EXHIBIT 10.2
PLEDGE AND SECURITY AGREEMENT
GRANTOR: SMK GROUP, LLC
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LENDER: THERMOTREX CORPORATION
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THIS PLEDGE AND SECURITY AGREEMENT is entered into between SMK GROUP, LLC
referred to below as "Grantor"); and THERMOTREX CORPORATION (referred to below
as "Lender").
▇. ▇▇▇▇▇ OF SECURITY INTEREST. For valuable consideration, Grantor
grants to Lender a security interest in the Collateral to secure the
Indebtedness and agrees that Lender shall have the rights stated in this
Agreement with respect to the Collateral, in addition to all other rights which
Lender may have by law.
B. DEFINITIONS. The following words shall have the following
meanings when used in this Agreement:
1. Agreement. The word "Agreement" means this Pledge and Security
Agreement, as this Pledge and Security Agreement may be amended or modified from
time to time, together with all exhibits and schedules attached to this
commercial Pledge and Security Agreement from time to time.
2. Collateral. The word "Collateral" means 806,800 shares of
common stock of ThermoLase Corporation, which Grantor has delivered or agrees to
deliver (or cause to be delivered or appropriate book-entries made) immediately
to Lender.
3. Event of Default. The words "Event of Default" means and
include without limitation any of the Events of Default set forth below in
the section titled "Events of Default."
4. Grantor. The word "Grantor" means SMK GROUP LLC, a
Delaware limited liability company.
5. Income and proceeds. The words "Income and proceeds" mean all
present and future income, proceeds, earnings, increases, and substitutions from
or for the Collateral of every kind and nature, including without limitation all
payments, profits, distributions, benefits, rights, options, warrants,
dividends, stock dividends, stock splits, stock rights, regulatory dividends,
distributions, subscriptions, monies, claims for money due and to become due,
shares of stock of different par value or no par value issued in substitution or
exchange for the Collateral.
6. Indebtedness. The word "Indebtedness" means only the
indebtedness evidenced by the Note, including all principal and interest,
together with all costs and expenses for which Grantor is responsible under this
Agreement or under the Note.
7. Lender. The word "Lender" means THERMO ELECTRON
CORPORATION, a Delaware corporation.
8. Note. The word "Note" means the Note dated July 7, 1998
between Grantor and Lender.
C. GRANTOR'S REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE
COLLATERAL. Grantor represents and warrants to Lender that:
1. Ownership. Grantor is the lawful owner of the Collateral
free and clear of all security interests, liens, encumbrances and claims of
others.
2. Right to Pledge. Grantor has the full right, power and
authority to enter into this Agreement and to pledge the Collateral.
3. Binding Effect. This Agreement is binding upon Grantor, as
well as Grantor's successors, representatives and assigns, and is legally
enforceable in accordance with its terms.
4. No Further Assignment. Grantor has not, and will not, sell,
assign, transfer, encumber or otherwise dispose of any of Grantor's rights in
the Collateral except as provided in this Agreement.
5. No Violation. The execution and delivery of this Agreement
will not violate any law or agreement governing Grantor or to which Grantor
is a party.
D. THE RIGHTS AND OBLIGATIONS OF LENDER AND GRANTOR WITH RESPECT TO
COLLATERAL.
1. Lender may hold the Collateral until the Indebtedness has been
paid and satisfied and thereafter shall deliver the Collateral to the Grantor.
However, during the term of this Agreement Grantor shall have the right to vote
the shares of stock held as Collateral and exercise all other rights of
ownership over the Collateral except as restricted by the terms of this
Agreement.
2. Commencing July 7, 1999, upon the request of Grantor, Lender
shall sell part or all of the Collateral in such amounts and in accordance with
Grantor's instructions, and apply the net proceeds of such sales to the amounts
due under the Note in accordance with its terms.
3. Upon Grantor's request Lender shall release to Grantor all
Collateral in excess of two hundred percent (200%) of the amount of the
Indebtedness due under the Note at the time of Grantor's request for the release
of Collateral.
4. Income and Proceeds from the Collateral. All Income and
Proceeds received, paid, or delivered in substitution or in exchange of the
Collateral shall be received by or delivered to Lender as Collateral hereunder
unless cash is so received, paid or delivered in substitution or exchange of the
Collateral, then it shall be applied to the outstanding amounts due under the
Note, in accordance with its terms. All Income and Proceeds from the Collateral
which may be received by, paid, or delivered as an addition to the Collateral
(such as dividends) shall be paid to, received by or delivered to Grantor.
