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EXHIBIT 10.20
STOCK PLEDGE AGREEMENT
THIS AGREEMENT is entered into as of May 19, 1999 by XXXXXXXX XXXXXXXXX
("Pledgor"), and INTERLAND, INC., a Georgia corporation ("Pledgee").
WHEREAS, Pledgee has accepted from Pledgor (i) that certain Promissory
Note dated December 15, 1998; and (ii) that certain Promissory Note dated May
19, 1999, executed by Pledgor in favor of Pledgee (said Promissory Notes being
collectively referred to as the "Note");
WHEREAS, as a condition to accepting the Note, and without which
Pledgee would not have accepted the Note, Pledgee has required Pledgor to pledge
to Pledgee the Pledged Securities (as defined below) pursuant to the terms and
conditions contained herein in order to secure all of Pledgor's obligations to
Pledgee under the Note; and
WHEREAS, Pledgor desires to so pledge the Pledged Securities to
Pledgee.
THEREFORE, for and in consideration of the foregoing premises and the
mutual agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
1. SECURITY FOR OBLIGATIONS. This Agreement is for the benefit of
Pledgee to secure the prompt payment in full when due, whether upon demand or
otherwise, of any and all amounts due to Pledgee from Pledgor under the Note
(collectively, the "Secured Obligations").
2. PLEDGED SECURITIES.
2.1. Pledged Stock. As used herein, the term "Pledged
Stock" means 400,000 shares of the no par value per share common stock of the
Company, presently represented by certificate(s) number(ed) 77 and all
replacements and substitutions therefor.
2.2. Pledgor's Representations and Warranties. Pledgor
hereby represents and warrants that (i) he is the legal, record and beneficial
owner of, and has good and marketable title to, the Pledged Securities, subject
to no lien, claim, charge, encumbrance or security interest whatsoever, however
evidenced or created, other than that created by this Agreement in favor of
Pledgee; (ii) he has full power, authority and legal right to pledge all the
Pledged Securities pursuant to this Agreement; and (iii) the pledge and delivery
of the Pledged Securities pursuant to this Agreement creates a valid and
perfected first priority security interest in the Pledged Securities, and any
and all proceeds thereof, which security interest is not subject to any prior
lien, claim, charge, encumbrance or security interest.
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3. PLEDGE OF SECURITIES, ETC.
3.1. Pledge. To secure the Secured Obligations and for the
purposes set forth in Section 1, Pledgor hereby pledges to Pledgee the Pledged
Stock, together with (i) any and all certificates or other instruments now or
hereafter representing any or all of the Pledged Stock accompanied by stock
powers duly executed in blank by Pledgor, and (ii) all cash and non-cash
proceeds of the foregoing; and hereby assigns, transfers, hypothecates and sets
over to Pledgee all of Pledgor's right, title and interest in and to the Pledged
Stock (and in and to the certificates or instruments evidencing the items
described in clause (i) above) to be held by Pledgee, upon the terms and
conditions set forth in this Agreement. Pledgor shall deliver to Pledgee all
certificates and instruments evidencing the items described in clause (i) above
promptly upon Pledgor's receipt thereof.
3.2. Definition of Pledged Securities and Collateral. The
Pledged Stock and all items described in clause (i) of Section 3.1 hereof are
hereinafter collectively called the "Pledged Securities," and the Pledged
Securities, together with all other securities and moneys received or to be
received and at the time held by Pledgee hereunder and any cash or non-cash
proceeds of any of the foregoing, are hereinafter collectively called the
"Collateral."
4. VOTING, ETC. Unless and until an Event of Default (as defined
below) occurs and is continuing, Pledgor shall be entitled to vote any and all
Pledged Stock and to give consents, waivers or ratifications in respect thereof.
5. EVENT OF DEFAULT.
5.1. Definition of Event of Default. "Event of Default"
means any default or event of default under the Note.
5.2. Remedies. If an Event of Default occurs and is
continuing, Pledgee shall be entitled to exercise all of the rights, powers and
remedies (whether vested in it by this Agreement or by law and including,
without limitation, all rights and remedies of a secured party of a debtor in
default under the Uniform Commercial Code (the "Code") in effect in the State of
Georgia at that time) for the protection and enforcement of its rights in
respect of the Collateral, and Pledgee shall be entitled, without limitation, to
exercise the following rights and remedies:
(a) to receive all amounts payable in respect of
the Collateral to Pledgor and to enforce the payment of the Pledged
Securities and to exercise all of the rights, powers, and remedies of
Pledgor thereunder;
(b) to transfer all or any part of the
Collateral into Pledgee's name or the name of its nominee(s);
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(c) to vote all or any part of the Collateral
(whether or not transferred into the name of Pledgee) and give all
consents, waivers and ratifications in respect of the Collateral and
otherwise act with respect thereto as though it were the outright owner
thereof; and
(d) at any time or from time to time to sell,
assign and deliver, or grant options to purchase, all or any part of
the Collateral in one or more parcels, or any interest therein, at any
public or private sale at any exchange, broker's board or at any of
Pledgee's offices or elsewhere, without demand of performance,
advertisement or notice of intention to sell or of the time or place of
sale or adjournment thereof or to redeem or otherwise (all of which are
hereby expressly and irrevocably waived by Pledgor), for cash, on
credit or for other property, for immediate or future delivery without
any assumption of credit risk, and for such price or prices and on such
terms as Pledgee in its sole discretion may determine. Pledgor agrees
that to the extent that notice of sale shall be required by any
applicable law that ten business days notice to Pledgor of the time and
place of any public sale or the time after which any private sale is to
be made shall constitute reasonable notification.
