STOCK PLEDGE AGREEMENT
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STOCK PLEDGE AGREEMENT, dated as of December 8, 1998, between CONMAT
TECHNOLOGIES, INC., a Florida corporation ("Pledgor"), and GENERAL ELECTRIC
CAPITAL CORPORATI0N a New York corporation ("Lender").
W I T N E S S E T H
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WHEREAS, Pledgor is the record and beneficial owner of the shares of
common stock described in Schedule I hereto (the "Pledged Shares") issued by
Polychem Corporation ("Borrower");
WHEREAS, Borrower and Lender have entered into a Loan and Security
Agreement, dated as of September 30, 1998 (as at any time amended, modified or
supplemented, the "Loan Agreement"), pursuant to which Lender has agreed to make
Revolving Credit Advances and a Term Loan (as defined in the Loan Agreement), to
Borrower (collectively, the "Loans") the proceeds of which are to be used in
connection with working capital and other corporate purposes of Borrower and its
subsidiaries; and
WHEREAS, in connection with the making of the Loans under the Loan
Agreement and as security for all of the obligations of Borrower under the Loan
Agreement, Lender is requiring that Pledgor shall have executed and delivered
this Stock Pledge Agreement and granted the security interest contemplated
hereby;
WHEREAS, Lender, Borrower, Pledgor and The Eastwind Group, Inc. have
entered into a Waiver and Amendment Agreement (the "Waiver and Amendment") dated
as of December ___, 1998, pursuant to which Pledgor is required to execute and
deliver this Stock Pledge Agreement and grant the security interests
contemplated hereby.
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained and to induce Lender to make Loans under the Loan
Agreement and to enter into the Waiver and Amendment, it is agreed as follows:
1. Definitions. Unless otherwise defined herein, terms defined in the
Loan Agreement are used herein as therein defined, and the following shall have
(unless otherwise provided elsewhere in this Stock Pledge Agreement) the
following respective meanings (such meanings being equally applicable to both
the singular and plural form of the terms defined):
"Agreement" shall mean this Stock Pledge Agreement, including all
amendments, modifications and supplements and any exhibits or schedules to any
of the foregoing, and shall refer to the Agreement as the same may be in effect
at the time such reference becomes operative.
"Bankruptcy Code" shall mean title 11, United States Code, as amended
from time to time, and any successor statute thereto.
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"Pledged Collateral" shall have the meaning assigned to such term in
Section 2 hereof.
"Secured Obligations" shall have the meaning assigned to such term in
Section 3 hereof.
2. Pledge. Pledgor hereby pledges to Lender, and grants to Lender, a
first priority security interest in, all of the following (collectively, the
"Pledged Collateral"):
(a) the Pledged Shares of Pledgor and the certificates representing the
Pledged Shares, and all dividends, distributions, cash, instruments and other
property or proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the Pledged Shares of
Pledgor; and
(b) all additional shares of stock of any issuer of the Pledged Shares
from time to time acquired by Pledgor in any manner (which shares shall be
deemed to be part of the Pledged Shares), and the certificates representing such
additional shares, and all dividends, distributions, cash, instruments and other
property or proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such shares.
3. Security for Obligations. This Agreement secures, and the Pledged
Collateral is security for, the prompt payment in full when due, whether at
stated maturity, by acceleration or otherwise, and performance of the
Obligations (as defined in the Loan Agreement), whether for principal, premium,
interest, fees, costs and expenses, and all obligations of Pledgor now or
hereafter existing under this Agreement and under the other Loan Documents
(collectively, the "Secured Obligations").
4. Delivery of Pledged Collateral. All certificates representing or
evidencing the Pledged Shares shall be delivered to and held by or on behalf of
Lender pursuant hereto and shall be accompanied by duly executed instruments of
transfer or assignment in blank, all in form and substance satisfactory to
Lender. Lender shall have the right, at any time in its discretion and without
notice to Pledgor, to transfer to or to register in the name of Lender or any of
its nominees any or all of the Pledged Shares. In addition, Lender shall have
the right at any time to exchange certificates or instruments representing or
evidencing Pledged Shares for certificates or instruments of smaller or larger
denominations.
