Exhibit 10.61
PLEDGE AGREEMENT SILICON VALLEY BANK
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May 14, 2002
To secure the prompt, punctual, and faithful performance of all and
each of the Obligations (as that term is defined herein) of the undersigned,
Interliant, Inc., a Delaware corporation, formerly known as Sage Newtworks,
Inc., with offices at ▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
(hereinafter, the "Borrower") to Silicon Valley Bank, a California-chartered
bank, with its principal office located at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and with a loan production office located at One Newton
Executive Park, Suite 200, 2221 Washington Street, Newton, Massachusetts
02462(hereinafter, the "Lender"), the Borrower hereby grants to the Lender a
security interest in and to, and assigns, pledges, and delivers to the Lender
the following property, and all products, proceeds, substitutions, additions,
interest, dividends, and other distributions (including, without limitation,
stock splits) in respect thereto, and all books, records, and papers relating to
the foregoing (all of which is referred to hereinafter as the "Collateral"):
(i) Certificate No. 1 representing 100% of the issued and outstanding
common stock of Interliant International, Inc.
(ii) Certificate No. 1, representing 100% of the issued and
outstanding common stock of Interliant Acquisition Corp. (fka
Sage Networks Acquisition Corp.)
(iii) Certificate No. 1, representing 100% of the issued and
outstanding common stock of Interliant Consulting and
Professional Services, Inc. (fka Net Daemons Associates, Inc.)
(iv) Certificate No. 1, representing 100% of the issued and
outstanding common stock of Interliant Association Solutions,
Inc. (fka Knowledge Systems, Inc.)
(v) Certificate No. 1, representing 100% of the issued and
outstanding common stock of Interliant Texas, Inc.
(vi) Certificate No. 1, representing 100% of the issued and
outstanding common stock of The ▇▇▇▇▇▇▇▇ Consulting Group, Inc.
(fka ▇▇▇▇▇▇▇▇ Acquisition Corp.)
(vii) Certificate No. 1, representing 100% of the issued and
outstanding common stock of TP Successor Corp. (fka
Telephonetics, Inc.)
1. The Borrower represents that the Collateral is held and owned by
the Borrower free and clear of all liens, encumbrances, attachments, security
interests, pledges, and charges, and if the Collateral is securities, is fully
paid for and nonassessable.
2. The Borrower shall:
(a) execute all such instruments, documents, and papers, and
will do all such acts as the Lender may request from time to time to
carry into effect the provisions and
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intent of this Agreement, including, without limitation, the execution
of stop transfer orders, stock powers, notifications to obligors on the
Collateral, the providing of notifications in connection with book
entry securities or general intangibles, and the providing of
instructions to the issuers of uncertificated securities, and will do
all such other acts as the Lender may reasonably request with respect
to the perfection and protection of the security interest granted
herein and the assignment effected hereby;
(b) keep the Collateral free and clear of all liens,
encumbrances, attachments, security interests, pledges, and charges
other than those created by this Agreement;
(c) deliver to the Lender, if and when received by the
Borrower, any item representing or constituting any of the Collateral,
including, without limitation, all cash dividends (except that the
Borrower may collect such cash dividends prior to the occurrence of an
Event of Default) and all stock certificates whether now existing or
hereafter received as a result of any stock dividends, stock splits or
other transaction;
(d) upon the request of the Lender after the occurrence of an
Event of Default which is not cured, cause the issuer of any
uncertificated securities comprising any of the Collateral to issue
certificates with respect thereto;
(e) upon the request of the Lender after the occurrence of an
Event of Default which is not cured, cause certificated securities
comprising any of the Collateral to be issued in the name of the
Lender, as pledgee;
(f) not cause or permit any of the Collateral presently
evidenced by written certificates to be converted to uncertificated
securities;
(g) not exercise any right with respect to the Collateral which
would dilute or adversely affect the Lender's rights in the Collateral;
(h) not file any affidavit for replacement of lost stock
certificates or bonds; and
(i) not vote the Collateral in favor of or consent to any
resolution which might
(i) impose any restrictions upon the sale, transfer, or
disposition of the Collateral; or
(ii) result in the issuance of any additional shares of stock of
any class; or
(iii) vest additional powers, privileges, preferences, or
priorities to any other class of stock.
