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Exhibit 10.37
AMENDED AND RESTATED
PLEDGE AGREEMENT
AMENDED AND RESTATED PLEDGE AGREEMENT made as of this 26 day of June, 1997,
amending and restating a certain Pledge Agreement made as of the 31st day of
May, 1996 and amended by Amendment to Pledge Agreement dated July 24, 1996,
between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ whose address is ▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Pledgor") and Bank of Boston Connecticut having an
office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Pledgee").
In consideration of the mutual agreements made herein and for other good
and valuable consideration, receipt of which is hereby acknowledged, it is
hereby agreed as follows:
1. Pledgor hereby pledges and grants to Pledgee a security interest in:
(a) bank account #154681816 on deposit with Pledgee; and
(b) custody account #▇▇▇▇▇▇▇ held with Pledgee, and all cash,
securities (certificated and uncertificated), commodities, contracts,
instruments, documents and agreements contained therein, and all general
intangibles associated therewith;
together, in each instance, with all dividends, interest, earnings, profits
and proceeds thereof, and all renewals, replacements and substitutes therefor
and all other property acquired with the proceeds thereof, (collectively, the
"Collateral") as security for the due payment and performance of (i) all
indebtedness, obligations and liabilities of Pledgor to Pledgee arising under
this Agreement and Pledgor's Limited Guaranty Agreement dated as of May 31, 1996
guaranteeing certain obligations of ▇▇▇▇▇▇▇ International, Ltd. ("Borrower"),
and (ii) all costs, expenses and reasonable attorneys' fees incurred in the
enforcement or administration of the Limited Guaranty Agreement or in the
defense or enforcement of this Agreement (collectively, the "Obligations").
Account #154681816 and Account #▇▇▇▇▇▇▇ shall be blocked accounts from
which Pledgor shall be able to withdraw collateral only with the consent of
Pledgee, as herein provided. Pledgor grants Pledgee the right and option to
register Collateral in the
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name of Pledgee for purposes of securing Pledgee's lien in the Collateral on the
condition that upon payment and final satisfaction of the Obligations, the
Collateral shall be reconveyed to Pledgor, at his option.
2. Pledgor hereby irrevocably grants Pledgee a power of attorney, coupled
with an interest, with respect to the Collateral for all purposes consistent
with this Agreement. Said power of attorney shall include, but shall not be
limited to, the power to withdraw, transfer, renew and reinvest securities
constituting Collateral, to execute instruments in Pledgor's name, to register
securities constituting Collateral in Pledgee's name and to take such other
action to enforce any of Pledgee's rights with respect to the Collateral.
3. Pledgor represents, warrants and covenants to Pledgee that (a) he has
good title to all the Collateral, free and clear of all claims, mortgages,
pledges, liens, security interests and other encumbrances of every nature
whatsoever, except the pledge evidenced hereby, (b) the Collateral is duly and
validly pledged with Pledgee in accordance with law, (c) he has the unrestricted
right to make this pledge, and (d) he will defend Pledgee's right and security
interest in and to the Collateral against the claims and demands of all persons
whomsoever.
4. Upon the stated maturity date of any debt instruments constituting
Collateral, Pledgee may, at its option and with no liability for failure to do
so, invest the proceeds thereof, including both principal and interest, in
short-term debt instruments or certificates of deposit of its choice, bearing
interest at the then prevailing market rates, unless Pledgor notifies Pledgee to
the contrary not less than ten (10) business days prior to such maturity date.
The proceeds of all such debt instruments may be continuously reinvested by
Pledgee on the aforesaid basis, unless Pledgor give the aforesaid notification.
5. Unless Pledgee otherwise agrees in writing, if Pledgor receives any
dividend, or other distribution in connection with the Collateral, whether in
cash, or otherwise, the same shall constitute Collateral, and Pledgor agrees to
accept the same in trust for Pledgee and to forthwith deliver the same to
Pledgee, or its designee, in the exact form received, with Pledgor's endorsement
and/or assignment when necessary, to be held by Pledgee, or its designee, as
Collateral security for the Obligations.
