EXECUTION VERSION
KRONOS INTERNATIONAL, INC.
as Pledgor
U.S. BANK, National Association
as Pledgee
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SHARE PLEDGE AGREEMENT
(Geschaftsanteilsverpfandung)
relating to KRONOS TITAN GmbH
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Contents
Clause Page
1. DEFINITIONS AND LANGUAGE.........................................3
2. PLEDGED SHARES...................................................4
3. PLEDGE...........................................................4
4. SCOPE OF THE PLEDGES.............................................5
5. SHARE SPLITS.....................................................6
6. PURPOSE OF THE PLEDGES...........................................6
7. EXERCISE OF MEMBERSHIP RIGHTS....................................6
8. ENFORCEMENT OF THE PLEDGES.......................................6
9. REPRESENTATIONS AND WARRANTIES...................................8
10. UNDERTAKINGS OF THE PLEDGOR......................................9
11. INDEMNITY........................................................11
12. DURATION AND INDEPENDENCE........................................11
13. RELEASE (PFANDFREIGABE)..........................................12
14. COSTS AND EXPENSES...............................................12
15. PARTIAL INVALIDITY; WAIVER.......................................12
16. AMENDMENTS.......................................................13
17. NOTICES AND THEIR LANGUAGE.......................................13
18. APPLICABLE LAW, JURISDICTION.....................................14
R e c o r d e d
in Berlin on 11 April 2006
Before me, the undersigning Notary in the district of the Higher Regional Court
(Oberlandesgericht) of Berlin
Frank Hoffmann
with my official place of business in Berlin
appeared today:
1. Ms Corinna Marquardt, whose business address is Habelschwerdter Allee 20,
14195 Berlin and who is personally known to the notary.
2. Ms Rita Lubke, whose business address is Habelschwerdter Allee 20, 14195
Berlin and who is personally known to the notary.
The person appearing to 1. declared to make the following declarations not in
her own name but, excluding any personal liability, for and on behalf of
1. KRONOS International, Inc., a corporation organised under the laws of
Delaware, USA, having its seat in Wilmington, Delaware, USA, which
established a registered branch in Leverkusen, Federal Republic of
Germany,
presenting an original power of attorney dated 6 April 2006; and
2. KRONOS Titan GmbH, a limited liability company (Gesellschaft mit
beschrankter Haftung) organised under the laws of the Federal Republic
of Germany having its business address at Peschstra(beta)e 5, 51373
Leverkusen, Germany,
presenting a fax copy of the power of attorney dated 10 April 2006,
promising to furnish the original as soon as possible.
The person appearing to 2. declared to make the following declarations not in
her own name but, excluding any personal liability, for and on behalf of
U.S. Bank, National Association, having its registered address at 555
Southwest Oak Street, Plaza Level 6, Portland Oregon, United States of
America
presenting a fax copy of the power of attorney dated 10 April 2006,
promising to furnish the original as soon as possible.
Neither the Notary nor the proxies assume any liability as to the validity
and/or the scope of the powers of attorney presented.
The aforementioned original powers of attorney will be attached to this deed in
copies which are herewith certified.
The Notary convinced himself that the persons appearing are in adequate command
of the English language and declared that he is in command of the English
language as well.
The persons appearing stated that the parties represented by them requested that
this instrument be recorded in the English language.
On being asked whether there had been any prior involvement by the Notary in
terms of Section 3 para 1 no. 7 of the German Notarisation Act
(Beurkundungsgesetz) the provisions of which had been explained by the Notary,
the persons appearing said that there had been no such prior involvement.
Requesting its notarisation, the persons appearing then declared the following:
This SHARE PLEDGE AGREEMENT (the "Agreement") is made on 11 April 2006
BETWEEN:
(1) KRONOS International, Inc., a corporation organised under the laws of
Delaware, USA, having its seat in Wilmington, Delaware, USA, which
established a registered branch in Leverkusen, Federal Republic of Germany,
registered in the commercial register (Handelsregister) of the local court
(Amtsgericht) of Leverkusen under HRB 3001 (the "Pledgor"); and
(2) U.S. Bank, National Association, having its business address at 555
Southwest Oak Street, Plaza Level 6, Portland Oregon, United States of
America, in its capacity as collateral agent under the Indenture (as
defined below) (the "Pledgee")
WHEREAS:
(A) The Pledgor offered EUR 400,000,000 6.5% senior secured notes (the "Initial
Notes") which are governed by the Indenture to Deutsche Bank AG London
Branch, pursuant to the terms of a purchase agreement dated 5 April 2006.
