Exhibit 10.33
PLEDGE AND IRREVOCABLE PROXY SECURITY AGREEMENT
(SEC)
THIS PLEDGE AND IRREVOCABLE PROXY SECURITY AGREEMENT ("Agreement") is
made and entered into as of the 7th day of May, 1997, by SOUTHHAMPTON
ENTERPRISES CORP., a British Columbia (Canada) corporation (hereinafter called
"Pledgor"), whose chief executive office is located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, in favor of IMPERIAL BANK, a California banking
corporation, and its successors and assigns (hereinafter called "Secured
Party"), whose address is 9920 South La Cienega Boulevard, Lending Services,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
1. RECITALS
1.1 Secured Party has agreed to make certain financial accommodations
to THE ANTIGUA GROUP, INC., a Nevada corporation (hereinafter when referred to
in this capacity called "Borrower").
1.2 Secured Party's agreement to make financial accommodations to
Borrower is conditioned upon Secured Party's receiving a pledge and security
interest in all stock and securities issued by SOUTHHAMPTON ENTERPRISES, INC. a
Texas corporation (hereinafter when referred to in this capacity called the
"Company"), now owned or hereafter acquired by Pledgor.
1.3 Pledgor is the owner of all of the shares of the capital stock of
the Company, and Pledgor desires to pledge to Secured Party such shares in
connection with Secured Party's financial accommodations to Borrower.
2. PLEDGE OF STOCK
2.1 Pledgor hereby assigns, transfers, pledges and delivers to Secured
Party and grants Secured Party a security interest in all issued and outstanding
stock in the Company now owned or hereafter acquired by Pledgor, including
without limitation the stock described on Schedule 2.1 attached hereto and by
this reference made a part hereof, together with all earnings thereon, all
additions thereto, all proceeds thereof from sale or otherwise, all
substitutions therefor, and all securities issued with respect thereto as a
result of any stock dividend, stock split, warrants or other rights,
reclassification, readjustment or other change in the capital structure of the
Company, and the securities of any corporation or other properties received upon
the conversion or exchange thereof pursuant to any merger, consolidation,
reorganization, sale of assets or other agreement or received upon any
liquidation of the Company or such other corporation (all hereinafter called the
"Pledged Securities").
2.2 Upon the execution of this Agreement, Pledgor shall deliver to
Secured Party certificates for the Pledged Securities, together with appropriate
stock transfer powers therefor duly executed by Pledgor in blank. Immediately
upon receipt, Pledgor shall deliver to Secured Party all certificates and other
evidences of the Pledged Securities that come into the possession, custody or
control of Pledgor, together with appropriate stock transfer powers therefor
duly executed by Pledgor in blank, and any other property constituting part of
the Pledged Securities, free and clear of any prior lien, claim, charge or
encumbrance.
2.3 Secured Party may receive, hold and/or dispose of the Pledged
Securities subject and pursuant to all the terms, conditions and provisions
hereof and of the Credit Agreement (defined below) until the Obligation (defined
below) has been discharged in full. Secured Party is hereby authorized and
empowered to take any and all action with respect to such property as authorized
under this Agreement. In its discretion and without notice to Pledgor, Secured
Party may take any one or more of the following actions if an Event of Default
has occurred and is continuing, without liability except to account for property
actually received by it:
(a) transfer to or register in its name or the name of its
nominee any of the Pledged Securities, with or without indication of
the security interest herein created and/or the proxy granted to it in
Section 5.1; and whether or not the Pledged Securities are so
transferred or registered, receive the income, dividends and other
distributions thereon except for cash dividends permitted to be paid
under the terms of the Credit Agreement and hold them or apply them to
the Obligation in any order of priority;
(b) exchange any of the Pledged Securities for other property
upon a reorganization, recapitalization or other readjustment and, in
connection therewith, deposit any of the Pledged Securities with any
committee or depositary upon such terms as the Secured Party may
determine; and
(c) in its name, or in the name of Pledgor, demand, ▇▇▇ for,
collect or receive any money or property (except for cash dividends
permitted to be paid under the terms of the Credit Agreement) at any
time payable or receivable on account of, or in exchange for, any of
the Pledged Securities and, in connection therewith, endorse notes,
checks, drafts, money orders, documents of title or other evidences of
payment, shipment or storage in the name of Pledgor.