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6. Pledgor covenants that he will not sell, convey or otherwise dispose of
any of the Collateral, or create, incur or permit to exist any pledge, mortgage,
lien, charge, encumbrance or any security interest whatsoever with respect to
any of the Collateral or the proceeds thereof other than the lien and security
interest granted to the Pledgee hereunder. Notwithstanding the foregoing,
Pledgor shall have the right to require Pledgee to sell Collateral consisting of
municipal bonds provided (i) no Event of Default shall exist or would exist but
for the passage of time, the service of notice or both and (ii) the proceeds of
such sale shall continue as Collateral, subject to release pursuant to Section 8
below.
7. In the event of failure of payment or performance of the Obligations (an
"Event of Default"), Pledgee shall have the right to withdraw the Collateral and
apply the Collateral to the Obligation and, in addition, Pledgee shall have all
of the rights and remedies of a secured party under the Uniform Commercial Code
of Connecticut ("Code") or other applicable law, and Pledgee may cause any of
the Collateral to be transferred into Pledgee's name or the name of its nominee
and shall receive the income thereon and hold the same as Collateral security
for the Obligations, or apply it to any Obligations in such proportions as
Pledgee shall determine in its sole discretion, and shall have the right, for
and in the name and place of Pledgor, to execute endorsements, assignments, or
other instruments of conveyance or transfer with respect to any of the
Collateral.
8. So long as no Event of Default shall exist or would exist but for the
passage of time, the serving of notice or both, Pledgor shall be entitled to
request from time to time that Pledgee release Collateral to Pledgor as follows:
a. Pledgor shall at all times maintain Eligible Collateral Value equal
to or greater than the amount outstanding under a certain $1,750,000 Revolving
Promissory Note dated as of May 31, 1996 from Borrower to Pledgee ("Note").
b. In the event Eligible Collateral Value exceeds the amount outstanding
under the Note and Pledgor has requested a release of Collateral, Pledgee shall
release the requested amount of Collateral to Pledgor within three (3) business
days following such request; provided, however, that the condition of
subparagraph (a) above must be met at all times.
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c. For purposes of the Agreement, "Eligible Collateral Value" shall mean
the aggregate of (i) 100% of the value of all Collateral constituting cash and
(ii) 85% of the fair market value, as determined by Pledgee in its commercially
reasonable judgment, of all Collateral constituting municipal bonds rated BAA
or higher by Standard & Poors, in which Pledgee has a perfected, first priority
security interest.
Until written notification from Pledgor is received by Pledgee, Pledgee shall
release Collateral only upon the written request of ▇▇▇▇ ▇▇▇▇▇▇▇, Chief
Financial Officer of Borrower. Provided the conditions of this paragraph 8 are
met, Pledgee hereby agrees to comply with such request.
9. In the event of a sale or assignment by Pledgee of all or any of the
Obligations held by it, Pledgee may assign or transfer its rights and interest
under this Agreement in whole or in part to the purchaser or purchasers of such
Obligations, whereupon such purchaser or purchasers shall become vested with all
of the powers and rights given to Pledgee hereunder, and Pledgee shall
thereafter be forever released and fully discharged from any liability or
responsibility hereunder with respect to the rights and interest so assigned.
10. Beyond the exercise of reasonable care to assure the safe custody of
the Collateral while held hereunder, Pledgee shall have no duty or liability to
collect any sums due in respect thereof or to protect or preserve rights
pertaining thereto, and shall be relieved of all responsibility for the
Collateral upon surrendering the same to Pledgor.
11. No course of dealing between Pledgor and Pledgee, nor any failure to
exercise, nor any delay in exercising, on the part of Pledgee, any right, power
or privilege hereunder or under any of the Obligations, shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or thereunder preclude any other or further exercise thereof
or the exercise of any other right, power or privilege. The rights and remedies
provided herein and under any of the Obligations are cumulative and are in
addition to, and not exclusive of, any rights or remedies provided by law,
including without limitation, the rights and remedies of a secured party under
the Code.
