Exhibit 99.6
PLEDGE AND SECURITY AGREEMENT
Security Agreement Pursuant to CCF Agreement
October 30, 1998
THIS PLEDGE AND SECURITY AGREEMENT ("Agreement") is made, executed and
consummated effectively this 30th day of October, 1998 ("Effective Date"), by
and among 1) COMPOST AMERICA HOLDING COMPANY, INC. ("Compost"), MIAMI RECYCLING
AND COMPOSTING CO., INC. ("Miami") and BEDMINSTER SEACOR SERVICES MIAMI
CORPORATION ("Bedminster"); and, 2) LIONHART GLOBAL APPRECIATION FUND, LTD.
("Lionhart"), LIONHART INVESTMENTS, LTD. ("LHI") and GLOBAL EARTHFUND PARTNERS,
L.L.C. ("GEP") (Lionhart, LHI and GEP are sometimes collectively referred to
herein as the "Secured Party(ies)").
Recitals:
1. Compost is a New Jersey corporation. The principal office of Compost
is located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇.
2. Miami is a Delaware corporation. The principal office of Miami is
located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇. Bedminster is a
Florida corporation. The principal office of Bedminster is located at ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇. Compost is the direct parent of Miami, owns
and controls 80.1% of all issued and outstanding capital stock of Miami, and
controls Miami. Miami is the direct parent of Bedminster, Bedminster is a direct
wholly-owned subsidiary of Miami, and Compost controls Bedminster (which is an
indirect controlled subsidiary of Compost).
3. Lionhart is a British Virgin Islands international business company.
The principal office of Lionhart, in the British Virgin Islands, is located at
c/o Citco B.V.I. Limited, Post Office Box 662, Road Town, Tortola, British
Virgin Islands.
4. LHI is a United Kingdom limited liability company. The principal
office of LHI, in the United Kingdom, is located at ▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ 4 RH, England. As of the Effective Date of this
Agreement, LHI is engaged by Lionhart as its investment advisor.
5. GEP is an Indiana limited liability company. The principal office of
GEP in the United States is c/o ▇▇▇▇ ▇▇▇▇▇▇ Drics, Esq., ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇. As of the Effective Date of this
Mortgage, Lionhart is the direct parent of GEP, and GEP is a direct wholly-owned
subsidiary of Lionhart.
6. On and effective as of October 30, 1998, Compost, Miami, Bedminster,
Lionhart, LHI and GEP entered into, executed, consummated and delivered an
agreement, entitled "Credit, Capitalization and Financing Agreement" ("CCF
Agreement"), which is hereby incorporated by reference. Except as otherwise
defined separately in this Agreement, and/or except as otherwise indicated by
the context in this Agreement, any terms that are capitalized in this Agreement
shall have the same definition and meaning as is ascribed to such terms in the
CCF Agreement (and/or in any Credit Document(s) or Supplemental Definitive
Document(s) (as those terms are defined under the CCF Agreement)). This
Agreement is the same instrument, agreement and document that is referred to,
and as is otherwise defined as, the Security Agreement, under and pursuant to
the CCF Agreement.
7. Pursuant to the terms and subject to the conditions set forth in the
CCF Agreement, the Credit Documents and the Definitive Supplemental Documents,
Compost, Miami and/or Bedminster have the affirmative duty and obligation, inter
alia, to and for the benefit of Lionhart, LHI and/or GEP, 1) to pay and
discharge timely punctually, completely and fully certain Indebtedness (as that
term is defined under Section 18.01.01 of the CCF Agreement) and 2) to perform
and discharge timely, punctually, completely and fully certain Obligations (as
that term is defined under Section 18.01.02 of the CCF Agreement). For purposes
of this Agreement, the terms "Indebtedness" and "Obligations" shall have the
same meanings and definitions as ascribed respectively to such terms under
Section 18.01.01 and Section 18.01.02 of the CCF Agreement.
8. Compost, Miami and Bedminster, 1) for and in consideration of (i)
the delivery by Lionhart, LHI and GEP to Compost, Miami and Bedminster of the
Credit (as defined under Section 2.1 of the CCF Agreement) and (ii) the
execution, delivery or consummation of the agreements, promises, covenants and
other undertakings by Lionhart, LHI and/or GEP as otherwise provided under the
CCF Agreement, the Credit Documents and/or the Supplemental Definitive Documents
("Consideration"), and 2) as an inducement to Lionhart, LHI and GEP to enter
into, agree, execute and deliver, and otherwise
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consummate the transactions contemplated under, the CCF Agreement, the Credit
Documents and the Supplemental Definitive Documents, and, 3) to additionally
secure (to and for the benefit of Lionhart, LHI and GEP) the timely and complete
payment of the Indebtedness and the performance and discharge of the
Obligations, by and on the part of Compost, Miami and Bedminster, under and
pursuant the CCF Agreement, the Credit Documents and/or the Definitive
Supplemental Documents, Compost, Miami and Bedminster have agreed to execute or
deliver (at the Term Loan Closing on the Closing Date), or cause to be executed
and delivered (on the Term Loan Closing on the Closing Date), to and for the
benefit of Lionhart, LHI and GEP, this Agreement, without the delivery of which
Lionhart, LHI and GEP would not exchange, execute or otherwise deliver the
Consideration to or for the benefit of Compost, Miami and/or Bedminster.
