Document:

Exhibit 4.9

 

CONFORMED
COPY

 

PLEDGE
AGREEMENT

 

 

Dated July 18, 2005

 

 

between

 

Concordia Bus Nordic Holding AB

 

as Pledgor

 

and

 

Concordia Bus AB

 

as Pledgee

 

 

SECOND RANKING
PLEDGE OF SUBORDINATED SHAREHOLDER LOAN

 

 

THIS SECOND RANKING PLEDGE AGREEMENT is dated July 18, 2005 and made
between:

 

(1)                                                    CONCORDIA BUS NORDIC HOLDING
AB (a company
incorporated under the laws of Sweden) of c/o Swebus AB, Solna Strandväg 78,
171 54 Solna, Sweden (corporate identity no 556028-1122), (the “Pledgor”); and

 

(2)                                                    CONCORDIA BUS AB (PUBL) (a company incorporated under the
laws of Sweden) of c/o Swebus AB, Solna Strandväg 78, 171 54 Solna, Sweden
(corporate identity no 556576-4569), (the “Pledgee”).

 

WHEREAS:

 

a)                            pursuant
to a subordinated intragroup loan made on 27 February 2002, the Pledgee has
given Concordia Bus Nordic AB (publ) (“Nordic”) a
subordinated loan of SEK 501,299,922 (the “Loan”) of
which SEK 166,927,467 is outstanding on the date hereof;

 

b)                           pursuant
to a sale and assignment agreement dated on or about the date hereof all the
Pledgee’s rights under the Loan have been assigned to the Pledgor (the “Assignment Agreement”);

 

c)                            pursuant
to an agreement dated on or about the date hereof between the Pledgor, the
Pledgee and Nordic the terms of the Loan has been amended and restated (the “Subordinated Loan Agreement”);

 

d)                           the
Security Assets (as defined below) have been pledged, pursuant to a first
ranking pledge agreement dated on or about the date hereof (the “First Pledge Agreement”) to Citicorp Trustee Company Limited
in its capacity as security agent (the “Security Agent”)
under a mezzanine facility agreement made between the Pledgor and the Pledgee as
borrowers, Deutsche Bank Luxembourg S.A. as facility agent and the Security Agent
(the “Mezzanine Agreement”); and

 

e)                            it
is a condition precedent of the Assignment Agreement that the Pledgor enters
into this Pledge Agreement and hereby secures the Secured Obligations (as
defined below).

 

IT IS HEREBY AGREED as follows:

 

1.                                               DEFINITIONS AND INTERPRETATION

 

1.1                                          In
this Agreement:

 

“Finance Documents”
means this Agreement and the Assignment Agreement;

 

2

 

“Secured Obligations”
means all present and future obligations and liabilities (whether actual or
contingent and whether owed jointly or severally or in any other capacity
whatsoever) of the Pledgor to the Pledgee under or pursuant to the Finance
Documents, in each case together with all costs, charges
and expenses incurred by the Pledgee in connection with the protection,
preservation or enforcement of its respective rights against the Pledgor under
the Finance Documents; and

 

“Security Assets”
means all the Pledgor’s rights under the Loan and the Subordinated Loan
Agreement.

 

1.2                                          In
this Agreement, unless the contrary intention appears, a reference to:

 

a)                  a
provision of law is a reference to that provision as amended or re-enacted,

 

b)                 a
person includes its successors and assigns, and

 

c)                  any
document is a reference to that document as amended, novated or supplemented.

 

1.3                                          Terms
defined in the Assignment Agreement shall have the same meanings when used in
this Agreement unless otherwise defined in this Agreement.

 

1.4                                          If the Pledgee considers that in respect of an amount paid to the
Pledgee under a Finance Document there is a reasonable risk that such payment
will be avoided or otherwise set aside on the liquidation or bankruptcy of the payer
or otherwise, then that amount shall not be considered to have been irrevocably
paid for the purposes of this Agreement.

 

2.                                               PLEDGE

 

2.1                                          The
Pledgor hereby irrevocably and unconditionally, on the terms and conditions set
out herein, pledges to the Pledgee all of the Pledgor’s rights, title and
interest in and to the Security Assets for the purpose of constituting a second
ranking pledge, subject to the rights of the Security Agent under the First
Pledge Agreement, to secure the due and punctual performance of the Secured
Obligations.

 

2.2                                          Notwithstanding
anything to the contrary herein or under applicable law as to the priority of
the security granted by this Agreement, the security created hereunder is
subject to, and subordinated to, and will at all times rank junior to the
security under the First Pledge Agreement.

 

3

 

3.                                               PERFECTION OF PLEDGE

 

3.1                                          The
Pledgor shall immediately at the execution of this Agreement

 

a)                            notify
the Security Agent of the pledge created hereunder by sending a notice in
substantially the form set out in Schedule 1, and

 

b)                           notify
Nordic of the pledge created hereunder by sending a notice in substantially the
form set out in Schedule 2.

