Exhibit 10.4
AMENDED AND RESTATED PLEDGE AGREEMENT
AMENDED AND RESTATED PLEDGE AGREEMENT dated April 16, 1999
made by ACCURIDE CORPORATION, a Delaware corporation (the "U.S. BORROWER"),
ACCURIDE CANADA INC., a corporation organized and existing under the laws of the
Province of Ontario (the "CANADIAN BORROWER"), and ACCURIDE VENTURES, INC., a
Delaware corporation ("ACCURIDE VENTURES") (together with the U.S. Borrower, the
Canadian Borrower and each of the Additional Pledgors (as defined in Section
18(b) below), collectively the "PLEDGORS" and each individually a "PLEDGOR"), to
CITICORP USA, INC. ("CUSA"), as administrative agent (the "ADMINISTRATIVE
AGENT") for the Lenders and the other Secured Parties (each as defined in the
Credit Agreement referred to below).
PRELIMINARY STATEMENTS:
(1) The U.S. Borrower and the Canadian Borrower entered into a
Pledge Agreement dated January 21, 1998 (the "ORIGINAL PLEDGE AGREEMENT") in
favor of the Administrative Agent, pursuant to which the U.S. Borrower pledged
the Initial Pledged Shares (as defined therein).
(2) The Lender Parties, the Administrative Agent, Salomon
Smith Barney Inc, as arranger, Bankers Trust Company, as syndication agent and
Wells Fargo Bank N.A., as documentation agent have entered into an Amended and
Restated Credit Agreement dated as of April 16, 1999 (said Amended and Restated
Credit Agreement, as it may hereafter be amended, supplemented or otherwise
modified from time to time, being the "CREDIT AGREEMENT"; the terms defined
therein and not otherwise defined herein being used herein as therein defined)
with the U.S. Borrower and the Canadian Borrower. Pursuant to the Original
Credit Agreement, the Term A Lenders made Term A Advances to the Canadian
Borrower, the Term B Lenders made Term B Advances to the U.S. Borrower, and the
Revolving Credit Lenders made Revolving Credit Advances to the U.S. Borrower, in
each case to finance, in part, the acquisition by the Investor Group of not less
than 90% of the outstanding shares of common stock of the U.S. Borrower pursuant
to the Stock Purchase Agreement and to pay transaction fees and expenses in
connection therewith and, in the case of Revolving Credit Advances, to provide
working capital for, and for the general corporate purposes of, the U.S.
Borrower and its Subsidiaries. Pursuant to the Credit Agreement, the Term C
Lenders will make Term C Advances to the U.S. Borrower to refinance debt
incurred by the U.S. Borrower in connection with the AKW Acquisition and to
prepay in part Revolving Credit Advances outstanding under the Original Credit
Agreement, and from time to time the Lender Parties will make Advances to and
issue Letters of Credit for the benefit of the U.S. Borrower in order to provide
working capital for the U.S. Borrower and its Subsidiaries.
(3) The Borrowers may have invested in, or may from time to
time hereafter invest in, Hedge Agreements with one or more Lenders to obtain
protection against fluctuations in the interest rates applicable to outstanding
Advances to the extent permitted by Section 5.02(b)(i)(B) of the Credit
Agreement (collectively, the "BANK HEDGE AGREEMENTS").
(4) Each Pledgor is the owner of the type, number and
percentage of the issued and outstanding shares of stock, limited liability
company membership interests, limited partnership interests and other equity
interests set forth opposite name of such Pledgor and described on Schedule I
hereto.
(5) (a) The U.S. Borrower has opened a cash collateral account
(the "U.S. BORROWER CASH COLLATERAL Account") with Citibank, N.A. ("CITIBANK")
at its offices at 399 Park --Avenue, New York, New York 10043, Account No.
4075-2223 and (b) the Canadian Borrower has opened a cash collateral account
(the "CANADIAN BORROWER CASH COLLATERAL ACCOUNT" and, together with the U.S.
Borrower Cash Collateral Account, the "CASH COLLATERAL ACCOUNTS") with Citibank
at its Affiliate's offices at 123 Front Street West, Toronto, Ontario, Canada,
Account No. 2/012752/027. Each of the Cash Collateral Accounts have been opened
in the name of applicable Borrower pursuant to, and for the purpose set forth in
Section 2.06(b)(vii) of the Credit Agreement and Section 15(e) of this
Agreement, and are under the sole and exclusive dominion and control of the
Administrative Agent and subject to the terms of this Agreement.
(6) It is a condition precedent to the effectiveness of the
Credit Agreement and the making of Term C Advances by the Term C Lenders under
the Credit Agreement that the Original Pledge Agreement shall be amended and
restated so that (i) the U.S. Borrower shall pledge hereunder, in addition to
the Initial Pledged Shares (as defined in the Original Pledge Agreement), its
50% limited liability company membership interest in AKW General Partner L.L.C.,
a Delaware limited liability company ("AKW LLC"), and its 49% limited
partnership interest in AKW L.P., a Delaware limited partnership ("AKW LP"), and
(ii) Accuride Ventures shall pledge hereunder its 50% limited liability company
membership interest in AKW LLC and its 49% limited partnership interest in AKW
LP.
NOW, THEREFORE, in consideration of the premises, each Pledgor
hereby agrees with the Administrative Agent for its benefit and the ratable
benefit of the Secured Parties as follows, and that the Original Pledge
Agreement is amended and restated in its entirety to read as follows:
SECTION 1. GRANT OF SECURITY1. GRANT OF SECURITY. Each Pledgor
hereby assigns and pledges to the Administrative Agent for its benefit and the
ratable benefit of the Secured Parties, and hereby grants to the Administrative
Agent for its benefit and the ratable benefit of the Secured Parties a security
interest in, the following (collectively, the "COLLATERAL"):
(a) all of the following (the "SECURITY COLLATERAL"):
(i) the shares of stock, limited liability company
membership interests, limited partnership interests and other
equity interests set forth opposite such Pledgor's name on
Schedule I hereto and issued by the Persons named therein
(such shares, limited liability company membership interests,
limited partnership interests and other equity interests being
collectively referred to herein as the "INITIAL PLEDGED
INTERESTS", and, together with the Additional Pledged
Interests referred to in clause (ii) below and the shares,
limited liability company membership interests, limited
partnership interests and other equity interests referred to
in clause (iii) below, the "PLEDGED INTERESTS"), whether or
not evidenced by certificates, and all certificates, if any,
representing Initial Pledged Interests and all dividends,
distributions, cash, instruments and other property and assets
from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the
Pledged Interests;
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(ii) the Additional Pledged Interests as defined and
described in each Pledge Agreement Supplement (as defined in
Section 18(b) hereof) executed by such Pledgor, whether or not
evidenced by certificates, and all certificates, if any,
representing such Pledged Interests and all dividends,
distributions, cash, instruments and other property and assets
from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of
such Additional Pledged Interests;
(iii) all additional shares of stock, limited
liability company membership interests, limited partnership
interests and other equity interests in any issuer or issuers
of Pledged Interests from time to time acquired by such
Pledgor in any manner, whether or not evidenced by
certificates, and all certificates, if any, representing such
Pledged Interests and all dividends, distributions, cash,
instruments and other property and assets from time to time
received, receivable or otherwise distributed in respect of or
in exchange for any or all of such shares; PROVIDED, HOWEVER,
that such Pledgor shall not be required to pledge any shares
of stock, limited liability company membership interests,
limited partnership interests or other equity interest owned
by it in any Foreign Subsidiary, other than the Canadian
Borrower (subject, however, to the PROVISO to Section 2
hereof), to the extent that such pledge, when aggregated with
all of the other shares, limited liability company membership
interests, limited partnership interests or other equity
interests in such Subsidiary pledged by such Pledgor and the
other Pledgors would result in more than 66% of the voting
shares, limited liability company membership interests,
limited partnership interests and other equity interests
(within the meaning of Treasury Regulation Section
1.956-2(c)(2) promulgated under the Internal Revenue Code)
(the "VOTING INTERESTS") being pledged to the Administrative
Agent on behalf of itself and the Secured Parties under this
Agreement; and PROVIDED FURTHER that if as a result of any
change in the tax laws of the United States after the date of
this Agreement, the pledge by such Pledgor of any additional
shares of stock, limited liability company membership
interests or limited partnership interests or other equity
interests in such Subsidiary would not result in an increase
in the aggregate net consolidated tax liabilities of the U.S.
Borrower and its Subsidiaries, then, promptly after the change
in such laws, such Pledgor shall pledge all such additional
shares of stock, limited liability company membership
interests or limited partnership interests and other equity
interests to the Administrative Agent under this Agreement;
and
(iv) all of the Debt from time to time owed to such
Pledgor (including, without limitation, such Pledgor that is
an Additional Pledgor) by any Person in an aggregate principal
amount in excess of $5,000,000 incurred in connection with a
transaction permitted by Section 5.02(d)(ii) of the Credit
Agreement, and all of the instruments evidencing such Debt,
all security therefor and all interest, cash, instruments and
other property and assets from time to time received,
receivable or otherwise distributed in respect of or in
exchange for any or all of such Debt;
(b) all of the following (collectively, the "ACCOUNT
COLLATERAL"):
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(i) in the case of the U.S. Borrower, the U.S.