NOW, THEREFORE, for good and valuable consideration, the receipt and
legal adequacy of which are hereby acknowledged, and as part of the
consideration of Compost and Miami for the Consideration of Lionhart, LHI and
GEP, as otherwise provided under the CCF Agreement, the Credit Documents and the
Definitive Supplemental Documents, Compost, Miami and Bedminster hereby promise,
covenant, and represent and warrant to Lionhart, LHI and GEP, and hereby agree
with Lionhart, LHI and GEP, as follows:
Agreement:
Section 1. Security Interest/Collateral. Compost, Miami and Bedminster,
jointly and severally, and in consideration of and as an inducement for the
Consideration specified in this Agreement, and to secure the timely, punctual,
complete and full payment and discharge of the Indebtedness and the timely,
punctual, complete and full performance and discharge of the Obligations, by and
on the part of Compost, Miami and Bedminster, under and pursuant to this
Agreement, the CCF Agreement, the Credit Documents and the Definitive
Supplemental Documents, hereby grant, bargain, release, convey, warrant, sell,
assign, transfer, set over, pledge, confirm and deliver unto Lionhart, LHI and
GEP, and all of their respective successors and assigns, a security interest in
all of the following property of Compost, Miami and/or Bedminster, now owned or
hereafter acquired or arising, including all cash and non-cash proceeds of the
foregoing ("Collateral"), as follows:
1.01. Exhibit A. All personal property (including licenses,
permits and agreements), that is owned by all or any of Compost, Miami
and/or Bedminster, that is set forth or otherwise identified in Exhibit
A that is attached to this Agreement; and,
1.02. Miami Project Collateral. The "Miami Project Collateral," as
defined under Section 1.1.92 of the CCF Agreement (and to the extent
that any such "Miami Project Collateral" is classified as personal
property and is otherwise subject to Article 9 of the Uniform
Commercial Code of and as adopted by the State of New Jersey), and
which includes the following:
(a) Miami Project Permits. Any and all Miami Project Permits,
as that term is defined under Section 11.26.01 of the CCF
Agreement, including the Current Permits and the Supplemental
Prospective Permits, as those terms are defined respectively under
Section 11.26.01(b)(1) and Section 11.26.01(b((2) of the CCF
Agreement; and,
(b) Miami Claim. Any all claims of Compost, Miami and/or
Bedminster against the Miami, Dade County, Florida ("City of
Miami"), that relate to or arise from the Put or Pay Contract
and/or the Miami Project (as those terms are defined respectively
under Section 11.26.01(a) and Section 11.26.01(e) of the CCF
Agreement, and as otherwise contemplated under Section 11.26.01(j)
of the CCF Agreement), whether or not asserted in, but including,
without limitation, all such claims that are set forth in the
Miami Complaint (as that term is defined under Section 11.26.01(j)
of the CCF Agreement; and,
(c) Put or Pay Contract. All right, title and interest,
including claims, of Compost, Miami and/or Bedminster that relate
to or arise from (i) The "Solid Waste Service Agreement," dated as
of October 29, 1993, by and between the City of Miami, Florida,
and Bedminster Seacor Services Miami Corporation ("Solid Waste
Service Agreement"), a copy of which is set forth in Appendix
II-Item 4 of the CCF Agreement, and which is hereby incorporated
by reference, (ii) "Amendment One to the Solid Waste Service
Agreement," dated October 20, 1994, by and between the City of
Miami, Florida, and Bedminster Seacor Services Miami Corporation
("First Amendment"), a copy of which is set forth in Appendix
II-Item 5 of the
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CCF Agreement, and which is hereby incorporated by reference, (ii)
the "Restated Compost Recycling Agreement," dated as of November
30, 1995, by and between the City of Miami, Florida, and
Bedminster Seacor Services Miami Corporation ("Restated Compost
Recycling Agreement"), a copy of which is set forth in Appendix
II-Item 6 of the CCF Agreement, and which is hereby incorporated
by reference, (iv) the "Amendment to the Restated Compost
Recycling Agreement," dated and executed as of April 17, 1998, by
and between the City of Miami, Florida, and Bedminster Seacor
Services Miami Corporation ("Second Amendment"), a copy of which
is set forth in Appendix II-Item 7 of the CCF Agreement, and which
is hereby incorporated by reference, and (v) all amendments,
additions, modifications, substitutions, replacements, extensions
and additions thereof, including, without limitation, all cash and
non-cash proceeds thereof; and,
(d) Miami/Bedminster Balance Sheet Properties. All
Properties, and all other assets that are owned by Miami and/or
Bedminster, that are set forth in the Miami Balance Sheet and/or
the Bedminster Balance Sheet, as those terms are defined under
Section 11.26.07 of the CCF Agreement, and as is otherwise
disclosed under Schedule 11.26.07-1 and Schedule 11.26.07-2 of the
Disclosure Schedule to the CCF Agreement, and all other Permits
and Material Contracts of Miami and/or Bedminster; and,
(e) Mortgaged Miami Site. Any and all parts of the Mortgaged
Miami Site, as that term is defined under Section 1.01 of the
Mortgage, including, without limitation, any and all Premises,
Improvements, Intangibles, Property Income, Leases, Awards and
Additional Rights (as those terms are defined under Section 1.01
of the GEP Mortgage, including any and all fixtures, and that
constitute personal property and not real property for purposes of
and under the Florida or New Jersey Uniform Commercial Code; and,
(f) Miami Project Financing. Any and all proceeds of the
Miami Project Financing, both cash and non-cash, as that term is
defined under Section 11.26.22 of the CCF Agreement, and as is
otherwise disclosed under Schedule 11.26.22 of the Disclosure
Schedule of the CCF Agreement, and any and all other financings,
whether procured by or for Compost, Miami and/or Bedminster, and
that are intended to be used for the development, construction
and/or permanent financing of the Miami Project (as that term is
defined under Section 11.26.01 of the CCF Agreement), including,
without limitation, all amendments, additions, modifications,
substitutions, replacements, extensions and additions thereof,
including, without limitation, all cash and non-cash proceeds
thereof.
