Contract
Exhibit 10.3
THIS
PLEDGE AGREMEENT IS SUBJECT TO THE TERMS OF A SUBORDINATION AND
INTERCREDITOR AGREEMENT, DATED AS OF FEBRUARY 28, 2017, BY AND
AMONG THE PLEDGOR, THE SECURED PARTY AND M&T BANK.
This
Pledge Agreement (the “Pledge
Agreement”) is entered into this 28th day of February
2017 by LB&B Associates Inc., a North Carolina corporation (the
“Pledgor”) in
favor of Brekford Corp., a Delaware corporation (the
“Secured
Party”).
WHEREAS, pursuant to the terms of that
certain Subordinated Note dated as of February 28, 2017 (as amended
and in effect from time to time, the “Note”) issued
by Pledgor in favor of the Secured Party, the Secured Party has
agreed to make a loan to the Pledgor upon and subject to the terms
and conditions set forth therein;
WHEREAS, it is a condition precedent to
the obligation of the Secured Party to make the loan to the Pledgor
under the Note that the Pledgor shall have executed and delivered
this Pledge Agreement to the Secured Party for the purpose of
securing the Pledgor’s obligations to the Secured
Party;
WHEREAS, the Pledgor is the legal and
beneficial owner of the LLC Interests (as hereinafter defined) in
Global Public Safety, LLC (the “Company”);
NOW, THEREFORE, in consideration of the
foregoing premises and to induce the Secured Party to enter into
the Note and to make the loan to the Pledgor under the Note, the
Pledgor agrees as follows:
SECTION
1. DEFINITIONS.
All
capitalized terms used herein without definition shall have the
respective meanings ascribed thereto in the Note. Any term used in
this Pledge Agreement which is defined in the UCC (as defined
below) and not otherwise defined in this Pledge Agreement or the
Note shall have the meaning ascribed thereto in the UCC. The
following terms shall have the following meanings:
“Collateral” means the LLC
Interests.
“Default” means the
occurrence of an event of default under the Note or a material
default by the Pledgor under this Agreement that is not cured
within 10 days written notice from the Secured Party of such
breach.
“LLC Agreement” means any
limited liability agreement, operating agreement, membership
agreement, partnership agreement or similar agreement relating to
any LLC Interests, as amended and in effect from time to
time.
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“LLC Interests” means the
801 Units of ownership interest in the Company purchased by the
Pledgor from the Secured Party on the date hereof pursuant to that
certain Contribution and Unit Purchase Agreement by, between and
among the Xxxxxxx, the Secured Party and the Company as of the date
hereof.
“Loan Documents” refers to
this Pledge Agreement and the Note.
“Obligations” means any
and all obligations of the Pledgor to make payments of principal
and interest under the Note.
“Pledge Agreement” means
this Pledge Agreement, as amended, restated, supplemented or
otherwise modified from time to time in accordance
herewith.
“Proceeds” means all
“Proceeds” as such term is defined in Article 9 of the
UCC and, in any event, shall include, without limitation, all
dividends or other income from the LLC Interests, collections
thereon, proceeds of sale thereof or distributions with respect
thereto.
“Security Interest” means
the security interest granted pursuant to Section 2.
“UCC” means the Uniform
Commercial Code as presently and hereafter enacted in the State of
Delaware.
SECTION
2. PLEDGE
AND GRANT OF SECURITY INTEREST.
The
Pledgor hereby grants to the Secured Party a continuing second
priority lien and security interest in the LLC Interests and all
other Collateral, free and clear of any liens other than liens
granted to M&T Bank by the Pledgor (the “Senior Liens”), as
collateral security for the prompt, timely and complete payment
when due (whether at the stated maturity, by acceleration or
otherwise) of the Obligations. At the time the
Collateral becomes subject to the lien and security interest
created by this Agreement,
the Pledgor
will be the sole, direct, legal and beneficial owner thereof, free
and clear of any lien, security interest, encumbrance, claim,
option or right of others except for the Senior Liens, the security
interest created by this Agreement or otherwise created by the Secured
Party.
