EXHIBIT 10.36
DATED NOVEMBER 30, 2001
PALM IRELAND INVESTMENT
and
FOOTHILL CAPITAL CORPORATION
(as Agent)
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SHARE CHARGE
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Arthur Cox
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Earlsfort Centre
Earlsfort Terrace
Dublin 2
WJ1844/jb
29/11/01
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THIS SHARE CHARGE is made the 30th of November, 2001.
BETWEEN:
(1) PALM IRELAND INVESTMENT, a company incorporated and registered under the
laws of Ireland having its registered office at 5 Richview Office Park,
Clonskeagh, Dublin 14, (the "Chargor"); and
(2) FOOTHILL CAPITAL CORPORATION, a Californian corporation with its principal
place of business at 2450 Colorado Avenue, Suite 3000 West, Santa Monica,
Los Angeles California 90404 USA as agent for the hereinafter defined
Lenders (the "Agent").
WITNESSES as follows:
1 DEFINITIONS AND INTERPRETATION
1.1 Definitions:
In this Share Charge, words or expressions defined in the Loan Agreement
(as defined below) shall, unless otherwise defined below, bear the same
meaning in this Share Charge and, in addition, in this Share Charge
(unless the context otherwise requires) the following expressions have the
following meanings:
"Business Day" means a day on which banks generally are open for business
(other than a day on which banks are only open for business in euro) in
California (excluding Saturdays, Sundays and bank or public holidays in
those places);
"Charged Property" means all Investments from time to time charged in
favour of, or assigned to, Agent on behalf of the Lender Group by or
pursuant to this Share Charge;
"Default" has the meaning given to it in the Loan Agreement;
"Event of Default" has the meaning given to it in the Loan Agreement;
"Group" means together the Domestic Parent (as defined in the Loan
Agreement) and its direct and indirect subsidiaries from time to time and
"Group Company" means any of such entities;
"Investments" means
(a) the Securities; and
(b) all stocks, shares or other securities, rights, monies or other
property (together the "Derivative Assets") accruing, offered,
issued or otherwise derived at any time (whether before or after
the date of this Share Charge) by way of bonus, redemption,
exchange, purchase, substitution, conversion, preference, option or
otherwise in respect of any of the Securities; and
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(c) all dividends, interest and other distributions paid or payable in
respect of or deriving from any of the Securities or the Derivative
Assets or deriving from any investment of any such dividends,
interest or other income provided however that the Investments shall
at no time exceed 100% of the entire issued ordinary share capital of
Subsidiary Borrower;
"Irish Debenture" means the Debenture of even date herewith executed by
Subsidiary Borrower and Agent;
"Irish Loan Documents" has the meaning given to it in the Loan Agreement;
"Lender Group" shall have the meaning given to it in the Loan Agreement;
"Lenders" shall have the meaning given to it in the Loan Agreement and
shall include (where the context permits or requires) any successor,
assignee or transferee lenders permitted under the Loan Agreement;
"Lien" means any lien, mortgage, charge, standard security, pledge,
hypothecation, security trust, assignment by way of security, or any other
security interest whatsoever, howsoever created or arising or any other
agreement or arrangement, having the commercial effect of conferring
security and any agreement to enter into, create or establish any of the
foregoing;
"Loan Agreement" means the Loan Agreement of even date herewith among Palm
Global Operations Limited as Subsidiary Borrower, the Lenders, Agent,
Heller Financial, Inc. as the Syndication Agent, and The CIT
Group/Business Credit, Inc. as the Documentation Agent.
"UK Loan Documents" has the meaning given to it in the Loan Agreement;
"Permitted Lien" has the meaning given to it in the Loan
Agreement;"Secured Sums" means all money and liabilities covenanted to be
paid or discharged by the Chargor to Agent on behalf of the Lender Group
under Clause 2.1 (Covenant to Pay);
"Securities" means the securities described in the First Schedule and all
other stocks, shares or other securities or investments now or in the
future owned at law or in equity by the Chargor constituting 100% of the
issued share capital of Subsidiary Borrower but not including, for the
avoidance of doubt, stocks, shares or other securities or investments in
the capital of any other company or entity; and
"Subsidiary Borrower" means Palm Global Operations Limited, a company
incorporated under the laws of Ireland with its registered office at 25-28
North Wall Quay, Dublin 1.