(B) The Pledgor has agreed to grant a pledge over 65% of the shares of the
Company (as defined below) as security for the Collateral Agent's claims
against the Pledgor under the Parallel Obligations (as defined below). The
Collateral Agent is entitled to this security pursuant to the terms of the
Indenture.
NOW, IT IS AGREED as follows:
1. DEFINITIONS AND LANGUAGE 1.1 In this Agreement:
"Company" means KRONOS TITAN GmbH, a limited liability company
(Gesellschaft mit beschrankter Haftung) organised under the laws of the
Federal Republic of Germany having its business address at Peschstra(beta)e
5, 51373 Leverkusen, Germany, which is registered in the commercial
register (Handelsregister) of the local court (Amtsgericht) of Koln under
HRB 52058.
"Existing Share" has the meaning given to such term in sub-Clause 2.1
hereof.
"Future Shares" means all additional shares in the capital of the Company
(irrespective of their nominal value) which the Pledgor may acquire in the
future in the event of a share transfer, an increase of the capital of the
Company or otherwise.
"Holders" means any entity which holds any Notes issued by the Pledgor from
time to time.
"Indenture" means an indenture dated 11 April 2006 between the Pledgor and
the The Bank of New York, a New York banking corporation, having its
principal place of business at 101 Barclay Street, New York, NY 10286,
United States of America.
"Notes" means the EUR 400,000,000 6.5% senior secured notes issued by the
Pledgor under the Indenture.
"Parallel Obligations" means the independent obligations of the Pledgor to
pay to the Pledgee sums equal to the sums owed by it to the Holders under
the Indenture or the Notes.
"Pledge" and "Pledges" have the meanings given to such terms in sub-Clause
3.1.
"Secured Obligations" means any and all obligations (present and future,
actual and contingent) which are (or are expressed to be) or become owing
by the Pledgor to the Pledgee under or in connection with the Notes or the
Indenture (including, but not limited to the Parallel Obligations). The
Secured Obligations shall include any obligation based on unjust enrichment
(ungerechtfertigte Bereicherung) or tort (Delikt).
"Shares" means the Existing Share and the Future Shares.
1.2 This Agreement is made in the English language. For the avoidance of doubt,
the English language version of this Agreement shall prevail over any
translation of this Agreement. However, where a German translation of a
word or phrase appears in the text of this Agreement, the German
translation of such word or phrase shall prevail.
1.3 Any reference in this Agreement to a "Clause" or a "sub-Clause" shall,
subject to any contrary indication, be construed as a reference to a Clause
or a sub-Clause hereof.
2. PLEDGED SHARES
2.1 The Company has a nominal share capital (Stammkapital) of EUR 10,000,000.00
(in words: Euro ten million) which is divided into one share (the "Existing
Share").
2.2 The Pledgor is the owner of the Existing Share.
3. PLEDGE
3.1 The Pledgor hereby grants to the Pledgee first ranking pledges
(Pfandrechte) over portions of the Existing Share that represent 65% of the
nominal value of each Existing Share and further first ranking pledges over
portions of each Future Share that represent 65% of the nominal value of
each Future Share together with all ancillary rights and claims associated
with the pledged Shares as more particularly specified in Clause 4 (each a
"Pledge" and together the "Pledges"). The Pledgor shall take all actions
and make all declarations required or appropriate in connection with the
pledges. It shall in particular consent in writing to any share split which
is necessary in connection with such pledge in accordance with the
requirements set forth in Section 17 German Limited Liabilities Act (GmbHG)
and shall procure that the Company grants any necessary consent in a
situation of the enforcement of the pledged Shares, especially in relation
to the Share Split (as defined below). Residual amounts, if any, shall be
rounded down to the nearest amount which can be divided by EUR 50.00.
3.2 The Pledgee hereby accepts the Pledge.
3.3 The validity and effect of each of the Pledges shall be independent from
the validity and the effect of the other Pledges created hereunder.
3.4 Each of the Pledges is in addition, and without prejudice, to any other
security the Pledgee may now or hereafter hold in respect of the Secured
Obligations.