5. Representations and Warranties. Pledgor represents and warrants to
Lender that:
(a) Pledgor is, and at the time of delivery of the Pledged Shares to
Lender pursuant to Section 4 hereof will be, the sole holder of record and the
sole beneficial owner of the Pledged Collateral pledged by Pledgor free and
clear of any Lien thereon or affecting the title thereto, except for the Lien
created by this Agreement.
(b) All of the Pledged Shares of Pledgor have been duly authorized,
validly issued and are fully paid and non-assessable.
(c) Pledgor has the right and requisite corporate authority to pledge,
assign, transfer,
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deliver, deposit and set over the Pledged Collateral pledged by Pledgor to
Lender as provided herein.
(d) None of the Pledged Shares of Pledgor has been issued or
transferred in violation of the securities registration, securities disclosure
or similar laws of any jurisdiction to which such issuance or transfer may be
subject.
(e) The authorized Stock of Borrower listed on Schedule I hereto
consists of the number of shares of common stock, with the number of shares
issued and outstanding, that are described in Schedule I hereto. As of the date
hereof, there are no existing options, warrants, calls or commitments of any
character whatsoever relating to any Stock of Borrower.
(f) No consent, approval, authorization or other order of any Person
and no consent, authorization, approval, or other action by, and no notice to or
filing with, any Governmental Authority is required either (i) for the pledge by
Pledgor of the Pledged Collateral pursuant to this Agreement for the execution,
delivery or performance of this Agreement by Pledgor or (ii) for the exercise by
the Lender of the voting or other rights provided for in this Agreement or the
remedies in respect of the Pledged Collateral pursuant to this Agreement, except
as may be required in connection with such disposition by laws affecting the
offering and sale of securities generally.
(g) The pledge, assignment and delivery of the Pledged Collateral
pursuant to this Agreement will create a valid first priority Lien on and a
first priority perfected security interest in the Pledged Collateral pledged by
Pledgor, and the proceeds thereof, securing the payment of the Secured
Obligations, subject to no other Lien or security interest.
(h) This Agreement has been duly authorized, executed and delivered by
such Pledgor and constitutes a legal, valid and binding obligation of Pledgor
enforceable in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, or other similar laws affecting the rights of
creditors generally or by the application of general equity principles.
(i) The Pledged Shares constitute one hundred percent (100%) of the
issued and outstanding shares of Stock of Borrower.
The representations and warranties set forth in this Section 5 shall
survive the execution and delivery of this Agreement.
6. Covenants. Pledgor covenants and agrees that until the Termination
Date:
(a) Without the prior written consent of Lender, Pledgor will not sell,
assign, transfer, pledge, or otherwise encumber any of its rights in or to the
Pledged Collateral pledged by Pledgor or any unpaid dividends or other
distributions or payments with respect thereto or xxxxx x Xxxx in any therein
except as otherwise permitted by the Loan Agreement.
(b) Pledgor will, at its expense, promptly execute, acknowledge and
deliver all such instruments and take all such action as Lender from time to
time may request in order to ensure to Lender the benefits of the Liens in and
to the Pledged Collateral intended to be created by this
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Agreement, including the filing of any necessary Uniform Commercial Code
financing statements, which may be filed by Lender with or without the signature
of Pledgor, and will cooperate with Lender, at Pledgor's expense, in obtaining
all necessary approvals and making all necessary filings under federal or state
law in connection with such Liens or any sale or transfer of the Pledged
Collateral.
(c) Pledgor has and will defend the title to the Pledged Collateral and
the Liens of Lender thereon against the claim of any Person and will maintain
and preserve such Liens until the Termination Date.
(d) Pledgor will, upon obtaining any additional shares of Borrower,
which shares are not already Pledged Collateral, promptly (and in any event
within three (3) Business Days) deliver to Lender a Pledge Amendment, duly
executed by Pledgor, in substantially the form of Schedule II hereto (a "Pledge
Amendment"), in respect of the additional Pledged Shares which are to be pledged
pursuant to this Agreement. Pledgor hereby authorizes Lender to attach each
Pledge Amendment to this Agreement and agrees that all Pledged Shares listed on
any Pledge Amendment delivered to Lender shall for all purposes hereunder be
considered Pledged Collateral.