Borrower Cash Collateral Account, all of the funds held
therein and all of the certificates and instruments, if any,
from time to time representing or evidencing the U.S. Borrower
Cash Collateral Account;
(ii) in the case of the Canadian Borrower, the
Canadian Borrower Cash Collateral Account, all of the funds
held therein and all of the certificates and instruments, if
any, from time to time representing or evidencing the Canadian
Borrower Cash Collateral Account;
(iii) all of the Collateral Investments (as defined
in Section 5(b)) made on behalf of such Pledgor from time to
time and all of the certificates and instruments, if any, from
time to time representing or evidencing any of the Collateral
Investments made on behalf of such Pledgor;
(iv) all of the notes, certificates of deposit,
deposit accounts, checks and other instruments from time to
time hereafter delivered to or otherwise possessed by the
Administrative Agent for or on behalf of such Pledgor in
respect of or in exchange for any or all of the then existing
Account Collateral; and
(v) all of the interest, dividends, distributions,
cash, instruments and other property and assets from time to
time received, receivable or otherwise distributed in respect
of or in exchange for any or all of the then existing Account
Collateral; and
(c) all of such Pledgor's right, title and interest, whether
now owned or hereafter acquired, in the AKW LP Agreement and the AKW
LLC Agreement, in each case as such agreement may be amended,
supplemented or otherwise modified from time to time (collectively, the
"ASSIGNED AGREEMENTS"), including, without limitation, whether now
existing or hereafter acquired or arising, (i) all rights of such
Pledgor to receive monies and other property or assets due and to
become due to such Pledgor under or pursuant to any of the Assigned
Agreements, (ii) all claims of such Pledgor for damages arising out of
or default under any Assigned Agreement, (iii) all rights of such
Pledgor to receive proceeds of any insurance, indemnity, warranty or
guaranty with respect to any Assigned Agreement, (iv) all rights of
such Pledgor to perform under any Assigned Agreement and to receive and
compel performance and otherwise exercise all remedies thereunder and
(v) any and all other rights, interests and claims of such Pledgor
under, relating to or arising in connection with the Assigned
Agreements; and
(d) all proceeds of any and all of the foregoing Collateral
(including, without limitation, proceeds that constitute property of
the types described in clauses (a) through (c) of this Section 1).
SECTION 2. SECURITY FOR OBLIGATIONS2. SECURITY FOR
OBLIGATIONS. The pledge and assignment of and the grant of a security interest
in the Collateral by each Pledgor under this Agreement secure the payment of all
Obligations of such Pledgor now or hereafter existing under the
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Loan Documents, whether for principal, interest, fees, indemnities, costs,
expenses or otherwise (all such Obligations being the "SECURED OBLIGATIONS" of
such Pledgor); PROVIDED, HOWEVER, that the pledge and assignment by the U.S.
Borrower of and the grant by the U.S. Borrower of a security interest in the
Pledged Interests issued by the Canadian Borrower shall be limited as follows:
(i) the pledge and assignment of and the grant of a security interest in 66%,
and only 66%, of such Pledged Interests secure the payment of the Obligations of
the U.S. Borrower now or hereafter existing under the Loan Documents other than
the Obligations of the U.S. Borrower under the Guaranty and (ii) the pledge and
assignment of and the grant of a security interest in 100% of such Pledged
Interests secure the payment by the U.S. Borrower pursuant to the Guaranty of
the Guaranteed Obligations of the Canadian Borrower now or hereafter existing
under the Loan Documents.
SECTION 3. DELIVERY OF SECURITY COLLATERAL AND ACCOUNT
COLLATERAL; CONSENT TO PLEDGE3. DELIVERY OF SECURITY COLLATERAL AND ACCOUNT
COLLATERAL; CONSENT TO PLEDGE. (a) All certificates or instruments representing
or evidencing Security Collateral and the Account Collateral shall be delivered
to and held by or on behalf of the Administrative Agent pursuant hereto and
shall be in suitable form for transfer by delivery, or shall be accompanied by
duly executed instruments of transfer or assignment in blank, all in form and
substance reasonably satisfactory to the Administrative Agent. Each Pledgor
shall, in respect of each Pledged Interest pledged by it hereunder and not
evidenced by a certificate or instrument, deliver to the Administrative Agent
(i) an assignment in blank referred to in Section 3.04(b)(viii)(A) of the Credit
Agreement with respect to such Pledged Interest and (ii) financing statements
referred to in Section 3.04(b)(viii)(B) of the Credit Agreement covering such
Pledged Interest. The Administrative Agent shall have the right, at any time
upon the occurrence and continuance of a Default under Section 7.01(a) or (f) of
the Credit Agreement or upon the occurrence of an Event of Default, in its sole
discretion and without notice to any Pledgor, to transfer to or to register in
the name of the Administrative Agent or any of its nominees any or all of the
Security Collateral or the Account Collateral, subject only to the revocable
rights specified in Section 10(a). In addition, the Administrative Agent shall
have the right at any time to exchange certificates or instruments representing
or evidencing Security Collateral or the Account Collateral for certificates or
instruments of smaller or larger denominations.
(b) In the case of the Pledged Interests of the Canadian
Borrower, the U.S. Borrower hereby agrees to deliver or cause to be delivered to
the Administrative Agent any consent required under the articles of
incorporation of the Canadian Borrower to the transfer of the Pledged Interests
of the Canadian Borrower to the Administrative Agent effected by Section 1(a)
hereof, concurrently with the delivery of duly executed instruments of transfer
or assignment in blank in respect of such Pledged Interests in accordance with
Section 3(a).
(c) Each Pledgor shall (i) cause each of the issuers of the
Pledged Interests owned by such Pledgor not to issue any shares of stock,
limited liability company membership interests, limited partnership interests or
other equity interests in addition to or in substitution for the Pledged
Interests except to such Pledgor, and (ii) deliver or otherwise transfer to the
Administrative Agent hereunder pursuant to subsections (a) and (b) above,
immediately upon its acquisition (directly or indirectly) thereof, any and all
additional shares of stock, limited liability company membership interests,
limited partnership interests or other equity interests of each of such issuers,
subject to the PROVISOS contained in Section 1(a)(iii) of this Agreement.
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(d) The U.S. Borrower and Accuride Ventures, as members of AKW
LLC and limited partners of AKW LP, hereby (i) consent, for purposes of Article
9 of the AKW LLC Agreement and Article 9 of the AKW LP Agreement, to the
assignment and pledge hereunder of, and the grant hereunder of security
interests in, the Pledged Interests issued by AKW LLC and AKW LP and to the
assignment, sale or other disposition of such Pledged Interests pursuant to
Section 15 hereof and the transferee of such assignment, sale or other
disposition becoming a Substituted Member under the AKW LLC Agreement and a
Substituted Limited Partner under the AKW LP Agreement and (ii) agree that the
provisions of Sections 9.2 through 9.6 of the AKW LLC Agreement and Sections 9.2
through 9.6 of the AKW LP Agreement shall not apply to the assignment or pledge
hereunder of, or the grant hereunder of security interests in, the Pledged
Interests issued by AKW LLC and AKW LP, or the assignment, sale or other
disposition of such Pledged Interests pursuant to Section 15 hereof, and in that
connection waive all of their rights under such provisions with respect to such
assignment, pledge and grant and such assignment, sale and other disposition.
SECTION 4. ESTABLISHMENT AND MAINTENANCE OF THE CASH
COLLATERAL ACCOUNTS4. ESTABLISHMENT AND MAINTENANCE OF THE CASH COLLATERAL
ACCOUNTS. So long as any of the Advances shall remain unpaid, any Letter of
Credit shall be outstanding or any of the Lender Parties shall have any
Commitment under the Credit Agreement:
(a) Each of the Borrowers will maintain its Cash Collateral
Account with Citibank in accordance with the terms of this Agreement
and the letter agreement dated the Closing Date (each, a "CASH
COLLATERAL ACCOUNT LETTER") among such Borrower, Citibank and the
Administrative Agent, which agreement is in substantially the form of
Exhibit A hereto or otherwise in form and substance reasonably
satisfactory to the Administrative Agent. The Administrative Agent
shall have sole and exclusive dominion and control of each of the Cash
Collateral Accounts subject to the terms of this Agreement.
(b) It shall be a term and condition of each of the Cash
Collateral Accounts, notwithstanding any term or condition to the
contrary in any other agreement relating to such Cash Collateral
Account, that no amount (including, without limitation, interest on
Collateral Investments related thereto) shall be paid or released to or
for the account of, or withdrawn by or for the account of, any of the
Pledgors or any other Person from such Cash Collateral Account, except
as otherwise provided in Sections 6 and 15.
Each of the Cash Collateral Accounts shall be subject to such applicable laws
(including, without limitation, such applicable regulations of the Board of
Governors of the Federal Reserve System and of any other appropriate banking
authority or other governmental authority) as are in effect from time to time.
