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EXHIBIT 10.8
SECURITY AGREEMENT AND STOCK PLEDGE
This SECURITY AGREEMENT AND STOCK PLEDGE (the "Agreement"), made and
entered into on this the 8th day of October, 1998, by and between CITIZENS FIRST
CORPORATION, of 0000 Xxxxxxx Xxxxxx, Xxxxxxx Xxxxx, Xxxxxxxx 00000, a Kentucky
corporation, (hereinafter "Debtor"), and FIRST SECURITY BANK OF LEXINGTON, 000
Xxxx Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, (hereinafter referred to as
"Secured Party").
For valuable consideration received, including, without limitation,
the mutual covenants contained herein and the mutual benefits to be derived
herefrom, the parties hereby promise, covenant and agree as follows:
1. Debtor hereby assigns, transfers to and pledges unto Secured Party
the following described property, hereinafter "Collateral," and hereby also
grants to Secured Party a security interest in all said Collateral:
Xxxxxx Xxxxxx and Company, Inc., Account No.
_________________, together with all cash,
securities and other assets from time to time
maintained in the account
The Collateral hereunder shall include all proceeds from the foregoing
and all substitutes therefor or additions thereto, together with any interest,
stock rights, rights to subscribe, dividends, stock dividends, dividends paid in
stock, liquidating dividends, new securities and other property to which the
Debtor may become entitled by reason of the ownership of the Collateral during
the existence of this Agreement. Debtor has contemporaneously with the execution
of this Agreement executed an Escrow Agreement naming Xxxxxx Xxxxxx and Company,
Inc. as escrow
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agent and depository of the Collateral. The Debtor appoints Escrow Agent its
attorney-in-fact for the transfer of the Collateral to the name of the Secured
Party in event of default hereunder.
2. OBLIGATIONS. The security interest and pledge hereby granted and
made secures payment and performance of all the Debtor's indebtedness to Secured
Party, present and future, which shall include all of the following (hereinafter
"Obligations"):
(a) All indebtedness evidenced by the Debtor's promissory note or
notes to the Secured Party of even date herewith.
(b) All of the Debtor's Obligations under this Agreement.
3. DIVIDENDS. Unless an event of default occurs as defined herein, the
Debtor shall, during the term of this Agreement, be entitled to receive any and
all dividends or other income from the Collateral; provided, however, that upon
the occurrence of any event of default, the Secured Party may, at its option,
give notice to the Escrow Agent in accordance with the terms and conditions of
the Escrow Agreement and receive the pledged shares. All dividends and other
amounts received by Secured Party as a result of its record ownership of the
pledged shares shall be applied to the payment of the Obligations secured
hereby.
4. VOTING RIGHTS. Unless an event of default occurs as defined herein,
the Debtor shall be entitled to vote all corporate shares constituting any
portion of the Collateral on all corporate questions. Upon the occurrence of an
event of default, the Secured Party may, at its option, vote all shares held by
it on all corporate questions.
5. REPRESENTATIONS. Debtor warrants and represents that there are no
restrictions upon the transfer of any of the pledged shares other than may
appear on the face of the certificates and that the Debtor has the right to
transfer such shares free of any encumbrances and without
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obtaining the consent of other shareholders or, if such consent is required,
that same has been obtained.
6. ADJUSTMENTS. In the event that during the term of this Agreement
any share dividend, reclassification, readjustment or other change is declared
or made in the capital structure of any corporation in which shares are hereby
pledged or any subscription warrant or other option is exercisable with respect
to the pledged shares, all new, substituted or additional shares or other
securities issued by reason of any such change or option shall be delivered to
Escrow Agent as additional collateral under the terms of this Agreement and the
Escrow Agreement in the same manner as the shares originally pledged.
7. DEFAULT. Default hereunder shall occur on the happening of any one
or more of the following events:
(a) Nonpayment when due, whether by acceleration or otherwise, of
any Obligation.