1.03. Miscellaneous. Any and all other current or subsequently or
after-acquired assets and properties of Miami and Bedminster, to the
extent such items are classified as personal property and are of the
type that are subject to a security interest under Article 9 of the
Uniform Commercial Code of and as adopted by the State of New Jersey,
and that are acquired after the Effective Date of this Agreement,
including, without limitation, 1) all machinery and equipment, 2) all
inventory, including without limitation, goods, merchandise and other
personal property held for sale or lease, furnished or to be furnished
under a contract of service, raw materials, work in progress, and
materials used or consumed or to be used or consumed in the business of
Miami and/or Bedminster; 3) all other personal property, including all
goods, documents, instruments, chattel paper and all general
intangibles, intellectual property rights and rights to payment from
every and any source; 4) all contract rights derived from or pertaining
to any of the foregoing Collateral, or otherwise; 5) all accounts
resulting from the sale of any of the foregoing Collateral, or
otherwise; 6) all additions, accessions, accessories, substitutions or
replacements to or of any of the foregoing-described Collateral; 7) all
products and proceeds of any of the foregoing Collateral, including
without limitation, insurance proceeds and proceeds of all warranty and
tort claims, all accounts, contract rights, documents and instruments
arising from the sale or disposition of any such Collateral; 8) all
business records, books and other records relating to or kept by or on
behalf of Miami and/or Bedminster with respect to any of the
foregoing-described Collateral, and the respective business of Miami
and Bedminster; and, 9) all cash and non-cash proceeds relating to or
arising from any of the above-enumerated Collateral, or any disposition
of or that relates to arises from any such Collateral.
Section 2. Inter-Secured Party Agent. The Secured Parties, pursuant to
the terms and subject to the conditions set forth in an agreement, entitled
"Inter-Creditor Agreement," that is dated and was executed by and among the
Secured Parties, on or about October 30, 1998, and that is intended to be
recorded promptly hereafter in the Official Records Book or other Public Records
Page 3 of 13 Pages
of Miami-Dade County, Florida, and any other appropriate public records as may
determined by the Secured Parties, each duly appointed GEP, as the their
exclusive agent and power of attorney ("Agent"), which power is coupled with an
interest, for all Secured Parties, with respect to this Agreement, the CCF
Agreement, the Credit Agreement and the Definitive Supplemental Documents, and
the exercise of the rights and remedies of each Secured Party with respect
thereto. Pursuant to and as provided under the Inter-Creditor Agreement, 1) GEP,
as Agent for all Secured Parties, is authorized and empowered, in their
respective name, place and stead, with full power of substitution, to exercise
and perform from time to time, and without joinder of or by any Secured Party,
any act, power, duty, right or obligation whatsoever that any Secured Party or
the Secured Parties (under this Agreement, the CCF Agreement, the Credit
Documents and/or the Definitive Supplemental Documents) may now or hereafter
exercise or perform, and to deal in all respects with Compost, Miami and
Bedminster with respect to the transactions evidenced under this Agreement, the
CCF Agreement, the Credit Documents and/or the Definitive Supplemental
Documents; and, 2) Compost, Miami and Bedminster, and any third party dealing
with the Agent, under this Agreement, the CCF Agreement, the Credit Documents
and/or the Definitive Supplemental Documents, shall have the right to rely upon
the power and authority of the Agent to bind each Secured Party with respect to
the exercise of remedies or the giving of notices or consents under and pursuant
to this Agreement, the CCF Agreement, the Credit Documents and/or the Definitive
Supplemental Documents.
Section 3. Agreement Purpose and Security. This Agreement is executed
and delivered by Compost, Miami and Bedminster, to Lionhart, LHI and GEP,
pursuant to the terms and subject to the conditions of the CCF Agreement. The
pledge of or security interest in and to the Collateral, as otherwise granted or
pledged under this Agreement, is hereby given by Compost, Miami and Bedminster,
to Lionhart, LHI and GEP, to secure the timely, punctual, complete and full
payment and discharge of the Indebtedness and the timely, punctual, complete and
full performance and discharge of the Obligations, by and on the part of
Compost, Miami and/or Bedminster, under and pursuant to this Agreement, the CCF
Agreement, the Credit Documents and the Definitive Supplemental Documents,
including, without limitation, all such Indebtedness and Obligations that relate
to or arise from the Mortgage Note, and any and all modifications, amendments,
restatements, extensions, renewals, supplements and replacements thereof, as any
of the foregoing may be amended and/or restated form time to time and at any
time, and all costs and expenses incurred or paid or incurred by Lionhart, LHI
and/or GEP to preserve and protect the Collateral and to enforce the security
interests of Lionhart, LHI and/or GEP therein, all of which Compost, Miami and
Bedminster promise and covenant to pay and discharge all such Indebtedness when
due and to perform and discharge all Obligations when due or required to be
performed, without relief from valuation and appraisement laws and with
attorneys' fees. The security interest in the Collateral shall remain, and shall
not be released, unless and until all Indebtedness is paid in full and all
Obligations are performed and discharged in full. Upon the payment in full of
the Indebtedness and the performance in full of all of the Obligations,
Lionhart, LHI and GEP shall take any such commercially reasonable action as may
be requested reasonably by Compost, Miami and/or Bedminster to evidence any such
termination.