SECTION 5. INVESTING OF AMOUNTS IN THE CASH COLLATERAL
ACCOUNTS5. INVESTING OF AMOUNTS IN THE CASH COLLATERAL ACCOUNTS. (a) If
requested by the applicable Borrower, the Administrative Agent will, subject to
the provisions of Sections 6 and 15, from time to time, so long as no Default
under Section 7.01(a) or 7.01(f) of the Credit Agreement or Event of Default has
occurred and is continuing, (i) invest amounts on deposit in the Cash Collateral
Account of such Borrower in
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such Cash Equivalents as such Borrower may select, in each case which
investments shall be made in the name of, and with the entitlement holder being,
the Administrative Agent, on behalf of such Borrower, and (ii) invest interest
paid on the Cash Equivalents referred to in clause (i) above, and reinvest other
proceeds of any such Cash Equivalents that may mature or be sold, in each case
in such Cash Equivalents as such Borrower may select, in each case which
investments shall be made in the name of, and with the entitlement holder being,
the Administrative Agent, on behalf of such Borrower (the Cash Equivalents
referred to in clauses (i) and (ii) of this Section 5(a) being, collectively,
the "BORROWERS' COLLATERAL INVESTMENTS").
(b) Upon the occurrence and during the continuance of a
Default under Section 7.01(a) or 7.01(f) of the Credit Agreement or an Event of
Default, the Administrative Agent may, subject to the provisions of Section 15,
from time to time (i) invest amounts on deposit in each of the Cash Collateral
Accounts, and any cash proceeds collected by or on behalf of the Administrative
Agent and held pursuant to Section 15(e), in such Cash Equivalents as the
Administrative Agent may select, in each case which investments shall be made in
the name of, and with the entitlement holder being, the Administrative Agent, on
behalf of the applicable Pledgors, and (ii) invest interest paid on the Cash
Equivalents referred to in clause (i) above, and reinvest other proceeds of any
such Cash Equivalents that may mature or be sold, in such Cash Equivalents as
the Administrative Agent may select, in each case which investments shall be
made in the name of, and with the entitlement holder being, the Administrative
Agent, on behalf of the applicable Pledgors (the Cash Equivalents referred to in
clauses (i) and (ii) of this Section 5(b), together with the Borrowers
Collateral Investments, being, collectively, the "COLLATERAL INVESTMENTS").
(c) Interest and proceeds that are not invested or reinvested
in Collateral Investments as provided in subsection (a) or (b) of this Section 5
shall be deposited and held in the applicable Cash Collateral Account.
(d) The Administrative Agent shall not have any liability to
any of the Pledgors or any of the other Secured Parties for, or as a result of,
any losses suffered from any Collateral Investment made by it in accordance with
this Section 5 or if the earnings realized on any such Collateral Investment are
less than otherwise could have been achieved had other Cash Equivalents been
selected by the Borrowers or the Administrative Agent pursuant to the terms of
subsection (a) or (b), respectively, of this Section 5.
(e) All of the Collateral Investments made in respect of the
Cash Collateral Accounts and all interest and income received thereon and
therefrom, and the net proceeds realized upon the maturity or sale thereof,
shall be held in the applicable Cash Collateral Account as Account Collateral,
which amounts may be released solely in accordance with the provisions of
Sections 6 and 15.
SECTION 6. RELEASE OF AMOUNTSSECTION 6. RELEASE OF AMOUNTS.
The Administrative Agent is hereby authorized, without any further action by or
notice to or from any of the Borrowers, to maintain any amounts deposited into
the Cash Collateral Account of any such Borrower pursuant to Section
2.06(b)(vii) of the Credit Agreement until the last day of the Interest Period
then in effect for any outstanding Eurodollar Rate Advances and, on such last
day, to pay and
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release such amounts from such Cash Collateral Account for the prepayment to
each of the Appropriate Lenders (other than the Declining Lenders) of the
Eurodollar Rate Advances outstanding on such day in accordance with Section
2.06(b) of the Credit Agreement, with any excess amounts in such Cash Collateral
Account to be transmitted to the account designated by the applicable Borrower.
SECTION 7. REPRESENTATIONS AND WARRANTIES7. REPRESENTATIONS
AND WARRANTIES. Each Pledgor represents and warrants as follows:
(a) The chief executive office of such Pledgor and the office
where such Pledgor keeps its records concerning the Collateral is
located at the address set forth beneath the name of such Pledgor on
the signature pages hereof (or, in the case of any Additional Pledgors
at the address set forth below the name of such Additional Pledgor on
the signature page of the Pledge Agreement Supplement (as defined in
Section 18(b) below)).
(b) Such Pledgor is the sole legal and beneficial owner of the
Collateral pledged by such Pledgor hereunder, free and clear of any
Lien, except for the security interest created by this Agreement. No
effective financing statement or other instrument similar in effect
covering all or any part of the Collateral is on file in any recording
office, except such as may have been filed in favor of the
Administrative Agent relating to this Agreement or as otherwise
permitted under Section 5.02(a) of the Credit Agreement.
(c) The Pledged Interests owned by such Pledgor have been duly
authorized and validly issued and, to the extent such Pledged Interests
constitute shares of stock, are fully paid and non-assessable, and, in
the case of such Pledged Interests issued by AKW LLC and AKW LP, are
not represented by certificates.
(d) The Pledged Interests owned by such Pledgor constitute the
percentage of the issued outstanding shares of stock, limited liability
company membership interests and limited partnership interests, as the
case may be, of the issuers thereof indicated on Schedule I hereto.
(e) This Agreement, and the delivery of and other actions
taken with respect to the Security Collateral pursuant to Section 3
(including, without limitation, the proper filing of the financing
statements referred to therein with respect to the Pledged Interests
issued by AKW LLC and AKW LP, under the Uniform Commercial Code of the
applicable jurisdiction), create a valid and perfected first priority
security interest in the Collateral pledged by such Pledgor hereunder,
securing the payment of the Secured Obligations of such Pledgor, and
all filings and other actions necessary to perfect such security
interest have been duly taken and are in full force and effect or will
be made or taken in accordance with the terms of the Loan Documents,
and all filing and recording fees and taxes related to any of the
foregoing have been or will upon each filing be duly paid in full.
(f) No consent of any other Person and no authorization,
approval or other action by, and no notice to or filing with, any
governmental authority or regulatory body or other third party is
required either (i) for the grant by such Pledgor of the security
interest in the Collateral granted hereby or for the execution,
delivery or performance of this Agreement by such Pledgor, (ii) for the
perfection of the security interest in the Collateral granted by such
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Pledgor hereunder (including the first priority nature of such pledge,
assignment or security interest) or (iii) for the exercise by the
Administrative Agent of any voting or other rights provided for in this
Agreement or the remedies in respect of the Collateral pursuant to this
Agreement, except as may be required in connection with the disposition
of any portion of the Security Collateral by laws affecting the
offering and sale of securities generally.
SECTION 8. FURTHER ASSURANCES8. FURTHER ASSURANCES. (a) Each
of the Pledgors agrees from time to time, at its sole expense, to promptly
execute and deliver all further instruments and documents, and take all further
action, that may be necessary or desirable, or that the Administrative Agent may
reasonably request, in order to perfect and protect any pledge, assignment or
security interest granted or purported to be granted hereby or to enable the
Administrative Agent to exercise and enforce its rights and remedies hereunder
with respect to any Collateral. Without limiting the generality of the
foregoing, each Pledgor will: (i) mark at the request of the Administrative
Agent, each of its records pertaining to the Collateral with a legend, in form
and substance satisfactory to the Administrative Agent, indicating that such
Collateral is subject to the security interest granted hereby; (ii) if any
Collateral shall be evidenced by a promissory note or other instrument, deliver
and pledge to the Administrative Agent hereunder such note or instrument duly
indorsed and accompanied by duly executed instruments of transfer or assignment,
all in form and substance satisfactory to the Administrative Agent; and (iii)
execute and file such financing or continuation statements, or amendments
thereto, and such other instruments or notices, as may be necessary or
desirable, or as the Administrative Agent may reasonably request, in order to
perfect and preserve the pledge, assignment and security interest granted or
purported to be granted hereby.
(b) Each Pledgor hereby authorizes the Administrative Agent to
file one or more financing or continuation statements, and amendments thereto,
relating to all or any part of the Collateral without the signature of such
Pledgor where permitted by law. A photocopy or other reproduction of this
Agreement or any financing statement covering the Collateral or any part thereof
shall be sufficient as a financing statement where permitted by law.
(c) Each Pledgor will furnish to the Administrative Agent from
time to time statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as the
Administrative Agent may reasonably request, all in reasonable detail.
SECTION 9. PLACE OF PERFECTION; RECORDS9. PLACE OF PERFECTION;
RECORDS. Each Pledgor shall keep its chief executive office and the office where
it keeps its records concerning the Collateral at the location therefor
specified in Section 7(a) or, upon 30 days' prior written notice to the
Administrative Agent, at such other locations in a jurisdiction where all
actions required by Section 8 shall have been taken with respect to the
Collateral. Each Pledgor will hold and preserve such records and will permit
representatives of the Administrative Agent at any time during normal business
hours upon reasonable notice to inspect and make abstracts from such records.
SECTION 10. VOTING RIGHTS; DIVIDENDS; ETC10. VOTING RIGHTS;
DIVIDENDS; ETC. (a) So long as no Default under Section 7.01(a) or (f) of the
Credit Agreement shall have occurred and be continuing or no Event of Default
shall have occurred and be continuing:
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(i) Each Pledgor shall be entitled to exercise any and all
voting and other consensual rights pertaining to the Security
Collateral or any part thereof for any purpose not inconsistent with
the terms of this Agreement or the other Loan Documents; PROVIDED,
HOWEVER, that such Pledgor shall not exercise or refrain from
exercising any such right if such action would have a Material Adverse
Effect on the value of the Security Collateral or any part thereof.