7. Pledgors' Riqhts. As long as no Default or Event of Default shall
have occurred and be continuing and until written notice shall be given to
Pledgor in accordance with Section 8(a) hereof,
(a) Pledgor shall have the right, from time to time, to vote and give
consents with respect to the Pledged Collateral or any part thereof for all
purposes not inconsistent with the provisions of this Agreement, the Loan
Agreement, and any other agreement; provided, however, that no vote shall be
cast, and no consent shall be given or action taken, which would have the effect
of impairing the position or interest of Lender in respect of the Pledged
Collateral or which would authorize or effect (except as and to the extent
expressly permitted by the Loan Agreement) (i) the dissolution or liquidation,
in whole or in part, of Borrower, (ii) the consolidation or merger of Borrower
with any other Person, (iii) the sale, disposition or encumbrance of all or
substantially all of the assets of Borrower, (iv) any change in the authorized
number of shares, the stated capital or the authorized share capital of Borrower
or the issuance of any additional shares of its Stock, or (v) the alteration of
the voting rights with respect to the Stock of Borrower;
(b) (i) Pledgor shall be entitled, from time to time, to collect and
receive for its own use all cash dividends paid in respect of the Pledged Shares
to the extent not in violation of the Loan Agreement other than any and all (A)
dividends paid or payable other than in cash in respect of, and instruments and
other property received, receivable or otherwise distributed in respect of, or
in exchange for, any Pledged Collateral, (B) dividends and other distributions
paid or payable in cash in respect of any Pledged Collateral in connection with
a partial or total liquidation or dissolution, and (c) cash paid, payable or
otherwise distributed in redemption of, or in exchange for, any Pledged
Collateral; provided, however, that until actually paid all rights to such
distributions shall remain subject to the Lien created by this Agreement; and
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(ii) all dividends (other than such cash dividends as are
permitted to be paid to Pledgor in accordance with clause (i) above)
and all other distributions in respect of any of the Pledged Shares of
Pledgor, whenever paid or made, shall be delivered to Lender to hold as
Pledged Collateral and shall, if received by Pledgor, be received in
trust for the benefit of Lender, be segregated from the other property
or funds of Pledgor, and be forthwith delivered to Lender as Pledged
Collateral in the same form as so received (with any necessary
indorsement).
8. Defaults and Remedies. (a) Upon the occurrence of an Event of
Default and during the continuation of such Event of Default, then or at any
time after such declaration (provided that such declaration is not rescinded by
the Lender) and following written notice to Pledgor, Lender (personally or
through an agent) is hereby authorized and empowered be to transfer and register
in its name or in the name of its nominee the whole or any part of the Pledged
Collateral, to exchange certificates or instruments representing or evidencing
Pledged Securities for certificates or instruments of smaller or larger
denominations, to exercise the voting rights with respect thereto, to collect
and receive all cash dividends and other distributions made thereon, to sell in
one or more sales after seven (7) days, notice of the time and place of any
public sale or of the time after which a private sale is to take place (which
notice Pledgor agrees is commercially reasonable), but without any previous
notice or advertisement, the whole or any part of the Pledged Collateral and to
otherwise act with respect to the Pledged Collateral as though Lender was the
outright owner thereof, Pledgor hereby irrevocably constituting and appointing
Lender as the proxy and attorney-in-fact of Pledgor, with full power of
substitution to do so, and which shall remain in effect until the Secured
Obligations are paid in full; provided, however, Lender shall not have any duty
to exercise any such right or to preserve the same and shall not be liable for
any failure to do so or for any delay in doing so. Any sale shall be made at a
public or private sale at Lender's place of business, or at any public building
in the City of New York or elsewhere to be named in the notice of sale, either
for cash or upon credit or for future delivery at such price as Lender may deem
fair, and Lender may be the purchaser of the whole or any part of the Pledged
Collateral so sold and hold the same thereafter in its own right free from any
claim of Pledgor or any right of redemption. Each sale shall be made to the
highest bidder, but Lender reserves the right to reject any and all bids at such
sale which, in its discretion, it shall deem inadequate. Demands of performance,
except as otherwise herein specifically provided for, notices of sale,
advertisements and the presence of property at sale are hereby waived and any
sale hereunder may be conducted by an auctioneer or any officer or agent of
Lender.
