Pledge And Escrow Agreement

Exhibit 4.4


EXECUTION COPY


SENIOR NOTE
PLEDGE AND ESCROW AGREEMENT


by and among


AMERISOURCEBERGEN CORPORATION,
AMERISOURCE HEALTH CORPORATION,
BERGEN BRUNSWIG CORPORATION,


CHASE MANHATTAN BANK AND TRUST COMPANY,
NATIONAL ASSOCIATION,
as Trustee,


and


CHASE MANHATTAN BANK AND TRUST COMPANY,
NATIONAL ASSOCIATION,
as Special Escrow Agent


Dated as of August 14, 2001


SENIOR NOTE
PLEDGE AND ESCROW AGREEMENT


THIS SENIOR NOTE PLEDGE AND ESCROW AGREEMENT (this "Agreement"), dated
--------- as of August 14, 2001, is by and among AmerisourceBergen Corporation (the "Company"), AmeriSource Health Corporation ("AmeriSource"), Bergen Brunswig ------- ----------- Corporation ("Bergen"), Chase Manhattan Bank and Trust Company, National
------ Association as trustee under the Indenture referred to below (the "Trustee"),
------- and Chase Manhattan Bank and Trust Company, National Association in its capacity as special escrow agent (the "Special Escrow Agent").
--------------------


RECITALS


A. The Notes. Pursuant to that certain Indenture, dated as of August
--------- 14, 2001, by and between the Company and the Trustee (as amended, supplemented, restated or otherwise modified from time to time, the "Indenture"), the Company
--------- will issue $500,000,000.00 in aggregate principal amount of 8 1/8% Senior Notes due 2008 (the "Notes"). Simultaneously with the issuance of the Notes on August
----- 14, 2001 (the "Deposit Time"): (i) all of the net proceeds from the sale of the
------------ Notes and (ii) an additional amount of $20,894,038.07 in cash or Government Securities (as defined herein) (the "Additional Escrow Amount" and,
------------------------ collectively, the "Escrow Funds") shall be deposited by the Company, AmeriSource
------------ and Bergen, jointly and severally, into a segregated trust account with the Special Escrow Agent at its office at San Francisco, California, Account No. 160594.1, in the name of Chase Manhattan Bank and Trust Company, National Association, as Trustee, "Collateral Account of Chase Manhattan Bank and Trust Company, National Association, as Trustee, for AmerisourceBergen Corporation Senior Note Holders" (together with any sub-accounts established by the Trustee or Special Escrow Agent in connection therewith, the "Special Escrow Account").
---------------------- The Special Escrow Account and all balances and investments from time to time therein shall be under the sole dominion and control of the Trustee. Subject to the terms and conditions hereinafter set forth, the funds on deposit from time to time in the Special Escrow Account shall be invested as directed by the Company or, in the absence of such directions, the Trustee. Capitalized terms used but not defined herein shall have the meanings assigned to them in the Indenture.


B. Purpose. The parties hereto desire to set forth their agreement
------- with regard to the administration of the Special Escrow Account, the creation of a security interest in the Collateral (as defined herein) and the conditions upon which funds will be released from the Special Escrow Account.


AGREEMENT


NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:


1. Security Interest.
-----------------


1.1 Pledge and Assignment. The Company hereby irrevocably
--------------------- pledges, assigns and sets over to the Trustee, and grants to the Trustee, for the ratable benefit of the Holders of the Notes, a continuing security interest in all of the Company's right, title and


interest in and to all of the following (whether consisting of investment securities, book-entry securities or other securities, security entitlements, financial assets or other investment property, accounts, general intangibles, instruments or documents, securities accounts, deposit accounts or other bank, trust or cash collateral accounts, or other property, assets or rights) whether now owned or existing or hereafter acquired or created (collectively, the "Collateral"): ----------


(a) this Agreement and the escrow created hereunder;


(b) the Special Escrow Account;


(c) all funds, securities, security entitlements and investment
property from time to time held in or credited to the Special Escrow
Account, including, without limitation, the Escrow Funds and the Government
Securities (as defined in Section 2.1) and all certificates and
instruments, if any, from time to time, representing or evidencing the
Special Escrow Account, the Escrow Funds or any of the foregoing, whether
the same shall constitute certificated securities, uncertificated
securities, investment property, financial assets, instruments, general
intangibles or otherwise;


