10.4
PLEDGE AGREEMENT
AGREEMENT made as of April 30, 2003, among HUMANA TRANS SERVICES
HOLDING CORP., a Delaware corporation whose principal address is ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or any subsidiary or affiliate or
successor or assignee of HUMANA TRANS SERVICES HOLDING CORP.("Corporate
Pledgor"), ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, an individual with a principal address at ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ 16801("Pledgor" and collectively
with the Corporate Pledgor, the "Pledgors") and NATIONAL MANAGEMENT CONSULTING
INC., a Delaware corporation whose office address is 545 Madison Avenue, 6th
Floor, New York, New York 10022 (the "Pledgee").
WHEREAS, Humana Trans Services Group, Ltd., a New York corporation (the
"Company") is presently engaged in the business of providing transportation
related services to a range of companies and the Company is a wholly-owned
subsidiary of Pledgee; and
WHEREAS, the Company entered into a Employment Agreement effective as
of March 1, 2003 with the Pledgor (the "Employment Agreement") and Pledgee as a
party to the Employment Agreement guaranteed the financial performance of the
Company with regard to the obligations set forth in Sections 6 (a) and (c)
thereof; and
WHEREAS, the Pledgor, Pledgee and the Company have determined that it
is in the best interests of all parties to the Employment Agreement to terminate
the Employment Agreement pursuant to a settlement agreement (the "Settlement
Agreement"); and
WHEREAS, in conjunction with the termination of the Employment
Agreement, the Company, the Corporate Pledgor and the Pledgee have also agreed
to enter into a stock purchase agreement (the "Stock Purchase Agreement")
pursuant to which, among other things, the Corporate Pledgor will purchase all
the shares of the Company (the "Shares") and the Corporate Pledgor and Pledgor
will execute a secured promissory note in connection therewith (the "Note")
secured by certain shares of common stock or preferred stock owned by the
Corporate Pledgor or the Pledge, including the Shares, to be pledged to the
Pledgee (collectively, the "Pledged Stock") pursuant to the terms set forth
herein and pursuant to an escrow agreement between the Corporate Pledgor, the
Pledgor, the Pledgee and the law firm of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP as escrow agent
(the "Escrow Agent")(the "Escrow Agreement"); and
WHEREAS, in addition, the Pledgor will in conjunction with entering
into the Settlement Agreement also enter into a consulting agreement with the
Pledgee to provide on a non-exclusive basis introductions to the Pledgee with
regard to a variety of potential corporate transactions with compensation to be
set forth in such consulting agreement (the "Consulting Agreement") (the
Settlement Agreement, Stock Purchase Agreement, Note, Escrow Agreement and
Consulting Agreement shall be referred to collectively as the "Ancillary
Agreements").
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt of which the Corporate Pledgor and the
Pledgor hereby acknowledge, the Corporate Pledgor and the Pledgor hereby pledge,
mortgage, assign, grant interests in, deliver, deposit, set over and confirm all
of the Pledged Stock unto the Pledgee and its successors and assigns, as
security for the due performance and prompt payment of all of the obligations of
the Corporate Pledgor under the Note and of the Pledgor under the Guaranty. The
Corporate Pledgor and the Pledgor hereby covenant and agree that the Pledged
Stock is to be held by the Escrow Agent pursuant to the Escrow Agreement and
disposed of in accordance with the terms hereafter set forth:
1
1. PLEDGE. In consideration of the Pledgee selling the Shares to the
Corporate Pledgor and as security for the repayment of the Note, the Corporate
Pledgor and the Pledgor hereby grant a security interest to the Pledgee in
instruments of the following description, duly endorsed in blank or accompanied
by duly endorsed stock powers, separate form (collectively, the "Stock Powers"),
and herewith delivered to the Escrow Agent:
Number of
Shares*
Pledging ISSUER OR % INTEREST CERTIFICATE NO.