Secured Party shall be under no duty to exercise, or to withhold the exercise
of, any of the rights, powers, privileges and options expressly or implicitly
granted to Secured Party in this Agreement, and shall not be responsible for any
failure to do so or delay in so doing.
3. OBLIGATION SECURED
This Agreement shall secure, in such order of priority as Secured Party
may elect:
(a) Payment of the sum of $2,500,000.00 with interest thereon,
extension and other fees, late charges, prepayment premiums and
attorneys' fees, according to the terms of that Promissory Note dated
of even date herewith, made by Borrower, payable to the order of
Secured Party, and all extensions, modifications, renewals or
replacements thereof (hereinafter called the "Note");
(b) Payment, performance and observance by Pledgor of each
covenant, condition, provision and agreement contained herein and of
all monies expended or advanced by Secured Party pursuant to the terms
hereof, or to preserve any right of Secured Party hereunder, or to
protect or preserve the Pledged Securities or any part thereof;
(c) Payment, performance and observance by Pledgor, Company
and Borrower of each covenant, condition, provision and agreement
contained in that Credit Agreement dated of even date herewith, by and
between Pledgor, Company, Borrower and Secured Party (hereinafter
called the "Credit Agreement") and in any other document or instrument
related to the indebtedness hereby secured and of all monies expended
or advanced by Secured Party pursuant to the terms thereof or to
preserve any right of Secured Party thereunder; and
(d) Payment and performance of any and all other indebtedness,
obligations and liabilities of Pledgor, Company and/or Borrower to
Secured Party of every kind and character, direct or indirect, absolute
or contingent, due or to become due, now existing or hereafter
incurred, whether such indebtedness is from time to time reduced and
thereafter increased or entirely extinguished and thereafter
reincurred.
All of the indebtedness and obligations secured by this Agreement are
hereinafter collectively called the "Obligation."
4. REPRESENTATIONS AND WARRANTIES OF PLEDGOR
Pledgor hereby represents and warrants that:
4.1 If Pledgor is a corporation, partnership or trust, it (i) is duly
organized, validly existing and in good standing under the laws of the state in
which it is organized; (ii) is qualified to do business and is in good standing
under the laws of each state in which it is doing business; (iii) has full power
and authority to own its properties and assets and to carry on its business as
now conducted; and (iv) is fully authorized and permitted to execute and deliver
this Agreement. The execution, delivery and performance by Pledgor of this
Agreement and all other documents
and instruments relating to the Obligation will not result in any breach of the
terms and conditions of, nor constitute a default under, any agreement or
instrument under which Pledgor is a party or is obligated. Pledgor is not in
default in the performance or observance of any covenants, conditions or
provisions of any such agreement or instrument.
4.2 The address of Pledgor set forth at the beginning of this Agreement
is the chief executive office of Pledgor (or Pledgor's residence if Pledgor is
an individual without an office).
4.3 The Pledged Securities are and shall be duly and validly issued and
pledged in accordance with applicable law, and this Agreement shall not
contravene any law, agreement or commitment binding Pledgor or the Company, and
Pledgor shall defend the right, title, lien and security interest of Secured
Party in and to the Pledged Securities against the claims and demands of all
persons and other entities whatsoever. The stock identified in Schedule 2.1 is
all of the issued and outstanding capital stock of the Company.
4.4 Pledgor has the right, power and authority to convey good and
marketable title to the Pledged Securities; and the Pledged Securities and the
proceeds thereof are and shall be free and clear of all claims, mortgages,
pledges, liens, encumbrances and security interest of every nature whatsoever
other than as imposed hereby or as set forth, if at all, on Schedule 4.4
attached hereto.