6. REMEDIES, ETC. CUMULATIVE. Each right, power and remedy of
Pledgee provided for in this Agreement or any other financing document or now or
hereafter existing at law or in equity or by statute shall be cumulative and
concurrent and shall be in addition to every other such right, power or remedy.
The exercise or beginning of the exercise by Pledgee of any one or more of the
rights, powers or remedies provided for in this Agreement or any other financing
document or now or hereafter existing at law or in equity, or by statute or
otherwise, shall not preclude the simultaneous or later exercise by Pledgee of
all such other rights, powers or remedies, and no failure or delay on the part
of Pledgee to exercise any such right, power or remedy shall operate as a waiver
thereof.
7. APPLICATION OF PROCEEDS. All moneys collected by Pledgee upon
any sale, collection or other disposition of the Collateral, together with all
other moneys received by Pledgee hereunder, shall be applied to the payment of
the Secured Obligations then due, and Pledgee shall be entitled to any surplus
then remaining.
8. COVENANTS OF PLEDGOR. Pledgor covenants and agrees that (i)
Pledgor shall not grant or suffer to exist any other lien, claim, charge,
encumbrance or security interest whatsoever, however evidenced or created, other
than that created by this Agreement in favor of Pledgee whether or not
subordinate to the liens granted hereunder, and (ii) Pledgor will defend
Pledgee's right, title and security interest in and to the Pledged Securities
and the proceeds thereof against the claims and demands of all persons
whomsoever.
9. NOTICES, ETC. All notices and other communications hereunder
shall be effective on the third day after being deposited in the United States
mail, first class postage prepaid, certified or registered, return receipt
requested, to the respective parties at their last known addresses. Each party
may give to the other notice of a change of its address as
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provided in this Section 9, provided however that no notice of such change of
address shall be effective until actual receipt thereof by the addressee.
10. TERMINATION, RELEASE. Upon the full payment and performance of
all of the Secured Obligations, this Agreement shall terminate, and Pledgee
shall execute and deliver to Pledgor a proper instrument or instruments
acknowledging the satisfaction and termination of this Agreement, and will duly
assign, transfer and deliver to Pledgor (without recourse and without any
representation or warranty) such of the Collateral as is in Pledgee's possession
and as has not theretofore been sold or otherwise applied or released pursuant
to this Agreement, together with any moneys at the time held by Pledgee
hereunder.
11. MISCELLANEOUS. This Agreement shall create a continuing
security interest in the Collateral and shall be binding upon the successors and
assigns of Pledgor, and shall inure to the benefit of and be enforceable by
Pledgee and its successors and assigns. This Agreement may be changed, waived,
discharged or terminated only in a writing signed by the parties or as otherwise
expressly provided herein. Unless otherwise defined herein or in the Note, terms
defined in Article 9 of the Code in the State of Georgia are used herein as
therein defined. The headings in this Agreement are for purposes of reference
only and shall not limit or define the meaning hereof.
12. GOVERNING LAW. This Agreement and the rights and obligations
of the parties hereunder shall be construed in accordance with and be governed
by the law of the State of Georgia (without giving effect to its conflict of
laws principles).
IN WITNESS WHEREOF, Pledgor and Pledgee have each executed this
Agreement as of the date first above written.
/s/ Xxxxxxxx Xxxxxxxxx
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XXXXXXXX XXXXXXXXX
INTERLAND, INC.
By: /s/ Xxxxxxx Xxxxxx
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Name: Xxxxxxx Xxxxxx
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Title: Vice President
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IRREVOCABLE STOCK POWER
FOR VALUE RECEIVED, the undersigned, XXXXXXXX XXXXXXXXX ("Assignor"),
has fully and irrevocably granted, assigned and transferred and hereby does
fully and irrevocably grant, assign and transfer to INTERLAND, INC., and the
successors, transferees, assigns and personal representatives thereof
(collectively referred to herein as "Assignee"), the following property:
400,000 shares of the Common Stock of Interland, Inc.,
represented by Certificate(s) No. 77 and standing in
Assignor's name on the books of said corporation.
Assignor hereby irrevocably appoints Assignee to be Assignor's true
and lawful attorney-in-fact, with full power of substitution, and empowers
Assignee, for and in the name and stead of Assignor, to sell, transfer,
hypothecate, liquidate or otherwise dispose of all or any portion of the
above-described securities, from time to time, and, for that purpose, to make,
sign, execute and deliver any documents or perform any other act necessary for
such sale, transfer, hypothecation, liquidation or other disposition. Assignor
acknowledges that this appointment is coupled with an interest and shall not be
revocable by Assignor's death or for any other reason. Assignor hereby ratifies
and approves all acts that Assignee or any substitute therefore shall do by
virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this document as
of May 19, 1999.
/s/ Xxxxxxxx Xxxxxxxxx
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XXXXXXXX XXXXXXXXX
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