(b) If the Debtor: (1) files a bankruptcy petition or for the
approval of a plan of reorganization or arrangement under the
Bankruptcy Code (as now exists or as may be amended from time
to time); (2) is unable or admits in writing the inability to
pay his indebtedness as it becomes due; (3) makes an assignment
for the benefit of creditors; (4) has a receiver appointed
voluntarily or otherwise for his property; (5) is adjudicated a
bankrupt; or, (6) becomes insolvent, defaults in the payment of
any indebtedness to any other person or entity or permits the
time of payment of any other indebtedness to become
accelerated.
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(c) Default in the performance of any of the terms of this
Agreement or the terms of the Promissory Notes.
8. REMEDIES. On the happening of any default hereunder, the Secured
Party's sole remedy shall be to take possession and ownership of said stock
serving as collateral. Debtor shall execute all documents necessary and
appropriate to effectuate such transfer.
9. POSSESSION OF COLLATERAL. The Collateral shall be held by Escrow
Agent which, for purposes of KRS 355.9-305, shall be deemed to be possession by
the Secured Party.
10. MISCELLANEOUS.
(a) This instrument shall in all respects be governed by and
construed in accordance with the laws of the Commonwealth of
Kentucky, including all matters of construction, validity and
performance.
(b) In construing this document neuter pronouns shall be
substituted for those masculine in form and vice-versa and
plural terms shall be substituted for those singular and
singular for plural in any place in which the context so
requires. If there be more than one Debtor, their Obligations
hereunder shall be joint and several.
(c) No waiver by Secured Party of any default shall operate as a
waiver of any other default or of the same default on any
future occasions.
(d) Any carbon, photographic or other reproduction of this
Agreement or a financing statement hereof shall be sufficient
to use and to file as a financing statement of this Agreement
or for purposes of giving notice to any agent pursuant to KRS
355.9-305.
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11. DEBTOR'S ACKNOWLEDGMENT. The Debtor hereby acknowledges receipt of
a true copy of this Agreement and that all blank spaces were filled in prior to
the Debtor's signing of this Agreement.
IN TESTIMONY WHEREOF, witness the signatures of the parties hereto on
the date first above entered.
DEBTOR:
CITIZENS FIRST CORPORATION
BY: /s/ Xxxx X. Xxxxxx
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SECURED PARTY:
FIRST SECURITY BANK OF LEXINGTON
BY: /s/ R. Xxxx Xxxxxxxxx
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COMMONWEALTH OF KENTUCKY
COUNTY OF XXXXXX
I, the undersigned, a Notary Public in and for the Commonwealth and
County aforesaid, do hereby certify that Xxxx Xxxxxx did personally appear
before me, after being duly sworn, declared that she is the president of
Citizens First Corporation and that she acknowledged and executed the foregoing
Security Agreement and Stock Pledge as the president of said Corporation for and
on behalf of said Corporation and that all statements contained therein are true
as of this 8th day of October, 1998.
/s/ Xxxxx X. Xxxxxxx
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NOTARY PUBLIC, KY STATE-AT-LARGE
MY COMMISSION EXPIRES: 2-11-2002
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COMMONWEALTH OF KENTUCKY
COUNTY OF Xxxxxx
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I, the undersigned, a Notary Public in and for the Commonwealth and
County aforesaid, do hereby certify that Xxxx Xxxxxxxxx did personally appear
before me, after being duly sworn, declared that _he is the Senior Vice
President of First Security Bank of Lexington and that _he acknowledged and
executed the foregoing Security Agreement and Stock Pledge as the Senior Vice
President of said Bank for and on behalf of First Security Bank of Lexington and
that all statements contained therein are true as of this 8th day of October,
1998.
/s/ Xxxxx X. Xxxxxxx
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NOTARY PUBLIC, Ky. State-at-Large
My Commission Expires: 2-11-2002
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