1.2 Interpretation:In this Share Charge, unless the context otherwise
requires:
1.2.1 words denoting the singular number only shall include the plural
number also and vice versa; words denoting the masculine gender
only shall also include the
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feminine gender; words denoting persons only shall include
corporations, partnerships and unincorporated associations;
1.2.2 references to clauses, paragraphs and Schedules are to be construed
as references to clauses, paragraphs and Schedules of this Share
Charge;
1.2.3 references to any party shall, where relevant, be deemed to be
references to or to include, as appropriate, their respective
successors or permitted assigns;
1.2.4 references in this Share Charge to this Share Charge or any other
document include references to this Share Charge or such other
document as varied, supplemented, restated and/or replaced in any
manner from time to time and/or any document which varies,
supplements, restates and/or replaces it;
1.2.5 references to "including" and "in particular" shall not be
construed restrictively but shall be construed as meaning
"including, without prejudice to the generality of the foregoing"
and "in particular, but without prejudice to the generality of the
foregoing" respectively;
1.2.6 references to moneys, obligations and liabilities due, owing or
incurred under the Loan Agreement shall include money, obligations
and liabilities due, owing or incurred in respect of any extensions
or increases in the amount of the facilities provided for therein
or the obligations and liabilities imposed thereunder;
1.2.7 expressions defined in the Companies Act 1963 shall have the same
meanings in this Share Charge, except that the expression "company"
shall include a body corporate established outside Ireland;
1.2.8 any reference to any statute or any section of any statute shall be
deemed to include reference to any statutory modification or
re-enactment of it for the time being in force;
1.2.9 references to "law" shall include any present or future common law,
statute, statutory instrument, treaty, regulation, directive,
order, decree, other legislative measure, code, circular, notice,
demand, or injunction binding on the persons to whom it is directed
to comply;
1.2.10 a "person" includes any person, individual, firm, company,
corporation, government, state or agency of a state or any
undertaking or other association, organisation, trust or agency
(whether or not having separate legal personality) or any two or
more of the foregoing;
1.2.11 "winding-up" of any person includes its dissolution and/or
termination and/or any equivalent or analogous proceedings under
the law of any jurisdiction in which the person concerned is
incorporated, registered, established or carries on business or to
which that person is subject;
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1.2.12 reference to "writing" include any telex and facsimile transmission
legibly received, except, unless the Lender otherwise agrees, in
relation to any certificate, forecast, report, notice, resolution
or other document which is expressly required by this Agreement to
be signed, and "written" has corresponding meaning; and
1.2.13 a time of day is a reference to Dublin time, unless otherwise
stated.
1.3 Index and Headings:The index to and the headings in this Share Charge are
inserted for convenience and shall not affect its interpretation.
2 COVENANT TO PAY
2.1.1 Covenant to Pay:The Chargor hereby covenants that it will, on demand
in writing made to it by Agent, on or following the making of a demand
made in accordance with the Loan Agreement, pay or discharge to Agent on
behalf of the Lender Group all money and liabilities now or in the future
due, owing or incurred to the Lender Group pursuant to the Irish Loan
Documents (other than under clause 2.1.2 of the Irish Debenture) by
Subsidiary Borrower as and when the same fall due for payment,but which
are not paid on their due date.
2.2 Demands from Agent:The making of one demand under this Share Charge will
not preclude Agent from making any further demands.
3 CHARGING CLAUSE
3.1 Charging Clause:The Chargor as legal and beneficial owner hereby charges
to Agent on behalf of the Lender Group as security for the payment or
discharge of all Secured Sums by way of first fixed charge, all the
Chargor's interest in the Investments.
3.2 Proviso for Redemption:On irrevocable and unconditional payment and
discharge of all the Secured Sums and upon the Lender Group being under no
further obligation to provide financial accommodation to the Group
pursuant to the Irish Loan Documents, Agent will as soon as practicable at
the request and cost of the Chargor execute such documents (or procure
that its nominees execute such documents) as the Chargor may reasonably
request which may be required to discharge the security created by this
Share Charge.
4 DOCUMENTS AND VOTING RIGHTS
4.1 Deposit of Documents:Except as otherwise expressly agreed in writing by
Agent, the Chargor shall:
4.1.1 upon executing this Share Charge and, in relation to after acquired
Charged Property, within 30 Business Days of receipt by the Chargor
of the relevant documents of title, deposit with Agent, and Agent
shall be entitled to retain all stock and share certificates and
other documents evidencing, or documents of title relating to, the
Charged Property together with stock transfer forms (or equivalent
instruments of transfer), with the name of the transferee, the
consideration and the
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date left blank, but otherwise duly completed and executed by the
person in whose name such certificate or document is, on the basis
that Agent (or its nominee) shall be entitled to hold such
certificates, documents, power of attorney and stock transfer forms
(or equivalent instruments of transfer) until the Secured Sums have
been irrevocably and unconditionally discharged in full (in
accordance with Clause 3.2 (Proviso for Redemption)) and shall be
entitled at any time after an Event of Default has occurred and is
continuing to complete (pursuant to its powers in Clause 11 (Power
of Attorney)) the stock transfer forms (or equivalent instruments of
transfer) on behalf of Agent in favour of Agent or such other
persons as it shall select; and
4.1.2 execute and deliver to Agent such documents and transfers and give
such instructions and perform such other acts as Agent may
reasonably require at any time to constitute or perfect an equitable
or legal charge (at Agent's option) over registered Charged Property
or a pledge over bearer Charged Property, including any Charged
Property which the Chargor elects to hold in any paperless transfer
and settlement system or held in a clearing system.