(b) If, at the original time or times appointed for the sale of the
whole or any part of the Pledged Collateral, the highest bid, if there be but
one sale, shall be inadequate to discharge in full all the Secured Obligations,
or if the Pledged Collateral be offered for sale in lots, if at any of such
sales, the highest bid for the lot offered for sale would indicate to Lender, in
its discretion, the unlikelihood of the proceeds of the sales of the whole of
the Pledged Collateral being sufficient to discharge all the Secured
Obligations, Lender may, on one or more occasions and in its discretion,
postpone any of said sales by public announcement at the time of sale or the
time of previous postponement of sale, and no other notice of such postponement
or postponements of sale need be given, any other notice being hereby waived;
provided, however, that any sale or sales made after such postponement shall be
after seven (7) days' notice to Pledgor.
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(c) In the event of any sales hereunder Lender shall, after deducting
all costs or expenses of every kind (including reasonable attorneys, fees and
disbursements) for care, safekeeping, collection, sale, delivery or otherwise,
apply the residue of the proceeds of the sales to the payment or reduction,
either in whole or in part, of the Secured Obligations in accordance with the
agreements and instruments governing and evidencing such Obligations, returning
the surplus, if any, to Pledgor.
(d) If, at any time when Lender in its sole discretion determines,
following the occurrence and during the continuance of an Event of Default,
that, in connection with any actual or contemplated exercise of its rights (when
permitted under this Section 8) to sell the whole or any part of the Pledged
Collateral hereunder, it is necessary or advisable to effect a public
registration of all or part of the Pledged Collateral pursuant to the Securities
Act of 1933, as amended (or any similar statute then in effect) (the "Act"),
Pledgor shall, in an expeditious manner, cause Borrower to:
(i) Prepare and file with the Securities and Exchange
Commission (the "Commission") a registration statement with respect to
the Pledged Collateral and use its best efforts to cause such
registration statement to become and remain effective.
(ii) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective and to comply with the provisions of the Act with
respect to the sale or other disposition of the Pledged Collateral
covered by such registration statement whenever Lender shall desire to
sell or otherwise dispose of the Pledged Collateral.
(iii) Furnish to Lender such numbers of copies of a prospectus
and a preliminary prospectus, in conformity with the requirements of
the Act, and such other documents as Lender may request in order to
facilitate the public sale or other disposition of the Pledged
Collateral by Lender.
(iv) Use its best efforts to register or qualify the Pledged
Collateral covered by such registration statement under such other
securities or blue sky laws of such jurisdictions within the United
States as Lender shall request, and do such other reasonable acts and
things as may be required of it to enable Lender to consummate the
public sale or other disposition in such jurisdictions of the Pledged
Collateral by Lender.
(v) Furnish, at the request of Lender, on the date that shares
of the Pledged Collateral are delivered to the underwriters for sale
pursuant to such registration or, if the security is not being sold
through underwriters, on the date that the registration statement with
respect to such shares of the Pledged Collateral becomes effective, (A)
an opinion, dated such date, of the independent counsel representing
such registrant for the purposes of such registration, addressed to the
underwriters, if any, and in the event the Pledged Collateral is not
being sold through underwriters, then to Lender, in customary form and
covering matters of the type customarily covered in such legal
opinions; and (B) a comfort letter, dated such date, from the
independent certified public accountants of such registrant, addressed
to the underwriters, if any, and in the event the Pledged Collateral is
not being sold
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through underwriters, then to Lenders, in a customary form and covering
matters of the type customarily covered by such comfort letters and as
the underwriters or Lender shall reasonably request. The opinion of
counsel referred to above shall additionally cover such other legal
matters with respect to the registration in respect of which such
opinion is being given as Lender may reasonably request. The letter
referred to above from the independent certified public accountants
shall additionally cover such other financial matters (including
information as to the period ending not more than five (5) Business
Days prior to the date of such letter) with respect to the registration
in respect of which such letter is being given as Lender may reasonably
request.