(ii) The Administrative Agent shall execute and deliver (or
cause to be executed and delivered) to each Pledgor all such proxies
and other instruments as such Pledgor may reasonably request for the
purpose of enabling such Pledgor to exercise the voting and other
rights that it is entitled to exercise pursuant to paragraph (i) above.
(iii) Each Pledgor shall be entitled to receive and retain any
and all dividends, interest and other distributions paid or other
amounts received in respect of its Security Collateral, PROVIDED,
HOWEVER, that:
(A) any and all dividends and other distributions paid or
payable other than in cash in respect of, and instruments and other
property received, receivable or otherwise distributed in respect of,
or in exchange for, any Security Collateral except that the foregoing
shall not apply to a liquidation of AKW LP or AKW LLC into a Restricted
Subsidiary of the U.S. Borrower so long as all of the stock, limited
liability company membership interests, limited partnership interests
or other equity interests of such Restricted Subsidiary is pledged
under this Agreement,
(B) any and all dividends and other distributions paid or
payable in cash in respect of any Security Collateral in connection
with a partial or total liquidation or dissolution or in connection
with a reduction of capital, capital surplus or paid-in-surplus,
(C) any and all cash paid, payable or otherwise distributed in
redemption of, or in exchange for, any Security Collateral, and
(D) any and all dividends and distributions paid in cash in
violation of the terms of the Credit Agreement,
shall be, and shall be forthwith delivered to the Administrative Agent
to hold as, Security Collateral and shall, if received by any Pledgor,
be received in trust for the benefit of the Administrative Agent, be
segregated from the other property or funds of such Pledgor and be
forthwith delivered to the Administrative Agent as Security Collateral
in the same form as so received (with any necessary indorsement or
assignment).
(b) Upon notice to the U.S. Borrower by the Administrative
Agent following the occurrence and during the continuance of a Default under
Section 7.01(a) or (f) of the Credit Agreement or an Event of Default, all
rights of the Pledgors to exercise or refrain from exercising the voting and
other consensual rights that it would otherwise be entitled to exercise pursuant
to
10
Section 10(a)(i) and all rights of the Pledgors to receive dividends and other
distributions that it would otherwise be entitled to receive pursuant to Section
10(a)(iii) shall cease, and all such rights shall thereupon become vested in the
Administrative Agent, which shall thereupon have the sole right to exercise or
refrain from exercising such voting and other consensual rights or to receive or
refrain from receiving such dividends and other distributions.
SECTION 11. TRANSFERS AND OTHER LIENS11. TRANSFERS AND OTHER
LIENS. No Pledgor shall (i) convey, transfer, sell, assign (by operation of law
or otherwise) or otherwise dispose of, or grant any option or other right to
purchase or otherwise acquire, any of the Collateral, except for such
conveyances, sales, transfers, assignments and dispositions that are expressly
permitted under the Loan Documents, or (ii) create, incur, assume or suffer to
exist any Lien upon or with respect to any of the Collateral except for the
pledge, assignment and security interest created or otherwise expressly
permitted under the terms of the Loan Documents.
SECTION 12. ADMINISTRATIVE AGENT APPOINTED ATTORNEY-IN-FACT12.
ADMINISTRATIVE AGENT APPOINTED Attorney-in-Fact. Each Pledgor hereby irrevocably
appoints the Administrative Agent such Pledgor's attorney-in-fact, with full
authority in the place and stead of such Pledgor and in the name of such Pledgor
or otherwise, from time to time in the Administrative Agent's discretion
following the occurrence and continuance of a Default under Section 7.01(a) or
7.01(f) or an Event of Default, to take any action and to execute any instrument
that the Administrative Agent may deem necessary or advisable to accomplish the
purposes of this Agreement and the other Loan Documents, including, without
limitation:
(a) to ask for, demand, collect, sue for, recover, compromise,
receive and give acquittance and receipts for moneys due and to become
due under or in respect of any of the Collateral,
(b) to receive, indorse, assign and collect any drafts,
acceptances, instruments and other documents in connection with this
Agreement (including, without limitation, all instruments representing
or evidencing any dividend or other distribution in respect of the
Collateral or any part thereof) and give full discharge to same,
(c) to sell, transfer, assign or otherwise deal with the
Collateral or any part thereof in the same manner and to the same
extent as if the Administrative Agent were the absolute owner thereof,
(d) (i) to direct any Person liable to such Pledgor for any
payment with respect to its Collateral to make payment of any and all
moneys due and to become due thereunder directly to the Administrative
Agent or as the Administrative Agent shall direct, (ii) to receive
payment of and receipt for any and all moneys, claims and other amounts
due and to become due at any time in respect of or arising out of any
of its Collateral, (iii) to defend any action, suit or proceeding
brought against such Pledgor with respect to any of its Collateral and
(iv) to settle, compromise or adjust any action, suit or proceeding
described in clause (iii) of this Section 12(d) and, in connection
therewith, to give any such discharge or release as the Administrative
Agent may deem appropriate,
11
(e) to file any application, petition or other request with
any governmental authority for the purpose of obtaining any consent,
approval or authorization therefrom or satisfying any registration,
filing, notice or other requirement thereof necessary in order to fully
and properly effect the sale, transfer or other disposition of any or
all of its Collateral, and
(f) to file any claims or take any action or institute any
proceedings at the sole expense of such Pledgor that the Administrative
Agent may deem necessary or desirable for the collection of any of the
Collateral or otherwise to enforce the rights of the Administrative
Agent with respect to any of the Collateral.
SECTION 13. ADMINISTRATIVE AGENT MAY PERFORM13. ADMINISTRATIVE
AGENT MAY PERFORM. If the Borrower fails to perform any agreement contained
herein, the Administrative Agent may itself perform, or cause performance of,
such agreement, and the expenses of the Administrative Agent incurred in
connection therewith shall be payable by the Borrower under Section 17(b).
SECTION 14. THE ADMINISTRATIVE AGENT'S DUTIES14. THE
ADMINISTRATIVE AGENT'S DUTIES. The powers conferred to the Administrative Agent
hereunder are solely to protect its interest (and the interest of the other
Secured Parties) in the Collateral and shall not impose any duty upon it to
exercise any such powers. Except for the safe custody of any Collateral in its
possession and the accounting for moneys actually received by it hereunder and
to dispose of the Collateral in a commercially reasonable manner, the
Administrative Agent shall have no duty as to any Collateral, as to ascertaining
or taking action with respect to calls, conversions, exchanges, maturities,
tenders or other matters relative to any Security Collateral, whether or not the
Administrative Agent or any Lender has or is deemed to have knowledge of such
matters, or as to the taking of any necessary steps to preserve rights against
any parties or any other rights pertaining to any Collateral. The Administrative
Agent shall be deemed to have exercised reasonable care in the custody and
preservation of any Collateral in its possession if such Collateral is accorded
treatment substantially equal to that which the Administrative Agent accords its
own property.
SECTION 15. REMEDIES15. REMEDIES. If any Event of Default
shall have occurred and be continuing:
(a) The Administrative Agent may exercise in respect of the
Collateral, in addition to other rights and remedies provided for
herein or otherwise available to it, all the rights and remedies of a
secured party upon default under the Uniform Commercial Code in effect
in the State of New York at such time (the "N.Y. UNIFORM COMMERCIAL
CODE") (whether or not the N.Y. Uniform Commercial Code applies to the
affected Collateral) and also may (i) without notice except as
specified below, sell the Collateral or any part thereof in one or more
parcels at public or private sale, at any of the Administrative Agent's
offices or elsewhere, for cash, on credit or for future delivery, and
upon such other terms as the Administrative Agent may deem commercially
reasonable, and (ii) notify each Pledgor that all of its rights to
exercise or refrain from exercising the voting and other consensual
rights that it would otherwise be entitled to exercise with respect to
the Collateral pursuant to Section 10(a)(i) shall cease and, upon such
notice, all such rights shall become vested in the Administrative
Agent, who shall thereupon
12
have the sole right to exercise or refrain from exercising such voting
and other consensual rights. Each Pledgor agrees that, to the extent
notice of sale shall be required by law, at least ten days' notice to
such Pledgor of the time and place of any public sale or the time after
which any private sale is to be made shall constitute reasonable
notification. The Administrative Agent shall not be obligated to make
any sale of Collateral regardless of notice of sale having been given.
The Administrative Agent may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and
such sale may, without further notice, be made at the time and place to
which it was so adjourned.
(b) If the Administrative Agent proceeds to exercise its right
to sell any or all of the Security Collateral, each of the Pledgors
shall, upon the written request of the Administrative Agent therefor,
furnish to the Administrative Agent all such information as the
Administrative Agent may reasonably request in order to determine the
number of limited liability company membership interests, limited
partnership interests, shares and other instruments included in such
Security Collateral that may be sold by the Administrative Agent in
transactions exempt under the Securities Act of 1933 (as amended, and
together with the regulations promulgated and the rulings issued
thereunder, the "SECURITIES ACT") or any similar laws in effect from
time to time in any other relevant jurisdiction.