 

4.                                               REPRESENTATIONS AND WARRANTIES

 

4.1                                          The
Pledgor represents and warrants to the Pledgee that:

 

a)                  it
is a limited liability company duly incorporated and validly existing under the
laws of Sweden;

 

b)                 the
Pledgor has the power to enter into, deliver and perform, and has taken all
necessary action to authorize the entry into, delivery and performance of this
Agreement and the transactions contemplated by this Agreement;

 

c)                  this
Agreement constitutes legally valid and binding obligations of the Pledgor
enforceable in accordance with its terms (except as such enforcement may be
limited by any relevant bankruptcy, insolvency, receivership or similar laws
affecting creditors’ rights generally);

 

d)                 this
Agreement does not and will not breach or constitute a default under the
constitutional documents of the Pledgor or any law or regulation by which the
Pledgor is bound;

 

e)                  this
Agreement constitutes a second ranking pledge, subject to the rights of the
Security Agent and the secured parties under the First Pledge Agreement, enforceable
against the Pledgor, a liquidator or receiver of the Pledgor and third party
creditors of the Pledgor;

 

f)                    the
Pledgor is the sole, absolute and beneficial owner of the Security Assets; and

 

g)                 other
than as created pursuant to this Agreement and the First Pledge Agreement and
as otherwise permitted under the Mezzanine Agreement, the Security Assets are
free from any encumbrances.

 

4

 

5.                                               COVENANTS BY THE PLEDGOR

 

5.1                                          The Pledgor hereby covenants
with each of the Secured Parties that during the continuance of this Agreement
the Pledgor will:

 

a)                  not
sell, transfer or otherwise dispose of the Security Assets or any part thereof
or interest therein or permit the same to occur;

 

b)                 not
grant any option in or over the Security Assets;

 

c)                  not
create or permit to subsist any security interests on, over, with respect to or
otherwise affecting the whole or any part of the Security Assets (other than the
First Pledge Agreement and Permitted Security Interest as defined in the
Mezzanine Agreement and except for the rights of the Pledgee under this
Agreement, any secured party under a Permitted Security Interest (as defined in
the Mezzanine Agreement) and any secured party under the First Pledge Agreement);

 

d)                 not
hold any security from any other person in respect of the Pledgor’s liability
under this Agreement; and

 

e)                  the
Pledgor shall at any time, if and when required by the Pledgee and at the
Pledgor’s cost, promptly and duly do all such further acts and execute and
deliver any and all such further documents as may in the reasonable opinion of
the Pledgee be necessary in order to give full effect to this Agreement and to
secure to the Pledgee the full benefit of the rights, powers and remedies
conferred upon it in this Agreement, and the Pledgor shall use its best endeavours
to obtain any third party consent where such consent is required in order to
give full effect to such act or document.

 

5.2                                          Clause 5.1 is
subject to Clause 19.18 of the Mezzanine Agreement, the contents of which shall
apply mutatis mutandis to the restrictions set out in Clause 5.1.

 

6.                                               CONTINUING SECURITY

 

6.1                                          The
security constituted by this Agreement shall be a continuing security and shall
not be considered as satisfied or discharged by any intermediate payment or
settlement of the whole or any part of the Secured Obligations and shall be
binding until all the Secured Obligations have been irrevocably paid or discharged
in full.

 

6.2                                          Until
all the Secured Obligations have been irrevocably paid or discharged in full the
Pledgee may refrain from applying or enforcing any other security, monies or
rights held or received by the Pledgee or apply and enforce the same in such

 

5

 

manner and order
as the Pledgee sees fit and the Pledgor shall not be entitled to the benefit of
the same and waives any right it may have of first
requiring the Pledgee to proceed against or enforce any other right or security
or claim payment from any other person before enforcing this Agreement.

 

6.3                                          This
Agreement is in addition to any present and future guarantee, collateral, lien
or other security held by the Pledgee. The Pledgee’s rights hereunder are in
addition to and not exclusive of those provided by law and may be exercised
from time to time and as often as the Pledgee deems expedient.

 

7.                                               EXERCISE OF PLEDGE AND APPLICATION OF MONIES

 

7.1                                          Upon
the Pledgee serving notice on the Pledgor following the occurrence of an event
of default under the Finance Documents, demanding the immediate repayment of
any outstanding amount of the Secured Obligations and at all times thereafter,
so long as the same shall be continuing, and subject to the rights of the
Security Agent under the First Pledge Agreement, the Pledgee may, in addition
to any other remedies provided in the Finance Documents or by applicable law enforce
its rights hereunder in such manner, acting with due care as the Pledgee in its
sole discretion deems fit, and the Pledgee shall not be liable for any loss
arising from or in connection with such enforcement, provided that it has acted
with due care.

 

7.2                                          All
costs and expenses (including legal fees) incurred by the Pledgee in connection
with the enforcement of the security created by this Agreement shall be borne
by the Pledgor and the Pledgor shall indemnify and hold the Pledgee harmless in
respect of such costs and expenses.

 

7.3                                          Chapter
10 Section 2 of the Swedish Commercial Code (Sw:
Handelsbalken 10:2) shall not apply to this Agreement.

 

7.4                                          All
monies received by the Pledgee under or by virtue of the pledge created by this
Agreement or by law or in exercise of the rights, powers and remedies under
this Agreement or by law shall be applied by the Pledgee in the manner and
order set out in the Assignment Agreement.

 

7.5                                          For the purpose of enforcing the security created by this Agreement upon
the occurrence of an event of default under the Finance Documents, the Pledgor
irrevocably authorizes and empowers the Pledgee to act in the name of the
Pledgor, and on behalf of the Pledgor to do all acts and take any necessary or
appropriate steps in respect of the sale of the Security Assets. The power of
attorney set out in this Clause 7.5 shall be valid for as long as this
Agreement remains in force.

