PLEDGE AGREEMENT
Date: April 27, 1995, but effective
as of March 1 5, 1 995
In this agreement, the words you and your mean anyone signing this
agreement, and the words we, us and our mean MICHIGAN NATIONAL BANK, a national
banking association, located at 00000 Xxxxxxx Xxxx, Xxxxxxxxxx Xxxxx, Xxxxxxxx
00000-0000. The word borrower means CENTURY SUPPLY CORP., a Michigan
corporation.
YOUR PROPERTY
In this agreement, the words your property means any warehouse receipt,
letter of credit, promissory note, stock, bond, debenture, certificate of
deposit, and any other instrument, document, or security described below, and
any money, stock, bond, dividend, or other security issued directly or
indirectly from such property, all renewals of any certificate of deposit, and
all replacement property as you deliver or cause to be delivered to us from time
to time.
You are delivering to us your property described below:
200 shares, which constitutes 100% of the voting stock of CBE Acquisition
Corporation
If your above property is a certificate of deposit, you agree that we may
automatically renew the certificate of deposit at maturity. You agree to
promptly deliver to us within twenty-one (21) days after your receipt, all
dividends, money, interest, stock dividends, promissory notes, and all other
property, documents, or agreements which you receive and which are related to
any of your property described above and here delivered to us.
SECURITY INTEREST
By signing this agreement you are pledging and giving us a security
interest in your property described above, in all money and other property
payable or issued directly or indirectly on account of your property, and all
proceeds of your property, to secure the payment of indebtedness and obligations
to us, of every kind, nature and description, direct or indirect, absolute or
contingent, now existing or hereafter arising or acquired, now due or hereafter
becoming due, and whether joint, several or joint and several, including,
without limitation, your agreements herein and the agreements contained in every
promissory note, guaranty, security agreement, loan agreement, "swap agreement"
(within the meaning of the United States Bankruptcy Code of 1978, as amended, 11
USC 101 et seq.) or other document, instrument or agreement, now existing or
hereafter executed or delivered to us, with respect to any existing or future
loan, "swap" (within the meaning of the Bankruptcy Code of 1978, as amended, 11
USC 101 et seq.), deposit account overdraft or other financial accommodation we
make to you [ ] or to the borrower, with the interest, fees and charges provided
for in any such document, instrument or agreement, or by law, all renewals,
extensions, modifications, and refinancings thereof and all costs, expenses and
reasonable attorneys' and paralegals' fees (including without limitation the
allocated expenses of our in-house attorneys and paralegals) when they disburse,
administer, enforce or collect any such indebtedness or obligation, protect,
maintain or liquidate your property or defend, pay or compromise any claim or
action related to or arising from your indebtedness or obligation to us. A
person with a security interest in your property has, among other rights, the
right to sell your property under certain circumstances. You agree to promptly
pay all taxes, fees, and charges concerning the purchase or ownership of your
property. If you do not, we can do so, and you agree to reimburse us for all
amounts we pay, plus interest on those amounts at the same rate of interest
charged to the borrower.
OWNERSHIP OF YOUR PROPERTY
You promise us that you own your property free of any and all claims by
anyone other than you or us, that no one other than you owns your property, and
that all of the owners of your property have signed this agreement.
CARE OF YOUR PROPERTY
You agree that we will have taken reasonable care of your property if we
treat it in the same way as we treat our own property of the same kind, but that
we are not responsible for taking any steps necessary to preserve or protect
your rights in your property against any prior or other parties. You agree that
if your property is of a kind which can be registered in our name, we can at any
time register your property in our name or in the name of someone who holds
securities for us, and you agree to sign all documents which we think are needed
to do so.
AUTHORITY TO EXERCISE RIGHTS IN YOUR PROPERTY
In general, you agree that as long as we have possession of your property,
we may do anything concerning your property that you could do, but we are not
required to do so. Without limiting this general power, we, or if we have your
property registered in the name of someone other than you that person, will have
all of your rights in your property (such as the right to vote securities and
the right to receive dividends or interest) but neither we nor such other person
are required to exercise any of those rights on your behalf. If you have
previously given authority to exercise rights in your property to someone other
than us, by signing this agreement you are revoking that authority previously
given. You agree that we can apply any money, such as cash dividends or
interest, which we receive from your property to pay any loans or other
obligations secured by your property, applying this money in any order we
choose, whether or not the loans or other obligations secured by your property
are then due.