(d) all promissory notes, certificates of deposit, deposit accounts,
checks, securities, security entitlements, investment property and
instruments from time to time hereafter delivered to or otherwise possessed
by the Trustee or the Special Escrow Agent in substitution for or in
addition to any or all of the then existing Collateral;


(e) all interest, dividends, cash, instruments, securities and other
property from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the then existing Collateral;
and


(f) all proceeds of the foregoing including, without limitation, all
cash proceeds and all non-cash proceeds thereof


(all of the property described in the preceding clauses (c), (d) and (e) and all proceeds thereof, collectively, the "Securities Collateral").
---------------------


The Company shall have no right to remove or withdraw any Securities Collateral from the Special Escrow Account without the prior written consent of the Trustee. If at any time the Special Escrow Agent shall receive any entitlement order from the Trustee (including, without limitation, any order directing the sale, transfer or redemption of any Securities Collateral), the Special Escrow Agent shall comply with such entitlement order, without the need for any consent by the Company or any other Person.


The Trustee hereby appoints the Special Escrow Agent to act as the Trustee's agent, on behalf of the Holders of the Notes, for purposes of perfecting the foregoing pledge, assignment and security interest in the Collateral, and the Special Escrow Agent hereby accepts such appointment. For so long as the foregoing pledge, assignment and security interest remains in effect, the Special Escrow Agent hereby waives any right of setoff or banker's lien that it, in its individual capacity or in its capacity as an agent for Persons other than the Trustee and the Holders of the Notes, may have with respect to any or all of the Collateral.


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1.2 Secured Obligations. This Agreement secures the due and punctual
------------------- payment and performance of all obligations and indebtedness of the Company, whether now or hereafter existing, under the Notes, the Indenture and this Agreement, including, without limitation, interest accrued thereon after the commencement of a bankruptcy, reorganization or similar proceeding involving the Company to the extent permitted by applicable law (collectively, the "Secured
------- Obligations"). -----------


1.3 Establishment of Special Escrow Account; Delivery of Collateral.
----------------------------------------------------------------


(a) Prior to the Deposit Time, the Special Escrow Agent shall establish the Special Escrow Account at its office at San Francisco, California as a "securities account" within the meaning of Article 8 of Uniform Commercial
------------------ Code (the "UCC") that is segregated from all other accounts of any kind. The
--- Special Escrow Agent will treat all property held by it in the Special Escrow Account as "financial assets" under Section 8-501(a) (or successor section) of
---------------- the UCC.


(b) All certificates or instruments, if any, representing or evidencing all or any portion of the Collateral shall be held by the Special Escrow Agent on behalf of the Trustee pursuant hereto and shall be in suitable form for transfer by delivery, or shall be accompanied by duly executed instruments of transfer or assignments in blank, all in form and substance reasonably satisfactory to the Trustee, and all in form and substance sufficient to convey a valid security interest in such Collateral to the Trustee.


(c) The Special Escrow Agent shall take all steps necessary to ensure that the Trustee is the holder or entitlement holder (as the case may be) of all of the Collateral and that (i) either the Trustee for the ratable benefit of the Holders of the Notes or, to the extent required by applicable law, the Special Escrow Agent, for the benefit of the Trustee and the ratable benefit of the Holders of the Notes, is the holder or entitlement holder of all Government Securities and other uncertificated securities on the books of the applicable Federal Reserve Bank or other applicable securities intermediary, and (ii) all Securities Collateral is credited to the Special Escrow Account in the Trustee's name on the Special Escrow Agent's books.


(d) Subject to the other terms and conditions of this Agreement, (i) all Securities Collateral held by the Special Escrow Agent pursuant to this Agreement shall be held in the Special Escrow Account which shall be subject to the exclusive dominion and control of the Trustee for the benefit of the Trustee and the ratable benefit of the Holders of the Notes, and (ii) the Special Escrow Account and all Securities Collateral from time to time therein shall remain segregated from all other funds or other property otherwise held by the Trustee or the Special Escrow Agent, as applicable. All proceeds of the Escrow Funds and other Securities Collateral, and all cash proceeds thereof, shall remain on deposit in the Special Escrow Account until withdrawn in accordance with this Agreement.


