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EXHIBIT 11
COLLATERAL ASSIGNMENT
This Collateral Assignment (this "Assignment") is made as of December
1, 1999, in favor of Tekgraf, Inc., a Georgia corporation ("Tekgraf") by ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇ ("▇▇▇▇▇▇").
▇▇▇▇▇▇ has borrowed $1,775,000 (the "Loan") from Tekgraf to enable
▇▇▇▇▇▇ to purchase shares of Tekgraf's Class A Common Stock, $.001 par value
(the "Class A Stock") and Class B Common Stock, $.001 par value (the "Class B
Stock") from other Tekgraf shareholders. The Loan has been made under the terms
of a Loan Agreement of even date herewith between ▇▇▇▇▇▇ and Tekgraf (the "Loan
Agreement"), and ▇▇▇▇▇▇ has delivered a Promissory Note of even date herewith to
Tekgraf in the principal amount of the Loan (together with all extensions,
renewals, amendments and modifications thereof, the "Note"). In connection with
such purchases, ▇▇▇▇▇▇ has entered into voting agreements with the sellers of
the Class A Stock and Class B Stock (referred to herein as the "Voting
Agreements" and being identified on Exhibit A hereto), and the sellers have
appointed ▇▇▇▇▇▇ as their proxy with respect to certain Class A Stock and Class
B Stock (such appointments being referred to herein as the "Proxies"). Some of
the Voting Agreements contain rights for ▇▇▇▇▇▇ to acquire Class B Stock from
the Tekgraf shareholder (all of such rights being hereinafter referred to as the
"Purchase Rights" and the related voting agreements being identified on Exhibit
A hereto). To secure the payment of all Obligations (as hereinafter defined),
▇▇▇▇▇▇ has agreed to grant Tekgraf a security interest in the Voting Agreements
and the Proxies. In addition, ▇▇▇▇▇▇ has agreed to pledge to Tekgraf certain
shares of the Class A Stock and Class B Stock under the terms of a Stock Pledge
Agreement of even date herewith (the "Pledge Agreement").
1. Transfer and Assignment. As security for payment of all liabilities and
obligations of ▇▇▇▇▇▇ to Tekgraf of every kind and description, whether
now existing or hereafter arising, fixed or contingent, due or to
become due, under the Loan Agreement or the Note (the "Obligations"),
▇▇▇▇▇▇ hereby grants to Tekgraf a security interest in all of ▇▇▇▇▇▇'▇
right, title, and interest in and to, and ▇▇▇▇▇▇ hereby collaterally
assigns to Tekgraf, the Voting Agreements, including the Purchase
Rights contained therein, and the Proxies.
2. Warranties of ▇▇▇▇▇▇. ▇▇▇▇▇▇ hereby warrants to Tekgraf that: ▇▇▇▇▇▇
has full power and authority to execute and deliver this Assignment;
▇▇▇▇▇▇ has not assigned to any person or entity any of his rights under
the Voting Agreements or the Proxies; the Voting Agreements and Proxies
have not been modified, amended or revoked; ▇▇▇▇▇▇ is not prohibited
under any agreement with any other person or entity, or under any
judgment or decree, from the execution, delivery and performance of
this Assignment; and no action has been brought or, to
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▇▇▇▇▇▇'▇ knowledge, threatened which might prohibit or interfere with
the execution, delivery and performance of this Assignment.
3. Rights Prior to Default. Prior to the occurrence of a Default under
the Loan Agreement, ▇▇▇▇▇▇ may exercise all rights under the Voting
Agreements and the Proxies, and Tekgraf may not exercise any rights
thereunder.
4. Rights After Default. From and after the occurrence of a Default
under the Loan Agreement, while such Default continues and subject to
any applicable cure period, Tekgraf shall have the right to cause the
purchases of the shares under the Purchase Rights to be completed, with
the Class B Stock acquired thereby to be subject to the terms of the
Pledge Agreement, and to exercise any other rights accruing to ▇▇▇▇▇▇
under the Voting Agreements and the Proxies. If Tekgraf exercises such
rights, all amounts spent by Tekgraf in connection with such exercise
shall be added to and become part of the Obligations for purposes
hereof and of the Pledge Agreement. ▇▇▇▇▇▇ hereby constitutes and
appoints Tekgraf, with full power of substitution, ▇▇▇▇▇▇'▇
attorney-in-fact for the purpose of carrying out the provisions of this
Assignment and taking any action and executing any instrument which
Tekgraf may deem necessary or advisable to accomplish the purposes
hereof, which appointment is coupled with an interest and is
irrevocable.
5. Further Assurances. ▇▇▇▇▇▇ agrees to execute and deliver such other
documentation and such further assurances as Tekgraf shall from time to
time reasonably require in order to preserve and maintain the security
provided hereby, including but not limited to UCC financing statements.
6. Termination. Upon payment in full of all principal and interest on
the Note and all other sums due in respect of all other Obligations,
this Assignment shall terminate.
7. Miscellaneous.
(a) Amendments. This Assignment may not be amended or supplemented
except in writing by Tekgraf and ▇▇▇▇▇▇.
(b) Effect of Headings. The section headings herein are for convenience
only and shall not affect the construction or interpretation of
this Assignment.
(c) Binding Effect. This Assignment shall be binding upon and shall
inure to the benefit of the parties hereto and their respective
principals, heirs, legal representatives, assigns and successors.
(d) Governing Law. This Assignment shall be governed by and construed
in accordance with the laws of the United States of America and the
State of Georgia. Tekgraf and ▇▇▇▇▇▇ irrevocably consent to the
exclusive jurisdiction and venue of the courts of any county in the
State of
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Georgia and the United States District Court for the Northern
District of Georgia, in any judicial proceeding brought to
enforce this Assignment. The parties agree that any forum other
than the State of Georgia is an inconvenient forum and that a
lawsuit (or non-compulsory counterclaim) brought by one party
against another party in a court of any jurisdiction other than
the State of Georgia should be forthwith dismissed or
transferred to a court located in the State of Georgia.
(e) Notices. All notices or other communications hereunder shall be
in writing and shall be deemed to have been validly served,
given or delivered (i) five (5) days after deposit in the
United States mail, prepaid, by certified mail, with return
receipt requested; (ii) when delivered personally; (iii) one
(1) day after delivery to a nationally-recognized overnight
courier; or (iv) when transmitted by fax with telephone
confirmation of receipt if a copy is concurrently transmitted
by U.S. mail or overnight courier as stated above; in all
cases, if applicable, with delivery prepaid and addressed to
the party to be notified to the address set forth beneath such
party's signature below, or to such other address and fax
number of which a party has given notice to the other party as
provided in this subsection.
(f) Severability. Whenever possible, each provision of this
Assignment shall be interpreted in such a manner as to be
effective and valid under applicable law, but if any provision
of this Assignment shall be deemed prohibited or invalid under
such applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, but such prohibition
or invalidity shall not invalidate the remainder of such
provision or the other provisions of this Assignment.
The undersigned have executed and delivered this Assignment as of the
date first written above.
TEKGRAF, INC.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ W. ▇▇▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
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EXHIBIT A
VOTING AGREEMENTS
Agreement dated December 1, 1999 between A. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ (see attached copy)
Agreement dated December 1, 1999 between ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
(see attached copy)
Agreement dated December 1, 1999 between ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (see
attached copy)
Agreement dated December 1, 1999 between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
(see attached copy)*
Agreement dated December 1, 1999 between J. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
(see attached copy)*
*These Voting Agreements also contain Purchase Rights.
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