4.2 Voting Rights:
4.2.1 Unless and until an Event of Default occurs and is continuing:
4.2.1.1 all voting and other rights attaching to any Charged
Property shall continue to be exercised subject to Clause 5
(Negative Pledge) by the Chargor for so long as it remains
the registered owner and the Chargor shall not permit any
person other than itself or a reputable paperless transfer
and settlement or clearing system, Agent or Agent's nominee
to be registered as holder of any Charged Property; and
4.2.1.2 if the Charged Property charged under this Share Charge is
registered in the name of Agent, all voting and other
rights attaching to it shall be exercised by Agent or its
nominee in accordance with instructions in writing from
time to time received from the Chargor;
provided that the Chargor shall not exercise such voting rights in a
manner which adversely affects the validity or enforceability of the
security created by this Share Charge or would result in Agent or
its nominee incurring any cost or expense or being subject to any
liability unless previously indemnified to its satisfaction.
4.2.2 Unless an Event of Default occurs and is continuing, the Chargor
shall be entitled to receive and retain all dividends, distributions
and other monies paid on or derived from the Charged Property.
4.2.3 After an Event of Default occurs and for so long as such an Event of
Default is continuing, Agent on behalf of the Lender Group shall be
entitled to:
4.2.3.1 receive and retain all dividends, distributions and other
monies paid on the Charged Property; and
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4.2.3.2 exercise or direct the exercise of the voting rights
attached to any of the Charged Property in such manner as
it considers fit. The Chargor shall after such time:
4.2.3.2.1 comply, or procure the compliance, with any directions of
Agent in respect of the exercise of the voting rights
attached to such Investments; and
4.2.3.2.2 if Agent so requires by notice to the Chargor,
immediately deliver to Agent a form of proxy or other
authority (in each case, in such form as Agent shall
reasonably require) appointing such person as Agent shall
select as proxy of the Chargor or, as the case may be,
its nominee or otherwise enabling such person as Agent
shall select to exercise such voting rights as shall be
specified (whether generally or specifically) in the
relevant notice.
4.3 Payment of Costs on Securities:The Chargor shall duly and promptly pay all
costs, instalments or other payments which from time to time become due in
respect of any Charged Property. In the case of any default by the Chargor
in this respect Agent may, if it thinks fit, make any such payments on
behalf of the Chargor, in which event any sums so paid shall be reimbursed
on demand by the Chargor to Agent and until reimbursed shall bear interest
in accordance with Clause 13.3 (Overdue Amounts) and shall be secured on
the Charged Property.
4.4 Collection of Distributions:At any time following the registration of the
Charged Property in the name of Agent or its nominee in accordance with
Clause 4.2.1, Agent shall not be under any duty to ensure that any
dividends, distributions or other monies payable in respect of the Charged
Property are duly or promptly paid or received by it or its nominee, or to
verify that the correct amounts are paid or received, or to take any
action in connection with the taking up of any (or any offer of any)
stocks, shares, rights, monies or other property paid, distributed,
accruing or offered at any time by way of interest, dividend, redemption,
bonus, rights, preference, option, warrant or otherwise on, or in respect
of or in substitution for, any of the Charged Property.
4.5 Maintenance of Legal Validity:The Chargor shall obtain, comply with the
terms of and do all that is necessary to maintain in full force and effect
all authorisations, approvals, licences and consents required in or by the
laws and regulations of its jurisdiction of incorporation to enable it
lawfully to enter into and perform its obligations under this Share Charge
and to ensure the legality, validity, enforceability or admissibility in
evidence in its jurisdiction of incorporation and Ireland of this Share
Charge.
5 NEGATIVE PLEDGE AND OTHER RESTRICTIONS
The Chargor shall not, without the prior written consent of Agent (save as
otherwise permitted by any Irish Loan Document):
5.1.1 create, or agree or attempt to create, or permit to arise or
subsist, any lien of any kind (save for Permitted Liens) or any
trust over any of the Charged Property;
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5.1.2 sell, transfer, assign or otherwise dispose of any of the Charged
Property or the equity of redemption in respect of the Charged
Property; or
5.1.3 do or cause or permit to be done anything which may in any way
materially depreciate, jeopardise or otherwise materially prejudice
the market value or collateral value of the Charged Property or the
rights of Agent on behalf of the Lender Group hereunder.
6 FURTHER ASSURANCE
To the extent required to comply with the Loan Agreement, the Chargor
shall promptly following demand by Agent in writing, execute and deliver
to Agent at the cost of the Chargor and in such form as Agent may
reasonably require, such other documents as Agent may reasonably require
to secure the payment of the Secured Sums, or to perfect or protect this
Share Charge or facilitate its realisation or the exercise of Agent's
rights thereunder, or following an Event of Default which is continuing,
to vest title to any Charged Property in itself or its nominee or any
purchaser and/or to create a legal mortgage over the Securities or
Derivative Assets and to register such security or title in any applicable
register in each case consistent with the jurisdiction in which such asset
is situated and/or to facilitate the realisation of this security or
Agent's rights under this Share Charge.