1.4 Further Assurances. Prior to, contemporaneously herewith, and
------------------ at any time and from time to time hereafter, the Company shall, at the Company's expense, execute and deliver to the Trustee or its designee such other instruments and documents, and take all further action as the Trustee deems reasonably necessary or advisable or may reasonably request to confirm or perfect the security interest of the Trustee granted or purported to be granted hereby


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or to enable the Trustee to exercise and enforce its rights and remedies hereunder with respect to any Collateral, and the Company shall take all necessary action to preserve and protect the security interest created hereby as a first priority, perfected lien and encumbrance upon the Collateral.


1.5 Maintaining the Special Escrow Account. So long as this
-------------------------------------- Agreement is in full force and effect:


(a) the Company shall establish and maintain the Special Escrow
Account with the Special Escrow Agent in accordance with Section 1.3
hereof, and the Special Escrow Account shall at all times remain under the
exclusive dominion and control of the Trustee; and


(b) notwithstanding any term or condition to the contrary in any
other agreement relating to the Special Escrow Account, except as otherwise
provided by the provisions of Article 3 hereof, no amount (including,
without limitation, any Escrow Funds or interest on or other proceeds of
the Escrow Funds or on any investment property held in the Special Escrow
Account) shall be paid or released to or for the account of, or withdrawn
by or for the account of, the Company or any other Person other than the
Trustee or its designee from the Special Escrow Account (other than
customary brokerage or similar fees, discounts or commissions payable in
connection with investments of funds pursuant to Section 2.1 hereof).


1.6 Transfers and Other Liens. The Company agrees that it will not
------------------------- (i) sell, assign (by operation of law or otherwise) or otherwise dispose of, or grant any option with respect to, any of the Collateral or (ii) create or permit to exist any Lien upon or with respect to any of the Collateral, except for the security interest under this Agreement.


1.7 Attorneys-in-Fact. The Company hereby irrevocably appoints each
----------------- of the Trustee and the Special Escrow Agent as the Company's attorney-in-fact, coupled with an interest, with full authority in the place and stead of the Company and in the name of the Company or otherwise, from time to time in the Trustee's or the Special Escrow Agent's discretion to take any action and to execute any instrument which the Trustee or the Special Escrow Agent may deem necessary or advisable to accomplish the purposes of this Agreement, including, without limitation, to receive, endorse and collect all instruments made payable to the Company representing any interest payment, dividend or other distribution in respect of the Collateral or any part thereof and to give full discharge for the same, and the expenses of the Trustee and the Special Escrow Agent incurred in connection therewith shall be payable by the Company.


1.8 Trustee or Special Escrow Agent May Perform. Without limiting
------------------------------------------- the authority granted under Section 1.7 hereof and except with respect to the failure of the Company to deliver investment instructions, which shall be governed by the second paragraph of Section 2.1 hereof, if the Company fails to perform any agreement contained herein, the Trustee or the Special Escrow Agent may, but shall not be obligated to, itself perform, or cause performance of, such agreement, and the expenses of the Trustee or the Special Escrow Agent incurred in connection therewith shall be payable by the Company and shall be secured by the Collateral.


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1.9 Financing Statements. In addition to, and not in limitation of,
-------------------- any other provision of this Agreement, the Company hereby authorizes the Trustee to file one or more UCC financing statements with or (to the fullest extent permitted by applicable law) without the Company's signature, describing the Collateral and naming the Company, as debtor, and the Trustee, as secured party, for purposes of perfecting the Trustee's security interest in all or any portion of the Collateral. In connection therewith: (a) the Company hereby represents and warrants to the Trustee that (i) the Company is incorporated under the laws of the State of Delaware, and (ii) the Company's chief executive office is located at 1300 Morris Drive, Suite 100, Chesterbrook, Pennsylvania 19087-5594, which is in Chester County in the Commonwealth of Pennsylvania, and (b) the Company hereby covenants and agrees that it will not change its name, identity or structure (within the meaning of Article 9 of any applicable enactment of the UCC) or, at any time while the location of its chief executive office remains relevant to perfection of the Trustee's security interest in any portion of the Collateral, relocate its chief executive office unless it shall have: (A) given the Trustee at least 5 business days' prior notice thereof and (B) prior to effectiveness of such change, delivered to the Trustee all financing statements, instruments and other documents reasonably requested by the Trustee in connection with such change or relocation.