3.5 For the avoidance of doubt, the parties agree that nothing in this
Agreement shall exclude a transfer of all or part of the Pledges created
hereunder by operation of law upon the transfer or assignment (including by
way of novation or assumption (Vertragsubernahme)) of all or part of the
Secured Obligations by any Pledgee to a successor or assignee.
4. SCOPE OF THE PLEDGES
4.1 The Pledges constituted by this Agreement include:
4.1.1 the present and future rights to receive:
(a) dividends attributable to the pledged Shares, if any; and
(b) liquidation proceeds, redemption proceeds (Einziehungsentgelt), repaid
capital in case of a capital decrease, any compensation in case of
termination (Kundigung) and/or withdrawal (Austritt) of a shareholder
of the Company, the surplus in case of surrender (Preisgabe), any
repayment claim for any additional capital contributions (Nachschusse)
and all other pecuniary claims associated with the pledged Shares;
4.1.2 the right to subscribe for newly issued shares; and
4.1.3 all other rights and benefits attributable to the pledged Shares.
4.2 Notwithstanding that the dividends are pledged hereunder, the Pledgor shall
be entitled to receive and retain all dividend payments in respect of the
pledged Shares until such time as the Pledgees are entitled to enforce the
Pledges constituted hereunder.
5. SHARE SPLITS
5.1 The Parties acknowledge that, due to applicable mandatory German law, the
necessary share splits dividing the Existing Share into two partial shares
(Teilgeschaftsanteile) as indicated in Schedule 3 as well as all share
splits required in connection with the pledge of Future Shares
(collectively, the "Share Splits") will become legally effective only upon
the realisation of the partial shares in accordance with the provisions set
forth herein.
5.2 The Company has consented to the Share Splits set forth in Schedule 3.
Copies of the declarations of consent are attached to this deed as Schedule
4.
6. PURPOSE OF THE PLEDGES
The Pledges hereunder are constituted in order to secure the prompt and
complete satisfaction of any and all Secured Obligations. The Pledges shall
also cover any future extension of the Secured Obligations and the Pledgor
herewith expressly agrees that the provisions of Section 1210 para 1
sentence 2 of the German Civil Code (Burgerliches Gesetzbuch) shall not
apply to this Agreement.
7. EXERCISE OF MEMBERSHIP RIGHTS
The membership rights, including the voting rights, attached to the Shares
remain with the Pledgor. The Pledgor, however, shall at all times until the
full satisfaction of all Secured Obligations or the release of the Pledges
exercise its membership rights, including its voting rights, in good faith
to ensure that the validity and enforceability of the Pledges and the
existence or value of all or part of the Shares are not in any way
adversely affected, other than through dividend payments pursuant to Clause
4.2 above or as otherwise permitted by the Indenture. The Pledgor
undertakes that no resolutions are passed which constitute a breach of its
obligations under Clause 10.
8. ENFORCEMENT OF THE PLEDGES
8.1 If the requirements set forth in Sections 1273 para 2, 1204 et seq. of the
German Civil Code with regard to the enforcement of any of the Pledges are
met (Pfandreife), in particular, if any of the Secured Obligations has
become due and payable and is unpaid, then in order to enforce the Pledges
(or any of them), the Pledgee may at any time thereafter avail itself of
all rights and remedies that a pledgee has against a pledgor under the laws
of the Federal Republic of Germany.
8.2 Notwithstanding Section 1277 of the German Civil Code, the Pledgee is
entitled to exercise its rights without obtaining enforceable judgment or
other instrument (vollstreckbarer Titel). The Pledgee shall be entitled to
have the Pledges enforced in any manner allowed under the laws of the
Federal Republic of Germany, in particular have the Pledges sold (including
at public auction).
8.3 The Pledgor hereby expressly agrees that ten (10) business days' prior
written notice to the Pledgor of the place and time of any such sale shall
be sufficient and the Pledgee shall not be obliged to deliver any further
notices (including, but not limited to the notices set out under Section
1234 of the German Civil Code) to the Pledgor prior to such sale. The sale
may take place at any place in the Federal Republic of Germany designated
by the Collateral Agent, acting for and on behalf of the Pledgee.
8.4 If the Pledgee should seek to enforce the Pledges under sub-Clause 7.1, the
Pledgor shall, at its own expense, render forthwith all necessary
assistance in order to facilitate the prompt sale of the Shares or any part
thereof and/or the exercise by the Pledgee of any other right it may have
as Pledgee.