 

6

 

8.                                               DISCHARGE OF THE SECURITY ASSETS

 

8.1                                          The
Pledgee may, and upon the irrevocable payment or discharge in full of the
Secured Obligations, shall or shall procure that its nominees or agents shall (as
the case may be) at the request and cost of the Pledgor discharge to the
Pledgor all the right, title and interest in or to the Security Assets of the Pledgee
free from the security in this Agreement.

 

8.2                                          Any
release, discharge or settlement between the Pledgor and Pledgee in relation to
this Agreement shall be conditional upon no disposition or payment to the Pledgee
by the Pledgor or any other person being avoided, set aside or ordered to be
refunded pursuant to any law relating to insolvency or for any other reason.

 

8.3                                          If
any such disposition or payment is avoided, set aside or ordered to be refunded
the Pledgor shall retransfer the Security Assets to the Pledgee and the Pledgee
shall be entitled to enforce this Agreement against the Pledgor as if such
release, discharge or settlement had not occurred and any such disposition or
payment not been made.

 

9.                                               WAIVERS

 

9.1                                          The
liability of the Pledgor under this Agreement shall not be prejudiced, affected
or diminished by any act, omission, circumstance or matter which but for this
provision might operate or release or otherwise exonerate the Pledgor from its
obligations under this Agreement in whole or in part, including without
limitation and whether or not known to the Pledgor or the Pledgee;

 

a)                  any
time or waiver granted to or composition with any other person;

 

b)                 the
taking, variation, compromise, renewal or release of or refusal or neglect to
perfect or enforce any rights, remedies or securities against any other person;

 

c)                  any
legal limitation, disability, incapacity or other circumstances or the
bankruptcy, liquidation or change in the name or constitution of any other person;

 

d)                 any
variation or extension, any increase, exchange, renewal, surrender, release or
loss of or failure to perfect any security or of any non-observance of any
formality in respect of any instruments; and

 

e)                  any
unenforceability or invalidity of the Secured Obligations or of any obligations
of any other person or security, to the intent that the Pledgor’s obligations
under this Agreement shall remain in full force and this

 

7

 

Agreement be
construed accordingly as if there were no such unenforceability or invalidity.

 

9.2                                          Any
waiver by the Pledgee of any terms of this Agreement or any consent or approval
given by any of them under it shall be effective only if given in writing and
then only for the purpose and upon the terms and conditions (if any) on which
it is given. No delay or omission on the part of the Pledgee in exercising any
right or remedy under this Agreement shall impair that right or remedy or
operate as or be taken to be a waiver of it nor shall any single, partial or
defective exercise of any such right or remedy preclude any other or further
exercise under this Agreement of that or any other right or remedy.

 

10.                                        INDEMNITY

 

a)                  The
Pledgor shall, in accordance with the terms of Clause 14.3 of the Mezzanine
Agreement, indemnify the Security Agent for any costs, expenses and liability
as described therein and for the purpose hereof any reference to “the Borrower”
in Clause 14.3 shall be deemed to be a reference to the Pledgor and any
reference to the Finance Documents should be deemed to be a reference to this
Agreement.

 

11.                                        MISCELLANEOUS

 

11.1                                    The
Pledgor may not assign any of its rights under this Agreement. The Pledgee may
assign all or any part of their rights under this Agreement in accordance with,
and in connection with a transfer under, the Assignment Agreement.

 

11.2                                    This
Agreement shall remain in full force and effect notwithstanding any amendments
or variations from time to time to any of the Finance Documents and all
references to a Finance Document herein shall be taken as referring to that
Finance Document as amended or varied from time to time (including, without
limitation, any increase in the amount of the Secured Obligations).

 

11.3                                    If
any provision of this Agreement is or becomes illegal, invalid or unenforceable
that shall not affect the validity or enforceability of any other provision of
this Agreement.

 

11.4                                    This
Agreement may be executed in any number of counterparts and this shall have the
same effect as if the signatures on the counterparts were on a single copy of
this Agreement.

 

11.5                                    All
sums payable by the Pledgor under this Agreement shall be paid without any set-off,
counterclaim, withholding or deduction whatsoever unless required by law

 

8

 

in which event
the Pledgor will, simultaneously with making the relevant payment under this
Agreement, pay to the Pledgee such additional amount as will result in the
receipt by the Pledgee of the full amount which would otherwise have been
receivable and will supply the Pledgee promptly with evidence satisfactory to
the Pledgee that the Pledgor has accounted to the relevant authority for the
sum withheld or deducted.

 

11.6                                    Any
statement, certificate or determination of the Pledgee as to the amount of the
Secured Obligations or (without limitation) any other matter provided for in
this Agreement shall in the absence of manifest error be conclusive and binding
on the Pledgor.

 

12.                                        NOTICES

 

12.1                                    Each
notice or other communication to be given under this Agreement shall be given
in writing in English and, unless otherwise provided, shall be made by fax or
letter.

 

12.2                                    Any
notice or other communication to be given by one party to another under this
Agreement shall (unless one party has by 15 days’ notice to the other party
specified another address) be given to that other party at the respective
addresses given in Clause 12.3.