SECTION
3. UCC
FILING.
Pursuant to the UCC
and any other applicable law, the Pledgor authorizes the Secured
Party to file or record financing statements and other documents or
instruments with respect to the LLC Interests and all other
Collateral without the signature of the Pledgor in such form and in
such offices as the Secured Party determines appropriate to perfect
the Security Interest granted to the Secured Party under this
Pledge Agreement. Such financing statements may describe the
Collateral in the same manner as described herein or may contain an
indication or description of Collateral that describes such
property in any other manner as the Secured Party may reasonably
determine, in its sole discretion, is necessary, advisable or
prudent to ensure the perfection of such Security
Interest.
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SECTION
4. REPRESENTATIONS
AND WARRANTIES.
To
induce the Secured Party to execute the Note and make any
extensions of credit and to accept the security contemplated
hereby, the Pledgor hereby represents and warrants
that:
A. The Security
Interest granted by the Pledgor will constitute a valid and
perfected second priority lien on the Collateral described
herein.
B. The LLC constitute
all of the issued and outstanding ownership interests of the
Company purchased from the Secured Party in which the Pledgor has
any right, title or interest.
C. The Pledgor is the
record and beneficial owner of, and has good and marketable title
to, the LLC Interests free and clear of any and all liens or
options in favor of, or claims of, any other person, except the
Senior Liens, the Security Interest created by this Pledge
Agreement or liens or options in favor of, or claims of, any other
person that were created by the Secured Party prior to the
Pledgor’s purchase of the such LLC Interests from the Secured
Party. The Pledgor is entitled to pledge its LLC Interests to, and
grant and collaterally assign to, the Secured Party a security
interest in its LLC Interests without any further consent, approval
or action by any other party, including, without limitation, any
other party to any LLC Agreement.
D. The name and
address of the Pledgor listed in Section 22F are the
Pledgor’s exact legal name and address. Pledgor is a North
Carolina corporation. There has been no change in the name of the
Pledgor within the five (5) years preceding the date hereof except
as previously reported in writing to the Secured Party. The Pledgor
has not moved its state of formation within the five (5) years
preceding the date hereof except as previously reported in writing
to the Secured Party.
E. Upon the filing of
financing statements in the appropriate offices pursuant to the UCC
with respect to LLC Interests, the Security Interest granted
pursuant to this Pledge Agreement will constitute a valid,
perfected second priority lien on the Collateral, enforceable as
such against all creditors of the Pledgor other than M&T Bank
and any persons purporting to purchase any of the Collateral from
the Pledgor.
SECTION
5. CERTAIN
COVENANTS.
The
Pledgor covenants and agrees with the Secured Party that, from and
after the date of this Pledge Agreement until the Obligations are
paid in full:
A. The Pledgor shall
promptly notify the Secured Party, in writing, of any lien (other
than the Security Interest granted pursuant to this Pledge
Agreement or any Senior Liens) on any of the
Collateral.
B. Without the prior
written consent of the Secured Party, the Pledgor will not (i)
sell, assign, transfer, exchange, or otherwise dispose of, or grant
any option with respect to, the Collateral, or (ii) create, incur
or permit to exist any lien or option in favor of, or any claim of
any person with respect to, any of the Collateral, or any interest
therein, except the Senior Liens and the Security Interest granted
pursuant to this Pledge Agreement. The Pledgor shall maintain the
Security Interest created by this Pledge Agreement as a perfected
lien and defend the right, title and interest of the Secured Party
in and to the Collateral against the claims and demands of all
other
persons other than M&T Bank.