5. IRREVOCABLE PROXY
5.1 Pledgor irrevocably constitutes and appoints Secured Party, whether
or not the Pledged Securities have been transferred into the name of Secured
Party or its nominee, as Pledgor's proxy with full power, in the same manner, to
the same extent and with the same effect as if Pledgor were to do the same, in
the sole discretion of Secured Party:
(a) To call a meeting of the stockholders of the Company and
to vote the Pledged Securities, to seek the consent of such
stockholders, to remove the directors of the Company, or any of them,
and to elect new directors of the Company, who thereafter shall manage
the affairs of the Company, operate its properties and carry on its
business, and otherwise take any action with respect to the business,
properties and affairs of the Company that such new directors shall
deem necessary or appropriate, including, but not limited to, the
maintenance, repair, renewal or alteration of any or all of the
properties of the Company, the leasing, subleasing, sale or other
disposition of any or all of such properties, the borrowing of money on
the credit of the Company (whether from Secured Party or others) that
in the judgment of such new directors shall be necessary to preserve
any of such properties or to discharge the obligations of the Company,
and the employment of any or all agents, attorneys, counsel, or
other employees as deemed by such new directors to be necessary for the
proper operation or conduct of the business, properties and affairs of
the Company;
(b) To consent to any and all actions by or with respect to
the Company for which consent of the stockholders of the Company is or
may be necessary or appropriate; and
(c) Without limitation, to do all things that Pledgor can do
or could do as stockholder of the Company, giving Secured Party full
power of substitution and revocation;
provided, however, that (i) the foregoing irrevocable proxy shall not be
exercisable by Secured Party, and Pledgor alone shall have the foregoing powers,
so long as there is no Event of Default hereunder, and (ii) this irrevocable
proxy shall terminate at such time as this Agreement is no longer in full force
and effect. The foregoing proxy is coupled with an interest sufficient in law to
support an irrevocable power and shall be irrevocable and shall survive the
death or incapacity of Pledgor. Pledgor hereby revokes any proxy or proxies
heretofore given to any person or persons and agrees not to give any other
proxies in derogation hereof until such time as this Agreement is no longer in
full force and effect.
6. COVENANTS OF PLEDGOR
6.1 Pledgor shall not sell, transfer, assign or otherwise dispose of
any of the Pledged Securities or any interest therein without obtaining the
prior written consent of Secured Party and shall keep the Pledged Securities
free of all security interests or other encumbrances except the lien and
security interests granted herein and the security interests set forth on
Schedule 4.4 attached hereto.
6.2 Pledgor shall pay when due all taxes, assessments, expenses and
other charges which may be levied or assessed against the Pledged Securities.
6.3 Pledgor shall give Secured Party immediate written notice of any
change in Pledgor's name as set forth above and of any change in the location of
Pledgor's residence.
6.4 Pledgor, at its cost and expense, shall protect and defend the
Pledged Securities, this Agreement and all of the rights of Secured Party
hereunder against all claims and demands of other parties. Pledgor shall pay all
claims and charges that in the opinion of Secured Party might prejudice, imperil
or otherwise affect the Pledged Securities. Pledgor shall promptly notify
Secured Party of any levy, distraint or other seizure, by legal process or
otherwise, of all or any part of the Pledged Securities and of any threatened or
filed claims or proceedings that might in any way affect or impair the terms of
this Agreement.
6.5 If Pledgor shall fail to pay any taxes, assessments,
expenses or charges, to keep all of the Pledged Securities free from other
security interests, encumbrances or claims excepting the security interests set
forth on Schedule 4.4 attached hereto, or to perform otherwise as required
herein, Secured Party may advance the monies necessary to pay the same or to so
perform.