PARTY
Corporate Pledgor Humana Trans Services 1000shares 101
Group, Ltd.
Pledgor Dominix, Inc. []
Pledgor ▇▇▇▇▇▇.▇▇▇, Inc. 34,750 shares A025
Series A preferred
stock**
Pledgor National Management
Consulting Inc. 500,000 shares
*Unless otherwise noted, the shares represent common stock of the Issuer.
**11,500 shares of the series A preferred stock of ▇▇▇▇▇▇.▇▇▇, Inc. is already
held in escrow with the Escrow Agent.
The Pledgor appoints the Pledgee his attorney to arrange for the
transfer of the Pledged Stock on the books of the companies to the name of the
Pledgee. The Pledgee at its option shall hold the Pledged Stock on the books of
the companies in the name of the Pledgee. The Pledgee shall hold the Pledged
Stock as security for payment of the Note and shall not encumber or dispose of
the Pledged Stock except in accordance with the provisions of paragraph 8 of
this Agreement. Corporate Pledgor and the Pledgor agree to execute and deliver
to Pledgee any UCC-1 financing statements and any other documents necessary or
appropriate to prtec the security interested granted to the Pledgee hereunder
and shall cause the same to be duly recorded and filed in all places necessary
to perfect the security interest of the Pledgee in the Pledged Stock. In the
event that any recording or refiling thereof )(or filing of any statements of
continuation or assignment of any financing statement) is required to protect
and preserve such security interest, the Corporate Pledgor and the Pledgor at
their own expense, shall cause the same to be re-recorded and/or refiled at the
time and in the manner requested by the Pledgee. The Corporate Pledgor and the
Pledgor hereby irrevocably designate the Pledgee, its agents, representatives
and designees, as agent and attorney-in-fact for the Corporate Pledgor and the
Pledgor for the aforesaid purposes. The UCC-1 financing statement to be executed
and delivered by the Corporate Pledgor for the Shares shall be subordinate only
to the security interest held by the factor of the Company's receivables. None
of the other UCC-1 financing statements with respect to any of the Pledged Stock
other than the Shares shall be subordinate to any security interest of any kind
held by any third party.
2. DIVIDENDS. During the term of this pledge, all dividends and other
amounts received by the Pledgee as a result of its record ownership of the
Pledged Stock shall be applied by it to the payment of the principal and
interest on the Note.
2
3. VOTING RIGHTS. During the term of this pledge, and so long as the
either the Corporate Pledgor or the Pledgor is not in default in the performance
of any of the terms of this agreement, the Corporate Pledgor and the Pledgor
shall have the right to vote the Pledged Stock on all corporate questions, and
the Pledgee shall execute due and timely proxies in favor of the Corporate
Pledgor and Pledgor to this end.
4. REPRESENTATIONS. The Corporate Pledgor and Pledgor each warrant and
represent that there are no restrictions upon the transfer of any of the Pledged
Stock, other than may appear on the face of the certificates, and that the
Corporate Pledgor and the Pledgor have the right to transfer such Pledged Stock
free of any encumbrances and without obtaining the consents of the other
shareholders.
5. ADJUSTMENTS. In the event that, during the term of this pledge, any
share dividend, reclassification, readjustment, or other change is declared or
made in the capital structure of the companies which have issued the Pledged
Stock, all new, substituted, and additional shares, or other securities, issued
by reason of any such change shall be held by the Pledgee under the terms of
this Agreement in the same manner as the Pledged Stock originally pledged
hereunder.
6. WARRANTS AND RIGHTS. In the event that during the term of this
Agreement, subscription warrants or any other rights or options shall be issued
in connection with the Pledged Stock, such warrants, rights, and options shall
be immediately assigned by the Pledgee to the Corporate Pledgor or the Pledgor,
as the case may be, and if exercised by the Corporate Pledgor or the Pledgor, as
the case may be, all new shares or other securities so acquired by the Corporate
Pledgor or the Pledgor, as the case may be, shall be immediately assigned to the
Pledgee to be held under the terms of this Agreement and the Escrow Agreement in
the same manner as the Pledged Stock originally pledged hereunder.