(vi) Otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make available
to its security holders, as soon as reasonably practicable, but not
later than 18 months after the effective date of the registration
statement, an earnings statement covering the period of at least 12
months beginning with the first full month after the effective date of
such registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Act.
(e) All expenses incurred in complying with Section 8(d) hereof,
including, without limitation, all registration and filing fees (including all
expenses incident to filing with the National Association of Securities Dealers,
Inc.), printing expenses, fees and disbursements of counsel for the registrant,
the fees and expenses of counsel for Lender, expenses of the independent
certified public accountants (including any special audits incident to or
required by any such registration) and expenses of complying with the securities
or blue sky laws or any jurisdictions, shall be paid by Pledgor.
(f) If, at any time when Lender shall determine to exercise its right
to sell the whole or any part of the Pledged Collateral hereunder, such Pledged
Collateral or the part thereof to be sold shall not, for any reason whatsoever,
be effectively registered under the Act, Lender may, in its discretion (subject
only to applicable requirements of law), sell such Pledged Collateral or part
thereof by private sale in such manner and under such circumstances as Lender
may deem necessary or advisable, but subject to the other requirements of this
Section 8, and shall not be required to effect such registration or to cause the
same to be effected. Without limiting the generality of the foregoing, in any
such event Lender in its discretion (x) may, in accordance with applicable
securities laws, proceed to make such private sale notwithstanding that a
registration statement for the purpose of registering such Pledged Collateral or
part thereof could be or shall have been filed under said Act (or similar
statute), (y) may approach and negotiate with a single possible purchaser to
effect such sale, and (z) may restrict such sale to a purchaser who will
represent and agree that such purchaser is purchasing for its own account, for
investment and not with a view to the distribution or sale of such Pledged
Collateral or part thereof. In addition to a private sale as provided above in
this Section 8, if any of the Pledged Collateral shall not be freely
distributable to the public without registration under the Act (or similar
statute) at the time of any proposed sale pursuant to this Section 8, then
Lender shall not be required to effect such registration or cause the same to be
effected but, in its discretion (subject only to applicable requirements of
law), may require that any sale hereunder (including a sale at auction) be
conducted subject to restrictions (i) as to the financial sophistication and
ability of any Person permitted to bid or purchase at any such sale, (ii) as to
the
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content of legends to be placed upon any certificates representing the Pledged
Collateral sold in such sale, including restrictions on future transfer thereof,
(iii) as to the representations required to be made by each Person bidding or
purchasing at such sale relating to that Person's access to financial
information about Pledgor and such Person's intentions as to the holding of the
Pledged Collateral so sold for investment, for its own account, and not with a
view to the distribution thereof, and (iv) as to such other matters as Lender
may, in its discretion, deem necessary or appropriate in order that such sale
(notwithstanding any failure so to register) may be effected in compliance with
the Bankruptcy Code and other laws affecting the enforcement of creditors,
rights and the Act, and all applicable state securities laws.
(g) Pledgor acknowledges that notwithstanding the legal availability of
a private sale or a sale subject to the restrictions described above in
paragraph (f), Lender may, in its discretion, elect to register any or all the
Pledged Collateral under the Act (or any applicable state securities law) in
accordance with its rights hereunder. Pledgor, however, recognizes that Lender
may be unable to effect a public sale of any or all the Pledged Collateral and
may be compelled to resort to one or more private sales thereof. Pledgor also
acknowledges that any such private sale may result in prices and other terms
less favorable to the seller than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. Lender shall be
under no obligation to delay a sale of any of the Pledged Collateral for the
period of time necessary to permit the registrant to register such securities
for public sale under the Act, or under applicable state securities laws, even
if Pledgor would agree to do so.