5. Perfection of Security Interest. Upon request of Lender,
Grantor will deliver to Lender any and all of the documents evidencing or
constituting the Collateral. When applicable law provides more than one method
of perfection of Lender's security interest, Lender may choose the method(s) to
be used. Upon request of Lender, Grantor will sign and deliver any writings
necessary to perfect Lender's security interest. If the Collateral consists of
securities for which no certificate has been issued, Grantor agrees, at Lender's
option, either to request issuance of an appropriate certificate or to execute
appropriate instructions on Lender's forms instructing the issuer, to record on
its books or records, by book-entry or otherwise, Lender's security interest in
the Collateral. Grantor hereby appoints Lender as Grantor's irrevocable
attorney-in-fact for the purpose of executing any documents necessary to perfect
or to continue the security interest granted in this Agreement.
E. EXPENDITURES BY LENDER. If not discharged or paid when due, Lender
may (but shall not be obligated to) discharge or pay any amounts required to be
discharged or paid by Grantor under this Agreement or the Note, including
without limitation all taxes, liens, security interests, encumbrances, and other
claims, at any time levied or placed on the Collateral. All such expenditures
incurred or paid by Lender for such purposes will then bear interest at the rate
charged under the Note from the date incurred or paid by Lender to the date of
repayment by Grantor. All such expenses shall become a part of the Indebtedness
and, at Lender's option, will be added to the balance of the Note due and
payable at the Note's maturity. This Agreement also will secure payment of these
amounts. Such right shall be in addition to all other rights and remedies to
which Lender may be entitled upon the occurrence of an Event of Default.
F. LIMITATIONS ON OBLIGATIONS OF LENDER. Lender shall use ordinary
reasonable care in the physical preservation and custody of the Collateral in
Lender's possession, but shall have no other obligation to protect the
collateral or its value and Lender shall have no liability for depreciation or
deterioration of the Collateral.
G. EVENTS OF DEFAULT. Each of the following shall constitute an
Event of Default under this Agreement:
1. Default under the Note. The occurrence of an Event of Default
under the Note, in accordance with its terms.
2. Other Defaults. Failure of Grantor to comply with or to
perform any other term, obligation, covenant or condition contained in this
Agreement after receipt of a notice of its failure to comply and a reasonable
opportunity to cure such failure.
3. Insolvency. The dissolution or termination of Grantor's
existence, the insolvency of Grantor, the appointment of a receiver for any part
of Grantor's property, any assignment for the benefit of creditors, any type of
creditor workout, or the commencement of any proceeding under any bankruptcy or
insolvency laws by or against Grantor.
4. Creditor or Forfeiture Proceedings. Commencement of
foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help
repossession or any other method, by any creditor of Grantor or by any
governmental agency against the Collateral or any other collateral securing the
Indebtedness. This includes a garnishment of any of Grantor's deposit account
with Lender.
H. RIGHTS AND REMEDIES ON DEFAULT. If an Event of Default occurs under
this Agreement, at any time thereafter, Lender may exercise any one or more of
the following rights and remedies:
1. Collect the Collateral. Collect and retain possession of
the Collateral.
2. Sell the Collateral. Sell the Collateral, at Lender's
discretion, as a unit or in parcels, at one or more public or private sales.
Lender shall give or mail to Grantor, notice at least ten (10) days in advance
of the time and place of any public sale, or of the date after which any private
sale may be made. Grantor agrees that any requirement of reasonable notice is
satisfied if Lender mails notice by ordinary mail addressed to Grantor, or any
of them, at the last address Grantor has given Lender in writing.
3. Register Securities. Register any securities included in
the Collateral in Lender's name and exercise any rights normally incident to
the ownership of securities.
4. Sell Securities. Sell any securities included in the
Collateral in a manner consistent with applicable federal and state securities
laws, notwithstanding any other provision of this or any other agreement. If,
because of restrictions under such laws, Lender is or believes it is unable to
sell the securities in an open market transaction, Grantor agrees that Lender
shall have no obligation to delay sale until the securities can be registered,
and may make a private sale to one or more persons or to a restricted group of
persons, even though such sale may result in a price that is less favorable than
might be obtained in an open market transaction, and such a sale shall be
considered commercially reasonable.
5. Other Rights and Remedies. Have and exercise any or all of the
rights and remedies of a secured creditor under the provisions of the Uniform
Commercial Code, at law, in equity, or otherwise.