8.5 Following satisfaction of the requirements for enforcement under sub-Clause
8.1, all subsequent dividend payments and all payments based on similar
ancillary rights attributed to the Shares may be applied by the Pledgee in
satisfaction in whole or in part of the Secured Obligations or treated as
additional collateral.
8.6 Even if the requirements for enforcement referred to under sub-Clause 8.1
above are met, the Pledgee shall not, whether as proxy or otherwise, be
entitled to exercise the voting rights attached to the Shares. However, the
Pledgor shall, upon occurrence of an event which allows the Pledgee to
enforce the Pledges, have the obligations and the Pledgees shall have the
rights set forth in sub-Clause 10.6 below regardless of which resolutions
are intended to be adopted.
8.7 The Pledgee may, in its sole discretion, determine which of several
security interests, if applicable, shall be used to satisfy the Secured
Obligations. The Pledgor hereby expressly waives its right pursuant to
Section 1230 sentence 2 of the German Civil Code to limit the realisation
of the Shares to such number of pledged companies as are necessary to
satisfy the Secured Obligations and agrees further that the Pledgee may
decide to enforce the Pledges individually in separate proceedings or
together with pledges over shares or partnership interests in one or more
other companies at one single proceeding (Gesamtverwertung).
8.8 The Pledgor hereby expressly waives all defences of revocation (Einrede der
Anfechtbarkeit) and set-off (Einrede der Aufrechenbarkeit) pursuant to
Sections 770, 1211 of the German Civil Code.
8.9 The Pledgor hereby expressly waives its defences based on defences any
obligor might have against any of the Secured Obligations (Einreden des
Hauptschuldners) pursuant to Section 1211 para 1 sentence 1 alternative 1
of the German Civil Code.
8.10 If the Pledges are enforced or if the Pledgor has discharged any of the
Secured Obligations (or any part of them), Section 1225 of the German Civil
Code (legal subrogation of claims to a pledgor - Forderungsubergang auf den
Verpfander) shall not apply and no rights of the Pledgee shall pass to the
Pledgor by subrogation or otherwise. Further, the Pledgor shall not at any
time before, on or after an enforcement of the Pledges and as a result of
the Pledgor entering into this Agreement, be entitled to demand
indemnification or compensation from the Company or any of the Company's
affiliates or to assign any of these claims.
8.11 The Pledgor irrevocably and by way of security appoints the Pledgee as its
attorney (with full power of substitution and delegation, and including
exemption from the restrictions of ss. 181 of the German Civil Code) in its
name and on its behalf to do anything which it has authorised the Pledgee
to do under this Agreement and/or is required and legally able to do under
this Agreement but has failed to do. In addition, the Company granted a
power of attorney attached as Schedule 5 to this agreement to the Pledgee,
and thereby irrevocably and by way of security appoints the Pledgee as its
attorney (with full power of substitution and delegation) in its name and
on its behalf to do all necessary things in a situation of enforcement of
the pledged Shares, especially with regard to the Share Split.
9. REPRESENTATIONS AND WARRANTIES
The Pledgor represents and warrants to the Pledgee by way of an independent
guarantee (selbststandiges Garantieversprechen) that:
9.1 at the date hereof the Company and the Pledgor itself are both validly
existing and neither unable to pay their respective debt when due
(zahlungsunfahig), over-indebted (uberschuldet) or deemed unable to pay
their respective debt as it falls due (drohend zahlungsunfahig) (all within
the meaning of Sections 17 to 19 of the German Insolvency Act
(Insolvenzordnung)) nor subject to any insolvency proceedings
(Insolvenzverfahren) or any refusal of opening insolvency proceedings for
lacking assets (Abweisung mangels Masse) (within the meaning of Section 26
of the German Insolvency Act);
9.2 the statements made in Clause 2 above are true and correct;
9.3 the Existing Share is fully paid in and there is no nor will there be any
obligation for a shareholder to make additional contributions (keine
Nachschusspflicht);
9.4 the share capital has not been repaid in any way;
9.5 all facts capable of being entered into the commercial register of the
Company have been entered into the commercial register, and, in particular,
no shareholders' resolutions regarding changes in the articles of
association of the Company have been passed which are not entered into the
commercial register of the Company;
9.6 it is the sole legal and beneficial owner, free from encumbrances (other
than the Pledges created hereunder and, to the extent not yet released, the
pledges created under a partnership interest pledge agreement dated 28 June
2002 relating to the fixed capital contribution of Kronos Titan GmbH & Co.