7 CONTINUING SECURITY
7.1 Continuing Security:This Share Charge shall be a continuing security,
notwithstanding any intermediate payment or settlement of account or any
other matter whatever, and shall be in addition to and shall not prejudice
or be prejudiced by any right of Lien, set-off or other rights exercisable
by Agent on behalf of the Lender Group or Agent on behalf of the Lender
Group as banker against any Group Company or any Lien, guarantee,
indemnity and/or negotiable instrument now or in the future held by Agent
on behalf of the Lenders. Agent shall not be bound to enforce any other
Lien before enforcing the security created by this Share Charge. Section
17 of the Conveyancing Act 1881 shall not apply to this Share Charge.
7.2 Subrogation:- During the continuance of this Share Charge:
7.2.1 any rights of the Chargor, by reason of the performance of any of
its obligations under this Share Charge, the enforcement of any of
the charges contained herein or any action taken pursuant to any
rights of any person conferred by or pursuant to this Share Charge
or by law (so far as they relate to any of the Charged Property,
the Agent on behalf of the Lender Group as the person entitled to
any of the charges contained herein, any receiver or any delegate
of the Chargor):
7.2.1.1 to be indemnified by any person; or
7.2.1.2 to prove in respect of any liability in the winding-up of any
person; or
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7.2.1.3 to take the benefit of or enforce any security interest or
guarantees or to exercise any rights of contribution,
(all such rights the "Subrogation Rights") shall be exercised and
enforced by the Chargor in such manner and on such terms, and only
in such manner and on such terms, as Agent may require (and,
without limitation, Agent shall be entitled to require the Chargor
not to exercise or enforce any Subrogation Rights);
7.2.2 any amount received by the Chargor as a result of any exercise of
any Subrogation Rights shall be held in trust for and immediately
paid to Agent on behalf of the Lender Group;
Provided that no Subrogation Rights shall arise or exist, which if they
did exist would constitute a right to be indemnified by, to prove in the
winding-up of, to take the benefit of any Lien or guarantee granted by, or
to exercise any rights of contribution against, Subsidiary Borrower, and
the Chargor waives all its entitlement and rights to or in respect of any
such Subrogation Rights.
7.2.3 Waiver of Defences: The liabilities and obligations of the Chargor
under this Share Charge shall remain in force irrespective of
whatever dealings may occur between the Agent, the Lenders, the
Chargor and Subsidiary Borrower including, without limitation, the
granting of any additional time for the performance of any
obligation, or the variation of any obligation.
8 POWERS OF SALE
8.1 Statutory Power of Sale to arise on Enforcement:The restrictions in
Section 20 of the Conveyancing Act 1881 shall not apply to this Share
Charge, but the statutory power of sale (as varied and extended by this
Share Charge) shall (as between Agent and a purchaser from Agent), and the
Agent shall have the power to appoint a receiver of the Charged Property
(or the income thereof) which shall, arise immediately on the execution of
this Share Charge without restrictions (statutory or otherwise) as to the
giving of notice or otherwise. However, Agent shall not exercise such
powers until the taking of action by the Agent under clause 9 of the Loan
Agreement, but this provision shall not affect a purchaser or require him
to ask whether a demand or appointment has been made.
8.2 Third Parties not to be concerned with validity of demand:No person
dealing in good faith and for value with Agent, its agents or brokers,
shall be concerned to enquire whether this Share Charge has become
enforceable, or whether any power exercised or purported to be exercised
has become exercisable, or whether any Secured Sums remain due upon this
Share Charge or have been validly demanded, or as to the necessity or
expediency of any stipulations and conditions subject to which the sale of
any Charged Property shall be made, or otherwise as to the propriety or
regularity of the sale of any Charged Property, or to see to the
application of any money paid to Agent, or its agents or brokers, and each
such dealing shall be deemed to be within the powers hereby conferred and
to be valid and effective accordingly.
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9 OPENING OF NEW ACCOUNTS
9.1 Ruling off of Accounts:On receiving notice that the Chargor has encumbered
or disposed of any of the Charged Property, Agent may rule off such
Chargor's account or accounts and open a new account or accounts in the
name of the Chargor.
9.2 Credits not to reduce Indebtedness of Chargor:If Agent does not open a new
account or accounts immediately on receipt of such notice, it shall
nevertheless be treated as if it had done so at the time when it received
such notice and as from that time all payments made by the Chargor to
Agent on behalf of the Lender Group shall be treated as having been
credited to such new account or accounts and shall not operate to reduce
the amount owing from the Chargor to Agent on behalf of the Lender Group
at the time when it received such notice.
10 ENFORCEMENT
10.1 Statutory Powers:The powers conferred on mortgagees or receivers by the
Conveyancing Act 1881 and the Companies Acts, 1963 to 2001 shall apply to
the security constituted by this Share Charge except insofar as they are
expressly or impliedly excluded and where there is ambiguity or conflict
between the powers contained in such statutes, the powers contained in
this Share Charge shall prevail.
10.2 Liability of Agent:Neither the Agent nor any receiver or delegate shall be
liable to account as mortgagee in possession or otherwise for any money
not actually received by it.