2. Investment and Liquidation of Funds in Special Escrow Account. Funds
------------------------------------------------------------- deposited in the Special Escrow Account shall be invested and reinvested by the Special Escrow Agent on the following terms and conditions:


2.1 Permitted Investments. Prior to the earliest to occur of (i)
--------------------- an event described in Section 3.4(a) hereof, (ii) an event described in Section 3.4(b) hereof, or (iii) an Event of Default under the Indenture, the Company hereby directs the Special Escrow Agent to invest all funds on deposit in the Special Escrow Account in the name of the Trustee solely in direct obligations of, or obligations guaranteed by, the United States of America, and the payment for which the United States pledges its full faith and credit ("Government
---------- Securities") maturing not later than twelve months after the date of acquisition ---------- and the Special Escrow Agent hereby agrees to make such investments in the name of the Trustee.


(a) Notwithstanding the foregoing, if, on or prior to 12:00 noon (New York City time) on the 85th day after the Deposit Time, the Trustee receives from the chief financial officer of the Company a certificate substantially in the form of Exhibit A hereto (a "Preliminary Release Certificate") that:
--------- -------------------------------


(i) sets forth the date (the "Merger Closing Date") for the
-------------------
consummation of the merger (the "Merger") contemplated by the
------
Agreement and Plan of Merger among AABB Corporation (now named
AmerisourceBergen Corporation), AmeriSource, Bergen, A-Sub Acquisition
Corp. and B-Sub Acquisition Corp., dated March 16, 2001 (the "Merger
------
Agreement"), which shall not be earlier than two (2) Business Days
---------
after the Special Escrow Agent's receipt of such Preliminary Release
Certificate by 12:00 noon (New York City time);


(ii) states that the Company reasonably believes that the Merger will
be consummated on the specified Merger Closing Date;


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(iii) sets forth the date (the "Supplemental Indenture Execution
--------------------------------
Date") for the execution and delivery of the Notation of Guarantee (as
----
hereinafter defined) and the Supplemental Indenture (as hereinafter
defined) by each of the guarantors (the "Guarantors") named in the
----------
Purchase Agreement dated August 9, 2001 among the Company,
AmeriSource, Bergen, and the several Initial Purchasers named therein
(the "Purchase Agreement");
------------------


(iv) states that the Company reasonably believes that the Notation of
Guarantee and the Supplemental Indenture will be executed and
delivered by each of the Guarantors on the Supplemental Indenture
Execution Date; and


(v) directs the liquidation of all of the Government Securities in
accordance with Section 3.1 hereof,


the Company may thereafter direct the Special Escrow Agent to invest the funds from time to time in the Special Escrow Account solely in the Government Securities maturing on or before 12:00 noon (New York City time) on the later to occur of the Merger Closing Date or the Supplemental Indenture Execution Date (such later date, the "Release Date"); provided, however, that if the Company
------------ -------- ------- fails to give written investment instructions to the Special Escrow Agent by 12:00 noon (New York City time) on any Business Day prior to the Release Date on which there is uninvested cash and/or maturing Government Securities in the Special Escrow Account, the Trustee is hereby authorized to instruct the Special Escrow Agent in writing to invest any such amounts in the Government Securities, subject to the same maturity constraints as were imposed on the Company. Any failure by the Company or the Trustee to give such investment instructions to the Special Escrow Agent shall not constitute a default or an event of default hereunder or under the Indenture.


2.2 Interest. All interest earned on funds invested in Government
-------- Securities shall be held in the Special Escrow Account and reinvested in accordance with the terms hereof and will be subject to the security interest granted hereunder to the Trustee.


2.3 Limitation of Trustee's and Special Escrow Agent's Liability.
------------------------------------------------------------ In no event shall the Trustee or the Special Escrow Agent have any liability to the Company or any other Person for investing the funds from time to time in the Special Escrow Account in accordance with the provisions of this Article 2, regardless of whether greater income or a higher yield could have been obtained had the Special Escrow Agent invested such funds in different Government Securities, o ...