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Exhibit 10.78
PLEDGE AGREEMENT
CROWN NORTHCORP, INC., a Delaware corporation (hereinafter called
"Owner"), and MARRAY INVESTMENT, LLC (the "Pledgee") agree as follows:
1. PLEDGE AND CREATION OF SECURITY INTEREST. In consideration of an
extension of credit evidenced by that certain Convertible Secured Promissory
Note from Owner to Pledgee dated as of even date herewith (together with any and
all renewals, extensions, replacements, substitutions, amendments and
modifications thereof, the "Note") and as security for the payment of all debts,
obligations or liabilities now or hereafter existing, absolute or contingent, of
Owner to Pledgee under the Note (hereinafter called "Indebtedness"), including
without limitation, the payment of all principal, interest, charges, expenses
and other amounts, Owner hereby assigns, transfers, grants to and pledges with
Pledgee title to and a security interest in the collateral described in
paragraph 2 hereof.
2. COLLATERAL. As security for the Indebtedness, Owner hereby assigns,
transfers, grants to and pledges with Pledgee title to and a security interest
in a 5.94% membership interest in HMR Sweden, L.L.C., and all money and property
heretofore delivered or which shall hereafter be delivered to or come into the
possession, custody or control of Pledgee in any manner or for any purpose
whatsoever in connection with such 5.94% membership interest during the
existence of this Agreement, together with all membership rights, rights to
subscribe, liquidating and all other distributions, new membership interests
and/or units or securities, or other property which Owner is now or may
hereafter become entitled to receive on account of such collateral or accessions
thereto and all proceeds of, accessions and additions to and substitutions for
all of the foregoing, whether now owned or existing or hereafter created,
acquired or arising. All interests, money and property assigned, transferred and
pledged to Pledgee pursuant to this paragraph are hereinafter referred to as the
"Collateral".
3. OBLIGATIONS OF OWNER.
3.1 Owner shall pay to Pledgee all expenses and expenditures, including
but not limited to reasonable attorneys' fees and other legal expenses, incurred
or paid by Pledgee incidental to holding, collecting, exchanging, preserving,
exercising rights in respect of or realizing upon any of the Collateral or the
Indebtedness.
3.2 Owner shall, at its expense, make, do, execute, deliver or file any
act, thing, statement, instrument, document, or other paper in such form and
substance as Pledgee may request in order to create, preserve, perfect, or
validate any security interest or to enable Pledgee to exercise or enforce its
rights with respect to such security interest.
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4. PLEDGEE'S OBLIGATIONS. Pledgee's duty with respect to the Collateral
shall be solely one of reasonable care and shall not include any obligation to
collect any sums due in respect thereof or to preserve rights against other
parties or any other rights relative thereto, nor the duty to send notices,
perform services, or take any action in connection with the Collateral.
5. DEFAULT.
5.1 The occurrence or existence of any default or Event of Default
under the Note shall constitute a default ("Default")
hereunder.
5.2 Upon the occurrence of any Default and at any time thereafter,
without notice, and at Owner's expense, Pledgee may, but shall not be obligated
to:
5.2.1 collect by legal proceedings or otherwise all
distributions, interest, principal payments, income, and other sums now or
hereafter payable upon or on account of the Collateral, and hold the same as
Collateral or apply the same to any Indebtedness, the manner, distribution and
application to be in Pledgee's sole discretion;
5.2.2 demand, xxx for, collect or make any compromise or
settlement with reference to the Collateral as Pledgee, in its sole discretion,
chooses;
5.2.3 transfer the Collateral to Pledgee's name or the name of
its nominee and/or exercise as to the Collateral all the rights, powers and
remedies of an owner;
5.2.4 sell, assign and deliver all or any part of the
Collateral at public or private sale;
5.2.5 apply the proceeds of any sale or other disposition of
the Collateral first to the payment of expenses incurred by Pledgee in making
such sale or disposition, together with reasonable attorneys' fees if incurred;
and
5.2.6 exercise all rights and remedies provided for a secured
party in the Uniform Commercial Code as enacted in Alabama at the date of this
Agreement and other rights and remedies available at law or in equity.
6. ADDITIONAL AGREEMENTS, REPRESENTATIONS AND WARRANTIES.
6.1 Owner hereby represents, warrants and agrees that:
6.1.1 demand, notice, protest and all demands and notices of
any action taken by Pledgee except those expressly required herein are hereby
waived;
6.1.2 Owner has full power and authority to execute and
deliver this Agreement and the Note and to pledge the Collateral hereunder, that
the Collateral is not subject to the interest of any person other than Owner,
and that Owner will defend the Collateral and its proceeds or accessions against
the claims and demands of all third persons; and
6.1.3 demands or notices may be given personally, by telegram,
telecopy, or by mailing the same to Owner's address as indicated on the records
of HMR Sweden, L.L.C.
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6.2 Owner and Pledgee agree that:
6.2.1 "Pledgee" and "Owner" as used herein shall include the
successors, receivers, trustees and assigns of those parties.
6.2.2 the laws of Alabama shall govern the construction of and
the interests, rights and duties of the parties to this Agreement.
This Agreement is executed effective as of August 27, 1998.
OWNER:
WITNESS OR ATTEST: CROWN NORTHCORP, INC.
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxxx
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Its: Secretary Its: CFO
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