O.H.G. (meanwhile converted into the Company)), of all Shares and has the
corporate power and authority to enter into this Agreement;
9.7 this Agreement constitutes its legal, valid and binding obligations and the
Pledges constituted hereunder create valid pledges which are enforceable
without enforceable judgment or other instrument (vollstreckbarer Titel);
9.8 all necessary authorisations to enable or entitle the Pledgor to enter into
this Agreement have been obtained and are in full force and effect and will
remain in full force and effect at all times during the subsistence of the
security hereby construed and pursuant to the articles of association of
the Company, the Pledges over the Shares and over any and all ancillary
rights and claims associated with the Shares (as more particularly
specified in Clause 4) are subject to the approval of the Company's
shareholders or the Company, a copy of such approval is attached hereto as
Schedule 1;
9.9 there are no silent partnership agreements or similar arrangements by which
a third party is entitled to a participation in the profits or revenue of
the Company; and
9.10 the place from which the Company is in fact administered and where all
material managerial decisions are taken (tatsachlicher Verwaltungssitz) is
situated in the Federal Republic of Germany.
10. UNDERTAKINGS OF THE PLEDGOR
Except as otherwise permitted by the terms of this Agreement, during the
term of this Agreement, the Pledgor undertakes to the Pledgee:
10.1 unless permitted by the Indenture, not to take, or participate in, any
action which results or might result in the Pledgor's loss of ownership of
all or part of the Shares, or any other transaction which would have the
same result as a sale, transfer or other disposal of the Shares or which
would for any other reason be inconsistent with the security interest of
the Pledgee or the security purpose (as described in Clause 5) or defeat,
impair or circumvent the rights of the Pledgee except with Pledgee's prior
written consent;
10.2 not to take, or participate in, any merger, consolidation, conversion of
form, or other business combination or restructuring of similar effect
("Conversion") as a result of which the Company would be converted into,
assumed by, or continue to exist as, a corporation (limited liability
company (Gesellschaft mit beschrankter Haftung) or stock corporation
(Aktiengesellschaft)), unless it is ensured that as from the time when the
Conversion will become legally effective, the Collateral Agent will be
granted, at equal terms as under this Agreement, a pledge over 65% of the
entire capital stock (Stammkapital or Grundkapital) of such corporation;
10.3 not to encumber, permit to subsist, create or agree to create any other
security interest or third party right in or over the Shares or other
rights subject to the Pledges except as set out in this Agreement;
10.4 to promptly effect any contributions in cash (Bareinlage) or kind
(Sacheinlage) to be made in respect of the Shares;
10.5 to promptly notify the Pledgee in writing of any change in the shareholding
in or capital of the Company or any encumbrance over the Shares (or part of
them). In the case of any attachment (Pfandung) in respect of any of the
Shares, the Pledgor shall promptly notify the Pledgee, by notification in
writing to the Collateral Agent, such notice to be accompanied by any
documents the Pledgee might need to defend itself against any claim of a
third party. In particular, the Pledgor shall promptly forward to the
Collateral Agent a copy of the attachment order (Pfandungsbeschluss), any
transfer order (Uberweisungsbeschluss) and all other documents necessary
for a defence against the attachment;
10.6 to promptly inform the Pledgee in writing of all matters concerning the
Company (other than those occurring in the ordinary course of business) of
which the Pledgor is aware and which it reasonably believes might adversely
affect the security interest of the Pledgee. In particular, the Pledgor
shall notify the Pledgee, by notification in writing to the Collateral
Agent, forthwith of any shareholders' meeting (other than those occurring
in the ordinary course of business) at which a shareholders' resolution is
intended to be adopted which could have an adverse effect upon any of the
Pledges. The Pledgor shall allow, following the occurrence of any of the
circumstances which permit the Pledgee to enforce the Pledges constituted
hereunder in accordance with Clause 7, the Pledgee or, as the case may be,
its proxy or any other person designated by the Pledgee, to participate in
all such shareholders' meetings of the Company as attendants without power
to vote. Subject to the provision contained in sub-Clause 12.1, the
Pledgee's right to attend the shareholders' meeting shall lapse immediately
upon complete satisfaction and discharge of the Secured Obligations;
10.7 in the event of any increase in the capital of the Company, not to allow,
without the prior written consent of the Pledgee any party other than