 

12.3                                    The
address and fax number of the Pledgor and the Pledgee are:

 

(A)            the Pledgor:

 

Concordia Bus Nordic Holding AB

 

Solna Strandväg 78, 171 54 Solna

 

Attention: Chairman of the Board

 

Fax: +46 8 546 300 10

 

(B)              the Pledgee:

 

Concordia Bus AB (publ)

 

Solna Strandväg 78, 171 54 Solna

 

Attention: Chairman of the Board

 

Fax: +46 8 546 300 10

 

9

 

12.4                                    Any
notice or other communication given by one party to another shall be deemed to
have been received:

 

a)                  if
sent by fax, with a confirmed receipt of transmission from the sending machine,
on the day on which transmitted;

 

b)                 in
the case of a notice given by hand, on the day of actual delivery; and

 

c)                  if
posted, on the second business day or, in the case of airmail, the fifth business
day following the day on which it was dispatched by first class mail postage
prepaid or, as the case may be, airmail postage prepaid,

 

provided that a notice given in accordance with the
above but received on a day which is not a business day or after normal
business hours in the place of receipt shall be deemed to have been received on
the next business day.

 

13.                                        GOVERNING LAW AND JURISDICTION

 

13.1                                    This
Agreement is governed by and shall be construed in accordance with Swedish law.

 

13.2                                    The
parties agree that the courts of Sweden shall have jurisdiction to settle any
disputes which may arise in connection with this Agreement and that any final (Sw: lagakraftvunnen) judgment or order of a Swedish court in
connection with this Agreement is conclusive and binding on them and may be
enforced against them in the courts of any other jurisdiction. This Clause 13.2
is for the benefit of the Secured Parties only and shall not limit the right of
any of the Secured Parties to bring proceedings against the Pledgor in
connection with any Finance Document in any other court of competent
jurisdiction or concurrently in more than one jurisdiction.

 

10

 

Signatories

 

 

The Pledgor

 

CONCORDIA BUS NORDIC
HOLDING AB

 

 

	
  /s/ FRODE LARSEN

  	
   

  

 

 

The Pledgee

 

CONCORDIA BUS AB (PUBL)

 

 

	
  /s/ FRODE LARSEN

  	
   

  

 

11

 

Schedule 1

 

FORM OF NOTICE

 

To:

 

Citicorp Trustee Company Limited

 

 

Dear Sirs,

 

This notice is
sent to you pursuant to a second ranking pledge agreement (the “Agreement”) made between and Concordia Bus Nordic Holding AB
(the “Pledgor”) and Concordia Bus AB (publ) (the
“Pledgee”) on [        ]
2005. Under the Agreement, the Pledgor has pledged, subject to the rights of the
Security Agent under a first ranking pledge (the “First Pledge”),
all the Pledgor’s rights under the Subordinated Loan granted to Concordia Bus Nordic AB
(publ) by the Pledgee on 27 February 2002 as amended and restated on [ 2005]
(the “Loan”), which has been transferred to
the Pledgor in accordance with a sale and assignment agreement dated [  2005].

 

Upon the
release of the First Pledge and for as long as the pledge created by the
Agreement remains in force you must deliver all payments under the Loan to no
one other than the Pledgee (or any third party other than the Pledgor directed
by the Pledgee). You may specifically not let the Pledgor, directly or through
a third party, receive payments under, or otherwise come into possession, of
the Loan.

 

Date: [  ]

 

Concordia Bus
Nordic Holding AB

 

	
   

  	
   

  
	
   

  
	
  Name:

  

 

 

We hereby
acknowledge receipt of this notice. We confirm that we undertake to act as
aforesaid throughout the term of the Agreement.

 

12

 

Date: [  ]

 

[the Pledgee]

 

 

	
   

  	
   

  
	
   

  
	
  Name:

  

 

13

 

Schedule 2

 

FORM OF NOTICE

 

To:

 

Concordia Bus Nordic AB
(publ)

 

 

Dear Sirs,

 

 

We hereby give you notice that by a second ranking pledge agreement of [  ] (the “Pledge Agreement”)
we have pledged, subject to the rights of the Security
Agent under a first ranking pledge (the “First Pledge”), to Concordia Bus AB (publ) (the “Pledgee”) as security for our obligations under a sale and
assignment agreement dated [  ] (the “Assignment Agreement”), all of our rights under the Subordinated
Loan granted to you by the Pledgee on 27 February 2002 as amended and
restated on [  2005] (the “Loan”), which has been transferred to us in accordance with
the Assignment Agreement.

 

The assets pledged consist of our claim on you under the Loan, and you
are therefore, upon the release of the First Pledge, to effect any payment
under the Loan in accordance with instructions received from the Pledgee (to
such account as the Pledgee or its nominee may from time to time designate in
writing for this purpose).

 

We kindly request that you confirm your receipt and acknowledgement of
the above by returning signed copies of this notification to the Pledgee and
ourselves.

 

Concordia Bus Nordic Holding
AB

 

 

	
   

  	
   

  
	
   

  
	
  by:

  

 

14

 

We hereby confirm our
receipt and acknowledgement of the above.