6.6 All rights, powers and remedies granted Secured Party herein, or
otherwise available to Secured Party, are for the sole benefit and protection of
Secured Party, and Secured Party may exercise any such right, power or remedy at
its option and in its sole and absolute discretion without any obligation to do
so. In addition, if, under the terms hereof, Secured Party is given two or more
alternative courses of action, Secured Party may elect any alternative or
combination of alternatives at its option and in its sole and absolute
discretion. All monies advanced by Secured Party under the terms hereof, all
amounts paid, suffered or incurred by Secured Party under the terms hereof and
all amounts paid, suffered or incurred by Secured Party in exercising any
authority granted herein, including reasonable attorneys' fees, shall be added
to the Obligation, shall be secured hereby, shall bear interest at the highest
rate payable on any of the Obligation until paid, and shall be due and payable
by Pledgor to Secured Party immediately without demand.
6.7 Secured Party shall use such reasonable care in handling,
preserving and protecting the Pledged Securities in its possession as it uses in
handling similar property for its own account. Secured Party, however, shall
have no liability for the loss, destruction or disappearance of any Pledged
Securities unless there is affirmative proof of a lack of due care; and lack of
due care shall not be implied solely by virtue of any loss, destruction or
disappearance. Secured Party shall not be required to take any steps necessary
to preserve any rights in the Pledged Securities against prior parties or to
protect, perfect, preserve or maintain any security interest given to secure the
Pledged Securities.
6.8 Immediately upon demand by Secured Party, Pledgor shall execute and
deliver to Secured Party such other and additional applications, acceptances,
stock powers, authorizations, irrevocable proxies, dividend and other orders,
chattel paper, instruments or other evidences of payment and such other
documents as Secured Party may reasonably request to secure to Secured Party the
rights, powers and authorities intended to be conferred upon Secured Party by
this Agreement. All assignments and endorsements by Pledgor shall be in such
form and substance as may be satisfactory to Secured Party.
7. EVENTS OF DEFAULT; REMEDIES
7.1 As used herein the term "Event of Default" shall have the meaning
given to it in the Credit Agreement.
7.2 Upon the occurrence of any Event of Default and at any time while
such Event of Default is continuing, Secured Party shall
have the following rights and remedies and may do one or more of the following:
(a) Declare all or any part of the Obligation to be
immediately due and payable, and the same, with all costs and charges,
shall be collectible thereupon by action at law;
(b) Transfer the Pledged Securities or any part thereof into
its own name or that of its nominee so that Secured Party or its
nominee may appear of record as the sole owner thereof;
(c) Vote any or all of the Pledged Securities and give all
consents, waivers and ratifications in respect thereof and otherwise
acting with respect thereto as though it were the absolute owner
thereof;
(d) Exercise any and all rights of conversion, exchange,
subscription, or any other rights, privileges or options pertaining to
any of the Pledged Securities including, but not limited to, the right
to exchange, at its discretion, any or all of the Pledged Securities
upon the merger, consolidation, reorganization, recapitalization or
other readjustment of the Company or upon the exercise by Pledgor or
Secured Party of any right, privilege or option pertaining to any of
the shares of the Pledged Securities, and in connection therewith to
deposit and deliver such shares of Pledged Securities with any
committee, depository, transfer agent, registrar or any other agency
upon such terms as Secured Party may determine without liability except
to account for the property actually received by it;
(e) Receive and retain any dividend or other distribution on
account of the Pledged Securities;
(f) Sell any or all of the Pledged Securities in accordance
with the provisions hereof;
(g) Insure any of the Pledged Securities;
(h) In its name, or in the name of Pledgor, make any
compromise or settlement deemed advisable with respect to any of the
Pledged Securities; and
(i) Exercise any or all of its other rights, power and
privileges hereunder or available at law or in equity;
but Secured Party shall have no duty to exercise any of the aforesaid rights,
privileges or options and shall not be responsible for any failure to do so or
delay in so doing. Pledgor waives all rights to be advised or to receive any
notices, statements or communications received by Secured Party or its nominee
as the record owner of all or any of the Pledged Securities. Any cash received
and retained by Secured Party as additional collateral hereunder may be applied
to payment in the
manner provided in Subparagraph 7.3(c) below.