(c) Each purchaser of all or any part of the Collateral at any
such sale that has been made in accordance with applicable law shall
hold the property sold absolutely free from any claim, encumbrance or
other right on the part of each of the Pledgors, and each of the
Pledgors hereby waives, to the fullest extent permitted by applicable
law, all rights of redemption, stay and/or appraisal that it now has or
may at any time in the future have under any applicable law now
existing or hereafter enacted with respect to any such sale.
(d) All proofs of claim, rights of action and rights to assert
claims under this Agreement or any of the other Collateral Documents to
which any Pledgor is or is to be a party may be enforced by the
Administrative Agent without the possession of any of the Notes at any
proceeding instituted by the Administrative Agent, and any such
proceeding may be brought in its own name as agent, and any recovery or
judgment shall be for the benefit of the Secured Parties. In any
proceeding brought by the Administrative Agent (and in any proceeding
involving the interpretation of any of the provisions of any of the
Collateral Documents to which such Pledgor is a party), the
Administrative Agent shall be held to represent all of the Secured
Parties, and it shall not be necessary to make any of the other Secured
Parties party to such proceeding.
(e) All cash held by or on behalf of the Administrative Agent
as Collateral and all cash proceeds received by or on behalf of the
Administrative Agent in respect of any sale of, collection from, or
other realization upon all or any part of the Collateral may, in the
discretion of the Administrative Agent, be held by the Administrative
Agent as collateral for, and/or then or at any time thereafter applied
(after payment of any amounts payable to the Administrative Agent
pursuant to Section 17(b)) in whole or in part by the Administrative
Agent, for the ratable benefit of the Secured Parties, against all or
any part of the Secured Obligations in such order as the Administrative
Agent shall elect. In determining the amounts owing to the Hedge
13
Banks under the Bank Hedge Agreements, the Administrative Agent shall
be entitled to rely, and be fully protected in relying, upon the
Agreement Values (as hereinafter defined) of the Bank Hedge Agreements.
The term "Agreement Value" means, with respect to any of the Bank Hedge
Agreements at any date of determination, the amount, if any, that would
be payable to the Hedge Bank party to such Bank Hedge Agreement in
respect of any "AGREEMENT VALUE" under such Bank Hedge Agreement if
such Bank Hedge Agreement were terminated on such date, calculated as
provided in the International Swap Dealers Association, Inc. Code of
Standard Wording, Assumptions and Provisions for Swaps, 1986 Edition.
Each determination of the Agreement Value of any of the Bank Hedge
Agreements shall be made by the Administrative Agent in good faith and
in reliance on any information (including information provided by such
Hedge Bank) that it believes to be accurate, but without any obligation
to verify such information. Any surplus of cash or cash proceeds held
by or on behalf of the Administrative Agent in accordance with this
Section 15 and remaining after payment in full in cash of all of the
Secured Obligations and all of the other Obligations of the Loan
Parties owing under or in respect of the Loan Documents shall be paid
over to the Pledgors or to whomsoever may be lawfully entitled to
receive such surplus.
(f) The Administrative Agent may exercise any and all rights
and remedies of any of the Pledgors in respect of the Collateral
(including, without limitation, any and all rights of any such Pledgor
to demand or otherwise require payment of any amount under, or
performance of any provision of any Collateral).
(g) Except as otherwise permitted by this Agreement, all
payments received by any of the Pledgors under, in connection with, or
in respect of, any of the Collateral shall be received and held by such
Pledgor in trust for the benefit of the Administrative Agent, shall be
segregated from the other property and funds of such Pledgor and shall
be delivered forthwith to the Administrative Agent in the same form as
so received (with any necessary endorsement or assignment).
SECTION 16. ACKNOWLEDGMENTS RELATING TO SECURITY COLLATERAL
AND ACCOUNT COLLATERAL16. ACKNOWLEDGMENTS RELATING TO SECURITY COLLATERAL AND
ACCOUNT COLLATERAL. (a) Each Pledgor recognizes and hereby acknowledges that, by
reason of certain prohibitions contained in the Securities Act and applicable
state securities laws (or other similar laws of other relevant jurisdictions),
the Administrative Agent may be compelled with respect to any sale of all or any
part of the Security Collateral comprised of limited liability company
membership interests, limited partnership interests, shares or other equity
interests or other securities that are not registered under the Securities Act
to limit the purchasers thereof to those Persons who will agree, among other
things, to acquire the Security Collateral for their own account, for investment
and not with a view to the distribution or resale thereof. Each Pledgor hereby
further acknowledges that any such private sale may be at a price and on terms
less favorable to the Administrative Agent and the other Secured Parties than
those obtainable through a public sale without such restrictions (including,
without limitation, a public offering made pursuant to a registration statement
under the Securities Act) and, notwithstanding such circumstances, such Pledgor
hereby agrees that any private sale shall be deemed to have been made in a
commercially reasonable manner and that the Administrative Agent shall have no
obligation to engage in public sales and no obligation to delay the sale of any
Security Collateral for the period of time
14
necessary to permit the issuer thereof to register it for a form of public sale
requiring registration under the Securities Act or any applicable state
securities laws (or other similar law of other relevant jurisdictions), even if
such Pledgor would agree to do so. Each Pledgor hereby waives any claims against
the Administrative Agent arising by reason of the fact that the price at which
any Security Collateral may have been sold at such a private sale was less than
the price that might have been obtained at a public sale, even if the
Administrative Agent accepts the first offer received and does not offer such
Security Collateral to more than one offeree.
(b) The Administrative Agent may sell or liquidate (and each
of the Borrowers hereby irrevocably instructs the Administrative Agent, without
any further action by or notice to or from any such Pledgor, to so sell or
liquidate) all or any portion of the Collateral Investments held in or in
respect of any of the Cash Collateral Accounts at any time following the
occurrence and during the continuance of an Event of Default that the proceeds
thereof are determined to be required for the satisfaction of all or any part of
the Secured Obligations, and the Administrative Agent shall not have any
liability to any of the Pledgors, any of the other Secured Parties or any other
Person for, or as a result of, any losses suffered from any such sale or
liquidation.
SECTION 17. INDEMNITY AND EXPENSES17. INDEMNITY AND EXPENSES.
(a) Without limiting any of the provisions of Section 9.04 of the Credit
Agreement, each Pledgor agrees to indemnify the Administrative Agent from and
against any and all claims, damages, expenses, losses and liabilities growing
out of or resulting from this Agreement (including, without limitation,
enforcement of this Agreement), except claims, damages, expenses, losses or
liabilities resulting from the Administrative Agent's gross negligence or
willful misconduct as determined by a final, non-appealable judgment of a court
of competent jurisdiction.
(b) Without limiting any of the provisions of Section 9.04 of
the Credit Agreement, each Pledgor will upon demand pay to the Administrative
Agent the amount of any and all reasonable expenses, including the reasonable
fees and expenses of its counsel and of any experts and agents, that the
Administrative Agent may incur in connection with (i) the administration of this
Agreement, (ii) the custody, preservation, use or operation of, or the sale of,
collection from or other realization upon, any of the Collateral, (iii) the
exercise or enforcement of any of the rights of the Administrative Agent or the
Lenders hereunder or (iv) the failure by such Pledgor to perform or observe any
of the provisions hereof.
(c) Without prejudice to the survival of any of the other
agreements of any of the Pledgors under this Agreement or any of the other Loan
Documents, the agreements and obligations of each of the Pledgors contained in
this Section 17 and in Section 22 shall survive the payment in full of all of
the Secured Obligations and all of the other Obligations of any of the Pledgors
owing under or in respect of the Loan Documents.
SECTION 18. AMENDMENTS; WAIVERS; PLEDGE AGREEMENT SUPPLEMENT;
ETC18. AMENDMENTS; WAIVERS; PLEDGE AGREEMENT SUPPLEMENT; ETC. (a) No amendment
or waiver of any provision of this Agreement, and no consent to any departure by
any Pledgor herefrom, shall in any event be effective unless the same shall be
in writing and signed by the Administrative Agent, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. No failure on the part of the Administrative Agent to
exercise, and no delay
15
in exercising, any right hereunder shall operate as a waiver thereof; nor shall
any single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right.
(b) Upon the execution and delivery by any Person of a
supplement to this Agreement (whether pursuant to Section 5.01(k) of the Credit
Agreement or otherwise), in each case in substantially the form of Exhibit B
hereto (each, a "PLEDGE AGREEMENT SUPPLEMENT"), (i) such Person, if it is not
then a Pledgor hereunder, shall be referred to as an "ADDITIONAL PLEDGOR" and
shall be and become a Pledgor, and each reference in this Agreement to an
"Additional Pledgor" or a "Pledgor" shall also mean and be a reference to such
Additional Pledgor and each reference in any of the other Loan Documents to a
"Pledgor" or a "Loan Party" shall also mean and be a reference to such
Additional Pledgor, (ii) the supplements attached to each of the Pledge
Agreement Supplements shall be incorporated into and become a part of and
supplement the Schedules to this Agreement, as appropriate, and the
Administrative Agent may attach such supplements to such Schedules, and each
reference to such Schedules shall mean and be a reference to such Schedules, as
supplemented pursuant hereto, and (iii) the assignment, pledge and grant of
security interest contained in such Pledge Agreement Supplement shall, as to
such Pledgor, operate as the assignment, pledge and grant of security interest,
as if such assignment, pledge and grant were contained in Section 1 hereof and
such Pledgor was a signatory hereto.