MARGIN REQUIREMENTS
You understand and agree that if your property is "margin stock," as that
term is defined in Regulation U of Federal Reserve Board Regulations, and is
pledged to us to directly or indirectly secure the purchase or carrying of any
margin stock, we can not at anytime allow the unpaid balance of borrower's
loan(s) to exceed the maximum loan value prescribed under Regulation U. You
agree that if at any time the loan value of your margin stock exceeds the
maximum loan value allowed under Regulation U, you will immediately reduce or
cause to be reduced the unpaid balance of the loan(s) directly or indirectly
secured by your margin stock, or will immediately pledge to us additional margin
stock, so that the maximum loan value prescribed under Regulation U is not
exceeded.
SALE OF YOUR PROPERTY
You agree that we can sell your property if any of the following events
occur:
1. Any loan or other obligation owed us by you or by the borrower, either
now or in the future, is not paid or performed when the payment or
performance is due;
2. You or the borrower violate the provisions of this or any other
agreement with us, either now or in the future;
3. You or the borrower die;
4. You or the borrower make any false or misleading statement about any
important matter in an agreement or application with us.
Unless your property is likely to speedily decline in value or is property
commonly sold on a recognized market, we will give you at least fifteen (15)
days written notice before selling your property, sending the notice by regular
mail to your current address shown in our records. Upon your receipt of our
notice that we intend to sell your property, you can redeem it by paying in full
all loans, obligations, and costs secured by your property, prior to sale of
your property. Upon our sale of your property, we will apply the sale proceeds
to pay any attorney fees and other costs and expenses we have incurred on the
loans or obligations secured by your property, and then to the loans or other
obligations secured by your property, in any order we choose. If there is a
surplus remaining after applying the proceeds from sale of your property to our
fees, costs, and expenses and to the loans and obligations secured by your
property, we will promptly return the surplus to you.
You understand that our ability to sell your property may be limited
because of special laws and regulations applying to the sale of securities. You
agree to do anything we think is needed to help us sell your property, whether
needed because of these special laws and regulations or for any other reason,
and you agree that we will have a continuing power of attorney to sign your name
on any document necessary to sell your property if any of the events listed in
1. through 5. above occur.
CHANGE OF ADDRESS/NOTICE TO US
If your address changes, you agree to promptly notify us in writing of your
new address. Any notice you give us must be in writing and must be sent to our
address shown in this agreement.
NO NOTICE OR LOSS OF RIGHTS
You agree that we may, but are not required to, notify you if any loan or
obligation secured by your property is not paid or performed, and that we can
exercise any of our rights without losing any other rights against you or your
property. You agree that we can do any of the following without notifying you or
losing any rights against you or your property:
2
1. Allow additional time for payment or otherwise amend any loan
agreements with the borrower;
2. Delay exercising any rights against you, the borrower, your property,
and any other person or property;
3. Fail to protect or enforce our interest in any of your property.
ATTORNEY'S FEES AND COURT COSTS
If we hire an attorney to enforce or defend our rights in your property, to
perform any legal services in connection with the holding or sale of your
property, or in connection with the loans or obligations secured by your
property, you agree to pay us reasonable attorney fees and any court costs which
we have to pay.
OTHER AGREEMENTS
Any changes in this agreement must be in writing and signed by you and by
us. This agreement is the complete agreement between you and us concerning the
security interest in your property given by this agreement and supersedes all
prior agreements, written or oral. If any part of this agreement is determined
to be invalid, the rest of this agreement will remain in effect. All questions
about this agreement will be decided according to Michigan law.
AGREEMENT TERMINATION
This agreement will end when we return all of your property described in
the beginning of this agreement. We will return your property to you at such
time as neither you nor the borrower is indebted or otherwise obligated to us.
YOUR RESPONSIBILITY
You and everyone else signing this agreement will be, individually and
together, liable under it, and you understand that we can xxx you to enforce
this agreement even if we do not xxx anyone else. You agree that you have read
and understand and agree to be bound by all of the provisions of this agreement,
and that we have provided you with an opportunity to review this agreement with
legal counsel of your choice before signing this agreement.
WITNESSES: CENTURY SUPPLY CORP.,
a Michigan corporation
By: /s/ Xxxxx X. Xxxxxx
--------------------------- -----------------------------
Xxxxxx X. Xxxxxxxx Xxxxx X. Xxxxxx
Its: President
3