Section 4. Release/Waiver. Compost, Miami and Bedminster each hereby
and expressly releases and waives each and every of the following: 1) all
rights, privileges and/or claims under and/or by virtue of any homestead, stay,
appraisement or exemption laws that may now exist or hereinafter be enacted; 2)
all rights, privileges and/or claims to acquire or retain possession, custody or
control of the Collateral, or any part thereof, after any Event of Default (as
otherwise defined under Section 8 of this Agreement) by Compost, Miami and/or
Bedminster, of or with respect to any Indebtedness and/or Obligation, under or
pursuant to this Agreement, the CCF Agreement, the Credit Documents and any
Definitive Supplemental Documents; and, 3) all rights of redemption from the
sale of the Collateral, or any part thereof, under any order or decree of
foreclosure or private sale of and with respect to the Collateral, or any part
thereof.
Section 5. Recital Paragraphs/Incorporation. The Recital Paragraphs
that are set forth on Pages 1-2 of this Agreement, are hereby made part of this
Agreement, as if set forth in their complete terms under this Section 5.
Section 6. General Representations and Warranties. Compost, Miami and
Bedminster, jointly and severally, hereby represent and warrant to Lionhart, LHI
and GEP, and hereby promise and covenant, as follows:
6.01. Collateral.
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(a) Title. Compost, Miami and/or Bedminster, either
individually or aggregately, have or will acquire, and will
maintain full and absolute title in either Compost, Miami and/or
Bedminster to the Collateral, free of all security interests,
liens, pledges and encumbrances other than the pledge or security
interest herein granted to Lionhart, LHI and GEP under this
Agreement, and have good right to pledge and subject the
Collateral to the security interest and pledge granted by and
under this Agreement. Compost, Miami and Bedminster shall have and
will maintain full possession of the Collateral and shall defend
the Collateral against all adverse claims. The Collateral is not
and will not be the subject of any financing statement (other than
any filed by Lionhart, LHI and/or GEP) on file in any public
office or subject to the interest of any person except under this
Agreement or as otherwise set forth on Exhibit B that is attached
hereto and made a part hereof for all purposes.
(b) Condition/Access. Compost, Miami and Bedminster shall
maintain the Collateral in good condition, repair and operating
order (normal wear and tear excepted), and shall not permit it in
any respect to be wasted, destroyed, or used in violation of law.
Upon providing Compost, Miami and/or Bedminster with reasonable
and advance notice, Lionhart, LHI and/or GEP may enter upon any of
Compost's, Miami's and/or Bedminster's property to examine and
inspect the Collateral at any reasonable time or times.
(c) Taxes and Assessments. Compost, Miami and Bedminster
shall promptly pay, as they become due and payable, all taxes and
assessments imposed upon the Collateral or for its use or
operation or upon this Agreement.
(d) Insurance. Compost, Miami and Bedminster shall keep the
Collateral at all times insured against risk of loss or damage by
fire, theft and such other casualties as Lionhart, LHI and/or GEP
may reasonably require, all in such amounts, under such forms of
policies, upon such terms, for such periods and written by such
companies as Lionhart, LHI and/or GEP may reasonably approve. All
such policies of insurance shall be delivered to Lionhart, LHI and
GEP and shall provide that losses will be payable to Lionhart, LHI
and GEP, and Compost, Miami and Bedminster, as their interest may
appear, and that Lionhart, LHI and GEP shall receive at least
thirty (30) days' prior written notice of cancellation. Compost,
Miami and Bedminster shall furnish to Lionhart, LHI and GEP, as
received, the originals of all insurance policies providing such
coverage, including all certificates and endorsements thereof.
(e) Protection of Collateral. Compost, Miami and Bedminster
each shall not, without the prior and advance written consent and
approval of and by Lionhart, LHI and GEP (pursuant to which any
such consent and approval may be granted or withheld in the sole
and exclusive discretion of Lionhart, LHI and GEP), sell, assign,
transfer, or otherwise dispose of any of the Collateral or any of
their respective right, title or interest therein, and shall not
otherwise do or permit anything to be done or occur that may
impair the Collateral as security hereunder.
6.02. Financing Statements, Certificates, Etc. Compost, Miami and
Bedminster shall do such acts as Lionhart, LHI and/or GEP may deem
necessary or appropriate to establish and maintain in Lionhart, LHI
and/or GEP a valid security interest in the Collateral, free of all
other liens and claims not permitted under this Agreement, to secure
full and prompt payment and discharge of the Indebtedness and the full
and prompt performance and discharge of the Obligations. Compost, Miami
and Bedminster each authorizes Lionhart, LHI and/or GEP, at the sole
expense of Compost, Miami and Bedminster, to sign and file, without the
signatures of any Compost, Miami and/or Bedminster, such financing and
continuation statements, amendments and supplements thereto, and other
documents which Lionhart, LHI and/or GEP may from time to time deem
necessary to perfect, preserve and protect their respective security
interests in the Collateral. Compost, Miami and Bedminster each agrees
to execute and deliver to Lionhart, LHI and/or GEP any such financing
statements and documents and to furnish and endorse such other
instruments which Lionhart, LHI and/or GEP may from time to time
request in order to evidence, perfect, preserve and protect their
respective security interest in the Collateral. Compost, Miami and
Bedminster shall from time to time, upon any request by Lionhart, LHI
and/or GEP, deliver to Lionhart, LHI and/or GEP, certified schedules,
in such form as may be specified by Lionhart, LHI and/or GEP,
identifying the Collateral, or such part thereof as may be specified by
Lionhart, LHI and/or GEP, together with such supporting documents and
information as Lionhart, LHI and/or GEP reasonably may request.
6.03. Taxes, Assessments and Expenses.
(a) Taxes and Assessments. Compost, Miami and Bedminster each
agrees to pay promptly when due all
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taxes, assessments and governmental charges upon or against
Compost, Miami and Bedminster, for the property or operations of
Compost, Miami and Bedminster, or otherwise, in each case before
the same become delinquent and before penalties accrue thereon,
unless and to the extent that the same are being contested in good
faith by appropriate proceedings and for which Compost, Miami and
Bedminster have established adequate reserves.