(h) Pledgor agrees that following the occurrence and during the
continuance of an Event of Default it will not at any time plead, claim or take
the benefit of any appraisal, valuation, stay, extension, moratorium or
redemption law now or hereafter in force in order to prevent or delay the
enforcement of this Agreement, or the absolute sale of the whole or any part of
the Pledged Collateral or the possession thereof by any purchaser at any sale
hereunder, and Pledgor waives the benefit of all such laws to the extent it
lawfully may do so. Pledgor agrees that it will not interfere with any right,
power and remedy of Lender provided for in this Agreement or now or hereafter
existing at law or in equity or by statute or otherwise, or the exercise or
beginning of the exercise by Lender of any one or more of such rights, powers or
remedies. No failure or delay on the part of Lender to exercise any such right,
power or remedy and no notice or demand which may be given to or made upon
Pledgor by Lender with respect to any such remedies shall operate as a waiver
thereof, or limit or impair Lender's right to take any action or to exercise any
power or remedy hereunder, without notice or demand, or prejudice its rights as
against Pledgor in any respect.
(i) Pledgor further agrees that a breach of any of the covenants
contained in this Section 8 will cause irreparable injury to Lender, that Lender
has no adequate remedy at law in respect of such breach and, as a consequence,
agrees that each and every covenant contained in this Section 8 shall be
specifically enforceable against Pledgor, and Pledgor hereby waives and agrees
not to assert any defenses against an action for specific performance of such
covenants except for a defense that the Secured Obligations are not then due and
payable in accordance with the agreements and instruments governing and
evidencing such obligations. Pledgor further acknowledges the impossibility of
ascertaining the amount of damages which would be suffered by Lender by reason
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of a breach of any of such covenants and, consequently, agrees that, if Lender
shall xxx for damages for breach, it shall pay, as liquidated damages and not as
a penalty, an amount equal to the lesser of (i) the value of the Pledged
Collateral pledged by Pledgor on the date Lender shall demand compliance with
this Section 8, and (ii) the amount required to pay in full the Secured
Obligations.
9. Application of Proceeds. Any cash held by Lender as Pledged
Collateral and all cash proceeds received by Lender in respect of any sale of,
liquidation of, or other realization upon all or any part of the Pledged
Collateral shall be applied by Lender as follows:
first, to Lender in an amount sufficient to pay in full the expenses of
Lender in connection with such sale, disposition or other realization, including
all expenses, liabilities and advances incurred or made by Lender in connection
therewith, including, without limitation, attorney's fees;
second, to Lender in an amount equal to the then unpaid principal of
and accrued interest and prepayment premiums, if any, on the Secured
Obligations; and
third, to Lender in an amount equal to any other Secured Obligations
which are then unpaid; and finally, after payment in full of all Secured
Obligations, to pay to Pledgor, or its successors or assigns, or to whomsoever
may be lawfully entitled to receive the same, or as a court of competent
jurisdiction may direct, any surplus then remaining from such proceeds.
10. Waiver. No delay on Lender's part in exercising any power of sale,
Lien, option or other right hereunder, and no notice or demand which may be
given to or made upon Pledgor by Lender with respect to any power of sale, Lien,
option or other right hereunder, shall constitute a waiver thereof, or limit or
impair Lender's right to take any action or to exercise any power of sale, Lien,
option, or any other right hereunder, without notice or demand, or prejudice
Lender's rights as against Pledgor in any respect.
11. Assignment. Lender may assign, indorse or transfer any instrument
evidencing all or any part of the Secured Obligations as provided in, and in
accordance with, the Loan Agreement, and the holder of such instrument shall be
entitled to the benefits of this Agreement.
12. Termination. Immediately following the payment of all Secured
Obligations, Lender shall deliver to Pledgor the Pledged Collateral pledged by
Pledgor at the time subject to this Agreement and all instruments of assignment
executed in connection therewith, free and clear of the Liens hereof and, except
as otherwise provided herein, all of Pledgor's obligations hereunder shall at
such time terminate.
13. Lien Absolute. All rights of Lender hereunder, and all obligations
of Pledgor hereunder, shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of the Loan Agreement, the
Notes, any other Loan Document or any other agreement or instrument governing or
evidencing any Secured Obligations;
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(b) any change in the time, manner or place of payment of, or in any
other term of, all or any part of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from the Loan Agreement,
the Notes, any other Loan Document or any other agreement or instrument
governing or evidencing any Secured Obligations;
(c) any exchange, release or non-perfection of any other collateral, or
any release or amendment or waiver of or consent to departure from any guaranty,
for all or any of the Secured Obligations; or
(d) any other circumstance which might otherwise constitute a defense
available to, or a discharge of, Pledgor.