10.3 Redemption of Prior Charges: Agent at any time following the security
constituted by this Share Charge becoming enforceable may redeem any and
all prior Liens on or relating to the Charged Property or any part thereof
or procure the transfer of such Liens to itself and may settle and pass
the accounts of the person or persons entitled to the prior Liens. Any
account so settled and passed shall be conclusive and binding on the
Chargor.
10.4 Rights of Agent:All or any of the rights which are conferred by this Share
Charge (either expressly or impliedly) upon a receiver may be exercised
after the Share Charge becomes enforceable by Agent irrespective of
whether Agent shall have taken possession or appointed a receiver of the
Charged Property.
11 POWER OF ATTORNEY
11.1 Power of Attorney:The Chargor by way of security hereby irrevocably
appoints Agent (whether or not a receiver has been appointed), and any
receiver separately, as the attorney of the Chargor (with full power to
appoint substitutes and to delegate), in its name and on its behalf, and
as its act and deed or otherwise, at any time during the continuance of an
Event of Default to:
11.1.1 execute and deliver and otherwise perfect any agreement, assurance,
deed, instrument or document; or
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11.1.2 perform any act;
which may be required of the Chargor under this Share Charge, or may be
deemed necessary by such attorney, acting reasonably, for any purpose of
this Share Charge or to enhance or perfect the security intended to be
constituted by it or following an Event of Default, to convey or transfer
legal ownership of any of the Charged Property (including the completion
of the stock transfer forms referred to in Clause 4.1 (Deposit of
Documents)).
11.2 Ratification:The Chargor undertakes, if so required, to ratify and confirm
all acts done and transactions entered into by any attorney appointed
under Clause 11.1 (Power of Attorney) in the proper exercise of its powers
in accordance with this Share Charge.
11.3 Delegation:Agent may delegate by power of attorney or in any other manner
all or any of the powers, authorities and discretions which are for the
time being exercisable by Agent under this Share Charge to any person or
persons which it shall think fit and on such terms and conditions as it
shall think fit (including power to sub-delegate) without liability for
any act or omission by such delegate.
12 APPLICATION OF MONEY RECEIVED
12.1 Application of Recoveries:Any money received under the powers conferred by
this Share Charge shall, subject to the discharge of any prior-ranking
claims, be paid or applied in the following order of priority:
12.1.1 in satisfaction of all costs, charges and expenses incurred, and
payments made by Agent in connection with the exercise of its
rights under this Share Charge (including any costs, charges and
expenses incidental to the appointment of a receiver and the
exercise of a receiver's rights and all remuneration payable to a
receiver or liabilities of a receiver);
12.1.2 in or towards satisfaction of the Secured Sums in the manner
applicable under the Irish Loan Documents; and
12.1.3 as to the surplus (if any), to the person or persons entitled to
it.
12.2 Suspense Account:Agent may, in its absolute discretion on or at any time
or times pending the payment to the Lender Group of the whole of the
Secured Sums, place and keep to the credit of a separate or suspense
account, bearing interest at a commercial rate, any money received,
recovered or realised by Agent on behalf of the Lender Group by virtue of
this Share Charge in such manner as Agent may determine without any
obligation to apply it in or towards the discharge of any Secured Sum.
That amount may be kept there (with any interest earned being credited to
that account) until Agent is satisfied that all the Secured Sums have been
discharged in full and that all facilities which might give rise to
Secured Sums have terminated.
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13 COSTS AND INTEREST ON OVERDUE AMOUNTS
13.1 Indemnity: All costs, charges and liabilities (including all properly
incurred professional fees and disbursements and value added tax and/or
any similar tax) and all other sums paid or incurred by Agent or the
Lender Group under or in connection with this Share Charge or the Irish
Loan Documents, shall be recoverable (on a full indemnity basis) as a debt
payable on demand from the Chargor, may be debited following non-payment
of such sum(s) by the Chargor when due, or, if relevant, when demanded,
without notice to any account of the Chargor, shall bear interest in
accordance with the provisions of the Irish Loan Documents and shall be
charged on the Charged Property. The Chargor shall indemnify Agent or the
Lender Group against all properly incurred costs, charges and expenses
arising out of any proceedings referable to the Chargor brought against
Agent or the Lender Group or to which Agent or the Lender Group may be a
party whether as plaintiffs or defendants or otherwise and which relate to
any Charged Property. All amounts paid by the Chargor under this Share
Charge shall be paid free and clear of any deduction or withholding on
account of tax or any other amount (save to the extent required by law)
and free of any set-off or counterclaim or otherwise. If the Chargor is
required to make any deduction or withholding by law on any sum paid or
payable by it to Agent on behalf of the Lenders under this Share Charge
the sum payable by the Chargor in respect of which the deduction or
withholding is required shall be increased to the extent necessary to
ensure that Agent or the Lender Group receives on the due date and retains
(free of any liability in respect of such deduction or withholding) a net
sum equal to the sum it would have received and retained had no such
deduction or withholding been required or made except where such deduction
or withholding is permitted by the terms of the Loan Agreement and there
is no corresponding obligation on the Subsidiary Borrower in the Loan
Agreement to account to the Lender or Agent for such sum that has been
withheld or deducted.
