EXHIBIT 99.3
EXECUTION COPY
BLOCKED ACCOUNT CONTROL AND
SECURITY AGREEMENT
BLOCKED ACCOUNT CONTROL AND SECURITY
AGREEMENT dated as of April 22, 2005 (this “ Agreement
”), by and between The Nasdaq Stock Market, Inc., a Delaware
corporation (the “ Guarantor ”), and JPMorgan
Chase Bank, N.A. (“ JPMCB ”), in its capacity as
administrative agent under the Term Loan Agreement referred to
below (the “ Administrative Agent ”), and JPMCB,
in its capacity as the “Securities intermediary” (as
defined in Section 8-102 of the UCC) and/or the “Bank”
(as defined in Section 9-102 of the UCC) (in such capacities, the
“ Financial Institution ”).
Reference is made to (i) the Secured
Term Loan Agreement dated as of April 22, 2005 (as amended,
supplemented or otherwise modified from time to time, the “
Term Loan Agreement ”), among Norway Holdings SPV, LLC
(“ Holdings ”), Norway Acquisition SPV, LLC (the
“ Borrower ”), the lenders from time to time
party thereto (the “ Lenders ”) and JPMCB, as
Administrative Agent and (ii) the Guarantee Agreement dated as of
April 22, 2005 (as amended, supplemented or otherwise modified from
time to time, the “ Guarantee Agreement ”),
among the Guarantor, the Borrower and JPMCB, as Administrative
Agent. Capitalized terms used herein and not defined herein shall
have the meanings assigned to such terms in the Term Loan
Agreement. All references herein to the “UCC” shall
mean the Uniform Commercial Code as in effect in the State of New
York.
Pursuant to (a) an Agreement and
Plan of Merger (the “ Merger Agreement ”) dated
as of the date hereof among the Guarantor, Norway Acquisition
Corp., a Delaware corporation and a direct wholly owned subsidiary
of the Guarantor (“ Merger Sub ”), and Instinet
Group Incorporated, a Delaware corporation (the “
Seller ”), Merger Sub will merge with and into the
Seller, with the Seller surviving such merger as a wholly owned
subsidiary of the Guarantor (the “ Acquisition
”) and (b) a Transaction Agreement (the “ VAB
Transaction Agreement ”) to be entered into among the
Guarantor, Merger Sub and Iceland Acquisition Corp., a Delaware
corporation (“ VAB Acquisition Sub ”) all the
capital stock of which is owned by affiliates of Silver Lake
Partners, the Guarantor will, immediately upon completion of the
Acquisition, sell the assets, liabilities and capital stock of the
subsidiaries of the Seller that comprise its VAB business to VAB
Acquisition Sub.
In order to obtain a portion of the
financing for the Acquisition, the Guarantor will issue on the
Effective Date $205,000,000 aggregate principal amount of newly
issued Convertible Notes, together with the Warrants, to the
Borrower for an aggregate purchase price of $205,000,000 in cash.
The Borrower has requested the Lenders to extend credit, subject to
the terms and conditions specified in the Term Loan Agreement, in
the form of the Loans on the Effective Date, the proceeds of which
will be deposited by the Administrative Agent directly in the
Blocked Account (as defined herein) in satisfaction of the
Borrower’s obligations to pay the purchase price of the
Convertible Notes and the Warrants. The Loans shall be (a) secured
by the Convertible Notes and the Warrants and (b) guaranteed by (i)
the Guarantor, which guarantee shall be secured by the cash
deposited in the Blocked Account, which shall include the proceeds
from the sale of the Convertible Notes and the Warrants and the
Additional Amounts, and (ii) Holdings, which guarantee shall be
secured by the Borrower Equity.
In connection with the foregoing,
Holdings has obtained the Sponsor Commitment Letter pursuant to
which the Sponsors commit to provide to Holdings, and Holdings
commits to provide to the Borrower, a cash contribution in an
amount of not less than $205,000,000 upon the consummation of the
Acquisition. In the event the Acquisition shall not have been
consummated on or prior to the Maturity Date, the Convertible Notes
shall be redeemed by the Guarantor at the adjusted issue price
thereof plus accrued interest.
The Guarantor acknowledges that (a)
it will derive substantial benefit from the making of the Loans by
the Lenders and (b) the Lenders have agreed to make Loans on the
condition that, among other things, the Guarantor executes and
delivers a Blocked Account Control and Security Agreement in the
form hereof. As consideration therefor and in order to induce the
Lenders to agree to make the Loans, the Guarantor is willing to
execute this Agreement.