7.3 In connection with Secured Party's right to sell any or all of the
Pledged Securities, upon the occurrence of any Event of Default and at any time
while such Event of Default is continuing:
(a) (i) Secured Party shall have the right at any time and from
time to time to sell, resell, assign and deliver, in its discretion,
all or any part of the Pledged Securities in one or more units, at the
same or different times, and all right, title and interest, claim and
demand therein, and right of redemption thereof, at private sale, or at
public sale to the highest bidder for cash, upon credit or for future
delivery, Pledgor hereby waiving and releasing to the fullest extent
permitted by law any and all equity or right of redemption. If any of
the Pledged Securities are sold by Secured Party upon credit or for
future delivery, Secured Party shall not be liable for the failure of
the purchaser to purchase or pay for same, and, in the event of any
such failure, Secured Party may resell such Pledged Securities. In no
event shall Pledgor be credited with any part of the proceeds of the
sale of any Pledged Securities until cash payment thereof has actually
been received by Secured Party.
(ii) No demand, advertisement or notice, all of which are
hereby expressly waived, shall be required in connection with any sale
or other disposition of all or any part of the Pledged Securities that
threatens to decline speedily in value or that is of a type customarily
sold on a recognized market; otherwise Secured Party shall give Pledgor
at least five (5) days' prior notice of the time and place of any
public sale or of the time after which any private sale or other
dispositions are to be made, which Pledgor agrees is reasonable, all
other demands, advertisements and notices being hereby waived. Upon any
sale, whether under this Agreement or by virtue of judicial
proceedings, Secured Party may bid for and purchase any or all of the
Pledged Securities and, upon compliance with the terms of the sale, may
hold, retain, possess and dispose of such items in its own absolute
right without further accountability, and as purchaser at such sale, in
paying the purchase price, may turn in any note or notes held by
Secured Party in lieu of cash up to the amount that would, upon
distribution of the net proceeds of such sale in accordance with
Subparagraph 7.3(c) hereof, be payable to Secured Party. In case the
amount so payable thereon shall be less than the amount due thereon,
the note or notes turned in (in lieu of cash) shall be returned to the
holder thereof after being properly stamped to show the partial payment
effected by such purchase.
(b) Pledgor recognizes that Secured Party may be unable to
effect a sale to the public of all or a part of the Pledged Securities
by reason of prohibitions contained in applicable securities laws, but
may be compelled to resort to one or more
sales to a restricted group of purchasers who will be obliged to agree,
among other things, to acquire such Pledged Securities for their own
account, for investment and not with a view to the distribution or
resale thereof. Pledgor agrees that sales so made may be at prices and
other terms less favorable to the seller than if such Pledged
Securities were sold to the public, and that Secured Party has no
obligation to delay sale of any such Pledged Securities for the period
of time necessary to permit the issuer of such Pledged Securities to
register the same for sale to the public under applicable securities
laws. Pledgor agrees that negotiated sales made under the foregoing
circumstances shall be deemed to have been made in a commercially
reasonable manner.
(c) In all sales of Pledged Securities, public or private,
Secured Party shall apply the proceeds of sale as follows:
(i) First, to the payment of all costs and expenses
incurred hereunder or for the sale, transfer, or delivery,
including broker's and attorneys' fees;
(ii) Next to the payment of the Obligation; and
(iii) The balance, if any, to Pledgor or to the
person or persons entitled thereto upon proper demand.
7.4 Secured Party shall have the right, for and in the name, place and
stead of Pledgor, to execute endorsements, assignments or other instruments of
conveyance or transfer with respect to all or any of the Pledged Securities and
any instruments, documents and statements that Pledgor is obligated to furnish
or execute hereunder. Pledgor shall execute and deliver such additional
documents as may be necessary to enable Secured Party to implement such right.
7.5 Pledgor shall pay all costs and expenses, including without
limitation court costs and reasonable attorneys' fees, incurred by Secured Party
in enforcing payment and performance of the Obligation or in exercising the
rights and remedies of Secured Party hereunder. All such costs and expenses
shall be secured by this Agreement and by all other lien and security documents
securing the Obligation. In the event of any court proceedings, court costs and
attorneys' fees shall be set by the court and not by jury and shall be included
in any judgment obtained by Secured Party.