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C. The Pledgor will
not, except upon prior written notice to the Secured Party and
delivery to the Secured Party of all additional instruments and
documents reasonably requested by the Secured Party to maintain the
validity, perfection and priority of the Security Interest granted
by the Pledgor:
(i) change its name or
state of formation; or
(ii) permit
any Collateral to be held by any securities intermediary, held or
maintained in the form of a securities entitlement or credited to
any securities account.
D. At
any time and from time to time, upon the written request of the
Secured Party, and at the sole expense of the Pledgor, the Pledgor
will promptly and duly execute and deliver such further instruments
and documents and take such further actions as the Secured Party
may reasonably request for the purposes of obtaining or preserving
the full benefits of this Pledge Agreement and of the rights and
powers herein granted.
SECTION
6. CASH
DIVIDENDS AND DISTRIBUTIONS; VOTING RIGHTS.
Unless
a Default shall have occurred and be continuing and the Secured
Party shall have given notice to the Pledgor of the Secured
Party’s intent to exercise its rights pursuant to Section 7
of this Pledge Agreement, the Pledgor shall be permitted to receive
all cash dividends and partnership or ownership distributions paid
in respect of the Collateral and to exercise all voting and
partnership or ownership rights, as applicable, with respect to the
Collateral. For so long as the Pledgor shall be entitled to
exercise voting rights with respect to the Collateral, the Pledgor
covenants and agrees not to vote or take any consensual action
which would cause a Default to occur.
SECTION
7. RIGHTS
OF THE SECURED PARTY.
If a
Default shall occur and be continuing and the Secured Party shall
give notice of its intent to exercise such rights to the Pledgor,
(i) the Secured Party shall have the right to receive any and
all cash dividends paid in respect of the partnership or ownership
distributions made in respect of the LLC Interests and apply such
amounts to the Obligations in the manner determined by the Secured
Party and (ii) all the LLC Interests shall be registered in the
name of the Secured Party and the Secured Party may thereafter
exercise (A) all voting, partnership, ownership, membership and
other rights pertaining to such LLC Interests at any meeting of
partners or members of the Company or otherwise and (B) any
and all rights, privileges or options pertaining to such LLC
Interests as if it were the absolute owner thereof, all without
liability except to account for property actually received by it,
but the Secured Party shall have no duty to the Pledgor to exercise
any such right, privilege or option and shall not be responsible
for any failure to do so or delay in so doing. The LLC Agreement is
amended by this Section
7A to permit Pledgor to pledge all of its LLC Interests to
and grant and collaterally assign to M&T Bank and the Secured
Party a lien and security interest in its LLC Interests without any
further consent, approval or action by any other party, including,
without limitation, any other party to the LLC Agreement or
otherwise. The rights, powers and benefits granted pursuant to this
Section 7A shall
inure to the benefit of the Secured Party and its successors and
assigns and designated agents, as intended third party
beneficiaries.
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SECTION
8. REMEDIES.
If a
Default shall occur and be continuing, the Secured Party, in
addition to all other rights and remedies granted to it in this
Pledge Agreement and in any other instrument or agreement securing,
evidencing or relating to the Obligations, have all rights and
remedies of a secured party under the UCC or any other applicable
law. Without limiting the generality of the foregoing with regard
to the scope of the Secured Party’s remedies, the Secured
Party, without demand of performance or other demand, presentment,
protest, advertisement or notice of any kind (except any notice
required by any applicable law referred to below) to or upon the
Pledgor, the Company or any other person (all of which are hereby
waived), may in such circumstances collect, receive, appropriate
and realize upon the Collateral, or any part thereof, and/or may
sell, assign, give options to purchase or otherwise dispose of and
deliver the Collateral or any part thereof (or contract to do any
of the foregoing), in one or more parcels at public or private sale
or sales, in the over-the-counter market, at any exchange,
broker’s board or office of the Secured Party or elsewhere
upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for cash or on credit or for future
delivery without assumption of any credit risk. The Secured Party
shall have the right upon any such public sale or sales, and, to
the extent permitted by any applicable law, upon any such private
sale or sales, to purchase the whole or any part of the Collateral
so sold, free of any right or equity of redemption in the Pledgor,
which right or equity is hereby waived or released. To the extent
permitted by any applicable law, the Pledgor waives all claims,
damages and demands it may acquire against the Secured Party
arising out of the exercise of any rights hereunder, other than
claims arising out of the gross negligence or willful misconduct of
the Secured Party as determined by a court of competent
jurisdiction by final and nonappealable judgment. If any notice of
a proposed sale or other disposition of Collateral shall be
required by any applicable law, such notice shall be deemed
reasonable and proper if given at least ten (10) days before such
sale or other disposition.