 

 

Concordia
Bus Nordic AB (publ)

 

 

	
   

  	
   

  
	
   

  
	
  by:

  

 

15Exhibit 4.10

 

CONFORMED
COPY

 

PLEDGE
AGREEMENT

 

 

Dated July 18, 2005

 

 

between

 

Concordia Bus Nordic Holding AB

 

as Pledgor

 

and

 

Concordia Bus AB

 

as Pledgee

 

 

SECOND RANKING
PLEDGE OF SHAREHOLDERS’ CONTRIBUTION LOAN

 

 

THIS SECOND RANKING PLEDGE AGREEMENT is dated July 18, 2005 and made
between:

 

(1)                                          CONCORDIA BUS NORDIC HOLDING
AB (a company
incorporated under the laws of Sweden) of c/o Swebus AB, Solna Strandväg 78,
171 54 Solna, Sweden (corporate identity no 556028-1122), (the “Pledgor”); and

 

(2)                                          CONCORDIA BUS AB (PUBL) (a company incorporated under the
laws of Sweden) of c/o Swebus AB, Solna Strandväg 78, 171 54 Solna, Sweden
(corporate identity no 556576-4569), (the “Pledgee”).

 

WHEREAS:

 

a)                            Concordia
Bus Nordic AB (publ) (“Nordic”) has
undertaken in February 2003 to make a shareholders’ contribution to the
Pledgee, none of which has been paid by Nordic on the date hereof and the
Pledgee consequently had a claim on Nordic in the same amount;

 

b)                           pursuant
to a sale and assignment agreement dated on or about the date (the “Transfer Agreement”) a part in the amount of SEK 80,000,000
(the “Loan”) of the Pledgee’s rights to the
Contribution has been assigned to the Pledgor and such part of the claim has
been evidenced by an agreement made between Nordic and the Pledgor dated on or
about the date hereof (the “Contribution Loan Agreement”);

 

c)                            the
Security Assets (as defined below) have been pledged, pursuant to a first
ranking pledge agreement dated on or about the date hereof (the “First Pledge Agreement”) to Citicorp Trustee Company
Limited in its capacity as security agent (the “Security
Agent”) under a mezzanine facility agreement made between the Pledgor
and the Pledgee as borrowers, Deutsche Bank Luxembourg S.A. as facility agent
and the Security Agent (the “Mezzanine Agreement”);
and

 

d)                           it
is a condition precedent of the Transfer Agreement that the Pledgor enters into
this Pledge Agreement and hereby secures the Secured Obligations (as defined
below).

 

IT IS HEREBY AGREED as follows:

 

1.                                               DEFINITIONS AND INTERPRETATION

 

1.1                                          In
this Agreement:

 

“Finance Documents”
means this Agreement and the Transfer Agreement;

 

2

 

“Secured Obligations”
means all present and future obligations and liabilities (whether actual or
contingent and whether owed jointly or severally or in any other capacity
whatsoever) of the Pledgor to the Pledgee under or pursuant to the Finance
Documents, in each case together with all costs, charges
and expenses incurred by the Pledgee in connection with the protection,
preservation or enforcement of its respective rights against the Pledgor under
the Finance Documents; and

 

“Security Assets”
means all the Pledgor’s rights under the Loan and the Contribution Loan
Agreement in respect thereof.

 

1.2                                          In
this Agreement, unless the contrary intention appears, a reference to:

 

a)                  a
provision of law is a reference to that provision as amended or re-enacted,

 

b)                 a
person includes its successors and assigns, and

 

c)                  any
document is a reference to that document as amended, novated or supplemented.

 

1.3                                          Terms
defined in the Transfer Agreement shall have the same meanings when used in
this Agreement unless otherwise defined in this Agreement.

 

1.4                                          If the Pledgee considers that in respect of an amount paid to the
Pledgee under a Finance Document there is a reasonable risk that such payment
will be avoided or otherwise set aside on the liquidation or bankruptcy of the payer
or otherwise, then that amount shall not be considered to have been irrevocably
paid for the purposes of this Agreement.

 

2.                                               PLEDGE

 

2.1                                          The
Pledgor hereby irrevocably and unconditionally, on the terms and conditions set
out herein, pledges to the Pledgee all of the Pledgor’s rights, title and
interest in and to the Security Assets for the purpose of constituting a second
ranking pledge, subject to the rights of the Security Agent under the First
Pledge Agreement, to secure the due and punctual performance of the Secured
Obligations.

 

2.2                                          Notwithstanding
anything to the contrary herein or under applicable law as to the priority of
the security granted by this Agreement, the security created hereunder is
subject to, and subordinated to, and will at all times rank junior to the
security under the First Pledge Agreement.

 

3

 

3.                                               PERFECTION OF PLEDGE

 

3.1                                          The
Pledgor shall immediately at the execution of this Agreement

 

a)                            notify
the Security Agent of the pledge created hereunder by sending a notice in
substantially the form set out in Schedule 1, and

 

b)                           notify
Nordic of the pledge created hereunder by sending a notice in substantially the
form set out in Schedule 2.

 

4.                                               REPRESENTATIONS AND WARRANTIES

 

4.1                                          The
Pledgor represents and warrants to the Pledgee that:

 

a)                  it
is a limited liability company duly incorporated and validly existing under the
laws of Sweden;

 

b)                 the
Pledgor has the power to enter into, deliver and perform, and has taken all
necessary action to authorize the entry into, delivery and performance of this
Agreement and the transactions contemplated by this Agreement;

 

c)                  this
Agreement constitutes legally valid and binding obligations of the Pledgor
enforceable in accordance with its terms (except as such enforcement may be
limited by any relevant bankruptcy, insolvency, receivership or similar laws
affecting creditors’ rights generally);

 

d)                 this
Agreement does not and will not breach or constitute a default under the
constitutional documents of the Pledgor or any law or regulation by which the
Pledgor is bound;

 

e)                  this
Agreement constitutes a second ranking pledge, subject to the rights of the
Security Agent and the secured parties under the First Pledge Agreement, enforceable
against the Pledgor, a liquidator or receiver of the Pledgor and third party
creditors of the Pledgor;

 

f)                    the
Pledgor is the sole, absolute and beneficial owner of the Security Assets; and

 

g)                 other
than as created pursuant to this Agreement and the First Pledge Agreement and
as otherwise permitted under the Mezzanine Agreement, the Security Assets are
free from any encumbrances.