7. PAYMENT OF NOTE. Upon payment at maturity of the principal and
interest of the Note, less amounts theretofore received and applied by the
Pledgee in reduction thereof, the Pledgee shall transfer to the Corporate
Pledgor and the Pledgor all their respective Pledged Stock and all rights
received by the Pledgee as a result of his record ownership thereof and shall
direct the Escrow Agent as necessary to accomplish such transfer of the Pledged
Stock.
8. DEFAULT. In the event that either the Corporate Pledgor or the
Pledgor defaults in the performance of any of the terms of this Agreement, or an
Event of Default(as defined in the Note) has occurred and is continuing under
the Note, the Pledgee shall have the rights and remedies provided in the Uniform
Commercial Code in force in the State of New York at the date of this agreement
and in this connection, the Pledgee may upon five days' notice to the Escrow
Agent, the Corporate Pledgor and the Pledgor, sent by registered mail or by
overnight delivery service make demand upon the Escrow Agent for delivery of the
Pledged Stock and the Stock Powers. As more fully set forth in the Escrow
Agreement, the Escrow Agent shall turn over the Pledged Stock and Stock Powers
to the Pledgee unless it has received timely written notice of an objection by
the Corporate Pledgor or the Pledgor. In the absence of a timely written
objection, the Pledgee upon receipt of the Pledged Stock and the Stock Powers
and without liability for any diminution in price which may have occurred, sell
all the Pledged Stock in such manner and for such price as the Pledgee may
3
determine. At any bona fide public sale the Pledgee shall be free to purchase
all or any part of the Pledged Stock. Out of the proceeds of any sale the
Pledgee may retain an amount equal to the principal and interest then due on the
Note, plus the amount of the expenses of the sale, and shall pay any balance of
such proceeds to the Corporate Pledgor.
9. SEVERABILITY. In the event that any provision of this Agreement is
found to be illegal or unenforceable by any court or tribunal of competent
jurisdiction, then to the extent that such provision may be made enforceable by
amendment to or modification thereof, the parties agree to make such amendment
or modification so that the same shall be made valid and enforceable to the
fullest extent permissible under existing law and public policies in the
jurisdiction where enforcement is sought, and in the event that the parties
cannot so agree, such provision shall be modified by such court or tribunal to
conform, to the fullest extent permissible under applicable law, to the intent
of the Parties in a valid and enforceable manner, if possible and if not
possible, then be stricken entirely from the Agreement by such court or tribunal
and the remainder of this Agreement shall remain binding on the parties hereto.
10. AMENDMENT. No amendment or modification of the terms or conditions
of this Agreement shall be valid unless in writing and signed by the party or
parties to be bound thereby.
11. GOVERNING LAW. This Agreement shall be interpreted, construed,
governed and enforced according to the internal laws of the State of New York
without regard to conflict or choice of law principles of New York or any other
jurisdiction. This Agreement shall be executed in New York and is intended to be
performed in New York. In the event of litigation arising out of this Agreement,
the parties hereto consent to the personal jurisdiction of the State of New
York, County of New York.
12. NO WAIVER. If any party to this Agreement fails to, or elects not to
enforce any right or remedy to which it may be entitled hereunder or by law,
such right or remedy shall not be waived, nor shall such nonaction be construed
to confer a waiver as to any continued or future acts, nor shall any other right
or remedy be waived as a result thereof. No right under this Agreement shall be
waived except as evidenced by a written document signed by the party waiving
such right, and any such waiver shall apply only to the act or acts expressly
waived in said document.
13. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, and each such counterpart will, for all purposes, be deemed an
original instrument, but all such counterparts together will constitute but one
and the same Agreement.