SECTION
9. SECURED
PARTY’S APPOINTMENT AS ATTORNEY-IN-FACT.
A. The Pledgor hereby
irrevocably constitutes and appoints the Secured Party and any
officer or agent thereof, with full power of substitution, as its
true and lawful attorney-in-fact with full irrevocable power and
authority in the place and stead of the Pledgor and in the name of
the Pledgor or in its own name, for the purpose of carrying out the
terms of this Pledge Agreement, to take any and all appropriate
action and to execute any and all documents and instruments which
may be necessary or desirable to accomplish the purposes of this
Pledge Agreement, and, without limiting the generality of the
foregoing, the Pledgor hereby gives the Secured Party the power and
right, on behalf of the Pledgor, without notice to or assent by the
Pledgor, to do any or all of the following upon the occurrence and
continuation of a Default:
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(i) pay or discharge
taxes and liens levied or placed on or threatened against the
Collateral;
(ii) execute,
in connection with any sale provided for in this Pledge Agreement,
any endorsements, assignments or other instruments of conveyance or
transfer with respect to the Collateral; and
(iii) (A)
commence and prosecute any suits, actions or proceedings at law or
in equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in
respect of any Collateral; (B) defend any suit, action or
proceeding brought against the Pledgor with respect to any
Collateral; (C) settle, compromise or adjust any such suit, action
or proceeding and, in connection therewith, give such discharges or
releases as the Secured Party may deem appropriate; and (D)
generally sell, transfer, pledge and make any agreement with
respect to or otherwise deal with any of the Collateral as fully
and completely as though the Secured Party were the absolute owner
thereof for all purposes, and do, at the Secured Party’s
option and the Pledgor’s expense, at any time, or from time
to time, all acts and things which the Secured Party deems
necessary to protect, preserve or realize upon the Collateral and
the Secured Party’s Security Interest therein and to effect
the intent of this Pledge Agreement, all as fully and effectively
as the Pledgor might do.
B. If the Pledgor
fails to perform or comply with any of its agreements contained
herein, the Secured Party, at its option, but without any
obligation so to do, may perform or comply, or otherwise cause
performance or compliance, with such agreement in accordance with
the provisions of Section
9A.
C. The expenses of the
Secured Party incurred in connection with actions taken pursuant to
the terms of this Pledge Agreement shall be payable by the Pledgor
to the Secured Party on demand.
D. The Pledgor hereby
ratifies all that said attorneys shall lawfully do or cause to be
done by virtue hereof in accordance with Section 9A. All powers,
authorizations and agencies contained in this Pledge Agreement are
coupled with an interest and are irrevocable until this Pledge
Agreement is terminated and the Security Interests created hereby
are released.
SECTION
10. REGISTRATION
RIGHTS; PRIVATE SALES.
A. The Pledgor
recognizes that the Secured Party may be unable to effect a public
sale of any or all the Collateral, by reason of certain
prohibitions contained in applicable Federal and state securities
laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers which
will be obliged to agree, among other things, to acquire such
securities for their own account for investment and not with a view
to the distribution or resale thereof. The Pledgor acknowledges and
agrees that any such private sale may result in prices and other
terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private
sale shall be deemed to have been made in a commercially reasonable
manner. The Secured Party shall be under no obligation to delay a
sale of any of the Collateral for the period of time necessary to
permit the Company to register such securities for public sale
under applicable Federal and state securities laws, even if the
Company would agree to do so.