himself to subscribe for any Future Shares, and not to defeat, impair or
circumvent in any way the rights of the Pledgee created hereunder;
10.8 to refrain from any acts or omissions, the purpose or effect of which is or
would be the dilution of the value of the Shares or the Shares ceasing to
exist;
10.9 within one month after the date hereof, to notarise an amendment to the
articles of association of the Company to the effect that any transfer of
Shares shall no longer require the consent of the shareholders or any other
party and to apply for the registration of such amendment with the
competent commercial register;
10.10 without undue delay to inform the Pledgee in writing once the amendment to
the articles of association of the Company described in Clause 10.9 above
has become effective;
10.11 after the articles of association of the Company have been amended as set
out in Clause 10.10 above, not to change the articles of association of the
Company to the effect that any transfer of Shares shall only be possible
with the consent of the shareholders;
10.12 not to amend, or vote for any amendment of, the articles of association of
the Company to the extent that such amendment would or would be likely to
adversely affect the security interest of the Pledges created hereunder
without the prior written consent of the Pledgee; and
10.13 insofar as additional declarations or actions are necessary for the
creation of the Pledges (or any of them) in favour of the Pledgees, the
Pledgor shall at the Collateral Agent's request make such declarations and
undertake such actions at the Pledgor's costs and expenses.
11. INDEMNITY
11.1 The Pledgee shall not be liable for any loss or damage suffered by the
Pledgor save in respect of such loss or damage which is suffered as a
result of the wilful misconduct or gross negligence of the Pledgee.
11.2 The Pledgor will indemnify the Pledgee and keep the Pledgee indemnified
against any and all damages, losses, actions, claims, expenses, demands and
liabilities which may be incurred by or made against the Pledgee for
anything done or omitted in the exercise or purported exercise of the
powers contained herein or occasioned by any breach of the Pledgor of any
of its obligations or undertakings herein contained other than to the
extent that such damages, losses, actions, claims, expenses, demands and
liabilities are incurred by or made against the Pledgee as a result of its
gross negligence or wilful misconduct.
12. DURATION AND INDEPENDENCE
12.1 This Agreement shall remain in full force and effect until complete
satisfaction of the Secured Obligations. The Pledges shall not cease to
exist, if the Pledgor has only temporarily discharged the Secured
Obligations.
12.2 This Agreement shall create a continuing security and no change, amendment,
or supplement whatsoever in the Indenture or in any document or agreement
related to Indenture shall affect the validity or the scope of this
Agreement nor the obligations which are imposed on the Pledgor pursuant to
it.
12.3 This Agreement is independent from any other security or guarantee which
may have been or will be given to the Pledgee. None of such other security
shall prejudice, or shall be prejudiced by, or shall be merged in any way
with this Agreement.
12.4 Waiving Section 418 of the German Civil Code, the Pledgor hereby agrees
that the security created hereunder shall not be affected by any transfer
or assumption of the Secured Obligations to, or by, any third party.
13. RELEASE (PFANDFREIGABE)
Upon complete and irrevocable satisfaction of the Secured Obligations, the
Pledgee will as soon as reasonably practical declare the release of the
Pledges (Pfandfreigabe) to the Pledgor as a matter of record or, if
applicable, surrender any excess enforcement proceeds. For the avoidance of
doubt, the parties are aware that upon full and complete satisfaction of
the Secured Obligations the Pledges, due to their accessory nature
(Akzessorietat) cease to exist by operation of German mandatory law. 14.
COSTS AND EXPENSES
All costs, charges, fees and expenses triggered by this Agreement or
reasonably incurred in connection with its preparation, execution,
amendments and enforcement (in each case including fees for legal advisers)
shall be borne by the Pledgor.
15. PARTIAL INVALIDITY; WAIVER
15.1 If at any time, any one or more of the provisions hereof is or becomes
invalid, illegal or unenforceable in any respect under the law of any
jurisdiction, such provision shall as to such jurisdiction, be ineffective
to the extent necessary without affecting or impairing the validity,
legality and enforceability of the remaining provisions hereof or of such
provisions in any other jurisdiction. The invalid, illegal or unenforceable
provision shall be deemed to be replaced with such valid, legal or
enforceable provision which comes as close as possible to the original
intent of the parties and the invalid, illegal or unenforceable provision.