14. BINDING AGREEMENT. This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto, and upon their respective heirs,
successors, assigns and legal representatives.
15. COUNSEL. Each of the parties hereto represents that it or he has
consulted legal counsel in connection with this Agreement, or has been given
full opportunity to review this Agreement with counsel of his or its choice
prior to execution thereof. Each party further agrees to bear its own costs and
expenses, including attorneys' fees, in connection with this Agreement. In the
event of any action by the Pledgee to enforce this Agreement because of an Event
of Default, the Pledgee shall be entitled to also recover costs of such action
including reasonable attorneys' fees.
4
16. NOTICES. All notices and demands permitted, required or provided
for by this Agreement shall be made in writing, and shall be deemed adequately
delivered if delivered by hand or by mailing the same via the United States
Mail, prepaid certified or registered mail, return receipt requested, or by
priority overnight courier for next business day delivery by a nationally
recognized overnight courier service that regularly maintains records of its
pick-ups and deliveries and has daily deliveries to the area to which the notice
is sent, addressed to the parties at their respective addresses as shown below:
NAME ADDRESS
To the Pledgee: National Management Consulting Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a Copy To: Moritt ▇▇▇▇ Hamroff & ▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
To ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
And Humana Trans Services
Holding Corp.: ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a Copy to: ▇▇▇▇▇▇▇ ▇▇▇▇▇, P.C.
▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Notices delivered personally shall be deemed communicated as
of the date of actual receipt. Notices mailed as set forth above shall be deemed
communicated as of the date three (3) business days after mailing, and notices
sent by overnight courier shall be deemed communicated as of the date one (1)
business day after sending.
17. ENTIRE AGREEMENT. This Agreement and the Ancillary
Agreements set forth the entire agreement and understanding of the parties
hereto in respect of the subject matter contained herein, and supersedes all
prior agreements, promises, understandings, letters of intent, covenants,
arrangements, communications, representations or warranties, whether oral or
written, by any party hereto or by any related or unrelated third party. All
exhibits attached hereto, and all certificates, documents and other
instruments delivered or to be delivered pursuant to the terms hereof are
hereby expressly made a part of this Agreement, and all references herein to
the terms "this Agreement", "hereunder", "herein", "hereby" or "hereto" shall
be deemed to refer to this Agreement and to all such writings.
18. SUCCESSORS AND ASSIGNS. As used herein the term "the
Parties" shall include their respective successors in interest, licensees or
assigns. Pledgee shall be entitled to assign this Pledge Agreement and all of
5
its rights, privileges, interests, and remedies hereunder to any other person,
firm, entity, bank, or corporation whatsoever without notice to or consent by
the Corporate Pledgor or the Pledgor and such assignee shall be entitled to
the benefits of this Pledge Agreement and to exercise all such rights,
interests, and remedies as fully as Pledgee. The Corporate Pledgor and the
Pledgor may not assign this Pledge Agreement or their obligations hereunder
without the express written consent of the Pledgee which may be withheld in
its sole discretion.
19. EXECUTION. Each person who signs this Agreement on behalf
of a corporate entity represents and warrants that he has full and complete
authority to execute this Agreement on behalf of such entity. Each party shall
bear the fees and expenses of its counsel and its own out-of-pocket costs in
connection with this Agreement.
20. CAPTIONS. The captions appearing in this Agreement are for
convenience only, and shall have no effect on the construction or
interpretation of this Agreement.
[SIGNATURE PAGE FOLLOWS]
[SIGNATURE PAGE TO PLEDGE AGREEMENT]
6
IN WITNESS WHEREOF the parties have executed this agreement on the day
first above written.
CORPORATE PLEDGOR
HUMANA TRANS
SERVICES HOLDING CORP.
By: _________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chairman and President
PLEDGOR
By:_____________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
PLEDGEE
NATIONAL MANAGEMENT
CONSULTANTS, INC.
By: _________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: President
7