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B. The Pledgor further
agrees to use its best efforts to do or cause to be done all such
other acts as may be necessary to make such sale or sales of all or
any portion of the Collateral pursuant to this Section 10 valid and binding
and in compliance with any and all other applicable law. The
Pledgor further agrees that a breach of any of the covenants
contained in this Section
10 will cause irreparable injury to the Secured Party not
compensable in damages, that the Secured Party has no adequate
remedy at law in respect of such breach and, as a consequence, that
each and every covenant contained in this Section 10 shall be
specifically enforceable against the Pledgor, and the Pledgor
hereby waives and agrees not to assert any defenses against an
action for specific performance of such covenants except for a
defense that no Default has occurred.
SECTION
11. CHANGES
WITH RESPECT TO THE OBLIGATIONS.
The
Pledgor shall remain obligated hereunder, and the Collateral shall
remain subject to the Security Interest granted herein,
notwithstanding that, without any reservation of rights against the
Pledgor, and without notice to or further assent by the Pledgor,
any demand for payment of any of the Obligations made by the
Secured Party may be rescinded by the Secured Party, and any of the
Obligations continued, and the Obligations, or the liability of the
Pledgor or any other person upon or for any part thereof, or any
collateral security or guarantee therefor, may, from time to time,
in whole or in part, be renewed, extended, amended, modified,
accelerated, compromised, waived, surrendered, or released by the
Secured Party, and the Loan Documents and any other documents
executed and delivered in connection therewith may be amended,
modified, supplemented or terminated, in whole or part, as the
Secured Party may deem advisable from time to time, and any
guarantee or other collateral security at any time held by the
Secured Party for the payment of the Obligations may be sold,
exchanged, waived, surrendered or released. The Secured Party shall
not have any obligation to protect, secure, perfect or insure any
other lien at any time held by it as security for the Obligations
or any property subject thereto. The Pledgor waives any and all
notice of the creation, renewal, extension or accrual of any of the
Obligations and notice of or proof of reliance by the Secured Party
upon this Pledge Agreement. The Obligations shall conclusively be
deemed to have been created, contracted or incurred in reliance
upon this Pledge Agreement and all dealings between the Pledgor, on
the one hand, and the Secured Party, on the other, shall likewise
be conclusively presumed to have been had or consummated in
reliance upon this Pledge Agreement. The Pledgor waives diligence,
presentment, protest, demand for payment and notice of default or
nonpayment to or upon the Pledgor with respect to the
Obligations.
SECTION
12. NO
SUBROGATION.
Notwithstanding any
payment or payments made by the Pledgor hereunder, or the receipt
of any amounts by the Secured Party with respect to any of the
Collateral, the Pledgor shall not be entitled to be subrogated to
any of the rights of the Secured Party against any guarantor or
against any other collateral security held by the Secured Party for
the payment of the Obligations, nor shall the Pledgor seek any
reimbursement from any guarantor in respect of payments made by the
Pledgor in connection with the Collateral, or amounts realized by
the Secured Party in connection with the Collateral, until all
amounts owing to the Secured Party on account of the Obligations
are paid in full. If any amount shall be paid to the Pledgor on
account of such subrogation rights at any time when all of the
Obligations shall not have been paid in full, such amount shall be
held by the Pledgor in trust for the Secured Party, segregated from
other funds of the Pledgor, and shall, forthwith upon receipt by
the Pledgor, be turned over to the Secured Party in the exact form
received by the Pledgor (duly indorsed by the Secured Party, if
required) to be applied against the Obligations, whether matured or
unmatured, in such order or manner determined by the Secured Party
or in the order or preference as is provided in the
Note.