13.2 Types of Costs Recoverable: The costs recoverable by Agent under this
Share Charge shall include:
13.2.1 all costs properly incurred in preparing and administering this
Share Charge or perfecting the security created by it;
13.2.2 all costs (whether or not allowable on a taxation by the court) of
all proceedings for the enforcement of this Share Charge or for
the recovery or attempted recovery of the Secured Sums;
13.2.3 all money properly expended and all properly incurred costs
arising out of the exercise of any power, right or discretion
conferred by this Share Charge; and
13.2.4 all costs and losses arising from any default by the Chargor in
the payment when due of any Secured Sums or the performance of its
obligations under this Share Charge.
13.3 Overdue Amounts: Any overdue amounts secured by this Share Charge shall
carry interest at the rate and in accordance with the terms contained in
the Irish Loan
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Documents in relation to overdue sums provided under Section 2.6(c) of the
Loan Agreement or at such other rate agreed between the Chargor and Agent
from time to time. In each case, such interest shall accrue on a day to
day basis to the date of repayment in full and, if unpaid, shall be
compounded on the terms so agreed (or in the absence of such agreed terms
with monthly rests on Agent's usual monthly interest days). Interest shall
continue to be charged and compounded on this basis after as well as
before any demand or judgment.
13.4 Currency Indemnity:
13.4.1 Moneys received or held by Agent pursuant to this Share Charge
may, from time to time after demand has been made, be converted
into such currency as Agent considers necessary or desirable to
discharge the Secured Sums in that currency at such rate of
exchange as may be applicable under the Loan Agreement or, if
there is none, the prevailing spot rate of exchange of Wells Fargo
Bank, N.A. or any successor thereto (as conclusively determined by
Agent in accordance with the Loan Agreement) for purchasing the
currency to be acquired with the existing currency.
13.4.2 No payment to Agent (whether under any judgment or court order or
otherwise) shall discharge the obligation or liability in respect
of which it was made unless and until Agent shall have received
payment in full in the currency in which such obligation or
liability was incurred, and to the extent that the amount of any
such payment shall on actual conversion into such currency fall
short of such obligation or liability expressed in that currency,
Agent on behalf of the Lender Group shall have a further separate
cause of action against the Chargor and shall be entitled to
enforce this security to recover the amount of the shortfall.
To the extent that the amount of any such payment shall on actual
conversion into such currency exceed such obligation or liability
expressed in that currency, Agent shall repay that excess to the Chargor.
14 SET-OFF
14.1.1 Agent may at any time or times during the continuance of an Event
of Default retain any money standing to the credit of the Chargor
in any currency upon any account or otherwise (in any country and
whether or not in the Chargor's name) as cover for any Secured
Sums and at any time after an Event of Default without notice to
the Chargor, and may set off, combine and/or consolidate all or
any of such money with all or such part of the Secured Sums as
Agent may select (whether presently payable or not), and purchase
with any such money any other currency required to effect such
combination.
14.1.2 The Chargor irrevocably authorises Agent in its name and at its
expense to perform such acts and sign such documents as may be
required to give effect to any set-off or transfer pursuant to
Clause 14.1, including the purchase with the
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money standing to the credit of any such account of such other
currencies as may be necessary to effect such set off or
transfer.
14.1.3 The foregoing provisions of this clause shall be in addition to
and without prejudice to such rights of set off, combination,
consolidation, lien and other rights whatsoever conferred on the
Lender Group by law.
15 TRANSFER
Agent may transfer all or any part of its rights in relation to this Share
Charge and the Secured Sums or otherwise grant an interest in them to any
person to which it is entitled to make such a transfer under the Loan
Agreement.
16 DISCLOSURE
The Chargor irrevocably authorises Agent, at its discretion, at any time
or from time to time, to disclose any information concerning the Chargor,
this Share Charge and the Secured Sums to any prospective transferee or
grantee referred to in Clause 15 (Transfer), or to any affiliate of the
Agent or the Lenders and their officers, directors, employers, agents and
advisors subject to such person undertaking to the Chargor, in manner,
form and substance reasonably satisfactory to such Chargor, to keep such
information confidential. Both Agent and any prospective transferee or
grantee shall be entitled to diclose such information to their
professional advisers.
The above authority is without prejudice to any obligation of Agent to
make disclosure imposed by law.
17 FORBEARANCE AND SEVERABILITY
17.1 No Waivers: All rights, powers and privileges under this Share Charge
shall continue in full force and effect, regardless of the Agent
exercising, delaying in exercising or omitting to exercise any of them.
17.2 Invalidity and Severability:
17.2.1 None of the covenants and guarantees given and none of the charges
created by the Chargor under this Share Charge shall be avoided or
invalidated by reason only of one other or more of such covenants,
guarantees or charges being invalid or unenforceable.