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12. Notice to or demand upon Pledgor or Pledgee hereunder shall be
deemed sufficient and commercially reasonable notice and shall be effective
when delivered in hand, or one (1) day after delivery to an overnight mail or
messenger service or three (3) days after being deposited in the mails, first
class, postage prepaid, registered or certified mail, return receipt requested,
to the address stated in the first paragraph of this Agreement and to Pledgor
at Suite 1919, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or to such other
address as the party to whom such notice is directed may have designated by
written notice similarly given to the other party hereto.
13. Pledgor hereby waives notice of acceptance of this Agreement as
well as presentment, demand, payment, notice of dishonor or protest and all
other notices of any kind in connection with any of the Obligations. Pledgee
may amend, modify, alter, extend, renew or otherwise change any terms of the
revolving loans ("Revolving Loans") extended by Pledgee to Borrower pursuant to
a certain Revolving Loan and Security Agreement dated as of May 31, 1996
between Pledgee and Borrower, or any agreements and documents evidencing,
securing or in any way relating to the Revolving Loans, without giving Pledgor
notice, and Pledgor hereby consents to the same. In addition, Pledgee may
release, substitute, supersede, exchange or modify any other collateral
security it may from time to time hold, and release, substitute, surrender or
modify the liability of any third party, without giving Pledgor notice, and
Pledgor hereby consents to the same. Pledgee shall be under no duty to first
exhaust its rights against any such collateral security or any such third
party before realizing on the Collateral. Such modifications, extensions,
changes, renewals, releases, substitutions or other actions shall in no way
affect Pledgor's obligations hereunder. PLEDGOR FURTHER WAIVES ANY RIGHT TO
NOTICE AND HEARING UNDER CHAPTER 903A OF THE CONNECTICUT GENERAL STATUTES, OR
AS OTHERWISE ALLOWED BY ANY STATE OR FEDERAL LAW WITH RESPECT TO ANY
PREJUDGMENT REMEDY WHICH PLEDGEE MAY DESIRE TO USE. PLEDGOR HEREBY WAIVES
TRIAL BY JURY IN ANY COURT AND IN ANY SUIT ACTION OR PRECEDING ON ANY MATTER
ARISING IN CONNECTION WITH OR IN ANY WAY RELATED TO THIS AGREEMENT OR THE
ENFORCEMENT OF ANY OF PLEDGEE'S RIGHT AND REMEDIES. PLEDGOR'S WAIVER UNDER THIS
SECTION HAS BEEN
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MADE VOLUNTARILY AND KNOWINGLY AND AFTER CONSIDERATION OF THE RAMIFICATIONS
THEREOF WITH HIS ATTORNEYS.
14. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective heirs, executors, administrators,
successors and assigns, and the term "Pledgee" shall be deemed to include any
other holder or holders of any of the Obligations. As used herein, plural or
singular include each other, and pronouns of any gender are to be construed as
masculine, feminine or neuter, as context requires.
15. This Agreement shall be construed in accordance with and governed
by the internal laws of the State of Connecticut. Pledgor hereby consents to
service of process, and to be sued, in the State of Connecticut and consents to
the exclusive jurisdiction of the courts of the State of Connecticut and the
United States District Court for the District of Connecticut, for the purpose of
any suit, action or other proceeding arising hereunder, and expressly waives
any and all objections it may have to venue in any such courts. Pledgee may, in
writing specifically referring to this paragraph of this Agreement, waive the
exclusive jurisdiction provision of this paragraph 15.
16. This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original but all of which together shall constitute
one and the same instrument. This Agreement shall be effective as of May 31,
1996, notwithstanding the actual date of execution.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
WITNESSES:
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▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
BY /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Its: Vice President
WITNESSES:
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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STATE OF CONNECTICUT )
) ss NORWILL
COUNTY OF NEW CONDOR ) June 26, 1997
Personally appeared ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, signer and sealer of the
foregoing instrument, and acknowledged the same to be his free act and deed,
before me.