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SECTION
13. LIMITATION
ON DUTIES REGARDING COLLATERAL.
The
Secured Party’s sole duty with respect to the custody,
safekeeping and physical preservation of the Collateral in its
possession shall be to deal with it in the same manner as the
Secured Party deals with similar securities and property for its
own account. Neither the Secured Party nor any of its directors,
officers, managers, members, employees or agents shall be liable
for failure to demand, collect or realize upon any of the
Collateral or for any delay in doing so or shall be under any
obligation to sell or otherwise dispose of any Collateral upon the
request of the Pledgor or otherwise. The powers conferred on the
Secured Party hereunder are solely to protect the Secured
Party’s interests in the Collateral and shall not impose any
duty on the Secured Party to exercise any such powers. The Secured
Party shall be accountable only for amounts that it actually
receives as a result of the exercise of such powers, and neither it
nor any of its directors, officers, managers, members, employees or
agents shall be responsible to the Pledgor for any act or failure
to act hereunder, except for its gross negligence or willful
misconduct as determined by a court of competent jurisdiction by
final and nonappealable judgment.
SECTION
14. APPLICATION
OF PROCEEDS.
Upon
the occurrence and during the continuance of a Default, the
proceeds of any sale of, or other realization upon, all or any part
of the Collateral shall be applied by the Secured Party in such
order and manner as the Secured Party may determine. Any balance of
such Proceeds remaining shall be paid over to the Pledgor, or to
whomsoever may be lawfully entitled to receive the same. Only after
(a) payment by the Secured Party of any other amount required by
any provision of law, including, without limitation, Section 9-608
and Section 9-615 of the UCC and (b) the payment in full of the
Obligations, shall the Secured Party account for the surplus, if
any, to the Pledgor, or to whomever may be lawfully entitled to
receive the same. The Secured Party may make distribution hereunder
in cash or in kind or, on a ratable basis, in any combination
thereof.
SECTION
15. WAIVER,
DEFICIENCY.
The
Pledgor hereby waives, to the extent permitted by applicable law,
all rights of redemption, appraisement, valuation, stay, extension
or moratorium now or hereafter in force under any applicable law in
order to prevent or delay the enforcement of this Pledge Agreement
or the absolute sale of the Collateral or any portion thereof. The
Pledgor shall remain liable for any deficiency if the proceeds of
any sale or other disposition of the Collateral are insufficient to
pay its Obligations and the fees and disbursements of any attorneys
employed by the Secured Party to collect such
deficiency.
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SECTION
16. ALL
POWERS COUPLED WITH INTEREST.
All
powers of attorney and other authorizations granted to the Secured
Party pursuant to any provisions of this Pledge Agreement shall be
deemed coupled with an interest and shall be irrevocable so long as
any of the Obligations remain unpaid or unsatisfied.
SECTION
17. NO
WAIVERS, CUMULATIVE REMEDIES.
No
waiver of any Default shall be a waiver of any other Default. No
failure on the part of the Secured Party to exercise and no delay
in exercising, and no course of dealing with respect to, any right,
power or privilege under this Pledge Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any
right, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, power or
privilege. No remedy, right or power conferred upon the Secured
Party is intended to be exclusive of any other remedy, right or
power given hereunder or now or hereafter existing at law, in
equity, or otherwise, and all such remedies, rights and powers
shall be cumulative.
SECTION
18. EXPENSES
AND INDEMNIFICATION.
A. The Pledgor agrees
to indemnify the Secured Party from and against any and all claims,
losses and liabilities, as finally determined by a court of
competent jurisdiction, arising out of or resulting from this
Pledge Agreement (including enforcement of this Pledge Agreement),
except to the extent such claims, losses or liabilities result
solely from the Secured Party’s negligence or willful
misconduct as finally determined by a court of competent
jurisdiction.