7.6 In addition to any remedies provided herein for an Event of
Default, Secured Party shall have all the rights and remedies afforded a secured
party under the Uniform Commercial Code and all other legal and equitable
remedies allowed under applicable law. No failure on the part of Secured Party
to exercise any of its rights hereunder arising upon any Event of Default shall
be construed to prejudice its rights upon the occurrence of any other
or subsequent Event of Default. No delay on the part of Secured Party in
exercising any such rights shall be construed to preclude it from the exercise
thereof at any time while that Event of Default is continuing. Secured Party may
enforce any one or more rights or remedies hereunder successively or
concurrently. By accepting payment or performance of any of the Obligation after
its due date, Secured Party shall not thereby waive the agreement contained
herein that time is of the essence, nor shall Secured Party waive either its
right to require prompt payment or performance when due of the remainder of the
Obligation or its right to consider the failure to so pay or perform an Event of
Default.
8. MISCELLANEOUS PROVISIONS
8.1 The acceptance of this Agreement by Secured Party shall not be
considered a waiver of or in any way to affect or impair any other security that
Secured Party may have, acquire simultaneously herewith, or hereafter acquire
for the payment or performance of the Obligation, nor shall the taking by
Secured Party at any time of any such additional security be construed as a
waiver of or in any way to affect or impair the right and interest granted
herein; Secured Party may resort, for the payment or performance of the
Obligation, to its several securities therefor in such order and manner as it
may determine.
8.2 Without notice or demand, without the necessity for any additional
endorsements, without affecting the obligations of Pledgor hereunder or the
personal liability of any person for payment or performance of the Obligation,
and without affecting the rights and interests granted herein, Secured Party,
from time to time, may: (i) extend the time for payment of all or any part of
the Obligation, accept a renewal note therefor, reduce the payments thereon,
release any person liable for all or any part thereof, or otherwise change the
terms of all or any part of the Obligation; (ii) take and hold other security
for the payment or performance of the Obligation and enforce, exchange,
substitute, subordinate, waive or release any such security; (iii) join in any
extension or subordination agreement; or (iv) release any part of the Pledged
Securities from this Agreement.
8.3 Pledgor waives and agrees not to assert: (i) any right to require
Secured Party to proceed against any guarantor, to proceed against or exhaust
any other security for the Obligation, to pursue any other remedy available to
Secured Party, or to pursue any remedy in any particular order or manner; (ii)
the benefits of any statute of limitations affecting the enforcement hereof;
(iii) the benefits of any legal or equitable doctrine or principle of
marshalling; (iv) demand, diligence, presentment for payment, protest and
demand, and notice of extension, dishonor, protest, demand and nonpayment,
relating to the Obligation; and (v) any benefit of, and any right to participate
in, any other security now or hereafter held by Secured Party.
8.4 The terms herein shall have the meanings in and be construed under
the Uniform Commercial Code. This Agreement shall be governed by and construed
according to the laws of the State of California, except to the extent Secured
Party has greater rights or remedies under Federal law, whether as a national
bank or otherwise, in which case such choice of California law shall not be
deemed to deprive Lender of any such rights and remedies as may be available
under Federal law. Each provision of this Agreement shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be void or invalid, the same shall not affect the
remainder hereof which shall be effective as though the void or invalid
provision had not been contained herein.
8.5 No modification, rescission, waiver, release or amendment of any
provision of this Agreement shall be made except by a written agreement executed
by Pledgor and a duly authorized officer of Secured Party.
8.6 This is a continuing agreement, which shall remain in full force
and effect until actual receipt by Secured Party of written notice of its
revocation as to future transactions and shall remain in full force and effect
thereafter until all of the Obligation incurred before the receipt of such
notice, and all of the Obligation incurred thereafter under commitments extended
by Secured Party before the receipt of such notice, shall have been paid and
performed in full.