14. Release. Pledgor consents and agrees that Lender may at any time,
or from time to time, in its discretion (a) renew, extend or change the time of
payment, and/or the manner, place or terms of payment of all or any part of the
Secured Obligations and (b) exchange, release and/or surrender all or any of the
Pledged Collateral, or any part thereof, by whomsoever deposited, which is now
or may hereafter be held by Lender in connection with all or any of the Secured
Obligations; all in such manner and upon such terms as Lender may deem proper,
and without notice to or further assent from Pledgor, it being hereby agreed
that Pledgor shall be and remain bound upon this Agreement, irrespective of the
existence, value or condition of any of the Pledged Collateral, and
notwithstanding any such change, exchange, settlement, compromise, surrender,
release, renewal or extension, and notwithstanding also that the Secured
Obligations may, at any time, exceed the aggregate principal amount thereof set
forth in the Loan Agreement, or any other agreement governing any Secured
Obligations. Pledgor hereby waives notice of acceptance of this Agreement, and
also presentment, demand, protest and notice of dishonor of any and all of the
Secured Obligations, and promptness in commencing suit against any party hereto
or liable hereon, and in giving any notice to or of making any claim or demand
hereunder upon Pledgor. No act or omission of any kind on Lender's part shall in
any event affect or impair this Agreement.
15. Indemnification. Pledgor jointly and severally agrees to indemnify
and hold Lender harmless from and against any taxes, liabilities, claims and
damages, including reasonable attorney's fees and disbursements, and other
expenses incurred or arising by reason of the taking or the failure to take
action by Lender, in good faith, in respect of any transaction effected under
this Agreement or in connection with the Lien provided for herein, including,
without limitation, any taxes payable in connection with the delivery or
registration of any of the Pledged Collateral as provided herein. Whether or not
the transactions contemplated by this Agreement shall be consummated, Pledgor
agrees to pay to Lender all out-of-pocket costs and expenses incurred in
connection with this Agreement and all reasonable fees, expenses and
disbursements, including registration costs under the Act (or similar statute)
and the reasonable fees of Lender's agents or representatives, incurred in
connection with the execution and delivery of this Agreement and the performance
by Lender of the provisions of this Agreement and of any transactions effected
in connection with this Agreement. The obligations of Pledgor under this Section
15 shall survive the termination of this Agreement.
16. Reinstatement. This Agreement shall remain in full force and effect
and continue to be effective should any petition be filed by or against Pledgor
for liquidation or reorganization,
10
should Pledgor become insolvent or make an assignment for the benefit of
creditors or should a receiver or trustee be appointed for all or any
significant part of Pledgor's assets, and shall continue to be effective or be
reinstated, as the case may be, if at any time payment and performance of the
Secured Obligations, or any part thereof, is, pursuant to applicable law,
rescinded or reduced in amount, or must otherwise be restored or returned by any
obligee of the Secured Obligations, whether as a "voidable preference",
"fraudulent conveyance", or otherwise, all as though such payment or performance
had not been made. In the event that any payment, or any part thereof, is
rescinded, reduced, restored or returned, the Secured Obligations shall be
reinstated and deemed reduced only by such amount paid and not so rescinded,
reduced, restored or returned.
17. Miscellaneous. (a) Lender may execute any of its duties hereunder
by or through agents or employees and shall be entitled to advice of counsel
concerning all matters pertaining to its duties hereunder.
(b) Pledgor agrees to promptly reimburse Lender for actual
out-of-pocket expenses, including, without limitation, reasonable counsel fees,
incurred by Lender in connection with the administration and enforcement of this
Agreement.
(c) Neither Lender nor any of its officers, directors, employees,
agents or counsel shall be liable for any action lawfully taken or omitted to be
taken by it or them hereunder or in connection herewith, except for its or their
own gross negligence or willful misconduct.