B. The Pledgor shall
pay to the Secured Party upon demand the amount of any and all
costs and expenses, including the reasonable fees and expenses of
its counsel and of any experts and agents, that the Secured Party
may incur in connection with (i) the exercise or enforcement of any
of the rights of the Secured Party hereunder or (ii) the
failure by Pledgor to perform or observe any of the provisions
hereof.
SECTION
19. INJUNCTIVE
RELIEF; PUNITIVE OR INDIRECT DAMAGES.
A. The Pledgor
recognizes that, in the event the Pledgor fails to perform, observe
or discharge any of its obligations or liabilities under this
Pledge Agreement, any remedy of law may prove to be inadequate
relief to the Secured Party. Therefore, the Pledgor agrees that the
Secured Party shall be entitled to seek temporary and permanent
injunctive relief in any such case without the necessity of proving
actual damages.
B. The Secured Party
and the Pledgor hereby agree that it shall not have a remedy of
punitive or exemplary damages against any other party to a Loan
Document and to the extent permitted by law hereby waives any right
or claim to punitive or exemplary damages that it may now have or
that may arise in the future in connection with any dispute,
whether such dispute is resolved through arbitration or
judicially.
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C. Without limiting
the generality of any provisions set forth herein relating to
indemnification or reimbursement by the Pledgor, each of the
Secured Party and the Pledgor hereby agrees that it shall not have
a remedy of consequential or indirect damages against any other
party to a Loan Document, and to the extent permitted by law it
hereby waives any right or claim to consequential or indirect
damages that it may now have or that may arise in the future in
connection with any dispute, whether such dispute is resolved
through arbitration or judicially.
SECTION
20. CONTROL
AGREEMENT; ACKNOWLEDGEMENT BY THE COMPANY.
A. The Pledgor hereby
authorizes and instructs the Company to comply, and the Company
hereby agrees to so comply, with any instruction received thereby
from the Secured Party in accordance with the terms of this Pledge
Agreement with respect to the Collateral, without any consent or
further instructions from the Pledgor (or other registered owner),
and the Pledgor agrees that the Company shall be fully protected in
so complying. The Company agrees that its agreement set forth in
the preceding sentence shall be sufficient to create in favor of
the Secured Party, “control” of the LLC Interests
within the meaning of such term under the UCC.
B. The Company
acknowledges receipt of a copy of this Pledge Agreement and agrees
to be bound thereby and to comply with the terms thereof insofar as
such terms are applicable to it. The Company further agrees that
the terms of Section
10 of this Pledge Agreement shall apply to it with respect
to all actions that may be required of it under or pursuant to or
arising out of Section
10 of this Pledge Agreement.
SECTION
21. RELEASES.
At such
time as the Obligations shall have been paid in full, this Pledge
Agreement and all obligations (other than those expressly stated to
survive such termination) of the Secured Party and the Pledgor
hereunder shall terminate, all without delivery of any instrument
or performance of any act by any party. Upon any such termination,
the Secured Party shall execute and deliver to the Pledgor, at the
Pledgor’s expense, such documents as the Pledgor shall
reasonably request to evidence such termination, and the Pledgor
shall be entitled to the return, upon its reasonable request, of
such of the Collateral as shall not have been sold or otherwise
applied pursuant to the terms hereof.
SECTION
22. MISCELLANEOUS.
A. Amendments and Waivers. No waiver, amendment or
modification of any provision of this Pledge Agreement shall be
valid unless in writing and signed by all of the parties
hereto.
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B. Successors and Assigns. This Pledge
Agreement shall be binding upon the successors and assigns of the
Pledgor and shall inure to the benefit of the Pledgor (and shall
bind all persons who become bound as a Pledgor under this Pledge
Agreement), the Secured Party and its successors and assigns;
provided that the Pledgor may not assign, transfer or delegate any
of its rights or obligations under this Pledge Agreement without
the prior written consent of the Secured Party.