17.2.2 Any provision of this Share Charge which for any reason is or
becomes illegal, invalid or unenforceable shall be ineffective
only to the extent of such illegality, invalidity and
unenforceability, without invalidating the remaining provisions of
this Share Charge or the effectiveness of any provisions of this
Share Charge under the laws of any jurisdiction.
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18 VARIATIONS AND CONSENTS
18.1 Variations in Writing: No variation of this Share Charge shall be
considered valid and as constituting part of this Share Charge, unless
such variation shall have been made in writing and signed by Agent and the
Chargor.
18.2 Variation: The expression "variation" shall include any variation,
supplement, extension, deletion or replacement however effected.
18.3 Conditional Consents: Save as otherwise expressly specified in this Share
Charge or the Loan Agreement, any consent of Agent may be given absolutely
or on any terms and subject to any conditions as Agent may determine in
its entire discretion.
19 SERVICE OF DEMANDS AND NOTICES
19.1 Notices to the Chargor: A demand for payment or any other communication to
be given to the Chargor under this Share Charge may be made or given by
any manager or officer of Agent and must be in writing addressed to the
Chargor served on it at the address for service of the Chargor stated in
the Second Schedule, or to the address last notified to Agent by the
Chargor, or by facsimile transmission to the facsimile number stated in
the Second Schedule, or to the facsimile number last notified to Agent by
the Chargor or by any other form of electronic communication which may be
available.
19.2 Notices to Agent: Any communication to be given to Agent under this Share
Charge must be given to Agent in writing served on it at 2450 Colorado
Avenue, Suite 3000 West, Santa Monica, Los Angeles California 90404 USA
(marked for the attention of Business Finance Division Manager) or by
facsimile to facsimile number 00 1 310 453 7443 or the address or
facsimile number last notified to the Chargor by Agent in writing.
19.3 Deemed Service:A notice or demand shall be deemed to be duly served on the
Chargor:
19.3.1 if delivered by hand, at the time of actual delivery;
19.3.2 if transmitted by facsimile, at the time the facsimile
transmission report (or other appropriate evidence) confirming
that the facsimile has been transmitted to the addressee is
received by the sender; or
19.3.3 if sent by first class prepaid post, at noon on the third Business
Day (or if sent by airmail, the fifth Business Day) following the
day of posting and shall be effective even if it is misdelivered
or returned undelivered;
provided that, where delivery or transmission occurs after 6.00 pm in the
place of delivery on a Business Day or on a day which is not a Business
Day, service shall be deemed to occur at 9.00 am in the place of delivery
on the next Business Day.
In proving such service, it shall be sufficient to prove that personal
delivery was made or that the envelope containing the communication was
correctly addressed and posted or
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that a facsimile transmission report (or other appropriate evidence) was
obtained that the facsimile had been transmitted to the addressee.
19.4 Service on Agent: Any communication to Agent shall be deemed to have been
given only on actual receipt by it.
20 COUNTERPARTS
This Share Charge may be executed by the parties in any number of copies,
all of which taken together shall constitute a single Share Charge.
21 ADJUSTMENT OF ACCOUNT
If the statement of account between Agent and the Chargor by reference to
which any Secured Sums are calculated for the purposes of this Share
Charge requires adjustment at any time because of any claim made against
Agent by an officeholder then, notwithstanding any other provision of this
Share Charge:
21.1.1 the Chargor's liability to Agent will be correspondingly adjusted;
21.1.2 Agent may treat any release or settlement made by it with the
Chargor before any such adjustment is required as being of no
effect; and
21.1.3 Agent may recover from the Chargor such sum as will place the
Lender Group in the same position as if such release or settlement
had not been made.
If any claim is made against Agent under any insolvency law with reference
to this Share Charge, Agent may agree the claim or settle it on any terms
it chooses without asking for the Chargor's agreement. If Agent does agree
or settle such claim, the Chargor will be liable under this Share Charge
as if a court order had been made containing the terms which Agent agreed
or settled. The Chargor will be responsible for all costs and expenses
which Agent or the Lender Group properly incurred in defending such a
claim.