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------
COMMISSIONER OF THE
SUPERIOR COURT
STATE OF CONNECTICUT )
) ss NEWHAVEN
COUNTY OF NEW HAVEN ) June 26, 1997
Personally appeared, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, of BANK OF BOSTON CONNECTICUT,
signer and sealer of the foregoing instrument, and acknowledged the same to
be his/her free act and deed as such officer and the free act and deed of
said Corporation, before me.
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
COMMISSIONER OF THE SUPERIOR COURT
NOTARY PUBLIC
My Comm. exp. 12/31/00
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AFFIRMATION OF LIMITED GUARANTY AGREEMENT AND
PLEDGE AGREEMENT
WITNESSETH:
Affirmation Of Limited Guaranty Agreement and Pledge Agreement dated this
_____ day of February, 1998, by and among JUNE ▇. ▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. and the UNITED STATES TRUST COMPANY OF NEW YORK, as
co-executors of the ESTATE OF ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Late of New York, NY ("Geneen")
and BankBoston, N.A., successor by merger to Bank of Boston Connecticut
("Bank").
WHEREAS, Geneen executed a Limited Guaranty Agreement in favor of Bank as
of May 31, 1996 (as reaffirmed by Reaffirmation of Limited Guaranty dated March
17, 1997 and Second Reaffirmation of Limited Guaranty dated June 26, 1997, the
"Guaranty") unconditionally guaranteeing full and prompt payment of any and all
Liabilities, as defined in the Guaranty, owed by ▇▇▇▇▇▇▇ International, Ltd.
("Borrower") to the Bank, including without limitation, amounts advanced to
Borrower by Bank pursuant to a Revolving Loan and Security Agreement dated as
of May 31, 1996 (as amended by Amendment Agreement dated as of the 17th day of
March, 1997, Second Amendment Agreement dated June 26, 1997 and Third Amendment
Agreement dated September 30, 1997, the "Loan Agreement").
WHEREAS, to secure his obligations under the Guaranty, Geneen executed and
delivered to the Bank a Pledge Agreement dated as of May 31, 1996 (as amended
and restated by Amended and Restated Pledge Agreement dated as of June 26,
1997, the "Pledge Agreement").
WHEREAS, Geneen died at New York, New York, on November 21, 1997;
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WHEREAS, Geneen's death constitutes an Event of Default under the Loan
Agreement; and
WHEREAS, the Bank has agreed to forebear from declaring a default under
the Loan Agreement by reason of Geneen's death on the condition that the Estate
of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ acknowledge, confirm and allow the claim of the Bank under
the Guaranty and Pledge and affirm its obligations under said Guaranty and
Pledge, as permitted under Section 1806 of the New York Surrogate's Court
Procedure Act ("SCPA");
NOW, THEREFORE, the undersigned hereto agrees as follows:
1. The undersigned hereby acknowledge and affirm its obligations under
the Guaranty and Pledge and hereby agree and acknowledge that its obligations
under the Guaranty and Pledge are not subject to a right of setoff,
counterclaim on rights which may reduce or eliminate its obligations
thereunder. The undersigned hereby promises to pay amounts when required under
the Guaranty to the Bank. The undersigned further confirm and allow the claim
of the Bank under the Guaranty and Pledge pursuant to SCPA Section 1806.
2. The undersigned hereby acknowledge that the Bank is entitled to
declare an event of default by reason of Geneen's death and has relied upon this
Affirmation of Limited Guaranty Agreement and Pledge Agreement in not declaring
a default under the Loan Agreement.
3. Except as otherwise expressly provided for herein, nothing in this
Affirmation of Limited Guaranty Agreement and Pledge Agreement shall extend to
or affect in any way
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any of the Borrower's or Geneen's or his Estate's obligations to the Bank or the
Bank's rights and remedies arising under the Financing Agreements, and the Bank
shall not be deemed to have waived any of its rights or remedies with respect to
any Event of Default (other than an Event of Default arising under the Loan
Agreement by reason of the death of Geneen) or event or condition which, with
notice or the lapse of time, or both would become an Event of Default.
Notwithstanding any provision in the Guaranty to the contrary, the undersigned
will have against the Borrower full rights of indemnity, reimbursement,
contribution and subrogation, and the right to prove claims in bankruptcy or
insolvency proceedings, only upon full and final payment of all obligations of
the borrower to the Bank.