8.7 No setoff or claim that Pledgor now has or may in the future have
against Secured Party shall relieve Pledgor from paying or performing its
obligations hereunder.
8.8 Time is of the essence hereof. If more than one Pledgor is named
herein, the word Pledgor shall mean all and any one or more of them, severally
and collectively. All liability hereunder shall be joint and several. This
Agreement shall be binding upon, and shall inure to the benefit of, the parties
hereto and their heirs, personal representatives, successors and assigns. The
term "Secured Party" shall include not only the original Secured Party hereunder
but also any future owner and holder, including pledgees, of the note or notes
evidencing the Obligation. The provisions hereof shall apply to the parties
according to the context thereof and without regard to the number or gender of
words or expressions used.
8.9 Except for telephonic notices (if any) permitted herein, any
notices or other communications required or permitted to be given by this
Agreement to Pledgor or Secured Party must be (i) given in writing and
personally delivered or mailed by prepaid certified or registered mail, or (ii)
made by telefacsimile delivered or transmitted (but confirmed on the date the
telefacsimile is transmitted by one of the other methods of giving of notice
provided in this Section), to the person to whom such notice or communication is
directed, to the address of such person
as follows:
Pledgor: Southhampton Enterprises Corp.
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Attn: L. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Secured Party: Imperial Bank
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Attention: General Counsel
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy (which shall not constitute notice) to:
Imperial Bank
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Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Any notice to be personally delivered may be delivered to the principal offices
(determined as of the date of such delivery) of the person to whom such notice
is directed. Any such notice or other communication shall be deemed to have been
given (whether actually received or not) on the day it is personally delivered
as aforesaid; or, if mailed, on the third day after it is mailed as aforesaid;
or, if transmitted by telefacsimile, on the day that such notice is transmitted
and confirmed as aforesaid; provided that notice to Secured Party shall be
deemed given only if given to Secured Party at both notice addresses. Pledgor or
Secured Party may change its address for purposes of this Agreement by giving
notice of such change to the other parties pursuant to this Section.
8.10 A carbon, photographic or other reproduced copy of this Agreement
and/or any financing statement relating hereto shall be sufficient for filing
and/or recording as a financing statement.
9. NON-PLEDGOR BORROWER PROVISIONS
9.1 All advances of principal under the Note shall be made to Borrower
subject to and in accordance with the terms thereof. It is not necessary for
Secured Party to inquire into the powers of Borrower or the officers, directors,
partners or agents acting or purporting to act on its behalf. Pledgor is and
shall continue to be fully informed as to all aspects of the business affairs of
Borrower that it deems relevant to the risks it is assuming and hereby waives
and fully discharges Secured Party from any and all obligations to communicate
to Pledgor any facts of any nature whatsoever regarding Borrower and Borrower's
business affairs.
9.2 Pledgor authorizes Secured Party, without notice or demand, without
affecting the obligations of Pledgor hereunder or the personal liability of any
person for payment or performance of the Obligation and without affecting the
lien or the priority of the lien created hereby, from time to time, at the
request of any person primarily obligated therefor, to renew, compromise,
extend, accelerate or otherwise change the time for payment or performance of,
or otherwise change the terms of, all or any part of the Obligation, including
increase or decrease any rate of interest thereon. Pledgor waives and agrees not
to assert: (i) any right to require Secured Party to proceed against Borrower;
(ii) the benefits of any statutory provision limiting the liability of a surety;
and (iii) any defense arising by reason of any disability or other defense of
Borrower or by reason of the cessation from any cause whatsoever of the
liability of Borrower. Pledgor shall have no right of subrogation and hereby
waives any right to enforce any remedy which Secured Party now has, or may
hereafter have, against Borrower.
9.3 Nothing contained herein shall affect or limit the right of Secured
Party to proceed against any person or entity, including Pledgor or any partner
in Pledgor, with respect to the enforcement of any guarantee or other similar
rights.