22 REPRESENTATIONS AND WARRANTIES
22.1 Representations and Warranties: The Chargor represents and warrants to
Agent that:
22.1.1 the Chargor is the sole, absolute and beneficial owner of the
Charged Property, that no person save the Chargor has any right or
interest of any sort whatsoever in or to the Charged Property and
that there are no agreements or arrangements (including any
restrictions on transfer or rights of pre-emption) affecting the
Charged Property which would in any way fetter the rights of the
Chargor under this Share Charge;
22.1.2 the Securities are duly authorised, validly issued and fully paid
and there are no monies or liabilities outstanding in respect of
any of the Securities;
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22.1.3 the Securities constitute 100% of the entire issued ordinary share
capital of Subsidiary Borrower, and constitute 100% of all of the
shares in Subsidiary Borrower owned legally or beneficially by the
Chargor;
22.1.4 the transfer of the Securities or the charge over the Securities,
each as contemplated by this Share Charge, is not prohibited by
the constitutional documents of the Chargor;
22.1.5 the Chargor is validly incorporated under the laws of Ireland and
has the power and authority to enter into, perform and deliver
this Share Charge and the arrangements contemplated hereby;
22.1.6 this Share Charge constitutes its legal, valid and binding
obligations, enforceable in accordance with its terms except
enforcement may be limited by equitable principles or by
insolvency or similar laws relating to or limiting the rights of
creditors generally;
22.1.7 in any proceedings taken in its jurisdiction of incorporation in
relation to this Share Charge, the choice of the law of Ireland as
the governing law of this Share Charge and any judgment obtained
in Ireland will be recognised and enforced;
22.1.8 the Chargor has not taken any corporate action nor have any other
steps been taken or legal proceedings been started or (to the best
of its knowledge and belief) threatened against it for its
winding-up, dissolution, court protection or re-organisation or
for the appointment of a receiver, examiner, trustee or similar
officer of it or of any or all of its assets or revenues;
22.1.9 its execution of this Share Charge and exercise of its rights and
performance of its obligations hereunder will not result in the
existence of nor oblige it to create any Lien over all or any of
its present or future revenues or assets otherwise than as
contemplated hereby; and
22.1.10 its execution of this Share Charge constitutes, and its exercise
of its rights and performance of its obligations hereunder will
constitute, private and commercial acts done and performed for
private and commercial purposes.
22.2 Times of Making Representations and Warranties
The representations and warranties set out in Clause 22.1 (Representations
and Warranties):
22.2.1 will survive the execution of each Irish Loan Document and each
drawdown under the Loan Agreement; and
22.2.2 are made on the date hereof and are deemed to be repeated in
accordance with Section 3.3(a) (Conditions Precedent to all
Extensions of Credit) of the Loan Agreement with reference to the
facts and circumstances then existing.
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23 GOVERNING LAW AND SUBMISSION TO JURISDICTION
23.1 Governing Law:Any dispute, controversy, proceedings or claim of whatever
nature arising out of or relating to, or breach of, this Share Charge
shall be governed by and this Share Charge shall be construed in all
respects in accordance with the laws of Ireland.
23.2 Submission to Jurisdiction:
23.2.1 The Chargor irrevocably submits for the benefit of Agent to the
non-exclusive jurisdiction of the courts of Ireland for the
purpose of hearing and determining any proceedings arising out of
this Share Charge.
23.2.2 The Chargor hereby designates, appoints and empowers the Subsidary
Borrower at 25-28 North Wall Quay, Dublin 1 (or such other address
in Ireland as it may notify to Agent), marked for the attention of
the company secretary, as its process service agent to accept
service of process in Ireland in any proceedings, and agrees that
failure by such agent to give notice of such service of process to
the Chargor shall not impair or affect the validity of such
service or any judgment based on it. If the appointment ceases to
be effective in respect of the Chargor, the Chargor shall
immediately appoint a further person in Ireland to accept service
of process on its behalf in Ireland and, if it fails to make such
appointment within 15 days, Agent shall be entitled to appoint
such person by notice to the Chargor.
23.2.3 The Chargor irrevocably agrees not to claim that any such court is
not a convenient or appropriate forum and agrees that a judgment
in proceedings brought in such courts shall be conclusive and
binding upon them and may be enforced in any other jurisdiction.
23.3 Freedom of Choice:The submission to the jurisdiction of the courts
referred to in Clause 23.2 (Submission to Jurisdiction) shall not (and
shall not be construed so as to) limit the right of Agent to take
proceedings against the Chargor in the courts of any country in which the
Chargor has assets or in any other court of competent jurisdiction nor
shall the taking of proceedings in any one or more jurisdictions preclude
the taking of proceedings in any other jurisdiction (whether concurrently
or not) if and to the extent permitted by applicable law.
THIS SHARE CHARGE has been executed by the Chargor as a Deed and signed by Agent
but shall only be treated as having been executed and delivered to take effect
on the day and year first above written.
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FIRST SCHEDULE
100 ordinary shares of US$1 each held by the Chargor in Palm Global Operations
Limited.
SECOND SCHEDULE
The address of the Chargor for service of notice is
220 Wharfdale Road,
Wokingham,
Berkshire, RG41 5TB
Fax number: (44) 118 927 8791
For the attention of the Legal Department
With a copy to: Palm Inc.
5470 Great America Parkway
MS12106
Santa Clara CA95052
Fax number: 001 408 878 2790
For the attention of the General Counsel
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CHARGOR
PRESENT when the Common Seal of )
PALM IRELAND INVESTMENT )
(pursuant to a resolution of its board of ) /s/ Judy Bruner
directors) was affixed hereto: ) --------------------------
(Directorr)
/s/ Stephen Yu
--------------------------
(Director/Secretary)
AGENT
SIGNED by )
for and on behalf of )
FOOTHILL CAPITAL )
CORPORATION as Agent ) /s/ John Nocita
--------------------------
(Authorised Officer)
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