(d) This Agreement shall be binding upon Pledgor and its successors and
assigns, and shall inure to the benefit of, and be enforceable by, Lender and
its successors and assigns, and shall be governed by, and construed and enforced
in accordance with, the internal laws in effect in the State of New York without
giving effect to principles of conflict of laws, and none of the terms or
provisions of this Agreement may be waived, altered, modified or amended except
in writing duly signed for and on behalf of Lender and Pledgor.
18. Severability. If for any reason any provision or provisions hereof
are determined to be invalid and contrary to any existing or future law, such
invalidity shall not impair the operation of or effect those portions of this
Agreement which are valid.
19. Notices. Except as otherwise provided herein, whenever it is
provided herein that any notice, demand, request, consent, approval, declaration
or other communication shall or may be given to or served upon any of the
parties by any other party, or whenever any of the parties desires to give or
serve upon any other a communication with respect to this Agreement, each such
notice, demand, request, consent, approval, declaration or other communication
shall be in writing and either shall be delivered in person with receipt
acknowledged or sent by registered or certified mail, return receipt requested,
postage prepaid, or by telecopy and confirmed by telecopy answerback addressed
as follows:
(a) If to Lender, at
General Electric Capital Corporation
11
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Polychem Corporation Account Manager
(b) If to Pledgor, at its address specified in Schedule I
or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in writing
by the party entitled to receive such notice. Every notice, demand, request,
consent, approval, declaration or other communication hereunder shall be deemed
to have been duly given or served on the date on which personally delivered,
with receipt acknowledged, telecopied and confirmed by telecopy answerback or
three (3) Business Days after the same shall have been deposited in the United
States mail. Failure or delay in delivering copies of any notice, demand,
request, consent, approval, declaration or other communication to the persons
designated above to receive copies shall in no way adversely affect the
effectiveness of such notice, demand, request, consent, approval, declaration or
other communication.
20. Section Titles. The Section titles contained in this Agreement are
and shall be without substantive meaning or content of any kind whatsoever and
are not a part of the agreement between the parties hereto.
21. Counterparts. This Agreement may be executed in any number of
counterparts, which shall, collectively and separately, constitute one
agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Stock Pledge
Agreement to be duly executed as of the date first written above.
CONMAT TECHNOLOGIES,
/s/ Xxxx X. XxXxxxxx
-------------------------------------------
Name: Xxxx X. XxXxxxxx
Title: Chairman and Chief Executive Officer
Accepted and Acknowledged by:
GENERAL ELECTRIC CAPITAL CORPORATION
By: /s/ Xxxxx XxXxxxxx
--------------------------------
Name: Xxxxx Xxxxxxxx
Title: Duly Authorized Signatory
12
SCHEDULE I
Attached to and forming a part of that certain Stock Pledge Agreement
dated as of December 8, 1998 by ConMat Technologies, Inc. to General Electric
Capital Corporation.
Name and Address of Issuer Class of Stock Certificate Number(s) Number of Number of Shares
Pledgor ------ -------------- --------------------- Shares Issued and
------- ------ Outstanding
-----------
ConMat Technologies, Inc. Polychem Common 2 1,000 1,000
Franklin Avenue and Corporation
Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
SCHEDULE II to the Stock Pledge Agreement
PLEDGE AMENDMENT
This Pledge Amendment, dated _____________, 19__ is delivered pursuant to
Section 6(d) of the Stock Pledge Agreement referred to below. The undersigned
hereby agrees that this Pledge Amendment may be attached to that certain Stock
Pledge Agreement, dated as of December ___, 1998, by the undersigned to General
Electric Capital Corporation, and that the Pledged Securities listed on this
Pledge Amendment shall be and become a part of the Pledged Collateral referred
to in said Stock Pledge Agreement and shall secure all Secured Obligations
referred to in said Stock Pledge Agreement.
CONMAT TECHNOLOGIES, INC.
_________________________
By: ___________________
Name:
Title:
Name and Address of Issuer Class of Stock Certificate Number of Number of Shares
Pledgor ------ -------------- Number(s) Shares Issued and
------- --------- ------ Outstanding
-----------
ConMat Technologies, Inc. Polychem
Franklin Avenue and Corporation
Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