(c) Material Events/Notices. Compost, Miami and Bedminster
shall give written notice to Lionhart, LHI and GEP of all material
occurrences and events adversely affecting the Collateral or the
value or amount thereof.
(b) Secured Party Expenses. In the event that Compost, Miami
and Bedminster fail to pay taxes, assessments, costs and expenses
which Compost, Miami and/or Bedminster is required to pay, or in
the event that Compost, Miami and/or Bedminster fail to keep the
Collateral free from other security interests, liens, pledges, or
encumbrances not permitted under the terms of this Agreement,
Lionhart, LHI and/or GEP may make expenditures for any and all
such purposes. All costs and expenses of Lionhart, LHI and/or GEP
in retaking, holding, preparing for sale and selling or otherwise
realizing upon any Collateral or enforcing any provisions hereof
upon the occurrence of any Event of Default (as defined under
Section 8 of this Agreement) by Compost, Miami and/or Bedminster,
including reasonable attorneys' fees, shall constitute part of the
Indebtedness and Obligations that are otherwise secured under this
Agreement by the Collateral, and Compost, Miami and Bedminster
shall forthwith reimburse Lionhart, LHI and GEP for any such
payments made or any such expenses incurred by Lionhart, LHI
and/or GEP.
Section 7. Performance by Secured Party of Debtor's Agreements.
Lionhart, LHI and/or GEP may, but shall have no duty to, perform any agreement,
promise or covenant of Compost, Miami and/or Bedminster hereunder, which
Compost, Miami and/or Bedminster shall have failed to perform or discharge, and
Compost, Miami and Bedminster shall forthwith reimburse Lionhart, LHI and GEP
for any such payments made or any such expenses incurred by Lionhart, LHI and/or
GEP, including reasonable attorneys' fees, and all such payments, costs and
expenses, including reasonable attorneys' fees, shall constitute part of the
Indebtedness and Obligations that are otherwise secured under this Agreement by
the Collateral.
Section 8. Event of Default. An "Event of Default," under this
Agreement, is and shall be defined as, and shall mean and include, any "Event of
Default" as that term is defined under Section 18.02 (and as otherwise qualified
under Section 18.02.02) of the CCF Agreement, including, without limitation, any
default, breach, violation, failure and/or omission, by or on the part of
Compost, Miami and/or Bedminster, to pay and discharge, on a timely, punctual,
complete and full basis, the Principal and Interest when the Principal and
Interest are or become due and payable under the Mortgage Note.
9. Remedies Upon Default. Upon the occurrence of an Event of Default
(as defined under Section 8 of this Agreement), Lionhart, LHI and GEP shall have
the right, in their sole discretion and option, to exercise all rights and
remedies that are set forth and described under Section 18.04 of the CCF
Agreement, or that Lionhart, LHI and/or GEP may be entitled to assert and/or
claim, at law or in equity, and as follows:
9.01. Acceleration-Indebtedness. Upon the occurrence of any such
Event of Default, Lionhart, LHI and GEP may, from time to time and at
any time(s), declare the entire unpaid amount or portion of any, some
or all of the Indebtedness (including, without limitation, the unpaid
amount or portion of all Principal and Interest under the Mortgage
Note), immediately due and payable, without further notice or demand,
or presentment, protest, notice of protest or notice of dishonor (of
which Compost, Miami and Bedminster hereby expressly waive any such
notice, demand, presentment, protest, notice of protest or notice of
dishonor), whereupon all such Indebtedness, as accelerated under this
Section 9.01, shall become immediately due and payable in full, and
Lionhart, LHI and GEP shall the right immediately to foreclose upon the
lien created by the Mortgage against the Mortgaged Miami Site (as
otherwise defined under the Mortgage); to enforce the security
interests granted under this Agreement, and to use self-help and to
recover, possess, repossess and otherwise dispose of the Collateral,
and to otherwise exercise any and all rights or remedies that a secured
party is or may be entitled to exercise and assert under Article 9 of
the Uniform Commercial Code of and as adopted by the State of New
Jersey; to enforce and otherwise foreclose upon every other security
interest in any and all Collateral as otherwise created or confirmed
under this Agreement, or any part thereof; to enforce and otherwise use
self-help and to recover, possess or foreclose upon every security
interest in any of the pledged Collateral under the Compost Stock
Pledge Agreement (Compost Common Stock), the Compost Stock Pledge
Agreement (Miami Common Stock) and/or the Compost Stock Pledge
Agreement (Bedminster Common Stock), or any part thereof; and/or, to
commence or institute any action, suit or other proceeding which
Lionhart, LHI and/or
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GEP may deem necessary or proper to protect their respective interests.
9.02. Acceleration-Obligations. Lionhart, LHI and GEP may, from
time to time at any time(s), declare any and all Obligations, that have
not been theretofore performed and discharged, immediately due and
required to be performed and discharged immediately, without further
notice or demand, or presentment, protest, notice of protest or notice
of dishonor (of which Compost, Miami and Bedminster hereby expressly
waive any such notice, demand, presentment, protest, notice of protest
or notice of dishonor), whereupon all such Obligations, as accelerated
under this Section 9.02, shall become immediately due and payable in
full, and Lionhart, LHI and GEP shall the right immediately to
foreclose upon the lien created by the Mortgage against the Mortgaged
Miami Site (as otherwise defined under the Mortgage); to enforce the
security interests granted under this Agreement, and to use self-help
and to recover, possess, repossess and otherwise dispose of the
Collateral, and to otherwise exercise any and all rights or remedies
that a secured party is or may be entitled to exercise and assert under
Article 9 of the Uniform Commercial Code of and as adopted by the State
of New Jersey; to enforce and otherwise foreclose upon every other
security interest in any and all Collateral as otherwise created or
confirmed under this Agreement, or any part thereof; to enforce and
otherwise use self-help and to recover, possess or foreclose upon every
security interest in any of the pledged Collateral under the Compost
Stock Pledge Agreement (Compost Common Stock), the Compost Stock Pledge
Agreement (Miami Common Stock) and/or the Compost Stock Pledge
Agreement (Bedminster Common Stock), or any part thereof; and/or, to
commence or institute any action, suit or other proceeding which
Lionhart, LHI and/or GEP may deem necessary or proper to protect their
respective interests.