 

4

 

5.                                               COVENANTS BY THE PLEDGOR

 

5.1                                          The
Pledgor hereby covenants with each of the Secured Parties that during the
continuance of this Agreement the Pledgor will:

 

a)                  not
sell, transfer or otherwise dispose of the Security Assets or any part thereof
or interest therein or permit the same to occur;

 

b)                 not
grant any option in or over the Security Assets;

 

c)                  not
create or permit to subsist any security interests on, over, with respect to or
otherwise affecting the whole or any part of the Security Assets (other than the
First Pledge Agreement and Permitted Security Interest as defined in the
Mezzanine Agreement and except for the rights of the Pledgee under this
Agreement, any secured party under a Permitted Security Interest (as defined in
the Mezzanine Agreement) and any secured party under the First Pledge Agreement);

 

d)                 not
hold any security from any other person in respect of the Pledgor’s liability
under this Agreement; and

 

e)                  the
Pledgor shall at any time, if and when required by the Pledgee and at the
Pledgor’s cost, promptly and duly do all such further acts and execute and
deliver any and all such further documents as may in the reasonable opinion of
the Pledgee be necessary in order to give full effect to this Agreement and to
secure to the Pledgee the full benefit of the rights, powers and remedies
conferred upon it in this Agreement, and the Pledgor shall use its best endeavours
to obtain any third party consent where such consent is required in order to
give full effect to such act or document.

 

5.2                                          Clause 5.1 is subject to Clause 19.18 of the Mezzanine Agreement, the
contents of which shall apply mutatis mutandis to the restrictions set out in
Clause 5.1.

 

6.                                               CONTINUING SECURITY

 

6.1                                          The
security constituted by this Agreement shall be a continuing security and shall
not be considered as satisfied or discharged by any intermediate payment or
settlement of the whole or any part of the Secured Obligations and shall be
binding until all the Secured Obligations have been irrevocably paid or discharged
in full.

 

6.2                                          Until
all the Secured Obligations have been irrevocably paid or discharged in full the
Pledgee may refrain from applying or enforcing any other security, monies or
rights held or received by the Pledgee or apply and enforce the same in such
manner and order as the Pledgee sees fit and the Pledgor shall not be entitled
to the benefit of the same and waives any right
it may have of first requiring the Pledgee

 

5

 

to
proceed against or enforce any other right or security or claim payment from
any other person before enforcing this Agreement.

 

6.3                                          This
Agreement is in addition to any present and future guarantee, collateral, lien
or other security held by the Pledgee. The Pledgee’s rights hereunder are in
addition to and not exclusive of those provided by law and may be exercised
from time to time and as often as the Pledgee deems expedient.

 

7.                                               EXERCISE OF PLEDGE AND APPLICATION OF MONIES

 

7.1                                          Upon
the Pledgee serving notice on the Pledgor following the occurrence of an event
of default under the Finance Documents, demanding the immediate repayment of
any outstanding amount of the Secured Obligations and at all times thereafter,
so long as the same shall be continuing, and subject to the rights of the
Security Agent under the First Pledge Agreement, the Pledgee may, in addition
to any other remedies provided in the Finance Documents or by applicable law enforce
its rights hereunder in such manner, acting with due care as the Pledgee in its
sole discretion deems fit, and the Pledgee shall not be liable for any loss
arising from or in connection with such enforcement, provided that it has acted
with due care.

 

7.2                                          All
costs and expenses (including legal fees) incurred by the Pledgee in connection
with the enforcement of the security created by this Agreement shall be borne
by the Pledgor and the Pledgor shall indemnify and hold the Pledgee harmless in
respect of such costs and expenses.

 

7.3                                          Chapter
10 Section 2 of the Swedish Commercial Code (Sw:
Handelsbalken 10:2) shall not apply to this Agreement.

 

7.4                                          All
monies received by the Pledgee under or by virtue of the pledge created by this
Agreement or by law or in exercise of the rights, powers and remedies under
this Agreement or by law shall be applied by the Pledgee in the manner and
order set out in the Assignment Agreement.

 

7.5                                          For the purpose of enforcing the security created by this Agreement upon
the occurrence of an event of default under the Finance Documents, the Pledgor
irrevocably authorizes and empowers the Pledgee to act in the name of the
Pledgor, and on behalf of the Pledgor to do all acts and take any necessary or
appropriate steps in respect of the sale of the Security Assets. The power of
attorney set out in this Clause 7.5 shall be valid for as long as this
Agreement remains in force.

 

6

 

8.                                               DISCHARGE OF THE SECURITY ASSETS

 

8.1                                          The
Pledgee may, and upon the irrevocable payment or discharge in full of the
Secured Obligations, shall or shall procure that its nominees or agents shall (as
the case may be) at the request and cost of the Pledgor discharge to the
Pledgor all the right, title and interest in or to the Security Assets of the Pledgee
free from the security in this Agreement.