SECTION 19. ADDRESSES FOR NOTICES19. ADDRESSES FOR NOTICES.
All notices and other communications provided for hereunder shall be in writing
(including telecopier, telegraphic, telex or cable communication) and, mailed,
telegraphed, telecopied, telexed, cabled or delivered to the U.S. Borrower, the
Canadian Borrower or to the Administrative Agent, as the case may be, in the
case of the U.S. Borrower, the Canadian Borrower or the Administrative Agent,
addressed to it at its address specified in the Credit Agreement, in the case of
Accuride Ventures addressed to it at: 2315 Adams Lane, P.O. Box 40, Henderson KY
4240, Attn: William Greubel, with a copy to KKR at 2800 Sand Hill Road, Suite
200, Menlo Park, CA 94205, Attn: Todd Fisher, or to any other Pledgor addressed
to it at its address set forth beneath the name of such other Pledgor on the
signature pages of the Pledge Agreement Supplement pursuant to which it became a
party hereto, or, as to any party, at such other address as shall be designated,
in the case of the Administrative Agent, by the Administrative Agent in a
written notice to the U.S. Borrower, and in the case of the U.S. Borrower or any
other Pledgor, by the U.S. Borrower or such other Pledgor in a written notice to
the Administrative Agent, in each case complying as to delivery with the terms
of this Section. All such notices and other communications shall, when mailed,
telecopied, telegraphed, telexed or cabled, respectively, be effective when
deposited in the mails, telecopied, delivered to the telegraph company,
confirmed by telex answerback or delivered to the cable company, respectively,
addressed as aforesaid.
SECTION 20. CONTINUING SECURITY INTEREST; ASSIGNMENTS UNDER
THE CREDIT AGREEMENT20. CONTINUING SECURITY INTEREST; ASSIGNMENTS UNDER THE
CREDIT AGREEMENT. This Agreement shall create a continuing security interest in
the Collateral and shall (a) remain in full force and effect until the later of
the payment in full in cash of the Secured Obligations, the expiration or
termination of all Letters of Credit and Bank Hedge Agreements and the
Termination Date, (b) be binding upon each Pledgor, its successors and assigns
and (c) inure, together with the rights and remedies of the Administrative Agent
hereunder, to the benefit of the Administrative Agent and each of
16
the other Secured Parties and their respective successors, transferees and
assigns. Without limiting the generality of the foregoing clause (c), any Lender
Party may assign or otherwise transfer all or any portion of its rights and
obligations under the Credit Agreement (including, without limitation, all or
any portion of its Commitment, the Advances owing to it and the Note or Notes
held by it) to any other Person, and such other Person shall thereupon become
vested with all the benefits in respect thereof granted to such Lender herein or
otherwise, subject, in each case, to the provisions of Section 9.07 of the
Credit Agreement.
SECTION 21. RELEASE AND TERMINATION21. RELEASE AND
TERMINATION. (a) Upon the sale, transfer or other disposition of any item of
Collateral in accordance with Section 5.02(d) of the Credit Agreement and the
other terms of the Loan Documents, the Administrative Agent will, at the
applicable Pledgor's expense, execute and deliver to such Pledgor such documents
as such Pledgor shall reasonably request to evidence the release of such item of
Collateral from the pledge and security interest granted hereunder; PROVIDED,
HOWEVER, that:
(i) at the time of and after giving PRO FORMA effect to such
request and release, no Default shall have occurred and be continuing;
(ii) such Pledgor shall have delivered to the Administrative
Agent, at least five Business Days prior to the date of the proposed
release, a written request for release describing the item of
Collateral and the terms of the sale, transfer or other disposition in
reasonable detail, including the price thereof and any expenses in
connection therewith, together with a form of release for execution by
the Administrative Agent and a certification by such Pledgor to the
effect that the subject transaction is in compliance with the Loan
Documents and as to such other matters as the Administrative Agent may
reasonably request; and
(iii) the Net Cash Proceeds of any such sale, transfer or
other disposition shall be applied to prepay the Advances outstanding
at such time in accordance with, and to the extent required under,
Section 2.06(b) of the Credit Agreement.
(b) Upon the later of the payment in full in cash of the Secured
Obligations, the termination or expiration of all Letters of Credit and Bank
Hedge Agreements and the Termination Date, the pledge, assignment and security
interest granted hereby shall terminate and all rights to the Collateral shall
revert to the Pledgors. Upon any such termination, the Administrative Agent
will, at each Pledgor's sole expense, return to such Pledgor such Collateral of
such Pledgor in the Administrative Agent's possession as shall not have been
sold or otherwise applied pursuant to the terms of the Loan Documents, and will
execute and deliver to such Pledgor such documents as such Pledgor shall
reasonably request to evidence such termination and revision.
SECTION 22. SECURITY INTEREST ABSOLUTE22. SECURITY INTEREST
ABSOLUTE. (a) The Obligations of each Pledgor under this Agreement are
independent of any of the other Obligations of any of the other Loan Parties
under or in respect of the Loan Documents, and a separate action or actions may
be brought or prosecuted against each of the Pledgors to enforce this Agreement
and the pledge, assignment and security interest granted by such Pledgor
hereunder, irrespective of whether any action is brought against any of the
other Loan Parties or whether any of the other Loan Parties is
17
joined in any such action or actions. All rights of the Administrative Agent and
the other Secured Parties and the pledges, assignments and security interests
created hereunder, and all obligations of each of the Pledgors hereunder, shall
be absolute, unconditional and irrevocable irrespective of, and each of the
Pledgors hereby irrevocably waives any defenses it may now have or may hereafter
acquire in any way relating to, any or all of the circumstances described in
Section 6.02 of the Credit Agreement or Section 2 of the Subsidiaries Guarantee
or any other circumstance that might constitute a defense available to, or a
discharge of, any of the Pledgors or the other Loan Parties.
(b) This Agreement shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any of the Secured
Obligations is rescinded or must otherwise be returned by the Administrative
Agent or any of the other Secured Parties or by any other Person upon the
insolvency, bankruptcy or reorganization of any of the Pledgors or otherwise,
all as though such payment had not been made, and each of the Pledgors hereby
unconditionally and irrevocably agrees that it will indemnify the Administrative
Agent and each of the other Secured Parties, upon demand, for all of the costs
and expenses (including, without limitation, reasonable fees and expenses of
counsel) incurred by the Administrative Agent or such other Secured Party in
connection with such rescission or restoration, including any such costs and
expenses incurred in defending against any claim alleging that such payment
constituted a preference, a fraudulent transfer or a similar payment under any
bankruptcy, insolvency or similar law.
SECTION 23. SEVERABILITY23. SEVERABILITY. The provisions of
this Agreement are severable, and if any term or provision shall be held
illegal, invalid or unenforceable in whole or in part in any jurisdiction, then
such illegality, invalidity or unenforceability shall affect only such term or
provision, or part thereof, in such jurisdiction, and shall not in any manner
affect such term or provision in any other jurisdiction, or any other term or
provision of this Agreement in any jurisdiction.
SECTION 24. EXECUTION IN COUNTERPARTS24. EXECUTION IN
COUNTERPARTS. This Agreement may be executed in any number of counterparts and
by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement. Delivery of an executed counterpart of a
signature page to this Agreement by telecopier shall be effective as delivery of
a manually executed counterpart of this Agreement.
SECTION 25. GOVERNING LAW; TERMS25. GOVERNING LAW; TERMS. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, except to the extent that the perfection and the effect of
perfection of the security interest hereunder, or remedies hereunder, in respect
of any particular Collateral, pursuant to the laws of the State of New York, are
governed by the laws of a jurisdiction other than the State of New York. Unless
otherwise defined herein or in the Credit Agreement, terms used in Articles 8
and 9 of the N.Y. Uniform Commercial Code are used herein as therein defined.
18
IN WITNESS WHEREOF, each Pledgor has caused this Agreement to
be duly executed and delivered by its officer thereunto duly authorized as of
the date first above written.
ACCURIDE CORPORATION
By
---------------------------
Title:
Address: 2315 Adams Lane
Henderson, KY 42420
ACCURIDE CANADA INC.
By
---------------------------
Title:
Address: 31 Firestone Boulevard
London, Ontario, Canada
NSW 5S1
ACCURIDE VENTURES, INC.
By
---------------------------
Title:
Address: [ ]
19
SCHEDULE I
INITIAL PLEDGED INTERESTS
PERCENTAGE OF
NAME OF PLEDGOR NAME OF ISSUER CLASS OF STOCK STOCK CERTIFICATE NO(S) NUMBER OF SHARES OUTSTANDING SHARES
- --------------- -------------- -------------- ----------------------- ---------------- ------------------
EXHIBIT A TO THE
PLEDGE AGREEMENT
----------------
FORM OF CASH COLLATERAL ACCOUNT LETTER
[NAME OF BORROWER]
[ADDRESS]
[Date of Cash Collateral Account Letter]
Citibank, N.A.