9.03. Other Recourse and Remedies. Lionhart, LHI and GEP each
shall have all the remedies of a creditor and a secured party and
creditor under the Uniform Commercial Code of the State of New Jersey,
and as otherwise provided by applicable law, including but not limited
to the following:
(1) Possession/Sale. Lionhart, LHI and GEP may use
self-help with respect to the Collateral, may take possession
of the Collateral, or any part of it, and may use it, or sell
it, or any part of it, at any public or private sale, after
having taken possession of the Collateral, or any part of it.
For purposes of taking possession, Lionhart, LHI and GEP may
enter upon any premises on which the Collateral may be
situated without legal process and remove the Collateral.
Compost, Miami and Bedminster each hereby releases Lionhart,
LHI and GEP from any claims arising from such removal and
shall hold Lionhart, LHI and GEP harmless from any liability
resulting therefrom. Lionhart, LHI and GEP may require
Compost, Miami and/or Bedminster to assemble the Collateral
and make it available at a place to be designated by
Lionhart, LHI and GEP which is reasonably convenient to all
parties. Unless the Collateral threatens to decline speedily
in value or is of a type customarily sold on a recognized
market, Lionhart, LHI and/or GEP shall give Compost, Miami
and/or Bedminster at least thirty (30) days' prior written
notice of the time and place of any public sale thereof or of
the time after which any private sale or any other intended
disposition thereof is to be made. The reasonable expenses of
retaking, holding, preparing for sale, selling and the like,
and reasonable attorneys' fees and expenses incurred by
Lionhart, LHI and/or GEP shall be paid from the proceeds of
the disposition.
(2) Receivership/Replevin. Lionhart, LHI and/or GEP may
obtain the appointment of a receiver, custodian, conservator,
trustee or liquidator respecting the Collateral upon such
notice as may be required by applicable law and without
notice if permitted by such law, and may obtain immediate
possession thereof in replevin.
(3) Miscellaneous. Insofar as any Collateral shall
consist of accounts receivable, insurance policies,
instruments, chattel paper, intangibles, choses in action or
the like, Lionhart, LHI and/or GEP may demand, collect,
receipt for, settle, compromise, adjust, ▇▇▇ for, foreclose
or realize upon Collateral as Lionhart, LHI and/or GEP may
determine, whether or not the Indebtedness or Obligations or
Collateral are then due, and for the purpose of realizing
Lionhart's, LHI's and GEP's rights and interests therein,
Lionhart, LHI and GEP may receive, open and dispose of mail
addressed to Compost, Miami and/or Bedminster and endorse
notes, checks, drafts, money orders, documents of title or
other evidences of payment, shipment or storage or any form
of Collateral on behalf of and in the name of Compost, Miami
and Bedminster as its special and limited attorney-in-fact,
which shall be deemed to be coupled with an interest.
Page 7 of 13 Pages
(4) Cumulative Remedies. All remedies of Lionhart, LHI
and/or GEP, under this Agreement, the CCF Agreement, the
Credit Documents and/or the Definitive Supplemental
Documents, or under applicable law, shall be cumulative to
the full extent provided by law. Any pursuance by Lionhart,
LHI and/or GEP of any single judicial or other remedies shall
not ▇▇▇▇▇ nor bar resort to other remedies with respect to
the Collateral, and pursuit of certain remedies with respect
to all or some of the Collateral shall not bar other remedies
with respect to the Indebtedness, the Obligations, or other
portions of the Collateral, or as may otherwise be provided
under the CCF Agreement, the Credit Documents (including the
Mortgage and the Mortgage Note) and/or the Definitive
Supplemental Documents, and/or under any applicable law.
Lionhart, LHI and GEP may exercise its rights to the
Collateral without resorting or regard to other collateral or
sources of security or reimbursement for the Indebtedness
and/or Obligations (whether under the CCF Agreement, the
Credit Documents the Definitive Supplemental Documents, or
otherwise).
Section 10. Nonwaiver-Expenses, Proceeds of Collateral. No waiver (or
forbearance or other accomodation) by Lionhart, LHI and/or GEP of any of its or
their respective rights, and no waiver or inaction by Lionhart, LHI and/or GEP
of or upon the occurrence of any Event of Default, shall be effective unless in
writing, and in no event shall it operate as a waiver (or forbearance or other
accomodation) of any of its or their respective rights, or as a waiver of any
other Event of Default nor of the same rights or default on any future occasion.
Compost, Miami and Bedminster, jointly and severally, shall pay to Lionhart, LHI
and GEP, on demand by Lionhart, LHI and/or GEP, any and all expenses, including
reasonable attorneys' fees, incurred or paid by Lionhart, LHI and/or GEP in
protecting or enforcing its rights upon or under the Indebtedness, the
Obligations, the Collateral or this Agreement. After deducting all such
expenses, the residue of any proceeds of collection or sale of Collateral shall
be applied to the payment of Principal or Interest under the Note, and on the
principal and interest attributable to any other of the Indebtedness and/or
Obligations, in such order of preference as Lionhart, LHI and/or GEP may
determine, and Compost, Miami and Bedminster shall remain liable to Lionhart,
LHI and/or GEP for any deficiency thereof.