 

8.2                                          Any
release, discharge or settlement between the Pledgor and Pledgee in relation to
this Agreement shall be conditional upon no disposition or payment to the Pledgee
by the Pledgor or any other person being avoided, set aside or ordered to be
refunded pursuant to any law relating to insolvency or for any other reason.

 

8.3                                          If
any such disposition or payment is avoided, set aside or ordered to be refunded
the Pledgor shall retransfer the Security Assets to the Pledgee and the Pledgee
shall be entitled to enforce this Agreement against the Pledgor as if such
release, discharge or settlement had not occurred and any such disposition or
payment not been made.

 

9.                                               WAIVERS

 

9.1                                          The
liability of the Pledgor under this Agreement shall not be prejudiced, affected
or diminished by any act, omission, circumstance or matter which but for this
provision might operate or release or otherwise exonerate the Pledgor from its
obligations under this Agreement in whole or in part, including without
limitation and whether or not known to the Pledgor or the Pledgee;

 

a)                  any
time or waiver granted to or composition with any other person;

 

b)                 the
taking, variation, compromise, renewal or release of or refusal or neglect to
perfect or enforce any rights, remedies or securities against any other person;

 

c)                  any
legal limitation, disability, incapacity or other circumstances or the
bankruptcy, liquidation or change in the name or constitution of any other person;

 

d)                 any
variation or extension, any increase, exchange, renewal, surrender, release or
loss of or failure to perfect any security or of any non-observance of any
formality in respect of any instruments; and

 

e)                  any
unenforceability or invalidity of the Secured Obligations or of any obligations
of any other person or security, to the intent that the Pledgor’s obligations
under this Agreement shall remain in full force and this

 

7

 

Agreement be
construed accordingly as if there were no such unenforceability or invalidity.

 

9.2                                          Any
waiver by the Pledgee of any terms of this Agreement or any consent or approval
given by any of them under it shall be effective only if given in writing and
then only for the purpose and upon the terms and conditions (if any) on which
it is given. No delay or omission on the part of the Pledgee in exercising any
right or remedy under this Agreement shall impair that right or remedy or
operate as or be taken to be a waiver of it nor shall any single, partial or
defective exercise of any such right or remedy preclude any other or further
exercise under this Agreement of that or any other right or remedy.

 

10.                                        INDEMNITY

 

The Pledgor shall,
in accordance with the terms of Clause 14.3 of the Mezzanine Agreement,
indemnify the Security Agent for any costs, expenses and liability as described
therein and for the purpose hereof any reference to “the Borrower” in Clause
14.3 shall be deemed to be a reference to the Pledgor and any reference to the
Finance Documents should be deemed to be a reference to this Agreement.

 

11.                                        MISCELLANEOUS

 

11.1                                    The
Pledgor may not assign any of its rights under this Agreement. The Pledgee may
assign all or any part of their rights under this Agreement in accordance with,
and in connection with a transfer under, the Transfer Agreement.

 

11.2                                    This
Agreement shall remain in full force and effect notwithstanding any amendments
or variations from time to time to any of the Finance Documents and all
references to a Finance Document herein shall be taken as referring to that
Finance Document as amended or varied from time to time (including, without
limitation, any increase in the amount of the Secured Obligations).

 

11.3                                    If
any provision of this Agreement is or becomes illegal, invalid or unenforceable
that shall not affect the validity or enforceability of any other provision of
this Agreement.

 

11.4                                    This
Agreement may be executed in any number of counterparts and this shall have the
same effect as if the signatures on the counterparts were on a single copy of
this Agreement.

 

11.5                                    All
sums payable by the Pledgor under this Agreement shall be paid without any set-off,
counterclaim, withholding or deduction whatsoever unless required by law in
which event the Pledgor will, simultaneously with making the relevant payment

 

8

 

under this
Agreement, pay to the Pledgee such additional amount as will result in the
receipt by the Pledgee of the full amount which would otherwise have been
receivable and will supply the Pledgee promptly with evidence satisfactory to
the Pledgee that the Pledgor has accounted to the relevant authority for the
sum withheld or deducted.

 

11.6                                    Any
statement, certificate or determination of the Pledgee as to the amount of the
Secured Obligations or (without limitation) any other matter provided for in
this Agreement shall in the absence of manifest error be conclusive and binding
on the Pledgor.

 

12.                                        NOTICES

 

12.1                                    Each
notice or other communication to be given under this Agreement shall be given
in writing in English and, unless otherwise provided, shall be made by fax or
letter.

 

12.2                                    Any
notice or other communication to be given by one party to another under this
Agreement shall (unless one party has by 15 days’ notice to the other party
specified another address) be given to that other party at the respective
addresses given in Clause 12.3.

 

12.3                                    The
address and fax number of the Pledgor and the Pledgee are:

 

(A)            the Pledgor:

 

Concordia Bus Nordic Holding AB

 

Solna Strandväg 78, 171 54 Solna

 

Attention: Chairman of the Board

 

Fax: +46 8 546 300 10

 

(B)              the Pledgee:

 

Concordia Bus AB (publ)

 

Solna Strandväg 78, 171 54 Solna

 

Attention: Chairman of the Board

 

Fax: +46 8 546 300 10

 

9

 

12.4                                    Any
notice or other communication given by one party to another shall be deemed to
have been received:

 

a) if sent by
fax, with a confirmed receipt of transmission from the sending machine, on the
day on which transmitted;

 

b) in the case of
a notice given by hand, on the day of actual delivery; and

 

c) if posted, on
the second business day or, in the case of airmail, the fifth business day
following the day on which it was dispatched by first class mail postage
prepaid or, as the case may be, airmail postage prepaid,

 

provided that a notice given in accordance with the
above but received on a day which is not a business day or after normal
business hours in the place of receipt shall be deemed to have been received on
the next business day.