The parties hereto refer to Account
No. 10221794 in the name of “The Nasdaq Stock Market,
Inc.” established hereby and maintained at the Financial
Institution (the “ Blocked Account ”) and hereby
agree as follows:
1. On the Effective Date, (i) the
Administrative Agent will deposit the proceeds of the Loans
directly in the Blocked Account and (ii) the Guarantor will deposit
the Additional Amounts (which will equal $2,400,000) directly in
the Blocked Account.
2. As security for the payment or
performance, as the case may be, in full of the Obligations, the
Guarantor hereby assigns and pledges to the Administrative Agent,
its successors and assigns, for the benefit of the Lenders, and
hereby grants to the Administrative Agent, its successors and
assigns, for the benefit of the Lenders, a security interest (the
“ Security Interest ”) in, all right, title or
interest in or to the Blocked Account (and any successor account)
and all cash and cash equivalents and proceeds thereof now or
hereafter held in or constituting part of or relating to the
Blocked Account (and any successor account) (the “ Blocked
Account Collateral ”).
3. The Financial Institution shall
not change the name or account number of the Blocked Account
without the prior written consent of the Administrative Agent. The
Financial Institution acknowledges and agrees that the Blocked
Account is intended to be a deposit account. Notwithstanding such
intention, as used herein (i) ”Deposit Account” shall
mean the Blocked Account if it is determined to be a “deposit
account” (within the meaning of Section 9-102(a)(29) of the
UCC) and (ii) ”Securities Account” shall mean the
Blocked Account if it is determined to be a “securities
account” (within the meaning of Section 8-501 of the
UCC).
4. All securities or other property
underlying any financial assets credited to the Blocked Account
shall be registered in the name of the Financial Institution,
indorsed to the Financial Institution or in blank or credited to
another securities account maintained in the name of the Financial
Institution and in no case will any financial asset credited to the
Blocked Account be registered in the name of the Guarantor, payable
to the order of the Guarantor or specially indorsed to the
Guarantor.
5. The Financial Institution hereby
agrees that each item of property (whether investment property,
financial asset, security, instrument or cash) credited to the
Blocked Account if it is determined to be a Securities Account
shall be treated as a “financial asset” within the
meaning of Section 8-102(a) (9) of the UCC.
6. During the term of this
Agreement, the Blocked Account Collateral shall be invested and
reinvested by the Financial Institution in a JPMorgan Trust Account
returning one month LIBOR less 25 basis points, computed daily. And
all amounts received in respect of such investment and reinvestment
shall be deposited in the Blocked Account and shall constitute
Blocked Account Collateral.
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7. The Security Interest is granted
as security only and shall not subject the Administrative Agent or
any of the Lenders to, or in any way alter or modify, any
obligation or liability of the Guarantor with respect to or arising
out of the Blocked Account.
8. The Security Interest constitutes
a legal and valid security interest in the Blocked Account securing
the payment and performance of the Obligations. The Blocked Account
is owned by the Guarantor free and clear of any Lien (other than
the Security Interest). The Guarantor shall, at its own cost and
expense, take any and all actions necessary to defend title to the
Blocked Account against all persons and to defend the Security
Interest of the Administrative Agent in the Blocked Account and the
priority thereof against any other Lien.
9. Upon the occurrence and during
the continuance of an Event of Default, the Guarantor agrees that
the Administrative Agent shall have the right to, or at the request
of the Required Lenders, the Administrative Agent will, subject to
the mandatory requirements of applicable law, foreclose on the
Blocked Account and apply the proceeds thereof to pay in full in
cash all the Obligations.
10. The Guarantor shall remain
liable to, at its own cost and expense, duly and punctually,
observe and perform all the conditions and obligations to be
observed and performed by it under each contract, agreement or
instrument relating to the Blocked Account, all in accordance with
the terms and conditions thereof, and the Guarantor agrees to
indemnify and hold harmless the Administrative Agent and the
Lenders from and against any and all liability for such
performance; provided , however , that the Guarantor
shall not be liable for, or indemnify the Administrative Agent with
respect to, any liability resulting from the Administrative
Agent’s gross negligence or wilful misconduct as found in a
final judgment of a court.
11. All rights of