Section 11. Legal Authority/Compliance/Miscellaneous. Compost, Miami
and Bedminster, jointly and severally, each hereby represent and warrant, and
hereby promise, agree and covenant, as follows:
11.01. General Board Authorization. Compost, Miami and Bedminster
each has all necessary corporate power and authority, pursuant to the
approval by and the duly adopted resolutions of their respective Board
of Directors, and otherwise, to execute and deliver this Agreement, and
to perform their respective duties and obligations contemplated and as
otherwise provided under this Agreement.
11.02. No Violations. The execution and delivery of (and the
performance and consummation transactions contemplated under) this
Agreement, will not (i) conflict with or violate the Certificate of
Incorporation or By-Laws of Compost, Miami or Bedminster, (ii) conflict
with or violate any law, rule, regulation, order, judgment or decree
applicable to Compost, Miami or Bedminster, or by which its or any of
their respective Properties are bound or affected, or (iii) result in
any breach of or constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of,
or result in the creation of a lien or encumbrance on any of the
Properties or assets of any of the Compost, Miami and Bedminster
pursuant to any note, bond, mortgage, indenture, contract, agreement,
lease, license, permit, insurance policy or other instrument or
obligation to which either Compost, Miami and/or Bedminster is a party,
or by which either Compost, Miami and/or Bedminster or its or any of
their respective Properties are bound or affected.
11.03. No Required Governmental Consents. The execution and
delivery of (and the performance and consummation transactions
contemplated under) this Agreement by each of Compost, Miami and
Bedminster does not and will not, require any consent, approval,
authorization or permit from any Governmental Authority which has not
been obtained.
11.04. Authority of Officers. Compost, Miami and Bedminster each
have good right and lawful authority, through their designated and
respective officers and representatives who have signed and delivered
this Agreement, for and on behalf respectively of Compost, Miami and
Bedminster, to execute, deliver and consummate the transactions
contemplated under this Agreement.
Page 8 of 13 Pages
11.05. Enforceability. This Agreement is a legal, valid and
binding obligation of Compost, Miami and Bedminster, enforceable
against Compost, Miami and Bedminster in accordance with the terms of
this Agreement, and there is no action or proceeding at law or in
equity, or by or before any court or Governmental Authority now pending
or to the knowledge of Compost, Miami and/or Bedminster threatened or
affecting Compost, Miami and/or Bedminster, that may materially and
adversely affect Compost, Miami and/or Bedminster.
11.06. Execution by Parties. Any person or party executing this
Agreement in a representative capacity, acknowledges, warrants and
represents 1) that he or she is an official representative of the firm
or corporation in whose name he or she is executing this Agreement, 2)
that he or she possesses full and complete authority to bind said firm
or corporation to the full and faithful performance of all conditions,
terms, provisions, covenants, warranties and representations as
contained in this Agreement, and 3) that all other parties are relying
on these representations and warranties as a material inducement to
accept delivery of this Agreement, in consideration of and in exchange
for the delivery and/or execution by Lionhart, LHI and GEP of 1) the
Credit, 2) the CCF Agreement, 3) the Credit Documents and 4) the
Definitive Supplemental Documents, and the acceptance by Lionhart, LHI
and GEP from Compost, Miami and Bedminster of 1) the CCF Agreement, 2)
the Credit Documents and 3) the Definitive Supplemental Documents.
Section 12. Applicable Law, Jurisdiction and Venue. Compost, Miami and
Bedminster, jointly and severally, each hereby represent and warrant, and hereby
promise, agree (with Lionhart, LHI and GEP) and covenant, as follows:
12.01. This Mortgage Note shall be governed by, construed in
accordance with, and shall be enforced under, the laws of the State of
New Jersey, exclusive of its rules relating to conflict of laws.
12.02. Subject to applicable conflict of laws principles, Compost
shall accept venue with respect to all claims, actions or lawsuits that
relate to or arise from this Agreement, in any state court or U.S.
Court of competent jurisdiction that sits in Newark, New Jersey.
Compost hereby, and irrevocably and unconditionally, for itself and its
Properties, submits to the jurisdiction of any such New Jersey court or
U.S. Court sitting in Newark, New Jersey, and any appellate court with
jurisdiction thereover, in any action or proceeding relating to or
arising from this Agreement, the CCF Agreement (exclusive of the
Mortgage), the Credit Documents and/or the Definitive Supplemental
Documents, or for the recognition or enforcement of any judgment, and
Compost hereby, and irrevocably and unconditionally, agrees, promises
and covenants that all such claims in respect of any such action or
proceeding shall be heard, determined and adjudicated in by any such
New Jersey court or, to the extent permitted by applicable law, by any
such U.S. Court. Compost hereby agrees, promises and covenants that a
final judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in
any other manner provided by law.
12.03. Compost hereby, and irrevocably and unconditionally,
waives, to the fullest extent under applicable law, any defense or
objection that it may now or hereafter have 1) to the laying of venue
of any suit, action or proceeding relating to or arising from this
Mortgage Note, the CCF Agreement, the Credit Documents (exclusive of
the Mortgage) and/or the Definitive Supplemental Documents, in any such
New Jersey court or U.S. Court sitting in Newark, New Jersey, or 2) to
the personal jurisdiction and/or preferred and proper venue of any such
New Jersey court or any such U.S. Court in Newark, New Jersey.