399 Park Avenue
New York, New York 10043
Attention: _______________
[NAME OF APPLICABLE BORROWER]
Gentlemen/women:
Reference is made to (a) deposit account no.___________ (the
"CASH COLLATERAL ACCOUNT") maintained with you by [Name of Borrower] (the
"BORROWER"). Pursuant to the Pledge Agreement dated January 21, 1998 (as
amended, supplemented or otherwise modified hereafter from time to time, the
"PLEDGE AGREEMENT"; terms defined therein and not otherwise defined herein being
used herein as therein defined) made by the Borrower and the other pledgors (the
"PLEDGORS") party thereto in favor of Citicorp USA, Inc., as administrative
agent (together with any successor thereto appointed pursuant to Article VIII of
the Credit Agreement, the "ADMINISTRATIVE AGENT") for the Secured Parties
referred to therein, the Borrower has granted to the Administrative Agent, on
behalf of the Secured Parties, sole and exclusive dominion and control of the
Cash Collateral Account and a lien on and security interest in certain property
and assets of the Borrower, including, among other things, the following
(collectively, the "ACCOUNT COLLATERAL"):
(a) the Cash Collateral Account, all of the funds held therein
and all of the certificates and instruments, if any, from time to time
representing or evidencing the Cash Collateral Account; and
(b) all of the Collateral Investments made on behalf of the
Borrower from time to time and all of the certificates and instruments,
if any, from time to time representing or evidencing any such
Collateral Investments; and
(c) all of the interest, dividends, distributions, cash,
instruments and other property and assets from time to time received,
receivable or otherwise distributed in respect of or in exchange for
any or all of the then existing Account Collateral; and
(d) all of the proceeds of any and all of the foregoing
Account Collateral. It is a condition to the continued maintenance of
the Cash Collateral Account with you that you agree to this letter
agreement.
By signing this letter agreement, you acknowledge notice of,
and consent to the terms and conditions of, the Pledge Agreement and the grant
of the lien and security interest in, and the pledge and assignment of, the
Account Collateral to the Administrative Agent, on behalf of the Secured
Parties, and you confirm to the Administrative Agent that (a) the Cash
Collateral Account is maintained with you at your offices at Citibank, N.A.,
[399 Park Avenue, New York, New York, 10043][__________________________,
Toronto, Ontario, Canada], and is entitled "_____________, cash collateral
account for the benefit of Citicorp USA, Inc., as Administrative Agent" and the
account number therefor is as set forth in the immediately preceding paragraph
and (b) you have not received any notice of any other lien or security interest
in, pledge or assignment of, or other claim (other than that of the Borrower) on
or to the Cash Collateral Account or any of the other Account Collateral.
Further, you hereby agree with the Administrative Agent that:
(i) The Cash Collateral Account will be maintained solely for
the benefit of the Administrative Agent, on behalf of the Secured
Parties, will be and remain entitled as set forth in clause (a) of this
paragraph and will be subject to written instructions only from an
officer of the Administrative Agent.
(ii) Notwithstanding anything to the contrary in any agreement
relating to the Cash Collateral Account, the Cash Collateral Account is
and will be subject to the terms and conditions of the Pledge Agreement
and such applicable laws (including, without limitation, such
applicable regulations of the Board of Governors of the Federal Reserve
System and of any other appropriate banking or other governmental
authority) as are in effect from time to time, and to the extent any
term or condition of this letter agreement is inconsistent with the
terms and conditions of the Pledge Agreement, the terms and conditions
of the Pledge Agreement shall govern; PROVIDED, HOWEVER, that you shall
not be liable for any amendment, supplement or other modification of
any term or condition of the Pledge Agreement until you have received
notice of such amendment, supplement or other modification from the
Administrative Agent, and you hereby agree to promptly amend this
letter agreement to comply with any such amendment, supplement or other
modification. The Administrative Agent shall be entitled to exercise
any and all rights of the Borrower in respect of the Cash Collateral
Account in accordance with the terms of the Pledge Agreement, and you
shall comply in all respects with such exercise.
(iii) You will follow your usual operating procedures for the
handling of any remittance received in the Cash Collateral Account that
contains restrictive endorsements, irregularities (such as a variance
between the written and numerical amounts), undated or postdated items,
missing signatures, incorrect payees, etc. that are received for
deposit in the Cash Collateral Account.
(iv) You are hereby authorized by each of the Borrower and the
Administrative Agent to endorse and process, and you hereby agree to
endorse and process, all eligible checks
2
and other remittance items not covered by subparagraph (iii) above and
to deposit such checks and remittance items into the Cash Collateral
Account.
(v) You will maintain a record of all checks, deposits and
other remittance items received in, and all disbursements made from,
the Cash Collateral Account and, in addition to providing the Borrower
with photostats, vouchers, enclosures, records and other documents of
such checks, deposits and disbursements on a monthly basis, you will
furnish to the Administrative Agent a monthly statement of the Cash
Collateral Account (which statement shall be mailed or telecopied to
the Administrative Agent at the address set forth therefor below its
name on the signature pages to this letter agreement).
(vi) In accordance with written instructions received from the
Administrative Agent, you will, subject to the provisions hereof, from
time to time (A) invest amounts on deposit in the Cash Collateral
Account in such Cash Equivalents as are set forth in such instructions
of the Administrative Agent in the name of the Administrative Agent, on
behalf of the Borrower, and (B) invest interest paid on the Cash
Equivalents referred to in subclause (vi)(A) above, and reinvest other
proceeds of any such Cash Equivalents that may mature or be sold, in
each case in such Cash Equivalents as are set forth in the instructions
of the Administrative Agent in the name of the Administrative Agent, on
behalf of the Borrower (the Cash Equivalents referred to in subclauses
(vi)(A) and (vi)(B) above being collectively "COLLATERAL INVESTMENTS").
All of the Collateral Investments and all of the interest and proceeds
that are not invested or reinvested in Collateral Investments as
provided above in this subparagraph (vi) shall constitute part of the
Account Collateral.
(vii) You shall promptly notify each of the Borrower and the
Administrative Agent if the Cash Collateral Account (A) becomes subject
to any writ, garnishment, judgment, warrant of attachment, execution or
similar process or (B) becomes, or is asserted to have become, subject
to any lien, security interest, adverse claim or other encumbrance of
any person or entity other than the Administrative Agent.
(viii) All transfers from the Cash Collateral Account shall be
made by you irrespective of, and without deduction for, any
counterclaim, defense, recoupment, setoff or similar rights in your
favor and shall be final, and you will not seek to recover from the
Administrative Agent for any reason any such payment once made;
PROVIDED, HOWEVER, that you may charge against the Cash Collateral
Account the face amount of any item deposited into or credited to the
Cash Collateral Account which is subsequently returned unpaid due to
uncollected or insufficient funds. Each such transfer of funds shall
neither comprise only a part of a remittance nor reflect the rounding
off of any funds so transferred.
(ix) All service charges and fees with respect to the Cash
Collateral Account shall be payable by the Borrower, but may be charged
to another deposit account maintained by the Borrower with you (other
than any other Cash Collateral Account maintained with you).
(x) The lien and security interest of the Administrative
Agent, on behalf of itself and the other Secured Parties, in the Cash
Collateral Account and the other Account Collateral
3
of the Borrower shall not be terminated until you receive notice of
such termination from the Administrative Agent.
You hereby represent and warrant that the person executing
this letter agreement on your behalf is duly authorized and fully empowered to
do so.
You shall exercise reasonable care in performing your duties
and responsibilities in respect of the Account Collateral and in fulfilling your
obligations under or in respect of this letter agreement. You shall not be held
liable for any claims, damages, losses or expenses incurred by the Borrower or
the Administrative Agent in connection therewith other than for (a) claims,
damages, losses or expenses resulting from your gross negligence or willful
misconduct or (b) your failure to maintain the Account Collateral or to fulfill
your obligations under or in respect of this letter agreement with reasonable
care; PROVIDED, HOWEVER, that in such case your liability shall extend only to
any direct loss resulting therefrom, as opposed to any consequential or special
loss or damage. Except as expressly agreed to in this letter agreement, you have
no duty other than reasonable care and other customary duties with respect to
the Cash Collateral Account and the other Account Collateral and the monitoring
and safeguarding of all of the items deposited into the Cash Collateral Account.
No amendment or waiver of any provision of this letter
agreement, and no consent to any departure by you or the Borrower herefrom,
shall be effective unless the same shall be in writing as signed by each of you,
the Borrower and the Administrative Agent.
This letter agreement shall be binding upon you and your
successors and assigns and shall inure to the benefit of, and be enforceable by,
the Administrative Agent and the other Secured Parties and their respective
successors, transferees and assigns. You may terminate this letter agreement
upon 30 days' prior written notice to the Borrower and the Administrative Agent.
Upon such termination, you (a) shall close the Cash Collateral Account and
transfer all funds in the Cash Collateral Account in accordance with the
instructions of the Administrative Agent and (b) shall nonetheless remain
obligated promptly to transfer to the Administrative Agent, as instructed by the
Administrative Agent at such time, all funds and other property and assets
received in respect of the Cash Collateral Account.
This letter agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which when
taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of a signature page to this letter agreement shall be
effective as delivery of a manually executed counterpart of this letter
agreement.