C. Governing Law; Jurisdiction. This Pledge
Agreement shall be governed by, construed and enforced in
accordance with the laws of the State of Delaware, without
reference to the conflicts or choice of law principles thereof. The
Pledgor hereby irrevocably consents to non-exclusive personal
jurisdiction in the State of Delaware.
D. Waiver of Jury Trial. THE PLEDGOR WAIVES
ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM
ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS PLEDGE
AGREEMENT, ANY RIGHTS, REMEDIES, OBLIGATIONS, OR DUTIES HEREUNDER,
OR THE PERFORMANCE OR ENFORCEMENT HEREOF OR THEREOF. The Pledgor
(i) certifies that neither the Secured Party nor any
representative, agent or attorney of the Secured Party has
represented, expressly or otherwise, that the Secured Party would
not, in the event of litigation, seek to enforce the foregoing
waiver or other waivers contained in this Pledge Agreement, and
(ii) acknowledges that, in entering into the Loan Documents,
the Secured Party is relying upon, among other things, the waivers
and certifications contained in this Section.
E. Severability. Any provision of this
Pledge Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to
the extent of such prohibition or unenforceability without
invalidating the remainder of such provision or the remaining
provisions hereof or thereof or affecting the validity or
enforceability of such provision in any other
jurisdiction.
Notices. Any notices to the Pledgor shall be sufficiently
given, if in writing and mailed or delivered to LB&B
Associates, Inc., 0000 Xxxxxx Xxxx Xxxxxxx, Xxxxx 000, Xxxxxxxx, XX
00000, ATTN: Xxxx Xxxxx or such other address as provided
hereunder; and to the Secured Party, if in writing and mailed or
delivered to Brekford Corp, 0000 Xxxxxx Xx., Xxxx. X, Xxxxxxx, XX
00000, ATTN: Xxxxxx X. Xxxxxxx or such other address as the Secured
Party may specify in writing from time to time. In the event that
the Pledgor changes its mailing address at any time prior to the
date the Obligations are paid in full, the Pledgor agrees to
promptly give written notice of said change of address by
registered or certified mail, return receipt requested, all charges
prepaid.
F. Titles and Captions. Titles and captions
of Articles, Sections and subsections in, and the table of contents
of, this Pledge Agreement are for convenience only, and neither
limit nor amplify the provisions of this Pledge
Agreement
G. Counterparts; Integration;
Effectiveness. This Pledge Agreement may be executed in any
number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be
an original and shall be binding upon all parties, their successors
and assigns, and all of which taken together shall constitute one
and the same agreement. This Pledge Agreement, together with the
Note, comprises the complete and integrated agreement of the
parties on the subject matter hereof and thereof and supersedes all
prior agreements, written or oral, on such subject matter. Delivery
of an executed counterpart of a signature page of this Pledge
Agreement by telecopy or electronic mail shall be effective as
delivery of a manually executed counterpart of this Pledge
Agreement. This Pledge Agreement shall remain in effect through and
including the date upon which all Obligations shall have been
indefeasibly and irrevocably paid and satisfied in
full.
[NEXT
PAGE IS SIGNATURE PAGE]
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IN WITNESS WHEREOF, the undersigned have caused this Pledge
Agreement to be duly executed and delivered as of the date first
above written
|
|
PLEDGOR:
LB&B ASSOCIATES
INC.
By:
/s/ Xxxxxxxxx Xxxxx
Name:
Xxxxxxxxx Xxxxx
Title:
Executive Senior Vice
President
SECURED
PARTY:
By:
/s/ Xxxxxx X.
Xxxxxxx
Name:
Xxxxxx X.
Xxxxxxx
Title: President and COO
ACKNOWLEDGED
AND AGREED:
GLOBAL
PUBLIC SAFETY, LLC
By:
/s/ Xxxxxx X.
Xxxxxxx
Name:
Xxxxxx X.
Xxxxxxx
Title: President |
[Signature
Page to Pledge Agreement]
12
