part of the Collateral by reason
of certain prohibitions contained in the Securities Act of 1933,
as amended, as now or hereafter in effect, or in applicable Blue
Sky or other state securities laws, as now or hereafter in
effect, but may be compelled to resort to one or more private
sales to a restricted group of purchasers who will be obliged to
agree, among other things, to acquire such Collateral for their
own account, for investment and not with a view to the
distribution or resale thereof. The Pledgors agree that private
sales so made may be at prices and other terms less favorable to
the seller than if such Collateral were sold at public sales, and
that the Bank has no obligation to delay sale of any such
Collateral for the period of time necessary to permit the issuer
of such Collateral, even if such issuer would agree, to register
such Collateral for public sale under such applicable securities
laws. The Pledgors agree that private sales made under the
foregoing circumstances shall be deemed to have been made in a
commercially reasonable manner.
8. The remedies provided herein in favor of the Bank shall
not be deemed exclusive, but shall be cumulative, and shall be in
addition to all other remedies in favor of the Bank existing at
law or in equity.
9. The Bank shall have the right, for and in the name,
place and stead of the Pledgors, to execute endorsements,
assignments or other instruments of conveyance or transfer with
respect to all or any of the Collateral.
10. The Bank shall have no duty as to the collection or
protection of the Collateral or any income thereon or as to the
preservation of any rights pertaining thereto, beyond the safe
custody of any thereof actually in its possession. With respect
to any maturities, calls, conversions, exchanges, redemptions,
offers, tenders or similar matters relating to any of the
Collateral (herein called "events"), the Bank's duty shall be
fully satisfied if (i) the Bank exercises reasonable care to
ascertain the occurrence and to give reasonable notice to the
Pledgors of any events applicable to any Collateral which is
registered and held in the name of the Bank or its nominee, (ii)
the Bank gives the Pledgors reasonable notice of the occurrence
of any events, of which the Bank has received actual knowledge,
as to any securities which are in bearer form or are not
registered and held in the name of the Bank or its nominee (the
Pledgors agreeing to give the Bank reasonable notice of the
occurrence of any events applicable to any securities in the
possession of the Bank of which the Pledgors have received
knowledge), and (iii) in the exercise of its sole discretion (a)
the Bank endeavors to take such action with respect to any of the
events as the Pledgors may reasonably and specifically request in
writing in sufficient time for such action to be evaluated and
taken or (b) if the Bank determines that the action requested
might adversely affect the value of the Collateral as collateral,
the collection of the Loans, or otherwise prejudice the interests
of the Bank, the Bank gives reasonable notice to the Pledgors
that any such requested action will not be taken and if the Bank
makes such determination or if the Pledgors fail to make such
timely request, the Bank takes such other action as it deems
advisable in the circumstances. Except as hereinabove
specifically set forth, the Bank shall have no further obligation
to ascertain the occurrence of, or to notify the Pledgors with
respect to, any events and shall not be deemed to assume any such
further obligation as a result of the establishment by the Bank
of any internal procedures with respect to any securities in its
possession. The Pledgors release the Bank from any claims,
causes of action and demands at any time arising out of or with
respect to this Agreement, the Collateral and/or any actions,
taken or omitted to be taken by the Bank with respect thereto,
and the Pledgors hereby agree to hold the Bank harmless from and
with respect to any and all such claims, causes of action and
demands.
11. The Pledgors hereby irrevocably appoint the Bank as
their attorney-in-fact for the purpose of carrying out the
provisions of this Agreement and taking any action and executing
any instrument which either may deem necessary or advisable to
accomplish the purposes hereof. Without limiting the generality
of the foregoing, the Bank shall have the right and power to
receive, endorse and collect all checks and other orders for the
payment of money made payable to the Pledgors representing any
interest or dividend or other distribution payable in respect of
the Collateral or any part thereof and to give full discharge for
the same.
12. No delay on the part of the Bank in exercising any of
its options, powers or rights, or partial or single exercise
thereof, shall constitute a waiver thereof.
13. Upon the repayment in full of all principal, interest
and other amounts that may be payable with regard to the Loans
and the Bank's having determined that no contingent obligations
of either Pledgors that it wishes to remain secured hereunder
shall exist, the Pledgors shall be entitled to the return of all
of the Collateral and of all other property and cash which have
not been used or applied toward the payment of such principal,
interest and other amounts free and clear of all liens in favor
of the Bank or any encumbrances imposed by the Bank. Except as
aforesaid, the assignment by the Bank to the Pledgors of such
Collateral and other property shall be without representation or
warranty of any nature whatsoever and wholly without recourse.
14. Any notice, demand or service of process upon the
Pledgors shall be deemed to have been sufficiently given for all
purposes thereof if mailed, postage prepaid, by registered or
certified mail, return receipt requested, or if delivered, to the
Pledgors at the address specified below, or at such other address
as the Pledgors may theretofore have designated in writing and
given in like manner to the Bank.
15. Any waiver, permit, consent or approval of any kind or
character on the part of the Bank of any breach or default under
this Agreement or any such waiver of any provision or condition
of this Agreement must be in writing and shall be effective only
to the extent specifically set forth in such writing.
16. This Agreement and the rights and obligations of the
Bank and the Pledgors hereunder shall be construed in accordance
with and governed by the laws of the State of New York, cannot be
changed orally and shall bind and inure to the benefit of the
Pledgors and the Bank and their respective successors and
assigns, all subsequent holders of the Secured Obligations and
to the Pledgors' heirs, executors and legal representatives. The
Pledgors hereby submit to the nonexclusive jurisdiction of the
United States District Court for the Southern District of New
York and of any New York State Court sitting in New York City for
purposes of all legal proceedings arising out of or relating to
this Agreement or any agreement received by the Bank in
connection herewith. The Pledgors irrevocably waive, to the
fullest extent permitted by law, any objection which they may now
or hereafter have to the laying of the venue of any such
proceeding brought in such a court and any claim that any such
proceeding brought in such a court has been brought in an
inconvenient forum. The Pledgors hereby irrevocably waive any
and all right to trial by jury in any legal proceeding arising
out of or relating to this Agreement or any agreement received by
the Bank in connection herewith.
17. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all
of which taken together shall constitute but one and the same
instrument.
18. This Agreement replaces all prior agreements between
the Pledgors and the Bank relating to the Collateral contained in
any promissory note delivered to the Bank by the Pledgors.
19. The Pledgors agree to pay the Bank on demand all costs,
including legal fees, incurred by the Bank in connection with the
administration and enforcement of this Agreement.
20. The Pledgors shall be jointly and severally liable.
IN WITNESS WHEREOF, the Pledgors and the Bank have caused
this Agreement to be duly executed as of the day and year first
above written.
_____________________________
Leonard Riggio
_____________________________
Louise Riggio
Address:
733 Park Avenue, 17th Floor
New York, New York 10021
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By: _________________________
Jeffrey B. Westcott
Vice President
Address:
9 West 57th Street
New York, New York 10019
Attention: Jeffrey B. Westcott