 

13.                                        GOVERNING LAW AND JURISDICTION

 

13.1                                    This
Agreement is governed by and shall be construed in accordance with Swedish law.

 

13.2                                    The
parties agree that the courts of Sweden shall have jurisdiction to settle any
disputes which may arise in connection with this Agreement and that any final (Sw: lagakraftvunnen) judgment or order of a Swedish court in
connection with this Agreement is conclusive and binding on them and may be
enforced against them in the courts of any other jurisdiction. This Clause 13.2
is for the benefit of the Secured Parties only and shall not limit the right of
any of the Secured Parties to bring proceedings against the Pledgor in
connection with any Finance Document in any other court of competent
jurisdiction or concurrently in more than one jurisdiction.

 

10

 

Signatories

 

 

The Pledgor

 

CONCORDIA BUS NORDIC
HOLDING AB

 

 

	
  /s/ HARALD ARNKVAERN

  	
   

  

 

 

The Pledgee

 

CONCORDIA BUS AB (PUBL)

 

 

	
  /s/ HARALD ARNKVAERN

  	
   

  

 

11

 

Schedule 1

 

FORM OF NOTICE

 

To:

 

Citicorp Trustee Company Limited

 

 

Dear Sirs,

 

Concordia Bus
Nordic AB (publ) has undertaken to make a shareholders’ contribution to Concordia Bus
AB (publ) in the amount of SEK 108,273,353 and Concordia Bus AB (publ) has a
claim on Concordia Bus Nordic AB (publ) in that amount. Of that claim,
Concordia Bus AB (publ) has transferred to us all of its rights to an amount of
SEK 80,000,000 (the “Transferred Amount”)
and Concordia Bus Nordic AB’s (publ) obligation to pay the Transferred
Amount has been evidenced by a shareholders’ contribution loan agreement dated
on or about the date hereof.

 

This notice is
sent to you pursuant to a second ranking pledge agreement (the “Agreement”) made between Concordia Bus Nordic Holding AB (the
“Pledgor”) and Concordia Bus AB (publ) (the
“Pledgee”) on [        ] 2005. Under the Agreement, the Pledgor
has pledged, subject to the rights of the Security Agent under a first ranking
pledge (the “First Pledge”), all the Pledgor’s rights to the Transferred Amount
and under the shareholders’ contribution loan agreement in the respect thereof.

 

Upon the
release of the First Pledge and for as long as the pledge created by the
Agreement remains in force you must deliver all payments of the Transferred
Amount to no one other than the Pledgee (or any third party other than the
Pledgor directed by the Pledgee). You may specifically not let the Pledgor,
directly or through a third party, receive payments on, or otherwise come into
possession, of the Transferred Amount.

 

Date: [  ]

 

Concordia Bus
Nordic Holding AB

 

	
   

  	
   

  
	
   

  
	
  Name:

  

 

12

 

We hereby
acknowledge receipt of this notice. We confirm that we undertake to act as
aforesaid throughout the term of the Agreement.

 

Date: [  ]

 

Citicorp Trustee Company Limited

 

 

	
   

  	
   

  
	
   

  
	
  Name:

  

 

13

 

Schedule 2

 

FORM OF NOTICE

 

To:

 

Concordia Bus Nordic AB (publ)

 

 

Dear Sirs,

 

 

You have undertaken to make a shareholders’ contribution to Concordia
Bus AB (publ) in the amount of SEK 108,273,353 and Concordia Bus AB (publ) has
a claim on you in that amount. Of that claim, Concordia Bus AB (publ) has
transferred to us all of its rights to an amount of SEK 80,000,000 (the “Transferred Amount”) and your obligation to pay the
Transferred Amount has been evidenced by a shareholders’ contribution loan
agreement dated on or about the date hereof.

 

We hereby give you notice that by a second ranking pledge agreement of [  ] (the “Pledge Agreement”)
we have pledged, subject to the rights of the Security
Agent under a first ranking pledge (the “First Pledge”), to Concordia Bus AB (publ) (the “Pledgee”) as security for our obligations under a sale and
assignment agreement dated [  ] (the “Transfer Agreement”), all of our rights to the Transferred
Amount and under the shareholders’ contribution loan agreement in respect
thereof.

 

The assets pledged consist of our claim on you to payment of the Transferred
Amount, and you are therefore, upon the release of the First Pledge, to effect
any payment on the Transferred Amount in accordance with instructions received
from the Pledgee (to such account as the Pledgee or its nominee may from time
to time designate in writing for this purpose).

 

We kindly request that you confirm your receipt and acknowledgement of
the above by returning signed copies of this notification to the Pledgee and
ourselves.

 

14

 

Concordia Bus Nordic Holding AB

 

 

	
   

  	
   

  
	
   

  
	
  by:

  

 

 

We hereby confirm our receipt and acknowledgement of the above.

 

 

Concordia Bus Nordic AB (publ)

 

 

	
   

  	
   

  
	
   

  
	
  by:

  

 

15

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