4. The rights, privileges, duties and obligations of the parties under the
Financing Agreements shall remain unchanged and in full force and effect, and
nothing contained herein shall operate to release the Borrower from its
liability to pay the indebtedness under the Financing Agreements and to keep
and perform the other terms, conditions and obligations and agreements
contained therein.
5. Capitalized terms not otherwise defined herein shall have the same
definitions as provided in the Loan Agreement.
6. This Affirmation Of Limited Guaranty Agreement and Pledge Agreement may
be executed in any number of counterparts, but all such counterparts shall
together constitute but one instrument. In making proof of this Affirmation Of
Limited Guaranty Agreement and Pledge Agreement, it shall not be necessary to
produce or account for more than one counterpart signed by each party hereto by
and against which enforcement hereof is sought.
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IN WITNESS WHEREOF, the undersigned has executed this Affirmation Of
Limited Guaranty Agreement and Pledge Agreement on this __day of February, 1998.
WITNESSES: THE ESTATE OF ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ II By: /s/ June ▇. ▇▇▇▇▇▇
-------------------------------- ---------------------------------------
June ▇. ▇▇▇▇▇▇, Its Co-Executor
▇▇▇▇ ▇. ▇▇▇▇
--------------------------------
By:
-------------------------------- ---------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., Its Co-Executor
--------------------------------
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------- ---------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., Its Co-Executor
--------------------------------
By: UNITED STATES TRUST COMPANY
-------------------------------- OF NEW YORK, Its Co-Executor
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
------------------------------------------
Its
ACKNOWLEDGED AND AGREED:
BANKBOSTON, N.A.
By:
------------------------------------------
Its
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STATE OF ) SS:
COUNTY OF)
FEBRUARY 13, 1998
On the day of February, 1998, before me, the undersigned officer, personally
appeared JUNE ▇. ▇▇▇▇▇▇, personally known to me (or satisfactorily proven) who
acknowledged herself to be the person whose name subscribed to the within
instrument and acknowledged that she executed the same for the purposes therein
contained.
In witness whereof I hereunto set my hand.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------
Notary Public
My Commission Expires
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, NOTARY PUBLIC
MY COMMISSION EXPIRES APRIL 2, 2002
STATE OF ) SS:
COUNTY OF)
, 1998
On the day of February, 1998, before me, the undersigned officer, personally
appeared ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., personally known to me (or satisfactorily proven)
who acknowledged himself to be the person whose name subscribed to the within
instrument and acknowledged that he executed the same for the purposes therein
contained.
In witness whereof I hereunto set my hand.
--------------------
Notary Public
My Commission Expires
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STATE OF ) SS:
COUNTY OF )
, 1998
On the day of February, 1998, before me, the undersigned officer, personally
appeared ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., personally known to me (or satisfactorily
proven) who acknowledged himself to be the person whose name subscribed to the
within instrument and acknowledged that he executed the same for the purposes
therein contained.
In witness whereof I hereunto set my hand.
--------------------
Notary Public
My Commission Expires
STATE OF ) SS:
COUNTY OF )
, 1998
On the day of February, 1998, before me, the undersigned officer, personally
appeared of UNITED STATES TRUST COMPANY OF NEW YORK,
personally known to me (or satisfactorily proven) who acknowledged
himself/herself to be the person whose name subscribed to the within instrument
and acknowledged that he/she executed the same for the purposes therein
contained.
In witness whereof I hereunto set my hand.
--------------------
Notary Public
My Commission Expires
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15
STATE OF ) SS:
COUNTY OF )
, 1998
On the day of February, 1998, before me, the undersigned officer, personally
appeared of BANKBOSTON, N.A., personally known to me (or
satisfactorily proven) who acknowledged himself/herself to be the person whose
name subscribed to the within instrument and acknowledged that he/she executed
the same for the purposes therein contained.
In witness whereof I hereunto set my hand.
---------------------
Notary Public
My Commission Expires
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