Section 13. Captions/Headings. The captions and headings that are set
forth in this Agreement are for the purpose of convenience only and are not
intended to be a part of this Agreement and shall not be deemed to modify,
explain, enlarge or restrict any of the provisions hereof.
Section 14. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any applicable jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provisions in any other
jurisdiction.
Section 15. Binding Obligations. The terms and provisions, and
promises, covenants and undertakings of this Agreement, shall bind and be
enforceable against and upon Compost, Miami and Bedminster, jointly and
severally, and their respective successors and assigns and other legal agents
and representatives, and shall inure to the benefit of Lionhart, LHI and GEP,
and their respective successors and assigns, transferees, credit participants,
guarantors and endorsees. If, at any time or
Page 9 of 13 Pages
times, by assignment or otherwise, Lionhart, LHI and/or GEP transfer any of the
Indebtedness or Obligations, any such transfer shall carry with it Lionhart's,
LHI's and GEP's rights, interests and powers under this Agreement, including all
such rights, interests and powers that relate to or arise from this Agreement.
Lionhart, LHI and GEP, in their sole discretion and at their sole option, shall
have the right to assign this Agreement, as well as the CCF Agreement, the other
Credit Documents and the Definitive Supplemental Documents, to any successor(s)
or assign(s) of Lionhart, LHI and/or GEP.
Section 16. Time of the Essence. Time is hereby declared to be of the
essence of this Agreement, and of every part hereof.
SECTION 17. JURY WAIVER. COMPOST, MIAMI AND BEDMINSTER EACH DO HEREBY
KNOWINGLY, VOLUNTARILY, IRREVOCABLE, UNCONDITIONALLY AND INTENTIONALLY WAIVE THE
RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, THE CCF AGREEMENT, THE
CREDIT DOCUMENTS AND/OR THE DEFINITIVE SUPPLEMENTAL DOCUMENTS, OR ANY COURSE OF
CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS
OF ANY PERSON. THIS IRREVOCABLE WAIVER OF THE RIGHT TO A JURY TRIAL IS A
MATERIAL INDUCEMENT FOR LIONHART, LHI AND/OR GEP TO DELIVER THE CREDIT, AND TO
EXECUTE AND DELIVER, AND OTHERWISE CONSUMMATE THE TRANSACTIONS CONTEMPLATED
UNDER, THE CCF AGREEMENT, THE CREDIT DOCUMENTS AND THE DEFINITIVE SUPPLEMENTAL
DOCUMENTS.
Section 18. Counterparts/Facsimile. This Agreement may be executed in
any number of counterparts, and each by fax, e-mail or other digital or
telephonic transmission, and each of which shall be an original, but all of
which together will constitute one and the same instrument.
Section 19. Notices. Any notices by or to Compost, Miami and/or
Bedminster, or by or to Lionhart, LHI and/or GEP, under this Agreement, shall be
given as provided under Section 20.04 of the CCF Agreement.
Section 20. Written Instrument Requirement. This Agreement cannot be
altered, amended, modified or discharged orally and no executory agreement shall
be effective to modify or discharge this Agreement, in whole or in part, unless
it is in writing and signed by the party against whom enforcement of the
modification, alteration, amendment or discharge is sought.
Section 21. Assignment. This Agreement, and any rights hereunder, may
be assigned by Lionhart, LHI and/or GEP, or any of their respective successors
and assigns, at their sole discretion and option. This Agreement may not be
assigned by Compost, Miami and/or Bedminster, and Compost, Miami and Bedminster
each shall not delegate any of their duties under this Agreement, in whole or in
part, without the advance written consent of Lionhart, LHI and GEP (pursuant to
which any such consent may be granted or withheld in the sole discretion of
Lionhart, LHI and/or GEP).
Section 22. Definitions. All capitalized terms that are set forth in
this Agreement, and that are not expressly defined under this Agreement, shall
have the meanings and definitions that are assigned or ascribed to such terms in
the CCF Agreement, the Credit Documents and/or the Definitive Supplemental
Documents.
Section 24. Incorporation of Documents. The CCF Agreement, the Credit
Documents (including the Mortgage, the Mortgage Note, the Compost-Miami
Guaranty, the Compost Stock Pledge Agreement (Compost Common Stock), the Compost
Stock Pledge Agreement (Miami Common Stock) and the Compost Stock Pledge
Agreement (Bedminster Common Stock)) and the Definitive Supplemental Documents,
and all other agreements, instruments or other documents that are referred to in
this Agreement, and/or Exhibit A or Exhibit B hereto, are hereby incorporated by
reference and form a part of this Agreement.
IN WITNESS WHEREOF, Compost, Miami and Bedminster, and Lionhart, LHI
and GEP, have executed and delivered this Agreement on and as of this 30th day
of October, 1998.
Debtor: COMPOST AMERICA HOLDING COMPANY, INC.
--------------------------------------
Page 10 of 13 Pages
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief Executive Officer
MIAMI RECYCLING AND COMPOSTING COMPANY, INC.
--------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief Executive Officer
BEDMINSTER SEACOR SERVICES MIAMI CORPORATION
--------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief Executive Officer
Secured Parties: LIONHART GLOBAL APPRECIATION FUND, LTD.
--------------------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Director
LIONHART INVESTMENTS, LTD.
--------------------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Director
GLOBAL EARTHFUND PARTNERS, L.L.C.
--------------------------------------
▇▇▇ ▇. ▇▇▇▇▇
President
Page 11 of 13 Pages
Exhibit A
Schedule of Other Collateral
Page 12 of 13 Pages
Exhibit B
Permitted Encumbrances
Page 13 of 13 Pages
Page 14 of 13 Pages