6. Application of Proceeds. Apply any cash which is received from
the collection or sale of the Collateral, to reimbursement of any expenses,
including any costs for registration of securities, commissions incurred in
connection with a sale, reasonable attorney fees, and court costs, whether or
not there is a lawsuit and including any fees on appeal, incurred by Lender in
connection with the collection and sale of such Collateral and to the payment of
the Indebtedness of Grantor to Lender, with any excess funds to be paid to
Grantor as the interest of Grantor may appear.
7. Cumulative Remedies. All of Lender's rights and remedies,
whether evidenced by this Agreement or by any other writing, shall be cumulative
and may be exercised singularly or concurrently. Election by Lender to pursue
any remedy shall not exclude pursuit of any other remedy, and an election to
make expenditures or to take action to perform an obligation of Grantor under
this Agreement, after Grantor's failure to perform, shall not affect Lender's
right to declare a default and to exercise its remedies.
8. Limitation of Liability. Grantor's liability hereunder and
under the Note is strictly limited to the Collateral pledged hereunder and shall
not extend in any way to any other assets or property of the Maker, its members
or any officers, directors, agents or trustee thereof.
I. MISCELLANEOUS PROVISIONS. The following miscellaneous provisions
are a part of this Agreement:
1. Amendments. This Agreement, together with the Note,
constitutes the entire understanding and agreement of the parties as to the
matters set forth in this Agreement. No alteration of or amendment to this
Agreement shall be effective unless given in writing and signed by the party or
parties sought to be charged or bound by the alteration or amendment.
2. Applicable Law. If there is a lawsuit, Grantor agrees upon
Lender's request to submit to the jurisdiction of the courts of the Commonwealth
of Massachusetts. Lender and Grantor hereby waive the right to any jury trial in
any action, proceeding, or counterclaim brought by either Lender or Grantor
against the other. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts.
3. Caption Headings. Caption headings in this Agreement are
for convenience purposes only and are not to be used to interpret or define
the provisions of this Agreement.
4. Notices. All notices required to be given under this Agreement
shall be given in writing, may be sent by facsimile (unless otherwise required
by law), and shall be effective when actually delivered or when deposited with a
nationally recognized overnight courier or deposited in the United States mail,
first class, postage prepaid, addressed to the party to whom the notice is to be
given at the address shown above. Any party may change its address for notices
under this Agreement by giving formal written notice to the other parties,
specifying that the purpose of the notice is to change the party's address. To
the extent permitted by applicable law, if there is more than one Grantor,
notice to any Grantor will constitute notice to all Grantors. For notice
purposes, Grantor will keep Lender informed at all times of Grantor's current
address(es).
5. Severability. If a court of competent jurisdiction finds any
provision of this Agreement to be invalid or unenforceable as to any person or
circumstance, such finding shall not render that provision invalid or
unenforceable as to any other persons or circumstances. If feasible, any such
offending provision shall be deemed to be modified to be within the limits of
enforceability or validity; however, if the offending provision cannot be so
modified, it shall be stricken and all other provisions of this Agreement in all
other respects shall remain valid and enforceable.
6. Successor Interests. The terms of this Agreement shall be
binding upon Grantor, and upon Grantor's personal representatives, successors,
and assigns, and shall be enforceable by Lender and its successors and assigns.
7. Waiver. Lender shall not be deemed to have waived any rights
under this Agreement unless such waiver is given in writing and signed by
Lender. No delay or omission on the part of Lender in exercising any right shall
operate as a waiver of such right or any other right. A waiver by Lender of a
provision of this Agreement shall not prejudice or constitute a waiver of
Lender's right otherwise to demand strict compliance with that provision or any
other provision of this Agreement. No prior waiver by Lender, nor any course of
dealing between Lender and Grantor, shall constitute a waiver of any of Lender's
rights or of any of Grantor's obligations as to any future transactions.
Whenever the consent of Lender is required under this Agreement, the granting of
such consent by Lender in any instance shall not constitute continuing consent
to subsequent instances where such consent is required and in all cases such
consent may be granted or withheld in the sole discretion of Lender.
J. GRANTOR AND LENDER ACKNOWLEDGE HAVING READ ALL THE PROVISIONS OF
THIS PLEDGE AND SECURITY AGREEMENT, AND EACH AGREES TO ITS TERMS. THIS
AGREEMENT IS DATED JULY 7, 1998. .
THIS AGREEMENT HAS BEEN SIGNED AND SEALED BY THE UNDERSIGNED.
GRANTOR:
SMK GROUP LLC
By: Its Members:
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
The ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Trust
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Trustee
LENDER:
THERMOTREX CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Chairman