3. Upon the occurrence of any one or more Events of Default, (as
defined in a certain Loan and Security Agreement of even date (as may be
amended, the "Loan Agreement"), which Events of Default are not cured in
accordance with the terms of the Loan Agreement or
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otherwise to the satisfaction of the Lender, any and all Obligations of the
Borrower to the Lender shall become immediately due and payable at the option of
the Lender and without notice or demand, in addition to which the Lender may
exercise the Lender's rights and remedies upon default, as provided in the Loan
Agreement.
4. The Borrower hereby designates the Lender as and for the
attorney-in-fact of the Borrower to, upon or after the occurrence of an Event
of Default: endorse in favor of the Lender any of the Collateral; cause the
transfer of any of the Collateral in such name as the Lender may, from time to
time, determine; cause the issuance of certificates for book entry and/or
uncertificated securities; and make demand and initiate actions to enforce the
Lender's rights with regard to any of the Collateral. The Lender may take such
action with respect to the Collateral as the Lender may reasonably determine to
be necessary to protect and preserve its interest in the Collateral. The Lender
shall also have and may exercise at any time all rights, remedies, powers,
privileges, and discretions of the Borrower with respect to and under the
Collateral, provided, however, the Lender shall have no right to exercise any
voting rights available to holders of the Collateral at any time the Collateral
is held by the Lender solely as pledgee hereunder, and whether or not an Event
of Default has occurred, all of which rights shall remain with the Borrower
except as provided in the following sentence. All of the rights, remedies,
powers, privileges and discretions included in this Paragraph 5, may only be
exercised by the Lender upon or after the occurrence of an Event of Default. The
within designation, being coupled with an interest, is irrevocable until the
within instrument is terminated by a written instrument executed by a duly
authorized officer of the Lender. The power of attorney shall not be affected by
subsequent disability or incapacity of the Borrower. The Lender shall not be
liable for any act or omission to act pursuant to this Paragraph except for any
act or omission to act which is in actual bad faith, intentional wrong-doing, or
gross negligence.
5. As used herein, the following terms have the following meanings:
(a) "Obligation" and "Obligations" are defined as provided in the
Loan Agreement.
(b) "Events of Default" are defined as provided in the Loan
Agreement.
6. Except to the extent provided in the Loan Agreement, the Borrower
(a) waives presentment, demand, notice, and protest with respect to the
Obligations and the Collateral; and (b) waives any delay on the part of the
Lender without notice to or consent from the Borrower; and (c) assents to any
indulgence or waiver which the Lender may grant or give any other person liable
or obliged to the Lender for or on the Obligations without notice to or consent
from the Borrower; and (d) authorizes the Lender to alter, amend, cancel, waive,
or modify any term or condition of the obligations of any other person liable or
obligated to the Lender for or on the Obligations, without notice to or consent
from the Borrower; and (e) agrees that no release of any property securing the
Obligations, without notice to or consent from the Borrower, shall affect the
rights of the Lender with respect to the Collateral hereunder; and, if entitled
thereto, (f) waives the right to notice and/or hearing prior to the Lender's
exercising of the Lender's rights and remedies hereunder upon the occurrence and
during the continuance of an Event of Default.
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7. The Lender shall have no duty as to the collection or protection of
the Collateral or any income or distribution thereon, beyond the safe custody of
such of the Collateral as may come into the possession of the Lender and shall
have no duty as to the preservation of rights against prior parties or any other
rights pertaining thereto. The Lender's Rights and Remedies may be exercised
without resort or regard to any other source of satisfaction of the Obligations.
8. This Agreement shall be binding upon the Borrower and upon the
Borrower's administrators, successors, and assigns, and shall inure to the
benefit of the Lender and the Lender's successors and assigns.
9. This Agreement and all other instruments executed in connection with
the Obligations incorporate all discussions and negotiations between the
Borrower and the Lender concerning the matters included herein and in such other
instruments. No such discussions or negotiations shall limit, modify, or
otherwise affect the provisions hereof. No modification, amendment, or waiver of
any provision of the within Agreement or of any provision of any other agreement
between the Borrower and the Lender shall be effective unless executed in
writing by the party to be charged with such modification, amendment of waiver,
and if such party be the Lender, then by a duly authorized officer thereof.
10. It is intended that this Agreement take effect as a sealed
instrument.
("Borrower")
Signed in my Presence Interliant, Inc.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title: Chief Financial Officer
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