Should a gap (Regelungslucke) become evident in this Agreement, such gap
shall, without affecting or impairing the validity, legality and
enforceability of the remaining provisions hereof, be deemed to be filled
in with such provision which comes as close as possible to the original
intent of the parties.
15.2 No failure to exercise, nor any delay in exercising, on the part of the
Pledgee, any right or remedy hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any right or remedy prevent any
further or other exercise thereof or the exercise of any other right or
remedy. The rights and remedies provided hereunder are cumulative and not
exclusive of any rights or remedies provided by law.
15.3 In particular, the Pledges shall not be affected and shall in any event
extend to any and all Shares in the Company even if the number or nominal
value of the Existing Share or the aggregate share capital of the Company
as stated in Clause 2 are inaccurate or deviate from the actual facts.
16. AMENDMENTS
Changes and amendments to this Agreement including this Clause 16 shall be
made in writing, unless notarial form by operation of law is required.
17. NOTICES AND THEIR LANGUAGE
17.1 All notices and communications under or in connection with this Agreement
shall be in writing and shall be delivered by letter, posted or delivered
by hand, or fax. Each notice or communication shall be given to the
relevant party at the address or fax number and marked for the attention of
the person(s) or department from time to time specified in writing by that
party to the other. The initial address, fax number and person(s) or
department so specified by each party are set out below:
For the Pledgor: KRONOS International, Inc.
Address: Peschstra(beta)e 5
D-51373 Leverkusen/Germany
Fax: +49 214 421 62
Attention: Volker Roth (Director and Vice
President, Controller)
For the Pledgee: U.S. Bank,National Association
Address: 555 Southwest Oak Street
Plaza Level 6
Portland Oregon
United States of America
Fax: +1 503 275 5738
Attention: Cheryl K. Nelson
17.2 Proof of posting or dispatch of any notice or communication to the Pledgor
shall be deemed (widerlegbare Vermutung) to be proof of receipt (i) in case
of a letter, on the second business day in the country of receipt after
posting, and (ii) in case of a fax transmission on the business day in the
country of receipt immediately following the date of its dispatch.
17.3 Save for the notice pursuant to Section 16 of the German Limited Liability
Companies Act (Gesetz betreffend die Gesellschaften mit beschrankter
Haftung) and Section 1280 of the German Civil Code (which shall be
substantially in the form of Schedule 2 attached hereto) any notice or
other communication under or in connection with this Agreement shall be in
the English language or, if in any other language, accompanied by a
translation into English. In the event of any conflict between the English
text and the text in any other language, the English text shall prevail.
18. APPLICABLE LAW, JURISDICTION
18.1 This Agreement is governed by the laws of the Federal Republic of Germany.
18.2 The place of jurisdiction for any and all disputes arising under or in
connection with this agreement shall be the district court (Landgericht) in
Frankfurt am Main. The Pledgees however, shall also be entitled to take
action against the Pledgor in any other court of competent jurisdiction.
Further, the taking of proceedings against the Pledgor in any one or more
jurisdictions shall not preclude the taking of proceedings in any other
jurisdiction (whether concurrently or not) if and to the extent permitted
by applicable law.
The Notary advised the persons appearing:
o that a pledge is a security instrument of strictly accessory nature (which
means that it comes into legal existence only if, to the extent that, and
as long as, the underlying secured claims do in fact exist, and that the
owners of the secured claims and the pledgees must be identical);
o that there is no bona fide creation, acquisition nor ranking of a pledge of
shares (which means that the pledgees are not protected if the shares
purported to be pledged do not exist, have been previously transferred to a
third party, or have been previously encumbered for the benefit of a third
party); and
o that the English original version of this Agreement will not be acceptable
for enforcement but will have to be translated, by a certified translator,
into German for such purposes.
The Notary is hereby instructed to give notice of this Agreement and the Pledges
of the rights pursuant to Clause 3 (Pledge) and Clause 4 (Scope of the Pledges)
to the Company by means of providing the attorney of the Company with a notice
substantially in the form of Schedule 2 hereto which shall be accompanied by a
certified copy of this Agreement immediately after the notarization of this
agreement.
The above Agreement including the Schedules was read aloud by the Notary to the
persons appearing, approved by them and signed by the persons appearing and by
the Notary in their own hand as follows: