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EXHIBIT 10.6
AMENDED AND RESTATED PLEDGE AGREEMENT
This Amended and Restated Pledge Agreement (the "Agreement") is dated
as of May ___, 1998, by and among the parties executing this Agreement under the
heading "Pledgors" (such parties, along with any parties who execute and deliver
to the Agent an agreement in the form attached hereto as Schedule E, being
hereinafter referred to collectively as the "Pledgors" and individually as a
"Pledgor"), each with its mailing address as set forth on the signature page
hereto and ▇▇▇▇▇▇ TRUST AND SAVINGS BANK, an Illinois banking corporation
("▇▇▇▇▇▇"), with its mailing address at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, acting as agent hereunder for the Secured Creditors hereinafter
identified and defined (▇▇▇▇▇▇ acting as such agent and any successor or
successors to ▇▇▇▇▇▇ acting in such capacity being hereinafter referred to as
the "Agent");
PRELIMINARY STATEMENTS
▇. ▇▇▇▇▇▇ Industrial Group, Inc., a Georgia corporation (the
"Company"), certain subsidiaries of the Company, ▇▇▇▇▇▇, individually and as
agent, and certain lenders are currently party to a Credit Agreement dated as of
January 20, 1998 (such Credit Agreement, as the same may have been amended or
modified from time to time, including amendments and restatements thereof in its
entirety, being hereinafter referred to as the "Prior Credit Agreement"),
pursuant to which ▇▇▇▇▇▇ and other lenders from time to time party to the Credit
Agreement agreed, subject to certain terms and conditions, to extend credit and
make certain other financial accommodations available to the "Borrowers"
identified therein.
B. The Company and certain subsidiaries of the Company are currently
party to a Pledge Agreement dated as of January 20, 1998, with ▇▇▇▇▇▇,
individually and as agent for the lenders party to the Prior Credit Agreement
(the "Prior Pledge Agreement"), pursuant to which the Company and such other
subsidiaries have granted liens on certain personal property as collateral
security for the indebtedness, obligations, and liabilities of the "Borrowers"
owing to such lenders under the Prior Credit Agreement.
C. Concurrently herewith, ▇▇▇▇▇▇ and the other lenders party to the
Prior Credit Agreement are refinancing all indebtedness, obligations, and
liabilities owed to such lenders by the "Borrowers" under the Prior Credit
Agreement (the "Prior Obligations").
D. The Company and ▇▇▇▇▇▇, individually and as Agent, have also
entered into a Credit Agreement dated of even date herewith (such Credit
Agreement, as the same may be amended or modified from time to time, including
amendments and restatements thereof in its entirety, being hereinafter referred
to as the "Credit Agreement") pursuant to which ▇▇▇▇▇▇ and
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other lenders which from time to time become party thereto (▇▇▇▇▇▇ and such
other lenders which from time to time become party thereto being hereinafter
referred to collectively as the "Lenders" and individually as a "Lender") have
agreed to modify the terms and conditions applicable to the Prior Obligations
and to provide for additional credit and financial accommodations to be made
available to the Company thereunder, all subject to the terms and conditions
therein set forth.
E. The Company may from time to time enter into one or more interest
rate exchange, cap, collar, floor or other agreements with one or more of the
Lenders party to the Credit Agreement, or their affiliates, for the purpose of
hedging or otherwise protecting the Company against changes in interest rates
(the liability of the Company in respect of such agreements with such Lenders
and their affiliates being hereinafter referred to as the "Hedging Liability")
(the affiliates of the Lenders to which any Hedging Liability is owed, together
with the Lenders and the Agent, being collectively referred to herein as the
"Secured Creditors").
F. As a condition precedent to extending credit or otherwise making
financial accommodations available to the Company under the Credit Agreement,
the Lenders have required, among other things, that each Pledgor grant to the
Agent for the benefit of the Secured Creditors a lien on and security interest
in certain personal property of such Pledgor pursuant to this Agreement.
G. The Company owns, directly or indirectly, all or substantially
all of the equity interests in each Pledgor (other than the Company) and
provides each such Pledgor with financial, management, administrative, and
technical support which enables such Pledgor to conduct its business in an
orderly and efficient manner in the ordinary course.
H. Each Pledgor will benefit, directly or indirectly, from credit
and other financial accommodations extended by the Secured Creditors to the
Company.
NOW, THEREFORE, for and in consideration of the execution and delivery
by the Lenders of the Credit Agreement, and other good and valuable
consideration, receipt whereof is hereby acknowledged, the parties hereto hereby
agree as follows:
Section 1. Terms Defined in Credit Agreement. All capitalized
terms used herein without definition shall have the same meanings herein as such
terms have in the Credit Agreement. The term "Pledgor" and "Pledgors" as used
herein shall mean and include the Pledgors collectively and also each
individually, with all grants, representations, warranties and covenants of and
by the Pledgors, or any of them, herein contained to constitute joint and
several grants, representations, warranties and covenants of and by the
Pledgors; provided, however, that unless the context in which the same is used
shall otherwise require, any grant, representation,
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warranty or covenant contained herein related to the Collateral shall be made by
each Pledgor only with respect to the Collateral owned by it or represented by
such Pledgor as owned by it.
Section 2. Grant of Security Interest in the Collateral. Each
Pledgor hereby grants to the Agent a security interest in, in each case for the
ratable benefit of the Secured Creditors, and acknowledges and agrees that the
Agent has and shall continue to have for the ratable benefit of the Secured
Creditors a continuing security interest in, any and all right, title and
interest of each Pledgor, whether now owned or existing or hereafter created,
acquired or arising, in and to the following (collectively, the "Collateral"):
(a) Stock Collateral. (i) All shares of the capital stock of
each of the issuers listed and described on Schedule A attached hereto
owned or held by such Pledgor, whether now owned or hereafter acquired
(those shares delivered to and deposited with the Agent on the date
hereof being listed and described on Schedule A attached hereto), and
all substitutions and additions to such shares (herein, the "Pledged
Securities"), (ii) all dividends, distributions and sums distributable
or payable from, upon or in respect of the Pledged Securities and (iii)
all other rights and privileges incident to the Pledged Securities (all
of the foregoing being hereinafter referred to collectively as the
"Stock Collateral");
(b) Partnership Interest Collateral. (i) Each partnership
identified on Schedule B attached hereto and made a part hereof (such
partnerships being hereinafter referred to collectively as the
"Partnerships" and individually as a "Partnership") and (ii) any and
all payments and distributions of whatever kind or character, whether
in cash or other property, at any time made, owing or payable to such
Pledgor in respect of or on account of its present or hereafter
acquired interests in the Partnerships, whether due or to become due
and whether representing profits, distributions pursuant to complete or
partial liquidation or dissolution of any such Partnership,
distributions representing the complete or partial redemption of such
Pledgor's interest in any such Partnership or the complete or partial
withdrawal of such Pledgor from any such Partnership, repayment of
capital contributions, payment of management fees or commissions, or
otherwise, and the right to receive, receipt for, use and enjoy all
such payments and distributions (all of the foregoing being hereinafter
collectively called the "Partnership Interest Collateral"); and
(c) Proceeds. All proceeds of the foregoing.
All terms which are used in this Agreement which are defined in the Uniform
Commercial Code of the State of Illinois ("UCC") shall have the same meanings
herein as such terms are defined in the UCC, unless this Agreement shall
otherwise specifically provide.
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Section 3. Obligations Hereby Secured. This Agreement is made and
given to secure, and shall secure, the payment and performance of (i) (x) any
and all indebtedness, obligations and liabilities of the Company to the Agent,
the Lenders, or any of them individually, evidenced by or otherwise arising out
of or relating to the Credit Agreement or any promissory note of the Company
issued at any time under the Credit Agreement (including all notes issued in
extension or renewal thereof or in substitution or replacement therefor) and (y)
any liability of the Pledgors, or any of them individually, arising out of the
Credit Agreement, as well as for any and all other indebtedness, obligations and
liabilities of the Pledgors, or any of them individually, to the Secured
Creditors with respect to any Hedging Liability, or any of them individually,
evidenced by or otherwise arising out of or relating to this Agreement or any
other Loan Document or (in the case of any Hedging Liability) any other
agreement with any one or more of the Secured Creditors, in each case, whether
now existing or hereafter arising (and whether arising before or after the
filing of a petition in bankruptcy), due or to become due, direct or indirect,
absolute or contingent, and howsoever evidenced, held or acquired, and (ii) any
and all expenses and charges, legal or otherwise, suffered or incurred by the
Agent, the Secured Creditors, or any of them individually, in collecting or
enforcing any of such indebtedness, obligations or liabilities or in realizing
on or protecting or preserving any security therefor, including, without
limitation, the lien and security interest granted hereby (all of the foregoing
being hereinafter referred to as the "Obligations"). Notwithstanding anything in
this Agreement to the contrary, the right of recovery against any Pledgor (other
than the Company to which this limitation shall not apply) under this Agreement
shall not exceed $1 less than the amount which would render such Pledgor's
obligations under this Agreement void or voidable under applicable law,
including fraudulent conveyance law.
Section 4. Covenants, Agreements, Representations and Warranties.
Each Pledgor hereby covenants and agrees with, and represents and warrants to,
the Agent and the Secured Creditors that:
(a) Each Pledgor is and shall be the sole and lawful legal,
record and beneficial owner of its Collateral. Each Pledgor's chief
executive office or place of business at the address listed under such
Pledgor's name on Schedule A and Schedule B hereto, as applicable. Each
Pledgor agrees that it will not change any location set forth on the
applicable Schedule hereto without prior written notice to the Agent,
unless such location shall be outside the United States, in which
event, the Agent's prior written consent shall be required, which
consent shall not be unreasonably withheld. No Pledgor shall, without
the Agent's prior written consent, sell, assign, or otherwise dispose
of the Collateral or any interest therein. The Collateral, and every
part thereof, is and shall be free and clear of all security interests,
liens, rights, claims, attachments, levies and encumbrances of every
kind, nature and description and whether voluntary or involuntary,
except for the security interest of the Agent hereunder and for other
Liens
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which are expressly permitted by the Credit Agreement. Each Pledgor
shall warrant and defend the Collateral against any claims and demands
of all persons at any time claiming the same or any interest in the
Collateral adverse to the Agent and the Secured Creditors.
(b) Each Pledgor agrees to execute and deliver to the Agent
such further agreements, assignments, instruments and documents and to
do all such other things as the Agent may deem necessary or appropriate
to assure the Agent its lien and security interest hereunder, including
such assignments, acknowledgments (including acknowledgments of
assignment in the form attached hereto as Schedule C) stock powers,
financing statements, instruments and documents as the Agent may from
time to time require in order to comply with the Uniform Commercial
Code as enacted in the State of Illinois and any successor statute(s)
thereto (the "UCC"). Each Pledgor hereby agrees that a carbon,
photographic or other reproduction of this Agreement or any such
financing statement is sufficient for filing as a financing statement
by the Agent without notice thereof to such Pledgor wherever the Agent
in its discretion desires to file the same. In the event for any reason
the law of any jurisdiction other than Illinois becomes or is
applicable to the Collateral or any part thereof, or to any of the
Obligations, each Pledgor agrees to execute and deliver all such
agreements, assignments, instruments and documents and to do all such
other things as the Agent in its sole discretion deems necessary or
appropriate to preserve, protect and enforce the lien and security
interest of the Agent under the law of such other jurisdiction to at
least the same extent as such security interests would be protected
under the UCC.
(c) If, as and when any Pledgor (x) delivers any securities
for pledge hereunder in addition to those listed on Schedule A hereto
or (y) pledges interests in any Partnership in addition to those listed
on Schedule B hereto, the Pledgors shall furnish to the Agent a duly
completed and executed amendment to such Schedule in substantially the
form (with appropriate insertions) of Schedule D hereto reflecting the
securities pledged hereunder after giving effect to such addition.
(d) None of the Collateral constitutes margin stock (within
the meaning of Regulation U of the Board of Governors of the Federal
Reserve System).
(e) On failure of any Pledgor to perform any of the
agreements and covenants herein contained, the Agent may, at its
option, perform the same and in so doing may expend such sums as the
Agent may deem advisable in the performance thereof, including, without
limitation, the payment of any taxes, liens and encumbrances,
expenditures made in defending against any adverse claim, and all other
expenditures which the Agent may be compelled to make by operation of
law or which Agent may make by agreement or otherwise for the
protection of the security hereof. All such sums
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and amounts so expended shall be repayable by the Pledgors immediately
without notice or demand, shall constitute additional Obligations
secured hereunder and shall bear interest from the date said amounts
are expended at the rate per annum (computed on the basis of a 365-day
or 366-day year, as the case may be, for the actual number of days
elapsed) determined by adding 2% to the Base Rate (such rate per annum
as so determined being hereinafter referred to as the "Default Rate").
No such performance of any covenant or agreement by the Agent on behalf
of such Pledgor, and no such advancement or expenditure therefor, shall
relieve such Pledgor of any default under the terms of this Agreement
or in any way obligate the Agent or any Secured Creditor to take any
further or future action with respect thereto. The Agent, in making any
payment hereby authorized, may do so according to any ▇▇▇▇, statement
or estimate procured from the appropriate public office or holder of
the claim to be discharged without inquiry into the accuracy of such
▇▇▇▇, statement or estimate, or into the validity of any tax
assessment, sale, forfeiture, tax lien or title or claim. The Agent, in
performing any act hereunder, shall be the sole judge of whether the
relevant Pledgor is required to perform the same under the terms of
this Agreement. The Agent is hereby authorized to charge any depository
or other account of any Pledgor maintained with the Agent for the
amount of such sums and amounts so expended.
Section 5. Special Provisions Re: Stock Collateral.
(a) Each Pledgor has the right to vote the Pledged Securities
and there are no restrictions upon the voting rights associated with,
or the transfer of, any of the Pledged Securities, except as provided
by federal and state laws applicable to the sale of securities
generally.
(b) The certificates for all shares of the Pledged Securities
shall be delivered by the relevant Pledgor to the Agent or any bailee
of the Agent duly endorsed in blank for transfer or accompanied by an
appropriate assignment or assignments or an appropriate undated stock
power or powers, in every case sufficient to transfer title thereto.
Each Pledgor acknowledges and agrees that National City Bank,
Cleveland, Ohio ("NatCity") currently acts and shall continue to act as
the Agent's bailee until such time as NatCity delivers the Pledged
Securities and such stock powers to the Agent or any other bailee of
the Agent. The Agent may at any time after the occurrence of an Event
of Default cause to be transferred into its name or into the name of
its nominee or nominees any and all of the Pledged Securities. The
Agent shall at all times have the right to exchange the certificates
representing the Pledged Securities for certificates of smaller or
larger denominations.
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(c) The Pledged Securities have been validly issued and are
fully paid and non-assessable. There are no outstanding commitments or
other obligations of the issuers of any of the Pledged Securities to
issue, and no options, warrants or other rights of any individual or
entity to acquire, any share of any class or series of capital stock of
such issuers. The Pledged Securities listed and described on Schedule A
attached hereto and delivered concurrently herewith to NatCity as the
Agent's bailee constitute the percentage of the issued and outstanding
capital stock of each series and class of the issuers thereof as set
forth thereon owned by the relevant Pledgor. Each Pledgor further
agrees that in the event any such issuer shall issue any additional
capital stock of any series or class (whether or not entitled to vote)
to such Pledgor or otherwise on account of its ownership interest
therein, each Pledgor will forthwith pledge and deposit hereunder, or
cause to be pledged and deposited hereunder, all such additional shares
of such capital stock.
Section 6. Special Provisions Re: Partnership Interest
Collateral.
(a) Each Pledgor further warrants to and agrees with the
Agent and the Secured Creditors as follows:
(i) that said Partnerships are valid and existing
entities of the type listed on Schedule B and are duly
organized and existing under applicable law;
(ii) that the Partnership Interest Collateral listed
and described on Schedule B attached hereto constitutes the
percentage of the equity interest in each Partnership set
forth thereon owned by the relevant Pledgor;
(iii) that the copies of the partnership agreements
(each such agreement being hereinafter referred to as
"Organizational Agreement") for the Partnerships heretofore
delivered to the Agent are true and correct copies thereof and
have not been amended or modified in any respect, except for
such amendments or modifications as are attached to the copies
thereof delivered to the Agent; and
(iv) that the Partnerships have no loans outstanding
to the Pledgors, and no Pledgor will borrow money from the
Partnerships.
(b) The Pledgors shall not, without the prior written consent
of the Agent, consent to any amendment or modification to any of the
Organizational Agreements which would in any manner adversely affect or
impair the Partnership Interest Collateral or reduce or dilute the
rights of the Pledgor with respect to any of the Partnerships, any of
such done without such prior written consent to be null and void. The
Pledgors shall promptly send to the Agent copies of all notices and
communications with respect to each
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Partnership alleging the existence of a default by an Pledgor in the
performance of any of its obligations under any Organizational
Agreement. Each Pledgor agrees that it will promptly notify the Agent
of any litigation which might adversely affect such Pledgor or a
Partnership or any of their respective properties and of any material
adverse change in the operations, business properties, assets or
conditions, financial or otherwise, of any Pledgor or any Partnership.
Each Pledgor shall promptly perform all of its obligations under each
Organizational Agreement. In the event any Pledgor fails to pay or
perform any obligation arising under any Organizational Agreement or
otherwise related to any Partnership, the Agent may, but need not, pay
or perform such obligation at the expense and for the account of the
Pledgors and all funds expended for such purposes shall constitute
Obligations secured hereby which the Pledgors promise to pay to the
Agent together with interest thereon at the Default Rate.
Section 7. Voting Rights and Dividends. Unless and until an Event
of Default hereunder has occurred and thereafter until notified by the Agent
pursuant to Section 9(b) hereof:
(a) Each Pledgor shall be entitled to exercise all voting
and/or consensual powers pertaining to the Collateral of such Pledgor,
or any part thereof, for all purposes not inconsistent with the terms
of this Agreement or any other document evidencing or otherwise
relating to any of the Obligations.
(b) Each Pledgor shall be entitled to receive and retain all
dividends and distributions in respect of the Collateral which are paid
in cash of whatsoever nature; provided, however, that such dividends
and distributions representing:
(i) stock or liquidating dividends or a distribution
or return of capital upon or in respect of the Pledged
Securities or any part thereof or resulting from a split-up,
revision or reclassification of the Pledged Securities or any
part thereof or received in addition to, in substitution of or
in exchange for the Pledged Securities or any part thereof as
a result of a merger, consolidation or otherwise, or
(ii) distributions in complete or partial liquidation
of any Partnership or the interest of such Pledgor therein,
in each case, shall be paid, delivered or transferred, as appropriate,
directly to the Agent immediately upon the receipt thereof by such
Pledgor and shall, in the case of cash, be applied by the Agent to the
satisfaction of Obligations in accordance with the provisions of
Section 10 hereof, whether or not the same may then be due or otherwise
adequately secured and shall, in the case of all other property,
together with any cash received by the
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Agent and not applied as aforesaid, be held by the Agent pursuant
hereto as part of the Pledged Securities as additional Pledged
Securities pledged under and subject to the terms of this Agreement; or
(c) In order to permit each Pledgor to exercise such voting
and/or consensual powers which it is entitled to exercise under
subsection (a) above and to receive such distributions which such
Pledgor is entitled to receive and retain under subsection (b) above,
the Agent will, if necessary, upon the written request of such Pledgor,
from time to time execute and deliver to such Pledgor appropriate
proxies and dividend orders.
Section 8. Power of Attorney. Each Pledgor hereby appoints the
Agent, and each of its nominees, officers, agents, attorneys, and any other
person whom the Agent may designate, as such Pledgor's attorney-in-fact, with
full power and authority to ask, demand, collect, receive, receipt for, ▇▇▇ for,
compound and give acquittance for any and all sums or properties which may be or
become due, payable or distributable in respect of the Collateral or any part
thereof, with full power to settle, adjust or compromise any claim thereunder or
therefor as fully as such Pledgor could itself do, to endorse or sign the
Pledgor's name on any assignments, stock powers, or other instruments of
transfer and on any checks, notes, acceptances, money orders, drafts, and any
other forms of payment or security that may come into the Agent's possession and
on all documents of satisfaction, discharge or receipt required or requested in
connection therewith, and, in its discretion, to file any claim or take any
other action or proceeding, either in its own name or in the name of such
Pledgor, or otherwise, which the Agent may deem necessary or appropriate to
collect or otherwise realize upon all or any part of the Collateral, or effect a
transfer thereof, or which may be necessary or appropriate to protect and
preserve the right, title and interest of the Agent in and to such Collateral
and the security intended to be afforded hereby. Each Pledgor hereby ratifies
and approves all acts of any such attorney and agrees that neither the Agent nor
any such attorney will be liable for any such acts or omissions nor for any
error of judgment or mistake of fact or law other than such person's gross
negligence or willful misconduct. The Agent may file one or more financing
statements disclosing its security interest in all or any part of the Collateral
without any Pledgor's signature appearing thereon, and each Pledgor also hereby
grants the Agent a power of attorney to execute any such financing statements,
and any amendments or supplements thereto, on behalf of such Pledgor without
notice thereof to such Pledgor. The foregoing powers of attorney, being coupled
with an interest, are irrevocable until the Obligations have been fully
satisfied and any commitment of the Secured Creditors to extend credit
constituting Obligations to the Company has terminated; provided, however, that
the Agent agrees, as a personal covenant to the relevant Pledgor, not to
exercise the powers of attorney set forth in this Section unless an Event of
Default exists.
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Section 9. Defaults and Remedies. (a) The occurrence of any event or
the existence of any condition which is specified as an "Event of Default" under
the Credit Agreement shall constitute an "Event of Default" hereunder.
(b) Upon the occurrence of any Event of Default, all rights of the
Pledgors to receive and retain the distributions which they are entitled to
receive and retain pursuant to Section 7(b) hereof shall, at the option of the
Agent cease and thereupon become vested in the Agent which, in addition to all
other rights provided herein or by law, shall then be entitled solely and
exclusively to receive and retain the distributions which the Pledgors would
otherwise have been authorized to retain pursuant to Section 7(b) hereof and all
rights of the Pledgors to exercise the voting and/or consensual powers which
they are entitled to exercise pursuant to Section 7(a) hereof shall, at the
option of the Agent, cease and thereupon become vested in the Agent which, in
addition to all other rights provided herein or by law, shall then be entitled
solely and exclusively to exercise all voting and other consensual powers
pertaining to the Collateral and to exercise any and all rights of conversion,
exchange or subscription and any other rights, privileges or options pertaining
thereto as if the Agent were the absolute owner thereof including, without
limitation, the right to exchange, at its discretion, the Collateral or any part
thereof upon the merger, consolidation, reorganization, recapitalization or
other readjustment of the respective issuer thereof or upon the exercise by or
on behalf of any such issuer or the Agent of any right, privilege or option
pertaining to the Collateral or any part thereof and, in connection therewith,
to deposit and deliver the Collateral or any part thereof with any committee,
depositary, transfer agent, registrar or other designated agency upon such terms
and conditions as the Agent may determine. In the event the Agent in good faith
believes any of the Collateral constitutes restricted securities within the
meaning of any applicable securities law, any disposition thereof in compliance
with such laws shall not render the disposition commercially unreasonable.
(c) Upon the occurrence of any Event of Default, the Agent shall
have, in addition to all other rights provided herein or by law, the rights and
remedies of a secured party under the UCC (regardless of whether the UCC is the
law of the jurisdiction where the rights or remedies are asserted and regardless
of whether the UCC applies to the affected Collateral), and further the Agent
may, without demand and without advertisement, notice, hearing or process of
law, all of which each Pledgor hereby waives to the extent permitted by law, at
any time or times, sell and deliver any or all of the Collateral held by or for
it at public or private sale, at any securities exchange or broker's board or at
any of the Agent's offices or elsewhere, for cash, upon credit or otherwise, at
such prices and upon such terms as the Agent deems advisable, in its sole
discretion. In the exercise of any such remedies, the Agent may sell the
Collateral as a unit even though the sales price thereof may be in excess of the
amount remaining unpaid on the Obligations. Also, if less than all the
Collateral is sold, the Agent shall have no duty to marshal or apportion the
part of the Collateral so sold as between the Pledgors, or any of them, but may
sell and deliver any or all of the Collateral without regard to which of the
Pledgors are the
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owners thereof. In addition to all other sums due the Agent or any Secured
Creditor hereunder, each Pledgor shall pay the Agent and the Secured Creditors
all costs and expenses incurred by the Agent and such Secured Creditors,
including reasonable attorneys' fees and court costs, in obtaining, liquidating
or enforcing payment of Collateral or the Obligations or in the prosecution or
defense of any action or proceeding by or against the Agent, such Secured
Creditors or any Pledgor concerning any matter arising out of or connected with
this Agreement or the Collateral or the Obligations including, without
limitation, any of the foregoing arising in, arising under or related to a case
under the United States Bankruptcy Code (or any successor statute). Any
requirement of reasonable notice shall be met if such notice is personally
served on or mailed, postage prepaid, to the Pledgors in accordance with Section
14(b) hereof at least ten days before the time of sale or other event giving
rise to the requirement of such notice; provided, however, no notification need
be given to a Pledgor if such Pledgor has signed, after an Event of Default has
occurred, a statement renouncing any right to notification of sale or other
intended disposition. The Agent shall not be obligated to make any sale or other
disposition of the Collateral regardless of notice having been given. The Agent
or any Secured Creditor may be the purchaser at any sale or other disposition of
the Collateral or any part thereof. Each Pledgor hereby waives all of its rights
of redemption from any sale or other disposition of the Collateral or any part
thereof. The Agent may postpone or cause the postponement of the sale of all or
any portion of the Collateral by announcement at the time and place of such
sale, and such sale may, without further notice, be made at the time and place
to which the sale was postponed or the Agent may further postpone such sale by
announcement made at such time and place.
EACH PLEDGOR AGREES THAT IF ANY PART OF THE COLLATERAL IS SOLD AT ANY
PUBLIC OR PRIVATE SALE, THE AGENT MAY ELECT TO SELL ONLY TO A BUYER WHO WILL
GIVE FURTHER ASSURANCES, SATISFACTORY IN FORM AND SUBSTANCE TO THE AGENT,
RESPECTING COMPLIANCE WITH THE REQUIREMENTS OF THE FEDERAL SECURITIES ACT OF
1933, AS AMENDED, AND A SALE SUBJECT TO SUCH CONDITION SHALL BE DEEMED
COMMERCIALLY REASONABLE.
EACH PLEDGOR FURTHER AGREES THAT IN ANY SALE OF ANY PART OF THE
COLLATERAL, THE AGENT IS HEREBY AUTHORIZED TO COMPLY WITH ANY LIMITATION OR
RESTRICTION IN CONNECTION WITH SUCH SALE AS IT MAY BE ADVISED BY COUNSEL IS
NECESSARY IN ORDER TO AVOID ANY VIOLATION OF APPLICABLE LAW (INCLUDING, WITHOUT
LIMITATION, COMPLIANCE WITH SUCH PROCEDURES AS MAY RESTRICT THE NUMBER OF
PROSPECTIVE BIDDERS AND PURCHASERS AND/OR FURTHER RESTRICT SUCH PROSPECTIVE
BIDDERS OR PURCHASERS TO PERSONS WHO WILL REPRESENT AND AGREE THAT THEY ARE
PURCHASING FOR THEIR OWN ACCOUNT FOR INVESTMENT AND NOT WITH A VIEW TO THE
DISTRIBUTION OR RESALE OF SUCH COLLATERAL ), OR IN ORDER TO OBTAIN ANY REQUIRED
APPROVAL OF THE SALE OR OF THE PURCHASER BY ANY GOVERNMENTAL REGULATORY
AUTHORITY OR OFFICIAL, AND EACH PLEDGOR FURTHER AGREES THAT SUCH COMPLIANCE
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SHALL NOT RESULT IN SUCH SALE BEING CONSIDERED OR DEEMED NOT TO HAVE BEEN MADE
IN A COMMERCIALLY REASONABLE MANNER, NOR SHALL THE AGENT BE LIABLE OR
ACCOUNTABLE TO ANY PLEDGOR FOR ANY DISCOUNT ALLOWED BY REASON OF THE FACT THAT
SUCH COLLATERAL IS SOLD IN COMPLIANCE WITH ANY SUCH LIMITATION OR RESTRICTION.
(d) In the event the Agent shall sell any part of the Partnership
Interest Collateral at a foreclosure sale, each Pledgor hereby grants the
purchaser of such portion of the Partnership Interest Collateral to the fullest
extent of its capacity, the ability (but not the obligation) to become a partner
in the relevant Partnership (subject to the approval of the general partner of
the relevant Partnership, in the exercise of its sole discretion), in the place
and stead of such Pledgor. To exercise such right, the purchaser shall give
written notice to the relevant Partnership of its election to become a partner
in such Partnership. Following such election and giving of consent by all
necessary partners of the relevant Partnership as to the purchaser becoming a
partner, the purchaser shall have the right and powers and be subject to the
liabilities of a partner under the relevant Organizational Agreement and the
partnership act governing the Partnership.
(e) Upon the occurrence and during the continuation of any Event of
Default, in addition to all other rights provided herein or by law, the Agent
shall have the right to cause all or any part of the Partnership Interest
Collateral of any of the Pledgors in any one or more of the Partnerships to be
redeemed and to cause a withdrawal, in whole or in part, of any Pledgor from any
Partnership or any of its Partnership Interest Collateral therein.
(f) The powers conferred upon the Agent hereunder are solely to
protect its interest in the Collateral and shall not impose on it any duties to
exercise such powers. The Agent shall be deemed to have exercised reasonable
care in the custody and preservation of the Collateral in its possession if the
Collateral is accorded treatment substantially equivalent to that which the
Agent accords its own property, consisting of similar types securities, it being
understood, however, that the Agent shall have no responsibility for (i)
ascertaining or taking any action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relating to any Collateral, whether or not
the Agent has or is deemed to have knowledge of such matters, (ii) taking any
necessary steps to preserve rights against any parties with respect to any
Collateral, or (iii) initiating any action to protect the Collateral or any part
thereof against the possibility of a decline in market value. This Agreement
constitutes an assignment of rights only and not an assignment of any duties or
obligations of the Pledgors in any way related to the Collateral, and the Agent
shall have no duty or obligation to discharge any such duty or obligation. By
its acceptance hereof, the Agent does not undertake to perform or discharge and
shall not be responsible or liable for the performance or discharge of any such
duties or responsibilities and shall not in any event become a "Substituted
Limited Partner" or words of like import (as defined in the relevant
Organizational Agreement) in the relevant Partnership. Neither the Agent or any
Secured Creditor, nor any party acting as attorney for the Agent or any Secured
Creditor,
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shall be liable hereunder for any acts or omissions or for any error of judgment
or mistake of fact or law other than such person's gross negligence or willful
misconduct.
(g) Failure by the Agent to exercise any right, remedy or option
under this Agreement or any other agreement between any Pledgor and the Agent or
provided by law, or delay by the Agent in exercising the same, shall not operate
as a waiver; and no waiver shall be effective unless it is in writing, signed by
the party against whom such waiver is sought to be enforced and then only to the
extent specifically stated. The rights and remedies of the Agent and the Secured
Creditors under this Agreement shall be cumulative and not exclusive of any
other right or remedy which the Agent or the Secured Creditors may have. For
purposes of this Agreement, an Event of Default shall be construed as continuing
after its occurrence until the same is waived in writing by the Lenders or the
Required Lenders, as the case may be, in accordance with the Credit Agreement.
Section 10. Application of Proceeds. The proceeds and avails of
the Collateral at any time received by the Agent during the existence of any
Event of Default shall, when received by the Agent in cash or its equivalent, be
applied by the Agent in reduction of, or as collateral security for, the
Obligations in accordance with the terms of the Credit Agreement. The Pledgors
shall remain liable to the Agent and the Secured Creditors for any deficiency.
Any surplus remaining after the full payment and satisfaction of the Obligations
shall be returned to the Pledgors, or to whomsoever the Agent reasonably
determines is lawfully entitled thereto.
Section 11. Continuing Agreement. This Agreement shall be a
continuing agreement in every respect and shall remain in full force and effect
until all of the Obligations, both for principal and interest, have been fully
paid and satisfied and any commitment to extend constituting Obligations to and
of the Company shall have terminated. Upon such termination of this Agreement,
the Agent shall, upon the request and at the expense of the Pledgors, forthwith
release all its liens and security interests hereunder.
Section 12. Primary Security; Obligations Absolute. The lien and
security herein created and provided for stand as direct and primary security
for the Obligations. No application of any sums received by the Agent in respect
of the Collateral or any disposition thereof to the reduction of the Obligations
or any portion thereof shall in any manner entitle any Pledgor to any right,
title or interest in or to the Obligations or any collateral security therefor,
whether by subrogation or otherwise, unless and until all Obligations have been
fully paid and satisfied and any commitments to extend credit constituting
Obligations to the Company shall have terminated. Each Pledgor acknowledges and
agrees that the lien and security hereby created and provided for are absolute
and unconditional and shall not in any manner be affected or impaired by any
acts or omissions whatsoever of the Agent, any Secured Creditor or any other
holder of any of the Obligations, and without limiting the generality of the
foregoing, the lien and security
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hereof shall not be impaired by any acceptance by the Agent, any Secured
Creditor or any other holder of any of the Obligations of any other security for
or guarantors upon any Obligations or by any failure, neglect or omission on the
part of the Agent, any Secured Creditor or any other holder of any of the
Obligations to realize upon or protect any of the Obligations or any collateral
security therefor. The lien and security hereof shall not in any manner be
impaired or affected by (and the Agent and the Secured Creditors, without notice
to anyone, are hereby authorized to make from time to time) any sale, pledge,
surrender, compromise, settlement, release, renewal, extension, indulgence,
alteration, substitution, exchange, change in, modification or disposition of
any of the Obligations, or of any collateral security therefor, or of any
guaranty thereof, or of any instrument or agreement setting forth the terms and
conditions pertaining to any of the foregoing. The Secured Creditors may at
their discretion at any time grant credit to the Company without notice to any
Pledgor in such amounts and on such terms as the Secured Creditors may elect
without in any manner impairing the lien and security hereby created and
provided for. In order to realize hereon and to exercise the rights granted the
Agent hereunder and under applicable law as against any Pledgor or any portion
of the Collateral in which any such Pledgor has rights, there shall be no
obligation on the part of the Agent, any Secured Creditor or any other holder of
any of the Obligations at any time to first resort for payment to the Company or
any other Pledgor or any other Person, its property or estate or to any guaranty
of the Obligations or any portion thereof or to resort to any other collateral
security, property, liens or any other rights or remedies whatsoever, and the
Agent shall have the right to enforce this Agreement as against any Pledgor or
any portion of the Collateral in which any such Pledgor has rights, irrespective
of whether or not other proceedings or steps are pending seeking resort to or
realization upon or from any of the foregoing.
Section 13. The Agent. In acting under or by virtue of this
Agreement, Agent shall be entitled to all the rights, authority, privileges and
immunities provided in Section 10 of the Credit Agreement, all of which
provisions of said Section 10 are incorporated by reference herein with the same
force and effect as if set forth herein in their entirety. The Agent hereby
disclaims any representation or warranty to the Secured Creditors or any other
holders of the Obligations concerning the perfection of the liens and security
interests granted hereunder or in the value of the Collateral.
Section 14. Miscellaneous. (a) This Agreement cannot be changed or
terminated orally. This Agreement shall create a continuing lien on and security
interest in the Collateral and shall be binding upon each Pledgor, its
successors and assigns, and shall inure, together with the rights and remedies
of the Agent and the Secured Creditors hereunder, to the benefit of the Agent
and the Secured Creditors, and their successors and assigns; provided, however,
that no Pledgor may assign its rights or delegate its duties hereunder without
the Agent's prior written consent. Without limiting the generality of the
foregoing, and subject to the provisions of the Credit Agreement, any Secured
Creditor may assign or otherwise transfer any indebtedness held
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by it secured by this Agreement to any other person, and such other person shall
thereupon become vested with all the benefits in respect thereof granted to such
Secured Creditor herein or otherwise.
(b) All communications provided for herein shall be in writing,
except as otherwise specifically provided for hereinabove, and shall be deemed
to have been given or made, if to any Pledgor when given to the Company in
accordance with Section 12.8 of the Credit Agreement, or if to the Agent or any
Lender, when given to such party in accordance with Section 12.8 of the Credit
Agreement.
(c) No Secured Creditor shall have the right to institute any suit,
action or proceeding in equity or at law for the foreclosure or other
realization upon any Collateral subject to this Agreement or for the execution
of any trust or power hereof or for the appointment of a receiver, or for the
enforcement of any other remedy under or upon this Agreement; it being
understood and intended that no one or more of the Secured Creditors shall have
any right in any manner whatsoever to affect, disturb or prejudice the lien and
security interest of this Agreement by its or their action or to enforce any
right hereunder, and that all proceedings at law or in equity shall be
instituted, had and maintained by the Agent in the manner herein provided for
the benefit of the Secured Creditors.
(d) In the event that any provision hereof shall be deemed to be
invalid by reason of the operation of any law or by reason of the interpretation
placed thereon by any court, this Agreement shall be construed as not containing
such provision, but only as to such locations where such law or interpretation
is operative, and the invalidity of such provision shall not affect the validity
of any remaining provision hereof, and any and all other provisions hereof which
are otherwise lawful and valid shall remain in full force and effect. Without
limiting the generality of the foregoing, in the event that this Agreement shall
be deemed to be invalid or otherwise unenforceable with respect to any Pledgor,
such invalidity or unenforceability shall not affect the validity of this
Agreement with respect to the other Pledgors.
(e) This Agreement shall be deemed to have been made in the State of
Illinois and shall be governed by, and construed in accordance with, the laws of
the State of Illinois. All terms which are used in this Agreement which are
defined in the UCC shall have the same meanings herein as said terms do in the
UCC unless this Agreement shall otherwise specifically provide. The headings in
this Agreement are for convenience of reference only and shall not limit or
otherwise affect the meaning of any provision hereof.
(f) This Agreement may be executed in any number of counterparts and
by different parties hereto on separate counterpart signature pages, each
constituting an original, but all together one and the same instrument. Each
Pledgor acknowledges that this Agreement is and
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shall be effective upon its execution and delivery by such Pledgor to the Agent,
and it shall not be necessary for the Agent to execute this Agreement or any
other acceptance hereof or otherwise to signify or express its acceptance
hereof.
(g) In the event the Agent (with the consent of the requisite
Lenders) shall at any time in their discretion permit a substitution of Pledgors
hereunder or a party shall wish to become a Pledgor hereunder, such substituted
or additional Pledgor shall, upon executing an agreement in the form attached
hereto as Schedule E, become a party hereto and be bound by all the terms and
conditions hereof to the same extent as though such Pledgor had originally
executed this Agreement and, in the case of a substitution, in lieu of the
Pledgor being replaced. No such substitution shall be effective absent the
written consent of the Agent and the requisite Lenders nor shall it in any
manner affect the obligations of the other Pledgors hereunder.
(h) THE AGENT AND THE PLEDGORS AGREE THAT ALL DISPUTES AMONG THEM
ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP
ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT, AND WHETHER ARISING IN
CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED ONLY BY STATE OR FEDERAL
COURTS LOCATED IN ▇▇▇▇ COUNTY, ILLINOIS, BUT EACH OF THE AGENT AND THE PLEDGORS
ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT
LOCATED OUTSIDE OF ▇▇▇▇ COUNTY, ILLINOIS. EACH OF THE PLEDGORS WAIVES IN ALL
DISPUTES ANY OBJECTION THAT SUCH PLEDGOR MAY HAVE TO THE LOCATION OF THE COURT
CONSIDERING THE DISPUTE OR ANY OBJECTION THAT SUCH PLEDGOR MAY HAVE THAT ANY
OTHER PARTY HAS NOT BEEN JOINED IN SUCH PROCEEDING. EACH OF THE PLEDGORS AGREES
THAT THE AGENT SHALL HAVE THE RIGHT TO PROCEED AGAINST EACH AND ANY OF THE
PLEDGORS OR THEIR COLLATERAL IN A COURT IN ANY LOCATION TO ENABLE THE AGENT TO
REALIZE ON THE COLLATERAL, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER ENTERED
IN FAVOR OF THE AGENT, WHETHER OR NOT PROCEEDING SEPARATELY AGAINST ANY PLEDGOR
AND ITS PROPERTY OR JOINTLY AGAINST THE COMPANY AND ANY ONE OR MORE OF THE
PLEDGORS AND THEIR PROPERTY. EACH OF THE PLEDGORS WAIVES ANY OBJECTION THAT IT
MAY HAVE TO THE LOCATION OF THE COURT IN WHICH THE AGENT HAS COMMENCED A
PROCEEDING DESCRIBED IN THIS PARAGRAPH.
[SIGNATURE PAGES TO FOLLOW]
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IN WITNESS WHEREOF, each Pledgor has caused this Agreement to be duly
executed and delivered as of the date first above written.
PLEDGORS:
▇▇▇▇▇▇ INDUSTRIAL GROUP, INC.
By
Its
----------------------------------
▇▇▇▇▇▇ METALCRAFT CO.
By
Its
----------------------------------
▇▇▇▇▇▇ METALCRAFT CO. OF NORTH CAROLINA
By
Its
----------------------------------
▇▇▇▇▇▇ METALCRAFT CO. OF SOUTH CAROLINA
By
Its
----------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, INC.
By
Its
----------------------------------
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B&W METAL FABRICATORS, INC.
By
Its
----------------------------------
Acknowledged and agreed to as of the date first above written.
▇▇▇▇▇▇ TRUST AND SAVINGS BANK, as Agent
By
Its:
-----------------------------------
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