9.4 Pledgor waives all right and defenses that Pledgor may have because
a principal's liability for the Obligation is at any time secured by real
property. This means, among other things: (1) Secured Party may pursue its
remedies against Pledgor without first foreclosing on any real or personal
property collateral pledged by Borrower; and (2) if Secured Party forecloses on
any real property collateral pledged by Borrower: (A) the amount of the debt may
be reduced only by the price for which that collateral is sold at the
foreclosure sale, even if the collateral is worth more than the sale price; and
(B) Secured Party may pursue its remedies against Pledgor even if Secured Party,
by foreclosing on the real property collateral, has destroyed any right Pledgor
may have to collect from Borrower. This is an unconditional and irrevocable
waiver of any rights and defenses Pledgor may have because a principal's
liability for the Obligation is at any time secured by real property. These
rights and defenses include, but are not limited to, any rights or defenses
based upon Section 580a, 580b, 580d, or 726 of the California Code of Civil
Procedure. Furthermore, Pledgor waives all rights and defenses arising out of an
election of remedies by Secured Party, even though that election of remedies,
such as a nonjudicial foreclosure with respect to security for a secured
obligation, has destroyed Pledgor's rights of subrogation and reimbursement
against the principal by the operation of Section 580d of the California Code of
Civil Procedure or otherwise.
IN WITNESS WHEREOF, these presents are executed as of the date
indicated above.
SOUTHHAMPTON ENTERPRISES CORP., a
British Columbia (Canada)
corporation
Witness By: /s/ L. ▇▇▇▇▇▇ ▇▇▇▇▇▇
(Other than Notary Public) Type/Print Name: L. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
Typed/Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
PLEDGOR
STATE OF ARIZONA )
) ss.
County of Maricopa )
The foregoing instrument was acknowledged before me this 7th day of
May, 1997, by L. ▇▇▇▇▇▇ ▇▇▇▇▇▇, the President of SOUTHHAMPTON ENTERPRISES CORP.,
a British Columbia (Canada) corporation, on behalf of such corporation.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ ▇▇▇▇▇▇▇ ▇. Durkaz
Notary Public
My commission expires:
My Commission Expires July 31, 1997
SCHEDULE 2.1
All issued and outstanding shares of stock in Southhampton Enterprises
Inc., a Texas corporation, now or hereafter owned by Pledgor, which as of the
date hereof consists of 1,000 shares of common stock as evidenced by Certificate
Nos. 2, 3 and 4.
SCHEDULE 4.4
PERMITTED SECURITY INTEREST
1. A junior security interest in favor of The Cruttenden ▇▇▇▇ Bridge
Fund, LLC, and securing (a) repayment of a loan to Borrower in the principal
amount of $1,020,000 and (b) payment and performance of obligations incidental
to such loan.
2. A junior security interest in favor of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, as agent
for the entities described in Schedule 4.4A, and securing (a) repayment of
indebtedness in the aggregate principal amount of approximately $6,378,000 and
(b) payment and performance of obligations incidental to such indebtedness.
3. A security interest granted in connection with a refinancing of the
indebtedness described in items 1 and 2 above, but only if such security
interest is a Permitted Lien (as defined in the Credit Agreement).
SCHEDULE 4.4A
SELLER
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. and ▇▇▇▇ ▇. ▇▇▇▇▇▇, Trustees under the ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
and ▇▇▇▇ ▇▇▇▇▇▇ Revocable Trust of 1988, dated 10/4/88.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ as Custodian Under the Uniform Gifts to Minors Act fbo ▇▇▇ ▇.
▇▇▇▇▇▇.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ as Custodian Under the Uniform Gifts to Minors Act fbo ▇▇▇▇▇ ▇.
▇▇▇▇▇▇.
E. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇., Trustee, E. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇., Revocable Intervivos Trust
dated December 31, 1982.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Trustee under the 1989 Trust Agreement established separate
irrevocable Gift Trusts f/b/o the children of ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇ dated March
7, 1989.