This letter agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
4
Please indicate your acknowledgment of and agreement to the
provisions of this letter agreement by signing in the appropriate space provided
below and returning this letter agreement to Citicorp USA, Inc., 399 Park
Avenue, New York, New York 10043, Telecopier No.: (212) 793-_____,
Attention:________________. If you elect to deliver this letter agreement by
telecopier, please arrange for the executed original to follow by next-day
courier.
Very truly yours,
[NAME OF BORROWER], as Borrower
By_______________________________
Name:
Title:
PERSON AND ADDRESS FOR NOTICES:
---------------------
---------------------
---------------------
---------------------
Tel: ________________
Fax: ________________
CITICORP USA, INC., as
Administrative Agent
By______________________________
Name:
Title:
PERSON AND ADDRESS FOR NOTICES:
Attn: _______________________
Citicorp USA, Inc.
399 Park Avenue
New York, New York 10043
Tel: (212) 559-5601
Fax: (212) 793-8879
5
Acknowledged and agreed to as of the date first above written:
CITIBANK, N.A.
By___________________________
Name:
Title:
PERSON AND ADDRESS FOR NOTICES:
Citibank, N.A.
399 Park Avenue
New York, NY 10043
Attn: Charles Foster
Tel: (212) 559-5320
Fax: (212) 758-6278
6
EXHIBIT B TO THE
PLEDGE AGREEMENT
FORM OF PLEDGE AGREEMENT SUPPLEMENT
[Date]
Citicorp USA, Inc., as the Administrative
Agent for the Lender Parties party to
the Credit Agreement referred to below
399 Park Avenue
New York, New York 10043
Attention: _______________
ACCURIDE CORPORATION
Ladies and Gentlemen:
Reference is made to (i) the Amended and Restated Credit
Agreement dated as of April 16, 1999 (such Credit Agreement, as in effect on the
date hereof and as it may hereafter be amended or otherwise modified from time
to time, being the "CREDIT AGREEMENT") among Accuride Corporation, a Delaware
corporation, Accuride Canada Inc., a corporation organized and existing under
the law of the Province of Ontario, the banks, financial institutions and other
institutional lenders parties thereto as Lenders, Citibank, N.A., as Initial
Issuing Bank, Citicorp USA, Inc., as Swing Line Bank and Administrative Agent
(in such capacity or Administrative Agent, the "ADMINISTRATIVE AGENT"), Salomon
Smith Barney Inc., as Arranger, Bankers Trust Company, as Syndication Agent, and
Wells Fargo Bank N.A., as Documentation Agent, and (ii) the Amended and Restated
Pledge Agreement dated April 16, 1999, (such Pledge Agreement, as in effect on
the date hereof and as it may hereafter be amended or otherwise modified from
time to time, being the "PLEDGE AGREEMENT") by the U.S. Borrower and the other
Pledgors party thereto to the Administrative Agent. The terms defined in the
Credit Agreement or the Pledge Agreement and not otherwise defined herein shall
have the same meanings as specified in the Credit Agreement or the Pledge
Agreement.
[SECTION _. THE PLEDGE AGREEMENT. The undersigned hereby
agrees, as of the date first above written, to be bound as a Pledgor by all of
the terms and provisions of the Pledge Agreement to the same extent as each of
the other Pledgors. The undersigned further agrees, as of the date first above
written, that each reference in the Pledge Agreement to an "Additional Pledgor"
or a "Pledgor" shall also mean and be a reference to the undersigned, and each
reference in any of the other Loan Documents to a "Pledgor" or a "Loan Party"
shall also mean and be a reference to the undersigned.]
[SECTION _. ADDITIONAL PLEDGED INTERESTS. (a) Pursuant to the
Pledge Agreement, the undersigned assigns and pledges to the Administrative
Agent for its benefit and the ratable benefit of the Secured Parties, and grants
to the Administrative Agent for its benefit and the ratable benefit of the
Secured Parties, a security interest in the shares of stock and other equity
interests set forth on
Schedule I hereto and issued by the Person[s] named therein (such shares and
other equity interests being collectively referred to herein as the "ADDITIONAL
PLEDGED INTERESTS").
(b) The undersigned makes the assignment and pledge, and
grants the security interest, contained in Section 1 of the Pledge
Agreement, of and in the Additional Pledged Interests, as if the
undersigned was an original party to the Pledge Agreement as a Pledgor
with respect to the Additional Pledged Interests thereunder.]
SECTION _. REPRESENTATION AND WARRANTIES. Without limiting the
generality of the foregoing, the undersigned represents and warrants as a
Pledgor as set forth in Section 7 of the Pledge Agreement, as supplemented by
this Pledge Agreement Supplement.
SECTION _. GOVERNING LAW. This Pledge Agreement Supplement
shall be governed by, and construed in accordance with, the laws of the State of
New York, except to the extent that the perfection or the effect of perfection
of the security interest under the Pledge Agreement, or remedies under the
Pledge Agreement, in respect of any Collateral are governed, pursuant to the
laws of the State of New York, by the laws of a jurisdiction other than the
State of New York.
Very truly yours,
[NAME OF ADDITIONAL PLEDGOR]
By______________________________
Name:
Title:
Address:
CONSENT
dated as of April 16, 1999
Reference is made to the foregoing Amended and Restated Pledge
Agreement dated April 16, 1999 (the "PLEDGE AGREEMENT") by Accuride Corporation,
a Delaware corporation (the "U.S. BORROWER"), Accuride Canada, Inc., and
Accuride Ventures, Inc., a Delaware corporation ("ACCURIDE VENTURES" and,
together with the U.S. Borrower, the "U.S. PLEDGORS") in favor of Citicorp USA,
Inc., as Administrative Agent. The terms defined in the Pledge Agreement are
used in this Consent as defined in the Pledge Agreement.
The undersigned, as the general partner of AKW LP, hereby (i)
consents, for purposes of Article 9 of the AKW LP Agreement, to the U.S.
Pledgors' assignment and pledge under the Pledge Agreement of, and the U.S.
Pledgors' grant under the Pledge Agreement of security interests in, the Pledged
Interests issued by AKW LP and to the assignment, sale or other disposition of
such Pledged Interests pursuant to Section 15 of the Pledge Agreement and the
transferee of such assignment, sale or other disposition becoming a Substituted
Limited Partner under the AKW LP Agreement and (ii) agrees that the provisions
of Sections 9.2 through 9.6 of the AKW LP Agreement shall not apply to the U.S.
Pledgors' assignment or pledge under the Pledge Agreement of, or the U.S.
Pledgors' grant under the Pledge Agreement of security interests in, the Pledged
Interests issued by AKW LP, or the assignment, sale or other disposition of such
Pledged Interests pursuant to Section 15 of the Pledge Agreement, and in that
connection waives all of its rights under such provisions with respect to such
assignment, pledge and grant and such assignment, sale and other disposition.
This Consent shall be governed by, and construed in accordance
with, the laws of the State of New York.
AKW GENERAL PARTNER L.L.C.
By: ACCURIDE CORPORATION
By______________________
Name:
Title:
By: ACCURIDE VENTURES, INC.
By______________________
Name:
Title:
AMENDED AND RESTATED PLEDGE AGREEMENT
Dated April 16, 1999
From
ACCURIDE CORPORATION,
ACCURIDE CANADA INC.,
and
ACCURIDE VENTURES, INC.
AS PLEDGORS
to
CITICORP USA, INC.
AS ADMINISTRATIVE AGENT
T A B L E O F C O N T E N T S
---------------------------------
SECTION PAGE
SECTION 1. Grant of Security...............................................................................2
SECTION 2. Security for Obligations........................................................................4
SECTION 3. Delivery of Security Collateral and Account Collateral..........................................4
SECTION 4. Establishment and Maintenance of the Cash Collateral Accounts...................................5
SECTION 5. Investing of Amounts in the Cash Collateral Accounts............................................6
SECTION 6. Release of Amounts..............................................................................7
SECTION 7. Representations and Warranties..................................................................7
SECTION 8. Further Assurances..............................................................................8
SECTION 9. Place of Perfection; Records....................................................................8
SECTION 10. Voting Rights; Dividends; Etc..................................................................8
SECTION 11. Transfers and Other Liens.....................................................................10
SECTION 12. Administrative Agent Appointed Attorney-in-Fact...............................................10
SECTION 13. Administrative Agent May Perform..............................................................11
SECTION 14. The Administrative Agent's Duties.............................................................11
SECTION 15. Remedies......................................................................................11
SECTION 16. Acknowledgments Relating to Security Collateral and Account Collateral........................13
SECTION 17. Indemnity and Expenses........................................................................14
SECTION 18. Amendments; Waivers; Pledge Agreement Supplement; Etc.........................................14
SECTION 19. Addresses for Notices.........................................................................15
SECTION 20. Continuing Security Interest; Assignments Under the Credit Agreement..........................15
SECTION 21. Release and Termination.......................................................................15
SECTION 22. Security Interest Absolute....................................................................16
SECTION 23. Severability..................................................................................16
SECTION 24. Execution in Counterparts.....................................................................17
SECTION 25. Governing Law; Terms..........................................................................17
SECTION PAGE
Schedule I-Initial Pledged Interests
Exhibit A-Form of Cash Collateral Account Letter
Exhibit B-Form of Pledge Agreement Supplement